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Exhibit 4(a)
CREDIT AGREEMENT, dated as of May 1, 1998, among the following:
(i) ROYAL APPLIANCE MFG. CO., an Ohio corporation (herein, together
with its successors and assigns, the "BORROWER");
(ii) the lending institutions listed in Annex I hereto (each a
"LENDER" and collectively, the "LENDERS"); and
(iii) NATIONAL CITY BANK, a national banking association, as
administrative agent (the "ADMINISTRATIVE AGENT"):
PRELIMINARY STATEMENTS:
(1) Unless otherwise defined herein, all capitalized terms used
herein and defined in section 1 are used herein as so defined.
(2) The Borrower has applied to the Lenders for credit facilities in
order to (i) refinance existing credit facilities, (ii) provide financing for
acquisitions, and (iii) provide working capital and funds for other lawful
purposes.
(3) Subject to and upon the terms and conditions set forth herein,
the Lenders are willing to make available to the Borrower the credit facilities
provided for herein.
NOW, THEREFORE, it is agreed:
SECTION 1. DEFINITIONS AND TERMS.
1.1. CERTAIN DEFINED TERMS. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires:
"ACQUISITION" shall mean and include (i) any acquisition on a going
concern basis (whether by purchase, lease or otherwise) of any facility and/or
business operated by any person who is not a Subsidiary of the Borrower, and
(ii) acquisitions of a majority of the outstanding equity or other similar
interests in any such person (whether by merger, stock purchase or otherwise).
"ADMINISTRATIVE AGENT" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to section 11.9.
"AFFILIATE" shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 25% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
by reason of such status, be considered an Affiliate of such person; and (y)
neither the Administrative Agent nor any Lender shall in any event be considered
an Affiliate of the Borrower or any of its Subsidiaries.
"AGREEMENT" shall mean this Credit Agreement, as the same may be from
time to time further modified, amended and/or supplemented.
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"APPLICABLE EURODOLLAR MARGIN" shall have the meaning provided in
section 2.7(g).
"APPLICABLE COMMITMENT FEE RATE" shall have the meaning provided in
section 4.1(a).
"APPLICABLE LENDING OFFICE" shall mean, with respect to each Lender,
(i) such Lender's Domestic Lending Office in the case of Borrowings consisting
of Prime Rate Loans and (ii) such Lender's Eurodollar Lending Office in the case
of Borrowings consisting of Eurodollar Loans.
"ASSET SALE" shall mean the sale, transfer or other disposition
(including by means of Sale and Lease-Back Transactions, and by means of
mergers, consolidations, and liquidations of a corporation, partnership or
limited liability company of the interests therein of the Borrower or any
Subsidiary) by the Borrower or any Subsidiary to any person other than the
Borrower or any Subsidiary of any of their respective assets, PROVIDED that the
term Asset Sale specifically excludes any sales, transfers or other dispositions
of inventory, or obsolete or excess furniture, fixtures, equipment or other
property, tangible or intangible, in each case in the ordinary course of
business.
"ASSIGNMENT AGREEMENT" shall mean an Assignment Agreement
substantially in the form of Exhibit F hereto.
"AUTHORIZED OFFICER" shall mean any officer or employee of the
Borrower designated as such in writing to the Administrative Agent by the
Borrower.
"BANKRUPTCY CODE" shall have the meaning provided in section 10.1(h).
"BORROWER" shall have the meaning provided in the first paragraph of
this Agreement.
"BORROWING" shall mean the incurrence of Loans consisting of one Type
of Loan, by the Borrower from all of the Lenders having Commitments in respect
thereof on a PRO RATA basis on a given date (or resulting from conversions on a
given date), having in the case of Eurodollar Loans the same Interest Period.
"BUSINESS DAY" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day excluding Saturday, Sunday and any day which shall
be in the city in which the Payment Office is located a legal holiday or a day
on which banking institutions are authorized by law or other governmental
actions to close and (ii) with respect to all notices and determinations in
connection with, and payments of principal and interest on, Eurodollar Loans,
any day which is a Business Day described in clause (i) and which is also a day
for trading by and between banks in U.S. dollar deposits in the interbank
Eurodollar market.
"CAPITAL LEASE" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that person.
"CAPITALIZED LEASE OBLIGATIONS" shall mean all obligations under
Capital Leases of the Borrower or any of its Subsidiaries in each case taken at
the amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP.
"CASH EQUIVALENTS" shall mean any of the following:
(i) securities issued or directly and fully guaranteed or
insured by the United States of America or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of
the United States of America is pledged in support thereof) having
maturities of not more than one year from the date of acquisition;
(ii) U.S. dollar denominated time deposits, certificates
of deposit and bankers' acceptances of (x) any Lender or (y) any bank
whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from Xxxxx'x is at least P-1 or the
equivalent thereof (any such bank, an "APPROVED BANK"), in each case
with maturities of not more than 180 days from the date of
acquisition;
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(iii) commercial paper issued by any Lender or Approved
Bank or by the parent company of any Lender or Approved Bank and
commercial paper issued by, or guaranteed by, any industrial or
financial company with a short- term commercial paper rating of at
least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody's, or guaranteed by any industrial
company with a long term unsecured debt rating of at least A or A2,
or the equivalent of each thereof, from S&P or Moody's, as the case
may be, and in each case maturing within 270 days after the date of
acquisition;
(iv) investments in money market funds substantially all
the assets of which are comprised of securities of the types
described in clauses (i) through (iii) above; and
(v) investments in money market funds access to which is
provided as part of "sweep" accounts maintained with a Lender or an
Approved Bank.
"CASH PROCEEDS" shall mean, with respect to any Asset Sale, the
aggregate cash payments (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, but only as and
when so received) received by the Borrower and/or any Subsidiary from such Asset
Sale.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. ss. 9601 ET SEQ.
"CHANGE OF CONTROL" shall mean and include any of the following:
(i) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the
Borrower's Board of Directors (together with any new directors whose
election by the Borrower's Board of Directors or whose nomination for
election by the Borrower's shareholders was approved by a vote of at
least two-thirds of the directors then still in office who either
were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any
reason to constitute a majority of the directors then in office;
(ii) any person or group (as such term is defined in
section 13(d)(3) of the 1934 Act), other than the Borrower, any
trustee or other fiduciary holding securities under an employee
benefit plan of the Borrower and the Current Holder Group, shall
acquire, directly or indirectly, beneficial ownership (within the
meaning of Rule 13d-3 and 13d-5 of the 0000 Xxx) of more than 20%, on
a fully diluted basis, of the economic or voting interest in the
Borrower's capital stock;
(iii) the shareholders of the Borrower approve a merger or
consolidation of the Borrower with any other person, OTHER than a
merger or consolidation which would result in the voting securities
of the Borrower outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted or
exchanged for voting securities of the surviving or resulting entity)
more than 75% of the combined voting power of the voting securities
of the Borrower or such surviving or resulting entity outstanding
after such merger or consolidation;
(iv) the shareholders of the Borrower approve a plan of
complete liquidation of the Borrower or an agreement or agreements
for the sale or disposition by the Borrower of all or substantially
all of the Borrower's assets; and/or
(v) any "Change of Control" or similar term as defined in
any agreement or instrument evidencing or governing Indebtedness of
the Borrower in an original aggregate principal amount of at least
$10,000,000.
"CLOSING DATE" shall mean the date, on or after the Effective Date,
upon which the conditions specified in section 6.1 are satisfied.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations
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promulgated and the rulings issued thereunder. Section references to the Code
are to the Code, as in effect at the Effective Date and any subsequent
provisions of the Code, amendatory thereof, supplemental thereto or substituted
therefor.
"COLLATERAL" shall mean any collateral covered by any Security
Document.
"COLLATERAL AGENT" shall mean the Administrative Agent acting as
Collateral Agent for the Lenders pursuant to the Security Documents.
"COMMITMENT" shall mean, with respect to each Lender, the amount set
forth opposite such Lender's name in Annex I as its "Commitment" as the same may
be reduced from time to time pursuant to section 4.2, 4.3 and/or 10.2 or
adjusted from time to time as a result of assignments to or from such Lender
pursuant to section 12.4.
"COMMITMENT FEE" shall have the meaning provided in section 4.1(a).
"CONSOLIDATED AMORTIZATION EXPENSE" shall mean, for any period, all
amortization expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED CAPITAL EXPENDITURES" shall mean, for any period, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including in all events amounts expended or capitalized under Capital Leases
but excluding any amount representing capitalized interest) by the Borrower and
its Subsidiaries during that period that, in conformity with GAAP, are or are
required to be included in the property, plant or equipment reflected in the
consolidated balance sheet of the Borrower and its Subsidiaries.
"CONSOLIDATED DEPRECIATION EXPENSE" shall mean, for any period, all
depreciation expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED EBIT" shall mean, for any period, Consolidated Net
Income for such period; PLUS (A) the sum of the amounts for such period included
in determining such Consolidated Net Income of (i) Consolidated Interest
Expense, (ii) Consolidated Income Tax Expense, (iii) amortization or write-off
of deferred financing costs, and (iv) extraordinary and other non-recurring
non-cash losses and charges; LESS (B) gains on sales of assets and other
extraordinary gains and other non-recurring non-cash gains; all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP; PROVIDED that, notwithstanding anything to the contrary contained herein,
the Borrower's Consolidated EBIT for any Testing Period shall (x) include the
appropriate financial items for any person or business unit which has been
acquired by the Borrower for any portion of such Testing Period prior to the
date of acquisition, and (y) exclude the appropriate financial items for any
person or business unit which has been disposed of by the Borrower, for the
portion of such Testing Period prior to the date of disposition.
"CONSOLIDATED EBITDA" shall mean, for any period, Consolidated EBIT
for such period; PLUS the sum (without duplication) of the amounts for such
period included in determining such Consolidated EBIT of (i) Consolidated
Depreciation Expense, and (ii) Consolidated Amortization Expense, all as
determined for the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP; PROVIDED that, notwithstanding anything to the contrary
contained herein, the Borrower's Consolidated EBITDA for any Testing Period
shall (x) include the appropriate financial items for any person or business
unit which has been acquired by the Borrower for any portion of such Testing
Period prior to the date of acquisition, and (y) exclude the appropriate
financial items for any person or business unit which has been disposed of by
the Borrower, for the portion of such Testing Period prior to the date of
disposition.
"CONSOLIDATED INCOME TAX EXPENSE" shall mean, for any period, all
provisions for taxes based on the net income of the Borrower or any of its
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, total
interest expense (including that which is capitalized and that which is
attributable to Capital Leases, in accordance with GAAP) of the Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries including, without
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limitation, net costs under Hedge Agreements, but excluding, however, any
amortization of deferred financing costs, all as determined in accordance with
GAAP.
"CONSOLIDATED NET INCOME" shall mean for any period, the net income
(or loss) of the Borrower and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP,
PROVIDED that there shall be excluded therefrom (i) the income, (or loss) of any
entity (other than Subsidiaries of the Borrower) in which the Borrower or any of
its Subsidiaries has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to the Borrower or any of its
Subsidiaries during such period, and (ii) the income of any Subsidiary of the
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.
"CONSOLIDATED NET WORTH" shall mean at any time for the determination
thereof all amounts which, in conformity with GAAP, would be included under the
caption "total stockholders' equity" (or any like caption) on a consolidated
balance sheet of the Borrower as at such date, PROVIDED that in no event shall
Consolidated Net Worth include any amounts in respect of preferred stock or
similar equity securities which is subject to mandatory redemption, in whole or
in part, pursuant to a sinking fund, scheduled redemption or similar provisions,
at any time prior to the Maturity Date.
"CONSOLIDATED TOTAL INDEBTEDNESS" shall mean the sum (without
duplication) of the principal amount (or Capitalized Lease Obligation, in the
case of a Capital Lease) of all Indebtedness of the Borrower and of each of its
Subsidiaries, all as determined on a consolidated basis.
"CONSOLIDATED TOTAL LIABILITIES" shall mean the sum (without
duplication) of (i) Consolidated Total Indebtedness; and (ii) all other
liabilities of the Borrower and its Subsidiaries which would be shown and
classified as liabilities on a consolidated balance sheet of the Borrower and
its Subsidiaries prepared in accordance with GAAP.
"CREDIT DOCUMENTS" shall mean this Agreement, the Notes, the
Subsidiary Guaranty, the Security Documents and any Letter of Credit Document.
"CREDIT EVENT" shall mean the making of any Loans and/or the issuance
of any Letter of Credit.
"CREDIT PARTY" shall mean the Borrower and each of its Subsidiaries
which is a party to any Credit Document.
"CURRENT HOLDER GROUP" shall mean (i) those persons who are officers
and directors of the Company at the Effective Date, (ii) the spouses, heirs,
legatees, descendants and blood relatives to the third degree of consanguinity
of any such person, (iii) the executors and administrators of the estate of any
such person, and any court appointed guardian of any such person, (iv) any trust
for the benefit of any such person referred to in the foregoing clauses (i) and
(ii) or any other persons, so long as one or more members of the Current Holder
Group has the exclusive right to control the voting and disposition of
securities held by such trust, and (v) Richmont Capital Partners I L. P. or any
of its Affiliates.
"DEFAULT" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"DEFAULTING LENDER" shall mean any Lender with respect to which a
Lender Default is in effect.
"DESIGNATED HEDGE AGREEMENT" shall mean any Hedge Agreement to which
the Borrower or any of its Subsidiaries is a party which, pursuant to a written
instrument signed by the Administrative Agent, has been designated as a
Designated Hedge Agreement so that the Borrower's or Subsidiaries's
counterparty's credit exposure thereunder will be entitled to share in the
benefits of the Subsidiary Guaranty and the Security Documents to the extent the
Subsidiary Guaranty and such Security Documents provide guarantees or security
for creditors of the Borrower or any Subsidiary under Designated Hedge
Agreements. The Administrative Agent may, without the approval or consent of the
Lenders, designate a Hedge Agreement as a Designated Hedge Agreement if the
counterparty is a Lender or an Affiliate of a Lender and the maximum credit
exposure of such counterparty under such Hedge Agreement to the Borrower and its
Subsidiaries, when taken together with the maximum credit exposure under all
other Hedge Agreements which are Designated Hedge Agreements, is reasonably
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determined by the Administrative Agent, in accordance with its own customary
valuation practices, not to exceed $4,000,000 in the aggregate; however, if the
counterparty is not a Lender or an Affiliate of a Lender, or such credit
exposure is so determined by the Administrative Agent to be such that the
aggregate credit exposure under all Designated Hedge Agreements would be greater
than $4,000,000 if such Hedge Agreement were to be a Designated Hedge Agreement,
the Administrative Agent shall only designate the Hedge Agreement involving such
counterparty as a Designated Hedge Agreement if the Administrative Agent is
instructed to do so by the Required Lenders, PROVIDED that absent instructions
from all of the Lenders, the maximum aggregate credit exposure, as computed by
the Administrative Agent, under all Designated Hedge Agreements with
counterparties who are not a Lender or an Affiliate of a Lender shall in no
event exceed $1,000,000. The Administrative Agent may impose as a condition to
any designation of a Designated Hedge Agreement a requirement that the
counterparty enter into an intercreditor or similar agreement with the
Administrative Agent under which recoveries from the Borrower and its
Subsidiaries with respect to such Designated Hedge Agreement will be shared in a
manner consistent with the provisions of section 10.3 hereof.
"DOLLARS", "U.S. DOLLARS" and the sign "$" each means lawful money of
the United States.
"DOMESTIC LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its Domestic Lending Office in Annex I or in
the Assignment Agreement pursuant to which it became a Lender, or such other
office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" shall mean any Subsidiary organized under the
laws of the United States of America, any State thereof, the District of
Columbia, or any United States possession, the chief executive office and
principal place of business of which is located in, and which conducts the
majority of its business within, the United States of America and its
territories and possessions.
"EFFECTIVE DATE" shall have the meaning provided in section 12.10.
"ELIGIBLE TRANSFEREE" shall mean and include a commercial bank,
financial institution or other "accredited investor" (as defined in SEC
Regulation D), in each case which
(i) is not disapproved in writing by the Borrower in a
notice given to a requesting Lender and the Administrative Agent,
specifying the reasons for such disapproval, within five Business
Days following the giving of notice to the Borrower of the identity
of any proposed transferee (any such disapproval by the Borrower must
be reasonable), PROVIDED that the Borrower shall not be entitled to
exercise the foregoing right of disapproval if and so long as (x) any
Event of Default shall have occurred and be continuing, or (y) a
waiver or other temporary modification of any of the financial
covenants contained in this Agreement shall be in effect following a
deterioration in the financial condition or results of operations of
the Borrower and its Subsidiaries; and
(ii) is not a direct competitor of the Borrower or engaged
in the same or similar principal lines of business as the Borrower
and its Subsidiaries considered as a whole, or is not an Affiliate of
any such competitor of the Borrower and its Subsidiaries.
"ENVIRONMENTAL CLAIMS" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of non-compliance or violation, investigations or proceedings relating
in any way to any Environmental Law or any permit issued under any such law
(hereafter "CLAIMS"), including, without limitation, (i) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (ii) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the storage, treatment or Release (as defined
in CERCLA) of any Hazardous Materials or arising from alleged injury or threat
of injury to health, safety or the environment.
"ENVIRONMENTAL LAW" shall mean any applicable Federal, state, foreign
or local statute, law, rule, regulation, ordinance, code, binding and
enforceable guideline, binding and enforceable written policy and rule of common
law now or hereafter in effect and in each case as amended, and any binding and
enforceable judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment issued to or
rendered against the Borrower
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or any of its Subsidiaries relating to the environment, employee health and
safety or Hazardous Materials, including, without limitation, CERCLA; RCRA; the
Federal Water Pollution Control Act, 33 U.S.C. ss. 2601 ET SEQ.; the Clean Air
Act, 42 U.S.C. ss. 7401 ET SEQ.; the Safe Drinking Water Act, 42 U.S.C. ss. 3803
ET SEQ.; the Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 ET SEQ.; the
Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C. ss.
11001 ET SEQ., the Hazardous Material Transportation Act, 49 U.S.C. ss. 1801 ET
SEQ. and the Occupational Safety and Health Act, 29 U.S.C. ss. 651 ET SEQ. (to
the extent it regulates occupational exposure to Hazardous Materials); and any
state and local or foreign counterparts or equivalents, in each case as amended
from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at the
Effective Date and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA AFFILIATE" shall mean each person (as defined in section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a "single employer" (i) within the meaning of section
414(b),(c), (m) or (o) of the Code or (ii) as a result of the Borrower or a
Subsidiary of the Borrower being or having been a general partner of such
person.
"EURODOLLAR LENDING OFFICE" shall mean, with respect to any Lender,
the office of such Lender specified as its Eurodollar Lending Office in Annex I
or in the Assignment Agreement pursuant to which it became a Lender, or such
other office or offices for Eurodollar Loans of such Lender as such Lender may
from time to time specify to the Borrower and the Administrative Agent.
"EURODOLLAR LOANS" shall mean each Loan bearing interest at the rates
provided in section 2.7(b).
"EURODOLLAR RATE" shall mean with respect to each Interest Period for
a Eurodollar Loan, (A) either (i) the rate per annum for deposits in Dollars of
amounts in same day funds comparable to the outstanding principal amount of the
Eurodollar Loan for which an interest rate is then being determined for a
maturity most nearly comparable to such Interest Period which appears on page
3750 of the Dow Xxxxx Telerate Screen as of 11:00 A.M. (local time at the Notice
Office) on the date which is two Business Days prior to the commencement of such
Interest Period, or (ii) if such a rate does not appear on such page, an
interest rate per annum equal to the average (rounded upward to the nearest
whole multiple of 1/16 of 1% per annum, if such average is not such a multiple)
of the rate per annum at which deposits in Dollars are offered to each of the
Reference Banks by prime banks in the London interbank Eurodollar market for
deposits of amounts in Dollars in same day funds comparable to the outstanding
principal amount of the Eurodollar Loan for which an interest rate is then being
determined with maturities comparable to the Interest Period to be applicable to
such Eurodollar Loan, determined as of 11:00 A.M. (London time) on the date
which is two Business Days prior to the commencement of such Interest Period, in
each case divided (and rounded upward to the nearest whole multiple of 1/16th of
1%) by (B) a percentage equal to 100% minus the then stated maximum rate of all
reserve requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves and without benefit of credits for
proration, exceptions or offsets which may be available from time to time)
applicable to any member bank of the Federal Reserve System in respect of
Eurocurrency liabilities as defined in Regulation D (or any successor category
of liabilities under Regulation D).
"EVENT OF DEFAULT" shall have the meaning provided in section 10.1.
"EXISTING INDEBTEDNESS" shall have the meaning provided in section
7.18.
"EXISTING INDEBTEDNESS AGREEMENTS" shall have the meaning provided in
section 7.18.
"EXISTING LETTER OF CREDIT" shall have the meaning provided in
section 3.1(d).
"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from
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three Federal Funds brokers of recognized standing selected by the
Administrative Agent.
"FEES" shall mean all amounts payable pursuant to, or referred to in,
section 4.1.
"FINANCIAL PROJECTIONS" shall have the meaning provided in section
7.8(c).
"FOREIGN SUBSIDIARY" shall mean any Subsidiary (i) which is not
incorporated in the United States and substantially all of whose assets and
properties are located, or substantially all of whose business is carried on,
outside the United States, or (ii) substantially all of whose assets consist of
Subsidiaries that are Foreign Subsidiaries as defined in clause (i) of this
definition.
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; it being understood and
agreed that determinations in accordance with GAAP for purposes of section 9,
including defined terms as used therein, are subject (to the extent provided
therein) to sections 1.3 and 12.7(a).
"GUARANTY OBLIGATIONS" shall mean as to any person (without
duplication) any obligation of such person guaranteeing any Indebtedness
("PRIMARY INDEBTEDNESS") of any other person (the "PRIMARY OBLIGOR") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such person, whether or not contingent, (a) to purchase any such
primary Indebtedness or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary Indebtedness or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof, PROVIDED, HOWEVER, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary Indebtedness in respect of which such Guaranty Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such person is required to perform
thereunder) as determined by such person in good faith.
"HEDGE AGREEMENT" shall mean (i) any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement designed to protect against fluctuations in interest
rates, and (ii) any currency swap agreement, forward currency purchase agreement
or similar agreement or arrangement designed to protect against fluctuations in
currency exchange rates.
"HAZARDOUS MATERIALS" shall mean (i) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; and (ii) any chemicals, materials or substances defined as or
included in the definition of "hazardous substances", "hazardous wastes",
"hazardous materials", "restricted hazardous materials", "extremely hazardous
wastes", "restrictive hazardous wastes", "toxic substances", "toxic pollutants",
"contaminants" or "pollutants", or words of similar meaning and regulatory
effect, under any applicable Environmental Law.
"INDEBTEDNESS" of any person shall mean without duplication:
(i) all indebtedness of such person for borrowed money;
(ii) all bonds, notes, debentures and similar debt
securities of such person;
(iii) the deferred purchase price of capital assets or
services which in accordance with GAAP would be shown on the
liability side of the balance sheet of such person;
(iv) the face amount of all letters of credit issued for
the account of such person and, without duplication, all drafts drawn
thereunder;
(v) all obligations, contingent or otherwise, of such
person in respect of bankers' acceptances;
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(vi) all Indebtedness of a second person secured by any
Lien on any property owned by such first person, whether or not such
indebtedness has been assumed;
(vii) all Capitalized Lease Obligations of such person;
(viii) the present value, determined on the basis of the
implicit interest rate, of all basic rental obligations under all
"synthetic" leases (i.e. leases accounted for by the lessee as
operating leases under which the lessee is the "owner" of the leased
property for Federal income tax purposes);
(ix) all obligations of such person to pay a specified
purchase price for goods or services whether or not delivered or
accepted, I.E., take-or-pay and similar obligations;
(x) all net obligations of such person under Hedge
Agreements;
(xi) the full outstanding balance of trade receivables,
notes or other instruments sold with full recourse (and the portion
thereof subject to potential recourse, if sold with limited
recourse), other than in any such case any thereof sold solely for
purposes of collection of delinquent accounts;
(xii) the stated value, or liquidation value if higher, of
all preferred stock and similar equity securities of such person
which are subject to mandatory redemption, in whole or in part,
pursuant to a sinking fund, scheduled redemption or similar
provisions, at any time prior to the Maturity Date; and
(xiii) all Guaranty Obligations of such person;
PROVIDED that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same), shall constitute Indebtedness; and (y) the
Indebtedness of any person shall in any event include (without duplication) the
Indebtedness of any other entity (including any general partnership in which
such person is a general partner) to the extent such person is liable thereon as
a result of such person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide expressly
that such person is not liable thereon.
"INTEREST PERIOD" with respect to any Eurodollar Loan shall mean the
interest period applicable thereto, as determined pursuant to section 2.8.
"LEASEHOLDS" of any person means all the right, title and interest of
such person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
"LENDER" shall have the meaning provided in the first paragraph of
this Agreement.
"LENDER DEFAULT" shall mean (i) the refusal (which has not been
retracted) of a Lender in violation of the requirements of this Agreement to
make available its portion of any incurrence of Loans or to fund its portion of
any unreimbursed payment under section 3.4(c) or (ii) a Lender having notified
the Administrative Agent and/or the Borrower that it does not intend to comply
with the obligations under section 2.1 and/or section 3.4(c), in the case of
either (i) or (ii) as a result of the appointment of a receiver or conservator
with respect to such Lender at the direction or request of any regulatory agency
or authority.
"LENDER REGISTER" shall have the meaning provided in section 12.16.
"LETTER OF CREDIT" shall have the meaning provided in section 3.1(a).
"LETTER OF CREDIT DOCUMENTS" shall have the meaning specified in
section 3.2(a).
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"LETTER OF CREDIT FEE" shall have the meaning provided in section
4.1(b).
"LETTER OF CREDIT ISSUER" shall mean (i) in respect of each Existing
Letter of Credit, the Lender that has issued same as of the Effective Date; and
(ii) in respect of any other Letter of Credit, NCB.
"LETTER OF CREDIT OUTSTANDINGS" shall mean, at any time, the sum,
without duplication, of (i) the aggregate Stated Amount of all outstanding
Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings.
"LETTER OF CREDIT REQUEST" shall have the meaning provided in section
3.2(a).
"LIEN" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement or any
lease in the nature thereof).
"LOAN" shall have the meaning provided in section 2.1.
"MARGIN STOCK" shall have the meaning provided in Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on the
business, operations, property, assets, liabilities or financial condition of,
(i) when used with reference to the Borrower or any of its Subsidiaries, the
Borrower and its Subsidiaries, taken as a whole, or (ii) when used with
reference to any other person, such person and its Subsidiaries, taken as a
whole, as the case may be.
"MATERIAL SUBSIDIARY" shall mean, at any time, with reference to any
person, any Subsidiary of such person (i) that has assets at such time
comprising 10% or more of the consolidated assets of such person and its
Subsidiaries, or (ii) whose operations in the current fiscal year are expected
to, or whose operations in the most recent fiscal year did (or would have if
such person had been a Subsidiary for such entire fiscal year), represent 10% or
more of the consolidated earnings before interest, taxes, depreciation and
amortization of such person and its Subsidiaries for such fiscal year.
"MATURITY DATE" shall mean April 1, 2001, unless earlier terminated,
or extended in accordance with section 4.4.
"MINIMUM BORROWING AMOUNT" shall mean (i) for Prime Rate Loans,
$100,000, with minimum increments thereafter of $100,000 and (ii) for Eurodollar
Loans, $1,000,000, with minimum increments thereafter of $500,000.
"MOODY'S" shall mean Xxxxx'x Investors Service, Inc. and its
successors.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan, as defined in
section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions or has within any of the
preceding three plan years made or accrued an obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" shall mean an employee benefit plan, other
than a Multiemployer Plan, to which the Borrower or any ERISA Affiliate, and one
or more employers other than the Borrower or an ERISA Affiliate, is making or
accruing an obligation to make contributions or, in the event that any such plan
has been terminated, to which the Borrower or an ERISA Affiliate made or accrued
an obligation to make contributions during any of the five plan years preceding
the date of termination of such plan.
"NCB" shall mean National City Bank, a national banking association,
together with its successors and assigns.
"NET CASH PROCEEDS" shall mean, with respect to any Asset Sale, the
Cash Proceeds resulting therefrom net of (i) reasonable and customary expenses
of sale incurred in connection with such Asset Sale, and other reasonable and
customary fees and expenses incurred, and all state, and local taxes paid or
reasonably estimated to be payable by such person, as a consequence of such
Asset Sale and the payment of principal, premium and interest of Indebtedness
secured by the asset which is the subject of the Asset Sale and required to be,
and which is, repaid under the terms thereof as a result of such Asset Sale,
(ii) amounts of any distributions payable to holders of minority interests in
the relevant person or in the relevant property or
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assets and (iii) incremental income taxes paid or payable as a result thereof.
"1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"NON-DEFAULTING LENDER" shall mean each Lender other than a
Defaulting Lender.
"NOTE" shall have the meaning provided in section 2.5(a).
"NOTICE OF BORROWING" shall have the meaning provided in section
2.3(a).
"NOTICE OF CONVERSION" shall have the meaning provided in section
2.6.
"NOTICE OFFICE" shall mean the office of the Administrative Agent at
0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, Attention: Xxxxxx X. Xxxxx, Xx.,
Senior Vice President (telephone: (000) 000-0000; facsimile: (000) 000-0000), or
such other office, located in a city in the United States Eastern Time Zone, as
the Administrative Agent may designate to the Borrower from time to time.
"OBLIGATIONS" shall mean all amounts, direct or indirect, contingent
or absolute, of every type or description, and at any time existing, owing to
the Administrative Agent or any Lender pursuant to the terms of this Agreement
or any other Credit Document.
"PARTICIPANT" shall have the meaning provided in section 3.4(a).
"PAYMENT OFFICE" shall mean the office of the Administrative Agent at
0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, Attention: Xxxxxx Xxxxxx
(telephone: (000) 000-0000; facsimile: (000) 000-0000), or such other office,
located in a city in the United States Eastern Time Zone, as the Administrative
Agent may designate to the Borrower from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to section 4002 of ERISA, or any successor thereto.
"PERCENTAGE" shall mean at any time for any Lender, the percentage
obtained by dividing such Lender's Commitment by the Total Commitment, PROVIDED,
that if the Total Commitment has been terminated, the Percentage for each Lender
shall be determined by dividing such Lender's Commitment immediately prior to
such termination by the Total Commitment immediately prior to such termination.
"PERMITTED ACQUISITION" shall mean and include any Acquisition as to
which all of the following conditions are satisfied:
(i) such Acquisition involves a line or lines of business
which is complementary to the lines of business in which the Borrower
and its Subsidiaries, considered as an entirety, are engaged on the
Effective Date, UNLESS the Required Lenders specifically approve or
consent to such Acquisition in writing;
(ii) such Acquisition is not actively opposed by the Board
of Directors (or similar governing body) of the selling person or the
person whose equity interests are to be acquired, UNLESS all of the
Lenders specifically approve or consent to such Acquisition in
writing;
(iii) the aggregate consideration for such Acquisition (and
any related contemporaneous Acquisitions from the same or related
persons), including the principal amount of any assumed Indebtedness
and (without duplication) any Indebtedness of any acquired person or
persons, does not exceed $3,000,000, UNLESS the Required Lenders
specifically approve or consent to such Acquisition in writing;
(iv) the aggregate consideration for such Acquisition and
all other Permitted Acquisitions completed after December 31, 1997,
including the principal amount of any assumed Indebtedness and
(without duplication) any Indebtedness of any acquired person or
persons, does not exceed $10,000,000, UNLESS the Required Lenders
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specifically approve or consent to such Acquisition;
(v) the Borrower would, after giving effect to such
Acquisition, be in compliance, on a PRO FORMA basis, with the
financial covenants contained in sections 9.7, 9.8 and 9.9; and
(vi) if the aggregate consideration for such Acquisition,
including the principal amount of any assumed Indebtedness and
(without duplication) any Indebtedness of any acquired person or
persons, exceeds $3,000,000, at least 10 Business Days prior to the
completion of such transaction the Borrower shall have delivered to
the Lenders a certificate of a responsible financial or accounting
officer of the Borrower demonstrating, in reasonable detail, the
computation of such PRO FORMA ratios, such PRO FORMA ratios being
determined
(A) as if (x) such Acquisition had been completed
at the beginning of the most recent period of four
consecutive fiscal quarters of the Borrower for which
financial information for the Borrower and the business or
person to be acquired, is available and has been delivered
to the Lenders at least 10 Business Days prior to the
completion of such transaction (which shall in the case of
the acquired business include audited financial statements
for the most recent fiscal year, unless the same are
unavailable and unaudited financial statements are
acceptable to the Required Lenders), and (y) any such
Indebtedness, or other Indebtedness incurred to finance
such Acquisition, had been outstanding for such period; and
(B) without giving effect to any credit for
unobtained or unrealized gains in connection with such
Acquisition, but taking into account such adjustments to
the overhead of such properties and assets as may
reasonably be determined and specified by the Borrower to
reflect the overhead generally applicable to similar
properties and assets owned by the Borrower and its
Subsidiaries, as and to the extent the Administrative Agent
determines (acting on instructions from the Required
Lenders) such adjustments to be reasonable and appropriate
under the particular circumstances);
PROVIDED, that the term Permitted Acquisition specifically excludes any loans,
advances or minority investments otherwise permitted pursuant to section 9.5.
