[EXECUTION COPY]
CREDIT AGREEMENT
Dated as of August 25, 1997
among
DELTA XXXXX, INC.,
as Borrower,
CERTAIN SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTY HERETO,
as Guarantors,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTY HERETO,
NATIONSBANK, N.A.,
as Administrative Agent,
AND
BNY FINANCIAL CORPORATION,
as Collateral Agent
TABLE OF CONTENTS
SECTION 1 DEFINITIONS 1
1.1 Definitions. 1
1.2 Computation of Time Periods. 26
1.3 Accounting Terms. 26
SECTION 2 CREDIT FACILITIES 27
2.1 Revolving Loans. 27
2.2 Letter of Credit Subfacility. 29
2.3 Swingline Loan Subfacility. 34
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES 36
3.1 Default Rate. 36
3.2 Extension and Conversion. 37
3.3 Prepayments. 37
3.4 Termination and Reduction of Revolving Committed Amount.
39
3.5 Fees. 39
3.6 Capital Adequacy. 41
3.7 Limitation on Eurodollar Loans. 41
3.8 Illegality. 41
3.9 Requirements of Law. 42
3.10 Treatment of Affected Loans. 43
3.11 Taxes. 44
3.12 Compensation. 46
3.13 Pro Rata Treatment. 46
3.14 Sharing of Payments. 47
3.15 Payments, Computations, Etc. 48
3.16 Evidence of Debt. 50
3.17 Mandatory Assignment. 50
SECTION 4 GUARANTY 51
4.1 The Guaranty. 51
4.2 Obligations Unconditional. 51
4.3 Reinstatement. 53
4.4 Certain Additional Waivers. 53
4.5 Remedies. 53
4.6 Rights of Contribution. 53
4.7 Continuing Guarantee. 54
SECTION 5 CONDITIONS 55
5.1 Closing Conditions. 55
5.2 Conditions to all Extensions of Credit. 59
SECTION 6 REPRESENTATIONS AND WARRANTIES 60
6.1 Financial Condition. 60
6.2 No Material Change. 60
6.3 Organization and Good Standing. 61
6.4 Power; Authorization; Enforceable Obligations. 61
6.5 No Conflicts. 61
6.6 No Default. 62
6.7 Ownership. 62
6.8 Indebtedness. 62
6.9 Litigation. 62
6.10 Taxes. 62
6.11 Compliance with Law. 62
6.12 ERISA. 63
6.13 Subsidiaries. 64
6.14 Governmental Regulations, Etc. 64
6.15 Purpose of Loans and Letters of Credit. 65
6.16 Environmental Matters. 65
6.17 Intellectual Property. 67
6.18 Solvency. 67
6.19 Investments. 67
6.20 Location of Collateral. 67
6.21 Disclosure. 67
6.22 No Burdensome Restrictions. 67
6.23 Brokers' Fees. 68
6.24 Labor Matters. 68
6.25 Nature of Business. 68
SECTION 7 AFFIRMATIVE COVENANTS 68
7.1 Information Covenants. 68
7.2 Preservation of Existence and Franchises. 72
7.3 Books and Records. 72
7.4 Compliance with Law. 72
7.5 Payment of Taxes and Other Indebtedness. 72
7.6 Insurance. 73
7.7 Maintenance of Property. 73
7.8 Performance of Obligations. 73
7.9 Use of Proceeds. 73
7.10 Audits/Inspections. 73
7.11 Financial Covenants. 74
7.12 Additional Credit Parties. 75
7.13 Pledged Assets; Release of Collateral. 76
7.14 Factoring Agreements. 76
SECTION 8 NEGATIVE COVENANTS 77
8.1 Indebtedness. 77
8.2 Liens. 78
8.3 Nature of Business. 78
8.4 Consolidation, Merger, Dissolution, etc. 78
8.5 Asset Dispositions. 79
8.6 Investments. 79
8.7 Restricted Payments. 79
8.8 Prepayments of Indebtedness, etc. 80
8.9 Transactions with Affiliates. 81
8.10 Fiscal Year. 81
8.11 Limitation on Restricted Actions. 81
8.12 Ownership of Subsidiaries. 82
8.13 Sale Leasebacks. 82
8.14 Capital Expenditures. 82
8.15 No Further Negative Pledges. 82
8.16 Operating Lease Obligations. 83
8.17 Limitation on Foreign Operations. 83
8.18 Factoring Agreements. 83
SECTION 9 EVENTS OF DEFAULT 83
9.1 Events of Default. 83
9.2 Acceleration; Remedies. 86
SECTION 10 AGENCY PROVISIONS 87
10.1 Appointment, Powers and Immunities. 87
10.2 Reliance by Administrative Agent and the Collateral
Agent. 88
10.3 Defaults. 88
10.4 Rights as a Lender. 88
10.5 Indemnification. 89
10.6 Non-Reliance on Administrative Agent, Collateral Agent
and Other Lenders. 89
10.7 Successor Administrative Agent. 90
SECTION 11 MISCELLANEOUS 90
11.1 Notices. 90
11.2 Right of Set-Off; Adjustments. 92
11.3 Benefit of Agreement. 92
11.4 No Waiver; Remedies Cumulative. 94
11.5 Expenses; Indemnification. 94
11.6 Amendments, Waivers and Consents. 95
11.7 Counterparts. 97
11.8 Headings. 97
11.9 Survival. 97
11.10 Governing Law; Submission to Jurisdiction; Venue. 97
11.11 Severability. 98
11.12 Entirety. 98
11.13 Binding Effect; Termination. 98
11.14 Confidentiality. 99
11.15 Conflict. 99
SCHEDULES
Schedules Omitted
EXHIBITS
Exhibit 1.1A Form of Pledge Agreement
Exhibit 1.1B Form of Security Agreement
Exhibit 2.1(b)(i) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Revolving Note
Exhibit 2.3(d) Form of Swingline Note
Exhibit 3.2 Form of Notice of Extension/Conversion
Exhibit 7.1(c) Form of Officer's Compliance Certificate
Exhibit 7.1(d) Form of Borrowing Base Certificate
Exhibit 7.12 Form of Joinder Agreement
Exhibit 11.3(b) Form of Assignment and Acceptance
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of August 25, 1997 (as
amended, modified, restated or supplemented from time to time,
the "Credit Agreement"), is by and among DELTA XXXXX, INC., a
Delaware corporation (the "Borrower"), the Guarantors (as defined
herein), the Lenders (as defined herein), NATIONSBANK, N.A., as
Administrative Agent for the Lenders (in such capacity, the
"Administrative Agent") and BNY FINANCIAL CORPORATION, as
Collateral Agent for the Lenders (in such capacity, the
"Collateral Agent").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide
a $100 million credit facility for the purposes hereinafter set
forth; and
WHEREAS, the Lenders have agreed to make the requested
credit facility available to the Borrower on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other
good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as
follows:
SECTION 1
DEFINITIONS
1.1 Definitions.
As used in this Credit Agreement, the following terms shall
have the meanings specified below unless the context otherwise
requires:
"Additional Credit Party" means each Person that
becomes a Guarantor after the Closing Date by execution of a
Joinder Agreement.
"Administrative Agent" shall have the meaning assigned
to such term in the heading hereof, together with any
successors or assigns.
"Adjusted Base Rate" means the Base Rate plus the
Applicable Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate
plus the Applicable Percentage.
"Administrative Agency Services Address" means
NationsBank, N.A., NC1-001-15-04, 000 Xxxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn: Agency Services, or
such other address as may be identified by written notice
from the Administrative Agent to the Borrower.
"Affiliate" means, with respect to any Person, any
other Person (i) directly or indirectly controlling or
controlled by or under direct or indirect common control
with such Person or (ii) directly or indirectly owning or
holding ten percent (10%) or more of the Capital Stock in
such Person. For purposes of this definition, "control"
when used with respect to any Person means the power to
direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to
the foregoing.
"Agents' Fee Letter" means that certain letter
agreement, dated as of July 31, 1997, between the
Administrative Agent, the Collateral Agent and the Borrower,
as amended, modified, restated or supplemented from time to
time.
"Agents' Fees" shall have the meaning assigned to such
term in Section 3.5(d).
"Alchem" means Alchem Capital Corporation, a Delaware
corporation.
"Applicable Lending Office" means, for each Lender, the
office of such Lender (or of an Affiliate of such Lender) as
such Lender may from time to time specify to the
Administrative Agent and the Borrower by written notice as
the office by which its Eurodollar Loans are made and
maintained.
"Applicable Percentage" means, for purposes of
calculating the applicable interest rate for any day for any
Loan or the applicable rate of the Unused Fee for any day,
the appropriate applicable percentage corresponding to the
Leverage Ratio for the most recent Calculation Date:
Applicable Applicable Applicable
Pricing Leverage Percentage for Percentage for Percentage for
Level Ratio Eurodollar Base Rate Loans Unused Fee
I > 1.75% 1.00% 0.50%
4.00x
II < 1.50% 0.75% 0.375%
4.00x
but
>
3.00x
III < 1.25% 0.50% 0.25%
3.00x
but
>
2.00x
IV < 1.00% 0.25% 0.20%
2.00x
The Applicable Percentages shall be determined and adjusted
quarterly on the date (each a "Calculation Date") five
Business Days after the date by which the Borrower is
required to provide the officer's certificate in accordance
with the provisions of Section 7.1(c) for the most recently
ended fiscal quarter of the Consolidated Parties; provided,
however, that (i) the initial Applicable Percentages shall
be based on Pricing Level II (as shown above) and shall
remain at Pricing Level II until the Calculation Date
occurring on March 28, 1998 and, thereafter, the Pricing
Level shall be determined by the Leverage Ratio as of the
last day of the most recently ended fiscal quarter of the
Consolidated Parties preceding the applicable Calculation
Date, and (ii) if the Borrower fails to provide the
officer's certificate to the Administrative Agency Services
Address as required by Section 7.1(c) for the last day of
the most recently ended fiscal quarter of the Consolidated
Parties preceding the applicable Calculation Date, the
Applicable Percentage from such Calculation Date shall be
based on Pricing Level I until such time as an appropriate
officer's certificate is provided, whereupon the Pricing
Level shall be determined by the Leverage Ratio as of the
last day of the most recently ended fiscal quarter of the
Consolidated Parties preceding such Calculation Date. Each
Applicable Percentage shall be effective from one
Calculation Date until the next Calculation Date. Any
adjustment in the Applicable Percentages shall be applicable
to all existing Loans as well as any new Loans made or
issued.
"Application Period", in respect of any Asset
Disposition, shall have the meaning assigned to such term in
Section 8.5.
"Asset Disposition" means the disposition of any or all
of the assets (including without limitation the Capital
Stock of a Subsidiary) of any Consolidated Party whether by
sale, lease, transfer or otherwise, but excluding (i) the
sale of inventory in the ordinary course of business for
fair consideration and (ii) the sale or disposition of
machinery and equipment no longer used or useful in the
conduct of such Consolidated Party's business.
"Asset Disposition Prepayment Event" means, with respect
to any Asset Disposition other than an Excluded Asset
Disposition, the failure of the Borrower to apply (or cause
to be applied) the Net Cash Proceeds of such Asset
Disposition to the purchase, acquisition or construction of
Eligible Assets during the Application Period for such Asset
Disposition.
"Bankruptcy Code" means the Bankruptcy Code in Title 11
of the United States Code, as amended, modified, succeeded
or replaced from time to time.
"Bankruptcy Event" means, with respect to any Person, the
occurrence of any of the following with respect to such
Person: (i) a court or governmental agency having
jurisdiction in the premises shall enter a decree or order
for relief in respect of such Person in an involuntary case
under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of such Person or for any substantial part
of its Property or ordering the winding up or liquidation of
its affairs; or (ii) there shall be commenced against such
Person an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect,
or any case, proceeding or other action for the appointment
of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any
substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or
other case, proceeding or other action shall remain
undismissed, undischarged or unbonded for a period of sixty
(60) consecutive days; or (iii) such Person shall commence a
voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consent
to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment or taking
possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of such Person
or for any substantial part of its Property or make any
general assignment for the benefit of creditors; or (iv)
such Person shall be unable to, or shall admit in writing
its inability to, pay its debts generally as they become
due.
"Base Rate" means, for any day, the rate per annum equal
to the higher of (a) the Federal Funds Rate for such day
plus one-half of one percent (0.5%) and (b) the Prime Rate
for such day. Any change in the Base Rate due to a change
in the Prime Rate or the Federal Funds Rate shall be
effective on the effective date of such change in the Prime
Rate or Federal Funds Rate.
"Base Rate Loan" means any Loan bearing interest at a
rate determined by reference to the Base Rate.
"BNY Financial" means BNY Financial Corporation and its
successors.
"Borrower" means the Person identified as such in the
heading hereof, together with any permitted successors and
assigns.
"Borrowing Base" means, as of any day, the sum of (a) 85%
of Eligible Receivables (net of any reserves as provided in
the definition of "Eligible Receivables" set forth in this
Section 1.1) and (b) 60% of Eligible Inventory (net of any
reserves as provided in the definition of "Eligible
Inventory" set forth in this Section 1.1), in each case as
set forth in the most recent Borrowing Base Certificate
delivered to the Agent and the Lenders in accordance with
the terms of Section 7.1(d).
"Borrowing Base Parties" means the Borrower and each of
the Guarantors which is a Domestic Subsidiary of the
Borrower.
"Business Day" means a day other than a Saturday, Sunday
or other day on which commercial banks in Charlotte, North
Carolina or New York, New York are authorized or required by
law to close, except that, when used in connection with a
Eurodollar Loan, such day shall also be a day on which
dealings between banks are carried on in U.S. dollar
deposits in London, England.
"Calculation Date" has the meaning set forth in the
definition of "Applicable Percentage" set forth in this
Section 1.1.
"Capital Lease" means, as applied to any Person, any
lease of any Property (whether real, personal or mixed) by
that Person as lessee which, in accordance with GAAP, is or
should be accounted for as a capital lease on the balance
sheet of that Person.
"Capital Stock" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or
business entity, any and all shares, interests,
participations, rights or other equivalents (however
designated) of capital stock, (iii) in the case of a
partnership, partnership interests (whether general or
limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or
participation that confers on a Person the right to receive
a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (a) securities issued or
directly and fully guaranteed or insured by the United
States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United
States of America is pledged in support thereof) having
maturities of not more than twelve months from the date of
acquisition, (b) U.S. dollar denominated time deposits and
certificates of deposit of (i) any Lender, (ii) any domestic
commercial bank of recognized standing having capital and
surplus in excess of $100,000,000 or (iii) any bank whose
short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Xxxxx'x is at least P-1 or
the equivalent thereof (any such bank being an "Approved
Bank"), in each case with maturities of not more than 270
days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or
by the parent company thereof) or any variable rate notes
issued by, or guaranteed by, any domestic corporation rated
A-1 (or the equivalent thereof) or better by S&P or P-1 (or
the equivalent thereof) or better by Moody's and maturing
within six months of the date of acquisition, (d) repurchase
agreements with a bank or trust company (including any of
the Lenders) or recognized securities dealer having capital
and surplus in excess of $100,000,000 for direct obligations
issued by or fully guaranteed by the United States of
America in which any Credit Party shall have a perfected
first priority security interest (subject to no other Liens)
and having, on the date of purchase thereof, a fair market
value of at least 100% of the amount of the repurchase
obligations and (e) Investments, classified in accordance
with GAAP as current assets, in money market investment
programs registered under the Investment Company Act of
1940, as amended, which are administered by reputable
financial institutions having capital of at least
$100,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing
subdivisions (a) through (d).
"Change of Control" means the occurrence of any of the
following events: (i) Delta Woodside shall cease to own,
directly or indirectly, 100% of all of the Capital Stock of
the Borrower; or (ii) the occurrence of a "Change of
Control" under and as defined in the Senior Note Indenture.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute thereto, as interpreted
by the rules and regulations issued thereunder, in each case
as in effect from time to time. References to sections of
the Code shall be construed also to refer to any successor
sections.
"Collateral" means a collective reference to the
collateral which is identified in, and at any time will be
covered by, the Collateral Documents.
"Collateral Agent" shall have the meaning assigned to
such term in the heading hereof, together with any
successors or assigns.
"Collateral Documents" means a collective reference to
the Security Agreement, the Pledge Agreement and such other
documents executed and delivered in connection with the
attachment and perfection of the Collateral Agent's security
interests and liens arising thereunder, including without
limitation UCC financing statements.
"Commitment" means (i) with respect to each Lender, the
Revolving Commitment of such Lender, (ii) with respect to
the Swingline Lender, the Swingline Commitment, and (iii)
with respect to the Issuing Lenders, the LOC Commitment.
"Consolidated Capital Expenditures" means, for any
period, all capital expenditures of the Consolidated Parties
on a consolidated basis for such period, as determined in
accordance with GAAP.
"Consolidated Cash Taxes" means, for any period, the
aggregate of all income, value added and similar taxes of
the Consolidated Parties on a consolidated basis for such
period, as determined in accordance with GAAP, to the extent
the same are paid in cash during such period.
"Consolidated Current Assets" means, as of any date,
all items which would be classified as current assets on a
consolidated balance sheet of the Borrower and its
Subsidiaries prepared as of such date in accordance with
GAAP.
"Consolidated Current Liabilities" means, as of any
date, all items which would be classified as current
liabilities on a consolidated balance sheet of the Borrower
and its Subsidiaries prepared as of such date in accordance
with GAAP.
"Consolidated EBITDA" means, for any period, the sum of
(i) Consolidated Net Income for such period, plus (ii) an
amount which, in the determination of Consolidated Net
Income for such period, has been deducted for (A)
Consolidated Interest Expense, (B) total federal, state,
local and foreign income, value added and similar taxes and
(C) depreciation and amortization expense, all as determined
in accordance with GAAP.
"Consolidated Interest Expense" means, for any period,
interest expense (including the amortization of debt
discount and premium, the interest component under Capital
Leases and the implied interest component under Synthetic
Leases) of the Consolidated Parties on a consolidated basis
for such period, as determined in accordance with GAAP.
"Consolidated Net Income" means, for any period, net
income (excluding extraordinary items and non-operating
gains and losses (including without limitation currency
gains and losses)) after taxes for such period of the
Consolidated Parties on a consolidated basis, as determined
in accordance with GAAP.
"Consolidated Parties" means a collective reference to
the Borrower and its Subsidiaries, and "Consolidated Party"
means any one of them.
"Consolidated Scheduled Funded Debt Payments" means, as
of the end of each fiscal quarter of the Consolidated
Parties, for the Consolidated Parties on a consolidated
basis, the sum of all scheduled payments of principal on
Funded Indebtedness for the applicable period ending on such
date (including the principal component of payments due on
Capital Leases during the applicable period ending on such
date); it being understood that Scheduled Funded Debt
Payments shall not include voluntary prepayments or the
mandatory prepayments required pursuant to Section 3.3.
"Consolidated Tangible Net Worth" means, as of any
date, shareholders' equity or net worth of the Consolidated
Parties on a consolidated basis, as determined in accordance
with GAAP, less all assets of the Consolidated Parties as of
such date which should be classified as intangible assets
under GAAP (including without limitation good will).
"Consolidated Total Assets" means, as of any date, all
items which would be classified as assets on a consolidated
balance of the Borrower and its Subsidiaries prepared as of
such date in accordance with GAAP.
"Continue", "Continuation", and "Continued" shall refer
to the continuation pursuant to Section 3.2 hereof of a
Eurodollar Loan from one Interest Period to the next
Interest Period.
"Convert", "Conversion", and "Converted" shall refer to
a conversion pursuant to Section 3.2 or Sections 3.7 through
3.12, inclusive, of a Base Rate Loan into a Eurodollar Loan.
"Credit Documents" means a collective reference to this
Credit Agreement, the Notes, the LOC Documents, each Joinder
Agreement, the Agents' Fee Letter, the Collateral Documents
and all other related agreements and documents issued or
delivered hereunder or thereunder or pursuant hereto or
thereto (in each case as the same may be amended, modified,
restated, supplemented, extended, renewed or replaced from
time to time), and "Credit Document" means any one of them.
"Credit Parties" means a collective reference to the
Borrower and the Guarantors, and "Credit Party" means any
one of them.
"Credit Party Obligations" means, without duplication,
all of the obligations of the Credit Parties to the Lenders
(including the Issuing Lenders) the Administrative Agent and
the Collateral Agent, whenever arising, under this Credit
Agreement, the Notes, the Collateral Documents or any of the
other Credit Documents (including, but not limited to, any
interest accruing after the occurrence of a Bankruptcy Event
with respect to any Credit Party, regardless of whether such
interest is an allowed claim under the Bankruptcy Code).
"Current Ratio" means, with respect to the Consolidated
Parties on a consolidated basis as of the last day of any
fiscal quarter of the Consolidated Parties, the ratio of (a)
Consolidated Current Assets as of such date to (b)
Consolidated Current Liabilities as of such date.
"Debt Issuance" means the issuance of any Indebtedness
for borrowed money by any Consolidated Party. The term
"Debt Issuance" shall not include the issuance of any
Indebtedness permitted pursuant to Section 8.1.
"Default" means any event, act or condition which with
notice or lapse of time, or both, would constitute an Event
of Default.
"Defaulting Lender" means, at any time, any Lender that
(a) has failed to make a Loan or purchase a Participation
Interest required pursuant to the term of this Credit
Agreement within one Business Day of when due, (b) other
than as set forth in (a) above, has failed to pay to the
Administrative Agent, the Collateral Agent or any Lender an
amount owed by such Lender pursuant to the terms of this
Credit Agreement within one Business Day of when due, unless
such amount is subject to a good faith dispute or (c) has
been deemed insolvent or has become subject to a bankruptcy
or insolvency proceeding or with respect to which (or with
respect to any of assets of which) a receiver, trustee or
similar official has been appointed.
"Delta Woodside" means Delta Woodside Industries, Inc.,
a South Carolina corporation.
"Dollars" and "$" means dollars in lawful currency of
the United States of America.
"Domestic Subsidiary" means, with respect to any
Person, any Subsidiary of such Person which is incorporated
or organized under the laws of any State of the United
States or the District of Columbia.
"Eligible Assets" means another business or any
substantial part of another business or other long-term
assets, in each case, in, or used or useful in, the same or
a similar line of business as the Consolidated Parties were
engaged in on the Closing Date or any reasonable extensions
or expansions thereof.
"Eligible Assignee" means (i) a Lender; (ii) an
Affiliate of a Lender; and (iii) any other Person approved
by the Administrative Agent and, unless an Event of Default
has occurred and is continuing at the time any assignment is
effected in accordance with Section 11.3, the Borrower (such
approval not to be unreasonably withheld or delayed by the
Administrative Agent or the Borrower and such approval to be
deemed given by the Borrower if no objection is received by
the assigning Lender and the Administrative Agent from the
Borrower within two Business Days after notice of such
proposed assignment has been provided by the assigning
Lender to the Borrower); provided, however, that neither the
Borrower nor an Affiliate of the Borrower shall qualify as
an Eligible Assignee.
"Eligible Inventory" means, as of any date of
determination and without duplication, the lower of the
aggregate book value (based on a FIFO or a moving average
cost valuation, consistently applied) or fair market value,
less appropriate reserves determined in accordance with
GAAP, of all raw materials and finished goods inventory
owned by any Borrowing Base Party and subject to a
perfected, first priority Lien in favor of the Collateral
Agent, for the benefit of the Lenders, but excluding in any
event (i) inventory subject to any Lien, other than Liens
referred to in clauses (ii), (iv), (vi) and (xii) of the
definition of Permitted Liens, (ii) inventory which fails to
meet standards for sale or use imposed by governmental
agencies, departments or divisions having regulatory
authority over such goods, (iii) inventory which is not
useable or saleable at prices approximating their cost in
the ordinary course of the applicable Borrowing Base Party's
business (without duplication, net of any reserves for
obsolescence, unsalability or decline in value), (iv)
inventory located outside of the United States, (v)
inventory located at a location not owned or leased by the
applicable Borrowing Base Party, (vi) inventory located at a
location leased by the applicable Borrowing Base Party with
respect to which the Administrative Agent shall not have
received a landlord's waiver reasonably satisfactory to the
Administrative Agent, other than the South Xxxxxxxx Xxxx
Property (provided, however, that, after the date 90 days
from the Closing Date, inventory located at the South
Xxxxxxxx Xxxx Property shall not be Eligible Inventory
unless and until the Administrative Agent shall have
received a landlord's waiver satisfactory to the
Administrative Agent with respect to such inventory), (vii)
inventory which is leased or on consignment and (viii)
inventory which fails to meet such other specifications and
requirements as may from time to time be established by the
Administrative Agent in its reasonable discretion.
"Eligible Receivables" means, as of any date of
determination and without duplication, (A) all amounts owing
to any Borrowing Base Party under all Factoring Agreements
at such time (net of any amounts (i) which the Factors are
entitled to offset against amounts owing to any Borrowing
Base Party under such Factoring Agreements and (ii) owing by
account debtors located outside of the United States or
Canada (except to the extent that (a) payment for the goods
shipped is secured by an irrevocable letter of credit in a
form and from an institution reasonably acceptable to the
Administrative Agent or (b) the Factor has assumed the
credit risk of the related accounts receivable)) and (B) the
aggregate book value, in U.S. Dollars, of all accounts
receivable, receivables, and obligations for payment created
or arising from the sale of inventory or the rendering of
services in the ordinary course of business (collectively,
the "Receivables"), owned by or owing to any Borrowing Base
Party and subject to a perfected, first priority Lien in
favor of the Collateral Agent, for the benefit of the
Lenders, net of allowances and reserves for doubtful or
uncollectible accounts and sales adjustments consistent with
such Borrowing Base Party's internal policies and in any
event in accordance with GAAP, but excluding in any event
from this clause (B) (i) Receivables subject to any Lien,
other than Liens in favor of the Collateral Agent, for the
benefit of the Lenders, (ii) Receivables which are more than
60 days past due (net of reserves for bad debts in
connection with any such Receivables), (iii) Receivables
evidenced by notes, chattel paper or other instruments,
unless such notes, chattel paper or instruments have been
delivered to and are in the possession of the Collateral
Agent, (iv) Receivables owing by an account debtor which is
not solvent or is subject to any bankruptcy or insolvency
proceeding of any kind (net of any reserves in connection
with any such Receivables), (v) Receivables owing by an
account debtor located outside of the United States or
Canada (unless payment for the goods shipped is secured by
an irrevocable letter of credit in a form and from an
institution reasonably acceptable to the Administrative
Agent), provided that, at any time, no more than $5,000,000
in aggregate Receivables owing by account debtors in Canada
may be included as Eligible Receivables, (vi) Receivables
which are contingent or as to which the account debtor has
made a claim for offset, deduction, or counterclaim, or is
disputing, or raising other defenses to, payment, but in
each case only to the extent of such offset, deduction,
counterclaim, dispute or other defense and net of any
reserves in connection with any such Receivables, (vii)
Receivables for which any direct or indirect Subsidiary of
the Borrower or any Affiliate of the Borrower is the account
debtor, (viii) Receivables, to the extent exceeding
$2,500,000 in the aggregate at any one time, representing a
sale to the government of the United States of America or
any subdivision thereof unless the applicable Borrowing Base
Party has complied (to the reasonable satisfaction of the
Administrative Agent), with respect to the granting of a
security interest in such Receivable, with the Federal
Assignment of Claims Act or other similar applicable law, in
which case all such Receivables may be included as Eligible
Receivables, (ix) Receivables arising from the sale to an
account debtor on a xxxx-and-hold, guaranteed sale, sale or
return, sale on approval, consignment or any other
repurchase or return basis and (x) Receivables which fail to
meet such other specifications and requirements as may from
time to time be established by the Administrative Agent in
its reasonable discretion.
"Environmental Laws" means any and all lawful and
applicable Federal, state, local and foreign statutes, laws,
regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to
the environment or to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals,
or industrial, toxic or 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, chemicals, or industrial, toxic or
hazardous substances or wastes.
"Equity Issuance" means any issuance by any Consolidated
Party to any Person which is not a Consolidated Party of (a)
shares of its Capital Stock, (b) any shares of its Capital
Stock pursuant to the exercise of options or warrants or (c)
any shares of its Capital Stock pursuant to the conversion
of any debt securities to equity.
"ERISA" means the Employee Retirement Income Security Act
of 1974, as amended, and any successor statute thereto, as
interpreted by the rules and regulations thereunder, all as
the same may be in effect from time to time. References to
sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity which is under common
control with any Consolidated Party within the meaning of
Section 4001(a)(14) of ERISA, or is a member of a group
which includes the Borrower and which is treated as a single
employer under Sections 414(b) or (c) of the Code.
"ERISA Event" means (i) with respect to any Plan, the
occurrence of a Reportable Event or the substantial
cessation of operations (within the meaning of Section
4062(e) of ERISA); (ii) the withdrawal by any Consolidated
Party or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a substantial employer
(as such term is defined in Section 4001(a)(2) of ERISA), or
the termination of a Multiple Employer Plan; (iii) the
distribution of a notice of intent to terminate or the
actual termination of a Plan pursuant to Section 4041(a)(2)
or 4041A of ERISA; (iv) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC
under Section 4042 of ERISA; (v) any event or condition
which might constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to
administer, any Plan; (vi) the complete or partial
withdrawal of any Consolidated Party or any ERISA Affiliate
from a Multiemployer Plan; (vii) the conditions for
imposition of a lien under Section 302(f) of ERISA exist
with respect to any Plan; or (vii) the adoption of an
amendment to any Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.
"Eurodollar Loan" means any Revolving Loan that bears
interest at a rate based upon the Eurodollar Rate.
"Eurodollar Rate" means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%)
determined by the Administrative Agent to be equal to the
quotient obtained by dividing (a) the Interbank Offered Rate
for such Eurodollar Loan for such Interest Period by (b) 1
minus the Eurodollar Reserve Requirement for such Eurodollar
Loan for such Interest Period.
"Eurodollar Reserve Requirement" means, at any time, the
maximum rate at which reserves (including, without
limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor)
by member banks of the Federal Reserve System against
"Eurocurrency liabilities" (as such term is used in
Regulation D). Without limiting the effect of the
foregoing, the Eurodollar Reserve Requirement shall reflect
any other reserves required to be maintained by such member
banks with respect to (i) any category of liabilities which
includes deposits by reference to which the Adjusted
Eurodollar Rate is to be determined, or (ii) any category of
extensions of credit or other assets which include
Eurodollar Loans. The Adjusted Eurodollar Rate shall be
adjusted automatically on and as of the effective date of
any change in the Eurodollar Reserve Requirement.
"Event of Default" means such term as defined in Section
9.1.
"Excluded Asset Disposition" means (i) any Asset
Disposition by any Consolidated Party to any Consolidated
Party if (a) the Credit Parties shall cause to be executed
and delivered such documents, instruments and certificates
as the Administrative Agent may request so as to cause the
Credit Parties to be in compliance with the terms of Section
7.13 after giving effect to such Asset Disposition and (b)
after giving effect to such Asset Disposition, no Default or
Event of Default exists, (ii) any Equity Issuance, (iii)
sales of accounts pursuant to a Factoring Agreement, (iv)
any Asset Disposition not constituting a substantial part of
the assets of any Person if neither the book value of such
assets nor the Net Cash Proceeds of such Asset Disposition
exceeds $100,000 and (v) any other Asset Disposition not
described in clause (i), (ii), (iii) or (iv) above if and to
the extent that the aggregate Net Cash Proceeds of all such
Asset Dispositions received by the Consolidated Parties on
or after the Closing Date does not exceed $5,000,000.
"Excluded Equity Issuance" means (i) any Asset
Disposition, (ii) any capital contribution to any
Consolidated Party by Delta Woodside or Alchem or (iii) any
Equity Issuance by any Consolidated Party to any of its
employees, officers or directors pursuant of the exercise of
options or warrants or as part of any compensation package.
"Executive Officer" of any Person means any of the chief
executive officer, chief operating officer, president, vice
president, chief financial officer or treasurer of such
Person.
"Existing Credit Facility" means the credit facility in
favor of Delta Woodside evidenced by that certain amended
and restated credit agreement dated as of March 15, 1996, as
amended from time to time thereafter, among Delta Woodside,
the Lenders named therein, NationsBank, N.A., as Agent, and
Bank of America National Trust and Savings Association and
The Bank of New York, as Co-Agents.
"Existing Letter of Credit" means any one of the letters
of credit described by date of issuance, letter of credit
number, undrawn amount, name of beneficiary and date of
expiry on Schedule 1.1A.
"Factor" means such term as defined in the definition of
"Factoring Agreement" set forth in this Section 1.1.
"Factoring Agreement" means each agreement between the
Borrower or any of its Subsidiaries and BNY Financial or any
other Person approved by the Required Lenders (each of BNY
Financial and each such other Person, in such capacity, a
"Factor"), providing for credit, collection and application
services to be performed by a Factor with respect to
accounts receivable of the Borrower or any of such
Subsidiaries, as applicable, and/or for the purchase by a
Factor, subject to the terms thereof, of some or all of such
accounts receivable, and which may grant to a Factor a
security interest in the factored accounts receivable and
related property of the Borrower or any of such
Subsidiaries, as applicable.
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New
York on the Business Day next succeeding such day; provided
that (a) if such day is not a Business Day, the Federal
Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the
average rate charged to the Administrative Agent (in its
individual capacity) on such day on such transactions as
determined by the Administrative Agent.
"Foreign Subsidiary" means, with respect to any Person,
any Subsidiary of such Person which is not a Domestic
Subsidiary of such Person.
"Funded Indebtedness" means, with respect to any Person,
without duplication, (a) all Indebtedness of such Person
other than Indebtedness of the types referred to in clause
(e), (f), (g), (i), (k), (l) and (m) of the definition of
"Indebtedness" set forth in this Section 1.1, (b) all
Indebtedness of another Person of the type referred to in
clause (a) above secured by (or for which the holder of such
Funded Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, Property owned or acquired
by such Person, whether or not the obligations secured
thereby have been assumed, (c) all Guaranty Obligations of
such Person with respect to Indebtedness of the type
referred to in clause (a) above of another Person and (d)
Indebtedness of the type referred to in clause (a) above of
any partnership or unincorporated joint venture in which
such Person is legally obligated or has a reasonable
expectation of being liable with respect thereto.
"GAAP" means generally accepted accounting principles in
the United States applied on a consistent basis and subject
to the terms of Section 1.3.
"Governmental Authority" means any Federal, state, local
or foreign court or governmental agency, authority,
instrumentality or regulatory body.
"Guarantor" means each of the Persons identified as a
"Guarantor" on the signature pages hereto and each
Additional Credit Party which may hereafter execute a
Joinder Agreement, together with their successors and
permitted assigns, and "Guarantor" means any one of them.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations of such Person (other
than endorsements in the ordinary course of business of
negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of
any other Person in any manner, whether direct or indirect,
and including without limitation any obligation, whether or
not contingent, (i) to purchase any such Indebtedness or any
Property constituting security therefor, (ii) to advance or
provide funds or other support for the payment or purchase
of any such Indebtedness or to maintain working capital,
solvency or other balance sheet condition of such other
Person (including without limitation keep well agreements,
maintenance agreements, comfort letters or similar
agreements or arrangements) for the benefit of any holder of
Indebtedness of such other Person, (iii) to lease or
purchase Property, securities or services primarily for the
purpose of assuring the holder of such Indebtedness, or (iv)
to otherwise assure or hold harmless the holder of such
Indebtedness against loss in respect thereof. The amount of
any Guaranty Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum
principal amount, if larger) of the Indebtedness in respect
of which such Guaranty Obligation is made.
"Hedging Agreements" means any interest rate protection
agreement or foreign currency exchange agreement.
"Indebtedness" of any Person means (a) all obligations of
such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily
made, (c) all obligations of such Person under conditional
sale or other title retention agreements relating to
Property purchased by such Person (other than customary
reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business),
(d) all obligations of such Person issued or assumed as the
deferred purchase price of Property or services purchased by
such Person (other than (i) trade debt incurred in the
ordinary course of business and due within six months of the
incurrence thereof and (ii) deferred compensation payable to
employees of such Person on a basis generally consistent
with past practices) which would appear as liabilities on a
balance sheet of such Person, (e) all obligations of such
Person under take-or-pay or similar arrangements or
commodities agreements not entered into in the ordinary
course of such Person's business, (f) all Indebtedness of
others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien on, or payable out of the
proceeds of production from, Property owned or acquired by
such Person, whether or not the obligations secured thereby
have been assumed, (g) all Guaranty Obligations of such
Person, (h) the principal portion of all obligations of such
Person under Capital Leases (but not under Operating
Leases), (i) all obligations of such Person under Hedging
Agreements, (j) the maximum amount of all standby letters of
credit issued or bankers' acceptances facilities created for
the account of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (k)
all preferred Capital Stock issued by such Person and
required by the terms thereof to be redeemed, or for which
mandatory sinking fund payments are due, by a fixed date,
(l) the principal portion of all obligations of such Person
under Synthetic Leases and (m) the Indebtedness of any
partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer.
"Interbank Offered Rate" means, for any Eurodollar Loan
for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such
rate is not available, the term "Interbank Offered Rate"
shall mean, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO
Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Reuters
Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded upwards, if
necessary, to the nearest 1/100 of 1%).
"Interest Coverage Ratio" means, with respect to the
Consolidated Parties on a consolidated basis for the twelve
month period ending on the last day of any fiscal quarter of
the Consolidated Parties, the ratio of (a) Consolidated
EBITDA for such period to (b) Consolidated Interest Expense
for such period.
"Interest Payment Date" means (a) as to Base Rate Loans,
the last day of each fiscal quarter of the Borrower and the
Maturity Date, and (b) as to Eurodollar Loans, the last day
of each applicable Interest Period and the Maturity Date,
and in addition where the applicable Interest Period for a
Eurodollar Loan is greater than three months, then also the
date three months from the beginning of the Interest Period
and each three months thereafter.
"Interest Period" means (i) as to Eurodollar Loans, a
period of one, two, three or six months' duration, as the
Borrower may elect, commencing, in each case, on the date of
the borrowing (including continuations and conversions
thereof) and (ii) as to any Swingline Loan, a period
commencing in each case on the date of the borrowing and
ending on the date agreed to by the Borrower and the
Swingline Lender in accordance with the provisions of
Section 2.3(b)(i) (such ending date in any event to be not
more than seven (7) Business Days from the date of
borrowing); provided, however, (a) if any Interest Period
would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding
Business Day (except that where the next succeeding Business
Day falls in the next succeeding calendar month, then on the
next preceding Business Day), (b) no Interest Period shall
extend beyond the Maturity Date and (c) where an Interest
Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the
Interest Period is to end, such Interest Period shall end on
the last Business Day of such calendar month.
"Investment" in any Person means (a) the acquisition
(whether for cash, property, services, assumption of
Indebtedness, securities or otherwise) of assets, shares of
Capital Stock, bonds, notes, debentures, partnership, joint
ventures or other ownership interests or other securities of
such other Person or (b) any deposit with, or advance, loan
or other extension of credit to, such Person (other than
deposits made in connection with the purchase of equipment
or other assets in the ordinary course of business) or (c)
any other capital contribution to or investment in such
Person, including, without limitation, any Guaranty
Obligations (including any support for a letter of credit
issued on behalf of such Person) incurred for the benefit of
such Person, but excluding any Restricted Payment to such
Person.
"Issuing Lenders" means NationsBank and BNY Financial (or
its Affiliate, The Bank of New York), together with their
successors and permitted assigns, and "Issuing Lender" means
any one of them.
"Issuing Lender Fees" shall have the meaning assigned to
such term in Section 3.5(c)(ii).
"Joinder Agreement" means a Joinder Agreement
substantially in the form of Exhibit 7.12 hereto, executed
and delivered by an Additional Credit Party in accordance
with the provisions of Section 7.12.
"Lender" means any of the Persons identified as a
"Lender" on the signature pages hereto, and any Person which
may become a Lender by way of assignment in accordance with
the terms hereof, together with their successors and
permitted assigns.
"Letter of Credit" means (i) any letter of credit issued
by an Issuing Lender for the account of the Borrower in
accordance with the terms of Section 2.2 and (ii) each
Existing Letter of Credit.
"Leverage Ratio" means, with respect to the Consolidated
Parties on a consolidated basis for the twelve month period
ending on the last day of any fiscal quarter, the ratio of
(a) Funded Indebtedness of the Consolidated Parties on a
consolidated basis on the last day of such period to (b)
Consolidated EBITDA for such period.
