CREDIT AGREEMENT
Dated as of October 24, 2001
among
CONSOLIDATED FREIGHTWAYS CORPORATION
as Borrower,
THE OTHER CREDIT PARTIES SIGNATORY HERETO,
as Credit Parties,
and
GENERAL ELECTRIC CAPITAL CORPORATION,
as Lender
INDEX OF APPENDICES
Annex A (Recitals) - Definitions
Annex B (Section 2.1(a)) - Closing Checklist
Annex C (Section 4.1(a)) - Financial Statements and
Projections -- Reporting
Annex D (Section 6.10) - Financial Covenants
Annex E (Section 11.10) - Notice Addresses
Annex F - List of Mortgaged Properties
Annex G (Section 2.5) - Conditions Precedent for Partial
Release of Mortgaged Properties
Exhibit 1.1(a)(i) - Form of Notice of Revolving Credit
Advance
Exhibit 1.1(a)(ii) - Form of Revolving Note
Exhibit 1.3(a) - Form of Disbursement Direction Letter
Exhibit 4.1(b) - Form of Borrowing Base Certificate
Schedule 1.1 - Lender's Representatives
Disclosure Schedule 3.2 - Executive Offices; Collateral Locations; FEIN
Disclosure Schedule 3.5 - Material Adverse Effect
Disclosure Schedule 3.7 - Labor Matters
Disclosure Schedule 3.8 - Ventures, Subsidiaries and
Affiliates; Outstanding Stock
Disclosure Schedule 3.11 - Tax Matters
Disclosure Schedule 3.12 - ERISA Plans
Disclosure Schedule 3.13 - Litigation
Disclosure Schedule 3.15 - Intellectual Property
Disclosure Schedule 3.17 - Hazardous Materials
Disclosure Schedule 3.18 Insurance
Disclosure Schedule 6.2 - Investments
Disclosure Schedule 6.3 - Indebtedness
Disclosure Schedule 6.6 - Existing Guarantees
Disclosure Schedule 6.7 - Existing Liens
This CREDIT AGREEMENT (this "Agreement"), dated as of
October 24, 2001 among CONSOLIDATED FREIGHTWAYS CORPORATION, a
Delaware corporation ("Borrower"); the other Credit Parties
signatory hereto; and GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation (in its individual capacity, "GE Capital"),
as Lender.
RECITALS
WHEREAS, Borrower has requested that Lender extend
revolving credit facilities to Borrower of up to Fifty Million
Dollars ($50,000,000) in the aggregate for the purpose of
providing (a) working capital financing for Borrower, and (b)
funds for other general corporate purposes of Borrower; and for
these purposes, Lender is willing to make certain loans and other
extensions of credit to Borrower of up to such amount upon the
terms and conditions set forth herein; and
WHEREAS, the Credit Parties have agreed to secure all
of their obligations under the Loan Documents, the Letter of
Credit Documents and the Other Credit Documents by granting to
Lender a first priority mortgage and security interest in and
lien upon certain of their Real Property; and
WHEREAS, capitalized terms used in this Agreement shall
have the meanings ascribed to them in Annex A to this Agreement,
and, for purposes of this Agreement and the other Loan Documents,
the rules of construction set forth in Annex A to this Agreement
shall govern. All Annexes, Disclosure Schedules, Exhibits and
other attachments (collectively, "Appendices") hereto, or
expressly identified to this Agreement, are incorporated herein
by reference, and taken together with this Agreement, shall
constitute but a single agreement. These Recitals shall be
construed as part of the Agreement.
NOW, THEREFORE, in consideration of the premises and
the mutual covenants hereinafter contained, and for other good
and valuable consideration, the parties hereto agree as follows:
1. AMOUNT AND TERMS OF CREDIT
1.1 Credit Facilities.
(a) Revolving Credit Facility. Subject to the terms and
conditions hereof, Lender agrees to make available to Borrower
from time to time until the Commitment Termination Date advances
(each, a "Revolving Credit Advance"). Until the Commitment
Termination Date, Borrower may borrow, repay and reborrow under
this Section 1.1(a); provided that the amount of any Revolving
Credit Advance to be made at any time shall not exceed Borrowing
Availability at such time. Borrowing Availability may be reduced
by Reserves imposed by Lender in its reasonable credit judgment.
Each Revolving Credit Advance shall be made on notice by Borrower
to one of the representatives of Lender identified in Schedule
1.1 at the address specified therein. Any such notice must be
given no later than 12:00 noon (New York time) on the Business
Day of the proposed Revolving Credit Advance. Each such notice
(a "Notice of Revolving Credit Advance") must be given in writing
(by telecopy or overnight courier) substantially in the form of
Exhibit 1.1(a)(i).
(b) Borrower shall execute and deliver to Lender a note to
evidence the Revolving Loan Advances. Such note shall be dated
the Closing Date and substantially in the form of Exhibit
1.1(a)(ii) (the "Revolving Note"). The Revolving Note shall
represent the obligation of Borrower to pay the aggregate unpaid
principal amount of all Revolving Credit Advances made to
Borrower together with interest thereon as prescribed in Section
1.4. The entire unpaid balance of the Revolving Loan and all
other non-contingent Obligations arising under this Agreement and
the other Loan Documents shall be immediately due and payable in
full in immediately available funds on the Commitment Termination
Date.
(c) Reliance on Notices. Lender shall be entitled to rely upon,
and shall be fully protected in relying upon, any Notice of
Revolving Credit Advance or similar notice believed by Lender to
be genuine. Lender may assume that each Person executing and
delivering such a notice was duly authorized, unless the
responsible individual acting thereon for Lender has actual
knowledge to the contrary.
1.2 Prepayment.
(a) Voluntary Prepayments; Termination of Revolving Loan
Commitment . Subject to the terms and conditions of this
Agreement, until the Commitment Termination Date, Borrower may
from time to time repay and reborrow Revolving Credit Advances
without any prepayment fee or premium. Borrower may at any time
on at least 5 days' prior written notice to Lender terminate the
Revolving Loan Commitment; provided that upon such termination
all Loans and other Obligations arising under this Agreement and
the other Loan Documents shall be immediately due and payable in
full. Upon any such prepayment and termination of the Revolving
Loan Commitment, Borrower's rights to request Revolving Credit
Advances shall simultaneously be terminated.
(b) Mandatory Prepayments.
(i) If at any time the outstanding balance of the Revolving Loan
exceeds the lesser of (A) the Revolving Loan Commitment and (B)
the Borrowing Base, Borrower shall immediately repay the
aggregate outstanding Revolving Credit Advances to the extent
required to eliminate such excess.
(ii) Immediately upon receipt by any Credit Party or any Foreign
or Domestic Subsidiary of any Credit Party of (i) the proceeds of
any Asset Disposition by such Credit Party or such Subsidiary
(excluding proceeds received by CF Delaware from any sales of
accounts receivables and related rights made prior to an
Incipient Termination Event or a Termination Event by CF Delaware
to the Receivables Subsidiary pursuant to the Receivables Sale
and Contribution Agreement) other than the proceeds from any
single Asset Disposition not in excess of $100,000, or (ii) the
proceeds of any sale of Stock of any Credit Party or any Foreign
or Domestic Subsidiary of any Credit Party, Borrower shall prepay
the Loans in an amount equal to all such proceeds, net of (A)
commissions and other reasonable and customary transaction costs,
fees and expenses properly attributable to such transaction and
payable by Borrower in connection therewith (in each case, paid
to non-Affiliates), (B) transfer taxes, (C) amounts payable to
holders of senior Liens (to the extent such Liens constitute
Permitted Encumbrances hereunder), if any, and (D) an appropriate
reserve for income taxes in accordance with GAAP in connection
therewith. Any such prepayment shall be applied in accordance
with Section 1.2(c) below.
(iii) If any Credit Party or any Foreign or Domestic
Subsidiary of any Credit Party (i) issues any Stock or debt
securities, or (ii) incurs any Funded Debt, no later than the
Business Day following the date of receipt of the proceeds
thereof, Borrower shall prepay the Loans in an amount equal to
all such proceeds, net of underwriting discounts and commissions
and other reasonable costs paid to non-Affiliates in connection
therewith. Any such prepayment shall be applied in accordance
with Section 1.2(c) below.
(c) Application of Certain Mandatory Prepayments. Any
prepayments made by Borrower pursuant to Sections 1.2(b)(ii) or
(b)(iii) above shall be applied as follows: first, to Fees and
reimbursable expenses of Lender then due and payable pursuant to
any of the Loan Documents; second, to interest then due and
payable on the Loans; third, to the outstanding principal balance
of the Revolving Loan; and fourth, to all other outstanding
Obligations in such order as the Lender deems advisable. The
Revolving Loan Commitment shall be permanently reduced by the
amount of any such prepayments.
(d) Application of Prepayments from Insurance and Condemnation
Proceeds. Prepayments from insurance or condemnation proceeds
relating to the Collateral in accordance with Section 5.4 and the
Mortgages, respectively, shall be applied as follows: insurance
or condemnation proceeds from casualties or losses to any
Collateral shall be applied (i) first, to the outstanding
principal balance of the Revolving Loan, and (ii) second, to the
extent no Loans remain outstanding after giving effect to the
prepayment required in clause (i) of this Section 1.2(d), to the
repayment of all other Obligations (and in such order) as Lender
may deem advisable. The Revolving Loan Commitment shall be
permanently reduced by the amount of any such prepayments.
(e) Nothing in this Section 1.2 shall be construed to constitute
Lender's consent to any transaction that is prohibited by other
provisions of this Agreement or the other Loan Documents.
1.3 Use of Proceeds.
(a) Borrower shall utilize the proceeds of the initial Revolving
Credit Advances made on the Closing Date to make a capital
contribution to the Receivables Subsidiary in the amount of
$15,000,000 (the "Initial Capital Contribution"). Borrower shall
cause the Receivables Subsidiary on the Closing Date to apply the
entire amount of the Initial Capital Contribution to the
repayment of outstanding Receivables Advances in the aggregate
principal amount of $15,000,000 to create additional availability
under the Receivables Funding Agreement. Borrower shall utilize
the proceeds of the Revolving Credit Advances made after the
Closing Date, but prior to the Post-Closing Borrowing Date, and
satisfying the conditions of Section 2.2, solely to make an
additional capital contributions to the Receivables Subsidiary in
the aggregate amount of $10,000,000 (the "Subsequent Capital
Contribution"). Borrower shall cause the Receivables Subsidiary
after the Closing Date, but prior to the Post-Closing Borrowing
Date, to apply the entire amount of the Subsequent Capital
Contribution to the repayment of outstanding Receivables Advances
in the aggregate principal amount of $10,000,000 in order to
enable the Receivables Subsidiary to avoid a Funding Excess after
giving effect to the Payroll Reserve (as such terms are defined
in Annex X to the Receivables Funding Agreement) . The initial
Revolving Credit Advances made on the Closing Date and the
initial Revolving Credit Advances made after the Closing Date,
but prior to the Post-Closing Borrowing Date, shall be disbursed
by the Lender solely in accordance with the disbursement
direction letter in the form of Exhibit 1.3(a) attached hereto
(the "Disbursement Direction Letter").
(b) Borrower shall utilize the proceeds of the Revolving Credit
Advances made after the Closing Date (other than the Revolving
Credit Advances required to be used to make the Subsequent
Capital Contribution pursuant to Section 1.3(a) hereof, solely
for the financing of ordinary working capital and general
corporate needs of the Borrower and its Subsidiaries).
1.4 Interest and Applicable Margins.
(a) Borrower shall pay interest to Lender in arrears on each
applicable Interest Payment Date at the Adjusted Monthly LIBOR
Index Rate plus the Applicable Revolver LIBOR Margin per annum,
based on the aggregate principal amount of Loans outstanding from
time to time; provided that if at any time the Adjusted Monthly
LIBOR Index Rate is not capable of determination by Lender for
any LIBOR Period as a result of the failure of the LIBOR Rate for
any reason to be available (or if the introduction of or any
change in any law or regulation (or any change in the
interpretation thereof) shall make it unlawful, or any central
bank or other Governmental Authority shall assert that it is
unlawful, for Lender to agree to make or to make or to continue
to fund or maintain any LIBOR Loan) then, until such time as the
LIBOR Rate then becomes available and the Adjusted Monthly LIBOR
Index Rate is capable of determination by Lender or the funding
or maintaining of LIBOR Loans becomes lawful, as the case may be,
Borrower shall pay interest to Lender in arrears during such
LIBOR Period and at all times thereafter on each applicable
Interest Payment Date at the Index Rate plus the Applicable
Revolver Index Margin.
(b) If any payment on any Loan becomes due and payable on a day
other than a Business Day, the maturity thereof will be extended
to the next succeeding Business Day (except as set forth in the
definition of LIBOR Period) and, with respect to payments of
principal, interest thereon shall be payable at the then
applicable rate during such extension.
(c) All computations of Fees calculated on a per annum basis and
interest shall be made by Lender on the basis of a 360-day year,
in each case for the actual number of days occurring in the
period for which such interest and Fees are payable. The Index
Rate is a floating rate determined for each day. Each
determination by Lender of an interest rate hereunder shall be
final, binding and conclusive on Borrower, absent manifest error.
(d) So long as an Event of Default under Sections 8.1(a), (h) or
(i) has occurred and is continuing or so long as, at the election
of Lender after written notice from Lender to Borrower, any other
Default or Event of Default has occurred and is continuing, the
interest rates applicable to the Loans shall be increased by two
percentage points (2%) per annum above the rates of interest
otherwise applicable hereunder ("Default Rate"), and all
outstanding Obligations arising under this Agreement and the
other Loan Documents shall bear interest at the Default Rate
applicable to such Obligations. Interest at the Default Rate
shall accrue from the initial date of such Default or Event of
Default until that Default or Event of Default is cured or waived
and shall be payable upon demand.
(e) Notwithstanding anything to the contrary set forth in this
Section 1.4, if a court of competent jurisdiction determines in a
final order that the rate of interest payable hereunder exceeds
the highest rate of interest permissible under law (the "Maximum
Lawful Rate"), then so long as the Maximum Lawful Rate would be
so exceeded, the rate of interest payable hereunder shall be
equal to the Maximum Lawful Rate; provided, however, that if at
any time thereafter the rate of interest payable hereunder is
less than the Maximum Lawful Rate, Borrower shall continue to pay
interest hereunder at the Maximum Lawful Rate until such time as
the total interest received by Lender is equal to the total
interest that would have been received had the interest rate
payable hereunder been (but for the operation of this paragraph)
the interest rate payable since the Closing Date as otherwise
provided in this Agreement. Thereafter, interest hereunder shall
be paid at the rate(s) of interest and in the manner provided in
Sections 1.4(a) through (d), unless and until the rate of
interest again exceeds the Maximum Lawful Rate, and at that time
this paragraph shall again apply. In no event shall the total
interest received by Lender pursuant to the terms hereof exceed
the amount that Lender could lawfully have received had the
interest due hereunder been calculated for the full term hereof
at the Maximum Lawful Rate. If the Maximum Lawful Rate is
calculated pursuant to this paragraph, such interest shall be
calculated at a daily rate equal to the Maximum Lawful Rate
divided by the number of days in the year in which such
calculation is made. If, notwithstanding the provisions of this
Section 1.4(e), a court of competent jurisdiction shall finally
determine that Lender has received interest hereunder in excess
of the Maximum Lawful Rate, Lender shall, to the extent permitted
by applicable law, promptly apply such excess in the order
specified in Section 1.7 and thereafter shall refund any excess
to Borrower or as a court of competent jurisdiction may otherwise
order.
1.5 Fees.
(a) Borrower shall pay to Lender on the Closing Date a closing
fee in the amount as specified in the Fee Letter, which fee shall
be fully earned and non-refundable when paid. Borrower shall pay
to Lender the additional fees at the times and in the manner
specified in the Fee Letter.
(b) As additional compensation for Lender's Revolving Loan
Commitment, Borrower shall pay to Lender, in arrears, on the
first Business Day of each month prior to the Commitment
Termination Date and on the Commitment Termination Date, a Fee
for Borrower's non-use of available funds (the "Unused Line Fee")
in an amount equal to the Applicable Unused Line Fee Margin per
annum (calculated on the basis of a 360 day year for actual days
elapsed) multiplied by the difference between (x) the Revolving
Loan Commitment (as it may be reduced from time to time) and (y)
the average for the period of the daily closing balance of the
Revolving Loan outstanding during the period for which such Fee
is due, provided, however, that in calculating the Unused Line
Fee, the Revolving Loan Commitment as used in this Section 1.5(b)
shall be deemed to be $25,000,000 until such time as the
aggregate principal amount of all outstanding Revolving Loans
exceeds $25,000,000 and, at all times thereafter, the Revolving
Loan Commitment for purposes of this Section 1.5(b) shall be the
full amount of the Revolving Loan Commitment as such term is
defined in Annex A.
1.6 Receipt of Payments. Borrower shall make each payment under
this Agreement not later than 2:00 p.m. New York time on the day
when due in immediately available funds in Dollars to the GE
Collection Account. For purposes of computing interest and Fees
and determining Borrowing Availability as of any date, all
payments shall be deemed received on the first Business Day
following the Business Day on which immediately available funds
therefor are received in the GE Collection Account prior to 2:00
p.m. New York time. Payments received after 2:00 p.m. New York
time on any Business Day or on a day that is not a Business Day
shall be deemed to have been received on the following Business
Day.
1.7 Application and Allocation of Payments.
(a) So long as no Default or Event of Default has occurred and
is continuing, (i) payments matching specific scheduled payments
then due shall be applied to those scheduled payments; (ii)
voluntary prepayments shall be applied as determined by Borrower,
subject to the provisions of Section 1.2(a); and (iii) mandatory
prepayments shall be applied as set forth in Sections 1.2(c) and
(d). As to any other payment, and as to all payments made when a
Default or Event of Default has occurred and is continuing or
following the Commitment Termination Date, Borrower hereby
irrevocably waives the right to direct the application of any and
all payments received from or on behalf of Borrower, and Borrower
hereby irrevocably agrees that Lender shall have the continuing
exclusive right to apply any and all such payments against the
Obligations as Lender may deem advisable notwithstanding any
previous entry by Lender in the Loan Account or any other books
and records. In the absence of a specific determination by
Lender with respect thereto, payments shall be applied to amounts
then due and payable in the following order: (1) to Fees and
Lender's expenses reimbursable hereunder; (2) to interest on the
Loans, ratably in proportion to the interest accrued as to each
Loan; (3) to the outstanding principal balance of the Revolving
Loan; (4) to all other Obligations (other than Letter of Credit
Obligations and Other Secured Obligations) to the extent
reimbursable under Section 11.3 in such order as the Lender may
deem advisable; (5) to all Letter of Credit Obligations; and (6)
to all Other Secured Obligations in such order as the Lender may
deem advisable. In the event of any conflict between this
Section 1.7(a) and Section 1.7(a) of the Letter of Credit
Agreement, this Section 1.7(a) shall control for purposes of
determining application and allocation of any payments received
by the Lender hereunder.
(b) Lender is authorized to, and at its sole election may,
charge to the Revolving Loan balance on behalf of Borrower and
cause to be paid all Fees, expenses, Charges, costs (including
insurance premiums in accordance with Section 5.4(a)) and
interest owing by Borrower under this Agreement or any of the
other Loan Documents if and to the extent Borrower fails to pay
promptly any such amounts as and when due, even if the amount of
such charges would exceed Borrowing Availability at such time.
At Lender's option and to the extent permitted by law, any
charges so made shall constitute part of the Revolving Loan
hereunder.
1.8 Loan Account and Accounting. Lender shall maintain a loan
account (the "Loan Account") on its books to record: all
Revolving Credit Advances, all payments made by Borrower, and
all other debits and credits as provided in this Agreement with
respect to the Loans or any other Obligations. All entries in
the Loan Account shall be made in accordance with Lender's
customary accounting practices as in effect from time to time.
The balance in the Loan Account, as recorded on Lender's most
recent printout or other written statement, shall, absent
manifest error, be presumptive evidence of the amounts due and
owing to Lender by Borrower; provided that any failure to so
record or any error in so recording shall not limit or otherwise
affect Borrower's duty to pay the Obligations. Lender shall
render to Borrower a monthly accounting of transactions with
respect to the Loans setting forth the balance of the Loan
Account for the immediately preceding month. Unless Borrower
notifies Lender in writing of any objection to any such
accounting (specifically describing the basis for such
objection), within 30 days after the date thereof, each and every
such accounting shall (absent manifest error) be deemed final,
binding and conclusive on Borrower in all respects as to all
matters reflected therein. Only those items expressly objected
to in such notice shall be deemed to be disputed by Borrower.
1.9 Indemnity.
(a) Each Credit Party that is a signatory hereto shall jointly
and severally indemnify and hold harmless each of Lender and its
Affiliates, and each such Person's respective officers,
directors, employees, attorneys, agents and representatives
(each, an "Indemnified Person"), from and against any and all
suits, actions, proceedings, claims, damages, losses, liabilities
and expenses (including reasonable attorneys' fees and
disbursements and other costs of investigation or defense,
including those incurred upon any appeal) which may be instituted
or asserted against or incurred by any such Indemnified Person as
the result of credit having been extended, suspended or
terminated under this Agreement and the other Loan Documents and
the administration of such credit, and in connection with or
arising out of the transactions contemplated hereunder and
thereunder and any actions or failures to act in connection
therewith, including any and all Environmental Liabilities and
legal costs and expenses arising out of or incurred in connection
with disputes between or among any parties to any of the Loan
Documents (collectively, "Indemnified Liabilities"); provided,
that no such Credit Party shall be liable for any indemnification
to an Indemnified Person to the extent that any such suit,
action, proceeding, claim, damage, loss, liability or expense
results from that Indemnified Person's gross negligence or
willful misconduct. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE
OR LIABLE TO ANY OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR,
ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH PERSON OR ANY OTHER
PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR
INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY
BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED
OR TERMINATED UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER
TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER.
1.10 Access. Borrower shall, during normal business hours,
subject to Borrower's reasonable and customary safety, security
and confidentiality policies and regulations, from time to time
upon one (1) Business Day's prior notice: (a) provide Lender and
any of its officers, employees and agents access to the
properties, facilities, advisors and employees (including
officers) of each Credit Party and to the Collateral, (b) permit
Lender, and any of its officers, employees and agents, to
inspect, audit and make extracts from any Credit Party's books
and records, and (c) permit Lender, and its officers, employees
and agents, to inspect, review and evaluate the Collateral of any
Credit Party and to perform collateral appraisals and
environmental reviews at Lender's discretion. Borrower and the
Credit Parties shall be liable for all costs and expenses
relating to any and all of the foregoing inspections, appraisals,
evaluations or reviews conducted by Lender or any of its
officers, employees and agents irrespective of whether or not any
Default or Event of Default exists at the time of any such
inspection, appraisal, evaluation or review. If a Default or
Event of Default shall have occurred and be continuing or if
access is necessary to preserve or protect the Collateral as
determined by Lender, Borrower shall cause each such Credit Party
to provide such access at all times and without advance notice.
Furthermore, so long as any Event of Default shall have occurred
and be continuing, Borrower shall provide Lender with access to
the suppliers and customers of each Credit Party. Borrower shall
cause each Credit Party to make available to Lender and its
counsel, as quickly as is possible under the circumstances,
originals or copies of all books and records which Lender may
request. Borrower shall cause each Credit Party to deliver any
document or instrument necessary for Lender, as it may from time
to time request, to obtain records from any service bureau or
other Person which maintains records for such Credit Party, and
shall maintain duplicate records or supporting documentation on
media, including computer tapes and discs owned by such Credit
Party.
1.11 Taxes.
(a) Any and all payments by Borrower hereunder or under the Note
shall be made, in accordance with this Section 1.11, free and
clear of and without deduction for any and all present or future
Taxes. If Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder or under the
Note, (i) the sum payable shall be increased as much as shall be
necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this
Section 1.11) Lender receives an amount equal to the sum it would
have received had no such deductions been made, (ii) Borrower
shall make such deductions, and (iii) Borrower shall pay the full
amount deducted to the relevant taxing or other authority in
accordance with applicable law. Within 30 days after the date of
any payment of Taxes, Borrower shall furnish to Lender the
original or a certified copy of a receipt evidencing payment
thereof. Lender shall not be obligated to return or refund any
amounts received pursuant to this Section.
(b) Each Credit Party that is a signatory hereto shall indemnify
and, within 10 days of demand therefor, pay Lender for the full
amount of Taxes (including any Taxes imposed by any jurisdiction
on amounts payable under this Section 1.11) paid by Lender, and
any liability (including penalties, interest and expenses)
arising therefrom or with respect thereto, whether or not such
Taxes were correctly or legally asserted.
1.12 Capital Adequacy; Increased Costs; Illegality.
(a) If Lender shall have determined that the adoption after the
date hereof of any law, treaty, governmental (or
quasi-governmental) rule, regulation, guideline or order
regarding capital adequacy, reserve requirements or similar
requirements or compliance by Lender with any request or
directive regarding capital adequacy, reserve requirements or
similar requirements (whether or not having the force of law), in
each case adopted after the Closing Date, from any central bank
or other Governmental Authority increases or would have the
effect of increasing the amount of capital, reserves or other
funds required to be maintained by Lender and thereby reducing
the rate of return on Lender's capital as a consequence of its
obligations hereunder, then Borrower shall from time to time upon
demand by Lender pay to Lender additional amounts sufficient to
compensate Lender for such reduction. A certificate as to the
amount of that reduction and showing the basis of the computation
thereof submitted by Lender to Borrower shall, absent manifest
error, be final, conclusive and binding for all purposes.
(b) If, due to either (i) the introduction of or any change in
any law or regulation (or any change in the interpretation
thereof) or (ii) the compliance with any guideline or request
from any central bank or other Governmental Authority (whether or
not having the force of law), in each case adopted after the
Closing Date, there shall be any increase in the cost to Lender
of agreeing to make or making, funding or maintaining any Loan,
then Borrower shall from time to time, upon demand by Lender, pay
to Lender additional amounts sufficient to compensate Lender for
such increased cost. A certificate as to the amount of such
increased cost, submitted to Borrower by Lender, shall be
conclusive and binding on Borrower for all purposes, absent
manifest error. Lender agrees that, as promptly as practicable
after it becomes aware of any circumstances referred to above
which would result in any such increased cost, Lender shall, to
the extent not inconsistent with Lender's internal policies of
general application, use reasonable commercial efforts to
minimize costs and expenses incurred by it and payable to it by
Borrower pursuant to this Section 1.12(b).
(c) Notwithstanding anything to the contrary contained herein,
if the introduction of or any change in any law or regulation (or
any change in the interpretation thereof) shall make it unlawful,
or any central bank or other Governmental Authority shall assert
that it is unlawful, for Lender to agree to make or to make or to
continue to fund or maintain any LIBOR Loan, then, unless Lender
is able to make or to continue to fund or to maintain such LIBOR
Loan at another branch or office of Lender without, in Lender's
opinion, adversely affecting it or its Loans or the income
obtained therefrom, on notice thereof and demand therefor by
Lender to Borrower (i) the obligation of Lender to agree to make
or to make or to continue to fund or maintain LIBOR Loans shall
terminate and (ii) Borrower shall forthwith prepay in full all
outstanding LIBOR Loans owing to Lender, together with interest
accrued thereon, unless Borrower, within 5 Business Days after
the delivery of such notice and demand, converts all LIBOR Loans
into Index Rate Loans.
1.13 Single Loan. All Loans to Borrower and all of the other
Obligations of Borrower arising under this Agreement and the
other Loan Documents shall constitute one general obligation of
Borrower secured, until the Termination Date, by all of the
Collateral.
2. CONDITIONS PRECEDENT
2.1 Conditions to the Initial Loans to be made on the Closing
Date. Lender shall not be obligated to make any Loan on the
Closing Date, or to take, fulfill, or perform any other action
hereunder, until the following conditions have been satisfied or
provided for in a manner satisfactory to Lender, in Lender's sole
discretion, or waived in writing by Lender:
(a) Credit Agreement; Loan Documents. This Agreement or
counterparts hereof shall have been duly executed by, and
delivered to, Borrower, each other Credit Party and Lender; and
Lender shall have received such documents, instruments,
agreements and legal opinions as Lender shall reasonably request
in connection with the transactions contemplated by this
Agreement and the other Loan Documents (but excluding Loan
Documents relating solely to the Second Group of Mortgaged
Properties and the Third Group of Mortgaged Properties),
including all those listed in the Closing Checklist, each in form
and substance satisfactory to Lender.
(b) Approvals. Lender shall have received (i) satisfactory
evidence that the Credit Parties have obtained all required
consents and approvals of all Persons including all requisite
Governmental Authorities, to the execution, delivery and
performance of this Agreement and the other Loan Documents (but
excluding Loan Documents relating solely to the Second Group of
Mortgaged Properties and the Third Group of Mortgaged Properties)
or (ii) an officer's certificate in form and substance
satisfactory to Lender affirming that no such consents or
approvals are required.
(c) Payment of Fees. Borrower shall have paid the Fees required
to be paid on the Closing Date in the respective amounts
specified in the Fee Letter and in Section 1.5, and shall have
reimbursed Lender for all fees, costs and expenses of closing
presented as of the Closing Date.
(d) Borrowing Base Certificate. Lender shall have received the
initial Borrowing Base Certificate, which shall be in form and
substance satisfactory to Lender.
(e) Evidence of Notice of Direction and Related Consent. Lender
shall have received a written consent from each Credit Party to
the giving of a Notice of Direction (as such term is defined in
the Letter of Credit Blocked Account Agreement) by Lender to the
Letter of Credit Blocked Account Bank, which notice shall direct
the Letter of Credit Blocked Account Bank at all times on and
after the Closing Date to transfer all funds on deposit in the
Letter of Credit Blocked Account to the GE Collection Account.
Lender shall have received a written acknowledgement from the
Letter of Credit Blocked Account Bank that it has received and
will comply with the instructions set forth in the Notice of
Direction described in the immediately preceding sentence.