"PERMITTED LIENS" shall mean Liens permitted by section 9.3.
"PERSON" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"PLAN" shall mean any multiemployer or single-employer plan as
defined in section 4001 of ERISA, which is maintained or contributed to by (or
to which there is an obligation to contribute by) the Borrower or a Subsidiary
of the Borrower or an ERISA Affiliate, and each such plan for the five year
period immediately following the latest date on which the Borrower, or a
Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed to or
had an obligation to contribute to such plan.
"PRIME RATE" shall mean, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time which rate per annum shall at
all times be equal to the greater of (i) the rate of interest established by NCB
in Cleveland, Ohio, from time to time, as its prime rate, whether or not
publicly announced, which interest rate may or may not be the lowest rate
charged by it for commercial loans or other extensions of credit; and (ii) the
Federal Funds Effective Rate in effect from time to time PLUS 1/2 of 1% per
annum.
"PRIME RATE LOAN" shall mean each Loan bearing interest at the rate
provided in section 2.7(a).
"PROHIBITED TRANSACTION" shall mean a transaction with respect to a
Plan that is prohibited under section 4975 of the Code or section 406 of ERISA
and not exempt under section 4975 of the Code or section 408 of ERISA.
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time,
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42 U.S.C. ss. 6901 ET SEQ.
"REAL PROPERTY" of any person shall mean all of the right, title and
interest of such person in and to land, improvements and fixtures, including
Leaseholds.
"RECEIVABLES SUBSIDIARY" shall mean Royal Appliance Receivables,
Inc., an Ohio corporation, so long as such corporation has in effect a
receivables program for the financing of receivables.
"REFERENCE BANKS" shall mean (i) NCB and (ii) any other Lender or
Lenders selected as a Reference Bank by the Administrative Agent and the
Required Lenders, PROVIDED, that if any of such Reference Banks is no longer a
Lender, such other Lender or Lenders as may be selected by the Administrative
Agent acting on instructions from the Required Lenders.
"REGULATION D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"REGULATION U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing margin requirements.
"REPORTABLE EVENT" shall mean an event described in section 4043 of
ERISA or the regulations thereunder with respect to a Plan, other than those
events as to which the notice requirement is waived under subsections .22, .23,
.25, .27, .28, .30, .31, .32, .34, .35, .63, .64, .65 or .67 of PBGC Regulation
section 4043.
"REQUIRED LENDERS" shall mean Non-Defaulting Lenders whose
outstanding Loans and Unutilized Commitments constitute more than 66+2/3% of the
sum of the total outstanding Loans and Unutilized Commitments of Non-Defaulting
Lenders (PROVIDED that, for purposes hereof, neither the Borrower, nor any of
its Affiliates, shall be included in (i) the Lenders holding such amount of the
Loans or having such amount of the Unutilized Commitments, or (ii) determining
the aggregate unpaid principal amount of the Loans or Unutilized Commitments).
"SALE AND LEASE-BACK TRANSACTION" shall mean any arrangement with any
person providing for the leasing by the Borrower or any Subsidiary of the
Borrower of any property (except for temporary leases for a term, including any
renewal thereof, of not more than one year and except for leases between the
Borrower and a Subsidiary or between Subsidiaries), which property has been or
is to be sold or transferred by the Borrower or such Subsidiary to such person.
"S&P" shall mean Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., and its successors.
"SEC" shall mean the United States Securities and Exchange
Commission.
"SEC REGULATION D" shall mean Regulation D as promulgated under the
Securities Act of 1933, as amended, as the same may be in effect from time to
time.
"SECTION 5.4(b)(II) CERTIFICATE" shall have the meaning provided in
section 5.4(b)(ii).
"SECURITY AGREEMENT" shall have the meaning provided in section
6.1(c).
"SECURITY DOCUMENTS" shall mean the Security Agreement and each other
document pursuant to which any Lien or security interest is granted by any
Credit Party to the Collateral Agent as security for any of the Obligations.
"STANDARD PERMITTED LIENS" shall mean the following:
(i) Liens for taxes not yet delinquent or Liens for taxes
being contested in good faith and by appropriate proceedings for
which adequate reserves (in the good faith judgment of the management
of the Borrower) have been established;
(ii) Liens in respect of property or assets imposed by law
which were incurred in the ordinary course
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of business, such as carriers', warehousemen's, materialmen's and
mechanics' Liens and other similar Liens arising in the ordinary
course of business, which do not in the aggregate materially detract
from the value of such property or assets or materially impair the
use thereof in the operation of the business of the Borrower or any
Subsidiary;
(iii) Liens created by this Agreement or the other Credit
Documents;
(iv) Liens (x) in existence on the Closing Date which are
listed, and the Indebtedness secured thereby and the property subject
thereto on the Closing Date described, in Annex IV, or (y) arising
out of the refinancing, extension, renewal or refunding of any
Indebtedness secured by any such Liens, PROVIDED that the principal
amount of such Indebtedness is not increased and such Indebtedness is
not secured by any additional assets;
(v) Liens arising from judgments, decrees or attachments
in circumstances not constituting an Event of Default under section
10.1(g);
(vi) Liens (other than any Lien imposed by ERISA) incurred
or deposits made in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of
social security; and mechanic's Liens, carrier's Liens, and other
Liens to secure the performance of tenders, statutory obligations,
contract bids, government contracts, performance and return-of-money
bonds and other similar obligations, incurred in the ordinary course
of business (exclusive of obligations in respect of the payment for
borrowed money), whether pursuant to statutory requirements, common
law or consensual arrangements;
(vii) Leases or subleases granted to others not
interfering in any material respect with the business of the Borrower
or any of its Subsidiaries and any interest or title of a lessor
under any lease not in violation of this Agreement;
(viii) easements, rights-of-way, zoning or deed
restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material
respect with the ordinary conduct of the business of the Borrower or
any of its Subsidiaries considered as an entirety; and
(ix) Liens arising from financing statements regarding
property subject to leases not in violation of the requirements of
this Agreement, PROVIDED that such Liens are only in respect of the
property subject to, and secure only, the respective lease (and any
other lease with the same or an affiliated lessor).
"STATED AMOUNT" of each Letter of Credit shall mean the maximum
available to be drawn thereunder (regardless of whether any conditions or other
requirements for drawing could then be met).
"SUBORDINATED INDEBTEDNESS" shall mean any Indebtedness which has
been subordinated to the Obligations in such manner and to such extent as the
Administrative Agent (acting on instructions from the Required Lenders) may
require.
"SUBSIDIARY" of any person shall mean and include (i) any corporation
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to "Subsidiary" shall mean a
Subsidiary of the Borrower.
"SUBSIDIARY GUARANTOR" shall mean any Subsidiary which is a party to
the Subsidiary Guaranty.
"SUBSIDIARY GUARANTY" shall have the meaning provided in section
8.10.
"TESTING PERIOD" shall mean for any determination a single period
consisting of the four consecutive fiscal quarters of the Borrower then last
ended (whether or not such quarters are all within the same fiscal year).
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"TOTAL COMMITMENT" shall mean the sum of the Commitments of the
Lenders.
"TYPE" shall mean any type of Loan determined with respect to the
interest option applicable thereto, I.E., a Prime Rate Loan or Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code.
"UNFUNDED CURRENT LIABILITY" of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
the Plan as of the close of its most recent plan year exceeds the fair market
value of the assets allocable thereto, each determined in accordance with
Statement of Financial Accounting Standards No. 87, based upon the actuarial
assumptions used by the Plan's actuary in the most recent annual valuation of
the Plan.
"UNITED STATES" and "U.S." each means United States of America.
"UNPAID DRAWING" shall have the meaning provided in section 3.3(a).
"UNUTILIZED COMMITMENT" for any Lender at any time shall mean the
excess of (i) such Lender's Commitment at such time over (ii) the sum of (x) the
principal amount of Loans made by such Lender and outstanding at such time plus
(y) such Lender's Percentage of Letter of Credit Outstandings at such time.
"UNUTILIZED TOTAL COMMITMENT" shall mean, at any time, the excess of
(i) the Total Commitment at such time over (ii) the sum of (x) the aggregate
principal amount of all Loans then outstanding plus (y) the aggregate Letter of
Credit Outstandings at such time.
"WHOLLY-OWNED SUBSIDIARY" shall mean each Subsidiary of the Borrower
at least 95% of whose capital stock, equity interests and partnership interests,
other than director's qualifying shares or similar interests, are owned directly
or indirectly by the Borrower.
"WRITTEN", "WRITTEN" or "IN WRITING" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.
1.2. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
1.3. ACCOUNTING TERMS. Except as otherwise specifically provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; PROVIDED that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision of section 8 or 9 hereof to eliminate the effect of
any change occurring after the Effective Date in GAAP or in the application
thereof to such provision (or if the Administrative Agent notifies the Borrower
that the Required Lenders request an amendment to any such provision hereof for
such purposes), regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance with the requirements of this
Agreement.
1.4. TERMS GENERALLY. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise, (a) any 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 or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any person shall be construed to include such person's successors and
assigns, (c) 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
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provision hereof, (d) all references herein to sections, Annexes and Exhibits
shall be construed to refer to sections of, and Annexes and Exhibits to, this
Agreement, and (e) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all real property, tangible
and intangible assets and properties, including cash, securities, accounts and
contract rights, and interests in any of the foregoing.
SECTION 2. AMOUNT AND TERMS OF LOANS.
2.1. COMMITMENTS FOR LOANS. Subject to and upon the terms and
conditions herein set forth, each Lender severally agrees to make a loan or
loans (each a "LOAN" and, collectively, the "LOANS") to the Borrower, which
Loans shall be drawn in accordance with the following provisions:
(a) Loans may be incurred by the Borrower at any time and
from time to time on and after the Closing Date and prior to the
Maturity Date;
(b) except as otherwise provided, Loans may, at the option
of the Borrower, be incurred and maintained as, or converted into,
Loans which are Prime Rate Loans or Eurodollar Loans, in each case
denominated in Dollars, PROVIDED that all Loans made as part of the
same Borrowing shall, unless otherwise specifically provided herein,
consist of Loans of the same Type;
(c) Loans may be repaid or prepaid and reborrowed in
accordance with the provisions hereof; and
(d) Loans made by any Lender shall not exceed for such
Lender at any time outstanding that aggregate principal amount which,
when added to the product at such time of (i) such Lender's
Percentage, TIMES (ii) the aggregate Letter of Credit Outstandings,
equals the Commitment of such Lender at such time.
2.2. MINIMUM BORROWING AMOUNTS, ETC.; PRO RATA BORROWINGS. (a) The
aggregate principal amount of each Borrowing by the Borrower shall not be less
than the Minimum Borrowing Amount. More than one Borrowing may be incurred by
the Borrower on any day, PROVIDED that (i) if there are two or more Borrowings
on a single day by the Borrower which consist of Eurodollar Loans, each such
Borrowing shall have a different initial Interest Period, and (ii) at no time
shall there be more than 5 Borrowings of Eurodollar Loans outstanding hereunder.
(b) All Borrowings shall be made by the Lenders PRO RATA on the basis
of their respective Commitments. It is understood that no Lender shall be
responsible for any default by any other Lender in its obligation to make Loans
hereunder and that each Lender shall be obligated to make the Loans provided to
be made by it hereunder, regardless of the failure of any other Lender to
fulfill its Commitment hereunder.
2.3. NOTICE OF BORROWING. (a) Whenever the Borrower desires to incur
Loans, it shall give the Administrative Agent at its Notice Office,
(A) BORROWINGS OF EURODOLLAR LOANS: prior to 12:00 noon
(local time at its Notice Office), at least three Business Days'
prior written or telephonic notice (in the case of telephonic notice,
promptly confirmed in writing if so requested by the Administrative
Agent) of each Borrowing of Eurodollar Loans to be made hereunder, or
(B) BORROWINGS OF PRIME RATE LOANS: prior to 12:00 noon
(local time at its Notice Office) on the proposed date thereof
written or telephonic notice (in the case of telephonic notice,
promptly confirmed in writing if so requested by the Administrative
Agent) of each Borrowing of Prime Rate Loans to be made hereunder.
Each such notice (each such notice, a "NOTICE OF BORROWING") shall (if requested
by the Administrative Agent to be confirmed in writing), be substantially in the
form of Exhibit B-1, and in any event shall be irrevocable and shall specify:
(i) the aggregate principal amount of the Loans to be made pursuant to such
Borrowing; (ii) the date of the Borrowing (which shall be a Business Day); (iii)
whether the Borrowing shall consist of Prime Rate Loans or Eurodollar Loans; and
(iv) if the
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requested Borrowing consists of Eurodollar Loans, the Interest Period to be
initially applicable thereto. The Administrative Agent shall promptly give each
Lender written notice (or telephonic notice promptly confirmed in writing) of
each proposed Borrowing, of such Lender's proportionate share thereof and of the
other matters covered by the Notice of Borrowing relating thereto.
(b) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may act prior to receipt of written confirmation without
liability upon the basis of such telephonic notice believed by the
Administrative Agent in good faith to be from an Authorized Officer of the
Borrower entitled to give telephonic notices under this Agreement on behalf of
the Borrower. In each such case, the Administrative Agent's record of the terms
of such telephonic notice shall be conclusive absent manifest error.
2.4. DISBURSEMENT OF FUNDS. (a) No later than 2:00 P.M. (local time
at the Payment Office) on the date specified in each Notice of Borrowing
relating to Eurodollar Loans, and no later than 2:00 P.M. (local time at the
Payment Office) on the date specified in each Notice of Borrowing relating to
Prime Rate Loans, each Lender will make available its PRO RATA share of each
Borrowing requested to be made on such date in the manner provided below. All
amounts shall be made available to the Administrative Agent in U.S. dollars and
immediately available funds at the Payment Office and the Administrative Agent
promptly will make available to the Borrower by depositing to its account at the
Payment Office the aggregate of the amounts so made available in the type of
funds received. Unless the Administrative Agent shall have been notified by any
Lender prior to the date of Borrowing that such Lender does not intend to make
available to the Administrative Agent its portion of the Borrowing or Borrowings
to be made on such date, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent on such date of
Borrowing, and the Administrative Agent, in reliance upon such assumption, may
(in its sole discretion and without any obligation to do so) make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Lender and the Administrative
Agent has made available same to the Borrower, the Administrative Agent shall be
entitled to recover such corresponding amount from such Lender. If such Lender
does not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent shall promptly notify the Borrower,
and the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from such Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (x) if paid by such Lender, the overnight Federal Funds
Effective Rate or (y) if paid by the Borrower, the then applicable rate of
interest, calculated in accordance with section 2.7, for the respective Loans
(but without any requirement to pay any amounts in respect thereof pursuant to
section 2.10).
(b) Nothing herein and no subsequent termination of the Commitments
pursuant to section 4.2 or 4.3 shall be deemed to relieve any Lender from its
obligation to fulfill its commitments hereunder and in existence from time to
time or to prejudice any rights which the Borrower may have against any Lender
as a result of any default by such Lender hereunder.
2.5. NOTES. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made to it by each Lender shall be evidenced by a
promissory note of the Borrower substantially in the form of Exhibit A (each a
"NOTE" and, collectively, the "NOTES").
(b) The Note issued by the Borrower to a Lender shall: (i) be
executed by the Borrower; (ii) be payable to the order of such Lender and be
dated on or prior to the date the first Loan outstanding thereunder is made;
(iii) be payable in the principal amount of Loans evidenced thereby; (iv) mature
on the Maturity Date; (v) bear interest as provided in section 2.7 in respect of
the Prime Rate Loans or Eurodollar Loans, as the case may be, evidenced thereby;
(vi) be subject to mandatory prepayment as provided in section 5.2; and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(c) Each Lender will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will, prior to any
transfer of its Note, endorse on the reverse side thereof or the grid attached
thereto the outstanding principal amount of Loans evidenced thereby. Failure to
make any such notation or any error in any such notation shall not affect the
Borrower's obligations in respect of such Loans.
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2.6. CONVERSIONS. The Borrower shall have the option to convert on
any Business Day all or a portion at least equal to the applicable Minimum
Borrowing Amount of the outstanding principal amount of its Loans of one Type
owing by it into a Borrowing or Borrowings of another Type of Loans which can be
made hereunder, PROVIDED that:
(a) no partial conversion of a Borrowing of Eurodollar
Loans shall reduce the outstanding principal amount of the Eurodollar
Loans made pursuant to such Borrowing to less than the Minimum
Borrowing Amount applicable thereto;
(b) any conversion of Eurodollar Loans into Prime Rate
Loans shall be made on, and only on, the last day of an Interest
Period for such Eurodollar Loans;
(c) Prime Rate Loans may only be converted into Eurodollar
Loans if no Default under section 10.1(a) or Event of Default is in
existence on the date of the conversion unless the Required Lenders
otherwise agree; and
(d) Borrowings of Eurodollar Loans resulting from this
section 2.6 shall conform to the requirements of section 2.2(a).
Each such conversion shall be effected by the Borrower giving the Administrative
Agent at its Notice Office, prior to 11:00 A.M. (local time at such Notice
Office), at least three Business Days' (or prior to 11:00 A.M. (local time at
such Notice Office) same Business Day's, in the case of a conversion into Prime
Rate Loans) prior written notice (or telephonic notice promptly confirmed in
writing if so requested by the Administrative Agent) (each a "NOTICE OF
CONVERSION"), substantially in the form of Exhibit B-2, specifying the Loans to
be so converted, the Type of Loans to be converted into and, if to be converted
into a Borrowing of Eurodollar Loans, the Interest Period to be initially
applicable thereto. The Administrative Agent shall give each Lender prompt
notice of any such proposed conversion affecting any of its Loans. For the
avoidance of doubt, the prepayment or repayment of any Loans out of the proceeds
of other Loans by the Borrower is not considered a conversion of Loans into
other Loans.
2.7. INTEREST. (a) INTEREST ON PRIME RATE LOANS. The unpaid principal
amount of each Loan which is a Prime Rate Loan shall bear interest from the date
of the Borrowing thereof until maturity (whether by acceleration or otherwise)
at a fluctuating rate per annum which shall at all times be equal to the Prime
Rate in effect from time to time.
(b) INTEREST ON EURODOLLAR LOANS. The unpaid principal amount of each
Loan which is a Eurodollar Loan shall bear interest from the date of the
Borrowing thereof until maturity (whether by acceleration or otherwise) at a
rate per annum which shall at all times be the Applicable Eurodollar Margin (as
defined below) for such Loan PLUS the relevant Eurodollar Rate.
(c) DEFAULT INTEREST. Notwithstanding the above provisions, if a
Default under section 10.1(a) or Event of Default is in existence, all
outstanding amounts of principal and, to the extent permitted by law, all
overdue interest, in respect of each Loan shall bear interest, payable on
demand, at a fluctuating rate per annum equal to 2% per annum above the rate
otherwise in effect from time to time with respect thereto pursuant to section
2.7(a) or (b). If any amount (other than the principal of and interest on the
Loans) payable by the Borrower under the Credit Documents is not paid when due,
such amount shall bear interest, payable on demand, at a fluctuating rate per
annum equal to 2% per annum above the rate in effect from time to time pursuant
to section 2.7(a).
(d) ACCRUAL AND PAYMENT OF INTEREST. Interest shall accrue from and
including the date of any Borrowing to but excluding the date of any prepayment
or repayment thereof and shall be payable (i) in respect of each Prime Rate
Loan, quarterly in arrears on the last Business Day of each March, June,
September and December, (ii) in respect of each Eurodollar Loan, on the last day
of each Interest Period applicable thereto and in the case of an Interest Period
in excess of three months, on the dates which are successively three months
after the commencement of such Interest Period, and (iii) in respect of each
Loan, on any prepayment or conversion (on the amount prepaid or converted), at
maturity (whether by acceleration or otherwise) and, after such maturity, on
demand.
(e) COMPUTATIONS OF INTEREST. All computations of interest hereunder
shall be made in accordance with
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section 12.7(b).
(f) INFORMATION AS TO RATES. Each Reference Bank agrees to furnish
the Administrative Agent timely information for the purpose of determining the
Eurodollar Rate for any Borrowing consisting of Eurodollar Loans. If any one or
more of the Reference Banks shall not timely furnish such information, the
Administrative Agent shall determine the Eurodollar Rate on the basis of timely
information furnished by the remaining Reference Banks. The Administrative Agent
upon determining the interest rate for any Borrowing shall promptly notify the
Borrower and the Lenders thereof.
(g) APPLICABLE EURODOLLAR MARGIN. As used herein, the term
"APPLICABLE EURODOLLAR MARGIN", as applied to any Loan which is a Eurodollar
Loan, means the particular rate per annum determined by the Administrative Agent
in accordance with the Pricing Grid Table which appears below, based on the
Borrower's ratio of Consolidated EBIT to Consolidated Interest Expense as
referred to in section 9.8 and such Pricing Grid Table, and the following
provisions:
(i) Initially, until changed hereunder in accordance with
the following provisions, the Applicable Eurodollar Margin will be
100 basis points per annum, UNLESS a different initial Applicable
Eurodollar Margin is determined by the Administrative Agent on the
basis of the certificate delivered pursuant to section 6.1(h).
(ii) Commencing with the fiscal quarter of the Borrower
ended on or nearest to June 30, 1998, and continuing with each fiscal
quarter thereafter, the Administrative Agent will determine the
Applicable Eurodollar Margin for any Loan in accordance with the
Pricing Grid Table, based on the Borrower's ratio of Consolidated
EBIT to Consolidated Interest Expense for the Testing Period ended
with such fiscal quarter, as referred to in section 9.8 and
identified in such Table. Changes in the Applicable Eurodollar Margin
based upon changes in such ratio shall become effective on the first
day of the month following the receipt by the Administrative Agent
pursuant to section 8.1(a) or (b) of the financial statements of the
Borrower, accompanied by the certificate and calculations referred to
in section 8.1(c), demonstrating the computation of such ratio, based
upon the ratio in effect at the end of the applicable period covered
(in whole or in part) by such financial statements.
(iii) Notwithstanding the above provisions, during any
period when (A) the Borrower has failed to timely deliver its
consolidated financial statements referred to in section 8.1(a) or
(b), accompanied by the certificate and calculations referred to in
section 8.1(c), (B) a Default under section 10.1(a) has occurred and
is continuing, or (C) an Event of Default has occurred and is
continuing, the Applicable Eurodollar Margin shall be the highest
rate per annum indicated therefor in the Pricing Grid Table,
regardless of the Borrower's ratio of Consolidated EBIT to
Consolidated Interest Expense at such time;
(iv) Any changes in the Applicable Eurodollar Margin shall
be determined by the Administrative Agent in accordance with the
above provisions and the Administrative Agent will promptly provide
notice of such determinations to the Borrower and the Lenders. Any
such determination by the Administrative Agent pursuant to this
section 2.7(g) shall be conclusive and binding absent manifest error.
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PRICING GRID TABLE
(EXPRESSED IN BASIS POINTS)
============================================================================================================
RATIO OF CONSOLIDATED EBIT Applicable Applicable
TO CONSOLIDATED INTEREST EXPENSE Eurodollar Margin Commitment Fee Rate
============================================================================================================
less than 4.00 to 1.00 175 25
------------------------------------------------------------------------------------------------------------
less than 8.00 to 1.00 but greater than or equal to 4.00 to 1.00 150 25
------------------------------------------------------------------------------------------------------------
less than 12.00 to 1.00 but greater than or equal to 8.00 to 1.00 125 25
------------------------------------------------------------------------------------------------------------
less than or equal to 12.00 to 1.00 100 20
============================================================================================================
2.8. INTEREST PERIODS. (a) At the time the Borrower gives a Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, a Borrowing of Eurodollar Loans (in the case of the initial Interest
Period applicable thereto) or prior to 11:00 A.M. (local time at the applicable
Notice Office) on the third Business Day prior to the expiration of an Interest
Period applicable to a Borrowing of Eurodollar Loans, it shall have the right to
elect by giving the Administrative Agent written or telephonic notice (in the
case of telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) of the Interest Period applicable to such Borrowing, which
Interest Period shall, at the option of the Borrower, be a one, two, three or
six month period. Notwithstanding anything to the contrary contained above:
(i) the initial Interest Period for any Borrowing of
Eurodollar Loans shall commence on the date of such Borrowing
(including the date of any conversion from a Borrowing of Prime Rate
Loans) and each Interest Period occurring thereafter in respect of
such Borrowing shall commence on the day on which the next preceding
Interest Period expires;
(ii) if any Interest Period begins on a day for which
there is no numerically corresponding day in the calendar month at
the end of such Interest Period, such Interest Period shall end on
the last Business Day of such calendar month;
(iii) if any Interest Period would otherwise expire on a
day which is not a Business Day, such Interest Period shall expire on
the next succeeding Business Day, PROVIDED that if any Interest
Period would otherwise expire on a day which is not a Business Day
but is a day of the month after which no further Business Day occurs
in such month, such Interest Period shall expire on the next
preceding Business Day;
(iv) no Interest Period for any Loan may be selected which
would end after the Maturity Date; and
(v) no Interest Period may be elected at any time when a
Default under section 10.1(a) or an Event of Default is then in
existence unless the Required Lenders otherwise agree.
(b) If upon the expiration of any Interest Period the Borrower has
failed to (or may not) elect a new Interest Period to be applicable to the
respective Borrowing of Eurodollar Loans as provided above, the Borrower shall
be deemed to have elected to convert such Borrowing to Prime Rate Loans
effective as of the expiration date of such current Interest Period.
2.9. INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that (x) in
the case of clause (i) below, the Administrative Agent or (y) in the case of
clauses (ii) and (iii) below, any Lender, shall have determined on a reasonable
basis
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(which determination shall, absent manifest error, be final and conclusive and
binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising after the
Effective Date affecting the interbank Eurodollar market, adequate
and fair means do not exist for ascertaining the applicable interest
rate on the basis provided for in the definition of Eurodollar Rate;
or
(ii) at any time, that such Lender shall incur increased
costs or reductions in the amounts received or receivable hereunder
in an amount which such Lender deems material with respect to any
Eurodollar Loans (other than any increased cost or reduction in the
amount received or receivable resulting from the imposition of or a
change in the rate of taxes or similar charges) because of (x) any
change since the Effective Date in any applicable law, governmental
rule, regulation, guideline, order or request (whether or not having
the force of law), or in the interpretation or administration thereof
and including the introduction of any new law or governmental rule,
regulation, guideline, order or request (such as, for example, but
not limited to, a change in official reserve requirements, but, in
all events, excluding reserves includable in the Eurodollar Rate
pursuant to the definition thereof) and/or (y) other circumstances
adversely affecting the interbank Eurodollar market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has become unlawful by compliance by such Lender in
good faith with any change since the Effective Date in any law,
governmental rule, regulation, guideline or order, or the official
interpretation or application thereof, or would conflict with any
thereof not having the force of law but with which such Lender
customarily complies or has become impracticable as a result of a
contingency occurring after the Effective Date which materially
adversely affects the interbank Eurodollar market;
THEN, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) above) shall (x) on or promptly following such date or time
and (y) within 10 Business Days of the date on which such event no longer exists
give notice (by telephone confirmed in writing) to the Borrower and to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x) in
the case of clause (i) above, Eurodollar Loans shall no longer be available
until such time as the Administrative Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice by the Administrative
Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given
by the Borrower with respect to Eurodollar Loans which have not yet been
incurred or converted shall be deemed rescinded by the Borrower or, in the case
of a Notice of Borrowing, shall, at the option of the Borrower, be deemed
converted into a Notice of Borrowing for Prime Rate Loans to be made on the date
of Borrowing contained in such Notice of Borrowing, (y) in the case of clause
(ii) above, the Borrower shall pay to such Lender, upon written demand therefor,
such additional amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Lender shall determine) as
shall be required to compensate such Lender, for such increased costs or
reductions in amounts receivable hereunder (a written notice as to the
additional amounts owed to such Lender, showing the basis for the calculation
thereof, which basis must be reasonable, submitted to the Borrower by such
Lender shall, absent manifest error, be final and conclusive and binding upon
all parties hereto) and (z) in the case of clause (iii) above, the Borrower
shall take one of the actions specified in section 2.9(b) as promptly as
possible and, in any event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in section 2.9(a)(ii) or (iii), the Borrower may (and in
the case of a Eurodollar Loan affected pursuant to section 2.9(a)(iii) the
Borrower shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, by giving the Administrative Agent telephonic notice
(confirmed promptly in writing) thereof on the same date that the Borrower was
notified by a Lender pursuant to section 2.9(a)(ii) or (iii), cancel said
Borrowing, convert the related Notice of Borrowing into one requesting a
Borrowing of Prime Rate Loans or require the affected Lender to make its
requested Loan as a Prime Rate Loan, or (ii) if the affected Eurodollar Loan is
then outstanding, upon at least one Business Day's notice to the Administrative
Agent, require the affected Lender to convert each such Eurodollar Loan into a
Prime Rate Loan, PROVIDED that if more than one Lender is affected at any time,
then all affected Lenders must be treated the same pursuant to this section
2.9(b).
(c) If any Lender shall have determined that after the Effective
Date, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged by law with the interpretation or administration
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thereof, or compliance by such Lender or its parent corporation with any request
or directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank, or comparable agency, in each case made
subsequent to the Effective Date, has or would have the effect of reducing by an
amount reasonably deemed by such Lender to be material the rate of return on
such Lender's or its parent corporation's capital or assets as a consequence of
such Lender's commitments or obligations hereunder to a level below that which
such Lender or its parent corporation could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender's or
its parent corporation's policies with respect to capital adequacy), then from
time to time, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or its parent corporation for
such reduction. Each Lender, upon determining in good faith that any additional
amounts will be payable pursuant to this section 2.9(c), will give prompt
written notice thereof to the Borrower, which notice shall set forth, in
reasonable detail, the basis of the calculation of such additional amounts,
which basis must be reasonable, although the failure to give any such notice
shall not release or diminish any of the Borrower's obligations to pay
additional amounts pursuant to this section 2.9(c) upon the subsequent receipt
of such notice.
(d) Notwithstanding anything in this Agreement to the contrary, (i)
no Lender shall be entitled to compensation or payment or reimbursement of other
amounts under section 2.9 or 3.5 for any amounts incurred or accruing more than
90 days prior to the giving of notice to the Borrower of additional costs or
other amounts of the nature described in such sections, and (ii) no Lender shall
demand compensation for any reduction referred to in section 2.9(c) or payment
or reimbursement of other amounts under section 3.5 if it shall not at the time
be the general policy or practice of such Lender to demand such compensation,
payment or reimbursement in similar circumstances under comparable provisions of
other credit agreements.