"Lien" means any mortgage, pledge, hypothecation,
assignment, deposit arrangement, security interest,
encumbrance, lien (statutory or otherwise), preference,
priority or charge of any kind (including any agreement to
give any of the foregoing, any conditional sale or other
title retention agreement, any financing or similar
statement or notice filed under the Uniform Commercial Code
as adopted and in effect in the relevant jurisdiction or
other similar recording or notice statute, and any lease in
the nature thereof).
"Loan" or "Loans" means the Revolving Loans (or a portion
of any Revolving Loan bearing interest at the Adjusted Base
Rate or the Adjusted Eurodollar Rate and referred to as a
Base Rate Loan or a Eurodollar Loan) and/or the Swingline
Loans (or any Swingline Loan bearing interest at the
Adjusted Base Rate or the Quoted Rate and referred to as a
Base Rate Loan or a Quoted Rate Swingline Loan),
individually or collectively, as appropriate.
"LOC Commitment" means the commitment of the Issuing
Lenders to issue Letters of Credit in an aggregate face
amount at any time outstanding (together with the amounts of
any unreimbursed drawings thereon) of up to the LOC
Committed Amount.
"LOC Committed Amount" shall have the meaning assigned to
such term in Section 2.2.
"LOC Documents" means, with respect to any Letter of
Credit, such Letter of Credit, any amendments thereto, any
documents delivered in connection therewith, any application
therefor, and any agreements, instruments, guarantees or
other documents (whether general in application or
applicable only to such Letter of Credit) governing or
providing for (i) the rights and obligations of the parties
concerned or at risk or (ii) any collateral security for
such obligations.
"LOC Obligations" means, at any time, the sum of (i) the
maximum amount which is, or at any time thereafter may
become, available to be drawn under Letters of Credit then
outstanding, assuming compliance with all requirements for
drawings referred to in such Letters of Credit plus (ii) the
aggregate amount of all drawings under Letters of Credit
honored by an Issuing Lender but not theretofore reimbursed
by the Borrower.
"Material Adverse Effect" means a material adverse effect
on (i) the condition (financial or otherwise), operations,
business, assets, liabilities or prospects of any
Consolidated Party, (ii) the ability of Alchem or any Credit
Party to perform any material obligation under the Credit
Documents to which it is a party or (iii) the material
rights and remedies of the Lenders under the Credit
Documents.
"Materials of Environmental Concern" means any gasoline
or petroleum (including crude oil or any fraction thereof)
or petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or
under any Environmental Laws, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.
"Maturity Date" means August 25, 2002.
"Moody's" means Xxxxx'x Investors Service, Inc., or any
successor or assignee of the business of such company in the
business of rating securities.
"Multiemployer Plan" means a Plan which is a
multiemployer plan as defined in Sections 3(37) or
4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any
Consolidated Party or any ERISA Affiliate and at least one
employer other than the Consolidated Parties or any ERISA
Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. and its successors.
"Net Cash Proceeds" means, in respect of any Asset
Disposition, Equity Issuance or Debt Issuance, the sum of
(i) cash, (ii) an amount equal to the value of readily
marketable securities and (iii) the principal amount of any
promissory note, received at any time by the Consolidated
Parties in consideration of such transaction, net of (a)
direct costs (including, without limitation, legal,
accounting and investment banking fees, and sales
commissions) and (b) taxes paid or payable as a result
thereof. Net Cash Proceeds shall be deemed to be received
for purposes of this Credit Agreement (A) in the case of
cash, when paid to the recipient, (B) in the case of readily
marketable securities, when delivered to the recipient in
form for transfer and (C) when evidenced by a promissory
note (1) secured by a valid, perfected first priority
security interest in or first mortgage lien on the assets so
sold or disposed of, when payments of principal are received
thereunder and (2) not secured as provided in clause (1),
when payments of principal would have been received
thereunder if such principal were required to be repaid in
substantially equal consecutive annual installments over a
period of three years commencing on the date of delivery of
such note or, if earlier, when payments of principal are
actually received thereunder.
"New Delta Woodside Credit Facility" means the credit
facility in favor of Delta Woodside evidenced by that
certain credit agreement dated as of the date hereof among
Delta Woodside, the Guarantors named therein, the Lenders
named therein and NationsBank, N.A., as Agent.
"Note" or "Notes" means the Revolving Notes and/or the
Swingline Note, individually or collectively, as
appropriate.
"Notice of Borrowing" means a written notice of borrowing
in substantially the form of Exhibit 2.1(b)(i), as required
by Section 2.1(b)(i).
"Notice of Extension/Conversion" means the written notice
of extension or conversion in substantially the form of
Exhibit 3.2, as required by Section 3.2.
"Operating Lease" means, as applied to any Person, any
lease (including, without limitation, leases which may be
terminated by the lessee at any time) of any Property
(whether real, personal or mixed) which is not a Capital
Lease other than any such lease in which that Person is the
lessor.
"Other Taxes" means such term as is defined in Section
3.11.
"Participation Interest" means a purchase by a Lender of
a participation in Letters of Credit or LOC Obligations as
provided in Section 2.2, in Swingline Loans as provided in
Section 2.3(b)(iii) or in any Loans as provided in Section
3.14.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and
any successor thereof.
"Permitted Investments" means Investments which are (i)
cash and Cash Equivalents; (ii) accounts receivable created,
acquired or made by any Consolidated Party in the ordinary
course of business and payable or dischargeable in
accordance with customary trade terms; (iii) Investments
consisting of Capital Stock, obligations, securities or
other property received by any Consolidated Party in
settlement of accounts receivable (created in the ordinary
course of business) from bankrupt obligors; (iv) Investments
existing as of the Closing Date and set forth in Schedule
1.1B; (v) transactions permitted by Section 8.9; (vi)
advances or loans to directors, officers, employees, agents,
customers or suppliers that do not exceed $2,000,000 in the
aggregate at any one time outstanding for all of the
Consolidated Parties; (vii) Investments in Delta Woodside
and its Subsidiaries that do not, taken together with
Restricted Payments made pursuant to Section 8.7(d), exceed
$500,000 in the aggregate at any one time outstanding for
all of the Consolidated Parties; or (viii) Investments in
any Credit Party.
"Permitted Liens" means:
(i) Liens in favor of the Collateral Agent and/or the
Administrative Agent to secure the Credit Party Obligations;
(ii) Liens (other than Liens created or imposed under
ERISA) for taxes, assessments or governmental charges or
levies not yet due or Liens for taxes being contested in
good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been
established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on
account thereof);
(iii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other
Liens imposed by law or pursuant to customary reservations
or retentions of title arising in the ordinary course of
business, provided that such Liens secure only amounts not
yet due and payable or, if due and payable, are unfiled and
no other action has been taken to enforce the same or are
being contested in good faith by appropriate proceedings for
which adequate reserves determined in accordance with GAAP
have been established (and as to which the Property subject
to any such Lien is not yet subject to foreclosure, sale or
loss on account thereof);
(iv) Liens (other than Liens created or imposed under
ERISA) incurred or deposits made by any Consolidated Party
in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other
types of social security, or to secure the performance of
tenders, statutory obligations, bids, leases, government
contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the
payment of borrowed money);
(v) Liens in connection with attachments or judgments
(including judgment or appeal bonds) provided that the
judgments secured shall, within 60 days after the entry
thereof, have been discharged or execution thereof stayed
pending appeal, or shall have been discharged within 60 days
after the expiration of any such stay;
(vi) easements, rights-of-way, restrictions (including
zoning restrictions), minor defects or irregularities in
title and other similar charges or encumbrances not, in any
material respect, impairing the use of the encumbered
Property for its intended purposes;
(vii) Liens on Property securing purchase money
Indebtedness (including Capital Leases and Synthetic Leases)
to the extent permitted under Section 8.1(c), provided that
any such Lien attaches to such Property concurrently with or
within 90 days after the acquisition thereof;
(viii) any interest of title of a lessor under, and Liens
arising from UCC financing statements (or equivalent
filings, registrations or agreements in foreign
jurisdictions) relating to, leases permitted by this Credit
Agreement;
(ix) Liens in connection with a Factoring Agreement, but
(i) only to the extent of the applicable accounts receivable
subject to such Factoring Agreement and related property and
(ii) only if the proceeds payable thereunder have been
assigned to the Collateral Agent for the benefit of the
Lenders in a manner reasonably acceptable to the
Administrative Agent;
(x) Liens deemed to exist in connection with Investments
in repurchase agreements permitted under Section 8.6;
(xi) normal and customary rights of setoff upon deposits
of cash in favor of banks or other depository institutions;
and
(xii) Liens existing as of the Closing Date and set forth
on Schedule 1.1C; provided that no such Lien shall at any
time be extended to or cover any Property other than the
Property subject thereto on the Closing Date.
Notwithstanding anything to the contrary set forth in this
definition or in any other provision of this Credit
Agreement, the term "Permitted Liens" shall not include any
Lien on Property of any Consolidated Party securing any
Indebtedness of Delta Woodside or any of its Subsidiaries
other than Liens securing any Guaranty Obligation arising in
connection with standby letters of credit or surety bonds
issued to satisfy workers' compensation requirements.
"Person" means any individual, partnership, joint
venture, firm, corporation, limited liability company,
association, trust or other enterprise (whether or not
incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in
Section 3(3) of ERISA) which is covered by ERISA and with
respect to which any Consolidated Party or any ERISA
Affiliate is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means the pledge agreement dated as of
the Closing Date in the form of Exhibit 1.1A to be executed
in favor of the Collateral Agent by Alchem and each of the
Credit Parties, as amended, modified, restated or
supplemented from time to time.
"Prime Rate" means the per annum rate of interest
established from time to time by NationsBank as its prime
rate, which rate may not be the lowest rate of interest
charged by NationsBank to its customers.
"Principal Office" means the principal office of
NationsBank, presently located at Charlotte, North Carolina.
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or
intangible.
"Quoted Rate" means, with respect to any Quoted Rate
Swingline Loan, the fixed percentage rate per annum offered
by the Swingline Lender and accepted by the Borrower with
respect to such Swingline Loan as provided in accordance
with the provisions of Section 2.3.
"Quoted Rate Swingline Loan" means a Swingline Loan
bearing interest at a Quoted Rate.
"Refinancing" shall have the meaning given such term in
Section 6.15.
"Register" shall have the meaning given such term in
Section 11.3(c).
"Regulation G, T, U, or X" means Regulation G, T, U or X,
respectively, of the Board of Governors of the Federal
Reserve System as from time to time in effect and any
successor to all or a portion thereof.
"Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing into the environment
(including the abandonment or discarding of barrels,
containers and other closed receptacles containing any
Materials of Environmental Concern).
"Reportable Event" means any of the events set forth in
Section 4043(c) of ERISA, other than those events as to
which the notice requirement has been waived by regulation.
"Required Lenders" means, at any time, Lenders which are
then in compliance with their obligations hereunder (as
determined by the Administrative Agent) and holding in the
aggregate at least 51% of (i) the Revolving Commitments (and
Participation Interests therein) or (ii) if the Commitments
have been terminated, the outstanding Loans and
Participation Interests (including the Participation
Interests of the Issuing Lenders in Letters of Credit).
"Requirement of Law" means, as to any Person, the
certificate of incorporation and by-laws or other
organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any
of its material property is subject.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares
of any class of Capital Stock of any Consolidated Party, now
or hereafter outstanding, (ii) any redemption, retirement,
sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of
any class of Capital Stock of any Consolidated Party, now or
hereafter outstanding, (iii) any payment made to retire, or
to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of
Capital Stock of any Consolidated Party, now or hereafter
outstanding and (iv) any other payment, distribution or
transfer of cash or Property to Delta Woodside or any of its
Subsidiaries not constituting an Investment and not
described in clause (i), (ii) or (iii) above.
"Revolving Commitment" means, with respect to each
Lender, the commitment of such Lender in an aggregate
principal amount at any time outstanding of up to such
Lender's Revolving Commitment Percentage of the Revolving
Committed Amount, (i) to make Revolving Loans in accordance
with the provisions of Section 2.1(a), (ii) to purchase
Participation Interests in Letters of Credit in accordance
with the provisions of Section 2.2(c) and (iii) to purchase
Participation Interests in the Swingline Loans in accordance
with the provisions of Section 2.3(b)(iii).
"Revolving Commitment Percentage" means, for any Lender,
the percentage identified as its Revolving Commitment
Percentage on Schedule 2.1(a), as such percentage may be
modified in connection with any assignment made in
accordance with the provisions of Section 11.3.
"Revolving Committed Amount" shall have the meaning
assigned to such term in Section 2.1(a).
"Revolving Loans" shall have the meaning assigned to such
term in Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the
promissory notes of the Borrower in favor of each of the
Lenders evidencing the Revolving Loans provided pursuant to
Section 2.1(e), individually or collectively, as
appropriate, as such promissory notes may be amended,
modified, restated, supplemented, extended, renewed or
replaced from time to time.
"S&P" means Standard & Poor's Ratings Group, a division
of McGraw Hill, Inc., or any successor or assignee of the
business of such division in the business of rating
securities.
"Sale and Leaseback Transaction" means any direct or
indirect arrangement with any Person or to which any such
Person is a party, providing for the leasing to any
Consolidated Party of any Property, whether owned by such
Consolidated Party as of the Closing Date or later acquired,
which has been or is to be sold or transferred by such
Consolidated Party to such Person or to any other Person
from whom funds have been, or are to be, advanced by such
Person on the security of such Property.
"Security Agreement" means the security agreement dated
as of the Closing Date in the form of Exhibit 1.1B to be
executed in favor of the Collateral Agent by each of the
Credit Parties, as amended, modified, restated or
supplemented from time to time.
"Senior Note" means any one of the 9-5/8% Notes due 2007
issued by the Borrower in favor of the Senior Noteholders
pursuant to the Senior Note Indenture (including without
limitation the exchange of Series B Notes for Series A Notes
thereunder), as such Senior Notes may be amended, modified,
restated or supplemented and in effect from time to time.
"Senior Note Indenture" means the Indenture dated as of
the Closing Date by and between the Borrower, Delta Xxxxx
Marketing, Inc. and The Bank of New York, in its capacity as
trustee for the Senior Noteholders, as the same may be
amended, modified, restated or supplemented and in effect
from time to time.
"Senior Noteholder" means any one of the holders from
time to time of the Senior Notes.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan or
a Multiple Employer Plan.
"Solvent" or "Solvency" means, with respect to any Person
as of a particular date, that on such date (i) such Person
is able to realize upon its assets and pay its debts and
other liabilities, contingent obligations and other
commitments as they mature in the normal course of business,
(ii) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature
in their ordinary course, (iii) such Person is not engaged
in a business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's
Property would constitute unreasonably small capital after
giving due consideration to the prevailing practice in the
industry in which such Person is engaged or is to engage,
(iv) the fair value of the Property of such Person is
greater than the total amount of liabilities, including,
without limitation, contingent liabilities, of such Person
and (v) the present fair salable value of the assets of such
Person is not less than the amount that will be required to
pay the probable liability of such Person on its debts as
they become absolute and matured. In computing the amount
of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in
light of all the facts and circumstances existing at such
time, represents the amount that can reasonably be expected
to become an actual or matured liability.
"South Carolina Bond Property" means all property, both
real and personal, subject to the South Carolina Lease.
"South Carolina Lease" means that certain lease
agreement, dated as of May 26, 1994, among Xxxxxxxx County,
South Carolina, Greenville County, South Carolina and
Marlboro County, South Carolina and the Borrower, as Lessee.
"Standby Letter of Credit Fee" shall have the meaning
assigned to such term in Section 3.5(c)(i).
"Subsidiary" means, as to any Person, (a) any corporation
more than 50% of whose Capital Stock of any class or classes
having by the terms thereof ordinary voting power to elect a
majority of the directors of such corporation (irrespective
of whether or not at the time, any class or classes of such
corporation shall have or might have voting power by reason
of the happening of any contingency) is at the time owned by
such Person directly or indirectly through Subsidiaries, and
(b) any partnership, association, joint venture or other
entity of which such Person directly or indirectly through
Subsidiaries has more than 50% of the Capital Stock at any
time; provided, however, that, notwithstanding the
foregoing, the Borrower and its direct and indirect
Subsidiaries shall not be deemed to be a direct or indirect
Subsidiary of Delta Woodside or of any other Subsidiaries of
Delta Woodside.
"Swingline Commitment" means the commitment of the
Swingline Lender to make Swingline Loans in an aggregate
principal amount at any time outstanding of up to the
Swingline Committed Amount.
"Swingline Committed Amount" shall have the meaning
assigned to such term in Section 2.3(a).
"Swingline Lender" means NationsBank.
"Swingline Loan" shall have the meaning assigned to such
term in Section 2.3(a).
"Swingline Note" means the promissory note of the
Borrower in favor of the Swingline Lender evidencing the
Swingline Loans provided pursuant to Section 2.3(d), as such
promissory note may be amended, modified, restated,
supplemented, extended, renewed or replaced from time to
time.
"Synthetic Lease" means any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product where such transaction
is considered borrowed money indebtedness for tax purposes
but is classified as an Operating Lease.
"Taxes" means such term as is defined in Section 3.11.
"Trade Letter of Credit Fee" shall have the meaning
assigned to such term in Section 3.5(c)(ii).
"Trading Assets" means (i) all accounts, chattel paper,
instruments, documents and general intangibles of any Credit
Party and all other obligations of any kind owed to any
Credit party, whether long-term or short-term, now or
hereafter existing, to the extent arising out of or
resulting from the sale or lease of inventory or the
rendition of services by such Credit Party, and all rights
now or hereafter existing in and to all security agreements,
guarantees, letters of credit and other contracts securing,
guaranteeing or otherwise relating to any such accounts,
chattel paper, instruments, documents, general intangibles
or other obligations, (ii) all inventory of any Credit Party
and (iii) all proceeds of any the foregoing. As used in
this definition of "Trading Assets", the terms "accounts",
"inventory", "chattel paper", "instruments", "documents",
"general intangibles" and "proceeds" shall have the meanings
assigned to such terms in the Uniform Commercial Code in
effect in the State of North Carolina on the Closing Date.
"Unused Fee" shall have the meaning assigned to such term
in Section 3.5(b).
"Unused Fee Calculation Period" shall have the meaning
assigned to such term in Section 3.5(b).
"Unused Revolving Committed Amount" means, for any
period, the amount by which (a) the then applicable
Revolving Committed Amount exceeds (b) the daily average sum
for such period of (i) the outstanding aggregate principal
amount of all Revolving Loans (but not including any
Swingline Loans) plus (ii) the outstanding aggregate
principal amount of all LOC Obligations.
"Upfront Fee" shall have the meaning assigned to such
term in Section 3.5(a).
"Voting Stock" means, with respect to any Person, Capital
Stock issued by such Person the holders of which are
ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing
similar functions) of such Person, even though the right so
to vote has been suspended by the happening of such a
contingency.
"Wholly Owned Subsidiary" of any Person means any
Subsidiary 100% of whose Voting Stock is at the time owned
by such Person directly or indirectly through other Wholly
Owned Subsidiaries.
1.2 Computation of Time Periods.
For purposes of computation of periods of time hereunder,
the word "from" means "from and including" and the words
"to" and "until" each mean "to but excluding."
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all
accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied
on a consistent basis. All calculations made for the
purposes of determining compliance with this Credit
Agreement shall (except as otherwise expressly provided
herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly
financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements
pursuant to Section 7.1, consistent with the financial
statements as at June 28, 1997); provided, however, if (a)
the Borrower shall object to determining such compliance on
such basis at the time of delivery of such financial
statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) the Administrative
Agent or the Required Lenders shall so object in writing
within 60 days after delivery of such financial statements,
then such calculations shall be made on a basis consistent
with the most recent financial statements delivered by the
Borrower to the Lenders as to which no such objection shall
have been made.
Notwithstanding the above, the parties hereto acknowledge and
agree that, for purposes of all calculations made in
determining compliance with the financial covenants set
forth in Section 7.11 (including without limitation for
purposes of the definition of "Applicable Percentage" set
forth in Section 1.1), (i)(A) income statement items
(whether positive or negative) attributable to the Property
disposed of in any Asset Disposition as contemplated by
Section 8.5, as applicable, shall be excluded to the extent
relating to any period occurring prior to the date of such
transaction and (B) Indebtedness which is retired in
connection with any such Asset Disposition shall be excluded
and deemed to have been retired as of the first day of the
applicable period and (ii) income statement items (whether
positive or negative) attributable to any Property acquired
in any Investment transaction contemplated by Section 8.6
shall be included to the extent relating to any period
applicable in such calculations occurring after the date of
such transaction (and, notwithstanding the foregoing, during
the first four fiscal quarters following the date of such
transaction, shall be included on an annualized basis).
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans.
(a) Revolving Commitment. Subject to the terms and
conditions hereof and in reliance upon the representations
and warranties set forth herein, each Lender severally
agrees to make available to the Borrower such Lender's
Revolving Commitment Percentage of revolving credit loans
requested by the Borrower in Dollars ("Revolving Loans")
from time to time from the Closing Date until the Maturity
Date, or such earlier date as the Revolving Commitments
shall have been terminated as provided herein for the
purposes hereinafter set forth; provided, however, that the
sum of the aggregate principal amount of outstanding
Revolving Loans shall not exceed ONE HUNDRED MILLION DOLLARS
($100,000,000.00) (as such aggregate maximum amount may be
reduced from time to time as provided in Section 3.4, the
"Revolving Committed Amount"); provided, further, (A) with
respect to each individual Lender, the Lender's pro rata
share of outstanding Revolving Loans plus its pro rata share
of outstanding LOC Obligations plus its pro rata share of
outstanding Swingline Loans shall not exceed such Lender's
Revolving Commitment Percentage of the Revolving Committed
Amount, and (B) the aggregate principal amount of
outstanding Revolving Loans plus LOC Obligations outstanding
plus Swingline Loans outstanding shall not exceed the lesser
of (1) the Revolving Committed Amount and (2) the Borrowing
Base. Revolving Loans may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower
may request, and may be repaid and reborrowed in accordance
with the provisions hereof; provided, however, that no more
than 5 Eurodollar Loans shall be outstanding hereunder at
any time. For purposes hereof, Eurodollar Loans with
different Interest Periods shall be considered as separate
Eurodollar Loans, even if they begin on the same date,
although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the
end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period. Revolving
Loans hereunder may be repaid and reborrowed in accordance
with the provisions hereof.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall
request a Revolving Loan borrowing by written notice (or
telephonic notice promptly confirmed in writing) to the
Administrative Agent not later than 11:00 A.M.
(Charlotte, North Carolina time) on the Business Day
prior to the date of the requested borrowing in the case
of Base Rate Loans, and on the third Business Day prior
to the date of the requested borrowing in the case of
Eurodollar Loans. Each such request for borrowing shall
be irrevocable and shall specify (A) that a Revolving
Loan is requested, (B) the date of the requested
borrowing (which shall be a Business Day), (C) the
aggregate principal amount to be borrowed, and (D)
whether the borrowing shall be comprised of Base Rate
Loans, Eurodollar Loans or a combination thereof, and if
Eurodollar Loans are requested, the Interest Period(s)
therefor. If the Borrower shall fail to specify in any
such Notice of Borrowing (I) an applicable Interest
Period in the case of a Eurodollar Loan, then such notice
shall be deemed to be a request for an Interest Period of
one month, or (II) the type of Revolving Loan requested,
then such notice shall be deemed to be a request for a
Base Rate Loan hereunder. The Administrative Agent shall
give notice to each affected Lender promptly upon receipt
of each Notice of Borrowing pursuant to this Section
2.1(b)(i), the contents thereof and each such Lender's
share of any borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Eurodollar Loan or Base
Rate Loan that is a Revolving Loan shall be in a minimum
aggregate principal amount of $5,000,000 and integral
multiples of $1,000,000 in excess thereof (or the
remaining amount of the Revolving Committed Amount, if
less).
(iii) Advances. Each Lender will make its
Revolving Commitment Percentage of each Revolving Loan
borrowing available to the Administrative Agent for the
account of the Borrower as specified in Section 3.15(a),
or in such other manner as the Administrative Agent may
specify in writing, by 1:00 P.M. (Charlotte, North
Carolina time) on the date specified in the applicable
Notice of Borrowing in Dollars and in funds immediately
available to the Administrative Agent. Such borrowing
will then be made available to the Borrower by the
Administrative Agent by crediting the account of the
Borrower on the books of such office with the aggregate
of the amounts made available to the Administrative Agent
by the Lenders and in like funds as received by the
Administrative Agent.
(c) Repayment. The principal amount of all Revolving
Loans shall be due and payable in full on the Maturity Date,
unless accelerated sooner pursuant to Section 9.2.
(d) Interest. Subject to the provisions of Section 3.1,
(i) Base Rate Loans. During such periods as
Revolving Loans shall be comprised in whole or in part of
Base Rate Loans, such Base Rate Loans shall bear interest
at a per annum rate equal to the Adjusted Base Rate.
(ii) Eurodollar Loans. During such periods as
Revolving Loans shall be comprised in whole or in part of
Eurodollar Loans, such Eurodollar Loans shall bear
interest at a per annum rate equal to the Adjusted
Eurodollar Rate.
Interest on Revolving Loans shall be payable in arrears on
each applicable Interest Payment Date (or at such other
times as may be specified herein).
(e) Revolving Notes. The Revolving Loans made by each
Lender shall be evidenced by a duly executed promissory note
of the Borrower to such Lender in an original principal
amount equal to such Lender's Revolving Commitment
Percentage of the Revolving Committed Amount and in
substantially the form of Exhibit 2.1(e).
2.2 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof
and of the LOC Documents, if any, and any other terms and
conditions which the Issuing Lender may reasonably require
and in reliance upon the representations and warranties set
forth herein, an Issuing Lender shall from time to time upon
request issue (from the Closing Date to the Maturity Date
and in a form reasonably acceptable to such Issuing Lender),
in Dollars, and the Lenders shall participate in, letters of
credit (the "Letters of Credit") for the account of the
Borrower; provided, however, that the aggregate amount of
LOC Obligations shall not at any time exceed TWENTY-FIVE
MILLION DOLLARS ($25,000,000); provided, further, (i) the
sum of the aggregate amount of LOC Obligations outstanding
plus Revolving Loans outstanding plus Swingline Loans
outstanding shall not exceed the lesser of (A) the Revolving
Committed Amount and (B) the Borrowing Base and (ii) with
respect to each individual Lender, the Lender's pro rata
share of outstanding Revolving Loans plus its pro rata share
of outstanding LOC Obligations plus its pro rata share of
outstanding Swingline Loans shall not exceed such Lender's
Revolving Commitment Percentage of the Revolving Committed
Amount. The issuance and expiry date of each Letter of
Credit shall be a Business Day. Except as otherwise
expressly agreed upon by all the Lenders, no Letter of
Credit shall have an original expiry date more than one year
from the date of issuance, or as extended, shall have an
expiry date extending beyond the Maturity Date. Each Letter
of Credit shall be either (x) a standby letter of credit
issued to support the obligations (including pension or
insurance obligations), contingent or otherwise, of the
Borrower or any of its Subsidiaries, or (y) a commercial
letter of credit in respect of the purchase of goods or
services by the Borrower or any of its Subsidiaries in the
ordinary course of business. Each Letter of Credit shall
comply with the related LOC Documents.
(b) Notice and Reports. The request for the issuance of
a Letter of Credit shall be submitted to an Issuing Lender
at least three Business Days prior to the requested date of
issuance. Each Issuing Lender will, at least quarterly and
more frequently upon request, provide to the Administrative
Agent for dissemination to the Lenders a detailed report
specifying the Letters of Credit which are then issued and
outstanding and any activity with respect thereto which may
have occurred since the date of the prior report, and
including therein, among other things, the account party,
the beneficiary, the face amount, and the expiry date as
well as any payments or expirations which may have occurred.
Each Issuing Lender will further provide to the
Administrative Agent, promptly upon request, copies of the
Letters of Credit and the other LOC Documents.
(c) Participations. Each Lender, upon issuance of a
Letter of Credit (or, in the case of each Existing Letter of
Credit, on the Closing Date), shall be deemed to have
purchased without recourse a risk participation from the
applicable Issuing Lender in such Letter of Credit and each
LOC Document related thereto and the rights and obligations
arising thereunder and any collateral relating thereto, in
each case in an amount equal to its Revolving Commitment
Percentage of the obligations under such Letter of Credit,
and shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and be
obligated to pay to such Issuing Lender therefor and
discharge when due, its Revolving Commitment Percentage of
the obligations arising under such Letter of Credit.
Without limiting the scope and nature of each Lender's
participation in any Letter of Credit, to the extent that
such Issuing Lender has not been reimbursed as required
hereunder or under any such Letter of Credit, each such
Lender shall pay to such Issuing Lender its Revolving
Commitment Percentage of such unreimbursed drawing in same
day funds on the day of notification by such Issuing Lender
of an unreimbursed drawing pursuant to the provisions of
subsection (d) hereof. The obligation of each Lender to so
reimburse each Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of
a Default, an Event of Default or any other occurrence or
event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrower or any other
Credit Party to reimburse an Issuing Lender under any Letter
of Credit, together with interest as hereinafter provided.
Each Existing Letter of Credit shall be deemed for all
purposes of this Credit Agreement and the other Credit
Documents to be a Letter of Credit.
(d) Reimbursement. In the event of any drawing under
any Letter of Credit, the applicable Issuing Lender will
promptly notify the Borrower. Unless the Borrower shall
immediately notify such Issuing Lender of its intent to
otherwise reimburse such Issuing Lender, the Borrower shall
be deemed to have requested a Revolving Loan at the Adjusted
Base Rate in the amount of the drawing as provided in
subsection (e) hereof, the proceeds of which will be used to
satisfy the reimbursement obligations. The Borrower shall
reimburse the applicable Issuing Lender on the day of
drawing under any Letter of Credit either with the proceeds
of a Revolving Loan obtained hereunder or otherwise in same
day funds as provided herein or in the LOC Documents. If
the Borrower shall fail to reimburse an Issuing Lender as
provided hereinabove (including, without limitation, as a
result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower or any other
Credit Party), the unreimbursed amount of such drawing shall
bear interest at a per annum rate equal to the Adjusted Base
Rate plus two percent (2%). The Borrower's reimbursement
obligations hereunder shall be absolute and unconditional
under all circumstances irrespective of (but without waiver
of) any rights of set-off, counterclaim or defense to
payment the applicable account party or the Borrower may
claim or have against an Issuing Lender, the Administrative
Agent, the Collateral Agent, the Lenders, the beneficiary of
the Letter of Credit drawn upon or any other Person,
including without limitation, any defense based on any
failure of the applicable account party, the Borrower or any
other Credit Party to receive consideration or the legality,
validity, regularity or unenforceability of the Letter of
Credit. Each Issuing Lender will promptly notify the
Lenders of the amount of any unreimbursed drawing and each
Lender shall promptly pay to the Administrative Agent for
the account of an Issuing Lender, in Dollars and in
immediately available funds, the amount of such Lender's
Revolving Commitment Percentage of such unreimbursed
drawing. Such payment shall be made on the day such notice
is received by such Lender from an Issuing Lender if such
notice is received at or before 2:00 p.m. (Charlotte, North
Carolina time), otherwise such payment shall be made at or
before 12:00 Noon (Charlotte, North Carolina time) on the
Business Day next succeeding the day such notice is
received. If such Lender does not pay such amount to an
Issuing Lender in full upon such request, such Lender shall,
on demand, pay to the Administrative Agent for the account
of such Issuing Lender interest on the unpaid amount during
the period from the date the Lender received the notice
regarding the unreimbursed drawing until such Lender pays
such amount to such Issuing Lender in full at a rate per
annum equal to, if paid within two Business Days of the date
of drawing, the Federal Funds Rate and thereafter at a rate
equal to the Base Rate. Each Lender's obligation to make
such payment to an Issuing Lender, and the right of an
Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this
Credit Agreement or the Commitments hereunder, the existence
of a Default or Event of Default or the acceleration of the
obligations hereunder and shall be made without any offset,
abatement, withholding or reduction whatsoever.
Simultaneously with the making of each such payment by a
Lender to an Issuing Lender, such Lender shall,
automatically and without any further action on the part of
an Issuing Lender or such Lender, acquire a participation in
an amount equal to such payment (excluding the portion of
such payment constituting interest owing to an Issuing
Lender) in the related unreimbursed drawing portion of the
LOC Obligation and in the interest thereon and in the
related LOC Documents, and shall have a claim against the
Borrower and the other Credit Parties with respect thereto.
(e) Repayment with Revolving Loans. On any day on which
the Borrower shall have requested, or been deemed to have
requested, a Revolving Loan borrowing to reimburse a drawing
under a Letter of Credit, the Administrative Agent shall
give notice to the applicable Lenders that a Revolving Loan
has been requested or deemed requested in connection with a
drawing under a Letter of Credit, in which case a Revolving
Loan borrowing comprised solely of Base Rate Loans (each
such borrowing, a "Mandatory Borrowing") shall be
immediately made from all applicable Lenders (without giving
effect to any termination of the Commitments pursuant to
Section 9.2) pro rata based on each Lender's respective
Revolving Commitment Percentage and the proceeds thereof
shall be paid directly to the applicable Issuing Lender for
application to the respective LOC Obligations. Each such
Lender hereby irrevocably agrees to make such Revolving
Loans immediately upon any such request or deemed request on
account of each such Mandatory Borrowing in the amount and
in the manner specified in the preceding sentence and on the
same such date notwithstanding (i) the amount of Mandatory
Borrowing may not comply with the minimum amount for
borrowings of Revolving Loans otherwise required hereunder,
(ii) whether any conditions specified in Section 5 are then
satisfied, (iii) whether a Default or Event of Default then
exists, (iv) failure of any such request or deemed request
for Revolving Loans to be made by the time otherwise
required hereunder, (v) the date of such Mandatory
Borrowing, or (vi) any reduction in the Revolving Committed
Amount or any termination of the Commitments. In the event
that any Mandatory Borrowing cannot for any reason be made
on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding
under the Bankruptcy Code with respect to the Borrower or
any other Credit Party), then each such Lender hereby agrees
that it shall forthwith fund (as of the date the Mandatory
Borrowing would otherwise have occurred, but adjusted for
any payments received from the Borrower on or after such
date and prior to such purchase) its Participation Interest
in the outstanding LOC Obligations; provided, further, that
in the event any Lender shall fail to fund its Participation
Interest on the day the Mandatory Borrowing would otherwise
have occurred, then the amount of such Lender's unfunded
Participation Interest therein shall bear interest payable
to the applicable Issuing Lender upon demand, at the rate
equal to, if paid within two Business Days of such date, the
Federal Funds Rate, and thereafter at a rate equal to the
Base Rate.
(f) Modification and Extension. The issuance of any
supplement, modification, amendment, renewal, or extensions
to any Letter of Credit shall, for purposes hereof, be
treated in all respects the same as the issuance of a new
Letter of Credit hereunder.
(g) Uniform Customs and Practices. An Issuing Lender
may have the Letters of Credit be subject to The Uniform
Customs and Practice for Documentary Credits, as published
as of the date of issue by the International Chamber of
Commerce (Publication No. 500 or the most recent
publication, the "UCP"), in which case the UCP may be
incorporated therein and deemed in all respects to be a part
thereof.
(h) Responsibility of Issuing Lenders. It is expressly
understood and agreed as between the Lenders that the
obligations of the Issuing Lenders hereunder to the Lenders
are only those expressly set forth in this Credit Agreement
and that the Issuing Lenders shall be entitled to assume
that the conditions precedent set forth in Section 5 have
been satisfied unless it shall have acquired actual
knowledge that any such condition precedent has not been
satisfied; provided, however, that nothing set forth in this
Section 2.2 shall be deemed to prejudice the right of any
Lender to recover from an Issuing Lender any amounts made
available by such Lender to the an Issuing Lender pursuant
to this Section 2.2 in the event that it is determined by a
court of competent jurisdiction that the payment with
respect to a Letter of Credit constituted gross negligence
or willful misconduct on the part of such Issuing Lender.
(i) Conflict with LOC Documents. In the event of any
conflict between this Credit Agreement and any LOC Document,
this Credit Agreement shall govern.
(j) Indemnification of Issuing Lenders.
(i) In addition to its other obligations under
this Credit Agreement, the Borrower hereby agrees to
protect, indemnify, pay and save the Issuing Lenders
harmless from and against any and all claims, demands,
liabilities, damages, losses, reasonable costs, charges
and reasonable expenses (including reasonable attorneys'
fees) that the Issuing Lenders may incur or be subject to
as a consequence, direct or indirect, of (A) the issuance
of any Letter of Credit or (B) the failure of an Issuing
Lender to honor a drawing under a Letter of Credit as a
result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto
government or governmental authority (all such acts or
omissions, herein called "Government Acts").
(ii) As between the Borrower and an Issuing
Lender, the Borrower shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the
beneficiary thereof. An Issuing Lender shall not be
responsible for (except in the case of (A), (B) and (C)
below if such Issuing Lender has actual knowledge to the
contrary): (A) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application
for and issuance of any Letter of Credit, even if it
should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged;
(B) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or
assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, that
may prove to be invalid or ineffective for any reason;
(C) failure of the beneficiary of a Letter of Credit to
comply fully with conditions required in order to draw
upon a Letter of Credit; (D) errors, omissions,
interruptions or delays in transmission or delivery of
any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (E) errors
in interpretation of technical terms; (F) any loss or
delay in the transmission or otherwise of any document
required in order to make a drawing under a Letter of
Credit or of the proceeds thereof; and (G) any
consequences arising from causes reasonably beyond the
reasonable control of an Issuing Lender, including,
without limitation, any Government Acts. None of the
above shall affect, impair, or prevent the vesting of an
Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not
in limitation of the specific provisions hereinabove set
forth, any action taken or omitted by an Issuing Lender,
under or in connection with any Letter of Credit or the
related certificates, if taken or omitted in good faith,
shall not put an Issuing Lender under any resulting
liability to the Borrower or any other Credit Party. It
is the intention of the parties that this Credit
Agreement shall be construed and applied to protect and
indemnify the Issuing Lenders against any and all risks
involved in the issuance of the Letters of Credit, all of
which risks are hereby assumed by the Borrower,
including, without limitation, any and all risks of the
acts or omissions, whether rightful or wrongful, of any
present or future Government Acts. An Issuing Lender
shall not, in any way, be liable for any failure by such
Issuing Lender or anyone else to pay any drawing under
any Letter of Credit as a result of any Government Acts
or any other cause beyond the reasonable control of such
Issuing Lender.
(iv) Nothing in this subsection (j) is intended
to limit the reimbursement obligation of the Borrower
contained in this Section 2.2. The obligations of the
Borrower under this subsection (j) shall survive the
termination of this Credit Agreement. No act or omission
of any current or prior beneficiary of a Letter of Credit
shall in any way affect or impair the rights of an
Issuing Lender to enforce any right, power or benefit
under this Credit Agreement.
(v) Notwithstanding anything to the contrary
contained in this subsection (j), the Borrower shall have
no obligation to indemnify the Issuing Lenders in respect
of any liability incurred by an Issuing Lender arising
primarily out of the gross negligence or willful
misconduct of an Issuing Lender, as determined by a court
of competent jurisdiction. Nothing in this Agreement
shall relieve an Issuing Lender of any liability to the
Borrower in respect of any action taken by such Issuing
Lender which action constitutes gross negligence or
willful misconduct of such Issuing Lender or a violation
of the UCP or Uniform Commercial Code (as applicable), as
determined by a court of competent jurisdiction.
(k) Designation of Consolidated Parties as Account
Parties. Notwithstanding anything to the contrary set forth
in this Credit Agreement, including without limitation
Section 2.2(a), a Letter of Credit issued hereunder may
contain a statement to the effect that such Letter of Credit
is issued for the account of a Consolidated Party other than
the Borrower, provided that notwithstanding such statement,
the Borrower shall be the actual account party for all
purposes of this Credit Agreement for such Letter of Credit
and such statement shall not affect the Borrower's
reimbursement obligations hereunder with respect to such
Letter of Credit.
2.3 Swingline Loan Subfacility.
(a) Swingline Commitment. Subject to the terms and
conditions hereof and in reliance upon the representations
and warranties set forth herein, the Swingline Lender, in
its individual capacity, agrees to make certain revolving
credit loans requested by the Borrower in Dollars to the
Borrower (each a "Swingline Loan" and, collectively, the
"Swingline Loans") from time to time from the Closing Date
until the Maturity Date for the purposes hereinafter set
forth; provided, however, the aggregate principal amount of
Swingline Loans outstanding at any time shall not exceed TEN
MILLION DOLLARS ($10,000,000) (the "Swingline Committed
Amount"); provided, further, the aggregate principal amount
of outstanding Revolving Loans plus the aggregate principal
amount of outstanding Swingline Loans plus LOC Obligations
outstanding shall not exceed the lesser of (i) the Revolving
Committed Amount and (ii) the Borrowing Base. Swingline
Loans hereunder shall be made as Base Rate Loans or Quoted
Rate Swingline Loans as the Borrower may request in
accordance with the provisions of this Section 2.3, and may
be repaid and reborrowed in accordance with the provisions
hereof.
