[CONFORMED COPY]
EXHIBIT 10.1
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PANAVISION INC.
_____________________________
CREDIT AGREEMENT
Dated as of June 5, 1997
______________________________
THE CHASE MANHATTAN BANK,
as Administrative Agent
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only.
Page
Section 1. Definitions and Accounting Matters . . . . . . . . . . . . . 1
1.01 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . 1
1.02 Accounting Terms and Determinations . . . . . . . . . . . . . 28
1.03 Classes, Currencies and Types of Loans; Sub-Classes
of Revolving Credit Loans . . . . . . . . . . . . . . . . . 30
Section 2. Commitments, Loans, Evidence of Debt and Prepayments. . . . 30
2.01 Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.02 Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . 33
2.03 Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . 33
2.04 Changes of Commitments . . . . . . . . . . . . . . . . . . . . 39
2.05 Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . 41
2.06 Lending Offices. . . . . . . . . . . . . . . . . . . . . . . . 41
2.07 Several Obligations; Remedies Independent. . . . . . . . . . . 41
2.08 Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . 42
2.09 Optional Prepayments and Conversions or Continuations
of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . 43
2.10 Mandatory Prepayments and Reductions of Commitments. . . . . . 43
Section 3. Payments of Principal and Interest. . . . . . . . . . . . . . 48
3.01 Repayment of Loans . . . . . . . . . . . . . . . . . . . . . . 48
3.02 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 4. Payments; Pro Rata Treatment; Computations; Etc . . . . . . . 50
4.01 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
4.02 Pro Rata Treatment . . . . . . . . . . . . . . . . . . . . . . 51
4.03 Computations . . . . . . . . . . . . . . . . . . . . . . . . . 52
4.04 Minimum Amounts. . . . . . . . . . . . . . . . . . . . . . . . 52
4.05 Certain Notices. . . . . . . . . . . . . . . . . . . . . . . . 53
4.06 Non-Receipt of Funds by the Administrative Agent . . . . . . . 54
4.07 Sharing of Payments, Etc.. . . . . . . . . . . . . . . . . . . 55
Section 5. Yield Protection, Etc . . . . . . . . . . . . . . . . . . . . 57
5.01 Additional Costs . . . . . . . . . . . . . . . . . . . . . . . 57
5.02 Limitation on Types of Loans . . . . . . . . . . . . . . . . . 59
5.03 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . 60
5.04 Treatment of Affected Loans. . . . . . . . . . . . . . . . . . 60
5.05 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . 62
5.06 Additional Costs in Respect of Letters of Credit . . . . . . . 62
5.07 U.S. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 63
5.08 Replacement Lenders. . . . . . . . . . . . . . . . . . . . . . 65
(i)
Section 6. Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . 66
6.01 The Guarantee. . . . . . . . . . . . . . . . . . . . . . . . . 66
6.02 Obligations Unconditional. . . . . . . . . . . . . . . . . . . 66
6.03 Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . 68
6.04 Subrogation. . . . . . . . . . . . . . . . . . . . . . . . . . 68
6.05 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
6.06 Instrument for the Payment of Money. . . . . . . . . . . . . . 68
6.07 Continuing Guarantee . . . . . . . . . . . . . . . . . . . . . 69
6.08 Rights of Contribution . . . . . . . . . . . . . . . . . . . . 69
6.09 General Limitation on Guarantee Obligations. . . . . . . . . . 70
Section 7. Conditions Precedent. . . . . . . . . . . . . . . . . . . . . 70
7.01 Effectiveness and Initial Extension of Credit. . . . . . . . . 70
7.02 Initial and Subsequent Extensions of Credit. . . . . . . . . . 74
Section 8. Representations and Warranties. . . . . . . . . . . . . . . . 74
8.01 Existence. . . . . . . . . . . . . . . . . . . . . . . . . . . 74
8.02 Financial Condition. . . . . . . . . . . . . . . . . . . . . . 75
8.03 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.04 No Breach. . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.05 Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
8.06 Approvals. . . . . . . . . . . . . . . . . . . . . . . . . . . 77
8.07 Use of Credit. . . . . . . . . . . . . . . . . . . . . . . . . 77
8.08 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
8.09 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
8.10 Investment Company Act . . . . . . . . . . . . . . . . . . . . 78
8.11 Public Utility Holding Company Act . . . . . . . . . . . . . . 78
8.12 Material Agreements and Liens. . . . . . . . . . . . . . . . . 78
8.13 Environmental Matters. . . . . . . . . . . . . . . . . . . . . 79
8.14 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . 79
8.15 Subsidiaries, Etc. . . . . . . . . . . . . . . . . . . . . . . 80
8.16 Title to Assets. . . . . . . . . . . . . . . . . . . . . . . . 81
8.17 True and Complete Disclosure . . . . . . . . . . . . . . . . . 81
Section 9. Covenants of the Borrower . . . . . . . . . . . . . . . . . . 82
9.01 Financial Statements Etc.. . . . . . . . . . . . . . . . . . . 82
9.02 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . 86
9.03 Existence, Etc.. . . . . . . . . . . . . . . . . . . . . . . . 87
9.04 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . 87
9.05 Prohibition of Fundamental Changes . . . . . . . . . . . . . . 88
9.06 Limitation on Liens. . . . . . . . . . . . . . . . . . . . . . 91
9.07 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . 93
9.08 Investments. . . . . . . . . . . . . . . . . . . . . . . . . . 93
9.09 Restricted Payments. . . . . . . . . . . . . . . . . . . . . . 94
9.10 Certain Financial Covenants. . . . . . . . . . . . . . . . . . 95
9.11 Subordinated Indebtedness. . . . . . . . . . . . . . . . . . . 97
9.12 Lines of Business. . . . . . . . . . . . . . . . . . . . . . . 97
9.13 Transactions with Affiliates . . . . . . . . . . . . . . . . . 98
9.14 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . 98
9.15 Certain Obligations Respecting Subsidiaries. . . . . . . . . . 99
9.16 Modifications of Certain Documents . . . . . . . . . . . . . . 101
(ii)
Section 10. Events of Default. . . . . . . . . . . . . . . . . . . . . . 101
Section 11. The Administrative Agent . . . . . . . . . . . . . . . . . . 106
11.01 Appointment, Powers and Immunities. . . . . . . . . . . . . . 106
11.02 Reliance by Administrative Agent. . . . . . . . . . . . . . . 107
11.03 Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . 107
11.04 Rights as a Lender. . . . . . . . . . . . . . . . . . . . . . 108
11.05 Indemnification . . . . . . . . . . . . . . . . . . . . . . . 108
11.06 Non-Reliance on Administrative Agent and Other Lenders. . . . 109
11.07 Failure to Act. . . . . . . . . . . . . . . . . . . . . . . . 109
11.08 Resignation or Removal of Administrative Agent. . . . . . . . 110
11.09 Consents under Other Loan Documents . . . . . . . . . . . . . 110
Section 12. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . 111
12.01 Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
12.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
12.03 Expenses, Etc.. . . . . . . . . . . . . . . . . . . . . . . . 111
12.04 Amendments, Etc.. . . . . . . . . . . . . . . . . . . . . . . 113
12.05 Successors and Assigns. . . . . . . . . . . . . . . . . . . . 114
12.06 Assignments and Participations. . . . . . . . . . . . . . . . 114
12.07 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . 118
12.08 Captions. . . . . . . . . . . . . . . . . . . . . . . . . . . 118
12.09 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . 118
12.10 Governing Law; Submission to Jurisdiction . . . . . . . . . . 118
12.11 Waiver of Jury Trial. . . . . . . . . . . . . . . . . . . . . 119
12.12 Treatment of Certain Information; Confidentiality . . . . . . 119
SCHEDULE I - Commitments
SCHEDULE II - Material Agreements and Liens
SCHEDULE III - Subsidiaries and Investments
SCHEDULE IV - Equity Interests of the Borrower
SCHEDULE V - Litigation
SCHEDULE VI - Taxes
SCHEDULE VII - Environmental Matters
EXHIBIT A - Form of Incremental Term Loan Activation Notice
EXHIBIT B - Form of Security Agreement
EXHIBIT C - Form of Opinion of Special New York Counsel to the Obligors
EXHIBIT D - Form of Opinion of Special New York Counsel to Chase
EXHIBIT E - Form of Guarantee Assumption Agreement
EXHIBIT F - Form of Confidentiality Agreement
EXHIBIT G - Form of Assignment and Acceptance
(iii)
CREDIT AGREEMENT dated as of June 5, 1997 between: PANAVISION INC., a
Delaware corporation (the "BORROWER"); each of the Subsidiaries of the
Borrower identified under the caption "SUBSIDIARY GUARANTORS" on the
signature pages hereof and each Subsidiary of the Borrower that becomes a
"Subsidiary Guarantor" after the date hereof pursuant to Section 9.15(a)
hereof (individually, a "SUBSIDIARY GUARANTOR" and, collectively, the
"SUBSIDIARY GUARANTORS" and, together with the Borrower, the "OBLIGORS");
each of the lenders that is a signatory hereto identified under the caption
"LENDERS" on the signature pages hereto and each lender that becomes a
"Lender" after the date hereof pursuant to Section 12.06(b) hereof
(individually, a "LENDER" and, collectively, the "LENDERS"); and THE CHASE
MANHATTAN BANK, as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the "ADMINISTRATIVE AGENT").
The Borrower has requested that the Lenders extend credit to the
Borrower, under the guarantee of the Subsidiary Guarantors, in an aggregate
principal or face amount not to exceed $150,000,000 at any one time
outstanding to finance the Visual Action Acquisition (as defined below) and
the payment of fees, commissions and expenses payable in connection
therewith, to refinance loans outstanding under the Existing Credit Agreement
(as defined below) and to provide funds for the general corporate purposes of
the Borrower and its Subsidiaries. The Lenders are prepared to extend such
credit upon the terms and conditions hereof and, accordingly, the parties
hereto agree as follows:
Section 1. DEFINITIONS AND ACCOUNTING MATTERS.
1.01 CERTAIN DEFINED TERMS. As used herein, the following terms shall
have the following meanings (all terms defined in this Section 1.01 or in
other provisions of this Agreement in the singular to have the same meanings
when used in the plural and VICE VERSA):
"ACQUIRED ENTITY" shall mean any business, assets or Person subject to
an Acquisition permitted under Section 9.05(b)(iv) hereof.
"ACQUISITION" shall mean any transaction, or any series of related
transactions, consummated after the date of this Agreement, by which the
Borrower and/or any of its Subsidiaries (a) acquires any going business or
all or substantially all of the assets of any corporation, partnership, joint
venture or other firm or any division of any corporation, partnership, joint
venture or other firm or the right to use or manage or otherwise exploit any
such business or assets, whether through purchase or lease of assets, merger
or otherwise, (b) directly or indirectly
CREDIT AGREEMENT
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acquires control of at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election
of directors or (c) directly or indirectly acquires control of a majority
ownership interest in any partnership, joint venture or other firm. The
terms "ACQUIRE" and "ACQUIRED" used as a verb shall have a correlative
meaning.
"ADMINISTRATIVE QUESTIONNAIRE" means an administrative questionnaire in
a form supplied by the Administrative Agent.
"AFFILIATE" shall mean any Person that directly or indirectly controls,
or is under common control with, or is controlled by, the Borrower and, if
such Person is an individual, any member of the immediate family (including
parents, spouse, children and siblings) of such individual and any trust
whose principal beneficiary is such individual or one or more members of such
immediate family and any Person who is controlled by any such member or
trust. As used in this definition, "CONTROL" (including, with its
correlative meanings, "CONTROLLED BY" and "UNDER COMMON CONTROL WITH") shall
mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities
or partnership or other ownership interests, by contract or otherwise),
PROVIDED that, in any event, any Person that owns directly or indirectly
securities having 5% or more of the voting power for the election of
directors or other governing body of a corporation or 5% or more of the
partnership or other ownership interests of any other Person (other than as a
limited partner of such other Person) will be deemed to control such
corporation or other Person. Notwithstanding the foregoing, (a) no
individual shall be an Affiliate solely by reason of his or her being a
director, officer or employee of the Borrower or any of its Subsidiaries and
(b) none of the Wholly Owned Subsidiaries of the Borrower shall be Affiliates.
"APPLICABLE LENDING OFFICE" shall mean, for each Lender and for each
Type and Currency of Loan, the "Lending Office" of such Lender (or of an
affiliate of such Lender) designated for such Type and Currency of Loan on
such Lender's Administrative Questionnaire or such other office of such
Lender (or of an affiliate of such Lender) as such Lender may from time to
time specify to the Administrative Agent and the Borrower as the office by
which its Loans of such Type and Currency are to be made and maintained.
"APPLICABLE FEE RATE" shall mean, during any Accrual Period (as defined
in the definition of "Applicable Margin" in this Section 1.01), the rate
indicated opposite the applicable Total Debt Ratio indicated below for such
Accrual Period:
CREDIT AGREEMENT
- 3 -
RANGE
OF
TOTAL DEBT RATIO APPLICABLE FEE RATE (% P.A.)
------------------------- -------------------------------
Greater than or equal
to 1.75 to 1 0.375%
Greater than or equal
to 1.25 to 1 but
less than 1.75 to 1 0.3125%
Less than 1.25 to 1 0.25%.
The Total Debt Ratio for each Accrual Period shall be determined as set
forth in the definition of "Applicable Margin" in this Section 1.01.
Anything in this Agreement to the contrary notwithstanding, the
Applicable Fee Rate shall be 0.375% (i) during any period when an Event of
Default shall have occurred and be continuing, or (ii) so long as the
Borrower shall be in default of its obligation to deliver any financial
statements pursuant to Section 9.01(b) or 9.01(c) hereof.
"APPLICABLE MARGIN" shall mean, (a) with respect to Revolving Credit
Loans and Tranche A Term Loans of any Type during any Accrual Period (as
defined below), the respective rates indicated below for such Loans opposite
the applicable Total Debt Ratio indicated below for such Accrual Period and
(b) with respect to Incremental Term Loans of any Type, the rate per annum
agreed to by the Borrower and the Incremental Term Loan Lenders and set forth
in the Incremental Term Loan Activation Notice:
RANGE
OF APPLICABLE MARGIN (% P.A.)
TOTAL DEBT RATIO BASE RATE LOANS EUROCURRENCY LOANS
---------------- --------------- ------------------
Greater than or equal
to 2.00 to 1 0% 1.25%
Greater than or equal
to 1.75 to 1 but
less than 2.00 to 1 0% 1.00%
Greater than or equal
to 1.25 to 1 but
less than 1.75 to 1 0% 0.75%
Less than 1.25 to 1 0% 0.625%.
For purposes of this definition and the definition of "Applicable Fee
Rate", an "ACCRUAL PERIOD" shall mean the period commencing
CREDIT AGREEMENT
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during any fiscal quarter on the date (the "CHANGE DATE") that is the third
Business Day following the receipt by the Administrative Agent of the
certificate referred to in the next following paragraph to but not including
the Change Date in the immediately following fiscal quarter, PROVIDED that
the initial Accrual Period shall commence on the Effective Date and continue
until the Change Date during the fiscal quarter commencing July 1, 1997.
The Total Debt Ratio for the initial Accrual Period shall be determined
on the basis of the certificate of a Senior Officer delivered pursuant to
Section 7.01(m) hereof. The Total Debt Ratio for any Accrual Period after
the initial Accrual Period shall be determined on the basis of a certificate
of a Senior Officer setting forth a calculation of the Total Debt Ratio as at
the last day of the fiscal quarter ending immediately prior to the first day
of such Accrual Period, each of which certificates shall be delivered
together with the financial statements for the fiscal quarter on which such
calculation is based, PROVIDED that, with respect to the last fiscal quarter
of a fiscal year of the Borrower, the Borrower may (but shall not be required
to) provide such certificate and accompanying unaudited financial statements
for such fiscal quarter (of the type contemplated by Section 9.01(b) hereof)
to the Administrative Agent prior to the delivery of the audited financial
statements of the Borrower required to be delivered pursuant to Section
9.01(c) hereof and such certificate shall be the basis for determining the
Total Debt Ratio for purposes of this definition and the definition of
"Applicable Fee Rate".
Anything in this Agreement to the contrary notwithstanding, the
Applicable Margin for Revolving Credit Loans or Tranche A Term Loans that are
Eurocurrency Loans shall be the highest rates provided for above (I.E. 1.25%)
(i) during any period when an Event of Default shall have occurred and be
continuing, or (ii) so long as the Borrower shall be in default of its
obligation to deliver any financial statements pursuant to Section 9.01(b) or
9.01(c) hereof.
"AVAILABLE DOLLAR COMMITMENT" shall mean, at any time, for any Revolving
Credit Lender, the Revolving Credit Commitment of such Lender as in effect at
such time MINUS, if such Lender is a Sterling Lender, the Dollar Equivalent
of the aggregate outstanding principal amount of Sterling Loans made by such
Lender.
"BANKRUPTCY CODE" shall mean the Federal Bankruptcy Code of 1978, as
amended from time to time.
"BASE RATE" shall mean, for any day, a rate per annum equal to the
higher of (a) the Federal Funds Rate for such day
CREDIT AGREEMENT
- 5 -
plus 1/2 of 1% and (b) the Prime Rate for such day. Each change in any
interest rate provided for herein based upon the Base Rate resulting from a
change in the Base Rate shall take effect at the time of such change in the
Base Rate.
"BASE RATE LOANS" shall mean Loans that bear interest at rates based
upon the Base Rate.
"BASIC DOCUMENTS" shall mean, collectively, this Agreement, the other
Loan Documents and the Visual Action Acquisition Documents.
"BASLE ACCORD" shall mean the proposals for risk-based capital framework
described by the Basle Committee on Banking Regulations and Supervisory
Practices in its paper entitled "International Convergence of Capital
Measurement and Capital Standards" dated July 1988, as amended, modified and
supplemented and in effect from time to time or any replacement thereof.
"BUSINESS DAY" shall mean any day (a) on which commercial banks are not
authorized or required to close in New York City or London and (b) if such
day relates to a borrowing of, a payment or prepayment of principal of or
interest on, a Conversion of or into, or a Continuation of an Interest Period
for, a Eurocurrency Loan or a notice by the Borrower with respect to any such
borrowing, payment, prepayment, Conversion or a Continuation of an Interest
Period, that is also a day on which dealings in Dollar deposits are carried
out in the London interbank market or on which dealings in Pound Sterling
deposits are carried out in the Paris interbank market, as the case may be.
"CAPITAL EXPENDITURES" shall mean, for any period, expenditures
(including, without limitation, the aggregate amount of assets capitalized
under Capital Lease Obligations incurred during such period) made by the
Borrower or any of its Subsidiaries to acquire or construct fixed assets,
plant and equipment (including renewals, improvements and replacements, but
excluding repairs) during such period computed in accordance with GAAP;
PROVIDED that in calculating Capital Expenditures there shall be excluded any
expenditure to the extent made with the proceeds of any Casualty Event or any
Excluded Disposition.
"CAPITAL LEASE OBLIGATIONS" shall mean, for any Person, all obligations
of such Person to pay rent or other amounts under a lease of (or other
agreement conveying the right to use) Property to the extent such obligations
are required to be classified and accounted for as a capital lease on a
balance sheet of such Person under GAAP, and, for purposes of this Agreement,
the amount of such obligations shall be the capitalized amount thereof,
determined in accordance with GAAP.
CREDIT AGREEMENT
- 6 -
"CASUALTY EVENT" shall mean, with respect to any Property of any Person,
any loss of or damage to, or any condemnation or other taking of, such
Property for which such Person or any of its Subsidiaries receives insurance
proceeds, or proceeds of a condemnation award or other compensation.
"CHASE" shall mean The Chase Manhattan Bank.
"CLASS" shall have the meaning assigned to such term in Section 1.03
hereof.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL ACCOUNT" shall have the meaning assigned to such term in
Section 4.01 of the Security Agreement.
"COMMITMENTS" shall mean, collectively, the Revolving Credit
Commitments, the Tranche A Term Loan Commitments and the Incremental Term
Loan Commitments.
"CONTINUE", "CONTINUATION" and "CONTINUED" shall refer to the
continuation pursuant to Section 2.09 hereof of a Eurocurrency Loan from one
Interest Period to the next Interest Period for such Loan.
"CONVERT", "CONVERSION" and "CONVERTED" shall refer to a conversion
pursuant to Section 2.09 hereof of one Type of Loans into another Type of
Loans, which may be accompanied by the transfer by a Lender (at its sole
discretion) of a Loan from one Applicable Lending Office to another.
"CURRENCY" shall mean Dollars or Pounds Sterling.
"CURRENCY VALUATION NOTICE" shall have the meaning assigned to such term
in Section 2.10(h) hereof.
"DEBT SERVICE" shall mean, for any period, the sum, for the Borrower and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) all regularly scheduled
payments of principal of Indebtedness (including, without limitation, the
principal component of any payments in respect of Capital Lease Obligations)
made during such period PLUS (b) all Interest Expense for such period.
"DEFAULT" shall mean an Event of Default or an event that with notice or
lapse of time or both would become an Event of Default.
CREDIT AGREEMENT
- 7 -
"DISPOSITION" shall mean any sale, assignment, transfer or other
disposition of any Property (whether now owned or hereafter acquired) by the
Borrower or any of its Subsidiaries to any other Person.
"DOLLAR EQUIVALENT" shall mean, with respect to any Sterling Loan, the
amount of Dollars that would be required to purchase the amount of Pounds
Sterling of such Loan on the date such Loan is requested (or, in the case of
any determination made under Section 2.01(e), 2.05(a), 2.09 or 2.10(h)
hereof, on the date specified in such Section), based on the spot selling
rate at which Chase offers to sell Pounds Sterling in Dollars in the London
foreign exchange market at approximately 11:00 a.m. London time for delivery
two Business Days later.
"DOLLAR LOANS" shall mean the Revolving Credit Loans provided for in
Section 2.01(a)(i) hereof, which may be Base Rate Loans and/or Eurodollar
Loans.
"DOLLARS" and "$" shall mean lawful money of the United States of
America.
"EBITDA" shall mean, for any period, the sum, for the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) net income for such period
(calculated after eliminating extraordinary gains and losses and unusual
items) PLUS (b) income and other taxes (to the extent deducted in determining
net income) for such period PLUS (c) depreciation and amortization and other
non-cash charges (to the extent deducted in determining net income) for such
period PLUS (d) the aggregate amount of Interest Expense for such period
MINUS (e) the aggregate amount of interest income for such period PLUS (f)
the aggregate amount of upfront or one-time fees or expenses payable in
respect of Interest Rate Protection Agreements during such period (to the
extent deducted in determining net income for such period) PLUS (g) the
amount of unrealized foreign exchange losses (net of any gains) (or MINUS the
amount of unrealized foreign exchange gains (net of any losses)); PROVIDED
that there shall be added back to the calculation of EBITDA non-cash minority
interests related to Panavision Canada Holdings to the extent deducted in
calculating EBITDA for such period.
"EFFECTIVE DATE" shall mean the date upon which all of the conditions
set forth in Section 7.01 hereof have been satisfied or waived.
"ENVIRONMENTAL LAWS" shall mean any and all present and future Federal,
state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the
regulation or protection of
CREDIT AGREEMENT
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human health, safety or the environment or to emissions, discharges, Releases
or threatened Releases of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes into the indoor or outdoor environment,
including, without limitation, ambient air, soil, surface water, ground
water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, generation, recycling, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes (or the effect of the
same on human health or safety).
"EQUITY ISSUANCE" shall mean (a) any issuance or sale by the Borrower
or any of its Subsidiaries after the Effective Date of (i) any of its capital
stock, (ii) any warrants or options exercisable in respect of its capital
stock (other than any warrants or options issued to directors, officers or
employees of the Borrower or any of its Subsidiaries pursuant to employee
benefit plans established in the ordinary course of business and any capital
stock of the Borrower issued upon the exercise of such warrants or options)
or (iii) any other security or instrument representing an equity interest (or
the right to obtain any equity interest) in the Borrower or any of its
Subsidiaries or (b) the receipt by the Borrower or any of its Subsidiaries
after the Effective Date of any capital contribution (whether or not
evidenced by any equity security issued by the recipient of such
contribution); PROVIDED that Equity Issuance shall not include (w) any such
issuance or sale by any Subsidiary of the Borrower to the Borrower or any
Subsidiary of the Borrower, (x) any capital contribution by the Borrower or
any Subsidiary of the Borrower to any Subsidiary of the Borrower, (y) any
issuance of convertible subordinated debt that constitutes Subordinated
Indebtedness issued in accordance with Section 9.11(a) hereof or (z) any
issuance of equity securities upon the exercise of any conversion right with
respect to such convertible subordinated debt.
"EQUITY RIGHTS" shall mean, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including, without limitation, any stockholders' or
voting trust agreements) for the issuance, sale, registration or voting of,
or securities convertible into, any additional shares of capital stock of any
class, or partnership or other ownership interests of any type in, such
Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA AFFILIATE" shall mean any corporation or trade or business that
is a member of any group of organizations
CREDIT AGREEMENT
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(i) described in Section 414(b) or (c) of the Code of which the Borrower is a
member and (ii) solely for purposes of potential liability under Section
302(c)(11) of ERISA and Section 412(c)(11) of the Code and the lien created
under Section 302(f) of ERISA and Section 412(n) of the Code, described in
Section 414(m) or (o) of the Code of which the Borrower is a member.
"EUROCURRENCY LOANS" shall mean Loans that bear interest at rates based
on rates referred to in the definition of "Eurocurrency Rate" in this Section
1.01.
"EUROCURRENCY RATE" shall mean, for any Interest Period for any
Eurocurrency Loan denominated in either Currency, the rate for deposits in
such Currency for a period comparable to such Interest Period which appears
on Telerate Page 3750 as of 11:00 a.m., London time, on the day that is two
Business Days preceding the first day of such Interest Period; PROVIDED that,
if such rate does not appear on such Telerate Page, the "Eurocurrency Rate"
shall be the arithmetic mean (rounded upwards, if necessary, to the nearest
1/100 of 1%), as determined by the Administrative Agent, of the rates per
annum quoted by the respective Reference Lenders at approximately 11:00 a.m.
London time (or as soon thereafter as practicable) on the date two Business
Days prior to the first day of such Interest Period for the offering by the
respective Reference Lenders to leading banks in the London interbank market
of Dollar deposits or to leading banks in the Paris interbank market of Pound
Sterling deposits, as the case may be, having a term comparable to such
Interest Period and in an amount comparable to the respective principal
amount of such Loan to be made by the respective Reference Lenders for such
Interest Period. If any Reference Lender is not participating in any
Eurocurrency Loan during any Interest Period therefor, the Eurocurrency Rate
for such Interest Period shall be determined by reference to the amount of
the Loan that such Reference Lender would have made or had outstanding during
such Interest Period had it been participating in such Loan during such
Interest Period. If any Reference Lender does not timely furnish the
information required for determination of any Eurocurrency Rate, the
Administrative Agent shall determine such Eurocurrency Rate on the basis of
the information timely furnished by the remaining Reference Lenders.
"EURODOLLAR LOANS" shall mean Eurocurrency Loans denominated in Dollars.
"EUROSTERLING LOANS" shall mean Eurocurrency Loans denominated in
Pounds Sterling.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Section 10 hereof.
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"EXCESS CASH FLOW" shall mean, for any period, (a) EBITDA for such
period MINUS (b) the sum of (i) the aggregate amount of Debt Service for such
period PLUS (ii) taxes payable in cash in respect of such period PLUS (iii)
Capital Expenditures made during such period (except for any such Capital
Expenditures to the extent financed with the proceeds of Indebtedness, or
Capital Lease Obligations, incurred pursuant to Section 9.07(e) hereof during
such period) PLUS (iv) any increase (or MINUS any decrease) in Working
Capital from the beginning of such period to the end of such period PLUS (v)
cash receipts during such period in respect of any gains to the extent not
required pursuant to Section 2.10(a) or 2.10(d) hereof to be applied to the
prepayment of Loans and/or the reduction of Commitments (or MINUS cash
receipts during such period in respect of losses relating thereto) PLUS (vi)
the aggregate amount of prepayments made under Section 2.09 hereof during
such period PLUS (vii) the amount of any Restricted Payment (other than any
taxes payable in cash pursuant to clause (i) of this definition) paid during
such period as permitted pursuant to Section 9.09 hereof.
"EXCLUDED DISPOSITION" shall mean any Disposition of any Property (a)
sold or disposed of in the ordinary course of business and on ordinary
business terms (including sales of inventory and obsolete, worn-out or
surplus Property) and (b) any other dispositions of Property, to the extent
that the proceeds of such disposition are used to acquire other Property used
or useful in the business of the Borrower or any of its Subsidiaries within a
period of 60 days after the end of the fiscal quarter in which such
disposition was made.
"EXISTING CREDIT AGREEMENT" shall mean the Second Amended and Restated
Credit Agreement dated as of December 5, 1996 between PILP, the subsidiary
guarantors named therein, the lenders party thereto and The Chase Manhattan
Bank, as administrative agent for such lenders.
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the
Business Day next succeeding such day, PROVIDED that (a) if the day for which
such rate is to be determined is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day and (b) if
such rate is not so published for any Business Day, the Federal Funds Rate
for such Business Day shall be the average rate charged to Chase on such
Business Day on such transactions as determined by the
CREDIT AGREEMENT
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Administrative Agent.
"FIXED CHARGES" shall mean, for any period, the sum of (i) Debt Service
for such period PLUS (ii) taxes payable in cash in respect of such period.
"FIXED CHARGES RATIO" shall mean, as at any date, the ratio of (a)
EBITDA for the period of four consecutive fiscal quarters ending on or most
recently ended prior to such date MINUS Capital Expenditures for such period
to (b) Fixed Charges for such period.
"FOREIGN SUBSIDIARY" shall have the meaning assigned to such term in
Section 9.15(a) hereof.
"GAAP" shall mean generally accepted accounting principles applied on a
basis consistent with those that, in accordance with the last sentence of
Section 1.02(a) hereof, are to be used in making the calculations for
purposes of determining compliance with this Agreement.
"GUARANTEE" shall mean a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of,
or otherwise to be or become contingently liable under or with respect to,
the Indebtedness, other obligations, net worth, working capital or earnings
of any Person, or a guarantee of the payment of dividends or other
distributions upon the stock or equity interests of any Person, or an
agreement to purchase, sell or lease (as lessee or lessor) Property,
products, materials, supplies or services primarily for the purpose of
enabling a debtor to make payment of such debtor's obligations or an
agreement to assure a creditor against loss, and including, without
limitation, causing a bank or other financial institution to issue a letter
of credit or other similar instrument for the benefit of another Person, but
excluding endorsements for collection or deposit in the ordinary course of
business. The terms "GUARANTEE" and "GUARANTEED" used as a verb shall have a
correlative meaning.
"GUARANTEE ASSUMPTION AGREEMENT" shall mean a Guarantee Assumption
Agreement substantially in the form of Exhibit E hereto by an entity that,
pursuant to Section 9.15(a) hereof is required to become a "Subsidiary
Guarantor" hereunder in favor of the Administrative Agent.
"HAZARDOUS MATERIAL" shall mean, collectively, (a) any petroleum or
petroleum products, flammable materials, explosives, radioactive materials,
asbestos, urea formaldehyde foam insulation, and transformers or other
equipment that contain polychlorinated biphenyls ("PCB's"), (b) any chemicals
or other materials or substances that are now or hereafter become defined
CREDIT AGREEMENT
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as or included in the definition of "hazardous substances", "hazardous
wastes", "hazardous materials", "extremely hazardous wastes", "restricted
hazardous wastes", "toxic substances", "toxic pollutants", "contaminants" or
"pollutants" under any Environmental Law and (c) any other chemical or other
material or substance, exposure to which is now or hereafter prohibited,
limited or regulated under any Environmental Law.
"INCREMENTAL TERM LOAN ACTIVATION DATE" shall mean the date designated
as such in the Incremental Term Loan Activation Notice.
"INCREMENTAL TERM LOAN ACTIVATION NOTICE" shall mean a notice
substantially in the form of Exhibit A hereto.
"INCREMENTAL TERM LOAN COMMITMENT" shall mean, for each Incremental
Term Loan Lender, on and after the Incremental Term Loan Activation Date, the
obligation of such Incremental Term Loan Lender to make or continue
Incremental Term Loans in an aggregate principal amount up to but not
exceeding the amount set opposite the name of such Incremental Term Loan
Lender on the Incremental Term Loan Activation Notice under the caption
"Incremental Term Loan Commitment" or, in the case of any Person that becomes
an Incremental Term Loan Lender pursuant to an assignment permitted under
Section 12.06(b) hereof, as specified in the respective instrument of
assignment pursuant to which such assignment is effected (as the same may be
reduced or increased pursuant to an assignment permitted under Section
12.06(b) hereof). The aggregate principal amount of the Incremental Term
Loan Commitments on the date hereof is zero and shall not exceed $50,000,000.
"INCREMENTAL TERM LOAN COMMITMENT TERMINATION DATE" shall mean the date
designated as such in the Incremental Term Loan Activation Notice.
"INCREMENTAL TERM LOAN LENDERS" shall mean the Lenders from time to
time holding Incremental Term Loans and/or Incremental Term Loan Commitments
(including after giving effect to any assignments thereof permitted by
Section 12.06(b) hereof).
