EXHIBIT 10.32
$200,000,000
CREDIT AGREEMENT
dated as of
March 11, 1997
among
Iomega Corporation,
The Banks Party Hereto,
Citibank, N.A.,
as Administrative Agent,
and
Xxxxxx Guaranty Trust Company of New York,
as Documentation Agent
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS
SECTION 1.01. Definitions 1
SECTION 1.02. Accounting Terms and Determinations 12
ARTICLE 2 THE CREDITS
SECTION 2.01. Commitments to Lend 12
SECTION 2.02. Method of Borrowing 12
SECTION 2.03. Maturity of Loans 14
SECTION 2.04. Interest Rates 14
SECTION 2.05. Method of Electing Interest Rates 15
SECTION 2.06. Fees 17
SECTION 2.07. Termination or Reduction of Commitments 17
SECTION 2.08. Optional Prepayments 17
SECTION 2.09. General Provisions as to Payments 18
SECTION 2.10. Funding Losses 18
SECTION 2.11. Computation of Interest and Fees 19
SECTION 2.12. Notes 19
ARTICLE 3 CONDITIONS
SECTION 3.01. Closing 20
SECTION 3.02. Borrowings 21
ARTICLE 4 REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power 22
SECTION 4.02. Corporate and Governmental Authorization;
No Contravention 22
SECTION 4.03. Binding Effect 22
SECTION 4.04. Financial Information 22
SECTION 4.05. Litigation 23
SECTION 4.06. Compliance with ERISA 23
SECTION 4.07. Environmental Matters 23
SECTION 4.08. Taxes 24
SECTION 4.09. Subsidiaries 24
SECTION 4.10. Regulatory Restrictions on Borrowing 24
SECTION 4.11. Full Disclosure 24
SECTION 4.12. Representations in Collateral Documents
True and Correct 25
ARTICLE 5 COVENANTS
SECTION 5.01. Information 25
SECTION 5.02. Payment of Obligations 27
SECTION 5.03. Maintenance of Property; Insurance 28
SECTION 5.04. Conduct of Business and Maintenance of
Existence 28
SECTION 5.05. Compliance with Laws 29
SECTION 5.06. Inspection of Property, Books and Records 29
SECTION 5.07. Mergers and Sales of Assets 29
SECTION 5.08. Use of Proceeds 29
SECTION 5.09. Negative Pledge 30
SECTION 5.10. Limitation on Debt 31
SECTION 5.11. Minimum Consolidated Tangible Net Worth 31
SECTION 5.12. Debt to Consolidated Tangible Net Worth 32
SECTION 5.13. Minimum Consolidated EBITDA 32
SECTION 5.14. Maximum Cash Conversion Days 32
SECTION 5.15. Restricted Payments 32
SECTION 5.16. Investments 32
SECTION 5.17. Transactions with Affiliates 33
SECTION 5.18. Further Assurances 33
ARTICLE 6 DEFAULTS
SECTION 6.01. Events of Default 34
SECTION 6.02. Notice of Default 36
ARTICLE 7 THE AGENTS
SECTION 7.01. Appointment and Authorization 36
SECTION 7.02. Agents and Affiliates 37
SECTION 7.03. Action by Agents 37
SECTION 7.04. Consultation with Experts 37
SECTION 7.05. Liability of Agents 37
SECTION 7.06. Indemnification 38
SECTION 7.07. Credit Decision 38
SECTION 7.08. Successor Agents 38
SECTION 7.09. Agents Fees 38
ARTICLE 8 CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate
Inadequate or Unfair 39
SECTION 8.02. Illegality 39
SECTION 8.03. Increased Cost and Reduced Return 40
SECTION 8.04. Taxes 41
SECTION 8.05. Base Rate Loans Substituted for
Affected Euro-Dollar Loans 43
SECTION 8.06. Substitution of Bank 43
ARTICLE 9 MISCELLANEOUS
SECTION 9.01. Notices 44
SECTION 9.02. No Waivers 44
SECTION 9.03. Expenses; Indemnification 44
SECTION 9.04. Sharing of Set-offs 45
SECTION 9.05. Amendments and Waivers; Release of
Collateral 45
SECTION 9.06. Successors; Participation and Assignments 46
SECTION 9.07. No Reliance on Margin Stock 47
SECTION 9.08. Governing Law; Submission to Jurisdiction 47
SECTION 9.09. Counterparts; Integration; Effectiveness 48
SECTION 9.10. WAIVER OF JURY TRIAL 48
SECTION 9.11. Confidentiality 48
SECTION 9.12. Right of Set-off 49
COMMITMENT SCHEDULE
PRICING SCHEDULE
SCHEDULE I - Debt
EXHIBIT A - Note
EXHIBIT B - Opinion of Counsel for the Borrower
EXHIBIT C - Opinion of Special Counsel for the Agents
EXHIBIT D - Assignment and Assumption Agreement
EXHIBIT E - Security Agreement
EXHIBIT F - Pledge Agreement
AGREEMENT dated as of March 11, 1997 among IOMEGA CORPORATION, the BANKS
party hereto, CITIBANK, N.A., as Administrative Agent, and XXXXXX GUARANTY
TRUST COMPANY OF NEW YORK, as Documentation Agent.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used herein, have the
following meanings:
Administrative Agent means Citibank, N.A., in its capacity as administrative
agent for the Banks hereunder, and its successors in such capacity.
Administrative Questionnaire means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Administrative Agent,
completed by such Bank and returned to the Administrative Agent (with a copy
to the Borrower and the Documentation Agent).
Affiliate means (i) any Person that directly, or indirectly through one or
more intermediaries, controls the Borrower (a Controlling Person) or (ii)
any Person (other than the Borrower or a Subsidiary) which is controlled by
or is under common control with a Controlling Person. As used herein, the
term control means possession, directly or indirectly, of the power to vote
10% or more of any class of voting securities of a Person or to direct or
cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.
Agents means the Administrative Agent and the Documentation Agent, and Agent
means either of the foregoing.
Applicable Lending Office means, with respect to any Bank, (i) in the case of
its Base Rate Loans, its Domestic Lending Office, and (ii) in the case of its
Euro-Dollar Loans, its Euro-Dollar Lending Office.
Assignee has the meaning set forth in Section 9.06(c).
Bank means each bank listed on the signature pages hereof, each Assignee which
becomes a Bank pursuant to Section 9.06(c), and their respective successors.
Base Rate means, for any day, a rate per annum equal to the higher of (i) the
Prime Rate for such day and (ii) the sum of 2 of 1% plus the Federal Funds
Rate for such day.
Base Rate Loan means a Loan which bears interest at the Base Rate pursuant to
the applicable Notice of Borrowing or Notice of Interest Rate Election or the
provisions of Section 2.05(a) or Article 8.
Borrower means Iomega Corporation, a Delaware corporation, and its successors.
Borrowing means a borrowing hereunder consisting of Loans made to the Borrower
on the same day pursuant to Article 2, all of which Loans are of the same type
(subject to Article 8) and, except in the case of Base Rate Loans, have the
same initial Interest Period. A Borrowing is a Base Rate Borrowing if such
Loans are Base Rate Loans or a Euro-Dollar Borrowing if such Loans are Euro-
Dollar Loans.
Borrowing Base means, on any date, a dollar amount equal to 70% of the
consolidated trade receivables, less allowance for doubtful accounts, of the
Borrower and its Consolidated Subsidiaries determined as of the last day of
the most recently ended Fiscal Quarter for which financial statements are
required to have been delivered on or before such date pursuant to clauses
(a) and (b) of Section 5.01.
Closing Date means the date on or after the Effective Date on which the
Documentation Agent shall have received all the documents specified in or
pursuant to Section 3.01.
Collateral means collateral subject to the Collateral Documents.
Collateral Documents means the Pledge Agreement, the Security Agreement, any
additional pledge or security agreements required to be delivered pursuant
to the Loan Documents and any instruments of assignment, lockbox letters or
other instruments or agreements executed pursuant to the foregoing.
Commitment means (i) with respect to each Bank listed on the Commitment
Schedule, the amount set forth opposite the name of such Bank on the
Commitment Schedule, and (ii) with respect to any Assignee, the amount of the
transferor Bank's Commitment assigned to it pursuant to Section 9.06(c), in
each case as such amount may be changed from time to time pursuant to Section
2.07 or 9.06(c).
Commitment Schedule means the Commitment Schedule attached hereto.
Consolidated Debt means, at any date, the Debt of the Borrower and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
Consolidated EBITDA means, for any period, the net income of the Borrower and
its Consolidated Subsidiaries, determined on a consolidated basis for such
period, after excluding the effect of any extraordinary or other non-recurring
gain (but not loss) and the effect of the one-time pre-tax charge of
$9,100,000 taken in the last Fiscal Quarter of 1996, plus, to the extent
deducted in determining such net income for such period, the aggregate amount
of (i) interest expense, (ii) income tax expense, and (iii) depreciation,
amortization and other similar non-cash charges.
Consolidated Subsidiary means, at any date, any Subsidiary or other entity the
accounts of which would be consolidated with those of the Borrower in its
consolidated financial statements if such statements were prepared as of such
date.
Consolidated Tangible Net Worth means, at any date, the consolidated
stockholders' equity of the Borrower and its Consolidated Subsidiaries less
their consolidated Intangible Assets, all determined as of such date. As
used herein, Intangible Assets means the amount (to the extent reflected
in determining such consolidated stockholders' equity) of (i) all write-ups
(except write-ups resulting from foreign currency translations and write-ups
of assets of a going concern business made within twelve months after the
acquisition of such business) after September 30, 1996 in the book value of
any asset owned by the Borrower or a Consolidated Subsidiary, (ii) all
Investments in unconsolidated Subsidiaries and all equity Investments in
Persons which are not Subsidiaries and (iii) all unamortized debt discount
and expense, unamortized deferred charges, goodwill, patents, trademarks,
service marks, trade names, anticipated future benefit of tax loss carry-
forwards, copyrights, organization or developmental expenses and other
intangible assets.
Debt of any Person means, at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee which are
capitalized in accordance with GAAP, (v) all non-contingent obligations (and,
for purposes of Section 5.09 and the definitions of Material Debt and
Material Financial Obligations, all contingent obligations) of such Person
to reimburse any bank or other Person in respect of amounts paid under a
letter of credit or similar instrument, (vi) all Debt secured by a Lien on
any asset of such Person, whether or not such Debt is otherwise an obligation
of such Person, and (vii) all Guarantees by such Person of Debt of another
Person (each such Guarantee to constitute Debt in an amount equal to the
amount of such other Person's Debt Guaranteed thereby).
Default means any condition or event which constitutes an Event of Default or
which with the giving of notice or lapse of time or both would, unless cured
or waived, become an Event of Default.
Derivatives Obligations of any Person means all obligations of such Person in
respect of any rate swap transaction, basis swap, forward rate transaction,
commodity swap, commodity option, equity or equity index swap, equity or
equity index option, bond option, interest rate option, foreign exchange
transaction, cap transaction, floor transaction, collar transaction, currency
swap transaction, cross-currency rate swap transaction, currency option or
any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
Documentation Agent means Xxxxxx Guaranty Trust Company of New York, in its
capacity as documentation agent for the Banks hereunder, and its successors in
such capacity.
Domestic Business Day means any day except a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close.
Domestic Lending Office means, as to each Bank, its office located at its
address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office
by notice to the Borrower and the Administrative Agent.
Effective Date means the date this Agreement becomes effective in accordance
with Section 9.09.
Environmental Laws means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to the
environment or the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment, including (without limitation) ambient air,
surface water, ground water or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, Hazardous Substances or wastes or the
clean-up or other remediation thereof.
ERISA means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute.
ERISA Group means the Borrower, any Subsidiary and all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
Euro-Dollar Business Day means any Domestic Business Day on which commercial
banks are open for international business (including dealings in dollar
deposits) in London.
Euro-Dollar Lending Office means, as to each Bank, its office, branch or
affiliate located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire as its Euro-Dollar Lending
Office) or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Euro-Dollar Lending Office by notice to the
Borrower and the Administrative Agent.
Euro-Dollar Loan means a Loan which bears interest at a Euro-Dollar Rate
pursuant to the applicable Notice of Borrowing or Notice of Interest Rate
Election.
Euro-Dollar Margin has the meaning set forth in Section 2.04(b).
Euro-Dollar Rate means a rate of interest determined pursuant to Section
2.04(b) on the basis of a London Interbank Offered Rate.
Euro-Dollar Reserve Percentage means, for any day, that percentage (expressed
as a decimal) which is in effect on such day, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining
the maximum reserve requirement for a member bank of the Federal Reserve
System in New York City with deposits exceeding five billion dollars in
respect of Eurocurrency liabilities (or in respect of any other category
of liabilities which includes deposits by reference to which the interest
rate on Euro-Dollar Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-United States office of
any Bank to United States residents).