(b) Swingline Loan Advances.
(i) Notices; Disbursement. Whenever the
Borrower desires a Swingline Loan advance hereunder it
shall give written notice (or telephonic notice promptly
confirmed in writing) to the Swingline Lender not later
than 11:00 A.M. (Charlotte, North Carolina time) on the
Business Day of the requested Swingline Loan advance.
Each such notice shall be irrevocable and shall specify
(A) that a Swingline Loan advance is requested, (B) the
date of the requested Swingline Loan advance (which shall
be a Business Day) and (C) the principal amount of the
Swingline Loan advance requested. Each Swingline Loan
shall be made as a Base Rate Loan or a Quoted Rate
Swingline Loan and shall have such maturity date as the
Swingline Lender and the Borrower shall agree upon
receipt by the Swingline Lender of any such notice from
the Borrower. The Swingline Lender shall initiate the
transfer of funds representing the Swingline Loan advance
to the Borrower by 3:00 P.M. (Charlotte, North Carolina
time) on the Business Day of the requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan shall
be in a minimum principal amount mutually acceptable to
the Swingline Lender and the Borrower.
(iii) Repayment of Swingline Loans. The
principal amount of all Swingline Loans shall be due and
payable on the earlier of (A) the maturity date agreed to
by the Swingline Lender and the Borrower with respect to
such Loan (which maturity date shall not be a date more
than seven (7) Business Days from the date of advance
thereof) or (B) the Maturity Date. The Swingline Lender
may, at any time, in its sole discretion, by written
notice to the Borrower and the Lenders, demand repayment
of its Swingline Loans by way of a Revolving Loan
advance, in which case the Borrower shall be deemed to
have requested a Revolving Loan advance comprised solely
of Base Rate Loans in the amount of such Swingline Loans;
provided, however, that any such demand shall be deemed
to have been given one Business Day prior to the Maturity
Date and on the date of the occurrence of any Event of
Default described in Section 9.1 and upon acceleration of
the indebtedness hereunder and the exercise of remedies
in accordance with the provisions of Section 9.2. Each
Lender hereby irrevocably agrees to make its pro rata
share of each such Revolving Loan in the amount, in the
manner and on the date specified in the preceding
sentence notwithstanding (I) the amount of such borrowing
may not comply with the minimum amount for advances of
Revolving Loans otherwise required hereunder, (II)
whether any conditions specified in Section 5.2 are then
satisfied, (III) whether a Default or an Event of Default
then exists, (IV) failure of any such request or deemed
request for Revolving Loan to be made by the time
otherwise required hereunder, (V) whether the date of
such borrowing is a date on which Revolving Loans are
otherwise permitted to be made hereunder or (VI) any
termination of the Commitments relating thereto
immediately prior to or contemporaneously with such
borrowing. In the event that any Revolving Loan cannot
for any reason be made on the date otherwise required
above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code
with respect to the Borrower or any other Credit Party),
then each Lender hereby agrees that it shall forthwith
purchase (as of the date such borrowing would otherwise
have occurred, but adjusted for any payments received
from the Borrower on or after such date and prior to such
purchase) from the Swingline Lender such Participations
Interest in the outstanding Swingline Loans as shall be
necessary to cause each such Lender to share in such
Swingline Loans ratably based upon its Commitment
Percentage of the Revolving Committed Amount (determined
before giving effect to any termination of the
Commitments pursuant to Section 3.4).
(c) Interest on Swingline Loans.
(i) Subject to the provisions of Section 3.1,
each Swingline Loan shall bear interest at a per annum
rate equal to such rate as may be quoted by the Swingline
Lender to the Borrower in the sole discretion of the
Swingline Lender and accepted by the Borrower at or
promptly following the time of such quote as follows:
(A) Base Rate Loans. If such
Swingline Loan is a Base Rate Loan, at a per annum
rate (computed on the basis of the actual number of
days elapsed over a year of 365 days) equal to the
Adjusted Base Rate.
(B) Quoted Rate Swingline Loans. If
such Swingline Loan is a Quoted Rate Swingline Loan,
at a per annum rate (computed on the basis of the
actual number of days elapsed over a year of 360
days) equal to the Quoted Rate applicable thereto.
Notwithstanding any other provision to the contrary
set forth in this Credit Agreement, in the event that the
principal amount of any Quoted Rate Swingline Loan is not
repaid on the last day of the Interest Period for such
Loan, then such Loan shall be automatically converted
into a Base Rate Loan at the end of such Interest Period.
(ii) Payment of Interest. Interest on
Swingline Loans shall be payable in arrears on each
applicable Interest Payment Date (or at such other times
as may be specified herein), unless accelerated sooner
pursuant to Section 9.2.
(d) Swingline Note. The Swingline Loans shall be
evidenced by a duly executed promissory note of the Borrower
to the Swingline Lender in an original principal amount
equal to the Swingline Committed Amount substantially in the
form of Exhibit 2.3(d).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 Default Rate.
Upon the occurrence, and during the continuance, of an Event
of Default, the principal of and, to the extent permitted by
law, interest on the Loans and any other amounts owing
hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum rate 2% greater
than the rate which would otherwise be applicable (or if no
rate is applicable, whether in respect of interest, fees or
other amounts, then the Adjusted Base Rate plus 2%).
3.2 Extension and Conversion.
Subject to the terms of Section 5.2, the Borrower shall have
the option, on any Business Day, to extend existing
Revolving Loans into a subsequent permissible Interest
Period or to convert Revolving Loans into Revolving Loans of
another interest rate type; provided, however, that (i)
except as provided in Section 3.8, Eurodollar Loans may be
converted into Base Rate Loans only on the last day of the
Interest Period applicable thereto, (ii) Eurodollar Loans
may be extended, and Base Rate Loans may be converted into
Eurodollar Loans, only if no Default or Event of Default is
in existence on the date of extension or conversion, (iii)
Revolving Loans extended as, or converted into, Eurodollar
Loans shall be subject to the terms of the definition of
"Interest Period" set forth in Section 1.1 and shall be in
such minimum amounts as provided in, with respect to
Revolving Loans, Section 2.1(b)(ii), (iv) no more than 5
Eurodollar Loans shall be outstanding hereunder at any time
(it being understood that, for purposes hereof, Eurodollar
Loans with different Interest Periods shall be considered as
separate Eurodollar Loans, even if they begin on the same
date, although borrowings, extensions and conversions may,
in accordance with the provisions hereof, be combined at the
end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period), (v) any
request for extension or conversion of a Eurodollar Loan
which shall fail to specify an Interest Period shall be
deemed to be a request for an Interest Period of one month
and (vi) Swingline Loans may not be extended or converted
pursuant to this Section 3.2. Each such extension or
conversion shall be effected by the Borrower by giving a
Notice of Extension/Conversion (or telephonic notice
promptly confirmed in writing) to the office of the
Administrative Agent specified in specified in Schedule
2.1(a), or at such other office as the Administrative Agent
may designate in writing, prior to 11:00 A.M. (Charlotte,
North Carolina time) on the Business Day prior to, in the
case of the conversion of a Eurodollar Loan into a Base Rate
Loan, and on the third Business Day prior to, in the case of
the extension of a Eurodollar Loan as, or conversion of a
Base Rate Loan into, a Eurodollar Loan, the date of the
proposed extension or conversion, specifying the date of the
proposed extension or conversion, the Revolving Loans to be
so extended or converted, the types of Loans into which such
Revolving Loans are to be converted and, if appropriate, the
applicable Interest Periods with respect thereto. Each
request for extension or conversion shall be irrevocable and
shall constitute a representation and warranty by the
Borrower of the matters specified in subsections (b), (c),
(d), (e) and (f) of Section 5.2. In the event the Borrower
fails to request extension or conversion of any Eurodollar
Loan in accordance with this Section, or any such conversion
or extension is not permitted or required by this Section,
then such Eurodollar Loan shall be automatically converted
into a Base Rate Loan at the end of the Interest Period
applicable thereto. The Administrative Agent shall give
each Lender notice as promptly as practicable of any such
proposed extension or conversion affecting any Revolving
Loan.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the
right to prepay Loans in whole or in part from time to time,
but otherwise without premium or penalty. Subject to the
foregoing terms, amounts prepaid under this Section 3.3(a)
shall be applied as the Borrower may elect; provided that if
the Borrower fails to specify a voluntary prepayment then
such prepayment shall be applied first to Swingline Loans
(first to Base Rate Loans and then to Quoted Rate Swingline
Loans in direct order of Interest Period maturities) and
then to Revolving Loans (first to Base Rate Loans and then
to Eurodollar Loans in direct order of Interest Period
maturities).
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any
time, the sum of the aggregate principal amount of
outstanding Revolving Loans plus LOC Obligations
outstanding plus Swingline Loans outstanding shall exceed
the lesser of (A) the Revolving Committed Amount and (B)
the Borrowing Base, the Borrower immediately shall prepay
the Loans and (after all Revolving Loans and Swingline
Loans have been repaid) cash collateralize the LOC
Obligations, in an amount sufficient to eliminate such
excess.
(ii) Asset Dispositions. Immediately upon the
occurrence of any Asset Disposition Prepayment Event, the
Borrower shall prepay the Loans in an aggregate amount
equal to the Net Cash Proceeds of the related Asset
Disposition not applied (or caused to be applied) by the
Consolidated Parties during the related Application
Period to the purchase, acquisition or construction of
Eligible Assets as contemplated by the terms of Section
8.5 (such prepayment to be applied as set forth in clause
(v) below).
(iii) Debt Issuances. Immediately upon receipt
by any Consolidated Party of proceeds from any Debt
Issuance, the Borrower shall prepay the Loans in an
aggregate amount equal to 100% of the Net Cash Proceeds
of such Debt Issuance (such prepayment to be applied as
set forth in clause (v) below).
(iv) Issuances of Equity. Immediately upon
receipt by a Consolidated Party of proceeds from any
Equity Issuance other than an Excluded Equity Issuance,
the Borrower shall prepay the Revolving Loans in an
aggregate amount equal to 50% of the Net Cash Proceeds of
such Equity Issuance (such prepayment to be applied as
set forth in clause (v) below).
(v) Application of Mandatory Prepayments. All
amounts required to be paid pursuant to this Section
3.3(b) shall be applied first to Swingline Loans (first
to Base Rate Loans and then to Quoted Rate Swingline
Loans in direct order of Interest Period maturities) and
then to Revolving Loans (first to Base Rate Loans and
then to Eurodollar Loans in direct order of Interest
Period maturities) and (after all Loans have been repaid)
to a cash collateral account in respect of LOC
Obligations. All prepayments under this Section 3.3(b)
shall be subject to Section 3.12.
3.4 Termination and Reduction of Revolving Committed
Amount.
(a) Voluntary Reductions. The Borrower may from time to
time permanently reduce or terminate the Revolving Committed
Amount in whole or in part (in minimum aggregate amounts of
$5,000,000 or in integral multiples of $1,000,000 in excess
thereof (or, if less, the full remaining amount of the then
applicable Revolving Committed Amount)) upon five Business
Days' prior written notice to the Administrative Agent;
provided, however, no such termination or reduction shall be
made which would cause the aggregate principal amount of
outstanding Revolving Loans plus LOC Obligations outstanding
plus outstanding Swingline Loans to exceed the lesser of (A)
the Revolving Committed Amount and (B) the Borrowing Base,
unless, concurrently with such termination or reduction, the
Loans are repaid to the extent necessary to eliminate such
excess. The Administrative Agent shall promptly notify each
affected Lender of receipt by the Administrative Agent of
any notice from the Borrower pursuant to this Section
3.4(a).
(b) Mandatory Reductions. On any date that the Loans
are required to be prepaid pursuant to the terms of Section
3.3(b)(ii), (iii) or (iv), the Revolving Committed Amount
automatically shall be permanently reduced by the amount of
such required prepayment and/or reduction.
(c) Maturity Date. The Revolving Commitments of the
Lenders, the LOC Commitment of the Issuing Lenders and the
Swingline Commitment of the Swingline Lender shall
automatically terminate on the Maturity Date.
(d) General. The Borrower shall pay to the
Administrative Agent for the account of the Lenders in
accordance with the terms of Section 3.5(b), on the date of
each termination or reduction of the Revolving Committed
Amount, the Unused Fee accrued through the date of such
termination or reduction on the amount of the Revolving
Committed Amount so terminated or reduced.
3.5 Fees.
(a) Upfront Fees. The Borrower agrees to pay to the
Administrative Agent for the benefit of the Lenders in
immediately available funds on or before the Closing Date an
upfront fee (the "Upfront Fee") in the amount provided in
the Administrative Agents' Fee Letter.
(b) Unused Fee. In consideration of the Revolving
Commitments of the Lenders hereunder, the Borrower agrees to
pay to the Administrative Agent for the account of each
Lender a fee (the "Unused Fee") on the Unused Revolving
Committed Amount computed at a per annum rate for each day
during the applicable Unused Fee Calculation Period
(hereinafter defined) at a rate equal to the Applicable
Percentage for the Unused Fee in effect from time to time.
The Unused Fee shall commence to accrue on the Closing Date
and shall be due and payable in arrears on the last business
day of each March, June, September and December (and any
date that the Revolving Committed Amount is reduced as
provided in Section 3.4(a) and the Maturity Date) for the
immediately preceding quarter (or portion thereof) (each
such quarter or portion thereof for which the Unused Fee is
payable hereunder being herein referred to as an "Unused Fee
Calculation Period"), beginning with the first of such dates
to occur after the Closing Date.
(c) Letter of Credit Fees.
(i) Standby Letter of Credit Issuance Fee. In
consideration of the issuance of standby Letters of
Credit hereunder, the Borrower promises to pay to the
Administrative Agent for the account of each Lender a fee
(the "Standby Letter of Credit Fee") on such Lender's
Revolving Commitment Percentage of the average daily
maximum amount available to be drawn under each such
standby Letter of Credit computed at a per annum rate for
each day from the date of issuance to the date of
expiration equal to the Applicable Percentage for
Eurodollar Loans. The Standby Letter of Credit Fee will
be payable quarterly in arrears on the last Business Day
of each March, June, September and December for the
immediately preceding quarter (or a portion thereof).
(ii) Trade Letter of Credit Drawing Fee. In
consideration of the issuance of trade Letters of Credit
hereunder, the Borrower promises to pay to the
Administrative Agent for the account of each Lender a fee
(the "Trade Letter of Credit Fee") equal to the
Applicable Percentage for Eurodollar Loans on such
Lender's Revolving Commitment Percentage of the amount of
each drawing under any such trade Letter of Credit. The
Trade Letter of Credit Fee will be payable on each date
of drawing under a trade Letter of Credit.
(iii) Issuing Lender Fees. In addition to
the Standby Letter of Credit Fee payable pursuant to
clause (i) above and the Trade Letter of Credit Fee
payable pursuant to clause (ii) above, the Borrower
promises to pay to the applicable Issuing Lender for its
own account without sharing by the other Lenders the
letter of credit fronting and negotiation fees equal to
0.125% of such Issuing Lender's LOC Obligations and the
customary charges from time to time of such Issuing
Lender with respect to the issuance, amendment, transfer,
administration, cancellation and conversion of, and
drawings under, Letters of Credit issued by such Issuing
Lender (collectively, the "Issuing Lender Fees").
(d) Administrative Fees. The Borrower agrees to pay to
the Administrative Agent, for its own account (and for the
account of NationsBanc Capital Markets, Inc., as
applicable), to the Collateral Agent, for its own account
(and for the account of The Bank of New York, as
applicable), the fees referred to in the Agents' Fee Letter
(collectively, the "Agents' Fees").
3.6 Capital Adequacy.
If any Lender has determined, after the date hereof, that
the adoption or the becoming effective of, or any change in,
or any change by any Governmental Authority, central bank or
comparable agency charged with the interpretation or
administration thereof in the interpretation or
administration of, any applicable law, rule or regulation
regarding capital adequacy, or compliance by such Lender
with 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 such
Lender's capital or assets as a consequence of its
commitments or obligations hereunder to a level below that
which such Lender could have achieved but for such adoption,
effectiveness, change or compliance (taking into
consideration such Lender's policies with respect to capital
adequacy), then, upon notice from such Lender to the
Borrower, the Borrower shall be obligated to pay to such
Lender such additional amount or amounts as will compensate
such Lender for such reduction. Each determination by any
such Lender of amounts owing under this Section shall,
absent manifest error, be conclusive and binding on the
parties hereto.
3.7 Limitation on Eurodollar Loans.
If on or prior to the first day of any Interest Period for
any Eurodollar Loan:
(a) the Administrative Agent determines (which
determination shall be conclusive) that by reason of
circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period; or
(b) the Required Lenders determine (which determination
shall be conclusive) and notify the Administrative Agent
that the Eurodollar Rate will not adequately and fairly
reflect the cost to the Lenders of funding Eurodollar Loans
for such Interest Period;
then the Administrative Agent shall give the Borrower prompt
notice thereof, and so long as such condition remains in
effect, the Lenders shall be under no obligation to make
additional Eurodollar Loans, Continue Eurodollar Loans, or
to Convert Base Rate Loans into Eurodollar Loans and the
Borrower shall, on the last day(s) of the then current
Interest Period(s) for the outstanding Eurodollar Loans,
either prepay such Eurodollar Loans or Convert such
Eurodollar Loans into Base Rate Loans in accordance with the
terms of this Credit Agreement.
3.8 Illegality.
Notwithstanding any other provision of this Credit
Agreement, in the event that it becomes unlawful for any
Lender or its Applicable Lending Office to make, maintain,
or fund Eurodollar Loans hereunder, then such Lender shall
promptly notify the Borrower thereof and such Lender's
obligation to make or Continue Eurodollar Loans and to
Convert Base Rate Loans into Eurodollar Loans shall be
suspended until such time as such Lender may again make,
maintain, and fund Eurodollar Loans (in which case the
provisions of Section 3.10 shall be applicable).
3.9 Requirements of Law.
(a) If, after the date hereof, the adoption of any
applicable law, rule, or regulation, or any change in any
applicable law, rule, or regulation, or any change in the
interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with
the interpretation or administration thereof, or compliance
by any Lender (or its Applicable Lending Office) with any
request or directive (whether or not having the force of
law) of any such Governmental Authority, central bank, or
comparable agency:
(i)shall subject such Lender (or its Applicable
Lending Office) to any tax, duty, or other charge with
respect to any Eurodollar Loans, its Notes, or its
obligation to make Eurodollar Loans, or change the basis
of taxation of any amounts payable to such Lender (or its
Applicable Lending Office) under this Credit Agreement or
its Notes in respect of any Eurodollar Loans (other than
taxes imposed on the overall net income of such Lender by
the jurisdiction in which such Lender has its principal
office or such Applicable Lending Office);
(ii)shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar
requirement (other than the Eurodollar Reserve
Requirement utilized in the determination of the Adjusted
Eurodollar Rate) relating to any extensions of credit or
other assets of, or any deposits with or other
liabilities or commitments of, such Lender (or its
Applicable Lending Office), including the Commitment of
such Lender hereunder; or
(iii) shall impose on such Lender (or its
Applicable Lending Office) or on the United States market
for certificates of deposit or the London interbank
market any other condition affecting this Credit
Agreement or its Notes or any of such extensions of
credit or liabilities or commitments;
and the result of any of the foregoing is to increase the
cost to such Lender (or its Applicable Lending Office) of
making, Converting into, Continuing, or maintaining any
Eurodollar Loans or to reduce any sum received or receivable
by such Lender (or its Applicable Lending Office) under this
Credit Agreement or its Notes with respect to any Eurodollar
Loans, then the Borrower shall pay to such Lender on demand
such amount or amounts as will compensate such Lender for
such increased cost or reduction. If any Lender requests
compensation by the Borrower under this Section 3.9(a), the
Borrower may, by notice to such Lender (with a copy to the
Administrative Agent), suspend the obligation of such Lender
to make or Continue Eurodollar Loans, or to Convert Base
Rate Loans into Eurodollar Loans, until the event or
condition giving rise to such request ceases to be in effect
(in which case the provisions of Section 3.10 shall be
applicable); provided that such suspension shall not affect
the right of such Lender to receive the compensation so
requested.
(b) If, after the date hereof, any Lender shall have
determined that the adoption of any applicable law, rule, or
regulation regarding capital adequacy or any change therein
or in the interpretation or administration thereof by any
Governmental Authority, central bank, or comparable agency
charged with the interpretation or administration thereof,
or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such
Governmental Authority, central bank, or comparable agency,
has or would have the effect of reducing the rate of return
on the capital of such Lender or any corporation controlling
such Lender as a consequence of such Lender's obligations
hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption,
change, request, or directive (taking into consideration its
policies with respect to capital adequacy), then from time
to time upon demand the Borrower shall pay to such Lender
such additional amount or amounts as will compensate such
Lender for such reduction.
(c) Each Lender shall promptly notify the Borrower and
the Administrative Agent of any event of which it has
knowledge, occurring after the date hereof, which will
entitle such Lender to compensation pursuant to this Section
3.9 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 Lender, be otherwise disadvantageous to it. Any
Lender claiming compensation under this Section 3.9 shall
furnish to the Borrower and the Administrative Agent a
statement setting forth the additional amount or amounts to
be paid to it hereunder which shall be conclusive in the
absence of manifest error. In determining such amount, such
Lender may use any reasonable averaging and attribution
methods.
3.10 Treatment of Affected Loans.
If the obligation of any Lender to make any Eurodollar Loan
or to Continue, or to Convert Base Rate Loans into,
Eurodollar Loans shall be suspended pursuant to Section 3.8
or 3.9 hereof, such Lender's Eurodollar Loans shall be
automatically Converted into Base Rate Loans on the last
day(s) of the then current Interest Period(s) for such
Eurodollar Loans (or, in the case of a Conversion required
by Section 3.8 hereof, on such earlier date as such Lender
may specify to the Borrower with a copy to the
Administrative Agent) and, unless and until such Lender
gives notice as provided below that the circumstances
specified in Section 3.8 or 3.9 hereof that gave rise to
such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans
have been so Converted, all payments and prepayments of
principal that would otherwise be applied to such Lender's
Eurodollar Loans shall be applied instead to its Base Rate
Loans; and
(b) all Loans that would otherwise be made or Continued
by such Lender as Eurodollar Loans shall be made or
Continued instead as Base Rate Loans, and all Base Rate
Loans of such Lender that would otherwise be Converted into
Eurodollar Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to
the Administrative Agent) that the circumstances specified
in Section 3.8 or 3.9 hereof that gave rise to the
Conversion of such Lender's Eurodollar Loans pursuant to
this Section 3.10 no longer exist (which such Lender agrees
to do promptly upon such circumstances ceasing to exist) at
a time when Eurodollar Loans made by other Lenders are
outstanding, such Lender's Base Rate Loans shall be
automatically Converted, on the first day(s) of the next
succeeding Interest Period(s) for such outstanding
Eurodollar Loans, to the extent necessary so that, after
giving effect thereto, all Loans held by the Lenders holding
Eurodollar Loans and by such Lender are held pro rata (as to
principal amounts, interest rate basis, and Interest
Periods) in accordance with their respective Commitments.
3.11 Taxes.
(a) Any and all payments by the Borrower to or for the
account of any Lender or the Administrative Agent hereunder
or under any other Credit Document shall be made free and
clear of and without deduction for any and all present or
future taxes, duties, levies, imposts, deductions, charges
or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Lender and the Administrative
Agent, taxes imposed on its income, and franchise taxes
imposed on it, by the jurisdiction under the laws of which
such Lender (or its Applicable Lending Office) or the
Administrative Agent (as the case may be) is organized or
any political subdivision thereof (all such non-excluded
taxes, duties, levies, imposts, deductions, charges,
withholdings, and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable under
this Credit Agreement or any other Credit Document to any
Lender or the Administrative Agent, (i) the sum payable
shall be increased as necessary so that after making all
required deductions (including deductions applicable to
additional sums payable under this Section 3.11) such Lender
or the Administrative Agent receives an amount equal to the
sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, (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 furnish to the
Administrative Agent, at its address referred to in Section
11.1, the original or a certified copy of a receipt
evidencing payment thereof. Any Lender or Agent receiving
such increased amount shall immediately pay to the Borrower
the amount of any reduction or refund in the respective
Lender or Agent's Tax liability resulting from a credit or
deduction, as the case may be, of any Tax against the Lender
or Agent's Tax liability when the Lender or Agent realizes
such reduction or refund.
(b) In addition, the Borrower agrees to pay any and all
present or future stamp or documentary taxes and any other
excise or property taxes or charges or similar levies which
arise from any payment made under this Credit Agreement or
any other Credit Document or from the execution or delivery
of, or otherwise with respect to, this Credit Agreement or
any other Credit Document (hereinafter referred to as "Other
Taxes").
(c) The Borrower agrees to indemnify each Lender, the
Administrative Agent and the Collateral Agent for the full
amount of Taxes and Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed or asserted by
any jurisdiction on amounts payable under this Section 3.11)
paid by such Lender or the Administrative Agent (as the case
may be) and any liability (including penalties, interest,
and expenses) arising therefrom or with respect thereto.
(d) Each Lender organized under the laws of a
jurisdiction outside the United States, on or prior to the
date of its execution and delivery of this Credit
Agreement in the case of each Lender listed on the
signature pages hereof and on or prior to the date on
which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in
writing by the Borrower or the Administrative Agent (but
only so long as such Lender remains lawfully able to do
so), shall provide the Borrower and the Administrative
Agent with (i) Internal Revenue Service Form 1001 or 4224,
as appropriate, or any successor form prescribed by the
Internal Revenue Service, certifying that such Lender is
entitled to benefits under an income tax treaty to which
the United States is a party which reduces the rate of
withholding tax on payments of interest or certifying that
the income receivable pursuant to this Credit Agreement is
effectively connected with the conduct of a trade or
business in the United States, (ii) Internal Revenue
Service Form W-8 or W-9, as appropriate, or any successor
form prescribed by the Internal Revenue Service, and (iii)
any other form or certificate required by any taxing
authority (including any certificate required by Sections
871(h) and 881(c) of the Internal Revenue Code),
certifying that such Lender is entitled to an exemption
from or a reduced rate of tax on payments pursuant to this
Credit Agreement or any of the other Credit Documents.
(e) For any period with respect to which a Lender has
failed to provide the Borrower and the Administrative Agent
with the appropriate form pursuant to Section 3.11(d)
(unless such failure is due to a change in treaty, law, or
regulation occurring subsequent to the date on which a form
originally was required to be provided), such Lender shall
not be entitled to indemnification under Section 3.11(a) or
3.11(b) with respect to Taxes imposed by the United States;
provided, however, that should a Lender, which is otherwise
exempt from or subject to a reduced rate of withholding tax,
become subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower shall take such steps
as such Lender shall reasonably request to assist such
Lender to recover such Taxes.
(f) If the Borrower is required to pay additional
amounts to or for the account of any Lender pursuant to this
Section 3.11, then such Lender will agree to use reasonable
efforts to change the jurisdiction of its Applicable Lending
Office so as to eliminate or reduce any such additional
payment which may thereafter accrue if such change, in the
judgment of such Lender, is not otherwise disadvantageous to
such Lender.
(g) Within thirty (30) days after the date of any
payment of Taxes, the Borrower shall furnish to the
Administrative Agent the original or a certified copy of a
receipt evidencing such payment.
(h) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 3.11
shall survive the repayment of the Loans, LOC Obligations
and other obligations under the Credit Documents and the
termination of the Commitments hereunder.
3.12 Compensation.
Upon the request of any Lender, the Borrower shall pay to
such Lender such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss,
reasonable cost, or reasonable expense (including loss of
anticipated profits) incurred by it as a result of:
(a) any payment, prepayment, or Conversion of a
Eurodollar Loan or Quoted Rate Swingline Loan for any reason
(including, without limitation, the acceleration of the
Loans pursuant to Section 9.2) on a date other than the last
day of the Interest Period for such Loan; or
(b) any failure by the Borrower for any reason
(including, without limitation, the failure of any condition
precedent specified in Section 5 to be satisfied) to borrow,
Convert, Continue, or prepay a Eurodollar Loan or Quoted
Rate Swingline Loan on the date for such borrowing,
Conversion, Continuation, or prepayment specified in the
relevant notice of borrowing, prepayment, Continuation, or
Conversion under this Credit Agreement.
With respect to Eurodollar Loans, such indemnification may
include an amount equal to the excess, if any, of (a) the amount
of interest which would have accrued on the amount so prepaid, or
not so borrowed, converted or continued, for the period from the
date of such prepayment or of such failure to borrow, convert or
continue to the last day of the applicable Interest Period (or,
in the case of a failure to borrow, convert or continue, the
Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such
Eurodollar Loans provided for herein (excluding, however, the
Applicable Percentage included therein, if any) over (b) the
amount of interest (as reasonably determined by such Lender)
which would have accrued to such Lender on such amount by placing
such amount on deposit for a comparable period with leading banks
in the interbank Eurodollar market. The covenants of the
Borrower set forth in this Section 3.12 shall survive the
repayment of the Loans, LOC Obligations and other obligations
under the Credit Documents and the termination of the Commitments
hereunder.
3.13 Pro Rata Treatment.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or (subject to the
terms of Section 3.3) prepayment of principal of any Loan or
reimbursement obligations arising from drawings under
Letters of Credit, each payment of interest on the Loans or
reimbursement obligations arising from drawings under
Letters of Credit, each payment of Unused Fees, each payment
of the Standby Letter of Credit Fee, each payment of the
Trade Letter of Credit Fee, each reduction of the Revolving
Committed Amount and each conversion or extension of any
Loan, shall be allocated pro rata among the Lenders in
accordance with the respective principal amounts of their
outstanding Loans and Participation Interests.
Advances. No Lender shall be responsible for the
failure or delay by any other Lender in its obligation to
make its ratable share of a borrowing hereunder; provided,
however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of
its obligations hereunder. Unless the Administrative Agent
shall have been notified by any Lender prior to the date of
any requested borrowing that such Lender does not intend to
make available to the Administrative Agent its ratable share
of such borrowing to be made on such date, the
Administrative Agent may assume that such Lender has made
such amount available to the Administrative Agent on the
date of such borrowing, and the Administrative Agent in
reliance upon such assumption, may (in its sole discretion
but without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding
amount is not in fact made available to the Administrative
Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender
does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative
Agent will promptly notify the Borrower, and the Borrower
shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also
be entitled to recover from the Lender or the Borrower, as
the case may be, interest on such corresponding amount in
respect of each day from the date such corresponding amount
was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered
by the Administrative Agent at a per annum rate equal to (i)
from the Borrower at the applicable rate for the applicable
borrowing pursuant to the Notice of Borrowing and (ii) from
a Lender at the Federal Funds Rate.
3.14 Sharing of Payments.
The Lenders agree among themselves that, in the event that
any Lender shall obtain payment in respect of any Loan, LOC
Obligations or any other obligation owing to such Lender under
this Credit Agreement (but not including any payment received by
any Lender in its capacity as a Factor under a Factoring
Agreement) through the exercise of a right of setoff, banker's
lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other
security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other
means, in excess of its pro rata share of such payment as
provided for in this Credit Agreement, such Lender shall promptly
purchase from the other Lenders a Participation Interest in such
Loans, LOC Obligations and other obligations in such amounts, and
make such other adjustments from time to time, as shall be
equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for
in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender
through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared
the benefit of such payment shall, by repurchase of a
Participation Interest theretofore sold, return its share of that
benefit (together with its share of any accrued interest payable
with respect thereto) to each Lender whose payment shall have
been rescinded or otherwise restored. The Borrower agrees that
any Lender so purchasing such a Participation Interest may, to
the fullest extent permitted by law, exercise all rights of
payment, including setoff, banker's lien or counterclaim, with
respect to such Participation Interest as fully as if such Lender
were a holder of such Loan, LOC Obligations or other obligation
in the amount of such Participation Interest. Except as
otherwise expressly provided in this Credit Agreement, if any
Lender or the Administrative Agent shall fail to remit to the
Administrative Agent or any other Lender an amount payable by
such Lender or the Administrative Agent to the Administrative
Agent or such other Lender pursuant to this Credit Agreement on
the date when such amount is due, such payments shall be made
together with interest thereon for each date from the date such
amount is due until the date such amount is paid to the
Administrative Agent or such other Lender at a rate per annum
equal to the Federal Funds Rate. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives
a secured claim in lieu of a setoff to which this Section 3.14
applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.14
to share in the benefits of any recovery on such secured claim.
3.15 Payments, Computations, Etc.
(a) Except as otherwise specifically provided herein,
all payments hereunder shall be made to the Administrative
Agent in dollars in immediately available funds, without
offset, deduction, counterclaim or withholding of any kind,
at the Administrative Agent's office specified in Schedule
2.1(a) not later than 2:00 P.M. (Charlotte, North Carolina
time) on the date when due. Payments received after such
time shall be deemed to have been received on the next
succeeding Business Day. The Administrative Agent may (but
shall not be obligated to) debit the amount of any such
payment which is not made by such time to any ordinary
deposit account of the Borrower maintained with the
Administrative Agent or the Collateral Agent (with notice to
the Borrower). The Borrower shall, at the time it makes any
payment under this Credit Agreement, specify to the
Administrative Agent the Loans, LOC Obligations, Fees,
interest or other amounts payable by the Borrower hereunder
to which such payment is to be applied (and in the event
that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Administrative Agent
shall distribute such payment to the Lenders in such manner
as the Administrative Agent may determine to be appropriate
in respect of obligations owing by the Borrower hereunder,
subject to the terms of Section 3.13(a)). The
Administrative Agent will distribute such payments to such
Lenders, if any such payment is received prior to 12:00 Noon
(Charlotte, North Carolina time) on a Business Day in like
funds as received prior to the end of such Business Day and
otherwise the Administrative Agent will distribute such
payment to such Lenders on the next succeeding Business Day.
Whenever any payment hereunder shall be stated to be due on
a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day
(subject to accrual of interest and Fees for the period of
such extension), except that in the case of Eurodollar
Loans, if the extension would cause the payment to be made
in the next following calendar month, then such payment
shall instead be made on the next preceding Business Day.
Except as expressly provided otherwise herein, all
computations of interest and fees shall be made on the basis
of actual number of days elapsed over a year of 360 days,
except with respect to computation of interest on Base Rate
Loans which (unless the Base Rate is determined by reference
to the Federal Funds Rate) shall be calculated based on a
year of 365 or 366 days, as appropriate. Interest shall
accrue from and include the date of borrowing, but exclude
the date of payment.
(b) Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit
Agreement to the contrary, after the occurrence and during
the continuance of an Event of Default, all amounts
collected or received by the Administrative Agent, the
Collateral Agent or any Lender on account of the Credit
Party Obligations or any other amounts outstanding under any
of the Credit Documents or in respect of the Collateral
shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation reasonable
attorneys' fees) of the Administrative Agent and the
Collateral Agent in connection with enforcing the rights of
the Lenders under the Credit Documents and any protective
advances made by the Administrative Agent or the Collateral
Agent with respect to the Collateral under or pursuant to
the terms of the Collateral Documents;
SECOND, to payment of any fees owed to the
Administrative Agent or the Collateral Agent;
THIRD, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation, reasonable
attorneys' fees) of each of the Lenders in connection with
enforcing its rights under the Credit Documents or otherwise
with respect to the Credit Party Obligations owing to such
Lender;
FOURTH, to the payment of all of the Credit Party
Obligations consisting of accrued fees and interest;
FIFTH, to the payment of the outstanding principal
amount of the Credit Party Obligations (including the
payment or cash collateralization of the outstanding LOC
Obligations);
SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under
the Credit Documents or otherwise and not repaid pursuant to
clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be
applied in the numerical order provided until exhausted
prior to application to the next succeeding category; (ii)
each of the Lenders shall receive an amount equal to its pro
rata share (based on the proportion that the then
outstanding Loans and LOC Obligations held by such Lender
bears to the aggregate then outstanding Loans and LOC
Obligations) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and
(iii) to the extent that any amounts available for
distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding
Letters of Credit, such amounts shall be held by the
Administrative Agent or the Collateral Agent (as determined
by the Administrative Agent) in a cash collateral account
and applied (A) first, to reimburse the Issuing Lenders from
time to time on a pro rata basis for any drawings under such
Letters of Credit and (B) then, following the expiration of
all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner
provided in this Section 3.15(b).
3.16 Evidence of Debt.
(a) Each Lender shall maintain an account or accounts
evidencing each Loan made by such Lender to the Borrower
from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time
under this Credit Agreement. Each Lender will make
reasonable efforts to maintain the accuracy of its account
or accounts and to promptly update its account or accounts
from time to time, as necessary.
(b) The Administrative Agent shall maintain the
Register pursuant to Section 11.3(c), and a subaccount for
each Lender, in which Register and subaccounts (taken
together) shall be recorded (i) the amount, type and
Interest Period of each such Loan hereunder, (ii) the amount
of any principal or interest due and payable or to become
due and payable to each Lender hereunder and (iii) the
amount of any sum received by the Administrative Agent
hereunder from or for the account of the Borrower and each
Lender's share thereof. The Administrative Agent will make
reasonable efforts to maintain the accuracy of the
subaccounts referred to in the preceding sentence and to
promptly update such subaccounts from time to time, as
necessary.
(c) The entries made in the accounts, Register and
subaccounts maintained pursuant to subsection (b) of this
Section 3.16 (and, if consistent with the entries of the
Administrative Agent, subsection (a)) shall be prima facie
evidence of the existence and amounts of the obligations of
the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to
maintain any such account, such Register or such subaccount,
as applicable, or any error therein, shall not in any manner
affect the obligation of the Borrower to repay the Loans
made by such Lender in accordance with the terms hereof.
3.17 Mandatory Assignment.
In the event any Lender requests payment by the Borrower of
any additional amounts pursuant to Section 3.11, then, provided
that no Default or Event of Default has occurred and is
continuing at such time, the Borrower may, at its own expense
(such expense to include any transfer fee payable to the
Administrative Agent under Section 11.3(b)), and in its sole
discretion require such Lender to transfer and assign in whole or
in part, without recourse (in accordance with and subject to the
terms and conditions of Section 11.3(b)), all or part of its
interests, rights and obligations under the Credit Agreement to
an Eligible Assignee which shall assume such assigned
obligations, provided that (i) such assignment shall not conflict
with any law, rule or regulation or order of any court or other
Governmental Authority and (ii) the Borrower or such assignee
shall have paid to the assigning Lender in immediately available
funds the principal of and interest accrued to the date of such
payment on the Loans made by it under the Credit Agreement and
all other amounts owed to it under the Credit Agreement.
SECTION 4
GUARANTY
4.1 The Guaranty.
Each of the Guarantors hereby jointly and severally
guarantees to each Lender, the Administrative Agent and the
Collateral Agent as hereinafter provided the prompt payment of
the Credit Party Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) strictly in
accordance with the terms thereof. The Guarantors hereby further
agree that if any of the Credit Party Obligations are not paid in
full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), the Guarantors will, jointly and
severally, promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Credit Party Obligations, the
same will be promptly paid in full when due (whether at extended
maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) in accordance with
the terms of such extension or renewal.
Notwithstanding any provision to the contrary contained
herein or in any other of the Credit Documents, the obligations
of each Guarantor hereunder shall be limited to an aggregate
amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of
the Bankruptcy Code or any comparable provisions of any
applicable state law.
4.2 Obligations Unconditional.
The obligations of the Guarantors under Section 4.1 are
joint and several, absolute and unconditional, irrespective of
the value, genuineness, validity, regularity or enforceability of
any of the Credit Documents, or any other agreement or instrument
referred to therein, or any substitution, release, impairment or
exchange of any other guarantee of or security for any of the
Credit Party Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge
or defense of a surety or guarantor, it being the intent of this
Section 4.2 that the obligations of the Guarantors hereunder
shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall
have no right of subrogation, indemnity, reimbursement or
contribution against the Borrower or any other Guarantor of the
Credit Party Obligations for amounts paid under this Section 4
until such time as the Lenders have been paid in full, all
Commitments under this Credit Agreement have been terminated and
no Person or Governmental Authority shall have any right to
request any return or reimbursement of funds from the Lenders in
connection with monies received under the Credit Documents.
