WINSLOEW FURNITURE, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT (this "Agreement") is dated as of May 8, 2001 and
entered into by and among WINSLOEW FURNITURE, INC., a Florida corporation
("Borrower"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF OR
PARTY FROM TIME TO TIME HERETO (each individually referred to herein as a
"Lender" and collectively as "Lenders"), CIBC INC., as swing line lender (in
such capacity, the "Swing Line Lender"), CANADIAN IMPERIAL BANK OF COMMERCE,
acting through one or more of its agencies, branches or affiliates ("CIBC"), as
administrative agent for Lenders (in such capacity, "Administrative Agent"), and
CIBC WORLD MARKETS CORP., as lead arranger and bookrunner (in such capacity,
"Lead Arranger").
R E C I T A L S
WHEREAS, Borrower, Xxxxx Xxxxxx International, Inc., a Delaware
corporation ("BJI") and the Sellers (this and other capitalized terms used in
these recitals without definition being used as defined in subsection 1.1) have
entered into the Acquisition Agreement, pursuant to which Borrower has agreed to
acquire all of the outstanding shares of capital stock of BJI (such acquisition
is hereinafter referred to as the "Acquisition");
WHEREAS, the Acquisition Agreement provides that, on or before the
Closing Date, WLFI Holdings, Inc., a Florida corporation ("Holdings") shall
issue approximately 850,497 shares of its common stock to Trivest, Inc., a
Florida corporation ("Trivest"), affiliates of Trivest, the Management
Investors, and participants in Borrower's 1999 Key Employee Equity Plan
(collectively, the "WLFI Shareholders") in exchange for all of the outstanding
shares of common stock of Borrower;
WHEREAS, the Acquisition Agreement further provides that, on or before
the Closing Date, Holdings shall issue approximately 335,437 additional shares
of its common stock to certain investors (the "Cash Investors") in exchange for
an aggregate cash contribution of approximately $50,818,651 by the Cash
Investors to Holdings (such contribution is hereinafter referred to as the "Cash
Contribution" and the proceeds of the Cash Contribution are hereinafter referred
to as the "Cash Contribution Proceeds");
WHEREAS, the Acquisition Agreement further provides that, on the
Closing Date, Holdings shall issue 6,735 additional shares of its common stock
to the participating shareholders of BJI (the "BJI Investors") in exchange for
approximately 108,548 shares of common stock of BJI ("BJI Common Stock") (such
exchange is hereinafter referred to as the "BJI Exchange");
WHEREAS, the Acquisition Agreement further provides that, on the
Closing Date, Holdings shall issue Series A and Series B unsecured senior
subordinated promissory notes to the BJI Investors in an aggregate amount of
$22,000,000 in exchange for approximately 2,340,426 shares of BJI Common Stock
(such promissory notes are hereinafter referred to as the "Holdings Notes");
WHEREAS, the Acquisition Agreement further provides that, on or before
the Closing Date, Holdings shall invest all of the Cash Contribution Proceeds
into Borrower;
WHEREAS, Borrower desires that Lenders extend certain credit facilities
to Borrower, the proceeds of which will be used, together with the Cash
Contribution Proceeds, to provide funds for:
(i) the payment of approximately $77,274,046 in cash to the
shareholders of BJI (other than the BJI Investors, the Cash Investors and
Holdings) to purchase shares of BJI Common Stock, which shares represent all of
the remaining shares of BJI Common Stock not acquired by Holdings in connection
with the BJI Exchange and the issuance of the Holdings Notes;
(ii) the refinancing of approximately $139,500,000 of funded
Indebtedness under Borrower's and BJI's existing credit
facilities (the "Refinancing");
(iii) fund seasonal working capital for Borrower and its Subsidiaries;
(iv) general corporate purposes of Borrower and its Subsidiaries; and
(v) the payment of the Transaction Costs related to the Acquisition;
WHEREAS, on the Closing Date, Holdings will contribute to Borrower all
the shares of BJI Common Stock acquired by Holdings in connection with the BJI
Exchange and the issuance of the Holdings Notes (the "Share Contribution"), at
which time all of the outstanding shares of capital stock of BJI will be owned
beneficially and of record by Borrower;
WHEREAS, Borrower desires to secure all of the Obligations hereunder
and under the other Loan Documents by granting to Administrative Agent, on
behalf of Lenders, a First Priority Lien on substantially all of its real,
personal and mixed property, including a pledge of all of the capital stock of
each of its domestic Subsidiaries and 65% of the capital stock of its foreign
Subsidiaries; and
WHEREAS, Holdings and all of the domestic Subsidiaries of Borrower,
including BJI and its domestic Subsidiaries, have agreed to guarantee the
Obligations hereunder and under the other Loan Documents and to secure their
guaranties by granting to Administrative Agent, on behalf of Lenders, a First
Priority Lien on substantially all of their respective real, personal and mixed
property, including a pledge of all of the capital stock of each of their
respective domestic Subsidiaries and 65% of the capital stock of their
respective foreign Subsidiaries:
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrower, Lenders and Administrative
Agent agree as follows:
Section 1. DEFINITIONS
1.1 Certain Defined Terms.
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The following terms used in this Agreement shall have the
following meanings:
"Accounts" means all present and future rights of Borrower to payment
for goods sold or leased or for services rendered (including any such rights
evidenced by instruments or chattel paper), whether due or to become due,
whether now existing or hereinafter arising and wherever arising, and whether or
not they have been earned by performance.
"Acquisition" has the meaning assigned to that term in the Recitals to
this Agreement.
"Acquisition Agreement" means that certain Stock Purchase Agreement by
and among Holdings, Borrower, BJI and the Sellers dated as of May 8, 2001
(including the Exhibits and the Schedules attached thereto), in the form
delivered to Administrative Agent and Lenders prior to their execution of this
Agreement.
"Acquisition Revolving Loans" has the meaning assigned to that term in
subsection 2.5A.
"Additional Mortgage" has the meaning assigned to that term in
subsection 6.9B.
"Additional Mortgaged Property" has the meaning assigned to that term
in subsection 6.9B.
"Adjusted LIBOR" means, for any Interest Rate Determination Date with
respect to an Interest Period for a LIBOR Loan, the rate per annum obtained by
dividing (x) the rate of interest equal to (a) the rate per annum determined on
the basis of the rate for deposits in Dollars for a period equal to such
Interest Period commencing on the first day of such Interest Period and
appearing on Telerate Screen 3750 at or about 11:00 A.M., London time, two
Business Days prior to the commencement of such Interest Period, or (b) if such
a rate does not appear on Telerate Screen 3750, the average of the rates per
annum at which Dollar deposits in immediately available funds are offered to
CIBC in the interbank LIBOR market as at or about 11:00 A.M. (New York City
time) two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and for a period
approximately equal to such Interest Period, by (y) a percentage equal to 100%
minus the stated maximum rate (expressed as a percentage) of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable on such Interest Rate Determination Date 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).
"Administrative Agent" has the meaning assigned to that term in the
introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"Administrative Agent's Office" means (i) the office of Administrative
Agent and Swing Line Lender located at CIBC, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX
00000, or (ii) such other office of Administrative Agent and Swing Line Lender
as may from time to time hereafter be designated as such in a written notice
delivered by Administrative Agent and Swing Line Lender to Borrower and each
Lender.
"Affected Lender" has the meaning assigned to that term in subsection
2.6C.
"Affected Loans" has the meaning assigned to that term in subsection
2.6C.
"Affiliate", as applied to any Person, means (a) any partner, officer,
shareholder or member (if holding more than 10% of the outstanding equity
interests of such Person), director, manager, employee or managing agent of such
Person, (b) any spouse, parents, siblings, children or grandchildren of such
Person, (c) any corporation, limited liability company, association,
partnership, trust, entity or enterprise in which such Person is a director,
officer, manager or general partner, and (d) any other Person (other than a
Subsidiary) that, (i) directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such given
Person, (ii) directly or indirectly beneficially owns or holds 10% or more of
any class of voting stock or partnership or membership or other voting interest
of such Person or any Subsidiary of such Person, or (iii) 10% or more of the
voting stock or partnership or membership or other voting interest of which is
directly or indirectly beneficially owned or held by such Person or a Subsidiary
of such Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting Securities or
by contract or otherwise. Notwithstanding the foregoing, neither Administrative
Agent nor any Lender shall be deemed to be an Affiliate of any of the Loan
Parties.
"Agreement" means this Credit Agreement.
"Applicable Base Rate Margin" means, as at any date of determination,
with respect to any Type of Loan that is a Base Rate Loan, a percentage per
annum equal to the Applicable LIBOR Margin for such Type of Loan less 1.00%.
"Applicable LIBOR Margin" means (a) with respect to Term Loans that are
LIBOR Loans, 4.00% per annum, and (b) with respect to Revolving Loans that are
LIBOR Loans, a percentage per annum as set forth below opposite the applicable
Consolidated Total Leverage Ratio:
Consolidated Total Leverage Ratio Applicable LIBOR Margin
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greater than or equal to 4.25:1.00 3.50%
less than 4.25:1.00 3.25%
but greater than or equal to 3.75:1.00
less than 3.75:1.00 3.00%
but greater than or equal to 3.25:1.00
less than 3.25:1.00 2.75%
but greater than or equal to 2.75:1.00;
less than 2.75:1.00 2.50%
; provided that until the date that is five Business Days after the date on
which Borrower delivers the first Margin Determination Certificate required to
be delivered to Administrative Agent pursuant to subsection 6.1(xvi), the
Applicable LIBOR Margin for Revolving Loans that are LIBOR Loans shall be 3.50%.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Articles of Merger" means those certain Articles of Merger executed in
connection with the Merger, as in effect on the Closing Date.
"Asset Sale" means the sale (in any single transaction or related
series of transactions) by Borrower or any of its Subsidiaries to any Person
other than Borrower or any of its wholly-owned domestic Subsidiaries of (i) any
of the capital stock or other equity or ownership interests of any of Borrower's
Subsidiaries, (ii) substantially all of the assets of any division or line of
business of Borrower or any of its Subsidiaries, or (iii) any other assets
(whether tangible or intangible) of Borrower or any of its Subsidiaries (other
than (a) Inventory sold in the ordinary course of business, (b) dispositions of
worn-out and obsolete equipment no longer useful in Borrower's business,
consistent with past practices of Borrower and BJI, and (c) any such other
assets to the extent that the aggregate fair market value of such assets sold in
any twelve-month period is less than $750,000).
"Assignment Agreement" means an Assignment Agreement in substantially
the form of Exhibit XI annexed hereto.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute.
"Base Rate" means, at any time, the higher of (x) the Reference Rate or
(y) the rate which is one half of 1% in excess of the Federal Funds Effective
Rate.
"Base Rate Loans" means Loans bearing interest at rates determined by
reference to the Base Rate as provided in subsection 2.2A.
"BJI" means Xxxxx Xxxxxx International, Inc., a Delaware corporation,
and includes each and every Subsidiary thereof.
"BJI Common Stock" has the meaning assigned to that term in the
Recitals to this Agreement.
"BJI Exchange" has the meaning assigned to that term in the Recitals to
this Agreement.
"BJI Investors" has the meaning assigned to that term in the Recitals
to this Agreement.
"BJI Mexico" means Maquilados Tecnicos, S.A. de C.V., a corporation
organized under the laws of Mexico.
"Borrower" has the meaning assigned to such term in the introduction to
this Agreement.
"Borrower Common Stock" means the common stock of Borrower.
"Borrowing Base" means (i) the sum of (a) 85% of the face amount of
Eligible Accounts Receivable, and (b) 60% of the lower of the cost or fair
market value of Eligible Inventory, less (ii) the amount of the obligations
secured by Permitted Encumbrances on such Eligible Accounts or such Eligible
Inventory.
"Borrowing Base Certificate" means a certificate substantially in the
form of Exhibit IV annexed hereto delivered to Administrative Agent and Lenders
by Borrower pursuant to subsection 4.1X or subsection 6.1(i).
"Business Day" means (i) any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New York or is a day on
which banking institutions located in such state are authorized or required by
law or other governmental action to close, and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Adjusted LIBOR or
any LIBOR Loan, any day that (a) is a Business Day described in clause (i)
above, and (b) is a day for trading by and between banks in Dollar deposits in
the London Interbank Market.
"Capital Lease", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Cash" means money, currency or a credit balance in a Deposit Account.
"Cash Contribution" has the meaning assigned to such term in the
Recitals to this Agreement.
"Cash Contribution Proceeds" has the meaning assigned to such term in
the Recitals to this Agreement.
"Cash Equivalents" means, as at any date of determination, (i)
securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality thereof or any state having
maturities of not more than one year after the date of acquisition; (ii)
certificates of deposit and Eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case with any Lender or
any domestic commercial bank or U.S. branch of a foreign commercial bank having
capital and surplus in excess of $250,000,000 and a Xxxxxxxx Bank Watch Rating
of "B" or better; (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses (i) and
(ii) above entered into with any financial institution meeting the
qualifications specified in said clause (ii); and (iv) commercial paper having
the highest rating obtainable from Xxxxx'x or S&P and in each case maturing
within 270 days after the date of acquisition.
"CIBC" has the meaning assigned to that term in the introduction to
this Agreement.
"Class" means, as applied to Lenders, each of the following two classes
of Lenders: (i) Lenders having Term Loan Exposure, and (ii) Lenders
having Revolving Loan Exposure.
"Closing Date" means May 8, 2001.
"Closing Date Mortgage" has the meaning assigned to that term in
subsection 4.1I(i).
"Closing Date Mortgage Policies" has the meaning assigned to that term
in subsection 4.1I(ii).
"Closing Date Mortgaged Property" has the meaning assigned to that term
in subsection 4.1I(i).
"Collateral" means, collectively, all of the real, personal and mixed
property (including capital stock) in which Liens are purported to be granted
pursuant to the Collateral Documents as security for the Obligations.
"Collateral Access Agreement" means any landlord waiver, mortgagee
waiver, bailee letter or any similar acknowledgement or agreement of any
landlord or mortgagee in respect of any Real Property Asset where any Collateral
is located or any warehouseman or processor in possession of any Inventory of
any Loan Party, substantially in the form of Exhibit XV annexed hereto with such
changes thereto as may be agreed to by Administrative Agent in the reasonable
exercise of its discretion.
"Collateral Account" has the meaning assigned to that term in the
Security Agreement.
"Collateral Documents" means the Security Agreement, the Mortgages, and
all other instruments or documents delivered by any Loan Party pursuant to this
Agreement or any of the other Loan Documents in order to grant to Administrative
Agent, on behalf of Lenders, a Lien on any real, personal or mixed property of
that Loan Party as security for the Obligations.
"Commitments" means the commitments of Lenders to make Loans as set
forth in subsection 2.1A.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit VIII annexed hereto delivered to Administrative Agent and Lenders by
Borrower pursuant to subsection 6.1(iv).
"Confidential Information Memorandum" means that certain Confidential
Information Memorandum relating to Borrower dated April 2001.
"Conforming Leasehold Interest" means any Leasehold Property as to
which the lessor has agreed in writing for the benefit of Administrative Agent
(which writing has been delivered to Administrative Agent), whether under the
terms of the applicable lease, under the terms of a Landlord Consent and
Estoppel, or otherwise, to the matters described in the definition of "Landlord
Consent and Estoppel," which interest, if a subleasehold or sub-subleasehold
interest, is not subject to any contrary restrictions contained in a superior
lease or sublease.
"Consolidated Capital Expenditures" means, for any period, the sum of
(i) the aggregate of all expenditures (whether paid in Cash or other
consideration or accrued as a liability and including that portion of Capital
Leases which is capitalized on the consolidated balance sheet of Borrower and
its Subsidiaries) by Borrower and its Subsidiaries during that period that, in
conformity with GAAP, are included in "additions to property, plant or
equipment" or comparable items reflected in the consolidated statement of cash
flows of Borrower and its Subsidiaries plus (ii) to the extent not covered by
clause (i) of this definition, the aggregate of all expenditures by Borrower and
its Subsidiaries during that period to acquire (by purchase or otherwise) the
business, property or fixed assets of any Person, or the capital stock or other
evidence of beneficial ownership of any Person that, as a result of such
acquisition, becomes a Subsidiary of Borrower.
"Consolidated Current Assets" means, as at any date of determination,
the total assets of Borrower and its Subsidiaries on a consolidated basis that
may properly be classified as current assets in conformity with GAAP, excluding
Cash and Cash Equivalents.
"Consolidated Current Liabilities" means, as at any date of
determination, the total liabilities of Borrower and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with GAAP, excluding the current portions of Funded Debt and Capital
Leases.
"Consolidated EBITDA" means, for any period, the sum of the amounts for
such period of (i) Consolidated Net Income, (ii) Consolidated Interest Expense,
(iii) provisions for taxes based on income, (iv) total depreciation expense, (v)
total amortization expense, and (vi) other non-recurring and non-cash items
reducing Consolidated Net Income, less interest income and any non-recurring and
non-cash items increasing Consolidated Net Income (determined by adding back
thereto any amounts deducted in the calculation of Consolidated Net Income that
were paid, incurred or accrued in violation of any of the provisions of this
Agreement), all of the foregoing as determined on a consolidated basis for
Borrower and its Subsidiaries in conformity with GAAP; provided that (a) the
Consolidated EBITDA for the third Fiscal Quarter of Fiscal Year 2000 shall be
deemed to be $13,853,000, (b) the Consolidated EBITDA for the fourth Fiscal
Quarter of Fiscal Year 2000 shall be deemed to be $22,308,000, and (c) the
Consolidated EBITDA for the first Fiscal Quarter of Fiscal Year 2001 shall be
deemed to be $14,044,000; provided, further, that all components of Consolidated
EBITDA for the period of four Fiscal Quarters ending at the end of each Fiscal
Quarter shall include or exclude, as the case may be, without duplication, such
components of Consolidated EBITDA attributable to any business or assets that
have been acquired or disposed of by Borrower or any of its Subsidiaries
(including businesses and assets acquired through mergers or consolidations)
after the first day of such period of four Fiscal Quarters and prior to the end
of such period, as determined in good faith by Borrower on a pro forma basis for
such period of four Fiscal Quarters as if such acquisition or disposition had
occurred on such first day of such period.
"Consolidated Excess Cash Flow" means, for any period, an amount (if
positive) equal to (a) Consolidated EBITDA, minus (b) increases (or plus
decreases) in working capital, minus (c) cash taxes paid, minus (d) Consolidated
Capital Expenditures to the extent permitted hereunder (other than Financed
CapEx), minus scheduled and any additional principal repayments of Indebtedness
to the extent permitted hereunder (other than prepayments of Revolving Loans
that are not accompanied by a reduction in the Revolving Loan Commitments) and
payments of interest on all such Indebtedness, in each case for such period,
determined in accordance with GAAP on a consolidated basis for Borrower and its
Subsidiaries.
"Consolidated Fixed Charges" means, for any period, the sum (without
duplication) of the amounts for such period of (i) Consolidated Interest
Expense, (ii) Cash payments for taxes based on income, and (iii) all scheduled
principal payments to be made by Borrower or any of its Subsidiaries (whether or
not such payments are actually made) on all Indebtedness of Borrower and its
Subsidiaries (including the principal component of all Capital Leases), all of
the foregoing as determined on a consolidated basis for Borrower and its
Subsidiaries in conformity with GAAP; provided that (a) the Consolidated Fixed
Charges for the third Fiscal Quarter of Fiscal Year 2000 shall be deemed to be
$9,500,000, (b) the Consolidated Fixed Charges for the fourth Fiscal Quarter of
Fiscal Year 2000 shall be deemed to be $12,500,000, and (c) the Consolidated
Fixed Charges for the first Fiscal Quarter of Fiscal Year 2001 shall be deemed
to be $8,600,000.
"Consolidated Interest Expense" means, for any period, total interest
expense (including that portion attributable to Capital Leases in accordance
with GAAP and capitalized interest) paid in Cash of Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of Borrower and its Subsidiaries, including all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing and net costs under Interest Rate Agreements, but
excluding, however, any amounts referred to in subsection 2.3 payable to
Administrative Agent and Lenders on or before the Closing Date.
"Consolidated Net Income" means, for any period, the net income (or
loss) of Borrower and its Subsidiaries on a consolidated basis for such period
taken as a single accounting period determined in conformity with GAAP; provided
that there shall be excluded (i) the income (or loss) of any Person (other than
a Subsidiary of Borrower) in which any other Person (other than Borrower or any
of its Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to Borrower or any of its
Subsidiaries by such Person during such period, (ii) the income of any
Subsidiary of Borrower to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary, (iii) any after-tax gains or losses attributable
to Asset Sales or returned surplus assets of any Pension Plan, and (iv) (to the
extent not included in clauses (i) through (iii) above) any net extraordinary
gains or net non-cash extraordinary losses.
"Consolidated Net Worth" means, as at any date of determination, the
sum of the capital stock and additional paid-in capital plus retained earnings
(or minus accumulated deficits) of Borrower and its Subsidiaries on a
consolidated basis determined in conformity with GAAP.
"Consolidated Senior Debt" means, as at any date of determination,
Consolidated Total Debt less the aggregate principal amount of all unsecured
Subordinated Indebtedness of Borrower and its Subsidiaries, determined on a
consolidated basis.
"Consolidated Senior Leverage Ratio" means, as at the last day of any
Fiscal Quarter, the ratio of (a) Consolidated Senior Debt as of the last day of
such Fiscal Quarter, to (b) Consolidated EBITDA for the four Fiscal Quarter
period then ended; provided, however, that for purposes of calculating the
Consolidated Senior Leverage Ratio, Consolidated Total Debt with respect to
Revolving Loans shall be deemed to be the daily average principal amount of
Revolving Loans outstanding during the twelve-month period then ended (it being
understood that the daily average principal amount of Revolving Loans
outstanding during each month set forth on Schedule 1.1(b) annexed hereto shall
be deemed to be the corresponding amount set forth on Schedule 1.1(b) for such
month).
"Consolidated Total Debt" means, as at any date of determination, the
aggregate principal amount of all Indebtedness of Borrower and its Subsidiaries,
determined on a consolidated basis.
"Consolidated Total Leverage Ratio" means, as at the last day of any
Fiscal Quarter, the ratio of (a) Consolidated Total Debt as of the last day of
such Fiscal Quarter, to (b) Consolidated EBITDA for the four Fiscal Quarter
period then ended; provided, however, that for purposes of calculating the
Consolidated Total Leverage Ratio, Consolidated Total Debt with respect to
Revolving Loans shall be deemed to be the daily average principal amount of
Revolving Loans outstanding during the twelve-month period then ended (it being
understood that the daily average principal amount of Revolving Loans
outstanding during each month set forth on Schedule 1.1(b) annexed hereto shall
be deemed to be the corresponding amount set forth on Schedule 1.1(b) for such
month).
"Contingent Obligation", as applied to any Person, means any direct or
indirect liability, contingent or otherwise, of that Person (i) with respect to
any Indebtedness, lease, dividend or other obligation of another if the primary
purpose or intent thereof by the Person incurring the Contingent Obligation is
to provide assurance to the obligee of such obligation of another that such
obligation of another will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect thereof, (ii)
with respect to any letter of credit issued for the account of that Person or as
to which that Person is otherwise liable for reimbursement of drawings, or (iii)
under Hedge Agreements. Contingent Obligations shall include (a) the direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the obligation of another, (b) the obligation to make
take-or-pay or similar payments if required regardless of non-performance by any
other party or parties to an agreement, and (c) any liability of such Person for
the obligation of another through any agreement (contingent or otherwise) (X) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (Y) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (X) or (Y) of this sentence, the primary purpose or
intent thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited.
"Contractual Obligation", as applied to any Person, means any provision
of any Security issued by that Person or of any material indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement to which Borrower or any of its Subsidiaries is a
party.
"Deposit Account" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"Dollars" and the sign "$" mean the lawful money of the United States
of America.
"Eligible Account Receivable" means an Account of a Loan Party that (i)
consists of the unpaid portion of the obligation stated on the invoice issued to
an Account debtor with respect to Inventory sold and shipped to or services
performed for such Account debtor in the ordinary course of business, net of any
credits or rebates owed by any Loan Party to such Account debtor, and (ii)
Administrative Agent, in its reasonable credit judgment, determines to meet all
of the following requirements:
(a) such Account is owned by a Loan Party and represents a complete
bona fide transaction which requires no further act under any circumstances on
the part of any Loan Party, to make such Account payable by the Account debtor;
(b) such Account was invoiced in accordance with the applicable
Sales Terms and is not past due more than 60 days after its
original due date;
(c) such Account does not arise out of any transaction with any Loan
Party or any Affiliate, director, officer, agent, stockholder, employee,
creditor, lessor or supplier of any Loan Party;
(d) such Account is not owing by an Account debtor more than 20% of
whose then-existing Accounts owing to Borrower and its Subsidiaries do not meet
the requirements set forth in clause (b) above;
(e) if the Account debtor with respect thereto is located outside of
the United States of America, the goods which gave rise to such Account were
shipped after receipt by the applicable Loan Party from the Account debtor of an
irrevocable letter of credit that has been confirmed by a financial institution
acceptable to Administrative Agent in its reasonable credit judgment and is in
form and substance acceptable to Administrative Agent, payable in the full face
amount of the face value of the Account in Dollars at a place of payment located
within the United States;
(f) the Account debtor with respect to such Account is not located in a
state which imposes conditions on the enforceability of Accounts with which
Borrower or any of its Subsidiaries has not complied;
(g) such Account is not subject to the Assignment of Claims Act of
1940, as amended from time to time, or any applicable law now or hereafter
existing similar in effect thereto, as determined in the sole discretion of
Administrative Agent, or to any provision prohibiting its assignment or
requiring notice of or consent to such assignment, unless all such required
notices have been given and such consents received such that such Account has
been validly assigned to Administrative Agent;
(h) No Loan Party is in breach of any express or implied representation
or warranty with respect to the goods the sale of which gave rise to such
Account;
(i) the Account debtor with respect to such Account is not insolvent or
the subject of any bankruptcy or insolvency proceedings of any kind or of any
other proceeding or action, threatened or pending, which might, in
Administrative Agent's sole judgment, have a materially adverse effect on such
Account debtor;
(j) the goods, the sale of which gave rise to such Account, were
shipped or delivered to Account debtor on an absolute sale basis and not on a
xxxx-and-hold sale basis, a consignment sale basis, a guaranteed sale basis, a
sale or return basis or on the basis of any other similar understanding, and
such goods have not been returned or rejected;
(k) such Account is not owing by an Account debtor or a group of
Account debtors who are Affiliates whose then-existing Accounts owing to the
Loan Parties exceed in face amount 20% of the total Eligible Accounts
Receivable;
(1) such Account is evidenced by an invoice or other documentation
that conforms to the applicable Sales Terms;
(m) such Account is a valid, legally enforceable obligation of the
Account debtor with respect thereto and is not subject to any present, or
contingent (and no facts exist which are the basis for any future), offset,
deduction or counterclaim, dispute or other defense on the part of such Account
debtor, provided only an amount equal to the amount of such offset, deduction,
counterclaim dispute or other defense shall be ineligible by reason thereof;
(n) such Account is not evidenced by chattel paper or an
instrument of any kind unless such chattel paper or instrument is
in the possession of Administrative Agent;
(o) such Account does not arise from the performance of warranty
services or out of account service charges by Borrower or any of its
Subsidiaries or other fees for the time value of money; and
(p) with respect to such Accounts, Administrative Agent, on behalf of
Lenders and Issuing Lender, has a valid First Priority Lien and such Account is
free of all Liens or other claims of all other Persons other than Liens
permitted under this Agreement.
"Eligible Assignee" means (A) (i) a commercial bank organized under the
laws of the United States or any state thereof; (ii) a savings and loan
association or savings bank organized under the laws of the United States or any
state thereof; (iii) a commercial bank organized under the laws of any other
country or a political subdivision thereof (provided that (x) such bank is
acting through a branch or agency located in the United States or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country); and (iv) any other entity which is an "accredited investor" (as
defined in Regulation D under the Securities Act) which extends credit or buys
loans as one of its businesses including insurance companies, mutual funds,
lease financing companies and investment funds and any Approved Funds; (B) a
Lender, an Affiliate of a Lender, or an Approved Fund; or (C) any other Person
(other than a natural Person) approved by (1) Administrative Agent, (2) in the
case of any assignment of a Revolving Loan, Issuing Lender, and (3) unless (x)
such Person is taking delivery of an assignment in connection with physical
settlement of a credit derivatives transaction, or (y) an Event of Default or
Potential Event of Default has occurred and is continuing, Borrower (each such
approval not to be unreasonably withheld or delayed); provided that no Affiliate
of Borrower shall be an Eligible Assignee. If the consent of Borrower to an
assignment to an Eligible Assignee is required hereunder (including a consent to
an assignment which does not meet the minimum assignment thresholds specified in
subsection 10.1B(i)), Borrower shall be deemed to have given its consent five
Business Days after the date notice thereof has been delivered by the assigning
Lender (through Administrative Agent) unless such consent is expressly refused
by Borrower prior to such fifth Business Day.
"Eligible Inventory" means items of Inventory of the Loan Parties held
for sale in the ordinary course of their business which Administrative Agent in
its reasonable credit judgment determines to meet all of the following
requirements:
(a) such Inventory is owned by Borrower or a Subsidiary Guarantor,
Administrative Agent, on behalf of Lenders and Issuing Lender, has a valid First
Priority Lien as to such Inventory, and such Inventory is subject to no other
Lien whatsoever other than Permitted Encumbrances arising by operation of law;
(b) such Inventory consists of raw materials, finished goods or
work-in-process;
(c) such Inventory is in good condition and meets all standards
applicable to such goods, their use or sale imposed by any governmental agency,
or department or division thereof, having regulatory authority over such
matters;
(d) such Inventory is currently either usable or saleable, at
prices approximating at least cost, in the normal course of a Loan
Party's business;
(e) such Inventory is not obsolete, slow moving or repossessed or used
goods taken in trade or returned goods which when added to the aggregate value
of returned goods included in Eligible Inventory at such time would exceed
$500,000;
(f) (i) such Inventory is located at the Juarez Facility (provided that
as of any date of determination no more than $3,500,000 of such Inventory shall
be Eligible Inventory), or (ii) such Inventory is located within the United
States at one of the locations listed in Schedule 1.1(a) annexed hereto or is in
transit to such a location;
(g) such Inventory was not produced in violation of the Fair Labor
Standards Act and subject to the so called "hot goods" provisions
contained in Title 29, Chapter 8, X.X.X.xx.xx. 215(a); and
(h) such Inventory is in the possession and control of a Loan Party
(including a common carrier under a xxxx of lading in such Loan Party's name)
and not any other third party and if located in a warehouse or other facility
leased by such Loan Party, the warehouseman or lessor has delivered to
Administrative Agent a lien waiver or subordination in such form, if any, as may
be requested by Administrative Agent.
"Employee Benefit Plan" means any "employee benefit plan" as defined in
Section 3(3) of ERISA which is or was maintained or contributed to by Borrower,
any of its Subsidiaries or any of their respective ERISA Affiliates.
"Employment Agreements" means (a) the employment agreement between BJI
and Xxxx Xxxxx, and (b) the employment agreement and severance agreement between
Borrower and Xxxxx Xxxxxx, in each case as in effect on the Closing Date.
"Environmental Claim" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any governmental authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials Activity, or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"Environmental Laws" means any and all current or future statutes, ordinances,
orders, rules, regulations, guidance documents, judgments, Governmental
Authorizations, or any other requirements of governmental authorities relating
to (i) environmental matters, including those relating to any Hazardous
Materials Activity, (ii) the generation, use, storage, transportation or
disposal of Hazardous Materials, or (iii) occupational safety and health,
industrial hygiene, land use or the protection of human, plant or animal health
or welfare, in any manner applicable to Borrower or any of its Subsidiaries or
any Facility, including the Comprehensive Environmental Response, Compensation,
and Liability Act (42 X.X.X.xx. 9601 et -- seq.), the Hazardous Materials
Transportation Act (49 X.X.X.xx. 1801 et seq.), the Resource Conservation and --
--- Recovery Act (42 X.X.X.xx. 6901 et seq.), the Federal Water Pollution
Control Act (33 X.X.X.xx. 1251 et seq.), -- --- -- --- the Clean Air Act (42
X.X.X.xx. 7401 et seq.), the Toxic Substances Control Act (15 X.X.X.xx. 2601 et
seq.), -- --- -- --- the Federal Insecticide, Fungicide and Rodenticide Act (7
U.S.C.ss.136 et seq.), the Occupational Safety and -- --- Health Act (29
X.X.X.xx. 651 et seq.), the Oil Pollution Act (33 X.X.X.xx. 2701 et seq.) and
the Emergency -- --- ------- Planning and Community Right-to-Know Act (42
X.X.X.xx. 11001 et seq.), each as amended or supplemented, any -- --- analogous
present or future state or local statutes or laws, and any regulations
promulgated pursuant to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means, as applied to any Person, (i) any corporation
that is a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) that is a member of a
group of trades or businesses under common control within the meaning of Section
414(c) of the Internal Revenue Code of which that Person is a member; and (iii)
any member of an affiliated service group within the meaning of Section 414(m)
or (o) of the Internal Revenue Code of which that Person, any corporation
described in clause (i) above or any trade or business described in clause (ii)
above is a member. Any former ERISA Affiliate of Borrower or any of its
Subsidiaries shall continue to be considered an ERISA Affiliate of Borrower or
such Subsidiary within the meaning of this definition with respect to the period
such entity was an ERISA Affiliate of Borrower or such Subsidiary and with
respect to liabilities arising after such period for which Borrower or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA Event" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect to any
Pension Plan (excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"Event of Default" means each of the events set forth in Section 8.
"Exchange Act" means the Securities Exchange Act of 1934.
"Facilities" means any and all real property (including all buildings,
fixtures or other improvements located thereon) now, hereafter or heretofore
owned, leased, operated or used by Borrower or any of its Subsidiaries or any of
their respective predecessors.
"Federal Funds Effective Rate" means, 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 Administrative Agent from three Federal funds brokers
of recognized standing selected by Administrative Agent.
"Financed CapEx" means Consolidated Capital Expenditures financed
entirely with the proceeds of Indebtedness to the extent permitted under this
Agreement.
"Financial Plan" has the meaning assigned to that term in subsection
6.1(xi).
"First Priority" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that (i) such
Lien is perfected and has priority over any other Lien on such Collateral (other
than Liens permitted pursuant to subsection 7.2), and (ii) such Lien is the only
Lien (other than Liens permitted pursuant to subsection 7.2) to which such
Collateral is subject.
"Fiscal Quarter" means a fiscal quarter of any Fiscal Year.
"Fiscal Year" means the fiscal year of Borrower and its Subsidiaries
ending on December 31 of each calendar year.
"Flood Hazard Property" means a Closing Date Mortgaged Property or an
Additional Mortgaged Property located in an area designated by the Federal
Emergency Management Agency as having special flood or mud slide hazards.
"Fund" means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Funded Debt", as applied to any Person, means all Indebtedness of that
Person (including any current portions thereof) which by its terms or by the
terms of any instrument or agreement relating thereto matures more than one year
from, or is directly renewable or extendable at the option of that Person to a
date more than one year from (including an option of that Person under a
revolving credit or similar agreement obligating the lender or lenders to extend
credit over a period of one year or more from), the date of the creation
thereof.
"Funding Date" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application thereof set
forth in subsection 1.2, generally accepted accounting principles set forth in
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession, in each case as the same are applicable to the circumstances as of
the date of determination.
"Governmental Authorization" means any permit, license, authorization,
plan, directive, consent order or consent decree of or from any federal, state
or local governmental authority, agency or court.
"Guaranties" means the Holdings Guaranty and the Subsidiary Guaranty.
"Hazardous Materials" means (i) any chemical, material or substance at
any time defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous waste", acutely
hazardous waste", "radioactive waste", "biohazardous waste", "pollutant", "toxic
pollutant", "contaminant", "restricted hazardous waste", "infectious waste",
"toxic substances", or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment (including harmful properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive
toxicity, "TCLP toxicity" or "EP toxicity" or words of similar import under any
applicable Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced waters and
other wastes associated with the exploration, development or production of crude
oil, natural gas or geothermal resources; (iv) any flammable substances or
explosives; (v) any radioactive materials; (vi) any asbestos-containing
materials; (vii) urea formaldehyde foam insulation; (viii) electrical equipment
which contains any oil or dielectric fluid containing polychlorinated biphenyls;
(ix) pesticides; and (x) any other chemical, material or substance, exposure to
which is prohibited, limited or regulated by any governmental authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Facility or to the indoor or outdoor
environment.
"Hazardous Materials Activity" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"Hedge Agreement" means an Interest Rate Agreement or a Currency
Agreement designed to hedge against fluctuations in interest rates or currency
values, respectively.
"Holdings" has the meaning assigned to that term in the Recitals to
this Agreement.
"Holdings Common Stock" means the common stock of Holdings.
"Holdings Guaranty" means the Holdings Guaranty executed and delivered
by Holdings on the Closing Date, substantially in the form of Exhibit XVII
annexed hereto, as such Holdings Guaranty may hereafter be amended, supplemented
or otherwise modified from time to time.
"Holdings Note Documents" means the Holdings Notes and all other
documents and agreements executed and delivered in connection with the issuance
of the Holdings Notes.
"Holdings Notes" has the meaning assigned to that term in the Recitals
to this Agreement.
"Holdings Options" has the meaning assigned to such term in the
Acquisition Agreement.
"Holdings Options Agreement" means that certain Holdings Option
Agreement, dated as of the Closing Date, by and between Holdings and such
persons who receive the Holdings Options, in the form delivered to
Administrative Agent and Lenders prior to their execution of this Agreement.
"Increasing Lender" has the meaning assigned to that term in subsection
2.1A(iv).
"Indebtedness", as applied to any Person, means (i) all indebtedness
for borrowed money, (ii) that portion of obligations with respect to Capital
Leases that is properly classified as a liability on a balance sheet in
conformity with GAAP, (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument, (v) all obligations in respect of any mandatorily redeemable
preferred capital stock of such Person, (vi) all indebtedness secured by any
Lien on any property or asset owned or held by that Person regardless of whether
the indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person, (vii) the face amount of all letters
of credit that such Person is obligated to reimburse the related letter of
credit bank for, and (viii) all Contingent Obligations of such Person in respect
of the foregoing. Obligations under Interest Rate Agreements and Currency
Agreements constitute (X) in the case of Hedge Agreements, Contingent
Obligations, and (Y) in all other cases, Investments, and in neither case
constitute Indebtedness.
"Indemnitee" has the meaning assigned to that term in subsection 10.3.
"Intellectual Property" means all patents, patent rights, patent
applications, licenses, inventions, trade secrets, trademarks, tradenames,
service marks, copyrights, technology, know-how and proprietary techniques
(including processes and substances) used in or necessary for the conduct of the
business of Borrower and its Subsidiaries as currently conducted that are
material to the condition (financial or otherwise), business or operations of
Borrower and its Subsidiaries, taken as a whole.
"Interest Payment Date" means (i) with respect to any Base Rate Loan,
the last Business Day of each March, June, September and December of each year,
commencing on the first such date to occur after the Closing Date, and (ii) with
respect to any LIBOR Loan, the last day of each Interest Period applicable to
such Loan; provided that in the case of each Interest Period of six months
"Interest Payment Date" shall also include the date that is three months after
the commencement of such Interest Period.
"Interest Period" has the meaning assigned to that term in subsection
2.2B.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement to which Borrower or any of its Subsidiaries is a
party.
"Interest Rate Determination Date" means, with respect to any Interest
Period, the second Business Day prior to the first day of such Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"Inventory" means, with respect to any Person as of any date of
determination, all goods, merchandise and other personal property which are then
held by such Person for sale or lease, including raw materials and work in
process.
"Investment" means (i) any direct or indirect purchase or other
acquisition by Borrower or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary of
Borrower), (ii) any direct or indirect redemption, retirement, purchase or other
acquisition for value, by any Subsidiary of Borrower from any Person other than
Borrower or any of its Subsidiaries, of any equity Securities of such
Subsidiary, (iii) any direct or indirect loan, advance (other than advances to
employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business for business expenses)
or capital contribution by Borrower or any of its Subsidiaries to any other
Person (other than a wholly-owned Subsidiary of Borrower), including all
indebtedness and accounts receivable from that other Person that are not current
assets or did not arise from sales to that other Person in the ordinary course
of business, or (iv) Interest Rate Agreements or Currency Agreements not
constituting Hedge Agreements. The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto, without
any adjustments for increases or decreases in value, or write-ups, write-downs
or write-offs with respect to such Investment.