Events of Default has the meaning set forth in Section 6.01.
Exchange Act means the Securities Exchange Act of 1934, as amended from time
to time.
Federal Funds Rate means, for any day, the rate per annum (rounded upward, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published
by the Federal Reserve Bank of New York on the Domestic Business Day next
succeeding such day, provided that (i) if such day is not a Domestic Business
Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published
on the next succeeding Domestic Business Day and (ii) if no such rate is
so published on such next succeeding Domestic Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to Citibank, N.A.
on such day on such transactions as determined by the Administrative Agent.
Fiscal Quarter means a fiscal quarter of the Borrower.
Fiscal Year means a fiscal year of the Borrower.
GAAP means generally accepted accounting principles as in effect from time to
time, applied on a basis consistent (except for changes concurred in by the
Borrower's independent public accountants) with the most recent audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries delivered to the Banks.
Group of Loans means, at any time, a group of Loans consisting of (i) all
Loans which are Base Rate Loans at such time or (ii) all Euro-Dollar Loans
having the same Interest Period at such time, provided that, if a Loan of
any particular Bank is converted to or made as a Base Rate Loan pursuant to
Article 8, such Loan shall be included in the same Group or Groups of Loans
from time to time as it would have been in if it had not been so converted
or made.
Guarantee by any Person means any obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing any Debt or other obligation of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt or other obligation (whether arising by virtue of partnership
arrangements, by agreement to keep-well, to purchase assets, goods, securities
or services, to take-or-pay, or to maintain financial statement conditions or
otherwise), (ii) to reimburse a bank for amounts drawn under a letter of
credit for the purpose of paying such Debt or (iii) entered into for the
purpose of assuring in any other manner the holder of such Debt or other
obligation of the payment thereof or to protect such holder against loss in
respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business. The term Guarantee used as a verb has a corresponding meaning.
Hazardous Substances means any toxic, radioactive, caustic or otherwise
hazardous substance, including petroleum, its derivatives, by-products and
other hydrocarbons, or any substance having any constituent elements
displaying any of the foregoing characteristics.
Indemnitee has the meaning set forth in Section 9.03(b).
Information Memorandum means the confidential descriptive memorandum dated
January 1997 furnished to the Banks in connection with the transactions
contemplated hereby.
Interest Period means: (1) with respect to each Euro-Dollar Loan, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing or on the date specified in an applicable Notice of Interest Rate
Election and ending one, two, three or six months thereafter, as the Borrower
may elect in such notice; provided that
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding Euro-
Dollar Business Day unless such Euro-Dollar Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (c) below, end on the last Euro-Dollar
Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date.
Internal Revenue Code means the Internal Revenue Code of 1986, as amended, or
any successor statute.
Investment means any investment in any Person, whether by means of share
purchase, capital contribution, loan, Guarantee, time deposit or otherwise
(but not including any demand deposit).
Lien means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind, or any other type of
preferential arrangement that has substantially the same practical effect as
a security interest, in respect of such asset. For purposes hereof, the
Borrower or any Subsidiary shall be deemed to own subject to a Lien any asset
which it has acquired or holds subject to the interest of a vendor or lessor
under any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
Loan means a loan made by a Bank pursuant to Section 2.01.
Loan Documents means this Agreement, the Notes and the Collateral Documents.
London Interbank Offered Rate has the meaning set forth in Section 2.04(b).
Material Adverse Effect means (i) any material adverse effect upon the
condition (financial or otherwise), results of operations, properties, assets
or business of the Borrower and its Subsidiaries, taken as a whole; (ii) a
material adverse effect on the ability of the Borrower or any other Person
to consummate the transactions contemplated hereby to occur on the Closing
Date; (iii) a material adverse effect on the ability of the Borrower to
perform under this Agreement and the Notes and the other Loan Documents; or
(iv) a material adverse effect on the rights and remedies of the Agents and
the Banks under this Agreement and the Notes and the other Loan Documents.
Material Debt means Debt (except Debt outstanding hereunder) of the Borrower
and/or one or more of its Subsidiaries, arising in one or more related or
unrelated transactions, in an aggregate principal or face amount exceeding
$5,000,000.
Material Financial Obligations means a principal or face amount of Debt
and/or payment or collateralization obligations in respect of Derivatives
Obligations of the Borrower and/or one or more of its Subsidiaries, arising
in one or more related or unrelated transactions, exceeding in the aggregate
$5,000,000.
Material Plan means, at any time, a Plan or Plans having aggregate Unfunded
Liabilities in excess of $5,000,000.
Multiemployer Plan means, at any time, an employee pension benefit plan within
the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during
such five year period.
Notes means promissory notes of the Borrower, substantially in the form of
Exhibit A hereto, evidencing the Borrower's obligation to repay the Loans,
and Note means any one of such promissory notes issued hereunder.
Notice of Borrowing has the meaning set forth in Section 2.02.
Notice of Interest Rate Election has the meaning set forth in Section 2.05.
Parent means, with respect to any Bank, any Person controlling such Bank.
Participant has the meaning set forth in Section 9.06(b).
PBGC means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.
Person means an individual, a corporation, a limited liability company, a
partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or
instrumentality thereof.
Plan means, at any time, an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person
which was at such time a member of the ERISA Group for employees of any
Person which was at such time a member of the ERISA Group.
Pledge Agreement means the pledge agreement dated as of the Closing Date
substantially in the form of Exhibit F hereto between the Borrower and the
Security Agent, as amended from time to time.
Pricing Schedule means the Pricing Schedule attached hereto.
Prime Rate means the rate of interest publicly announced by Citibank, N.A.
in New York City from time to time as its Prime Rate.
Quarterly Payment Dates means each March 31, June 30, September 30 and
December 31.
Reference Banks means the principal London offices of Fleet National Bank,
Citibank, N.A. and Xxxxxx Guaranty Trust Company of New York, and
Reference Bank means any one of such Reference Banks.
Regulation U means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
Required Banks means, at any time, Banks having at least 51% of the aggregate
amount of the Commitments or, if the Commitments shall have terminated,
holding at least 51% of the aggregate unpaid principal amount of the Loans.
Restricted Payment means (i) any dividend or other distribution on any shares
of the Borrower's capital stock (except dividends payable solely in shares of
its capital stock other than mandatorily redeemable preferred stock) or (ii)
any payment on account of the purchase, redemption, retirement or acquisition
of (a) any shares of the Borrower's capital stock or (b) any option, warrant
or other right to acquire shares of the Borrower's capital stock (but not
including payments of principal, premium (if any) or interest made pursuant
to the terms of convertible debt securities prior to conversion).
Revolving Credit Period means the period from and including the Effective
Date to but not including the Termination Date.
SEC means the Securities and Exchange Commission.
Security Agent means Citicorp USA, Inc., in its capacity as agent for the
Banks under the Collateral Documents, and its successors in such capacity.
Security Agreement means the security agreement dated as of the Closing
Date substantially in the form of Exhibit E hereto among the Borrower, the
Security Agent and Xxxxx Fargo Bank, N.A., as Concentration Bank, as amended
from time to time.
Subsidiary means, as to any Person, any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect
a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person. Unless
otherwise specified, Subsidiary means a Subsidiary of the Borrower.
Temporary Cash Investment means any Investment in (i) direct obligations of
the United States or any agency thereof or obligations guaranteed by the
United States or any agency thereof, (ii) commercial paper rated at least A-1
by Standard & Poor's Ratings Services or P-1 by Xxxxx'x Investors Service,
Inc., (iii) time deposits with, including certificates of deposit issued by,
any office located in the United States of any bank or trust company which is
organized or licensed under the laws of the United States or any State thereof
and has capital, surplus and undivided profits aggregating at least
$1,000,000,000, (iv) repurchase agreements with respect to securities
described in clause (i) above entered into with an office of a bank or trust
company meeting the criteria specified in clause (iii) above, or (v) any other
obligation which meets the criteria established in the Borrower's U.S. cash
investment policy as in effect on the date hereof.
Termination Date means March 11, 2000, or, if such day is not a Euro-Dollar
Business Day, the next succeeding Euro-Dollar Business Day unless such Euro-
Dollar Business Day falls in another calendar month, in which case the
Termination Date shall be the next preceding Euro-Dollar Business Day.
Unfunded Liabilities means, with respect to any Plan at any time, the amount
(if any) by which (i) the value of all benefit liabilities under such Plan,
determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title IV of
ERISA (excluding any accrued but unpaid contributions), all determined as of
the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA
Group to the PBGC or any other Person under Title IV of ERISA.
United States means the United States of America.
SECTION 1.2. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial
statements required to be delivered hereunder shall be prepared in accordance
with GAAP; provided that, if the Borrower notifies the Administrative Agent
that the Borrower wishes to amend any provision hereof to eliminate the effect
of any change in GAAP on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Banks wish to
amend any provision hereof for such purpose), then the Borrower's compliance
with such provision shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such provision is amended in a manner satisfactory
to the Borrower and the Required Banks.
ARTICLE 2
THE CREDITS
SECTION 2.1. Commitments to Lend. Each Bank severally agrees, on the terms
and conditions set forth in this Agreement, to make loans to the Borrower
from time to time during the Revolving Credit Period; provided that,
immediately after each such loan is made, the aggregate outstanding principal
amount of all Loans by such Bank shall not exceed its Commitment. Each
Borrowing under this Section shall be in an aggregate principal amount of
$5,000,000 or any larger multiple of $1,000,000 (except that any such
Borrowing may be in the aggregate amount of the unused Commitments) and
shall be made from the several Banks ratably in proportion to their
respective Commitments. Within the foregoing limits, the Borrower may
borrow under this Section, prepay Loans to the extent permitted by Section
2.08 and reborrow at any time during the Revolving Credit Period under this
Section.
SECTION 2.2. Method of Borrowing. (a) The Borrower shall give the
Administrative Agent notice (a Notice of Borrowing) not later than 12:00
Noon (New York City time) on (x) the date of each Base Rate Borrowing and
(y) the third Euro-Dollar Business Day before each Euro-Dollar Borrowing,
specifying:
(i) the date of such Borrowing, which shall be a Domestic Business Day in the
case of a Base Rate Borrowing or a Euro-Dollar Business Day in the case of a
Euro-Dollar Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing are to bear interest
initially at the Base Rate or a Euro-Dollar Rate; and
(iv) in the case of a Euro-Dollar Borrowing, the duration of the initial
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
In no event shall the total number of Groups of Loans at any one time
outstanding exceed twenty.
(b) Promptly after receiving a Notice of Borrowing, the Administrative
Agent shall notify each Bank of the contents thereof and of such Bank's
ratable share of such Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the Borrower.
(c) Not later than 1:00 P.M. (New York City time) on the date of each Euro-
Dollar Borrowing or 2:00 P.M. (New York City time) on the date of each Base
Rate Borrowing, each Bank shall make available its ratable share of such
Borrowing, in Federal or other funds immediately available in New York City,
to the Administrative Agent at its address specified in or pursuant to Section
9.01. Unless the Administrative Agent determines that any applicable
condition specified in Article 3 has not been satisfied, the Administrative
Agent will make the funds so received from the Banks available to the
Borrower at the Administrative Agent's aforesaid address.
(d) Unless the Administrative Agent shall have received notice from a Bank
before the date of any Borrowing (or, in the case of a Base Rate Borrowing,
prior to 1:30 P.M.(New York City time) on the date of such Borrowing) that
such Bank will not make available to the Administrative Agent such Bank's
share of such Borrowing, the Administrative Agent may assume that such Bank
has made such share available to the Administrative Agent on the date of
such Borrowing in accordance with subsection (b) of this Section and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that
such Bank shall not have so made such share available to the Administrative
Agent, such Bank and the Borrower severally agree to repay to the
Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) if such amount is repaid by the Borrower, a rate
per annum equal to the higher of the Federal Funds Rate and the interest rate
applicable thereto pursuant to Section 2.04 and (ii) if such amount is repaid
by such Bank, the Federal Funds Rate. If such Bank shall repay to the
Administrative Agent such corresponding amount, the Borrower shall not be
required to repay such amount and the amount so repaid by such Bank shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.3. Maturity of Loans. (a) Each Loan shall mature, and the
principal amount thereof shall be due and payable (together with interest
accrued thereon), on the Termination Date.
(b) If at any time the aggregate outstanding principal amount of the Loans
exceeds the Borrowing Base, the Borrower shall prepay on the next succeeding
Domestic Business Day a principal amount of Loans equal to such excess.