Without limiting the generality of the foregoing, it is agreed
that, to the fullest extent permitted by law, the occurrence of
any one or more of the following shall not alter or impair the
liability of any Guarantor hereunder which shall remain absolute
and unconditional as described above:
(a) at any time or from time to time, without notice
to any Guarantor, the time for any performance of or
compliance with any of the Credit Party Obligations shall be
extended, or such performance or compliance shall be waived;
(b) any of the acts mentioned in any of the provisions
of any of the Credit Documents or any other agreement or
instrument referred to in the Credit Documents shall be done
or omitted;
(c) the maturity of any of the Credit Party
Obligations shall be accelerated, or any of the Credit Party
Obligations shall be modified, supplemented or amended in
any respect, or any right under any of the Credit Documents
or any other agreement or instrument referred to in the
Credit Documents shall be waived or any other guarantee of
any of the Credit Party Obligations or any security therefor
shall be released, impaired or exchanged in whole or in part
or otherwise dealt with;
(d) any Lien granted to, or in favor of, the
Administrative Agent, the Collateral Agent or any Lender or
Lenders as security for any of the Credit Party Obligations
shall fail to attach or be perfected; or
(e) any of the Credit Party Obligations shall be
determined to be void or voidable (including, without
limitation, for the benefit of any creditor of any
Guarantor) or shall be subordinated to the claims of any
Person (including, without limitation, any creditor of any
Guarantor).
With respect to its obligations hereunder, each Guarantor hereby
expressly waives diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that the
Administrative Agent, the Collateral Agent or any Lender exhaust
any right, power or remedy or proceed against any Person under
any of the Credit Documents or any other agreement or instrument
referred to in the Credit Documents, or against any other Person
under any other guarantee of, or security for, any of the Credit
Party Obligations.
4.3 Reinstatement.
The obligations of the Guarantors under this Section 4 shall
be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of any Person in respect of
the Credit Party Obligations is rescinded or must be otherwise
restored by any holder of any of the Credit Party Obligations,
whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it
will indemnify the Administrative Agent, the Collateral Agent and
each Lender on demand for all reasonable costs and expenses
(including, without limitation, fees and expenses of counsel)
incurred by the Administrative Agent, the Collateral Agent or
such Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending
against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
4.4 Certain Additional Waivers.
Without limiting the generality of the provisions of this
Section 4, each Guarantor hereby specifically waives the benefits
of N.C. Gen. Stat. 26-7 through 26-9, inclusive, to the extent
applicable. Each Guarantor further agrees that such Guarantor
shall have no right of recourse to security for the Credit Party
Obligations, except through the exercise of rights of subrogation
pursuant to Section 4.2 and through the exercise of rights of
contribution pursuant to Section 4.6.
4.5 Remedies.
The Guarantors agree that, to the fullest extent permitted
by law, as between the Guarantors, on the one hand, and the
Administrative Agent, the Collateral Agent and the Lenders, on
the other hand, the Credit Party Obligations may be declared to
be forthwith due and payable as provided in Section 9.2 (and
shall be deemed to have become automatically due and payable in
the circumstances provided in said Section 9.2) for purposes of
Section 4.1 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or preventing the Credit
Party Obligations from becoming automatically due and payable) as
against any other Person and that, in the event of such
declaration (or the Credit Party Obligations being deemed to have
become automatically due and payable), the Credit Party
Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for
purposes of Section 4.1. The Guarantors acknowledge and agree
that their obligations hereunder are secured in accordance with
the terms of the Security Agreements and the other Collateral
Documents and that the Lenders may exercise their remedies
thereunder in accordance with the terms thereof.
4.6 Rights of Contribution.
The Guarantors hereby agree as among themselves that, if any
Guarantor shall make an Excess Payment (as defined below), such
Guarantor shall have a right of contribution from each other
Guarantor in an amount equal to such other Guarantor's
Contribution Share (as defined below) of such Excess Payment.
The payment obligations of any Guarantor under this Section 4.6
shall be subordinate and subject in right of payment to the prior
payment in full to the Administrative Agent, the Collateral Agent
and the Lenders of the Guaranteed Obligations, and none of the
Guarantors shall exercise any right or remedy under this Section
4.6 against any other Guarantor until payment and satisfaction in
full of all of such Guaranteed Obligations. For purposes of this
Section 4.6, (a) "Guaranteed Obligations" shall mean any
obligations arising under the other provisions of this Section 4;
(b) "Excess Payment" shall mean the amount paid by any Guarantor
in excess of its Pro Rata Share of any Guaranteed Obligations;
(c) "Pro Rata Share" shall mean, for any Guarantor in respect of
any payment of Guaranteed Obligations, the ratio (expressed as a
percentage) as of the date of such payment of Guaranteed
Obligations of (i) the amount by which the aggregate present fair
salable value of all of its assets and properties exceeds the
amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of such Guarantor
hereunder) to (ii) the amount by which the aggregate present fair
salable value of all assets and other properties of the Borrower
and all of the Guarantors exceeds the amount of all of the debts
and liabilities (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of
the Borrower and the Guarantors hereunder) of the Borrower and
all of the Guarantors; provided, however, that, for purposes of
calculating the Pro Rata Shares of the Guarantors in respect of
any payment of Guaranteed Obligations, any Guarantor that became
a Guarantor subsequent to the date of any such payment shall be
deemed to have been a Guarantor on the date of such payment and
the financial information for such Guarantor as of the date such
Guarantor became a Guarantor shall be utilized for such Guarantor
in connection with such payment; and (d) "Contribution Share"
shall mean, for any Guarantor in respect of any Excess Payment
made by any other Guarantor, the ratio (expressed as a
percentage) as of the date of such Excess Payment of (i) the
amount by which the aggregate present fair salable value of all
of its assets and properties exceeds the amount of all debts and
liabilities of such Guarantor (including contingent,
subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder) to (ii)
the amount by which the aggregate present fair salable value of
all assets and other properties of the Borrower and all of the
Guarantors other than the maker of such Excess Payment exceeds
the amount of all of the debts and liabilities (including
contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of the Borrower and
the Guarantors hereunder) of the Borrower and all of the
Guarantors other than the maker of such Excess Payment; provided,
however, that, for purposes of calculating the Contribution
Shares of the Guarantors in respect of any Excess Payment, any
Guarantor that became a Guarantor subsequent to the date of any
such Excess Payment shall be deemed to have been a Guarantor on
the date of such Excess Payment and the financial information for
such Guarantor as of the date such Guarantor became a Guarantor
shall be utilized for such Guarantor in connection with such
Excess Payment. This Section 4.6 shall not be deemed to affect
any right of subrogation, indemnity, reimbursement or
contribution that any Guarantor may have under applicable law
against the Borrower in respect of any payment of Guaranteed
Obligations. Notwithstanding the foregoing, all rights of
contribution against any Guarantor shall terminate from and after
such time, if ever, that such Guarantor shall be relieved of its
obligations pursuant to Section 8.4.
4.7 Continuing Guarantee.
The guarantee in this Section 4 is a continuing guarantee,
and shall apply to all Credit Party Obligations whenever arising.
SECTION 5
CONDITIONS
5.1 Closing Conditions.
The obligation of the Lenders (including the Swingline
Lender) to enter into this Credit Agreement and to make the
initial Loans or an Issuing Lender to issue the initial Letters
of Credit, whichever shall occur first, shall be subject to
satisfaction of the following conditions (in form and substance
acceptable to the Lenders):
(a) Executed Credit Documents. Receipt by the
Administrative Agent of duly executed copies of: (i) this
Credit Agreement; (ii) the Notes; (iii) the Collateral
Documents and (iv) all other Credit Documents, each in form
and substance acceptable to the Lenders in their sole
discretion.
(b) Corporate Documents. Receipt by the
Administrative Agent of the following:
(i) Charter Documents. Copies of the
articles or certificates of incorporation or other
charter documents of Alchem and each Credit Party
certified to be true and complete as of a recent date
by the appropriate Governmental Authority of the state
or other jurisdiction of its incorporation and
certified by a secretary or assistant secretary of such
Person to be true and correct as of the Closing Date.
(ii) Bylaws. A copy of the bylaws of Alchem
and each Credit Party certified by a secretary or
assistant secretary of such Person to be true and
correct as of the Closing Date.
(iii) Resolutions. Copies of resolutions
of the Board of Directors of Alchem and each Credit
Party approving and adopting the Credit Documents to
which it is a party, the transactions contemplated
therein and authorizing execution and delivery thereof,
certified by a secretary or assistant secretary of such
Person to be true and correct and in force and effect
as of the Closing Date.
(iv) Good Standing. Copies of (A)
certificates of good standing, existence or its
equivalent with respect to Alchem and each Credit Party
certified as of a recent date by the appropriate
Governmental Authorities of the state or other
jurisdiction of incorporation and each other
jurisdiction in which the failure to so qualify and be
in good standing could have a Material Adverse Effect
and (B) to the extent available, a certificate
indicating payment of all corporate franchise taxes
certified as of a recent date by the appropriate
governmental taxing authorities.
(v) Incumbency. An incumbency certificate
of Alchem and each Credit Party certified by a
secretary or assistant secretary to be true and correct
as of the Closing Date.
(c) Opinions of Counsel. The Administrative Agent
shall have received, in each case dated as of the Closing
Date:
(i) a legal opinion of Wyche, Burgess,
Xxxxxxx & Xxxxxx, P.A., general counsel for Alchem and
the Credit Parties, substantially in the form of
Schedule 5.1(c)(i);
(ii) a legal opinion of special local counsel
for each Credit Party not incorporated in the State of
South Carolina or Delaware, substantially in the form
of Schedule 5.1(c)(ii);
(iii) a legal opinion of special local
counsel for the Credit Parties for each State other
than South Carolina in which any material portion of
the Collateral (as determined by the Agent) is located,
substantially in the form of Schedule 5.1(c)(iii); and
(iv) a legal opinion of special foreign
counsel for the Credit Parties for each country in
which any Foreign Subsidiary whose Capital Stock is to
be pledged pursuant to the Pledge Agreement is
incorporated, substantially in the form of Schedule
5.1(c)(iv).
(d) Collateral. The Administrative Agent shall have
received:
(i) searches of Uniform Commercial Code
filings in the jurisdiction of the chief executive
office of each Credit Party and each jurisdiction where
any Collateral is located or where a filing would need
to be made in order to perfect the Collateral Agent's
security interest in the Collateral, copies of the
financing statements on file in such jurisdictions and
evidence that no Liens exist other than Permitted
Liens;
(ii) duly executed UCC financing statements
for each Credit Party for each appropriate jurisdiction
as is necessary, in the Administrative Agent's sole
discretion, to perfect the Collateral Agent's security
interest in the Collateral;
(iii) all stock certificates evidencing
the Capital Stock pledged to the Collateral Agent
pursuant to the Pledge Agreement, together with duly
executed in blank undated stock powers attached thereto
(unless, with respect to the pledged Capital Stock of
any Foreign Subsidiary, such stock powers are deemed
unnecessary by the Administrative Agent in its
reasonable discretion under the law of the jurisdiction
of incorporation of such Person);
(iv) in the case of any Collateral located at
a premises leased by a Credit Party, such estoppel
letters, consents and waivers from the landlords on
such real property as may be required by the
Administrative Agent;
(v) all instruments and chattel paper in the
possession of any of the Credit Parties, together with
allonges or assignments as may be necessary or
appropriate to perfect the Collateral Agent's security
interest in the Collateral;
(vi) an original, executed copy of an
assignment of factoring proceeds, consented to in
writing by the applicable Factor and otherwise in form
and substance satisfactory to the Administrative Agent,
for each Factoring Agreement existing as of the Closing
Date; and
(vii) all duly executed consents as are
necessary, in the Administrative Agent's sole
discretion, to perfect the Collateral Agent's security
interest in the Collateral.
(e) Priority of Liens. The Administrative Agent shall
have received satisfactory evidence that (i) the Collateral
Agent, on behalf of the Lenders, holds a perfected, first
priority Lien on all Collateral and (ii) none of the
Collateral is subject to any other Liens other than
Permitted Liens.
(f) Availability. The Administrative Agent shall be
satisfied that, after giving effect to the initial Loans
made and Letters of Credit issued hereunder on the Closing
Date, there shall be at least $25,000,000 of availability
existing under the Revolving Committed Amount.
(g) Opening Borrowing Base Report. Receipt by the
Administrative Agent of a Borrowing Base Certificate as of
the Closing Date substantially in the form of Exhibit 7.1(d)
and certified by the chief financial officer of the Borrower
to be true and correct as of the Closing Date.
(h) Evidence of Insurance. Receipt by the
Administrative Agent of copies of insurance policies or
certificates of insurance of the Consolidated Parties
evidencing liability and casualty insurance meeting the
requirements set forth in the Credit Documents, including,
but not limited to, naming the Collateral Agent as sole loss
payee on behalf of the Lenders.
(i) Senior Debt. (i) The Borrower shall have entered
into the Senior Note Indenture, (ii) the Borrower shall have
executed the Senior Notes, (iii) the Administrative Agent
shall have received a copy, certified by an officer of the
Borrower as true and complete, of the Senior Note Indenture
and each of the Senior Notes as originally executed and
delivered, and no amendment or modification thereof shall
have been entered into on or prior to the Closing Date which
shall not have been approved by each of the Lenders and (iv)
the Borrower shall have received proceeds from the sale of
Senior Notes in an aggregate principal amount of
$150,000,000.00.
(j) Closing of New Delta Woodside Credit Facility.
The closing of the New Delta Woodside Credit Facility shall
have occurred and all conditions precedent to the initial
extensions of credit thereunder shall have been satisfied.
(k) Material Adverse Change. No material adverse
change shall have occurred since June 28, 1997 in the
condition (financial or otherwise), business, management or
prospects of any Consolidated Party.
(l) Litigation. There shall not exist any pending or
threatened action, suit, investigation or proceeding against
a Consolidated Party that is reasonably likely to have a
Material Adverse Effect.
(m) Officer's Certificates. The Administrative Agent
shall have received a certificate or certificates executed
by an Executive Officer of the Borrower as of the Closing
Date stating that (A) each Consolidating Party is in
compliance with all existing financial obligations, (B) all
governmental, shareholder and third party consents and
approvals, if any, with respect to the Credit Documents and
the transactions contemplated thereby have been obtained,
(C) no action, suit, investigation or proceeding is pending
or threatened in any court or before any arbitrator or
governmental instrumentality that purports to affect any
Consolidating Party or any transaction contemplated by the
Credit Documents, if such action, suit, investigation or
proceeding could have a Material Adverse Effect and (D)
immediately after giving effect to this Credit Agreement,
the other Credit Documents and all the transactions
contemplated therein to occur on such date, (1) each of the
Credit Parties is Solvent, (2) no Default or Event of
Default exists, (3) all representations and warranties
contained herein and in the other Credit Documents are true
and correct in all material respects, and (4) the Credit
Parties are in compliance with each of the financial
covenants set forth in Section 7.11.
(n) Fees and Expenses. Payment by the Credit Parties
of all reasonable fees and expenses owed by them to the
Lenders, the Administrative Agent and the Collateral Agent,
including, without limitation, payment to the Administrative
Agent and the Collateral Agent of the fees set forth in the
Agents' Fee Letter.
(o) Payoff Letter. Receipt by the Administrative
Agent of a payoff letter in respect of the Existing Credit
Facility in form and substance satisfactory to the
Administrative Agent.
(p) Other. Receipt by the Lenders of such other
documents, instruments, agreements or information with
respect to the Consolidated Parties as reasonably requested
by any Lender.
5.2 Conditions to all Extensions of Credit.
The obligations of each Lender (including the Swingline
Lender) to make, convert or extend any Loan and of an Issuing
Lender to issue or extend any Letter of Credit (including the
initial Loans and the initial Letter of Credit) are subject to
satisfaction of the following conditions in addition to
satisfaction on the Closing Date of the conditions set forth in
Section 5.1:
(a) The Borrower shall have delivered (i) in the case
of any Revolving Loan an appropriate Notice of Borrowing or
Notice of Extension/Conversion or (ii) in the case of any
Letter of Credit, the applicable Issuing Lender shall have
received an appropriate request for issuance in accordance
with the provisions of Section 2.2(b);
(b) The representations and warranties set forth in
Section 6 shall, subject to the limitations set forth
therein, be true and correct in all material respects as of
such date (except for those which expressly relate to an
earlier date);
(c) There shall not have been commenced against Alchem
or any Credit Party an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter
in effect, or any case, proceeding or other action for the
appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of such Person
or for any substantial part of its Property or for the
winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action
shall remain undismissed, undischarged or unbonded;
(d) No Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto;
(e) No development or event which has had or could
have a Material Adverse Effect shall have occurred since
June 28, 1997; and
(f) Immediately after giving effect to the making of
such Loan (and the application of the proceeds thereof) or
to the issuance of such Letter of Credit, as the case may
be, (i) the sum of the aggregate principal amount of
outstanding Revolving Loans plus LOC Obligations outstanding
plus outstanding Swingline Loans shall not exceed the lesser
of (A) the Revolving Committed Amount and (B) the Borrowing
Base, and (ii) the LOC Obligations shall not exceed the LOC
Committed Amount.
The delivery of each Notice of Borrowing, each Notice of
Extension/Conversion and each request for a Letter of Credit
pursuant to Section 2.2(b) shall constitute a representation and
warranty by the Borrower of the correctness of the matters
specified in subsections (b), (c), (d), (e) and (f) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Administrative
Agent, the Collateral Agent and each Lender that:
6.1 Financial Condition.
(a) The consolidated and consolidating balance sheet
of the Consolidated Parties as of June 28, 1997 and the
consolidated and consolidating statements of earnings and
statements of cash flows for the years ended June 24, 1995
and June 29, 1996 have heretofore been furnished to each
Lender. Such financial statements (including the notes
thereto) (i) have been reviewed by KPMG Peat Marwick, (ii)
have been prepared in accordance with GAAP consistently
applied throughout the periods covered thereby and (iii)
present fairly (on the basis disclosed in the footnotes to
such financial statements) the consolidated and
consolidating financial condition, results of operations and
cash flows of the Consolidated Parties as of such date and
for such periods. During the period from June 28, 1997 to
and including the Closing Date, there has been no sale,
transfer or other disposition by any Consolidated Party of
any material part of the business or property of the
Consolidated Parties, taken as a whole, and no purchase or
other acquisition by any of them of any business or property
(including any capital stock of any other person) material
in relation to the consolidated financial condition of the
Consolidated Parties, taken as a whole, in each case, which
is not reflected in the foregoing financial statements or in
the notes thereto and has not otherwise been disclosed in
writing to the Lenders on or prior to the Closing Date.
(b) The financial statements delivered to the Lenders
pursuant to Section 7.1(a) and (b), (i) have been prepared
in accordance with GAAP (except as may otherwise be
permitted under Section 7.1(a) and (b)) and (ii) present
fairly (on the basis disclosed in the footnotes to such
financial statements) the consolidated and consolidating
financial condition, results of operations and cash flows of
the Consolidated Parties as of such date and for such
periods.
6.2 No Material Change.
Since June 28, 1997, (a) there has been no development or
event relating to or affecting a Consolidated Party which has had
or could have a Material Adverse Effect and (b) except as
otherwise permitted under this Credit Agreement, no dividends or
other distributions have been declared, paid or made upon the
Capital Stock in a Consolidated Party nor has any of the Capital
Stock in a Consolidated Party been redeemed, retired, purchased
or otherwise acquired for value.
6.3 Organization and Good Standing.
Each of the Consolidated Parties (a) is duly organized,
validly existing and is in good standing under the laws of the
jurisdiction of its incorporation or organization, (b) has the
corporate or other necessary power and authority, and the legal
right, to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is
currently engaged and (c) is duly qualified as a foreign entity
and in good standing under the laws of each jurisdiction where
its ownership, lease or operation of property or the conduct of
its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good
standing would not have a Material Adverse Effect.
6.4 Power; Authorization; Enforceable Obligations.
Each of Alchem and the Credit Parties has the corporate or
other necessary power and authority, and the legal right, to
make, deliver and perform the Credit Documents to which it is a
party, and in the case of the Borrower, to obtain extensions of
credit hereunder, and has taken all necessary corporate action to
authorize the borrowings and other extensions of credit on the
terms and conditions of this Credit Agreement and to authorize
the execution, delivery and performance of the Credit Documents
to which it is a party. As of the Closing Date, no consent or
authorization of, filing with, notice to or other similar act by
or in respect of, any Governmental Authority or any other Person
is required to be obtained or made by or on behalf of Alchem or
any Credit Party in connection with the borrowings or other
extensions of credit hereunder or with the execution, delivery,
performance, validity or enforceability of the Credit Documents
to which such Person is a party, except for (i) consents,
authorizations, notices and filings described in Schedule 6.4,
all of which have been obtained or made or have the status
described in such Schedule 6.4 and (ii) filings to perfect the
Liens created by the Collateral Documents. This Credit Agreement
has been, and each other Credit Document to which Alchem or any
Credit Party is a party will be, duly executed and delivered on
behalf of Alchem or the Credit Parties, as applicable. This
Credit Agreement constitutes, and each other Credit Document to
which Alchem or any Credit Party is a party when executed and
delivered will constitute, a legal, valid and binding obligation
of such Person enforceable against such party in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and
by general equitable principles (whether enforcement is sought by
proceedings in equity or at law).
6.5 No Conflicts.
Neither the execution and delivery of the Credit Documents,
nor the consummation of the transactions contemplated therein,
nor performance of and compliance with the terms and provisions
thereof by Alchem or any Credit Party will (a) violate or
conflict with any provision of its articles or certificate of
incorporation or bylaws or other organizational or governing
documents of such Person, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation
(including, without limitation, Regulation U or Regulation X),
order, writ, judgment, injunction, decree or permit applicable to
it, (c) violate, contravene or conflict with contractual
provisions of, or cause an event of default under, any indenture,
loan agreement, mortgage, deed of trust, contract or other
agreement or instrument to which it is a party or by which it may
be bound, the violation of which could have a Material Adverse
Effect, or (d) result in or require the creation of any Lien
(other than those contemplated in or created in connection with
the Credit Documents) upon or with respect to its properties.
6.6 No Default.
Except as disclosed in Schedule 6.6, (i) no Consolidated
Party is in default in any respect under any contract, lease,
loan agreement, indenture, mortgage, security agreement or other
agreement or obligation to which it is a party or by which any of
its properties is bound which default could reasonably be
expected to have a Material Adverse Effect and (ii) no Default or
Event of Default has occurred or exists.
6.7 Ownership.
Each Consolidated Party is the owner of, and has good and
marketable title to, all of its respective assets and none of
such assets is subject to any Lien other than Permitted Liens.
6.8 Indebtedness.
Except as otherwise permitted under Section 8.1, the
Consolidated Parties have no Indebtedness.
6.9 Litigation.
Except as disclosed in Schedule 6.9, there are no actions,
suits or legal, equitable, arbitration or administrative
proceedings, pending or, to the knowledge of any Credit Party,
threatened against Alchem or any Consolidated Party which might
have a Material Adverse Effect.
6.10 Taxes.
Each Consolidated Party has filed, or caused to be filed,
all tax returns (federal, state, local and foreign) required to
be filed and paid (a) all amounts of taxes shown thereon to be
due (including interest and penalties) and (b) all other taxes,
fees, assessments and other governmental charges (including
mortgage recording taxes, documentary stamp taxes and intangibles
taxes) owing by it, except for such taxes (i) which are not yet
delinquent or (ii) that are being contested in good faith and by
proper proceedings, and against which adequate reserves are being
maintained in accordance with GAAP. No Credit Party is aware as
of the Closing Date of any proposed tax assessments against it or
any other Consolidated Party.
6.11 Compliance with Law.
Each Consolidated Party is in compliance with all
Requirements of Law and all other laws, rules, regulations,
orders and decrees (including without limitation Environmental
Laws) applicable to it, or to its properties, unless such failure
to comply could not have a Material Adverse Effect. No
Requirement of Law could cause a Material Adverse Effect.
6.12 ERISA.
(a) During the five-year period prior to the date on
which this representation is made or deemed made: (i) no
ERISA Event has occurred, and, to the best knowledge of the
Credit Parties, no event or condition has occurred or exists
as a result of which any ERISA Event could reasonably be
expected to occur, with respect to any Plan; (ii) no
"accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or
not waived, has occurred with respect to any Plan; (iii)
each Plan has been maintained, operated, and funded in
compliance with its own terms and in material compliance
with the provisions of ERISA, the Code, and any other
applicable federal or state laws; and (iv) no lien in favor
of the PBGC or a Plan has arisen or is reasonably likely to
arise on account of any Plan.
(b) The actuarial present value of all "benefit
liabilities" (as defined in Section 4001(a)(16) of ERISA),
whether or not vested, under each Single Employer Plan, as
of the last annual valuation date prior to the date on which
this representation is made or deemed made (determined, in
each case, in accordance with Financial Accounting Standards
Board Statement 87, utilizing the actuarial assumptions used
in such Plan's most recent actuarial valuation report), did
not exceed as of such valuation date the fair market value
of the assets of such Plan.
(c) Neither any Consolidated Party nor any ERISA
Affiliate has incurred, or, to the best knowledge of the
Credit Parties, could be reasonably expected to incur, any
withdrawal liability under ERISA to any Multiemployer Plan
or Multiple Employer Plan. Neither any Consolidated Party
nor any ERISA Affiliate would become subject to any
withdrawal liability under ERISA if any Consolidated Party
or any ERISA Affiliate were to withdraw completely from all
Multiemployer Plans and Multiple Employer Plans as of the
valuation date most closely preceding the date on which this
representation is made or deemed made. Neither any
Consolidated Party nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in
reorganization (within the meaning of Section 4241 of
ERISA), is insolvent (within the meaning of Section 4245 of
ERISA), or has been terminated (within the meaning of Title
IV of ERISA), and no Multiemployer Plan is, to the best
knowledge of the Credit Parties, reasonably expected to be
in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of
Section 406 of ERISA or Section 4975 of the Code) or breach
of fiduciary responsibility has occurred with respect to a
Plan which has subjected or may subject any Consolidated
Party or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the
Code, or under any agreement or other instrument pursuant to
which any Consolidated Party or any ERISA Affiliate has
agreed or is required to indemnify any person against any
such liability.
(e) Neither any Consolidated Party nor any ERISA
Affiliates has any material liability with respect to
"expected post-retirement benefit obligations" within the
meaning of the Financial Accounting Standards Board
Statement 106. Each Plan which is a welfare plan (as
defined in Section 3(1) of ERISA) to which Sections 601-609
of ERISA and Section 4980B of the Code apply has been
administered in compliance in all material respects of such
sections.
6.13 Subsidiaries.
Set forth on Schedule 6.13 is a complete and accurate list
of all Subsidiaries of each Consolidated Party as of the Closing
Date. Information on Schedule 6.13 includes jurisdiction of
incorporation, the number of shares of each class of Capital
Stock outstanding, the number and percentage of outstanding
shares of each class owned (directly or indirectly) by such
Consolidated Party; and the number and effect, if exercised, of
all outstanding options, warrants, rights of conversion or
purchase and all other similar rights with respect thereto. The
outstanding Capital Stock of all such Subsidiaries is validly
issued, fully paid and non-assessable and is owned by each such
Consolidated Party, directly or indirectly, free and clear of all
Liens (other than those arising under or contemplated in
connection with the Credit Documents). Other than as set forth
in Schedule 6.13, no Consolidated Party has outstanding any
securities convertible into or exchangeable for its Capital Stock
nor does any such Person have outstanding any rights to subscribe
for or to purchase or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise)
of, or any calls, commitments or claims of any character relating
to its Capital Stock.
6.14 Governmental Regulations, Etc.
(a) No part of the Letters of Credit or proceeds of
the Loans will be used, directly or indirectly, for the
purpose of purchasing or carrying any "margin stock" within
the meaning of Regulation G or Regulation U, or for the
purpose of purchasing or carrying or trading in any such
"margin stock". If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement to the
foregoing effect in conformity with the requirements of FR
Form U-1 referred to in Regulation U. No indebtedness being
reduced or retired out of the proceeds of the Loans was or
will be incurred for the purpose of purchasing or carrying
any margin stock within the meaning of Regulation U or any
"margin security" within the meaning of Regulation T.
"Margin stock" within the meaning of Regulation U does not
constitute more than 25% of the value of the consolidated
assets of the Consolidated Parties. None of the
transactions contemplated by this Credit Agreement
(including, without limitation, the direct or indirect use
of the proceeds of the Loans) will violate or result in a
violation of the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, or regulations
issued pursuant thereto, or Regulation G, T, U or X.
(b) No Consolidated Party is subject to regulation
under the Public Utility Holding Company Act of 1935, the
Federal Power Act or the Investment Company Act of 1940,
each as amended. In addition, no Consolidated Party is (i)
an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as
amended, and is not controlled by such a company, or (ii) a
"holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a
"subsidiary" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
(c) No director, executive officer or principal
shareholder of any Consolidated Party is a director,
executive officer or principal shareholder of any Lender.
For the purposes hereof the terms "director", "executive
officer" and "principal shareholder" (when used with
reference to any Lender) have the respective meanings
assigned thereto in Regulation O issued by the Board of
Governors of the Federal Reserve System.
(d) Each Consolidated Party has obtained, and holds in
full force and effect, all franchises, licenses, permits,
certificates, authorizations, qualifications,
accreditations, easements, rights of way and other rights,
consents and approvals which are necessary for the ownership
of its respective Property and to the conduct of its
respective businesses as presently conducted.
(e) No Consolidated Party is in violation of any
applicable statute, regulation or ordinance of the United
States of America, or of any state, city, town,
municipality, county or any other jurisdiction, or of any
agency thereof (including without limitation, environmental
laws and regulations), which violation is reasonably likely
to have a Material Adverse Effect.
(f) Each Consolidated Party is current with all
material reports and documents, if any, required to be filed
with any state or federal securities commission or similar
agency and is in full compliance in all material respects
with all applicable rules and regulations of such
commissions.
6.15 Purpose of Loans and Letters of Credit.
The proceeds of the Loans hereunder shall be used solely by
the Borrower to refinance at Closing certain existing
indebtedness of the Borrower (the "Refinancing"); to pay at
Closing fees and expenses incurred in connection with the
Refinancing; and to provide for working capital and general
corporate purposes of the Consolidated Parties on and after
Closing Date. The Letters of Credit shall be used only for or in
connection with appeal bonds, reimbursement obligations arising
in connection with surety, reclamation and workers compensation
bonds, reinsurance, domestic or international trade transactions
and obligations not otherwise aforementioned relating to
transactions entered into by the applicable account party in the
ordinary course of business.
6.16 Environmental Matters.
Except as otherwise disclosed on Schedule 6.16:
(a) Each of the facilities and properties owned,
leased or operated by the Consolidated Parties or any
Affiliate of any Consolidated Party (the "Properties") and
all operations at the Properties are in material compliance
with all applicable Environmental Laws, and there is no
violation of any Environmental Law with respect to the
Properties or the businesses operated by the Consolidated
Parties or any Affiliate of any Consolidated Party(the
"Businesses"), and there are no conditions relating to the
Businesses or Properties that could give rise to material
liability under any applicable Environmental Laws.
(b) None of the Properties contains, or has previously
contained, any Materials of Environmental Concern at, on or
under the Properties in amounts or concentrations that
constitute or constituted a material violation of, or could
reasonably be expected to give rise to material liability
under, Environmental Laws.
(c) Neither any Consolidated Party or any Affiliate
of any Consolidated Party has received any written or verbal
notice of, or inquiry from any Governmental Authority
regarding, any material violation, alleged violation, non-
compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws
with regard to any of the Properties or the Businesses, nor
does any Consolidated Party or any Affiliate of any
Consolidated Party have knowledge or reason to believe that
any such notice will be received or is being threatened.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties, or
generated, treated, stored or disposed of at, on or under
any of the Properties or any other location, in each case by
or on behalf of any Consolidated Party or any Affiliate of
any Consolidated Party in violation of, or in a manner that
could reasonably be expected to give rise to liability
under, any applicable Environmental Law that in any case
would have a Material Adverse Effect.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the best knowledge
of any Credit Party, threatened, under any Environmental Law
to which any Consolidated Party or any Affiliate of any
Consolidated Party is or will be named as a party, nor are
there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other
administrative or judicial requirements outstanding under
any Environmental Law with respect to the Consolidated
Parties, any Affiliate of any Consolidated Party, the
Properties or the Businesses.
(f) There has been no release or threat of release of
Materials of Environmental Concern at or from the
Properties, or arising from or related to the operations
(including, without limitation, disposal) of any
Consolidated Party or any Affiliate of any Consolidated
Party in connection with the Properties or otherwise in
connection with the Businesses, in violation of or in
amounts or in a manner that could reasonably expected to
give rise to liability under Environmental Laws that in any
case would have a Material Adverse Effect.
6.17 Intellectual Property.
Each Consolidated Party owns, or has the legal right to use,
all trademarks, tradenames, copyrights, technology, know-how and
processes (the "Intellectual Property") necessary for each of
them to conduct its business as currently conducted except for
those the failure to own or have such legal right to use could
not have a Material Adverse Effect. No claim has been asserted
and is pending by any Person challenging or questioning the use
by any Consolidated Party of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property,
nor does any Credit Party know of any such claim, and to the
Credit Parties' knowledge the use of such Intellectual Property
by any Consolidated Party does not infringe on the rights of any
Person, except for such claims and infringements that in the
aggregate, could not have a Material Adverse Effect.
6.18 Solvency.
Each Credit Party is Solvent.
6.19 Investments.
All Investments of each Consolidated Party are Permitted
Investments.
6.20 Location of Collateral.
Set forth on Schedule 6.20(a) is a list of all locations
where any tangible personal property of a Consolidated Party is
located as of the Closing Date, including county and state where
located. Set forth on Schedule 6.20(b) is the chief executive
office and principal place of business of each Consolidated Party
as of the Closing Date.
6.21 Disclosure.
Neither this Credit Agreement nor any financial statements
delivered to the Lenders nor any other document, certificate or
statement furnished to the Lenders by or on behalf of any
Consolidated Party in connection with the transactions
contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make
the statements contained therein or herein not misleading.
6.22 No Burdensome Restrictions.
No Consolidated Party is a party to any agreement or
instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law,
rule or regulation which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
6.23 Brokers' Fees.
No Consolidated Party has any obligation to any Person other
than NationsBank Securities, Inc. in respect of any finder's,
broker's, investment banking or other similar fee in connection
with any of the transactions contemplated under the Credit
Documents.
6.24 Labor Matters.
There are no collective bargaining agreements or
Multiemployer Plans covering the employees of a Consolidated
Party as of the Closing Date and none of the Consolidated Parties
has suffered any strikes, walkouts, work stoppages or other
material labor difficulty within the last five years.
6.25 Nature of Business.
As of the Closing Date, the Consolidated Parties are engaged
in the business of manufacturing and marketing woven and knitted
finished and unfinished cotton, synthetic and blended fabrics and
related services.
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long
as this Credit Agreement is in effect or any amounts payable
hereunder or under any other Credit Document shall remain
outstanding, and until all of the Commitments hereunder shall
have terminated:
7.1 Information Covenants.
The Borrower will furnish, or cause to be furnished, to the
Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as
available, and in any event within 90 days after the close
of each fiscal year of the Consolidated Parties, a
consolidated balance sheet and income statement of the
Consolidated Parties, as of the end of such fiscal year,
together with related consolidated statements of operations
and retained earnings and of cash flows for such fiscal
year, setting forth in comparative form consolidated figures
for the preceding fiscal year, all such financial
information described above to be in reasonable form and
detail and audited by independent certified public
accountants of recognized national standing reasonably
acceptable to the Administrative Agent and whose opinion
shall be to the effect that such financial statements have
been prepared in accordance with GAAP (except for changes
with which such accountants concur) and shall not be limited
as to the scope of the audit or qualified as to the status
of the Consolidated Parties as a going concern.
(b) Quarterly Financial Statements. As soon as
available, and in any event within 45 days after the close
of each fiscal quarter of the Consolidated Parties (other
than the fourth fiscal quarter, in which case 90 days after
the end thereof) a consolidated and consolidating balance
sheet and income statement of the Consolidated Parties, as
of the end of such fiscal quarter, together with related
consolidated and consolidating statements of operations and
of cash flows for such fiscal quarter, in each case setting
forth in comparative form consolidated figures for the
corresponding period of the preceding fiscal year, all such
financial information described above to be in reasonable
form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of
the chief financial officer of the Borrower to the effect
that such quarterly financial statements fairly present in
all material respects the financial condition of the
Consolidated Parties and have been prepared in accordance
with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments.
(c) Officer's Certificate. At the time of delivery of
the financial statements provided for in Sections 7.1(a) and
7.1(b) above, a certificate of the chief financial officer
of the Borrower substantially in the form of Exhibit 7.1(c),
(i) demonstrating compliance with the financial covenants
contained in Section 7.11 by calculation thereof as of the
end of each such fiscal period and (ii) stating that no
Default or Event of Default exists, or if any Default or
Event of Default does exist, specifying the nature and
extent thereof and what action the Credit Parties propose to
take with respect thereto.
(d) Borrowing Base Certificates. Within 15 days after
the end of each fiscal month, a Borrowing Base Certificate
as of the end of the immediately preceding month,
substantially in the form of Exhibit 7.1(d) and certified by
the chief financial officer of the Borrower to be true and
correct as of the date thereof.
(e) Annual Business Plan and Budgets. As soon as
available, and in any event within 30 days after the close
of each fiscal year of the Consolidated Parties beginning
with the fiscal year ending June 27, 1998, an annual
business plan and budget of the Consolidated Parties
containing, among other things, projected financial
statements for the next fiscal year.
(f) Compliance With Certain Provisions of the Credit
Agreement. Within 90 days after the end of each fiscal year
of the Borrower, a certificate containing information
regarding the amount of all Asset Dispositions, Debt
Issuances and Equity Issuances that were made during the
prior fiscal year.
(g) Accountant's Certificate. Within the period for
delivery of the annual financial statements provided in
Section 7.1(a), a certificate of the accountants conducting
the annual audit stating that they have reviewed this Credit
Agreement and stating further whether, in the course of
their audit, they have become aware of any Default or Event
of Default and, if any such Default or Event of Default
exists, specifying the nature and extent thereof.
(h) Auditor's Reports. Promptly upon receipt thereof,
a copy of any other report or "management letter" submitted
by independent accountants to any Consolidated Party in
connection with any annual, interim or special audit of the
books of such Person.
(i) Reports. Promptly upon transmission or receipt
thereof, (i) copies of any filings and registrations with,
and reports to, the Securities and Exchange Commission, or
any successor agency, and copies of all financial
statements, proxy statements, notices and reports as any
Consolidated Party shall file with the Securities and
Exchange Commission or shall send to a holder of any
Indebtedness owed by any Consolidated Party in its capacity
as such a holder and (ii) upon the request of the
Administrative Agent, all reports and written information to
and from the United States Environmental Protection Agency,
or any state or local agency responsible for environmental
matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for
health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety
matters.
(j) Notices. Upon obtaining knowledge thereof, the
Borrower will give written notice to the Administrative
Agent immediately of (i) the occurrence of an event or
condition consisting of a Default or Event of Default,
specifying the nature and existence thereof and what action
the Credit Parties propose to take with respect thereto, and
(ii) the occurrence of any of the following with respect to
any Consolidated Party (A) the pendency or commencement of
any litigation, arbitral or governmental proceeding against
such Person which if adversely determined reasonably likely
to have a Material Adverse Effect, (B) the institution of
any governmental proceedings against such Person with
respect to, or the receipt of notice by such Person of
potential liability or responsibility for, violation or
alleged violation of any federal, state or local law, rule
or regulation, including but not limited to, Environmental
Laws, the violation of which could reasonably be expected to
have a Material Adverse Effect, or (C) any notice or
determination concerning the imposition of any withdrawal
liability by a Multiemployer Plan against such Person or any
ERISA Affiliate, the determination that a Multiemployer Plan
is, or is expected to be, in reorganization within the
meaning of Title IV of ERISA or the termination of any Plan.
(k) ERISA. Upon obtaining knowledge thereof, the
Borrower will give written notice to the Administrative
Agent promptly (and in any event within five business days)
of: (i) of any event or condition, including, but not
limited to, any Reportable Event, that constitutes, or might
reasonably lead to, an ERISA Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in
ERISA or otherwise of any withdrawal liability assessed
against the Borrower or any of its ERISA Affiliates, or of a
determination that any Multiemployer Plan is in
reorganization or insolvent (both within the meaning of
Title IV of ERISA); (iii) the failure to make full payment
on or before the due date (including extensions) thereof of
all amounts which any Consolidated Party or any ERISA
Affiliate is required to contribute to each Plan pursuant to
its terms and as required to meet the minimum funding
standard set forth in ERISA and the Code with respect
thereto; or (iv) any change in the funding status of any
Plan that could have a Material Adverse Effect, together
with a description of any such event or condition or a copy
of any such notice and a statement by the chief financial
officer of the Borrower briefly setting forth the details
regarding such event, condition, or notice, and the action,
if any, which has been or is being taken or is proposed to
be taken by the Credit Parties with respect thereto.
