Exhibit 10.1
AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of May 14, 2002
among
XXXXXX RESPIRATORY CARE INC.,
RIVER HOLDING CORP.,
The Lenders Party Hereto,
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Administrative Agent and Collateral Agent
TABLE OF CONTENTS Exhibit 10.1
Page
ARTICLE I Definitions.
SECTION 1.01. Defined Terms ................................................ 1
SECTION 1.02. Terms Generally .............................................. 33
ARTICLE II The Credits.
SECTION 2.01. Commitments .................................................. 34
SECTION 2.02. Loans ........................................................ 34
SECTION 2.03. Borrowing Procedure .......................................... 36
SECTION 2.04. Notes and Records ............................................ 36
SECTION 2.05. Fees ......................................................... 37
SECTION 2.06. Interest on Loans ............................................ 38
SECTION 2.07. Default Interest ............................................. 39
SECTION 2.08. Alternate Rate of Interest ................................... 39
SECTION 2.09. Termination and Reduction of Commitments ..................... 40
SECTION 2.10. Conversion and Continuation of Borrowings .................... 40
SECTION 2.11. Repayment of Term Borrowings ................................. 42
SECTION 2.12. Prepayment ................................................... 43
SECTION 2.13. Mandatory Prepayments ........................................ 43
SECTION 2.14. Reserve Requirements; Change in Circumstances ................ 46
SECTION 2.15. Change in Legality ........................................... 47
SECTION 2.16. Indemnity .................................................... 48
SECTION 2.17. Pro Rata Treatment ........................................... 49
SECTION 2.18. Sharing of Setoffs ........................................... 49
SECTION 2.19. Payments ..................................................... 50
SECTION 2.20. Taxes ........................................................ 50
SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate ............................................. 52
SECTION 2.22. Swingline Loans .............................................. 53
SECTION 2.23. Letters of Credit ............................................ 55
ARTICLE III Representations and Warranties.
SECTION 3.01. Organization; Powers ......................................... 59
SECTION 3.02. Authorization ................................................ 59
SECTION 3.03. Enforceability ............................................... 60
SECTION 3.04. Governmental Approvals and Licenses .......................... 60
SECTION 3.05. Financial Statements ......................................... 60
SECTION 3.06. No Material Adverse Change ................................... 61
SECTION 3.07. Title to Properties; Possession Under Leases ................. 61
SECTION 3.08. Subsidiaries ................................................. 62
SECTION 3.09. Litigation; Compliance with Laws ............................. 62
SECTION 3.10. Default in Material Agreements ............................... 62
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TABLE OF CONTENTS Exhibit 10.1
(continued)
Page
SECTION 3.11. Federal Reserve Regulations .................................. 62
SECTION 3.12. Investment Company Act; Public Utility Holding Company Act ... 62
SECTION 3.13. Use of Proceeds .............................................. 63
SECTION 3.14. Tax Returns .................................................. 63
SECTION 3.15. No Material Misstatements .................................... 63
SECTION 3.16. Employee Benefit Plans ....................................... 63
SECTION 3.17. Environmental Matters ........................................ 64
SECTION 3.18. Insurance .................................................... 64
SECTION 3.19. Security Documents ........................................... 65
SECTION 3.20. Location of Real Property and Leased Premises ................ 66
SECTION 3.21. Labor Matters ................................................ 66
SECTION 3.22. Solvency ..................................................... 66
ARTICLE IV Conditions of Lending.
SECTION 4.01. All Credit Events ............................................ 67
SECTION 4.02. Conditions Precedent to Effective Date ....................... 67
SECTION 4.03. Effective Date Matters ....................................... 69
ARTICLE V Affirmative Covenants.
SECTION 5.01. Existence; Businesses and Properties ......................... 72
SECTION 5.02. Insurance .................................................... 72
SECTION 5.03. Payment of Taxes ............................................. 74
SECTION 5.04. Financial Statements, Reports, etc. .......................... 74
SECTION 5.05. Litigation and Other Notices ................................. 76
SECTION 5.06. Employee Benefits ............................................ 77
SECTION 5.07. Maintaining Records; Access to Properties and Inspections .... 77
SECTION 5.08. Use of Proceeds .............................................. 77
SECTION 5.09. Compliance with Environmental Laws ........................... 78
SECTION 5.10. Preparation of Environmental Reports ......................... 78
SECTION 5.11. Further Assurances ........................................... 78
SECTION 5.12. Mortgaged Property Casualty and Condemnation ................. 79
SECTION 5.13. Sale of Excess Real Estate ................................... 82
SECTION 5.14. Certain Collateral Matters ................................... 83
ARTICLE VI Negative Covenants.
SECTION 6.01. Indebtedness ................................................. 83
SECTION 6.02. Liens ........................................................ 85
SECTION 6.03. Investments, Loans and Advances .............................. 86
SECTION 6.04. Mergers, Consolidations, Sales of Assets and Acquisitions .... 87
SECTION 6.05. Dividends and Distributions; Restrictions on Ability of
Subsidiaries to Pay Dividends ................................ 88
-ii-
TABLE OF CONTENTS Exhibit 10.1
(continued)
Page
SECTION 6.06. Transactions with Affiliates ................................. 90
SECTION 6.07. Business of Holding, Borrower and Subsidiaries ............... 91
SECTION 6.08. Capital Expenditures ......................................... 91
SECTION 6.09. Debt/Adjusted EBITDA Ratio ................................... 91
SECTION 6.10. Minimum EBITDA ............................................... 91
SECTION 6.11. Interest Coverage Ratio ...................................... 92
SECTION 6.12. Fixed Charge Coverage Ratio .................................. 92
SECTION 6.13. Modification of Certain Agreements ........................... 92
SECTION 6.14. Additional Provisions Concerning Unrestricted Subsidiaries ... 92
SECTION 6.15. Bank Accounts ................................................ 93
ARTICLE VII Defaults and Remedies.
SECTION 7.01. Events of Default ............................................ 93
ARTICLE VIII The Agents.
SECTION 8.01. Appointment of Administrative and Collateral Agent ........... 96
SECTION 8.02. Limitations on Liabilities ................................... 96
SECTION 8.03. Acting at the Direction of the Required Lenders .............. 97
SECTION 8.04. Resignation of the Administrative Agent or the Collateral
Agent ........................................................ 97
SECTION 8.05. Other Transactions ........................................... 97
SECTION 8.06. Reimbursement and Indemnity .................................. 97
SECTION 8.07. No Reliance .................................................. 98
ARTICLE IX Miscellaneous.
SECTION 9.01. Notices ...................................................... 98
SECTION 9.02. Survival of Agreement ........................................ 99
SECTION 9.03. Effectiveness; Termination ................................... 99
SECTION 9.04. Successors and Assigns ....................................... 99
SECTION 9.05. Expenses; Indemnity .......................................... 103
SECTION 9.06. Right of Setoff .............................................. 104
SECTION 9.07. Applicable Law ............................................... 104
SECTION 9.08. Waivers; Amendment ........................................... 104
SECTION 9.09. Interest Rate Limitation ..................................... 106
SECTION 9.10. Entire Agreement ............................................. 106
SECTION 9.11. WAIVER OF JURY TRIAL ......................................... 106
SECTION 9.12. Severability ................................................. 107
SECTION 9.13. Counterparts ................................................. 107
SECTION 9.14. Headings ..................................................... 107
SECTION 9.15. Jurisdiction; Consent to Service of Process .................. 107
SECTION 9.16. Confidentiality .............................................. 108
-iii-
Exhibit 10.1
Annexes
-------
Annex 1 - Loan Commitments and Term Loan Commitments
Annex 2 - Administrative Information
Annex 3 - Description of the Recapitalization
Annex 4 - Description of the Gibeck AB Transaction
Schedules
---------
Schedule 1.01(a) - Existing Letters of Credit
Schedule 1.01(b) - Mortgaged Properties
Schedule 1.01(c) - Subsidiary Guarantors
Schedule 3.07(b) - Exceptions to Compliance with Leases
Schedule 3.07(c) - Condemnation Proceedings
Schedule 3.08 - Subsidiaries
Schedule 3.09 - Litigation
Schedule 3.10 - Certain Defaults
Schedule 3.17 - Environmental Matters
Schedule 3.18 - Insurance
Schedule 3.19(d) - Mortgage Filing Offices
Schedule 3.20(a) - Owned Real Properties
Schedule 3.20(b) - Leased Real Properties
Schedule 6.01(a) - Indebtedness to be Paid
Schedule 6.02(a) - Existing Liens
Schedule 6.03(c) - European Investments
Exhibits
--------
Exhibit A - Administrative Questionnaire
Exhibit B - Form of Term Note
Exhibit C - Form of Revolving Credit Note
Exhibit D - Form of Swingline Note
Exhibit E - Form of Borrowing Request
Exhibit F - Form of Continuation/Conversion Request
Exhibit G - Form of Letter of Credit Request
Exhibit H - Form of Assignment and Acceptance
Exhibit I - Form of Amended and Restated Security Agreement
Exhibit J - Form of Pledge Agreement
Exhibit K - Form of Mortgage
Exhibit L - Form of Holding Guarantee Agreement
Exhibit M - Form of Subsidiary Guarantee Agreement
Exhibit N - Form of Indemnity, Subrogation and Contribution Agreement
Exhibit O - Form of Pricing Adjustment Certificate
Exhibit P - Form of Xxxxxxx & XxXxxxxx, special California counsel to Holding
and the Borrower
Exhibit Q - Form of Opinion of Xxxxxxxx & O'Neil, special New York counsel for
Holding and Borrower
Exhibit R - Form of Opinion of Borrower's Local Counsel
i
Exhibit 10.1
Exhibit S - Form of Master Assignment and Exchange Agreement
Exhibit T - Form of Nonrecourse Pledge Agreement
ii
Exhibit 10.1
AMENDED AND RESTATED CREDIT AGREEMENT dated as of May
14, 2002, among XXXXXX RESPIRATORY CARE INC., a
California corporation (the "Borrower"), RIVER
HOLDING CORP., a Delaware corporation ("Holding"),
the Lenders (as defined in Article I), and DEUTSCHE
BANK TRUST COMPANY AMERICAS, a New York banking
corporation, as swingline lender (in such capacity,
the "Swingline Lender"), and as issuing bank (in such
capacity, the "Issuing Bank"), and as administrative
agent (in such capacity, the "Administrative Agent")
and as collateral agent (in such capacity, the
"Collateral Agent") for the Lenders.
The Borrower has requested the Lenders to amend and restate
this Agreement to reflect the assignment, exchange and cancellation of a portion
of the Term Loans as of the Effective Date, to modify certain of the covenants
as set forth herein, to extend the final maturity date of the loans and
commitments as set forth herein and to make other modifications to this
Agreement, all as more specifically set forth herein and on the terms and
subject to the conditions set forth herein the Lenders, Swingline Lender,
Issuing Bank, Administrative Agent and Collateral Agent have agreed to amend
this Agreement in the manner set forth herein. Accordingly, the parties hereto
agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms shall have the meanings specified below:
"ABR Borrowing" means a Borrowing comprised of ABR Loans.
"ABR Loan" means any ABR Term Loan or ABR Revolving Loan.
"ABR Revolving Loan" means any Revolving Loan bearing interest
at a rate determined by reference to the Alternate Base Rate in accordance with
the provisions of Article II.
"ABR Term Borrowing" means a Borrowing comprised of ABR Term
Loans.
"ABR Term Loan" means any Term Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.
"Acquisition Agreement" means the Amended and Restated Merger
Agreement, dated as of March 15, 1998, among Holding, River Acquisition Corp.,
the Borrower and the Sellers, as amended and otherwise modified from time to
time with the consent of the Agents.
"Acquisition Loans" has the meaning set forth in Section
3.13(e)(1).
"Additional Equity" means (a) Capital Stock of Holding or the
Borrower issued in exchange for up to $18,000,000 in cash proceeds paid by
Xxxxxxx Xxxxxx, an Affiliate of Xxxxxxx
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Exhibit 10.1
Spogli, management of Holding and/or the Borrower and other existing
shareholders of Holding and/or the Borrower so long as such cash proceeds are
either contributed to the Borrower or used to purchase Capital Stock of the
Borrower on or prior to the Fifth Amendment Effective Date plus (b) any Capital
Stock of Holding or the Borrower issued upon conversion of the FS Convertible
Senior Subordinated Debt which Capital Stock, to the extent constituting Capital
Stock of the Borrower, shall be pledged to the Administrative Agent pursuant to
a non-recourse Pledge Agreement, satisfactory in form and substance to
Administrative Agent, by the holders thereof.
"Adjusted EBITDA" means, with respect to the Borrower and its
Subsidiaries for the four most recently completed fiscal quarters for which
financial statements are available, EBITDA on a consolidated basis after giving
effect to all Asset Acquisitions or Stock Acquisitions consummated during such
period on a pro forma basis (as if such acquisitions were made on the first day
of such period), plus the pro forma cost savings for such period calculated,
without duplication (a) in accordance with Regulation S-X under the Securities
Exchange Act of 1934, as amended, and (b) good faith estimates by management and
approved by the Administrative Agent of the results of determined events which
have been notified to the Administrative Agent in writing in reasonable detail
and do not exceed 20% of the reported EBITDA of the acquired business for
previous four quarters.
"Adjusted Eurodollar Rate" means, with respect to any
Eurodollar Borrowing for any Interest Period, an interest rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the product of
(a) the Eurodollar Rate in effect for such Interest Period and (b) Statutory
Reserves.
"Adjusted Working Capital" means, for any date, current assets
(other than cash and cash equivalent investments) less current liabilities
(other than current maturities of long-term debt).
"Administrative Agent" has the meaning assigned thereto in the
Preamble hereto.
"Administrative Agent Fees" has the meaning assigned thereto
in Section 2.05(b).
"Administrative Questionnaire" means an Administrative
Questionnaire in the form of Exhibit A.
"Affiliate" means, when used with respect to a specified
person, another person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by or is under common Control with the
person specified.
"Affiliate Transactions" has the meaning assigned thereto in
Section 6.06.
"Aggregate Revolving Credit Exposure" means the aggregate
amount of the Lenders' Revolving Credit Exposures.
"Alternate Base Rate" means, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest of
(a) the Prime Rate in effect on such day, (b) the Base CD Rate in effect on such
day plus 1% and (c) the Federal Funds Effective Rate in effect on such day plus
1/2 of 1%. If for any reason the Administrative Agent shall have determined
(which determination shall be conclusive absent manifest error) that it is
unable to
2
Exhibit 10.1
ascertain the Base CD Rate or the Federal Funds Effective Rate or both for any
reason, including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) or (c),
or both, of the preceding sentence, as appropriate, until the circumstances
giving rise to such inability no longer exist. Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Base CD Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change in the
Prime Rate, the Base CD Rate or the Federal Funds Effective Rate, respectively.
The term "Prime Rate" means the rate of interest per annum publicly announced
from time to time by the Administrative Agent as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced as being effective. The
term "Base CD Rate" means the sum of (a) the product of (i) the Three-Month
Secondary CD Rate and (ii) Statutory Reserves and (b) the Assessment Rate. The
term "Federal Funds Effective Rate" means, for any day, the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"Applicable Percentage" of any Revolving Credit Lender at any
time means the percentage of the Total Revolving Credit Commitment represented
by such Lender's Revolving Credit Commitment. In the event the Revolving Credit
Commitments shall have expired or been terminated, the Applicable Percentages
shall be determined on the basis of the Revolving Credit Commitments most
recently in effect.
"Assessment Rate" means for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will be
employed in determining amounts payable by the Administrative Agent to the
Federal Deposit Insurance Corporation (or any successor thereto) for insurance
by such Corporation (or such successor) of time deposits made in dollars at the
Administrative Agent's domestic offices.
"Asset Acquisition" means a purchase, lease or other
acquisition of all or substantially all of the Assets of any person or of a
division or business of any person.
"Asset Disposition" means any sale, lease, transfer, issuance
or other disposition (or series of related sales, leases, transfers, issuances
or dispositions) by Holding, the Borrower or any Restricted Subsidiary,
including any disposition by means of a merger, consolidation or similar
transaction (each referred to for the purposes of this definition as a
"disposition"), of (a) any shares of Capital Stock of a Restricted Subsidiary
(other than directors' qualifying shares) or (b) any other Assets of the
Borrower or any Restricted Subsidiary outside of the ordinary course of business
of the Borrower or such Restricted Subsidiary (other than, in the case of
clauses (a) and (b) above, (i) any disposition by a Restricted Subsidiary to the
Borrower or by the Borrower or a Restricted Subsidiary to a wholly owned
Restricted Subsidiary, (ii) any disposition effected in compliance with Section
6.04). "Asset Disposition" shall not include (i) any Sale/Leaseback Transaction,
(ii) the Investments by the Borrower in Swedish Acquisitionco, US Holdco and
Euro Holdco as described in Annex 4, or (iii) so long as no Default or Event of
Default has occurred
3
Exhibit 10.1
and is continuing, the making of an Investment by the Borrower in Swedish
Acquisitionco, US Holdco and Euro Holdco with the proceeds of any Designated
Capital Investment.
"Assets" means property of any person other than capital
stock, or warrants, instruments or rights convertible into capital stock, of any
person.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit H or such other form as shall be approved by the
Administrative Agent.
"Average Life" means, as of any date of determination, with
respect to any Debt or Preferred Stock, the quotient obtained by dividing (a)
the sum of the product of the numbers of years (rounded to the nearest
one-twelfth of one year) from the date of determination to the dates of each
successive scheduled principal payment of such Debt or redemption or similar
payment with respect to such Preferred Stock multiplied by the amount of such
payment by (b) the sum of all such payments.
"Board" means the Board of Governors of the Federal Reserve
System of the United States of America.
"Borrower" has the meaning assigned thereto in the Preamble
hereto.
"Borrowing" means a group of Loans of a single Type made by
the Lenders on a single date and as to which a single Interest Period is in
effect.
"Borrowing Request" means a request by the Borrower in
accordance with the terms of Section 2.03 or Section 2.22(b), as the case may
be, and substantially in the form of Exhibit E.
"Business Day" means any day other than a Saturday, Sunday or
day on which banks in New York City and Los Angeles are authorized or required
by law to close.
"Capital Expenditures" means capital expenditures of the
Borrower and its Subsidiaries determined in accordance with GAAP, excluding a
cumulative amount of up to $4,000,000 of SAP Computer Capital Expenditures and
excluding up to $1,000,000 per fiscal year of expenditures related to the
production and repair of heaters used in Borrower's heated humidification system
products, including CONCHATHERM heated humidifiers.
"Capital Lease Obligations" of any person means the
obligations of such person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capital Stock" mean, with respect to any person, any shares
or other equivalents (however designated) of corporate stock, partnership
interests or any other participants, rights, warrants, options or other
interests in the nature of any equity interest in such person, including
Preferred Stock, but excluding any debt security convertible or exchangeable
into such equity interest.
4
Exhibit 10.1
"Casualty" has the meaning assigned thereto in Section 5.12(a).
"Casualty Proceeds" has the meaning assigned thereto in Section
5.12(a).
"Change of Control" means the occurrence of any of the following
events:
(a) prior to the first Public Equity Offering that results in a
Public Market, the Permitted Holders cease to be the "beneficial owners" (as
defined in Rule 13d-3 under the Exchange Act, except that a person will be
deemed to have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of a majority of the voting power
of the Voting Stock of the Borrower, whether as a result of the issuance of
securities of the Borrower, any merger, consolidation, liquidation or
dissolution of the Borrower, any direct or indirect transfer of securities by
the Permitted Holders or otherwise (for purposes of this clause, the Permitted
Holders will be deemed to beneficially own any Voting Stock of a corporation
(the "specified corporation") held by any other corporation (the "parent
corporation") so long as the Permitted Holders beneficially own, directly or
indirectly, in the aggregate a majority of the voting power of the Voting Stock
of such parent corporation); or
(b) after the first Public Equity Offering that results in a
Public Market, any "person" or "group" (as such terms are used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act or any successor provisions to either
of the foregoing), including any group acting for the purpose of acquiring,
holding, voting or disposing of securities within the meaning of Rule
13d-5(b)(1) under the Exchange Act, other than any one or more of the Permitted
Holders, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act, except that a person will be deemed to have "beneficial ownership"
of all shares that any such person has the right to acquire, whether such right
is exercisable immediately or only after the passage of time), directly or
indirectly, of 25% or more of the voting power of the Voting Stock of the
Borrower; provided, however, that the Permitted Holders are the "beneficial
owners" (as defined in Rule 13d-3 under the Exchange Act, except that a person
will be deemed to have "beneficial ownership" of all shares that any such person
has the right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, in the aggregate of a lesser
percentage of the total voting power of all classes of the Voting Stock of the
Borrower than such other person or group (for purposes of this clause, such
person or group shall be deemed to beneficially own any Voting Stock of a
specified corporation held by a parent corporation so long as such person or
group beneficially owns, directly or indirectly, in the aggregate a majority of
the voting power of the Voting Stock of such parent corporation); or
(c) the sale, transfer, assignment, lease, conveyance or other
disposition, directly or indirectly, of all or substantially all the assets of
the Borrower and the Restricted Subsidiaries, considered as a whole (other than
a disposition of such assets as an entirety or virtually as an entirety to a
wholly owned Subsidiary or one or more Permitted Holders) shall have occurred,
or the Borrower merges, consolidates or amalgamates with or into any other
person (other than one or more Permitted Holders) or any other person (other
than one or more Permitted Holders) merges, consolidates or amalgamates with or
into the Borrower, in any such event pursuant to a transaction in which the
outstanding Voting Stock of the Borrower is reclassified into or exchanged for
cash, securities or other Property, other than any such transaction where (i)
the outstanding Voting Stock of the Borrower is reclassified into or exchanged
for Voting Stock of
5
Exhibit 10.1
the surviving corporation and (ii) the holders of the Voting Stock of the
Borrower immediately prior to such transaction own, directly or indirectly, not
less than a majority of the Voting Stock of the surviving corporation
immediately after such transaction and in substantially the same proportion as
before the transaction; or
(d) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Board of Directors (together
with any new directors whose election or appointment by such Board or whose
nomination for election by the shareholders of the Borrower was approved by a
vote of 66-2/3% of the directors then still in office who were either directors
at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors then in office; or
(e) the shareholders of the Borrower shall have approved any
plan of liquidation or dissolution of the Borrower; or
(d) any transaction or series of related transactions
constituting a "change of control" or other similar occurrence under
documentation evidencing or governing any Indebtedness of the Borrower or its
Restricted Subsidiaries of $2,500,000 or more which results in an obligation of
the Borrower or any Restricted Subsidiary to prepay, purchase, offer to
purchase, redeem or defease such Indebtedness.
"Closing Date" means the date (which shall be on or prior to
April 16, 1998) of the first Credit Event.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" means all the "Collateral" as defined in any
Security Document and shall also include the Mortgaged Properties.
"Collateral Agent" has the meaning assigned thereto in the
Preamble hereto.
"Commitment" means, with respect to any Lender, such Lender's
Revolving Credit Commitment, Term Loan Commitment and Swingline Commitment.
"Commitment Fee" has the meaning assigned thereto in Section
2.05(a).
"Condemnation" has the meaning assigned thereto in Section
5.12(b).
"Condemnation Proceeds" has the meaning assigned thereto in
Section 5.12(b).
"Confidential Information Memorandum" means the Confidential
Information Memorandum of the Borrower dated February 16, 1998.
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Borrower and its consolidated Restricted Subsidiaries,
other than any non-cash interest expense with respect to the FS Convertible
Senior Subordinated Debt, plus, to the extent not included in such total
interest expense, and to the extent Incurred by the Borrower or its Restricted
Subsidiaries, (a) interest expense attributable to capital leases, (b)
amortization of Indebtedness
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Exhibit 10.1
discount and debt issuance cost, including commitment fees, (c) capitalized
interest, (d) non-cash interest expenses other than any non-cash interest
expense with respect to the FS Convertible Senior Subordinated Debt, (e)
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing, (f) net costs associated with
Hedging Obligations (including amortization of fees), (g) dividends and other
distributions on Disqualified Stock, (h) Preferred Stock dividends in respect of
all Preferred Stock of Restricted Subsidiaries held by persons other than the
Borrower or a wholly owned Subsidiary (to the extent paid in cash), and (i)
interest Incurred in connection with Investments in discontinued operations.
"Consolidated Net Income" means, for any period, the net income
(loss) of the Borrower and its consolidated Subsidiaries; provided, however,
that there shall not be included in such Consolidated Net Income (a) any net
income (loss) of any person (other than the Borrower) if such person is not a
Restricted Subsidiary, except that (i) subject to the exclusion contained in
clause (d), the Borrower's equity in the net income of any such person for such
period shall be included in such Consolidated Net Income up to the aggregate
amount of cash distributed by such person during such period to the Borrower or
a Restricted Subsidiary as a dividend or other distribution (subject, in the
case of a dividend or other distribution to a Restricted Subsidiary, to the
limitations contained in clause (c)) and (ii) the Borrower's equity in a net
loss of any such person other than an Unrestricted Subsidiary for such period
shall be included in determining such Consolidated Net Income, (b) for the
purposes of Section 6.06 only, any net income (loss) of any person acquired by
the Borrower or any of its consolidated Subsidiaries in a pooling of interests
transaction for any period prior to the date of such acquisition, (c) any net
income (but not loss) of any Restricted Subsidiary if such Restricted Subsidiary
is subject to restrictions, directly or indirectly, on the payment of dividends
or the making of distributions, directly or indirectly, to the Borrower, except
that subject to the exclusion contained in clause (d), the Borrower's equity in
the net income of any such Restricted Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate amount of cash
distributed by such Restricted Subsidiary during such period to the Borrower or
another Restricted Subsidiary as a dividend or other distribution (subject, in
the case of a dividend or other distribution to another Restricted Subsidiary,
to the limitation contained in this clause), (d) any gain (but not loss)
realized upon the sale or other disposition of any Property of the Borrower or
any of its consolidated Subsidiaries (including pursuant to any Sale and
Leaseback Transaction) which is not sold or otherwise disposed of in the
ordinary course of business; provided, that any tax benefit or tax liability
resulting therefrom shall be excluded in calculating such Consolidated Net
Income, (e) any extraordinary gain or loss; provided, that any tax benefit or
tax liability resulting therefrom shall be excluded in calculating such
Consolidated Net Income, (f) the cumulative effect of a change in accounting
principles, (g) any non-cash compensation expense realized for grants of
performance shares, stock options or other stock awards to officers, directors
and employees of the Borrower or any Restricted Subsidiary, (h) compensation
expense realized with respect to periods prior to the Closing Date in respect of
payments under the Borrower's 1994 Amended and Restated Equity Participation
Plan, (i) Contingent Acquisition-Related Payments; (j) fees and expenses
incurred in connection with the Recapitalization and referred to in Section
4.02(s) to the extent the same would otherwise constitute an expense which would
be deducted in calculating Consolidated Net Income; (k) compensation expense
realized with respect to retention bonuses paid in connection with the
Recapitalization to employees of the Borrower or any Subsidiary in an amount not
to exceed $4,400,000, to the extent such expense was paid from the Redemption
Amount, and (l) any expense attributable to taxes incurred by the Borrower as a
result of its making the election under
7
Exhibit 10.1
Section 338(h)(10) of the Code in connection with the Recapitalization in an
amount not to exceed $2,800,000.
"Contingent Acquisition-Related Payments" means
(a) payments to the Sellers pursuant to the Acquisition
Agreement in an aggregate amount not to exceed $1,100,000 in any fiscal year or
$3,300,000 in the aggregate after the Closing Date while any Loans are
outstanding (plus, in each case, interest due on the unpaid portion of such
required payment in accordance with the Acquisition Agreement); and
(b) compensation expense, to the extent accrued in 1998, related
to contingent payments to existing managers of the Borrower pursuant to the
Acquisition Agreement in an aggregate amount not in excess of $2,400,000.
"Continuation/Conversion Request" means a continuation/conversion
request delivered by the Borrower to the Administrative Agent, in the form of
Exhibit F or such other form as shall be approved by the Administrative Agent.
"Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "Controlling" and "Controlled" shall have meanings
correlative thereto.
"Credit Documents" means this Agreement, the Letters of Credit,
the Notes, the Subsidiary Guarantee Agreement, Holding Guarantee Agreement, the
Security Documents, the Indemnity, Subrogation and Contribution Agreement, the
Nonrecourse Pledge Agreement and the Master Assignment and Exchange Agreement.
"Credit Event" has the meaning assigned thereto in Section 4.01.
"Credit Parties" means the Borrower and the Guarantors.
"Debt" means, with respect to any person, all Indebtedness of
such person of the types referred to in clauses (a), (b), (c), (d), (e), (f) and
(h) of the definition of "Indebtedness".
"Debt/Adjusted EBITDA Ratio" means, as of any date with respect
to the Borrower and its consolidated Restricted Subsidiaries, (a) the total
amount of Debt of the Borrower and its consolidated Restricted Subsidiaries,
excluding any FS Convertible Senior Subordinated Debt, as of such date to (b)
Adjusted EBITDA of the Borrower and its consolidated Subsidiaries for the period
of four fiscal quarters most recently ended for which financial statements are
available.
"Default" means any event or condition which upon notice, lapse
of time or both would constitute an Event of Default.
"Designated Capital Investment" means any equity Investment in
Holding (other than the Investments described in Annex 4), the proceeds of which
are invested by Holding in the Borrower in the form of equity, with respect to
which the Borrower has notified the Administrative Agent in advance in writing
that the proceeds of such investment are to be invested or loaned by the
Borrower to Swedish Acquisitionco, US Holdco or Euro Holdco.
8
Exhibit 10.1
"Disqualified Stock" means, with respect to any person,
Redeemable Stock of such person as to which (i) the maturity, (ii) mandatory
redemption or (iii) redemption, repurchase, conversion or exchange at the option
of the holder thereof occurs, or may occur, on or prior to the first anniversary
of the Loan Maturity Date; provided, however, that Redeemable Stock of such
person that would not otherwise be characterized as Disqualified Stock under
this definition shall not constitute Disqualified Stock (a) if such Redeemable
Stock is convertible or exchangeable into Debt or Disqualified Stock solely at
the option of the issuer thereof or (b) solely as a result of provisions thereof
giving holders thereof the right to require such person to repurchase or redeem
such Redeemable Stock upon the occurrence of a "change of control" occurring
prior to the first anniversary of the Loan Maturity Date, if (x) such repurchase
obligation may not be triggered in respect of such Redeemable Stock unless a
mandatory prepayment obligation also arises with respect to the Loans and (y) no
such repurchase or redemption is permitted to be consummated unless and until
such person shall have satisfied all mandatory prepayment obligations with
respect to the Loans.
"dollars" or "$" means lawful money of the United States of
America.
"Domestic Subsidiaries" means all Restricted Subsidiaries
incorporated or organized under the laws of the United States of America, any
State thereof or the District of Columbia.
"EBITDA" means, for any period, an amount equal to, for the
Borrower and its consolidated Restricted Subsidiaries, the sum of Consolidated
Net Income for such period, plus the following to the extent reducing
Consolidated Net Income for such period and without duplication: (i) the
provision for taxes based on income or profits or utilized in computing net
loss, (ii) Consolidated Interest Expense plus any noncash interest expense with
respect to the FS Convertible Senior Subordinated Debt, (iii) depreciation, (iv)
amortization, (v) nonrecurring restructuring charges not to exceed a maximum
aggregate amount of $1,500,000 and (vi) other noncash charges to the extent
approved by Administrative Agent, plus or minus the Intercompany Receivable
Adjustment to EBITDA. Notwithstanding the foregoing, the provision for taxes
based on the income or profits of, and the depreciation and amortization of, a
Restricted Subsidiary shall be added to Consolidated Net Income to compute
EBITDA only to the extent (and in the same proportion) that the net income of
such Restricted Subsidiary was included in calculating Consolidated Net Income
and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Borrower by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its shareholders.
"Effective Date" means the date on or prior to May 15, 2002 on
which the conditions set forth in Section 4.02 have been satisfied.
Administrative Agent shall notify Borrower and Lenders upon the occurrence of
the Effective Date.
"Employee Notes" means promissory notes of employees of the
Borrower, Holding or their Subsidiaries payable to the Borrower or Holding and
received in connection with the substantially concurrent purchase of Capital
Stock of the Borrower or Holding by such employees.
9
Exhibit 10.1
"environment" means ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, the workplace or as otherwise defined in any Environmental
Law.
"Environmental Claim" means any written accusation, allegation,
notice of violation, claim, demand, order, directive, cost recovery action or
other cause of action by, or on behalf of, any Governmental Authority or any
person for damages, injunctive or equitable relief, personal injury (including
sickness, disease or death), Remedial Action costs, tangible or intangible
property damage, natural resource damages, nuisance, pollution, any adverse
effect on the environment caused by any Hazardous Material, or for fines,
penalties or restrictions, resulting from or based upon (a) the existence, or
the continuation of the existence, of a Release (including sudden or non-sudden,
accidental or non-accidental Releases), (b) exposure to any Hazardous Material,
(c) the presence, use, handling, transportation, storage, treatment or disposal
of any Hazardous Material or (d) the violation or alleged violation of any
Environmental Law or Environmental Permit.
"Environmental Law" means any and all applicable present and
future treaties, laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
Release or threatened Release of any Hazardous Material or to health and safety
matters, including the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. (S)(S) 9601 et seq. (collectively
"CERCLA"), the Solid Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42
U.S.C. (S)(S) 6901 et seq., the Federal Water Pollution Control Act, as amended
by the Clean Water Act of 1977, 33 U.S.C. (S)(S) 1251 et seq., the Clean Air Act
of 1970, as amended 42 U.S.C. (S)(S) 7401 et seq., the Toxic Substances Control
Act of 1976, 15 U.S.C. (S)(S) 2601 et seq., the Occupational Safety and Health
Act of 1970, as amended, 29 U.S.C. (S)(S) 651 et seq., the Emergency Planning
and Community Right-to-Know Act of 1986, 42 U.S.C. (S)(S) 11001 et seq., the
Safe Drinking Water Act of 1974, as amended, 42 U.S.C. (S)(S) 300(f) et seq.,
the Hazardous Materials Transportation Act, 49 U.S.C. (S)(S) 5101 et seq., and
any similar or implementing state or local law, and all amendments or
regulations promulgated under any of the foregoing.
"Environmental Permit" means any permit, approval, authorization,
certificate, license, variance, filing or permission required by or from any
Governmental Authority pursuant to any Environmental Law.
"Environmental Property" has the meaning assigned thereto in
Section 3.17(a).
"Equity Issuance" means, for any period, an amount equal to, for
the Borrower and its consolidated Restricted Subsidiaries, (a) the sum of
Consolidated Net Income for such period, plus the following to the extent
reducing Consolidated Net Income for such period: (i) the provision for taxes
based on income or profits or utilized in computing net loss, (ii) Consolidated
Interest Expense plus any noncash interest expense with respect to the FS
Convertible Senior Subordinated Debt, (iii) depreciation, (iv) amortization, (v)
any other non-cash items (other than any such non-cash item to the extent that
it represents an accrual of or reserve for cash expenditures in any future
period), minus (b) all non-cash items increasing Consolidated Net
10
Exhibit 10.1
Income for such period (other than any such non-cash item to the extent that it
will result in the receipt of cash payments in any future period).
"ERISA" means the Employee Retirement Income Security Act of
1974, as the same may be amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan; (b) the adoption of any amendment to a Plan that would require the
provision of security pursuant to Section 401(a)(29) of the Code or Section 307
of ERISA; (c) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (d) the filing pursuant to Section 412(d) of the Code or
Section 303(d) of ERISA of an application for a waiver of the minimum funding
standard with respect to any Plan; (e) the incurrence of any liability under
Title IV of ERISA with respect to the termination of any Plan or the withdrawal
or partial withdrawal of the Borrower or any of its ERISA Affiliates from any
Plan or Multiemployer Plan; (f) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator of any notice relating to the
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (g) the receipt by the Borrower or any ERISA Affiliate of any notice
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; (h) the occurrence of a "prohibited
transaction" with respect to which the Borrower or any of its Subsidiaries is a
"disqualified person" (within the meaning of Section 4975 of the Code) or with
respect to which the Borrower or any such Subsidiary could otherwise be liable;
and (i) any other event or condition with respect to a Plan or Multiemployer
Plan that could reasonably be expected to result in liability of the Borrower.
"Eurodollar Borrowing" means a Borrowing comprised of Eurodollar
Loans.
"Eurodollar Loan" means any Eurodollar Revolving Loan or
Eurodollar Term Loan.
"Eurodollar Rate" means, with respect to any Eurodollar
Borrowing, the rate (rounded upwards, if necessary, to the next 1/16 of 1%) at
which dollar deposits approximately equal in principal amount to the
Administrative Agent's portion of such Eurodollar Borrowing and for a maturity
comparable to such Interest Period are offered to the principal New York office
of the Administrative Agent in immediately available funds in the London
interbank market at approximately 10:00 a.m., New York time, two Business Days
prior to the commencement of such Interest Period.
"Eurodollar Revolving Loan" means any Revolving Loan bearing
interest at a rate determined by reference to the Adjusted Eurodollar Rate in
accordance with the provisions of Article II.
11
Exhibit 10.1
"Eurodollar Term Borrowing" means a Borrowing comprised of
Eurodollar Term Loans.
"Eurodollar Term Loan" means any Term Loan bearing interest at a
rate determined by reference to the Adjusted Eurodollar Rate in accordance with
the provisions of Article II.
"Euro Holdco" is defined in Annex 4.
"Event of Default" has the meaning assigned thereto in Section
7.01.