2.10. BREAKAGE COMPENSATION. The Borrower shall compensate each
applicable Lender, upon its written request (which request shall set forth the
detailed basis for requesting and the method of calculating such compensation),
for all reasonable losses, expenses and liabilities (including, without
limitation, any loss, expense or liability incurred by reason of the liquidation
or reemployment of deposits or other funds required by such Lender to fund its
Eurodollar Loans) which such Lender may sustain: (i) if for any reason (other
than a default by such Lender or the Administrative Agent) a Borrowing of
Eurodollar Loans does not occur on a date specified therefor in a Notice of
Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or
deemed withdrawn pursuant to section 2.9(a)); (ii) if any repayment, prepayment
or conversion of any of its Eurodollar Loans occurs on a date which is not the
last day of an Interest Period applicable thereto; (iii) if any prepayment of
any of its Eurodollar Loans is not made on any date specified in a notice of
prepayment given by the Borrower; or (iv) as a consequence of (x) any other
default by the Borrower to repay its Eurodollar Loans when required by the terms
of this Agreement or (y) an election made pursuant to section 2.9(b).
2.11. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS. (a) Each
Lender agrees that, upon the occurrence of any event giving rise to the
operation of section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to such
Lender, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Lender) to designate another Applicable
Lending Office for any Loans or Commitment affected by such event, PROVIDED that
such designation is made on such terms that such Lender and its Applicable
Lending Office suffer no economic, legal or regulatory disadvantage, with the
object of avoiding the consequence of the event giving rise to the operation of
any such section.
(b) If any Lender requests any compensation, reimbursement or other
payment under section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to such
Lender, or if any Lender is a Defaulting Lender, then the Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with the restrictions contained in section 12.4(b)), all its
interests, rights and obligations under this Agreement to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); PROVIDED that (i) the Borrower shall have received the
prior written consent of the Administrative Agent, which consent shall not be
unreasonably withheld, (ii) such Lender shall have received payment of an amount
equal to the outstanding principal of its Loans, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder, from the assignee
(to the extent of such outstanding principal and accrued interest and fees) or
the Borrower (in the case of all other amounts), and (iii) in the case of any
such assignment resulting from a claim for compensation, reimbursement or other
payments required to be made under section 2.9(a)(ii) or (iii), 2.9(c) or 3.5
with respect to such Lender, such assignment will result in a reduction in such
compensation, reimbursement or payments. A Lender shall not be required to make
any such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling
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the Borrower to require such assignment and delegation cease to apply.
(c) Nothing in this section 2.11 shall affect or postpone any of the
obligations of the Borrower or the right of any Lender provided in section 2.9
or 3.5.
SECTION 3. LETTERS OF CREDIT.
3.1. LETTERS OF CREDIT. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request a Letter of Credit Issuer
at any time and from time to time on or after the Closing Date and prior to the
date that is 15 Business Days prior to the Maturity Date to issue, for the
account of the Borrower or any of its Subsidiaries and in support of (i) trade
obligations of the Borrower and its Subsidiaries incurred in the ordinary course
of business, and/or (ii) worker compensation, liability insurance, releases of
contract retention obligations, contract performance guarantee requirements and
other bonding obligations of the Borrower or any such Subsidiary incurred in the
ordinary course of its business, and such other standby obligations of the
Borrower and its Subsidiaries that are acceptable to the Letter of Credit
Issuer, and subject to and upon the terms and conditions herein set forth, such
Letter of Credit Issuer agrees to issue from time to time, irrevocable
documentary or standby letters of credit denominated in Dollars in such form as
may be approved by such Letter of Credit Issuer and the Administrative Agent
(each such letter of credit (and each Existing Letter of Credit described in
section 3.1(d)), a "LETTER OF CREDIT" and collectively, the "LETTERS OF
CREDIT").
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings at such time, would exceed either (x) $10,000,000, or (y) when
added to the aggregate principal amount of all Loans then outstanding, an amount
equal to the Total Commitment at such time; (ii) no individual Letter of Credit
(other than any Existing Letter of Credit) shall be issued which has an initial
Stated Amount less than $100,000 unless such lesser Stated Amount is acceptable
to the Letter of Credit Issuer; and (iii) each Letter of Credit shall have an
expiry date (including any renewal periods) occurring not later than the earlier
of (A) one year from the date of issuance thereof, unless a longer period is
approved by the relevant Letter of Credit Issuer and Lenders (other than any
Defaulting Lender) holding a majority of the Total Commitment, and (B) 15
Business Days prior to the Maturity Date, in each case on terms acceptable to
the Administrative Agent and the relevant Letter of Credit Issuer.
(c) Notwithstanding the foregoing, in the event a Lender Default
exists, no Letter of Credit Issuer shall be required to issue any Letter of
Credit unless either (i) such Letter of Credit Issuer has entered into
arrangements satisfactory to it and the Borrower to eliminate such Letter of
Credit Issuer's risk with respect to the participation in Letters of Credit of
the Defaulting Lender or Lenders, including by cash collateralizing such
Defaulting Lender's or Lenders' Percentage of the Letter of Credit Outstandings;
or (ii) the issuance of such Letter of Credit, taking into account the potential
failure of the Defaulting Lender or Lenders to risk participate therein, will
not cause the Letter of Credit Issuer to incur aggregate credit exposure
hereunder with respect to Loans and Letter of Credit Outstandings in excess of
its Commitment, and the Borrower has undertaken, for the benefit of such Letter
of Credit Issuer, pursuant to an instrument satisfactory in form and substance
to such Letter of Credit Issuer, not to thereafter incur Loans or Letter of
Credit Outstandings hereunder which would cause the Letter of Credit Issuer to
incur aggregate credit exposure hereunder with respect to Loans and Letter of
Credit Outstandings in excess of its Commitment.
(d) Annex VI hereto contains a description of all letters of credit
outstanding on, and to continue in effect after, the Closing Date. Each such
letter of credit issued by a bank that is or becomes a Lender under this
Agreement on the Effective Date (each, an "EXISTING LETTER OF CREDIT") shall
constitute a "Letter of Credit" for all purposes of this Agreement, issued, for
purposes of section 3.4(a), on the Closing Date, and the Borrower, the
Administrative Agent and the applicable Lenders hereby agree that, from and
after such date, the terms of this Agreement shall apply to such Letters of
Credit, superseding any other agreement theretofore applicable to them to the
extent inconsistent with the terms hereof.
(e) No Letter of Credit Issuer shall issue any Letter of Credit, or
renew or extend or increase the amount of any previously issued Letter of
Credit, if at the time thereof the Administrative Agent and such Letter of
Credit Issuer shall have been notified by the Required Lenders in writing that
any of the conditions contained in this Agreement to such issuance, renewal,
extension or increase have not been satisfied, UNLESS such notice shall have
been withdrawn by the Required Lenders in a written instrument delivered to the
Administrative Agent and such Letter of Credit Issuer.
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3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE. (a) Whenever it
desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the Letter of Credit Issuer written or telephonic
notice (in the case of telephonic notice, promptly confirmed in writing if so
requested by the Administrative Agent) which, if in the form of written notice
shall be substantially in the form of Exhibit B-3, or transmit by electronic
communication (if arrangements for doing so have been approved by the Letter of
Credit Issuer), prior to 11:00 A.M. (local time at its Notice Office) at least
three Business Days (or such shorter period as may be acceptable to the relevant
Letter of Credit Issuer) prior to the proposed date of issuance (which shall be
a Business Day) (each a "LETTER OF CREDIT REQUEST"), which Letter of Credit
Request shall include such supporting documents that such Letter of Credit
Issuer customarily requires in connection therewith (including, in the case of a
Letter of Credit for an account party other than the Borrower, an application
for, and if applicable a reimbursement agreement with respect to, such Letter of
Credit). Any such documents executed in connection with the issuance of a Letter
of Credit, including the Letter of Credit itself, are herein referred to as
"LETTER OF CREDIT DOCUMENTS". In the event of any inconsistency between any of
the terms or provisions of any Letter of Credit Document and the terms and
provisions of this Agreement respecting Letters of Credit, the terms and
provisions of this Agreement shall control. The Administrative Agent shall
promptly notify each Lender of each Letter of Credit Request.
(b) Each Letter of Credit Issuer shall provide to the Administrative
Agent and each other Lender a quarterly (or monthly if requested by the
Administrative Agent or any applicable Lender) summary describing each Letter of
Credit issued by such Letter of Credit Issuer and then outstanding and an
identification for the relevant period of the daily aggregate Letter of Credit
Outstandings represented by Letters of Credit issued by such Letter of Credit
Issuer. Each Letter of Credit Issuer shall, if requested by the Administrative
Agent or any other Lender, provide a copy of each Letter of Credit issued by it.
3.3. AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. (a) The Borrower
hereby agrees to reimburse (or cause any Subsidiary for whose account a Letter
of Credit was issued to reimburse) each Letter of Credit Issuer, by making
payment directly to such Letter of Credit Issuer in immediately available funds
at the payment office of such Letter of Credit Issuer, for any payment or
disbursement made by such Letter of Credit Issuer under any Letter of Credit
(each such amount so paid or disbursed until reimbursed, an "UNPAID DRAWING")
not later than the Business Day immediately following the Business Day on which
such Letter of Credit Issuer notifies the Borrower (or any such Subsidiary for
whose account such Letter of Credit was issued) of such payment or disbursement
(which notice to the Borrower (or such Subsidiary) shall be delivered reasonably
promptly after any such payment or disbursement), such payment to be made in
Dollars, with interest on the amount so paid or disbursed by such Letter of
Credit Issuer, to the extent not reimbursed prior to 1:00 P.M. (local time at
the payment office of the Letter of Credit Issuer) on the date of such payment
or disbursement, from and including the date paid or disbursed to but not
including the date such Letter of Credit Issuer is reimbursed therefor at a rate
per annum which shall be the rate then applicable to Loans which are Prime Rate
Loans (plus an additional 2% per annum if not reimbursed by the third Business
Day after the date of such payment or disbursement), any such interest also to
be payable on demand. If by 11:00 A.M. on the Business Day immediately following
notice to it of its obligation to make reimbursement in respect of an Unpaid
Drawing, the Borrower has not made such reimbursement out of its available cash
on hand or a contemporaneous Borrowing hereunder, (x) the Borrower will be
deemed to have given a Notice of Borrowing for Prime Rate Loans in an aggregate
principal amount sufficient to reimburse such Unpaid Drawing (and the
Administrative Agent shall promptly give notice to the Lenders of such deemed
Notice of Borrowing), (y) the Lenders shall, unless they are legally prohibited
from doing so, make the Loans contemplated by such deemed Notice of Borrowing
(which Loans shall be considered made under section 2.1 hereof), and (z) the
proceeds of such Prime Rate Loans shall be disbursed directly to the applicable
Letter of Credit Issuer to the extent necessary to effect such reimbursement,
with any excess proceeds to be made available to the Borrower in accordance with
the applicable provisions of this Agreement.
(b) The Borrower's obligation under this section 3.3 to reimburse, or
cause a Subsidiary to reimburse, each Letter of Credit Issuer with respect to
Unpaid Drawings (including, in each case, interest thereon) shall be absolute
and unconditional under any and all circumstances and irrespective of any
setoff, counterclaim or defense to payment which the Borrower may have or have
had against such Letter of Credit Issuer, the Administrative Agent, any other
Letter of Credit Issuer or any Lender, including, without limitation, any
defense based upon the failure of any drawing under a Letter of Credit to
conform to the terms of the Letter of Credit or any non-application or
misapplication by the beneficiary of the proceeds of such drawing, PROVIDED,
HOWEVER that the Borrower shall not be obligated to reimburse, or cause a
Subsidiary to reimburse, a Letter of Credit Issuer for any wrongful payment made
by such Letter of Credit Issuer under a Letter of Credit as a result of acts or
omissions constituting willful misconduct or gross negligence on the part of
such Letter of Credit Issuer.
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3.4. LETTER OF CREDIT PARTICIPATIONS. (a) Immediately upon the
issuance by a Letter of Credit Issuer of any Letter of Credit (and on the
Closing Date with respect to any Existing Letter of Credit), such Letter of
Credit Issuer shall be deemed to have sold and transferred to each Lender with a
Commitment, and each such Lender (each a "PARTICIPANT") shall be deemed
irrevocably and unconditionally to have purchased and received from such Letter
of Credit Issuer, without recourse or warranty, an undivided interest and
participation, to the extent of such Lender's Percentage, in such Letter of
Credit, each substitute letter of credit, each drawing made thereunder, the
obligations of the Borrower under this Agreement with respect thereto (although
Letter of Credit Fees shall be payable directly to the Administrative Agent for
the account of the Lenders as provided in section 4.1(b) and the Participants
shall have no right to receive any portion of any fees of the nature
contemplated by section 4.1(c)), the obligations of any Subsidiary of the
Borrower under any Letter of Credit Documents pertaining thereto, and any
security for, or guaranty pertaining to, any of the foregoing. Upon any change
in the Commitments of the Lenders pursuant to section 12.4(b), it is hereby
agreed that, with respect to all outstanding Letters of Credit and Unpaid
Drawings, there shall be an automatic adjustment to the participations pursuant
to this section 3.4 to reflect the new Percentages of the assigning and assignee
Lender.
(b) In determining whether to pay under any Letter of Credit, a
Letter of Credit Issuer shall not have any obligation relative to the
Participants other than to determine that any documents required to be delivered
under such Letter of Credit have been delivered and that they appear to comply
on their face with the requirements of such Letter of Credit. Any action taken
or omitted to be taken by a Letter of Credit Issuer under or in connection with
any Letter of Credit if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create for such Letter of Credit Issuer any
resulting liability.
(c) In the event that a Letter of Credit Issuer makes any payment
under any Letter of Credit and the Borrower shall not have reimbursed (or caused
any applicable Subsidiary to reimburse) such amount in full to such Letter of
Credit Issuer pursuant to section 3.3(a), such Letter of Credit Issuer shall
promptly notify the Administrative Agent, and the Administrative Agent shall
promptly notify each Participant of such failure, and each Participant shall
promptly and unconditionally pay to the Administrative Agent for the account of
such Letter of Credit Issuer, the amount of such Participant's Percentage of
such payment in U.S. Dollars and in same day funds, PROVIDED, HOWEVER, that no
Participant shall be obligated to pay to the Administrative Agent its Percentage
of such unreimbursed amount for any wrongful payment made by such Letter of
Credit Issuer under a Letter of Credit as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of such Letter
of Credit Issuer. If the Administrative Agent so notifies any Participant
required to fund a payment under a Letter of Credit prior to 11:00 A.M. (local
time at its Notice Office) on any Business Day, such Participant shall make
available to the Administrative Agent for the account of the relevant Letter of
Credit Issuer such Participant's Percentage of the amount of such payment on
such Business Day in same day funds. If and to the extent such Participant shall
not have so made its Percentage of the amount of such payment available to the
Administrative Agent for the account of the relevant Letter of Credit Issuer,
such Participant agrees to pay to the Administrative Agent for the account of
such Letter of Credit Issuer, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent for the account of such Letter of Credit Issuer at
the Federal Funds Effective Rate. The failure of any Participant to make
available to the Administrative Agent for the account of the relevant Letter of
Credit Issuer its Percentage of any payment under any Letter of Credit shall not
relieve any other Participant of its obligation hereunder to make available to
the Administrative Agent for the account of such Letter of Credit Issuer its
Percentage of any payment under any Letter of Credit on the date required, as
specified above, but no Participant shall be responsible for the failure of any
other Participant to make available to the Administrative Agent for the account
of such Letter of Credit Issuer such other Participant's Percentage of any such
payment.
(d) Whenever a Letter of Credit Issuer receives a payment of a
reimbursement obligation as to which the Administrative Agent has received for
the account of such Letter of Credit Issuer any payments from the Participants
pursuant to section 3.4(c) above, such Letter of Credit Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its Percentage thereof, in U.S. dollars and in same
day funds, an amount equal to such Participant's Percentage of the principal
amount thereof and interest thereon accruing after the purchase of the
respective participations, as and to the extent so received.
(e) The obligations of the Participants to make payments to the
Administrative Agent for the account of each Letter of Credit Issuer with
respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of
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this Agreement under all circumstances, including, without limitation, any of
the following circumstances:
(i) any lack of validity or enforceability of this
Agreement or any of the other Credit Documents;
(ii) the existence of any claim, set-off defense or other
right which the Borrower (or any Subsidiary) may have at any time
against a beneficiary named in a Letter of Credit, any transferee of
any Letter of Credit (or any person for whom any such transferee may
be acting), the Administrative Agent, any Letter of Credit Issuer,
any Lender, or other person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein
or any unrelated transactions (including any underlying transaction
between the Borrower (or any Subsidiary) and the beneficiary named in
any such Letter of Credit), other than any claim which the Borrower
(or any Subsidiary which is the account party with respect to a
Letter of Credit) may have against any applicable Letter of Credit
Issuer for gross negligence or wilful misconduct of such Letter of
Credit Issuer in making payment under any applicable Letter of
Credit;
(iii) any draft, certificate or other document presented
under the Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue
or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents: or
(v) the occurrence of any Default or Event of Default.
(f) To the extent the Letter of Credit Issuer is not indemnified by
the Borrower, the Participants will reimburse and indemnify the Letter of Credit
Issuer, in proportion to their respective Percentages, for and against any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Letter of Credit Issuer
in performing its respective duties in any way related to or arising out of its
issuance of Letters of Credit, PROVIDED that no Participants shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
claims, actions, judgments, costs, expenses or disbursements resulting from the
Letter of Credit Issuer's gross negligence or willful misconduct.
3.5. INCREASED COSTS. If after the Effective Date, the adoption of
any applicable law, rule or regulation, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Letter of Credit Issuer or any
Lender with any request or directive (whether or not having the force of law) by
any such authority, central bank or comparable agency (in each case made
subsequent to the Effective Date) shall either (i) impose, modify or make
applicable any reserve, deposit, capital adequacy or similar requirement against
Letters of Credit issued by such Letter of Credit Issuer or such Lender's
participation therein, or (ii) shall impose on such Letter of Credit Issuer or
any Lender any other conditions affecting this Agreement, any Letter of Credit
or such Lender's participation therein; and the result of any of the foregoing
is to increase the cost to such Letter of Credit Issuer or such Lender of
issuing, maintaining or participating in any Letter of Credit, or to reduce the
amount of any sum received or receivable by such Letter of Credit Issuer or such
Lender hereunder (other than any increased cost or reduction in the amount
received or receivable resulting from the imposition of or a change in the rate
of taxes or similar charges), then, upon demand to the Borrower by such Letter
of Credit Issuer or such Lender (a copy of which notice shall be sent by such
Letter of Credit Issuer or such Lender to the Administrative Agent), the
Borrower shall pay to such Letter of Credit Issuer or such Lender such
additional amount or amounts as will compensate any such Letter of Credit Issuer
or such Lender for such increased cost or reduction. A certificate submitted to
the Borrower by any Letter of Credit Issuer or any Lender, as the case may be (a
copy of which certificate shall be sent by such Letter of Credit Issuer or such
Lender to the Administrative Agent), setting forth, in reasonable detail, the
basis for the determination of such additional amount or amounts necessary to
compensate any Letter of Credit Issuer or such Lender as aforesaid shall be
conclusive and binding on the Borrower absent manifest error, although the
failure to deliver any such certificate shall not release or diminish any of the
Borrower's obligations to pay additional amounts pursuant to this section 3.5.
Reference is hereby made to the provisions of sections 2.9(d) and 2.11 for
certain limitations upon the rights of a Letter of Credit Issuer or Lender under
this section.
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3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS. (a) The
Borrower hereby unconditionally guarantees, for the benefit of the
Administrative Agent and the Lenders, the full and punctual payment of the
Obligations of each Subsidiary under each Letter of Credit Document to which
such Subsidiary is now or hereafter becomes a party. Upon failure by any such
Subsidiary to pay punctually any such amount, the Borrower shall forthwith on
demand by the Administrative Agent pay the amount not so paid at the place and
in the currency and otherwise in the manner specified in this Agreement or any
applicable Letter of Credit Document.
(b) As a separate, additional and continuing obligation, the Borrower
unconditionally and irrevocably undertakes and agrees, for the benefit of the
Administrative Agent and the Lenders, that, should any amounts not be
recoverable from the Borrower under section 3.6(a) for any reason whatsoever
(including, without limitation, by reason of any provision of any Credit
Document or any other agreement or instrument executed in connection therewith
being or becoming void, unenforceable, or otherwise invalid under any applicable
law) then, notwithstanding any notice or knowledge thereof by any Lender, the
Administrative Agent, any of their respective Affiliates, or any other person,
at any time, the Borrower as sole, original and independent obligor, upon demand
by the Administrative Agent, will make payment to the Administrative Agent, for
the account of the Lenders and the Administrative Agent, of all such obligations
not so recoverable by way of full indemnity, in such currency and otherwise in
such manner as is provided in the Credit Documents.
(c) The obligations of the Borrower under this section shall be
unconditional and absolute and, without limiting the generality of the foregoing
shall not be released, discharged or otherwise affected by the occurrence, one
or more times, of any of the following:
(i) any extension, renewal, settlement, compromise, waiver
or release in respect to any obligation of any Subsidiary under any
Letter of Credit Document, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to this
Agreement, any Note or any other Credit Document;
(iii) any release, non-perfection or invalidity of any
direct or indirect security for any obligation of the Borrower under
this Agreement, any Note or any other Credit Document or of any
Subsidiary under any Letter of Credit Document;
(iv) any change in the corporate existence, structure or
ownership of any Subsidiary or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any Subsidiary
or its assets or any resulting release or discharge of any obligation
of any Subsidiary contained in any Letter of Credit Document;
(v) the existence of any claim, set-off or other rights
which the Borrower may have at any time against any Subsidiary, the
Administrative Agent, any Lender or any other person, whether in
connection herewith or any unrelated transactions;
(vi) any invalidity or unenforceability relating to or
against any Subsidiary for any reason of any Letter of Credit
Document, or any provision of applicable law or regulation purporting
to prohibit the payment by any Subsidiary of any Obligations in
respect of any Letter of Credit; or
(vii) any other act or omission to act or delay of any kind
by any Subsidiary, the Administrative Agent, any Lender or any other
person or any other circumstance whatsoever which might, but for the
provisions of this section, constitute a legal or equitable discharge
of the Borrower's obligations under this section.
(d) The Borrower's obligations under this section shall remain in
full force and effect until the Commitments shall have terminated and the
principal of and interest on the Notes and all other amounts payable by the
Borrower under the Credit Documents and by any Subsidiary under the Letter of
Credit Documents shall have been paid in full. If at any time any payment of any
of the Obligations of any Subsidiary in respect of any Letter of Credit
Documents is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of such Subsidiary, the Borrower's
obligations under this section with respect to such payment shall be reinstated
at such time as though such payment had been due but not made at such time.
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(e) The Borrower irrevocably waives acceptance hereof, presentment,
demand, protest and any notice not provided for herein, as well as any
requirement that at any time any action be taken by any person against any
Subsidiary or any other person, or against any collateral or guaranty of any
other person.
(f) The Borrower hereby subordinates all rights, whether arising by
operation of law or otherwise, which it may have upon making any payment under
this section to be subrogated to the rights of the payee against any Subsidiary
with respect to such payment or otherwise to be reimbursed, indemnified or
exonerated by any Subsidiary in respect thereof, to the indefeasible payment in
full of all of the Obligations.
(g) In the event that acceleration of the time for payment of any
amount payable by any Subsidiary under any Letter of Credit Document is stayed
upon insolvency, bankruptcy or reorganization of such Subsidiary, all such
amounts otherwise subject to acceleration under the terms of any applicable
Letter of Credit Document shall nonetheless be payable by the Borrower under
this section forthwith on demand by the Administrative Agent.
SECTION 4. FEES; COMMITMENTS.
4.1. FEES. (a) The Borrower agrees to pay to the Administrative Agent
a commitment fee (the "COMMITMENT FEE") for the account of each Non-Defaulting
Lender for the period from and including the Effective Date to, but not
including, the Maturity Date or, if earlier, the date upon which the Total
Commitment has been terminated, computed for each day at a rate per annum equal
to the Applicable Commitment Fee Rate for such day on such Lender's Unutilized
Commitment for such day. The Commitment Fee shall be due and payable in arrears
on the last Business Day of each June, September, December and March and on the
Maturity Date or, if earlier, the date upon which the Total Commitment has been
terminated.
As used herein, the term "APPLICABLE COMMITMENT FEE RATE" means the
particular rate per annum determined by the Administrative Agent in accordance
with the Pricing Grid Table which appears in section 2.7(g), based on the
Borrower's ratio of Consolidated EBIT to Consolidated Interest Expense as
referred to in section 9.8 and such Pricing Grid Table, and the following
provisions:
(i) Initially, until changed hereunder in accordance with
the following provisions, the Applicable Commitment Fee Rate will be
20 basis points per annum, UNLESS a different initial Applicable
Commitment Fee Rate is determined by the Administrative Agent on the
basis of the certificate delivered pursuant to section 6.1(h).
(ii) Commencing with the fiscal quarter of the Borrower
ended on or nearest to June 30, 1998, and continuing with each fiscal
quarter thereafter, the Administrative Agent will determine the
Applicable Commitment Fee Rate in accordance with the Pricing Grid
Table, based on the Borrower's ratio of Consolidated EBIT to
Consolidated Interest Expense for the Testing Period ended with such
fiscal quarter, as referred to in section 9.8 and identified in such
Table. Changes in the Applicable Commitment Fee Rate based upon
changes in such ratio shall become effective on the first day of the
month following the receipt by the Administrative Agent pursuant to
section 8.1(a) or (b) of the financial statements of the Borrower,
accompanied by the certificate and calculations referred to in
section 8.1(c), demonstrating the computation of such ratio, based
upon the ratio in effect at the end of the applicable period covered
(in whole or in part) by such financial statements.
(iii) Notwithstanding the above provisions, during any
period when (A) the Borrower has failed to timely deliver its
consolidated financial statements referred to in section 8.1(a) or
(b), accompanied by the certificate and calculations referred to in
section 8.1(c), (B) a Default under section 10.1(a) has occurred and
is continuing, or (C) an Event of Default has occurred and is
continuing, the Applicable Commitment Fee Rate shall be the highest
rate per annum indicated therefor in the Pricing Grid Table,
regardless of the Borrower's ratio of Consolidated EBIT to
Consolidated Interest Expense at such time;
(iv) Any changes in the Applicable Commitment Fee Rate
shall be determined by the Administrative Agent in accordance with
the above provisions and the Administrative Agent will promptly
provide notice of such determinations to the Borrower and the
Lenders. Any such determination by the Administrative Agent pursuant
to this section 4.1(a) shall be conclusive and binding absent
manifest error.
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(b) The Borrower agrees to pay to the Administrative Agent, for the
account of each Non-Defaulting Lender, PRO RATA on the basis of its Percentage,
a fee in respect of each Letter of Credit (the "LETTER OF CREDIT FEE"), payable
on the date of issuance (or any increase in the amount, or renewal or extension)
thereof, computed at the rate per annum equal to the Applicable Eurodollar
Margin then in effect on the Stated Amount thereof for the period from the date
of issuance (or increase, renewal or extension) to the expiration date thereof
(including any extensions of such expiration date which may be made at the
election of the beneficiary thereof). Notwithstanding the above provisions, if a
Default under section 10.1(a) or Event of Default is in existence, the Borrower
will pay to the Administrative Agent, on demand, for the account of each
Non-Defaulting Lender, PRO RATA on the basis of its Percentage, an additional
Letter of Credit Fee, computed at 2% per annum on the Stated Amount of each
Letter of Credit for the period such Default or Event of Default is in
existence.
(c) The Borrower agrees to pay directly to each Letter of Credit
Issuer upon each issuance of, drawing under, and/or amendment, extension,
renewal or transfer of, a Letter of Credit issued by it such amount as shall at
the time of such issuance, drawing, amendment, extension, renewal or transfer be
the administrative or processing charge which such Letter of Credit Issuer is
customarily charging for issuances of, drawings under or amendments, extensions,
renewals or transfers of, letters of credit issued by it.
(d) All computations of Fees shall be made in accordance with section
12.7(b).
(e) The Borrower shall pay to the Administrative Agent on the
Effective Date and thereafter for its own account and/or for distribution to the
Lenders such fees as heretofore agreed by the Borrower and the Administrative
Agent.
4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS. Upon at least
three Business Days' prior written notice (or telephonic notice confirmed in
writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Lenders), the
Borrower shall have the right, without premium or penalty, to:
(a) terminate the Total Commitment, PROVIDED that (i) all
outstanding Loans are contemporaneously prepaid in accordance with
section 5.1, and (ii) either (A) no Letters of Credit remain
outstanding, or (B) the Borrower shall contemporaneously either (x)
cause all outstanding Letters of Credit to be surrendered for
cancellation (any such Letters of Credit to be replaced by letters of
credit issued by other financial institutions acceptable to the
Required Lenders), or (y) the Borrower shall pay to the
Administrative Agent an amount in cash and/or Cash Equivalents equal
to 100% of the Letter of Credit Outstandings and the Administrative
Agent shall hold such payment as security for the reimbursement
obligations of the Borrower hereunder in respect of Letters of Credit
pursuant to a cash collateral agreement to be entered into in form
and substance reasonably satisfactory to the Administrative Agent and
the Borrower (which shall permit certain investments in Cash
Equivalents satisfactory to the Administrative Agent and the Borrower
until the proceeds are applied to the secured obligations); and/or
(b) partially and permanently reduce the Unutilized Total
Commitment, PROVIDED that (i) any such reduction shall apply to
proportionately and permanently reduce the Commitment of each of the
Lenders; and (ii) any partial reduction of the Unutilized Total
Commitment pursuant to this section 4.2(b) shall be in the amount of
at least $5,000,000 (or, if greater, in integral multiples of
$1,000,000).
4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC. (a) The
Total Commitment (and the Commitment of each Lender) shall terminate on June 15,
1998, unless the Closing Date has occurred on or prior to such date.
(b) The Total Commitment shall terminate (and the Commitment of each
Lender shall terminate) on the earlier of (x) the Maturity Date and (y) the date
on which a Change of Control occurs.
(c) The Total Commitment shall be permanently reduced, without
premium or penalty, at the time that any mandatory prepayment of Loans would be
made pursuant to section 5.2(b) or (c) if Loans were then outstanding in the
full amount of the Total Commitment then in effect, in an amount equal to the
required prepayment of principal of Loans which would be required to be made in
such circumstance. Any such reduction shall apply to proportionately and
permanently reduce the Commitment of each of the Lenders. The Borrower will
provide at least three Business Days' prior written notice (or
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telephonic notice confirmed in writing) to the Administrative Agent at its
Notice Office (which notice the Administrative Agent shall promptly transmit to
each of the Lenders), of any reduction of the Total Commitment pursuant to this
section 4.3(c), specifying the date and amount of the reduction.
4.4. EXTENSION OF MATURITY DATE. At any time after January 1, 2000,
and during the 30 day period following delivery by the Borrower pursuant to
section 8.1(a) of its consolidated financial statements for its fiscal year then
most recently ended, and annually thereafter during the 30 day period following
delivery by the Borrower of its consolidated financial statements pursuant to
section 8.1(a), the Borrower may request the Administrative Agent to determine
if all of the Lenders are then willing to extend the Maturity Date for a single
additional year. If the Borrower so requests, the Administrative Agent will so
advise the Lenders. If all of the Lenders in their sole discretion are all
willing to so extend the Maturity Date, after taking into account such
considerations as any Lender may deem relevant, the Borrower, the Administrative
Agent and all of the Lenders shall execute and deliver a definitive written
instrument so extending the Maturity Date. No such extension of the Maturity
Date shall be valid or effective for any purpose unless such definitive written
instrument is so signed and delivered within 60 days following the giving by the
Administrative Agent of notice to the Lenders that the Borrower has requested
such an extension.
SECTION 5. PAYMENTS.