Promptly upon request, the Credit Parties shall furnish the
Administrative Agent and the Lenders with such additional
information concerning any Plan as may be reasonably
requested, including, but not limited to, copies of each
annual report/return (Form 5500 series), as well as all
schedules and attachments thereto required to be filed with
the Department of Labor and/or the Internal Revenue Service
pursuant to ERISA and the Code, respectively, for each "plan
year" (within the meaning of Section 3(39) of ERISA).
(l) Environmental.
(i) Upon the reasonable written request of the
Administrative Agent, the Credit Parties will furnish
or cause to be furnished to the Administrative Agent,
at the Borrower's reasonable expense, a report of an
environmental assessment of reasonable scope, form and
depth, (including, where appropriate, invasive soil or
groundwater sampling) by a consultant reasonably
acceptable to the Administrative Agent as to the nature
and extent of the presence of any Materials of
Environmental Concern on any Properties (as defined in
Section 6.16) and as to the compliance by any
Consolidated Party with Environmental Laws at such
Properties. If the Credit Parties fail to deliver such
an environmental report within seventy-five (75) days
after receipt of such reasonable written request then
the Administrative Agent may arrange for same, and the
Consolidated Parties hereby grant to the Administrative
Agent and their representatives access to the
Properties to reasonably undertake such an assessment
(including, where appropriate, invasive soil or
groundwater sampling). The reasonable cost of any
assessment arranged for by the Administrative Agent
pursuant to this provision will be payable by the
Borrower on demand and added to the obligations secured
by the Collateral Documents.
(ii) The Consolidated Parties will conduct and
complete all investigations, studies, sampling, and
testing and all remedial, removal, and other actions
necessary to address all Materials of Environmental
Concern on , from or affecting any of the Properties to
the extent necessary to be in compliance with all
Environmental Laws and with the validly issued orders
and directives of all Governmental Authorities with
jurisdiction over such Properties to the extent any
failure could have a Material Adverse Effect.
(m) Additional Trademarks. At the time of delivery of
the financial statements and reports provided for in Section
7.1(a), a report signed by the chief financial officer or
treasurer of the Borrower setting forth (i) a list of
registration numbers for all material trademarks, service
marks and tradenames awarded to any Consolidated Party since
the last day of the immediately preceding fiscal year and
(ii) a list of all material trademark applications, service
xxxx applications and trade name applications submitted by
any Consolidated Party since the last day of the immediately
preceding fiscal year and the status of each such
application, all in such form as shall be reasonably
satisfactory to the Administrative Agent.
(n) Other Information. With reasonable promptness
upon any such request, such other information regarding the
business, properties or financial condition of any
Consolidated Party as the Administrative Agent or the
Required Lenders may reasonably request.
7.2 Preservation of Existence and Franchises.
Except as a result of or in connection with a dissolution,
merger or disposition of a Subsidiary permitted under Section 8.4
or Section 8.5, each Credit Party will, and will cause each of
its Subsidiaries to, do all things necessary to preserve and keep
in full force and effect its existence, rights, franchises and
authority.
7.3 Books and Records.
Each Credit Party will, and will cause each of its
Subsidiaries to, keep complete and accurate books and records of
its transactions in accordance with good accounting practices on
the basis of GAAP (including the establishment and maintenance of
appropriate reserves).
7.4 Compliance with Law.
Each Credit Party will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and
orders, and all applicable restrictions imposed by all
Governmental Authorities, applicable to it and its Property if
noncompliance with any such law, rule, regulation, order or
restriction is reasonably likely to have a Material Adverse
Effect.
7.5 Payment of Taxes and Other Indebtedness.
Each Credit Party will, and will cause each of its
Subsidiaries to, pay and discharge (a) all taxes, assessments and
governmental charges or levies imposed upon it, or upon its
income or profits, or upon any of its properties, before they
shall become delinquent, (b) all lawful claims (including claims
for labor, materials and supplies) which, if unpaid, might give
rise to a Lien upon any of its properties, and (c) except as
prohibited hereunder, all of its other Indebtedness as it shall
become due; provided, however, that no Consolidated Party shall
be required to pay any such tax, assessment, charge, levy, claim
or Indebtedness which is being contested in good faith by
appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP, unless
the failure to make any such payment (i) is reasonably likely to
give rise to an immediate right to foreclose on a Lien securing
such amounts or (ii) is reasonably likely to have a Material
Adverse Effect.
7.6 Insurance.
Each Credit Party will, and will cause each of its
Subsidiaries to, at all times maintain in full force and effect
insurance (including worker's compensation insurance, liability
insurance, casualty insurance and business interruption
insurance) in such amounts, covering such risks and liabilities
and with such deductibles or self-insurance retentions as are in
accordance with normal industry practice (or as otherwise
required by the Collateral Documents). The Collateral Agent
shall be named as loss payee and/or additional insured with
respect to any such insurance providing coverage in respect of
any Collateral, and each provider of any such insurance shall
agree, by endorsement upon the policy or policies issued by it or
by independent instruments furnished to the Collateral Agent,
that it will give the Collateral Agent thirty (30) days prior
written notice before any such policy or policies shall be
canceled, and that no act or default of any Consolidated Party or
any other Person shall affect the rights of the Collateral Agent
or the Lenders under such policy or policies.
7.7 Maintenance of Property.
Each Credit Party will, and will cause each of its
Subsidiaries to, maintain and preserve its properties and
equipment material to the conduct of its business in good repair,
working order and condition, normal wear and tear and casualty
and condemnation excepted, and will make, or cause to be made, in
such properties and equipment from time to time all repairs,
renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent
and in the manner customary for companies in similar businesses.
7.8 Performance of Obligations.
Each Credit Party will, and will cause each of its
Subsidiaries to, perform in all material respects all of its
obligations under the terms of all material agreements,
indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
7.9 Use of Proceeds.
The Borrower will use the proceeds of the Loans and will use
the Letters of Credit solely for the purposes set forth in
Section 6.15.
7.10 Audits/Inspections.
Upon reasonable notice and during normal business hours (and
without any unreasonable interference with the business of the
Consolidated Parties), each Credit Party will, and will cause
each of its Subsidiaries to, permit representatives appointed by
the Administrative Agent and/or the Collateral Agent, including,
without limitation, independent accountants, agents, attorneys,
and appraisers to visit and inspect its property, including its
books and records, its accounts receivable and inventory, its
facilities and its other business assets, and to make photocopies
or photographs thereof and to write down and record any
information such representative obtains and shall permit the
Administrative Agent and/or the Collateral Agent and/or their
respective representatives to investigate and verify the accuracy
of information provided to the Lenders and to discuss all such
matters with the officers, employees and representatives of such
Person. The Credit Parties agree that the Administrative Agent
and/or the Collateral Agent and/or their respective
representatives may, at the expense of the Credit Parties,
conduct an audit of the Collateral (i) annually and (ii) at any
reasonable time and from time to time during the continuance of
any Event of Default.
7.11 Financial Covenants.
(a) Interest Coverage Ratio. The Interest Coverage
Ratio, as of the last day of each fiscal quarter of the
Consolidated Parties, shall be greater than or equal to:
(i) for the period from the Closing Date to
and including the next to last day of fiscal year 1998
of the Consolidated Parties, 2.50 to 1.00;
(ii) for the period from the last day of
fiscal year 1998 to and including the next to last day
of fiscal year 1999 of the Consolidated Parties, 2.90
to 1.00;
(iii) for the period from the last day of
fiscal year 1999 to and including the next to last day
of fiscal year 2000 of the Consolidated Parties, 3.30
to 1.00;
(iv) for the period from the last day of
fiscal year 2000 to and including the next to last day
of fiscal year 2001 of the Consolidated Parties, 3.60
to 1.00;
(v) for the period from the last day of
fiscal year 2001 to and including the next to last day
of fiscal year 2002 of the Consolidated Parties, 3.90
to 1.00; and
(vi) for the period from the last day of
fiscal year 2002 and thereafter, 4.00 to 1.00.
(b) Current Ratio. The Current Ratio, as of the last
day of each fiscal quarter of the Consolidated Parties,
shall be greater than or equal to 3.00 to 1.00.
(c) Leverage Ratio. The Leverage Ratio, as of the
last day of each fiscal quarter of the Consolidated Parties,
shall be less than or equal to:
(i) for the period from the Closing Date to
and including the next to last day of fiscal year 1998
of the Consolidated Parties, 4.50 to 1.00;
(ii) for the period from the last day of
fiscal year 1998 to and including the next to last day
of fiscal year 1999 of the Consolidated Parties, 3.80
to 1.00;
(iii) for the period from the last day of
fiscal year 1999 to and including the next to last day
of fiscal year 2000 of the Consolidated Parties, 3.30
to 1.00;
(iv) for the period from the last day of
fiscal year 2000 to and including the next to last day
of fiscal year 2001 of the Consolidated Parties, 3.00
to 1.00;
(v) for the period from the last day of
fiscal year 2001 to and including the next to last day
of fiscal year 2002 of the Consolidated Parties, 2.80
to 1.00; and
(vi) for the period from the last day of
fiscal year 2002 and thereafter, 2.60 to 1.00.
(d) Consolidated Tangible Net Worth. At all times the
Consolidated Tangible Net Worth shall be greater than or
equal to:
(i) for the period from the Closing Date to
and including the next to last day of fiscal year 1998
of the Consolidated Parties, $50,000,000;
(ii) for the period from the last day of
fiscal year 1998 to and including the next to last day
of fiscal year 1999 of the Consolidated Parties,
$60,000,000;
(iii) for the period from the last day of
fiscal year 1999 to and including the next to last day
of fiscal year 2000 of the Consolidated Parties,
$75,000,000;
(iv) for the period from the last day of
fiscal year 2000 to and including the next to last day
of fiscal year 2001 of the Consolidated Parties,
$90,000,000;
(v) for the period from the last day of
fiscal year 2001 to and including the next to last day
of fiscal year 2002 of the Consolidated Parties,
$105,000,000; and
(vi) for the period from the last day of
fiscal year 2002 and thereafter, $120,000,000.
7.12 Additional Credit Parties.
As soon as practicable and in any event within 30 days after
any Person becomes a Subsidiary of any Credit Party, the Borrower
shall provide the Administrative Agent with written notice
thereof and shall (i) if such Person is a Domestic Subsidiary of
a Credit Party, cause such Person to execute a Joinder Agreement
in substantially the same form as Exhibit 7.12, (ii) cause
certificates representing 100% (if such Person is a Domestic
Subsidiary of a Credit Party) or 65% (if such Person is a direct
Foreign Subsidiary of a Credit Party) of the Capital Stock of
such Person to be delivered to the Collateral Agent (together
with undated stock powers signed in blank (unless, with respect
to a Foreign Subsidiary, such stock powers are deemed unnecessary
by the Administrative Agent in its reasonable discretion under
the law of the jurisdiction of incorporation of such Person)) and
pledged to the Collateral Agent pursuant to an appropriate pledge
agreement(s) in substantially the form of the Pledge Agreement
and otherwise in form acceptable to the Administrative Agent and
(iii) deliver such other documentation as the Administrative
Agent may reasonably request in connection with the foregoing,
including, without limitation, appropriate UCC-1 financing
statements, environmental reports, landlord's waivers, certified
resolutions and other organizational and authorizing documents of
such Person, favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding
effect and enforceability of the documentation referred to above
and the perfection of the Administrative Agent's liens
thereunder) and other items of the types required to be delivered
pursuant to Section 5.1(e), all in form, content and scope
reasonably satisfactory to the Administrative Agent.
7.13 Pledged Assets; Release of Collateral.
(a) Each Credit Party will, and will cause each of its
Subsidiaries to, (i) cause all of its Trading Assets located
in the United States to be subject at all times to first
priority and perfected Liens in favor of the Collateral
Agent pursuant to the terms and conditions of the Collateral
Documents and (ii) cause 100% of the Capital Stock in each
Credit Party (including the Borrower) and each direct or
indirect Domestic Subsidiary of the Borrower and 65% of the
Capital Stock in each direct Foreign Subsidiary of the
Borrower and its Domestic Subsidiaries to be subject at all
times to a first priority, perfected Lien in favor of the
Collateral Agent pursuant to the terms and conditions of the
Collateral Documents or such other security documents as the
Administrative Agent shall reasonably request.
(b) Each Credit Party shall, and shall cause each of
its Subsidiaries to, take such action (including but not
limited to the actions set forth in Sections 5.1(e)) at its
own expense as requested by the Administrative Agent to
ensure that the Collateral Agent has a first priority
perfected Lien to secure the Credit Party Obligations in all
Trading Assets of the Credit Parties located in the United
States, subject only to Permitted Liens. Each Credit Party
shall, and shall cause each of its Subsidiaries to, adhere
to the covenants regarding the location of Collateral as set
forth in the Collateral Documents.
(c) In the event that the Borrower shall concurrently
obtain an investment grade long-term senior debt rating from
any two of Xxxxx'x, S&P, Xxxx & Xxxxxx Credit Rating Company
or Fitch Investors Service, then the Administrative Agent
and/or the Collateral Agent, as applicable, shall deliver to
the Borrower, upon the Borrower's request and at the
Borrower's expense, such documentation as is reasonably
necessary to evidence the release of the Collateral Agent's
security interest, if any, in all or any portion of the
Collateral, including, without limitation, terminations of
UCC financing statements and the return of stock
certificates.
7.14 Factoring Agreements.
Promptly upon the Borrower or any Material Subsidiary
entering into a Factoring Agreement, deliver or cause such Person
to deliver an assignment of factoring proceeds, consented to in
writing by the applicable Factor and otherwise in form and
substance satisfactory to the Administrative Agent, with respect
to such Factoring Agreement.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that, so long
as this Credit Agreement is in effect or any amounts payable
hereunder or under any other Credit Document shall remain
outstanding, and until all of the Commitments hereunder shall
have terminated:
8.1 Indebtedness.
The Credit Parties will not permit any Consolidated Party to
contract, create, incur, assume or permit to exist any
Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement
and the other Credit Documents;
(b) Indebtedness of the Borrower existing as of the
Closing Date and set forth in Schedule 8.1 (and renewals,
refinancings and extensions thereof on terms and conditions
no less favorable to such Person than such existing
Indebtedness);
(c) purchase money Indebtedness (including Capital
Leases and Synthetic Leases) hereafter incurred by the
Borrower to finance the purchase of fixed assets provided
that (i) the total of all such Indebtedness shall not exceed
an aggregate principal amount of $2,500,000 at any one time
outstanding (including any such Indebtedness referred to in
subsection (b) above); (ii) such Indebtedness when incurred
shall not exceed the purchase price of the asset(s)
financed; and (iii) no such Indebtedness shall be refinanced
for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing;
(d) obligations of the Borrower or any of its
Subsidiaries in respect of Hedging Agreements entered into
in order to manage existing or anticipated interest rate or
exchange rate risks and not for speculative purposes;
(e) intercompany Indebtedness arising out of loans and
advances permitted under Section 8.6; and
(f) Indebtedness of the Borrower arising under the
Senior Note Indenture and the Senior Notes and Guaranty
Obligations of any Guarantor with respect thereto.
Notwithstanding anything to the contrary set forth in this
Section 8.1 or in any other provision of this Credit Agreement,
none of the Consolidated Parties shall be permitted to contract,
create, incur, assume or permit to exist any Guaranty Obligations
in respect of any Indebtedness of Delta Woodside or any of its
Subsidiaries other than Guaranty Obligations arising in
connection with standby letters of credit or surety bonds issued
to satisfy workers' compensation requirements.
8.2 Liens.
The Credit Parties will not permit any Consolidated Party to
contract, create, incur, assume or permit to exist any Lien
except for Permitted Liens with respect to (i) any of its
Property, whether now owned or after acquired, or (ii) the South
Xxxxxxxx Xxxx Property.
8.3 Nature of Business.
The Credit Parties will not permit any Consolidated Party to
substantively alter the character or fields of the business
conducted by such Person as of the Closing Date.
8.4 Consolidation, Merger, Dissolution, etc.
Except in connection with an Asset Disposition permitted by
the terms of Section 8.5, the Credit Parties will not permit any
Consolidated Party to enter into any transaction of merger or
consolidation or liquidate, wind up or dissolve itself (or suffer
any liquidation or dissolution); provided that, notwithstanding
the foregoing provisions of this Section 8.4, (a) the Borrower
may merge or consolidate with any of its Subsidiaries provided
that (i) the Borrower shall be the continuing or surviving
corporation, (ii) the Credit Parties shall cause to be executed
and delivered such documents, instruments and certificates as the
Administrative Agent may reasonably request so as to cause the
Credit Parties to be in compliance with the terms of Section 7.13
after giving effect to such transaction and (iii) the Borrower
shall have delivered to the Administrative Agent a certificate
demonstrating that after giving effect to such transaction no
Default or Event of Default would exist, (b) any Credit Party
other than the Borrower may merge or consolidate with any other
Credit Party other than the Borrower provided that (i) the Credit
Parties shall cause to be executed and delivered such documents,
instruments and certificates as the Administrative Agent may
reasonably request so as to cause the Credit Parties to be in
compliance with the terms of Section 7.13 after giving effect to
such transaction and (ii) the Borrower shall have delivered to
the Administrative Agent a certificate demonstrating that after
giving effect to such transaction no Default or Event of Default
would exist, (c) any Consolidated Party which is not a Credit
Party may be merged or consolidated with or into any Credit Party
provided that (i) such Credit Party shall be the continuing or
surviving corporation, (ii) the Credit Parties shall cause to be
executed and delivered such documents, instruments and
certificates as the Administrative Agent may reasonably request
so as to cause the Credit Parties to be in compliance with the
terms of Section 7.13 after giving effect to such transaction and
(iii) the Borrower shall have delivered to the Administrative
Agent a certificate demonstrating that after giving effect to
such transaction no Default or Event of Default would exist, (d)
any Consolidated Party which is not a Credit Party may be merged
or consolidated with or into any other Consolidated Party which
is not a Credit Party provided the Borrower shall have delivered
to the Administrative Agent a certificate demonstrating that
after giving effect to such transaction no Default or Event of
Default would exist, and (e) any Wholly-Owned Subsidiary of the
Borrower may dissolve, liquidate or wind up its affairs at any
time.
8.5 Asset Dispositions.
The Credit Parties will not permit any Consolidated Party to
make any Asset Disposition (including, without limitation, any
Sale and Leaseback Transaction) other than Excluded Asset
Dispositions unless (a) the consideration paid in connection
therewith is cash or Cash Equivalents, (b) if such transaction is
a Sale and Leaseback Transaction, such transaction is permitted
by the terms of Section 8.13, (c) such transaction does not
involve the sale or other disposition of a minority equity
interest in any Consolidated Party, (d) the aggregate net book
value of all of the assets sold or otherwise disposed of by the
Consolidated Parties in all such transactions after the Closing
Date shall not exceed $5,000,000, (e) no Default or Event of
Default shall have occurred and be continuing or would occur as a
consequence thereof, (f) if the aggregate net book value of all
of the assets sold or otherwise disposed such transaction exceeds
$500,000, then no later than 30 days prior to such Asset
Disposition, the Administrative Agent and the Lenders shall have
received a certificate of an officer of the Borrower specifying
the anticipated or actual date of such Asset Disposition, briefly
describing the assets to be sold or otherwise disposed of and
setting forth the net book value of such assets, the aggregate
consideration and the Net Cash Proceeds to be received for such
assets in connection with such Asset Disposition and (g) within
the period of 60 days following the consummation of such Asset
Disposition (with respect to any such Asset Disposition, the
"Application Period"), the Borrower shall apply (or cause to be
applied) an amount equal to the Net Cash Proceeds of such Asset
Disposition to (i) the purchase, acquisition or, in the case of
improvements to real property, construction of Eligible Assets or
(ii) to the prepayment of the Loans in accordance with the terms
of Section 3.3(b)(ii).
Upon a sale of assets or the sale of Capital Stock of a
Consolidated Party permitted by this Section 8.5, the
Administrative Agent and/or the Collateral Agent shall (to the
extent applicable) deliver to the Borrower, upon the Borrower's
request and at the Borrower's expense, such documentation as is
reasonably necessary to evidence the release of the Collateral
Agent's security interest, if any, in such assets or Capital
Stock, including, without limitation, amendments or terminations
of UCC financing statements, if any, the return of stock
certificates, if any, and the release of such Subsidiary from all
of its obligations, if any, under the Credit Documents.
8.6 Investments.
The Credit Parties will not permit any Consolidated Party to
make Investments in or to any Person, except for Permitted
Investments.
8.7 Restricted Payments.
The Credit Parties will not permit any Consolidated Party
to, directly or indirectly, declare, order, make or set apart any
sum for or pay any Restricted Payment, except (a) to make
dividends payable solely in the same class of Capital Stock of
such Person, (b) to make dividends or other distributions payable
to the Borrower (directly or indirectly through Subsidiaries),
(c) as permitted by Section 8.8 or Section 8.9, (d) Investments
in Delta Woodside and its Subsidiaries that do not, taken
together with Investments made pursuant to Section 8.6 and clause
(vii) of the definition of "Permitted Investments" set forth in
Section 1.1, exceed $500,000 in the aggregate at any one time
outstanding for all of the Consolidated Parties and (e) any other
Restricted Payment provided that (x) no Default or Event of
Default shall have occurred and be continuing or would occur as a
consequence thereof, (y) such Restricted Payment would be
permitted under the Indenture and (z) such Restricted Payment,
together with the aggregate of all other Restricted Payments
declared or made by the Consolidated Parties after the Closing
Date (excluding Restricted Payments permitted by clause (a), (b),
(c) or (d) of this paragraph or clause (ii) of the next
succeeding paragraph), is less than the sum of (1) $12.5 million,
plus (2) 50% of Consolidated Net Income for the period (taken as
one accounting period) from the beginning of the fiscal quarter
commencing June 29, 1997 to the last day of the most recently
ended fiscal quarter with respect to which the Administrative
Agent shall have received the financial statements required to be
delivered pursuant to Section 7.1(a) or (b) (or, if Consolidated
Net Income for such period is a deficit, less 100% of such
deficit), plus (3) 100% of the aggregate Net Cash Proceeds
received by the Consolidated Parties from any Excluded Equity
Issuance after the Closing Date and 50% of the aggregate Net Cash
Proceeds received by the Consolidated Parties from any Equity
Issuance which is not an Excluded Equity Issuance after the
Closing Date.
The foregoing provisions shall not prohibit (i) the payment of
any dividend within 60 days after the date of declaration
thereof, if at said date of declaration such payment would have
complied with this Section 8.7 and (ii) the repayment by the
Borrower on the Closing Date of up to $219 million in aggregate
principal amount of Indebtedness owed by the Borrower to Delta
Woodside and its Subsidiaries provided, that upon such repayment,
all remaining Indebtedness owed by the Borrower to Delta Woodside
and its Subsidiaries shall be contributed to the Borrower's
capital and thereby canceled.
The amount of any Restricted Payments (other than cash Restricted
Payments) shall be equal to the fair market value (evidenced by a
resolution of the board of directors of the applicable
Consolidated Party delivered together with the certificate
referred to below) on the date of the Restricted Payment of the
asset(s) proposed to be transferred by the Borrower or such
Subsidiary, as the case may be, pursuant to such Restricted
Payment. Not later than the date of making any Restricted
Payment, the Borrower shall deliver to the Administrative Agent a
certificate executed by an Executive Officer of the Borrower
stating that such Restricted Payment is permitted and setting
forth the basis upon which the calculations required by this
Section 8.7 were computed, which calculations may be based upon
the Borrower's latest available financial statements.
8.8 Prepayments of Indebtedness, etc.
If any Default or Event of Default has occurred and is
continuing or would be directly or indirectly caused as a result
thereof, the Credit Parties will not permit any Consolidated
Party to (a) after the issuance thereof, amend or modify (or
permit the amendment or modification of) any of the terms of any
Indebtedness if such amendment or modification would add or
change any terms in a manner adverse to the issuer of such
Indebtedness, or shorten the final maturity or average life to
maturity or require any payment to be made sooner than originally
scheduled or increase the interest rate applicable thereto or
change any subordination provision thereof, or (b) make (or give
any notice with respect thereto) any voluntary or optional
payment or prepayment or redemption or acquisition for value of
(including without limitation, by way of depositing money or
securities with the trustee with respect thereto before due for
the purpose of paying when due), refund, refinance or exchange of
any other Indebtedness (including without limitation any
Indebtedness arising under the Senior Note Indenture and the
Senior Notes).
8.9 Transactions with Affiliates.
The Credit Parties will not permit any Consolidated Party to
enter into or permit to exist any transaction or series of
transactions with any officer, director, shareholder, Subsidiary
or Affiliate of such Person other than (a) advances of working
capital to any Credit Party, (b) transfers of cash and assets to
any Credit Party, (c) transactions permitted by Section 8.1,
Section 8.4, Section 8.5, Section 8.6, or Section 8.7, (d) normal
compensation and reimbursement of expenses of officers and
directors, (e) any payment by a Consolidated Party for management
services pursuant to the Management Services Agreement dated as
of August 1, 1997, as the same may be amended from time to time,
between the Borrower and Delta Woodside provided that such
payments shall not exceed $5,000,000 in the aggregate for any
fiscal year, (f) any payment by the Borrower pursuant to the Tax
Sharing Agreement dated as of August 1, 1997, as the same may be
amended from time to time, between the Borrower and Delta
Woodside and (g) except as otherwise specifically limited in this
Credit Agreement, other transactions which are entered into in
the ordinary course of such Person's business on terms and
conditions substantially as favorable to such Person as would be
obtainable by it in a comparable arms-length transaction with a
Person other than an officer, director, shareholder, Subsidiary
or Affiliate.
8.10 Fiscal Year.
The Credit Parties will not permit any Consolidated Party to
change its fiscal year.
8.11 Limitation on Restricted Actions.
The Credit Parties will not permit any Consolidated Party
to, directly or indirectly, create or otherwise cause or suffer
to exist or become effective any encumbrance or restriction on
the ability of any such Person to (a) pay dividends or make any
other distributions to any Credit Party on its Capital Stock or
with respect to any other interest or participation in, or
measured by, its profits, (b) pay any Indebtedness or other
obligation owed to any Credit Party, (c) make loans or advances
to any Credit Party, (d) sell, lease or transfer any of its
properties or assets to any Credit Party, or (e) act as a
Guarantor and pledge its assets pursuant to the Credit Documents
or any renewals, refinancings, exchanges, refundings or extension
thereof, except (in respect of any of the matters referred to in
clauses (a)-(d) above) for such encumbrances or restrictions
existing under or by reason of (i) this Credit Agreement and the
other Credit Documents, (ii) the Senior Note Indenture and the
Senior Notes, in each case as in effect as of the Closing Date,
(iii) applicable law, (iv) any document or instrument governing
Indebtedness incurred pursuant to Section 8.1(c), provided that
any such restriction contained therein relates only to the asset
or assets constructed or acquired in connection therewith or (v)
any Permitted Lien or any document or instrument governing any
Permitted Lien, provided that any such restriction contained
therein relates only to the asset or assets subject to such
Permitted Lien.
8.12 Ownership of Subsidiaries.
The Credit Parties will not permit any Consolidated Party to
(i) permit any Person (other than the Borrower or any Wholly-
Owned Subsidiary of the Borrower) to own any Capital Stock of any
Subsidiary of the Borrower, (ii) permit any Subsidiary of the
Borrower to issue Capital Stock (except to the Borrower or to a
Wholly-Owned Subsidiary of the Borrower), (iii) permit, create,
incur, assume or suffer to exist any Lien on any Capital Stock of
any Subsidiary of the Borrower, in each case except (A) to
qualify directors where required by applicable law or to satisfy
other requirements of applicable law with respect to the
ownership of Capital Stock of Foreign Subsidiaries, (B) as a
result of or in connection with a dissolution, merger or
disposition of a Subsidiary permitted under Section 8.4 or
Section 8.5 or (C) for Permitted Liens and (iv) notwithstanding
anything to the contrary contained in clause (ii) above, permit
any Subsidiary of the Borrower to issue any shares of preferred
Capital Stock.
8.13 Sale Leasebacks.
Except for transactions entered into prior to the Closing
Date, the Credit Parties will not permit any Consolidated Party
to, directly or indirectly, become or remain liable as lessee or
as guarantor or other surety with respect to any lease, whether
an Operating Lease or a Capital Lease, of any Property (whether
real, personal or mixed), whether now owned or hereafter
acquired, (a) which such Consolidated Party has sold or
transferred or is to sell or transfer to a Person which is not a
Consolidated Party or (b) which such Consolidated Party intends
to use for substantially the same purpose as any other Property
which has been sold or is to be sold or transferred by such
Consolidated Party to another Person which is not a Consolidated
Party in connection with such lease.
8.14 Capital Expenditures.
The Credit Party will not permit Consolidated Capital
Expenditures for any fiscal year to exceed an amount equal to
150% of depreciation expense of the Borrower and its Subsidiaries
on a consolidated basis for the immediately preceding fiscal year
as determined in accordance with GAAP.
8.15 No Further Negative Pledges.
Except (a) pursuant to this Credit Agreement and the other
Credit Documents, (b) pursuant to the Senior Note Indenture and
the Senior Notes, in each case as in effect as of the Closing
Date and (c) pursuant to any document or instrument governing
Indebtedness incurred pursuant to Section 8.1(c), provided that
any such restriction contained therein relates only to the asset
or assets constructed or acquired in connection therewith, the
Credit Parties will not permit any Consolidated Party to enter
into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or assumption of any Lien upon
its properties or assets, whether now owned or hereafter
acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation.
8.16 Operating Lease Obligations.
The Credit Parties will not permit any Consolidated Party to
enter into, assume or permit to exist any obligations for the
payment of rental under Operating Leases which in the aggregate
for all such Persons would exceed $5,000,000 in any fiscal year.
8.17 Limitation on Foreign Operations.
The Credit Parties will not permit (i) the Borrower and its
Domestic Subsidiaries to own at any time less than 95% of
Consolidated Total Assets or (ii) as of as of the last day of
each fiscal quarter, the portion attributable to the Borrower and
its Domestic Subsidiaries of Consolidated Net Income for the four
quarters then ended to be less than 95% of Consolidated Net
Income for such period.
8.18 Factoring Agreements.
The Credit Parties will not permit any Consolidated Party to
incur or permit to exist any loans or advances from a Factor
(excluding charges, fees and interest accruing in the ordinary
course of business) under any Factoring Agreement.
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default.
An Event of Default shall exist upon the occurrence of any
of the following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall
(i) default in the payment when due of any
principal of any of the Loans or of any reimbursement
obligations arising from drawings under Letters of
Credit, or
(ii) default, and such default shall continue
for three (3) or more Business Days, in the payment
when due of any interest on the Loans or on any
reimbursement obligations arising from drawings under
Letters of Credit, or of any Fees or other amounts
owing hereunder, under any of the other Credit
Documents or in connection herewith or therewith; or
(b) Representations. Any representation, warranty or
statement made or deemed to be made by Alchem or any Credit
Party herein, in any of the other Credit Documents, or in
any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove untrue in
any material respect on the date as of which it was deemed
to have been made; or
(c) Covenants.
(i) Any Credit Party shall default in the
due performance or observance of any term, covenant or
agreement contained in Sections 7.2, 7.9, 7.11, 7.12,
7.13 or 8.1 through 8.18, inclusive;
(ii) Any Credit Party shall default in the
due performance or observance of any term, covenant or
agreement contained in Sections 7.1(a), (b) (c) or (d)
and such default shall continue unremedied for a period
of at least 5 days after the earlier of a responsible
officer of a Credit Party becoming aware of such
default or notice thereof by the Administrative Agent;
or
(iii) Any Credit Party shall default in
the due performance or observance by it of any term,
covenant or agreement (other than those referred to in
subsections (a), (b), (c)(i) or (c)(ii) of this Section
9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at
least 30 days after the earlier of a responsible
officer of a Credit Party becoming aware of such
default or notice thereof by the Administrative Agent;
or
(d) Other Credit Documents. (i) Alchem or any Credit
Party shall default in the due performance or observance of
any term, covenant or agreement in any of the other Credit
Documents (subject to applicable grace or cure periods, if
any), or (ii) except as a result of or in connection with a
dissolution, merger or disposition of a Subsidiary permitted
under Section 8.4 or Section 8.5, any Credit Document shall
fail to be in full force and effect or to give the
Administrative Agent and/or the Lenders the Liens, rights,
powers and privileges purported to be created thereby, or
Alchem or any Credit Party, as applicable, shall so state in
writing; or
(e) Guaranties. Except as the result of or in
connection with a dissolution, merger or disposition of a
Subsidiary permitted under Section 8.4 or Section 8.5, the
guaranty given by any Guarantor hereunder (including any
Additional Credit Party) or any provision thereof shall
cease to be in full force and effect, or any Guarantor
(including any Additional Credit Party) hereunder or any
Person acting by or on behalf of such Guarantor shall deny
or disaffirm such Guarantor's obligations under such
guaranty, or any Guarantor shall default in the due
performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant to any
guaranty; or
(f) Bankruptcy, etc. Any Bankruptcy Event shall occur
with respect to Alchem or any Consolidated Party; or
(g) Defaults under Other Agreements.
(i) Any Consolidated Party shall default in
the performance or observance (beyond the applicable
grace period with respect thereto, if any) of any
material obligation or condition of any contract or
lease material to the Consolidated Parties and the
other Person party to such contract or lease shall have
notified the applicable Consolidated Party that such
other Person considers such Consolidated Party to be in
default of such contract or lease; or
(ii) With respect to any Indebtedness (other
than Indebtedness outstanding under this Credit
Agreement) in excess of $250,000 in the aggregate for
the Consolidated Parties taken as a whole, (A) any
Consolidated Party shall (1) default in any payment
(beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness,
or (2) the occurrence and continuance of a default in
the observance or performance relating to such
Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or
any other event or condition shall occur or condition
exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders
of such Indebtedness (or trustee or agent on behalf of
such holders) to cause (determined without regard to
whether any notice or lapse of time is required), any
such Indebtedness to become due prior to its stated
maturity; or (B) any such Indebtedness shall be
declared due and payable, or required to be prepaid
other than by a regularly scheduled required
prepayment, prior to the stated maturity thereof; or
(h) Judgments. One or more judgments or decrees shall
be entered against one or more of the Consolidated Parties
involving a liability of $250,000 or more in the aggregate
(to the extent not paid or fully covered by insurance
provided by a carrier who has acknowledged coverage and has
the ability to perform) and any such judgments or decrees
shall not have been vacated, discharged or stayed or bonded
pending appeal within 30 days from the entry thereof; or
(i) ERISA. Any of the following events or conditions,
if such event or condition could have a Material Adverse
Effect: (i) any "accumulated funding deficiency," as such
term is defined in Section 302 of ERISA and Section 412 of
the Code, whether or not waived, shall exist with respect to
any Plan, or any lien shall arise on the assets of any
Consolidated Party or any ERISA Affiliate in favor of the
PBGC or a Plan; (ii) an ERISA Event shall occur with respect
to a Single Employer Plan, which is, in the reasonable
opinion of the Administrative Agent, likely to result in the
termination of such Plan for purposes of Title IV of ERISA;
(iii) an ERISA Event shall occur with respect to a
Multiemployer Plan or Multiple Employer Plan, which is, in
the reasonable opinion of the Administrative Agent, likely
to result in (A) the termination of such Plan for purposes
of Title IV of ERISA, or (B) any Consolidated Party or any
ERISA Affiliate incurring any liability in connection with a
withdrawal from, reorganization of (within the meaning of
Section 4241 of ERISA), or insolvency or (within the meaning
of Section 4245 of ERISA) such Plan; or (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject any
Consolidated Party or any ERISA Affiliate to any liability
under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other
instrument pursuant to which any Consolidated Party or any
ERISA Affiliate has agreed or is required to indemnify any
person against any such liability; or
(j) Senior Note Indenture. There shall occur and be
continuing any Event of Default under and as defined in the
Senior Note Indenture; or
(k) Ownership. There shall occur a Change of Control.
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time
thereafter unless and until such Event of Default has been waived
by the requisite Lenders (pursuant to the voting requirements of
Section 11.6) or cured to the reasonable satisfaction of the
requisite Lenders (pursuant to the voting procedures in Section
11.6), the Administrative Agent shall, upon the request and
direction of the Required Lenders, by written notice to the
Credit Parties take any of the following actions:
(a) Termination of Commitments. Declare the
Commitments terminated whereupon the Commitments shall be
immediately terminated.
(b) Acceleration. Declare the unpaid principal of and
any accrued interest in respect of all Loans, any
reimbursement obligations arising from drawings under
Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by the Borrower to
the Administrative Agent and/or any of the Lenders hereunder
to be due whereupon the same shall be immediately due and
payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower.
(c) Cash Collateral. Direct the Borrower to pay (and
the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default under Section
9.1(f), it will immediately pay) to the Administrative Agent
or the Collateral Agent (as determined by the Administrative
Agent) additional cash, to be held by the Administrative
Agent or the Collateral Agent, as applicable, for the
benefit of the Lenders, in a cash collateral account as
additional security for the LOC Obligations in respect of
subsequent drawings under all then outstanding Letters of
Credit in an amount equal to the maximum aggregate amount
which may be drawn under all Letters of Credits then
outstanding.
(d) Enforcement of Rights. Enforce (or, in the case
of any Collateral Documents, direct the Collateral Agent to
enforce) any and all rights and interests created and
existing under the Credit Documents including, without
limitation, all rights and remedies existing under the
Collateral Documents, all rights and remedies against a
Guarantor and all rights of set-off.
Notwithstanding the foregoing, if an Event of Default
specified in Section 9.1(f) shall occur, then the Commitments
shall automatically terminate and all Loans, all reimbursement
obligations arising from drawings under Letters of Credit, all
accrued interest in respect thereof, all accrued and unpaid Fees
and other indebtedness or obligations owing to the Administrative
Agent, the Collateral Agent and/or any of the Lenders hereunder
automatically shall immediately become due and payable without
the giving of any notice or other action by the Administrative
Agent, the Collateral Agent or the Lenders.
SECTION 10
AGENCY PROVISIONS
10.1 Appointment, Powers and Immunities.
Each Lender hereby irrevocably appoints and authorizes (1)
the Administrative Agent to act as its Administrative Agent under
this Credit Agreement and the other Credit Documents with such
powers and discretion as are specifically delegated to the
Administrative Agent by the terms of this Credit Agreement and
the other Credit Documents, together with such other powers as
are reasonably incidental thereto and (2) the Collateral Agent to
act as its Collateral Agent under this Credit Agreement and the
other Credit Documents with such powers and discretion as are
specifically delegated to the Collateral Agent by the terms of
this Credit Agreement and the other Credit Documents, together
with such other powers as are reasonably incidental thereto. The
Administrative Agent and the Collateral Agent (which terms as
used in this sentence and in Section 10.5 and the first sentence
of Section 10.6 hereof shall include their respective Affiliates
and its own and its Affiliates' officers, directors, employees,
and agents): (a) shall not have any duties or responsibilities
except those expressly set forth in this Credit Agreement and
shall not be a trustee or fiduciary for any Lender; (b) shall not
be responsible to the Lenders for any recital, statement,
representation, or warranty (whether written or oral) made in or
in connection with any Credit Document or any certificate or
other document referred to or provided for in, or received by any
of them under, any Credit Document, or for the value, validity,
effectiveness, genuineness, enforceability, or sufficiency of any
Credit Document, or any other document referred to or provided
for therein or for any failure by any Credit Party or any other
Person to perform any of its obligations thereunder; (c) shall
not be responsible for or have any duty to ascertain, inquire
into, or verify the performance or observance of any covenants or
agreements by Alchem or any Credit Party or the satisfaction of
any condition or to inspect the property (including the books and
records) of Alchem or any Credit Party or any of its Subsidiaries
or Affiliates; (d) shall not be required to initiate or conduct
any litigation or collection proceedings under any Credit
Document; and (e) shall not be responsible for any action taken
or omitted to be taken by it under or in connection with any
Credit Document, except for its own gross negligence or willful
misconduct. The Administrative Agent and the Collateral Agent
may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents
or attorneys-in-fact selected by it with reasonable care.
10.2 Reliance by Administrative Agent and the Collateral
Agent.