"Investors Agreement" means that certain Amended and Restated
Investors' Agreement dated as of the Closing Date by and between Holdings and
the investors named therein, in the form delivered to Administrative Agent and
Lenders prior to their execution of this Agreement.
"IP Collateral" means, collectively, the Collateral consisting of
rights in or to intellectual property under the Security Agreement.
"IPO" means an initial public offering of voting Borrower Common Stock,
underwritten by a reputable securities underwriter in compliance with applicable
law, the net proceeds of which to Borrower are equal to or greater than
$15,000,000.
"Issuing Lender" means, with respect to any Letter of Credit, the
Lender which agrees or is otherwise obligated to issue such Letter of Credit,
determined as provided in subsection 3.1B(ii).
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
that in no event shall any corporate Subsidiary of any Person be considered to
be a Joint Venture to which such Person is a party.
"Juarez Facility" means the approximately 260,000 square foot Facility
located in the Xxxxxxx X. Xxxxxxxx Industrial Park in Ciudad Xxxxxx, Chihuahua,
Mexico, which Facility BJI Mexico leases from Parque Industrial Xxxxxxx X.
Xxxxxxxx, S.A. de C.V.
"Landlord Consent and Estoppel" means, with respect to any Leasehold
Property, a letter, certificate or other instrument in writing from the lessor
under the related lease, satisfactory in form and substance to Administrative
Agent, pursuant to which such lessor agrees, for the benefit of Administrative
Agent, (i) that without any further consent of such lessor or any further action
on the part of the Loan Party holding such Leasehold Property, such Leasehold
Property may be encumbered pursuant to a Mortgage and may be assigned to the
purchaser at a foreclosure sale or in a transfer in lieu of such a sale (and to
a subsequent third party assignee if Administrative Agent, any Lender, or an
Affiliate of either so acquires such Leasehold Property), (ii) that such lessor
shall not terminate such lease as a result of a default by such Loan Party
thereunder without first giving Administrative Agent notice of such default and
at least 60 days (or, if such default cannot reasonably be cured by
Administrative Agent within such period, such longer period as may reasonably be
required) to cure such default, (iii) to the matters contained in a Collateral
Access Agreement, and (iv) to such other matters relating to such Leasehold
Property as Administrative Agent may reasonably request.
"Lead Arranger" has the meaning assigned to that term in the
introduction to this Agreement.
"Leasehold Property" means (a) the Juarez Facility, and (b) any
leasehold interest of any Loan Party as lessee under any lease of real property,
other than any such leasehold interest designated from time to time by
Administrative Agent in its sole discretion as not being required to be included
in the Collateral.
"Lender" and "Lenders" means the Persons identified as "Lenders" and
listed on the signature pages of this Agreement, together with their successors
and permitted assigns pursuant to subsection 10.1, and the term "Lenders" shall
include Swing Line Lender unless the context otherwise requires; provided that
the term "Lenders", when used in the context of a particular Commitment, shall
mean Lenders having that Commitment.
"Letter of Credit" or "Letters of Credit" means any standby letter of
credit or similar instrument issued for the purpose of supporting (i)
Indebtedness of Borrower or any of its Subsidiaries in respect of industrial
revenue or development bonds or financings, (ii) workers' compensation
liabilities of Borrower or any of its Subsidiaries, (iii) the obligations of
third party insurers of Borrower or any of its Subsidiaries arising by virtue of
the laws of any jurisdiction requiring third party insurers, (iv) obligations
with respect to Capital Leases or Operating Leases of Borrower or any of its
Subsidiaries, and (v) performance, payment, deposit or surety obligations of
Borrower or any of its Subsidiaries, in any case if required by law or
governmental rule or regulation or in accordance with custom and practice in the
industry; provided that Letters of Credit may not be issued for the purpose of
supporting (a) trade payables or (b) any Indebtedness constituting "antecedent
debt" (as that term is used in Section 547 of the Bankruptcy Code).
"Letter of Credit Usage" means, as at any date of determination, the
sum of (i) the maximum aggregate amount which is or at any time thereafter may
become available for drawing under all Letters of Credit then outstanding plus
(ii) the aggregate amount of all drawings under Letters of Credit honored by
Issuing Lenders and not theretofore reimbursed by Borrower (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to subsection
3.3B).
"LIBOR Loans" means Loans bearing interest at rates determined by
reference to the Adjusted LIBOR as provided in subsection 2.2A.
"Lien" means any lien, mortgage, pledge, assignment, security interest,
charge or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"Loan" or "Loans" means one or more of the Term Loans, Revolving Loans
or Swing Line Loans or any combination thereof.
"Loan Documents" means this Agreement, the Notes, the Letters of Credit
(and any applications for, or reimbursement agreements or other documents or
certificates executed by Borrower in favor of an Issuing Lender relating to, the
Letters of Credit), the Guaranties and the Collateral Documents.
"Loan Party" means each of Borrower, Holdings and any of Borrower's
Subsidiaries from time to time executing a Loan Document, and "Loan Parties"
means all such Persons, collectively.
"Management Investors" means the management officers and employees of
Borrower and its Subsidiaries identified as Management Investors on Schedule
4.1C annexed hereto.
"Management Subscription Agreement" means that certain Exchange,
Contribution and Subscription Agreement, dated as of the Closing Date, by and
among Holdings and the individuals and entities set forth on Exhibits A, B and C
thereto, in the form delivered to Administrative Agent and Lenders prior to
their execution of this Agreement.
"Margin Determination Certificate" means an Officers' Certificate of
Borrower delivered (a) with respect to each Fiscal Quarter (other than each
fourth Fiscal Quarter), together with the three most recent financial statements
required pursuant to subsection 6.1(ii), and (b) with respect to each fourth
Fiscal Quarter, within 45 days of the last day of such fourth Fiscal Quarter,
setting forth in reasonable detail the Consolidated Total Leverage Ratio that is
applicable as of the last day of the fiscal period for which such financial
statements and Officers' Certificate are being delivered.
"Margin Stock" has the meaning assigned to that term in Regulation U of
the Board of Governors of the Federal Reserve System as in effect from time to
time.
"Material Adverse Effect" means any act, omission, situation,
circumstance, event or undertaking which could reasonably be expected to have,
singly or in any combination with one or more other acts, omissions, situations,
circumstances, events or undertakings, a materially adverse effect upon (a) the
business, assets, properties, liabilities, condition (financial or otherwise),
results of operations or business prospects of Borrower and its Subsidiaries
taken as a whole, (b) the value of the whole or any material part of the
Collateral, or the enforceability or priority of the security interest in the
Collateral, (c) the respective ability of Borrower or any of the other Loan
Parties to perform any obligations under this Agreement or any other Loan
Document to which it is a party, or (d) the legality, validity, binding effect,
enforceability or admissibility into evidence of any Loan Document or the rights
or remedies of Administrative Agent or Lenders under or in connection with any
Loan Document.
"Material Contract" means any contract or other arrangement to which
Borrower or any of its Subsidiaries is a party (other than the Loan Documents)
for which breach, nonperformance, cancellation or failure to renew could
reasonably be expected to have a Material Adverse Effect.
"Material Leasehold Property" means a Leasehold Property reasonably
determined by Administrative Agent to be of material value as Collateral or of
material importance to the operations of Borrower or any of its Subsidiaries
taken as a whole.
"Merger" means the merger of Merger Sub with and into Borrower with
Borrower as the surviving corporation.
"Merger Agreement" means that certain Agreement and Plan of Merger
dated as of the Closing Date by and among Holdings, Merger Sub and Borrower, in
the form delivered to the Administrative Agent and Lenders prior to their
execution of this Agreement.
"Merger Sub" means WLFI Merger, Inc., a Florida corporation.
"Mexican Subsidiaries" means BJI Mexico and Pompeii Mexico.
"Minimum Amount" means, with respect to each of the following actions,
the minimum amount and any multiples in excess thereof set forth opposite such
action:
Multiples in
Type of Action Minimum Amount excess thereof
Conversion into Base Rate Loans $150,000 $50,000
Conversion into LIBOR Loans $1,000,000 $100,000
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"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" means (i) a security instrument (whether designated as a
deed of trust or a mortgage or by any similar title) executed and delivered by
any Loan Party, substantially in the form of Exhibit XVI annexed hereto or in
such other form as may be approved by Administrative Agent in its sole
discretion, in each case with such changes thereto as may be recommended by
Administrative Agent's local counsel based on local laws or customary local
mortgage or deed of trust practices, or (ii) at Administrative Agent's option,
in the case of an Additional Mortgaged Property, an amendment to an existing
Mortgage, in form satisfactory to Administrative Agent, adding such Additional
Mortgaged Property to the Real Property Assets encumbered by such existing
Mortgage, in either case as such security instrument or amendment may be
amended, supplemented or otherwise modified from time to time. "Mortgages" means
all such instruments, including the Closing Date Mortgages and any Additional
Mortgages, collectively.
"Multiemployer Plan" means any Employee Benefit Plan that is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"Net Asset Sale Proceeds" means, with respect to any Asset Sale, Cash
payments (including any Cash received by way of deferred payment pursuant to, or
by monetization of, a note receivable or otherwise, but only as and when so
received) received from such Asset Sale, net of any bona fide direct costs
incurred in connection with such Asset Sale, including (i) income taxes
reasonably estimated to be actually payable within two years of the date of such
Asset Sale as a result of any gain recognized in connection with such Asset Sale
and (ii) payment of the outstanding principal amount of, premium or penalty, if
any, and interest on any Indebtedness (other than the Loans) that is secured by
a Lien on the stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale.
"Net Insurance/Condemnation Proceeds" means any Cash payments or
proceeds received by Borrower or any of its Subsidiaries (i) under any business
interruption or casualty insurance policy in respect of a covered loss
thereunder or (ii) as a result of the taking of any assets of Borrower or any of
its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of (a)
any actual and reasonable documented costs incurred by Borrower or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
Borrower or such Subsidiary in respect thereof, and (b) any amounts retained by
or paid to parties having superior rights, permitted by this Agreement, to such
proceeds, awards or payments.
"Net Securities Proceeds" means the Cash proceeds (net of underwriting
discounts and commissions and other reasonable costs and expenses associated
therewith, including reasonable legal fees and expenses) from the (i) issuance
of capital stock of or incurrence of Indebtedness by Borrower or any of its
Subsidiaries, and (ii) capital contributions made by a holder of capital stock
of Borrower.
"New Lender" has the meaning assigned to that term in subsection
2.1A(iv).
"Notes" means one or more of the Term Loan Notes, Revolving Notes or
Swing Line Notes or any combination thereof.
"Notice of Borrowing" means a notice substantially in the form of
Exhibit I annexed hereto delivered by Borrower to Administrative Agent pursuant
to subsection 2.1B with respect to a proposed borrowing.
"Notice of Conversion/Continuation" means a notice substantially in the
form of Exhibit II annexed hereto delivered by Borrower to Administrative Agent
pursuant to subsection 2.2D with respect to a proposed conversion or
continuation of the applicable basis for determining the interest rate with
respect to the Loans specified therein.
"Notice of Issuance of Letter of Credit" means a notice substantially
in the form of Exhibit III annexed hereto delivered by Borrower to
Administrative Agent pursuant to subsection 3.1B(i) with respect to the proposed
issuance of a Letter of Credit.
"Obligations" means all obligations of every nature of each Loan Party
from time to time owed to Administrative Agent, Lenders or any of them under the
Loan Documents, whether for principal, interest, reimbursement of amounts drawn
under Letters of Credit, fees, expenses, indemnification or otherwise, and
including all obligations arising under Revolving Loans made as a result of an
increase in the Revolving Loan Commitments under subsection 2.1A(iv).
"Officer" means the president, chief executive officer, a vice
president, chief financial officer, treasurer, general partner (if an
individual), managing member (if an individual) or other individual appointed by
the governing body or the organizational documents of a corporation,
partnership, trust or limited liability company to serve in a similar capacity
as the foregoing.
"Officers' Certificate," as applied to any Person that is a
corporation, partnership, trust or limited liability company, means a
certificate executed on behalf of such Person by one or more Officers of such
Person or one or more Officers of a general partner or a managing member if such
general partner or managing member is a corporation, partnership, trust or
limited liability company; provided that every Officers' Certificate with
respect to the compliance with a condition precedent to the making of any Loans
hereunder shall include (i) a statement that the officer or officers making or
giving such Officers' Certificate have read such condition and any definitions
or other provisions contained in this Agreement relating thereto, (ii) a
statement that, in the opinion of the signers, they have made or have caused to
be made such examination or investigation as is reasonably necessary to enable
them to express an informed opinion as to whether or not such condition has been
complied with, and (iii) a statement as to whether, in the opinion of the
signers, such condition has been complied with.
"Operating Lease" means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) that is not a Capital Lease other than any
such lease under which that Person is the lessor.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"Permitted Encumbrances" means the following types of Liens (excluding
any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the Internal
Revenue Code or by ERISA, any such Lien relating to or imposed in connection
with any Environmental Claim, and any such Lien expressly prohibited by any
applicable terms of any of the Collateral Documents):
(i) Liens for taxes, assessments or governmental
charges or claims the payment
of which is not, at the time, required by
subsection 6.3;
(ii) statutory Liens of landlords, statutory Liens of
banks and rights of set-off, statutory Liens of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen,
and other Liens imposed by law, in each case incurred in the
ordinary course of business (a) for amounts not yet overdue or
(b) for amounts that are overdue and that (in the case of any
such amounts overdue for a period in excess of 5 days) are
being diligently contested in good faith by appropriate
proceedings, so long as (1) such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have
been made for any such contested amounts, and (2) in the case
of a Lien with respect to any portion of the Collateral, such
contested proceedings conclusively operate to stay the sale of
any portion of the Collateral on account of such Lien;
(iii) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or
to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, government contracts, trade
contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment
of borrowed money), so long as no foreclosure, sale or similar
proceedings have been commenced with respect to any portion of
the Collateral on account thereof;
(iv) any attachment or judgment Lien not
constituting an Event of Default under
subsection 8.8;
(v) leases or subleases granted to third parties in
accordance with any applicable terms of the Collateral
Documents and not interfering in any material respect with the
ordinary conduct of the business of Borrower or any of its
Subsidiaries or resulting in a material diminution in the
value of any Collateral as security for the Obligations;
(vi) easements, rights-of-way, restrictions,
encroachments, and other minor defects or irregularities in
title, in each case which do not and will not interfere in any
material respect with the ordinary conduct of the business of
Borrower or any of its Subsidiaries or result in a material
diminution in the value of any Collateral as security for the
Obligations;
(vii) any (a) interest or title of a lessor or
sublessor under any lease permitted by subsection 7.9, (b)
restriction or encumbrance that the interest or title of such
lessor or sublessor may be subject to, or (c) subordination of
the interest of the lessee or sublessee under such lease to
any restriction or encumbrance referred to in the preceding
clause (b), so long as the holder of such restriction or
encumbrance agrees to recognize the rights of such lessee or
sublessee under such lease; and
(viii) Liens arising from filing UCC financing
statements relating solely to leases permitted by this
Agreement.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"Pledged Collateral" means, collectively, the "Pledged Shares" and the
"Pledged Debt" as such terms are defined in the Security Agreement.
"Pompeii Mexico" means Industrial Mueblera Pompeii de Mexico, S.A.
de C.V., a corporation organized
under the laws of Mexico.
"Potential Event of Default" means a condition or event that, after
notice or lapse of time or both, would constitute an Event of Default.
"Pro Rata Share" means (i) with respect to all payments, computations
and other matters relating to the Term Loan Commitment or the Term Loan of any
Lender, the percentage obtained by dividing (x) the Term Loan Exposure of that
Lender by (y) the aggregate Term Loan Exposure of all Lenders, (ii) with respect
to all payments, computations and other matters relating to the Revolving Loan
Commitment or the Revolving Loans of any Lender or any Letters of Credit issued
or participations therein purchased by any Lender, the percentage obtained by
dividing (x) the Revolving Loan Exposure of that Lender by (y) the aggregate
Revolving Loan Exposure of all Lenders, and (iii) for all other purposes with
respect to each Lender, the percentage obtained by dividing (x) the sum of the
Term Loan Exposure of that Lender plus the Revolving Loan Exposure of that
Lender by (y) the sum of the aggregate Term Loan Exposure of all Lenders plus
the aggregate Revolving Loan Exposure of all Lenders, in any such case as the
applicable percentage may be adjusted by assignments permitted pursuant to
subsection 10.1.
"PTO" means the United States Patent and Trademark Office or any
successor or substitute office in which filings are necessary or, in the opinion
of Administrative Agent, desirable in order to create or perfect Liens on any IP
Collateral.
"Real Property Asset" means, at any time of determination, any interest
then owned by any Loan Party in any real property.
"Recorded Leasehold Interest" means a Leasehold Property with respect
to which a Record Document (as hereinafter defined) has been recorded in all
places necessary or desirable, in Administrative Agent's reasonable judgment, to
give constructive notice of such Leasehold Property to third-party purchasers
and encumbrancers of the affected real property. For purposes of this
definition, the term "Record Document" means, with respect to any Leasehold
Property, (a) the lease evidencing such Leasehold Property or a memorandum
thereof, executed and acknowledged by the owner of the affected real property,
as lessor, or (b) if such Leasehold Property was acquired or subleased from the
holder of a Recorded Leasehold Interest, the applicable assignment or sublease
document, executed and acknowledged by such holder, in each case in form
sufficient to give such constructive notice upon recordation and otherwise in
form reasonably satisfactory to Administrative Agent.
"Reference Rate" means the rate that CIBC announces from time to time
as its prime lending rate, as in effect from time to time. The Reference Rate is
a reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. CIBC or any other Lender may make commercial
loans or other loans at rates of interest at, above or below the Reference Rate.
"Refinancing" has the meaning assigned to that term in the Recitals to
this Agreement.
"Refunded Swing Line Loans" has the meaning assigned to that term in
subsection 2.1A(iii).
"Register" has the meaning assigned to that term in subsection 2.1E.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of August 27, 1999 to which Borrower and the initial purchasers of the
Senior Subordinated Notes are parties.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Agreements" means, collectively, the Management Subscription
Agreement, the Trivest Management Agreement, the Senior Subordinated Note
Documents, the Employment Agreements, the Investors Agreement, the Holdings Note
Documents, the Holdings Option Agreement, the Merger Agreement, the Articles of
Merger and the Acquisition Agreement.
"Release" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"Requisite Class Lenders" means, at any time of determination (i) for
the Class of Lenders having Revolving Loan Exposure, Lenders having or holding
more than 50% of the aggregate Revolving Loan Exposure of all Lenders, and (ii)
for the Class of Lenders having Term Loan Exposure, Lenders having or holding
more than 50% of the aggregate Term Loan Exposure of all Lenders.
"Requisite Lenders" means Lenders having or holding more than 50% of
the sum of the Term Loan Exposure of all Lenders plus the aggregate Revolving
Loan Exposure of all Lenders.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of Borrower Common
Stock or any other class of stock of Borrower or any of its Subsidiaries now or
hereafter outstanding, except a dividend payable solely in shares of that class
of stock to the holders of that class, (ii) any redemption, retirement, sinking
fund or similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of Holdings Common Stock, Borrower Common Stock or any
other class of stock of Holdings, Borrower or any of their respective
Subsidiaries now or hereafter outstanding, (iii) any payment made to retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of Holdings Common Stock, Borrower Common Stock or any other
class of stock of Holdings, Borrower or any of their respective Subsidiaries now
or hereafter outstanding, and (iv) any payment or prepayment of principal of,
premium, if any, or interest on, or redemption, purchase, retirement, defeasance
(including in-substance or legal defeasance), sinking fund or similar payment
with respect to, any Subordinated Indebtedness permitted under this Agreement.
"Revolving Lenders" means the Lenders that have Revolving Loan
Commitments or a Swing Line Loan Commitment or that have Revolving Loans or
Swing Line Loans outstanding, together with their successors and permitted
assignees pursuant to subsection 10.1.
"Revolving Loan Commitment" means the commitment of a Lender to make
Revolving Loans to Borrower pursuant to subsection 2.1A(ii), and "Revolving Loan
Commitments" means such commitments of all Lenders in the aggregate. The
Revolving Loan Commitments shall be recorded by Administrative Agent in the
Register.
"Revolving Loan Commitment Termination Date" means March 31, 2006.
"Revolving Loan Exposure" means, with respect to any Lender, as of any
date of determination (i) prior to the termination of the Revolving Loan
Commitments, that Lender's Revolving Loan Commitment, and (ii) after the
termination of the Revolving Loan Commitments, the sum of (a) the aggregate
outstanding principal amount of the Revolving Loans of that Lender plus (b) in
the event that Lender is an Issuing Lender, the aggregate Letter of Credit Usage
in respect of all Letters of Credit issued by that Lender (in each case net of
any participations purchased by other Lenders in such Letters of Credit or in
any unreimbursed drawings thereunder) plus (c) the aggregate amount of all
participations purchased by that Lender in any outstanding Letters of Credit or
any unreimbursed drawings under any Letters of Credit plus (d) in the case of
Swing Line Lender, the aggregate outstanding principal amount of all Swing Line
Loans (net of any assignments thereof purchased by other Lenders) plus (e) the
aggregate amount of all assignments purchased by that Lender in any outstanding
Swing Line Loans.
"Revolving Loans" means the Loans made by Lenders to Borrower pursuant
to subsection 2.1A(ii).
"Revolving Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1D(i)(b) on the Closing Date (or any replacements
thereof), and (ii) any promissory notes issued by Borrower pursuant to the
penultimate sentence of subsection 10.1B(i) in connection with assignments
of the Revolving Loan Commitments and Revolving Loans of any Lenders, in
each case substantially in the form of Exhibit VI annexed hereto, as they
may be amended, supplemented or otherwise modified from time to time.
"Sales Terms" means as to any Person, the terms and conditions on which
Inventory is sold by such Person in the ordinary course of its business
(including the terms and conditions of any recurring seasonal or other
promotional sales programs and other sales terms regularly offered by such
Person to any of its customers), as set forth in such Person's sales manual or
otherwise in writing delivered to and accepted by the Administrative Agent prior
to the Closing Date or, if applicable, prior to the date on which such Person
becomes a Subsidiary Guarantor.
"S&P" means Standard & Poor's Ratings Group.
"Securities" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, and any successor statute.
"Security Agreement" means the Security Agreement executed and
delivered by each of the Loan Parties on the Closing Date, substantially in the
form of Exhibit XIII annexed hereto.
"Sellers" means the shareholders of BJI listed as Sellers on Schedule 1
to the Acquisition Agreement.
"Senior Subordinated Notes" means up to $105,000,000 aggregate
principal amount at maturity of 12 3/4% per annum unsecured Senior Subordinated
Notes due 2007 issued on or prior to the Closing Date pursuant to the
Subordinated Note Indenture and any Subordinated Notes due 2007 of Borrower
issued in exchange therefor which have been registered under the Securities Act
and otherwise have the identical terms as the initial Senior Subordinated Notes
due 2007.
"Senior Subordinated Note Documents" means the Senior Subordinated
Notes, the Subordinated Note Indenture and the Registration Rights Agreement.
"Share Contribution" has the meaning assigned to that term in the
Recitals to this Agreement.
"Solvent" means, with respect to any Person, that as of the date of
determination both (A) (i) the then fair saleable value of the property of such
Person is (y) greater than the total amount of liabilities (including contingent
liabilities) of such Person and (z) not less than the amount that will be
required to pay the probable liabilities on such Person's then existing debts as
they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (ii) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"Subordinated Indebtedness" means (a) the Indebtedness of Borrower
evidenced by the Senior Subordinated Notes, (b) the Indebtedness of Holdings
evidenced by the Holdings Notes, and (c) any other Indebtedness of Borrower or
Holdings subordinated in right of payment to the Obligations pursuant to
documentation containing maturities, amortization schedules, covenants,
defaults, remedies, subordination provisions and other material terms in form
and substance satisfactory to Administrative Agent.
"Subordinated Note Indenture" means the Indenture dated as of August
24, 1999 entered into by WinsLoew Escrow Corp., a Florida corporation, and
American Stock Transfer & Trust Company, as Trustee.
"Subscription and Shareholders' Agreement" means the Subscription and
Shareholders' Agreement to be entered into among Borrower, Xxxx Xxxxx (and any
other Seller who purchases any shares of Borrower Common Stock on or prior to
the Closing Date), and Trivest or its Affiliates, in the form of Exhibit B to
the Acquisition Agreement.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.
"Subsidiary Guarantor" means any domestic Subsidiary of Borrower that
executes and delivers a counterpart of the Subsidiary Guaranty on the Closing
Date or from time to time thereafter pursuant to subsection 6.8.
"Subsidiary Guaranty" means the Subsidiary Guaranty executed and
delivered by each of the existing domestic Subsidiaries of Borrower on the
Closing Date and to be executed and delivered by additional domestic
Subsidiaries of Borrower from time to time thereafter in accordance with
subsection 6.8, substantially in the form of Exhibit XIV annexed hereto, as such
Subsidiary Guaranty may hereafter be amended, supplemented or otherwise modified
from time to time.
"Supplemental Collateral Agent" has the meaning assigned to that term
in subsection 9.1B.
"Swing Line Lender" has the meaning assigned to that term in the
introduction to this Agreement and also means any successor Swing Line Lender
appointed pursuant to subsection 9.5B.
"Swing Line Loan Commitment" means the commitment of Swing Line Lender
to make Swing Line Loans to Borrower pursuant to subsection 2.1A(iii).
"Swing Line Loans" means the Loans made by Swing Line Lender to
Borrower pursuant to subsection 2.1A(iii).
"Swing Line Note" means (i) the promissory note of Borrower issued
pursuant to subsection 2.1D on the Closing Date (or any replacements thereof)
and (ii) any promissory note issued by Borrower to any successor Swing Line
Lender pursuant to the last sentence of subsection 9.5B, in each case
substantially in the form of Exhibit VII annexed hereto, as it may be amended,
supplemented or otherwise modified from time to time.
"Tax" or "Taxes" means any present or future tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature and whatever called, by
whomsoever, on whomsoever and wherever imposed, levied, collected, withheld or
assessed, including interest, penalties, additions to tax and any similar
liabilities with respect thereto; except that, in the case of a Lender, there
shall be excluded (1) taxes that are imposed on the overall net income or net
profits (including franchise taxes imposed in lieu thereof) (i) by the United
States, (ii) by any other government authority under the laws of which the
Lender is organized or has its principal office or maintains its applicable
lending office, or (iii) by any jurisdiction solely as a result of a present or
former connection between the Lender (other than any such connection arising
solely from the Lender having executed, delivered or performed its obligations
or received a payment under, or enforced any of the Loan Documents), and (2) any
branch profits taxes imposed by the United States or any similar tax imposed by
any other jurisdiction in which the Lender is located.
"Term Loan Commitment" means the commitment of a Lender to make a Term
Loan to Borrower pursuant to subsection 2.1A(i), and "Term Loan Commitments"
means such commitments of all Lenders in the aggregate. The Term Loan
Commitments shall be recorded by Administrative Agent in the Register.
"Term Loan Exposure" means, with respect to any Lender as of any date
of determination (i) prior to the funding of the Term Loans, that Lender's Term
Loan Commitment and (ii) after the funding of the Term Loans, the outstanding
principal amount of the Term Loan of that Lender.
"Term Loan Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1D(i)(a) on the Closing Date (or any replacements
thereof), and (ii) any promissory notes issued by Borrower pursuant to the
penultimate sentence of subsection 10.1B(i) in connection with assignments of
the Term Loan Commitments or Term Loans of any Lenders, in each case
substantially in the form of Exhibit V annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.
"Term Loans" means the Loans made by Lenders to Borrower pursuant to
subsection 2.1A(i).
"Title Company" means Commonwealth Land Title Company.
"Total Utilization of Revolving Loan Commitments" means, as at any date
of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans (other than Revolving Loans made for the purpose of
reimbursing the applicable Issuing Lender for any amount drawn under any Letter
of Credit but not yet so applied) plus (ii) the aggregate principal amount of
all outstanding Swing Line Loans plus (iii) the Letter of Credit Usage.
"Transaction Costs" means the fees, costs and expenses payable by
Borrower on or before the Closing Date in connection with the transactions
contemplated by the Loan Documents and the Related Agreements.
"Trivest" has the meaning assigned to that term in the Recitals to this
Agreement.
"Trivest Partners, L.P." means Trivest Partners, L.P., a Florida
limited partnership, or its successors.
"Trivest Management Agreement" means that certain Management Agreement,
dated as of August 27, 1999, by and between Trivest Partners and Borrower, as
amended by that certain Amendment to Management Agreement dated as of the
Closing Date by and between Trivest Partners and Borrower, all in the form
delivered to Administrative Agent and Lenders prior to their execution of this
Agreement.
"Type" means, with respect to any Loan, a Term Loan, a Revolving Loan
or a Swing Line Loan (each of which is a "Type" of Loan).
"UCC" means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.
1.2 Accounting Terms; Utilization of GAAP for
Purposes of Calculations Under Agreement.
-----------------------------------------
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Borrower to Lenders pursuant to clauses (i), (ii),
(iii) and (xi) of subsection 6.1 shall be prepared in accordance with GAAP as in
effect in the United States of America at the time of such preparation (and
delivered together with the reconciliation statements provided for in subsection
6.1(v)). Calculations in connection with the definitions, covenants and other
provisions of this Agreement shall utilize GAAP as in effect in the United
States of America on the date of determination, applied in a manner consistent
with that used in preparing the financial statements referred to in subsection
5.3. If at any time any change in such GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and Borrower,
Administrative Agent or Requisite Lenders shall so request, Administrative
Agent, Lenders and Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
such GAAP (subject to the approval of Requisite Lenders), provided that, until
so amended, such ratio or requirement shall continue to be computed in
accordance with such GAAP prior to such change therein and Borrower shall
provide to Administrative Agent and Lenders reconciliation statements provided
for in subsection 6.1(v).
1.3 Other Definitional Provisions and Rules of Construction.
A. Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the
reference.
B. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise
specifically provided.
C. The use in any of the Loan Documents of the word "include" or "including",
when following any general statement, term or matter, shall not be construed to
limit such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
nonlimiting language (such as "without limitation" or "but not limited to" or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.
D. Each of the parties hereto acknowledges that (i) it has been represented by
counsel in the negotiation and documentation of the terms of this Agreement,
(ii) it has had full and fair opportunity to review and revise the terms of this
Agreement, (iii) this Agreement has been drafted jointly by all of the parties
hereto, and (iv) neither Administrative Agent nor any Lender has any fiduciary
relationship with or duty to Borrower arising out of or in connection with this
Agreement or any of the other Loan Documents, and the relationship between
Administrative Agent and Lenders, on one hand, and Borrower, on the other hand,
in connection herewith or therewith is solely that of debtor and creditor.
Accordingly, each of the parties hereto acknowledges and agrees that the terms
of this Agreement shall not be construed against or in favor of another party.
E. (i) Any reference in this Agreement or any other Loan Document to any
agreement means such agreement as it may be amended, restated, supplemented or
otherwise modified from time to time; (ii) any reference in this Agreement or
any other Loan Document to any law, statute, regulation, rule or other
legislative action shall mean such law, statute, regulation, rule or other
legislative action as amended, supplemented or otherwise modified from time to
time, and shall include any rule or regulation promulgated thereunder; and (iii)
any reference in this Agreement or any other Loan Document to a Person shall
include the successor or assignee of such Person.
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; Optional Notes.
A. Commitments. Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties of Borrower herein set forth,
each Lender hereby severally agrees to make the Loans described in subsections
2.1A(i) and 2.1A(ii), and Swing Line Lender hereby agrees to make the Swing Line
Loans described in subsection 2.1A(iii):
(i) Term Loans. Borrower shall deliver to Administrative Agent a Notice of
Borrowing no later than ---------- 12:00 Noon (New York City time) at least one
Business Day prior to the Closing Date, requesting a borrowing of the Term
Loans. The Notice of Borrowing shall specify (i) the proposed Funding Date
(which shall be a Business Day), and (ii) that such Loans shall be Base Rate
Loans. Each Lender severally agrees to lend to Borrower on the Closing Date an
amount not exceeding its Pro Rata Share of the aggregate amount of the Term Loan
Commitments to be used for the purposes identified in subsection 2.5A. The
aggregate amount of the Term Loan Commitments is $165,000,000. Each Lender's
Term Loan Commitment shall expire immediately and without further action on May
15, 2001 if the Term Loans are not made on or before that date. Borrower may
make only one borrowing under the Term Loan Commitments. Amounts borrowed under
this subsection 2.1A(i) and subsequently repaid or prepaid may not be
reborrowed.
(ii) Revolving Loans. Each Lender severally agrees, subject to the limitations
set forth below with --------------- respect to the maximum amount of Revolving
Loans permitted to be outstanding from time to time, to lend to Borrower from
time to time during the period from the Closing Date to but excluding the
Revolving Loan Commitment Termination Date an aggregate amount not exceeding its
Pro Rata Share of the aggregate amount of the Revolving Loan Commitments to be
used for the purposes identified in subsection 2.5B. The aggregate original
amount of the Revolving Loan Commitments is $60,000,000; provided that (1) the
Revolving Loan Commitments of Revolving Lenders shall be adjusted to give
-------- effect to any increase in Revolving Loan Commitments pursuant to
subsection 2.1A(iv), and (2) the amount of the Revolving Loan Commitments shall
be reduced from time to time by the amount of any reductions thereto made
pursuant to subsection 2.4B. Each Lender's Revolving Loan Commitment shall
expire on the Revolving Loan Commitment Termination Date and all Revolving Loans
and all other amounts owed hereunder with respect to the Revolving Loans and the
Revolving Loan Commitments shall be paid in full no later than that date;
provided that each Lender's Revolving Loan Commitment shall -------- expire
immediately and without further action on May 15, 2001 if the Term Loans and the
initial Revolving Loans are not made on or before that date. Amounts borrowed
under this subsection 2.1A(ii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary notwithstanding, the
Revolving Loans and the Revolving Loan Commitments shall be subject to the
limitation that in no event shall the Total Utilization of Revolving Loan
Commitments at any time exceed the lesser of the Revolving Loan Commitments then
in effect and the Borrowing Base then in effect.
(iii) Swing Line Loans. Swing Line Lender hereby agrees, subject to the
limitations set forth below with ---------------- respect to the maximum amount
of Swing Line Loans permitted to be outstanding from time to time, to make a
portion of the Revolving Loan Commitments available to Borrower from time to
time during the period from the Closing Date to but excluding the Revolving Loan
Commitment Termination Date by making Swing Line Loans to Borrower in an
aggregate amount not exceeding the amount of the Swing Line Loan Commitment to
be used for the purposes identified in subsection 2.5B, notwithstanding the fact
that such Swing Line Loans, when aggregated with Swing Line Lender's outstanding
Revolving Loans and Swing Line Lender's Pro Rata Share of the Letter of Credit
Usage then in effect, may exceed Swing Line Lender's Revolving Loan Commitment.
The original amount of the Swing Line Loan Commitment is $5,000,000; provided
that any reduction of the Revolving Loan Commitments made -------- pursuant to
subsection 2.4B(ii) or 2.4B(iii) which reduces the aggregate Revolving Loan
Commitments to an amount less than the then current amount of the Swing Line
Loan Commitment shall result in an automatic corresponding reduction of the
Swing Line Loan Commitment to the amount of the Revolving Loan Commitments, as
so reduced, without any further action on the part of Borrower, Administrative
Agent or Swing Line Lender. The Swing Line Loan Commitment shall expire on the
Revolving Loan Commitment Termination Date and all Swing Line Loans and all
other amounts owed hereunder with respect to the Swing Line Loans shall be paid
in full no later than that date; provided that the -------- Swing Line Loan
Commitment shall expire immediately and without further action on May 15, 2001
if the Term Loans are not made on or before that date. Amounts borrowed under
this subsection 2.1A(ii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary notwithstanding, the Swing
Line Loans and the Swing Line Loan Commitment shall be subject to the limitation
that in no event shall the Total Utilization of Revolving Loan Commitments at
any time exceed the lesser of the Revolving Loan Commitments then in effect and
the Borrowing Base then in effect.
With respect to any Swing Line Loans that have not been voluntarily prepaid by
Borrower pursuant to subsection 2.4B(i), Swing Line Lender may, at any time in
its sole and absolute discretion, deliver to Administrative Agent (with a copy
to Borrower), no later than 12:00 Noon (New York City time) at least one
Business Day in advance of the proposed Funding Date, a notice (which shall be
deemed to be a Notice of Borrowing given by Borrower) requesting Lenders to make
Revolving Loans that are Base Rate Loans on such Funding Date in an amount equal
to the amount of such Swing Line Loans (the "Refunded Swing Line Loans")
outstanding on the date such notice is given. Borrower hereby authorizes the
giving of any such notice and the making of any such Revolving Loans. Anything
contained in this Agreement to the contrary notwithstanding, (i) the proceeds of
such Revolving Loans made by Lenders other than Swing Line Lender shall be
immediately delivered by Administrative Agent to Swing Line Lender (and not to
Borrower) and applied to repay a corresponding portion of the Refunded Swing
Line Loans and (ii) on the day such Revolving Loans are made, Swing Line
Lender's Pro Rata Share of the Refunded Swing Line Loans shall be deemed to be
paid with the proceeds of a Revolving Loan made by Swing Line Lender, and such
portion of the Swing Line Loans deemed to be so paid shall no longer be
outstanding as Swing Line Loans and shall no longer be due under the Swing Line
Note of Swing Line Lender but shall instead constitute part of Swing Line
Lender's outstanding Revolving Loans and shall be due under the Revolving Note
of Swing Line Lender. Borrower agrees to immediately pay Swing Line Lender the
amount of the Refunded Swing Line Loans to the extent the proceeds of such
Revolving Loans made by Lenders, including the Revolving Loan deemed to be made
by Swing Line Lender, are not sufficient to repay in full the Refunded Swing
Line Loans. If any portion of any such amount paid (or deemed to be paid) to
Swing Line Lender should be recovered by or on behalf of Borrower from Swing
Line Lender in bankruptcy, by assignment for the benefit of creditors or
otherwise, the loss of the amount so recovered shall be ratably shared among all
Lenders in the manner contemplated by subsection 10.5.
If for any reason (a) Revolving Loans are not made upon the request of Swing
Line Lender as provided in the immediately preceding paragraph in an amount
sufficient to repay any amounts owed to Swing Line Lender in respect of any
outstanding Swing Line Loans or (b) the Revolving Loan Commitments are
terminated at a time when any Swing Line Loans are outstanding, each Lender
shall be deemed to, and hereby agrees to, have purchased an assignment of such
outstanding Swing Line Loans in an amount equal to its Pro Rata Share
(calculated, in the case of the foregoing clause (b), immediately prior to such
termination of the Revolving Loan Commitments) of the unpaid amount of such
Swing Line Loans together with accrued interest thereon. Upon one Business Day's
notice from Swing Line Lender, each Lender shall deliver to Swing Line Lender an
amount equal to its respective assignment in same day funds at the
Administrative Agent's Office. In order to further evidence such assignment (and
without prejudice to the effectiveness of the assignment provisions set forth
above), each Lender agrees to enter into an Assignment Agreement at the request
of Swing Line Lender in form and substance reasonably satisfactory to the Swing
Line Lender and such Lender. If any Lender fails to make available to Swing Line
Lender the amount of such Lender's assignment as provided in this paragraph,
Swing Line Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon at the rate customarily used by Swing Line
Lender for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If Swing Line Lender receives a payment of any
amount in which other Lenders have purchased assignments as provided in this
paragraph, Swing Line Lender shall promptly distribute to each such other Lender
its Pro Rata Share of such payment.
Anything contained herein to the contrary notwithstanding, each Lender's
obligation to make Revolving Loans for the purpose of repaying any Refunded
Swing Line Loans pursuant to the second preceding paragraph and each Lender's
obligation to purchase an assignment of any unpaid Swing Line Loans pursuant to
the immediately preceding paragraph shall be absolute and unconditional and
shall not be affected by any circumstance, including (a) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against Swing Line Lender, Borrower or any other Person for any reason
whatsoever; (b) the occurrence or continuation of an Event of Default or a
Potential Event of Default; (c) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of Borrower
or any of its Subsidiaries; (d) any breach of this Agreement or any other Loan
Document by any party thereto; or (e) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing; provided that such
obligations of each Lender are subject to the condition that (x) Swing Line
Lender believed in good faith that all conditions under Section 4 to the making
of the applicable Refunded Swing Line Loans or other unpaid Swing Line Loans, as
the case may be, were satisfied at the time such Refunded Swing Line Loans or
unpaid Swing Line Loans were made or (y) the satisfaction of any such condition
not satisfied had been waived in accordance with subsection 10.6 prior to or at
the time such Refunded Swing Line Loans or other unpaid Swing Line Loans were
made.