(f) Evidence of Title Insurance Coverage. Lender shall have
received evidence that Borrower has purchased title insurance
coverage, in form and scope satisfactory to Lender, in a total
amount of not less than $50,000,000 in respect of the First Group
of Mortgaged Properties with an allocation on a per Mortgaged
Property basis to be acceptable to Lender in its sole discretion.
(g) Other Documents. Lender shall have received all of the
agreements, instruments and other documents described on Annex B
attached hereto, each in form and substance satisfactory to
Lender in its sole discretion.
(h) Opening Availability. The First Group of Mortgaged
Properties shall satisfy the conditions to eligibility set forth
in the definition of Eligible Mortgaged Properties and shall be
sufficient in value, as determined by Lender, to provide Borrower
with Borrowing Availability, before giving effect to the initial
Revolving Credit Advance made to Borrower, of at least
$15,000,000.
2.2 Conditions to Allow Loans to Exceed $15,000,000. Lender
shall not be obligated to make any Revolving Credit Advances
after the Closing Date, if after giving effect to any such
Revolving Credit Advance the outstanding aggregate principal
balance of the Revolving Loan would be greater than $15,000,000
but less than or equal to $25,000,000, unless (i) the Mortgaged
Properties supporting such Revolving Credit Advances are within
the First Group of Mortgaged Properties and the Second Group of
Mortgaged Properties (and the $50,000,000 of title insurance
obtained pursuant to Section 2.1(f) is modified to also cover the
Second Group of Mortgaged Properties, by tie-in endorsement or in
any other fashion acceptable to Lender, in its sole discretion)
and satisfy all of the conditions to eligibility set forth in the
definition of Eligible Mortgaged Properties, (ii) each of the
conditions precedent set forth in Section 2.4 have been satisfied
or waived in writing by the Lender, and (iii) the proceeds of the
Revolving Credit Advances made pursuant to this Section 2.2 are
disbursed in accordance with the Disbursement Direction Letter
and used by the Borrower in accordance with Section 1.3(a)
hereof.
2.3 Conditions to Allow Loans to Exceed $25,000,000.
Notwithstanding anything to the contrary in this Agreement,
Lender shall not be obligated to make any Revolving Credit
Advances after the Closing Date, if after giving effect to any
such Revolving Credit Advance (the "Subject Revolving Credit
Advance"), the outstanding aggregate principal balance of the
Revolving Loan would exceed $25,000,000, unless and until each of
the following conditions have been satisfied or provided for in a
manner satisfactory to Lender, in Lender's sole discretion, or
waived in writing by Lender:
(a) the Third Group of Mortgaged Properties supporting the
initial Subject Revolving Credit Advance shall satisfy all of the
conditions to eligibility set forth in the definition of Eligible
Mortgaged Properties and shall be sufficient in value as of the
proposed borrowing date relating to the initial Subject Revolving
Credit Advance (the "Post-Closing Borrowing Date"), as determined
by Lender, to provide Borrower with Borrowing Availability, after
giving effect to the initial Revolving Credit Advance made to
Borrower on the Closing Date, but before giving effect to the
initial Subject Revolving Credit Advance, of at least
$25,000,000;
(b) The Post-Closing Borrowing Date shall be a date on or after
November 30, 2001.
(c) On or prior to the initial Post-Closing Borrowing Date, each
of the following conditions have been satisfied with respect to
each of the Third Group of Mortgaged Properties:
(i) each Credit Party shall have executed and delivered to
Lender a Mortgage covering all of the Third Group of Mortgaged
Properties owned by such Credit Party, in proper form for
recordation recorded in all places to the extent necessary to
create a valid and enforceable first priority lien (subject to
Permitted Encumbrances) on such Third Group of Mortgaged
Property in favor of Lender (or in favor of such other trustee as
may be required or desired under local law) and otherwise in form
and substance satisfactory to Lender;
(ii) each Credit Party shall have delivered to Lender current as-
built surveys, zoning letters (or zoning endorsements) and
certificates of occupancy for all of the Third Group of
Mortgaged Properties owned by such Credit Party, in each case
satisfactory in form and substance to Lender, in its sole
discretion;
(iii) each Credit Party shall have delivered to Lender
evidence that counterparts of all of the Mortgages referred to in
clause (i) above of this Section 2.3(c) have been recorded in all
places to the extent necessary to create a valid and enforceable
first priority lien (subject to Permitted Encumbrances) on all of
the Third Group of Mortgaged Properties owned by such Credit
Party in favor of Lender (or in favor of such other trustee as
may be required or desired under local law);
(iv) Credit Parties shall have delivered to Lender an opinion of
counsel in each state in which the Third Group of Mortgaged
Properties are located regarding the Mortgages on said properties
in form and substance and from counsel satisfactory to Lender;
(v) each of the Credit Parties shall have fully cooperated with
Lender by providing Lender and/or its consultants and agents with
access to, and information concerning, all of the Third Group of
Mortgaged Properties as may be requested by Lender (or such
consultant or agent of Lender) and as may be necessary to ensure
completion of Phase I Environmental Site Assessment Reports,
consistent with American Society for Testing and Materials (ASTM)
Standard E 1527-94 and applicable state requirements, on all of
the Third Group of Mortgaged Properties, dated no more than 6
months prior to the Closing Date, prepared by environmental
engineers satisfactory to Lender, all in form and substance
satisfactory to Lender, in its sole discretion; and Credit
Parties shall have fully cooperated with Lender by providing
Lender and/or its consultants and agents with access to, and
information concerning, all of the Third Group of Mortgaged
Properties as may be requested by Lender as may be necessary to
ensure that Lender shall have further received such environmental
review and audit reports, including Phase II reports, with
respect to any of the Third Group of Mortgaged Properties as
Lender shall have requested, and Lender shall be satisfied, in
its sole discretion, with the contents of all such environmental
reports;
(vi) Credit Parties shall have delivered to Lender letters
executed by the environmental firms preparing the environmental
reports referred to in Section 2.3(c)(v), in form and substance
satisfactory to Lender, authorizing Lender to rely on such
reports; and
(vii) Credit Parties shall have delivered to Lender fair
market value appraisals on all of the Third Group of Mortgaged
Properties, each of which shall be in form and substance
satisfactory to Lender.
(d) Evidence of Title Insurance Coverage. On or prior to the
initial Post-Closing Borrowing Date, Lender shall have received
evidence that Borrower has purchased title insurance coverage, in
form and scope satisfactory to Lender, in a total amount of not
less than $100,000,000 in respect of all of the Mortgaged
Properties (including, without limitation, the Third Group of
Eligible Properties) with an allocation on a per Mortgaged
Property basis to be acceptable to Lender in its sole discretion
.
(e) On or prior to the initial Post-Closing Borrowing Date,
EBITDA (as defined in Annex D) for the period of two consecutive
Fiscal Months most recently ended prior to such date was greater
than the amount set forth below for such period:
Period Minimum EBITDA
Two consecutive Fiscal $3,000,000
Months ending on
November 30, 2001
Two consecutive Fiscal $3,200,000
Months ending on
December 31, 2001
Two consecutive Fiscal -$4,000,000
Months ending on January
31, 2002
Two consecutive Fiscal -$5,800,000
Months ending on
February 28, 2002
Two consecutive Fiscal $3,900,000
Months ending on Xxxxx
00, 0000
(x) On or prior to the initial Post-Closing Borrowing Date, the
average Laden Load Factor for CF Delaware for the period of two
consecutive Fiscal Months most recently ended prior to such date
shall be greater than the amount set forth below for such period:
Period Minimum Laden
Load Factor (in Pounds)
Two consecutive Fiscal 31,000
Months ending on
November 30, 2001
Two consecutive Fiscal 31,120
Months ending on
December 31, 2001
Two consecutive Fiscal 31,242
Months ending on January
31, 2002
Two consecutive Fiscal 31,363
Months ending on
February 28, 2002
Two consecutive Fiscal 31,363
Months ending on March
31, 2002
(g) On or prior to the initial Post-Closing Borrowing Date, the
average Gross LTL Rev/cwt for CF Delaware for the period of two
consecutive Fiscal Months most recently ended prior to such date
was greater than the amount set forth below for such period:
Period Minimum Gross
LTL Rev/cwt
Two consecutive Fiscal $19.97
Months ending on
November 30, 2001
Two consecutive Fiscal $19.78
Months ending on
December 31, 2001
Two consecutive Fiscal $19.73
Months ending on January
31, 2002
Two consecutive Fiscal $19.87
Months ending on
February 28, 2002
Two consecutive Fiscal $19.94
Months ending on March
31, 2002
(h) On the initial Post-Closing Borrowing Date, Borrower shall
have delivered to Lender (i) a supplement to Annex F which shall
identify the Mortgaged Properties that Borrower proposes be
included as Third Group of Mortgaged Properties (such supplement
shall not be deemed to modify Annex F unless such supplement has
been consented to by Lender in writing) and (ii) a certificate of
the Chief Financial Officer of Borrower certifying that all of
the conditions set forth in this Section 2.3 have been satisfied,
which certificate shall contain detailed calculations
demonstrating compliance with clauses (e), (f) and (g) of this
Section 2.3 and otherwise be in form and substance satisfactory
to Lender.
(i) each of the conditions precedent set forth in Section 2.4
have been satisfied or waived in writing by the Lender.
2.4 Further Conditions to Each Loan. Lender shall not be
obligated to fund any Revolving Credit Advance, if, as of the
date thereof:
(a) any representation or warranty by any Credit Party contained
herein or in any other Loan Document is untrue or incorrect in
any material respect as of such date, except to the extent that
such representation or warranty expressly relates to an earlier
date and except for changes therein expressly permitted or
expressly contemplated by this Agreement; or
(b) any event or circumstance having a Material Adverse Effect
has occurred since the date hereof; or
(c) any Default or Event of Default has occurred and is
continuing or would result after giving effect to any Revolving
Credit Advance; or
(d) after giving effect to any Revolving Credit Advance, the
outstanding principal amount of the Revolving Loan would exceed
the lesser of the Borrowing Base and the Revolving Loan
Commitment; or
(e) Borrower has failed to deliver to Lender a Borrowing Base
Certificate, in form and substance satisfactory to Lender, as of
the date of any requested borrowing.
The request and acceptance by Borrower of the proceeds of any
Revolving Credit Advance shall be deemed to constitute, as of the
date thereof, (i) a representation and warranty by Borrower that
the conditions in this Section 2.3 have been satisfied and (ii) a
reaffirmation by Borrower of the granting and continuance of
Lender's Liens pursuant to the Collateral Documents.
2.5 Conditions Precedent for Partial Release of Mortgaged
Properties. Upon the prior written consent of Lender, which
consent may not be unreasonably withheld by Lender, Borrower will
be entitled to obtain a release of Lender's Liens in any one or
more of the Mortgaged Properties under the applicable Mortgage or
Mortgages provided that prior to such release Borrower satisfies
each and every of the conditions precedent for such release
stated in Annex G hereto and makes any payments required under
such Annex G with respect to such release.
3. REPRESENTATIONS AND WARRANTIES
To induce Lender to make the Loans, the Credit Parties
executing this Agreement, jointly and severally, make the
following representations and warranties to Lender with respect
to all Credit Parties, each and all of which shall survive the
execution and delivery of this Agreement.
3.1 Corporate Existence; Compliance with Law. Each Credit Party
(a) is a corporation, limited liability company or a limited
partnership duly formed, validly existing and in good standing
under the laws of its jurisdiction of formation; (b) is duly
qualified to conduct business and is in good standing in each
other jurisdiction where its ownership or lease of property or
the conduct of its business requires such qualification, except
where the failure to be so qualified, individually or in the
aggregate, could not reasonably be expected to have a Material
Adverse Effect; (c) has the requisite corporate, company or
partnership power and authority and the legal right to own,
pledge, mortgage or otherwise encumber and operate its
properties, to lease the property it operates under lease and to
conduct its business as now, heretofore and proposed to be
conducted; (d) subject to specific representations regarding
Environmental Laws, has all licenses, permits, consents or
approvals from or by, and has made all filings with, and has
given all notices to, all Governmental Authorities having
jurisdiction, to the extent required for such ownership,
operation and conduct, except where the failure to comply,
individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect; (e) is in compliance
with its charter and by-laws; and (f) subject to specific
representations set forth herein regarding ERISA, Environmental
Laws, tax and other laws, is in compliance with all applicable
provisions of law, except where the failure to comply,
individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
3.2 Executive Offices; FEIN. As of the Closing Date, the
current location of each Credit Party's chief executive office
and principal place of business is set forth in the Disclosure
Schedule (3.2), and except as set forth in such Schedule none of
such locations have changed within the twelve (12) months
preceding the Closing Date. In addition, the Disclosure Schedule
(3.2) lists the federal employer identification number and
organizational identification number of each Credit Party.
3.3 Power, Authorization, Enforceable Obligations. The
execution, delivery and performance by each Credit Party of the
Loan Documents to which it is a party and the creation of all
Liens provided for therein: (a) are within such Person's
corporate, limited liability company or partnership power; (b)
have been duly authorized by all necessary or proper corporate,
company, partnership, shareholder or membership action, as
applicable; (c) do not contravene any provision of such Person's
charter, bylaws or other constitutive documents; (d) do not
violate any law or regulation, or any order or decree of any
court or Governmental Authority; (e) do not conflict with or
result in the breach or termination of, constitute a default
under or accelerate or permit the acceleration of any performance
required by, any indenture, mortgage, deed of trust, lease,
agreement or other instrument to which such Person is a party or
by which such Person or any of its property is bound; (f) do not
result in the creation or imposition of any Lien upon any of the
property of such Person other than those in favor of Lender
pursuant to the Loan Documents and the Letter of Credit
Documents; and (g) do not require the consent or approval of any
Governmental Authority or any other Person, except those referred
to in Section 2.1(b), all of which will have been duly obtained,
made or complied with prior to the Closing Date. On or prior to
the Closing Date, each of the Loan Documents shall have been duly
executed and delivered by each Credit Party thereto and each such
Loan Document shall then constitute a legal, valid and binding
obligation of such Credit Party enforceable against it in
accordance with its terms, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditor's rights generally.
3.4 Financial Statements. All Financial Statements concerning
Borrower and its Subsidiaries which have been delivered to Lender
have been prepared in accordance with GAAP consistently applied
throughout the periods covered (except as disclosed therein and
except, with respect to unaudited Financial Statements, for the
absence of footnotes and normal year-end audit adjustments) and
present fairly in all material respects the financial position of
the Persons covered thereby as at the dates thereof and the
results of their operations and cash flows for the periods then
ended.
3.5 Material Adverse Effect. Between December 31, 2000 and the
Closing Date, (a) no Credit Party has incurred any obligations,
contingent or non-contingent liabilities, liabilities for
Charges, long-term leases or unusual forward or long-term
commitments which, alone or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, (b) no contract,
lease or other agreement or instrument has been entered into by
any Credit Party or has become binding upon any Credit Party's
assets and no law or regulation applicable to any Credit Party
has been adopted which, in any case, has had or could reasonably
be expected to have a Material Adverse Effect, (c) except for the
defaults, if any, under the Existing Credit Agreement and the
Participation Agreement, in each case as disclosed on Disclosure
Schedule (3.5), no Credit Party is in default under any loan
agreement, indenture, note or bond evidencing any obligations of
such Credit Party, and (d) no Credit Party is in default and to
the best of Borrower's knowledge no third party is in default
under any contract, lease or other agreement or instrument, which
alone or in the aggregate could reasonably be expected to have a
Material Adverse Effect. Between December 31, 2000 and the
Closing Date no event has occurred, which alone or together with
other events, could reasonably be expected to have a Material
Adverse Effect.
3.6 Ownership of Property; Liens. Each Credit Party has good
and marketable title to, or valid leasehold interests in, all of
its properties and assets. As of the Closing Date, none of the
properties and assets of any Credit Party are subject to any
Liens other than Permitted Encumbrances, and there are no facts,
circumstances or conditions known to any Credit Party that may
result in any Liens (including Liens arising under Environmental
Laws) other than Permitted Encumbrances.
3.7 Labor Matters. As of the Closing Date and except as
disclosed on Disclosure Schedule (3.7) (a) no strikes, lockouts
or other material labor disputes against any Credit Party are
pending or, to any Credit Party's knowledge, threatened; (b)
hours worked by and payment made to employees of each Credit
Party comply with the Fair Labor Standards Act and each other
federal, state, local or foreign law applicable; (c) all payments
due from any Credit Party for employee health and welfare
insurance have been paid or accrued as a liability on the books
of such Credit Party; (d) except as set forth in Disclosure
Schedule (3.7), no Credit Party is a party to or bound by any
collective bargaining agreement (and true and complete copies of
any agreements described on Disclosure Schedule (3.7) shall be
delivered upon request to Lender); (e) to the knowledge of the
Executive Officers of Borrower there is no organizing activity
involving any Credit Party pending or, to any Credit Party's
knowledge, threatened by any labor union or group of employees;
(f) there are no representation proceedings pending or, to any
Credit Party's knowledge, threatened with the National Labor
Relations Board, and to the knowledge of the Executive Officers
of Borrower no labor organization or group of employees of any
Credit Party has made a pending demand for recognition; and (g)
except as set forth in Disclosure Schedule (3.7), there are no
complaints or charges against any Credit Party pending or, to the
knowledge of any Credit Party, threatened to be filed with any
Governmental Authority or arbitrator based on, arising out of, in
connection with, or otherwise relating to the employment or
termination of employment by any Credit Party of any individual,
except in the case of the matters described in clause (b), (c)
and (g) above, for such failures to comply or pay that could not
reasonably be expected to result individually or in the aggregate
in a liability of the Credit Parties in excess of $5,000,000.
3.8 Ventures, Subsidiaries and Affiliates; Outstanding Stock and
Indebtedness. Except as set forth in Disclosure Schedule (3.8),
no Credit Party has any Subsidiaries, is engaged in any joint
venture or partnership with any other Person under which such
Credit Party is liable for any debts or liabilities of such
Person, or as of the Closing Date is an Affiliate of any other
Person. Borrower shall provide Lender with written notice,
promptly upon its learning thereof, of each Person who becomes an
Affiliate of the Borrower after the Closing Date. All of the
issued and outstanding Stock of each Credit Party is owned by
each of the stockholders and in the amounts set forth on
Disclosure Schedule (3.8). Except as set forth in Disclosure
Schedule (3.8), there are no outstanding rights to purchase,
options, warrants or similar rights or agreements pursuant to
which any Credit Party may be required to issue, sell, repurchase
or redeem any of its Stock or other equity securities or any
Stock or other equity securities of its Subsidiaries. All
outstanding Indebtedness of each Credit Party (other than the
Obligations) as of the Closing Date is described in Section 6.3
(including Disclosure Schedule (6.3)).
3.9 Government Regulation. No Credit Party is subject to
regulation under the Investment Company Act of 1940, as amended,
the Public Utility Holding Company Act of 1935, as amended, the
Federal Power Act, as amended, or any other federal or state
statute that restricts or limits its ability to incur
Indebtedness or to perform its obligations hereunder. The making
of the Loans by Lender to Borrower, the application of the
proceeds thereof and repayment thereof will not violate any
provision of any such statute or any rule, regulation or order
issued by the Securities and Exchange Commission.
3.10 Margin Regulations. No Credit Party is engaged, nor will it
engage, principally or as one of its important activities, in the
business of extending credit for the purpose of "purchasing" or
"carrying" any "margin security" as such terms are defined in
Regulation U of the Federal Reserve Board as now and from time to
time hereafter in effect (such securities being referred to
herein as "Margin Stock"). No Credit Party owns any Margin
Stock, with a value, in the aggregate, in excess of one percent
(1%) of such Credit Party's gross assets and none of the proceeds
of the Loans or other extensions of credit under this Agreement
will be used, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock, for the purpose of
reducing or retiring any Indebtedness which was originally
incurred to purchase or carry any Margin Stock or for any other
purpose which might cause any of the Loans or other extensions of
credit under this Agreement to be considered a "purpose credit"
within the meaning of Regulation T, U or X of the Federal Reserve
Board. No Credit Party will take or permit to be taken any
action which might cause any Loan Document to violate Regulation
T, U or X of the Federal Reserve Board.
3.11 Taxes. All material tax returns, reports and statements,
including information returns, required by any Governmental
Authority to be filed by any Credit Party have been filed with
the appropriate Governmental Authority and all Charges have been
paid prior to the date on which any fine, penalty, interest or
late charge may be added thereto for nonpayment thereof (or any
such fine, penalty, interest, late charge or loss has been paid),
excluding Charges or other amounts being contested in accordance
with Section 5.2(b). Proper and accurate amounts have been
withheld by each Credit Party from its respective employees for
all periods in full and complete compliance with all applicable
federal, state, local and foreign law and such with Borrower have
been timely paid to the respective Governmental Authorities
except for such amounts that in the aggregate for all Credit
Parties combined would not at any time exceed $1,000,000.
Disclosure Schedule (3.11) sets forth as of the Closing Date
those taxable years for which any Credit Party's tax returns are
currently being audited by the IRS or any other applicable
Governmental Authority and any assessments or threatened
assessments in connection with such audit, or otherwise currently
outstanding. Except as described on Disclosure Schedule (3.11),
no Credit Party has executed or filed with the IRS or any other
Governmental Authority any agreement or other document extending,
or having the effect of extending, the period for assessment or
collection of any Charges. Except as described on Disclosure
Schedule (3.11), none of the Credit Parties and their respective
predecessors are liable for any Charges: (a) under any written
agreement (including any tax sharing agreements) or (b) to each
Credit Party's knowledge, as a transferee. As of the Closing
Date, no Credit Party has agreed or been requested to make any
adjustment under IRC Section 481(a), by reason of a change in
accounting method or otherwise, which would have a Material
Adverse Effect.
3.12 ERISA. (a) Disclosure Schedule (3.12) lists and separately
identifies all Title IV Plans, Multiemployer Plans, ESOPs and
Retiree Welfare Plans other than any Plans maintained by a labor
union. Except with respect to Multiemployer Plans and Plans
maintained by a labor union, each Qualified Plan has been
determined by the IRS to qualify under Section 401 of the IRC, or
has been submitted for such a determination, and the trusts
created thereunder have been determined to be exempt from tax
under the provisions of Section 501 of the IRC, and nothing has
occurred which would cause the loss of such qualification or tax-
exempt status. Each Plan is in compliance in all material
respects with the applicable provisions of ERISA and the IRC,
including the filing of reports required under the IRC or ERISA
and no Credit Party or ERISA Affiliate has failed to make any
contribution or pay any amount due as required by either Section
412 of the IRC or Section 302 of ERISA or the terms of any such
Plan, except for any such failures which individually or in the
aggregate, together with the aggregate amount of any liability of
the type described in Section 3.12(b) and the aggregate amount of
any liability of the type described in the last sentence of this
Section 3.12(a), could not reasonably be expected to result in a
liability of the Credit Parties individually or in the aggregate
of $10,000,000 or more. No Credit Party or ERISA Affiliate has
engaged in a prohibited transaction, as defined in Section 4975
of the IRC, in connection with any Plan, which would subject any
Credit Party to a tax on prohibited transactions imposed by
Section 4975 of the IRC, except for such prohibited transactions,
which individually or in the aggregate, together with the
aggregate amount of any liability of the type described in
Section 3.12(b) and in the immediately preceding sentence, could
not reasonably be expected to result in a liability of the Credit
Parties individually or in the aggregate of $10,000,000 or more.
(b) Except as set forth in Disclosure Schedule (3.12): (i) no
Title IV Plan has any Unfunded Pension Liability; (ii) no ERISA
Event or event described in Section 4062(e) of ERISA with respect
to any Title IV Plan has occurred or is reasonably expected to
occur; (iii) there are no pending, or to the knowledge of any
Credit Party, threatened claims (other than claims for benefits
in the normal course), sanctions, actions or lawsuits, asserted
or instituted against any Plan or any Person as fiduciary or
sponsor of any Plan; (iv) no Credit Party or ERISA Affiliate has
incurred or reasonably expects to incur any liability as a result
of a complete or partial withdrawal from a Multiemployer Plan;
(v) within the last five years no Title IV Plan with Unfunded
Pension Liabilities has been transferred outside of the
"controlled group" (within the meaning of Section 4001(a)(14) of
ERISA) of any Credit Party or ERISA Affiliate; and (vi) no
liability under any Title IV Plan has been satisfied with the
purchase of a contract from an insurance company that is not
rated AAA by the Standard & Poor's Corporation or the equivalent
by another nationally recognized rating agency; except for any
such liability under this Section 3.12(b) which individually or
in the aggregate, together with the aggregate amount of any
liability of the type described in the penultimate sentence and
the last sentence of Section 3.12(a), could not reasonably be
expected to result in a liability of the Credit Parties
individually or in the aggregate of $10,000,000 or more.
3.13 No Litigation. No action, claim, lawsuit, demand,
investigation or proceeding is now pending or, to the knowledge
of any Credit Party, threatened against any Credit Party, before
any Governmental Authority or before any arbitrator or panel of
arbitrators (collectively, "Litigation"), (a) which challenges
any Credit Party's right or power to enter into or perform any of
its obligations under the Loan Documents to which it is a party,
or the validity or enforceability of any Loan Document or any
action taken thereunder, or (b) which could reasonably be
expected to have a Material Adverse Effect. Except as set forth
on Disclosure Schedule (3.13), as of the Closing Date there is no
Litigation pending or, to the knowledge of any Credit Party,
threatened which seeks damages in excess of $10,000,000 or
injunctive relief (other than injunctive relief relating to labor
practices, which, together with all such other injunctions, could
not be reasonably expected to have a Material Adverse Effect) or
alleges criminal misconduct of any Credit Party.
3.14 Brokers. No broker or finder acting on behalf of any Credit
Party brought about the obtaining, making or closing of the Loans
or the related transactions, and no Credit Party has any
obligation to any Person in respect of any finder's or brokerage
fees in connection therewith.
3.15 Intellectual Property. As of the Closing Date, each Credit
Party owns or has rights to use all Intellectual Property
necessary to continue to conduct its business as now or
heretofore conducted by it or proposed to be conducted by it.
Except as set forth in Disclosure Schedule (3.15), each Credit
Party conducts its business and affairs without known
infringement of or interference with any Intellectual Property of
any other Person.
3.16 Full Disclosure. No information contained in this
Agreement, any of the other Loan Documents, any Financial
Statements, any Borrowing Base Certificate, any Collateral
reports or other reports from time to time delivered hereunder or
any written statement furnished by or on behalf of any Credit
Party to Lender pursuant to the terms of this Agreement contains
or will contain any untrue statement of a material fact or omits
or will omit to state a material fact necessary to make the
statements contained herein or therein not misleading in light of
the circumstances under which they were made.
3.17 Environmental Matters. Except as set forth in Disclosure
Schedule (3.17), as of the Closing Date: (i) the Real Estate is
free of contamination from any Hazardous Material except for such
contamination that would not adversely impact the value or
marketability of such Real Estate and that would not result in
Environmental Liabilities that could reasonably be expected to
exceed $10,000,000 or, to the extent such matter affects any of
the Collateral, $500,000; (ii) no Credit Party has caused or
suffered to occur any Release of Hazardous Materials on, at, in,
under, above, to, from or about any of its Real Estate; (iii) the
Credit Parties are and have been in compliance with all
Environmental Laws, except for such noncompliance which would not
result in Environmental Liabilities which could reasonably be
expected to exceed $10,000,000 or, to the extent such matter
affects any of the Collateral, $500,000; (iv) the Credit Parties
have obtained, and are in compliance with, all Environmental
Permits required by Environmental Laws for the operations of
their respective businesses as presently conducted or as proposed
to be conducted, except where the failure to so obtain or comply
with such Environmental Permits would not result in Environmental
Liabilities which could reasonably be expected to exceed
$10,000,000 or, to the extent such matter affects any of the
Collateral, $500,000, and all such Environmental Permits are
valid, uncontested and in good standing; (v) no Credit Party is
involved in operations or knows of any facts, circumstances or
conditions, including any Releases of Hazardous Materials, that
are likely to result in any Environmental Liabilities of such
Credit Party which could reasonably be expected to exceed
$10,000,000 or, to the extent such matter affects any of the
Collateral, $500,000, and no Credit Party has permitted any
current or former tenant or occupant of real estate owned by such
Credit Party to engage in any such operations; (vi) there is no
Litigation arising under or related to any Environmental Laws,
Environmental Permits or Hazardous Material which seeks damages,
penalties, fines, costs or expenses in excess of $10,000,000 or,
to the extent such matter affects any of the Collateral,
$500,000, or injunctive relief, or which alleges criminal
misconduct by any Credit Party; (vii) no notice has been received
by any Credit Party identifying it as a "potentially responsible
party" or requesting information under CERCLA or analogous state
statutes, and to the knowledge of the Credit Parties, there are
no facts, circumstances or conditions that may result in any
Credit Party being identified as a "potentially responsible
party" under CERCLA or analogous state statutes; and (viii) the
Credit Parties have provided to Lender copies of all existing
environmental reports, reviews and audits and all written
information pertaining to actual or potential Environmental
Liabilities, in each case relating to any Credit Party.
3.18 Insurance. Disclosure Schedule (3.18) lists all insurance
policies of any nature maintained, as of the Closing Date, for
current occurrences by each Credit Party, as well as a summary of
the terms of each such policy.
3.19 Solvency. Both before and after giving effect to (a) the
making of the Loans on the Closing Date or such other date as any
of the Loans requested hereunder are made, and (b) payment and
accrual of all transaction costs in connection with the
foregoing, each Credit Party is Solvent.
4. FINANCIAL STATEMENTS AND INFORMATION
4.1 Reports and Notices.
(a) Borrower hereby agrees that, from and after the Closing Date
and until the Termination Date, it shall deliver (or cause to be
delivered) to Lender copies of all of the financial statements,
notices and other documents and information at the times and in
the manner set forth in Annex C.
(b) The Borrower hereby agrees that, from and after the Closing
Date and until the Commitment Termination Date, it shall deliver
or cause to be delivered to Lender such other reports, statements
and reconciliations with respect to the Collateral as Lender
shall from time to time request in its reasonable discretion.
