AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
Dated as of May 4, 1999
By and Among
NUCO2 INC.,
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL ASSOCIATTION
the banks or other lending institutions signatory hereto from time to time
and
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL ASSOCIATION,
as Agent for the Lenders
and
SUNTRUST EQUITABLE SECURITIES CORPORATION,
as Arranger
TABLE OF CONTENTS
ARTICLE 1 .................................................. DEFINITIONS 1
Definitions .............................................................1
Calculations. Accounting Terms..........................................18
Other Definitional Provisions...........................................19
Captions................................................................19
ARTICLE II .....................................AMOUNT AND TERMS OF LOANS 19
Revolving Loan Commitments and Revolving Notes..........................19
Method of Borrowing Under the Commitments...............................21
Swing Line Subcommitment................................................22
Letter of Credit Subcommitment..........................................23
Notice of Issuance of Letter of Credit; Agreement to Issue..............23
Payment of Amounts drawn under Letter of Credit.........................24
Payment by Lenders......................................................25
Obligations Absolute....................................................25
Indemnification; Nature of Agent's Duties...............................26
Prepayment of Borrowings Under the Commitments..........................26
Mandatory Prepayments...................................................26
Voluntary Reduction of Commitments......................................27
Allocation of Payments..................................................28
Termination of Commitments..............................................28
Use of Proceeds.........................................................28
Fees....................................................................28
Interest................................................................29
Interest Periods........................................................29
Extension of Commitments................................................30
Increased Costs.........................................................31
Capital Adequacy........................................................32
Funding Losses..........................................................33
Making of Payments......................................................33
Default Rate of Interest................................................33
Proration of Payments...................................................34
Lenders' Obligations Several............................................34
Calculation of Interest.................................................34
Payments Free of Taxes..................................................34
Interest Rate Not Ascertainable, etc....................................35
Illegality..............................................................35
ARTICLE III.....................................CONDITIONS TO BORROWINGS 36
Conditions Precedent to Initial Advances................................36
Conditions Precedent to Each Advance and Letters of Credit..............39
ARTICLE IV.................................REPRESENTATIONS AND WARRANTIES 40
Corporate Status of Company; Status of Subsidiaries.....................40
Corporate Power and Authority...........................................41
ii
Compliance with Other Instruments.......................................41
Enforceable Obligations.................................................41
Governmental Authorizations.............................................41
Intellectual Property...................................................42
Outstanding Indebtedness................................................42
Insurance Coverage......................................................42
Title to Properties.....................................................42
No Burdensome Restrictions..............................................43
No Material Violation of Law............................................43
No Default Under Other Agreements.......................................43
No Equity Investments...................................................43
Financial Statements....................................................43
Litigation..............................................................44
Taxes...................................................................44
Margin Regulations......................................................44
ERISA...................................................................44
Compliance With Environmental Laws......................................45
Possession of Material Patents, Trademarks, Etc. .......................45
Subsidiaries............................................................46
Disclosure..............................................................46
Year 2000 Compliance....................................................46
Projections.............................................................46
ARTICLE V ...................................AFFIRMATIVE COVENANTS 47
Use of Proceeds.........................................................47
Reporting Covenants.....................................................47
Maintenance of Properties...............................................48
Maintenance of Insurance................................................48
Maintenance of Books; Inspection of Property and Records................49
Existence and Status....................................................49
Taxes and Claims........................................................49
Compliance with Laws, Etc...............................................50
ERISA...................................................................50
Litigation..............................................................50
Notice of Events of Default.............................................51
Stockholder Reports, etc. ..............................................51
Future Guarantors.......................................................51
Ownership of Guarantors.................................................51
Interest Rate Protection................................................52
Cost of Products Sold...................................................52
ARTICLE VI....................................NEGATIVE COVENANTS 52
Limitation on Liens and Security Interests..............................52
Indebtedness............................................................53
Compliance with ERISA...................................................54
Sale and Leaseback......................................................54
iii
Transactions with Affiliates............................................54
Guaranties..............................................................55
Limitations on Payment Restrictions.....................................55
Merger; Joint Ventures; Sale of Assets; Acquisitions....................55
Dividends; Loans, Advances..............................................56
Nature of Business......................................................57
Sale of Subsidiaries....................................................57
Negative Pledges........................................................57
Creation of Subsidiaries................................................57
Prepayments Under and Amendment of Other Agreements.....................57
Capital Expendires......................................................58
ARTICLE VII....................................FINANCIAL COVENANTS 58
Senior Debt Coverage Ratio..............................................58
Interest Coverage Ratio.................................................58
Senior Debt Leverage Ratio..............................................58
Minimum Net Worth.......................................................58
ARTICLE VIII.............................EVENTS OF DEFAULT AND REMEDIES 59
Events of Default.......................................................59
Remedies on Default.....................................................61
ARTICLE IX.............................................THE AGENT 61
Appointment and Authorization...........................................61
Nature of Duties of the Agent...........................................62
Lack of Reliance on the Agent...........................................62
Certain Rights of the Agent.............................................62
Liability of the Agent..................................................63
Indemnification.........................................................64
Agent and Affiliates....................................................65
Successor Agent.........................................................65
ARTICLE X............................................MISCELLANEOUS 65
Survival................................................................65
Amendments; Consents....................................................66
Notices.................................................................66
Severability; Time of Essence...........................................68
Governing Law; Submission to Jurisdiction...............................68
Payment of Costs........................................................69
Indemnity...............................................................69
Benefit of the Agreement................................................69
Subordination of Indebtedness...........................................70
Maximum Interest Rate...................................................71
Entire Agreement........................................................71
Set-Off.................................................................71
Counterparts............................................................72
Replacement Notes.......................................................72
Release.................................................................72
iv
Annexes
Annex A - Projected Gross Margin
Annex B - Capital Expenditures
Exhibits
Exhibit A - Form of Revolving Note
Exhibit B - Form of Swing Line Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Guaranty Agreement
Exhibit E - Form of Contribution Agreement
Exhibit F - Form of Closing Certificate
Exhibit G - Form of Opinion of Counsel of the Company and the
Guarantors
Exhibit H - Form of Florida Counsel Opinion
Exhibit I - Form of Compliance Certificate
Exhibit J - Form of Assignment Agreement
Exhibit K - Form of Borrowing Base Certificate
Exhibit L - Form of Depot Report
Exhibit M - Projections
Schedules
Schedule 1.01 - Calculation of Cost of Products Sold
Schedule 4.07 - Outstanding Indebtedness
Schedule 4.08 - Insurance Certificates
Schedule 4.15 - Litigation
Schedule 4.18 - ERISA
Schedule 4.19 - Environmental Liability
Schedule 4.21 - Subsidiaries
Schedule 6.01 - Liens
v
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of May
4, 1999, by and among NUCO2 INC., a Florida corporation (the "Company"),
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL ASSOCIATION, a national banking
association ("SunTrust"), BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE, INC., a
Delaware corporation (the "Documentation Agent"), THE PROVIDENT BANK, an Ohio
banking corporation, BANK LEUMI LE-ISRAEL B.M., Miami Agency, and any other
banks or other lending institutions that are or will become parties to this
Agreement (collectively, the "Lenders" and each individually, a "Lender"), and
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL ASSOCIATION, as agent for the Lenders.
W I T N E S S E T H :
WHEREAS, the Company, the Agent and the Lenders entered into that
certain Revolving Credit Agreement, dated as of October 31, 1997 (the "Existing
Credit Agreement");
WHEREAS, the Company has requested, and the Lenders have agreed to
amend and restate the Existing Credit Agreement to increase the revolving credit
facility available to the Company, to add a letter of credit facility and to
make certain other amendments on the terms and subject to the conditions set
forth herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. In addition to the other terms defined
herein, the following terms used herein shall have the meanings herein specified
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
"Additional Guarantor" shall have the meaning assigned to such term in
Section 5.13(a).
"Advance" shall mean any advance by a Lender under the Commitments.
"Agent" shall mean SunTrust Bank, South Florida, National Association,
as agent for the Lenders hereunder and under the other Loan Documents, and each
successor agent.
"Agent Fee" shall mean the administrative fee described in the Fee
Letter, payable on the Closing Date and thereafter annually in advance to the
Agent during the period prior to the Commitment Termination Date.
"Affiliate" shall mean, with respect to any Person, any other Person
that, directly or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, such first Person. A Person
shall be deemed to control another Person if such first Person possesses,
directly or indirectly, the power to direct or cause the direction of the
management and policies of such other Person, whether through the ownership of
voting securities, by contract or otherwise.
"Agreement" shall mean this Amended and Restated Revolving Credit
Agreement, either as originally executed or as hereafter amended, restated,
renewed, extended, supplemented or otherwise modified from time to time.
"Annualized EBITDA" shall mean EBITDA for the fiscal quarter ending on
the last day of such quarter, multiplied by four.
"Applicable Commitment Fee Percentage" shall mean the percentage
designated below based on the ratio of the Company's Senior Funded Debt to
Annualized EBITDA for each fiscal quarter-end, as indicated below, provided,
that, for purposes of this calculation, the term "Senior Funded Debt" shall
include the Letter of Credit Obligations and aggregate outstanding amount of all
Swing Line Loans:
Senior Funded Debt to Applicable Commitment
Annualized EBITDA Fee Percentage
----------------- --------------
Less than 1.50:1.0 0.375%
Greater than or equal to 1.50:1.0 0.375%
and less than 2.00:1.0
Greater than or equal to 2.00:1.0 0.375%
and less than 2.50:1.0
Greater than or equal to 2.50:1.0 and less than 3.00:1.00 0.50%
Greater than or equal to 3.00:1.00 and less than 3.25:1.0 0.50%
Greater than or equal to 3.25:1.0 0.50%
2
From the Closing Date through and including September 30, 1999, the Applicable
Commitment Fee Percentage shall be 0.50%.
"Applicable Law" shall mean, anything in Section 10.05 notwithstanding,
(i) all applicable common law and principles of equity and (ii) all applicable
provisions of all (a) constitutions, statutes, rules, regulations and orders of
governmental bodies, (b) Governmental Approvals, and (c) orders, decisions,
judgments and decrees of all courts and arbitrators.
"Applicable Margin" shall mean the percentage designated below based on
the ratio of the Company's Senior Funded Debt to Annualized EBITDA for each
fiscal quarter-end, as indicated below:
Senior Funded Debt to Applicable Margin Applicable Margin
Annualized EBITDA (LIBOR Advance) (Base Rate Advance)
----------------- --------------- -------------------
Less than 1.50:1.0 1.75% 0.25%
Greater than or equal to 1.50:1.0 2.25% 0.75%
and less than 2.00:1.0
Greater than or equal to 2.00:1.0 2.75% 1.25%
and less than 2.50:1.0
Greater than or equal to 2.50:1.0
and less than 3.00:1.0 3.00% 1.50%
Greater than or equal to 3.00:1.0
and less than 3.25:1.0 3.25% 1.75%
Greater than or equal to 3.25:1.0 3.50% 2.00%
From the Closing Date through and including December 31, 1999, the Applicable
Margin on LIBOR Advances and Base Rate Advances shall be 3.50% and 2.00%
respectively.
"Asset Value" shall mean, with respect to any property or asset of the
Company or any of its Subsidiaries as of any particular date, an amount equal to
the greater of (i) the then book value of such property or asset as established
in accordance with GAAP, and (ii) the then fair market value of such property or
asset as determined in good faith by the board of directors of the Company or
such Subsidiary.
"Assignment Agreement" shall mean an agreement in the form of Exhibit
J.
3
"Assignment of Leases" shall mean that certain Assignment of Leases
agreement, dated as of October 31, 1997, executed by the Company and each
Subsidiary in favor of the Agent, assigning the Company's and each Subsidiary's
lessee's interest in any leasehold (except those leaseholds whose terms prohibit
assignments), as the same may be hereafter amended, restated, renewed, extended,
supplemented or otherwise modified from time to time.
"Availability" shall mean, with respect to any Commitment, at any time,
the amount by which such Commitment exceeds all Advances outstanding under such
Commitment.
"Bankruptcy Law" shall mean laws governing bankruptcy, suspension of
payments, reorganization, arrangement, adjustment of debts, relief of debtors,
dissolution, or other similar laws relating to the enforcement of creditors'
rights generally.
"Base Rate" shall mean the higher of (i) the rate which SunTrust
designates from time to time as its prime lending rate, as in effect from time
to time, and (ii) the Federal Funds Rate, as in effect from time to time, plus
one-half of one percent (0.50%) per annum (any changes in such rates to be
effective as of the date of any change in such rate). The SunTrust prime lending
rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer. SunTrust may make commercial loans or
other loans at rates of interest at, above, or below the SunTrust prime lending
rate.
"Base Rate Advance" shall mean any Advance made to the Company by the
Lenders at an interest rate equal to the Base Rate plus the Applicable Margin
for such Advance.
"Borrowing" shall mean a borrowing under the Commitments consisting of
simultaneous Advances by the Lenders, including Swing Line Borrowings.
"Borrowing Base" shall mean the product of (i) Gross Margin Factor
multiplied by the EBITDA Multiple, and (ii) the sum of EBITDA for the prior
three calendar months, multiplied by four.
"Borrowing Base Certificate" shall have the meaning set forth in
Section 5.02(a)(iv).
"Business Day" shall mean a day of the year other than Saturday, Sunday
or any other day on which the Agent is required to close.
"Capital Expenditures" shall mean, for any period, expenditures made by
the Company and its Subsidiaries to acquire or construct fixed assets, property,
plant
4
and equipment (including renewals, improvements and replacements, but excluding
repairs) during such period computed in accordance with GAAP.
"CERCLA" shall mean the Comprehensive Environmental Response
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act (42 U.S.C. ss. 9601 et seq.).
A "Change in Control" shall be deemed to have occurred if (a) any
"person" or "group" (within the meaning of Sections 13(d) and 14(d)(2) of the
Exchange Act) shall become the "beneficial owner(s)" (as defined in said Rule
13d-3) of more than forty percent (40%) of the shares of the outstanding common
stock of the Company entitled to vote for members of the Company's board of
directors; (b) a majority of the seats (other than vacant seats) on the board of
directors of the Company shall at any time be occupied by persons who were
neither (i) nominated by the board of directors of the Company, nor (ii)
appointed by directors so nominated; (c) any event or condition shall occur or
exist which requires or permits the holder(s) of Indebtedness of the Company to
require that such Indebtedness be redeemed, repurchased, defeased, prepaid or
repaid, in whole or in part, or the maturity of such Indebtedness to be
accelerated in any respect as a result of a change in control provision of such
Indebtedness; or (d) any person or group (other than the group in control of the
Company on the date hereof) shall otherwise directly or indirectly control the
Company.
"Closing Date" shall mean May 4, 1999.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
"Collateral" shall mean all real and personal property and assets, now
or hereafter existing, of the Company and its Subsidiaries over which the
Company or such Subsidiary has granted a Lien to the Agent pursuant to the
Security Documents, and all proceeds and products thereof.
"Commitments" shall mean, collectively, the Revolving Loan Commitments,
the Letter of Credit Subcommitment and the Swing Line Subcommitment.
"Commitment Fee" shall have the meaning set forth in Section 2.16(c).
"Commitment Letter" means that certain letter agreement, dated as of
March 12, 1999, executed by SunTrust and SunTrust Equitable Securities
Corporation, and accepted and agreed to by the Company.
"Commitment Termination Date" shall have the meaning set forth in
Section 2.01.
5
"Company" shall have the meaning set forth in the first paragraph of
this Agreement.
"Company Pledge Agreement" shall mean that certain Stock and Notes
Pledge Agreement (Company), dated as of October 31, 1997, executed by the
Company in favor of the Agent, as amended by the First Amendment to Stock and
Notes Pledge Agreement (Company), dated as of the date hereof, and as hereafter
amended, restated, supplemented or otherwise modified from time to time.
"Company Security Agreement" shall mean that certain Security Agreement
(Company), dated as of October 31, 1997, executed by the Company in favor of the
Agent, as amended by the First Amendment to Security Agreement (Company), dated
as of the date hereof, and as hereafter amended, restated, supplemented or
otherwise modified from time to time.
"Company Trademark Security Agreement" shall mean that certain
Trademark Security Agreement (Company), dated as of October 31, 1997, executed
by the Company in favor of the Agent, as amended by the First Amendment to
Trademark Security Agreement (Company), dated as of the date hereof, and as
hereafter amended, restated, supplemented or otherwise modified from time to
time.
"Compliance Certificate" shall have the meaning set forth in Section
5.02(a)(ii).
"Consolidated Companies" shall mean, collectively, the Company and all
of its Subsidiaries.
"Consolidated EBIT" shall mean, for any fiscal period of the Company,
an amount equal to the sum of (a) Consolidated Net Income (Loss), plus (b) to
the extent deducted in determining Consolidated Net Income (Loss), (i)
provisions for taxes based on income of the Company and its Subsidiaries
determined on a consolidated basis in accordance with GAAP, (ii) Interest
Expense, and (iii) extraordinary items determined according to GAAP.
"Consolidated Net Income (Loss)" shall mean, for any fiscal period of
the Company, the net income (or loss) of the Company and its Subsidiaries
determined on a consolidated basis for such period (taken as a single accounting
period), in accordance with GAAP.
"Consolidated Net Worth" shall mean, as of the date of determination,
the total shareholders' equity of the Company and its Subsidiaries, determined
in accordance with GAAP.
6
"Contractual Obligations" of any Person shall mean any provision of any
security issued by such Person or of any agreement, instrument or undertaking
under which such Person is obligated or by which it or any of its property is
bound.
"Contribution Agreement" shall mean that certain Amended and Restated
Contribution Agreement, dated as of the date hereof, executed by the Company and
each of the Guarantors, a copy of which is attached hereto as Exhibit E attached
hereto, as hereafter amended, restated, supplemented or otherwise modified from
time to time.
"Cost of Products Sold" shall mean the Company's cost of products sold
determined on a consolidated basis in accordance with GAAP as reported from time
to time, and including all of the line items listed on Schedule 1.01.
"Default" shall mean any event that, with the giving of notice, or
lapse of time, or both, would constitute an Event of Default.
"Depot" shall mean a location leased or owned by the Company for the
storage of raw materials, supplies and motor vehicles used in the distribution
of the Company's products.
"Depot by Depot Report" shall have the meaning set forth in Section
5.02(a)(vii).
"EBITDA" shall mean, for any period of the Company, an amount equal to
the sum of Consolidated EBIT plus (i) depreciation and amortization expenses to
the extent deducted in determining such Consolidated EBIT as determined on a
consolidated basis in accordance with GAAP, and (ii) the historical Consolidated
EBITDA of any Person for such period which accrued prior to the date such Person
became a Subsidiary of the Company or was merged into or consolidated with the
Company or any of its Subsidiaries or such Person's assets were acquired by the
Company or any of its Subsidiaries (and the underlying records of such Person
shall be audited to the extent the Company is required pursuant to Regulation
S-X of the SEC to present audited financial information for such Person in
documents filed by it with the SEC). If audited financial records are not
available for acquired companies, pro forma financial statements (subject to
review and acceptance by the Required Lenders) will be substituted.
"EBITDA Multiple" shall mean (i) 3.65 for the period beginning on the
Closing Date through and including July 31, 1999; (ii) 3.55 for the period
beginning August 1,1999 through and including August 31, 1999; (iii) 3.45 for
the period beginning September 1,1999 through and including September 30, 1999;
(iv) 3.35 for the period beginning October 1,1999 through and including October
31, 1999; (v) 3.25 for the period beginning November 1,1999 through and
including November 30, 1999; (vi) 3.15 for the period beginning December 1, 1999
to December 31, 1999; (vii) 3.0 for the period beginning January 1, 2000 through
and including March 31, 2000; (viii) 2.75 for the period beginning April 1, 2000
through and including June 30, 2000; and (ix) 2.50 thereafter.
7
"Environmental Laws" shall mean all federal, state, local and foreign
statutes and codes or regulations, rules or ordinances issued, promulgated, or
approved thereunder, now or hereafter in effect (including, without limitation,
those with respect to asbestos or asbestos containing material or exposure to
asbestos or asbestos containing material), relating to pollution or protection
of the environment and relating to public health and safety, relating to (i)
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or industrial toxic or hazardous constituents,
substances or wastes, including without limitation, any Hazardous Substance (as
such term is defined under CERCLA), petroleum including crude oil or any
fraction thereof, any petroleum product or other waste, chemicals or substances
regulated by any Environmental Law into the environment (including without
limitation, ambient air, surface water, ground water, land surface or subsurface
strata), or (ii) the manufacture, processing, distribution, use, generation,
treatment, storage, disposal, transport or handling of any Hazardous Substance
(as such term is defined under CERCLA), petroleum including crude oil or any
fraction thereof, any petroleum product or other waste, chemicals or substances
regulated by any Environmental Law, and (iii) underground storage tanks and
related piping, and emissions, discharges and releases or threatened releases
therefrom, such Environmental Laws to include, without limitation (i) the Clean
Air Act (42 U.S.C. ss. 7401 et seq.), (ii) the Clean Water Act (33 U.S.C. ss.
1251 et seq.), (iii) the Resource Conservation and Recovery Act (42 U.S.C. ss.
