EXHIBIT 4.4.1
CREDIT AND GUARANTY AGREEMENT
DATED AS OF AUGUST 6, 2004
AMONG
STANADYNE CORPORATION,
AS BORROWER,
STANADYNE AUTOMOTIVE HOLDING CORP. AND
CERTAIN SUBSIDIARIES OF STANADYNE CORPORATION,
AS GUARANTORS,
VARIOUS LENDERS,
AND
XXXXXXX XXXXX CREDIT PARTNERS L.P.,
AS SOLE LEAD ARRANGER, SOLE BOOKRUNNER, SYNDICATION AGENT, ADMINISTRATIVE
AGENT AND COLLATERAL AGENT,
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$65,000,000 SENIOR SECURED CREDIT FACILITY
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS AND INTERPRETATION....................................................................... 2
1.1. Definitions..................................................................................... 2
1.2. Accounting Terms................................................................................ 29
1.3. Interpretation, etc............................................................................. 30
SECTION 2. LOANS ............................................................................................... 31
2.1. Term Loans...................................................................................... 31
2.2. Repayment....................................................................................... 31
2.3. Pro Rata Shares; Availability of Funds.......................................................... 32
2.4. Use of Proceeds................................................................................. 32
2.5. Evidence of Debt; Register; Lenders' Books and Records; Notes................................... 33
2.6. Interest on Loans............................................................................... 33
2.7. Conversion/Continuation......................................................................... 35
2.8. Default Interest................................................................................ 35
2.9. Fees............................................................................................ 35
2.10. Voluntary Prepayments/Call Protection.......................................................... 36
2.11. Mandatory Prepayments/Commitment Reductions.................................................... 37
2.12. Application of Prepayments/Reductions.......................................................... 39
2.13. General Provisions Regarding Payments.......................................................... 39
2.14. Ratable Sharing................................................................................ 41
2.15. Making or Maintaining Eurodollar Rate Loans.................................................... 41
2.16. Increased Costs; Capital Adequacy.............................................................. 43
2.17. Taxes; Withholding, etc........................................................................ 45
2.18. Obligation to Mitigate......................................................................... 47
2.19. Removal or Replacement of a Lender............................................................. 47
SECTION 3. CONDITIONS PRECEDENT................................................................................. 48
3.1. Closing Date.................................................................................... 48
3.2. Further Conditions to All Term Loans............................................................ 54
SECTION 4. REPRESENTATIONS AND WARRANTIES....................................................................... 55
4.1. Organization; Requisite Power and Authority; Qualification...................................... 55
4.2. Capital Stock and Ownership..................................................................... 55
4.3. Due Authorization............................................................................... 55
4.4. No Conflict..................................................................................... 55
4.5. Governmental Consents........................................................................... 56
4.6. Binding Obligation.............................................................................. 56
4.7. Historical Financial Statements................................................................. 56
4.8. Projections..................................................................................... 56
4.9. No Material Adverse Change...................................................................... 57
4.10. No Restricted Junior Payments.................................................................. 57
4.11. Adverse Proceedings, etc....................................................................... 57
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4.12. Payment of Taxes............................................................................... 57
4.13. Properties..................................................................................... 57
4.14. Environmental Matters.......................................................................... 58
4.15. No Defaults.................................................................................... 59
4.16. Material Contracts............................................................................. 59
4.17. Governmental Regulation........................................................................ 59
4.18. Margin Stock................................................................................... 59
4.19. Employee Matters............................................................................... 59
4.20. Employee Benefit Plans......................................................................... 60
4.21. Certain Fees................................................................................... 60
4.22. Solvency....................................................................................... 60
4.23. Related Agreements............................................................................. 60
4.24. Compliance with Statutes, etc.................................................................. 61
4.25. Disclosure..................................................................................... 61
4.26. Subordination; Designation of the Credit Documents as "Designated Senior Indebtedness";
Etc............................................................................................ 61
SECTION 5. AFFIRMATIVE COVENANTS................................................................................ 62
5.1. Financial Statements and Other Reports.......................................................... 62
5.2. Existence....................................................................................... 66
5.3. Payment of Taxes and Claims..................................................................... 66
5.4. Maintenance of Properties....................................................................... 67
5.5. Insurance....................................................................................... 67
5.6. Inspections..................................................................................... 67
5.7. Lenders Meetings................................................................................ 68
5.8. Compliance with Laws............................................................................ 68
5.9. Environmental................................................................................... 68
5.10. Subsidiaries................................................................................... 70
5.11. Additional Material Real Estate Assets......................................................... 70
5.12. Interest Rate Protection....................................................................... 71
5.13. Further Assurances............................................................................. 71
5.14. Cash Management Systems........................................................................ 71
5.16. Post-Closing Obligations....................................................................... 71
5.18. ............................................................................................... 72
SECTION 6. NEGATIVE COVENANTS................................................................................... 72
6.1. Indebtedness.................................................................................... 72
6.2. Liens........................................................................................... 74
6.3. Equitable Lien.................................................................................. 76
6.4. No Further Negative Pledges..................................................................... 76
6.5. Restricted Junior Payments...................................................................... 77
6.6. Restrictions on Subsidiary Distributions........................................................ 78
6.7. Investments..................................................................................... 79
6.8. [Reserved]...................................................................................... 80
6.9. Fundamental Changes; Disposition of Assets; Acquisitions........................................ 80
6.10. Disposal of Subsidiary Interests............................................................... 81
6.11. Sales and Lease-Backs.......................................................................... 82
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6.12. Transactions with Shareholders and Affiliates.................................................. 82
6.13. Conduct of Business............................................................................ 82
6.14. Permitted Activities of Holdings............................................................... 82
6.15. Amendments or Waivers of Certain Related Agreements............................................ 83
6.16. Amendments or Waivers with respect to Subordinated Indebtedness................................ 83
6.17. Fiscal Year.................................................................................... 83
6.18. No Other "Designated Senior Indebtedness"...................................................... 83
SECTION 7. GUARANTY............................................................................................. 83
7.1. Guaranty of the Obligations..................................................................... 83
7.2. Contribution by Guarantors...................................................................... 84
7.3. Payment by Guarantors........................................................................... 84
7.4. Liability of Guarantors Absolute................................................................ 85
7.5. Waivers by Guarantors........................................................................... 87
7.6. Guarantors' Rights of Subrogation, Contribution, etc............................................ 88
7.7. Subordination of Other Obligations.............................................................. 89
7.8. Continuing Guaranty............................................................................. 89
7.9. Authority of Guarantors or Borrower............................................................. 89
7.10. Financial Condition of Borrower and Guarantors................................................. 89
7.11. Bankruptcy, etc................................................................................ 90
7.12. Discharge of Guaranty Upon Sale of Guarantor................................................... 90
SECTION 8. EVENTS OF DEFAULT.................................................................................... 91
8.1. Events of Default............................................................................... 91
SECTION 9. AGENTS .............................................................................................. 93
9.1. Appointment of Agents........................................................................... 93
9.2. Powers and Duties............................................................................... 94
9.3. General Immunity................................................................................ 94
9.4. Agents Entitled to Act as Lender................................................................ 95
9.5. Lenders' Representations, Warranties and Acknowledgment......................................... 96
9.6. Right to Indemnity.............................................................................. 96
9.7. Successor Administrative Agent and Collateral Agent............................................. 97
9.8. Collateral Documents and Guaranty............................................................... 97
SECTION 10. MISCELLANEOUS....................................................................................... 98
10.1. Notices........................................................................................ 98
10.2. Expenses....................................................................................... 98
10.3. Indemnity...................................................................................... 99
10.4. Set-Off........................................................................................ 100
10.5. Amendments and Waivers......................................................................... 100
10.6. Successors and Assigns; Participations......................................................... 101
10.7. Independence of Covenants...................................................................... 105
10.8. Survival of Representations, Warranties and Agreements......................................... 105
10.9. No Waiver; Remedies Cumulative................................................................. 105
10.10. Marshalling; Payments Set Aside............................................................... 105
10.11. Severability.................................................................................. 105
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10.12. Obligations Several; Independent Nature of Lenders' Rights.................................... 106
10.13. Headings...................................................................................... 106
10.14. APPLICABLE LAW................................................................................ 106
10.15. CONSENT TO JURISDICTION....................................................................... 106
10.16. WAIVER OF JURY TRIAL.......................................................................... 106
10.17. Confidentiality............................................................................... 107
10.18. Usury Savings Clause.......................................................................... 108
10.19. Counterparts.................................................................................. 108
10.20. Effectiveness................................................................................. 108
10.21. USA Patriot Act............................................................................... 108
10.22. Electronic Execution of Assignments........................................................... 108
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APPENDICES: A Commitments
B Notice Addresses
SCHEDULES: 1.1(a) Certain Adjustments to Financial Covenant Definitions
1.1(b) Existing Capital Leases
3.1(i) Closing Date Mortgaged Properties
3.1(k) Phase I Report
4.1 Jurisdictions of Organization and Qualification
4.2 Capital Stock and Ownership
4.13 Real Estate Assets
4.14 Certain Environmental Matters
4.17 Material Contracts
4.20 Employee Benefits Plans
5.9 Environmental Disclosure
5.14 Cash Management Systems
5.16 Post-Closing Obligations
6.1 Certain Indebtedness
6.2 Certain Liens
6.7 Certain Investments
6.12 Certain Affiliate Transactions
EXHIBITS: A-1 Funding Notice
A-2 Conversion/Continuation Notice
B Term Loan Note
C Compliance Certificate
D Assignment Agreement
E Certificate Re: Non-bank Status
F-1 Closing Date Certificate
F-2 Solvency Certificate
G Counterpart Agreement
H Mortgage
I Landlord Waiver and Consent Agreement
The Company agrees to furnish supplementally a copy of any omitted schedule or
exhibit to the Commission upon request.
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CREDIT AND GUARANTY AGREEMENT
This CREDIT AND GUARANTY AGREEMENT, dated as of August 6, 2004, is
entered into by and among STANADYNE CORPORATION, a Delaware corporation
("BORROWER"), STANADYNE AUTOMOTIVE HOLDING CORP., a Delaware corporation
("HOLDINGS"), CERTAIN SUBSIDIARIES OF STANADYNE CORPORATION, as Guarantors, the
Lenders party thereto from time to time, and XXXXXXX XXXXX CREDIT PARTNERS L.P.
("GSCP"), as Sole Lead Arranger, Sole Bookrunner, Syndication Agent,
Administrative Agent (together with its permitted successors in such capacity,
"ADMINISTRATIVE AGENT") and Collateral Agent (together with its permitted
successors in such capacity, "COLLATERAL AGENT").
RECITALS:
WHEREAS, capitalized terms used in these Recitals shall have the
respective meanings set forth for such terms in Section 1.1 hereof;
WHEREAS, Holdings owns all of the capital stock of Borrower;
WHEREAS, KSTA Acquisition, LLC has entered into the Stock Purchase
Agreement with the Sellers pursuant to which it has agreed to acquire Holdings;
WHEREAS, Lenders have agreed to extend a senior secured term loan
credit facility to Borrower, consisting of $65.0 million aggregate principal
amount of Term Loans, the proceeds of which will be used, together with the net
cash proceeds of (i) the Sponsor Equity contribution and (ii) the Senior
Subordinated Notes, to repay in full Borrower's Existing Indebtedness
outstanding on the Closing Date, together with the payments of all costs, fees
and expenses in connection with the Acquisition and such repayment;
WHEREAS, concurrently with the Term Loans provided to Borrower on the
Closing Date, Borrower will enter into the Revolving Credit Agreement which will
provide for Revolving Loans for the funding of permitted capital expenditures
and Permitted Acquisitions and to provide for the ongoing working capital
requirements of Borrower following the Acquisition and for general corporate
purposes;
WHEREAS, Borrower has agreed to secure all of its Term Obligations by
granting to Collateral Agent, for the benefit of Term Secured Parties, a First
Priority Lien on its Fixed Collateral and granting a Second Priority Lien on its
Liquid Collateral;
WHEREAS, each Guarantor has agreed to guarantee the obligations of
Borrower hereunder and to secure its Term Obligations by granting to Collateral
Agent, for the benefit of Term Secured Parties, a First Priority Lien on its
Fixed Collateral, and a Second Priority Lien on its Liquid Collateral, including
a pledge of all of the Capital Stock of each of its Domestic Subsidiaries and
65% of all the Capital Stock of each of its Foreign Subsidiaries (excluding
Stanadyne Amalgamations Private Limited and Stanadyne Systems Private Limited).
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATION
1.1. DEFINITIONS. The following terms used herein, including in the
preamble, recitals, exhibits and schedules hereto, shall have the following
meanings:
"ACCOUNTS" means, as to each Credit Party, all of such Credit
Party's "accounts" as defined in the UCC, whether now owned or hereafter
acquired, including, without limitation, all present and future rights of such
Credit Party to payment of a monetary obligation, whether or not earned by
performance, which is not evidenced by chattel paper or an instrument, (a) for
property that has been or is to be sold, leased, licensed, assigned, or
otherwise disposed of, (b) for services rendered or to be rendered, (c) for a
secondary obligation incurred or to be incurred, or (d) arising out of the use
of a credit or charge card or information contained on or for use with such a
card.
"ACQUISITION" means the acquisition by KSTA Acquisition, LLC
of Holdings in accordance with the Acquisition Documents.
"ACQUISITION DOCUMENTS" means the Stock Purchase Agreement and
all other material documents executed and delivered in accordance with the terms
thereof and in connection therewith.
"ADJUSTED EURODOLLAR RATE" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar Rate
Loan, the rate per annum obtained by dividing (and rounding upward to the next
whole multiple of 1/16 of 1%) (i) (a) the rate per annum (rounded to the nearest
1/16 of 1%) equal to the rate determined by Administrative Agent to be the
offered rate which appears on the page of the Telerate Screen which displays an
average British Bankers Association Interest Settlement Rate (such page
currently being page number 3740 or 3750, as applicable) for deposits (for
delivery on the first day of such period) with a term equivalent to such period
in Dollars, determined as of approximately 11:00 a.m. (London, England time) on
such Interest Rate Determination Date, or (b) in the event the rate referenced
in the preceding clause (a) does not appear on such page or service or if such
page or service shall cease to be available, the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the rate determined by Administrative Agent to be
the offered rate on such other page or other service which displays an average
British Bankers Association Interest Settlement Rate for deposits (for delivery
on the first day of such period) with a term equivalent to such period in
Dollars, determined as of approximately 11:00 a.m. (London, England time) on
such Interest Rate Determination Date, or (c) in the event the rates referenced
in the preceding clauses (a) and (b) are not available, the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the offered quotation rate to
first class banks in the London interbank market by Citibank, N.A. for deposits
(for delivery on the first day of the relevant period) in Dollars of amounts in
same day funds comparable to the principal amount of the applicable Loan of
Administrative Agent, in its capacity as a Lender, for which the Adjusted
Eurodollar Rate is then being determined with maturities comparable to such
period as of approximately 11:00 a.m. (London, England time) on such Interest
Rate Determination Date, by (ii) an amount equal to (a) one minus (b) the
Applicable Reserve Requirement.
"ADMINISTRATIVE AGENT" as defined in the preamble hereto.
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"ADVERSE PROCEEDING" means any action, suit, proceeding
(whether administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of Holdings or any of its
Subsidiaries) at law or in equity, or before or by any Governmental Authority,
domestic or foreign (including any Environmental Claims), whether pending or, to
the knowledge of Holdings or any of its Subsidiaries, threatened against or
affecting Holdings or any of its Subsidiaries or any property of Holdings or any
of its Subsidiaries.
"AFFECTED LENDER" as defined in Section 2.15(b).
"AFFECTED LOANS" as defined in Section 2.15(b).
"AFFILIATE" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power (i) to vote 5% or more of the Securities having
ordinary voting power for the election of directors of such Person or (ii) to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or otherwise;
provided, that no Agent or Lender shall be deemed to be an "Affiliate" of any
Credit Party.
"AGENT" means each of Syndication Agent, Administrative Agent
and Collateral Agent.
"AGGREGATE AMOUNTS DUE" as defined in Section 2.14.
"AGGREGATE PAYMENTS" as defined in Section 7.2.
"AGREEMENT" means this Credit and Guaranty Agreement, dated as
of August 6, 2004, as it may be amended, supplemented or otherwise modified from
time to time.
"APPLICABLE RESERVE REQUIREMENT" means, at any time, for any
Eurodollar Rate Loan, the maximum rate, expressed as a decimal, at which
reserves (including, without limitation, any basic marginal, special,
supplemental, emergency or other reserves) are required to be maintained with
respect thereto against "Eurocurrency liabilities" (as such term is defined in
Regulation D) under regulations issued from time to time by the Board of
Governors of the Federal Reserve System or other applicable banking regulator.
Without limiting the effect of the foregoing, the Applicable Reserve Requirement
shall reflect any other reserves required to be maintained by such member banks
with respect to (i) any category of liabilities which includes deposits by
reference to which the applicable Adjusted Eurodollar Rate or any other interest
rate of a Loan is to be determined, or (ii) any category of extensions of credit
or other assets which include Eurodollar Rate Loans. A Eurodollar Rate Loan
shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credit for proration,
exceptions or offsets that may be available from time to time to the applicable
Lender. The rate of interest on Eurodollar Rate Loans shall be adjusted
automatically on and as of the effective date of any change in the Applicable
Reserve Requirement.
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"ASSET SALE" means a sale, lease or sub-lease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than
Borrower or any Guarantor Subsidiary or, in the case of a non-Guarantor
Subsidiary, another non-Guarantor Subsidiary), in one transaction or a series of
transactions, of all or any part of Holdings' or any of its Subsidiaries'
businesses, assets or properties of any kind, whether real, personal, or mixed
and whether tangible or intangible, whether now owned or hereafter acquired,
including, without limitation, the Capital Stock of any of Holdings'
Subsidiaries, other than (i) inventory (or other assets) sold, licensed or
leased in the ordinary course of business (excluding any such sales, licenses or
leases by operations or divisions discontinued or to be discontinued), (ii)
disposals of obsolete, worn-out or surplus property for aggregate consideration
of less than $2,000,000 with respect to any transaction or series of related
transactions or in the aggregate during any Fiscal Year, and (iii) sales of
other assets at fair market value for aggregate consideration of less than
$2,000,000 with respect to any transaction or series of related transactions or
in the aggregate during any Fiscal Year.
"ASSET SALE PROCEEDS ACCOUNT" means an account established
pursuant to the terms of Section 6.9(c) which account shall be subject to a
First Priority Lien in favor of the Term Collateral Agent on behalf of the Term
Secured Parties and a Second Priority Lien in favor of the Revolving Collateral
Agent on behalf of the Revolving Secured Parties.
"ASSIGNMENT AGREEMENT" means an Assignment and Assumption
Agreement substantially in the form of Exhibit E, with such amendments or
modifications as may be approved by Administrative Agent.
"ASSIGNMENT EFFECTIVE DATE" as defined in Section 10.6(b).
"AUTHORIZED OFFICER" means, as applied to any Person, any
individual holding the position of chairman of the board (if an officer), chief
executive officer, president or one of its vice presidents (or the equivalent
thereof), and such Person's chief financial officer, treasurer or controller.
"BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy," as now and hereafter in effect, or any successor statute.
"BASE RATE" means, for any day, a rate per annum equal to the
greater of (i) the Prime Rate in effect on such day and (ii) the Federal Funds
Effective Rate in effect on such day plus -1/2 of 1%. Any change in the Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be effective on the effective day of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"BASE RATE LOAN" means a Loan bearing interest at a rate
determined by reference to the Base Rate.
"BENEFICIARY" means each Agent, Lender, Lender Counterparty,
and Indemnitee.
"BORROWER" means Stanadyne Corporation.
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"BUSINESS DAY" means (i) any day excluding Saturday, Sunday
and any day which is a legal holiday under the laws of the State of New York or
is a day on which banking institutions located in such state are authorized or
required by law or other governmental action to close and (ii) with respect to
all notices, determinations, fundings and payments in connection with the
Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the term "BUSINESS DAY"
shall mean any day which is a Business Day described in clause (i) and which is
also a day for trading by and between banks in Dollar deposits in the London
interbank market.
"CAPITAL LEASE" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"CAPITAL STOCK" means any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person (other than
a corporation), including, without limitation, partnership interests and
membership interests, and any and all warrants, rights or options to purchase or
other arrangements or rights to acquire any of the foregoing.
"CASH" means money, currency or a credit balance in any demand
or Deposit Account.
"CASH EQUIVALENTS" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least P-1 from Xxxxx'x; (iii) commercial paper maturing no
more than one year from the date of creation thereof and having, at the time of
the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Xxxxx'x; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that has Tier 1 capital (as defined in
the regulations of its primary Federal banking regulator) of not less than
$100,000,000; and (v) shares of any money market mutual fund that (a) has
substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets of not
less than $500,000,000, and (c) has the highest rating obtainable from either
S&P or Xxxxx'x.
"CERTIFICATE RE: NON-BANK STATUS" means a certificate
substantially in the form of Exhibit F.
"CHANGE OF CONTROL" means, at any time:
(i) Sponsor shall cease to beneficially own and control at
least 51% on a fully diluted basis of the economic and voting interests in the
Capital Stock of Holdings;
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(ii) any Person or "group" (within the meaning of Rules 13d-3
and 13d-5 under the Exchange Act) other than Sponsor (a) shall have acquired
beneficial ownership of 35% or more on a fully diluted basis of the voting
and/or economic interest in the Capital Stock of Holdings or (b) shall have
obtained the power (whether or not exercised) to elect a majority of the members
of the board of directors (or similar governing body) of Holdings;
(iii) Holdings shall cease to beneficially own and control
100% on a fully diluted basis of the economic and voting interest in the Capital
Stock of Borrower;
(iv) the majority of the seats (other than vacant seats) on
the board of directors (or similar governing body) of Borrower cease to be
occupied by Persons who either (a) were members of the board of directors of
Borrower on the Closing Date or (b) were nominated for election by Sponsor or
the board of directors of Borrower, a majority of whom were directors on the
Closing Date or whose election or nomination for election was previously
approved by a majority of such directors; or
(v) any "change of control" or similar event shall occur under
the Senior Subordinated Notes or the Refinancing Notes that would require
Borrower to tender for or otherwise give rise to an accelerated repayment of the
Senior Subordinated Notes or the Refinancing Notes.
"CLOSING DATE" means the first date on which the conditions
precedent set forth in Section 3.1 are satisfied or waived in accordance with
the terms hereof and the Term Loans are made to Borrower.
"CLOSING DATE CERTIFICATE" means a Closing Date Certificate
substantially in the form of Exhibit G-1.
"CLOSING DATE MORTGAGED PROPERTY" as defined in Section
3.1(i).
"COLLATERAL" means the Fixed Collateral and the Liquid
Collateral.
"COLLATERAL AGENT" is defined in the preamble hereto.
"COLLATERAL DOCUMENTS" means the Term Pledge and Security
Agreement, the Mortgages, the IP Security Agreements, the Control Agreements,
the Landlord Personal Property Collateral Access Agreements, if any, the
Intercreditor Agreement and all other instruments, documents and agreements
delivered by any Credit Party pursuant to this Agreement or any of the other
Credit Documents in order to, or purporting to, (a) grant to Collateral Agent,
for the benefit of Term Secured Parties, a Lien on any real, personal or mixed
property of that Credit Party as security for the Obligations and/or (b) perfect
such Liens.
"COLLATERAL QUESTIONNAIRE" means a certificate in form
satisfactory to Administrative Agent that provides information with respect to
the personal or mixed property of each Credit Party.
"COMMITMENT" means the commitment of a Lender to make or
otherwise fund any Term Loan hereunder and "COMMITMENTS" means such commitments
of all Lenders in the
6
aggregate. The amount of each Lender's Commitment is set forth on Appendix A or
in the applicable Assignment Agreement, subject to any adjustment or reduction
pursuant to the terms and conditions hereof. The aggregate amount of the
Commitments as of the Closing Date is $65,000,000.
"COMPLIANCE CERTIFICATE" means a Compliance Certificate
substantially in the form of Exhibit C.
"CONSOLIDATED ADJUSTED EBITDA" means, for any period, an
amount determined for Borrower and its Subsidiaries on a consolidated basis
equal to:
(i) the sum, without duplication, of the amounts for such
period of (a) Consolidated Net Income, (b) Consolidated Interest Expense, (c)
provisions for taxes based on income, (d) total depreciation expense, (e) total
amortization expense, (f) Transaction Costs incurred and paid in such period,
(g) losses related to the redemption of SAC Notes not repurchased on or prior to
the Closing Date in the Debt Tender and (h) other non-Cash items (including
non-Cash purchase accounting adjustments) reducing Consolidated Net Income
(excluding any such non-Cash item to the extent that it represents an accrual or
reserve for potential Cash items in any future period or amortization of a
prepaid Cash item that was paid in a prior period) (i) management fees and
expenses permitted by Section 6.5(f), (j) transaction costs relating to
Permitted Acquisitions, dispositions, financings and debt extinguishment in an
aggregate amount not to exceed $2,500,000 in any Fiscal Year and (k)
restructuring charges in an amount not to exceed $5,000,000 per Fiscal Year,
plus (in any given Fiscal Year) up to $10,000,000 of unused amounts under this
clause (k) from prior Fiscal Years (or portions thereof) occurring since the
Closing Date, provided that the aggregate amount of restructuring charges
included in this clause (k) in all periods shall not exceed $25,000,000 in the
aggregate (in the case of clauses (b) through (k), (x) to the extent deducted in
determining Consolidated Net Income and (y) unless applicable to Persons whose
income (or losses) are not included in Consolidated Net Income pursuant to
clause (ii) of the definition thereof), minus
(ii) other non-Cash items increasing Consolidated Net Income
for such period (excluding any such non-Cash item to the extent it represents
the reversal of an accrual or reserve for potential Cash item in any prior
period).
Amounts for periods prior to the Closing Date shall be as set forth on Schedule
1.1A.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period,
the aggregate of all expenditures of Borrower and its Subsidiaries during such
period determined on a consolidated basis that, in accordance with GAAP, are or
should be included in "purchase of property and equipment" or similar items
reflected in the consolidated statement of cash flows of Borrower and its
Subsidiaries, excluding the purchase price of Permitted Acquisitions and
purchases made with the proceeds of permitted Asset Sales or insurance coverage.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
Consolidated Interest Expense for such period, excluding any amount not payable
in Cash.
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Borrower and its Subsidiaries on a
consolidated basis that may properly be classified as
7
current assets in conformity with GAAP, excluding Cash and Cash Equivalents and
deferred taxes.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Borrower and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with GAAP, excluding deferred taxes and the current portion of long
term debt and Capital Leases.
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an
amount (if positive) equal to:
(i) the sum, without duplication, of the amounts for such
period of (a) Consolidated Adjusted EBITDA (but determined by adding back
thereto, but without duplication, any amounts deducted in the calculation of
Consolidated Net Income for such Fiscal Year that were paid, incurred, or
accrued in violation of any of the provisions of this Agreement), plus (b) the
Consolidated Working Capital Adjustment, minus
(ii) the sum, without duplication, of the amounts for such
period of (a) voluntary and scheduled repayments of Consolidated Total Debt to
the extent such payments are not prohibited by this Agreement (excluding
repayment of (1) Revolving Loans or Swing Line Loans or Term Loans or (2) other
revolving loans except to the extent the commitments with respect to such other
revolving loans are permanently reduced in connection with such repayment), (b)
Consolidated Capital Expenditures to the extent such Consolidated Capital
Expenditures are permitted under this Agreement (net of any proceeds of (y) any
related financings with respect to such expenditures and (z) any sales of assets
used to finance such expenditures), (c) Consolidated Cash Interest Expense to
the extent related to Indebtedness permitted under this Agreement, (d) taxes
based on income of Holdings and its Subsidiaries payable in Cash with respect to
such period and actually paid, (e) cash consideration paid in respect of
Permitted Acquisitions and (f) add-backs to Consolidated Adjusted EBITDA
pursuant to clauses (i), (j) and (k) of the definition of Consolidated Adjusted
EBITDA.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Borrower and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Borrower
and its Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and net costs under Interest Rate
Agreements, but excluding, however, any amounts referred to in Section 2.10(d)
payable on or before the Closing Date.
"CONSOLIDATED NET INCOME" means, for any period:
(i) the net income (or loss) of Borrower and its Subsidiaries
on a consolidated basis for such period taken as a single accounting period
determined in conformity with GAAP, minus
(ii) (a) the income (or loss) of any Person (other than a
Subsidiary of Borrower) in which any other Person (other than Borrower or any of
its Subsidiaries) has an interest, except to the extent of the amount of
dividends or other distributions actually paid to
8
Borrower or any of its Subsidiaries by such Person during such period, (b) the
income (or loss) of any Person accrued prior to the date it becomes a Subsidiary
of Borrower or is merged into or consolidated with Borrower or any of its
Subsidiaries or that Person's assets are acquired by Borrower or any of its
Subsidiaries, (c) the income of any Subsidiary of Borrower to the extent that
the declaration or payment of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted by operation of the terms
of its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Subsidiary, (d) any after-tax
gains or losses attributable to Asset Sales or returned surplus assets of any
Pension Plan, and (e) (to the extent not included in clauses (a) through (d)
above) any net extraordinary gains or net extraordinary losses.
"CONSOLIDATED TOTAL DEBT" means, as at any date of
determination, (i) the aggregate stated balance sheet amount of all Indebtedness
of Borrower and its Subsidiaries determined on a consolidated basis in
accordance with GAAP, minus (ii) the sum of (x) Cash and Cash Equivalents on
hand at Borrower and Guarantor Subsidiaries and (y) Cash and Cash Equivalents on
hand at non-Guarantor Subsidiaries of Borrower in an amount not to exceed the
amount of Indebtedness of such non-Guarantor Subsidiary which is included in the
calculation of Consolidated Total Debt.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess of Consolidated Current Assets over Consolidated
Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any
period on a consolidated basis, the amount (which may be a negative number) by
which Consolidated Working Capital as of the beginning of such period exceeds
(or is less than) Consolidated Working Capital as of the end of such period.
"CONTRACTUAL OBLIGATION" means, as applied to any Person, any
provision of any Security issued by that Person or of any indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"CONTRIBUTING GUARANTORS" as defined in Section 7.2.
"CONTROL AGREEMENTS" means each control agreement executed and
delivered by the Collateral Agent for the benefit of the Secured Parties, a
securities intermediary or depositary bank and the applicable Credit Party on
the Closing Date and each control agreement to be executed and delivered by
Collateral Agent, a securities intermediary or depositary bank and the
applicable Credit Party pursuant to the terms of the Term Pledge and Security
Agreement with such modifications as Collateral Agent may reasonably request or
approve.
"CONTROL INVESTMENT AFFILIATE" means, with respect to any
Person, any other Person that (a) directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person and (b) is organized
by such Person primarily for the purpose of making equity or debt investments in
one or more companies. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.
9
"CONVERSION/CONTINUATION DATE" means the effective date of a
continuation or conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.
"CONVERSION/CONTINUATION NOTICE" means a
Conversion/Continuation Notice substantially in the form of Exhibit A-2.
"COUNTERPART AGREEMENT" means a Counterpart Agreement
substantially in the form of Exhibit G delivered by a Credit Party pursuant to
Section 5.10.
"CREDIT DOCUMENT" means any of this Agreement, the Notes, if
any, the Collateral Documents and all other documents, instruments or agreements
executed and delivered by a Credit Party for the benefit of any Agent or any
Lender in connection herewith (in each case as such documents, instruments or
agreements may be amended, restated, supplemented or otherwise modified from
time to time).
"CREDIT EXTENSION" means the making of a Loan.
"CREDIT PARTY" means each Person (other than any Agent or any
Lender or any other representative thereof or any non-Affiliates of Borrower or
its Subsidiaries) from time to time party to a Credit Document.
"CURRENCY AGREEMENT" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic cap or
other similar agreement or arrangement, each of which is for the purpose of
hedging the foreign currency risk associated with Holdings' and its
Subsidiaries' operations and not for speculative purposes.
"DEBT TENDER" means the receipt of tender and consents by
Borrower of at least 50% in principal amount of the SAC Notes.
"DEFAULT" means a condition or event that, after notice or
lapse of time or both, would constitute an Event of Default.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" means any Subsidiary organized under the
laws of the United States of America, any State thereof or the District of
Columbia.
"ELIGIBLE ASSIGNEE" means (i) any Lender, any Affiliate of any
Lender and any Related Fund with respect to a Lender (any two or more Related
Funds being treated as a single Eligible Assignee for all purposes hereof), and
(ii) any commercial bank, financial institution, insurance company, investment
or mutual fund or other entity that is an "accredited investor" (as defined in
Regulation D under the Securities Act) and which extends credit or buys loans as
one
10
of its businesses; provided, none of Holdings, any Affiliate of Holdings or
Sponsor (other than Antares Capital Corporation in its capacity as a Lender)
shall be an Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is or, within the preceding six years
was, sponsored, maintained or contributed to by, or required to be contributed
by, Holdings or any of its Subsidiaries or any of their respective ERISA
Affiliates.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice
of violation, claim, action, suit, proceeding, demand, abatement order or other
order (including consent orders) or directive (conditional or otherwise), by any
Governmental Authority or any other Person, arising (i) pursuant to or in
connection with any actual or alleged violation of any Environmental Law; (ii)
in connection with any Hazardous Material or any actual or alleged Hazardous
Materials Activity; or (iii) in connection with any actual or alleged damage,
injury, threat or harm to health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all foreign or domestic,
federal or state (or any subdivision of either of them) or local statutes,
ordinances, orders (including consent orders), rules, regulations, judgments,
treaties, Governmental Authorizations, or any other requirements of Governmental
Authorities relating to or imposing standards of conduct concerning (i)
environmental matters, including those relating to any Hazardous Materials
Activity; (ii) the Release, generation, use, storage, transportation or disposal
of, or exposure to, Hazardous Materials; (iii) industrial hygiene, occupational
safety and health; (iv) natural resources or natural resource damages; (v) land
use or (vi) the protection of human, plant or animal health or welfare, in any
manner applicable to Holdings or any of its Subsidiaries or any Facility.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; and (ii) any trade or business (whether or not incorporated) which is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member. Any former ERISA Affiliate of Holdings or any of its Subsidiaries shall
continue to be considered an ERISA Affiliate of Holdings or any such Subsidiary
within the meaning of this definition to the extent that Holdings or such
Subsidiary could reasonably be expected to have any liability with respect
thereto under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued thereunder with
respect to any Pension Plan (excluding those for which the provision for 30-day
notice to the PBGC has been waived by regulation); (ii) the failure to meet the
minimum funding standard of Section 412 of the Internal Revenue Code with
respect to any Pension Plan (whether or not waived in accordance with Section
412(d) of the Internal Revenue Code) or the failure to make any required
contribution to a Multiemployer Plan; (iii) the provision by the administrator
of any Pension Plan pursuant to
11
Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a
distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal
by Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability to Holdings, any of its
Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or
4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any
Pension Plan, or the occurrence of any event or condition which is reasonably
likely to constitute grounds under ERISA for the termination of, or the
appointment by PGBC of a trustee to administer, any Pension Plan; (vi) the
imposition of liability on Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by
reason of the application of Section 4212(c) of ERISA; (vii) the withdrawal of
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates in
a complete or partial withdrawal (within the meaning of Sections 4203 and 4205
of ERISA) from any Multiemployer Plan if there is any potential liability
therefore, or the receipt by Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates of notice from any Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that
it intends to terminate or has terminated under Section 4041A or 4042 of ERISA;
(viii) the occurrence of an act or omission which could give rise to the
imposition on Holdings or any of its Subsidiaries, including through any joint
and several liability with any of their respective ERISA Affiliates, of fines,
penalties, taxes or related charges under Chapter 43 of the Internal Revenue
Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA
in respect of any Employee Benefit Plan; (ix) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(x) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"EURODOLLAR RATE LOAN" means a Loan bearing interest at a rate
determined by reference to the Adjusted Eurodollar Rate.