5.1. VOLUNTARY PREPAYMENTS. The Borrower shall have the right to
prepay any of its Loans, in whole or in part, without premium or penalty, from
time to time, but only on the following terms and conditions:
(i) the Borrower shall give the Administrative Agent at the
Notice Office written or telephonic notice (in the case of telephonic
notice, promptly confirmed in writing if so requested by the
Administrative Agent) of its intent to prepay the Loans, the amount
of such prepayment and (in the case of Eurodollar Loans) the specific
Borrowing(s) pursuant to which made, which notice shall be received
by the Administrative Agent by
(x) 12:00 noon (local time at the Notice Office)
three Business Days prior to the date of such prepayment,
in the case of any prepayment of Eurodollar Loans, or
(y) 12:00 noon (local time at the Notice Office)
on the date of such prepayment, in the case of any
prepayment of Prime Rate Loans,
and which notice shall promptly be transmitted by the Administrative
Agent to each of the affected Lenders;
(ii) each partial prepayment by the Borrower of any
Borrowing shall be in an aggregate principal amount of (A) at least
$500,000, or an integral multiple of $100,000 in excess thereof, in
the case of Loans which are Prime Rate Loans, or (B) at least
$1,000,000, or an integral multiple of $500,000 in excess thereof, in
the case of Loans which are Eurodollar Loans;
(iii) no partial prepayment of Eurodollar Loans of the
Borrower made pursuant to a Borrowing shall reduce the aggregate
principal amount of the Eurodollar Loans outstanding pursuant to such
Borrowing to an amount less than the Minimum Borrowing Amount
applicable thereto;
(iv) each prepayment in respect of any Loans made pursuant
to a Borrowing shall be applied PRO RATA among such Loans; and
(v) each prepayment of Eurodollar Loans pursuant to this
section 5.1 on any date other than the last day of the Interest
Period applicable thereto shall be accompanied by any amounts payable
in respect thereof under section 2.10.
5.2. MANDATORY PREPAYMENTS. The Loans shall be subject to mandatory
prepayment in accordance with the following provisions:
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(a) IF OUTSTANDING LOANS AND LETTER OF CREDIT OUTSTANDINGS
EXCEED TOTAL COMMITMENT. If on any date (after giving effect to any
other payments on such date) the sum of (i) the aggregate outstanding
principal amount of Loans PLUS (ii) the aggregate amount of Letter of
Credit Outstandings, exceeds the Total Commitment as then in effect,
the Borrower shall prepay on such date that principal amount of Loans
and, after Loans have been paid in full, Unpaid Drawings, in an
aggregate amount at least equal to such excess and conforming in the
case of partial prepayments of Loans to the requirements as to the
amounts of partial prepayments of Loans which are contained in
section 5.1. If, after giving effect to the prepayment of Loans and
Unpaid Drawings, the aggregate amount of Letter of Credit
Outstandings exceeds the Total Commitment as then in effect, the
Borrower shall pay to the Administrative Agent an amount in cash
and/or Cash Equivalents equal to such excess and the Administrative
Agent shall hold such payment as security for the reimbursement
obligations of the Borrower hereunder in respect of Letters of Credit
pursuant to a cash collateral agreement to be entered into in form
and substance reasonably satisfactory to the Administrative Agent and
the Borrower (which shall permit certain investments in Cash
Equivalents satisfactory to the Administrative Agent and the Borrower
until the proceeds are applied to the secured obligations).
(b) CERTAIN PROCEEDS OF ASSET SALES. If during any fiscal
year of the Borrower, the Borrower and its Subsidiaries have received
cumulative Cash Proceeds during such fiscal year from one or more
Asset Sales of at least $3,000,000, exclusive of any Asset Sale
involving only the sale of the Borrower's Xxxxxxx Road facility,
including land, improvements and associated property, THEN not later
than the third Business Day following the date of receipt of any Cash
Proceeds in excess of such amount, an amount, conforming to the
requirements as to the amount of partial prepayments contained in
section 5.1, at least equal to 100% of the Net Cash Proceeds then
received in excess of such amount from any such Asset Sale, shall be
applied as a mandatory prepayment of principal of the outstanding
Loans; PROVIDED, that (i) if no Default under section 10.1(a) or
Event of Default shall have occurred and be continuing, (ii) the
Borrower and its Subsidiaries have scheduled Consolidated Capital
Expenditures during the following 12 months, and (iii) the Borrower
notifies the Administrative Agent of the amount and nature thereof
and of its intention to reinvest all or a portion of such Net Cash
Proceeds in such Consolidated Capital Expenditures during such 12
month period, then no such prepayment shall be required to the extent
of the amount which the Borrower so indicates will be so reinvested.
If at the end of any such 12 month period any portion of such Net
Cash Proceeds has not been so reinvested, the Borrower will
immediately make a prepayment of the outstanding Loans as provided
above in an amount, conforming to the requirements as to amount of
prepayments contained in section 5.1, at least equal to such
remaining amount.
(c) CHANGE OF CONTROL. On the date of which a Change of
Control occurs, notwithstanding anything to the contrary contained in
this Agreement, no further Borrowings shall be made and the then
outstanding principal amount of all Loans, if any, shall become due
and payable and shall be prepaid in full, and the Borrower shall
contemporaneously either (i) cause all outstanding Letters of Credit
to be surrendered for cancellation (any such Letters of Credit to be
replaced by letters of credit issued by other financial institutions
acceptable to the Required Lenders), or (ii) the Borrower shall pay
to the Administrative Agent an amount in cash and/or Cash Equivalents
equal to 100% of the Letter of Credit Outstandings and the
Administrative Agent shall hold such payment as security for the
reimbursement obligations of the Borrower hereunder in respect of
Letters of Credit pursuant to a cash collateral agreement to be
entered into in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower (which shall permit certain
investments in Cash Equivalents satisfactory to the Administrative
Agent and the Borrower until the proceeds are applied to the secured
obligations).
(d) PARTICULAR LOANS TO BE PREPAID. With respect to each
repayment or prepayment of Loans required by this section 5.2, the
Borrower shall designate the Types of Loans which are to be prepaid
and the specific Borrowing(s) pursuant to which such repayment or
prepayment is to be made, PROVIDED that (i) the Borrower shall first
so designate all Loans that are Prime Rate Loans and Eurodollar Loans
with Interest Periods ending on the date of repayment or prepayment
prior to designating any other Eurodollar Loans for repayment or
prepayment, (ii) if the outstanding principal amount of Eurodollar
Loans made pursuant to a Borrowing is reduced below the applicable
Minimum Borrowing Amount as a result of any such repayment or
prepayment, then all the Loans outstanding pursuant to such Borrowing
shall be converted into Prime Rate Loans, and (iii) each repayment
and prepayment of any Loans made pursuant to a Borrowing shall be
applied PRO RATA among such Loans. In the absence of a designation by
the Borrower as described in the preceding sentence, the
Administrative Agent shall,
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subject to the above, make such designation in its sole discretion
with a view, but no obligation, to minimize breakage costs owing
under section 2.10. Any repayment or prepayment of Eurodollar Loans
pursuant to this section 5.2 shall in all events be accompanied by
such compensation as is required by section 2.10.
5.3. METHOD AND PLACE OF PAYMENT. Except as otherwise specifically
provided herein, all payments under this Agreement shall be made to the
Administrative Agent for the ratable (based on its PRO RATA share) account of
the Lenders entitled thereto, not later than 12:00 noon (local time at the
Payment Office) on the date when due and shall be made in immediately available
funds and in lawful money of the United States of America at the Payment Office,
it being understood that written notice by the Borrower to the Administrative
Agent to make a payment from the funds in the Borrower's account at the Payment
Office shall constitute the making of such payment to the extent of such funds
held in such account. Any payments under this Agreement which are made later
than 12:00 noon (local time at the Payment Office) shall be deemed to have been
made on the next succeeding Business Day. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, the
due date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate in effect immediately prior to such extension.
5.4. NET PAYMENTS. (a) All payments made by the Borrower hereunder,
under any Note or any other Credit Document, will be made without setoff,
counterclaim or other defense. Except as provided for in section 5.4(c), all
such payments will be made free and clear of, and without deduction or
withholding for, any present or future United States withholding taxes. The
Borrower will furnish to the Administrative Agent within 45 days after the date
of any withholding or deduction on account of United States withholding taxes
certified copies of tax receipts, or other evidence satisfactory to the Lender,
evidencing such payment by the Borrower.
(b) Each Lender that is not a United States person (as such term is
defined in section 7701(a)(30) of the Code) for Federal income tax purposes
agrees to provide to the Borrower and the Administrative Agent on or prior to
the Effective Date, or in the cases of a Lender that is an assignee or
transferee of an interest under this Agreement pursuant to section 12.4 (unless
the respective Lender was already a Lender hereunder immediately prior to such
assignment or transfer and such Lender is in compliance with the provisions of
this section 5.4(b)), on the date of such assignment or transfer to such Lender,
(i) two accurate and complete original signed copies of Internal Revenue Service
Form 4224 or 1001 (or successor forms) certifying to such Lender's entitlement
to a complete exemption from United States withholding tax with respect to
payments to be made under this Agreement, any Note or any other Credit Document,
or (ii) if the Lender is not a "bank" within the meaning of section 881(c)(3)(A)
of the Code and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit G (any such certificate, a "SECTION 5.4(B)(II) CERTIFICATE") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Lender's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement, any Note or any other Credit Document.
In addition, each Lender agrees that from time to time after the Effective Date,
when a lapse in time or change in circumstances renders the previous
certification obsolete or inaccurate in any material respect, it will deliver to
the Borrower and the Administrative Agent two new accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001, or Form W-8 and a
Section 5.4(b)(ii) Certificate, as the case may be, and such other forms as may
be required in order to confirm or establish the entitlement of such Lender to a
continued exemption from or reduction in United States withholding tax with
respect to payments under this Agreement, any Note or any other Credit Document,
or it shall immediately notify the Borrower and the Administrative Agent of its
inability to deliver any such Form or Certificate, in which case such Lender
shall not be required to deliver any such Form or Certificate pursuant to this
section 5.4(b).
(c) Notwithstanding anything to the contrary contained in section
5.4(a), the Borrower shall be entitled, to the extent it is required to do so by
law, to deduct or withhold income or other similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, fees or other amounts payable hereunder for the account of any
Lender which is not a United States person (as such term is defined in section
7701(a)(30) of the Code) for United States federal income tax purposes and which
has not provided to the Borrower such forms that establish a complete exemption
from such deduction or withholding (i) if such Lender has not provided to the
Borrower the Internal Revenue Service forms required to be provided to the
Borrower pursuant to section 5.4(b), or (ii) in the case of a payment other than
interest, to a Lender described in clause (ii) of section 5.2(b) above, to the
extent that such forms do not establish a complete exemption from withholding of
such taxes.
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SECTION 6. CONDITIONS PRECEDENT.
6.1. CONDITIONS PRECEDENT AT CLOSING DATE. The obligation of the
Lenders to make Loans, and of any Letter of Credit Issuer to issue Letters of
Credit, is subject to the satisfaction of each of the following conditions on
the Closing Date:
(a) EFFECTIVENESS; NOTES. On or prior to the Closing Date,
(i) the Effective Date shall have occurred and (ii) there shall have
been delivered to the Administrative Agent for the account of each
Lender the appropriate Note or Notes executed by the Borrower, in
each case, in the amount, maturity and as otherwise provided herein.
(b) FEES, ETC. The Borrower shall have paid or caused to be
paid all fees required to be paid by it on or prior to such date
pursuant to section 4.1 hereof and all reasonable fees and expenses
of the Administrative Agent and of special counsel to the
Administrative Agent which have been invoiced on or prior to such
date in connection with the preparation, execution and delivery of
this Agreement and the other Credit Documents and the consummation of
the transactions contemplated hereby and thereby.
(c) OTHER CREDIT DOCUMENTS. The Borrower shall have duly
executed and delivered and there shall be in full force and effect,
and original counterparts shall have been delivered to the
Administrative Agent, in sufficient quantities for the Administrative
Agent and the Lenders, of, the Security Agreement (as modified,
amended or supplemented from time to time in accordance with the
terms thereof and hereof, the "SECURITY AGREEMENT"), substantially in
the form attached hereto as Exhibit C.
(d) CORPORATE RESOLUTIONS AND APPROVALS. The Administrative
Agent shall have received, in sufficient quantity for the
Administrative Agent and the Lenders, certified copies of the
resolutions of the Board of Directors of the Borrower, approving the
Credit Documents to which the Borrower is or may become a party, and
of all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect to the execution,
delivery and performance by the Borrower of the Credit Documents to
which it is or may become a party.
(e) INCUMBENCY CERTIFICATE. The Administrative Agent shall
have received, in sufficient quantity for the Administrative Agent
and the Lenders, a certificate of the Secretary or an Assistant
Secretary of the Borrower, certifying the names and true signatures
of the officers of the Borrower authorized to sign the Credit
Documents to which the Borrower is a party and any other documents to
which the Borrower is a party which may be executed and delivered in
connection herewith.
(f) OPINION OF COUNSEL. On the Closing Date, the
Administrative Agent shall have received an opinion, addressed to the
Administrative Agent and each of the Lenders and dated the Closing
Date, from Kahn, Kleinman, Xxxxxxxx & Xxxxxx, special counsel to the
Borrower, substantially in the form of Exhibit E hereto and covering
such other matters incident to the transactions contemplated hereby
as the Administrative Agent may reasonably request, such opinion to
be in form and substance satisfactory to the Administrative Agent.
(g) EXISTING CREDIT AGREEMENT. The Borrower shall have
terminated the commitments of the lenders under the existing
financing arrangements with National City Commercial Finance, Inc.
(or any of its Affiliates), shall have prepaid all borrowings
thereunder, shall have made effective provision satisfactory to the
Administrative Agent for the termination, or assignment to the
Collateral Agent, of the liens and security thereunder, and if
required in connection with such termination, made effective
provision for any letters of credit issued thereunder to be supported
or replaced by Letters of Credit issued hereunder.
(h) FINANCIAL CERTIFICATE. The Borrower shall have
delivered to the Administrative Agent, in sufficient quantities for
the Lenders, a certificate of a responsible financial or accounting
officer of the Borrower, containing calculations, in reasonable
detail, as to the computation of the Borrower's ratio of Consolidated
EBIT to Consolidated Interest Expense for the most recent Testing
Period for which financial information has been furnished to the
Lenders hereunder.
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(i) RECORDATION OF SECURITY DOCUMENTS, DELIVERY OF
COLLATERAL, TAXES, ETC. The Security Documents (or proper notices or
financing statements in respect thereof) shall have been duly
recorded, published and filed in such manner and in such places as is
required by law to establish, perfect, preserve and protect the
rights and security interests of the parties thereto and their
respective successors and assigns, all collateral items required to
be physically delivered to the Collateral Agent thereunder shall have
been so delivered, accompanied by any appropriate instruments of
transfer, and all taxes, fees and other charges then due and payable
in connection with the execution, delivery, recording, publishing and
filing of such instruments and the issue and delivery of the Notes
shall have been paid in full.
(j) EVIDENCE OF INSURANCE. The Collateral Agent shall have
received certificates of insurance and other evidence, satisfactory
to it, of compliance with the insurance requirements of this
Agreement and the Security Documents.
(k) SEARCH REPORTS. The Administrative Agent shall have
received completed requests for information on Form UCC-11, or search
reports from one or more commercial search firms acceptable to the
Administrative Agent, listing all of the effective financing
statements filed against the Borrower in any jurisdiction in which
the Borrower maintains an office or in which any Collateral of the
Borrower is located, together with copies of such financing
statements.
(l) PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings and all documents incidental to the transactions
contemplated hereby shall be satisfactory in substance and form to
the Administrative Agent and the Lenders and the Administrative Agent
and its special counsel and the Lenders shall have received all such
counterpart originals or certified or other copies of such documents
as the Administrative Agent or its special counsel or any Lender may
reasonably request.
6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The obligations of
the Lenders to make each Loan and/or of a Letter of Credit Issuer to issue each
Letter of Credit is subject, at the time thereof, to the satisfaction of the
following conditions:
(a) NOTICE OF BORROWING, ETC. The Administrative Agent
shall have received a Notice of Borrowing meeting the requirements of
section 2.3 with respect to the incurrence of Loans or a Letter of
Credit Request meeting the requirement of section 3.2 with respect to
the issuance of a Letter of Credit.
(b) NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time
of each Credit Event and also after giving effect thereto, (i) there
shall exist no Default or Event of Default and (ii) all
representations and warranties of the Credit Parties contained herein
or in the other Credit Documents shall be true and correct in all
material respects with the same effect as though such representations
and warranties had been made on and as of the date of such Credit
Event, except to the extent that such representations and warranties
expressly relate to an earlier specified date, in which case such
representations and warranties shall have been true and correct in
all material respects as of the date when made.
The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by the Borrower to each of the Lenders that all of
the applicable conditions specified in section 6.1 and/or 6.2, as the case may
be, exist as of that time. All of the certificates, legal opinions and other
documents and papers referred to in this section 6, unless otherwise specified,
shall be delivered to the Administrative Agent for the account of each of the
Lenders and, except for the Notes, in sufficient counterparts for each of the
Lenders, and the Administrative Agent will promptly distribute to the Lenders
their respective Notes and the copies of such other certificates, legal opinions
and documents.
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SECTION 7. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Agreement and to
make the Loans, and/or to issue and/or to participate in the Letters of Credit
provided for herein, the Borrower makes the following representations and
warranties to, and agreements with, the Lenders, all of which shall survive the
execution and delivery of this Agreement and each Credit Event:
7.1. CORPORATE STATUS, ETC. Each of the Borrower and its Subsidiaries
(i) is a duly organized or formed and validly existing corporation, partnership
or limited liability company, as the case may be, in good standing under the
laws of the jurisdiction of its formation and has the corporate, partnership or
limited liability company power and authority, as applicable, to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage, and (ii) has duly qualified and is authorized to
do business in all jurisdictions where it is required to be so qualified except
where the failure to be so qualified would not be reasonably likely to have a
Material Adverse Effect.
7.2. SUBSIDIARIES. Annex II hereto lists, as of the date hereof, each
Subsidiary of the Borrower (and the direct and indirect ownership interest of
the Borrower therein).
7.3. CORPORATE POWER AND AUTHORITY, ETC. Each Credit Party has the
corporate or other organizational power and authority to execute, deliver and
carry out the terms and provisions of the Credit Documents to which it is party
and has taken all necessary corporate or other organizational action to
authorize the execution, delivery and performance of the Credit Documents to
which it is party. Each Credit Party has duly executed and delivered each Credit
Document to which it is party and each Credit Document to which it is party
constitutes the legal, valid and binding agreement or obligation of such Credit
Party enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).
7.4. NO VIOLATION. Neither the execution, delivery and performance by
any Credit Party of the Credit Documents to which it is party nor compliance
with the terms and provisions thereof (i) will contravene any provision of any
law, statute, rule, regulation, order, writ, injunction or decree of any court
or governmental instrumentality applicable to such Credit Party or its
properties and assets, (ii) will conflict with or result in any breach of, any
of the terms, covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien upon any of the property or assets of such Credit Party
(other than the Liens provided for in the Security Documents) pursuant to the
terms of any promissory note, bond, debenture, indenture, mortgage, deed of
trust, credit or loan agreement, or any other material agreement or other
instrument, to which such Credit Party is a party or by which it or any of its
property or assets are bound or to which it may be subject, or (iii) will
violate any provision of the certificate or articles of incorporation, by-laws,
or other charter documents of such Credit Party.
7.5. GOVERNMENTAL APPROVALS. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required as a
condition to (i) the execution, delivery and performance by any Credit Party of
any Credit Document to which it is a party, or (ii) the legality, validity,
binding effect or enforceability of any Credit Document to which any Credit
Party is a party, except the filing and recording of financing statements and
other documents necessary in order to perfect the Liens created by the Security
Documents
7.6. LITIGATION. There are no actions, suits or proceedings pending
or, to, the knowledge of the Borrower, threatened with respect to the Borrower
or any of its Subsidiaries (i) that individually or in the aggregate have, or
are reasonably likely to have, a Material Adverse Effect, or (ii) which question
the validity or enforceability of any of the Credit Documents, or of any action
to be taken by any Credit Party pursuant to any of the Credit Documents.
7.7. USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of Loans
shall be utilized to retire the Indebtedness referred to in section 6.1(g), to
finance Permitted Acquisitions and for general corporate purposes (including
working capital) not inconsistent with the requirements of this Agreement.
(b) No part of the proceeds of any Credit Event will be used directly
or indirectly to purchase or carry Margin
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Stock, or to extend credit to others for the purpose of purchasing or carrying
any Margin Stock, in violation of the requirements of the provisions of
Regulation G, T, U or X of the Board of Governors of the Federal Reserve System.
The Borrower is not engaged in the business of extending credit for the purpose
of purchasing or carrying any Margin Stock. At no time would more than 25% of
the value of the assets of the Borrower or of the Borrower and its consolidated
Subsidiaries that are subject to any "arrangement" (as such term is used in
section 221.2(g) of such Regulation U) hereunder be represented by Margin Stock.
7.8. FINANCIAL STATEMENTS, ETC. (a) The Borrower has furnished to the
Lenders and the Administrative Agent complete and correct copies of (i) the
audited consolidated balance sheets of the Borrower and its consolidated
subsidiaries as of December 31, 1997, and December 31, 1996, and the related
audited consolidated statements of income, changes in shareholders' equity, and
cash flows for each of the three years in the period ended December 31, 1997,
accompanied by the unqualified report thereon of the Borrower's independent
accountants, as contained in the Report on Form 10-K filed by the Borrower with
the SEC for its fiscal year ended December 31, 1997; and (ii) the unaudited
condensed consolidated balance sheets of the Borrower and its consolidated
subsidiaries as of March 31, 1998, and the related unaudited condensed
consolidated statements of income and of cash flows of the Borrower and its
consolidated subsidiaries for the fiscal quarter or quarters then ended, as
contained in the Form 10-Q Quarterly Report of the Borrower filed with the SEC
for such fiscal quarter. All such financial statements have been prepared in
accordance with GAAP, consistently applied (except as stated therein), and
fairly present the financial position of the Borrower and its consolidated
subsidiaries as of the respective dates indicated and the consolidated results
of their operations and cash flows for the respective periods indicated, subject
in the case of any such financial statements which are unaudited, to normal
audit adjustments, none of which could reasonably be expected to involve a
Material Adverse Effect.
(b) The Borrower has received consideration which is the reasonable
equivalent value of the obligations and liabilities that the Borrower has
incurred to the Administrative Agent and the Lenders. As of the Closing Date,
the Borrower has capital sufficient to carry on its business and transactions
and all business and transactions in which it is about to engage and is now
solvent and able to pay its debts as they mature and the Borrower, as of the
Closing Date, owns property having a value, both at fair valuation and at
present fair salable value, greater than the amount required to pay the
Borrower's debts; and the Borrower is not entering into the Credit Documents
with the intent to hinder, delay or defraud its creditors. Without limitation of
the foregoing, on and as of the Closing Date, and after giving effect to all
Indebtedness incurred and to be incurred by the Borrower and its Subsidiaries in
connection herewith, (i) the sum of the assets, at a fair valuation, of the
Borrower will exceed its debts, (ii) the Borrower will not have incurred or
intended to, or believe that it will, incur debts beyond its ability to pay such
debts as such debts mature and (iii) the Borrower will have sufficient capital
with which to conduct its business. For purposes of this section 7.8(b), "DEBT"
means any liability on a claim, and "CLAIM" means (x) right to payment whether
or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured; or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(c) The Borrower has delivered or caused to be delivered to the
Lenders prior to the execution and delivery of this Agreement (i) a copy of the
Borrower's Report on Form 10-K as filed with the SEC for its fiscal year ended
December 31, 1997, which contains as of its date a general description of the
business and affairs of the Borrower and its Subsidiaries, and (ii) financial
projections prepared by management of the Borrower for the Borrower and its
Subsidiaries for the 1998 fiscal year (the "FINANCIAL PROJECTIONS"). The
Financial Projections were prepared on behalf of the Borrower in good faith
after taking into account the existing and historical levels of business
activity of the Borrower and its Subsidiaries, known trends, including general
economic trends, and all other information, assumptions and estimates considered
by management of the Borrower and its Subsidiaries to be pertinent thereto. The
Financial Projections were considered by management of the Borrower, as of such
date of preparation, to be realistically achievable; PROVIDED, that no
representation or warranty is made as to the impact of future general economic
conditions or as to whether the Borrower's projected consolidated results as set
forth in the Financial Projections will actually be realized. No facts are known
to the Borrower at the date hereof which, if reflected in the Financial
Projections, would be reasonably likely to result in a material adverse change
in the assets, liabilities, results of operations or cash flows reflected
therein.
7.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 1997, there has
not been any change in the condition, business or affairs of the Borrower and
its Subsidiaries taken as a whole, or their properties and assets considered
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as an entirety, except for changes, none of which, individually or in the
aggregate, has had or is reasonably likely to have, a Material Adverse Effect.
7.10. TAX RETURNS AND PAYMENTS. Each of the Borrower and each of its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, other than
those not yet delinquent and except for those contested in good faith. The
Borrower and each of its Subsidiaries has established on its books such charges,
accruals and reserves in respect of taxes, assessments, fees and other
governmental charges for all fiscal periods as are required by GAAP. The
Borrower knows of no proposed assessment for additional federal, foreign or
state taxes for any period, or of any basis therefor, which, individually or in
the aggregate, taking into account such charges, accruals and reserves in
respect thereof as the Borrower and its Subsidiaries have made, is reasonably
likely to have a Material Adverse Effect.
7.11. TITLE TO PROPERTIES, ETC. The Borrower and each of its
Subsidiaries has good and marketable title, in the case of real property, and
good title (or valid Leaseholds, in the case of any leased property), in the
case of all other property, to all of its properties and assets free and clear
of Liens other than Liens permitted by section 9.3. The interests of the
Borrower and each of its Subsidiaries in the properties reflected in the most
recent balance sheet referred to in section 7.8, taken as a whole, were
sufficient, in the judgment of the Borrower, as of the date of such balance
sheet for purposes of the ownership and operation of the businesses conducted by
the Borrower and such Subsidiaries.
7.12. LAWFUL OPERATIONS, ETC. The Borrower and each of its
Subsidiaries (i) holds all necessary federal, state and local governmental
licenses, registrations, certifications, permits and authorizations necessary to
conduct its business, and (ii) is in full compliance with all material
requirements imposed by law, regulation or rule, whether federal, state or
local, which are applicable to it, its operations, or its properties and assets,
including without limitation, applicable requirements of Environmental Laws,
except for any failure to obtain and maintain in effect, or noncompliance,
which, individually or in the aggregate, is not reasonably likely to have a
Material Adverse Effect.
7.13. ENVIRONMENTAL MATTERS. (a) The Borrower and each of its
Subsidiaries is in compliance with all Environmental Laws governing its business
except to the extent that any such failure to comply (together with any
resulting penalties, fines or forfeitures) is not reasonably likely to have a
Material Adverse Effect. All licenses, permits, registrations or approvals
required for the business of the Borrower and each of its Subsidiaries, as
conducted as of the Closing Date, under any Environmental Law have been secured
and the Borrower and each of its Subsidiaries is in substantial compliance
therewith, except for such licenses, permits, registrations or approvals the
failure to secure or to comply therewith is not reasonably likely to have a
Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries has
received written notice, or otherwise knows, that it is in any respect in
noncompliance with, breach of or default under any applicable writ, order,
judgment, injunction, or decree to which the Borrower or such Subsidiary is a
party or which would affect the ability of the Borrower or such Subsidiary to
operate any real property and no event has occurred and is continuing which,
with the passage of time or the giving of notice or both, would constitute
noncompliance, breach of or default thereunder, except in each such case, such
noncompliance, breaches or defaults as would not reasonably be likely to, in the
aggregate, have a Material Adverse Effect. There are as of the Closing Date no
Environmental Claims pending or, to the best knowledge of the Borrower,
threatened wherein an unfavorable decision, ruling or finding would reasonably
be likely to have a Material Adverse Effect. There are no facts, circumstances,
conditions or occurrences on any Real Property now or at any time owned, leased
or operated by the Borrower or any of its Subsidiaries or on any property
adjacent to any such Real Property, which are known by the Borrower or as to
which the Borrower or any such Subsidiary has received written notice, that
could reasonably be expected (i) to form the basis of an Environmental Claim
against the Borrower or any of its Subsidiaries or any Real Property of the
Borrower or any of its Subsidiaries, or (ii) to cause such Real Property to be
subject to any restrictions on the ownership, occupancy, use or transferability
of such Real Property under any Environmental Law, except in each such case,
such Environmental Claims or restrictions that individually or in the aggregate
would not reasonably be likely to have a Material Adverse Effect.
(b) Hazardous Materials have not at any time been (i) generated,
used, treated or stored on, or transported to or from, any Real Property of the
Borrower or any of its Subsidiaries or (ii) released on any such Real Property,
in each case where such occurrence or event is not in compliance with
Environmental Laws and is reasonably likely to have a Material Adverse Effect.
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7.14. COMPLIANCE WITH ERISA. Compliance by the Borrower with the
provisions hereof and Credit Events contemplated hereby will not involve any
prohibited transaction within the meaning of ERISA or section 4975 of the Code.
The Borrower and each of its Subsidiaries, (i) has fulfilled all obligations
under minimum funding standards of ERISA and the Code with respect to each Plan
that is not a Multiemployer Plan or a Multiple Employer Plan, (ii) has satisfied
all respective contribution obligations in respect of each Multiemployer Plan
and each Multiple Employer Plan, (iii) is in compliance in all material respects
with all other applicable provisions of ERISA and the Code with respect to each
Plan, each Multiemployer Plan and each Multiple Employer Plan, and (iv) has not
incurred any liability under the Title IV of ERISA to the PBGC with respect to
any Plan, any Multiemployer Plan, any Multiple Employer Plan, or any trust
established thereunder. No Plan or trust created thereunder has been terminated,
and there have been no Reportable Events, with respect to any Plan or trust
created thereunder or with respect to any Multiemployer Plan or Multiple
Employer Plan, which termination or Reportable Event will or could result in the
termination of such Plan, Multiemployer Plan or Multi Employer Plan and give
rise to a material liability of the Borrower or any ERISA Affiliate in respect
thereof. Neither the Borrower nor any ERISA Affiliate is at the date hereof, or
has been at any time within the two years preceding the date hereof, an employer
required to contribute to any Multiemployer Plan or Multi Employer Plan, or a
"contributing sponsor" (as such term is defined in section 4001 of ERISA) in any
Multiemployer Plan or Multiple Employer Plan. Neither the Borrower nor any ERISA
Affiliate has any contingent liability with respect to any post-retirement
"welfare benefit plan" (as such term is defined in ERISA) except as has been
disclosed to the Lenders in writing.
7.15. INTELLECTUAL PROPERTY, ETC. The Borrower and each of its
Subsidiaries has obtained or has the right to use all material patents,
trademarks, servicemarks, trade names, copyrights, licenses and other rights
with respect to the foregoing necessary for the present and planned future
conduct of its business, without any known conflict with the rights of others,
EXCEPT for such patents, trademarks, servicemarks, trade names, copyrights,
licenses and rights, the loss of which, and such conflicts, which in any such
case individually or in the aggregate would not be reasonably likely to have a
Material Adverse Effect.
7.16. INVESTMENT COMPANY ACT, ETC. Neither the Borrower nor any of
its Subsidiaries is subject to regulation with respect to the creation or
incurrence of Indebtedness under the Investment Company Act of 1940, as amended,
the Interstate Commerce Act, as amended, the Federal Power Act, as amended, the
Public Utility Holding Company Act of 1935, as amended, or any applicable state
public utility law.
7.17. BURDENSOME CONTRACTS; LABOR RELATIONS. Neither the Borrower nor
any of its Subsidiaries (i) is subject to any unduly burdensome contract,
agreement, corporate restriction, judgment, decree or order, (ii) is a party to
any labor dispute affecting any bargaining unit or other group of employees
generally, (iii) is subject to any material strike, slow down, workout or other
concerted interruptions of operations by employees of the Borrower or any
Subsidiary, whether or not relating to any labor contracts, (iv) is subject to
any significant pending or, to the knowledge of the Borrower, threatened, unfair
labor practice complaint, before the National Labor Relations Board, and (v) is
subject to any significant pending or, to the knowledge of the Borrower,
threatened, grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement, (vi) is subject to any significant
pending or, to the knowledge of the Borrower, threatened, significant strike,
labor dispute, slowdown or stoppage, or (vii) is, to the knowledge of the
Borrower, involved or subject to any union representation organizing or
certification matter with respect to the employees of the Borrower or any of its
Subsidiaries, EXCEPT (with respect to any matter specified in any of the above
clauses), for such matters as, individually or in the aggregate, would not
reasonably be likely to have a Material Adverse Effect.