6901 et seq.), (iv) the Toxic Substances Control Act (15 U.S.C. ss. 2601 et
seq.) and (v) CERCLA.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974
and all rules and regulations promulgated pursuant thereto, as the same may from
time to time be supplemented or amended.
"ERISA Affiliate" shall mean any trade or business (whether
incorporated or unincorporated) which together with the Company is treated as a
single employer under Section 414(b), (c), (m) or (o) of the Code.
"Event of Default" shall have the meaning set forth in Article VIII.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute thereto.
"Executive Officer" shall mean each of the executive officers of the
Company and any Person hereafter holding the following office or offices which,
individually or collectively, are assigned substantially similar duties:
Chairman, Chief Executive Officer, Chief Financial Officer, and Chief Operating
Officer.
"Existing Credit Agreement" shall have the meaning set forth in the
first recital.
"Facilities" shall mean, collectively, the Commitments described
hereunder.
8
"Federal Funds Rate" shall mean, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of Atlanta, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.
"Fee Letter" means that certain letter agreement, dated as of March 12,
1999, executed by SunTrust and SunTrust Equitable Securities Corporation, and
accepted and agreed to by the Company, setting forth certain nonrefundable fees
payable by the Company.
"Fees" shall mean, collectively, the Agent Fee, the Underwriting Fee,
the Commitment Fee and the Letter of Credit Fee.
"GAAP" shall mean generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession in the United States of America, which are applicable
to the circumstances as of the date of determination.
"Governmental Approval" shall mean any order, permission,
authorization, consent, approval, license, franchise, permit or validation of,
exemption by, registration or filing with, or report or notice to, any
governmental agency or unit, or any public commission, board or authority.
"Gross Margin" shall mean, with respect to the Company and its
Subsidiaries on a consolidated basis for any period, the ratio of (a) (i) Total
Revenues less (ii) Cost of Products Sold to (b) Total Revenues.
"Gross Margin Factor" shall mean, with respect to the Company and its
Subsidiaries on a consolidated basis for any period, the ratio of (i) the
average of the Gross Margin for each month of the most recently reported rolling
three-month period to (ii) the average of the Projected Gross Margin for each
month of such rolling three-month period.
"Guarantor Pledge Agreement" shall mean that certain Stock and Notes
Pledge Agreement (Guarantors), dated as of October 31, 1997, executed by each
Guarantor in favor of the Agent, as amended by the First Amendment to Stock and
Notes Pledge
9
Agreement (Guarantors), dated as of the date hereof, and as hereafter amended,
restated, supplemented or otherwise modified from time to time.
"Guarantor Security Agreement" shall mean that certain Security
Agreement (Guarantors), dated as of October 31, 1997, executed by each Guarantor
in favor of the Agent, as amended by the First Amendment to Security Agreement
(Guarantors), dated as of the date hereof, and as hereafter amended, restated,
supplemented or otherwise modified from time to time.
"Guarantor Trademark Security Agreement" shall mean that certain
Trademark Security Agreement (Guarantors), dated as of October 31, 1997,
executed by each Guarantor in favor of the Agent, as amended by the First
Amendment to Trademark Security Agreement (Guarantors), dated as of the date
hereof, and as hereafter amended, restated, supplemented or otherwise modified
from time to time.
"Guarantors" shall mean, collectively, each Subsidiary of the Company
that has executed a Guaranty Agreement as of the Closing Date, together with all
other Subsidiaries that hereafter execute a Guaranty Agreement, and their
respective successors and permitted assigns. "Guarantor" shall mean any of the
Guarantors.
"Guaranty Agreement" shall mean that certain Amended and Restated
Guaranty Agreement, dated as of the date hereof, executed by each of the
Guarantors in favor of the Lenders and the Agent, a copy of which is attached
hereto as Exhibit D attached hereto, as hereafter amended, restated,
supplemented or otherwise modified from time to time.
"Guaranty Documents" shall mean, collectively, the Guaranty Agreement,
and each other guaranty agreement, mortgage, deed of trust, assignment of lease,
security agreement, pledge agreement, or other security or collateral document
guaranteeing or securing the Obligations, as the same may be amended, restated,
or supplemented from time to time, and the Contribution Agreement executed by
each of the Guarantors, as the same may be amended, restated or supplemented
from time to time.
"Guaranty Obligations" shall mean the obligation of the Guarantors to
the Lenders and the Agent, as set forth in the Guaranty Agreement.
"Hazardous Substance" shall have the meaning assigned to that term in
CERCLA.
"Indebtedness" shall mean (i) indebtedness for borrowed money or for
the deferred purchase price of property or services (other than trade accounts
payable on customary terms in the ordinary course of business), (ii) financial
obligations evidenced by bonds, debentures, notes or other similar instruments,
(iii) financial obligations as lessee under leases which shall have been or
should be, in accordance with GAAP, recorded as capital leases, (iv) financial
obligations as the issuer of capital stock
10
redeemable in whole or in part at the option of any Person other than such
issuer, at a fixed and determinable date or upon the occurrence of an event or
condition not solely within the control of such issuer, (v) all obligations
(contingent or otherwise) with respect to interest rate and currency leasing
agreements, (vi) reimbursement obligations (contingent or otherwise) with
respect to amounts under letters of credit, bankers acceptances and similar
instruments, (vii) financial obligations under purchase money mortgages, (viii)
financial obligations under asset securitization vehicles, (ix) conditional sale
contracts and similar title retention instruments with respect to property
acquired, and (x) obligations under direct or indirect guaranties in respect of,
and obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
financial obligations of others of the kinds referred to in clauses (i) through
(ix) above, except to the extent such guaranties are limited to a lesser amount.
"Interest Coverage Ratio" shall mean, for any fiscal period of the
Company, the ratio of (a) (i) EBITDA for the fiscal period ending on the last
day of such period, minus (ii) Maintenance Capital Expenditures for the fiscal
period ending on the last day of such period, to (b) Interest Expense for the
fiscal period ending on the last day of such period.
"Interest Expense" shall mean, for any fiscal period of the Company,
total interest expense (including, without limitation, interest expense
attributable to capitalized leases in accordance with GAAP) of the Company and
its Subsidiaries, on a consolidated basis, for such period.
"Interest Period" shall mean (i) as to any LIBOR Advance, the interest
period selected by the Company pursuant to Section 2.18(a), and (ii) as to any
Base Rate Advance, the interest period requested by the Company and agreed to by
the participating Lenders pursuant to Section 2.18(b), and (iii) as to any Swing
Rate Advance, the interest period requested by the Company and agreed to by
SunTrust pursuant to Section 2.03.
"Investment" shall mean, when used with respect to any Person, any
direct or indirect advance, loan or other extension of credit (other than the
creation of receivables in the ordinary course of business) or capital
contribution by such Person (by means of transfers of property to others or
payments for property or services for the account or use of others, or
otherwise) to any Person, or any direct or indirect purchase or other
acquisition by such Person of, or of a beneficial interest in, capital stock,
partnership interests, bonds, notes, debentures or other securities issued by
any other Person.
"Lenders" shall have the meaning set forth in the first paragraph of
this Agreement.
"Lending Office" shall mean, for each Lender, the office such Lender
may designate in writing from time to time to the Company and the Agent with
respect to Base Rate Advances and LIBOR Advances.
11
"Letter of Credit Fee" shall have the meaning set forth in Section
2.16(d).
"Letter of Credit Obligations" shall mean, with respect to Letters of
Credit, as at any date of determination, the sum of (a) the maximum aggregate
amount which at such date of determination is available to be drawn by the
beneficiaries thereof (assuming the conditions for drawing thereunder have been
met) under all Letters of Credit then outstanding, plus (b) the aggregate amount
of all drawings under Letters of Credit honored by the Agent not theretofore
reimbursed by the Company.
"Letter of Credit Subcommitment" shall mean $2,000,000.
"Letters of Credit" shall mean the letters of credit issued pursuant to
Section 2.04 hereof by the Agent for the account of the Company pursuant to the
Letter of Credit Subcommitment of the Revolving Loan Commitments.
"LIBOR" shall mean, for any Interest Period, the offered rates for
deposits in U.S. dollars for a period comparable to the Interest Period
appearing on the Telerate Screen Page 3750, as of 11:00 a.m., London time, on
the day that is two London banking days prior to the Interest Period. If at
least two such rates appear on the Telerate Screen Page 3750, the rate for that
Interest Period will be the arithmetic mean of such rates, and in either case as
such rates may be adjusted for any applicable reserve requirements.
"LIBOR Advance" shall mean any advance made to the Company by the
Lenders at an interest rate equal to LIBOR plus the Applicable Margin for such
advance.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, assignment or charge of any kind or description and shall include, without
limitation, any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, any lease in the nature thereof including any
lease or similar arrangement with a public authority executed in connection with
the issuance of industrial development revenue bonds or pollution control
revenue bonds, and the filing of or agreement to give any financing statement
under the Uniform Commercial Code (or comparable law) of any jurisdiction naming
the owner of the asset to which such lien applies as a debtor (other than a
filing which does not evidence an outstanding secured obligation, or a
commitment to make advances or to incur any other obligation of any kind).
"Loan Documents" shall mean this Agreement, each Exhibit and Schedule
to this Agreement, the Notes, the Guaranty Documents, the Security Documents,
the Letters of Credit, and each other document, instrument, certificate and
opinion executed and delivered in connection with the foregoing, each as
amended, restated, supplemented or otherwise modified from time to time as
provided in Section 10.02.
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"Maintenance Capital Expenditures" shall mean Capital Expenditures
other than Capital Expenditures made (i) in connection with any business
expansion of the Company or any of its Subsidiaries, (ii) in connection with any
Investment made by the Company after the Closing Date, or (iii) in connection
with any other acquisition or business expansion by the Company or any of its
Subsidiaries.
"Margin Regulations" shall mean Regulation T, Regulation U and
Regulation X of the Board of Governors of the Federal Reserve System, as the
same may be in effect from time to time.
"Material Contract" shall mean any contract or other agreement, written
or oral, of the Company or its Subsidiaries the failure to comply with which
could reasonably be expected to have a Materially Adverse Effect.
"Materially Adverse Effect" shall mean a materially adverse change in
the operations, business, property or assets of, or in the condition (financial
or otherwise) of, the Company and its Subsidiaries, taken as a whole.
"Maximum Permissible Rate" shall mean, with respect to interest payable
on any amount, the rate of interest on such amount that, if exceeded, could,
under Applicable Law, result in (i) civil or criminal penalties being imposed on
any Lender or (ii) any Lender being unable to enforce payment of (or if
collected, to retain) all or part of such amount or the interest payable
thereon.
"Minimum Net Worth" shall have the meaning set forth in Section 7.04
hereof.
"Mortgaged Property" shall mean, collectively, all parcels of real
property owned or leased by the Company or any of its Subsidiaries which is
subject to a Mortgage or which is assigned under an Assignment of Leases.
"Mortgages" shall mean, collectively, all of the mortgages, deeds of
trust or deeds to secure debt hereafter executed in favor of the Agent by the
Company or any Subsidiary, as the same may be hereafter amended, restated,
renewed, extended, supplemented or otherwise modified from time to time.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA as to which the Company, any Subsidiary or any ERISA
Affiliate is obligated to make, has made, or will be obligated to make
contributions on behalf of participants who are or were employed by any of them.
"Net Worth" shall mean, at any date, the net worth of the Consolidated
Companies, determined in accordance with GAAP as determined on such date.
"Notes" shall mean, collectively, the Revolving Notes and the Swing
Line Note.
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"Notice of Borrowing" shall have the meaning set forth in Section
2.02(a) hereof.
"Notice of Interest Rate Conversion" shall have the meaning set forth
in Section 2.02(b) hereof.
"Obligations" shall mean all amounts owing to the Agent or any Lender
pursuant to the terms of this Agreement or any other Loan Document, including
without limitation, all Advances (including all principal and interest payments
due thereunder), Letter of Credit Obligations, Fees, expenses, indemnification
and reimbursement payments, indebtedness, liabilities, and obligations of the
Company and its Subsidiaries, covenants and duties of the Company to the Lenders
and the Agent of every kind, nature and description, direct or indirect,
absolute or contingent, due or not due, in contract or tort, liquidated or
unliquidated, arising under this Agreement or under the other Loan Documents, by
operation of law or otherwise, now existing or hereafter arising or whether or
not for the payment of money or the performance or the nonperformance of any
act, including, but not limited to, all debts, liabilities and obligations owing
by the Company to others which the Lenders may have obtained by assignment or
otherwise, and all damages which the Company may owe to the Lenders and the
Agent by reason of any breach by the Company of any representation, warranty,
covenant, agreement or other provision of this Agreement or of any other Loan
Document.
"Other Claims" shall have the meaning set forth in Section 5.07 hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Person" shall mean an individual, corporation, partnership, trust,
limited liability company or unincorporated organization, a government or any
agency or political subdivision thereof.
"Plan" shall mean any employee benefit plan, program, arrangement,
practice or contract, maintained by or on behalf of the Company or an ERISA
Affiliate, which provides benefits or compensation to or on behalf of employees
or former employees, whether formal or informal, whether or not written,
including but not limited to the following types of plans:
(i) Executive Arrangements - any bonus, incentive
compensation, stock option, deferred compensation, commission,
severance, "golden parachute", "rabbi trust", or other executive
compensation plan, program, contract, arrangement or practice;
(ii) ERISA Plans - any "employee benefit plan" as defined in
ERISA, including, but not limited to, any defined benefit pension plan,
profit sharing plan, money purchase pension plan, savings or thrift
plan, stock bonus plan, employee
14
stock ownership plan, Multiemployer Plan, or any plan, fund, program,
arrangement or practice providing for medical (including
post-retirement medical), hospitalization, accident, sickness,
disability, or life insurance benefits;
(iii) Other Employee Fringe Benefits - any stock purchase,
vacation, scholarship, day care, prepaid legal services, severance pay
or other fringe benefit plan, program, arrangement, contract or
practice.
"Projected Gross Margin" shall mean Gross Margin calculated monthly,
projected by the Company and set forth on Annex A hereto.
"Pro Rata Share" shall mean, for any Lender, the proportion expressed
as a percentage equal to (1) the sum of such Lender's portion of the Total
Commitments (including, without duplication, any portion of the Total
Commitments in which such Lender has purchased a participation and excluding,
without duplication, any portion of the Total Commitments in which such Lender
has sold a participation), divided by (2) the sum of the Total Commitments.
"Regulation U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time, and any regulation
successor thereto.
"Required Lenders" shall mean Lenders whose combined Pro Rata Shares as
of the Closing Date of the Total Commitments are at least sixty-six and
two-thirds percent (66_%) of the Total Commitments.
"Revolving Loan Commitments" shall mean, for any Lender at any time,
the revolving credit facility severally established by such Lender in favor of
the Company pursuant to Section 2.01, as the same may be increased or decreased
from time to time as a result of any reduction thereof pursuant to Section 2.10,
any assignment thereof pursuant to Section 10.08, or any amendment thereof
pursuant to Section 10.02.
"Revolving Loans" shall mean, collectively, the loans made to the
Company by the Lenders pursuant to Section 2.01.
"Revolving Note" shall mean a promissory note of the Company payable to
the order of any Lender in substantially the form of Exhibit A hereto,
evidencing the maximum aggregate principal indebtedness of the Company to such
Lender under such Lender's Revolving Loan Commitment, either as originally
executed or as it may be from time to time supplemented, modified, amended,
renewed or extended.
"Security Documents" shall mean, collectively, the Mortgage, the
Assignment of Leases, the Company Pledge Agreement, the Company Security
Agreement, the Company Trademark Security Agreement, the Guarantor Pledge
Agreement, the
15
Guarantor Security Agreement, the Guarantor Trademark Security Agreement, all
UCC financing statements and fixture filings naming the Company or any of its
Subsidiaries as debtor and the Agent as secured party, all stock certificates
evidencing shares of stock pledged to the Agent, together with undated stock
powers or other appropriate instruments of transfer executed in blank, and all
filings in the U.S. Patent and Trademark Office which are required to be made
under the Loan Documents.
"Senior Debt Coverage Ratio" shall mean, for any fiscal period of the
Company, the ratio of (a) Senior Funded Debt as of the last day of such fiscal
period to (b) Annualized EBITDA.
"Senior Debt Leverage Ratio" shall mean, for any fiscal period of the
Company, the ratio of (a) Senior Funded Debt as of the last day of such fiscal
period to (b) Total Capitalization as of the last day of such fiscal period.
"Senior Funded Debt" shall mean all indebtedness for money borrowed,
purchase money mortgages, capitalized leases, outstandings under asset
securitization vehicles, conditional sales contracts and similar title retention
debt instruments, including any current maturities of such indebtedness, which
by its terms matures more than one year from the date of any calculation thereof
and/or which is renewable or extendable at the option of the obligor to a date
beyond one year from such date.
"Senior Subordinated Debt" shall mean the senior Subordinated Debt in
respect of the 12% Senior Subordinated Notes issued pursuant to the Senior
Subordinated Note Purchase Agreement.
"Senior Subordinated Note Purchase Agreement" shall mean that certain
Senior Subordinated Note Purchase Agreement, dated as of October 31, 1997,
between the Company and the Guarantors and the Investors listed therein, as
amended by Amendment No. 1 to Senior Subordinated Note Purchase Agreement dated
as of November 14, 1997, as further amended by Amendment No. 2 to Senior
Subordinated Note Purchase Agreement, dated as of June 30, 1998, and as further
amended by the Third Amendment to Senior Subordinated Debt, and as hereafter
amended and in effect from time to time (subject, in the case of any amendment
or modification entered into after the date hereof, to the consent of the
Required Lenders to the extent required by Section 6.14).
"Subordinated Debt" shall mean all Indebtedness of the Company
subordinated to all obligations of the Company arising under this Agreement, the
Notes and the Letter of Credit Obligations, on terms and conditions satisfactory
in all material respects to the Agent and the Required Lenders, including
without limitation, with respect to interest rates, payment terms, maturities,
amortization schedules, covenants, defaults, remedies, and subordination
provisions, as evidenced by the written approval of the Agent and Required
Lenders.
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"Subsidiary" of any Person shall mean any corporation, partnership or
other Person of which a majority of all the outstanding capital stock (including
director's qualifying shares) or other securities or ownership interests having
ordinary voting power to elect a majority of the board of directors or other
persons performing similar functions is, at the time as of which any such
determination is being made, directly or indirectly owned by such Person, or by
one or more of the Subsidiaries of such Person, and which corporation,
partnership or other Person is consolidated with such Person for financial
reporting purposes. Unless otherwise specified, "Subsidiaries" and "Subsidiary"
shall mean the Subsidiaries and a Subsidiary, respectively, of the Company.
"Supplemental Documents" shall mean the supplements to the following
documents: the Guaranty Agreement, the Contribution Agreement, the Guarantor
Security Agreement, the Guarantor Pledge Agreement and the Guarantor Trademark
Security Agreement, as such supplements are more specifically described and
shown in each respective document.
"Swing Line" shall have the meaning assigned to such term in Section
2.03(a).
"Swing Line Advance" shall mean a Borrowing pursuant to Section 2.03
consisting of a Swing Line Loan made by SunTrust to the Company on the same date
and interest rate basis.
"Swing Line Borrowing" shall mean a Borrowing consisting or to consist
of a Swing Line Advance.
"Swing Line Borrowing Notice" shall mean the notice given by the
Company to SunTrust requesting a Swing Line Advance as provided in Section
2.03(b).
"Swing Line Loans" shall mean, collectively, the loans made to the
Company by SunTrust pursuant to Section 2.03.
"Swing Line Note" shall mean the promissory note evidencing the Swing
Line Loans substantially in the form of Exhibit B and duly completed in
accordance with the terms hereof.
"Swing Line Subcommitment" shall mean the commitment of SunTrust to
make Swing Line Loans in an aggregate principal amount at any time outstanding
not to exceed $2,000,000.
"Swing Rate" shall have the meaning set forth in Section 2.17(c).
"Swing Rate Advance" shall mean an Advance made or outstanding as a
Swing Line Loan bearing interest based on the Swing Rate as provided in Section
2.17(c).
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"Swing Rate Quote" shall mean an offer by SunTrust to make a Swing Line
Loan to the Company at the Swing Rate specified therein for the interest period
to be applicable to the Swing Line Loan as specified therein, pursuant to
Section 2.03(b).
"Tax" shall mean, with respect to any person or entity, any federal,
state or foreign tax, assessment, customs duties, or other governmental charge,
levy or assessment (including any withholding tax) upon such person or entity or
upon such person's or entity's assets, revenues, income or profits, other than
income and franchise taxes imposed upon any Lender by the jurisdictions (or any
political subdivision thereof) in which such Lender has its principal office or
office from which its Advances are made, or in which such Lender is
incorporated.
"Third Amendment to Senior Subordinated Debt" shall mean that certain
Amendment No. 3 to Senior Subordinated Note Purchase Agreement, dated as of May
4, 1999, among the Company, the Guarantors and the Investors listed therein.
"Total Capitalization" shall mean the sum of shareholders' equity plus
Subordinated Debt plus Senior Funded Debt.