"EVENT OF DEFAULT" means each of the conditions or events set
forth in Section 8.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"EXISTING CAPITAL LEASES" means the Capital Leases listed on
Schedule 1.1(b) entered into by Stanadyne Corporation or a Subsidiary thereof as
indicated thereon prior to the date hereof.
"EXISTING INDEBTEDNESS" means the pre-existing Indebtedness of
Borrower and its Subsidiaries on the Closing Date described in Schedule 1.1B
hereto.
12
"FACILITY" means any real property (including all buildings,
fixtures or other improvements located thereon) now, hereafter or heretofore
owned, leased or operated by Holdings or any of its Subsidiaries or any of their
respective predecessors or Affiliates.
"FAIR SHARE CONTRIBUTION AMOUNT" as defined in Section 7.2.
"FAIR SHARE" as defined in Section 7.2.
"FEDERAL FUNDS EFFECTIVE RATE" means for any day, the rate per
annum (expressed, as a decimal, rounded upwards, if necessary, to the next
higher 1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided, (i) if such
day is not a Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so published on
the next succeeding Business Day, and (ii) if no such rate is so published on
such next succeeding Business Day, the Federal Funds Rate for such day shall be
the average rate charged to Administrative Agent, in its capacity as a Lender,
on such day on such transactions as determined by Administrative Agent.
"FINANCIAL OFFICER CERTIFICATION" means, with respect to the
financial statements for which such certification is required, the certification
of the chief financial officer of Borrower that such financial statements fairly
present, in all material respects, the financial condition of Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments and in the case of interim financial
statements, the absence of footnotes.
"FINANCIAL PLAN" as defined in Section 5.1(i).
"FIRST PRIORITY" means, with respect to any Lien purported to
be created in any Collateral pursuant to any Collateral Document, that such Lien
is prior in right to any other Lien thereon, other than Permitted Liens
described in clauses (b) through (f), (i), (j), (k), (l) and (p) of Section 6.2.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Borrower and its
Subsidiaries ending on December 31 of each calendar year or, with respect to any
non-Guarantor Subsidiaries only, December 31 or November 30 of each calendar
year, as the case may be.
"FIXED COLLATERAL" means, collectively, all of the real,
personal and mixed property in which First Priority Liens are purported to be
granted pursuant to the Collateral Documents as security for the Term
Obligations and shall include all "Fixed Collateral" as defined in the
Intercreditor Agreement.
"FLOOD HAZARD PROPERTY" means any Real Estate Asset subject to
a mortgage in favor of Collateral Agent, for the benefit of the Term Secured
Parties or the Revolving Secured Parties, and located in an area designated by
the Federal Emergency Management Agency as having special flood or mud slide
hazards.
13
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a
Domestic Subsidiary.
"FUNDING GUARANTORS" as defined in Section 7.2.
"FUNDING NOTICE" means a notice substantially in the form of
Exhibit A-1.
"GAAP" means, subject to the limitations on the application
thereof set forth in Xxxxxxx 0.0, Xxxxxx Xxxxxx of America generally accepted
accounting principles in effect as of the date of determination thereof.
"GOVERNMENTAL ACTS" means any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto government or
Governmental Authority.
"GOVERNMENTAL AUTHORITY" means any federal, state, municipal,
national or other government, governmental department, commission, board,
bureau, court, agency or instrumentality or political subdivision thereof or any
entity or officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
authorization, approval, plan, directive, consent order or consent decree of or
from any Governmental Authority.
"GRANTOR" as defined in the Term Pledge and Security
Agreement.
"GSCP" means Xxxxxxx Xxxxx Credit Partners L.P.
"GUARANTEED OBLIGATIONS" as defined in Section 7.1.
"GUARANTOR" means each of Holdings and each Domestic
Subsidiary of Holdings (other than Borrower).
"GUARANTOR SUBSIDIARY" means each Guarantor other than
Holdings.
"GUARANTY" means the guaranty of each Guarantor set forth in
Section 7.
"HAZARDOUS MATERIALS" means any chemical, compound,
constituent, material, waste or substance, which is prohibited, limited or
regulated by any Governmental Authority or pursuant to any Environmental Law or
which may or could pose a hazard to the health and safety of any Persons or to
the indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current,
future, proposed or threatened activity, event or occurrence involving any
Hazardous Materials, including the use, manufacture, possession, storage,
holding, presence, existence, location, Release, threatened Release, discharge,
placement, generation, transportation, processing, construction, treatment,
abatement, removal, remediation, disposal, disposition or handling of any
Hazardous Materials, and any corrective action or response action with respect
to any of the foregoing.
14
"HEDGE AGREEMENT" means an Interest Rate Agreement or a
Currency Agreement entered into with a Lender Counterparty in order to satisfy
the requirements of this Agreement or otherwise in the ordinary course of
Holdings' or any of its Subsidiaries' businesses.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate,
if any, that at any time or from time to time may be contracted for, charged, or
received under the laws applicable to any Lender which are presently in effect
or, to the extent allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
"HISTORICAL FINANCIAL STATEMENTS" means as of the Closing
Date, (i) the audited financial statements of Borrower and its Subsidiaries, for
the immediately preceding three (3) Fiscal Years, consisting of balance sheets
and the related consolidated statements of income, stockholders' equity and cash
flows for such Fiscal Years, and (ii) the unaudited financial statements of
Borrower and its Subsidiaries as at the most recently ended Fiscal Quarter,
consisting of a balance sheet and the related consolidated statements of income,
stockholders' equity and cash flows for the three-, six-or nine-month period, as
applicable, ending on such date, and, in the case of clauses (i) and (ii),
certified by the chief financial officer of Borrower that they fairly present,
in all material respects, the financial condition of Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments and in the case of interim financial
statements, the absence of footnotes.
"HOLDINGS" as defined in the preamble hereto.
"IMMATERIAL SUBSIDIARY" means, as of any date, any Subsidiary
whose total assets, as of that date, are less than $100,000 and whose total
revenues for the most recent twelve-month period do not exceed $100,000.
"INCREASED-COST LENDERS" as defined in Section 2.19.
"INDEBTEDNESS", as applied to any Person, means, without
duplication, (i) all indebtedness for borrowed money; (ii) that portion of
obligations with respect to Capital Leases that is properly classified as a
liability on a balance sheet in conformity with GAAP; (iii) notes payable and
drafts accepted representing extensions of credit whether or not representing
obligations for borrowed money; (iv) any obligation owed for all or any part of
the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA), which purchase price is (a) (except to the
extent disputed in good faith) due more than six months from the date of
incurrence of the obligation in respect thereof or (b) evidenced by a note or
similar written instrument; (v) all indebtedness secured by any Lien on any
property or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person; (vi) the face amount of any letter of
credit issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings; (vii) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the Indebtedness of another;
15
(viii) any obligation of such Person the primary purpose or intent of which is
to provide assurance to an obligee that the obligation of the obligor thereof
will be paid or discharged, or any agreement relating thereto will be complied
with, or the holders thereof will be protected (in whole or in part) against
loss in respect thereof; (ix) any liability of such Person for an obligation of
another through any agreement (contingent or otherwise) (a) to purchase,
repurchase or otherwise acquire such obligation or any security therefor, or to
provide funds for the payment or discharge of such obligation (whether in the
form of loans, advances, stock purchases, capital contributions or otherwise) or
(b) to maintain the solvency or any balance sheet item, level of income or
financial condition of another if, in the case of any agreement described under
subclauses (a) or (b) of this clause (ix), the primary purpose or intent thereof
is as described in clause (viii) above; and (x) all obligations of such Person
in respect of any exchange traded or over the counter derivative transaction,
including, without limitation, any Interest Rate Agreement, Currency Agreement
and any commodities hedging agreement, whether entered into for hedging or
speculative purposes.
"INDEMNIFIED LIABILITIES" means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, claims (including Environmental Claims), costs (including the
reasonable costs of any investigation, study, sampling, testing, abatement,
cleanup, removal, remediation or other response action necessary to remove,
remediate, clean up or xxxxx any past, present or future Hazardous Materials
Activity), reasonable expenses and disbursements of any kind or nature
whatsoever (including the reasonable fees and disbursements of counsel for
Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
reasonable fees or expenses incurred by Indemnitees in enforcing the indemnity
contained in Section 10.3), whether direct, indirect or consequential and
whether based on any federal, state or foreign laws, statutes, rules or
regulations (including securities and commercial laws, statutes, rules or
regulations and Environmental Laws), on common law or equitable cause or on
contract or otherwise, that may be imposed on, incurred by, or asserted against
any such Indemnitee, in any manner relating to or arising out of (i) this
Agreement or the other Credit Documents or the transactions contemplated hereby
or thereby (including the Lenders' agreement to make Credit Extensions or the
use or intended use of the proceeds thereof, or any enforcement of any of the
Credit Documents (including any sale of, collection from, or other realization
upon any of the Collateral or the enforcement of the Guaranty)); (ii) the
statements contained in the commitment letter delivered by any Lender to KSTA
Acquisition LLC with respect to the transactions contemplated by this Agreement;
or (iii) any Environmental Claim or any Hazardous Materials Activity relating to
or arising from, directly or indirectly, any past, present or future activity,
operation, land ownership, or practice of Holdings or any of its Subsidiaries.
"INDEMNITEE" as defined in Section 10.3.
"INSTALLMENT" as defined in Section 2.2.
"INSTALLMENT DATE" as defined in Section 2.2.
16
"INTERCREDITOR AGREEMENT" means the Intercreditor Agreement,
dated as of the Closing Date, by and among Collateral Agent, Revolving
Collateral Agent and Grantors.
"INTEREST PAYMENT DATE" means each of January 1, April 1, July
1 and October 1 of each year, commencing on the first such date to occur after
the Closing Date and the final maturity date of such Loan.
"INTEREST PERIOD" means, in connection with a Eurodollar Rate
Loan, an interest period of one-, two-, three- or six-months (or, with the
consent of each affected Lender, nine- or twelve-months), as selected by
Borrower in the applicable Funding Notice or Conversion/Continuation Notice, (i)
initially, commencing on the date of borrowing or Conversion/Continuation Date
thereof; as the case may be, and (ii) thereafter, commencing on the day on which
the immediately preceding Interest Period expires; provided, (a) if an Interest
Period would otherwise expire on a day that is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day unless no further
Business Day occurs in such month, in which case such Interest Period shall
expire on the immediately preceding Business Day; (b) any Interest Period that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clauses (c) and (d), of this definition, end
on the last Business Day of a calendar month; and (c) no Interest Period with
respect to any portion of any Term Loans shall extend beyond the Term Loan
Maturity Date.
"INTEREST RATE AGREEMENT" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, interest
rate hedging agreement or other similar agreement or arrangement, each of which
is for the purpose of hedging the interest rate exposure associated with
Holdings' and its Subsidiaries' operations and not for speculative purposes.
"INTEREST RATE DETERMINATION DATE" means, with respect to any
Interest Period, the date that is two Business Days prior to the first day of
such Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter, and any
successor statute.
"INVENTORY" means, as to Borrower or a Guarantor, (i) all
"inventory" as defined in Article 9 of the UCC and (ii) all goods held for sale
or lease or to be furnished under contracts of service or so leased or
furnished, all raw materials, work in process, finished goods, and materials
used or consumed in the manufacture, packing, shipping, advertising, selling,
leasing, furnishing or production of such inventory or otherwise used or
consumed in such Person's business; all goods in which such Person has an
interest in mass or a joint or other interest or right of any kind; and all
goods which are returned to or repossessed by such Person, all computer programs
embedded in any goods and all accessions thereto and products thereof (in each
case, regardless of whether characterized as inventory under the UCC).
"INVESTMENT" means (i) any direct or indirect purchase or
other acquisition by Holdings or any of its Subsidiaries of, or of a beneficial
interest in, any of the Securities of any other Person (other than a Guarantor
Subsidiary); (ii) any direct or indirect redemption, retirement, purchase or
other acquisition for value, by any Subsidiary of Holdings from any
17
Person (other than Holdings or any Guarantor Subsidiary), of any Capital Stock
of such Person; and (iii) any direct or indirect loan, advance (other than
advances to employees for moving, entertainment and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business) or capital
contribution by Holdings or any of its Subsidiaries to any other Person (other
than Holdings or any Guarantor Subsidiary), including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business but
excluding accounts receivable that are not so included. The amount of any
Investment shall be the original cost of such Investment plus the cost of all
additions thereto, without any adjustments for increases or decreases in value,
or write-ups, write-downs or write-offs with respect to such Investment.
"IP SECURITY AGREEMENT" means each IP Security Agreement,
dated as of the Closing Date, by and among Borrower, each Guarantor and
Collateral Agent.
"JOINT VENTURE" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form;
provided, in no event shall any corporate Subsidiary of any Person be considered
to be a Joint Venture to which such Person is a party.
"LANDLORD CONSENT AND ESTOPPEL" means, with respect to any
Leasehold Property, a letter, certificate or other instrument in writing from
the lessor under the related lease, pursuant to which, among other things, the
landlord consents to the granting of a Mortgage on such Leasehold Property by
the Credit Party tenant, such Landlord Consent and Estoppel to be in form and
substance acceptable to Collateral Agent in its reasonable discretion, but in
any event sufficient for Collateral Agent to obtain a Title Policy with respect
to such Mortgage.
"LANDLORD PERSONAL PROPERTY COLLATERAL ACCESS AGREEMENT" means
a Landlord Waiver and Consent Agreement substantially in the form of Exhibit I
with such amendments or modifications as may be approved by Collateral Agent.
"LEASEHOLD PROPERTY" means any leasehold interest of any
Credit Party as lessee under any lease of real property, other than any such
leasehold interest designated from time to time by Collateral Agent in its
reasonable discretion as not being required to be included in the Collateral.
"LENDER" means each financial institution listed on the
signature pages hereto as a Lender, and any other Person that becomes a party
hereto pursuant to an Assignment Agreement.
"LENDER COUNTERPARTY" means each Lender or Agent or any
Affiliate of a Lender or an Agent, counterparty to a Hedge Agreement (including
any Person who is a Lender (and any Affiliate thereof) as of the Closing Date
but subsequently, whether before or after entering into a Hedge Agreement,
ceases to be a Lender).
"LETTERS OF CREDIT" means Letters of Credit under (and as
defined in) the Revolving Credit Agreement and shall include any Permitted
Refinancings thereof.
"LEVERAGE RATIO" means the ratio as of the last day of any
Fiscal Quarter or other date of determination of:
18
(i) Consolidated Total Debt as of such day; to
(ii) Consolidated Adjusted EBITDA for the four-Fiscal Quarter
period ending on such date (or if such date of determination is not the last day
of a Fiscal Quarter, for the four-Fiscal Quarter period ending as of the most
recently concluded Fiscal Quarter);
provided, however, (a) for purposes of determining Consolidated Total Debt for
use in computing the Leverage Ratio at the end of any Fiscal Quarter or other
date of determination, the average daily balance of any revolving credit
facility during the four-Fiscal Quarter period referred to in clause (ii) above
shall be substituted for the balance of such facility outstanding on the last
day of such Fiscal Quarter or other date of determination and (b) Consolidated
Adjusted EBITDA shall be pro forma for Permitted Acquisitions as if they had
occurred on the first day of the four-Fiscal Quarter period then ending.
"LIEN" means (i) any lien, mortgage, pledge, assignment,
security interest, charge or encumbrance of any kind (including any agreement to
give any of the foregoing, any conditional sale or other title retention
agreement, and any lease in the nature thereof) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing and
(ii) in the case of Securities, any purchase option, call or similar right of a
third party with respect to such Securities.
"LIQUID COLLATERAL" means, collectively, all of the personal
property in which Second Priority Liens are purported to be granted pursuant to
the Collateral Documents as security for the Term Obligations and shall include
all "Liquid Collateral" as defined in the Intercreditor Agreement.
"LOAN" means a Term Loan.
"MARGIN STOCK" as defined in Regulation U of the Board of
Governors of the Federal Reserve System as in effect from time to time.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
and/or material adverse developments with respect to (i) the business
operations, properties, assets, condition (financial or otherwise) or prospects
of Holdings and its Subsidiaries, taken as a whole; (ii) the impairment (other
than as a result of circumstances covered by clause (i) above) of the ability of
any Credit Party to fully and timely perform its Term Obligations; (iii) the
legality, validity, binding effect or enforceability against a Credit Party of a
Credit Document to which it is a party; or (iv) the rights and remedies
available to, or conferred upon, any Agent, any Lender or any Secured Party
under any Credit Document.
"MATERIAL CONTRACT" means any contract or other arrangement to
which Holdings or any of its Subsidiaries is a party (other than the Credit
Documents) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect.
"MATERIAL REAL ESTATE ASSET" means (i)(a) any fee-owned Real
Estate Asset having a fair market value in excess of $1,000,000 as of the date
of the acquisition thereof and (b) all Leasehold Properties upon or in which
Holdings or any of its Subsidiaries conducts
19
manufacturing, assembly or similar operations which operations account for more
than 10% of the manufacturing and assembly revenues of Borrower and its
Subsidiaries taken as a whole, and (c) Leasehold Properties that are subject to
a sale and leaseback permitted under Section 6.11 or (ii) any Real Estate Asset
that the Requisite Lenders have determined is material to the business,
operations, properties, assets, condition (financial or otherwise) or prospects
of Holdings or any Subsidiary thereof, including Borrower.
"MOODY'S" means Xxxxx'x Investor Services, Inc.
"MORTGAGE" means a Mortgage or Deed of Trust substantially in
the form of Exhibit J, as it may be amended, supplemented or otherwise modified
from time to time.
"MULTIEMPLOYER PLAN" means any "multiemployer plan" as defined
in Section 3(37) of ERISA with respect to which Holdings, any Subsidiary or any
ERISA Affiliate has, or would reasonably be expected to have, any liability
(whether absolute or contingent).
"NAIC" means The National Association of Insurance
Commissioners, and any successor thereto.
"NARRATIVE REPORT" means, with respect to the financial
statements for which such narrative report is required, a narrative report
describing the operations of Borrower and its Subsidiaries in the form prepared
for presentation to senior management thereof for the applicable Fiscal Quarter
or Fiscal Year and for the period from the beginning of the then current Fiscal
Year to the end of such period to which such financial statements relate.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset
Sale, an amount equal to:
(i) Cash payments (including any Cash received by way of
deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) received by Holdings or any of its
Subsidiaries from such Asset Sale, minus
(ii) any bona fide direct costs or expenses incurred in
connection with such Asset Sale and payable to a Person that is not Holdings or
a Subsidiary thereof, including without limitation, (a) income or gains taxes
payable by the seller as a result of any gain recognized in connection with such
Asset Sale, (b) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness permitted to be incurred under
Section 6.1 (other than the Loans or the Revolving Loans) that is secured by a
Lien on the stock or assets in question and that is required to be repaid under
the terms thereof as a result of such Asset Sale and (c) a reasonable reserve
for any indemnification payments (fixed or contingent) attributable to seller's
indemnities and representations and warranties to purchaser in respect of such
Asset Sale undertaken by Holdings or a Subsidiary thereof in connection with
such Asset Sale and (d) brokers fees, accountant fees and expenses, counsel fees
and expenses and other termination costs.
"NET INSURANCE/CONDEMNATION PROCEEDS" means an amount equal
to:
20
(i) any Cash payments or proceeds received by Holdings or any
of its Subsidiaries (a) under any casualty insurance policy in respect of a
covered loss thereunder or (b) as a result of the taking of any assets of
Holdings or any of its Subsidiaries by any Person pursuant to the power of
eminent domain, condemnation or otherwise, or pursuant to a sale of any such
assets to a purchaser with such power under threat of such a taking, minus
(ii) (a) any actual and reasonable costs incurred by Holdings
or any of its Subsidiaries in connection with the adjustment or settlement of
any claims of Holdings or such Subsidiary in respect thereof and payable to a
Person that is not Holdings or its Subsidiaries, (b) any bona fide direct costs
incurred in connection with any sale of such assets as referred to in clause
(i)(b) of this definition, including income taxes payable as a result of any
gain recognized in connection therewith and (c) actual and reasonable counsel
fees and expenses.
"NON-CASH PAY" means:
(a) with respect to any Preferred Stock, that such Preferred
Stock is not Cash-Pay Preferred Stock; and
(b) with respect to any Capital Stock (other than Preferred
Stock), that such Capital Stock does not require any cash payments (whether in
respect of dividends, redemption, repurchase or otherwise) to be made thereon or
in respect thereof on or prior to the date that is 91 days after the Term Loan
Maturity Date.
"NON-US LENDER" as defined in Section 2.17(c).
"NOTE" means a Term Loan Note.
"NOTICE" means a Funding Notice or a Conversion/Continuation
Notice.
"OBLIGATIONS" means the Revolving Obligations and the Term
Obligations.
"OBLIGEE GUARANTOR" as defined in Section 7.7.
"ORGANIZATIONAL DOCUMENTS" means (i) with respect to any
corporation, its certificate or articles of incorporation or organization, as
amended, and its by-laws, as amended, (ii) with respect to any limited
partnership, its certificate of limited partnership, as amended, and its
partnership agreement, as amended, (iii) with respect to any general
partnership, its partnership agreement, as amended, (iv) with respect to any
limited liability company, its articles of organization, as amended, and its
operating agreement, as amended and (v) with respect to any other business
entity, the agreement or documents analogous to any of the foregoing. In the
event any term or condition of this Agreement or any other Credit Document
requires any Organizational Document to be certified by a secretary of state or
similar governmental official, the reference to any such "Organizational
Document" shall only be to a document of a type customarily certified by such
governmental official.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
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"PENSION PLAN" means any employee benefit plan within the
meaning of Section 3(3) of ERISA, other than a Multiemployer Plan, which is
subject to Title IV of ERISA, and with respect to which Holdings, any Subsidiary
or any ERISA Affiliate has, or would reasonably be expected to have, any
liability (whether absolute or contingent).
"PERMITTED ACQUISITION" means any acquisition by Borrower or
any of its wholly-owned Guarantor Subsidiaries, whether by purchase, merger or
otherwise, of all or substantially all of the assets of, all of the Capital
Stock of, or a business line or unit or a division of, any Person; provided,
(i) immediately prior to, and after giving effect
thereto, no Default or Event of Default shall have occurred and be
continuing or would result therefrom;
(ii) all transactions in connection therewith shall
be consummated in accordance with all applicable laws and in conformity
with all applicable Governmental Authorizations;
(iii) in the case of the acquisition of Capital
Stock, all of the Capital Stock (except for any such Securities in the
nature of directors' qualifying shares required pursuant to applicable
law) acquired or otherwise issued by such Person or any newly formed
Subsidiary of Borrower in connection with such acquisition shall be
owned 100% by Borrower or a Guarantor Subsidiary thereof, and Borrower
shall have taken, or caused to be taken, as of the date such Person
becomes a Subsidiary of Borrower, each of the actions set forth in
Sections 5.10 and/or 5.11, as applicable;
(iv) Borrower shall have delivered to Administrative
Agent at least 10 Business Days prior to such proposed acquisition all
relevant financial information with respect to such acquired assets,
including, without limitation, the aggregate consideration for such
acquisition and any other information reasonably requested by
Administrative Agent; and
(v) any Person or assets or division as acquired in
accordance herewith shall be in same business or lines of business in
which Borrower and/or its Subsidiaries are engaged as of the Closing
Date or a business reasonably related thereto.
"PERMITTED CURE SECURITY" means a Non-Cash Pay equity security
of Holdings issued pursuant to Section 8.2.
"PERMITTED LIENS" means each of the Liens permitted pursuant
to Section 6.2.
"PERMITTED REFINANCING means, as to any Indebtedness, the
Refinancing of such Indebtedness ("REFINANCING INDEBTEDNESS"); provided that, in
the case of such Refinancing Indebtedness, the following conditions are
satisfied:
(i) the weighted average life to maturity of such
Refinancing Indebtedness shall be greater than or equal to the weighted
average life to maturity of the Indebtedness being refinanced, and the
first scheduled principal payment in respect of
22
such Refinancing Indebtedness shall not be earlier than the first
scheduled principal payment in respect of the Indebtedness being
refinanced;
(ii) the principal amount of such Refinancing
Indebtedness shall be less than or equal to the principal amount then
outstanding of the Indebtedness being refinanced;
(iii) the respective obligor or obligors shall be the
same on the Refinancing Indebtedness as on the Indebtedness being
refinanced;
(iv) the security, if any, for the Refinancing
Indebtedness shall be the same as that for the Indebtedness being
refinanced (except to the extent that less security is granted to
holders of Refinancing Indebtedness); and
(v) no material terms applicable to such Refinancing
Indebtedness or, if applicable, the related guarantees of such
Refinancing Indebtedness (including covenants, events of default,
remedies and acceleration rights) shall be materially more favorable to
the refinancing lenders than the terms that are applicable under the
instruments and documents governing the Indebtedness being refinanced,
in each case, taken as a whole.
"PERSON" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and Governmental Authorities.
"PHASE I REPORT" means, with respect to any Facility, a report
that is either (A) set forth on Schedule 3.1(k), or (B) in form and substance
reasonably satisfactory to Administrative Agent that (i) conforms to the ASTM
Standard Practice for Environmental Site Assessments: Phase I Environmental Site
Assessment Process, E 1527-00, (ii) was conducted no more than six months prior
to the date such report is required to be delivered hereunder, by one or more
environmental consulting firms reasonably satisfactory to Administrative Agent,
(iii) includes an assessment of asbestos-containing materials at such Facility,
(iv) is accompanied by (a) an estimate of the reasonable worst-case cost of
investigating and remediating any Hazardous Materials Activity identified in the
Phase I Report as giving rise to an actual or potential material violation of
any Environmental Law or as presenting a material risk of giving rise to a
material Environmental Claim, and (b) a current compliance audit. All Phase I
Reports shall expressly specify that the report may be relied on by
Administrative Agent or Administrative Agent shall have received a reliance
letter so stating.
"PREFERRED STOCK" means, with respect to any corporation,
capital stock issued by such corporation that is entitled to a preference or
priority, in respect of dividends or distribution upon liquidation, over some
other class of capital stock issued by such corporation.
"PRIME RATE" means the rate of interest quoted in The Wall
Street Journal, Money Rates Section as the Prime Rate (currently defined as the
base rate on corporate loans posted by at least 75% of the nation's thirty (30)
largest banks), as in effect from time to time. The Prime Rate is a reference
rate and does not necessarily represent the lowest or best rate
23
actually charged to any customer. Any Agent or any other Lender may make
commercial loans or other loans at rates of interest at, above or below the
Prime Rate.
"PRINCIPAL OFFICE" means, for any Person, such Person's
"Principal Office" as set forth on Appendix B, or such other office or office of
a third party or sub-agent, as appropriate, as such Person may from time to time
designate in writing to Borrower, Administrative Agent and each Lender.
"PROJECTIONS" as defined in Section 4.8.
"PRO RATA SHARE" means with respect to all payments,
computations and other matters relating to the Commitment or Loans of any
Lender, the percentage obtained by dividing (a) the Term Loan Exposure of that
Lender by (b) the aggregate Term Loan Exposure of all Lenders.
"REAL ESTATE ASSET" means, at any time of determination, any
interest (fee or leasehold) then owned by any Credit Party in any real property.
"RECORD DOCUMENT" means, with respect to any Leasehold
Property, (i) the lease evidencing such Leasehold Property or a memorandum
thereof, executed and acknowledged by the owner of the affected real property,
as lessor, or (ii) if such Leasehold Property was acquired or subleased from the
holder of a Recorded Leasehold Interest, the applicable assignment or sublease
document, executed and acknowledged by such holder, in each case in form
sufficient to give such constructive notice upon recordation and otherwise in
form reasonably satisfactory to Collateral Agent.
"RECORDED LEASEHOLD INTEREST" means a Leasehold Property with
respect to which a Record Document has been recorded in all places necessary or
desirable, in Administrative Agent's reasonable judgment, to give constructive
notice of such Leasehold Property to third-party purchasers and encumbrancers of
the affected real property.
"REFINANCE" means, in respect of any Indebtedness, to
refinance, extend, renew, defease, amend, modify, supplement, restructure,
replace, refund or repay, or to issue other Indebtedness, in exchange or
replacement for, such Indebtedness in whole or in part. "REFINANCED" and
"REFINANCING" shall have correlative meanings.
"REFINANCING NOTE INDENTURE" means the trust indenture
pursuant to which any Refinancing Notes may be issued in accordance with the
terms of this Agreement, as such indenture may be further amended, restated,
supplemented, modified, extended, renewed or replaced from time to time in
accordance with Section 6.16 of this Agreement.
"REFINANCING NOTES" as defined in Section 6.1(k).
"REGISTER" as defined in Section 2.5(b).
"REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
24
"RELATED AGREEMENTS" means, collectively, the Stock Purchase
Agreement, the Stockholders Agreement and the documents governing the Senior
Subordinated Notes, the Refinancing Notes and the Existing Capital Leases.
"RELATED FUND" means any investment fund that is (i) engaged
in making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit and (ii) is administered and managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"RELEASE" means any release, spill, emission, leaking,
pumping, pouring, injection, seepage, escaping, deposit, disposal, discharge,
dispersal, dumping, leaching or migration of any Hazardous Material into the
indoor or outdoor environment (including the abandonment or disposal of any
barrels, containers or other closed receptacles containing any Hazardous
Material), including the movement of any Hazardous Material through the air,
soil, surface water or groundwater.
"REPLACEMENT LENDER" as defined in Section 2.19.
"REQUISITE LENDERS" means one or more Lenders having or
holding Term Loan Exposure and representing more than 50% of the sum of the
aggregate Term Loan Exposure of all Lenders.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Holdings or Borrower now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock to the holders of that class; (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of stock
of Holdings or Borrower now or hereafter outstanding; (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of stock of Holdings or Borrower now
or hereafter outstanding; (iv) management or similar fees payable to Sponsor or
any of its Affiliates; (v) any payment or prepayment of principal of, premium,
if any, or interest on, or redemption, purchase, repurchase, retirement,
defeasance (including in-substance or legal defeasance), sinking fund or similar
payment (or any offer to do any of the foregoing) with respect to the Senior
Subordinated Notes, the Refinancing Notes, the SAC Notes and any other
Indebtedness which is subordinated to the Term Obligations.
"REVOLVING COLLATERAL AGENT" means the "Collateral Agent" as
defined in the Revolving Credit Agreement or any collateral agent under a
Permitted Refinancing of the Revolving Credit Agreement.
"REVOLVING COMMITMENTS" means the Revolving Commitments under
(and as defined in) the Revolving Credit Agreement.
"REVOLVING COMMITMENT TERMINATION DATE" means the Revolving
Commitment Termination Date under (and as defined in) the Revolving Credit
Agreement.
"REVOLVING CREDIT AGREEMENT" means the Revolving Credit and
Guaranty Agreement, dated as of the date hereof, by and among Borrower, the
Guarantors, GSCP as Sole
25
Lead Arranger, Sole Bookrunner and Syndication Agent, and The CIT Group/Business
Credit, Inc., as Administrative Agent and Collateral Agent, with regard to
$35,000,000 in Revolving Loans, as it may be amended, supplemented or otherwise
modified from time to time.
"REVOLVING LOAN" means a Revolving Loan under (and as defined
in) the Revolving Credit Agreement and includes any Permitted Refinancings
thereof.
"REVOLVING OBLIGATIONS" means the Obligations under (and as
defined in) the Revolving Credit Agreement and includes any Permitted
Refinancings thereof.
"REVOLVING SECURED PARTIES" as defined in the Revolving Credit
Agreement, or any credit agreement or comparable document in respect of a
Permitted Refinancing of the Revolving Loans.
"REVOLVING PLEDGE AND SECURITY AGREEMENT" means the Pledge and
Security Agreement as defined in the Revolving Credit Agreement.
"S&P" means Standard & Poor's Ratings Group, a division of The
McGraw Hill Corporation.
"SAC NOTES" means the 10.25% Senior Subordinated Notes dated
as of December 11, 1997 by Stanadyne Automotive Corp., as issuer.
"SECOND PRIORITY" means, with respect to any Lien purported to
be created on any Collateral pursuant to any Collateral Document, that such Lien
is prior in right to any other Lien thereon, other than the First Priority Lien
in favor of the Collateral Agent for the benefit of the Revolving Secured
Parties and Permitted Liens described in clauses (b) through (f), (i), (j), (k),
(l) and (p) of Section 6.2 and that such Lien is subordinate to the First
Priority Lien in the manner set forth in the Intercreditor Agreement.
"SECURED PARTIES" means the Revolving Secured Parties and the
Term Secured Parties.
"SECURITIES" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"SELLERS" means American Industrial Partners Capital Fund II,
L.P., and the other stockholders of Stanadyne Automotive Holding Corp. set forth
on Schedule I to the Stock Purchase Agreement.
26
"SENIOR SUBORDINATED NOTE INDENTURE" means the Indenture dated
as of the date hereof pursuant to which Borrower has issued its Senior
Subordinated Notes due 2014, as such indenture may be further amended, restated,
supplemented, modified, extended, renewed or replaced from time to time in
accordance with Section 6.16 of this Agreement.
"SENIOR SUBORDINATED NOTES" means Borrower's unsecured Senior
Subordinated Notes due 2014, dated the date hereof, and any registered senior
subordinated notes having substantially identical terms and issued pursuant to
the Senior Subordinated Indenture in exchange for the initial, unregistered
Senior Subordinated Notes, together with any additional senior subordinated
notes issued under the Senior Subordinated Note Indenture after the Closing Date
and expressly permitted hereunder.
"SETTLEMENT CONFIRMATION" as defined in Section 10.6(b).
"SETTLEMENT SERVICE" as defined in Section 10.6(d).
"SOLE LEAD ARRANGER" as defined in the preamble hereto.
"SOLVENCY CERTIFICATE" means a Solvency Certificate of the
chief financial officer of Holdings substantially in the form of Exhibit G-2.
"SOLVENT" means, with respect to any Credit Party, that as of
the date of determination, both (i) (a) the sum of such Credit Party's debt
(including contingent liabilities) does not exceed the present fair saleable
value of such Credit Party's present assets; (b) such Credit Party's capital is
not unreasonably small in relation to its business as contemplated on the
Closing Date and reflected in the Projections or with respect to any transaction
contemplated or undertaken after the Closing Date; and (c) such Person has not
incurred and does not intend to incur, or believe (nor should it reasonably
believe) that it will incur, debts beyond its ability to pay such debts as they
become due (whether at maturity or otherwise); and (ii) such Person is "solvent"
within the meaning given that term and similar terms under applicable laws
relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability (irrespective of whether such contingent liabilities
meet the criteria for accrual under Statement of Financial Accounting Standard
No. 5).