SECTION 2.4. Interest Rates. (a) Each Base Rate Loan shall bear interest
on the outstanding principal amount thereof, for each day from the date such
Loan is made until it becomes due, at a rate per annum equal to the sum of (x)
the Base Rate Margin (as determined in accordance with the Pricing Schedule)
plus (y) the Base Rate for such day. Such interest shall be payable quarterly
in arrears on each Quarterly Payment Date and, with respect to the principal
amount of any Base Rate Loan converted to a Euro-Dollar Loan, on the date such
amount is so converted. Any overdue principal of or interest on any Base Rate
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of 2% plus the Base Rate Margin for such day plus
the Base Rate for such day.
(b) Each Euro-Dollar Loan shall bear interest on the outstanding principal
amount thereof, for each day during each Interest Period applicable thereto, at
a rate per annum equal to the sum of the Euro-Dollar Margin for such day plus
the Adjusted London Interbank Offered Rate applicable to such Interest Period.
Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than three months, at intervals
of three months after the first day thereof.
Euro-Dollar Margin means a rate per annum determined in accordance with the
Pricing Schedule.
The Adjusted London Interbank Offered Rate applicable to any Interest Period
means a rate per annum equal to the quotient obtained (rounded upward, if
necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable
London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve
Percentage.
The London Interbank Offered Rate applicable to any Interest Period means the
average (rounded upward, if necessary, to the next higher 1/16 of 1%) of the
respective rates per annum at which deposits in dollars are offered to each
of the Reference Banks in the London interbank market at approximately 11:00
A.M. (London time) two Euro-Dollar Business Days before the first day of such
Interest Period in an amount approximately equal to the principal amount of
the Euro-Dollar Loan of such Reference Bank to which such Interest Period is
to apply and for a period of time comparable to such Interest Period.
(c) Any overdue principal of or interest on any Euro-Dollar Loan shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the higher of (i) the sum of 2% plus the Euro-Dollar Margin for such day
plus the Adjusted London Interbank Offered Rate applicable to such Loan on the
day before such payment was due and (ii) the sum of 2% plus the Euro-Dollar
Margin for such day plus a rate per annum equal to the quotient obtained
(rounded upward, if necessary, to the next higher 1/100 of 1%) by dividing
(x) the average (rounded upward, if necessary, to the next higher 1/16 of 1%)
of the respective rates per annum at which one day (or, if such amount due
remains unpaid more than three Euro-Dollar Business Days, then for such other
period of time not longer than three months as the Administrative Agent may
select) deposits in dollars in an amount approximately equal to such overdue
payment due to each of the Reference Banks are offered to such Reference Bank
in the London interbank market for the applicable period determined as
provided above by (y) 1.00 minus the Euro-Dollar Reserve Percentage (or, if
the circumstances described in clause (a) or (b) of Section 8.01 shall exist,
at a rate per annum equal to the sum of 2% plus the Base Rate for such day).
(d) The Administrative Agent shall determine each interest rate applicable
to the Loans hereunder. The Administrative Agent shall promptly notify the
Borrower and the participating Banks of each rate of interest so determined,
and its determination thereof shall be conclusive in the absence of manifest
error.
(e) Each Reference Bank agrees to use its best efforts to furnish quotations
to the Administrative Agent as contemplated by this Section. If any Reference
Bank does not furnish a timely quotation, the Administrative Agent shall
determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Banks or, if none of
such quotations is available on a timely basis, the provisions of Section 8.01
shall apply.
SECTION 2.5. Method of Electing Interest Rates. (a) The Loans included in
each Borrowing shall bear interest initially at the type of rate specified by
the Borrower in the applicable Notice of Borrowing. Thereafter, the Borrower
may from time to time elect to change or continue the type of interest rate
borne by each Group of Loans (subject to subsection (d) of this Section and
the provisions of Article 8), as follows:
(i) if such Loans are Base Rate Loans, the Borrower may elect to convert such
Loans to Euro-Dollar Loans as of any Euro-Dollar Business Day and
(ii) if such Loans are Euro-Dollar Loans, the Borrower may elect to convert
such Loans to Base Rate Loans or elect to continue such Loans as Euro-Dollar
Loans for an additional Interest Period, subject to Section 2.10 if any such
conversion is effective on any day other than the last day of an Interest
Period applicable to such Loans.
Each such election shall be made by delivering a notice (a Notice of Interest
Rate Election) to the Administrative Agent not later than 10:30 A.M. (New
York City time) on the third Euro-Dollar Business Day before the conversion
or continuation selected in such notice is to be effective. A Notice of
Interest Rate Election may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that (i)
such portion is allocated ratably among the Loans comprising such Group and
(ii) the portion to which such Notice applies, and the remaining portion to
which it does not apply, are each at least $5,000,000 (unless such portion is
comprised of Base Rate Loans). If no such notice is timely received before
the end of an Interest Period for any Group of Euro-Dollar Loans, the Borrower
shall be deemed to have elected that such Group of Loans be converted to Base
Rate Loans at the end of such Interest Period.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which such notice applies;
(ii) the date on which the conversion or continuation selected in such notice
is to be effective, which shall comply with the applicable clause of
subsection (a) above;
(iii) if the Loans comprising such Group are to be converted, the new type
of Loans and, if the Loans resulting from such conversion are to be Euro-
Dollar Loans, the duration of the next succeeding Interest Period applicable
thereto; and
(iv) if such Loans are to be continued as Euro-Dollar Loans for an additional
Interest Period, the duration of such additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Promptly after receiving a Notice of Interest Rate Election from the
Borrower pursuant to subsection (a) above, the Administrative Agent shall
notify each Bank of the contents thereof and such notice shall not thereafter
be revocable by the Borrower.
(d) The Borrower shall not be entitled to elect to convert any Loans to, or
continue any Loans for an additional Interest Period as, Euro-Dollar Loans if
(i) the aggregate principal amount of any Group of Euro-Dollar Loans created
or continued as a result of such election would be less than $5,000,000 or
(ii) a Default shall have occurred and be continuing when the Borrower
delivers notice of such election to the Administrative Agent.
SECTION 2.6. Fees. The Borrower shall pay to the Administrative Agent,
for the account of the Banks ratably in proportion to their Commitments, a
commitment fee at the Commitment Fee Rate (determined daily in accordance with
the Pricing Schedule) per annum on the daily average amount by which the
aggregate amount of the Commitments exceeds the aggregate outstanding
principal amount of the Loans. Such commitment fee shall accrue from and
including the Effective Date to but excluding the date on which the
Commitments terminate in their entirety, and shall be payable quarterly in
arrears on each Quarterly Payment Date and on the date on which the
Commitments terminate in their entirety.
SECTION 2.7. Termination or Reduction of Commitments. (a) The Borrower
may, upon at least three Domestic Business Days' notice to the Administrative
Agent, (i) terminate the Commitments at any time, if no Loans are outstanding
at such time, or (ii) ratably reduce from time to time, by an aggregate amount
of at least $25,000,000, the aggregate amount of the Commitments in excess of
the aggregate outstanding principal amount of the Loans. Promptly after
receiving a notice pursuant to this subsection, the Administrative Agent
shall notify each Bank of the contents thereof.
(b) Unless previously terminated, the Commitments shall terminate in their
entirety on the Termination Date.
SECTION 2.8. Optional Prepayments. (a) Subject in the case of Euro-Dollar
Loans to Section 2.10, the Borrower may, upon at least one Domestic Business
Day's notice to the Administrative Agent, prepay any Group of Base Rate Loans
or upon at least three Euro-Dollar Business Days' notice to the Administrative
Agent, prepay any Group of Euro-Dollar Loans, in each case in whole at any
time, or from time to time in part in amounts aggregating $5,000,000 or any
larger multiple of $1,000,000, by paying the principal amount to be prepaid
together with interest accrued thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Loans of the
several Banks included in such Group of Loans.
(b) Promptly after receiving a notice of prepayment pursuant to this Section,
the Administrative Agent shall notify each Bank of the contents thereof and
of such Bank's ratable share of such prepayment, and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.9. General Provisions as to Payments. (a) The Borrower shall
make each payment of principal of, and interest on, the Loans and of fees
hereunder not later than 1:00 P.M. (New York City time) on the date when due,
in Federal or other funds immediately available in New York City, to the
Administrative Agent at its address specified in or pursuant to Section 9.01.
The Administrative Agent will promptly distribute to each Bank its ratable
share of each such payment received by the Administrative Agent for the
account of the Banks. Whenever any payment of principal of, or interest on,
the Base Rate Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to
the next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case the date for payment
thereof shall be the next preceding Euro-Dollar Business Day. If the date
for any payment of principal is extended by operation of law or otherwise,
interest thereon shall be payable for such extended time.
(b) Unless the Borrower notifies the Administrative Agent before the date
on which any payment is due to the Banks hereunder that the Borrower will not
make such payment in full, the Administrative Agent may assume that the
Borrower has made such payment in full to the Administrative Agent on such
date and the Administrative Agent may, in reliance on such assumption, cause
to be distributed to each Bank on such due date an amount equal to the amount
then due such Bank. If and to the extent that the Borrower shall not have so
made such payment, each Bank shall repay to the Administrative Agent
forthwith on demand such 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 Administrative
Agent, at the Federal Funds Rate.
SECTION 2.10. Funding Losses. If the Borrower makes any payment of
principal with respect to any Euro-Dollar Loan, or any Euro-Dollar Loan is
converted to a Base Rate Loan (whether such payment or conversion is
pursuant to Article 2, 6 or 8 or otherwise), on any day other than the last
day of an Interest Period applicable thereto, or the last day of an
applicable period fixed pursuant to Section 2.04(c), or if the Borrower
fails to borrow, prepay, convert or continue any Euro-Dollar Loans after
notice has been given to any Bank in accordance with Section 2.02(b),
2.05(c) or 2.08(b), the Borrower shall reimburse each Bank within 15 days
after demand for any resulting loss or expense incurred by it (or by an
existing or prospective Participant which has purchased or agreed to
purchase a participation in the related Loan), including (without limitation)
any loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after such payment or
conversion or failure to borrow, prepay, convert or continue; provided that
such Bank shall have delivered to the Borrower a certificate as to the
amount of such loss or expense, which certificate shall be conclusive in
the absence of manifest error.
SECTION 2.11. Computation of Interest and Fees. All interest and fees shall
be computed on the basis of a year of 360 days and paid for the actual number
of days elapsed (including the first day but excluding the last day).
SECTION 2.12. Notes. (a) The Borrower's obligation to repay the Loans
of each Bank shall be evidenced by a single Note payable to the order of such
Bank for the account of its Applicable Lending Office
(b) Each Bank may, by notice to the Borrower and the Administrative Agent,
request that the Borrower's obligation to repay such Bank's Loans of a
particular type be evidenced by a separate Note. Each such Note shall be in
substantially the form of Exhibit A hereto with appropriate modifications to
reflect the fact that it relates solely to Loans of the relevant type. Each
reference in this Agreement to the Note of such Bank shall be deemed to
refer to and include any or all of such Notes, as the context may require.
(c) Promptly after it receives each Bank's Note pursuant to Section 3.01(a),
the Documentation Agent shall forward such Note to such Bank. Each Bank
shall record the date, amount and type of each Loan made by it and the date
and amount of each payment of principal made by the Borrower with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding; provided that a Bank's failure to make any
such recordation or endorsement shall not affect the Borrower's obligations
hereunder or under the Notes. Each Bank is hereby irrevocably authorized
by the Borrower so to endorse its Note and to attach to and make a part of
its Note a continuation of any such schedule as and when required.
ARTICLE 3
CONDITIONS
SECTION 3.1. Closing. The closing hereunder shall occur when the
Documentation Agent has received all the following documents, each dated the
Closing Date unless otherwise indicated:
(a) a duly executed Note for the account of each Bank dated on or before
the Closing Date and complying with the provisions of Section 2.12;
(b) an opinion of Xxxx and Xxxx LLP, counsel for the Borrower,
substantially in the form of Exhibit B hereto, and covering such additional
matters relating to the transactions contemplated hereby as the Required
Banks may reasonably request;
(c) an opinion of Xxxxx Xxxx & Xxxxxxxx, special counsel for the Agents,
substantially in the form of Exhibit C hereto and covering such additional
matters relating to the transactions contemplated hereby as the Required
Banks may reasonably request;
(d) duly executed counterparts of each of the Collateral Documents, together
with evidence satisfactory to the Agents of the effectiveness and perfection
(to the extent required thereby) of the Liens contemplated thereby, including
the filing of UCC-1's and the delivery of any stock certificates comprising
the Collateral;
(e) evidence satisfactory to it of (i) the repayment in full, not later than
the Closing Date, of all loans (if any) and other amounts outstanding under
the Loan Agreement dated as of July 5, 1995, as amended, between the Borrower
and Xxxxx Fargo Bank, N.A., and the Factoringvertrag dated November 10, 1995,
as amended, between Xxxxxx Bank A.G. and Iomega International S.A.