4.2 Communication with Accountants. Borrower authorizes Lender
to communicate directly with its independent certified public
accountants including Xxxxxx Xxxxxxxx LLP, and authorizes and
shall instruct those accountants and advisors to disclose and
make available to Lender any and all Financial Statements and
other supporting financial documents, schedules and information
relating to any Credit Party (including copies of any issued
management letters) with respect to the business, financial
condition and other affairs of any Credit Party, provided,
however, in the absence of a Default or an Event of Default, the
Lender shall give not less than (5) Business Days' notice to
Borrower prior to scheduling any meeting or other material
communication with such independent certified public accountants.
Such notice shall contain the date, time, location and other
pertinent logistical information regarding any such meeting or
other material communication, as well as an agenda for such
meeting or other material communication.
5. AFFIRMATIVE COVENANTS
Each Credit Party executing this Agreement jointly and
severally agrees as to all Credit Parties that from and after the
date hereof and until the Termination Date:
5.1 Maintenance of Existence and Conduct of Business. Except as
permitted by Section 6.1 or 6.14, each Credit Party shall: do or
cause to be done all things necessary to preserve and keep in
full force and effect its corporate, company or limited
partnership existence as applicable, and its rights and
franchises; continue to conduct its business substantially as
now conducted or as otherwise permitted hereunder; at all times
maintain, preserve and protect all of its assets and properties
used or useful in the conduct of its business, and keep the same
in good repair, working order and condition in all material
respects (taking into consideration ordinary wear and tear) and
from time to time make, or cause to be made, all necessary or
appropriate repairs, replacements and improvements thereto
consistent with such Credit Party's current practices; and
transact business only in such corporate and trade names as are
set forth in the disclosure schedules to the Security Agreement.
5.2 Payment of Obligations. (a) Subject to Section 5.2(b),
each Credit Party shall pay and discharge or cause to be paid and
discharged promptly when due (A) all Charges payable by it or
imposed upon it, its income and profits, or any of its property
(real, personal or mixed) and all Charges with respect to tax,
social security and unemployment withholding with respect to its
employees, and (B) lawful claims for labor, materials, supplies
and services or otherwise (other than in the case of this clause
(B) current liabilities incurred in the ordinary course of
business).
(b) Each Credit Party may in good faith contest, by appropriate
proceedings, the validity or amount of any Charges described in
Section 5.2(a); provided, (i) adequate reserves with respect to
such contest are maintained on the books of such Credit Party, in
accordance with GAAP, (ii) no Lien shall be imposed to secure
payment of such Charges that is superior to any of the Liens
securing the Obligations and such contest is maintained and
prosecuted continuously and with diligence and operates to
suspend collection or enforcement of such Charges; (iii) none of
the Collateral becomes subject to a material risk of forfeiture
or loss as a result of such contest, (iv) such Credit Party shall
promptly pay or discharge such contested Charges or claims and
all additional charges, interest, penalties and expenses, if any,
and shall deliver to Lender evidence acceptable to Lender of such
compliance, payment or discharge, if such contest is terminated
or discontinued adversely to such Credit Party or the conditions
set forth in this Section 5.2(b) are no longer met, and (v)
Lender has not advised Borrower in writing that Lender reasonably
believes that nonpayment or nondischarge thereof could have or
result in a Material Adverse Effect.
5.3 Books and Records. Each Credit Party shall keep adequate
books and records with respect to its business activities in
which proper entries, reflecting all financial transactions, are
made in accordance with GAAP and on a basis consistent with the
Financial Statements.
5.4 Insurance; Damage to or Destruction of Collateral. (a) The
Credit Parties shall, at their sole cost and expense, maintain
insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is
usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which each
Credit Party operates. Notwithstanding the foregoing, the Credit
Parties may maintain a plan or plans of self-insurance to such
extent and covering such risks as is usual for companies of
similar size engaged in the same or similar businesses and owning
similar properties. Each Credit Party shall also furnish upon
the request of the Lender (A) a certificate of each Credit
Party's insurance broker or other insurance specialists stating
that all premiums then due on the policies relating to insurance
on the Collateral have been paid, that such policies are in full
force and effect and that such insurance coverage and such
policies comply with all the requirements of this subsection and
(B) details of such plan or plans of self-insurance. Each of the
insurance policies required under this subsection shall provide
that it shall not be terminated or cancelled nor shall any such
policy be materially changed without at least 30 days' prior
written notice to the appropriate Credit Party and, in the case
of general liability and property policies, Lender. If any
Credit Party at any time or times hereafter shall fail to obtain
or maintain any of the policies of insurance required above or to
pay all premiums relating thereto, Lender may at any time or
times thereafter obtain and maintain such policies of insurance
and pay such premiums and take any other action with respect
thereto that Lender deems advisable. Lender shall have no
obligation to obtain insurance for any Credit Party or pay any
premiums therefor. By doing so, Lender shall not be deemed to
have waived any Default or Event of Default arising from any
Credit Party's failure to maintain such insurance or pay any
premiums therefor. All sums so disbursed, including reasonable
attorneys' fees, court costs and other charges related thereto,
shall be payable on demand by Borrower to Lender and shall be
additional Obligations hereunder secured by the Collateral.
(b) Lender reserves the right at any time upon any
change in any Credit Party's risk profile (including any change
in the product mix maintained by any Credit Party or any laws
affecting the potential liability of such Credit Party) to
require additional forms and limits of insurance to, in Lender's
opinion, adequately protect both Lender's interests in all or any
portion of the Collateral and to ensure that each Credit Party is
protected by insurance in amounts and with coverage customary for
its industry. If reasonably requested by Lender, each Credit
Party shall deliver to Lender from time to time a report of a
reputable insurance broker, satisfactory to Lender, with respect
to its insurance policies.
(c) Each Credit Party shall deliver to Lender, in form
and substance reasonably satisfactory to Lender, endorsements to
(i) all "All Risk" insurance naming Lender as loss payee, (ii)
all general liability policies naming Lender as additional
insured, and (iii) fire and other casualty insurance policies in
respect of the Mortgaged Properties naming Lender as additional
insured and loss payee. Each Credit Party irrevocably makes,
constitutes and appoints Lender (and all officers, employees or
agents designated by Lender), so long as any Default or Event of
Default has occurred and is continuing or the anticipated
insurance proceeds exceed $250,000, as such Credit Party's true
and lawful agent and attorney-in-fact for the purpose of making
and settling claims under such "All Risk" policies of insurance,
endorsing the name of such Credit Party on any check or other
item of payment for the proceeds of such "All Risk" policies of
insurance. Lender shall have no duty to exercise any rights or
powers granted to it pursuant to the foregoing power-of-attorney.
Borrower shall promptly notify Lender of any loss, damage, or
destruction to the Collateral in the amount of $250,000 or more,
whether or not covered by insurance. After deducting from such
proceeds the expenses, if any, incurred by Lender in the
collection or handling thereof, Lender may, at its option, apply
such proceeds to the reduction of the Obligations in accordance
with Section 1.2(d), or permit or require such Credit Party to
use such money, or any part thereof, to replace, repair, restore
or rebuild the Collateral in a diligent and expeditious manner
with materials and workmanship of substantially the same quality
as existed before the loss, damage or destruction.
Notwithstanding the foregoing, if the casualty giving rise to
such insurance proceeds could not reasonably be expected to have
a Material Adverse Effect and such insurance proceeds do not
exceed $250,000 in the aggregate, Lender shall permit such Credit
Party to replace, restore, repair or rebuild the property;
provided that if such Credit Party has not completed or entered
into binding agreements to complete such replacement,
restoration, repair or rebuilding within 180 days of such
casualty, Lender may apply such insurance proceeds to the
Obligations in accordance with Section 1.2(d). All insurance
proceeds that are to be made available to Borrower to replace,
repair, restore or rebuild the Collateral shall be applied by
Lender to reduce the outstanding principal balance of the
Revolving Loan (which application shall not result in a permanent
reduction of the Revolving Loan Commitment) and upon such
application, Lender shall establish a Reserve against the
Borrowing Base in an amount equal to the amount of such proceeds
so applied. All insurance proceeds made available to any Credit
Party (other than Borrower) to replace, repair, restore or
rebuild collateral shall be deposited in a cash collateral
account pledged to Lender. Thereafter, such funds shall be made
available to the applicable Credit Party to provide funds to
replace, repair, restore or rebuild the Collateral as follows:
(i) Borrower shall request a Revolving Credit Advance or a
release from the cash collateral account in the amount requested
to be released; (ii) so long as the conditions set forth in
Sections 2.2 and 2.3 have been met, Lender shall make such
Revolving Credit Advance or Lender shall release such funds from
the cash collateral account; and (iii) in the case of insurance
proceeds applied against the Revolving Loan, the Reserve
established with respect to such insurance proceeds shall be
reduced by the amount of such Revolving Credit Advance. To the
extent not used to replace, repair, restore or rebuild the
Collateral, such insurance proceeds shall be applied in
accordance with Section 1.2(d).
5.5 Compliance with Laws. Each Credit Party shall comply with
all federal, state, local, and foreign laws and regulations
applicable to it, including those relating to licensing, ERISA
and labor matters and Environmental Laws and Environmental
Permits, except to the extent that the failure to comply,
individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
5.6 Supplemental Disclosure. From time to time as may be
requested by Lender (which request will not be made more
frequently than once each year absent the occurrence and
continuance of a Default or an Event of Default), the Credit
Parties shall supplement each disclosure schedule attached hereto
or attached to the Security Agreement, or any representation
herein or in any other Loan Document, with respect to any matter
hereafter arising which, if existing or occurring at the date of
this Agreement, would have been required to be set forth or
described in such disclosure schedule or as an exception to such
representation or which is necessary to correct any information
in such disclosure schedule or representation which has been
rendered materially inaccurate thereby (and, in the case of any
supplements to any disclosure schedule, such disclosure schedule
shall be appropriately marked to show the changes made therein);
provided that (a) no such supplement to any such disclosure
schedule or representation shall be or be deemed a waiver of any
Default or Event of Default resulting from the matters disclosed
therein, except as consented to by Lender in writing; (b) no
supplement shall be required as to representations and warranties
that relate solely to the Closing Date; and (c) the applicable
disclosure schedule shall be deemed to be modified by such
supplement to the extent and only to the extent that such
supplement has been consented to by Lender in writing.
5.7 Intellectual Property. Each Credit Party will conduct its
business and affairs without knowing and willful infringement of
or interference with any Intellectual Property of any other
Person in any material respect.
5.8 Environmental Matters. Each Credit Party shall and shall
cause each Person within its control to: (a) conduct its
operations and keep and maintain its real estate in compliance
with all Environmental Laws and Environmental Permits other than
noncompliance which could not reasonably be expected to have a
Material Adverse Effect; (b) implement any and all investigation,
remediation, removal and response actions that are appropriate or
necessary to maintain the value and marketability of the Real
Estate or to otherwise comply with Environmental Laws and
Environmental Permits pertaining to the presence, generation,
treatment, storage, use, disposal, transportation or Release of
any Hazardous Material on, at, in, under, above, to, from or
about any of its Real Estate; (c) notify Lender promptly after
such Credit Party becomes aware of any violation of Environmental
Laws or Environmental Permits or any Release on, at, in, under,
above, to, from or about any real estate which is reasonably
likely to result in Environmental Liabilities in excess of
$10,000,000 or, to the extent such matter affects any of the
Collateral, $500,000; and (d) promptly forward to Lender a copy
of any order, notice, request for information or any
communication or report received by such Credit Party in
connection with any such violation or Release or any other matter
relating to any Environmental Laws or Environmental Permits that
could reasonably be expected to result in Environmental
Liabilities in excess of $10,000,000 or, to the extent such
matter affects any of the Collateral, $500,000, in each case
whether or not the Environmental Protection Agency or any
Governmental Authority has taken or threatened any action in
connection with any such violation, Release or other matter. If
Lender at any time has a reasonable basis to believe that there
may be a violation of any Environmental Laws or Environmental
Permits by any Credit Party or any Environmental Liability
arising thereunder, or a Release of Hazardous Materials on, at,
in, under, above, to, from or about any of its Real Estate,
which, in each case, could reasonably be expected to have a
Material Adverse Effect, then each Credit Party shall, upon
Lender's written request (i) cause the performance of such
environmental audits including subsurface sampling of soil and
groundwater, and preparation of such environmental reports, at
Borrower's expense, as Lender may from time to time reasonably
request, which shall be conducted by reputable environmental
consulting firms acceptable to Lender and shall be in form and
substance reasonably acceptable to Lender, and (ii) permit Lender
or its representatives to have access to all Real Estate for the
purpose of conducting such environmental audits and testing as
Lender deems appropriate, including subsurface sampling of soil
and groundwater. Borrower shall reimburse Lender for the costs
of such audits and tests and the same will constitute a part of
the Obligations secured hereunder.
5.9 Further Assurances. Each Credit Party executing this
Agreement agrees that it shall and shall cause each other Credit
Party to, at such Credit Party's expense and upon request of
Lender, duly execute and deliver, or cause to be duly executed
and delivered, to Lender such further instruments and do and
cause to be done such further acts as may be necessary or proper
in the reasonable opinion of Lender to carry out more effectively
the provisions and purposes of this Agreement or any other Loan
Document. Notwithstanding anything herein to the contrary, no
Credit Party shall be required to deliver any warehouse receipts
or bills of lading to Lender unless requested by the Lender in
writing at a time when a Default or Event of Default is then in
existence.
5.10 Additional Subsidiary Guarantors. Promptly (and in any
event within five (5) Business Days) after the creation or
acquisition of any Domestic Subsidiary of Borrower (other than
the Receivables Subsidiary), Borrower shall cause to be executed
and delivered, (i) by such new Domestic Subsidiary, a supplement
to the Subsidiary Guaranty in substantially the form of Schedule
1 to the Subsidiary Guaranty, (ii) by such new Subsidiary, an
Acknowledgement to the Security Agreement in substantially the
form of Exhibit B to the Security Agreement, and (iii) such other
related documents (including closing certificates and legal
opinions) as Lender may reasonably request, all in form and
substance reasonably satisfactory to Lender.
5.11 Certain Covenants Relating to the Collateral. The Credit
Parties shall cause the following requirements to be fulfilled
with respect to each of the Mortgaged Properties to the extent
such requirements have not been fulfilled pursuant to Annex B or
Section 2.3.
(a) By no later than November 2, 2001, each Credit Party shall
have (i) executed and delivered to Lender a Mortgage covering all
of the Second Group of Mortgaged Properties, in proper form for
recordation recorded in all places to the extent necessary to
create a valid and enforceable first priority lien (subject to
Permitted Encumbrances) on such Second Group of Mortgaged
Property in favor of Lender (or in favor of such other trustee as
may be required or desired under local law) and otherwise in form
and substance satisfactory to Lender, (ii) delivered to Lender
evidence that counterparts of all of the Mortgages referred to in
clause (i) above of this Section 5.11(a) have been recorded in
all places to the extent necessary to create a valid and
enforceable first priority lien (subject to Permitted
Encumbrances) on all of the Second Group of Mortgaged Property
owned by such Credit Party in favor of Lender (or in favor of
such other trustee as may be required or desired under local
law), (iii) delivered to Lender an opinion of counsel in each
state in which any of the Second Group of Mortgaged Property is
located regarding the Mortgages on such properties in form and
substance and from counsel satisfactory to Lender, (iv) fully
cooperated with Lender by providing Lender and/or its consultants
and agents with access to, and information concerning, all of the
Second Group of Mortgaged Properties as may be requested by
Lender (or such consultant or agent of Lender) and as may be
necessary to ensure completion by November 2, 2001 of Phase I
Environmental Site Assessment Reports, consistent with American
Society for Testing and Materials (ASTM) Standard E 1527-94 and
applicable state requirements, on all of the Second Group of
Mortgaged Properties, dated no more than 6 months prior to the
Closing Date, prepared by environmental engineers satisfactory to
Lender, all in form and substance satisfactory to Lender, in its
sole discretion; and (v) fully cooperated with Lender by
providing Lender and/or its consultants and agents with access
to, and information concerning, all of the Second Group of
Mortgaged Properties as may be requested by Lender (or such
consultant or agent of Lender) and as may be necessary to ensure
delivery to Lender by no later than November 2, 2001 of letters
executed by the environmental firms preparing the environmental
reports referred to in clause (iv) of this Section 5.11(a), in
form and substance satisfactory to Lender, authorizing Lender to
rely on such reports.
(b) By no later than November 9, 2001, each Credit Party shall
have (i) executed and delivered to Lender a Mortgage covering all
of the Third Group of Mortgaged Properties, in proper form for
recordation in all places to the extent necessary to create a
valid and enforceable first priority lien (subject to Permitted
Encumbrances) on such Third Group of Mortgaged Property in favor
of Lender (or in favor of such other trustee as may be required
or desired under local law) and otherwise in form and substance
satisfactory to Lender, provided that such Mortgages shall not be
recorded by Lender until such time as (x) Borrower has made a
request for a Revolving Credit Advance which if made would result
in the aggregate outstanding principal balance of all Revolving
Credit Advances exceeding $25,000,000 and (y) all of the
conditions set forth in Section 2.3 (other than the condition
requiring recordation of said Mortgage) have been satisfied in
full or waived by the Lender in writing, (ii) delivered to Lender
an opinion of counsel in each state in which any of the Third
Group of Mortgaged Property is located in form and substance and
from counsel satisfactory to Lender, (iii) fully cooperated with
Lender by providing Lender and/or its consultants and agents with
access to, and information concerning, all of the Third Group of
Mortgaged Properties as may be requested by Lender (or such
consultant or agent of Lender) and as may be necessary to ensure
completion by November 9, 2001 delivered to Lender Phase I
Environmental Site Assessment Reports, consistent with American
Society for Testing and Materials (ASTM) Standard E 1527-94 and
applicable state requirements, on all of the Third Group of
Mortgaged Properties, dated no more than 6 months prior to the
Closing Date, prepared by environmental engineers satisfactory to
Lender, all in form and substance satisfactory to Lender, in its
sole discretion; and (iv) fully cooperated with Lender by
providing Lender and/or its consultants and agents with access
to, and information concerning, all of the Third Group of
Mortgaged Properties as may be requested by Lender (or such
consultant or agent of Lender) and as may be necessary to ensure
delivery to Lender by no later than November 9, 2001 of letters
executed by the environmental firms preparing the environmental
reports referred to in clause (iii) of this Section 5.11(b), in
form and substance satisfactory to Lender, authorizing Lender to
rely on such reports.
(c) (i) By no later than November 9, 2001, each Credit Party
shall have delivered to Lender commitments for title insurance
coverage, in form and scope satisfactory to Lender, in a total
amount of not less than $100,000,000 for all of the Mortgaged
Properties with an allocation on a per Mortgaged Property basis
to be acceptable to Lender in its sole discretion; and Borrower
shall, by one Business Day prior to the Post-Closing Borrowing
Date, purchase such title insurance coverage and deliver to
Lender, evidence of same acceptable to Lender.
(d) By no later than November 23, 2001, the Borrower shall have
(i) delivered to Lender current as-built surveys, zoning letters
(or zoning title endorsements) and certificates of occupancy with
respect to all of the Mortgaged Properties, in each case
satisfactory in form and substance to Lender, in its sole
discretion, and (ii) delivered to Lender updated fair market
value appraisals with respect to all of the Mortgaged Properties,
each of which shall be in form and substance satisfactory to
Lender.
(e) Each Credit Party agrees that at any time on and after the
Closing Date Lender shall be entitled to obtain, at such Credit
Party's sole cost and expense, (i) one or more updated written
fair market value appraisal reports and current as-built surveys
in respect of any of the Mortgaged Properties prepared by an
independent real estate appraiser and surveyor, as the case may
be, satisfactory to Lender, and (ii) such environmental review
and audit reports, including Phase II reports, with respect to
any of the Mortgaged Properties as Lender shall request, in each
case, in form and substance satisfactory to Lender; provided that
Lender shall not be entitled to obtain or request any of the
items described in clauses (i) or (ii) above unless Lender
believes in its reasonable credit judgment that either (x) a
Default or Event of Default has occurred and is continuing, or
(y) any of the information pertaining to the Mortgaged
Properties contained in any prior appraisal or environmental
report may be inaccurate or outdated in any material respect.
Each Credit Party shall cooperate with Lender in obtaining all
such environmental review and audits, updated appraisal reports
and surveys, including, without limitation, granting access to
the Mortgaged Properties to Lender and its agents, consultants
and representatives, and causing to be done such further acts as
may be necessary or proper in the reasonable opinion of Lender to
carry out more effectively the provisions and purposes of this
Section 5.11(d).
(f) Notwithstanding anything in Section 5.11 to the contrary,
should the Credit Parties be unable, despite good faith efforts,
to satisfy the environmental, title or opinion criteria set forth
in this Section 5.11 regarding any Mortgaged Property intended to
be included in the Second Group of the Mortgaged Properties or
the Third Group of Mortgaged Properties, the Credit Parties (i)
shall be obligated, in the case of the Second Group of Mortgaged
Properties, to provide other Mortgaged Properties for inclusion
in such groups, which properties shall be subject to Lender's
approval, in its sole discretion, and (ii) may, in the case of
the Third Group of Mortgaged Properties, provide other Mortgaged
Properties for inclusion in such groups, which properties shall
be subject to Lender's approval, in its sole discretion.
6. NEGATIVE COVENANTS
Each Credit Party executing this Agreement jointly and
severally agrees as to all Credit Parties that from and after the
date hereof until the Termination Date:
6.1 Mergers, Subsidiaries, Etc. No Credit Party shall directly
or indirectly, by operation of law or otherwise, (a) form or
acquire any Subsidiary, provided, however, that Borrower may form
a new Domestic Subsidiary to be known as "CF XxxxxX.xxx
Incorporated" so long as Borrower timely complies with all of the
requirements set forth in Section 5.10 relating thereto or (b)
merge with, consolidate with, acquire all or substantially all of
the assets or capital stock of, or otherwise combine with or
acquire, any Person; provided that the provisions of this Section
6.1 shall not prohibit (i) the formation of the Receivables
Subsidiary, (ii) the merger, consolidation or other combination
of any Subsidiary of Borrower (other than the Receivables
Subsidiary) with Borrower or any other Credit Party (other than
the Receivables Subsidiary) so long as (A) in the case of any
merger, consolidation or other combination involving the
Borrower, the Borrower is the surviving entity (B) in the case of
any merger, consolidation or other combination involving CF
Delaware, CF Delaware is the surviving entity and (C) in the case
of any merger, consolidation or other combination involving any
Credit Party (other than the Borrower or CF Delaware), a Credit
Party is the surviving entity or the Target becomes a wholly-
owned Subsidiary of a Credit Party and complies with the
requirements of Section 5.10, or (iii) the sale of all or
substantially all of the assets or capital stock of any
Subsidiary of Borrower (other than CF Delaware or the Receivables
Subsidiary) to Borrower or any other Subsidiary of Borrower
(other than the Receivables Subsidiary or any of the Foreign
Subsidiaries), or (iv) the sale or contribution of CF Delaware's
Receivables Assets pursuant to the Receivables Sale and
Contribution Agreement.
Notwithstanding the foregoing, any Credit Party, may
acquire all or substantially all of the assets or capital Stock
of any Person (the "Target") (in each case, a "Permitted
Acquisition") subject to the satisfaction of each of the
following conditions:
(i) the Lender shall have received at least 30 days'
prior written notice of the proposed Permitted Acquisition;
(ii) the business acquired shall only be of the type
engaged by the Borrower or its Subsidiaries or such other
business as may be reasonably related thereto,
(iii) the Permitted Acquisition shall be consensual
and approved by the Target's Board of Directors;
(iv) the Acquisition Price payable in connection with
such Permitted Acquisitions, together with the aggregate
Acquisition Price paid in connection with all other Permitted
Acquisitions consummated during the Fiscal Year, shall not exceed
$25,000,000;
(v) the business and assets acquired in such Permitted
Acquisitions shall be free and clear of all Liens (other than
Permitted Encumbrances);
(vi) (A) in the case of any merger, consolidation or
other combination involving the Borrower, the Borrower is the
surviving entity (B) in the case of any merger, consolidation or
other combination involving CF Delaware, CF Delaware is the
surviving entity and (C) in the case of any merger, consolidation
or other combination involving any Credit Party (other than the
Borrower or CF Delaware), a Credit Party is the surviving entity
or the Target becomes a wholly-owned Subsidiary of a Credit Party
and complies with the requirements of Section 5.10;
(vii) the Lender shall have received a proforma
balance sheet and income statement and cash flow statement of the
Borrower and its Subsidiaries ("Acquisition ProForma") based on
the most recent financial statements which shall be complete and
shall fairly present the financial condition of the Borrower and
its Subsidiaries taking into account such Permitted Acquisition,
and such Acquisition ProForma shall reflect that (A) the average
aggregate daily Excess Liquidity for the 60 day period preceding
the consummation of such Permitted Acquisition would have
exceeded $25,000,000 on a proforma basis and (B) after giving
effect to such acquisition, Borrower would have been in
compliance with the required financial covenants for the four
quarter period reflected in the compliance certificate most
recently delivered to Lender prior to the consummation of the
proposed acquisition;
(viii) the Lender shall have received a balance
sheet and income statement and cash flow statement projections of
the Borrower and its Subsidiaries, which shall reflect that such
average aggregate daily Excess Liquidity, after giving effect to
payment of accounts payable (including those assumed in
connection with such Permitted Acquisition) consistent with past
practices, of at least $25,000,000 shall continue for at least 60
days after the consummation of such Permitted Acquisition;
(ix) no additional indebtedness, guaranteed
indebtedness, contingent obligations or other liabilities shall
be incurred, assumed or otherwise be reflected on a consolidated
balance sheet of such Credit Party and Target after giving effect
to such Permitted Acquisition, except (A) ordinary course trade
payables and accrued expenses (to the extent of current assets
being acquired of the Target), (B) unsecured indebtedness of the
Target (to the extent no Default or Event of Default shall have
occurred and be continuing or would result after giving effect to
such Permitted Acquisition) and (C) other Indebtedness incurred
by a Credit Party in connection with such acquisition to the
extent such Indebtedness is expressly permitted to be incurred
under Section 6.3;
(x) the Lender shall have received a draft copy of the
acquisition agreement and within one Business Days after
consummation of such acquisition a copy of the final acquisition
agreement; and
(xi) at the time and after giving effect to such
Permitted Acquisition, no Default or Event of Default shall have
occurred and be continuing.
Notwithstanding anything herein to the contrary, the
requirements of clauses (i), (vii) and (viii) above shall not
apply to any acquisition made in any particular Fiscal Year if
the sum of the Acquisition Price payable in connection therewith
plus the aggregate Acquisition Prices payable in connection with
all other acquisitions by any Credit Parties made in such Fiscal
Year without compliance with such clauses (i), (vii) and (viii)
does not exceed $2,500,000.
6.2 Investments; Reimbursement Obligations and Advances. Except
as otherwise expressly permitted by this Section 6.2, no Credit
Party shall make or permit to exist any Investment in any Person,
except that (a) each Credit Party may maintain its Investments as
of the Closing Date in Persons other than Subsidiaries described
on Disclosure Schedule (6.2); (b) each Credit Party may hold
Investments comprised of notes payable, or stock or other
securities issued by Account Debtors to Credit Party pursuant to
negotiated agreements with respect to settlement of such Account
Debtor's Accounts in the ordinary course of business, so long as
the aggregate amount of such Accounts so settled by Credit Party
does not exceed $1,000,000; (c) (i) each Credit Party may
maintain its existing Investments in its respective Subsidiaries
as of the Closing Date, (ii) any Credit Party may make additional
Investments after the Closing Date to any Domestic Subsidiary,
provided that such Domestic Subsidiary has become a Subsidiary
Guarantor as required under this Agreement and (iii) Credit
Parties may invest up to $1,000 in a new Domestic Subsidiary to
be known as "CF XxxxxX.xxx Incorporated" prior to the date such
Subsidiary becomes a Subsidiary Guarantor hereunder; (d) loans
and advances made to customers, vendors and employees of any
Credit Party in the ordinary course of business in an aggregate
outstanding principal balance for all such loans and advances not
to exceed at any time $1,000,000; (e) so long as no Default or
Event of Default shall have occurred and be continuing any Credit
Party may make other Investments, in (i) marketable direct
obligations issued or unconditionally guaranteed by the United
States of America or any agency thereof maturing within one year
from the date of acquisition thereof, (ii) commercial paper
maturing no more than one year from the date of creation thereof
and currently having the highest rating obtainable from either
Standard & Poor's Rating Group or Xxxxx'x Investors Service,
Inc., (iii) certificates of deposit, maturing no more than one
year from the date of creation thereof, issued by commercial
banks incorporated under the laws of the United States of
America, each having combined capital, surplus and undivided
profits of not less than $300,000,000 and having a senior
unsecured rating of "A" or better by a nationally recognized
rating agency (an "A Rated Bank"), (iv) time deposits, maturing
no more than 30 days from the date of creation thereof with A
Rated Banks and (v) mutual funds that invest solely in one or
more of the investments described in clauses (i) through (iv)
above; (f) CF Delaware may make capital contributions to
Receivables Subsidiary; (g) after the Closing Date each Credit
Party may make Investments in one or more Foreign Subsidiaries
and Designated Entities provided that (i) no Event of Default has
occurred and is continuing or would result from such Investment
in a Foreign Subsidiary or Designated Entity and (ii) the sum of
the (A) aggregate net amount of Investments made after the
Closing Date by all Credit Parties in such Foreign Subsidiaries
and Designated Entities plus (B) all Guaranteed Indebtedness
covered by Section 6.6(f) does not, and would not as a result of
such Investment, exceed $8,000,000 at any time, provided that for
purposes of determining the net amount of Investments in Foreign
Subsidiaries at any one time under this clause (g), all cash
dividends or distributions received by the Credit Parties from
any Foreign Subsidiary after the Closing Date and the outstanding
principal balance of any Indebtedness owing by such Credit Party
to such Foreign Subsidiary at such time shall be deducted from
the amount of the Investments made by the Credit Parties after
the Closing Date; (h) each Credit Party may acquire interests in
other Persons to the extent permitted by Section 6.1 or make loan
or advances to other Affiliates to the extent permitted by
Section 6.4; and (i) any Credit Party may make loans to another
Credit Party so long as such loans are evidenced by one or more
promissory notes and such loans are expressly subordinated to the
Obligations in form and substance satisfactory to Lender.