"SPONSOR" means Kohlberg IV, L.P., its Control Investment
Affiliates, Co-Investment Partners, L.P., a Delaware limited partnership,
Massachusetts Mutual Life Insurance Company, a Massachusetts corporation, Tower
Square Capital Partners L.P., a Delaware limited partnership, National City
Equity Partners, LLC, an Ohio limited liability company, Xxxxxxxx Xxxx Private
Equity Fund V L.P., a Guernsey limited partnership, Antares Capital Corporation,
a Delaware corporation, Wilton Private Equity Fund, LLC, a Delaware limited
liability company, DuPont Pension Trust, a Massachusetts trust, and Xxxxx
Xxxxxxx, an individual.
"SPONSOR EQUITY" means the Capital Stock of Holdings purchased
by Sponsor on or prior to the Closing Date in an aggregate Cash amount equal to
not less than 26% of the Purchase Price (as defined in the Stock Purchase
Agreement).
27
"STOCK PURCHASE AGREEMENT" means the Stock Purchase Agreement
dated as of June 23, 2004 among KSTA Acquisition, LLC and the Sellers and other
parties thereto.
"SUBJECT TRANSACTION" as defined in Section 1.3.
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof; provided, in determining the percentage of ownership
interests of any Person controlled by another Person, no ownership interest in
the nature of a "qualifying share" of the former Person shall be deemed to be
outstanding.
"SWING LINE LOANS" means Swing Line Loans under (and as
defined in) the Revolving Credit Agreement and shall include any Permitted
Refinancings thereof.
"SYNDICATION AGENT" as defined in the preamble hereto.
"TAX" means any present or future tax, levy, impost, duty,
assessment, charge, fee, deduction or withholding of any nature and whatever
called, by whomsoever, on whomsoever and wherever imposed, levied, collected,
withheld or assessed; provided, "Tax on the overall net income" of a Person
shall (i) be construed as a reference to a tax imposed by the jurisdiction or
any subdivision thereof in which that Person is organized or in which that
Person's applicable principal office (and/or, in the case of a Lender, its
lending office) is located or in which that Person (and/or, in the case of a
Lender, its lending office) is deemed to be doing business (a "RELEVANT TAX
JURISDICTION") on all or part of the net income, profits or gains (whether
worldwide, or only insofar as such income, profits or gains are considered to
arise in or to relate to a particular jurisdiction, or otherwise) of that Person
(and/or, in the case of a Lender, its applicable lending office) and (ii)
include all franchise taxes, branch taxes, taxes on doing business or taxes on
the overall capital or net worth of any such Person (and/or in the case of a
Lender, its Principal Office), in each case imposed by any Relevant Tax
Jurisdiction in lieu of income, profits or gains taxes.
"TERM LOANS" means a Loan made by a Lender to Borrower
pursuant to Section 2.1(a).
"TERM LOAN EXPOSURE" means, with respect to any Lender as of
any date of determination, the aggregate outstanding principal amount of the
Term Loans of that Lender; provided, at any time prior to the making of the Term
Loans, the Term Loan Exposure of any Lender shall be equal to such Lender's
Commitment.
"TERM LOAN MATURITY DATE" means the sixth anniversary of the
Closing Date.
"TERM LOAN NOTE" means a promissory note in the form of
Exhibit B, as it may be amended, supplemented or otherwise modified from time to
time.
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"TERM OBLIGATIONS" means obligations of every nature of each
Credit Party from time to time owed to the Agents (including former Agents), the
Lenders or any of them, under any Credit Document, whether for principal,
interest (including interest which, but for the filing of a petition in
bankruptcy with respect to such Credit Party, would have accrued on any Term
Obligation, whether or not a claim is allowed against such Credit Party for such
interest in the related bankruptcy proceeding), fees, expenses, indemnification
(including, without limitation, pursuant to Section 10.3 hereof) or otherwise.
"TERM PLEDGE AND SECURITY AGREEMENT" means the Pledge and
Security Agreement, dated as of the Closing Date, by and among Borrower, each
Guarantor and Collateral Agent.
"TERM SECURED PARTIES" has the meaning assigned to such term
in the Term Pledge and Security Agreement.
"TERMINATED LENDER" as defined in Section 2.19.
"TITLE POLICY" as defined in Section 3.1(i).
"TRANSACTION COSTS" means the fees, costs and expenses
payable by Holdings, Borrower or any of Borrower's Subsidiaries on or before the
Closing Date in connection with the Transactions.
"TRANSACTIONS" means consummation of the Acquisition, the
contribution of Sponsor Equity, the completion of the Debt Tender, the
assumption of the Existing Capital Leases, the repayment of the Existing
Indebtedness, the entering into of this Agreement and the Revolving Credit
Agreement and the issuance of the Senior Subordinated Notes.
"TYPE OF LOAN" means either a Base Rate Loan or a Eurodollar
Rate Loan.
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"UNADJUSTED EURODOLLAR RATE COMPONENT" means that component of
the interest costs to Borrower in respect of a Eurodollar Rate Loan that is
based upon the rate obtained pursuant to clause (i) of the definition of
Adjusted Eurodollar Rate.
1.2. ACCOUNTING TERMS. Except as otherwise expressly provided herein,
all accounting terms not otherwise defined herein shall have the meanings
assigned to them in conformity with GAAP. Financial statements and other
information required to be delivered by Holdings to Lenders pursuant to Section
5.1(a), 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as in effect
at the time of such preparation (and delivered together with the reconciliation
statements provided for in Section 5.1(e), if applicable). For purposes of
calculating the Leverage Ratio all accounting terms herein shall be interpreted
and all accounting determinations hereunder (in each case, unless otherwise
provided for or defined herein) shall be made in accordance with GAAP as used in
the most recent of the annual financial statements referred to in Section 4.7
and applied on a basis consistent with the application used in the financial
statements referred to in Section 4.7; provided, further, that if Borrower
notifies Administrative
29
Agent that Borrower wishes to amend any covenant in Section 2.11 or the Leverage
Ratio or any related definition to eliminate the effect of any change in GAAP
occurring after the date of this Agreement on the operation of such covenant (or
if Administrative Agent notifies Borrower that the Requisite Lenders wish to
amend Section 2.11 or the Leverage Ratio or any related definition for such
purpose), then (i) Borrower and Administrative Agent shall negotiate in good
faith to agree upon an appropriate amendment to such covenant and (ii)
Borrower's compliance with such covenant and the Leverage Ratio shall be
determined on the basis of GAAP in effect immediately before the relevant change
in GAAP became effective until such covenant is amended in a manner satisfactory
to Borrower and the Requisite Lenders. For the purposes of determining
compliance under Sections 6.1, 6.2, 6.6 and 6.7 with respect to any amount in a
currency other than Dollars, such amount shall be deemed to equal the Dollar
equivalent thereof at the time such amount was incurred or expended, as the case
may be.
1.3. CERTAIN CALCULATIONS With respect to any period during which a
Permitted Acquisition or an Asset Sale has occurred (each, a "SUBJECT
TRANSACTION"), Consolidated Adjusted EBITDA (except with respect to calculations
of Consolidated Excess Cash Flow) shall be calculated with respect to such
period on a pro forma basis (including pro forma adjustments arising out of
events which are directly attributable to a specific transaction or which are to
be implemented by the business subject to that transaction or by Borrower and
its Subsidiaries as a result of such Subject Transaction, are factually
supportable and are expected to have a continuing impact, in each case
determined on a basis consistent with Article 11 of Regulation S-X promulgated
under the Securities Act and as interpreted by the staff of the Securities and
Exchange Commission or as otherwise reasonably approved by Administrative Agent,
which would include cost savings resulting from head count reduction, closure of
facilities and similar restructuring charges, which pro forma adjustments shall
be certified by the chief financial officer of Borrower) using the historical
financial statements of any business so acquired or to be acquired or sold or to
be sold and the consolidated financial statements of Borrower and its
Subsidiaries which shall be reformulated as if such Subject Transaction, and any
Indebtedness incurred or repaid in connection therewith, had been consummated or
incurred or repaid at the beginning of such period (and assuming that such
Indebtedness bears interest during any portion of the applicable measurement
period prior to the relevant acquisition at the weighted average of the interest
rates applicable to outstanding Loans incurred during such period).
1.5. INTERPRETATION, ETC. Any of the terms defined herein may, unless
the context otherwise requires, be used in the singular or the plural, depending
on the reference. References herein to any Section, Appendix, Schedule or
Exhibit shall be to a Section, an Appendix, a Schedule or an Exhibit, as the
case may be, hereof unless otherwise specifically provided. The use herein of
the word "include" or "including", when following any general statement, term or
matter, shall not be construed to limit such statement, term or matter to the
specific items or matters set forth immediately following such word or to
similar items or matters, whether or not non limiting language (such as "without
limitation" or "but not limited to" or words of similar import) is used with
reference thereto, but rather shall be deemed to refer to all other items or
matters that fall within the broadest possible scope of such general statement,
term or matter. In computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including", the words "to"
and "until" each mean "to but excluding", and the word "through" means "to and
including". Unless the context otherwise requires (i) any
30
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented and otherwise modified in accordance
with the terms hereof, (ii) any references herein to any Person shall be
construed to include such Person's successors and assigns, and (iii) the words
"herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof.
SECTION 2. LOANS
2.1. TERM LOANS.
(a) Term Loan Commitments. Subject to the terms and conditions
hereof, each Lender severally agrees to make a Term Loan on the Closing Date in
an amount equal to such Lender's Commitment. Borrower may make only one
borrowing under the Commitments, which shall be on the Closing Date. Any amount
borrowed pursuant to this Section 2.1(a) and subsequently repaid or prepaid may
not be reborrowed. Subject to Sections 2.10(a) and 2.11, all amounts owed
hereunder with respect to the Loans shall be repaid in full no later than the
Term Loan Maturity Date. Each Lender's Commitment shall terminate immediately
and without further action on the Closing Date after giving effect to the
funding of such Lender's Commitment on such date.
(b) Borrowing Mechanics for Term Loans.
(i) Borrower shall deliver to Administrative Agent a
fully executed and delivered Funding Notice no later
than (x) one Business Day prior to the Closing Date
in the case of a Base Rate Loan and (ii) three
Business Days prior to the Closing Date in the case
of a Eurodollar Rate Loan. Promptly upon receipt by
Administrative Agent of such certificate,
Administrative Agent shall notify each Lender of the
proposed borrowing.
(ii) Each Lender shall make its Term Loan available to
Administrative Agent no later than 12:00 p.m. (New
York City time) on the Closing Date by wire transfer
of same day funds in Dollars at the Principal Office
designated by Administrative Agent. Upon satisfaction
or waiver of the conditions precedent specified
herein, Administrative Agent shall make the proceeds
of the Term Loans available to Borrower on the
Closing Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Loans
received by Administrative Agent from Lenders to be
credited to the account of Borrower at the Principal
Office designated by Administrative Agent or to such
other account as may be designated in writing to
Administrative Agent by Borrower.
2.2. REPAYMENT.
The principal amounts of the Term Loans shall be repaid in
consecutive quarterly installments (each, an "INSTALLMENT") in the aggregate
amounts set forth below on each quarterly
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scheduled Interest Payment Date (each, an "INSTALLMENT DATE"), commencing
September 30, 2004 :
EACH INSTALLMENT DATE PRIOR TO AUGUST 6, $ 162,500
2010
TERM LOAN MATURITY DATE $61,100,000
Notwithstanding the foregoing, (x) such quarterly installments shall be
reduced in connection with any voluntary or mandatory prepayments of the Term
Loans in accordance with Sections 2.10, 2.11 and 2.12, as applicable, and (y)
the Term Loans, together with all other amounts owed hereunder with respect
thereto, shall, in any event, be paid in full no later than the Term Loan
Maturity Date.
2.3. PRO RATA SHARES; AVAILABILITY OF FUNDS.
(a) Pro Rata Shares. All Loans shall be made by Lenders
simultaneously and proportionately to their respective Pro Rata Shares, it being
understood that no Lender shall be responsible for any default by any other
Lender in such other Lender's obligation to make a Loan requested hereunder nor
shall any Commitment of any Lender be increased or decreased as a result of a
default by any other Lender in such other Lender's obligation to make a Loan
requested hereunder.
(b) Availability of Funds. Unless Administrative Agent shall
have been notified by any Lender prior to the Closing Date that such Lender does
not intend to make available to Administrative Agent the amount of such Lender's
Loan requested on the Closing Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on the Closing
Date and Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to Borrower a corresponding amount on the Closing
Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from the Closing Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Borrower and Borrower shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from the Closing Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans. Nothing
in this Section 2.3(b) shall be deemed to relieve any Lender from its obligation
to fulfill its Commitments hereunder or to prejudice any rights that Borrower
may have against any Lender as a result of any default by such Lender hereunder.
2.4. USE OF PROCEEDS. The proceeds of the Term Loans shall be applied
by Borrower to the repayment of the Existing Indebtedness outstanding on the
Closing Date. No portion of the
32
proceeds of the Term Loans shall be used in any manner that causes or might
cause such Term Loans or the application of such proceeds to violate Regulation
T, Regulation U or Regulation X of the Board of Governors of the Federal Reserve
System or any other regulation thereof or to violate the Exchange Act.
2.5. EVIDENCE OF DEBT; REGISTER; LENDERS' BOOKS AND RECORDS; NOTES.
(a) Lenders' Evidence of Debt. Each Lender shall maintain on
its internal records an account or accounts evidencing the Obligations of
Borrower to such Lender, including the amounts of the Loans made by it and each
repayment and prepayment in respect thereof. Any such recordation shall be
conclusive and binding on Borrower, absent manifest error; provided, that the
failure to make any such recordation, or any error in such recordation, shall
not affect Borrower's Obligations in respect of any applicable Loans; and
provided, further, in the event of any inconsistency between the Register and
any Lender's records, the recordations in the Register shall govern.
(b) Register. Administrative Agent (or its sub-agent appointed
by it) shall maintain at the Principal Office a register for the recordation of
the names and addresses of Lenders and Loans of each Lender from time to time
(the "REGISTER"). The Register, as in effect at the close of business on the
preceding Business Day, shall be available for inspection by Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice. Administrative Agent shall record, or shall cause to be recorded, in the
Register the Loans in accordance with the provisions of Section 10.6, and each
repayment or prepayment in respect of the principal amount of the Loans, and any
such recordation shall be conclusive and binding on Borrower and each Lender,
absent manifest error; provided, that the failure to make any such recordation,
or any error in such recordation, shall not affect Borrower's Obligations in
respect of any Loan. Borrower hereby designates GSCP to serve as Borrower's
agent solely for purposes of maintaining the Register as provided in this
Section 2.5, and Borrower hereby agrees that, to the extent GSCP serves in such
capacity, GSCP and its officers, directors, employees, agents, sub-agents and
affiliates shall constitute "Indemnitees."
(c) Notes. If so requested by any Lender by written notice to
Borrower (with a copy to Administrative Agent) at least two Business Days prior
to the Closing Date, or at any time thereafter, Borrower shall execute and
deliver to such Lender (and/or, if applicable and if so specified in such
notice, to any Person who is an assignee of such Lender pursuant to Section
10.6) on the Closing Date (or, if such notice is delivered after the Closing
Date, promptly after Borrower's receipt of such notice) a Note or Notes to
evidence such Lender's Loan.
2.6. INTEREST ON LOANS.
(a) Except as otherwise set forth herein, each Loan shall bear
interest on the unpaid principal amount thereof from the date made through
repayment (whether by acceleration or otherwise) thereof as follows:
(i) if a Base Rate Loan, at the Base Rate plus 2.50% or
(ii) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate plus 3.50%.
33
(b) The basis for determining the rate of interest with
respect to any Loan, and the Interest Period with respect to any Eurodollar Rate
Loan, shall be selected by Borrower and notified to Administrative Agent and
Lenders pursuant to the Funding Notice or a Conversion/Continuation Notice, as
the case may be; provided, until the earlier of thirty (30) days after the
Closing Date or the date that Syndication Agent notifies Borrower that the
primary syndication of the Loans has been completed, as reasonably determined by
Syndication Agent, the Term Loans shall be maintained as either (1) Eurodollar
Rate Loans having an Interest Period of no longer than one month or (2) Base
Rate Loans. If on any day a Loan is outstanding with respect to which a
Conversion/Continuation Notice has not been delivered to Administrative Agent in
accordance with the terms hereof specifying the applicable basis for determining
the rate of interest, then for that day such Loan shall be a Base Rate Loan.
(c) In connection with Eurodollar Rate Loans there shall be no
more than five (5) Interest Periods outstanding at any time. In the event
Borrower fails to specify between a Base Rate Loan or a Eurodollar Rate Loan in
the Funding Notice or a Conversion/Continuation Notice, such Loan (if
outstanding as a Eurodollar Rate Loan) will be automatically converted into a
Base Rate Loan on the last day of the then-current Interest Period for such Loan
(or if outstanding as a Base Rate Loan will remain as, or (if not then
outstanding) will be made as, a Base Rate Loan). In the event Borrower fails to
specify an Interest Period for any Eurodollar Rate Loan in the Funding Notice or
a Conversion/Continuation Notice, Borrower shall be deemed to have selected an
Interest Period of one month. As soon as practicable after 10:00 a.m. (New York
City time) on each Interest Rate Determination Date, Administrative Agent shall
determine (which determination shall, absent manifest error, be final,
conclusive and binding upon all parties) the interest rate that shall apply to
the Eurodollar Rate Loans for which an interest rate is then being determined
for the applicable Interest Period and shall promptly give notice thereof (in
writing or by telephone confirmed in writing) to Borrower and each Lender.
(d) Interest payable pursuant to Section 2.6(a) shall be
computed (i) in the case of Base Rate Loans based upon the Prime Rate on the
basis of a 365-day or 366-day year, as the case may be, and (ii) in the case of
Eurodollar Rate Loans or Base Rate Loans not based upon the Prime Rate, on the
basis of a 360-day year, in each case for the actual number of days elapsed in
the period during which it accrues. In computing interest on any Loan, the last
Interest Payment Date with respect to such Loan shall be included, and the date
of payment of such Loan or the expiration date of an Interest Period applicable
to such Loan or, with respect to a Base Rate Loan being converted to a
Eurodollar Rate Loan, the date of conversion of such Base Rate Loan to such
Eurodollar Rate Loan, as the case may be, shall be excluded; provided, if a Loan
is repaid on the same day on which it is made, one day's interest shall be paid
on that Loan.
(e) Except as otherwise set forth herein, interest on each
Loan (i) shall accrue on a daily basis on and to the March 31st, June 30th,
September 30th and December 31st most recently ended prior to such payment date
and shall be payable in arrears on each Interest Payment Date; (ii) shall accrue
on a daily basis and be payable in arrears upon any prepayment of that Loan,
whether voluntary or mandatory, to the extent accrued on the amount being
prepaid; and (iii) shall accrue on a daily basis and shall be payable in arrears
at maturity of the Loans, including final maturity of the Loans; provided,
however, with respect to any voluntary prepayment of a Base Rate Loan, accrued
interest shall instead be payable on the applicable Interest Payment Date.
34
2.7. CONVERSION/CONTINUATION.
(a) Subject to Section 2.15 and so long as no Default or Event
of Default shall have occurred and then be continuing, Borrower shall have the
option:
(i) to convert at any time all or any part
of any Loan equal to $1,000,000 and integral multiples of $100,000 in
excess of that amount from one Type of Loan to another Type of Loan;
provided, a Eurodollar Rate Loan may only be converted on the
expiration of the Interest Period applicable to such Eurodollar Rate
Loan unless Borrower shall pay all amounts due under Section 2.15 in
connection with any such conversion; or
(ii) upon the expiration of any Interest
Period applicable to any Eurodollar Rate Loan, to continue all or any
portion of such Loan equal to $1,000,000 and integral multiples of
$100,000 in excess of that amount as a Eurodollar Rate Loan.
(b) Borrower shall deliver a Conversion/Continuation Notice to
Administrative Agent no later than 10:00 a.m. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan). Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, any
Eurodollar Rate Loans (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and
Borrower shall be bound to effect a conversion or continuation in accordance
therewith.
2.8. DEFAULT INTEREST. The principal amount of all Loans not paid when
due and, to the extent permitted by applicable law, any interest payments on the
Loans or any fees or other amounts owed hereunder not paid when due, shall
thereafter bear interest (including post-petition interest in any proceeding
under the Bankruptcy Code or other applicable bankruptcy laws) payable on demand
at a rate that is 2.0% per annum in excess of the interest rate otherwise
payable hereunder with respect to the applicable Loans (or, in the case of any
such fees and other amounts, at a rate which is 2.0% per annum in excess of the
highest interest rate otherwise then payable hereunder for Base Rate Loans);
provided, in the case of Eurodollar Rate Loans, upon the expiration of the
Interest Period in effect at the time any such increase in interest rate is
effective such Eurodollar Rate Loans shall thereupon become Base Rate Loans and
shall thereafter bear interest payable upon demand at a rate which is 2.0% per
annum in excess of the highest interest rate otherwise then payable hereunder
for Base Rate Loans. Payment or acceptance of the increased rates of interest
provided for in this Section 2.8 is not a permitted alternative to timely
payment and shall not constitute a waiver of any Event of Default or otherwise
prejudice or limit any rights or remedies of Administrative Agent or any Lender.
2.9. FEES.
Borrower agrees to pay to Agents such fees in the amounts and at
the times separately agreed upon.
35
2.10. VOLUNTARY PREPAYMENTS/CALL PROTECTION.
(a) Voluntary Prepayments.
(i) Any time and from time to time (but subject to
clause (b) below):
(1) with respect to Base Rate Loans,
Borrower may prepay any such Loans on any Business Day in
whole or in part, in an aggregate minimum amount of $500,000
and integral multiples of $100,000 in excess of that amount;
and
(2) with respect to Eurodollar Rate Loans,
Borrower may prepay any such Loans on any Business Day in
whole or in part in an aggregate minimum amount of $1,000,000
and integral multiples of $100,000 in excess of that amount.
(ii) All such prepayments shall be made:
(1) upon not less than one Business Day's
prior written or telephonic notice in the case of Base Rate
Loans; and
(2) upon not less than three Business Days'
prior written or telephonic notice in the case of Eurodollar
Rate Loans;
in each case given to Administrative Agent, by 12:00 p.m. (New York City time)
on the date required and, if given by telephone, promptly confirmed in writing
to Administrative Agent (and Administrative Agent will promptly transmit such
telephonic or original notice for Term Loans, as the case may be, by
telefacsimile or telephone promptly confirmed in writing to each Lender). Upon
the giving of any such notice, the principal amount of the Loans specified in
such notice shall become due and payable on the prepayment date specified
therein. Any such voluntary prepayment shall be applied as specified in Section
2.12(a).
(b) Call Protection. In the event that the Term Loans are
prepaid or repaid in whole or in part pursuant to clause (a) above prior to the
second anniversary of the Closing Date, Borrower shall pay to Lenders having
Term Loan Exposure a prepayment premium on the principal amount so prepaid or
repaid as follows:
PREPAYMENT PREMIUM AS A PERCENTAGE OF
PAYMENT DATE THE PRINCIPAL AMOUNT SO PREPAID OR REPAID
-----------------------------------------------------------------------------------------
On or prior to the first anniversary of the 2.0%
Closing Date
36
On or prior to the second anniversary of the 1.0%
Closing Date but after the first anniversary
of the Closing Date
2.11. MANDATORY PREPAYMENTS/COMMITMENT REDUCTIONS.
(a) Asset Sales. Subject to Section 2.12(b), no later than the
first Business Day following the date of receipt by Holdings or any of its
Subsidiaries of any Net Asset Sale Proceeds, Borrower shall prepay the Loans and
the Commitments shall be permanently reduced as set forth in Section 2.12(b) in
an aggregate amount equal to such amount of Net Asset Sale Proceeds; provided,
so long as no Default or Event of Default shall have occurred and be continuing,
Borrower shall have the option, directly or through one or more of its
Subsidiaries, to invest Net Asset Sale Proceeds within three hundred-sixty (360)
days of receipt thereof in productive assets used in the business of Borrower
and its Subsidiaries; provided, further, if required under the Revolving Credit
Agreement, pending any such investment all such Net Asset Sale Proceeds shall be
applied to prepay Revolving Loans to the extent outstanding (without a reduction
in Revolving Commitments).
(b) Insurance/Condemnation Proceeds. Subject to Section
2.12(b), no later than the first Business Day following the date of receipt by
Holdings or any of its Subsidiaries, or Administrative Agent as loss payee, of
any Net Insurance/Condemnation Proceeds in excess of $1,000,000 during any
Fiscal Year, Borrower shall prepay the Loans and/or the Commitments shall be
permanently reduced as set forth in Section 2.12(b) in an aggregate amount equal
to such amount of Net Insurance/Condemnation Proceeds; provided, so long as no
Default or Event of Default shall have occurred and be continuing, Borrower
shall have the option, directly or through one or more of its Subsidiaries to
invest such Net Insurance/Condemnation Proceeds within three hundred-sixty (360)
days of receipt thereof in productive assets used in the business of Holdings
and its Subsidiaries, which investment may include the repair, restoration or
replacement of the applicable assets in respect thereof; provided, further, if
required under the Revolving Credit Agreement, pending any such investment all
such Net Insurance/Condemnation Proceeds, as the case may be, shall be applied
to prepay Revolving Loans to the extent outstanding (without a reduction in
Revolving Commitments).
(c) Issuance of Equity Securities. Subject to Section 2.12(b),
on the date of receipt by Holdings of any Cash proceeds from a capital
contribution to, or the issuance of any Capital Stock of, Holdings (other than
(i) pursuant to any employee stock or stock option compensation plan, (ii)
equity issued to Sponsor, all or substantially all of the Cash proceeds of which
are utilized by Borrower for capital expenditures permitted hereunder or
Investments otherwise permitted hereunder, or (iii) equity issued pursuant to
Section 8.2 hereof), Borrower shall prepay the Loans and the Commitments shall
be permanently reduced as set forth in Section 2.12(b) in an aggregate amount
equal to 75.0% of such proceeds, net of underwriting discounts and commissions
and other reasonable costs and expenses associated therewith payable to a Person
that is not Holdings or one of its Affiliates (except Sponsor, provided such
reasonable costs and expenses payable to Sponsor were approved by the
disinterested members
37
of the Borrower's board of directors and it is a one-time fee), including
reasonable legal fees and expenses, provided, during any period in which the
Leverage Ratio (determined for any such period by reference to the most recent
Compliance Certificate delivered pursuant to Section 5.1(d) calculating the
Leverage Ratio) shall be 3.00:1.00 or less, Borrower shall only be required to
make the prepayments and/or reductions otherwise required by this Section
2.11(c) in an amount equal to 50.0% of such proceeds, net of underwriting
discounts and commissions and other reasonable costs and expenses associated
therewith payable to a Person that is not Holdings or one of its Subsidiaries or
Affiliates (except Sponsor, provided such reasonable costs and expenses payable
to Sponsor were approved by the disinterested members of the Borrower's board of
directors and it is a one-time fee).
(d) Issuance of Debt. Subject to Section 2.12(b), no later
than the first Business Day following the date of receipt by Holdings or any of
its Subsidiaries of any Cash proceeds from the incurrence of any Indebtedness of
Holdings or any of its Subsidiaries (other than with respect to any Indebtedness
permitted to be incurred pursuant to Section 6.1 (except for Indebtedness
incurred pursuant to Section 6.1(k) the proceeds of which are not used to prepay
the Senior Subordinated Notes), but expressly including the proceeds of any sale
and leaseback pursuant to Section 6.11), Borrower shall prepay the Loans and/or
the Commitments shall be permanently reduced as set forth in Section 2.12(b) in
an aggregate amount equal to 100% of such proceeds, net of underwriting
discounts and commissions and other reasonable costs and expenses associated
therewith payable to a Person that is not Holdings or one of its Subsidiaries or
Affiliates (except Sponsor, provided such reasonable costs and expenses payable
to Sponsor were approved by the disinterested members of the Borrower's board of
directors and it is a one-time fee), including reasonable legal fees and
expenses.
(e) Consolidated Excess Cash Flow. Subject to Section 2.12(b),
in the event that there shall be Consolidated Excess Cash Flow for any Fiscal
Year (commencing with Fiscal Year 2005), Borrower shall, no later than one
hundred-twenty five (125) days after the end of such Fiscal Year, prepay the
Loans and the Commitments shall be permanently reduced as set forth in Section
2.12(b) in an aggregate amount equal to (i) 75.0% of such Consolidated Excess
Cash Flow minus (ii) optional prepayments of the Term Loans and to the extent of
a Revolving Commitment reduction, Revolving Loans, in each case, during such
Fiscal Year; provided, during any period in which the Leverage Ratio (determined
for any such period by reference to the most recent Compliance Certificate
delivered pursuant to Section 5.1(d) calculating the Leverage Ratio) shall be
3.00:1.00 or less, Borrower shall only be required to make the prepayments
and/or reductions otherwise required by this Section 2.11(e) in an amount equal
to 50.0% of such Consolidated Excess Cash Flow.
(f) Prepayment Certificate. Concurrently with any prepayment
of the Loans and/or reduction of the Commitments pursuant to Sections 2.11(a)
through 2.11(e), Borrower shall deliver to Administrative Agent a certificate of
an Authorized Officer demonstrating the calculation of the amount of the
applicable net proceeds or Consolidated Excess Cash Flow, as the case may be. In
the event that Borrower shall subsequently determine that the actual amount
received exceeded the amount set forth in such certificate, Borrower shall
promptly make an additional prepayment of the Loans and/or the Commitments shall
be permanently reduced in an amount equal to such excess as set forth in Section
2.12(b), and Borrower shall concurrently
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therewith deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the derivation of such excess.
2.12. APPLICATION OF PREPAYMENTS/REDUCTIONS.
(a) Application of Voluntary Prepayments by Type of
Loans. Any prepayment of any Loan pursuant to Section 2.12(a) shall be applied
first, on a pro rata basis to reduce the scheduled Installments of principal of
such Term Loans during the next twelve months, and second, on a pro rata basis,
to reduce the remaining scheduled Installments of principal of such Term Loans.
Application of Mandatory Prepayments by Type of
Loans. Any amount required to be paid pursuant to Sections 2.11(a)
through 2.11(e) shall be applied to prepay Term Loans to the full
extent thereof (to be applied first, on a pro rata basis to reduce the
scheduled Installments of principal of such Term Loans during the next
twelve months, and second, on a pro rata basis, to reduce the remaining
scheduled Installments of principal of such Term Loans).
(b) Application of Prepayments of Loans to Base Rate
Loans and Eurodollar Rate Loans. Any prepayment thereof shall be applied first
to Base Rate Loans to the full extent thereof before application to Eurodollar
Rate Loans, in each case in a manner which minimizes the amount of any payments
required to be made by Borrower pursuant to Section 2.15(c).
2.13. GENERAL PROVISIONS REGARDING PAYMENTS.
(a) All payments by Borrower of principal, interest, fees and
other Obligations shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than 12:00 p.m. (New York City time) on the date
due at the Principal Office designated by Administrative Agent for the account
of Lenders; for purposes of computing interest and fees, funds received by
Administrative Agent after that time on such due date shall be deemed to have
been paid by Borrower on the next succeeding Business Day.
(b) All payments in respect of the principal amount of any
Loan shall be accompanied by payment of accrued interest on the principal amount
being repaid or prepaid.
(c) Administrative Agent (or its agent or sub-agent appointed
by it) shall promptly distribute to each Lender at such address as such Lender
shall indicate in writing such Lender's applicable Pro Rata Share of all
payments and prepayments of principal and interest due hereunder, together with
all other amounts due to such Lender, including, without limitation, all fees
payable to such Lender with respect thereto, to the extent received by
Administrative Agent.
(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning payments received thereafter.
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(e) Subject to the provisos set forth in the definition of
"Interest Period", whenever any payment to be made hereunder shall be stated to
be due on a day that is not a Business Day, such payment shall be made on the
next succeeding Business Day.
(f) Borrower hereby authorizes Administrative Agent to charge
Borrower's accounts with Administrative Agent in order to cause timely payment
to be made to Administrative Agent of all principal, interest, fees and expenses
due hereunder (subject to sufficient funds being available in its accounts for
that purpose).
(g) Administrative Agent shall deem any payment by or on
behalf of Borrower hereunder that is not made in same day funds prior to 12:00
p.m. (New York City time) to be a non-conforming payment. Any such payment shall
not be deemed to have been received by Administrative Agent until the later of
(i) the time such funds become available funds, and (ii) the applicable next
Business Day. Administrative Agent shall give prompt telephonic notice to
Borrower and each applicable Lender (confirmed in writing) if any payment is
non-conforming. Any non-conforming payment may constitute or become a Default or
Event of Default in accordance with the terms of Section 8.1(a). Interest shall
continue to accrue on any principal as to which a non-conforming payment is made
until such funds become available funds (but in no event less than the period
from the date of such payment to the next succeeding applicable Business Day) at
the rate determined pursuant to Section 2.7 from the date such amount was due
and payable until the date such amount is paid in full.
(h) If an Event of Default shall have occurred and not
otherwise been waived, and the maturity of the Obligations shall have been
accelerated pursuant to Section 8.1, all payments or proceeds received by Agents
hereunder in respect of any of the Obligations, including from payments or
proceeds in respect of any sale, or any collection from, or other realization
upon, all or any part of the Collateral, shall be applied, subject to the terms
of the Intercreditor Agreement, as follows:
(i) first, to the payment of all costs and expenses
of any such sale, collection or other realization, including reasonable
compensation to the Collateral Agent and its agents and counsel, and
all other expenses, liabilities and advances made or incurred by the
Collateral Agent in connection therewith, and all amounts for which the
Collateral Agent is entitled to indemnification hereunder or under the
Term Pledge and Security Agreement (in its capacity as the Collateral
Agent and not as a Lender) and all advances made by the Collateral
Agent under the Term Pledge and Security Agreement for the account of
the applicable Grantor, and to the payment of all costs and expenses
paid or incurred by the Collateral Agent in connection with the
exercise of any right or remedy hereunder or under the Term Pledge and
Security Agreement, all in accordance with the terms hereof or thereof;
(ii) second, to the extent of any excess of such
proceeds, to the payment of all other Obligations for the ratable
benefit of the Lenders and the Lender Counterparties in such order as
they may elect; and
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(iii) third, to the extent of any excess of such
proceeds, to the payment to or upon the order of the applicable Credit
Party or to whosoever may be lawfully entitled to receive the same or
as a court of competent jurisdiction may direct.