The Administrative Agent and the Collateral Agent shall be
entitled to rely upon any certification, notice, instrument,
writing, or other communication (including, without limitation,
any thereof by telephone or telecopy) believed by it to be
genuine and correct and to have been signed, sent or made by or
on behalf of the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel for Alchem or any
Credit Party), independent accountants, and other experts
selected by the Administrative Agent. The Administrative Agent
may deem and treat the payee of any Note as the holder thereof
for all purposes hereof unless and until the Administrative Agent
receives and accepts an Assignment and Acceptance executed in
accordance with Section 11.3(b) hereof. As to any matters not
expressly provided for by this Credit Agreement, neither the
Administrative Agent nor the Collateral Agent shall be required
to exercise any discretion or take any action, but shall each be
required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the
instructions of the Required Lenders, and such instructions shall
be binding on all of the Lenders; provided, however, that neither
the Administrative Agent nor the Collateral Agent shall be
required to take any action that exposes such Person to personal
liability or that is contrary to any Credit Document or
applicable law or unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking any such
action.
10.3 Defaults.
Neither the Administrative Agent nor the Collateral Agent
shall be deemed to have knowledge or notice of the occurrence of
a Default or Eveynt of Default unless such Person has received
written notice from a Lender or the Borrower specifying such
Default or Event of Default and stating that such notice is a
"Notice of Default". In the event that the Administrative Agent
or the Collateral Agent receives such a notice of the occurrence
of a Default or Event of Default, such Person receiving notice
shall promptly notify the Lenders thereof. The Administrative
Agent or the Collateral Agent shall each (subject to Section 10.2
hereof) take such action with respect to such Default or Event of
Default as shall reasonably be directed by the Required Lenders,
provided that, unless and until the Administrative Agent or the
Collateral Agent shall have received such directions, such Person
may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the
Lenders.
10.4 Rights as a Lender.
With respect to its Commitment and the Loans made by it,
each of NationsBank (and any successor acting as Administrative
Agent) and BNY Financial (and any successor acting as Collateral
Agent) in its capacity as a Lender hereunder shall have the same
rights and powers hereunder as any other Lender and may exercise
the same as though it were not acting as the Administrative Agent
or the Collateral Agent (as applicable), and the term "Lender" or
"Lenders" shall, unless the context otherwise indicates, include
each of the Administrative Agent and the Collateral Agent in its
individual capacity. NationsBank (and any successor acting as
Administrative Agent) and its Affiliates and BNY Financial (and
any successor acting as Collateral Agent) and its Affiliates may
(without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide
services to, and generally engage in any kind of lending, trust,
or other business with any Credit Party or any of its
Subsidiaries or Affiliates as if it were not acting as
Administrative Agent or the Collateral Agent (as applicable), and
NationsBank (and any successor acting as Administrative Agent)
and its Affiliates and BNY Financial (and any successor acting as
Collateral Agent) and its Affiliates may accept fees and other
consideration from any Credit Party or any of its Subsidiaries or
Affiliates for services in connection with this Credit Agreement
or otherwise without having to account for the same to the
Lenders.
10.5 Indemnification.
The Lenders agree to indemnify the Administrative Agent and
the Collateral Agent (to the extent not reimbursed under Section
11.5 hereof, but without limiting the obligations of the Borrower
under such Section) ratably in accordance with their respective
Commitments, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses
(including attorneys' fees), or disbursements of any kind and
nature whatsoever that may be imposed on, incurred by or asserted
against the Administrative Agent or the Collateral Agent, as the
case may be (including by any Lender) in any way relating to or
arising out of any Credit Document or the transactions
contemplated thereby or any action taken or omitted by the
Administrative Agent or the Collateral Agent, as the case may be,
under any Credit Document; provided that no Lender shall be
liable for any of the foregoing to the extent they arise from the
gross negligence or willful misconduct of the Person to be
indemnified. Without limitation of the foregoing, each Lender
agrees to reimburse the Administrative Agent or the Collateral
Agent, as the case may be, promptly upon demand for its ratable
share of any costs or expenses payable by the Borrower under
Section 11.5, to the extent that the Administrative Agent or the
Collateral Agent, as the case may be, is not promptly reimbursed
for such costs and expenses by the Borrower. The agreements in
this Section 10.5 shall survive the repayment of the Loans, LOC
Obligations and other obligations under the Credit Documents and
the termination of the Commitments hereunder.
10.6 Non-Reliance on Administrative Agent, Collateral Agent
and Other Lenders.
Each Lender agrees that it has, independently and without
reliance on the Administrative Agent, the Collateral Agent or any
other Lender, and based on such documents and information as it
has deemed appropriate, made its own credit analysis of the
Credit Parties and their Subsidiaries and Affiliates and made its
own decision to enter into this Credit Agreement and that it
will, independently and without reliance upon the Administrative
Agent, the Collateral Agent or any other Lender, and based on
such documents and information as it shall deem appropriate at
the time, continue to make its own analysis and decisions in
taking or not taking action under the Credit Documents. Except
for notices, reports, and other documents and information
expressly required to be furnished hereunder to the Lenders by
the Administrative Agent or the Collateral Agent, as the case may
be, such Person shall not have any duty or responsibility to
provide any Lender with any credit or other information
concerning the affairs, financial condition, or business of any
Credit Party or any of its Subsidiaries or Affiliates that may
come into the possession of the Administrative Agent, the
Collateral Agent or any of their Affiliates.
10.7 Successor Administrative Agent.
The Administrative Agent and the Collateral Agent may each
resign at any time by giving notice thereof to the Lenders and
the Borrower (each a "Retiring Agent"). Upon any such
resignation, the Required Lenders shall have the right to appoint
a successor Administrative Agent or the Collateral Agent, as the
case may be. If no successor Administrative Agent or Collateral
Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within thirty (30) days
after the Retiring Agent's giving of notice of resignation, then
the Retiring Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent or the Collateral Agent, as the
case may be, which shall be a commercial bank organized under the
laws of the United States of America having combined capital and
surplus of at least $100,000,000. Upon the acceptance of any
appointment as Administrative Agent or the Collateral Agent
hereunder by a successor, such successor shall thereupon succeed
to and become vested with all the rights, powers, discretion,
privileges, and duties of the Retiring Agent, and the Retiring
Agent shall be discharged from its duties and obligations
hereunder. After any Retiring Agent's resignation hereunder as
Administrative Agent or Collateral Agent, as the case may be, the
provisions of this Section 10 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by
it while it was acting as Administrative Agent or Collateral
Agent, as the case may be.
SECTION 11
MISCELLANEOUS
11.1 Notices.
Except as otherwise expressly provided herein, all notices
and other communications shall have been duly given and shall be
effective (a) when delivered, (b) upon acknowledgement of
receipt, when transmitted via telecopy (or other facsimile
device) to the number set out below, (c) the Business Day
following the day on which the same has been delivered prepaid to
a reputable national overnight air courier service, or (d) the
third Business Day following the day on which the same is sent by
certified or registered mail, postage prepaid, in each case to
the respective parties at the address, in the case of the
Borrower, Guarantors and the Administrative Agent, set forth
below, and, in the case of the Lenders, set forth on Schedule
2.1(a), or at such other address as such party may specify by
written notice to the other parties hereto:
if to the Borrower or the Guarantors:
Delta Xxxxx, Inc.
0000 Xxxxx Xxxxx Xxxxxx
Post Office Xxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx
Telephone: 000-000-0000
Telecopy: 803-637-6066)
with a copy to:
Xxxx X. Xxxxxxx, Esq.
Wyche, Burgess, Xxxxxxx & Xxxxxx, P.A.
00 Xxxx Xxxxxxxxxx Xxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Xxxx Xxxxxx Xxx 000 (00000-0000)
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
if to the Administrative Agent:
NationsBank, N.A.
Independence Center, 15th Floor
NC1-001-15-04
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Agency Services
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
NationsBank, N.A.
NationsBank Corporate Center, 8th Floor
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: X. Xxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
11.2 Right of Set-Off; Adjustments.
Upon the occurrence and during the continuance of any Event
of Default, each Lender (and each of its Affiliates) is hereby
authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing
by such Lender (or any of its Affiliates) to or for the credit or
the account of any Credit Party against any and all of the
obligations of such Person now or hereafter existing under this
Credit Agreement, under the Notes, under any other Credit
Document or otherwise, irrespective of whether such Lender shall
have made any demand under hereunder or thereunder and although
such obligations may be unmatured. Each Lender agrees promptly
to notify any affected Credit Party after any such set-off and
application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such
set-off and application. The rights of each Lender under this
Section 11.2 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) that
such Lender may have.
11.3 Benefit of Agreement.
(a) This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto; provided that
none of the Credit Parties may assign or transfer any of its
interests and obligations without prior written consent of
the Lenders; provided further that the rights of each Lender
to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth
in this Section 11.3.
(b) Each Lender may assign to one or more Eligible
Assignees all or a portion of its rights and obligations
under this Credit Agreement (including, without limitation,
all or a portion of its Loans, its Notes, and its
Commitment); provided, however, that
(i) each such assignment shall be to an
Eligible Assignee;
(ii) except in the case of an assignment to
another Lender or an assignment of all of a Lender's
rights and obligations under this Credit Agreement, any
such partial assignment shall be in an amount at least
equal to $5,000,000 (or, if less, the remaining amount
of the Commitment being assigned by such Lender) or an
integral multiple of $1,000,000 in excess thereof;
(iii) each such assignment by a Lender
shall be of a constant, and not varying, percentage of
all of its rights and obligations under this Credit
Agreement and the Notes; and
(iv) the parties to such assignment shall
execute and deliver to the Administrative Agent for its
acceptance an Assignment and Acceptance in the form of
Exhibit 11.3(b) hereto, together with any Note subject
to such assignment and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment
and Acceptance, the assignee thereunder shall be a party
hereto and, to the extent of such assignment, have the
obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such
assignment, relinquish its rights and be released from its
obligations under this Credit Agreement. Upon the
consummation of any assignment pursuant to this Section
11.3(b), the assignor, the Administrative Agent and the
Borrower shall make appropriate arrangements so that, if
required, new Notes are issued to the assignor and the
assignee. If the assignee is not incorporated under the
laws of the United States of America or a state thereof, it
shall deliver to the Borrower and the Administrative Agent
certification as to exemption from deduction or withholding
of Taxes in accordance with Section 3.11.
(c) The Administrative Agent shall maintain at its
address referred to in Section 11.1 a copy of each
Assignment and Acceptance delivered to and accepted by it
and a register for the recordation of the names and
addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from
time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Administrative Agent
and the Lenders may treat each Person whose name is recorded
in the Register as a Lender hereunder for all purposes of
this Credit Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance
executed by the parties thereto, together with any Note
subject to such assignment and payment of the processing
fee, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the
form of Exhibit 11.3(b) hereto, (i) accept such Assignment
and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof
to the parties thereto.
(e) Each Lender may sell participations to one or more
Persons in all or a portion of its rights and obligations
under this Credit Agreement (including all or a portion of
its Commitment and its Loans); provided, however, that (i)
such Lender's obligations under this Credit Agreement shall
remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance
of such obligations, (iii) the participant shall be
entitled to the benefit of the yield protection provisions
contained in Sections 3.7 through 3.12, inclusive, and the
right of set-off contained in Section 11.2, and (iv) the
Borrower shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and
obligations under this Credit Agreement, and such Lender
shall retain the sole right to enforce the obligations of
the Borrower relating to its Loans and its Notes and to
approve any amendment, modification, or waiver of any
provision of this Credit Agreement (other than amendments,
modifications, or waivers decreasing the amount of principal
of or the rate at which interest is payable on such Loans or
Note, extending any scheduled principal payment date or date
fixed for the payment of interest on such Loans or Note, or
extending its Commitment).
(f) Notwithstanding any other provision set forth in
this Credit Agreement, any Lender may at any time assign and
pledge all or any portion of its Loans and its Notes to any
Federal Reserve Bank as collateral security pursuant to
Regulation A and any Operating Circular issued by such
Federal Reserve Bank. No such assignment shall release the
assigning Lender from its obligations hereunder.
(g) Any Lender may furnish any information concerning
the Borrower or any of its Subsidiaries in the possession of
such Lender from time to time to assignees and participants
(including prospective assignees and participants), subject,
however, to the provisions of Section 11.14 hereof.
11.4 No Waiver; Remedies Cumulative.
No failure or delay on the part of the Administrative Agent
or any Lender in exercising any right, power or privilege
hereunder or under any other Credit Document and no course of
dealing between the Administrative Agent or any Lender and Alchem
and any of the Credit Parties shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The
rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative
Agent or any Lender would otherwise have. No notice to or demand
on Alchem or any Credit Party in any case shall entitle Alchem or
any other Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the
rights of the Administrative Agent or the Lenders to any other or
further action in any circumstances without notice or demand.
11.5 Expenses; Indemnification.
(a) The Borrower agrees to pay on demand all
reasonable costs and expenses of the Administrative Agent
and the Collateral Agent in connection with the syndication,
preparation, execution, delivery, administration,
modification, and amendment of this Credit Agreement, the
other Credit Documents, and the other documents to be
delivered hereunder, including, without limitation, the
reasonable fees and expenses of counsel for the
Administrative Agent and the Collateral Agent (including the
cost of internal counsel) with respect thereto and with
respect to advising the Administrative Agent and the
Collateral Agent as to their respective rights and
responsibilities under the Credit Documents. The Borrower
further agrees to pay on demand all reasonable costs and
expenses of the Administrative Agent, the Collateral Agent
and the Lenders, if any (including, without limitation,
reasonable attorneys' fees and expenses and the cost of
internal counsel), in connection with the enforcement
(whether through negotiations, legal proceedings, or
otherwise) of the Credit Documents and the other documents
to be delivered hereunder.
(b) The Borrower agrees to indemnify and hold harmless
the Administrative Agent and each Lender and each of their
Affiliates and their respective officers, directors,
employees, agents, and advisors (each, an "Indemnified
Party") from and against any and all claims, damages,
losses, liabilities, costs, and expenses (including, without
limitation, reasonable attorneys' fees) that may be incurred
by or asserted or awarded against any Indemnified Party, in
each case arising out of or in connection with or by reason
of (including, without limitation, in connection with any
investigation, litigation, or proceeding or preparation of
defense in connection therewith) the Credit Documents, any
of the transactions contemplated herein or the actual or
proposed use of the proceeds of the Loans, except to the
extent such claim, damage, loss, liability, cost, or expense
is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct.
In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 11.5
applies, such indemnity shall be effective whether or not
such investigation, litigation or proceeding is brought by
the Borrower, its directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified
Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. The
Borrower agrees not to assert any claim against the
Administrative Agent, the Collateral Agent, any Lender, any
of their Affiliates, or any of their respective directors,
officers, employees, attorneys, agents, and advisers, on any
theory of liability, for special, indirect, consequential,
or punitive damages arising out of or otherwise relating to
the Credit Documents, any of the transactions contemplated
herein or the actual or proposed use of the proceeds of the
Loans. The Administrative Agent, the Collateral Agent and
the Lenders agree not to assert any claim against any of the
Credit Parties, or any of their respective directors,
officers, employees, attorneys, agents, and advisers, on any
theory of liability, for special, indirect, consequential,
or punitive damages arising out of or otherwise relating to
the Credit Documents or any of the transactions contemplated
herein.
(c) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 11.5
shall survive the repayment of the Loans, LOC Obligations
and other obligations under the Credit Documents and the
termination of the Commitments hereunder.
11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement nor any other Credit Document
nor any of the terms hereof or thereof may be amended, changed,
waived, discharged or terminated unless such amendment, change,
waiver, discharge or termination is in writing entered into by,
or approved in writing by, the Required Lenders and the Borrower,
provided, however, that:
(a) without the consent of each Lender affected
thereby, neither this Credit Agreement nor any other Credit
Document may be amended to
(i) extend the final maturity of any Loan or
the time of payment of any reimbursement obligation, or
any portion thereof, arising from drawings under
Letters of Credit,
(ii) reduce the rate or extend the time of
payment of interest (other than as a result of waiving
the applicability of any post-default increase in
interest rates) thereon or Fees hereunder,
(iii) reduce or waive the principal
amount of any Loan or of any reimbursement obligation,
or any portion thereof, arising from drawings under
Letters of Credit,
(iv) increase the Commitment of a Lender over
the amount thereof in effect (it being understood and
agreed that a waiver of any Default or Event of Default
or mandatory reduction in the Commitments shall not
constitute a change in the terms of any Commitment of
any Lender),
(v) except as the result of or in connection
with an Asset Disposition permitted by Section 8.5,
release all or substantially all of the Collateral,
(vi) except as the result of or in connection
with a dissolution, merger or disposition of a
Subsidiary permitted under Section 8.4, release the
Borrower or substantially all of the other Credit
Parties from its or their obligations under the Credit
Documents,
(vii) amend, modify or waive any
provision of this Section 11.6 or Section 3.6, 3.7,
3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 9.1(a),
11.2, 11.3, 11.5 or 11.9,
(viii) reduce any percentage specified in,
or otherwise modify, the definition of Required
Lenders, or
(ix) consent to the assignment or transfer by
the Borrower or all or substantially all of the other
Credit Parties of any of its or their rights and
obligations under (or in respect of) the Credit
Documents except as permitted thereby;
(b) without the consent of the Administrative Agent,
no provision of Section 10 may be amended;
(c) without the consent of the Issuing Lenders, no
provision of Section 2.2 may be amended; and
(d) without the consent of the Swingline Lender, no
provision of Section 2.3 may be amended.
Notwithstanding the fact that the consent of all the Lenders
is required in certain circumstances as set forth above, (x)
each Lender is entitled to vote as such Lender sees fit on
any bankruptcy reorganization plan that affects the Loans,
and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous
consent provisions set forth herein and (y) the Required
Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency
proceeding.
11.7 Counterparts.
This Credit Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall
be an original, but all of which shall constitute one and the
same instrument. It shall not be necessary in making proof of
this Credit Agreement to produce or account for more than one
such counterpart for each of the parties hereto. Delivery by
facsimile by any of the parties hereto of an executed counterpart
of this Credit Agreement shall be as effective as an original
executed counterpart hereof and shall be deemed a representation
that an original executed counterpart hereof will be delivered.
11.8 Headings.
The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the
meaning or construction of any provision of this Credit
Agreement.
11.9 Survival.
All indemnities set forth herein, including, without
limitation, in Section 2.2(i), 3.11, 3.12, 10.5 or 11.5 shall
survive the execution and delivery of this Credit Agreement, the
making of the Loans, the issuance of the Letters of Credit, the
repayment of the Loans, LOC Obligations and other obligations
under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the
Credit Parties herein shall survive delivery of the Notes and the
making of the Loans hereunder.
11.10 Governing Law; Submission to Jurisdiction; Venue.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NORTH CAROLINA. Any legal action or proceeding with respect
to this Credit Agreement or any other Credit Document may be
brought in the courts of the State of North Carolina in
Mecklenburg County, or of the United States for the Western
District of North Carolina, and, by execution and delivery
of this Credit Agreement, each of the Credit Parties hereby
irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the nonexclusive
jurisdiction of such courts. Each of the Credit Parties
further irrevocably consents to the service of process out
of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to it at the address set
out for notices pursuant to Section 11.1, such service to
become effective three (3) days after such mailing. Nothing
herein shall affect the right of the Administrative Agent or
any Lender to serve process in any other manner permitted by
law or to commence legal proceedings or to otherwise proceed
against any Credit Party in any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably
waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Credit
Agreement or any other Credit Document brought in the courts
referred to in subsection (a) above and hereby further
irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE
ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE LENDERS, THE
BORROWER AND THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT
AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.11 Severability.
If any provision of any of the Credit Documents is
determined to be illegal, invalid or unenforceable, such
provision shall be fully severable and the remaining provisions
shall remain in full force and effect and shall be construed
without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 Entirety.
This Credit Agreement together with the other Credit
Documents represent the entire agreement of the parties hereto
and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
11.13 Binding Effect; Termination.
(a) This Credit Agreement shall become effective at
such time on or after the Closing Date when it shall have
been executed by the Borrower, the Guarantors and the
Administrative Agent, and the Administrative Agent shall
have received copies hereof (telefaxed or otherwise) which,
when taken together, bear the signatures of each Lender, and
thereafter this Credit Agreement shall be binding upon and
inure to the benefit of the Borrower, the Guarantors, the
Administrative Agent and each Lender and their respective
successors and assigns.
(b) The term of this Credit Agreement shall be until
no Loans, LOC Obligations or any other amounts payable
hereunder or under any of the other Credit Documents shall
remain outstanding, no Letters of Credit shall be
outstanding, all of the Credit Party Obligations have been
irrevocably satisfied in full and all of the Commitments
hereunder shall have expired or been terminated.
11.14 Confidentiality.
The Administrative Agent and each Lender (each, a "Lending
Party") agrees to keep confidential any information furnished or
made available to it by the Borrower pursuant to this Credit
Agreement that is marked confidential; provided that nothing
herein shall prevent any Lending Party from disclosing such
information (a) to any other Lending Party or any Affiliate of
any Lending Party, or any officer, director, employee, agent, or
advisor of any Lending Party or Affiliate of any Lending Party,
(b) to any other Person if reasonably incidental to the
administration of the credit facility provided herein, (c) as
required by any law, rule, or regulation, (d) upon the order of
any court or administrative agency, (e) upon the request or
demand of any regulatory agency or authority, (f) that is or
becomes available to the public or that is or becomes available
to any Lending Party other than as a result of a disclosure by
any Lending Party prohibited by this Credit Agreement, (g) in
connection with any litigation to which such Lending Party or any
of its Affiliates may be a party, (h) to the extent necessary in
connection with the exercise of any remedy under this Credit
Agreement or any other Credit Document, and (i) subject to
provisions substantially similar to those contained in this
Section 11.14, to any actual or proposed participant or assignee.
11.15 Conflict.
To the extent that there is a conflict or inconsistency
between any provision hereof, on the one hand, and any provision
of any Credit Document, on the other hand, this Credit Agreement
shall control.
[Signature Pages to Follow]
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Credit Agreement to be duly executed and
delivered as of the date first above written.
BORROWER: DELTA XXXXX, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President,
Treasurer and Chief Financial Officer
GUARANTOR: DELTA XXXXX MARKETING, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President,
Treasurer and Chief Financial Officer
[Signatures Continued]
LENDERS: NATIONSBANK, N.A.
By: /s/ X. Xxxxxx Xxxxx
Name: X. Xxxxxx Xxxxx
Title: Senior Vice President
BNY FINANCIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: President
GENERAL ELECTRIC
CAPITAL CORPORATION
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President, Manager
Commercial Finance
COOPERATIEVE CENTRALE
RAIFFEISEN-BOERENLEENBANK B.A.,
"RABOBANK NEDERLAND",
NEW YORK BRANCH
By: /s/ Xxxxxxxx x. Xxx
Name: Xxxxxxxx X. Xxx
Title: Vice President
By: /s/ W. Xxxxxxx Xxxxxxx
Name: W. Xxxxxxx Xxxxxxx
Title: Vice President
[Signatures Continued]
ADMINISTRATIVE
AGENT: NATIONSBANK, N.A.
By: /s/ X. Xxxxxx Xxxxx
Name: X. Xxxxxx Xxxxx
Title: Senior Vice President
COLLATERAL
AGENT: BNY FINANCIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: President
Exhibit 1.1A
FORM OF PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Pledge Agreement") is entered
into as of August 25, 1997 among DELTA XXXXX, INC., a Delaware
corporation (the "Borrower"), ALCHEM CAPITAL CORPORATION, a
Delaware corporation (the "Parent"), certain Subsidiaries of the
Borrower (individually a "Guarantor", and collectively the
"Guarantors"; together with the Borrower and the Parent,
individually a "Pledgor", and collectively the "Pledgors") and
BNY FINANCIAL CORPORATION (the "Collateral Agent") for the
lenders from time to time party to the Credit Agreement described
below (the "Lenders"); and NATIONSBANK, N.A., in its capacity as
administrative agent (in such capacity, the "Administrative
Agent"; together with the Collateral Agent, the "Agents") for the
Lenders.
RECITALS
WHEREAS, pursuant to that certain Credit Agreement dated as
of the date hereof (as amended, modified, extended, renewed or
replaced from time to time, the "Credit Agreement") among the
Borrower, the Guarantors, the Lenders, the Administrative Agent
and the Collateral Agent, the Lenders have agreed to make Loans
and issue Letters of Credit upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the effectiveness of
the Credit Agreement and the obligations of the Lenders to make
their respective Loans and to issue Letters of Credit under the
Credit Agreement that the Pledgors shall have executed and
delivered this Pledge Agreement to the Agent for the ratable
benefit of the Lenders.
NOW, THEREFORE, in consideration of these premises and other
good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as
follows:
1. Definitions. Unless otherwise defined herein,
capitalized terms used herein shall have the meanings ascribed to
such terms in the Credit Agreement. For purposes of this Pledge
Agreement, the term "Lender" shall include any Issuing Lender.
2. Pledge and Grant of Security Interest. To secure the
prompt payment and performance in full when due, whether by lapse
of time or otherwise, of the Pledgor Obligations (as defined in
Section 3 hereof), each Pledgor hereby pledges and assigns to the
Collateral Agent, for the benefit of the Lenders, and grants to
the Collateral Agent, for the benefit of the Lenders, a
continuing security interest in any and all right, title and
interest of such Pledgor in and to the following, whether now
owned or existing or owned, acquired, or arising hereafter
(collectively, the "Pledged Collateral"):
(a) Pledged Shares. (i) 100% (or, if less, the
full amount owned by such Pledgor) of the issued and
outstanding shares of capital stock owned by such Pledgor of
each Domestic Subsidiary set forth on Schedule 2(a) attached
hereto and (ii) 65% (or, if less, the full amount owned by
such Pledgor) of the issued and outstanding shares of each
class of capital stock or other ownership interests entitled
to vote (within the meaning of Treas. Reg. Section 1.956-
2(c)(2)) ("Voting Equity") and 100% (or, if less, the full
amount owned by such Pledgor) of the issued and outstanding
shares of each class of capital stock or other ownership
interests not entitled to vote (within the meaning of Treas.
Reg. Section 1.956-2(c)(2)) ("Non-Voting Equity") owned by
such Pledgor of each Foreign Subsidiary set forth on
Schedule 2(a) attached hereto, in each case together with
the certificates (or other agreements or instruments), if
any, representing such shares, and all options and other
rights, contractual or otherwise, with respect thereto
(collectively, together with the shares of capital stock
described in Section 2(b) and 2(c) below, the "Pledged
Shares"), including, but not limited to, the following:
(y) all shares or securities representing a
dividend on any of the Pledged Shares, or representing
a distribution or return of capital upon or in respect
of the Pledged Shares, or resulting from a stock split,
revision, reclassification or other exchange therefor,
and any subscriptions, warrants, rights or options
issued to the holder of, or otherwise in respect of,
the Pledged Shares; and
(z) without affecting the obligations of
such Pledgor under any provision prohibiting such
action hereunder, in the event of any consolidation or
merger in which a Pledgor is not the surviving
corporation, all shares of each class of the capital
stock of the successor corporation formed by or
resulting from such consolidation or merger.
(b) Additional Shares. 100% (or, if less, the full
amount owned by such Pledgor) of the issued and outstanding
shares of capital stock owned by such Pledgor of any Person
which hereafter becomes a Domestic Subsidiary and 65% (or,
if less, the full amount owned by such Pledgor) of the
Voting Equity and 100% (or, if less, the full amount owned
by such Pledgor) of the Non-Voting Equity owned by such
Pledgor of any Person which hereafter becomes a Foreign
Subsidiary, including, without limitation, the certificates
representing such shares.
(c) Other Equity Interests. Any and all other Capital
Stock of each Pledgor in any Domestic Subsidiary or any
Foreign Subsidiary.
(d) Proceeds. All proceeds of the foregoing, however
and whenever acquired and in whatever form.
Without limiting the generality of the foregoing, it is
hereby specifically understood and agreed that a Pledgor may from
time to time hereafter deliver additional shares of stock to the
Collateral Agent as collateral security for the Pledgor
Obligations. Upon delivery to the Collateral Agent, such
additional shares of stock shall be deemed to be part of the
Pledged Collateral of such Pledgor and shall be subject to the
terms of this Pledge Agreement whether or not Schedule 2(a) is
amended to refer to such additional shares.
3. Security for Pledgor Obligations. The security
interest created hereby in the Pledged Collateral of each Pledgor
constitutes continuing collateral security for all of the
following, whether now existing or hereafter incurred (the
"Pledgor Obligations"):
(a) In the case of the Borrower, the prompt
performance and observance by the Borrower of all
obligations of the Borrower under the Credit Agreement, the
Notes, this Pledge Agreement and the other Credit Documents
to which the Borrower is a party;
(b) In the case of the Guarantors, the prompt
performance and observance by such Guarantor of all
obligations of such Guarantor under the Credit Agreement,
this Pledge Agreement and the other Credit Documents to
which such Guarantor is a party, including, without
limitation, its guaranty obligations arising under Section 4
of the Credit Agreement;
(c) In the case of the Parent, (i) the prompt
performance and observance by the Borrower of all
obligations of the Borrower under the Credit Agreement, the
Notes, this Pledge Agreement and the other Credit Documents
to which the Borrower is a party and (ii) the prompt
performance and observance by the Parent of all obligations
of the Pledgor under the this Pledge Agreement; and
(d) All other indebtedness, liabilities and
obligations of any kind or nature owing from any Pledgor to
any Lender or the Agent arising under the Credit Agreement
or the other Credit Documents, and all obligations and
liabilities incurred in connection with collecting and
enforcing the Pledgor Obligations.
4. Delivery of the Pledged Collateral. Each Pledgor
hereby agrees that:
(a) Each Pledgor shall deliver to the Collateral Agent
(i) simultaneously with or prior to the execution and
delivery of this Pledge Agreement, all certificates
representing the Pledged Shares of such Pledgor and (ii)
promptly upon the receipt thereof by or on behalf of a
Pledgor, all other certificates and instruments constituting
Pledged Collateral of a Pledgor. Prior to delivery to the
Collateral Agent, all such certificates and instruments
constituting Pledged Collateral of a Pledgor shall be held
in trust by such Pledgor for the benefit of the Collateral
Agent pursuant hereto. All such certificates shall be
delivered in suitable form for transfer by delivery or shall
be accompanied by duly executed instruments of transfer or
assignment in blank, with signature guaranties substantially
in the form provided in Exhibit 4(a) attached hereto.
(b) Additional Securities. If such Pledgor shall
receive by virtue of its being or having been the owner of
any Pledged Collateral, any (i) stock certificate, including
without limitation, any certificate representing a stock
dividend or distribution in connection with any increase or
reduction of capital, reclassification, merger,
consolidation, sale of assets, combination of shares, stock
splits, spin-off or split-off, promissory notes or other
instrument; (ii) option or right, whether as an addition to,
substitution for, or an exchange for, any Pledged Collateral
or otherwise; (iii) dividends payable in securities; or
(iv) distributions of securities in connection with a
partial or total liquidation, dissolution or reduction of
capital, capital surplus or paid-in surplus, then such
Pledgor shall receive such stock certificate, instrument,
option, right or distribution in trust for the benefit of
the Collateral Agent, shall segregate it from such Pledgor's
other property and shall deliver it forthwith to the
Collateral Agent in the exact form received together with
any necessary endorsement and/or appropriate stock power
duly executed in blank, substantially in the form provided
in Exhibit 4(a), to be held by the Collateral Agent as
Pledged Collateral and as further collateral security for
the Pledgor Obligations.
(c) Financing Statements. Each Pledgor shall execute
and deliver to the Administrative Agent such UCC or other
applicable financing statements as may be reasonably
requested by the Administrative Agent in order to perfect
and protect the security interest of the Collateral Agent
created hereby in the Pledged Collateral of such Pledgor.
5. Representations and Warranties. Each Pledgor hereby
represents and warrants to the Agents, for the benefit of the
Lenders, that so long as any of the Pledgor Obligations remain
outstanding or any Credit Document is in effect or any Letter of
Credit shall remain outstanding, and until all of the Commitments
shall have been terminated:
(a) Authorization of Pledged Shares. The Pledged
Shares are duly authorized and validly issued, are fully
paid and nonassessable and are not subject to the preemptive
rights of any Person. All other shares of stock
constituting Pledged Collateral will be duly authorized and
validly issued, fully paid and nonassessable and not subject
to the preemptive rights of any Person.
(b) Title. Each Pledgor has good and indefeasible
title to the Pledged Collateral of such Pledgor and will at
all times be the legal and beneficial owner of such Pledged
Collateral free and clear of any Lien, other than Permitted
Liens. There exists no "adverse claim" within the meaning
of Section 8-302 of the Uniform Commercial Code as in effect
in the State of North Carolina (the "UCC") with respect to
the Pledged Shares of such Pledgor.
(c) Exercising of Rights. The exercise by the Agents
of their rights and remedies hereunder will not violate any
law or governmental regulation or any material contractual
restriction binding on or affecting a Pledgor or any of its
property.
(d) Pledgor's Authority. No authorization, approval
or action by, and no notice or filing with any Governmental
Authority or with the issuer of any Pledged Stock is
required either (i) for the pledge made by a Pledgor or for
the granting of the security interest by a Pledgor pursuant
to this Pledge Agreement or (ii) for the exercise by the
Agents or the Lenders of their rights and remedies hereunder
(except as may be required by laws affecting the offering
and sale of securities).
(e) Security Interest/Priority. This Pledge Agreement
creates a valid security interest in favor of the Collateral
Agent for the benefit of the Lenders, in the Pledged
Collateral. The taking possession by the Collateral Agent
of the certificates representing the Pledged Shares and all
other certificates and instruments constituting Pledged
Collateral will perfect and establish the first priority of
the Collateral Agent's security interest in the Pledged
Shares and, when properly perfected by filing or
registration, in all other Pledged Collateral represented by
such Pledged Shares and instruments securing the Pledgor
Obligations. Except as set forth in this Section 5(e), no
action is necessary to perfect or otherwise protect such
security interest.
(f) No Other Shares. No Pledgor owns any shares of
stock other than as set forth on Schedule 2(a) attached
hereto.
6. Covenants. Each Pledgor hereby covenants, that so long
as any of the Pledgor Obligations remain outstanding or any
Credit Document is in effect or any Letter of Credit shall remain
outstanding, and until all of the Commitments shall have been
terminated, such Pledgor shall:
(a) Books and Records. Xxxx its books and records
(and shall cause the issuer of the Pledged Shares of such
Pledgor to xxxx its books and records) to reflect the
security interest granted to the Collateral Agent, for the
benefit of the Lenders, pursuant to this Pledge Agreement.
(b) Defense of Title. Warrant and defend title to and
ownership of the Pledged Collateral of such Pledgor at its
own expense against the claims and demands of all other
parties claiming an interest therein, keep the Pledged
Collateral free from all Liens, except for Permitted Liens,
and not sell, exchange, transfer, assign, lease or otherwise
dispose of Pledged Collateral of such Pledgor or any
interest therein, except as permitted under the Credit
Agreement and the other Credit Documents.
(c) Further Assurances. Promptly execute and deliver
at its expense all further instruments and documents and
take all further action that may be necessary and desirable
or that the Administrative Agent may reasonably request in
order to (i) perfect and protect the security interest of
the Collateral Agent created hereby in the Pledged
Collateral of such Pledgor (including without limitation any
and all action necessary to satisfy the Administrative Agent
that the Collateral Agent has obtained a first priority
perfected security interest in any capital stock); (ii)
enable the Agents to exercise and enforce their rights and
remedies hereunder in respect of the Pledged Collateral of
such Pledgor; and (iii) otherwise effect the purposes of
this Pledge Agreement, including, without limitation and if
requested by the Administrative Agent, delivering to the
Collateral Agent irrevocable proxies in respect of the
Pledged Collateral of such Pledgor.
(d) Amendments. Not make or consent to any amendment
or other modification or waiver with respect to any of the
Pledged Collateral of such Pledgor or enter into any
agreement or allow to exist any restriction with respect to
any of the Pledged Collateral of such Pledgor other than
pursuant hereto or as may be permitted under the Credit
Agreement.
(e) Compliance with Securities Laws. File all reports
and other information now or hereafter required to be filed
by such Pledgor with the United States Securities and
Exchange Commission and any other state, federal or foreign
agency in connection with the ownership of the Pledged
Collateral of such Pledgor.
7. Advances by Lenders. On failure of any Pledgor to
perform any of the covenants and agreements contained herein, the
Administrative Agent may, at its sole option and in its sole
discretion, or the Collateral Agent shall, at the direction of
the Administrative Agent, perform the same and in so doing may
expend such sums as the Administrative Agent may reasonably deem
advisable in the performance thereof, including, without
limitation, the payment of any insurance premiums, the payment of
any taxes, a payment to obtain a release of a Lien or potential
Lien, expenditures made in defending against any adverse claim
and all other expenditures which the Agents or the Lenders may
make for the protection of the security hereof or which may be
compelled to make by operation of law. All such sums and amounts
so expended shall be repayable by the Pledgors on a joint and
several basis promptly upon timely notice thereof and demand
therefor, shall constitute additional Pledgor Obligations and
shall bear interest from the date said amounts are expended at
the default rate specified in Section 3.1 of the Credit Agreement
for Base Rate Loans. No such performance of any covenant or
agreement by the Agents or the Lenders on behalf of any Pledgor,
and no such advance or expenditure therefor, shall relieve the
Pledgors of any default under the terms of this Pledge Agreement
or the other Credit Documents. The Lenders may make any payment
hereby authorized in accordance with any xxxx, statement or
estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of
such xxxx, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to
the extent such payment is being contested in good faith by a
Pledgor in appropriate proceedings and against which adequate
reserves are being maintained in accordance with GAAP.
8. Events of Default. The occurrence of an event which
under the Credit Agreement would constitute an Event of Default
shall be an Event of Default hereunder (an "Event of Default").
9. Remedies.
(a) General Remedies. Upon the occurrence of an Event
of Default and during the continuation thereof, the Agents
and the Lenders shall have, in respect of the Pledged
Collateral of any Pledgor, in addition to the rights and
remedies provided herein, in the Credit Documents or by law,
the rights and remedies of a secured party under the UCC or
any other applicable law.
(b) Sale of Pledged Collateral. Upon the occurrence
of an Event of Default and during the continuation thereof,
without limiting the generality of this Section and without
notice, the Collateral Agent shall, at the direction of the
Administrative Agent, sell or otherwise dispose of or
realize upon the Pledged Collateral, or any part thereof, in
one or more parcels, at public or private sale, at any
exchange or broker's board or elsewhere, at such price or
prices and on such other terms as the Administrative Agent
may deem commercially reasonable, for cash, credit or for
future delivery or otherwise in accordance with applicable
law. To the extent permitted by law, any Lender may in such
event, bid for the purchase of such securities. Each
Pledgor agrees that, to the extent notice of sale shall be
required by law and has not been waived by such Pledgor, any
requirement of reasonable notice shall be met if notice,
specifying the place of any public sale or the time after
which any private sale is to be made, is personally served
on or mailed, postage prepaid, to such Pledgor, in
accordance with the notice provisions of Section 11.1 of the
Credit Agreement at least 10 days before the time of such
sale. The Collateral Agent shall not be obligated to make
any sale of Pledged Collateral of such Pledgor regardless of
notice of sale having been given. The Collateral Agent at
the direction of the Administrative Agent may adjourn any
public or private sale from time to time by announcement at
the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to
which it was so adjourned.
(c) Private Sale. Upon the occurrence of an Event of
Default and during the continuation thereof, the Pledgors
recognize that the Administrative Agent may deem it
impracticable for the Collateral Agent to effect a public
sale of all or any part of the Pledged Shares or any of the
securities constituting Pledged Collateral and that the
Administrative Agent may, therefore, direct the Collateral
Agent to make one or more private sales of any such
securities to a restricted group of purchasers who will be
obligated to agree, among other things, to acquire such
securities for their own account, for investment and not
with a view to the distribution or resale thereof. Each
Pledgor acknowledges that any such private sale may be at
prices and on terms less favorable to the seller than the
prices and other terms which might have been obtained at a
public sale and, notwithstanding the foregoing, agrees that
such private sale shall be deemed to have been made in a
commercially reasonable manner and that the Agents shall
have no obligation to delay sale of any such securities for
the period of time necessary to permit the issuer of such
securities to register such securities for public sale under
the Securities Act of 1933. Each Pledgor further
acknowledges and agrees that any offer to sell such
securities which has been (i) publicly advertised on a bona
fide basis in a newspaper or other publication of general
circulation in the financial community of New York, New York
(to the extent that such offer may be advertised without
prior registration under the Securities Act of 1933), or
(ii) made privately in the manner described above shall be
deemed to involve a "public sale" under the UCC,
notwithstanding that such sale may not constitute a "public
offering" under the Securities Act of 1933, and either Agent
may, in such event, bid for the purchase of such securities.