"Excess Cash Flow" for any period, means EBITDA for such period,
less the sum of
(a) (i) permitted Capital Expenditures, (ii) taxes of the
Borrower and the Subsidiaries paid or payable in cash for such period, (iii)
cash consideration paid for Permitted Acquisitions (but excluding cash
consideration funded by a Borrowing under the Revolving Credit Commitments),
(iv) Consolidated Interest Expense, (v) increases in Adjusted Working Capital
for such period, (vi) scheduled and mandatory payments of Debt, (vii) payments
pursuant to Section 6.05(a)(i)(A) in connection with purchases of Excluded
Shares, (viii) Contingent Acquisition-Related Payments, (ix) compensation
payments made in such period in respect of amounts excluded from the definition
of "Consolidated Net Income" by virtue of clause (h) thereof, and (x) dividends
paid with respect to the Borrower's Exchangeable Preferred Stock to the extent
permitted by Section 6.05(a)(ii), in each case to the extent made in cash during
such period;
plus the sum of
(b) (i) decreases in Adjusted Working Capital for such period,
(ii) refunds of taxes paid in prior periods, and (iii) proceeds to the Borrower
or any Restricted Subsidiary of any Indebtedness referred to in Section 6.01(f),
in each case to the extent received in cash or cash equivalents during such
period.
"Exchangeable Preferred Stock" means (a) with respect to the
Borrower, 300,000 shares of the Borrower's 11 1/2% Senior PIK Preferred Stock
due 2010, liquidation preference $100 per share, and such additional shares of
Borrower's 11 1/2% Senior PIK Preferred Stock due 2010 as may be issued in lieu
of cash dividends thereon, and (b) with respect to Holding, 300,000 Shares of
Holding's 11 1/2% Senior Exchangeable PIK Preferred Stock Due 2010 (Liquidation
Preference $100 Per Share) and such additional shares of Holdings 11 1/2% Senior
Exchangeable PIK Preferred Stock Due 2010 as may be issued in lieu of cash
dividends thereon.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Excluded Shares" means Capital Stock of Holding, issued to an
employee of Holding, the Borrower or any Subsidiary of the Borrower pursuant to
any stock option, stock purchase, stock incentive or other similar plan of
Holding, the Borrower or any Subsidiary of the Borrower established for the
benefit of their employees (collectively, an "Employee Stock Issuance"), or any
Capital Stock of the Borrower issued to Holding in consideration of the
contribution by Holding to Borrower of the cash proceeds of any such Employee
Stock Issuance.
12
Exhibit 10.1
"Existing Letters of Credit" means each Letter of Credit
previously issued for the account of the Borrower that (a) is outstanding on the
Closing Date and (b) is listed on Schedule 1.01(a).
"Fair Market Value" means, with respect to any Property, the
price which could be negotiated in an arm's-length free market transaction, for
cash, between a willing seller and a willing buyer, neither of whom is under
undue pressure or compulsion to complete the transaction.
"Fee Letter" means the Fee Letter dated February 3, 1998,
among the Borrower, the Administrative Agent and the Syndication Agent.
"Fees" means the Commitment Fees, the fees described in
Section 2.05(c), the Administrative Agent's Fees, the L/C Participation Fees and
the Issuing Bank Fees.
"Fifth Amendment" means that certain Amendment No. 5 and
Limited Waiver to this Agreement dated as of July 30, 2001.
"Fifth Amendment Effective Date" means the date on which the
Fifth Amendment becomes effective pursuant to paragraph 22 thereof.
"Financial Officer" means the Chief Executive Officer or the
Chief Financial Officer of the Borrower.
"Fixed Charge Coverage Ratio" means, with respect to the
Borrower and its Restricted Subsidiaries for any period of four consecutive
fiscal quarters, the ratio of (a) EBITDA for such period, to (b) the sum of
Capital Expenditures paid in cash, Consolidated Interest Expense, scheduled
amortizations of Debt, taxes paid or due and payable (excluding taxes paid
resulting from the Borrower making the election under Section 338(h)(10) of the
Code in 1998 in connection with the Recapitalization in an amount not to exceed
$2,800,000), and dividends or other distributions on the Capital Stock of such
person paid in cash (other than to the Borrower or another Restricted
Subsidiary), in each case for such period.
"Foreign Subsidiary" means any Subsidiary that is not a
Domestic Subsidiary.
"Xxxxxxx Xxxxxx" means Xxxxxxx Xxxxxx & Co. Incorporated, a
Delaware corporation, and Xxxxxxx Xxxxxx & Co. LLC, a Delaware limited liability
company.
"FS Convertible Senior Subordinated Debt" means up to
$15,000,000 in aggregate principal amount of unsecured convertible senior
subordinated notes of the Borrower owing to an Affiliate of Xxxxxxx Xxxxxx,
Xxxxxxx Xxxxxx, management of Holding and/or the Borrower and/or other existing
shareholders of Holding or the Borrower (which may include up to $6,500,000 in
FS Convertible Senior Subordinated Debt issued in April and May 2001 and
Indebtedness outstanding pursuant to Section 6.01(j) hereof), and any unsecured
convertible senior subordinated notes issued in lieu of cash interest thereon,
as the same may be amended, supplemented or otherwise modified from time to time
in accordance with the terms hereof and thereof; provided that (1) interest
shall not be payable in cash on such notes but shall be either accrued and
compounded or shall be payable by the issuance of additional unsecured
convertible senior subordinated notes to the extent such issuance is in
compliance with the requirements of any indenture governing Subordinated
Obligations of the Borrower or any Subsidiary; (2) such notes
13
Exhibit 10.1
shall not mature earlier than March 31, 2005 and shall have no scheduled
amortization or sinking fund payments payable thereon; and (3) payments on or
with respect to such notes shall be subordinated on terms and conditions
substantially in the form attached as Annex A to the Fifth Amendment.
"GAAP" means generally accepted accounting principles applied
on a consistent basis.
"Gibeck AB" is defined in Annex 4.
"Gibeck AB Acquisition" is defined in Annex 4.
"Gibeck Family" is defined in Annex 4.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantee" of or by any person means any obligation,
contingent or otherwise, of such person guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other person (the "primary
obligor") in any manner, whether directly or indirectly, and including any
obligation of such person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (b) to purchase or lease property, securities
or services for the purpose of assuring the owner of such Indebtedness of the
payment of such Indebtedness or (c) to maintain working capital, equity capital
or any other financial statement condition or liquidity of the primary obligor
so as to enable the primary obligor to pay such Indebtedness; provided, however,
that the term "Guarantee" shall not include endorsements for collection or
deposit in the ordinary course of business.
"Guarantee Agreements" means Holding Guarantee Agreement and
the Subsidiary Guarantee Agreement.
"Guarantors" means Holding and the Subsidiary Guarantors.
"Hazardous Materials" means all explosive or radioactive
substances or wastes, hazardous or toxic substances or wastes, pollutants,
solid, liquid or gaseous wastes, including petroleum or petroleum distillates,
asbestos or asbestos containing materials, polychlorinated biphenyls ("PCBs") or
PCB-containing materials or equipment, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Obligations" means, with respect to any person, all
obligations of such person in respect of Interest Rate Agreements, foreign
currency exchange agreements or other interest or exchange rate hedging
arrangements.
"Holding" has the meaning assigned thereto in the Preamble
hereto.
"Holdco" means collectively HRC Holding, Inc., a Delaware
corporation, and Xxxxxx Euro Co S.a.r.l., a Luxembourg corporation.
14
Exhibit 10.1
"Holding Guarantee Agreement" means Holding Guarantee
Agreement, substantially in the form of Exhibit L, made by Holding in favor of
the Collateral Agent for the benefit of the Secured Parties.
"HRC Holding" means HRC Holding, Inc., a Delaware corporation.
"HRC Holding Senior Notes" means the unsecured senior notes of
HRC Holding due December 31, 2004, substantially in the form of the Senior Notes
or as otherwise approved by the Administrative Agent, interest on which shall
not be payable in cash but which interest shall accrue until maturity and the
principal on which shall have no scheduled amortization prior to December 31,
2004, as the same may be amended, supplemented or otherwise modified from time
to time in accordance with the terms hereof. The HRC Holding Senior Notes shall
include the HRC Holding Senior Notes issued on the Effective Date and any HRC
Holding Senior Notes issued thereafter pursuant to Section 6.01(k).
"Immaterial Subsidiary" means any Subsidiary of the Borrower
identified as an Immaterial Subsidiary on Schedule 3.08 and any Subsidiary of
the Borrower formed or acquired after the Effective Date and designated as an
Immaterial Subsidiary on Schedule 3.08, which Subsidiary, (a) does not own
assets with an aggregate value of greater than $25,000, (b) does not generate
revenues of greater than $25,000 in any single fiscal year, and (c) is not
actively engaged in any ongoing business or operations, the assets and revenues
of which are not encumbered or otherwise subject to any claim in favor of any
third party and which has no indebtedness or other liabilities, contingent or
otherwise; provided that all Immaterial Subsidiaries in the aggregate do not own
assets with an aggregate value of greater than $50,000 or generate revenues of
greater than $50,000 in any single fiscal year or such amount in excess of
$50,000 as may be approved in writing by Administrative Agent.
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness or Capital Stock of
a person existing at the time such person becomes a Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred
by such Subsidiary at the time it becomes a Subsidiary. Any Indebtedness issued
at a discount (including Indebtedness on which interest is payable through the
issuance of additional Indebtedness) shall be deemed incurred at the time of
original issuance of the Indebtedness at the initial accreted amount thereof.
"Indebtedness" of any person means, without duplication, (a)
all obligations of such person for borrowed money or with respect to deposits or
advances of any kind held by it, (b) all obligations of such person evidenced by
bonds, debentures, notes or similar instruments, (c) financings of accounts
receivable, (d) all obligations of such person under other title retention
agreements relating to property or assets purchased by such person, (e) all
obligations of such person issued or assumed as the deferred purchase price of
property or services (excluding trade accounts payable and accrued obligations
incurred in the ordinary course of 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 property owned or
acquired by such person, whether or not the obligations secured thereby have
been assumed (measured as the fair market value of such property, (g) all
Guarantees by such person of Indebtedness of others (measured by the amount for
which such person would be liable), (h) all Capital Lease Obligations of such
person , (i) all net Hedging Obligations of such person and (j) all obligations
of such
15
Exhibit 10.1
person as an account party in respect of letters of credit and bankers'
acceptances (other than trade letters of credit and trade bankers' acceptances).
The Indebtedness of any person shall include the Indebtedness of any partnership
in which such person is a general partner.
"Indebtedness to be Paid" has the meaning assigned thereto in
Section 6.01(b).
"Indemnitee" has the meaning assigned thereto in Section
9.05(b).
"Indemnity, Subrogation and Contribution Agreement" means the
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit N, among the Borrower, the Subsidiary Guarantors and the Collateral
Agent.
"Independent Consultant" means a consultant not affiliated
with any Credit Party or any Lender.
"Intercompany Receivable" means the aggregate amount owed to
Borrower and its Restricted Subsidiaries by Borrower's Unrestricted Subsidiaries
for goods sold or leased or services rendered to or for the benefit of
Borrower's Unrestricted Subsidiaries by Borrower and its Restricted
Subsidiaries, net of the aggregate amount owed by Borrower and its Restricted
Subsidiaries to Borrower's Unrestricted Subsidiaries for goods sold or leased to
or services rendered to or for the benefit of Borrower and its Restricted
Subsidiaries by Borrower's Unrestricted Subsidiaries.
"Intercompany Receivable Adjustment to EBITDA" means, for any
quarter, an adjustment for the amount that the Intercompany Receivable exceeds
$3,500,000 on the last day of the quarter, adjusted for the amount that the
Intercompany Receivable balance exceeded $3,500,000 on the last day of the last
quarter, as follows: if the Intercompany Receivable exceeds $3,500,000 in the
current quarter, but did not exceed $3,500,000 in the last quarter, EBITDA will
be reduced by the amount that the Intercompany Receivable exceeds $3,500,000; if
the Intercompany Receivable balance exceeded $3,500,000 in the last quarter,
EBITDA will be: (i) reduced by the amount of increase in the Intercompany
Receivable if the Intercompany Receivable continues to exceed $3,500,000 and
exceeds the amount of the last quarter, (ii) increased by the amount that the
Intercompany Receivable has decreased, so long as it still exceeds $3,500,000,
or (iii) increased by the amount that the Intercompany Receivable exceeded
$3,500,000 in the last quarter, if the Intercompany Receivable no longer exceeds
$3,500,000.
"Interest Payment Date" means, with respect to any Loan, the
last day of the Interest Period applicable to the Borrowing of which such Loan
is a part and, in the case of a Eurodollar Borrowing with an Interest Period of
more than three months' duration, each day that would have been an Interest
Payment Date had successive Interest Periods of three months' duration been
applicable to such Borrowing, and, in addition, the date of any prepayment of
such Borrowing or conversion of such Borrowing to a Borrowing of a different
Type.
"Interest Period" means
(a) as to any Eurodollar Borrowing, the period commencing on
the date of such Borrowing and ending on the numerically corresponding day (or,
if there is no numerically corresponding day, on the last day) in the calendar
month that is 1, 2 or 3 months thereafter, as the Borrower may elect and
16
Exhibit 10.1
(b) as to any ABR Borrowing, the period commencing on the date of such
Borrowing and ending on the earlier of (i) the next succeeding March 31, June
30, September 30 or December 31, and (ii) the Revolving Credit Maturity Date or
the Loan Maturity Date, as applicable,
provided, however, that if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless, in the case of a Eurodollar Borrowing only, such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day.
"Interest Rate Agreement" means, for any person, any interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement or
other similar agreement designed to protect against fluctuations in interest
rates.
"Investment" by any person means any direct or indirect loan (other
than advances to customers in the ordinary course of business that are recorded
as accounts receivable on the balance sheet of such person), advance or other
extension of credit or capital contribution (by means of transfers of cash or
other Property to others or payments for Property or services for the account or
use of others, or otherwise) to, or Incurrence of a Guarantee of any obligation
of, or purchase or acquisition of Capital Stock, bonds, notes, debentures or
other securities or evidence of Indebtedness issued by, any other person. In
determining the amount of any Investment made by transfer of any Property other
than cash, such Property shall be valued at its Fair Market Value at the time of
such Investment.
"Issuing Bank" has the meaning assigned thereto in the Preamble hereto
and Section 2.23(i).
"Issuing Bank Fees" has the meaning assigned thereto in Section
2.05(d).
"L/C Commitment" means the commitment of the Issuing Bank to issue
Letters of Credit pursuant to Section 2.23.
"L/C Disbursement" means a payment or disbursement made by the Issuing
Bank pursuant to a Letter of Credit.
"L/C Exposure" means at any time the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
principal amount of all L/C Disbursements that have not yet been reimbursed at
such time. The L/C Exposure of any Revolving Credit Lender at any time means its
Applicable Percentage of the aggregate L/C Exposure at such time.
"L/C Participation Fee" has the meaning assigned thereto in Section
2.05(c).
"Lenders" means (a) the financial institutions listed on Annex 2
(other than any such financial institution that has ceased to be a party hereto
pursuant to an Assignment and Acceptance) and (b) any financial institution (or
other person approved by Administrative Agent in its sole discretion) that has
become a party hereto pursuant to an Assignment and Acceptance. Unless the
context clearly indicates otherwise, the term "Lenders" shall include the
Swingline Lender.
17
Exhibit 10.1
"Letter of Credit" means any letter of credit issued pursuant to
Section 2.23 and any Existing Letter of Credit.
"Letter of Credit Request" means a letter of credit issuance,
extension or amendment request delivered by the Borrower to the Administrative
Agent, in the form of Exhibit G or such other form as shall be approved by the
Administrative Agent and the applicable Issuing Bank.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.
"Loan Maturity Date" means June 30, 2004.
"Loans" means the Revolving Loans, the Term Loans and the Swingline
Loans.
"Margin Stock" has the meaning assigned thereto in Regulation U.
"Master Assignment and Exchange Agreement" means the Master Assignment
and Exchange Agreement, substantially in the form of Exhibit S, among the
Lenders, the Administrative Agent, Xxxxxxx Xxxxxx or its Affiliates and
Borrower.
"Material Adverse Effect" means (a) a materially adverse effect on the
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and the Subsidiaries, taken as a whole, (b) impairment of the
ability of the Borrower or any other Credit Party to perform any of its
obligations under any Credit Document to which it is or will be a party, which
impairment is material with respect to the Borrower and the other Credit Parties
taken as a whole, or (c) impairment of the rights of or benefits available to
the Lenders under any Credit Document, which impairment is material with respect
to the Borrower and the other Credit Parties taken as a whole, to the Borrower,
or to a Material Subsidiary.
"Material Subsidiary" means a Restricted Subsidiary that, as of the
end of the most recent fiscal quarter for which financial statements are
available accounted for 10% or more of the Borrower's consolidated (i) total
assets, (ii) shareholders' equity, (iii) operating income (calculated for the
four most recently completed fiscal quarters for which financial statements are
available), or (iv) revenues (calculated for the four most recently completed
fiscal quarters for which financial statements are available), determined in
each case in accordance with GAAP.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgaged Properties" means the owned real properties and leasehold
and subleasehold interests of the Credit Parties specified on Schedule 1.01(b).
"Mortgages" means the mortgages, deeds of trust, leasehold mortgages,
assignments of leases and rents, modifications and other security documents
delivered on the
18
Exhibit 10.1
Closing Date, the Effective Date or pursuant to Sections 5.11 or 5.14, each
substantially in the form of Exhibit K or in such other form as is approved by
Administrative Agent.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"Net Cash Proceeds" means, with respect to any Prepayment Event,
(a) all cash or readily marketable cash equivalents received
(including by way of sale, discounting or payment of a note, installment
receivable or other instrument or obligation, but excluding any other
consideration received in the form of assumption by the acquiree of Indebtedness
or other obligations relating to such properties or assets or received in any
other noncash form) therefrom by such person, as part of the consideration for
such Prepayment Event, if applicable) received by or on behalf of Holding, the
Borrower or any Restricted Subsidiary in respect of such Prepayment Event, less
(b) the sum of
(i) the amount, if any, of all taxes (other than taxes based on
income) payable by Holding, the Borrower or any Restricted Subsidiary in
connection with such Prepayment Event and the Borrower's good-faith best
estimate of the amount of all taxes based on income payable in connection
with such Prepayment Event,
(ii) in the case of a Prepayment Event that is a Restricted Asset
Disposition, the amount applied to repay any Indebtedness (other than the
Loans) to the extent such Indebtedness is required by its terms to be
repaid as a result of such Prepayment Event,
(iii) fees, commissions and expenses (including, in the case of
Casualty Proceeds and Condemnation Proceeds, the costs of adjustment and
condemnation proceedings) and other costs paid by Holding, the Borrower or
any Restricted Subsidiary in connection with such Prepayment Event (other
than those payable to the Borrower or any Affiliate of the Borrower), in
each case only to the extent not already deducted in arriving at the amount
referred to in clause (a); and
(iv) all distributions and other payments made to minority interest
holders in Subsidiaries of such person or joint ventures as a result of
such Prepayment Event.
Notwithstanding the foregoing,
(a) no proceeds of any Restricted Asset Disposition (excluding
Excess Real Estate) of fixed or capital assets, no Casualty Proceeds and no
Condemnation Proceeds shall constitute Net Cash Proceeds, to the extent that (x)
such proceeds held by the Borrower or any Restricted Subsidiary to be
reinvested, or are reinvested, in other fixed or capital assets within one year
of such Restricted Asset Disposition and (y) such reinvestment has either (i)
been designated by the Borrower as Capital Expenditures, such Capital
Expenditures are permitted under Section 6.08 and the other fixed or capital
assets in which such reinvestment is made constitute Collateral or (ii) been
approved in writing by the Administrative Agent prior to receipt of such
proceeds by Borrower or any Restricted Subsidiary; provided, that (i) at any
time when the aggregate amount of such proceeds from Restricted Asset
Disposition held for reinvestment exceeds $10,000,000 at
19
Exhibit 10.1
any one time (whether or not such reinvestment has been approved by
Administrative Agent), such excess shall immediately constitute Net Cash
Proceeds, and (ii) at any time when an Event of Default of type described in
Section 7.01(b) or (c) shall have occurred and be continuing, such proceeds
shall immediately constitute Net Cash Proceeds to the extent that the Borrower
has not entered into binding agreements to acquire assets with such proceeds,
and
(b) there shall be excluded from Net Cash Proceeds up to $200,000 of
net proceeds of a single Equity Issuance to be made no more than 90 days after
the Closing Date.
Administrative Agent agrees to respond within 5 Business Days of any request by
Borrower to reinvest such proceeds in accordance with the foregoing clause
(a)(y)(ii) provided that any failure to so respond shall be deemed a denial of
such request to reinvest.
"New Lending Office" has the meaning assigned thereto in Section
2.20(e).
"Nonrecourse Pledge Agreement" means the Nonrecourse Pledge Agreement,
substantially in the form of Exhibit T, between Administrative Agent and Xxxxxxx
Xxxxxx or its Affiliates and any other permitted holders of the Senior Notes,
HRC Holding Senior Notes or any other investments required by this Agreement to
be pledged under such Nonrecourse Pledge Agreement.
"Non-U.S. Lender" has the meaning assigned thereto in Section 2.20(e).
"Notes" means the Term Notes, the Revolving Credit Notes and the
Swingline Notes.
"Obligations" means all obligations defined as "Obligations" in the
Guarantee Agreements and the Security Documents.
"Other Taxes" has the meaning assigned thereto in Section 2.20(b).
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.
"Perfection Certificate" means the Perfection Certificate
substantially in the form of Annex 2 to the Security Agreement.
"Permitted Acquisition" means an Asset Acquisition or a Stock
Acquisition not in the ordinary course of the Borrower's business which in
either case satisfies each of the following conditions:
(a) the Administrative Agent shall receive at least 15 days prior
written notice of such proposed Permitted Acquisition, which notice shall
include a detailed description of such proposed Permitted Acquisition and the
business rationale for such acquisition, and including, in the case of a Stock
Acquisition, financial statements of the Target;
(b) in the case of an Asset Acquisition, such assets shall comprise a
business, or assets of a business, of a type which is the same line of business
as the Borrower, or which is a related or complementary business to that of the
Borrower; and in the case of a Stock Acquisition,
20
Exhibit 10.1
the business of the Target shall be of a type which is the same line of business
as a the Borrower, or which is a related or complementary business to that of
the Borrower; provided, however, that (i) no such acquisition would require the
Administrative Agent or any Lender to obtain regulatory or third party approvals
in connection with the exercise of its rights and remedies under this Agreement
or any other Credit Documents other than approvals required for the exercise of
such rights and remedies with respect to the Borrower prior to such Permitted
Acquisition; and (ii) no such acquisition would result in a material increase in
the regulatory burdens and obligations of the Borrower and its Subsidiaries
taken as a whole;
(c) in the case of a Stock Acquisition, after giving effect
thereto, the Target will either be merged with and into the Borrower, or shall
be a wholly owned Subsidiary of the Borrower;
(d) in the case of a Stock Acquisition, such Permitted
Acquisition shall be consensual and shall have been approved by the Target's
board of directors;
(e) no additional Indebtedness or Guarantees, and no other
material liabilities outside the ordinary course of business, shall be incurred,
assumed or otherwise be reflected on a consolidated balance sheet of the
Borrower after giving effect to such Permitted Acquisition, except (i)
Indebtedness permitted under Section 6.01 and operating leases, and (ii) Debt
Incurred in contemplation of such acquisition for the purposed of financing such
acquisitions consisting of:
(A) Revolving Loans, the aggregate principal amount of which,
when added to the aggregate outstanding principal amount of all other
Revolving Loans made to finance Permitted Acquisitions, shall not
exceed $40,000,000 at any one time outstanding; provided that
notwithstanding anything in this Agreement to the contrary, without the
prior written consent of Required Lenders, no Asset Acquisitions or
Stock Acquisitions shall be permitted on and after the Fifth Amendment
Effective Date; and
(B) unsecured subordinated Debt, in form and substance
satisfactory to the Administrative Agent in all respects which is
permitted pursuant to Section 6.01(h);
(f) the sum of all amounts paid or payable in connection with
any single Permitted Acquisition (including all transaction costs and all
Indebtedness, liabilities and Guarantees and other contingent obligations
incurred or assumed in connection therewith (whether or not reflected on a
consolidated balance sheet of the Borrower) after giving effect to the Permitted
Acquisition) shall not exceed $30,000,000;
(g) in the case of
(i) a Stock Acquisition, the Target shall not have, and
(ii) in the case of an Asset Acquisition for which the
consideration paid is $5,000,000 or more, the acquired assets if
considered as a stand-alone entity on a pro forma basis would not have,
reported negative EBITDA for the four most recently completed fiscal quarters
for which financial statements are available preceding the date of the Permitted
Acquisition, as determined based upon the Target's audited financial statements
for its most recently completed fiscal year and its most
21
Exhibit 10.1
recent interim financial period completed within 60 days prior to the date of
consummation of such Permitted Acquisition;
(h) the business and assets acquired in such Permitted
Acquisition shall be free and clear of all Liens (other than Permitted
Encumbrances);
(i) promptly following the closing of any Permitted
Acquisition, the Collateral Agent will be granted a first priority perfected
Lien (subject to Liens permitted pursuant to Section 6.02) in all assets
acquired pursuant thereto, and the Borrower (and, in the case of a Stock
Acquisition, the Target) shall have executed such documents and taken such
actions as may be required by the Collateral Agent in connection therewith;
(j) concurrently with delivery of the notice referred to in
clause (a), the Borrower shall have delivered to the Administrative Agent, a pro
forma consolidated balance sheet of the Borrower and its Subsidiaries (the
"Acquisition Pro Forma"), based on recent financial data, which shall be
complete and shall accurately and fairly represent the assets, liabilities,
financial condition and results of operations of the Borrower and its
Subsidiaries in accordance with GAAP consistently applied, but taking into
account such Permitted Acquisition and the funding of all Loans in connection
therewith, and such Acquisition Pro Forma shall reflect that;
(i) the Pro Forma Debt/Pro Forma EBITDA Ratio shall not
exceed the following amounts as of the date of such acquisition:
----------------------------------------------------------------------------------------------------------
Acquisition Pro Forma Debt/Pro Forma EBITDA Ratio
Occurring in
Fiscal
Quarter
Ending
Nearest to
----------------------------------------------------------------------------------------
1998 1999 2000 2001 2002 2003 2004
-----------------------------------------------------------------------------------------------------------
March 31 5.75:1.00 5.00:1.00 4.25:1.00 3.50:1.00 3.25:1.00 3.25:1.00
-----------------------------------------------------------------------------------------------------------
June 30 6.00:1:00 5.75:1.00 4.75:1.00 4.00:1.00 3.50:1.00 3.25:1.00
-----------------------------------------------------------------------------------------------------------
September 30 6.00:1:00 5.75:1.00 4.75:1.00 4.00:1.00 3.50:1.00 3.25:1.00
-----------------------------------------------------------------------------------------------------------
December 31 5.75:1.00 5.00:1.00 4.25:1.00 3.50:1.00 3.25:1.00 3.25:1.00
-----------------------------------------------------------------------------------------------------------
and thereafter, 3.25:1.00.
(ii) on a pro forma basis, no Event of Default shall have
occurred and be continuing or would result after giving effect to such
Permitted Acquisition and the Borrower would have been in compliance
with the financial covenants set forth in Section 6.09 through Section
6.12 with a look-back for pro-forma compliance (the "Acquisition
Projections");
(k) the Borrower shall have delivered financial projections
covering the 5-year period commencing on the date of such Permitted Acquisition
based upon historical financial data of a recent date, taking into account such
Permitted Acquisition prepared in a manner consistent
22
Exhibit 10.1
with the financial projections delivered to the Agents in connection with the
closing of this Agreement (the "Closing Projections");
(l) the Borrower shall have delivered a certificate of a
Financial Officer of the Borrower to the effect that: (i) the Borrower will be
solvent upon the consummation of the Permitted Acquisition; (ii) the Acquisition
Pro Forma fairly presents the financial condition of the Borrower and its
Subsidiaries (on a consolidated basis) as of the date thereof after giving
effect to the Permitted Acquisition; and (iii) the Acquisition Projections are
reasonable estimates of the future financial performance of the Borrower
subsequent to the date thereof prepared in a manner consistent with the Closing
Projections of the Borrower (and, in the case of a Stock Acquisition, the
Target) and show that the Borrower shall continue to be in compliance with the
financial covenants set forth in Section 6.09 through Section 6.12 for the
5-year period thereafter;
(m) except where substantially all of the consideration for
such acquisition consists of Capital Stock of the Borrower, on or prior to the
date of such Permitted Acquisition, the Administrative Agent shall have
received, in form and substance satisfactory to the Administrative Agent, all
opinions, certificates, lien search results and other documents reasonably
requested by the Administrative Agent;
(n) the Administrative Agent and the Lenders shall have
received Phase I reports (reasonably satisfactory in scope and substance to the
Agents) with respect to any owned property to be acquired; and
(o) at the time of such Permitted Acquisition and after giving
effect thereto, no Default or Event of Default shall have occurred and be
continuing.
"Permitted Holder" means Xxxxx Xxxxxx Xxxxxx, any member of
senior management of the Borrower or Holding on the Closing Date, Xxxxxxx Xxxxxx
or any successor entity thereof controlled by the principals of Xxxxxxx Xxxxxx
and any entity controlled by, or under common control with, Xxxxxxx Xxxxxx.
"Permitted Investments" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days
from the date of acquisition thereof and having, at such date of acquisition, a
rating of A1/P1 from S&P and from Moody's;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within one year from the date of
acquisition thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States of America or any State
thereof that has a combined capital and surplus and undivided profits of not
less than $250,000,000;
23
Exhibit 10.1
(d) other investment instruments approved in writing by the
Required Lenders and offered by financial institutions which have a combined
capital and surplus and undivided profits of not less than $250,000,000; and
(e) interests in mutual funds which invest primarily in
instruments described in clauses (a), (b) and (c).
"Permitted Purchase Money Lien" means (a) purchase money and
similar Liens existing on the Closing Date or (b) Liens applicable to real
property, improvements thereto or equipment or other Property acquired or
constructed after the Closing Date by the Borrower or any Restricted Subsidiary;
provided that (i) such security interests are incurred, and the Indebtedness
secured thereby is created, no later than 12 months after such acquisition (or
completion of construction), and (ii) such security interests do not apply to
any other property or assets of the Borrower or any Subsidiary.
"person" means any natural person, corporation, business
trust, joint venture, association, company, partnership or government, or any
agency or political subdivision thereof.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 307 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreement" means the Pledge Agreement, substantially
in the form of Exhibit J, between the Borrower, Holding, the Subsidiaries party
thereto and the Collateral Agent for the benefit of the Secured Parties.
"Preferred Stock" means any Capital Stock of a person, however
designated, which entitles the holder thereof to a preference with respect to
the payment of dividends, or as to the distribution of assets upon any voluntary
or involuntary liquidation or dissolution of such person, over shares of any
other class of Capital Stock issued by such person.
"Prepayment Event" means any Incurrence of Debt of the
Borrower or any Restricted Subsidiary, any Equity Issuance (other than the
issuance of shares of the Borrower to Holding or of Holding in connection with
the Gibeck AB Acquisition), any Restricted Asset Disposition, any Restricted
Sale/Leaseback Transaction, any Casualty or any Condemnation.
"Pricing Adjustment" shall mean, for any day, with respect to
any Loan or with respect to the Commitment Fees, as the case may be, the Pricing
Adjustment set forth below, based upon the Debt/Adjusted EBITDA Ratio as of the
date of determination:
24
Exhibit 10.1
Category 1 Category 2 Category 3 Category 4 Category 5
Debt/Adjusted Debt/Adjusted Debt/Adjusted
Debt/Adjusted EBITDA EBITDA Ratio EBITDA Ratio EBITDA Ratio
Ratio less than less than less than Debt/Adjusted
greater than or 5.5:1.0 and 4.75:1.0 and 4.0:1.0 and EBITDA Ratio
equal to greater than or greater than or greater than or less than
5.5:1.0 equal to 4.75:1.0 equal to 4.0:1.0 equal to 3.5:1.0 3.5:1.0
----------------------- ------------------ ----------------- ------------------ ---------------
Commitment Fees 0% 0% 0% .0625% .125%
ABR Loans 0% .250% .500% .750% 1.000%
Eurodollar Loans 0% .250% .500% .750% 1.000%
Each change in the Pricing Adjustment resulting from a change in
the Debt/Adjusted EBITDA Ratio shall become effective with respect to all
outstanding Loans and Commitments on the Business Day after the date of receipt
by the Administrative Agent of the financial statements and certificates
required by Section 5.04(a) or (b) indicating such change until the date
immediately preceding the next date of delivery of such financial statements and
certificates indicating another such change. Notwithstanding the foregoing,
(i) the Pricing Adjustment shall be 0% for 12 months after the
Closing Date;
(ii) at any time during which the Borrower has failed to deliver
the financial statements and certificates required by Section 5.04(a)
or (b), the Debt/Adjusted EBITDA Ratio shall be deemed to be in
Category 1 for purposes of determining the Pricing Adjustment;
(iii) at any time after the occurrence and during the continuance
of an Event of Default relating to Section 7.01(b), (c), or (d) (but
only with respect to breaches of the covenants contained in Section
6.09 through Section 6.12), the Debt/Adjusted EBITDA Ratio shall be
deemed to be in Category 1 for purposes of determining the Pricing
Adjustment; and
(iv) the Pricing Adjustment shall be 0% during the period from
the Fifth Amendment Effective Date through June 30, 2002.
"Pricing Adjustment Certificate" means an pricing adjustment
certificate delivered by the Borrower to the Administrative Agent, in the form
of Exhibit O or such other form as shall be approved by the Administrative
Agent.
"Pro Forma Debt/Pro Forma EBITDA Ratio" means, as of any date
with respect to the Borrower and its consolidated Restricted Subsidiaries, (a)
the total amount of Debt of the Borrower and its consolidated Restricted
Subsidiaries as of such date (after giving effect to any Debt assumed or
Incurred in connection with a proposed acquisition), to (b) Pro Forma EBITDA of
the Borrower and its consolidated Restricted Subsidiaries for the four most
recently completed fiscal quarters for which financial statements are available.
"Pro Forma EBITDA" means, with respect to the Borrower and its
consolidated Restricted Subsidiaries for the most recently completed period of
four fiscal quarters for which financial statements are available, EBITDA on a
consolidated basis after giving effect to:
25
Exhibit 10.1
(a) a proposed Asset Acquisition or Stock Acquisition on a pro forma
basis (as if such acquisition has been made on the first day of such period),
and
(b) all Asset Acquisitions or Stock Acquisitions consummated during
such period on a pro forma basis (as if such acquisitions were made on the first
day of such period),
plus the pro forma cost savings for such period calculated, without duplication
(a) in accordance with Regulation S-X under the Securities Exchange Act of 1934,
as amended, and (b) good faith estimates by management and approved by the
Agents of the results of determined events which have been notified to the
Agents in writing in reasonable detail and do not exceed 20% of the reported
EBITDA of the acquired business for previous four quarters.
"Property" means, with respect to any person, any interest of such
person in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible, including Capital Stock in, and other securities of, any
other person.
"Public Equity Offering" means an underwritten public offering of
common stock of the Borrower pursuant to an effective registration statement
under the Securities Act.
"Recapitalization" has the meaning specified in Annex 3, and includes
any other transactions incidental thereto.
"Recapitalization Agreements" means the Acquisition Agreement, and any
other agreement, instrument or other document to be entered into or delivered
by, between or among the Borrower, the Sellers and any of their respective
Affiliates in connection with the Recapitalization, as each such agreement,
instrument or document may be amended, modified or supplemented from time to
time in accordance with the terms thereof and hereof.
"Redeemable Dividend" means, for any dividend with respect to
Redeemable Stock, the quotient of the dividend divided by the difference between
one and the maximum statutory federal income tax rate (expressed as a decimal
number between 1 and 0) then applicable to the issuer of such Redeemable Stock.
"Redeemable Stock" means, with respect to any person, any Capital
Stock that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable, in either case at the option of the
holder thereof,) or otherwise (a) matures or is mandatorily redeemable pursuant
to a sinking fund obligation or otherwise, (b) is or may become redeemable or
repurchaseable at the option of the holder thereof, in whole or in part, or (c)
is convertible or exchangeable, in either case at the option of the holder
thereof, for Debt or Disqualified Stock.
"Redemption Amount" has the meaning given such term in Section
4.02(t).
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) (collectively, "refinances," and "refinanced"
shall have a correlative meaning) any Indebtedness existing on the Closing Date
or Incurred in compliance with this Agreement ((including (a) Indebtedness of
the Borrower that refinances Indebtedness of any Restricted Subsidiary (to the
extent permitted in this Agreement), (b) Indebtedness of any Restricted
26
Exhibit 10.1
Subsidiary that refinances Indebtedness of another Restricted Subsidiary, and
(c) Indebtedness that refinances Refinancing Indebtedness); provided, however,
that (i) the Refinancing Indebtedness has a Stated Maturity no earlier than the
Stated Maturity of the Indebtedness being refinanced, (ii) the Refinancing
Indebtedness has an Average Life at the time such Refinancing Indebtedness is
Incurred that is equal to or greater than the Average Life of the Indebtedness
being refinanced and (iii) such Refinancing Indebtedness is Incurred in an
aggregate principal amount (or if issued with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate principal
amount (or if issued with original issue discount, the aggregate accreted value)
then outstanding of the Indebtedness being refinanced, plus fees, underwriting
discounts and other costs and expenses incurred in connection with such
Refinancing Indebtedness; provided further, however, that Refinancing
Indebtedness shall not include (x) Indebtedness of a Restricted Subsidiary that
is not a Subsidiary Guarantor that refinances Indebtedness of the Borrower or
(y) Indebtedness of the Borrower or a Restricted Subsidiary that refinances
Indebtedness of an Unrestricted Subsidiary.