2.14. RATABLE SHARING. Lenders hereby agree among themselves that,
except as otherwise provided in the Collateral Documents with respect to amounts
realized from the exercise of rights with respect to Liens on the Collateral, if
any of them shall, whether by voluntary payment (other than a voluntary
prepayment of Loans made and applied in accordance with the terms hereof),
through the exercise of any right of set-off or banker's lien, by counterclaim
or cross action or by the enforcement of any right under the Credit Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under the Bankruptcy Code, receive payment or reduction of a proportion of the
aggregate amount of principal, interest, fees and other amounts then due and
owing to such Lender hereunder or under the other Credit Documents
(collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) which is greater than
the proportion received by any other Lender in respect of the Aggregate Amounts
Due to such other Lender, then the Lender receiving such proportionately greater
payment shall (a) notify Administrative Agent and each other Lender of the
receipt of such payment and (b) apply a portion of such payment to purchase
participations (which it shall be deemed to have purchased from each seller of a
participation simultaneously upon the receipt by such seller of its portion of
such payment) in the Aggregate Amounts Due to the other Lenders so that all such
recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion
to the Aggregate Amounts Due to them; provided, if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender upon the bankruptcy or reorganization of Borrower or
otherwise (and whether as a result of any demand, settlement, litigation or
otherwise), those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such purchasing Lender ratably to the
extent of such recovery, but without interest. Borrower expressly consents to
the foregoing arrangement and agrees that any holder of a participation so
purchased may exercise any and all rights of banker's lien, set-off or
counterclaim with respect to any and all monies owing by Borrower to that holder
with respect thereto as fully as if that holder were owed the amount of the
participation held by that holder directly by Borrower.
2.15. MAKING OR MAINTAINING EURODOLLAR RATE LOANS.
(a) Inability to Determine Applicable Interest Rate. In the
event that Administrative Agent shall have reasonably determined (which
determination shall be final and conclusive and binding upon all parties
hereto), on any Interest Rate Determination Date with respect to any Eurodollar
Rate Loans, that by reason of circumstances affecting the London interbank
market adequate and fair means do not exist for ascertaining the interest rate
applicable to such Loans on the basis provided for in the definition of Adjusted
Eurodollar Rate, Administrative Agent shall on such date give notice (by
telefacsimile or by telephone confirmed in writing) to Borrower and each Lender
of such determination, whereupon (i) no Loans may be made as, or converted to,
Eurodollar Rate Loans until such time as Administrative Agent notifies Borrower
and Lenders that the circumstances giving rise to such notice no longer exist,
and (ii) any Conversion/Continuation Notice given by Borrower with respect to
the Loans in respect of which such determination was made shall be deemed to be
rescinded by Borrower.
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(b) Illegality or Impracticability of Eurodollar Rate Loans.
In the event that on any date any Lender shall have determined (which
determination shall be final and conclusive and binding upon all parties hereto
but shall be made only after consultation with Borrower and Administrative
Agent) that the making, maintaining or continuation of its Eurodollar Rate Loans
(i) has become unlawful as a result of compliance by such Lender in good faith
with any law, treaty, governmental rule, regulation, guideline or order (or
would conflict with any such treaty, governmental rule, regulation, guideline or
order not having the force of law even though the failure to comply therewith
would not be unlawful), or (ii) has become impracticable, as a result of
contingencies occurring after the date hereof which materially and adversely
affect the London interbank market or the position of such Lender in that
market, then, and in any such event, such Lender shall be an "AFFECTED LENDER"
and it shall on that day give notice (by telefacsimile or by telephone confirmed
in writing) to Borrower and Administrative Agent of such determination (which
notice Administrative Agent shall promptly transmit to each other Lender).
Thereafter (1) the obligation of the Affected Lender to make Loans as, or to
convert Loans to, Eurodollar Rate Loans shall be suspended until such notice
shall be withdrawn by the Affected Lender, (2) to the extent such determination
by the Affected Lender relates to a Eurodollar Rate Loan then being requested by
Borrower pursuant to a Conversion/Continuation Notice, the Affected Lender shall
make such Loan as (or continue such Loan as or convert such Loan to, as the case
may be) a Base Rate Loan, (3) the Affected Lender's obligation to maintain its
outstanding Eurodollar Rate Loans (the "AFFECTED LOANS") shall be terminated at
the earlier to occur of the expiration of the Interest Period then in effect
with respect to the Affected Loans or when required by law, and (4) the Affected
Loans shall automatically convert into Base Rate Loans on the date of such
termination. Notwithstanding the foregoing, to the extent a determination by an
Affected Lender as described above relates to a Eurodollar Rate Loan then being
requested by Borrower pursuant to a Funding Notice or a Conversion/Continuation
Notice, Borrower shall have the option, subject to the provisions of Section
2.15(c), to rescind such Funding Notice or Conversion/Continuation Notice as to
all Lenders by giving notice (by telefacsimile or by telephone confirmed in
writing) to Administrative Agent of such rescission on the date on which the
Affected Lender gives notice of its determination as described above (which
notice of rescission Administrative Agent shall promptly transmit to each other
Lender). Except as provided in the immediately preceding sentence, nothing in
this Section 2.15(b) shall affect the obligation of any Lender other than an
Affected Lender to make or maintain Loans as, or to convert Loans to, Eurodollar
Rate Loans in accordance with the terms hereof.
(c) Compensation for Breakage or Non-Commencement of Interest
Periods. Borrower shall compensate each Lender, upon written request by such
Lender (which request shall set forth the basis for requesting such amounts),
for all reasonable losses, expenses and liabilities (including any interest paid
by such Lender to lenders of funds borrowed by it to make or carry its
Eurodollar Rate Loans and any loss, expense or liability sustained by such
Lender in connection with the liquidation or re-employment of such funds but
excluding loss of anticipated profits (including, without limitation, the
Applicable Margin)) which such Lender may sustain: (i) if for any reason (other
than a default by such Lender) a borrowing of any Eurodollar Rate Loan does not
occur on a date specified therefor in a Funding Notice or a telephonic request
for borrowing, or a conversion to or continuation of any Eurodollar Rate Loan
does not occur on a date specified therefor in a Conversion/Continuation Notice
or a telephonic request for conversion or continuation; (ii) if any prepayment
or other principal payment of, or any conversion of, any of its Eurodollar Rate
Loans occurs on a date prior to the last day of an
42
Interest Period applicable to that Loan; or (iii) if any prepayment of any of
its Eurodollar Rate Loans is not made on any date specified in a notice of
prepayment given by Borrower.
(d) Booking of Eurodollar Rate Loans. Any Lender may make,
carry or transfer Eurodollar Rate Loans at, to, or for the account of any of its
branch offices or the office of an Affiliate of such Lender.
(e) Assumptions Concerning Funding of Eurodollar Rate Loans.
Calculation of all amounts payable to a Lender under this Section 2.15 and under
Section 2.16 shall be made as though such Lender had actually funded each of its
relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit
bearing interest at the rate obtained pursuant to clause (i) of the definition
of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of such
Lender to a domestic office of such Lender in the United States of America;
provided, however, each Lender may fund each of its Eurodollar Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this Section 2.15 and under
Section 2.16.
2.16. INCREASED COSTS; CAPITAL ADEQUACY.
(a) Compensation For Increased Costs and Taxes. Subject to the
provisions of Section 2.17 (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmental rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the introduction of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
Governmental Authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law): (i)
subjects such Lender (or its applicable lending office) to any additional Tax
(other than any Tax on the overall net income of such Lender) with respect to
this Agreement or any of the other Credit Documents or any of its obligations
hereunder or thereunder or any payments to such Lender (or its applicable
lending office) of principal, interest, fees or any other amount payable
hereunder; (ii) imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special deposit,
compulsory loan, FDIC insurance or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, or advances or loans
by, or other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other requirements with
respect to Eurodollar Rate Loans that are reflected in the definition of
Adjusted Eurodollar Rate); or (iii) imposes any other condition (other than with
respect to a Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the London interbank market; and the
result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrower shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
43
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrower (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this Section
2.16(a), which statement shall be conclusive and binding upon all parties hereto
absent manifest error. Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender's right to demand such compensation; provided that Borrower shall not be
required to compensate a Lender pursuant to this Section for any increased costs
incurred or reductions suffered more than nine months prior to the date that
such Lender, as the case may be, notifies Borrower of the change giving rise to
such increased costs or reductions and of such Lender's intention to claim
compensation therefor (except that, if the change giving rise to such increased
costs or reductions is retroactive, then the nine-month period referred to above
shall be extended to include the period of retroactive effect thereof).
(b) Capital Adequacy Adjustment. In the event that any Lender
shall have determined that the adoption, effectiveness, phase-in or
applicability after the Closing Date of any law, rule or regulation (or any
provision thereof) regarding capital adequacy, or any change therein or in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or its applicable lending office) with any
guideline, request or directive regarding capital adequacy (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on the capital of such Lender or any Person controlling such Lender as a
consequence of, or with reference to, such Lender's Loans or other obligations
hereunder with respect to the Loans to a level below that which such Lender or
such controlling Person could have achieved but for such adoption,
effectiveness, phase-in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling Person with regard
to capital adequacy), then from time to time, within five Business Days after
receipt by Borrower from such Lender of the statement referred to in the next
sentence, Borrower shall pay to such Lender such additional amount or amounts as
will compensate such Lender or such controlling Person on an after-tax basis for
such reduction. Such Lender shall deliver to Borrower (with a copy to
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to Lender under this
Section 2.16(b), which statement shall be conclusive and binding upon all
parties hereto absent manifest error. Notwithstanding the foregoing, Borrower
shall not be required to compensate a Lender pursuant to this Section for any
increased costs incurred or reductions suffered more than nine months prior to
the date that such Lender, as the case may be, notifies Borrower of the change
giving rise to such increased costs or reductions and of such Lender's intention
to claim compensation therefor (except that, if the change giving rise to such
increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect
thereof).
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2.17. TAXES; WITHHOLDING, ETC.
(a) Payments to Be Free and Clear. All sums payable by any
Credit Party hereunder and under the other Credit Documents shall (except to the
extent required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a Tax on the overall net income
of any Lender) imposed, levied, collected, withheld or assessed by or within the
United States of America or any political subdivision in or of the United States
of America or any other jurisdiction from or to which a payment is made by or on
behalf of any Credit Party or by any federation or organization of which the
United States of America or any such jurisdiction is a member at the time of
payment.
(b) Withholding of Taxes. If any Credit Party or any other
Person is required by law to make any deduction or withholding on account of any
Tax (other than a Tax on the overall net income of any Lender) from any sum paid
or payable by any Credit Party to Administrative Agent or any Lender under any
of the Credit Documents:
(i) Borrower shall notify Administrative
Agent of any such requirement or any change in any such requirement as
soon as Borrower becomes aware of it;
(ii) Borrower shall pay any such Tax before
the date on which penalties attach thereto, such payment to be made (if
the liability to pay is imposed on any Credit Party) for its own
account or (if that liability is imposed on Administrative Agent or
such Lender, as the case may be) on behalf of and in the name of
Administrative Agent or such Lender;
(iii) the sum payable by such Credit Party
in respect of which the relevant deduction, withholding or payment is
required shall be increased to the extent necessary to ensure that,
after the making of that deduction, withholding or payment,
Administrative Agent or such Lender, as the case may be, receives on
the due date a net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and
(iv) within thirty days after paying any sum
from which it is required by law to make any deduction or withholding,
and within thirty days after the due date of payment of any Tax which
it is required by clause (ii) above to pay, Borrower shall deliver to
Administrative Agent evidence satisfactory to the other affected
parties of such deduction, withholding or payment and of the remittance
thereof to the relevant taxing or other authority;
provided, no such additional amount shall be required to be paid to any Lender
under clause (iii) above except to the extent that any change after the date
hereof (in the case of each Lender listed on the signature pages hereof on the
Closing Date) or after the effective date of the Assignment Agreement pursuant
to which such Lender became a Lender (in the case of each other Lender) in any
such requirement for a deduction, withholding or payment as is mentioned therein
shall result in an increase in the rate of such deduction, withholding or
payment from that in effect at
45
the date hereof or at the date of such Assignment Agreement, as the case may be,
in respect of payments to such Lender.
(c) Evidence of Exemption From U.S. Withholding Tax. Each
Lender that is not a United States Person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes
(a "NON-US LENDER") shall deliver to Administrative Agent for transmission to
Borrower, on or prior to the Closing Date (in the case of each Lender listed on
the signature pages hereof on the Closing Date) or on or prior to the date of
the Assignment Agreement pursuant to which it becomes a Lender (in the case of
each other Lender), and at such other times as may be necessary in the
determination of Borrower or Administrative Agent (each in the reasonable
exercise of its discretion), (i) two original copies of Internal Revenue Service
Form W-8ECI (or any successor forms), properly completed and duly executed by
such Lender, and such other documentation required under the Internal Revenue
Code and reasonably requested by Borrower to establish that such Lender is not
subject to deduction or withholding of United States federal income tax with
respect to any payments to such Lender of principal, interest, fees or other
amounts payable under any of the Credit Documents, or (ii) if such Lender is not
a "bank" or other Person described in Section 881(c)(3) of the Internal Revenue
Code and cannot deliver either Internal Revenue Service Form W-8BEN or W-8ECI
pursuant to clause (i) above, a Certificate re Non-Bank Status together with two
original copies of Internal Revenue Service Form W-8BEN (or any successor form),
properly completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and reasonably requested
by Borrower to establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to any payments to
such Lender of interest payable under any of the Credit Documents. Each Lender
required to deliver any forms, certificates or other evidence with respect to
United States federal income tax withholding matters pursuant to this Section
2.17(c) hereby agrees, from time to time after the initial delivery by such
Lender of such forms, certificates or other evidence, whenever a lapse in time
or change in circumstances renders such forms, certificates or other evidence
obsolete or inaccurate in any material respect, that such Lender shall promptly
deliver to Administrative Agent for transmission to Borrower two new original
copies of Internal Revenue Service Form W-8BEN or W-8ECI, or a Certificate re
Non-Bank Status and two original copies of Internal Revenue Service Form W-8BEN
(or any successor form), as the case may be, properly completed and duly
executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Borrower to confirm or
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to payments to such Lender under the
Credit Documents, or notify Administrative Agent and Borrower of its inability
to deliver any such forms, certificates or other evidence. Borrower shall not be
required to pay any additional amount to any Non-US Lender under Section
2.17(b)(iii) if such Lender shall have failed (1) to deliver the forms,
certificates or other evidence referred to in the second sentence of this
Section 2.17(c), or (2) to notify Administrative Agent and Borrower of its
inability to deliver any such forms, certificates or other evidence, as the case
may be; provided, if such Lender shall have satisfied the requirements of the
first sentence of this Section 2.17(c) on the Closing Date or on the date of the
Assignment Agreement pursuant to which it became a Lender, as applicable,
nothing in this last sentence of Section 2.17(c) shall relieve Borrower of its
obligation to pay any additional amounts pursuant this Section 2.17 in the event
that, as a result of any change in any applicable law, treaty or governmental
rule, regulation or order, or any change in the interpretation, administration
or
46
application thereof, such Lender is no longer properly entitled to deliver
forms, certificates or other evidence at a subsequent date establishing the fact
that such Lender is not subject to withholding as described herein.
(d) If and to the extent that any Lender is able, in its sole
opinion, to receive any tax refund arising out of or in conjunction with any
deduction or withholding which gives rise to an obligation of Borrower to pay
any Tax (other than a Tax on the overall net income of any Lender) pursuant to
this Section 2.17 then such Lender shall, to the extent that in its sole opinion
it can do so without prejudice to the retention of the refund and without any
other adverse tax consequences for such Lender, reimburse to Borrower at such
time as such refund shall have actually been received by such Lender such amount
as such Lender shall, in its sole opinion, have determined to be attributable to
the relevant deduction or withholding and as will leave such Lender in no better
or worse position than it would have been in if the payment of such Tax had not
been required.
2.18. OBLIGATION TO MITIGATE. Each Lender agrees that, as promptly as
practicable after the officer of such Lender responsible for administering its
Loans, becomes aware of the occurrence of an event or the existence of a
condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender to receive payments under Section 2.15, 2.16 or 2.17,
it will, to the extent not inconsistent with the internal policies of such
Lender and any applicable legal or regulatory restrictions, use reasonable
efforts to (a) make, issue, fund or maintain its Credit Extensions, including
any Affected Loans, through another office of such Lender, or (b) take such
other measures as such Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender pursuant to Section 2.15, 2.16 or 2.17 would be materially
reduced and if, as determined by such Lender in its sole discretion, the making,
issuing, funding or maintaining of such Loans through such other office or in
accordance with such other measures, as the case may be, would not otherwise
adversely affect such Loans or the interests of such Lender; provided, such
Lender will not be obligated to utilize such other office pursuant to this
Section 2.18 unless Borrower agrees to pay all incremental expenses incurred by
such Lender as a result of utilizing such other office as described in clause
(i) above. A certificate as to the amount of any such expenses payable by
Borrower pursuant to this Section 2.18 (setting forth in reasonable detail the
basis for requesting such amount) submitted by such Lender to Borrower (with a
copy to Administrative Agent) shall be conclusive absent manifest error.
2.19. REMOVAL OR REPLACEMENT OF A LENDER. Anything contained herein to
the contrary notwithstanding, in the event that: (a) (i) any Lender (an
"INCREASED-COST LENDER") shall give notice to Borrower that such Lender is an
Affected Lender or that such Lender is entitled to receive payments under
Section 2.15, 2.16 or 2.17, (ii) the circumstances which have caused such Lender
to be an Affected Lender or which entitle such Lender to receive such payments
shall remain in effect, and (iii) such Lender shall fail to withdraw such notice
within five Business Days after Borrower's request for such withdrawal; or (b)
in connection with any proposed amendment, modification, termination, waiver or
consent with respect to any of the provisions hereof as contemplated by Section
10.5(b), the consent of Requisite Lenders shall have been obtained but the
consent of one or more of such other Lenders (each a "NON-CONSENTING LENDER")
whose consent is required shall not have been obtained; then, with
47
respect to each such Increased-Cost Lender or Non-Consenting Lender (the
"TERMINATED LENDER"), Borrower may, by giving written notice to Administrative
Agent and any Terminated Lender of its election to do so, elect to cause such
Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to
assign its outstanding Loans, if any, in full to one or more Eligible Assignees
(each a "REPLACEMENT LENDER") in accordance with the provisions of Section 10.6;
provided, (1) on the date of such assignment, the Replacement Lender shall pay
to Terminated Lender an amount equal to the sum of (A) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans of the
Terminated Lender and (B) an amount equal to all accrued, but theretofore unpaid
fees owing to such Terminated Lender pursuant to Section 2.8; (2) on the date of
such assignment, Borrower shall pay any amounts payable to such Terminated
Lender pursuant to Section 2.15(c), 2.16 or 2.17 or otherwise as if it were a
prepayment; and (3) in the event such Terminated Lender is a Non-Consenting
Lender, each Replacement Lender shall consent, at the time of such assignment,
to each matter in respect of which such Terminated Lender was a Non-Consenting
Lender. Upon the prepayment of all amounts owing to any Terminated Lender, such
Terminated Lender shall no longer constitute a "Lender" for purposes hereof;
provided, any rights of such Terminated Lender to indemnification hereunder
shall survive as to such Terminated Lender.
SECTION 3. CONDITIONS PRECEDENT
3.1. CLOSING DATE. The obligation of any Lender to make a Credit
Extension on the Closing Date is subject to the satisfaction, or waiver in
accordance with Section 10.5, of the following conditions on or before the
Closing Date:
(a) Credit Documents. Administrative Agent shall have received
sufficient copies of each Credit Document originally executed and delivered by
each applicable Credit Party for each Lender.
(b) Organizational Documents; Incumbency. Administrative Agent
shall have received:
(i) sufficient copies of each Organizational
Document executed and delivered by each Credit Party, as applicable,
and, to the extent applicable, certified as of a recent date by the
appropriate governmental official, for each Lender, each dated the
Closing Date or a recent date prior thereto;
(ii) signature and incumbency certificates
of the officers of such Person executing the Credit Documents to which
it is a party;
(iii) resolutions of the Board of Directors
or similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this Agreement
and the other Credit Documents and the Related Agreements to which it
is a party or by which it or its assets may be bound as of the Closing
Date, certified as of the Closing Date by its secretary or an assistant
secretary as being in full force and effect without modification or
amendment;
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(iv) a good standing certificate from the
applicable Governmental Authority of each Credit Party's jurisdiction
of incorporation, organization or formation and in each jurisdiction in
which it is qualified as a foreign corporation or other entity to do
business (each of which shall be listed on Schedule 4.1), each dated a
recent date prior to the Closing Date; and
(v) such other documents as Administrative
Agent may reasonably request.
(c) Organizational and Capital Structure. The organizational
structure and capital structure of Holdings and its Subsidiaries, both before
and after giving effect to Transactions, shall be as set forth on Schedule 4.1.
(d) Capitalization of Holdings and Borrower. (i) On the
Closing Date, Sponsor shall have made the contribution of Sponsor Equity and
Borrower shall have received the proceeds thereof; and (ii) On the Closing Date,
Borrower shall have issued $160,000,000 of Senior Subordinated Notes which,
together with Sponsor Equity and the proceeds of the Loans, shall be sufficient
to consummate the Acquisition and the transactions contemplated in connection
therewith and to pay all Transaction Costs.
(e) Consummation of Transactions.
(i) (1) All conditions set forth in the
Acquisition Documents and documents related to the Senior Subordinated
Notes shall have been satisfied or the fulfillment of any such
conditions shall have been waived with the consent of Administrative
Agent (which consent shall not be unreasonably withheld) and (2) the
Transactions shall have become effective in accordance with the terms
of the Related Agreements.
(ii) Administrative Agent shall have
received a fully executed or conformed copy of each Related Agreement
and any documents executed in connection therewith. Each Related
Agreement shall be in full force and effect, shall include terms and
provisions reasonably satisfactory to Administrative Agent and no
provision thereof shall have been modified or waived in any respect
reasonably determined by Administrative Agent to be material, in each
case without the consent of Administrative Agent.
(f) Existing Indebtedness; Debt Tender. On the Closing Date,
Holdings and its Subsidiaries shall have:
(i) repaid in full all outstanding Existing
Indebtedness;
(ii) terminated any commitments to lend or
make other extensions of credit thereunder;
(iii) delivered to Administrative Agent all
documents or instruments necessary to release all Liens securing
Existing Indebtedness or other
49
obligations of Holdings and its Subsidiaries thereunder being repaid on
the Closing Date; and
(iv) made arrangements reasonably
satisfactory to Administrative Agent with respect to the cancellation
of any letters of credit outstanding thereunder or the issuance of
Letters of Credit to support the obligations of Holdings and its
Subsidiaries with respect thereto.
Administrative Agent shall be reasonably satisfied that an irrevocable notice of
redemption for all outstanding SAC Notes has been deposited with the trustee and
sufficient funds have been irrevocably deposited to fund such redemption and the
Debt Tender shall have occurred, each on terms reasonably acceptable to
Administrative Agent.
(g) Transaction Costs. On or prior to the Closing Date,
Borrower shall have delivered to Administrative Agent Borrower's reasonable best
estimate of the Transaction Costs (other than fees payable to any Agent).
(h) Governmental Authorizations and Consents. Each Credit
Party shall have obtained all Governmental Authorizations and all consents of
other Persons, in each case that are reasonably necessary in connection with the
transactions contemplated by the Credit Documents and the Related Agreements and
each of the foregoing shall be in full force and effect and in form and
substance reasonably satisfactory to Administrative Agent. All applicable
waiting periods shall have expired without any action being taken or threatened
by any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the transactions contemplated by the Credit Documents or
the Related Agreements or the financing thereof and no action, request for stay,
petition for review or rehearing, reconsideration, or appeal with respect to any
of the foregoing shall be pending, and the time for any applicable agency to
take action to set aside its consent on its own motion shall have expired.
(i) Real Estate Assets. In order to create in favor of
Collateral Agent, for the benefit of Term Secured Parties, a valid and, subject
to any filing and/or recording referred to herein, perfected First Priority
security interest in certain Real Estate Assets, Borrower and each applicable
Guarantor shall have used their commercially reasonable efforts to obtain and
deliver to Collateral Agent, in the case of each Leasehold Property listed on
Schedule 3.1(i), (I) a Landlord Consent and Estoppel and (II) evidence that such
Leasehold Property is a Recorded Leasehold Interest, and Collateral Agent shall
have received from Borrower and each applicable Guarantor:
(i) fully executed and notarized Mortgages,
in proper form for recording in all appropriate places in all
applicable jurisdictions, encumbering each Real Estate Asset listed in
Schedule 3.1(i) (each, a "CLOSING DATE MORTGAGED PROPERTY");
(ii) an opinion of counsel (which counsel
shall be reasonably satisfactory to Collateral Agent) in each state in
which a Closing Date Mortgaged Property is located addressed to the
Agents and the Lenders and dated as of the Closing Date with respect to
the enforceability of the form(s) of Mortgages to be recorded in such
state and such other matters as Collateral Agent
50
may reasonably request, in each case in form and substance reasonably
satisfactory to Collateral Agent;
(iii) (A) ALTA mortgagee title insurance
policies or unconditional commitments therefor issued by one or more
title companies reasonably satisfactory to Collateral Agent with
respect to each Closing Date Mortgaged Property (each, a "TITLE
POLICY"), in amounts not less than the fair market value of each
Closing Date Mortgaged Property, together with a title report issued by
a title company with respect thereto, dated not more than thirty days
prior to the Closing Date and copies of all recorded documents listed
as exceptions to title or otherwise referred to therein, each in form
and substance reasonably satisfactory to Collateral Agent and (B)
evidence reasonably satisfactory to Collateral Agent that such Credit
Party has paid to the title company or to the appropriate governmental
authorities all expenses and premiums of the title company and all
other sums required in connection with the issuance of each Title
Policy and all recording and stamp taxes (including mortgage recording
and intangible taxes) payable in connection with recording the
Mortgages for each Closing Date Mortgaged Property in the appropriate
real estate records; and
(iv) evidence of flood insurance with
respect to each Flood Hazard Property that is located in a community
that participates in the National Flood Insurance Program, in each case
in compliance with any applicable regulations of the Board of Governors
of the Federal Reserve System, in form and substance reasonably
satisfactory to Collateral Agent.
(j) Personal Property Collateral. In order to create in favor
of Collateral Agent, for the benefit of the Term Secured Parties, a valid,
perfected First Priority security interest in the personal property Fixed
Collateral, and a valid, perfected Second Priority security interest in the
personal property Liquid Collateral, Collateral Agent shall have received:
(i) evidence reasonably satisfactory to
Collateral Agent of the compliance by each Credit Party with their
obligations under the Term Pledge and Security Agreement and the other
Collateral Documents (including, without limitation, their obligations
to execute and deliver UCC financing statements, originals of
securities, instruments and chattel paper and any agreements perfecting
the security interest in deposit and/or securities accounts as provided
therein);
(ii) a completed Collateral Questionnaire
dated the Closing Date and executed by an Authorized Officer of each
Credit Party, together with all attachments contemplated thereby,
including (A) the results of a recent search, by a Person satisfactory
to Collateral Agent, of all effective UCC financing statements (or
equivalent filings) made with respect to any personal or mixed property
of any Credit Party in the jurisdictions specified in the Collateral
Questionnaire, together with copies of all such filings disclosed by
such search, and (B) UCC termination statements (or similar documents)
duly authorized for
51
filing by all applicable Persons for filing in all applicable
jurisdictions as may be necessary to terminate any effective UCC
financing statements (or equivalent filings) disclosed in such search
(other than any such financing statements in respect of Permitted
Liens);
(iii) opinions of counsel (which counsel
shall be reasonably satisfactory to Collateral Agent) with respect to
the creation and perfection of the security interests in favor of
Collateral Agent in such Collateral and such other matters governed by
the laws of each jurisdiction in which any Credit Party or any personal
property Collateral is located and the laws of any other applicable
jurisdictions addressed to the Agents and the Lenders and dated as of
the Closing Date, in each case as Collateral Agent may reasonably
request, in form and substance reasonably satisfactory to Collateral
Agent; and
(iv) evidence that each Credit Party shall
have taken or caused to be taken any other action, executed and
delivered or caused to be executed and delivered any other agreement,
document and instrument (including without limitation, (i) a Landlord
Personal Property Collateral Access Agreement executed by the landlord
of any Leasehold Property and by the applicable Credit Party and (ii)
any intercompany notes evidencing Indebtedness permitted to be incurred
pursuant to Section 6.1(b)) and made or caused to be made any other
filing and recording (other than as set forth herein) reasonably
required by Collateral Agent.
(k) Environmental Reports. Administrative Agent shall have
received reports and other information, in form, scope and substance reasonably
satisfactory to Administrative Agent, regarding environmental matters relating
to the Facilities, which reports shall include a Phase I Report for each of the
Facilities specified by Administrative Agent.
(l) Historical Financial Statements; Projections. The Lenders
shall have received from Borrower (i) the Historical Financial Statements, (ii)
the Projections and (iii) pro forma consolidated balance sheet of Borrower and
its Subsidiaries as at the Closing Date, reflecting the consummation of the
Transaction, which pro forma financial statements shall be in form and substance
reasonably satisfactory to Administrative Agent. Such financial statements shall
show pro forma Consolidated Adjusted EBITDA of Borrower after giving effect to
the Transactions (calculated in accordance with Regulation S-X and including
only those adjustment that the Sole Lead Arranger reasonably agrees are
appropriate) (i) for the twelve month period ended April 30, 2004 of not less
than $50.7 million and (ii) for any subsequent twelve month period for which
financial statements are available of not less than $50.0 million.
(m) Evidence of Insurance. Collateral Agent shall have
received a certificate from Borrower's insurance broker or other evidence
reasonably satisfactory to it that all insurance required to be maintained
pursuant to Section 5.5 is in full force and effect, together with endorsements
naming the Collateral Agent, for the benefit of the Term Secured Parties, as
additional insured and loss payee thereunder to the extent required under
Section 5.5.
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(n) Opinions of Counsel to Credit Parties. Lenders shall have
received originally executed copies of the favorable written opinions of Ropes &
Xxxx LLP, counsel for Credit Parties, addressed to the Agents and the Revolving
Secured Parties, as to such other matters as Administrative Agent and Collateral
Agent may reasonably request, dated as of the Closing Date and otherwise in form
and substance reasonably satisfactory to Administrative Agent (and each Credit
Party hereby instructs such counsel to deliver such opinions to Agents and
Secured Parties).
(o) Fees. Borrower shall have paid to Agents the fees payable
on the Closing Date referred to in Section 2.9.
(p) Solvency Certificate. On the Closing Date, Administrative
Agent shall have received a Solvency Certificate from the chief financial
officer of Borrower, dated the Closing Date and addressed to Administrative
Agent and Lenders, in form, scope and substance reasonably satisfactory to
Administrative Agent, with appropriate attachments and demonstrating that after
giving effect to the consummation of Transactions, Borrower and its Subsidiaries
are and will be Solvent.
(q) Closing Date Certificate. Holdings and Borrower shall have
delivered to Administrative Agent an originally executed Closing Date
Certificate, together with all attachments thereto.
(r) Credit Rating. The credit facilities provided for under
this Agreement shall have been assigned a credit rating by either S&P and
Xxxxx'x in each case reasonably satisfactory to the Agents.
(s) Revolving Credit Agreement. On or before the Closing Date,
Borrower shall have delivered to Syndication Agent and Administrative Agent
complete, correct and conformed copies of the Revolving Credit Agreement.
(t) No Litigation. There shall not exist any action, suit,
investigation, litigation or proceeding or other legal or regulatory
developments, pending or threatened in any court or before any arbitrator or
Governmental Authority that, in the reasonable opinion of Administrative Agent,
singly or in the aggregate, materially impairs the Transactions, the financing
thereof or any of the other transactions contemplated by the Credit Documents or
the Related Agreements, or that could have a Material Adverse Effect.
(u) Chief Financial Officer Certificate. Holdings and Borrower
shall have delivered to Administrative Agent and Lenders an originally executed
chief financial officer certificate certifying that the pro forma Leverage Ratio
as at the Closing Date and for the most recent twelve-month period for which
financial statements are available of Borrower and its Subsidiaries for the
twelve-month period then ended (which pro forma ratio shall be calculated
reflecting the Transactions on a pro forma basis and shall be acceptable to the
Lenders) shall not be greater than 4.5 to 1.0.
(v) Completion of Proceedings. All partnership, corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent and its
53
counsel shall be reasonably satisfactory in form and substance to
Administrative Agent and such counsel, and Administrative Agent and such counsel
shall have received all such counterpart originals or certified copies of such
documents as Administrative Agent may reasonably request.
(w) Patriot Act. Administrative Agent shall have received all
documentation and other information required by bank regulatory authorities
under applicable "know-your-customer" and anti-money laundering rules and
regulations, including the USA Patriot Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001).
Each Lender, by delivering its signature page to this Agreement, shall be deemed
to have acknowledged receipt of, and consented to and approved, each Credit
Document and each other document required to be approved by any Agent, Requisite
Lenders or Lenders, as applicable on the Closing Date.
3.2. FURTHER CONDITIONS TO ALL TERM LOANS.
(a) Conditions Precedent. The obligation of each Lender to
make any Loan on the Closing Date, are subject to the satisfaction, or waiver in
accordance with Section 10.5, of the following conditions precedent:
(i) Administrative Agent shall have received
a fully executed and delivered Funding Notice;
(ii) the representations and warranties
contained herein and in the other Credit Documents shall be true and
correct in all material respects on and as of the Closing Date; and
(iii) no event shall have occurred and be
continuing or would result from the consummation of the Credit
Extension that would constitute an Event of Default or a Default.
Any Agent or Requisite Lenders shall be entitled, but not obligated to, request
and receive, prior to the making of the Credit Extension, additional information
reasonably satisfactory to the requesting party confirming the satisfaction of
any of the foregoing if, in the good faith judgment of such Agent or Requisite
Lenders such request is warranted under the circumstances.
(b) Notices. Any Notice shall be executed by an Authorized
Officer in a writing delivered to Administrative Agent. In lieu of delivering a
Notice, Borrower may give Administrative Agent telephonic notice by the required
time of any proposed borrowing or conversion/continuation, as the case may be;
provided each such notice shall be promptly confirmed in writing by delivery of
the applicable Notice to Administrative Agent on or before the applicable date
of borrowing or continuation/conversion. Neither Administrative Agent nor any
Lender shall incur any liability to Borrower in acting upon any telephonic
notice referred to above that Administrative Agent believes in good faith to
have been given by a duly authorized officer or other person authorized on
behalf of Borrower or for otherwise acting in good faith.
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SECTION 4. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make
each Credit Extension to be made thereby, each Credit Party represents and
warrants to each Lender, on the Closing Date, that the following statements are
true and correct (it being understood and agreed that the representations and
warranties made on the Closing Date are deemed to be made concurrently with the
consummation of the Transactions contemplated hereby):
4.1. ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION. Each
of Holdings and its Subsidiaries:
(a) is duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization as identified in Schedule 4.1;
(b) has all requisite power and authority to own and operate its
properties, to carry on its business as now conducted and as proposed to be
conducted, to enter into the Credit Documents to which it is a party and to
carry out the transactions contemplated thereby; and
(c) is qualified to do business and in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its business and operations, except in jurisdictions where the failure to be so
qualified or in good standing has not had, and could not be reasonably expected
to have, a Material Adverse Effect.