(d) Retention of Pledged Collateral. In addition to
the rights and remedies hereunder, upon the occurrence of an
Event of Default, the Collateral Agent shall at the
direction of the Administrative Agent, after providing the
notices required by Section 9-505(2) of the UCC or otherwise
complying with the requirements of applicable law of the
relevant jurisdiction, retain all or any portion of the
Pledged Collateral in satisfaction of the Pledgor
Obligations. Unless and until the Collateral Agent shall
have provided such notices, however, the Collateral Agent
shall not be deemed to have retained any Pledged Collateral
in satisfaction of any Pledgor Obligations for any reason.
(e) Deficiency. In the event that the proceeds of any
sale, collection or realization are insufficient to pay all
amounts to which the Agents or the Lenders are legally
entitled, the Borrower and the Guarantors shall be jointly
and severally liable for the deficiency, together with
interest thereon at the default rate specified in Section
3.1 of the Credit Agreement for Base Rate Loans, together
with the costs of collection and the reasonable fees of any
attorneys employed by the Collateral Agent at the direction
of the Administrative Agent to collect such deficiency. Any
surplus remaining after the full payment and satisfaction of
the Pledgor Obligations shall be returned to the Pledgors or
to whomsoever a court of competent jurisdiction shall
determine to be entitled thereto.
10. Rights of the Agents.
(a) Power of Attorney. In addition to other powers of
attorney contained herein, each Pledgor hereby designates
and appoints the Collateral Agent, on behalf of the Lenders,
and each of its designees or agents as attorney-in-fact of
such Pledgor, irrevocably and with power of substitution,
with authority to take any or all of the following actions
upon the occurrence and during the continuance of an Event
of Default (the taking of any such action shall be at the
direction of the Administrative Agent):
(i) to demand, collect, settle,
compromise, adjust and give discharges and releases
concerning the Pledged Collateral of such Pledgor, all
as the Administrative Agent may reasonably determine;
(ii) to commence and prosecute any
actions at any court for the purposes of collecting any
of the Pledged Collateral of such Pledgor and enforcing
any other right in respect thereof;
(iii) to defend, settle or
compromise any action brought and, in connection
therewith, give such discharge or release as the
Administrative Agent may deem reasonably appropriate;
(iv) to pay or discharge taxes, liens,
security interests, or other encumbrances levied or
placed on or threatened against the Pledged Collateral
of such Pledgor;
(v) to direct any parties liable for
any payment under any of the Pledged Collateral to make
payment of any and all monies due and to become due
thereunder directly to the Administrative Agent or as
the Administrative Agent shall direct;
(vi) to receive payment of and receipt
for any and all monies, claims, and other amounts due
and to become due at any time in respect of or arising
out of any Pledged Collateral of such Pledgor;
(vii) to sign and endorse any
drafts, assignments, proxies, stock powers,
verifications, notices and other documents relating to
the Pledged Collateral of such Pledgor;
(viii) to settle, compromise or
adjust any suit, action or proceeding described above
and, in connection therewith, to give such discharges
or releases as the Administrative Agent may deem
reasonably appropriate;
(ix) execute and deliver all
assignments, conveyances, statements, financing
statements, renewal financing statements, pledge
agreements, affidavits, notices and other agreements,
instruments and documents that the Administrative Agent
may determine necessary in order to perfect and
maintain the security interests and liens granted in
this Pledge Agreement and in order to fully consummate
all of the transactions contemplated therein;
(x) to exchange any of the Pledged
Collateral of such Pledgor or other property upon any
merger, consolidation, reorganization, recapitalization
or other readjustment of the issuer thereof and, in
connection therewith, deposit any of the Pledged
Collateral of such Pledgor with any committee,
depository, transfer agent, registrar or other
designated agency upon such terms as the Administrative
Agent may determine;
(xi) to vote for a shareholder
resolution, or to sign an instrument in writing,
sanctioning the transfer of any or all of the Pledged
Shares of such Pledgor into the name of an Agent or one
or more of the Lenders or into the name of any
transferee to whom the Pledged Shares of such Pledgor
or any part thereof may be sold pursuant to Section 10
hereof; and
(xii) to do and perform all such
other acts and things as the Administrative Agent may
reasonably deem to be necessary, proper or convenient
in connection with the Pledged Collateral of such
Pledgor.
This power of attorney is a power coupled with an interest
and shall be irrevocable (i) for so long as any of the
Pledgor Obligations remain outstanding, any Credit Document
is in effect or any Letter of Credit shall remain
outstanding and (ii) until all of the Commitments shall have
been terminated. The Collateral Agent shall be under no
duty, unless directed by the Administrative Agent, to
exercise or withhold the exercise of any of the rights,
powers, privileges and options expressly or implicitly
granted to the Collateral Agent in this Pledge Agreement,
and shall not be liable for any failure to do so or any
delay in doing so. The Agents shall not be liable for any
act or omission or for any error of judgment or any mistake
of fact or law in their individual capacities or for the
Collateral Agent in its capacity as attorney-in-fact except
acts or omissions resulting from its gross negligence or
willful misconduct. This power of attorney is conferred on
the Collateral Agent solely to protect, preserve and realize
upon the Collateral Agent's security interest in Pledged
Collateral.
(b) Performance by the Collateral Agent of Pledgor's
Obligations. If any Pledgor fails to perform any agreement
or obligation contained herein, the Collateral Agent at the
direction of the Administrative Agent shall perform, or
cause performance of, such agreement or obligation, and the
expenses of the Agents incurred in connection therewith
shall be payable by the Borrower and Guarantors on a joint
and several basis pursuant to Section 13 hereof.
(c) Assignment by the Collateral Agent. The
Collateral Agent shall at the direction of the
Administrative Agent from time to time assign the Pledgor
Obligations and any portion thereof and/or the Pledged
Collateral and any portion thereof, and the assignee shall
be entitled to all of the rights and remedies of the
Collateral Agent under this Pledge Agreement in relation
thereto.
(d) Voting Rights in Respect of the Pledged
Collateral.
(i) So long as no Event of Default
shall have occurred and be continuing, to the extent
permitted by law, each Pledgor may exercise any and all
voting and other consensual rights pertaining to the
Pledged Collateral of such Pledgor or any part thereof
for any purpose not inconsistent with the terms of this
Pledge Agreement or the Credit Agreement; and
(ii) Upon the occurrence and during the
continuance of an Event of Default and the Collateral
Agent has given notice to the Pledgors that the
Collateral Agent has elected, at the direction of the
Required Lenders, to exercise its rights and remedies
under this Agreement all rights of a Pledgor to
exercise the voting and other consensual rights which
it would otherwise be entitled to exercise pursuant to
paragraph (i) of this Section shall cease and all such
rights shall thereupon become vested in the Collateral
Agent which shall then have the sole right to exercise
such voting and other consensual rights at the
direction of the Administrative Agent.
(e) Dividend Rights in Respect of the Pledged
Collateral.
(i) So long as no Event of Default
shall have occurred and be continuing and subject to
Section 4(b) hereof, each Pledgor may receive and
retain any and all dividends (other than stock
dividends and other dividends constituting Pledged
Collateral which are addressed hereinabove) or interest
paid in respect of the Pledged Collateral to the extent
they are allowed under the Credit Agreement.
(ii) Upon the occurrence and during the
continuance of an Event of Default:
(A) all rights of a Pledgor to
receive the dividends and interest payments which
it would otherwise be authorized to receive and
retain pursuant to paragraph (i) of this Section
shall cease and all such rights shall thereupon be
vested in the Collateral Agent which shall then
have the sole right to receive and hold as Pledged
Collateral, at the instruction of the
Administrative Agent, such dividends and interest
payments; and
(B) all dividends and interest
payments which are received by a Pledgor contrary
to the provisions of paragraph (A) of this Section
shall be received in trust for the benefit of the
Collateral Agent, shall be segregated from other
property or funds of such Pledgor, and shall be
forthwith paid over to the Collateral Agent as
Pledged Collateral in the exact form received, to
be held by the Collateral Agent at the direction
of the Administrative Agent as Pledged Collateral
and as further collateral security for the Pledgor
Obligations.
(f) Release of Pledged Collateral. The Collateral
Agent at the direction of the Administrative Agent shall
release any of the Pledged Collateral from this Pledge
Agreement or may substitute any of the Pledged Collateral
for other Pledged Collateral without altering, varying or
diminishing in any way the force, effect, lien, pledge or
security interest of this Pledge Agreement as to any Pledged
Collateral not expressly released or substituted, and this
Pledge Agreement shall continue as a first priority lien on
all Pledged Collateral not expressly released or
substituted.
11. Exercise of Remedies. Notwithstanding anything herein
to the contrary, each of the Agents shall exercise, or refrain
from exercising, its rights and remedies (including the right of
the Administrative Agent to direct the Collateral Agent to take,
or refrain from taking, action) only in accordance with the
instructions of the Required Lenders.
12. Rights of Required Lenders. All rights of the Agents
hereunder, if not exercised by the Agents, may be exercised by
the Required Lenders.
13. Application of Proceeds. Upon the occurrence and
during the continuance of an Event of Default, any payments in
respect of the Pledgor Obligations and any proceeds of any
Pledged Collateral, when received by an Agent or any of the
Lenders in cash or its equivalent, will be applied in reduction
of the Pledgor Obligations in the order set forth in Section
3.14(b) of the Credit Agreement, and each Pledgor irrevocably
waives the right to direct the application of such payments and
proceeds and acknowledges and agrees that the Administrative
Agent shall have the continuing and exclusive right to apply and
reapply any and all such payments and proceeds in the
Administrative Agent's sole discretion, notwithstanding any entry
to the contrary upon any of its books and records.
14. Costs of Counsel. At all times hereafter, the Borrower
and Guarantors agree to promptly pay upon demand any and all
reasonable costs and expenses of the Agents or the Lenders, (a)
as required under Section 11.5 of the Credit Agreement and (b) as
necessary to protect the Pledged Collateral or to exercise any
rights or remedies under this Pledge Agreement or with respect to
any Pledged Collateral. All of the foregoing costs and expenses
shall constitute Pledgor Obligations hereunder.
15. Continuing Agreement.
(a) This Pledge Agreement shall be a continuing
agreement in every respect and shall remain in full force
and effect so long as any of the Pledgor Obligations remain
outstanding or any Credit Document is in effect or any
Letter of Credit shall remain outstanding, and until all of
the Commitments thereunder shall have terminated (other than
any obligations with respect to the indemnities and the
representations and warranties set forth in the Credit
Documents). Upon such payment and termination, this Pledge
Agreement shall be automatically terminated and the Agents
and the Lenders shall, upon the request and at the expense
of the Pledgors, forthwith release all of their liens and
security interests hereunder and shall executed and deliver
all UCC termination statements and/or other documents
reasonably requested by the Pledgors evidencing such
termination. Notwithstanding the foregoing all releases and
indemnities provided hereunder shall survive termination of
this Pledge Agreement.
(b) This Pledge Agreement shall continue to be
effective or be automatically reinstated, as the case may
be, if at any time payment, in whole or in part, of any of
the Pledgor Obligations is rescinded or must otherwise be
restored or returned by either Agent or any Lender as a
preference, fraudulent conveyance or otherwise under any
bankruptcy, insolvency or similar law, all as though such
payment had not been made; provided that in the event
payment of all or any part of the Pledgor Obligations is
rescinded or must be restored or returned, all reasonable
costs and expenses (including without limitation any
reasonable legal fees and disbursements) incurred by either
Agent or any Lender in defending and enforcing such
reinstatement shall be deemed to be included as a part of
the Pledgor Obligations.
16. Amendments; Waivers; Modifications. This Pledge
Agreement and the provisions hereof may not be amended, waived,
modified, changed, discharged or terminated except as set forth
in Section 11.6 of the Credit Agreement.
17. Successors in Interest. This Pledge Agreement shall
create a continuing security interest in the Collateral and shall
be binding upon each Pledgor, its successors and assigns and
shall inure, together with the rights and remedies of the Agents
and the Lenders hereunder, to the benefit of the Agents and the
Lenders and their successors and permitted assigns; provided,
however, that none of the Pledgors may assign its rights or
delegate its duties hereunder without the prior written consent
of each Lender or the Required Lenders, as required by the Credit
Agreement. To the fullest extent permitted by law, each Pledgor
hereby releases each Agent and each Lender, and its successors
and assigns, from any liability for any act or omission relating
to this Pledge Agreement or the Collateral, except for any
liability arising from the gross negligence or willful misconduct
of such Agent, or such Lender, or its officers, employees or
agents.
18. Notices. All notices required or permitted to be given
under this Pledge Agreement shall be in conformance with
Section 11.1 of the Credit Agreement.
19. Counterparts. This Pledge Agreement may be executed in
any number of counterparts, each of which where so executed and
delivered shall be an original, but all of which shall constitute
one and the same instrument. It shall not be necessary in making
proof of this Pledge Agreement to produce or account for more
than one such counterpart.
20. Headings. The headings of the sections and subsections
hereof are provided for convenience only and shall not in any way
affect the meaning or construction of any provision of this
Pledge Agreement.
21. Governing Law; Submission to Jurisdiction; Venue.
(a) THIS PLEDGE AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NORTH CAROLINA. Any legal action or proceeding
with respect to this Security Agreement may be brought in
the courts of the State of North Carolina, or of the United
States for the Western District of North Carolina, and, by
execution and delivery of this Security Agreement, each
Pledgor hereby irrevocably accepts for itself and in respect
of its property, generally and unconditionally, the
jurisdiction of such courts. Each Pledgor further
irrevocably consents to the service of process out of any of
the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified
mail, postage prepaid, to it at the address for notices
pursuant to Section 11.1 of the Credit Agreement, such
service to become effective 30 days after such mailing.
Nothing herein shall affect the right of the Administrative
Agent or the Collateral Agent at the direction of the
Administrative Agent to serve process in any other manner
permitted by law or to commence legal proceedings or to
otherwise proceed against any Pledgor in any other
jurisdiction.
(b) Each Pledgor hereby irrevocably waives any
objection which it may now or hereafter have to the laying
of venue of any of the aforesaid actions or proceedings
arising out of or in connection with this Pledge Agreement
brought in the courts referred to in subsection (a) hereof
and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an
inconvenient forum.
22. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES TO THIS PLEDGE AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS PLEDGE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
23. Severability. If any provision of any of the Pledge
Agreement is determined to be illegal, invalid or unenforceable,
such provision shall be fully severable and the remaining
provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or
unenforceable provisions.
24. Entirety. This Pledge Agreement and the other Credit
Documents represent the entire agreement of the parties hereto
and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
25. Survival. All representations and warranties of the
Pledgors hereunder shall survive the execution and delivery of
this Pledge Agreement and the other Credit Documents, the
delivery of the Notes and the making of the Loans and the
issuance of the Letters of Credit under the Credit Agreement.
26. Other Security. To the extent that any of the Pledgor
Obligations are now or hereafter secured by property other than
the Pledged Collateral (including, without limitation, real and
other personal property owned by a Pledgor), or by a guarantee,
endorsement or property of any other Person, then the Agents and
the Lenders shall have the right to proceed against such other
property, guarantee or endorsement upon the occurrence of any
Event of Default, and the Administrative Agent and the Lenders
have the right, in their sole discretion, to determine which
rights, security, liens, security interests or remedies the
Agents and the Lenders shall at any time pursue, relinquish,
subordinate, modify or take with respect thereto, without in any
way modifying or affecting any of them or any of the Agents' and
the Lenders' rights or the Pledgor Obligations under this Pledge
Agreement or under any other of the Credit Documents.
27. Joint and Several Obligations of Parent; Limitation on
Liability.
(a) To the extent of its obligations arising under
this Pledge Agreement, the Parent is accepting joint and
several liability hereunder with the other Pledgors in
consideration of the financial accommodation to be provided
by the Lenders under the Credit Agreement.
(b) To the extent of its obligations arising under
this Pledge Agreement but only to the extent of the shares
pledged by the Parent, the Parent jointly and severally
hereby irrevocably and unconditionally accepts, not merely
as a surety but also as a co-debtor, joint and several
liability with the other Pledgors with respect to the
payment and performance of all of the Pledgor Obligations
arising under this Pledge Agreement and the other Credit
Documents.
(c) Notwithstanding any provision to the contrary
contained herein or in any other of the Credit Documents, to
the extent the obligations of a Guarantor shall be
adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable
state or federal law relating to fraudulent conveyances or
transfers) then the obligations of each Guarantor hereunder
shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and
including, without limitation, the Bankruptcy Code).
(d) Notwithstanding any provision to the contrary
contained herein or in any other Credit Document, the
Parent's liability is nonrecourse and shall be limited to
the Pledged Shares delivered by it hereunder. No deficiency
arising out of the Pledgor Obligations may be recovered
against the Parent.
28. Rights of Required Lenders. All rights of the Agents
hereunder, if not exercised by the Agents, may be exercised by
the Required Lenders. Notwithstanding anything herein to the
contrary, each of the Agents shall exercise, or refrain from
exercising, its rights and remedies (including the right of the
Administrative Agent to direct the Collateral Agent to take, or
refrain from taking, an action) only in accordance with the
instructions of the Required Lenders.
[remainder of page intentionally left blank]
Each of the parties hereto has caused a counterpart of this
Pledge Agreement to be duly executed and delivered as of the date
first above written.
BORROWER: DELTA XXXXX, INC.,
a Delaware corporation
By:
Name:
Title:
PARENT: ALCHEM CAPITAL CORPORATION,
a Delaware corporation
By:
Name:
Title:
GUARANTOR: DELTA XXXXX MARKETING, INC.,
a Delaware corporation
By:
Name:
Title:
Accepted and agreed to in Charlotte, North Carolina as of
the date first above written.
NATIONSBANK, N.A.
as Administrative Agent
By:
Name:
Title:
BNY FINANCIAL CORPORATION,
as Collateral Agent
By:
Name:
Title:
Schedule 2(a)
to
Pledge Agreement
dated as of August 25, 1997
in favor of NationsBank, N.A.
as Administrative Agent
and
BNY Financial Corporation
as Collateral Agent
PLEDGED STOCK
Pledgor: ALCHEM CAPITAL CORPORATION
Name of Subsidiary Certificate Percentage
Number of Shares Number Ownership
Delta Xxxxx, Inc. 100%
Pledgor: DELTA XXXXX, INC.
Name of Subsidiary CertificateN Percentage
Number of Shares Number Ownership
Delta Xxxxx Marketing, Inc. 100%
Exhibit 4(a)
to
Pledge Agreement
dated as of August 25, 1997
in favor of NationsBank, N.A.
as Administrative Agent
and
BNY Financial Corporation
as Collateral Agent
Irrevocable Stock Power
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers to the following shares of capital stock of
, a corporation:
No. of Shares Certificate No.
and irrevocably appoints BNY Financial Corporation its agent and
attorney-in-fact to transfer all or any part of such capital
stock and to take all necessary and appropriate action to effect
any such transfer. The Administrative agent and attorney-in-fact
may substitute and appoint one or more persons to act for him.
The effectiveness of a transfer pursuant to this stock power
shall be subject to any and all transfer restrictions referenced
on the face of the certificates evidencing such interest or in
the certificate of incorporation or bylaws of the subject
corporation, to the extent they may from time to time exist.
_______________,
a ______________ corporation
By:
Name:
Title:
Exhibit 1.1B
FORM OF SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Security Agreement") is
entered into as of August 25, 1997 among DELTA XXXXX, INC., a
Delaware corporation (the "Borrower"), certain Subsidiaries of
the Borrower (individually a "Guarantor" and collectively the
"Guarantors"; together with the Borrower, individually an
"Obligor", and collectively the "Obligors"), BNY FINANCIAL
CORPORATION (the "Collateral Agent") for the lenders from time to
time party to the Credit Agreement described below (the
"Lenders") and NATIONSBANK, N.A., in its capacity as
administrative agent (in such capacity, the "Administrative
Agent"; together with the Collateral Agent, the "Agents" ) for
the Lenders.
RECITALS
WHEREAS, pursuant to that certain Credit Agreement, dated as
of the date hereof (as amended, modified, extended, renewed or
replaced from time to time, the "Credit Agreement"), among the
Borrower, the Guarantors, the Lenders, the Administrative Agent
and the Collateral Agent, the Lenders have agreed to make Loans
and issue Letters of Credit upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the effectiveness of
the Credit Agreement and the obligations of the Lenders to make
their respective Loans and to issue Letters of Credit under the
Credit Agreement that the Obligors shall have executed and
delivered this Security Agreement to the Collateral Agent for the
ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of these premises and other
good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as
follows:
1. Definitions.
(a) Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to such terms
in the Credit Agreement, and the following terms which are
defined in the Uniform Commercial Code in effect in the
State of North Carolina on the date hereof are used herein
as so defined: Accounts, Chattel Paper, Deposit Accounts,
Documents, Farm Products, General Intangibles, Instruments,
Inventory and Proceeds. For purposes of this Security
Agreement, the term "Lender" shall include any Issuing
Lender.
(b) In addition, the following terms shall have the
following meanings:
"Secured Obligations": the collective reference to the
following:
(a) In the case of the Borrower, the prompt
performance and observance by the Borrower of all
obligations of the Borrower under the Credit Agreement, the
Notes, this Security Agreement and the other Credit
Documents to which the Borrower is a party;
(b) In the case of the Guarantors, the prompt
performance and observance by such Guarantor of all
obligations of such Guarantor under the Credit Agreement,
this Security Agreement and the other Credit Documents to
which such Guarantor is a party, including, without
limitation, its guaranty obligations arising under Section 4
of the Credit Agreement; and
(c) All other indebtedness, liabilities and
obligations of any kind or nature owing from any Obligor to
any Lender, the Administrative Agent or the Collateral Agent
arising under the Credit Agreement or the Credit Documents
and all obligations and liabilities incurred in connection
with collecting and enforcing the Secured Obligations.
2. Grant of Security Interest in the Collateral. To
secure the prompt payment and performance in full when due,
whether by lapse of time, acceleration or otherwise, of the
Secured Obligations, each Obligor hereby grants to the Collateral
Agent, for the benefit of the Lenders, a continuing security
interest in, and a right to set off against, any and all right,
title and interest of such Obligor in and to the following,
whether now owned or existing or owned, acquired, or arising
hereafter (collectively, the "Collateral"):
(a) all Accounts;
(b) all Inventory;
(c) all Deposit Accounts, General
Intangibles, Chattel Paper, Documents, and
Instruments to the extent arising out of or
resulting from the sale or lease of inventory or
the rendering of services by Debtor;
(d) all rights to receive payments under the
Factoring Agreements; and
(e) all books, records, ledger cards, files,
correspondence, computer programs, tapes, disks,
and related data processing software (owned by
such Obligor or in which it has an interest) that
at any time evidence or contain information
relating to any Collateral or are otherwise
necessary or helpful in the collection thereof or
realization thereupon; and
(f) to the extent not otherwise included,
all Proceeds of any and all of the foregoing.
The Obligors and the Agents, on behalf of the Lenders,
hereby acknowledge and agree that the security interest created
hereby in the Collateral constitutes continuing collateral
security for all of the Secured Obligations, whether now existing
or hereafter arising.
3. Provisions Relating to Accounts.
(a) Anything herein to the contrary notwithstanding,
each of the Obligors shall remain liable under each of the
Accounts to observe and perform all the conditions and
obligations to be observed and performed by it thereunder,
all in accordance with the terms of any agreement giving
rise to each such Account. Neither the Administrative
Agent, the Collateral Agent nor any Lender shall have any
obligation or liability under any Account (or any agreement
giving rise thereto) by reason of or arising out of this
Security Agreement or the receipt by the Administrative
Agent, the Collateral Agent or any Lender of any payment
relating to such Account pursuant hereto, nor shall the
Administrative Agent, the Collateral Agent or any Lender be
obligated in any manner to perform any of the obligations of
an Obligor under or pursuant to any Account (or any
agreement giving rise thereto), to make any payment, to make
any inquiry as to the nature or the sufficiency of any
payment received by it or as to the sufficiency of any
performance by any party under any Account (or any agreement
giving rise thereto), to present or file any claim, to take
any action to enforce any performance or to collect the
payment of any amounts which may have been assigned to it or
to which it may be entitled at any time or times.
(b) Once during each calendar year or at any time
after the occurrence and during the continuation of an Event
of Default, the Agents or their representative shall have
the right, but not the obligation, to make test
verifications of the Accounts in any manner and through any
medium that it reasonably considers advisable, and the
Obligors shall furnish all such assistance and information
as such Agent or its representative may require in
connection with such test verifications. At any time and
from time to time, upon an Agent's request and at the
expense of the Obligors, the Obligors shall cause
independent public accountants or others satisfactory to
such Agent to furnish to such Agent or its representative
reports showing reconciliations, aging and test
verifications of, and trial balances for, the Accounts.
Each Agent in its own name or in the name of others may
communicate with account debtors on the Accounts to verify
with them to such Agent's satisfaction the existence, amount
and terms of any Accounts.
4. Representations and Warranties. Each Obligor hereby
represents and warrants to the Agents, for the benefit of the
Lenders, that so long as any of the Secured Obligations remain
outstanding or any Credit Document is in effect or any Letter of
Credit shall remain outstanding, and until all of the Commitments
shall have been terminated:
(a) Chief Executive Office; Books & Records. Each
Obligor's chief executive office and chief place of business
is (and for the prior four months have been) located at the
locations set forth on Schedule 4(a) hereto, and each
Obligor keeps its books and records at such locations.
(b) Location of Collateral. The location of all
Collateral owned by each Obligor is as shown on Schedule
4(b) hereto.
(c) Ownership. Each Obligor is the legal and
beneficial owner of its Collateral and has the right to
pledge, sell, assign or transfer the same. Each Obligor's
legal name is as shown in this Security Agreement and no
Obligor has in the past four months changed its name, been
party to a merger, consolidation or other change in
structure or used any tradename except as set forth in
Schedule 4(c) attached hereto.
(d) Security Interest/Priority. This Security
Agreement creates a valid security interest in favor of the
Collateral Agent, for the benefit of the Lenders, in the
Collateral of such Obligor and, when properly perfected by
filing, shall constitute a valid perfected security interest
in such Collateral, to the extent such security can be
perfected by filing under the UCC, free and clear of all
Liens except for Permitted Liens.
(e) Farm Products. None of the Collateral
constitutes, or is the Proceeds of, Farm Products.
(f) Accounts. (i) Each Account of the Obligors and
the papers and documents relating thereto are genuine and in
all material respects what they purport to be, (ii) each
Account arises out of (A) a bona fide sale of goods sold and
delivered by such Obligor (or is in the process of being
delivered) or (B) services theretofore actually rendered by
such Obligor to, the account debtor named therein, (iii) no
Account or other right of an Obligor to payment for goods
sold and delivered or services rendered is evidenced by any
Instrument or Chattel Paper unless such Instrument or
Chattel Paper has been theretofore endorsed over and
delivered to the Collateral Agent and (iv) no surety bond
was required or given in connection with any Account of an
Obligor or the contracts or purchase orders out of which
they arose.
(g) Inventory. No Inventory is held by an Obligor
pursuant to consignment, sale or return, sale on approval or
similar arrangement.
5. Covenants. Each Obligor covenants that, so long as any
of the Secured Obligations remain outstanding or any Credit
Document is in effect or any Letter of Credit shall remain
outstanding, and until all of the Commitments shall have been
terminated, such Obligor shall:
(a) Other Liens. Defend the Collateral against the
claims and demands of all other parties claiming an interest
therein, keep the Collateral free from all Liens, except for
Permitted Liens, and not sell, exchange, transfer, assign,
lease or otherwise dispose of the Collateral or any interest
therein, except as permitted under the Credit Agreement.
(b) Preservation of Collateral. Keep the Collateral
in good order, condition and repair and not use the
Collateral in violation of the provisions of this Security
Agreement or any other agreement relating to the Collateral
or any policy insuring the Collateral or any applicable
statute, law, bylaw, rule, regulation or ordinance.
(c) Instruments/Chattel Paper. If any amount payable
under or in connection with any of the Collateral shall be
or become evidenced by any Instrument or Chattel Paper,
immediately deliver such Instrument or Chattel Paper to the
Collateral Agent, duly indorsed in a manner satisfactory to
the Administrative Agent, to be held as Collateral pursuant
to this Security Agreement.
(d) Change in Location. Not, without providing 30
days prior written notice to the Administrative Agent and
without filing such amendments to any previously filed
financing statements as the Administrative Agent may
require, (a) change the location of its chief executive
office and chief place of business (as well as its books and
records) from the locations set forth on Schedule 4(a)
hereto, (b) change the location of its Collateral from the
locations set forth for such Obligor on Schedule 4(b)
hereto, or (c) change its name, be party to a merger,
consolidation or other change in structure or use any
tradename other than as set forth on Schedule 4(c) attached
hereto.
(e) Inspection. Upon reasonable notice, and during
reasonable hours, at all times allow the Administrative
Agent or its representatives to visit and inspect the
Collateral as set forth in Section 7.10 of the Credit
Agreement.
(f) Perfection of Security Interest. Execute and
deliver to the Administrative Agent such agreements,
assignments or instruments (including affidavits, notices,
reaffirmations and amendments and restatements of existing
documents, as the Administrative Agent may reasonably
request) and do all such other things as the Administrative
Agent may reasonably deem necessary or appropriate (i) to
assure to the Administrative Agent the Collateral Agent's
security interests hereunder, including (A) such financing
statements (including renewal statements) or amendments
thereof or supplements thereto or other instruments as the
Administrative Agent may from time to time reasonably
request in order to perfect and maintain the security
interests granted hereunder in accordance with the UCC, (ii)
to consummate the transactions contemplated hereby and (iii)
to otherwise protect and assure the Administrative Agent of
the Collateral Agent's rights and interests hereunder. To
that end, each Obligor agrees that the Administrative Agent
may file one or more financing statements disclosing the
Collateral Agent's security interest in any or all of the
Collateral of such Obligor without, to the extent permitted
by law, such Obligor's signature thereon, and further each
Obligor also hereby irrevocably makes, constitutes and
appoints the Administrative Agent, its nominee or any other
person whom the Administrative Agent may designate, as such
Obligor's attorney in fact with full power and for the
limited purpose to sign in the name of such Obligor any such
financing statements, or amendments and supplements to
financing statements, renewal financing statements, notices
or any similar documents which in the Administrative Agent's
reasonable discretion would be necessary, appropriate or
convenient in order to perfect and maintain perfection of
the security interests granted hereunder, such power, being
coupled with an interest, being and remaining irrevocable so
long as the Credit Agreement is in effect or any amounts
payable thereunder or under any other Credit Document or any
Letter of Credit shall remain outstanding, and until all of
the Commitments thereunder shall have terminated. Each
Obligor hereby agrees that a carbon, photographic or other
reproduction of this Security Agreement or any such
financing statement is sufficient for filing as a financing
statement by the Administrative Agent without notice thereof
to such Obligor wherever the Administrative Agent may in its
sole discretion desire to file the same. In the event for
any reason the law of any jurisdiction other than North
Carolina becomes or is applicable to the Collateral of any
Obligor or any part thereof, or to any of the Secured
Obligations, such Obligor agrees to execute and deliver all
such instruments and to do all such other things as the
Administrative Agent in its sole discretion reasonably deems
necessary or appropriate to preserve, protect and enforce
the security interests of the Collateral Agent under the law
of such other jurisdiction (and, if an Obligor shall fail to
do so promptly upon the request of the Administrative Agent,
then the Administrative Agent may execute any and all such
requested documents on behalf of such Obligor pursuant to
the power of attorney granted hereinabove). If any
Collateral is in the possession or control of an Obligor's
agents and the Administrative Agent so requests, such
Obligor agrees to notify such agents in writing of the
Collateral Agent's security interest therein and, upon the
Administration Agent's request, instruct them to hold all
such Collateral for the Lenders' account and subject to the
Administrative Agent's instructions. Each Obligor agrees to
xxxx its books and records to reflect the security interest
of the Collateral Agent in the Collateral.
(g) Treatment of Accounts. Not grant or extend the
time for payment of any Account, or compromise or settle any
Account for less than the full amount thereof, or release
any person or property, in whole or in part, from payment
thereof, or allow any credit or discount thereon, other than
as normal and customary in the ordinary course of an
Obligor's business.
(h) Insurance. Insure, repair and replace the
Collateral of such Obligor as set forth in the Credit
Agreement. All insurance proceeds shall be subject to the
security interest of the Collateral Agent hereunder.
6. Advances by Lenders. On failure of any Obligor to
perform any of the covenants and agreements contained herein, the
Administrative Agent may, at its sole option and in its sole
discretion, perform the same and in so doing may expend such sums
as the Administrative Agent may reasonably deem advisable in the
performance thereof, including, without limitation, the payment
of any insurance premiums, the payment of any taxes, a payment to
obtain a release of a Lien or potential Lien, expenditures made
in defending against any adverse claim and all other expenditures
which the Administrative Agent or the Lenders may make for the
protection of the security hereof or which may be compelled to
make by operation of law. All such sums and amounts so expended
shall be repayable by the Obligors on a joint and several basis
promptly upon timely notice thereof and demand therefor, shall
constitute additional Secured Obligations and shall bear interest
from the date said amounts are expended at the default rate
specified in Section 3.1 of the Credit Agreement for Base Rate
Loans. No such performance of any covenant or agreement by the
Administrative Agent or the Lenders on behalf of any Obligor, and
no such advance or expenditure therefor, shall relieve the
Obligors of any default under the terms of this Security
Agreement or the other Credit Documents. The Lenders may make
any payment hereby authorized in accordance with any xxxx,
statement or estimate procured from the appropriate public office
or holder of the claim to be discharged without inquiry into the
accuracy of such xxxx, statement or estimate or into the validity
of any tax assessment, sale, forfeiture, tax lien, title or claim
except to the extent such payment is being contested in good
faith by an Obligor in appropriate proceedings and against which
adequate reserves are being maintained in accordance with GAAP.
7. Events of Default.
The occurrence of an event which under the Credit Agreement
would constitute an Event of Default shall be an Event of Default
hereunder (an "Event of Default").
8. Remedies.
(a) General Remedies. Upon the occurrence of an Event
of Default and during continuation thereof, the Lenders
shall have, in addition to the rights and remedies provided
herein, in the Credit Documents or by law (including, but
not limited to, the rights and remedies set forth in the
Uniform Commercial Code of the jurisdiction applicable to
the affected Collateral), the rights and remedies of a
secured party under the UCC (regardless of whether the UCC
is the law of the jurisdiction where the rights and remedies
are asserted and regardless of whether the UCC applies to
the affected Collateral), and further, the Collateral Agent
shall at the direction of the Administrative Agent, with or
without judicial process or the aid and assistance of
others, (i) enter on any premises on which any of the
Collateral may be located and, without resistance or
interference by the Obligors, take possession of the
Collateral, (ii) dispose of any Collateral on any such
premises, (iii) require the Obligors to assemble and make
available to the Administrative Agent at the expense of the
Obligors any Collateral at any place and time designated by
the Administrative Agent which is reasonably convenient to
both parties, (iv) remove any Collateral from any such
premises for the purpose of effecting sale or other
disposition thereof, and/or (v) without demand and without
advertisement, notice, hearing or process of law, all of
which each of the Obligors hereby waives to the fullest
extent permitted by law, at any place and time or times,
sell and deliver any or all Collateral held by or for it at
public or private sale, by one or more contracts, in one or
more parcels, for cash, upon credit or otherwise, at such
prices and upon such terms as the Administrative Agent deems
advisable, in its sole discretion (subject to any and all
mandatory legal requirements). In addition to all other
sums due the Agents and the Lenders with respect to the
Secured Obligations, the Obligors shall pay the Agents and
each of the Lenders all reasonable documented costs and
expenses incurred by the Agents or any such Lender,
including, but not limited to, reasonable attorneys' fees
and court costs, in obtaining or liquidating the Collateral,
in enforcing payment of the Secured Obligations, or in the
prosecution or defense of any action or proceeding by or
against the Agents or the Lenders or the Obligors concerning
any matter arising out of or connected with this Security
Agreement, any Collateral or the Secured Obligations,
including, without limitation, any of the foregoing arising
in, arising under or related to a case under the Bankruptcy
Code. To the extent the rights of notice cannot be legally
waived hereunder, each Obligor agrees that any requirement
of reasonable notice shall be met if such notice is
personally served on or mailed, postage prepaid, to the
Borrower in accordance with the notice provisions of Section
11.1 of the Credit Agreement at least 10 days before the
time of sale or other event giving rise to the requirement
of such notice. The Agents and the Lenders shall not be
obligated to make any sale or other disposition of the
Collateral regardless of notice having been given. To the
extent permitted by law, any Lender may be a purchaser at
any such sale. To the extent permitted by applicable law,
each of the Obligors hereby waives all of its rights of
redemption with respect to any such sale. Subject to the
provisions of applicable law, the Administrative Agent and
the Lenders may postpone or cause the postponement of the
sale of all or any portion of the Collateral by announcement
at the time and place of such sale, and such sale may,
without further notice, to the extent permitted by law, be
made at the time and place to which the sale was postponed,
or the Administrative Agent and the Lenders may further
postpone such sale by announcement made at such time and
place.
(b) Remedies relating to Accounts. Subject to the
limitations set forth in any assignment of factoring
proceeds with respect to any Factoring Agreement, upon the
occurrence of an Event of Default and during the
continuation thereof, whether or not the Collateral Agent at
the direction of the Administrative Agent has exercised any
or all of its rights and remedies hereunder, each Obligor
will promptly upon request of the Administrative Agent
instruct all account debtors or the applicable Factor to
remit all payments in respect of the Accounts or the
receivables to a mailing location selected by the
Administrative Agent, provided that, in accordance with the
applicable assignment of factoring proceeds, the
Administrative Agent shall also be entitled to give such
instruction directly to the Factor. In addition, the
Collateral Agent at the direction of the Administrative
Agent may notify any Obligor's customers and account debtors
that the Accounts of such Obligor have been assigned to the
Collateral Agent or of the Collateral Agent's security
interest therein, and may (either in its own name or in the
name of an Obligor or both) demand, collect (including
without limitation by way of a lockbox arrangement),
receive, take receipt for, sell, xxx for, compound, settle,
compromise and give acquittance for any and all amounts due
or to become due on any Account, and, in the Administrative
Agent's discretion, file any claim or take any other action
or proceeding to protect and realize upon the security
interest of the Lenders in the Accounts. Each Obligor
acknowledges and agrees that the Proceeds of its Accounts
remitted to or on behalf of the Collateral Agent in
accordance with the provisions hereof shall be solely for
the Collateral Agent's own convenience and that such Obligor
shall not have any right, title or interest in such Accounts
or in any such other amounts except as expressly provided
herein. The Agents and the Lenders shall have no liability
or responsibility to any Obligor for acceptance of a check,
draft or other order for payment of money bearing the legend
"payment in full" or words of similar import or any other
restrictive legend or endorsement or be responsible for
determining the correctness of any remittance. Each Obligor
hereby agrees to indemnify the Agents and the Lenders from
and against all liabilities, damages, losses, actions,
claims, judgments, costs, expenses, charges and reasonable
attorneys' fees suffered or incurred by the Agents or the
Lenders (each, an "Indemnified Party") because of the
maintenance of the foregoing arrangements except as relating
to or arising out of the gross negligence or willful
misconduct of an Indemnified Party or its officers,
employees or agents. In the case of any investigation,
litigation or other proceeding, the foregoing indemnity
shall be effective whether or not such investigation,
litigation or proceeding is brought by an Obligor, its
directors, shareholders or creditors or an Indemnified Party
or any other Person or any other Indemnified Party is
otherwise a party thereto.
(c) Access. In addition to the rights and remedies
hereunder, upon the occurrence of an Event of Default and
during the continuance thereof, the Collateral Agent shall
upon the instruction of the Administrative Agent have the
right to enter and remain upon the various premises of the
Obligors without cost or charge to the Agents, and use the
same, together with materials, supplies, books and records
of the Obligors for the purpose of collecting and
liquidating the Collateral, or for preparing for sale and
conducting the sale of the Collateral, whether by
foreclosure, auction or otherwise. In addition, the
Collateral Agent at the direction of the Administrative
Agent shall remove Collateral, or any part thereof, from
such premises and/or any records with respect thereto, in
order to effectively collect or liquidate such Collateral.