7.18. EXISTING INDEBTEDNESS. Annex III sets forth a true and complete
list, as of the date or dates set forth therein, of all Indebtedness of the
Borrower and each of its Subsidiaries, on a consolidated basis, which (i) has an
outstanding principal amount of at least $1,000,000, or may be incurred pursuant
to existing commitments or lines of credit, or (ii) is secured by any Lien on
any property of the Borrower or any Subsidiary, and which will be outstanding on
the Closing Date after giving effect to the initial Borrowing hereunder, other
than the Indebtedness created under the Credit Documents (all such Indebtedness,
whether or not in a principal amount meeting such threshold and required to be
so listed on Annex III, herein the "EXISTING INDEBTEDNESS"). The Borrower has
provided to the Administrative Agent prior to the date of execution hereof true
and complete copies (or summary descriptions) of all agreements and instruments
governing the Indebtedness listed on Annex III (the "EXISTING INDEBTEDNESS
AGREEMENTS").
7.19. YEAR 2000 COMPUTER MATTERS. The Borrower and its Subsidiaries
have reviewed the areas within their
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business and operations which could be adversely affected by, and have developed
or are developing a program to address on a timely basis the "Year 2000 Computer
Issue" (that is, the risk that computer applications used by the Borrower and
its Subsidiaries may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after December 31,
1999). Based on such review and program, the Borrower reasonably believes that
the "Year 2000 Computer Issue" is not reasonably likely to have a Material
Adverse Effect.
7.20. SECURITY INTERESTS. Once executed and delivered, and until
terminated in accordance with the terms thereof, each of the Security Documents
creates, as security for the obligations purported to be secured thereby, a
valid and enforceable perfected security interest in and Lien on all of the
Collateral subject thereto from time to time, in favor of the Collateral Agent
for the benefit of the Secured Creditors referred to in the Security Documents,
superior to and prior to the rights of all third persons and subject to no other
Liens (except that the Collateral under the Security Agreement may be subject to
Permitted Liens). No filings or recordings are required in order to perfect the
security interests created under any Security Document except for filings or
recordings required in connection with any such Security Document which shall
have been made, or for which satisfactory arrangements have been made, upon or
prior to the execution and delivery thereof. All recording, stamp, intangible or
other similar taxes required to be paid by any person under applicable legal
requirements or other laws applicable to the property encumbered by the Security
Documents in connection with the execution, delivery, recordation, filing,
registration, perfection or enforcement thereof have been paid.
7.21. TRUE AND COMPLETE DISCLOSURE. All factual information (taken as
a whole) heretofore or contemporaneously furnished by or on behalf of the
Borrower or any of its Subsidiaries in writing to the Administrative Agent or
any Lender for purposes of or in connection with this Agreement or any
transaction contemplated herein, other than the Financial Projections (as to
which representations are made only as provided in section 7.8), is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of such person in writing to any Lender will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and not incomplete by omitting to state any material fact necessary to make such
information (taken as a whole) not misleading at such time in light of the
circumstances under which such information was provided, except that any such
future information consisting of financial projections prepared by management of
the Borrower is only represented herein as being based on good faith estimates
and assumptions believed by such persons to be reasonable at the time made, it
being recognized by the 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 materially from the projected
results. As of the Effective Date, there is no fact known to the Borrower or any
of its Subsidiaries which has, or would reasonably be likely to have, a Material
Adverse Effect which has not theretofore been disclosed in writing to the
Lenders.
SECTION 8. AFFIRMATIVE COVENANTS.
The Borrower hereby covenants and agrees that so long as this
Agreement is in effect and until such time as the Total Commitment has been
terminated, no Notes are outstanding and the Loans, together with interest, Fees
and all other Obligations hereunder, have been paid in full:
8.1. REPORTING REQUIREMENTS. The Borrower will furnish to each Lender
and the Administrative Agent:
(a) ANNUAL FINANCIAL STATEMENTS. As soon as available and in
any event within 90 days after the close of each fiscal year of the
Borrower, the consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as at the end of such fiscal year and the
related consolidated statements of income, of stockholder's equity
and of cash flows for such fiscal year, in each case setting forth
comparative figures for the preceding fiscal year, all in reasonable
detail and accompanied by the opinion with respect to such
consolidated financial statements of independent public accountants
of recognized national standing selected by the Borrower, which
opinion shall be unqualified and shall (i) state that such
accountants audited such consolidated financial statements in
accordance with generally accepted auditing standards, that such
accountants believe that such audit provides a reasonable basis for
their opinion, and that in their opinion such consolidated financial
statements present fairly, in all material respects, the consolidated
financial position of the Borrower and its consolidated subsidiaries
as at the end of such fiscal year and the consolidated results of
their operations and cash flows for such fiscal year in conformity
with generally accepted accounting principles, or (ii) contain such
statements as are customarily included in unqualified
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reports of independent accountants in conformity with the
recommendations and requirements of the American Institute of
Certified Public Accountants (or any successor organization);
PROVIDED that such requirement for the furnishing of such annual
financial statements and accompanying opinion may be fulfilled by the
furnishing of the Borrower's Report on Form 10-K which includes such
financial statements and opinion, as filed with the SEC for the
applicable fiscal year.
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available and
in any event within 45 days after the close of each of the first
three quarterly accounting periods in each fiscal year of the
Borrower, the unaudited condensed consolidated balance sheets of the
Borrower and its consolidated Subsidiaries as at the end of such
quarterly period and the related unaudited condensed consolidated
statements of income and of cash flows for such quarterly period or
for the fiscal year to date, and setting forth, in the case of such
unaudited condensed consolidated statements of income and of cash
flows, comparative figures for the related periods in the prior
fiscal year, and which consolidated financial statements shall be
certified on behalf of the Borrower by the Chief Financial Officer or
other Authorized Officer of the Borrower, subject to changes
resulting from normal year-end audit adjustments; PROVIDED that such
requirement for the furnishing of quarterly financial statements may
be fulfilled by the furnishing of the Borrower's Report on Form 10-Q
which includes such financial statements, as filed with the SEC for
the applicable fiscal quarter.
(c) OFFICER'S COMPLIANCE CERTIFICATES. At the time of the
delivery of the financial statements provided for in sections 8.1(a)
and (b), a certificate, substantially in the form attached hereto as
Exhibit I, on behalf of the Borrower, of the Chief Financial Officer
or other Authorized Officer of the Borrower to the effect that, to
the best knowledge of the Borrower, no Default or Event of Default
exists or, if any Default or Event of Default does exist, specifying
the nature and extent thereof, which certificate shall set forth the
calculations required to establish compliance with the provisions of
sections 9.4(b) and (c), 9.7. 9.8, 9.9 and 9.10 of this Agreement and
identify in reasonable detail any financial adjustments included in
such calculations to take into account the acquisition or disposition
of any business which is required or permitted to be taken into
account hereunder in connection with such calculations.
(d) BUDGETS AND FORECASTS. Not later than 30 days following
the approval of a consolidated budget for any fiscal year by the
Board of Directors of the Borrower, a consolidated budget in
reasonable detail for each of the four fiscal quarters of such fiscal
year, and (if and to the extent prepared by management of the
Borrower) for any subsequent fiscal years, as customarily prepared by
management for its internal use, setting forth, with appropriate
discussion, the forecasted balance sheet, income statement, operating
cash flows and capital expenditures of the Borrower and its
Subsidiaries for the period covered thereby, and the principal
assumptions upon which forecasts and budget are based.
(e) NOTICE OF DEFAULT, LITIGATION, LEGISLATION OR CERTAIN
MATTERS INVOLVING MAJOR CUSTOMERS OR SUPPLIERS. Promptly, and in any
event within three Business Days, in the case of clause (i) below, or
five Business Days, in the case of clause (ii) or (iii) below, after
the Borrower or any of its Subsidiaries obtains knowledge thereof,
notice of
(i) the occurrence of any event which constitutes a
Default or Event of Default, which notice shall specify the
nature thereof, the period of existence thereof and what
action the Borrower proposes to take with respect thereto,
(ii) any litigation or governmental or regulatory
proceeding pending against the Borrower or any of its
Subsidiaries, or the adoption of any legislation,
regulations or rules by any governmental body or agency
thereof, in each case which is likely to have a Material
Adverse Effect or a material adverse effect on the ability
of the Borrower to perform its obligations hereunder or
under any other Credit Document, and
(iii) any significant adverse change (in the
Borrower's reasonable judgment) in the Borrower's or any
Subsidiary's relationship with, or any significant event or
circumstance which is in the Borrower's reasonable judgment
likely to adversely affect the Borrower's or any
Subsidiary's
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relationship with, (A) any customer (or related group of
customers) representing more than 5% of the Borrower's
consolidated revenues during its most recent fiscal year, or
(B) any supplier which is significant to the Borrower and
its Subsidiaries considered as an entirety.
(f) ERISA. Promptly, and in any event within 10 days after
the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
knows of the occurrence of any of the following, the Borrower will
deliver to each of the Lenders a certificate on behalf of the
Borrower of an Authorized Officer of the Borrower setting forth the
full details as to such occurrence and the action, if any, that the
Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to
be given to or filed with or by the Borrower, the Subsidiary, the
ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto:
(i) that a Reportable Event has occurred with
respect to any Plan, which is reasonably likely (in the
Borrower's reasonable judgment) to result in a Material
Adverse Effect;
(ii) the institution of any steps by the Borrower,
any ERISA Affiliate, the PBGC or any other person to
terminate any Plan, which is reasonably likely (in the
Borrower's reasonable judgment) to result in a Material
Adverse Effect;
(iii) the institution of any steps by the Borrower
or any ERISA Affiliate to withdraw from any Plan, which is
reasonably likely (in the Borrower's reasonable judgment) to
result in a Material Adverse Effect;
(iv) the institution of any steps by the Borrower
or any Subsidiary to withdraw from any Multiemployer Plan or
Multiple Employer Plan, if such withdrawal could result in
withdrawal liability (as described in Part 1 of Subtitle E
of Title IV of ERISA) in excess of $1,000,000;
(v) a non-exempt "prohibited transaction" within
the meaning of section 406 of ERISA in connection with any
Plan, which is reasonably likely (in the Borrower's
reasonable judgment) to result in a Material Adverse Effect;
(vi) that a Plan has an Unfunded Current Liability
exceeding $1,000,000;
(vii) any material increase in the contingent
liability of the Borrower or any Subsidiary with respect to
any post-retirement welfare liability; or
(viii) the taking of any action by, or the
threatening of the taking of any action by, the Internal
Revenue Service, the Department of Labor or the PBGC with
respect to any of the foregoing.
(g) ENVIRONMENTAL MATTERS. Promptly upon, and in any event
within 10 Business Days after, an officer of the Borrower obtains
actual knowledge thereof, notice of any of the following
environmental matters which is reasonably likely (in the Borrower's
reasonable judgment) to result in a Material Adverse Effect: (i) any
pending or threatened (in writing) Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Property owned or
operated by the Borrower or any of its Subsidiaries; (ii) any
condition or occurrence on or arising from any Real Property owned or
operated by the Borrower or any of its Subsidiaries that (A) results
in noncompliance by the Borrower or any of its Subsidiaries with any
applicable Environmental Law or (B) would reasonably be expected to
form the basis of an Environmental Claim against the Borrower or any
of its Subsidiaries or any such Real Property; (iii) any condition or
occurrence on any Real Property owned, leased or operated by the
Borrower or any of its Subsidiaries that could reasonably be expected
to cause such Real Property to be subject to any restrictions on the
ownership, occupancy, use or transferability by the Borrower or any
of its Subsidiaries of such Real Property under any Environmental
Law; and (iv) the taking of any removal or remedial action in
response to the actual or alleged presence of any Hazardous Material
on any Real Property owned, leased or operated by the Borrower or any
of its Subsidiaries as required by any Environmental Law or any
governmental or other administrative agency. All such notices shall
describe in reasonable detail the nature of the Environmental
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Claim and the Borrower's or such Subsidiary's response thereto.
(h) AUDITORS' INTERNAL CONTROL COMMENT LETTERS, ETC.
Promptly upon receipt thereof, a copy of each letter or memorandum
commenting on internal accounting controls and/or accounting or
financial reporting policies followed by the Borrower and/or any of
its Subsidiaries, which is submitted to the Borrower by its
independent accountants in connection with any annual or interim
audit made by them of the books of the Borrower or any of its
Subsidiaries.
(i) SEC REPORTS AND REGISTRATION STATEMENTS. Promptly upon
transmission thereof or other filing with the SEC, copies of all
registration statements (other than the exhibits thereto and any
registration statement on Form S-8 or its equivalent) and annual,
quarterly or current reports that the Borrower or any of its
Subsidiaries files with the SEC.
(j) OTHER INFORMATION. With reasonable promptness, such
other information or documents (financial or otherwise) relating to
the Borrower or any of its Subsidiaries as any Lender may reasonably
request from time to time.
8.2. BOOKS, RECORDS AND INSPECTIONS. The Borrower will, and will
cause each of its Subsidiaries to, (i) keep proper books of record and account,
in which full and correct entries shall be made of all financial transactions
and the assets and business of the Borrower or such Subsidiaries, as the case
may be, in accordance with GAAP; and (ii) permit, upon at least five Business
Days' notice to the Chief Financial Officer or any other Authorized Officer of
the Borrower, officers and designated representatives of the Administrative
Agent to visit and inspect any of the properties or assets of the Borrower and
any of its Subsidiaries in whomsoever's possession (but only to the extent the
Borrower or such Subsidiary has the right to do so to the extent in the
possession of another person), to examine the books of account of the Borrower
and any of its Subsidiaries, and to make copies thereof and take extracts
therefrom, and to discuss the affairs, finances and accounts of the Borrower and
of any of its Subsidiaries with, and be advised as to the same by, its and their
officers and independent accountants and independent actuaries, if any, all at
such reasonable times and intervals and to such reasonable extent as the
Administrative Agent may request.
8.3. INSURANCE. (a) The Borrower will, and will cause each of its
Subsidiaries to, (i) maintain insurance coverage by such insurers and in such
forms and amounts and against such risks as are generally consistent with the
insurance coverage maintained by the Borrower and its Subsidiaries at the date
hereof, and (ii) forthwith upon the Administrative Agent's written request,
furnish to the Administrative Agent such information about such insurance as the
Administrative Agent may from time to time reasonably request, which information
shall be prepared in form and detail satisfactory to the Administrative Agent
and certified by an Authorized Officer of the Borrower.
(b) The Borrower will, and will cause each of its Subsidiaries which
is a Credit Party to, at all times keep their respective property which is
subject to the Lien of any Security Document insured in favor of the Collateral
Agent, and all policies or certificates (or certified copies thereof) with
respect to such insurance (and any other insurance maintained by the Borrower or
any such Subsidiary) (i) shall be endorsed to the Collateral Agent's
satisfaction for the benefit of the Collateral Agent (including, without
limitation, by naming the Collateral Agent as loss payee (with respect to
Collateral) or, to the extent permitted by applicable law, as an additional
insured), (ii) shall state that such insurance policies shall not be canceled
without 30 days' prior written notice thereof (or 10 days' prior written notice
in the case of cancellation for the non-payment of premiums) by the respective
insurer to the Collateral Agent, (iii) shall provide that the respective
insurers irrevocably waive any and all rights of subrogation with respect to the
Collateral Agent and the Lenders, and (iv) shall in the case of any such
certificates or endorsements in favor of the Collateral Agent, be delivered to
or deposited with the Collateral Agent. In no event shall the Borrower be
required to deposit the actual insurance policies with the Collateral Agent. The
Administrative Agent shall deliver copies of any certificates of insurance to a
Lender upon such Lender's request.
(c) If the Borrower or any of its Subsidiaries shall fail to maintain
all insurance in accordance with this section 8.3, or if the Borrower or any of
its Subsidiaries shall fail to so endorse and deliver or deposit all
endorsements or certificates with respect thereto, the Administrative Agent
and/or the Collateral Agent shall have the right (but shall be under no
obligation), upon prior notice to the Borrower, to procure such insurance and
the Borrower agrees to reimburse the Administrative Agent or the Collateral
Agent, as the case may be, on demand, for all costs and expenses of procuring
such
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insurance.
8.4. PAYMENT OF TAXES AND CLAIMS. The Borrower will pay and
discharge, and will cause each of its Subsidiaries to pay and discharge, all
taxes, assessments and governmental charges or levies imposed upon it or upon
its income or profits, or upon any properties belonging to it, prior to the date
on which penalties attach thereto, and all lawful claims which, if unpaid, might
become a Lien or charge upon any properties of the Borrower or any of its
Subsidiaries; PROVIDED that neither the Borrower nor any of its Subsidiaries
shall be required to pay any such tax, assessment, charge, levy or claim which
is being contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with GAAP. Without limiting
the generality of the foregoing, the Borrower will, and will cause each of its
Subsidiaries to, pay in full all of its wage obligations to its employees in
accordance with the Fair Labor Standards Act (29 U.S.C. sections 206-207) and
any comparable provisions of applicable law.
8.5. CORPORATE FRANCHISES. The Borrower will do, and will cause each
of its Subsidiaries to do, or cause to be done, all things necessary to preserve
and keep in full force and effect its corporate or other organizational
existence, rights, authority and franchises, PROVIDED that nothing in this
section 8.5 shall be deemed to prohibit (i) any transaction permitted by section
9.2; (ii) the termination of existence of any Subsidiary if (A) the Borrower
determines that such termination is in its best interest and (B) such
termination is not adverse in any material respect to the Lenders; or (iii) the
loss of any rights, authorities or franchises if the loss thereof, in the
aggregate, would not reasonably be likely to have a Material Adverse Effect.
8.6. GOOD REPAIR. The Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment used or
useful in its business in whomsoever's possession they may be, are kept in good
repair, working order and condition, normal wear and tear excepted, and that
from time to time there are made in such properties and equipment all needful
and proper repairs, renewals, replacements, extensions, additions, betterments
and improvements, thereto, to the extent and in the manner customary for
companies in similar businesses.
8.7. COMPLIANCE WITH STATUTES, ETC. The Borrower will, and will cause
each of its Subsidiaries to, comply, in all material respects, with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property, other than those (i)
being contested in good faith by appropriate proceedings, as to which adequate
reserves are established to the extent required under GAAP, and (ii) the
noncompliance with which would not have, and which would not be reasonably
likely to have, a Material Adverse Effect or a material adverse effect on the
ability of the Borrower to perform its obligations under any Credit Document.
8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS. Without limitation of the
covenants contained in section 8.7 hereof:
(a) The Borrower will, and will cause each of its
Subsidiaries to, (i) comply, in all material respects, with all
Environmental Laws applicable to the ownership, lease or use of all
Real Property now or hereafter owned, leased or operated by the
Borrower or any of its Subsidiaries, and promptly pay or cause to be
paid all costs and expenses incurred in connection with such
compliance, except for such noncompliance as would not have, and
which would not be reasonably likely to have, a Material Adverse
Effect or a material adverse effect on the ability of the Borrower to
perform its obligations under any Credit Document; and (ii) keep or
cause to be kept all such Real Property free and clear of any Liens
imposed pursuant to such Environmental Laws which are not permitted
under section 9.3.
(b) Without limitation of the foregoing, if the Borrower or
any of its Subsidiaries shall generate, use, treat, store, release or
dispose of, or permit the generation, use, treatment, storage,
release or disposal of, Hazardous Materials on any Real Property now
or hereafter owned, leased or operated by the Borrower or any of its
Subsidiaries, or transport or permit the transportation of Hazardous
Materials to or from any such Real Property, any such action shall be
effected only in the ordinary course of business and in any event in
compliance, in all material respects, with all Environmental Laws
applicable thereto, except for such noncompliance as would not have,
and which would not be reasonably likely to have, a Material Adverse
Effect or a material adverse effect on the ability of the Borrower to
perform its obligations under any Credit Document.
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(c) If required to do so under any applicable order of any
governmental agency, the Borrower will undertake, and cause each of
its Subsidiaries to undertake, any clean up, removal, remedial or
other action necessary to remove and clean up any Hazardous Materials
from any Real Property owned, leased or operated by the Borrower or
any of its Subsidiaries in accordance with, in all material respects,
the requirements of all applicable Environmental Laws and in
accordance with, in all material respects, such orders of all
governmental authorities, except (i) to the extent that the Borrower
or such Subsidiary is contesting such order in good faith and by
appropriate proceedings and for which adequate reserves have been
established to the extent required by GAAP, or (ii) for such
noncompliance as would not have, and which would not be reasonably
likely to have, a Material Adverse Effect or a material adverse
effect on the ability of the Borrower to perform its obligations
under any Credit Document.
(d) At the written request of the Administrative Agent or
the Required Lenders, which request shall specify in reasonable
detail the basis therefor, at any time and from time to time after
the Lenders receive notice under section 8.1(G) for any Environmental
Claim involving potential expenditures by the Borrower or any of its
Subsidiaries in excess of $5,000,000 in the aggregate for any Real
Property, the Borrower will provide, at its sole cost and expense, an
environmental site assessment report concerning any such Real
Property now or hereafter owned, leased or operated by the Borrower
or any of its Subsidiaries, prepared by an environmental consulting
firm reasonably acceptable to the Administrative Agent, indicating
the presence or absence of Hazardous Materials and the potential cost
of any removal or a remedial action in connection with any Hazardous
Materials on such Real Property. If the Borrower fails to provide the
same within 90 days after such request was made, the Administrative
Agent may order the same, and the Borrower shall grant and hereby
grants, to the Administrative Agent and the Lenders and their agents,
access to such Real Property and specifically grants the
Administrative Agent and the Lenders an irrevocable non-exclusive
license, subject to the rights of tenants, to undertake such an
assessment, all at the Borrower's expense.
8.9. FISCAL YEARS, FISCAL QUARTERS. The Borrower will, for
consolidated financial reporting purposes, continue to use December 31 as the
end of its fiscal year and March 31, June 30, September 30 and December 31 as
the end of its fiscal quarters. If the Borrower shall change any of its
Subsidiaries' fiscal years or fiscal quarters (other than the fiscal year or
fiscal quarters of a person which becomes a Subsidiary, made at the time such
person becomes a Subsidiary, to conform to the Borrower's fiscal year and fiscal
quarters or to conform to the fiscal year or fiscal quarters which the Borrower
generally utilizes for its Subsidiaries), the Borrower will promptly, and in any
event within 30 days following any such change, deliver a notice to the
Administrative Agent and the Lenders describing such change and any material
accounting entries made in connection therewith and stating whether such change
will have any impact upon any financial computations to be made hereunder, and
if any such impact is foreseen, describing in reasonable detail the nature and
extent of such impact. If the Required Lenders determine that any such change
will have any impact upon any financial computations to be made hereunder which
is adverse to the Lenders, the Borrower will, if so requested by the
Administrative Agent, enter into an amendment to this Agreement, in form and
substance satisfactory to the Administrative Agent and the Required Lenders,
modifying any of the financial covenants or related provisions hereof in such
manner as the Required Lenders determine is necessary to eliminate such adverse
effect.
8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY AND
SECURITY AGREEMENT. In the event that at any time after the Closing Date the
Borrower has any Domestic Subsidiary (other than the Receivables Subsidiary)
which has total consolidated total assets with a gross book value (or fair
value, as reasonably determined by the Borrower) greater than $10,000,000 which
is not a party to the Subsidiary Guaranty or the Security Agreement, the
Borrower will notify the Administrative Agent in writing of such event,
identifying the Subsidiary in question and referring specifically to the rights
of the Administrative Agent and the Lenders under this section. The Borrower
will, within 30 days following request therefor from the Administrative Agent
(who may give such request on its own initiative or upon request by the Required
Lenders), cause such Subsidiary to deliver to the Administrative Agent, in
sufficient quantities for the Lenders, (i) the Subsidiary Guaranty (as modified,
amended or supplemented from time to time in accordance with the terms thereof
and hereof, the "SUBSIDIARY GUARANTY"), substantially in the form attached
hereto as Exhibit D, if the Subsidiary Guaranty has not previously been executed
and delivered by any Subsidiary of the Borrower, (ii) if the Subsidiary Guaranty
has already been executed and delivered by any other Subsidiary of the Borrower,
a joinder supplement, satisfactory in form and substance to the Administrative
Agent and the Required Lenders, duly executed by such Subsidiary, pursuant to
which such Subsidiary joins in the Subsidiary Guaranty as a guarantor
thereunder, (iii) a joinder supplement, satisfactory in form and substance to
the
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Administrative Agent and the Required Lenders, duly executed by such Subsidiary,
pursuant to which such Subsidiary joins in the Security Agreement as an Assignor
thereunder, and (iv) if such Subsidiary is a corporation, resolutions of the
Board of Directors of such Subsidiary, certified by the Secretary or an
Assistant Secretary of such Subsidiary as duly adopted and in full force and
effect, authorizing the execution and delivery of the Subsidiary Guaranty or
such joinder supplement or supplements, as the case may be, or if such
Subsidiary is not a corporation, such other evidence of the authority of such
Subsidiary to execute the Subsidiary Guaranty or such joinder supplement or
supplements, as the case may be, as the Administrative Agent may reasonably
request.
8.11. HEDGE AGREEMENTS, ETC. In the event the Borrower or any of its
Subsidiaries determines to enter into a Hedge Agreement it may do so, PROVIDED
that (i) the purpose of such Hedge Agreement is to provide protection to the
Borrower or any such Subsidiary from fluctuations and other changes in interest
rates and currency exchange rates, as and to the extent considered reasonably
necessary by the Borrower, but without exposing the Borrower or its Subsidiaries
to predominantly speculative risks unrelated to the amount of assets,
Indebtedness or other liabilities intended to be subject to coverage on a
notional basis under all such Hedge Agreements; and (ii) in the case of any
Hedge Agreement entered into after the Effective Date, only if the proposed form
thereof (including any proposed pricing or other material terms) has been
provided to the Administrative Agent contemporaneously with the entry into such
Hedge Agreement.
8.12. SENIOR DEBT. The Borrower will at all times ensure that (a) the
claims of the Lenders in respect of the Obligations of the Borrower will not be
subordinate to, and will in all respects at least rank PARI PASSU with, the
claims of every other senior unsecured creditor of the Borrower, and (b) any
Indebtedness subordinated in any manner to the claims of any other senior
secured or unsecured creditor of the Borrower will be subordinated in like
manner to such claims of the Lenders.
SECTION 9. NEGATIVE COVENANTS.
The Borrower hereby covenants and agrees that on the Effective Date
and thereafter for so long as this Agreement is in effect and until such time as
the Total Commitment has been terminated, no Notes remain outstanding and the
Loans, together with interest, Fees and all other Obligations incurred hereunder
are paid in full:
9.1. CHANGES IN BUSINESS. Neither the Borrower nor any of its
Subsidiaries will engage in any business which is not the same as or
complementary to the business engaged in by the Borrower on the Effective Date,
or make any changes in any such business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Borrower and its Subsidiaries, would be substantially changed from the
general nature of the business engaged in by the Borrower and its Subsidiaries,
taken as a whole, on the date hereof.
9.2. CONSOLIDATION, MERGER, ACQUISITIONS, SALE OF ASSETS, ETC. The
Borrower will not, and will not permit any Subsidiary to, (1) wind up, liquidate
or dissolve its affairs, or (2) enter into any transaction of merger or
consolidation, or (3) make or otherwise effect any Acquisition, or (4) make or
otherwise effect any Asset Sale, or (5) agree to do any of the foregoing at any
future time, EXCEPT that the following shall be permitted:
(a) PERMITTED INVESTMENTS: the investments permitted
pursuant to section 9.5;
(b) CERTAIN INTERCOMPANY MERGERS, ETC.: if no Default or
Event of Default shall have occurred and be continuing or would
result therefrom, (i) the merger, consolidation or amalgamation of
any Wholly-Owned Subsidiary with or into the Borrower or another
Wholly-Owned Subsidiary, so long as in any merger, consolidation or
amalgamation involving the Borrower, the Borrower is the surviving or
continuing or resulting corporation, (ii) the liquidation or
dissolution of any Subsidiary, or (iii) the transfer or other
disposition of any property by the Borrower to any Wholly-Owned
Subsidiary or by any Wholly-Owned Subsidiary to the Borrower or any
other Wholly-Owned Subsidiary of the Borrower;
(c) PERMITTED ACQUISITIONS: if no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, the Borrower or any Subsidiary may make Permitted
Acquisitions, PROVIDED that all conditions to any such Permitted
Acquisition contained in the definition of the term Permitted
Acquisition
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are satisfied;
(d) PERMITTED DISPOSITIONS: if no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, the Borrower or any of its Subsidiaries may (i) sell any
property, land or building (including any related receivables or
other intangible assets) to any person which is not a Subsidiary of
the Borrower, or (ii) sell the entire capital stock (or other equity
interests) and Indebtedness of any Subsidiary owned by the Borrower
or any other Subsidiary to any person which is not a Subsidiary of
the Borrower, or (iii) permit any Subsidiary to be merged or
consolidated with a person which is not an Affiliate of the Borrower,
or (iv) consummate any other Asset Sale with a person who is not a
Subsidiary of the Borrower; PROVIDED that (A) the consideration for
such transaction represents fair value (as determined by management
of the Borrower), (B) if the aggregate consideration for such
transaction exceeds $3,000,000, at least 75% of such consideration
consists of cash, (C) in the case of any such transaction involving
consideration in excess of $3,000,000, at least five Business Days
prior to the date of completion of such transaction the Borrower
shall have delivered to the Administrative Agent an officer's
certificate executed on behalf of the Borrower by an Authorized
Officer of the Borrower, which certificate shall contain a
description of the proposed transaction, the date such transaction is
scheduled to be consummated, and the estimated purchase price or
other consideration for such transaction, and which shall (if
requested by the Administrative Agent) include a certified copy of
the draft or definitive documentation pertaining thereto, and (D)
promptly following the consummation of such transaction, the Borrower
prepays Loans with the Net Proceeds of the transaction, as and to the
extent contemplated by section 5.2(b);
(e) CAPITAL EXPENDITURES: Consolidated Capital Expenditures
not otherwise in violation of this Agreement; and
(f) LEASES: the Borrower or any of its Subsidiaries may
enter into leases of property or assets not constituting Permitted
Acquisitions in the ordinary course of business not otherwise in
violation of this Agreement.
To the extent the Required Lenders (or all of the Lenders as shall be required
by section 12.12) waive the provisions of this section 9.2 with respect to the
sale, transfer or other disposition of any Collateral, or all of the stock or
other interests in a Subsidiary, or any Collateral or the stock or other equity
interests in a Subsidiary is sold, transferred or disposed of as permitted by
this section 9.2, (i) such Collateral shall be sold, transferred or disposed of
free and clear of the Liens created by the respective Security Documents; (ii)
if all of the capital stock or other equity interests in a Subsidiary which is a
party to the Subsidiary Guaranty and/or any Security Document is so sold,
transferred or disposed of, such Subsidiary shall be released from the
Subsidiary Guaranty and/or such Security Documents; and (iii) the Administrative
Agent and the Collateral Agent are hereby authorized to take actions deemed
appropriate by them in order to effectuate the foregoing.