(collectively, the Existing Credit Agreements), together with interest
accrued thereon to the Closing Date and all accrued and unpaid commitment
fees and all other amounts due and payable under the Existing Credit
Agreements, and the release of all Liens relating thereto, and (ii) receipt by
such banks of irrevocable notice of the termination of the commitments under
the Existing Credit Agreements, not later than the Closing Date, which notice
shall also state that no further notices of borrowing will be delivered
thereunder;
(f) evidence satisfactory to it that all fees and expenses payable for the
account of the Banks and the Agents and their affiliates on or before the
Closing Date have been paid in full in the amounts previously agreed upon on
or before the Closing Date; and
(g) all documents the Documentation Agent may reasonably request relating to
the existence of the Borrower, the corporate authority for and the validity
of the Loan Documents, and any other matters relevant hereto, all in form and
substance satisfactory to the Documentation Agent.
Promptly after the Closing Date occurs, the Documentation Agent shall notify
the Borrower, the Administrative Agent and the Banks thereof, and such notice
shall be conclusive and binding on all parties hereto.
SECTION 3.2. Borrowings. The obligation of any Bank to make a Loan on the
occasion of any Borrowing is subject to the satisfaction of the following
conditions:
(a) the fact that the Closing Date shall have occurred on or before April
30, 1997;
(b) receipt by the Administrative Agent of a Notice of Borrowing as
required by Section 2.02;
(c) the fact that, immediately after such Borrowing, the aggregate
outstanding principal amount of the Loans will not exceed the lesser of the
aggregate Commitments and the Borrowing Base;
(d) the fact that, immediately before and after such Borrowing, no Default
shall have occurred and be continuing; and
(e) the fact that the representations and warranties of the Borrower
contained in this Agreement shall be true on and as of the date of such
Borrowing.
Each Borrowing hereunder shall be deemed to be a representation and warranty
by the Borrower on the date of such Borrowing as to the facts specified in
clauses (c), (d) and (e) of this Section.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.1. Corporate Existence and Power. The Borrower is a corporation
duly incorporated, validly existing and in good standing under the laws of
the jurisdiction of its incorporation, and has all corporate powers and all
material governmental licenses, consents, authorizations and approvals
required to carry on its business as now conducted.
SECTION 4.2. Corporate and Governmental Authorization; No Contravention.
The execution, delivery and performance by the Borrower of the Loan Documents
are within the Borrower's corporate powers, have been duly authorized by all
necessary corporate action, require no action by or in respect of, or filing
with, any governmental body, agency or official (other than in connection
with the Collateral Documents) and do not contravene, or constitute a default
under, any provision of applicable law or regulation or of the Borrower's
certificate of incorporation or by-laws or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Borrower or
any Subsidiary, the contravention of which instrument or default under which
instrument could reasonably be expected to have a Material Adverse Effect,
or result in the creation or imposition of any Lien on any asset of the
Borrower or any Subsidiary.
SECTION 4.3. Binding Effect. The Loan Documents (other than the Notes)
constitute valid and binding agreements of the Borrower and each Note, when
executed and delivered in accordance with this Agreement, will constitute a
valid and binding obligation of the Borrower, in each case enforceable in
accordance with its terms except (i) as may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii)
as rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability.
SECTION 4.4. Financial Information. (a) The consolidated balance sheet
of the Borrower and its Consolidated Subsidiaries as of December 31, 1996 and
the related consolidated statements of operations, stockholders= equity and
cash flows for the Fiscal Year then ended, reported on by Xxxxxx Xxxxxxxx
LLP , a copy of which financial statements has been delivered to each of the
Banks, fairly present, in conformity with GAAP, the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such date
and their consolidated results of operations and cash flows for such Fiscal
Year.
(b) Since December 31, 1996 there has been no material adverse change in the
business, financial position, results of operations or prospects of the
Borrower and its Consolidated Subsidiaries, considered as a whole.
SECTION 4.5. Litigation. There is no action, suit or proceeding pending
against, or to the Borrower's knowledge threatened against or affecting, the
Borrower or any Subsidiary before any court or arbitrator or any governmental
body, agency or official in which there is a reasonable possibility of an
adverse decision which could materially adversely affect the business,
consolidated financial position or consolidated results of operations of the
Borrower and its Consolidated Subsidiaries, considered as a whole, or which
in any manner draws into question the validity or enforceability of the Loan
Documents.
SECTION 4.6. Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and
the Internal Revenue Code with respect to each Plan and is in compliance in
all material respects with the presently applicable provisions of ERISA and
the Internal Revenue Code with respect to each Plan. No member of the
ERISA Group has (i) sought a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code in respect of any Plan, (ii) failed
to make any contribution or payment to any Plan or Multiemployer Plan, or
made any amendment to any Plan, which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security under ERISA
or the Internal Revenue Code or (iii) incurred any liability under Title IV
of ERISA other than a liability to the PBGC for premiums under Section 4007
of ERISA.
SECTION 4.7. Environmental Matters. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital
or operating expenditures required for clean-up or closure of properties
presently or previously owned, any capital or operating expenditures required
to achieve or maintain compliance with environmental protection standards
imposed by law or as a condition of any license, permit or contract, any
related constraints on operating activities, including any periodic or
permanent shutdown of any facility or reduction in the level of or change in
the nature of operations conducted thereat, any costs or liabilities in
connection with off-site disposal of wastes or Hazardous Substances and any
actual or potential liabilities to third parties, including employees, and
any related costs and expenses). On the basis of this review, the Borrower
has reasonably concluded that such associated liabilities and costs, including
the costs of complying with Environmental Laws, are unlikely to have a
material adverse effect on the business, financial condition or results of
operations of the Borrower and its Consolidated Subsidiaries, considered as
a whole.
SECTION 4.8. Taxes. The Borrower and its Subsidiaries have filed all
United States Federal income tax returns and all other material tax returns
which are required to be filed by them and have paid all taxes due pursuant
to such returns or pursuant to any assessment received by the Borrower or
any Subsidiary. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of taxes or other governmental
charges are, in the Borrower's opinion, adequate.
SECTION 4.9. Subsidiaries. Each of the Borrower's corporate Subsidiaries is
a corporation duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation, and has all corporate powers
and all material governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted.
SECTION 4.10. Regulatory Restrictions on Borrowing. The Borrower is not
(i) an investment company within the meaning of the Investment Company Act
of 1940, as amended, (ii) a holding company within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or (iii) otherwise
subject to any regulatory scheme which restricts its ability to incur debt.
SECTION 4.11. Full Disclosure. (a) All information heretofore furnished
by the Borrower to the Agents or any Bank for purposes of or in connection
with this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished by the Borrower to the Agents or any Bank
will be, true and accurate in all material respects on the date as of which
such information is stated or certified. The Borrower has disclosed to the
Banks any and all facts which materially and adversely affect, or may
materially and adversely affect (to the extent the Borrower can now
reasonably foresee), the business, operations or financial condition of
the Borrower and its Consolidated Subsidiaries, taken as a whole, or the
Borrower's ability to perform its obligations under the Loan Documents.
(b) The projections set forth in the Information Memorandum were based on
reasonable assumptions and as of their date represented the best estimate of
future performance of the Borrower and its Subsidiaries. During the period
from the respective dates as of which information is stated in the
Information Memorandum to and including the Closing Date, no event has
occurred and no condition has come into existence which would have caused
the projections therein to be materially misleading.
SECTION 4.12. Representations in Collateral Documents True and Correct.
Each of the representations and warranties of the Borrower contained in the
Collateral Documents is true and correct.
ARTICLE 5
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any principal of or interest on any Loan remains unpaid:
SECTION 5.1. Information. The Borrower will deliver to each of the Banks:
(a) as soon as available and in any event within 90 days after the end of
each Fiscal Year, a consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of the end of such Fiscal Year and the related
consolidated statements of operations, stockholders= equity and cash flows
for such Fiscal Year, setting forth in each case in comparative form the
figures for the previous Fiscal Year, all reported on in a manner acceptable
to the SEC by Xxxxxx Xxxxxxxx LLP or other independent public accountants
of nationally recognized standing;
(b) as soon as available and in any event within 45 days after the end of
each of the first three Fiscal Quarters of each Fiscal Year, a consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of the
end of such Fiscal Quarter, the related consolidated statement of operations
for such Fiscal Quarter and the related consolidated statements of operations
and cash flows for the portion of the Fiscal Year ended at the end of such
Fiscal Quarter, setting forth in the case of each such statement of
operations and cash flows in comparative form the figures for the
corresponding period in the previous Fiscal Year, all certified (subject to
normal year-end adjustments) as to fairness of presentation and consistency
with GAAP by the Borrower's chief financial officer or chief accounting
officer;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate of the Borrower's
chief financial officer or chief accounting officer (i) setting forth in
reasonable detail the calculations required to establish whether the Borrower
was in compliance with the requirements of Sections 5.09 to 5.16, inclusive,
and the calculation of the Borrowing Base on the date of such financial
statements and (ii) stating whether any Default exists on the date of such
certificate and, if any Default then exists, setting forth the details
thereof and the action which the Borrower is taking or proposes to take with
respect thereto;
(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above, a statement of the firm of independent
public accountants which reported on such statements stating whether anything
has come to their attention to cause them to believe that (i) any Default
existed on the date of such statements and (ii) the calculations set forth
in the officer's certificate delivered simultaneously therewith pursuant to
clause (c) above are not correct;
(e) within five Domestic Business Days after any officer of the Borrower
obtains knowledge of any Default, if such Default is then continuing, a
certificate of the Borrower's chief financial officer or chief accounting
officer setting forth the details thereof and the action which the Borrower
is taking or proposes to take with respect thereto;
(f) as soon as reasonably practicable after any officer of the Borrower
obtains knowledge thereof, notice of any event or condition which has had
or could reasonably be expected to have a Material Adverse Effect and the
nature of such Material Adverse Effect;
(g) as soon as reasonably practicable after any officer of the Borrower
obtains knowledge of the commencement of, or of a threat of the commencement
of, an action, suit or proceeding against the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency
or official in which there is a reasonable likelihood of an adverse decision
which could have a Material Adverse Effect or which in any manner questions
the validity of the Loan Documents, a certificate of a senior financial
officer of the Borrower setting forth the nature of such pending or
threatened action, suit or proceeding and such additional information with
respect thereto as may be reasonably requested by any Bank;
(h) promptly after the mailing thereof to the Borrower's shareholders
generally, copies of all financial statements, reports and proxy statements
so mailed;
(i) promptly after the filing thereof, copies of all registration statements
(other than the exhibits thereto and any registration statements on Form S-8
or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents) filed by the Borrower with the SEC;
(j) if and when any member of the ERISA Group (i) gives or is required to
give notice to the PBGC of any reportable event (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of
such notice; (iii) receives notice from the PBGC under Title IV of ERISA of
an intent to terminate, impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or appoint a trustee to administer any
Plan, a copy of such notice; (iv) applies for a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code, a copy of
such application; (v) gives notice of intent to terminate any Plan under
Section 4041(c) of ERISA, a copy of such notice and other information filed
with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to
Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any
payment or contribution to any Plan or Multiemployer Plan or makes any
amendment to any Plan which has resulted or could result in the imposition of
a Lien or the posting of a bond or other security, a certificate of the
Borrower's chief financial officer or chief accounting officer setting forth
details as to such occurrence and the action, if any, which the Borrower or
applicable member of the ERISA Group is required or proposes to take;
(k) within 30 days after the commencement of each Fiscal Year, the Borrower's
operating and capital expenditure budgets and cash flow forecast on a
quarterly basis for such Fiscal Year and on an annual basis for the
succeeding Fiscal Years through the Termination Date; and
(l) from time to time such additional information regarding the financial
position or business of the Borrower and its Subsidiaries as either Agent, at
the request of any Bank, may reasonably request.
SECTION 5.2. Payment of Obligations. The Borrower will pay and discharge,
and will cause each Subsidiary to pay and discharge, at or before maturity,
all their respective material obligations and liabilities (including, without
limitation, tax liabilities and claims of materialmen, warehousemen and the
like which if unpaid might by law give rise to a Lien), except where the same
are contested in good faith, and will maintain, and will cause each Subsidiary
to maintain, in accordance with GAAP, if and to the extent appropriate,
reserves for the accrual thereof.
SECTION 5.3. Maintenance of Property; Insurance. (a) The Borrower will
keep, and will cause each Subsidiary to keep, all property useful and
necessary in its business in reasonably good working order and condition,
ordinary wear and tear excepted.
(b) The Borrower will, and will cause each Subsidiary to, maintain (either
in the Borrower's name or in such Subsidiary's own name) with financially
sound and responsible insurance companies, insurance on all their respective
material properties in at least such amounts, against at least such risks
and with no greater risk retention as are usually maintained, insured against
or retained, as the case may be, in the same general area by companies of
established repute engaged in the same or a similar business. The Borrower
will furnish to the Banks, upon request from the Administrative Agent,
information presented in reasonable detail as to the insurance so carried.