4.2. CAPITAL STOCK AND OWNERSHIP. The Capital Stock of each of Holdings
and its Subsidiaries has been duly authorized and validly issued and is fully
paid and non-assessable. Except as set forth on Schedule 4.2, as of the date
hereof, there is no existing option, warrant, call, right, commitment or other
agreement to which Holdings or any of its Subsidiaries is a party requiring, and
there is no membership interest or other Capital Stock of Holdings or any of its
Subsidiaries outstanding which upon conversion or exchange would require, the
issuance by Holdings or any of its Subsidiaries of any additional membership
interests or other Capital Stock of Holdings or any of its Subsidiaries or other
Securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase, a membership interest or other Capital Stock of
Holdings or any of its Subsidiaries. Schedule 4.2 correctly sets forth the
ownership interest of Holdings and each of its Subsidiaries in their respective
Subsidiaries as of the Closing Date both before and after giving effect to the
Transactions.
4.3. DUE AUTHORIZATION. The execution, delivery and performance of the
Credit Documents have been duly authorized by all necessary action on the part
of each Credit Party that is a party thereto.
4.4. NO CONFLICT. The execution, delivery and performance by Credit
Parties of the Credit Documents to which they are parties and the consummation
of the transactions contemplated by the Credit Documents do not and will not:
(a) violate any provision of any law or any governmental rule or
regulation applicable to Holdings or any of its Subsidiaries, any of the
Organizational Documents of Holdings or any of its Subsidiaries, or any order,
judgment or decree of any court or other agency of government binding on
Holdings or any of its Subsidiaries;
55
(b) conflict with, result in a breach of or constitute (with due notice
or lapse of time or both) a default under any Contractual Obligation of Holdings
or any of its Subsidiaries;
(c) result in or require the creation or imposition of any Lien upon
any of the properties or assets of Holdings or any of its Subsidiaries (other
than any Liens created under any of the Credit Documents in favor of Collateral
Agent, on behalf of Secured Parties); or
(d) require any approval of stockholders, members or partners or any
approval or consent of any Person under any Contractual Obligation of Holdings
or any of its Subsidiaries, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders.
4.5. GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Credit Parties of the Credit Documents to which they are parties and the
consummation of the transactions contemplated by the Credit Documents do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by, any Governmental Authority except as otherwise set
forth in the Stock Purchase Agreement, and except for filings and recordings
with respect to the Collateral to be made, or otherwise delivered to Collateral
Agent for filing and/or recordation, as of the Closing Date.
4.6. BINDING OBLIGATION. Each Credit Document has been duly executed
and delivered by each Credit Party that is a party thereto and is the legally
valid and binding obligation of such Credit Party, enforceable against such
Credit Party in accordance with its respective terms, except as may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by equitable principles relating
to enforceability.
4.7. HISTORICAL FINANCIAL STATEMENTS. The Historical Financial
Statements were prepared in conformity with GAAP and fairly present, in all
material respects, the financial position, on a consolidated basis, of the
Persons described in such financial statements as at the respective dates
thereof and the results of operations and cash flows, on a consolidated basis,
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to changes resulting
from audit and normal year-end adjustments and in the case of interim
statements, to the absence of footnotes. As of the Closing Date, neither
Holdings nor any of its Subsidiaries has any contingent liability or liability
for taxes, long-term lease or unusual forward or long-term commitment that is
not reflected in the Historical Financial Statements or the notes thereto and
which in any such case is material in relation to the business, operations,
properties, assets, condition (financial or otherwise) or prospects of Holdings
and any of its Subsidiaries taken as a whole.
4.8. PROJECTIONS. On and as of the Closing Date, the Projections of
Holdings and its Subsidiaries for the period Fiscal Year 2004 through and
including Fiscal Year 2008 (the "PROJECTIONS") are based on good faith estimates
and assumptions made by the management of Holdings; provided, that the
Projections are not to be viewed as facts and that actual results during the
period or periods covered by the Projections may differ from such Projections
and that the differences may be material; provided, further, as of the Closing
Date, management of Holdings believed that the Projections were reasonable.
56
4.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 2003, no event,
circumstance or change has occurred that has caused or evidences, either in any
case or in the aggregate, a Material Adverse Effect.
4.10. NO RESTRICTED JUNIOR PAYMENTS. Since December 31, 2003, neither
Holdings nor any of its Subsidiaries has directly or indirectly declared,
ordered, paid or made, or set apart any sum or property for, any Restricted
Junior Payment or agreed to do so except as permitted pursuant to Section 6.5.
4.11. ADVERSE PROCEEDINGS, ETC. There are no Adverse Proceedings,
individually or in the aggregate, that could reasonably be expected to have a
Material Adverse Effect. Neither Holdings nor any of its Subsidiaries (a) is in
violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, or (b) is subject to or in default with respect to any
final judgments, writs, injunctions, decrees, rules or regulations of any court
or any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
4.12. PAYMENT OF TAXES. Except as otherwise permitted under Section
5.3, all tax returns and reports of Holdings and its Subsidiaries required to be
filed by any of them have been timely filed, and all taxes shown on such tax
returns to be due and payable and all assessments, fees and other governmental
charges upon Holdings and its Subsidiaries and upon their respective properties,
assets, income, businesses and franchises which are due and payable have been
paid when due and payable. Holdings knows of no proposed tax assessment against
Holdings or any of its Subsidiaries which is not being contested by Holdings or
such Subsidiary in good faith and by appropriate proceedings; provided, such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
4.13. PROPERTIES.
(a) Title. Each of Holdings and its Subsidiaries has, subject
to Permitted Liens, (i) good, sufficient and legal title to (in the case of fee
interests in real property), (ii) valid leasehold interests in (in the case of
leasehold interests in real or personal property), and (iii) good title to (in
the case of all other personal property), all of their respective properties and
assets reflected in their respective Historical Financial Statements referred to
in Section 4.7 and in the most recent financial statements delivered pursuant to
Section 5.1, in each case except for assets disposed of since the date of such
financial statements in the ordinary course of business or as otherwise
permitted under Section 6.9. Except as permitted by this Agreement, all such
properties and assets are free and clear of Liens.
(b) Real Estate. As of the Closing Date, Schedule 4.13
contains a true, accurate and complete list of (i) all Real Estate Assets, and
(ii) all leases, subleases or assignments of leases (together with all
amendments, modifications, supplements, renewals or extensions of any thereof)
affecting each Real Estate Asset of any Credit Party, regardless of whether such
Credit Party is the landlord or tenant (whether directly or as an assignee or
successor in interest) under
57
such lease, sublease or assignment. Each agreement listed in clause (ii) of the
immediately preceding sentence is in full force and effect and Holdings does not
have knowledge of any default that has occurred and is continuing thereunder,
and each such agreement constitutes the legally valid and binding obligation of
each applicable Credit Party, enforceable against such Credit Party in
accordance with its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles.
4.14. ENVIRONMENTAL MATTERS. Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect or as otherwise set
forth on Schedule 4.14:
(a) neither Holdings nor any of its Subsidiaries nor any of
their respective past or present Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with any
Person relating to any Environmental Law, any Environmental Claim, or any
Hazardous Materials Activity;
(b) neither Holdings nor any of its Subsidiaries (i) has, or
has received or is aware of, any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental matters
or applicable Environmental Laws (including Governmental Authorizations required
by Environmental Laws) with regard to any past or present Facilities or
operations, (ii) has knowledge or reason to believe that any such notice will be
received or is being threatened, (iii) is or has been reason within the last
five years in non-compliance with Environmental Laws, including any and all
Governmental Authorizations required by Environmental Laws, or (iv) has assumed
any liability of any other Person under applicable Environmental Laws;
(c) neither Holdings nor any of its Subsidiaries has either
been notified in writing by a Governmental Agency or by any other Person that it
may be a potentially responsible party or received any letter or request for
information under Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 9604) or any comparable state
law;
(d) there are and, to each of Holdings' and its Subsidiaries'
knowledge, have been, no facts, circumstances, conditions, occurrences, or
Hazardous Materials Activities which could reasonably be expected to (i) form
the basis of an Environmental Claim against Holdings or any of its Subsidiaries;
(ii) cause any Facility to become subject to any Lien, restriction on ownership,
occupancy, use or transferability under any Environmental Law; or (iii) require
any Facility to be upgraded or modified in order to remain in compliance with
current and reasonably foreseeable future requirements under Environmental Law;
(e) neither Holdings nor any of its Subsidiaries nor, to any
Credit Party's knowledge, any predecessor of Holdings or any of its
Subsidiaries, has filed any notice under any Environmental Law indicating past
or present treatment of Hazardous Materials at any Facility, and none of
Holdings' or any of its Subsidiaries' operations involves the generation,
transportation, treatment, storage or disposal of hazardous waste, as defined
under 40 C.F.R. Parts 260-270 or any state equivalent ;
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(f) no event or condition has occurred or is occurring with
respect to Holdings or any of its Subsidiaries relating to any Release of
Hazardous Materials, or any Hazardous Materials Activity.
4.15. NO DEFAULTS. Neither Holdings nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists which, with the giving of notice or the lapse of time or both,
could constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, could not reasonably be expected
to have a Material Adverse Effect.
4.16. MATERIAL CONTRACTS. Schedule 4.16 contains a true, correct and
complete list of all the Material Contracts in effect on the Closing Date, and
except as described thereon, all such Material Contracts are in full force and
effect and no defaults currently exist thereunder.
4.17. GOVERNMENTAL REGULATION. Neither Holdings nor any of its
Subsidiaries is subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness or which may otherwise render all or any portion
of the Obligations unenforceable. Neither Holdings nor any of its Subsidiaries
is a "registered investment company" or a company "controlled" by a "registered
investment company" or a "principal underwriter" of a "registered investment
company" as such terms are defined in the Investment Company Act of 1940.
4.18. MARGIN STOCK. Neither Holdings nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin Stock. No
part of the proceeds of the Loans made to such Credit Party will be used to
purchase or carry any such margin stock or to extend credit to others for the
purpose of purchasing or carrying any such margin stock or for any purpose that
violates, or is inconsistent with, the provisions of Regulation T, U or X of
said Board of Governors.
4.19. EMPLOYEE MATTERS. Neither Holdings nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect. There is (a) no unfair labor practice complaint pending
against Holdings or any of its Subsidiaries, or to the knowledge of Holdings and
Borrower, threatened against any of them before the National Labor Relations
Board and no grievance or arbitration proceeding arising out of or under any
collective bargaining agreement that is so pending against Holdings or any of
its Subsidiaries or to the knowledge of Holdings and Borrower, threatened
against any of them, (b) no strike or work stoppage in existence or to the
knowledge of Holdings threatened involving Holdings or any of its Subsidiaries
that could reasonably be expected to have a Material Adverse Effect, and (c) to
the knowledge of Holdings and Borrower, no union representation question
existing with respect to the employees of Holdings or any of its Subsidiaries
and, to the knowledge of Holdings and Borrower, no union organization activity
that is taking place, except (with respect to any matter specified in clause
(a), (b) or (c) above, either individually or in the aggregate) such as is not
reasonably likely to have a Material Adverse Effect.
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4.20. EMPLOYEE BENEFIT PLANS. Holdings and each of its Subsidiaries are
in compliance with all applicable provisions and requirements of ERISA and the
Internal Revenue Code and the regulations and published interpretations
thereunder with respect to each Employee Benefit Plan, and have performed all
their obligations under each Employee Benefit Plan, except as would not
reasonably be expected to have a Material Adverse Effect. Each Employee Benefit
Plan which is intended to qualify under Section 401(a) of the Internal Revenue
Code has received a favorable determination letter from the Internal Revenue
Service indicating that such Employee Benefit Plan is so qualified and nothing
has occurred subsequent to the issuance of such determination letter which would
reasonably be expected to cause such Employee Benefit Plan to lose its qualified
status. No liability to the PBGC (other than required premium payments), the
Internal Revenue Service, any Employee Benefit Plan (other than the payment of
benefits in the ordinary course) or any trust established under Title IV of
ERISA has been or is expected to be incurred by Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates, except as would not
reasonably be expected to have a Material Adverse Effect. No ERISA Event has
occurred or is reasonably expected to occur, except as would not reasonably be
expected to have a Material Adverse Effect. Except to the extent required under
Section 4980B of the Internal Revenue Code or similar state laws or as set forth
on Schedule 4.20, no Employee Benefit Plan provides health or welfare benefits
(through the purchase of insurance or otherwise) for any retired or former
employee of Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates. Holdings, each of its Subsidiaries and each of their ERISA
Affiliates have complied in all material respects with the requirements of
Section 515 of ERISA with respect to each Multiemployer Plan and are not in
material "default" (as defined in Section 4219(c)(5) of ERISA) with respect to
payments to a Multiemployer Plan.
4.21. CERTAIN FEES. No broker's or finder's fee or commission will be
payable with respect hereto or any of the transactions contemplated hereby.
4.22. SOLVENCY. Each Credit Party is and, upon the incurrence of any
Obligation by such Credit Party on any date on which this representation and
warranty is made, will be, Solvent.
4.23. RELATED AGREEMENTS.
(a) Delivery. Holdings and Borrower have delivered to
Administrative Agent complete and correct copies of (i) each Related Agreement
and of all exhibits and schedules thereto as of the date hereof and (ii) copies
of any material amendment, restatement, supplement or other modification to or
waiver of each Related Agreement entered into after the date hereof.
(b) Representations and Warranties. Except to the extent
otherwise expressly set forth herein or in the schedules hereto, and subject to
the qualifications set forth therein, each of the representations and warranties
given by any Credit Party in any Related Agreement is true and correct in all
material respects as of the Closing Date (or as of any earlier date to which
such representation and warranty specifically relates). Notwithstanding anything
in the Related Agreement to the contrary, the representations and warranties of
each Credit Party set forth in this Section 4.23 shall, solely for purposes
hereof, survive the Closing Date for the benefit of Lenders.
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(c) Governmental Approvals. All Governmental Authorizations
and all other authorizations, approvals and consents of any other Person
required by the Related Agreements or to consummate the Transactions have been
obtained and are in full force and effect.
(d) Conditions Precedent. On the Closing Date, (i) all of the
conditions to effecting or consummating the Transactions set forth in the
Related Agreements have been duly satisfied or, with the consent of
Administrative Agent (which may not be unreasonably withheld) waived, and (ii)
the Transactions have been consummated in accordance with the Related Agreements
and all applicable laws.
4.24. COMPLIANCE WITH STATUTES, ETC. Each of Holdings and its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all Governmental
Authorities, in respect of the conduct of its business and the ownership of its
property (including compliance with all applicable Environmental Laws with
respect to any Real Estate Asset or governing its business and the requirements
of any Governmental Authorizations issued under such Environmental Laws with
respect to any such Real Estate Asset or the operations of Holdings or any of
its Subsidiaries), except such non-compliance that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
4.25. DISCLOSURE. No representation or warranty of any Credit Party
contained in any Credit Document or in any other documents, certificates or
written statements furnished to Lenders by or on behalf of Holdings or any of
its Subsidiaries for use in connection with the transactions contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact (known to Holdings or Borrower, in the case of any document not furnished
by either of them) necessary in order to make the statements contained herein or
therein not misleading in light of the circumstances in which the same were
made. Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Holdings or Borrower to be reasonable at the time made, it being recognized by
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may differ from the projected results. There are no facts known (or
which should upon the reasonable exercise of diligence be known) to Holdings or
Borrower (other than matters of a general economic nature or affecting
Borrower's industry generally) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and that have not
been disclosed herein or in such other documents, certificates and statements
furnished to Lenders for use in connection with the transactions contemplated
hereby.
4.26. SUBORDINATION; DESIGNATION OF THE CREDIT DOCUMENTS AS "DESIGNATED
SENIOR INDEBTEDNESS"; ETC.
(a) (i) The subordination provisions contained in the
documents governing the Senior Subordinated Notes, the Refinancing Notes and any
guarantees of such Senior Subordinated Notes and Refinancing Notes are
enforceable against Holdings, Borrower and any of its Subsidiaries party thereto
and the holders of such Indebtedness, and (ii) all Obligations of the Credit
Parties (to the extent they are obligors with respect to the Senior Subordinated
Notes, the Refinancing Notes or any guarantees of such Senior Subordinated Notes
and Refinancing
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Notes) hereunder and in the other Credit Documents are covered by and included
in the definitions of "Designated Senior Debt" and "Senior Debt" (or any
comparable definitions) included in the respective subordination provisions
contained in the documentation governing the Senior Subordinated Notes, the
Refinancing Notes and any guarantees of such Senior Subordinated Notes and
Refinancing Notes. In addition, Borrower hereby designates the Obligations under
this Agreement as "Designated Senior Debt" for the purposes of the definition of
"Designated Senior Debt" (or any comparable definitions) contained in the Senior
Subordinated Notes Indenture, the Refinancing Notes and any guarantees of such
Senior Subordinated Notes and Refinancing Notes.
(b) All incurrences of Loans as permitted under this Agreement
are, and when incurred or issued will be, permitted under (and shall give rise
to no breach or violation of any of) the SAC Notes, the Senior Subordinated
Notes and the Refinancing Notes.
SECTION 5. AFFIRMATIVE COVENANTS
Each Credit Party covenants and agrees that so long as any Commitment
is in effect and until payment in full of all Obligations, each Credit Party
shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 5.
5.1. FINANCIAL STATEMENTS AND OTHER REPORTS. Borrower will deliver to
Administrative Agent (and Administrative Agent shall promptly deliver to each
Lender):
(a) Monthly Reports. As soon as available, and in any event
within thirty (30) days after the end of each month ending after the Closing
Date, the consolidated balance sheet of Borrower and its Subsidiaries as at the
end of such month and the related consolidated statements of income and cash
flows of Borrower and its Subsidiaries for such month and for the period from
the beginning of the then current Fiscal Year to the end of such month, setting
forth in each case in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and the corresponding figures
from the Financial Plan for the current Fiscal Year, to the extent prepared on a
monthly basis, all in reasonable detail (it being understood that such monthly
statements are not, for this purpose, required to be prepared in accordance with
GAAP);
(b) Quarterly Financial Statements. As soon as available, and
in any event within forty-five days after the end of each of the first three
Fiscal Quarters of each Fiscal Year, the consolidated balance sheets of Borrower
and its Subsidiaries as at the end of such Fiscal Quarter and the related
consolidated statements of income, stockholders' equity and cash flows of
Borrower and its Subsidiaries for such Fiscal Quarter and for the period from
the beginning of the then current Fiscal Year to the end of such Fiscal Quarter,
setting forth in each case in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and the corresponding figures
from the Financial Plan for the current Fiscal Year, all in reasonable detail,
together with a Financial Officer Certification and a Narrative Report with
respect thereto;
(c) Annual Financial Statements. As soon as available, and in
any event within one hundred five (105) days after the end of each Fiscal Year,
(i) the consolidated balance sheets of Borrower and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated
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statements of income, stockholders' equity and cash flows of Borrower and its
Subsidiaries for such Fiscal Year, setting forth in each case in comparative
form the corresponding figures for the previous Fiscal Year and the
corresponding figures from the Financial Plan for the Fiscal Year covered by
such financial statements, in reasonable detail, together with a Financial
Officer Certification and a Narrative Report with respect thereto; and (ii) with
respect to such consolidated financial statements a report thereon of Deloitte &
Touche LLP or other independent certified public accountants of recognized
national standing selected by Borrower, and reasonably satisfactory to
Administrative Agent (which report shall be unqualified as to going concern and
scope of audit, and shall state that such consolidated financial statements
fairly present, in all material respects, the consolidated financial position of
Borrower and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity with
GAAP applied on a basis consistent with prior years (except as otherwise
disclosed in such financial statements) and that the examination by such
accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards) together with a
written statement by such independent certified public accountants stating (1)
that their audit examination has included a review of the terms of the Credit
Documents and (2) that nothing has come to their attention that causes them to
believe that the information contained in any Compliance Certificate is not
correct or that the matters set forth in such Compliance Certificate are not
stated in accordance with the terms hereof;
(d) Compliance Certificate. Together with each delivery of
financial statements of Holdings and its Subsidiaries pursuant to Sections
5.1(b) and 5.1(c), a duly executed and completed Compliance Certificate;
(e) Statements of Reconciliation after Change in Accounting
Principles. If, as a result of any change in accounting principles and policies
from those used in the preparation of the Historical Financial Statements, the
consolidated financial statements of Holdings and its Subsidiaries delivered
pursuant to Section 5.1(b) or 5.1(c) will differ in any material respect from
the consolidated financial statements that would have been delivered pursuant to
such subdivisions had no such change in accounting principles and policies been
made, then, together with the first delivery of such financial statements after
such change, one or more statements of reconciliation for all such prior
financial statements in form and substance reasonably satisfactory to
Administrative Agent;
(f) Notice of Default. Promptly upon any officer of Holdings
or Borrower obtaining knowledge:
(i) of any condition or event that
constitutes a Default or an Event of Default or that notice has been
given to Holdings or Borrower with respect thereto;
(ii) that any Person has given any notice to
Holdings or any of its Subsidiaries or taken any other action with
respect to any event or condition set forth in Section 8.1(b);
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(iii) of the occurrence of any event or
change that has caused or evidences, either in any case or in the
aggregate, a Material Adverse Effect; or
(iv) that any Person has given any notice to
Holdings or any of its Subsidiaries or taken any other action with
respect to any condition or event that constitutes a default under any
lease of a Real Estate Asset subject to a Mortgage;
a certificate of its Authorized Officers specifying the nature and period of
existence of such condition, event or change, or specifying the notice given and
action taken by any such Person and the nature of such claimed Event of Default,
Default, default, event or condition, and what action Borrower has taken, is
taking and proposes to take with respect thereto;
(g) Notice of Litigation. Promptly upon any officer of
Holdings or Borrower obtaining knowledge of (i) the institution of, or
non-frivolous threat of, any Adverse Proceeding not previously disclosed in
writing by Borrower to Lenders, or (ii) any material development in any Adverse
Proceeding that, in the case of either (i) or (ii) if adversely determined,
could be reasonably expected to have a Material Adverse Effect, or seeks to
enjoin or otherwise prevent the consummation of, or to recover any damages or
obtain relief as a result of, the transactions contemplated hereby, written
notice thereof together with such other information as may be reasonably
available to Holdings or Borrower to enable Lenders and their counsel to
evaluate such matters;
(h) ERISA. (i) Promptly upon becoming aware of the occurrence
of or forthcoming occurrence of any ERISA Event, a written notice specifying the
nature thereof, what action Holdings or any of its Subsidiaries or any of their
then existing ERISA Affiliates has taken, is taking or proposes to take with
respect thereto and, when known, any action taken or threatened by the Internal
Revenue Service, the Department of Labor or the PBGC with respect thereto; and
(ii) with reasonable promptness, copies of (1) all notices received by Holdings
or any of its Subsidiaries or any of their then-existing ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (2) copies of such
other documents or governmental reports or filings relating to any Employee
Benefit Plan (including without limitation any Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by Holdings, any of
its Subsidiaries or any of their then-existing ERISA Affiliates with the
Internal Revenue Service with respect to each Pension Plan) as Administrative
Agent shall reasonably request;
(i) Financial Plan. As soon as practicable and in any event no
later than thirty days after the beginning of each Fiscal Year, a consolidated
plan and financial forecast for such Fiscal Year (a "FINANCIAL PLAN"), including
(i) a forecasted consolidated balance sheet and forecasted consolidated
statements of income and cash flows of Borrower and its Subsidiaries for each
such Fiscal Year, together with pro forma Compliance Certificates for each such
Fiscal Year and an explanation of the assumptions on which such forecasts are
based, and (ii) forecasted consolidated statements of income and cash flows of
Borrower and its Subsidiaries for each month of the first Fiscal Year included
in the Financial Plan;
(j) Insurance Report. As soon as practicable and in any event
by no later than five (5) Business Days after the annual renewal date, a summary
report in form and substance
64
reasonably satisfactory to Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by Holdings and its
Subsidiaries and all material insurance coverage planned to be maintained by
Holdings and its Subsidiaries in the immediately succeeding Fiscal Year;
(k) Notice of Change in Board of Directors. With reasonable
promptness, written notice of any change in the board of directors (or similar
governing body) of Holdings or Borrower;
(l) Notice Regarding Material Contracts. Promptly, and in any
event within ten Business Days (i) after any Material Contract of Holdings or
any of its Subsidiaries is terminated or amended in a manner that is materially
adverse to Holdings or such Subsidiary, as the case may be, or (ii) after any
new Material Contract is entered into, a written statement describing such
event, with copies of such material amendments or new contracts, delivered to
Administrative Agent (to the extent such delivery is permitted by the terms of
any such Material Contract, provided, no such prohibition on delivery shall be
effective if it were bargained for by Holdings or its applicable Subsidiary with
the intent of avoiding compliance with this Section 5.1(l)), and an explanation
of any actions being taken with respect thereto;
(m) Information Regarding Collateral. Borrower will furnish to
Collateral Agent prompt written notice of any change (i) in any Credit Party's
organizational name, (ii) in any Credit Party's identity or organizational
structure, (iii) in any Credit Party's jurisdiction of organization or (iv) in
any Credit Party's Federal Taxpayer Identification Number or organizational
identification number. Borrower agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for
Collateral Agent (for the benefit of the Term Secured Parties) to continue at
all times following such change to have a valid, legal and perfected First
Priority security interest in all the Fixed Collateral and a valid, legal and
perfected Second Priority security interest in all the Liquid Collateral; and
for the Collateral Agent at all times following such change to have such valid,
legal and perfected security interests as contemplated in the Collateral
Documents. Borrower also agrees promptly to notify Collateral Agent if any
material portion of the Collateral is damaged or destroyed;
(n) Annual Collateral Verification. Each year, at the time of
delivery of annual financial statements with respect to the preceding Fiscal
Year pursuant to Section 5.1(c), Borrower shall deliver to the Collateral Agent
an Officer's Certificate either confirming that there has been no change in such
information since the date of the Collateral Questionnaire delivered on the
Closing Date or the date of the then most recent certificate delivered pursuant
to this Section, as applicable, or identifying such changes; and
(o) Other Information. (A) Promptly upon their becoming
available, copies of:
(i) all financial statements, reports,
notices and proxy statements sent or made available generally by
Holdings to its security holders acting in such capacity or by any
Subsidiary of Holdings to its security holders other than Holdings or
another Subsidiary of Holdings;
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(ii) all regular and periodic reports and
all registration statements and prospectuses, if any, filed by Holdings
or any of its Subsidiaries with any securities exchange or with the
Securities and Exchange Commission or any governmental or private
regulatory authority; and
(iii) all press releases and other
statements made available generally by Holdings or any of its
Subsidiaries to the public concerning material developments in the
business of Holdings or any of its Subsidiaries, and
(B) such other information and data with respect to Holdings
or any of its Subsidiaries as from time to time may be reasonably requested by
Administrative Agent or any Lender.
Documents required to be delivered pursuant to Sections
5.1(a), 5.1(b), 5.1(c), 5.1(e) or 5.1(i) may be delivered electronically, and if
so delivered, shall be deemed to have been delivered on the date (i) on which
Borrower posts such documents or provides a link thereto on Borrower's website
on the Internet at the website address listed on Appendix B; or (ii) on which
such documents are posted on Borrower's behalf on IntraLinks/IntraAgency or
another relevant website, if any, to which each Lender and Administrative Agent
have access (whether a commercial, third-party website or whether sponsored by
Administrative Agent); provided, however, that: (x) Borrower shall deliver paper
copies of such documents to Administrative Agent until a written request to
cease delivering paper copies is given by Administrative Agent and (y) Borrower
shall notify (which may be by facsimile or electronic mail) Administrative Agent
of the posting of any such documents and provide to Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance Borrower shall be
required to provide paper copies of the Compliance Certificates to
Administrative Agent. Except for such Compliance Certificates, Administrative
Agent shall have no obligation to request the delivery or to maintain copies of
the documents referred to above, and in any event shall have no responsibility
to monitor compliance by Borrower with any such request for delivery.
5.2. EXISTENCE. Except as otherwise permitted under Section 6.9, each
Credit Party will, and will cause each of its Subsidiaries to, at all times
preserve and keep in full force and effect its existence and all rights,
franchises, licenses and Governmental Authorizations material to its business;
provided, no Credit Party or any of its Subsidiaries shall be required to
preserve any such right, franchise, licenses and Governmental Authorizations or
if the preservation thereof is no longer desirable in the conduct of the
business of such Person, and the loss thereof is not disadvantageous in any
material respect to such Person or to Lenders.
5.3. PAYMENT OF TAXES AND CLAIMS. Each Credit Party will, and will
cause each of its Subsidiaries to, pay all Taxes imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty or fine accrues thereon, and all claims (including
claims for labor, services, materials and supplies) for sums that have become
due and payable and that by law have or may become a Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto; provided, no such Tax or claim need be paid if it
is being contested in good faith by appropriate proceedings promptly instituted
and diligently conducted, so long as (a) adequate reserve or other appropriate
66
provision as shall be required in conformity with GAAP shall have been made
therefor, and (b) in the case of a Tax or claim which has or may become a Lien
against any of the Collateral, such contest proceedings conclusively operate to
stay the sale of any portion of the Collateral to satisfy such Tax or claim. No
Credit Party will, nor will it permit any of its Subsidiaries to, file or
consent to the filing of any consolidated income tax return with any Person
(other than Holdings or any of its Subsidiaries).
5.4. MAINTENANCE OF PROPERTIES. Each Credit Party will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or useful in the business of Holdings and its Subsidiaries and
from time to time will make or cause to be made all appropriate repairs,
renewals and replacements thereof.
5.5. INSURANCE. Borrower will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Holdings and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by Persons of
established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for such
Persons. Without limiting the generality of the foregoing, Holdings will
maintain or cause to be maintained (a) flood insurance with respect to each
Flood Hazard Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System, and (b)
replacement value casualty insurance on the Collateral under such policies of
insurance, with such insurance companies, in such amounts, with such
deductibles, and covering such risks as are at all times carried or maintained
under similar circumstances by Persons of established reputation engaged in
similar businesses. Each such policy of insurance shall (i) name Collateral
Agent, on behalf of the Term Secured Parties, as an additional insured
thereunder as its interests may appear and (ii) in the case of each casualty
insurance policy contain a loss payable clause or endorsement, reasonably
satisfactory in form and substance to Collateral Agent, that names Collateral
Agent, on behalf of the Term Secured Parties, as the loss payee thereunder and
provides for at least thirty days' prior written notice to Collateral Agent of
any modification or cancellation of such policy.
5.6. INSPECTIONS. Each Credit Party will, and will cause each of its
Subsidiaries to, permit any authorized representatives designated by any Lender
to visit and inspect any of the properties of any Credit Party and any of its
respective Subsidiaries, to inspect, copy and take extracts from its and their
financial and accounting records, and to discuss its and their affairs, finances
and accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested; provided, however, that each Lender
shall at all times coordinate with Administrative Agent regarding the frequency
and timing of such visits and inspections so as to reasonably minimize the
burden imposed on the Credit Parties. Additionally Borrower and the Credit
Parties shall permit any authorized representatives designated by Administrative
Agent to conduct, twice per Fiscal Year, audits or other examination of all
books and records of Credit Parties, each such audit to be in scope and
substance reasonably satisfactory to Administrative
67
Agent all upon reasonable notice and at such reasonable times as may reasonably
be requested, or, upon the occurrence and continuance of a Default or Event of
Default, at any time at the request of (and as frequently as may be requested
by) Administrative Agent. Further, each Credit Party shall provide
Administrative Agent, upon its request, with, or allow Administrative Agent or
its representatives to perform, (i) a desktop appraisal for each of the first
three Fiscal Quarters each Fiscal Year and (ii) a supplemental appraisal with
respect thereto for one quarter of such Fiscal Year, or upon the occurrence and
continuance of a Default or an Event of Default, at any time at the request of
Administrative Agent.
5.7. LENDERS MEETINGS. Holdings and Borrower will, upon the request of
Administrative Agent or Requisite Lenders, participate in a meeting of
Administrative Agent and Lenders once during each Fiscal Year to be held at
Borrower's corporate offices (or at such other location as may be agreed to by
Borrower and Administrative Agent) at such time as may be agreed to by Borrower
and Administrative Agent.
5.8. COMPLIANCE WITH LAWS. Each Credit Party will comply, and shall
cause each of its Subsidiaries and all other Persons, if any, on or occupying
any Facilities to comply, with the requirements of all applicable laws, rules,
regulations and orders of any Governmental Authority (including all
Environmental Laws), noncompliance with which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
5.9. ENVIRONMENTAL.
(a) Environmental Disclosure. Holdings will deliver to
Administrative Agent:
(i) as soon as practicable following receipt
thereof, copies of all environmental audits, investigations, analyses
and reports (including any Phase I Reports) of any kind or character,
whether prepared by personnel of Holdings or any of its Subsidiaries or
by independent consultants, Governmental Authorities or any other
Persons, with respect to material environmental matters at any Facility
or with respect to any Environmental Claims;
(ii) promptly upon the occurrence thereof,
written notice describing in reasonable detail (1) any Release required
to be reported to any Governmental Authority under any applicable
Environmental Laws (or any Governmental Authorization issued
thereunder) other than any Release (A) that occurred in the ordinary
course of business and in material compliance with Environmental Law,
or (B) that could not reasonably result in an Environmental Claim that
would have a Material Adverse Effect; (2) any remedial action taken by
Holdings or any other Person in response to (A) any Hazardous Materials
Activities the existence or occurrence of which could reasonably result
in one or more Environmental Claims having, individually or in the
aggregate, a Material Adverse Effect, or (B) any Environmental Claims
that, individually or in the aggregate, could reasonably result in a
Material Adverse Effect, and (3) Holdings' or Borrower's discovery of
any occurrence or condition on any Facility or real property adjoining
or in the vicinity of any Facility that could cause such Facility
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or any part thereof to be subject to any material restrictions on the
ownership, occupancy, transferability or use thereof under any
Environmental Laws;
(iii) as soon as practicable following the
sending or receipt thereof by Holdings or any of its Subsidiaries, a
copy of any and all written communications with respect to (1) any
Environmental Claims that, individually or in the aggregate, could
reasonably result in a Material Adverse Effect, and (2) any request for
information from any Governmental Authority that suggests such
Governmental Authority is investigating whether Holdings or any of its
Subsidiaries may be potentially responsible for any Hazardous Materials
Activity;
(iv) prompt written notice describing in
reasonable detail (1) any proposed acquisition of stock, assets, or
property by Holdings or any of its Subsidiaries that could reasonably
be expected to (A) expose Holdings or any of its Subsidiaries to, or
result in, Environmental Claims that could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect or
(B) affect the ability of Holdings or any of its Subsidiaries to
maintain in full force and effect all material Governmental
Authorizations required under any Environmental Laws for their
respective operations and (2) any proposed action to be taken by
Holdings or any of its Subsidiaries to modify current operations in a
manner that could reasonably be expected to subject Holdings or any of
its Subsidiaries to any additional material obligations or requirements
under any Environmental Laws; and
(v) with reasonable promptness, such other
documents and information as from time to time may be reasonably
requested by Administrative Agent in relation to any matters disclosed
pursuant to this Section 5.9(a).