(iv) Increases of the Revolving Loan Commitments. At the mutual discretion of
Borrower and Lead ------------------------------------------- Arranger, Borrower
may request in writing at any time during the period from the Closing Date
through March 31, 2005 that the then effective aggregate principal amount of
Revolving Loan Commitments be increased; provided that (1) the aggregate
principal amount of the increase in -------- Revolving Loan Commitments pursuant
to this subsection 2.1A(iv) shall not exceed $10,000,000, (2) Borrower may not
make more than one request for such increase in Revolving Loan Commitments, (3)
no Event of Default or Potential Event of Default shall have occurred and be
continuing or occurs as a result of such increase in Revolving Loan Commitments,
and (4) Borrower shall, and shall cause its Subsidiaries to, execute and deliver
such documents and instruments and take such other actions (including obtaining
appropriate endorsements to title insurance policies) as may be reasonably
requested by Administrative Agent in connection with such increase. Any request
under this subsection 2.1A(iv) shall be submitted by Borrower to Administrative
Agent (which shall promptly forward copies to the Revolving Lenders by
telefacsimile or electronic mail), specify the proposed effective date and
amount of such increase and be accompanied by an Officers' Certificate stating
that no Event of Default or Potential Event of Default exists or will occur as a
result of such increase. Borrower may also specify any fees offered to those
Revolving Lenders (the "Increasing Lenders") which agree to increase the
principal amount of their applicable Revolving Loan Commitments, which fees may
be variable based upon the amount by which any such Revolving Lender is willing
to increase the principal amount of its applicable Revolving Loan Commitment. No
Revolving Lender shall have any obligation, express or implied, to offer to
increase the aggregate principal amount of its Revolving Loan Commitment. Only
the consent of each Increasing Lender shall be required for an increase in the
aggregate principal amount of the Revolving Loan Commitments pursuant to this
subsection 2.1A(iv). No Lender which elects not to increase the principal amount
of its Revolving Loan Commitment may be replaced in respect of its existing
Revolving Loan Commitment, and no such Lender's existing Revolving Loan
Commitment shall be reduced, as a result thereof without such Revolving Lender's
consent.
Each Increasing Lender shall as soon as practicable
specify the amount of the proposed increase which it is willing to
assume. Borrower may accept some or all of the offered amounts or
designate new lenders who qualify as Eligible Assignees and which are
reasonably acceptable to Administrative Agent as additional Lenders
hereunder in accordance with this subsection 2.1A(iv) (each such new
lender being a "New Lender"), which New Lender may assume all or a
portion of the increase in the aggregate principal amount of the
Revolving Loan Commitments. Borrower and Administrative Agent shall
have discretion jointly to adjust the allocation of the increased
aggregate principal amount of the Revolving Loan Commitments among
Increasing Lenders and New Lenders.
Each New Lender designated by Borrower and reasonably
acceptable to Administrative Agent shall become an additional party
hereto as a New Lender concurrently with the effectiveness of the
proposed increase in the aggregate principal amount of the Revolving
Loan Commitments upon its execution of an instrument of joinder (which
may contain such modifications to this Agreement and terms and
conditions relating thereto as may be necessary to ensure that such
Revolving Loan Commitments are treated as Revolving Loan Commitments
for all purposes hereunder), in each case in form and substance
reasonably satisfactory to Administrative Agent.
Subject to the foregoing, any increase requested by
Borrower shall be effective as of the date proposed by Borrower and
shall be in the principal amount equal to (i) the principal amount
which Increasing Lenders are willing to assume as increases to the
principal amount of their Revolving Loan Commitments, plus (ii) the
principal amount offered by New Lenders with respect to the Revolving
Loan Commitments, as adjusted by Borrower and Administrative Agent
pursuant to this subsection 2.1A(iv). Upon effectiveness of any such
increase, the Pro Rata Share of each Revolving Lender will be adjusted
to give effect to the increase in the Revolving Loan Commitments and
Administrative Agent shall notify each Revolving Lender of its revised
Revolving Loan Commitment and Pro Rata Share after giving effect to
such increase. To the extent that the adjustment of Pro Rata Shares for
the Revolving Lenders results in losses or expenses to any Revolving
Lender as a result of the prepayment of any LIBOR Loan on a date other
than the scheduled last day of the applicable Interest Period, Borrower
shall be responsible for such losses or expenses pursuant to subsection
2.6D.
B. Borrowing Mechanics. Except for Revolving Loans made on the Closing Date,
Revolving Loans made on any Funding Date (other than Revolving Loans made
pursuant to a request by Swing Line Lender pursuant to subsection 2.1A(iii) for
the purpose of repaying any Refunded Swing Line Loans or Revolving Loans made
pursuant to subsection 3.3B for the purpose of reimbursing any Issuing Lender
for the amount of a drawing under a Letter of Credit issued by it) shall be in
an aggregate minimum amount of $150,000 and integral multiples of $50,000 in
excess of that amount; provided that Revolving Loans made on any Funding Date as
LIBOR Loans with a particular Interest Period shall be in an aggregate minimum
amount of $1,000,000 and integral multiples of $100,000 in excess of that
amount. Any Swing Line Loan made on any Funding Date shall be in a minimum
amount of $100,000 and integral multiples of $50,000 in excess of that amount.
Whenever Borrower desires that Lenders make Revolving Loans it shall deliver a
Notice of Borrowing to Administrative Agent no later than 11:00 A.M. (New York
City time) at least three Business Days in advance of the proposed Funding Date
(in the case of a LIBOR Loan) or at least one Business Day in advance of the
proposed Funding Date (in the case of a Base Rate Loan). Whenever Borrower
desires that Swing Line Lender make a Swing Line Loan, it shall deliver a Notice
of Borrowing to Administrative Agent no later than 1:00 P.M. (New York City
time) on the proposed Funding Date. The Notice of Borrowing shall specify (i)
the proposed Funding Date (which shall be a Business Day), (ii) the amount and
Type of Loans requested, (iii) in the case of Swing Line Loans and any Loans
made on the Closing Date, that such Loans shall be Base Rate Loans, (iv) in the
case of Revolving Loans not made on the Closing Date, whether such Loans shall
be Base Rate Loans or LIBOR Loans, (v) in the case of any Loans requested to be
made as LIBOR Loans, the initial Interest Period requested therefore, and (vi)
information about the account of Borrower to be credited. Revolving Loans may be
continued as or converted into Base Rate Loans and LIBOR Loans in the manner
provided in subsection 2.2D. In lieu of delivering the above-described Notice of
Borrowing, Borrower may give Administrative Agent telephonic notice by the
required time of any proposed borrowing under this subsection 2.1B; provided
that such notice shall be promptly confirmed in writing by delivery of a Notice
of Borrowing to Administrative Agent on the date such notice was given.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Revolving Loans by Lenders in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected Revolving Loans hereunder.
Borrower shall notify Administrative Agent prior to the funding of any
Revolving Loans in the event that any of the matters to which Borrower is
required to certify in the applicable Notice of Borrowing is no longer true and
correct as of the applicable Funding Date, and the acceptance by Borrower of the
proceeds of any Revolving Loans shall constitute a re-certification by Borrower,
as of the applicable Funding Date, as to the matters to which Borrower is
required to certify in the applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Borrowing for a LIBOR Loan (or telephonic notice in lieu thereof)
shall be irrevocable once Administrative Agent receives such notice, and
Borrower shall be bound to make a borrowing in accordance therewith.
C. Disbursement of Funds. All Term Loans and Revolving Loans under this
Agreement shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that neither Administrative
Agent nor any Lender shall be responsible for any default by any other Lender in
that other Lender's obligation to make a Loan requested hereunder nor shall the
Commitment of any Lender to make the particular Type of Loan requested be
increased or decreased as a result of a default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder. Promptly after
receipt by Administrative Agent of a Notice of Borrowing pursuant to subsection
2.1A or subsection 2.1B (or telephonic notice in lieu thereof), Administrative
Agent shall notify each Lender of the proposed borrowing by telefacsimile or
electronic mail or by telephone promptly confirmed by telefacsimile or
electronic mail. Each Lender shall make the amount of its Loan available to
Administrative Agent not later than 2:00 P.M. (New York City time) on the
applicable Funding Date, and Swing Line Lender shall make the amount of its
Swing Line Loan available to Borrower not later than 6:00 P.M. (New York City
time) on the applicable Funding Date, in each case in same day funds in Dollars,
at the Administrative Agent's Office. Except as provided in subsection 2.1A(iii)
or subsection 3.3B with respect to Revolving Loans used to repay Refunded Swing
Line Loans or to reimburse any Issuing Lender for the amount of a drawing under
a Letter of Credit issued by it, upon satisfaction or waiver of the conditions
precedent specified in subsections 4.1 (in the case of Loans made on the Closing
Date) and 4.2 (in the case of all Loans), Administrative Agent shall make the
proceeds of such Loans available to Borrower on the applicable Funding Date by
causing an amount of same day funds in Dollars equal to the proceeds of all such
Loans received by Administrative Agent from Lenders or Swing Line Lender, as the
case may be, to be credited to an account of Borrower as specified in the
applicable Notice of Borrowing.
Unless Administrative Agent shall have been notified by any Lender
prior to the Funding Date for any Loans that such Lender does not intend to make
available to Administrative Agent the amount of such Lender's Loan requested on
such Funding Date, Administrative Agent may assume that such Lender has made
such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Borrower a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon,
for each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the customary rate set by Administrative Agent for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. If such Lender does not pay such corresponding amount forthwith upon
Administrative Agent's demand therefor, Administrative Agent shall promptly
notify Borrower and Borrower shall immediately pay such corresponding amount to
Administrative Agent together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Administrative Agent, at the
rate payable under this Agreement for Base Rate Loans. Nothing in this
subsection 2.1C shall be deemed to relieve any Lender from its obligation to
fulfill its Commitments hereunder or to prejudice any rights that Borrower may
have against any Lender as a result of any default by such Lender hereunder.
D. Notes. Borrower shall execute and deliver on the Closing Date (i) to each
Lender (a) a Term Loan Note substantially in the form of Exhibit V annexed
hereto to evidence that Lender's Term Loan, in the principal amount of that
Lender's Term Loan and with other appropriate insertions, and (b) a Revolving
Note substantially in the form of Exhibit VI annexed hereto to evidence that
Lender's Revolving Loans, in the principal amount of that Lender's Revolving
Loan Commitment and with other appropriate insertions, and (ii) to Swing Line
Lender (or to Administrative Agent for Swing Line Lender) a Swing Line Note
substantially in the form of Exhibit VII annexed hereto to evidence Swing Line
Lender's Swing Line Loans, in the principal amount of the Swing Line Loan
Commitment and with other appropriate insertions.
Administrative Agent may deem and treat the payee of any Note as the
owner thereof for all purposes hereof unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent as provided in subsection 10.1B(ii). Any request,
authorization or consent of any Person who, at the time of making such request
or giving such authority or consent, is the holder of any Note shall be
conclusive and binding on any subsequent holder, assignee or transferee of that
Note or of any Note or Notes issued in exchange therefor.
If Borrower increases the aggregate principal amount of the Revolving
Loan Commitments pursuant to subsection 2.1A(iv), Borrower shall issue (a)
replacement Revolving Notes to each Increasing Lender, and (b) new Revolving
Notes to each New Lender (or to Administrative Agent for such New Lender).
E. The Register.
(i) Administrative Agent shall maintain, at its address referred to in
subsection 10.8, a copy of each Assignment Agreement delivered to it from time
to time in accordance with the provisions of subsection 10.1B and a register for
the recordation of the names and addresses of Lenders and the Commitments and
Loans of each Lender from time to time (the "Register"). The Register shall be
available for inspection by Borrower at any reasonable time and from time to
time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the Term Loan Commitment
and Revolving Loan Commitment and the Term Loans and Revolving Loans from time
to time of each Lender, the Swing Line Loan Commitment and the Swing Line Loans
from time to time of Swing Line Lender, and each repayment or prepayment in
respect of the principal amount of the Term Loan or Revolving Loans of each
Lender or the Swing Line Loans of Swing Line Lender. Any such recordation shall
be conclusive and binding on Borrower and each Lender, absent manifest error;
provided that failure to make any such -------- recordation, or any error in
such recordation, shall not affect any Lender's Commitments or Borrower's
Obligations in respect of any applicable Loans.
(iii) Each Lender may record on its internal records (including the Notes held
by such Lender) the amount of the Term Loans and each Revolving Loan made by it
and each payment in respect thereof. Any such recordation shall be conclusive
and binding on Borrower, absent manifest error; provided that failure to make
any such recordation, or any error in such recordation, shall not affect any
Lender's Commitments or Borrower's Obligations in respect of any applicable
Loans; and provided further that in the event of any inconsistency between the
Register and any Lender's records, the recordations in the Register shall govern
(absent manifest error).
(iv) Borrower, Administrative Agent and Lenders shall deem and treat the Persons
listed as Lenders in the Register as the holders and owners of the corresponding
Commitments and Loans listed therein for all purposes hereof, and no assignment
or transfer of any such Commitment or Loan shall be effective, in each case
unless and until an Assignment Agreement effecting the assignment or transfer
thereof shall have been accepted by Administrative Agent and recorded in the
Register as provided in subsection 10.1B(ii). Prior to such recordation, all
amounts owed with respect to the applicable Commitment or Loan shall be owed to
the Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee of the
corresponding Commitments or Loans.
(v) Borrower hereby designates CIBC to serve as Borrower's agent solely for
purposes of maintaining the Register as provided in this subsection 2.1E, and
Borrower hereby agrees that, to the extent CIBC serves in such capacity, CIBC
and its officers, directors, employees, agents and Affiliates shall constitute
Indemnitees for all purposes under subsection 10.3.
2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections 2.6 and 2.7, each
Term Loan and each Revolving Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) at a rate determined by reference to the Base Rate or the Adjusted
LIBOR. Subject to the provisions of subsection 2.7, each Swing Line Loan shall
bear interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to the Base Rate. The applicable basis for determining the rate of
interest with respect to any Term Loan or any Revolving Loan shall be selected
by Borrower initially at the time a Notice of Borrowing is given with respect to
such Loan pursuant to subsection 2.1B, and the basis for determining the
interest rate with respect to any Term Loan or any Revolving Loan may be changed
from time to time pursuant to subsection 2.2D. If on any day a Term Loan or
Revolving Loan is outstanding with respect to which notice has not been
delivered to Administrative Agent in accordance with the terms of this Agreement
specifying the applicable basis for determining the rate of interest, then for
that day that Loan shall bear interest determined by reference to the Base Rate.
Subject to the provisions of subsections 2.2E and 2.7, the Term Loans
and the Revolving Loans shall bear interest through maturity as follows:
(i) if a Base Rate Loan, then at the sum of the Base Rate plus the
Applicable Base Rate Margin for such
class of Loans; or
(ii) if a LIBOR Loan, then at the sum of the Adjusted LIBOR plus the
Applicable LIBOR Margin for such class of Loans.
Subject to the provisions of subsections 2.2E and 2.7, the Swing Line
Loans shall bear interest through maturity at the sum of the Base Rate plus the
Applicable Base Rate Margin.
Upon delivery of the Margin Determination Certificate by Borrower to
Administrative Agent pursuant to subsection 6.1(xvi), the Applicable Base Rate
Margin and Applicable LIBOR Margin shall automatically be adjusted in accordance
with such Margin Determination Certificate, such adjustment to become effective
on the fifth Business Day after such Margin Determination Certificate is
delivered to Administrative Agent; provided that (1) at any time a Margin
Determination Certificate is not delivered at the time required pursuant to
subsection 6.1(xvi), from the time such Margin Determination Certificate was
required to be delivered until delivery of such Margin Determination
Certificate, the Applicable Base Rate Margin shall be 2.50% for the Revolving
Loans, and the Applicable LIBOR Margin shall be 3.50% for the Revolving Loans,
and (2) if a Margin Determination Certificate erroneously indicates an
applicable margin more favorable to Borrower than should be afforded by the
actual calculation of the Consolidated Total Leverage Ratio, Borrower shall
promptly pay additional interest and letter of credit fees to correct for such
error.
B. Interest Periods. In connection with each LIBOR Loan, Borrower may, pursuant
to the applicable Notice of Borrowing or Notice of Conversion/Continuation, as
the case may be, select an interest period (each an "Interest Period") to be
applicable to such Loan, which Interest Period shall be, at Borrower's option,
either a one, two, three or six month period; provided that:
(i) the initial Interest Period for any LIBOR Loan shall commence on the
Funding Date in respect of such Loan, in the case of a Loan initially
made as a LIBOR Loan, or on the date specified in the applicable Notice
of Conversion/Continuation, in the case of a Loan converted to a LIBOR
Loan;
(ii) in the case of immediately successive Interest Periods applicable to a
LIBOR Loan continued as such pursuant to a Notice of
Conversion/Continuation, each successive Interest Period shall commence
on the day on which the next preceding Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day that is not a
Business Day, such Interest Period shall expire on the next succeeding
Business Day; provided that, if any Interest Period would otherwise
expire on a day that 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) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall,
subject to clause (v) of this subsection 2.2B, end on the last Business
Day of a calendar month;
(v) no Interest Period with respect to any portion of the Term Loans shall
extend beyond March 31, 2006 and no Interest Period with respect to any
portion of the Revolving Loans shall extend beyond the Revolving Loan
Commitment Termination Date;
(vi) no Interest Period with respect to any portion of the Term Loans shall
extend beyond a date on which Borrower is required to make a scheduled
payment of principal of Term Loans unless the sum of (a) the aggregate
principal amount of Term Loans that are Base Rate Loans plus (b) the
aggregate principal amount of Term Loans that are LIBOR Loans with
Interest Periods expiring on or before such date equals or exceeds the
principal amount required to be paid on the Term Loans on such date;
(vii) no Interest Period with respect to any portion of the Revolving Loans
shall extend beyond the date on which a permanent reduction of the
Revolving Loan Commitments is scheduled to occur unless the sum of (a)
the aggregate principal amount of Revolving Loans that are Base Rate
Loans plus (b) the aggregate principal amount of Revolving Loans that
are LIBOR Loans with Interest Periods expiring on or before such date
plus (c) the excess of the Revolving Loan Commitments then in effect
over the aggregate principal amount of Revolving Loans then outstanding
equals or exceeds the permanent reduction of the Revolving Loan
Commitments that is scheduled to occur on such date;
(viii) there shall be no more than twelve Interest Periods outstanding
at any time; and
(ix) in the event Borrower fails to specify an Interest Period for any LIBOR
Loan in the applicable Notice of Borrowing or Notice of
Conversion/Continuation, Borrower shall be deemed to have selected an
Interest Period of one month.
C. Interest Payments. Subject to the provisions of subsection 2.2E, interest on
each Loan shall be payable in arrears on and to each Interest Payment Date
applicable to that Loan, upon any prepayment of that Loan (to the extent accrued
on the amount being prepaid) and at maturity (including final maturity);
provided that in the event any Loans that are Base Rate Loans are prepaid
pursuant to subsection 2.4B(i), interest accrued on such Loans through the date
of such prepayment shall be payable on the next succeeding Interest Payment Date
applicable to Base Rate Loans (or, if earlier, at final maturity).
D. Conversion or Continuation. Subject to the provisions of subsection 2.6,
Borrower shall have the option (i) to convert at any time all or any part of its
outstanding Term Loans or Revolving Loans from Loans bearing interest at a rate
determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis, in each case in a Minimum
Amount therefor, or (ii) upon the expiration of any Interest Period applicable
to a LIBOR Loan, to continue all or any portion of such Loan equal to $1,000,000
and integral multiples of $100,000 in excess of that amount as a LIBOR Loan;
provided, however, that a LIBOR Loan may only be converted into a Base Rate Loan
on the expiration date of an Interest Period applicable thereto.
Borrower shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 12:00 Noon (New York City time) at least
three Business Days in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a LIBOR Loan). With respect to any LIBOR Loan, if Borrower
fails to deliver a Notice of Conversion/Continuation as described above or if
any proposed conversion/continuation under this subsection 2.2D is not permitted
hereunder, Borrower shall be deemed to have elected to convert such LIBOR Loan
to a Base Rate Loan on the last day of the then-expiring Interest Period.
A Notice of Conversion/Continuation shall specify (i) the proposed
conversion/continuation date (which shall be a Business Day), (ii) the amount
and Type of the Loan to be converted/continued, (iii) the nature of the proposed
conversion/continuation, (iv) in the case of a conversion to, or a continuation
of, a LIBOR Loan, the requested Interest Period, and (v) in the case of a
conversion to, or a continuation of, a LIBOR Loan, that no Potential Event of
Default or Event of Default has occurred and is continuing. In lieu of
delivering the above-described Notice of Conversion/Continuation, Borrower may
give Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D, provided that Administrative
Agent shall receive a Notice of Conversion/Continuation to confirm such
telephonic notice no later than 2:00 P.M. (New York City time) on the day on
which such telephonic notice is given. Upon receipt of written or telephonic
notice of any proposed conversion/continuation under this subsection 2.2D,
Administrative Agent shall promptly transmit such notice by telefacsimile or
electronic mail (or by telephone promptly confirmed by telefacsimile or
electronic mail) to each Lender.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.2D, and upon
conversion or continuation of the applicable basis for determining the interest
rate with respect to any Loans in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected a conversion or
continuation, as the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
notice of a proposed conversion to, or continuation of, a LIBOR Loan (whether by
delivery of a Notice of Conversion/Continuation or telephonic notice) shall be
irrevocable once Administrative Agent receives such notice, and Borrower shall
be bound to effect a conversion or continuation in accordance therewith.
E. Default Rate. Upon the occurrence and during the continuation of any Event of
Default, the outstanding principal amount of all Loans and, to the extent
permitted by applicable law, any interest payments thereon not paid when due and
any fees and other amounts then due and payable hereunder, shall thereafter bear
interest (including post-petition interest in any proceeding under the
Bankruptcy Code or other applicable bankruptcy laws) payable upon demand at a
rate that is 2.00% per annum in excess of the interest rate otherwise payable
under this Agreement with respect to the applicable Loans (or, in the case of
any such fees and other amounts, at a rate which is 2.00% per annum in excess of
the interest rate otherwise payable under this Agreement for Base Rate Loans);
provided that, in the case of LIBOR Loans, upon the expiration of the Interest
Period in effect at the time any such increase in interest rate is effective
such LIBOR Loans shall thereupon become Base Rate Loans and shall thereafter
bear interest payable upon demand at a rate which is 2.00% per annum in excess
of the interest rate otherwise payable under this Agreement for Base Rate Loans.
Payment or acceptance of the increased rates of interest provided for in this
subsection 2.2E is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Administrative Agent or any Lender.
F. Computation of Interest. Interest on the Loans shall be computed (i) in the
case of Base Rate Loans, on the basis of a 365-day year, and (ii) in the case of
LIBOR Loans, on the basis of a 360-day year, in each case for the actual number
of days elapsed in the period during which it accrues. In computing interest on
any Loan, the date of the making of such Loan or the first day of an Interest
Period applicable to such Loan or, with respect to a Base Rate Loan being
converted from a LIBOR Loan, the date of conversion of such LIBOR Loan to such
Base Rate Loan, as the case may be, shall be included, and the date of payment
of such Loan or the expiration date of an Interest Period applicable to such
Loan or, with respect to a Base Rate Loan being converted to a LIBOR Loan, the
date of conversion of such Base Rate Loan to such LIBOR Loan, as the case may
be, shall be excluded; provided that if a Loan is repaid on the same day on
which it is made, one day's interest shall be paid on that Loan.
2.3 Fees.
A. Commitment Fee. Borrower agrees to pay to Administrative Agent, for
distribution to each Lender in proportion to that Lender's Pro Rata Share of the
Revolving Loan Commitments, commitment fees for the period from and including
the Closing Date to and excluding the Revolving Loan Commitment Termination Date
equal to the average of the daily excess of the Revolving Loan Commitments over
the sum of (i) the aggregate principal amount of outstanding Revolving Loans
(but not any outstanding Swing Line Loans) plus (ii) the Letter of
Credit Usage multiplied by one half of 1% per annum, such commitment fees to be
calculated on the basis of a
360-day year and the actual number of days elapsed and to be payable quarterly
in arrears on the last Business Day of each March, June, September and December
of each Fiscal Year commencing on the first such date to occur after the Closing
Date, and on the Revolving Loan Commitment Termination Date.
B. Other Fees. Borrower agrees to pay to Lead Arranger and Administrative Agent
such fees in the amounts and at the times separately agreed upon between
Borrower, Lead Arranger and Administrative Agent.
2.4 Repayments and Prepayments; General Provisions Regarding Payments;
Application of Proceeds of Collateral and Payments Under Subsidiary Guaranty.
A. Scheduled Payments of Term Loans. Borrower shall make principal payments on
the Term Loans in installments on the dates and in the amounts set forth below:
Date Scheduled Payment
June 30, 2001 $1,250,000
September 30, 2001 $1,250,000
December 31, 2001 $1,250,000
March 31, 2002 $1,250,000
June 30, 2002 $1,875,000
September 30, 2002 $1,875,000
December 31, 2002 $1,875,000
March 31, 2003 $1,875,000
June 30, 2003 $2,500,000
September 30, 2003 $2,500,000
December 31, 2003 $2,500,000
March 31, 2004 $2,500,000
June 30, 2004 $3,125,000
September 30, 2004 $3,125,000
December 31, 2004 $3,125,000
March 31, 2005 $3,125,000
June 30, 2005 $32,500,000
September 30, 2005 $32,500,000
December 31, 2005 $32,500,000
March 31, 2006 $32,500,000
============
Total $165,000,000
; provided that the scheduled installments of principal of the Term Loans set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the Term Loans in accordance with subsection 2.4B(iv); and
provided, further that the Term Loans and all other amounts owed hereunder with
respect to the Term Loans shall be paid in full no later than March 31, 2006,
and the final installment payable by Borrower in respect of the Term Loans on
such date shall be in an amount, if such amount is different from that specified
above, sufficient to repay all amounts owing by Borrower under this Agreement
with respect to the Term Loans.
B. Prepayments and Unscheduled Reductions in Revolving Loan Commitments.
(i) Voluntary Prepayments. Borrower may, upon not less than one Business Day's
prior written notice, in the case of Base Rate Loans, and three Business Days'
prior written notice, in the case of LIBOR Loans, in each case given to
Administrative Agent by 12:00 Noon (New York City time) on the date required
(which written notice Administrative Agent will promptly transmit by
telefacsimile or electronic mail to each Lender), at any time and from time to
time prepay any Swing Line Loan on any Business Day in whole or in part in an
aggregate minimum amount of $100,000 and integral multiples of $50,000 in excess
of that amount, and any Term Loans or Revolving Loans on any Business Day in
whole or in part in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess of that amount; provided, -------- however, that
any LIBOR Loan may be prepaid on a day other than the expiration of the Interest
Period applicable thereto, only if Borrower pays the amounts due pursuant to
Section 2.6D caused by such prepayment. Notice of prepayment having been given
as aforesaid, the principal amount of the Loans specified in such notice shall
become due and payable on the prepayment date specified therein. Any such
voluntary prepayment shall be applied as specified in subsection 2.4B(iv).
(ii) Voluntary Reductions of Revolving Loan Commitments. Borrower may, upon not
less than three Business Days' prior written notice to Administrative Agent
(which written notice Administrative Agent will promptly transmit by
telefacsimile or electronic mail to each Lender), at any time and from time to
time terminate in whole or permanently reduce in part, without premium or
penalty, the Revolving Loan Commitments in an amount up to the amount by which
the Revolving Loan Commitments exceed the Total Utilization of Revolving Loan
Commitments at the time of such proposed termination or reduction; provided that
any such partial reduction of the Revolving Loan Commitments shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in
excess of that amount. Borrower's notice to Administrative Agent shall designate
the date (which shall be a Business Day) of such termination or reduction and
the amount of any partial reduction, and such termination or reduction of the
Revolving Loan Commitments shall be effective on the date specified in
Borrower's notice and shall reduce the Revolving Loan Commitment of each Lender
proportionately to its Pro Rata Share.
(iii) Mandatory Prepayments and Mandatory Reductions of Revolving Loan
Commitments. The Loans shall be prepaid and/or the Revolving Loan Commitments
shall be permanently reduced in the amounts and under the circumstances set
forth below, all such prepayments and/or reductions to be applied as set forth
below or as more specifically provided in subsection 2.4B(iv):
(a) Prepayments and Reductions From Net Asset Sale Proceeds. No later than the
date of receipt by Borrower or any of its Subsidiaries of any Net Asset Sale
Proceeds in respect of any Asset Sale, Borrower shall either (i) prepay the
Loans and/or the Revolving Loan Commitments shall be permanently reduced in an
aggregate amount equal to such Net Asset Sale Proceeds, or (ii) so long as no
Potential Event of Default or Event of Default shall have occurred and be
continuing and to the extent that aggregate Net Asset Sale Proceeds from the
Closing Date through the date of determination do not exceed $1,000,000, deliver
to Administrative Agent an Officers' Certificate setting forth (x) that portion
of such Net Asset Sale Proceeds that Borrower or such Subsidiary intends to
reinvest in equipment or other productive assets of the general type used in the
business of Borrower and its Subsidiaries within 180 days of such date of
receipt, and (y) such other information with respect to such reinvestment as
Administrative Agent may reasonably request, and Borrower shall, or shall cause
one or more of its Subsidiaries to, promptly and diligently apply such portion
to such reinvestment purposes. If Borrower elects clause (ii) above, Borrower
(x) shall deposit the applicable portion of the Net Asset Sale Proceeds intended
for reinvestment into the Collateral Account, and (y) on the 180th day after
receipt of such Net Asset Sale Proceeds by Borrower or any of its Subsidiaries,
any such Net Asset Sale Proceeds that have not theretofore been applied to the
Obligations or that have not been so reinvested as provided above shall be
transferred from the Collateral Account in order to prepay the Loans (and/or the
Revolving Loan Commitments shall be permanently reduced) in the full amount of
all such Net Asset Sale Proceeds.
(b) Prepayments and Reductions From Net Insurance/ Condemnation Proceeds. No
later than the first Business Day following the date of receipt by
Administrative Agent or by Borrower or any of its Subsidiaries of any Net
Insurance/Condemnation Proceeds that are required to be applied to prepay the
Loans and/or reduce the Revolving Loan Commitments pursuant to the provisions of
subsection 6.4C, Borrower shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount equal to the
amount of such Net Insurance/Condemnation Proceeds.
(c) Prepayments and Reductions Due to Reversion of Surplus Assets of Pension
Plans. On the date of return to Borrower or any of its Subsidiaries or any
surplus assets of any Pension Plan of Borrower or any of its Subsidiaries,
Borrower shall prepay the Loans and/or the Revolving Loan Commitments shall be
permanently reduced in an aggregate amount (such amount being the "Net Pension
Proceeds") equal to 100% of such returned surplus assets, net of transaction
costs and expenses incurred in obtaining such return, including incremental
taxes payable as a result thereof.
(d) Prepayments and Reductions Due to Issuance of Debt or Equity Securities. On
the date of receipt by Borrower of Net Securities Proceeds from the issuance
after the Closing Date of any debt or equity Securities of Borrower or any of
its Subsidiaries (other than (i) Net Securities Proceeds received from another
Loan Party, in connection with the exercise of stock options held by its
employees or independent sales representatives, or as part of the consideration
paid to any seller of assets in any acquisition permitted pursuant to subsection
7.7, and (ii) 50% of the Net Securities Proceeds from the issuance by Borrower
or of any of its Subsidiaries of its common stock in an IPO), Borrower shall, to
the extent such Net Securities Proceeds, when added to all Net Securities
Proceeds received by Borrower and its Subsidiaries since the Closing Date is
greater than $5,000,000, prepay the Loans and/or the Revolving Loan Commitments
shall be permanently reduced in an aggregate amount equal to such Net Securities
Proceeds.
(e) Prepayments and Reductions from Consolidated Excess Cash Flow. On the 180th
day after the end of each Fiscal Year, Borrower shall prepay the Loans and/or
the Revolving Loan Commitments shall be permanently reduced in an aggregate
amount equal to 75% of Consolidated Excess Cash Flow if the Consolidated Total
Leverage Ratio as of the last day of such Fiscal Year is greater than or equal
to 3.00:1.00, and 50% of Consolidated Excess Cash Flow if the Consolidated Total
Leverage Ratio as of the last day of such Fiscal Year is less than 3.00:1.00.
(f) Calculations of Net Proceeds Amounts; Additional Prepayments and Reductions
Based on Subsequent Calculations. Concurrently with any prepayment of the Loans
and/or reduction of the Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(e), Borrower shall deliver to Administrative Agent and Lenders an
Officers' Certificate demonstrating the calculation of the amount (the "Net
Proceeds Amount") of the applicable Net Asset Sale Proceeds or Net
Insurance/Condemnation Proceeds, the applicable Net Pension Proceeds or Net
Securities Proceeds (as such terms are defined in subsections 2.4B(iii)(c) and
(d)), or the applicable Consolidated Excess Cash Flow, as the case may be, that
gave rise to such prepayment and/or reduction. In the event that Borrower shall
subsequently determine that the actual Net Proceeds Amount was greater than the
amount set forth in such Officers' Certificate (including if any actual taxes to
be paid as a result of an Asset Sale is less than the estimated taxes to be paid
as a result of such Asset Sale), Borrower shall promptly make an additional
prepayment of the Loans (and/or, if applicable, the Revolving Loan Commitments
shall be permanently reduced) in an amount equal to the amount of such excess,
and Borrower shall concurrently therewith deliver to Administrative Agent and
Lenders an Officers' Certificate demonstrating the derivation of the additional
Net Proceeds Amount resulting in such excess.
(g) Prepayments Due to Reductions or Restrictions of Revolving Loan Commitments.
Borrower shall from time to time prepay first the Swing Line Loans, and second
the Revolving Loans pursuant to subsection 2.4B(iv)(d) to the extent necessary
so that the Total Utilization of Revolving Loan Commitments shall not at any
time exceed the lesser of the Revolving Loan Commitments or the Borrowing Base
then in effect.
(iv) Application of Prepayments.
--------------------------
(a) Application of Voluntary Prepayments by Type of Loans and Order of Maturity.
Subject to the provisions of subsection 2.4D, any voluntary prepayments pursuant
to subsection 2.4B(i) shall be applied as specified by Borrower in the
applicable notice of prepayment; provided that in the event Borrower fails to
specify the Loans to which any such prepayment shall be applied, such prepayment
shall be applied first to repay outstanding Term Loans to the full extent
thereof, second to repay outstanding Swing Line Loans to the full extent
thereof, and third to repay outstanding Revolving Loans to the full extent
thereof and permanently reduce the Revolving Loan Commitments. Any voluntary
prepayments of the Term Loans pursuant to subsection 2.4B(i) shall be applied to
reduce the scheduled installments of principal of the Term Loans set forth in
subsection 2.4A(ii) in inverse chronological order of maturity.
(b) Application of Mandatory Prepayments by Type of Loans. Any amount (the
"Applied Amount") required to be applied as a mandatory prepayment of the Term
Loans and/or a reduction of the Revolving Loan Commitments pursuant to
subsections 2.4B(iii)(a)-(e) shall be applied first to prepay the Term Loans to
the full extent thereof, second, to the extent of any remaining portion of the
Applied Amount, to prepay the Swing Line Loans to the full extent thereof and to
permanently reduce the Revolving Loan Commitments by the amount of such
prepayment, third, to the extent of any remaining portion of the Applied Amount,
to prepay the Revolving Loans to the full extent thereof and to further
permanently reduce the Revolving Loan Commitments by the amount of such
prepayment, and fourth, to the extent of any remaining portion of the Applied
Amount, to further permanently reduce the Revolving Loan Commitments to the full
extent thereof.
(c) Application of Mandatory Prepayments of Term Loans and the Scheduled
Installments of Principal Thereof. Any mandatory prepayments of the Term Loans
pursuant to subsection 2.4B(iii) shall be applied to reduce the scheduled
installments of principal of the Term Loans in inverse chronological order of
maturity.
(d) Application of Prepayments to Base Rate Loans and LIBOR Loans. Considering
Term Loans and Revolving Loans being prepaid separately, any prepayment thereof
shall be applied first to Base Rate Loans to the full extent thereof before
application to LIBOR Loans, in each case in a manner which minimizes the amount
of any payments required to be made by Borrower pursuant to subsection 2.6D.
(e) Prepayments of Term Loans Within Two Years of the Closing Date. Any
prepayments of the Term Loans pursuant to subsection 2.4B(i) or subsection
2.4B(iii) (other than prepayments pursuant to clauses (b), (c) and (e) of
subsection 2.4B(iii)) shall be subject to a premium equal to (i) with respect to
prepayments made on or before the first anniversary of the Closing Date, 1.00%
of the principal amount of Term Loans prepaid, and (ii) with respect to
prepayments made on or before the second anniversary of the Closing Date, 0.50%
of the principal amount of Term Loans prepaid.
(f) Notwithstanding the foregoing, Lenders with Term Loans outstanding may waive
the right to receive up to 50% of the amount of any voluntary or mandatory
prepayment (other than as provided below in this subsection 2.4B(iv)(f) and, in
any event, not including scheduled principal payments under subsection 2.4A),
and if any such Lender so elects, the amount that would otherwise have been
applied as a prepayment of such Lender's Term Loan shall be applied to the Term
Loans of those Lenders not waiving the right to such prepayment and shall
thereafter, at Borrower's option, be applied to the prepayment of the Revolving
Loans (without reducing the Revolving Loan Commitment) or applied to the
prepayment of the Term Loans. Accordingly, with respect to the amount of any
mandatory prepayment described in this subsection 2.4B(iv)(f) that is allocated
to the Term Loans (such amounts, the "Term Loan Prepayment Amount"), Borrower
will, in lieu of applying such amount to the prepayment of Term Loans as
provided in subsection 2.4B(iv)(b), on the date for such prepayment, (x) deposit
such amount in the Collateral Account pending application of such amount in
accordance with this subsection 2.4B(iv)(f), and (y) give Administrative Agent
written notice requesting that Administrative Agent prepare and provide to each
Lender a Prepayment Option Notice as described below. As promptly as practicable
after receiving such notice from Borrower, Administrative Agent will send to
each Lender a Prepayment Option Notice, which shall include an offer by Borrower
to prepay on the date (each a "Prepayment Date") that is 10 Business Days after
the date of the Prepayment Option Notice, the relevant Term Loans of such
Lender, by an amount equal to the portion of the Term Loan Prepayment Amount
indicated in such Lender's Prepayment Option Notice as being applicable to such
Lender's Term Loans (the "Pro Rata Prepayment Amount"). Any Lender that desires
to decline the prepayment of up to 50% of the prepayment of its Term Loans shall
so notify Administrative Agent at the address and telecopy number indicated in
the Prepayment Option Notice no later than 11:00 A.M. (New York City time) on or
prior to the fifth Business Day prior to the Prepayment Date and any Term Loan
Lender who does not so respond shall be deemed to have accepted the applicable
Pro Rata Prepayment Amount. On the Prepayment Date, (i) Administrative Agent
shall apply from the amount deposited in the Collateral Account pursuant to this
subsection 2.4B(iv)(f) the aggregate amount necessary to prepay that portion of
the outstanding Term Loans in respect of which Lenders have accepted prepayment
as described above (each such Lender, an "Accepting Lender"), and such amount
shall be applied to reduce the Term Loan Prepayment Amounts with respect to each
Accepting Lender, and (ii) at Borrower's option, Administrative Agent shall
apply from the amount deposited in the Collateral Account pursuant to this
subsection 2.4B(iv)(f) any remaining amounts to the prepayment of the Revolving
Loans, to the extent still outstanding (without reducing the Revolving Loan
Commitment) or as a prepayment of the Term Loans.
C. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Borrower of principal, interest,
fees and other Obligations hereunder and under the Notes shall be made in
Dollars in same day funds, without defense, setoff or counterclaim, free of any
restriction or condition, and delivered to Administrative Agent not later than
2:00 P.M. (New York City time) on the date due at the Administrative Agent's
Office for the account of Lenders; funds received by Administrative Agent after
that time on such due date shall be deemed to have been paid by Borrower on the
next succeeding Business Day. Notwithstanding the foregoing, payments of amounts
deposited in the Collateral Account pursuant to the proviso to subsection
2.4B(iv)(f) shall be deemed to have been paid by Borrower on the applicable date
or dates such amounts are applied to prepay LIBOR Loans. Borrower hereby
authorizes Administrative Agent to charge its accounts with Administrative Agent
in order to cause timely payment to be made to Administrative Agent of all
principal, interest, fees and expenses due hereunder (subject to sufficient
funds being available in its accounts for that purpose).