"Total Commitments" shall mean, at any time, the sum of the Revolving
Loan Commitments, including the Letter of Credit Subcommitment of each of the
Lenders, and in the case of SunTrust, the Swing Line Subcommitment.
"Total Revenues" shall mean, for any fiscal period of the Company, the
total revenues of the Company as determined on a consolidated basis in
accordance with GAAP.
"Underwriting Fee" shall mean the underwriting fee described in the Fee
Letter, payable on the Closing Date to SunTrust Equitable Securities
Corporation.
"United States" or "U.S." means the United States of America, its fifty
(50) States and the District of Columbia.
"U.S. Dollar" "Dollar" and "$" shall mean lawful money of the United
States of America.
"Year 2000 Compliant" shall have the meaning set forth in Section 4.23.
SECTION 1.02 Calculations; Accounting Terms. Calculations of all
financial data herein shall be on a consolidated basis for the Company and all
Subsidiaries; and all accounting terms used herein shall, unless otherwise
expressly indicated, be in reference to the Company and its Subsidiaries, if
any, on a consolidated basis, which may be accounted for in accordance with the
equity investment method (to the extent such method is in accordance with GAAP),
and shall have the meanings ascribed thereto under and be interpreted in
18
accordance with GAAP. All calculations and determinations under Article VII
shall be made in accordance with accounting principles consistent with those
followed in the preparation of the annual or interim financial statements, as
applicable, referred to in Section 5.02.
SECTION 1.03 Other Definitional Provisions.
(a) Except as otherwise specified herein, all references herein (A) to
any Person, other than the Company or any Subsidiary, shall be deemed to include
such Person's successors, transferees and assignees, (B) to the Company or any
Subsidiary, shall be deemed to include such Person's successors, (C) to any
Applicable Law specifically defined or referred to herein shall be deemed
references to such Applicable Law as the same may be amended or supplemented
from time to time, and (D) to any contract defined or referred to herein shall
be deemed references to such contract (and, in the case of any instrument, any
other instrument issued in substitution therefor) as the terms thereof may have
been or may be amended, supplemented, waived or otherwise modified from time to
time.
(b) When used in this Agreement, the words "herein", "hereof" and
"hereunder" and words of similar import shall refer to this Agreement as a whole
and not to any provision of this Agreement, and "Section", "Subsection",
"Schedule" and "Exhibit" shall refer to Sections and Subsections of, and
Schedules and Exhibits to, this Agreement unless otherwise specified.
(c) Whenever the context so requires, the neuter gender includes the
masculine or feminine, and the singular number includes the plural, and vice
versa.
(d) All terms defined in this Agreement shall have the defined meanings
when used in any Note or, except as otherwise expressly stated therein, any
certificate, opinion or other Loan Document.
SECTION 1.04 Captions. Article and Section captions in this Agreement
are included for convenience of reference only and shall not constitute a part
of this Agreement for any other purpose.
ARTICLE II
AMOUNT AND TERMS OF LOANS
SECTION 2.01 Revolving Loan Commitments and Revolving Notes. Subject to
and upon the terms and conditions set forth in this Agreement, (i) each of the
Lenders severally establishes until May 4, 2002, unless otherwise extended
pursuant to Section 2.19 below (May 4, 2002, or such later date as the
Commitments have been extended pursuant to Section 2.19, is hereinafter referred
to as the "Commitment Termination Date") a revolving credit facility in favor of
the Company in aggregate principal at any one time outstanding not to
19
exceed the sum set forth opposite such Lender's name below, as the same may be
reduced from time to time pursuant to the terms hereof:
SunTrust Bank, South Florida, $42,500,000.00 56.67%
National Association
Bank Austria Creditanstalt $15,000,000.00 20.00%
Corporate Finance, Inc.
The Provident Bank $10,000,000.00 13.33%
Bank Leumi Le-Israel B.M. $7,500,000.00 10.00%
TOTAL: $75,000,000.00 100.00%
and (ii) each Lender agrees to purchase a participation interest in the Letters
of Credit in accordance with this Article II; provided, however, that in no
event may the aggregate principal amount of all outstanding Revolving Loans,
Swing Line Loans and Letter of Credit Obligations outstanding exceed at any time
the Total Commitments from time to time in effect. Within the limits of the
Revolving Loan Commitments, the Company may borrow, repay and reborrow under the
terms of this Agreement; provided, however, that (A) the aggregate principal
amount of each Borrowing shall not be less than $500,000 and shall be in
integral multiples of $100,000, (B) all of the Company's representations and
warranties are true and correct on and as of the date of each Borrowing, (C) the
Company may neither borrow nor reborrow should there exist a Default or an Event
of Default, or such would result from the Borrowing, (D) the aggregate
outstanding amount of Advances and Letter of Credit Obligations, after giving
effect to each Borrowing and issuance of Letters of Credit, shall not exceed the
Total Commitments, and (E) the aggregate outstanding amount of Advances and
Letter of Credit Obligations, after giving effect to each Borrowing and issuance
of Letters of Credit, shall not exceed the aggregate amount of the Borrowing
Base. At no time shall the number of Borrowings outstanding under this Article
II exceed six; provided that, for the purpose of determining the number of
Borrowings outstanding, all Borrowings consisting of Base Rate Advances shall be
considered as one Borrowing. Borrowings under the Commitments shall be made
through simultaneous Advances by the Lenders, and the amount of each such
Borrowing shall be prorated among such Lenders based on the percentages set
forth above. All Advances by each Lender shall be evidenced by a single
Revolving Note payable to such Lender in the form of Exhibit A attached hereto
with appropriate insertions. Each Revolving Note shall be dated the date hereof,
shall be payable to the order of the respective Lender in a principal amount
equal to the amount set forth opposite such Lender's name above, shall bear
interest as provided for in this Agreement and shall mature on the Commitment
Termination Date or sooner should the principal and accrued interest thereon be
declared immediately due and payable as provided for herein. No Lender shall
have any obligation to advance funds in excess of an amount equal to the
percentage set forth opposite such Lender's name above multiplied by the Total
Commitments.
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SECTION 2.02 Method of Borrowing Under the Commitments.
(a) The Company shall give the Agent written or telephonic notice
(promptly confirmed in writing) of any requested Borrowing under the
Commitments, substantially in the form of Exhibit C attached hereto (a "Notice
of Borrowing"), specifying (i) the amount of the Borrowing, and (ii) the date
the proposed Borrowing is to be made (which shall be a Business Day). Each
Notice of Borrowing shall be given to the Agent (x) in the case of Base Rate
Advances, not later than 11:00 a.m. (Ft. Lauderdale, Florida time) the same
Business Day of such requested Borrowing or (y) in the case of LIBOR Advances,
at least three Business Days before the date such requested Borrowing is to be
made (which shall be a Business Day). The Agent shall be entitled to rely on any
telephonic Notice of Borrowing which it believes in good faith to have been
given by an Executive Officer of the Company, and any Advances made by the
Lenders based on such telephonic notice shall, when deposited by the Agent to
the Company's Account No. 0128320009032 at SunTrust, be Advances for all
purposes hereunder.
(b) Whenever the Company desires to convert all or a portion of an
outstanding Borrowing consisting of Base Rate Advances into one or more
Borrowings consisting of LIBOR Advances, or to continue a Borrowing consisting
of LIBOR Advances for a new Interest Period, it shall give the Agent written
notice or telephonic notice (promptly confirmed in writing) at least three
Business Days before the date of such conversion, specifying each such Borrowing
to be converted into or continued as LIBOR Advances. Such notice (a "Notice of
Interest Rate Conversion") shall be given prior to 11:00 a.m. (Ft. Lauderdale,
Florida time) on the date specified. Each such Notice of Interest Rate
Conversion shall be irrevocable and shall specify the aggregate principal amount
of the Advances to be converted or continued, the date of such conversion or
continuation and the Interest Period applicable thereto. If, upon the expiration
of any Interest Period in respect of any Borrowing, the Company shall have
failed to deliver the Notice of Interest Rate Conversion, the Company shall be
deemed to have elected to convert or continue such Borrowing to a Borrowing
consisting of Base Rate Advances. So long as any Default or Event of Default
shall have occurred and be continuing, no Borrowing may be converted into or
continued as (upon expiration of the current Interest Period) LIBOR Advances
unless the Agent and each of the Lenders shall have otherwise consented in
writing. No conversion of any Borrowing of LIBOR Advances shall be permitted
except on the last day of the Interest Period in respect thereof.
(c) Upon receipt of a Notice of Borrowing or a Notice of Interest Rate
Conversion from the Company, the Agent shall notify the Lenders by telephone,
which notice shall be promptly confirmed in writing (including by telecopier) by
the Agent to such Lenders, of such Notice of Borrowing or Notice of Interest
Rate Conversion and of each such Lender's Pro Rata Share of the requested
Borrowing or Interest Rate Conversion. Not later than 1:00 p.m. (Ft. Lauderdale,
Florida time) on the date specified for the Borrowing or Interest Rate
Conversion in the Notice of Borrowing or Notice of Interest Rate Conversion and
in the notice to such Lender provided by the Agent, each Lender shall promptly
make its portion of the Borrowing available to the Agent in immediately
available funds, and the Agent shall make available to the Company the amount so
received by the Agent from the Lenders not later than 3:00 p.m. (Ft. Lauderdale,
21
Florida time) on such date. In the event any Lender shall fail to make any
Advance available to the Agent in immediately available funds by 1:00 p.m. (Ft.
Lauderdale, Florida time) on the date specified, and provided no Default or
Event of Default shall have occurred and be continuing, the Agent may advance
such Lender's portion of the Borrowing on behalf of such Lender, in which event
such Lender shall promptly reimburse the Agent for the amount thereof plus (i)
if the amount of such Lender's Advance is reimbursed to the Agent on or prior to
the calendar day next succeeding the date of the Borrowing, interest on such
amount at the rate equal to the Federal Funds Rate, or (ii) if the amount of
such Lender's Advance is reimbursed to the Agent after the calendar day next
succeeding the day of the Borrowing, interest on such amount at the Base Rate;
provided, however, that any such reimbursement by the Company to the Agent shall
not relieve such Lender who fails to make any Advance as provided above from
liability to the Company for such failure. The amount of interest payable as a
result of any Lender's failure to make any Advance available shall be calculated
on the basis of a year of 360 days and paid for the actual number of days such
failure has continued (including the date of payment). If the Company fails to
reimburse the Agent as provided in this Section 2.02(c), then the Agent shall
have the right to deduct any amounts owed to it hereunder from Advances it makes
to the Company in subsequent Borrowings made by the Company.
SECTION 2.03 Swing Line Subcommitment.
(a) Notwithstanding anything contained herein to the contrary, SunTrust
hereby establishes a subcommitment within its Revolving Loan Commitment of up to
an aggregate of $2,000,000 (the "Swing Line") to accommodate the short term
borrowing needs of the Company. Sections 3.01 and 3.02 shall apply equally to
Borrowings made through the Swing Line and Borrowings or Interest Rate
Conversions requested or made through Section 2.02. The aggregate amount of all
Borrowings under the Swing Line shall not at any time exceed the Swing Line
Subcommitment, and to the extent any Borrowing under the Swing Line would cause
such a result after giving effect thereto, the Company shall be required to
request such Borrowing under Section 2.02(a) hereof. Any Borrowing made by the
Company under the Swing Line shall be for a period not to exceed 30 days.
(b) Whenever the Company desires to make a Borrowing under the Swing
Line, it shall give SunTrust prior written or telephonic notice (promptly
confirmed in writing) of any requested Borrowing under the Swing Line (each a
"Swing Line Borrowing Notice") prior to 11:00 a.m. (Ft. Lauderdale, Florida
time) on the date of such Borrowing. Each Swing Line Borrowing Notice shall
specify the aggregate principal amount of the Swing Line Borrowing, the date of
such Swing Line Borrowing (which shall be a Business Day) and the interest
period to be applicable thereto. SunTrust shall make available to the Company
the amount of the Borrowing requested in the Swing Line Borrowing Notice not
later than 3:00 p.m. (Ft. Lauderdale, Florida time) on such date, provided that
(i) no Default or Event of Default shall have occurred and be continuing and
(ii) the aggregated principle amount of the Swing Line Borrowings, including the
requested Borrowing under such Swing Line Borrowing Notice, shall be no greater
than the Swing Line Subcommitment.
22
(c) The Company's obligation to pay the principal of, and interest on,
the Swing Line Loans shall be evidenced by the records of SunTrust and by the
Swing Line Note payable to SunTrust (or its assignee) completed in conformity
with this Agreement.
(d) The outstanding principal amount under each Swing Line Loan shall
be due and payable in full on the Commitment Termination Date.
(e) Each Borrowing under the Swing Line shall deemed to be made under
SunTrust's Commitment to the extent of any Availability thereunder on the date
such Borrowing is made.
SECTION 2.04 Letter of Credit Subcommitment. Subject to, and upon the
terms and conditions, hereof (including the limitations of Section 2.01) the
Company may request, in accordance with the provisions of this Section 2.04 and
Section 2.05, that on and after the Closing Date, the Agent issue a Letter or
Letters of Credit for the account of the Company; provided, that (i) no Letter
of Credit shall have an expiration date that is later than ten days prior to the
Commitment Termination Date; (ii) each Letter of Credit issued by the Agent
shall be in a stated amount of at least $250,000; (iii) the Agent shall have no
obligation to issue any Letter of Credit, if, after giving effect to such
issuance, the aggregate Letter of Credit Obligations would exceed the Letter of
Credit Subcommitment; and (iv) the Agent shall have no obligation to issue any
Letter of Credit, if, after giving effect to such issuance, the sum of the
outstanding Revolving Loans, Swing Line Loans and Letter of Credit Obligations
would exceed the Total Commitments or the Borrowing Base.
SECTION 2.05 Notice of Issuance of Letter of Credit; Agreement to Issue.
(a) Whenever the Company desires the issuance of a Letter of Credit, it
shall, in addition to any application and documentation procedures required by
the Agent for the issuance of such Letter of Credit, deliver to the Agent a
written notice no later than 11:00 A.M. (Atlanta, Georgia time) at least ten
(10) days in advance of the proposed date of issuance. Each such notice shall
specify (i) the proposed date of issuance (which shall be a Business Day); (ii)
the face amount of the Letter of Credit; (iii) the expiration date of the Letter
of Credit; and (iv) the name and address of the beneficiary with respect to such
Letter of Credit and shall attach a precise description of the documentation and
a verbatim text of any certificate to be presented by the beneficiary of such
Letter of Credit which would require the Agent to make payment under the Letter
of Credit, provided that the Agent may require changes in any such documents and
certificates in accordance with its customary letter of credit practices, and
provided further, that no Letter of Credit shall require payment against a
conforming draft to be made thereunder on the same Business Day that such draft
is presented if such presentation is made after 11:00 A.M. (Fort Lauderdale,
Florida time). In determining whether to pay under any Letter of Credit, the
Agent shall be responsible only to determine that the documents and certificate
required to be delivered under its Letter of Credit have been delivered, and
that they comply on their face with the requirements of the Letter of Credit.
Promptly after receiving the notice of issuance of a Letter of Credit, the Agent
shall notify each Lender of such Lender's respective participation therein,
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determined in accordance with its respective Pro Rata Share of the Revolving
Loan Commitments as determined on the date of the issuance of such Letter of
Credit.
(b) The Agent agrees, subject to the terms and conditions set forth in
this Agreement, to issue for the account of the Company, a Letter of Credit in a
face amount equal to the face amount requested under paragraph (a) above,
following its receipt of a notice and the application and other documents
required by Section 2.05(a). Immediately upon the issuance of each Letter of
Credit, each Lender shall be deemed to, and hereby agrees to, have irrevocably
purchased from the Agent a participation in such Letter of Credit and any
drawing thereunder in an amount equal to such Lender's Pro Rata Share multiplied
by the face amount of such Letter of Credit.
SECTION 2.06 Payment of Amounts drawn under Letter of Credit.
(a) In the event of any request for a drawing under any Letter of
Credit by the beneficiary thereof, the Agent shall notify the Company and the
Lenders on or before the date on which the Agent intends to honor such drawing,
and the Company shall reimburse the Agent on the day on which such drawing is
honored in an amount, in same day funds, equal to the amount of such drawing,
provided that anything contained in this Agreement to the contrary
notwithstanding, unless the Company shall have notified the Agent prior to 11:00
A.M. (Fort Lauderdale, Florida time) on the Business Day immediately prior to
the date on which such drawing is honored, that the Company intends to reimburse
the Agent for the amount of such drawing in funds other than the proceeds of
Revolving Loans, the Company shall be deemed to have timely given a Notice of
Borrowing to the Agent requesting Revolving Loans which are Base Rate Advances
on the date on which such drawing is honored in an amount equal to the amount of
such drawing, and the Lenders shall by 1:00 P.M. (Fort Lauderdale, Florida time)
on the date of such drawing, make Revolving Loans which are Base Rate Advances
in the amount of such drawing, the proceeds of which shall be applied directly
by the Agent to reimburse the Agent for the amount of such drawing, provided
that for the purposes solely of such Borrowing, the conditions and precedents
set forth in Sections 3.01 and 3.02 hereof shall not be applicable, and provided
further that if for any reason proceeds of the Revolving Loans are not received
by the Agent on such date in the amount equal to the amount of such drawing, the
Company shall reimburse the Agent on the Business Day immediately following the
date of such drawing in an amount, in dollars and immediately available funds,
equal to the excess of the amount of such drawing over the amount of such
Revolving Loans, if any, which are so received, plus accrued interest on the
amount at the applicable rate of interest for Base Rate Advances.
(b) Notwithstanding any provision of this Agreement to the contrary, to
the extent that any Letter of Credit or portion thereof remains outstanding on
the Commitment Termination Date, the parties hereby agree that the beneficiary
or beneficiaries thereof shall be deemed to have made a drawing of all available
amounts pursuant to such Letters of Credit on the Commitment Termination Date,
which amounts shall be reimbursed to the Agent as set forth above.
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SECTION 2.07 Payment by Lenders. In the event that the Company shall
fail to reimburse the Agent as provided in Section 2.06 by borrowing Revolving
Loans, or otherwise providing an amount equal to the amount of any drawing
honored by the Agent pursuant to any Letter of Credit issued by it, the Agent
shall promptly notify each Lender of the unreimbursed amount of such drawing and
of such Lender's respective participation therein. Each Lender shall make
available to the Agent an amount equal to its respective participation, in
dollars and in immediately available funds, at the office of the Agent specified
in such notice not later than 1:00 P.M. (Fort Lauderdale, Florida time) on the
Business Day after the date notified by the Agent. In the event that any such
Lender fails to make available to the Agent the amount of such Lender's
participation in such Letter of Credit, the Agent shall be entitled to recover
such amount on demand from such Lender together with interest on such amount at
the Base Rate. The Agent shall distribute to each other Lender which has paid
all amounts payable under this Section with respect to any Letter of Credit,
such Lender's Pro Rata Share of all payments received by the Agent from the
Company in reimbursement of drawings honored by the Agent under such Letter of
Credit when such payments are received.
SECTION 2.08 Obligations Absolute. The obligation of the Company to
reimburse the Agent for drawings made under Letters of Credit issued for the
account of the Company and the Lenders' obligation to honor their participations
purchased therein shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including without limitation, the following circumstances:
(a) Any lack of validity or enforceability of any Letter of Credit;
(b) The existence of any claim, set-off, defense or other right which
the Company or any Subsidiary or Affiliate of the Company may have at any time
against a beneficiary or any transferee of any Letter of Credit (or any Persons
or entities for whom any such beneficiary or transferee may be acting), any
Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including without
limitation any underlying transaction between the Company or any of its
Subsidiaries and Affiliates and the beneficiary for which such Letter of Credit
was procured); provided that nothing in this Section shall affect the right of
the Company to seek relief against any beneficiary, transferee, Lender or any
other Person in any action or proceeding or to bring a counterclaim in any suit
involving such Persons;
(c) Any draft, demand, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect;
(d) Payment by the Agent under any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit;
25
(e) Any other circumstance or happening whatsoever which is similar to
any of the foregoing; or
(f) the fact that a Default or an Event of Default shall have occurred
and be continuing.
SECTION 2.09 Indemnification; Nature of Agent's Duties.
(a) In addition to amounts payable elsewhere provided in this
Agreement, without duplication, the Company hereby agrees to protect, indemnify,
pay and save the Agent and each Lender harmless from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and reasonable
expenses (including reasonable attorney's fees and disbursements) which the
Agent or any Lender may incur or be subject to as a consequence, direct or
indirect, of (i) the issuance of any Letter of Credit for the account of the
Company, other than as a result of the gross negligence or willful misconduct of
the Agent; or (ii) the failure of the Agent to honor a drawing under any Letter
of Credit due to any act or omission (whether rightful or wrongful) of any
present or future de jure or de facto government or governmental authority.
(b) Notwithstanding any other provision contained in this Agreement,
the Agent shall not be obligated to issue any Letter of Credit, nor shall any
Lender be obligated to purchase its participation in any Letter of Credit to be
issued hereunder, if the issuance of such Letter of Credit or purchase of such
participation shall have become unlawful or prohibited by compliance by Agent or
such Lender in good faith with any law, governmental rule, guideline, request,
order, injunction, judgment or decree (whether or not having the force of law);
provided that in the case of the obligation of a Lender to purchase such
participation, such Lender shall have notified the Agent to such effect in
writing at least ten (10) Business Days' prior to the issuance thereof by the
Agent, which notice shall relieve the Agent of its obligation to issue such
Letter of Credit pursuant to Section 2.04 and Section 2.05 hereof.