6.3 Indebtedness. No Credit Party shall create, incur, assume
or permit to exist any Indebtedness, except (without duplication)
(a) the Reimbursement Obligations and the other Obligations, (b)
unfunded pension fund and other employee benefit plan obligations
and liabilities to the extent they are permitted to remain
unfunded under applicable law, (c) existing Indebtedness
described in Disclosure Schedule (6.3), (d) Indebtedness owing
under the Receivables Funding Documents, (e) Indebtedness
consisting of guarantees resulting from endorsement of negotiable
instruments for collection by any Credit Party in the ordinary
course of business, (f) Guaranteed Indebtedness permitted by
Section 6.6, (g) intercompany loans by Borrower or any of its
Subsidiaries to a Credit Party, provided that such loans are
expressly subordinated to the Obligations pursuant to written
terms in form and substance satisfactory to Lender, (h)
Indebtedness of Credit Parties consisting of Investments
permitted under Section 6.2, (i) Indebtedness secured by Liens to
the extent permitted by Section 6.7(b) or (c), (j) the CFRM
Secured Debt, (k) the Vancouver Secured Debt, (l) the Additional
Secured Debt, (m) the Term Debt and the Sale-Leaseback Debt,
provided that the entire Net Proceeds from each of the Term Debt
and the Sale-Leaseback Debt are immediately upon receipt by
Borrower (i) applied by Borrower to the repayment of Borrower's
outstanding Letter of Credit Obligations with respect to any
outstanding drawings under Letters of Credit and/or (ii)
distributed to the Receivables Subsidiary for immediate
application to the repayment of the outstanding Receivables
Advances, and (n) any extensions, renewals, amendments or
refinancings of any of the foregoing Indebtedness which, in the
case of any of the Indebtedness described in clauses (c), (i),
(j), (k), (l) or (m) above does not have the effect of increasing
the principal amount thereof above any applicable limit provided
herein or changing the amortization or final maturity date
thereof (other than to extend the same), provided that (i) the
aggregate outstanding principal amount of the Term Debt, the Sale-
Leaseback Debt (which for purposes hereof shall be the imputed
principal amount thereof), the Vancouver Secured Debt and the
Additional Secured Debt may not exceed $125,000,000 (or, in the
event that the Vancouver Property is leased by Borrower or its
Subsidiaries, plus the excess of the capitalized value of such
lease over the Net Proceeds of such lease) at any one time, and
(ii) each of the Vancouver Secured Debt, the Additional Secured
Debt, the Sale-Leaseback Debt and the Term Debt may only be
incurred if, at the time of and after giving effect to the
incurrence of any such Indebtedness, (A) no Default or Event of
Default shall exist, and (B) the Borrower shall be in compliance
with the minimum Fixed Charge Coverage Ratio covenant set forth
in part (a) of Annex D for the Adjusted Rolling Period (defined
below) as determined on a pro forma basis such that (I) the
subject Indebtedness to be incurred shall be deemed to have been
incurred on the first day of such Adjusted Rolling Period, (II)
EBITDA, cash taxes and Fixed Charges of the Borrower and its
Subsidiaries for the Testing Quarter (defined below) shall be
determined based upon financial projections of the Borrower
delivered to Lender on or immediately prior to the date of
incurrence of such Indebtedness, which projections Borrower
believes to be reasonable and fair in light of current conditions
and current facts known to Borrower and as of the date of
delivery of such projections reflect Borrower's good faith and
reasonable estimates of the future financial performance of
Borrower and its Subsidiaries for the Testing Quarter after
giving effect to such Indebtedness on a pro forma basis, and
(III) such projections and the assumptions used in preparing the
same are subject to approval by the Lender and such approval
shall not be unreasonably withheld or delayed. As used herein,
the term "Adjusted Rolling Period" shall mean and include the
three (3) Fiscal Quarters immediately preceding the Fiscal
Quarter in which the subject Indebtedness is incurred (the
"Testing Quarter") together with the Testing Quarter.
6.4 Employee Reimbursement Obligations and Affiliate
Transactions. Except as otherwise expressly permitted in this
Section 6.4 with respect to Affiliates, no Credit Party shall
enter into or be a party to any transaction with any other Credit
Party or any Affiliate thereof except for transactions (i) in the
ordinary course of and pursuant to the reasonable requirements of
such Credit Party's business and upon fair and reasonable terms
that are no less favorable to such Credit Party than would be
obtained in a comparable arm's length transaction with a Person
not an Affiliate of such Credit Party, (ii) pursuant to and in
accordance with the terms of the Receivables Funding Documents,
or (iii) intercompany loans to Credit Parties to the extent
expressly permitted under Section 6.3.
6.5 Capital Structure and Business. No Credit Party shall (a)
make any changes in any of its business objectives, purposes or
operations which could in any way adversely affect the repayment
of the Loans or any of the other Obligations or could reasonably
be expected to have or result in a Material Adverse Effect, (b)
make any change in its capital structure as described on
Disclosure Schedule (3.8), including the issuance of any shares
of Stock, warrants or other securities convertible into Stock or
any revision of the terms of its outstanding Stock, except for
the issuance by Borrower of shares of its Stock so long as such
Stock is not subject to any mandatory redemption provisions and
the issuance thereof would not result in a Change of Control or
(c) amend its charter or bylaws in a manner which would adversely
affect Lender or such Credit Party's duty or ability to repay the
Obligations. No Credit Party shall engage in any business other
than the businesses currently engaged in by it or businesses
reasonably related thereto.
6.6 Guaranteed Indebtedness. No Credit Party shall create,
incur, assume or permit to exist any Guaranteed Indebtedness
except (a) for the Obligations, (b) by endorsement of instruments
or items of payment for deposit to the general account of any
Credit Party, (c) any Guaranteed Indebtedness under the
Receivables Funding Documents, (d) for Guaranteed Indebtedness
incurred for the benefit of any other Credit Party if the primary
obligation is expressly permitted by this Agreement, (e) for
Guaranteed Indebtedness existing on the date of this Agreement
and listed on Disclosure Schedule (6.6), and (f) Indebtedness of
Foreign Subsidiaries so long as the sum of the aggregate
outstanding principal amount of all such Guaranteed Indebtedness
together with the aggregate net amount of all Investments made by
any Credit Parties after the Closing Date in Foreign Subsidiaries
and Designated Entities pursuant to (and determined in accordance
with) Section 6.2(g) would not exceed $8,000,000 at any time.
6.7 Liens. No Credit Party shall create, incur, assume or
permit to exist Lien on or with respect to its Accounts or any of
its other properties or assets (whether now owned or hereafter
acquired) except for (a) Permitted Encumbrances; (b) Liens in
existence on the date hereof and summarized on Disclosure
Schedule (6.7); (c) Liens created after the date hereof by
conditional sale or other title retention agreements (including
Capital Leases) or in connection with purchase money Indebtedness
with respect to equipment and fixtures acquired by any Credit
Party in the ordinary course of business, involving the
incurrence of an aggregate amount of purchase money Indebtedness
and Capital Lease Obligations of not more than $10,000,000 during
any Fiscal Year for all such Liens (provided that such Liens
attach only to the assets subject to such purchase money debt or
Capital Lease and such Indebtedness is incurred within twenty
(20) days following such purchase and does not exceed 100% of the
purchase price of the subject assets); (d) Liens on the Vancouver
Property securing the Vancouver Secured Debt, provided that on or
before the attachment of such Liens, Borrower has delivered to
Lender a mortgagee waiver (or a landlord waiver if the Vancouver
Secured Debt constitutes a Capital Lease Obligation), duly
executed by the applicable mortgagee (or landlord if the
Vancouver Secured Debt constitutes a Capital Lease Obligation),
and in form and substance reasonably satisfactory to Lender, and
provided that such Liens shall not attach to any of the
Collateral; (e) Liens (whether by conventional mortgage or sale-
leaseback or otherwise) on any real estate or equipment owned by
any Credit Party securing the Additional Secured Debt provided
that such Liens do not attach to any of the Collateral, and Liens
(whether by conventional mortgage or sale-leaseback or otherwise)
on any real estate owned by the Borrower securing the Term Debt
or the Sale-Leaseback Debt provided that such Liens do not attach
to any Collateral and attach only to the real estate that is the
subject of such transaction, and (f) Liens securing the CFRM
Debt, provided that such Liens shall not attach to any of the
Collateral. In addition, no Credit Party shall become a party to
any agreement, note, indenture or instrument, or take any other
action, which would prohibit the creation of a Lien on any of its
properties or other assets in favor of Lender as additional
collateral for the Obligations, except (i) operating leases, (ii)
Capital Leases or Licenses which prohibit Liens upon the assets
that are subject thereto and (iii) the Receivables Funding
Documents and the Intercreditor Agreement.
6.8 Sale of Stock and Assets. Except as otherwise expressly
permitted in this Agreement, no Credit Party shall sell,
transfer, convey, assign or otherwise dispose of any of its
properties or other assets, including the capital Stock of any of
its Subsidiaries (whether in a public or a private offering or
otherwise) or any of their Accounts, other than (a) any sale or
disposition of personal property (other than personal property
constituting Collateral) in the ordinary course of business, (b)
any sale of assets (other than assets constituting Collateral)
pursuant to a transaction permitted by Section 6.1, (c) sales of
real estate for fair market value in exchange for similar
property complying with Section 1031 of the Internal Revenue
Code, (d) sales or other transfers of other assets (other than
assets constituting Collateral) by any Credit Party in any Fiscal
Year, together with all other sales or transfers of such assets
under this clause (d) in such Fiscal Year, with an aggregate book
value not in excess of five percent (5%) of the Consolidated
Total Assets of Borrower as of the end of the previous Fiscal
Year, (e) the sale, transfer or contribution of Receivables
Assets by CF Delaware to the Receivables Subsidiary, pursuant to
and in accordance with the Receivables Funding Documents, (f) the
sale of the Menlo Park Property, (g) the sale of the Terminal
Properties in the ordinary course of business, and (h) the sales
or transfers of real property in connection with the issuance of
any Sale-Leaseback Debt, provided that the aggregate net book
value of all such real property shall not exceed $50,000,000.
With respect to any disposition of assets or other properties
permitted pursuant to clauses (d) through (h) above, Lender
agrees on reasonable prior written notice to release any Lien
which Lender may have on such assets or other properties in order
to permit the applicable Credit Party to effect such disposition
and shall execute and deliver to Borrower, at Borrower's expense,
appropriate UCC-3 termination statements and other releases as
reasonably requested by Borrower.
6.9 ERISA. No Credit Party shall, or shall cause or permit any
ERISA Affiliate to, cause or permit to occur an event which could
result in the imposition of a Lien under Section 412 of the IRC
or Section 302 or 4068 of ERISA or cause or permit to occur an
ERISA Event to the extent such ERISA Event could reasonably be
expected to have a Material Adverse Effect.
6.10 Financial Covenants. Borrower shall not breach or fail to
comply with any of the Financial Covenants (the "Financial
Covenants") set forth in Annex D to this Agreement.
6.11 Hazardous Materials. No Credit Party shall cause or permit
a Release of any Hazardous Material on, at, in, under, above, to,
from or about any of the real estate where such Release would (a)
violate in any respect, or form the basis for any Environmental
Liabilities under, any Environmental Laws or Environmental
Permits or (b) otherwise adversely impact the value or
marketability of any of the real estate or any of the Collateral,
in each case, other than such violations or Environmental
Liabilities which (i) in the case of any Environmental Liability
which does not affect any of the Collateral, could not reasonably
be expected to have a Material Adverse Effect and (ii) in the
case of any Environmental Liability which does effect any of the
Collateral, could not reasonably be expected to result
individually or in the aggregate in a liability of the Credit
Parties in excess of $500,000.
6.12 Cancellation of Indebtedness. No Credit Party shall cancel
any claim or debt owing to it, except for reasonable
consideration negotiated on an arm's-length basis and in the
ordinary course of its business consistent with past practices.
6.13 Restricted Payments. No Credit Party shall make any
Restricted Payment, except (a) intercompany loans and advances
between Borrower and Subsidiaries (other than Foreign
Subsidiaries) of Borrower, and (b) dividends and distributions by
Subsidiaries of Borrower paid to a Credit Party. Notwithstanding
the foregoing, this Section 6.13 shall not prohibit payments by
Borrower to holders of Borrower's common Stock in connection with
repurchases of such Stock by Borrower ("Permitted Stock
Repurchases") so long as (i) Lender shall have received at least
30 Business Days' prior to any such proposed payment (A) a
written notice thereof, which shall include a reasonably detailed
description of such proposed payment, (B) a pro forma
consolidated balance sheet, income statement and cash flow
statement of Borrower and its Subsidiaries, based on recent
financial statements, which shall be complete and shall fairly
represent in all material respects the assets, liabilities,
financial condition and results of operations of Borrower and its
Subsidiaries in accordance with GAAP consistently applied, but
taking into account such proposed payment and such pro forma
statement shall reflect that the requirement set forth below have
been satisfied, and (C) a certificate of the chief financial
officer of Borrower to the effect that Borrower will be Solvent
after the proposed payment and that the pro forma statements
fairly present the financial condition of Borrower (on a
consolidated basis) as of the date thereof after giving effect to
the proposed payment, (ii) average daily Excess Liquidity for the
60-day period preceding the date of such proposed payment would
have exceeded $25,000,000 on a pro forma basis (giving effect to
such proposed payment), (iii) Excess Liquidity of $25,000,000
shall continue for at least 60 days after the consummation of
such proposed payment, (iv) no Event of Default shall have
occurred and be continuing or on a pro forma basis, would result
after giving effect to such proposed payment and Borrower would
have been in compliance with the required financial covenants for
the four quarter period reflected in the compliance certificate
most recently delivered to Lender prior to the consummation of
such proposed payment (after giving effect to such proposed
payment), (v) all Stock repurchased pursuant to this section
shall be immediately canceled and retired, except for Stock which
is contributed to the Credit Parties' employee benefit plans or
stock option plans, (vi) if the Stock being repurchased is not
contributed to the Credit Parties' employee benefit plans or
stock option plans, then the proposed payment therefor, together
with all other payments made in connection with other Permitted
Stock Repurchases made during such Fiscal Year in which the
repurchased shares were not so contributed, shall not exceed
$5,000,000, and (vii) if the Stock being repurchased is
contributed to the Credit Parties' employee benefit plans or
stock option plans, then the proposed payment therefor, together
with all other payments made in connection with other Permitted
Stock Repurchases made during such Fiscal Year in which the
repurchased shares were so contributed, shall not exceed
$3,000,000.
6.14 Change of Corporate Name or Location; Change of Fiscal Year.
No Credit Party shall (a) change its corporate name or the
jurisdiction of its incorporation or formation, or (b) change its
chief executive office, principal place of business, in any case
without at least thirty (30) days prior written notice to Lender
and after Lender's written acknowledgment that any reasonable
action requested by Lender in connection therewith, including to
continue the perfection of any Liens in favor of Lender in any
Collateral, has been completed or taken, and provided that any
such new location shall be in the continental United States.
Without limiting the foregoing, no Credit Party shall change its
name, identity or corporate structure in any manner which might
make any financing or continuation statement filed in connection
herewith seriously misleading within the meaning of Section 9-507
of the Code or any other then applicable provision of the Code
except upon prior written notice to Lender and after Lender's
written acknowledgment that any reasonable action requested by
Lender in connection therewith, including to continue the
perfection of any Liens in favor of Lender in any Collateral, has
been completed or taken. No Credit Party shall change its Fiscal
Year.
6.15 No Impairment of Intercompany Transfers. No Credit Party
shall directly or indirectly enter into or become bound by any
agreement, instrument, indenture or other obligation (other than
this Agreement, the other Loan Documents, the Receivables Funding
Documents, the Letter of Credit Documents and the Intercreditor
Agreement) which could directly or indirectly restrict, prohibit
or require the consent of any Person with respect to the payment
of dividends or distributions or the making or repayment of
intercompany loan by a Subsidiary of Borrower to Borrower.
6.16 No Speculative Transactions. No Credit Party shall engage
in any transaction involving commodity options, futures contracts
or similar transactions, except solely to hedge against
fluctuations in the prices of commodities owned or purchased by
it and the values of foreign currencies receivable or payable by
it and interest swaps, caps or collars.
6.17 Term Debt and Sale-Leaseback Debt. Except for regularly
scheduled lease payments on any Sale-Leaseback Debt, no Credit
Party shall make any payment or prepayment (partial or full) of
principal of any of the Term Debt or the Sale-Leaseback Debt,
Borrower shall not redeem or repurchase any of the Term Debt or
the Sale-Leaseback Debt or establish a sinking fund or the
equivalent for the Term Debt or the Sale-Leaseback Debt, and the
scheduled maturity date of the Term Debt or the Sale-Leaseback
Debt shall not be accelerated.
6.18 Certain Transactions. Notwithstanding anything in
this Agreement to the contrary, no Credit Party shall make,
grant, incur, enter into, or otherwise consummate any of the
following transactions on or after the Fourth Amendment Effective
Date without the prior written consent of the Lender: (i) any
Permitted Acquisition, (ii) any of the Term Debt, the Sale-
Leaseback Debt, the Vancouver Secured Debt, or the Additional
Secured Debt, (iii) any of the Liens described in Section 6.7(d)
or (e), (iv) any sale of the Menlo Park Property so long as it
constitutes part of the Collateral, or (v) any Permitted Stock
Repurchase.
7. TERM
7.1 Termination. The financing arrangements contemplated hereby
shall be in effect until the Commitment Termination Date, and the
Loans and all other Obligations (other then the Letter of Credit
Obligations and the Other Secured Obligations) shall be
automatically due and payable in full on such date.
7.2 Survival of Obligations Upon Termination of Financing
Arrangements. Except as otherwise expressly provided for in the
Loan Documents, no termination or cancellation (regardless of
cause or procedure) of any financing arrangement under this
Agreement shall in any way affect or impair the obligations,
duties and liabilities of the Credit Parties or the rights of
Lender relating to any unpaid portion of the Loans or any other
Obligations, due or not due, liquidated, contingent or
unliquidated or any transaction or event occurring prior to such
termination, or any transaction or event, the performance of
which is required after the Commitment Termination Date. Except
as otherwise expressly provided herein or in any other Loan
Document, all undertakings, agreements, covenants, warranties and
representations of or binding upon the Credit Parties, and all
rights of Lender, all as contained in the Loan Documents, shall
not terminate or expire, but rather shall survive any such
termination or cancellation and shall continue in full force and
effect until the Termination Date; provided, that the provisions
of Section 11, the payment obligations under Sections 1.11 and
1.12, and the indemnities contained in the Loan Documents shall
survive the Termination Date.
7.3 Termination and Release of Mortgages. On the Termination
Date so long as (i) no event of default (or other event which,
with the giving of notice or the passage of time, would become an
event of default) under the Other Credit Documents has occurred
and is then continuing and (ii) no Default or Event of Default
under (and as defined in) the Letter of Credit Agreement has
occurred and is then continuing, each of the Mortgages shall
terminate and the Lender shall promptly execute and deliver to
Borrower, at Borrower's expense, such releases and other
documents and instruments as may be necessary to evidence the
termination and release of such Mortgages.
8. EVENTS OF DEFAULT; RIGHTS AND REMEDIES
8.1 Events of Default. The occurrence of any one or more of the
following events (regardless of the reason therefor) shall
constitute an "Event of Default" hereunder:
(a) Borrower (i) fails to make any payment of principal of the
Loans or any other Obligations arising under this Agreement or
any of the other Loan Documents when due and payable and the same
shall remain unremedied for more than one (1) Business Day, (ii)
fails to make any payment of interest on, or Fees owing in
respect of, the Loans or any other Obligations arising hereunder
or under the other Loan Documents when due and payable and the
same shall remain unremedied for three (3) Business Days or more,
or (ii) fails to pay or reimburse Lender for any expense
reimbursable hereunder or under any other Loan Document within
five (5) days following Lender's demand for such reimbursement or
payment of expenses.
(b) Any Credit Party fails or neglects to perform, keep or
observe any of the provisions of Sections 1.3, 5.4 (to the extent
it deals with insurance covering any of the Collateral), 5.10,
5.11 or 6, or any of the provisions set forth in Annex D, or CF
Delaware shall fail or neglect to perform, keep or observe any of
the provisions of the second or fourth sentence of Section 17(a)
of the Subsidiary Guaranty.
(c) Borrower fails or neglects to perform, keep or observe any
of the provisions of Section 4 or any provisions set forth in
Annex C and the same shall remain unremedied for three (3) days
or more.
(d) Any Credit Party fails or neglects to perform, keep or
observe any other provision of this Agreement or of any of the
other Loan Documents (other than any provision embodied in or
covered by any other clause of this Section 8.1) and the same
shall remain unremedied for 15 days or more.
(e) A default or breach shall occur under any other agreement,
document or instrument to which any Credit Party is a party which
is not cured within any applicable grace period, and such default
or breach (i) involves the failure to make any payment when due
in respect of any Indebtedness (other than the Obligations) of
any Credit Party in excess of $10,000,000 in the aggregate, or
(ii) causes, or permits any holder of such Indebtedness or a
trustee to cause, Indebtedness or a portion thereof in excess of
$10,000,000 in the aggregate to become due prior to its stated
maturity or prior to its regularly scheduled dates of payment,
regardless of whether such default is waived, or such right is
exercised, by such holder or trustee.
(f) (i) Any information contained in any Borrowing Base
Certificate is untrue or incorrect in any respect, or (ii) any
representation or warranty herein or in any Loan Document or in
any written statement, report, financial statement or certificate
(other than a Borrowing Base Certificate) made or delivered to
Lender by any Credit Party is untrue or incorrect in any material
respect as of the date when made or deemed made.
(g) Assets of any Credit Party with a fair market value of
$10,000,000 or more are attached, seized, levied upon or
subjected to a writ or distress warrant, or come within the
possession of any receiver, trustee, custodian or assignee for
the benefit of creditors of any Credit Party and such condition
continues for thirty (30) days or more.
(h) A case or proceeding is commenced against any Credit Party
seeking a decree or order in respect of such Credit Party (i)
under the Bankruptcy Code, as now constituted or hereafter
amended or any other applicable federal, state or foreign
bankruptcy or other similar law, (ii) appointing a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or
similar official) for such Credit Party or for any substantial
part of any such Credit Party's assets, or (iii) ordering the
winding-up or liquidation of the affairs of such Credit Party.
(i) Any Credit Party (i) files a petition seeking relief under
the Title 11 of the United States Code, as now constituted or
hereafter amended, or any other applicable federal, state or
foreign bankruptcy or other similar law, (ii) consents to or
fails to contest in a timely and appropriate manner the
institution of proceedings thereunder or the filing of any such
petition or the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) for such Credit Party or for
any substantial part of such Credit Party's assets, (iii) makes
an assignment for the benefit of creditors, or (iv) takes any
action in furtherance of any of the foregoing, or (v) admits in
writing its inability to, or is generally unable to, pay its
debts as such debts become due.
(j) A final judgment or judgments for the payment of money in
excess of $10,000,000 in the aggregate are at any time
outstanding against any one or more of the Credit Parties and the
same are not, within 30 days after the entry thereof, discharged
or execution thereof stayed or bonded pending appeal, or such
judgments are not discharged prior to the expiration of any such
stay.
(k) Any material provision of any Loan Document ceases to be
valid, binding and enforceable in accordance with its terms (or
any Credit Party shall challenge the enforceability of any Loan
Document or shall assert in writing, or engage in any action or
inaction based on any such assertion, that any provision of any
of the Loan Documents has ceased to be or otherwise is not valid,
binding and enforceable in accordance with its terms), or any
Lien created under any Loan Document ceases to be a valid and
perfected first priority Lien (except as otherwise permitted
herein or therein) in any of the Collateral purported to be
covered thereby.
(l) Any Change of Control shall occur.
(m) The Letter of Credit Commitment Termination Date, the
Termination Date (as defined in the Receivables Funding
Agreement) or any Termination Event (other than a Termination
Event under Section 9.01 (o) of the Receivables Funding Agreement
that occurs solely as a result of the Receivables Subsidiary
receiving an Election Notice) shall occur.
(n) Any Event of Default under and as defined in the Letter of
Credit Agreement occurs and is continuing.
(o) Any event of default under any of the Other Credit Documents
occurs and is continuing.
8.2 Remedies.
(a) If any Default or Event of Default has occurred and is
continuing, Lender may (i) without notice, suspend the Revolving
Loan Commitment with respect to additional Revolving Credit
Advances whereupon any further Revolving Credit Advances shall be
made or incurred in Lender's sole discretion so long as such
Default or Event of Default is continuing, and (ii) without
notice except as otherwise expressly provided herein, increase
the rate of interest applicable to the Loans to the Default Rate.
(b) If any Event of Default has occurred and is continuing,
Lender may, without notice, (i) terminate the Revolving Loan
Commitment with respect to additional Revolving Credit Advances;
(ii) declare all or any portion of the Obligations, including all
or any portion of any Loan to be forthwith due and payable, all
without presentment, demand, protest or further notice of any
kind, all of which are expressly waived by Borrower and each
other Credit Party; or (iii) exercise any rights and remedies
provided to Lender under the Loan Documents or at law or equity,
including all remedies provided under the Code; provided,
however, that upon the occurrence of an Event of Default
specified in Sections 8.1(h) or (i), the Revolving Loan
Commitment shall be immediately terminated and all of the
Obligations, including the Revolving Loan, shall become
immediately due and payable without declaration, notice or demand
by any Person.
8.3 Waivers by Credit Parties. Except as otherwise provided for
in this Agreement or by applicable law, each Credit Party waives:
(a) presentment, demand and protest and notice of presentment,
dishonor, notice of intent to accelerate, notice of acceleration,
protest, default, nonpayment, maturity, release, compromise,
settlement, extension or renewal of any or all commercial paper,
accounts, contract rights, documents, instruments, chattel paper
and guaranties at any time held by Lender on which any Credit
Party may in any way be liable, and hereby ratifies and confirms
whatever Lender may do in this regard, (b) all rights to notice
and a hearing prior to Lender's taking possession or control of,
or to Lender's replevy, attachment or levy upon, the Collateral
or any bond or security that might be required by any court prior
to allowing Lender to exercise any of its remedies, and (c) the
benefit of all valuation, appraisal and exemption laws.
9. PARTICIPATIONS
9.1 Participations.
(a) The Credit Parties signatory hereto consent to Lender's sale
of participations in, at any time or times, the Revolving Loan
Commitment or any portion thereof or interest therein to any
Eligible Transferee. Unless otherwise consented to in writing by
Borrower, Lender may only sell participations in the Revolving
Loan Commitment to an Eligible Transferee. Any participation by
Lender of all or any part of the Revolving Loan Commitment shall
be sold with the understanding that all amounts payable by
Borrower hereunder shall be determined as if Lender had not sold
such participation, and that the holder of any such participation
shall not be entitled to require Lender to take or omit to take
any action hereunder except actions directly affecting (i) any
reduction in the principal amount of, or interest rate or Fees
payable with respect to, any Loan in which such holder
participates, (ii) any extension of the scheduled amortization of
the principal amount of any Loan in which such holder
participates or the final maturity date thereof, and (iii) any
release of all or substantially all of the Collateral (other than
in accordance with the terms of this Agreement, the Collateral
Documents or the other Loan Documents). Solely for purposes of
Sections 1.9, 1.11 and 1.12, Borrower acknowledges and agrees
that a participation shall give rise to a direct obligation of
Borrower to the participant and the participant shall be
considered to be a "Lender". Except as set forth in the
preceding sentence neither Borrower nor any other Credit Party
shall have any obligation or duty to any participant.
(b) Each Credit Party executing this Agreement shall assist
Lender as reasonably required to enable Lender to effect any such
participation, including, if requested by Lender, the
participation of management in meetings with potential
participants. To the extent that such descriptions are correct,
complete and accurate, each Credit Party executing this Agreement
shall certify the correctness, completeness and accuracy of all
descriptions of the Credit Parties and their respective affairs
contained in any selling materials provided by it and all other
information provided by it and included in such materials.
(c) Lender may furnish any information concerning Credit Parties
in the possession of Lender from time to time to participants
(including prospective participants). Lender shall obtain from
participants confidentiality covenants substantially equivalent
to those contained in Section 11.8 hereof.
10. SUCCESSORS AND ASSIGNS
10.1 Successors and Assigns. This Agreement and the other Loan
Documents shall be binding on and shall inure to the benefit of
each Credit Party, Lender and their respective successors and
assigns (including, in the case of any Credit Party, a Borrower-
in-possession on behalf of such Credit Party), except as
otherwise provided herein or therein. Unless otherwise consented
to in writing by Borrower, Lender may only assign its rights
under this Agreement to an Eligible Transferee. Borrower may not
assign, transfer, hypothecate or otherwise convey its rights,
benefits, obligations or duties hereunder or under any of the
other Loan Documents without the prior express written consent of
Lender. Any such purported assignment, transfer, hypothecation
or other conveyance by any Credit Party without the prior express
written consent of Lender shall be void. The terms and
provisions of this Agreement are for the purpose of defining the
relative rights and obligations of each Credit Party and Lender
with respect to the transactions contemplated hereby and no
Person shall be a third party beneficiary of any of the terms and
provisions of this Agreement or any of the other Loan Documents.
11. MISCELLANEOUS
11.1 Complete Agreement; Modification of Agreement. The Loan
Documents constitute the complete agreement between the parties
with respect to the subject matter thereof and may not be
modified, altered or amended except as set forth in Section 11.2
below. Any letter of interest, commitment letter or fee letter
(other than the Fee Letter) between any Credit Party and Lender,
predating this Agreement and relating to a financing of
substantially similar form, purpose or effect shall be superseded
by this Agreement.