"INCREMENTAL TERM LOAN PRINCIPAL PAYMENT DATES" shall mean the
Quarterly Dates specified as such in the Incremental Term Loan Activation
Notice.
"INCREMENTAL TERM LOANS" shall mean the loans provided for by Section
2.01(b) hereof, which may be Base Rate Loans and/or Eurodollar Loans.
"INDEBTEDNESS" shall mean, for any Person: (a) obligations created,
issued or incurred by such Person for
CREDIT AGREEMENT
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borrowed money (whether by loan, the issuance and sale of debt securities or
the sale of Property to another Person subject to an understanding or
agreement, contingent or otherwise, to repurchase such Property from such
Person); (b) obligations of such Person to pay the deferred purchase or
acquisition price of Property or services (including in respect of
non-competition agreements), other than trade accounts payable (other than
for borrowed money) arising, and accrued expenses incurred, in the ordinary
course of business so long as such trade accounts payable are payable within
180 days of the date the respective goods are delivered or the respective
services are rendered; (c) Indebtedness of others secured by a Lien on the
Property of such Person, whether or not the respective indebtedness so
secured has been assumed by such Person; (d) obligations of such Person in
respect of letters of credit or similar instruments issued or accepted by
banks and other financial institutions for account of such Person; (e)
Capital Lease Obligations of such Person; and (f) Indebtedness of others
Guaranteed by such Person.
"INFORMATION MEMORANDUM" shall mean the Confidential Information
Memorandum dated May, 1997 prepared by the Borrower with respect to the
credit facilities referred to in this Agreement.
"INTEREST COVERAGE RATIO" shall mean, as at any date, the ratio of (a)
EBITDA for the period of four consecutive fiscal quarters ending on or most
recently ended prior to such date to (b) Interest Expense of the Borrower and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP) for such period.
"INTEREST EXPENSE" shall mean, for any period, the sum, for any Person
and its Subsidiaries (determined on a consolidated basis without duplication
in accordance with GAAP), of the following: (a) all interest in respect of
Indebtedness (including, without limitation, the interest component of any
payments in respect of Capital Lease Obligations but excluding any
capitalized financing costs) accrued or capitalized during such period
(whether or not actually paid during such period), but excluding any non-cash
interest PLUS (b) the net amount payable (or MINUS the net amount receivable)
under Interest Rate Protection Agreements during such period (whether or not
actually paid or received during such period). For purposes hereof, the
aggregate amount of upfront or one-time fees or expenses payable in respect
of Interest Rate Protection Agreements shall be amortized over the life of
the respective Interest Rate Protection Agreements in equal installments, and
only the portion thereof so amortized during any period shall be treated as
"Interest Expense" for such period.
CREDIT AGREEMENT
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"INTEREST PERIOD" shall mean, for any Eurocurrency Loan, each period
commencing on the date such Eurocurrency Loan is made or, in the case of a
Eurodollar Loan, Converted from a Base Rate Loan or (in the event of a
Continuation) the last day of the next preceding Interest Period for such
Loan and (subject to the provisions of Section 2.01(d) hereof) ending on the
numerically corresponding day in the first, second, third or sixth calendar
month thereafter, as the Borrower may select as provided in Section 4.05
hereof, except that each Interest Period that commences on the last Business
Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on
the last Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing:
(i) no Interest Period for any Revolving Credit Loan may commence
before and end after any Revolving Credit Commitment Reduction Date unless,
after giving effect thereto, the aggregate principal amount of the
Revolving Credit Loans having Interest Periods that end after such
Revolving Credit Commitment Reduction Date shall be equal to or less than
the aggregate amount of the Revolving Credit Commitments on such Commitment
Reduction Date;
(ii) no Interest Period for any Tranche A Term Loan or Incremental
Term Loan may commence before and end after any Tranche A Term Loan
Principal Payment Date or Incremental Term Loan Principal Payment Date,
respectively, unless, after giving effect thereto, the aggregate principal
amount of the Tranche A Term Loans or Incremental Term Loans having Interest
Periods that end after such Tranche A Term Loan Principal Payment Date or
Incremental Term Loan Principal Payment Date, as the case may be, shall be
equal to or less than the aggregate principal amount of the Tranche A Term
Loans or Incremental Term Loans scheduled to be outstanding after giving
effect to the payments of principal required to be made on such Tranche A
Term Loan Principal Payment Date or Incremental Term Loan Principal Payment
Date;
(iii) each Interest Period that would otherwise end on a day that is
not a Business Day shall end on the next succeeding Business Day (or, in
the case of an Interest Period for a Eurocurrency Loan, if such next
succeeding Business Day falls in the next succeeding calendar month, on the
next preceding Business Day); and
(iv) notwithstanding clauses (i) and (ii) above, no Interest Period
shall have a duration of less than one month and, if the Interest Period
for any Eurocurrency Loan would otherwise be a shorter period, such Loan
shall not be
CREDIT AGREEMENT
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available hereunder for such period.
"INTEREST RATE PROTECTION AGREEMENT" shall mean, for any Person, an
interest rate swap, cap or collar agreement or similar arrangement between
such Person and one or more financial institutions providing for the transfer
or mitigation of interest risks either generally or under specific
contingencies.
"INVESTMENT" shall mean, for any Person: (a) the acquisition (whether
for cash, Property, services or securities or otherwise) of capital stock,
bonds, notes, debentures, partnership or other ownership interests or other
securities of any other Person or any agreement to make any such acquisition
(including, without limitation, any "short sale" or any sale of any
securities at a time when such securities are not owned by the Person
entering into such sale); (b) the making of any deposit with, or advance,
loan or other extension of credit to, any other Person (including the
purchase of Property from another Person subject to an understanding or
agreement, contingent or otherwise, to resell such Property to such Person);
(c) the entering into of any Guarantee of, or other contingent obligation
with respect to, Indebtedness or other liability of any other Person and
(without duplication) any amount committed to be advanced, lent or extended
to such Person; or (d) the entering into of any Interest Rate Protection
Agreement or any "swap agreement" (as defined in Section 101(53)(b) of the
Bankruptcy Code).
"ISSUING LENDER" shall mean Chase, as the issuer of Letters of Credit
under Section 2.03 hereof, together with its successors and assigns in such
capacity.
"LETTER OF CREDIT" shall have the meaning assigned to such term in
Section 2.03 hereof.
"LETTER OF CREDIT DOCUMENTS" shall mean, with respect to any Letter of
Credit, collectively, any application therefor and any other agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to
such Letter of Credit or (b) any collateral security for any of such
obligations, each as the same may be modified and supplemented and in effect
from time to time.
"LETTER OF CREDIT INTEREST" shall mean, for each Revolving Credit
Lender, such Lender's participation interest (or, in the case of the Issuing
Lender, the Issuing Lender's retained interest) in the Issuing Lender's
liability under Letters of Credit and such Lender's rights and interests in
Reimbursement Obligations and fees, interest and other amounts
CREDIT AGREEMENT
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payable in connection with Letters of Credit and Reimbursement Obligations.
"LETTER OF CREDIT LIABILITY" shall mean, without duplication, at any
time and in respect of any Letter of Credit, the sum of (a) the undrawn face
amount of such Letter of Credit PLUS (b) the aggregate unpaid principal
amount of all Reimbursement Obligations of the Borrower at such time due and
payable in respect of all drawings made under such Letter of Credit. For
purposes of this Agreement, a Revolving Credit Lender (other than the Issuing
Lender) shall be deemed to hold a Letter of Credit Liability in an amount
equal to its participation interest in the related Letter of Credit under
Section 2.03 hereof, and the Issuing Lender shall be deemed to hold a Letter
of Credit Liability in an amount equal to its retained interest in the
related Letter of Credit after giving effect to the acquisition by the
Revolving Credit Lenders other than the Issuing Lender of their participation
interests under said Section 2.03.
"LETTER OF CREDIT LIMIT" shall mean $5,000,000.
"LIEN" shall mean, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this Agreement and the other Loan Documents,
a Person shall be deemed to own subject to a Lien any Property that 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
(other than an operating lease) relating to such Property.
"LOAN DOCUMENTS" shall mean, collectively, this Agreement, any
promissory notes issued pursuant hereto, the Letter of Credit Documents and
the Security Documents.
"LOANS" shall mean, collectively, the Revolving Credit Loans and the
Term Loans.
"MAJORITY LENDERS" shall mean Lenders holding in the aggregate 51% of
the Commitments and Loans.
"MAJORITY REVOLVING CREDIT LENDERS" shall mean Revolving Credit Lenders
having at least 51% of the aggregate amount of the Revolving Credit
Commitments or, if the Revolving Credit Commitments shall have terminated,
Lenders holding at least 51% of the sum of (a) the aggregate unpaid principal
amount of the Revolving Credit Loans plus (b) the aggregate amount of all
Letter of Credit Liabilities.
"MANAGEMENT GROUP" shall mean, collectively, Xxxxxxx X.
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Xxxxx, Xxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxxxxx.
"MARGIN STOCK" shall mean "margin stock" within the meaning of
Regulations G, T, U and X.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on (a) the
Property, business, operations, financial condition, prospects or liabilities
of the Borrower and its Subsidiaries taken as a whole, (b) the ability of any
Obligor to perform its obligations under any of the Loan Documents to which
it is a party, (c) the validity or enforceability of any of the Loan
Documents, (d) the rights and remedies of the Lenders and the Administrative
Agent under any of the Loan Documents or (e) the timely payment of the
principal of or interest on the Loans or the Reimbursement Obligations or
other amounts payable in connection therewith.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been made by the Borrower
or any ERISA Affiliate and that is covered by Title IV of ERISA.
"NET AVAILABLE PROCEEDS" shall mean:
(i) in the case of any Disposition, the amount of Net Cash
Payments received in connection with such Disposition;
(ii) in the case of any Casualty Event, the aggregate amount of
proceeds of insurance, condemnation awards and other compensation received
by the Borrower and its Subsidiaries in respect of such Casualty Event net
of (A) reasonable expenses incurred by the Borrower and its Subsidiaries in
connection therewith, (B) contractually required repayments of Indebtedness
to the extent secured by a Lien on such Property or contractually required
payments to a lessor in respect of such Property and (C) any income and
transfer taxes payable by the Borrower or any of its Subsidiaries in respect
of such Casualty Event;
(iii) in the case of any Equity Issuance, the aggregate amount of
all cash received by the Borrower and/or its Subsidiaries in respect of
such Equity Issuance net of expenses incurred by the Borrower and/or its
Subsidiaries in connection therewith; and
(iv) in the case of any issuance or incurrence of Indebtedness, the
aggregate amount of all cash received by the Borrower and its Subsidiaries
in respect of such Indebtedness net of expenses incurred by the Borrower
and its Subsidiaries in connection therewith.
CREDIT AGREEMENT
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"NET CASH PAYMENTS" shall mean, with respect to any Disposition, the
aggregate amount of all cash payments received by the Borrower and/or its
Subsidiaries directly or indirectly in connection with such Disposition;
PROVIDED that: (a) Net Cash Payments shall be net of (i) the amount of any
legal, title and recording tax expenses, commissions and other fees and
expenses paid by the Borrower and/or its Subsidiaries in connection with such
Disposition and (ii) any foreign, U.S. Federal, state and local income or
other taxes (including sales and value added taxes and including taxes
payable in connection with the transfer of funds to the Borrower or any of
its Subsidiaries in connection with a prepayment pursuant to Section 2.10(d)
hereof) estimated to be payable by the Borrower and its Subsidiaries as a
result of such Disposition; (b) Net Cash Payments shall be net of any
repayments by the Borrower and/or any of its Subsidiaries of Indebtedness to
the extent that (i) such Indebtedness is secured by a Lien on the Property
that is the subject of such Disposition and (ii) the transferee of (or holder
of a Lien on) such Property requires that such Indebtedness be repaid as a
condition to the purchase of such Property; and (c) Net Cash Payments shall
be net of appropriate amounts to be provided by the Borrower and/or any of
its Subsidiaries as a reserve (whether or not contained in an escrow or
similar arrangement) against any liabilities associated with such Disposition
and retained by the Borrower and/or any such Subsidiary after such
Disposition, including pension and other post-retirement liabilities,
liabilities relating to environmental matters and liabilities under
indemnification obligations associated with such Disposition.
"NEW ZEALAND ACQUISITION AGREEMENT" shall mean the Share Sale Agreement
dated as of May 18, 1997 between Visual Action Holdings and the Borrower.
"NEW ZEALAND PLEDGE AGREEMENT" shall mean the Share Charge Agreement
dated June 5, 1997 pursuant to which the Borrower grants to the
Administrative Agent a security interest in shares of capital stock of Visual
Action NZ, as the same shall be modified and supplemented and in effect from
time to time.
"PANAVISION CANADA HOLDINGS" shall mean Panavision Canada Holdings Inc.,
a Canada corporation.
"PANAVISION EUROPE" means Panavision Europe Limited, a U.K. limited
company.
"PANAVISION LUXEMBOURG" means Panavision Luxembourg S.a.r.l., a
Luxembourg corporation.
"PANAVISION U.K. L.P." means Panavision U.K. L.P., a U.K. limited
partnership.
CREDIT AGREEMENT
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"PBGC" shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED INVESTMENTS" shall mean, with respect to any Person: (a)
direct obligations of the United States of America, or of any agency thereof,
or obligations guaranteed as to principal and interest by the United States
of America, or of any agency thereof, in either case maturing not more than
360 days from the date of acquisition thereof; (b) U.S. dollar denominated
(or, with respect to Foreign Subsidiaries, U.S. dollar denominated and
non-U.S. dollar denominated) time deposits and certificates of deposit of (i)
any Lender or (ii) any domestic (or, with respect to Foreign Subsidiaries,
any domestic or nondomestic) bank or trust company having capital, surplus
and undivided profits of at least $500,000,000, maturing not more than 360
days from the date of acquisition thereof; (c) repurchase obligations with
respect to obligations of the type (but not necessarily the maturity)
described in clause (a) above issued by any bank or trust company described
in clause (b) above and maturing not more than 270 days from the date of
acquisition thereof by such Person; (d) commercial paper rated A-1 or better
or P-1 by Standard & Poor's Ratings Group, a Division of The McGraw Hill
Companies, Inc., or Xxxxx'x Investors Services, Inc., respectively, maturing
not more than 90 days from the date of acquisition thereof; (e) interests in
any money market mutual fund registered under the Investment Company Act of
1940, as amended, the portfolio of which is limited to obligations described
in the foregoing clauses (a), (b), (c) and (d), so long as such fund has
total assets of at least $1,000,000,000 and is rated AAAm-G or better or AAA
or better by Standard & Poor's Ratings Group or Xxxxx'x Investors Services,
Inc., respectively; and (f) the Warburg Pincus Cash Reserve Fund, so long as
substantially all of the investments in the portfolio of such Fund consist of
obligations (i) which are of the type referred to in the foregoing clauses
(a), (b), (c) and (d), and (ii) which mature within one year of the date upon
which they are acquired; in each case so long as the same (x) provide for the
payment of principal and interest (and not principal alone or interest alone)
and (y) are not subject to any contingency regarding the payment of principal
or interest.
"PERSON" shall mean any individual, corporation, company, voluntary
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or government (or any agency, instrumentality or
political subdivision thereof).
"PILP" shall mean Panavision International, L.P., a Delaware limited
partnership.
CREDIT AGREEMENT
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"PLAN" shall mean an employee benefit or other plan established or
maintained by the Borrower or any ERISA Affiliate and that is covered by
Title IV of ERISA, other than a Multiemployer Plan.
"POST-DEFAULT RATE" shall mean a rate per annum equal to 2% PLUS the Base
Rate as in effect from time to time PLUS the Applicable Margin for Base Rate
Loans, PROVIDED that, with respect to principal of a Eurocurrency Loan that
shall become due (whether at stated maturity, by acceleration, by optional or
mandatory prepayment or otherwise) on a day other than the last day of the
Interest Period therefor, the "Post-Default Rate" shall be, for the period
from and including such due date to but excluding the last day of such
Interest Period, 2% PLUS the interest rate for such Loan as provided in
Section 3.02(b) hereof and, thereafter, the rate provided for above in this
definition.
"POUNDS STERLING" and "L" shall mean lawful money of England.
"PRIME RATE" shall mean the rate of interest from time to time announced
by Chase at the principal office of Chase in New York, New York as its prime
commercial lending rate.
"PROPERTY" shall mean any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"PURCHASE PRICE" shall mean with respect to any acquisition under Section
9.05(b)(iv) hereof, an amount equal to the sum of (i) the aggregate
consideration, whether cash, Property or securities (including, without
limitation, any Indebtedness incurred pursuant to Section 9.07(e) hereof),
paid or delivered by the Borrower and its Subsidiaries (but excluding any
fees or expenses payable) in connection with such acquisition PLUS (ii) the
aggregate amount of liabilities of the Acquired Entity (net of current assets
of the Acquired Entity) that would be reflected on a balance sheet (if such
were to be prepared) of the Borrower and its Subsidiaries after giving effect
to such acquisition.
"QUARTERLY DATES" shall mean the last Business Day of March, June,
September and December in each year, the first of which shall be the first
such day after the Effective Date.
"REFERENCE LENDERS" shall mean Chase and each other Lender (if any)
designated as such by the Administrative Agent after the Effective Date (or
their respective Applicable Lending Offices, as the case may be).
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"REGISTERED HOLDER" shall have the meaning assigned to such term in
Section 5.07(a)(ii) hereof.
"REGISTERED LOAN" shall have the meaning assigned to such term in Section
12.06(g) hereof.
"REGULATIONS A, D, G, T, U AND X" shall mean, respectively, Regulations
A, D, G, T, U and X of the Board of Governors of the Federal Reserve System
(or any successor), as the same may be modified and supplemented and in
effect from time to time.
"REGULATORY CHANGE" shall mean, with respect to any Lender, any change
after the Effective Date in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks or other financial institutions including such Lender of or under any
Federal, state or foreign law or regulations (whether or not having the force
of law and whether or not failure to comply therewith would be unlawful) by
any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"REIMBURSEMENT OBLIGATIONS" shall mean, at any time, the obligations of
the Borrower then outstanding, or that may thereafter arise in respect of all
Letters of Credit then outstanding, to reimburse amounts paid by the Issuing
Lender in respect of any drawings under a Letter of Credit.
"RELEASE" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration
into or through ambient air, soil, surface water, ground water, wetlands,
land or subsurface strata.
"RESERVE REQUIREMENT" shall mean, for any Interest Period for any
Eurocurrency Loan, the average maximum rate at which reserves (including,
without limitation, any marginal, supplemental or emergency reserves) are
required to be maintained during such Interest Period under Regulation D by
member banks of the Federal Reserve System in New York City with deposits
exceeding one billion Dollars against "Eurocurrency liabilities" (as such
term is used in Regulation D). Without limiting the effect of the foregoing,
the Reserve Requirement shall include any other reserves required to be
maintained by such member banks by reason of any Regulatory Change with
respect to (i) any category of liabilities that includes deposits by
reference to which the Eurocurrency Rate for any Interest Period for any
Eurocurrency Loans is to be determined as provided in the definition of
"Eurocurrency Rate" in this Section 1.01 or
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(ii) any category of extensions of credit or other assets that includes
Eurocurrency Loans.
"RESTRICTED PAYMENT" shall mean distributions or dividends (in cash,
Property or obligations) on, or other payments on account of, or the setting
apart of money for a sinking or other analogous fund for, or the purchase,
redemption, retirement or other acquisition of, or any shares of any class of
stock of, the Borrower or of any warrants, options or other rights to acquire
the same (or to make any payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference to the fair
market or equity value of the Borrower or any of its Subsidiaries), but
excluding distributions or dividends (or options therein) payable solely in
shares of capital stock of the Borrower.
"REVOLVING CREDIT COMMITMENT" shall mean, as to each Revolving Credit
Lender, the obligation of such Lender to make Revolving Credit Loans, and to
issue or participate in Letters of Credit pursuant to Section 2.03 hereof, in
an aggregate principal or face amount at any one time outstanding up to but
not exceeding the amount set opposite the name of such Lender on Schedule I
hereto under the caption "Revolving Credit Commitment" or, in the case of a
Person that becomes a Revolving Credit Lender pursuant to an assignment
permitted under Section 12.06(b) hereof, as specified in the respective
instrument of assignment pursuant to which such assignment is effected (as
the same may be reduced at any time or from time to time pursuant to Section
2.04 or 2.10 hereof). The original aggregate principal amount of the
Revolving Credit Commitments is $90,000,000. The obligation of each Sterling
Lender to make Sterling Loans to the Borrower in an amount up to but not
exceeding its Sterling Sub-Limit shall constitute a portion of such Lender's
Revolving Credit Commitment.
"REVOLVING CREDIT COMMITMENT PERCENTAGE" shall mean, with respect to any
Revolving Credit Lender, the ratio of (a) the amount of the Revolving Credit
Commitment of such Lender to (b) the aggregate amount of the Revolving Credit
Commitments of all of the Lenders.
"REVOLVING CREDIT COMMITMENT TERMINATION DATE" shall mean the Quarterly
Date falling on or nearest to June 30, 2004.
"REVOLVING CREDIT COMMITMENT REDUCTION DATES" shall mean the Quarterly
Date falling on or nearest to March 31, 1999 and each Quarterly Date
thereafter to and including the Revolving Credit Commitment Termination Date.
"REVOLVING CREDIT LENDERS" shall mean (a) on the date hereof, the Lenders
having Revolving Credit Commitments on
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Schedule I hereto and (b) thereafter, the Lenders from time to time holding
Revolving Credit Loans and Revolving Credit Commitments after giving effect
to any assignments thereof permitted by Section 12.06(b) hereof.
"REVOLVING CREDIT LOANS" shall mean the loans provided for in Section
2.01(a) hereof, which, in the case of Dollar Loans, may be Base Rate Loans or
Eurodollar Loans and, in the case of Sterling Loans, may be Eurosterling
Loans only.
"XXXXXXXXX GROUP" means Xxxxxxxxx Group Limited, a U.K. limited company.
"SECURITY AGREEMENT" shall mean the Security Agreement dated as of June
5, 1997, between the Borrower, certain of the other Obligors and the
Administrative Agent, in substantially the form attached as Exhibit B hereto
and as the same shall be further modified and supplemented and in effect from
time to time.
"SECURITY DOCUMENTS" shall mean, collectively, the Security Agreement,
the New Zealand Pledge Agreement, the U.K. Pledge Agreement, all Uniform
Commercial Code financing statements required by the Security Agreement to be
filed with respect to the security interests in personal Property created
pursuant to the Security Agreement and all filings, recordings, registrations
and/or other similar steps required by the New Zealand Pledge Agreement, the
U.K. Pledge Agreement with respect to the charges created pursuant thereto.
"SENIOR OFFICER" shall mean the chief executive officer or chief
financial officer of the Borrower (it being understood that any individual
acting in the capacity of a Senior Officer shall act on behalf of the
Borrower and not in his or her individual capacity).
"SIGNIFICANT SUBSIDIARY" shall mean, as at any time, any Subsidiary of
the Borrower that has assets in excess of $2,000,000 at such time (or, if
such Subsidiary's assets are denominated in a currency other than Dollars,
the U.S. dollar equivalent thereof).
"STERLING EQUIVALENT" shall mean, with respect to any amount in Dollars,
the amount of Pounds Sterling that could be purchased with such amount of
Dollars using the reciprocal of the foreign exchange rate(s) specified in the
definition of the term "Dollar Equivalent", as determined by the
Administrative Agent.
"STERLING LENDER" shall mean (a) on the date hereof, the Revolving Credit
Lenders having a Sterling Sub-Limit on Schedule I hereto and (b) thereafter,
the Revolving Credit
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Lenders from time to time holding Sterling Loans and having Sterling
Sub-Limits after giving effect to any assignments thereof permitted by
Section 12.06(b) hereof
"STERLING LOANS" shall mean the Revolving Credit Loans provided for in
Section 2.01(a)(ii) hereof, which may be Eurosterling Loans only.
"STERLING SUB-LIMIT" shall mean, as to each Sterling Lender, the
obligation of such Lender to make Revolving Credit Loans, in an aggregate
principal at any one time outstanding up to but not exceeding the amount set
opposite the name of such Lender on Schedule I hereto under the caption
"Sterling Sub-Limit" or, in the case of a Person that becomes a Sterling
Lender pursuant to an assignment permitted under Section 12.06(b) hereof, as
specified in the respective instrument of assignment pursuant to which such
assignment is effected (as the same may be reduced at any time or from time
to time pursuant to Section 2.04 or 2.10 hereof). The original aggregate
principal amount of the Sterling Sub-Limit is the Sterling Equivalent of
$40,000,000. No Sterling Lender's Sub-Limit may exceed such Sterling
Lender's Revolving Credit Commitment LESS an amount equal to such Sterling
Lender's Revolving Credit Commitment Percentage of the Letter of Credit Limit.
"SUB-CLASS" shall have the meaning assigned to such term in Section 1.03
hereof.
"SUBORDINATED INDEBTEDNESS" shall mean Indebtedness of the Borrower or
any of its Subsidiaries incurred in accordance with Section 9.11(a) hereof.
"SUBSIDIARY" shall mean, with respect to any Person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power
to elect a majority of the board of directors or other persons performing
similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have voting power by reason of the happening
of any contingency) is at the time directly or indirectly owned or controlled
by such Person or one or more Subsidiaries of such Person or by such Person
and one or more Subsidiaries of such Person.
"TERM LOAN LENDERS" shall mean, collectively, the Tranche A Term Loan
Lenders and the Incremental Term Loan Lenders (if any).
"TERM LOANS" shall mean, collectively, the Tranche A
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Term Loans and the Incremental Term Loans, if any.
"TOTAL DEBT RATIO" shall mean, as at any date, the ratio of (a) the sum,
for the Borrower and its Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), of the aggregate amount of all
Indebtedness (including, without limitation, all Subordinated Indebtedness,
except as expressly provided below) as at such date to (b) EBITDA for the
period of four consecutive fiscal quarters ending on, or most recently ended
prior to, such date; PROVIDED that in calculating Total Debt Ratio for
purposes of determining the "Applicable Margin" and the "Applicable Fee Rate"
(and for no other purpose), Indebtedness shall not include any Subordinated
Indebtedness of the Borrower or its Subsidiaries.
"TRANCHE A TERM LOAN LENDERS" shall mean (a) on the date hereof, the
Lenders having Term Loan Commitments on Schedule I hereto and (b) thereafter,
the Lenders from time to time holding Term Loan Commitments after giving
effect to any assignments thereof permitted by Section 12.06(b) hereof.
"TRANCHE A TERM LOAN COMMITMENT" shall mean, for each Tranche A Term Loan
Lender, the obligation of such Tranche A Term Loan Lender to make (on the
Effective Date) or Continue Tranche A Term Loans in an amount up to but not
exceeding the amount set opposite the name of such Lender on Schedule I
hereto under the caption "Tranche A Term Loan Commitment" or, in the case of
any Person that becomes a Tranche A Term Loan Lender pursuant to an
assignment permitted under Section 12.06(b) hereof, as specified in the
respective instrument of assignment pursuant to which such assignment is
effected (as the same may be reduced or increased pursuant to an assignment
permitted under Section 12.06(b) hereof). The original aggregate principal
amount of the Tranche A Term Loan Commitments is $60,000,000.
"TRANCHE A TERM LOAN PRINCIPAL PAYMENT DATES" shall mean the Quarterly
Dates falling on or nearest to March 31, June 30, September 30 and December
31 of each year, commencing with March 31, 1998 through and including June
30, 2004.
"TRANCHE A TERM LOANS" shall mean the loans provided for by Section
2.01(b) hereof, which may be Base Rate Loans and/or Eurodollar Loans.
"TYPE" shall have the meaning assigned to such term in Section 1.03
hereof.
"U.K. PERSON" shall mean a citizen or resident of the United Kingdom, a
corporation, partnership or other entity created or organized in or under any
laws of the United Kingdom or any political subdivision thereof, or any
estate or trust that is subject to U.K. income taxation regardless of the
source of
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its income.
"U.K. PLEDGE AGREEMENT" shall mean the Share Charge Agreement dated as of
June 5, 1997 pursuant to which the Borrower grants to the Administrative
Agent a security interest in shares of Panavision Europe, as the same shall
be modified and supplemented and in effect from time to time.
"U.K. TAXES" shall mean any present or future tax, assessment or other
charge or levy imposed by or on behalf of the United States of America or any
taxing authority thereof.
"U.S. ACQUISITION AGREEMENT" shall mean the Share Sale Agreement dated as
of May 18, 1997 between Visual Action Holdings Inc. and the Borrower.
"U.S. PERSON" shall mean a citizen or resident of the United States of
America, a corporation, partnership or other entity created or organized in
or under any laws of the United States of America or any State thereof, or
any estate or trust that is subject to Federal income taxation regardless of
the source of its income.
"U.S. TAXES" shall mean any present or future tax, assessment or other
charge or levy imposed by or on behalf of the United States of America or any
taxing authority thereof.
"VDI" means Xxxxxx Xxxxxx Inc., a Michigan corporation.
"VISUAL ACTION ACQUISITION" shall mean (a) the purchase by Panavision
Europe of the share capital of Xxxxxxxxx Group, (b) the purchase by the
Borrower of the share capital of Visual Action NZ and (c) the purchase by the
Borrower of all issued and outstanding shares of capital stock of VDI.
"VISUAL ACTION ACQUISITION AGREEMENT" shall mean the Agreement for the
sale and purchase of the share capital of Xxxxxxxxx Group dated as of May 18,
1997 between Visual Action Holdings, Panavision Europe and the Borrower.
"VISUAL ACTION ACQUISITION DOCUMENTS" shall mean the Visual Action
Acquisition Agreement, the New Zealand Acquisition Agreement, the U.S.
Acquisition Agreement and all other agreements and instruments (together with
any and all exhibits, annexes and schedules thereto) executed and delivered
between any of Visual Action Holdings, Visual Action Holdings Inc., Visual
Action NZ, the Borrower, Panavision Europe and their respective Affiliates,
in connection with the Visual Action Acquisition.
"VISUAL ACTION HOLDINGS" means Visual Action Holdings plc, a U.K. public
limited company.
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"VISUAL ACTION HOLDINGS INC." means Visual Action Holdings Inc., a
Delaware corporation.
"VISUAL ACTION NZ" means Visual Action Holdings (N.Z.) Limited, a New
Zealand limited company.
"WARBURG AFFILIATE" shall mean any Subsidiary of any of the entities
listed in clauses (i) through (v), inclusive, of the definition of "Warburg
Pincus" in this Section 1.01.
"WARBURG PINCUS" shall mean, collectively: (i) Warburg, Xxxxxx Capital
Company, L.P., a Delaware limited partnership, (ii) Warburg, Xxxxxx Capital
Partners, L.P., a Delaware limited partnership, (iii) Warburg, Xxxxxx
Investors, L.P., a Delaware limited partnership, (iv) Warburg, Xxxxxx & Co.,
a New York general partnership, and (v) any other venture banking fund in
which Warburg, Xxxxxx & Co. is the general partner.
"WHOLLY OWNED SUBSIDIARY" shall mean, with respect to any Person, any
corporation, partnership or other entity of which all of the equity
securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares and, in the case of Panavision
Canada Holdings, shares and/or options for shares issued (or to be issued) to
its management) are directly or indirectly owned or controlled by such Person
or one or more Wholly Owned Subsidiaries of such Person or by such Person and
one or more Wholly Owned Subsidiaries of such Person (it being understood
that, in the case of Panavision Canada Holdings, the issue of such shares
and/or options contemplated above shall not preclude it from being treated as
a Wholly-Owned Subsidiary of the Borrower for purposes of this Agreement).
"WORKING CAPITAL" shall mean, as at such date, for the Borrower and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) the sum of inventory PLUS accounts
receivable MINUS (b) the sum of accounts payable PLUS accrued expenses at such
date.
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1.02 ACCOUNTING TERMS AND DETERMINATIONS.
(a) Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to
the Lenders hereunder shall (unless otherwise disclosed to the Lenders in
writing at the time of delivery thereof in the manner described in Section
1.02(b) hereof) be prepared, in accordance with generally accepted accounting
principles in the United States applied on a basis consistent with those used
in the preparation of the latest financial statements furnished to the
Lenders hereunder (which, prior to the delivery of the first financial
statements under Section 9.01 hereof, shall mean the audited financial
statements as at December 31, 1996 referred to in Section 8.02 hereof). All
calculations made for the purposes of determining compliance with this
Agreement shall (except as otherwise expressly provided herein) be made by
application of U.S. generally accepted accounting principles applied on a
basis consistent with those used in the preparation of the latest annual or
quarterly financial statements furnished to the Lenders pursuant to Section
9.01 hereof (or, prior to the delivery of the first financial statements
under Section 9.01 hereof, used in the preparation of the audited financial
statements as at December 31, 1996 referred to in Section 8.02 hereof) unless
(i) the Borrower shall have objected to determining such
compliance on such basis at the time of delivery of such financial
statements or
(ii) the Majority Lenders shall so object in writing within 30 days
after delivery of such financial statements,
in either of which events such calculations shall be made on a basis
consistent with those used in the preparation of the latest financial
statements as to which such objection shall not have been made (which, if
objection is made in respect of the first financial statements delivered
under Section 9.01 hereof, shall mean the audited financial statements
referred to in Section 8.02 hereof).