(b) Hazardous Materials Activities. Subject to Schedule 5.9,
each Credit Party shall, at its sole cost and expense, promptly take or cause to
be taken, and shall cause each of its Subsidiaries promptly to take or cause to
be taken, any and all actions reasonably necessary to (i) cure any violation of
Environmental Laws by such Credit Party or its Subsidiaries that could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, (ii) reasonably effectuate remediation of any Hazardous
Materials in, on, under or from any Facility or otherwise related to any
Hazardous Material Activity that could reasonably be expected to have a Material
Adverse Effect when such remediation is either (A) required under any
Environmental Law or (B) reasonably requested by Administrative Agent in
writing, and (iii) make an appropriate response to any Environmental Claim
against such Credit Party or any of its Subsidiaries and discharge any
obligations it may have to any Person thereunder where failure to do so could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
(c) Environmental Covenants. Subject to Schedule 5.9, each
Credit Party will take or cause to be taken, and shall cause each of its
Subsidiaries to take or cause to be taken, such actions as reasonably necessary
to ensure that: (a) all uses and operations on or of any
69
Facility shall be in material compliance with all Environmental Laws and
Governmental Authorizations issued pursuant thereto; (b) keep or cause all
Facilities free and clear of any material Lien imposed pursuant to Environmental
Laws; (c) conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws (d) there shall be no Releases of Hazardous Materials in, on, under or from
any Facility that would be reasonably likely to result in an Environmental Claim
that could reasonably be expected to have a Material Adverse Effect; and (e)
there shall be no Hazardous Materials in, on, or under any Facility, except
those that are both (i) in material compliance with all Environmental Laws and
with Governmental Authorizations issued pursuant thereto, if and to the extent
required, and (ii) in amounts not materially in excess of that reasonably
necessary for the conduct of the business of such Credit Party or Subsidiary.
5.10. SUBSIDIARIES. In the event that any Person becomes a Domestic
Subsidiary of Borrower, Borrower shall (a) promptly cause such Domestic
Subsidiary to become a Guarantor hereunder and a Grantor under the Term Pledge
and Security Agreement and Intercreditor Agreement by executing and delivering
to Administrative Agent and Collateral Agent a Counterpart Agreement, and (b)
take all such actions and execute and deliver, or cause to be executed and
delivered, all such documents, instruments, agreements, and certificates as are
similar to those described in Sections 3.1(b), 3.1(i), 3.1(j), 3.1(k) and
3.1(n). In the event that any Person becomes a Foreign Subsidiary of Borrower,
and the ownership interests of such Foreign Subsidiary are owned by Borrower or
by any Domestic Subsidiary thereof, Borrower shall, or shall cause such Domestic
Subsidiary to, deliver, all such documents, instruments, agreements, and
certificates as are similar to those described in Sections 3.1(b), and Borrower
shall take, or shall cause such Domestic Subsidiary to take, all of the actions
referred to in Section 3.1(j) necessary to grant and to perfect a First Priority
Lien in favor of Collateral Agent, for the benefit of the Term Secured Parties,
under the Term Pledge and Security Agreement in 65% of such ownership interests.
With respect to each such Subsidiary, Borrower shall promptly send to
Administrative Agent written notice setting forth with respect to such Person
(i) the date on which such Person became a Subsidiary of Borrower, and (ii) all
of the data required to be set forth in Schedules 4.1 and 4.2 with respect to
all Subsidiaries of Borrower; provided, such written notice shall be deemed to
supplement Schedule 4.1 and 4.2 for all purposes hereof.
5.11. ADDITIONAL MATERIAL REAL ESTATE ASSETS. In the event that any
Credit Party acquires a Material Real Estate Asset or a Real Estate Asset owned
or leased on the Closing Date becomes a Material Real Estate Asset and such
interest has not otherwise been made subject to the First Priority Lien of the
Collateral Documents in favor of Collateral Agent, for the benefit of the Term
Secured Parties, then such Credit Party, as soon as practical after and, in any
event, no later than 30 days after, acquiring such Material Real Estate Asset,
shall take all such actions and execute and deliver, or cause to be executed and
delivered, all such mortgages, documents, instruments, agreements, opinions and
certificates similar to those described in Sections 3.1(i), 3.1(j) and 3.1(k)
with respect to each such Material Real Estate Asset that Collateral Agent shall
reasonably request to create a valid and, subject to any filing and/or recording
referred to herein, perfected First Priority Lien in favor of Collateral Agent,
for the benefit of the Term Secured Parties, in such Material Real Estate
Assets. In addition to the foregoing, Borrower shall, at the request of
Requisite Lenders, deliver, from time to time, to Administrative Agent such
appraisals
70
as are required by law or regulation of Real Estate Assets with respect to which
Collateral Agent has been granted a Lien for the benefit of the Term Secured
Parties.
5.12. INTEREST RATE PROTECTION. No later than sixty (60) days following
the Closing Date and at all times thereafter, Borrower shall maintain, or cause
to be maintained, in effect one or more Interest Rate Agreements for a term of
not less than three (3) years and otherwise in form and substance reasonably
satisfactory to Administrative Agent, such that the amount of not less than
50.0% of the aggregate notional principal amount of the total Indebtedness for
borrowed money (excluding Revolving Loans) of Borrower and its Subsidiaries
outstanding from time to time (based on the assumption that such notional
principal amount was a Eurodollar Rate Loan with an Interest Period of three
months) shall be either (i) fixed rate Indebtedness or (ii) subject to Interest
Rate Agreements effectively limiting the Unadjusted Eurodollar Rate Component of
the interest costs to Borrower to a rate reasonably acceptable to Administrative
Agent. Notwithstanding the foregoing, Borrower shall not be required to so
maintain such Interest Rate Agreements to the extent that the aggregate notional
principal amount of the Interest Rate Agreements of Borrower and its
Subsidiaries otherwise required by this Section 5.12 is less than $20,000,000.
5.13. FURTHER ASSURANCES. At any time or from time to time upon the
request of Administrative Agent, each Credit Party will, at its expense,
promptly execute, acknowledge and deliver such further documents and do such
other acts and things as Administrative Agent or Collateral Agent may reasonably
request to ensure that the Obligations are guarantied by the Guarantors and are
secured by substantially all of the assets of Holdings and its Subsidiaries and
all of the outstanding Capital Stock of Borrower and its Subsidiaries (subject
to limitations contained in the Credit Documents with respect to Foreign
Subsidiaries). In addition, each Credit Party will provide Lenders with any
information requested pursuant to Section 10.21.
5.14. CASH MANAGEMENT SYSTEMS. Holdings and its Subsidiaries shall
establish and maintain cash management systems reasonably acceptable to
Administrative Agent. Such systems shall be outlined on Schedule 5.14 (as it may
be amended from time to time with the consent of Administrative Agent).
5.15. LANDLORDS' AGREEMENTS, MORTGAGEE AGREEMENTS, BAILEE LETTERS AND
REAL ESTATE PURCHASES. Each Credit Party shall use its reasonable efforts to
obtain a landlord's agreement, mortgagee agreement or bailee letter, as
applicable, from the lessor of each leased property, mortgagee of owned property
or bailee with respect to any warehouse, processor or converter facility or
other location where any material amount of Collateral is stored or located,
which agreement or letter shall (unless otherwise agreed to in writing by
Administrative Agent) contain a waiver or subordination of all Liens or claims
that the landlord, mortgagee or bailee may assert against the Collateral at that
location, and shall otherwise be reasonably satisfactory in form and substance
to Administrative Agent. Each Credit Party shall timely and fully pay and
perform its obligations under all leases and other agreements with respect to
each leased location or public warehouse where any Collateral is or may be
located except to the extent that the same are being contested in good faith.
5.16. POST-CLOSING OBLIGATIONS. Borrower shall satisfy and perform each
obligation set forth on Schedule 5.16 within the time frame set forth for such
obligation on Schedule 5.16;
71
provided that the Administrative Agent, in its reasonable discretion, may extend
such time frames to provide for reasonable extensions.5.17.
SECTION 6. NEGATIVE COVENANTS
Each Credit Party covenants and agrees that, so long as any Commitment
is in effect and until payment in full of all Obligations, such Credit Party
shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 6.
6.1. INDEBTEDNESS. No Credit Party shall, nor shall it permit any of
its Subsidiaries to, directly or indirectly, create, incur, assume or guaranty,
or otherwise become or remain directly or indirectly liable with respect to any
Indebtedness, except:
(a) the Term Obligations and the Revolving Obligations;
(b) Indebtedness of any Guarantor Subsidiary to Borrower or to
any other Guarantor Subsidiary, or of Borrower to any Guarantor Subsidiary;
provided, (i) all such Indebtedness shall be evidenced by promissory notes and
all such notes shall be subject to a First Priority Lien in favor of Collateral
Agent (for the benefit of the Term Secured Parties) pursuant to the Term Pledge
and Security Agreement, (ii) all such Indebtedness shall be unsecured and
subordinated in right of payment to the payment in full of the Obligations
pursuant to the terms of the applicable promissory notes or an intercompany
subordination agreement that in any such case, is reasonably satisfactory to
Administrative Agent, and (iii) any payment by any such Guarantor Subsidiary
under any guaranty of the Obligations shall result in a pro tanto reduction of
the amount of any Indebtedness owed by such Subsidiary to Borrower or to any of
its Subsidiaries for whose benefit such payment is made;
(c) Indebtedness incurred by Holdings or any of its
Subsidiaries arising from agreements providing for indemnification, adjustment
of purchase price or similar obligations, or from guaranties or letters of
credit, surety bonds or performance bonds securing the performance of Borrower
or any such Subsidiary pursuant to such agreements, in connection with Permitted
Acquisitions or permitted dispositions of any business, assets or Subsidiary of
Holdings or any of its Subsidiaries;
(d) Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, surety, statutory, appeal or similar obligations
incurred in the ordinary course of business;
(e) Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with deposit accounts;
(f) guaranties in the ordinary course of business of the
obligations of suppliers, customers, franchisees and licensees of Holdings and
its Subsidiaries;
(g) guaranties by Borrower of Indebtedness of a Guarantor
Subsidiary or guaranties by a Subsidiary of Borrower of Indebtedness of Borrower
or a Guarantor Subsidiary
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with respect, in each case, to Indebtedness otherwise permitted to be incurred
pursuant to this Section 6.1;
(h) Indebtedness described in Schedule 6.1, but not any
extensions, renewals or replacements of such Indebtedness except (i) renewals
and extensions expressly provided for in the agreements evidencing any such
Indebtedness as the same are in effect on the date of this Agreement and (ii)
refinancings and extensions of any such Indebtedness if the terms and conditions
thereof are not less favorable to the obligor thereon or to the Lenders than the
Indebtedness being refinanced or extended, and the average life to maturity
thereof is greater than or equal to that of the Indebtedness being refinanced or
extended; provided, such Indebtedness permitted under the immediately preceding
clause (i) or (ii) above shall not (A) include Indebtedness of an obligor that
was not an obligor with respect to the Indebtedness being extended, renewed or
refinanced, (B) exceed in a principal amount the Indebtedness being renewed,
extended or refinanced or (C) be incurred, created or assumed if any Default or
Event of Default has occurred and is continuing or would result therefrom;
(i) on or prior to September 30, 2004, Indebtedness evidenced
by any SAC Notes not repurchased in the Debt Tender in an aggregate principal
amount not to exceed $12,000,000;
(j) Indebtedness with respect to (i) Capital Leases, (ii)
purchase money Indebtedness (including any such purchase money Indebtedness
acquired in connection with a Permitted Acquisition), provided, any such
purchase money Indebtedness (x) shall be secured only by the asset acquired in
connection with the incurrence of such Indebtedness, (y) shall constitute not
less than 75% and not more than 100% of the aggregate consideration paid with
respect to such asset; and (z) the Indebtedness incurred pursuant to clauses (i)
and (ii) collectively shall not exceed $10,000,000 at any time; (iii) the
Existing Capital Leases and (iv) Permitted Refinancings of the foregoing;
(k) (x) the Senior Subordinated Notes and (y) senior
subordinated unsecured debt securities issued to redeem the Senior Subordinated
Notes in full, in an aggregate principal amount of up to the sum of the
aggregate outstanding principal amount of the Senior Subordinated Notes (but in
any event not to exceed $160,000,000) plus any reasonable and customary
transaction costs and fees (approved by Administrative Agent) and required
premium incurred in connection therewith (the "REFINANCING NOTES"); provided
that the proceeds thereof are used to prepay or redeem the Senior Subordinated
Notes and/or prepay the Term Loans, or a portion thereof, and reasonable and
customary fees, commissions, legal fees and other costs and expenses incurred in
connection with such issuance and redemption or prepayment; provided, further,
that (i)(A) the terms of such additional Indebtedness shall not contain any
cross-default provisions (other than for material non-payment, and may include a
cross-acceleration provision), (B) the terms of the Refinancing Notes shall not
contain any financial maintenance covenants, (C) the Refinancing Notes shall not
be secured by any asset of Borrower or any of its Subsidiaries, (D) no portion
of the principal of the Refinancing Notes shall be scheduled to be redeemed,
repurchased or otherwise repaid or prepaid (other than as a result of a change
of control, acceleration or such other provision as shall be customary for
comparable high-yield debt securities) prior to the date that is ninety-one (91)
days after the Term Loan Maturity Date, and (E) the Refinancing Notes shall
otherwise, taken as a whole, be on terms no less favorable to
73
the Lenders than the terms of the Senior Subordinated Notes; and (ii) after
giving effect to the incurrence of the Refinancing Notes, no Default or Event of
Default shall exist or would result therefrom;
(l) Indebtedness under Hedge Agreements or any commodities
hedging agreement entered into for the purpose of hedging risks associated with
Holdings' and its Subsidiaries' operations and not for speculative purposes;
(m) (i) Indebtedness of any Foreign Subsidiary, consisting of
local lines of credit incurred in the ordinary course of business of such
Foreign Subsidiary and not guaranteed by a Guarantor Subsidiary, in an aggregate
amount not to exceed at any time the U.S. dollar equivalent of $10,000,000 and
(ii) Indebtedness of any Foreign Subsidiary, consisting of an Investment made by
a Credit Party to such Foreign Subsidiary as permitted by Section 6.7(j); and
(n) (i) Indebtedness of non-Guarantor Subsidiaries to other
non-Guarantor Subsidiaries and (ii) Indebtedness of Borrower or Guarantor
Subsidiaries to non-Guarantor Subsidiaries in an amount not to exceed $3,000,000
in the aggregate at any time outstanding;
(o) Indebtedness to finance the repurchase price of Holdings
stock from former employees; provided such Indebtedness is subordinated to the
Term Obligations on terms and conditions reasonably acceptable to the
Administrative Agent;
(p) Indebtedness assumed in Permitted Acquisitions and any
deferred purchase price for Permitted Acquisitions in an amount not to exceed
$5,000,000 per acquisition and $10,000,000 in the aggregate at any time
outstanding; and
(q) other unsecured Indebtedness of Holdings and its
Subsidiaries in an aggregate amount not to exceed at any time $15,000,000.
6.2. LIENS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the UCC of any State or under any similar recording or notice
statute, except:
(a) Liens in favor of Collateral Agent for the benefit of the
Term Secured Parties granted pursuant to any Credit Document and Liens in favor
of the Revolving Collateral Agent for the benefit of the Revolving Secured
Parties granted pursuant to any Credit Document (as defined in the Revolving
Credit Agreement), as in effect on the date hereof and as amended, supplemented
or modified from time to time in accordance with the terms of the Intercreditor
Agreement;
(b) Liens for Taxes not then due or, if due, if obligations
with respect to such Taxes are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted;
74
(c) statutory Liens of landlords, banks (and rights of
set-off), carriers, warehousemen, mechanics, repairmen, workmen and materialmen,
and other Liens imposed by law (other than any such Lien imposed pursuant to
Section 401 (a)(29) or 412(n) of the Internal Revenue Code or by ERISA), in each
case incurred in the ordinary course of business (i) for amounts not yet overdue
or (ii) for amounts that are overdue and that are being contested in good faith
by appropriate proceedings, so long as such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been made for any
such contested amounts;
(d) Liens incurred in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other types of
social security, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;
(e) easements, rights-of-way, restrictions, encroachments, and
other minor defects or irregularities in title, in each case which do not and
will not interfere in any material respect with the ordinary conduct of the
business of Holdings or any of its Subsidiaries;
(f) any interest or title of a lessor or sublessor under any
lease of real estate permitted hereunder and any restriction, lien or
encumbrance that the interest or title of such lessor or sublessor may be
subject to;
(g) Liens solely on any xxxx xxxxxxx money deposits made by
Holdings or any of its Subsidiaries in connection with any letter of intent or
purchase agreement permitted hereunder;
(h) purported Liens evidenced by the filing of precautionary
UCC financing statements relating solely to operating leases of personal
property entered into in the ordinary course of business;
(i) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection with the
importation of goods;
(j) any zoning or similar law or right reserved to or vested
in any governmental office or agency to control or regulate the use of any real
property;
(k) (i) licenses of patents, trademarks and other intellectual
property rights granted by Holdings or any of its Subsidiaries in the ordinary
course of business and not interfering in any respect with the ordinary conduct
of the business of Borrower or such Subsidiary and (ii) leases or subleases
granted by Holdings or any of its Subsidiaries to third parties in respect of
surplus property which is not fundamental to the operation of the business in
the ordinary course of business; provided that such leases and subleases are on
arms-length, commercial terms and otherwise satisfactory to Administrative
Agent;
(l) Liens described in Schedule 6.2, with respect to Real
Estate Assets, or on a title report delivered pursuant to Section 3.1(i)(iii);
75
(m) Liens securing Indebtedness permitted pursuant to 6.1(j);
provided, any such Lien shall encumber only the asset acquired with the proceeds
of such Indebtedness;
(n) Liens securing Indebtedness of Foreign Subsidiaries
permitted pursuant to Section 6.1(m), provided that such Liens only attach to
the assets of Foreign Subsidiaries;
(o) Liens securing judgments for the payment of money (except
to the extent giving rise to an Event of Default under Section 8.1(h));
(p) Liens that are contractual rights of setoff (i) relating
to the establishment of depository relations with banks not given in connection
with the issuance of Indebtedness or (ii) pertaining to pooled deposit and/or
sweep accounts of Borrower and/or any Subsidiary of Borrower to permit
satisfaction of overdraft or similar obligations incurred in the ordinary course
of business of Borrower and the Subsidiaries of Borrower; and
(q) other Liens securing Indebtedness in an aggregate amount
not to exceed $5,000,000 at any time outstanding.
6.3. EQUITABLE LIEN. If any Credit Party or any of its Subsidiaries
shall create or assume any Lien upon any of its properties or assets (a) of a
kind or nature comparable to the Liquid Collateral, whether now owned or
hereafter acquired, other than Permitted Liens, it shall make or cause to be
made effective provisions whereby the Revolving Obligations will be secured by
such Lien equally and ratably with any and all other Indebtedness (other than
the Term Obligations) secured thereby as long as any such Indebtedness shall be
so secured and the Term Obligations will (x) so long as the Revolving
Obligations are so secured, have a Second Priority Lien on such properties or
assets and (y) if the Revolving Obligations have been discharged, be secured by
such Lien equally and ratably with any and all other Indebtedness secured
thereby as long as any such Indebtedness shall be so secured and (b) of a kind
or nature comparable to the Fixed Collateral, whether now owned or hereafter
acquired, it shall make or cause to be made effective provisions whereby the
Term Obligations will be secured by such Lien equally and ratably with any and
all other Indebtedness (other than the Revolving Obligations) secured thereby as
long as any such Indebtedness shall be so secured; provided, notwithstanding the
foregoing, this covenant shall not be construed as a consent by Requisite
Lenders to the creation or assumption of any such Lien not otherwise permitted
hereby.
6.4. NO FURTHER NEGATIVE PLEDGES. EXCEPT WITH RESPECT TO:
(a) specific property encumbered to secure payment of particular
Indebtedness or to be sold pursuant to an executed agreement with respect to a
permitted Asset Sale;
(b) restrictions contained in agreements with respect to Indebtedness
incurred by Foreign Subsidiaries in accordance with this Agreement (provided
that such restrictions are limited to the property or assets of such Foreign
Subsidiary and its Subsidiaries);
(c) restrictions contained in (x) the Senior Subordinated Notes
Indenture, (y) the indenture in respect of the Refinancing Notes (provided that
such restrictions are no less favorable to the Lenders than those contained in
the Senior Subordinated Notes Indenture) and (z) the Revolving Credit Agreement
or any document evidencing a Permitted Refinancing
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thereof (provided that such restrictions are no less favorable to the Lenders
than those contained in the Revolving Credit Agreement);
(d) restrictions by reason of customary provisions restricting
assignments, subletting or other transfers contained in leases, licenses and
similar agreements entered into in the ordinary course of business (provided
that such restrictions are limited to the property or assets secured by such
Liens or the property or assets subject to such leases, licenses or similar
agreements, as the case may be);
(e) Liens permitted to be incurred under Section 6.2 and restrictions
in the agreements relating thereto that limit the right of Borrower to dispose
of or transfer the assets subject to such Liens;
(f) provisions limiting the disposition or distribution of assets or
property in joint venture agreements, sale-leaseback agreements, stock sale
agreements and other similar agreements, which limitation is applicable only to
the assets that are the subject of such agreements;
(g) any encumbrance or restriction in connection with an acquisition of
property, so long as such encumbrance or restriction relates solely to the
property so acquired and was not created in connection with or in anticipation
of such acquisition; and
(h) restrictions imposed by customary provisions in partnership
agreements, limited liability company organizational governance documents, joint
venture agreements and other similar agreements that restrict the transfer of
ownership interests in such partnership, limited liability company, joint
venture or similar Person;
no Credit Party nor any of its Subsidiaries shall enter into any agreement
prohibiting the creation or assumption of any Lien upon any of its properties or
assets, whether now owned or hereafter acquired.
6.5. RESTRICTED JUNIOR PAYMENTS. No Credit Party shall, nor shall it
permit any of its Subsidiaries or Affiliates through any manner or means or
through any other Person to, directly or indirectly, declare, order, pay, make
or set apart, or agree to declare, order, pay, make or set apart, any sum for
any Restricted Junior Payment except that:
(a) Borrower may make regularly scheduled payments of interest in
respect of Senior Subordinated Notes or Refinancing Notes in accordance with the
terms of, and only to the extent required by, and subject to the subordination
provisions contained in, the indenture or other agreement pursuant to which such
Subordinated Indebtedness was issued;
(b) Borrower may prepay or redeem the Senior Subordinated Notes in full
with the proceeds of the Refinancing Notes;
(c) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Borrower may make Restricted Junior
Payments to Holdings (and Holdings may make Restricted Junior Payments to its
corporate parent) (i) in an aggregate amount not to exceed $500,000 in any
Fiscal Year, to the extent necessary to permit Holdings (or
77
its corporate parent) to pay general administrative costs and expenses and (ii)
to the extent necessary to permit Holdings (or its corporate parent) to
discharge the consolidated tax liabilities of Holdings (or its corporate parent)
and its Subsidiaries, in each case so long as Holdings (or its corporate parent)
applies the amount of any such Restricted Junior Payment for such purpose;
(d) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Borrower may repurchase the SAC Notes
which were not tendered in connection with the Debt Tender;
(e) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Holdings may purchase or redeem (and
Borrower may declare and pay dividends or make other distributions to Holdings
the proceeds of which are to be used by Holdings to so purchase or redeem), and
may make Restricted Junior Payments to Holdings' corporate parent to redeem,
Capital Stock of Holdings or its corporate parent, as the case may be (including
related stock appreciation rights or similar securities) held by then present or
former officers or employees of Holdings, Borrower or any of their Subsidiaries
or by any Pension Plan upon such person's death, disability, retirement or
termination of employment or under the terms of any such Pension Plan or any
other agreement under which such shares of stock or related rights were issued;
provided that the aggregate amount of such purchases or redemptions under this
paragraph (e) shall not exceed in any Fiscal Year $3,000,000 plus the unused
portion of the permitted Restricted Junior Payments under this paragraph (e)
from the immediately prior Fiscal Year (which carryover amount may only be
utilized in such current Fiscal Year and not in subsequent Fiscal Years); and
(f) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Holdings may pay management fees to
the Sponsor in an amount not to exceed $1,000,000 per Fiscal Year and reasonable
one-time transaction fees and reasonable expenses; provided that if such
one-time transaction fees and expenses exceed $250,000 they shall have been
approved by the disinterested members of the Borrower's board of directors.
6.6. RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS. Except as provided
herein, in the Revolving Credit Agreement or any document evidencing a Permitted
Refinancing thereof (provided that such restrictions are no less favorable to
the Lenders than those contained in the Revolving Credit Agreement), in the
Senior Subordinated Notes Indenture or in the indenture in respect of the
Refinancing Notes (as long as such encumbrances or restrictions are no less
favorable to the Lenders than those contained in the Senior Subordinated Notes
Indenture) or (with respect to encumbrances or restrictions on the ability of
any Foreign Subsidiary of Holdings only) in any documentation evidencing the
local lines of credit of Foreign Subsidiaries expressly permitted by Section
6.1(m), no Credit Party shall, nor shall it permit any of its Subsidiaries to,
create or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary of
Borrower to:
(a) pay dividends or make any other distributions on any of such
Subsidiary's Capital Stock owned by Borrower or any other Subsidiary of
Borrower;
(b) repay or prepay any Indebtedness owed by such Subsidiary to
Borrower or any other Subsidiary of Borrower;
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(c) make loans or advances to Borrower or any other Subsidiary of
Borrower; or
(d) transfer any of its property or assets to Borrower or any other
Subsidiary of Borrower;
other than restrictions:
(i) in agreements evidencing Indebtedness
permitted by Section 6.1(j) that impose restrictions on the property so
acquired;
(ii) by reason of customary provisions
restricting assignments, subletting or other transfers contained in
leases, licenses, joint venture agreements and similar agreements
entered into in the ordinary course of business;
(iii) that are or were created by virtue of
any transfer of, agreement to transfer or option or right with respect
to any property, assets or Capital Stock not otherwise prohibited under
this Agreement;
(iv) in any instrument governing
Indebtedness or Capital Stock of a Person acquired by Borrower or any
of its Subsidiaries as in effect at the time of such acquisition
(except to the extent such Indebtedness or Capital Stock was incurred
in connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired; provided that, in the
case of Indebtedness, such Indebtedness was permitted by Section 6.1 to
be incurred;
(v) in any agreement for the sale or other
disposition of a Subsidiary that restricts distributions by that
Subsidiary pending the sale or other disposition; and
(vi) in provisions in agreements or
instruments which prohibit the payment of dividends or the making of
other distributions with respect to any class of Capital Stock of a
Person other than on a pro rata basis.
6.7. INVESTMENTS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including without limitation any Joint Venture, except:
(a) Investments in Cash and Cash Equivalents;
(b) equity Investments owned as of the Closing Date in any
Subsidiary and Investments made after the Closing Date in any wholly owned
Guarantor Subsidiaries of Borrower;
(c) Investments (i) in any Securities received in satisfaction
or partial satisfaction thereof from financially troubled account debtors and
(ii) consisting of deposits, prepayments
79
and other credits to suppliers made in the ordinary course of business of
Holdings and its Subsidiaries;
(d) intercompany loans to the extent permitted under Section
6.1(b) and intercompany guaranties to the extent permitted under Section 6.1(g);
(e) Consolidated Capital Expenditures;
(f) loans and advances to employees of Holdings and its
Subsidiaries made in the ordinary course of business in an aggregate principal
amount not to exceed $1,000,000 in the aggregate at any one time outstanding;
(g) Investments made in connection with Permitted Acquisitions
permitted pursuant to Section 6.9;
(h) Investments described in Schedule 6.7;
(i) other Investments in an aggregate amount not to exceed at
any time $10,000,000 plus the portion of Excess Cash Flow not used for mandatory
prepayments of the Loans;
(j) Investments in Foreign Subsidiaries of Holdings in an
aggregate amount not to exceed $5,000,000 per Fiscal Year;
(k) Investments received in lieu of Cash in connection with
Asset Sales expressly permitted by Section 6.9;
(l) Notes from buyers of permitted dispositions in an
aggregate amount not to exceed $5,000,000 at any one time outstanding; and
(m) Notes from employees for sale of Holdings stock.
Notwithstanding the foregoing, in no event shall any Credit Party make any
Investment which results in or facilitates in any manner any Restricted Junior
Payment not otherwise permitted under the terms of Section 6.5.
6.8. [RESERVED].
6.9. FUNDAMENTAL CHANGES; DISPOSITION OF ASSETS; ACQUISITIONS. No
Credit Party shall, nor shall it permit any of its Subsidiaries to, enter into
any transaction of merger or consolidation, or liquidate, wind-up or dissolve
itself (or suffer any liquidation or dissolution), or convey, sell, lease or
sub-lease (as lessor or sublessor), exchange, transfer or otherwise dispose of,
in one transaction or a series of transactions, all or any part of its business,
assets or property of any kind whatsoever, whether real, personal or mixed and
whether tangible or intangible, whether now owned or hereafter acquired, or
acquire by purchase or otherwise (other than purchases or other acquisitions of
inventory, materials, supplies, equipment and capital expenditures in the
ordinary course of business) the business, property or fixed assets of, or stock
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or other evidence of beneficial ownership of, any Person or any division or line
of business or other business unit of any Person, except:
(a) (i) any Subsidiary of Holdings may be merged with or into
Borrower or any Guarantor Subsidiary, and any Subsidiary of Holdings (other than
Borrower or a Guarantor Subsidiary (other than an Immaterial Subsidiary)) may be
liquidated, wound up or dissolved (following the transfer of all its assets to
Borrower or a Guarantor Subsidiary), and all or any part of the business,
property or assets of any Subsidiary of Holdings may be conveyed, sold, leased,
transferred or otherwise disposed of, in one transaction or a series of
transactions, to Borrower or any Guarantor Subsidiary; provided, in the case of
such a merger, Borrower or such Guarantor Subsidiary, as applicable shall be the
continuing or surviving Person and (ii) any non-Guarantor Subsidiary of Holdings
may be merged with or into Holdings or any Subsidiary of Holdings, and any
non-Guarantor Subsidiary of Holdings may be liquidated, wound up or dissolved
(following the transfer of all its assets to Borrower or a Subsidiary of
Borrower), and all or any part of the business, property or assets of any
non-Guarantor Subsidiary of Holdings may be conveyed, sold, leased, transferred
or otherwise disposed of, in one transaction or a series of transactions, to
Borrower or any Subsidiary of Borrower;
(b) sales or other dispositions of assets that do not
constitute Asset Sales;
(c) Asset Sales, the proceeds of which (valued at the
principal amount thereof in the case of non-Cash proceeds consisting of notes or
other debt Securities and valued at fair market value in the case of other
non-Cash proceeds) are less than $25,000,000 when aggregated with the proceeds
of all other Asset Sales made within the same Fiscal Year; provided (1) the
consideration received for such assets shall be in an amount at least equal to
the fair market value thereof (determined in good faith by the board of
directors of Borrower (or similar governing body)), (2) no less than 75% thereof
shall be paid in Cash, (3) the Net Asset Sale Proceeds thereof shall be applied
as required by Section 2.13(a) and (4) pending such application pursuant to
Section 2.13(a) or any other use of such Net Asset Sale Proceeds permitted
hereby, Borrower shall deposit all such Net Asset Sale Proceeds to the extent
derived from assets constituting Fixed Collateral in the Asset Sale Proceeds
Account;
(d) disposals of obsolete, worn out or surplus property;
(e) Permitted Acquisitions, the consideration for which
constitutes (i) less than $7,500,000 in the aggregate in any Fiscal Year and
(ii) less than $25,000,000 in the aggregate from the Closing Date to the date of
determination; and
(f) Investments made in accordance with Section 6.7.
6.10. DISPOSAL OF SUBSIDIARY INTERESTS. Except for any sale of all of
its interests in the Capital Stock of any of its Subsidiaries in compliance with
the provisions of Section 6.9, no Credit Party shall, nor shall it permit any of
its Subsidiaries to, (a) directly or indirectly sell, assign, pledge or
otherwise encumber or dispose of any Capital Stock of any of its Subsidiaries,
except to qualify directors if required by applicable law; or (b) permit any of
its Subsidiaries directly or indirectly to sell, assign, pledge or otherwise
encumber or dispose of any Capital
81
Stock of any of its Subsidiaries, except to another Credit Party (subject to the
restrictions on such disposition otherwise imposed hereunder), or to qualify
directors if required by applicable law.
6.11. SALES AND LEASE-BACKS. Unless the proceeds resulting from such
transaction are used to prepay Loans to the extent required by Section 2.13, no
Credit Party shall, nor shall it permit any of its Subsidiaries to, directly or
indirectly, become or remain liable as lessee or as a guarantor or other surety
with respect to any lease of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, which such Credit Party (a) has sold or
transferred or is to sell or to transfer to any other Person (other than
Holdings or any of its Subsidiaries), or (b) intends to use for substantially
the same purpose as any other property which has been or is to be sold or
transferred by such Credit Party to any Person (other than Holdings or any of
its Subsidiaries) in connection with such lease.
6.12. TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. No Credit Party
shall, nor shall it permit any of its Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
holder of 5% or more of any class of Capital Stock of Holdings or any of its
Subsidiaries or with any Affiliate of Holdings or of any such holder, on terms
that are less favorable to Holdings or that Subsidiary, as the case may be, than
those that might be obtained at the time from a Person who is not such a holder
or Affiliate; provided, the foregoing restriction shall not apply to (a) any
transaction between Borrower and any Guarantor Subsidiary; (b) reasonable and
customary fees paid to members of the board of directors (or similar governing
body) of Holdings and its Subsidiaries; (c) compensation arrangements for
officers and other employees of Holdings and its Subsidiaries entered into in
the ordinary course of business; (d) transactions described in Schedule 6.12;
and (f) transactions permitted under Sections 6.1(b), (g), (m)(ii), (n) and (o),
6.5(c), (e) and (f), and 6.7(d), (f), (j) and (m).
6.13. CONDUCT OF BUSINESS. From and after the Closing Date, no Credit
Party shall, nor shall it permit any of its Subsidiaries to, engage in any
business other than (i) the businesses engaged in by such Credit Party on the
Closing Date and similar or related businesses and (ii) such other lines of
business as may be consented to by Requisite Lenders.
6.14. PERMITTED ACTIVITIES OF HOLDINGS. Holdings shall not (a) incur,
directly or indirectly, any Indebtedness or any other obligation or liability
whatsoever other than (x) obligations not constituting Indebtedness incurred in
the ordinary course of its business as a holding company and not otherwise
restricted by this Section 6.14 and (y) the Revolving Obligations, the Term
Obligations or its obligations in respect of the Senior Subordinated Notes or
any Refinancing Notes; (b) create or suffer to exist any Lien upon any property
or assets now owned or hereafter acquired by it other than the Liens created
under the Collateral Documents to which it is a party; (c) engage in any
business or activity or own any assets other than (i) holding 100% of the
Capital Stock of Borrower, (ii) performing its obligations and activities
incidental thereto under the Credit Documents, and to the extent not
inconsistent therewith, the Related Agreements; and (iii) making Restricted
Junior Payments and Investments to the extent permitted by this Agreement; (d)
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person; (e) sell or otherwise dispose of
any Capital Stock of any of its directly owned Subsidiaries; (f) create or
acquire any Subsidiary or make or
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own any Investment in any Person other than Borrower; or (g) fail to hold itself
out to the public as a legal entity separate and distinct from all other
Persons.
