SPORTS & RECREATION, INC.
EXHIBIT 10
BANK CREDIT AGREEMENT
AMENDED AND RESTATED
CREDIT AGREEMENT
among
SPORTS & RECREATION, INC.
as Borrower,
AND
THE SUBSIDIARIES OF SPORTS & RECREATION, INC.
as Guarantors,
AND
THE LENDERS IDENTIFIED HEREIN,
AND
XXXXXXX BANK OF TAMPA,
as Administrative Agent
AND
NATIONSBANK, N.A. (SOUTH),
as Documentation Agent
DATED AS OF JUNE 4, 1996
TABLE OF CONTENTS
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions............................................................. 1
1.2 Computation of Time Periods and Other Definitional Provisions.......... 20
1.3 Accounting Terms....................................................... 20
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans........................................................ 21
2.2 Letter of Credit Subfacility................................. ........ 23
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest............................................................... 28
3.2 Place and Manner of Payments........................................... 29
3.3 Prepayments............................................................ 29
3.4 Fees................................................................... 31
3.5 Payment in full at Maturity............................................ 31
3.6 Computations of Interest and Fees...................................... 32
3.7 Pro Rata Treatment..................................................... 32
3.8 Sharing of Payments.................................................... 33
3.9 Capital Adequacy....................................................... 34
3.10 Inability To Determine Interest Rate.................................. 34
3.11 Illegality............................................................ 35
3.12 Requirements of Law................................................... 35
3.13 Taxes................................................................. 36
3.14 Indemnity............................................................. 38
SECTION 4
GUARANTY
4.1 Guaranty of Payment.................................................... 39
4.2 Obligations Unconditional.............................................. 39
4.3 Modifications.......................................................... 40
4.4 Waiver of Rights....................................................... 40
4.5 Reinstatement.......................................................... 41
4.6 Remedies............................................................... 41
4.7 Limitation of Guaranty................................................. 41
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions..................................................... 42
5.2 Conditions to All Extensions of Credit................................. 46
SECTION 6
REPRESENTATIONS AND WARRANTIES
6.1 Financial Condition.................................................... 46
6.2 No Material Change..................................................... 47
6.3 Organization and Good Standing......................................... 47
6.4 Due Authorization...................................................... 47
6.5 No Conflicts........................................................... 47
6.6 Consents............................................................... 47
6.7 Enforceable Obligations................................................ 48
6.8 No Default............................................................. 48
6.9 Ownership.............................................................. 48
6.10 Indebtedness.......................................................... 48
6.11 Litigation............................................................ 48
6.12 Taxes................................................................. 48
6.13 Compliance with Law................................................... 48
6.14 ERISA................................................................. 48
6.15 Subsidiaries.......................................................... 50
6.16 Use of Proceeds; Margin Stock......................................... 50
6.17 Government Regulation................................................. 50
6.18 Environmental Matters................................................. 50
6.19 Intellectual Property................................................. 52
6.20 Solvency.............................................................. 52
6.21 Investments........................................................... 52
6.22 Location of Collateral................................................ 52
6.24 Licenses, etc......................................................... 52
6.25 No Burdensome Restrictions............................................ 53
6.26 Collateral Documents.................................................. 53
SECTION 7
AFFIRMATIVE COVENANTS
7.1 Information Covenants.................................................. 53
7.2 Financial Covenants.................................................... 57
7.3 Preservation of Existence and Franchises............................... 57
7.4 Books and Records...................................................... 57
7.5 Compliance with Law.................................................... 57
7.6 Payment of Taxes and Other Indebtedness................................ 58
7.7 Insurance.............................................................. 58
7.8 Maintenance of Property................................................ 59
7.9 Performance of Obligations............................................. 59
7.10 Collateral............................................................ 59
7.11 Use of Proceeds....................................................... 59
7.12 Audits/Inspections.................................................... 59
7.13 Additional Credit Parties............................................. 60
7.14 Interest Rate Protection Agreements................................... 60
SECTION 8
NEGATIVE COVENANTS
8.1 Indebtedness........................................................... 62
8.2 Liens.................................................................. 62
8.3 Nature of Business..................................................... 63
8.4 Consolidation and Merger............................................... 63
8.5 Sale or Lease of Assets................................................ 63
8.6 Sale Leasebacks........................................................ 64
8.7 Advances, Investments and Loans........................................ 64
8.8 Dividends.............................................................. 64
8.9 Transactions with Affiliates........................................... 64
8.10 Fiscal Year; Organizational Documents................................. 65
8.11 Subordinated Debt..................................................... 65
8.12 Limitations........................................................... 65
8.13 Negative Pledges...................................................... 65
8.14 Capital Expenditures.................................................. 65
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default...................................................... 65
9.2 Acceleration; Remedies................................................. 68
9.3 Allocation of Payments After Event of Default.......................... 69
SECTION 10
AGENCY PROVISIONS
10.1 Appointment........................................................... 70
10.2 Delegation of Duties.................................................. 71
10.3 Exculpatory Provisions................................................ 71
10.4 Reliance on Communications............................................ 71
10.5 Notice of Default..................................................... 72
10.6 Non-Reliance on Agents and Other Lenders.............................. 72
10.7 Indemnification....................................................... 72
10.8 Agents in Their Individual Capacity................................... 73
10.9 Successor Agent....................................................... 73
SECTION 11
MISCELLANEOUS
11.1 Notices............................................................... 73
11.2 Right of Set-Off...................................................... 73
11.3 Benefit of Agreement.................................................. 74
11.4 No Waiver; Remedies Cumulative........................................ 76
11.5 Payment of Expenses; Indemnification.................................. 76
11.6 Amendments, Waivers and Consents...................................... 77
11.7 Counterparts.......................................................... 78
11.8 Headings.............................................................. 78
11.9 Defaulting Lender..................................................... 78
11.10 Survival............................................................. 78
11.11 Governing Law; Jurisdiction.......................................... 78
11.12 Waiver of Jury Trial................................................. 79
11.13 Time................................................................. 79
11.14 Severability......................................................... 79
11.15 Entirety............................................................. 79
11.16 Binding Effect....................................................... 79
11.17 Confidentiality...................................................... 80
SCHEDULES
Schedule 1.1(a) Commitment Percentages
Schedule 1.1(b) Eligible Real Estate
Schedule 5.1(g) Mortgaged Properties and Leasehold Properties
Schedule 6.10 Indebtedness
Schedule 6.11 Litigation
Schedule 6.15 Subsidiaries
Schedule 6.18 Environmental Matters
Schedule 6.19 Intellectual Property
Schedule 6.22(a) Real Property Locations
Schedule 6.22(b) Personal Property Locations
Schedule 6.22(c) Chief Executive Offices
Schedule 7.7 Insurance
Schedule 8.2 Liens
Schedule 8.7 Investments
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Notice of Continuation/Conversion
Exhibit 2.1(g) Form of Revolving Loan Note
Exhibit 7.1(c) Form of Borrowing Base Certificate
Exhibit 7.1(d) Form of Officer's Certificate
Exhibit 7.13 Form of Joinder Agreement
Exhibit 11.3 Form of Assignment Agreement
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Credit Agreement"), is
entered into as of June 4, 1996 among SPORTS & RECREATION, INC., a Delaware
corporation ("Borrower"), each of Borrower's Subsidiaries (individually a
"Guarantor" and collectively the "Guarantors"), the Lenders (as defined herein),
XXXXXXX BANK OF TAMPA, as Administrative Agent for the Lenders and NATIONSBANK,
N.A. (SOUTH), as Documentation Agent for the Lenders.
RECITALS
WHEREAS, Borrower is currently a party to that certain Credit Agreement,
dated as of November 10, 1994, between the Borrower, the lenders named therein,
Xxxxxxx Bank of Tampa, as Managing Agent and L/C Issuer and NationsBank of
Florida, National Association as Documentation Agent and Co-Managing Agent (as
amended, the "Existing Credit Agreement");
WHEREAS, Borrower is currently a party to that certain Participation
Agreement, dated as of May 10, 1995, among the Borrower as Construction Agent
and as Lessee, First Security Bank of Utah, N.A., as Owner Trustee, NationsBank
of Florida, N.A., as a holder and NationsBank of Florida, N.A. as Administrative
Agent for the Lenders (such agreement, together with the other documents and
instruments executed and delivered in connection therewith, the "Existing
TROL");
WHEREAS, Borrower wishes to terminate the Existing Credit Agreement and the
Existing TROL and instead enter into a $285 million revolving credit facility;
and
WHEREAS, the Lenders party hereto have agreed to make the requested
revolving credit facility available to the Borrower on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions. As used herein, the following terms shall have the
meanings herein specified unless the context otherwise requires. Defined terms
herein shall include in the singular number the plural and in the plural the
singular:
"Additional Credit Party" means each Person that becomes a Guarantor after
the Closing Date, as provided in Section 7.13.
"Adjusted Base Rate" means the Base Rate plus the Applicable Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the Applicable
Percentage.
"Administrative Agent" means Xxxxxxx Bank of Tampa (or any successor
thereto) or any successor administrative agent appointed pursuant to Section
10.9.
"Agents" mean the Administrative Agent, the Documentation Agent and the
Collateral Agent and any successors and assigns in such capacity.
"Affiliate" means, with respect to any Person, any other Person directly or
indirectly controlling (including but not limited to all directors and officers
of such Person), controlled by or under direct or indirect common control with
such Person. A Person shall be deemed to control a corporation if such Person
possesses, directly or indirectly, the power (i) to vote 10% or more of the
securities having ordinary voting power for the election of directors of such
corporation or (ii) to direct or cause direction of the management and policies
of such corporation, whether through the ownership of voting securities, by
contract or otherwise.
"Applicable Percentage" means the appropriate applicable percentages
corresponding to the Senior Debt to Capitalization Ratio in effect as of the
most recent Calculation Date as shown below:
Applicable Applicable Applicable Percentage
Pricing Senior Debt to Percentage For Percentage For For Letter of
Level Capitalization Eurodollar Loans Base Rate Loans Credit Fee
======= --------------- ----------------- ---------------- ===================
I #.35 to 1.0 1.25% .25% 1.25%
======= --------------- ----------------- ---------------- ====================
II #.40 to 1.0 but 1.50% .50% 1.50%
> .35 to 1.0
======= --------------- ----------------- ---------------- ====================
III #.45 to 1.0 but 1.75% .75% 1.75%
> .40 to 1.0
======= --------------- ----------------- ---------------- ====================
IV #.50 to 1.0 but 2.00% 1.00% 2.00%
> .45 to 1.0
======= --------------- ----------------- ---------------- ====================
V #.55 to 1.0 but 2.25% 1.25% 2.25%
> .50 to 1.0
======= =============== ================= ================ ====================
VI > .55 to 1.0 2.50% 1.50% 2.50%
======= =============== ================= ================ ====================
The Applicable Percentage for Revolving Loans and the Letter of Credit Fee
shall, in each case, be determined and adjusted quarterly on the date (each a
"Calculation Date") five Business Days after the date by which the Borrower is
required to provide the officer's certificate in accordance with the provisions
of Section 7.1(d); provided that the initial Applicable Percentage for Revolving
Loans and the Letter of Credit Fee shall be based on Pricing Level IV (as shown
above) and shall remain at Pricing Level IV until the first Calculation Date
subsequent to the Closing Date and, thereafter, the Pricing Level shall be
determined by the then current Senior Debt to Capitalization Ratio; and provided
further that once during each fiscal year the Borrower shall have the right to
provide an officer's certificate with the delivery of its monthly financial
statements pursuant to Section 7.1(c) (the "Extra Calculation Date") and the
Applicable Percentage for Revolving Loans and Letter of Credit Fee shall adjust
on such Extra Calculation Date; and provided further that if the Borrower fails
to provide the officer's certificate required by Section 7.1(d) on or before the
most recent Calculation Date, the Applicable Percentage for Revolving Loans and
the Letter of Credit Fee from such Calculation Date shall be based on Pricing
Level VI until such time that an appropriate officer's certificate is provided
whereupon the Pricing Level shall be determined by the then current Senior Debt
to Capitalization Ratio. Each Applicable Percentage shall be effective from one
Calculation Date until the next Calculation Date (or, if applicable, from the
Extra Calculation Date to the next Calculation Date). Any adjustment in the
Applicable Percentage shall be applicable to all existing Loans and Letters of
Credit as well as any new Loans made or Letters of Credit issued.
"Asset Disposition" means the disposition of any or all of the assets (or
the sale of the stock of a Subsidiary) of the Borrower or any of its
Subsidiaries whether by sale, lease, transfer or otherwise unless permitted by
the terms of Section 8.5(a), (b) and (c).
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Base Rate" means, for any day, the rate per annum (rounded upwards, if
necessary, to the nearest whole multiple of 1/100 of 1%) equal to the greater of
(a) the Federal Funds Rate in effect on such day plus 2 of 1% or (b) the Prime
Rate in effect on such day. If for any reason the Administrative Agent shall
have determined (which determination shall be conclusive absent manifest error)
that it is unable after due inquiry to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms hereof, the Base Rate shall
be determined without regard to clause (a) of the first sentence of this
definition until the circumstances giving rise to such inability no longer
exist. Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such change in
the Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate determined by
reference to the Base Rate.
"Borrower" means Sports & Recreation, Inc., a Delaware corporation,
together with any successors and permitted assigns.
"Borrowing Base Assets" means, at any date of determination, the sum of (a)
55% of Eligible Inventory plus (b) 65% of Eligible Real Estate plus (c) 55% of
Eligible Equipment.
"Business Day" means any day other than a Saturday, a Sunday, a legal
holiday or a day on which banking institutions are authorized or required by law
or other governmental action to close in Tampa, Florida, Charlotte, North
Carolina or New York, New York; provided that in the case of Eurodollar Loans,
such day is also a day on which dealings between banks are carried on in U.S.
dollar deposits in the London interbank market.
"Calculation Date" has the meaning set forth in the definition of
Applicable Percentage.
"Capital Expenditures" means all expenditures of the Credit Parties and
their Subsidiaries which, in accordance with GAAP, would be classified as
capital expenditures, including, without limitation, Capital Leases.
"Capital Lease" means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in accordance
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person.
"Capitalization" means the sum of (a) Senior Debt plus (b) Subordinated
Debt plus (c) stockholders equity of the Borrower and its Subsidiaries, on a
consolidated basis, as determined in accordance with GAAP.
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. dollar denominated
time and demand deposits and certificates of deposit of (i) any Lender, (ii) any
domestic commercial bank having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Xxxxx'x is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (d) repurchase agreements with a bank or
trust company (including any of the Lenders) or securities dealer having capital
and surplus in excess of $500,000,000 for direct obligations issued by or fully
guaranteed by the United States of America in which the Borrower shall have a
perfected first priority security interest (subject to no other Liens) and
having, on the date of purchase thereof, a fair market value of at least 100% of
the amount of the repurchase obligations and (e) Investments, classified in
accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are
administered by financial institutions having capital of at least $500,000,000
and the portfolios of which are limited to Investments of the character
described in the foregoing subdivisions (a) through (d).
"Cash Flow Coverage Ratio" means the ratio of (a) EBITDAR to (b) the sum of
(i) Rent Expense plus (ii) Interest Expense plus (iii) Scheduled Funded Debt
Payments.
"Change of Control" means either of the following events: (a) any "person"
or "group" (within the meaning of Section 13(d) or 14(d) of the Exchange Act)
has become, directly or indirectly, the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that a Person shall be deemed to
have "beneficial ownership" of all shares that any such Person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time), by way of merger, consolidation or otherwise, of 30% or more of the
voting power of the Voting Stock of the Borrower on a fully-diluted basis, after
giving effect to the conversion and exercise of all outstanding warrants,
options and other securities of the Borrower (whether or not such securities are
then currently convertible or exercisable) or (b) a change in control (as
defined in the Indenture) occurs.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986 and the rules and
regulations promulgated thereunder, as amended, modified, succeeded or replaced
from time to time.
"Collateral" means all collateral referred to in and covered by the
Collateral Documents.
"Collateral Agent" means Xxxxxxx Bank of Tampa (or any successor thereto)
or any successor collateral agent appointed pursuant to Section 10.9.
"Collateral Documents" means the Security Agreements, the Pledge
Agreements, the Mortgage Documents and such other documents executed and
delivered in connection with the attachment and perfection of the Lenders'
security interests in the assets of the Credit Parties, including without
limitation, the Mortgage Policies, UCC financing statements and trademark
filings.
"Commitment Fees" means the fees payable to the Lenders pursuant to Section
3.4(a).
"Commitment Fee Percentage" means (a) if the Senior Debt to Capitalization
Ratio is less than or equal to .45 to 1.0, .375% per annum or (b) if the Senior
Debt to Capitalization Ratio is greater than .45 to 1.0, .50% per annum.
"Commitments" means the commitment of each Lender with respect to the
Revolving Committed Amount.
"Credit Documents" means this Credit Agreement, the Notes, any Joinder
Agreement, the Collateral Documents, the LOC Documents, the Fee Letter and all
other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto.
"Credit Parties" means the Borrower and the Guarantors and "Credit Party"
means any one of them.
"Credit Party Obligations" means, without duplication, (a) all of the
obligations of the Credit Parties to the Lenders (including the Issuing Lender)
and the Agents, whenever arising, under this Credit Agreement, the Notes, the
Collateral Documents or any of the other Credit Documents to which the Borrower
or any other Credit Party is a party and (b) all liabilities and obligations
owing from such Credit Party to any Lender, or any Affiliate of a Lender,
arising under interest rate protection agreements, foreign currency exchange
agreements, commodity purchase or option agreements or other interest or
exchange rate or commodity price hedging agreements (collectively, "Hedging
Agreements").
"Debt Issuance" means the issuance of any Indebtedness for borrowed money
by a Credit Party or any of its Subsidiaries, other than Indebtedness permitted
by Section 8.1.
"Default" means any event, act or condition which with notice or lapse of
time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, (a) has failed to
make a Loan or purchase a Participation Interest required pursuant to the terms
of this Credit Agreement (but only for so long as such Loan is not made or such
Participation Interest is not purchased), (b) has failed to pay to the Agents or
any Lender an amount owed by such Lender pursuant to the terms of this Credit
Agreement (but only for so long as such amount has not been repaid) or (c) has
been deemed insolvent or has become subject to a bankruptcy or insolvency
proceeding or to a receiver, trustee or similar official.
"Documentation Agent" means NationsBank, N.A. (South) (or any successor
thereto) or any successor documentation agent appointed pursuant to Section
10.9.
"Dollars" and "$" means dollars in lawful currency of the United States of
America.
"EBITDA" means, for any period, with respect to the Credit Parties and
their Subsidiaries on a consolidated basis, the sum of (a) Net Income for such
period (excluding the effect of any extraordinary or other non-recurring gains
(including any gain from the sale of property) or non-cash losses (including
one-time restructuring charges taken not later than the second fiscal quarter of
1996 and not to exceed $55 million) outside of the ordinary course of business)
plus (b) an amount which, in the determination of Net Income for such period has
been deducted for (i) Interest Expense for such period, (ii) total Federal,
state, foreign or other income taxes for such period and (iii) all depreciation
and amortization for such period, all as determined in accordance with GAAP.
"EBITDAR" means, for any period, the sum of EBITDA for such period plus an
amount which in the determination of Net Income for such period has been
deducted for Rent Expense for such period, all as determined in accordance with
GAAP.
"Effective Date" means the date, as specified by the Documentation Agent in
writing, on which the conditions set forth in Section 5.1 shall have been
fulfilled (or waived in the sole discretion of the Lenders) and on which the
initial Loans shall have been made and/or the initial Letters of Credit shall
have been issued.
"Eligible Assignee" means (a) any Lender or Affiliate or subsidiary of a
Lender and (b) any other commercial bank, financial institution, institutional
lender or "accredited investor" (as defined in Regulation D of the Securities
and Exchange Commission) with capital of at least $500 million and with an
office in the United States.
"Eligible Equipment" means, as of any date of determination, the book value
of all equipment, furniture and fixtures owned by any Credit Party but excluding
any such equipment, furniture or fixtures (i) subject to a Lien other than any
Lien described in clauses (a) through (d) of the definition of Permitted Liens,
(ii) not useable or saleable at prices approximating their book value in the
ordinary course of business, (iii) located outside of the United States, (iv)
located at a location not owned or leased by a Credit Party, (v) located at a
location leased by the applicable Credit Party with respect to which the
Collateral Agent shall not have received a landlord's waiver reasonably
satisfactory to the Collateral Agent within 90 days from the Closing Date and
(vi) which fails to meet such other specifications and requirements as may from
time to time be established by the Collateral Agent in its reasonable
discretion.
"Eligible Inventory" means, as of any date of determination and without
duplication, the lower of the aggregate book value (based on a FIFO or a moving
average cost valuation, consistently applied) or fair market value of all raw
materials and finished goods inventory owned by any Credit Party less
appropriate reserves determined in accordance with GAAP, but excluding in any
event (i) inventory subject to any Lien, other than any Lien described in
clauses (a) through (d) of the definition of Permitted Lien, (ii) inventory
which is not in good condition or fails to meet standards for sale or use
imposed by governmental agencies, departments or divisions having regulatory
authority over such goods, (iii) inventory which is not useable or saleable at
prices approximating their cost in the ordinary course of the applicable Credit
Party's business (including without duplication the amount of any reserves for
obsolescence, unsalability or decline in value), (iv) inventory located outside
of the United States, (v) inventory located at a location not owned or leased by
the applicable Credit Party, (vi) inventory located at a location leased by the
applicable Credit Party with respect to which the Collateral Agent shall not
have received a landlord's waiver reasonably satisfactory to the Collateral
Agent within 90 days from the Closing Date, (vii) inventory which is leased or
on consignment and (viii) inventory which fails to meet such other
specifications and requirements as may from time to time be established by the
Collateral Agent in its reasonable discretion; it being agreed that the value of
Eligible Inventory shall not include any capitalized procurement costs.
"Eligible Real Estate" means, as of any date of determination, (a) (i) from
the Closing Date until 90 days subsequent to the Closing Date, the value of the
real property set forth on Schedule 1.1(b) (the net book value except for such
properties where a market valuation is listed) and (ii) from the date 91 days
subsequent to the Closing Date and thereafter, the value attributed to each
parcel of real property set forth on a revised Schedule 1.1(b) to be prepared by
the Agents as described below plus (b) the market value of any other real
property hereafter acquired by a Credit Party in which the Lenders have a first
priority perfected Lien minus (c) the value attributed to any real property set
forth on Schedule 1.1(b) that is sold or otherwise transferred by a Credit
Party. The Agents shall prepare and deliver a revised Schedule 1.1(b) on the
date 90 days after the Closing Date which shall include valuations for each
parcel of real property (such valuations shall be based on valuations performed
in connection with this transaction and to the extent such valuations are
provided to the Agents in a range the Agents shall use the average of the high
and low numbers of such range in preparing the revised Schedule 1.1(b)) and
which shall omit any parcel of real estate in which the Agents have not received
a title policy reasonably acceptable to them (including, but not limited to,
failure to receive acceptable endorsements as to surveys, mechanic liens, etc.).