9.3. LIENS. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets of any kind (real or personal, tangible or
intangible) of the Borrower or any such Subsidiary whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with or without
recourse to the Borrower or any of its Subsidiaries, other than for purposes of
collection of delinquent accounts in the ordinary course of business) or assign
any right to receive income, or file or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute, EXCEPT that the foregoing restrictions shall not
apply to:
(a) the Standard Permitted Liens; and
(b) Liens which
(i) are placed upon equipment, machinery, Real
Property, or the improvements to Real Property, used in the
ordinary course of business of the Borrower or any
Subsidiary at the time of (or within 180 days after) the
acquisition thereof, or completion of the improvements
thereto, by the Borrower or any such Subsidiary, to secure
Indebtedness incurred to pay or finance all or a portion of
the purchase price or cost thereof, PROVIDED that the Lien
encumbering the equipment, machinery, Real Property, or
improvements to Real Property, so acquired or constructed
does not encumber any other
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asset of the Borrower or any such Subsidiary; or
(ii) are existing on property or other assets at
the time acquired by the Borrower or any Subsidiary or on
assets of a person at the time such person first becomes a
Subsidiary of the Borrower; PROVIDED that (A) any such Liens
were not created at the time of or in contemplation of the
acquisition of such assets or person by the Borrower or any
of its Subsidiaries; (B) in the case of any such acquisition
of a person, any such Lien attaches only to the property and
assets of such person; and (C) in the case of any such
acquisition of property or assets by the Borrower or any
Subsidiary, any such Lien attaches only to the property and
assets so acquired and not to any other property or assets
of the Borrower or any Subsidiary;
PROVIDED that (1) the Indebtedness secured by any such Lien does not
exceed 100% of the fair market value of the property and assets to
which such Lien attaches, determined at the time of the acquisition
or completion of construction of such property or asset or the time
at which such person becomes a Subsidiary of the Borrower (except in
the circumstances described in clause (ii) above to the extent such
Liens constituted customary purchase money Liens at the time of
incurrence and were entered into in the ordinary course of business),
and (2) the Indebtedness secured thereby is permitted by section
9.4(b).
9.4. INDEBTEDNESS. The Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness of the Borrower or any of its Subsidiaries, EXCEPT:
(a) Indebtedness incurred under this Agreement and the other
Credit Documents;
(b) Indebtedness of the Borrower or any Subsidiary in
respect of Capital Leases, and Indebtedness subject to Liens
permitted by section 9.3(b), including in any such case any guaranty
by the Borrower of any such Indebtedness; PROVIDED that (i) the
aggregate Capitalized Lease Obligations of the Borrower and its
Subsidiaries, PLUS the aggregate outstanding principal amount of
Indebtedness subject to Liens permitted under section 9.3(b), shall
not exceed $12,000,000 in the aggregate at any time outstanding, and
(ii) at the time of any incurrence thereof after the date hereof, and
after giving effect thereto, no Event of Default shall have occurred
and be continuing or would result therefrom;
(c) Indebtedness of the Receivables Subsidiary under a
receivables securitization program;
(d) Existing Indebtedness, to the extent not otherwise
permitted pursuant to the foregoing clauses; and any refinancing,
extension, renewal or refunding of any such Existing Indebtedness not
involving an increase in the principal amount thereof or a reduction
of more than 10% in the remaining weighted average life to maturity
thereof (computed in accordance with standard financial practice);
(e) Indebtedness of the Borrower or any Subsidiary under
Hedge Agreements;
(f) Indebtedness of the Borrower to any of its Subsidiaries,
and Indebtedness of any of the Borrower's Subsidiaries to the
Borrower or to another Subsidiary of the Borrower, in each case to
the extent permitted under section 9.5;
(g) Guaranty Obligations permitted under section 9.5; and
(h) additional unsecured Indebtedness and Guaranty
Obligations of the Borrower, not otherwise permitted pursuant to the
foregoing clauses, provided that at the time of incurrence thereof
and after giving effect thereto, (i) no Event of Default shall have
occurred and be continuing or shall result therefrom, and (ii) the
Borrower would have been in compliance with the covenants contained
in sections 9.7 and 9.8 hereof if such Indebtedness had been incurred
at the beginning of the most recent Testing Period for which
financial information has been furnished to the Lenders hereunder,
and such Indebtedness remained outstanding throughout such Testing
Period.
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9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS. The
Borrower will not, and will not permit any of its Subsidiaries to, (1) lend
money or credit or make advances to any person, (2) purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, or other investment in, any person, (3) create, acquire
or hold any Subsidiary, (4) be or become a party to any joint venture or
partnership, or (5) be or become obligated under any Guaranty Obligations (other
than those created in favor of the Lenders pursuant to the Credit Documents),
EXCEPT:
(a) the Borrower or any of its Subsidiaries may invest in
cash and Cash Equivalents;
(b) any endorsement of a check or other medium of payment
for deposit or collection, or any similar transaction in the normal
course of business;
(c) the Borrower and its Subsidiaries may acquire and hold
receivables owing to them in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(d) investments acquired by the Borrower or any of its
Subsidiaries (i) in exchange for any other investment held by the
Borrower or any such Subsidiary in connection with or as a result of
a bankruptcy, workout, reorganization or recapitalization of the
issuer of such other investment, or (ii) as a result of a foreclosure
by the Borrower or any of its Subsidiaries with respect to any
secured investment or other transfer of title with respect to any
secured investment in default;
(e) loans and advances to employees for business-related
travel expenses, moving expenses, costs of replacement homes and
other similar expenses, in each case incurred in the ordinary course
of business, shall be permitted;
(f) to the extent not permitted by the foregoing clauses,
the existing loans, advances, investments and guarantees described on
Annex V hereto;
(g) any unsecured guaranty by the Borrower of any
Indebtedness of a Subsidiary permitted by section 9.4, and any
guaranty by any Subsidiary described in section 9.4;
(h) investments of the Borrower and its Subsidiaries in
Hedge Agreements;
(i) loans and advances by any Subsidiary of the Borrower to
the Borrower, PROVIDED that the Indebtedness represented thereby
constitutes Subordinated Indebtedness;
(j) loans and advances by the Borrower or by any Subsidiary
of the Borrower to, or other investments in, any Wholly-Owned
Subsidiary of the Borrower;
(k) Guaranty Obligations, not otherwise permitted by the
foregoing clauses, of (i) the Borrower or any Subsidiary in respect
of leases of the Borrower or any Subsidiary the entry into which is
not prohibited by this Agreement, (ii) the Borrower or any Subsidiary
in respect of any other person (other than in respect of (x)
Indebtedness for borrowed money or represented by bonds, notes,
debentures or similar securities, or (y) Indebtedness constituting
Capital Leases) arising as a matter of applicable law because the
Borrower or such Subsidiary is or is deemed to be a general partner
of such other person, or (iii) the Borrower or any Subsidiary in
respect of any other person (other than in respect of (x)
Indebtedness for borrowed money or represented by bonds, notes,
debentures or similar securities, or (y) Indebtedness constituting
Capital Leases) arising in the ordinary course of business;
(l) Acquisitions permitted under section 9.2, and loans,
advances and investments of any person which are outstanding at the
time such person becomes a Subsidiary of the Borrower as a result of
an Acquisition permitted by section 9.2, but not any increase in the
amount thereof; and
(m) any other loans, advances, investments (whether in the
form of cash or contribution of property,
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and if in the form of a contribution of property, such property shall
be valued for purposes of this clause at the fair value thereof as
reasonably determined by the Borrower) and Guaranty Obligations,
including, without limitation, in or to or for the benefit of,
Subsidiaries, joint ventures, or other persons, not otherwise
permitted by the foregoing clauses, made after the end of the most
recent fiscal quarter of the Borrower for which financial statements
were furnished to the Lenders prior to the Effective Date (such
loans, advances and investments and Guaranty Obligations,
collectively, "BASKET INVESTMENTS AND GUARANTEES"), shall be
permitted to be incurred if (i) no Event of Default shall have
occurred and be continuing, or would result therefrom, and (ii) the
aggregate Basket Investments and Guarantees incurred in any fiscal
year does not exceed $2,000,000.
9.6. DIVIDENDS, ETC. The Borrower will not (a) directly or indirectly
declare, order, pay or make any dividend (other than dividends payable solely in
capital stock of the Borrower) or other distribution on or in respect of any
capital stock of any class of the Borrower, whether by reduction of capital or
otherwise, or (b) directly or indirectly make, or permit any of its Subsidiaries
to directly or indirectly make, any purchase, redemption, retirement or other
acquisition of any capital stock of any class of the Borrower (other than for a
consideration consisting solely of capital stock of the same class of the
Borrower) or of any warrants, rights or options to acquire or any securities
convertible into or exchangeable for any capital stock of the Borrower, EXCEPT
that if no Event of Default shall have occurred and be continuing or would
result therefrom, the Borrower shall be permitted to repurchase shares of its
capital stock in open market or privately negotiated transactions if the
aggregate amount expended for such purposes after December 31, 1997 does not
exceed $20,000,000.
9.7. CONSOLIDATED TOTAL INDEBTEDNESS/CONSOLIDATED EBITDA RATIO. The
Borrower will not at any time permit the ratio of (i) the amount of Consolidated
Total Indebtedness at such time to (ii) Consolidated EBITDA for any Testing
Period, to exceed 2.50 to 1.00.
9.8. INTEREST COVERAGE RATIO. The Borrower will not permit its ratio
of (i) Consolidated EBIT, to (ii) Consolidated Interest Expense, for any Testing
Period to be less than 3.00 to 1.00.
9.9. RATIO OF CONSOLIDATED TOTAL LIABILITIES TO CONSOLIDATED NET
WORTH. The Borrower will not at any time permit its ratio of (i) Consolidated
Total Liabilities, to (ii) Consolidated Net Worth, to be greater than 2.50 to
1.00.
9.10. MINIMUM CONSOLIDATED NET WORTH. The Borrower will not permit
its Consolidated Net Worth at any time to be less than $40,000,000, EXCEPT that
(i) effective as of the end of the Borrower's fiscal year ended December 31,
1997, and as of the end of each fiscal year thereafter, the foregoing amount (as
it may from time to time be increased as herein provided), shall be increased by
50% of the consolidated net income of the Borrower and its Subsidiaries for the
fiscal year ended on such date, if any, as determined in conformity with GAAP
(there being no reduction in the case of any such consolidated net income which
reflects a deficit), (ii) the foregoing amount (as it may from time to time be
increased as herein provided), shall be increased by an amount equal to 100% of
the cash proceeds (net of underwriting discounts and commissions and other
customary fees and costs associated therewith) from any sale or issuance of
equity by the Borrower after the Closing Date (other than any sale or issuance
to management or employees pursuant to employee benefit plans of general
application), and (iii) the foregoing amount (as it may from time to time be
increased as herein provided), shall be increased by an amount equal to 50% of
the increase in Consolidated Net Worth attributable to the issuance of common
stock or other equity interests subsequent to December 31, 1997 as consideration
in any Acquisitions permitted under section 9.2.
9.11. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will
not permit any Subsidiary to, enter into any transaction or series of
transactions with any Affiliate (other than, in the case of the Borrower, any
Subsidiary, and in the case of a Subsidiary, the Borrower or another Subsidiary)
other than in the ordinary course of business of and pursuant to the reasonable
requirements of the Borrower's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary than would
obtain in a comparable arm's-length transaction with a person other than an
Affiliate, EXCEPT (i) loans, advances and investments permitted by section 9.5,
(ii) sales of goods to an Affiliate for use or distribution outside the United
States which in the good faith judgment of the Borrower complies with any
applicable legal requirements of the Code, or (iii) agreements and transactions
with and payments to officers, directors and shareholders which are either (A)
entered into in the ordinary course of business and not prohibited by any of the
provisions of this Agreement, or (B) entered into outside the ordinary course of
business, approved by the directors or shareholders of the Borrower, and not
prohibited by any of the provisions of this Agreement.
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9.12. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS. The Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly,
enter into, incur or permit to exist or become effective, any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of the Borrower or any Subsidiary to create, incur or suffer to exist
any Lien upon any of its property or assets as security for Indebtedness, or (b)
the ability of any such Subsidiary to pay dividends or make any other
distributions on its capital stock or any other interest or participation in its
profits owned by the Borrower or any Subsidiary of the Borrower, or pay any
Indebtedness owed to the Borrower or a Subsidiary of the Borrower, or to make
loans or advances to the Borrower or any of the Borrower's other Subsidiaries,
or transfer any of its property or assets to the Borrower or any of the
Borrower's other Subsidiaries, EXCEPT for such restrictions existing under or by
reason of (i) applicable law, (ii) this Agreement and the other Credit
Documents, (iii) customary provisions restricting subletting or assignment of
any lease governing a leasehold interest, (iv) customary provisions restricting
assignment of any licensing agreement entered into in the ordinary course of
business, (v) customary provisions restricting the transfer of assets subject to
Liens permitted under section 9.3(b), (vi) restrictions contained in the
Existing Indebtedness Agreements as in effect on the Effective Date (and similar
restrictions contained in any agreement or instrument evidencing or governing
any Indebtedness incurred in connection with a refinancing thereof permitted
under this Agreement), (vii) customary restrictions affecting only a Subsidiary
of the Borrower under any agreement or instrument governing any of the
Indebtedness of a Subsidiary permitted pursuant to 9.4, (viii) any document
relating to Indebtedness secured by a Lien permitted by section 9.3, insofar as
the provisions thereof limit grants of junior liens on the assets securing such
Indebtedness, and (ix) any operating lease or Capital Lease, insofar as the
provisions thereof limit grants of a security interest in, or other assignments
of, the related leasehold interest to any other person.
9.13. PLAN TERMINATIONS, MINIMUM FUNDING, ETC. The Borrower will not,
and will not permit any ERISA Affiliate to, (i) terminate any Plan or plans so
as to result in liability of the Borrower or any ERISA Affiliate to the PBGC in
excess of $2,000,000 in the aggregate, (ii) permit to exist one or more events
or conditions which reasonably present a material risk of the termination by the
PBGC of any Plan or Plans with respect to which the Borrower or any ERISA
Affiliate would, in the event of such termination, incur liability to the PBGC
in excess of $2,000,000 in the aggregate, or (iii) fail to comply with the
minimum funding standards of ERISA and the Code with respect to any Plan.
SECTION 10. EVENTS OF DEFAULT.
10.1. EVENTS OF DEFAULT. Upon the occurrence of any of the following
specified events (each an "EVENT OF DEFAULT"):
(a) PAYMENTS: the Borrower shall (i) default in the payment
when due of any principal of the Loans or any reimbursement
obligation in respect of any Unpaid Drawing; or (ii) default, and
such default shall continue for five or more days, in the payment
when due of any interest on the Loans or any Fees or any other
amounts owing hereunder or under any other Credit Document; or
(b) REPRESENTATIONS, ETC.: any representation, warranty or
statement made by the Borrower herein or in any other Credit Document
or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove to be untrue in any
material respect on the date as of which made or deemed made; or
(c) CERTAIN NEGATIVE COVENANTS: the Borrower shall default
in the due performance or observance by it of any term, covenant or
agreement contained in sections 9.2 through 9.10 of this Agreement;
or
(d) OTHER COVENANTS: the Borrower shall default in the due
performance or observance by it of any term, covenant or agreement
contained in this Agreement or any other Credit Document, other than
those referred to in section 10.1(a) or (b) or (c) above, and such
default shall not be remedied within 30 days after the earlier of (i)
an officer of the Borrower obtaining actual knowledge of such default
or (ii) the Borrower receiving written notice of such default from
the Administrative Agent or the Required Lenders (any such notice to
be identified as a "notice of default " and to refer specifically to
this paragraph); or
(e) DEFAULT UNDER OTHER AGREEMENTS: the Borrower or any of
its Subsidiaries shall (i) default in
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any payment with respect to any Indebtedness (other than the
Obligations) owed to any Lender, or having an unpaid principal amount
of $5,000,000 or greater, and such default shall continue after the
applicable grace period, if any, specified in the agreement or
instrument relating to such Indebtedness, or (ii) default in the
observance or performance of any agreement or condition relating to
any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto (and all grace periods
applicable to such observance, performance or condition shall have
expired), or any other event shall occur or condition exist, the
effect of which default or other event or condition is to cause, or
to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause any such
Indebtedness to become due prior to its stated maturity; or any such
Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable, or shall be required to be prepaid
(other than by a regularly scheduled required prepayment or
redemption, prior to the stated maturity thereof); or
(f) OTHER CREDIT DOCUMENTS: the Subsidiary Guaranty or any
Security Document (once executed and delivered) shall cease for any
reason (other than termination in accordance with its terms) to be in
full force and effect; or any Credit Party shall default in any
payment obligation thereunder; or any Credit Party shall default in
any material respect in the due performance and observance of any
other obligation thereunder and such default shall continue
unremedied for a period of at least 30 days after notice by the
Administrative Agent or the Required Lenders; or any Credit Party
shall (or seek to) disaffirm or otherwise limit its obligations
thereunder otherwise than in strict compliance with the terms
thereof; or
(g) JUDGMENTS: one or more judgments or decrees shall be
entered against the Borrower and/or any of its Subsidiaries involving
a liability (whether or not covered by insurance) of $_____ or more
in the aggregate for all such judgments and decrees for the Borrower
and its Subsidiaries) and any such judgments or decrees shall not
have been vacated, discharged or stayed or bonded pending appeal
within 30 days from the entry thereof; or
(h) BANKRUPTCY, ETC.: any of the following shall occur:
(i) the Borrower, any of its Material Subsidiaries
or any other Credit Party (the Borrower and each of such
other persons, each a "PRINCIPAL PARTY") shall commence a
voluntary case concerning itself under Title 11 of the
United States Code entitled "Bankruptcy," as now or
hereafter in effect, or any successor thereto (the
"BANKRUPTCY CODE"); or
(ii) an involuntary case is commenced against any
Principal Party and the petition is not controverted within
10 days, or is not dismissed within 90 days, after
commencement of the case; or
(iii) a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or
substantially all of the property of any Principal Party; or
(iv) any Principal Party commences (including by
way of applying for or consenting to the appointment of, or
the taking of possession by, a rehabilitator, receiver,
custodian, trustee, conservator or liquidator (collectively,
a "CONSERVATOR") of itself or all or any substantial portion
of its property) any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency, liquidation,
rehabilitation, conservatorship or similar law of any
jurisdiction whether now or hereafter in effect relating to
such Principal Party; or
(v) any such proceeding is commenced against any
Principal Party to the extent such proceeding is consented
by such person or remains undismissed for a period of 90
days; or
(vi) any Principal Party is adjudicated insolvent
or bankrupt; or
(vii) any order of relief or other order approving
any such case or proceeding is entered; or
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(viii) any Principal Party suffers any appointment
of any conservator or the like for it or any substantial
part of its property which continues undischarged or
unstayed for a period of 90 days; or
(ix) any Principal Party makes a general assignment
for the benefit of creditors; or
(x) any corporate (or similar organizational)
action is taken by any Principal Party for the purpose of
effecting any of the foregoing; or
(i) ERISA: (i) any of the events described in clauses (i)
through (viii) of section 8.1(f) shall have occurred; or (ii) there
shall result from any such event or events the imposition of a lien,
the granting of a security interest, or a liability or a material
risk of incurring a liability; and (iii) any such event or events or
any such lien, security interest or liability, individually, and/or
in the aggregate, in the opinion of the Required Lenders, has had, or
would reasonably be likely to have, a Material Adverse Effect.
10.2. ACCELERATION, ETC. Upon the occurrence of any Event of Default,
and at any time thereafter, if any Event of Default shall then be continuing,
the Administrative Agent shall, upon the written request of the Required
Lenders, by written notice to the Borrower, take any or all of the following
actions (PROVIDED that, if an Event of Default specified in section 10.1(h)
shall occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent as specified in clauses (a)
and (b) below shall occur automatically without the giving of any such notice):
(a) declare the Total Commitment terminated, whereupon the
Commitment of each Lender shall forthwith terminate immediately
without any other notice of any kind;
(b) declare the principal of and any accrued interest in
respect of all Loans, all Unpaid Drawings and all obligations owing
hereunder and thereunder to be, whereupon the same shall become,
forthwith due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the
Borrower;
(c) terminate any Letter of Credit which may be terminated
in accordance with its terms;
(d) direct the Borrower to pay (and the Borrower hereby
agrees that on receipt of such notice or upon the occurrence of an
Event of Default with respect to the Borrower under section 10.1(h),
it will pay) to the Administrative Agent an amount of cash equal to
the aggregate Stated Amount of all Letters of Credit then outstanding
(such amount to be held as security after the Borrower's
reimbursement obligations in respect thereof); and/or
(i) take such other actions and exercise such other remedies
as may be permitted under applicable law.
10.3. APPLICATION OF LIQUIDATION PROCEEDS. All monies received by the
Administrative Agent or any Lender from the exercise of remedies hereunder or
under the other Credit Documents or under any other documents relating to this
Agreement shall, unless otherwise required by the terms of the other Credit
Documents or by applicable law, be applied as follows:
(a) FIRST, to the payment of all expenses (to the extent not
paid by the Borrower) incurred by the Administrative Agent and the
Lenders in connection with the exercise of such remedies, including,
without limitation, all reasonable costs and expenses of collection,
attorneys' fees, court costs and any foreclosure expenses;
(b) SECOND, to the payment PRO RATA of interest then accrued
on the outstanding Loans;
(c) THIRD, to the payment PRO RATA of any fees then accrued
and payable to the Administrative Agent, any Letter of Credit Issuer
or any Lender under this Agreement in respect of the Loans or the
Letter of Credit
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Outstandings;
(d) FOURTH, to the payment PRO RATA of (i) the principal
balance then owing on the outstanding Loans, (ii) the amounts then
due under Designated Hedge Agreements to creditors of the Borrower or
any Subsidiary, subject to confirmation by the Administrative Agent
of any calculations of termination or other payment amounts being
made in accordance with normal industry practice, and (iii) the
Stated Amount of the Letter of Credit Outstandings (to be held and
applied by the Administrative Agent as security for the reimbursement
obligations in respect thereof);
(e) FIFTH, to the payment to the Lenders of any amounts then
accrued and unpaid under sections 2.9, 2.10 and 3.5 hereof, and if
such proceeds are insufficient to pay such amounts in full, to the
payment of such amounts PRO RATA;
(f) SIXTH, to the payment PRO RATA of all other amounts owed
by the Borrower to the Administrative Agent, to any Letter of Credit
Issuer or any Lender under this Agreement or any other Credit
Document, and to any counterparties under Designated Hedge Agreements
of the Borrower and its Subsidiaries, and if such proceeds are
insufficient to pay such amounts in full, to the payment of such
amounts PRO RATA; and
(g) FINALLY, any remaining surplus after all of the
Obligations have been paid in full, to the Borrower or to whomsoever
shall be lawfully entitled thereto.
SECTION 11. THE ADMINISTRATIVE AGENT.
11.1. APPOINTMENT. Each Lender hereby irrevocably designates and
appoints NCB as Administrative Agent (such term to include, for the purposes of
this section 11, NCB acting as Collateral Agent) to act as specified herein and
in the other Credit Documents, and each such Lender hereby irrevocably
authorizes NCB as the Administrative Agent for such Lender, to take such action
on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent agrees to act as such upon the
express conditions contained in this section 11. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
in the other Credit Documents, nor any fiduciary relationship with any Lender,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this section 11 are solely for the
benefit of the Administrative Agent, and the Lenders, and the Borrower and its
Subsidiaries shall not have any rights as a third party beneficiary of any of
the provisions hereof. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for the Borrower or any of its
Subsidiaries.
11.2. DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by section 11.3.
11.3. EXCULPATORY PROVISIONS. Neither the Administrative Agent nor
any of its respective officers, directors, employees, agents, attorneys-in-fact
or affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such person under or in connection with this Agreement (except
for its or such person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or of its Subsidiaries or any
of their respective officers contained in this Agreement, any other Credit
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Credit Document or for any failure
of the Borrower or any Subsidiary of the Borrower or any of their respective
officers to perform its obligations hereunder or thereunder. The Administrative
Agent shall not be under any obligation to any Lender to ascertain or to inquire
as to the
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observance or performance of any of the agreements contained in, or conditions
of, this Agreement, or to inspect the properties, books or records of the
Borrower or any of its Subsidiaries. The Administrative Agent shall not be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any Credit
Document or for any representations, warranties, recitals or statements made
herein or therein or made in any written or oral statement or in any financial
or other statements, instruments, reports, certificates or any other documents
in connection herewith or therewith furnished or made by the Administrative
Agent to the Lenders or by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default.
11.4. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, facsimile transmission, telex or teletype message,
statement, order or other document or conversation believed by it, in good
faith, to be genuine and correct and to have been signed, sent or made by the
proper person or persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower or any of its
Subsidiaries), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Credit
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Required Lenders (or all of the Lenders, as to
any matter which, pursuant to section 12.12, can only be effectuated with the
consent of all Lenders), and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders.
11.5. NOTICE OF DEFAULT. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give prompt notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders, PROVIDED that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
11.6. NON-RELIANCE. Each Lender expressly acknowledges that neither
the Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates have made any representations or warranties to
it and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower or any of its Subsidiaries, shall be
deemed to constitute any representation or warranty by the Administrative Agent
to any Lender. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent, or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower and its Subsidiaries and made its own decision
to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent, or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower and its Subsidiaries.
The Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, assets, property, financial and other conditions, prospects or
creditworthiness of the Borrower or any of its Subsidiaries which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
11.7. INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent in its capacity as such ratably according to their
respective Loans and Unutilized Commitments, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may
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at any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, incurred by or asserted against the
Administrative Agent in its capacity as such in any way relating to or arising
out of this Agreement or any other Credit Document, or any documents
contemplated by or referred to herein or the transactions contemplated hereby or
any action taken or omitted to be taken by the Administrative Agent under or in
connection with any of the foregoing, but only to the extent that any of the
foregoing is not paid by the Borrower, PROVIDED that no Lender shall be liable
to the Administrative Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting solely from the Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this section 11.7 shall survive the payment of all Obligations.
11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower, its Subsidiaries
and their Affiliates as though not acting as Administrative Agent hereunder.
With respect to the Loans made by it and all Obligations owing to it, the
Administrative Agent shall have the same rights and powers under this Agreement
as any Lender and may exercise the same as though it were not the Administrative
Agent, and the terms "Lender" and "Lenders" shall include the Administrative
Agent in its individual capacity.
11.9. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as the Administrative Agent upon 20 days' notice to the Lenders and the
Borrower. The Required Lenders shall appoint from among the Lenders a successor
Administrative Agent for the Lenders subject to prior approval by the Borrower
(such approval not to be unreasonably withheld or delayed), whereupon such
successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term "Administrative Agent" shall include such
successor agent effective upon its appointment, and the resigning Administrative
Agent's rights, powers and duties as the Administrative Agent shall be
terminated, without any other or further act or deed on the part of such former
Administrative Agent or any of the parties to this Agreement. After the retiring
Administrative Agent's resignation hereunder as the Administrative Agent, the
provisions of this section 11 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent under this
Agreement.
11.10. OTHER AGENTS. Any Lender identified herein as a Co-Agent,
Syndication Agent, Documentation Agent, Managing Agent, Manager or any other
corresponding title, other than "Administrative Agent" or "Collateral Agent",
shall have no right, power, obligation, liability, responsibility or duty under
this Agreement or any other Credit Document except those applicable to all
Lenders as such. Each Lender acknowledges that it has not relied, and will not
rely, on any Lender so identified in deciding to enter into this Agreement or in
taking or not taking any action hereunder.
SECTION 12. MISCELLANEOUS.
12.1. PAYMENT OF EXPENSES ETC. The Borrower agrees to:
(a) whether or not the transactions herein contemplated are
consummated, pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with the
negotiation, preparation, execution and delivery of the Credit
Documents and the documents and instruments referred to therein, the
delivery of documents on the Closing Date pursuant to section 6.1 and
the initial Borrowing hereunder, including, without limitation, the
reasonable fees and disbursements of Xxxxx, Day, Xxxxxx & Xxxxx,
special counsel to the Administrative Agent;
(b) pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with any
amendment, waiver or consent relating to any of the Credit Documents
which is requested by any Credit Party, including, without
limitation, (i) the reasonable fees and disbursements of Xxxxx, Day,
Xxxxxx & Xxxxx, special counsel to the Administrative Agent, and (ii)
the reasonable fees and disbursements of any individual counsel to
any Lender (including allocated costs of internal counsel);
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(c) pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with the
enforcement of any of the Credit Documents or the other documents and
instruments referred to therein, including, without limitation, (i)
the reasonable fees and disbursements of Xxxxx, Day, Xxxxxx & Xxxxx,
special counsel to the Administrative Agent, and (ii) the reasonable
fees and disbursements of any individual counsel to any Lender
(including allocated costs of internal counsel);
(d) without limitation of the preceding clause (c), in the
event of the bankruptcy, insolvency, rehabilitation or other similar
proceeding in respect of the Borrower or any of its Subsidiaries, pay
all costs of collection and defense, including reasonable attorneys'
fees in connection therewith and in connection with any appellate
proceeding or post-judgment action involved therein, which shall be
due and payable together with all required service or use taxes;
(e) pay and hold each of the Lenders harmless from and
against any and all present and future stamp and other similar taxes
with respect to the foregoing matters and save each of the Lenders
harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent
attributable to such Lender) to pay such taxes; and
(f) indemnify each Lender, its officers, directors,
employees, representatives and agents (collectively, the
"INDEMNITEES") from and hold each of them harmless against any and
all losses, liabilities, claims, damages or expenses reasonably
incurred by any of them as a result of, or arising out of, or in any
way related to, or by reason of
(i) any investigation, litigation or other
proceeding (whether or not any Lender is a party thereto)
related to the entering into and/or performance of any
Credit Document or the use of the proceeds of any Loans
hereunder or the consummation of any transactions
contemplated in any Credit Document, other than any such
investigation, litigation or proceeding arising out of
transactions solely between any of the Lenders or the
Administrative Agent, transactions solely involving the
assignment by a Lender of all or a portion of its Loans and
Commitments, or the granting of participations therein, as
provided in this Agreement, or arising solely out of any
examination of a Lender by any regulatory or other
governmental authority having jurisdiction over it, or
(ii) the actual or alleged presence of Hazardous
Materials in the air, surface water or groundwater or on the
surface or subsurface of any Real Property owned, leased or
at any time operated by the Borrower or any of its
Subsidiaries, the release, generation, storage,
transportation, handling or disposal of Hazardous Materials
at any location, whether or not owned or operated by the
Borrower or any of its Subsidiaries, if the Borrower or any
such Subsidiary could have or is alleged to have any
responsibility in respect thereof, the non-compliance of any
such Real Property with foreign, federal, state and local
laws, regulations and ordinances (including applicable
permits thereunder) applicable thereto, or any Environmental
Claim asserted against the Borrower or any of its
Subsidiaries, in respect of any such Real Property,
including, in each case, without limitation, the reasonable
documented fees and disbursements of counsel incurred in connection
with any such investigation, litigation or other proceeding (but
excluding any such losses, liabilities, claims, damages or expenses
to the extent incurred by reason of the gross negligence or willful
misconduct of the person to be indemnified or of any other Indemnitee
who is such person or an Affiliate of such person).
To the extent that the undertaking to indemnify, pay or hold harmless any person
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, the Borrower shall make the maximum contribution to
the payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.
12.2. RIGHT OF SETOFF. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Lender is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Borrower or to any
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other person, any such notice being hereby expressly waived, to set off and to
appropriate and apply any and all deposits (general or special) and any other
Indebtedness at any time held or owing by such Lender (including, without
limitation, by branches and agencies of such Lender wherever located) to or for
the credit or the account of the Borrower against and on account of the
Obligations and liabilities of the Borrower to such Lender under this Agreement
or under any of the other Credit Documents, including, without limitation, all
interests in Obligations the Borrower purchased by such Lender pursuant to
section 12.4(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not such Lender shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
12.3. NOTICES. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile transmission or cable communication)
and mailed, telegraphed, telexed, transmitted, cabled or delivered, if to the
Borrower, at 000 Xxxxx Xxxxx, Xxxxxxxx Xxxxxxx, Xxxx 00000, attention: Corporate
Secretary (facsimile: (000) 000-0000); if to any Lender at its address specified
for such Lender on Annex I hereto; if to the Administrative Agent, at its Notice
Office; or at such other address as shall be designated by any party in a
written notice to the other parties hereto. All such notices and communications
shall be mailed, telegraphed, telexed, telecopied, or cabled or sent by
overnight courier, and shall be effective when received.