"Register" has the meaning given such term in Section 9.04(d).
"Regulation G" means Regulation G of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation U" means Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation X" means Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulatory Shares" means, with respect to any person, shares of such
person required to be issued as qualifying shares to directors or persons
similarly situated or shares issued to persons other than the Borrower or a
wholly owned subsidiary of the Borrower in response to regulatory requirements
of foreign jurisdictions pursuant to a resolution of the Board of Directors of
such person, so long as such shares do not exceed 1% of the total outstanding
shares of Capital Stock of such person and any owners of such shares irrevocably
waive or agree to remit to the Borrower any dividends or distributions payable
in respect of such shares.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the environment.
"Remedial Action" means (a) "remedial action" as such term is defined
in CERCLA, 42 U.S.C. Section 9601(24), and (b) all other actions required by any
Governmental Authority or voluntarily undertaken to: (i) cleanup, remove, treat,
xxxxx or in any other way address any Hazardous Material in the environment;
(ii) prevent the Release or threat of Release, or minimize the further Release
of any Hazardous Material so it does not migrate or endanger or threaten to
endanger public health, welfare or the environment; or (iii) perform studies and
investigations in connection with, or as a precondition to, clause (i) or (ii).
"Repayment Date" means each date on which a principal installment on a
Borrowing is required to be paid in accordance with Section 2.11.
27
Exhibit 10.1
"Required Lenders" means, (i) prior to June 30, 2003, Lenders having
Loans (excluding Swingline Loans), L/C Exposure, Swingline Exposure and unused
Revolving Credit Commitments and Term Loan Commitments representing at least a
majority of the sum of all Loans outstanding (excluding Swingline Loans), L/C
Exposure, Swingline Exposure and unused Revolving Credit Commitments and Term
Loan Commitments at such time, (ii) on and after June 30, 2003, for all matters
other than those relating to any financial covenants, including without
limitation, Sections 6.08 and 6.10 and the related financial definitions,
Lenders having Loans (excluding Swingline Loans), L/C Exposure, Swingline
Exposure and unused Revolving Credit Commitments and Term Loan Commitments
representing at least 66-2/3% of the sum of all Loans outstanding (excluding
Swingline Loans), L/C Exposure, Swingline Exposure and unused Revolving Credit
Commitments and Term Loan Commitments at such time, and (iii) on and after June
30, 2003, for matters relating to any financial covenants, including without
limitation, Sections 6.08 and 6.10 and the related financial definitions,
including any amendment, modification or supplement thereof which occurs prior
to June 30, 2003 but which is effective for periods on and after June 30, 2003,
Lenders having Loans (excluding Swingline Loans), L/C Exposure, Swingline
Exposure and unused Revolving Credit Commitments and Term Loan Commitments
representing at least 71% of the sum of all Loans outstanding (excluding
Swingline Loans), L/C Exposure, Swingline Exposure and unused Revolving Credit
Commitments and Term Loan Commitments at such time; provided further that in no
event shall Xxxxxxx Xxxxxx or any of its officers, directors, employees or
Affiliates or anyone holding all or any portion of any Loan or Revolving Credit
Commitment on behalf of Xxxxxxx Xxxxxx or its Affiliates constitute a "Lender"
as used in this definition of Required Lenders.
"Responsible Officer" of any corporation means any executive officer
or Financial Officer of such corporation and any other officer or similar
official thereof responsible for the administration of the obligations of such
corporation in respect of this Agreement.
"Restricted Asset Disposition" means any sale, transfer, lease or
other disposition of any asset of the Borrower or any Subsidiary other than an
Unrestricted Asset Disposition.
"Restricted Payment" has the meaning assigned thereto in Section
6.05(a).
"Restricted Sale/Leaseback Transaction" means any Sale/Leaseback
Transaction other than an Unrestricted Sale/Leaseback Transaction.
"Restricted Subsidiary" means any Subsidiary of the Borrower other
than an Unrestricted Subsidiary.
"Revolving Credit Borrowing" means a Borrowing comprised of Revolving
Loans.
"Revolving Credit Commitment" means, with respect to each Lender, the
commitment of such Lender to make Revolving Loans hereunder as set forth on
Annex I, or in the Assignment and Acceptance pursuant to which such Lender
assumed its Revolving Credit Commitment, as applicable, as the same may be (a)
reduced from time to time pursuant to Section 2.09 and (b) reduced or increased
from time to time pursuant to assignments by or to such Lender pursuant to
Section 9.04.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the aggregate principal amount at such time of all outstanding Revolving
Loans of such Lender, plus
28
Exhibit 10.1
the aggregate amount at such time of such Lender's L/C Exposure, plus the
aggregate amount at such time of such Lender's Swingline Exposure.
"Revolving Credit Lender" means a Lender with a Revolving Credit
Commitment.
"Revolving Credit Maturity Date" means June 30, 2004.
"Revolving Credit Note" means a promissory note of the Borrower,
substantially in the form of Exhibit C, evidencing Revolving Loans.
"Revolving Loans" means the revolving loans made by the Lenders to the
Borrower pursuant to clause (b) of Section 2.01. Each Revolving Loan shall be a
Eurodollar Revolving Loan or an ABR Revolving Loan.
"SAP Computer Capital Expenditures" means Capital Expenditures for the
installation of the Borrower's SAP computer system, including hardware costs,
SAP licensing fees, implementation consulting, and internally capitalized labor,
in each case incurred on or before June 30, 2000.
"S&P" means Standard & Poor's Ratings Service.
"Sale/Leaseback Transactions" means any arrangement, directly or
indirectly, with any person whereby it shall sell or transfer any property, real
or personal, used or useful in its business, and thereafter rent or lease such
property or other property which it intends to use for substantially the same
purpose or purposes as the property being sold or transferred.
"Secured Parties" has the meaning assigned thereto in the Security
Agreement.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" means the Security Agreement, substantially in
the form of Exhibit I, between the Borrower, the Subsidiaries party thereto and
the Collateral Agent for the benefit of the Secured Parties.
"Security Documents" means the Mortgages, the Security Agreement, the
Pledge Agreement, the Nonrecourse Pledge Agreement, all deposit account control
agreements and each of the security agreements, mortgages and other instruments
and documents executed and delivered pursuant to any of the foregoing or
pursuant to Sections 5.11 or 5.14.
"Sellers" means Xxxxx Xxxxxx Xxxxxx and the other shareholders of the
Borrower immediately before the Recapitalization.
"Senior Notes" means the unsecured senior notes of Borrower due
December 31, 2004, in the form attached as Exhibit A to the Master Assignment
and Exchange Agreement, interest on which shall not be payable in cash but which
interest shall accrue until maturity and the principal on which shall have no
scheduled amortization prior to December 31, 2004, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms hereof. The Senior Notes shall include the Senior Notes issued on the
Effective Date and any Senior Notes issued thereafter permitted pursuant to
Section 6.01(k).
29
Exhibit 10.1
"Senior Subordinated Notes" means the Borrower's 9"% Senior
Subordinated Notes due 2008.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).
"Statutory Reserves" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority, domestic or foreign,
to which the Administrative Agent or any Lender (including any branch,
Affiliate, or other fronting office making or holding a Loan) is subject (a)
with respect to the Base CD Rate, for new negotiable nonpersonal time deposits
in dollars of over $100,000 with maturities approximately equal to three months,
and (b) with respect to the Adjusted Eurodollar Rate, for Eurocurrency
Liabilities (as defined in Regulation D of the Board). Such reserve percentages
shall include those imposed pursuant to such Regulation D. Eurodollar Loans
shall be deemed to constitute Eurocurrency Liabilities and to be subject to such
reserve requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender under such
Regulation D. Statutory Reserves shall be adjusted automatically on and as of
the effective date of any change in any reserve percentage.
"Stock Acquisition" means an acquisition of Capital Stock of any
person other than in the ordinary course of the Borrower's business.
"Subordinated Obligation" means any Indebtedness of the Borrower or
any Subsidiary (whether outstanding on the Closing Date or thereafter Incurred)
which is subordinate or junior in right of payment to the Notes or the
applicable Guarantee pursuant to a written agreement to that effect, including,
but not limited to the FS Convertible Senior Subordinated Debt.
"subsidiary" means, with respect to any person (herein referred to as
the "parent"), any corporation, partnership, association or other business
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or more
than 50% of the general partnership interests are, at the time any determination
is being made, owned, controlled or held, or (b) that is, at the time any
determination is made, otherwise Controlled, by Holding or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"Subsidiary" means any subsidiary of the Borrower.
"Subsidiary Guarantee Agreement" means the Subsidiary Guarantee
Agreement, substantially in the form of Exhibit M, made by the Subsidiary
Guarantors in favor of the Collateral Agent for the benefit of the Secured
Parties.
30
Exhibit 10.1
"Subsidiary Guarantor" means each Subsidiary listed on Schedule
1.01(c), and each other Subsidiary that is or becomes a party to a Subsidiary
Guarantee Agreement.
"Swedish Acquisitionco" is defined in Annex 4.
"Swingline Commitment" means the commitment of the Swingline
Lender to make loans pursuant to Section 2.22, as the same may be reduced from
time to time pursuant to Section 2.09 .
"Swingline Exposure" means at any time the aggregate principal
amount at such time of all outstanding Swingline Loans. The Swingline Exposure
of any Revolving Credit Lender at any time shall equal its Applicable Percentage
of the aggregate Swingline Exposure at such time.
"Swingline Lender" has the meaning assigned thereto in the
Preamble hereto.
"Swingline Loan" means any loan made by the Swingline Lender
pursuant to Section 2.22.
"Swingline Note" means a promissory note evidencing Swingline
Loans, executed and delivered as provided in Section 2.22 in substantially the
form of Exhibit D.
"Syndication Agent" has the meaning assigned thereto in the
Preamble.
"Target" means a person whose Capital Stock is the subject of a
proposed Permitted Acquisition.
"Taxes" has the meaning assigned thereto in Section 2.20(a).
"Term Borrowing" means a Borrowing comprised of Term Loans.
"Term Loan Commitment" means, with respect to each Lender, the
commitment of such Lender to make Term Loans hereunder as set forth on Annex 1,
or in the Assignment and Acceptance pursuant to which such Lender assumed its
Term Loan Commitment, as applicable, as the same may be (a) reduced from time to
time pursuant to Section 2.09 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04.
"Term Loans" means the term loans made by the Lenders to the
Borrower pursuant to Section 2.01. Each Term Loan shall be a Eurodollar Term
Loan or an ABR Term Loan.
"Term Note" means a promissory note of the Borrower,
substantially in the form of Exhibit B, evidencing Term Loans.
"Three-Month Secondary CD Rate" means, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.15(519)
31
Exhibit 10.1
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 a.m., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it.
"Total Revolving Credit Commitment" means, at any time, the
aggregate amount of the Revolving Credit Commitments, as in effect at such time.
"Transaction Costs" means commitment fees, financing fees,
advisory fees, underwriting fees and discounts, and other out-of-pocket fees and
expenses relating to the Recapitalization, excluding any expenses of the Sellers
which are deducted from the Redemption Amount.
"Transactions" has the meaning assigned thereto in Section 3.02.
"Transferee" has the meaning assigned thereto in Section 2.20(a).
"Type", when used in respect of any Loan or Borrowing, shall
refer to the Rate by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, the term "Rate"
shall include the Adjusted Eurodollar Rate and the Alternate Base Rate.
"Unrestricted Asset Disposition" means, on a consolidated basis
with respect to the Borrower or any wholly owned Restricted Subsidiary, any
sale, transfer, lease or other disposition of any inventory, cash, Permitted
Investment, or obsolete or unusable Property of the Borrower or any Subsidiary
in the ordinary course of business and not otherwise in violation of this
Agreement.
"Unrestricted Sale/Leaseback Transaction" mean any Sale/Leaseback
Transaction which does not involve a sale or transfer of property which is owned
by the Borrower or its Restricted Subsidiaries on the Closing Date (or any
replacements thereof).
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Borrower that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors of the Borrower in the manner provided
below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of
Directors of the Borrower may designate any Subsidiary of the Borrower
(including any newly acquired or newly formed Subsidiary of the Borrower) to be
an Unrestricted Subsidiary; provided, however, that at the time of such
designation and in the case of clauses (A) and (B), at all times thereafter
(A) neither such Subsidiary nor any of its Subsidiaries
owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, the Borrower or any Restricted
Subsidiary of the Borrower; and
(B) except to the extent permitted under Section
6.03(c)(iii)(B), neither Holding, the Borrower nor any Restricted
Subsidiary has Guaranteed any Indebtedness or other obligation of
such Subsidiary to be so designated, and no
32
Exhibit 10.1
Indebtedness of such Subsidiary to be designated shall constitute
Indebtedness of Holding, the Borrower or any Restricted Subsidiary;
and
(C) except in the case of Swedish Acquisitionco, US Holdco or
Euro Holdco and any of their Subsidiaries, the Subsidiary to be so
designated has total consolidated assets of $1,000 or less.
"US Holdco" is defined in Annex 4.
"Voting Stock" of a corporation means all classes of Capital Stock of
such corporation then outstanding and normally entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof.
"wholly owned Subsidiary" of any person means a Restricted Subsidiary
of which securities (except for Regulatory Shares) or other ownership interests
representing 100% of the equity or 100% of the ordinary voting power or 100% of
the general partnership interests are, at the time any determination is being
made, owned, controlled or held by the Borrower or one or more wholly owned
Subsidiaries of the Borrower or by the Borrower and one or more wholly owned
Subsidiaries of the Borrower.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
"Work" has the meaning assigned thereto in Section 5.12(e).
"Working Capital Loans" has the meaning set forth in Section
3.13(e)(2).
SECTION 1.02. Terms Generally . The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Articles, Sections, Annexes, Exhibits and Schedules
shall be deemed references to Articles and Sections of, and Annexes, Exhibits
and Schedules to, this Agreement unless the context shall otherwise require.
Except as otherwise expressly provided herein, (a) any reference in this
Agreement to any Credit Document means such document as amended, restated,
supplemented or otherwise modified from time to time and (b) all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided, however, that for purposes of determining
compliance with the covenants contained in Article VI, all accounting terms
herein shall be interpreted and all accounting determinations hereunder shall be
made in accordance with GAAP as in effect on the date of this Agreement and
applied on a basis consistent with the application used in the financial
statements referred to in Section 3.05(a).
33
Exhibit 10.1
ARTICLE II
The Credits
SECTION 2.01. Commitments. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, (a) to make a single Term Loan to the
Borrower on the Closing Date in a principal amount not to exceed its Term Loan
Commitment, and (b) to make Revolving Loans to the Borrower, at any time and
from time to time on or after the date hereof, and until the earlier of the
Revolving Credit Maturity Date and the termination of the Revolving Credit
Commitment of such Lender in accordance with the terms hereof, in an aggregate
principal amount at any time outstanding that will not result in (i) such
Lender's Revolving Credit Exposure exceeding (ii) such Lender's Revolving Credit
Commitment. Within the limits set forth in clause (b) of the preceding sentence
and subject to the terms, conditions and limitations set forth herein, the
Borrower may borrow, pay or prepay and reborrow Revolving Loans; provided
however that on and after the Fifth Amendment Effective Date, Borrower may not
borrow or reborrow Acquisition Loans (as defined in Section 3.13(e)(1)).
SECTION 2.02. Loans.
(a) Each Loan (other than Swingline Loans) shall be made as part of a
Borrowing consisting of Loans made by the Lenders ratably in accordance with
their applicable Revolving Credit Commitments; provided, however, that the
failure of any Lender to make any Loan shall not in itself relieve any other
Lender of its obligation to lend hereunder (it being understood, however, that
no Lender shall be responsible for the failure of any other Lender to make any
Loan required to be made by such other Lender). Except for Loans deemed made
pursuant to Section 2.02(e) or pursuant to Section 2.22(e)), the Loans
comprising any Borrowing shall be in an aggregate principal amount that is (i)
in the case of Eurodollar Loans, an integral multiple of $1,000,000 and not less
than $3,500,000, (ii) in the case of ABR Loans, an integral multiple of $100,000
and not less than $1,000,000 or (ii) equal to the remaining available balance of
the applicable Commitments.
(b) Subject to Sections 2.08 and 2.15, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
pursuant to Section 2.03. Each Lender may at its option make any Eurodollar Loan
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan; provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with the terms of
this Agreement and the applicable Note. Borrowings of more than one Type may be
outstanding at the same time; provided, however, that the Borrower shall not be
entitled to request any Borrowing that, if made, would result in more than five
Eurodollar Borrowings outstanding hereunder at any time. For purposes of the
foregoing, Borrowings having different Interest Periods, regardless of whether
they commence on the same date, shall be considered separate Borrowings.
(c) Except with respect to Loans made pursuant to Section 2.02(e),
each Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds to such account in New
York City as the Administrative Agent may designate not later than 11:00 a.m.,
New York City time, and the Administrative Agent shall by
34
Exhibit 10.1
12:00 (noon), New York City time, credit the amounts so received to an account
in the name of the Borrower and designated by the Borrower in the applicable
Borrowing Request or, if a Borrowing shall not occur on such date because any
condition precedent herein specified shall not have been met, return the amounts
so received to the respective Lenders.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's portion of such Borrowing,
the Administrative Agent may assume that such Lender has made such portion
available to the Administrative Agent on the date of such Borrowing in
accordance with clause (c) and the Administrative Agent may, in reliance upon
such assumption, make available to the Borrower on such date a corresponding
amount. If the Administrative Agent shall have so made funds available then, to
the extent that such Lender shall not have made such portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower until the date such amount is repaid to the Administrative Agent
at (i) in the case of the Borrower, the interest rate applicable at the time to
the Loans comprising such Borrowing and (ii) in the case of such Lender, for the
first such day, the Federal Funds Effective Rate, and for each day thereafter,
the Alternate Base Rate. If such Lender shall repay to the Administrative Agent
such corresponding amount, such amount shall constitute such Lender's Loan as
part of such Borrowing for purposes of this Agreement.
(e) If the Issuing Bank shall not have received from the Borrower the
payment required to be made by Section 2.23(e) within the time specified in such
Section, the Issuing Bank will promptly notify the Administrative Agent of the
L/C Disbursement and the Administrative Agent will promptly notify each
Revolving Credit Lender of such L/C Disbursement and its Applicable Percentage
thereof. Each Revolving Credit Lender shall pay by wire transfer of immediately
available funds to the Administrative Agent not later than 2:00 p.m., New York
City time, on such date (or, if such Revolving Credit Lender shall have received
such notice later than 12:00 (noon), New York City time, on any day, not later
than 10:00 a.m., New York City time, on the immediately following Business Day),
an amount equal to such Lender's Applicable Percentage of such L/C Disbursement
(it being understood that such amount shall be deemed to constitute an ABR
Revolving Loan of such Lender and such payment shall be deemed to have reduced
the L/C Exposure), and the Administrative Agent will promptly pay to the Issuing
Bank amounts so received by it from the Revolving Credit Lenders. The
Administrative Agent will promptly pay to the Issuing Bank any amounts received
by it from the Borrower pursuant to Section 2.23(e) prior to the time that any
Revolving Credit Lender makes any payment pursuant to this clause; any such
amounts received by the Administrative Agent thereafter will be promptly
remitted by the Administrative Agent to the Revolving Credit Lenders that shall
have made such payments and to the Issuing Bank, as their interests may appear.
If any Revolving Credit Lender shall not have made its Applicable Percentage of
such L/C Disbursement available to the Administrative Agent as provided above,
such Lender and the Borrower severally agree to pay interest on such amount, for
each day from and including the date such amount is required to be paid in
accordance with this clause to but excluding the date such amount is paid, to
the Administrative Agent for the account of the Issuing Bank at (i) in the case
of the Borrower, a rate per annum equal to the interest rate applicable to
Revolving Loans pursuant to Section 2.06(a), and (ii) in the case of such
Lender, for the first such day, the Federal Funds Effective Rate, and for each
day thereafter, the Alternate Base Rate.
35
Exhibit 10.1
SECTION 2.03. Borrowing Procedure. In order to request a Borrowing
(other than a Swingline Loan or a deemed Borrowing pursuant to Section 2.02(e),
as to which this Section shall not apply), the Borrower shall hand deliver or
telecopy to the Administrative Agent a duly completed Borrowing Request (a) in
the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before a proposed Borrowing, and (b) in the case of an
ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day
before a proposed Borrowing. Each Borrowing Request shall be irrevocable, shall
be signed by or on behalf of the Borrower and shall specify the following
information: (i) whether the Borrowing then being requested is to be a Term
Borrowing or a Revolving Credit Borrowing, and whether such Borrowing is to be a
Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which
shall be a Business Day), (iii) the number and location of the account to which
funds are to be disbursed (which shall be an account that complies with the
requirements of Section 2.02(c)); (iv) the amount of such Borrowing; and (v) if
such Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect
thereto; provided, however, that, notwithstanding any contrary specification in
any Borrowing Request, each requested Borrowing shall comply with the
requirements set forth in Section 2.02. The initial Borrowing shall be an ABR
Borrowing. If no election as to the Type of Borrowing is specified in any such
notice, then the requested Borrowing shall be an ABR Borrowing. If no Interest
Period with respect to any Eurodollar Borrowing is specified in any such notice,
then the Borrower shall be deemed to have selected an Interest Period of one
month's duration. The Administrative Agent shall promptly advise the applicable
Lenders of any notice given pursuant to this Section, and of each Lender's
portion of the requested Borrowing.
SECTION 2.04. Notes and Records.
(a) The Revolving Loans, Term Loans and Swingline Loans made by each
Lender shall be evidenced by a Revolving Credit Note, Term Note and Swingline
Note, respectively, duly executed on behalf of the Borrower, dated the Closing
Date, payable to the order of such Lender in a principal amount equal to such
Lender's Revolving Credit Commitment, in the case of its Revolving Credit Note,
such Lender's Term Commitment, in the case of its Term Note or such Lender's
Swingline Commitment, in the case of its Swingline Note. The outstanding
principal balance of each Loan, as evidenced by such a Note, shall be payable
(i) in the case of a Swingline Loan, on the last day of the Interest Period
applicable to such Loan and on the Revolving Credit Maturity Date, (ii) in the
case of a Revolving Loan, on the Revolving Credit Maturity Date and (iii) in the
case of a Term Loan, as provided in Section 2.11.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid such Lender from time to time
under this Agreement. Each Lender shall, and is hereby authorized by the
Borrower to, endorse on the schedule attached to each Note delivered to such
Lender (or on a continuation of such schedule attached to such Note and made a
part thereof), or otherwise to record in such Lender's internal records, an
appropriate notation evidencing the date and amount of each Loan from such
Lender, each payment and prepayment of principal of any such Loan, each payment
of interest on any such Loan and the other information provided for on such
schedule; provided, however, that the failure of any Lender to make such a
notation 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
of this Agreement and the applicable Note.
36
Exhibit 10.1
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder from the Borrower or any Guarantor and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to clauses (b)
and (c) shall be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
SECTION 2.05. Fees.
(a) The Borrower agrees to pay to each Lender, through the
Administrative Agent, on March 31, June 30, September 30 and December 31
(beginning on June 30, 1998) and on each date on which any Commitment of such
Lender shall expire or be terminated as provided herein, a commitment fee (a
"Commitment Fee") of 0.50% per annum less the applicable Pricing Adjustment on
the average daily excess of the aggregate amount of the Revolving Credit
Commitments over the aggregate amount of the Revolving Credit Exposures during
the preceding quarter (or other period commencing with the date of acceptance by
the Borrower of the Commitment of such Lender or ending with the Revolving
Credit Maturity Date or the date on which the Commitments of such Lender shall
expire or be terminated). All Commitment Fees shall be computed on the basis of
the actual number of days elapsed in a year of 360 days. The Commitment Fee due
to each Lender shall begin to accrue on the date of execution of this Agreement
and shall cease to accrue on the date on which the Commitment of such Lender
shall expire or be terminated as provided herein. For purposes of calculating
Commitment Fees only, no portion of the Revolving Credit Commitments shall be
deemed utilized under Section 2.17 as a result of outstanding Swingline Loans.
(b) The Borrower agrees to pay to the Administrative Agent, for its own
account, the administrative fees set forth in the Fee Letter at the times and in
the amounts specified therein (the "Administrative Agent Fees").
(c) The Borrower agrees to pay to the Administrative Agent, for payment
to the other Lenders (to the extent applicable), on the Closing Date, the other
fees specified in the Fee Letter, and the Administrative Agent shall pay to each
Lender on the Closing Date that portion of such fees that shall be owing to such
Lender.
(d) The Borrower agrees to pay (i) to each Revolving Credit Lender,
through the Administrative Agent, on March 31, June 30, September 30 and
December 31 of each year and on the date on which the Revolving Credit
Commitment of such Lender shall be terminated as provided herein, a fee (an "L/C
Participation Fee") calculated on such Lender's Applicable Percentage of the
average daily aggregate L/C Exposure (excluding the portion thereof attributable
to unreimbursed L/C Disbursements) during the preceding quarter (or shorter
period commencing with the Closing Date or ending with the Revolving Credit
Maturity Date or the date on which all Letters of Credit have been cancelled or
have expired and the Revolving Credit Commitments of
37
Exhibit 10.1
all Lenders shall have been terminated) at a rate equal to the applicable margin
from time to time used to determine the interest rate on Revolving Credit
Borrowings comprised of Eurodollar Loans pursuant to Section 2.06, and (ii) to
the Issuing Bank with respect to each Letter of Credit an administrative fee
payable to the Issuing Bank equal to the greater of (a) for the period from and
after the date of issuance thereof (or, with respect to Existing Letters of
Credit, for the period from and after the Closing Date), 1/4 of 1% per annum of
the maximum amount available from time to time to be drawn under such Letter of
Credit, in each case calculated in arrears on and through the last day of each
Fiscal Quarter and on the basis of a 360-day year and the actual number of days
elapsed and (b) $500, and payable on the Business Day immediately succeeding
such date of calculation in immediately available funds, and (iii) the standard
issuance, drawing and amendment fees specified from time to time by the Issuing
Bank (the "Issuing Bank Fees"). All L/C Participation Fees and Issuing Bank Fees
shall be computed on the basis of the actual number of days elapsed in a year of
360 days.
(e) The Borrower agrees to pay each Lender, through the Administrative
Agent, on July 1, 2002, a fee equal to 0.075% of the sum of such Lender's
Revolving Credit Commitment and outstanding Term Loans as of such date.
(f) If the compliance certificate filed by the Borrower with respect to
the fiscal period ended June 30, 2002 sets forth a Debt/Adjusted EBITDA Ratio in
excess of 4.90:1.00, or if such compliance certificate is not filed by the
deadline set forth in Section 5.04(b), the Borrower agrees to immediately pay
each Lender, through the Administrative Agent, a fee equal to 0.025% of the sum
of such Lender's Revolving Credit Commitment and outstanding Term Loans as of
such deadline.
All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders, except that the Issuing Bank Fees shall be paid directly to
the Issuing Bank. Once paid, none of the Fees shall be refundable under any
circumstances.
SECTION 2.06. Interest on Loans.
(a) Subject to the provisions of Section 2.07, the Loans comprising
each ABR Borrowing, including each Swingline Loan, shall bear interest (computed
on the basis of the actual number of days elapsed over a year of 365 or 366
days, as the case may be, when the Alternate Base Rate is determined by
reference to the Prime Rate and over a year of 360 days at all other times) at a
rate per annum equal to the Alternate Base Rate plus
(i) from the Fifth Amendment Effective Date through June 30, 2002,
3.00% less the applicable Pricing Adjustment in the case of Term Loans and
Working Capital Loans and 3.25% less the applicable Pricing Adjustment in
the case of Acquisition Loans;
(ii) from July 1, 2002 through March 31, 2003, 3.50% less the
applicable Pricing Adjustment in the case of Term Loans and Working Capital
Loans and 3.75% less the applicable Pricing Adjustment in the case of
Acquisition Loans; and
(iii) from April 1, 2003, 4.00% less the applicable Pricing Adjustment
in the case of Term Loans and Working Capital Loans and 4.25% less the
Applicable Pricing Adjustment in the case of Acquisition Loans.
38
Exhibit 10.1
(b) Subject to the provisions of Section 2.07, the Loans comprising
each Eurodollar Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 360 days) at a rate per annum equal
to the Adjusted Eurodollar Rate for the Interest Period in effect for such
Borrowing plus
(i) from the Fifth Amendment Effective Date through June 30, 2002,
4.00% less the applicable Pricing Adjustment in the case of Term Loans and
Working Capital Loans and 4.25% less the applicable Pricing Adjustment in
the case of Acquisition Loans;
(ii) from July 1, 2002 through March 31, 2003, 4.50% less the
applicable Pricing Adjustment in the case of Term Loans and Working Capital
Loans and 4.75% less the applicable Pricing Adjustment in the case of
Acquisition Loans; and
(iii) from April 1, 2003, 5.00% less the applicable Pricing Adjustment
in the case of Term Loans and Working Capital Loans and 5.25% less the
Applicable Pricing Adjustment in the case of Acquisition Loans.
(c) Interest shall accrue from and including the first day of an
Interest Period to but excluding the last day of such Interest Period. Interest
on each Loan shall be payable on the Interest Payment Dates applicable to such
Loan except as otherwise provided in this Agreement. The applicable Alternate
Base Rate or Adjusted Eurodollar Rate for each Interest Period or day within an
Interest Period, as the case may be, shall be determined by the Administrative
Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.07. Default Interest. Upon the occurrence and during the
continuation of any Event of Default, the Borrower shall on demand from time to
time pay interest, to the extent permitted by law, on the outstanding principal
amount of all Loans, any interest payments thereon not paid when due and any
fees and other amounts then due and payable hereunder on such Loans at the rate
otherwise applicable to such Loan pursuant to Section 2.06 without making the
applicable Pricing Adjustment plus 2.00% per annum.
SECTION 2.08. Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing any Lender shall have determined that
dollar deposits in the principal amounts of the Loans comprising such Borrowing
are not generally available to it in the Eurodollar interbank market, or that
the rates at which such dollar deposits are being offered will not adequately
and fairly reflect the cost to such Lender of making or maintaining its
Eurodollar Loan during such Interest Period, or that the Administrative Agent
shall have determined that reasonable means do not exist for ascertaining the
Adjusted Eurodollar Rate as soon as practicable thereafter, the affected Lender
shall give written or telecopy notice thereof to the Administrative Agent,
and/or the Administrative Agent shall, give written or telecopy notice thereof
to the Borrower and the Lenders. In the event of any such determination, until
the affected Lender or the Administrative Agent, as the case may be, shall have
given notice that the circumstances giving rise to such notice no longer exist,
any request by the Borrower for a Eurodollar Borrowing pursuant to Section 2.03
or 2.10, from the affected Lender or the Lenders, as the case may be, shall be
deemed to be a request for an ABR Borrowing. Each determination by such Lender
or the Administrative Agent hereunder shall be conclusive absent manifest error.
39
Exhibit 10.1
SECTION 2.09. Termination and Reduction of Commitments.
(a) The Term Loan Commitments hereunder shall terminate on the
earliest of (i) the date on which the Borrower informs the Lenders that it has
decided not to proceed with the Recapitalization, (ii) the date on which the
Acquisition Agreement is terminated in accordance with its terms or (iii) 5:00
p.m., New York City Time, April 30, 1998, if the initial Credit Event is not
made on or before such date. The Revolving Credit Commitments, the Swingline
Commitment and the L/C Commitment shall automatically terminate on the earliest
of (i) the Revolving Credit Maturity Date, (ii) the date on which the Borrower
informs the Lenders that it has decided not to proceed with the
Recapitalization, (iii) the date on which the Acquisition Agreement is
terminated in accordance with its terms or (iv) 5:00 p.m., New York City Time,
April 16, 1998, if the initial Credit Event shall not have occurred by such
time.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Term Loan Commitments or the Revolving Credit Commitments; provided,
however, that (i) each partial reduction of the Term Loan Commitments or the
Revolving Credit Commitments shall be in (1) an integral multiple of $1,000,000
and in a minimum amount of $1,000,000 or (2) in the full remaining amount of the
Term Loan Commitments or the Revolving Credit Commitments, as the case may be,
and (ii) the Total Revolving Credit Commitment shall not be reduced to an amount
that is less than the sum of the Aggregate Revolving Credit Exposure at the
time. In addition, if no Term Loans or Acquisition Loans are outstanding, the
Revolving Credit Commitments shall automatically be reduced by the amount of any
mandatory prepayment that would otherwise have been applied to the prepayment of
Term Loans or Acquisition Loans pursuant to Section 2.13(g). The Borrower in
making any voluntary reduction of the Revolving Credit Commitments may designate
whether such reduction applies to the Revolving Credit Commitments available
with respect to Acquisition Loans pursuant to Section 3.13(e)(1) hereof, or to
the Revolving Credit Commitments available with respect to Working Capital Loans
pursuant to Section 3.13(e)(2) hereof.
(c) Each reduction in the Term Loan Commitments or the Revolving
Credit Commitments hereunder shall be made ratably among the Lenders in
accordance with their respective applicable Commitments. The Borrower shall pay
to the Administrative Agent for the account of the applicable Lenders, on the
date of each termination or reduction, the Commitment Fees on the amount of the
Commitments so terminated or reduced accrued to but excluding the date of such
termination or reduction.
SECTION 2.10. Conversion and Continuation of Borrowings. The Borrower
shall have the right at any time by delivery of a Continuation/Conversion
Request (or by telephonic notice promptly confirmed by delivery of a
Continuation/Conversion Request) to the Administrative Agent (a) not later than
11:00 a.m., New York City time, one Business Day prior to conversion, to convert
any Eurodollar Borrowing into an ABR Borrowing, (b) upon the occurrence of the
Effective Date, not later than 11:00 a.m., New York City time, three Business
Days prior to conversion or continuation, to convert any ABR Borrowing into a
Eurodollar Borrowing or to continue any Eurodollar Borrowing as a Eurodollar
Borrowing for an additional Interest Period, and (c) upon the occurrence of the
Effective Date, not later than 11:00 a.m., New York City time, three Business
Days prior to conversion, to convert the Interest Period with
40
Exhibit 10.1
respect to any Eurodollar Borrowing to another permissible Interest Period,
subject in each case to the following:
(i) each conversion or continuation shall be made pro rata among the
Lenders in accordance with the respective principal amounts of the Loans
comprising the converted or continued Borrowing;
(ii) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, then each resulting Borrowing
shall satisfy the limitations specified in Sections 2.02(a) and 2.02(b)
regarding the principal amount and maximum number of Borrowings of the
relevant Type;
(iii) each conversion shall be effected by each Lender and the
Administrative Agent by recording for the account of such Lender the new
Loan of such Lender resulting from such conversion and reducing the Loan
(or portion thereof) of such Lender being converted by an equivalent
principal amount; accrued interest on any Eurodollar Loan (or portion
thereof) being converted shall be paid by the Borrower at the time of
conversion;
(iv) if any Eurodollar Borrowing is converted at a time other than
the end of the Interest Period applicable thereto, the Borrower shall pay,
upon demand, any amounts due to the Lenders pursuant to Section 2.16;
(v) any portion of a Borrowing maturing or required to be repaid in
less than one month may not be converted into or continued as a Eurodollar
Borrowing;
(vi) any portion of a Eurodollar Borrowing that cannot be converted
into or continued as a Eurodollar Borrowing by reason of the immediately
preceding clause shall be automatically converted at the end of the
Interest Period in effect for such Borrowing into an ABR Borrowing;
(vii) no Interest Period may be selected for any Eurodollar Borrowing
that would end later than a Repayment Date applicable thereto occurring on
or after the first day of such Interest Period if, after giving effect to
such selection, the aggregate outstanding amount of (A) applicable
Eurodollar Borrowings with Interest Periods ending on or prior to such
Repayment Date and (B) the applicable ABR Borrowings would not be at least
equal to the principal amount of Borrowings to be paid on such Repayment
Date;
(viii) no Interest Period applicable to a Revolving Loan may end later
than the Revolving Credit Maturity Date, and no Interest Period applicable
to a Term Loan may end later than the Loan Maturity Date; and
(ix) after the occurrence and during the continuance of a Default or
Event of Default, no outstanding Loan may be converted into, or continued
as, a Eurodollar Loan.
Each notice pursuant to this Section shall be irrevocable and shall
refer to this Agreement and specify (A) the identity and amount of the Borrowing
that the Borrower requests be converted or continued, (B) whether such Borrowing
is to be converted to or continued as a Eurodollar Borrowing or an ABR
Borrowing, (C) if such notice requests a conversion, the date of such conversion
(which shall be a Business Day) and (D) if such Borrowing is to be converted to
41
Exhibit 10.1
or continued as a Eurodollar Borrowing, the Interest Period with respect
thereto. If no Interest Period is specified in any such notice with respect to
any conversion to or continuation as a Eurodollar Borrowing, the Borrower shall
be deemed to have selected an Interest Period of one month's duration. The
Administrative Agent shall advise the Lenders of any notice given pursuant to
this Section and of each Lender's portion of any converted or continued
Borrowing. If the Borrower shall not have given notice in accordance with this
Section to continue any Borrowing into a subsequent Interest Period (and shall
not otherwise have given notice in accordance with this Section to convert such
Borrowing), such Borrowing shall, at the end of the Interest Period applicable
thereto (unless repaid pursuant to the terms hereof), automatically be continued
into a new Interest Period as an ABR Borrowing.