The Borrower shall provide to the Agents a revised updated Schedule 1.1(b) to
the Agents each time a parcel of real estate on Schedule 1.1(b) is sold or a
parcel of real estate is purchased and a first priority perfected Lien on such
real estate has been granted to the Lenders.
"Environmental Claim" means any investigation, written notice, violation,
written demand, written allegation, action, suit, injunction, judgment, order,
consent decree, penalty, fine, lien, proceeding, or written claim whether
administrative, judicial, or private in nature arising (a) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental Law, (b)
in connection with any Hazardous Material, (c) from any assessment, abatement,
removal, remedial, corrective, or other response action in connection with an
Environmental Law or other order of a Governmental Authority or (d) from any
actual or alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.
"Environmental Laws" means any current or future legal requirement of any
Governmental Authority pertaining to (a) the protection of health, safety, and
the indoor or outdoor environment, (b) the conservation, management, or use of
natural resources and wildlife, (c) the protection or use of surface water and
groundwater or (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure to, any
hazardous or toxic substance or material or (e) pollution (including any release
to land surface water and groundwater) and includes, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 USC
9601 et seq., Solid Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act of 1976 and Hazardous and Solid Waste Amendment of 1984, 42 USC
6901 et seq., Federal Water Pollution Control Act, as amended by the Clean Water
Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as amended, 42 USC 7401
et seq., Toxic Substances Control Act of 1976, 15 USC 2601 et seq., Hazardous
Materials Transportation Act, 49 USC App. 1801 et seq., Occupational Safety and
Health Act of 1970, as amended, 29 USC 651 et seq., Oil Pollution Act of 1990,
33 USC 2701 et seq., Emergency Planning and Community Right-to-Know Act of 1986,
42 USC 11001 et seq., National Environmental Policy Act of 1969, 42 USC 4321 et
seq., Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et seq., any
analogous implementing or successor law, and any amendment, rule, regulation,
order, or directive issued thereunder.
"Equity Issuance" means any issuance by the Borrower to any Person (other
than a member of senior management of the Borrower) of (a) shares of its capital
stock or other equity interests, (b) any shares of its capital stock or other
equity interests pursuant to the exercise of options or warrants or (c) any
shares of its capital stock or other equity interests pursuant to the conversion
of any debt securities to equity.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity, whether or not incorporated, which is
under common control with any Credit Party or any of its Subsidiaries within the
meaning of Section 4001(a)(14) of ERISA, or is a member of a group which
includes any Credit Party or any of its Subsidiaries and which is treated as a
single employer under Sections 414(b), (c), (m), or (o) of the Code.
"Eurodollar Loan" means a Loan bearing interest based at a rate determined
by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar Loan
comprising part of the same borrowing (including conversions, extensions and
renewals), a per annum interest rate determined pursuant to the following
formula:
Eurodollar Rate = London Interbank Offered Rate
---------------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under Regulation D
of the Board of Governors of the Federal Reserve System (or any successor), as
such regulation may be amended from time to time or any successor regulation, as
the maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurocurrency liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate of Eurodollar Loans is determined), whether or not Lender has
any Eurocurrency liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities and as
such shall be deemed subject to reserve requirements without benefits of credits
for proration, exceptions or offsets that may be available from time to time to
a Lender. The Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Eurodollar Reserve Percentage.
"Event of Default" means any of the events or circumstances described in
Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder, as amended, modified,
succeeded or replaced from time to time.
"Existing Letters of Credit" means those letters of credit issued under the
Existing Credit Agreement that are outstanding on the Effective Date.
"Extension of Credit" means, as to any Lender, the making of a Loan by such
Lender (or a participation therein by a Lender) or the issuance of, or
participation in, a Letter of Credit by such Lender.
"Federal Funds Rate" means for any day the rate per annum (rounded upward,
if necessary, to the nearest 1/100th of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day and (b) if no such rate is so published on such next preceding
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Agent on such day on such transactions as
determined by the Administrative Agent.
"Fee Letter" means that certain letter agreement, dated as of April 19,
1996, between the Agents and the Borrower, as amended, modified, supplemented or
replaced from time to time.
"Funded Debt" means, without duplication, the sum of (a) all Indebtedness
of the Credit Parties and their Subsidiaries for borrowed money, (b) all
purchase money Indebtedness of the Credit Parties and their Subsidiaries, (c)
the principal portion of all obligations of the Borrower and its Subsidiaries
under Capital Leases, (d) all obligations, contingent or otherwise, relative to
the face amount of all letters of credit (other than letters of credit
supporting trade payables in the ordinary course of business), whether or not
drawn, and banker's acceptances issued for the account of such Person (it being
understood that, to the extent an undrawn letter of credit supports another
obligation consisting of Indebtedness, in calculating aggregated Indebtedness
only such other obligation shall be included), (e) all Guaranty Obligations of
the Credit Parties and their Subsidiaries with respect to Funded Debt of another
Person, (f) all Funded Debt of another entity secured by a Lien on any property
of the Credit Parties and their Subsidiaries whether or not such Funded Debt has
been assumed by a Credit Party or any of its Subsidiaries, (g) all Funded Debt
of any partnership or unincorporated joint venture to the extent a Credit Party
or one of its Subsidiaries is legally obligated or has a reasonable expectation
of being liable with respect thereto, net of any assets of such partnership or
joint venture and (h) the principal balance outstanding under any synthetic
lease, tax retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product where such transaction is considered
borrowed money indebtedness for tax purposes but is classified as an operating
lease in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the United States
applied on a consistent basis and subject to Section 0.
"Governmental Authority" means any Federal, state, local, provincial or
foreign court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantor" means each of the Subsidiaries of the Borrower and each
Additional Credit Party which has executed a Joinder Agreement, together with
their successors and assigns.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing or
intended to guarantee any Indebtedness of any other Person in any manner,
whether direct or indirect, and including without limitation any obligation,
whether or not contingent, (a) to purchase any such Indebtedness or other
obligation or any property constituting security therefor, (b) to advance or
provide funds or other support for the payment or purchase of such indebtedness
or obligation or to maintain working capital, solvency or other balance sheet
condition of such other Person (including, without limitation, maintenance
agreements, comfort letters, take or pay arrangements, put agreements or similar
agreements or arrangements) for the benefit of the holder of Indebtedness of
such other Person, (c) to lease or purchase property, securities or services
primarily for the purpose of assuring the owner of such Indebtedness or (d) to
otherwise assure or hold harmless the owner of such Indebtedness or obligation
against loss in respect thereof. The amount of any Guaranty Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Guaranty Obligation is
made.
"Hazardous Materials" means any substance, material or waste defined or
regulated in or under any Environmental Laws.
"Hedging Agreements" has the meaning set forth in the definition of Credit
Party Obligations.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made (c) all obligations of such Person
under conditional sale or other title retention agreements relating to property
purchased by such Person to the extent of the value of such property (other than
customary reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (d) all obligations, other
than intercompany items, of such Person issued or assumed as the deferred
purchase price of property or services purchased by such Person which would
appear as liabilities on a balance sheet of such Person, (e) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (f) all
Guaranty Obligations of such Person, (g) the principal portion of all
obligations of such Person under (i) Capital Leases and (ii) any synthetic
lease, tax retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product of such Person where such transaction is
considered borrowed money indebtedness for tax purposes but is classified as an
operating lease in accordance with GAAP, (h) all obligations of such Person in
respect of interest rate protection agreements, foreign currency exchange
agreements, or other interest or exchange rate or commodity price hedging
agreements, (i) the maximum amount of all performance and standby letters of
credit issued or bankers' acceptances facilities created for the account of such
Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (j) all preferred stock issued by such Person and required by the
terms thereof to be redeemed, or for which mandatory sinking fund payments are
due, by a fixed date and (k) the aggregate amount of uncollected accounts
receivable of such Person subject at such time to a sale of receivables (or
similar transaction) regardless of whether such transaction is effected without
recourse to such Person or in a manner that would not be reflected on the
balance sheet of such Person in accordance with GAAP. The Indebtedness of any
Person shall include the Indebtedness of any partnership or unincorporated joint
venture in which such Person is legally obligated or has a reasonable
expectation of being liable with respect thereto.
"Indenture" means that certain Indenture, dated as of November 4, 1993,
among Sports & Recreation, Inc. as issuer, and Xxxxxxx Xxxxx Trust Company,
National Association, as trustee, as the same may be modified, supplemented or
amended from time to time.
"Interest Expense" means, for any period, with respect to the Credit
Parties and their Subsidiaries on a consolidated basis, all net interest
expense, including the interest component under Capital Leases, as determined in
accordance with GAAP.
"Interest Payment Date" means (a) as to Base Rate Loans, each January 1,
April 1, July 1 and October 1 and on the Revolving Loan Maturity Date and (b) as
to Eurodollar Loans, on the last day of each applicable Interest Period and on
the Revolving Loan Maturity Date and in addition where the applicable Interest
Period for a Eurodollar Loan is greater than three months, then also on the date
three months from the beginning of the Interest Period and each three months
thereafter.
"Interest Period" means, as to Eurodollar Loans, a period of one, two,
three or six months' duration, as the Borrower may elect, commencing, in each
case, on the date of the borrowing (including continuations and conversions
thereof); provided, however, (a) if any Interest Period would end on a day which
is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day), (b) no Interest Period shall extend beyond the Revolving Loan Maturity
Date and (c) where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the Interest Period
is to end, such Interest Period shall end on the last Business Day of such
calendar month.
"Investment" in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise) of
assets, shares of capital stock, bonds, notes, debentures, partnership, joint
ventures or other ownership interests or other securities of such other Person
or (b) any deposit with, or advance, loan or other extension of credit to, such
Person (other than deposits made in connection with the purchase of equipment or
other assets in the ordinary course of business) or (c) any other capital
contribution to or investment in such Person, including, without limitation, any
Guaranty Obligation (including any support for a Letter of Credit issued on
behalf of such Person) incurred for the benefit of such Person.
"Issuing Lender" means Xxxxxxx Bank of Tampa.
"Issuing Lender Fees" has the meaning set forth in Section 3.4(b).
"Joinder Agreement" means a Joinder Agreement substantially in the form of
Exhibit 7.13.
"Leasehold Mortgaged Properties" has the meaning set forth in Section
5.1(h).
"Leasehold Mortgages" has the meaning set forth in Section 5.1(h).
"Lender" means any of the Persons identified as a "Lender" on the signature
pages hereto, and any Person which may become a Lender by way of assignment in
accordance with the terms hereof, together with their successors and permitted
assigns.
"Letter of Credit" means a Letter of Credit issued for the account of a
Credit Party by the Issuing Lender pursuant to Section 2.2, as such Letter of
Credit may be amended, modified, extended, renewed or replaced.
"Letter of Credit Fee" shall have the meaning assigned to such term in
Section 3.4(b).
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind, including, without limitation, any
agreement to give any of the foregoing, any conditional sale or other title
retention agreement, and any lease in the nature thereof.
"Loan" or "Loans" means the Revolving Loans (or a portion of any Revolving
Loan), individually or collectively, as appropriate.
"LOC Documents" means, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any documents delivered in connection therewith,
any application therefor, and any agreements, instruments, guarantees or other
documents (whether general in application or applicable only to such Letter of
Credit) governing or providing for (a) the rights and obligations of the parties
concerned or at risk or (b) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (a) the maximum amount
which is, or at any time thereafter may become, available to be drawn under
Letters of Credit then outstanding, assuming compliance with all requirements
for drawings referred to in such Letters of Credit plus (b) the aggregate amount
of all drawings under Letters of Credit honored by an Issuing Lender but not
theretofore reimbursed.
"LOC Participants" means the Lenders.
"London Interbank Offered Rate" means, with respect to any Eurodollar Loan
for the Interest Period applicable thereto, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Telerate Page 3750 (or any successor page) as the London interbank offered rate
for deposits in Dollars at approximately 11:00 A.M. (London time) two Business
Days prior to the first day of such Interest Period for a term comparable to
such Interest Period; provided, however, if more than one rate is specified on
Telerate Page 3750, the applicable rate shall be the arithmetic mean of all such
rates. If, for any reason, such rate is not available, the term "London
Interbank Offered Rate" shall mean, with respect to any Eurodollar Loan for the
Interest Period applicable thereto, the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBO Page as the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Reuters Screen LIBO Page, the
applicable rate shall be the arithmetic mean of all such rates.
"Mandatory Borrowing" has the meaning set forth in Section 2.2(e).
"Material Adverse Effect" means a material adverse effect on (a) the
operations, financial condition, business or prospects of the Credit Parties and
their Subsidiaries taken as a whole, (b) the ability of a Credit Party to
perform its respective obligations under this Credit Agreement or any of the
other Credit Documents, or (c) the validity or enforceability of this Credit
Agreement, any of the other Credit Documents, or the rights and remedies of the
Lenders hereunder or thereunder taken as a whole.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Mortgage Documents" means the Mortgages and the Leasehold Mortgages, the
Mortgage Policies and such other documents and agreements executed or delivered
in connection with the Real Properties.
"Mortgage Policies" has the meaning set forth in Section 5.1(h).
"Mortgages" has the meaning set forth in Section 5.1(h).
"Mortgaged Properties" has the meaning set forth in Section 5.1(h).
"Multiemployer Plan" means a Plan covered by Title IV of ERISA which is a
multiemployer plan as defined in Section 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan covered by Title IV of ERISA, other
than a Multiemployer Plan, which any Credit Party or any of its Subsidiaries or
any ERISA Affiliate and at least one employer other than a Credit Party or any
of its Subsidiaries or any ERISA Affiliate are contributing sponsors.
"Net Cash Proceeds" means the gross cash proceeds (including cash actually
received (but only when received) by way of deferred payment pursuant to a
promissory note, receivable, or otherwise) received from an Asset Disposition,
an Equity Issuance or a Debt Issuance net of (a) transaction costs payable to
third parties and (b) a good faith estimate of the taxes payable with respect to
such proceeds, including, without duplication, withholding taxes and any taxes
payable to a third party in connection with distribution of such proceeds from a
Subsidiary of the Borrower to the Borrower.
"Net Income" means, for any period, the net income after taxes for such
period of the Credit Parties and their Subsidiaries on a consolidated basis, as
determined in accordance with GAAP.
"Net Worth" means, as of any date, shareholders' equity or net worth of the
Credit Parties and their Subsidiaries on a consolidated basis, as determined in
accordance with GAAP.
"Non-Excluded Taxes" has the meaning set forth in Section 3.13.
"Note" or "Notes" means the Revolving Loan Notes, individually or
collectively, as appropriate.
"Notice of Borrowing" means a request by the Borrower for a Revolving Loan,
in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the Borrower to
continue an existing Eurodollar Loan to a new Interest Period or to convert a
Eurodollar Loan to a Base Rate Loan or a Base Rate Loan to a Eurodollar Loan, in
the form of Exhibit 2.1(e).
"Operating Lease" means, as to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in accordance
with GAAP, is or should be accounted for as an operating lease.
"Participation Interest" means the Extension of Credit by a Lender by way
of a purchase of a participation in Letters of Credit or LOC Obligations as
provided in Section 2.2 or in any Loans as provided in Section 3.8.
"PBGC" means the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA and any successor thereto.
"Permitted Investments" means Investments which are (a) cash or Cash
Equivalents, (b) accounts receivable created, acquired or made in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms, (c) inventory, raw materials and general intangibles (to the extent
such general intangible is not a Capital Expenditure) acquired in the ordinary
course of business, (d) Investments by one Credit Party in another Credit Party,
(e) loans to directors, officers or employees in the ordinary course of business
for reasonable business expenses, not to exceed in the aggregate $500,000 at any
one time; provided that no such loan may remain outstanding for longer than 18
months, (f) loans to executive management of the Borrower to purchase stock of
the Borrower up to $1,000,000 in the aggregate at any one time, (g) the
Investments set forth on Schedule 8.7, (h) Investments in Capital Expenditures
to the extent permitted by Section 8.14 and (i) inventory acquired in the
ordinary course of business.
"Permitted Liens" means (a) Liens securing Credit Party Obligations, (b)
Liens for taxes not yet due or Liens for taxes being contested in good faith by
appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof),
(c) Liens in respect of property imposed by law arising in the ordinary course
of business such as materialmen's, mechanics', warehousemen's, carrier's,
landlords' and other nonconsensual statutory Liens which are not yet due and
payable or which are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof), (d) pledges or
deposits made in the ordinary course of business to secure payment of worker's
compensation insurance, unemployment insurance, pensions or social security
programs, (e) Liens arising from good faith deposits in connection with or to
secure performance of tenders, bids, leases, government contracts, performance
and return-of-money bonds and other similar obligations incurred in the ordinary
course of business (other than obligations in respect of the payment of borrowed
money), (f) Liens arising from good faith deposits in connection with or to
secure performance of statutory obligations and surety and appeal bonds, (g)
easements, rights-of-way, restrictions (including zoning restrictions), matters
of plat, minor defects or irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use of the encumbered
property for its intended purposes, (h) judgment Liens that would not constitute
an Event of Default, (i) Liens in connection with Indebtedness allowed under
Section 8.1(f), (j) Liens arising by virtue of any statutory or common law
provision relating to banker's liens, rights of setoff or similar rights as to
deposit accounts or other funds maintained with a creditor depository
institution, (k) Liens existing on the date hereof and identified on Schedule
8.2; provided that no such Lien shall extend to any property other than the
property subject thereto on the Closing Date and (l) Permitted Encumbrances (as
defined in any Mortgage Document).
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated), or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which any Credit Party or
any of its Subsidiaries or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreements" means any Pledge Agreement executed and delivered by a
Credit Party in favor of the Collateral Agent, for the benefit of the Lenders,
to secure its obligations under the Credit Documents, as amended, modified,
extended, renewed or replaced from time to time.
"Prime Rate" means the per annum rate of interest established from time to
time by the Administrative Agent at its principal office in Tampa, Florida (or
such other principal office of the Administrative Agent as communicated in
writing to the Borrower and the Lenders) as its Prime Rate. Any change in the
interest rate resulting from a change in the Prime Rate shall become effective
as of 12:01 a.m. of the Business Day on which each change in the Prime Rate is
announced by the Administrative Agent. The Prime Rate is a reference rate used
by the Administrative Agent in determining interest rates on certain loans and
is not intended to be the lowest rate of interest charged on any extension of
credit to any debtor.
"Real Properties" means the Mortgaged Properties and the Leasehold
Mortgaged Properties.
"Regulation D, G, U, or X" means Regulation D, G, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Rent Expense" means, for any period, with respect to the Credit Parties
and their Subsidiaries on a consolidated basis, all rent payable under Operating
Leases, as determined in accordance with GAAP.
"Reportable Event" means a "reportable event" as defined in Section 4043 of
ERISA with respect to which the notice requirements to the PBGC have not been
waived.
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes at least 66 2/3% of the Credit Exposure of all
Lenders at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders the aggregate principal amount of Credit
Exposure of such Lender at such time. For purposes of the preceding sentence,
the term "Credit Exposure" as applied to each Lender shall mean (a) at any time
prior to the termination of the Commitments, the sum of the Revolving Commitment
Percentage of such Lender multiplied by the Revolving Committed Amount and (b)
at any time after the termination of the Commitments, the sum of (i) the
principal balance of the outstanding Loans of such Lender plus (ii) such
Lender's Participation Interests in the face amount of the outstanding Letters
of Credit.
"Requirement of Law" means, as to any Person, the articles or certificate
of incorporation and by-laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or final, non-appealable
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or to which any of its
material property is subject.
"Revolving Loan Commitment Percentage" means, for each Lender, the
percentage identified as its Revolving Commitment Percentage on Schedule 1.1(a),
as such percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 11.3.
"Revolving Committed Amount" means TWO HUNDRED EIGHTY FIVE MILLION DOLLARS
($285,000,000) or such lesser amount as the Revolving Committed Amount may be
reduced pursuant to Section 2.1(d) or Section 3.3(c).
"Revolving Loan Maturity Date" means June 4, 1998.
"Revolving Loans" means the Revolving Loans made to the Borrower pursuant
to Section 2.1.
"Revolving Note" or "Revolving Notes" means the promissory notes of the
Borrower in favor of each of the Lenders evidencing the Revolving Loans provided
pursuant to Section 2.1, individually or collectively, as appropriate, as such
promissory notes may be amended, modified, supplemented, extended, renewed or
replaced from time to time and as evidenced in the form of Exhibit 2.1(g).
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"Scheduled Funded Debt Payments" means, as of the date of determination,
for the Credit Parties and their Subsidiaries on a consolidated basis, the sum
of all scheduled payments of principal and any required prepayments on Funded
Debt for the applicable period ending on the date of determination (including
the principal component of payments due on Capital Leases during the applicable
period ending on the date of determination), excluding any payments due at
maturity with respect to Indebtedness permitted by Section 8.1(c) to the extent
such Indebtedness has been refinanced.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Security Agreements" means any security agreement executed and delivered
by a Credit Party in favor of the Collateral Agent for the benefit of the
Lenders to secure its obligations under the Credit Documents, as such may be
amended, modified, extended, renewed, restated or replaced from time to time.
"Senior Debt" means all Funded Debt other than the Subordinated Debt.
"Senior Debt to Capitalization Ratio" means the ratio of (a) Senior Debt to
(b) Capitalization.
"Single Employer Plan" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Person as of a particular date, that
on such date (a) such Person is able to pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the normal course
of business, (b) such Person does not intend to, and does not believe that it
will, incur debts or liabilities beyond such Person's ability to pay as such
debts and liabilities mature in their ordinary course, (c) such Person is not
engaged in a business or a transaction, and is not about to engage in a business
or a transaction, for which such Person's assets would constitute unreasonably
small capital after giving due consideration to the prevailing practice in the
industry in which such Person is engaged or is to engage, (d) the fair value of
the assets of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person and (e)
the present fair saleable value of the assets of such Person is not less than
the amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured. In computing the amount of
contingent liabilities at any time, it is intended that such liabilities will be
computed at the amount which, in light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"Subordinated Debt" means the $74,750,000 of Indebtedness evidenced by the
Indenture.
"Subsidiary" means, as to any Person, (a) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting
power to elect a majority of the directors of such corporation (irrespective of
whether or not at the time, any class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time owned by such Person directly or indirectly through Subsidiaries, and
(b) any partnership, association, joint venture or other entity in which such
person directly or indirectly through Subsidiaries has more than a 50% equity
interest at any time.
"Termination Event" means (a) with respect to any Single Employer Plan, the
occurrence of a Reportable Event or the substantial cessation of operations
(within the meaning of Section 4062(e) of ERISA); (b) the withdrawal of any
Credit Party or any of its Subsidiaries or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as such
term is defined in Section 4001(a)(2) of ERISA), or the termination of a
Multiple Employer Plan; (c) the distribution of a notice of intent to terminate
or the actual termination of a Plan pursuant to Section 4041(a)(2) or 4041A of
ERISA; (d) the institution of proceedings to terminate or the actual termination
of a Plan by the PBGC under Section 4042 of ERISA; (e) any event or condition
which might reasonably constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan; or (f)
the complete or partial withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiemployer Plan.
"Unused Commitment" means, for any period, the amount by which (a) the then
applicable aggregate Revolving Committed Amount exceeds (b) the daily average
sum for such period of the outstanding aggregate principal amount of all
Revolving Loans plus the aggregate amount of LOC Obligations outstanding.