SECTION 2.10 Prepayment of Borrowings Under the Commitments. The
Company shall have the right to prepay Borrowings under the Commitments, in
whole at any time or in part from time to time, without premium or penalty (but,
in the case of LIBOR Advances, subject to the funding indemnification provisions
of Section 2.22), provided that (i) the Company gives the Agent prior written
notice of such prepayment, specifying the date such prepayment will occur (which
shall be a Business Day), (x) in the case of any Base Rate Advance, at least one
Business Day in advance of such date or (y) in the case of any LIBOR Advance
during an Interest Period, at least three Business Days in advance of such date,
(ii) each partial prepayment shall be in an amount of at least $500,000 and
integral multiples of $100,000, (iii) prepayments shall be applied to repay
Borrowings under the Commitments in the order set forth in Section 2.13 hereof,
and (iv) such prepayments include interest accrued, on the principal amount
prepaid, to the prepayment date.
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SECTION 2.11 Mandatory Prepayments.
(a) If the sum of the (i) aggregate outstanding principal amount of the
Revolving Loans, (ii) aggregate outstanding principal amount of the Swing Line
Loans, and (iii) Letter of Credit Obligations exceed at any time the Total
Commitments, as reduced pursuant to Section 2.10 or otherwise, the Company shall
immediately repay the Revolving Loans, Swing Line Loans or Letter of Credit
Obligations by an amount equal to such excess. Each prepayment of Revolving
Loans shall be applied first to Base Rate Advances to the full extent thereof
before application to LIBOR Advances.
(b) The Company shall make a mandatory prepayment from 100 percent of
the after-tax net proceeds received by the Company from any sale or other
disposition by the Company of any of its assets, provided, however, that such
prepayment provision shall not apply to the sales of inventory by the Company in
the ordinary course of business or assets disposed of as part of the Company's
standard acquisition procedures (such assets to include high-pressure tanks,
motorized vehicles, including cars and trucks, and lines of business other than
carbon dioxide that may be obtained by the Company as part of the group of
assets of any corporation or other business entity the Company may acquire), and
certain other sales to be agreed upon in writing by the Company and the Required
Lenders.
(c) The Company shall make a mandatory prepayment from 100 percent of
net proceeds of any offering of debt; provided, however, that this provision
shall not include (i) fifty percent (50%) of the proceeds of the new
Subordinated Debt issued pursuant to the Third Amendment to Senior Subordinated
Debt, and (ii) any purchase money obligations paid to the Company.
(d) Notwithstanding anything in this Agreement to the contrary, no
reduction in the Commitments shall be required hereunder as a result of any
mandatory prepayment under this Section 2.11.
SECTION 2.12 Voluntary Reduction of Commitments. Upon at least five (5)
Business Days' prior written notice (or telephonic notice promptly confirmed in
writing) to the Agent, which notice shall specify (1) the amount by which such
Commitments are to be terminated and (2) the date such termination is to occur,
the Company shall have the right, without premium or penalty, to terminate the
Commitments, in whole or in part, provided that (a) any partial termination
pursuant to this Section 2.12 shall be in an amount of at least $5,000,000 and
integral multiples of $5,000,000 and (b) any such termination shall apply to
reduce proportionately and permanently the Commitments. If the aggregate
principal amount of Advances exceeds the amount of the Commitments as so
reduced, the Company shall immediately repay Borrowings under such Commitments
by an amount equal to such excess, together with accrued but unpaid interest on
such excess.
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SECTION 2.13 Allocation of Payments.
(a) All principal and interest payments and prepayments made with
respect to Advances and payments in respect of Commitment Fees shall be
allocated among all outstanding Commitments and Advances to which such payments
relate, proportionately based on the Lenders' Pro Rata Shares of the
Commitments.
(b) All payments made to the Agent by the Company shall be applied in
the following order: (a) first, to the reimbursement of any fees which are due
and payable, and expenses incurred by and then due and payable to, the Agent, in
accordance with the terms of this Agreement, in connection with the
administration of the Commitments and otherwise (to the extent any such fees are
payable by the Company pursuant to the terms of this Agreement); (b) second, to
the payment of any accrued and unpaid interest and Fees which are due and
payable, pro rata to the Lenders based upon their respective Pro Rata Shares of
the Commitments; and (c) finally, to the payment of outstanding Advances.
SECTION 2.14 Termination of Commitments. The unpaid principal balance
and all accrued and unpaid interest on the Notes will be due and payable upon
the first of the following dates or events to occur: (i) acceleration of the
maturity of any Note in accordance with the remedies contained in Section 8.02
of this Agreement; or (ii) upon the expiration of the Commitments on the
Commitment Termination Date.
SECTION 2.15 Use of Proceeds. The proceeds of each Borrowing under the
Commitments will be used by the Company solely to make Capital Expenditures and
to provide for the working capital and general corporate needs of the Company.
SECTION 2.16 Fees.
(a) On the Closing Date, the Company shall pay to SunTrust Equitable
Securities Corporation, the Underwriting Fee, which shall be fully earned and
nonrefundable when paid.
(b) On the Closing Date and on each anniversary thereof, if the
Commitments are extended pursuant to Section 2.19, the Company shall pay to the
Agent the Agent Fee, which fee shall be nonrefundable when paid.
(c) The Company shall pay to the Agent, for the account of and
distribution of the respective Pro Rata Share to each Lender (subject to the
last sentence hereof), a commitment fee (the "Commitment Fee") for the period
commencing on the Closing Date to and including the Commitment Termination Date,
computed at a rate equal to the Applicable Commitment Fee Percentage multiplied
by the average daily unused portion of the Commitments of the Lenders, such fee
being payable quarterly in arrears on the last day of each calendar quarter,
commencing on June 30, 1999, and on the Commitment Termination Date. The
Commitment Fee will be calculated on the basis of a 360-day year for the actual
number of days elapsed.
28
(d) The Company shall pay, quarterly in arrears on the last day of each
calendar quarter, commencing on June 30, 1999, and on the Commitment Termination
Date, (i) to the Agent, for the account of and distribution of the respective
Pro Rata Share to each Lender, a letter of credit fee equal to the Applicable
Margin for LIBOR Advances multiplied by the average daily aggregate Letter of
Credit Obligations, and (ii) to the Agent, for its own account, a letter of
credit fronting fee equal to one-quarter of one percent (0.25%) multiplied by
the stated face amount of such Letter of Credit (collectively, the "Letter of
Credit Fee").
(e) The Company hereby authorizes the Agent to withdraw an amount equal
to the fees which are due and payable under clauses (a), (b) or (c) above from
any of its accounts with the Agent if not paid on the due date for such fees.
The Agent shall give the Company notice of any such withdrawals, provided,
however, that failure by the Agent to give the Company notice shall not prevent
the Agent from making any such withdrawals under this Section.
SECTION 2.17 Interest.
(a) For Borrowings other than those made under the Swing Line, the
Company shall be entitled to select between the following two options to
establish the rate of interest at which the unpaid principal amount of the
Revolving Notes shall accrue:
(i) Base Rate Advances - interest shall accrue at the Base Rate
plus the Applicable Margin; or
(ii) LIBOR Advances - interest shall accrue at LIBOR plus the
Applicable Margin.
(b) Interest on the Revolving Notes for Borrowings other than those
made under the Swing Line shall be calculated on the basis of a 360-day year and
shall be payable to the Lenders as follows:
(i) Base Rate Advances -- on the last day of every quarter in
arrears; and
(ii) LIBOR Advances -- at the expiration of each Interest Period
and, with respect to advances made for an Interest Period longer than
three months, also on the last day of each three-month period prior to
the expiration of the Interest Period.
(c) For Borrowings made under the Swing Line, the rate of interest at
which the unpaid principal shall accrue on the Swing Line Note shall be equal to
the Base Rate on the applicable day of the Swing Line Borrowing Notice (the
"Swing Rate").
29
SECTION 2.18 Interest Periods.
(a) In connection with the making or continuation of, or conversion
into, each Borrowing of LIBOR Advances, the Company shall select an Interest
Period to be applicable to such LIBOR Advance, which Interest Period shall be
either a 1, 2, 3 or 6 month period.
(b) In connection with the making of each Base Rate Advance, the
Company and the Lenders shall agree on an Interest Period acceptable to both
sides.
(c) Notwithstanding paragraphs (a) or (b) above:
(i) The initial Interest Period for any Borrowing of LIBOR
Advances shall commence on the date of such Borrowing (including the
date of any conversion from a Borrowing consisting of Base Rate
Advances) and each Interest Period occurring thereafter in respect of a
continuation of such Borrowing shall commence on the day on which the
immediately preceding Interest Period expires;
(ii) If any Interest Period would otherwise expire on a day which
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period in
respect of LIBOR Advances would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further Business
Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;
(iii) Any Interest Period in respect of LIBOR Advances which begins
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period shall, subject to
part (iv) below, expire on the last Business Day of such calendar
month; and
(iv) No Interest Period with respect to the Advances shall extend
beyond the Commitment Termination Date.
SECTION 2.19 Extension of Commitments. No earlier than 120 days but no
later than 90 days prior to the then applicable Commitment Termination Date, the
Company may request that the Commitment Termination Date be extended by the
Lenders for an additional 364-day or longer period. The Lenders may agree or not
agree to such extension in the exercise of their sole discretion; provided,
however, that the Agent shall inform the Company no later than 60 days prior to
the then applicable Commitment Termination Date of the Lenders' decision as to
whether to extend the Commitment Termination Date. Notwithstanding anything
herein to the contrary, the Commitment Termination Date may only be extended, in
the aggregate, for up to an additional two-year period pursuant to this Section
2.19. If the Lenders agree, in their sole discretion, to extend the Commitment
Termination Date, then the applicable Commitment Termination Date shall
automatically be so extended upon written notice thereof being delivered by the
Lenders to the Company and completion by the Company and its Subsidiaries of any
conditions to such extension required by the Lenders.
30
SECTION 2.20 Increased Costs.
(a) If, by reason of (x) after the date hereof, the introduction of or
any change (including, without limitation, any change by way of imposition or
increase of reserve requirements) in or in the interpretation of any law or
regulation, or (y) the compliance with any guideline or request from any central
bank or other governmental authority or quasi-governmental authority exercising
control over banks or financial institutions generally (whether or not having
the force of law):
(i) any Lender (or its applicable Lending Office) shall be subject
to any tax, duty or other charge with respect to its LIBOR Advances or
its obligation to make LIBOR Advances, or the basis of taxation of
payments to any Lender of the principal of or interest on its LIBOR
Advances or its obligation to make LIBOR Advances shall have changed
(except for changes in the tax on the overall net income of, or any
franchise tax on, such Lender or its applicable Lending Office imposed
by the jurisdiction in which such Lender's principal executive office
or applicable Lending Office is located); or
(ii) any reserve (including, without limitation, any imposed by the
Board of Governors of the Federal Reserve System), special deposit or
similar requirement against assets of, deposits with or for the account
of, or credit extended by, any Lender's applicable Lending Office shall
be imposed or deemed applicable or any other condition affecting its
LIBOR Advances or its obligation to make LIBOR Advances shall be
imposed on any Lender or its applicable Lending Office or the London
interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining LIBOR Advances (except to
the extent already included in the determination of LIBOR for LIBOR Advances),
or there shall be a reduction in the amount received or receivable by such
Lender or its applicable Lending Office, then the Company shall from time to
time, upon written notice from and demand by such Lender on the Company (with a
copy of such notice and demand to the Agent), pay to the Agent for the account
of such Lender within five Business Days after the date of such notice and
demand, additional amounts sufficient to indemnify such Lender against such
increased cost. A certificate as to the amount of such increased cost, submitted
to the Company and the Agent by such Lender in good faith and accompanied by a
statement prepared by such Lender describing in reasonable detail the basis for
and calculation of such increased cost, shall, except for manifest error, be
final, conclusive and binding for all purposes. In the event that the Company
shall pay the increased costs accrued through the date of payment as required
under this Section 2.20(a), plus any funding losses as described in Section
2.22, then the Company shall have the right to convert the relevant LIBOR
Advance to a Base Rate Advance, as provided in Section 2.02, and the Agent and
each of the Lenders shall be deemed to have given their consent thereto, as
required thereunder.
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(b) If any Lender shall advise the Agent that at any time, because of
the circumstances described in clauses (x) or (y) in Subsection 2.20(a) or any
other circumstances beyond such Lender's reasonable control arising after the
date of this Agreement affecting such Lender or the London interbank market or
the United States secondary certificate of deposit market or such Lender's
position in such markets, LIBOR, as determined by the Agent, will not adequately
and fairly reflect the cost to such Lender of funding its LIBOR Advances, then,
and in any such event:
(i) the Agent shall forthwith give notice (by telephone confirmed
in writing) to the Company and to the other Lenders of such advice;
(ii) the Company's right to request and such Lender's obligation to
make or permit portions of the Loans to remain outstanding past the
last day of the then current Interest Periods as LIBOR Advances shall
be immediately suspended; and
(iii) such Lender shall make a Loan as part of the requested
Borrowing of LIBOR Advances, as the case may be, as a Base Rate
Advance, which such Base Rate Advance shall, for all other purposes, be
considered part of such Borrowing.
SECTION 2.21 Capital Adequacy. If, after the date of this Agreement,
any Lender shall have determined that the adoption of any applicable law, rule
or regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Lender with any request or
directive regarding capital adequacy not currently in effect or fully applicable
as of the Closing Date (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 capital as a consequence of its
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then, from time to time, promptly upon demand by
such Lender (with a copy to the Agent), the Company shall pay such Lender such
additional amount or amounts as will compensate such Lender for such reduction.
A certificate of any Lender claiming compensation under this Section 2.21 and
setting forth the additional amount or amounts to be paid to it hereunder shall
be conclusive absent manifest error. In determining any such amount, such Lender
may use any reasonable averaging and attribution methods. Each Lender will
promptly notify the Company of any such adoption, change or compliance of which
it has knowledge which will entitle such Lender to compensation pursuant to this
Section, but the failure to give such notice shall not affect such Lender's
right to such compensation provided such Lender gives such notice within 90 days
after an officer of such Lender having responsibility for the administration of
this Agreement shall have received actual notice of such adoption, change or
compliance.
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SECTION 2.22 Funding Losses. The Company shall compensate each Lender,
upon its written request to the Company (which request shall set forth the basis
for requesting such amounts in reasonable detail and which request shall be made
in good faith and, absent manifest error, shall be final, conclusive and binding
upon all of the parties hereto), for all losses, expenses and liabilities
(including, without limitation, any interest paid by such Lender to lenders of
funds borrowed by it to make or carry its LIBOR Advances, in either case to the
extent not recoverable by such Lender in connection with a re-employment of such
funds and including loss of anticipated profits, which the Lender may sustain):
(i) if for any reason (other than a default by such Lender) a borrowing of, or
conversion to or continuation of, LIBOR Advances to the Company does not occur
on the date specified therefor in a Notice of Borrowing or Notice of Interest
Rate Conversion (whether or not withdrawn), (ii) if any repayment (including
mandatory prepayments and any conversions) of any LIBOR Advances by the Company
occurs on a date which is not the last day of an Interest Period applicable
thereto, or (iii) if, for any reason, the Company defaults in its obligation to
repay its LIBOR Advances when required by the terms of this Agreement.
SECTION 2.23 Making of Payments.
(a) The Fees and all payments of principal of, or interest on, the
Notes, and payments in respect of the Letters of Credit, shall be made in
immediately available funds free and clear of any defenses, set-offs,
counterclaims or withholdings or deductions for taxes to the Agent at its
principal office in Ft. Lauderdale, Florida, for the accounts of the respective
Lenders. All such payments shall be made not later than 1:00 p.m. (Ft.
Lauderdale, Florida time) and funds received after that hour shall be deemed to
have been received by the Agent on the next following Business Day. Payments to
the Agent shall, as to the Company, constitute payment to the applicable Lenders
hereunder, other than Swing Line Loans.
(b) Subject to Subsection 2.18(c)(ii), whenever any payment to be made
hereunder or under any Revolving Note or the Swing Line Note shall be stated to
be due on a day which is not a Business Day, the due date thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest thereon shall be payable at the applicable rate during such
extension.
(c) On the Business Day that a payment is received or deemed to have
been received hereunder, the Agent shall remit in immediately available funds to
each Lender its share, based on the percentages set forth in Section 2.01, of
all payments received by the Agent on the Revolving Notes.
SECTION 2.24 Default Rate of Interest. Upon the occurrence and during
the continuance of an Event of Default set forth in Section 8.01, to the extent
permitted by law, all unpaid amounts hereunder shall, on such date and
thereafter, accrue at the then applicable interest rate plus an additional two
percent (2.0%) per annum until payment in full, provided, that, for any LIBOR
Advance, at the end of the applicable Interest Period, interest shall accrue at
33
the Base Rate plus two percent (2.0%) per annum. Interest accruing pursuant to
this Section 2.24 will be due and payable upon demand.
SECTION 2.25 Proration of Payments. If any Lender shall obtain any
payment or other recovery (whether voluntary, involuntary, through exercise of
any right of set-off or otherwise) after the occurrence and during the
continuance of an Event of Default on account of the principal of or interest on
any Revolving Note or any fees in respect of this Agreement in excess of its Pro
Rata Share of payments and other recoveries obtained by all the Lenders on
account of the principal of and interest on the Revolving Notes then held by
them or any fees due to them in respect of this Agreement, such Lender shall
notify the Agent thereof and forthwith purchase from the other Lenders such
participation in the Revolving Notes held by them or in such fees owed to them
as shall be necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; provided, however, that if
all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase from such Lender shall be
rescinded and the purchase price restored by each selling Lender to the extent
of such recovery, but without interest, unless the purchasing Lender is required
to pay interest on the amount so recovered, in which case each selling Lender
shall pay its Pro Rata Share of such interest. After the occurrence and during
the continuance of an Event of Default, disproportionate payments of interest
shall be shared by the purchase of separate participations in unpaid interest
obligations, disproportionate payments of fees shall be shared by the purchase
of separate participations in unpaid fee obligations, and disproportionate
payments of principal shall be shared by the purchase of separate participations
in unpaid principal obligations. The Company agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.25
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Company in the amount of such
participation. Each Lender shall give the Agent notice within five (5) days of
any payments or other recoveries described above which it obtains.
SECTION 2.26 Lenders' Obligations Several. The obligation of each
Lender to make any Advance is several, and not joint or joint and several, and
is not conditioned upon the performance by all other Lenders of their
obligations to make Advances.
SECTION 2.27 Calculation of Interest. Interest payable on the Notes,
including interest payable as provided in Section 2.24, shall be calculated on
the basis of a year of 360 days and paid for the actual number of days elapsed.
SECTION 2.28 Payments Free of Taxes.
(a) All payments made by the Company under this Agreement, the Notes
shall be made free and clear of, and without deduction for, any Tax. To the
extent that the Company is obligated by Applicable Law to make any deduction or
withholding on account of any Tax from any amount payable to any Lender under
this Agreement, the Notes, the Company shall (1) make such deduction or
withholding and pay the same to the relevant governmental authority and (2) pay
34
such additional amount to such Lender as is necessary to result in that Lender's
receiving a net after-tax (or after-assessment or after-charge) amount equal to
the amount to which such Lender would have been entitled under this Agreement,
the Notes absent such deduction or withholding.
(b) Each Lender that is organized under the laws of any jurisdiction
other than the United States of America or any State thereof (including the
District of Columbia) agrees to furnish to the Company and the Agent, on the
Closing Date and otherwise prior to the time it becomes a Lender hereunder, two
copies of either U.S. Internal Revenue Service Form 4224 or U.S. Internal
Revenue Service Form 1001 or any successor forms thereto (wherein such Lender
claims entitlement to complete exemption from or reduced rate of U.S. Federal
withholding tax on interest paid by the Company hereunder) and to provide to the
Company and the Agent a new Form 4224 or Form 1001 or any successor forms
thereto if any previously delivered form is found to be incomplete or incorrect
in any material respect or upon the obsolescence of any previously delivered
form.
SECTION 2.29 Interest Rate Not Ascertainable, etc. In the event that
the Agent, in the case of LIBOR, shall have determined (which determination
shall be made in good faith and, absent manifest error, shall be final,
conclusive and binding upon all parties) that on any date for determining LIBOR
for any Interest Period, by reason of any changes arising after the date of this
Agreement affecting the London interbank market or the Agent's position in such
market, adequate and fair means do not exist for ascertaining the applicable
interest rate on the basis provided for in the definition of LIBOR then, and in
any such event, the Agent shall forthwith give notice (by telephone confirmed in
writing) to the Company and to the Lenders of such determination and a summary
of the basis for such determination. Until the Agent notifies the Company that
the circumstances giving rise to the suspension described herein no longer
exist, the obligations of the Lenders to make or permit portions of the Advances
to remain outstanding past the last day of the then current Interest Periods as
LIBOR Advances shall be suspended, and such affected Advances shall bear the
same interest as Base Rate Advances.