SECTION 2.11. Repayment of Term Borrowings.
(a) The principal of the Term Borrowings shall be payable in quarterly
installments on the following Repayment Dates in the following amounts:
----------------------------------------------------------------------
Date Amount of Repayment
-------------------------------------------
2002 2003 2004
----------------------------------------------------------------------
March 31 $1,250,000
----------------------------------------------------------------------
June 30 $1,250,000 $3,000,000
----------------------------------------------------------------------
September 30 $1,250,000 $2,000,000
----------------------------------------------------------------------
December 31 $1,250,000
----------------------------------------------------------------------
(b) Repayment of Acquisition Borrowings. The principal of the
Acquisition Loans shall be payable in quarterly installments on the following
Repayment Dates in the following amounts:
----------------------------------------------------------------------
Date Amount of Repayment
----------------------------------------------------------------------
2003 2004
----------------------------------------------------------------------
March 31 $ 2,000,000
----------------------------------------------------------------------
June 30 $35,000,000
----------------------------------------------------------------------
September 30 $1,000,000
----------------------------------------------------------------------
December 31 $2,000,000
----------------------------------------------------------------------
(c) Accrued Interest. Each payment of Borrowings pursuant to this
Section shall be accompanied by accrued interest on the principal amount paid to
but excluding the date of payment.
(d) Certain Loan Purchases. In the event that Xxxxxxx Xxxxxx or any
affiliate of Xxxxxxx Xxxxxx or any shareholder of Holdings or Borrower desires
to purchase additional Loans in order to effect all or any portion of the next
scheduled quarterly amortization payment on the Loans, each Lender hereby agrees
to sell such Loans to Xxxxxxx Xxxxxx, any such Affiliate or shareholder on terms
and conditions which are substantially the same as those set forth in the Master
Assignment and Exchange Agreement including without limitation that such loans
are
42
Exhibit 10.1
purchased at par on a pro rata basis from all Lenders, all accrued interest
on the purchased Loans is paid through the date of purchase, such purchased
Loans are immediately exchanged for additional Senior Notes and pledged to
Collateral Agent pursuant to the Nonrecourse Pledge Agreement and upon such
exchange shall no longer constitute Obligations or Indebtedness outstanding
under this Agreement or the other Credit Documents.
SECTION 2.12. Prepayment.
(a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing, in whole or in part, upon at least three Business
Days' prior written or telecopy notice (or telephone notice promptly confirmed
by written or telecopy notice) to the Administrative Agent before 11:00 a.m.,
New York City time; provided, however, that each partial prepayment shall be in
an amount that is an integral multiple of $1,000,000 and not less than
$1,000,000.
(b) Optional prepayments of Term Loans or Acquisition Loans shall be
applied (i) first, to scheduled amortization payments due within 12 calendar
months thereafter, and (ii) second, pro rata against the remaining scheduled
installments of principal due in respect of the Term Loans or Acquisition Loans.
(c) Each notice of prepayment shall specify the prepayment date and
the principal amount of each Borrowing (or portion thereof) to be prepaid, shall
be irrevocable and shall commit the Borrower to prepay such Borrowing by the
amount stated therein on the date stated therein. All prepayments under this
Section shall be subject to Section 2.16 but otherwise without premium or
penalty. All prepayments under this Section shall be accompanied by accrued
interest on the principal amount being prepaid to the date of payment.
SECTION 2.13. Mandatory Prepayments.
(a) In the event of any termination of all the Revolving Credit
Commitments, the Borrower shall repay or prepay all its outstanding Revolving
Credit Borrowings and all outstanding Swingline Loans on the date of such
termination. In the event of any partial reduction of the Revolving Credit
Commitments, then (i) at or prior to the effective date of such reduction, the
Administrative Agent shall notify the Borrower and the Revolving Credit Lenders
of the Aggregate Revolving Credit Exposure after giving effect thereto and (ii)
if the Aggregate Revolving Credit Exposure would exceed the Total Revolving
Credit Commitment after giving effect to such reduction or termination, then the
Borrower shall, on the date of such reduction or termination, repay or prepay
Revolving Credit Borrowings or Swingline Loans (or a combination thereof) in an
amount sufficient to eliminate such excess. In the event that, as of any date of
determination, the sum of (x) cash on hand plus (y) Permitted Investments
exceeds $5,000,000 for a period of greater than 30 consecutive days, in each
case as determined for Borrower and its Restricted Subsidiaries on a
consolidated basis (the amount of such excess being hereinafter referred to as
the "Excess Liquidity"), Borrower shall repay or prepay its Swingline Loans and
its Revolving Credit Borrowings by an amount equal to such Excess Liquidity,
such Excess Liquidity being applied to repay or prepay first Swingline Loans to
the full extent thereof, second Working Capital Loans and third Acquisition
Loans, in the case of Swingline Loans and Working Capital Loans without any
related reduction in the Revolving Credit Commitment.
43
Exhibit 10.1
(b) With respect to (I) any Restricted Asset Disposition other than
the sale of the Excess Real Estate, not later than the earliest of (i) the third
Business Day following the completion of any Restricted Asset Disposition if the
Borrower does not intend to reinvest the Net Cash Proceeds thereof or
Administrative Agent has not approved the reinvestment of such Net Cash Proceeds
prior to receipt by Borrower or any Restricted Subsidiary of such proceeds, as
and under the circumstances set forth in the definition of Net Cash Proceeds,
(ii) promptly after the date on which the Borrower determines not to reinvest
such Net Cash Proceeds or Administrative Agent disapproves such reinvestment as
set forth in the definition of Net Cash Proceeds, and (iii) the first
anniversary of the date thereof, the Borrower shall apply 100% of the Net Cash
Proceeds, if any, received with respect thereto to prepay outstanding Term Loans
and/or Acquisition Loans and/or reduce the Revolving Credit Commitment in
accordance with Section 2.13(g); and (II) any sale of the Excess Real Estate,
not later than the first Business Day thereafter Borrower shall apply (i) the
first $3,500,000 in Net Cash Proceeds from the sale of such Excess Real Estate
to reduce outstandings under the Revolving Credit Facility but without any
Revolving Credit Commitment reduction and (ii) Net Cash Proceeds in excess of
$3,500,000 to prepay Term Loans and/or Acquisition Loans and/or reduce the
Revolving Credit Commitment in accordance with Section 2.13(g).
(c) In the event and on each occasion that
(i) an Equity Issuance occurs as part of an initial public offering
of the Capital Stock of the Borrower or Holding, the Borrower shall,
substantially simultaneously with (and in any event not later than the
third Business Day next following) the occurrence of such Equity Issuance,
apply Net Cash Proceeds therefrom in an amount equal to 50% of the net cash
proceeds of the Capital Stock sold in such initial public offering (whether
or not all such Capital Stock is offered by the Borrower or Holding) to
prepay outstanding Term Loans and/or Acquisition Loans and/or reduce the
Revolving Credit Commitment in accordance with Section 2.13(g); provided,
however, that the remaining portion of such Net Cash Proceeds shall be
applied either (A) pursuant to Section 6.05(a)(iii) for the redemption of
Exchangeable Preferred Stock (including accreted PIK liquidation
preference) or (B) to prepay outstanding Term Loans and/or Acquisition
Loans and/or reduce the Revolving Credit Commitment in accordance with
Section 2.13(g); and
(ii) an Equity Issuance occurs other than as part of an initial public
offering of the Capital Stock of the Borrower or Holding, the Borrower
shall, substantially simultaneously with (and in any event not later than
the third Business Day next following) the occurrence of such Equity
Issuance, apply 100% of the Net Cash Proceeds therefrom to prepay
outstanding Term Loans and/or Acquisition Loans and/or reduce the Revolving
Credit Commitment in accordance with Section 2.13(g); provided that upon
notice to Administrative Agent of such equity investment, Xxxxxxx Xxxxxx,
any Affiliate of Xxxxxxx Xxxxxx or any shareholder of Holding or Borrower
may directly or indirectly invest in Borrower after the Effective Date up
to an additional $5,000,000 in Capital Stock other than Disqualified Stock,
the proceeds of which may be retained by Borrower and utilized by Borrower
in the ordinary course of its business.
(d) Beginning with the fiscal year ending nearest to December 31,
1999, no later than the earlier of (i) 90 days after the end of each fiscal year
of the Borrower, and (ii) the date on which the financial statements with
respect to such period are delivered pursuant to
44
Exhibit 10.1
Section 5.04(a), the Borrower shall prepay outstanding Term Loans and/or
Acquisition Loans in accordance with Section 2.13(g) in an aggregate principal
amount equal to 75% (or 50%, for fiscal years for which the Debt/Adjusted EBITDA
Ratio for such fiscal year is less than 5:1) of Excess Cash Flow for the fiscal
year then ended.
(e) In the event that any Credit Party or any subsidiary of a Credit
Party shall receive Net Cash Proceeds from the Incurrence of Debt of the
Borrower or any of its Subsidiaries (other than any proceeds of Debt permitted
pursuant to Section 6.01), the Borrower shall, substantially simultaneously with
(and in any event not later than the third Business Day next following) the
receipt of such Net Cash Proceeds by the Borrower or such Subsidiary, apply an
amount equal to 100% of such Net Cash Proceeds to prepay outstanding Term Loans
and/or Acquisition Loans and/or reduce the Revolving Credit Commitment in
accordance with Section 2.13(g).
(f) In the event that there shall occur any Casualty or Condemnation
and, pursuant to Section 5.12, the Casualty Proceeds or Condemnation Proceeds,
as the case may be, are required to be used to prepay the Loans, then the
Borrower shall apply an amount equal to 100% of such Casualty Proceeds or
Condemnation Proceeds, as the case may be, to prepay outstanding Term Loans
and/or Acquisition Loans and/or reduce the Revolving Credit Commitment in
accordance with Section 2.13(g).
(g) Other than as may be provided in Section 2.13(b)(II)(i),
mandatory prepayments shall be applied first to the Term Loans to the full
extent thereof and if no Term Loans are outstanding shall be applied second to
the Acquisition Loans to the full extent thereof and if no Acquisition Loans are
outstanding, the Revolving Credit Commitments shall be permanently reduced by an
amount equal to the amount of such mandatory prepayment and, if required by
Section 2.13(a), to prepay Revolving Loans. Mandatory prepayments under this
Agreement shall be applied pro rata against the remaining scheduled installments
of principal due in respect of the Term Loans or Acquisition Loans under Section
2.11; provided that any mandatory prepayments of the Term Loans and/or
Acquisition Loans made pursuant to Section 2.13(b)(II)(ii) shall be applied to
the remaining scheduled installments in inverse order of maturity.
(h) The Borrower shall deliver to the Administrative Agent, at the
time of each prepayment required under this Section, (i) a certificate signed by
a Responsible Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable,
at least three days prior written notice of such prepayment. Each notice of
prepayment shall specify the prepayment date, the Type of each Loan being
prepaid and the principal amount of each Loan (or portion thereof) to be
prepaid. All prepayments of Borrowings under this Section shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.
(i) Amounts to be applied pursuant to this Section to the prepayment
of Term Loans and Revolving Loans shall be applied, as applicable, first to
reduce outstanding ABR Term Loans and ABR Revolving Loans. Any amounts remaining
after each such application shall, at the option of the Borrower, be applied to
prepay Eurodollar Term Loans or Eurodollar Revolving Loans, as the case may be,
immediately and/or shall be deposited in the Prepayment Account (as defined
below). The Administrative Agent shall apply any cash deposited in the
Prepayment
45
Exhibit 10.1
Account (i) allocable to Term Loans to prepay Eurodollar Term Loans and (ii)
allocable to Revolving Loans to prepay Eurodollar Revolving Loans, in each case
on the last day of their respective Interest Periods (or, at the direction of
the Borrower, on any earlier date) until all outstanding Term Loans or Revolving
Loans, as the case may be, have been prepaid or until all the allocable cash on
deposit with respect to such Loans has been exhausted. For purposes of this
Agreement, the term "Prepayment Account" means an account established by the
Borrower with the Administrative Agent and over which the Administrative Agent
shall have exclusive dominion and control, including the exclusive right of
withdrawal for application in accordance with this clause. The Administrative
Agent will, at the request of the Borrower, invest amounts on deposit in the
Prepayment Account in Permitted Investments that mature prior to the last day of
the applicable Interest Periods of the Eurodollar Term Borrowings or Eurodollar
Revolving Borrowings to be prepaid, as the case may be; provided, however, that
(i) the Administrative Agent shall not be required to make any investment that,
in its sole judgment, would require or cause the Administrative Agent to be in,
or would result in any, violation of any law, statute, rule or regulation and
(ii) the Administrative Agent shall have no obligation to invest amounts on
deposit in the Prepayment Account if a Default or Event of Default shall have
occurred and be continuing. The Borrower shall indemnify the Administrative
Agent for any losses relating to the investments so that the amount available to
prepay Eurodollar Borrowings on the last day of the applicable Interest Period
is not less than the amount that would have been available had no investments
been made pursuant thereto. Other than any interest earned on such investments,
the Prepayment Account shall not bear interest. Interest or profits, if any, on
such investments shall be deposited in the Prepayment Account and reinvested and
disbursed as specified above. If the maturity of the Loans has been accelerated
pursuant to Article VII, the Administrative Agent may, in its sole discretion,
apply all amounts on deposit in the Prepayment Account to satisfy any of the
Obligations. The Borrower hereby grants to the Administrative Agent, for its
benefit and the benefit of the Issuing Bank, the Swingline Lender and the
Lenders, a security interest in the Prepayment Account to secure the
Obligations.
SECTION 2.14. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision of this Agreement, if after
the date of this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender or
the Issuing Bank of the principal of or interest on any Eurodollar Loan made by
such Lender or any Fees or other amounts payable hereunder (other than changes
in respect of taxes based on the overall net income of such Lender or the
Issuing Bank by the jurisdiction in which such Lender or the Issuing Bank has
its principal office or by any political subdivision or taxing authority
therein), or shall impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of or credit extended by any Lender or the Issuing Bank (except any such
reserve requirement which is reflected in the Adjusted Eurodollar Rate) or shall
impose on such Lender or the Issuing Bank or the London interbank market any
other condition affecting this Agreement or Eurodollar Loans made by such Lender
or any Letter of Credit or participation therein, and the result of any of the
foregoing shall be to increase the cost to such Lender or the Issuing Bank of
making or maintaining any Eurodollar Loan or increase the cost to any Lender of
issuing or maintaining any Letter of Credit or purchasing or maintaining a
participation therein or to reduce the amount of any sum received or receivable
by such Lender or the Issuing Bank hereunder or under the Notes
46
Exhibit 10.1
(whether of principal, interest or otherwise) by an amount deemed by such Lender
or the Issuing Bank to be material, then the Borrower will pay to such Lender or
the Issuing Bank, as the case may be, upon demand such additional amount or
amounts as will compensate such Lender or the Issuing Bank, as the case may be,
for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank shall have determined that the
adoption after the Closing Date of any law, rule, regulation, agreement or
guideline regarding capital adequacy, or any change after the Closing Date in
any such law, rule, regulation, agreement or guideline (whether such law, rule,
regulation, agreement or guideline has been adopted) or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by any Lender (or any
lending office of such Lender) or the Issuing Bank or any Lender's or the
Issuing Bank's holding company with any request or directive regarding capital
adequacy (whether or not having the force of law) of any Governmental Authority
has or would have the effect of reducing the rate of return on such Lender's or
the Issuing Bank's capital or on the capital of such Lender's or the Issuing
Bank's holding company, if any, as a consequence of this Agreement or the Loans
made or participations in Letters of Credit purchased by such Lender pursuant
hereto or the Letters of Credit issued by the Issuing Bank pursuant hereto to a
level below that which such Lender or the Issuing Bank or such Lender's or the
Issuing Bank's holding company could have achieved but for such applicability,
adoption, change or compliance (taking into consideration such Lender's or the
Issuing Bank's policies and the policies of such Lender's or the Issuing Bank's
holding company with respect to capital adequacy) by an amount deemed by such
Lender or the Issuing Bank to be material, then from time to time the Borrower
shall pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
or such Lender's or the Issuing Bank's holding company for any such reduction
suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
holding company, as applicable, as specified in clause (a) or (b), and showing
the method of calculation in reasonable detail, shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender or the Issuing Bank the amount shown as due on any such certificate
delivered by it within 10 days after its receipt of the same.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation. The
protection of this Section shall be available to each Lender and the Issuing
Bank regardless of any possible contention of the invalidity or inapplicability
of the law, rule, regulation, agreement, guideline or other change or condition
that shall have occurred or been imposed. If such Lender receives a refund of
any such amount, such Lender will promptly pay such amount over to the Borrower.
SECTION 2.15. Change in Legality.
(a) Notwithstanding any other provision of this Agreement, if, after
the Closing Date, any change in any law or regulation or in the interpretation
thereof by any Governmental Authority charged with the administration or
interpretation thereof shall make it unlawful for any Lender to make or maintain
any Eurodollar Loan or to give effect to its obligations as
47
Exhibit 10.1
contemplated hereby with respect to any Eurodollar Loan, then, by written notice
to the Borrower and to the Administrative Agent:
(i) such Lender may declare that Eurodollar Loans will not thereafter
(for the duration of such unlawfulness) be made by such Lender hereunder
(or be continued for additional Interest Periods and ABR Loans will not
thereafter (for such duration) be converted into Eurodollar Loans),
whereupon any request for a Eurodollar Borrowing (or to convert an ABR
Borrowing to a Eurodollar Borrowing or to continue a Eurodollar Borrowing
for an additional Interest Period) shall, as to such Lender only, be deemed
a request for an ABR Loan (or a request to continue an ABR Loan as such for
an additional Interest Period or to convert a Eurodollar Loan into an ABR
Loan, as the case may be), unless such declaration shall be subsequently
withdrawn; and
(ii) such Lender may require that all outstanding Eurodollar Loans
made by it be converted to ABR Loans, in which event all such Eurodollar
Loans shall be automatically converted to ABR Loans as of the effective
date of such notice as provided in clause (b).
In the event any Lender shall exercise its rights under clause (i) or (ii), all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan made by such Lender, if
lawful, on the last day of the Interest Period currently applicable to such
Eurodollar Loan; in all other cases such notice shall be effective on the date
of receipt by the Borrower.
SECTION 2.16. Indemnity. The Borrower shall indemnify each Lender
against any loss or expense that such Lender may sustain or incur as a
consequence of (a) any event, other than a default by such Lender in the
performance of its obligations hereunder, which results in (i) such Lender
receiving or being deemed to receive any amount on account of the principal of
any Eurodollar Loan prior to the end of the Interest Period in effect therefor,
(ii) the conversion of any Eurodollar Loan to an ABR Loan, or the conversion of
the Interest Period with respect to any Eurodollar Loan, in each case other than
on the last day of the Interest Period in effect therefor, or (iii) any
Eurodollar Loan to be made by such Lender (including any Eurodollar Loan to be
made pursuant to a conversion or continuation under Section 2.10) not being made
after notice of such Loan shall have been given by the Borrower hereunder (any
of the events referred to in this clause being called a "Breakage Event") or (b)
any default in the making of any payment or prepayment required to be made
hereunder. In the case of any Breakage Event, such loss shall include an amount
equal to the excess, as reasonably determined by such Lender, of (i) its cost of
obtaining funds for the Eurodollar Loan that is the subject of such Breakage
Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to
48
Exhibit 10.1
receive pursuant to this Section with calculations in reasonable detail shall be
delivered to the Borrower and shall be conclusive absent manifest error.
SECTION 2.17. Pro Rata Treatment. Except as provided below in this
Section with respect to Swingline Loans and as required under Section 2.15, each
Borrowing, each payment or prepayment of principal of any Borrowing, each
payment of interest on the Loans, each payment of the Commitment Fees, each
reduction of the Term Loan Commitments or the Revolving Credit Commitments and
each conversion of any Borrowing to or continuation of any Borrowing as a
Borrowing of any Type shall be allocated pro rata among the Lenders in
accordance with their respective applicable Commitments (or, if such Commitments
shall have expired or been terminated, in accordance with the respective
principal amounts of their outstanding Loans and participations in unreimbursed
drawings under Letters of Credit). For purposes of determining the available
Revolving Credit Commitments of the Lenders at any time, each outstanding
Swingline Loan shall be deemed to have utilized the Revolving Credit Commitments
of the Lenders (including those Lenders which shall not have made Swingline
Loans) pro rata in accordance with such respective Revolving Credit Commitments.
Each Lender agrees that in computing such Lender's portion of any Borrowing to
be made hereunder, the Administrative Agent may, in its discretion, round each
Lender's percentage of such Borrowing to the next higher or lower whole dollar
amount.
SECTION 2.18. Sharing of Setoffs. Each Lender agrees that if it or
any Affiliate of such Lender shall, through the exercise of a right of banker's
lien, setoff or counterclaim against the Borrower or any other Credit Party or
any Affiliate of any Credit Party, 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 or any
Affiliate of such Lender under any applicable bankruptcy, insolvency or other
similar law or otherwise, or by any other means, obtain payment (voluntary or
involuntary) in respect of any Loan or Loans or L/C Disbursement as a result of
which the unpaid principal portion of its Term Loans and Revolving Loans and
participations in L/C Disbursements shall be proportionately less than the
unpaid principal portion of the Term Loans and Revolving Loans and
participations in L/C Disbursements of any other Lender, it shall be deemed
simultaneously to have purchased from such other Lender at face value, and shall
promptly pay to such other Lender the purchase price for, a participation in the
Term Loans and Revolving Loans and L/C Exposure, as the case may be of such
other Lender, so that the aggregate unpaid principal amount of the Term Loans
and Revolving Loans and L/C Exposure and participations in Term Loans and
Revolving Loans and L/C Exposure held by each Lender shall be in the same
proportion to the aggregate unpaid principal amount of all Term Loans and
Revolving Loans and L/C Exposure then outstanding as the principal amount of its
Term Loans and Revolving Loans and L/C Exposure prior to such exercise of
banker's lien, setoff or counterclaim or other event was to the principal amount
of all Term Loans and Revolving Loans and L/C Exposure outstanding prior to such
exercise of banker's lien, setoff or counterclaim or other event; provided,
however, that if any such purchase or purchases or adjustments shall be made
pursuant to this Section and the payment giving rise thereto shall thereafter be
recovered, such purchase or purchases or adjustments shall be rescinded to the
extent of such recovery and the purchase price or prices or adjustment restored
without interest. The Borrower and Holding consent to the foregoing arrangements
and agree that any Lender or any Affiliate of such Lender holding a
participation in a Term Loan or Revolving Loan or L/C Disbursement deemed to
have been so purchased may exercise any and all rights of banker's lien, setoff
or counterclaim with respect to any and all moneys owing by the Borrower and
Holding or any other Credit Party or
49
Exhibit 10.1
any Affiliate of any Credit Party, to such Lender by reason thereof as fully as
if such Lender had made a Loan directly to the Borrower in the amount of such
participation.
SECTION 2.19. Payments.
(a) The Borrower shall make each payment (including principal of or
interest on any Borrowing or any L/C Disbursement or any Fees or other amounts)
hereunder and under any other Credit Document not later than 12:00 (noon), New
York City time, on the date when due in immediately available dollars, without
setoff, defense or counterclaim. Each such payment (other than (i) Issuing Bank
Fees, which shall be paid directly to the Issuing Bank, and (ii) principal of
and interest on Swingline Loans, which shall be paid directly to the Swingline
Lender except as otherwise provided in Section 2.21(e)) shall be made to the
Administrative Agent at its offices at identified in Annex 2.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Credit
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.20. Taxes.
(a) Any and all payments by or on behalf of the Borrower or any
Credit Party hereunder and under any other Credit Document shall be made, in
accordance with Section 2.19, free and clear of and without deduction for any
and all current or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding (i) taxes
imposed on the net income of the Administrative Agent, any Lender or the Issuing
Bank (or any transferee or assignee thereof, including a participation holder
(any such entity a "Transferee")) and (ii) franchise taxes imposed on the net
income of the Administrative Agent, any Lender or the Issuing Bank (or
Transferee), in each case by the jurisdiction under the laws of which the
Administrative Agent, such Lender or the Issuing Bank (or Transferee) is
organized (or where its lending office is located) or any political subdivision
thereof (all such nonexcluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities, collectively or individually, being called
"Taxes"). If the Borrower or any Credit Party shall be required to deduct any
Taxes from or in respect of any sum payable hereunder or under any other Credit
Document to the Administrative Agent, any Lender or the Issuing Bank (or any
Transferee), (i) the sum payable shall be increased by the amount (an
"additional amount") necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, such Lender or the Issuing Bank (or Transferee), as
the case may be, shall receive an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrower or such Credit Party shall
make such deductions and (iii) the Borrower or such Credit Party shall pay the
full amount deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, the Borrower agrees to pay to the relevant
Governmental Authority in accordance with applicable law any current or future
stamp, documentary, excise, transfer, sales, property taxes, charges or similar
levies (including mortgage recording taxes and similar fees) that arise from any
payment made hereunder or under any other Credit Document or
50
Exhibit 10.1
from the execution, delivery, enforcement or registration of, or otherwise with
respect to, this Agreement or any other Credit Document ("Other Taxes").
(c) The Borrower will indemnify the Administrative Agent, each Lender
and the Issuing Bank (or Transferee) for the full amount of Taxes and Other
Taxes paid by the Administrative Agent, such Lender or the Issuing Bank (or
Transferee), as the case may be, and any liability (including penalties,
interest and expenses (including reasonable attorney's fees and expenses
(including the allocated costs of in-house legal counsel))) arising therefrom or
with respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability prepared by the Administrative Agent, a
Lender or the Issuing Bank (or Transferee), or the Administrative Agent on its
behalf showing calculations in reasonable detail, absent manifest error, shall
be final, conclusive and binding for all purposes. Such indemnification shall be
made within 30 days after the date the Administrative Agent, any Lender or the
Issuing Bank (or Transferee), as the case may be, makes written demand therefor.
(d) As soon as practicable after the date of any payment of Taxes or
Other Taxes by the Borrower or any other Credit Party to the relevant
Governmental Authority, the Borrower or such other Credit Party will deliver to
the Administrative Agent, at its address referred to in Section 9.01, the
original or a certified copy of a receipt issued by such Governmental Authority
evidencing payment thereof.
(e) Each Lender (or Transferee) that is organized under the laws of a
jurisdiction other than the United States, any State thereof or the District of
Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the
Administrative Agent two copies of either United States Internal Revenue Service
Form 1001 or Form 4224, or, in the case of a Non-U.S. Lender claiming exemption
from U.S. Federal withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments of "portfolio interest", a Form W-8, or any subsequent
versions thereof or successors thereto (and, if such Non-U.S. Lender delivers a
Form W-8, a certificate representing that such Non-U.S. Lender is not a bank for
purposes of Section 881(c) of the Code, is not a 10-percent shareholder (within
the meaning of Section 871(h)(3)(B) of the Code) of the Borrower and is not a
controlled foreign corporation related to the Borrower (within the meaning of
Section 864(d)(4) of the Code)), properly completed and duly executed by such
Non-U.S. Lender claiming complete exemption from, or reduced rate of, U.S.
Federal withholding tax on payments by the Borrower under this Agreement and the
other Credit Documents. Such forms shall be delivered by each Non-U.S. Lender on
or before the date it becomes a party to this Agreement (or, in the case of a
Transferee that is a participation holder, on or before the date such
participation holder becomes a Transferee hereunder) and on or before the date,
if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a "New Lending Office"). In addition,
each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non-U.S. Lender.
Notwithstanding any other provision of this Section 2.20(e), a Non-U.S. Lender
shall not be required to deliver any form pursuant to this Section 2.20(e) that
such Non-U.S. Lender is not legally able to deliver.
(f) The Borrower shall not be required to indemnify any Non-U.S.
Lender or to pay any additional amounts to any Non-U.S. Lender, in respect of
United States Federal withholding tax pursuant to clause (a) or (c) to the
extent that (i) the obligation to withhold
51
Exhibit 10.1
amounts with respect to United States Federal withholding tax existed and would
apply to payments made to such Non-U.S. Lender on the date such Non-U.S. Lender
became a party to this Agreement (or, in the case of a Transferee that is a
participation holder, on the date such participation holder became a Transferee
hereunder) or, with respect to payments to a New Lending Office, the date such
Non-U.S. Lender designated such New Lending Office with respect to a Loan;
provided, however, that this clause shall not apply (x) to any Transferee or New
Lending Office that becomes a Transferee or New Lending Office as a result of an
assignment, participation, transfer or designation made at the request of the
Borrower and (y) to the extent the indemnity payment or additional amounts any
Transferee, or any Lender (or Transferee), acting through a New Lending Office,
would be entitled to receive (without regard to this clause) do not exceed the
indemnity payment or additional amounts that the person making the assignment,
participation or transfer to such Transferee, or Lender (or Transferee) making
the designation of such New Lending Office, would have been entitled to receive
in the absence of such assignment, participation, transfer or designation or
(ii) the obligation to pay such additional amounts would not have arisen but for
a failure by such Non-U.S. Lender to comply with the provisions of clause (e).
(g) Nothing contained in this Section shall require any Lender or the
Issuing Bank (or any Transferee) or the Administrative Agent to make available
any of its tax returns (or any other information that it deems to be
confidential or proprietary). If any Lender receives a refund of any additional
amount or any taxes paid by or on behalf of such Lender, such Lender will
promptly pay such amount over to the Borrower.
SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate.
(a) In the event (i) any Lender or the Issuing Bank delivers a
certificate requesting compensation pursuant to Section 2.14, (ii) any Lender or
the Issuing Bank delivers a notice described in Section 2.15 or (iii) the
Borrower is required to pay any additional amount to any Lender or the Issuing
Bank or any Governmental Authority on account of any Lender or the Issuing Bank
pursuant to Section 2.20, the Borrower may, at its sole expense and effort
(including with respect to the processing and recordation fee referred to in
Section 9.04(b)), upon notice to such Lender or the Issuing Bank and the
Administrative Agent, require such Lender or the Issuing Bank to transfer and
assign, without recourse (in accordance with and subject to the restrictions
contained in Section 9.04), all of its interests, rights and obligations under
this Agreement to an assignee that shall assume such assigned obligations (which
assignee may be another Lender, if a Lender accepts such assignment); provided
that (x) such assignment shall not conflict with any law, rule or regulation or
order of any court or other Governmental Authority having jurisdiction, (y) the
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Credit Commitment is being assigned, of the Issuing
Bank and the Swingline Lender), which consent shall not unreasonably be
withheld, and (z) the Borrower or such assignee shall have paid to the affected
Lender or the Issuing Bank in immediately available funds an amount equal to the
sum of the principal of and interest accrued to the date of such payment on the
outstanding Loans or L/C Disbursements of such Lender or the Issuing Bank,
respectively, plus all Fees and other amounts accrued for the account of such
Lender or the Issuing Bank hereunder (including any amounts under Section 2.14
and Section 2.16); provided further that, if prior to any such transfer and
assignment the circumstances or event that resulted in such Lender's or the
Issuing Bank's claim for compensation under Section 2.14 or notice under Section
2.15 or the
52
Exhibit 10.1
amounts paid pursuant to Section 2.20, as the case may be, cease to cause such
Lender or the Issuing Bank to suffer increased costs or reductions in amounts
received or receivable or reduction in return on capital, or cease to have the
consequences specified in Section 2.15, or cease to result in amounts being
payable under Section 2.20, as the case may be (including as a result of any
action taken by such Lender or the Issuing Bank pursuant to clause (b)), or if
such Lender or the Issuing Bank shall waive its right to claim further
compensation under Section 2.14 in respect of such circumstances or event or
shall withdraw its notice under Section 2.15 or shall waive its right to further
payments under Section 2.20 in respect of such circumstances or event, as the
case may be, then such Lender or the Issuing Bank shall not thereafter be
required to make any such transfer and assignment hereunder.
(b) If (i) any Lender or the Issuing Bank shall request
compensation under Section 2.14, (ii) any Lender or the Issuing Bank delivers a
notice described in Section 2.15 or (iii) the Borrower is required to pay any
additional amount to any Lender or the Issuing Bank or any Governmental
Authority on account of any Lender or the Issuing Bank, pursuant to Section
2.20, then such Lender or the Issuing Bank shall use reasonable efforts (which
shall not require such Lender or the Issuing Bank to incur an unreimbursed loss
or unreimbursed cost or expense or otherwise take any action inconsistent with
its internal policies or legal or regulatory restrictions or suffer any
disadvantage or burden deemed by it to be significant) (x) to file any
certificate or document reasonably requested in writing by the Borrower or (y)
to assign its rights and delegate and transfer its obligations hereunder to
another of its offices, branches or affiliates, if such filing or assignment
would materially reduce its claims for compensation under Section 2.14 or enable
it to withdraw its notice pursuant to Section 2.15 or would materially reduce
amounts payable pursuant to Section 2.20, as the case may be, in the future. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender or the Issuing Bank in connection with any such filing or assignment,
delegation and transfer.
SECTION 2.22. Swingline Loans.
(a) Swingline Commitment. Subject to the terms and conditions
and relying upon the representations and warranties herein set forth, the
Swingline Lender agrees to make loans to the Borrower at any time and from time
to time on and after the Closing Date and until the earlier of the Revolving
Credit Maturity Date and the termination of the Revolving Credit Commitments in
accordance with the terms hereof, in an aggregate principal amount at any time
outstanding that will not result in (i) the aggregate principal amount of all
Swingline Loans exceeding $5,000,000 in the aggregate or (ii) the Aggregate
Revolving Credit Exposure, after giving effect to any Swingline Loan, exceeding
the Total Revolving Credit Commitment. Each Swingline Loan shall be in a
principal amount that is an integral multiple of $100,000. The Swingline
Commitment may be terminated or reduced from time to time as provided herein.
Within the foregoing limits, the Borrower may borrow, pay or prepay and reborrow
Swingline Loans hereunder, subject to the terms, conditions and limitations set
forth herein.
(b) Swingline Loans. The Borrower shall notify the
Administrative Agent by telecopy or by telephone, not later than 1:00 p.m., New
York City time, on the day of a proposed Swingline Loan. Such notice shall be
delivered on a Business Day, shall be irrevocable and shall refer to this
Agreement. Promptly after such notification, the Borrower shall hand deliver or
telecopy to the Administrative Agent a duly completed Borrowing Request
confirming such notification. Each such Borrowing Request shall be signed by or
on behalf of the Borrower and
53
Exhibit 10.1
shall specify: (i) that the Borrower is requesting a Swingline Loan, (ii) the
requested date of such Swingline Loan (which shall be a Business Day), (iii) the
number and location of the account to which funds are to be disbursed (which
shall be an account that complies with the requirements of Section 2.02(c)), and
(iv) the amount of such Swingline Loan. The Administrative Agent will promptly
advise the Swingline Lender of any notice received from the Borrower pursuant to
this clause. The Swingline Lender shall make each Swingline Loan available to
the Borrower by means of a credit to the account specified in the Borrowing
Request by 4:00 p.m., New York City time, on the date such Swingline Loan is so
requested.
(c) Prepayment. The Borrower shall have the right at any time
and from time to time to prepay any Swingline Loan, in whole or in part, upon
giving written or telecopy notice (or telephone notice promptly confirmed by
written, or telecopy notice) to the Swingline Lender and to the Administrative
Agent before 12:00 (noon), New York City time on the date of prepayment at the
Swingline Lender's address for notices specified on Annex 2.
(d) Interest. Each Swingline Loan shall be an ABR Loan and,
subject to the provisions of Section 2.07, shall bear interest as provided in
Section 2.06(a).
(e) Conversion to Revolving Loans. With respect to any
Swingline Loans, the Swingline Lender may, at any time in its sole and absolute
discretion, deliver to Administrative Agent (with a copy to the Borrower ) no
later than 11:00 a.m. (New York City time) on the first Business Day in advance
of the proposed Funding Date, a notice (which shall be deemed to be a Borrowing
Request given by the Borrower) requesting the Lenders to make Revolving Loans
that are ABR Loans on such Funding Date in an amount equal to the amount of such
Swing Line Loans outstanding on the date such notice is given which Swing Line
Lender requests the Lenders to prepay; provided, however, that the obligations
of the Lenders to fund such Borrowing shall not be subject to Section 4.01.
(f) Participations. Upon the Borrowing of a Swingline Loan,
each Revolving Credit Lender shall be deemed to have automatically acquired a
unfunded participation in such Swingline Loan proportional to its Applicable
Percentage. Upon demand by the Swingline Lender, or automatically upon the
occurrence of an Event of Default under Section 7.01(g) or (h), each Revolving
Credit Lender shall fund such participation by paying to the Administrative
Agent, for the account of the Swingline Lender, such Revolving Credit Lender's
Applicable Percentage of such Swingline Loan, together with interest accruing on
such participation amount from the date of such Event of Default or such demand,
as the case may be, at the Federal Funds Effective Rate for the first day, and
for each day thereafter, the rate of interest then applicable to ABR Revolving
Loans. Each Lender acknowledges and agrees that its obligation to acquire
participations in Swingline Loans pursuant to this clause is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or an Event of Default,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever. Each Lender shall comply with its
obligation under this clause by wire transfer of immediately available funds, in
the same manner as provided in Section 2.02(c) with respect to Loans made by
such Lender and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Lenders. The Administrative Agent
shall notify the Borrower of any participations in any Swingline Loan acquired
pursuant to this clause and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the Swingline Lender.