"Voting Stock" of a corporation means all classes of the capital stock of
such corporation then outstanding and normally entitled to vote in the election
of directors.
1.2 Computation of Time Periods and Other Definitional Provisions. For
purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding." References in this Agreement to "Articles", "Sections", "Schedules"
or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits of or to
this Agreement unless otherwise specifically provided.
1.3 Accounting Terms. Except as otherwise expressly provided herein, all
accounting terms used herein shall be interpreted, and all financial statements
and certificates and reports as to financial matters required to be delivered to
the Lenders hereunder shall be prepared, in accordance with GAAP applied on a
consistent basis. All financial statements delivered to the Lenders hereunder
shall be accompanied by a statement from the Borrower that GAAP has not changed
since the most recent financial statements delivered by the Borrower to the
Lenders or if GAAP has changed describing such changes in detail and explaining
how such changes affect the financial statements. All calculations made for the
purposes of determining compliance with this Credit Agreement shall (except as
otherwise expressly provided herein) be made by application of GAAP applied on a
basis consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 7.1 (or, prior to the delivery of the first
financial statements pursuant to Section 7.1, consistent with the financial
statements described in Section 5.1(c)); provided, however, if (a) the Borrower
shall object to determining such compliance on such basis at the time of
delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) either Agent or the Required Lenders
shall so object in writing within 60 days after delivery of such financial
statements (or after the Lenders have been informed of the change in GAAP
affecting such financial statements, if later), then such calculations shall be
made on a basis consistent with the most recent financial statements delivered
by the Borrower to the Lenders as to which no such objection shall have been
made.
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans.
(a) Revolving Loan Commitment. Subject to the terms and conditions set
forth herein, each Lender severally agrees to make revolving loans (each a
"Revolving Loan" and collectively the "Revolving Loans") to the Borrower, in
Dollars, at any time and from time to time, during the period from and including
the Effective Date to but not including the Revolving Loan Maturity Date (or
such earlier date if the Revolving Committed Amount has been terminated as
provided herein); provided, however, that (i) the sum of the aggregate amount of
Revolving Loans outstanding plus the aggregate amount of LOC Obligations
outstanding shall not exceed the lesser of (x) the Revolving Committed Amount
and (y) the Borrowing Base Assets and (ii) with respect to each individual
Lender, the Lender's pro rata share of outstanding Revolving Loans plus such
Lender's pro rata share of outstanding LOC Obligations shall not exceed such
Lender's Revolving Loan Commitment Percentage of the Revolving Committed Amount.
Subject to the terms of this Credit Agreement (including Section 3.3), the
Borrower may borrow, repay and reborrow Revolving Loans.
(b) Method of Borrowing for Revolving Loans. By no later than 11:00 a.m.
(i) on the date of the requested borrowing of Revolving Loans that will be Base
Rate Loans or (ii) three Business Days prior to the date of the requested
borrowing of Revolving Loans that will be Eurodollar Loans, the Borrower shall
submit a written Notice of Borrowing in the form of Exhibit 2.1(b) to the
Administrative Agent setting forth (A) the amount requested, (B) whether such
Revolving Loans shall accrue interest at the Adjusted Base Rate or the Adjusted
Eurodollar Rate, (C) with respect to Revolving Loans that will be Eurodollar
Loans, the Interest Period applicable thereto and (D) certification that the
Borrower has complied in all respects with Section 5.2;
(c) Funding of Revolving Loans. Upon receipt of a Notice of Borrowing, the
Administrative Agent shall promptly inform the Lenders as to the terms thereof.
Each Lender shall make its Revolving Loan Commitment Percentage of the requested
Revolving Loans available to the Administrative Agent by 1:00 p.m. on the date
specified in the Notice of Borrowing by deposit, in Dollars, of immediately
available funds at the offices of the Administrative Agent at its principal
office in Tampa, Florida or at such other address as the Administrative Agent
may designate in writing. The amount of the requested Revolving Loans will then
be made available to the Borrower by the Administrative Agent by crediting the
account of the Borrower on the books of such office of the Administrative Agent,
to the extent the amount of such Revolving Loans are made available to the
Administrative Agent.
No Lender shall be responsible for the failure or delay by any other Lender
in its obligation to make Revolving Loans hereunder; provided, however, that the
failure of any Lender to fulfill its obligations hereunder shall not relieve any
other Lender of its obligations hereunder. Unless the Administrative Agent shall
have been notified by any Lender prior to the date of any such Revolving Loan
that such Lender does not intend to make available to the Administrative Agent
its portion of the Revolving Loans to be made on such date, the Administrative
Agent may assume that such Lender has made such amount available to the
Administrative Agent on the date of such Revolving Loans, and the Administrative
Agent in reliance upon such assumption, may (in its sole discretion but without
any obligation to do so) make available to the Borrower a corresponding amount.
If such corresponding amount is not in fact made available to the Administrative
Agent, the Administrative Agent shall be able to recover such corresponding
amount from such Lender. If such Lender does not pay such corresponding amount
forthwith upon the Administrative Agent's demand therefor, the Administrative
Agent will promptly notify the Borrower, and the Borrower shall immediately pay
such corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover from the Lender or the Borrower, as the case
may be, interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative Agent to
the Borrower to the date such corresponding amount is recovered by the
Administrative Agent at a per annum rate equal to (i) from the Borrower at the
applicable rate for such Revolving Loan pursuant to the Notice of Borrowing and
(ii) from a Lender at the Federal Funds Rate.
(d) Reductions of Revolving Committed Amount. Upon at least three Business
Days' notice, the Borrower shall have the right to permanently terminate or
reduce the aggregate unused amount of the Revolving Committed Amount at any time
or from time to time; provided that (i) each partial reduction shall be in an
aggregate amount at least equal to $5,000,000 and in integral multiples of
$1,000,000 above such amount and (ii) no reduction shall be made which would
reduce the Revolving Committed Amount to an amount less than the aggregate
amount of outstanding Revolving Loans plus the aggregate amount of outstanding
LOC Obligations. Any reduction in (or termination of) the Revolving Committed
Amount shall be permanent and may not be reinstated. The Administrative Agent
shall immediately notify the Lenders of any reduction in the Revolving Committed
Amount.
(e) Continuations and Conversions. Subject to the terms of Section 5.2, the
Borrower shall have the option, on any Business Day, to continue existing
Eurodollar Loans for a subsequent Interest Period, to convert Base Rate Loans
into Eurodollar Loans or to convert Eurodollar Loans into Base Rate Loans;
provided, however, that (i) each such continuation or conversion must be
requested by the Borrower pursuant to a written Notice of
Continuation/Conversion, in the form of Exhibit 2.1(e), in compliance with the
terms set forth below, (ii) except as provided in Section 3.11, Eurodollar Loans
may only be continued or converted into Base Rate Loans on the last day of the
Interest Period applicable thereto, (iii) Eurodollar Loans may not be continued
nor may Base Rate Loans be converted into Eurodollar Loans during the existence
and continuation of a Default or Event of Default and (iv) any request to
continue a Eurodollar Loan that fails to comply with the terms hereof or any
failure to request a continuation of a Eurodollar Loan at the end of an Interest
Period shall constitute a conversion to a Base Rate Loan on the last day of the
applicable Interest Period. Each continuation or conversion must be requested by
the Borrower no later than 11:00 a.m. (A) on the date for a requested conversion
of a Eurodollar Loan to a Base Rate Loan or (B) three Business Days prior to the
date for a requested continuation of a Eurodollar Loan or conversion of a Base
Rate Loan to a Eurodollar Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which shall set
forth (x) whether the Borrower wishes to continue or convert such Loans and (y)
if the request is to continue a Eurodollar Loan or convert a Base Rate Loan to a
Eurodollar Loan, the Interest Period applicable thereto.
(f) Minimum Amounts. Each request for a borrowing, conversion or
continuation shall be subject to the requirements that (i) each Eurodollar Loan
shall be in a minimum amount of $5,000,000 and in integral multiples of
$1,000,000 in excess thereof, (ii) each Base Rate Loan shall be in a minimum
amount of the lesser of $250,000 (and integral multiples of $50,000 in excess
thereof) or the remaining amount available under the Revolving Committed Amount
and (iii) no more than six Eurodollar Loans shall be outstanding hereunder at
any one time. For the purposes of this Section, all Eurodollar Loans with the
same Interest Periods shall be considered as one Eurodollar Loan, but Eurodollar
Loans with different Interest Periods, even if they begin on the same date,
shall be considered as separate Eurodollar Loans.
(g) Notes. The Revolving Loans made by each Lender shall be evidenced by a
duly executed promissory note of the Borrower to each applicable Lender in the
face amount of its Revolving Loan Commitment Percentage of the Revolving
Committed Amount in substantially the form of Exhibit 2.1(g).
2.2 Letter of Credit Subfacility.facility.
(a) Issuance. Subject to the terms and conditions hereof and of the LOC
Documents, if any, and any other terms and conditions which the Issuing Lender
may reasonably require (so long as such terms and conditions do not impose any
financial obligation on or require any Lien (not otherwise contemplated by this
Agreement) to be given by any Credit Party or conflict with any obligation of,
or detract from any action which may be taken by, any Credit Party or their
Subsidiaries under this Agreement), the Issuing Lender shall from time to time
upon request issue (from the Effective Date to the Revolving Loan Maturity Date
and in a form reasonably acceptable to the Issuing Lender), in Dollars, and the
LOC Participants shall participate in, letters of credit (the "Letters of
Credit") for the account of the Borrower or any of its Subsidiaries; provided,
however, that (i) the aggregate amount of LOC Obligations shall not at any time
exceed TEN MILLION DOLLARS ($10,000,000), (ii) the sum of the aggregate amount
of LOC Obligations outstanding plus Revolving Loans outstanding shall not exceed
the Revolving Committed Amount and (iii) with respect to each individual LOC
Participant, the LOC Participant's pro rata share of outstanding Revolving Loans
plus its pro rata share of outstanding LOC Obligations shall not exceed such LOC
Participant's Revolving Loan Commitment Percentage of the Revolving Committed
Amount. The issuance and expiry date of each Letter of Credit shall be a
Business Day. Except as otherwise expressly agreed upon by all the LOC
Participants, no Letter of Credit shall have an original expiry date more than
one year from the date of issuance, or as extended, shall have an expiry date
extending beyond the Revolving Loan Maturity Date. Each Letter of Credit shall
be either (x) a standby letter of credit issued to support the obligations
(including pension or insurance obligations), contingent or otherwise, of the
Borrower or any of its Subsidiaries, or (y) a commercial letter of credit in
respect of the purchase of goods or services by the Borrower or any of its
Subsidiaries in the ordinary course of business. Each Letter of Credit shall
comply with the related LOC Documents.
(b) Notice and Reports. The request for the issuance of a Letter of Credit
shall be submitted to the Issuing Lender at least three Business Days prior to
the requested date of issuance. The Issuing Lender will, at least quarterly and
more frequently upon request, provide to the Administrative Agent for
dissemination to the Lenders a detailed report specifying the Letters of Credit
which are then issued and outstanding and any activity with respect thereto
which may have occurred since the date of the prior report, and including
therein, among other things, the account party, the beneficiary, the face
amount, and the expiry date as well as any payments or expirations which may
have occurred. The Issuing Lender will further provide to the Administrative
Agent, promptly upon request, copies of the Letters of Credit and the other LOC
Documents.
(c) Participations.
(i) On the Effective Date, each LOC Participant shall automatically
acquire a participation in the liability of the Issuing Lender under each
Existing Letter of Credit in an amount equal to its Revolving Loan
Commitment Percentage of such Existing Letters of Credit. Each Existing
Letter of Credit shall be deemed for all purposes of this Credit Agreement
and the other Credit Documents to be a Letter of Credit.
(ii) Each LOC Participant, upon issuance of a Letter of Credit, shall
be deemed to have purchased without recourse a risk participation from the
Issuing Lender in such Letter of Credit and each LOC Document related
thereto and the rights and obligations arising thereunder and any
collateral relating thereto, in each case in an amount equal to its
Revolving Loan Commitment Percentage of the obligations under such Letter
of Credit, and shall absolutely, unconditionally and irrevocably assume, as
primary obligor and not as surety, and be obligated to pay to the Issuing
Lender therefor and discharge when due, its Revolving Loan Commitment
Percentage of the obligations arising under such Letter of Credit. Without
limiting the scope and nature of each LOC Participant's participation in
any Letter of Credit, to the extent that the Issuing Lender has not been
reimbursed as required hereunder or under any such Letter of Credit, each
such LOC Participant shall pay to the Issuing Lender its Revolving Loan
Commitment Percentage of such unreimbursed drawing in same day funds on the
day of notification by the Issuing Lender of an unreimbursed drawing
pursuant to the provisions of subsection (d) hereof. The obligation of each
LOC Participant to so reimburse the Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a Default, an
Event of Default or any other occurrence or event. Any such reimbursement
shall not relieve or otherwise impair the obligation of the Borrower or any
other Credit Party to reimburse the Issuing Lender under any Letter of
Credit, together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of Credit,
the Issuing Lender will promptly notify the Borrower. Unless the Borrower shall
immediately notify the Issuing Lender of its intent to otherwise reimburse the
Issuing Lender, the Borrower shall be deemed to have requested a Revolving Loan
at the Adjusted Base Rate in the amount of the drawing as provided in subsection
(e) hereof, the proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower shall reimburse the Issuing Lender on the day of
drawing under any Letter of Credit either with the proceeds of a Revolving Loan
obtained hereunder or otherwise in same day funds as provided herein or in the
LOC Documents. If the Borrower shall fail to reimburse the Issuing Lender as
provided hereinabove, the unreimbursed amount of such drawing shall bear
interest at a per annum rate equal to the Base Rate plus the Applicable
Percentage for the Base Rate Loans that are Revolving Loans plus two percent
(2%). The Borrower's reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of (but without waiver of)
any rights of set-off, counterclaim or defense to payment the applicable account
party or the Borrower may claim or have against the Issuing Lender, the Agent,
the Lenders, the beneficiary of the Letter of Credit drawn upon or any other
Person, including without limitation, any defense based on any failure of the
applicable account party, the Borrower or any other Credit Party to receive
consideration or the legality, validity, regularity or unenforceability of the
Letter of Credit. The Issuing Lender will promptly notify the LOC Participants
of the amount of any unreimbursed drawing and each LOC Participant shall
promptly pay to the Administrative Agent for the account of the Issuing Lender,
in Dollars and in immediately available funds, the amount of such LOC
Participant's Revolving Loan Commitment Percentage of such unreimbursed drawing.
Such payment shall be made on the day such notice is received by such Lender
from the Issuing Lender if such notice is received at or before 2:00 p.m.,
otherwise such payment shall be made at or before 12:00 Noon on the Business Day
next succeeding the day such notice is received. If such LOC Participant does
not pay such amount to the Issuing Lender in full upon such request, such LOC
Participant shall, on demand, pay to the Administrative Agent for the account of
the Issuing Lender interest on the unpaid amount during the period from the date
the LOC Participant received the notice regarding the unreimbursed drawing until
such LOC Participant pays such amount to the Issuing Lender in full at a rate
per annum equal to, if paid within two Business Days of the date of drawing, the
Federal Funds Rate and thereafter at a rate equal to the Base Rate. Each LOC
Participant's obligation to make such payment to the Issuing Lender, and the
right of the Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and without
regard to the termination of this Credit Agreement or the Commitments hereunder,
the existence of a Default or Event of Default or the acceleration of the
obligations hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever. Simultaneously with the making of each such
payment by a LOC Participant to the Issuing Lender, such LOC Participant shall,
automatically and without any further action on the part of the Issuing Lender
or such LOC Participant, acquire a participation in an amount equal to such
payment (excluding the portion of such payment constituting interest owing to
the Issuing Lender) in the related unreimbursed drawing portion of the LOC
Obligation and in the interest thereon and in the related LOC Documents, and
shall have a claim against the Borrower and the other Credit Parties with
respect thereto.
(e) Repayment with Revolving Loans. On any day on which the Borrower shall
have requested, or been deemed to have requested, a Revolving Loan borrowing to
reimburse a drawing under a Letter of Credit, the Administrative Agent shall
give notice to the applicable Lenders that a Revolving Loan has been requested
or deemed requested in connection with a drawing under a Letter of Credit, in
which case a Revolving Loan borrowing comprised solely of Base Rate Loans (each
such borrowing, a "Mandatory Borrowing") shall be immediately made from all
applicable Lenders (without giving effect to any termination of the Commitments
pursuant to Section 9.2) pro rata based on each Lender's respective Revolving
Loan Commitment Percentage and the proceeds thereof shall be paid directly to
the Issuing Lender for application to the respective LOC Obligations. Each such
Lender hereby irrevocably agrees to make such Revolving Loans immediately upon
any such request or deemed request on account of each such Mandatory Borrowing
in the amount and in the manner specified in the preceding sentence and on the
same such date notwithstanding (i) the amount of Mandatory Borrowing may not
comply with the minimum amount for borrowings of Revolving Loans otherwise
required hereunder, (ii) whether any conditions specified in Section 5 are then
satisfied, (iii) whether a Default or Event of Default then exists, (iv) failure
of any such request or deemed request for Revolving Loans to be made by the time
otherwise required hereunder, (v) the date of such Mandatory Borrowing, or (vi)
any reduction in the Revolving Committed Amount or any termination of the
Commitments. In the event that any Mandatory Borrowing cannot for any reason be
made on the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the Bankruptcy Code with
respect to the Borrower or any other Credit Party), then each such Lender hereby
agrees that it shall forthwith fund (as of the date the Mandatory Borrowing
would otherwise have occurred, but adjusted for any payments received from the
Borrower on or after such date and prior to such purchase) its Participation
Interest in the outstanding LOC Obligations; provided, further, that in the
event any Lender shall fail to fund its Participation Interest on the day the
Mandatory Borrowing would otherwise have occurred, then the amount of such
Lender's unfunded Participation Interest therein shall bear interest payable to
the Issuing Lender upon demand, at the rate equal to, if paid within two
Business Days of such date, the Federal Funds Rate, and thereafter at a rate
equal to the Base Rate.
(f) Modification and Extension. The issuance of any supplement,
modification, amendment, renewal, or extensions to any Letter of Credit shall,
for purposes hereof, be treated in all respects the same as the issuance of a
new Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Issuing Lender may have the Letters
of Credit be subject to The Uniform Customs and Practice for Documentary
Credits, as published as of the date of issue by the International Chamber of
Commerce (Publication No. 500 or the most recent publication, the "UCP"), in
which case the UCP may be incorporated therein and deemed in all respects to be
a part thereof.
(h) Responsibility of Issuing Lender. It is expressly understood and agreed
as between the Lenders that the obligations of the Issuing Lender hereunder to
the LOC Participants are only those expressly set forth in this Credit Agreement
and that the Issuing Lender shall be entitled to assume that the conditions
precedent set forth in Section 5 have been satisfied unless it shall have
acquired actual knowledge that any such condition precedent has not been
satisfied; provided, however, that nothing set forth in this Section 2.2 shall
be deemed to prejudice the right of any LOC Participant to recover from the
Issuing Lender any amounts made available by such LOC Participant to the Issuing
Lender pursuant to this Section 2.2 in the event that it is determined by a
court of competent jurisdiction that the payment with respect to a Letter of
Credit constituted gross negligence or willful misconduct on the part of the
Issuing Lender.
(i) Conflict with LOC Documents. In the event of any conflict between this
Credit Agreement and any LOC Document, this Credit Agreement shall govern.
(j) Indemnification of Issuing Lender.
(i) In addition to its other obligations under this Credit Agreement,
the Borrower hereby agrees to protect, indemnify, pay and save the Issuing
Lender harmless from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any Letter of
Credit or (B) the failure of the Issuing Lender to honor a drawing under a
Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein called
"Government Acts").
(ii) As between the Borrower and the Issuing Lender, the Borrower
shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. The Issuing Lender shall not be
responsible for (except in the case of (A), (B) and (C) below if the
Issuing Lender has actual knowledge to the contrary): (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
issuance of any Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or
forged; (B) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part,
that may prove to be invalid or ineffective for any reason; (C) failure of
the beneficiary of a Letter of Credit to comply fully with conditions
required in order to draw upon a Letter of Credit; (D) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex or otherwise, whether or not they be in
cipher; (E) errors in interpretation of technical terms; (F) any loss or
delay in the transmission or otherwise of any document required in order to
make a drawing under a Letter of Credit or of the proceeds thereof; and (G)
any consequences arising from causes beyond the control of the Issuing
Lender, including, without limitation, any Government Acts. None of the
above shall affect, impair, or prevent the vesting of the Issuing Lender's
rights or powers hereunder.
(iii) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender, under or in connection with any Letter of Credit or the
related certificates, if taken or omitted in good faith, shall not put the
Issuing Lender under any resulting liability to the Borrower or any other
Credit Party. It is the intention of the parties that this Credit Agreement
shall be construed and applied to protect and indemnify the Issuing Lender
against any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower, including,
without limitation, any and all risks of the acts or omissions, whether
rightful or wrongful, of any present or future Government Acts. The Issuing
Lender shall not, in any way, be liable for any failure by the Issuing
Lender or anyone else to pay any drawing under any Letter of Credit as a
result of any Government Acts or any other cause beyond the control of the
Issuing Lender.
(iv) Nothing in this subsection (j) is intended to limit the
reimbursement obligation of the Borrower contained in this Section 2.2. The
obligations of the Borrower under this subsection (j) shall survive the
termination of this Credit Agreement. No act or omission of any current or
prior beneficiary of a Letter of Credit shall in any way affect or impair
the rights of the Issuing Lender to enforce any right, power or benefit
under this Credit Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (j), the Borrower shall have no obligation to indemnify the
Issuing Lender in respect of any liability incurred by the Issuing Lender
arising solely out of the gross negligence or willful misconduct of the
Issuing Lender, as determined by a court of competent jurisdiction. Nothing
in this Agreement shall relieve the Issuing Lender of any liability to the
Borrower in respect of any action taken by the Issuing Lender which action
constitutes gross negligence or willful misconduct of the Issuing Lender or
a violation of the UCP or Uniform Commercial Code (as applicable), as
determined by a court of competent jurisdiction.
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest.
(a) Interest Rate. All Base Rate Loans shall accrue interest at the
Adjusted Base Rate and all Eurodollar Loans shall accrue interest at the
Adjusted Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during the
continuance, of an Event of Default, the principal of and, to the extent
permitted by law, interest on the Loans and any other amounts owing
hereunder or under the other Credit Documents (including without limitation
fees and expenses) shall bear interest, payable on demand, at a per annum
rate equal to 2% plus the rate which would otherwise be applicable (or if
no rate is applicable, then the rate for Revolving Loans that are Base Rate
Loans plus two percent (2%) per annum).
(c) Interest Payments. Interest on Loans shall be due and payable in
arrears on each Interest Payment Date. If an Interest Payment Date falls on
a date which is not a Business Day, such Interest Payment Date shall be
deemed to be the next succeeding Business Day, except that in the case of
Eurodollar Loans where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding day.