SECTION 2.30 Illegality.
(a) In the event that any Lender shall have determined (which
determination shall be made in good faith and, absent manifest error, shall be
final, conclusive and binding upon all parties) at any time that the making or
continuance of any LIBOR Advance has become unlawful by compliance by such
Lender in good faith with any applicable law, governmental rule, regulation,
guideline or order (whether or not having the force of law and whether or not
failure to comply therewith would be unlawful), then, in any such event, the
Lender shall give prompt notice (by telephone confirmed in writing) to the
Company and to the Agent of such determination and a summary of the basis for
such determination (which notice the Agent shall promptly transmit to the other
Lenders).
(b) Upon the giving of the notice to the Company referred to in
subsection (a) above, (i) the Company's right to request and such Lender's
obligation to make LIBOR
35
Advances shall be immediately suspended, and such Lender shall make an Advance
as part of the requested Borrowing of LIBOR Advances as a Base Rate Advance, and
(ii) if the affected LIBOR Advance or Advances are then outstanding, the Company
shall immediately, or if permitted by applicable law, no later than the date
permitted thereby, upon at least one Business Day's written notice to the Agent
and the affected Lender, convert each such Advance into an Advance or Advances
to a Base Rate Advance with an Interest Period ending on the date on which the
Interest Period applicable to the affected LIBOR Advances expires, provided that
if more than one Lender is affected at any time, then all affected Lenders must
be treated the same pursuant to this Subsection 2.30(b).
ARTICLE III
CONDITIONS TO BORROWINGS
The obligation of each Lender to make an Advance to the Company and the
obligation of the Agent to issue Letters of Credit hereunder is subject to the
satisfaction of the following conditions:
SECTION 3.01 Conditions Precedent to Initial Advances. At the time of
the making by each Lender of its initial Advance hereunder, unless otherwise
waived or consented to by the Required Lenders,
(a) all obligations of the Company to the Agent or any Lender incurred
prior thereto (including, without limitation, the Company's obligation to
reimburse the fees and disbursements of counsel to the Agent and the Lenders in
accordance with this Agreement), together with the Fees, shall have been paid in
full;
(b) the Agent shall have received the following, each dated as of the
Closing Date, if applicable, in form and substance satisfactory to the Lenders
and (except for the Notes) in sufficient copies for each Lender:
(i) A duly executed original of this Agreement.
(ii) A duly completed and executed original of a Revolving Note
payable to the order of each Lender in the principal amount of such
Lender's Commitment.
(iii) A duly completed and executed original of the Swing Line Note
payable to the order of SunTrust in the principal amount of $2,000,000.
(iv) A duly executed original of the Guaranty Agreement and the
Contribution Agreement.
36
(v) A duly executed original of the amendments to the Company
Security Agreement and the Guarantor Security Agreement, together with
such UCC financing statements and UCC amendments recorded in such
jurisdictions as the Required Lenders deem necessary or desirable to
perfect the security interests granted thereunder and under the Company
Pledge Agreement, the Guarantor Pledge Agreement, the Company Trademark
Security Agreement, and the Guarantor Trademark Security Agreement.
(vi) Lien searches in all relevant jurisdictions listing all
effective financing statements which name the Company or any of its
Subsidiaries as debtor, together with copies of such other financing
statements (none of which shall cover the Collateral purported to be
covered by the Company Security Agreement, the Guarantor Security
Agreement, the Company Pledge Agreement, the Guarantor Pledge
Agreement, the Company Trademark Security Agreement or the Guarantor
Trademark Security Agreement), other than financing statements in favor
of the Agent.
(vii) A duly executed original of the amendment to Company Pledge
Agreement and the Guarantor Pledge Agreement, together with stock
certificates evidencing the shares of stock of all Subsidiaries of the
Company pledged to the Agent thereunder and an undated stock power for
each such stock certificate, executed in blank by the pledgor of such
stock.
(viii) A duly executed original of the amendments to Company
Trademark Security Agreement and the Guarantor Trademark Security
Agreement, together with such filings in the United States Patent and
Trademark Office as the Required Lenders deem necessary or desirable to
perfect the security interests granted under the Company Trademark
Security Agreement and the Guarantor Trademark Security Agreement.
(ix) Duly executed originals of any amendments to Mortgages and
Assignments of Leases to be recorded in the real estate records of the
jurisdiction in which the Mortgaged Property related thereto is
located, together with such fixture filings and amendments to existing
fixture filings recorded in such jurisdictions as the Required Lenders
deem necessary or desirable to perfect the security interests granted
thereunder, and endorsements to the existing title insurance policies
for such Mortgage or Assignment of Leases showing that the Agent has a
valid first priority Lien with respect to such Mortgaged Property
subject to no encumbrances other than such Mortgage or such Assignment
of Leases, and Liens permitted pursuant to Section 6.01 hereof.
(x) Evidence satisfactory to the Required Lenders that all other
actions necessary or desirable to perfect and protect the security
interests created by the Security Documents have been taken.
37
(xi) Certificates of insurance issued by the Company's insurers,
describing in reasonable detail the insurance maintained by the
Company, together with appropriate evidence showing that the Agent has
been named as loss payee or additional insured, as its interest may
appear, on all insurance policies insuring property of the Company and
its Subsidiaries.
(xii) Certificates signed by the Chief Executive Officer or the
Chief Financial Officer of each of the Company and the Guarantors as to
the solvency of such Company or Guarantor.
(xiii) A duly executed original of the Closing Certificate, in the
form attached hereto as Exhibit F.
(xiv) Copies of the organizational papers of each of the Company
and the Subsidiaries, certified as true and correct by the Secretary of
State of the State in which the Company or such Subsidiary is
incorporated, and certificates from the Secretaries of State of the
States in which the Company or such Subsidiary is incorporated and of
each state in which the Company or such Subsidiary is legally required
to qualify to transact business as a foreign corporation, certifying
the Company's or Subsidiaries' good standing as a corporation in such
States.
(xv) Copies of the bylaws of each of the Company and the
Guarantors of resolutions of the Board of Directors of each of the
Company and the Guarantors approving this Agreement, the Notes, the
Borrowings hereunder, the Security Documents and all other Loan
Documents to which the Company or such Guarantor is a party and of all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this Agreement, the Notes, the
Security Documents and all other Loan Documents to which the Company or
such Guarantor is a party, in each case certified as true and correct
by the Secretary or an Assistant Secretary of the Company or such
Guarantor.
(xvi) A favorable written opinion of Xxxxxx Xxxxxxxx Frome
Xxxxxxxxxx & Wolosky LLP, General Counsel for the Company and the
Guarantors, substantially in the form of Exhibit G attached hereto, and
covering such additional matters relating to the transactions
contemplated hereby as the Required Lenders may reasonably request,
addressed to the Agent and the Lenders.
(xvii) A favorable written opinion of Holland & Knight LLP, counsel
for the Company and the Guarantors, substantially in the form of
Exhibit H attached hereto, and covering such additional matters
relating to the transactions contemplated hereby as the Required
Lenders may reasonably request, addressed to the Agent and the Lenders.
(xviii) Certified copies of all consents, approvals, authorizations,
registrations or filings required to be made or obtained by the Company
or the Guarantors
38
in connection with the transactions contemplated hereby and by the
other Loan Documents.
(c) Since December 31, 1998, there shall have been no change which has
had or could reasonably be expected to have a Materially Adverse Effect;
(d) Issuance and funding of at least $10,000,000 in additional
Subordinated Debt pursuant to the Third Amendment to Senior Subordinated Debt,
in form and substance satisfactory to the Lenders;
(e) Receipt by the Agent of the interest rate protection agreement
required by Section 5.15, in form and substance satisfactory to Agent; and
(f) All corporate and other proceedings taken or to be taken in
connection with the transactions contemplated hereby and all Loan Documents and
other documents incident thereto or delivered in connection therewith shall be
satisfactory in form and substance to each Lender.
SECTION 3.02 Conditions Precedent to Each Advance and Letters of
Credit. At the time of the making by the Lenders of each Advance hereunder
(including the initial Advances) and the issuance of all Letters of Credit
(before as well as after giving effect to such Advances and the proposed use of
the proceeds thereof and the issuance of Letters of Credit), the following
statements shall be true:
(a) The representations and warranties contained in Article IV hereof
are true and correct in all material respects on and as of the date of such
Borrowing or the issuance of such Letters of Credit as though made on and as of
such date, except insofar as such representations and warranties speak only as
of a prior date or reflect transactions and events after the Closing Date, as
permitted by the Loan Documents;
(b) No Default or Event of Default exists or would result from such
Borrowing or from the application of the proceeds therefrom;
(c) Since the date of the most recent consolidated financial statements
of the Company described in Section 4.14 or delivered to the Lenders pursuant to
Section 5.02, there shall have been no change which has had or could reasonably
be expected to have a Materially Adverse Effect;
(d) There shall be no action or proceeding instituted or pending before
any court or other governmental authority or, to the knowledge of the Company,
threatened (i) which reasonably could be expected to have a Materially Adverse
Effect, or (ii) seeking to prohibit or restrict the ownership or operation of
any portion of the business or assets of the Company or any of its Subsidiaries,
or to compel the Company or any of its Subsidiaries to dispose of or hold
separate all or any portion of its businesses or assets, where such portion or
portions of such
39
business(es) or assets, as the case may be, constitute a material portion of the
total businesses or assets of the Company or its Subsidiaries; and
(e) The Advances to be made and the use of proceeds or the issuance of
such Letters of Credit thereof shall not contravene, violate or conflict with,
or involve the Agent or any Lender in a violation of, any Applicable Law.
(f) each Notice of Borrowing given by the Company in accordance with
Section 2.02(a) hereof or issuance of a Letter of Credit and the acceptance by
the Company of the proceeds of any Borrowing shall constitute a representation
and warranty by the Company, made as of the time of the making of such Borrowing
or the issuance of such Letter of Credit that the conditions specified in
Section 3.02(a) have been fulfilled as of such time unless a notice to the
contrary specifically captioned "Disclosure Statement" is received by each of
the Lenders from the Company prior to 5:00 p.m. (Ft. Lauderdale, Florida time)
on the Business Day immediately preceding the date of the making of such
Borrowing. To the extent that the Lenders agree to make such Borrowing after
receipt of a Disclosure Statement in accordance with the preceding sentence, the
representations and warranties pursuant to the preceding sentence will be deemed
made as modified by the contents of such Disclosure Statement and repeated, as
so modified, as at the time of the making of such Borrowing. Any such
modification shall be effective only for the occasion on which the Lenders elect
to make an Advance on such Borrowing, and unless expressly agreed by the
Required Lenders in writing to the contrary in accordance with Section 10.02,
shall not be deemed a waiver or modification of any condition to the making of
any future Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company and the Subsidiaries represent and warrant as follows:
SECTION 4.01 Corporate Status of Company; Status of Subsidiaries. The
Company and each Subsidiary that is a corporation are duly organized, validly
existing and in good standing under the laws of the jurisdictions of their
respective incorporation and have the corporate power and authority to own their
respective property and assets and to transact the businesses in which they
respectively are engaged or presently propose to engage and are duly qualified
and in good standing as foreign corporations in all states where failure to be
so qualified and in good standing could have a Materially Adverse Effect. Each
Subsidiary that is a partnership is duly constituted, existing and in good
standing under the laws of the jurisdiction of its constitution and has all
requisite power, authority and legal right to own its property and assets and to
transact the businesses in which it is engaged or presently proposes to engage
and is duly qualified and in good standing as a foreign partnership wherever
failure to be so qualified and in good standing could have a Materially Adverse
Effect. The Company and each of its Subsidiaries have the power to own their
respective properties and to carry on their respective businesses as now being
conducted. The Company is adequately capitalized for the purpose of conducting
its business, was not formed solely for the purpose of acting as agent for, or
as an instrumentality of, any Subsidiary.
SECTION 4.02 Corporate Power and Authority. Each of the Company and the
Guarantors has the corporate power and has taken all necessary corporate action
(including, without limitation, any consent of stockholders required by law or
by its certificate of incorporation or bylaws) to authorize it, to execute,
deliver and carry out the terms and provisions of and to incur its obligations
under this Agreement, the Notes, the Security Documents and the other Loan
Documents to which it is a party. This Agreement, the Notes, the Security
Documents and the other Loan Documents have been duly authorized, executed and
delivered by the Company and the Guarantors party thereto.
SECTION 4.03 Compliance with Other Instruments. The execution, delivery
and performance by the Company and any Guarantors party thereto, as the case may
be, of this Agreement, the Notes, the Security Documents and the other Loan
Documents to which it is a party, (a) will not contravene any provision of
Applicable Law, rule, regulation, judgment, order or ruling, (b) will not
conflict with, be inconsistent with, or result in any breach of any of the
terms, covenants, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of any Lien upon any of the property or
assets of the Company or any of its Subsidiaries pursuant to the terms of any
indenture, mortgage, deed to secure debt, deed of trust, or any other material
agreement or instrument to which the Company or any of its Subsidiaries is a
signatory or by which it is bound or to which it may be subject, (c) will not
violate any provision of the certificate of incorporation (or equivalent
thereof) or bylaws (or equivalent thereof) of the Company or any corporate
Subsidiary of the Company or the certificate of partnership or other document
governing the constitution or conduct of affairs of any Subsidiary of the
Company that is not a corporation, (d) will not require any Governmental
Approval and (e) will not result in the creation of any Lien upon the assets or
properties of the Company and its Subsidiaries except as contemplated by the
Security Documents. Neither the Company nor any of its Subsidiaries is a party
to, or otherwise subject to any provision contained in, any instrument
evidencing Indebtedness of the Company or any of its Subsidiaries, any agreement
relating thereto or any other contract or agreement (including its charter)
which limits the amount of, or otherwise imposes restrictions on the incurring
of, Indebtedness of the type to be evidenced by the Notes, other than the Senior
Subordinated Debt.
SECTION 4.04 Enforceable Obligations. This Agreement, the Notes, the
Security Documents and the other Loan Documents constitute the legal, valid and
binding obligation of the Company and the Guarantors party thereto, enforceable
in accordance with their terms, except as the enforceability thereof may be
limited by Bankruptcy Law and by general principles of equity.
SECTION 4.05 Governmental Authorizations. The Company and its
Subsidiaries are in good standing with respect to all governmental
authorizations, consents,
41
approvals, orders, licenses and other actions required by any governmental or
non-governmental authority or Person, except where the failure to maintain such
good standing will not have a Materially Adverse Effect on the Company and its
Subsidiaries.
SECTION 4.06 Intellectual Property. Each of the Company and its
Subsidiaries owns or has the right to use all patents, trademarks, service
marks, trade names, copyrights, licenses and other rights, free from burdensome
restrictions, which are material for the operation of its business as presently
conducted. Nothing has come to the attention of the Company, any of its
Subsidiaries or any of their respective directors and officers to the effect
that (i) any product, process, method, substance, part or other material
presently contemplated to be sold by or employed by Company or any of its
Subsidiaries in connection with its business may infringe any patent, trademark,
service xxxx, trade name, copyright, license or other right owned by any other
Person, (ii) there is pending or threatened any claim or litigation against or
affecting the Company or any of its Subsidiaries contesting its right to sell or
use any such product, process, method, substance, part or other material or
(iii) there is, or there is pending or proposed, any patent, invention, device,
application or principle or any statute, law, rule, regulation, standard or code
which would prevent, inhibit or render obsolete the production or sale of any
products of, or substantially reduce the projected revenues of, or otherwise
have a Materially Adverse Effect on the Company or any of its Subsidiaries.
SECTION 4.07 Outstanding Indebtedness. Neither the Company nor any of
its Subsidiaries, on a consolidated basis, has outstanding any Indebtedness,
except as described on Schedule 4.07 hereto. There exists no default under the
provisions of any instrument evidencing or securing any Indebtedness of the
Company or any of its Subsidiaries or of any agreement otherwise relating
thereto which has had or would reasonably be expected to have a Materially
Adverse Effect.
SECTION 4.08 Insurance Coverage. Each property of the Company or any of
its Subsidiaries is insured within terms reasonably acceptable to the Lenders
for the benefit of the Company or a Subsidiary of the Company in amounts deemed
adequate by the Company's management in its reasonable business judgment and not
materially less than those amounts customary in the industry in which the
Company and its Subsidiaries operate against risks usually insured against by
Persons operating businesses similar to those of the Company or its Subsidiaries
in the localities where such properties are located, and the Agent has been
named loss payee or additional insured, as its interest may appear, on all such
policies. Attached as Schedule 4.08 hereto are certificates evidencing such
insurance.
SECTION 4.09 Title to Properties. Each of the Company and its
Subsidiaries has (i) good and marketable fee simple title to its respective real
properties (other than real properties it leases from others), including such
real properties reflected in the financial statements referred to in Section
4.14, subject to no Lien of any kind except Liens permitted by Section 6.01, and
(ii) good title to all of its other respective properties and assets (other than
properties and assets which it leases from others), including the other
properties and assets reflected in the financial statements referred to in
Section 4.14, subject to no Lien of any kind
42
except Liens permitted by Section 6.01. Each of the Company and its Subsidiaries
enjoys peaceful and undisturbed possession in all material leases necessary for
the operation of its respective properties and assets, none of which contains
any unusual or burdensome provisions that would adversely affect or impair the
operation of such properties and assets, and all such leases are valid and
subsisting and in full force and effect.
SECTION 4.10 No Burdensome Restrictions. Neither the Company nor any of
its Subsidiaries is a party to any contract or agreement that would result in
any burdensome restrictions that might reasonably be expected to have a
Materially Adverse Effect on the Company or any of its Subsidiaries, including,
but not limited to, any collective bargaining agreements.
SECTION 4.11 No Material Violation of Law. Neither the Company nor any
of its Subsidiaries has any notice of any violation of any law, statute, order,
regulation or judgment entered against it by any court that may reasonably be
expected to have a Materially Adverse Effect on the Company.
SECTION 4.12 No Default Under Other Agreements. Neither the Company nor
any of its Subsidiaries is in default under any material agreement to which it
is a party.
SECTION 4.13 No Equity Investments. Neither the Company nor any of its
Subsidiaries possesses investments in any equity or other long-term investments
in any person, except permitted investments, including any wholly-owned
Subsidiaries of the Company and the Subsidiaries.
SECTION 4.14 Financial Statements. The audited consolidated financial
statements of the Company dated June 30, 1998, and the related consolidated
statements of income (including supporting footnote disclosures), with opinion
of Xxxxxxxx, Xxxxx & Xxxxx LLP, the unaudited consolidated quarterly financial
statements of the Company dated December 31, 1998, and the related consolidated
statements of income (including supporting footnote disclosures), and the
unaudited consolidated monthly financial statements of the Company dated
February 28, 1999, all heretofore furnished to the Lenders, are all true and
correct in all material respects and present fairly the consolidated financial
condition at the date of said financial statements and the results of operations
for the fiscal period then ending of the Company. The Company as of such date
did not have any significant liabilities, contingent or otherwise, including
liabilities for Taxes or any unusual forward or long-term commitments which were
not disclosed by or reserved against in the financial statements referred to
above or in the notes thereto, and at the present time there are no material
unrealized or anticipated losses from any unfavorable commitments of the Company
or any of its Subsidiaries. All such financial statements have been prepared in
accordance with GAAP applied on a consistent basis throughout the periods
involved. Since December 31, 1998, there has been no change which has had or
could reasonably be expected to have a Materially Adverse Effect.
43
SECTION 4.15 Litigation. Except as disclosed on Schedule 4.15 attached
hereto, there are no actions, suits, investigations or proceedings pending or,
to the knowledge of the Company or any of its Subsidiaries, threatened against
or affecting the Company or any of its Subsidiaries or any of their properties
or rights by or before any court, arbitrator or administrative or governmental
body that would have a Materially Adverse Effect on the Company or any of its
Subsidiaries.
SECTION 4.16 Taxes. Each of the Company and its Subsidiaries has filed
or caused to be filed all declarations, reports and tax returns including, in
the case of the Company and each Subsidiary located in the United States, all
federal and state income tax returns which it is required by law to file, and
has paid all Taxes which are shown as being due and payable on such returns or
on any assessments made against it or any of its properties. The accruals and
reserves on the books of the Company and its Subsidiaries in respect of Taxes
are adequate in all material respects for all periods. Neither the Company nor
any of its Subsidiaries has any knowledge of any unpaid adjustment, assessment
or any penalties or interest of significance, or any basis therefor, by any
taxing authority for any period, except those being contested in good faith and
by appropriate proceedings which effectively stay the enforcement of any Lien
and the attachment of a penalty.
SECTION 4.17 Margin Regulations. No part of the proceeds of any of the
Advances will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the applicable Margin
Regulations.