Any amounts received by
54
Exhibit 10.1
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this clause and to the Swingline
Lender, as their interests may appear. The purchase of participations in a
Swingline Loan pursuant to this clause shall not relieve the Borrower (or other
party liable for obligations of the Borrower) of any default in the payment
thereof.
If for any reason the Revolving Credit Commitments are
terminated at a time when any Swing Line Loans are outstanding, each Lender
shall be deemed to have purchased, and hereby agrees to purchase, a
participation in such outstanding Swing Line Loans in an amount equal to its
Applicable Percentage calculated immediately prior to such termination of the
Revolving Credit Commitments ) of the unpaid amount of such Swing Line Loans
together with accrued interest thereon. Upon one Business Day's notice from the
Swingline Lender, each Lender shall deliver to the Swingline Lender an amount
equal to its respective participation in same day funds to the Administrative
Agent at its offices identified in Annex 2. In order to further evidence such
participation (and without prejudice to the effectiveness of the participation
provisions set forth above), each Lender shall enter into a separate
participation agreement at the request of the Swingline Lender in form and
substance reasonably satisfactory to such Lender and the Swingline Lender. If
any Lender fails to make available to the Swingline Lender the amount of such
Lender's participation as provided in this paragraph, the Swingline Lender shall
be entitled to recover such amount of demand from such Lender together with
interest thereon at the Federal Funds Effective Rate for one Business Day and
thereafter at the rate applicable to ABR Revolving Loans. If the Swingline
Lender receives a payment of any amount in which other Lenders have purchased
participations as provided in the Paragraph, the Swingline Lender shall promptly
distribute to each such other Lender its Applicable Percentage of such payment.
SECTION 2.23. Letters of Credit.
(a) General. The Borrower may request the issuance of a Letter
of Credit for its own account, by delivering a Letter of Credit Request at any
time and from time to time while the Revolving Credit Commitments remain in
effect. This Section shall not be construed to impose an obligation upon the
Issuing Bank to issue any Letter of Credit that is inconsistent with the terms
and conditions of this Agreement.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. In order to request the issuance of a Letter of Credit (or to amend,
renew or extend an existing Letter of Credit), the Borrower shall hand deliver
or telecopy to the Issuing Bank and the Administrative Agent (reasonably in
advance of the requested date of issuance, amendment, renewal or extension) a
Letter of Credit Request requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, the date of
issuance, amendment, renewal or extension, the date on which such Letter of
Credit is to expire (which shall comply with clause (c)), the amount of such
Letter of Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare such Letter of Credit. A Letter of
Credit shall be issued, amended, renewed or extended only if, and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that, after giving effect to such issuance,
amendment, renewal or
55
Exhibit 10.1
extension (A) the L/C Exposure shall not exceed $7,500,000 and (B) the Aggregate
Revolving Credit Exposure shall not exceed the Total Revolving Credit
Commitment.
(c) Expiration Date. Each Letter of Credit shall expire at
the close of business no later than the first anniversary of the date of the
issuance of such Letter of Credit, unless such Letter of Credit expires by its
terms on an earlier date; provided, however, that this clause shall not prevent
any Issuing Bank from agreeing that a Letter of Credit will automatically be
extended for one or more successive periods not to exceed one year each unless
such Issuing Bank elects not to extend for any such additional period.
Notwithstanding the foregoing, no Letter of Credit shall expire later than the
fifth Business Days prior to the Revolving Credit Maturity Date.
(d) Participations. By the issuance of a Letter of Credit
and without any further action on the part of the Issuing Bank or the Lenders,
the Issuing Bank hereby grants to each Revolving Credit Lender, and each such
Lender hereby acquires from the applicable Issuing Bank, a participation in such
Letter of Credit equal to such Lender's Applicable Percentage of the aggregate
amount available to be drawn under such Letter of Credit, effective upon the
issuance of such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Credit Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of the Issuing Bank,
such Lender's Applicable Percentage of each L/C Disbursement made by the Issuing
Bank and not reimbursed by the Borrower (or, if applicable, another party
pursuant to its obligations under any other Credit Document) forthwith on the
date due as provided in Section 2.02(e). Each Revolving Credit Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this clause in respect of Letters of Credit is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or an Event of Default, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, the Borrower shall pay to the
Issuing Bank an amount equal to such L/C Disbursement on the same Business Day
on which the Borrower shall have received notice from the Issuing Bank that
payment of such draft will be made, or, if the Borrower shall have received such
notice later than 12:00 noon, New York City time, on any Business Day, not later
than 11:00 a.m., New York City time, on the immediately following Business Day.
(f) Obligations Absolute. The Borrower's obligations to
reimburse L/C Disbursements as provided in clause (e) shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement, under any and all circumstances whatsoever,
and irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or any Credit Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of any Letter of Credit or any Credit
Document;
(iii) the existence of any claim, setoff, defense or other
right that the Borrower, any other party guaranteeing, or otherwise
obligated with, the Borrower, any Subsidiary or other Affiliate thereof
or any other person may at any time have against the beneficiary
56
Exhibit 10.1
under any Letter of Credit, the Issuing Bank, the Administrative Agent or
any Lender or any other person, whether in connection with this
Agreement, any other Credit Document or any other related or unrelated
agreement or transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect;
(v) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of
the Issuing Bank, the Lenders, the Administrative Agent or any other
person or any other event or circumstance whatsoever, whether or not
similar to any of the foregoing, that might, but for the provisions of
this Section, constitute a legal or equitable discharge of the Borrower's
obligations hereunder.
Without limiting the generality of the foregoing, it is
expressly understood and agreed that the absolute and unconditional obligation
of the Borrower hereunder to reimburse L/C Disbursements will not be excused by
the gross negligence or wilful misconduct of the Issuing Bank. However, the
foregoing shall not be construed to excuse the Issuing Bank from liability to
the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
the Issuing Bank's gross negligence or wilful misconduct in determining whether
drafts and other documents presented under a Letter of Credit comply with the
terms thereof; it is understood that the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary and, in
making any payment under any Letter of Credit (i) the Issuing Bank's exclusive
reliance on the documents presented to it under such Letter of Credit as to any
and all matters set forth therein, including reliance on the amount of any draft
presented under such Letter of Credit, whether or not the amount due to the
beneficiary thereunder equals the amount of such draft and whether or not any
document presented pursuant to such Letter of Credit proves to be insufficient
in any respect, if such document on its face appears to be in order, and whether
or not any other statement or any other document presented pursuant to such
Letter of Credit proves to be forged or invalid or any statement therein proves
to be inaccurate or untrue in any respect whatsoever and (ii) any noncompliance
in any immaterial respect of the documents presented under such Letter of Credit
with the terms thereof shall, in each case, be deemed not to constitute wilful
misconduct or gross negligence of the Issuing Bank.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall as promptly
as possible give telephonic notification, confirmed by telecopy, to the
Administrative Agent and the Borrower of such demand for payment and whether the
Issuing Bank has made or will make an L/C Disbursement thereunder; provided that
any failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Revolving
Credit Lenders with respect to any
57
Exhibit 10.1
such L/C Disbursement. The Administrative Agent shall promptly give each
Revolving Credit Lender notice thereof.
(h) Interim Interest. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, then, unless the Borrower shall
reimburse such L/C Disbursement in full on such date, the unpaid amount thereof
shall bear interest for the account of the Issuing Bank, for each day from and
including the date of such L/C Disbursement, to but excluding the earlier of the
date of payment by the Borrower or the date on which interest shall commence to
accrue thereon as provided in Section 2.02(e), at the rate per annum that would
apply to such amount if such amount were an ABR Loan.
(i) Resignation or Removal of the Issuing Bank. The Issuing
Bank may resign at any time by giving 180 days' prior written notice to the
Administrative Agent, the Lenders and the Borrower, and may be removed at any
time by the Borrower by notice to the Issuing Bank, the Administrative Agent and
the Lenders, to be effective only upon the appointment of a successor Issuing
Bank pursuant to the following sentence. Subject to the next succeeding clause,
upon the acceptance of any appointment as the Issuing Bank hereunder by a Lender
that shall agree to serve as successor Issuing Bank, such successor shall
succeed to and become vested with all the interests, rights and obligations of
the retiring Issuing Bank and the retiring Issuing Bank shall be discharged from
its obligations to issue additional Letters of Credit hereunder. At the time
such removal or resignation shall become effective, the Borrower shall pay all
accrued and unpaid fees pursuant to Section 2.05(d)(ii). The acceptance of any
appointment as the Issuing Bank hereunder by a successor Lender shall be
evidenced by an agreement entered into by such successor, in a form satisfactory
to the Borrower and the Administrative Agent, and, from and after the effective
date of such agreement, (i) such successor Lender shall have all the rights and
obligations of the previous Issuing Bank under this Agreement and the other
Credit Documents and (ii) references herein and in the other Credit Documents to
the term "Issuing Bank" shall be deemed to refer to such successor or to any
previous Issuing Bank, or to such successor and all previous Issuing Banks, as
the context shall require. After the resignation or removal of the Issuing Bank
hereunder, the retiring Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this
Agreement and the other Credit Documents with respect to Letters of Credit
issued by it prior to such resignation or removal, but shall not be required to
issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall
occur and be continuing, the Borrower shall, on the Business Day it receives
notice from the Administrative Agent or the Required Lenders (or, if the
maturity of the Loans has been accelerated, Revolving Credit Lenders holding
participations in outstanding Letters of Credit representing greater than 50% of
the aggregate undrawn amount of all outstanding Letters of Credit) thereof and
of the amount to be deposited, deposit in an account with the Collateral Agent,
for the benefit of the Revolving Credit Lenders, an amount in cash equal to the
L/C Exposure as of such date. Such deposits shall be held by the Collateral
Agent as collateral for the payment and performance of the Obligations. The
Collateral Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Such deposits shall be
invested in Permitted Investments, to be selected by the Issuing Bank in its
sole discretion, and interest earned on such deposits shall be deposited in such
account as additional collateral for the payment and performance of the
Obligations. Interest or profits, if any, on such investments shall accumulate
in such account. Moneys in such account shall (i) automatically be applied by
the Administrative
58
Exhibit 10.1
Agent to reimburse the Issuing Bank for L/C Disbursements for which it has not
been reimbursed, (ii) be held for the satisfaction of the reimbursement
obligations of the Borrower for the L/C Exposure at such time and (iii) if the
maturity of the Loans has been accelerated (but subject to the consent of
Revolving Credit Lenders holding participations in outstanding Letters of Credit
representing greater than 50% of the aggregate undrawn amount of all outstanding
Letters of Credit), be applied to satisfy the Obligations. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.
(k) Additional Issuing Banks. The Borrower may, at any time
and from time to time with the consent of the Administrative Agent (which
consent shall not be unreasonably withheld) and such Lender, designate one or
more additional Lenders to act as an issuing bank under the terms of the
Agreement. Any Lender designated as an issuing bank pursuant to this clause
shall be deemed to be an "Issuing Bank" (in addition to being a Lender) in
respect of Letters of Credit issued or to be issued by such Lender, and, with
respect to such Letters of Credit, such term shall thereafter apply to the other
Issuing Bank and such Lender.
ARTICLE III
Representations and Warranties
Each of Holding and the Borrower represents and warrants to
the Administrative Agent, the Collateral Agent, the Issuing Bank and each of the
Lenders that:
SECTION 3.01. Organization; Powers. Each of Holding, the
Borrower and each of the Subsidiaries (a) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) has all requisite power and authority to own its property and
assets and to carry on its business as now conducted and as proposed to be
conducted, (c) is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required, except where the failure so
to qualify could not reasonably be expected to result in a Material Adverse
Effect, and (d) has the corporate power and authority to execute, deliver and
perform its obligations under each of the Credit Documents and each other
agreement or instrument contemplated hereby to which it is or will be a party
and, in the case of the Borrower, to borrow hereunder.
SECTION 3.02. Authorization. The execution, delivery and
performance by each Credit Party of each of the Credit Documents and the
borrowings hereunder (collectively, the "Transactions") and the Recapitalization
(a) have been duly authorized by all requisite corporate and, if required,
stockholder action and (b) will not (i) violate (A) any provision of law,
statute, rule or regulation, or of the certificate or articles of incorporation
or other constitutive documents or by-laws of Holding, the Borrower or any
Subsidiary other than any violation which will not have a Material Adverse
Effect or the effect (if any) of Chapter 5 of the California Corporations Code,
(B) any order of any Governmental Authority or (C) any provision of any
indenture, agreement or other instrument to which Holding, the Borrower or any
Subsidiary is a party or by which any of them or any of their property is or may
be bound, (ii) be in conflict with, result in a breach of or constitute (alone
or with notice or lapse of time or both) a default under, or give rise
59
Exhibit 10.1
to any right to accelerate or to require the prepayment, repurchase or
redemption of any obligation under any such indenture, agreement or other
instrument or (iii) result in the creation or imposition of any Lien upon or
with respect to any property or assets now owned or hereafter acquired by
Holding, the Borrower or any Subsidiary (other than any Lien created hereunder
or under the Security Documents).
SECTION 3.03. Enforceability. This Agreement has been duly
executed and delivered by Holding and the Borrower and constitutes, and each
other Credit Document when executed and delivered by the each Credit Party
thereto will constitute, a legal, valid and binding obligation of such Credit
Party enforceable against such Credit Party in accordance with its terms.
SECTION 3.04. Governmental Approvals and Licenses. No action,
consent or approval of, registration or filing with or any other action by any
Governmental Authority is or will be required in connection with the
Transactions and the Recapitalization, except for (a) the filing of Uniform
Commercial Code financing statements and filings with the United States Patent
and Trademark Office and the United States Copyright Office, (b) recordation of
the Mortgages and (c) such as have been made or obtained and are in full force
and effect. The Borrower and its Subsidiaries have all licenses, permits,
approvals, qualifications, consents, certificates of needs and accreditations
(where such are required) and other authorizations necessary for the lawful
conduct of their respective businesses or operations wherever now conducted and
as planned to be conducted, pursuant to all applicable statutes, laws,
ordinances, rules and regulations of all Governmental Authorities having,
asserting or claiming jurisdiction over the Borrower and its Subsidiaries on a
consolidated basis, except where such failure would not have a Material Adverse
Effect. Copies of all such licenses, permits, approvals, qualifications,
consents and other authorizations shall be provided to the Administrative Agent
upon request. The Borrower and its Subsidiaries are not in default under any of
such licenses, permits, approvals, consents, qualifications or authorizations
and no event has occurred, and no condition exists, which, with the giving of
notice, the passage of time, or both, would constitute a default thereunder or
would result in the suspension, revocation, impairment, forfeiture or
non-renewal of any such permit, license, authorization or accreditation, except
where such failure would not have a Material Adverse Effect. The continuation,
validity and effectiveness of all such licenses, permits, approvals, consents,
qualifications and authorizations will in no way be adversely affected by the
transactions contemplated by this Agreement, except where such a failure of
continuation, validly or effectiveness would not have a Material Adverse Effect.
The Borrower and its Subsidiaries know of no reason why they will not be able to
maintain after the Closing Date all licenses, permits, approvals, consents,
qualifications, accreditations and other authorizations necessary or appropriate
to own and operate their respective current businesses and to obtain such
licenses, permits, approvals, consents, qualifications and other authorizations
necessary to own and operate their respective current businesses, and otherwise
conduct the business of the Borrower and its Subsidiaries as now conducted and
presently proposed to be conducted.
SECTION 3.05. Financial Statements.
(a) The Borrower has heretofore furnished to the Lenders its
consolidated and consolidating balance sheets and statements of income and
changes in financial condition as of and for the fiscal year ended December 26,
1997, audited by and accompanied by the opinion of Xxxxxx Xxxxxxxx LLP,
independent public accountants. Such financial statements present fairly the
financial condition and results of operations and cash flows of the Borrower and
its
60
Exhibit 10.1
consolidated Subsidiaries as of such dates and for such periods. Such balance
sheets and the notes thereto disclose all material liabilities, direct or
contingent, of the Borrower and its consolidated Subsidiaries as of the dates
thereof. Such financial statements were prepared in accordance with GAAP applied
on a consistent basis.
(b) The Borrower has heretofore delivered to the Lenders its
unaudited pro forma consolidated balance sheet as of December 26, 1997 and
monthly operating statements for January and February 1998, prepared giving
effect to the Recapitalization as if it had occurred on such date. Such pro
forma balance sheet and monthly operating statements has been prepared in good
faith by the Borrower, based on the assumptions used to prepare the pro forma
financial information contained in the Confidential Information Memorandum
(which assumptions are believed by the Borrower on the Closing Date to be
reasonable), is based on the best information available to the Borrower as of
the date of delivery thereof, accurately reflects all adjustments required to be
made to give effect to the Recapitalization and presents fairly on a pro forma
basis the estimated consolidated financial position of the Borrower and its
consolidated Subsidiaries as of such date, assuming that the Recapitalization
had actually occurred at such date.
SECTION 3.06. No Material Adverse Change. There has been no
material adverse change in the business, assets, operations, prospects,
condition, financial or otherwise, or material agreements of Holding, the
Borrower and the Subsidiaries, taken as a whole, since January 1, 2002.
SECTION 3.07. Title to Properties; Possession Under Leases.
(a) Each of Holding, the Borrower and the Subsidiaries has
good and marketable title to, or valid leasehold interests in, all its material
properties and assets (including all Mortgaged Property), except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties and assets for their
intended purposes. All such material properties and assets of Holding, Borrower
and Borrower's Restricted Subsidiaries are free and clear of Liens, other than
Liens expressly permitted by Section 6.02.
(b) Except as set forth on Schedule 3.07(b), each of Holding,
the Borrower and Borrower's Restricted Subsidiaries has complied in all material
respects with all obligations under all material leases to which it is a party
and all such leases are in full force and effect. Each of Holding, the Borrower
and the Subsidiaries enjoys peaceful and undisturbed possession under all such
material leases, except where failure to have such possession will not have a
Material Adverse Effect.
(c) Except as set forth on Schedule 3.07(c), neither Holding
nor the Borrower has received any written notice of, nor has any knowledge of,
any pending or contemplated condemnation proceeding affecting the Mortgaged
Properties or any sale or disposition thereof in lieu of condemnation.
(d) None of Holding, the Borrower or any of the Subsidiaries
is obligated under any right of first refusal, option or other contractual right
to sell, assign or otherwise dispose of any Mortgaged Property or any interest
therein.
61
Exhibit 10.1
SECTION 3.08. Subsidiaries. Schedule 3.08 sets forth as of the
Effective Date a list of all Subsidiaries and the percentage ownership interest
of Holding or the Borrower therein. The shares of capital stock or other
ownership interests so indicated on Schedule 3.08 are fully paid and
non-assessable and are owned by Holding or the Borrower, directly or indirectly,
free and clear of all Liens.
SECTION 3.09. Litigation; Compliance with Laws.
(a) Except as set forth on Schedule 3.09, there are not any
actions, suits or proceedings at law or in equity or by or before any
Governmental Authority now pending or, to the knowledge of Holding or the
Borrower, threatened against or affecting Holding or the Borrower or any
Subsidiary or any business, property or rights of any such person (i) that
involve any Credit Document, the Transactions or the Recapitalization, or that
purport to affect the ability of the parties to consummate the Transactions or
the Recapitalization, or (ii) as to which there is a reasonable possibility of
an adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.
(b) None of Holding, the Borrower or any of the Subsidiaries
or any of their respective material properties or assets is in violation of, nor
will the continued operation of their material properties and assets as
currently conducted violate, any law, rule or regulation (including any zoning,
building, Environmental Law, ordinance, code or approval or any building
permits) or any restrictions of record or agreements affecting the Mortgaged
Property, or is in default with respect to any judgment, writ, injunction,
decree or order of any Governmental Authority, where such violation or default
could reasonably be expected to result in a Material Adverse Effect.
SECTION 3.10. Default in Material Agreements. Other than as
set forth in Schedule 3.10, none of Holding, the Borrower or any of the
Subsidiaries is in default in any manner under any provision of any indenture or
other agreement or instrument evidencing Indebtedness, or any other material
agreement or instrument to which it is a party or by which it or any of its
properties or assets are or may be bound, where such default could reasonably be
expected to result in a Material Adverse Effect.
SECTION 3.11. Federal Reserve Regulations.
(a) None of Holding, the Borrower or any of the Subsidiaries
is engaged principally, or as one of its important activities, in the business
of extending credit for the purpose of buying or carrying Margin Stock.
(b) No part of the proceeds of any Loan or any Letter of
Credit will be used, whether directly or indirectly, and whether immediately,
incidentally or ultimately, for any purpose that entails a violation of, or that
is inconsistent with, the provisions of the Regulations of the Board, including
Regulation T, U or X.
SECTION 3.12. Investment Company Act; Public Utility Holding
Company Act. None of Holding, the Borrower or any Subsidiary is (a) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
62
Exhibit 10.1
SECTION 3.13. Use of Proceeds.
(a) The proceeds of the Term Loans shall be used solely to pay
a portion of the Redemption Amount in connection with the Recapitalization, to
repay the Indebtedness to be Paid, and pay a portion of the Transaction Costs.
(b) The proceeds of the Revolving Loans may be used for
working capital and general corporate purposes of the Borrower (including
Permitted Acquisitions); provided, however, that (i) no more than $0 of
Revolving Loans may be borrowed on the Closing Date, and (ii) the proceeds of
any Revolving Loan made pursuant to Section 2.22(e) shall be applied only to
repay Swingline Loans.
(c) The proceeds of the Swingline Loans may be used for
working capital and general corporate purposes of the Borrower; provided,
however, that no Swingline Loans may be borrowed on the Closing Date.
(d) The Letters of Credit may be used for general corporate
purposes.
(e) Notwithstanding anything in this Agreement to the
contrary, but subject to Section 2.01(b) on and after the Fifth Amendment
Effective Date, (1) not more than $40,000,000 of the Aggregate Revolving Credit
Exposure outstanding at any time shall have been used by the Borrower for
purposes of Permitted Acquisitions pursuant to Section 6.04(c) (the "Acquisition
Loans"), (2) not more than $15,000,000 of the Aggregate Revolving Credit
Exposure outstanding at any time may be used by the Borrower for any corporate
purpose other than Permitted Acquisitions (the "Working Capital Loans"), and (3)
no further Acquisition Loans will be made to the Borrower.
SECTION 3.14. Tax Returns. Each of Holding, the Borrower and
the Subsidiaries has filed or caused to be filed all Federal, state, local and
foreign tax returns or materials required to have been filed by it and has paid
or caused to be paid all taxes due and payable by it and all assessments
received by it, except taxes that are being contested in good faith by
appropriate proceedings and for which Holding, the Borrower or such Subsidiary,
as applicable, shall have set aside on its books adequate reserves in accordance
with GAAP.
SECTION 3.15. No Material Misstatements. None of (a) the
Confidential Information Memorandum or (b) any other information, report,
financial statement, exhibit or schedule furnished by or on behalf of Holding or
the Borrower to the Administrative Agent or any Lender in connection with the
negotiation of any Credit Document or included therein or delivered pursuant
thereto contained, contains or will contain any material misstatement of fact or
omitted, omits or will omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were, are
or will be made, not misleading; provided that to the extent any such
information, report, financial statement, exhibit or schedule was based upon or
constitutes a forecast or projection, each of Holding and the Borrower
represents only that it acted in good faith and utilized reasonable assumptions
and due care in the preparation of such information, report, financial
statement, exhibit or schedule.
SECTION 3.16. Employee Benefit Plans. Each of the Borrower and
its ERISA Affiliates is in compliance in all material respects with the
applicable provisions of ERISA and the Code and the regulations and published
interpretations thereunder. No ERISA Event has occurred
63
Exhibit 10.1
or is reasonably expected to occur that, when taken together with all other such
ERISA Events, could reasonably be expected to result in material liability of
the Borrower or any of its ERISA Affiliates. The present value of all benefit
liabilities under each Plan (based on those assumptions used to fund such Plan)
did not, as of the last annual valuation date applicable thereto, exceed by more
than $1,000,000 the fair market value of the assets of such Plan, and the
present value of all benefit liabilities of all underfunded Plans (based on
those assumptions used to fund each such Plan) did not, as of the last annual
valuation dates applicable thereto, exceed by more than $1,000,000 the fair
market value of the assets of all such underfunded Plans.
SECTION 3.17. Environmental Matters. Except as set forth in
Schedule 3.17:
(a) The real properties owned or operated by Holding, the
Borrower and the Subsidiaries (the "Environmental Properties") do not contain
any Hazardous Materials in amounts or concentrations which (i) constitute, or
constituted a violation of, (ii) require Remedial Action under, or (iii) could
give rise to liability under, Environmental Laws, which violations, Remedial
Actions and liabilities, in the aggregate, could reasonably be expected to
result in a Material Adverse Effect;
(b) The Environmental Properties and all operations of the
Borrower and the Subsidiaries are in compliance, and in the last five years have
been in compliance, with all Environmental Laws and all necessary Environmental
Permits have been obtained and are in effect, except to the extent that such
non-compliance or failure to obtain any necessary permits, in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect;
(c) There have been no Releases or threatened Releases at,
from, under or proximate to the Environmental Properties or otherwise in
connection with the operations of the Borrower or the Subsidiaries, which
Releases or threatened Releases, in the aggregate, could reasonably be expected
to result in a Material Adverse Effect;
(d) None of Holding, the Borrower or any of the Subsidiaries
has received any Environmental Claim in connection with the Environmental
Properties or the operations of the Borrower or the Subsidiaries or with regard
to any person whose liabilities for environmental matters Holding, the Borrower
or the Subsidiaries has retained or assumed, in whole or in part, contractually,
by operation of law or otherwise, which, in the aggregate, could reasonably be
expected to result in a Material Adverse Effect, nor do Holding, the Borrower or
the Subsidiaries have reason to believe that any such notice will be received or
is being threatened; and
(e) Hazardous Materials have not been transported from the
Environmental Properties, nor have Hazardous Materials been generated, treated,
stored or disposed of at, on or under any of the Environmental Properties in a
manner that could give rise to liability under any Environmental Law, nor have
the Borrower or the Subsidiaries retained or assumed any liability,
contractually, by operation of law or otherwise, with respect to the generation,
treatment, storage or disposal of Hazardous Materials, which transportation,
generation, treatment, storage or disposal, or retained or assumed liabilities,
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.18. Insurance. Schedule 3.18 sets forth a true,
complete and correct description of all insurance maintained by the Borrower or
by the Borrower for its Restricted
64
Exhibit 10.1
Subsidiaries as of the Effective Date. As of each such date, such insurance is
in full force and effect and all premiums have been duly paid. The Borrower and
its Subsidiaries have insurance in such amounts and covering such risks and
liabilities as are in accordance with normal industry practice.
SECTION 3.19. Security Documents.
(a) The Pledge Agreement is effective to create in favor of
the Collateral Agent, for the ratable benefit of the Secured Parties, a legal,
valid and enforceable security interest in the Collateral (as defined in the
Pledge Agreement) and, when the Collateral is delivered to the Collateral Agent,
the Pledge Agreement shall constitute a fully perfected first priority Lien on,
and security interest in, all right, title and interest of the pledgors
thereunder in such Collateral, in each case prior and superior in right to any
other person.
(b) The Security Agreement and the other Security Documents
(other than the Pledge Agreement and the Mortgages) are effective to create in
favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a
legal, valid and enforceable security interest in the Collateral (as defined in
the Security Agreement and the other Security Documents (other than the Pledge
Agreement and the Mortgages)) and, when financing statements in appropriate form
are filed in the offices specified on Schedule 6 to the Perfection Certificate,
the Security Agreement and the other Security Documents (other than the Pledge
Agreement and the Mortgages) shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the grantors thereunder
in such Collateral (other than the Intellectual Property, as defined in the
Security Agreement), in each case to the extent such security interests can be
so perfected by such filings, and prior and superior in right to any other
person, other than with respect to Liens expressly permitted by Section 6.02.
(c) When the Security Agreement is filed in the United States
Patent and Trademark Office and the United States Copyright Office, the Security
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the grantors thereunder in the Intellectual
Property (as defined in the Security Agreement), in each case to the extent such
security interests can be so perfected by such filings, and prior and superior
in right to any other person (it being understood that subsequent recordings in
the United States Patent and Trademark Office and the United States Copyright
Office may be necessary to perfect a lien on registered trademarks, trademark
applications and copyrights acquired by the grantors after the Closing Date).
(d) The Mortgages are effective to create in favor of the
Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid
and enforceable Lien on all of the Credit Parties' right, title and interest in
and to the Mortgaged Property thereunder and the proceeds thereof, and when the
Mortgages are filed in the offices specified on Schedule 3.19(d), the Mortgages
shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Credit Parties in such Mortgaged Property and the
proceeds thereof, in each case prior and superior in right to any other person,
other than with respect to the rights of persons pursuant to Liens expressly
permitted by Section 6.02.
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Exhibit 10.1
SECTION 3.20. Location of Real Property and Leased Premises.
(a) Schedule 3.20(a) lists completely and correctly as of the
Effective Date all real property owned by the Borrower and the Restricted
Subsidiaries and the addresses thereof. The Borrower and the Restricted
Subsidiaries own in fee all the real property set forth on Schedule 3.20(a).
(b) Schedule 3.20(b) lists completely and correctly as of the
Effective Date all real property leased by the Borrower and the Restricted
Subsidiaries and the addresses thereof. The Borrower and the Restricted
Subsidiaries have valid leases in all the real property set forth on Schedule
3.20(b).
SECTION 3.21. Labor Matters. As of the Effective Date, there
are no strikes, lockouts or slowdowns against Holding, the Borrower or any
Subsidiary pending or, to the knowledge of Holding or the Borrower, threatened.
The hours worked by and payments made to employees of Holding, the Borrower and
the Subsidiaries have not been in violation of the Fair Labor Standards Act or
any other applicable Federal, state, local or foreign law dealing with such
matters except where such a violation would not have a Material Adverse Effect.
All payments due from Holding, the Borrower or any Subsidiary, or for which any
claim may be made against Holding, the Borrower or any Subsidiary, on account of
wages and employee health and welfare insurance and other benefits, have been
paid or accrued as a liability on the books of Holding, the Borrower or such
Subsidiary. The consummation of the Transactions and the Recapitalization will
not give rise to any right of termination or right of renegotiation on the part
of any union under any collective bargaining agreement to which Holding, the
Borrower or any Subsidiary is bound.
SECTION 3.22. Solvency. Immediately after the consummation of
the Transactions to occur on the Effective Date, (i) the fair value of the
assets of each Credit Party, at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (ii) the present fair
saleable value of the property of each Credit Party will be greater than the
amount that will be required to pay the probable liability of its debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (iii) each Credit Party will be
able to pay its debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (iv) each Credit
Party will not have unreasonably small capital with which to conduct the
business in which it is engaged as such business is now conducted and is
proposed to be conducted following the Effective Date.
ARTICLE IV
Conditions of Lending
The obligations of the Lenders to make Loans (other than a
Borrowing pursuant to Section 2.2(e)) and of the Issuing Bank to issue Letters
of Credit hereunder are subject to the satisfaction of the following conditions
(it being understood for purposes of this Section that making a Loan or
Borrowing does not include a change or continuation of the Type of, or a
duration of the Interest Period applicable to, a previously outstanding
Borrowing pursuant to Section 2.10):
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Exhibit 10.1
SECTION 4.01. All Credit Events. On the date of each Borrowing (other
than a Borrowing pursuant to Section 2.02(e)), including each Borrowing of a
Swingline Loan and on the date of each issuance of a Letter of Credit (each such
event being called a "Credit Event"):
(a) Borrowing Request. The Administrative Agent shall have received a
notice of such Borrowing as required by Section 2.03 or, in the case of the
issuance of a Letter of Credit, the Issuing Bank and the Administrative Agent
shall have received a notice requesting the issuance of such Letter of Credit as
required by Section 2.23(b) or, in the case of the Borrowing of a Swingline
Loan, the Swingline Lender and the Administrative Agent shall have received a
notice requesting such Swingline Loan as required by Section 2.22(b).
(b) Representations and Warranties. Except in the case of a Borrowing
that does not increase the aggregate principal amount of Loans outstanding of
any Lender, the representations and warranties set forth in Article III hereof
shall be true and correct in all material respects on and as of the date of such
Credit Event with the same effect as though made on and as of such date, except
to the extent such representations and warranties expressly relate to an earlier
date.
(c) No Default. The Borrower and each other Credit Party shall be in
compliance with all the terms and provisions set forth herein and in each other
Credit Document on its part to be observed or performed, and at the time of and
immediately after such Credit Event, no Event of Default or Default shall have
occurred and be continuing.
(d) No Cash Hoarding. The sum of cash constituting collected and
available balances in deposit accounts and Permitted Investments of Borrower and
its Restricted Subsidiaries minus any amount being held to pay interest on the
Senior Subordinated Notes and/or to make principal and/or interest payments on
the Loans within three Business Days does not exceed $5,000,000 or such larger
amount as may be approved in writing by Administrative Agent.
Each Credit Event shall be deemed to constitute a representation and warranty by
the Borrower and Holding on the date of such Credit Event as to the matters
specified in clauses (b) (except as aforesaid), (c) and (d) of this Section.
SECTION 4.02. Conditions Precedent to Effective Date. On the
Effective Date:
(a) Purchase and Exchange of Term Notes. Xxxxxxx Xxxxxx or its
Affiliates shall have purchased from Lenders on a pro rata basis not less than
$12,000,000 in Term Loans (the "Purchased Term Loans"), which Purchased Term
Loans shall be immediately exchanged by Xxxxxxx Xxxxxx or such Affiliates for an
equivalent principal amount of Borrower's unsecured Senior Notes, in each case
in accordance with the terms of the Master Assignment and Exchange Agreement.
Upon exchange of the Purchased Term Loans for Senior Notes, the holders of such
Purchased Term Loans and/or Senior Notes shall have no rights with respect to
this Agreement or any other Loan Documents, any Loans or Revolving Credit
Commitments outstanding hereunder.
(b) Loan to HRC Holding. Xxxxxxx Xxxxxx or its Affiliates shall have
purchased for cash not less than $8,000,000 in aggregate principal amount of HRC
Holding Senior Notes.
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Exhibit 10.1
(c) Purchase of Intercompany Receivable. HRC Holding shall have
purchased from Borrower for cash not less than $8,000,000 in an Intercompany
Receivable due to Borrower from Xxxxxx Euro Co S.a.r.l and its Subsidiaries.
(d) Financial Statements. Borrower shall have delivered to Lenders
drafts of the financial statements required to be delivered pursuant to Section
5.04(a) and the related certificates required to be delivered pursuant to
Sections 5.04(d) and (e) with respect to Borrower's fiscal year ending on or
about December 28, 2001, which draft financial statements shall be in form and
substance satisfactory to Administrative Agent.
(e) Opinions. The Administrative Agent shall have received, on behalf
of itself, the Lenders and the Issuing Bank, a favorable written opinion of
Xxxxxxx & XxXxxxxx, special California counsel for Holding and the Borrower,
substantially to the effect set forth in Exhibit P (A) dated the Effective Date,
(B) addressed to the Administrative Agent, the Issuing Bank, the Collateral
Agent and the Lenders, and (C) covering such other matters relating to the
Credit Documents and the Transactions as the Administrative Agent shall
reasonably request, and each of Holding and the Borrower hereby requests such
counsel to deliver such opinions.
(f) Legal Matters. All legal matters incident to this Agreement, the
Borrowings and extensions of credit hereunder and the other Credit Documents
shall be satisfactory to the Lenders, to the Issuing Bank and to O'Melveny &
Xxxxx, counsel for the Administrative Agent.
(g) Organizational Documents. The Administrative Agent shall have
received (i) a copy of the certificate or articles of incorporation, including
all amendments thereto, of each Credit Party, certified as of a recent date by
the Secretary of State of the state of its organization, and a certificate as to
the good standing of each Credit Party as of a recent date, from such Secretary
of State; (ii) a certificate of the Secretary or Assistant Secretary of each
Credit Party dated the Effective Date and certifying (A) that attached thereto
is a true and complete copy of the by-laws of such Credit Party as in effect on
the Effective Date and at all times since a date prior to the date of the
resolutions described in clause (B), (B) that attached thereto is a true and
complete copy of resolutions duly adopted by the Board of Directors of such
Credit Party authorizing the execution, delivery and performance of the Credit
Documents to which such person is a party and, in the case of the Borrower, the
borrowings hereunder, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the certificate
or articles of incorporation of such Credit Party have not been amended since
the date of the last amendment thereto shown on the certificate of good standing
furnished pursuant to clause (i), and (D) as to the incumbency and specimen
signature of each officer executing any Credit Document or any other document
delivered in connection herewith on behalf of such Credit Party; (iii) a
certificate of another officer as to the incumbency and specimen signature of
the Secretary or Assistant Secretary executing the certificate pursuant to
clause (ii); and (iv) such other documents as the Lenders, the Issuing Bank or
O'Melveny & Xxxxx, counsel for the Administrative Agent, may reasonably request.
(h) Payment of Fees, Etc. The Administrative Agent shall have
received from the Borrower (i) the aggregate amount of accrued and unpaid
interest at the default rate pursuant to Section 2.07 from and including April
1, 2002, to and excluding the Effective Date, to be payable to each Lender in
accordance with its pro rata share; (ii) an amendment fee equal to 35 basis
points
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Exhibit 10.1
on the aggregate amount, without duplication and after giving effect to the
purchase of the Purchased Term Loans, of the sum of the outstanding Term Loans
plus the Revolving Credit Commitment, to be payable to each Lender in accordance
with its pro rata share; and (iii) all other amounts due and payable on or prior
to the Effective Date, including, to the extent invoiced, reimbursement or
payment of all out-of-pocket expenses required to be reimbursed or paid by the
Borrower hereunder or under any other Credit Document, including without
limitation the fees and expenses of PricewaterhouseCoopers and O'Melveny &
Xxxxx.