(ii) Application of Payments. Prior to any payments being applied to principal
or interest under this Agreement, such payments shall first be applied to any
outstanding and payable fees, costs, expenses, indemnities or other amounts
(aside from principal or interest due under the Loan Documents), as determined
in the reasonable opinion of Administrative Agent.
(iii) Application of Payments to Principal and Interest. Except as provided in
subsection 2.2C, all payments in respect of the principal amount of any Loan
shall include payment of accrued interest on the principal amount being repaid
or prepaid, and all such payments (and, in any event, any payments in respect of
any Loan on a date when interest is due and payable with respect to such Loan)
shall be applied to the payment of interest before application to principal.
(iv) Apportionment of Payments. Aggregate principal and interest payments in
respect of Term Loans and Revolving Loans shall be apportioned among all
outstanding Loans to which such payments relate, in each case proportionately to
Lenders' respective Pro Rata Shares. Administrative Agent shall promptly
distribute to each Lender, at its primary address set forth below its name on
the appropriate signature page hereof or at such other address as such Lender
may request, its Pro Rata Share of all such payments received by Administrative
Agent and the commitment fees of such Lender when received by Administrative
Agent pursuant to subsection 2.3. Notwithstanding the foregoing provisions of
this subsection 2.4C(iv), if, pursuant to the provisions of subsection 2.6C, any
Notice of Conversion/Continuation is withdrawn as to any Affected Lender or if
any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
LIBOR Loans, Administrative Agent shall give effect thereto in apportioning
payments received thereafter.
(v) Payments on Business Days. Whenever any payment to be made hereunder shall
be stated to be due on a day that is not a Business Day, such payment shall be
made on the next succeeding Business Day and such extension of time shall be
included in the computation of the payment of interest hereunder or of the
commitment fees hereunder, as the case may be.
(vi) Notation of Payment. Each Lender agrees that before disposing of any Note
held by it, or any part thereof (other than by granting participations therein),
that Lender will use reasonable efforts to make a notation thereon of all Loans
evidenced by that Note and all principal payments previously made thereon and of
the date to which interest thereon has been paid; provided that the failure to
make (or any error in the making of) a notation of any Loan made under such Note
shall not limit or otherwise affect the obligations of Borrower hereunder or
under such Note with respect to any Loan or any payments of principal or
interest on such Note; provided, further, that in the event of any inconsistency
the Register shall govern (absent manifest error).
D. Application of Proceeds of Collateral and Payments Under
Subsidiary Guaranty.
(i) Application of Certain Payments; Application of Proceeds of Collateral. Upon
the occurrence and during the continuation of an Event of Default, (a) all
payments received on account of the Obligations, whether from Borrower or
otherwise (other than under the Subsidiary Guaranty), shall be applied by
Administrative Agent against the Obligations, and (b) all proceeds received by
Administrative Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral under any Collateral Document
may, in the discretion of Administrative Agent, be held by Administrative Agent
as Collateral for, and/or (then or at any time thereafter) applied in full or in
part by Administrative Agent against, the applicable Secured Obligations (as
defined in such Collateral Document) in the following order of priority:
(a) To the payment of all costs and expenses of such sale, collection or other
realization, including reasonable compensation to Administrative Agent and its
agents and counsel, and all other expenses, liabilities and advances made or
incurred by Administrative Agent in connection therewith, and all amounts for
which Administrative Agent is entitled to indemnification under such Collateral
Document and all advances made by Administrative Agent thereunder for the
account of the applicable Loan Party, and to the payment of all costs and
expenses paid or incurred by Administrative Agent in connection with the
exercise of any right or remedy under such Collateral Document, all in
accordance with the terms of this Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess such proceeds, to the payment of all
other Secured Obligations (as defined in such Collateral Document) for the
ratable benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such proceeds, to the payment to or
upon the order of such Loan Party or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.
(ii) Application of Payments Under Subsidiary Guaranty. All payments received by
Administrative Agent under the Subsidiary Guaranty shall be applied promptly
from time to time by Administrative Agent in the following order of priority:
(a) To the payment of the costs and expenses of any collection or other
realization under the Subsidiary Guaranty, including reasonable compensation to
Administrative Agent and its agents and counsel, and all expenses, liabilities
and advances made or incurred by Administrative Agent in connection therewith,
all in accordance with the terms of this Agreement and the Subsidiary Guaranty;
(b) thereafter, to the extent of any excess such payments, to the payment of all
other Guarantied Obligations (as defined in the Subsidiary Guaranty for the
ratable benefit of the holders thereof); and
(c) thereafter, to the extent of any excess such payments, to the payment to the
applicable Subsidiary Guarantor or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.
2.5 Use of Proceeds.
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A. Term Loans. The proceeds of the Term Loans, together with proceeds of the
initial Revolving Loans (the "Acquisition Revolving Loans"), and the Cash
Contribution Proceeds shall be applied by Borrower to fund the Acquisition and
the Refinancing.
B. Revolving Loans. The proceeds of the Acquisition Revolving Loans shall be
applied by Borrower as provided in subsection 2.5A. The proceeds of any other
Revolving Loans and any Swing Line Loans shall be applied by Borrower and its
Subsidiaries for general corporate purposes, which may include the making of
intercompany loans to any of Borrower's wholly-owned domestic Subsidiaries, in
accordance with subsection 7.1(iv), for their own general corporate purposes.
C. Margin Regulations. No portion of the proceeds of any borrowing under this
Agreement shall be used by Borrower or any of its Subsidiaries in any manner
that might cause the borrowing or the application of such proceeds to violate
Regulation T, Regulation U or Regulation X of the Board of Governors of the
Federal Reserve System or any other regulation of such Board or to violate the
Exchange Act, in each case as in effect on the date or dates of such borrowing
and such use of proceeds.
2.6 Special Provisions Governing LIBOR Loans.
Notwithstanding any other provision of this Agreement to the contrary,
the following provisions shall govern with respect to LIBOR Loans as to the
matters covered:
A. Determination of Applicable Interest Rate. As soon as practicable after 12:00
Noon (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the LIBOR Loans for which an interest rate is then being
determined for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to Borrower and each
Lender.
B. Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBOR, Administrative Agent
shall on such date give notice (by telefacsimile or by telephone confirmed in
writing) to Borrower and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, LIBOR Loans until such time as
Administrative Agent notifies Borrower and Lenders that the circumstances giving
rise to such notice no longer exist and (ii) any Notice of Borrowing or Notice
of Conversion/Continuation given by Borrower with respect to the Loans in
respect of which such determination was made shall be deemed to be rescinded by
Borrower.
C. Illegality or Impracticability of LIBOR Loans. In the event that on any date
any Lender shall have determined (which determination shall be final and
conclusive and binding upon all parties hereto but shall be made only after
consultation with Borrower and Administrative Agent) that the making,
maintaining or continuation of its LIBOR Loans (i) has become unlawful as a
result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful)
or (ii) has become impracticable, or would cause such Lender material hardship,
as a result of contingencies occurring after the date of this Agreement which
materially and adversely affect the interbank Eurodollar market or the position
of such Lender in that market, then, and in any such event, such Lender shall be
an "Affected Lender" and it shall on that day give notice (by telefacsimile or
by telephone confirmed in writing) to Borrower and Administrative Agent of such
determination (which notice Administrative Agent shall promptly transmit to each
other Lender by telefacsimile or electronic mail). Thereafter (a) the obligation
of Affected Lender to make Loans as, or to convert Loans to, LIBOR Loans shall
be suspended until such notice shall be withdrawn by Affected Lender, (b) to the
extent such determination by Affected Lender relates to a LIBOR Loan then being
requested by Borrower pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Affected Lender shall make such Loan as (or convert
such Loan to, as the case may be) a Base Rate Loan, (c) Affected Lender's
obligation to maintain its outstanding LIBOR Loans (the "Affected Loans") shall
be terminated at the earlier to occur of the expiration of the Interest Period
then in effect with respect to the Affected Loans or when required by law, and
(d) the Affected Loans shall automatically convert into Base Rate Loans on the
date of such termination. Notwithstanding the foregoing, to the extent a
determination by an Affected Lender as described above relates to a LIBOR Loan
then being requested by Borrower pursuant to a Notice of Borrowing or a Notice
of Conversion/Continuation, Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which Affected Lender gives notice of its determination as described
above (which notice of rescission Administrative Agent shall promptly transmit
to each other Lender by telefacsimile or electronic mail). Except as provided in
the immediately preceding sentence, nothing in this subsection 2.6C shall affect
the obligation of any Lender other than an Affected Lender to make or maintain
Loans as, or to convert Loans to, LIBOR Loans in accordance with the terms of
this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest Periods. Borrower
shall compensate each Lender, upon written request by that Lender (which request
shall set forth the basis for requesting such amounts), for all reasonable
losses, expenses and liabilities (including any interest paid by that Lender to
lenders of funds borrowed by it to make or carry its LIBOR Loans and any loss,
expense or liability sustained by that Lender in connection with the liquidation
or re-employment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any LIBOR Loan does
not occur on a date specified therefor in a Notice of Borrowing or a telephonic
request for borrowing, or a conversion to or continuation of any LIBOR Loan does
not occur on a date specified therefor in a Notice of Conversion/Continuation or
a telephonic request for conversion or continuation, (ii) if any prepayment
(including any prepayment pursuant to subsection 2.4B(i)) or other principal
payment or any conversion of any of its LIBOR Loans occurs on a date prior to
the last day of an Interest Period applicable to that Loan, (iii) if any
prepayment of any of its LIBOR Loans is not made on any date specified in a
notice of prepayment given by Borrower, or (iv) as a consequence of any other
default by Borrower in the repayment of its LIBOR Loans when required by the
terms of this Agreement.
E. Booking of LIBOR Loans. Any Lender may make, carry or transfer LIBOR
Loans at, to, or for the
account of any of its branch offices or the office of an Affiliate of that
Lender.
F. Assumptions Concerning Funding of LIBOR Loans. Calculation of all amounts
payable to a Lender under this subsection 2.6 and under subsection 2.7A shall be
made as though that Lender had actually funded each of its relevant LIBOR Loans
through the purchase of a Eurodollar deposit bearing interest at the rate
obtained pursuant to clause (i) of the definition of Adjusted LIBOR in an amount
equal to the amount of such LIBOR Loan and having a maturity comparable to the
relevant Interest Period and through the transfer of such Eurodollar deposit
from an offshore office of that Lender to a domestic office of that Lender in
the United States of America; provided, however, that each Lender may fund each
of its LIBOR Loans in any manner it sees fit and the foregoing assumptions shall
be utilized only for the purposes of calculating amounts payable under this
subsection 2.6 and under subsection 2.7A.
G. LIBOR Loans After Default. After the occurrence of and during the
continuation of a Potential Event of Default or an Event of Default, (i)
Borrower may not elect to have a Loan be made or maintained as, or converted to,
a LIBOR Loan after the expiration of any Interest Period then in effect for that
Loan and (ii) subject to the provisions of subsection 2.6D, any Notice of
Borrowing or Notice of Conversion/ Continuation given by Borrower with respect
to a requested borrowing or conversion/ continuation that has not yet occurred
shall be deemed to be rescinded by Borrower.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the provisions of
subsection 2.7B (which shall be controlling with respect to the matters covered
thereby), in the event that any Lender shall determine (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to any
additional Tax with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
(ii) imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special
deposit, compulsory loan, FDIC insurance or similar requirement against
assets held by, or deposits or other liabilities in or for the account
of, or advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender (other than any such
reserve or other requirements with respect to LIBOR Loans that are
reflected in the definition of Adjusted LIBOR); or
(iii) imposes any other condition (other than with respect to a Tax matter)
on or affecting such Lender (or its applicable lending office) or its
obligations hereunder or the interbank Eurodollar market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrower shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrower (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. Unless otherwise required by applicable
law, all sums payable by Borrower under this Agreement and the other
Loan Documents shall be paid free and clear of, and without any
deduction or withholding on account of, any Tax imposed, levied,
collected, withheld or assessed by or within the United States of
America or any political subdivision in or of the United States of
America or any other jurisdiction from or to which a payment is made by
or on behalf of Borrower.
(ii) Grossing-up of Payments. If Borrower or any other Person is required by
law to make any deduction or withholding on account of any such Tax
from any sum paid or payable by Borrower to Administrative Agent or any
Lender under any of the Loan Documents:
(a) Borrower shall notify Administrative Agent of any such requirement or
any change in any such requirement as soon as Borrower becomes aware of
it;
(b) Borrower shall pay any such Tax when such Tax is due,
regardless of whether the liability for payment of such Tax
(i) is imposed on Borrower itself, Administrative Agent or any
Lender or (ii) relates to any portion of any sums paid or
payable to any Lender under any of the Loan Documents with
respect to which such Lender does not act for its own account;
(c) the sum payable by Borrower in respect of which the relevant
deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the
making of that deduction, withholding or payment,
Administrative Agent or such Lender, as the case may be,
receives on the due date a net sum equal to what it would have
received had no such deduction, withholding or payment been
required or made; and
(d) within 30 days after paying any sum from which it is required
by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is
required by clause (b) above to pay, Borrower shall deliver to
Administrative Agent and/or other affected parties evidence
satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the
relevant taxing or other authority;
provided that no such additional amount shall be required to be paid to
any Lender under clause (c) above (i) to the extent such additional
amount relates to a portion of any sums paid or payable to such Lender
under any of the Loan Documents with respect to which such Lender does
not act for its own account, or (ii) except to the extent that any
change after the date such Lender became a Lender in any such
requirement for a deduction, withholding or payment as is mentioned
therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date on which such
Lender became a Lender, in respect of payments to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
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(a) Each Lender that is organized under the laws of any jurisdiction other than
the United States or any state or other political subdivision thereof (for
purposes of this subsection 2.7B(iii), a "Non-US Lender") shall deliver to
Administrative Agent and to Borrower, on or prior to the Closing Date (in the
case of each Lender listed on the signature pages hereof) or on or prior to the
date of the Assignment Agreement pursuant to which it becomes a Lender (in the
case of each other Lender), and at such other times as may be necessary in the
determination of Borrower or Administrative Agent (each in the reasonable
exercise of its discretion), two original copies of Internal Revenue Service
Form W-8BEN or W-8ECI (or any successor forms) properly completed and duly
executed by such Lender, or, in the case of a Non-US Lender claiming exemption
from United States federal withholding tax under Section 871(h) or 881(c) of the
Internal Revenue Code with respect to payments of "portfolio interest", a form
W-8BEN, and, in the case of a Lender that has certified in writing to
Administrative Agent that it is not a "bank" (as defined in Section 881(c)(3)(A)
of the Internal Revenue Code), a certificate of such Lender certifying that such
Lender is not (i) a "bank" for purposes of Section 881(c) of the Internal
Revenue Code, (ii) a ten-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of Borrower, or (iii) a controlled
foreign corporation related to Borrower (within the meaning of Section 864(d)(4)
of the Internal Revenue Code) in each case together with any other certificate
or statement of exemption required under the Internal Revenue Code or the
regulations issued thereunder to establish that such Lender is not subject to
United States withholding tax with respect to any payments to such Lender of
interest payable under any of the Loan Documents.
(b) Each Non-US Lender, to the extent it does not act or ceases to act for its
own account with respect to any portion of any sums paid or payable to such
Lender under any of the Loan Documents (for example, in the case of a typical
participation by such Lender), shall deliver to Administrative Agent and to
Borrower, on or prior to the Closing Date (in the case of each Lender listed on
the signatures pages hereof), on or prior to the date of the Assignment
Agreement pursuant to which it becomes a Lender (in the case of each other
Lender), or on such later date when such Lender ceases to act for its own
account with respect to any portion of any such sums paid or payable, and at
such other times as may be necessary in the determination of Borrower or
Administrative Agent (each in the reasonable exercise of its discretion), (1)
two original copies of the forms or statements required to be provided by such
Lender under subsection 2.7B(iii)(a), properly completed and duly executed by
such Lender, to establish the portion of any such sums paid or payable with
respect to which such Lender acts for its own account that is not subject to
United States withholding tax, and (2) two original copies of Internal Revenue
Service Form W-8IMY (or any successor forms) properly completed and duly
executed by such Lender, together with any information, if any, such Lender
chooses to transmit with such form, and any other certificate or statement of
exemption required under the Internal Revenue Code or the regulations issued
thereunder, to establish that such Lender is not acting for its own account with
respect to a portion of any such sums payable to such Lender.
(c) Each Non-US Lender hereby agrees, from time to time after the initial
delivery by such Lender of such forms, whenever a lapse in time or change in
circumstances renders such forms, certificates or other evidence so delivered
obsolete or inaccurate in any material respect or in the event that, by virtue
of a change in law or regulations, such forms are no longer valid evidence of a
person's exemption from withholding tax which is reasonably satisfactory to the
Borrower, that such Lender shall promptly (1) deliver to Administrative Agent
and to Borrower two original copies of renewals, amendments or additional or
successor forms, properly completed and duly executed by such Lender, together
with any other certificate or statement of exemption required in order to
confirm or establish that such Lender is not subject to United States
withholding tax with respect to payments to such Lender under the Loan Documents
and, as the case may be, that such Lender does not act for its own account with
respect to any portion of any such payments, or (2) notify Administrative Agent
and Borrower of its inability to deliver any such forms, certificates or other
evidence.
(d) Borrower shall not be required to pay any additional amount to any Non-US
Lender under clause (c) of subsection 2.7B(ii) if such Lender shall have failed
to satisfy the requirements of clause (a), (b) or (c)(1) of this subsection
2.7B(iii); provided that if such Lender shall have satisfied the requirements of
subsection 2.7B(iii)(a) on the date such Lender became a Lender, nothing in this
subsection 2.7B(iii)(d) shall relieve Borrower of its obligation to pay any
amounts pursuant to subsection 2.7B(ii)(c) in the event that, as a result of any
change in any applicable law, treaty or governmental rule, regulation or order,
or any change in the interpretation, administration or application thereof, such
Lender is no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender is not
subject to withholding as described in subsection 2.7B(iii)(a).
C. Capital Adequacy Adjustment. If any Lender shall have determined that the
adoption, effectiveness, phase-in or applicability after the date hereof of any
law, rule or regulation (or any provision thereof) regarding capital adequacy,
or any change therein or in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
applicable lending office) with any guideline, request or directive regarding
capital adequacy (whether or not having the force of law) of any such
governmental authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of, or with reference to,
such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Borrower from
such Lender of the statement referred to in the next sentence, Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such controlling corporation on an after-tax basis for such reduction.
Such Lender shall deliver to Borrower (with a copy to Administrative Agent) a
written statement, setting forth in reasonable detail the basis of the
calculation of such additional amounts, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.
2.8 Obligation of Lenders and Issuing Lenders to Mitigate.
Each Lender and Issuing Lender agrees that, as promptly as practicable
after the officer of such Lender or Issuing Lender responsible for administering
the Loans or Letters of Credit of such Lender or Issuing Lender, as the case may
be, becomes aware of the occurrence of an event or the existence of a condition
that would cause such Lender to become an Affected Lender or that would entitle
such Lender or Issuing Lender to receive payments under subsection 2.7 or
subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Issuing Lender and any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, issue, fund or maintain the
Commitments of such Lender or the affected Loans or Letters of Credit of such
Lender or Issuing Lender through another lending or letter of credit office of
such Lender or Issuing Lender, or (ii) take such other measures as such Lender
or Issuing Lender may deem reasonable, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6 would be
materially reduced and if, as determined by such Lender or Issuing Lender in its
sole discretion, the making, issuing, funding or maintaining of such Commitments
or Loans or Letters of Credit through such other lending or letter of credit
office or in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such Commitments or Loans or Letters of
Credit or the interests of such Lender or Issuing Lender; provided that such
Lender or Issuing Lender will not be obligated to utilize such other lending or
letter of credit office pursuant to this subsection 2.8 unless Borrower agrees
to pay all incremental expenses incurred by such Lender or Issuing Lender as a
result of utilizing such other lending or letter of credit office as described
in clause (i) above. A certificate as to the amount of any such expenses payable
by Borrower pursuant to this subsection 2.8 (setting forth in reasonable detail
the basis for requesting such amount) submitted by such Lender or Issuing Lender
to Borrower (with a copy to Administrative Agent) shall be conclusive absent
manifest error.
Section 3. LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and
Lenders' Purchase of Participations Therein.
--------------------------------------------
A. Letters of Credit. In addition to Borrower requesting that Lenders make
Revolving Loans pursuant to subsection 2.1A(ii) and that Swing Line Lender make
Swing Line Loans pursuant to subsection 2.1A(iii), Borrower may request, in
accordance with the provisions of this subsection 3.1, from time to time during
the period from the Closing Date to but excluding the Revolving Loan Commitment
Termination Date, that one or more Lenders issue Letters of Credit for the
account of Borrower for the purposes specified in the definition of Letters of
Credit. Subject to the terms and conditions of this Agreement and in reliance
upon the representations and warranties of Borrower herein set forth, any one or
more Lenders may, but (except as provided in subsection 3.1B(ii)) shall not be
obligated to, issue such Letters of Credit in accordance with the provisions of
this subsection 3.1; provided that Borrower shall not request that any Lender
issue (and no Lender shall issue):
(i) any Letter of Credit if, after giving effect to such issuance, the Total
Utilization of Revolving Loan Commitments would exceed the lesser of the
Revolving Loan Commitments or the Borrowing Base then in effect;
(ii) any Letter of Credit if, after giving effect to such issuance, the Letter
of Credit Usage would exceed $15,000,000;
(iii) any Letter of Credit having an expiration date later than the earlier of
(a) ten days prior to the Revolving Loan Commitment Termination Date, and (b)
the date which is one year from the date of issuance of such Letter of Credit;
provided that the immediately preceding clause (b) shall not prevent any Issuing
Lender (but subject to clause (a) above) from agreeing that a Letter of Credit
will automatically be extended for one or more successive periods not to exceed
one year each unless such Issuing Lender elects not to extend for any such
additional period; and provided further that such Issuing Lender shall elect not
to extend such Letter of Credit if it has knowledge that an Event of Default or
Potential Event of Default has occurred and is continuing (and has not been
waived in accordance with subsection 10.6) at the time such Issuing Lender must
elect whether or not to allow such extension;
(iv) any Letter of Credit denominated in a currency other than Dollars; or
(v) any Letter of Credit that is otherwise unacceptable to the applicable
Issuing Lender in its reasonable discretion.
B. Mechanics of Issuance.
(i) Notice of Issuance. Whenever Borrower desires the issuance of a Letter of
Credit, it shall deliver to Administrative Agent a Notice of Issuance of Letter
of Credit substantially in the form of Exhibit III annexed hereto no later than
12:00 Noon (New York City time) at least five Business Days, or in each case
such shorter period as may be agreed to by the Issuing Lender in any particular
instance, in advance of the proposed date of issuance. The Notice of Issuance of
Letter of Credit shall specify (a) the proposed date of issuance (which shall be
a Business Day), (b) the face amount of the Letter of Credit, (c) the expiration
date of the Letter of Credit, (d) the name and address of the beneficiary, and
(e) either the verbatim text of the proposed Letter of Credit or the proposed
terms and conditions thereof, including a precise description of any documents
to be presented by the beneficiary which, if presented by the beneficiary prior
to the expiration date of the Letter of Credit, would require the Issuing Lender
to make payment under the Letter of Credit; provided that the Issuing Lender, in
its reasonable discretion, may require changes in the text of the proposed
Letter of Credit or any such documents; and provided, further that no Letter of
Credit shall require payment against a conforming draft to be made thereunder on
the same Business Day (under the laws of the jurisdiction in which the office of
the Issuing Lender to which such draft is required to be presented is located)
that such draft is presented if such presentation is made after 12:00 Noon (in
the time zone of such office of the Issuing Lender) on such Business Day.
Borrower shall notify the applicable Issuing Lender (and Administrative Agent,
if Administrative Agent is not such Issuing Lender) prior to the issuance of any
Letter of Credit in the event that any of the matters to which Borrower is
required to certify in the applicable Notice of Issuance of Letter of Credit is
no longer true and correct as of the proposed date of issuance of such Letter of
Credit, and upon the issuance of any Letter of Credit Borrower shall be deemed
to have re-certified, as of the date of such issuance, as to the matters to
which Borrower is required to certify in the applicable Notice of Issuance of
Letter of Credit.
(ii) Determination of Issuing Lender. Upon receipt by Administrative Agent of a
Notice of Issuance of Letter of Credit pursuant to subsection 3.1B(i) requesting
the issuance of a Letter of Credit, in the event Administrative Agent elects to
issue such Letter of Credit, Administrative Agent shall promptly so notify
Borrower, and Administrative Agent shall be the Issuing Lender with respect
thereto. In the event that Administrative Agent, in its sole discretion, elects
not to issue such Letter of Credit, Administrative Agent shall promptly so
notify Borrower, whereupon Borrower may request any other Lender to issue such
Letter of Credit by delivering to such Lender a copy of the applicable Notice of
Issuance of Letter of Credit. Any Lender so requested to issue such Letter of
Credit shall promptly notify Borrower and Administrative Agent whether or not,
in its sole discretion, it has elected to issue such Letter of Credit, and any
such Lender which so elects to issue such Letter of Credit shall be the Issuing
Lender with respect thereto.
(iii) Issuance of Letter of Credit. Upon satisfaction or waiver (in accordance
with subsection 10.6) of the conditions set forth in subsection 4.3, the Issuing
Lender shall issue the requested Letter of Credit in accordance with the Issuing
Lender's standard operating procedures.
(iv) Notification to Lenders. Upon the issuance of any Letter of Credit the
applicable Issuing Lender shall promptly notify Administrative Agent and each
other Lender of such issuance by telefacsimile or electronic mail (or by
telephone promptly confirmed by telefacsimile or electronic mail). Promptly
after receipt of such notice (or, if Administrative Agent is the Issuing Lender,
together with such notice), Administrative Agent shall notify each Lender by
telefacsimile or electronic mail (or by telephone promptly confirmed by
telefacsimile or electronic mail) of the amount of such Lender's respective
participation in such Letter of Credit, determined in accordance with subsection
3.1C.
C. Lenders' Purchase of Participations in Letters of Credit. Immediately upon
the issuance of each Letter of Credit, each Lender with a Revolving Loan
Commitment shall be deemed to, and hereby agrees to, have irrevocably purchased
from the Issuing Lender a participation in such Letter of Credit and any
drawings honored thereunder in an amount equal to such Lender's Pro Rata Share
of the maximum amount which is or at any time may become available to be drawn
thereunder.
3.2 Letter of Credit Fees.
Borrower agrees to pay the following amounts with respect to
Letters of Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting fee, payable directly
to the applicable Issuing Lender for its own account, equal to 0.125% per annum
of the daily amount available to be drawn under such Letter of Credit, and (b) a
letter of credit fee, payable to Administrative Agent for the account of those
Lenders with a Revolving Loan Commitment, equal to the Applicable LIBOR Margin
for Revolving Loans multiplied by the daily amount available to be drawn under
such Letter of Credit, each such fronting fee or letter of credit fee to be
payable in arrears on the last Business Day of each March, June, September and
December of each Fiscal Year commencing on the first such date to occur after
the Closing Date, and computed on the basis of a 360-day year for the actual
number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of each Letter of
Credit and each payment of a drawing made thereunder (without duplication of the
fees payable under clause (i) above), documentary and processing charges payable
directly to the applicable Issuing Lender for its own account in accordance with
such Issuing Lender's standard schedule for such charges in effect at the time
of such issuance, amendment, transfer or payment, as the case may be.
For purposes of calculating any fees payable under clauses (i) and (ii) of this
subsection 3.2, the daily amount available to be drawn under any Letter of
Credit shall be determined as of the close of business on any date of
determination. Promptly upon receipt by Administrative Agent of any amount
described in clause (i) or (ii) of this subsection 3.2, Administrative Agent
shall distribute to each Lender with a Revolving Loan Commitment its Pro Rata
Share of such amount.
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit.
------------------------------------------------------------------
A. Responsibility of Issuing Lender With Respect to Drawings. In determining
whether to honor any drawing under any Letter of Credit by the beneficiary
thereof, the Issuing Lender shall be responsible only to examine the documents
delivered under such Letter of Credit with reasonable care so as to ascertain
whether they appear on their face to be in accordance with the terms and
conditions of such Letter of Credit.
B. Reimbursement by Borrower of Amounts Paid Under Letters of Credit. In the
event an Issuing Lender has determined to honor a drawing under a Letter of
Credit issued by it, such Issuing Lender shall immediately notify Borrower and
Administrative Agent, and Borrower shall reimburse such Issuing Lender on or
before the Business Day immediately following the date on which such drawing is
honored (the "Reimbursement Date") in an amount in Dollars and in same day funds
equal to the amount of such honored drawing plus interest thereon at the rate of
interest for Revolving Loans that are Base Rate Loans for the period from the
date of drawing to the Reimbursement Date; provided that, anything contained in
this Agreement to the contrary notwithstanding, (i) unless Borrower shall have
notified Administrative Agent and such Issuing Lender prior to 12:00 Noon (New
York City time) on the date such drawing is honored that Borrower intends to
reimburse such Issuing Lender for the amount of such honored drawing plus such
interest with funds other than the proceeds of Revolving Loans, Borrower shall
be deemed to have given a timely Notice of Borrowing to Administrative Agent
requesting Lenders to make Revolving Loans that are Base Rate Loans on the
Reimbursement Date in an amount in Dollars equal to the amount of such honored
drawing plus such interest (and Administrative Agent shall promptly give notice
thereof to each Lender by telefacsimile or electronic mail or by telephone
promptly confirmed by telefacsimile or electronic mail), and (ii) subject to
satisfaction or waiver of the conditions specified in subsection 4.2B, Lenders
shall, on or before the Business Day immediately following the Reimbursement
Date, make Revolving Loans that are Base Rate Loans in the amount of such
honored drawing plus interest thereon at the rate of interest for Revolving
Loans that are Base Rate Loans for the period from the date of drawing to the
date on which such Revolving Loans are made, the proceeds of which shall be
applied directly by Administrative Agent to reimburse such Issuing Lender for
the amount of such honored drawing; and provided, further, that if for any
reason proceeds of Revolving Loans are not received by such Issuing Lender on or
before the Business Day immediately following the Reimbursement Date in an
amount equal to the amount of such honored drawing plus interest thereon at the
rate of interest for Revolving Loans that are Base Rate Loans for the period
from the date of drawing to the date on which such Revolving Loans are made,
Borrower shall reimburse such Issuing Lender, on demand, in an amount in same
day funds equal to the excess of (x) the amount of such honored drawing plus
interest thereon at the Base Rate for the period from the date of drawing to the
date on which such Revolving Loans are made over (y) the aggregate amount of
such Revolving Loans, if any, which are so received. Nothing in this subsection
3.3B shall be deemed to relieve any Lender from its obligation to make Revolving
Loans on the terms and conditions set forth in this Agreement, and Borrower
shall retain any and all rights it may have against any Lender resulting from
the failure of such Lender to make such Revolving Loans under this subsection
3.3B.
C. Payment by Lenders of Unreimbursed Amounts Paid Under Letters of Credit. (i)
Payment by Lenders. In the event that Borrower shall fail for any reason to
reimburse any Issuing Lender as provided in subsection 3.3B in an amount equal
to the amount of any drawing honored by such Issuing Lender under a Letter of
Credit issued by it, such Issuing Lender shall promptly notify each other Lender
with a Revolving Loan Commitment of the unreimbursed amount of such honored
drawing and of such other Lender's respective participation therein based on
such Lender's Pro Rata Share of the Revolving Loan Commitment by telefacsimile
or electronic mail or by telephone promptly confirmed by telefacsimile or
electronic mail. Each Lender with a Revolving Loan Commitment shall make
available to such Issuing Lender an amount equal to its respective
participation, in Dollars and in same day funds, at the office of such Issuing
Lender specified in such notice, not later than 2:00 P.M. (New York City time)
on the first Business Day (under the laws of the jurisdiction in which such
office of such Issuing Lender is located) after the date notified by such
Issuing Lender. In the event that any Lender with a Revolving Loan Commitment
fails to make available to such Issuing Lender on such Business Day the amount
of such Lender's participation in such Letter of Credit as provided in this
subsection 3.3C, such Issuing Lender shall be entitled to recover such amount on
demand from such Lender together with interest thereon at the rate customarily
used by such Issuing Lender for the correction of errors among banks for three
Business Days and thereafter at the Base Rate. Nothing in this subsection 3.3C
shall be deemed to prejudice the right of any Lender to recover from any Issuing
Lender any amounts made available by such Lender to such Issuing Lender pursuant
to this subsection 3.3C in the event that it is determined by the final judgment
of a court of competent jurisdiction that the payment with respect to a Letter
of Credit by such Issuing Lender in respect of which payment was made by such
Lender constituted gross negligence or willful misconduct on the part of such
Issuing Lender.
(ii) Distribution to Lenders of Reimbursements Received From Borrower. In the
event any Issuing Lender shall have been reimbursed by other Lenders pursuant to
subsection 3.3C(i) for all or any portion of any drawing honored by such Issuing
Lender under a Letter of Credit issued by it, such Issuing Lender shall promptly
distribute to each other Lender with a Revolving Loan Commitment which has paid
all amounts payable by it under subsection 3.3C(i) with respect to such honored
drawing such other Lender's Pro Rata Share of the Revolving Loan Commitment of
all payments subsequently received by such Issuing Lender from Borrower in
reimbursement of such honored drawing when such payments are received. Any such
distribution shall be made to a Lender at its primary address set forth below
its name on the appropriate signature page hereof or at such other address as
such Lender may request.
D. Interest on Amounts Paid Under Letters of Credit.
(i) Payment of Interest by Borrower. Borrower agrees to pay to each Issuing
Lender, with respect to drawings honored under any Letters of Credit issued by
it, interest on the amount paid by such Issuing Lender in respect of each such
honored drawing from the date such drawing is honored to but excluding the date
such amount is reimbursed by Borrower (including any such reimbursement out of
the proceeds of Revolving Loans pursuant to subsection 3.3B) at a rate equal to
(a) for the period from the date such drawing is honored to but excluding the
Reimbursement Date, the rate then in effect under this Agreement with respect to
Revolving Loans that are Base Rate Loans and (b) thereafter, a rate which is
2.00% per annum in excess of the rate of interest otherwise payable under this
Agreement with respect to Revolving Loans that are Base Rate Loans. Interest
payable pursuant to this subsection 3.3D(i) shall be computed on the basis of a
365-day or 366-day year, as the case may be, for the actual number of days
elapsed in the period during which it accrues and shall be payable on demand or,
if no demand is made, on the date on which the related drawing under a Letter of
Credit is reimbursed in full.
(ii) Distribution of Interest Payments by Issuing Lender. Promptly upon receipt
by any Issuing Lender of any payment of interest pursuant to subsection 3.3D(i)
with respect to a drawing honored under a Letter of Credit issued by it, (a)
such Issuing Lender shall distribute to each other Lender with a Revolving Loan
Commitment, out of the interest received by such Issuing Lender in respect of
the period from the date such drawing is honored to but excluding the date on
which such Issuing Lender is reimbursed for the amount of such drawing
(including any such reimbursement out of the proceeds of Revolving Loans
pursuant to subsection 3.3B), the amount that such other Lender would have been
entitled to receive in respect of the letter of credit fee that would have been
payable in respect of such Letter of Credit for such period pursuant to
subsection 3.2 if no drawing had been honored under such Letter of Credit, and
(b) in the event such Issuing Lender shall have been reimbursed by other Lenders
pursuant to subsection 3.3C(i) for all or any portion of such honored drawing,
such Issuing Lender shall distribute to each other Lender with a Revolving Loan
Commitment which has paid all amounts payable by it under subsection 3.3C(i)
with respect to such honored drawing such other Lender's Pro Rata Share of the
Revolving Loan Commitment of any interest received by such Issuing Lender in
respect of that portion of such honored drawing so reimbursed by other Lenders
for the period from the date on which such Issuing Lender was so reimbursed by
other Lenders to but excluding the date on which such portion of such honored
drawing is reimbursed by Borrower. Any such distribution shall be made to a
Lender at its primary address set forth below its name on the appropriate
signature page hereof or at such other address as such Lender may request.
3.4 Obligations Absolute.
The obligation of Borrower to reimburse each Issuing Lender for
drawings honored under the Letters of Credit issued by it and to repay any
Revolving Loans made by Lenders pursuant to subsection 3.3B and the obligations
of Lenders under subsection 3.3C(i) shall be unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, set-off, defense or other right which
Borrower or any Lender may have at any time against a beneficiary or
any transferee of any Letter of Credit (or any Persons for whom any
such transferee may be acting), any Issuing Lender or other Lender or
any other Person or, in the case of a Lender, against Borrower, whether
in connection with this Agreement, the transactions contemplated herein
or any unrelated transaction (including any underlying transaction
between Borrower or one of its Subsidiaries and the beneficiary for
which any Letter of Credit was procured);
(iii) any draft or other document presented under any 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) payment by the applicable Issuing Lender under any Letter of Credit
against presentation of a draft or other document which does not
substantially comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Borrower or any of
its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by any party
thereto;
(vii) any other circumstance or happening whatsoever, whether or not similar
to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event of Default shall
have occurred and be continuing;
provided, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 Indemnification; Nature of Issuing Lenders' Duties.
A. Indemnification. In addition to amounts payable as provided in subsection
3.6, Borrower hereby agrees to protect, indemnify, pay and save harmless each
Issuing Lender and each other Lender from and against any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses (including
reasonable fees, expenses and disbursements of counsel and allocated costs of
internal counsel) which such Issuing Lender or any such other Lender may incur
or be subject to as a consequence, direct or indirect, of (i) the issuance of
any Letter of Credit by such Issuing Lender, other than as a result of (a) the
gross negligence or willful misconduct of such Issuing Lender as determined by a
final judgment of a court of competent jurisdiction or (b) subject to the
following clause (ii), the wrongful dishonor by such Issuing Lender of a proper
demand for payment made under any Letter of Credit issued by it or (ii) the
failure of such Issuing Lender to honor a drawing under any such Letter of
Credit as a result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority (all
such acts or omissions herein called "Governmental Acts").
B. Nature of Issuing Lenders' Duties. As between Borrower and any Issuing
Lender, Borrower assumes all risks of the acts and omissions of, or misuse of
the Letters of Credit issued by such Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Lender shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
any such Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of such Issuing Lender, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of such Issuing
Lender's or any other Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by any Issuing Lender under or in connection with the Letters
of Credit issued by it or any documents and certificates delivered thereunder,
if taken or omitted in good faith, shall not put such Issuing Lender or any
other Lender under any resulting liability to Borrower.
Notwithstanding anything to the contrary contained in this subsection
3.5, Borrower shall retain any and all rights it may have against any Issuing
Lender for any liability arising solely out of the gross negligence or willful
misconduct of such Issuing Lender, as determined by a final judgment of a court
of competent jurisdiction.
3.6 Increased Costs and Taxes Relating to Letters of Credit.
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that any
Issuing Lender or Lender shall determine (which determination shall, absent
manifest error, be final and conclusive and binding upon all parties hereto)
that any law, treaty or governmental rule, regulation or order, or any change
therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by any
Issuing Lender or Lender with any guideline, request or directive issued or made
after the date hereof by any central bank or other governmental or
quasi-governmental authority (whether or not having the force of law):
(i) subjects such Issuing Lender or Lender (or its applicable lending or
letter of credit office) to any additional Tax (other than any Tax on
the overall net income of such Issuing Lender or Lender) with respect
to the issuing or maintaining of any Letters of Credit or the
purchasing or maintaining of any participations therein or any other
obligations under this Section 3, whether directly or by such being
imposed on or suffered by any particular Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve (including any
marginal, emergency, supplemental, special or other reserve), special
deposit, compulsory loan, FDIC insurance or similar requirement in
respect of any Letters of Credit issued by any Issuing Lender or
participations therein purchased by any Lender; or
(iii) imposes any other condition (other than with respect to a Tax matter)
on or affecting such Issuing Lender or Lender (or its applicable
lending or letter of credit office) regarding this Section 3 or any
Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Lender of agreeing to issue, issuing or maintaining any Letter of
Credit or agreeing to purchase, purchasing or maintaining any participation
therein or to reduce any amount received or receivable by such Issuing Lender or
Lender (or its applicable lending or letter of credit office) with respect
thereto; then, in any case, Borrower shall promptly pay to such Issuing Lender
or Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts as may be necessary to compensate such Issuing
Lender or Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Such Issuing Lender or Lender shall deliver to Borrower a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to such Issuing Lender or Lender under this
subsection 3.6, which statement shall be conclusive and binding upon all parties
hereto absent manifest error.