11.2 Amendments and Waivers. No amendment, modification,
termination or waiver of any provision of this Agreement or any
of the Note, or any consent to any departure by any Credit Party
therefrom, shall in any event be effective unless the same shall
be in writing and signed by Lender and Borrower. Upon
indefeasible payment in full in cash and performance of all of
the Obligations (other than indemnification Obligations),
termination of the Revolving Loan Commitment and a release of all
claims against Lender, and so long as no suits, actions
proceedings, or claims are pending or threatened against any
Indemnified Person asserting any damages, losses or liabilities
that are Indemnified Liabilities, Lender shall deliver to
Borrower termination statements, mortgage releases and other
documents necessary or appropriate to evidence the termination of
the Liens securing payment of the Obligations.
11.3 Fees and Expenses. Borrower shall reimburse Lender for all
out-of-pocket fees, costs and expenses (including the reasonable
fees and expenses of all of its counsel, advisors, consultants
and auditors or other advisors, including environmental and
management consultants and appraisers) incurred in connection
with the negotiation and preparation of the Loan Documents and
incurred in connection with:
(a) the forwarding to Borrower or any other Person on behalf of
Borrower by Lender of the proceeds of the any Loan;
(b) any amendment, modification or waiver of, or consent with
respect to, or termination of, any of the Loan Documents or
Related Transactions Documents or advice in connection with the
syndication and administration of the Loans made pursuant hereto
or its rights hereunder or thereunder;
(c) any litigation, contest, dispute, suit, proceeding or action
(whether instituted by Lender, Borrower or any other Person) in
any way relating to the Collateral, any of the Loan Documents or
any other agreement to be executed or delivered in connection
herewith or therewith, and whether as a party, witness or
otherwise) including any litigation, contest, dispute, suit,
case, proceeding or action, and any appeal or review thereof, in
connection with a case commenced by or against Borrower or any
other Person that may be obligated to Lender by virtue of the
Loan Documents; including any such litigation, contest, dispute,
suit, proceeding or action arising in connection with any work-
out or restructuring of the Loans during the pendency of one or
more Events of Default; provided that no Person shall be entitled
to reimbursement under this clause (c) in respect of any
litigation, contest, dispute, suit, proceeding or action to the
extent any of the foregoing results from such Person's gross
negligence or willful misconduct.
(d) any attempt to enforce any remedies of Lender against any or
all of the Credit Parties or any other Person that may be
obligated to Lender by virtue of any of the Loan Documents;
including any such attempt to enforce any such remedies in the
course of any work-out or restructuring of the Loans during the
pendency of one or more Events of Default;
(e) any workout or restructuring of the Loans during the
pendency of one or more Events of Default; and
(f) subject to any applicable limitation set forth in Section
1.10, efforts to (i) monitor the Loans or any of the other
Obligations, (ii) evaluate, observe or assess any of the Credit
Parties or their respective affairs, and (iii) verify, protect,
evaluate, assess, appraise, collect, sell, liquidate or otherwise
dispose of any of the Collateral;
including, as to each of clauses (a) through (f) above, all
reasonable attorneys' and other professional and service
providers' fees arising from such services and other advice,
assistance or representation, including those in connection with
any appellate proceedings; and all expenses, costs, charges and
other fees incurred by such counsel and others in any way or
respect arising in connection with or relating to any of the
events or actions described in this Section 11.3, all of which
shall be payable, on demand, by Borrower to Lender. Without
limiting the generality of the foregoing, such expenses, costs,
charges and fees may include: fees, costs and expenses of
accountants, environmental advisors, appraisers, investment
bankers, management and other consultants and paralegals; court
costs and expenses; photocopying and duplication expenses; court
reporter fees, costs and expenses; long distance telephone
charges; air express charges; telegram or telecopy charges;
secretarial overtime charges; and expenses for travel, lodging
and food paid or incurred in connection with the performance of
such legal or other advisory services.
11.4 No Waiver. Lender's failure, at any time or times, to
require strict performance by the Credit Parties of any provision
of this Agreement or any other Loan Documents shall not waive,
affect or diminish any right of Lender thereafter to demand
strict compliance and performance herewith or therewith. Any
suspension or waiver of an Event of Default shall not suspend,
waive or affect any other Event of Default whether the same is
prior or subsequent thereto and whether the same or of a
different type. None of the undertakings, agreements,
warranties, covenants and representations of any Credit Party
contained in this Agreement or any of the other Loan Documents
and no Default or Event of Default by any Credit Party shall be
deemed to have been suspended or waived by Lender, unless such
waiver or suspension is by an instrument in writing signed by an
officer of or other authorized employee of Lender and directed to
Borrower specifying such suspension or waiver.
11.5 Remedies. Lender's rights and remedies under this Agreement
shall be cumulative and nonexclusive of any other rights and
remedies that Lender may have under any other agreement,
including the other Loan Documents, by operation of law or
otherwise. Recourse to the Collateral shall not be required.
11.6 Severability. Wherever possible, each provision of this
Agreement and the other Loan Documents shall be interpreted in
such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement or any other Loan Document
shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement or such
other Loan Document.
11.7 Conflict of Terms. Except as otherwise provided in this
Agreement or any of the other Loan Documents by specific
reference to the applicable provisions of this Agreement, if any
provision contained in this Agreement conflicts with any
provision in any of the other Loan Documents, the provision
contained in this Agreement shall govern and control.
11.8 Confidentiality. Lender agrees to use commercially
reasonable efforts (equivalent to the efforts Lender applies to
maintain as confidential its own confidential information) to
maintain as confidential all confidential information provided to
it by the Credit Parties and designated as confidential for a
period of 2 years following receipt thereof, except that Lender
may disclose such information (a) to Persons employed or engaged
by Lender in evaluating, approving, structuring or administering
the Loans and the Revolving Loan Commitment; (b) to any bona fide
participant or potential participant that constitutes an Eligible
Transferee and has agreed to comply with the covenant contained
in this Section 11.8 (and any such bona fide participant or
potential participant may disclose such information to Persons
employed or engaged by them as described in clause (a) above);
(c) as required or requested by any Governmental Authority or
reasonably believed by Lender to be compelled by any court
decree, subpoena or legal or administrative order or process; (d)
as, on the advice of Lender's counsel, is required by law; (e) in
connection with the exercise of any right or remedy under the
Loan Documents or in connection with any Litigation to which
Lender is a party, or (f) that ceases to be confidential through
no fault of Lender. For purposes of this Section 11.8, all
financial projections and the names of the Credit Parties'
customers, shippers and consignees shall be deemed to be
designated as confidential by the Credit Parties.
11.9 GOVERNING LAW. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
ANY OF THE LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS
OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THE LOAN DOCUMENTS AND
THE OBLIGATIONS SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS MADE AND PERFORMED IN THAT STATE AND ANY APPLICABLE
LAWS OF THE UNITED STATES OF AMERICA. EACH CREDIT PARTY HEREBY
CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN
XXX XXXX XXXXXX, XXXX XX XXX XXXX, XXX XXXX SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN
THE CREDIT PARTIES AND LENDER PERTAINING TO THIS AGREEMENT OR ANY
OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS,
PROVIDED, THAT LENDER AND THE CREDIT PARTIES ACKNOWLEDGE THAT ANY
APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF NEW YORK COUNTY, CITY OF NEW YORK, NEW YORK AND,
PROVIDED, FURTHER NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR
OPERATE TO PRECLUDE LENDER FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE
COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO
ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF LENDER. EACH
CREDIT PARTY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT,
AND EACH CREDIT PARTY HEREBY WAIVES ANY OBJECTION THAT SUCH
CREDIT PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION,
IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY SUCH COURT. EACH CREDIT PARTY HEREBY WAIVES
PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS
ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED
OR CERTIFIED MAIL ADDRESSED TO SUCH CREDIT PARTY AT THE ADDRESS
SET FORTH IN ANNEX E OF THIS AGREEMENT AND THAT SERVICE SO MADE
SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH CREDIT PARTY'S
ACTUAL RECEIPT THEREOF OR 3 DAYS AFTER DEPOSIT IN THE UNITED
STATES MAILS, PROPER POSTAGE PREPAID.
11.10 Notices. Except as otherwise provided herein, whenever
it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be
given to or served upon any of the parties by any other parties,
or whenever any of the parties desires to give or serve upon any
other parties any communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration
or other communication shall be in writing and shall be deemed to
have been validly served, given or delivered (a) upon the earlier
of actual receipt and 3 Business Days after deposit in the United
States Mail, registered or certified mail, return receipt
requested, with proper postage prepaid, (b) upon transmission,
when sent by telecopy or other similar facsimile transmission
(with such telecopy or facsimile promptly confirmed by delivery
of a copy by personal delivery or United States Mail as otherwise
provided in this Section 11.10), (c) 1 Business Day after deposit
with a reputable overnight courier with all charges prepaid or
(d) when delivered, if hand-delivered by messenger, all of which
shall be addressed to the party to be notified and sent to the
address or facsimile number indicated on Annex E or to such other
address (or facsimile number) as may be substituted by notice
given as herein provided. The giving of any notice required
hereunder may be waived in writing by the party entitled to
receive such notice. Failure or delay in delivering copies of
any notice, demand, request, consent, approval, declaration or
other communication to any Person (other than Borrower or Lender)
designated in Annex E to receive copies shall in no way adversely
affect the effectiveness of such notice, demand, request,
consent, approval, declaration or other communication.
11.11 Section Titles. The Section titles and Table of
Contents contained in this Agreement are and shall be without
substantive meaning or content of any kind whatsoever and are not
a part of the agreement between the parties hereto.
11.12 Counterparts. This Agreement may be executed in any
number of separate counterparts, each of which shall collectively
and separately constitute one agreement.
11.13 WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN
CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY
AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND
THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY
(RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.
THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE
JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT
TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE, BETWEEN LENDER AND ANY CREDIT PARTY ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED AMONG THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY
OF THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS RELATED THERETO.
11.14 Press Releases and Related Matters. Each Credit Party
executing this Agreement agrees that neither it nor its
Affiliates will in the future issue any press releases or other
public disclosure using the name of GE Capital or its affiliates
or referring to this Agreement, the other Loan Documents or the
Related Transactions Documents without at least 2 Business Days'
prior notice to GE Capital and without the prior written consent
of GE Capital unless (and only to the extent that) such Credit
Party or Affiliate is required to do so under law and then, in
any event, such Credit Party or Affiliate will consult with GE
Capital before issuing such press release or other public
disclosure. Each Credit Party consents to the publication by
Lender of a tombstone or similar advertising material relating to
the financing transactions contemplated by this Agreement.
Lender reserves the right to provide to industry trade
organizations information necessary and customary for inclusion
in league table measurements.
11.15 Reinstatement. This Agreement shall remain in full
force and effect and continue to be effective should any petition
be filed by or against Borrower for liquidation or
reorganization, should Borrower become insolvent or make an
assignment for the benefit of any creditor or creditors or should
a receiver or trustee be appointed for all or any significant
part of Borrower's assets, and shall continue to be effective or
to be reinstated, as the case may be, if at any time payment and
performance of the Obligations, or any part thereof, is, pursuant
to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee of the
Obligations, whether as a "voidable preference," "fraudulent
conveyance," or otherwise, all as though such payment or
performance had not been made. In the event that any payment, or
any part thereof, is rescinded, reduced, restored or returned,
the Obligations shall be reinstated and deemed reduced only by
such amount paid and not so rescinded, reduced, restored or
returned.
11.16 Advice of Counsel. Each of the parties represents to
each other party hereto that it has discussed this Agreement and,
specifically, the provisions of Sections 11.9 and 11.13, with its
counsel.
11.17 No Strict Construction. The parties hereto have
participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if
drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement.
11.18 Appointment of Agent for Service of Process. BORROWER
HEREBY IRREVOCABLE APPOINTS CSC CORPORATION (THE "PROCESS
AGENT"), WITH AN OFFICE ON THE DATE HEREOF AT 00 XXXXX XXXXXX,
0XX XXXXX, XXXXXX, XX 00000-0000, AS ITS AGENT TO RECEIVE ON ITS
BEHALF SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY
OTHER PROCESS THAT MAY BE SERVED IN ANY ACTION OR PROCEEDING
COMMENCED BY LENDER. SUCH SERVICE MAY BE MADE BY MAILING OR
DELIVERING A COPY OF SUCH PROCESS TO BORROWER IN CARE OF THE
PROCESS AGENT AT THE ABOVE ADDRESS OF THE PROCESS AGENT, AND
BORROWER HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS
AGENT TO RECEIVE SUCH SERVICE ON ITS BEHALF.
IN WITNESS WHEREOF, this Credit Agreement has been duly
executed as of the date first written above.
BORROWER:
CONSOLIDATED FREIGHTWAYS
CORPORATION
By:/s/Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title:Executive Vice President and CFO
LENDER:
GENERAL ELECTRIC CAPITAL
CORPORATION
By:/s/Xxxxx Xxxxxxx
Name:Xxxxx Xxxxxxx
Duly Authorized Signatory
The following Persons are signatories to this Agreement
in their capacities as Credit Parties and not as Borrowers.
CREDIT PARTIES:
CONSOLIDATED FREIGHTWAYS
CORPORATION OF DELAWARE
By:/s/Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title:Executive Vice President and CFO
CF AIRFREIGHT CORPORATION
By:/s/Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title:Executive Vice President and CFO
REDWOOD SYSTEMS, INC.
By:/s/Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title:Executive Vice President and CFO
XXXXXX XXXXX XXXXXXX CORPORATION
By:/s/Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title:Executive Vice President and CFO
ANNEX A (Recitals)
to
CREDIT AGREEMENT
DEFINITIONS
Capitalized terms used in the Loan Documents shall have
(unless otherwise provided elsewhere in the Loan Documents) the
following respective meanings and all references to Sections,
Exhibits, Schedules or Annexes in the following definitions shall
refer to Sections, Exhibits, Schedules or Annexes of or to the
Agreement:
"Account Debtor" shall mean any Person who may become
obligated to any Credit Party under, with respect to, or on
account of, an Account.
"Accounting Changes" shall mean, with respect to any
Person, (a) changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion of
the Financial Accounting Standards Board of the American
Institute of Certified Public Accountants (or any successor
thereto or any agency with similar functions); (b) changes in
accounting principles concurred in by such Person's certified
public accountants; (c) purchase accounting adjustments under
A.P.B. 16 or 17 and EITF 88-16, and the application of the
accounting principles set forth in FASB 109, including the
establishment of reserves pursuant thereto and any subsequent
reversal (in whole or in part) of such reserves; and (d) the
reversal of any reserves established as a result of purchase
accounting adjustments.
"Accounts" shall mean all "accounts," as such term is
defined in the Code, now owned or hereafter acquired by any
Credit Party and, in any event, including (a) all accounts
receivable, other receivables, book debts and other forms of
obligations (other than forms of obligations evidenced by Chattel
Paper, Documents or Instruments) now owned or hereafter received
or acquired by or belonging or owing to any Credit Party, whether
arising out of goods sold or services rendered by it or from any
other transaction (including any such obligations which may be
characterized as an account or contract right under the Code),
(b) all of each Credit Party's rights in, to and under all
purchase orders or receipts now owned or hereafter acquired by it
for goods or services, (c) all of each Credit Party's rights to
any goods represented by any of the foregoing (including unpaid
sellers' rights of rescission, replevin, reclamation and stoppage
in transit and rights to returned, reclaimed or repossessed
goods), (d) all monies due or to become due to any Credit Party,
under all purchase orders and contracts for the sale of goods or
the performance of services or both by such Credit Party or in
connection with any other transaction (whether or not yet earned
by performance on the part of such Credit Party) now or hereafter
in existence, including the right to receive the proceeds of said
purchase orders and contracts, and (e) all collateral security
and guarantees of any kind, now or hereafter in existence, given
by any Person with respect to any of the foregoing.
"Acquisition Price" shall mean, with respect to any
acquisition transaction, the total purchase price paid or payable
in connection with such acquisition or series of related
acquisitions, including without limitation all cash, Stock or
other property paid or payable in connection therewith and all
indebtedness incurred or assumed in connection therewith.
"Additional Secured Debt" shall mean an Indebtedness of
the Borrower or any of the Credit Parties that (i) is in an
aggregate principal amount of not more than $60,000,000 at any
one time and (ii) secured by any Lien permitted under Section
6.7(e) of the Agreement.
"Adjusted Monthly LIBOR Index Rate" shall mean, for any
calendar month, a rate per annum equal to the LIBOR Rate two
Business Days prior to the beginning of such calendar month.
"Adverse Claim" shall mean any claim of ownership or
any Lien, other than any ownership interest or Lien created under
the Collateral Documents.
"Affiliate" means, with respect to any Person, (a) each
Person that, directly or indirectly, owns or controls, whether
beneficially, or as a trustee, guardian or other fiduciary, 10%
or more of the Stock having ordinary voting power in the election
of directors of such Person, (b) each Person that controls, is
controlled by or is under common control with such Person, (c)
each of such Person's executive officers, directors, joint
venturers and partners and (d) in the case of Borrower, the
immediate family members, spouses and lineal descendants of
individuals who are Affiliates of Borrower. For the purposes of
this definition, "control" of a Person shall mean the possession,
directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the
ownership of voting securities, by contract or otherwise;
provided, however, that the term "Affiliate" shall specifically
exclude Lender.
"Agreement" means the Credit Agreement by and among
Borrower, the other Credit Parties named therein and Lender, as
the same may be amended, supplemented, restated or otherwise
modified from time to time.
"Appendices" has the meaning ascribed to it in the
recitals to the Agreement.
"Applicable Margins" means collectively the Applicable
Unused Line Fee Margin, the Applicable Revolver Index Margin and
the Applicable Revolver LIBOR Margin.
"Applicable Revolver Index Margin" means the per annum
interest rate equal to two and one-half percent (2.50%).
"Applicable Revolver LIBOR Margin" means the per annum
interest rate equal to three and one-half percent (3.50%).
"Applicable Unused Line Fee Margin" means the per annum
fee equal to one-half of one percent (0.50%).
"Appraised Value" means, with respect to any Real
Property, the appraised fair market value of such Real Property
as set forth in the most recent written appraisal report prepared
by an independent real estate appraiser satisfactory to Lender,
which appraisal report shall be in form and substance
satisfactory to Lender.
Asset Disposition" means, with respect to any Person,
the sale, transfer or other disposition of assets (whether real,
personal or mixed) of such Person.
"Average Length Of Haul" means, for any period, the sum
of all miles in respect of Shipments moved divided by the number
of Shipments for such period.
"Bankruptcy Code" means the provisions of Title 11 of
the United States Code, 11 U.S.C. 101 et seq.
"Billed Revenue" means for any period, the total gross
billing for all Less Than Truckload Shipments to customers.
"Billed Fuel Surcharges" means, for any period, the
total fuel surcharges billed to customers in such period.
"Block Account Agreement" shall have the meaning given
to such term in Section 17 of the Subsidiary Guaranty.
"Borrower" has the meaning ascribed to it in the
recitals to the Agreement.
"Borrowing Availability" means as of any date of
determination, the lesser of (i) the Maximum Amount and (ii) the
Borrowing Base, in each case, less the outstanding principal
balance of the Revolving Loan.
"Borrowing Base" shall mean, as of any date of
determination by Lender, from time to time, an amount equal to
the sum of (a) twenty-five percent (25%) of the Appraised Value
of Eligible Mortgaged Property less (b) any and all Reserves
established by Lender at such time including, without limitation,
Reserves for environmental remediation costs, accrued but unpaid
taxes, insurance and other Charges and expenses pertaining to
such Mortgaged Property. Notwithstanding the foregoing: (x) for
purposes of calculating the Borrowing Base, the advance rate in
clause (a) above of this definition shall be deemed to be (i)
fifty percent (50%) of the Appraised Value solely in respect of
the Mortgaged Property located at 000 Xxxxxxxx Xxxxx, Xxxxx Xxxx,
Xxxxxxxxxx for the period commencing on the Closing Date and
ending on November 2, 2001, and at all times on and after
November 3, 2001 shall be deemed to be equal to twenty-five
percent (25%) of the Appraised Value in respect of such Mortgaged
Property located at 000 Xxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx,
and (ii) thirty and one-tenth of one percent (30.1%) of the
Appraised Value solely in respect of the Mortgaged Property
located at 00000 Xxx Xxxxxxx Xxxx., Xxxxxxxxx, Xxxxxxxxx for the
period commencing on the Closing Date and ending on November 2,
2001 and at all times on and after November 3, 2001 shall be
deemed to be equal to twenty-five percent (25%) of the Appraised
Value in respect of such Mortgaged Property located at 00000 Xxx
Xxxxxxx Xxxx., Xxxxxxxxx, Xxxxxxxxx; (y) the Borrowing Base shall
not at any time exceed $15,000,000 if any of the conditions set
forth in Section 2.2 have not been satisfied in full or waived in
writing by Lender; and (z) the Borrowing Base shall not at any
time exceed $25,000,000 until all of the conditions set forth in
Section 2.3 have been satisfied in full or waived in writing by
Lender.
"Borrowing Base Certificate" means a certificate to be
executed and delivered from time to time by Borrower in the form
attached to the Agreement as Exhibit 4.1(b).
"Business Day" means any day that is not a Saturday, a
Sunday or a day on which banks are required or permitted to be
closed in the State of New York and in reference to LIBOR Loans
shall mean any such day that is also a LIBOR Business Day.
"Capital Lease" means, with respect to any Person, any
lease of any property (whether real, personal or mixed) by such
Person as lessee that, in accordance with GAAP, would be required
to be classified and accounted for as a capital lease on a
balance sheet of such Person.
"Capital Lease Obligation" means, with respect to any
Capital Lease of any Person, the amount of the obligation of the
lessee thereunder that, in accordance with GAAP, would appear on
a balance sheet of such lessee in respect of such Capital Lease.
"Cash Collateral Account Agreement" shall mean the Cash
Collateral Account Agreement (in the form of Exhibit 1.1(c)(i) to
the Letter of Credit Agreement) executed by Borrower pursuant to
Section 1.1(c)(i) of the Letter of Credit Agreement.
"CF Delaware" means Consolidated Freightways
Corporation of Delaware, a Delaware corporation.
"CFRM" shall mean CF Risk Management Services, Ltd., a
Bermuda company.
"CFRM Secured Debt" shall mean an Indebtedness of the
Borrower or any of the Subsidiary Guarantors to CFRM that (i) is
in an aggregate outstanding principal amount of not more than
$80,000,000 at any one time for the Borrower and Subsidiary
Guarantors combined, and (ii) is unsecured or is secured only by
a Lien permitted by Section 6.7 (f) of the Agreement.
"Change of Control" means any of the following: (a)
any person or group of persons (within the meaning of the
Securities Exchange Act of 1934, as amended) shall have acquired
beneficial ownership (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended) of 25% or more of
the issued and outstanding shares of capital Stock of Borrower
having the right to vote for the election of directors of
Borrower under ordinary circumstances; (b) during any period of
twelve consecutive calendar months ending after the Closing Date,
individuals who at the beginning of such period constituted the
board of directors of Borrower (together with any new directors
whose election by the board of directors of Borrower or whose
nomination for election by the stockholders of Borrower was
approved by a vote of a majority of the directors then still in
office who either were directors at the beginning of such period
or whose elections or nomination for election was previously so
approved) cease for any reason other than death or disability to
constitute a majority of the directors then in office; (c) the
Borrower shall cease to own and control all of the economic and
voting rights associated with all of the outstanding Stock of CF
Delaware or CF Delaware shall cease to own and control all of the
economic and voting rights associated with all of the outstanding
Stock of the Receivables Subsidiary, or (d) the Borrower has
sold, transferred, conveyed, assigned or otherwise disposed of
(i) all or substantially all of the assets of, or any of the
Stock of, CF Delaware or the Receivables Subsidiary or (ii) all
or substantially all of the assets of the Borrower in a
transaction not expressly permitted under Section 6.8.
"Charges" means all federal, state, county, city,
municipal, local, foreign or other governmental taxes (including
taxes owed to the PBGC at the time due and payable), levies,
assessments, charges, liens, claims or encumbrances upon or
relating to (a) the Collateral, (b) the Obligations, (c) the
employees, payroll, income or gross receipts of any Credit Party,
(b) any Credit Party's ownership or use of any properties or
other assets, or (e) any other aspect of any Credit Party's
business.
"Chattel Paper" means any "chattel paper," as such term
is defined in the Code, including electronic chattel paper, now
owned or hereafter acquired by any Credit Party, wherever
located.
"Closing Date" means October 24, 2001.
"Closing Checklist" means the schedule, including all
appendices, exhibits or schedules thereto, listing certain
documents and information to be delivered in connection with the
Agreement, the other Loan Documents and the transactions
contemplated thereunder, substantially in the form attached
hereto as Annex B.
"Code" shall mean the Uniform Commercial Code as the
same may, from time to time, be enacted and in effect in the
State of New York; provided, however, in the event that, by
reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of Lender's security interest
in any Collateral is governed by the Uniform Commercial Code as
enacted and in effect in a jurisdiction other than the State of
New York, the term "Code" shall mean the Uniform Commercial Code
as enacted and in effect in such other jurisdiction solely for
purposes of the provisions hereof relating to such attachment,
perfection or priority and for purposes of definitions related to
such provisions.
"Collateral" means the property covered by the
Mortgages and the other Collateral Documents and any other
property, real or personal, tangible or intangible, now existing
or hereafter acquired, that may at any time be or become subject
to a security interest or Lien in favor of Lender on behalf of
itself and/or its Affiliates to secure the Obligations.
"Collateral Documents" means the Security Agreement,
the Pledge Agreement, Guaranties, the Cash Collateral Account
Agreement, the Blocked Account Agreement, the Mortgages and all
similar agreements entered into guaranteeing payment of, or
granting a Lien upon property as security for payment of, the
Obligations.
"Commitment Termination Date" means the earliest of (a)
Xxxxx 00, 0000, (x) the date of termination of Lender's
obligation to make Revolving Credit Advances or permit existing
Loans to remain outstanding pursuant to Section 8.2(b), and (c)
the date of indefeasible prepayment in full by Borrower of the
Loans and other Obligations (other than Letter of Credit
Obligations and Other Secured Obligations) and the permanent
reduction of the Revolving Loan Commitment to zero dollars ($0).
"Compliance Certificate" has the meaning ascribed to it
in Annex C.
"Consolidated Total Assets" means, as of any date, the
consolidated total assets of the Borrower and its Subsidiaries as
of such date.
"Copyright License" means any and all rights now owned
or hereafter acquired by any Credit Party under any written
agreement granting any right to use any Copyright or Copyright
registration.
"Copyrights" means all of the following now owned or
hereafter adopted or acquired by any Credit Party: (a) all
copyrights and General Intangibles of like nature (whether
registered or unregistered), all registrations and recordings
thereof, and all applications in connection therewith, including
all registrations, recordings and applications in the United
States Copyright Office or in any similar office or agency of the
United States, any state or territory thereof, or any other
country or any political subdivision thereof, and (b) all
reissues, extensions or renewals thereof.
"Credit Parties" means Borrower and of its Subsidiaries
(other then the Receivables Subsidiary).
"Default" means any event that, with the passage of
time or notice or both, would, unless cured or waived, become an
Event of Default.
"Default Rate" has the meaning ascribed to it in
Section 1.4(d).
"Disclosure Schedules" means the Schedules prepared by
Borrower and denominated as Disclosure Schedules (3.2) through
(6.7) in the Index to the Agreement.
"Disbursement Direction Letter" shall have the meaning
assigned to it in Section 1.3(a).
"Documents" means all "documents," as such term is
defined in the Code, now owned or hereafter acquired by any
Credit Party, wherever located.
"Dollars" or "$" means lawful currency of the United
States of America.
"Domestic Subsidiary" shall mean any Subsidiary which
is incorporated or organized under the laws of any State of the
United States, the District of Columbia or Puerto Rico.
"Eligible Mortgaged Property" means and includes any
Mortgaged Property with respect to which Lender shall have
received each of the items described below in clauses (a) through
(e), and all such items shall be in form and substance
satisfactory to Lender in its sole discretion:
(a) fair market value appraisals as to the Mortgaged
Property prepared by an independent real estate appraiser
satisfactory to Lender;
(b) Mortgages duly executed by the appropriate Credit
Party, and evidence that a counterpart of the Mortgage has been
recorded in all places to the extent necessary to create a valid,
enforceable and perfected first-priority Lien (subject only to
Permitted Encumbrances) on the Mortgaged Property in a favor of
the Lender (or in favor of such trustee for the Lender as may be
required or desired under local law);
(c) Title Insurance Commitment/ALTA Policy insuring
the Mortgages as first priority liens (subject only to Permitted
Encumbrances), current as-built surveys, zoning letters (or
zoning title endorsements) and certificates of occupancy;
(d) Phase I Environmental Site Assessments conducted
by an independent environmental assessment company satisfactory
to Lender, together with any other environmental reports,
inspections or assessments as may be requested by Lender, and
Lender shall have received letters executed by the environmental
firms preparing such environmental reports, in form and substance
satisfactory to Lender, authorizing Lender to rely on such
reports; and
(e) an opinion of counsel in each state in which any
Mortgaged Property is located regarding the Mortgage on such
Mortgaged Property.
Notwithstanding the foregoing, if the fair market value or the
environmental status of any Mortgaged Property, or the priority
of the Lien of the Mortgages on any Mortgaged Property, adversely
changes at any time on or after the Closing Date then Lender, in
addition to any other rights it may have hereunder or under the
Loan Documents, shall be entitled to deem such Mortgaged Property
to be ineligible and/or establish such Reserves as it may deem
appropriate in its sole discretion.
"Eligible Transferee" shall mean (a) GE Capital or any
Subsidiary of GE Capital, (b) any commercial finance company, (c)
any bank or other financial institution, or (d) any other Person
that is not engaged in the less-than-truckload motor carrier or
freight transportation business.
"Environmental Laws" means all applicable federal,
state, local and foreign laws, statutes, ordinances, codes,
rules, standards and regulations, now or hereafter in effect, and
in each case as supplemented from time to time, and any
applicable judicial or administrative interpretation thereof,
including any applicable judicial or administrative order,
consent decree, order or judgment, imposing liability or
standards of conduct for or relating to the regulation and
protection of human health, safety, the environment and natural
resources (including ambient air, surface water, groundwater,
wetlands, land surface or subsurface strata, wildlife, aquatic
species and vegetation). Environmental Laws include the
Comprehensive Environmental Response, Compensation, and Liability
Act of 1980 (42 U.S.C. 9601 et seq.) ("CERCLA"); the Hazardous
Materials Transportation Authorization Act of 1994 (49 U.S.C.