(i) Nonrecourse Pledge Agreement. The Nonrecourse Pledge Agreement
shall have been duly executed by the parties thereto and delivered to the
Collateral Agent and shall be in full force and effect, and all the Senior
Notes, HRC Holding Senior Notes and senior promissory notes of Borrower or HRC
Holding outstanding as of the Effective Date and held by Xxxxxxx Xxxxxx or any
Affiliate of Xxxxxxx Xxxxxx shall have been duly and validly pledged thereunder
to the Collateral Agent for the ratable benefit of the Secured Parties and notes
and other instruments or documents representing such investments, accompanied by
instruments of transfer and endorsements in blank, and Uniform Commercial Code
financing statements, shall be in the actual possession of the Collateral Agent.
(j) Security Agreement. The Security Agreement, as amended and
restated on the Effective Date, shall have been duly executed by Holding,
Borrower and the Subsidiary Guarantors, and such Security Agreement shall have
been delivered to the Collateral Agent and shall be in full force and effect on
such date and each document (including each Uniform Commercial Code financing
statement) required by law or reasonably requested by the Administrative Agent
to be filed, registered or recorded in order to create in favor of the
Collateral Agent for the benefit of the Secured Parties a valid, legal and
perfected first-priority security interest in and lien on the Collateral
(subject to any Lien expressly permitted by Section 6.02) described in such
agreement shall have been delivered to the Collateral Agent.
(k) Interest Payment on Senior Subordinated Notes. After payment of
the amounts payable pursuant to Section 4.02(h) above, Borrower may make a
payment in the approximate amount of $5,300,000 (including default interest) to
the holders of its Senior Subordinated Notes. Any remaining proceeds from the
Intercompany Receivable purchased pursuant to Section 4.02(c) after the payment
of such interest to holders of the Senior Subordinated Notes shall be used to
reduce outstanding Revolving Loans (without any Revolving Loan Commitment
reduction).
(l) Replacement of Missing Certificate. Borrower will re-issue an
Exchangeable Preferred Stock certificate for 20,444 shares of its Exchangeable
Preferred Stock and deliver it to Collateral Agent under the Pledge Agreement
upon receipt of a lost certificate indemnity from Collateral Agent reasonably
satisfactory to Borrower.
SECTION 4.03. Effective Date Matters.
(a) Representations, Warranties, Covenants and Releases. Each of
Holding and Borrower hereby represents and warrants that as of the Effective
Date (i) after giving effect to the transactions contemplated by this Agreement
all of the representations and warranties made or deemed to be made by Holding
and the Borrower under the Credit Documents are true and correct, except with
respect to such representations and warranties which, by their express terms,
are
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Exhibit 10.1
applicable only to an earlier date; (ii) after giving effect to the transactions
contemplated by this Agreement and except as set forth on Schedule 3.10, there
exists no Default or Event of Default under this Agreement or any of the other
Credit Documents (other than any Default or Event of Default under Section
7.01(f) arising solely as a result of the matters disclosed on Schedule 3.10);
(iii) Borrower has the power and is duly authorized to enter into, deliver and
perform this Agreement; (iv) this Agreement and each of the other Credit
Documents is the legal, valid and binding obligation of Holding and Borrower
enforceable against it in accordance with its terms, except as such
enforceability maybe limited by applicable bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally and
by general principles of equity (regardless of whether enforcement is sought in
equity or in law); (v) the execution, delivery and performance of this Agreement
in accordance with its terms do not and will not, with the passage of time, the
giving of notice of otherwise: (A) require any approval of any Governmental
Authority or violate any applicable law relating to Holding and Borrower; (B)
conflict with, result in a breach of or constitute a default under (1) the
articles or certificate of incorporation or bylaws of Holding and Borrower, (2)
any indenture, material agreement or other material instrument to which any of
Holding or Borrower is a party or by which any of their respective properties
may be bound, or (3) any approval of any Governmental Authority relating to any
of Holding or Borrower; or (C) result in or require the creation or imposition
of any Lien upon or with respect to any property now owned or hereafter acquired
by the Holding and Borrower other than Liens permitted hereunder.
Each of Holding and Borrower hereby acknowledges and agrees that, as
of the date hereof, no right of offset, defense, counterclaim, claim, causes of
action or objection in favor of Holding, Borrower or any other Credit Party
against the Lenders or the Administrative Agent or the Collateral Agent exists
arising out of or with respect to (i) the Obligations, this Agreement or any of
the other Credit Documents; (ii) any other documents evidencing, securing or in
any way relating to the foregoing, or (iii) the administration or funding of the
Loans, the Revolving Credit Commitment or the issuance of Letters of Credit.
Each of Holding and Borrower hereby expressly waives, releases and
relinquishes any and all defenses, setoffs, claims, counterclaims, causes of
action or objections, if any, against the Lenders or the Administrative Agent or
the Collateral Agent, whether known or unknown, both at law and in equity, only
to the extent arising out of any matter, cause or event occurring on or prior to
the date hereof.
Each of Holding and Borrower for itself, each other Credit Party and
their respective successors and assigns in interest and any person that may
derivatively or otherwise assert a claim through or by any of the foregoing to
the fullest extent permitted by applicable law (collectively, the "Releasors")
waives and releases against Agents and each Lender and each of their respective
employees, agents, representatives, consultants, attorneys, fiduciaries,
servants, officers, directors, partners, predecessors, successors and assigns,
subsidiary corporations, parent corporations, related corporate divisions,
participants and assigns (collectively, the "Releasees"), and covenants not to
commence or pursue any litigation or action, claims, demands, causes of action,
suits, debts, sums of money, accounts, bonds, bills, covenants, contracts,
controversies, agreements, promises, setoffs, recoupments, counterclaims,
defenses, expenses, damages and/or judgments, whatsoever in law or in equity
(whether matured, unmatured, contingent or non-contingent) that relate in any
way, either directly or indirectly, to this Agreement, any Credit Documents, the
transactions contemplated thereby or any action by Agents, Lenders or any other
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Exhibit 10.1
Releasee in any way related thereto, whether known or unknown, which each of the
Releasors had, now has or may have. Each of the Releasors expressly understands
that Section 1542 of the California Civil Code provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
Each of the Releasors hereby agrees that the provisions of Section
1542 of the California Civil Code and all similar federal or state laws, rights,
rules or legal principles of any other jurisdiction which may be applicable
thereto, to the extent that they apply to the matters released hereby, are
knowingly and voluntarily waived and relinquished by such Releasors, to the full
extent that such rights and benefits pertaining to the matters released herein
may be waived, and each of the Releasors hereby agrees and acknowledges that
this waiver is an essential term of this Agreement, without Agents and Lenders
would not have entered into this Agreement. Each of the Releasors represents and
warrants that it has not purported to transfer, assign, pledge or otherwise
convey any of its right, title or interest in any matter released hereby to any
other person. In connection with the release in this Agreement, each of the
Releasors acknowledges that it is aware it may hereafter discover claims
presently unknown or unsuspected, or facts in addition to or different from
those which such Credit Parties now knows or believes to be true, with respect
to the matters released herein. Nevertheless, it is each of the Releasors'
intent in executing this Agreement to fully, finally and forever release and
settle such matters. In making this release, each of the Releasors has consulted
with counsel concerning the effect thereof, including, without limitation, the
effect of the waiver and Section 1542 of the California Civil Code.
(b) Limited Waiver. Upon the satisfaction of the conditions set forth
in Section 4.02, the undersigned Lenders hereby waive any Defaults or Events of
Default arising from the matters described on Schedule 3.10 or from Borrower's
failure (i) to make the principal payment on the Term Loans due on Xxxxx 00,
0000, (xx) to comply with Sections 5.04(a), (b), (c), (d) and (e) of this
Agreement with respect to the fiscal year ending on or about December 28, 2001
and/or the first fiscal quarter in 2002 and (iii) to be in compliance with the
financial covenants through and including the date on which this Agreement
becomes effective pursuant to Section 4.02 hereof (collectively, the "Existing
Events of Default"). Without limiting the generality of the provisions of the
covenants set forth in this Agreement, the waiver set forth herein shall be
limited precisely as written and relates solely to the noncompliance by the
Borrower with the provisions of the covenants set forth in this Agreement with
respect to the Existing Events of Default in the manner and to the extent
described in this paragraph, and nothing in this paragraph shall be deemed to
(a) constitute a waiver of compliance by Borrower with respect to (i) the
covenants set forth in this Agreement in any other instance or (ii) any other
term, provision or condition of this Agreement or any other instrument or
agreement referred to therein or (b) prejudice any right or remedy that the
Administrative Agent, the Collateral Agent or any Lender may now have (except to
the extent such right or remedy was based upon existing defaults that will not
exist after giving effect to this waiver) or may have in the future under or in
connection with the Agreement or any other instrument or agreement referred to
therein.
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Exhibit 10.1
(c) Lender Representations. Each Lender hereby acknowledges that
other than the Existing Events of Default, such Lender does not have actual
knowledge, as of the Effective Date, of any Default or Event of Default existing
under this Agreement.
ARTICLE V
Affirmative Covenants
SECTION 5.01. Existence; Businesses and Properties.
(a) Holding and the Borrower shall, and the Borrower shall cause each
Restricted Subsidiary to, do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence, except as
otherwise expressly permitted under Section 6.04.
(b) Holding and the Borrower shall, and the Borrower shall cause each
Restricted Subsidiary to, do or cause to be done all things necessary to obtain,
preserve, renew, extend and keep in full force and effect the rights, licenses,
permits, franchises, authorizations, patents, copyrights, trademarks and trade
names material to the conduct of its business; comply in all material respects
with all applicable laws, rules, regulations (including any zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Mortgaged Properties) and
decrees and orders of any Governmental Authority, whether now in effect or
hereafter enacted, except where the failure to do so will not have a Material
Adverse Effect; and at all times maintain and preserve all property material to
the conduct of such business and keep such property in good repair, working
order and condition and from time to time make renewals, additions, improvements
and replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times.
SECTION 5.02. Insurance. The Borrower shall, and shall cause each
Restricted Subsidiary to,
(a) keep its insurable properties adequately insured at all times by
financially sound and reputable insurers; maintain such other insurance, to such
extent and against such risks, including fire and other risks insured against by
extended coverage, as is customary with companies in the same or similar
businesses operating in the same or similar locations, including public
liability insurance against claims for personal injury or death or property
damage occurring upon, in, about or in connection with the use of any properties
owned, occupied or controlled by it; and maintain such other insurance as may be
required by law.
(b) cause all such policies to be endorsed or otherwise amended to
include a "standard" or "New York" lender's loss payable endorsement, in form
and substance satisfactory to the Administrative Agent and the Collateral Agent,
which endorsement shall provide that, from and after the Closing Date, if the
insurance carrier shall have received written notice from the Administrative
Agent or the Collateral Agent of the occurrence of an Event of Default, the
insurance carrier shall pay all proceeds otherwise payable to the Borrower or
the Credit Parties under such policies directly to the Collateral Agent; cause
all such policies to provide that neither the Borrower, the Administrative
Agent, the Collateral Agent nor any other party shall be a
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Exhibit 10.1
coinsurer thereunder and to contain a "Replacement Cost Endorsement", without
any deduction for depreciation, and such other provisions as the Administrative
Agent or the Collateral Agent may reasonably require from time to time to
protect their interests; deliver original or certified copies of all such
policies to the Collateral Agent; cause each such policy to provide that it
shall not be cancelled, modified or not renewed (i) by reason of nonpayment of
premium upon not less than 10 days' prior written notice thereof by the insurer
to the Administrative Agent and the Collateral Agent (giving the Administrative
Agent and the Collateral Agent the right to cure defaults in the payment of
premiums) or (ii) for any other reason upon not less than 30 days' prior written
notice thereof by the insurer to the Administrative Agent and the Collateral
Agent; deliver to the Administrative Agent and the Collateral Agent, prior to
the cancellation, modification or nonrenewal of any such policy of insurance, a
copy of a renewal or replacement policy (or other evidence of renewal of a
policy previously delivered to the Administrative Agent and the Collateral
Agent) together with evidence satisfactory to the Administrative Agent and the
Collateral Agent of payment of the premium therefor.
(c) if at any time the area in which the Premises (as defined in the
Mortgages) are located is designated (i) a "flood hazard area" in any Flood
Insurance Rate Map published by the Federal Emergency Management Agency (or any
successor agency), obtain flood insurance in such total amount as the Collateral
Agent or the Required Lenders may from time to time require, and otherwise
comply with the National Flood Insurance Program as set forth in the Flood
Disaster Protection Act of 1973, as it may be amended from time to time, or (ii)
a "Zone 1" area, obtain earthquake insurance in such total amount as the
Administrative Agent, the Collateral Agent or the Required Lenders may from time
to time require.
(d) with respect to any Mortgaged Property, carry and maintain
comprehensive general liability insurance including the "broad form CGL
endorsement" and coverage on an occurrence basis against claims made for
personal injury (including bodily injury, death and property damage) and
umbrella liability insurance against any and all claims, in no event for a
combined single limit of less than $10,000,000, naming the Collateral Agent as
an additional insured, on forms satisfactory to the Collateral Agent.
(e) notify the Administrative Agent and the Collateral Agent
immediately whenever any separate insurance concurrent in form or contributing
in the event of loss with that required to be maintained under this Section is
taken out by the Borrower; and promptly deliver to the Administrative Agent and
the Collateral Agent a duplicate original copy of such policy or policies.
(f) in connection with the covenants set forth in this Section, it is
understood and agreed that:
(i) none of the Administrative Agent, the Lenders, the Issuing Bank, or
their respective agents or employees shall be liable for any loss or damage
insured by the insurance policies required to be maintained under this
Section, it being understood that (A) the Borrower and the other Credit
Parties shall look solely to their insurance companies or any other parties
other than the aforesaid parties for the recovery of such loss or damage
and (B) such insurance companies shall have no rights of subrogation
against the Administrative Agent, the Collateral Agent, the Lenders, the
Issuing Bank or their agents or employees. If, however, the insurance
policies do not provide waiver of
73
Exhibit 10.1
subrogation rights against such parties, as required above, then the
Borrower hereby agrees, to the extent permitted by law, to waive its
right of recovery, if any, against the Administrative Agent, the
Collateral Agent, the Lenders, the Issuing Bank and their agents and
employees; and
(ii) the designation of any form, type or amount of insurance
coverage by the Administrative Agent, the Collateral Agent or the
Required Lenders under this Section shall in no event be deemed a
representation, warranty or advice by the Administrative Agent, the
Collateral Agent or the Lenders that such insurance is adequate for
the purposes of the business of the Borrower and the Subsidiaries or
the protection of their properties and the Administrative Agent, the
Collateral Agent and the Required Lenders shall have the right from
time to time to require the Borrower and the other Credit Parties to
keep other insurance in such form and amount as the Administrative
Agent, the Collateral Agent or the Required Lenders may reasonably
request, provided that such insurance shall be obtainable on
commercially reasonable terms.
SECTION 5.03. Payment of Taxes. Holding and the Borrower shall, and
the Borrower shall cause each Restricted Subsidiary to, pay and discharge
promptly when due all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its property,
before the same shall become delinquent or in default, that, if unpaid, might
give rise to a Lien upon such properties or any part thereof; provided, however,
that such payment and discharge shall not be required with respect to any such
tax, assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and the Borrower
shall have set aside on its books adequate reserves with respect thereto in
accordance with GAAP and such contest operates to suspend collection of the
contested obligation, tax, assessment or charge and enforcement of a Lien and,
in the case of a Mortgaged Property, there is no risk of forfeiture of such
property.
SECTION 5.04. Financial Statements, Reports, etc. The Borrower
shall furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year, its
consolidated and consolidating balance sheets and related statements of
operations, stockholders' equity and cash flows showing the financial condition
of Holding and the Borrower and its consolidated Restricted Subsidiaries as of
the close of such fiscal year and the results of its operations and the
operations of such Restricted Subsidiaries during such year, all audited by
Deloitte & Touche LLP or other independent public accountants of recognized
national standing and accompanied by (i) an opinion of such accountants (which
shall not be qualified in any material respect) to the effect that such
consolidated financial statements fairly present the financial condition and
results of operations of Holding and the Borrower and its consolidated
Restricted Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, and (ii) any management letter issued by such accountants
to the board of directors or finance committee of Holding or the Borrower;
provided that Borrower's financial statements and other documents required by
this Section 5.04(a) with respect to its fiscal year ended on or about December
28, 2001, shall be delivered within 45 days of the Effective Date and such
financial statements shall be substantially the same as the draft financial
statements approved by Administrative Agent on the Effective Date;
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Exhibit 10.1
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year, its consolidated and consolidating balance sheets
and related statements of operations, stockholders' equity and cash flows
showing the financial condition of the Borrower and its consolidated Restricted
Subsidiaries as of the close of such fiscal quarter and the results of its
operations and the operations of such Restricted Subsidiaries during such fiscal
quarter and the then elapsed portion of the fiscal year, all certified by one of
its Financial Officers as fairly presenting the financial condition and results
of operations of the Borrower and its consolidated Restricted Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to the
absence of footnotes and normal year-end audit adjustments; and the Intercompany
Receivable balance as of the last day of such quarter and a calculation of the
average daily Intercompany Receivable balance for such quarter; provided that
Borrower's financial statements and other documents required by this Section
5.04(b) with respect to its first fiscal quarter in 2002 shall be delivered
concurrently with its financial statements for its fiscal year ended on or about
December 28, 2001;
(c) (i) within 30 days after the end of each of month, its consolidated
balance sheets and related statements of operations, stockholders' equity and
cash flows showing the financial condition of the Borrower and its consolidated
Restricted Subsidiaries as of the close of such month and the results of its
operations and the operations of such Restricted Subsidiaries during such month
and the then elapsed portion of the fiscal year, all certified by one of its
Financial Officers as fairly presenting the financial condition and results of
operations of the Borrower and its consolidated Restricted Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to the
absence of footnotes and normal year-end audit adjustments and a cash flow
forecast, by week (the "Cash Flow Forecast"), for the 13 weeks immediately
succeeding the calendar month in which such forecast is delivered, including all
cash receipts and disbursements, for the Credit Parties on a consolidated basis,
such forecast and any modifications or supplements thereto to be in form and
substance reasonably satisfactory to Administrative Agent; and (ii) on the 15th
day of each month commencing on June 15, 2002, a four/five-week cash flow report
describing the cash flow results for the four/five-week fiscal period most
recently ended and comparing those results to the Cash Flow Forecast for such
four/five-week period, together with a reconciliation of actual cash receipts
and disbursements for the immediately preceding four/five-week fiscal period
against such forecast; and (iii) the Intercompany Receivable balance as of the
last day of such month;
(d) concurrently with any delivery of financial statements under clause
(a), (b) or (c)(i), a certificate of the accounting firm or a Financial Officer
opining on or certifying such statements (which certificate, when furnished by
an accounting firm, may be limited to accounting matters and disclaim
responsibility for legal interpretations) (i) certifying that no Event of
Default or Default has occurred or, if such an Event of Default or Default has
occurred, specifying the nature and extent thereof and any corrective action
taken or proposed to be taken with respect thereto and (ii) setting forth
computations in reasonable detail satisfactory to the Administrative Agent
demonstrating compliance with the covenants contained in Section 3.13(e) and
Sections 6.08, 6.10 and 6.14 and, additionally, calculating Borrower's
Debt/Adjusted EBITDA Ratio for the period then ended;
(e) concurrently with any delivery of financial statements under clause
(a) or (b), a Pricing Adjustment Certificate;
75
Exhibit 10.1
(f) not later than January 31 of each year, (i) copies of the Borrower's
annual consolidated budget for the Borrower and its consolidated Restricted
Subsidiaries for the current fiscal year, in the form presented by management to
the Borrower's Board of Directors; and (ii) copies of the Borrower's
consolidated financial projections for the Borrower and its consolidated
Restricted Subsidiaries for the current fiscal year and the next 3 fiscal years
prepared in a manner consistent with the financial projections delivered to the
Syndication Agent in connection with the closing of this Agreement;
(g) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any Subsidiary with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed to its
shareholders, as the case may be;
(h) (i) within 30 days after the end of each fiscal month of Gibeck AB
(other than the last month of a fiscal quarter) copies of the consolidated
profit and loss statement of Gibeck AB and its consolidated Subsidiaries in the
form in which such statement is required to be delivered any non-Affiliate
lender to Gibeck AB, or if such statement is not required to be delivered to any
such lender, as prepared for internal use by Gibeck AB in a manner consistent
with prior practice; (ii) within 45 days after then end of each fiscal quarter
of Gibeck AB (other than the last quarter of a fiscal year), copies of the
consolidated profit and loss statement, balance sheet and statement of cash
flows of Gibeck AB and its consolidated Subsidiaries, all certified by one of
its Financial Officers as fairly presenting the financial condition and results
of operations of Gibeck AB and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied, subject to the absence of
footnotes and normal year-end audit adjustments; and (iii) within 90 days after
then end of each fiscal year of Gibeck AB, copies of the consolidated profit and
loss statement, balance sheet and statement of cash flows of Gibeck AB and its
consolidated Subsidiaries, all certified by one of its Financial Officers as
fairly presenting the financial condition and results of operations of Gibeck AB
and its consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, subject to the absence of footnotes and normal
year-end audit adjustments; and
(i) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of Holding, the Borrower or
any Subsidiary, or compliance with the terms of any Credit Document, as the
Administrative Agent or any Lender may reasonably request.
SECTION 5.05. Litigation and Other Notices. The Borrower shall, promptly
after a Responsible Officer becomes aware thereof, furnish to the Administrative
Agent, the Issuing Bank and each Lender prompt written notice of the following:
(a) any Event of Default or Default, specifying the nature and extent
thereof and the corrective action (if any) taken or proposed to be taken with
respect thereto;
(b) the filing or commencement of, or any threat or notice of intention
of any person to file or commence, any action, suit or proceeding, whether at
law or in equity or by or before any Governmental Authority, against the
Borrower or any Affiliate thereof that could
76
Exhibit 10.1
reasonably be expected to result in a Material Adverse Effect; and (c) any
development that has resulted in, or could reasonably be expected to result in,
a Material Adverse Effect.
SECTION 5.06. Employee Benefits. Holding and the Borrower shall, and the
Borrower shall cause each Restricted Subsidiary to, (a) comply in all material
respects with the applicable provisions of ERISA and the Code and (b) furnish to
the Administrative Agent (i) as soon as possible after, and in any event within
10 days after any Responsible Officer of the Borrower or any ERISA Affiliate
knows or has reason to know that, any ERISA Event has occurred that, alone or
together with any other ERISA Event could reasonably be expected to result in
liability of the Borrower in an aggregate amount exceeding $1,000,000 or
requiring payments exceeding $500,000 in any year, a statement of a Financial
Officer of the Borrower setting forth details as to such ERISA Event and the
action, if any, that the Borrower proposes to take with respect thereto.
SECTION 5.07. Maintaining Records; Access to Properties and Inspections.
(a) The Borrower shall, and shall cause each Restricted Subsidiary to,
keep proper books of record and account, in a manner consistent with
requirements of law and with sound business practice so as to permit the
preparation of financial statements in conformity with GAAP, and in which full,
true and correct entries are made of all dealings and transactions in relation
to its business and activities.
(b) Each Credit Party will, and will cause each of its Subsidiaries to,
permit any representatives designated by the Administrative Agent or any Lender
to visit and inspect the financial records and the properties of Holding, the
Borrower or any Subsidiary at reasonable times and as often as reasonably
requested and to make extracts from and copies of such financial records, and
permit any representatives designated by the Administrative Agent or any Lender
to discuss the affairs, finances and condition of Holding, the Borrower or any
Subsidiary with the officers thereof and independent accountants therefor;
provided, however, that (i) so long as no Event of Default has occurred and is
continuing, the Administrative Agent and the Lenders shall be limited to visits
on four occasions per year, and the Administrative Agent shall use it best
efforts to coordinate such visits, and (ii) the Administrative Agent shall give
the Borrower reasonable notice of a proposed discussions with such independent
accountants, and representatives of the Borrower may at the Borrower's option
participate in such discussions.
(c) Following an Event of Default resulting from a failure of the
Borrower to comply with Section 6.08 or 6.10 hereof and upon the request of the
Administrative Agent, each Credit Party will, and will cause its subsidiaries
to, cooperate with an Independent Consultant hired on behalf of the Lenders to
conduct such examinations and inquiries with respect to the business, operations
and prospects of Borrower and its subsidiaries as may be requested by the
Administrative Agent in its discretion, the results of such examinations and
inquiries to be reported to the Lenders; provided that such Independent
Consultant shall be selected by the Borrower from a list of three such
Independent Consultants selected by the Administrative Agent and that all costs
and expenses of such Independent Consultant shall be paid by the Borrower.
SECTION 5.08. Use of Proceeds. The Borrower shall, and shall cause each
Restricted Subsidiary to, use the proceeds of the Loans and request the issuance
of Letters of Credit only for the purposes set forth in Section 3.13.
77
Exhibit 10.1
SECTION 5.09. Compliance with Environmental Laws. The Borrower shall, and
shall cause each Restricted Subsidiary to, comply, and cause all lessees and
other persons occupying its Environmental Properties to comply, in all material
respects with all Environmental Laws and Environmental Permits applicable to its
operations and Environmental Properties; obtain and renew all material
Environmental Permits necessary for its operations and Environmental Properties;
and conduct any Remedial Action in accordance with Environmental Laws, except to
the extent to do the same could not be reasonably be expected to have a Material
Adverse Effect; provided, however, that none of Holding, the Borrower or any of
the Subsidiaries shall be required to undertake any Remedial Action to the
extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect to
such circumstances.
SECTION 5.10. Preparation of Environmental Reports. The Borrower shall, and
shall cause each Restricted Subsidiary to, if a Default caused by reason of a
breach of Section 3.17 or 5.09 shall have occurred and be continuing, at the
request of the Required Lenders through the Administrative Agent, provide to the
Lenders within 45 days after such request, at the expense of the Borrower, an
environmental site assessment report for the Environmental Properties which are
the subject of such default prepared by an environmental consulting firm
acceptable to the Administrative Agent and indicating the presence or absence of
Hazardous Materials and the estimated cost of any compliance or Remedial Action
in connection with such Environmental Properties.
SECTION 5.11. Further Assurances. Holding and the Borrower shall, and the
Borrower shall cause each Restricted Subsidiary to, execute any and all further
documents, financing statements, agreements and instruments, and take all
further action (including filing Uniform Commercial Code and other financing
statements, mortgages and deeds of trust) that may be required under applicable
law, or that the Required Lenders, the Administrative Agent or the Collateral
Agent may reasonably request, in order to effectuate the transactions
contemplated by the Credit Documents and in order to grant, preserve, protect
and perfect the validity and first priority of the security interests created or
intended to be created by the Security Documents. The Borrower will cause any
subsequently acquired or organized Domestic Subsidiary to execute a Subsidiary
Guarantee Agreement, Indemnity Subrogation and Contribution Agreement and each
applicable Security Document in favor of the Collateral Agent. In addition, from
time to time, the Borrower will, at its cost and expense, promptly secure the
Obligations by pledging or creating, or causing to be pledged or created,
perfected security interests with respect to such of its assets and properties
as the Administrative Agent or the Required Lenders shall designate (it being
understood that it is the intent of the parties that the Obligations shall be
secured by, among other things, substantially all the assets of the Borrower
(including real and other properties acquired subsequent to the Closing Date)).
Such security interests and Liens will be created under the Security Documents
and other security agreements, mortgages, deeds of trust and other instruments
and documents in form and substance satisfactory to the Collateral Agent, and
the Borrower shall deliver or cause to be delivered to the Lenders all such
instruments and documents (including legal opinions, title insurance policies
and lien searches) as the Collateral Agent shall reasonably request to evidence
compliance with this Section. The Borrower agrees to provide such evidence as
the Collateral Agent shall reasonably request as to the perfection and priority
status of each such security interest and Lien.
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Exhibit 10.1
SECTION 5.12. Mortgaged Property Casualty and Condemnation.
(a) Notwithstanding any other provision of this Agreement or
the Security Documents, the Collateral Agent is authorized, at its option (for
the benefit of the Secured Parties), to collect and receive, to the extent
payable to the Borrower or any other Credit Party, all insurance proceeds,
damages, claims and rights of action under any insurance policies with respect
to any casualty or other insured damage ("Casualty") to any portion of any
Mortgaged Property (collectively, "Casualty Proceeds"), unless the amount of the
related Casualty Proceeds is less than $1,000,000 and an Event of Default shall
not have occurred and be continuing. The Borrower agrees to notify the
Collateral Agent and the Administrative Agent, in writing, promptly after the
Borrower obtains notice or knowledge of any Casualty to a Mortgaged Property,
which notice shall set forth a description of such Casualty and the Borrower's
good faith estimate of the amount of related damages. The Borrower agrees,
subject to the foregoing limitations, to endorse and transfer or cause to be
endorsed or transferred any Casualty Proceeds received by it or any other Credit
Party to the Collateral Agent.
(b) The Borrower will notify the Collateral Agent and the
Administrative Agent immediately upon obtaining knowledge of the institution of
any action or proceeding for the taking of any Mortgaged Property, or any part
thereof or interest therein, for public or quasi-public use under the power of
eminent domain, by reason of any public improvement or condemnation proceeding,
or in any other manner (a "Condemnation"). No settlement or compromise of any
claim in connection with any such action or proceeding shall be made without the
consent of the Collateral Agent, which consent shall not be unreasonably
withheld. The Collateral Agent is authorized, at its option (for the benefit of
the Secured Parties), to collect and receive all proceeds of any such
Condemnation (in each case, the "Condemnation Proceeds"). The Borrower agrees to
execute or cause to be executed such further assignments of any Condemnation
Proceeds as the Collateral Agent may reasonably require.
(c) In the event of any Condemnation of the Mortgaged
Property, or any part thereof and subject to the provisions of clause (e), the
Collateral Agent shall apply the Condemnation Proceeds first, in the case of a
partial Condemnation, to the repair or restoration of any integrated structure
subject to such Condemnation or, in the case of a total or "substantially all"
Condemnation, to the location of a replacement property, acquisition of such
replacement property and construction of the replacement structures, and second,
shall apply the remainder of such Condemnation Proceeds (less the reasonable
costs, if any, incurred by the Collateral Agent in the recovery of such
Condemnation Proceeds) to prepay obligations outstanding under this Agreement,
with any remaining Condemnation Proceeds being returned to the Borrower.
(d) In the event of any Casualty of less than 50% of the
useable square footage of the improvements of any Mortgaged Property, the
Borrower shall, subject to the conditions contained in clause (e), restore the
Mortgaged Property to substantially its same condition immediately prior to such
Casualty. In the event of any Casualty of greater than 50% of the useable square
footage of the improvements of any Mortgaged Property and so long as no Default
or Event of Default has occurred and is continuing, the Borrower shall have the
option to either:
(i) restore the Mortgaged Property to a condition
substantially similar to its condition immediately prior to such Casualty
and to invest the balance, if any, of any Casualty Proceeds in equipment or
other assets used in the Borrower's principal lines of
79
Exhibit 10.1
business within 6 months after the receipt thereof, provided that the
Borrower, pending such reinvestment, promptly deposits such excess Casualty
Proceeds in a cash collateral account established with the Collateral Agent
for the benefit of the Secured Parties, or
(ii) direct the Collateral Agent to apply the related Casualty
Proceeds to prepay obligations outstanding under this Agreement, with any
remaining Casualty Proceeds being returned to the Borrower.
Any excess Casualty Proceeds that are not reinvested in the Borrower's principal
lines of business as contemplated above will be applied to prepay the
Obligations.
If required to do so, the Borrower shall make the election
contemplated by the immediately preceding clause by notifying the Collateral
Agent and the Administrative Agent promptly after the later to occur of (A) five
days after the Borrower and its insurance carrier reach a final determination of
the amount of any Casualty Proceeds and (B) 30 days after the occurrence of the
Casualty. If the Borrower shall be required or shall elect to restore the
Mortgaged Property, the insufficiency of any Casualty Proceeds or Condemnation
Proceeds to defray the entire expense of such restoration shall in no way
relieve the Borrower of such obligation so to restore. In the event the Borrower
shall be required to restore or shall notify the Collateral Agent and the
Administrative Agent of its election to restore, the Borrower shall diligently
and continuously prosecute the restoration of the Mortgaged Property to
completion. In the event of a Casualty where the Borrower is required to make
the election set forth above and the Borrower shall fail to notify the
Collateral Agent and the Administrative Agent of its election within the period
set forth above or shall elect not to restore the Mortgaged Property, the
Collateral Agent shall (after being reimbursed for all reasonable costs of
recovery of such Casualty Proceeds) apply such Casualty Proceeds to prepay
obligations outstanding under this Agreement. In addition, upon such prepayment,
the Borrower shall be obligated to place the remaining portion, if any, of the
Mortgaged Property in a safe condition that is otherwise in compliance with the
requirements of applicable Governmental Authorities and the provisions of this
Agreement and the applicable Mortgage.
(e) Except as otherwise specifically provided in this
Section, all Casualty Proceeds and all Condemnation Proceeds recovered by the
Collateral Agent (A) are to be applied to the restoration of the applicable
Mortgaged Property (less the reasonable cost, if any, to the Collateral Agent of
such recovery and of paying out such proceeds, including reasonable attorneys'
fees (including the allocated costs of in-house legal counsel), other charges
and disbursements and costs allocable to inspecting the Work (as defined below))
and (B) shall be applied by the Collateral Agent to the payment of the cost of
restoring or replacing the Mortgaged Property so damaged, destroyed or taken or
of the portion or portions of the Mortgaged Property not so taken (the "Work")
and (C) shall be paid out from time to time to the Borrower as and to the extent
the Work (or the location and acquisition of any replacement of any Mortgaged
Property) progresses for the payment thereof, but subject to each of the
following conditions:
(i) the Borrower must promptly commence the restoration
process or the location, acquisition and replacement process (in the case
of a total or "substantially all" Condemnation) in connection with the
Mortgaged Property;
80
Exhibit 10.1
(ii) the Work shall be in the charge of an architect or
engineer and before the Borrower commences any Work, other than temporary
work to protect property or prevent interference with business, the
Collateral Agent shall have received the plans and specifications and the
general contract for the Work from the Borrower. The plans and
specifications shall provide for such Work that, upon completion thereof,
the improvements shall (A) be in compliance with all requirements of
applicable Governmental Authorities such that all representations and
warranties of the Borrower relating to the compliance of such Mortgaged
Property with applicable laws, rules or regulations in this Agreement or
the Security Documents will be correct in all respects and (B) be at least
equal in value and general utility to the improvements that were on such
Mortgaged Property (or that were on the Mortgaged Property that has been
replaced, if applicable) prior to the Casualty or Taking, and in the case
of a Taking, subject to the effect of such Taking;
(iii) except as provided in clause (iv), each request for
payment shall be made on seven days' prior notice to the Collateral Agent
and shall be accompanied by a certificate to be made by such architect or
engineer, stating (A) that all the Work completed has been done in
substantial compliance with the plans and specifications, (B) that the sum
requested is justly required to reimburse the Borrower for payments by the
Borrower to, or is justly due to, the contractor, subcontractors,
materialmen, laborers, engineers, architects or other persons rendering
services or materials for the Work (giving a brief description of such
services and materials) and that, when added to all sums previously paid
out by the Collateral Agent, does not exceed the value of the Work done to
the date of such certificate;
(iv) each request for payment in connection with the
acquisition of a replacement Mortgaged Property (in the case of a total or
"substantially all" Condemnation) shall be made on 30 days' prior notice to
the Collateral Agent and, in connection therewith, (A) each such request
shall be accompanied by a copy of the sales contract or other document
governing the acquisition of the replacement property by the Borrower and a
certificate of the Borrower stating that the sum requested represents the
sales price under such contract or document and the related reasonable
transaction fees and expenses (including brokerage fees) and setting forth
in sufficient detail the various components of such requested sum and (B)
the Borrower shall (I) in addition to any other items required to be
delivered under this Section), provide the Administrative Agent and the
Collateral Agent with such opinions, documents, certificates, title
insurance policies, surveys and other insurance policies as they may
reasonably request and (II) take such other actions as the Administrative
Agent and the Collateral Agent may reasonably deem necessary or appropriate
(including actions with respect to the delivery to the Collateral Agent of
a first priority Mortgage with respect to such real property for the
ratable benefit of the Secured Parties);
(v) each request shall be accompanied by waivers of lien
satisfactory to the Collateral Agent covering that part of the Work for
which payment or reimbursement is being requested and, if required by the
Collateral Agent, by a search prepared by a title company or licensed
abstractor or by other evidence satisfactory to the Collateral Agent, that
there has not been filed with respect to such Mortgaged Property any
mechanics' or
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Exhibit 10.1
other lien or instrument for the retention of title in respect of any part
of the Work not discharged of record or bonded to the reasonable
satisfaction of the Collateral Agent;
(vi) there shall be no Default or Event of Default that has
occurred and is continuing;
(vii) the request for any payment after the Work has been
completed shall be accompanied by a copy of any certificate or certificates
required by law to render occupancy of the improvements being rebuilt,
repaired or restored legal; and
(viii) after commencing the Work, the Borrower shall continue
to perform the Work diligently and in good faith to completion in
accordance with the approved plans and specifications.