(b) The Borrower shall deliver to the Lenders at the same time as the
delivery of any annual or quarterly financial statement under Section 9.01
hereof (i) a description in reasonable detail of any material variation
between the application of accounting principles employed in the preparation
of such statement and the application of accounting principles employed in
the preparation of the next preceding annual or quarterly financial
statements as to which no objection has been made in accordance with the last
sentence of Section 1.02(a) hereof and (ii) reasonable estimates of the
difference between
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such statements arising as a consequence thereof.
(c) Except as expressly provided herein, all calculations made pursuant
to this Agreement with respect to any period prior to the consummation of the
Visual Action Acquisition (or with respect to any period in which an
Acquisition is consummated) shall be calculated on a pro forma basis as if
the Visual Action Acquisition (or such Acquisition) had been consummated on
the first day of such period and as if any Indebtedness incurred or assumed
in connection with the Visual Action Acquisition (or such Acquisition) were
outstanding throughout such period, using the estimates and pro forma
adjustments set forth in the pro forma financial statements described in
clause (v) of Section 8.02 hereof (or, in the case of an Acquisition, such
reasonable estimates and pro forma adjustments effected in accordance with
U.S. generally accepted accounting principles as the Borrower shall propose
and the Administrative Agent shall approve).
(d) To enable the ready and consistent determination of compliance with
the covenants set forth in Section 9 hereof, the Borrower will not change (i)
the last day of its fiscal year from December 31 of each year, or (ii) the
last days of the first three fiscal quarters in each of its fiscal years from
March 31, June 30 and September 30 of each year, respectively.
1.03 CLASSES, CURRENCIES AND TYPES OF LOANS; SUB-CLASSES OF REVOLVING
CREDIT LOANS. Loans hereunder are distinguished by "Class", by "Currency"
and by "Type". The "Class" of a Loan (or of a Commitment to make a Loan)
refers to whether such Loan is a Revolving Credit Loan, a Tranche A Term Loan
or an Incremental Term Loan, each of which constitutes a Class. The
"Currency" of a Loan refers to the Currency in which such Loan is
denominated. The "Type" of a Loan refers to whether such Loan is a Base Rate
Loan or a Eurocurrency Loan, each of which constitutes a Type. Loans may be
identified by Class, Currency and Type. Revolving Credit Loans hereunder are
also distinguished by "Sub-Class". The "Sub-Class" of a Revolving Credit
Loan refers to whether such Loan is a Dollar Loan or a Sterling Loan.
Section 2. COMMITMENTS, LOANS, EVIDENCE OF DEBT AND PREPAYMENTS.
2.01 LOANS.
(a) REVOLVING CREDIT LOANS.
(i) Each Revolving Credit Lender severally agrees, on the terms
and conditions of this Agreement, to
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make loans to the Borrower in Dollars during the period from and including
the Effective Date to but not including the Revolving Credit Commitment
Termination Date in an aggregate principal amount at any one time outstanding
up to but not exceeding the Available Dollar Commitment of such Lender,
PROVIDED that in no event shall the aggregate principal amount of all Dollar
Loans, together with the aggregate amount of all Letter of Credit
Liabilities, exceed the aggregate Available Dollar Commitments of the
Revolving Credit Lenders at any time. Subject to the terms and conditions of
this Agreement, during such period the Borrower may borrow, repay and
reborrow the amount of the Available Dollar Commitments of the Revolving
Credit Lenders by means of Base Rate Loans and Eurodollar Loans and may
Convert such Dollar Loans of one Type into Dollar Loans of another Type (as
provided in Section 2.09 hereof) or Continue Dollar Loans of one Type as
Dollar Loans of the same Type (as provided in Section 2.09 hereof).
(ii) Each Sterling Lender severally agrees, on the terms and
conditions of this Agreement, to make loans to the Borrower in Pounds
Sterling during the period from and including the Effective Date to but not
including the Revolving Credit Commitment Termination Date in an aggregate
principal amount at any one time outstanding up to but not exceeding the
Sterling Equivalent of the lesser of (a) the amount of the Sterling
Sub-Limit of such Sterling Lender as in effect from time to time and (b) the
unutilized Revolving Credit Commitment of such Sterling Lender (for which
purpose use of the Revolving Credit Commitments shall be deemed to include
the aggregate amount of such Sterling Lender's Revolving Credit Commitment
Percentage of all outstanding Letter of Credit Liabilities), PROVIDED that
in no event shall the aggregate principal amount of Sterling Loans exceed
the aggregate amount of the Sterling Sub-Limits as in effect from time to
time. Subject to the terms and conditions of this Agreement, during such
period the Borrower may borrow, repay and reborrow the amount of the
Sterling Sub-Limits by means of Eurosterling Loans and Continue such
Eurosterling Loans as provided in Section 2.09 hereof.
(iii) Anything herein to the contrary notwithstanding, Revolving
Credit Loans shall not be available hereunder unless the Tranche A Term
Loan Commitments are fully utilized on the Effective Date.
(b) TRANCHE A TERM LOANS. Each Tranche A Term Loan Lender severally
agrees, on the terms and conditions of this Agreement, to make a term loan to
the Borrower in Dollars on the Effective Date in an aggregate principal amount
up to but not
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exceeding the amount of the Tranche A Term Loan Commitment of such Lender.
Thereafter the Borrower may Convert Tranche A Term Loans of one Type into
Tranche A Term Loans of another Type (as provided in Section 2.09 hereof) or
Continue Tranche A Term Loans of one Type as Tranche A Term Loans of the same
Type (as provided in Section 2.09 hereof).
(c) INCREMENTAL TERM LOANS. The Borrower and one or more of the
Lenders may, with the consent of the Administrative Agent, at any one time
during the period from and including the Effective Date to but excluding the
Revolving Credit Commitment Termination Date agree that such Lenders shall
become Incremental Term Loan Lenders by executing and delivering to the
Administrative Agent an Incremental Term Loan Activation Notice specifying
the respective Incremental Term Loan Commitments of the Incremental Term Loan
Lenders, the Incremental Term Loan Activation Date, the Incremental Term Loan
Commitment Termination Date, the rate of commitment fee, if any, payable by
the Borrower in respect of the Incremental Term Loan Commitments, the
Applicable Margin for Incremental Term Loans and, subject to Section 3.01(c)
hereof, the Incremental Term Loan Principal Payment Dates and the amounts of
the installments of principal of the Incremental Term Loans payable thereon,
and otherwise duly completed. Each Incremental Term Loan Lender severally
agrees, on the terms and conditions of this Agreement, to make one or more
term loans to the Borrower in Dollars during the period from and including
the Incremental Term Loan Activation Date to but excluding the Incremental
Term Loan Commitment Termination Date in an aggregate principal amount up to
but not exceeding the amount of the Incremental Term Loan Commitment of such
Incremental Term Loan Lender as in effect from time to time. Thereafter,
subject to the terms and conditions of this Agreement, the Borrower may
Convert Incremental Term Loans of one Type into Incremental Term Loans of
another Type (as provided in Section 2.09 hereof) or Continue Incremental
Term Loans of one Type as Incremental Term Loans of the same Type (as
provided in Section 2.09 hereof).
(d) LIMIT ON EUROCURRENCY LOANS. No more than ten separate Interest
Periods in respect of Eurocurrency Loans of all Classes from each Lender may
be outstanding at any one time.
(e) CURRENCY EQUIVALENTS. Except as provided in Section 2.10(h), for
purposes of determining (i) whether the amount of any borrowing of a Sterling
Loan from a Sterling Lender would exceed such Sterling Lender's Sterling
Sub-Limit or Revolving Credit Commitment, (ii) whether the amount of any
borrowing of Sterling Loans would exceed the aggregate Sterling Sub-Limits,
(iii) whether the amount of any borrowing of a Dollar Loan from a Revolving
Credit Lender would exceed such Revolving Credit Lender's Available Dollar
Commitment or (iv) whether the
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issuance of any Letter of Credit would exceed the Available Dollar
Commitments, the outstanding principal amount of any Sterling Loan shall be
deemed to be the Dollar Equivalent (determined as of the date of borrowing of
such Loan or the issuance of any Letter of Credit) of the amount in Pounds
Sterling of such Loan.
2.02 BORROWINGS. The Borrower shall give the Administrative Agent
notice of each borrowing hereunder as provided in Section 4.05 hereof. Not
later than 1:00 p.m. New York time (or, if with respect to a borrowing of
Sterling Loans, 1:00 p.m. London time) on the date specified for each
borrowing hereunder, each Lender shall make available the amount of the Loan
or Loans to be made by it on such date to the Administrative Agent, at an
account in New York, New York (or, if with respect to a borrowing of Sterling
Loans, London, England) specified by the Administrative Agent, in immediately
available funds, for account of the Borrower. The amount so received by the
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Borrower by depositing the same, in
immediately available funds, in an account of the Borrower designated by the
Borrower and maintained with Chase at its principal office in New York, New
York (or, in the case of Sterling Loans, in an account of the Borrower
designated by the Borrower).
2.03 LETTERS OF CREDIT. Subject to the terms and conditions of this
Agreement, the Available Dollar Commitments of the Revolving Credit Lenders
may be utilized, upon the request of the Borrower, in addition to the Dollar
Loans provided for by Section 2.01(a) hereof, by the issuance by the Issuing
Lender of letters of credit (collectively, "LETTERS OF CREDIT") for account
of the Borrower or any of its Subsidiaries (as specified by the Borrower),
PROVIDED that in no event shall (i) the aggregate amount of all Letter of
Credit Liabilities, together with the aggregate principal amount of Dollar
Loans, exceed the aggregate amount of the Available Dollar Commitments from
time to time, (ii) the outstanding aggregate amount of all Letter of Credit
Liabilities exceed the Letter of Credit Limit and (iii) the expiration date
(without giving effect to any extension thereof by reason of an interruption
of business) of any Letter of Credit extend beyond the earlier of the
Revolving Credit Commitment Termination Date and the date eighteen months
following the issuance of such Letter of Credit (PROVIDED that any such
Letter of Credit may provide for automatic extensions thereof to a date not
later than twelve months beyond the current expiration date, so long as such
extended expiration date is not later than eighteen months after the date
upon which such automatic extension may no longer be canceled). The
following additional provisions shall apply to Letters of Credit:
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(a) The Borrower shall give the Administrative Agent at least three
Business Days' irrevocable prior notice (effective upon receipt) specifying
the Business Day (which shall be no later than 30 days preceding the
Revolving Credit Commitment Termination Date) each Letter of Credit is to be
issued and the account party or parties therefor and describing in reasonable
detail the proposed terms of such Letter of Credit (including the beneficiary
thereof) and the nature of the transactions or obligations proposed to be
supported thereby (including whether such Letter of Credit is to be a
commercial letter of credit or a standby letter of credit). Upon receipt of
any such notice, the Administrative Agent shall advise each Lender of the
contents thereof.
(b) On each day during the period commencing with the issuance by the
Issuing Lender of any Letter of Credit and until such Letter of Credit shall
have expired or been terminated, the Revolving Credit Commitment of each
Revolving Credit Lender shall be deemed to be utilized for all purposes of
this Agreement in an amount equal to such Lender's Revolving Credit
Commitment Percentage of the then undrawn face amount of such Letter of
Credit. Each Revolving Credit Lender (other than the Issuing Lender) agrees
that, upon the issuance of any Letter of Credit hereunder, it shall
automatically acquire a participation in the Issuing Lender's liability under
such Letter of Credit in an amount equal to such Lender's Revolving Credit
Commitment Percentage of such liability, and each Revolving Credit Lender
(other than the Issuing Lender) thereby shall absolutely, unconditionally and
irrevocably assume, as primary obligor and not as surety, and shall be
unconditionally obligated to the Issuing Lender to pay and discharge when
due, its Revolving Credit Commitment Percentage of the Issuing Lender's
liability under such Letter of Credit.
(c) Upon receipt from the beneficiary of any Letter of Credit of any
demand for payment under such Letter of Credit, the Issuing Lender shall
promptly notify the Borrower (through the Administrative Agent) of the amount
to be paid by the Issuing Lender as a result of such demand and the date on
which payment is to be made by the Issuing Lender to such beneficiary in
respect of such demand. Notwithstanding the identity of the account party of
any Letter of Credit, the Borrower hereby unconditionally agrees to pay and
reimburse the Administrative Agent for account of the Issuing Lender for the
amount of each demand for payment under such Letter of Credit that is in
substantial compliance with the provisions of such Letter of Credit at or
prior to the date on which payment is to be made by the
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Issuing Lender to the beneficiary thereunder, without presentment, demand,
protest or other formalities of any kind.
(d) Forthwith upon its receipt of a notice referred to in paragraph (c)
of this Section 2.03, the Borrower shall advise the Administrative Agent
whether or not the Borrower intends to borrow hereunder to finance its
obligation to reimburse the Issuing Lender for the amount of the related
demand for payment, PROVIDED that, unless the Borrower shall otherwise notify
the Administrative Agent within one Business Day of its receipt of such
notice, the Borrower shall be deemed to have requested a borrowing hereunder
in the lowest amount permitted under Section 4.04 which would enable the
Borrower to fulfill its payment obligation in respect of such demand for
payment. The proceeds of such borrowing will be applied automatically to the
payment of the Reimbursement Obligation arising in respect of such demand for
payment, with any remaining portion of such borrowing in excess of the amount
of such Reimbursement Obligation being made available to the Borrower as
provided in Section 2.02 hereof.
(e) Each Revolving Credit Lender (other than the Issuing Lender) shall
pay to the Administrative Agent for account of the Issuing Lender at its
principal office in New York, New York in Dollars and in immediately
available funds, the amount of such Lender's Revolving Credit Commitment
Percentage of any payment under a Letter of Credit upon notice by the Issuing
Lender (through the Administrative Agent) to such Revolving Credit Lender
requesting such payment and specifying such amount. Each such Revolving
Credit Lender's obligation to make such payment to the Administrative Agent
for account of the Issuing Lender under this paragraph (e), and the Issuing
Lender's right to receive the same, shall be absolute and unconditional and
shall not be affected by any circumstance whatsoever, including, without
limitation, the failure of any other Revolving Credit Lender to make its
payment under this paragraph (e), the financial condition of the Borrower (or
any other account party), the existence of any Default or the termination of
the Commitments. Each such payment to the Issuing Lender shall be made
without any offset, abatement, withholding or reduction whatsoever. If any
Revolving Credit Lender shall default in its obligation to make any such
payment to the Administrative Agent for account of the Issuing Lender, for so
long as such default shall continue the Administrative Agent may at the
request of the Issuing Lender withhold from any payments received by the
Administrative Agent under this Agreement for account of such Revolving
Credit Lender the amount so in default and,
CREDIT AGREEMENT
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to the extent so withheld, pay the same to the Issuing Lender in satisfaction
of such defaulted obligation.
(f) Upon the making of each payment by a Revolving Credit Lender to the
Issuing Lender pursuant to paragraph (e) above in respect of any Letter of
Credit, such Lender shall, automatically and without any further action on
the part of the Administrative Agent, the Issuing Lender or such Lender,
acquire (i) a participation in an amount equal to such payment in the
Reimbursement Obligation owing to the Issuing Lender by the Borrower
hereunder and under the Letter of Credit Documents relating to such Letter of
Credit and (ii) a participation in a percentage equal to such Lender's
Revolving Credit Commitment Percentage in any interest or other amounts
payable by the Borrower hereunder and under such Letter of Credit Documents
in respect of such Reimbursement Obligation (other than the commissions,
charges, costs and expenses payable to the Issuing Lender pursuant to
paragraph (g) of this Section 2.03). Upon receipt by the Issuing Lender from
or for account of the Borrower of any payment in respect of any Reimbursement
Obligation or any such interest or other amount (including by way of setoff
or application of proceeds of any collateral security) the Issuing Lender
shall promptly pay to the Administrative Agent for account of each Revolving
Credit Lender entitled thereto, such Revolving Credit Lender's Revolving
Credit Commitment Percentage of such payment, each such payment by the
Issuing Lender to be made in the same money and funds in which received by
the Issuing Lender. In the event any payment received by the Issuing Lender
and so paid to the Revolving Credit Lenders hereunder is rescinded or must
otherwise be returned by the Issuing Lender, each Revolving Credit Lender
shall, upon the request of the Issuing Lender (through the Administrative
Agent), repay to the Issuing Lender (through the Administrative Agent) the
amount of such payment paid to such Lender, with interest at the rate
specified in paragraph (j) of this Section 2.03.
(g) The Borrower shall pay to the Administrative Agent for account of
each Revolving Credit Lender (ratably in accordance with their respective
Revolving Credit Commitment Percentages) a letter of credit fee in respect of
each Letter of Credit at a rate per annum equal to the Applicable Margin for
Revolving Credit Loans that are Eurocurrency Loans MINUS 1/4 of 1%, in
respect of the daily average undrawn face amount of such Letter of Credit for
the period from and including the date of issuance of such Letter of Credit
(i) in the case of a Letter of Credit that expires in accordance with its
terms, to and including such expiration date and (ii) in the case of a Letter
of Credit that is drawn in full or is otherwise terminated other than on the
stated expiration date of such Letter of Credit, to but excluding the date
such Letter of Credit is drawn in full or is terminated (such fee to be
non-refundable, to be paid in arrears on each Quarterly Date and on the
Revolving Credit Commitment Termination Date and to be calculated for any day
after giving effect to any payments made under such Letter of Credit on such
day). In addition, the Borrower shall pay to the Administrative Agent for
account of the Issuing Lender a fronting fee in respect of each Letter of
Credit in an amount equal to 1/4 of 1% per annum of the daily average undrawn
face amount of such Letter of Credit for the period from and including the
date of issuance of such Letter of Credit (i) in the case of a Letter of
Credit that expires in accordance with its terms, to and including such
expiration date and (ii) in the case of a Letter of Credit that is
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drawn in full or is otherwise terminated other than on the stated expiration
date of such Letter of Credit, to but excluding the date such Letter of
Credit is drawn in full or is terminated (such fee to be non-refundable, to
be paid in arrears on each Quarterly Date and on the Revolving Credit
Commitment Termination Date and to be calculated for any day after giving
effect to any payments made under such Letter of Credit on such day) plus all
commissions, charges, costs and expenses in the amounts customarily charged
by the Issuing Lender from time to time in like circumstances with respect to
the issuance of, or amendments to, each Letter of Credit and drawings and
other transactions relating thereto.
(h) Upon the request of any Revolving Credit Lender from time to time,
the Issuing Lender shall deliver any other information reasonably requested
by such Lender with respect to each Letter of Credit then outstanding.
(i) The issuance by the Issuing Lender of each Letter of Credit shall,
in addition to the conditions precedent set forth in Section 7 hereof, be
subject to the conditions precedent that (i) such Letter of Credit shall be
in such form, contain such terms and support such transactions as shall be
satisfactory to the Issuing Lender consistent with its then current practices
and procedures with respect to letters of credit of the same type and (ii)
the Borrower shall have executed and delivered such applications, agreements
and other instruments relating to such Letter of Credit as the Issuing Lender
shall have reasonably requested consistent with its then current practices
and procedures with respect to letters of credit of the same type, PROVIDED
that such application, agreement or other instrument shall not impose any
financial obligation on the Borrower or any of its Subsidiaries inconsistent
with this Agreement and in the event of any conflict between any such
application,
CREDIT AGREEMENT
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agreement or other instrument and the provisions of this Agreement or any
Security Document, the provisions of this Agreement and the Security
Documents shall control.
(j) To the extent that any Lender shall fail to pay any amount
required to be paid pursuant to paragraph (e) or (f) of this Section 2.03
on the due date therefor, such Lender shall pay interest to the Issuing
Lender (through the Administrative Agent) on such amount from and including
such due date to but excluding the date such payment is made at a rate per
annum equal to the Federal Funds Rate, PROVIDED that if such Lender shall
fail to make such payment to the Issuing Lender within three Business Days
of such due date, then, retroactively to the due date, such Lender shall be
obligated to pay interest on such amount at the Post-Default Rate.
(k) The issuance by the Issuing Lender of any modification or
supplement to any Letter of Credit hereunder shall be subject to the same
conditions applicable under this Section 2.03 to the issuance of new
Letters of Credit, and no such modification or supplement shall be issued
hereunder unless either (i) the respective Letter of Credit affected
thereby would have complied with such conditions had it originally been
issued hereunder in such modified or supplemented form or (ii) each
Revolving Credit Lender shall have consented thereto.
The Borrower hereby indemnifies and holds harmless each Revolving Credit
Lender and the Administrative Agent from and against any and all claims and
damages, losses, liabilities, costs or expenses that such Lender or the
Administrative Agent may incur (or that may be claimed against such Lender or
the Administrative Agent by any Person whatsoever) by reason of or in
connection with the execution and delivery or transfer of or payment or
refusal to pay by the Issuing Lender under any Letter of Credit; PROVIDED
that the Borrower shall not be required to indemnify any Lender or the
Administrative Agent for any claims, damages, losses, liabilities, costs or
expenses to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of the Issuing Lender in determining whether a
request presented under any Letter of Credit complied with the terms of such
Letter of Credit or (y) in the case of the Issuing Lender, such Lender's
failure to pay under any Letter of Credit after the presentation to it of a
request strictly complying with the terms and conditions of such Letter of
Credit. Nothing in this Section 2.03 is intended to limit the other
obligations of the Borrower, any Lender or the Administrative Agent under
this Agreement.
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2.04 CHANGES OF COMMITMENTS.
(a) The aggregate amount of the Revolving Credit Commitments shall be
automatically reduced to zero on the Revolving Credit Commitment Termination
Date. In addition, the aggregate amount of the Revolving Credit Commitments
shall be automatically reduced on each Revolving Credit Commitment Reduction
Date set forth in column (A) below to the amount (subject to reduction
pursuant to paragraph (c) below) set forth in column (B) below opposite such
Revolving Credit Commitment Reduction Date:
(A) (B)
Revolving Credit Revolving Credit
Commitment Reduction Commitments Reduced
Date Falling on or to the Following
Nearest To: Amounts
----------- --------------------
March 31, 1999 $87,750,000
June 30, 1999 85,500,000
September 30, 1999 83,250,000
December 31, 1999 81,000,000
March 31, 2000 78,500,000
June 30, 2000 76,000,000
September 30, 2000 73,500,000
December 31, 2000 71,000,000
March 31, 2001 68,500,000
June 30, 2001 66,000,000
September 30, 2001 63,500,000
December 31, 2001 61,000,000
March 31, 2002 55,937,500
June 30, 2002 50,875,000
September 30, 2002 45,812,500
December 31, 2002 40,750,000
March 31, 2003 35,687,500
June 30, 2003 30,625,000
September 30, 2003 25,562,500
December 31, 2003 20,500,000
March 31, 2004 10,250,000
June 30, 2004 0
(b) The Borrower shall have the right at any time or from time to time
(i) so long as no Revolving Credit Loans or Letter of Credit Liabilities are
outstanding, to terminate the Revolving Credit Commitments, (ii) to reduce
the aggregate
CREDIT AGREEMENT
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unutilized amount of the Revolving Credit Commitments , (iii) to reduce the
aggregate unutilized amount of the Sterling Sub-Limits and (iv) to terminate
the Term Loan Commitments; PROVIDED that (x) the Borrower shall give notice
of each such termination or reduction as provided in Section 4.05 hereof and
(y) each partial reduction of either the Revolving Credit Commitments or the
Term Loan Commitments shall be in an aggregate amount at least equal to
$5,000,000 (or a larger multiple of $1,000,000). In addition, the Revolving
Credit Commitments (including the Sterling Sub-Limits) shall be automatically
reduced to the extent required pursuant to Section 2.10(f) hereof.
(c) Each partial reduction in the aggregate amount of the Revolving
Credit Commitments pursuant to paragraph (b)(ii) above, or Section 2.10(f)
hereof, on any date shall be applied to scheduled reductions in the Revolving
Credit Commitments ratably as follows: each such reduction shall result in
an automatic and simultaneous reduction (but not below zero) of the aggregate
amount of Revolving Credit Commitments set forth in column (B) in paragraph
(a) above (ratably in accordance with the respective remaining amounts
thereof, after giving effect to any prior reductions pursuant to this
paragraph (c)).
(d) Each reduction in the aggregate amount of the Revolving Credit
Commitments shall result in an automatic and simultaneous ratable reduction
(but not below zero) of the aggregate amount of the Sterling Sub-Limits.
(e) Any portion of the Tranche A Term Loan Commitments not used on the
Effective Date shall be automatically terminated on the Effective Date. Any
portion of the Incremental Term Loan Commitments not used on the Incremental
Term Loan Commitment Termination Date shall be automatically terminated on
the Incremental Term Loan Commitment Termination Date.
(f) The Commitments once terminated or reduced may not be reinstated.
CREDIT AGREEMENT
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2.05 COMMITMENT FEE.
(a) The Borrower shall pay to the Administrative Agent for account of
each Revolving Credit Lender commitment fee on the daily average unutilized
amount of such Lender's Revolving Credit Commitment (for which purpose (x)
the aggregate amount of any Letter of Credit Liabilities shall be deemed to
be a pro rata (based on the Revolving Credit Commitments) use of each
Lender's Revolving Credit Commitment and (y) the outstanding principal amount
of any Sterling Loan shall be deemed to be the Dollar Equivalent of such
Sterling Loan on the most recent date such amount was determined pursuant to
Section 2.10(h)(i)), for the period from and including the Effective Date to
but not including the earlier of the date such Revolving Credit Commitment is
terminated and the Revolving Credit Commitment Termination Date, at the
Applicable Fee Rate during each Accrual Period.
(b) The Borrower shall pay to the Administrative Agent for account of
each Incremental Term Loan Lender commitment fee, if any, on the daily
average unutilized amount of such Incremental Term Loan Lender's Incremental
Term Loan Commitment, for the period from and including the Incremental Term
Loan Activation Date to but not including the earlier of the date such
Incremental Term Loan Commitment is terminated and the Incremental Term Loan
Commitment Termination Date, at a rate per annum agreed to by the Borrower
and the Incremental Term Loan Lenders and specified in the Incremental Term
Loan Activation Notice.
(c) Accrued commitment fee shall be payable on each Quarterly Date and
on the earlier of the date the relevant Commitments are terminated and the
Revolving Credit Commitment Termination Date or the Incremental Term Loan
Commitment Termination Date, as the case may be.
2.06 LENDING OFFICES. The Loans of each Type made by each Lender shall
be made and maintained at such Lender's Applicable Lending Office for Loans
of such Type.
2.07 SEVERAL OBLIGATIONS; REMEDIES INDEPENDENT. The failure of any
Lender to make any Loan to be made by it on the date specified therefor shall
not relieve any other Lender of its obligation to make its Loan on such date,
but neither any Lender nor the Administrative Agent shall be responsible for
the failure of any other Lender to make a Loan to be made by such other
Lender, and (except as otherwise provided in Section 4.06 hereof) no Lender
shall have any obligation to the Administrative Agent or any other Lender for
the failure by such Lender to make any Loan required to be made by such
Lender.
CREDIT AGREEMENT
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2.08 EVIDENCE OF DEBT.
(a) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(b) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Class, Sub-Class (if
such Loan is a Revolving Credit Loan) and Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due
and payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender's share
thereof.
(c) The entries made in the accounts maintained pursuant to paragraph
(a) or (b) of this Section shall be PRIMA FACIE evidence of the existence and
amounts of the obligations recorded therein; PROVIDED that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to
repay the Loans in accordance with the terms of this Agreement.
(d) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns)
in a form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 12.06) be represented by one
or more promissory notes in such form (payable to the order of each Lender
holding a portion of such Loans, or, if such promissory note is a registered
note, to such Lender and its registered assigns).
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2.09 OPTIONAL PREPAYMENTS AND CONVERSIONS OR CONTINUATIONS OF LOANS.
Subject to Section 4.04 hereof, the Borrower shall have the right to prepay
Loans, to Convert Dollar Loans and Term Loans of one Type into Loans of
another Type or to Continue Eurocurrency Loans from one Interest Period to
another Interest Period, at any time or from time to time, PROVIDED that:
(a) the Borrower shall give the Administrative Agent notice of each such
prepayment, Conversion or Continuation as provided in Section 4.05 hereof
(and, upon the date specified in any such notice of prepayment, the amount to
be prepaid shall become due and payable hereunder); (b) upon any prepayment
or Conversion of Eurocurrency Loans other than on the last day of an Interest
Period for such Loans, the Borrower shall pay any amounts owing under Section
5.05 hereof as a result of such prepayment or Conversion; (c) any Conversion
into or Continuation of Eurocurrency Loans shall be subject to the provisions
of Section 2.01(d) hereof; and (d) prepayments of the Term Loans shall be
applied pro rata to the then remaining principal installments thereof.
Notwithstanding the foregoing, and without limiting the rights and remedies
of the Lenders under Section 10 hereof, in the event that any Event of
Default shall have occurred and be continuing, the Administrative Agent may
(and at the request of the Majority Lenders shall) suspend the right of the
Borrower to Convert any Loan into a Eurodollar Loan, or to Continue any Loan
as a Eurocurrency Loan, in which event (x) all Eurodollar Loans shall be
Converted (on the last day(s) of the respective Interest Periods therefor)
into, or Continued as, as the case may be, Base Rate Loans and (y) each
Sterling Loans shall be deemed repaid (on the last day of the Interest Period
therefor) and automatically reborrowed as a Base Rate Loan in an aggregate
principal amount equal to the Dollar Equivalent of such Sterling Loan on the
last day of the Interest Period therefor.
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2.10 MANDATORY PREPAYMENTS AND REDUCTIONS OF COMMITMENTS.
(a) CASUALTY EVENTS. Upon the date 90 days following the receipt by the
Borrower or any of its Subsidiaries of the proceeds of insurance,
condemnation award or other compensation in respect of any Casualty Event
affecting any Property of the Borrower or any of its Subsidiaries (or upon
such earlier date as the Borrower or such Subsidiary, as the case may be,
shall have determined not to repair or replace the Property affected by such
Casualty Event), the Borrower shall prepay the Loans (and/or provide cover
for Letter of Credit Liabilities as specified in paragraph (g) below), and
the Commitments shall be subject to automatic reduction, in an aggregate
amount, if any, equal to 100% of the Net Available Proceeds of such Casualty
Event not theretofore applied (or committed to be applied pursuant to
executed construction contracts or equipment orders) to the repair or
replacement of such Property or to the purchase of other Property used or
useful in the business of the Borrower and its Subsidiaries, such prepayment
and reduction to be effected in each case in the manner and to the extent
specified in paragraph (f) below, PROVIDED that, notwithstanding the
foregoing, the Borrower shall not be required to make any prepayment or
reduce the Commitments under this paragraph (a) until such time as the
aggregate amount of the required prepayments and reductions of Commitments
hereunder, after deducting any such amounts previously applied to prepayments
and reductions pursuant to this paragraph (a), shall be greater than or equal
to $1,000,000. Nothing in this paragraph (a) shall be deemed to limit any
obligation of the Borrower and its Subsidiaries pursuant to the Security
Agreement to remit to the Collateral Account the proceeds of insurance,
condemnation award or other compensation received in respect of any Casualty
Event, and the Administrative Agent shall release such proceeds to the
Borrower in the manner, and to the extent, provided in Section 4.01(d) of the
Security Agreement.
(b) EQUITY ISSUANCE. Upon any Equity Issuance after the Effective Date
(other than an Equity Issuance in connection with the exercise of stock
options held by any of the Management Group) at a time when the Total Debt
Ratio is greater than or equal to 1.25 to 1, the Borrower shall prepay the
Loans (and/or provide cover for Letter of Credit Liabilities as specified in
paragraph (g) below), and the Commitments shall be subject to automatic
reduction, in an aggregate amount equal to the lesser of (i) 50% of the Net
Available Proceeds of such Equity Issuance or (ii) the amount of such Net
Available Proceeds that, when applied to the prepayment of Loans as
contemplated by this Section 2.10, will result in the Total Debt Ratio being
less than 1.25 to 1, such prepayment and reduction to be effected in each
CREDIT AGREEMENT
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case in the manner and to the extent specified in paragraph (f) below.
(c) EXCESS CASH FLOW. Not later than the date 90 days after the end of
each fiscal year of the Borrower, the Borrower shall prepay the Term Loans in
an aggregate amount equal to 50% of Excess Cash Flow for such fiscal year,
such prepayment and reduction to be effected in each case in the manner and
to the extent specified in paragraph (f) below.