3.2 Place and Manner of Payments. All payments of principal, interest,
fees, expenses and other amounts to be made by a Credit Party under this
Agreement shall be received not later than 2:00 p.m. on the date when due, in
Dollars and in immediately available funds, by the Administrative Agent at its
offices in Tampa, Florida. Payments received after such time shall be deemed to
have been received on the next Business Day. The Borrower shall, at the time it
makes any payment under this Agreement, specify to the Administrative Agent, the
Loans, Letters of Credit, fees or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and in the event that it fails
to specify, or if such application would be inconsistent with the terms hereof,
the Administrative Agent shall, subject to Section 3.7, distribute such payment
to the Lenders in such manner as the Administrative Agent may deem appropriate).
The Administrative Agent will distribute such payments to the applicable Lenders
if any such payment is received prior to 2:00 p.m.; otherwise the Administrative
Agent will distribute such payment to the applicable Lenders on the next
succeeding Business Day. Whenever any payment hereunder shall be stated to be
due on a day which is not a Business Day, the due date thereof shall be extended
to the next succeeding Business Day (subject to accrual of interest and fees for
the period of such extension), except that in the case of Eurodollar Loans, if
the extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right to prepay
Loans in whole or in part from time to time without premium or penalty;
provided, however, that (i) Eurodollar Loans may only be prepaid on three
Business Days' prior written notice to the Administrative Agent and any
prepayment of Eurodollar Loans will be subject to Section 3.14 and (ii)
each such partial prepayment of Loans shall be in the minimum principal
amount of $5,000,000 and integral multiples of $1,000,000 in excess
thereof.
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time the sum of the
aggregate amount of Revolving Loans outstanding plus LOC
Obligations outstanding exceeds the lesser of (x) the Revolving
Committed Amount and (y) the Borrowing Base Assets, the Borrower
shall immediately make a principal payment to the Administrative
Agent in the manner and in an amount necessary to be in
compliance with Section 2.1.
(ii) Asset Dispositions. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Asset
Disposition, the Borrower shall forward 100% of the Net Cash
Proceeds of such Asset Disposition to the Lenders as a prepayment
of the Loans (to be applied as set forth in Section 3.3(c)
below).
(iii) Issuances of Debt. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Debt
Issuance, the Borrower shall forward 100% of the Net Cash
Proceeds of such Debt Issuance to the Lenders as a prepayment of
the Loans (to be applied as set forth in Section 3.3(c) below).
(iv) Issuances of Equity. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Equity
Issuance, the Borrower shall forward 100% of the Net Cash
Proceeds of such Equity Issuance to the Lenders as a prepayment
of the Loans (to be applied as set forth in Section 3.3(c)
below).
(c) Application of Prepayments. All amounts required to be paid
pursuant to Section 3.3(b)(i) shall be applied first to Revolving Loans and
second to a cash collateral account in respect of LOC Obligations. All
amounts required to be paid pursuant to Section 3.3(b)(ii) shall be applied
first to Revolving Loans (with a reduction in the Revolving Committed
Amount of 100% of such amounts which, in total, exceed $10,000,000 during
the term of this Credit Agreement) and second, to a cash collateral account
in respect of LOC Obligations. All amounts required to be paid pursuant to
Section 3.3(b)(iii) shall be applied first to Revolving Loans (with a
corresponding reduction in the Revolving Committed Amount) and second to a
cash collateral account in respect of LOC Obligations. All amounts required
to be paid pursuant to Section 3.3(b)(iv) shall be applied first to
Revolving Loans (with a reduction in the Revolving Committed Amount of 50%
of such amounts) and second to a cash collateral account in respect of LOC
Obligations. Any permanent reductions in the Revolving Committed Amount
pursuant to this Section 3.3(c) shall occur solely in multiples of
$1,000,000. Within the parameters of the application set forth above,
prepayments shall be applied first to Base Rate Loans and then to
Eurodollar Loans in direct order of Interest Period maturities. All
prepayments hereunder shall be subject to Section 3.14.
3.4 Fees.
(a) Commitment Fees. In consideration of the Revolving Committed Amount
being made available by the Lenders hereunder, the Borrower agrees to pay to the
Administrative Agent, for the pro rata benefit of each applicable Lender (based
on each Lender's Revolving Loan Commitment Percentage of the Revolving Committed
Amount), a fee equal to the Commitment Fee Percentage on the Unused Commitment
(the "Commitment Fees"). The accrued Commitment Fees shall commence to accrue on
the Effective Date and shall be due and payable in arrears on each January 1,
April 1, July 1 and October 1 (as well as on the Revolving Loan Maturity Date
and on any date that the Revolving Committed Amount is reduced) for the
immediately preceding fiscal quarter (or portion thereof), beginning with the
first of such dates to occur after the Closing Date.
(b) Letter of Credit Fees.
(i) Letter of Credit Fee. In consideration of the issuance of Letters
of Credit hereunder, the Borrower agrees to pay to the Issuing Lender for
the pro rata benefit of the applicable Lenders (based on each Lender's
Revolving Loan Commitment Percentage of the Revolving Committed Amount), a
fee (the "Letter of Credit Fee") equal to the Applicable Percentage for the
Letter of Credit Fee on the average daily maximum amount available to be
drawn under each such Letter of Credit from the date of issuance to the
date of expiration. The Letter of Credit Fee will be payable in arrears on
each January 1, April 1, July 1 and October 1 (as well as on the Revolving
Loan Maturity Date) for the immediately preceding fiscal quarter (or
portion thereof), beginning with the first of such dates to occur after the
Closing Date.
(ii) Issuing Lender Fees. In addition to the Letter of Credit Fees
payable pursuant to subsection (i) above, the Borrower shall pay to the
Issuing Lender for its own account, without sharing by the other Lenders,
(A) a fee equal to one-fourth of one percent (.25%) per annum on the total
sum of all Letters of Credit issued by the Issuing Lender, such fee to be
paid quarterly in arrears 15 days after the end of each fiscal quarter of
the Borrower (as well as on the Revolving Loan Maturity Date) and (B) the
customary charges from time to time to the Issuing Lender for its services
in connection with the issuance, amendment, payment, transfer,
administration, cancellation and conversion of, and drawings under, such
Letters of Credit (collectively, the "Issuing Lender Fees").
(c) Administrative Fees. The Borrower agrees to pay to the Administrative
Agent, for its own account, an annual fee as agreed to between the Borrower and
the Administrative Agent in the Fee Letter.
3.5 Payment in full at Maturity. On the Revolving Loan Maturity Date, the
entire outstanding principal balance of all Revolving Loans and all LOC
Obligations, together with accrued but unpaid interest and all other sums owing
with respect thereto, shall be due and payable in full, unless accelerated
sooner pursuant to Section 9.
3.6 Computations of Interest and Fees.
(a) All computations of interest and fees hereunder shall be made on the
basis of the actual number of days elapsed over a year of 360 days. Interest
shall accrue from and include the date of borrowing (or continuation or
conversion) but exclude the date of payment.
(b) It is the intent of the Lenders and the Credit Parties to conform to
and contract in strict compliance with applicable usury law from time to time in
effect. All agreements between the Lenders and the Borrower are hereby limited
by the provisions of this paragraph which shall override and control all such
agreements, whether now existing or hereafter arising and whether written or
oral. In no way, nor in any event or contingency (including but not limited to
prepayment or acceleration of the maturity of any obligation), shall the
interest taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious amount
permissible under applicable law. If, from any possible construction of any of
the Credit Documents or any other document, interest would otherwise be payable
in excess of the maximum nonusurious amount, any such construction shall be
subject to the provisions of this paragraph and such documents shall be
automatically reduced to the maximum nonusurious amount permitted under
applicable law, without the necessity of execution of any amendment or new
document. If any Lender shall ever receive anything of value which is
characterized as interest on the Loans under applicable law and which would,
apart from this provision, be in excess of the maximum lawful amount, an amount
equal to the amount which would have been excessive interest shall, without
penalty, be applied to the reduction of the principal amount owing on the Loans
and not to the payment of interest, or refunded to the Borrower or the other
payor thereof if and to the extent such amount which would have been excessive
exceeds such unpaid principal amount of the Loans. The right to demand payment
of the Loans or any other indebtedness evidenced by any of the Credit Documents
does not include the right to receive any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to charge or
receive any unearned interest in the event of such demand. All interest paid or
agreed to be paid to the Lenders with respect to the Loans shall, to the extent
3
permitted by applicable law, be amortized, prorated, allocated, and spread
throughout the full stated term (including any renewal or extension) of the
Loans so that the amount of interest on account of such indebtedness does not
exceed the maximum nonusurious amount permitted by applicable law.
3.7 Pro Rata Treatment. Except to the extent otherwise provided herein:
(a) Loans. Each Revolving Loan borrowing (including, without limitation,
each Mandatory Borrowing), each payment or prepayment of principal of any Loan,
each payment of fees (other than the Issuing Lender Fees retained by the Issuing
Lender for its own account and the Administrative Fees retained by the
Administrative Agent for its own account), each reduction of the Revolving
Committed Amount, and each conversion or continuation of any Loan, shall (except
as otherwise provided in Section 3.11) be allocated pro rata among the relevant
Lenders in accordance with the respective Revolving Loan Commitment Percentages
of such Lenders (or, if the Commitments of such Lenders have expired or been
terminated, in accordance with the respective principal amounts of the
outstanding Loans and Participation Interests of such Lenders); provided that,
if any Lender shall have failed to pay its applicable pro rata share of any
Revolving Loan, then any amount to which such Lender would otherwise be entitled
pursuant to this subsection (a) shall instead be payable to the Administrative
Agent until the share of such Loan not funded by such Lender has been repaid;
provided further, that in the event any amount paid to any Lender pursuant to
this subsection (a) is rescinded or must otherwise be returned by the
Administrative Agent, each Lender shall, upon the request of the Administrative
Agent, repay to the Administrative Agent the amount so paid to such Lender, with
interest for the period commencing on the date such payment is returned by the
Administrative Agent until the date the Administrative Agent receives such
repayment at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and
thereafter, the Base Rate plus two percent (2%) per annum; and
(b) Letters of Credit. Each payment of unreimbursed drawings in respect of
LOC Obligations shall be allocated to each LOC Participant pro rata in
accordance with its Revolving Loan Commitment Percentage; provided that, if any
LOC Participant shall have failed to pay its applicable pro rata share of any
drawing under any Letter of Credit, then any amount to which such LOC
Participant would otherwise be entitled pursuant to this subsection (b) shall
instead be payable to the Issuing Lender until the share of such unreimbursed
drawing not funded by such Lender has been repaid; provided further, that in the
event any amount paid to any LOC Participant pursuant to this subsection (b) is
rescinded or must otherwise be returned by the Issuing Lender, each LOC
Participant shall, upon the request of the Issuing Lender, repay to the
Administrative Agent for the account of the Issuing Lender the amount so paid to
such LOC Participant, with interest for the period commencing on the date such
payment is returned by the Issuing Lender until the date the Issuing Lender
receives such repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal Funds Rate,
and thereafter, the Base Rate plus two percent (2%) per annum.
3.8 Sharing of Payments. The Lenders agree among themselves that, except to
the extent otherwise provided herein, in the event that any Lender shall obtain
payment in respect of any Loan, unreimbursed drawing with respect to any LOC
Obligations or any other obligation owing to such Lender under this Credit
Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
shall promptly pay in cash or purchase from the other Lenders a participation in
such Loans, LOC Obligations, and other obligations in such amounts, and make
such other adjustments from time to time, as shall be equitable to the end that
all Lenders share such payment in accordance with their respective ratable
shares as provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such a participation may, to
the fullest extent permitted by law, exercise all rights of payment, including
setoff, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan, LOC Obligation or other
obligation in the amount of such participation. Except as otherwise expressly
provided in this Credit Agreement, if any Lender or an Agent shall fail to remit
to an Agent or any other Lender an amount payable by such Lender or such Agent
to such Agent or such other Lender pursuant to this Credit Agreement on the date
when such amount is due, such payments shall be made together with interest
thereon for each date from the date such amount is due until the date such
amount is paid to such Agent or such other Lender at a rate per annum equal to
the Federal Funds Rate. If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 3.8 applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner consistent with the
rights of the Lenders under this Section 3.8 to share in the benefits of any
recovery on such secured claim.
3.9 Capital Adequacy. If, after the date hereof, any Lender has determined
that the adoption or the becoming effective of, or any change in, or any change
by any Governmental Authority, central bank or comparable agency charged with
the interpretation or administration thereof in the interpretation or
administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Lender, or its parent corporation, with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any such authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on such Lender's (or parent
corporation's) capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender, or its parent
corporation, could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's (or parent corporation's)
policies with respect to capital adequacy), then, upon notice from such Lender
to the Borrower, the Borrower shall be obligated to pay to such Lender such
additional amount or amounts as will compensate such Lender on an after-tax
basis (after taking into account applicable deductions and credits in respect of
the amount indemnified) for such reduction. Each determination by any such
Lender of amounts owing under this Section shall, absent manifest error, be
conclusive and binding on the parties hereto. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
3.10 Inability To Determine Interest Rate. If prior to the first day of any
Interest Period, the Administrative Agent shall have determined in good faith
(which determination shall be conclusive and binding upon the Borrower) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such Interest
Period, the Administrative Agent shall give telecopy or telephonic notice
thereof to the Borrower and the Lenders as soon as practicable thereafter, and
will also give prompt written notice to the Borrower when such conditions no
longer exist. If such notice is given (a) any Eurodollar Loans requested to be
made on the first day of such Interest Period shall be made as Base Rate Loans,
(b) any Loans that were to have been converted on the first day of such Interest
Period to or continued as Eurodollar Loans shall be converted to or continued as
Base Rate Loans and (c) any outstanding Eurodollar Loans shall be converted, on
the first day of such Interest Period, to Base Rate Loans. Until such notice has
been withdrawn by the Agent, no further Eurodollar Loans shall be made or
continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurodollar Loans.
3.11 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof occurring after the Closing Date shall make it unlawful for
any Lender to make or maintain Eurodollar Loans as contemplated by this Credit
Agreement, (a) such Lender shall promptly give written notice of such
circumstances to the Borrower and the Administrative Agent (which notice shall
be withdrawn whenever such circumstances no longer exist), (b) the commitment of
such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as
such and convert a Base Rate Loan to Eurodollar Loans shall forthwith be
canceled and, until such time as it shall no longer be unlawful for such Lender
to make or maintain Eurodollar Loans, such Lender shall then have a commitment
only to make a Base Rate Loan when a Eurodollar Loan is requested and (c) such
Lender's Loans then outstanding as Eurodollar Loans, if any, shall be converted
automatically to Base Rate Loans on the respective last days or the then current
Interest Periods with respect to such Loans or within such earlier period as
required by law. If any such conversion of a Eurodollar Loan occurs on a day
which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 3.14.
3.12 Requirements of Law. If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof applicable to
any Lender, or compliance by any Lender with any request or directive (whether
or not having the force of law) from any central bank or other Governmental
Authority, in each case made subsequent to the Closing Date (or, if later, the
date on which such Lender becomes a Lender):
(a) shall subject such Lender to any tax of any kind whatsoever with
respect to any Letter of Credit, any Eurodollar Loans made by it or its
obligation to make Eurodollar Loans, or change the basis of taxation of payments
to such Lender in respect thereof (except for Non-Excluded Taxes covered by
Section 3.13 (including Non-Excluded Taxes imposed solely by reason of any
failure of such Lender to comply with its obligations under Section 3.13(b)) and
changes in taxes measured by or imposed upon the overall net income, or
franchise tax (imposed in lieu of such net income tax), of such Lender or its
applicable lending office, branch, or any affiliate thereof);
(b) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender which
is not otherwise included in the determination of the Eurodollar Rate hereunder;
or
(c) shall impose on such Lender any other condition (excluding any tax of
any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such
Lender, by an amount which such Lender deems to be material, of making,
converting into, continuing or maintaining Eurodollar Loans or issuing or
participating in Letters of Credit or to reduce any amount receivable hereunder
in respect thereof, then, in any such case, upon notice to the Borrower from
such Lender, through the Agent, in accordance herewith, the Borrower shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender on an after-tax basis (after taking into
account applicable deductions and credits in respect of the amount indemnified)
for such increased cost or reduced amount receivable, provided that, in any such
case, the Borrower may elect to convert the Eurodollar Loans made by such Lender
hereunder to Base Rate Loans by giving the Administrative Agent at least one
Business Day's notice of such election, in which case the Borrower shall
promptly pay to such Lender, upon demand, without duplication, such amounts, if
any, as may be required pursuant to Section 3.14. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section 3.12, it shall provide
prompt notice thereof to the Borrower, through the Administrative Agent,
certifying (x) that one of the events described in this Section 3.12 has
occurred and describing in reasonable detail the nature of such event, (y) as to
the increased cost or reduced amount resulting from such event and (z) as to the
additional amount demanded by such Lender and a reasonably detailed explanation
of the calculation thereof. Such a certificate as to any additional amounts
payable pursuant to this Section 3.12 submitted by such Lender, through the
Administrative Agent, to the Borrower shall be conclusive and binding on the
parties hereto in the absence of manifest error. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
3.13 Taxes.
(a) Except as provided below in this Section 3.13, all payments made by the
Borrower under this Credit Agreement and any Notes shall be made free and clear
of, and without deduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, now or hereafter imposed, levied, collected,
withheld or assessed by any court, or governmental body, agency or other
official, excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or affiliate thereof,
and all franchise taxes, branch taxes, taxes on doing business or taxes on the
overall capital or net worth of any Lender or its applicable lending office, or
any branch or affiliate thereof, in each case imposed in lieu of net income
taxes: (i) by the jurisdiction under the laws of which such Lender, applicable
lending office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by reason
of any connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its obligations,
or received payment under or enforced, this Credit Agreement or any Notes. If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to an Agent or any Lender hereunder or under any Notes, (A) the
amounts so payable to an Agent or such Lender shall be increased to the extent
necessary to yield to an Agent or such Lender (after payment of all Non-Excluded
Taxes) interest or any such other amounts payable hereunder at the rates or in
the amounts specified in this Credit Agreement and any Notes, provided, however,
that the Borrower shall be entitled to deduct and withhold any Non-Excluded
Taxes and shall not be required to increase any such amounts payable to any
Lender that is not organized under the laws of the United States of America or a
state thereof if such Lender fails to comply with the requirements of paragraph
(b) of this Section 3.13 whenever any Non-Excluded Taxes are payable by the
Borrower, and (B) as promptly as possible after requested the Borrower shall
send to such Agent for its own account or for the account of such Lender, as the
case may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded
Taxes when due to the appropriate taxing authority or fails to remit to the
Administrative Agent the required receipts or other required documentary
evidence, the Borrower shall indemnify the Agents and any Lender for any
incremental taxes, interest or penalties that may become payable by an Agent or
any Lender as a result of any such failure. The agreements in this subsection
shall survive the termination of this Credit Agreement and the payment of the
Loans and all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(i) (A) on or before the date of any payment by the Borrower under
this Credit Agreement or Notes to such Lender, deliver to the Borrower and
the Administrative Agent (x) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor applicable form,
as the case may be, certifying that it is entitled to receive payments
under this Credit Agreement and any Notes without deduction or withholding
of any United States federal income taxes and (y) an Internal Revenue
Service Form W-8 or W-9, or successor applicable form, as the case may be,
certifying that it is entitled to an exemption from United States backup
withholding tax;
(B) deliver to the Borrower and the Administrative Agent two further
copies of any such form or certification on or before the date that any
such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(C) obtain such extensions of time for filing and complete such forms
or certifications as may reasonably be requested by the Borrower or the
Administrative Agent; or
(ii) in the case of any such Lender that is not a "bank" within the meaning
of Section 881(c)(3)(A) of the Internal Revenue Code, (A) represent to the
Borrower (for the benefit of the Borrower and the Agents) that it is not a bank
within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (B)
agree to furnish to the Borrower, on or before the date of any payment by the
Borrower, with a copy to the Administrative Agent, two accurate and complete
original signed copies of Internal Revenue Service Form W-8, or successor
applicable form certifying to such Lender's legal entitlement at the date of
such certificate to an exemption from U.S. withholding tax under the provisions
of Section 881(c) of the Internal Revenue Code with respect to payments to be
made under this Credit Agreement and any Notes (and to deliver to the Borrower
and the Administrative Agent two further copies of such form on or before the
date it expires or becomes obsolete and after the occurrence of any event
requiring a change in the most recently provided form and, if necessary, obtain
any extensions of time reasonably requested by the Borrower or the
Administrative Agent for filing and completing such forms), and (C) agree, to
the extent legally entitled to do so, upon reasonable request by the Borrower,
to provide to the Borrower (for the benefit of the Borrower and the Agents) such
other forms as may be reasonably required in order to establish the legal
entitlement of such Lender to an exemption from withholding with respect to
payments under this Credit Agreement and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation has
occurred after the date such Person becomes a Lender hereunder which renders all
such forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form with respect to it and such Lender so advises the
Borrower and the Administrative Agent then such Lender shall be exempt from such
requirements. Each Person that shall become a Lender or a participant of a
Lender pursuant to Section 11.3 shall, upon the effectiveness of the related
transfer, be required to provide all of the forms, certifications and statements
required pursuant to this subsection (b); provided that in the case of a
participant of a Lender, the obligations of such participant of a Lender
pursuant to this subsection (b) shall be determined as if the participant of a
Lender were a Lender except that such participant of a Lender shall furnish all
such required forms, certifications and statements to the Lender from which the
related participation shall have been purchased.
(c) In connection with this transaction there may or may not be due
certain documentary stamp taxes and/or intangible taxes imposed by the
State of Florida (the "Florida Taxes"). In addition to (and not in
limitation of) the indemnification with respect to tax liabilities set
forth above, the Borrower agrees to indemnify the Agents and each Lender,
their directors, officers, agents and employees from and against any and
all liability, damage, loss, cost, expense or reasonable attorney fees
which may accrue to or be sustained by an Agent, a Lender or their
directors, officers, agents or employees on account of or arising from any
claim or action raised by, filed or brought by or in the name of any
Florida governmental or administrative department with respect to
non-payment of the Florida Taxes against an Agent, a Lender, or any of
their directors, officers, agents or employees.
3.14 Indemnity. The Borrower promises to indemnify each Lender and to hold
each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this Credit
Agreement, (b) default by the Borrower in making any prepayment of a Eurodollar
Loan after the Borrower has given a notice thereof in accordance with the
provisions of this Credit Agreement and (c) the making of a prepayment of
Eurodollar Loans on a day which is not the last day of an Interest Period with
respect thereto. Such indemnification may include an amount equal to (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, convert
or continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Eurodollar
Loans provided for herein (excluding, however, the Applicable Percentage
included therein, if any) minus (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank Eurodollar market. The agreements in this Section shall
survive the termination of this Credit Agreement and the payment of the Loans
and all other amounts payable hereunder.