5101 et seq.); the Federal Insecticide, Fungicide, and
Rodenticide Act (7 U.S.C. 136 et seq.); the Solid Waste
Disposal Act (42 U.S.C. 6901 et seq.); the Toxic Substance
Control Act (15 U.S.C. 2601 et seq.); the Clean Air Act (42
U.S.C. 7401 et seq.); the Federal Water Pollution Control Act
(33 U.S.C. 1251 et seq.); the Occupational Safety and Health
Act (29 U.S.C. 651 et seq.); and the Safe Drinking Water Act
(42 U.S.C. 300(f) et seq.), each as from time to time amended,
and any and all regulations promulgated thereunder, and all
analogous state, local and foreign counterparts or equivalents
and any transfer of ownership notification or approval statutes.
"Environmental Liabilities" means, with respect to any
Person, all liabilities, obligations, responsibilities, response,
remedial and removal costs, investigation and feasibility study
costs, capital costs, operation and maintenance costs, losses,
damages, punitive damages, property damages, natural resource
damages, consequential damages, treble damages, costs and
expenses (including all reasonable fees, disbursements and
expenses of counsel, experts and consultants), fines, penalties,
sanctions and interest incurred as a result of or related to any
claim, suit, action, investigation, proceeding or demand by any
Person, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute or common
law, including any arising under or related to any Environmental
Laws, Environmental Permits, or in connection with any Release or
threatened Release or presence of a Hazardous Material whether
on, at, in, under, from or about or in the vicinity of any real
or personal property.
"Environmental Permits" means all permits, licenses,
authorizations, certificates, approvals or registrations required
by any Governmental Authority under any Environmental Laws.
"ERISA" means the Employee Retirement Income Security
Act of 1974 (or any successor legislation thereto), as amended
from time to time, and any regulations promulgated thereunder.
"ERISA Affiliate" means, with respect to any Credit
Party, any trade or business (whether or not incorporated) that,
together with such Credit Party, are treated as a single employer
within the meaning of Sections 414(b), (c), (m) or (o) of the
IRC.
"ERISA Event" means, with respect to any Credit Party
or any ERISA Affiliate, (a) any event described in Section
4043(c) of ERISA with respect to a Title IV Plan; unless the
requirement of notice to the PBGC within 30 days of the event has
been waived; (b) the withdrawal of any Credit Party or ERISA
Affiliate from a Title IV Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (c) the complete or
partial withdrawal of any Credit Party or any ERISA Affiliate
from any Multiemployer Plan; (d) the filing of a notice of intent
to terminate a Title IV Plan or the treatment of a plan amendment
as a termination under Section 4041 of ERISA; (e) the institution
of proceedings to terminate a Title IV Plan or Multiemployer Plan
by the PBGC; (f) the failure by any Credit Party or ERISA
Affiliate to make when due required contributions to a
Multiemployer Plan or Title IV Plan unless such failure is cured
within 30 days; (g) any other event or condition which might
reasonably be expected to constitute grounds under Section 4042
of ERISA for the termination of, or the appointment of a trustee
to administer, any Title IV Plan or Multiemployer Plan or for the
imposition of liability under Section 4069 or 4212(c) of ERISA;
(h) the termination of a Multiemployer Plan under Section 4041A
of ERISA or the reorganization or insolvency of a Multiemployer
Plan under Section 4241 or 4245 of ERISA; (i) the loss of a
Qualified Plan's qualification or tax exempt status; or (j) the
termination of a Plan described in Section 4064 of ERISA.
"ESOP" means a Plan that is intended to satisfy the
requirements of Section 4975(e)(7) of the IRC.
"Event of Default" has the meaning ascribed to it in
Section 8.1.
"Excess Liquidity" shall have the meaning assigned to
such term in the Letter of Credit Agreement.
"Executive Officer" of any Person, means the chief
executive officer, president, chief financial officer, treasurer,
controller, general counsel or chief accounting officer of such
Person.
"Existing Credit Agreement" shall mean that certain
Credit Agreement dated as of October 12, 1999, by and among CF
Delaware, ABN Amro Bank N.V., as issuing bank and administrative
agent, and the lenders party thereto, as amended prior to the
Closing Date.
"Fair Labor Standards Act" means the Fair Labor
Standards Act, 29 U.S.C. 201 et seq.
"Federal Funds Rate" means, for any day, a floating
rate equal to the weighted average of the rates on overnight
Federal funds transactions among members of the Federal Reserve
System, as determined by Lender.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System, or any successor thereto.
"Fee Letter" means that certain fee letter dated
October 24, 2001 between Lender and Borrower.
"Fees" means any and all fees payable to Lender
pursuant to the Agreement or any of the other Loan Documents.
"Financial Covenants" means the Financial Covenants set
forth in Annex D.
"Financial Statements" means the consolidated and
consolidating income statements, statements of cash flows and
balance sheets of Borrower delivered in accordance with Section
3.4 of the Agreement and Annex C to the Agreement.
"First Group of Mortgaged Properties" means the
Mortgaged Properties identified on Annex F as being the "First
Group of Mortgaged Properties".
"Fiscal Month" means any of the monthly accounting
periods of Borrower.
"Fiscal Quarter" means any of the quarterly accounting
periods of Borrower.
"Fiscal Year" means any of the annual accounting
periods of Borrower ending on December 31 of each year.
"Foreign Subsidiaries" means any Subsidiary of Borrower
that is not a Domestic Subsidiary.
"Fifth Amendment to Letter of Credit Agreement" means
that certain Fifth Amendment to Letter of Credit Agreements dated
as of the date hereof, among Lender, Borrower and the Credit
Parties, which amends the Letter of Credit Agreement.
"Funded Debt" shall mean, with respect to any Person
(i) all Indebtedness for borrowed money evidenced by notes,
bonds, debentures, or similar evidences of Indebtedness, (ii) all
Sale-Leaseback Debt, (iii) any liability of such Person under any
so-called "synthetic" lease transaction and (iv) any obligation
arising with respect to any other transaction which is the
functional equivalent of or takes the place of borrowing but
which does not constitute a liability on the balance sheet of
such Person.
"Funding Office" shall mean the office of Lender in
which Loans are made by Lender.
"GAAP" means generally accepted accounting principles
in the United States of America as in effect on the Closing Date,
consistently applied as such term is further defined in Annex D
to the Agreement.
"GE Capital" means General Electric Capital
Corporation, a Delaware corporation.
"General Intangibles" means all "general intangibles,"
as such term is defined in the Code, now owned or hereafter
acquired by any Credit Party, including all right, title and
interest that such Credit Party may now or hereafter have in or
under any Contract, all payment intangibles, all customer lists,
Licenses, Copyrights, Trademarks, Patents, and all applications
therefor and reissues, extensions or renewals thereof, rights in
Intellectual Property, interests in partnerships, joint ventures
and other business associations, licenses, permits, copyrights,
trade secrets, proprietary or confidential information,
inventions (whether or not patented or patentable), technical
information, procedures, designs, knowledge, know-how, software,
data bases, data, skill, expertise, experience, processes,
models, drawings, materials and records, goodwill (including the
goodwill associated with any Trademark or Trademark License), all
rights and claims in or under insurance policies (including
insurance for fire, damage, loss and casualty, whether covering
personal property, real property, tangible rights or intangible
rights, all liability, life, key man and business interruption
insurance, and all unearned premiums), uncertificated securities,
choses in action, deposit, checking and other bank accounts,
rights to receive tax refunds and other payments, rights to
receive dividends, distributions, cash, Instruments, and other
Property in respect of or in exchange for pledged Stock and
Investment Property, rights of indemnification, all books and
records, correspondence, credit files, invoices and other papers,
including without limitation all tapes, cards, computer runs and
other papers and documents in the possession or under the control
of such Credit Party or any computer bureau or service company
from time to time acting for such Credit Party.
"Governmental Authority" means any nation or
government, any state or other political subdivision thereof, and
any agency, department or other entity exercising executive,
legislative, judicial, regulatory or administrative functions of
or pertaining to government.
"Gross LTL Rev/cwt" means, for any period (x) Billed
Revenue for such period less any portion of such Billed Revenue
relating to any Shipments into or out of Mexico less any Billed
Fuel Surcharges for such period, divided by (y) the total weight
of all Less Than Truckload Shipments for such period divided by
100.
"Guaranteed Indebtedness" means, as to any Person, any
obligation of such Person guaranteeing, any indebtedness, lease,
dividend, or other obligation ("primary obligation") of any other
Person (the "primary obligor") in any manner, including any
obligation or arrangement of such Person to (a) purchase or
repurchase any such primary obligation, (b) advance or supply
funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or
solvency or any balance sheet condition of the primary obligor,
(c) purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of
the ability of the primary obligor to make payment of such
primary obligation, or (d) indemnify the owner of such primary
obligation against loss in respect thereof. The amount of any
Guaranteed Indebtedness at any time shall be deemed to be an
amount equal to the lesser at such time of (x) the stated or
determinable amount of the primary obligation in respect of which
such Guaranteed Indebtedness is incurred and (y) the Revolving
Loan Commitment for which such Person may be liable pursuant to
the terms of the instrument embodying such Guaranteed
Indebtedness; or, if not stated or determinable, the maximum
reasonably anticipated liability (assuming full performance) in
respect thereof.
"Guaranties" means, collectively, each Subsidiary
Guaranty and any other guaranty executed by any Guarantor in
favor of Lender in respect of the Obligations.
"Guarantors" means each Domestic Subsidiary of Borrower
(other than the Receivables Subsidiary), and each other Person,
if any, that executes a guarantee or other similar agreement in
favor of Lender in connection with the transactions contemplated
by the Agreement and the other Loan Documents.
"Hazardous Material" means any substance, material or
waste that is regulated by, or forms the basis of liability now
or hereafter under, any Environmental Laws, including any
material or substance that is (a) defined as a "solid waste,"
"hazardous waste," "hazardous material," "hazardous substance,"
"extremely hazardous waste," "restricted hazardous waste,"
"pollutant," "contaminant," "hazardous constituent," "special
waste," "toxic substance" or other similar term or phrase under
any Environmental Laws, (b) petroleum or any fraction or
by-product thereof, asbestos, polychlorinated biphenyls (PCB's),
or any radioactive substance.
"Incipient Termination Event" shall mean an Incipient
Termination Event under (and as such term is defined in) Annex X
to the Receivables Funding Agreement.
"Indebtedness" of any Person shall mean without
duplication (a) all indebtedness of such Person for borrowed
money or for the deferred purchase price of property or services
payment for which is deferred six (6) months or more, but
excluding obligations to trade creditors incurred in the ordinary
course of business that are not overdue by more than six (6)
months unless being contested in good faith, (b) all
reimbursement and other obligations with respect to letters of
credit or bankers' acceptances whether or not matured, or with
respect to surety bonds on which a claim has been paid, (c) all
obligations evidenced by notes, bonds, debentures or similar
instruments issued or executed by such Person, (d) all
indebtedness created or arising under any conditional sale or
other title retention agreement with respect to property acquired
by such Person (even though the rights and remedies of the seller
or creditor under such agreement in the event of default are
limited to repossession or sale of such property), (e) all
Capital Lease Obligations, (f) all obligations of such Person
under commodity purchase or option agreements or other commodity
price hedging arrangements, in each case whether contingent or
matured, (g) all obligations of such Person under any foreign
exchange contract, currency swap agreement, interest rate swap,
cap or collar agreement or other similar agreement or arrangement
designed to alter the risks of that Person arising from
fluctuations in currency values or interest rates, in each case
whether contingent or matured, (h) all Indebtedness referred to
above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by)
any Lien upon or in property or other assets (including accounts
and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such
Indebtedness, (i) the Obligations, and (j) the Sale-Leaseback
Debt, the Term Debt, the Vancouver Secured Debt and the
Additional Secured Debt.
"Indemnified Liabilities" has the meaning ascribed to
it in Section 1.9.
"Indemnified Person" has the meaning ascribed to it in
Section 1.9.
"Index Rate" shall mean the latest rate for 30-day
dealer placed commercial paper (which for purposes hereof shall
mean high grade unsecured notes sold through dealers by major
corporations in multiples of $100,000), which normally is
published in the "Money Rates" section of The Wall Street Journal
(or if such rate ceases to be so published, as quoted from such
other generally available and recognizable independent source as
the Lender may reasonably select). Each change in any interest
rate provided for in this Agreement based upon the Index Rate
shall take effect at the time of such change in the Index Rate.
"Index Rate Loan" means a Loan or portion thereof
bearing interest by reference to the Index Rate.
"Initial Capital Contribution" has the meaning ascribed
to it in Section 1.3(a).
"Instruments" means all "instruments," as such term is
defined in the Code, now owned or hereafter acquired by any
Credit Party, wherever located, and, in any event, including all
certificated securities, all certificates of deposit, and all
notes and other, without limitation, evidences of indebtedness,
other than instruments that constitute, or are a part of a group
of writings that constitute, Chattel Paper.
"Intellectual Property" means any and all Licenses,
Patents, Copyrights, Trademarks and the goodwill associated with
such Trademarks.
"Intercreditor Agreement" shall mean the Intercreditor
Agreement dated as of April 27, 2001, among Borrower, the
Receivables Subsidiary, Borrower's other Subsidiaries, Lender,
and GE Capital (in various capacities), as such agreement may be
amended, supplemented, restated or replaced from time to time.
"Interest Payment Date" means the first Business Day of
each month to occur while such Loan is outstanding, provided,
further, that, in addition to the foregoing, each of (x) the date
upon which the Revolving Loan Commitment has been terminated and
the Loans have been paid in full and (y) the Commitment
Termination Date shall be deemed to be an "Interest Payment Date"
with respect to any interest that has then accrued under the
Agreement.
"IRC" means the Internal Revenue Code of 1986, as
amended, and any successor thereto.
"IRS" means the Internal Revenue Service, or any
successor thereto.
"Laden Load Factor" means, for any period, Pound Miles
for such period divided by Loaded Miles for such period.
"Lender" means GE Capital.
"Less Than Truckload Shipment" means any Shipment
weighing less than 10,000 pounds.
"Letter of Credit Agreement" means that certain Letter
of Credit Agreement dated as of April 27, 2001, between Lender
and Borrower, as amended, restated or supplemented from time to
time.
"Letter of Credit Blocked Account" means the Blocked
Account as such term is defined in the Letter of Credit
Agreement.
"Letter of Credit Blocked Account Agreement" means the
Blocked Account Agreement as such term is defined in the Letter
of Credit Agreement.
"Letter of Credit Blocked Account Bank" means the
Blocked Account Bank as such term is defined in the Letter of
Credit Agreement.
"Letter of Credit Collateral Documents" means the
Collateral Documents as such term is defined in the Letter of
Credit Agreement.
"Letter of Credit Documents" means, collectively, the
Letter of Credit Agreement and all other Letter of Credit
Documents as such term is defined in the Letter of Credit
Agreement (other than the Loan Documents), as amended, restated
or supplemented from time to time.
"Letter of Credit Obligations" means the Obligations as
such term is defined in the Letter of Credit Agreement.
"Letter of Credit Commitment Termination Date" means
the Commitment Termination Date as such term is defined in the
Letter of Credit Agreement.
"LIBOR Business Day" means a Business Day on which
banks in the city of London are generally open for interbank or
foreign exchange transactions.
"LIBOR Loan" means a Loan or any portion thereof
bearing interest by reference to the Adjusted Monthly LIBOR Index
Rate.
"LIBOR Period" means a calendar month, except that the
initial LIBOR Period in respect of the initial Revolving Credit
Advances to be made on the Closing Date shall commence on the
Closing Date and end on October 31, 2001. All or any portion of
a LIBOR Loan that remains outstanding at the expiration of the
applicable LIBOR Period shall be deemed automatically continued
(without any notice or action on the part of the Borrower or any
other Person) as a LIBOR Loan upon the expiration of the
applicable LIBOR Period.
"LIBOR Rate" means for each LIBOR Period, a rate of
interest determined by Lender equal to:
(a) the offered rate for deposits in United States
Dollars for the applicable LIBOR Period that appears on
Telerate Page 3750 as of 11:00 a.m., (London time) on the
second full LIBOR Business Day next preceding the first day
of such LIBOR Period (unless such date is not a Business
Day, in which event the next succeeding Business Day will be
used); divided by
(b) a number equal to 1.0 minus the aggregate (but
without duplication) of the rates (expressed as a decimal
fraction) of reserve requirements in effect on the day that
is 2 LIBOR Business Days prior to the beginning of such
LIBOR Period (including basic, supplemental, marginal and
emergency reserves under any regulations of the Federal
Reserve Board or other Governmental Authority having
jurisdiction with respect thereto, as now and from time to
time in effect) for Eurocurrency funding (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the
Federal Reserve Board) that are required to be maintained by
a member bank of the Federal Reserve System.
If such interest rates shall cease to be available from
Telerate News Service, the LIBOR Rate shall be determined from
such financial reporting service or other information as shall be
mutually acceptable to Lender and Borrower.
Notwithstanding the foregoing, the LIBOR Rate for the
initial LIBOR Period commencing on the Closing Date and ending on
October 31, 2001 shall be determined on September 27, 2001 based
upon a one month LIBOR period commencing October 1, 2001.
"License" means any Copyright License, Patent License,
Trademark License or other license of rights or interests now
held or hereafter acquired by any Credit Party.
"Lien" shall mean, with respect to any asset, any
mortgage, deed to secure debt, deed of trust, lien, pledge,
charge, security title, security interest or other preferential
arrangement which has the practical effect of constituting a
security interest or encumbrance, or encumbrance or servitude of
any kind in respect of such asset to secure or assure payment of
any indebtedness, obligation or liability, whether by consensual
agreement or by operation of statute or other law, or by any
agreement, contingent or otherwise, to provide any of the
foregoing. For purposes of this Agreement, the Borrower or any
Subsidiary thereof shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
"Litigation" has the meaning ascribed to it in Section
3.13.
"Loaded Miles" means for any Shipments, the total miles
that CF Delaware's trailers travel with such Shipments on board.
"Loan Account" has the meaning ascribed to it in
Section 1.8.
"Loan Documents" means the Agreement, the Note, the
Collateral Documents, the Fee Letter and all other agreements,
instruments, documents and certificates identified in the Closing
Checklist executed and delivered to, or in favor of, Lender and
including all other pledges, powers of attorney, consents,
assignments, contracts, notices, and all other written matter
whether heretofore, now or hereafter executed by or on behalf of
any Credit Party, or any employee of any Credit Party, and
delivered to Lender in connection with the Agreement or the
transactions contemplated thereby. Any reference in the
Agreement or any other Loan Document to a Loan Document shall
include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications
thereto, and shall refer to the Agreement or such Loan Document
as the same may be in effect at any and all times such reference
becomes operative.
"Loans" means the Revolving Credit Advances.
"Margin Stock" has the meaning ascribed to it in
Section 3.10.
"Material Adverse Effect" shall mean a material adverse
effect on (a) the business, assets, operations, prospects or
financial or other condition of the Credit Parties considered as
a whole, (b) Borrower's or any Guarantor's ability to pay any of
the Loans or any of the other Obligations in accordance with the
terms of this Agreement, (c) the Collateral or Lender's Liens on
the Collateral or the priority of such Liens, or (d) Lender's
rights and remedies under this Agreement and the other Loan
Documents.
"Maximum Amount" means, as of any date of
determination, an amount equal to the Revolving Loan Commitment
as of such date.
"Menlo Park Property" shall mean the real estate
located at 000 Xxxxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx and any
adjacent or nearby real estate owned by any Credit Party and any
buildings and fixtures located thereon.
"Mortgaged Properties" means (i) the Real Property
identified on Annex F, and (ii) any other Real Property of the
Credit Parties located in the United States of America that
Borrower from time to time requests be included as a Mortgaged
Property to the extent and only to the extent that the Lender in
its sole discretion consents in writing to the inclusion of such
Real Property as a Mortgaged Property.
"Mortgages" means each of the mortgages, deeds of
trust, leasehold mortgages, leasehold deeds of trust, collateral
assignments of leases or other real estate security documents
delivered by any Credit Party to Lender with respect to the
Mortgaged Properties, all in form and substance satisfactory to
Lender.
"Multiemployer Plan" means a "multiemployer plan" as
defined in Section 4001(a)(3) of ERISA, and to which any Credit
Party or ERISA Affiliate is making, is obligated to make or has
made or been obligated to make, contributions on behalf of
participants who are or were employed by any of them.
"Net Proceeds" shall mean, in connection with any
incurrence of the Vancouver Secured Debt, the Additional Secured
Debt, the Term Debt or the Sale-Leaseback Debt, the gross cash
proceeds received by the Borrower or its Subsidiaries from such
transaction minus reasonable and customary transaction costs,
fees and expenses properly attributable to such transaction and
payable by Borrower or its Subsidiaries in connection therewith
(in each case, paid to non-Affiliates of Borrower).
"Note" means the Revolving Note.
"Notice of Revolving Credit Advance" has the meaning
ascribed to it in Section 1.1(a).
"Obligations" means (i) all loans, advances, debts,
liabilities and obligations, for the performance of covenants,
tasks or duties or for payment of monetary amounts (whether or
not such performance is then required or contingent, or such
amounts are liquidated or determinable) owing by any Credit Party
to Lender, and all covenants and duties regarding such amounts,
of any kind or nature, present or future, whether or not
evidenced by any note, agreement or other instrument, arising
under the Agreement or any of the other Loan Documents, (ii) the
Letter of Credit Obligations, and (iii) all Other Secured
Obligations. This term includes all principal, interest
(including all interest that accrues after the commencement of
any case or proceeding in bankruptcy by or against any Credit
Party, whether or not allowed in such case or proceeding), Fees,
Charges, expenses, attorneys' fees and any other sum chargeable
to any Credit Party under the Agreement, any of the other Loan
Documents, any of the Letter of Credit Documents or any of the
Other Credit Documents.
"Other Credit Documents" shall mean (i) any agreement,
note, instrument, lease or guarantee heretofore, now or hereafter
executed or issued by any Credit Party in favor of any Affiliate
of Lender or entered into by a Credit Party with any Affiliate of
Lender, or held by any Affiliate of Lender, and evidencing any
debt, liabilities or obligations for the performance of
covenants, tasks or duties or for payment of monetary amounts
(whether or not such performance is then required or contingent,
or such amounts are liquidated or determinable) of any kind or
nature, present or future, owing by any Credit Party to any
Affiliate of Lender or entered into by a Credit Party with any
Affiliate of Lender, in each case, as such agreements, notes,
instruments, leases and guarantees may be amended, supplemented
or replaced from time to time, and (ii) any agreement, note,
instrument, lease or guarantee (other than the Letter of Credit
Documents, this Agreement and the other Loan Documents)
heretofore, now or hereafter executed or issued by any Credit
Party in favor of Lender, or entered into by a Credit Party with
Lender, or held by Lender, and evidencing any debt, liabilities
or obligations for the performance of covenants, tasks or duties
or for payment of monetary amounts (whether or not such
performance is then required or contingent, or such amounts are
liquidated or determinable) of any kind or nature, present or
future, owing by any Credit Party to Lender, in each case, as
such agreements, notes, instruments, leases and guarantees may be
amended, supplemented or replaced from time to time; provided
that the Other Credit Documents shall not include any of the
Letter of Credit Documents or the Loan Documents.
"Other Secured Obligations" shall mean (i) all
advances, debts, liabilities and obligations, for the performance
of covenants, tasks or duties or for payment of monetary amounts
(whether or not such performance is then required or contingent,
or such amounts are liquidated or determinable) owing by any
Credit Party to any Affiliate of Lender, and all covenants and
duties regarding such amounts, of any kind or nature, present or
future, whether or not evidenced by any Other Credit Documents,
including, without limitation, all advances, debts, liabilities
and obligations arising under any Other Credit Documents and any
other agreement, note, instrument, lease or guarantee heretofore,
now or hereafter executed or issued by any Credit Party in favor
of any Affiliate of Lender, and (ii) all advances, debts,
liabilities and obligations for the performance of covenants,
tasks or duties or for payment of monetary amounts (whether or
not such performance is then required or contingent, or such
amounts are liquidated or determinable) owing by any Credit Party
to Lender, and all covenants and duties regarding such amounts,
of any kind or nature, present or future, whether or not
evidenced by any Other Credit Documents, including, without
limitation, all advances, debts, liabilities and obligations
arising under any Other Credit Documents and any other agreement,
note, instrument, lease or guarantee heretofore, now or hereafter
executed or issued by any Credit Party in favor of Lender. This
term includes all principal, interest (including all interest
which accrues after the commencement of any case or proceeding in
bankruptcy after the insolvency of, or for the reorganization of
any Credit Party, whether or not allowed in such proceeding),
fees, charges, expenses, attorneys' fees and any other sum
chargeable by Lender or any Affiliate of Lender to any Credit
Party under any Other Credit Document. Notwithstanding anything
herein to the contrary, the Other Secured Obligations shall not
include any of the Obligations described in clauses (i) and (ii)
of the definition of such term in this Annex A.
"Participation Agreement" shall mean that certain
Participation Agreement dated as of October 12, 1999, by and
among CF Delaware, as lessee, ABN Amro Bank N.V., as agent and
the financial institutions party thereto as lessors, as amended
prior to the Closing Date.
"Patent License" means rights under any written
agreement now owned or hereafter acquired by any Credit Party
granting any right with respect to any invention on which a
Patent is in existence.
"Patents" means all of the following in which any
Credit Party now holds or hereafter acquires any interest: (a)
all letters patent of the United States or of any other country,
all registrations and recordings thereof, and all applications
for letters patent of the United States or any other country,
including registrations, recordings and applications in the
United States Patent and Trademark Office or in any similar
office or agency of the United States, any State or any other
country, and (b) all reissues, continuations,
continuations-in-part or extensions thereof.
"PBGC" means the Pension Benefit Guaranty Corporation
or any successor thereto.
"Permitted Acquisitions" shall have the meaning
assigned to it in Section 6.1.
"Permitted Encumbrances" shall mean the following
encumbrances: (a) Liens for taxes or assessments or other
governmental Charges that are (i) not yet due and payable or (ii)
being contested in accordance with Section 5.2(b); (b) pledges or
deposits of money securing statutory obligations under workmen's
compensation, unemployment insurance, social security or public
liability laws or similar legislation (excluding Liens under
ERISA); (c) pledges or deposits of money securing bids, tenders,
contracts (other than contracts for the payment of money) or
leases to which any Credit Party is a party as lessee made in the
ordinary course of business; (d) inchoate and unperfected
workers', mechanics' or similar liens arising in the ordinary
course of business, so long as such Liens attach only to
equipment, fixtures and/or real estate; (e) carriers',
warehousemen's, suppliers' or other similar possessory liens
arising in the ordinary course of business; (f) reservations,
exceptions, encroachments, easements, rights of way, covenants
running with the land, and other similar title exceptions or
encumbrances affecting any real estate in which the respective
Credit Party has an interest; provided that they do not in the
aggregate materially detract from the value of such real estate
or materially interfere with its use in the ordinary conduct of
such Credit Party's business; (g) deposits securing, or in lieu
of, surety, appeal or customs bonds in proceedings to which any
Credit Party is a party; (h) any attachment or judgment lien not
constituting an Event of Default under Section 8.1(j); (i)
presently existing or hereinafter created Liens in favor of
Lender; (j) Liens on Receivables Assets in favor of CF Delaware,
the Receivables Subsidiary, the Receivables Administrative Agent,
the Receivables Collateral Agent or the Receivables Lenders
granted pursuant to the Receivables Funding Documents; (k) Liens
on specific tangible assets of Persons which become Subsidiaries
after the date of this Agreement; provided, however, that (A)
such Liens existed at the time the respective Persons became
Subsidiaries and were not created in anticipation thereof, (B)
any such Lien does not by its terms cover any assets after the
time such Person becomes a Subsidiary which were not covered
immediately prior thereto, (C) any such Lien does not by its
terms secure any Indebtedness other than Indebtedness existing
immediately prior to the time such Person becomes a Subsidiary,
(D) such Lien does not attach to any of the Collateral, and (E)
such Indebtedness is permitted by Section 6.3; (l) Liens securing
CFRM Secured Debt, provided that such Lien does not attach to any
of the Collateral; (m) any depository institution's set-off
rights against deposit accounts or any funds or instruments in
the possession of such depository institutions, (n) other Liens
expressly permitted under Section 6.7, and (o) Liens granted in
favor of the Lender pursuant to the Collateral Documents.
"Permitted Stock Repurchases" shall have the meaning
assigned to it in Section 6.13.
"Person" means any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization,
association, corporation, limited liability company, institution,
public benefit corporation, other entity or government (whether
federal, state, county, city, municipal, local, foreign, or
otherwise, including any instrumentality, division, agency, body
or department thereof).
"Plan" means, at any time, an employee benefit plan, as
defined in Section 3(3) of ERISA, that any Credit Party or ERISA
Affiliate maintains, contributes to or has an obligation to
contribute to or has maintained, contributed to on behalf of
participants who are or were employed by any Credit Party or
ERISA Affiliate.
"Pound Miles" means, for any period, the Average Length
Of Haul for all Shipments in such period multiplied by the Total
Shipment Weight for such period.
"Post-Closing Borrowing Date" has the meaning ascribed
to it in Section 2.3(a).
"Proceeds" means "proceeds," as such term is defined in
the Code, including (a) any and all proceeds of any insurance,
indemnity, warranty or guaranty payable to any Credit Party from
time to time with respect to any of the Collateral, (b) any and
all payments (in any form whatsoever) made or due and payable to
any Credit Party from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of
all or any part of the Collateral by any Governmental Authority
(or any Person acting under color of governmental authority), (c)
any claim of any Credit Party against third parties (i) for past,
present or future infringement of any Patent or Patent License,
or (ii) for past, present or future infringement or dilution of
any Copyright, Copyright License, Trademark or Trademark License,
or for injury to the goodwill associated with any Trademark or
Trademark License, (d) any recoveries by any Credit Party against
third parties with respect to any litigation or dispute
concerning any of the Collateral, (e) dividends, interest,
distributions and Instruments with respect to Investment Property
or pledged Stock and (f) any and all other amounts from time to
time paid or payable under or in connection with any of the
Collateral, upon disposition or otherwise.