SECTION 5.4. Conduct of Business and Maintenance of Existence. The
Borrower and its Subsidiaries will continue to engage in business of the
same general type as now conducted by the Borrower and its Subsidiaries, and
will preserve, renew and keep in full force and effect their respective
corporate existences and their respective rights, privileges and franchises
necessary or desirable in the normal conduct of business; provided that
nothing in this Section shall prohibit:
(i) the merger of a Subsidiary into the Borrower if, after giving effect
thereto, no Default shall have occurred and be continuing;
(ii) the merger or consolidation of a Subsidiary with or into a Person other
than the Borrower if the corporation surviving such consolidation or merger
is a Subsidiary and, after giving effect thereto, no Default shall have
occurred and be continuing; or
(iii) the termination of the corporate existence of a Subsidiary if the
Borrower in good faith determines that such termination is in the best
interest of the Borrower and is not materially disadvantageous to the Banks.
The Borrower will not modify its policy for classification of doubtful
accounts in any manner materially detrimental to the interests of the Banks
(including, without limitation, in any manner which would result in an
increase in the Borrowing Base) without the consent of the Required Banks.
SECTION 5.5. Compliance with Laws. The Borrower will comply, and will cause
each Subsidiary to comply, in all respects with all applicable laws,
ordinances, rules, regulations and requirements of governmental authorities
(including, without limitation, Environmental Laws and ERISA and the rules
and regulations thereunder), except (i) where the necessity of compliance
therewith is contested in good faith by appropriate proceedings or (ii)
where such noncompliance could not reasonably be expected to have a Material
Adverse Effect.
SECTION 5.6. Inspection of Property, Books and Records. The Borrower will
keep, and will cause each Subsidiary to keep, proper books of record and
account in which full and correct entries shall be made of all dealings and
transactions in relation to its business and activities; and will permit,
and will cause each Subsidiary to permit, representatives of any Bank at such
Bank's expense to visit and inspect any of their respective properties, to
examine and make abstracts from any of their respective books and records and
to discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants, all at such
reasonable times (including reasonable notice) and as often as may reasonably
be requested.
SECTION 5.7. Mergers and Sales of Assets. (a) The Borrower will not, and
will not permit any Subsidiary to, consolidate or merge with or into, or
transfer all or substantially all of its assets to, any other Person, provided
that (i) the Borrower may merge with another Person if the Borrower is the
corporation surviving such merger and immediately after giving effect to such
merger, no Default shall have occurred and be continuing, and (ii) any
Subsidiary may merge with, or transfer all or substantially all of its assets
to, any other Person if the corporation which survives the merger or is the
transferee of the assets is the Borrower or a Subsidiary and immediately after
giving effect to such merger or transfer, no Default shall have occurred and
be continuing.
(b) The Borrower will not sell, lease or otherwise transfer, directly or
indirectly, any Collateral except to the extent permitted by the Collateral
Documents.
SECTION 5.8. Use of Proceeds. The proceeds of the Loans will be used by
the Borrower for general corporate purposes. None of such proceeds will be
used, directly or indirectly, for the purpose, whether immediate, incidental
or ultimate, of buying or carrying any margin stock within the meaning of
Regulation U.
SECTION 5.9. Negative Pledge. Neither the Borrower nor any Subsidiary
will create, assume or suffer to exist any Lien on any asset now owned or
hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt outstanding
on the date of this Agreement in an aggregate principal or face amount not
exceeding $13,700,000, and Liens on Xxxx 00, Xxxxx Xxxxx Xxxxxxxxxx Xxxx XX,
Xxxxxx, Xxxxxxxx, securing debt in an aggregate principal or face amount not
at any time exceeding $18,000,000;
(b) any Lien existing on any asset of any Person at the time such Person
becomes a Subsidiary and not created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed for the purpose
of financing all or any part of the cost of acquiring such asset, including,
without limitation, Liens securing obligations under capital leases,
provided that such Lien attaches to such asset concurrently with or within
90 days after the acquisition thereof;
(d) any Lien on any asset of any Person existing at the time such Person is
merged or consolidated with or into the Borrower or a Subsidiary and not
created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition thereof by the
Borrower or a Subsidiary and not created in contemplation of such
acquisition;
(f) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the foregoing
clauses of this Section, provided that such Debt is not increased and is not
secured by any additional assets;
(g) Liens arising in the ordinary course of its business (i) which do not
secure Debt or Derivatives Obligations, (ii) which do not secure any single
obligation (or class of obligations having a common cause) in an amount
exceeding $10,000,000 and (iii) as to which no financing statement or other
document similar in effect is on file in any recording office;
(h) Liens created by the Collateral Documents; and
(i) Liens not otherwise permitted by the foregoing clauses of this Section
securing Debt in an aggregate principal or face amount not at any time
exceeding $15,000,000.
Notwithstanding the foregoing, the Borrower will not create, assume or suffer
to exist any Lien on any inventories now owned or hereafter acquired by the
Borrower (other than Liens described in clause (g) above, so long as such
Liens have not given rise to an Event of Default) or any Collateral (other
than Liens described in clause (h) above).
SECTION 5.10. Limitation on Debt. The Borrower will not, and will not
permit any of its Subsidiaries to, incur or at any time be liable with respect
to any Debt except:
(a) Debt under this Agreement;
(b) Debt outstanding on the date hereof not in excess of $77,500,000 in
aggregate principal amount and identified on Schedule I hereto;
(c) Debt secured by Liens permitted by Section 5.09; and
(d) Debt of the Borrower and its Subsidiaries not otherwise permitted by this
Section incurred after the Closing Date in an aggregate principal amount at
any time outstanding not to exceed $10,000,000.
SECTION 5.11. Minimum Consolidated Tangible Net Worth. Consolidated
Tangible Net Worth will at no time be less than an amount equal to the sum
of (i) $250,000,000 plus (ii) an amount equal to 75% of Consolidated Net
Income for each Fiscal Quarter ending after December 31, 1996 but before the
date of determination, in each case, for which Consolidated Net Income is
positive (but with no deduction on account of negative Consolidated Net Income
for any Fiscal Quarter) plus (iii) 75% of the aggregate net proceeds,
including the fair market value of property other than cash (as determined
in good faith by the Borrower's board of directors), received by the Borrower
from the issuance and sale after the date hereof of any capital stock of the
Borrower (other than the proceeds of any issuance and sale of any capital
stock (x) to a Subsidiary or (y) which is required to be redeemed, or is
redeemable at the option of the holder, if certain events or conditions occur
or exist or otherwise) or in connection with the conversion or exchange of
any Debt of the Borrower into capital stock of the Borrower after December
31, 1996.
SECTION 5.12. Debt to Consolidated Tangible Net Worth. Consolidated Debt
will not at any time exceed 60% of Consolidated Tangible Net Worth.
SECTION 5.13. Minimum Consolidated EBITDA. Consolidated EBITDA for any
four consecutive quarters will at no time be less than $100,000,000 for any
period ending prior to March 31, 1998 and $125,000,000 for any period ending
on or after March 31, 1998.
SECTION 5.14. Maximum Cash Conversion Days. Cash Conversion Days for any
Fiscal Quarter shall not exceed eighty. For purposes of this Section, Cash
Conversion Days means the sum of (i) Accounts Receivable Days and (ii)
Inventory Days, minus (iii) Accounts Payable Days; Accounts Receivable Days
means, for any period, consolidated trade receivables, less allowance for
doubtful accounts, of the Borrower and its Consolidated Subsidiaries on the
last day of such period, divided by consolidated average daily sales of the
Borrower and its Consolidated Subsidiaries during such period; Inventory Days
means, for any period, consolidated inventories of the Borrower and its
Consolidated Subsidiaries on the last day of such period divided by the
consolidated average daily cost of sales of the Borrower and its Consolidated
Subsidiaries for such period; and Accounts Payable Days means, for any
period, consolidated accounts payable of the Borrower and its Consolidated
Subsidiaries on the last day of such period divided by the consolidated
average daily cost of sales of the Borrower and its Consolidated Subsidiaries
for such period.
SECTION 5.15. Restricted Payments. Neither the Borrower nor any Subsidiary
will declare or make any Restricted Payment; provided that the Borrower may
purchase and retire shares of its capital stock so long as the aggregate
amount paid for such purchases in any Fiscal Year does not exceed the sum of
(i) the Base Amount for such Fiscal Year and (ii) the amount (if any) by
which the Base Amount for the prior Fiscal Year exceeds the amount paid for
such purchases during such prior Fiscal Year. For purposes of this Section,
Base Amount means (x) in 1997, $30,000,000, and (y) in any subsequent Fiscal
Year, 20% of consolidated net income of the Borrower and its Consolidated
Subsidiaries for the prior Fiscal Year.
SECTION 5.16. Investments. Neither the Borrower nor any Subsidiary will
hold, make or acquire any Investment in any Person other than:
(a) Investments in Persons which are Subsidiaries on the date hereof;
(b) Temporary Cash Investments; and
(c) any Investment not otherwise permitted by the foregoing clauses of this
Section if, immediately after such Investment is made or acquired, (i) no
Default shall have occurred and be continuing and (ii) the aggregate net book
value of all Investments permitted by this clause (c) does not exceed 7.5% of
Consolidated Tangible Net Worth.
SECTION 5.17. Transactions with Affiliates. The Borrower will not, and
will not permit any Subsidiary to, directly or indirectly, pay any funds to
or for the account of, make any investment (whether by acquisition of stock
or indebtedness, by loan, advance, transfer of property, guarantee or other
agreement to pay, purchase or service, directly or indirectly, any Debt, or
otherwise) in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, to, or participate in, or effect, any transaction
with, any Affiliate except on an arms-length basis on terms at least as
favorable to the Borrower or such Subsidiary as could have been obtained
from a third party that was not an Affiliate.
SECTION 5.18. Further Assurances. (a) The Borrower will at its sole
cost and expense, do, execute, acknowledge and deliver all such further acts,
deeds, conveyances, mortgages, assignments, notices of assignment and
transfers as the Administrative Agent shall from time to time request, which
may be necessary in the reasonable judgment of the Administrative Agent from
time to time to assure, perfect, convey, assign and transfer to the
Administrative Agent the property and rights conveyed or assigned pursuant
to the Collateral Documents, or which may facilitate the performance of the
terms of the Collateral Documents, or the filing, registering or recording
of the Collateral Documents.
(b) All costs and expenses in connection with the grant of any
security interests under the Collateral Documents, including without
limitation reasonable legal fees and other reasonable costs and expenses
in connection with the granting, perfecting and maintenance of any security
interests under the Collateral Documents or the preparation, execution,
delivery, recordation or filing of documents and any other acts as the
Administrative Agent may reasonably request in connection with the grant of
such security interests shall be paid by the Borrower promptly upon demand.
(c) The Borrower will not enter into or become subject to any
agreement which would impair its ability to comply, or which would purport
to prohibit it from complying, with the provisions of this Section.