6.15. AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS. Except as
set forth in Section 6.16, no Credit Party shall nor shall it permit any of its
Subsidiaries to, agree to any amendment, restatement, supplement or other
modification to, or waiver of, any of its rights under any Related Agreement
(other than agreements with respect to the Senior Subordinated Notes and
Refinancing Notes which are subject to the provisions of Section 6.16) after the
Closing Date that would be materially adverse to Borrower, any other Credit
Party, Administrative Agent or the Lenders.
6.16. AMENDMENTS OR WAIVERS WITH RESPECT TO SUBORDINATED
INDEBTEDNESS. (a) No Credit Party shall, nor shall it permit any of its
Subsidiaries to, amend or otherwise change the terms of the Senior Subordinated
Notes or Refinancing Notes, or make any payment consistent with an amendment
thereof or change thereto, if the effect of such amendment or change is to
increase the interest rate on the Senior Subordinated Notes or Refinancing
Notes, change (to earlier dates) any dates upon which payments of principal or
interest are due thereon, change any event of default or condition to an event
of default with respect to the Senior Subordinated Notes or the Refinancing
Notes (other than to eliminate any such event of default or increase any grace
period related thereto), change the redemption, prepayment or defeasance
provisions of the Senior Subordinated Notes or the Refinancing Notes, change the
subordination provisions of the Senior Subordinated Notes or the Refinancing
Notes (or of any guaranty thereof), or if the effect of such amendment or
change, together with all other amendments or changes made, is to increase
materially the obligations of the obligor thereunder or to confer any additional
rights on the holders of such Senior Subordinated Notes or Refinancing Notes (or
a trustee or other representative on their behalf) which would be adverse to any
Credit Party or Lenders.
6.17. FISCAL YEAR. (i) No Credit Party shall, nor shall it permit any
of its Guarantor Subsidiaries to change its Fiscal Year-end from December 31 and
(ii) no Credit Party shall permit any non-Guarantor Subsidiaries to change its
Fiscal Year-end from December 31 or November 30, as the case may be.
6.18. NO OTHER "DESIGNATED SENIOR INDEBTEDNESS". No Credit Party shall
designate, or permit the designation of, any Indebtedness (other than under this
Agreement or the other Credit Documents) as "Designated Senior Debt" or
"Designated Senior Indebtedness" or a comparable term evidencing such
designation for the purposes of the definition of the same or the subordination
provisions contained in the Senior Subordinated Notes Indenture or the
Refinancing Note Indenture without the consent of Administrative Agent.
SECTION 7. GUARANTY
7.1. GUARANTY OF THE OBLIGATIONS. Subject to the provisions of Section
7.2, Guarantors jointly and severally hereby irrevocably and unconditionally
guaranty to Administrative Agent for the ratable benefit of the Beneficiaries
the due and punctual payment and performance in full of all Term Obligations
when the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would
83
become due but for the operation of the automatic stay under Section 362(a) or
any other provision of the Bankruptcy Code) (collectively, the "GUARANTEED
OBLIGATIONS").
7.2. CONTRIBUTION BY GUARANTORS. All Guarantors desire to allocate
among themselves (collectively, the "CONTRIBUTING GUARANTORS"), in a fair and
equitable manner, their obligations arising under this Guaranty. Accordingly, in
the event any payment or distribution is made on any date by a Guarantor (a
"FUNDING GUARANTOR") under this Guaranty such that its Aggregate Payments
exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled
to a contribution from each of the other Contributing Guarantors in an amount
sufficient to cause each Contributing Guarantor's Aggregate Payments to equal
its Fair Share as of such date. "FAIR SHARE" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (a)
the ratio of (i) the Fair Share Contribution Amount with respect to such
Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution
Amounts with respect to all Contributing Guarantors multiplied by (b) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under this Guaranty in respect of the obligations Guaranteed. "FAIR
SHARE CONTRIBUTION AMOUNT" means, with respect to a Contributing Guarantor as of
any date of determination, the maximum aggregate amount of the obligations of
such Contributing Guarantor under this Guaranty that would not render its
obligations hereunder or thereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable applicable provisions of state law; provided, solely for
purposes of calculating the "FAIR SHARE CONTRIBUTION AMOUNT" with respect to any
Contributing Guarantor for purposes of this Section 7.2, any assets or
liabilities of such Contributing Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. "AGGREGATE PAYMENTS" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (1)
the aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Guaranty (including,
without limitation, in respect of this Section 7.2), minus (2) the aggregate
amount of all payments received on or before such date by such Contributing
Guarantor from the other Contributing Guarantors as contributions under this
Section 7.2. The amounts payable as contributions hereunder shall be determined
as of the date on which the related payment or distribution is made by the
applicable Funding Guarantor. The allocation among Contributing Guarantors of
their obligations as set forth in this Section 7.2 shall not be construed in any
way to limit the liability of any Contributing Guarantor hereunder. Each
Guarantor is a third party beneficiary to the contribution agreement set forth
in this Section 7.2.
7.3. PAYMENT BY GUARANTORS. Subject to Section 7.2, Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in equity
against any Guarantor by virtue hereof, that upon the failure of Borrower to pay
any of the Guaranteed Obligations when and as the same shall become due, whether
at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) or any other provision of the Bankruptcy
Code), Guarantors will upon demand pay, or cause to be paid, in Cash, to
Administrative Agent for the ratable benefit of Beneficiaries, an amount equal
to the sum of the unpaid principal amount of all Guaranteed Obligations then due
as aforesaid, accrued and unpaid interest on such Guaranteed Obligations
84
(including interest which, but for Borrower's becoming the subject of a case
under the Bankruptcy Code, would have accrued on such Guaranteed Obligations,
whether or not a claim is allowed against Borrower for such interest in the
related bankruptcy case) and all other Guaranteed Obligations then owed to
Beneficiaries as aforesaid.
7.4. LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and unconditional,
constitute primary obligations of such Guarantor and not a contract of surety to
the maximum extent permitted by law, and to the extent permitted by applicable
law shall not be affected by any circumstance which constitutes a legal or
equitable discharge of a guarantor or surety other than payment in full of the
Guaranteed Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:
(a) this Guaranty is a guaranty of payment when due and not of
collectability. This Guaranty is a primary obligation of each Guarantor and not
merely a contract of surety;
(b) the obligations of each Guarantor hereunder are
independent of the obligations of Borrower and the obligations of any other
guarantor (including any other Guarantor) of the obligations of Borrower, and a
separate action or actions may be brought and prosecuted against such Guarantor
whether or not any action is brought against Borrower or any of such other
guarantors and whether or not Borrower is joined in any such action or actions;
(c) payment by any Guarantor of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge any
Guarantor's liability for any portion of the Guaranteed Obligations which has
not been paid. Without limiting the generality of the foregoing, if
Administrative Agent is awarded a judgment in any suit brought to enforce any
Guarantor's covenant to pay a portion of the Guaranteed Obligations, such
judgment shall not be deemed to release such Guarantor from its covenant to pay
the portion of the Guaranteed Obligations that is not the subject of such suit,
and such judgment shall not, except to the extent satisfied by such Guarantor,
limit, affect, modify or abridge any other Guarantor's liability hereunder in
respect of the Guaranteed Obligations;
(d) any Beneficiary, upon such terms as it deems appropriate,
without notice or demand and without affecting the validity or enforceability
hereof or giving rise to any reduction, limitation, impairment, discharge or
termination of any Guarantor's liability hereunder, from time to time may:
(i) renew, extend, accelerate, increase the
rate of interest on, or otherwise change the time, place, manner or
terms of payment of the Guaranteed Obligations;
(ii) settle, compromise, release or
discharge, or accept or refuse any offer of performance with respect
to, or substitutions for, the Guaranteed Obligations or any agreement
relating thereto and/or subordinate the payment of the same to the
payment of any other obligations;
85
(iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment
hereof or the Guaranteed Obligations;
(iv) release, surrender, exchange,
substitute, compromise, settle, rescind, waive, alter, subordinate or
modify, with or without consideration, any security for payment of the
Guaranteed Obligations, any other guaranties of the Guaranteed
Obligations, or any other obligation of any Person (including any other
Guarantor) with respect to the Guaranteed Obligations;
(v) enforce and apply any security now or
hereafter held by or for the benefit of such Beneficiary in respect
hereof or the Guaranteed Obligations and direct the order or manner of
sale thereof, or exercise any other right or remedy that such
Beneficiary may have against any such security, in each case as such
Beneficiary in its discretion may determine consistent herewith or the
applicable Hedge Agreement and any applicable security agreement,
including foreclosure on any such security pursuant to one or more
judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable, and even though such action operates
to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of any Guarantor against Borrower or any security
for the Guaranteed Obligations; and
(vi) exercise any other rights available to
it under the Credit Documents or the Hedge Agreements; and
(e) this Guaranty and the obligations of Guarantors hereunder
shall be valid and enforceable and to the extent permitted by applicable law
shall not be subject to any reduction, limitation, impairment, discharge or
termination for any reason (other than payment in full of the Guaranteed
Obligations), including the occurrence of any of the following, whether or not
any Guarantor shall have had notice or knowledge of any of them:
(i) any failure or omission to assert or
enforce or agreement or election not to assert or enforce, or the stay
or enjoining, by order of court, by operation of law or otherwise, of
the exercise or enforcement of, any claim or demand or any right, power
or remedy (whether arising under the Credit Documents or the Hedge
Agreements, at law, in equity or otherwise) with respect to the
Guaranteed Obligations or any agreement relating thereto, or with
respect to any other guaranty of or security for the payment of the
Guaranteed Obligations;
(ii) any rescission, waiver, amendment or
modification of, or any consent to departure from, any of the terms or
provisions (including provisions relating to events of default) hereof,
any of the other Credit Documents, any of the Hedge Agreements or any
agreement or instrument executed pursuant thereto, or of any other
guaranty or security for the Guaranteed Obligations, in each case
whether or not in accordance with the terms hereof or such Credit
Document, such Hedge Agreement or any agreement relating to such
86
other guaranty or security (provided that no Credit Document to which
such Guarantor is a party may be amended without its written consent);
(iii) the Guaranteed Obligations, or any
agreement relating thereto, at any time being found to be illegal,
invalid or unenforceable in any respect;
(iv) the application of payments received
from any source (other than payments received pursuant to the other
Credit Documents or any of the Hedge Agreements or from the proceeds of
any security for the Guaranteed Obligations, except to the extent such
security also serves as collateral for indebtedness other than the
Guaranteed Obligations) to the payment of indebtedness other than the
Guaranteed Obligations, even though any Beneficiary might have elected
to apply such payment to any part or all of the Guaranteed Obligations;
(v) any Beneficiary's consent to the change,
reorganization or termination of the corporate structure or existence
of Holdings or any of its Subsidiaries and to any corresponding
restructuring of the Guaranteed Obligations;
(vi) any failure to perfect or continue
perfection of a security interest in any collateral which secures any
of the Guaranteed Obligations;
(vii) any defenses, set-offs or
counterclaims which Borrower may allege or assert against any
Beneficiary in respect of the Guaranteed Obligations, including failure
of consideration, breach of warranty, payment, statute of frauds,
statute of limitations, accord and satisfaction and usury; and
(viii) any other act or thing or omission,
or delay to do any other act or thing, which may or might in any manner
or to any extent vary the risk of any Guarantor as an obligor in
respect of the Guaranteed Obligations.
7.5. WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the
benefit of Beneficiaries to the extent permitted by applicable law:
(a) any right to require any Beneficiary, as a condition of
payment or performance by such Guarantor, to (i) proceed against Borrower, any
other guarantor (including any other Guarantor) of the Guaranteed Obligations or
any other Person, (ii) proceed against or exhaust any security held from
Borrower, any such other guarantor or any other Person, (iii) proceed against or
have resort to any balance of any Deposit Account or credit on the books of any
Beneficiary in favor of Borrower or any other Person, or (iv) pursue any other
remedy in the power of any Beneficiary whatsoever;
(b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of Borrower or any other Guarantor
including any defense based on or
87
arising out of the lack of validity or the unenforceability of the Guaranteed
Obligations or any agreement or instrument relating thereto or by reason of the
cessation of the liability of Borrower or any other Guarantor from any cause
other than payment in full in Cash of the Guaranteed Obligations;
(c) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal;
(d) any defense based upon any Beneficiary's errors or
omissions in the administration of the Guaranteed Obligations, except behavior
which amounts to bad faith;
(e) (i) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms hereof and any legal
or equitable discharge of such Guarantor's obligations hereunder, (ii) the
benefit of any statute of limitations affecting such Guarantor's liability
hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments
and counterclaims, and (iv) promptness, diligence and any requirement that any
Beneficiary protect, secure, perfect or insure any security interest or lien or
any property subject thereto;
(f) notices, demands, presentments, protests, notices of
protest, notices of dishonor and notices of any action or inaction, including
acceptance hereof, notices of default hereunder, under the Hedge Agreements or
under any agreement or instrument related thereto, notices of any renewal,
extension or modification of the Guaranteed Obligations or any agreement related
thereto, notices of any extension of credit to Borrower and notices of any of
the matters referred to in Section 7.4 and any right to consent to any thereof;
and
(g) any defenses or benefits that may be derived from or
afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms hereof.
7.6. GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guaranteed Obligations shall have been indefeasibly paid in full, each Guarantor
hereby waives any claim, right or remedy, direct or indirect, that such
Guarantor now has or may hereafter have against Borrower or any other Guarantor
or any of its assets in connection with this Guaranty or the performance by such
Guarantor of its obligations hereunder, in each case whether such claim, right
or remedy arises in equity, under contract, by statute, under common law or
otherwise and including without limitation (a) any right of subrogation,
reimbursement or indemnification that such Guarantor now has or may hereafter
have against Borrower with respect to the Guaranteed Obligations, (b) any right
to enforce, or to participate in, any claim, right or remedy that any
Beneficiary now has or may hereafter have against Borrower, and (c) any benefit
of, and any right to participate in, any collateral or security now or hereafter
held by any Beneficiary. In addition, until the Guaranteed Obligations shall
have been indefeasibly paid in full, each Guarantor shall withhold exercise of
any right of contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guaranteed Obligations, including,
without limitation, any such right of contribution as contemplated by Section
7.2. Each Guarantor further agrees that, to the extent the waiver or agreement
to withhold the exercise of
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its rights of subrogation, reimbursement, indemnification and contribution as
set forth herein is found by a court of competent jurisdiction to be void or
voidable for any reason, any rights of subrogation, reimbursement or
indemnification such Guarantor may have against Borrower or against any
collateral or security, and any rights of contribution such Guarantor may have
against any such other guarantor, shall be junior and subordinate to any rights
any Beneficiary may have against Borrower, to all right, title and interest any
Beneficiary may have in any such collateral or security, and to any right any
Beneficiary may have against such other guarantor. If any amount shall be paid
to any Guarantor on account of any such subrogation, reimbursement,
indemnification or contribution rights at any time when all Guaranteed
Obligations shall not have been finally and indefeasibly paid in full, such
amount shall be held in trust for Administrative Agent on behalf of
Beneficiaries and shall forthwith be paid over to Administrative Agent for the
benefit of Beneficiaries to be credited and applied against the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms hereof.
7.7. SUBORDINATION OF OTHER OBLIGATIONS. Any Indebtedness of Borrower
or any Guarantor now or hereafter held by any Guarantor (the "OBLIGEE
GUARANTOR") is hereby subordinated in right of payment to the Guaranteed
Obligations, and any such indebtedness collected or received by the Obligee
Guarantor after an Event of Default has occurred and is continuing shall be held
in trust for Administrative Agent on behalf of Beneficiaries and shall forthwith
be paid over to Administrative Agent for the benefit of Beneficiaries to be
credited and applied against the Guaranteed Obligations but without affecting,
impairing or limiting in any manner the liability of the Obligee Guarantor under
any other provision hereof.
7.8. CONTINUING GUARANTY. This Guaranty is a continuing guaranty and
shall remain in effect until all of the Guaranteed Obligations shall have been
paid in full. Each Guarantor hereby irrevocably waives any right to revoke this
Guaranty as to future transactions giving rise to any Guaranteed Obligations.
7.9. AUTHORITY OF GUARANTORS OR BORROWER. It is not necessary for any
Beneficiary to inquire into the capacity or powers of any Guarantor or Borrower
or the officers, directors or any agents acting or purporting to act on behalf
of any of them.
7.10. FINANCIAL CONDITION OF BORROWER AND GUARANTORS. Any Credit
Extension may be made to Borrower or continued from time to time, and any Hedge
Agreements may be entered into from time to time, in each case without notice to
or authorization from any Guarantor regardless of the financial or other
condition of Borrower or any other Guarantor at the time of any such grant or
continuation or at the time such Hedge Agreement is entered into, as the case
may be. No Beneficiary shall have any obligation to disclose or discuss with any
Guarantor its assessment, or any Guarantor's assessment, of the financial
condition of Borrower or any other Guarantor. Each Guarantor has adequate means
to obtain information from Borrower and each other Guarantor on a continuing
basis concerning the financial condition of Borrower and the other Guarantors
and their respective abilities to perform their respective obligations under the
Credit Documents and the Hedge Agreements, and each Guarantor assumes the
responsibility for being and keeping informed of the financial condition of
Borrower and the other Guarantors and of all circumstances bearing upon the risk
of nonpayment of the Guaranteed Obligations. Each Guarantor hereby waives and
relinquishes any duty on the part of any Beneficiary to disclose any
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matter, fact or thing relating to the business, operations or conditions of
Borrower and any other Guarantor now known or hereafter known by any
Beneficiary.
7.11. BANKRUPTCY, ETC.(a) (a) So long as any Guaranteed Obligations
remain outstanding, no Guarantor shall, without the prior written consent of
Administrative Agent acting pursuant to the instructions of Requisite Lenders,
commence or join with any other Person in commencing any bankruptcy,
reorganization or insolvency case or proceeding of or against Borrower or any
other Guarantor. The obligations of Guarantors hereunder shall not be reduced,
limited, impaired, discharged, deferred, suspended or terminated by any case or
proceeding, voluntary or involuntary, involving the bankruptcy, insolvency,
receivership, reorganization, liquidation or arrangement of Borrower or any
other Guarantor or by any defense which Borrower or any other Guarantor may have
by reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.
(b) Each Guarantor acknowledges and agrees that any interest
on any portion of the Guaranteed Obligations which accrues after the
commencement of any case or proceeding referred to in clause (a) above (or, if
interest on any portion of the Guaranteed Obligations ceases to accrue by
operation of law by reason of the commencement of such case or proceeding, such
interest as would have accrued on such portion of the Guaranteed Obligations if
such case or proceeding had not been commenced) shall be included in the
Guaranteed Obligations because it is the intention of Guarantors and
Beneficiaries that the Guaranteed Obligations which are guaranteed by Guarantors
pursuant hereto should be determined without regard to any rule of law or order
which may relieve Borrower of any portion of such Guaranteed Obligations.
Guarantors will permit any trustee in bankruptcy, receiver, debtor in
possession, assignee for the benefit of creditors or similar person to pay
Administrative Agent, or allow the claim of Administrative Agent in respect of,
any such interest accruing after the date on which such case or proceeding is
commenced.
(c) In the event that all or any portion of the Guaranteed
Obligations are paid by Borrower, the obligations of Guarantors hereunder shall
continue and remain in full force and effect or be reinstated, as the case may
be, in the event that all or any part of such payment(s) are rescinded or
recovered directly or indirectly from any Beneficiary as a preference,
fraudulent transfer or otherwise (and whether as a result of any demand,
settlement, litigation or otherwise), and any such payments which are so
rescinded or recovered shall constitute Guaranteed Obligations for all purposes
hereunder.
7.12. DISCHARGE OF GUARANTY UPON SALE OF GUARANTOR. If all of the
Capital Stock of any Guarantor or any of its successors in interest hereunder
shall be sold or otherwise disposed of (including by merger or consolidation) to
a Person other than Holdings or any of its Subsidiaries, in accordance with the
terms and conditions hereof, the Guaranty of such Guarantor or such successor in
interest, as the case may be, hereunder shall automatically be discharged and
released without any further action by any Beneficiary or any other Person
effective as of the time of such Asset Sale.
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SECTION 8. EVENTS OF DEFAULT
8.1. EVENTS OF DEFAULT. If any one or more of the following conditions
or events shall occur:
(a) Failure to Make Payments When Due. Failure by Borrower to
pay (i) when due any installment of principal of any Loan, whether at stated
maturity, by acceleration, by notice of voluntary prepayment, by mandatory
prepayment or otherwise; or (ii) any interest on any Loan or any fee or any
other amount due hereunder within five days after the date due thereof; or
(b) Default in Other Agreements. (i) Failure of any Credit
Party or any of their respective Subsidiaries to pay when due any principal of
or interest on or any other amount payable in respect of one or more items of
Indebtedness (other than Indebtedness referred to in Section 8.1(a)) in an
individual or aggregate principal amount of $10,000,000 or more, in each case
beyond the grace period, if any, provided therefor; (ii) breach or default by
any Credit Party with respect to any other material term of (1) one or more
items of Indebtedness in the individual or aggregate principal amounts referred
to in clause (i) above or (2) any loan agreement, mortgage, indenture or other
agreement relating to such item(s) of Indebtedness, in each case beyond the
grace period, if any, provided therefor, if the effect of such breach or default
is to cause, or to permit the holder or holders of that Indebtedness (or a
trustee or agent on behalf of such holder or holders), to cause, that
Indebtedness to become or be declared due and payable (or redeemable), or to
require the prepayment, redemption, repurchase or defeasance of, or to cause
Holdings, Borrower or any of its Subsidiaries to make any offer to prepay,
redeem, repurchase or defease that Indebtedness (other than an asset sale
proceeds offer with respect to the Senior Subordinated Notes or the Refinancing
Notes to the extent otherwise permitted hereunder), prior to its stated maturity
or the stated maturity of any underlying obligation, as the case may be; or
(iii) any Event of Default (as defined in the Senior Subordinated Note
Indenture, any Refinancing Notes Indenture or the Revolving Credit Agreement or
any credit agreement or comparable document in respect of a Permitted
Refinancing of the Revolving Loans) shall occur under the Senior Subordinated
Note Indenture, any Refinancing Notes Indenture, the Revolving Credit Agreement
or any credit agreement or comparable document in respect of a Permitted
Refinancing of the Revolving Loans; or
(c) Breach of Certain Covenants. Failure of any Credit Party
to perform or comply with any term or condition contained in Section 2.4,
Section 5.2, Section 5.5 or Section 6; or
(d) Breach of Representations, etc. Any representation,
warranty, certification or other statement made or deemed made by any Credit
Party in any Credit Document or in any statement or certificate at any time
given by any Credit Party or any of its Subsidiaries in writing pursuant hereto
or thereto or in connection herewith or therewith shall be false in any material
respect as of the date made or deemed made; or
(e) Other Defaults Under Credit Documents. Any Credit Party
shall default in the performance of or compliance with any term contained herein
or any of the other Credit Documents, other than any such term referred to in
any other provision of this Section 8.1, and
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such default shall not have been remedied or waived within thirty days after the
earlier of (i) an Authorized Officer of such Credit Party becoming aware of such
default or (ii) receipt by Borrower of notice from Administrative Agent or any
Lender of such default; or
(f) Involuntary Bankruptcy; Appointment of Receiver, etc. (i)
A court of competent jurisdiction shall enter a decree or order for relief in
respect of Holdings or any of its Subsidiaries (other than an Immaterial
Subsidiary) in an involuntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect,
which decree or order is not stayed; or any other similar relief shall be
granted under any applicable federal or state law; or (ii) an involuntary case
shall be commenced against Holdings or any of its Subsidiaries (other than its
Immaterial Subsidiaries) under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect; or a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other officer having
similar powers over Holdings or any of its Subsidiaries (other than its
Immaterial Subsidiaries), or over all or a substantial part of its property,
shall have been entered; or there shall have occurred the involuntary
appointment of an interim receiver, trustee or other custodian of Holdings or
any of its Subsidiaries (other than its Immaterial Subsidiaries) for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Holdings or any of its Subsidiaries (other than its Immaterial
Subsidiaries), and any such event described in this clause (ii) shall continue
for sixty days without having been dismissed, bonded or discharged; or
(g) Voluntary Bankruptcy; Appointment of Receiver, etc.. (i)
Holdings or any of its Subsidiaries shall have an order for relief entered with
respect to it or shall commence a voluntary case under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property; or Holdings or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or (ii) Holdings or any of its
Subsidiaries shall be unable, or shall fail generally, or shall admit in writing
its inability, to pay its debts as such debts become due; or the board of
directors (or similar governing body) of Holdings or any of its Subsidiaries (or
any committee thereof) shall adopt any resolution or otherwise authorize any
action to approve any of the actions referred to herein or in Section 8.1(f); or
(h) Judgments and Attachments. Any money judgment, writ or
warrant of attachment or similar process involving in any individual case or in
the aggregate at any time an amount in excess of $10,000,000 (in either case to
the extent not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Holdings or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of sixty days (or in any event later than five days prior to the date of
any proposed sale thereunder); or
(i) Dissolution. Any order, judgment or decree shall be
entered against any Credit Party decreeing the dissolution or split up of such
Credit Party and such order shall remain undischarged or unstayed for a period
in excess of thirty days; or
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(j) Employee Benefit Plans. (i) There shall occur one or more
ERISA Events which individually or in the aggregate results in or would
reasonably be expected to result in liability of Holdings or any of its
Subsidiaries, including through any joint and several liability with any of
their respective ERISA Affiliates, in excess of $10,000,000 during the term
hereof; or (ii) there shall occur the imposition of a Lien or security interest
under Section 412(n) of the Internal Revenue Code or under ERISA.
(k) Change of Control. A Change of Control shall occur; or
(l) Guaranties, Collateral Documents and other Credit
Documents. At any time after the execution and delivery thereof, (i) the
Guaranty for any reason, other than the satisfaction in full in Cash of all
Obligations, shall cease to be in full force and effect (other than in
accordance with its terms) or shall be declared to be null and void or any
Guarantor shall repudiate its obligations thereunder, (ii) this Agreement or any
Collateral Document ceases to be in full force and effect (other than by reason
of a release of Collateral in accordance with the terms hereof or thereof or the
satisfaction in full in Cash of the Obligations in accordance with the terms
hereof) or shall be declared null and void, or Collateral Agent shall not have
or shall cease to have valid and perfected Liens in any Collateral purported to
be covered by the Collateral Documents with the priorities required by the
relevant Collateral Document, in each case for any reason other than the failure
of Collateral Agent or any Secured Party to take any action within its control,
or (iii) any Credit Party shall contest the validity or enforceability of any
Credit Document in writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any Credit Document
to which it is a party or (iv) the Loans shall cease to constitute "Designated
Senior Indebtedness" or "Designated Senior Debt" (or a comparable term
evidencing such designation) under the subordination provisions of the Senior
Subordinated Notes or the Refinancing Notes or shall be invalidated or otherwise
cease to be legal, valid and binding obligations of the parties thereto,
enforceable in accordance with their terms;
THEN, (1) upon the occurrence of any Event of Default described in Section
8.1(f) or 8.1(g), automatically, and (2) upon the occurrence and during the
continuance, of any other Event of Default, at the request of (or with the
consent of) Requisite Lenders, upon notice to Borrower by Administrative Agent,
(A) each of the following shall immediately become due and payable, in each case
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by each Credit Party: (I) the unpaid principal
amount of and accrued interest on the Loans, and (II) all other Obligations; and
(B) Administrative Agent may, subject to the Intercreditor Agreement, cause
Collateral Agent to enforce any and all Liens and security interests created
pursuant to Collateral Documents..
SECTION 9. AGENTS
9.1. APPOINTMENT OF AGENTS. GSCP is hereby appointed Syndication Agent,
Administrative Agent and Collateral Agent hereunder, and each Lender hereby
authorizes Syndication Agent, Administrative Agent and Collateral Agent to act
as its agent in accordance with the terms hereof and the other Credit Documents.
Each Agent hereby agrees to act upon the express conditions contained herein and
the other Credit Documents, as applicable. The
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provisions of this Section 9 are solely for the benefit of Agents and Lenders
and no Credit Party shall have any rights as a third party beneficiary of any of
the provisions thereof. In performing its functions and duties hereunder, each
Agent shall act solely as an agent of Lenders and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of agency or
trust with or for Holdings or any of its Subsidiaries. Syndication Agent without
consent of or notice to any party hereto, may assign any and all of its rights
or obligations hereunder to any of its Affiliates. As of the Closing Date, GSCP,
in its capacity as Syndication Agent, shall not have any obligations but shall
be entitled to all benefits of this Section 9.
9.2. POWERS AND DUTIES. Each Lender irrevocably authorizes each Agent
to take such action on such Lender's behalf and to exercise such powers, rights
and remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents. Each Agent may exercise such
powers, rights and remedies and perform such duties by or through its agents or
employees. No Agent shall have, by reason hereof or any of the other Credit
Documents, a fiduciary relationship in respect of any Lender; and nothing herein
or any of the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon any Agent any obligations in respect
hereof or any of the other Credit Documents except as expressly set forth herein
or therein.
9.3. GENERAL IMMUNITY.
(a) No Responsibility for Certain Matters. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectability or sufficiency hereof or any other
Credit Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by any Agent to Lenders or by or on behalf of any
Credit Party, any Lender or any person providing the Settlement Service to any
Agent or any Lender in connection with the Credit Documents and the transactions
contemplated thereby or for the financial condition or business affairs of any
Credit Party or any other Person liable for the payment of any Obligations, nor
shall any Agent be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained in any of the Credit Documents or as to the use of the proceeds of the
Loans or as to the existence or possible existence of any Event of Default or
Default or to make any disclosures with respect to the foregoing. Anything
contained herein to the contrary notwithstanding, Administrative Agent shall not
have any liability arising from confirmations of the amount of outstanding
Loans.
(b) Exculpatory Provisions. No Agent nor any of its officers,
partners, directors, employees or agents shall be liable to Lenders for any
action taken or omitted by any Agent under or in connection with any of the
Credit Documents except to the extent caused by such Agent's gross negligence or
willful misconduct. Each Agent shall be entitled to refrain from any act or the
taking of any action (including the failure to take an action) in connection
herewith or any of the other Credit Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required
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to give such instructions under Section 10.5) and, upon receipt of such
instructions from Requisite Lenders (or such other Lenders, as the case may be),
such Agent shall be entitled to act or (where so instructed) refrain from
acting, or to exercise such power, discretion or authority, in accordance with
such instructions. Without prejudice to the generality of the foregoing, (i)
each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper Person or Persons,
including any Settlement Confirmation or other communication issued by any
Settlement Service and shall be entitled to rely and shall be protected in
relying on opinions and judgments of attorneys (who may be attorneys for
Holdings and its Subsidiaries), accountants, experts and other professional
advisors selected by it; and (ii) no Lender shall have any right of action
whatsoever against any Agent as a result of such Agent acting or (where so
instructed) refraining from acting hereunder or any of the other Credit
Documents in accordance with the instructions of Requisite Lenders (or such
other Lenders as may be required to give such instructions under Section 10.5).
(c) Delegation of Duties. Administrative Agent may perform any
and all of its duties and exercise its rights and powers under this Agreement or
under any other Credit Document by or through any one or more sub-agents
appointed by Administrative Agent. Administrative Agent and any such sub-agent
may perform any and all of its duties and exercise its rights and powers by or
through their respective Affiliates. The exculpatory, indemnification and other
provisions of this Section 9.3 and of Section 9.6 shall apply to any the
Affiliates of Administrative Agent and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent. All of the rights,
benefits, and privileges (including the exculpatory and indemnification
provisions) of this Section 9.3 and of Section 9.6 shall apply to any such
sub-agent and to the Affiliates of any such sub-agent, and shall apply to their
respective activities as sub-agent as if such sub-agent and Affiliates were
named herein. Notwithstanding anything herein to the contrary, with respect to
each sub-agent appointed by the Administrative Agent, (i) such sub-agent shall
be a third party beneficiary under this Agreement with respect to all such
rights, benefits and privileges (including exculpatory rights and rights to
indemnification) and shall have all of the rights and benefits of a third party
beneficiary, including an independent right of action to enforce such rights,
benefits and privileges (including exculpatory rights and rights to
indemnification) directly, without the consent or joinder of any other Person,
against any or all of the Credit Parties and the Lenders, (ii) such rights,
benefits and privileges (including exculpatory rights and rights to
indemnification) shall not be modified or amended without the consent of such
sub-agent, and (iii) such sub-agent shall only have obligations to
Administrative Agent and not to any Credit Party, Lender or any other Person and
no Credit Party, Lender or any other Person shall have any rights, directly or
indirectly, as a third party beneficiary or otherwise, against such sub-agent.
9.4. AGENTS ENTITLED TO ACT AS LENDER. The agency hereby created shall
in no way impair or affect any of the rights and powers of, or impose any duties
or obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans, each Agent shall have the same
rights and powers hereunder as any other Lender and may exercise the same as if
it were not performing the duties and functions delegated to it hereunder, and
the term "Lender" shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity. Any Agent and its Affiliates may accept
deposits from, lend money to,
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own securities of, and generally engage in any kind of banking, lending, trust,
financial advisory or other business with Holdings or any of its Affiliates as
if it were not performing the duties specified herein, and may accept fees and
other consideration from Borrower for services in connection herewith and
otherwise without having to account for the same to Lenders.
9.5. LENDERS' REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENT.
(a) Each Lender represents and warrants that it has made its
own independent investigation of the financial condition and affairs of Holdings
and its Subsidiaries in connection with Credit Extensions hereunder and that it
has made and shall continue to make its own appraisal of the creditworthiness of
Holdings and its Subsidiaries. No Agent shall have any duty or responsibility,
either initially or on a continuing basis, to make any such investigation or any
such appraisal on behalf of Lenders or to provide any Lender with any credit or
other information with respect thereto, whether coming into its possession
before the making of the Loans or at any time or times thereafter, and no Agent
shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
(b) Each Lender, by delivering its signature page to this
Agreement on the Closing Date, shall be deemed to have acknowledged receipt of,
and consented to and approved, each Credit Document and each other document
required to be approved by any Agent, Requisite Lenders or Lenders, as
applicable on the Closing Date. Notwithstanding anything herein to the contrary,
each Lender also acknowledges that the lien and the security interest granted to
the Collateral Agent for the benefit of the Term Secured Parties pursuant to the
Term Pledge and Security Agreement and the exercise of any right or remedy by
the Collateral Agent thereunder are subject to the provisions of the
Intercreditor Agreement.
9.6. RIGHT TO INDEMNITY. Each Lender, in proportion to its Pro Rata
Share, severally agrees to indemnify each Agent, to the extent that such Agent
shall not have been reimbursed by any Credit Party, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements) or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by or asserted
against such Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Credit Documents or otherwise in its
capacity as such Agent in any way relating to or arising out of this Agreement
or the other Credit Documents; provided, no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such Agent's
gross negligence or willful misconduct. If any indemnity furnished to any Agent
for any purpose shall, in the opinion of such Agent, be insufficient or become
impaired, such Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished; provided, in no event shall this sentence require any Lender to
indemnify any Agent against any liability, obligation, loss, damage, penalty,
action, judgment, suit, cost, expense or disbursement in excess of such Lender's
Pro Rata Share thereof; and provided further, this sentence shall not be deemed
to require any Lender to indemnify any Agent against any liability, obligation,
loss, damage, penalty, action, judgment, suit, cost, expense or disbursement
described in the proviso in the immediately preceding sentence.