Upon completion of the Work and payment in full therefor, the Collateral Agent
will disburse to the Borrower the amount of any Casualty Proceeds or
Condemnation Proceeds then or thereafter in the hands of the Collateral Agent on
account of the Casualty or Taking that necessitated such Work to be applied (x)
to prepay obligations outstanding under this Agreement, with any excess being
returned to the Borrower, or (y) to be reinvested in the Borrower's principal
lines of business within 180 days after the receipt thereof, provided that the
Borrower, pending such reinvestment, promptly deposits such amounts in a cash
collateral account established with the Collateral Agent for the benefit of the
Secured Parties.
(f) Notwithstanding any other provisions of this Section,
if the Borrower shall have elected to replace a Mortgaged Property in connection
with a total or "substantially all" Condemnation as contemplated in clause (c),
all Condemnation Proceeds held by the Collateral Agent in connection therewith
shall be applied to prepay obligations outstanding under this Agreement if (i)
the Borrower notifies the Collateral Agent and the Administrative Agent that it
does not intend to replace the related Mortgaged Property, (ii) a Responsible
Officer of the Borrower shall not have notified the Administrative Agent and the
Collateral Agent in writing that the Borrower has acquired or has entered into a
binding contract to acquire land upon which it will construct the replacement
property within six months after the related Condemnation or (iii) the Borrower
shall have not notified the Administrative Agent and the Collateral Agent in
writing that it has begun construction of the replacement structures within one
year after the related Condemnation.
(g) Nothing in this Section shall prevent the Collateral
Agent from applying at any time all or any part of the Casualty Proceeds or
Condemnation Proceeds to (i) the curing of any Event of Default under this
Agreement or (ii) the payment of any of the Obligations after the occurrence and
during the continuance of an Event of Default.
SECTION 5.13. Sale of Excess Real Estate. Borrower shall use
commercially reasonable efforts to sell the property identified as "Excess Real
Estate" on Schedule 3.20(a) (the "Excess Real Estate") for a sales price in cash
equivalent to its Fair Market Value by no later than June 30, 2003. Borrower
shall notify the Administrative Agent as soon as practicable of any pending sale
date, the expected sales price therefor and the proposed purchaser. Upon the
consummation of any such sale of Excess Real Estate, Collateral Agent shall
release the Lien on behalf of Lenders on such Excess Real Estate.
82
Exhibit 10.1
SECTION 5.14. Certain Collateral Matters.
(a) Borrower will use its commercially reasonable efforts to
obtain such lessor consents as may be required to encumber in favor of
Collateral Agent for the benefit of Lenders the leases located at the properties
identified as being requested to be subject to a leasehold mortgage on Schedule
1.01(b); provided, however other than the payment of reasonable counsel fees and
other out-of-pocket expenses, Borrower shall not be required to make payment to
a lessor in order to obtain such consent.
(b) Other than any domestic Immaterial Subsidiary so
designated and identified on Schedule 3.08, Holding, Borrower and each domestic
Restricted Subsidiary of Borrower have executed the Security Agreement, the
Guaranty, the Pledge Agreement and such other Security Documents as may be
reasonably requested by Collateral Agent.
(c) If requested by Collateral Agent, as soon as practicable
after the Effective Date Borrower will take all such actions as may reasonably
be requested by Collateral Agent and as do not create materially adverse tax
consequences for the Borrower to assure the Collateral Agent that it has a duly
perfected security interest under the laws of Mexico in all of the property and
assets of Borrower and its Subsidiaries which are located in Mexico (including a
pledge of the ownership interests in such Subsidiaries), including without
limitation the execution of a Guarantee and other Security Documents by Borrower
and/or the Subsidiaries of Borrower operating in Mexico.
(d) Borrower will cause Xxxxxxx Xxxxxx or its Affiliates to
pledge pursuant to the Nonrecourse Pledge Agreement, all other evidences of
senior indebtedness of HRC Holding or Borrower or any of its Restricted
Subsidiaries to Xxxxxxx Xxxxxx, any Affiliate of Xxxxxxx Xxxxxx or any
shareholder of Borrower or Holding and outstanding on the Effective Date, and
all other investments of Xxxxxxx Xxxxxx, any Affiliate of Xxxxxxx Xxxxxx or any
shareholder of Borrower or Holding made after the Effective Date in Borrower or
its Restricted Subsidiaries or in HRC Holding and required to be so pledged
pursuant to Section 6.01(k).
(e) In the event that the stock of Xxxxxx Euro Co S.a.r.l or
any of its Subsidiaries (the "European Companies Shares") is not required to be
pledged to support any bona fide third party Indebtedness extended to such
companies and no material adverse tax consequences to Borrower would occur as a
result thereof, Borrower shall cause the European Companies Shares to be pledged
to Collateral Agent for the benefit of Lenders or to the extent not available to
Collateral Agent as a result of material adverse tax consequences, Borrower will
not permit such European Companies Shares to be otherwise pledged or encumbered
except as may be required to support any bona fide third party Indebtedness to
such Unrestricted Subsidiaries.
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness. The Borrower will not, and will
not permit any Restricted Subsidiary to, incur, create, assume or permit to
exist any Indebtedness, except:
83
Exhibit 10.1
(a) Indebtedness for borrowed money existing on the Closing
Date and set forth in Schedule 6.01(a); provided, however, that such
Indebtedness shall be repaid concurrently with the incurrence of the Borrowing
of the Initial Credit Event hereunder ("Indebtedness to be Paid");
(b) Indebtedness represented by the Notes and by the other
Credit Documents;
(c) Indebtedness under the Senior Subordinated Notes (as the
same may be amended from time to time, without increasing the committed amount
thereunder, except as otherwise permitted by this Section) and any Refinancing
Indebtedness of the Borrower with respect thereto in an aggregate principal
amount on the date of Incurrence that, when added to all other Indebtedness
Incurred pursuant to this clause and then outstanding, shall not exceed the sum
of the then outstanding Indebtedness under the Senior Subordinated Notes;
provided that such Refinancing Indebtedness is subordinated to the Obligations
on terms and conditions that are no less favorable than the subordination
provisions with respect to the Senior Subordinated Notes;
(d) Indebtedness (i) of the Borrower to any wholly owned
Restricted Subsidiary or to any Guarantor and (ii) of any Restricted Subsidiary
to the Borrower or any wholly owned Restricted Subsidiary;
(e) Indebtedness represented by the Guarantees of
Indebtedness Incurred pursuant to clause (c) (provided, that any Guarantee with
respect to the Senior Subordinated Notes will be subordinated to the same extent
as the Senior Subordinated Notes) or clause (d);
(f) Indebtedness relating to Capital Lease Obligations,
Sale/Leaseback Transactions and Permitted Purchase Money Liens; provided, that
(i) with respect to Capital Lease Obligations, Indebtedness
relating to Purchase Money Liens and Unrestricted Sale/Leaseback
Transactions, either (A) the Incurrence of such Indebtedness relating to
Capital Expenditures, Unrestricted Sale/Leaseback Transactions and
Permitted Purchase Money Liens would be permitted pursuant to Section 6.08
in the fiscal year in which it is Incurred, or (B) the aggregate principal
amount of such Indebtedness does not exceed $10,000,000 at any one time;
and
(ii) with respect to Restricted Sale/Leaseback Transactions,
if the Net Cash Proceeds thereof are applied in accordance with Section
2.13(b).
(g) Indebtedness under Hedging Obligations; provided,
however, that such Hedging Obligations are entered into for bona fide hedging
purposes of the Borrower or its Restricted Subsidiaries (as determined in good
faith by the Board of Directors or senior management of the Borrower) and
correspond in terms of notional amount, duration, currencies and interest rates,
as applicable, to Indebtedness of the Borrower or its Restricted Subsidiaries
Incurred without violation of this Agreement or to business transactions of the
Borrower or its Restricted Subsidiaries on customary terms entered into in the
ordinary course of business;
(h) Indebtedness represented by Guarantees constituting
Investments permitted by Section 6.03(c)(iii) and disclosed on Schedule 6.03(c);
84
Exhibit 10.1
(i) The FS Convertible Senior Subordinated Debt and the Senior Notes
outstanding on the Effective Date and any additional Senior Notes issued
pursuant to Section 2.11(d);
(j) Indebtedness in an aggregate principal amount which, together with
all other Indebtedness of the Borrower and the Restricted Subsidiaries
outstanding on the date of such Incurrence (other than Indebtedness permitted by
clauses (a) through (g) and clause (i)) does not exceed $5,000,000 at any one
time outstanding;
provided that notwithstanding anything in this Agreement to the contrary, the
sum of the aggregate outstanding principal amount of all Indebtedness permitted
under clauses (i) and (j) of this Section 6.01 (excluding the Senior Notes
permitted pursuant to clause (i)) shall not exceed $15,000,000; and
(k) to the extent such Indebtedness is permitted under the terms of the
Indenture governing the Senior Subordinated Notes, direct or indirect
Indebtedness of Borrower or HRC Holding incurred after the Effective Date to
Xxxxxxx Xxxxxx, any Affiliate of Xxxxxxx Xxxxxx or any shareholder of Borrower
or Holding (collectively, the "Affiliate Indebtedness") provided that (i) the
first $5,000,000 in aggregate principal amount of such Affiliate Indebtedness
constitutes Indebtedness not subordinated to any other Indebtedness of Borrower
or HRC Holding, as the case may be, pledged to Collateral Agent under the
Nonrecourse Pledge Agreement and (ii) at the time of such incurrence, the
principal amount of the Affiliate Indebtedness incurred by Borrower under this
clause (k) does not exceed $5,000,000 less the amount of Affiliate Indebtedness
previously incurred by HRC Holding after the Effective Date.
SECTION 6.02. Liens. The Borrower will not, and will not permit any
Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on
any property or assets (including stock or other securities of any person,
including any Subsidiary) now owned or hereafter acquired by it or on any income
or revenues or rights in respect of any thereof, except:
(a) Liens on property or assets of the Borrower and its Subsidiaries
existing on the Closing Date and set forth in Schedule 6.02(a); provided that
such Liens shall secure only those obligations which they secure on the Closing
Date;
(b) any Lien created under the Credit Documents;
(c) any Lien existing on any property or asset prior to the acquisition
thereof by the Borrower or any Subsidiary; provided that (i) such Lien is not
created in contemplation of or in connection with such acquisition, and (ii)
such Lien does not apply to any other property or assets of the Borrower or any
Subsidiary;
(d) Liens for taxes not yet due or which are being contested in
compliance with Section 5.03;
(e) carriers', warehousemen's, mechanics', materialmen's, repairmen's or
other like Liens arising in the ordinary course of business and securing
obligations that are not due and payable or which are being contested in
compliance with Section 5.03;
85
Exhibit 10.1
(f) pledges and deposits made in the ordinary course of business in
compliance with workmen's compensation, unemployment insurance and other social
security laws or regulations;
(g) Liens and deposits to secure the performance of bids, contracts
(other than for Indebtedness), leases (other than Capital Lease Obligations),
statutory obligations, surety, indemnity and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
(h) zoning restrictions, easements, rights-of-way, restrictions on use of
real property and other similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not substantial in amount and do not
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the business of the Borrower or any of its
Subsidiaries;
(i) Liens relating to Indebtedness described in Section 6.01(f);
(j) any interest or title of a lessor or any Lien encumbering such
lessor's interest with respect to any lease to the Borrower or any Subsidiary;
and
(k) judgment Liens that do not otherwise constitute an Event of Default.
SECTION 6.03. Investments, Loans and Advances. The Borrower will not, and
will not permit any Restricted Subsidiary to, make or permit to exist any
Investment in any other person, except:
(a) Investments by the Borrower existing on the Closing Date in the
capital stock of the Subsidiaries;
(b) Permitted Investments;
(c) (i) Investments in Unrestricted Subsidiaries (other than US Holdco,
Euro Holdco and Swedish Acquisitionco and their Subsidiaries) not to
exceed $20,000 in the aggregate at any one time;
(ii) so long as US Holdco, Euro Holdco and Swedish Acquisitionco are
Unrestricted Subsidiaries, the Investment by the Borrower in US Holdco,
Euro Holdco or Swedish Acquisitionco and their Subsidiaries to be made as
part of the Gibeck AB Acquisition as described in Item 7 of Annex 4; and
(iii) so long as US Holdco, Euro Holdco and Swedish Acquisitionco and
their Subsidiaries are Unrestricted Subsidiaries, additional Investments
by the Borrower in US Holdco, Euro Holdco or Swedish Acquisitionco or any
of their Subsidiaries not to exceed in the aggregate the proceeds of any
Designated Capital Investments or other Investments received by the
Borrower from Holding and disclosed in Schedule 6.03(c) and any other
Designated Capital Investment approved in writing by Administrative Agent;
and
(d) Investments in Restricted Subsidiaries;
86
Exhibit 10.1
(e) Investments made in connection with Permitted Investments;
(f) Investments which would be permitted as Indebtedness pursuant to
Section 6.01;
(g) loans and advances to employees of the Borrower and any Restricted
Subsidiary made in the ordinary course of business consistent with past
practices of the Borrower or such Restricted Subsidiary; provided that the
aggregate principal amount of such loans, advances and Employee Notes payable
shall not exceed $1,000,000 at any one time outstanding;
(h) loans and advances to, or Employee Notes received from, employees of
Holding, the Borrower or any of their Subsidiaries made or received in
connection with the substantially concurrent purchase of common stock of Holding
or the Borrower by such employees; provided that the aggregate principal amount
of such loans, advances and Employee Notes payable shall not exceed $1,000,000
at any one time outstanding; and
(i) other Investments in an aggregate amount not in excess of $500,000 at
any one time outstanding.
SECTION 6.04. Mergers, Consolidations, Sales of Assets and Acquisitions.
(a) The Borrower will not merge, consolidate or amalgamate with or into
any other person (other than a merger of a wholly owned Subsidiary into the
Borrower) unless: (i) the Borrower shall be the surviving person (the "Surviving
Person") or the Surviving Person (if other than the Borrower) formed by such
merger, consolidation or amalgamation shall be a corporation organized and
existing under the laws of the State of Delaware, (ii) the Surviving Person (if
other than the Borrower) shall expressly assume, by an agreement satisfactory in
form and substance to the Agents, executed and delivered to the Agents by the
Surviving Person, the due and punctual performance of all of the obligations and
agreements of the Borrower under this Agreement, (iii) immediately after giving
effect to such merger, consolidation or amalgamation, no Default or Event of
Default shall have occurred, and (iv) the Borrower shall have carried out any
acts necessary to ensure that any security interest purported to be created by
any Security Document shall continue to be a valid, perfected, first priority
(except as otherwise expressly provided in this Agreement or such Security
Document) security interest in the applicable Collateral.
(b) The Borrower will not permit any Restricted Subsidiary to merge into
or consolidate with any other person, or permit any other person to merge into
or consolidate with it, except that if at the time thereof and immediately after
giving effect thereto no Event of Default or Default shall have occurred and be
continuing (i) any wholly owned Subsidiary may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation and (ii) any
wholly owned Subsidiary may merge into or consolidate with any other wholly
owned Subsidiary in a transaction in which the surviving entity is a wholly
owned Subsidiary and no person other than the Borrower or a wholly owned
Subsidiary receives any consideration.
(c) The Borrower will not, and will not permit any Restricted Subsidiary
to, purchase, lease, or otherwise acquire (in one transaction or a series of
transactions) any Assets or capital stock (or other equity interests) of any
person other than as permitted pursuant to Section 6.03 (provided that
Investments pursuant to section 6.03(d) shall be limited to Restricted
87
Exhibit 10.1
Subsidiaries existing as of the Fifth Amendment Effective Date), Section 6.08
and, with the consent of Required Lenders, Permitted Acquisitions.
(d) The Borrower will not, and will not permit any Restricted Subsidiary
to, enter into any Asset Disposition or Sale/Leaseback Transaction, except for
(i) Unrestricted Asset Dispositions, (ii) Unrestricted Sale/Leaseback
Transactions permitted by Section 6.01(f), (iii) Restricted Asset Dispositions,
the Net Cash Proceeds of which are applied in accordance with Section 2.13(b)
and any non-cash proceeds of which are pledged pursuant to the Pledge Agreement
or the Security Agreement to Collateral Agent for the benefit of Lenders, and
(iv) Restricted Sale/Leaseback Transactions which are permitted by Section
6.01(f) and the Net Cash Proceeds of which are applied in accordance with
Section 2.13(b) and any non-cash proceeds of which are pledged pursuant to the
Pledge Agreement or the Security Agreement to Collateral Agent for the benefit
of Lenders; provided that any Restricted Asset Disposition or Restricted
Sale/Leaseback Transaction be made for a consideration equal to the Fair Market
Value of the asset so transferred, that the proceeds thereof shall be at least
80% cash and that the aggregate amount of all such Restricted Asset Dispositions
and Restricted Sale/Leaseback Transactions, excluding the sale of the Excess
Real Estate, not exceed $5,000,000 in any fiscal year.
SECTION 6.05. Dividends and Distributions; Restrictions on Ability of
Subsidiaries to Pay Dividends. Neither Holding nor the Borrower shall, and the
Borrower shall not permit any Restricted Subsidiary to,
(a) Directly or indirectly, declare or pay any dividend or make any
distribution (whether in cash, securities or other Property) on or with respect
to the Capital Stock of the Borrower or any Restricted Subsidiary (including any
payment in connection with any merger or consolidation with or into the Borrower
or any Restricted Subsidiary) except for any dividends or distributions payable
solely in its Capital Stock (other than Disqualified Stock) and except any
dividend or distribution which is made to the Borrower or a wholly owned
Restricted Subsidiary (provided that such Restricted Subsidiary is a Wholly
Owned Subsidiary), or any dividend or distribution payable solely in shares of
Capital Stock (other than Redeemable Stock) of the Borrower, purchase,
repurchase, redeem, retire or otherwise acquire for value any Capital Stock of
the Borrower or any Affiliate of the Borrower held by persons other than the
Borrower or a Restricted Subsidiary or any Securities exchangeable for or
convertible into any such Capital Stock (other than for or into Capital Stock of
the Borrower that is not Disqualified Stock), purchase, repurchase, redeem,
defease or otherwise acquire or retire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment any Subordinated
Obligations (other than the purchase, repurchase or other acquisition of
Subordinated Obligations purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one
year of the date of acquisition, or the refinancing of any Subordinated
Obligations with Refinancing Indebtedness other than as permitted pursuant to
Section 6.01(c)), or make any Investment (other than pursuant to Section 6.03)
in any person or to pay cash interest on the FS Convertible Senior Subordinated
Debt (any such dividend, distribution, purchase, redemption, repurchase,
defeasance, other acquisition, retirement, Investment or payment being herein
referred to as a "Restricted Payment"); provided, however, that
(i) the purchase, repurchase, redeem, legally defease, acquire or retire
for value, or pay dividends or make loans to Holding to enable Holding
substantially concurrently therewith to purchase, repurchase, redeem, legally
defease, acquire or retire
88
Exhibit 10.1
for value, shares of, or options to purchase shares of, Capital Stock of the
Borrower or Holding from employees or former employees of the Borrower, Holding
or any of their Subsidiaries (or their estates or beneficiaries thereof) upon
death, disability, retirement or termination pursuant to the terms of the
agreements (including employment agreements) or plans (or amendments thereto)
approved by the board of directors of the Borrower or Holding, as the case may
be, under which such individuals purchase or sell, or are granted the option to
purchase or sell, shares of such Capital Stock; provided, that (i) the aggregate
amount of such purchases, repurchases, redemptions, defeasances, acquisitions or
retirements shall not exceed $1,000,000 in any fiscal year or $3,000,000 in the
aggregate after the Closing Date, except that (x) such amounts shall be
increased by the aggregate net amount of cash received by the Borrower after the
Closing Date from the sale of such Capital Stock to, or the exercise of options
to purchase such shares by, employees of the Borrower, Holding or any of their
Subsidiaries, and (y) the Borrower may forgive or return Employee Notes without
regard to the limitations set forth in clause (d)(i) and such forgiveness or
return shall not be treated as a Restricted Payment for purpose of determining
compliance with clause (d)(i) and such purchases, repurchases, defeasances,
acquisitions or retirements (but not forgiveness or returns of Employee Notes)
shall be included in the calculation of the amount of Restricted Payments;
(ii) beginning not earlier than the fifth anniversary of the Closing Date
and provided that no Default or Event of Default then exists or would occur as a
result of such payment, Holding may pay cash dividends on Holding's Exchangeable
Preferred Stock, but only in accordance with the terms of Holding's Exchangeable
Preferred Stock in amounts not greater than 11 1/2% per annum of the original
aggregate liquidation preference of such Exchangeable Preferred Stock plus
accreted PIK liquidation preference and provided that the funds used to make
such cash dividend payments are not directly or indirectly provided by Borrower
or any Subsidiary thereof;
(iii) the Borrower may redeem the Borrower's Exchangeable Preferred Stock
(including accreted PIK liquidation preference) with Net Cash Proceeds of an
Equity Issuance pursuant to Section 2.13(c)(i) in accordance with its terms;
provided, however, that Holdings shall concurrently apply the proceeds of such
redemption to redeem a like amount of Holding's Exchangeable Preferred Stock;
(iv) the Borrower and/or Holding may make Contingent Acquisition-Related
Payments;
(v) the Borrower may pay dividends on the Borrower's Exchangeable
Preferred Stock in cash, but only (A) to the extent that such cash is to be used
by Holding to pay in cash dividends on Holding's Exchangeable Preferred Stock
that, if paid in kind, would otherwise have required the issuance of a
fractional share of Holding's Exchangeable Preferred Stock, and (B) up to an
aggregate amount of $25,000 in any fiscal year of the Borrower;
(vi) Holding may pay dividends on Holding's Exchangeable Preferred Stock
in cash, but only (A) to the extent that such dividend, if paid in kind, would
otherwise have required the issuance of a fractional share of Holding's
Exchangeable Preferred Stock, and (B) up to an aggregate amount of $25,000 in
any fiscal year of Holding; and
89
Exhibit 10.1
(vii) To the extent that the tender offer referred to in Item 6 of
Annex 4 is not consummated, and provided that no Default or Event of
Default has occurred and is continuing,
(A) to the extent that the Borrower has received as a return of
capital or dividend any portion of the Investment by the Borrower in
US Holdco, Euro Holdco or Swedish Acquisitionco described in Item 7 of
Annex 4 (or the Borrower does not make the Investment described in
Item 7 of Annex 4), the Borrower may pay as a return of capital or
dividend such amount (less the amount of any costs and expenses
incurred by the Borrower in connection with the transactions described
in Annex 4) to Holding; and
(B) to the extent that Holding has received a return of capital
or dividend pursuant to clause (A), Holding may pay such amount as a
dividend or return of capital to Xxxxxxx Xxxxxx;
(b) Permit its subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction on the ability of any such subsidiary to (i) pay any
dividends or make any other distributions on its capital stock or any other
interest or (ii) make or repay any loans or advances to the Borrower or Holding
of such subsidiary, or
(c) Make any interest payment, or permit its subsidiaries to make
any interest payment on any Subordinated Obligations with the proceeds, in whole
or in part, of Loans if at any time during the five Business Day period
preceding the borrowing of such Loans, the outstanding aggregate Revolving
Credit Exposure used by the Borrower for any purpose other than Permitted
Acquisitions exceeds $8,000,000, unless the Administrative Agent has consented
in writing to such payment.
SECTION 6.06. Transactions with Affiliates. Neither Holding nor the
Borrower shall, and the Borrower shall not permit any Restricted Subsidiary to,
directly or indirectly, conduct any business or enter into or suffer to exist
any transaction or series of transactions (including the purchase, sale,
transfer, assignment, lease, conveyance or exchange of any Property or the
rendering of any service) with, or for the benefit of, any Affiliate of the
Borrower, other than the payment of Transaction Costs approved by the
Syndication Agent prior to the Closing Date (an "Affiliate Transaction"), unless
the terms of such Affiliate Transaction are (i) set forth in writing, (ii) in
the interests of the Borrower or such Restricted Subsidiary as the case may be,
and (iii) no less favorable to the Borrower or such Restricted Subsidiary, as
the case may be, than those that could be obtained in a comparable arm's length
transaction with a person that is not an Affiliate of the Borrower; provided
that upon the occurrence and during the continuance of a Default or an Event of
Default, no fees shall be payable to Xxxxxxx Xxxxxx or any of its Affiliates.
Notwithstanding the foregoing limitations, the Borrower or any Restricted
Subsidiary may enter into or permit to exist the following:
(a) any transaction permitted pursuant to Section 6.03, Section
6.05 or Section 6.13;
(b) the issuance of Capital Stock for cash;
90
Exhibit 10.1
(c) the payment of compensation (including amounts paid pursuant to
employee benefit plans) for the personal services of officers, directors and
employees of the Borrower or any of the Restricted Subsidiaries, so long as the
board of directors of the Borrower in good faith shall have approved the terms
thereof and deemed the services theretofore or thereafter to be performed for
such compensation to be fair consideration therefor;
(d) the payment of the Transaction Costs; or
(e) the Investment by the Borrower in US Holdco, Euro Holdco and
Swedish Acquisitionco in connection with the Gibeck AB Acquisition and
Investments by the Borrower in US Holdco, Euro Holdco and Swedish Acquisitionco
permitted by Section 6.03(c)(iii).
SECTION 6.07. Business of Holding, Borrower and Subsidiaries. The
Borrower will not, and will not permit any Restricted Subsidiary to, engage at
any time in any business or business activity other than the business currently
conducted by it and business activities reasonably related or complementary
thereto. Notwithstanding anything to the contrary in this Agreement, Holding
shall not engage in any business, or have any assets, operations, obligations,
liabilities or employees, except as specifically contemplated in the Credit
Documents and the Recapitalization Agreements.
SECTION 6.08. Capital Expenditures. The Borrower will not, and will
not permit any Restricted Subsidiary to, or make Capital Expenditures if the
aggregate amount thereof would exceed $8,000,000 in any fiscal year; provided,
that the unused portion of such $8,000,000 (not to exceed $4,000,000) may be
carried forward to be used in the following fiscal year.
SECTION 6.09. Debt/Adjusted EBITDA Ratio. Reserved.
SECTION 6.10. Minimum EBITDA. The Borrower's EBITDA for the three
consecutive fiscal quarter period ending on or about September 30, 2002, shall
not be less than $13,000,000 and for each four consecutive fiscal quarter period
ending nearest to the following dates shall not be less than the following
amounts:
----------------------------------------------------------------------
Fiscal Minimum EBITDA
Quarter
Ending
Nearest to
---------------------------------------------------
2002 2003 2004
----------------------------------------------------------------------
March 31 $21,000,000 $25,000,000
----------------------------------------------------------------------
June 30 $22,000,000 $25,000,000
----------------------------------------------------------------------
September 30 $23,000,000
----------------------------------------------------------------------
December 31 $20,000,000 $24,000,000
----------------------------------------------------------------------
91
Exhibit 10.1
SECTION 6.11. Interest Coverage Ratio. Reserved.
SECTION 6.12. Fixed Charge Coverage Ratio. Reserved
SECTION 6.13. Modification of Certain Agreements. Neither Holding,
the Borrower nor any Restricted Subsidiary shall (i) consent to any amendment,
supplement or other modification of any of the terms or provisions contained in
the Senior Subordinated Notes, the Exchangeable Preferred Stock, the Senior
Notes, the HRC Holding Senior Notes, or any document or instrument evidencing or
applicable to any Subordinated Obligation, other than any amendment, supplement
or other modification which extends the date or reduces the amount of any
required repayment or redemption and other than any amendment, supplement or
other modification to the Senior Notes which: (a) is consummated without any
condition precedent or subsequent remaining unsatisfied or unwaived prior to the
six-month anniversary of the Effective Date in connection with a restructuring
or exchange of Borrower's Senior Subordinated Notes which reduces Borrower's
overall Indebtedness or interest costs, (b) converts the Senior Notes to Capital
Stock (other than Disqualified Stock), which Capital Stock remains pledged to
Collateral Agent pursuant to the Nonrecourse Pledge Agreement and (c) occurs at
a time when no Default or Event of Default has occurred and is continuing or
would arise as a result of such transactions under the Credit Documents; or (ii)
make any optional payment, prepayment, purchase, redemption or other payment or
distribution on or with respect to Senior Notes which have been pledged to
Collateral Agent (the "Pledged Senior Notes") other than any payment required to
be made under the terms of such Pledged Senior Notes as in effect on the
Effective Date and paid to the Collateral Agent pursuant to the terms of the
Nonrecourse Pledge Agreement or cancel, terminate or forgive any Indebtedness
owing on or with respect to such Pledged Senior Notes (other than the conversion
or exchange of such Pledged Senior Notes to or for pledged Capital Stock in
compliance with the foregoing clauses (a)-(c)).
SECTION 6.14. Additional Provisions Concerning Unrestricted
Subsidiaries.
(a) The daily average Intercompany Receivable during any quarter may
not exceed $3,500,000 and the daily outstanding balance of the Intercompany
Receivable may not exceed $5,000,000.
(b) Borrower will not permit any of its Unrestricted Subsidiaries to
make any payment, prepayment, purchase, redemption or other payment or
distribution on or with respect to any Indebtedness owed to Xxxxxxx Xxxxxx, any
Affiliate of Xxxxxxx Xxxxxx or any shareholder of Borrower or Holding, other
than any payment on or with respect to the HRC Holding Senior Notes which have
been pledged to Collateral Agent (the "Pledged HRC Holding Senior Notes") which
payment is required to be made under the terms of such Pledged HRC Holding
Senior Notes as in effect on the Effective Date and paid to the Collateral Agent
pursuant to the terms of the Nonrecourse Pledge Agreement or cancel, terminate
or forgive any Indebtedness owing on or with respect to such Pledged HRC Holding
Senior Notes; and Borrower will not permit any of its Unrestricted Subsidiaries
to sell, transfer, assign, lease or dispose of any asset or property to or for
the benefit of Xxxxxxx Xxxxxx, any Affiliate of Xxxxxxx Xxxxxx or any
shareholder of Borrower or Holding other than in a transaction which is (i) in
writing, (ii) in the interests of such Unrestricted Subsidiary, (iii) no less
favorable to such Unrestricted Subsidiary than those that could be obtained in a
comparable arm's length transaction with a person that is not an Affiliate of
such Unrestricted Subsidiary, and (iv) for a consideration which is not less
than 80% cash. Borrower will require
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Exhibit 10.1
HRC Holding to cause each such payee to pledge to Collateral Agent under the
Nonrecourse Pledge Agreement any Indebtedness of HRC Holding which is not
subordinated to any other Indebtedness of HRC Holding and which is owed to
Xxxxxxx Xxxxxx, any Affiliate of Xxxxxxx Xxxxxx or any shareholder of Borrower
or Holding unless such Indebtedness is unsecured and no scheduled payment is
required with respect to such Indebtedness prior to the later to occur of the
Loan Maturity Date or the Revolving Credit Maturity Date.
SECTION 6.15. Bank Accounts. Neither Holding, the Borrower nor any
Restricted Subsidiary shall open or maintain any new bank account at any
financial institution that is not a Lender. Within 30 days of the Effective Date
or such longer period of time as is approved by Administrative Agent, Borrower,
the Administrative Agent and each of First Midwest Bank and Union Bank shall
enter into a control account agreement providing that upon the occurrence of an
Event of Default and notice by the Administrative Agent, all collected amounts
in such account will be transferred to Administrative Agent for repayment of the
Revolving Loans but without any related commitment reduction.
ARTICLE VII
Defaults and Remedies
SECTION 7.01. Events of Default. In case of the happening of any of
the following events ("Events of Default"):
(a) any representation or warranty made or deemed made in or in
connection with any Credit Document or the borrowings or issuances of Letters of
Credit hereunder, or any representation, warranty, statement or information
contained in any report, certificate, financial statement or other instrument
furnished in connection with or pursuant to any Credit Document, shall prove to
have been false or misleading in any material respect when so made, deemed made
or furnished;
(b) default shall be made in the payment of any principal of any Loan
or the reimbursement with respect to any L/C Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or by acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on any Loan
or any Fee or L/C Disbursement (after demand for such reimbursement) or any
other amount (other than an amount referred to in clause (b)) due under any
Credit Document, when and as the same shall become due and payable, and such
default shall continue unremedied for a period of three Business Days;
(d) default shall be made in the due observance or performance by
Holding, the Borrower or any Restricted Subsidiary of any covenant, condition or
agreement contained in Section 5.01(a), 5.05 or 5.07(b) or in Article VI;
(e) default shall be made in the due observance or performance by
Holding, the Borrower or any Restricted Subsidiary or any party to the
Nonrecourse Pledge Agreement (other than Collateral Agent) of any covenant,
condition or agreement contained in any Credit Document
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Exhibit 10.1
(other than those specified in clause (b), (c) or (d) ) and such default shall
continue unremedied for a period of 15 days after notice thereof from the
Administrative Agent or any Lender to the Borrower;
(f) Holding, the Borrower or any Restricted Subsidiary shall (i) fail
to pay any principal or interest, regardless of amount, due in respect of any
Indebtedness in a principal amount in excess of $2,500,000, when and as the same
shall become due and payable, or (ii) fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or instrument
evidencing or governing any such Indebtedness if the effect of any failure
referred to in this clause (ii) is to cause, or to permit the holder or holders
of such Indebtedness or a trustee on its or their behalf (with or without the
giving of notice, the lapse of time or both) to cause, such Indebtedness to
become due prior to its stated maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of Holding, the Borrower or any Material Subsidiary, or of a
substantial part of the property or assets of Holding, the Borrower or a
Material Subsidiary, under Title 11 of the United States Code, as now
constituted or hereafter amended, or any other Federal, state or foreign
bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
Holding, the Borrower or any Material Subsidiary or for a substantial part of
the property or assets of Holding, the Borrower or a Material Subsidiary, (iii)
the winding-up or liquidation of Holding, the Borrower or any Material
Subsidiary; and such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered, or (iv) any similar relief is granted under any foreign laws;
(h) Holding, the Borrower or any Material Subsidiary shall (i)
voluntarily commence any proceeding or file any petition seeking relief under
Title 11 of the United States Code, as now constituted or hereafter amended, or
any other Federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (ii) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or the filing of any petition described
in clause (g), (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for Holding,
the Borrower or any Material Subsidiary or for a substantial part of the
property or assets of Holding, the Borrower or any Material Subsidiary, (iv)
file an answer admitting the material allegations of a petition filed against it
in any such proceeding, (v) make a general assignment for the benefit of
creditors, (vi) become unable, admit in writing its inability or fail generally
to pay its debts as they become due or (vii) take any action for the purpose of
effecting any of the foregoing;
(i) one or more judgments for the payment of money in an aggregate
amount in excess of $2,500,000 shall be rendered against Holding, the Borrower,
any Restricted Subsidiary or any combination thereof and the same shall remain
undischarged for a period of 30 consecutive days during which execution shall
not be effectively stayed, or any action shall be legally taken (and not stayed)
by a judgment creditor to levy upon assets or properties of Holding, the
Borrower or any Subsidiary to enforce any such judgment;
(j) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other such ERISA Events, could
reasonably be expected to
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Exhibit 10.1
result in liability of the Borrower and its ERISA Affiliates in an aggregate
amount exceeding $1,000,000 or requires payments exceeding $500,000 in any year;
(k) any security interest purported to be created by any Security
Document shall cease to be, or shall be asserted by the Borrower or any other
Credit Party not to be, a valid, perfected, first priority (except as otherwise
expressly provided in this Agreement or such Security Document) security
interest in securities, assets or properties with a Fair Market Value of
$500,000 or more and purported to be covered thereby, except to the extent that
any such loss of perfection or priority results from the failure of the
Collateral Agent to maintain possession of certificates representing securities
pledged under the Pledge Agreement and except to the extent that such loss is
covered by a lender's title insurance policy and the related insurer promptly
after such loss shall have acknowledged in writing that such loss is covered by
such title insurance policy;
(l) any Credit Document shall cease, for any reason, to be in full
force and effect or any Credit Party or any of its Subsidiaries shall so assert
in writing;
(m) there shall have occurred a Change in Control;
(n) the audited financial statements for the fiscal year ending on or
about December 31, 2000 delivered pursuant to Section 5.04(a) are materially
adversely different than the draft of such financial statements delivered by the
Borrower to the Lenders on May 25, 2001 or are not accompanied by an opinion of
the Borrower's accountants complying with Section 5.04(a)(i) of the Credit
Agreement and a certificate of an officer complying with Section 5.04(d) of the
Credit Agreement; or
(o) the financial statements for the fiscal quarter ending on or
about March 31, 2001 delivered pursuant to Section 5.04(b) are materially
adversely different than the draft of such financial statements delivered by the
Borrower to the Lenders on June 18, 2001;
then, and in every such event (other than an event with respect to the Borrower
described in clause (g) or (h)), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Lenders having Loans (excluding Swingline Loans), L/C Exposure, Swingline
Exposure and unused Revolving Credit Commitments and Term Loan Commitments
representing at least a majority of the sum of all Loans outstanding (excluding
Swingline Loans), L/C Exposure, Swingline Exposure and unused Revolving Credit
Commitments and Term Loan Commitments at such time shall, by notice to the
Borrower, take either or both of the following actions, at the same or different
times: (i) terminate forthwith the Commitments and (ii) declare the Loans then
outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of the
Borrower accrued hereunder and under any other Credit Document, shall become
forthwith due and payable, without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived by the Borrower,
anything contained herein or in any other Credit Document to the contrary
notwithstanding; and in any event with respect to the Borrower described in
clause (g) or (h), the Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Borrower accrued
hereunder and under any other Credit Document, shall
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Exhibit 10.1
automatically become due and payable, without presentment, demand, protest or
any other notice of any kind, all of which are hereby expressly waived by the
Borrower, anything contained herein or in any other Credit Document to the
contrary notwithstanding.