ARTICLE 6
DEFAULTS
SECTION 6.1. Events of Default. If one or more of the following events
(Events of Default) shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any Loan, or
shall fail to pay within three Domestic Business Days of the due date
thereof any interest, fee or other amount payable hereunder;
(b) the Borrower shall fail to observe or perform (i) any covenant
contained in Article 5, other than those contained in Sections 5.01 through
5.06, Section 5.17 and Section 5.18, or (ii) any covenant contained in
Section 4(A) or 4(H) of the Security Agreement or Section 5(B) of the Pledge
Agreement;
(c) the Borrower shall fail to observe or perform any covenant or agreement
(other than those covered by clause (a) or (b) above) contained in the Loan
Documents for 10 days after the Administrative Agent gives notice thereof to
the Borrower at the request of any Bank;
(d) any representation, warranty, certification or statement made by the
Borrower or any Subsidiary in any Loan Document or in any certificate,
financial statement or other document delivered pursuant to any Loan Document
shall prove to have been incorrect in any material respect when made (or
deemed made);
(e) the Borrower or any Subsidiary shall fail to make one or more payments in
respect of Material Financial Obligations when due or within any applicable
grace period;
(f) any event or condition shall occur which results in the acceleration of
the maturity of any Material Debt or enables (or, with the giving of notice
or lapse of time or both, would enable) the holder of such Debt or any Person
acting on such holder's behalf to accelerate the maturity thereof;
(g) the Borrower or any Subsidiary shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect
to itself or its debts under any bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part
of its property, or shall consent to any such relief or to the appointment of
or taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced against the
Borrower or any Subsidiary seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days; or
an order for relief shall be entered against the Borrower or any Subsidiary
under the federal bankruptcy laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $5,000,000 which it shall have become liable
to pay under Title IV of ERISA; or notice of intent to terminate a Material
Plan shall be filed under Title IV of ERISA by any member of the ERISA Group,
any plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA) in respect
of, or to cause a trustee to be appointed to administer, any Material Plan;
or a condition shall exist by reason of which the PBGC would be entitled to
obtain a decree adjudicating that any Material Plan must be terminated; or
there shall occur a complete or partial withdrawal from, or a default, within
the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
Multiemployer Plans which could cause one or more members of the ERISA Group
to incur a current payment obligation in excess of $5,000,000;
(j) judgments or orders for the payment of money exceeding $5,000,000 in
aggregate amount shall be rendered against the Borrower or any Subsidiary
and such judgments or orders shall continue unsatisfied and unstayed for a
period of 20 days;
(k) any Lien created by any of the Collateral Documents shall at any time
fail to constitute a valid and (to the extent required by the Collateral
Documents) perfected Lien on all of the Collateral purported to be subject
thereto, securing the obligations purported to be secured thereby, with the
priority required by the Loan Documents, or the Borrower shall so assert in
writing; or
(l) any person or group of persons (within the meaning of Section 13 or 14
of the Exchange Act) shall have acquired beneficial ownership (within the
meaning of Rule 13d-3 promulgated by the SEC under said Act) of 30% or more
of the outstanding shares of common stock of the Borrower; or, during any
period of twelve consecutive calendar months, individuals who were directors
of the Borrower on the first day of such period (Initial Directors) or who
were nominated for election by at least 66b% of the Initial Directors shall
cease to constitute a majority of the Borrower's board of directors;
then, and in every such event, the Administrative Agent shall (i) if requested
by Banks having more than 50% in aggregate amount of the Commitments, by
notice to the Borrower terminate the Commitments and they shall thereupon
terminate, and (ii) if requested by Banks holding more than 50% of the
aggregate unpaid principal amount of the Loans, by notice to the Borrower
declare the Loans (together with accrued interest thereon) to be, and the
Loans (together with accrued interest thereon) shall thereupon become,
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower; provided
that, if any Event of Default specified in clause 6.01(g) or 6.01(h) occurs
with respect to the Borrower, then without any notice to the Borrower or any
other act by the Agents or the Banks, the Commitments shall thereupon
terminate and the Loans (together with accrued interest thereon) shall
become immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.
SECTION 6.2. Notice of Default. The Administrative Agent shall give notice
to the Borrower under Section 6.01(c) promptly upon being requested to do so
by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE 7
THE AGENTS
SECTION 7.1. Appointment and Authorization. Each Bank irrevocably appoints
and authorizes each Agent to enter into and act as its agent in connection
with the Collateral Documents and to take such action as agent on its behalf
and to exercise such powers under the Loan Documents as are delegated to
such Agent by the terms hereof or thereof, together with all such powers as
are reasonably incidental thereto.
SECTION 7.2. Agents and Affiliates. Each of Citibank, N.A. and Xxxxxx
Guaranty Trust Company of New York shall have the same rights and powers
under the Loan Documents as any other Bank and may exercise or refrain from
exercising the same as though it were not an Agent, and each of Citibank,
N.A. and Xxxxxx Guaranty Trust Company of New York and its affiliates may
accept deposits from, lend money to and generally engage in any kind of
business with the Borrower or any Subsidiary or affiliate of the Borrower
as if it were not an Agent.
SECTION 7.3. Action by Agents. The obligations of the Agents hereunder
are only those expressly set forth herein. Without limiting the generality
of the foregoing, neither Agent shall be required to take any action with
respect to any Default, except as expressly provided with respect to the
Administrative Agent in Article 6.
SECTION 7.4. Consultation with Experts. Each Agent may consult with legal
counsel (who may be counsel for the Borrower), independent public accountants
and other experts selected by it and shall not be liable for any action taken
or omitted to be taken by it in good faith in accordance with the advice of
such counsel, accountants or experts.
SECTION 7.5. Liability of Agents. Neither Agent nor any of its affiliates
or any of their respective directors, officers, agents or employees shall be
liable for any action taken or not taken by it in connection herewith (i) with
the consent or at the request of the Required Banks (or such different number
of Banks as any provision hereof expressly requires for such consent or
request) or (ii) in the absence of its own gross negligence or willful
misconduct. Neither Agent nor any of its affiliates nor any of their
respective directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with the Loan Documents or any
borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Borrower; (iii) the satisfaction of any
condition specified in Article 3, except receipt of items required to be
delivered to such Agent; or (iv) the validity, effectiveness or genuineness
of the Loan Documents or any other instrument or writing furnished in
connection herewith. Neither Agent shall incur any liability by acting
in reliance upon any notice, consent, certificate, statement or other
writing (which may be a bank wire, telex, facsimile or similar writing)
believed by it to be genuine or to be signed by the proper party or parties.
Without limiting the generality of the foregoing, the use of the term agent
in this Agreement with reference to the Agents is not intended to connote
any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used merely
as a matter of market custom and is intended to create or reflect only an
administrative relationship between independent contracting parties.
SECTION 7.6. Indemnification. The Banks shall, ratably in proportion to
their Commitments, indemnify each Agent, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by
the Borrower) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that
such indemnitees may suffer or incur in connection with the Loan Documents
or any action taken or omitted by such indemnitees thereunder.
SECTION 7.7. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance on either Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each
Bank also acknowledges that it will, independently and without reliance on
either Agent or any other Bank, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking any action under the Loan Documents.
SECTION 7.8. Successor Agents. Either Agent may resign at any time by
giving notice thereof to the Banks and the Borrower. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Agent. If no successor Agent shall have been so appointed by the Required
Banks, and shall have accepted such appointment, within 30 days after the
retiring Agent gives notice of resignation, then the retiring Agent may, on
behalf of the Banks, appoint a successor Agent, which shall be a commercial
bank organized or licensed under the laws of the United States or of any State
thereof and having a combined capital and surplus of at least $100,000,000.
Upon the acceptance of its appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with
all the rights and duties of the retiring Agent, and the retiring Agent shall
be discharged from its duties and obligations hereunder. After any retiring
Agent resigns as Agent hereunder, the provisions of this Article shall inure
to its benefit as to actions taken or omitted to be taken by it while it was
Agent.
SECTION 7.9. Agents' Fees. The Borrower shall pay to each Agent for its
own account fees in the amounts and at the times previously agreed upon by
the Borrower and such Agent.
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest Rate Inadequate or Unfair. If
on or before the first day of any Interest Period for any Euro-Dollar Loan:
(a) the Administrative Agent is advised by the Reference Banks that deposits
in dollars (in the applicable amounts) are not being offered to the Reference
Banks in the London interbank market for such Interest Period, or
(b) Banks holding 50% or more of the aggregate principal amount of the
affected Loans advise the Administrative Agent that the Adjusted London
Interbank Offered Rate as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Banks of funding their Euro-
Dollar Loans for such Interest Period,
the Administrative Agent shall forthwith give notice thereof to the Borrower
and the Banks, whereupon until the Administrative Agent notifies the Borrower
that the circumstances giving rise to such suspension no longer exist, (i) the
obligations of the Banks to make Euro-Dollar Loans or to continue or convert
outstanding Loans as or into Euro-Dollar Loans shall be suspended and (ii)
each outstanding Euro-Dollar Loan shall be converted into a Base Rate Loan on
the last day of the then current Interest Period applicable thereto. Unless
the Borrower notifies the Administrative Agent at least two Domestic Business
Days before the date of any affected Borrowing for which a Notice of Borrowing
has previously been given that it elects not to borrow on such date, such
Borrowing shall instead be made as a Base Rate Borrowing.
SECTION 8.2. Illegality. If, on or after the date hereof, the adoption of
any applicable law, rule or regulation, or any change in any applicable law,
rule or regulation, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by
any Bank (or its Euro-Dollar 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 for any Bank (or
its Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar
Loans and such Bank shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Banks
and the Borrower, whereupon until such Bank notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Bank to make Euro-Dollar Loans, or to
convert outstanding Loans into Euro-Dollar Loans or continue outstanding Loans
as Euro-Dollar Loans, shall be suspended. Before giving any notice to the
Administrative Agent pursuant to this Section, such Bank shall designate a
different Euro-Dollar Lending Office if such designation will avoid the need
for giving such notice and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. If such notice is given, each Euro-
Dollar Loan of such Bank then outstanding shall be converted to a Base Rate
Loan either (a) on the last day of the then current Interest Period
applicable to such Euro-Dollar Loan if such Bank may lawfully continue to
maintain and fund such Loan as a Euro-Dollar Loan to such day or (b)
immediately if such Bank shall determine that it may not lawfully continue
to maintain and fund such Loan as a Euro-Dollar Loan to such day.
SECTION 8.3. Increased Cost and Reduced Return. (a) If on or after the
date hereof, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable 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 impose,
modify or deem applicable any reserve (including, without limitation, any
such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding any such requirement included in an applicable Euro-
Dollar Reserve Percentage), special deposit, insurance assessment or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Applicable Lending Office) or shall impose on
any Bank (or its Applicable Lending Office) or the London interbank market
any other condition affecting its Euro-Dollar Loans, its Note or its
obligation to make Euro-Dollar Loans and the result of any of the foregoing
is to increase the cost to such Bank (or its Applicable Lending Office) of
making or maintaining any Euro-Dollar Loan, or to reduce the amount of any
sum received or receivable by such Bank (or its Applicable Lending Office)
under this Agreement or under its Note with respect thereto, by an amount
deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Administrative Agent), the Borrower shall pay
to such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any such law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing
the rate of return on capital of such Bank (or its Parent) as a consequence
of such Bank's obligations hereunder to a level below that which such Bank
(or its Parent) could have achieved but for such adoption, change, request or
directive (taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, then from time
to time, within 15 days after demand by such Bank (with a copy to the
Administrative Agent), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank (or its Parent) for such
reduction.
(c) Each Bank will promptly notify the Borrower and the Administrative
Agent of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Bank to compensation pursuant to this
Section and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. A certificate of any Bank claiming
compensation under this Section and setting forth the additional amount
or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, such Bank may use any
reasonable averaging and attribution methods.
SECTION 8.4. Taxes. (a) For the purposes of this Section, the following
terms have the following meanings:
Taxes means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings with respect to any payment by the
Borrower pursuant to this Agreement or under any Note, and all liabilities
with respect thereto, excluding (i) in the case of each Bank and Agent,
taxes imposed on its net income, and franchise or similar taxes imposed on
it, by a jurisdiction under the laws of which such Bank or Agent (as the case
may be) is organized or in which its principal executive office is located
or, in the case of each Bank, in which its Applicable Lending Office is
located and (ii) in the case of each Bank, any United States withholding tax
imposed on such payment, but not any portion of such tax that exceeds the
United States withholding tax which would have been imposed on such a payment
to such Bank under the laws and treaties in effect when such Bank first
became a party to this Agreement.
Other Taxes means any present or future stamp or documentary taxes and any
other excise or property taxes, or similar charges or levies, which arise from
any payment made pursuant to this Agreement or under any Note or from the
execution, delivery, registration or enforcement of, or otherwise with respect
to, any Loan Document.
(b) All payments by the Borrower to or for the account of any Bank or Agent
hereunder or under any Note shall be made without deduction for any Taxes or
Other Taxes; provided that, if the Borrower shall be required by law to deduct
any Taxes or Other Taxes from any such payment, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section) such Bank
or Agent (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions, (iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable
law and (iv) the Borrower shall promptly furnish to the Administrative Agent,
at its address specified in or pursuant to Section 9.01, the original or a
certified copy of a receipt evidencing payment thereof.
(c) The Borrower agrees to indemnify each Bank and Agent for the full amount
of Taxes and Other Taxes (including, without limitation, any Taxes or Other
Taxes imposed or asserted (whether or not correctly) by any jurisdiction on
amounts payable under this Section) paid by such Bank or Agent (as the case
may be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be paid within
15 days after such Bank or Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the United
States, before it signs and delivers this Agreement in the case of each Bank
listed on the signature pages hereof and before it becomes a Bank in the case
of each other Bank, and from time to time thereafter if requested in writing
by the Borrower (but only so long as such Bank remains lawfully able to do
so), shall provide each of the Borrower and the Administrative Agent with
Internal Revenue Service form 1001 or 4224, as appropriate, or any successor
form prescribed by the Internal Revenue Service, certifying that such Bank is
entitled to benefits under an income tax treaty to which the United States is
a party which exempts the Bank from United States withholding tax or reduces
the rate of withholding tax on payments of interest for the account of such
Bank or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States.