"Projections" shall mean the Borrower's forecasted
consolidated: (a) balance sheets; (b) profit and loss
statements; (c) cash flow statements; and (d) capitalization
statements, all prepared consistent with the historical financial
statements of the Borrower, together with appropriate supporting
details and a statement of underlying assumptions, which shall
also include projected Availability and letter of credit
requirements.
"Qualified Plan" means a Plan that is intended to be
tax-qualified under Section 401(a) of the IRC.
"Real Property" and "Real Estate" shall be used
interchangeably herein and shall include land and any buildings
and fixtures located thereon.
"Receivables Administrative Agent" shall mean the
Administrative Agent under (and as such term is defined in) the
Receivables Funding Agreement.
"Receivables Advances" shall mean any and all Advances
made under (as such term is defined in) the Receivables Funding
Agreement.
"Receivables Assets" shall have the meaning assigned to
such term in the Intercreditor Agreement.
"Receivables Collateral Agent" shall mean the
Collateral Agent under (and is defined in) the Receivables
Funding Agreement.
"Receivables Facility Termination Date" shall mean the
Facility Termination Date (as defined in the Receivables Funding
Agreement).
"Receivables Funding Agreement" shall mean the
Receivables Funding Agreement, dated as of April 27, 2001, among
the Receivables Subsidiary and GE Capital as the conduit lender's
assignee and as committed lender and the administrative agent, as
such agreement may be amended, supplemented, restated or replaced
from time to time.
"Receivables Funding Documents" shall mean the
Receivables Funding Agreement, the Receivables Sale and
Contribution Agreement, the Receivables Servicing Agreement and
the Receivables Guaranty Agreement.
"Receivables Guaranty Agreement" shall mean the
Guaranty Agreement, dated as of April 27, 2001, among Borrower,
certain of its Subsidiaries, Redwood as the conduit lender and GE
Capital as the committed lender and the administrative agent, as
such agreement may be amended, supplemented, restated and
replaced from time to time.
"Receivables Lenders" shall mean the Lenders under (and
as such term is defined in) the Receivables Funding Agreement.
"Receivables Sale and Contribution Agreement" shall
mean the Receivables Sale and Contribution Agreement, dated as of
April 27, 2001 between CF Delaware as seller and the Receivables
Subsidiary as purchaser, as such agreement may be amended,
supplemented, restated or replaced from time to time.
"Receivables Servicing Agreement" shall mean the
Servicing Agreement, dated as of April 27, 2001, among CF
Delaware, as servicer, the Receivables Subsidiary, the
Receivables Lenders and the Receivables Administrative Agent, as
such agreement may be amended, supplemented, restated or replaced
from time to time.
"Receivables Subsidiary" shall mean Consolidated
Freightways Funding LLC, a Delaware limited liability company.
"Release" means any release, threatened release, spill,
emission, leaking, pumping, pouring, emitting, emptying, escape,
injection, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Material in the indoor or
outdoor environment, including the movement of Hazardous Material
through or in the air, soil, surface water, ground water or
property.
"Reserves" means with respect to the Borrowing Base of
Borrower, such reserves, established by Lender from time to time
as specified in a written notice from Lender to Borrower, against
Borrowing Availability of Borrower that Lender may, in its
reasonable credit judgment, establish from time to time. Without
limiting the generality of the foregoing, Reserves established to
ensure the payment of accrued Interest Expenses or Indebtedness
shall be deemed to be a reasonable exercise of Lender's credit
judgment.
"Restricted Payment" shall mean (a) the declaration or
payment of any dividend or the incurrence of any liability to
make any other payment or distribution of cash or other property
or assets in respect of a Person's Stock, (b) any payment on
account of the purchase, redemption, defeasance, sinking fund or
other retirement of a Person's Stock or any other payment or
distribution made in respect thereof, either directly or
indirectly, (c) any payment or prepayment of principal of,
premium, if any, or interest, fees or other charges on or with
respect to, and any redemption, purchase, retirement, defeasance,
sinking fund or similar payment and any claim for rescission with
respect to, any Subordinated Debt; (d) any payment made to
redeem, purchase, repurchase or retire, or to obtain the
surrender of, any outstanding warrants, options or other rights
to acquire Stock of such Person now or hereafter outstanding; (e)
any payment of a claim for the rescission of the purchase or sale
of, or for material damages arising from the purchase or sale of,
any shares of such Person's Stock or of a claim for
reimbursement, indemnification or contribution arising out of or
related to any such claim for damages or rescission; (f) any
payment, loan, contribution, or other transfer of funds or other
property to any Stockholder of such Person other than payments of
compensation in the ordinary course of business to stockholders
who are employees of such Person; and (g) any payment of
management fees (or other fees of a similar nature) by such
Person to any Stockholder of such Person or their Affiliates.
"Retiree Welfare Plan" shall mean, at any time, a Plan
that is a "welfare plan" as defined in Section 3(2) of ERISA,
provides for continuing coverage or benefits for any participant
or any beneficiary of a participant after such participant's
termination of employment, other than continuation coverage
provided pursuant to Section 4980B of the IRC and at the sole
expense of the participant or the beneficiary of the participant.
"Revolving Credit Advance" has the meaning ascribed to
it in Section 1.1(a)(i).
"Revolving Loan" means, at any time, the aggregate
amount of Revolving Credit Advances outstanding to Borrower.
"Revolving Loan Commitment" means commitment of Lender
to make Revolving Credit Advances, which commitment shall be
Fifty Million Dollars ($50,000,000) on the Closing Date, as such
amount may be adjusted, if at all, from time to time in
accordance with the Agreement.
"Revolving Note" has the meaning ascribed to it in
Section 1.1(a)(ii).
"Sale-Leaseback Debt" shall mean any indebtedness
incurred in any transaction or transactions in which the Borrower
sells or transfers any of its real property and thereafter leases
or rents such property or other property which the Borrower
intends to use for substantially the same purpose as the property
being sold or transferred and which transaction (i) has a final
maturity date of no earlier than six months after the Commitment
Termination Date, (ii) except for regularly scheduled lease
payments on any Sale-Leaseback Debt, has no scheduled principal
payment prior to six months after the Commitment Termination
Date, (iii) is not prepaid, redeemed, or repurchased prior to six
months after the Commitment Termination Date, (iv) is not
guaranteed by any of the Borrower's Subsidiaries, and (v) is not
secured by a Lien on any assets of the Borrower or any of its
Subsidiaries (other than the real property that is the subject of
such transaction).
"Second Group of Mortgaged Properties" means (a) the
Mortgaged Properties identified on Annex F as being the "Second
Group of Mortgaged Properties" and/or (b) such other Mortgaged
Properties as agreed to in writing by the Borrower and the Lender
from time to time, provided that the sum of the Appraised Values
of all of the Eligible Mortgaged Properties comprising the First
Group of Mortgaged Properties and the Second Group of Mortgaged
Properties referred to in clauses (a) and (b) of this definition
is at least $100,000,000.
"Security Agreement" shall mean the Security Agreement,
dates as of April 27, 2001, entered into among Lender and each
Credit Party that is a signatory thereto.
"Shipment" means any shipment represented by a shippers
xxxx of lading.
"Solvent" means, with respect to any Person on a
particular date, that on such date (a) the fair value of the
property of such Person is greater than the total amount of
liabilities, including contingent liabilities, of such Person;
(b) the present fair salable value of the assets of such Person
is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become
absolute and matured; (c) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay as such debts and liabilities
mature; and (d) such Person is not engaged in a business or
transaction, and is not about to engage in a business or
transaction, for which such Person's property would constitute an
unreasonably small capital. The amount of contingent liabilities
(such as litigation, guaranties and pension plan liabilities) at
any time shall be computed as the amount that, in light of all
the facts and circumstances existing at the time, represents the
amount that can be reasonably be expected to become an actual or
matured liability.
"Stock" means all shares, options, warrants, general or
limited partnership interests, membership interests, or other
equivalents (regardless of how designated) of or in a
corporation, partnership, limited liability company or equivalent
entity whether voting or nonvoting, including common stock,
preferred stock or any other "equity security" (as such term is
defined in Rule 3a11-1 of the General Rules and Regulations
promulgated by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended).
"Stockholder" means, with respect to any Person, each
holder of Stock of such Person.
"Subordinated Debt" means Indebtedness of any Credit
Party subordinated to the Obligations in a manner and form
satisfactory to Lender in its sole discretion, as to right and
time of payment and as to any other rights and remedies
thereunder.
"Subsequent Capital Contribution" has the meaning
ascribed to it in Section 1.3(a).
"Subsidiary" means, with respect to any Person, (a) any
corporation of which an aggregate of more than fifty percent
(50%) of the outstanding Stock having ordinary voting power to
elect a majority of the board of directors of such corporation
(irrespective of whether, at the time, Stock of any other class
or classes of such corporation shall have or might have voting
power by reason of the happening of any contingency) is at the
time, directly or indirectly, owned legally or beneficially by
such Person and/or one or more Subsidiaries of such Person, or
with respect to which any such Person has the right to vote or
designate the vote of fifty percent (50%) or more of such Stock
whether by proxy, agreement, operation of law or otherwise, and
(b) any partnership or limited liability company in which such
Person and/or one or more Subsidiaries of such Person shall have
an interest (whether in the form of voting or participation in
profits or capital contribution) of more than 50% or of which any
such Person is a general partner or may exercise the powers of a
general partner.
"Subsidiary Guaranty" shall mean the Subsidiary
Guaranty, dated as of April 27, 2001, executed by all Domestic
Subsidiaries of Borrower (other than the Receivables Subsidiary)
in favor of Lender.
"Supporting Obligations" has the meaning ascribed
thereto in the Code.
"Taxes" shall mean taxes, levies, imposts, deductions,
Charges or withholdings, and all liabilities with respect
thereto, excluding taxes imposed on or measured by the net income
of Lender by the jurisdictions under the laws of which Lender is
organized or any political subdivision thereof or the
jurisdiction in which Lender's Funding Office is located.
"Term Debt" shall mean an Indebtedness of the Borrower
which (i) has a final maturity date of no earlier than six months
after the Commitment Termination Date, (ii) has no scheduled
principal reduction prior to six months after the Commitment
Termination Date, (iii) is not prepaid, redeemed or repurchased
prior to six months after the Commitment Termination Date, (iv)
is not guaranteed by any of Borrower's Subsidiaries and (v) is
not secured by a Lien on any assets (other than real property) of
Borrower or any of its Subsidiaries.
"Terminal Properties" shall mean any facility owned by
a Credit Party and used by a Credit Party in the ordinary course
of its business to receive, store or ship property of its
customers.
"Termination Date" means the date on which the Loans
have been indefeasibly repaid in full and all other Obligations
under this Agreement and the other Loan Documents have been
completely discharged, and Borrower shall not have any further
right to borrow any monies under the Agreement.
"Termination Event" shall mean a Termination Event
under (and as such term is defined in) Annex X to the Receivables
Funding Agreement.
"Third Group of Mortgaged Properties" means (a) the
Mortgaged Properties identified as being the "Third Group of
Mortgaged Properties" on Annex F, and/or (b) such other Mortgaged
Properties as agreed to in writing by the Borrower and the Lender
from time to time, provided that the sum of the Appraised Values
of all of the Eligible Mortgaged Properties comprising the First
Group of Mortgaged Properties, the Second Group of Mortgaged
Properties and the Third Group of Mortgaged Properties referred
to in clauses (a) and (b) of this definition is at least
$200,000,000.
"Title IV Plan" means an employee pension benefit plan,
as defined in Section 3(2) of ERISA (other than a Multiemployer
Plan) that is covered by Title IV of ERISA, and that any Credit
Party or ERISA Affiliate maintains, contributes to or has an
obligation to contribute to on behalf of participants who are or
were employed by any of them.
"Total Shipment Weight" means, for any period, the
total weight of all Shipments for such period.
"Trademark License" means rights under any written
agreement now owned or hereafter acquired by any Credit Party
granting any right to use any Trademark.
"Trademarks" means all of the following now owned or
hereafter existing or adopted or acquired by any Credit Party:
(a) all trademarks, trade names, corporate names, business names,
trade styles, service marks, logos, other source or business
identifiers, prints and labels on which any of the foregoing have
appeared or appear, designs and general intangibles of like
nature (whether registered or unregistered), all registrations
and recordings thereof, and all applications in connection
therewith, including registrations, recordings and applications
in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any state or
territory thereof, or any other country or any political
subdivision thereof; (b) all reissues, extensions or renewals
thereof; and (c) all goodwill associated with or symbolized by
any of the foregoing.
"Unfunded Pension Liability" means, at any time, the
aggregate amount, if any, of the sum of (a) the amount by which
the present value of all accrued benefits under each Title IV
Plan exceeds the fair market value of all assets of such Title IV
Plan allocable to such benefits in accordance with Title IV of
ERISA, all determined as of the most recent valuation date for
each such Title IV Plan using the actuarial assumptions for
funding purposes in effect under such Title IV Plan, and (b) for
a period of 5 years following a transaction which might
reasonably be expected to be covered by Section 4069 of ERISA,
the liabilities (whether or not accrued) that could be avoided by
any Credit Party or any ERISA Affiliate as a result of such
transaction.
"Vancouver Property" shall mean the real estate located
at 00000 XX Xxx, Xxxxxxxxx, Xxxxxxxxxx and any adjacent or nearby
real estate owned by any Credit Party and any buildings and
fixtures located thereon.
"Vancouver Secured Debt" shall mean an Indebtedness of
the Borrower or any of the Subsidiary Guarantors that either
(a)(i) is in an aggregate principal amount of not more than
$25,000,000 at any one time and (ii) is secured only by a Lien
permitted under Section 6.7(d) of the Agreement, or (b) is a
Capital Lease Obligation or other lease obligation with respect
to the Vancouver Property with an implied principal amount of not
more than $25,000,000 (plus the excess of the capitalized value
of such lease over the Net Proceeds of such lease) at any one
time.
"Welfare Plan" means a Plan described in Section 3(i)
of ERISA.
Rules of construction with respect to accounting terms
used in the Agreement or the other Loan Documents shall be as set
forth in Annex D. All other undefined terms contained in any of
the Loan Documents shall, unless the context indicates otherwise,
have the meanings provided for by the Code as in effect in the
State of New York to the extent the same are used or defined
therein. Unless otherwise specified, reference in the Agreement
or any of the Appendices to a Section, subsection or clause refer
to such Section, subsection or clause as contained in the
Agreement. The words "herein," "hereof" and "hereunder" and
other words of similar import refer to the Agreement as a whole,
including all Annexes, Exhibits and Schedules, as the same may
from time to time be amended, restated, modified or supplemented,
and not to any particular section, subsection or clause contained
in the Agreement or any such Annex, Exhibit or Schedule.
Wherever from the context it appears appropriate, each
term stated in either the singular or plural shall include the
singular and the plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, feminine
and neuter genders. The words "including", "includes" and
"include" shall be deemed to be followed by the words "without
limitation"; the word "or" is not exclusive; references to
Persons include their respective successors and assigns (to the
extent and only to the extent permitted by the Loan Documents)
or, in the case of governmental Persons, Persons succeeding to
the relevant functions of such Persons; and all references to
statutes and related regulations shall include any amendments of
the same and any successor statutes and regulations. Whenever
any provision in any Loan Document refers to the knowledge (or an
analogous phrase) of any Credit Party, such words are intended to
signify that one or more of the Executive Officers of such Credit
Party has actual knowledge or awareness of a particular fact or
circumstance or that one or more of the Executive Officers of
such Credit Party, if they had exercised reasonable diligence,
would have known or been aware of such fact or circumstance. Any
reference herein to or definition of any document, instrument or
agreement shall, unless expressly noted otherwise, include the
same as amended, restated, supplemented or otherwise modified
from time to time if and to the extent that the Lender has agreed
or consented in writing to such amendment, restatement,
supplement or other modification.
ANNEX B (Section 2.1(a))
to
CREDIT AGREEMENT
CLOSING CHECKLIST
In addition to, and not in limitation of, the conditions
described in Section 2.1 of the Agreement, pursuant to Section
2.1(a), the following items must be received by Lender in form
and substance satisfactory to Lender on or prior to the Closing
Date (each capitalized term used but not otherwise defined herein
shall have the meaning ascribed thereto in Annex A to this
Agreement):
A. Appendices. All Appendices to the Agreement, in form
and substance satisfactory to Lender.
B. Revolving Note. Duly executed originals of the
Revolving Note dated the Closing Date.
C. Insurance. Satisfactory evidence that the insurance
policies required by Section 5.4 are in full force and effect,
together with appropriate evidence showing loss payable and/or
additional insured clauses or endorsements, as requested by
Lender, in favor of Lender.
D. Security Interests and Code Filings. (a) Evidence
satisfactory to Lender that Lender has a valid and perfected
first priority security interest in the Collateral, including (i)
such documents duly executed by each Credit Party (including
financing statements under the Code and other applicable
documents under the laws of any jurisdiction with respect to the
perfection of Liens) as Lender may request in order to perfect
its security interests in the Collateral and (ii) copies of Code
search reports listing all effective financing statements that
name any Credit Party as Borrower, together with copies of such
financing statements, none of which shall cover the Collateral).
E. Initial Notice of Revolving Credit Advance. Duly
executed originals of a Notice of Revolving Credit Advance, dated
the Closing Date, with respect to the initial Revolving Credit
Advance to be requested by Borrower on the Closing Date.
F. Letter of Direction. Duly executed originals of a
letter of direction from Receivables Subsidiary addressed to
Borrower with respect to the capital contribution to be made by
the Borrower to the Receivables Subsidiary from the proceeds of
the initial Revolving Credit Advance in accordance with Section
1.3(a).
G. Charter and Good Standing. For each Credit Party, such
Person's (a) charter and all amendments thereto, (b) good
standing certificates in its state of incorporation, (c) good
standing certificates from the Secretary of State of Washington,
and (d) good standing certificate for each Credit Party from the
Secretary of State where any Mortgaged Property owned by such
Credit Party that is to be included in the Borrowing Base on the
Closing Date is located, each dated a recent date prior to the
Closing Date and certified by the applicable Secretary of State
or other authorized Governmental Authority.
H. Bylaws and Resolutions. For each Credit Party, (a)
such Person's bylaws, together with all amendments thereto and
(b) resolutions of such Person's Board of Directors, approving
and authorizing the execution, delivery and performance of the
Loan Documents to which such Person is a party and the
transactions to be consummated in connection therewith, each
certified as of the Closing Date by such Person's corporate
secretary or an assistant secretary as being in full force and
effect without any modification or amendment.
I. Incumbency Certificates. For each Credit Party,
signature and incumbency certificates of the officers of each
such Person executing any of the Loan Documents, certified as of
the Closing Date by such Person's corporate secretary or an
assistant secretary as being true, accurate, correct and
complete.
J. Opinions of Counsel. Duly executed originals of the
following opinions of counsel for the Credit Parties:
(a) Opinion of Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP dated
the Closing Date, in form and substance satisfactory to Lender;
(b) Opinion of Stoel Rives LLP dated the Closing Date,
in form and substance satisfactory to Lender; and
(c) Opinions of local counsel as required in paragraph
L of this Annex B, each in form and substance satisfactory to
Lender.
K. Officer's Certificate. Lender shall have received duly
executed originals of a certificate of the Chief Financial
Officer of Borrower, dated the Closing Date, stating that, since
December 31, 2000 (a) no event or condition has occurred or is
existing which could reasonably be expected to have a Material
Adverse Effect; (b) there has been no material adverse change in
the industry in which Borrower operates; (c) no Litigation has
been commenced which could reasonably be expected to have a
Material Adverse Effect or could challenge any of the
transactions contemplated by the Agreement and the other Loan
Documents; (d) there have been no Restricted Payments made by any
Credit Party; and (e) there has been no material increase in
liabilities, liquidated or contingent, and no material decrease
in assets of Borrower or any of its Subsidiaries.
L. Mortgages. Mortgages covering the First Group of
Mortgaged Properties, together with: (a) title insurance
policies, in each case satisfactory in form and substance to
Lender, in its sole discretion, providing for title insurance
coverage which satisfies the condition set forth in Section
2.1(f); (b) evidence that counterparts of the Mortgages relating
to each First Group of Mortgaged Property have been recorded in
all places to the extent necessary to create a valid and
enforceable first priority lien (subject to Permitted
Encumbrances) on each First Group of Mortgaged Property in favor
of Lender (or in favor of such other trustee as may be required
or desired under local law); and (c) an opinion of counsel in
each state in which each First Group of Mortgaged Property is
located in form and substance and from counsel satisfactory to
Lender.
M. Environmental Reports. Lender shall have received
Phase I Environmental Site Assessment Reports, consistent with
American Society for Testing and Materials (ASTM) Standard E 1527-
94 and applicable state requirements, on the First Group of
Mortgaged Properties, dated no more than 6 months prior to the
Closing Date, prepared by environmental engineers satisfactory to
Lender, all in form and substance satisfactory to Lender, in its
sole discretion; and Lender shall have further received such
environmental review and audit reports, including Phase II
reports, with respect to the First Group of Mortgaged Properties
as Lender shall have requested, and Lender shall be satisfied, in
its sole discretion, with the contents of all such environmental
reports. Lender shall have received letters executed by the
environmental firms preparing such environmental reports, in form
and substance satisfactory to Lender, authorizing Lender to rely
on such reports.
N. Appraisals. Lender shall have received fair market
value appraisals for each of the First Group of Mortgaged
Properties, each of which shall be in form and substance
satisfactory to Lender.
O. Audited Financials; Financial Condition. Lender shall
have received the final Financial Statements for the Fiscal
Quarter ended June 30, 2001 and the monthly financial statements
for the months ended July 31, 2001, August 31, 2001 and September
30, 2001, certified by Borrower's Chief Financial Officer, in
each case in form and substance satisfactory to Lender, and
Lender shall be satisfied, in its sole discretion, with all of
the foregoing. Lender shall have further received a certificate
of the Chief Executive Officer and/or the Chief Financial Officer
of Borrower, to the effect that (a) Borrower will be Solvent upon
the consummation of the transactions contemplated herein; and (b)
containing such other statements with respect to the solvency of
Borrower and matters related thereto as Lender shall request.
P. Disbursement Direction Letter. Lender shall have
received a Disbursement Direction Letter dated as of the Closing
Date, duly executed by the Borrower, in the form of Exhibit
1.3(a) attached hereto.
Q. Amendment to Letter of Credit Documents. Credit
Parties shall have executed and delivered to Lender the Fifth
Amendment to the Letter of Credit Agreements which shall be in
form and substance satisfactory to Lender.
R. Initial Borrowing Base Certificate. Borrower shall
have executed and delivered to Lender a Borrowing Base
Certificate dated as of the Closing Date.
S. Other Documents. Such other certificates, documents
and agreements respecting any Credit Party as Lender may, in its
sole discretion, request.
ANNEX C (Section 4.1(a))
to
CREDIT AGREEMENT
FINANCIAL STATEMENTS AND PROJECTIONS -- REPORTING
Borrower shall deliver or cause to be delivered to
Lender the following:
(a) Annual Audited Financials. As soon as available,
and in any event within 90 days after the end of each Fiscal
Year, (i) a copy of the audited consolidated financial statements
for such year for the Borrower and its Subsidiaries, certified in
each case in a manner satisfactory to the Lender by Xxxxxx
Xxxxxxxx LLP (or its successor) or other nationally recognized
independent public accountants acceptable to the Lender, with
such financial statements being prepared in accordance with GAAP
applied consistently throughout the period involved (except as
approved by such accountants and disclosed therein), (ii) a
report from Xxxxxx Xxxxxxxx LLP (or its successor) or other
nationally recognized independent public accountants reasonably
acceptable to the Lender (upon which report Lender shall be
entitled to rely) to the effect that such firm has caused this
Agreement to be reviewed and that in the course of their audit of
the Borrower and its Subsidiaries no facts have come to their
attention to cause them to believe that any Default or Event of
Default exists and in particular that they have no knowledge of
any failure on the part of the Borrower to comply with the
financial covenants in this Agreement or any failure on the part
of the Borrower to comply with this Agreement in the preparation
of the Monthly Reports delivered during the previous Fiscal Year,
or if such is not the case, specifying any exception and the
nature thereof, and (iii) a Compliance Certificate (as defined in
paragraph (b) below) showing the calculations used in determining
compliance with each financial covenant set forth on Annex D as
of the end of and for the Rolling Period (as defined in Annex D)
which ends with such Fiscal Year and a management discussion and
analysis that includes a comparison to budget for such Fiscal
Year and a comparison of performance for such Fiscal Year to the
prior Fiscal Year.
(b) Quarterly Financials. As soon as available, and
in any event within 45 days after the end of each fiscal quarter
(other than the last fiscal quarter of any fiscal year),
financial information regarding the Borrower and its
Subsidiaries, certified by the Chief Financial Officer of the
Borrower, consisting of consolidated (i) unaudited balance sheets
as of the close of such Fiscal Quarter and the related statements
of income and cash flows for that portion of the Fiscal Year
ending as of the close of such Fiscal Quarter and (ii) unaudited
statements of income and cash flows for such Fiscal Quarter,
setting forth in comparative form the figures for the
corresponding period in the prior year and the figures contained
in the Projections for such fiscal year, all prepared in
accordance with GAAP. Such financial information shall be
accompanied by the certification of the Chief Financial Officer
of the Borrower that (A) such financial information presents
fairly in accordance with GAAP the financial position and results
of operations of the Borrower and its Subsidiaries, on a
consolidated basis as at the end of such Fiscal Quarter and for
the period then ended, subject to the absence of footnotes
(except as to the identity of the Receivables Subsidiary) and to
ordinary year-end audit adjustments and (B) any other information
presented is true, correct and complete in all material respects
and that there was no Default or Event of Default in existence as
of such time or, if an Default or Event of Default shall have
occurred and be continuing, describing the nature thereof and all
efforts undertaken to cure such Default or Event of Default. In
addition, the Borrower shall furnish to Lender, within forty-five
(45) days after the end of each fiscal quarter (other than the
last fiscal quarter of any fiscal year), (y) a statement in
reasonable detail (each, a "Compliance Certificate") showing the
calculations used in determining compliance with each financial
covenant set forth on Annex D as of the end of and for the
Rolling Period (as defined in Annex D) which ends with such
fiscal quarter and (z) a management discussion and analysis that
includes a comparison to budget for the fiscal year to date as of
the end of such fiscal quarter and a comparison of performance
for the fiscal year to date as of the end of that fiscal quarter
to the corresponding period in the prior year.
(c) Monthly Financials. As soon as available, and in
any event within 30 days after the end of each Fiscal Month
(other than the last month of any Fiscal Quarter), financial
information regarding the Borrower and its Subsidiaries,
certified by the Chief Financial Officer of the Borrower,
consisting of consolidated (i) unaudited balance sheets as of the
close of such Fiscal Month and the related statements of income
and cash flows for that portion of the Fiscal Year ending as of
the close of such Fiscal Month and (ii) unaudited statements of
income and cash flows for such Fiscal Month, setting forth in
comparative form the figures for the corresponding period in the
prior year and the figures contained in the Projections for such
Fiscal Year, all prepared in accordance with GAAP. Such
financial information shall be accompanied by the certification
of the Chief Financial Officer of the Borrower that (A) such
financial information presents fairly in accordance with GAAP the
financial position and results of operations of the Borrower and
its Subsidiaries, on a consolidated basis as at the end of such
month and for the period then ended, subject to the absence of
footnotes and to ordinary year-end audit adjustments and (B) any
other information presented is true, correct and complete in all
material respects and that there was no Default or Event of
Default in existence as of such time or, if a Default or Event of
Default shall have occurred and be continuing, describing the
nature thereof and all efforts undertaken to cure such Default or
Event of Default.
(d) Operating Plan. As soon as available, but not
later than the earlier of (i) 60 days after the end of each
Fiscal Year and (ii) three (3) Business Days after Board of
Directors approval thereof, an annual operating plan for the
Borrower and its Subsidiaries, approved by the Board of Directors
of the Borrower, for the following year, which will (i) include a
statement of all of the material assumptions on which such plan
is based, (ii) include monthly balance sheets and a monthly
budget for the following year and (iii) integrate sales, gross
profits, operating expenses, operating profit, cash flow
projections, all prepared on the same basis and in similar detail
as that on which operating results are reported (and in the case
of cash flow projections, representing management's good faith
estimates of future financial performance based on historical
performance).
(e) Management Letters. Within five Business Days
after receipt thereof by the Borrower, copies of all management
letters, exception reports or similar letters or reports received
by the Borrower from its independent certified public
accountants.
(f) Default Notices. As soon as practicable, and in
any event within five Business Days after an Executive Officer of
the Borrower has actual knowledge of the existence thereof,
telephonic or telecopied notice of each of the following events,
in each case specifying the nature and anticipated effect thereof
and what action, if any, any Credit Party proposes to take with
respect thereto, which notice, if given telephonically, shall be
promptly confirmed in writing on the next Business Day:
(i) any Default or Event of Default;
(ii) any Incipient Termination Event or
Termination Event (as such terms are defined in the Receivables
Funding Agreement or Annex X thereto);
(iii) any Adverse Claim in excess of $10,000
made or asserted against any of the Collateral of which it
becomes aware;
(iv) any Adverse Claim made or asserted against
any of the Borrower Collateral (as such term is defined in the
Receivables Funding Agreement or Annex X thereto) of which it
becomes aware;
(v) the occurrence of any event that would have a
material adverse effect on the aggregate value of the Borrower
Collateral (as such term is defined in the Receivables Funding
Agreement or Annex X thereto) or on the assignments and Liens
granted by the Receivables Subsidiary pursuant to the Receivables
Funding Agreement;
(vi) the occurrence of any event of the type
described in clauses (f)(iii) or (f)(iv) of Annex 4.02(h) of the
Receivables Sale and Contribution Agreement involving any Obligor
(as such term is defined in the Receivables Funding Agreement or
Annex X thereto) obligated under Transferred Receivables (as such
term is defined in the Receivables Funding Agreement or Annex X
thereto) with an aggregate Outstanding Balance (as such term is
defined in the Receivables Funding Agreement or Annex X thereto)
at such time of $1,000,000 or more;
(vii) the receipt of notice by Borrower or
any of its Subsidiaries that (A) Borrower or any of its
Subsidiaries is being placed under regulatory supervision, (B)
any license, permit, charter, registration or approval necessary
for the conduct of the Borrower's or any of its Subsidiary's
business is to be, or may be, suspended or revoked, or (C) the
Borrower or any of its Subsidiaries is to cease and desist any
practice, procedure or policy employed by it in the conduct of
its business if such cessation may have a Material Adverse
Effect; or
(viii) any other event, circumstance or
condition that has had or could reasonably be expected to have a
Material Adverse Effect.