ARTICLE VIII
The Agents
SECTION 8.01. Appointment of Administrative and Collateral Agent. In
order to expedite the transactions contemplated by this Agreement, Deutsche Bank
Trust Company Americas is hereby appointed to act as Administrative Agent and
Collateral Agent on behalf of the Lenders and the Issuing Bank , and Salomon
Brothers Inc is hereby appointed to act as Syndication Agent on behalf of the
Lenders and the Issuing Bank (for purposes of this Article VIII, the
Administrative Agent, the Collateral Agent and the Syndication Agent are
referred to collectively as the "Agents"). Each of the Lenders and each
subsequent holder of any Note by its acceptance thereof, hereby irrevocably
authorizes the Agents to take such actions on behalf of such Lender or holder or
the Issuing Bank and to exercise such powers as are specifically delegated to
the Agents by the terms and provisions hereof and of the other Credit Documents,
together with such actions and powers as are reasonably incidental thereto. The
Administrative Agent is hereby expressly authorized by the Lenders and the
Issuing Bank, without hereby limiting any implied authority, (a) to receive on
behalf of the Lenders and the Issuing Bank all payments of principal of and
interest on the Loans, all payments in respect of L/C Disbursements and all
other amounts due to the Lenders hereunder, and promptly to distribute to each
Lender or the Issuing Bank its proper share of each payment so received; (b) to
give notice on behalf of each of the Lenders to the Borrower of any Event of
Default specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and other
materials delivered by the Borrower or any other Credit Party pursuant to this
Agreement or the other Credit Documents as received by the Administrative Agent.
Without limiting the generality of the foregoing, the Agents are hereby
expressly authorized to execute any and all documents (including releases) with
respect to the Collateral and the rights of the Secured Parties with respect
thereto, as contemplated by and in accordance with the provisions of this
Agreement and the Security Documents.
SECTION 8.02. Limitations on Liabilities. Neither the Agents nor any
of their respective directors, officers, employees or agents shall be liable as
such for any action taken or omitted by any of them except for its or his own
gross negligence or wilful misconduct, or be responsible for any statement,
warranty or representation herein or the contents of any document delivered in
connection herewith, or be required to ascertain or to make any inquiry
concerning the performance or observance by the Borrower or any other Credit
Party of any of the terms, conditions, covenants or agreements contained in any
Credit Document. The Agents shall not be responsible to the Lenders or the
holders of the Notes for the due execution, genuineness, validity,
enforceability or effectiveness of this Agreement, the Notes or any other Credit
Documents, instruments or agreements. The Administrative Agent may deem and
treat the payee of any Note as the owner thereof for all purposes hereof until
it shall have received from the payee of such Note notice, given as provided
herein, of the transfer thereof in compliance with Section 9.04. The Agents
shall in all cases be fully protected in acting, or refraining from acting, in
accordance
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Exhibit 10.1
with written instructions signed by the Required Lenders and, except as
otherwise specifically provided herein, such instructions and any action or
inaction pursuant thereto shall be binding on all the Lenders and each
subsequent holder of any Note. Each Agent shall, in the absence of knowledge to
the contrary, be entitled to rely on any instrument or document believed by it
in good faith to be genuine and correct and to have been signed or sent by the
proper person or persons. Neither the Agents nor any of their respective
directors, officers, employees or agents shall have any responsibility to the
Borrower or any other Credit Party on account of the failure of or delay in
performance or breach by any Lender or the Issuing Bank of any of its
obligations hereunder or to any Lender or the Issuing Bank on account of the
failure of or delay in performance or breach by any other Lender or the Issuing
Bank or the Borrower or any other Credit Party of any of their respective
obligations hereunder or under any other Credit Document or in connection
herewith or therewith. Each of the Agents may execute any and all duties
hereunder by or through agents or employees and shall be entitled to rely upon
the advice of legal counsel selected by it with respect to all matters arising
hereunder and shall not be liable for any action taken or suffered in good faith
by it in accordance with the advice of such counsel.
SECTION 8.03. Acting at the Direction of the Required Lenders. The
Lenders hereby acknowledge that neither Agent shall be under any duty to take
any discretionary action permitted to be taken by it pursuant to the provisions
of this Agreement unless it shall be requested in writing to do so by the
Required Lenders.
SECTION 8.04. Resignation of the Administrative Agent or the
Collateral Agent. Subject to, and effective upon, the appointment and acceptance
of a successor Agent as provided below, either Agent may resign at any time by
notifying the Lenders and the Borrower. Upon any such resignation, the Required
Lenders shall have the right to appoint a successor. If no successor shall have
been so appointed by the Required Lenders (subject, so long as no Event of
Default has occurred and is continuing, to the consent of the Borrower, which
consent shall not be unreasonably withheld or delayed) and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent which shall be a bank with an office in New York, New York,
having a combined capital and surplus of at least $500,000,000 or an Affiliate
of any such bank. Upon the acceptance of any appointment as Agent hereunder by a
successor bank, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent and the retiring
Agent shall be discharged from its duties and obligations hereunder. After the
Agent's resignation hereunder, the provisions of this Article and Section 9.05
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
SECTION 8.05. Other Transactions. With respect to the Loans made by
it hereunder and the Notes issued to it, each Agent in its individual capacity
and not as Agent shall have the same rights and powers as any other Lender and
may exercise the same as though it were not an Agent, and the Agents and their
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with Holding, the Borrower or any Subsidiary or other Affiliate
thereof as if it were not an Agent.
SECTION 8.06. Reimbursement and Indemnity. Each Lender agrees (a) to
reimburse the Agents, on demand, in the amount of its pro rata share (based on
its Commitments hereunder) of any expenses incurred for the benefit of the
Lenders by the Agents, including
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Exhibit 10.1
counsel fees (including the allocated costs of in-house legal counsel) and
compensation of agents and employees paid for services rendered on behalf of the
Lenders, that shall not have been reimbursed by the Borrower and (b) to
indemnify and hold harmless each Agent and any of its directors, officers,
employees or agents, on demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by or asserted against it in
its capacity as Agent or any of them in any way relating to or arising out of
this Agreement or any other Credit Document or any action taken or omitted by it
or any of them under this Agreement or any other Credit Document, to the extent
the same shall not have been reimbursed by the Borrower or any other Credit
Party, provided that no Lender shall be liable to an Agent or any such other
indemnified person for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of such
Agent or any of its directors, officers, employees or agents. Each Revolving
Credit Lender agrees to reimburse each the Issuing Bank and its directors,
employees and agents, in each case, to the same extent and subject to the same
limitations as provided above for the Agents.
SECTION 8.07. No Reliance. Each Lender acknowledges that it has,
independently and without reliance upon the Agents or any other Lender and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agents or
any other Lender and based on such documents and information as it shall from
time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement or any other Credit
Document, any related agreement or any document furnished hereunder or
thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to the Borrower or Holding, to it at 00000 Xxxx Xxxx, X.X. Xxx
0000, Xxxxxxxx, XX 00000-0000, Attention of Chief Financial Officer (telecopy:
909-694-1225) with a copy to Xxxxxxx Xxxxxx & Co. Incorporated, 00000 Xxxxx
Xxxxxx Xxxxxxxxx, Xxx Xxxxxxx, XX 00000, Attention of Xxx Xxxxx (telecopy:
310-444-1870);
(b) if to the Administrative Agent with respect to notices under
Article II, to Deutsche Bank Trust Company Americas, 000 Xxxxxxx Xx., 00xx
Xxxxx, Xxx Xxxx, XX 00000, Attention of Xxxxxx Xxxx, Deal Administrator
(telephone: 000-000-0000), (telecopy: 212-250-6029);
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Exhibit 10.1
(c) if to the Administrative Agent with respect to other matters, to
Deutsche Bank Trust Company Americas, 000 Xxxxx Xxxxx Xxx., Xxxxx 00, Xxx
Xxxxxxx, XX 00000, Attention of Xxx Xxxx, Principal (telephone: 000-000-0000),
(telecopy: 213-620-8484); and
(d) if to a Lender, to it at its address (or telecopy number) set
forth on Annex 2 or in the Assignment and Acceptance pursuant to which such
Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section or in accordance with the
latest unrevoked direction from such party given in accordance with this
Section.
SECTION 9.02. Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrower or Holding herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Credit Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
making by the Lenders of the Loans, the issuance of Letters of Credit by the
Issuing Bank and the execution and delivery to the Lenders of the Notes
evidencing such Loans, regardless of any investigation made by the Lenders or
the Issuing Bank or on their behalf, and shall continue in full force and effect
as long as the principal of or any accrued interest on any Loan or any Fee or
any other amount payable under this Agreement or any other Credit Document is
outstanding and unpaid or any Letter of Credit is outstanding and so long as the
Commitments have not been terminated. The provisions of Sections 2.14, 2.16,
2.20 and 9.05 shall remain operative and in full force and effect regardless of
the expiration of the term of this Agreement, the consummation of the
transactions contemplated hereby, the repayment of any of the Loans, the
expiration of the Commitments, the expiration of any Letter of Credit, the
invalidity or unenforceability of any term or provision of this Agreement or any
other Credit Document, or any investigation made by or on behalf of the
Administrative Agent, the Collateral Agent, any Lender or the Issuing Bank.
SECTION 9.03. Effectiveness; Termination. This Agreement shall become
effective when it shall have been executed by the Borrower, Holding and the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and
assigns. This Agreement shall remain in effect and until the Commitments have
been terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Credit Document shall have been paid
in full and all Letters of Credit have been cancelled or have expired and all
amounts drawn thereunder have been reimbursed in full.
SECTION 9.04. Successors and Assigns.
(a) Whenever in this Agreement any of the parties hereto is referred
to, such reference shall be deemed to include the permitted successors and
assigns of such party; and all
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Exhibit 10.1
covenants, promises and agreements by or on behalf of the Borrower, Holding, the
Administrative Agent, the Issuing Bank or the Lenders that are contained in this
Agreement shall bind and inure to the benefit of their respective successors and
assigns.
(b) Each Lender may assign to one or more assignees all or a portion
of its interests, rights and obligations under this Agreement (including all or
a portion of its Commitment and the Loans at the time owing to it and the Notes
held by it); provided, however, that
(x) the Borrower and the Administrative Agent and (only with respect
to Revolving Credit Commitments and Revolving Credit Loans) the Swingline
Lender and the Issuing Bank must give their prior written consent to such
assignment (which consent shall not be unreasonably withheld), except in
the case of an assignment to a Lender or an Affiliate of such Lender of any
Loan or Note (when no consent of any party is required), or at any time
when an Event of Default has occurred and is continuing (when no consent of
the Borrower is required),
(y) (i) the amount of the Commitment of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 (or, if less, the
entire remaining amount of such Lender's Commitment), (ii) unless otherwise
approved by Administrative Agent in its sole discretion, each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Lender's rights and obligations with respect to the Revolving
Credit Commitments and/or the Term Loans, (iii) the parties to each such
assignment shall execute and deliver to the Administrative Agent an
Assignment and Acceptance, together with the Note or Notes subject to such
assignment and a processing and recordation fee of $3,500 and (iv) the
assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire. Upon acceptance and recording
pursuant to clause (e) of this Section, from and after the effective date
specified in each Assignment and Acceptance, (A) the assignee thereunder
shall be a party hereto and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement and (B) the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.14, 2.16, 2.20 and 9.05, as well as to any Fees
accrued for its account and not yet paid); and
(z) to the extent that any such assignment is to Xxxxxxx Xxxxxx or
any Affiliate of Xxxxxxx Xxxxxx or is made to a person holding on behalf of
Xxxxxxx Xxxxxx or any Affiliate thereof, such assignment shall have been
approved in writing by Administrative Agent and such holder shall agree in
writing that such holder and any assignee of such holder shall have no
right to consent to any amendment, modification, waiver or supplement
hereto or to otherwise vote in any manner whatsoever with respect to this
Agreement or the other Credit Documents and shall not be entitled to
participate in any
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Exhibit 10.1
conference, discussion or meeting of Lenders or to receive any information
distributed to any other Lender hereunder.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim and that
its Term Loan Commitment and Revolving Credit Commitment, and the outstanding
balances of its Term Loans and Revolving Loans, in each case without giving
effect to assignments thereof which have not become effective, are as set forth
in such Assignment and Acceptance, (ii) except as set forth in clause (i), such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Credit Document or any other instrument or document furnished pursuant
hereto, or the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of its
obligations under this Agreement, any other Credit Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such Assignment and
Acceptance; (iv) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements referred
to in Section 3.05(a) or delivered pursuant to Section 5.04 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (v) such
assignee will independently and without reliance upon the Administrative Agent,
the Collateral Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (vi) such assignee appoints and authorizes the Administrative
Agent and the Collateral Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement as are delegated to the Administrative
Agent and the Collateral Agent, respectively, by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations which by
the terms of this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to 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 pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive and the Borrower, the Administrative Agent, the Issuing Bank, the
Collateral Agent and the Lenders may treat each person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes
of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank, the Collateral Agent
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee together with the Note or Notes
subject to such assignment, an Administrative Questionnaire completed in respect
of the assignee (unless the
101
Exhibit 10.1
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in clause (b) and, if required, the written consent of the
Borrower, the Administrative Agent and (only with respect to Revolving Credit
Commitments and Revolving Credit Loans) the Swingline Lender and the Issuing
Bank to such assignment, the Administrative Agent shall (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Lenders, the Issuing Bank
and the Swingline Lender. No assignment shall be effective unless it has been
recorded in the Register as provided in this clause. Within five Business Days
after receipt of notice, (i) the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent new Notes payable to the order of such
assignee (or, if such assignee shall so request, to such assignee or registered
assigns) representing Loans made pursuant to the Commitments assumed by it or
Term Loans acquired by it, as the case may be, pursuant to such Assignment and
Acceptance and (ii) the assigning Lender, if it shall cease to be a party hereto
as provided in clause (a), shall deliver the Notes held by it to the Borrower
for cancellation. The new Notes delivered to such assignee shall be dated the
date of the original Notes issued hereunder and shall otherwise be in
substantially the form of the appropriate Exhibit or Exhibits thereto.
(f) Each Lender may without the consent of the Borrower, the
Swingline Lender, the Issuing Bank or the Administrative Agent sell
participations to one or more banks or other entities in all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it and the Notes held by it); provided,
however, that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) the participating banks or
other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.14, 2.16 and 2.20 to the same extent as if
they were Lenders and (iv) the Borrower, the Administrative Agent, the Issuing
Bank and the Lenders shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement,
and such Lender shall retain the sole right to enforce the obligations of the
Borrower relating to the Loans or L/C Disbursements and to approve any
amendment, modification or waiver of any provision of this Agreement (other than
amendments, modifications or waivers which extend the final scheduled maturity
of any Loan, Note or Letter of Credit (unless such Letter of Credit is not
extended beyond the Maturity Date) in which such participant is participating,
or reduce the rate or extend the time of payment of interest or Fees thereon
(except in connection with a waiver of applicability of any post-default
increase in interest amounts) or reduce the principal amount thereof, or
increase the amount of the participant's participation over the amount thereof
then in effect (provided that a waiver of any Default or of a mandatory
reduction in the Commitment shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant's participation is not
increased thereby), or consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement).
(g) Any Lender or participant may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall agree (subject to
customary exceptions) to
102
Exhibit 10.1
preserve the confidentiality of such confidential information on terms no less
restrictive than those applicable to the Lenders pursuant to Section 9.16.
(h) Any Lender may at any time assign all or any portion of its
rights under this Agreement and the Notes issued to it to a Federal Reserve Bank
to secure extensions of credit by such Federal Reserve Bank to such Lender;
provided that no such assignment shall release a Lender from any of its
obligations hereunder or substitute any such Bank for such Lender as a party
hereto.
(i) Neither Holding nor the Borrower shall assign or delegate any of
its rights or duties hereunder without the prior written consent of the
Administrative Agent, the Issuing Bank and each Lender, and any attempted
assignment without such consent shall be null and void.
SECTION 9.05. Expenses; Indemnity.
(a) The Borrower and Holding agree, jointly and severally, to pay all
out-of-pocket expenses incurred by the Administrative Agent, the Collateral
Agent, the Issuing Bank and the Swingline Lender in connection with the
syndication of the credit facilities provided for herein and the preparation and
administration of this Agreement and the other Credit Documents or in connection
with any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the transactions hereby or thereby contemplated shall be
consummated) or incurred by the Administrative Agent, the Collateral Agent or
any Lender in connection with the enforcement or protection of its rights in
connection with this Agreement and the other Credit Documents or in connection
with the Loans made or the Notes or Letters of Credit issued hereunder,
including the fees, charges and disbursements of O'Melveny & Xxxxx LLP, counsel
for the Administrative Agent and the Collateral Agent, and, in connection with
any such enforcement or protection, the fees, charges and disbursements of any
other counsel for the Administrative Agent, the Collateral Agent or any Lender
(including the allocated costs of in-house legal counsel).
(b) The Borrower and Holding agree, jointly and severally, to
indemnify the Administrative Agent, the Collateral Agent, each Lender and the
Issuing Bank, each Affiliate of any of the foregoing persons and each of their
respective directors, officers, employees and agents (each such person being
called an "Indemnitee") against, and to hold each Indemnitee harmless from, any
and all losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees (including the allocated costs of in-house legal
counsel), charges and disbursements, incurred by or asserted against any
Indemnitee arising out of, in any way connected with, or as a result of (i) the
execution or delivery of this Agreement or any other Credit Document or any
agreement or instrument contemplated thereby, the performance by the parties
thereto of their respective obligations thereunder or the consummation of the
Transactions and the other transactions contemplated thereby, (ii) the use of
the proceeds of the Loans or issuance of Letters of Credit, (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, or (iv) any actual or alleged
presence or Release of Hazardous Materials on any property owned or operated by
the Borrower or any of the Subsidiaries, or any Environmental Claim related in
any way to the Borrower or the Subsidiaries; provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or
103
Exhibit 10.1
wilful misconduct of such Indemnitee. Borrower and Holding hereby agree that no
Indemnitee shall be liable for any indirect or consequential damages.
(c) The provisions of this Section shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of the Commitments, the expiration of any Letter of
Credit, the invalidity or unenforceability of any term or provision of this
Agreement or any other Credit Document, or any investigation made by or on
behalf of the Administrative Agent, the Collateral Agent, any Lender or the
Issuing Bank. All amounts due under this Section shall be payable on written
demand therefor.
SECTION 9.06. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and any Affiliate of such Lender is
hereby authorized at any time and from time to time, except to the extent
prohibited by law (other than as to any requirement as to mutuality), 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 Affiliate of such Lender to or for the credit or the account of
the Borrower or Holding or any Credit Party or any Affiliate of any Credit Party
against any of and all the obligations of the Borrower or Holding or any Credit
Party or any Affiliate of any Credit Party now or hereafter existing under this
Agreement and other Credit Documents held by such Lender or any Affiliate of
such Lender, irrespective of whether or not such Lender or any Affiliate of such
Lender shall have made any demand under this Agreement or such other Credit
Document and although such obligations may be unmatured. The rights of each
Lender or any Affiliate of such Lender under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
or any Affiliate of such Lender may have.
SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER CREDIT
DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER
CREDIT DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500 (THE "UNIFORM CUSTOMS") AND, AS TO MATTERS NOT
GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.08. Waivers; Amendment.
(a) No failure or delay of the Administrative Agent, the Collateral
Agent, any Lender or the Issuing Bank in exercising any power or right hereunder
or under any other Credit Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Collateral Agent, the Issuing Bank
and the Lenders hereunder and under the other Credit Documents are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.
No waiver of any provision of this
104
Exhibit 10.1
Agreement or any other Credit Document or consent to any departure by the
Borrower or any other Credit Party therefrom shall in any event be effective
unless the same shall be permitted by clause (b), and then such waiver or
consent shall be effective only in the specific instance and for the purpose for
which given. No notice or demand on the Borrower or Holding in any case shall
entitle the Borrower or Holding to any other or further notice or demand in
similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower, Holding and the Required Lenders; provided,
however, that no such agreement shall (i) decrease the principal amount of, or
extend the maturity of or any scheduled principal payment date or date for the
payment of any interest on any Loan or any date for reimbursement of an L/C
Disbursement, or waive or excuse any such payment or any part thereof, or
decrease the rate of interest on any Loan or L/C Disbursement, without the prior
written consent of each holder of a Note affected thereby, (ii) change or extend
the Commitment or decrease or extend the date for payment of the Commitment Fees
of any Lender without the prior written consent of such Lender or (iii) amend or
modify the provisions of Section 2.17 or 9.04(i), the provisions of this
Section, the definition of the term "Required Lenders" or release any Guarantor
or all or substantially all of the Collateral, without the prior written consent
of each Lender; provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent, the
Collateral Agent, the Issuing Bank or the Swingline Lender hereunder or under
any other Credit Document without the prior written consent of the
Administrative Agent, the Collateral Agent, the Issuing Bank or the Swingline
Lender. Each Lender and each holder of a Note shall be bound by any waiver,
amendment or modification authorized by this Section regardless of whether its
Note shall have been marked to make reference thereto, and any consent by any
Lender or holder of a Note pursuant to this Section shall bind any person
subsequently acquiring a Note from it, whether or not such Note shall have been
so marked.
(c) If a Lender refuses to consent to a proposed change, waiver,
discharge or termination with respect to this Agreement which requires the
consent of all of the Lenders and has been approved by the Required Lenders, the
Borrower shall have the right for a 60 day period following such refusal, to
replace such Lender (a "Replaced Lender") with one or more assignees permitted
pursuant to Section 9.04 (collectively, the "Replacement Lender") acceptable to
Administrative Agent, provided that
(i) at the time of any replacement pursuant to this clause, the
Replacement Lender and Replaced Lender shall enter into one or more
Assignment and Acceptances pursuant to Section 9.04(b) (and with all fees
payable pursuant to Section 9.04(b) to be paid by the Replacement Lender)
pursuant to which the Replacement Lender shall acquire all of the
outstanding Loans and Commitments (including principal, interest and
Commitment Fees) of, and in each case participations in Letters of Credit
and Swingline Loans by, the Replaced Lender,
(ii) the Replacement Lender shall pay to the Replaced Lender in
respect thereof an amount equal to the sum of (A) an amount equal to the
principal of, and all unpaid interest on, all outstanding Loans of the
Replaced Lender, and all unpaid Commitment Fees payable to the Replaced
Lender, (B) an amount equal to all unpaid drawings with respect to Letters
of Credit that have been funded by (and not reimbursed to) such
105
Exhibit 10.1
Replaced Lender, together with all unpaid interest thereon, (C) an amount
equal to such Replaced Lender's funded participations in any Swingline
Loans, and (D) an amount equal to all unpaid fees owing to the Replaced
Lender with respect thereto,
(iii) the Replacement Lender shall pay to the appropriate Issuing Bank
an amount equal to such Replaced Lender's Applicable Percentage of any
unpaid drawings with respect to Letters of Credit issued by it to the
extent such amount was not theretofore funded by such Replaced Lender,
(iv) the Replacement Lender shall pay to the Swingline Lender an
amount equal to the unfunded amount of any participation of the Replaced
Lender in a Swingline Loan which is required to be funded, and
(v) all obligations of the Borrower owing to the Replaced Lender
other than principal, interest and Commitment Fees, shall be paid in full
to such Replaced Lender concurrently with such replacement.
Upon the execution of the respective Assignment and Acceptance, recordation of
such assignment in the Register by Administrative Agent, and the payment of
foregoing amounts, the Replacement Lender shall become a Lender hereunder and
the Replaced Lender shall cease to constitute a Lender hereunder except with
respect to indemnification provisions under this Agreement which by the terms of
this Agreement survive the termination of this Agreement, which indemnification
provisions shall survive as to such Replaced Lender. Notwithstanding anything to
the contrary contained above, no Issuing Bank may be replaced hereunder at any
time while it has Letters of Credit outstanding hereunder unless arrangements
satisfactory to such Issuing Bank (including the furnishing of a standby letter
of credit in form and substance, and issued by an issuer satisfactory to such
Issuing Bank or the furnishing of cash collateral in amounts and pursuant to
arrangements satisfactory to such Issuing Bank) have been made with respect to
such outstanding Letters of Credit.
SECTION 9.09. Interest Rate Limitation. Notwithstanding anything
herein or in the Notes to the contrary, if at any time the interest rate
applicable to any Loan or participation in any L/C Disbursement, together with
all fees, charges and other amounts which are treated as interest on such Loan
or participation in such L/C Disbursement under applicable law (collectively the
"Charges"), shall exceed the maximum lawful rate (the "Maximum Rate") which may
be contracted for, charged, taken, received or reserved by the Lender holding
such Loan or participation in accordance with applicable law, the rate of
interest payable in respect of such Loan or participation hereunder or under the
Note held by such Lender, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan or participation
but were not payable as a result of the operation of this Section shall be
cumulated and the interest and Charges payable to such Lender in respect of
other Loans or participations or periods shall be increased (but not above the
Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Effective Rate to the date of repayment, shall have
been received by such Lender.
SECTION 9.10. Entire Agreement. This Agreement, the Fee Letter and
the other Credit Documents constitute the entire contract between the parties
relative to the subject matter
106
Exhibit 10.1
hereof. Any other previous agreement among the parties with respect to the
subject matter hereof is superseded by this Agreement and the other Credit
Documents. Nothing in this Agreement or in the other Credit Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Credit Documents.
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION.
SECTION 9.12. Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Credit Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being understood that
the invalidity of a particular provision in a particular jurisdiction shall not
in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 9.13. Counterparts. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together shall
constitute a single contract, and shall become effective as provided in Section
9.03. Delivery of an executed signature page to this Agreement by telecopy
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.
SECTION 9.14. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 9.15. Jurisdiction; Consent to Service of Process.
(a) Each of Holding and the Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or Federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement or the
other Credit Documents, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that
all claims in respect of any such
107
Exhibit 10.1
action or proceeding may be heard and determined in such New York State or, to
the extent permitted by law, in such Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, the Collateral Agent, the Issuing Bank or
any Lender may otherwise have to bring any action or proceeding relating to this
Agreement or the other Credit Documents against the Borrower, Holding or their
respective properties in the courts of any jurisdiction.
(b) Each of Holding and the Borrower hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
the other Credit Documents in any New York State or Federal court. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.16. Confidentiality. The Administrative Agent, the
Collateral Agent, the Issuing Bank and each of the Lenders agrees to keep
confidential (and to use its best efforts to cause its respective agents and
representatives to keep confidential) the Information (as defined below) and all
copies thereof, extracts therefrom and analyses or other materials based
thereon, except that the Administrative Agent, the Collateral Agent, the Issuing
Bank or any Lender shall be permitted to disclose Information (a) to such of its
respective officers, directors, employees, agents, affiliates and
representatives as need to know such Information, (b) to the extent requested by
any regulatory authority, (c) to the extent otherwise required by applicable
laws and regulations or by any subpoena or similar legal process, (d) in
connection with any suit, action or proceeding relating to the enforcement of
its rights hereunder or under the other Credit Documents or (e) to the extent
such Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Administrative Agent,
the Issuing Bank, any Lender or the Collateral Agent on a nonconfidential basis
from a source other than the Borrower or Holding. For the purposes of this
Section, "Information" means all financial statements, certificates, reports,
agreements and information (including all analyses, compilations and studies
prepared by the Administrative Agent, the Collateral Agent, the Issuing Bank or
any Lender based on any of the foregoing) that are received from the Borrower or
Holding and related to the Borrower or Holding, any shareholder of the Borrower
or Holding or any employee, customer or supplier of the Borrower or Holding,
other than any of the foregoing that were available to the Administrative Agent,
the Collateral Agent, the Issuing Bank or any Lender on a nonconfidential basis
prior to its disclosure thereto by the Borrower or Holding, and which are in the
case of Information provided after the Closing Date, clearly identified at the
time of delivery as confidential. The provisions of this Section shall remain
operative and in full force and effect until the second anniversary of the
termination of this Agreement.
108
Exhibit 10.1
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
XXXXXX RESPIRATORY CARE INC.
by /s/ Xxxxxxx X. Xxxxx
------------------------
Name: Xxxxxxx X. Xxxxx
Title: CFO
RIVER HOLDING CORP.
by /s/ Xxxxxxx X. Xxxxx
------------------------
Name: Xxxxxxx X. Xxxxx
Title: CFO
DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Administrative
Agent, Collateral Agent,
Swingline Lender and Issuing
Bank
by /s/ Xxxxxxx Xxxxxxx
------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
S-1
Exhibit 10.1
LENDERS
DEUTSCHE BANK TRUST COMPANY
AMERICAS
by /s/ Xxxxxxx Xxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
BANK OF AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
by /s/ Xxxxx X. Xxxxxx
----------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
by /s/ Dister H. Bochoter
----------------------------
Name: Dister X. Xxxxxxx
Title: Jr. V.P.
BANK OF AMERICA, N.A.
by /s/ Xxxxx Xxxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
by /s/ Xxx Xxxxx
----------------------------
Name: Xxx Xxxxx
Title: Vice President
S-2
Exhibit 10.1
PB CAPITAL CORPORATION
by /s/ Xxxxx X. Xxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
by /s/ Xxxxxxxxxxx X. Xxxxx
----------------------------
Name: Xxxxxxxxxxx X. Xxxxx
Title: Vice President
CITICORP USA, INC.
by /s/ Xxxxx XxXxxxxxx
----------------------------
Name: Xxxxx XxXxxxxxx
Title: Attorney-in-Fact
IMPERIAL BANK
by /s/ Xxxxxx X. Xxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
ROYAL BANK OF CANADA
by /s/ Xxxxx Xxx
----------------------------
Name: Xxxxx Xxx
Title: Manager
SOCIETE GENERALE
by /s/ Xxxxxxx Xxxxxx
----------------------------
Name: Xxxxxxx Xxxxxx
Title: Director
S-3
Exhibit 10.1
XXXXX FARGO BANK, N.A.
by /s/
----------------------------
Name:
Title:
S-4
Exhibit 10.1
ANNEX 1
REVOLVING CREDIT COMMITMENTS AND TERM LOAN COMMITMENTS
------------------------------------------------------------------------------------------------------------------------
Working Capital Term Loan
Lender Acquisition Loans Commitments Commitment
------------------------------------------------------------------------------------------------------------------------
Deutsche Bank Trust Company Americas
(f/k/a Bankers Trust Company) $ 2,959,183.67 $ 1,109,693.88 $ 739,795.92
------------------------------------------------------------------------------------------------------------------------
Bank of America, N.A. 8,000,000.00 3,000,000.00 2,000,000.00
------------------------------------------------------------------------------------------------------------------------
Bank Austria Creditanstalt Corporate
Finance, Inc. 4,000,000.00 1,500,000.00 1,000,000.00
------------------------------------------------------------------------------------------------------------------------
Bank of Tokyo-Mitsubishi Trust Company 4,000,000.00 1,500,000.00 1,000,000.00
------------------------------------------------------------------------------------------------------------------------
Citicorp USA, Inc. 5,000,000.00 1,875,000.00 1,250,000.00
------------------------------------------------------------------------------------------------------------------------
Imperial Bank 2,040,816.33 765,306.12 510,204.08
------------------------------------------------------------------------------------------------------------------------
PB Capital Corporation 3,000,000.00 1,125,000.00 750,000.00
------------------------------------------------------------------------------------------------------------------------
Royal Bank of Canada 3,000,000.00 1,125,000.00 750,000.00
------------------------------------------------------------------------------------------------------------------------
Societe Generale 4,000,000.00 1,500,000.00 1,000,000.00
------------------------------------------------------------------------------------------------------------------------
Xxxxx Fargo Bank, N.A. 4,000,000.00 1,500,000.00 1,000,000.00
------------------------------------------------------------------------------------------------------------------------
Total $40,000,000.00 $15,000,000.00 $10,000,000.00
------------------------------------------------------------------------------------------------------------------------
Annex 1-1
Exhibit 10.1
ANNEX 2
ADMINISTRATIVE INFORMATION
Annex 2-1
Exhibit 10.1
ANNEX 3
DESCRIPTION OF THE RECAPITALIZATION
1. Xxxxxxx Xxxxxx has caused a Delaware corporation ("Holdings") to be
formed.
2. Xxxxxxx Xxxxxx will make an equity contribution of at least $55,000,000
to Holdings (of which no more than $30,000,000 is to be in the form of
preferred equity issued upon terms acceptable to Salomon Brothers
Holding Company Inc, Salomon Brothers Inc and the Administrative Agent
(the "Holdings Preferred Equity")), and certain members of the
Borrower's management (the "Management Investors"), will make an equity
contribution of at least $6,500,000 (in exchange for common stock) to
Holdings (for a total of at least $91,500,000 of equity contributions
(such common equity and preferred equity investments in such amounts
being the "Equity Investment")). All the outstanding common stock of
Holdings will be held by Xxxxxxx Xxxxxx, certain affiliates thereof and
the Management Investors (collectively, the "Investors").
3. Holdings has caused River Acquisition Corp., a Delaware corporation
("Acquisition Corp."), to be formed, and will make a capital
contribution in an aggregate cash amount equal to the Equity Investment
(and not less than $91,500,000) to Acquisition Corp. in exchange for
100% of the capital stock of Acquisition Corp. (of which not more than
$30,000,000 is to be in the form of preferred equity substantially
similar to the Holdings Preferred Equity).
4. Acquisition Corp. will make a capital contribution of an aggregate cash
amount equal to the Equity Investment (and not less than $91,500,000)
to the Borrower (collectively with the contributions referred to in
clause (b) and (c) above, the "Equity Contributions") in exchange for a
number (to be determined) of newly issued shares of the Borrower (of
which not more than $30,000,000 is to be in the form of preferred
equity substantially similar to the Holdings Preferred Equity).
5. The Borrower will obtain new senior secured credit facilities in an
aggregate principal amount of up to $100,000,000 (the "Senior
Facilities").
6. The Borrower will issue $115,000,000 in aggregate principal amount of
its senior subordinated notes in a Rule 144A or other private placement
(the "Senior Subordinated Notes").
7. The Borrower will apply the Equity Contributions and the proceeds of
the Senior Facilities and the Senior Subordinated Notes to redeem a
certain number of shares of the Borrower (to be determined) held by
Xxxxx Xxxxxx Xxxxxx and certain affiliated parties (collectively, the
"Current Owner") by means of a recapitalization dividend in an amount,
based on the Equity Investment and the Equity Contribution
Annex 3-1
Exhibit 10.1
received by the Borrower, of not more than $225,000,000 (the
"Redemption Amount") payable to the Current Owner.
8. The Current Owner will contribute all of her shares of Industrias
Xxxxxx X.X. de C.V. to the Borrower.
9. The Indebtedness to be Paid will be repaid in full.
10. The Transaction Costs will be paid.
11. Acquisition Corp. will then merge with and into the Borrower (the
"Merger"), in a transaction structured such that (i) the Borrower
remains as the surviving entity of the Merger, and (ii) upon
consummation of the Merger, approximately 80.4% of the outstanding
capital stock of the Borrower will be held by Holdings and
approximately 19.6% of the outstanding capital stock of the Borrower
will be held by the Current Owner, based on the Equity Investment
described above.
Annex 3-2
Exhibit 10.1
ANNEX 4
GIBECK AB ACQUISITION
1. The Borrower will cause a holding company (together with its
successors, "US Holdco") to be formed under the laws of a state of the
United States, and a holding company (together with its successors,
"Euro Holdco") to be formed under the laws of a European Economic Union
member nation, each as a wholly-owned direct or indirect Unrestricted
Subsidiary of the Borrower.
2. The Borrower will cause a Swedish acquisition company (together with
its successors, "Swedish Acquisitionco") be formed as an Unrestricted
Subsidiary of the Borrower.
3. Xxxxxxx Xxxxxx will purchase a number of shares of Holding to be
determined for a cash consideration of at least $20,000,000.
4. Holding will use the proceeds of Item 3 to purchase a number of shares
of common stock of the Borrower to be determined.
5. The holders of the Gibeck Family Shares will exchange such shares for a
number of shares of Holding to be determined.
6. Holding will exchange the Gibeck Family Shares for a number of shares
of common stock of the Borrower to be determined.
7. The Borrower will make an Investment in Swedish Acquisitionco (directly
or through US Holdco and/or Euro Holdco) consisting of the proceeds
received in Item 4 and the Gibeck Family Shares received in Item 6.
8. Swedish Acquisitionco will obtain approximately $30,000,000 of
financing. Such financing, together with the Investment by the
Borrower, will be used to acquire all of the shares of Xxxxx Xxxxxx AB,
a Swedish corporation ("Gibeck AB") pursuant to a tender offer (other
than shares of Class A Stock of Gibeck AB held by Xxxx Xxxxxx (such
shares, the "Gibeck Family Shares") .
9. After giving effect to the Gibeck AB Acquisition, US Holdco, Euro
Holdco and Swedish Acquisitionco will be an Unrestricted Subsidiaries
of the Borrower, and Gibeck AB will be a Subsidiary of Swedish
Acquisition. In addition, it is contemplated that the Borrower will
transfer ownership of Swedish Acquisitionco to Euro Holdco as soon as
practicable under applicable tax regulations.
10. The transactions described in this Annex are referred to as the "Gibeck
AB Acquisition".
Annex 4-1