(e) For any period with respect to which a Bank has failed to provide the
Borrower or the Administrative Agent with the appropriate form referred to
in Section 8.04(d) (unless such failure is due to a change in treaty, law or
regulation occurring after the date on which such form originally was required
to be provided), such Bank shall not be entitled to indemnification under
Section 8.04(b) or (c) with respect to Taxes imposed by the United States;
provided that if a Bank, that is otherwise exempt from or subject to a reduced
rate of withholding tax, becomes subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall take such steps as such
Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to or for the
account of any Bank pursuant to this Section as a result of a change in law
or treaty occurring after such Bank first became a party to this Agreement,
then such Bank will, at the Borrower's request, change the jurisdiction of
its Applicable Lending Office if, in the judgment of such Bank, such change
(i) will eliminate or reduce any such additional payment which may thereafter
accrue and (ii) is not otherwise disadvantageous to such Bank.
SECTION 8.5. Base Rate Loans Substituted for Affected Euro-Dollar Loans.
If (i) the obligation of any Bank to make, or to continue or convert
outstanding Loans as or to, Euro-Dollar Loans has been suspended pursuant to
Section 8.02 or (ii) any Bank has demanded compensation under Section 8.03 or
8.04 with respect to its Euro-Dollar Loans, and in any such case the Borrower
shall, by at least five Euro-Dollar Business Days' prior notice to such Bank
through the Administrative Agent, have elected that the provisions of this
Section shall apply to such Bank, then, unless and until such Bank notifies
the Borrower that the circumstances giving rise to such suspension or demand
for compensation no longer exist, all Loans which would otherwise be made by
such Bank as (or continued as or converted to) Euro-Dollar Loans shall instead
be Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks).
If such Bank notifies the Borrower that the circumstances giving rise to
such suspension or demand for compensation no longer exist, the principal
amount of each such Base Rate Loan shall be converted into a Euro-Dollar Loan
on the first day of the next succeeding Interest Period applicable to the
related Euro-Dollar Loans of the other Banks.
SECTION 8.6. Substitution of Bank. If (i) the obligation of any Bank to
make Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii)
any Bank has demanded compensation under Section 8.03 or 8.04, the Borrower
shall have the right, with the assistance of the Agents, to require such Bank
to transfer, pursuant to an Assignment and Assumption Agreement substantially
in the form of Exhibit D hereto, its Note and Commitment to a substitute bank
or banks (which may be one or more of the Banks) satisfactory to the Borrower
and the Agents.
ARTICLE 9
MISCELLANEOUS
SECTION 9.1. Notices. Communications to any party hereunder shall be in
writing (including bank wire, telex, facsimile or similar writing) and shall
be given to such party: (a) in the case of the Borrower or either Agent, at
its address, facsimile number or telex number set forth on the signature pages
hereof, (b) in the case of any Bank, at its address, facsimile number or
telex number set forth in its Administrative Questionnaire or (c) in the case
of any party, at such other address, facsimile number or telex number as such
party may hereafter specify for the purpose by notice to the Agents and the
Borrower. Each such notice, request or other communication shall be effective
(i) if given by telex, when transmitted to the telex number referred to in
this Section and the appropriate answerback is received, (ii) if given by
facsimile, when transmitted to the facsimile number referred to in this
Section and confirmation of receipt is received, (iii) if given by mail, 72
hours after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (iv) if given by any other means,
when delivered at the address referred to in this Section; provided that
notices to the Administrative Agent under Article 2 or Article 8 shall not
be effective until received.
SECTION 9.2. No Waivers. No failure or delay by either Agent or any Bank
in exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.3. Expenses; Indemnification. (a) The Borrower shall pay (i)
all reasonable out-of-pocket expenses of the Agents, including fees and
disbursements of special counsel for the Agents, in connection with the
preparation and administration of the Loan Documents, any waiver or consent
thereunder or any amendment thereof or any Default or alleged Default
thereunder and (ii) if an Event of Default occurs, all out-of-pocket expenses
incurred by either Agent and each Bank, including (without duplication) the
fees and disbursements of outside counsel and the allocated cost of inside
counsel, in connection with such Event of Default and collection, bankruptcy,
insolvency and other enforcement proceedings resulting therefrom.
(b) The Borrower agrees to indemnify each Agent and Bank, their respective
affiliates (including, without limitation, the Security Agent and the
Concentration Bank (as defined in the Security Agreement)) and the respective
directors, officers, agents and employees of the foregoing (each an
Indemnitee) and hold each Indemnitee harmless from and against any and all
liabilities, losses, damages, costs and expenses of any kind, including,
without limitation, the reasonable fees and disbursements of counsel
(including the allocated cost of in-house counsel), which may be incurred by
such Indemnitee in connection with any investigative, administrative or
judicial proceeding (whether or not such Indemnitee shall be designated a
party thereto) brought or threatened relating to or arising out of the Loan
Documents or any actual or proposed use of proceeds of Loans hereunder;
provided that no Indemnitee shall have the right to be indemnified hereunder
for such Indemnitee's own gross negligence or willful misconduct as
determined by a court of competent jurisdiction.
SECTION 9.4. Sharing of Set-offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment
of a proportion of the aggregate amount of principal and interest then due
with respect to the Loans held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of principal
and interest then due with respect to the Loans held by such other Bank, the
Bank receiving such proportionately greater payment shall purchase such
participation in the Loans held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Loans held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right
of any Bank to exercise any right of set-off or counterclaim it may have and
to apply the amount subject to such exercise to the payment of indebtedness
of the Borrower other than its indebtedness hereunder. The Borrower agrees,
to the fullest extent it may effectively do so under applicable law, that any
holder of a participation in a Loan, whether or not acquired pursuant to the
foregoing arrangements, may exercise rights of set-off or counterclaim and
other rights with respect to such participation as fully as if such holder of
a participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.5. Amendments and Waivers; Release of Collateral. Any provision
of this Agreement or the Notes may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Borrower and the
Required Banks (and, if the rights or duties of either Agent are affected
thereby, by such Agent); provided that no such amendment or waiver shall,
unless signed by all the Banks, (i) increase or decrease the Commitment of
any Bank (except for a ratable decrease in the Commitments of all Banks) or
subject any Bank to any additional obligation, (ii) reduce the principal of
or rate of interest on any Loan or any fees hereunder, (iii) postpone the
date fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for the termination of any Commitment or (iv) change the
percentage of the Commitments or of the aggregate unpaid principal amount of
the Loans, or the number of Banks, which shall be required for the Banks or
any of them to take any action under this Section or any other provision of
this Agreement. Any provision of the Collateral Documents may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed
by the Borrower and the Administrative Agent with the consent of the Required
Banks; provided that no such amendment or waiver shall, unless signed by all
the Banks, effect or permit a release of all or substantially all of the
Collateral. Notwithstanding the foregoing, Collateral shall be released from
the Lien of the Collateral Documents from time to time as necessary to effect
any sale or pledge of assets permitted by the Loan Documents, and the Agent
shall execute and deliver all release documents reasonably requested to
evidence such release.
SECTION 9.6. Successors; Participation and Assignments. (a) The provisions
of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns, except that the
Borrower may not assign or otherwise transfer any of its rights under this
Agreement without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other institutions
(each a Participant) participating interests in its Commitment or any or
all of its Loans. If a Bank grants any such participating interest to a
Participant, whether or not upon notice to the Borrower and the Agents, such
Bank shall remain responsible for the performance of its obligations
hereunder, and the Borrower and the Agents shall continue to deal solely and
directly with such Bank in connection with such Bank's rights and obligations
under this Agreement. Any agreement pursuant to which any Bank may grant
such a participating interest shall provide that such Bank shall retain the
sole right and responsibility to enforce the Borrower's obligations hereunder,
including (without limitation) the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
participation agreement may provide that such Bank will not agree to any
modification, amendment or waiver of this Agreement described in clause (i),
(ii) or (iii) of, or in the proviso in the penultimate sentence of, Section
9.05 without the consent of the Participant. The Borrower agrees that each
Participant shall, to the extent provided in its participation agreement, be
entitled to the benefits of Article 8 with respect to its participating
interest. An assignment or other transfer which is not permitted by
subsection (c) or (d) below shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in
accordance with this subsection.
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an Assignee) all, or a proportionate part (equivalent
to an initial Commitment of not less than $10,000,000) of all, of its rights
and obligations under this Agreement and its Note, and such Assignee shall
assume such rights and obligations, pursuant to an Assignment and Assumption
Agreement substantially in the form of Exhibit D hereto signed by such
Assignee and such transferor Bank, with (and subject to) the subscribed
consent of the Borrower, which shall not be unreasonably withheld, and the
Agents; provided that if an Assignee is an affiliate of such transferor
Bank or was a Bank immediately before such assignment, no such consent
shall be required. When such instrument has been signed and delivered by
the parties thereto and such Assignee has paid to such transferor Bank the
purchase price agreed between them, such Assignee shall be a Bank party to
this Agreement and shall have all the rights and obligations of a Bank with
a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall
be required. Upon the consummation of any assignment pursuant to this
subsection, the transferor Bank, the Administrative Agent and the Borrower
shall make appropriate arrangements so that, if required, a new Note is
issued to the Assignee. In connection with any such assignment, the
transferor Bank shall pay to the Administrative Agent an administrative fee
for processing such assignment in the amount of $3,000. If the Assignee
is not incorporated under the laws of the United States or a State thereof,
it shall deliver to the Borrower and the Administrative Agent certification
as to exemption from deduction or withholding of any United States federal
income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its rights under
this Agreement and its Note to a Federal Reserve Bank. No such assignment
shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights shall
be entitled to receive any greater payment under Section 8.03 or 8.04 than
such Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by reason of the provisions of Section 8.02, 8.03 or 8.04
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances or at a time when the circumstances giving rise to
such greater payment did not exist.
SECTION 9.7. No Reliance on Margin Stock. Each of the Banks represents to
the Agents and each of the other Banks that it in good faith is not relying
upon any margin stock (as defined in Regulation U) as collateral in the
extension or maintenance of the credit provided for in this Agreement.
SECTION 9.8. Governing Law; Submission to Jurisdiction. This Agreement
and each Note shall be governed by and construed in accordance with the laws
of the State of New York. The Borrower hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State court sitting in New York City for purposes
of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. The Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a
court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
SECTION 9.9. Counterparts; Integration; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof. This Agreement shall become effective when the Documentation Agent
has received from each of the parties hereto a counterpart hereof signed by
such party or facsimile or other written confirmation satisfactory to the
Documentation Agent confirming that such party has signed a counterpart
hereof.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENTS AND
THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.11. Confidentiality. Each Agent and Bank agrees to keep any
information delivered or made available by the Borrower pursuant to this
Agreement confidential from anyone other than persons employed or retained
by such Bank who are engaged in evaluating, approving, structuring or
administering the credit facility contemplated hereby; provided that nothing
herein shall prevent either Agent or any Bank from disclosing such
information (a) to any other Bank or to either Agent, (b) to any other
Person if reasonably incidental to the administration of the credit facility
contemplated hereby, (c) upon the order of any court or administrative
agency, (d) upon the request or demand of any regulatory agency or
authority, (e) which had been publicly disclosed other than as a result of
a disclosure by either Agent or any Bank prohibited by this Agreement, (f)
in connection with any litigation to which either Agent, any Bank or its
subsidiaries or Parent may be a party, (g) to the extent necessary in
connection with the exercise of any remedy hereunder, (h) to such Bank's or
Agent's legal counsel and independent auditors and (i) subject to provisions
substantially similar to those contained in this Section, to any actual or
proposed Participant or Assignee; provided, further, that for purposes of
this Section, information does not mean any information which (x) was
already in the possession of such Bank or Agent at the time of its disclosure
by the Borrower or (y) is made available to such Bank or Agent by a third
party which, to the knowledge of such Bank or Agent, did not violate any
confidentiality obligation by doing so.
SECTION 9.12. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, each Bank is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to
set-off and otherwise apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Bank to or for the credit or the account of the
Borrower against any and all of the obligations of the Borrower now or
hereafter existing under this Agreement and the Note held by such Bank,
whether or not such Bank shall have made any demand under this Agreement
or the Note held by such Bank and although such obligations may be
unmatured. Such Bank agrees promptly to notify the Borrower after any such
set-off and application, provided that the failure to give such notice
shall not affect the validity of such set-off and application. The rights
of each Bank under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which
such Bank may have.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and
year first above written.
IOMEGA CORPORATION
By /S/ XXXXXX X. XXXXXXX
Name: XXXXXX X. XXXXXXX
Title: TREASURER
Address: 0000 Xxxx Xxxxxx Xxx
Xxx, Xxxx 00000
Attention: Treasurer and General
Counsel
Facsimile: (000) 000-0000
BANKS
CITIBANK, N.A.
By /S/ XXXXXXX X. XXX
Name: XXXXXXX X. XXX
Title: ATTORNEY-IN-FACT
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK
By /S/ XXXX X. SILVER
Name: XXXX X. SILVER
Title: ASSOCIATE
FLEET NATIONAL BANK
By /S/ XXXXX XXXXXX
Name: XXXXX XXXXXX
Title: VICE PRESIDENT
XXXXX FARGO BANK, N.A.