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters of
Credit hereunder are subject to the satisfaction of the following conditions.
4.1 Conditions to Term Loans and Initial
Revolving Loans and Swing Line Loans.
-------------------------------------
The obligations of Lenders to make the Term Loans and any Revolving
Loans and Swing Line Loans to be made on the Closing Date are, in addition to
the conditions precedent specified in subsection 4.2, subject to prior or
concurrent satisfaction of the following conditions:
A. Loan Party Documents. On or before the Closing Date, Borrower shall, and
shall cause each other Loan Party and BJI Mexico to, deliver to Lenders (or to
Administrative Agent for Lenders with sufficient originally executed copies,
where appropriate, for each Lender and its counsel) the following with respect
to Borrower, such Loan Party or BJI Mexico, as the case may be, each, unless
otherwise noted, dated the Closing Date:
(i) Certified copies of the Certificate or Articles of Incorporation or similar
formation documents of such Person, together with a good standing certificate
from the Secretary of State of its jurisdiction of incorporation and each other
state in which such Person is qualified as a foreign corporation to do business
and, to the extent generally available, a certificate or other evidence of good
standing as to payment of any applicable franchise or similar taxes from the
appropriate taxing authority of each of such jurisdictions, each dated a recent
date prior to the Closing Date;
(ii) Copies of the Bylaws or other similar organizational documents of such
Person, certified as of the Closing Date by such Person's corporate secretary or
an assistant secretary;
(iii) Resolutions of the Board of Directors or other similar governing body of
such Person approving and authorizing the execution, delivery and performance of
the Loan Documents and Related Agreements to which it is a party, certified as
of the Closing Date by the corporate secretary or an assistant secretary of such
Person as being in full force and effect without modification or amendment;
(iv) Signature and incumbency certificates of the officers of such Person
executing the Loan Documents to which it is a party;
(v) Executed originals of the Loan Documents to which such Person is a party;
and
(vi) Such other documents as Administrative Agent may reasonably request.
B. No Material Adverse Effect. Since December 31, 2000, no Material Adverse
Effect (in the reasonable opinion of Administrative Agent) shall have occurred.
C. Corporate and Capital Structure, Ownership, Management, Etc.
(i) Corporate Structure. The corporate organizational structure of Holdings
and its Subsidiaries, both before and after giving effect to the
Acquisition, shall be as set forth on Schedule 4.1C annexed hereto, and
shall be satisfactory to Administrative Agent and Lead Arranger.
(ii) Capital Structure and Ownership. The capital structure and ownership of
Borrower and Holdings, both before and after giving effect to the
Acquisition, shall be as set forth on Schedule 4.1C, and shall be
satisfactory to Administrative Agent and Lead Arranger.
(iii) Management; Employment Contracts. The management structure of Borrower
after giving effect to the Acquisition shall be as set forth on
Schedule 4.1C, and Administrative Agent shall have received copies of,
and shall be satisfied with the form and substance of, any and all
employment contracts with senior management of Borrower and BJI,
including the Employment Agreements.
(iv) Management Investors. Each of the Management Investors shall be
identified as such on Schedule 4.1C. The name of each Management
Investor shall be set forth on Schedule 4.1C along with (a) the amount
of Borrower Common Stock to be owned by such Management Investor on the
Closing Date immediately before giving effect to the Merger, the
Acquisition and the other transactions contemplated by this Agreement,
(b) and the amount of Holdings Common Stock to be owned by such
Management Investor immediately after giving effect to the Merger, the
Acquisition and the other transactions contemplated by this Agreement.
D. Necessary Governmental Authorizations and Consents; Expiration of Waiting
Periods, Etc. Borrower shall have obtained all Governmental Authorizations and
all consents of other Persons, in each case that are necessary or advisable in
connection with the Acquisition, the other transactions contemplated by the Loan
Documents and the Related Agreements, and the continued operation of the
business conducted by Borrower and its Subsidiaries in substantially the same
manner as conducted prior to the consummation of the Acquisition, and each of
the foregoing shall be in full force and effect, in each case other than those
the failure to obtain or maintain which, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
All applicable waiting periods shall have expired without any action being taken
or threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the Acquisition or the financing thereof.
No action, request for stay, petition for review or rehearing, reconsideration,
or appeal with respect to any of the foregoing shall be pending, and the time
for any applicable agency to take action to set aside its consent on its own
motion shall have expired.
E. Related Agreements.
(i) Approval of Related Agreements. Each of the Related Agreements shall
be satisfactory in form and substance to Administrative Agent.
(ii) Related Agreements in Full Force and Effect. Administrative Agent shall
have received a fully executed or conformed copy of each Related
Agreement and any documents executed in connection therewith, and each
Related Agreement shall be in full force and effect and no provision
thereof shall have been modified or waived in any respect determined by
Administrative Agent to be material, in each case without the consent
of Administrative Agent.
F. Termination of Existing Credit Agreements and Related Liens; Existing Letters
of Credit. On the Closing Date, Borrower and its Subsidiaries shall have (i)
repaid in full all outstanding Indebtedness of Borrower and its Subsidiaries,
other than Indebtedness permitted under subsection 7.1, (ii) terminated any
commitments to lend or make other extensions of credit thereunder, (iii)
delivered to Administrative Agent all documents or instruments necessary to
release all Liens securing Indebtedness or other obligations of Borrower and its
Subsidiaries thereunder, and (iv) made arrangements satisfactory to
Administrative Agent with respect to the cancellation of any letters of credit
outstanding thereunder or the issuance of Letters of Credit to support the
obligations of Borrower and its Subsidiaries with respect thereto.
G. Proceeds of Cash Contribution.
(i) Equity Capitalization of Borrower. On the Closing Date, (a) Borrower
shall have received the Cash Contribution Proceeds as a capital
contribution on terms and conditions acceptable to Administrative Agent
to provide a portion of the funds for the Acquisition, and all of the
proceeds of the Cash Contribution shall have been used for such
purpose, and (b) the WLFI Shareholders shall own no less than 70% of
the outstanding Holdings Common Stock.
(ii) Use of Cash Contribution Proceeds by Borrower. Borrower shall have
provided evidence satisfactory to Administrative Agent that the
proceeds of the Cash Contribution have been irrevocably committed,
prior to the application of the proceeds of the Term Loans and any
Revolving Loans made on the Closing Date, to the payment of a portion
of the Acquisition.
(iii) Sufficiency of Capitalization. Borrower shall have provided evidence
satisfactory to Administrative Agent that the proceeds of the Cash
Contribution, together with the proceeds of the initial Loans, are
sufficient to consummate the Acquisition.
H. Consummation of Merger, Acquisition and Share Contribution.
(i) Consummation of Merger. Contemporaneously with the application of the
proceeds of the initial Loans to be made on the Closing Date, the
closing of the Merger shall have been consummated in all respects in
accordance with the Merger Agreement and no term or condition of the
Merger Agreement shall have been amended, supplemented, waived or
otherwise modified in any respect determined by Administrative Agent to
be material;
(ii) Conditions to Merger. All conditions to the Merger set forth in the Merger
Agreement shall have been satisfied or the fulfillment of any such conditions
shall have been waived with the consent of Administrative Agent;
(iii) Effectiveness of Merger. The Merger shall have become effective in
accordance with the terms of the Merger Agreement and the Florida Business
Corporation Act;
(iv) Florida Filings. Administrative Agent shall have received satisfactory
evidence of the filing of the documents with the Secretary of State of the State
of Florida effecting the Merger on the Closing Date;
(v) Consummation of Acquisition. The Acquisition shall have been consummated in
accordance with the terms of the Acquisition Agreement;
(vi) Value of Acquisition. The total transaction value of the Acquisition
(including the Share Contribution) as of the Closing Date shall not exceed
$112,700,000;
(vii) Transaction Costs. Transaction Costs shall not exceed $9,000,000, and
Administrative Agent shall have received evidence to its satisfaction to such
effect;
(viii) Share Contribution. The Share Contribution shall have been made on terms
and conditions acceptable to Administrative Agent; and
(ix) Officers' Certificate. Administrative Agent shall have received an
Officers' Certificate of Borrower to the effect set forth in clauses (i)-(viii)
above.
I. Closing Date Mortgages; Closing Date Mortgage Policies; Etc. Administrative
Agent shall have received from Borrower and each applicable Subsidiary
Guarantor:
(i) Closing Date Mortgages. Fully executed and notarized Mortgages (each a
"Closing Date Mortgage" and, collectively, the "Closing Date Mortgages"),
in proper form for recording in all appropriate places in all applicable
jurisdictions, encumbering each Real Property Asset listed in Schedule 4.1I
annexed hereto (each a "Closing Date Mortgaged Property" and, collectively,
the "Closing Date Mortgaged Properties");
(ii) Title Insurance. (a) ALTA mortgagee title insurance policies or
unconditional commitments therefor (the "Closing Date Mortgage Policies")
issued by the Title Company with respect to each of the Closing Date
Mortgaged Properties, in amounts not less than the respective amounts
designated therein with respect to any particular Closing Date Mortgaged
Properties, insuring fee simple title to, or a valid leasehold interest in,
each such Closing Date Mortgaged Property vested in such Loan Party and
assuring Administrative Agent that the applicable Closing Date Mortgages
create valid and enforceable First Priority mortgage Liens on the
respective Closing Date Mortgaged Properties encumbered thereby, subject
only to a standard survey exception, which Closing Date Mortgage Policies
(1) shall include an endorsement for mechanics' liens, for future advances
under this Agreement and for any other matters reasonably requested by
Administrative Agent and (2) shall provide for affirmative insurance and
such reinsurance as Administrative Agent may reasonably request, all of the
foregoing in form and substance reasonably satisfactory to Administrative
Agent; and (b) evidence satisfactory to Administrative Agent that such Loan
Party has (i) delivered to the Title Company all certificates and
affidavits required by the Title Company in connection with the issuance of
the Closing Date Mortgage Policies and (ii) paid to the Title Company or to
the appropriate governmental authorities all expenses and premiums of the
Title Company in connection with the issuance of the Closing Date Mortgage
Policies and all recording and stamp taxes (including mortgage recording
and intangible taxes) payable in connection with recording the Closing Date
Mortgages in the appropriate real estate records;
(iii) Title Reports. With respect to each Closing Date Mortgaged Property,
a title report issued by the Title Company with respect thereto, dated not
more than 30 days prior to the Closing Date and satisfactory in form and
substance to Administrative Agent;
(iv) [intentionally omitted]
(v) Matters Relating to Flood Hazard Properties. (a) Evidence, which may be
in the form of a letter from an insurance broker or a municipal engineer,
as to whether (1) any Closing Date Mortgaged Property is a Flood Hazard
Property and (2) the community in which any such Flood Hazard Property is
located is participating in the National Flood Insurance Program, (b) if
there are any such Flood Hazard Properties, such Loan Party's written
acknowledgement of receipt of written notification from Administrative
Agent (1) as to the existence of each such Flood Hazard Property and (2) as
to whether the community in which each such Flood Hazard Property is
located is participating in the National Flood Insurance Program, and (c)
in the event any such Flood Hazard Property is located in a community that
participates in the National Flood Insurance Program, evidence that
Borrower has obtained flood insurance in respect of such Flood Hazard
Property to the extent required under the applicable regulations of the
Board of Governors of the Federal Reserve System;
(vi) Environmental Indemnity. An environmental indemnity agreement executed
by each of the Loan Parties, satisfactory in form and substance to
Administrative Agent and its counsel, with respect to the indemnification
of Administrative Agent and Lenders for any liabilities that may be imposed
on or incurred by any of them as a result of any Hazardous Materials
Activity; and
(vii) Opinions of Local Counsel. Upon request of Administrative Agent, an
opinion of counsel (which counsel shall be reasonably satisfactory to
Administrative Agent) in each state in which a Closing Date Mortgaged
Property is located with respect to the enforceability of the form(s) of
Closing Date Mortgages to be recorded in such state and such other matters
as Administrative Agent may reasonably request, in each case in form and
substance reasonably satisfactory to Administrative Agent.
J. Security Interests in Personal and Mixed Property. To the extent not
otherwise satisfied pursuant to subsection 4.1I, Administrative Agent shall have
received evidence satisfactory to it that Borrower and Subsidiary Guarantors
shall have taken or caused to be taken all such actions, executed and delivered
or caused to be executed and delivered all such agreements, documents and
instruments, and made or caused to be made all such filings and recordings
(other than the filing or recording of items described in clauses (iii), (iv)
and (v) below) that may be necessary or, in the opinion of Administrative Agent,
desirable in order to create in favor of Administrative Agent, for the benefit
of Lenders, a valid and (upon such filing and recording) perfected First
Priority security interest in the entire personal and mixed property Collateral.
Such actions shall include the following:
(i) Schedules to the Collateral Documents. Delivery to Administrative Agent
of accurate and complete schedules to all of the applicable the Collateral
Documents;
(ii) Stock Certificates and Instruments. Delivery to Administrative Agent
of (a) certificates (which certificates shall be accompanied by irrevocable
undated stock powers, duly endorsed in blank and otherwise satisfactory in
form and substance to Administrative Agent) representing all capital stock
pledged pursuant to the Security Agreement, and (b) all promissory notes or
other instruments (duly endorsed, where appropriate, in a manner
satisfactory to Administrative Agent) evidencing any Collateral;
(iii) Lien Searches and UCC Termination Statements. Delivery to
Administrative Agent of (a) the results of a recent search, by a Person
satisfactory to Administrative Agent, of all effective UCC financing
statements and fixture filings and all judgment and tax lien filings which
may have been made with respect to any personal or mixed property of any
Loan Party, together with copies of all such filings disclosed by such
search, and (b) UCC termination statements duly executed by all applicable
Persons for filing in all applicable jurisdictions as may be necessary to
terminate any effective UCC financing statements or fixture filings
disclosed in such search (other than any such financing statements or
fixture filings in respect of Liens permitted to remain outstanding
pursuant to the terms of this Agreement);
(iv) UCC Financing Statements and Fixture Filings. Delivery to
Administrative Agent of UCC financing statements and, where appropriate,
fixture filings, duly executed by each applicable Loan Party with respect
to all personal and mixed property Collateral of such Loan Party, for
filing in all jurisdictions as may be necessary or, in the opinion of
Administrative Agent, desirable to perfect the security interests created
in such Collateral pursuant to the Collateral Documents;
(v) PTO Cover Sheets, Etc. Delivery to Administrative Agent of all cover
sheets or other documents or instruments required to be filed with the PTO
in order to create or perfect Liens in respect of any IP Collateral; and
(vi) Opinions of Local Counsel. Upon request of Administrative Agent,
delivery to Administrative Agent of an opinion of counsel (which counsel
shall be reasonably satisfactory to Administrative Agent) under the laws of
each jurisdiction in which any Loan Party or any personal or mixed property
Collateral is located addressed to Administrative Agent and Lenders with
respect to the creation and perfection of the security interests in favor
of Administrative Agent in such Collateral and such other matters governed
by the laws of such jurisdiction regarding such security interests as
Administrative Agent may reasonably request, in each case in form and
substance reasonably satisfactory to Administrative Agent.
K. Environmental Reports. Administrative Agent shall have received reports and
other information, in form, scope and substance satisfactory to Administrative
Agent, regarding environmental matters relating to Borrower and its Subsidiaries
and the Facilities, which reports shall include a Phase I environmental
assessment or update for each of the Facilities listed in Schedule 4.1K which
(a) substantially conforms to the ASTM Standard Practice for Environmental Site
Assessments: Phase I Environmental Site Assessment Process, E 1527, (b) was
conducted by one or more environmental consulting firms reasonably satisfactory
to Administrative Agent, and (c) includes a visual assessment of suspect
asbestos-containing materials at such Facilities.
L. Financial Statements; Pro Forma Balance Sheet. On or before the Closing Date,
Lenders shall have received (i) audited financial statements of Borrower and its
Subsidiaries for Fiscal Years 1998, 1999 and 2000, consisting of balance sheets
and the related consolidated and consolidating statements of income,
stockholders' equity and cash flows for such Fiscal Years, (ii) unaudited
financial statements of Borrower and its Subsidiaries as at February 28, 2001,
consisting of a balance sheet and the related consolidated and consolidating
statements of income and cash flows for the two-month period ending on such
date, all in reasonable detail and certified by the chief financial officer of
Borrower that they fairly present the financial condition of Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to the absence of footnotes
and changes resulting from audit and normal year-end adjustments, (iii) the
unaudited consolidated balance sheet of BJI as at December 31, 2000 and the
related consolidated statements of income, stockholders' equity and cash flows
of BJI for the Fiscal Year then ended, (iv) the audited consolidated balance
sheet of BJI as at September 30, 2000, September 30, 1999 and September 30, 1998
and the related consolidated statements of income, stockholders' equity and cash
flows of BJI for the Fiscal Years then ended, and (v) the unaudited consolidated
balance sheet of BJI as at February 28, 2001 and the related unaudited
consolidated statements of income and cash flows of BJI for the two months then
ended, (vi) pro forma consolidated and consolidating balance sheets of Borrower
and its Subsidiaries as at the Closing Date, prepared in accordance with GAAP
and reflecting the consummation of the Acquisition, the related financings and
the other transactions contemplated by the Loan Documents and the Related
Agreements, which pro forma financial statements shall be in form and substance
satisfactory to Lenders, and (vii) a consolidated plan and financial forecast
for Borrower and its Subsidiaries for the Fiscal Year ending on December 31,
2001, which consolidated plan and financial forecast shall be in form and
substance satisfactory to Lenders.
M. Evidence of Insurance. Administrative Agent shall have received certificates
from the insurance brokers of Borrower and BJI or other evidence satisfactory to
it that all insurance required to be maintained pursuant to subsection 6.4 is in
full force and effect and that Administrative Agent on behalf of Lenders has
been named as additional insured and/or loss payee thereunder to the extent
required under subsection 6.4.
N. Opinions of Counsel to Loan Parties. Lenders and their respective counsel
shall have received (i) originally executed copies of one or more favorable
written opinions of counsel for the Loan Parties, in form and substance
reasonably satisfactory to Administrative Agent and its counsel, dated as of the
Closing Date, addressed to Administrative Agent and Lenders and substantially in
the form of Exhibit IX annexed hereto, and as to such other matters as
Administrative Agent acting on behalf of Lenders may reasonably request and (ii)
evidence satisfactory to Administrative Agent that Borrower has requested such
counsel to deliver such opinions to Lenders.
O. Opinions of Administrative Agent's Counsel. Lenders shall have received
originally executed copies of one or more favorable written opinions of
O'Melveny & Xxxxx LLP, counsel to Administrative Agent, dated as of the Closing
Date, substantially in the form of Exhibit X annexed hereto and as to such other
matters as Administrative Agent acting on behalf of Lenders may reasonably
request.
P. Opinions of Counsel Delivered Under Related Agreements. Administrative Agent
and its counsel shall have received (for delivery to Lenders) copies of each of
the opinions of counsel (if any) delivered to the parties under the Related
Agreements, together with a letter from each such counsel (to the extent not
inconsistent with such counsel's established internal policies) authorizing
Lenders to rely upon such opinion to the same extent as though it were addressed
to Lenders.
Q. Fees. Borrower shall have paid to Administrative Agent, for
distribution (as appropriate) to Administrative Agent and Lenders, the fees
payable on the Closing Date referred to in subsection 2.3.
R. Representations and Warranties; Performance of Agreements. Borrower shall
have delivered to Administrative Agent (for delivery to Lenders) an Officers'
Certificate, in form and substance satisfactory to Administrative Agent, to the
effect that the representations and warranties in Section 5 hereof are true,
correct and complete in all material respects on and as of the Closing Date to
the same extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Borrower shall have performed
in all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before the
Closing Date except as otherwise disclosed to and agreed to in writing by
Administrative Agent and Requisite Lenders.
S. Completion of Proceedings. All corporate and other proceedings taken or to be
taken in connection with the transactions contemplated hereby and all documents
incidental thereto not previously found acceptable by Administrative Agent,
acting on behalf of Lenders, and its counsel shall be satisfactory in form and
substance to Administrative Agent and such counsel, and Administrative Agent and
such counsel shall have received all such counterpart originals or certified
copies of such documents as Administrative Agent may reasonably request.
T. No Disruption of Financial Markets. There shall have not occurred any
material adverse change in the financial markets or in the financial condition
of Borrower, BJI and their respective Subsidiaries after December 31, 2000, as
determined by Administrative Agent in its sole discretion.
U. Solvency Assurances. On the Closing Date, Administrative Agent and Lenders
shall have received (i) an Officers' Certificate executed by the chief financial
officer of Borrower, dated the Closing Date, substantially in the form of
Exhibit XII-A and with appropriate attachments, demonstrating that, after giving
effect to the consummation of the Acquisition, the Refinancing and the other
transactions contemplated by this Agreement, Borrower, individually, and
Borrower and its Subsidiaries, taken as a whole, will be Solvent, and (ii) an
Officers' Certificate executed by the chief financial officer of Holdings, dated
the Closing Date, substantially in the form of Exhibit XII-B and with
appropriate attachments, demonstrating that, after giving effect to the
consummation of the Acquisition, the Refinancing and the other transactions
contemplated by this Agreement, Holdings, individually, and Holdings and its
Subsidiaries, taken as a whole, will be Solvent.
V. Maximum Consolidated Leverage Ratios; Minimum Consolidated EBITDA. On the
Closing Date, Administrative Agent shall have received an Officers' Certificate
executed by the chief financial officer of Borrower, dated the Closing Date,
with appropriate attachments, demonstrating that, after giving effect to the
consummation of the Acquisition, the Refinancing and the other transactions
contemplated by this Agreement, (i) the Consolidated Senior Leverage Ratio does
not exceed 2.75:1.00, and (ii) the Consolidated Total Leverage Ratio does not
exceed 4.25:1.00.
W. Minimum Senior Secured Debt Ratings. On or before the Closing Date, Borrower
shall deliver satisfactory evidence to Administrative Agent as to a minimum
senior secured debt rating of at least B+/Ba3 from S&P and Xxxxx'x,
respectively.
X. Borrowing Base Certificate. On or before the Closing Date, Borrower shall
have delivered to Administrative Agent a Borrowing Base Certificate, which shall
be satisfactory to Administrative Agent, prepared as of March 31, 2001.
Y. Sales Terms. On or before the Closing Date, Borrower shall have delivered
Schedule 4.1Y annexed hereto, which shall contain a description of the Sales
Terms of each Loan Party in form and substance satisfactory to Administrative
Agent.
4.2 Conditions to All Loans.
The obligations of Lenders to make Loans on each Funding Date are
subject to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding Date, in
accordance with the provisions of subsection 2.1B, an originally executed Notice
of Borrowing, in each case signed by the chief executive officer, the chief
financial officer or the treasurer of Borrower or by any executive officer of
Borrower designated by any of the above-described officers on behalf of Borrower
in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and in the other
Loan Documents shall be true, correct and complete in all material
respects on and as of that Funding Date to the same extent as though
made on and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case
such representations and warranties shall have been true, correct and
complete in all material respects on and as of such earlier date;
(ii) No event shall have occurred and be continuing or would result from the
consummation of the borrowing contemplated by such Notice of Borrowing
that would constitute an Event of Default or a Potential Event of
Default;
(iii) Each Loan Party shall have performed in all material respects all
agreements and satisfied all conditions which this Agreement provides
shall be performed or satisfied by it on or before that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator or governmental
authority shall purport to enjoin or restrain any Lender from making
the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date shall not
violate any law including Regulation T, Regulation U or Regulation X of
the Board of Governors of the Federal Reserve System; and
(vi) There shall not be pending or, to the knowledge of Borrower,
threatened, any action, suit, proceeding, governmental investigation
or arbitration against or affecting Borrower or any of its
Subsidiaries or any property of Borrower or any of its Subsidiaries
that has not been disclosed by Borrower in writing pursuant to
subsection 5.6 or 6.1(viii) prior to the making of the last preceding
Loans (or, in the case of the initial Loans, prior to the execution of
this Agreement), and there shall have occurred no development not so
disclosed in any such action, suit, proceeding, governmental
investigation or arbitration so disclosed, that, in either event, in
the opinion of Administrative Agent or of Requisite Lenders, could
reasonably be expected to have a Material Adverse Effect; and no
injunction or other restraining order shall have been issued and no
hearing to cause an injunction or other restraining order to be issued
shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans
hereunder.
4.3 Conditions to Letters of Credit.
The issuance of any Letter of Credit hereunder (whether or not the
applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
A. On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the
initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit, Administrative
Agent shall have received, in accordance with the provisions of subsection
3.1B(i), a Notice of Issuance of Letter of Credit, in each case signed by the
chief executive officer, the chief financial officer or the treasurer of
Borrower or by any executive officer of Borrower designated by any of the
above-described officers on behalf of Borrower in a writing delivered to
Administrative Agent, together with all other information specified in
subsection 3.1B(i) and such other documents or information as the applicable
Issuing Lender may reasonably require in connection with the issuance of such
Letter of Credit.
On the date of issuance of such Letter of Credit, all conditions precedent
described in subsection 4.2B shall be satisfied to the same extent as if the
issuance of such Letter of Credit were the making of a Loan and the date of
issuance of such Letter of Credit were a Funding Date.
Section 5. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make the
Loans, to induce Issuing Lenders to issue Letters of Credit and to induce other
Lenders to purchase participations therein, Borrower represents and warrants to
each Lender, on the date of this Agreement, on each Funding Date and on the date
of issuance of each Letter of Credit, that the following statements are true,
correct and complete:
5.1 Organization, Powers, Qualification,
Good Standing, Business and Subsidiaries.
A. Organization and Powers. Each Loan Party is a corporation duly organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation as specified in Schedule 5.1 annexed hereto. Each Loan Party has
all requisite corporate power and authority to own and operate its properties,
to carry on its business as now conducted and as proposed to be conducted, to
enter into the Loan Documents and Related Agreements to which it is a party and
to carry out the transactions contemplated thereby.
B. Qualification and Good Standing. Each Loan Party is qualified to do business
and in good standing in every jurisdiction where its assets are located and
wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had and could not reasonably be expected to have a Material Adverse Effect.
C. Conduct of Business. Borrower and its Subsidiaries are engaged only
in the businesses permitted to be engaged in pursuant to
subsection 7.14.
D. Subsidiaries. All of the outstanding capital stock of Borrower is owned by
Holdings. All of the Subsidiaries of Borrower are identified in Schedule 5.1
annexed hereto, as said Schedule 5.1 may be supplemented from time to time
pursuant to the provisions of subsection 6.1(xiv). The capital stock of Borrower
and each of its Subsidiaries identified in Schedule 5.1 annexed hereto (as so
supplemented) is duly authorized, validly issued, fully paid and nonassessable
and none of such capital stock constitutes Margin Stock. Each of the
Subsidiaries of Borrower identified in Schedule 5.1 annexed hereto (as so
supplemented) is a corporation duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of incorporation set
forth therein, has all requisite corporate power and authority to own and
operate its properties and to carry on its business as now conducted and as
proposed to be conducted, to enter into the Loan Documents to which it is a
party and to carry out the transactions contemplated thereby, and is qualified
to do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, in each
case except where failure to be so qualified or in good standing or a lack of
such corporate power and authority has not had and could not reasonably be
expected to have a Material Adverse Effect. Schedule 5.1 annexed hereto (as so
supplemented) correctly sets forth the ownership interest of Holdings and each
of its Subsidiaries in each of the Subsidiaries of Holdings identified therein.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and performance of the
Loan Documents and the Related Agreements have been duly authorized by all
necessary corporate action on the part of each Loan Party that is a party
thereto.
B. No Conflict. The execution, delivery and performance by Loan Parties of the
Loan Documents and the Related Agreements to which they are parties and the
consummation of the transactions contemplated by the Loan Documents and such
Related Agreements do not and will not (i) violate any provision of any law or
any governmental rule or regulation applicable to Borrower or any of its
Subsidiaries, the Certificate or Articles of Incorporation or Bylaws of Borrower
or any of its Subsidiaries or any order, judgment or decree of any court or
other agency of government binding on Borrower or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any Contractual Obligation of Borrower or any of
its Subsidiaries, (iii) result in or require the creation or imposition of any
Lien upon any of the properties or assets of Borrower or any of its Subsidiaries
(other than any Liens created under any of the Loan Documents in favor of
Administrative Agent on behalf of Lenders), or (iv) require any approval of
stockholders or any approval or consent of any Person under any Contractual
Obligation of Borrower or any of its Subsidiaries, except for such approvals or
consents which will be obtained on or before the Closing Date and disclosed in
writing to Lenders.
C. Governmental Consents. The execution, delivery and performance by Loan
Parties of the Loan Documents and the Related Agreements to which they are
parties and the consummation of the transactions contemplated by the Loan
Documents and such Related Agreements do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body.
D. Binding Obligation. Each of the Loan Documents and Related Agreements has
been duly executed and delivered by each Loan Party that is a party thereto and
is the legally valid and binding obligation of such Loan Party, enforceable
against such Loan Party in accordance with its respective terms, except as may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
relating to enforceability.
E. Valid Issuance of Common Stock. All of the Holdings Common Stock and Borrower
Common Stock outstanding on the Closing Date has been duly and validly issued,
is fully paid and nonassessable and is free and clear of any Liens in respect of
the issuance thereof. All such common stock has been registered or qualified
under applicable federal and state securities laws, or (b) is exempt therefrom.
5.3 Financial Condition.
Borrower has heretofore delivered, or caused to be delivered, to
Lenders, at Lenders' request, the following financial statements and
information: (i) the audited consolidated balance sheet of Borrower and its
Subsidiaries as at December 31, 2000, December 31, 1999 and December 31, 1998
and the related consolidated statements of income, stockholders' equity and cash
flows of Borrower and its Subsidiaries for the Fiscal Years then ended, (ii) the
unaudited consolidated balance sheet of Borrower and its Subsidiaries as at
February 28, 2001 and the related unaudited consolidated statements of income,
stockholders' equity and cash flows of Borrower and its Subsidiaries for the two
months then ended, (iii) the unaudited consolidated balance sheet of BJI as at
December 31, 2000 and the related consolidated statements of income,
stockholders' equity and cash flows of BJI for the Fiscal Year then ended, (iv)
the audited consolidated balance sheet of BJI as at September 30, 2000,
September 30, 1999 and September 30, 1998 and the related consolidated
statements of income, stockholders' equity and cash flows of BJI for the Fiscal
Years then ended, and (v) the unaudited consolidated balance sheet of BJI as at
February 28, 2001 and the related unaudited consolidated statements of income
and cash flows of BJI for the two months then ended. All such statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position (on a consolidated basis) of the entities described in
such financial statements as at the respective dates thereof and the results of
operations and cash flows (on a consolidated basis) of the entities described
therein for each of the periods then ended, subject, in the case of any such
unaudited financial statements, to the absence of footnotes and to changes
resulting from audit and normal year-end adjustments. Borrower and its
Subsidiaries do not (and will not following the funding of the initial Loans)
have any Contingent Obligation, contingent liability or liability for taxes,
long-term lease or unusual forward or long-term commitment that is not reflected
in the foregoing financial statements or the notes thereto and which in any such
case is material in relation to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Borrower or any of its
Subsidiaries.
5.4 No Material Adverse Change; No Restricted Junior Payments.
Since December 31, 2000, no event or change has occurred that has
caused or evidences, either in any case or in the aggregate, a Material Adverse
Effect. Neither Borrower nor any of its Subsidiaries has directly or indirectly
declared, ordered, paid or made, or set apart any sum or property for, any
Restricted Junior Payment or agreed to do so except as permitted by subsection
7.5.
5.5 Title to Properties; Liens; Real Property.
A. Title to Properties; Liens. Borrower and its Subsidiaries have (i) good,
sufficient and legal title to (in the case of fee interests in real property),
(ii) valid leasehold interests in (in the case of leasehold interests in real or
personal property), or (iii) good title to (in the case of all other personal
property), all of their respective properties and assets reflected in the
financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, in each case except
for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under subsection 7.7.
Except as permitted by this Agreement, all such properties and assets are free
and clear of Liens.
B. Real Property. As of the Closing Date, Schedule 5.5B annexed hereto contains
a true, accurate and complete list of (i) all fee interests in any Real Property
Assets, and (ii) all leases, subleases or assignments of leases (together with
all amendments, modifications, supplements, renewals or extensions of any
thereof) affecting each Real Property Asset, regardless of whether a Loan Party
is the landlord or tenant (whether directly or as an assignee or successor in
interest) under such lease, sublease or assignment. Each agreement listed in
Schedule 5.5B pursuant to clause (ii) of the immediately preceding sentence is
in full force and effect and Borrower does not have knowledge of any default
that has occurred and is continuing thereunder, and each such agreement
constitutes the legally valid and binding obligation of each applicable Loan
Party, enforceable against such Loan Party in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
C. Intellectual Property. As of the Closing Date, Borrower and its Subsidiaries
own or have the right to use, all Intellectual Property used in the conduct of
their business, except where the failure to own or have such right to use,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. No claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor does
Borrower know of any valid basis for any such claim except for such claims that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. The use of such Intellectual Property by Borrower and
its Subsidiaries does not infringe on the rights of any Person, except for such
claims and infringements that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. All federal and
state and all foreign registrations of and applications for Intellectual
Property, and all unregistered Intellectual Property, that are owned or licensed
by Borrower or any of its Subsidiaries on the Closing Date are described on
Schedule 5.5C annexed hereto.
5.6 Litigation; Adverse Facts.
Except as set forth in Schedule 5.6 annexed hereto, there are no
actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of Borrower or any of its Subsidiaries) at
law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign (including any Environmental Claims) that are pending or, to
the knowledge of Borrower, threatened against or affecting Borrower or any of
its Subsidiaries or any property of Borrower or any of its Subsidiaries and
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. Neither Borrower nor any of its Subsidiaries (i)
is in violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, or (ii) is subject to or in default with respect to any
final judgments, writs, injunctions, decrees, rules or regulations of any court
or any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.
5.7 Payment of Taxes.
Except to the extent permitted by subsection 6.3, all tax returns and
reports of Borrower and its Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and
payable and all assessments, fees and other governmental charges upon Borrower
and its Subsidiaries and upon their respective properties, assets, income,
businesses and franchises which are due and payable have been paid when due and
payable. Borrower knows of no proposed tax assessment against Borrower or any of
its Subsidiaries that is not being actively contested by Borrower or such
Subsidiary in good faith and by appropriate proceedings; provided that such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
5.8 Performance of Agreements; Materially Adverse Agreements;
Material Contracts.
A. Neither Borrower nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
B. Neither Borrower nor any of its Subsidiaries is a party to or is otherwise
subject to any agreements or instruments or any charter or other internal
restrictions which, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.
C. Schedule 5.8 contains a true, correct and complete list of all the Material
Contracts in effect on the Closing Date. All such Material Contracts are in full
force and effect and no defaults currently exist thereunder, except for defaults
which, individually or in the aggregate, could not reasonably be deemed to have
a Material Adverse Effect.
5.9 Governmental Regulation.
Neither Borrower nor any of its Subsidiaries is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
unenforceable.
5.10 Securities Activities.
A. Neither Borrower nor any of its Subsidiaries is engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not more than 25% of the
value of the assets (either of Borrower only or of Borrower and its Subsidiaries
on a consolidated basis) subject to the provisions of subsection 7.2 or 7.7 or
subject to any restriction contained in any agreement or instrument, between
Borrower and any Lender or any Affiliate of any Lender, relating to Indebtedness
and within the scope of subsection 8.2, will be Margin Stock.
5.11 Employee Benefit Plans.
A. Borrower, each of its Subsidiaries and each of their respective ERISA
Affiliates are in compliance in all material respects with all applicable
provisions and requirements of ERISA and the regulations and published
interpretations thereunder with respect to each Employee Benefit Plan, and have
performed all their obligations under each Employee Benefit Plan in all material
respects. Each Employee Benefit Plan that is intended to qualify under Section
401(a) of the Internal Revenue Code is so qualified.
B. No ERISA Event has occurred or is reasonably expected to occur.
C. Except to the extent required under Section 4980B of the Internal Revenue
Code or except as set forth in Schedule 5.11 annexed hereto, no Employee Benefit
Plan provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates.
D. As of the most recent valuation date for any Pension Plan, the amount of
unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA),
individually or in the aggregate for all Pension Plans (excluding for purposes
of such computation any Pension Plans with respect to which assets exceed
benefit liabilities), does not exceed $1,000,000.
E. As of the most recent valuation date for each Multiemployer Plan (if any) for
which the actuarial report is available, the potential liability of Borrower,
its Subsidiaries and their respective ERISA Affiliates for a complete withdrawal
from such Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, does not exceed $1,000,000.
5.12 Certain Fees.
Except for a transaction fee not to exceed $1,400,000 payable to
Trivest in connection with the consummation of the Acquisition, no broker's or
finder's fee or commission will be payable with respect to this Agreement, the
Acquisition or any of the other transactions contemplated by the Loan Documents
and the Related Agreements, and Borrower hereby indemnifies Lenders against, and
agrees that it will hold Lenders harmless from, any claim, demand or liability
for any such broker's or finder's fees alleged to have been incurred in
connection herewith or therewith and any expenses (including reasonable fees,
expenses and disbursements of counsel) arising in connection with any such
claim, demand or liability.
5.13 Environmental Protection.
Except as set forth in Schedule 5.13 annexed hereto:
(i) neither Borrower nor any of its Subsidiaries nor any of their
respective Facilities or operations are subject to any outstanding
written order, consent decree or settlement agreement with any Person
relating to (a) any Environmental Law, (b) any Environmental Claim, or
(c) any Hazardous Materials Activity that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect;
(ii) neither Borrower nor any of its Subsidiaries has received any
letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 X.X.X.xx. 9604) or any comparable state law;
(iii) there are and, to Borrower's knowledge, have been no conditions,
occurrences, or Hazardous Materials Activities which could reasonably
be expected to form the basis of an Environmental Claim against
Borrower or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect;
(iv) neither Borrower nor any of its Subsidiaries nor, to Borrower's
knowledge, any predecessor of Borrower or any of its Subsidiaries has
filed any notice under any Environmental Law indicating past or present
treatment of Hazardous Materials at any Facility, and none of
Borrower's or any of its Subsidiaries' operations involves the
generation, transportation, treatment, storage or disposal of hazardous
waste, as defined under 40 C.F.R. Parts 260-270 or any state
equivalent; and
(v) compliance with all current or reasonably foreseeable future
requirements pursuant to or under Environmental Laws could not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Notwithstanding anything in this subsection 5.13 to the contrary, no
event or condition has occurred or is occurring with respect to Borrower or any
of its Subsidiaries relating to any Environmental Law, any Release of Hazardous
Materials, or any Hazardous Materials Activity, including any matter disclosed
on Schedule 5.13 annexed hereto, which individually or in the aggregate has had
or could reasonably be expected to have a Material Adverse Effect.
5.14 Employee Matters.
There is no strike or work stoppage in existence or threatened
involving Borrower or any of its Subsidiaries that could reasonably be expected
to have a Material Adverse Effect, and there are no strikes or walkouts in
progress, pending or to Borrower's knowledge contemplated relating to any labor
contracts to which Borrower or any of its Subsidiaries is a party, relating to
any labor contracts being negotiated, or otherwise.
5.15 Solvency.
Each Loan Party is and, upon the incurrence of any Obligations by such
Loan Party on any date on which this representation is made, will be, Solvent.
5.16 Matters Relating to Collateral.
A. Creation, Perfection and Priority of Liens. The execution and delivery of the
Collateral Documents by Loan Parties, together with (i) the actions taken on or
prior to the date hereof pursuant to subsections 4.1I, 4.1J, 6.8 and 6.9 and
(ii) the delivery to Administrative Agent of any Pledged Collateral not
delivered to Administrative Agent at the time of execution and delivery of the
applicable Collateral Document (all of which Pledged Collateral has been so
delivered) are effective to create in favor of Administrative Agent for the
benefit of Lenders, as security for the respective Secured Obligations (as
defined in the applicable Collateral Document in respect of any Collateral), a
valid and perfected First Priority Lien on all of the Collateral, and all
filings and other actions necessary or desirable to perfect and maintain the
perfection and First Priority status of such Liens have been duly made or taken
and remain in full force and effect, other than the filing of any UCC financing
statements delivered to Administrative Agent for filing (but not yet filed) and
the periodic filing of UCC continuation statements in respect of UCC financing
statements filed by or on behalf of Administrative Agent.