(d) SALE OF ASSETS. Without limiting the obligation of the Borrower to
obtain the consent of the Majority Lenders pursuant to Section 9.05 hereof to
any Disposition not otherwise permitted hereunder, the Borrower agrees, on or
prior to the occurrence of any Disposition (other than an Excluded
Disposition) in which the Net Available Proceeds of such Disposition shall
exceed $250,000 (herein, the "CURRENT DISPOSITION"), to deliver to the
Administrative Agent (which shall promptly forward a copy thereof to the
Lenders) a statement, certified by a Senior Officer, in form and detail
reasonably satisfactory to the Administrative Agent, of the estimated amount
of the Net Available Proceeds of the Current Disposition that will (on the
date of the Current Disposition) be received in cash, in which event the
Borrower will prepay the Loans (and/or provide cover for Letter of Credit
Liabilities as specified in paragraph (g) below), and the Commitments shall
be subject to automatic reduction (in each case in the manner specified in
paragraph (f) below as follows:
(i) upon the date of the Current Disposition, in an aggregate amount
equal to 100% of the Net Available Proceeds thereof to the extent received in
cash on the date of the Current Disposition; and
(ii) thereafter, from time to time as the Borrower or any of its
Subsidiaries shall receive Net Available Proceeds during such quarterly
fiscal period in cash under deferred payment or escrow arrangements or
Investments entered into or received in connection with any Disposition, in
an amount equal to (x) 100% of the aggregate amount of such Net Available
Proceeds MINUS (y) any transaction expenses associated with Dispositions and
not previously deducted in the determination of Net Available Proceeds PLUS
(or MINUS, as the case may be) (z) any other adjustment received or paid by
the Borrower or such Subsidiary pursuant to the respective agreements giving
rise to Dispositions and not previously taken into account in the
determination of the Net Available Proceeds of Dispositions,
PROVIDED that, notwithstanding the foregoing, the Borrower shall not be
required to make any prepayment or reduce Commitments
CREDIT AGREEMENT
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under this paragraph (d) until such time as the aggregate amount of the
required prepayments and reductions of Commitments pursuant to the foregoing
clauses (i) and (ii) (with respect to the then Current Disposition and all
prior Dispositions as to which a prepayment has not yet been made under this
paragraph (d)), after deducting any such amounts previously applied to
prepayments and reductions of Commitments pursuant to this paragraph (d),
shall be greater than or equal to $1,000,000.
(e) DEBT ISSUANCE. Upon any issuance or incurrence of Indebtedness
after the Effective Date (other than Indebtedness permitted under Sections
9.07(a), (b), (d) and (e) hereof), (i) at any time when the Total Debt Ratio
is greater than or equal to 1.25 to 1, in respect of Subordinated
Indebtedness permitted under Section 9.11(a) hereof or (ii) in respect of any
other Indebtedness (other than the Loans), the Borrower shall prepay the
Loans (and/or provide cover for Letter of Credit Liabilities as specified in
paragraph (g) below), and the Commitments shall be subject to automatic
reduction, in an aggregate amount equal to 100% of the Net Available Proceeds
thereof (or, with respect to any Subordinated Indebtedness referred to in
clause (i) above, the amount of such Net Available Proceeds that, when
applied to the prepayment of Loans as contemplated by this Section 2.10, will
result in the Total Debt Ratio being less than 1.25 to 1, whichever amount is
lesser), such prepayment to be effected in each case in the manner and to the
extent specified in paragraph (f) below;
(f) APPLICATION. Prepayments and reductions of Commitments described in
the above paragraphs of this Section 2.10 shall be applied without penalty or
premium (except for any interest rate breakage costs pursuant to Section 5.05
hereof), first, to repay Term Loans, ratably as between the outstanding
Tranche A Term Loans and the outstanding Incremental Term Loans (if any) and
ratably to the then remaining respective principal installments thereof and,
thereafter, except for prepayments described in paragraph (c) above, to
reduce permanently the aggregate amount of Revolving Credit Commitments (and,
if after such reduction the aggregate principal amount of Revolving Credit
Loans, together with the aggregate amount of Letter of Credit Liabilities,
exceed the aggregate amount of such Revolving Credit Commitments, to prepay
Revolving Credit Loans and/or provide cover for outstanding letters of credit
as provided in paragraph (g) below). Notwithstanding the foregoing, the
amount required to be applied in respect of the Term Loans under paragraph
(c) above shall be applied in respect of such Term Loans as follows: first,
25% of such amount shall be applied ratably as between the outstanding
Tranche A Term Loans and the outstanding Incremental Term Loans and in direct
order of the then remaining principal installments thereof scheduled to fall
due during the period of 12 months immediately succeeding
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the date of such application; and, then, the remainder shall be applied as
provided above in this paragraph (f).
(g) COVER FOR LETTER OF CREDIT LIABILITIES. In the event that the
Borrower shall be required pursuant to this Section 2.10, or pursuant to
Section 3.01(a) hereof, to provide cover for Letter of Credit Liabilities,
the Borrower shall effect the same by paying to the Administrative Agent
immediately available funds in an amount equal to the required amount, which
funds shall be retained by the Administrative Agent in the Collateral Account
(as provided therein as collateral security in the first instance for the
Letter of Credit Liabilities) until such time as the Letters of Credit shall
have been terminated and all of the Letter of Credit Liabilities have been
paid in full.
(h) CURRENCY VALUATION.
(i) On each Quarterly Date and upon the receipt by the Administrative
Agent of a Currency Valuation Notice (as defined below), but in any event
no more than once in any rolling 30-day period, the Administrative Agent
shall promptly determine the aggregate outstanding principal amount of all
Sterling Loans and the aggregate outstanding principal amount of all
Revolving Credit Loans (for which purpose the outstanding principal amount
of any Sterling Loan shall be deemed to be the Dollar Equivalent
(determined as of the Business Day on which the Administrative Agent shall
have received such Currency Valuation Notice prior to 11:00 a.m. New York
time (or, if received by the Administrative Agent after such time on any
Business Day, as of the next succeeding Business Day) or as of such
Quarterly Date) of the amount in Pounds Sterling of such Loan). Upon
making such determination, the Administrative Agent shall promptly
notify the Revolving Credit Lenders and the Borrower thereof.
(ii) If, on the date of such determination, (A) the aggregate
outstanding principal amount of all Sterling Loans exceeds 105% of the
aggregate amount of the Sterling Sub-Limits as then in effect or (B) the
aggregate outstanding principal amount of all Revolving Credit Loans exceeds
the aggregate amount of the Revolving Credit Commitments as then in effect,
the Borrower shall, if requested (through the Administrative Agent) by any
Sterling Lender or Revolving Credit Lender, as the case may be, prepay the
Sterling Loans or the Revolving Credit Loans in an amount such that after
giving effect thereto the aggregate outstanding principal amount of the
Sterling Loans does not exceed the aggregate amount of the Sterling
Sub-Limits or the aggregate outstanding principal amount of the Revolving
Credit Loans does not exceed the aggregate
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Revolving Credit Commitments, as the case may be. Any such payment pursuant
to the foregoing clauses (A) and (B) shall be accompanied by any amounts
payable under Sections 3.02 and 5.05 hereof.
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Revolving Credit Commitments, as the case may be. Any such payment
pursuant to the foregoing clauses (A0 and (B) shall be accompanied by any
amounts payable under Sections 3.02 and 5.05 hereof.
For purposes of this Section 2.10(h), "CURRENCY VALUATION NOTICE" shall mean
a notice given by any Sterling Lender or Revolving Credit Lender to the
Administrative Agent stating that such notice is a "Currency Valuation
Notice" and requesting that the Administrative Agent determine the aggregate
outstanding principal amount of Sterling Loans or the Revolving Credit Loans,
as the case may be.
Section 3. PAYMENTS OF PRINCIPAL AND INTEREST.
3.01 REPAYMENT OF LOANS.
(a) REVOLVING CREDIT LOANS. The Borrower hereby promises to pay to
the Administrative Agent for account of each Lender the entire outstanding
principal amount of such Lender's Revolving Credit Loans, and each Revolving
Credit Loan shall mature, on the Revolving Credit Commitment Termination Date.
(b) TRANCHE A TERM LOANS. The Borrower hereby promises to pay to
the Administrative Agent for account of the Tranche A Term Loan Lenders the
principal of the Tranche A Term Loans in twenty-six installments payable on
the Tranche A Principal Payment Dates as follows:
Tranche A
Principal Payment Date
Falling on or Nearest to: Amount of Installment ($)
-------------------------- -------------------------
March 31, 1998 1,250,000
June 30, 1998 1,250,000
September 30, 1998 1,250,000
December 31, 1998 1,250,000
March 31, 1999 2,500,000
June 30, 1999 2,500,000
September 30, 1999 2,500,000
December 31, 1999 2,500,000
March 31, 2000 2,500,000
June 30, 2000 2,500,000
September 30, 2000 2,500,000
December 31, 2000 2,500,000
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March 31, 2001 2,500,000
June 30, 2001 2,500,000
September 30, 2001 2,500,000
December 31, 2001 2,500,000
March 31, 2002 2,500,000
June 30, 2002 2,500,000
September 30, 2002 2,500,000
December 31, 2002 2,500,000
March 31, 2003 2,500,000
June 30, 2003 2,500,000
September 30, 2003 2,500,000
December 31, 2003 2,500,000
March 31, 2004 2,500,000
June 30, 2004 2,500,000
If the Borrower does not borrow the full amount of the aggregate Tranche A
Term Loan Commitments on the Effective Date, the shortfall shall be applied
to reduce the foregoing installments ratably.
(c) INCREMENTAL TERM LOANS. The Borrower hereby promises to pay to
the Administrative Agent for account of the Incremental Term Loan Lenders the
principal of the Incremental Term Loans on the Incremental Term Loan
Principal Payment Dates in the installments specified in the Incremental Term
Loan Activation Notice. Notwithstanding the foregoing, the scheduled
installments set forth in the Incremental Term Loan Activation Notice shall
not require the Borrower (i) to repay any principal of the Incremental Term
Loans prior to Xxxxx 00, 0000, (xx) to repay more than 2.5% of the original
principal amount of the Incremental Term Loans on any Quarterly Date in
calendar year 1999, (iii) to repay more than 5% of the original principal
amount of the Incremental Term Loans on any Quarterly Date in calendar years
2000, 2001, 2002, 2003 or on March 31, 2004, June 30, 2004 or September 30,
2004. Scheduled installments of principal of the Incremental Term Loans on
and after December 31, 2004 shall be as the Borrower and the Incremental Term
Loan Lenders agree in the Incremental Term Loan Activation Notice.
3.02 INTEREST. The Borrower hereby promises to pay to the
Administrative Agent for account of each Lender interest on the unpaid
principal amount of each Loan made by such Lender for the period from and
including the date of such Loan to but excluding the date such Loan shall be
paid in full, at the following rates per annum:
(a) during such periods as such Loan is a Base Rate Loan, the Base
Rate (as in effect from time to time) PLUS
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the Applicable Margin; and
(b) during each Interest Period for such Loan during which such
Loan is a Eurocurrency Loan, the Eurocurrency Rate for such Interest Period
PLUS the Applicable Margin.
Notwithstanding the foregoing, the Borrower hereby promises to pay to the
Administrative Agent for account of each Lender interest on all of the Loans
or Reimbursement Obligations hereunder at the applicable Post-Default Rate on
any principal of any Loan made by such Lender and on any other amount payable
by the Borrower hereunder to or for account of such Lender, that shall not be
paid in full when due (whether at stated maturity, by acceleration, by
mandatory prepayment or otherwise), for the period from and including the due
date thereof to but excluding the date the same is paid in full. Accrued
interest on each Loan shall be payable (i) in the case of a Base Rate Loan,
quarterly on the Quarterly Dates, (ii) in the case of a Eurocurrency Loan, on
the last day of each Interest Period therefor and, if such Interest Period is
longer than three months, at three-month intervals following the first day of
such Interest Period, and (iii) in the case of any Loan, upon the payment or
prepayment thereof or the Conversion of such Loan to a Loan of another Type
(but only on the principal amount so paid, prepaid or Converted), except that
interest payable at the Post-Default Rate shall be payable from time to time
on demand. Promptly after the determination of any interest rate provided for
herein or any change therein, the Administrative Agent shall give notice
thereof to the Lenders to which such interest is payable and to the Borrower.
Section 4. PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC.
4.01 PAYMENTS.
(a) Except to the extent otherwise provided herein, all payments of
principal, interest, Reimbursement Obligations and other amounts to be made
by the Borrower under this Agreement, and, except to the extent otherwise
provided therein, all payments to be made by the Obligors under any other
Loan Document, shall be made in the Currency in which such Loan or other
amount is denominated, in immediately available funds, without deduction,
set-off or counterclaim, to the Administrative Agent at an account in New
York, New York (or, if such payment is a payment of principal or interest
with respect to Sterling Loans, at an account in London, England) specified
by the Administrative Agent, not later than 1:00 p.m. New York time (or, if
such payment is a payment of principal or interest with respect to Sterling
Loans, 1:00 p.m. London time) on the date on which such payment shall become
due (each such payment made after
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such time on such due date to be deemed to have been made on the next
succeeding Business Day). All amounts owing under this Agreement (other than
principal of and interest on Sterling Loans) are denominated and payable in
Dollars.
(b) Any Lender for whose account any such payment is to be made may
(but shall not be obligated to) debit the amount of any such payment that is
not made to the Administrative Agent when due pursuant to Section 4.01(a)
hereof to any ordinary deposit account of the Borrower with such Lender (with
notice to the Borrower and the Administrative Agent), PROVIDED that such
Lender's failure to give such notice shall not affect the validity thereof.
(c) The Borrower shall, at the time of making each payment under
this Agreement for account of any Lender, specify to the Administrative Agent
(which shall so notify the intended recipient(s) thereof) the Loans,
Reimbursement Obligations or other amounts payable by the Borrower hereunder
to which such payment is to be applied (and in the event that the Borrower
fails to so specify, or if an Event of Default has occurred and is
continuing, the Administrative Agent may distribute such payment to the
Lenders for application in such manner as it or the Majority Lenders, subject
to Section 4.02 hereof, may determine to be appropriate).
(d) Except to the extent otherwise provided in the last sentence of
Section 2.03(e) hereof, each payment received by the Administrative Agent
under this Agreement for account of any Lender shall be paid by the
Administrative Agent promptly to such Lender, in immediately available funds,
for account of such Lender's Applicable Lending Office for the Loan or other
obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement would
otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable
for any principal so extended for the period of such extension.
4.02 PRO RATA TREATMENT. Except to the extent otherwise provided
herein: (a) each borrowing of Loans of a particular Class or Sub-Class from
the Lenders under Section 2.01 hereof shall be made from the relevant
Lenders, each payment of commitment fee under Section 2.05 hereof in respect
of Commitments of a particular Class shall be made for account of the
relevant Lenders, and each termination or reduction of the amount of the
Commitments of a particular Class or the Sterling Sub-Limits under Section
2.03 hereof shall be applied to the respective Commitments of such Class of
the relevant Lenders or the Sterling Sub-Limits, pro rata according to the
amounts of
CREDIT AGREEMENT
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their respective Commitments of such Class or their respective Sterling
Sub-Limits, as the case may be; (b) except as otherwise provided in Section
5.04 hereof, Eurocurrency Loans of any Class or Currency having the same
Interest Period shall be allocated pro rata among the relevant Lenders
according to the amounts of their respective Revolving Credit Commitments,
Sterling Sub-Limits, Tranche A Term Loan Commitments and Incremental Term
Loan Commitments (in the case of the making of Loans) or their respective
Dollar Loans, Sterling Loans, Tranche A Term Loans and Incremental Term Loans
(in the case of Conversions and Continuations of Loans); (c) each payment or
prepayment of principal of Dollar Loans, Sterling Loans, Tranche A Term Loans
and Incremental Term Loans by the Borrower shall be made for account of the
relevant Lenders pro rata in accordance with the respective unpaid principal
amounts of the Loans of such Class or Sub-Class held by them; and (d) each
payment of interest on Dollar Loans, Sterling Loans, Tranche A Term Loans and
Incremental Term Loans by the Borrower shall be made for account of the
relevant Lenders pro rata in accordance with the amounts of interest on such
Loans then due and payable to the respective Lenders.
4.03 COMPUTATIONS. Interest on Eurodollar Loans and commitment fee
and letter of credit fees shall be computed on the basis of a year of 360
days and actual days elapsed (including the first day but, except as
otherwise provided in Section 2.03(g) hereof, excluding the last day)
occurring in the period for which payable and interest on Eurosterling Loans,
Base Rate Loans and Reimbursement Obligations shall be computed on the basis
of a year of 365 or 366 days, as the case may be, and actual days elapsed
(including the first day but excluding the last day) occurring in the period
for which payable. Notwithstanding the foregoing, for each day that the Base
Rate is calculated by reference to the Federal Funds Rate, interest on Base
Rate Loans and Reimbursement Obligations shall be computed on the basis of a
year of 360 days and actual days elapsed.
4.04 MINIMUM AMOUNTS. Except for mandatory prepayments made
pursuant to Section 2.10 hereof and Conversions or prepayments made pursuant
to Section 5.04 hereof, (a) each borrowing, Conversion and partial prepayment
of principal of Base Rate Loans shall be in an aggregate amount at least
equal to $1,000,000 or a larger multiple of $100,000 and (b) each borrowing,
Continuation, Conversion or partial prepayment of principal of Eurocurrency
Loans shall be in an aggregate amount at least equal to $1,000,000 or a
larger multiple of $1,000,000, or, in the case of Sterling Loans, the
Sterling Equivalent thereof rounded downwards to the nearest L1,000
(borrowings, Conversions or prepayments of or into Loans of different Types
or, in the case of Eurocurrency Loans, having different Interest
CREDIT AGREEMENT
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Periods at the same time hereunder to be deemed separate borrowings,
Conversions and prepayments for purposes of the foregoing, one for each Type
or Interest Period), and if any Eurodollar Loans would otherwise be in a
lesser principal amount for any period, such Loans shall be Base Rate Loans
during such period.
4.05 CERTAIN NOTICES. Notices by the Borrower to the
Administrative Agent of terminations or reductions of the Commitments, of
borrowings, Conversions, Continuations and optional prepayments of Loans, of
Classes of Loans, of Currencies of Loans, of Types of Loans and of the
duration of Interest Periods shall be irrevocable and shall be effective only
if received by the Administrative Agent not later than 12:00 noon New York
time (or, if such notice relates to a borrowing, Continuation or optional
prepayment of Sterling Loans, not later than 12:00 noon London time) on the
number of Business Days prior to the date of the relevant termination,
reduction, borrowing, Conversion, Continuation or prepayment or the first day
of such Interest Period specified below:
Number of
Business
Notice Days Prior
------ -----------
Termination or reduction
of Commitments 3
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans 1
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurocurrency Loans 3
Notwithstanding the foregoing, the Borrower may give a notice of prepayment
of all outstanding Loans or termination of Commitments that is conditioned
upon the effectiveness of other credit facilities, in which case such notice
may be revoked by the Borrower (by notice to the Administrative Agent on or
prior to the specified effective date) if such condition is not satisfied.
Each such notice of termination or reduction shall specify the amount and the
Class of the Commitments to be terminated or reduced. Each such notice of
borrowing, Conversion, Continuation or optional prepayment shall specify the
Class of Loans to be borrowed, Converted, Continued or prepaid and the amount
(subject to Section 4.04 hereof) and Type of each Loan to be borrowed,
Converted, Continued or prepaid and the date of borrowing,
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Conversion, Continuation or optional prepayment (which shall be a Business
Day). Each notice of borrowing, Continuation or optional prepayment of
Revolving Credit Loans shall specify the Sub-Class of each Loan to be
borrowed, Continued or prepaid. Each such notice of the duration of an
Interest Period shall specify the Loans to which such Interest Period is to
relate. The Administrative Agent shall promptly notify the Lenders of the
contents of each such notice. In the event that the Borrower fails to select
the Type of Loan, or the duration of any Interest Period for any Eurodollar
Loan, within the time period and otherwise as provided in this Section 4.05,
such Loan (if outstanding as a Eurodollar Loan) will be automatically
Converted into a Base Rate Loan on the last day of the then current Interest
Period for such Loan or (if outstanding as a Base Rate Loan) will remain as,
or (if not then outstanding) will be made as, a Base Rate Loan. In the event
that the Borrower fails to select the duration of any Interest Period for any
Eurosterling Loan, the Borrower shall be deemed to have selected an interest
period of one month. In the event that the Borrower fails to select the
Sub-Class of any Revolving Credit Loan, such Loan will be made as a Dollar
Loan.
4.06 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT. Unless the
Administrative Agent shall have been notified by a Lender or the Borrower
(the "PAYOR") prior to the date on which the Payor is to make payment to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan to
be made by such Lender hereunder or (in the case of the Borrower) a payment
to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called the "REQUIRED PAYMENT"), which
notice shall be effective upon receipt, that the Payor does not intend to
make the Required Payment to the Administrative Agent, the Administrative
Agent may assume that the Required Payment has been made and may, in reliance
upon such assumption (but shall not be required to), make the amount thereof
available to the intended recipient(s) on such date; and, if the Payor has
not in fact made the Required Payment to the Administrative Agent, the
recipient(s) of such payment shall, on demand, repay to the Administrative
Agent the amount so made available together with interest thereon in respect
of each day during the period commencing on the date (the "ADVANCE DATE")
such amount was so made available by the Administrative Agent until the date
the Administrative Agent recovers such amount at a rate per annum equal to
the Federal Funds Rate for such day and, if such recipient(s) shall fail
promptly to make such payment, the Administrative Agent shall be entitled to
recover such amount, on demand, from the Payor, together with interest as
aforesaid, PROVIDED that if neither the recipient(s) nor the Payor shall
return the Required Payment to the Administrative Agent within three Business
Days of the Advance Date, then, retroactively to the Advance Date, the Payor
and the recipient(s)
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shall each be obligated to pay interest on the Required Payment as follows:
(i) if the Required Payment shall represent a payment to be
made by the Borrower to the Lenders, the Borrower and the
recipient(s) shall each be obligated retroactively to the Advance
Date to pay interest in respect of the Required Payment at the
Post-Default Rate (without duplication of the obligation of the
Borrower under Section 3.02 hereof to pay interest on the Required
Payment at the Post-Default Rate), it being understood that the
return by the recipient(s) of the Required Payment to the
Administrative Agent shall not limit such obligation of the
Borrower under said Section 3.02 to pay interest at the
Post-Default Rate in respect of the Required Payment, and
(ii) if the Required Payment shall represent proceeds of a Loan
to be made by the Lenders to the Borrower, the Payor and the
Borrower shall each be obligated retroactively to the Advance Date
to pay interest in respect of the Required Payment pursuant to
whichever of the rates specified in Section 3.02 hereof is
applicable to the Type of such Loan, it being understood that the
return by the Borrower of the Required Payment to the
Administrative Agent shall not limit any claim the Borrower may
have against the Payor in respect of such Required Payment.
4.07 SHARING OF PAYMENTS, ETC.
(a) Each Obligor agrees that, in addition to (and without
limitation of) any right of set-off, banker's lien or counterclaim a Lender
may otherwise have, each Lender shall be entitled, at its option (to the
fullest extent permitted by law), to set off and apply any deposit (general
or special, time or demand, provisional or final), or other indebtedness,
held by it for the credit or account of such Obligor at any of its offices,
in Dollars or in any other currency, against any principal of or interest on
any of such Lender's Loans, Reimbursement Obligations or any other amount
payable to such Lender hereunder, that is not paid when due (regardless of
whether such deposit or other indebtedness is then due to such Obligor), in
which case it shall promptly notify such Obligor and the Administrative Agent
thereof, PROVIDED that such Lender's failure to give such notice shall not
affect the validity thereof.
(b) If any Lender shall obtain from any Obligor payment of any
principal of or interest on any Loan of any Class denominated in a Currency
owing to it or any Letter of Credit Liability owing to it or payment of any
other amount under this Agreement or any other Loan Document through the
exercise of any right of set-off, banker's lien or counterclaim or similar
right
CREDIT AGREEMENT
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or otherwise (other than from the Administrative Agent as provided herein),
and, as a result of such payment, such Lender shall have received a greater
percentage of the principal of or interest on the Loans of such Class and
denominated in such Currency (the "APPLICABLE LOANS") or Letter of Credit
Liabilities or such other amounts then due hereunder or thereunder by such
Obligor to such Lender than the percentage received by any other Lender to
which principal of or interest on the Applicable Loans or Letter of Credit
Liabilities or such other amounts is then due hereunder, it shall promptly
purchase from such other Lenders participations in (or, if and to the extent
specified by such Lender, direct interests in) the Applicable Loans or Letter
of Credit Liabilities or such other amounts, respectively, owing to such
other Lenders (or in interest due thereon, as the case may be) in such
amounts, and make such other adjustments from time to time as shall be
equitable, to the end that all the Lenders shall share the benefit of such
excess payment (net of any expenses that may be incurred by such Lender in
obtaining or preserving such excess payment) pro rata in accordance with the
unpaid principal of and/or interest on the Applicable Loans or Letter of
Credit Liabilities or such other amounts, respectively, owing to each of the
Lenders. To such end all the Lenders shall make appropriate adjustments
among themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be restored.
(c) The Borrower agrees that any Lender so purchasing such a
participation (or direct interest) may exercise all rights of set-off,
banker's lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Loans or
other amounts (as the case may be) owing to such Lender in the amount of such
participation.
(d) Nothing contained herein shall require any Lender to exercise
any such right or shall affect the right of any Lender to exercise, and
retain the benefits of exercising, any such right with respect to any other
indebtedness or obligation of any Obligor. If, under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured
claim in lieu of a set-off to which this Section 4.07 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section 4.07 to share in the benefits of any recovery on such
secured claim.
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Section 5. YIELD PROTECTION, ETC.
5.01 ADDITIONAL COSTS.
(a) The Borrower shall pay directly to each Lender from time to
time such amounts as such Lender may determine to be necessary to compensate
such Lender for any costs that such Lender determines are attributable to its
making or maintaining of any Eurocurrency Loans or its obligation to make any
Eurocurrency Loans hereunder, or any reduction in any amount receivable by
such Lender hereunder in respect of any of such Loans or such obligation
(such increases in costs and reductions in amounts receivable being herein
called "ADDITIONAL COSTS"), resulting from any Regulatory Change that:
(i) shall subject any Lender (or its Applicable Lending Office
for any of such Loans) to any tax, duty or other charge in respect
of such Loans or changes the basis of taxation of any amounts
payable to such Lender under this Agreement in respect of any of
such Loans (excluding changes in the rate of tax on the overall net
income of such Lender or of such Applicable Lending Office by the
jurisdiction in which such Lender has its principal office or such
Applicable Lending Office and excluding any U.S. Taxes that would
not be payable under the proviso in the first paragraph of Section
5.07(a) hereof); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than, in the case of any Lender for any period
as to which the Borrower is required to pay any amount under
paragraph (d) below, the reserves against "Eurocurrency
liabilities" under Regulation D therein referred to) relating to
any extensions of credit or other assets of, or any deposits with
or other liabilities of, such Lender (including, without
limitation, any of such Loans or any deposits referred to in the
definition of "Eurocurrency Rate" in Section 1.01 hereof), or any
commitment of such Lender (including, without limitation, the
Commitments of such Lender hereunder); or
(iii) imposes any other condition affecting this Agreement (or
any of such extensions of credit or liabilities) or its Commitments.
If any Lender requests compensation from the Borrower under this Section
5.01(a), the Borrower may, by notice to such Lender (with a copy to the
Administrative Agent), suspend the obligation of such Lender thereafter to
make or Continue Eurocurrency Loans, or to Convert Base Rate Loans into
Eurodollar Loans, until the Regulatory Change giving rise to such request
ceases to be in
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effect (in which case the provisions of Section 5.04 hereof shall be
applicable), PROVIDED that such suspension shall not affect the right of such
Lender to receive the compensation so requested.
(b) Without limiting the effect of the foregoing provisions of this
Section 5.01 (but without duplication), the Borrower shall pay directly to
each Lender from time to time on request such amounts as such Lender may
determine to be necessary to compensate such Lender (or, without duplication,
the holding company of which such Lender is a subsidiary) for any costs that
it determines are attributable to the maintenance by such Lender (or any
Applicable Lending Office or such holding company), pursuant to any law or
regulation or any interpretation, directive or request (whether or not having
the force of law and whether or not failure to comply therewith would be
unlawful) of any court or governmental or monetary authority (i) following
any Regulatory Change or (ii) implementing any risk-based capital guideline
or other requirement (whether or not having the force of law and whether or
not the failure to comply therewith would be unlawful) hereafter issued by
any government or governmental or supervisory authority implementing at the
national level the Basle Accord, of capital in respect of its Commitments or
Loans (such compensation to include, without limitation, an amount equal to
any reduction of the rate of return on assets or equity of such Lender (or
any Applicable Lending Office or such holding company) to a level below that
which such Lender (or any Applicable Lending Office or such holding company)
could have achieved but for such law, regulation, interpretation, directive
or request).
(c) Each Lender shall notify the Borrower of any event occurring after
the Effective Date entitling such Lender to compensation under Section
5.01(a) or 5.01(b) hereof as promptly as practicable, but in any event within
45 days, after such Lender obtains actual knowledge thereof; PROVIDED that
(i) if any Lender fails to give such notice within 45 days after it obtains
actual knowledge of such an event, such Lender shall, with respect to
compensation payable pursuant to this Section 5.01 in respect of any costs
resulting from such event, only be entitled to payment under this Section
5.01 for costs incurred from and after the date 45 days prior to the date
that such Lender does give such notice and (ii) each Lender will designate a
different Applicable Lending Office for the Loans of such Lender affected by
such event if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the sole opinion of such Lender, be
disadvantageous to such Lender, except that such Lender shall have no
obligation to designate an Applicable Lending Office located in the United
States of America. Each Lender will furnish to the Borrower a certificate
setting forth the basis and amount of each request by such Lender
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for compensation under Section 5.01(a) or 5.01(b) hereof. Determinations and
allocations by any Lender for purposes of this Section 5.01 of the effect of
any Regulatory Change pursuant to Section 5.01(a) hereof, or of the effect of
capital maintained pursuant to Section 5.01(b) hereof, on its costs or rate
of return of maintaining Loans or its obligation to make Loans, or on amounts
receivable by it in respect of Loans, and of the amounts required to
compensate such Lender under this Section 5.01, shall be conclusive, PROVIDED
that such determinations and allocations are made on a reasonable basis.
(d) Without limiting the effect of the foregoing, the Borrower shall pay
to each Lender on the last day of each Interest Period so long as such Lender
is maintaining reserves against "Eurocurrency liabilities" under Regulation D
(or, unless the provisions of paragraph (b) above are applicable, so long as
such Lender is, by reason of any Regulatory Change, maintaining reserves
against any other category of liabilities that includes deposits by reference
to which the interest rate on Eurocurrency Loans is determined as provided in
this Agreement or against any category of extensions of credit or other
assets of such Lender that includes any Eurocurrency Loans) an additional
amount (determined by such Lender and notified to the Borrower through the
Administrative Agent) equal to the product of the following for each
Eurocurrency Loan for each day during such Interest Period:
(i) the principal amount of such Eurocurrency Loan outstanding on
such day; and
(ii) the remainder of (x) a fraction the numerator of which is the
rate (expressed as a decimal) at which interest accrues on such Eurocurrency
Loan for such Interest Period as provided in this Agreement (less the
Applicable Margin) and the denominator of which is one MINUS the effective
rate (expressed as a decimal) at which such reserve requirements are
imposed on such Lender on such day MINUS (y) such numerator; and
(iii) 1/360.
5.02 LIMITATION ON TYPES OF LOANS. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of the Eurocurrency
Rate for any Interest Period for any Eurocurrency Loan;
(a) the Administrative Agent determines, which determination shall
be conclusive, that quotations of interest rates for the relevant deposits
referred to in the definition of "Eurocurrency Rate" in Section 1.01 hereof
are not being provided in the relevant amounts or for the
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relevant maturities for purposes of determining rates of interest for
Eurocurrency Loans as provided herein; or
(b) if the Majority Lenders determine, which determination shall be
conclusive, and notify the Administrative Agent that the relevant rates of
interest referred to in the definition of "Eurocurrency Rate" in Section
1.01 hereof upon the basis of which the rate of interest for Eurocurrency
Loans for such Interest Period is to be determined are not likely adequately
to cover the cost to such Lenders of making or maintaining Eurocurrency
Loans for such Interest Period;
then the Administrative Agent shall give the Borrower and each Lender prompt
notice thereof and, so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurocurrency Loans, to
Continue Eurocurrency Loans or to Convert Base Rate Loans into Eurodollar
Loans, and the Borrower shall, on the last day(s) of the then current
Interest Period(s) for the outstanding Eurocurrency Loans, either prepay such
Loans or, in the case of Eurodollar Loans, Convert such Loans into Base Rate
Loans in accordance with Section 2.09 hereof.
5.03 ILLEGALITY. Notwithstanding any other provision of this Agreement,
in the event that it becomes unlawful, or any central bank or other
governmental authority asserts that it is unlawful, for any Lender or its
Applicable Lending Office to honor its obligation to make or maintain
Eurocurrency Loans hereunder (and, in the sole opinion of such Lender, the
designation of a different Applicable Lending Office would either not avoid
such unlawfulness or would be disadvantageous to such Lender), then such
Lender shall promptly notify the Borrower thereof (with a copy to the
Administrative Agent) and such Lender's obligation to make or Continue
Eurocurrency Loans, or to Convert Base Rate Loans into Eurodollar Loans,
shall be suspended until such time as such Lender may again make and maintain
Eurocurrency Loans (in which case the provisions of Section 5.04 hereof shall
be applicable).