By /S/ XXXXXX XXXXXX
Name: XXXXXX XXXXXX
Title: VICE PRESIDENT
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By /S/ XXXXX XXXXXXX
Name: XXXXX XXXXXXX
Title: MANAGING DIRECTOR
CIBC, INC.
By /S/XXX X XXXXX
Name: XXX X XXXXX
Title: AUTHORIZED SIGNATORY
FIRST SECURITY BANK OF UTAH, N.A.
By /S/ XXXX X. XXXXX
Name: XXXX X. XXXXX
Title: VICE PRESIDENT
KEY BANK OF WASHINGTON
By /S/ X.X. XXXXXX
Name: X.X. XXXXXX
Title: ASSISTANT VICE PRESIDENT
ABN AMRO BANK N.V.
By /S/ XXXXXX X. XXXXXX
Name: XXXXXX X. XXXXXX
Title: GROUP VICE PRESIDENT
CREDIT LYONNAIS LOS ANGELES
BRANCH
By /S/ XXXXXXX XXXXXXX
Name: XXXXXXX XXXXXXX
Title: VICE PRESIDENT
NATIONAL BANK OF CANADA
By /S/ XXXXXXX X. XXXXXXXXXX
Name: XXXXXXX X. XXXXXXXXXX
Title: VICE PRESIDENT
THE SUMITOMO TRUST & BANKING
CO., LTD., LOS ANGELES AGENCY
By /S/ XXXXXX X. XXXXXXXX
Name: XXXXXX X. XXXXXXXX
Title: VICE PRESIDENT & MANAGER
CREDITO ITALIANO, NEW YORK BRANCH
By /S/ XXXXXXXXX XXXXXXXX
Name: XXXXXXXXX XXXXXXXX
Title: ASST. VICE PRESIDENT
THE NORTHERN TRUST COMPANY
By /S/ XXXX X. XXXXX
Name: XXXX X. XXXXX
Title: SECOND VICE PRESIDENT
ISTITUTO BANCARIO SAN PAOLO DI
TORINO S.P.A
By /S/ ILLEGIBLE
Name: ILLEGIBLE
Title: FVP
By /S/ ILLEGIBLE
Name: ILLEGIBLE
Title: V.P.
THE SANWA BANK, LIMITED, LOS
ANGELES BRANCH
By /S/ XXXX X. XXXXXX
Name: XXXX X. XXXXXX
Title: VICE PRESIDENT
UNION BANK OF CALIFORNIA, N.A.
By /S/ XXXX XXXXXXXXX
Name: XXXX XXXXXXXXX
Title: VICE PRESIDENT
CITIBANK, N.A., as Administrative Agent
By /S/ XXXXXXX X. XXX
Name: XXXXXXX X. XXX
Title: ATTORNEY-IN-FACT
Address: 000 XXXX XXXXXX, XX, XX 00000
Facsimile: (000) 000-0000
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, as
Documentation Agent
By /S/ XXXX X. SILVER
Name: XXXX X. SILVER
Title: ASSOCIATE
Address: 00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile:
COMMITMENT SCHEDULE
Bank Commitment
Citibank, N.A. $20,000,000
Xxxxxx Guaranty Trust Company of New York 20,000,000
Fleet National Bank 15,000,000
Xxxxx Fargo Bank, N.A. 15,000,000
Bank of America National Trust and Savings
Association 12,500,000
CIBC, Inc. 12,500,000
First Security Bank of Utah, N.A. 12,500,000
Key Bank of Washington 12,500,000
ABN AMRO Bank N.V. 10,000,000
Credit Lyonnais Los Angeles Branch 10,000,000
National Bank of Canada 10,000,000
The Sumitomo Trust & Banking Co., Ltd.
Los Angeles Agency 10,000,000
Credito Italiano, New York Branch 8,000,000
The Northern Trust Company 8,000,000
Istituto Bancario San Paolo Di Torino S.P.A. 8,000,000
The Sanwa Bank, Limited, Los Angeles Branch 8,000,000
Union Bank of California, N.A. 8,000.000
Total $200,000,000
PRICING SCHEDULE
Each of Euro-Dollar Margin, Base Rate Margin and Commitment Fee Rate means,
for any date, the percentage as set forth below in the row opposite such
term and in the column corresponding to the Pricing Level that applies
at such date:
Xxxxx Xxxxx Xxxxx Xxxxx
X II III IV
Euro-Dollar
Margin 1.0% 1.25% 1.50% 2.0%
Base Rate
Margin 0% 0% 0% .50%
Commitment Fee Rate .375% .375% .375% .50%
For purposes of this Schedule, the following terms have the following
meanings:
Level I Pricing applies at any date if, as of such date, the Leverage Ratio
is less than .15 to 1.
Level II Pricing applies at any date if, as of such date, (i) the Leverage
Ratio is less than or equal to .35 to 1 and (ii) Level I Pricing does not
apply.
Level III Pricing applies at any date if, as of such date, (i) the Leverage
Ratio is less than or equal to .5 to 1 and (ii) neither Level I Pricing nor
Level II Pricing applies.
Level IV Pricing applies at any date if, as of such date, no other Pricing
Level applies.
Leverage Ratio means as of any date the ratio of Consolidated Debt to
Consolidated Tangible Net Worth set forth in the most recent certificate
delivered pursuant to Section 5.01(c); provided that unless the Required
Banks otherwise agree, if the Borrower has failed to deliver the financial
statements and accompanying certificates most recently required to have been
delivered within the time periods specified therefor in Section 5.01, Level
IV Pricing shall apply until the next date on which financial statements
and accompanying certificates are timely delivered.
Pricing Level refers to the determination of which of Level I, Level II,
Level III or Level IV applies at any date.
EXHIBIT A
Note
New York, New York
___________ __, 199_
For value received, Iomega Corporation, a Delaware corporation (the Borrower),
promises to pay to the order of ______________________ (the Bank), for the
account of its Applicable Lending Office, the unpaid principal amount of each
Loan made by the Bank to the Borrower pursuant to the Credit Agreement
referred to below on the maturity date provided for in the Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount of each
such Loan on the dates and at the rate or rates provided for in the Credit
Agreement. All such payments of principal and interest shall be made in
lawful money of the United States in Federal or other immediately available
funds at the office of Citibank, N.A., _________________, New York, New York.
All Loans made by the Bank, the respective types thereof and all repayments
of the principal thereof shall be recorded by the Bank and, if the Bank so
elects in connection with any transfer or enforcement hereof, appropriate
notations to evidence the foregoing information with respect to each such
Loan then outstanding may be endorsed by the Bank on the schedule attached
hereto, or on a continuation of such schedule attached to and made a part
hereof; provided that the failure of the Bank to make any such recordation
or endorsement shall not affect the Borrower's obligations hereunder or
under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement dated as of
March 11, 1997 among Iomega Corporation, the Banks party thereto, Citibank,
N.A., as Administrative Agent, and Xxxxxx Guaranty Trust Company of New York,
as Documentation Agent (as the same may be amended from time to time, the
Credit Agreement). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit Agreement for
provisions for the prepayment hereof and the acceleration of the maturity
hereof.
IOMEGA CORPORATION
By____________________
Name:
Title:
Loans and Payments of Principal
Date Amount of Type of Amount of Notation Made
Loan Loan Principal By
Repaid
EXHIBIT B
Opinion of
Counsel for the Borrower
EXHIBIT C
Opinion of
Xxxxx Xxxx & Xxxxxxxx, Special Counsel
for the Agents
________________, 199__
To the Banks and the Agents
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Documentation Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We have participated in the preparation of the Credit Agreement dated as of
March 11, 1997 (the Credit Agreement) among Iomega Corporation, a Delaware
corporation (the Borrower), the Banks party thereto, Citibank, N.A., as
Administrative Agent, and Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, and have acted as special counsel for the Agents for
the purpose of rendering this opinion pursuant to Section 3.01(c) of the
Credit Agreement. Terms defined in the Credit Agreement are used herein
as therein defined.
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of the Credit
Agreement and the Notes are within the Borrower's corporate powers and have
been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding agreement of the
Borrower and each Note issued thereunder today constitutes a valid and binding
obligation of the Borrower, in each case enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency or similar laws affecting
creditors' rights generally and general principles of equity.
We are members of the Bar of the State of New York and the foregoing opinion
is limited to the laws of the State of New York, the federal laws of the
United States of America and the General Corporation Law of the State of
Delaware. In giving the foregoing opinion, we express no opinion as to the
effect (if any) of any law of any jurisdiction (except the State of New York)
in which any Bank is located which limits the rate of interest that such Bank
may charge or collect.
This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other purpose or relied
upon by any other Person without our prior written consent.
Very truly yours,
EXHIBIT D
Assignment and Assumption Agreement
AGREEMENT dated as of _________, 19__ among (the Assignor),
(the Assignee)[, IOMEGA CORPORATION (the Borrower),
CITIBANK, N.A., as Administrative Agent, and XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as Documentation Agent (collectively, the Agents).]
WHEREAS, this Assignment and Assumption Agreement (the Agreement) relates to
the Credit Agreement dated as of March 11, 1997 among the Borrower, the
Assignor and the other Banks party thereto and the Agent (as amended from
time to time, the Credit Agreement);
WHEREAS, as provided under the Credit Agreement, the Assignor has a Commitment
to make Loans to the Borrower in an aggregate principal amount at any time
outstanding not to exceed $____________;
WHEREAS, Loans made to the Borrower by the Assignor under the Credit Agreement
in the aggregate principal amount of $__________ are outstanding at the date
hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the rights of
the Assignor under the Credit Agreement in respect of a portion of its
Commitment thereunder in an amount equal to $__________ (the Assigned Amount),
together with a corresponding portion of each of its outstanding Loans, and
the Assignee proposes to accept assignment of such rights and assume the
corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise defined herein
have the respective meanings set forth in the Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the Assignee
all of the rights of the Assignor under the Credit Agreement to the extent of
the Assigned Amount, and the Assignee hereby accepts such assignment from the
Assignor and assumes all of the obligations of the Assignor under the Credit
Agreement to the extent of the Assigned Amount, including the purchase from
the Assignor of the corresponding portion of the principal amount of each of
the Loans made by the Assignor outstanding at the date hereof. Upon the
execution and delivery hereof by the Assignor, the Assignee, [the Borrower
and the Agent] and the payment of the amounts specified in Section 3
required to be paid on the date hereof (i) the Assignee shall, as of the date
hereof, succeed to the rights and be obligated to perform the obligations of
a Bank under the Credit Agreement with a Commitment in an amount equal to
the Assigned Amount, and (ii) the Commitment of the Assignor shall, as of
the date hereof, be reduced by a like amount and the Assignor released from
its obligations under the Credit Agreement to the extent such obligations
have been assumed by the Assignee. The assignment provided for herein shall
be without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on
the date hereof in Federal funds the amount heretofore agreed between them.*
Commitment and/or facility fees accrued before the date hereof are for the
account of the Assignor and such fees accruing on and after the date hereof
with respect to the Assigned Amount are for the account of the Assignee.
Each of the Assignor and the Assignee agrees that if it receives any amount
under the Credit Agreement which is for the account of the other party hereto,
it shall receive the same for the account of such other party to the extent
of such other party's interest therein and promptly pay the same to such other
party.
[SECTION 4. Consent of the Borrower and the Agents. This Agreement is
conditioned upon the consent of the Borrower and the Agents pursuant to
Section 9.06(c) of the Credit Agreement. The execution of this Agreement by
the Borrower and the Agents is evidence of their consent. Pursuant to
Section 9.06(c), the Borrower agrees to execute and deliver a Note payable
to the order of the Assignee to evidence the assignment and assumption
provided for herein.]
SECTION 5. Non-Reliance on Assignor. The Assignor makes no representation or
warranty in connection with, and shall have no responsibility with respect to,
the solvency, financial condition or statements of the Borrower, or the
validity and enforceability of the Borrower's obligations under the Credit
Agreement or any Note. The Assignee acknowledges that it has, independently
and without reliance on the Assignor, and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and will continue to be responsible for
making its own independent appraisal of the business, affairs and financial
condition of the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
By
Name:
Title:
By
Name:
Title:
[IOMEGA CORPORATION
By
Name:
Title:]
[CITIBANK, N.A., as Administrative Agent
By
Name:
Title:]
[XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK,
as Documentation Agent
By
Name:
Title:]
* Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula
rather than as a fixed sum. If this Agreement is prepared in connection with
a substitution pursuant to Section 8.06 of the Credit Agreement, amount must
combine principal, accrued interest and fees and breakage compensation, if
any, and the administrative fee referred to in Section 9.06(c) of the Credit
Agreement must be paid to the Administrative Agent.