B. Governmental Authorizations. No authorization, approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for either (i) the pledge or grant by any Loan Party of the Liens
purported to be created in favor of Administrative Agent for the benefit of the
Lenders pursuant to any of the Collateral Documents or (ii) the exercise by
Administrative Agent of any rights or remedies in respect of any Collateral
(whether specifically granted or created pursuant to any of the Collateral
Documents or created or provided for by applicable law), except for filings or
recordings contemplated by subsection 5.16A and except as may be required, in
connection with the disposition of any Pledged Collateral, by laws generally
affecting the offering and sale of Securities.
C. Absence of Third-Party Filings. Except such as may have been filed in favor
of Administrative Agent for the benefit of the Lenders as contemplated by
subsection 5.16A, (i) no effective UCC financing statement, fixture filing or
other instrument similar in effect covering all or any part of the Collateral is
on file in any filing or recording office and (ii) no effective filing covering
all or any part of the IP Collateral is on file in the PTO.
D. Margin Regulations. The pledge of the Pledged Collateral pursuant to the
Collateral Documents does not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
E. Information Regarding Collateral. All information supplied to Administrative
Agent by or on behalf of any Loan Party with respect to any of the Collateral
(in each case taken as a whole with respect to any particular Collateral) is
accurate and complete in all material respects.
5.17 Related Agreements.
A. Delivery of Related Agreements. Borrower has delivered to Lenders complete
and correct copies of each Related Agreement and of all exhibits and schedules
thereto.
B. Representations and Warranties. Each of the representations and warranties
given by Borrower, Sellers and BJI in the Acquisition Agreement is true and
correct in all material respects as of the date hereof (or as of any earlier
date to which such representation and warranty specifically relates) and will be
true and correct in all material respects as of the Closing Date (or as of such
earlier date, as the case may be), in each case subject to the qualifications
set forth in the schedules to the Acquisition Agreement.
C. Survival. Notwithstanding anything in the Acquisition Agreement to the
contrary, the representations and warranties set forth in subsection 5.17B
shall, solely for purposes of the Loan Documents, survive the Closing Date for
the benefit of Lenders.
5.18 Accounts Receivable.
Each Account reflected in the computations included in any Borrowing
Base Certificate meets the criteria enumerated in clauses (a) through (p) of the
definition of Eligible Account Receivable, except as disclosed in such Borrowing
Base Certificate or as disclosed in a timely manner in a subsequent Borrowing
Base Certificate or otherwise in writing to Administrative Agent. Borrower has
no knowledge of any fact or circumstance not disclosed to Administrative Agent
in a Borrowing Base Certificate or otherwise in writing which would impair the
validity or collectibility of any Eligible Account Receivable of $250,000 or
more or of Eligible Accounts Receivable which (regardless of the individual
amount thereof) aggregate $500,000 or more.
5.19 Inventory.
All Inventory included in any Borrowing Base Certificate delivered to
Administrative Agent meets the criteria enumerated in clauses (a) through (h) of
the definition of Eligible Inventory, except as disclosed in such Borrowing Base
Certificate or in a subsequent Borrowing Base Certificate, or as otherwise
specifically disclosed in writing to the Administrative Agent.
5.20 Disclosure.
No representation or warranty of Trivest or any Loan Party or any of
their Subsidiaries contained in the Confidential Information Memorandum or in
any Loan Document or Related Agreement or in any other document, certificate or
written statement furnished to Lenders by or on behalf of Trivest or any Loan
Party or any of its Subsidiaries for use in connection with the transactions
contemplated by this Agreement contains any untrue statement of a material fact
or omits to state a material fact (known to Borrower, in the case of any
document not furnished by it) necessary in order to make the statements
contained herein or therein not misleading in light of the circumstances in
which the same were made. Any projections and pro forma financial information
contained in such materials are based upon good faith estimates and assumptions
believed by Borrower to be reasonable at the time made, it being recognized by
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may differ from the projected results. There are no facts known (or
which should upon the reasonable exercise of diligence be known) to Borrower
(other than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein or in such other documents, certificates
and statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
5.21 Subordination.
The subordination provisions of the Senior Subordinated Notes and the
Subordinated Note Indenture are enforceable against the holders thereof. The
Loans and all other monetary Obligations hereunder (a) constitute Designated
Senior Debt under the Senior Subordinated Notes and the Subordinated Note
Indenture, and (b) are and will be within the definition of "Senior
Indebtedness" in the Subordinated Note Indenture.
5.22 Mortgage Taxes, Etc..
All mortgage, note, transfer, documentary, stamp, intangible and other
similar taxes and impositions which may be required to be paid in connection
with the Loans, the Mortgages and the other Loan Documents have been (or
concurrently with the closing of the Loans and recording of the Mortgages, will
be) paid in full by Borrower.
5.23 Foreign Subsidiaries.
As of the Closing Date, Pompeii Mexico and BJI Mexico are the only
non-domestic Subsidiaries of Borrower. The aggregate fair market value of the
assets owned by Pompeii Mexico does not exceed $10,000.
Section 6. BORROWER'S AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations, unless Requisite Lenders shall otherwise give prior
written consent, Borrower shall perform, and shall cause each of its
Subsidiaries to perform, all covenants in this Section 6.
6.1 Financial Statements and Other Reports.
Borrower will maintain, and cause each of its Subsidiaries to maintain,
a system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in conformity
with GAAP; provided that monthly financial statements shall not be required to
have footnote disclosure. Borrower will deliver to Administrative Agent and
Lenders:
(i) Monthly Financials: as soon as available, and in any event within 30 days
after the end of each month ending after the Closing Date, (a) (1) the
consolidated balance sheet of Borrower and its Subsidiaries as at the end of
such month, (2) the related consolidated (and consolidating by business segment)
statements of income of Borrower and its Subsidiaries for such month and for the
period from the beginning of the then current Fiscal Year to the end of such
month, and (3) the related consolidated (and consolidating by business segment)
cash flows of Borrower and its Subsidiaries for the period from the beginning of
the then current Fiscal Year to the end of such month, setting forth in each
case in comparative form the corresponding figures for the corresponding periods
of the previous Fiscal Year and the corresponding figures from the Financial
Plan for the current Fiscal Year, to the extent prepared on a monthly basis, all
in reasonable detail and certified by the chief financial officer or chief
executive officer of Borrower that they fairly present, in all material
respects, the financial condition of Borrower and its Subsidiaries as at the
dates indicated and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal year-end
adjustments, (b) upon reasonable request of Administrative Agent, a narrative
report describing the operations of Borrower and its Subsidiaries in the form
prepared for presentation to senior management for such month and for the period
from the beginning of the then current Fiscal Year to the end of such month, and
(c) a Borrowing Base Certificate;
(ii) Quarterly Financials: as soon as available and in any event within 45 days
after the end of each Fiscal Quarter (other than each fourth Fiscal Quarter) (a)
(1) the consolidated balance sheets of Borrower and its Subsidiaries as at the
end of such Fiscal Quarter, (2) the related consolidated (and consolidating by
business segment) statements of income of Borrower and its Subsidiaries for such
Fiscal Quarter and for the period from the beginning of the then current Fiscal
Year to the end of such Fiscal Quarter, and (3) the related consolidated (and
consolidating by business segment) cash flows of Borrower and its Subsidiaries
for the period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous Fiscal Year,
all in reasonable detail and certified by the chief financial officer of
Borrower that they fairly present, in all material respects, the financial
condition of Borrower and its Subsidiaries as at the dates indicated and the
results of their operations and their cash flows for the periods indicated,
subject to changes resulting from audit and normal year-end adjustments, and (b)
a narrative report describing the operations of Borrower and its Subsidiaries in
the form prepared for presentation to senior management for such Fiscal Quarter
and for the period from the beginning of the then current Fiscal Year to the end
of such Fiscal Quarter, containing a management discussion and analysis of
financial results; provided that delivery within the time period specified above
of copies of the Borrower's Quarterly Report on Form 10-Q prepared in compliance
with the requirements therefor and filed with the Securities and Exchange
Commission shall be deemed to satisfy the requirements of this clause to provide
consolidated financial statements and a narrative report;
(iii) Year-End Financials: as soon as available and in any event within 90 days
after the end of each Fiscal Year, (a) the consolidated balance sheet of
Borrower and its Subsidiaries as at the end of such Fiscal Year and the related
consolidated and consolidating statements of income, stockholders' equity and
cash flows of Borrower and its Subsidiaries for such Fiscal Year, setting forth
in each case in comparative form the corresponding figures for the previous
Fiscal Year and the corresponding figures from the Financial Plan for the Fiscal
Year covered by such financial statements, all in reasonable detail and
certified by the chief financial officer of Borrower that they fairly present,
in all material respects, the financial condition of Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, (b) a narrative report describing
the operations of Borrower and its Subsidiaries in the form prepared for
presentation to senior management for such Fiscal Year, (c) in the case of such
consolidated financial statements, a report thereon of a nationally recognized
"big 5" accounting firm or other independent certified public accountants of
recognized national standing selected by Borrower and satisfactory to
Administrative Agent, which report shall be unqualified, shall express no doubts
about the ability of Borrower and its Subsidiaries to continue as a going
concern, and shall state that such consolidated financial statements fairly
present, in all material respects, the consolidated financial position of
Borrower and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity with
GAAP applied on a basis consistent with prior years (except as otherwise
disclosed in such financial statements) and that the examination by such
accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards, and (d) an
updated Schedule 5.8 to this Agreement setting forth all of the data required to
be set forth in Schedule 5.8 annexed hereto with respect to any Material
Contracts entered into during such Fiscal Year; provided that the delivery
within the time period specified above of the Borrower's Annual Report on Form
10-K for such fiscal year (together with the Borrower's annual report to
shareholders, if any, prepared pursuant to Rule 14a-3 under the Exchange Act)
prepared in accordance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the requirements
of this clause to provide consolidated financial statements and a narrative
report, and (c) in the case of such consolidated financial statements, a report
thereon of a "Big 5" firm of independent certified public accountants of
recognized national standing selected by Borrower, which report shall be
unqualified, shall express no doubts about the ability of Borrower and its
Subsidiaries to continue as a going concern, and shall state that such
consolidated financial statements fairly present, in all material respects, the
consolidated financial position of Borrower and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years (except as otherwise disclosed in such financial statements) and
that the examination by such accountants in connection with such consolidated
financial statements has been made in accordance with generally accepted
auditing standards;
(iv) Officers' and Compliance Certificates: together with each delivery of
financial statements of Borrower and its Subsidiaries pursuant to subdivisions
(i), (ii) and (iii) above, (a) an Officers' Certificate of Borrower stating that
the signers have reviewed the terms of this Agreement and have made, or caused
to be made under their supervision, a review in reasonable detail of the
transactions and condition of Borrower and its Subsidiaries during the
accounting period covered by such financial statements and that such review has
not disclosed the existence during or at the end of such accounting period, and
that the signers do not have knowledge of the existence as at the date of such
Officers' Certificate, of any condition or event that constitutes an Event of
Default or Potential Event of Default, or, if any such condition or event
existed or exists, specifying the nature and period of existence thereof and
what action Borrower has taken, is taking and proposes to take with respect
thereto; and (b) a Compliance Certificate demonstrating in reasonable detail
compliance during and at the end of the applicable accounting periods with the
restrictions contained in Section 7, in each case to the extent compliance with
such restrictions is required to be tested at the end of the applicable
accounting period;
(v) Reconciliation Statements: if, as a result of any change in accounting
principles and policies from those used in the preparation of the audited
financial statements referred to in subsection 5.3 (other than an immaterial
change in GAAP), the consolidated financial statements of Borrower and its
Subsidiaries delivered pursuant to subdivisions (i), (ii), (iii) or (xi) of this
subsection 6.1 will differ in any material respect from the consolidated
financial statements that would have been delivered pursuant to such
subdivisions had no such change in accounting principles and policies been made,
then (a) together with the first delivery of financial statements pursuant to
subdivision (i), (ii), (iii) or (xi) of this subsection 6.1 following such
change, consolidated financial statements of Borrower and its Subsidiaries for
(y) the current Fiscal Year to the effective date of such change and (z) the two
full Fiscal Years immediately preceding the Fiscal Year in which such change is
made, in each case prepared on a pro forma basis as if such change had been in
effect during such periods, and (b) together with each delivery of financial
statements pursuant to subdivision (i), (ii), (iii) or (xi) of this subsection
6.1 following such change, if required pursuant to subsection 1.2, a written
statement of the chief accounting officer or chief financial officer of Borrower
setting forth the differences (including any differences that would affect any
calculations relating to the financial covenants set forth in subsection 7.6)
which would have resulted if such financial statements had been prepared without
giving effect to such change;
(vi) Accountants' Reports: promptly upon receipt thereof (unless restricted by
applicable professional standards), copies of all reports submitted to Borrower
by independent certified public accountants in connection with each annual,
interim or special audit of the financial statements of Borrower and its
Subsidiaries made by such accountants, including any comment letter submitted by
such accountants to management in connection with their annual audit;
(vii) Events of Default, etc.: promptly upon any officer of Borrower obtaining
knowledge (a) of any condition or event that constitutes an Event of Default or
Potential Event of Default, or becoming aware that any Lender has given any
notice (other than to Administrative Agent) or taken any other action with
respect to a claimed Event of Default or Potential Event of Default, (b) that
any Person has given any notice to Borrower or any of its Subsidiaries or taken
any other action with respect to a claimed default or event or condition of the
type referred to in subsection 8.2, (c) of any resignation or dismissal of
Borrower's independent accountant, (d) of any Change of Control or other event
requiring a prepayment of principal on the Senior Subordinated Notes or any
other Subordinated Indebtedness, (e) of any individual or series of related
Asset Sales aggregating in excess of $2,500,000, or (f) of the occurrence of any
event or change that has caused or evidences, either in any case or in the
aggregate, a Material Adverse Effect, an Officers' Certificate specifying the
nature and period of existence of such condition, event or change, or specifying
the notice given or action taken by any such Person and the nature of such
claimed Event of Default, Potential Event of Default, default, event or
condition, and what action Borrower has taken, is taking and proposes to take
with respect thereto;
(viii) Litigation or Other Proceedings: (a) promptly upon any officer of
Borrower obtaining knowledge of (X) the institution of, or (in the good faith
judgment of Borrower) non-frivolous threat of, any action, suit, proceeding
(whether administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Borrower or any of its Subsidiaries or any
property of Borrower or any of its Subsidiaries (collectively, "Proceedings")
not previously disclosed in writing by Borrower to Lenders or (Y) any material
development in any Proceeding that, in any case:
(1) if adversely determined, has a reasonable possibility
of giving rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the consummation
of, or to recover any damages or obtain relief as a
result of, the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Borrower to enable Lenders and their counsel to
evaluate such matters; and (b) within twenty days after the end of each
Fiscal Quarter, a schedule of all Proceedings involving an alleged
liability of, or claims against or affecting, Borrower or any of its
Subsidiaries equal to or greater than $500,000, and promptly after
request by Administrative Agent such other information as may be
reasonably requested by Administrative Agent to enable Administrative
Agent and its counsel to evaluate any of such Proceedings;
(ix) ERISA Events: promptly upon becoming aware of the occurrence of or
forthcoming occurrence of any ERISA Event, a written notice specifying
the nature thereof, what action Borrower, any of its Subsidiaries or
any of their respective ERISA Affiliates has taken, is taking or
proposes to take with respect thereto and, when known, any action taken
or threatened by the Internal Revenue Service, the Department of Labor
or the PBGC with respect thereto;
(x) ERISA Notices: with reasonable promptness, copies of (a) each Schedule
B (Actuarial Information) to the annual report (Form 5500 Series) filed
by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates with the Internal Revenue Service with respect to each
Pension Plan; (b) all notices received by Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (c) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Administrative Agent shall reasonably request;
(xi) Financial Plans: as soon as practicable and in any event no later
than 30 days after the beginning of each Fiscal Year, a consolidated
plan and financial forecast for such Fiscal Year (the "Financial Plan"
for such Fiscal Year), including (a) a forecasted consolidated balance
sheet and forecasted consolidated statements of income and cash flows
of Borrower and its Subsidiaries for such Fiscal Year, together with a
pro forma Compliance Certificate for such Fiscal Year and an
explanation of the assumptions on which such forecasts are based, (b)
a forecasted consolidated balance sheet and forecasted consolidated
statements of income and cash flows of Borrower and its Subsidiaries
for each month of such Fiscal Year, together with an explanation of
the assumptions on which such forecasts are based, and (c) such other
information and projections as any Lender may reasonably request;
(xii) Insurance: as soon as practicable and in any event by the last day of
each Fiscal Year, a report in form and substance satisfactory to
Administrative Agent outlining all material insurance coverage required
hereunder to be maintained as of the date of such report by Borrower
and its Subsidiaries and all material insurance coverage planned to be
maintained by Borrower and its Subsidiaries in the immediately
succeeding Fiscal Year as required hereunder;
(xiii) Corporate Matters: with reasonable promptness, written notice of (1)
any amendment of the articles or certificate of incorporation or
by-laws or other constituent documents of Borrower or any of its
Subsidiaries, (2) any change in the composition of the board of
directors of Borrower or any of its Subsidiaries, and (3) any change in
the executive officers of Borrower or any of its Subsidiaries;
(xiv) New Subsidiaries: promptly upon any Person becoming a Subsidiary of
Borrower, a written notice setting forth with respect to such Person
(a) the date on which such Person became a Subsidiary of Borrower and
(b) all of the data required to be set forth in Schedule 5.1 annexed
hereto with respect to all Subsidiaries of Borrower (it being
understood that such written notice shall be deemed to supplement
Schedule 5.1 annexed hereto for all purposes of this Agreement);
(xv) UCC Search Report: as promptly as practicable after the date of
delivery to Administrative Agent of any UCC financing statement
executed by any Loan Party pursuant to subsection 4.1J(iv) or 6.8A,
copies of completed UCC searches evidencing the proper filing,
recording and indexing of all such UCC financing statement and listing
all other effective financing statements that name such Loan Party as
debtor, together with copies of all such other financing statements not
previously delivered to Administrative Agent by or on behalf of
Borrower or such Loan Party;
(xvi) Margin Determination Certificate: commencing with the Fiscal Quarter
ended September 30, 2001, together with each delivery of financial
statements for each Fiscal Quarter (other than each fourth Fiscal
Quarter) pursuant to subdivision (ii) above, and within 45 days of the
last day of each fourth Fiscal Quarter, a Margin Determination
Certificate demonstrating in reasonable detail the calculation of the
Consolidated Total Leverage Ratio for the four consecutive Fiscal
Quarters ending on the day of the accounting period covered by such
financial statements;
(xvii) Deposit Accounts: promptly upon the opening of any Deposit Account by
Borrower or any of its Subsidiaries, a written notice setting forth all
of the data required to be set forth in Schedule 6.10 annexed hereto
with respect to such Deposit Account;
(xviii) Material Contracts: promptly, and in any event within ten Business Days
after any Material Contract of Borrower or any of its Subsidiaries is
terminated or amended in a manner that is materially adverse to
Borrower or such Subsidiary, as the case may be, or any new Material
Contract is entered into, a written statement describing such event
with copies of such material amendments or new contracts, and an
explanation of any actions being taken with respect thereto; and
(xix) Revisions or Updates to Schedules: should any of the information
or disclosures provided on any of the Schedules originally attached to
any of the Loan Documents become outdated or incorrect in any material
respect, as part of the next quarterly Officers' Certificate required
pursuant to subsection 6.1(iv), such revisions or updates to such
Schedules as may be necessary or appropriate to update or correct such
Schedules, provided that no such revisions or updates to any Schedules
shall be deemed to have amended, modified or superseded such Schedules
immediately prior to the submission of such revised or updated
Schedules, or to have cured any breach of warranty or representation
resulting from the inaccuracy or incompleteness of any such Schedules,
unless and until the Requisite Lenders in their sole and absolute
discretion, shall have accepted in writing such revisions or updates
to such Schedules; and
(xx) Other Information: with reasonable promptness, such other
information and data with respect to Borrower or any of its
Subsidiaries as from time to time may be reasonably requested by any
Lender.
6.2 Corporate Existence, etc.
Except as permitted under subsection 7.7, Borrower will, and will cause
each of its Subsidiaries to, at all times preserve and keep in full force and
effect its corporate existence and all rights and franchises material to its
business; provided, however that neither Borrower nor any of its Subsidiaries
shall be required to preserve any such right or franchise if the Board of
Directors of Borrower or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of Borrower or
such Subsidiary, as the case may be, and that the loss thereof is not
disadvantageous in any material respect to Borrower, such Subsidiary or Lenders.
6.3 Payment of Taxes and Claims; Tax Consolidation.
A. Borrower will, and will cause each of its Subsidiaries to, pay all taxes,
assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all claims (including claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a Lien upon any of its properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided that no such charge or claim need be paid if it is
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted, so long as (1) such reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor and (2) in the case of a charge or claim which has or may become a
Lien against any of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral to satisfy such charge
or claim.
B. Borrower will not, nor will it permit any of its Subsidiaries to, file or
consent to the filing of any consolidated income tax return with any Person
(other than Borrower or any of its Subsidiaries).
6.4 Maintenance of Properties; Insurance;
Application of Net Insurance/Condemnation Proceeds.
----------------------------------------------------
A. Maintenance of Properties. Borrower will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained in good repair, working
order and condition, ordinary wear and tear excepted, all material properties
used or useful in the business of Borrower and its Subsidiaries (including all
Intellectual Property) and from time to time will make or cause to be made all
appropriate repairs, renewals and replacements thereof.
B. Insurance. Borrower, at its sole cost and expense, will maintain or cause to
be maintained, with financially sound and reputable insurers, such public
liability insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to liabilities,
losses or damage in respect of the assets, properties and businesses of Borrower
and its Subsidiaries as may customarily be carried or maintained under similar
circumstances by corporations of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance), with
such deductibles, covering such risks and otherwise on such terms and conditions
as shall be customary for corporations similarly situated in the industry.
Without limiting the generality of the foregoing, Borrower will maintain or
cause to be maintained (i) flood insurance with respect to each Flood Hazard
Property that is located in a community that participates in the National Flood
Insurance Program, in each case in compliance with any applicable regulations of
the Board of Governors of the Federal Reserve System, and (ii) replacement value
casualty insurance on the Collateral under such policies of insurance, with such
insurance companies, in such amounts, with such deductibles, covering such
risks, and having other terms and conditions as are at all times satisfactory to
Administrative Agent in its commercially reasonable judgment. Each such policy
of insurance shall (a) name Administrative Agent for the benefit of Lenders as
an additional insured thereunder as its interests may appear and (b) in the case
of each business interruption and casualty insurance policy, contain a loss
payable clause or endorsement, satisfactory in form and substance to
Administrative Agent, that names Administrative Agent for the benefit of Lenders
as the loss payee thereunder for any covered loss in excess of $500,000 and
provides for at least 30 days prior written notice to Administrative Agent of
any modification or cancellation of such policy.
C. Application of Net Insurance/Condemnation Proceeds.
(i) Business Interruption Insurance. Upon receipt by Borrower or any of its
Subsidiaries of any business interruption insurance proceeds constituting Net
Insurance/Condemnation Proceeds, (a) so long as no Event of Default and no
Potential Event of Default shall have occurred and be continuing, Borrower or
such Subsidiary may retain and apply such Net Insurance/Condemnation Proceeds
for working capital purposes, and (b) if an Event of Default or a Potential
Event of Default shall have occurred and be continuing, Borrower shall apply an
amount equal to such Net Insurance/Condemnation Proceeds to prepay the Loans
(and/or the Revolving Loan Commitments shall be reduced) as provided in
subsection 2.4B(iii)(b);
(ii) Casualty Insurance/Condemnation Proceeds. Upon receipt by Borrower or any
of its Subsidiaries of any Net Insurance/Condemnation Proceeds other than from
business interruption insurance, (a) so long as no Event of Default and no
Potential Event of Default shall have occurred and be continuing, Borrower
shall, or shall cause one or more of its Subsidiaries to, promptly and
diligently apply all Net Insurance/Condemnation Proceeds in excess of $250,000
to pay or reimburse the costs of repairing, restoring or replacing the assets in
respect of which such Net Insurance/Condemnation Proceeds were received within
180 days after receipt of such Net Insurance/Condemnation Proceeds or, to the
extent not so applied within such 180 day period, to prepay the Loans (and/or
the Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b), and (b) if an Event of Default or a Potential Event of Default
shall have occurred and be continuing, Borrower shall apply an amount equal to
such Net Insurance/Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b).
(iii) Net Insurance/Condemnation Proceeds Received by Administrative Agent. Upon
actual receipt by Administrative Agent of any Net Insurance/Condemnation
Proceeds as loss payee, (a) if the aggregate amount of Net
Insurance/Condemnation Proceeds received (and reasonably expected to be
received) by Administrative Agent in respect of any covered loss exceeds
$500,000, or if and to the extent Borrower would have been required to apply
such Net Insurance/Condemnation Proceeds (if it had received them directly) to
prepay the Loans and/or reduce the Revolving Loan Commitments, Administrative
Agent shall, and Borrower hereby authorizes Administrative Agent to, apply such
Net Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving
Loan Commitments shall be reduced) as provided in subsection 2.4B(iii)(b), and
(b) to the extent the foregoing clause (a) does not apply, if the aggregate
amount of such Net Insurance/Condemnation Proceeds received (and reasonably
expected to be received) by Administrative Agent in respect of any covered loss
does not exceed $500,000, Administrative Agent shall deliver such Net
Insurance/Condemnation Proceeds to Borrower, and Borrower shall, or shall cause
one or more of its Subsidiaries to, promptly apply such Net
Insurance/Condemnation Proceeds to the costs of repairing, restoring, or
replacing the assets in respect of which such Net Insurance/Condemnation
Proceeds were received within 180 days after receipt of such Net
Insurance/Condemnation Proceeds or, to the extent not so applied within such 180
day period, to prepay the Loans (and/or the Revolving Loan Commitments shall be
reduced) as provided in subsection 2.4B(iii)(b); provided that if an Event of
Default or a Potential Event of Default shall have occurred and be continuing,
Administrative Agent shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving Loan
Commitments shall be reduced) as provided in subsection 2.4B(iii)(b).
6.5 Inspection Rights; Audits of Inventory and Accounts Receivable;
Lender Meeting.
---------------------------------------------------------------
A. Inspection Rights. Borrower shall, and shall cause each of its Subsidiaries
to, permit any authorized representatives designated by any Lender to visit and
inspect any of the properties of Borrower or of any of its Subsidiaries, to
inspect, copy and take extracts from its and their financial and accounting
records, and to discuss its and their affairs, finances and accounts with its
and their officers and independent public accountants (provided that Borrower
may, if it so chooses, be present at or participate in any such discussion), all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested. Lenders shall coordinate their
visits and inspections with those of Administrative Agent so as to minimize the
number of separate visits to Borrower's premises.
B. Audits of Inventory and Accounts Receivable. Borrower shall, and shall cause
each of its Subsidiaries to, permit any authorized representatives designated by
Administrative Agent to conduct up to two audits of all Inventory and accounts
receivable of Loan Parties during each twelve-month period after the Closing
Date, all upon reasonable notice and at such reasonable times during normal
business hours as may reasonably be requested; provided that upon the occurrence
and during the continuation of an Event of Default or a Potential Event of
Default, authorized representatives designated by Administrative Agent shall be
permitted to conduct additional audits of all such Inventory and accounts
receivable.
C. Lender Meeting. Borrower will, upon the request of Administrative Agent,
participate in a meeting of Administrative Agent and Lenders once during each
Fiscal Year to be held at Borrower's corporate offices (or at such other
location as may be agreed to by Borrower and Administrative Agent) at such time
as may be agreed to by Borrower and Administrative Agent.
6.6 Compliance with Laws, etc.
Borrower shall comply, and shall cause each of its Subsidiaries and all
other Persons on or occupying any Facilities to comply, with the requirements of
all applicable laws, rules, regulations and orders of any governmental authority
(including all Environmental Laws), noncompliance with which could reasonably be
expected to cause, individually or in the aggregate, a Material Adverse Effect.
6.7 Environmental Review and Investigation, Disclosure, Etc.;
Borrower's Actions Regarding Hazardous Materials Activities,
Environmental Claims and Violations of Environmental Laws.
--------------------------------------------------------------
A. Environmental Review and Investigation. Borrower agrees that Administrative
Agent may, from time to time and in its reasonable discretion, if (i)
Administrative Agent reasonably believes that Borrower has breached any
representation, warranty or covenant contained in subsection 5.6, 5.13, 6.6 or
6.7 or that there has been a material violation of Environmental Laws at any
Facility or by Borrower or any of its Subsidiaries at any other location or (ii)
an Event of Default has occurred and is continuing, retain, at Borrower's
expense, an independent professional consultant to review any environmental
audits, investigations, analyses and reports relating to Hazardous Materials
prepared by or for Borrower or conduct its own investigation of any Facility;
provided that, in the case of any Facility no longer owned, leased, operated or
used by Borrower or any of its Subsidiaries, Borrower shall only be obligated to
use its best efforts to obtain permission for Administrative Agent's
professional consultant to conduct an investigation of such Facility. For
purposes of conducting such a review and/or investigation, Borrower hereby
grants to Administrative Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Borrower or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be conducted,
unless otherwise agreed to by Borrower and Administrative Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at such Facility or to cause any
damage or loss to any property at such Facility. Borrower and Administrative
Agent hereby acknowledge and agree that any report of any investigation
conducted at the request of Administrative Agent pursuant to this subsection
6.7A will be obtained and shall be used by Administrative Agent and Lenders for
the purposes of Lenders' internal credit decisions, to monitor and police the
Loans and to protect Lenders' security interests, if any, created by the Loan
Documents. Administrative Agent agrees to deliver a copy of any such report to
Borrower with the understanding that Borrower acknowledges and agrees that (x)
it will indemnify and hold harmless Administrative Agent and each Lender from
any costs, losses or liabilities relating to Borrower's use of or reliance on
such report, (y) neither Administrative Agent nor any Lender makes any
representation or warranty with respect to such report, and (z) by delivering
such report to Borrower, neither Administrative Agent nor any Lender is
requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
B. Environmental Disclosure. Borrower will deliver to Administrative Agent and
Lenders:
(i) Environmental Audits and Reports. As soon as practicable following
receipt thereof, copies of all environmental audits, investigations,
analyses and reports of any kind or character, whether prepared by
personnel of Borrower or any of its Subsidiaries or by independent
consultants, governmental authorities or any other Persons, with respect to
significant environmental matters at any Facility which, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect or with respect to any Environmental Claims which, individually or
in the aggregate, could reasonably be expected to result in a Material
Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc. Promptly upon the
occurrence thereof, written notice describing in reasonable detail (a) any
Release required to be reported to any federal, state or local governmental
or regulatory agency under any applicable Environmental Laws which Release
could reasonably be expected to have a Material Adverse Effect, (b) any
remedial action taken by Borrower or any other Person in response to (1)
any Hazardous Materials Activities the existence of which has a reasonable
possibility of resulting in one or more Environmental Claims that could
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, or (2) any Environmental Claims that, individually
or in the aggregate, could reasonably be expected to have a Material
Adverse Effect.
(iii) Written Communications Regarding Environmental Claims, Releases, Etc.
As soon as practicable following the sending or receipt thereof by Borrower
or any of its Subsidiaries, a copy of any and all written communications
with respect to (a) any Environmental Claims that, individually or in the
aggregate, have a reasonable possibility of giving rise to a Material
Adverse Effect, (b) any Release required to be reported to any federal,
state or local governmental or regulatory agency, and (c) any request for
information from any governmental agency that suggests such agency is
investigating whether Borrower or any of its Subsidiaries may be
potentially responsible for any Hazardous Materials Activity.
(iv) Notice of Certain Proposed Actions Having Environmental Impact. Prompt
written notice describing in reasonable detail (a) any proposed acquisition
of stock, assets, or property by Borrower or any of its Subsidiaries that
could reasonably be expected to (1) expose Borrower or any of its
Subsidiaries to, or result in, Environmental Claims that could reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect or (2) affect the ability of Borrower or any of its Subsidiaries to
maintain in full force and effect all material Governmental Authorizations
required under any Environmental Laws for their respective operations and
(b) any proposed action to be taken by Borrower or any of its Subsidiaries
to modify current operations in a manner that could reasonably be expected
to subject Borrower or any of its Subsidiaries to any additional
obligations or requirements under any Environmental Laws that could
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(v) Phase I Environmental Reports. Within 90 days after the Closing Date, a
Phase I environmental assessment for each Facility (other than Facilities
listed on Schedule 4.1K and Leasehold Properties at which Borrower and its
Subsidiaries do not conduct any manufacturing activities), which shall (a)
substantially conform to the ASTM Standard Practice for Environmental Site
Assessments: Phase I Environmental Site Assessment Process, E 1527, (b) be
conducted by one or more environmental consulting firms reasonably
satisfactory to Administrative Agent, and (c) include a visual assessment
of suspect asbestos-containing materials at such Facilities, all to the
reasonable satisfaction of Administrative Agent.
(vi) Other Information. With reasonable promptness, such other documents
and information as from time to time may be reasonably requested by
Administrative Agent in relation to any matters disclosed pursuant to this
subsection 6.7.
C. Borrower's Actions Regarding Hazardous Materials Activities, Environmental
Claims and Violations of Environmental Laws.
(i) Remedial Actions Relating to Hazardous Materials Activities. Borrower
shall promptly undertake, and shall cause each of its Subsidiaries promptly
to undertake, any and all investigations, studies, sampling, testing,
abatement, cleanup, removal, remediation or other response actions
necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity on, under or about any Facility that is in violation of any
Environmental Laws or that presents a material risk of giving rise to an
Environmental Claim. In the event Borrower or any of its Subsidiaries
undertakes any such action with respect to any Hazardous Materials,
Borrower or such Subsidiary shall conduct and complete such action in
compliance with all applicable Environmental Laws and in accordance with
the policies, orders and directives of all federal, state and local
governmental authorities except when, and only to the extent that,
Borrower's or such Subsidiary's liability with respect to such Hazardous
Materials Activity is being diligently contested in good faith and by
appropriate proceedings by Borrower or such Subsidiary.
(ii) Actions with Respect to Environmental Claims and Violations of
Environmental Laws. Borrower shall promptly take, and shall cause each of
its Subsidiaries promptly to take, any and all actions necessary to (i)
cure any violation of applicable Environmental Laws by Borrower or its
Subsidiaries that could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect and (ii) make an appropriate
response to any Environmental Claim against Borrower or any of its
Subsidiaries and discharge any obligations it may have to any Person
thereunder where failure to do so could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
6.8 Execution of Subsidiary Guaranty and Personal Property
Collateral Documents by Certain Subsidiaries and Future Subsidiaries.
---------------------------------------------------------------------
A. Execution of Subsidiary Guaranty and Personal Property Collateral Documents.
If any Person organized under the laws of the United States or any State thereof
or the District of Columbia becomes a Subsidiary of Borrower after the date
hereof, Borrower will promptly notify Administrative Agent of that fact and
cause such Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty and the Security Agreement and to take
all such further actions and execute all such further documents and instruments
(including actions, documents and instruments comparable to those described in
subsection 4.1I and 4.1J) as may be necessary or, in the opinion of
Administrative Agent, desirable to create in favor of Administrative Agent, for
the benefit of Lenders, a valid First Priority Lien on all of the personal and
mixed property assets of such Subsidiary described in the applicable forms of
the Collateral Documents.
B. Subsidiary Charter Documents, Legal Opinions, Etc. Borrower shall deliver to
Administrative Agent, together with such Loan Documents, (i) certified copies of
such Subsidiary's Certificate or Articles of Incorporation, together with a good
standing certificate from the Secretary of State of the jurisdiction of its
incorporation and each other state in which such Person is qualified as a
foreign corporation to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any applicable
franchise or similar taxes from the appropriate taxing authority of each of such
jurisdictions, each to be dated a recent date prior to their delivery to
Administrative Agent, (ii) a copy of such Subsidiary's Bylaws, certified by its
corporate secretary or an assistant secretary as of a recent date prior to their
delivery to Administrative Agent, (iii) a certificate executed by the secretary
or an assistant secretary of such Subsidiary as to (a) the fact that the
attached resolutions of the Board of Directors of such Subsidiary approving and
authorizing the execution, delivery and performance of such Loan Documents are
in full force and effect and have not been modified or amended and (b) the
incumbency and signatures of the officers of such Subsidiary executing such Loan
Documents, and (iv) a favorable opinion of counsel to such Subsidiary, addressed
to Administrative Agent and Lenders, in form and substance satisfactory to
Administrative Agent and its counsel, as to (a) the due organization and good
standing of such Subsidiary, (b) the due authorization, execution and delivery
by such Subsidiary of such Loan Documents, (c) the enforceability of such Loan
Documents against such Subsidiary, (d) such other matters (including matters
relating to the creation and perfection of Liens in any Collateral pursuant to
such Loan Documents) as Administrative Agent may reasonably request, all of the
foregoing to be satisfactory in form and substance to Administrative Agent and
its counsel.
6.9 Conforming Leasehold Interests;
Matters Relating to Additional Real Property Collateral.
--------------------------------------------------------
A. Conforming Leasehold Interests. If Borrower or any of its Subsidiaries
acquires any Leasehold Property, Borrower shall, or shall cause such
Subsidiary to, cause such Leasehold Property to be a Conforming Leasehold
Interest.
B. Additional Mortgages, Etc. From and after the Closing Date, in the event
that (x) Borrower or any Subsidiary Guarantor acquires any fee interest in
real property or any Material Leasehold Property, or (y) at the time any
Person becomes a Subsidiary Guarantor, such Person owns or holds any fee
interest in real property or any Material Leasehold Property, in the case
of clause (y) above excluding any such Real Property Asset the
encumbrancing of which requires the consent of any applicable lessor or
then-existing senior lienholder, where Borrower and its Subsidiaries are
unable to obtain such lessor's or senior lienholder's consent after use of
commercially reasonable best efforts (any such non-excluded Real Property
Asset described in the foregoing clause (x) or (y) being an "Additional
Mortgaged Property"), Borrower or such Subsidiary Guarantor shall deliver
to Administrative Agent, as soon as practicable after such Person acquires
such Additional Mortgaged Property or becomes a Subsidiary Guarantor, as
the case may be, the following:
(i) Additional Mortgage. A fully executed and notarized Mortgage (an
"Additional Mortgage"), duly recorded in all appropriate places in all
applicable jurisdictions, encumbering the interest of such Loan Party in
such Additional Mortgaged Property;
(ii) Opinions of Counsel. (a) A favorable opinion of counsel to such Loan
Party, addressed to Administrative Agent and Lenders, in form and substance
satisfactory to Administrative Agent and its counsel, as to the due
authorization, execution and delivery by such Loan Party of such Additional
Mortgage and such other matters as Administrative Agent may reasonably
request, and (b) if required by Administrative Agent, an opinion of counsel
addressed to Administrative Agent and Lenders (which counsel shall be
reasonably satisfactory to Administrative Agent) in the state in which such
Additional Mortgaged Property is located with respect to the enforceability
of the form of Additional Mortgage recorded in such state and such other
matters (including any matters governed by the laws of such state regarding
personal property security interests in respect of any Collateral) as
Administrative Agent may reasonably request, in each case in form and
substance reasonably satisfactory to Administrative Agent;
(iii) Landlord Consent and Estoppel; Recorded Leasehold Interest. In the
case of an Additional Mortgaged Property consisting of a Leasehold
Property, (a) a Landlord Consent and Estoppel, unless Borrower or such
Subsidiary is unable to obtain the Landlord Consent and Estoppel after
using commercially reasonable best efforts to obtain the same, and (b)
evidence that such Leasehold Property is a Recorded Leasehold Interest;
(iv) Title Insurance. (a) If required by Administrative Agent, an ALTA
mortgagee title insurance policy or an unconditional commitment therefor
issued by the Title Company with respect to such Additional Mortgaged
Property, in an amount satisfactory to Administrative Agent, insuring fee
simple title to, or a valid leasehold interest in, such Additional
Mortgaged Property vested in such Loan Party and assuring Administrative
Agent that such Additional Mortgage creates a valid and enforceable First
Priority mortgage Lien on such Additional Mortgaged Property, subject only
to a standard survey exception, which policy (1) shall include an
endorsement for mechanics' liens, for future advances under this Agreement
and for any other matters reasonably requested by Administrative Agent and
(2) shall provide for affirmative insurance and such reinsurance as
Administrative Agent may reasonably request, all of the foregoing in form
and substance reasonably satisfactory to Administrative Agent; and (b)
evidence satisfactory to Administrative Agent that such Loan Party has (i)
delivered to the Title Company all certificates and affidavits required by
the Title Company in connection with the issuance of such policy and (ii)
paid to the Title Company or to the appropriate governmental authorities
all expenses and premiums of the Title Company in connection with the
issuance of such policy and all recording and stamp taxes (including
mortgage recording and intangible taxes) payable in connection with
recording the Additional Mortgage in the appropriate real estate records;
(v) Title Report. If no title insurance policy is required with respect to
such Additional Mortgaged Property, a title report issued by the Title
Company with respect thereto, dated not more than 30 days prior to the date
such Additional Mortgage is to be recorded and satisfactory in form and
substance to Administrative Agent;
(vi) Copies of Documents Relating to Title Exceptions. Copies of all
recorded documents listed as exceptions to title or otherwise referred to
in the additional title insurance policy or title report delivered pursuant
to clause (iv) or (v) above;
(vii) Matters Relating to Flood Hazard Properties. (a) Evidence, which may
be in the form of a letter from an insurance broker or a municipal
engineer, as to (1) whether such Additional Mortgaged Property is a Flood
Hazard Property and (2) if so, whether the community in which such Flood
Hazard Property is located is participating in the National Flood Insurance
Program, (b) if such Additional Mortgaged Property is a Flood Hazard
Property, such Loan Party's written acknowledgement of receipt of written
notification from Administrative Agent (1) that such Additional Mortgaged
Property is a Flood Hazard Property and (2) as to whether the community in
which such Flood Hazard Property is located is participating in the
National Flood Insurance Program, and (c) in the event such Additional
Mortgaged Property is a Flood Hazard Property that is located in a
community that participates in the National Flood Insurance Program,
evidence that Borrower has obtained flood insurance in respect of such
Flood Hazard Property to the extent required under the applicable
regulations of the Board of Governors of the Federal Reserve System; and
(viii) Environmental Audit. If required by Administrative Agent, reports
and other information, in form, scope and substance satisfactory to
Administrative Agent and prepared by environmental consultants satisfactory
to Administrative Agent, concerning any environmental hazards or
liabilities to which Borrower or any of its Subsidiaries may be subject
with respect to such Additional Mortgaged Property.