SECTION 4.18 ERISA. Except as disclosed on Schedule 4.18 attached
hereto:
(a) Identification of Plans. (i) Neither the Company nor any ERISA
Affiliate maintains or contributes to, or has maintained or contributed to, any
Plan that is an ERISA Plan, and (ii) neither the Company nor any of its
Subsidiaries maintains or contributes to, or has maintained or contributed to,
any Plan that is an Executive Arrangement;
(b) Compliance. Each Plan has at all times been maintained, by its
terms and in operation, in accordance with all Applicable Laws, except such
noncompliance (when taken as a whole) that will not have a Materially Adverse
Effect;
(c) Liabilities. Neither the Company nor any of its Subsidiaries is
currently nor has in the last 6 years been obligated to make contributions
(directly or indirectly) to a Multiemployer Plan, nor is it currently nor will
it become subject to any liability (including withdrawal liability), tax or
penalty whatsoever to any Person whomsoever with respect to any Plan including,
but not limited to, any tax, penalty or liability arising under Title I or Title
IV or ERISA or Chapter 43 of the Code, except such liabilities (when taken as a
whole) as will not have a Materially Adverse Effect; and
44
(d) Funding. The Company and each ERISA Affiliate has made full and
timely payment of all amounts (i) required to be contributed under the terms of
each Plan and Applicable Law and (ii) required to be paid as expenses of each
Plan. No Plan has an "amount of unfunded benefit liabilities" (as defined in
Section 4001(a)(18) of ERISA).
SECTION 4.19 Compliance With Environmental Laws.
(a) The Company and its Subsidiaries are not in violation of, and do
not presently have outstanding any liability under, have not been notified that
they are or may be liable under and do not have knowledge of any liability or
potential liability (including any liability relating to matters set forth in
Part A. of Schedule 4.19) except as set forth in Part A. of Schedule 4.19, under
any applicable Environmental Laws which violation, liability or potential
liability could reasonably be expected to have a Materially Adverse Effect.
(b) Except as set forth in Part B. of Schedule 4.19, neither the
Company nor any of its Subsidiaries has received a written request for
information under any Environmental Laws stating or suggesting that the Company
or any of its Subsidiaries has or may have liability thereunder or written
notice that any such entity has been identified as a potentially responsible
party under any Environmental Laws, or any comparable state law, or any public
health or safety or welfare law, nor has any such entity received any written
notification that any Hazardous Substance that it or any of its respective
predecessors in interest has generated, stored, treated, handled, transported,
or disposed of, has been released or is threatened to be released at any site at
which any Person intends to conduct or is conducting a remedial investigation or
other action pursuant to any Environmental Laws.
(c) Except as set forth in Part C. of Schedule 4.19, each of the
Company and its Subsidiaries has obtained all material permits, licenses or
other authorizations required for the conduct of their respective operations
under all applicable Environmental and Asbestos Laws and each such authorization
is in full force and effect.
(d) Except as set forth in Part D. of Schedule 4.19, each of Company
and its Subsidiaries complies in all material respects with all laws and
regulations relating to equal employment opportunity and employee safety in all
jurisdictions in which it is presently doing business, and Company will use its
reasonable best efforts to comply, and to cause each of its Subsidiaries to
comply, with all such laws and regulations which may be legally imposed in the
future in jurisdictions in which Company or any of its Subsidiaries may then be
doing business.
SECTION 4.20 Possession of Material Patents, Trademarks, Etc. Each of
the Company and its Subsidiaries possesses all patents, trademarks, licenses,
and other intellectual property rights that are necessary in any material
respect for the ownership, maintenance and operation of its properties and
assets and they are possessed free from any burdensome restrictions. To the
Company's knowledge, there are no infringements of such patents, trademarks,
licenses, and other intellectual property rights that could have a Materially
Adverse Effect on the Company or any of its Subsidiaries.
45
SECTION 4.21 Subsidiaries. Schedule 4.21 attached hereto correctly sets
forth the name of each Subsidiary of the Company, the jurisdiction of such
Subsidiary's incorporation or organization and the ownership of all issued and
outstanding capital stock of such Subsidiary. All the outstanding shares of the
capital stock of each such Subsidiary have been validly issued and are fully
paid and nonassessable and all such outstanding shares, except as noted on such
Schedule 4.21, are owned of record and beneficially by the Company or a
wholly-owned Subsidiary of the Company free of any Lien or claim, except for
Liens in favor of the Agent.
SECTION 4.22 Disclosure. Neither this Agreement, any Loan Document nor
any other document, certificate or statement furnished to the Lenders or the
Agent by or on behalf of the Company or any Guarantor in connection herewith
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained herein and therein not
misleading, if, in either case, such fact is material to an understanding of the
financial condition, business, prospects or property of the Company, or the
ability of the Company to fulfill its obligations under any Loan Documents to
which it is a party.
SECTION 4.23 Year 2000 Compliance. The Company has taken all action
reasonably determined to be necessary to ensure that the operating systems for
the Company's and its Subsidiaries' computers and all software applications that
run on such computers are Year 2000 Compliant or will be Year 2000 Compliant no
later than December 31, 1999, except where a failure to be Year 2000 Compliant
will not have a Materially Adverse Effect. "Year 2000 Compliant" means that
neither the performance nor functionality of the operating systems for the
Company's and its Subsidiaries' computers, embedded microchips and all software
applications that run on such computers is affected by dates prior to, during,
spanning or after January 1, 2000, and shall include, but not be limited to (a)
accurately processing (including, but not limited to calculating, comparing and
sequencing) date and time data from, into, and between the years 1999 and 2000
and leap year calculations, (b) functioning without error, interruption or
decreased performance relating to such date and time data, (c) accurately
processing such date and time data when used in combination with other
technology, if the other technology properly exchanges date and time data, (d)
accurate date and time data century recognition, (e) accurately calculating,
using same-century and multi-century formulas and date and time values, (f)
reflecting the correct century in date and time data interface values, and (g)
processing, storing, receiving and outputting all date and time data in a format
that accurately indicates the century of the date and time data.
SECTION 4.24 Projections. In the good faith judgment of the Chief
Financial Officer and Chief Executive Officer of the Company the projections, a
copy of which are attached hereto as Exhibit M, constitute the prospects of
financial performance of the Company for the periods indicated in such
projections, absent unanticipated changed circumstances or events, many of which
are beyond the Company's control.
46
ARTICLE V
AFFIRMATIVE COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, unless the Required Lenders shall otherwise consent in
writing:
SECTION 5.01 Use of Proceeds. The proceeds of all Borrowings will be
used by the Company as provided in Section 2.15. None of the proceeds of any
Borrowing shall be used, directly or indirectly, to purchase or carry, or to
reduce or retire or refinance any credit incurred to purchase or carry, any
"margin security" or "margin stock" (within the meaning of the regulations of
the Board of Governors of the Federal Reserve System) or to extend credit to
others for the purpose of purchasing or carrying any such "margin security" or
"margin stock" or for any other purpose that might deem this transaction as a
"purpose credit" (within the meaning of the regulations of the Board of
Governors of the Federal Reserve System). If requested by any Lender, the
Company will furnish to such Lender statements in conformity with the
requirements of Federal Reserve Form U-1 referred to in Regulation U.
SECTION 5.02 Reporting Covenants.
(a) The Company will furnish to the Agent for distribution to each of
the Lenders:
(i) as soon as available and in any event no later than 90 days
after the end of each fiscal year of the Company, an audited
consolidated balance sheet of the Company and its Subsidiaries as of
the close of such fiscal year, and the related audited consolidated
statements of income and cash flow of the Company and its Subsidiaries
for such fiscal year, all in reasonable detail and with (1) an
unqualified opinion of Xxxxxxxx, Xxxxx & Xxxxx LLP, or such other
independent certified public accountant of recognized standing selected
by the Company and satisfactory to the Required Lenders, and (2) a
certificate (with supporting details and calculations of financial
covenants) from the Chief Financial Officer of the Company stating
whether a Default or Event of Default exists;
(ii) as soon as available and in any event within 45 days after the
end of each fiscal quarter of the Company, its quarterly unaudited
financial statements, together with a certificate in the form of
Exhibit I hereto (the "Compliance Certificate") by the Chief Financial
Officer of the Company (with supporting details and calculations of
financial covenants) stating that (x) the financials were prepared in
accordance with GAAP (subject to customary year-end audit adjustments)
and that the covenants described in Article VII have been met and (y)
whether a Default or Event of Default exists;
47
(iii) as soon as available and in any event within 30 days after the
end of each month, the monthly unaudited financial statements of the
Company;
(iv) as soon as available and in any event within 30 days after the
end of each month, a completed Borrowing Base Certificate in the form
of Exhibit K hereto (the "Borrowing Base Certificate");
(v) as soon as available and in any event not later than 30 days
after the end of each fiscal year of the Company, financial projections
for the following fiscal year, in a form satisfactory to Agent;
(vi) until the Company is Year 2000 Compliant, within 45 days after
the end of each fiscal quarter of the Company, a report evidencing and
outlining the Company's progress toward becoming Year 2000 Complaint;
and
(vii) as soon as available and in any event within 45 days after the
end of each month, a completed Depot by Depot Report in the form of
Exhibit L hereto (the "Depot by Depot Report"), including revenues and
gross profits for each Depot, calculated on a trailing three month
basis.
In each case, such financial statements shall include balance sheets,
income statements, and statements of cash flows for the Company, provided,
however, that the monthly financial statements provided by the Company to the
Lenders shall not include a statement of cash flows.
(b) The Company will furnish to each of the Lenders, with reasonable
promptness, notice of certain other events, including the occurrence or
existence of any Default or Event of Default, any citation for a material
violation of environmental laws or regulations, important matters relating to
funding of employee benefit plans, or such other information as any Lender or
the Agent may reasonably request.
SECTION 5.03 Maintenance of Properties. The Company shall, and shall
cause each of its Subsidiaries to, maintain, preserve, protect and keep, or
cause to be maintained, preserved, protected and kept, its properties and every
part thereof in good repair, working order and condition, and from time to time
will make or cause to be made all needful and proper repairs, renewals,
replacements, extensions, additions, betterments, and improvements thereto, so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times other than those which the failure to
maintain would in the aggregate, have no Materially Adverse Effect; provided,
however, that the Company and each Subsidiary shall not be under any obligation
to repair or replace any such properties which have become obsolete or have
become unsuitable or inadequate for the purpose for which they are used.
SECTION 5.04 Maintenance of Insurance. The Company shall, and shall
cause each of its Subsidiaries to, (i) maintain liability and worker's
compensation insurance with financially sound and reputable insurers (or
maintain a legally sufficient, fully funded, program
48
of self insurance against worker's compensation liabilities), and also maintain
adequate insurance on its properties against such hazards and in at least such
amounts as is customary in the business, and (ii) name the Agent as loss payee
or additional insured, as its interest may appear, on each of such insurance
policies. At the request of any Lender, the Company will forthwith deliver an
officer's certificate specifying the material details of such insurance in
effect.
SECTION 5.05 Maintenance of Books; Inspection of Property and Records.
The Company shall, and shall cause each of its Subsidiaries to, keep proper
books of record and account containing complete and accurate entries in all
material respects of all of their respective financial and business transactions
and prepare or cause to be prepared its annual statements and reports in
accordance with GAAP. The Company shall, and shall cause each of its
Subsidiaries to, permit any person designated by any Lender to visit and inspect
any of its properties, corporate books and financial records, to make copies and
take extracts therefrom, and to discuss its accounts, affairs, and finances with
the principal officers of the Company and such Subsidiary during reasonable
business hours, all at such times as the Lenders may reasonably request;
provided, however, that any time following the occurrence and continuance of an
Event of Default, no prior notice to the Company and such Subsidiary shall be
required. The Company shall, and shall cause each of its Subsidiaries to,
prepare or cause to be prepared its interim statements and reports in accordance
with GAAP, subject to usual and customary year end audit and adjustments and
footnote disclosures.
SECTION 5.06 Existence and Status. The Company shall, and shall cause
each of its Subsidiaries that is a corporation to, maintain its corporate
existence, its material rights, franchises and licenses (for the scheduled
duration thereof), its patents, trademarks, trade names, service marks and other
intellectual property rights necessary or desirable in the normal conduct of its
business, its good standing in its state of incorporation and its qualification
and good standing as a foreign corporation in all jurisdictions where its
ownership of property or its business activities cause such qualification to be
required and the failure to do so could have a Materially Adverse Effect. The
Company shall cause each Subsidiary that is not a corporation to maintain its
present form of existence, its material rights, franchises and licenses (for the
scheduled duration thereof), its patents, trademarks, tradenames, service marks
and other intellectual property rights necessary or desirable in the normal
conduct of its business, its good standing in the jurisdiction of its
constitution and its qualification and good standing as a foreign entity in all
jurisdictions where its ownership of property or its business activities cause
such qualification to be required and the failure to do so could have a
Materially Adverse Effect.
SECTION 5.07 Taxes and Claims. The Company shall, and shall cause each
of its Subsidiaries to, pay and discharge (i) all Taxes prior to the date on
which penalties attach thereto, and (ii) all claims (including, without
limitation, claims for labor, materials, supplies or services) (collectively
"Other Claims") which, if unpaid, might become a Lien upon any of its property;
provided, however, that the Company and its Subsidiaries shall not be required
to pay and discharge any such Tax or Other Claim so long as the legality or
amount thereof shall be promptly contested in good faith and by appropriate
proceedings which
49
effectively stay the enforcement of any Lien and the attachment of a penalty and
the Company or such Subsidiary, as the case may be, shall have set aside
appropriate reserves therefor in accordance with GAAP.
SECTION 5.08 Compliance with Laws, Etc. The Company shall, and shall
cause each of its Subsidiaries to, comply with all Applicable Law (including,
without limitation, the Environmental Laws and Employee Benefit Laws) and
Contractual Obligations applicable to or binding on any of them where the
failure to comply with such Applicable Law and Contractual Obligations would
reasonably be expected to have a Materially Adverse Effect.
SECTION 5.09 ERISA. The Company shall, and shall cause each of its
Subsidiaries to, deliver to each of the Lenders:
(a) Promptly after the discovery of the occurrence thereof with respect
to any Plan, or any trust established thereunder, notice of (A) a "reportable
event" described in Section 4043 of ERISA and the regulations issued from time
to time thereunder (other than a "reportable event" not subject to the
provisions for 30-day notice to the PBGC under such regulations), or (B) any
other event which could subject the Company or any ERISA Affiliate to any
material tax, penalty or liability under Title I or Title IV of ERISA or Chapter
43 of the Code;
(b) At the same time and in the same manner as such notice must be
provided to the PBGC, or to a Plan participant, beneficiary or alternative
payee, any notice required under Section 101(d), 302(f)(4), 303(e), 307(e),
4041(b)(1)(A) or 4041(c)(1)(A) of ERISA or Section 412(f) of the Code with
respect to any Plan; and
(c) Upon the request of any Lender, (A) true and complete copies of any
and all documents, government reports and determination or opinion letters (if
any) for any Plan, or (B) a current statement of withdrawal liability for each
Multiemployer Plan.
SECTION 5.10 Litigation. The Company shall give prompt written notice
to each of the Lenders of (a) any judgment entered by a court, tribunal,
administrative agency or arbitration panel in which the amount of liability is
$250,000 or more in excess of insurance coverage, or in which the aggregate
amount of liability is $500,000 or more in excess of insurance coverage, and (b)
any disputes which may exist between the Company or any of its Subsidiaries and
any governmental or regulatory body, in which the amount in controversy is
$250,000 or more and which may materially and adversely affect the normal
business operations of the Company or any of its Subsidiaries or any of their
respective properties and assets. The Company shall provide each of the Lenders,
on a quarterly basis, concurrently with the delivery of the Compliance
Certificate as provided under Section 5.02(a)(ii), a report which shall set
forth each action, proceeding or claim, of which the Company or any of its
Subsidiaries has notice, which is commenced or asserted against the Company, and
in which the amount claimed or the potential liability is $250,000 or more.
50
SECTION 5.11 Notice of Events of Default. The Company shall deliver to
each of the Lenders within five (5) days after any Executive Officer obtains any
knowledge of any condition, event or act which creates or causes a Default or an
Event of Default, a certificate signed by an officer of the Company specifying
the nature thereof, the period of existence thereof and what action the Company
or such Subsidiary proposes to take with respect thereto.
SECTION 5.12 Stockholder Reports, etc. Contemporaneously with the
sending or filing thereof, the Company will provide to the Agent for
distribution to each of the Lenders copies of all proxy statements, financial
statements, and reports which the Company sends to its stockholders, and copies
of all regular, periodic, and special reports, and all statements which the
Company files with the Securities and Exchange Commission or any governmental
authority which may be substituted therefor, or with any national securities
exchange.
SECTION 5.13 Future Guarantors.
(a) Subject to any prohibitions or limitations as to power or authority
imposed by law applicable to any such Subsidiary, the Company shall cause (1)
each Person incorporated or otherwise organized in the United States that
hereafter becomes a Subsidiary (an "Additional Guarantor") to become a Guarantor
under the Guaranty Agreement and to create a security interest in favor of the
Lenders in all of its assets, including, to the extent owned by such Guarantor,
100% of the stock of other Subsidiaries, to the Agent upon the creation of such
Additional Guarantor by executing and delivering to the Agent the Supplemental
Documents; and (2) each Person that owns the stock of the Additional Guarantor
to pledge and deliver such stock to the Agent, together with a supplement to the
Company Pledge Agreement or Guarantor Pledge Agreement, as the case may be, and
with stock powers or other appropriate instruments of transfer executed by such
Person in blank.
(b) The Additional Guarantor shall also deliver to the Agent and the
Lenders, simultaneously with the Supplemental Documents, (1) Certified Requests
for Information or Copies (Form UCC-11) or equivalent reports, showing that
there are no effective financing statements which name the Additional Guarantor
as debtor and (2) an opinion rendered by legal counsel to such Additional
Guarantor and the Person required to pledge the shares of stock of the
Additional Guarantor under the Security Documents to the Agent, addressing the
types of matters set forth in Exhibit G and Exhibit H hereof and such other
matters as the Lenders may reasonably request, addressed to the Agent and the
Lenders.
SECTION 5.14 Ownership of Guarantors. The Company and its Subsidiaries
that own Guarantors shall maintain their percentage ownership of such Guarantors
existing as of the date hereof and shall not decrease its ownership percentage
in each Additional Guarantor pursuant to Section 5.13 after the date hereof, as
such ownership exists at the time such Additional Guarantor becomes a Guarantor
hereunder.
51
SECTION 5.15 Interest Rate Protection. The Company shall enter into and
maintain until the Commitment Termination Date an agreement providing for
payments which are related to fluctuations of interest rates by which the
Company is protected against changes in the variable rates of interest payable
on its indebtedness as to a notional amount of approximately fifty percent (50%)
of Senior Funded Debt less the aggregate outstanding amount of Subordinated Debt
with one or more Lenders.
SECTION 5.16 Cost of Products Sold. The Company shall calculate Cost of
Products Sold in a manner consistent with its calculations prior to the Closing
Date and shall include in such calculation all of the line items set forth on
Schedule 1.01.
ARTICLE VI
NEGATIVE COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, without the written consent of the Required Lenders
(unless otherwise provided herein):
SECTION 6.01 Limitation on Liens and Security Interests. The Company
shall not, and shall not permit any of its Subsidiaries to, create, incur,
assume or suffer to exist, any Lien or other encumbrance of any kind on any of
its properties or assets, real or personal, wherever located, including assets
hereafter acquired, except
(a) Liens existing on the date hereof and described on Schedule 6.01;
(b) Liens in favor of the Agent;
(c) Liens for Taxes not yet payable or being contested in good faith
and by appropriate proceedings;
(d) deposits or pledges to secure payments of workmen's compensation,
unemployment insurance, old age pension and other social security obligations;
(e) mechanics', carriers', workmen's, repairmen's, landlord's, or other
Liens arising in the ordinary course of business securing obligations which are
not overdue for a period longer than 60 days, or which are being contested in
good faith by appropriate proceedings;
(f) pledges or deposits to secure performance in connection with bids,
tenders, contracts (other than contracts for the payment of money) or leases
made in the ordinary course of the business of the Company or any of its
Subsidiaries;
52
(g) deposits to secure, or in lieu of, surety and appeal bonds to which
the Company or a Subsidiary of the Company is a party;
(h) deposits in connection with the prosecution or defense of any claim
in any court or before any administrative commission or agency;
(i) Liens arising out of judgments or awards with respect to which the
Company or a Subsidiary of the Company at the time shall in good faith be
diligently prosecuting an appeal or proceedings for review and with respect to
which it shall have secured a stay of execution pending such appeal or
proceedings for review;
(j) purchase money security interests, and leases in the nature
thereof, for equipment and machinery or mortgages for real estate, in each case
purchased in the ordinary course of business and to be used in the conduct of
its business, provided that any such security interest or mortgage secures only
the repayment of the purchase price of such machinery, equipment or real estate
and any such lease obligations do not exceed the purchase price of such
machinery, equipment or real estate;
(k) Liens on fixtures in connection with existing mortgages on real
property or mortgages permitted hereunder;
(l) zoning restrictions, easements, licenses, reservations and
restrictions on the use of real property or minor irregularities thereto that do
not materially detract from the use thereof or the assets of the Company; and
(m) Liens incurred on pledges or deposits in connection with workers'
compensation, unemployment insurance, old age or Social Security benefits.