5.04 TREATMENT OF AFFECTED LOANS. If the obligation of any Lender to
make Eurodollar Loans or to Continue, or to Convert Base Rate Loans into,
Eurodollar Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof,
such Lender's Eurodollar Loans shall be automatically Converted into Base
Rate Loans on the last day(s) of the then current Interest Period(s) for
Eurodollars Loans (or, in the case of a Conversion resulting from a
circumstance described in Section 5.03 hereof, on such earlier date as such
Lender may specify to the Borrower with a copy to the Administrative Agent)
and, unless and until such Lender gives notice as provided below that the
circumstances specified in
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Section 5.01 or 5.03 hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Lender's Eurodollar Loans shall be applied instead to
its Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such
Lender as Eurodollar Loans shall be made or Converted into Base Rate Loans,
and all Base Rate Loans of such Lender that would otherwise be Converted
into Eurodollar Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrower with a copy to the Administrative
Agent that the circumstances specified in Section 5.01 or 5.03 hereof that
gave rise to the Conversion of such Lender's Eurodollar Loans pursuant to
this Section 5.04 no longer exist (which such Lender agrees to do promptly
upon such circumstances ceasing to exist) at a time when Eurodollar Loans of
the same Class made by other Lenders are outstanding, such Lender's Base Rate
Loans of such Class shall be automatically Converted, on the first day(s) of
the next succeeding Interest Period(s) for such outstanding Eurodollar Loans,
to the extent necessary so that, after giving effect thereto, all Base Rate
Loans and Eurodollar Loans of such Class are allocated among the Lenders
ratably (as to principal amounts, Types and Interest Periods) in accordance
with their respective Commitments of such Class.
If the obligation of any Sterling Lender to make or Continue Eurosterling
Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof, then,
unless and until such Lender gives notice to the Borrower with a copy to the
Administrative Agent that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to such suspension no longer exist (which such Lender
agrees to do promptly upon such circumstances ceasing to exist), all Sterling
Loans that would otherwise be made by a Sterling Lender as Eurosterling Loans
shall be made as Dollar Loans.
5.05 COMPENSATION. The Borrower shall pay to the Administrative Agent
for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense (including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds required
by such Lender to fund its Eurocurrency
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Loans) which such Lender may sustain:
(a) if any payment, mandatory or optional prepayment or Conversion
of a Eurocurrency Loan made by such Lender for any reason (including,
without limitation, the acceleration of the Loans pursuant to Section 10
hereof) occurs on a date other than the last day of the Interest Period for
such Loan; or
(b) if the Borrower fails for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 7 hereof to be satisfied) to borrow a Eurocurrency Loan from such
Lender on the date for such borrowing specified in the relevant notice of
borrowing given pursuant to Section 2.02 hereof.
Calculation of all amounts payable to a Lender under this Section 5.05 shall
be made as though such Lender had actually funded its relevant Eurocurrency
Loan through the purchase of a Eurocurrency deposit bearing interest at the
Eurocurrency Rate in an amount equal to the amount of such Loan, having a
maturity comparable to the relevant Interest Period and through the transfer
of such Eurocurrency deposit from an offshore office of such Lender to a
domestic office of such Lender in the United States of America; PROVIDED,
HOWEVER, that each Lender may fund each of its Eurocurrency Loans in any
manner it sees fit and the foregoing assumption shall be utilized only for
the calculation of amounts payable under this Section 5.05.
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5.06 ADDITIONAL COSTS IN RESPECT OF LETTERS OF CREDIT. Without limiting
the obligations of the Borrower under Section 5.01 hereof (but without
duplication), if as a result of any Regulatory Change or any risk-based
capital guideline or other requirement heretofore or hereafter issued by any
government or governmental or supervisory authority implementing at the
national level the Basle Accord there shall be imposed, modified or deemed
applicable any tax, reserve, special deposit, capital adequacy or similar
requirement against or with respect to or measured by reference to Letters of
Credit issued or to be issued hereunder and the result shall be to increase
the cost to any Lender or Lenders of issuing (or purchasing participations
in) or maintaining its obligation hereunder to issue (or purchase
participations in) any Letter of Credit hereunder or reduce any amount
receivable by any Lender hereunder in respect of any Letter of Credit (which
increases in cost, or reductions in amount receivable, shall be the result of
such Lender's or Lenders' reasonable allocation of the aggregate of such
increases or reductions resulting from such event), then, upon demand by such
Lender or Lenders (through the Administrative Agent), the Borrower shall pay
immediately to the Administrative Agent for account of such Lender or
Lenders, from time to time as specified by such Lender or Lenders (through
the Administrative Agent), such additional amounts as shall be sufficient to
compensate such Lender or Lenders (through the Administrative Agent) for such
increased costs or reductions in amount. A statement as to such increased
costs or reductions in amount incurred by any such Lender or Lenders,
submitted by such Lender or Lenders to the Borrower shall be conclusive in
the absence of manifest error as to the amount thereof.
5.07 U.S. TAXES.
(a) The Borrower agrees to pay to each Lender that is not a U.S. Person
such additional amounts as are necessary in order that the net payment of any
amount due to such non-U.S. Person hereunder after deduction for or
withholding in respect of any U.S. Taxes imposed with respect to such payment
(or in lieu thereof, payment of such U.S. Taxes by such non-U.S. Person),
will not be less than the amount stated herein to be then due and payable,
PROVIDED that the foregoing obligation to pay such additional amounts shall
not apply:
(i) to any payment to any Lender hereunder (other than in respect
of any Registered Loan) unless such Lender is, on the Effective Date (or on
the date it becomes a Lender hereunder as provided in Section 12.06(b)
hereof) and on the date of any change in the Applicable Lending Office of
such Lender, either entitled to submit a Form 1001 (relating to such Lender
and entitling it to a complete exemption from withholding on all interest to
be received by it hereunder
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in respect of the Loans) or Form 4224 (relating to all interest to be
received by such Lender hereunder in respect of the Loans),
(ii) to any payment to any Lender hereunder in respect of a
Registered Loan (a "REGISTERED HOLDER"), unless such Registered Holder (or,
if such Registered Holder is not the beneficial owner of such Registered
Loan, the beneficial owner thereof) is, on the Effective Date (or on the
date such Registered Holder becomes a Lender as provided in Section 12.06(b)
hereof) and on the date of any change in the Applicable Lending Office of
such Lender, entitled to submit a Form W-8, together with an annual
certificate stating that such Registered Holder (or beneficial owner, as the
case may be) (w) is not a "bank" within the meaning of Section 881(c)(3)(A)
of the Code, (x) is not a 10-percent shareholder (within the meaning of
Section 871(h)(3)(B) of the Code) of the Borrower, (y) is not a controlled
foreign corporation related to the Borrower (within the meaning of Section
871(h)(4)(B) of the Code) and (z) is not acting as a conduit entity (within
the meaning of U.S. Treasury Regulation Section 1.881-3), or
(iii) to any U.S. Taxes imposed solely by reason of the failure by
such non-U.S. Person (or, if such non-U.S. Person is not the beneficial
owner of the relevant Loan, such beneficial owner) to comply with applicable
certification, information, documentation or other reporting requirements
(including, without limitation, the failure to timely submit a Form 1001,
4224 or W-8 (together with the annual certificate required under clause (ii)
above), as applicable) concerning the nationality, residence, identity or
connections with the United States of America of such non-U.S. Person (or
beneficial owner, as the case may be) if such compliance is required by
statute or regulation of the United States of America as a precondition to
relief or exemption from such U.S. Taxes.
For the purposes of this Section 5.07(a), (A) "FORM 1001" shall mean Form
1001 (Ownership, Exemption, or Reduced Rate Certificate) of the Department of
the Treasury of the United States of America, (B) "FORM 4224" shall mean Form
4224 (Exemption from Withholding of Tax on Income Effectively Connected with
the Conduct of a Trade or Business in the United States) of the Department of
the Treasury of the United States of America and (C) "FORM W-8" shall mean
Form W-8 (Certificate of Foreign Status) of the Department of Treasury of the
United States of America. Each of the Forms referred to in the foregoing
clauses (A), (B) and (C) shall include such successor and related forms as
may from time to time be adopted by the relevant taxing authorities of the
United States of America to
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document a claim to which such Form relates.
(b) Within 30 days after paying any amount to the Administrative Agent
or any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the
Borrower shall deliver to the Administrative Agent for delivery to such
non-U.S. Person evidence satisfactory to such Person of such deduction,
withholding or payment (as the case may be).
(c) The Borrower further agrees to pay to each Sterling Lender such
additional amounts as are necessary in order that the net payment of any
amount due to such Sterling Lender that is not a U.K. Person hereunder after
deduction for or withholding in respect of any U.K. Taxes imposed with
respect to such payment (or in lieu thereof, payment of such U.K. Taxes by
such non-U.K. Person), will not be less than the amount stated herein to be
then due and payable, PROVIDED that the foregoing obligation to pay such
additional amounts shall not apply:
(i) to any payment to any Sterling Lender hereunder unless such
Sterling Lender is, on the date hereof (or on the date it becomes a
Sterling Lender hereunder as provided in Section 12.06(b) hereof) and on
the date of any change in the Applicable Lending Office for Sterling Loans
of such Sterling Lender, either entitled to a complete exemption from
withholding or deduction by the Borrower of U.K. Taxes on all interest to
be received by such Sterling Lender hereunder in respect of the Sterling
Loans made by such Sterling Lender to the Borrower, or
(ii) to any U.K. Taxes required to be deducted or withheld solely
by reason of the failure by such Sterling Lender to comply with applicable
certification, information, documentation or other reporting requirements
concerning the nationality, residence, identity or connections with the
United Kingdom of such Sterling Lender if such compliance is required by
statute or regulation as a precondition to relief or exemption from such
U.K. Taxes.
5.08 REPLACEMENT LENDERS. At any time within 30 days after the payment
by the Borrower to any Lender of any amount pursuant to Section 5.01(a),
5.01(b) or 5.07 hereof that the Borrower deems material, the Borrower may, by
notice to the Administrative Agent and each Lender that requested the payment
of such amount, nominate or propose a bank or other financial institution
that is willing to become the assignee of the Loans and (if any) Commitments
of such Lender (a "REPLACEMENT LENDER") pursuant to Section 12.06(b) hereof,
and within 15 Business Days after receipt of such proposal from the Borrower,
such Lender
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shall execute and deliver to the Administrative Agent an Assignment and
Acceptance substantially in the form of Exhibit G hereto whereby such Lender
shall assign its entire Loans and (if any) Commitments to the proposed
Replacement Lender in accordance with Section 12.06(b) hereof unless, prior
to the expiration of such period, the Administrative Agent shall have
notified the Borrower and such Lender that the proposed Replacement Lender is
not reasonably acceptable to the Administrative Agent; PROVIDED that in no
event will (i) any Lender be required to enter into such Assignment and
Acceptance under this Section 5.08 at a price less than par plus accrued
interest and prorated fees and other costs due hereunder (including, without
limitation, break funding costs incurred by such Lender as a result of such
assignment being effected on a day other than the last day of an Interest
Period, which amount (if any) shall be payable by the Borrower to such
Lender) to the effective date thereof, (ii) the Administrative Agent or any
Lender be obligated to assist the Borrower in identifying any Person that is
willing to become such a Replacement Lender and (iii) any such assignment be
required if the consummation thereof conflicts with any law, regulation or
rule.
Section 6. GUARANTEE.
6.01 THE GUARANTEE. The Subsidiary Guarantors hereby jointly and
severally guarantee to each Lender and the Administrative Agent and their
respective successors and assigns the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the principal
of and interest on the Loans made by the Lenders to the Borrower and all
other amounts from time to time owing to the Lenders or the Administrative
Agent by the Borrower under this Agreement and by any Obligor under any of
the other Loan Documents (including, without limitation, all Reimbursement
Obligations), and all obligations of the Borrower or any of its Subsidiaries
to any Lender or any affiliate of a Lender in respect of any Interest Rate
Protection Agreement, in each case strictly in accordance with the terms
thereof (such obligations being herein collectively called the "GUARANTEED
OBLIGATIONS"). The Subsidiary Guarantors hereby further jointly and
severally agree that if the Borrower shall fail to pay in full when due
(whether at stated maturity, by acceleration or otherwise) any of the
Guaranteed Obligations, the Subsidiary Guarantors will promptly pay the same,
without any demand or notice whatsoever, and that in the case of any
extension of time of payment or renewal of any of the Guaranteed Obligations,
the same will be promptly paid in full when due (whether at extended
maturity, by acceleration or otherwise) in accordance with the terms of such
extension or renewal.
6.02 OBLIGATIONS UNCONDITIONAL. The obligations of
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the Subsidiary Guarantors under Section 6.01 hereof are absolute and
unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the obligations of the Borrower
under this Agreement or any other agreement or instrument referred to herein
or therein, or any substitution, release or exchange of any other guarantee
of or security for any of the Guaranteed Obligations, and, to the fullest
extent permitted by applicable law, irrespective of any other circumstance
whatsoever that might otherwise constitute a legal or equitable discharge or
defense of a surety or guarantor, it being the intent of this Section 6.02
that the obligations of the Subsidiary Guarantors hereunder shall be absolute
and unconditional, joint and several, under any and all circumstances.
Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the
liability of the Subsidiary Guarantors hereunder, which shall remain absolute
and unconditional as described above:
(i) at any time or from time to time, without notice to the
Subsidiary Guarantors, the time for any performance of or compliance with
any of the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or any other agreement or instrument referred to herein or therein
shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement or
any other agreement or instrument referred to herein or therein shall be
waived or any other guarantee of any of the Guaranteed Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of the
Guaranteed Obligations shall fail to be perfected.
The Subsidiary Guarantors hereby expressly waive diligence, presentment,
demand of payment, protest and all notices whatsoever, and any requirement
that the Administrative Agent or any Lender exhaust any right, power or
remedy or proceed against the Borrower under this Agreement or any other
agreement or instrument referred to herein or therein, or against any other
Person under any other guarantee of, or security for, any of the
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67
Guaranteed Obligations.
6.03 REINSTATEMENT. The obligations of the Subsidiary Guarantors
under this Section 6 shall be automatically reinstated if and to the extent
that for any reason any payment by or on behalf of the Borrower in respect of
the Guaranteed Obligations is rescinded or must be otherwise restored by any
holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Subsidiary
Guarantors jointly and severally agree that they will indemnify the
Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, fees of counsel) incurred by the
Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending
against any claim alleging that such payment constituted a preference,
fraudulent transfer or similar payment under any bankruptcy, insolvency or
similar law.
6.04 SUBROGATION. The Subsidiary Guarantors hereby jointly and
severally agree that until the payment and satisfaction in full of all
Guaranteed Obligations and the expiration and termination of the Commitments
of the Lenders under this Agreement they shall not exercise any right or
remedy arising by reason of any performance by them of their guarantee in
Section 6.01 hereof, whether by subrogation or otherwise, against the
Borrower or any other Subsidiary Guarantor of any of the Guaranteed
Obligations or any security for any of the Guaranteed Obligations.
6.05 REMEDIES. The Subsidiary Guarantors jointly and severally
agree that, as between the Subsidiary Guarantors and the Lenders, the
obligations of the Borrower under this Agreement may be declared to be
forthwith due and payable as provided in Section 10 hereof (and shall be
deemed to have become automatically due and payable in the circumstances
provided in said Section 10) for purposes of Section 6.01 hereof
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable)
as against the Borrower and that, in the event of such declaration (or such
obligations being deemed to have become automatically due and payable), such
obligations (whether or not due and payable by the Borrower) shall forthwith
become due and payable by the Subsidiary Guarantors for purposes of said
Section 6.01.
6.06 INSTRUMENT FOR THE PAYMENT OF MONEY. Each Subsidiary
Guarantor hereby acknowledges that the guarantee in this Section 6
constitutes an instrument for the payment of money, and consents and agrees
that any Lender or the Administrative Agent, at its sole option, in the event
of a
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68
dispute by such Subsidiary Guarantor in the payment of any moneys due
hereunder, shall have the right to bring motion-action under New York CPLR
Section 3213.
6.07 CONTINUING GUARANTEE. The guarantee in this Section 6 is a
continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.
6.08 RIGHTS OF CONTRIBUTION. The Subsidiary Guarantors hereby
agree, as between themselves, that if any Subsidiary Guarantor shall become
an Excess Funding Guarantor (as defined below) by reason of the payment by
such Subsidiary Guarantor of any Guaranteed Obligations, each other
Subsidiary Guarantor shall, on demand of such Excess Funding Guarantor (but
subject to the next sentence), pay to such Excess Funding Guarantor an amount
equal to such Subsidiary Guarantor's Pro Rata Share (as defined below and
determined, for this purpose, without reference to the Properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as
defined below) in respect of such Guaranteed Obligations. The payment
obligation of a Subsidiary Guarantor to any Excess Funding Guarantor under
this Section 6.08 shall be subordinate and subject in right of payment to the
prior payment in full of the obligations of such Subsidiary Guarantor under
the other provisions of this Section 6 and such Excess Funding Guarantor
shall not exercise any right or remedy with respect to such excess until
payment and satisfaction in full of all of such obligations.
For purposes of this Section 6.08, (i) "EXCESS FUNDING GUARANTOR"
shall mean, in respect of any Guaranteed Obligations, a Subsidiary Guarantor
that has paid an amount in excess of its Pro Rata Share of such Guaranteed
Obligations, (ii) "EXCESS PAYMENT" shall mean, in respect of any Guaranteed
Obligations, the amount paid by an Excess Funding Guarantor in excess of its
Pro Rata Share of such Guaranteed Obligations and (iii) "PRO RATA SHARE"
shall mean, for any Subsidiary Guarantor, the ratio (expressed as a
percentage) of (x) the amount by which the aggregate present fair saleable
value of all Properties of such Subsidiary Guarantor (excluding any shares of
stock of any other Subsidiary Guarantor) exceeds the amount of all the debts
and liabilities of such Subsidiary Guarantor (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of such Subsidiary Guarantor hereunder and any obligations of any
other Subsidiary Guarantor that have been Guaranteed by such Subsidiary
Guarantor) to (y) the amount by which the aggregate fair saleable value of
all Properties of all of the Borrower and the Subsidiary Guarantors exceeds
the amount of all the debts and liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of the Borrower and the Subsidiary Guarantors hereunder and under
the other Loan Documents) of the
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Borrower and the Subsidiary Guarantors, determined (A) with respect to any
Subsidiary Guarantor that is a party hereto on the Effective Date, as of the
Effective Date, and (B) with respect to any other Subsidiary Guarantor, as of
the date such Subsidiary Guarantor becomes a Subsidiary Guarantor hereunder.
6.09 GENERAL LIMITATION ON GUARANTEE OBLIGATIONS. In any action
or proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Subsidiary Guarantor under
Section 6.01 hereof would otherwise, taking into account the provisions of
Section 6.08 hereof, be held or determined to be void, invalid or
unenforceable, or subordinated to the claims of any other creditors, on
account of the amount of its liability under said Section 6.01, then,
notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Subsidiary
Guarantor, any Lender, the Administrative Agent or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as
determined in such action or proceeding.
Section 7. CONDITIONS PRECEDENT.
7.01 EFFECTIVENESS AND INITIAL EXTENSION OF CREDIT. The
effectiveness of this Agreement and the obligation of any Lender to make its
initial extension of credit hereunder (whether by making a Loan or issuing a
Letter of Credit) is subject to the conditions precedent that the
Administrative Agent shall have received, on or before July 31, 1997, the
following documents (with sufficient copies for each Lender), each of which
shall be reasonably satisfactory to the Administrative Agent (and to the
extent specified below, to each Lender) in form and substance:
(a) CORPORATE DOCUMENTS. Certified copies of the charter and
by-laws (or equivalent documents) of each Obligor and of all partnership
and corporate authority for each Obligor (including, without limitation,
board of director resolutions and evidence of the incumbency, including
specimen signatures, of officers) with respect to the execution,
delivery and performance of such of the Basic Documents to which such
Obligor is intended to be a party and each other document to be
delivered by such Obligor from time to time in connection herewith and
the extensions of credit hereunder (and the Administrative Agent and
each Lender may conclusively rely on such certificate until it receives
notice in writing from such Obligor to the contrary).
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(b) SENIOR OFFICER'S CERTIFICATE. A certificate of a Senior
Officer, dated the Effective Date, to the effect set forth in the first
sentence of Section 7.02 hereof.
(c) OPINIONS OF COUNSEL TO THE OBLIGORS. Opinions, dated the
Effective Date, of (i) Xxxxxxx Xxxx & Xxxxxxxxx, special New York
counsel to the Obligors, substantially in the form of Exhibit C hereto,
(ii) Osler, Xxxxxx & Harcourt, special Canadian counsel to Panavision
Canadian Holdings Inc. and (iii) Xxxx Gully Buddle Xxxx, special New
Zealand counsel to the Borrower, in each case in form and substance
satisfactory to the Lenders and (in the case of clause (i)) covering
such other matters as the Administrative Agent or any Lender may
reasonably request (and each Obligor hereby instructs each such counsel
to deliver such opinion to the Lenders and the Administrative Agent).
(d) OPINIONS OF COUNSEL TO CHASE. Opinions, dated the Effective
Date, of (i) Milbank, Tweed, Xxxxxx & XxXxxx, special New York counsel
to Chase, substantially in the form of Exhibit D hereto and (ii)
Milbank, Tweed, Xxxxxx & XxXxxx, special English counsel to Chase (and
Chase hereby instructs each such counsel to deliver such opinions to the
Lenders).
(e) SECURITY AGREEMENT. The Security Agreement, duly executed and
delivered by the Borrower, each of the other Obligors party thereto and
the Administrative Agent and the certificates identified under the name
of each such Obligor in Annex 1 thereto, in each case accompanied by
undated stock powers executed in blank. In addition, each Obligor shall
have taken such other action (including, without limitation, delivering
to the Administrative Agent, for filing, appropriately completed and
duly executed copies of Uniform Commercial Code financing statements) as
the Administrative Agent shall have requested in order to perfect the
security interests created pursuant to the Security Agreement.
(f) NEW ZEALAND PLEDGE AGREEMENTS. The New Zealand Pledge
Agreement, duly executed and delivered by the Borrower and the
Administrative Agent and the share certificate(s) of Visual Action NZ
identified therein (in each case accompanied by undated stock transfer
forms executed in blank). In addition, the Borrower shall have taken
such other action as the Administrative Agent shall have requested in
order to create valid first priority Liens on the shares of Visual
Action NZ.
(g) U.K. PLEDGE AGREEMENTS. The U.K. Pledge Agreement, duly
executed and delivered by the Borrower and
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71
the Administrative Agent and the share certificate(s) of Panavision Europe
identified therein (in each case accompanied by undated stock transfer
forms executed in blank). In addition, the Borrower shall have taken
such other action as the Administrative Agent shall have requested in
order to create valid first priority Liens on the shares of Panavision
Europe.
(h) INSURANCE. Certificates of insurance evidencing the existence
of all insurance required to be maintained by the Borrower pursuant to
Section 9.04 hereof and the designation of the Administrative Agent as
the loss payee or additional named insured, as the case may be,
thereunder to the extent required by said Section 9.04, such
certificates to be in such form and contain such information as is
specified in said Section 9.04.
(i) CONSUMMATION OF THE VISUAL ACTION ACQUISITION. Evidence that
prior to or concurrently with the making of the initial extensions of
credit hereunder:
(i) the condition set forth in clause 5 of the Visual Action
Acquisition Agreement shall have been satisfied and "Completion"
(as defined therein) shall have occurred in accordance with clause
4 thereof, and each other transaction contemplated by the
Acquisition shall have been consummated and no material provision
of the Acquisition Documents shall have been waived, amended,
supplemented or otherwise modified; and
(ii) the aggregate cash consideration paid in respect of the
Acquisition on the Effective Date shall be in an aggregate amount
shall not exceed L37,500,00 (subject to purchase price adjustments
as set forth in the Visual Action Acquisition Agreement);
and the Administrative Agent shall have received a certificate from a
Senior Officer to such effect.
(j) COPIES OF THE VISUAL ACTION ACQUISITION DOCUMENTS. Copies of
(i) each Visual Action Acquisition Document, each as in effect on the
Effective Date, and (ii) upon the request of the Administrative Agent,
any agreement, certificate, court order or other writing delivered by
any party to the Acquisition Documents in connection with the closings
thereunder.
(k) REPAYMENT OF EXISTING INDEBTEDNESS. Evidence that the
principal of and interest on, and all other amounts owing in respect of,
the Indebtedness (including, without
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72
limitation, any contingent or other amounts payable in respect of
letters of credit) that is to be repaid on the Effective Date
(including, without limitation, all Indebtedness under the Existing
Credit Agreement) shall have been (or shall be simultaneously) paid in
full, that any commitments to extend credit under the agreements or
instruments relating to such Indebtedness shall have been canceled or
terminated and that all Guarantees in respect of, and all Liens
securing, any such Indebtedness shall have been released (or
arrangements for such release satisfactory to the Administrative Agent
shall have been made).
(l) EVIDENCE OF APPROVALS. Evidence that all governmental and
third party approvals necessary or, in the discretion of the
Administrative Agent, advisable in connection with the Acquisition, the
financing contemplated hereby and the continuing operations of the
Borrower and its Subsidiaries shall have been obtained and be in full
force and effect, and all applicable waiting periods shall have expired
without any action being taken or threatened by any competent authority
which would restrain, prevent or otherwise impose adverse conditions on
the Acquisition or the financing thereof.
(m) CERTAIN FINANCIAL MATTERS. A certificate of a Senior Officer,
dated the Effective Date, setting forth the Total Debt Ratio as at the
Effective Date (calculated as of the Effective Date on a pro forma basis
determined so as to give effect to the Visual Action Acquisition and the
other transactions contemplated to occur on such date).
(n) FINANCIAL STATEMENTS. To the extent not previously delivered,
the financial statements of the Borrower referred to in Section 8.02
hereof.
(o) OTHER DOCUMENTS. Such other documents as the Administrative
Agent or any Lender or special New York counsel to Chase may reasonably
request.
The obligation of any Lender to make its initial extension of credit
hereunder is also subject to the payment by the Borrower of such fees as
the Borrower shall have agreed to pay to any Lender or the
Administrative Agent in connection herewith, including, without
limitation, the reasonable fees and expenses of Milbank, Tweed, Xxxxxx &
XxXxxx, special New York counsel to Chase, in connection with the
negotiation, preparation, execution and delivery of this Agreement and
the other Loan Documents and the extensions of credit hereunder (to the
extent that statements for such fees and expenses have been delivered to
the Borrower).
7.02 INITIAL AND SUBSEQUENT EXTENSIONS OF CREDIT. The
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73
obligation of the Lenders to make any Loan or otherwise extend credit to
the Borrower upon the occasion of each borrowing or other extension of
credit hereunder is subject to the further conditions precedent that,
both immediately prior to the making of such Loan or other extension of
credit and also after giving effect thereto and to the intended use
thereof:
(a) no Default shall have occurred and be continuing; and
(b) the representations and warranties made by the Borrower in
Section 8 hereof, and by each Obligor in each of the other Loan
Documents to which it is a party, shall be true and complete on and as
of the date of the making of such Loan or other extension of credit with
the same force and effect as if made on and as of such date (or, if any
such representation or warranty is expressly stated to have been made as
of a specific date (it being understood that references to "the date
hereof" are references to a specific date), as of such specific date).
Each notice of borrowing or request for the issuance of a Letter of
Credit by the Borrower hereunder shall constitute a certification by the
Borrower to the effect set forth in the preceding sentence (both as of
the date of such notice or request and, unless the Borrower otherwise
notifies the Administrative Agent prior to the date of such borrowing or
issuance, as of the date of such borrowing or issuance).
Section 8. REPRESENTATIONS AND WARRANTIES. The Borrower
represents and warrants to the Administrative Agent and the Lenders that:
8.01 EXISTENCE. Each of the Borrower and its Subsidiaries: (a)
is a corporation, partnership or other entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization; (b) has all requisite corporate or other power, and has
all material governmental licenses, authorizations, consents and
approvals necessary to own its assets and carry on its business as now
being or as proposed to be conducted; and (c) is qualified to do
business and is in good standing in all jurisdictions in which the
nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could reasonably be expected
(either individually or in the aggregate) to have a Material Adverse
Effect.
8.02 FINANCIAL CONDITION. The Borrower has heretofore furnished
to each of the Lenders the following financial statements:
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74
(i) consolidated balance sheets of the Borrower and its
Subsidiaries as at December 31, 1996 and the related consolidated
statements of income, retained earnings and cash flows of the
Borrower and its Subsidiaries for the fiscal year ended on said
date, with the opinion thereon of Ernst & Young LLP,
(ii) the unaudited consolidated balance sheets of the
Borrower and its Subsidiaries as at March 31, 1997 and the related
consolidated statements of income, retained earnings and cash flows
of the Borrower and its Subsidiaries for the three-month period
ended on such date,
(iii) pro forma consolidated balance sheets of the Borrower
and its Subsidiaries as at March 31, 1997, adjusted to give effect
to the consummation of the Acquisition and the financings
contemplated in connection therewith as if such transactions had
occurred as of such dates, and
(iv) projections of consolidated statements of income and
cash flows of the Borrower and its Subsidiaries through 2000, all
after giving effect to the Acquisition.
The financial statements described in clauses (i) and (ii) above are complete
and correct in all material respects and fairly present the consolidated
financial condition of the Borrower and its Subsidiaries or Xxxxxxxxx Group
and its Subsidiaries, as the case may be, and the consolidated results of
their respective operations for the fiscal year and three-month period ended
on said dates (subject, in the case of such financial statements as at March
31, 1997 to normal year-end audit adjustments), all in accordance with
generally accepted accounting principles and practices applied on a
consistent basis. The pro forma balance sheet referred to in clause (iii)
above reflects the proper application (based on reasonable estimates) of pro
forma adjustments after giving effect to the Acquisition. The projections
referred to in clause (iv) above are based on reasonable estimates.
None of the Borrower and its Subsidiaries has on the Effective Date
(after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date) any material contingent
liabilities, liabilities for taxes, unusual forward or long-term commitments
or unrealized or anticipated losses from any unfavorable commitments, except
as referred to or reflected or provided for in said balance sheets as at said
dates and except for liabilities with respect to the Visual Action
Acquisition as set forth in the Visual Action Acquisition Documents. Except
for the Visual Action Acquisition to be consummated on the Effective Date,
since December 31, 1996, there has been no material adverse change in the
consolidated
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75
financial condition, operations, business, assets, liabilities or prospects
taken as a whole of the Borrower and its Subsidiaries from that set forth in
(x) the financial statements referred to in clause (i) above as at said date
and (y) from and after the delivery thereof, the financial statements
referred to in Section 9.01(d) as at said date.
8.03 LITIGATION. Except as set forth in Schedule V hereto, there
are no legal or arbitral proceedings, or any proceedings by or before any
governmental or regulatory authority or agency, now pending or (to the
knowledge of the Borrower) threatened against the Borrower or any of its
Subsidiaries or that could reasonably be expected (either individually or in
the aggregate) to have a Material Adverse Effect, or that seek to enjoin or
otherwise challenge any of the transactions (including the Visual Action
Acquisition) contemplated by this Agreement.
8.04 NO BREACH. None of the execution and delivery of this
Agreement and the other Basic Documents, the consummation of the transactions
herein and therein contemplated or compliance with the terms and provisions
hereof and thereof will conflict with or result in a breach of, or require
any consent under the charter, partnership agreement or by-laws of any
Obligor, or any applicable law or regulation, or any order, writ, injunction
or decree of any court or governmental authority or agency, or any material
agreement or instrument to which the Borrower or any of its Subsidiaries is a
party or by which any of them or any of their Property is bound or to which
any of them is subject, or constitute a default under any such agreement or
instrument, or (except for the Liens created pursuant to the Security
Documents) result in the creation or imposition of any Lien upon any Property
of the Borrower or any of its Subsidiaries pursuant to the terms of any such
agreement or instrument.
8.05 ACTION. Each Obligor has all necessary partnership or
corporate power, authority and legal right to execute, deliver and perform
its obligations under each of the Basic Documents to which it is a party; the
execution, delivery and performance by each Obligor of each of the Basic
Documents to which it is a party have been duly authorized by all necessary
partnership or corporate action on its part (including, without limitation,
any required partner or shareholder approvals); and this Agreement has been
duly and validly executed and delivered by each Obligor and constitutes, and
the other Basic Documents to which it is a party when executed and delivered
by such Obligor will constitute, its legal, valid and binding obligation,
enforceable against each Obligor in accordance with its terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement
of creditors' rights and (b) the application of general principles of equity
(regardless
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76
of whether such enforceability is considered in a proceeding in equity or at
law).
8.06 APPROVALS. No authorizations, approvals or consents of, and
no filings or registrations with, any governmental or regulatory authority or
agency, or any securities exchange, are necessary for the execution, delivery
or performance by any Obligor of this Agreement or any of the other Basic
Documents to which it is a party or for the legality, validity or
enforceability hereof or thereof, except for filings, recordings and
registrations in respect of the Liens created pursuant to the Security
Documents.
8.07 USE OF CREDIT. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose, whether immediate,
incidental or ultimate, of buying or carrying Margin Stock, and no part of
the proceeds of any Loan hereunder will be used to buy or carry any Margin
Stock.
8.08 ERISA. Each Plan, and, to the knowledge of the Borrower,
each Multiemployer Plan, is in compliance with, and has been administered in
compliance with, the applicable provisions of ERISA, the Code and any other
Federal or State law except where failure to so comply could not reasonably
be expected to have a Material Adverse Effect, and no event or condition has
occurred and is continuing as to which the Borrower would be under an
obligation to furnish a report to the Lenders under Section 9.01(f) hereof
which could reasonably be likely to lead to liabilities in excess of $500,000.