12.4. BENEFIT OF AGREEMENT. (a) This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns, PROVIDED that the Borrower may not assign or
transfer any of its rights or obligations hereunder without the prior written
consent of all the Lenders, and, PROVIDED, FURTHER, that any assignment by a
Lender of its rights and obligations hereunder shall be effected in accordance
with section 12.4(b). Notwithstanding the foregoing, each Lender may at any time
grant participations in any of its rights hereunder or under any of the Notes to
(x) another Lender that is not a Defaulting Lender or to an Affiliate of such
Lender which is a commercial bank, financial institution or other "accredited
investor" (as defined in SEC Regulation D), and (y) one or more Eligible
Transferees, PROVIDED that in the case of any such participation, (i) the
participant shall not have any rights under this Agreement or any of the other
Credit Documents, including rights of consent, approval or waiver (the
participant's rights against such Lender in respect of such participation to be
those set forth in the agreement executed by such Lender in favor of the
participant relating thereto), (ii) such Lender's obligations under this
Agreement (including, without limitation, its Commitment hereunder) shall remain
unchanged, (iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iv) such Lender shall
remain the holder of any Note for all purposes of this Agreement and (v) the
Borrower, the Administrative Agent, and the other Lenders shall continue to deal
solely and directly with the selling Lender in connection with such Lender's
rights and obligations under this Agreement, and all amounts payable by the
Borrower hereunder shall be determined as if such Lender had not sold such
participation, except that the participant shall be entitled to the benefits of
sections 2.9 and 2.10 of this Agreement to the extent that such Lender would be
entitled to such benefits if the participation had not been entered into or
sold, and, PROVIDED FURTHER, that no Lender shall transfer, grant or sell any
participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (x) extend the final scheduled
maturity of the Loans in which such participant is participating (it being
understood that any waiver of the making of, or the application of , any
mandatory prepayment to such Loans shall not constitute an extension of the
final maturity date thereof), or reduce the rate or extend the time of payment
of interest or Fees thereon (except in connection with a waiver of the
applicability of any post-default increase in interest rates), or reduce the
principal amount thereof, or increase such participant's participating interest
in any Commitment over the amount thereof then in effect (it being understood
that a waiver of any Default or Event of Default or of any mandatory prepayment
or a mandatory reduction in the such Commitment, or a mandatory prepayment,
shall not constitute a change in the terms of any such Commitment) or (y)
release any Credit Party from its obligations under the Subsidiary Guaranty
(once executed and delivered), or release all or any substantial portion of the
Collateral, in each case except strictly in accordance with the terms of the
Credit Documents, or (z) consent to the assignment or transfer by the Borrower
of any of its rights and obligations under this Agreement.
(b) Notwithstanding the foregoing, (x) any Lender may assign all or a
fixed portion of its Loans and/or Commitment, and its rights and obligations
hereunder, to another Lender that is not a Defaulting Lender, or to an Affiliate
of any Lender (including itself) and which is not a Defaulting Lender and which
is a commercial bank, financial institution or other "accredited investor" (as
defined in SEC Regulation D), and (y) any Lender may assign all, or if less than
all, a fixed portion, equal to at least $5,000,000 in the aggregate for the
assigning Lender or assigning Lenders, of its Loans and/or Commitment and its
rights and obligations hereunder, to one or more Eligible Transferees, each of
which assignees shall
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become a party to this Agreement as a Lender by execution of an Assignment
Agreement, PROVIDED that, (i) in the case of any assignment of a portion of any
Loans and/or Commitment of a Lender, such Lender shall retain a minimum fixed
portion of all Loans and Commitments equal to at least $5,000,000, (ii) at the
time of any such assignment Annex I shall be deemed modified to reflect the
Commitments of such new Lender and of the existing Lenders, (iii) upon surrender
of the old Notes, new Notes will be issued, at the Borrower's expense, to such
new Lender and to the assigning Lender, such new Notes to be in conformity with
the requirements of section 2.5 (with appropriate modifications) to the extent
needed to reflect the revised Commitments, (iv) in the case of clause (y) only,
the consent of the Administrative Agent and each Letter of Credit Issuer shall
be required in connection with any such assignment (which consent shall not be
unreasonably withheld or delayed), and (v) the Administrative Agent shall
receive at the time of each such assignment, from the assigning or assignee
Lender, the payment of a non-refundable assignment fee of $3,000 and, PROVIDED
FURTHER, that such transfer or assignment will not be effective until recorded
by the Administrative Agent on the Lender Register maintained by it as provided
herein. To the extent of any assignment pursuant to this section 12.4(b) the
assigning Lender shall be relieved of its obligations hereunder with respect to
its assigned Commitments. At the time of each assignment pursuant to this
section 12.4(b) to a person which is not already a Lender hereunder and which is
not a United States person (as such term is defined in section 7701(a)(30) of
the Code) for Federal income tax purposes, the respective assignee Lender shall
provide to the Borrower and the Administrative Agent the appropriate Internal
Revenue Service Forms (and, if applicable a Section 5.4(b)(ii) Certificate)
described in section 5.4(b). To the extent that an assignment of all or any
portion of a Lender's Commitment and related outstanding Obligations pursuant to
this section 12.4(b) would, at the time of such assignment, result in increased
costs under section 2.9 from those being charged by the respective assigning
Lender prior to such assignment, then the Borrower shall not be obligated to pay
such increased costs (although the Borrower shall be obligated to pay any other
increased costs of the type described above resulting from changes after the
date of the respective assignment). Nothing in this section 12.4(b) shall
prevent or prohibit any Lender from pledging its Notes or Loans to a Federal
Reserve Bank in support of borrowings made by such Lender from such Federal
Reserve Bank.
(c) Notwithstanding any other provisions of this section 12.4, no
transfer or assignment of the interests or obligations of any Lender hereunder
or any grant of participation therein shall be permitted if such transfer,
assignment or grant would require the Borrower to file a registration statement
with the SEC or to qualify the Loans under the "Blue Sky" laws of any State.
(d) Each Lender initially party to this Agreement hereby represents,
and each person that became a Lender pursuant to an assignment permitted by this
section 12.4 will, upon its becoming party to this Agreement, represent that it
is a commercial lender, other financial institution or other "accredited"
investor (as defined in SEC Regulation D) which makes or acquires loans in the
ordinary course of its business and that it will make or acquire Loans for its
own account in the ordinary course of such business, PROVIDED that subject to
the preceding sections 12.4(a) and (b), the disposition of any promissory notes
or other evidences of or interests in Indebtedness held by such Lender shall at
all times be within its exclusive control.
12.5. NO WAIVER: REMEDIES CUMULATIVE. No failure or delay on the part
of the Administrative Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower and the Administrative Agent or any Lender shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which the Administrative
Agent or any Lender would otherwise have. No notice to or demand on the Borrower
in any case shall entitle the Borrower to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
12.6. PAYMENTS PRO RATA. (a) The Administrative Agent agrees that
promptly after its receipt of each payment from or on behalf of the Borrower in
respect of any Obligations, it shall distribute such payment to the Lenders
(other than any Lender that has expressly waived in writing its right to receive
its PRO RATA share thereof) PRO RATA based upon their respective shares, if any,
of the Obligations with respect to which such payment was received. As to any
such payment received by the Administrative Agent prior to 1:00 P.M. (local time
at the Payment Office) in funds which are immediately available on such day, the
Administrative Agent will use all reasonable efforts to distribute such payment
in immediately available funds on the same day to the Lenders as aforesaid.
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(b) Each of the Lenders agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans or Fees, of a sum which with respect to the related sum or sums
received by other Lenders is in a greater proportion than the total of such
Obligation then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations to such Lenders in such amount as shall result in a proportional
participation by all of the Lenders in such amount, PROVIDED that if all or any
portion of such excess amount is thereafter recovered from such Lender, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding sections 12.6(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Lenders which are not Defaulting Lenders, as opposed to
Defaulting Lenders.
12.7. CALCULATIONS: COMPUTATIONS. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Lenders); PROVIDED, that if at any time the computations
determining compliance with section 9 utilize accounting principles different
from those utilized in the financial statements furnished to the Lenders, such
computations shall set forth in reasonable detail a description of the
differences and the effect upon such computations.
(b) All computations of interest on Loans hereunder and all
computations of Commitment Fee, Letter of Credit Fees and other Fees hereunder
shall be made on the actual number of days elapsed over a year of 360 days.
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF OHIO. TO THE FULLEST
EXTENT PERMITTED BY LAW, THE BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY
WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY JURISDICTION OTHER THAN THE STATE
OF OHIO GOVERNS THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS. Any legal
action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the Court of Common Pleas of Cuyahoga County, Ohio, or in the
United States District Court for the Northern District of Ohio, and, by
execution and delivery of this Agreement, the Borrower hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Borrower hereby
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to the Borrower at its
address for notices pursuant to section 12.3, such service to become effective
30 days after such mailing or at such earlier time as may be provided under
applicable law. Nothing herein shall affect the right of the Administrative
Agent or any Lender to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against the Borrower in any
other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in section 12.8(a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
12.9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different
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parties hereto on separate counterparts, each of which when so executed and
delivered shall be an original, but all of which shall together constitute one
and the same agreement. A set of counterparts executed by all the parties hereto
shall be lodged with the Borrower and the Administrative Agent.
12.10. EFFECTIVENESS. This Agreement shall become effective on the
date (the "EFFECTIVE DATE") on which the Borrower and each of the Lenders shall
have signed a copy hereof (whether the same or different copies) and shall have
delivered the same to the Administrative Agent at the Notice Office of the
Administrative Agent or, in the case of the Lenders, shall have given to the
Administrative Agent telephonic (confirmed in writing), written telex or
facsimile transmission notice (actually received) at such office that the same
has been signed and mailed to it.
12.11. HEADINGS DESCRIPTIVE. The headings of the several sections and
other portions of this Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
12.12. AMENDMENT OR WAIVER. Neither this Agreement nor any terms
hereof or thereof may be changed, waived, discharged or terminated UNLESS such
change, waiver, discharge or termination is in writing signed by the Borrower
and the Required Lenders, PROVIDED that no such change, waiver, discharge or
termination shall, without the consent of each Lender (other than a Defaulting
Lender) affected thereby,
(a) extend any maturity date provided for herein applicable
to a Loan or a Commitment (it being understood that any waiver of the
making, or application of, any mandatory prepayment of the Loans
shall not constitute an extension of the maturity date thereof),
reduce the rate or extend the time of payment of interest (other than
as a result of waiving the applicability of any post-default increase
in interest rates) or Fees thereon, or reduce the principal amount
thereof, or increase the Commitment of any Lender over the amount
thereof then in effect (it being understood that a waiver of any
Default or Event of Default or of any mandatory prepayment or a
mandatory reduction in any Commitment shall not constitute a change
in the terms of any Commitment of any Lender),
(b) release the Borrower from any obligations as a guarantor
of its Subsidiaries' obligations under any Credit Document,
(c) release any Credit Party from the Subsidiary Guaranty
(once executed and delivered), except in connection with a
transaction permitted by section 9.2(d),
(d) release all or any substantial portion of the
Collateral, except strictly in accordance with the provisions of the
Credit Documents,
(e) change the definition of the term "Change of Control" or
any of the provisions of section 4.3 or 5.2 which are applicable upon
a Change of Control,
(f) amend, modify or waive any provision of this section
12.12, or section 11.7, 12.1, 12.4, 12.6 or 12.7(b), or any other
provision of any of the Credit Documents pursuant to which the
consent or approval of all Lenders is by the terms of such provision
explicitly required,
(g) reduce the percentage specified in, or otherwise modify,
the definition of Required Lenders, or
(h) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement.
No provision of section 3 or 11 may be amended without the consent of (x) any
Letter of Credit Issuer adversely affected thereby or (y) the Administrative
Agent, respectively.
12.13. SURVIVAL OF INDEMNITIES. All indemnities set forth herein
including, without limitation, in section 2.9, 2.10, 3.5, 11.7 or 12.1 shall
survive the execution and delivery of this Agreement and the making and
repayment of Loans.
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12.14. DOMICILE OF LOANS. Each Lender may transfer and carry its
Loans at, to or for the account of any branch office, subsidiary or affiliate of
such Lender, PROVIDED that the Borrower shall not be responsible for costs
arising under section 2.9 resulting from any such transfer (other than a
transfer pursuant to section 2.11) to the extent not otherwise applicable to
such Lender prior to such transfer.
12.15. CONFIDENTIALITY. Each Lender shall hold all non-public
information obtained pursuant to the requirements of this Agreement which has
been identified as such by the Borrower in accordance with its customary
procedure for handling confidential information of this nature and in accordance
with safe and sound banking practices. Notwithstanding the foregoing, any Lender
may in any event make disclosures of, and furnish copies of such information (i)
to another Lender; (ii) when reasonably required by any BONA FIDE transferee or
participant in connection with the contemplated transfer of any Loans or
Commitment or participation therein (PROVIDED that each such prospective
transferee and/or participant shall execute an agreement for the benefit of the
Borrower with such prospective transferor Lender and/or participant containing
provisions substantially identical to those contained in this section 12.15);
(iii) to its parent corporation or corporations, and to its and their auditors
and attorneys; and (iv) as required or requested by any governmental agency or
representative thereof or pursuant to legal process, PROVIDED that, unless
specifically prohibited by applicable law or court order, each Lender shall
notify the Borrower of any request by any governmental agency or representative
thereof (other than any such request in connection with an examination of the
financial condition of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such information. In
no event shall any Lender be obligated or required to return any materials
furnished by or on behalf of the Borrower or any of its Subsidiaries. The
Borrower hereby agrees that the failure of a Lender to comply with the
provisions of this section 12.15 shall not relieve the Borrower of any of the
obligations to such Lender under this Agreement and the other Credit Documents.
12.16. LENDER REGISTER. The Borrower hereby designates the
Administrative Agent to serve as its agent, solely for purposes of this section
12.16, to maintain a register (the "LENDER REGISTER") on or in which it will
record the names and addresses of the Lenders, and the Commitments from time to
time of each of the Lenders, the Loans made to the Borrower by each of the
Lenders and each repayment and prepayment in respect of the principal amount of
such Loans of each such Lender. Failure to make any such recordation, or (absent
manifest error) any error in such recordation, shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Lender, the transfer
of the Commitment of such Lender and the rights to the principal of, and
interest on, any Loan made pursuant to such Commitment shall not be effective
until such transfer is recorded on the Lender Register maintained by the
Administrative Agent with respect to ownership of such Commitment and Loans and
prior to such recordation all amounts owing to the transferor with respect to
such Commitment and Loans shall remain owing to the transferor. The registration
of assignment or transfer of all or part of any Commitments and Loans shall be
recorded by the Administrative Agent on the Lender Register only upon the
acceptance by the Administrative Agent of a properly executed and delivered
Assignment Agreement pursuant to section 12.4(b). The Borrower agrees to
indemnify the Administrative Agent from and against any and all losses, claims,
damages and liabilities of whatsoever nature which may be imposed on, asserted
against or incurred by the Administrative Agent in performing its duties under
this section 12.16. The Lender Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
12.17. LIMITATIONS ON LIABILITY OF THE LETTER OF CREDIT ISSUERS. The
Borrower assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of such Letters of
Credit. Neither any Letter of Credit Issuer nor any of its officers or directors
shall be liable or responsible for: (a) the use which may be made of any Letter
of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; (b) the validity, sufficiency or genuineness of documents,
or of any endorsement thereon, even if such documents should prove to be in any
or all respects invalid, insufficient, fraudulent or forged; (c) payment by a
Letter of Credit Issuer against presentation of documents that do not comply
with the terms of a Letter of Credit, including failure of any documents to bear
any reference or adequate reference to such Letter of Credit; or (d) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit, EXCEPT that the Borrower (or a Subsidiary which is the account party
in respect of the Letter of Credit in question) shall have a claim against a
Letter of Credit Issuer, and a Letter of Credit Issuer shall be liable to the
Borrower (or such Subsidiary), to the extent of any direct, but not
consequential, damages suffered by the Borrower (or such Subsidiary) which the
Borrower (or such Subsidiary) proves were caused by (i) such Letter of Credit
Issuer's willful misconduct or gross negligence in determining whether documents
presented under a Letter of Credit comply with the terms of such Letter of
Credit or (ii) such Letter of Credit Issuer's willful failure to make lawful
payment under any Letter of Credit after the presentation to it of documentation
strictly complying with the terms and conditions of such Letter of Credit. In
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furtherance and not in limitation of the foregoing, a Letter of Credit Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation.
12.18. GENERAL LIMITATION OF LIABILITY. No claim may be made by the
Borrower, any Lender, the Administrative Agent, any Letter of Credit Issuer or
any other person against the Administrative Agent, any Letter of Credit Issuer,
or any other Lender or the Affiliates, directors, officers, employees, attorneys
or agents of any of them for any damages other than actual compensatory damages
in respect of any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement or
any of the other Credit Documents, or any act, omission or event occurring in
connection therewith; and each of the Borrower, each Lender, the Administrative
Agent and each Letter of Credit Issuer hereby, to the fullest extent permitted
under applicable law, waives, releases and agrees not to xxx or counterclaim
upon any such claim for any special, consequential or punitive damages, whether
or not accrued and whether or not known or suspected to exist in its favor.
12.19. NO DUTY. All attorneys, accountants, appraisers, consultants
and other professional persons (including the firms or other entities on behalf
of which any such person may act) retained by the Administrative Agent or any
Lender with respect to the transactions contemplated by the Credit Documents
shall have the right to act exclusively in the interest of the Administrative
Agent or such Lender, as the case may be, and shall have no duty of disclosure,
duty of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to the Borrower, to any of its Subsidiaries, or to any other person,
with respect to any matters within the scope of such representation or related
to their activities in connection with such representation.
12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC. The
relationship among the Borrower and its Subsidiaries, on the one hand, and the
Administrative Agent, each Letter of Credit Issuer and the Lenders, on the other
hand, is solely that of debtor and creditor, and the Administrative Agent, each
Letter of Credit Issuer and the Lenders have no fiduciary or other special
relationship with the Borrower and its Subsidiaries, and no term or provision of
any Credit Document, no course of dealing, no written or oral communication, or
other action, shall be construed so as to deem such relationship to be other
than that of debtor and creditor.
12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties herein shall survive the making of Loans and the
issuance of Letters of Credit hereunder, the execution and delivery of this
Agreement, the Notes and the other documents the forms of which are attached as
Exhibits hereto, the issue and delivery of the Notes, any disposition thereof by
any holder thereof, and any investigation made by the Administrative Agent or
any Lender or any other holder of any of the Notes or on its behalf. All
statements contained in any certificate or other document delivered to the
Administrative Agent or any Lender or any holder of any Notes by or on behalf of
the Borrower or of its Subsidiaries pursuant hereto or otherwise specifically
for use in connection with the transactions contemplated hereby shall constitute
representations and warranties by the Borrower hereunder, made as of the
respective dates specified therein or, if no date is specified, as of the
respective dates furnished to the Administrative Agent or any Lender.
[The balance of this page is intentionally blank.]
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
ROYAL APPLIANCE MFG. CO.
BY:
--------------------------------------
SECRETARY
NATIONAL CITY BANK,
INDIVIDUALLY AS A LENDER, A LETTER OF CREDIT
ISSUER AND AS ADMINISTRATIVE AGENT
BY:
--------------------------------------
SENIOR VICE PRESIDENT
COMERICA BANK
BY:
--------------------------------------
ASSISTANT VICE PRESIDENT
NATIONAL BANK OF CANADA,
A CANADIAN CHARTERED BANK,
CLEVELAND REPRESENTATIVE OFFICE
BY:
--------------------------------------
VICE PRESIDENT
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ANNEX I
INFORMATION AS TO LENDERS
========================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
========================================================================================================================
National City Bank National City Bank National City Bank
COMMITMENT: 0000 Xxxx Xxxxx Xxxxxx 0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000
$20,250,000
CONTACTS/ NOTIFICATION METHODS:
Xxxxxx X. Xxxxx, Xx.
Senior Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
CONTACT FOR BORROWINGS, PAYMENTS, ETC.:
Xxxxxx Djucik
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
WIRING INFORMATION:
ABA # 041 000 124
Commercial Loan Operations:
Ref.: Royal Appliance Mfg. Co.
------------------------------------------------------------------------------------------------------------------------
Comerica Bank Comerica Bank Comerica Bank
COMMITMENT: Comerica Tower at Detroit Center Comerica Tower at Detroit Center
000 Xxxxxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx
$14,850,000 Xxxxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000
NOTIFICATION/PRIMARY CONTACT:
Xxxxx X. Dragon
Assistant Vice President
Metropolitan Loans--A
Comerica Bank
Comerica Tower at Detroit Center
6th Floor
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
CONTACT FOR BORROWINGS, PAYMENTS, ETC.:
PAYMENT INSTRUCTIONS:
ABA # 072 0000 96
Attention: Commercial Loan Operations
Reference: Royal Appliance Mfg. Co.
------------------------------------------------------------------------------------------------------------------------
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========================================================================================================================
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
========================================================================================================================
National Bank of National Bank of Canada, National Bank of Canada,
Canada, COMMITMENT: a Canadian Chartered Bank, a Canadian Chartered Bank,
a Canadian Cleveland Representative Office Cleveland Representative Office
Chartered Bank, $9,900,000 Xxx Xxxxxxxxx Xxxxxx Xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx 0000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000 0000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxxxx Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000
Office
NOTIFICATION/PRIMARY CONTACT:
Xxxxxxx Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
CONTACT FOR BORROWINGS, PAYMENTS, ETC.:
PAYMENT INSTRUCTIONS:
ABA # 026 005 487
Attention: Commercial Loan Operations
Reference: Royal Appliance Mfg. Co.
========================================================================================================================
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66
ANNEX II
INFORMATION AS TO SUBSIDIARIES
(as of May 1, 1998)
======================================================================================================================
PERCENTAGE OF
OUTSTANDING STOCK
NAME OF TYPE OF JURISDICTION OR OTHER EQUITY
SUBSIDIARY ORGANIZATION WHERE INTERESTS OWNED
ORGANIZED (INDICATING WHETHER
OWNED BY THE
BORROWER OR A
SPECIFIED SUBSIDIARY)
======================================================================================================================
Dirt Devil, Inc. corporation Ohio Wholly-Owned
----------------------------------------------------------------------------------------------------------------------
Royal Appliance Receivables, Inc. corporation Ohio Wholly-Owned
----------------------------------------------------------------------------------------------------------------------
Royal Appliance FSC, Inc. corporation U.S.V.I. Wholly-Owned
----------------------------------------------------------------------------------------------------------------------
Royal Appliance International Co. corporation Delaware Wholly-Owned
----------------------------------------------------------------------------------------------------------------------
RADDCO S.A. de C.V. corporation Mexico Wholly-Owned
======================================================================================================================
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ANNEX III
DESCRIPTION OF EXISTING INDEBTEDNESS
MetLife Capital Mortgage: Secured Indebtedness as indicated on the most recent balance sheet, for
Xxxxxxx Bldg. (assembly) ---will be gone 8/1/98 due to sale of facility; note
payable
Aegon USA Realty Advisors, Inc.: Secured Indebtedness as indicated on the most recent balance sheet, for Tyler
Bldg. (shipping); note payable
Syndicated Properties: Secured Indebtedness as indicated on the most recent balance sheet,
for a Capital Lease for Xxxx Facility (assembly and corporate
headquarters)
State Economic Development
Revenue Bonds (Ohio Enterprise
Bond Fund): Secured Indebtedness as indicated on the most recent balance sheet,
for a Capital Lease of the East 289th facility (assembly)
A receivables financing source which
has been identified to the Lenders Receivables program for the Receivables Subsidiary.
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68
ANNEX IV
DESCRIPTION OF EXISTING LIENS
1. Liens on the assets of the Receivables Subsidiary evidencing or
securing the receivables program identified in Annex III.
2. Other Liens described in Annex III.
83
69
ANNEX V
DESCRIPTION OF EXISTING ADVANCES, LOANS, INVESTMENTS AND GUARANTEES
----none----
84
70
ANNEX VI
DESCRIPTION OF LETTERS OF CREDIT DEEMED ISSUED UNDER
THE CREDIT AGREEMENT
===============================================================================================================
LETTER OF ORIGINAL DATE AND NO./ EXPIRATION
CREDIT ISSUER APPLICANT BENEFICIARY AMOUNT DATE
===============================================================================================================
National City Bank Borrower No. 4231, issued to $400,000 6/30/98
Provident Bank
(standby)
---------------------------------------------------------------------------------------------------------------
National City Bank Borrower No. 4232, issued to $312,500 6/30/98
Provident Bank
(standby)
---------------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxx Xxxx Xxxxxxxx Xx. 00000, issued to $846,744.12 8/1/98
Yamaha Electric
(import)
===============================================================================================================
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71
EXHIBIT A
REVOLVING NOTE
$_______________ Cleveland, Ohio
_________, 1998
FOR VALUE RECEIVED, the undersigned ROYAL APPLIANCE MFG. CO., an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _________________________ (the "LENDER"),
in lawful money of the United States of America in immediately available funds,
at the Payment Office (as defined in the Agreement referred to below) of
National City Bank (the "ADMINISTRATIVE AGENT"), on the Maturity Date (as
defined in the Agreement referred to below), the principal sum of
________________ DOLLARS ($__) or, if less, the then unpaid principal amount of
all Loans (as defined in the Agreement) made by the Lender to the Borrower
pursuant to the Agreement.
The Borrower promises also to pay interest on the unpaid principal
amount of each Loan made by the Lender to the Borrower in like money at said
office from the date hereof until paid at the rates and at the times provided in
section 2.7 of the Agreement.
This Note is one of the Notes referred to in the Credit Agreement,
dated as of May 1, 1998, among the Borrower, the financial institutions from
time to time party thereto (including the Lender), and National City Bank, as
Administrative Agent (as from time to time in effect, the "AGREEMENT"), and is
entitled to the benefits thereof and of the other Credit Documents (as defined
in the Agreement). As provided in the Agreement, this Note is subject to
mandatory prepayment prior to the Maturity Date, in whole or in part.
In case an Event of Default (as defined in the Agreement) shall occur
and be continuing, the principal of and accrued interest on this Note may be
declared to be due and payable in the manner and with the effect provided in the
Agreement.
The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY
THE LAW OF THE STATE OF OHIO.
ROYAL APPLIANCE MFG. CO.
By:
--------------------------------
Secretary
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LOANS AND PAYMENTS OF PRINCIPAL
===============================================================================================================
AMOUNT
OF
DATE AMOUNT TYPE PRINCIPAL UNPAID
OF OF OF INTEREST PAID OR PRINCIPAL MADE
NOTATION LOAN LOAN PERIOD PREPAID BALANCE BY
===============================================================================================================
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
===============================================================================================================
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73
EXHIBIT B-1
NOTICE OF BORROWING
[Date]
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Metro/Ohio Division
-------------------
Re: Notice of Borrowing
under Credit Agreement
----------------------
Ladies and Gentlemen:
The undersigned, Royal Appliance Mfg. Co. (the "BORROWER"), refers to
the Credit Agreement, dated as of May 1, 1998 (as amended from time to time, the
"CREDIT AGREEMENT", the terms defined therein being used herein as therein
defined), among the Borrower, the financial institutions from time to time party
thereto (the "LENDERS"), and National City Bank, as Administrative Agent for
such Lenders, and hereby gives you notice, irrevocably, pursuant to section
2.3(a) of the Credit Agreement, that the undersigned hereby requests one or more
Borrowings under the Credit Agreement, and in that connection sets forth in the
schedule attached hereto the information relating to each such Borrowing
(collectively the "PROPOSED BORROWING") as required by section 2.3(a) of the
Credit Agreement.
The Borrower hereby specifies that the Proposed Borrowing will
consist of Loans as indicated in the schedule attached hereto.
The Borrower hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are
and will be true and correct in all material respects, before and
after giving effect to the Proposed Borrowing and to the application
of the proceeds thereof, as though made on such date, except to the
extent that such representations and warranties expressly relate to
an earlier specified date, in which case such representations and
warranties shall have been true and correct in all material respects
as of the date when made; and
(B) no Default or Event of Default has occurred and is
continuing, or would result from such Proposed Borrowing or from the
application of the proceeds thereof.
Very truly yours,
ROYAL APPLIANCE MFG. CO.
By:
-------------------------------------
Title:
88
74
BORROWING SCHEDULE
PROPOSED BORROWING #1:
================================================================================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
PROPOSED BORROWING TYPE OF LOANS OF LOANS EURODOLLAR LOANS
--------------------------------------------------------------------------------
PRIME RATE ONE MONTH
_________________, LOANS
19____ $____________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle one
of Above] [Circle one of
above]
================================================================================
PROPOSED BORROWING #2:
================================================================================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
PROPOSED BORROWING TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle one
of Above] [Circle one of
above]
================================================================================
89
75
PROPOSED BORROWING #3:
================================================================================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
PROPOSED BORROWING TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle one
of Above] [Circle one of
above]
================================================================================
PROPOSED BORROWING #4:
================================================================================
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
PROPOSED BORROWING TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle one
of Above] [Circle one of
above]
================================================================================
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76
EXHIBIT B-2
NOTICE OF CONVERSION
[Date]
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Metro/Ohio Division
-------------------
Re: Notice of Conversion of Outstanding
Loans under Credit Agreement
----------------------------
Ladies and Gentlemen:
The undersigned, Royal Appliance Mfg. Co. (the "BORROWER"), refers to
the Credit Agreement, dated as of May 1, 1998 (as amended from time to time, the
"CREDIT AGREEMENT", the terms defined therein being used herein as therein
defined), among the Borrower, the financial institutions from time to time party
thereto (the "LENDERS"), and National City Bank, as Administrative Agent for
such Lenders, and hereby gives you notice, irrevocably, pursuant to section 2.6
of the Credit Agreement, that the undersigned hereby requests one or more
conversions of Loans of one Type into Loans of another Type, pursuant to section
2.6 of the Credit Agreement, and in that connection sets forth in the schedule
attached hereto the information relating to each such conversion.
Very truly yours,
ROYAL APPLIANCE MFG. CO.
By:
------------------------------
Title:
91
77
CONVERSION SCHEDULE
PROPOSED CONVERSION #1
[OF THE LOANS DESCRIBED IN THE FIRST TABLE BELOW
INTO LOANS DESCRIBED IN THE SECOND TABLE BELOW]
================================================================================
DATE INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
LOANS TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________________ Two Months
Eurodollar
Loans Three Months
[Circle One of Six Months
Above]
[Circle one of
above]
================================================================================
================================================================================
DATE INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
LOANS TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle One of [Circle one of
Above] above]
================================================================================
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78
PROPOSED CONVERSION #2
[OF THE LOANS DESCRIBED IN THE FIRST TABLE BELOW
INTO LOANS DESCRIBED IN THE SECOND TABLE BELOW]
================================================================================
DATE INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
LOANS TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
Prime Rate One Month
_________________, Loans
19____ $____________________ Two Months
Eurodollar
Loans Three Months
[Circle One of Six Months
Above]
[Circle one of
above]
================================================================================
================================================================================
DATE INTEREST PERIOD
OF AGGREGATE AMOUNT IF LOANS ARE
LOANS TYPE OF LOANS OF LOANS EURODOLLAR LOANS
================================================================================
PRIME RATE ONE MONTH
_________________, Loans
19____ $____________________ Two Months
Eurodollar
Loans Three Months
Six Months
[Circle One of [Circle one of
Above] above]
================================================================================
93
79
EXHIBIT B-3
LETTER OF CREDIT REQUEST
No. ______________(1)
Dated __________(2)
National City Bank,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Metro/Ohio Division
--------------------
Re: Letter of Credit Request under Credit Agreement,
dated as of May 1, 1998, to which
Royal Appliance Mfg. Co. is a party
-----------------------------------
Ladies and Gentlemen:
The undersigned, Royal Appliance Mfg. Co. (the "BORROWER"), refers to
the Credit Agreement, dated as of May 1, 1998 (as amended, modified or
supplemented from time to time, the "CREDIT AGREEMENT", the capitalized terms
defined therein being used herein as therein defined), among the Borrower, the
financial institutions from time to time party thereto (the "LENDERS"), and
National City Bank, as Administrative Agent for such Lenders.
he Borrower hereby requests that _______________, as a Letter of
Credit Issuer, issue a Letter of Credit on , 199__ (the "DATE OF ISSUANCE") in
the aggregate amount of U.S.$______, for the account of ____________________.