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9.7. SUCCESSOR ADMINISTRATIVE AGENT AND COLLATERAL AGENT.
Administrative Agent may resign at any time by giving thirty days' prior written
notice thereof to Lenders and Borrower, and Administrative Agent may be removed
at any time with or without cause by an instrument or concurrent instruments in
writing delivered to Borrower and Administrative Agent and signed by Requisite
Lenders. Upon any such notice of resignation or any such removal, Requisite
Lenders shall have the right, upon five Business Days' notice to Borrower, to
appoint a successor Administrative Agent. Upon the acceptance of any appointment
as Administrative Agent hereunder by a successor Administrative Agent, that
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring or removed
Administrative Agent and the retiring or removed Administrative Agent shall
promptly (i) transfer to such successor Administrative Agent all records and
other documents necessary or appropriate in connection with the performance of
the duties of the successor Administrative Agent under the Credit Documents, and
(ii) take such other actions as may be necessary or appropriate in connection
with the assignment to such successor Administrative Agent, whereupon such
retiring or removed Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent hereunder. Any resignation or
removal of Administrative Agent pursuant to this Section shall also constitute
the resignation or removal of GSCP or its successor as Collateral Agent, and any
successor Administrative Agent appointed pursuant to this Section shall, upon
its acceptance of such appointment, become the successor Collateral Agent for
all purposes hereunder and under the Credit Documents and such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Collateral
Agent under this Agreement and the other Credit Documents, and the retiring or
removed Collateral Agent under this Agreement and the other Credit Documents
shall promptly (i) transfer to such successor Collateral Agent all sums,
Securities and other items of Collateral held under this Agreement or the other
Credit Documents, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Collateral Agent under this Agreement or the other Credit Documents, and (ii)
execute and deliver to such successor Collateral Agent or otherwise authorize
the filing of such amendments to financing statements, and take such other
actions, as may be necessary or appropriate in connection with the assignment to
such successor Collateral Agent of the security interests created under the
Credit Documents, whereupon such retiring or removed Collateral Agent shall be
discharged from its duties and obligations under this Agreement and other Credit
Documents. After any retiring or removed Collateral Agent's resignation or
removal under this Agreement and other Credit Documents, the provisions of this
Section 9 and the other Credit Documents shall inure to its benefit as to any
actions taken or omitted to be taken by it under this Agreement or the other
Credit Documents while it was the Collateral Agent hereunder or thereunder.
9.8. COLLATERAL DOCUMENTS AND GUARANTY.
(a) Agents under Collateral Documents and Guaranty. Each
Lender hereby further authorizes Administrative Agent or Collateral Agent, as
applicable, on behalf of and for the benefit of Lenders, to be the agent for and
representative of Lenders with respect to the Guaranty, the Collateral and the
Collateral Documents. Subject to Section 10.5, without further
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written consent or authorization from Lenders, Administrative Agent or
Collateral Agent, as applicable, may execute any documents or instruments
necessary to (i) release any Lien for the benefit of the Term Secured Parties
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets to a Person other than Holdings or any of its Subsidiaries
permitted hereby or to which Requisite Lenders (or such other Lenders as may be
required to give such consent under Section 10.5) have otherwise consented or
(ii) release any Guarantor from the Guaranty pursuant to Section 7.12 or with
respect to which Requisite Lenders (or such other Lenders as may be required to
give such consent under Section 10.5) have otherwise consented.
(b) Right to Realize on Collateral and Enforce Guaranty.
Anything contained in any of the Credit Documents to the contrary
notwithstanding, Borrower, Administrative Agent, Collateral Agent and each
Lender hereby agree that (i) no Lender shall have any right individually to
realize upon any of the Collateral or to enforce the Guaranty, it being
understood and agreed that all powers, rights and remedies hereunder and under
the Collateral Documents may be exercised solely by Administrative Agent or
Collateral Agent, as applicable, on behalf of Lenders or Term Secured Parties,
as applicable, in accordance with the terms of this Agreement and the Collateral
Documents, and (ii) in the event of a foreclosure by Collateral Agent on any of
the Collateral pursuant to a public or private sale, Collateral Agent or any
Lender may be the purchaser of any or all of such Collateral at any such sale
and Collateral Agent, as agent for and representative of Secured Parties (but
not any Lender or Lenders in its or their respective individual capacities
unless Requisite Lenders shall otherwise agree in writing) shall be entitled,
for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Collateral sold at any such public sale, to
use and apply any of the Obligations as a credit on account of the purchase
price for any collateral payable by Collateral Agent at such sale.
SECTION 10. MISCELLANEOUS
10.1. NOTICES. Unless otherwise specifically provided herein, any
notice or other communication herein required or permitted to be given to a
Credit Party, Syndication Agent, Collateral Agent or Administrative Agent, shall
be sent to such Person's address as set forth on Appendix B or in the other
relevant Credit Document, and in the case of any Lender, the address as
indicated on Appendix B or otherwise indicated to Administrative Agent in
writing. Each notice hereunder shall be in writing and may be personally served,
telexed or sent by telefacsimile or United States mail or courier service and
shall be deemed to have been given when delivered in person or by courier
service and signed for against receipt thereof, upon receipt of telefacsimile or
telex, or three Business Days after depositing it in the United States mail with
postage prepaid and properly addressed; provided, no notice to any Agent shall
be effective until received by such Agent; provided, further, that any such
notice or other communication shall at the request of the Administrative Agent
be provided to any sub-agent appointed pursuant to Section 9.3(c) by the
Administrative Agent from time to time.
10.2. EXPENSES. Whether or not the transactions contemplated hereby
shall be consummated, Borrower agrees to pay promptly (a) all the actual and
reasonable costs and expenses of preparation of the Credit Documents and any
consents, amendments, waivers or
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other modifications thereto; (b) all the reasonable costs of furnishing all
opinions by counsel for Borrower and the other Credit Parties; (c) the
reasonable fees, expenses and disbursements of counsel to Agents in connection
with the negotiation, preparation, execution and administration of the Credit
Documents and any consents, amendments, waivers or other modifications thereto
and any other documents or matters requested by Borrower; (d) all the actual
costs and reasonable expenses of creating and perfecting Liens in favor of
Collateral Agent, for the benefit of Term Secured Parties, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums and reasonable fees, expenses and disbursements of
counsel to each Agent and of counsel providing any opinions that any Agent or
Requisite Lenders may request in respect of the Collateral or the Liens created
pursuant to the Collateral Documents; (e) all the actual costs and reasonable
fees, expenses and disbursements of any auditors, accountants, consultants or
appraisers (but in no event for more than one commercial audit and one appraisal
per Fiscal Year except after the occurrence of and during the continuance of a
Default or Event of Default, which right to payment is exclusive of the similar
rights to payment under the Revolving Credit Agreement); (f) all the actual
costs and reasonable expenses (including the reasonable fees, expenses and
disbursements of any appraisers, consultants, advisors and agents employed or
retained by Collateral Agent and its counsel) in connection with the custody or
preservation of any of the Collateral; (g) all other actual and reasonable costs
and expenses incurred by each Agent in connection with the syndication of the
Loans and Commitments and the negotiation, preparation and execution of the
Credit Documents and any consents, amendments, waivers or other modifications
thereto and the transactions contemplated thereby; and (h) after the occurrence
of a Default or an Event of Default, all actual and reasonable (such
reasonableness determined in the sole discretion of the Administrative Agent)
costs and reasonable (such reasonableness determined in the sole discretion of
the Administrative Agent) expenses, including attorneys' fees and costs of
settlement, incurred by any Agent and Lenders in enforcing any Obligations of or
in collecting any payments due from any Credit Party hereunder or under the
other Credit Documents by reason of such Default or Event of Default (including
in connection with the sale of, collection from, or other realization upon any
of the Collateral or the enforcement of the Guaranty) or in connection with any
refinancing or restructuring of the credit arrangements provided hereunder in
the nature of a "work-out" or pursuant to any insolvency or bankruptcy cases or
proceedings; provided that Borrower shall not be required to pay the fees and
expenses of more than one counsel for Lenders other than the Administrative
Agent (who shall be entitled to be paid the fees and expenses of its counsel
notwithstanding the foregoing).
10.3. INDEMNITY.
(a) In addition to the payment of expenses pursuant to Section
10.2, whether or not the transactions contemplated hereby shall be consummated,
each Credit Party agrees to defend (subject to Indemnitees' selection of
counsel), indemnify, pay and hold harmless, each Agent and Lender and the
officers, partners, directors, trustees, employees, agents, sub-agents, advisors
and Affiliates of each Agent and each Lender (each, an "INDEMNITEE"), from and
against any and all Indemnified Liabilities; provided, no Credit Party shall
have any obligation to any Indemnitee hereunder with respect to any Indemnified
Liabilities to the extent such Indemnified Liabilities arise from the gross
negligence or willful misconduct of such Indemnitee. To the extent that the
undertakings to defend, indemnify, pay and hold harmless set forth in this
Section 10.3 may be unenforceable in whole or in part because they are violative
of any law or
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public policy, the applicable Credit Party shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.
(b) To the extent permitted by applicable law, no Credit Party
shall assert, and each Credit Party hereby waives, any claim against Lenders,
Agents and their respective Affiliates, directors, employees, attorneys, agents,
sub-agents or advisors, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
(whether or not the claim therefor is based on contract, tort or duty imposed by
any applicable legal requirement) arising out of, in connection with, arising
out of, as a result of, or in any way related to, this Agreement or any Credit
Document or any agreement or instrument contemplated hereby or thereby or
referred to herein or therein, the transactions contemplated hereby or thereby,
any Loan or the use of the proceeds thereof or any act or omission or event
occurring in connection therewith, and Holdings and Borrower hereby waives,
releases and agrees not to xxx upon any such claim or any such damages, whether
or not accrued and whether or not known or suspected to exist in its favor.
10.4. SET-OFF. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Lender is hereby authorized by each
Credit Party at any time or from time to time subject to the consent of
Administrative Agent (such consent not to be unreasonably withheld or delayed),
without notice to any Credit Party or to any other Person (other than
Administrative Agent), any such notice being hereby expressly waived, to set off
and to appropriate and to apply any and all deposits (general or special,
including Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including trust accounts) and any other Indebtedness at any
time held or owing by such Lender to or for the credit or the account of any
Credit Party against and on account of the obligations and liabilities of any
Credit Party to such Lender hereunder and under the other Credit Documents,
including all claims of any nature or description arising out of or connected
hereto or with any other Credit Document, irrespective of whether or not (a)
such Lender shall have made any demand hereunder or (b) the principal of or the
interest on the Loans or any other amounts due hereunder shall have become due
and payable pursuant to Section 2 and although such obligations and liabilities,
or any of them, may be contingent or unmatured.
10.5. AMENDMENTS AND WAIVERS.
(a) Requisite Lenders' Consent. Subject to Section 10.5(b) and
10.5(c), no amendment, modification, termination or waiver of any provision of
the Credit Documents, or consent to any departure by any Credit Party therefrom,
shall in any event be effective without the written concurrence of the Requisite
Lenders.
(b) Affected Lenders' Consent. Without the written consent of
each Lender that would be directly affected thereby, no amendment, modification,
termination, or consent shall be effective if the effect thereof would:
(i) extend the scheduled final maturity of
any Loan or Note;
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(ii) waive, reduce or postpone any scheduled
repayment (but not prepayment);
(iii) reduce the rate of interest on any
Loan (other than any waiver of any increase in the interest rate
applicable to any Loan pursuant to Section 2.6) or any fee payable
hereunder or any other amount payable under any Credit Document or
waive, amend or reduce any prepayment premium;
(iv) reduce or forgive the amount due and
payable or extend the time for payment of any such interest, fees or
prepayment premium;
(v) reduce the principal amount of any Loan;
(vi) amend, modify, terminate or waive any
provision of this Section 10.5(b) or Section 10.5(c);
(vii) amend any provision of Section 2.14 or
amend the definition of "REQUISITE LENDERS" or "PRO RATA SHARE";
(viii) release all or substantially all of
the Fixed Collateral, the Liquid Collateral or any of the Guarantors
from the Guaranty except as expressly provided in the Credit Documents;
or
(ix) consent to the assignment or transfer
by any Credit Party of any of its rights and obligations under any
Credit Document.
(c) Other Consents. No amendment, modification, termination or
waiver of any provision of the Credit Documents, or consent to any departure by
any Credit Party therefrom, shall amend, modify, terminate or waive any
provision of Section 9 as the same applies to any Agent, or any other provision
hereof as the same applies to the rights or obligations of any Agent, in each
case without the consent of such Agent.
(d) Execution of Amendments, etc. Administrative Agent may,
but shall have no obligation to, with the concurrence of any Lender, execute
amendments, modifications, waivers or consents on behalf of such Lender. Any
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given. No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or further notice
or demand in similar or other circumstances. Any amendment, modification,
termination, waiver or consent effected in accordance with this Section 10.5
shall be binding upon each Lender at the time outstanding, each future Lender
and, if signed by a Credit Party, on such Credit Party.
10.6. SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) Generally. This Agreement shall be binding upon the
parties hereto and their respective successors and assigns and shall inure to
the benefit of the parties hereto and the successors and assigns of Lenders. No
Credit Party's rights or obligations hereunder nor any interest therein may be
assigned or delegated by any Credit Party without the prior written consent of
all Lenders. Nothing in this Agreement, expressed or implied, shall be construed
to
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confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, Affiliates of each of the Agents and Lenders and
Indemnitees) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Register. Borrower, Administrative Agent and Lenders shall
deem and treat the Persons listed as Lenders in the Register as the holders and
owners of the corresponding Commitments and Loans listed therein for all
purposes hereof, and no assignment or transfer of any such Loan shall be
effective, in each case, unless and until recorded in the Register following
receipt of (x) a written or electronic confirmation of an assignment issued by a
Settlement Service pursuant to Section 10.6(d) (a "SETTLEMENT CONFIRMATION") or
(y) an Assignment Agreement effecting the assignment or transfer thereof, in
each case, as provided in Section 10.6(d). Each assignment shall be recorded in
the Register on the Business Day the Settlement Confirmation is received by the
Administrative Agent, if received by 12:00 noon New York City time (and on the
following Business Day if received after such time) prompt notice thereof shall
be delivered to Borrower and a copy of such Assignment Agreement or Settlement
Confirmation shall be maintained by Administrative Agent, as applicable. The
date of such recordation of a transfer shall be referred to herein as the
"ASSIGNMENT EFFECTIVE DATE." Any request, authority or consent of any Person
who, at the time of making such request or giving such authority or consent, is
listed in the Register as a Lender shall be conclusive and binding on any
subsequent holder, assignee or transferee of the corresponding Loans.
(c) Right to Assign. Each Lender shall have the right at any
time to sell, assign or transfer all or a portion of its rights and obligations
under this Agreement, including, without limitation, all or a portion of its
Loans owing to it or other Obligation (provided, however, that each such
assignment shall be of a uniform, and not varying, percentage of all rights and
obligations under and in respect of any Loan), to any Person meeting the
criteria of the definition of the term of "Eligible Assignee"; provided that
each such assignment pursuant to this Section 10.6(c) shall be in an aggregate
amount of not less than $1,000,000 (or such lesser amount as may be agreed to by
Borrower and Administrative Agent or as shall constitute the aggregate amount of
the Term Loans of the assigning Lender) with respect to the assignment of the
Term Loans.
(d) Mechanics. Assignments of Term Loans by Lenders may be
made via an electronic settlement system acceptable to Administrative Agent as
designated in writing from time to time to the Lenders by Administrative Agent
(the "SETTLEMENT SERVICE"). Each such assignment shall be effected by the
assigning Lender and proposed assignee pursuant to the procedures then in effect
under the Settlement Service, which procedures shall be consistent with the
other provisions of this Section 10.6. Each assignor Lender and proposed
assignee shall comply with the requirements of the Settlement Service in
connection with effecting any transfer of Loans pursuant to the Settlement
Service. Subject to the other requirements of this Section 10.6, assignments and
assumptions of Term Loans may also be effected by manual execution and delivery
to the Administrative Agent of an Assignment Agreement. Initially, assignments
and assumptions of Term Loans shall be effected by such manual execution until
Administrative Agent notifies Lenders to the contrary. Assignments made pursuant
to the foregoing provision shall be effective as of the Assignment Effective
Date. In connection with all assignments there shall be delivered to
Administrative Agent such forms, certificates or other evidence, if any, with
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respect to United States federal income tax withholding matters as the assignee
under such Assignment Agreement may be required to deliver pursuant to Section
2.18(c). Notwithstanding anything herein or in any Assignment Agreement to the
contrary and (i) unless notice to the contrary is delivered to the Lenders from
the Administrative Agent or (ii) so long as no Default or Event of Default has
occurred and is continuing, payment to the assignor by the assignee in respect
of the settlement of an assignment of any Term Loan shall include such
compensation to the assignor as may be agreed upon by the assignor and the
assignee with respect to all unpaid interest which has accrued on such Term Loan
to but excluding the Assignment Effective Date. On and after the applicable
Assignment Effective Date, the applicable assignee shall be entitled to receive
all interest paid or payable with respect to the assigned Term Loan, whether
such interest accrued before or after the applicable Assignment Effective Date.
(e) Notice of Assignment. With respect to any assignments or
assumptions of Term Loans which are effected by manual execution as provided in
clause (d) above, upon its receipt of a duly executed and completed Assignment
Agreement (and any forms, certificates or other evidence required by this
Agreement in connection therewith), Administrative Agent shall record the
information contained in such Assignment Agreement in the Register, shall give
prompt notice thereof to Borrower and shall maintain a copy of such Assignment
Agreement.
(f) Representations and Warranties of Assignee. Each Lender,
upon execution and delivery hereof or upon succeeding to an interest in the
Loans, represents and warrants as of the Closing Date or as of the Assignment
Effective Date that (i) it is an Eligible Assignee; (ii) it has experience and
expertise in the making of or investing in loans such as the applicable Loans;
and (iii) it will make or invest in, as the case may be, its Loans for its own
account in the ordinary course of its business and without a view to
distribution of such Loans within the meaning of the Securities Act or the
Exchange Act or other federal securities laws (it being understood that, subject
to the provisions of this Section 10.6, the disposition of such Loans or any
interests therein shall at all times remain within its exclusive control).
(g) Effect of Assignment. Subject to the terms and conditions
of this Section 10.6, as of the Assignment Effective Date: (i) the assignee
thereunder shall have the rights and obligations of a "Lender" hereunder to the
extent of its interests in the Loans as reflected in the Register and shall
thereafter be a party hereto and a "Lender" for all purposes hereof; (ii) the
assigning Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned to the assignee, relinquish its rights (other than
any rights which survive the termination hereof under Section 10.8) and be
released from its obligations hereunder (and, in the case of an assignment
covering all or the remaining portion of an assigning Lender's rights and
obligations hereunder, such Lender shall cease to be a party hereto on the
Assignment Effective Date; provided, anything contained in any of the Credit
Documents to the contrary notwithstanding, such assigning Lender shall continue
to be entitled to the benefit of all indemnities hereunder as specified herein
with respect to matters arising out of the prior involvement of such assigning
Lender as a Lender hereunder); and (iii) if any such assignment occurs after the
issuance of any Note hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes to Administrative Agent for cancellation, and
thereupon Borrower shall issue and deliver new Notes, if so requested by the
assignee and/or assigning Lender, to such assignee and/or to
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such assigning Lender, with appropriate insertions, to reflect the outstanding
Loans of the assignee and/or the assigning Lender.
(h) Participations. Each Lender shall have the right at any
time to sell one or more participations to any Person (other than Holdings, any
of its Subsidiaries or any of its Affiliates) in all or any part of its Loans or
in any other Obligation. The holder of any such participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except with
respect to any amendment, modification or waiver that would (i) extend the final
scheduled maturity of any Loan or Note 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 rates) or reduce the principal amount thereof,
or increase the amount of the participant's participation over the amount
thereof then in effect (it being understood that a waiver of any Default or
Event of Default shall not constitute a change in the terms of such
participation, and that an increase in any Loan shall be permitted without the
consent of any participant if the participant's participation is not increased
as a result thereof), (ii) consent to the assignment or transfer by any Credit
Party of any of its rights and obligations under this Agreement or (iii) release
all or substantially all of the Collateral under the Collateral Documents
(except as expressly provided in the Credit Documents) supporting the Loans
hereunder in which such participant is participating. Borrower agrees that each
participant shall be entitled to the benefits of Sections 2.15(c), 2.16 and 2.17
to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (c) of this Section; provided, (i) a
participant shall not be entitled to receive any greater payment under Section
2.16 or 2.17 than the applicable Lender would have been entitled to receive with
respect to the participation sold to such participant, unless the sale of the
participation to such participant is made with Borrower's prior written consent
and (ii) a participant that would be a Non-US Lender if it were a Lender shall
not be entitled to the benefits of Section 2.17 unless Borrower is notified of
the participation sold to such participant and such participant agrees, for the
benefit of Borrower, to comply with Section 2.17 as though it were a Lender. To
the extent permitted by law, each participant also shall be entitled to the
benefits of Section 10.4 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.14 as though it were a Lender.
Certain Other Assignments. In addition to any other assignment
permitted pursuant to this Section 10.6, (i) any Lender may assign and/or pledge
all or any portion of its Loans, the other Obligations owned by or owed by or to
such Lender, and its Notes, if any, to secure obligations of such Lender
including, without limitation, to any Federal Reserve Bank as collateral
security pursuant to Regulation A of the Board of Governors of the Federal
Reserve System and any operating circular issued by such Federal Reserve Bank
and (ii) any Lender may assign and/or pledge all or any portion of its Loans,
the other Obligations owned by or owed to such Lender, and its Notes, if any, to
secure obligations of such Lender to any holders of obligations owed, or
securities issued, by such Lender as collateral security for such obligations or
securities, or to any trustee for, or any other representative of such holders;
provided, no Lender, as between Borrower and such Lender, shall be relieved of
any of its obligations hereunder as a result of any such assignment and pledge,
and provided, further, in no event shall the applicable Federal Reserve Bank,
pledgee or trustee be considered to be a "Lender" or be entitled to require the
assigning Lender to take or omit to take any action hereunder.
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10.7. INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is taken
or condition exists.
10.8. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension.
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.15(c), 2.16, 2.17, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in Sections 2.14, 9.3(b)
and 9.6 shall survive the payment of the Loans and the termination hereof.
10.9. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part
of any Agent or any Lender in the exercise of any power, right or privilege
hereunder or under any other Credit Document shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other power, right or
privilege. The rights, powers and remedies given to each Agent and each Lender
hereby are cumulative and shall be in addition to and independent of all rights,
powers and remedies existing by virtue of any statute or rule of law or in any
of the other Credit Documents or any of the Hedge Agreements. Any forbearance or
failure to exercise, and any delay in exercising, any right, power or remedy
hereunder shall not impair any such right, power or remedy or be construed to be
a waiver thereof, nor shall it preclude the further exercise of any such right,
power or remedy.
10.10. MARSHALLING; PAYMENTS SET ASIDE. Neither any Agent nor any
Lender shall be under any obligation to marshal any assets in favor of any
Credit Party or any other Person or against or in payment of any or all of the
Obligations. To the extent that any Credit Party makes a payment or payments to
Administrative Agent or Lenders (or to Administrative Agent, on behalf of
Lenders), or Administrative Agent or Secured Parties enforce any security
interests or exercise their rights of setoff, and such payment or payments or
the proceeds of such enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, any other state or federal law, common law or any equitable
cause or otherwise (and whether as a result of any demand, settlement,
litigation or otherwise), then, to the extent of such recovery, the obligation
or part thereof originally intended to be satisfied, and all Liens, rights and
remedies therefor or related thereto, shall be revived and continued in full
force and effect as if such payment or payments had not been made or such
enforcement or setoff had not occurred.
10.11. SEVERABILITY. In case any provision in or obligation hereunder
or under any Note shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
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10.12. OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS. The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations of any other Lender hereunder. Nothing contained herein or
in any other Credit Document, and no action taken by Lenders pursuant hereto or
thereto, shall be deemed to constitute Lenders as a partnership, an association,
a joint venture or any other kind of entity. The amounts payable at any time
hereunder to each Lender shall be a separate and independent debt, and each
Lender shall be entitled to protect and enforce its rights arising out herefrom
and it shall not be necessary for any other Lender to be joined as an additional
party in any proceeding for such purpose.
10.13. HEADINGS. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.
10.14. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING NEW YORK
GENERAL OBLIGATIONS LAW SECTION 5-1401) WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES THEREOF OTHER THAN SUCH SECTION 5-1401.
10.15. CONSENT TO JURISDICTION. ALL JUDICIAL PROCEEDINGS BROUGHT
AGAINST ANY CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT
DOCUMENT, OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL
COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY
EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (a) accepts GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (b)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (c) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS
ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1; (d) AGREES THAT SERVICE AS
PROVIDED IN CLAUSE (c) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER
THE APPLICABLE CREDIT PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND
OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (e)
AGREES AGENTS AND LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS
OF ANY OTHER JURISDICTION.
10.16. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES
TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR
ANY DEALINGS
106
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR TO ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
10.17. CONFIDENTIALITY. Each Lender shall hold all non-public
information regarding Borrower and its Subsidiaries and their businesses
identified as such by Borrower and obtained by such Lender pursuant to the
requirements hereof in accordance with customary procedures for handling
confidential information of such nature, it being understood and agreed by
Borrower that, in any event, a Lender may make (i) disclosures of such
information to Affiliates of such Lender and to such Lender's and such Lender's
Affiliates' directors, officers, employees, agents and advisors (and to other
persons authorized by a Lender or Agent to organize, present or disseminate such
information in connection with disclosures otherwise made in accordance with
this Section 10.17), (ii) disclosures of such information reasonably required by
any bona fide or potential assignee, transferee or participant in connection
with the contemplated assignment, transfer or participation by such Lender of
any Loans or any participations therein or by any direct or indirect contractual
counterparties (or the professional advisors thereto) in Hedge Agreements
(provided, such counterparties and advisors are advised of and agree to be bound
by the provisions of this Section 10.17), (iii) disclosure to any rating agency
when required by it, provided that, prior to any disclosure, such rating agency
shall undertake in writing to preserve the confidentiality of any confidential
information relating to the Credit Parties received by it from any of the Agents
or any Lender, and (iv) disclosures required or requested by any governmental
agency or representative thereof or by the NAIC or pursuant to legal or judicial
process; provided, unless specifically prohibited by applicable law or court
order, each Lender shall make reasonable efforts to notify Borrower of any
request by any governmental agency or representative thereof (other than any
such request in connection with any examination of the
107
financial condition or other routine examination of such Lender by such
governmental agency) for disclosure of any such non-public information prior to
disclosure of such information.
10.18. USURY SAVINGS CLAUSE. Notwithstanding any other provision
herein, the aggregate interest rate charged with respect to any of the
Obligations, including all charges or fees in connection therewith deemed in the
nature of interest under applicable law shall not exceed the Highest Lawful
Rate. If the rate of interest (determined without regard to the preceding
sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the
outstanding amount of the Loans made hereunder shall bear interest at the
Highest Lawful Rate until the total amount of interest due hereunder equals the
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect. In
addition, if when the Loans made hereunder are repaid in full the total interest
due hereunder (taking into account the increase provided for above) is less than
the total amount of interest which would have been due hereunder if the stated
rates of interest set forth in this Agreement had at all times been in effect,
then to the extent permitted by law, Borrower shall pay to Administrative Agent
an amount equal to the difference between the amount of interest paid and the
amount of interest which would have been paid if the Highest Lawful Rate had at
all times been in effect. Notwithstanding the foregoing, it is the intention of
Lenders and Borrower to conform strictly to any applicable usury laws.
Accordingly, if any Lender contracts for, charges, or receives any consideration
which constitutes interest in excess of the Highest Lawful Rate, then any such
excess shall be cancelled automatically and, if previously paid, shall at such
Lender's option be applied to the outstanding amount of the Loans made hereunder
or be refunded to Borrower.
10.19. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.
10.20. EFFECTIVENESS. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and receipt by
Borrower and Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.
10.21. USA PATRIOT ACT. Each Lender hereby notifies Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)), it is required to obtain, verify and record
information that identifies Borrower, which information includes the name and
address of Borrower and other information that will allow such Lender to
identify Borrower in accordance with such Act.
10.22. ELECTRONIC EXECUTION OF ASSIGNMENTS. The words "execution,"
"signed," "signature," and words of like import in any Assignment Agreement
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce
108
Act, the New York State Electronic Signatures and Records Act, or any other
similar state laws based on the Uniform Electronic Transactions Act.
[Remainder of page intentionally left blank]
109
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
STANADYNE CORPORATION
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Executive
Officer
STANADYNE AUTOMOTIVE HOLDING CORP.
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Executive
Officer
PRECISION ENGINE PRODUCTS CORP.
By: /s/ XXXXXXX X. XXXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Executive
Officer
S-1
XXXXXXX XXXXX CREDIT PARTNERS L.P.,
as Sole Lead Arranger, Sole Bookrunner,
Syndication Agent, Administrative Agent,
Collateral Agent and a Lender
By: /s/ XXXXXX XXXXXX
----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Authorized Signatory
S-2
THE CIT GROUP/BUSINESS CREDIT, INC.,
as a Lender
By: /s/ XXXXX X. XXXXXXX, XX.
----------------------------------------
Name: Xxxxx X. Xxxxxxx, Xx.
Title: Vice President
S-3
ANTARES CAPITAL CORPORATION, as a Lender
By: /s/ XXXXX X. XXXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Managing Director
S-4
LASALLE BANK NATIONAL ASSOCIATION, as a
Lender
By: /s/ XXXX XXXXXXXX
----------------------------------------
Name: Xxxx Xxxxxxxx
Title: First Vice President
S-5
APPENDIX A
TO CREDIT AND GUARANTY AGREEMENT
COMMITMENTS
LENDER COMMITMENT PRO RATA SHARE
---------------------------------------------------------------------------
Xxxxxxx Sachs Credit Partners L.P. $51,000,000 78.45%
The CIT Group/Business Credit, Inc. $ 7,000,000 10.75%
Antares Capital Corporation $ 2,000,000 3.1%
LaSalle Bank National Association $ 5,000,000 7.7%
----------- -----
TOTAL $65,000,000 100%
=========== =====
X-0
XXXXXXXX X
TO CREDIT AND GUARANTY AGREEMENT
NOTICE ADDRESSES
STANADYNE CORPORATION
00 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx
Telecopier: 000-000-0000
in each case, with a copy to:
Ropes & Xxxx LLP
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxxx
Telecopier: 000-000-0000
B-1
XXXXXXX SACHS CREDIT PARTNERS L.P.,
as Sole Lead Arranger, Sole Bookrunner,
Syndication Agent, Administrative Agent, Collateral Agent and a Lender
Xxxxxxx Xxxxx Credit Partners L.P.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
Telecopier: 000-000-0000
with a copy to:
Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
Telecopier: (000) 000-0000
APPENDIX B-2
THE CIT GROUP/BUSINESS CREDIT, INC.,
as a Lender
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Regional Credit Manager
Telecopier: 000-000-0000
APPENDIX B-3
ANTARES CAPITAL CORPORATION
as a Lender
000 X. Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Telecopier: 000-000-0000
APPENDIX B-4
LASALLE BANK NATIONAL ASSOCIATION,
as a Lender
000 X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxx
Telecopier: 000-000-0000
APPENDIX B-5
EXHIBIT B TO
TERM CREDIT AND GUARANTY AGREEMENT
TERM LOAN NOTE
$[1][___,___,___]
New York, New York
FOR VALUE RECEIVED, STANADYNE CORPORATION, a Delaware corporation
("COMPANY"), promises to pay [NAME OF LENDER] ("PAYEE") or its registered
assigns on or before August 6, 2011, the principal amount of [1][DOLLARS]
($[___,___,___][1]) in the installments referred to below.
Company also promises to pay interest on the unpaid principal amount
hereof, from the date hereof until paid in full, at the rates and at the times
which shall be determined in accordance with the provisions of that certain Term
Credit and Guaranty Agreement, dated as of August 6, 2004 (as it may be amended,
supplemented or otherwise modified, the "TERM CREDIT AGREEMENT"; the terms
defined therein and not otherwise defined herein being used herein as therein
defined), by and among Company, STANADYNE AUTOMOTIVE HOLDING CORP., certain
Subsidiaries of Company, as Guarantors, the Lenders party thereto from time to
time, and XXXXXXX XXXXX CREDIT PARTNERS L.P., as Sole Lead Arranger, Sole
Bookrunner, Syndication Agent, Administrative Agent and Collateral Agent.
Company shall make scheduled principal payments on this Note as set
forth in Section 2.2 of the Credit Agreement.
This Note is one of the "Term Loan Notes" in the aggregate principal
amount of $65,000,000 and is issued pursuant to and entitled to the benefits of
the Term Credit Agreement, to which reference is hereby made for a more complete
statement of the terms and conditions under which the Term Loan evidenced hereby
was made and is to be repaid.
All payments of principal and interest in respect of this Note shall be
made in lawful money of the United States of America in same day funds at the
Principal Office of Administrative Agent or at such other place as shall be
designated in writing for such purpose in accordance with the terms of the Term
Credit Agreement. Unless and until an Assignment Agreement effecting the
assignment or transfer of the obligations evidenced hereby shall have been
accepted by Administrative Agent and recorded in the Register, Company, each
Agent and Lenders shall be entitled to deem and treat Payee as the owner and
holder of this Note and the obligations evidenced hereby. Payee hereby agrees,
by its acceptance hereof, that before disposing of this Note or any part hereof
it will make a notation hereon of all principal payments previously made
hereunder and of the date to which interest hereon has been paid; provided, the
failure to make a notation of any payment made on this Note shall not limit or
otherwise affect
-----------------
[1] Lender's Term Loan Commitment
EXHIBIT B-1
the obligations of Company hereunder with respect to payments of principal of or
interest on this Note.
This Note is subject to mandatory prepayment and to prepayment at the
option of Company, each as provided in the Term Credit Agreement.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF COMPANY AND PAYEE HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK.
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note, together with all accrued and unpaid interest
thereon, may become, or may be declared to be, due and payable in the manner,
upon the conditions and with the effect provided in the Term Credit Agreement.
The terms of this Note are subject to amendment only in the manner
provided in the Term Credit Agreement.
No reference herein to the Term Credit Agreement and no provision of
this Note or the Term Credit Agreement shall alter or impair the obligations of
Company, which are absolute and unconditional, to pay the principal of and
interest on this Note at the place, at the respective times, and in the currency
herein prescribed.
Company promises to pay all costs and expenses, including reasonable
attorneys' fees, all as provided in the Term Credit Agreement, incurred in the
collection and enforcement of this Note. Company and any endorsers of this Note
hereby consent to renewals and extensions of time at or after the maturity
hereof, without notice, and hereby waive diligence, presentment, protest, demand
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defense to any demand hereunder.
EXHIBIT B-2
IN WITNESS WHEREOF, Company has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.
STANADYNE CORPORATION
By: ______________________________
Title:
EXHIBIT B-3