8.09 TAXES. Except as set forth in Schedule VI hereto, the
Borrower and its Subsidiaries have filed all Federal income tax returns and
all other material tax returns that are required to be filed by them and have
paid all taxes due pursuant to such returns or pursuant to any assessment
received by the Borrower or any of its Subsidiaries. The charges, accruals
and reserves on the books of the Borrower and its Subsidiaries in respect of
taxes and other governmental charges are, in the opinion of the Borrower,
adequate.
8.10 INVESTMENT COMPANY ACT. Neither the Borrower nor any of its
Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of
1940, as amended.
8.11 PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Borrower nor
any of its Subsidiaries is a "holding company", or an "affiliate" of a
"holding company" or a "subsidiary company" of a "holding company", within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
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8.12 MATERIAL AGREEMENTS AND LIENS.
(a) Part A of Schedule II hereto is a complete and correct list of
each credit agreement, loan agreement, indenture, agreement for purchase of
Property or services, guarantee, letter of credit or other arrangement
providing for or otherwise relating to any Indebtedness or any extension of
credit (or commitment for any extension of credit) to, or guarantee by, the
Borrower or any of its Subsidiaries outstanding on the Effective Date (after
giving effect to the Visual Action Acquisition and the other transactions
contemplated to occur on such date) as to which (in the case of any such
arrangement) the aggregate principal or face amount equals or exceeds (or may
equal or exceed) $500,000, and the aggregate principal or face amount
outstanding or that may become outstanding under each such arrangement is
correctly described in Part A of said Schedule II.
(b) Part B of Schedule II hereto is a complete and correct list of
each Lien securing Indebtedness of any Person outstanding on the Effective
Date (after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date) the aggregate principal or
face amount of which equals or exceeds (or may equal or exceed) $500,000 and
covering any Property of the Borrower or any of its Subsidiaries, and the
aggregate Indebtedness secured (or that may be secured) by each such Lien and
the Property covered by each such Lien is correctly described in Part B of
said Schedule II.
8.13 ENVIRONMENTAL MATTERS. Each of the Borrower and its
Subsidiaries has obtained all environmental, health and safety permits,
licenses and other authorizations required under all Environmental Laws to
carry on its business as now being or as proposed to be conducted, except to
the extent failure to have any such permit, license or authorization could
not reasonably be expected (either individually or in the aggregate) to have
a Material Adverse Effect. Each of such permits, licenses and authorizations
is in full force and effect and each of the Borrower and its Subsidiaries is
in compliance with the terms and conditions thereof, and is also in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained
in any applicable Environmental Law or in any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder, except to the extent failure to comply
therewith could not reasonably be expected (either individually or in the
aggregate) to have a Material Adverse Effect. Except as set forth on
Schedule VII hereto, no notice, notification, demand, request for
information, citation, summons or order has been issued, no complaint has
been filed, no penalty has been assessed and no
CREDIT AGREEMENT
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investigation or review is pending or (to the knowledge of the Borrower)
threatened by any governmental or other entity with respect to any alleged
failure by the Borrower or any of its Subsidiaries to have any environmental,
health or safety permit, license or other authorization required under any
Environmental Law in connection with the conduct of the business of the
Borrower or any of its Subsidiaries or with respect to any generation,
treatment, storage, recycling, transportation, discharge or disposal, or any
Release of any Hazardous Materials generated by the Borrower or any of its
Subsidiaries, in each case which could reasonably be expected to lead to
fines, penalties or liabilities in excess of $500,000. All environmental
investigations, studies, audits, tests, reviews or other analyses conducted
by or that are in the possession of the Borrower or any of its Subsidiaries
in relation to facts, circumstances or conditions at or affecting any site or
facility now or previously owned, operated or leased by the Borrower or any
of its Subsidiaries and that could reasonably be expected to have a Material
Adverse Effect have been made available to the Administrative Agent.
8.14 CAPITALIZATION. As of the Effective Date (after giving
effect to the Visual Action Acquisition and the other transactions
contemplated to occur on such date), (i) there are no outstanding Equity
Rights with respect to the Borrower except as set forth on Schedule IV hereto
and (ii) there are no outstanding obligations of the Borrower or any of its
Subsidiaries to repurchase, redeem, or otherwise acquire any partnership
interest, shares of capital stock or other ownership interests of the
Borrower nor are there any outstanding obligations of the Borrower or any of
its Subsidiaries to make payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference to the fair
market value or equity value of the Borrower or any of its Subsidiaries.
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8.15 SUBSIDIARIES, ETC.
(a) Set forth in Part A of Schedule III hereto is a complete and
correct list of all of the Subsidiaries of the Borrower as of the date of the
Effective Date (after giving effect to the Visual Action Acquisition and the
other transactions contemplated to occur on such date), together with, for
each such Subsidiary, (i) the jurisdiction of organization of such
Subsidiary, (ii) each Person holding ownership interests in such Subsidiary
and (iii) the nature of the ownership interests held by each such Person and
the percentage of ownership of such Subsidiary represented by such ownership
interests. Except as disclosed in Part A of Schedule III hereto, (x) each of
the Borrower and its Subsidiaries owns, free and clear of Liens (other than
Liens created pursuant to the Security Documents), and has the unencumbered
right to vote, all outstanding ownership interests in each Person shown to be
held by it in Part A of Schedule III hereto, (y) all of the issued and
outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (z) there are no outstanding
Equity Rights with respect to such Person.
(b) Set forth in Part B of Schedule III hereto is a complete and
correct list of all Investments (other than Investments disclosed in Part A
of said Schedule III hereto and other than Investments of the type referred
to in clauses (b), (c), (d) or (e) of Section 9.08 hereof) held by the
Borrower or any of its Subsidiaries in any Person on the Effective Date
(after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date) and, for each such
Investment, (x) the identity of the Person or Persons holding such Investment
and (y) the nature of such Investment. Except as disclosed in Part B of
Schedule III hereto, each of the Borrower and its Subsidiaries owns, free and
clear of all Liens (other than Liens created pursuant to the Security
Documents), all such Investments.
(c) None of the Subsidiaries of the Borrower is, on the Effective
Date (after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date), subject to any indenture,
agreement, instrument or other arrangement of the type described in Section
9.15(c) hereof. As of the Effective Date (after giving effect to the Visual
Action Acquisition and the other transactions contemplated to occur on such
date), (i) Panavision U.K. L.P. does not engage in any activity, or own or
hold any Property or assets, other than (x) the ownership of the capital
shares of Panavision Luxembourg and (y) the making of loans to Panavision
Luxembourg in an aggregate principal amount not exceeding L18,091,000 and
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(ii) Panavision Luxembourg does not engage in any activity, or own any
Property or assets, other than the making of a loan to Panavision Europe in
an aggregate principal amount not exceeding L18,091,000 and the holding of a
promissory note representing such loan.
8.16 TITLE TO ASSETS. The Borrower owns and has on the Effective
Date (after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date) good and marketable title
(subject only to Liens permitted by Section 9.06 hereof) to the material
Properties shown to be owned in the most recent financial statements referred
to in Section 8.02 hereof (other than Properties disposed of in the ordinary
course of business or otherwise permitted to be disposed of pursuant to
Section 9.05 hereof). The Borrower owns and has on the Effective Date (after
giving effect to the Visual Action Acquisition and the other transactions
contemplated to occur on such date) good and marketable title to, and enjoys
on the Effective Date peaceful and undisturbed possession of, all material
Properties (subject only to Liens permitted by Section 9.06 hereof) that are
necessary for the operation and conduct of its businesses.
8.17 TRUE AND COMPLETE DISCLOSURE. The information, reports,
financial statements, exhibits and schedules (including, without limitation,
the Information Memorandum) furnished in writing by or on behalf of the
Obligors to the Administrative Agent or any Lender in connection with the
negotiation, preparation or delivery of this Agreement and the other Basic
Documents or included herein or therein or delivered pursuant hereto or
thereto, when taken as a whole do not contain any untrue statement of
material fact or omit to state any material fact necessary to make the
statements herein or therein, in light of the circumstances under which they
were made, not misleading. All written information furnished after the
Effective Date by the Borrower and its Subsidiaries to the Administrative
Agent and the Lenders in connection with this Agreement and the other Basic
Documents and the transactions contemplated hereby and thereby (including,
without limitation, any information memorandum prepared in connection with
the primary syndication of this Agreement to the Lenders other than Chase)
will be true, complete and accurate in every material respect, or (in the
case of projections) based on reasonable estimates, on the date as of which
such information is stated or certified. There is no fact known to the
Borrower that could have a Material Adverse Effect that has not been
disclosed herein, in the other Loan Documents or in a report, financial
statement, exhibit, schedule, disclosure letter or other writing furnished to
the Lenders for use in connection with the transactions contemplated hereby
or thereby.
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Section 9. COVENANTS OF THE BORROWER. The Borrower covenants and
agrees with the Lenders and the Administrative Agent that, so long as any
Commitment, Loan or Letter of Credit Liability is outstanding and until
payment in full of all amounts payable by the Borrower hereunder:
9.01 FINANCIAL STATEMENTS ETC. The Borrower shall deliver to the
Administrative Agent, together with copies for each of the Lenders (which
copies the Administrative Agent shall promptly forward to the Lenders):
(a) as soon as available and in any event within 45 days after the
end of each calendar monthly period (other than the month of December),
consolidated statements of income, retained earnings and cash flows of
the Borrower and its Subsidiaries for such period and for the period
from the beginning of the respective fiscal year to the end of such
period, and the related consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such period, setting forth in each
case in comparative form the corresponding consolidated figures for the
corresponding periods in the preceding fiscal year;
(b) as soon as available and in any event within 45 days after the
end of each of the first three quarterly fiscal periods of each fiscal
year of the Borrower, consolidated statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries for such
period and for the period from the beginning of the respective fiscal
year to the end of such period, and the related consolidated balance
sheets of the Borrower and its Subsidiaries as at the end of such
period, setting forth in each case in comparative form the corresponding
consolidated figures for the corresponding periods in the preceding
fiscal year (except that, in the case of balance sheets, such comparison
shall be to the last day of the prior fiscal year), accompanied by a
certificate of a Senior Officer, which certificate shall state (i) that
said consolidated financial statements fairly present the consolidated
financial condition and results of operations of the Borrower and its
Subsidiaries in accordance with generally accepted accounting
principles, consistently applied, as at the end of, and for, such period
(subject to normal year-end audit adjustments) and (ii) the amount of
any Restricted Payment paid during such period as permitted pursuant to
Section 9.09 hereof;
(c) as soon as available and in any event within 90 days after the
end of each fiscal year of the Borrower,
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consolidated statements of income, retained earnings and cash flows of
the Borrower and its Subsidiaries for such fiscal year and the related
consolidated balance sheets of the Borrower and its Subsidiaries as at
the end of such fiscal year, setting forth in each case in comparative
form the corresponding consolidated figures for the preceding fiscal
year, and accompanied by an opinion thereon of independent certified
public accountants of recognized national standing, which opinion shall
state that said consolidated financial statements fairly present the
consolidated financial condition and results of operations of the
Borrower and its Subsidiaries as at the end of, and for, such fiscal
year in accordance with generally accepted accounting principles, and a
statement of such accountants to the effect that, in making the
examination necessary for their opinion, nothing came to their attention
that caused them to believe that the Borrower was not in compliance with
Section 9.10 hereof, insofar as such Section relates to accounting
matters;
(d) as soon as possible and in any event within 60 days after the
Effective Date, the consolidated balance sheets of Xxxxxxxxx Group and
its Subsidiaries as at December 31, 1996 and the related consolidated
statements of profit and loss and cash flows of Xxxxxxxxx Group and its
Subsidiaries for the fiscal year ended on said date, with the opinion
thereon of Coopers & Xxxxxxx, together with a certificate of a Senior
Officer to the effect that, to the best of such Senior Officer's
knowledge, such financial statements are complete and correct in all
material respects and fairly present the consolidated financial
condition of Xxxxxxxxx Group and its Subsidiaries and the consolidated
results of their operations for the fiscal year ended on said date, all
in accordance with generally accepted accounting principles and
practices applied on a consistent basis;
(e) promptly upon their becoming available, copies of all
registration statements and regular periodic reports that the Borrower
shall have filed with the Securities and Exchange Commission (or any
governmental agency substituted therefor) or any national securities
exchange;
(f) promptly upon the mailing thereof to the shareholders of the
Borrower generally or to holders of Subordinated Indebtedness generally,
copies of all financial statements, reports and proxy statements so
mailed, and promptly following the receipt thereof by the Borrower,
copies of any notices or demands made by any holder (or a trustee for
any holder) of any Subordinated Indebtedness to or upon the Borrower;
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(g) as soon as possible, and in any event within 20 Business Days
after the Borrower knows that any of the events or conditions specified
below with respect to any Plan or Multiemployer Plan has occurred or
exists, a statement signed by a Senior Officer setting forth details
respecting such event or condition and the action, if any, that the
Borrower or its ERISA Affiliate proposes to take with respect thereto
(and a copy of any report or notice required to be filed with or given
to the PBGC by the Borrower or an ERISA Affiliate with respect to such
event or condition):
(i) any reportable event, as defined in Section 4043(c) of
ERISA and the regulations issued thereunder, with respect to a
Plan, as to which the PBGC has not by regulation waived the notice
requirement of Section 4043(a) of ERISA (PROVIDED that a failure to
meet the minimum funding standard of Section 412 of the Code or
Section 302 of ERISA, including, without limitation, the failure to
make on or before its due date a required installment under Section
412(m) of the Code or Section 302(e) of ERISA, shall be a
reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code); and any request for a
waiver under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of ERISA of a notice
of intent to terminate any Plan or any action taken by the Borrower
or an ERISA Affiliate to terminate any Plan, in each case other
than in a standard termination;
(iii) the institution by the PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the appointment of
a trustee to administer, any Plan, or the receipt by the Borrower
or any ERISA Affiliate of a notice from a Multiemployer Plan that
such action has been taken by the PBGC with respect to such
Multiemployer Plan;
(iv) the complete or partial withdrawal from a Multiemployer
Plan by the Borrower or any ERISA Affiliate that results in
liability under Section 4201 or 4204 of ERISA (including the
obligation to satisfy secondary liability as a result of a
purchaser default) or the receipt by the Borrower or any ERISA
Affiliate of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of
ERISA or that it intends to terminate or has
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terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against the Borrower or any ERISA Affiliate to
enforce Section 515 of ERISA, which proceeding is not dismissed
within 30 days; and
(vi) the adoption of an amendment to any Plan that, pursuant
to Section 401(a)(29) of the Code or Section 307 of ERISA, would
result in the loss of tax-exempt status of the trust of which such
Plan is a part if the Borrower or an ERISA Affiliate fails to
timely provide security to the Plan in accordance with the
provisions of said Sections;
(h) promptly after the Borrower knows or has reason to believe
that any Default has occurred, a notice of such Default describing the
same in reasonable detail and, together with such notice or as soon
thereafter as possible, a description of the action that the Borrower
has taken or proposes to take with respect thereto;
(i) promptly upon becoming available for each fiscal year (but not
later than 15 days after the beginning of each fiscal year), an annual
budget of the Borrower and its Subsidiaries for such fiscal year,
containing (i) a forecast balance sheet, and statements of income and
cash flows, (ii) an explanation of assumptions used to arrive at such
forecasts and (iii) an estimate of the calculation of compliance with
the covenants set forth in Section 9.10 for the relevant forecast
period; and
(j) from time to time such other information regarding the
financial condition, operations, business or prospects of the Borrower
or any of its Subsidiaries (including, without limitation, any Plan or
Multiemployer Plan and any reports or other information required to be
filed under ERISA) or Affiliates as any Lender or the Administrative
Agent may reasonably request.
The Borrower will furnish to the Administrative Agent, together with copies
for each of the Lenders (which copies the Administrative Agent shall promptly
forward to the Lenders), at the time it furnishes each set of financial
statements pursuant to Section 9.01(b) or 9.01(c) hereof, a certificate of a
Senior Officer (i) to the effect that no Default has occurred and is
continuing (or, if any Default has occurred and is continuing, describing the
same in reasonable detail and describing the action that the Borrower has
taken or proposes to take with respect thereto) and (ii) setting forth in
reasonable detail the
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computations necessary to determine whether the Borrower is in compliance
with Sections 9.07(e), 9.08(f), 9.09(a), 9.09(b), 9.09(c) and 9.10 hereof as
of the end of the respective monthly accounting period, quarterly fiscal
period or fiscal year.
9.02 LITIGATION.
(a) The Borrower will promptly give to the Administrative Agent,
together with copies for each of the Lenders (which copies the Administrative
Agent shall promptly forward to the Lenders), notice of all legal or arbitral
proceedings, and of all proceedings by or before any governmental or
regulatory authority or agency, and any material development in respect of
such legal or other proceedings, affecting the Borrower or any of its
Subsidiaries, but only if such proceedings, if adversely determined, could
reasonably be expected (either individually or in the aggregate) to have a
Material Adverse Effect.
(b) Without limiting the generality of the obligations under
Section 9.02(a) hereof, the Borrower will give to the Administrative Agent,
together with copies for each Lender (which copies the Administrative Agent
shall promptly forward to the Lenders), notice of the assertion of any
environmental matter by any Person against, or with respect to the activities
of, the Borrower or any of its Subsidiaries and notice of any alleged
violation of or non-compliance with any Environmental Laws or any permits,
licenses or authorizations, but only if such environmental matter or alleged
violation, if adversely determined, could reasonably be expected (either
individually or in the aggregate) to have a Material Adverse Effect.
9.03 EXISTENCE, ETC. The Borrower will, and will cause each of
its Subsidiaries to:
(a) preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises (PROVIDED that
nothing in this Section 9.03 shall prohibit any transaction expressly
permitted under Section 9.05 hereof);
(b) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if
failure to comply with such requirements could reasonably be expected
(either individually or in the aggregate) to have a Material Adverse
Effect;
(c) pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any of
its Property prior to the
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86
date on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being contested in
good faith and by proper proceedings and against which adequate reserves
are being maintained;
(d) maintain all of its Properties used or useful in its business
in good working order and condition, ordinary wear and tear excepted;
(e) keep adequate records and books of account, in which complete
entries will be made in accordance with generally accepted accounting
principles consistently applied; and
(f) permit representatives of any Lender or the Administrative
Agent, during normal business hours and upon reasonable notice to the
Borrower, to examine, copy and make extracts from its books and records,
to inspect any of its Properties, and to discuss its business and
affairs with its officers, all to the extent reasonably requested by
such Lender or the Administrative Agent (as the case may be).
9.04 INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, maintain insurance with financially sound and reputable
insurance companies, and with respect to Property and risks of a character
usually maintained by corporations engaged in the same or similar business
similarly situated, against loss, damage and liability of the kinds and in
the amounts customarily maintained by such corporations, PROVIDED that in any
event the Borrower will maintain property damage insurance with respect to
the tangible personal and real property subject to the Liens of the Security
Documents in such amounts, and subject to such deductibles, as shall be
reasonably satisfactory to the Administrative Agent, and shall name the
Administrative Agent as loss payee under each policy of such insurance.
9.05 PROHIBITION OF FUNDAMENTAL CHANGES.
(a) MERGERS AND CONSOLIDATIONS. The Borrower will not, nor will
it permit any of its Subsidiaries to, enter into any transaction of
merger or consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution).
(b) ACQUISITIONS. The Borrower will not, nor will it permit any
of its Subsidiaries to, acquire any business or Property from, or
capital stock of, or be a party to any Acquisition of, any Person except
for:
(i) purchases of inventory and other Property to be
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87
sold or used in the ordinary course of business;
(ii) Investments permitted under Section 9.08 hereof;
(iii) Capital Expenditures;
(iv) the Visual Action Acquisition; and
(v) the Borrower and its Wholly Owned Subsidiaries may effect
any Acquisition, so long as:
(A) the aggregate Purchase Price of all Acquisitions
shall not exceed $40,000,000 and the aggregate Purchase Price
of any individual Acquisition shall not exceed $15,000,000,
PROVIDED that the aggregate Purchase Price of all Acquisitions
of Persons which, after giving effect to such Acquisition, are
less than 80% owned by the Borrower and/or any of its Wholly
Owned Subsidiaries shall not exceed $20,000,000;
(B) each Acquired Entity shall engage in a line of
business (1) related to the manufacturing, sale, distribution
or rental of media and/or film equipment (or any line of
business substantially similar to the line(s) of business
conducted by the Borrower and its Subsidiaries on the
Effective Date) or (2) otherwise acceptable to the Majority
Lenders;
(C) such Acquisition (if by purchase of assets, merger
or consolidation) shall be effected in such manner so that the
relevant Acquired Entity (and the related assets) is owned by
the Borrower and/or any of its Subsidiaries and, if effected
by merger or consolidation involving the Borrower, the
Borrower shall be the continuing or surviving entity;
(D) such Acquisition (if by purchase of stock or other
ownership interests) shall be effected in such manner so that
the Acquired Entity becomes either a direct Subsidiary of the
Borrower or a direct Subsidiary of a direct Wholly Owned
Subsidiary of the Borrower;
(E) the Borrower shall deliver to the Administrative
Agent, no later than five Business Days prior to the
consummation of such Acquisition, a reasonably detailed
description of the material terms of such Acquisition
(including, without limitation, the business, assets or
Person, the Purchase Price thereof, the method and structure
of payment thereof and (if such Acquisition involves the
purchase of real
CREDIT AGREEMENT
88
Property) the estimated fair market value of such
Property);
(F) to the extent applicable, the Borrower shall have
complied (or made arrangements satisfactory to the
Administrative Agent to comply) with the provisions of
Sections 9.15 hereof, including, without limitation, delivery
to the Administrative Agent of the certificates evidencing the
capital stock or other ownership interests of any new
Subsidiary Acquired pursuant to such Acquisition, accompanied
by undated stock or other powers executed in blank;
(G) the sum, for the Acquired Entity and its
Subsidiaries, if any (determined on a consolidated basis
without duplication in accordance with GAAP), of (a) net
income for the period of four consecutive fiscal quarters
ending on or most recently prior to the date of such
Acquisition (calculated after eliminating extraordinary gains
and losses and unusual items) PLUS (b) income and other taxes
(to the extent deducted in determining net income for such
period) PLUS (c) depreciation and amortization and other
non-cash charges (to the extent deducted in determining net
income for such period) PLUS (d) the aggregate amount of
Interest Expense for such period MINUS (e) the aggregate
amount of interest income for such period PLUS (f) the
aggregate amount of upfront or one-time fees or expenses
payable in respect of Interest Rate Protection Agreements
during such period (to the extent deducted in determining net
income for such period) PLUS (g) the amount of unrealized
foreign exchange losses (net of any gains) (or MINUS the
amount of unrealized foreign exchange gains (net of any
losses)) PLUS (h) expenses, including excess compensation or
parachute payments, in connection with such Acquisition (to
the extent deducted in determining net income for such period)
MINUS (i) expenditures (including, without limitation, the
aggregate amount of assets capitalized under Capital Lease
Obligations incurred during such period computed in accordance
with GAAP) made by the Acquired Entity or any of its
Subsidiaries to acquire or construct fixed assets, plant and
equipment (including renewals, improvements and replacements,
but excluding repairs) during such period computed in
accordance with GAAP shall exceed zero;
(H) immediately prior to such Acquisition and after
giving effect thereto, no Default shall have occurred or be
continuing;
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89
(I) after giving effect to such Acquisition the Borrower
shall be in compliance with Section 9.10 hereof (the
determination of such compliance to be calculated on a pro
forma basis, as at the end of and for the period of four
fiscal quarters most recently ended prior to the date of such
Acquisition for which financial statements of the Borrower and
its Subsidiaries are available, under the assumption that such
Acquisition shall have been made or consummated, and any
Indebtedness in connection therewith shall have been incurred,
at the beginning of the applicable period, and under the
assumption that interest for such period had been equal to the
actual weighted average interest rate in effect for the Loans
hereunder on the date of such Acquisition); and
(J) on or prior to the date of the consummation of such
Acquisition, the Borrower shall have delivered to the
Administrative Agent a certificate of a Senior Officer showing
the calculations in reasonable detail to demonstrate
compliance with the requirements of clauses (G) and (I) above
and certifying as to clause (H) above.
In addition, but not as a condition precedent to any Acquisition,
the Borrower shall deliver to the Administrative Agent promptly
following the consummation of each Acquisition, a copy of the
relevant fully executed acquisition agreement (including schedules
and exhibits thereto).
(c) DISPOSITIONS. The Borrower will not, nor will it permit any
of its Subsidiaries to, convey, sell, lease, transfer or otherwise
dispose of, in one transaction or a series of transactions, any part of
its business or Property, whether now owned or hereafter acquired
(including, without limitation, receivables and leasehold interests, but
excluding:
(i) Excluded Dispositions; and
(ii) additional Dispositions having a market value not
exceeding $3,000,000 during any fiscal year or $6,000,000 in the
aggregate for all such Dispositions.
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90
(d) CERTAIN EXCLUSIONS. Notwithstanding the foregoing provisions
of this Section 9.05:
(i) any Wholly Owned Subsidiary of the Borrower may be merged
or consolidated with or into: (x) the Borrower if the Borrower
shall be the continuing or surviving corporation or (y) any other
Wholly Owned Subsidiary of the Borrower;
(ii) any Wholly Owned Subsidiary of the Borrower may sell,
lease, transfer or otherwise dispose of any or all of its Property
(upon voluntary liquidation or otherwise) to the Borrower or
another Wholly Owned Subsidiary of the Borrower (other than
Panavision U.K. L.P. or Panavision Luxembourg); and
(iii) the Borrower may cause Panavision Italia S.rl. to be
liquidated.
9.06 LIMITATION ON LIENS. The Borrower will not, nor will it
permit any of its Subsidiaries to, create, incur, assume or suffer to exist
any Lien upon any of its Property, whether now owned or hereafter acquired,
except:
(a) Liens created pursuant to the Security Documents;
(b) Liens in existence on the Effective Date (after giving effect
to the Visual Action Acquisition and the other transactions contemplated
to occur on such date) and listed in Part B of Schedule II hereto
(excluding, however, following the making of any Loans to be made
hereunder on the Effective Date, Liens securing Indebtedness to be
repaid with the proceeds of such Loans, as indicated on said Schedule
II);
(c) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or that are being contested in good
faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Borrower or the affected
Subsidiaries, as the case may be, in accordance with GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business that are not overdue for a period of more than 30 days or that
are being contested in good faith and by appropriate proceedings and
Liens securing judgments but only to the extent for an amount and for a
period not resulting in an Event of Default under Section 10(h) hereof;
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91
(e) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(f) deposits to secure the performance of bids, trade contracts
(other than for Indebtedness), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of Property or minor imperfections in title
thereto that, in the aggregate, are not material in amount, and that do
not in any case materially detract from the value of the Property
subject thereto or interfere with the ordinary conduct of the business
of the Borrower or any of its Subsidiaries; and
(h) Liens upon real and/or tangible personal Property acquired
after the Effective Date (by purchase, construction or otherwise) by the
Borrower or any of its Subsidiaries, each of which Liens secures
Indebtedness under Section 9.07(e) hereof and which Liens either (A)
existed on such Property before the time of its acquisition and was not
created in anticipation thereof or (B) was created solely for the
purpose of securing Indebtedness representing, or incurred to finance,
refinance or refund, the cost (including the cost of construction) of
such Property; PROVIDED that no such Lien shall extend to or cover any
Property of the Borrower or such Subsidiary other than the Property so
acquired and improvements thereon.
9.07 INDEBTEDNESS. The Borrower will not, nor will it permit any
of its Subsidiaries to, create, incur or suffer to exist any Indebtedness
except:
(a) Indebtedness to the Lenders hereunder, including, without
limitation, Incremental Term Loans, in an aggregate principal amount up
to but not exceeding $50,000,000;
(b) Indebtedness outstanding on the Effective Date (after giving
effect to the Visual Action Acquisition and the other transactions
contemplated to occur on such date) and listed in Part A of Schedule II
hereto;
(c) Subordinated Indebtedness incurred after the Effective Date in
accordance with Section 9.11(a) hereof;
(d) Indebtedness of Subsidiaries of the Borrower to
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the Borrower or to other Subsidiaries of the Borrower, and
Indebtedness of the Borrower to any Subsidiary of the Borrower; and
(e) additional Indebtedness of the Borrower and its Subsidiaries
(including, without limitation, Capital Lease Obligations and other
Indebtedness secured by Liens permitted under Sections 9.06(h) hereof)
up to but not exceeding $12,000,000 at any one time outstanding.
9.08 INVESTMENTS. The Borrower will not, nor will it permit any
of its Subsidiaries to, make or permit to remain outstanding any Investments
except:
(a) Investments outstanding on the Effective Date (after giving
effect to the Visual Action Acquisition and the other transactions
contemplated to occur on such date), as identified in Part B of Schedule
III hereto;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) Investments by the Borrower and its Subsidiaries in the
Borrower and its Subsidiaries;
(e) Interest Rate Protection Agreement not entered into for
speculative purposes;
(f) advances, loans or extensions of credit arising in connection
with the sale of inventory or supplies, or the provision of services, by
the Borrower or any of its Subsidiaries in the ordinary course of
business having a term not exceeding 180 days for the Borrower or any of
its Subsidiaries (other than Foreign Subsidiaries) or 360 days for any
Foreign Subsidiary;
(g) loans to directors, officers, employees or agents up to but
not exceeding $1,500,000 in the aggregate at any one time outstanding;
(h) Investments made as a result of the receipt of non-cash
consideration from a Disposition permitted under Section 9.05(c) hereof,
up to but not exceeding $1,000,000 (with respect to the fair market
value of such non-cash consideration) in the aggregate at any one time
outstanding;
(i) Investments in dealers and customers received in connection
with any bankruptcy or reorganization of such Person as a result of an
Investment otherwise permitted hereunder;
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93
(j) Investments comprised of progress payments to suppliers up to
but not exceeding $1,000,000 in the aggregate at any one time
outstanding;
(k) additional Investments (other than any Investments permitted
under any of the foregoing clauses, but excluding any Investments
permitted under clause (l) below) of up to but not exceeding $4,000,000
in the aggregate during any fiscal year, PROVIDED that in no event shall
the aggregate amount of all such Investments exceed $6,000,000; and
(l) Acquisitions permitted under Section 9.05(b)(iv) hereof.
9.09 RESTRICTED PAYMENTS. The Borrower will not, nor will it
permit any of its Subsidiaries to, declare or make any Restricted Payment at
any time; PROVIDED that, so long as at the time thereof and after giving
effect thereto no Default shall have occurred and be continuing, the Borrower
may:
(a) if, as of the last day of any fiscal year of the Borrower
ending on or after December 31, 1996 (the "PRECEDING FISCAL YEAR"), the
Total Debt Ratio is less than 1.25 to 1, make Restricted Payments during
the succeeding fiscal year in an aggregate amount not exceeding the net
income of the Borrower and its Subsidiaries for such preceding fiscal
year PLUS an amount equal to any amount which could previously have been
paid under this clause (a) but which was not theretofore paid, PROVIDED
that the Borrower shall have delivered to the Administrative Agent, at
least 10 Business Days (but not more than 20 Business Days) prior to the
date of declaration of any such Restricted Payment, a certificate of a
Senior Officer setting forth computations in reasonable detail
demonstrating compliance with the requirements of this clause (a); and
(b) Panavision Canada Holdings may repurchase its shares held by
management from time to time, up to but not exceeding $3,000,000 in the
aggregate.
Nothing herein shall be deemed to prohibit the payment of dividends
by any Subsidiary of the Borrower to the Borrower or to any other Subsidiary
of the Borrower.
9.10 CERTAIN FINANCIAL COVENANTS.
(a) TOTAL DEBT RATIO. The Borrower will not permit the Total Debt
Ratio to exceed the following respective ratios at any time during the
following respective periods:
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94
Period Ratio
------ -----
From and including the
Effective Date to and
including December 30, 1997 2.50 to 1
From and including
December 31, 1997
to and including
March 30, 1998 2.25 to 1
From and including
March 31, 1998
to and including
September 29, 1998 2.00 to 1
From and including
September 30, 1998
to and including
March 30, 1999 1.75 to 1
From and including
March 31, 1999
to and including
September 29, 1999 1.50 to 1
From and including
September 30, 1999
and at all times
thereafter 1.25 to 1
(b) INTEREST COVERAGE RATIO. The Borrower will cause the Interest
Coverage Ratio to exceed the following respective ratios at the end of each
fiscal quarter during the following respective periods:
Period Ratio
------ -----
From and including the
Effective Date
to and including
December 30, 1998 4.5 to 1
From and including
December 31, 1998
and at all times
thereafter 6.0 to 1
(c) FIXED CHARGES RATIO. The Borrower will not permit
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95
the Fixed Charges Ratio to be less than 1.05 to 1 at the end of any fiscal
quarter.
(d) CAPITAL EXPENDITURES. The Borrower will not permit the
aggregate amount of Capital Expenditures in any fiscal year of the Borrower
(for purposes of this Section 9.10(d), the "CURRENT FISCAL YEAR") to exceed
the sum of (x) $48,000,000 PLUS an amount equal to 50% of Excess Cash Flow
for the preceding fiscal year. If the aggregate amount of Capital
Expenditures for the preceding fiscal year were less than the amount
permitted for such fiscal year in the preceding sentence, then the shortfall
shall be added to the amount of Capital Expenditures permitted for the
Current Fiscal Year (but not any other) and, for purposes hereof, the amount
of Capital Expenditures made during the Current Fiscal Year shall be deemed
to be made first from the amount of any carryover from the preceding fiscal
year.