6.10 Deposit Accounts and Cash Management Systems.
Borrower shall, and shall cause each of its Subsidiaries to, use and
maintain its Deposit Accounts and cash management systems in a manner reasonably
satisfactory to Administrative Agent. Information regarding these Deposit
Accounts, including (a) the name and address of the financial institutions
maintaining the Deposit Accounts, and (b) the Deposit Account numbers, shall be
set forth on Schedule 6.10 annexed hereto. Borrower shall not permit any Deposit
Accounts at any time to have a principal balance in excess of $100,000 unless
Borrower or such Subsidiary, as the case may be, has (i) delivered to
Administrative Agent an agreement, satisfactory in form and substance to
Administrative Agent and executed by the financial institution at which such
Deposit Account is maintained, pursuant to which such financial institution
confirms and acknowledges Administrative Agent's security interest in, and sole
dominion and control over, such Deposit Account and waives its rights to set-off
with respect to amounts in such Deposit Account, and (ii) taken all other steps
necessary or, in the opinion of Administrative Agent, desirable to ensure that
Administrative Agent will have sole dominion and control over such Deposit
Account at all times while such agreement is in effect; provided that if
Borrower or such Subsidiary is unable to obtain such agreement from such
financial institution Borrower shall, or shall cause such Subsidiary to, within
30 days after receiving a written request by Administrative Agent to do so,
transfer all amounts in the applicable Deposit Account to a Deposit Account
maintained at a financial institution from which Borrower or such Subsidiary has
obtained such an agreement.
6.11 Interest Rate Cap.
At all times after the date that is 90 days after the Closing Date,
Borrower shall maintain in effect one or more Interest Rate Agreements with
respect to the Term Loans, in an aggregate notional principal amount of at least
$82,500,000, which Interest Rate Agreements shall have the effect of
establishing a maximum interest rate of not more than 12% per annum with respect
to such notional principal amount, each such Interest Rate Agreement to be in
form and substance reasonably satisfactory to Administrative Agent and with a
term of not less than three years after the Closing Date.
6.12 Assignment of Claims Act.
Upon the request of Administrative Agent made at any time when
government contracts are material to Borrower's or any of its Subsidiary's
business, Borrower shall, and shall cause each applicable Subsidiary to, execute
any documents or instruments and take such steps or actions reasonably required
by Administrative Agent so that all monies due or to become due under any
contract within the United States of America, the District of Columbia or any
state, county, municipality or other domestic or foreign governmental entity, or
any department, agency or instrumentality thereof, will be assigned to
Administrative Agent, for the benefit of itself and the Lenders, and notice
given thereof in accordance with the requirements of the Assignment of Claims
Act of 1940, as amended, or any other laws, rules or regulations relating to the
assignment of any such contract and monies due or to become due.
6.13 Landlord Consents and Estoppels; Recorded Leasehold Interests.
In the case of each Leasehold Property, Borrower shall, and shall cause
each applicable Subsidiary to, use its commercially reasonable best efforts to
obtain and deliver (a) a fully executed Landlord Consent and Estoppel with
respect thereto, and (b) evidence that such Leasehold Property is a Recorded
Leasehold Interest.
6.14 Other Post-Closing Matters.
Notwithstanding the provisions of subsection 4.1 or the other
provisions of this Section 6, Borrower shall, and shall cause each of its
Subsidiaries to, comply with each of the affirmative covenants set forth in
Schedule 6.14 attached hereto during the applicable period set forth therein.
Section 7. BORROWER'S NEGATIVE COVENANTS
Borrower covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Borrower shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 7.
7.1 Indebtedness.
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
(i) Borrower may become and remain liable with respect to the Obligations;
(ii) Borrower and its Subsidiaries may become and remain liable with respect
to Contingent Obligations permitted by subsection 7.4 and, upon any
matured obligations actually arising pursuant thereto, the Indebtedness
corresponding to the Contingent Obligations so extinguished;
(iii) Borrower and its Subsidiaries may become and remain liable with respect
to Indebtedness in respect of Capital Leases; provided that such
Capital Leases are permitted under the terms of subsection 7.9;
(iv) Borrower may become and remain liable with respect to
Indebtedness to any of its wholly-owned domestic Subsidiaries, and any
wholly-owned domestic Subsidiary of Borrower may become and remain
liable with respect to Indebtedness to Borrower or any other
wholly-owned, domestic Subsidiary of Borrower; provided that (a) all
such intercompany Indebtedness shall be evidenced by promissory notes,
(b) all such intercompany Indebtedness owed by Borrower to any of its
Subsidiaries shall be subordinated in right of payment to the payment
in full of the Obligations pursuant to the terms of the applicable
promissory notes or an intercompany subordination agreement, and (c)
any payment by any Subsidiary of Borrower under any guaranty of the
Obligations shall result in a pro tanto reduction of the amount of any
intercompany Indebtedness owed by such Subsidiary to Borrower or to
any of its Subsidiaries for whose benefit such payment is made; and
(v) Borrower and its Subsidiaries may become and remain liable with respect
to other unsecured Indebtedness in an aggregate principal amount not to
exceed $10,000,000 at any time outstanding.
7.2 Liens and Related Matters.
A. Prohibition on Liens. Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Borrower or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom or proceeds thereof, or
file or permit the filing of, or permit to remain in effect, any financing
statement or other similar notice of any Lien with respect to any such property,
asset, income or profits or proceeds under the UCC of any State or under any
similar recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents; and
(iii) Liens described in Schedule 7.2 annexed hereto.
------------
B. Equitable Lien in Favor of Lenders. If Borrower or any of its Subsidiaries
shall create or assume any Lien upon any of its properties or assets, whether
now owned or hereafter acquired, other than Liens excepted by the provisions of
subsection 7.2A, it shall make or cause to be made effective provision whereby
the Obligations will be secured by such Lien equally and ratably with any and
all other Indebtedness secured thereby as long as any such Indebtedness shall be
so secured; provided that, notwithstanding the foregoing, this covenant shall
not be construed as a consent by Requisite Lenders to the creation or assumption
of any such Lien not permitted by the provisions of subsection 7.2A.
C. No Further Negative Pledges. Except with respect to specific property
encumbered to secure payment of particular Indebtedness or to be sold pursuant
to an executed agreement with respect to an Asset Sale permitted by the terms
hereof, neither Borrower nor any of its Subsidiaries shall enter into any
agreement prohibiting the creation or assumption of any Lien upon any of its
properties or assets, whether now owned or hereafter acquired.
D. No Restrictions on Subsidiary Distributions to Borrower or Other
Subsidiaries. Except as provided herein, Borrower will not, and will not permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Borrower or any
other Subsidiary of Borrower, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Borrower or any other Subsidiary of Borrower, (iii) make loans or
advances to Borrower or any other Subsidiary of Borrower, or (iv) transfer any
of its property or assets to Borrower or any other Subsidiary of Borrower.
7.3 Investments; Joint Ventures.
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, including any
Joint Venture, except:
(i) Borrower and its Subsidiaries may make and own Investments in
Cash and Cash Equivalents;
(ii) Borrower and its Subsidiaries may (a) make and own Investments in any
Loan Party, and (b) make and own Investments in any Subsidiaries of
Borrower that are not Loan Parties in aggregate amount not to exceed
$750,000;
(iii) Borrower and its Subsidiaries may make intercompany loans to the extent
permitted under subsection 7.1(iv);
(iv) Borrower and its Subsidiaries may make Consolidated Capital
Expenditures permitted by subsection 7.8;
(v) Borrower and its Subsidiaries may continue to own the Investments
owned by them as of the Closing Date and described in Schedule 7.3
annexed hereto;
(vi) Borrower and its Subsidiaries may make and own Investments in shares of
capital stock, evidence of Indebtedness or other security acquired in
consideration for or as evidence of past-due or restructured Accounts
in an aggregate face amount of such Accounts at any time not to exceed
$500,000;
(vii) Borrower and its Subsidiaries may make and own Investments in non-cash
consideration received in connection with any Asset Sale otherwise
permitted hereby;
(viii) Borrower and its Subsidiaries may make and own Investments with respect
to any obligation to indemnify their respective officers and directors
to the fullest extent permitted by the corporation or limited liability
company law of the jurisdiction of such Person's organization;
(ix) Borrower and its Subsidiaries may make and own Investments in loans and
advances (a) to their respective employees for moving, entertainment,
travel and other similar expenses in the ordinary course of business
not to exceed $250,000 in the aggregate at any time outstanding, or (b)
to their respective employees and to their respective independent sales
representatives secured by the pledge of shares of Borrower Common
Stock made to finance the purchase by such employees (or
representatives) of such stock, not to exceed $1,000,000 in the
aggregate at any time outstanding;
(x) Borrower and its Subsidiaries may make acquisitions permitted pursuant
to subsection 7.7; and
(xi) Borrower and its Subsidiaries may sell inventory on credit in the
ordinary course of business.
7.4 Contingent Obligations.
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Borrower may become and remain liable with respect to Contingent
Obligations in respect of Letters of Credit issued under this Agreement
and Subsidiaries of Borrower may become and remain liable with respect
to Contingent Obligations in respect of the Subsidiary Guaranty;
(ii) Borrower and its Subsidiaries may become and remain liable with respect
to other Contingent Obligations (including letters of credit) in an
aggregate amount not to exceed $750,000 at any time;
(iii) Borrower and its Subsidiaries may become and remain liable with respect
to Contingent Obligations under the Related Agreements or otherwise in
respect of customary indemnification and purchase price adjustment
obligations incurred in connection with (x) Asset Sales or other sales
of assets permitted by the terms hereof, and (y) acquisitions permitted
under this Agreement;
(iv) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of any Indebtedness of
Borrower or any of its Subsidiaries permitted by subsection 7.1;
(v) Borrower and its Subsidiaries, as applicable, may remain liable
with respect to Contingent Obligations described in Schedule 7.4
annexed hereto;
(vi) Borrower and its Subsidiaries may become and remain liable with respect
to Contingent Obligations incurred in the ordinary course of business
with respect to surety and appeal bonds, performance bonds and other
similar obligations;
(vii) Borrower and its Subsidiaries may become and remain liable with respect
to Contingent Obligations incurred in the ordinary course of business
under indemnity agreements to title insurers to cause such title
insurers to issue title insurance policies to Administrative Agent
and/or to Borrower or any of its Subsidiaries pursuant to the terms
hereof; and
(viii) Borrower and its Subsidiaries may become and remain liable with respect
to Contingent Obligations incurred in the ordinary course of business
(consistent with past practices) under Currency Agreements in an
aggregate amount not to exceed $12,000,000 outstanding at any time.
7.5 Restricted Junior Payments
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Junior Payment; provided, however, that:
(i) Borrower may make Restricted Junior Payments to redeem shares of its
capital stock or warrants or options to acquire any such shares from
employees of Borrower and its Subsidiaries upon the death or other
termination of employment of such employees, provided that all of the
following conditions are satisfied:
(a) no Potential Event of Default or Event of Default shall have
occurred and be continuing or would arise as a result of such
Restricted Junior Payment;
(b) after giving effect to such Restricted Junior Payment
(together with all prior or concurrent Restricted Junior
Payments permitted under this subsection 7.5(i)(b)), Borrower
shall be in compliance on a pro forma basis with the covenants
set forth in subsection 7.6, recomputed for the most recent
month for which financial statements have been delivered by
Borrower pursuant to subsection 6.1; and
(c) the aggregate amount of such Restricted Junior Payments permitted
in any Fiscal Year of Borrower shall not exceed $1,500,000;
(ii) Borrower may make regularly scheduled payments of interest in
respect of the Senior Subordinated Notes, in accordance with the terms
of and to the extent required by, and subject to the subordination
provisions contained in, the Subordinated Note Indenture; provided
that (a) no Potential Event of Default or Event of Default shall have
occurred and be continuing or would arise as a result of such
Restricted Junior Payment, and (b) after giving effect to such
Restricted Junior Payment (together with all prior or concurrent
Restricted Junior Payments permitted under this subsection 7.5(ii)),
Borrower shall be in compliance on a pro forma basis with the
covenants set forth in subsection 7.6, recomputed for the most recent
month for which financial statements have been delivered by Borrower
pursuant to subsection 6.1; and
(iii) Borrower may make Restricted Junior Payments during the one-week period
immediately following the Closing Date in connection with the
termination of certain employees of BJI, provided that the aggregate
amount of such Restricted Junior Payments shall not exceed $230,000.
7.6 Financial Covenants.
A. Maximum Consolidated Total Leverage Ratio. Borrower shall not permit the
Consolidated Total Leverage Ratio as of the last day of any Fiscal Quarter set
forth below to exceed the correlative ratio indicated below:
Period Maximum Consolidated Total Leverage Ratio
2nd Fiscal Quarter, Fiscal Year 2001 4.50:1.00
3rd Fiscal Quarter, Fiscal Year 2001 4.50:1.00
4th Fiscal Quarter, Fiscal Year 2001 4.50:1.00
1st Fiscal Quarter, Fiscal Year 2002 4.50:1.00
2nd Fiscal Quarter, Fiscal Year 2002 4.25:1.00
3rd Fiscal Quarter, Fiscal Year 2002 4.25:1.00
4th Fiscal Quarter, Fiscal Year 2002 4.25:1.00
1st Fiscal Quarter, Fiscal Year 2003 4.25:1.00
2nd Fiscal Quarter, Fiscal Year 2003 4.00:1.00
3rd Fiscal Quarter, Fiscal Year 2003 4.00:1.00
4th Fiscal Quarter, Fiscal Year 2003 3.75:1.00
1st Fiscal Quarter, Fiscal Year 2004 3.75:1.00
2nd Fiscal Quarter, Fiscal Year 2004 3.75:1.00
3rd Fiscal Quarter, Fiscal Year 2004 3.75:1.00
4th Fiscal Quarter, Fiscal Year 2004 3.50:1.00
1st Fiscal Quarter, Fiscal Year 2005 3.25:1.00
and each Fiscal Quarter thereafter
B. Maximum Consolidated Senior Leverage Ratio. Borrower shall not permit the
Consolidated Senior Leverage Ratio as of the last day of any Fiscal Quarter set
forth below to exceed the correlative ratio indicated below:
Maximum Consolidated Senior Leverage
Period Ratio
2nd Fiscal Quarter, Fiscal Year 2001 3.50:1.00
3rd Fiscal Quarter, Fiscal Year 2001 3.50:1.00
4th Fiscal Quarter, Fiscal Year 2001 3.50:1.00
1st Fiscal Quarter, Fiscal Year 2002 3.50:1.00
2nd Fiscal Quarter, Fiscal Year 2002 3.25:1.00
3rd Fiscal Quarter, Fiscal Year 2002 3.25:1.00
4th Fiscal Quarter, Fiscal Year 2002 3.25:1.00
1st Fiscal Quarter, Fiscal Year 2003 3.25:1.00
2nd Fiscal Quarter, Fiscal Year 2003 3.00:1.00
3rd Fiscal Quarter, Fiscal Year 2003 3.00:1.00
4th Fiscal Quarter, Fiscal Year 2003 3.00:1.00
1st Fiscal Quarter, Fiscal Year 2004
and each Fiscal Quarter thereafter 2.50:1.00
C. Minimum Interest Coverage Ratio. Borrower shall not permit the ratio of (i)
Consolidated EBITDA to (ii) Consolidated Interest Expense for any four
consecutive Fiscal Quarter period ending during any of the periods set forth
below to be less than the correlative ratio indicated:
Period Minimum Interest Coverage Ratio
------ ---------------
2nd Fiscal Quarter, Fiscal Year 2001 1.85:1.00
3rd Fiscal Quarter, Fiscal Year 2001 1.85:1.00
4th Fiscal Quarter, Fiscal Year 2001 1.85:1.00
1st Fiscal Quarter, Fiscal Year 2002 1.85:1.00
2nd Fiscal Quarter, Fiscal Year 2002 1.95:1.00
3rd Fiscal Quarter, Fiscal Year 2002 1.95:1.00
4th Fiscal Quarter, Fiscal Year 2002 1.95:1.00
1st Fiscal Quarter, Fiscal Year 2003 1.95:1.00
2nd Fiscal Quarter, Fiscal Year 2003 2.00:1.00
3rd Fiscal Quarter, Fiscal Year 2003 2.00:1.00
4th Fiscal Quarter, Fiscal Year 2003 2.00:1.00
1st Fiscal Quarter, Fiscal Year 2004 2.00:1.00
2nd Fiscal Quarter, Fiscal Year 2004
and each Fiscal Quarter thereafter 2.25:1.00
D. Minimum Fixed Charge Coverage Ratio. Borrower shall not permit the ratio of
(i) Consolidated EBITDA minus Consolidated Capital Expenditures to (ii)
Consolidated Fixed Charges for any four consecutive Fiscal Quarter period ending
on the last day of any Fiscal Quarter set forth below to be less than the
correlative ratio indicated:
Period Minimum Fixed Charge Coverage Ratio
------ --------------
2nd Fiscal Quarter, Fiscal Year 2001 1.15:1.00
3rd Fiscal Quarter, Fiscal Year 2001 1.15:1.00
4th Fiscal Quarter, Fiscal Year 2001 1.15:1.00
1st Fiscal Quarter, Fiscal Year 2002 1.15:1.00
2nd Fiscal Quarter, Fiscal Year 2002 1.15:1.00
3rd Fiscal Quarter, Fiscal Year 2002 1.15:1.00
4th Fiscal Quarter, Fiscal Year 2002 1.15:1.00
1st Fiscal Quarter, Fiscal Year 2003 1.20:1.00
2nd Fiscal Quarter, Fiscal Year 2003 1.20:1.00
3rd Fiscal Quarter, Fiscal Year 2003 1.20:1.00
4th Fiscal Quarter, Fiscal Year 2003 1.20:1.00
1st Fiscal Quarter, Fiscal Year 2004 1.20:1.00
2nd Fiscal Quarter, Fiscal Year 2004
and each Fiscal Quarter thereafter 1.25:1.00
E. Minimum Consolidated Net Worth. Borrower shall not permit Consolidated Net
Worth as of the last day of any given Fiscal Quarter in any given Fiscal Year to
be less than the sum of (a) 90% of the Consolidated Net Worth of Borrower as of
the Closing Date, plus (b) 100% of the net proceeds of any issuances of capital
stock of Borrower or any of its Subsidiaries after the Closing Date, plus (c)
75% of the positive amounts of Consolidated Net Income for each Fiscal Quarter
ending after the Closing Date.
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions.
Borrower shall not, and shall not permit any of its Subsidiaries to,
alter the corporate, capital or legal structure of Borrower or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person (other than purchases or other acquisitions of Inventory,
materials and equipment in the ordinary course of Borrower's, or any of its
Subsidiary's, business), except:
(i) any Subsidiary of Borrower may be merged with or into Borrower or any
Subsidiary Guarantor that is wholly owned, directly or indirectly, by
Borrower, or be liquidated, wound up or dissolved, or all or any part of
its business, property or assets may be conveyed, sold, leased, transferred
or otherwise disposed of, in one transaction or a series of transactions,
to Borrower or any Subsidiary Guarantor that is wholly owned, directly or
indirectly, by Borrower; provided that (a) in the case of such a merger,
Borrower or a Subsidiary Guarantor that is wholly owned, directly or
indirectly, by Borrower shall be the continuing or surviving corporation,
and (b) in the case of such a liquidation, winding up or dissolution, all
of the assets of such Subsidiary are transferred to Borrower or a
Subsidiary Guarantor that is wholly owned, directly or indirectly, by
Borrower or as otherwise expressly permitted under this Agreement; and
provided, further, that Xxxxx Xxxxxx Company shall not be permitted to
assign, whether by asset sale, merger or otherwise, the Asset Purchase
Agreement dated as of June 1, 1989 by and among Xxxx Furniture, Inc.
("Xxxx"), Maytag Corporation, The BJC Company and The Gunlocke Company or
the Assignment and Assumption Agreement dated as of July 7, 1989 by and
between Xxxx and certain of its subsidiaries (including Xxxxx Xxxxxx
Company) or any of the rights or liabilities thereunder to any other Person
without the prior written consent of Xxxx;
(ii) Borrower and its Subsidiaries may make Consolidated Capital
Expenditures permitted under subsection 7.8;
(iii) Borrower and its Subsidiaries may dispose of obsolete, worn out or
surplus property in the ordinary course of business;
(iv) Borrower and its Subsidiaries may sell or otherwise dispose of assets
in transactions that do not constitute Asset Sales; provided that the
consideration received for such assets shall be in an amount at least equal
to the fair market value thereof;
(v) Borrower and its Subsidiaries may sell or discount, in each case
without recourse and in the ordinary course of business, Accounts arising
in the ordinary course of business, but only in connection with the
compromise or collection thereof and not as part of any financing
transaction, but only to the extent permitted under the Security Agreement;
(vi) Borrower and its Subsidiaries may grant leases and subleases to other
Persons in the ordinary course of business not materially interfering with
the conduct of the business of Borrower or any of its Subsidiaries; and
(vii) Borrower may consummate the Acquisition.
7.8 Consolidated Capital Expenditures.
Borrower shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Capital Expenditures in any Fiscal Year in an aggregate
amount in excess of $7,500,000.
7.9 Restriction on Leases.
Borrower shall not, and shall not permit any of its Subsidiaries to,
become liable in any way, whether directly or by assignment or as a guarantor or
other surety, for the obligations of the lessee under any lease, whether an
Operating Lease or a Capital Lease (other than intercompany leases between
Borrower and its wholly-owned domestic Subsidiaries), unless, immediately after
giving effect to the incurrence of liability with respect to such lease, the
aggregate amount of all rental payments under all such leases shall not exceed
$5,000,000 in any Fiscal Year.
7.10 Sales and Lease-Backs.
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any lease, whether an Operating Lease or a Capital
Lease, of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (i) which Borrower or any of its Subsidiaries has sold or
transferred or is to sell or transfer to any other Person (other than Borrower
or any of its Subsidiaries, as permitted by subsection 7.7 hereof) or (ii) which
Borrower or any of its Subsidiaries intends to use for substantially the same
purpose as any other property which has been or is to be sold or transferred by
Borrower or any of its Subsidiaries to any Person (other than Borrower or any of
its Subsidiaries, as permitted by subsection 7.7 hereof) in connection with such
lease; provided that Borrower and its Subsidiaries may become and remain liable
as lessee, guarantor or other surety with respect to any such lease if and to
the extent that Borrower or any of its Subsidiaries would be permitted to enter
into, and remain liable under, such lease under subsection 7.9.
7.11 Sale or Discount of Receivables.
Except for sales permitted pursuant to subsection 7.7(v), Borrower
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, sell with recourse, or discount or otherwise sell for less than the
face value thereof, any of its notes or accounts receivable.
7.12 Transactions with Shareholders and Affiliates.
Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder of 5% or more of any class of equity Securities of
Borrower or with any Affiliate of Borrower or of any such holder, on terms that
are less favorable to Borrower or that Subsidiary, as the case may be, than
those that might be obtained at the time from Persons who are not such a holder
or Affiliate; provided that the foregoing restriction shall not apply to (i) any
transaction between Borrower and any Subsidiary Guarantor or between Subsidiary
Guarantors; (ii) reasonable and customary fees paid to members of the Boards of
Directors of Borrower and its Subsidiaries in an aggregate amount not to exceed
$100,000 during any period of twelve consecutive months; (iii) payment to
Trivest of a transaction fee not to exceed $1,400,000 in connection with the
consummation of the Acquisition; (iv) payments made to Trivest in accordance
with the provisions of the Trivest Management Agreement; provided that amounts
payable under the Trivest Management Agreement shall not be (a) increased from
amounts payable under the Trivest Management Agreement as in effect on the
Closing Date (other than annual adjustments not to exceed $750,000 to reflect
(1) any increase in the Consumer Price Index for all urban consumers, or (2)
acquisitions consummated after the Closing Date in compliance with the
provisions of subsection 7.7), or (b) payable upon the occurrence and during the
continuation of a Potential Event of Default or an Event of Default; (v)
payments to Trivest to enable the payment of out-of-pocket expenses of members
of the board of directors of Trivest who are not otherwise employees or
consultants to Trivest or any of its Subsidiaries or any of their respective
Affiliates, provided that the aggregate amount of such fees shall not exceed
$250,000 during any period of twelve consecutive months; (vi) Restricted Junior
Payments expressly permitted pursuant to clause (i) or clause (iii) of
subsection 7.5; and (vii) any transaction between Borrower and any of its
Subsidiaries (other than a Subsidiary Guarantor) or between any such
Subsidiaries that is in the ordinary course of business of such Person and
consistent with its past business practices. Notwithstanding any provision of
this Agreement to the contrary, Borrower or any of its Subsidiaries may
reimburse Trivest for the allocable charges (including the reimbursement of
reasonable out-of-pocket expenses) of the Trivest Legal Department for services
rendered to Borrower and its Subsidiaries, provided that such charges are
incurred in the ordinary course of business and at rates no less favorable to
Borrower and its Subsidiaries than rates that would be charged for similar
services rendered by Persons who are not Affiliates of Borrower or its
Subsidiaries.
7.13 Disposal of Subsidiary Stock.
Except for any sale of 100% of the capital stock or other equity
Securities of any of its Subsidiaries in compliance with the provisions of
subsection 7.7, Borrower shall not:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other
equity Securities of any of its Subsidiaries, except to
qualify directors if required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any
shares of capital stock or other equity Securities of any of
its Subsidiaries (including such Subsidiary), except to
Borrower, another wholly-owned domestic Subsidiary of
Borrower, or to qualify directors if required by applicable
law.
7.14 Conduct of Business.
From and after the Closing Date, Borrower shall not, and shall not
permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Borrower and its Subsidiaries on the Closing Date and
similar or related businesses, and (ii) such other lines of business as may be
consented to by Requisite Lenders.
7.15 Amendments or Waivers of Related Agreements.
Unless the prior written consent of Requisite Lenders is obtained,
neither Borrower nor any of its Subsidiaries will (i) agree to any material
amendment to, or waive any of its material rights under, any Related Agreement
in any manner that is, in the reasonable opinion of Administrative Agent,
adverse to Administrative Agent or the Lenders, (ii) incur any additional
material obligations or increase any payment obligations under any Related
Agreement after the Closing Date, or (iii) agree to any amendment to any Senior
Subordinated Note Document.
7.16 Fiscal Year.
Borrower shall not change its Fiscal Year-end from December 31.
7.17 Pompeii Mexico.
At any time at which less than 65% of the capital stock of Pompeii
Mexico is pledged as Collateral under the Security Agreement, Borrower shall not
permit Pompeii Mexico to (i) have revenues in excess of $10,000, or (ii) own
assets with an aggregate fair market value in excess of $10,000.
Section 8. EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default")
shall occur:
8.1 Failure to Make Payments When Due.
Failure by Borrower to pay any installment of principal of any Loan
when due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Borrower to pay
when due any amount payable to an Issuing Lender in reimbursement of any drawing
under a Letter of Credit; failure by Borrower to pay any interest on any Loan
when due; or failure by Borrower to pay any fee or any other amount due under
this Agreement within ten days after the date due; or
8.2 Default in Other Agreements.
(i) Failure of Holdings or any of its Subsidiaries to pay when due any
principal of or interest on or any other amount payable in respect of one or
more items of Indebtedness (other than Indebtedness referred to in subsection
8.1) or Contingent Obligations having an aggregate principal amount (including
undrawn committed or available amounts and including amounts owing to all
creditors under any combined or syndicated credit agreement) of more than
$1,000,000 individually or $2,500,000 in the aggregate, in each case beyond the
end of any grace period provided therefor; or (ii) breach or default by Holdings
or any of its Subsidiaries with respect to any other material term of (a) one or
more items of Indebtedness or Contingent Obligations in the individual or
aggregate principal amounts referred to in clause (i) above or (b) any loan
agreement, mortgage, indenture or other agreement relating to such item(s) of
Indebtedness or Contingent Obligation(s), if the effect of such breach or
default is to cause, or to permit the holder or holders of that Indebtedness or
Contingent Obligation(s) (or a trustee on behalf of such holder or holders) to
cause, that Indebtedness or Contingent Obligation(s) to become or be declared
due and payable prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be (upon the giving or receiving of
notice, lapse of time, both, or otherwise); or
8.3 Breach of Certain Covenants.
Failure of Borrower to perform or comply with any term or condition
contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or
8.4 Breach of Warranty.
Any representation, warranty, certification or other statement made by
Holdings or any of its Subsidiaries in any Loan Document or in any statement or
certificate at any time given by Holdings or any of its Subsidiaries in writing
pursuant hereto or thereto or in connection herewith or therewith shall be false
in any material respect on the date as of which made; or
8.5 Other Defaults Under Loan Documents.
Any Loan Party shall default in the performance of or compliance with
any term contained in this Agreement or any of the other Loan Documents, other
than any such term referred to in any other subsection of this Section 8, and
such default shall not have been remedied or waived within 30 days after the
earlier of (i) an officer of Borrower or such Loan Party becoming aware of such
default or (ii) receipt by Borrower and such Loan Party of notice from
Administrative Agent or any Lender of such default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a decree or
order for relief in respect of Holdings or any of its Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, which decree
or order is not stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case shall be commenced
against Holdings or any of its Subsidiaries under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Holdings or any of its Subsidiaries, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of Holdings or any of its Subsidiaries for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Holdings or any of its Subsidiaries, and any such event described in
this clause (ii) shall continue for 60 days unless dismissed, bonded or
discharged; or
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Holdings or any of its Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property; or Holdings or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or (ii) Holdings or any of its
Subsidiaries shall be unable, or shall fail generally, or shall admit in writing
its inability, to pay its debts as such debts become due; or the Board of
Directors of Holdings or any of its Subsidiaries (or any committee thereof)
shall adopt any resolution or otherwise authorize any action to approve any of
the actions referred to in clause (i) above or this clause (ii); or
8.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar process
involving (i) in any individual case an amount in excess of $250,000, or (ii) in
the aggregate at any time an amount in excess of $250,000 (in either case not
adequately covered by insurance as to which a Solvent and unaffiliated insurance
company has acknowledged coverage) shall be entered or filed against Holdings or
any of its Subsidiaries or any of their respective assets and shall remain
undischarged, unvacated, unbonded or unstayed for a period of 30 days (or in any
event later than five days prior to the date of any proposed sale thereunder);
or
8.9 Dissolution.
Any order, judgment or decree shall be entered against Holdings or any
of its Subsidiaries decreeing the dissolution or split up of such Person and
such order shall remain undischarged or unstayed for a period in excess of 60
days; or
8.10 Employee Benefit Plans.
There shall occur one or more ERISA Events which individually or in the
aggregate results in or could reasonably be expected to result in liability of
Borrower or any of its Subsidiaries or any of their respective ERISA Affiliates
in excess of $500,000 during the term of this Agreement; or there shall exist an
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities), which exceeds $500,000; or
8.11 Change of Control.
Other than by reason of any IPO of Borrower Common Stock, Affiliates of
Trivest shall cease to beneficially own and control at least a majority of the
issued and outstanding shares of capital stock of Holdings entitled (without
regard to the occurrence of any contingency) to vote for the election of members
of the Board of Directors of Holdings, or Borrower shall cease to own
beneficially and of record, directly or indirectly, 100% of the outstanding
capital stock or other equity or ownership interests of each of the other Loan
Parties, or such ownership shall cease to vest in Borrower voting control of
each such Loan Party or a "Change of Control" under and as defined in the
Holding Notes or the Subordinated Note Indenture shall occur; or
8.12 Invalidity of Subsidiary Guaranty or Holdings Guaranty;
Failure of Security; Repudiation of Obligations.
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At any time after the execution and delivery thereof, (i) the
Subsidiary Guaranty or the Holdings Guaranty, for any reason other than the
satisfaction in full of all Obligations, shall cease to be in full force and
effect (other than in accordance with their terms) or shall be declared to be
null and void, (ii) any Collateral Document shall cease to be in full force and
effect (other than by reason of a release of Collateral thereunder in accordance
with the terms hereof or thereof, the satisfaction in full of the Obligations or
any other termination of such Collateral Document in accordance with the terms
hereof or thereof) or shall be declared null and void, or Administrative Agent
shall not have or shall cease to have a valid and First Priority Lien in any
Collateral purported to be covered thereby having a fair market value,
individually or in the aggregate, exceeding $150,000 (other than Deposit
Accounts, which shall be governed by subsection 6.10, and Inventory in transit
to Borrower or from Borrower to customers), in each case for any reason other
than the failure of Administrative Agent or any Lender to take any action within
its control, or (iii) any Loan Party shall contest the validity or
enforceability of any Loan Document in writing or deny in writing that it has
any further liability, including with respect to future advances by Lenders,
under any Loan Document to which it is a party; or
8.13 Material Adverse Effect.
Any event or change shall occur that has caused or evidences, either in
any case or in the aggregate, a Material Adverse Effect; or
8.14 Actions Relating to Certain Indebtedness.
Any event shall occur which requires Holdings or any of its
Subsidiaries to purchase, redeem or otherwise acquire or offer to purchase,
redeem or otherwise acquire all or any portion of any Subordinated Indebtedness;
or Holdings or any of its Subsidiaries shall for any other reason purchase,
redeem or otherwise acquire or offer to purchase, redeem or otherwise acquire,
or make any other payments in respect of, all or any portion of any Subordinated
Indebtedness, except to the extent expressly permitted by subsection 7.5; or
8.15 Failure of Holdings to Own Borrower.
Holdings ceases to own all of the outstanding capital stock of
Borrower; or
8.16 Failure to Consummate the Merger and the Acquisition.
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The Merger and the Acquisition shall not be consummated in accordance
with this Agreement and the applicable Related Agreements prior to or
concurrently with the making of the initial Loans, or the Merger or the
Acquisition shall be unwound, reversed or otherwise rescinded in whole or in
part for any reason:
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans, (b) an amount equal to the maximum amount that may at any time be drawn
under all Letters of Credit then outstanding (whether or not any beneficiary
under any such Letter of Credit shall have presented, or shall be entitled at
such time to present, the drafts or other documents or certificates required to
draw under such Letter of Credit), and (c) all other Obligations shall
automatically become immediately due and payable, without presentment, demand,
protest or other requirements of any kind, all of which are hereby expressly
waived by Borrower, and the obligation of each Lender to make any Loan, the
obligation of Administrative Agent to issue any Letter of Credit and the right
of any Lender to issue any Letter of Credit hereunder shall thereupon terminate,
and (ii) upon the occurrence and during the continuation of any other Event of
Default, Administrative Agent shall, upon the written request or with the
written consent of Requisite Lenders, by written notice to Borrower, declare all
or any portion of the amounts described in clauses (a) through (c) above to be,
and the same shall forthwith become, immediately due and payable, and the
obligation of each Lender to make any Loan, the obligation of Administrative
Agent to issue any Letter of Credit and the right of any Lender to issue any
Letter of Credit hereunder shall thereupon terminate; provided that the
foregoing shall not affect in any way the obligations of Lenders under
subsection 3.3C(i) or the obligations of Lenders to purchase participations in
any unpaid Swing Line Loans as provided in subsection 2.1A(iii).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Security Agreement and shall be applied as therein provided.
Notwithstanding anything contained in the second preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph Borrower shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Borrower, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended,
directly or indirectly, to benefit Borrower, and such provisions shall not at
any time be construed so as to grant Borrower the right to require Lenders to
rescind or annul any acceleration hereunder or to preclude Administrative Agent
or Lenders from exercising any of the rights or remedies available to them under
any of the Loan Documents, even if the conditions set forth in this paragraph
are met.
Section 9. ADMINISTRATIVE AGENT
9.1 Appointment.
A. Appointment of Administrative Agent. CIBC is hereby appointed Administrative
Agent hereunder and under the other Loan Documents and each Lender hereby
authorizes Administrative Agent to act as its Administrative Agent in accordance
with the terms of this Agreement and the other Loan Documents. Administrative
Agent agrees to act upon the express conditions contained in this Agreement and
the other Loan Documents, as applicable. The provisions of this Section 9 are
solely for the benefit of Administrative Agent and Lenders and Borrower shall
have no rights as a third party beneficiary of any of the provisions thereof. In
performing its functions and duties under this Agreement, Administrative Agent
shall act solely as an Administrative Agent of Lenders and does not assume and
shall not be deemed to have assumed any obligation towards or relationship of
agency or trust with or for Borrower or any of its Subsidiaries.
B. Appointment of Supplemental Collateral Agents. It is the purpose of this
Agreement and the other Loan Documents that there shall be no violation of any
law of any jurisdiction denying or restricting the right of banking corporations
or associations to transact business as Administrative Agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein or in any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
Collateral Agent or collateral co-Administrative Agent (any such additional
individual or institution being referred to herein individually as a
"Supplemental Collateral Agent" and collectively as "Supplemental Collateral
Agents").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent and all references therein to Administrative Agent shall be deemed to be
references to Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.
Should any instrument in writing from Borrower or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Borrower shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.2 Powers and Duties; General Immunity.
X. Xxxxxx; Duties Specified. Each Lender irrevocably authorizes Administrative
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to Administrative Agent by the terms hereof
and thereof, together with such powers, rights and remedies as are reasonably
incidental thereto. Administrative Agent shall have only those duties and
responsibilities that are expressly specified in this Agreement and the other
Loan Documents. Administrative Agent may exercise such powers, rights and
remedies and perform such duties by or through its agents or employees.
Administrative Agent shall not have, by reason of this Agreement or any of the
other Loan Documents, a fiduciary relationship in respect of any Lender; and
nothing in this Agreement or any of the other Loan Documents, expressed or
implied, is intended to or shall be so construed as to impose upon
Administrative Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
B. No Responsibility for Certain Matters. Administrative Agent shall not be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Administrative Agent to Lenders or by
or on behalf of Borrower to Administrative Agent or any Lender in connection
with the Loan Documents and the transactions contemplated thereby or for the
financial condition or business affairs of Borrower or any other Person liable
for the payment of any Obligations, nor shall Administrative Agent be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained in any of the Loan
Documents or as to the use of the proceeds of the Loans, the use of the Letters
of Credit or as to the existence or possible existence of any Event of Default
or Potential Event of Default. Anything contained in this Agreement to the
contrary notwithstanding, Administrative Agent shall not have any liability
arising from confirmations of the amount of outstanding Loans or the Letter of
Credit Usage or the component amounts thereof.