SECTION 4
GUARANTY
4.1 Guaranty of Payment. Subject to Section 4.7 below, each of the
Guarantors hereby, jointly and severally, unconditionally guarantees to each
Lender, each Affiliate of Lender that enters into a Hedging Agreement and the
Agents the prompt payment of the Credit Party Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration or
otherwise). The Guarantors additionally, jointly and severally, unconditionally
guarantee to each Lender, each Affiliate of a Lender that enters into a Hedging
Agreement and the Agents the timely performance of all other obligations under
the Credit Documents and the Hedging Agreements. This Guaranty is a guaranty of
payment and not of collection and is a continuing guaranty and shall apply to
all Credit Party Obligations whenever arising.
4.2 Obligations Unconditional. The obligations of the Guarantors hereunder
are absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or the
Hedging Agreements, or any other agreement or instrument referred to therein, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor. Each Guarantor agrees that this
Guaranty may be enforced by the Lenders without the necessity at any time of
resorting to or exhausting any other security or collateral and without the
necessity at any time of having recourse to the Notes or any other of the Credit
Documents or any collateral, if any, hereafter securing the Credit Party
Obligations or otherwise and each Guarantor hereby waives the right to require
the Lenders to proceed against the Borrower or any other Person (including a
co-guarantor) or to require the Lenders to pursue any other remedy or enforce
any other right. Each Guarantor further agrees that it shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor of the Credit Party Obligations for amounts paid under this
Guaranty until such time as the Lenders (and any Affiliates of Lenders entering
into Hedging Agreements) have been paid in full, all Commitments under the
Credit Agreement have been terminated and no Person or Governmental Authority
shall have any right to request any return or reimbursement of funds from the
Lenders in connection with monies received under the Credit Documents. Each
Guarantor further agrees that nothing contained herein shall prevent the Lenders
from suing on the Notes or any of the other Credit Documents or any of the
Hedging Agreements or foreclosing its security interest in or Lien on any
collateral, if any, securing the Credit Party Obligations or from exercising any
other rights available to it under this Credit Agreement, the Notes, any other
of the Credit Documents, or any other instrument of security, if any, and the
exercise of any of the aforesaid rights and the completion of any foreclosure
proceedings shall not constitute a discharge of any of any Guarantor's
obligations hereunder; it being the purpose and intent of each Guarantor that
its obligations hereunder shall be absolute, independent and unconditional under
any and all circumstances. Neither any Guarantor's obligations under this
Guaranty nor any remedy for the enforcement thereof shall be impaired, modified,
changed or released in any manner whatsoever by an impairment, modification,
change, release or limitation of the liability of the Borrower or by reason of
the bankruptcy or insolvency of the Borrower. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Credit Party
Obligations and notice of or proof of reliance of by any Agent or any Lender
upon this Guarantee or acceptance of this Guarantee. The Credit Party
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Guarantee. All dealings between the Borrower and any of the
Guarantors, on the one hand, and the Agents and the Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Guarantee.
4.3 Modifications. Each Guarantor agrees that (a) all or any part of the
security now or hereafter held for the Credit Party Obligations, if any, may be
exchanged, compromised or surrendered from time to time; (b) the Lenders shall
not have any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Credit
Party Obligations or the properties subject thereto; (c) the time or place of
payment of the Credit Party Obligations may be changed or extended, in whole or
in part, to a time certain or otherwise, and may be renewed or accelerated, in
whole or in part; (d) the Borrower and any other party liable for payment under
the Credit Documents may be granted indulgences generally; (e) any of the
provisions of the Notes or any of the other Credit Documents may be modified,
amended or waived; (f) any party (including any co-guarantor) liable for the
payment thereof may be granted indulgences or be released; and (g) any deposit
balance for the credit of the Borrower or any other party liable for the payment
of the Credit Party Obligations or liable upon any security therefor may be
released, in whole or in part, at, before or after the stated, extended or
accelerated maturity of the Credit Party Obligations, all without notice to or
further assent by such Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.
4.4 Waiver of Rights. Each Guarantor expressly waives to the fullest extent
permitted by applicable law: (a) notice of acceptance of this Guaranty by the
Lenders and of all extensions of credit to the Borrower by the Lenders; (b)
presentment and demand for payment or performance of any of the Credit Party
Obligations; (c) protest and notice of dishonor or of default (except as
specifically required in the Credit Agreement) with respect to the Credit Party
Obligations or with respect to any security therefor; (d) notice of the Lenders
obtaining, amending, substituting for, releasing, waiving or modifying any
security interest, lien or encumbrance, if any, hereafter securing the Credit
Party Obligations, or the Lenders' subordinating, compromising, discharging or
releasing such security interests, liens or encumbrances, if any; (e) all other
notices to which such Guarantor might otherwise be entitled; and (f) demand for
payment under this Guaranty.
4.5 Reinstatement. The obligations of the Guarantors under this Section 4
shall be automatically reinstated if and to the extent that for any reason any
payment by or on behalf of any Person in respect of the Credit Party Obligations
is rescinded or must be otherwise restored by any holder of any of the Credit
Party Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agents and each Lender on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees of counsel) incurred by an Agent
or such Lender in connection with such rescission or restoration, including any
such costs and expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or similar payment
under any bankruptcy, insolvency or similar law.
4.6 Remedies. The Guarantors agree that, as between the Guarantors, on the
one hand, and the Agents and the Lenders, on the other hand, the Credit Party
Obligations may be declared to be forthwith due and payable as provided in
Section 9 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors. The Guarantors
acknowledge and agree that their obligations hereunder are secured in accordance
with the terms of the Security Agreements and the other Collateral Documents and
that the Lenders may exercise their remedies thereunder in accordance with the
terms thereof.
4.7 Limitation of Guaranty. Notwithstanding any provision to the contrary
contained herein or in any of the other Credit Documents, to the extent the
obligations of any Guarantor shall be adjudicated to be invalid or unenforceable
for any reason (including, without limitation, because of any applicable state
or federal law relating to fraudulent conveyances or transfers) then the
obligations of such Guarantor hereunder shall be limited to the maximum amount
that is permissible under applicable law (whether federal or state and
including, without limitation, the Bankruptcy Code).
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions. The obligation of the Lenders to enter into this
Credit Agreement and make the initial Extension of Credit is subject to
satisfaction of the following conditions:
(a) Executed Credit Documents. Receipt by the Agents of duly executed
copies of: (i) this Credit Agreement; (ii) the Notes; (iii) the Collateral
Documents and (iv) all other Credit Documents, each in form and substance
reasonably acceptable to the Agents in their sole discretion.
(b) Corporate Documents. Receipt by the Agents of the following:
(i) Charter Documents. Copies of the articles or certificates of
incorporation or other charter documents of each Credit Party
certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other jurisdiction
of its incorporation and certified by a secretary or assistant
secretary of such Credit Party to be true and correct as of the
Effective Date.
(ii) Bylaws. A copy of the bylaws of each Credit Party certified
by a secretary or assistant secretary of such Credit Party to be true
and correct as of the Effective Date.
(iii) Resolutions. Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit
Documents to which it is a party, the transactions contemplated
therein and authorizing execution and delivery thereof, certified by a
secretary or assistant secretary of such Credit Party to be true and
correct and in force and effect as of the Effective Date.
(iv) Good Standing. Copies of (A) certificates of good standing,
existence or its equivalent with respect to each Credit Party
certified as of a recent date by the appropriate Governmental
Authorities of the state or other jurisdiction of incorporation and
each other jurisdiction in which the failure to so qualify and be in
good standing would have a Material Adverse Effect on the business or
operations of a Credit Party in such jurisdiction and (B) to the
extent available, a certificate indicating payment of all corporate
franchise taxes certified as of a recent date by the appropriate
governmental taxing authorities.
(v) Incumbency. An incumbency certificate of each Credit Party
certified by a secretary or assistant secretary to be true and correct
as of the Effective Date.
(c) Financial Statements. Receipt by the Agents and the Lenders of (i) the
consolidated financial statements of the Credit Parties for the year ending
January 28, 1996, including balance sheets and income and cash flow statements
audited by Deloitte & Touche LLP and containing an unqualified opinion of such
firm that such statements present fairly, in all material respects, the
consolidated financial position and results of operations of the Credit Parties,
and are prepared in conformity with GAAP and (ii) monthly financial statements
prepared by the Borrower for February 1996, March 1996 and April 1996.
(d) Opinion of Counsel. Receipt by the Agents of an opinion, or opinions
(which shall cover, among other things, authority, legality, validity, binding
effect, enforceability and attachment and perfection of liens), reasonably
satisfactory to the Agents, addressed to the Agents on behalf of the Lenders and
dated as of the Effective Date, from legal counsel to the Credit Parties.
(e) Examination. Receipt by the Agents of an independent examination, in
form and substance reasonably satisfactory to the Agents, of the accounts
receivable, inventory, payables, controls and systems of the Credit Parties.
(f) Personal Property Collateral. The Collateral Agent shall have received,
in form and substance reasonably satisfactory to the Collateral Agent:
(i) searches of Uniform Commercial Code ("UCC") filings in the
jurisdiction of the chief executive office of each Credit Party and
each jurisdiction where any Collateral is located or where a filing
would need to be made in order to perfect the Lenders' security
interest in the Collateral, copies of the financing statements on file
in such jurisdictions and evidence that no Liens exist other than
Permitted Liens;
(ii) duly executed UCC financing statements for each appropriate
jurisdiction as is necessary, in the Collateral Agent's sole
discretion, to perfect the Lenders' security interest in the
Collateral;
(iii) searches of ownership of intellectual property in the
appropriate governmental offices and such patent/trademark/copyright
filings as requested by the Collateral Agent in order to perfect the
Collateral Agent's security interest in the Collateral;
(iv) all stock certificates evidencing the stock pledged to the
Collateral Agent pursuant to the Pledge Agreements, together with duly
executed in blank undated stock powers attached thereto;
(v) all instruments and chattel paper in the possession of a Credit
Party, as required by the Security Agreements, together with allonges
or assignments as may be necessary or appropriate to perfect the
Lenders' security interest in the Collateral; and
(vi) at the request of the Collateral Agent, copies of the Assigned
Agreements, together with assignments and third party consents as may
be necessary or appropriate to perfect the Lenders' security interest
in such Assigned Contracts.
(g) Real Property Collateral. The Collateral Agent shall have received, in
form and substance reasonably satisfactory to the Collateral Agent:
(i) fully executed and notarized mortgages, deeds of trust or deeds to
secure debt (each a "Mortgage" and collectively the "Mortgages")
encumbering the fee interest of the Credit Parties in each real
property asset owned by a Credit Party set forth on Schedule 5.1(g)
(each a "Mortgaged Property" and collectively the "Mortgaged
Properties"), together with such UCC-1 financing statements as the
Collateral Agent shall deem appropriate with respect to each such
Mortgaged Property;
(ii) fully executed and notarized mortgages, deeds of trust or deeds
to secure debt (each a "Leasehold Mortgage" and collectively the
"Leasehold Mortgages") encumbering the leasehold interest of any of
the Credit Parties in each leasehold estate set forth on Schedule
5.1(h) (each a "Leasehold Mortgaged Property" and collectively the
"Leasehold Mortgaged Properties"), together with such UCC-1 financing
statements (or equivalent instruments) as the Collateral Agent shall
deem appropriate with respect to such Leasehold Mortgaged Properties
and evidence that each leasehold estate set forth on Schedule 5.1(h)
is in the name of a Credit Party; provided that the Collateral Agent
shall not file any Leasehold Mortgage unless (A) the consent of the
landlord to such Leasehold Mortgaged Property has been received or (B)
it would not violate the lease applicable to such Leasehold Mortgage;
(iii) an opinion of counsel in the state in which each Mortgaged
Property and Leasehold Mortgaged Property is located with respect to
the enforceability of the form of Mortgage or Leasehold Mortgage and
sufficiency of the form of UCC-1 financing statements to be recorded
or filed in such state and such other matters as the Collateral Agent
may request, in form and substance reasonably satisfactory to the
Collateral Agent; and
(iv) ALTA or other appropriate form mortgagee title insurance policies
(the "Mortgage Policies") issued by a title insurer reasonably
satisfactory to the Collateral Agent (the "Title Insurance Company"),
in an amount reasonably satisfactory to the Collateral Agent with
respect to each Mortgaged Property, assuring the Collateral Agent that
the applicable Mortgages create valid and enforceable first priority
mortgage liens on the respective Mortgaged Properties, free and clear
of all defects and encumbrances except Permitted Liens which Mortgage
Policies shall be in form and substance reasonably satisfactory to the
Collateral Agent and containing such endorsements as shall be
reasonably satisfactory to the Collateral Agent and for any other
matters that the Collateral Agent may request, and providing
affirmative insurance and such reinsurance as the Collateral Agent may
request, all of the foregoing in form and substance reasonably
satisfactory to the Agents.
(h) Evidence of Insurance. Receipt by the Agents of copies of insurance
policies or certificates of insurance of the Credit Parties evidencing liability
and casualty insurance meeting the requirements set forth in the Credit
Documents, including, but not limited to, naming the Collateral Agent as sole
loss payee on behalf of the Lenders.
(i) Material Adverse Effect. There shall not have occurred a change since
January 28, 1996 that has had or could reasonably be expected to have a Material
Adverse Effect (other than one-time restructuring charges taken not later than
the second fiscal quarter of 1996 and not to exceed an aggregate amount of $55
million).
(j) Litigation. There shall not exist any pending or threatened action,
suit, investigation or proceeding against a Credit Party or any of their
Subsidiaries that would have or would reasonably be expected to have a Material
Adverse Effect.
(k) Officer's Certificates. The Agents shall have received a certificate or
certificates executed by the chief financial officer of the Borrower on behalf
of the Borrower as of the Effective Date stating that (i) the Borrower and each
of the Borrower's Subsidiaries are in compliance with all existing material
financial obligations, (ii) no action, suit, investigation or proceeding is
pending or threatened in any court or before any arbitrator or governmental
instrumentality that purports to effect the Borrower, any of the Borrower's
Subsidiaries or any transaction contemplated by the Credit Documents, if such
action, suit, investigation or proceeding could have or could be reasonably
expected to have a Material Adverse Effect, (iii) the financial statements and
information delivered pursuant to Section 5.1(c) were prepared in good faith and
using reasonable assumptions and (iv) immediately after giving effect to this
Credit Agreement, the other Credit Documents and all the transactions
contemplated therein to occur on such date, (A) the Borrower and each of the
Borrower's Subsidiaries is Solvent, (B) no Default or Event of Default exists,
(C) all representations and warranties contained herein and in the other Credit
Documents are true and correct in all material respects, and (D) the Credit
Parties are in compliance with each of the financial covenants set forth in
Section 7.2.
(l) Fees and Expenses. Payment by the Credit Parties of (i) an upfront fee
of .25% of the Revolving Loan Commitment to be shared pro rata among the Lenders
and (ii) all other fees and expenses owed by them to the Lenders and the Agents,
including, without limitation, payment to the Agents of the fees set forth in
the Fee Letter.
(m) Borrowing Base Report. A Borrowing Base Report in the form of Exhibit
7.1(c), dated as of April 30, 1996.
(n) Other. Receipt by the Lenders of such other documents, instruments,
agreements or information as reasonably and timely requested by any Lender,
including, but not limited to, information regarding litigation, tax,
accounting, labor, insurance, pension liabilities (actual or contingent), real
estate leases, material contracts, debt agreements, property ownership and
contingent liabilities of the Borrower and its Subsidiaries.
5.2 Conditions to All Extensions of Credit. In addition to the conditions
precedent stated elsewhere herein, the Lenders shall not be obligated to make
Loans nor shall an Issuing Lender be required to issue or extend a Letter of
Credit unless:
(a) Notice. The Borrower shall have delivered (i) in the case of any new
Revolving Loan, a Notice of Borrowing, duly executed and completed, by the time
specified in Section 2.1 and (ii) in the case of any Letter of Credit, the
Issuing Lender shall have received an appropriate request for issuance in
accordance with the provisions of Section 2.2;
(b) Representations and Warranties. The representations and warranties made
by the Credit Parties in any Credit Document are true and correct in all
material respects at and as if made as of such date except to the extent they
expressly relate to an earlier date;
(c) No Default. No Default or Event of Default shall exist or be continuing
either prior to or after giving effect thereto;
(d) No Material Adverse Effect. There shall not have occurred any Material
Adverse Effect; and
(e) Availability. Immediately after giving effect to the making of a
Revolving Loan (and the application of the proceeds thereof) or to the issuance
of a Letter of Credit, as the case may be, the sum of the Revolving Loans
outstanding plus LOC Obligations outstanding shall not exceed the lesser of (i)
the Revolving Commitment Amount and (ii) the Borrowing Base Assets.
The delivery of each Notice of Borrowing and each request for a Letter of
Credit shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c), (d) and (e) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Agents and each Lender that:
6.1 Financial Condition. The financial statements delivered to the Lenders
pursuant to Section 5.1(c) and Section 7.1(a) and (b): (a) have been prepared in
accordance with GAAP and (b) present fairly the consolidated and consolidating
(as applicable) financial condition, results of operations and cash flows of the
Credit Parties and their Subsidiaries as of such date and for such periods.
Since January 28, 1996, there has been no sale, transfer or other disposition by
any Credit Party or any of their Subsidiaries of any material part of the
business or property of the Credit Parties, taken as a whole, and no purchase or
other acquisition by any of them of any business or property (including any
capital stock of any other Person) material in relation to the consolidated
financial condition of the Credit Parties, taken as a whole, in each case,
which, is not (i) reflected in the most recent financial statements delivered to
the Lenders pursuant to Section 7.1 or in the notes thereto or (ii) otherwise
permitted by the terms of this Credit Agreement and communicated to the
Administrative Agent.
6.2 No Material Change. (a) Since January 28, 1996, there has been no
development or event relating to or affecting a Credit Party or any of their
Subsidiaries which has had or would be reasonably expected to have a Material
Adverse Effect (other than one-time restructuring charges taken not later than
the second fiscal quarter of 1996 and not to exceed an aggregate amount of $55
million) and (b) from and after the Closing Date, except as otherwise permitted
under this Credit Agreement, no dividends or other distributions have been
declared, paid or made upon the capital stock or other equity interest in a
Credit Party or any of its Subsidiaries nor has any of the capital stock or
other equity interest in a Credit Party been redeemed, retired, purchased or
otherwise acquired for value.
6.3 Organization and Good Standing. Each Credit Party (a) is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State (or other jurisdiction) of its incorporation, (b) is duly qualified and in
good standing as a foreign corporation and authorized to do business in every
jurisdiction unless the failure to be so qualified, in good standing or
authorized would have a Material Adverse Effect and (c) has the requisite
corporate power and authority to own its properties and to carry on its business
as now conducted and as proposed to be conducted.
6.4 Due Authorization. Each Credit Party (a) has the requisite corporate
power and authority to execute, deliver and perform this Credit Agreement and
the other Credit Documents to which it is a party and to incur the obligations
herein and therein provided for and (b) is duly authorized to, and has been
authorized by all necessary corporate action, to execute, deliver and perform
this Credit Agreement and the other Credit Documents to which it is a party.
6.5 No Conflicts. Neither the execution and delivery of the Credit
Documents, nor the consummation of the transactions contemplated therein, nor
performance of and compliance with the terms and provisions thereof by such
Credit Party will (a) violate or conflict with any provision of its articles or
certificate of incorporation or bylaws, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation (including,
without limitation, Regulation U or Regulation X), order, writ, judgment,
injunction, decree or permit applicable to it, (c) violate, contravene or
conflict with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which could have or might be reasonably expected to have a Material Adverse
Effect, or (d) result in or require the creation of any Lien (other than those
contemplated in or created in connection with the Credit Documents) upon or with
respect to its properties.
6.6 Consents. Except for consents, approvals and authorizations which have
been obtained, no consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party in respect of any Credit Party is required in connection with the
execution, delivery or performance of this Credit Agreement or any of the other
Credit Documents by such Credit Party.
6.7 Enforceable Obligations. This Credit Agreement and the other Credit
Documents have been duly executed and delivered and constitute legal, valid and
binding obligations of each Credit Party enforceable against such Credit Party
in accordance with their respective terms, except as may be limited by
bankruptcy or insolvency laws or similar laws affecting creditors' rights
generally or by general equitable principles.
6.8 No Default. No Credit Party is in default in any respect under any
contract, lease, loan agreement, indenture, mortgage, security agreement or
other agreement or obligation to which it is a party or by which any of its
properties is bound which default would have or would be reasonably expected to
have a Material Adverse Effect. No Default or Event of Default has occurred or
exists except as previously disclosed in writing to the Lenders.
6.9 Ownership. Each Credit Party is the owner of, and has good and
marketable title to, all of its respective assets and none of such assets is
subject to any Lien other than Permitted Liens.
6.10 Indebtedness. The Credit Parties have no Indebtedness except (a) as
disclosed in the financial statements referenced in Section 6.1, (b) as set
forth on Schedule 6.10 and (c) as otherwise permitted by this Credit Agreement.
6.11 Litigation. There are no actions, suits or legal, equitable,
arbitration or administrative proceedings, pending or, to the knowledge of any
Credit Party, threatened against, the Borrower or any of its Subsidiaries which
could have or might be reasonably expected to have a Material Adverse Effect.
The Borrower has provided on Schedule 6.11 a complete description of all
litigation currently existing although the Borrower hereby represents to the
Lenders that none of such litigation could have or be reasonably expected to
have a Material Adverse Effect.
6.12 Taxes. Each Credit Party has filed, or caused to be filed, all tax
returns (federal, state, local and foreign) required to be filed and paid (a)
all amounts of taxes shown thereon to be due (including interest and penalties)
and (b) all other taxes, fees, assessments and other governmental charges
(including mortgage recording taxes, documentary stamp taxes and intangibles
taxes) owing by it, except for such taxes (i) which are not yet delinquent or
(ii) that are being contested in good faith and by proper proceedings, and
against which adequate reserves are being maintained in accordance with GAAP. No
Credit Party is aware of any proposed tax assessments against it.
6.13 Compliance with Law. Each Credit Party is in compliance with all
Requirements of Law and all other laws, rules, regulations, orders and decrees
(including without limitation Environmental Laws) applicable to it, or to its
properties, unless such failure to comply would not have or would not be
reasonably expected to have a Material Adverse Effect. No Requirement of Law
would be reasonably expected to cause a Material Adverse Effect.
6.14 ERISA. Except as would not result or be reasonably expected to result
in a Material Adverse Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no Termination Event has
occurred, and, to the best knowledge of the Credit Parties, no event or
condition has occurred or exists as a result of which any Termination Event
could reasonably be expected to occur, with respect to any Plan; (ii) no
"accumulated funding deficiency," as such term is defined in Section 302 of
ERISA and Section 412 of the Code, whether or not waived, has occurred with
respect to any Plan; (iii) each Plan has been maintained, operated, and
funded in compliance with its own terms and in material compliance with the
provisions of ERISA, the Code, and any other applicable federal or state
laws; and (iv) no lien in favor or the PBGC or a Plan has arisen or is
reasonably likely to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities" under each
Single Employer Plan (determined within the meaning of Section 401(a)(2) of
the Code, utilizing the actuarial assumptions used to fund such Plans),
whether or not vested, did not, as of the last annual valuation date prior
to the date on which this representation is made or deemed made, exceed the
current value of the assets of such Plan allocable to such accrued
liabilities.