9.11 SUBORDINATED INDEBTEDNESS.
(a) INCURRENCE. The Borrower may, at any time after the Effective
Date, incur additional Indebtedness so long as each of the following
conditions shall be satisfied:
(i) such additional Indebtedness is subordinated to the
obligations of the Borrower to pay principal of and interest on the
Loans and the other obligations hereunder and under the Loan
Documents on terms of subordination, and pursuant to documentation
containing other terms (including, without limitation, interest,
amortization, covenants and events of default), in each case in
form and substance reasonably satisfactory to the Majority Lenders;
(ii) the Net Available Proceeds of such Indebtedness are
applied to the prepayment of the Loans to the extent required by
Section 2.10(e) hereof; and
(iii) after giving effect to the incurrence of such
Indebtedness and the application of proceeds thereof, no Default
shall have occurred and be continuing.
Any Subsidiary Guarantor may Guarantee such Indebtedness so long as such
Guarantee is similarly subordinated to the Guarantee of such Subsidiary
Guarantor hereunder upon terms (including, without limitation, terms of
subordination) in form and substance reasonably satisfactory to the Majority
Lenders.
(b) PAYMENTS AND PREPAYMENTS. The Borrower will not, nor will it
permit any of its Subsidiaries to, purchase, redeem, retire or otherwise
acquire for value, or set apart any money for a sinking, defeasance or other
analogous fund for the purchase, redemption, retirement or other acquisition
of, or make any
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voluntary payment or prepayment of the principal of or interest on, or any
other amount owing in respect of, any Subordinated Indebtedness, except for
regularly scheduled payments or prepayments of principal and interest in
respect thereof required pursuant to the instruments evidencing such
Subordinated Indebtedness.
9.12 LINES OF BUSINESS. The Borrower will not, nor will it permit
any of its Subsidiaries to, engage in any line or lines of business activity
other than that related to the manufacturing, sale, distribution or rental of
media and/or film equipment or lines of business substantially similar to
that conducted by the Borrower and its Subsidiaries on the Effective Date
(after giving effect to the Visual Action Acquisition and the other
transactions contemplated to occur on such date).
9.13 TRANSACTIONS WITH AFFILIATES. Except as expressly permitted
by this Agreement, the Borrower will not, nor will it permit any of its
Subsidiaries to, directly or indirectly: (a) make any Investment in an
Affiliate; (b) transfer, sell, lease, assign or otherwise dispose of any
Property to an Affiliate; (c) merge into or consolidate with or purchase or
acquire Property from an Affiliate; or (d) enter into any other transaction
directly or indirectly with or for the benefit of an Affiliate (including,
without limitation, Guarantees and assumptions of obligations of an
Affiliate); PROVIDED that, notwithstanding the foregoing:
(i) any Affiliate who is an individual may serve as a director,
officer or employee of the Borrower or any of its Subsidiaries and
receive indemnification and reasonable compensation for his or her
services in such capacity;
(ii) the Borrower and its Subsidiaries may enter into transactions
(other than extensions of credit by the Borrower or any of its
Subsidiaries to an Affiliate) providing for the leasing of Property, the
rendering or receipt of services or the purchase or sale of inventory
and other Property in the ordinary course of business if the monetary or
business consideration arising therefrom would be substantially as
advantageous to the Borrower and its Subsidiaries as the monetary or
business consideration that would obtain in a comparable transaction
with a Person not an Affiliate; and
(iii) the Borrower and its Subsidiaries may make Permitted
Investments in the Warburg Pincus Cash Reserve Fund meeting the
requirements of the definition of "Permitted Investments" in Section
1.01 hereof.
9.14 USE OF PROCEEDS. The Borrower will use the
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proceeds of (i) the Tranche A Term Loans and the Revolving Credit Loans
made hereunder on the Effective Date to refinance the loans under the
Existing Credit Agreement, to finance the Visual Action Acquisition and to
pay fees and expenses incurred in connection with the Visual Action
Acquisition and this Agreement, (ii) the Revolving Credit Loans made
hereunder after the Effective Date to finance the ongoing working capital and
capital expenditure requirements of the Borrower and its Subsidiaries and to
provide funds for general corporate purposes of the Borrower and its
Subsidiaries and (iii) the Incremental Term Loans made hereunder for general
corporate purposes of the Borrower and its Subsidiaries (including, without
limitation, Acquisitions permitted under Section 9.05(b)(v)). The Borrower
will use such proceeds in compliance with all applicable legal and regulatory
requirements, including, without limitation, Regulations G, T, U and X and
the Securities Act of 1933 and the Securities Exchange Act of 1934 and the
regulations thereunder. Neither the Administrative Agent nor any Lender
shall have any responsibility as to the use of any of such proceeds.
9.15 CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES.
(a) SUBSIDIARY GUARANTORS. The Borrower will take such action,
and will cause each of its Subsidiaries to take such action, from time to
time as shall be necessary to ensure that all Subsidiaries of the Borrower
are "Subsidiary Guarantors" hereunder. Without limiting the generality of
the foregoing, in the event that the Borrower or any of its Subsidiaries
shall form or acquire any new entity that shall constitute a Subsidiary
hereunder, the Borrower and its Subsidiaries will cause such new Subsidiary
to:
(i) become a "Subsidiary Guarantor" hereunder, and a "Securing
Party" under the Security Agreement, pursuant to a Guarantee Assumption
Agreement;
(ii) cause such Subsidiary to take such action (including, without
limitation, delivering such shares of stock and executing and delivering
such Uniform Commercial Code financing statements) as shall be necessary
to create and perfect valid and enforceable first priority Liens on
substantially all of the Property of such new Subsidiary (other than
real Property and fixtures owned or leased by such Subsidiary) as
collateral security for the obligations of such new Subsidiary hereunder
(PROVIDED that any such security interests shall be subject to the
provisions of Section 5.04(c) of the Security Agreement and to any Liens
permitted under Section 9.06 hereof and existing at the time such entity
becomes a Subsidiary); and
(iii) deliver such proof of partnership or corporate
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action, incumbency of officers, opinions of counsel (subject to usual
and customary exceptions and assumptions) and other documents as is
consistent with those delivered by each Obligor pursuant to Section 7.01
hereof on the Effective Date or as the Administrative Agent shall have
requested;
PROVIDED that, if any such Subsidiary is organized as a corporation under the
laws of a jurisdiction other than the United States of America or a State
thereof (each a "FOREIGN SUBSIDIARY"), such Subsidiary shall not be required
to become a Subsidiary Guarantor hereunder or a Securing Party under the
Security Agreement and, if such Foreign Subsidiary is a direct Subsidiary of
the Borrower or a Subsidiary of the Borrower that is organized under the laws
of the United States of America or a State thereof, the Borrower shall
forthwith pledge, or cause to be pledged, to the Administrative Agent (for
the benefit of the Lenders) under the Security Agreement (or, at the request
of the Majority Lenders, under a pledge or other agreement governed by the
law of such Subsidiary's jurisdiction of organization) (x) 66% of the voting
capital stock of such Foreign Subsidiary having ordinary voting power for the
election of the board of directors of such Foreign Subsidiary and (y) 100% of
all other stock of such Foreign Subsidiary; and PROVIDED FURTHER that
Panavision U.K. L.P. shall not be required to become a Subsidiary Guarantor
hereunder.
(b) OWNERSHIP OF SUBSIDIARIES. The Borrower will, and will cause
each of its Subsidiaries to, take such action from time to time as shall be
necessary to ensure that each of its Subsidiaries formed or acquired after
the Effective Date is a Wholly Owned Subsidiary, except that with respect to
Subsidiaries formed or acquired pursuant to Section 9.05(b)(v) or 9.08(k)
hereof, such Subsidiaries shall not be required to be Wholly Owned
Subsidiaries. In the event that any additional shares of stock shall be
issued by any Subsidiary, the respective Obligor agrees forthwith to deliver
to the Administrative Agent pursuant to the Security Agreement the
certificates evidencing such shares of stock, accompanied by undated stock
powers executed in blank and to take such other action as the Administrative
Agent shall request to perfect the security interest created therein pursuant
to the Security Agreement.
(c) CERTAIN RESTRICTIONS. The Borrower will not permit any of its
Subsidiaries to enter into, after the Effective Date, any indenture,
agreement, instrument or other arrangement that, directly or indirectly,
prohibits or restrains, or has the effect of prohibiting or restraining, or
imposes materially adverse conditions upon, the incurrence or payment of
Indebtedness, the granting of Liens, the declaration or payment of dividends,
the making of loans, advances or Investments or the sale, assignment,
transfer or other disposition of Property;
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PROVIDED that the foregoing shall not prohibit (i) any customary
nonassignment provisions entered into in the ordinary course of business in
leases and other agreements, (ii) any restriction with respect to a
Subsidiary imposed pursuant to an agreement which has been entered into for
the sale or disposition of all or substantially all of the capital stock or
assets of such Subsidiary, PROVIDED that the consummation of such transaction
is otherwise permitted under this Agreement, (iii) any restriction pursuant
to applicable law or regulations, (iv) any restriction on the sale or other
disposition of Property securing Indebtedness as a result of a Lien on such
Property, and (v) any restriction contained in any instrument constituting
Indebtedness permitted under Section 9.07(e) hereof, PROVIDED that such
restrictions are consistent with, and not materially more restrictive (as
conclusively determined in good faith by a Senior Officer) than comparable
provisions included in this Agreement.
9.16 MODIFICATIONS OF CERTAIN DOCUMENTS. The Borrower will not,
nor will it permit any of its Subsidiaries to, consent to any modification,
supplement, or waiver of any of the provisions of any provision of its
respective charter or by-laws (or equivalent documents), if in each case such
modification, supplement or waiver could reasonably be expected to be adverse
to the interests of the Lenders under the Loan Documents, in each case
without the prior consent of the Majority Lenders; PROVIDED that, the
Borrower shall, in any event, notify the Administrative Agent in writing of
any proposed modification, supplement or waiver of any provision of any of
the foregoing agreements or documents at least ten Business Days prior to
proposed effective date of such modification, supplement or waiver.
Section 10. EVENTS OF DEFAULT. If one or more of the following
events (herein called "EVENTS OF DEFAULT") shall occur and be continuing:
(a) The Borrower shall default in the payment when due (whether at
stated maturity or at mandatory or optional prepayment) of (i) any
principal of any Loan or Reimbursement Obligation, (ii) any interest on
any Loan or Reimbursement Obligation or (iii) any fee or any other
amount payable by it hereunder or under any other Loan Document and, in
the case of any such default in the payment of any fee or other amount,
such default shall continue for two or more Business Days; or
(b) The Borrower or any of its Subsidiaries shall default in the
payment when due of any principal of or interest on any of its other
Indebtedness aggregating $5,000,000 or more; or any event specified in
any note, agreement, indenture or other document evidencing or
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relating to any such Indebtedness shall occur if the effect of such
event is to cause, or (with the giving of any notice or the lapse of
time or both) to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause, such
Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its
stated maturity; or any event specified in any Interest Rate Protection
Agreement to which any Obligor is a party shall occur if the effect of
such event is to cause, or (with the giving of any notice or the lapse
of time or both) to permit, termination or liquidation payment or
payments aggregating $5,000,000 or more to become due; or
(c) Any representation, warranty or certification made or deemed
made herein or in any other Loan Document (or in any modification or
supplement hereto or thereto) by any Obligor, or any certificate
furnished to any Lender or the Administrative Agent pursuant to the
provisions hereof or thereof, shall prove to have been false or
misleading as of the time made or furnished in any material respect; or
(d) Any of the following shall occur and be continuing: (i) the
Borrower shall default in the performance of any of its obligations
under any of Sections 9.05, 9.06, 9.07, 9.08, 9.09, 9.10, 9.11 or 9.16
hereof; (ii) any Obligor shall default in the performance of any of its
obligations under Section 5.02 of the Security Agreement; or (iii) any
Obligor shall default in the performance of any of its other obligations
in this Agreement or any other Loan Document and such default shall
continue unremedied for a period of 30 or more days after notice thereof
to the Borrower by the Administrative Agent or any Lender (through the
Administrative Agent); or
(e) The Borrower or any of its Significant Subsidiaries shall
admit in writing its inability to, or be generally unable to, pay its
debts as such debts become due; or
(f) The Borrower or any of its Significant Subsidiaries shall (i)
apply for or consent to the appointment of, or the taking of possession
by, a receiver, custodian, trustee, examiner or liquidator of itself or
of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a voluntary
case under the Bankruptcy Code or other applicable laws of similar
effect, (iv) file a petition seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization, liquidation,
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dissolution, arrangement or winding-up, or composition or readjustment
of debts, (v) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it in an involuntary
case under the Bankruptcy Code or other applicable laws of similar
effect or (vi) take any corporate action for the purpose of effecting
any of the foregoing; or
(g) A proceeding or case shall be commenced, without the
application or consent of the Borrower or any of its Significant
Subsidiaries, in any court of competent jurisdiction, seeking (i) its
reorganization, liquidation, dissolution, arrangement or winding-up, or
the composition or readjustment of its debts, (ii) the appointment of a
receiver, custodian, trustee, examiner, liquidator or the like of the
Borrower or such Significant Subsidiary or of all or any substantial
part of its Property, or (iii) similar relief in respect of the Borrower
or such Significant Subsidiary under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or adjustment of
debts, and such proceeding or case shall continue undismissed, or an
order, judgment or decree approving or ordering any of the foregoing
shall be entered and continue unstayed and in effect, for a period of 60
or more days; or an order for relief against the Borrower or any of its
Significant Subsidiaries shall be entered in an involuntary case under
the Bankruptcy Code or other applicable laws of similar effect; or
(h) A final judgment or judgments for the payment of money of
$5,000,000 or more in the aggregate (net of judgment amounts to the
extent covered by insurance or indemnity where the insurer or
indemnitor, as the case may be, has admitted liability in respect of
such judgment) shall be rendered by one or more courts, administrative
tribunals or other bodies having jurisdiction against the Borrower or
any of its Significant Subsidiaries and the same shall not be discharged
(or provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 45 days from the date of
entry thereof and the Borrower or the relevant Subsidiary shall not,
within said period of 45 days, or such longer period during which
execution of the same shall have been stayed, appeal therefrom and cause
the execution thereof to be stayed during such appeal; or
(i) An event or condition specified in Section 9.01(f) hereof
shall occur or exist with respect to any Plan or Multiemployer Plan and,
as a result of such event or condition, together with all other such
events or conditions, the Borrower or any ERISA Affiliate shall incur
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or, in the opinion of the Majority Lenders, shall be reasonably likely
to incur a liability to a Plan, a Multiemployer Plan or the PBGC (or any
combination of the foregoing) that, in the determination of the Majority
Lenders, would (either individually or in the aggregate) have a Material
Adverse Effect; or
(j) There shall have been asserted against the Borrower or any of
its Subsidiaries, or any predecessor in interest of the Borrower or any
of its Subsidiaries or Affiliates, of (or there shall have been asserted
against the Borrower or any of its Subsidiaries) any claims or
liabilities, whether accrued, absolute or contingent, based on or
arising from the generation, storage, transport, handling or disposal of
Hazardous Materials by the Borrower or any of its Subsidiaries,
Affiliates or predecessors that, in the reasonable judgment of the
Majority Lenders, are reasonably likely to be determined adversely to
the Borrower or any of its Subsidiaries, and the amount thereof (either
individually or in the aggregate) is reasonably likely to have a
Material Adverse Effect (insofar as such amount is payable by the
Borrower or any of its Subsidiaries but after deducting any portion
thereof that is reasonably expected to be paid by other creditworthy
Persons jointly and severally liable therefor); or
(k) Any of the following events shall occur and be continuing:
(i) any person or group (within the meaning of Rule 13d-5
under the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT") and Section 13(d) and 14(d) of the Exchange Act
(other than Warburg Pincus and the Warburg Affiliates) becomes,
directly or indirectly, in a single transaction or in a related
series of transactions by way of merger, consolidation or other
business combination or otherwise, the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act) of more than 35% (or
such higher percentage as shall be owned at such time by Warburg
Pincus and/or the Warburg Affiliates) of the capital stock of the
Borrower on a fully-diluted basis (in other words, giving effect to
the exercise of any warrants, options and conversion and other
rights); or
(ii) a majority of the Board of Directors of the Borrower
shall no longer be composed of individuals (x) who are members of
said Board on the Effective Date, (y) whose election or nomination
to said Board has been approved by individuals referred to in the
foregoing clause (x) constituting at the time of such election or
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nomination at least a majority of said Board or (z) whose election
or nomination to said Board was approved by individuals referred to
in the foregoing clauses (x) and (y) constituting at the time of
such election or nomination at least a majority of said Board; or
(l) The Liens created by the Security Documents shall at any time
not (other than by reason of the action of the Administrative Agent or
any of the Lenders) constitute a valid and perfected Lien on the
collateral intended to be covered thereby (to the extent perfection by
filing, registration, recordation or possession is required herein or
therein) in favor of the Administrative Agent, free and clear of all
other Liens (other than Liens permitted under Section 9.06 hereof or
under the respective Security Documents), or, except for expiration in
accordance with its terms, any of the Security Documents shall for
whatever reason be terminated or cease to be in full force and effect,
or any Subsidiary Guarantor shall contest the enforceability of its
obligations hereunder;
THEREUPON:
(1) in the case of an Event of Default other than one referred to
in clause (f) or (g) of this Section 10 with respect to any Obligor, the
Administrative Agent may, (and, upon the direction of the Majority
Lenders, shall) by notice to the Borrower, terminate the Commitments
and/or declare the principal amount then outstanding of, and the accrued
interest on, the Loans, the Reimbursement Obligations and all other
amounts payable by the Obligors hereunder (including, without
limitation, any amounts payable under Section 5.05 or 5.06 hereof) to be
forthwith due and payable, whereupon such amounts shall be immediately
due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by
each Obligor; and
(2) in the case of the occurrence of an Event of Default referred
to in clause (f) or (g) of this Section 10 with respect to any Obligor,
the Commitments shall automatically be terminated and the principal
amount then outstanding of, and the accrued interest on, the Loans, the
Reimbursement Obligations and all other amounts payable by the Obligors
hereunder (including, without limitation, any amounts payable under
Section 5.05 or 5.06 hereof) shall automatically become immediately due
and payable without presentment, demand, protest or other formalities of
any kind, all of which are hereby expressly waived by each Obligor.
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In addition, upon the occurrence and during the continuance of any
Event of Default (if the Administrative Agent has declared the principal
amount then outstanding of, and accrued interest on, the Revolving Credit
Loans and all other amounts payable by the Borrower hereunder to be due and
payable), the Borrower agrees that it shall, if requested by the
Administrative Agent or the Majority Revolving Credit Lenders through the
Administrative Agent (and, in the case of any Event of Default referred to in
clause (f) or (g) of this Section 10 with respect to the Borrower, forthwith,
without any demand or the taking of any other action by the Administrative
Agent or such Lenders) provide cover for the Letter of Credit Liabilities by
paying to the Administrative Agent immediately available funds in an amount
equal to the then aggregate undrawn face amount of all Letters of Credit,
which funds shall be held by the Administrative Agent in the Collateral
Account as collateral security in the first instance for the Letter of Credit
Liabilities and be subject to withdrawal only as therein provided.
Section 11. THE ADMINISTRATIVE AGENT.
11.01 APPOINTMENT, POWERS AND IMMUNITIES. Each Lender hereby
appoints and authorizes the Administrative Agent to act as its agent
hereunder and under the other Loan Documents (and specifically as agent under
the New Zealand Pledge Agreement and the U.K. Pledge Agreement) with such
powers as are specifically delegated to the Administrative Agent by the terms
of this Agreement and of the other Loan Documents, together with such other
powers as are reasonably incidental thereto. The Administrative Agent (which
term as used in this sentence and in Section 11.05 hereof and the first
sentence of Section 11.06 hereof shall include reference to its affiliates
and its own and its affiliates' officers, directors, employees and agents):
(a) shall have no duties or responsibilities except those
expressly set forth in this Agreement and in the other Loan Documents,
and shall not by reason of this Agreement or any other Loan Document be
a trustee for any Lender;
(b) shall not be responsible to the Lenders for any recitals,
statements, representations or warranties contained in this Agreement or
in any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any of them under, this
Agreement or any other Loan Document, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or any other document referred to
or provided for herein or therein or for any failure by the Borrower or
any other
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Person to perform any of its obligations hereunder or thereunder;
(c) shall not, except to the extent expressly instructed by the
Majority Lenders with respect to collateral security under the Security
Documents, be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document; and
(d) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under any other Loan Document or under any
other document or instrument referred to or provided for herein or
therein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct.
The Administrative Agent may employ agents and attorneys-in-fact and shall
not be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith.
11.02 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent
shall be entitled to rely upon any certification, notice or other
communication (including, without limitation, any thereof by telephone,
telecopy, telegram or cable) reasonably believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person
or Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent. As to
any matters not expressly provided for by this Agreement or any other Loan
Document, the Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder or thereunder in accordance
with instructions given by the Majority Lenders or, if provided herein, in
accordance with the instructions given by the Majority Revolving Credit
Lenders or all of the Lenders as is required in such circumstance, and such
instructions of such Lenders and any action taken or failure to act pursuant
thereto shall be binding on all of the Lenders.
11.03 DEFAULTS. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of a Default unless the
Administrative Agent has received notice from a Lender or the Borrower
specifying such Default and stating that such notice is a "Notice of
Default". In the event that the Administrative Agent receives such a notice
of the occurrence of a Default, the Administrative Agent shall give prompt
notice thereof to the Lenders. The Administrative Agent shall (subject to
Section 11.07 hereof) take such action with respect to such Default as shall
be directed by the Majority Lenders or, if provided herein, the Majority
Revolving Credit Lenders, PROVIDED
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that, unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default
as it shall deem advisable in the best interest of the Lenders except to the
extent that this Agreement expressly requires that such action be taken, or
not be taken, only with the consent or upon the authorization of the Majority
Lenders, the Majority Revolving Credit Lenders or all of the Lenders.
11.04 RIGHTS AS A LENDER. With respect to its Commitments and the
Loans made by it, Chase (and any successor acting as Administrative Agent) in
its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Administrative Agent, and the term "Lender" or "Lenders" shall,
unless the context otherwise indicates, include the Administrative Agent in
its individual capacity. Chase (and any successor acting as Administrative
Agent) and its affiliates may (without having to account therefor to any
Lender) accept deposits from, lend money to, make investments in and
generally engage in any kind of banking, trust or other business with the
Obligors (and any of their Subsidiaries or Affiliates) as if it were not
acting as the Administrative Agent, and Chase and its affiliates (and any
such successor) and its affiliates may accept fees and other consideration
from the Obligors for services in connection with this Agreement or otherwise
without having to account for the same to the Lenders.
11.05 INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed under Section 12.03
hereof, but without limiting the obligations of the Borrower under said
Section 12.03) ratably in accordance with the aggregate principal amount of
the Loans and Reimbursement Obligations held by the Lenders (or, if no Loans
or Reimbursement Obligations are at the time outstanding, ratably in
accordance with their respective Commitments), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against the Administrative Agent
(including by any Lender) arising out of or by reason of any investigation in
or in any way relating to or arising out of this Agreement or any other Loan
Document or any other documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby (including,
without limitation, the costs and expenses that the Borrower is obligated to
pay under Section 12.03 hereof) or the enforcement of any of the terms hereof
or thereof or of any such other documents, PROVIDED that no Lender shall be
liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the party to be indemnified.
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11.06 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender agrees that it has, independently and without reliance on the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Borrower and its Subsidiaries and decision to enter into this Agreement and
that it will, independently and without reliance upon the Administrative
Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or under any
other Loan Document. The Administrative Agent shall not be required to keep
itself informed as to the performance or observance by any Obligor of this
Agreement or any of the other Loan Documents or any other document referred
to or provided for herein or therein or to inspect the Properties or books of
the Borrower or any of its Subsidiaries. Except for notices, reports and
other documents and information expressly required to be furnished to the
Lenders by the Administrative Agent hereunder or under the Security
Documents, the Administrative Agent shall not have any duty or responsibility
to provide any Lender with any credit or other information concerning the
affairs, financial condition or business of the Borrower or any of its
Subsidiaries (or any of their affiliates) that may come into the possession
of the Administrative Agent or any of its affiliates.
11.07 FAILURE TO ACT. Except for action expressly required of the
Administrative Agent hereunder and under the other Loan Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 11.05 hereof against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take
any such action.
11.08 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT. Subject to
the appointment and acceptance of a successor Administrative Agent as
provided below, the Administrative Agent may resign at any time by giving
notice thereof to the Lenders and the Borrower, and the Administrative Agent
may be removed at any time with or without cause by the Majority Lenders.
Upon any such resignation or removal, the Majority Lenders shall have the
right (with the consent of the Borrower, such consent not to be unreasonably
withheld) to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Majority Lenders and
shall have accepted such appointment within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Majority
Lenders' removal of the retiring Administrative Agent, then the retiring
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Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, that shall be a bank that has an office in New York,
New York with a combined capital and surplus of at least $500,000,000. Upon
the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Section 11 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as the Administrative Agent.
11.09 CONSENTS UNDER OTHER LOAN DOCUMENTS. Except as otherwise
provided in Section 12.04 hereof with respect to this Agreement, the
Administrative Agent may, with the prior consent of the Majority Lenders (but
not otherwise), consent to any modification, supplement or waiver under any
of the Loan Documents, PROVIDED that, without the prior consent of each
Lender, the Administrative Agent shall not (except as provided herein or in
the Security Documents) release any collateral or otherwise terminate any
Lien under any Security Document providing for collateral security, agree to
additional obligations being secured by such collateral security (unless the
Lien for such additional obligations shall be junior to the Lien in favor of
the other obligations secured by such Security Document, in which event the
Administrative Agent may consent to such junior Lien provided that it obtains
the consent of the Majority Lenders thereto), alter the relative priorities
of the obligations entitled to the benefits of the Liens created under the
Security Documents, except that no such consent shall be required, and the
Administrative Agent is hereby authorized, to release any Lien covering
Property that is the subject of either a disposition of Property permitted
hereunder or a disposition to which the Majority Lenders have consented.
Section 12. MISCELLANEOUS.
12.01 WAIVER. No failure on the part of the Administrative Agent
or any Lender to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power or privilege under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise
of any right, power or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. The remedies provided herein are cumulative and not exclusive of
any remedies provided by law.
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12.02 NOTICES. All notices, requests and other communications
provided for herein and in the Security Documents (including, without
limitation, any modifications of, or waivers or consents under, this
Agreement) shall be given or made in writing (including, without limitation,
by telecopy), delivered to the intended recipient at the address or telecopy
number specified (i) in the case of the Borrower and the Administrative
Agent, below their respective names on the signature pages hereof, (ii) in
the case of any Subsidiary Guarantor, below the signature of the Borrower on
the signature pages hereof and (iii) in the case of any other Lender, in its
Administrative Questionnaire; or, as to any party, at such other address as
shall be designated by such party in a notice to each other party. Except as
otherwise provided in this Agreement, all such communications shall be deemed
to have been duly given when transmitted by telecopier or personally
delivered or, in the case of a mailed notice, upon receipt, in each case
given or addressed as aforesaid.
12.03 EXPENSES, ETC. The Borrower agrees to pay or reimburse each
of the Lenders and the Administrative Agent for: (a) all reasonable
out-of-pocket costs and expenses of the Administrative Agent (including,
without limitation, the reasonable fees and expenses of Milbank, Tweed,
Xxxxxx & XxXxxx, special New York counsel to Chase) in connection with (i)
the negotiation, preparation, execution and delivery of this Agreement and
the other Loan Documents and the making of the extensions of credit hereunder
and (ii) the negotiation or preparation of any modification, supplement or
waiver of any of the terms of this Agreement or any of the other Loan
Documents (whether or not consummated); (b) all reasonable out-of-pocket
costs and expenses of the Lenders and the Administrative Agent (including,
without limitation, the reasonable fees and expenses of legal counsel) in
connection with (i) any Default and any enforcement or collection proceedings
resulting therefrom, including, without limitation, all manner of
participation in or other involvement with (x) bankruptcy, insolvency,
receivership, foreclosure, winding up or liquidation proceedings, (y)
judicial or regulatory proceedings and (z) workout, restructuring or other
negotiations or proceedings (whether or not the workout, restructuring or
transaction contemplated thereby is consummated) and (ii) the enforcement of
this Section 12.03; and (c) all transfer, stamp, documentary or other similar
taxes, assessments or charges levied by any governmental or revenue authority
in respect of this Agreement or any of the other Loan Documents or any other
document referred to herein or therein and all costs, expenses, taxes,
assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
by any Security Document or any other document referred to therein.
CREDIT AGREEMENT
- 110 -
The Borrower hereby agrees to indemnify the Administrative Agent
and each Lender and their respective directors, officers, trustees,
employees, attorneys and agents from, and hold each of them harmless against,
any and all losses, liabilities, claims, damages or expenses incurred by any
of them (including, without limitation, any and all losses, liabilities,
claims, damages or expenses incurred by the Administrative Agent to any
Lender, whether or not the Administrative Agent or any Lender is a party
thereto) arising out of or by reason of any investigation or litigation or
other proceedings (including any threatened investigation or litigation or
other proceedings) relating to the extensions of credit hereunder or any
actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the extensions of credit hereunder, including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation or litigation or other proceedings
(but excluding any such losses, liabilities, claims, damages or expenses
incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified). Without limiting the generality of the foregoing,
the Borrower will indemnify the Administrative Agent and each Lender from,
and hold the Administrative Agent and each Lender harmless against, any
losses, liabilities, claims, damages or expenses described in the preceding
sentence (including any Lien filed against any Property covered by the
Mortgages or any part of the collateral thereunder in favor of any
governmental entity, but excluding, as provided in the preceding sentence,
any loss, liability, claim, damage or expense incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified) arising
under any Environmental Law as a result of the past, present or future
operations of the Borrower or any of its Subsidiaries (or any predecessor in
interest to the Borrower or any of its Subsidiaries), or the past, present or
future condition of any site or facility owned, operated or leased at any
time by the Borrower or any of its Subsidiaries (or any such predecessor in
interest), or any Release or threatened Release of any Hazardous Materials at
or from any such site or facility, excluding any such Release or threatened
Release that shall occur during any period when the Administrative Agent or
any Lender shall be in possession of any such site or facility following the
exercise by the Administrative Agent or any Lender of any of its rights and
remedies hereunder or under any of the Security Documents, but including any
such Release or threatened Release occurring during such period that is a
continuation of conditions previously in existence, or of practices employed
by the Borrower and its Subsidiaries, at such site or facility.
12.04 AMENDMENTS, ETC. Except as otherwise expressly provided in
this Agreement, any provision of this Agreement may be modified or
supplemented only by an instrument in writing
CREDIT AGREEMENT
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signed by the Borrower and the Majority Lenders, or by the Borrower and the
Administrative Agent acting with the consent of the Majority Lenders, and any
provision of this Agreement may be waived by the Majority Lenders or by the
Administrative Agent acting with the consent of the Majority Lenders;
PROVIDED that: (a) no modification, supplement or waiver shall, unless by an
instrument signed by all of the Lenders or by the Administrative Agent acting
with the consent of all of the Lenders (i) increase, or extend the term of
any of the Commitments, or extend the time or waive any requirement for the
reduction or termination of any of the Commitments, (ii) extend the date
fixed for any payment of principal of or interest on any Loan, the
Reimbursement Obligations or any fee hereunder, (iii) reduce the amount of
any such payment of principal, (iv) reduce the rate at which interest is
payable thereon or any fee is payable hereunder, (v) alter the rights or
obligations of the Borrower to prepay Loans, (vi) alter the manner in which
payments or prepayments of principal, interest or other amounts hereunder
shall be applied as between the Lenders or Types or Classes of Loans, (vii)
alter the terms of this Section 12.04, (viii) modify the definition of the
term "Majority Lenders" or "Majority Revolving Credit Lenders", or modify in
any other manner the number or percentage of the Lenders required to make any
determinations or waive any rights hereunder or to modify any provision
hereof, (ix) release any Subsidiary Guarantor from any of its guarantee
obligations under Section 6 hereof (except in connection with the disposition
of such Subsidiary in a transaction permitted hereunder or to which the
Majority Lenders shall have consented), or (x) waive any of the conditions
precedent set forth in Section 7.01 hereof; (b) any modification or
supplement of Section 11 hereof, or of any of the rights or duties of the
Administrative Agent hereunder, shall require the consent of the
Administrative Agent; and (c) any modification or supplement of Section 6
hereof shall require the consent of each Subsidiary Guarantor.
12.05 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
12.06 ASSIGNMENTS AND PARTICIPATIONS.
(a) No Obligor may assign any of its rights or obligations
hereunder without the prior consent of all of the Lenders and the
Administrative Agent.