The beneficiary of the requested Letter of Credit will be
____________________,3 and such Letter of Credit will be in support of
____________________ 4 and will have a stated termination date of ____________.5
The Borrower hereby certifies that the following statements are true
on the date hereof, and will be true on the Date of Issuance:
(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are
and will be true and correct in all material respects, before and
after giving effect to the issuance of the Letter of Credit requested
hereby, as though made on the Date of Issuance, except to the
--------
(1) Letter of Request Number.
(2) Date of Letter of Request (at least three Business Days prior to the
Date of Issuance or such lesser number as may be agreed by the
relevant Letter of Credit Issuer).
(3) Insert name and address of beneficiary.
(4) Insert description of the supported obligations, name of agreement
and/or the commercial transaction to which this Letter of Credit
Request relates.
(5) Insert last date upon which drafts may be presented (which may not be
beyond the 15th Business Day next preceding the Maturity Date).
94
80
extent that such representations and warranties expressly relate to
an earlier specified date, in which case such representations and
warranties shall have been true and correct in all material respects
as of the date when made; and
(B) no Default or Event of Default has occurred and is
continuing, or would result after giving effect to the issuance of
the Letter of Credit requested hereby.
Copies of all documentation with respect to the supported transaction
are attached hereto.
Very truly yours,
ROYAL APPLIANCE MFG. CO.
By:
------------------------------------
Title:
95
81
EXHIBIT C
----------------------------
FORM OF
SECURITY AGREEMENT
----------------------------
96
82
EXHIBIT D
----------------------------
FORM OF
SUBSIDIARY GUARANTY
----------------------------
97
83
EXHIBIT E
FORM OF OPINION OF SPECIAL COUNSEL TO THE BORROWER
May ___, 1998
To each of the Lenders and the
Administrative Agent
named in the Credit Agreement
referred to below
c/o National City Bank
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Metro/Ohio Division
Re: Loans from National City Bank ("NCB"), and the Lenders
referred to in the Credit Agreement effective as of May ___,
1998 in the principal amount of up to $45,000,000 (the
"LOANS") to Royal APPLIANCE MFG. CO., AN OHIO CORPORATION
(THE "COMPANY").
Gentlemen:
We have acted as counsel to the Company in connection with the Loan
and have been requested to render our opinion respecting certain matters in
connection therewith. We have reviewed originals or copies of the following (the
"DOCUMENTS") (capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement):
1. Articles of Incorporation of the Company filed with the Ohio
Secretary of State on November 12, 1981 and Certificates of Amendment to
Articles of Incorporation of the Borrower filed with the Ohio Secretary of State
on December 11, 1981, December 18, 1986, June 13, 1988, June 11, 1990, August 7,
1991 and May 4, 1992 (collectively, the "ARTICLES OF INCORPORATION");
2. Code of Regulations of the Company adopted by its shareholders on
November 13, 1981 and amended on July 28, 1989, and amended and restated on
August 7, 1991 and on May 4, 1992 (the "CODE OF REGULATIONS");
3. Resolutions of the Board of Directors of the Company adopted at a
meeting held on April 27, 1998, as certified by the secretary of the Borrower;
4. Certificate of Good Standing for the Company from the Ohio
Secretary of State dated May ___, 1998;
5. Credit Agreement dated as of May 1, 1998 among the Borrower and
the Lenders (the "CREDIT AGREEMENT");
6. Security Agreement dated as of May 1, 1998 made by the Company to
NCB, in its capacity as Collateral Agent (the "SECURITY AGREEMENT");
7. Three (3) Promissory Notes of the Company issued to the Lenders
today pursuant to the Credit Agreement; and
8. Certificate of Fact from the Company to Kahn, Kleinman, Xxxxxxxx &
Xxxxxx Co., L.P.A., a copy of which is attached hereto and incorporated herein
by reference (the "CERTIFICATE").
98
84
Documents numbered 5 through 7 above are hereinafter collectively
referred to as the "LOAN DOCUMENTS".
Based on our review of the Documents and upon an investigation of
such questions of law as we have deemed necessary to enable us to render this
opinion, and assuming the accuracy of the Certificate, we are of the opinion
that:
1. The Company is a duly formed and validly existing Ohio corporation
in good standing as a domestic corporation under the laws of the State of Ohio.
2. To the best of our knowledge, based solely on the Certificate (and
without investigation, we are not aware that the Certificate is not true): (i)
Annex II to the Credit Agreement sets forth the name of each of Company's
subsidiaries and the jurisdiction in which each such subsidiary is incorporated;
and (ii) all of the issued and outstanding stock of each subsidiary set forth in
Annex II to the Credit Agreement is owned (directly or indirectly) by the
Company, free from any security interest, option, equity or other right of any
kind.
3. The Company has the requisite corporate power and authority to
enter into the Loan Documents to which it is a party and to perform its
obligations thereunder. The officers of the Company who have executed and
delivered the Loan Documents to which the Company is a party on behalf of the
Company have been duly authorized to do so. The Loan Documents to which the
Company is a party are valid and enforceable against the Company in accordance
with their respective terms.
4. To the best of our knowledge, based solely on the Certificate (and
without investigation, we are not aware that the Certificate is not true), no
order, consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, is
required to authorize or is required as a condition to (i) the execution,
delivery and performance by the Company of any of the Loan Documents to which it
is a party, or (ii) the legality, validity, binding effect or enforceability of
any Loan Document to which the Company is a party, except the filing and
recording of financing statements and other documents necessary in order to
perfect the Liens created by the Loan Documents.
5. Neither the Company's execution, delivery and performance of the
Loan Documents to which it is a party nor compliance with the terms and
provisions thereof (i) will, to the best of our knowledge, contravene any
provision of any law, statute, rule, regulation, order, writ, injunction or
decree of any court or governmental instrumentality applicable to the Company or
its properties and assets, (ii) will, to the best of our knowledge, conflict
with or result in any breach of any of the terms, covenants, conditions or
provisions of , or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien upon any of the
property or assets of the Company (other than the Liens provided for in the Loan
Documents) pursuant to the terms of any promissory note, bond, debenture,
indenture, mortgage, deed of trust, credit or loan agreement, or any other
material agreement or other instrument to which the Company is a party or by
which it or any of its property or assets are bound or to which it may be
subject, or (iii) will violate any provision of the Articles of Incorporation or
Code of Regulations of the Company.
6. To the best of our knowledge, based solely on the Certificate (and
without investigation we are not aware that the Certificate is not true), there
are no actions, suits or proceedings pending or threatened with respect to the
Company or any of its Subsidiaries (i) that individually or in the aggregate
have, or are reasonably likely to have, a Material Adverse Effect, or (ii) which
question the validity or enforceability of any of the Loan Documents, or of any
action to be taken by the Company pursuant to the Loan Documents.
7. The Borrower is not subject to regulation with respect to the
creation or incurrence of indebtedness under the Investment Company Act of 1940,
as amended, the Interstate Commerce Act, as amended, the Federal Power Act, as
amended, the Public Utility Holding Company Act of 1935, as amended or any
applicable state public utility law.
This opinion is subject to the assumptions, exceptions and
qualifications which follow.
In rendering this opinion, we have assumed: (1) the genuineness of
all signatures on documents and instruments other than those executed by the
Company; (2) the due delivery of all documents and instruments other than those
delivered
99
85
by the Company; (3) the legal capacity of all natural persons executing
documents and instruments; (4) the due authorization of all parties executing
documents and instruments, other than the Company, and that such documents and
instruments constitute the legal, valid and binding undertaking of each such
other party enforceable against each such other party in accordance with their
respective terms; (5) the authenticity of original documents and the conformity
of photostatic copies; (6) the Lenders and the Administrative Agent will enforce
their rights under the Loan Documents in a commercially reasonable manner,
consistent with good faith and fair dealing; and (7) no facts or circumstances
exist, including, without limitation, fraud or duress in the transaction giving
rise to the execution, acknowledgment and deliver of the Loan Documents which
would impair the enforceability of the Loan Documents.
This opinion is qualified to the extent that the binding effect and
enforceability of the agreements and instruments referred to above are subject
to: (1) applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws in effect from time to time affecting the rights of creditors
generally; (2) application of general principles of equity; and (3) limitations
upon certain of the remedies provided for in the Loan Documents, but in our
opinion adequate remedies are available under applicable law for the practical
realization of the benefits and security purported to be provided by the Loan
Documents. This opinion is further qualified to the extent that the binding
effect and enforceability of the agreements and instruments referred to above
are assumed to be governed by the choice of law chosen by the parties thereto,
and that a court of competent jurisdiction will apply either the laws of the
State of Ohio or the Federal law of the United States of America.
We specifically note, and exclude from the scope of our opinion, any
opinion as to: (1) the validity or enforceability of any provisions in the Loan
Documents that the rights and remedies available to the Administrative Agent or
the Lenders thereunder are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to or with any other remedy, or that
the election of some particular remedy or remedies does not preclude recourse to
one or more other remedies; and (2) the effect of any determination that the
foregoing provisions are unenforceable.
Our opinions concerning enforceability of the Loan Documents are
subject to the qualification that the availability of the remedy of specific
performance, or injunctive relief, or of any other equitable remedy, is subject
to the discretion of the court before which any proceedings therefore may be
brought.
This opinion is limited to the present laws of the State of Ohio and
the Federal laws of the United States of America, to present judicial
interpretations thereof, and to the facts as they presently exist. In rendering
this opinion, we assume no obligation to revise or supplement this opinion
should the present laws of any jurisdiction mentioned above be changed by
legislative action, judicial decision, or otherwise or should the facts as they
presently exist change.
Notwithstanding anything in the foregoing to the contrary, we express
no opinion whatsoever with respect to the enforcement of: (1) obligations for
the payment of attorneys' fees under any of the foregoing documents in
connection with the enforcement of any obligations thereunder; (2) increased
rates of interest or other charges payable upon default; (3) increased rates of
interest or other charges payable with respect to advances made for payment of
delinquent taxes or comparable items; (4) any "self-help" remedies exercised by
the Administrative Agent or one or more Lenders; (5) any EX PARTE judicial
proceedings brought by the Administrative Agent or one or more Lenders; (6)
waiver of any common law or statutory rights; (7) provisions permitting the
Administrative Agent or any Lender to act as attorney-in-fact for the Company or
any other person; and (8) provisions as to nonculpability for actions taken by
or on behalf of the Administrative Agent or any Lender.
The opinions expressed herein are qualified to the extent that the
validity, binding nature, and enforceability against Borrower of the Loan
Documents may be limited or otherwise affected by the unenforceability under
certain circumstances of provisions indemnifying or prospectively releasing a
party against liability for its own wrongful or negligent acts.
We express no opinion respecting compliance with, or the
applicability of, any state or federal securities or banking laws, rules, or
regulations to the transactions contemplated by the Loan Documents.
We express no opinion as to the title to, or ownership of, the
personal property contemplated as security by any of the Loan Documents, or the
status of any liens or encumbrances thereon, or the priority or perfection of
the liens and encumbrances which have been or may hereafter arise or be created
pursuant to the Loan Documents or any financing statements heretofore or
hereafter executed by the Company or any other person, or the accuracy or
sufficiency of the
100
86
description of any property or the freedom of any property from any liens and
encumbrances.
References to our "knowledge" or "aware" mean the actual knowledge or
actual awareness of Xxxxx X. Xxxxxx and Xxxxxxxx X. XxxXxxxxxx, the attorneys in
this firm who are directly involved in the representation of Borrower in
connection with the Loan.
We wish to advise you that certain attorneys in our Firm are
shareholders of Borrower.
We bring to your attention the fact that this letter and the opinions
set forth herein are expressions of professional judgment and are not a guaranty
of result.
The opinions contained herein are limited to those matters expressly
covered by Paragraphs 1 through 7 above; no opinion is to be implied with
respect to any other matter.
The opinions expressed herein are expressed solely to the
Administrative Agent and the Lenders named in the Credit Agreement, each of
which may rely hereon, and this opinion shall not be deemed to be extended to
any other person, firm or entity without the express prior written consent of
this Firm.
Very truly yours,
KAHN, KLEINMAN, XXXXXXXX & XXXXXX CO., L.P.A.
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87
CERTIFICATE OF FACT
-------------------
The undersigned, Royal Appliance Mfg. Co. (the "COMPANY"), in order
to induce Kahn, Kleinman, Xxxxxxxx & Xxxxxx Co., L.P.A. to issue its Opinion
Letter (the "OPINION") in connection with the loan transaction contemplated by
the Credit Agreement (the "CREDIT AGREEMENT") between the Borrower and National
City Bank, Administrative Agent for the Lenders, represents, warrants and
covenants that:
1. The Articles of Incorporation of the Company filed with the Ohio
Secretary of State on November 12, 1981 and Certificates of Amendment to
Articles of Incorporation filed with the Ohio Secretary of State on December 11,
1981, December 18, 1986, June 13, 1988, June 11, 1990, August 7, 1991 and May 4,
1992 have not been further amended, modified or superseded and remain in full
force.
2. The Code of Regulations of the Company, adopted by its
shareholders on November 13, 1981 and amended on July 28, 1989 and further
amended on May 4, 1992, has not been further amended, modified or superseded and
remains in full force.
3. The authorizing resolutions adopted at a meeting of the Board of
Directors of the Company held on April 27, 1998 have not been amended, modified
or superseded and remain in full force.
4. Annex II to the Credit Agreement contains a true and complete list
of each of the Company's domestic and foreign subsidiaries, all of the issued
and outstanding capital stock of which is owned by the Company free and clear of
any security interest, option, equity or other right of any kind except to the
extent, if any, set forth in said Annex II.
5. No order, consent, approval, license, authorization, or validation
of or filing, recording or registration with, or exemption by, any foreign or
domestic governmental or public body or authority, or any subdivision thereof,
is required to authorize or is required as a condition to (i) the execution,
delivery and performance by the Company of any Loan Documents to which it is a
party, or (ii) the legality, validity, binding effect or enforceability of any
Loan Document.
6. Neither the Company's execution, delivery and performance by the
Company of the Loan Documents to which it is a party nor compliance with the
terms and provisions thereof (i) will contravene any provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court or
governmental instrumentality applicable to the Company or its properties and
assets, or (ii) will conflict with or result in the creation or imposition of
(or the obligation to create or impose) any Lien upon any of the property or
assets of the Company (other than the Liens provided for in the Loan Documents)
pursuant to the terms of any promissory note, bond, debenture, indenture,
mortgage, deed of trust, credit or loan agreement, or any other material
agreement or other instrument to which the Company is a party or by which it or
any of its property or assets are bound or to which it may be subject.
7. There are no actions, suits or proceedings pending or threatened
with respect to the Company or any of its Subsidiaries (i) that individually or
in the aggregate have, or are reasonably likely to have, a Material Adverse
Effect, or (ii) which question the validity or enforceability of any of the Loan
Documents, or of any action to be taken by the Company pursuant to the Loan
Documents.
8. The Company is not subject to regulation with respect to the
creation or incurrence of indebtedness under the Investment Company Act of 1940,
as amended, the Interstate Commerce Act, as amended, the Federal Power Act, as
amended, the Public Utility Holding Company Act of 1935, as amended or any
applicable state public utility law.
Terms not otherwise defined herein shall have the same meaning as in
the Opinion.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Fact as of the date of the Opinion.
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ROYAL APPLIANCE MFG. CO.
By:
------------------------------------
Xxxxxxx Xxxxx, Secretary
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EXHIBIT F
----------------------------
FORM OF
ASSIGNMENT AGREEMENT
----------------------------
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ASSIGNMENT AGREEMENT
DATE:_____________
Reference is made to the Credit Agreement described in Item 2 of
Annex I annexed hereto (as such Credit Agreement may hereafter be amended,
modified or supplemented from time to time, the "CREDIT AGREEMENT"). Unless
defined in Annex I attached hereto, terms defined in the Credit Agreement are
used herein as therein defined.
_____________ (the "ASSIGNOR") and ______________ (the "ASSIGNEE")
hereby agree as follows:
1. The Assignor hereby sells and assigns to the Assignee without
recourse and without representation or warranty (other than as expressly
provided herein), and the Assignee hereby purchases and assumes from the
Assignor, that interest in and to all of the Assignor's rights and obligations
under the Credit Agreement as of the date hereof which represents the percentage
interest specified in Item 4 of Annex I (the "ASSIGNED SHARE") of all of
Assignor's outstanding rights and obligations under the Credit Agreement
indicated in Item 4 of Annex I, including, without limitation, all rights and
obligations with respect to the Assigned Share of the Assignor's Commitment and
of the Loans, Unpaid Drawings and the Notes held by the Assignor. After giving
effect to such sale and assignment, the Assignee's Commitment will be as set
forth in Item 4 of Annex I.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any liens or security interests; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the other Credit Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or the other Credit Documents or any other instrument or document
furnished pursuant thereto; and (iii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any of its Subsidiaries or the performance or observance by the
Borrower of any of its obligations under the Credit Agreement or the other
Credit Documents or any other instrument or document furnished pursuant thereto.
3. The Assignee (i) represents and warrants that it is duly
authorized to enter into and perform the terms of this Assignment Agreement;
(ii) confirms that it has received a copy of the Credit Agreement and the other
Credit Documents, together with copies of the financial statements referred to
therein and such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into this Assignment
Agreement; (iii) agrees that it will, independently and without reliance upon
the Administrative Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iv) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement and the other Credit Documents as are delegated to the Administrative
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; [and] (v) agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Credit Agreement
are required to be performed by it as a Lender[; and (vi) to the extent legally
entitled to do so, attaches the forms described in section 5.4(b)(ii) of the
Credit Agreement6.
4. Following the execution of this Assignment Agreement by the
Assignor and the Assignee, an executed original hereof (together with all
attachments) will be delivered to the Administrative Agent. The effective date
of this Assignment Agreement shall be the date of execution hereof by the
Assignor, the Assignee and the consent hereof by the Administrative Agent and
the receipt by the Administrative Agent of the administrative fee referred to in
section 12.4(b) of the Credit Agreement, unless otherwise specified in Item 5 of
Annex I hereto (the "SETTLEMENT DATE").
5. Upon the delivery of a fully executed original hereof to the
Administrative Agent, as of the Settlement
------------------------------
(6) If the Assignee is organized under the laws of a jurisdiction outside
the United States.
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Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment Agreement, have the rights and obligations of
a Lender thereunder and under the other Credit Documents and (ii) the Assignor
shall, to the extent provided in this Assignment Agreement, relinquish its
rights and be released from its obligations under the Credit Agreement and the
other Credit Documents.
6. It is agreed that upon the effectiveness hereof, the Assignee
shall be entitled to (x) all interest on the Assigned Share of the Loans at the
rates specified in Item 6 of Annex I, (y) all Commitment Fees (if applicable) on
the Assigned Share of the Commitment at the rate specified in Item 7 of Annex I,
and (z) all Letter of Credit Fees (if applicable) on the Assignee's
participation in all Letters of Credit at the rate specified in Item 8 of Annex
I hereto, which, in each case, accrue on and after the Settlement Date, such
interest and, if applicable, Commitment Fees and Letter of Credit Fees, to be
paid by the Administrative Agent, upon receipt thereof from the Borrower,
directly to the Assignee. It is further agreed that all payments of principal
made by the Borrower on the Assigned Share of the Loans which occur on and after
the Settlement Date will be paid directly by the Administrative Agent to the
Assignee. Upon the Settlement Date, the Assignee shall pay to the Assignor an
amount specified by the Assignor in writing which represents the Assigned Share
of the principal amount of the respective Loans made by the Assignor pursuant to
the Credit Agreement which are outstanding on the Settlement Date, net of any
closing costs, and which are being assigned hereunder. The Assignor and the
Assignee shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Settlement Date directly between themselves
on the Settlement Date.
7. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
[NAME OF ASSIGNOR], [NAME OF ASSIGNEE],
as Assignor as Assignee
By: By:
----------------------------- -----------------------------
Title: Title:
Acknowledged and Agreed:
NATIONAL CITY BANK,
as Administrative Agent
By:
--------------------------------
Vice President
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ANNEX I
FOR
ASSIGNMENT AND ASSUMPTION AGREEMENT
1. The Borrower: ROYAL APPLIANCE MFG. CO.
2. Name and Date of Credit Agreement:
Credit Agreement, dated as of May 1, 1998, among Royal
Appliance Mfg. Co., the Lenders from time to time party
thereto, and National City Bank, as Administrative Agent.
3. Date of Assignment Agreement:
--------- ---, -----
4. Amounts (as of date of item #3 above):
LOANS COMMITMENTS
---------------------------------------------------------------------------
Aggregate Amount for $_____ $_____
all Lenders
---------------------------------------------------------------------------
Assigned Share _____% _____%
---------------------------------------------------------------------------
Amount of Assigned Share $_____ $_____
---------------------------------------------------------------------------
Amount Retained by Assignor $_____ $_____
---------------------------------------------------------------------------
5. Settlement Date:
--------- ---, ---
6. Rate of Interest
to the Assignee: As set forth in section 2.7 of the Credit
Agreement (unless otherwise agreed to by the
Assignor and the Assignee).(7)
--------
(7) The Borrower and the Administrative Agent shall direct the entire
amount of the interest to the Assignee at the rate set forth in
section 2.7 of the Credit Agreement, with the Assignor and Assignee
effecting any agreed upon sharing of interest through payments by the
Assignee to the Assignor.
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7. Commitment
Fee: As set forth in section 4.1(a) of the
Credit Agreement (unless otherwise agreed
to by the Assignor and the Assignee).8
8. Letter of
Credit Fees: As set forth in section 4.1(b) of the
Credit Agreement (unless otherwise agreed
to by the Assignor and the Assignee).9
9. Notices:
--------------------------------------------------------------------------------
ASSIGNOR: ASSIGNEE:
Attention: Attention:
Telephone: Telephone:
Facsimile: Facsimile:
--------------------------------------------------------------------------------
10. Payment Instructions:
--------------------------------------------------------------------------------
ASSIGNOR: ASSIGNEE:
ABA No. ABA No.
Attention: Attention:
Telephone: Telephone:
Facsimile: Facsimile:
Ref.: Royal Appliance Mfg. Co. Ref.: Royal Appliance Mfg. Co.
--------------------------------------------------------------------------------
--------
(8) The Borrower and the Administrative Agent shall direct the entire
amount of the Commitment Fee to the Assignee at the rate set forth in
section 4.1(a) of the Credit Agreement, with the Assignor and the
Assignee effecting any agreed upon sharing of Commitment Fee through
payment by the Assignee to the Assignor.
(9) The Borrower and the Administrative Agent shall direct the entire
amount of the Letter of Credit Fees to the Assignee at the rate set
forth in section 4.1(b) of the Credit Agreement, with the Assignor
and the Assignee effecting any agreed upon sharing of the Letter of
Credit Fees through payment by the Assignee to the Assignor.
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EXHIBIT G
SECTION 5.4(b)(II) CERTIFICATE
Reference is hereby made to the Credit Agreement, dated as of May 1,
1998, among Royal Appliance Mfg. Co., the financial institutions party thereto
from time to time and National City Bank, as Administrative Agent (the "CREDIT
AGREEMENT"). Pursuant to the provisions of section 5.4(b)(ii) of the Credit
Agreement, the undersigned hereby certifies that it is not a "bank" as such term
is used in section 881(c)(3)(A) of the Internal Revenue Code of 1986, as
amended.
[NAME OF BANK]
By:
-------------------------------
Title:
Dated:__________
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================================================================================
CREDIT AGREEMENT
DATED AS OF
MAY 1, 1998
AMONG
ROYAL APPLIANCE MFG. CO.
AS BORROWER
THE LENDING INSTITUTIONS NAMED THEREIN
AS LENDERS
NATIONAL CITY BANK
AS ADMINISTRATIVE AGENT
================================================================================
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TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS AND TERMS......................................................1
1.1. CERTAIN DEFINED TERMS......................................................1
1.2. COMPUTATION OF TIME PERIODS...............................................16
1.3. ACCOUNTING TERMS..........................................................16
1.4. TERMS GENERALLY...........................................................16
SECTION 2. AMOUNT AND TERMS OF LOANS.................................................16
2.1. COMMITMENTS FOR LOANS.....................................................16
2.2. MINIMUM BORROWING AMOUNTS, ETC.; PRO RATA BORROWINGS......................17
2.3. NOTICE OF BORROWING.......................................................17
2.4. DISBURSEMENT OF FUNDS.....................................................17
2.5. NOTES.....................................................................18
2.6. CONVERSIONS...............................................................18
2.7. INTEREST..................................................................19
2.8. INTEREST PERIODS..........................................................21
2.9. INCREASED COSTS, ILLEGALITY, ETC..........................................22
2.10. BREAKAGE COMPENSATION.....................................................23
2.11. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS..........................23
SECTION 3. LETTERS OF CREDIT.........................................................24
3.1. LETTERS OF CREDIT.........................................................24
3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE............................25
3.3. AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS..............................25
3.4. LETTER OF CREDIT PARTICIPATIONS...........................................26
3.5. INCREASED COSTS...........................................................28
3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS.......................28
SECTION 4. FEES; COMMITMENTS.........................................................29
4.1. FEES......................................................................29
4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS............................31
4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC.....................31
4.4. EXTENSION OF MATURITY DATE................................................31
SECTION 5. PAYMENTS..................................................................32
5.1. VOLUNTARY PREPAYMENTS.....................................................32
5.2. MANDATORY PREPAYMENTS.....................................................32
5.3. METHOD AND PLACE OF PAYMENT...............................................33
5.4. NET PAYMENTS..............................................................34
SECTION 6. CONDITIONS PRECEDENT......................................................35
6.1. CONDITIONS PRECEDENT AT CLOSING DATE......................................35
6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS.................................36
SECTION 7. REPRESENTATIONS AND WARRANTIES............................................37
7.1. CORPORATE STATUS, ETC.....................................................37
7.2. SUBSIDIARIES..............................................................37
7.3. CORPORATE POWER AND AUTHORITY, ETC........................................37
7.4. NO VIOLATION..............................................................37
7.5. GOVERNMENTAL APPROVALS....................................................37
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Page
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7.6. LITIGATION.................................................................37
7.7. USE OF PROCEEDS; MARGIN REGULATIONS........................................38
7.8. FINANCIAL STATEMENTS, ETC..................................................38
7.9. NO MATERIAL ADVERSE CHANGE.................................................39
7.10. TAX RETURNS AND PAYMENTS...................................................39
7.11. TITLE TO PROPERTIES, ETC...................................................39
7.12. LAWFUL OPERATIONS, ETC.....................................................39
7.13. ENVIRONMENTAL MATTERS......................................................39
7.14. COMPLIANCE WITH ERISA......................................................40
7.15. INTELLECTUAL PROPERTY, ETC.................................................40
7.16. INVESTMENT COMPANY.........................................................40
7.17. BURDENSOME CONTRACTS; LABOR RELATIONS......................................40
7.18. EXISTING INDEBTEDNESS......................................................41
7.19. YEAR 2000 COMPUTER MATTERS.................................................41
7.20. SECURITY INTERESTS.........................................................41
7.21. TRUE AND COMPLETE DISCLOSURE...............................................41
SECTION 8. AFFIRMATIVE COVENANTS......................................................42
8.1. REPORTING REQUIREMENTS.....................................................42
8.2. BOOKS, RECORDS AND INSPECTIONS.............................................44
8.3. INSURANCE..................................................................45
8.4. PAYMENT OF TAXES AND CLAIMS................................................45
8.5. CORPORATE FRANCHISES.......................................................45
8.6. GOOD REPAIR................................................................45
8.7. COMPLIANCE WITH STATUTES, ETC..............................................46
8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS.........................................46
8.9. FISCAL YEARS, FISCAL QUARTERS..............................................47
8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY AND SECURITY AGREEMENT.47
8.11. HEDGE AGREEMENTS, ETC......................................................47
8.12. SENIOR DEBT................................................................47
SECTION 9. NEGATIVE COVENANTS.........................................................48
9.1. CHANGES IN BUSINESS........................................................48
9.2. CONSOLIDATION, MERGER, ACQUISITIONS, SALE OF ASSETS, ETC...................48
9.3. LIENS......................................................................49
9.4. INDEBTEDNESS...............................................................50
9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS......................50
9.6. DIVIDENDS, ETC.............................................................51
9.7. CONSOLIDATED TOTAL INDEBTEDNESS/CONSOLIDATED EBITDA RATIO..................52
9.8. INTEREST COVERAGE RATIO....................................................52
9.9. RATIO OF CONSOLIDATED TOTAL LIABILITIES TO CONSOLIDATED NET WORTH..........52
9.10. MINIMUM CONSOLIDATED NET WORTH.............................................52
9.11. TRANSACTIONS WITH AFFILIATES...............................................52
9.12. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS...............................52
9.13. PLAN TERMINATIONS, MINIMUM FUNDING, ETC....................................53
SECTION 10. EVENTS OF DEFAULT..........................................................53
10.1. EVENTS OF DEFAULT..........................................................53
10.2. ACCELERATION, ETC..........................................................55
10.3. APPLICATION OF LIQUIDATION PROCEEDS........................................55
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Page
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SECTION 11. THE ADMINISTRATIVE AGENT..................................................56
11.1. APPOINTMENT...............................................................56
11.2. DELEGATION OF DUTIES......................................................56
11.3. EXCULPATORY PROVISIONS....................................................56
11.4. RELIANCE BY ADMINISTRATIVE AGENT..........................................57
11.5. NOTICE OF DEFAULT.........................................................57
11.6. NON-RELIANCE..............................................................57
11.7. INDEMNIFICATION...........................................................58
11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY...........................58
11.9. SUCCESSOR ADMINISTRATIVE AGENT............................................58
11.10. OTHER AGENTS..............................................................58
SECTION 12. MISCELLANEOUS.............................................................58
12.1. PAYMENT OF EXPENSES ETC...................................................58
12.2. RIGHT OF SETOFF...........................................................60
12.3. NOTICES...................................................................60
12.4. BENEFIT OF AGREEMENT......................................................60
12.5. NO WAIVER: REMEDIES CUMULATIVE............................................62
12.6. PAYMENTS PRO RATA.........................................................62
12.7. CALCULATIONS: COMPUTATIONS................................................62
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL....62
12.9. COUNTERPARTS..............................................................63
12.10. EFFECTIVENESS.............................................................63
12.11. HEADINGS DESCRIPTIVE......................................................63
12.12. AMENDMENT OR WAIVER.......................................................63
12.13. SURVIVAL OF INDEMNITIES...................................................64
12.14. DOMICILE OF LOANS.........................................................64
12.15. CONFIDENTIALITY...........................................................64
12.16. LENDER REGISTER...........................................................64
12.17. LIMITATIONS ON LIABILITY OF THE LETTER OF CREDIT ISSUERS..................65
12.18. GENERAL LIMITATION OF LIABILITY...........................................65
12.19. NO DUTY...................................................................65
12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC..........................65
12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES................................66
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ANNEX I - INFORMATION AS TO LENDERS
ANNEX II - INFORMATION AS TO SUBSIDIARIES
ANNEX III - DESCRIPTION OF EXISTING INDEBTEDNESS
ANNEX IV - DESCRIPTION OF EXISTING LIENS
ANNEX V - DESCRIPTION OF EXISTING ADVANCES, LOANS,
INVESTMENTS AND GUARANTEES
ANNEX VI - DESCRIPTION OF LETTERS OF CREDIT DEEMED ISSUED
UNDER THE CREDIT AGREEMENT
EXHIBIT A - FORM OF NOTE
EXHIBIT B-1 - FORM OF NOTICE OF BORROWING
EXHIBIT B-2 - FORM OF NOTICE OF CONVERSION
EXHIBIT B-3 - FORM OF LETTER OF CREDIT REQUEST
EXHIBIT C - FORM OF SECURITY AGREEMENT
EXHIBIT D - FORM OF SUBSIDIARY GUARANTY
EXHIBIT E - FORM OF OPINION OF SPECIAL COUNSEL TO THE BORROWER
EXHIBIT F - FORM OF ASSIGNMENT AGREEMENT
EXHIBIT G - FORM OF SECTION 5.4(b)(ii) CERTIFICATE
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