(c) Neither the Borrower, nor any of its Subsidiaries nor any ERISA
Affiliate has incurred, or, to the best knowledge of the Credit Parties,
are reasonably expected to incur, any withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. Neither the Borrower, any
of its Subsidiaries nor any ERISA Affiliate has received any notification
that any Multiemployer Plan is in reorganization (within the meaning of
Section 4241 of ERISA), is insolvent (within the meaning of Section 4245 of
ERISA), or has been terminated (within the meaning of Title IV of ERISA),
and no Multiemployer Plan is, to the best knowledge of the Credit Parties,
reasonably expected to be in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of ERISA
or Section 4975 of the Code) or breach of fiduciary responsibility has
occurred with respect to a Plan which has subjected or is reasonably likely
to subject the Borrower or any of its Subsidiaries or any ERISA Affiliate
to any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which the Borrower or any of its Subsidiaries or any ERISA
Affiliate has agreed or is required to indemnify any person against any
such liability.
(e) The present value (determined using actuarial and other assumptions
which are reasonable with respect to the benefits provided and the
employees participating) of the liability of the Borrower and its
Subsidiaries and each ERISA Affiliate for post-retirement welfare benefits
to be provided to their current and former employees under Plans which are
welfare benefit plans (as defined in Section 3(1) of ERISA), net of all
assets under all such Plans allocable to such benefits, are reflected on
the Financial Statements in accordance with FASB 106.
(f) Each Plan which is a welfare plan (as defined in Section 3(1) of ERISA)
to which Sections 601-609 of ERISA and Section 4980B of the Code apply has
been administered in compliance in all material respects with such
sections.
6.15 Subsidiaries. Set forth on Schedule 6.15 is a complete and accurate
list of all Subsidiaries of each Credit Party. Information on Schedule 6.15
includes jurisdiction of incorporation, the number of shares of each class of
capital stock or other equity interests outstanding, the number and percentage
of outstanding shares of each class owned (directly or indirectly) by such
Credit Party; and the number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and all other similar rights
with respect thereto. The outstanding capital stock and other equity interests
of all such Subsidiaries is validly issued, fully paid and non-assessable and is
owned by each such Credit Party, directly or indirectly, free and clear of all
Liens (other than those arising under or contemplated in connection with the
Credit Documents). Other than as set forth in Schedule 6.15, neither any Credit
Party nor any Subsidiary thereof has outstanding any securities convertible into
or exchangeable for its capital stock nor does any such Person have outstanding
any rights to subscribe for or to purchase or any options for the purchase of,
or any agreements providing for the issuance (contingent or otherwise) of, or
any calls, commitments or claims of any character relating to its capital stock.
Schedule 6.15 may be updated from time to time by the Borrower by giving written
notice thereof to the Administrative Agent.
6.16 Use of Proceeds; Margin Stock. The proceeds of the Loans hereunder
will be used solely for the purposes specified in Section 7.11. None of the
proceeds of the Loans will be used for the purpose of purchasing or carrying any
"margin stock" as defined in Regulation U, Regulation X or Regulation G, or for
the purpose of reducing or retiring any Indebtedness which was originally
incurred to purchase or carry "margin stock" or any "margin security" or for any
other purpose which might constitute this transaction a "purpose credit" within
the meaning of Regulation U, Regulation X, Regulation G or Regulation T. None of
the Credit Parties owns any "margin stock".
6.17 Government Regulation. No Credit Party is subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Investment Company Act of 1940 or the Interstate Commerce Act, each as amended.
In addition, no Credit Party is (a) an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or controlled by such a company, or (b) a "holding company," or a "Subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or of
a "Subsidiary" or a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended. No director, executive officer or
principal shareholder of the Borrower or any of its Subsidiaries is a director,
executive officer or principal shareholder of any Lender. For the purposes
hereof the terms "director", "executive officer" and "principal shareholder"
(when used with reference to any Lender) have the respective meanings assigned
thereto in Regulation O issued by the Board of Governors of the Federal Reserve
System.
6.18 Environmental Matters.
(a) To the best of Borrower's knowledge, except as set forth on Schedule
6.18:
(i) Each of the Real Properties and all operations at the Real
Properties are in compliance with all applicable Environmental Laws,
and there is no violation of any Environmental Law with respect to the
Real Properties or the businesses operated by the Borrower or any of
their Subsidiaries (the "Businesses"), and there are no conditions
relating to the Businesses or Real Properties that would be reasonably
expected to give rise to liability under any applicable Environmental
Laws.
(ii) No Credit Party has received any written notice of, or inquiry
from any Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability regarding
Hazardous Materials or compliance with Environmental Laws with regard
to any of the Real Properties or the Businesses, nor does the Borrower
or any of its Subsidiaries have knowledge that any such notice is
being threatened.
(iii) Hazardous Materials have not been transported or disposed of
from the Real Properties, or generated, treated, stored or disposed of
at, on or under any of the Real Properties or any other location, in
each case by, or on behalf or with the permission of, the Borrower or
any of its Subsidiaries in a manner that would reasonably be expected
to give rise to liability under any applicable Environmental Law.
(iv) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Borrower or any of its
Subsidiaries, threatened, under any Environmental Law to which the
Borrower or any of its Subsidiaries is or will be named as a party,
nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to the Borrower or any of its Subsidiaries, the Real
Properties or the Businesses, in any amount reportable under the
federal Comprehensive Environmental Response, Compensation and
Liability Act or any analogous state law, except releases in
compliance with any Environmental Laws.
(v) There has been no release or threat of release of Hazardous
Materials at or from the Real Properties, or arising from or related
to the operations (including, without limitation, disposal) of the
Borrower or any of its Subsidiaries in connection with the Real
Properties or otherwise in connection with the Businesses.
(vi) None of the Real Properties contains, or has previously
contained, any Hazardous Materials at, on or under the Real Properties
in amounts or concentrations that, if released, constitute or
constituted a violation of, or could give rise to liability under,
Environmental Laws.
(vii) No Credit Party has assumed any liability of any Person (other
than another Credit Party) under any Environmental Law.
(b) The Borrower has adopted procedures that are designed to (i) ensure
that each Credit Party, any of its operations and each of the properties owned
or leased by each Credit Party remains in compliance with applicable
Environmental Laws and (ii) minimize any liabilities or potential liabilities
that each Credit Party, any of its operations and each of the properties owned
or leased by each Credit Party may have under applicable Environmental Laws.
6.19 Intellectual Property. Each Credit Party owns, or has the legal right
to use, all trademarks, tradenames, copyrights, technology, know-how and
processes (the "Intellectual Property") necessary for each of them to conduct
its business as currently conducted except for those the failure to own or have
such legal right to use would not have or be reasonably expected to have a
Material Adverse Effect. Set forth on Schedule 6.19 is a list of all
Intellectual Property owned by each Credit Party or that any Credit Party has
the right to use. Except as provided on Schedule 6.19, 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 any Credit Party know of any such claim, and to
the Credit Parties' knowledge the use of such Intellectual Property by the
Borrower or any of their Subsidiaries does not infringe on the rights of any
Person, except for such claims and infringements that in the aggregate, would
not have or be reasonably expected to have a Material Adverse Effect. Schedule
6.19 may be updated from time to time by the Borrower by giving written notice
thereof to the Administrative Agent.
6.20 Solvency. Each Credit Party is and, after consummation of the
transactions contemplated by this Credit Agreement, will be Solvent.
6.21 Investments. All Investments of each Credit Party are either Permitted
Investments or otherwise permitted by the terms of this Credit Agreement.
6.22 Location of Collateral. Set forth on Schedule 6.22(a) is a list of all
Real Properties (and whether such property is a Mortgaged Property or a
Leasehold Mortgaged Property) with street address, county and state where
located, and in the case of each Leasehold Mortgaged Property, the name of the
lessor and lessee, the amount of the annual rent and the expiration date of the
leasehold interest. Set forth on Schedule 6.22(b) is a list of all locations
where any personal property of a Credit Party is located, including county and
state where located. Set forth on Schedule 6.22(c) is the chief executive office
and principal place of business of each Credit Party. Schedule 6.22(a), 6.22(b)
and 6.22(c) may be updated from time to time by the Borrower by giving written
notice thereof to the Administrative Agent.
6.23 Disclosure. Neither this Agreement nor any financial statements
delivered to the Lenders nor any other document, certificate or statement
furnished to the Lenders by or on behalf of any Credit Party in connection with
the transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.
6.24 Licenses, etc. The Credit Parties have obtained and hold in full force
and effect, all franchises, licenses, permits, certificates, authorizations,
qualifications, accreditations, easements, rights of way and other rights,
consents and approvals which are necessary for the operation of their respective
businesses as presently conducted, except where the failure to obtain same would
not have a Material Adverse Effect.
6.25 No Burdensome Restrictions. No Credit Party is a party to any
agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, would have or be reasonably expected to
have a Material Adverse Effect.
6.26 Collateral Documents. The Collateral Documents create valid security
interests in, and first mortgage Liens on, the Collateral purported to be
covered thereby, which security interests and mortgage Liens are and will remain
perfected security interests and mortgage Liens, prior to all other Liens other
than Permitted Liens. Each of the representations and warranties made by the
Borrower and its Subsidiaries in the Collateral Documents is true and correct in
all material respects.
6.27 Leases. Each of the leases corresponding to the Leasehold Mortgaged
Properties set forth on Schedule 6.22(a) is in full force and effect, and is
enforceable in accordance with its terms.
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans and LOC Obligations, together with
interest and fees and other obligations hereunder, have been paid in full and
the Commitments and Letters of Credit hereunder shall have terminated:
7.1 Information Covenants. The Borrower will furnish, or cause to be
furnished, to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 90 days after the close of each fiscal year of the
Borrower, a consolidated balance sheet and income statement of the
Borrower and its Subsidiaries, as of the end of such fiscal year,
together with related consolidated statements of operations and
retained earnings and of cash flows for such fiscal year, setting
forth in comparative form consolidated figures for the preceding
fiscal year, all such financial information described above to be in
reasonable form and detail and audited by independent certified public
accountants of recognized national standing reasonably acceptable to
the Agents and whose opinion shall be to the effect that such
financial statements have been prepared in accordance with GAAP
(except for changes with which such accountants concur) and shall not
be limited as to the scope of the audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and in any
event within 45 days after the close of each fiscal quarter of the
Borrower, (i) a consolidated balance sheet and income statement of the
Borrower and its Subsidiaries, as of the end of such fiscal quarter,
together with related consolidated statements of operations and
retained earnings and of cash flows for such fiscal quarter in each
case setting forth in comparative form consolidated figures for (A)
the corresponding period of the preceding fiscal year and (B)
management's proposed budget for such period, all such financial
information described above to be in reasonable form and detail and
reasonably acceptable to the Agent, and accompanied by a certificate
of the chief financial officer of the Borrower to the effect that such
quarterly financial statements fairly present in all material respects
the financial condition of the Borrower and its Subsidiaries and have
been prepared in accordance with GAAP, subject to changes resulting
from audit and normal year-end audit adjustments and (ii) a management
discussion and analysis of operating results for such fiscal quarter.
(c) Monthly Financial Statements. As soon as available and in any
event within 30 days after the end of each month of the Borrower,
(i) a consolidated balance sheet and income statement of the Borrower
and its Subsidiaries as at the end of such month together with related
consolidated statements of operations and retained earnings and of
cash flows for such month in each case setting forth in comparative
form consolidated figures for (A) the corresponding period of the
preceding fiscal year and (B) management's proposed budget for such
period, and all such financial information described above to be in
reasonable form and detail and reasonably acceptable to the Agents,
and accompanied by a certificate of the chief financial officer of the
Borrower to the effect that such monthly financial statements fairly
present in all material respects the financial condition of the
Borrower and its Subsidiaries and have been prepared in accordance
with GAAP, subject to changes resulting from audit and normal year-end
audit adjustments, (ii) a Borrowing Base Report, as of the end of the
immediately preceding month substantially in the form of Exhibit
7.1(c) and certified by the chief financial officer of the Borrower to
be true and correct as of the date thereof and (iii) financial data on
a store by store basis in a form similar to such data delivered
pursuant to the Existing Credit Agreement.
(d) Officer's Certificate. At the time of delivery of the financial
statements provided for in Sections 7.1(a) and 7.1(b) above, a
certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(d), (i) demonstrating
compliance with Sections 8.1(f), 8.5, 8.6 and 8.7 and with the
financial covenants contained in Section 7.2 by calculation thereof as
of the end of each such fiscal period, (ii) demonstrating compliance
with the restrictions on the amount of Capital Expenditures set forth
in Section 8.14 and (iii) stating that no Default or Event of Default
exists, or if any Default or Event of Default does exist, specifying
the nature and extent thereof and what action the Borrower proposes to
take with respect thereto.
(e) Annual Business Plan and Budgets. Within 30 days after the end of
each fiscal year of the Borrower, an annual business plan and budget
of the Borrower and its Subsidiaries on a consolidated basis
containing, among other things, pro forma financial statements for the
next two fiscal years.
(f) Compliance With Certain Provisions of the Credit Agreement. Within
90 days after the end of each fiscal year of the Borrower, a
certificate of the chief financial officer of the Borrower containing
information regarding the amount of any Asset Dispositions, Debt
Issuances and Equity Issuances that were made during the prior fiscal
year.
(g) Accountant's Certificate. Within the period for delivery of the
annual financial statements provided in Section 7.1(a), a certificate
of the accountants conducting the annual audit stating that they have
reviewed this Credit Agreement and stating further whether, in the
course of their audit, they have become aware of any Default or Event
of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(h) Auditor's Reports. Promptly upon receipt thereof, a copy of any
"management letter" submitted by independent accountants to the
Borrower or any of its Subsidiaries in connection with any annual,
interim or special audit of the books of the Borrower or any of its
Subsidiaries.
(i) Reports. Promptly upon transmission or receipt thereof, (a) copies
of any filings and registrations with, and reports to or from, the
Securities and Exchange Commission, or any successor agency, and
copies of all financial statements, proxy statements, notices and
reports as the Borrower or any of its Subsidiaries shall send to its
shareholders generally or to a holder of the Subordinated Debt in its
capacity as such a holder and (b) upon the written request of an
Agent, all reports and written information to and from the United
States Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies
or authorities concerning environmental, health or safety matters.
(j) Notices. Upon a Credit Party obtaining knowledge thereof, such
Credit Party will give written notice to the Administrative Agent
immediately of (a) the occurrence of an event or condition consisting
of a Default or Event of Default, specifying the nature and existence
thereof and what action the Borrower proposes to take with respect
thereto, and (b) the occurrence of any of the following with respect
to a the Borrower or any of its Subsidiaries (i) the pendency or
commencement of any litigation, arbitral or governmental proceeding
against the Borrower or any of its Subsidiaries which if adversely
determined would have or would be reasonably expected to have a
Material Adverse Effect, or (ii) the institution of any proceedings
against the Borrower or any of its Subsidiaries with respect to, or
the receipt of notice by such Person of potential liability or
responsibility for violation, or alleged violation of any federal,
state or local law, rule or regulation, including but not limited to,
Environmental Laws, the violation of which would have or would be
reasonably expected to have a Material Adverse Effect.
(k) ERISA. Upon any of the Credit Parties or any ERISA Affiliate
obtaining knowledge thereof, Borrower will give written notice to the
Administrative Agent and each of the Lenders promptly (and in any
event within five Business Days) of: (i) any event or condition,
including, but not limited to, any Reportable Event, that constitutes,
or might reasonably lead to, a Termination Event; (ii) with respect to
any Multiemployer Plan, the receipt of notice as prescribed in ERISA
or otherwise of any withdrawal liability assessed against the
Borrowers or any of their ERISA Affiliates, or of a determination that
any Multiemployer Plan is in reorganization or insolvent (both within
the meaning of Title IV of ERISA); (iii) the failure to make full
payment on or before the due date (including extensions) thereof of
all amounts which the Borrower or any of its Subsidiaries or ERISA
Affiliates is required to contribute to each Plan pursuant to its
terms and as required to meet the minimum funding standard set forth
in ERISA and the Code with respect thereto; or (iv) any change in the
funding status of any Plan that could have a Material Adverse Effect;
together, with a description of any such event or condition or a copy
of any such notice and a statement by the principal financial officer
of the Borrower briefly setting forth the details regarding such
event, condition, or notice, and the action, if any, which has been or
is being taken or is proposed to be taken by the Credit Parties with
respect thereto. Promptly upon request, the Borrower shall furnish the
Administrative Agent and each of the Lenders with such additional
information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return
(Form 5500 series), as well as all schedules and attachments thereto
required to be filed with the Department of Labor and/or the Internal
Revenue Service pursuant to ERISA and the Code, respectively, for each
"plan year" (within the meaning of Section 3(39) of ERISA).
(l) Environmental.
(i) Subsequent to a notice from any Governmental Authority that
would reasonably cause concern or during the existence of an
Event of Default, and upon the written request of an Agent, the
Borrower will furnish or cause to be furnished to the
Administrative Agent, at the Borrower's expense, a report of an
environmental assessment of reasonable scope, form and depth,
including, where appropriate, invasive soil or groundwater
sampling, by a consultant reasonably acceptable to the Agents as
to the nature and extent of the presence of any Hazardous
Materials on any property owned, leased or operated by a Credit
Party and as to the compliance by the Credit Parties with
Environmental Laws. If the Borrower fails to deliver such an
environmental report within seventy-five (75) days after receipt
of such written request then the Agents may arrange for same, and
the Borrower hereby grants to the Agents and their
representatives access to the Real Properties and a license of a
scope reasonably necessary to undertake such an assessment
(including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for by
the Agents pursuant to this provision will be payable by the
Borrower on demand and added to the obligations secured by the
Collateral Documents.
(ii) Each Credit Party will conduct and complete all
investigations, studies, sampling, and testing and all remedial,
removal, and other actions necessary to address all Hazardous
Materials on, from, or affecting any real property owned or
leased by a Credit Party to the extent necessary to be in
compliance with all Environmental Laws and all other applicable
federal, state, and local laws, regulations, rules and policies
and with the orders and directives of all Governmental
Authorities exercising jurisdiction over such real property to
the extent any failure would have or be reasonably expected to
have a Material Adverse Effect.
(m) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or
financial condition of the Credit Parties as an Agent may reasonably
request, including, without limitation, appraisals on personal
property.
7.2 Financial Covenants.
(a) Cash Flow Coverage Ratio. The Cash Flow Coverage Ratio, as of the
end of each fiscal quarter for the twelve month period ending on such
date, shall be greater than or equal to:
(i) From the Effective Date to and including February 2, 1997,
1.15 to 1.0; and
(ii) From February 3, 1997 and thereafter, 1.20 to 1.0.
(b) Senior Debt to Capitalization Ratio.
(i) The Senior Debt to Capitalization Ratio, as of the end of the
first, second and fourth fiscal quarter of the Borrower of each
fiscal year of the Borrower, shall be less than or equal to .55
to 1.0.
(ii) The Senior Debt to Capitalization Ratio, as of the end of
the third fiscal quarter of the Borrower of each fiscal year of
the Borrower, shall be less than or equal to .575 to 1.0.
(c) Net Worth. At all times the Net Worth shall be greater than or
equal to the sum of (i) $142,000,000 plus (ii) 75% of Net Income (as
calculated at the end of each fiscal quarter of the Borrower on a
cumulative basis and without deduction for any losses) plus (iii) all
Net Cash Proceeds from an Equity Issuance.
(d) Borrowing Base Assets. At all times the amount of Borrowing Base
Assets must be greater than or equal to the sum of the aggregate
amount of Revolving Loans outstanding plus the aggregate amount of LOC
Obligations outstanding or if not the Borrower must immediately comply
with Section 3.3(b)(i).
7.3 Preservation of Existence and Franchises. Each of the Credit Parties
will do all things necessary to preserve and keep in full force and effect its
existence, rights, franchises and authority except as permitted by Section 8.4.
7.4 Books and Records. Each of the Credit Parties will keep complete and
accurate books and records of its transactions in accordance with good
accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).
7.5 Compliance with Law. Each of the Credit Parties will comply with all
material laws, rules, regulations and orders, and all applicable material
restrictions imposed by all Governmental Authorities, applicable to it and its
property (including, without limitation, Environmental Laws).
7.6 Payment of Taxes and Other Indebtedness. Each of the Credit Parties
will pay, settle or discharge (a) all taxes, assessments and governmental
charges or levies imposed upon it, or upon its income or profits, or upon any of
its properties, before they shall become delinquent, (b) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien upon any of its properties, and (c) except as prohibited
hereunder, all of its other Indebtedness as it shall become due; provided,
however, that a Credit Party shall not be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in good
faith by appropriate proceedings and as to which adequate reserves therefor have
been established in accordance with GAAP, unless the failure to make any such
payment (i) would give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) would have a Material Adverse Effect.
7.7 Insurance. Each of the Credit Parties will at all times maintain in
full force and effect insurance (including worker's compensation insurance,
liability insurance, casualty insurance and business interruption insurance) in
such amounts, covering such risks and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice.
All liability policies shall have the Administrative Agent, on behalf of the
Lenders, as an additional insured and all casualty policies shall have the
Administrative Agent, on behalf of the Lenders, as loss payee.
In the event there occurs any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party shall
promptly give written notice thereof to the Administrative Agent generally
describing the nature and extent of such damage or destruction. Subsequent to
any loss, damage to or destruction of the Collateral of any Credit Party or any
part thereof, such Credit Party, whether or not the insurance proceeds, if any,
received on account of such damage or destruction shall be sufficient for that
purpose, at such Credit Party's cost and expense, will promptly repair or
replace the Collateral of such Credit Party so lost, damaged or destroyed;
provided, however, that such Credit Party need not repair or replace the
Collateral of such Credit Party so lost, damaged or destroyed to the extent the
failure to make such repair or replacement (a) is desirable to the proper
conduct of the business of such Credit Party in the ordinary course and
otherwise is in the best interest of such Credit Party and (b) would not
materially impair the rights and benefits of the Agents or the Lenders under
this Credit Agreement or any other Credit Document. In the event a Credit Party
shall receive any insurance proceeds, as a result of any loss, damage or
destruction, in a net amount in excess of $1,000,000, such Credit Party will
immediately pay over such proceeds to the Administrative Agent as cash
collateral for the Credit Party Obligations. The Administrative Agent agrees to
release such insurance proceeds to such Credit Party for replacement or
restoration of the portion of the Collateral of such Credit Party lost, damaged
or destroyed if (A) within 15 days from the date the Administrative Agent
receives such insurance proceeds, the Administrative Agent has received written
application for such release from such Credit Party together with evidence
reasonably satisfactory to it that the Collateral lost, damaged or destroyed has
been or will be replaced or restored to its condition (or by Collateral having a
value at least equal to the condition of the asset subject to the loss, damage
or destruction) immediately prior to the loss, destruction or other event giving
rise to the payment of such insurance proceeds and (B) on the date of such
release no Default or Event of Default exists. If the conditions in the
preceding sentence are not met, the Administrative Agent shall, on the first
Business Day subsequent to the date 30 days after it received such insurance
proceeds, apply such insurance proceeds as a mandatory prepayment of the Credit
Party Obligations for application in accordance with the terms of Section
3.3(b)(ii) and Section 3.3(c). All insurance proceeds shall be subject to the
security interest of the Lenders under the Collateral Documents.