SECTION 6.02 Indebtedness. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to exist, any
Indebtedness, other than:
(a) Indebtedness evidenced by this Agreement and by the Notes;
(b) Indebtedness outstanding on the date hereof which is set forth
on Schedule 4.07 hereto and any refinancings thereof in a principal
amount equal to, and on terms and conditions substantially similar to,
such Indebtedness, as reasonably determined by the Agent and
Indebtedness to be issued after the Closing Date pursuant to the Third
Amendment to Senior Subordinated Debt in aggregate amount not to exceed
$5,000,000;
(c) secured Indebtedness to the extent permitted by clause (j) of
Section 6.01 above;
53
(d) unsecured current liabilities (not resulting from any
borrowing) incurred in the ordinary course of business for current
purposes and not represented by a promissory note or other evidence of
indebtedness;
(e) Indebtedness related to interest rate swaps or xxxxxx, or to
hedge the Company's variable interest rate exposure;
(f) Indebtedness incurred and consented to in writing by the
Lenders; or
(g) Indebtedness incurred by the Company to make acquisitions that
are permitted by Section 6.08(b), in the form of notes issued to the
seller of the stock or assets, which notes shall be subordinated to the
Obligations on terms and conditions satisfactory to the Lenders.
SECTION 6.03 Compliance with ERISA. The Company shall not take or fail
to take, or permit any of its Subsidiaries or ERISA Affiliates to take or fail
to take, any action with respect to a Plan including, but not limited to, (i)
establishing any Plan, (ii) amending any Plan, (iii) terminating or withdrawing
from any Plan, or (iv) incurring an "amount of unfunded benefit liabilities", as
defined in Section 4001(a)(18) of ERISA, or any withdrawal liability under Title
IV of ERISA, where such action or failure could have a Materially Adverse
Effect, result in a Lien on the property of the Company or any of its
Subsidiaries or require the Company or any of its Subsidiaries to provide any
security, except to the extent permitted pursuant to Section 6.01 hereof.
SECTION 6.04 Sale and Leaseback. The Company shall not, and shall not
permit any of its Subsidiaries to, enter into any transaction with any other
entity whereby such other entity leases assets sold or otherwise transferred to
it by the Company or such Subsidiary.
SECTION 6.05 Transactions with Affiliates. The Company shall not, and
shall not permit any of its Subsidiaries to:
(a) Enter into any material transaction or series of related
transactions which in the aggregate would be material, whether or not in the
ordinary course of business, with any affiliate of the Company or any of its
Subsidiaries (but excluding any affiliate which is the Company or any of its
Subsidiaries), other than on terms and conditions substantially as favorable to
the Company or such Subsidiary as would be obtained by the Company or such
Subsidiary at the time in a comparable arm's-length transaction with a Person
other than an affiliate.
(b) Convey or transfer to any other Person (including the Company or
any of its Subsidiaries) any real property, buildings, or fixtures used in the
manufacturing or production operations of the Company or any of its
Subsidiaries, or convey or transfer to the Company or any of its Subsidiaries
any other assets (excluding conveyances or transfers in the ordinary
54
course of business) if at the time of such conveyance or transfer any Default or
Event of Default exists or would exist as a result of such conveyance or
transfer.
SECTION 6.06 Guaranties. The Company shall not, and shall not permit
any of its Subsidiaries to, create, incur, assume, guarantee, suffer to exist or
otherwise become liable on or with respect to, directly or indirectly, any
guaranties other than:
(a) endorsements of instruments for deposit or collection in the
ordinary course of business; or
(b) guarantees of Indebtedness owed by any Consolidated Company to
another Consolidated Company.
SECTION 6.07 Limitations on Payment Restrictions. Except as provided
under the Senior Subordinated Debt, the Company shall not, and shall not permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective, any consensual encumbrance or restriction on the ability of
the Company or any of its Subsidiaries to (i) pay dividends or make any other
distributions on stock of the Company or any of its Subsidiaries, (ii) pay any
indebtedness owed to the Company or any of its Subsidiaries, or (iii) transfer
any of its property or assets to the Company or any of its Subsidiaries except
any consensual encumbrance or restriction existing under the Loan Documents.
SECTION 6.08 Merger; Joint Ventures; Sale of Assets; Acquisitions. The
Company shall not, and shall not permit any of its Subsidiaries to:
(a) merge or consolidate with any other entity, except the foregoing
restrictions shall not be applicable to:
(i) mergers or consolidations of (x) any Subsidiary with any other
Subsidiary which is a Guarantor or (y) any Subsidiary with the Company;
or
(ii) mergers or consolidations in which any Person engaged in
business in which the Company is engaged as of the Closing Date or
substantially related thereto merges or consolidates with the Company
or any of its Subsidiaries where the surviving corporation is the
Company or such Subsidiary;
(b) purchase, lease or otherwise acquire for cash, stock or other
consideration, the stock of any Person or all or any substantial portion of the
assets of any Person, provided, that the Company may acquire stock or all or a
substantial portion of the assets of a Person if the purchase price for all such
acquisitions, whether in cash, stock or other consideration, does not exceed
$1,000,000 in the aggregate; or
(c) enter into a partnership or joint venture with any other entity;
provided, however, that so long as no Event of Default has occurred, the Company
or any of its
55
Subsidiaries may request that the Required Lenders consent to its entering into
a partnership or joint venture for the purposes of carrying on its business; or
(d) sell, lease, transfer or otherwise dispose of any assets, except
that this Section 6.08 shall not prohibit any disposition of (i) any asset if on
the date such asset is sold, the Asset Value of all asset sales occurring after
the Closing Date, taking into account the Asset Value of the proposed asset
sale, would not exceed on an aggregate basis five percent (5%) of the
Consolidated Net Worth of the Company and its Subsidiaries on the Closing Date
and such sale is in the ordinary course of business, (ii) any obsolete or
retired property not used or useful in its business (such assets to include
high-pressure tanks, motorized vehicles, including cars and trucks, and lines of
business other than carbon dioxide that may be obtained by the Company as part
of the group of assets of any corporation or other business entity the Company
may acquire) or (iii) certain other sales to be agreed upon in writing by the
Company and the Required Lenders.
SECTION 6.09 Dividends; Loans, Advances.
(a) In any fiscal year of the Company, the Company shall not pay or
declare any cash dividends on any of its capital stock.
(b) The Company shall not, and shall not permit any of its Subsidiaries
to, make, permit or hold any loans or advances (not including accounts
receivable) to any Person, other than:
(i) Investments in Subsidiaries existing on the Closing Date;
(ii) direct obligations of the United States or any agency thereof,
or obligations guaranteed by the United States or any agency thereof,
in each case supported by the full faith and credit of the United
States and maturing within one year from the date of creation thereof;
(iii) commercial paper maturing within one year from the date of
creation thereof rated in the highest grade by a nationally recognized
credit rating agency;
(iv) time deposits maturing within one year from the date of
creation thereof with, including certificates of deposit issued by any
Lender and any office located in the United States of any bank or trust
company which is organized under the laws of the United States or any
state thereof and has total assets aggregating at least $500,000,000,
including without limitation, any such deposits in Eurodollars issued
by a foreign branch of any such bank or trust company;
(v) Investments made by Plans;
(vi) advances made by the Company or any of its Subsidiaries to its
56
employees during the ordinary course of business, and loans made by the
Company to its employees to allow such employees to purchase stock of
the Company (such loans to be evidenced by a promissory note and
pledged to the Agent pursuant to the terms of the Security Documents);
provided that the aggregate total of such advances made by the Company
to its employees under this Subsection shall not exceed $1,000,000 at
any time; and
(vii) deposits made by the Company in connection with acquisitions
of other business entities.
SECTION 6.10 Nature of Business. The Company shall not, and shall not
permit any of its Subsidiaries to, engage in any business or businesses other
than those engaged in by the Company or such Subsidiary on the date hereof;
provided, however, that nothing herein contained shall prevent the Company or
any of its Subsidiaries (i) from expanding the location of its business or
businesses in the United States, (ii) from ceasing or omitting to exercise any
rights, licenses, permits, or franchises which in good faith in the judgment of
the Company or such Subsidiary can no longer be profitably exercised, or (iii)
from engaging in a business or businesses that are ancillary to those engaged in
by the Company or such Subsidiary on the date hereof.
SECTION 6.11 Sale of Subsidiaries. The Company shall not, and shall not
permit any of its Subsidiaries to, sell or otherwise dispose of any shares of
capital stock of or other ownership interest in any Subsidiary of the Company
(except in connection with any acquisition, merger or consolidation permitted by
Section 6.08), or permit any Subsidiary of the Company to issue any additional
shares of its capital stock or other incidents of ownership, except on a pro
rata basis to all its stockholders, partners or owners, as the case may be and
provided that any such additional shares of capital stock or other incidents of
ownership issued to the Company, any Guarantor or Additional Guarantor are
pledged to the Agent.
SECTION 6.12 Negative Pledges. The Company shall not, and shall not
permit any of its Subsidiaries to, agree or covenant with any Person to restrict
in any way its ability to grant any Lien on its assets in favor of the Lenders,
except that this Section 6.12 shall not apply to (i) any covenants contained in
this Agreement or the Security Documents, (ii) the covenants contained in
Section 8.02 of the Senior Subordinated Note Purchase Agreement, and (iii)
covenants and agreements made in connection with Liens described in Section
6.01(j) but only if such covenant or agreement applies solely to the specific
machinery, equipment or real estate to which such Lien relates.
SECTION 6.13 Creation of Subsidiaries. Neither the Company nor any of
its Subsidiaries shall create or acquire any other Subsidiary or any other
affiliate after the Closing Date.
SECTION 6.14 Prepayments Under and Amendment of Other Agreements. The
Company shall not, and shall not permit any of its Subsidiaries to, make any
prepayments
57
under any Subordinated Debt document or amend or waive any material terms or
conditions under any Subordinated Debt document, or repurchase any notes issued
in connection with any Subordinated Debt without the written consent of the
Required Lenders, provided that no such consent shall be required with respect
to the cancellation or reduction by the Company of any Commitment of the
investors party to the Senior Subordinated Note Purchase Agreement to purchase
additional Senior Subordinated Debt in excess of the $10,000,000 pursuant to the
Third Amendment to Senior Subordinated Debt, after the date hereof.
SECTION 6.15 Capital Expenditures. The Company shall not, and shall not
permit any of its Subsidiaries to, make Capital Expenditures during any period
in excess of the amount listed for such period on Annex B attached hereto.
ARTICLE VII
FINANCIAL COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, without the consent of the Required Lenders:
SECTION 7.01 Senior Debt Coverage Ratio. The Company shall not permit
the Senior Debt Coverage Ratio as of the last day of each fiscal quarter to be
greater than (i) 3.65 to 1.00 for the period beginning on the Closing Date
through and including June 30, 1999; (ii) 3.35 to 1.00 for the period beginning
July 1, 1999 through and including September 30, 1999; (iii) 3.00 to 1.00 for
the period beginning October 1, 1999 through and including March 31, 2000; (iv)
2.75 to 1.00 for the period beginning April 1, 2000 through and including June
30, 2000; and (v) 2.50 to 1.00 thereafter.
SECTION 7.02 Interest Coverage Ratio. The Company shall not permit the
Interest Coverage Ratio as of the last day of any fiscal quarter of the Company
to be less than (i) 1.30 to 1.00 for the period beginning on the Closing Date
through and including June 30, 1999; (ii) 1.50 to 1.00 for the period beginning
July 1, 1999 through and including September 30, 1999; (iii) 1.75 to 1.00, for
the period beginning October 1, 1999 through and including December 31, 1999;
(iv) 2.25 to 1.00 for the period beginning January 1, 2000 through and including
March 31, 2000; (v) 2.50 to 1.00 for the period beginning April 1, 2000 through
and including June 30, 2000; and (vi) 2.75 to 1.00 thereafter.
SECTION 7.03 Senior Debt Leverage Ratio. The Company shall not permit
the Senior Debt Leverage Ratio as of the last day of any fiscal quarter to be
greater than 0.50 to 1.00.
SECTION 7.04 Minimum Net Worth. The Company shall at all times maintain
its Net Worth greater than the Minimum Net Worth, equal to (i) $45,000,000, plus
(ii) fifty percent (50%) of the cumulative Consolidated Net Income for each
fiscal quarter beginning after the fiscal quarter
58
ending on March 31, 1999 (specifically not including any Consolidated Net Loss
for any fiscal quarter), plus (iii) the cumulative net proceeds of all equity
offerings made by the Company after the Closing Date.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01 Events of Default. Any one or more of the following shall
constitute an Event of Default hereunder:
(a) The Company shall fail to pay any principal amount owing when due
pursuant to this Agreement or the Notes; or
(b) The Company shall fail to pay any interest, fees, or any other
amounts owing pursuant to this Agreement or the Notes within three (3) Business
Days of the due date thereof; or
(c) The Company shall fail to perform or observe any covenant or
agreement contained in Section 5.02 , Section 5.04 or Section 6.03, if remaining
unremedied for a period of ten (10) days after (x) an Executive Officer becomes
aware of such failure or (y) the Agent or any Lender gives notice to the Company
as provided under Section 10.03; or
(d) The Company shall fail to perform or observe any covenant or
agreement contained in Section 5.11, Article VI (other than Section 6.03) and
Article VII; or
(e) The Company shall fail to perform or observe any other covenant or
agreement set forth in this Agreement, other than those referred to in clauses
(a), (b), (c) and (d) above, and (to the extent such failure can be remedied)
such failure of performance shall not be remedied within thirty (30) days after
the earlier of the date on which (1) the Company obtains knowledge thereof and
(2) written notice thereof has been given by the Agent to the Company; or
(f) Any representation, warranty or statement made by or on behalf of
the Company or any Guarantor to the Agent or any Lender in this Agreement, the
Company Security Agreement, the Company Pledge Agreement, the Company Trademark
Security Agreement, the Guarantor Security Agreement, the Guarantor Pledge
Agreement, the Guarantor Trademark Security Agreement, the Mortgage and the
Assignment of Leases shall be in any respect incorrect, false or misleading as
of the time at which such representation or warranty was given, or any
representation, warranty or statement made by or on behalf of the Company or any
Guarantor to the Agent or any Lender in any other Loan Documents or in any
financial statement, report or certificate furnished pursuant to this Agreement
shall be in any material
59
respect incorrect, false or misleading as of the time at which such
representation, warranty or statement was made; or
(g) The Company or any of its Subsidiaries fails to make any payment as
and when such payment is due upon any Indebtedness having an aggregate unpaid
principal balance in excess of $250,000, other than Indebtedness owing or
arising pursuant to this Agreement and the Notes, or any other default, event or
condition shall have occurred or exist with respect to any such other
Indebtedness, or under any agreement or instrument evidencing, securing or
related to such other Indebtedness, the effect of which is to cause, or to
permit the holder or owner of such Indebtedness to cause, such Indebtedness or
any portion thereof, to become due prior to its stated maturity date or prior to
its regularly scheduled dates of payment; or
(h) The Company or any of its Subsidiaries defaults in the observance
or performance of any Material Contract; or
(i) The Company or any of its Subsidiaries makes an assignment for the
benefit of its creditors or files a voluntary petition seeking relief under any
provision of any bankruptcy, reorganization, arrangement, insolvency or
readjustment of debt, dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect; or
(j) Any involuntary petition is filed against the Company or any of
its Subsidiaries under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect, and such petition shall remain undismissed
for a period of sixty (60) days or the Company approves, consents or acquiesces
thereto; or
(k) The Company incurs any liability or is exposed to any potential
liability under any employee benefit plan that has or would have a Materially
Adverse Effect; or
(l) Final judgment for the payment of money in excess of $250,000 (not
fully covered by insurance) or otherwise having a Materially Adverse Effect
shall have been rendered against the Company or any of its Subsidiaries and the
same shall have remained unpaid, unstayed on appeal, undischarged, or
undismissed for a period of sixty (60) days, or such longer period as may be
permitted by Applicable Law, during which execution may not be made, provided no
judgment Lien has attached or continues to attach to the assets of the Company
or such Subsidiary during such longer period; or
(m) Any Change in Control occurs; or
(n) Xxxxxx X. Xxxxxxx shall cease to function as the Company's chief
executive officer or chairman of the board or shall cease to devote his full
time and attention thereto (other than due to his death or disability); or
60
(o) Any change occurs which has had or could reasonably be expected to
have a Materially Adverse Effect.
SECTION 8.02 Remedies on Default.
(a) Upon (i) the occurrence and during the continuation of an Event of
Default (other than an Event of Default described in Section 8.01(i) or (j)) and
(ii) the receipt of written instructions by the Agent from any Lender, the Agent
shall (x) terminate all obligations of the Lenders to the Company, including,
without limitation, the Commitments and all obligations to make Advances under
this Agreement, and (y) declare the Notes, including, without limitation,
principal, accrued interest and costs of collection (including, without
limitation, reasonable attorneys' fees if collected by or through an attorney at
law or in bankruptcy, receivership or other judicial proceedings) and all other
Obligations immediately due and payable, without presentment, demand, protest or
any other notice of any kind, all of which are expressly waived.
(b) Upon the occurrence of an Event of Default under Section 8.01(i) or
(j) all obligations of the Lenders to the Company, including, without
limitation, the Commitments, shall terminate automatically and the Notes,
including, without limitation, principal, accrued interest and costs of
collection (including, without limitation, reasonable attorneys' fees if
collected by or through an attorney at law or in bankruptcy, receivership or
other judicial proceedings) and all other Obligations shall be immediately due
and payable, without presentment, demand, protest, or any other notice of any
kind, all of which are expressly waived.
(c) Upon the occurrence of an Event of Default and acceleration of the
Notes as provided in (a) or (b) above, each of the Lenders and the Agent, or any
of them, may pursue any remedy available under this Agreement, the Notes, the
Security Documents or any other Loan Document, or available at law or in equity,
all of which shall be cumulative. The order and manner in which the rights and
remedies of the Lenders under the Loan Documents and otherwise may be exercised
shall be determined by the Required Lenders.
(d) Regardless of how each Lender may treat the payments for the
purpose of its own accounting, for the purpose of computing the Company's
obligations hereunder and under the Notes, no application of the payments will
cure any Event of Default or prevent acceleration, or continued acceleration, of
amounts payable under the Loan Documents or prevent the exercise, or continued
exercise, of rights or remedies of the Lenders hereunder or under applicable
law.
ARTICLE IX
THE AGENT
SECTION 9.01 Appointment and Authorization. Each Lender hereby
designates SunTrust as Agent to act as herein specified. Each Lender hereby
irrevocably
61
authorizes, and each holder of any Revolving Note or by the acceptance of a
Revolving Note shall be deemed irrevocably to authorize, the Agent to take such
action on its behalf under the provisions of this Agreement and the Revolving
Notes and any other instruments and agreements referred to herein and to
exercise such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of the Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. The Agent
may perform any of its duties hereunder by or through its agents or employees.
SECTION 9.02 Nature of Duties of the Agent. The Agent shall have no
duties or responsibilities to the other Lenders except those expressly set forth
in this Agreement. Neither the Agent nor any of its officers, directors,
employees or agents shall be liable for any action taken or omitted by it as
such hereunder or in connection herewith, unless caused by its or their gross
negligence or willful misconduct. The Agent shall not have by reason of this
Agreement a fiduciary relationship in respect of any Lender; and nothing in this
Agreement, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Agreement except as
expressly set forth herein. The Agent agrees to give each Lender prompt notice
of the Agent's receipt from the Company of any notice under this Agreement.
SECTION 9.03 Lack of Reliance on the Agent.
(a) Each Lender agrees that, independently and without reliance upon
the Agent, any other Lender, or the directors, officers, agents or employees of
the Agent or of any other Lender, each Lender, to the extent it deems
appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Company and its
Subsidiaries in connection with the taking or not taking of any action in
connection with this Agreement and the other Loan Documents, including the
decision to enter into this Agreement, and (ii) its own appraisal of the
creditworthiness of the Company and its Subsidiaries and, except as expressly
provided in this Agreement, the Agent shall have no duty or responsibility,
either initially or on a continuing basis, to provide any Lender with any credit
or other information with respect thereto, whether coming into its possession
before the making of any Advance or at any time or times thereafter.
(b) The Agent shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Agreement or any other Loan
Documents or the financial condition of the Company or its Subsidiaries or be
required to make any inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement or any other Loan
Documents, or the financial condition of the Company or its Subsidiaries, or the
existence or possible existence of any Default or Event of Default.
62
SECTION 9.04 Certain Rights of the Agent.
(a) If the Agent shall request instructions from the Required Lenders
with respect to any act or action (including the failure to act) in connection
with this Agreement or any other Loan Documents, the Agent shall be entitled to
refrain from such act or taking such action unless and until the Agent shall
have received instructions from the Required Lenders and the Agent shall not
incur liability to any Person by reason of so refraining. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against the Agent
as a result of the Agent acting or refraining from acting hereunder in
accordance with the instructions of the Required Lenders; provided, however,
that the Agent shall not be required to act or not act in accordance with any
instructions of the Required Lenders if to do so would expose the Agent to
personal liability or would be contrary to any Loan Document or to Applicable
Law.
(b) The Agent may assume that no Event of Default has occurred and is
continuing, unless the Agent has received notice from the Company stating the
nature of the Event of Default, or has received notice from a Lender stating the
nature of the Event of Default and that such Lender considers the Event of
Default to have occurred and to be continuing.