C. Exculpatory Provisions. Neither Administrative Agent nor any of its officers,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by Administrative Agent under or in connection with any of the Loan
Documents except to the extent caused by Administrative Agent's gross negligence
or willful misconduct. Administrative Agent shall be entitled to refrain from
any act or the taking of any action (including the failure to take an action) in
connection with this Agreement or any of the other Loan Documents or from the
exercise of any power, discretion or authority vested in it hereunder or
thereunder unless and until Administrative Agent shall have received
instructions in respect thereof from Requisite Lenders (or such other Lenders as
may be required to give such instructions under subsection 10.6) and, upon
receipt of such instructions from Requisite Lenders (or such other Lenders, as
the case may be), Administrative Agent shall be entitled to act or (where so
instructed) refrain from acting, or to exercise such power, discretion or
authority, in accordance with such instructions. Without prejudice to the
generality of the foregoing, (i) Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any communication, instrument or
document believed by it to be genuine and correct and to have been signed or
sent by the proper person or persons, and shall be entitled to rely and shall be
protected in relying on opinions and judgments of attorneys (who may be
attorneys for Borrower and its Subsidiaries), accountants, experts and other
professional advisors selected by it; and (ii) no Lender shall have any right of
action whatsoever against Administrative Agent as a result of Administrative
Agent acting or (where so instructed) refraining from acting under this
Agreement or any of the other Loan Documents in accordance with the instructions
of Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 10.6).
D. Administrative Agent Entitled to Act as Lender. The agency hereby created
shall in no way impair or affect any of the rights and powers of, or impose any
duties or obligations upon, Administrative Agent in its individual capacity as a
Lender hereunder. With respect to its participation in the Loans and the Letters
of Credit, Administrative Agent shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were not performing
the duties and functions delegated to it hereunder, and the term "Lender" or
"Lenders" or any similar term shall, unless the context clearly otherwise
indicates, include Administrative Agent in its individual capacity.
Administrative Agent and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of banking, trust, financial advisory or other
business with Borrower or any of its Affiliates as if it were not performing the
duties specified herein, and may accept fees and other consideration from
Borrower for services in connection with this Agreement and otherwise without
having to account for the same to Lenders.
9.3 Representations and Warranties; No Responsibility For
Appraisal of Creditworthiness.
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Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Borrower and
its Subsidiaries in connection with the making of the Loans hereunder and that
it has made and shall continue to make its own appraisal of the creditworthiness
of Borrower and its Subsidiaries. Administrative Agent shall not have any duty
or responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto (except as
required by this Agreement), whether coming into its possession before the
making of the Loans or at any time or times thereafter, and Administrative Agent
shall not have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
9.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify Administrative Agent, to the extent that Administrative Agent is
required to be reimbursed by Borrower under the Loan Documents and shall not
have been so reimbursed by Borrower, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any kind
or nature whatsoever which may be imposed on, incurred by or asserted against
Administrative Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Loan Documents or otherwise in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or the other Loan Documents; provided that no Lender shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from
Administrative Agent's gross negligence or willful misconduct. If any indemnity
furnished to Administrative Agent for any purpose shall, in the opinion of
Administrative Agent, be insufficient or become impaired, Administrative Agent
may call for additional indemnity and cease, or not commence, to do the acts
indemnified against until such additional indemnity is furnished.
9.5 Successor Administrative Agent and Successor Swing Line Lender.
A. Successor Administrative Agent. Administrative Agent may resign at any time
by giving 30 days' prior written notice thereof to Lenders and Borrower, and
Administrative Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Borrower and
Administrative Agent and signed by Requisite Lenders. Upon any such notice of
resignation or any such removal, Requisite Lenders shall have the right, upon
five Business Days' notice to Borrower, to appoint a successor Administrative
Agent. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Administrative Agent and the retiring or
removed Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
B. Successor Swing Line Lender. Swing Line Lender may resign at any time by
giving 30 days' prior written notice thereof to Administrative Agent, Lenders
and Borrower, and Swing Line Lender may be removed at any time with or without
cause by an instrument or concurrent instruments in writing delivered to
Borrower and Administrative Agent and signed by Requisite Lenders. In such event
(i) Borrower shall prepay any outstanding Swing Line Loans made by the retiring
or removed Swing Line Lender in its capacity as Swing Line Lender, (ii) upon
such prepayment, the retiring or removed Swing Line Lender shall surrender the
Swing Line Note held by it to Borrower for cancellation, and (iii) Borrower
shall issue a new Swing Line Note to the successor Swing Line Lender
substantially in the form of Exhibit VII annexed hereto, in the principal amount
of the Swing Line Loan Commitment then in effect and with other appropriate
insertions.
9.6 Collateral Documents and Guaranties.
Each Lender hereby further authorizes Administrative Agent, on behalf
of and for the benefit of Lenders, to enter into each Collateral Document as
secured party and to be Administrative Agent for and representative of Lenders
under each of the Guaranties, and each Lender agrees to be bound by the terms of
each Collateral Document and each of the Guaranties; provided that
Administrative Agent shall not (i) enter into or consent to any material
amendment, modification, termination or waiver of any provision contained in any
Collateral Document or any of the Guaranties or (ii) release any Collateral or
Subsidiary Guarantor (except as otherwise expressly permitted or required
pursuant to the terms of this Agreement or the applicable Collateral Document),
in each case without the prior consent of Requisite Lenders (or, if required
pursuant to subsection 10.6, all Lenders); provided further, however, that,
without further written consent or authorization from Lenders, Administrative
Agent may execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets permitted by this Agreement or to which Requisite Lenders
have otherwise consented, or (b) release any Subsidiary Guarantor from the
Subsidiary Guaranty if all of the capital stock of such Subsidiary Guarantor is
sold to any Person (other than an Affiliate of Borrower) pursuant to a sale or
other disposition permitted hereunder or to which Requisite Lenders have
otherwise consented. Anything contained in any of the Loan Documents to the
contrary notwithstanding, Borrower, Administrative Agent and each Lender hereby
agree that (X) no Lender shall have any right individually to realize upon any
of the Collateral under any Collateral Document or to enforce any Guaranty, it
being understood and agreed that all powers, rights and remedies under the
Collateral Documents and the Guaranties may be exercised solely by
Administrative Agent for the benefit of Lenders in accordance with the terms
thereof, and (Y) in the event of a foreclosure by Administrative Agent on any of
the Collateral pursuant to a public or private sale, Administrative Agent or any
Lender may be the purchaser of any or all of such Collateral at any such sale
and Administrative Agent, as Administrative Agent for and representative of
Lenders (but not any Lender or Lenders in its or their respective individual
capacities unless Requisite Lenders shall otherwise agree in writing) shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold at any such public
sale, to use and apply any of the Obligations as a credit on account of the
purchase price for any Collateral payable by Administrative Agent at such sale.
Section 10. MISCELLANEOUS
10.1 Assignments and Participations in Loans.
A. General. Subject to subsections 10.1B and 10.1C, each Lender shall have the
right at any time to (i) sell, assign or transfer to any Eligible Assignee, or
(ii) sell participations to any Person in, all or any part of its Commitments or
any Loan or Loans made by it or its Letters of Credit or participations therein
or any other interest herein or in any other Obligations owed to it; provided
that no such sale, assignment, transfer or participation shall, without the
consent of Borrower, require Borrower to file a registration statement with the
Securities and Exchange Commission or apply to qualify such sale, assignment,
transfer or participation under the securities laws of any state; provided,
further, that no such sale, assignment or transfer described in clause (i) above
shall be effective unless and until an Assignment Agreement effecting such sale,
assignment or transfer shall have been accepted by Administrative Agent and
recorded in the Register as provided in subsection 10.1B(ii); provided, further,
that no such sale, assignment or transfer of any Letter of Credit or any
participation therein may be made separately from a sale, assignment, transfer
or participation of a corresponding interest in the Revolving Loan Commitment
and the Revolving Loans of the Lender effecting such sale, assignment, transfer
or participation; and provided, further, that, anything contained herein to the
contrary notwithstanding, the Swing Line Loan Commitment and the Swing Line
Loans of Swing Line Lender may not be sold, assigned or transferred as described
in clause (i) above to any Person other than a successor Swing Line Lender to
the extent contemplated by subsection 9.5. Except as otherwise provided in this
subsection 10.1, no Lender shall, as between Borrower and such Lender, be
relieved of any of its obligations hereunder as a result of any sale, assignment
or transfer of, or any granting of participations in, all or any part of its
Commitments or the Loans, or participations therein, or the other Obligations
owed to such Lender, and such Lender shall remain solely responsible for the
performance of such Obligations, and Borrower shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan, Letter of
Credit or participation therein, or other Obligation may (a) be assigned in
any amount to another Lender, or to an Affiliate or Approved Fund of the
assigning Lender or another Lender, with the giving of notice to Borrower
and Administrative Agent or (b) be assigned in an aggregate amount of not
less than $5,000,000, in the case of any assignment of a Revolving Loan
Commitment, or $1,000,000, in the case of any assignment of a Term Loan (or
such lesser amount as shall constitute the aggregate amount of the
Commitments, Loans, Letters of Credit and participations therein, and other
Obligations of the assigning Lender) to any other Eligible Assignee
treating any two or more Approved Funds with the same investment advisor as
a single Eligible Assignee with the consent of Borrower (unless a Potential
Event of Default or an Event of Default has occurred and is continuing or,
with respect to assignments of Term Loans, such assignment is made within
ten Business Days of the Closing Date) and Administrative Agent (which
consent of Borrower and Administrative Agent shall not be unreasonably
withheld or delayed). To the extent of any such assignment in accordance
with either clause (a) or (b) above, the assigning Lender shall be relieved
of its obligations with respect to its Commitments, Loans, Letters of
Credit or participations therein, or other Obligations or the portion
thereof so assigned. The parties to each such assignment shall execute and
deliver to Administrative Agent, for its acceptance and recording in the
Register, an Assignment Agreement, together with a processing and
recordation fee of $3,500 (provided that (i) no such processing and
recordation fee shall be payable if the assignee is an Affiliate of the
assignor or a Person under common management with the assignor, and (ii)
only one such fee shall be required in connection with a simultaneous
assignment to a group of Approved Funds with the same investment advisor)
and such forms (including an administrative questionnaire if the Eligible
Assignee is not a Lender), certificates or other evidence, if any, with
respect to United States federal income tax withholding matters as the
assignee under such Assignment Agreement may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery, acceptance and recordation, from and after the
effective date specified in such Assignment Agreement, (y) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment
Agreement, shall have the rights and obligations of a Lender hereunder, and
(z) the assigning Lender thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment
Agreement, relinquish its rights (other than any rights which survive the
termination of this Agreement under subsection 10.9B) and be released from
its obligations under this Agreement (and, in the case of an Assignment
Agreement covering all or the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be
a party hereto; provided that, anything contained in any of the Loan
Documents to the contrary notwithstanding, if such Lender is the Issuing
Lender with respect to any outstanding Letters of Credit such Lender shall
continue to have all rights and obligations of an Issuing Lender with
respect to such Letters of Credit until the cancellation or expiration of
such Letters of Credit and the reimbursement of any amounts drawn
thereunder). The Commitments hereunder shall be modified to reflect the
Commitment of such assignee and any remaining Commitment of such assigning
Lender and, if any such assignment occurs after the issuance of any Notes
hereunder, the assigning Lender shall, upon the effectiveness of such
assignment or as promptly thereafter as practicable, surrender its
applicable Notes, if any, to Administrative Agent for cancellation, and
thereupon new Notes shall, if so requested by the assignee and/or the
assigning Lender in accordance with subsection 2.1D, be issued to the
assignee and/or to the assigning Lender, substantially in the form of
Exhibit V, Exhibit V or Exhibit VII annexed hereto, as the case may be,
with appropriate insertions, to reflect the new Commitments and/or
outstanding Term Loans, as the case may be, of the assignee and/or the
assigning Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this subsection
10.1B shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection 10.1C.
(ii) Acceptance by Administrative Agent; Recordation in Register. Upon its
receipt of an Assignment Agreement executed by an assigning Lender and an
assignee representing that it is an Eligible Assignee, together with the
processing and recordation fee referred to in subsection 10.1B(i) (if so
required) and any forms, certificates or other evidence with respect to
United States federal income tax withholding matters that such assignee may
be required to deliver to Administrative Agent pursuant to subsection
2.7B(iii)(a), Administrative Agent shall, if Administrative Agent (and if
necessary, Borrower) has consented to the assignment evidenced thereby (in
each case to the extent such consent is required pursuant to subsection
10.1B(i)), (a) accept such Assignment Agreement by executing a counterpart
thereof as provided therein (which acceptance shall evidence any required
consent of Administrative Agent to such assignment), (b) record the
information contained therein in the Register, and (c) give prompt notice
thereof to Borrower. Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in this
subsection 10.1B(ii).
C. Participations. Any Lender may, without the consent of, or notice to,
Borrower or Administrative Agent, sell participations to one or more banks
or other entities (a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion
of its Commitment and/or the Loans owing to it); provided that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, and (iii) Borrower, Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells
such a participation shall provide that such Lender shall retain the sole
right to enforce the Loan Documents and to approve any amendment,
modification or waiver of any provision of the Loan Documents; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of such Participant, agree to any amendment,
modification or waiver that affects such Participant if such amendment,
modification or waiver requires the unanimous written consent of all
Lenders pursuant to subsection 10.6. Subject to subsection 10.1D, Borrower
agrees that each Participant shall be entitled to the benefits of
subsections 2.6D, 2.7, and 3.6 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to subsection 10.1B;
provided, however, that in no event shall Borrower be obligated to make any
payment with respect to such subsections which is greater than the amount
that Borrower would have paid to the Lender had no such participation been
sold. To the extent permitted by law, in the event that any amounts
outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an
Event of Default, each participant shall be deemed to have the right of
set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement.
D. A Participant shall not be entitled to receive any greater payment under
subsections 2.6D, 2.7, and 3.6 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with Borrower's prior written consent. A Participant that would be a
Non-US Lender if it were a Lender shall not be entitled to the benefits of
subsection 2.7 unless Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of Borrower,
to comply with subsection 2.7B(iii) as though it were a Lender.
E. Assignments to Secured Parties and Trustees. In addition to the
assignments and participations permitted under the foregoing provisions of
this subsection 10.1, (a) any Lender may assign and pledge all or any
portion of its Loans, the other Obligations owed to such Lender, and its
Notes to any creditor, including any Federal Reserve Bank, as collateral
security pursuant to Regulation A of the Board of Governors of the Federal
Reserve System and any operating circular issued by such Federal Reserve
Bank; provided that (i) no Lender shall, as between Borrower and such
Lender, be relieved of any of its obligations hereunder as a result of any
such assignment and pledge and (ii) in no event shall such creditor be
considered to be a "Lender" or be entitled to require the assigning Lender
to take or omit to take any action hereunder, (b) any Lender which is a
Fund may pledge its Notes to its trustee for the benefit of its investors.
F. Information. Each Lender may furnish any information concerning Borrower
and its Subsidiaries in the possession of that Lender from time to time to
assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
G. Representations of Lenders. Each Lender listed on the signature pages
hereof hereby represents and warrants (i) that it is an Eligible Assignee
described in clause (A) of the definition thereof; (ii) that it has
experience and expertise in the making of loans such as the Loans; and
(iii) that it will make its Loans for its own account in the ordinary
course of its business and without a present view to distribution of such
Loans within the meaning of the Securities Act or the Exchange Act or other
federal securities laws (it being understood that, subject to the
provisions of this subsection 10.1, the disposition of such Loans or any
interests therein shall at all times remain within its exclusive control).
Each Lender that becomes a party hereto pursuant to an Assignment Agreement
shall be deemed to agree that the representations and warranties of such
Lender contained in Section 1.2 of such Assignment Agreement are
incorporated herein by this reference.
10.2 Expenses.
Whether or not the transactions contemplated hereby shall be
consummated, Borrower agrees to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto; (ii) all the costs of
furnishing all opinions by counsel for Borrower (including any opinions
requested by Lenders as to any legal matters arising hereunder) and of
Borrower's performance of and compliance with all agreements and conditions on
its part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable fees,
expenses and disbursements of counsel to Administrative Agent in connection with
the negotiation, preparation, execution and administration of the Loan Documents
and any consents, amendments, waivers or other modifications thereto and any
other documents or matters requested by Borrower; (iv) all the actual costs and
reasonable expenses of creating and perfecting Liens in favor of Administrative
Agent on behalf of Lenders pursuant to any Collateral Document, including filing
and recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to Administrative Agent and of counsel providing any opinions that
Administrative Agent or Requisite Lenders may request in respect of the
Collateral Documents or the Liens created pursuant thereto; (v) all the actual
costs and reasonable expenses (including the reasonable fees, expenses and
disbursements of any auditors, accountants or appraisers and any environmental
or other consultants, advisors and agents employed or retained by Administrative
Agent or its counsel) of obtaining and reviewing any environmental audits or
reports provided for under subsection 4.1J or 6.7B and any audits or reports
provided for under subsection 4.1K or 6.5B with respect to Inventory and
accounts receivable of Borrower and its Subsidiaries; (vi) the custody or
preservation of any of the Collateral; (vii) all other actual and reasonable
costs and expenses incurred by Administrative Agent in connection with the
syndication of the Commitments and the negotiation, preparation and execution of
the Loan Documents and any consents, amendments, waivers or other modifications
thereto and the transactions contemplated thereby; and (viii) after the
occurrence of an Event of Default, all costs and expenses, including reasonable
attorneys' fees (including allocated costs of internal counsel) and costs of
settlement, incurred by Administrative Agent and Lenders in enforcing any
Obligations of or in collecting any payments due from any Loan Party hereunder
or under the other Loan Documents by reason of such Event of Default (including
in connection with the sale of, collection from, or other realization upon any
of the Collateral or the enforcement of the Subsidiary Guaranty) or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a "work-out" or pursuant to any
insolvency or bankruptcy proceedings.
10.3 Indemnity.
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless Administrative Agent and Lenders, and the
officers, directors, employees, counsel, agents, representatives, advisors and
affiliates of Administrative Agent and Lenders (collectively called the
"Indemnitees"), from and against any and all Indemnified Liabilities (as
hereinafter defined); provided that Borrower shall not have any obligation to
any Indemnitee hereunder with respect to any Indemnified Liabilities to the
extent such Indemnified Liabilities arise from the gross negligence or willful
misconduct of that Indemnitee as determined by a final judgment of a court of
competent jurisdiction.
As used herein, "Indemnified Liabilities" means, collectively, any and
all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including Environmental
Claims), costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Loan Documents or the Related
Agreements or the transactions contemplated hereby or thereby (including
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds thereof or the issuance of Letters of Credit hereunder or the use or
intended use of any thereof), or any enforcement of any of the Loan Documents
(including any sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Subsidiary Guaranty), (ii) the statements
contained in the commitment letter delivered by any Lender to Borrower or
Administrative Agent with respect thereto, or (iii) any Environmental Claim or
any Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or practice
of Borrower or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this subsection 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, Borrower shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 Set-Off; Security Interest in Deposit Accounts.
In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence of any
Event of Default each Lender is hereby authorized by Borrower at any time or
from time to time, without notice to Borrower or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits or other amounts held by any Lender for the credit or
account of Borrower (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by that Lender to
or for the credit or the account of Borrower against and on account of the
obligations and liabilities of Borrower to that Lender under this Agreement, the
Letters of Credit and participations therein and the other Loan Documents,
including all claims of any nature or description arising out of or connected
with this Agreement, the Letters of Credit and participations therein or any
other Loan Document, irrespective of whether or not (i) that Lender shall have
made any demand hereunder or (ii) the principal of or the interest on the Loans
or any amounts in respect of the Letters of Credit or any other amounts due
hereunder or under any of the other Loan Documents shall have become due and
payable pursuant to Section 8 and although said obligations and liabilities, or
any of them, may be contingent or unmatured. Borrower hereby further grants to
Administrative Agent and each Lender a security interest in all deposits and
accounts maintained with Administrative Agent or such Lender as security for the
Obligations.
10.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) that is greater than the proportion received by any
other Lender in respect of the Aggregate Amounts Due to such other Lender, then
the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them hereunder; provided that if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender upon the bankruptcy or reorganization of Borrower or
otherwise (and whether by litigation, demand, settlement or otherwise), those
purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Lender ratably to the extent
of such recovery, but without interest. Borrower expressly consents to the
foregoing arrangement and agrees that any holder of a participation so purchased
may exercise any and all rights of banker's lien, set-off or counterclaim with
respect to any and all monies owing by Borrower to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.
10.6 Amendments and Waivers.
No amendment, modification, termination or waiver of any provision of
this Agreement or of the Notes or of any of the other Loan Documents, and no
consent to any departure by Borrower herefrom or therefrom, shall in any event
be effective without the written concurrence of Requisite Lenders unless
otherwise provided elsewhere in this Agreement; provided that in addition, any
such amendment, modification, termination, waiver or consent which:
(i) postpones the date or reduces the amount of any scheduled payment (but
not prepayment, except for prepayments pursuant to subsection 2.4B(iii)(e))
of principal of any of the Loans;
(ii) postpones the date on which any interest or any fees are payable or
reduces the amount of any interest or any fees payable hereunder;
(iii) changes in any manner the definition of "Pro Rata Share", the
definition of "Class", the definition of "Requisite Class Lenders" or the
definition of "Requisite Lenders";
(iv) changes in any manner any provision of this Agreement which, by its
terms, expressly requires the approval or concurrence of all Lenders;
(v) releases any Lien granted in favor of Administrative Agent with respect
to all or substantially all of the Collateral;
(vi) releases all or substantially all of the Subsidiary Guarantors from
their obligations under the Subsidiary Guaranty, in each case other than in
accordance with the terms of the Loan Documents;
(vii) changes in any manner the provisions contained in subsection 8.1 or
this subsection 10.6;
(viii) releases Holdings from its obligations under the Holdings Guaranty
or the Security Agreement other than in accordance with the terms of the
Loan Documents; or
(ix) increases the aggregate amount of the Term Loan Commitments or the
aggregate amount of the Revolving Loan Commitments over the amount thereof
then in effect (it being understood that amendments, modifications or
waivers of conditions precedent, representations and warranties, covenants
or Events of Default or of a mandatory reduction in the Commitments shall
not constitute an increase of the Commitments, and that an increase in the
available portion of any Commitments shall not constitute an increase in
the Commitments); shall be effective only if evidenced by the written
concurrence of all Lenders.
In addition,
(a) no amendment, modification, termination or waiver of any provision
of any Note shall be effective without the written concurrence of the
Lender which is the holder of that Note;
(b) no amendment, modification, termination or waiver of any provision
of subsection 2.1A(i)-(ii) or of any other provision of this Agreement
relating to the Term Loan Commitments or the Revolving Loan
Commitments shall increase the Commitments of any Lender over the
amount thereof then in effect without the consent of such Lender (it
being understood that amendments, modifications or waivers of
conditions precedent, representations and warranties, covenants or
Events of Default or of a mandatory reduction in the Commitments shall
not constitute an increase of the Commitment of any Lender, and that
an increase in the available portion of any Commitment of any Lender
shall not constitute an increase in the Commitment of such Lender);
(c) no amendment, modification, termination or waiver of any provision
of subsection 2.1A(iii) or of any other provision of this Agreement
relating to the Swing Line Loan Commitment or the Swing Line Loans
shall be effective without the written concurrence of Swing Line
Lender;
(d) no amendment, modification, termination or waiver of any provision
of Section 9 or of any other provision of this Agreement which, by its
terms, expressly requires the approval or concurrence of
Administrative Agent shall be effective without the written
concurrence of Administrative Agent;
(e) no amendment, modification, termination or waiver of any provision
of subsection 2.4 which changes or waives any voluntary and mandatory
prepayments, call protection or the ability of any Term Loan Lender to
waive the right to receive any voluntary or mandatory prepayment, or
reducing Commitments applicable to any Class shall be effective
without the written concurrence of Requisite Class Lenders of such
Class; and
(f) no amendment, modification, termination or waiver of any provision
of subsection 2.2 which decreases the interest rate borne by Loans of
any Class (other than any waiver of any increase in the interest rate
applicable to such Loans pursuant to subsection 2.2E) or the
percentages set forth in the definitions of "Applicable Base Rate
Margin" and "Applicable LIBOR Margin" shall be effective without the
written concurrence of all Lenders of such Class.
Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was given. No
notice to or demand on Borrower in any case shall entitle Borrower to any other
or further notice or demand in similar or other circumstances. Any amendment,
modification, termination, waiver or consent effected in accordance with this
subsection 10.6 shall be binding upon each Lender at the time outstanding, each
future Lender and, if signed by Borrower, on Borrower. Notwithstanding anything
contained herein to the contrary, as among Lenders and Administrative Agent in
connection with the exercise of remedies under any of Loan Documents, the
written concurrence of Requisite Lenders shall be required for Administrative
Agent to execute proxy rights in the election of the board of directors of any
Loan Party owning real property or to acquire any ownership interest in real
property of any Loan Party.
10.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 Notices.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed; provided that notices to Administrative Agent shall not
be effective until received. For the purposes hereof, the address of each party
hereto shall be as set forth under such party's name on the signature pages
hereof or (i) as to Borrower and Administrative Agent, such other address as
shall be designated by such Person in a written notice delivered to the other
parties hereto and (ii) as to each other party, such other address as shall be
designated by such party in a written notice delivered to Administrative Agent.
10.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of
the Loans and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the contrary,
the agreements of Borrower set forth in subsections 2.6D, 2.7, 3.5A, 3.6, 7.17,
10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections 9.2C,
9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Administrative Agent or any Lender
in the exercise of any power, right or privilege hereunder or under any other
Loan Document shall impair such power, right or privilege or be construed to be
a waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Borrower or any other party or
against or in payment of any or all of the Obligations. To the extent that
Borrower makes a payment or payments to Administrative Agent or Lenders (or to
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law, common
law or any equitable cause (whether by litigation, demand, settlement or
otherwise), then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
10.12 Severability.
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders' Rights.
The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders, or
Lenders and Borrower, as a partnership, an association, a joint venture or any
other kind of entity. The amounts payable at any time hereunder to each Lender
shall be a separate and independent debt, and each Lender shall be entitled to
protect and enforce its rights arising out of this Agreement and it shall not be
necessary for any other Lender to be joined as an additional party in any
proceeding for such purpose.
10.14 Headings.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 Applicable Law.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
10.16 Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that Borrower may not assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by Borrower without such
consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, Affiliates of Administrative Agent and
Affiliates of Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
10.17 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWER ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING AND
DELIVERING THIS AGREEMENT, BORROWER, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF
SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO BORROWER AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SUBSECTION 10.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER BORROWER IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY
OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO
THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
10.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each party hereto acknowledges that this waiver is a material
inducement to enter into a business relationship, that each has already relied
on this waiver in entering into this Agreement, and that each will continue to
rely on this waiver in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
10.19 Confidentiality.
Each Lender shall hold all non-public information obtained pursuant to
the requirements of this Agreement that has been identified in writing as
confidential by Borrower in accordance with such Lender's customary procedures
for handling confidential information of this nature and in accordance with safe
and sound banking practices, it being understood and agreed by Borrower that in
any event a Lender may make disclosures (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such information and
instructed to keep such information confidential), (b) to the extent requested
by any government authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this subsection 10.19, to (i) any Eligible
Assignee of or participant in, or any prospective Eligible Assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii)
any direct or indirect contractual counterparty or prospective counterparty (or
such contractual counterparty's or prospective counterparty's professional
advisor) to any credit derivative transaction relating to obligations of
Borrower, (g) with the consent of Borrower, (h) to the extent such information
(i) becomes publicly available other than as a result of a breach of this
subsection 10.19, or (ii) becomes available to Administrative Agent or any
Lender on a nonconfidential basis from a source other than Borrower, or (i) to
the National Association of Insurance Commissioners or any other similar
organization or any nationally recognized rating agency that requires access to
information about a Lender's or its Affiliates' investment portfolio in
connection with ratings issued with respect to such Lender or its Affiliates;
provided that, unless specifically prohibited by applicable law or court order,
each Lender shall notify Borrower of any request by any government authority or
representative thereof (other than any such request in connection with any
examination of the financial condition of such Lender by such government
authority) for disclosure of any such non-public information prior to disclosure
of such information; and provided, further, that in no event shall any Lender be
obligated or required to return any materials furnished by Borrower or any of
its Subsidiaries. Notwithstanding anything contained herein to the contrary,
Borrower understands and agrees that Administrative Agent and each of the
institutions identified as "Lead Arranger," "Co-Lead Arranger," "Documentation
Agent" or "Co-Syndication Agent" on the title page to this Agreement may make
customary disclosures for advertising and "league table" purposes.
10.20 Lead Arranger, Bookrunner, Documentation Agent and Syndication Agent.
None of the institutions identified as "Lead Arranger," "Co-Lead
Arranger," "Documentation Agent" or "Co-Syndication Agent" on the title page to
this Agreement shall have any obligations, liabilities or duties under this
Agreement other than those applicable to a Lender (but only if such institution
is a Lender) as such, and no such institution shall have or be deemed to have
any fiduciary relationship with any Lender. Each Lender acknowledges that it has
not relied, and will not rely, on any such institution in deciding to enter into
this Agreement or in taking or not taking any action hereunder.
10.21 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Borrower and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
CREDIT AGREEMENT
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized as
of the date first written above.
WINSLOEW FURNITURE, INC.
By: _____________________________
Xxxxxxx Xxxxxxxxx, Xx.
Chief Financial Officer and Assistant Secretary
Notice Address:
WinsLoew Furniture, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Chief Executive Officer
Facsimile No.: (000) 000-0000
with a copy to:
Trivest, Inc.
0000 Xxxxx Xxxxxxxx Xxxxx
0xx Xxxxx
Xxxxx, XX 00000-0000
Attn.: Xxxxx Xxxxxx
Facsimile No.: (000) 000-0000
CANADIAN IMPERIAL BANK OF COMMERCE, as Administrative Agent
By: _____________________________
Xxxx X. Xxxxxx
Executive Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CANADIAN IMPERIAL BANK OF COMMERCE
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Agency Services Dept.
Facsimile No.: (000) 000-0000
With a Copy to:
CIBC WORLD MARKETS CORP.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
CIBC WORLD MARKETS CORP., as Lead Arranger
By: _____________________________
Xxxx X. Xxxxxx
Executive Director
Notice Address:
CIBC WORLD MARKETS CORP.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
With a Copy to:
CANADIAN IMPERIAL BANK OF COMMERCE
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Agency Services Dept.
Facsimile No.: (000) 000-0000
CIBC, INC., as a Lender and as Swing Line Lender
By: _____________________________
Xxxx X. Xxxxxx
Executive Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CIBC, INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Agency Services Dept.
Facsimile No.: (000) 000-0000
With a Copy to:
CIBC WORLD MARKETS CORP.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
CREDIT AGREEMENT
Dated as of May 8, 2001
among
WINSLOEW FURNITURE, INC.,
as Borrower,
THE LENDERS LISTED HEREIN OR
PARTY FROM TIME TO TIME HERETO,
as Lenders,
CIBC INC.,
as Swing Line Lender,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent,
Antares Capital CORPORATION,
as Co-Syndication Agent,
XXXXXX FINANcial, inc.,
as Co-Syndication Agent,
GENERAL ELECTRIC CAPITAL CORPORATION,
as Documentation Agent,
CIBC WORLD MARKETS CORP.,
as Lead Arranger,
and
Antares Capital CORPORATION
and
XXXXXX FINANcial, inc.,
as Co-Lead Arrangers
Table of Contents
Page
CREDIT AGREEMENT
Section 1. DEFINITIONS.........................................................3
1.1 Certain Defined Terms...............................................3
1.2 Accounting Terms; Utilization of GAAP for Purposes
of Calculations Under Agreement....................................34
1.3 Other Definitional Provisions and Rules of Construction............34
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS.........................35
2.1 Commitments; Making of Loans; Optional Notes.......................35
2.2 Interest on the Loans..............................................43
2.3 Fees...............................................................47
2.4 Repayments and Prepayments; General
Provisions Regarding Payments;
Application of Proceeds of Collateral
and Payments Under Subsidiary
Guaranty...........................................................48
2.5 Use of Proceeds....................................................56
2.6 Special Provisions Governing LIBOR Loans...........................57
2.7 Increased Costs; Taxes; Capital Adequacy...........................59
2.8 Obligation of Lenders and Issuing Lenders to Mitigate..............63
Section 3. LETTERS OF CREDIT..................................................64
3.1 Issuance of Letters of Credit and Lenders'
Purchase of Participations Therein.................................64
3.2 Letter of Credit Fees..............................................66
3.3 Drawings and Reimbursement of Amounts
Paid Under Letters of Credit.......................................67
3.4 Obligations Absolute...............................................70
3.5 Indemnification; Nature of Issuing
Lenders' Duties....................................................71
3.6 Increased Costs and Taxes Relating
to Letters of Credit...............................................72
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT..........................73
4.1 Conditions to Term Loans and Initial
Revolving Loans and Swing Line Loans...............................73
4.2 Conditions to All Loans............................................82
4.3 Conditions to Letters of Credit....................................83
Section 5. BORROWER'S REPRESENTATIONS AND WARRANTIES..........................83
5.1 Organization, Powers, Qualification,
Good Standing, Business and Subsidiaries...........................83
5.2 Authorization of Borrowing, etc....................................84
5.3 Financial Condition...............................................85
5.4 No Material Adverse Change;
No Restricted Junior Payments.....................................86
5.5 Title to Properties; Liens; Real Property.........................86
5.6 Litigation; Adverse Facts.........................................87
5.7 Payment of Taxes..................................................87
5.8 Performance of Agreements;
Materially Adverse Agreements; Material Contracts.................87
5.9 Governmental Regulation...........................................88
5.10 Securities Activities.............................................88
5.11 Employee Benefit Plans............................................88
5.12 Certain Fees......................................................89
5.13 Environmental Protection..........................................89
5.14 Employee Matters..................................................90
5.15 Solvency.........................................................90
5.16 Matters Relating to Collateral...................................90
5.17 Related Agreements...............................................91
5.18 Accounts Receivable..............................................91
5.19 Inventory........................................................92
5.20 Disclosure.......................................................92
5.21 Subordination....................................................92
5.22 Mortgage Taxes, Etc..............................................92
5.23 Foreign Subsidiaries.............................................93
Section 6. BORROWER'S AFFIRMATIVE COVENANTS.................................93
6.1 Financial Statements and Other Reports...........................93
6.2 Corporate Existence, etc.........................................99
6.3 Payment of Taxes and Claims; Tax Consolidation...................99
6.4 Maintenance of Properties; Insurance;
Application of Net
Insurance/Condemnation Proceeds.................................100
6.5 Inspection Rights; Audits of Inventory
and Accounts Receivable; Lender Meeting.........................102
6.6 Compliance with Laws, etc.......................................102
6.7 Environmental Review and Investigation,
Disclosure, Etc.; Borrower's Actions Regarding
Hazardous Materials Activities,
Environmental Claims and
Violations of Environmental Laws................................102
6.8 Execution of Subsidiary Guaranty and
Personal Property Collateral
Documents by Certain Subsidiaries
and Future Subsidiaries.........................................105
6.9 Conforming Leasehold Interests;
Matters Relating to Additional Real
Property Collateral.............................................106
6.10 Deposit Accounts and Cash Management Systems....................108
6.11 Interest Rate Cap...............................................109
6.12 Assignment of Claims Act........................................109
6.13 Landlord Consents and Estoppels;
Recorded Leasehold Interests....................................109
6.14 Other Post-Closing Matters......................................109
Section 7. BORROWER'S NEGATIVE COVENANTS...................................109
7.1 Indebtedness....................................................110
7.2 Liens and Related Matters.......................................110
7.3 Investments; Joint Ventures.....................................111
7.4 Contingent Obligations..........................................112
7.5 Restricted Junior Payments......................................113
7.6 Financial Covenants.............................................114
7.7 Restriction on Fundamental Changes;
Asset Sales and Acquisitions....................................117
7.8 Consolidated Capital Expenditures...............................118
7.9 Restriction on Leases...........................................118
7.10 Sales and Lease-Backs...........................................118
7.11 Sale or Discount of Receivables.................................118
7.12 Transactions with Shareholders and Affiliates...................119
7.13 Disposal of Subsidiary Stock....................................119
7.14 Conduct of Business.............................................120
7.15 Amendments or Waivers of Related Agreements.....................120
7.16 Fiscal Year.....................................................120
7.17 Pompeii Mexico..................................................120
Section 8. EVENTS OF DEFAULT...............................................120
8.1 Failure to Make Payments When Due...............................120
8.2 Default in Other Agreements.....................................121
8.3 Breach of Certain Covenants.....................................121
8.4 Breach of Warranty..............................................121
8.5 Other Defaults Under Loan Documents.............................121
8.6 Involuntary Bankruptcy;
Appointment of Receiver, etc....................................121
8.7 Voluntary Bankruptcy;
Appointment of Receiver, etc....................................122
8.8 Judgments and Attachments.......................................122
8.9 Dissolution.....................................................122
8.10 Employee Benefit Plans..........................................122
8.11 Change of Control...............................................123
8.12 Invalidity of Subsidiary Guaranty
or Holdings Guaranty; Failure of
Security; Repudiation of Obligations............................123
8.13 Material Adverse Effect.........................................123
8.14 Actions Relating to Certain Indebtedness........................123
8.15 Failure of Holdings to Own Borrower.............................124
8.16 Failure to Consummate the Merger
and the Acquisition.............................................124
Section 9. ADMINISTRATIVE AGENT............................................125
9.1 Appointment.....................................................125
9.2 Powers and Duties; General Immunity.............................126
9.3 Representations and Warranties;
No Responsibility For Appraisal of
Creditworthiness................................................128
9.4 Right to Indemnity..............................................128
9.5 Successor Administrative Agent and
Successor Swing Line Lender.....................................128
9.6 Collateral Documents and Guaranties.............................129
Section 10. MISCELLANEOUS...................................................130
10.1 Assignments and Participations in Loans.........................130
10.2 Expenses........................................................133
10.3 Indemnity.......................................................134
10.4 Set-Off; Security Interest in Deposit Accounts..................135
10.5 Ratable Sharing.................................................136
10.6 Amendments and Waivers..........................................136
10.7 Independence of Covenants.......................................139
10.8 Notices.........................................................139
10.9 Survival of Representations,
Warranties and Agreements.......................................139
10.10 Failure or Indulgence Not Waiver;
Remedies Cumulative.............................................139
10.11 Marshalling; Payments Set Aside.................................140
10.12 Severability....................................................140
10.13 Obligations Several;
Independent Nature of Lenders' Rights...........................140
10.14 Headings........................................................140
10.15 Applicable Law..................................................140
10.16 Successors and Assigns..........................................141
10.17 Consent to Jurisdiction and Service of Process..................141
10.18 Waiver of Jury Trial............................................142
10.19 Confidentiality.................................................142
10.20 Lead Arranger, Bookrunner,
Documentation Agent and Syndication Agent.......................143
10.21 Counterparts; Effectiveness.....................................143
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF BORROWING BASE CERTIFICATE
V FORM OF TERM LOAN NOTE
VI FORM OF REVOLVING NOTE
VII FORM OF SWING LINE NOTE
VIII FORM OF COMPLIANCE CERTIFICATE
IX FORM OF OPINION OF COUNSEL TO LOAN PARTIES
X FORM OF OPINION OF ADMINISTRATIVE AGENT'S COUNSEL
XI FORM OF ASSIGNMENT AGREEMENT
XII-A FORM OF BORROWER'S FINANCIAL CONDITION CERTIFICATE
XII-B FORM OF HOLDINGS' FINANCIAL CONDITION CERTIFICATE
XIII FORM OF SECURITY AGREEMENT
XIV FORM OF SUBSIDIARY GUARANTY
XV FORM OF COLLATERAL ACCESS AGREEMENT
XVI FORM OF MORTGAGE
XVII FORM OF HOLDINGS GUARANTY
SCHEDULES
1.1(a) INVENTORY LOCATIONS
1.1(b) DAILY AVERAGE AMOUNTS
4.1C CORPORATE AND CAPITAL STRUCTURE; OWNERSHIP; MANAGEMENT
4.1I Closing Date Mortgaged Properties
4.1K phase I reports
4.1y sales terms
5.1 SUBSIDIARIES OF BORROWER
5.5B REAL PROPERTY
5.5C INTELLECTUAL PROPERTY
5.6 LITIGATION
5.8 MATERIAL CONTRACTS
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
5.13 ENVIRONMENTAL MATTERS
6.10 DEPOSIT ACCOUNTS
6.14 OTHER POST CLOSING MATTERS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
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