The present insurance coverage of the Borrower and its Subsidiaries is outlined
as to carrier, policy number, expiration date, type and amount on Schedule 7.7,
as Schedule 7.7 may be amended from time to time by written notice to the
Administrative Agent.
7.8 Maintenance of Property. Each of the Credit Parties will maintain and
preserve its properties and equipment in good repair, working order and
condition, normal wear and tear excepted (subject to damage by casualties), and
will make, or cause to be made, in such properties and equipment from time to
time all repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent and in the manner
customary for companies in similar businesses.
7.9 Performance of Obligations. Each of the Credit Parties will perform in
all material respects all of its obligations under the terms of all material
agreements, indentures, mortgages, security agreements or other debt instruments
to which it is a party or by which it is bound.
7.10 Collateral. If, subsequent to the Closing Date, a Credit Party shall
(a) acquire or lease any real property or (b) acquire any intellectual property,
securities, instruments, chattel paper or other personal property required to be
delivered to the Collateral Agent as Collateral hereunder or under any of the
Collateral Documents, the Borrower shall immediately notify the Collateral Agent
of same. Each Credit Party shall take such action (including, but not limited
to, the actions set forth in Sections 5.1(g) and (h)), as requested by the
Collateral Agent and at its own expense, to ensure that the Lenders have a first
priority perfected Lien in all owned real property (and in such leased real
property as reasonably requested by the Collateral Agent or the Required
Lenders) and all personal property of the Credit Parties (whether now owned or
hereafter acquired), subject only to Permitted Liens. Each Credit Party shall
adhere to the covenants regarding the location of personal property as set forth
in the Security Agreements.
7.11 Use of Proceeds. The Credit Parties will use the proceeds of the Loans
solely (a) to refinance the outstanding principal balance of the Existing Credit
Agreement and the Existing TROL, (b) to pay related fees and expenses in
connection with the foregoing, (c) to provide working capital, (d) to make
Capital Expenditures and (e) for general corporate purposes. The Credit Parties
will use the Letters of Credit solely for the purposes set forth in Section
2.2(a).
7.12 Audits/Inspections. Upon reasonable notice and during normal business
hours and in a manner than will not unreasonably interfere with its business
operations, each Credit Party will permit representatives appointed by an Agent,
including, without limitation, independent accountants, agents, attorneys and
appraisers to visit and inspect such Credit Party's property, including its
books and records, its accounts receivable and inventory, its facilities and its
other business assets, and to make photocopies or photographs thereof and to
write down and record any information such representative obtains and shall
permit an Agent or its representatives to investigate and verify the accuracy of
information provided to the Lenders, including, without limitation, the
performance of collateral valuation reviews from time to time to assess the
composition of the Borrowing Base Assets, and to discuss all such matters with
the officers, employees and representatives of the Credit Parties.
7.13 Additional Credit Parties. At the time any Person becomes a Subsidiary
of a Credit Party, the Borrower shall so notify the Administrative Agent and
promptly thereafter (but in any event within 30 days after the date thereof)
shall cause such Person to (a) execute a Joinder Agreement in substantially the
same form as Exhibit 7.13, (b) cause all of the capital stock of such Person to
be delivered to the Collateral Agent (together with undated stock powers signed
in blank) and pledged to the Collateral Agent pursuant to an appropriate pledge
agreement in substantially the form of the Pledge Agreements and otherwise in a
form reasonably acceptable to the Collateral Agent, (c) pledge all of its assets
to the Lenders pursuant to a security agreement in substantially the form of the
Security Agreements and otherwise in a form reasonably acceptable to the
Collateral Agent, (d) if such Person has any Subsidiaries, (i) deliver all of
the capital stock of such Subsidiaries (together with undated stock powers
signed in blank) to the Collateral Agent and (ii) execute a pledge agreement in
substantially the form of the Pledge Agreements and otherwise in a form
reasonably acceptable to the Collateral Agent, (e) if such Person owns or leases
any real property, execute any and all necessary mortgages, deeds of trust,
deeds to secure debt, leasehold mortgages, collateral assignments of leaseholds
or other appropriate real estate collateral documentation in a form
substantially similar to the Mortgages or the Leasehold Mortgages, as the case
may be, with appropriate covenants as necessary and (f) deliver such other
documentation as the Administrative Agent or Collateral Agent may reasonably
request in connection with the foregoing, including, without limitation,
appropriate UCC-1 financing statements, real estate title insurance policies,
environmental reports, landlord waivers, certified resolutions and other
organizational and authorizing documents of such Person and favorable opinions
of counsel to such Person (which shall cover, among other things, the legality,
validity, binding effect and enforceability of the documentation referred to
above), all in form, content and scope reasonably satisfactory to the Agents.
7.14 Interest Rate Protection Agreements. The Borrower shall, within 30
days of the Closing Date, enter into, and maintain until the Revolving Loan
Maturity Date, interest rate protection agreements, in form and substance
(including, without limitation, the level thereof) reasonably acceptable to the
Agents, protecting against fluctuations in interest rates, for a period expiring
no earlier than the Revolving Loan Maturity Date and in a notional amount of at
least $50 million.
7.15 Further Assurances Regarding Collateral. As soon as practicable but no
later than 90 days after the Closing Date, the Agents shall receive, in form and
substance acceptable to the Agents:
(a) Environmental Reports. Environmental assessment reports and related
documents with respect to all Mortgaged Properties.
(b) Landlord Consents. In the case of each Leasehold Mortgaged Property,
(A) such estoppel letters, consents and waivers from the landlords of such
real property as may be reasonably required by the Collateral Agent, which
estoppel letters shall be in form and substance reasonably satisfactory to
the Collateral Agent and (B) evidence that the applicable lease, a
memorandum of lease with respect thereto, or other evidence of such lease
in form and substance reasonably satisfactory to the Collateral Agent, has
been or will be recorded in all places to the extent necessary or
desirable, in the reasonable judgment of the Collateral Agent, so as to
enable the Leasehold Mortgage encumbering such leasehold interest to
effectively create a valid and enforceable lien (subject only to Permitted
Liens) on such leasehold interest in favor of the Collateral Agent (or such
other Person as may be required or desired under local law) for the benefit
of Lenders; provided that failure to timely provide the above shall not
constitute a Default or Event of Default but the result shall be that any
equipment or inventory located at a Leasehold Mortgage Property for which
the above is not obtained shall cease to be "Eligible Equipment" or
"Eligible Inventory" as set forth in such definitions.
(c) Surveys. Maps or plats of an as-built survey of the sites of the
Mortgaged Properties certified to the Collateral Agent and the Title
Insurance Company in a manner reasonably satisfactory to them, dated a date
satisfactory to the Collateral Agent and the Title Insurance Company by an
independent professional licensed land surveyor reasonably satisfactory to
the Collateral Agent and the Title Insurance Company, which maps or plats
and the surveys on which they are based shall be sufficient to delete any
standard printed survey exception contained in the applicable title policy
and be made in accordance with the Minimum Standard Detail Requirements for
Land Title Surveys jointly established and adopted by the American Land
Title Association and the American Congress on Surveying and Mapping in
1992, and, without limiting the generality of the foregoing, there shall be
surveyed and shown on such maps, plats or surveys the following: (A) the
locations on such sites of all the buildings, structures and other
improvements and the established building setback lines; (B) the lines of
streets abutting the sites and width thereof; (C) all access and other
easements appurtenant to the sites necessary to use the sites; (D) all
roadways, paths, driveways, easements, encroachments and overhanging
projections and similar encumbrances affecting the site, whether recorded,
apparent from a physical inspection of the sites or otherwise known to the
surveyor; (E) any encroachments on any adjoining property by the building
structures and improvements on the sites; and (F) if the site is described
as being on a filed map, a legend relating the survey to said map.
(d) Flood Certificates. Certification from a registered engineer or land
surveyor or other evidence reasonably acceptable to the Collateral Agent
that none of the improvements on the Mortgaged Properties are located
within any area designated by the Director of the Federal Emergency
Management Agency as a "special flood hazard" area or if any improvements
on the Mortgaged Properties are located within a "special flood hazard"
area, evidence of a flood insurance policy from a company and in an amount
reasonably satisfactory to the Collateral Agent for the applicable portion
of the premises, naming the Collateral Agent, for the benefit of the
Lenders, as mortgagee.
(e) Valuations. A real estate valuation for each of the Mortgaged
Properties.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this Credit
Agreement is in effect and until the Loans and LOC Obligations, together with
interest, fees and other obligations hereunder, have been paid in full and the
Commitments and Letters of Credit hereunder shall have terminated:
8.1 Indebtedness. No Credit Party will, nor will it permit any of its
Subsidiaries to, contract, create, incur, assume or permit to exist any
Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the other
Credit Documents;
(b) the Subordinated Debt;
(c) Indebtedness existing as of the Closing Date (other than the
Subordinated Debt) as referenced in Section 6.10 (and renewals,
refinancings or extensions thereof on terms and conditions no more
favorable, in the aggregate, to such Person than such existing
Indebtedness and in a principal amount not in excess of that
outstanding as of the date of such renewal, refinancing or extension);
(d) Indebtedness in respect of current accounts payable and accrued
expenses incurred in the ordinary course of business including, to the
extent not current, accounts payable and accrued expenses that are
subject to bona fide dispute;
(e) Indebtedness owing by one Credit Party to another Credit Party;
(f) purchase money Indebtedness (including Capital Leases) incurred by
the Borrower or any of its Subsidiaries to finance the purchase of
fixed assets; provided that (i) the total of all such Indebtedness for
all such Persons taken together shall not exceed an aggregate
principal amount of $7,000,000 at any one time outstanding (including
any such Indebtedness referred to in subsection (c) above); (ii) such
Indebtedness when incurred shall not exceed the purchase price of the
asset(s) financed; and (iii) no such Indebtedness shall be refinanced
for a principal amount in excess of the principal balance outstanding
thereon at the time of such refinancing; and
(g) Indebtedness arising from obligations of the Credit Parties
evidenced by the interest rate protection agreements referred to in
Section 7.14.
8.2 Liens. No Credit Party will, nor will it permit its Subsidiaries to
contract, create, incur, assume or permit to exist any Lien with respect to any
of its property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3 Nature of Business. No Credit Party will alter the character of its
business from that conducted as of the Closing Date or engage in any business
other than the business conducted as of the Closing Date.
8.4 Consolidation and Merger. No Credit Party will enter into any
transaction of merger or consolidation or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution); provided that notwithstanding the
foregoing provisions of this Section 8.4, any Credit Party may be merged or
consolidated with or into the Borrower or any other Credit Party if (a) such
transaction is between the Borrower and another Credit Party, the Borrower is
the continuing or surviving corporation; (b) the Administrative Agent is given
prior written notice of such action, and the Credit Parties execute and deliver
such documents, instruments and certificates as the Collateral Agent may request
in order to maintain the perfection and priority of the Liens on the assets of
the Credit Parties; and (c) after giving effect thereto no Default or Event of
Default exists; and provided further that the Borrower may merge into a Florida
corporation (the "New Borrower") if simultaneously with such merger the Borrower
delivers to the Administrative Agent: (i) evidence that the merger of Sports &
Recreation, Inc. into the New Borrower has been consummated and filed with the
Secretary of State of Florida, (ii) an Assumption Agreement, in a form
reasonably acceptable to the Agents, duly executed by the New Borrower, (iii)
new Revolving Loan Notes in favor of each Lender duly executed by the New
Borrower, (iv) an Amended and Restated Security Agreement and an Amended and
Restated Pledge Agreement duly executed by the New Borrower and the other Credit
Parties, (v) duly executed amendments to the Mortgage Documents, together with
updates to title policies as necessary and appropriate, (vi) duly executed
amendments to all UCC financing statements as necessary and appropriate, (vii)
new stock certificates and stock powers as necessary and appropriate, (viii)
such corporate documentation of the New Borrower as necessary and appropriate
and similar to that set forth in Section 5.1(b) for the Borrower, (ix) an
opinion of counsel of the New Borrower and the other Credit Parties, in form and
substance reasonably acceptable to the Agents and (x) all other documents,
agreements and instruments as reasonably requested by the Agents.
8.5 Sale or Lease of Assets. No Credit Party will convey, sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business or assets whether now owned or
hereafter acquired, including, without limitation, inventory, receivables,
equipment, real property interests (whether owned or leasehold), and securities,
other than (a) any inventory sold or otherwise disposed of in the ordinary
course of business; (b) the sale, lease, transfer or other disposal by a Credit
Party (other than the Borrower) of any or all of its assets to the Borrower or
to another Credit Party; (c) obsolete, slow-moving, idle or worn-out assets
(including inventory) no longer used or useful in its business, not to exceed,
in the aggregate, a book value of $36,000,000 during the term of this Credit
Agreement; (d) (i) the sale of unimproved real estate and (ii) the sale of
existing stores (together with related fixtures but not including inventory) not
to exceed, in the aggregate, a book value of $24,000,000 during the term of this
Credit Agreement; provided that any sale of assets pursuant to this Section
8.5(d) shall be subject to the following conditions: (A) the Borrower shall give
the Agents at least 10 days' prior written notice of such sale, which notice
shall, among other things, specify the aggregate purchase price therefore, (B)
at least 75% of the consideration paid in connection therewith shall consist of
cash (excluding as cash any amounts held in reserve for adjustments, whether for
indemnification or otherwise), (C) all non-cash consideration received in
connection with such sale must be pledged to the Collateral Agent, for the
benefit of the Lenders, pursuant to documentation reasonably requested by the
Collateral Agent, and any proceeds received from such non-cash consideration
shall be paid to the Lenders when received in accordance with Section 3.3(b) and
(c), (D) the Net Cash Proceeds received in such sale are paid to the Lenders in
accordance with Section 3.3 and (E) all such sales must be for fair market
value; (e) the issuance of capital stock if the proceeds are forwarded in
accordance with Section 3.3(b) and (c); (f) the transfer of assets which
constitute a Permitted Investment; or (g) transfers permitted by Section 8.6.
Upon a sale of assets permitted by this Section 8.5, the Collateral Agent
shall promptly deliver to the Borrower, upon the Borrower's request and at the
Borrower's expense, such documentation as is reasonably necessary to evidence
the release of the Lenders' security interest in such assets, including, without
limitation, amendments or terminations of UCC financing statements.
8.6 Sale Leasebacks. No Credit Party will directly or indirectly become or
remain liable as lessee or as guarantor or other surety with respect to any
lease of any property (whether real or personal or mixed), whether now owned or
hereafter acquired, (a) which such Credit Party has sold or transferred or is to
sell or transfer to any other Person other than a Credit Party or (b) which such
Credit Party intends to use for substantially the same purpose as any other
property which has been sold or is to be sold or transferred by such Credit
Party to any Person in connection with such lease; provided, however, that the
Credit Parties may enter into such transactions (i) with respect to real
property, in an aggregate amount of up to $50,000,000 in sales proceeds during
the term of this Credit Agreement and (ii) with respect to personal property, in
an aggregate amount of up to $5,000,000 in sales proceeds during the term of
this Credit Agreement, if (I), in either case, (A) after giving pro forma effect
to any such transaction the Borrower shall be in compliance with all other
provisions of this Credit Agreement, including Sections 7.2, 8.1 and 8.2 and (B)
the gross cash proceeds of any such transaction are at least equal to the fair
market value of such property and (II) in connection with subclause (i), the Net
Cash Proceeds are forwarded to the Administrative Agent as set forth in Section
3.3(b) and (c).
8.7 Advances, Investments and Loans. No Credit Party will make any
Investments except for Permitted Investments.
8.8 Dividends. No Credit Party will directly or indirectly, (a) declare or
pay any dividends or make any other distribution upon any shares of its capital
stock of any class or (b) purchase, redeem or otherwise acquire or retire or
make any provisions for redemption, acquisition or retirement of any shares of
its capital stock of any class or any warrants or options to purchase any such
shares; provided that any Subsidiary of the Borrower may pay dividends to the
Borrower.
8.9 Transactions with Affiliates. Except for loans to employees as
permitted by Section 8.7, no Credit Party will enter into any transaction or
series of transactions, whether or not in the ordinary course of business, with
any officer, director, shareholder, Subsidiary or Affiliate other than on terms
and conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director,
shareholder, Subsidiary or Affiliate.
8.10 Fiscal Year; Organizational Documents. No Credit Party will (a) change
its fiscal year or (b) change its articles or certificate of incorporation or
its bylaws if such change would have or be reasonably expected to have a
Material Adverse Effect.
8.11 Subordinated Debt. No Credit Party will (a) make or offer to make any
principal payments with respect to the Subordinated Debt, (b) redeem or offer to
redeem any of the Subordinated Debt, or (c) deposit any funds intended to
discharge or defease any or all of the Subordinated Debt. The Subordinated Debt
shall not be amended or modified in any manner without the prior written consent
of the Required Lenders.
8.12 Limitations. No Credit Party will directly or indirectly, create or
otherwise cause, incur, assume, suffer or permit to exist or become effective
any consensual encumbrance or restriction of any kind on the ability of any such
Person to (a) pay dividends or make any other distribution on any of such
Person's capital stock, (b) pay any Indebtedness owed to the Borrower or any
other Credit Party, (c) make loans or advances to any other Credit Party or (d)
transfer any of its property to any other Credit Party, except for encumbrances
or restrictions existing under or by reason of (i) customary non-assignment or
net worth provisions in any lease governing a leasehold interest, (ii) any
agreement or other instrument of a Person existing at the time it becomes a
Subsidiary of the Borrower; provided that such encumbrance or restriction is not
applicable to any other Person, or any property of any other Person, other than
such Person becoming a Subsidiary of the Borrower and was not entered into in
contemplation of such Person becoming a Subsidiary of the Borrower, and (iii)
this Credit Agreement and the other Credit Documents.
8.13 Negative Pledges. No Credit Party will enter into, assume or become
subject to any agreement prohibiting or otherwise restricting the creation or
assumption of any Lien upon its properties or assets, whether now owned or
hereafter acquired, or requiring the grant of any security for such obligation
if security is given for some other obligation.
8.14 Capital Expenditures. The Credit Parties shall not make Capital
Expenditures in cash that would exceed, in the aggregate (a) $16 million during
the fiscal year of the Borrower ending February 2, 1997 and (b) $10 million
during the fiscal year of the Borrower ending February 1, 1998; it being
understood that for the purposes of this Section 8.14 "Capital Expenditures in
cash" shall mean all Capital Expenditures other than (i) those financed as
permitted under Section 8.1 and (ii) Capital Expenditures related to the
termination of the Existing TROL.
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default. An Event of Default shall exist upon the occurrence
of any of the following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall default in the payment (i) when
due of any principal of any of the Loans or any reimbursement
obligation arising from drawings under Letters of Credit or (ii)
within three days of when due of any interest on the Loans or any fees
or other amounts owing hereunder, under any of the other Credit
Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement made or
deemed to be made by any Credit Party herein, in any of the other
Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was made or deemed
to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 7.2, 7.3, 7.5, 7.6,
7.7, 7.10, 7.11, 7.12, 7.13, 7.14 or 8.1 through 8.14 inclusive;
or
(ii) default in the due performance or observance by it of any
term, covenant or agreement contained in Sections 7.1 and such
default shall continue unremedied for a period of five Business
Days after the earlier of an officer of a Credit Party becoming
aware of such default or notice thereof given by an Agent; or
(iii) default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) or (ii) of this Section 9.1)
contained in this Credit Agreement and such default shall
continue unremedied for a period of at least 20 days after the
earlier of an officer of a Credit Party becoming aware of such
default or notice thereof given by an Agent.
(d) Other Credit Documents. (i) Any Credit Party shall default in the
due performance or observance of any term, covenant or agreement in
any of the other Credit Documents and such default shall continue
unremedied for a period of at least 20 days after the earlier of an
officer of a Credit Party becoming aware of such default or notice
thereof given by the Agent, or (ii) any Credit Document shall fail to
be in full force and effect or any Credit Party shall so assert or any
Credit Document shall fail to give the Agents and/or the Lenders the
security interests, liens, rights, powers and privileges purported to
be created thereby.
(e) Guaranties. The guaranty given by the Credit Parties hereunder or
by any Additional Credit Party hereafter or any provision thereof
shall cease to be in full force and effect, or any guarantor
thereunder or any Person acting by or on behalf of such guarantor
shall deny or disaffirm such Guarantor's obligations under such
guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following with
respect to the Borrower or any of its Subsidiaries (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Borrower or any of its
Subsidiaries in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoint
a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Borrower or any of its Subsidiaries or for any
substantial part of its property or ordering the winding up or
liquidation of its affairs; or (ii) an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect is commenced against the Borrower or any of its
Subsidiaries and such petition remains unstayed and in effect for a
period of 60 consecutive days; or (iii) the Borrower or any of its
Subsidiaries shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment or
taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of such Person or any
substantial part of its property or make any general assignment for
the benefit of creditors; or (iv) the Borrower or any of its
Subsidiaries shall admit in writing its inability to pay its debts
generally as they become due or any action shall be taken by such
Person in furtherance of any of the aforesaid purposes.
(g) Defaults under Other Agreements. With respect to any Indebtedness
(other than Indebtedness outstanding under this Credit Agreement) of
the Borrower or any of its Subsidiaries in an aggregate principal
amount in excess of $500,000, including, without limitation, the
Subordinated Debt (i) a Credit Party shall (A) default in any payment
(beyond the applicable grace period with respect thereto, if any) with
respect to any such Indebtedness, or (B) default (after giving effect
to any applicable grace period) in the observance or performance
relating to such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which
default or other event or condition is to cause, or permit, the holder
or holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to whether any notice or
lapse of time is required) any such Indebtedness to become due prior
to its stated maturity; or (ii) any such Indebtedness shall be
declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment prior to the stated maturity
thereof; or (iii) any such Indebtedness shall mature and remain
unpaid.
(h) Judgments. One or more judgments, orders, or decrees shall be
entered against any one or more of the Credit Parties involving a
liability of $500,000 or more, in the aggregate, (to the extent not
paid or covered by insurance provided by a carrier who has
acknowledged coverage) and such judgments, orders or decrees (i) are
the subject of any enforcement proceeding commenced by any creditor or
(ii) shall continue unsatisfied, undischarged and unstayed for a
period ending on the first to occur of (A) the last day on which such
judgment, order or decree becomes final and unappealable or (B) 20
days.
(i) ERISA. The occurrence of any of the following events or
conditions: (A) any "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether
or not waived, shall exist with respect to any Plan, or any lien shall
arise on the assets of the Borrower or any of its Subsidiaries or any
ERISA Affiliate in favor of the PBGC or a Plan; (B) a Termination
Event shall occur with respect to a Single Employer Plan, which is, in
the reasonable opinion of the Administrative Agent, likely to result
in the termination of such Plan for purposes of Title IV of ERISA; (C)
a Termination Event shall occur with respect to a Multiemployer Plan
or Multiple Employer Plan, which is, in the reasonable opinion of the
Administrative Agent, likely to result in (i) the termination of such
Plan for purposes of Title IV of ERISA, or (ii) the Borrower or any of
its Subsidiaries or any ERISA Affiliate incurring any liability in
connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency (within the meaning
of Section 4245 of ERISA) of such Plan; or (D) any prohibited
transaction (within the meaning of Section 406 of ERISA or Section
4975 of the Code) or breach of fiduciary responsibility shall occur
which may subject the Borrower or any of its Subsidiaries or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower or any of its Subsidiaries
or any ERISA Affiliate has agreed or is required to indemnify any
person against any such liability.