(c) If the Agent has notice, or has received notice, that an Event of
Default has occurred and is continuing, the Agent shall give notice thereof to
the Lenders and shall act or not act upon the instructions of the Required
Lenders, provided that the Agent shall not be required to act or not act if to
do so would expose the Agent to personal liability or would be contrary to any
Loan Document or to Applicable Law, and provided further, that if the Required
Lenders fail, for five days after the receipt of notice from the Agent, to
instruct the Agent, then the Agent, in its discretion, may act or not act as it
deems advisable for the protection of the interests of the Lenders and shall be
fully protected in so acting.
SECTION 9.05 Liability of the Agent. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
not taken by them under or in connection with the Loan Documents, except for
their own gross negligence or willful misconduct. Without limitation on the
foregoing, the Agent and its directors, officers, agents, and employees:
(a) may treat the payee of any Revolving Note as the holder thereof
until the Agent receives notice of the assignment or transfer thereof in form
satisfactory to the Agent, signed by the payee, and may treat each Lender as the
owner of that Lender's interest in the obligations due to such Lender for all
purposes of this Agreement and the other Loan Documents until the Agent receives
notice of the assignment or transfer thereof, in form satisfactory to the Agent,
signed by such Lender;
(b) may consult with outside legal counsel (including King & Spalding),
in-house legal counsel, independent public accountants, in-house accountants and
other professionals, or other experts selected by it with reasonable care, or
with legal counsel, independent public accountants, or other experts for the
Company, and shall not be liable for any
63
action taken or not taken by it or them in good faith in accordance with the
advice of such legal counsel, independent public accountants, or experts;
(c) will not be responsible to any Lender for any statement, warranty,
or representation made in any of the Loan Documents or in any notice,
certificate, report, request, or other statement (written or oral) in connection
with any of the Loan Documents;
(d) except to the extent expressly set forth in the Loan Documents,
will have no duty to ascertain or inquire as to the performance or observance by
the Company or any of its Subsidiaries or any other Person of any of the terms,
conditions, or covenants of any of the Loan Documents or to inspect the
property, books, or records of the Company or any of its Subsidiaries or other
Person;
(e) will not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, effectiveness, sufficiency, or
value of any Loan Document, any other instrument or writing furnished pursuant
thereto or in connection therewith;
(f) will not incur any liability by acting or not acting in reliance
upon any Loan Document, notice, consent, certificate, document, statement,
telex, telecopier message or other instrument or writing believed by it or them
to be genuine and to have been signed, sent or made by the proper Person; and
(g) will not incur any liability for any arithmetical error in
computing any amount payable to or receivable from any Lender hereunder,
including, without limitation, payment of principal and interest on the
Revolving Notes, Advances and other amounts; provided that promptly upon
discovery of such an error in computation, the Agent, the Lender and (to the
extent applicable) the Company shall make such adjustments as are necessary to
correct such error and to restore the parties to the position that they would
have occupied had the error not occurred.
SECTION 9.06 Indemnification. Each Lender shall, ratably in accordance
with the respective outstanding principal amount of its Advances, indemnify and
hold the Agent and its directors, officers, agents and employees harmless
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever (including, without limitation, attorneys' fees and
disbursements) that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of the Loan Documents (other than
losses incurred by reason of the failure by the Company to pay the obligations
due to the Lenders hereunder or under the Revolving Notes) or any action taken
or not taken by it as Agent thereunder, except for the gross negligence or
willful misconduct of the Agent. Without limitation of the foregoing, each
Lender shall reimburse the Agent upon demand for that Lender's ratable share of
any cost or expense incurred by the Agent in connection with the negotiation,
preparation, execution, delivery, administration, amendment, waiver,
refinancing, restructuring, reorganization (including a
64
bankruptcy reorganization) or enforcement of the Loan Documents, to the extent
that the Company is required to pay that cost or expense but fails to do so upon
demand.
SECTION 9.07 Agent and Affiliates. SunTrust (and each successor Agent)
has the same rights and powers under the Loan Documents as any other Lender and
may exercise the same as though it were not the Agent; and the term "the
Lenders" or "Lender" includes SunTrust in its individual capacity. SunTrust (and
each successor Agent) and its Affiliates may accept deposits from, lend money
to, and generally engage in any kind of banking, trust or other business with
the Company and any Affiliate of the Company, as if it were not the Agent and
without any duty to account therefor to the Lenders. SunTrust (and each
successor Agent) need not account to any other Lender for any monies received by
it for reimbursement of its costs, expenses and fees as the Agent hereunder, or
for any monies received by it in its capacity as a Lender hereunder, except as
otherwise provided herein. This Agreement shall not be deemed to constitute a
joint venture or partnership among the Lenders.
SECTION 9.08 Successor Agent. The Agent may resign as such at any time
by written notice to the Company and the Lenders, to be effective upon a
successor's acceptance of appointment as Agent. In such event, the Required
Lenders shall appoint a successor Agent or Agents who must be from among the
Lenders; provided that the Agent shall be entitled to appoint a successor Agent
from among the Lenders, subject to acceptance of appointment by that successor
Agent if the Required Lenders have not appointed a successor Agent within thirty
(30) calendar days after the date the Agent gave notice of resignation or was
removed; and provided further that if no such successor Agent is appointed from
among the Lenders, an Agent who is not a Lender may be appointed, which shall be
a bank organized under the laws of the United States of America or any State
thereof, or any affiliate of such bank, having a combined capital and surplus of
at least $500,000,000. Upon a successor's acceptance of appointment as Agent the
successor will thereupon succeed to and become vested with all the rights,
powers, privileges, and duties of the Agent under the Loan Documents, and the
resigning Agent will thereupon be discharged from its duties and obligations
thereafter arising under the Loan Documents.
ARTICLE X
MISCELLANEOUS
SECTION 10.01 Survival. All covenants, agreements, warranties and
representations made herein, in the other Loan Documents, or in any certificates
or other documents delivered in connection with this Agreement by or on behalf
of the Company or any Guarantor shall survive the advances of money made by the
Lenders to the Company hereunder and the delivery of this Agreement and the
other Loan Documents, and all such covenants, agreements, warranties and
representations shall be binding upon and inure to the benefit of the Company,
the Guarantors, the Lenders, the Agent, and their respective successors and
assigns,
65
whether or not so expressed, provided, however, that the Company may not assign
or transfer any of its rights under this Agreement without the prior written
consent of each of the Lenders.
SECTION 10.02 Amendments; Consents. No amendment, modification,
supplement, termination, or waiver of any provision of this Agreement or any
other Loan Document, and no consent to any departure by the Company, any
Guarantor or any Subsidiary of the Company therefrom, may in any event be
effective unless in writing signed by the Required Lenders, and then only in the
specific instance and for the specific purpose given; provided, however, that
without the approval in writing of all Lenders, no amendment, modification,
supplement, termination, waiver, or consent may be effective:
(a) to amend or modify the principal of, the rate of interest payable
on, or any fees with respect to, any Lender's Note, the Fees or the amount of
any Lender's Commitment;
(b) to postpone any date fixed for any payment of principal of, or any
installment of interest on, any Lender's Notes or the Fees, or to extend the
term "Commitments" of any Lender's Commitment;
(c) to amend or modify the definitions of "Borrowing Base", "Cost of
Products Sold", "EBITDA Multiple", "Gross Margin", "Gross Margin Factor",
"Revolving Loan Commitment" or "Required Lenders", to amend or modify Schedule
1.01, or the provisions of Section 10.07 or of this Section 10.02;
(d) to release any of the Collateral pledged to the Agent for the
benefit of, inter alia, the Agent or the Lenders pursuant to the Security
Documents to secure the Obligations, if any Obligations are outstanding or any
Commitment has not been terminated;
(e) to consent to the existence of any other lien, security interest or
encumbrance on the Collateral except as otherwise permitted herein;
(f) to subordinate any of the Obligations or the Commitments to any
other indebtedness of the Company or any of its Subsidiaries; and
(g) to release any Guarantor or to consent to the termination or
modification of any Guaranty Agreement.
Any amendment, modification, supplement, termination, waiver or consent effected
in accordance with this Section 10.02 shall apply equally to, and shall be
binding upon, all Lenders and the Agent.
SECTION 10.03 Notices. All notices, consents, demands and other
communications provided for hereunder, unless otherwise provided, shall be in
writing and mailed, sent by facsimile transmission or delivered to the parties
hereto addressed as follows or
66
at such other address as shall be designated by any party in a written notice to
the other party hereto:
If to the Company:
NuCo2 Inc.
0000 XX Xxxxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxxxx
Chief Financial Officer
Telecopier No.: (000) 000-0000
Confirmation No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
Confirmation No.: (000) 000-0000
If to the Agent:
SunTrust Bank, South Florida, National Association
000 X. Xxx Xxxx Xxxx.
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Attn: Corporate Banking Department
Telecopier No.: (000) 000-0000
Confirmation No.: (000) 000-0000
with a copy to:
King & Spalding
000 Xxxxxxxxx Xx.
Xxxxxxx, Xxxxxxx 00000
Attn: G. Xxxxxx Xxxxx, Esq.
Telecopier No.: 000-000-0000
Confirmation No.: 000-000-0000
67
If to a Lender:
The address, telecopier and confirmation numbers set forth opposite its
name on the signature pages hereof.
All notices that are sent by facsimile transmission or are hand
delivered shall be deemed to be delivered upon receipt. All notices which are
mailed shall be mailed first class certified mail--return receipt requested,
postage prepaid, and shall be deemed delivered upon actual receipt or three days
after being deposited in the mail, whichever shall occur first.
The parties hereto agree that their signatures by facsimile shall be
effective and binding upon them as though executed in ink on paper, and that the
parties shall exchange original ink signatures promptly following any such
delivery by facsimile.
SECTION 10.04 Severability; Time of Essence. Every provision of this
Agreement and the other Loan Documents are intended to be severable. If any term
or provision of this Agreement or the Loan Documents, or any other document
delivered in connection herewith shall be unenforceable in any respect, the
enforceability of the remaining provisions shall not thereby be affected. Time
is of the essence of this Agreement and the other Loan Documents.
SECTION 10.05 Governing Law; Submission to Jurisdiction.
(a) THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND ALL OTHER DOCUMENTS
CONTEMPLATED HEREBY, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
UNDER THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAW OF THE STATE OF FLORIDA (WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAW PRINCIPLES THEREOF).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF FLORIDA OR
OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF FLORIDA, AND, BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE COMPANY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE TRIAL BY JURY, AND
THE COMPANY HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.
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(c) Nothing herein shall affect the right of the Lenders and the Agent
to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Company in any other jurisdiction.
SECTION 10.06 Payment of Costs. The Company shall pay all reasonable
costs, expenses, taxes and fees incurred by the Agent in connection with the
negotiation, preparation, execution and delivery of this Agreement, the term
sheet and the Commitment Letter relating to this Agreement, the Security
Documents and all other Loan Documents, including, without limitation, all of
the reasonable professional fees and expenses of King & Spalding, special
counsel to the Agent, as set forth in the Commitment Letter.
SECTION 10.07 Indemnity. The Company agrees to protect, indemnify and
save harmless the Agent and each Lender, and all directors, officers, employees
and agents of the Agent and each Lender, from and against any and all (i)
claims, demands and causes of action of any nature whatsoever brought by any
person or entity not a party to this Agreement and arising from or related or
incident to this Agreement or any other Loan Document, (ii) costs and expenses
incident to the defense of such claims, demands and causes of action, including,
without limitation, reasonable attorneys' fees, and (iii) liabilities,
judgments, settlements, penalties and assessments arising from such claims,
demands and causes of action, provided such claims, costs and liabilities are
not the result of the gross negligence or willful misconduct of such Agent or
such Lender. The indemnity contained in this Section shall survive the
termination of this Agreement.
SECTION 10.08 Benefit of the Agreement.
(a) This 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 the Company may not assign or transfer any of its interest
hereunder without the prior written consent of the Lenders, and no such
assignment or transfer of any such obligations shall relieve the Company of its
obligations hereunder unless each Lender shall have consented to such release in
a writing specifically referring to the obligation from which the Company is to
be released.
(b) Any Lender may make, carry or transfer Advances at, to or for the
account of, any of its branch offices or the office of an Affiliate of such
Lender. Any Lender may at any time assign all or any portion of its rights in
this Agreement and the Revolving Notes issued to it to a Federal Reserve Bank;
provided that no such assignment shall release the Lender from any of its
obligations hereunder.
(c) Each Lender may assign or delegate all or a portion of its
interests, rights and obligations under this Agreement and the other Loan
Documents (including all or a portion of any of its Commitments and the Advances
at the time owing to it and the Revolving Notes held by it) to another financial
or lending institution or entity; provided, however, that (i) the Agent and the
Company must give their prior written consent to such assignment (which
69
consent, in the case of the Company, shall not be unreasonably withheld) unless
such assignment is to an Affiliate of the assigning Lender or, in the case of
the Company, unless an Event of Default has occurred and is continuing, (ii)
such assignment or delegation is complete or is in minimum increments of
$5,000,000, and (iii) the parties to each such assignment shall execute and
deliver to the Agent an Assignment Agreement, and, together with a Revolving
Note or Revolving Notes subject to such assignment and, unless such assignment
is to an Affiliate of such Lender, a processing and recordation fee of $3,000.
The Company shall not be responsible for such processing and recordation fee or
any costs or expenses incurred by any Lender (other than the Agent) in
connection with such assignment. From and after the effective date specified in
each Assignment Agreement, which effective date shall be at least five (5)
Business Days after the execution thereof, the assignee thereunder shall be a
party hereto and to the extent of the interest assigned by such Assignment
Agreement, have the rights and obligations of a Lender under this Agreement.
Within five (5) Business Days after receipt of the notice and the Assignment
Agreement, the Company, at its own expense, shall execute and deliver to the
Agent, in exchange for the surrendered Revolving Note or Revolving Notes, a new
Revolving Note or Revolving Notes to the order of such assignee in a principal
amount equal to the applicable Commitments assumed by it pursuant to such
Assignment and Acceptance and new Revolving Note or Revolving Notes to the
assigning Lender in the amount of its retained Commitment or Commitments. Such
new Revolving Note or Revolving Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Revolving Note or
Revolving Notes, shall be dated the date of the surrendered Revolving Note or
Revolving Notes which they replace, and shall otherwise be in substantially the
form attached hereto.
(d) Each Lender may from time to time sell or otherwise grant
participations in all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
Commitments and the Advances owing to it and the Revolving Notes held by it) to
another financial or lending institution or entity, whereupon the holder of any
such participation, if the participation agreement so provides, shall be
entitled to all of the rights of a Lender hereunder; provided, however, that (i)
the Agent must give its prior written consent to such participation unless such
participation is to an Affiliate of such Lender, (ii) such selling Lender's
obligations under this Agreement shall remain unchanged, (iii) such selling
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, and (iv) the Company, the Agent and other
Lenders shall continue to deal solely and directly with each Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents, and such Lender shall retain the sole right to enforce
the obligations of the Company relating to the Advances and to approve any
amendment, modification or waiver of any provisions of this Agreement or the
other Loan Documents. Any Lender selling a participation hereunder shall provide
prompt written notice to the Company of the name of such participant.
SECTION 10.09 Subordination of Indebtedness. Any Indebtedness of any
Guarantor now or hereafter owed to the Company is hereby subordinated in right
of payment to the payment by such Guarantor of its Guaranty Obligations such
that if a default in the payment
70
of the Obligations shall have occurred and be continuing, any such Indebtedness
of such Guarantor owed to the Company, if collected or received by the Company,
shall be held in trust by the Company for the holders of the Obligations and be
paid over to the Lenders and the Agent for application of such Guarantor's
Guaranty Obligations.
SECTION 10.10 Maximum Interest Rate. Nothing contained in this
Agreement or any Note shall require the Company to pay interest at a rate
exceeding the Maximum Permissible Rate. If interest payable to any Lender for
any period would exceed the Maximum Permissible Rate, such interest shall be
reduced automatically to the maximum amount that will not exceed the Maximum
Permissible Rate, and interest payable to any Lender for any subsequent period,
to the extent less than the Maximum Permissible Rate, shall, to that extent, be
increased by the aggregate amount of all such reductions.
SECTION 10.11 Entire Agreement. This Agreement and the other Loan
Documents executed and delivered contemporaneously herewith, together with the
exhibits and schedules attached hereto and thereto, constitute the entire
understanding of the parties with respect to the subject matter hereof, and any
other prior or contemporaneous agreements, whether written or oral, with respect
thereto, including, without limitation, the Commitment Letter, which is
expressly superseded hereby; provided, however, that the indemnities of the
Company in favor of the Lenders and SunTrust Equitable Securities Corporation
contained in the Commitment Letter shall survive the execution and delivery of
this Agreement. The execution of this Agreement and the other Loan Documents by
the Company was not based upon any facts or materials provided by the Agent or
any Lender, nor was the Company or any Guarantor induced to execute this
Agreement or any other Loan Document by any representation, statement or
analysis made by the Agent or any Lender.
SECTION 10.12 Set-Off. Upon the occurrence and during the continuance
of any Event of Default, each Lender, and each of its branches and offices, is
hereby authorized by the Company, at any time and from time to time, without
notice to the Company (i) to set off against, and to appropriate and apply to
the payment of the Obligations (in each case whether matured or unmatured) any
and all amounts owing by such Lender, or any such office or branch, to the
Company (whether payable in Dollars or any other currency, whether matured or
unmatured, and, in the case of deposits, whether general or special, time or
demand and however evidenced) and (ii) pending any such action, to the extent
necessary, to hold such amounts as collateral to secure such Obligations and
Guaranty Obligations and to return as unpaid for insufficient funds any and all
checks and other items drawn against any deposits so held as such Lender in its
sole discretion may elect. Each Lender shall give the Company notice of its
intention to exercise its rights under this Section 10.12; provided, however,
that failure by such Lender to give the Company notice shall not prevent such
Lender from exercising its rights as provided in this Section. The Company, to
the fullest extent it may effectively do so under Applicable Law, agrees that
any holder of a participation in any Advance may exercise rights of set-off and
counterclaim and other rights with respect to such participation as fully as if
such holder of a participation were a direct creditor of the Company in the
amount of such participation.
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SECTION 10.13 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and all
of which, taken together, shall constitute one and the same instrument.
SECTION 10.14 Replacement Notes. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Note, and in the case of any such loss, theft or destruction, upon delivery of
any indemnity agreement reasonably satisfactory to the Company or, in the case
of any such mutilation, upon surrender and cancellation of such Note, the
Company shall execute and deliver, in lieu thereof, a replacement note identical
in form and substance to such Note and dated as of the date of such Note, and
upon such execution and delivery of the replacement note all references in this
Agreement and in all other Loan Documents to the Note shall be deemed to refer
to such replacement note.
SECTION 10.15 Release. In consideration of the Agent's and the Lenders'
agreement to enter into this Agreement and to establish the Commitments
hereunder, the Company hereby (a) releases, acquits and forever discharges the
Agent and the Lenders, their respective agents, employees, officers, directors,
servants, representatives, attorneys, affiliates, successors and assigns
(collectively, the "Released Parties") from any and all liabilities, claims,
suits, debts, liens, losses, causes of action, demands, rights, damages, costs
and expenses of any kind, character or nature whatsoever, known or unknown,
fixed or contingent, that the Company may have or claim to have against the
Agent and the Lenders which might arise out of or be connected with any act of
commission or omission of the Agent or the Lenders existing or occurring on or
prior to the date of this Agreement, including, without limitation, any claims,
liabilities or obligations relating to or arising out of or in connection with
the Loan Documents (including, without limitation, arising out of or in
connection with the initiation, negotiation, closing or administration of the
transactions contemplated thereby or related thereto), from the beginning of
time until the execution and delivery of this Agreement (the "Released Claims")
and (b) agrees forever to refrain from commencing, instituting or prosecuting
any lawsuit, action or other proceeding against the Released Parties with
respect to any and all Released Claims.
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WITNESS the hand and seal of the parties hereto through their duly
authorized officers, as of the date first above written.
NUCO2 INC.,
a Florida corporation
Address: By: /s/ Xxxxx Xxxxxxxx
c/o NuCo2 Inc. -----------------------------
2800 S.E. Market Place Xxxxx Xxxxxxxx
Xxxxxx, Xxxxxxx 00000 Chief Financial Officer
and Treasurer
Attest: /s/ Xxxx X. Xxxxxxxx
--------------------
Xxxx X. Xxxxxxxx
General Counsel and
Secretary
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
SUNTRUST BANK, SOUTH FLORIDA,
NATIONAL ASSOCIATION,
By: /s/ Xxxxxxx X. Xxxxxxxx
----------------------------------
Xxxxxxx X. Xxxxxxxx
Vice President
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.,
individually and as Documentation Agent
By: /s/ Xxxxx Xxxx
------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Associate
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
BANK-LEUMI LE-ISRAEL B.M.,
MIAMI AGENCY
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
THE PROVIDENT BANK
By: /s/ Nick Jeviz
-----------------------------------
Name: Nick Jeviz
Title: Vice President
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