(d) Factoring Agreements. In addition to the remedies
identified above, if any Event of Default has occurred and
is continuing, the Collateral Agent shall upon the
instruction of the Administrative Agent exercise all of the
rights of the Borrower to receive payments under the
Factoring Agreements. Anything contained herein or in the
Factoring Agreements to the contrary notwithstanding, the
Borrower shall at all times remain liable under the
Factoring Agreements to perform all of the duties and
obligations of the Borrower thereunder to the same extent as
if this Agreement had not been executed, and the Agents and
the Lenders shall not have any obligation or liability under
the Factoring Agreements by reason of or arising out of this
Agreement, nor shall the Agents or any of the Lenders be
required or obligated in any manner to perform or fulfill
any obligation of the Borrower under or pursuant to the
Factoring Agreements or to make any payment, or to make any
inquiry as to the nature or sufficiency of any payment
received by it, or to present or file any claim, or take any
action to collect or enforce the payment of any amounts
which have been assigned to it or to which it may be
entitled at any time or times.
(e) Nonexclusive Nature of Remedies. Failure by the
Agents or the Lenders to exercise any right, remedy or
option under this Security Agreement, any other Credit
Document or as provided by law, or any delay by the Agents
or the Lenders in exercising the same, shall not operate as
a waiver of any such right, remedy or option. No waiver
hereunder shall be effective unless it is in writing, signed
by the party against whom such waiver is sought to be
enforced and then only to the extent specifically stated,
which in the case of the Agents or the Lenders shall only be
granted as provided herein. To the extent permitted by law,
neither the Agents, the Lenders, nor any party acting as
attorney for the Agents or the Lenders, shall be liable
hereunder for any acts or omissions or for any error of
judgment or mistake of fact or law other than their gross
negligence or willful misconduct hereunder. The rights and
remedies of the Agents and the Lenders under this Security
Agreement shall be cumulative and not exclusive of any other
right or remedy which the Agents or the Lenders may have.
(f) Retention of Collateral. The Collateral Agent
shall at the direction of the Administrative Agent, after
providing the notices required by Section 9-505(2) of the
UCC or otherwise complying with the requirements of
applicable law of the relevant jurisdiction, to the extent
the Collateral Agent is in possession of any of the
Collateral, retain the Collateral in satisfaction of the
Secured Obligations. Unless and until the Collateral Agent
shall have provided such notices, however, the Collateral
Agent shall not be deemed to have retained any Collateral in
satisfaction of any Secured Obligations for any reason.
(g) Deficiency. In the event that the proceeds of any
sale, collection or realization are insufficient to pay all
amounts to which the Agents or the Lenders are legally
entitled, the Obligors shall be jointly and severally liable
for the deficiency, together with interest thereon at the
default rate specified in Section 3.1 of the Credit
Agreement for Base Rate Loans, together with the costs of
collection and the reasonable fees of any attorneys employed
by the Agents to collect such deficiency. Any surplus
remaining after the full payment and satisfaction of the
Secured Obligations shall be returned to the Obligors or to
whomsoever a court of competent jurisdiction shall determine
to be entitled thereto.
9. Rights of the Agents.
(a) Power of Attorney. In addition to other powers of
attorney contained herein, each Obligor hereby designates
and appoints the Collateral Agent, on behalf of the Lenders,
and each of its designees or agents, as attorney-in-fact of
such Obligor, irrevocably and with power of substitution,
with authority to take any or all of the following actions
upon the occurrence and during the continuance of an Event
of Default subject to other provisions hereof and as set
forth in any assignment of factoring proceeds with respect
to any Factoring Agreement (the taking of any such action
shall be at the direction of the Administrative Agent):
(i) to demand, collect, settle,
compromise, adjust, give discharges and releases,
all as the Administrative Agent may reasonably
determine;
(ii) to commence and prosecute any
actions at any court for the purposes of
collecting any Collateral and enforcing any other
right in respect thereof;
(iii) to defend, settle or
compromise any action brought and, in connection
therewith, give such discharge or release as the
Administrative Agent may deem reasonably
appropriate;
(iv) receive, open and dispose of mail
addressed to an Obligor and endorse checks, notes,
drafts, acceptances, money orders, bills of
lading, warehouse receipts or other instruments or
documents evidencing payment, shipment or storage
of the goods giving rise to the Collateral of such
Obligor on behalf of and in the name of such
Obligor, or securing, or relating to such
Collateral;
(v) sell, assign, transfer, make any
agreement in respect of, or otherwise deal with or
exercise rights in respect of, any Collateral or
the goods or services which have given rise
thereto, as fully and completely as though the
Administrative Agent were the absolute owner
thereof for all purposes;
(vi) adjust and settle claims under any
insurance policy relating thereto;
(vii) execute and deliver all
assignments, conveyances, statements, financing
statements, renewal financing statements, security
agreements, affidavits, notices and other
agreements, instruments and documents that the
Administrative Agent may determine necessary in
order to perfect and maintain the security
interests and liens granted in this Security
Agreement and in order to fully consummate all of
the transactions contemplated therein;
(viii) institute any foreclosure
proceedings that the Administrative Agent may deem
appropriate; and
(ix) do and perform all such other acts
and things as the Administrative Agent may
reasonably deem to be necessary, proper or
convenient in connection with the Collateral.
This power of attorney is a power coupled with an interest
and shall be irrevocable (i) for so long as any of the
Secured Obligations remain outstanding, any Credit Document
is in effect or any Letter of Credit shall remain
outstanding and (ii) until all of the Commitments shall have
been terminated. The Collateral Agent shall be under no
duty, unless directed by the Administrative Agent, to
exercise or withhold the exercise of any of the rights,
powers, privileges and options expressly or implicitly
granted to the Collateral Agent in this Security Agreement,
and shall not be liable for any failure to do so or any
delay in doing so. The Agents shall not be liable for any
act or omission or for any error of judgment or any mistake
of fact or law in their individual capacities or for the
Collateral Agent in its capacity as attorney-in-fact except
acts or omissions resulting from its gross negligence or
willful misconduct. This power of attorney is conferred on
the Collateral Agent solely to protect, preserve and realize
upon the Collateral Agent's security interest in the
Collateral.
(b) Performance by the Collateral Agent of
Obligations. If any Obligor fails to perform any agreement
or obligation contained herein, the Collateral Agent at the
direction of the Administrative Agent may perform, or cause
performance of, such agreement or obligation, and the
expenses of the Agents incurred in connection therewith
shall be payable by the Obligors on a joint and several
basis pursuant to Section 11 hereof.
(c) Assignment by the Collateral Agent. The
Collateral Agent shall at the direction of the
Administrative Agent from time to time assign the Secured
Obligations or any portion thereof and/or the Collateral or
any portion thereof, and the assignee shall be entitled to
all of the rights and remedies of the Collateral Agent under
this Security Agreement in relation thereto.
10. Application of Proceeds. Upon the occurrence and
during the continuance of an Event of Default, any payments in
respect of the Secured Obligations and any proceeds of the
Collateral, when received by an Agent or any of the Lenders in
cash or its equivalent, will be applied in reduction of the
Secured Obligations in the order set forth in Section 3.15(b) of
the Credit Agreement, and each Obligor irrevocably waives the
right to direct the application of such payments and proceeds and
acknowledges and agrees that the Administrative Agent shall have
the continuing and exclusive right to apply and reapply any and
all such payments and proceeds in the Administrative Agent's sole
discretion, notwithstanding any entry to the contrary upon any of
its books and records.
11. Costs of Counsel. If at any time hereafter, whether
upon the occurrence of an Event of Default or not, the
Administrative Agent or the Collateral Agent at the direction of
the Administrative Agent employs counsel to prepare or consider
amendments, waivers or consents with respect to this Security
Agreement, or to take action or make a response in or with
respect to any legal or arbitral proceeding relating to this
Security Agreement or relating to the Collateral, or to protect
the Collateral or exercise any rights or remedies under this
Security Agreement or with respect to the Collateral, then the
Obligors agree to promptly pay upon demand any and all such
reasonable documented costs and expenses of the Agents or the
Lenders, all of which costs and expenses shall constitute Secured
Obligations hereunder.
12. Continuing Agreement.
(a) This Security Agreement shall be a continuing
agreement in every respect and shall remain in full force
and effect so long as any of the Secured Obligations remain
outstanding or any Credit Document is in effect or any
Letter of Credit shall remain outstanding, and until all of
the Commitments thereunder shall have terminated (other than
any obligations with respect to the indemnities and the
representations and warranties set forth in the Credit
Documents). Upon such payment and termination, this
Security Agreement shall be automatically terminated and the
Agents and the Lenders shall, upon the request and at the
expense of the Obligors, forthwith release all of their
liens and security interests hereunder and shall execute and
deliver all UCC termination statements and/or other
documents reasonably requested by the Obligors evidencing
such termination. Notwithstanding the foregoing all
releases and indemnities provided hereunder shall survive
termination of this Security Agreement.
(b) This Security Agreement shall continue to be
effective or be automatically reinstated, as the case may
be, if at any time payment, in whole or in part, of any of
the Secured Obligations is rescinded or must otherwise be
restored or returned by either Agent or any Lender as a
preference, fraudulent conveyance or otherwise under any
bankruptcy, insolvency or similar law, all as though such
payment had not been made; provided that in the event
payment of all or any part of the Secured Obligations is
rescinded or must be restored or returned, all reasonable
costs and expenses (including without limitation any
reasonable legal fees and disbursements) incurred by either
Agent or any Lender in defending and enforcing such
reinstatement shall be deemed to be included as a part of
the Secured Obligations.
13. Amendments; Waivers; Modifications. This Security
Agreement and the provisions hereof may not be amended, waived,
modified, changed, discharged or terminated except as set forth
in Section 11.6 of the Credit Agreement.
14. Successors in Interest. This Security Agreement shall
create a continuing security interest in the Collateral and shall
be binding upon each Obligor, its successors and assigns and
shall inure, together with the rights and remedies of the Agents
and the Lenders hereunder, to the benefit of the Agents and the
Lenders and their successors and permitted assigns; provided,
however, that none of the Obligors may assign its rights or
delegate its duties hereunder without the prior written consent
of each Lender or the Required Lenders, as required by the Credit
Agreement. To the fullest extent permitted by law, each Obligor
hereby releases each Agent and each Lender, and its successors
and assigns, from any liability for any act or omission relating
to this Security Agreement or the Collateral, except for any
liability arising from the gross negligence or willful misconduct
of such Agent, or such Lender, or its officers, employees or
agents.
15. Notices. All notices required or permitted to be given
under this Security Agreement shall be in conformance with
Section 11.1 of the Credit Agreement.
16. Counterparts. This Security Agreement may be executed
in any number of counterparts, each of which where so executed
and delivered shall be an original, but all of which shall
constitute one and the same instrument. It shall not be
necessary in making proof of this Security Agreement to produce
or account for more than one such counterpart.
17. Headings. The headings of the sections and subsections
hereof are provided for convenience only and shall not in any way
affect the meaning or construction of any provision of this
Security Agreement.
18. Governing Law; Submission to Jurisdiction; Venue.
(a) THIS SECURITY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NORTH CAROLINA. Any legal action
or proceeding with respect to this Security Agreement
may be brought in the courts of the State of North
Carolina, or of the United States for the Western
District of North Carolina, and, by execution and
delivery of this Security Agreement, each Obligor
hereby irrevocably accepts for itself and in respect of
its property, generally and unconditionally, the
jurisdiction of such courts. Each Obligor further
irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at
the address for notices pursuant to Section 11.1 of the
Credit Agreement, such service to become effective 30
days after such mailing. Nothing herein shall affect
the right of the Administrative Agent or the Collateral
Agent at the direction of the Administrative Agent to
serve process in any other manner permitted by law or
to commence legal proceedings or to otherwise proceed
against any Obligor in any other jurisdiction.
(b) Each Obligor hereby irrevocably waives any
objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this
Security Agreement brought in the courts referred to in
subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
19. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES TO THIS SECURITY AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS SECURITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
20. Severability. If any provision of any of the Security
Agreement is determined to be illegal, invalid or unenforceable,
such provision shall be fully severable and the remaining
provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or
unenforceable provisions.
21. Entirety. This Security Agreement and the other Credit
Documents represent the entire agreement of the parties hereto
and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
22. Survival. All representations and warranties of the
Obligors hereunder shall survive the execution and delivery of
this Security Agreement and the other Credit Documents, the
delivery of the Notes and the making of the Loans and the
issuance of the Letters of Credit under the Credit Agreement.
23. Other Security. To the extent that any of the Secured
Obligations are now or hereafter secured by property other than
the Collateral (including, without limitation, securities owned
by an Obligor), or by a guarantee, endorsement or property of any
other Person, then the Agents and the Lenders shall have the
right to proceed against such other property, guarantee or
endorsement upon the occurrence of any Event of Default, and the
Administrative Agent and the Lenders have the right, in their
sole discretion, to determine which rights, security, liens,
security interests or remedies the Agents and the Lenders shall
at any time pursue, relinquish, subordinate, modify or take with
respect thereto, without in any way modifying or affecting any of
them or any of the Agents' and the Lenders' rights or the Secured
Obligations under this Security Agreement or under any other of
the Credit Documents.
24. Limitation on Liability. Notwithstanding any provision
to the contrary contained herein or in any other of the Credit
Documents, to the extent the obligations of a Guarantor shall be
adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state
or federal law relating to fraudulent conveyances or transfers)
then the obligations of each Guarantor hereunder shall be limited
to the maximum amount that is permissible under applicable law
(whether federal or state and including, without limitation, the
Bankruptcy Code).
25. Rights of Required Lenders. All rights of the Agents
hereunder, if not exercised by the Agents, may be exercised by
the Required Lenders. Notwithstanding anything herein to the
contrary, each of the Agents shall exercise, or refrain from
exercising, its rights and remedies (including the right of the
Administrative Agent to direct the Collateral Agent to take, or
refrain from taking, an action) only in accordance with the
instructions of the Required Lenders.
Each of the parties hereto has caused a counterpart of this
Security Agreement to be duly executed and delivered as of the
date first above written.
BORROWER: DELTA XXXXX, INC.,
a Delaware corporation
By:
Name:
Title:
GUARANTOR: DELTA XXXXX MARKETING, INC.,
a Delaware corporation
By:
Name:
Title:
Accepted and agreed to in Charlotte, North Carolina as of
the date first above written.
NATIONSBANK, N.A.,
as Administrative Agent
By:
Name:
Title:
BNY FINANCIAL CORPORATION,
as Collateral Agent
By:
Name:
Title:
SCHEDULE 4(a)
CHIEF EXECUTIVE OFFICE
SCHEDULE 4(b)
LOCATIONS OF COLLATERAL
SCHEDULE 4(c)
MERGERS, CONSOLIDATIONS, CHANGE IN STRUCTURE OR USE OF TRADENAMES
Exhibit 2.1(b)(i)
FORM OF NOTICE OF BORROWING
NationsBank, N.A.,
as Administrative Agent
for the Lenders
000 Xxxxx Xxxxx Xxxxxx
Independence Center, 00xx Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Ladies and Gentlemen:
The undersigned, DELTA XXXXX, INC. (the "Borrower"), refers
to the Credit Agreement dated as of August 25, 1997 (as amended,
modified, restated or supplemented from time to time, the "Credit
Agreement"), among the Borrower, the Guarantors, the Lenders,
NationsBank, N.A., as Administrative Agent, and BNY Financial
Corporation, as Collateral Agent. Capitalized terms used herein
and not otherwise defined herein shall have the meanings assigned
to such terms in the Credit Agreement. The Borrower hereby gives
notice pursuant to Section 2.1 of the Credit Agreement that it
requests a Revolving Loan advance under the Credit Agreement, and
in connection therewith sets forth below the terms on which such
Revolving Loan advance is requested to be made:
(A) Date of Borrowing (which is a Business Day)
(B) Principal Amount of Borrowing
(C) Interest rate basis
(D) Interest Period and the last day thereof
In accordance with the requirements of Section 5.2, the
Borrower hereby reaffirms the representations and warranties set
forth in the Credit Agreement as provided in subsection (b) of
such Section, and confirms that the matters referenced in
subsections (c), (d), (e) and (f) of such Section, are true and
correct.
DELTA XXXXX, INC.
By:
Name:
Title:
Exhibit 2.1(e)
FORM OF REVOLVING NOTE
$ August 25, 1997
FOR VALUE RECEIVED, DELTA XXXXX, INC., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order
of , its successors and assigns (the
"Lender"), at the office of NationsBank, N.A., as Administrative
Agent (the "Administrative Agent"), at 000 Xxxxx Xxxxx Xxxxxx,
Xxxxxxxxxxxx Center, NC1-001-15-04, Xxxxxxxxx, Xxxxx Xxxxxxxx
00000 (or at such other place or places as the holder hereof may
designate), at the times set forth in the Credit Agreement dated
as of the date hereof among the Borrower, the Guarantors, the
Lenders, the Administrative Agent and BNY Financial Corporation,
as Collateral Agent (as it may be as amended, modified, restated
or supplemented from time to time, the "Credit Agreement"; all
capitalized terms not otherwise defined herein shall have the
meanings set forth in the Credit Agreement), but in no event
later than the Maturity Date, in Dollars and in immediately
available funds, the principal amount of
DOLLARS $ or, if less than
such principal amount, the aggregate unpaid principal amount of
all Revolving Loans made by the Lender to the Borrower pursuant
to the Credit Agreement, and to pay interest from the date hereof
on the unpaid principal amount hereof, in like money, at said
office, on the dates and at the rates selected in accordance with
Section 2.1(d) of the Credit Agreement.
Upon the occurrence and during the continuance of an Event
of Default, the balance outstanding hereunder shall bear interest
as provided in Section 3.1 of the Credit Agreement. Further, in
the event the payment of all sums due hereunder is accelerated
under the terms of the Credit Agreement, this Revolving Note, and
all other indebtedness of the Borrower to the Lender shall become
immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which are hereby waived by the
Borrower.
In the event this Revolving Note is not paid when due at any
stated or accelerated maturity, the Borrower agrees to pay, in
addition to the principal and interest, all costs of collection,
including reasonable attorneys' fees.
All borrowings evidenced by this Revolving Note and all
payments and prepayments of the principal hereof and interest
hereon and the respective dates thereof shall be endorsed by the
holder hereof on Schedule A attached hereto and incorporated
herein by reference, or on a continuation thereof which shall be
attached hereto and made a part hereof; provided, however, that
any failure to endorse such information on such schedule or
continuation thereof shall not in any manner affect the
obligation of the Borrower to make payments of principal and
interest in accordance with the terms of this Revolving Note.
This Revolving Note and the Revolving Loans evidenced hereby
may be transferred in whole or in part only by registration of
such transfer on the Register maintained by or on behalf of the
Borrower as provided in Section 11.3(c) of the Credit Agreement.
IN WITNESS WHEREOF, the Borrower has caused this Revolving
Note to be duly executed by its duly authorized officer as of the
day and year first above written.
DELTA XXXXX, INC.
By:
Name:
Title:
SCHEDULE A TO THE
REVOLVING NOTE
OF
DATED AUGUST 25, 1997
Unpaid Name of
Principal Person
Type of Interest Payments Balance Making
Date Loan Period Principal Interest of Note Notation
Exhibit 2.3(d)
FORM OF SWINGLINE NOTE
$10,000,000 August 25, 1997
FOR VALUE RECEIVED, DELTA XXXXX, INC., a Delaware
corporation(the "Borrower"), hereby promises to pay to the order
of NATIONSBANK, N.A., its successors and assigns (the "Swingline
Lender"), at the office of NationsBank, N.A., as Administrative
Agent (the "Administrative Agent"), at 000 X. Xxxxx Xxxxxx,
Xxxxxxxxxxxx Center, NC1-001-15-04, Xxxxxxxxx, Xxxxx Xxxxxxxx
00000 (or at such other place or places as the holder hereof may
designate), at the times set forth in the Credit Agreement dated
as of the date hereof among the Borrower, the Swingline Lender
and other Lenders, the Administrative Agent and and BNY Financial
Corporation, as Collateral Agent (as it may be amended, modified,
extended or restated from time to time, the "Credit Agreement";
all capitalized terms not otherwise defined herein shall have the
meanings set forth in the Credit Agreement), but in no event
later than the Maturity Date, in Dollars and in immediately
available funds, the principal amount of TEN MILLION DOLLARS
($10,000,000) or, if less than such principal amount, the
aggregate unpaid principal amount of all Swingline Loans made by
the Swingline Lender to the Borrower pursuant to the Credit
Agreement, and to pay interest from the date hereof on the unpaid
principal amount hereof, in like money, at said office, on the
dates and at the rates selected in accordance with Section 2.3(c)
of the Credit Agreement.
Upon the occurrence and during the continuance of an Event
of Default, the balance outstanding hereunder shall bear interest
as provided in Section 3.1 of the Credit Agreement. Further, in
the event the payment of all sums due hereunder is accelerated
under the terms of the Credit Agreement, this Note, and all other
indebtedness of the Borrower to the Swingline Lender shall become
immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which are hereby waived by the
Borrower.
In the event this Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to
the principal and interest, all costs of collection, including
reasonable attorneys' fees.
All borrowings evidenced by this Note and all payments and
prepayments of the principal hereof and interest hereon and the
respective dates thereof shall be endorsed by the holder hereof
on Schedule A attached hereto and incorporated herein by refer
ence, or on a continuation thereof which shall be attached hereto
and made a part hereof; provided, however, that any failure to
endorse such information on such schedule or continuation thereof
shall not in any manner affect the obligation of the Borrower to
make payments of principal and interest in accordance with the
terms of this Note.
This Note and the Loans evidenced hereby may be transferred
in whole or in part only by registration of such transfer on the
Register maintained by or on behalf of the Borrower as provided
in Section 11.3(c) of the Credit Agreement.
IN WITNESS WHEREOF, the Borrower has caused this Note to be
duly executed by its duly authorized officer as of the day and
year first above written.
DELTA XXXXX, INC.
By:
Name:
Title:
SCHEDULE A TO THE
SWINGLINE NOTE
OF NATIONSBANK, N.A.
DATED AUGUST 25, 1997
Unpaid Name of
Principal Person
Type of Interest Payments Balance Making
Date Loan Period Principa Interest of Note Notation
Exhibit 3.2
FORM OF NOTICE OF EXTENSION/CONVERSION
NationsBank, N.A.,
as Administrative Agent
for the Lenders
000 Xxxxx Xxxxx Xxxxxx
Independence Center, 00xx Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Ladies and Gentlemen:
The undersigned, DELTA XXXXX, INC. (the "Borrower"), refers
to the Credit Agreement dated as of August 25, 1997 (as amended,
modified, restated or supplemented from time to time, the "Credit
Agreement"), among the Borrower, the Guarantors, the Lenders,
NationsBank, N.A., as Administrative Agent, and BNY Financial
Corporation, as Collateral Agent. Capitalized terms used herein
and not otherwise defined herein shall have the meanings assigned
to such terms in the Credit Agreement. The Borrower hereby gives
notice pursuant to Section 3.2 of the Credit Agreement that it
requests an extension or conversion of a Revolving Loan
outstanding under the Credit Agreement, and in connection
therewith sets forth below the terms on which such extension or
conversion is requested to be made:
(A) Date of Extension or Conversion
(which is the last day of the
the applicable Interest Period)
(B) Principal Amount of Extension or Conversion
(C) Interest rate basis
(D) Interest Period and the last day thereof
In accordance with the requirements of Section 5.2, the
Borrower hereby reaffirms the representations and warranties set
forth in the Credit Agreement as provided in subsection (b) of
such Section, and confirms that the matters referenced in
subsections (c), (d), (e) and (f) of such Section, are true and
correct.
DELTA XXXXX, INC.
By:
Name:
Title:
Exhibit 7.1(c)
FORM OF OFFICER'S COMPLIANCE CERTIFICATE
For the fiscal quarter ended , 19 .
I, , [Title] of DELTA XXXXX, INC. (the
"Borrower") hereby certify that, to the best of my knowledge and
belief, with respect to that certain Credit Agreement dated as of
August 25, 1997 (as amended, modified, restated or supplemented
from time to time, the "Credit Agreement"; all of the defined
terms in the Credit Agreement are incorporated herein by
reference) among the Borrower, the Guarantors, the Lenders,
NationsBank, N.A., as Administrative Agent, and BNY Financial
Corporation, as Collateral Agent:
a. The company-prepared financial statements which
accompany this certificate are true and correct in all
material respects and have been prepared in accordance
with GAAP applied on a consistent basis, subject to
changes resulting from normal year-end audit
adjustments.
b. Since (the date of the last similar
certification, or, if none, the Closing Date) no
Default or Event of Default has occurred under the
Credit Agreement; and
Delivered herewith are detailed calculations demonstrating
compliance by the Credit Parties with the financial covenants
contained in Section 7.11 of the Credit Agreement as of the end
of the fiscal period referred to above.
This day of , 19 .
DELTA XXXXX, INC.
By:
Name:
Title:
Attachment to Officer's Certificate
Computation of Financial Covenants
Exhibit 7.1(d)
FORM OF
BORROWING BASE CERTIFICATE
For the calendar month ended 19 .
I, , Chief Financial Officer of DELTA
XXXXX, INC. (the "Borrower") hereby certify that, to the best of
my knowledge and belief, with respect to that certain Credit
Agreement dated as of August 25, 1997 (as amended, modified,
restated or supplemented from time to time, the "Credit
Agreement"; all of the defined terms in the Credit Agreement are
incorporated herein by reference) among the Borrower, the
Guarantors, the Lenders, NationsBank, N.A., as Administrative
Agent, and BNY Financial Corporation, as Collateral Agent:
RECEIVABLES
1. Amounts owing to any Borrowing Base
Party under any Factoring
Agreements at such time (net of any amounts
(i) which the Factors are entitled to offset
against amounts owing to any Borrowing
Base Party under any Factoring Agreement
and (ii) owing by accounts debtors located
outside of the United States or Canada* $
2. Receivables (as defined in the
definition of Eligible Receivables in
Section 1.1 of the Credit Agreement)
subject to a perfected, first priority
Lien in favor of the Collateral Agent,
for the benefit of the Lenders $
3. (i) Receivables subject to any
Lien, other than Liens in favor
of the Collateral Agent, for the
benefit of the Lenders $
(ii) Receivables which are more
than 60 days past due (net of
reserves for bad debts in
connection with any such Receivables $
(iii) Receivables evidenced by notes,
chattel paper or other instruments
(unless such notes, chattel paper
or instruments have been delivered
to and are in the possession of
the Collateral Agent) $
(iv) Receivables owing by an account
debtor which is not solvent or is
subject to any bankruptcy or
insolvency proceeding of any kind
(net of any reserves in connection
with any such Receivables) $
(v) Receivables owing by an account
debtor located outside of the United
States or Canada (unless payment for
the goods shipped is secured by an
irrevocable letter of credit in a form
and from an institution acceptable to
the Administrative Agent) $
(vi) Receivables which are contingent
or as to which the account debtor has
made a claim for offset, deduction or
counterclaim, or is disputing, or raising
other defenses to, payment, but in each
case only to the extent of such offset,
deduction, counterclaim, dispute or
other defense and net of any reserves
in connection with any such Receivables $
(vii) Receivables for which any direct
or indirect Subsidiary of the Borrower
or any Affiliate of the Borrower is the
account debtor $
(viii) Receivables, to the extent exceeding
$2,500,000 in the aggregate at any one
time, representing a sale to the government
of the United States of America or any
subdivision thereof (unless the applicable
Borrowing Base Party has complied (to the
satisfaction of the Administrative Agent), with
respect to the granting of a security interest in such
Receivable, with the Federal Assignment
of Claims Act or other similar applicable
law, in which case all such Receivables may
be included as Eligible Receivables) $
(ix) Receivables which fail to meet
such other specifications and requirements
as have been established by the
Administrative Agent in its reasonable
discretion $
(x) Receivables arising from the sale to
an account debtor on a xxxx-and-hold, guaranteed
sale, sale or return, sale on approval, consignment
or any other repurchase or return basis $
(xi) Sum of lines (i) through (x) $
4. Eligible Receivables
(Line 1 plus Line 2 less Line 3(xi)) $
5. Eligible Receivables Borrowing
Base (85% of Eligible Receivables) $
INVENTORY
6. Inventory (the lower of the aggregate
book value (based on a FIFO or a moving
average cost valuation, consistently
applied) or fair market value, less
appropriate reserves determined in
accordance with GAAP, of all
raw materials and finished goods
inventory owned by any Borrowing
Base Party and subject to a perfected,
first priority Lien in favor of the
Collateral Agent, for the benefit
of the Lenders $
7. (i) Inventory subject to any Lien,
other than Liens referred to in
clauses (a), (b), (c) and (f) of
the definition of Permitted Liens $
(ii) Inventory which fails to meet
standards for sale or use imposed by
governmental agencies, departments
or divisions having regulatory
authority over such goods $
(iii) Inventory which is not useable
or salable at prices approximating
their cost in the ordinary course of
of the applicable Borrowing Base
Party's business (without duplication,
net of any reserves for obsolescence,
unsalability or decline in value) $
(iv) Inventory located outside of the
United States $
(v) Inventory located at a location not
owned or leased by the applicable
Borrowing Base Party $
(vi) Inventory located at a location
leased by the applicable Borrowing Base
Party with respect to which the
Administrative Agent shall not have
received a landlord's waiver satisfactory
to the Agent, other than the South Carolina
Bond Property* $
(vii) Inventory which is leased or on
consignment $
(viii) Inventory which fails to meet
such other specifications and
requirements as have been established
by the Administrative Agent in its
reasonable discretion $
(ix) Sum of lines (i) through (viii) $
8. Eligible Inventory
(Line 6 less Line 7(ix)) $
9. Eligible Inventory Borrowing
Base (60% of Eligible Inventory) $
BORROWING BASE
10. Total Borrowing Base availability
(Line 5 plus Line 9) $
11. Aggregate Outstanding Revolving Loans,
LOC Obligations and Swingline Loans under
the Credit Agreement $
12. If Line #10 is greater than Line #11, then
the difference ($ ) (or, if less,
the remaining amount of the Revolving
Committed Amount) is available for
extensions of credit under the Revolving
Commitments, the LOC Commitment (subject
to the terms of Section 2.2(a)) and the Swingline
Commitment (subject to the terms of
Section 2.3(a)); if Line #11 is greater than Line #10,
then the Borrower shall prepay or otherwise reduce
so much of the outstanding Revolving
Loans and LOC Obligations as shall be
necessary to eliminate such excess ($ ).
With reference to this Borrowing Base certificate, I hereby
certify that the above statements are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand and seal
this day of , 19 .
DELTA XXXXX, INC.
By:
Name:
Title:
Exhibit 7.12
FORM OF JOINDER AGREEMENT
THIS JOINDER AGREEMENT (the "Agreement"), dated as of
, 19 is by and between , a
(the "Subsidiary"), and NATIONSBANK, N.A., in
its capacity as Administrative Agent under that certain Credit
Agreement (as it may be amended, modified, restated or
supplemented from time to time, the "Credit Agreement"), dated as
of August 25, 1997, by and among Delta Xxxxx, Inc., a Delaware
corporation (the "Borrower"), the Guarantors, the Lenders,
NationsBank, N.A., as Administrative Agent, and BNY Financial
Corporation, as Collateral Agent. All of the defined terms in
the Credit Agreement are incorporated herein by reference.
The Subsidiary is an Additional Credit Party, and,
consequently, the Credit Parties are required by Section 7.12 of
the Credit Agreement to cause the Subsidiary to become a
"Guarantor".
Accordingly, the Subsidiary hereby agrees as follows with
the Administrative Agent, for the benefit of the Lenders:
1. The Subsidiary hereby acknowledges, agrees and confirms
that, by its execution of this Agreement, the Subsidiary will be
deemed to be a party to the Credit Agreement and a "Guarantor"
for all purposes of the Credit Agreement, and shall have all of
the obligations of a Guarantor thereunder as if it had executed
the Credit Agreement. The Subsidiary hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms,
provisions and conditions applicable to the Guarantors contained
in the Credit Agreement. Without limiting the generality of the
foregoing terms of this paragraph 1, the Subsidiary hereby (i)
jointly and severally together with the other Guarantors,
guarantees to each Lender and the Administrative Agent, as
provided in Section 4 of the Credit Agreement, the prompt payment
and performance of the Credit Party Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by
acceleration or otherwise) strictly in accordance with the terms
thereof.
2. The Subsidiary hereby acknowledges, agrees and confirms
that, by its execution of this Agreement, the Subsidiary will be
deemed to be a party to the Security Agreement, and shall have
all the obligations of an "Obligor" (as such term is defined in
the Security Agreement) thereunder as if it had executed the
Security Agreement. The Subsidiary hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms,
provisions and conditions contained in the Security Agreement.
Without limiting generality of the foregoing terms of this
paragraph 2, the Subsidiary hereby grants to the Collateral
Agent, for the benefit of the Lenders and the Senior Noteholders,
a continuing security interest in, and a right of set off against
any and all right, title and interest of the Subsidiary in and to
the Collateral (as such term is defined in Section 2 of the
Security Agreement) of the Subsidiary. The Subsidiary hereby
represents and warrants to the Administrative Agent that:
(i) The Subsidiary's chief executive office and chief
place of business are (and for the prior four months have
been) located at the locations set forth on Schedule 1
attached hereto and the Subsidiary keeps its books and
records at such locations.
(ii) The location of all Collateral owned by the
Subsidiary is as shown on Schedule 2 attached hereto.
(iii) The Subsidiary's legal name is as shown in
this Agreement and the Subsidiary has not in the past four
months changed its name, been party to a merger,
consolidation or other change in structure or used any
tradename except as set forth in Schedule 3 attached hereto.
3. The Subsidiary hereby acknowledges, agrees and confirms
that, by its execution of this Agreement, the Subsidiary will be
deemed to be a party to the Pledge Agreement, and shall have all
the obligations of a "Pledgor" thereunder as if it had executed
the Pledge Agreement. The Subsidiary hereby ratifies, as of the
date hereof, and agrees to be bound by, all the terms, provisions
and conditions contained in the Pledge Agreement. Without
limiting the generality of the foregoing terms of this paragraph
3, the Subsidiary hereby pledges and assigns to the Collateral
Agent, for the benefit of the Lenders, and grants to the
Collateral Agent, for the benefit of the Lenders, a continuing
security interest in any and all right, title and interest of the
Subsidiary in and to Pledged Shares (as such term is defined in
Section 2 of the Pledge Agreement) listed on Schedule 5 attached
hereto and the other Pledged Collateral (as such term is defined
in Section 2 of the Pledge Agreement).
4. The address of the Subsidiary for purposes of all
notices and other communications is ,
, Attention of
(Facsimile No. ).
5. The Subsidiary hereby waives acceptance by the
Administrative Agent and the Lenders of the guaranty by the
Subsidiary under Section 4 of the Credit Agreement upon the
execution of this Agreement by the Subsidiary.
6. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all
of which when taken together shall constitute one contract.
7. This Agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of North
Carolina.
IN WITNESS WHEREOF, the Subsidiary has caused this Joinder
Agreement to be duly executed by its authorized officers, and
each of the Administrative Agent and the Collateral Agent has for
the benefit of the Lenders, caused the same to be accepted by its
authorized officer, as of the day and year first above written.
[SUBSIDIARY]
By:
Name:
Title:
Acknowledged and accepted:
NATIONSBANK, N.A.,
as Administrative Agent
By:
Name:
Title:
BNY FINANCIAL CORPORATION,
as Collateral Agent
By:
Name:
Title:
Schedule 1
TO FORM OF JOINDER AGREEMENT
[Chief Executive Office and
Chief Place of Business of Subsidiary]
Schedule 2
TO FORM OF JOINDER AGREEMENT
Schedule 3
TO FORM OF JOINDER AGREEMENT
[Tradenames]
Schedule 5
TO FORM OF JOINDER AGREEMENT
[Pledged Shares]
Exhibit 11.3(b)
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of August
25, 1997, as amended and modified from time to time thereafter
(the "Credit Agreement") among DELTA XXXXX, INC., the other
Credit Parties party thereto, the Lenders party thereto,
NationsBank, N.A., as Administrative Agent, and BNY Financial
Corporation, as Collateral Agent. Terms defined in the Credit
Agreement are used herein with the same meanings.
The "Assignor" and the "Assignee" referred to on Schedule 1
agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
without recourse and without representation or warranty except as
expressly set forth herein, and the Assignee hereby purchases and
assumes from the Assignor, an interest in and to the Assignor's
rights and obligations under the Credit Agreement and the other
Credit Documents as of the date hereof equal to the percentage
interest specified on Schedule 1 of all outstanding rights and
obligations under the Credit Agreement and the other Credit
Documents. After giving effect to such sale and assignment, the
Assignee's Commitment and the amount of the Loans owing to the
Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse
claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit
Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Documents or any
other instrument or document furnished pursuant thereto; (iii)
makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Credit Party or
the performance or observance by any Credit Party of any of its
obligations under the Credit Documents or any other instrument or
document furnished pursuant thereto; and (iv) attaches the Notes
held by the Assignor and requests that the Administrative Agent
exchange such Notes for new Notes payable to the order of the
Assignee in an amount equal to the Commitment assumed by the
Assignee pursuant hereto and to the Assignor in an amount equal
to the Commitment retained by the Assignor, if any, as specified
on Schedule 1.
3. The Assignee (i) confirms that it has received a copy
of the Credit Agreement, together with copies of the financial
statements referred to in Section 7.1 thereof and such other
documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent,
the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible
Assignee; (iv) appoints and authorizes the Administrative Agent
and the Collateral Agent to take such action as administrative
agent and collateral agent, respectively, on its behalf and to
exercise such powers and discretion under the Credit Agreement as
are delegated to the Administrative Agent or the Collateral
Agent, as the case may be, by the terms thereof, together with
such powers and discretion as are reasonably incidental thereto;
(v) agrees that it will perform in accordance with their terms
all of the obligations that by the terms of the Credit Agreement
are required to be performed by it as a Lender; and (vi) attaches
any U.S. Internal Revenue Service or other forms required under
Section 3.11.
4. Following the execution of this Assignment and
Acceptance, it will be delivered to the Administrative Agent for
acceptance and recording by the Administrative Agent. The
effective date for this Assignment and Acceptance (the "Effective
Date") shall be the date of acceptance hereof by the
Administrative Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by the
Administrative Agent, as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under
the Credit Agreement.
6. Upon such acceptance and recording by the
Administrative Agent, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit
Agreement and the Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal,
interest and commitment fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes
for periods prior to the Effective Date directly between
themselves.
7. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of North
Carolina.
8. This Assignment and Acceptance may be executed in any
number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed
counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have
caused this Assignment and Acceptance to be executed by their
officers thereunto duly authorized as of the date hereof.
, as Assignor
By:
Name:
Title:
, as Assignee
By:
Name:
Title:
Notice address of Assignee:
<>
Attn:
Telephone: ( )
Telecopy: ( )
CONSENTED TO:
NATIONSBANK, N.A., *
as Administrative Agent
By:
Name:
Title:
DELTA XXXXX, INC.*
By:
Name:
Title:
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
(a) Date of Assignment:
(b) Legal Name of Assignor:
(c) Legal Name of Assignee:
(d) Effective Date of Assignment*
(e) Revolving Commitment Percentage Assigned
(expressed as a percentage set forth to at
least 8 decimals)
(f) Revolving Commitment Percentage of Assignee
after giving effect to this Assignment and
Acceptance as of the Effective
Date (set forth to at least 8 decimals) %
(g) Revolving Commitment Percentage of Assignor
after giving effect to this Assignment and
Acceptance as of the Effective
Date (set forth to at least 8 decimals) %
(h) Revolving Committed Amount as of Effective Date $______
(i) Dollar Amount of Assignor's Revolving Commitment
Percentage as of the Effective Date (the amount
set forth in (h) multiplied by the percentage
set forth in (g)) $______
(j) Dollar Amount of Assignee's Revolving Commitment
Percentages as of the Effective Date (the amount
set forth in (h) multiplied by the percentage
set forth in (f)) $______
_______________________________
* Except to the extent that (a) payment for the goods
shipped is secured by an irrevocable letter of credit in a form
and from an institution acceptable to the Agent or (b) the Factor
has assumed the credit risk of the related accounts receivable.
*Provided, however, that, after the date 60 days from the
Closing Date, inventory located at the South Carolina Bond
Property shall not be Eligible Inventory unless and until the
Administrative Agent shall have received a satisfactory
landlord's waiver with respect to such inventory.
* Required if the Assignee is an Eligible Assignee solely by
reason of clause (iii) of the definition of "Eligible Assignee."
* Required if the Assignee is an Eligible Assignee solely by
reason of clause (iii) of the definition of "Eligible Assignee."
* This date should be no earlier than five Business Days after
delivery of this Assignment and Acceptance to the Agent.