(j) Ownership. There shall occur a Change of Control.
(k) Subordinated Debt. (i) Any holder of the Subordinated Debt
alleges, or any Governmental Authority with applicable jurisdiction
determines that the Lenders are not holders of Senior Indebtedness (as
defined in the Indenture) or (ii) the subordination provisions
creating the Subordinated Debt shall, in whole or in part, terminate,
cease to be effective or cease to be legally valid, binding and
enforceable as to any holder of the Subordinated Debt.
9.2 Acceleration; Remedies. Upon the occurrence of an Event of Default, and
at any time thereafter unless and until such Event of Default has been waived in
writing by the Required Lenders (or the Lenders as may be required hereunder),
the Administrative Agent shall, upon the request and direction of the Required
Lenders, by written notice to the Borrower, take any of the following actions
without prejudice to the rights of the Agents or any Lender to enforce its
claims against the Credit Parties, except as otherwise specifically provided for
herein:
(a) Termination of Commitments. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement
obligations arising from drawings under Letters of Credit and any and
all other indebtedness or obligations of any and every kind owing by a
Credit Party to any of the Lenders hereunder to be due whereupon the
same shall be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by
the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an
Event of Default under Section 9.1(f), they will immediately pay) to
the Administrative Agent additional cash, to be held by the
Administrative Agent, for the benefit of the Lenders, in a cash
collateral account as additional security for the LOC Obligations in
respect of subsequent drawings under all then outstanding Letters of
Credit in an amount equal to the maximum aggregate amount which may be
drawn under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and interests
created and existing under the Credit Documents, including, without
limitation, all rights and remedies existing under the Collateral
Documents, all rights and remedies against a Guarantor and all rights
of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations under Letters of Credit, all accrued
interest in respect thereof, all accrued and unpaid fees and other indebtedness
or obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Agents or the
Lenders, which notice or other action is expressly waived by the Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
9.3 Allocation of Payments After Event of Default. Notwithstanding any
other provisions of this Credit Agreement, after the occurrence and during the
continuance of an Event of Default, all amounts collected or received by an
Agent or any Lender on account of amounts outstanding under any of the Credit
Documents or in respect of the Collateral shall be paid over or delivered as
follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation reasonable attorneys' fees) of
the Agents in connection with enforcing the rights of the Lenders
under the Credit Documents and any protective advances made by the
Agents with respect to the Collateral under or pursuant to the terms
of the Collateral Documents;
SECOND, to payment of any fees owed to an Agent or a Issuing
Lender;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses, (including, without limitation, reasonable attorneys' fees)
of each of the Lenders in connection with enforcing its rights under
the Credit Documents;
FOURTH, to the payment of all accrued fees and interest payable
to the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of the
Loans and unreimbursed drawings under Letters of Credit, to the
payment or cash collateralization of the outstanding LOC Obligations
and to any principal amounts outstanding under Hedging Agreements, pro
rata, as set forth below;
SIXTH, to all other obligations which shall have become due and
payable under the Credit Documents and not repaid pursuant to clauses
"FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal
to its pro rata share (based on the proportion that the then outstanding
Loans, LOC Obligations and obligations under Hedging Agreements held by
such Lender bears to the aggregate then outstanding Loans, LOC Obligations
and obligations under Hedging Agreements) of amounts available to be
applied pursuant to clauses "THIRD", "FOURTH," "FIFTH," and "SIXTH" above;
and (c) to the extent that any amounts available for distribution pursuant
to clause "FIFTH" above are attributable to the issued but undrawn amount
of outstanding Letters of Credit, such amounts shall be held by the
Collateral Agent in a cash collateral account and applied (x) first, to
reimburse the Issuing Lender from time to time for any drawings under such
Letters of Credit and (y) then, following the expiration of all Letters of
Credit, to all other obligations of the types described in clauses "FIFTH"
and "SIXTH" above in the manner provided in this Section 9.3.
SECTION 10
AGENCY PROVISIONS
10.1 Appointment. Each Lender hereby designates and appoints Xxxxxxx Bank
of Tampa as Administrative Agent and Collateral Agent and NationsBank, N.A.
(South) as Documentation Agent of such Lender to act as specified herein and the
other Credit Documents, and each such Lender hereby authorizes the Agents, as
the agents for such Lender, to take such action on its behalf under the
provisions of this Credit Agreement and the other Credit Documents and to
exercise such powers and perform such duties as are expressly delegated by the
terms hereof and of the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere herein and in the other Credit Documents, the Agents shall
not have any duties or responsibilities, except those expressly set forth herein
and therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Credit Agreement or any of the other Credit Documents, or
shall otherwise exist against the Agents. The provisions of this Section are
solely for the benefit of the Agents and the Lenders and none of the Credit
Parties shall have any rights as a third party beneficiary of the provisions
hereof. In performing its functions and duties under this Credit Agreement and
the other Credit Documents, each Agent shall act solely as an agent of the
Lenders and does not assume and shall not be deemed to have assumed any
obligation or relationship of agency or trust with or for any Credit Party.
10.2 Delegation of Duties. An Agent may execute any of its duties hereunder
or under the other Credit Documents by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to
such duties. An Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care.
10.3 Exculpatory Provisions. Neither the Agents nor any of their officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection herewith or in connection with any of the other Credit
Documents (except for its or such Person's own gross negligence or willful
misconduct) or (b) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by any of the Credit
Parties contained herein or in any of the other Credit Documents or in any
certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by an Agent under or in
connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Agents shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any Credit Party in any written or oral
statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by an Agent to the Lenders or by or on behalf of the Credit
Parties to the Agents or any Lender or be required to ascertain or inquire as to
the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or of the existence or
possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Credit Parties. The Agents are not trustees
for the Lenders and owe no fiduciary duty to the Lenders.
10.4 Reliance on Communications. The Agents shall be entitled to rely, and
shall be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to any of the Credit Parties, independent
accountants and other experts selected by the Agents with reasonable care). The
Agents may deem and treat the Lenders as the owner of its interests hereunder
for all purposes unless a written notice of assignment, negotiation or transfer
thereof shall have been filed with the Administrative Agent in accordance with
Section 11.3(b). The Agents shall be fully justified in failing or refusing to
take any action under this Credit Agreement or under any of the other Credit
Documents unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Agents shall in all cases be fully protected in acting, or in refraining from
acting, hereunder or under any of the other Credit Documents in accordance with
a request of the Required Lenders (or to the extent specifically provided in
Section 11.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
10.5 Notice of Default. An Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has received notice from a Lender or a Credit Party referring to the
Credit Document, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders.
10.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents, NationsBanc Capital Markets, Inc. ("NCMI")
nor any of their officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Agents, NCMI or any affiliate thereof hereinafter taken, including any
review of the affairs of any Credit Party, shall be deemed to constitute any
representation or warranty by the Agents or NCMI to any Lender. Each Lender
represents to the Agents and NCMI that it has, independently and without
reliance upon the Agents or NCMI or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Agents, NCMI or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Credit
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent hereunder, the Agents
and NCMI shall not have any duty or responsibility to provide any Lender with
any credit or other information concerning the business, operations, assets,
property, financial or other conditions, prospects or creditworthiness of the
Credit Parties which may come into the possession of the Agents, NCMI or any of
their officers, directors, employees, agents, attorneys-in-fact or affiliates.
10.7 Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Commitments (or if the Commitments have expired or been terminated,
in accordance with the respective principal amounts of outstanding Loans and
Participation Interest of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against an
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by an Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of an Agent. If any indemnity furnished
to an Agent for any purpose shall, in the opinion of such Agent, be insufficient
or become impaired, such Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against until such additional indemnity
is furnished. The agreements in this Section shall survive the payment of the
Credit Party Obligations and all other amounts payable hereunder and under the
other Credit Documents.
10.8 Agents in Their Individual Capacity. Each Agent and its affiliates may
make loans to, accept deposits from and generally engage in any kind of business
with the Borrower or any other Credit Party as though such Agent were not an
Agent hereunder. With respect to the Loans made and Letters of Credit issued and
all obligations owing to it, an Agent shall have the same rights and powers
under this Credit Agreement as any Lender and may exercise the same as though
they were not an Agent, and the terms "Lender" and "Lenders" shall include each
Agent in its individual capacity.
10.9 Successor Agent. Any Agent may, at any time, resign upon 20 days
written notice to the Lenders. Upon any such resignation, the Required Lenders
shall have the right to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Required Lenders, and shall have accepted such
appointment, within 45 days after the notice of resignation, then the retiring
Agent shall select a successor Agent provided such successor is a Lender
hereunder or a commercial bank organized under the laws of the United States of
America or of any State thereof and has a combined capital and surplus of at
least $400,000,000. Upon the acceptance of any appointment as an Agent hereunder
by a successor, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations as an
Agent, as appropriate, under this Credit Agreement and the other Credit
Documents and the provisions of this Section 10.9 shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was an Agent under
this Credit Agreement.
SECTION 11
MISCELLANEOUS
11.1 Notices. Except as otherwise expressly provided herein, all notices
and other communications shall have been duly given and shall be effective (a)
when delivered, (b) when transmitted via telecopy (or other facsimile device) to
the number set out below, (c) the Business Day following the day on which the
same has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address as such party may specify by written notice to
the other parties hereto.
11.2 Right of Set-Off. In addition to any rights now or hereafter granted
under applicable law or otherwise, and not by way of limitation of any such
rights, upon the occurrence of an Event of Default and the commencement of
remedies described in Section 9.2, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation, branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party to the Lenders hereunder, under the Notes, the
other Credit Documents or otherwise, irrespective of whether the Administrative
Agent or the Lenders shall have made any demand hereunder and although such
obligations, liabilities or claims, or any of them, may be contingent or
unmatured, and any such set-off shall be deemed to have been made immediately
upon the occurrence of an Event of Default even though such charge is made or
entered on the books of such Lender subsequent thereto. The Credit Parties
hereby agree that any Person purchasing a participation in the Loans and
Commitments hereunder pursuant to Section 11.3(c) or 3.8 may exercise all rights
of set-off with respect to its participation interest as fully as if such Person
were a Lender hereunder.
11.3 Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and inure
to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests (except as
permitted by Section 8.4 or 8.5) without the prior written consent of
the Lenders; and provided further that the rights of each Lender to
transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth below in
subsections (b) and (c) of this Section 11.3. Notwithstanding the
above (including anything set forth in subsections (b) and (c) of this
Section 11.3), nothing herein shall restrict, prevent or prohibit any
Lender from (A) pledging its Loans hereunder to a Federal Reserve Bank
in support of borrowings made by such Lender from such Federal Reserve
Bank, or (B) granting assignments or participations in such Lender's
Loans and/or Commitments hereunder to its parent company and/or to any
Affiliate of such Lender or to any existing Lender or Affiliate
thereof.
(b) Assignments. Each Lender may, with the prior written consent of
the Borrower and the Agents (provided that no consent of the Borrower
shall be required during the existence and continuation of an Event of
Default), which consent shall not be unreasonably withheld or delayed,
assign all or a portion of its rights and obligations hereunder
pursuant to an assignment agreement substantially in the form of
Exhibit 11.3 to one or more Eligible Assignees; provided that (i) any
such assignment shall be in a minimum aggregate amount of $5,000,000
of the Commitments and in integral multiples of $1,000,000 above such
amount (or the remaining amount of Commitments held by such Lender)
and (ii) each such assignment shall be of a constant, not varying,
percentage of all of the assigning Lender's rights and obligations
under the Commitment being assigned. Any assignment hereunder shall be
effective upon satisfaction of the conditions set forth above and
delivery to the Administrative Agent of a duly executed assignment
agreement together with a transfer fee of $5,000 payable to the
Administrative Agent for its own account. Upon the effectiveness of
any such assignment, the assignee shall become a "Lender" for all
purposes of this Credit Agreement and the other Credit Documents and,
to the extent of such assignment, the assigning Lender shall be
relieved of its obligations hereunder to the extent of the Loans and
Commitment components being assigned. Along such lines the Borrower
agrees that upon notice of any such assignment and surrender of the
appropriate Note or Notes, it will promptly provide to the assigning
Lender and to the assignee separate promissory notes in the amount of
their respective interests substantially in the form of the original
Note or Notes (but with notation thereon that it is given in
substitution for and replacement of the original Note or Notes or any
replacement notes thereof).
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender
warrants that it is the legal and beneficial owner of the interest
being assigned thereby free and clear of any adverse claim and the
assignee warrants that it is an Eligible Assignee; (ii) except as set
forth in clause (i) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in
connection with this Credit Agreement, any of the other Credit
Documents or any other instrument or document furnished pursuant
hereto or thereto, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Credit Documents or any other instrument
or document furnished pursuant hereto or thereto or the financial
condition of any Credit Party or the performance or observance by any
Credit Party of any of its obligations under this Credit Agreement,
any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has received
a copy of this Credit Agreement, the other Credit Documents and such
other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such assignment
agreement; (v) such assignee will independently and without reliance
upon the Agents, such assigning Lender or any other Lender, and based
on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not
taking action under this Credit Agreement and the other Credit
Documents; (vi) such assignee appoints and authorizes the Agents to
take such action on its behalf and to exercise such powers under this
Credit Agreement or any other Credit Document as are delegated to the
Agents by the terms hereof or thereof, together with such powers as
are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all the obligations
which by the terms of this Credit Agreement and the other Credit
Documents are required to be performed by it as a Lender.
(c) Participations. Each Lender may sell, transfer, grant or assign
participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under this Credit Agreement (such
selling Lender's obligations under the Credit Documents remaining
unchanged) and the participant shall not constitute a Lender
hereunder, (ii) no such participant shall have, or be granted, rights
to approve any amendment or waiver relating to this Credit Agreement
or the other Credit Documents except to the extent any such amendment
or waiver would (A) reduce the principal of or rate of interest on or
fees in respect of any Loans in which the participant is participating
or increase any Commitments with respect thereto, (B) postpone the
date fixed for any payment of principal (including the extension of
the final maturity of any Loan or the date of any mandatory
prepayment), interest or fees in which the participant is
participating, or (C) release all or substantially all of the
collateral or guaranties (except as expressly provided in the Credit
Documents) supporting any of the Loans or Commitments in which the
participant is participating, (iii) sub-participations by the
participant (except to an Affiliate, parent company or Affiliate of a
parent company of the participant) shall be prohibited and (iv) any
such participations shall be in a minimum aggregate amount of
$5,000,000 of the Commitments and in integral multiples of $1,000,000
in excess thereof. In the case of any such participation, the
participant shall not have any rights under this Credit Agreement or
the other Credit Documents (the participant's rights against the
selling Lender in respect of such participation to be those set forth
in the participation agreement with such Lender creating such
participation) and all amounts payable by the Borrower hereunder shall
be determined as if such Lender had not sold such participation;
provided, however, that such participant shall be entitled to receive
additional amounts under Sections 3.9, 3.12, 3.13 and 3.14 to the same
extent that the Lender from which such participant acquired its
participation would be entitled to the benefit of such cost protection
provisions.
11.4 No Waiver; Remedies Cumulative. No failure or delay on the part of an
Agent or any Lender in exercising any right, power or privilege hereunder or
under any other Credit Document and no course of dealing between the Borrower or
any Credit Party and the Agents or any Lender shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or privilege
hereunder or under any other Credit Document preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein are cumulative
and not exclusive of any rights or remedies which the Agents or any Lender would
otherwise have. No notice to or demand on any Credit Party in any case shall
entitle any Credit Party to any other or further notice or demand in similar or
other circumstances or constitute a waiver of the rights of the Agents or the
Lenders to any other or further action in any circumstances without notice or
demand.
11.5 Payment of Expenses; Indemnification. The Credit Parties agree to: (a)
pay all reasonable out-of-pocket costs and expenses of (i) the Agents and
NationsBanc Capital Markets, Inc. ("NCMI") in connection with (A) the
negotiation, preparation, execution and delivery and administration of this
Credit Agreement and the other Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and expenses of Xxxxx & Xxx Xxxxx, special counsel to the Agents and the
fees and expenses of counsel for the Agents in connection with collateral
issues), and (B) any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Credit Parties under this Credit Agreement and (ii)
the Agents and the Lenders in connection with (A) enforcement of the Credit
Documents and the documents and instruments referred to therein, including,
without limitation, in connection with any such enforcement, the reasonable fees
and disbursements of counsel for the Agents and each of the Lenders, and (B) any
bankruptcy or insolvency proceeding of a Credit Party of any of its Subsidiaries
and (b) indemnify each Agent, NCMI and each Lender, its officers, directors,
employees, representatives and agents from and hold each of them harmless
against any and all losses, liabilities, claims, damages or expenses incurred by
any of them as a result of, or arising out of, or in any way related to, or by
reason of, any investigation, litigation or other proceeding (whether or not any
Agent, NCMI or Lender is a party thereto) related to (i) the entering into
and/or performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any
other transactions contemplated in any Credit Document, including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding (but
excluding any such losses, liabilities, claims, damages or expenses to the
extent incurred by reason of gross negligence or willful misconduct on the part
of the Person to be indemnified), (ii) any Environmental Claim and (iii) any
claims for Non-Excluded Taxes or Florida Taxes.
11.6 Amendments, Waivers and Consents. Neither this Credit Agreement nor
any other Credit Document nor any of the terms hereof or thereof may be amended,
changed, waived, discharged or terminated unless such amendment, change, waiver,
discharge or termination is in writing and signed by the Required Lenders and
the then Credit Parties; provided that no such amendment, change, waiver,
discharge or termination shall without the consent of each Lender affected
thereby:
(a) extend the final maturity of any Loan or any portion thereof or
postpone any other date fixed for any payment of principal;
(b) reduce the rate or extend the time of payment of interest (other
than as a result of waiving the applicability of any post-default
increase in interest rates) thereon or fees hereunder;
(c) reduce or waive the principal amount of any Loan;
(d) increase the Commitment of a Lender over the amount thereof in
effect (it being understood and agreed that a waiver of any Default or
Event of Default or a waiver of any mandatory reduction in the
Commitments shall not constitute a change in the terms of any
Commitment of any Lender);
(e) release all or substantially all of the Collateral securing the
Credit Party Obligations hereunder (provided that the Collateral Agent
may, without consent from any other Lender, release any Collateral
that is sold or transferred by a Credit Party in conformance with
Section 8.5);
(f) release the Borrower or any of the other Credit Parties from its
obligations under the Credit Documents;
(g) amend, modify or waive any provision of this Section or Section
3.4(a), 3.4(b)(i), 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14,
9.1(a), 11.2, 11.3 or 11.5;
(h) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders;
(i) consent to the assignment or transfer by the Borrower or of any of
its rights and obligations under (or in respect of) the Credit
Documents except as permitted under Section 8.4; or
(j) modify or amend the definition of the term "Borrowing Base Assets"
in Section 1.1 in a manner that would (i) increase the percentage as
to Eligible Inventory above 65%, (ii) increase the percentage as to
Eligible Real Estate above 75% or (iii) increase the percentage as to
Eligible Equipment in any amount.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans or the
Letters of Credit, and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions set
forth herein and (y) the Required Lenders may consent to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts. This Credit Agreement may be executed in any number of
counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Credit Agreement to produce or
account for more than one such counterpart.
11.8 Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Credit Agreement.
11.9 Defaulting Lender. Each Lender understands and agrees that if such
Lender is a Defaulting Lender then notwithstanding the provisions of Section
11.6 it shall not be entitled to vote on any matter requiring the consent of the
Required Lenders or to object to any matter requiring the consent of all the
Lenders; provided, however, that all other benefits and obligations under the
Credit Documents shall apply to such Defaulting Lender.
11.10 Survival of Indemnification and Representations and Warranties. All
indemnities set forth herein and all representations and warranties made herein
shall survive the execution and delivery of this Credit Agreement, the making of
the Loans, the issuance of the Letters of Credit and the repayment of the Loans,
LOC Obligations and other obligations and the termination of the Commitments
hereunder.
11.11 Governing Law; Jurisdiction.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF FLORIDA. Any legal action or proceeding with respect to this
Agreement or any other Credit Document may be brought in the courts of
the State of Florida (including the Hillsborough County, Florida
Circuit Court) or of the United States for the Middle District of
Florida, Tampa division and, by execution and delivery of this Credit
Agreement, each Credit Party hereby irrevocably accepts for itself and
in respect of its property, generally and unconditionally, the
jurisdiction of such courts. Each Credit Party further irrevocably
consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the
address for notices pursuant to Section 11.1, such service to become
effective 15 days after such mailing. Nothing herein shall affect the
right of a Lender to serve process in any other manner permitted by
law or to commence legal proceedings or to otherwise proceed against a
Credit Party in any other jurisdiction. Each Credit Party agrees that
a final judgment in any action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in
any other manner provided by law; provided that nothing in this
Section 11.11(a) is intended to impair a Credit Party's right under
applicable law to appeal or seek a stay of any judgment.
(b) Each Credit Party hereby irrevocably waives any objection which it
may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Agreement or any other Credit Document brought in the courts
referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought
in an inconvenient forum.
11.12 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE
OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
11.13 Time. All references to time herein shall be references to Eastern
Standard Time or Eastern Daylight time, as the case may be, unless specified
otherwise.
11.14 Severability. If any provision of any of the Credit Documents is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
11.15 Entirety. This Credit Agreement together with the other Credit
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
11.16 Binding Effect. This Credit Agreement shall become effective at such
time when all of the conditions set forth in Section 5.1 have been satisfied or
waived by the Lenders and it shall have been executed by the Borrower, the
Guarantors and the Agents, and the Agents shall have received copies hereof
(telefaxed or otherwise) which, when taken together, bear the signatures of each
Lender, and thereafter this Credit Agreement shall be binding upon and inure to
the benefit of the Borrower, the Guarantors, the Agents and each Lender and
their respective successors and assigns.
11.17 Confidentiality. Each Lender agrees that it will use its reasonable
best efforts to keep confidential and to cause any representative designated
under Section 7.12 to keep confidential any non-public information from time to
time supplied to it under any Credit Document; provided, however, that nothing
herein shall prevent the disclosure of any such information to (a) the extent a
Lender in good faith believes such disclosure is required by Requirement of Law,
(b) counsel for a Lender or to its accountants, (c) bank examiners or auditors
or comparable Persons, (d) any affiliate of a Lender, (e) any other Lender, or
any assignee, transferee or participant, or any potential assignee, transferee
or participant, of all or any portion of any Lender's rights under this
Agreement who is notified of the confidential nature of the information or (f)
any other Person in connection with any litigation to which any one or more of
the Lenders is a party; and provided further that no Lender shall have any
obligation under this Section 11.17 to the extent any such information becomes
available on a non-confidential basis from a source other than a Credit Party or
that any information becomes publicly available other than by a breach of this
Section 11.17.