(g) SEC Filings and Press Releases. Promptly upon
their becoming available, copies of: (i) all financial
statements, reports, notices and proxy statements made publicly
available by the Borrower or CF Delaware to its security holders;
(ii) all regular and periodic reports and all registration
statements and prospectuses, if any, filed by the Borrower or CF
Delaware with any securities exchange or with the Securities and
Exchange Commission or any governmental or private regulatory
authority; and (iii) all press releases and other statements made
available by the Borrower or CF Delaware to the public concerning
material adverse changes or developments in the business of any
such Person.
(h) Litigation. Promptly upon learning thereof,
written notice of any Litigation commenced or threatened against
(i) Borrower or any of its Subsidiaries or with
respect to or in connection with all or any portion of the
Collateral that (A) seeks damages or penalties in an uninsured
amount in excess of $10,000,000 in any one instance or
$10,000,000 in the aggregate, or, to the extent such matter
affects any of the Collateral, $500,000 in any one instance or
$500,000 in the aggregate, (B) seeks injunctive relief (other
than injunctive relief relating to labor practices which together
with all other such injunctions could not reasonably be expected
to have a Material Adverse Effect), (C) is asserted or instituted
against any Plan, its fiduciaries or its assets or against
Borrower or any of its ERISA Affiliates in connection with any
Plan, (D) alleges criminal misconduct by Borrower or any of its
Subsidiaries, or (E) could reasonably be expected, if determined
adversely, to have a Material Adverse Effect; or
(ii) affecting the Receivables Subsidiary, the
Transferred Receivables (as such term is defined in the
Receivables Funding Agreement or Annex X thereto) or the Borrower
Collateral (as such term is defined in the Receivables Funding
Agreement or Annex X thereto), whether or not fully covered by
insurance, and regardless of the subject matter thereof that (i)
seeks damages in excess of $10,000,000 or, to the extent such
matter affects any of the Collateral, $500,000, (ii) seeks
injunctive relief, (iii) is asserted or instituted against any
Plan, its fiduciaries or its assets or against the Receivables
Subsidiary or any ERISA Affiliate of the Receivables Subsidiary
in connection with any Plan, (iv) alleges criminal misconduct the
Receivables Subsidiary or (v) would, if determined adversely,
have a Material Adverse Effect.
(i) Downgrading of Credit Rating. Promptly upon
learning of thereof, written notice of any downgrading of the
rating of the Indebtedness of the Borrower by Standard & Poor's
Ratings Services, a division of The XxXxxx-Xxxx Companies, Inc.,
or any successor thereto, or Xxxxx'x Investors Service, Inc. or
any successor thereto, setting forth the Indebtedness affected
and the nature of the change.
(j) Notice of Liens. As soon as practicable, and in
any event within five Business Days after any Executive Officer
of the Borrower or any Subsidiary Guarantor has actual knowledge
of the existence thereof, telephonic or telecopied notice of any
Lien on any of the Collateral as a result of any judgment
rendered against such Person or the failure of such Person to pay
when due any employee wages or any federal, state or local taxes.
(k) Borrowing Base Certificate. No less frequently
than five Business Days after the end of each month, a Borrowing
Base Certificate, in form and substance satisfactory to Lender,
accompanied by such supporting detail and documentation as shall
be requested by Lender in its reasonable discretion.
Additionally, Borrower shall deliver to Lender a Borrowing Base
Certificate at any time Borrower wishes to add any Mortgaged
Property as an Eligible Mortgaged Property to the Borrowing Base.
(l) Other Documents. Such other financial and other
information respecting the Collateral or the condition or
operations, financial or otherwise, of the Borrower or any of its
other Subsidiaries (including the Receivables Subsidiary) as
Lender shall, from time to time, request.
ANNEX D (Section 6.10)
to
CREDIT AGREEMENT
FINANCIAL COVENANTS
(a) Minimum Fixed Charge Coverage Ratio. The Borrower
and its Subsidiaries shall have on a consolidated basis, as of
the end of each Fiscal Quarter set forth below, a Fixed Charge
Coverage Ratio for the Rolling Period then ended of not less than
the following:
Fiscal Quarter Minimum Fixed
Charge
Coverage Ratio
Fiscal Quarter ending 0.20 to 1.00
September 30, 2001
Fiscal Quarter ending 0.01 to 1.00
December 31, 2001
Fiscal Quarter ending -1.0 to 1.00
March 31, 2002
Fiscal Quarter ending 0.30 to 1.00
June 30, 2002
Fiscal Quarter ending 1.60 to 1.00
September 30, 2002
Fiscal Quarter ending 1.70 to 1.00
December 31, 2002 and
each Fiscal Quarter
thereafter
(b) Minimum Tangible Net Worth. Borrower and its
Subsidiaries on a consolidated basis shall have a Tangible Net
Worth, (i) as of the Closing Date and as of the end of each of
the second and third Fiscal Quarters of the Fiscal Year ending
December 31, 2001, of not less than $180,000,000, (ii) as of the
end of the fourth Fiscal Quarter of the Fiscal Year ending
December 31, 2001, of not less than $150,000,000, (iii) as of the
end of each of the first, second and third Fiscal Quarters of the
Fiscal Year ending December 31, 2002, of not less than
$120,000,000, and (iv) as of the end of the fourth Fiscal Quarter
of the Fiscal Year ending December 31, 2002 and as of the end of
each of the first, second and third Fiscal Quarters of the Fiscal
Year ending December 31, 2003, of not less than $130,000,000.
Thereafter, Borrower and its Subsidiaries on a consolidated basis
shall have, as of the end of each Fiscal Year ending on or after
December 31, 2003 (each such Fiscal Year herein called the
"Subject Fiscal Year") and as of the end of the first three
Fiscal Quarters of the immediately succeeding Fiscal Year, a
Tangible Net Worth of not less than the sum of (i) the minimum
Tangible Net Worth required hereunder for the Fiscal Year which
immediately preceded the Subject Fiscal Year (or, where the
Subject Fiscal Year is the Fiscal Year ending December 31, 2003,
the sum of $130,000,000) plus (ii) an amount equal to fifty
percent (50%) of the positive net income of the Borrower and its
Subsidiaries on a consolidated basis for the Subject Fiscal Year
plus (iii) an amount equal to one hundred percent (100%) of the
amount of any equity raised by or capital contributed to the
Borrower during the Subject Fiscal Year (in the case of equity
raised or capital contributed, net of the bona fide, reasonable
expenses, if any, relating to the raising of such equity or such
capital contribution and paid to Persons who are not Affiliates
of the Borrower).
(c) Minimum EBITDA. Borrower and its Subsidiaries
shall have on a consolidated basis for each Fiscal Quarter set
forth below an EBITDA for the Rolling Period then ended of not
less than the following:
Fiscal Quarter Minimum EBITDA
Fiscal Quarter ending $8,000,000
September 30, 2001
Fiscal Quarter ending $6,000,000
December 31, 2001
Fiscal Quarter ending -$17,000,000
March 31, 2002
Fiscal Quarter ending $15,000,000
June 30, 2002
Fiscal Quarter ending $53,000,000
September 30, 2002
Fiscal Quarter ending $80,000,000
December 31, 2002 and
for each Fiscal Quarter
thereafter
(d) Maximum Capital Expenditures. Borrower and its
Subsidiaries shall not make or incur any Capital Expenditures if,
after giving effect thereto, the aggregate amount of all Capital
Expenditures made or incurred by Borrower and its Subsidiaries
during any period of four (4) consecutive Fiscal Quarters would
exceed the amounts set forth below for such period:
Four Consecutive Fiscal Maximum Capital
Quarters Ending Expenditures
Fiscal Quarter ending $35,000,000
June 30, 2001
Fiscal Quarter ending $36,000,000
September 30, 2001
Fiscal Quarter ending $30,000,000
December 31, 2001
Fiscal Quarter ending $25,000,000
March 31, 2002 and for
each Fiscal Quarter
thereafter
Capitalized terms used in this Annex D and not
otherwise defined below shall have the respective meanings
ascribed to them in Annex A to this Agreement. The following
terms shall have the respective meanings set forth below:
"Capital Expenditures" shall mean, with respect to any
Person, all expenditures (by the expenditure of cash or the
incurrence of Indebtedness) by such Person during any measuring
period for any fixed assets or improvements or for replacements,
substitutions or additions thereto, that have a useful life of
more than one year and that are required to be capitalized under
GAAP, but excluding (i) Capital Expenditures of the Borrower or
any Subsidiary Guarantor financed by the incurrence of Term Debt
to the extent that such Term Debt is permitted to be incurred
under Section 6.3, provided that on or prior to the date of
incurrence of such Term Debt, Borrower has furnished to Lender a
written statement of sources and uses of such Term Debt, which
statement describes with particularity the principal amount of
the Term Debt to be used for the proposed Capital Expenditure and
the fixed assets or improvements to be acquired, replaced,
substituted or added to in connection with such proposed Capital
Expenditure, (ii) the purchase of the Vancouver Property by the
Borrower, provided that to the extent the purchase price of the
Vancouver Property exceeds $25,000,000, such excess shall be
included as a Capital Expenditure for purposes of determining
compliance with the Maximum Capital Expenditure covenant set
forth in paragraph (d) of this Annex D, (iii) any Capital
Expenditures incurred by the Borrower in connection with the
refinancing of the Participation Agreement, provided that to the
extent that such Capital Expenditures exceed $22,500,000, such
excess shall be included as a Capital Expenditure for purposes of
determining compliance with the Maximum Capital Expenditure
covenant set forth in paragraph (d) of this Annex D, (iv) any
purchase by the Borrower or any Subsidiary of fixed assets or
improvements to the extent that such purchase qualifies for like-
kind tax treatment under Section 1031 of the IRC, provided that
such exclusion from Capital Expenditures under this clause (iv)
shall be limited to an amount not to exceed the lesser of (x) the
cash proceeds received from the transfer of the property
relinquished in the like-kind exchange, assuming for purposes
hereof that the Borrower or Subsidiary does not qualify for like-
kind tax treatment under Section 1031 of the IRC in connection
with such transfer and (y) the value of the fixed assets or
improvements purchased by the Borrower in the subject transaction
which qualifies for like-kind tax treatment under Section 1031 of
the IRC, (v) any purchase by the Borrower or any Subsidiary of
fixed assets or improvements with the proceeds received from the
sale of the Menlo Park Property, provided that on or prior to the
date of any such Capital Expenditures, Borrower has furnished to
Lender a written statement of sources and uses of the proceeds
from the sale of the Menlo Park Property, which statement
describes with particularity the amount of the proceeds from the
sale of the Menlo Park Property to be used for the proposed
Capital Expenditure and the fixed assets or improvements to be
acquired, replaced, substituted or added to in connection with
such proposed Capital Expenditures, and (vi) such other items as
Borrower and Lender may agree in writing to exclude.
"EBITDA" shall mean, with respect to any Person for any
fiscal period, the amount equal to (a) consolidated net income of
such Person for such period, plus (b) the sum of (i) any
provision for income taxes, (ii) Interest Expense, (iii) loss
from extraordinary items for such period, (iv) depreciation and
amortization for such period, (v) amortized debt discount for
such period, (vi) the amount of any deduction to consolidated net
income as the result of any grant to any members of the
management of such Person of any Stock, and (vii) Lease Expenses,
in each case to the extent included in the calculation of
consolidated net income of such Person for such period in
accordance with GAAP, but without duplication, minus (c) the sum
of (i) income tax credits, (ii) interest income, (iii) gain from
extraordinary items for such period, (iv) any aggregate net gain
(but not any aggregate net loss) during such period arising from
the sale, exchange or other disposition of capital assets by such
Person (including any fixed assets, whether tangible or
intangible, all inventory sold in conjunction with the
disposition of fixed assets and all securities), provided that
there shall be excluded from the amount of any aggregate net gain
under this clause (iv), in solely the Fiscal Quarter ending March
31, 2001, an amount equal to the lesser of (x) $19,200,000 and
(y) the actual gain recognized by the Borrower and its
Subsidiaries from the sale of its Portland, Oregon administrative
complex and (v) any other non-cash gains that have been added in
determining consolidated net income (including LIFO adjustments),
in each case to the extent included in the calculation of
consolidated net income of such Person for such period in
accordance with GAAP, but without duplication. For purposes of
this definition, the following items shall be excluded in
determining consolidated net income of a Person: (A) the income
(or deficit) of any other Person accrued prior to the date it
became a Subsidiary of, or was merged or consolidated into, such
Person or any of such Person's Subsidiaries; (B) the income (or
deficit) of any other Person (other than a Subsidiary) in which
such Person has an ownership interest, except to the extent any
such income has actually been received by such Person in the form
of cash dividends or distributions; (C) the undistributed
earnings of any Subsidiary of such Person to the extent that the
declaration or payment of dividends or similar distributions by
such Subsidiary is not at the time permitted by the terms of any
contractual obligation or requirement of law applicable to such
Subsidiary; (D) any restoration to income of any contingency
reserve, except to the extent that provision for such reserve was
made out of income accrued during such period; (E) any write-up
of any asset; (F) any net gain from the collection of the
proceeds of life insurance policies; (G) any net gain arising
from the acquisition of any securities, or the extinguishment,
under GAAP, of any Indebtedness, of such Person, (H) in the case
of a successor to such Person by consolidation or merger or as a
transferee of its assets, any earnings of such successor prior to
such consolidation, merger or transfer of assets, and (I) any
deferred credit representing the excess of equity in any
Subsidiary of such Person at the date of acquisition of such
Subsidiary over the cost to such Person of the investment in such
Subsidiary.
"Fixed Charges" shall mean, with respect to any Person
for any fiscal period, the aggregate of, without duplication, (a)
all Interest Expense and Lease Expense paid or accrued during
such period, plus (b) all regularly scheduled payments of
principal or implied principal with respect to Indebtedness
(including any lease payments by any Person in respect of any
Capital Leases, any Sale-Leaseback Debt or any Vancouver Secured
Debt) due or made during such period, plus (c) all Restricted
Payments made during such period (other than Permitted Stock
Repurchases covered by Section 6.14(vii) of the Letter of Credit
Agreement), plus (d) any cash payments made by such Person in
connection with any Permitted Acquisitions (as such term is
defined in the Letter of Credit Agreement).
"Fixed Charge Coverage Ratio" shall mean, with respect
to any Person for any fiscal period, the ratio of (i) the sum of
(x) EBITDA for such period less (y) cash taxes made during such
period to (ii) Fixed Charges for such period.
"Interest Expense" shall mean, with respect to any
Person for any fiscal period, the sum of (a) interest expense
(whether cash or non-cash) of such Person determined in
accordance with GAAP for the relevant period ended on such date,
including (i) amortization of original issue discount on any
Indebtedness and of all fees payable in connection with the
incurrence of such Indebtedness (to the extent included in
interest expense), (ii) the interest portion of any deferred
payment obligation, (iii) the interest component of any Capital
Lease Obligation plus (b) the amount of any Letter of Credit Fee
(as such term is defined in the Letter of Credit Agreement) paid
during the relevant period ended on such date, plus (c) the
amount of any payments by such Person, as lessee, under any sale-
leaseback or synthetic lease transaction.
"Lease Expenses" shall mean, with respect to any Person
for any fiscal period, the aggregate rental obligations of such
Person determined in accordance with GAAP that are payable in
respect of such period under operating leases of equipment having
an original non-cancelable term (as determined in accordance with
GAAP) in excess of twelve months (net of income from subleases
thereof, but including taxes, insurance, maintenance and similar
expenses that the lessee is obligated to pay under the terms of
such leases), whether or not such obligations are reflected as
liabilities or commitments on a consolidated balance sheet of
such Person or in the notes thereto, excluding, however, any such
obligations under Capital Leases.
"Net Worth" shall mean, with respect to any Person as
of any date of determination, (a) the book value of the assets of
such Person, minus (b) reserves applicable thereto, minus (c) all
of such Person's liabilities on a consolidated basis (including
accrued and deferred income taxes), all as determined in
accordance with GAAP.
"Rolling Period" shall mean, as of the end of any
Fiscal Quarter, the immediately preceding four (4) Fiscal
Quarters, including the Fiscal Quarter then ending.
"Tangible Net Worth" shall mean, with respect to any
Person at any date, the Net Worth of such Person at such date,
(x) excluding, however, from the determination of the total
assets at such date, (a) all goodwill, capitalized organizational
expenses, capitalized research and development expenses,
trademarks, trade names, copyrights, patents, patent
applications, licenses (excluding software licenses) and rights
in any thereof, and other intangible items (other than software
licenses), (b) all unamortized debt discount and expense, (c)
treasury Stock, and (d) any write-up in the book value of any
asset resulting from a revaluation thereof, but (y) including any
non-cash valuation reserves for deferred taxes and any foregone
tax benefits provided that such reserves are established in
accordance with Financial Accounting Standard Number 109 and do
not result in an increase in such Person's future cash tax
payments.
Rules of Construction Concerning Financial Covenants.
Unless otherwise specifically provided therein, any accounting
term used in any Loan Document shall have the meaning customarily
given such term in accordance with GAAP, and all financial
computations thereunder shall be computed in accordance with GAAP
consistently applied. That certain items or computations are
explicitly modified by the phrase "in accordance with GAAP" shall
in no way be construed to limit the foregoing. If any Accounting
Changes occur and such changes result in a change in the
calculation of the financial covenants, standards or terms used
in any Loan Document, then the parties thereto agree to enter
into negotiations in order to amend such provisions so as to
equitably reflect such Accounting Changes with the desired result
that the criteria for evaluating the financial condition of such
Persons and their Subsidiaries shall be the same after such
Accounting Changes as if such Accounting Changes had not been
made. If the parties thereto agree upon the required amendments
thereto, then after appropriate amendments have been executed and
the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained therein shall, only
to the extent of such Accounting Change, refer to GAAP
consistently applied after giving effect to the implementation of
such Accounting Change. If such parties cannot agree upon the
required amendments within 30 days following the date of
implementation of any Accounting Change, then all financial
statements delivered and all calculations of financial covenants
and other standards and terms in accordance with the Related
Documents shall be prepared, delivered and made without regard to
the underlying Accounting Change.
ANNEX F
to
CREDIT AGREEMENT
LIST OF MORTGAGED PROPERTIES
First Group of Mortgaged Properties:
1 MPK MENLO PARK CA 000 XXXXXXXX XXXXX
0 XXX XXXXXXXXX XX 00000 OLD HICKORY BLVD.
Second Group of Mortgaged Properties:
1 COL COLUMBUS OH 0000 XXXX XXXXX XXXXX
0 XXX XXXXXXX XX 0000 X XXXXXX XXXXXX
0 XXX XXXXXXXXX XX 0000 XXXXXXX XXXX XXXXX
0 XXX XXXXXXXXXXXX XX 0000 X. XXXXXXXX XXXXXX
5 LAT LAREDO TX 13145 UNITEC DRIVE
6 SLC SALT LAKE CITY UT 2325 SOUTH 0000 XXXX
0 XXX XXXX XXXXX XX 00000 XXXXXXXXXX XXX
0 XXX XXXXXX XX 000 XXXX XXXXXX
0 XXX XXXXXXX XX 4847 BLAFFER STREET
10 MPL MINNEAPOLIS MN 0000 00XX XXXXXX, X.X.
00 XXX XXX XXXXXXX XX 0000 XXXX XXXXXXXXXX XXXX
Third Group of Mortgaged Properties:
0 XXX XXXXXX XXXX XX 0000 XXXXXXX XXXX
0 XXX XXXXXXXX XX 000 XXXXXX XXXXX
0 XXX XXX XXXX XX 000 XXXXXXXXXX XXXXXX
4 IND INDIANAPOLIS IN 0000 XXXX XXXXXX XXXXXX
0 XXX XXXXX XX 0000 XXXXXXXXXXX XXXX
0 XXX XXXXXXX XX 0000 XXXXXXXX XXXXXXXXX
0 XXX XXXXXXXX XX 2010 N. E. RIVERSIDE WAY
8 ORG ORANGE CA 2200 NORTH BATAVIA
9 DVR DENVER CO 0000 XXXX 00XX XXXXXX
00 XXX XXXXXXXXX XX 000 XXXX XXXXXX XXXXXX
00 XXX XXXXX XX 0000 X.X. 00XX XXXXXX
00 XXX XXXXXXX XX 000 XXXXXXX XXXXXX
00 XXX XXXXXX XX 3925 XXXXXXXXX XXXXXXXXX
00 XXX XXXX PA RD 00 XXXXXX XXXX,
00 XXX XX. LOUIS MO 0000 XXXXX XXXX XXXXXX
00 XXX XXXXXXXXXXXX XX 0000 XXXXX XXXX XXXXXX
17 DPI DES PLAINES IL 0000 X XXXXX XXXXXXXX
00 XXX XXXXXXX XX 000 XXXXXXXXXX XX.
00 XXX XXXXX XX 00000 XXXXXXXX STREET
00 XXX XXXXXXXX XX 0000 XXXXXX XXXXXX
00 XXX XXXXXX XX 000 XXXXX XX.
00 XXX XX XXXX XX 000 XXXXX XXXXX XXXXX
00 XXX XXXXXXXX XX 00000 LIVE OAK LANE
24 SVC XXX XXXXXXXX XX 00000 MONTAGUE STREET
VLY
25 WVW XXXXXXXXXXX XX 00000 000XX XXXXXX X.X.
00 XXX XXXX XXXXXX XX 000 XXXXX XXXXXX XXXX
00 XXX XXXXXX XX 0000 X 00XX XXXXXX
00 XXX XXXX XX XX 00000 XXXXXXX STREET
INDUSTRY
00 XXX XXXXXXXX XX 0000 XXXXXX XXXX
00 XXX XX XXXXXXXXXX XX 0000 XXXXXX XXXX
00 XXX XXXXXXX XX 0000 XXXXX XXXXX
00 XXX XXXX XXXXXX XX 00 XXXX XXXX XXXXXX
00 XXX XXX XXXXXX XX 000 XXXXXX XXXXX
00 XXX XXXXXXXXX XX 1501 XXXX XXXXXX AVENUE
ANNEX G (Section 2.5)
to
CREDIT AGREEMENT
CONDITIONS PRECEDENT FOR PARTIAL RELEASE
OF MORTGAGED PROPERTIES
Each and every of the following conditions precedent must be
satisfied in connection with any release of Lender's Lien on any
Mortgaged Property prior to the Termination Date (and upon the
prior written consent of Lender, which consent may not be
unreasonably withheld by Lender):
(a) No Default or Event of Default shall exist at the time
of or after giving effect to such release.
(b) Not less than twenty (20) days' prior written request
will be given to Lender as to such release.
(c) The effective date of such release will be an Interest
Payment Date and all interest that has accrued on the Loans
through such date will be paid by Borrower to Lender pursuant to
Section 1.4 as a condition precedent to such release (or, if the
effective date of the release is other than on an Interest
Payment Date, Borrower will pay in full, upon request by Lender,
all interest which has accrued on the Loans through the
effective date of such release).
(d) Such release will be evidenced by a release of the
applicable Mortgages or by quitclaim reconveyances of Lender's
rights, titles and interests in and to the applicable Mortgaged
Properties, releases of financing statements filed under the
Uniform Commercial Code, and/or other instruments reasonably
necessary to release the Liens of Lender in such Mortgaged
Properties under the Mortgages. Borrower will be responsible for
preparing the release instruments, for review by Lender. The
form of release instruments (including without limitation those
for any quitclaim reconveynaces) must be reasonably acceptable to
Lender. All out-of-pocket costs incurred by Lender (including
reasonable attorneys' fees) in connection with such release will
by paid or reimbursed by Borrower upon demand.
(e) Borrower shall have made to Lender, as a condition to
such release, on or before the effective date of such release, a
prepayment of the Loans in the amount (if any) by which the
aggregate outstanding principal balance of the Loans immediately
prior to such release would exceed the Borrowing Base after
giving pro forma effect to such release (it being expressly
understood and agreed that the portion of the Borrowing Base
attributable to the Mortgaged Properties that are the subject of
such release will be deducted from the Borrowing Base for
purposes of determining if any such prepayment of the Loans is
required under this paragraph (e)).
(f) Without limiting the provisions of Section 11.3,
Borrower will reimburse Lender for all out-of-pocket fees, costs
and expenses incurred by Lender in connection with such release
(including, without limitation, the reasonable fees and expenses
of Lender's counsel), including without limitation all such fees,
costs or expenses for reviewing the request for such release and
the documentation required to be submitted by Borrower to obtain
the release, and whether or not Lender determines that the above
conditions are satisfied. In addition, all out-of-pocket costs
and expenses related to such release shall be paid by Borrower,
including (but not limited to) reconveyance fees of the trustee,
title insurance fees, recording fees, transfer taxes and other
expenses.
1. AMOUNT AND TERMS OF CREDIT 1
1.1 Credit Facilities 1
1.2 Prepayment 2
1.3 Use of Proceeds 3
1.4 Interest and Applicable Margins 4
1.5 Fees 5
1.6 Receipt of Payments 6
1.7 Application and Allocation of Payments 6
1.8 Loan Account and Accounting 6
1.9 Indemnity 7
1.10 Access 7
1.11 Taxes 8
1.12 Capital Adequacy; Increased Costs; Illegality 8
1.13 Single Loan 9
2. CONDITIONS PRECEDENT 9
2.1 Conditions to the Initial Loans to be made on the
Closing Date 9
2.2 Conditions to Allow Loans to Exceed $15,000,000 10
2.3 Conditions to Allow Loans to Exceed $25,000,000 11
2.4 Further Conditions to Each Loan 14
2.5 Conditions Precedent for Partial Release of
Mortgaged Properties 15
3. REPRESENTATIONS AND WARRANTIES 15
3.1 Corporate Existence; Compliance with Law 15
3.2 Executive Offices; FEIN 15
3.3 Power, Authorization, Enforceable Obligations 16
3.4 Financial Statements 16
3.5 Material Adverse Effect 16
3.6 Ownership of Property; Liens 17
3.7 Labor Matters 17
3.8 Ventures, Subsidiaries and Affiliates; Outstanding
Stock and Indebtedness 17
3.9 Government Regulation 17
3.10 Margin Regulations 18
3.11 Taxes 18
3.12 ERISA 18
3.13 No Litigation 19
3.14 Brokers 20
3.15 Intellectual Property 20
3.16 Full Disclosure 20
3.17 Environmental Matters 20
3.18 Insurance 21
3.19 Solvency 21
4. FINANCIAL STATEMENTS AND INFORMATION 21
4.1 Reports and Notices 21
4.2 Communication with Accountants 21
5. AFFIRMATIVE COVENANTS 22
5.1 Maintenance of Existence and Conduct of Business 22
5.2 Payment of Obligations 22
5.3 Books and Records 22
5.4 Insurance; Damage to or Destruction of Collateral 22
5.5 Compliance with Laws 24
5.6 Supplemental Disclosure 24
5.7 Intellectual Property 25
5.8 Environmental Matters 25
5.9 Further Assurances 25
5.10 Additional Subsidiary Guarantors 26
5.11 Certain Covenants Relating to the Collateral 26
6. NEGATIVE COVENANTS 28
6.1 Mergers, Subsidiaries, Etc 28
6.2 Investments; Reimbursement Obligations and
Advances 30
6.3 Indebtedness 31
6.4 Employee Reimbursement Obligations and Affiliate
Transactions 32
6.5 Capital Structure and Business 32
6.6 Guaranteed Indebtedness 32
6.7 Liens 33
6.8 Sale of Stock and Assets 33
6.9 ERISA 34
6.10 Financial Covenants 34
6.11 Hazardous Materials 34
6.12 Cancellation of Indebtedness 34
6.13 Restricted Payments 34
6.14 Change of Corporate Name or Location; Change of
Fiscal Year 35
6.15 No Impairment of Intercompany Transfers 36
6.16 No Speculative Transactions 36
6.17 Term Debt and Sale-Leaseback Debt 36
7. TERM 36
7.1 Termination 36
7.2 Survival of Obligations Upon Termination of
Financing Arrangements 36
7.3 Termination and Release of Mortgages 37
8. EVENTS OF DEFAULT; RIGHTS AND REMEDIES 37
8.1 Events of Default 37
8.2 Remedies 39
8.3 Waivers by Credit Parties 39
9. PARTICIPATIONS 39
9.1 Participations 39
10. SUCCESSORS AND ASSIGNS 40
10.1 Successors and Assigns 40
11. MISCELLANEOUS 41
11.1 Complete Agreement; Modification of Agreement 41
11.2 Amendments and Waivers 41
11.3 Fees and Expenses 41
11.4 No Waiver 42
11.5 Remedies 42
11.6 Severability 42
11.7 Conflict of Terms 43
11.8 Confidentiality 43
11.9 GOVERNING LAW 43
11.10 Notices 44
11.11 Section Titles 44
11.12 Counterparts 44
11.13 WAIVER OF JURY TRIAL 45
11.14 Press Releases and Related Matters 45
11.15 Reinstatement 45
11.16 Advice of Counsel 45
11.17 No Strict Construction 45
11.18 Appointment of Agent for Service of Process 46