(b) Each Lender may assign any of its Loans, its Commitments, and,
if such Lender is a Revolving Credit Lender, its Letter of Credit Interest
(but only with the consent of, (x) in the case of its outstanding
Commitments, the Borrower and the Administrative Agent, which consent in
either case shall not be unreasonably withheld and, (y) in the case of the
Revolving
CREDIT AGREEMENT
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Credit Commitment or a Letter of Credit Interest, the Issuing Lender),
PROVIDED that:
(i) no such consent by the Borrower, the Administrative Agent or
the Issuing Lender shall be required in the case of any assignment to
another Lender (or any of its affiliates);
(ii) except to the extent the Borrower and the Administrative
Agent shall otherwise consent, any such partial assignment (other than
to another Lender) shall be in an amount at least equal to $5,000,000,
and after giving effect thereto, the assigning Lender shall have
Commitments and Loans in an aggregate amount of at least $5,000,000;
(iii) each such assignment by a Lender of its Revolving Credit
Loans, Revolving Credit Commitment or Letter of Credit Interest shall be
made in such manner so that (A) the same portion of its Revolving Credit
Loans, Revolving Credit Commitment and Letter of Credit Interest is
assigned to the respective assignee and (B) after giving effect to such
assignment, the Revolving Credit Commitment of the assignor equals or
exceeds the sum of (x) its Sterling Sub-Limit (if any) PLUS (y) its
Revolving Credit Commitment Percentage of the Letter of Credit Limit;
(iv) each such assignment by a Sterling Lender of its Sterling
Loans shall be made in such manner so that (A) the same portion of its
Sterling Loans and Sterling Sub-Limit is assigned to the respective
assignee, (B) after giving effect to such assignment, the Revolving
Credit Commitments of the assignor and the assignee exceed the sum of
(x) their respective Sterling Sub-Limits PLUS (y) their respective
Revolving Credit Commitment Percentages of the Letter of Credit Limit;
(v) each such assignment by a Lender of its Incremental Term Loans
shall be made in such manner so that the same portion of its Incremental
Term Loans and Incremental Term Loan Commitment is assigned to the
respective assignee; and
(vi) each such assignment shall be effected pursuant to an
Assignment and Acceptance substantially in the form of Exhibit G hereto,
executed by the assigning Lender and the assignee and delivered to the
Administrative Agent for its acceptance and recording in the register
referred to below.
Upon execution and delivery of such Assignment and Acceptance, and subject to
the consent thereto by the Borrower, the Administrative Agent and the Issuing
Lender to the extent
CREDIT AGREEMENT
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required above, the assignee shall have, to the extent of such assignment
(unless otherwise consented to by the Borrower, the Administrative Agent and
the Issuing Lender), the obligations, rights and benefits of a Lender
hereunder holding the Commitment(s), Loans and, if applicable, Letter of
Credit Interest (or portions thereof) assigned to it and specified in such
Assignment and Acceptance (in addition to the Commitment(s), Loans and Letter
of Credit Interest, if any, theretofore held by such assignee) and the
assigning Lender shall, to the extent of such assignment, be released from
the Commitment(s) (or portion(s) thereof) so assigned. Upon each such
assignment the assigning Lender shall pay the Administrative Agent an
assignment fee of $3,000. The Administrative Agent shall maintain a register
for the recordation of the names and addresses of the Lenders and the
principal amount of the Loans owing by the Borrower to each Lender from time
to time. The entries in such register shall be conclusive, in the absence of
clearly demonstrable error, and the Borrower, the Administrative Agent and
the Lenders may treat each Person whose name is recorded therein as the owner
of the Loan or Loans recorded therein for all purposes of this Agreement.
Such register shall be available for inspection by the Borrower and any
Lender at any reasonable time upon reasonable prior notice.
(c) A Lender may sell or agree to sell to one or more other
Persons (each a "PARTICIPANT") a participation in all or any part of any
Loans or Letter of Credit Interest held by it, or in its Commitments,
PROVIDED that such Participant shall not have any rights or obligations under
this Agreement or any other Loan Document (the Participant's rights against
such Lender in respect of such participation to be those set forth in the
agreements executed by such Lender in favor of the Participant). All amounts
payable by the Borrower to any Lender under Section 5 hereof in respect of
Loans, Letter of Credit Interest held by it, and its Commitments, shall be
determined as if such Lender had not sold or agreed to sell any
participations in such Loans, Letter of Credit Interest and Commitments, and
as if such Lender were funding each of such Loans, Letter of Credit Interest
and Commitments in the same way that it is funding the portion of such Loans,
Letter of Credit Interest and Commitments in which no participations have
been sold. In no event shall a Lender that sells a participation agree with
the Participant to take or refrain from taking any action hereunder or under
any other Loan Document except that such Lender may agree with the
Participant that it will not, without the consent of the Participant, agree
to (i) extend the term of such Lender's related Commitment or extend the
amount or date of any scheduled reduction of such Commitment pursuant to
Section 2.04 hereof, (ii) extend the date fixed for the payment of principal
of or interest on the related Loan or Loans, Reimbursement Obligations or any
portion of any fee hereunder payable to the Participant, (iii) reduce the
amount
CREDIT AGREEMENT
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of any such payment of principal, (iv) reduce the rate at which interest is
payable thereon, or any fee hereunder payable to the Participant, to a level
below the rate at which the Participant is entitled to receive such interest
or fee or (v) consent to any modification, supplement or waiver hereof or of
any of the other Loan Documents to the extent that the same, under Section
11.09 or 12.04 hereof, requires the consent of each Lender.
(d) In addition to the assignments and participations permitted
under the foregoing provisions of this Section 12.06, any Lender may (without
notice to the Borrower, the Administrative Agent or any other Lender and
without payment of any fee) (i) assign and pledge all or any portion of its
Loans and any promissory note issued hereunder to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank and (ii) assign all or any portion of its
rights under this Agreement and its Loans to an affiliate. No such
assignment shall release the assigning Lender from its obligations hereunder
(except that such assignment shall release the assigning Lender to the extent
the same is effected in accordance with the provisions of paragraph (b)
above).
(e) A Lender may furnish any information concerning the Borrower
or any of its Subsidiaries in the possession of such Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject, however, to the provisions of Section 12.12(b) hereof.
(f) Anything in this Section 12.06 to the contrary
notwithstanding, no Lender may assign or participate any interest in any Loan
or Reimbursement Obligation held by it hereunder to the Borrower or any of
its Affiliates or Subsidiaries without the prior consent of each Lender,
except that this paragraph (f) shall not prohibit any such assignment or
participation to any Affiliate of the Borrower that is a bank or trust
company organized under the laws of the United States of America or a State
thereof and that is supervised by the Office of the Comptroller of the
Currency or the Board of Governors of the Federal Reserve.
(g) At the request of any Lender that is not a U.S. Person and is
not a "bank" within the meaning of Section 881(c)(3)(A) of the Code, the
Borrower shall maintain, or cause to be maintained, a register (which will be
separate from the register referred to in the last sentence of Section
12.06(b) hereof) that, at the request of the Borrower, shall be kept by the
Administrative Agent on behalf of the Borrower at no charge to the Borrower
at the address to which notices to the Administrative Agent are to be sent
hereunder, on which it enters the name of such Lender as the registered owner
of each Loan held
CREDIT AGREEMENT
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by such Lender. Each Loan so registered shall be a "REGISTERED LOAN". A
Registered Loan may be assigned or otherwise transferred in whole or in part
by registration of such assignment or transfer on such register. Any
assignment or transfer of all or part of such Loan may be effected by
registration of such assignment or transfer on such register, together with
the surrender of the promissory note, if any, evidencing the same duly
endorsed by (or accompanied by a written instrument of assignment or transfer
duly executed by) the holder of such promissory note, whereupon, at the
request of the designated assignee(s) or transferee(s), one or more new
promissory notes, payable to such Lender or its registered assigns, in the
same aggregate principal amount shall be issued to the designated assignee(s)
or transferee(s). Prior to the registration of assignment or transfer of any
Registered Loan, the Borrower shall treat the Person in whose name such Loan
is registered as the owner thereof for the purpose of receiving all payments
thereon and for all other purposes, notwithstanding notice to the contrary.
The register referred to above in this Section 12.06(g) shall be available
for inspection by the Borrower and any Lender that is a Registered Holder at
any reasonable time upon reasonable prior notice.
12.07 SURVIVAL. The obligations of the Borrower under Sections
5.01, 5.05, 5.06, 5.07 and 12.03 hereof, the obligations of each Subsidiary
Guarantor under Section 6.03 hereof, and the obligations of the Lenders under
Section 11.05 hereof, shall survive the repayment of the Loans and
Reimbursement Obligations and the termination of the Commitments and, in the
case of any Lender that may assign any interest in its Commitments, Loans or
Letter of Credit Interest hereunder, shall survive the making of such
assignment, notwithstanding that such assigning Lender may cease to be a
"Lender" hereunder. In addition, each representation and warranty made, or
deemed to be made by a notice of any extension of credit (whether by means of
a Loan or a Letter of Credit), herein or pursuant hereto shall survive the
making of such representation and warranty, and no Lender shall be deemed to
have waived, by reason of making any extension of credit hereunder (whether
by means of a Loan or Letter of Credit), any Default that may arise by reason
of such representation or warranty proving to have been false or misleading,
notwithstanding that such Lender or the Administrative Agent may have had
notice or knowledge or reason to believe that such representation or warranty
was false or misleading at the time such extension of credit was made.
12.08 CAPTIONS. The table of contents and captions and section
headings appearing herein are included solely for convenience of reference
and are not intended to affect the interpretation of any provision of this
Agreement.
CREDIT AGREEMENT
- 116 -
12.09 COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart.
12.10 GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement
shall be governed by, and construed in accordance with, the law of the State
of New York. Each Obligor hereby submits to the nonexclusive jurisdiction of
the United States District Court for the Southern District of New York and of
the Supreme Court of the State of New York sitting in New York County
(including, without limitation, its Appellate Division), and of any other
appellate court in the State of New York, for the purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. Each Obligor hereby irrevocably waives, to the fullest
extent permitted by applicable law, any objection that it may now or
hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court
has been brought in an inconvenient forum.
12.11 WAIVER OF JURY TRIAL. EACH OF THE OBLIGORS, THE
ADMINISTRATIVE AGENT AND EACH LENDER HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY.
12.12 TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY.
(a) The Borrower acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
the Borrower or one or more of its Subsidiaries (in connection with this
Agreement or otherwise) by any Lender or by one or more subsidiaries or
affiliates of such Lender and the Borrower hereby authorizes each Lender to
share any information delivered to such Lender by the Borrower and its
Subsidiaries pursuant to this Agreement, or in connection with the decision
of such Lender to enter into this Agreement, to any such subsidiary or
affiliate, it being understood that any such subsidiary or affiliate
receiving such information shall be bound by the provisions of Section
12.12(b) hereof as if it were a Lender hereunder. Such authorization shall
survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments.
(b) Each Lender and the Administrative Agent agrees (on behalf of
itself and each of its affiliates, directors,
CREDIT AGREEMENT
- 117 -
officers, employees and representatives) to keep confidential, in accordance
with their customary procedures for handling confidential information of the
same nature, any non-public information supplied to it by the Borrower
pursuant to this Agreement that is identified by the Borrower as being
confidential at the time the same is delivered to the Lenders or the
Administrative Agent, PROVIDED that nothing herein shall limit the disclosure
of any such information (i) after such information shall have become public
(other than through a violation of this Section 12.12), (ii) to the extent
required by statute, rule, regulation or judicial process, (iii) to counsel
for any of the Lenders or the Administrative Agent, (iv) to bank examiners
(or any other regulatory authority having jurisdiction over any Lender or the
Administrative Agent), or to auditors or accountants, (v) to the
Administrative Agent or any other Lender (or to Chase Securities, Inc.), (vi)
in connection with any litigation to which any one or more of the Lenders or
the Administrative Agent is a party, or in connection with the enforcement of
rights or remedies hereunder or under any other Loan Document, (vii) to a
subsidiary or affiliate of such Lender as provided in Section 12.12(a) hereof
or (viii) to any assignee or participant (or prospective assignee or
participant) so long as such assignee or participant (or prospective assignee
or participant) first executes and delivers to the respective Lender a
Confidentiality Agreement substantially in the form of Exhibit F hereto (or
executes and delivers to such Lender an acknowledgement to the effect that it
is bound by the provisions of this Section 12.12(b), which acknowledgement
may be included as part of the respective assignment or participation
agreement pursuant to which such assignee or participant acquires an interest
in the Loans or Letter of Credit Interest hereunder); PROVIDED, FURTHER, that
in no event shall any Lender or the Administrative Agent be obligated or
required to return any materials furnished by the Borrower. The obligations
of any assignee that has executed a Confidentiality Agreement in the form of
Exhibit F hereto shall be superseded by this Section 12.12 upon the date upon
which such assignee becomes a Lender hereunder pursuant to Section 12.06(b)
hereof.
CREDIT AGREEMENT
- 118 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered as of the day and year first above written.
BORROWER
PANAVISION INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------
Title: Executive Vice President
Address for Notices:
Panavision Inc.
0000 Xx Xxxx Xxxxxx
Xxxxxxxx Xxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
CREDIT AGREEMENT
- 119 -
SUBSIDIARY GUARANTORS
PANAVISION INTERNATIONAL, L.P.
By Panavision Inc.,
its general partner
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Title: Executive Vice President
KEEPCO I, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Title: Assistant Secretary
KEEPCO II, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Title: Assistant Secretary
PANAVISION U.K. HOLDINGS, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Title: Vice President
XXXXXX XXXXXX, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------
Title: Vice President
CREDIT AGREEMENT
- 120 -
LENDERS
THE CHASE MANHATTAN BANK
By /s/ Xxxxxx X. Xxxxx
--------------------------------
Title: Vice President
CIBC INC.
By /s/ Xxxxxxx X. Xxxxx
--------------------------------
Title: Authorized Signatory
BANKBOSTON, N.A.
By /s/ Xxxxxxx Xxxxxxx
--------------------------------
Title: Director
THE BANK OF NOVA SCOTIA
By /s/ Xxxxxxx Xxxxxxxx
--------------------------------
Title: Vice President
BANK OF HAWAII
By /s/ Xxxxxx X. Xxxxxx
-------------------------------
Title: Vice President
ABN AMRO BANK N.V.
By /s/ Xxxxxxx Xxxxxxxx
--------------------------------
Title: Group Vice President
By /s/ Xxxx X. Xxxxxx
--------------------------------
Title: Group Vice President
CREDIT AGREEMENT
- 121 -
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By /s/ Xxxxx X. Xxxxxx
--------------------------------
Title: Vice President
FLEET NATIONAL BANK
By /s/ Xxxx Xxxxx
--------------------------------
Title: Vice President
LLOYDS BANK PLC
By /s/ Xxx Xxxxxx
--------------------------------
Title: Senior Vice President
By /s/ Xxxx Xxxxxxxxx
--------------------------------
Title: Vice President B374
CREDIT AGREEMENT
- 122 -
ADMINISTRATIVE AGENT
THE CHASE MANHATTAN BANK,
as Administrative Agent
By /s/ Xxxxxx X. Xxxxx
--------------------------------
Title: Vice President
Address for Notices to
the Administrative Agent:
The Chase Manhattan Bank
1 Chase Manhattan Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Agent Bank Services
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
CREDIT AGREEMENT
SCHEDULE I
COMMITMENTS
Tranche A
Revolving Credit Sterling Term Loan
Lender Commitment Sub-Limit Commitment
------ ---------------- --------- ----------
The Chase Manhattan
Bank $21,600,000.00 $ 8,474,576.26 $14,400,000.00
CIBC Inc. 13,800,000.00 7,796,610.17 9,200,000.00
BankBoston, N.A. 12,000,000.00 6,779,661.02 8,000,000.00
The Bank of Nova
Scotia 12,000,000.00 6,779,661.02 8,000,000.00
Bank of Hawaii 6,600,000.00 4,400,000.00
ABN AMRO Bank N.V. 6,000,000.00 3,389,830.51 4,000,000.00
Bank of Tokyo-Mitsubishi
Trust Company 6,000,000.00 4,000,000.00
Fleet National Bank 6,000,000.00 3,389,830.51 4,000,000.00
Lloyds Bank plc 6,000,000.00 3,389,830.51 4,000,000.00
-------------- -------------- --------------
$90,000,000.00 $40,000,000.00 $60,000,000.00
CREDIT AGREEMENT
SCHEDULE II
MATERIAL AGREEMENTS AND LIENS
[Section 8.12(a), (b); 9.07(b)]
A. Material Agreements
B. Liens
SCHEDULE I
SCHEDULE III
SUBSIDIARIES AND INVESTMENTS
[Section 8.15(a), (b)]
A. Subsidiaries
B. Investments
SCHEDULE II
SCHEDULE IV
EQUITY INTERESTS OF THE BORROWER
[Section 8.14]
SCHEDULE III
SCHEDULE V
LITIGATION
[Section 8.03]
SCHEDULE IV
SCHEDULE VI
TAXES
[Section 8.09]
SCHEDULE V
SCHEDULE VII
ENVIRONMENTAL MATTERS
[Section 8.13]
SCHEDULE VI
EXHIBIT A
[Form of Incremental Term Loan Activation Notice]
INCREMENTAL TERM LOAN ACTIVATION NOTICE
To: The Chase Manhattan Bank
as Administrative Agent under
the Credit Agreement referred to below
Reference is hereby made to the Credit Agreement dated as of June 5,
1997 (as modified and supplemented and in effect from time to time, the
"CREDIT AGREEMENT") between Panavision Inc., the Subsidiary Guarantors party
thereto, the Lenders party thereto and The Chase Manhattan Bank, as
Administrative Agent. Terms defined in the Credit Agreement and not defined
herein are used herein as defined therein.
This notice is the Incremental Term Loan Activation Notice referred
to in the Credit Agreement, and the Borrower and each of the Lenders
signatory hereto (the "INCREMENTAL TERM LOAN LENDERS") hereby notify you that:
1. The Incremental Term Loan Activation Date is .
-----------
2. The Incremental Term Loan Commitment Termination Date is
.
-----------
3. The Incremental Term Loan Commitment of each Incremental Term
Loan Lender is set forth opposite such Incremental Term Loan
Lender's name on the signature pages hereof under the caption
"Incremental Term Loan Commitment".
Each of the Incremental Term Loan Lenders and the Borrower hereby
agrees that (a) the rate of commitment fee payable by the Borrower to each
Incremental Term Loan Lender under Section 2.05(b) of the Credit Agreement on
the daily average unused amount of such Incremental Term Loan Commitment
shall be , (b) the Applicable Margin for Incremental Term Loans
--------------
shall be and (c) the Incremental Term Loan Principal Payment
--------------
Dates shall be the Quarterly Dates falling on or nearest to March 31, June
30, September 30 and December 31 of each year, commencing with ,
------------
through and including .
--------------------
The Borrower and the Incremental Term Loan Lenders further agree
that the principal of the Incremental Term Loans shall be payable in
installments payable on the Incremental Term Loan Principal
-----------
Payment Dates as follows:
INCREMENTAL TERM LOAN ACTIVATION NOTICE
- 2 -
Amount of Installment
Incremental Term Loan (as a percentage of
Principal Payment Date Incremental Term
Falling on or Nearest to: Loans borrowed)
-------------------------- ----------------------
[TO BE COMPLETED IN ACCORDANCE WITH
SECTION 3.01(c) OF THE CREDIT AGREEMENT]
PANAVISION INC.
By
----------------------------
Name:
Title:
INCREMENTAL TERM LOAN COMMITMENT [NAME OF INCREMENTAL TERM LOAN
--------------------------------
$ LENDER]
By
----------------------------
Name:
Title:
[COMPLETE FOR EACH INCREMENTAL TERM LOAN LENDER]
CONSENTED TO:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By
-----------------------
Name:
Title:
INCREMENTAL TERM LOAN ACTIVATION NOTICE
EXHIBIT B
[Form of Security Agreement]
SECURITY AGREEMENT
SECURITY AGREEMENT dated as of June 5, 1997 between PANAVISION INC.,
a Delaware corporation (the "BORROWER"); each of the Subsidiaries of the
Borrower that may become a "Securing Party" hereunder pursuant to the
provisions of Section 6.11 hereof, (individually, a "SUBSIDIARY GUARANTOR"
and, collectively, the "SUBSIDIARY GUARANTORS" and, together with the
Borrower, the "SECURING PARTIES"); and THE CHASE MANHATTAN BANK, as
administrative agent for the lenders or other financial institutions or
entities party, as lenders, to the Credit Agreement referred to below (in
such capacity, together with its successors in such capacity, the
"ADMINISTRATIVE AGENT").
The Borrower, the Subsidiary Guarantors, certain lenders and the
Administrative Agent are parties to a Credit Agreement dated as of June 5,
1997 (as modified and supplemented and in effect from time to time, the
"CREDIT AGREEMENT"), providing, subject to the terms and conditions thereof,
for extensions of credit (by making of loans, including, without limitation,
the Incremental Term Loans referred to therein and issuing letters of credit)
to be made by the Lenders (as defined in the Credit Agreement) to the
Borrower in an aggregate principal or face amount not exceeding $200,000,000.
In addition, the Borrower may from time to time be obligated to one or more
of the Lenders (as so defined), or an Affiliate of any Lender, in respect of
one or more Interest Rate Protection Agreements (such indebtedness being
herein referred to as the "OTHER INDEBTEDNESS").
To induce the Lenders (as so defined) to enter into the Credit
Agreement and to extend credit thereunder and to extend credit to the
Borrower that would constitute Other Indebtedness, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Securing Party has agreed to pledge and grant a security
interest in the Collateral (as hereinafter defined) as security for the
Secured Obligations (as so defined). Accordingly, the parties hereto agree
as follows:
Section 1. DEFINITIONS. Terms defined in the Credit Agreement are
used herein as defined therein. In addition, as used herein:
"ACCOUNTS" shall have the meaning ascribed thereto in Section 3(e)
hereof.
"COLLATERAL" shall have the meaning ascribed thereto in
SECURITY AGREEMENT
Section 3 hereof.
"COLLATERAL ACCOUNT" shall have the meaning ascribed thereto in
Section 4.01 hereof.
"COPYRIGHT COLLATERAL" shall mean all Copyrights, whether now owned
or hereafter acquired by any Obligor, including each Copyright identified in
Annex 2 hereto.
"COPYRIGHTS" shall mean all copyrights, copyright registrations and
applications for copyright registrations, including, without limitation, all
renewals and extensions thereof, the right to recover for all past, present
and future infringements thereof, and all other rights of any kind whatsoever
accruing thereunder or pertaining thereto.
"DOCUMENTS" shall have the meaning ascribed thereto in Section 3(k)
hereof.
"EQUIPMENT" shall have the meaning ascribed thereto in Section 3(i)
hereof.
"INSTRUMENTS" shall have the meaning ascribed thereto in Section
3(f) hereof.
"INTELLECTUAL PROPERTY" shall mean, collectively, all Copyright
Collateral, all Patent Collateral and all Trademark Collateral, together with
(a) all inventions, processes, production methods, proprietary information,
know-how and trade secrets; (b) all licenses or user or other agreements
granted to any Obligor with respect to any of the foregoing, in each case
whether now or hereafter owned or used including, without limitation, the
licenses or other agreements with respect to the Copyright Collateral, the
Patent Collateral or the Trademark Collateral, listed in Annex 5 hereto; (c)
all information, customer lists, identification of suppliers, data, plans,
blueprints, specifications, designs, drawings, recorded knowledge, surveys,
engineering reports, test reports, manuals, materials standards, processing
standards, performance standards, catalogs, computer and automatic machinery
software and programs; (d) all field repair data, sales data and other
information relating to sales or service of products now or hereafter
manufactured; (e) all accounting information and all media in which or on
which any information or knowledge or data or records may be recorded or
stored and all computer programs used for the compilation or printout of such
information, knowledge, records or data; and (f) all consents, permits,
variances, certifications and approvals of governmental agencies now or
hereafter held by any Securing Party.
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"INVENTORY" shall have the meaning ascribed thereto in Section 3(g)
hereof.
"ISSUERS" shall mean, collectively, the respective corporations,
partnerships or other entities identified beneath the names of the Securing
Parties on Annex 1 hereto under the caption "ISSUER".
"MOTOR VEHICLES" shall mean motor vehicles, tractors, trailers and
other like property, whether or not the title thereto is governed by a
certificate of title or ownership.
"PARTNERSHIP COLLATERAL" shall mean, collectively, the Collateral
described in clause (d) of Section 3 hereof and the proceeds of and to any
such property and, to the extent related to any such property or such
proceeds, all books, correspondence, credit files, records, invoices and
other papers.
"PATENT COLLATERAL" shall mean all Patents, whether now owned or
hereafter acquired by any Obligor, including each Patent identified in Annex
3 hereto.
"PATENTS" shall mean all patents and patent applications, including,
without limitation, the inventions and improvements described and claimed
therein together with the reissues, divisions, continuations, renewals,
extensions and continuations-in-part thereof, all income, royalties, damages
and payments now or hereafter due and/or payable under and with respect
thereto, including, without limitation, damages and payments for past or
future infringements thereof, the right to xxx for past, present and future
infringements thereof, and all rights corresponding thereto throughout the
world.
"PLEDGED STOCK" shall have the meaning ascribed thereto in Section
3(a) hereof.
"SECURED OBLIGATIONS" shall mean, collectively, (a) in the case of
the Borrower, the principal of and interest on the Loans made by the Lenders
to the Borrower and all other amounts from time to time owing to the Lenders
or the Administrative Agent by the Borrower under the Loan Documents
(including, without limitation, all Reimbursement Obligations, Other
Indebtedness and interest thereon), (b) in the case of the Subsidiary
Guarantors, all obligations of the Subsidiary Guarantors under the Credit
Agreement and the other Loan Documents (including, without limitation, in
respect of their Guarantee under, and pursuant to the terms of, Section 6 of
the Credit Agreement) and (c) in the case of all Securing Parties, all
obligations of the Securing Parties to the Lenders and the
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Administrative Agent hereunder.
"STOCK COLLATERAL" shall mean, collectively, the Collateral
described in clauses (a) through (c) of Section 3 hereof and the proceeds of
and to any such property and, to the extent related to any such property or
such proceeds, all books, correspondence, credit files, records, invoices and
other papers.
"TRADEMARK COLLATERAL" shall mean all Trademarks, whether now owned
or hereafter acquired by any Securing Party, including each Trademark
identified in Annex 2 hereto but excluding any Trademark transferred in
accordance with Section 5.04(b)(ii) hereof. Notwithstanding the foregoing,
the Trademark Collateral does not and shall not include any Trademark that
would be rendered invalid, abandoned, void or unenforceable by reason of its
being included as part of the Trademark Collateral.
"TRADEMARKS" shall mean all trade names, trademarks and service
marks, logos, trademark and service xxxx registrations, and applications for
trademark and service xxxx registrations, including, without limitation, all
renewals of trademark and service xxxx registrations, all rights
corresponding thereto throughout the world, the right to recover for all
past, present and future infringements thereof, all other rights of any kind
whatsoever accruing thereunder or pertaining thereto, together, in each case,
with the product lines and goodwill of the business connected with the use
of, and symbolized by, each such trade name, trademark and service xxxx.
"UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial Code as
in effect from time to time in the State of New York.
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Section 2. REPRESENTATIONS AND WARRANTIES. Each Securing Party
represents and warrants to the Lenders and the Administrative Agent that:
(a) Such Securing Party is the sole beneficial owner of the
Collateral in which it purports to grant a security interest pursuant to
Section 3 hereof and no Lien exists or will exist upon such Collateral
at any time (and no right or option to acquire the same exists in favor
of any other Person), except for Liens permitted under Section 9.06 of
the Credit Agreement and except for the pledge and security interest in
favor of the Administrative Agent for the benefit of the Lenders created
or provided for herein, which pledge and security interest constitute a
first priority perfected pledge and security interest in and to all of
such Collateral.
(b) The Pledged Stock represented by the certificates identified
under the name of such Securing Party in Annex 1 hereto is, and all
other Pledged Stock in which such Securing Party shall hereafter grant a
security interest pursuant to Section 3 hereof will be, duly authorized,
validly existing, fully paid and non-assessable and none of such Pledged
Stock is or will be subject to any contractual restriction, or any
restriction under the charter or by-laws of the respective Issuer of
such Pledged Stock, upon the transfer of such Pledged Stock (except for
(i) any such restriction contained herein or in the Credit Agreement and
(ii) the Unanimous Shareholder Agreement (the "Unanimous Shareholder
Agreement") governing Panavision Canada Holdings Inc. made as of January
18, 1995 and the provisions contained in the articles of incorporation
of Panavision Canada Holdings Inc. as of the date hereof which require
the directors of Panavision Canada Holdings Inc. to approve any transfer
of its shares (which provisions, however, have been complied with by the
sole shareholder of Panavision Canada Holdings Inc. acting pursuant to
the Unanimous Shareholder Agreement in relation to the pledge
contemplated hereby and any enforcement and/or resulting sale of such
Pledged Stock hereunder)).
(c) The Pledged Stock represented by the certificates identified
under the name of such Securing Party in Annex 1 hereto constitutes all
(or, in the case of an Issuer organized under the laws a jurisdiction
other than the United States of America or a State thereof, 66%) of the
issued and outstanding shares of capital stock of any class of the
Issuers beneficially owned by such Securing Party on the date hereof
(whether or not registered in the name of such Securing Party) and said
Annex 1 correctly identifies, as at the date hereof, the respective
Issuers of such
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Pledged Stock, the respective class and par value of the shares
comprising such Pledged Stock and the respective number of shares (and
registered owners thereof) represented by each such certificate. The
partnership interests identified under the name of such Securing Party
in Annex 1 hereto constitute all of the partnership interests of the
Issuers beneficially owned by such Securing Party on the date hereof,
and Annex 1 correctly identifies, as of the date hereof, the partnership
interests of the Issuers held by such Securing Party.
(d) Annexes 2, 3 and 4 hereto, respectively, set forth under the
name of such Securing Party a complete and correct list of all
Copyrights, Patents and Trademarks owned by such Securing Party on the
date hereof; except pursuant to licenses and other user agreements
entered into by such Securing Party in the ordinary course of business,
that are listed in Annex 5 hereto, such Securing Party owns and
possesses the right to use, and has done nothing to authorize or enable
any other Person to use, any Copyright, Patent or Trademark listed in
said Annexes 2, 3 and 4, and all registrations listed in said Annexes 2,
3 and 4 are valid and in full force and effect; except as may be set
forth in said Annex 5, such Securing Party owns and possesses the right
to use all Copyrights, Patents and Trademarks.
(e) Annex 5 hereto sets forth a complete and correct list of all
licenses and other user agreements included in the Intellectual Property
on the date hereof.
(f) To such Securing Party's knowledge, (i) except as set forth in
Annex 5 hereto, there is no violation by others of any right of such
Securing Party with respect to any Copyright, Patent or Trademark listed
in Annexes 2, 3 and 4 hereto, respectively, under the name of such
Securing Party and (ii) such Securing Party is not infringing in any
respect upon any Copyright, Patent or Trademark of any other Person; and
no proceedings have been instituted or are pending against such Securing
Party or, to such Securing Party's knowledge, threatened, and no claim
against such Securing Party has been received by such Securing Party,
alleging any such violation, except as may be set forth in said Annex 5.
(g) Such Securing Party does not own any Trademarks registered in
the United States of America to which the last sentence of the
definition of Trademark Collateral applies.
(h) Any goods now or hereafter produced by such Securing Party or
any of its Subsidiaries included in the Collateral have been and will be
produced in compliance with
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the requirements of the Fair Labor Standards Act, as amended.
Section 3. COLLATERAL. As collateral security for the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations, each Securing Party hereby pledges and
grants to the Administrative Agent, for the benefit of the Lenders as
hereinafter provided, a security interest in all of such Securing Party's
right, title and interest in the following property, whether now owned by
such Securing Party or hereafter acquired and whether now existing or
hereafter coming into existence (all being collectively referred to herein as
"COLLATERAL"):
(a) the shares of common and preferred stock of the Issuers
represented by the certificates identified in Annex 1 hereto under the
name of such Securing Party and all other shares, but only to the extent
set forth in Section 5.04(a)(i) hereof, of capital stock of whatever
class of the Issuers, now or hereafter owned by such Securing Party, in
each case together with the certificates evidencing the same
(collectively, the "PLEDGED STOCK"), it being understood that to the
extent a Securing Party shall have delivered stock certificates of
Panavision Canada Holdings Inc. representing a number of shares greater
than the number of shares representing Pledged Stock, the Administrative
Agent agrees that (i) such excess stock shall not thereby be deemed
pledged but shall be held for the benefit of the Securing Party, and
(ii) at any time and from time to time, at the request of such Securing
Party, to return to such Securing Party certificate(s) representing up
to the number of the shares in excess of shares representing the Pledged
Stock; PROVIDED that in no event shall the number of shares represented
by the certificate(s) in the possession of the Administrative Agent be
less than the number of shares of Panavision Canada Holdings Inc.
pledged pursuant to the terms of this Agreement;
(b) all shares, securities, moneys or property representing a
dividend on any of the Pledged Stock, or representing a distribution or
return of capital upon or in respect of the Pledged Stock, or resulting
from a split-up, revision, reclassification or other like change of the
Pledged Stock or otherwise received in exchange therefor, and any
subscription warrants, rights or options issued to the holders of, or
otherwise in respect of, the Pledged Stock;
(c) without affecting the obligations of such Securing Party under
any provision prohibiting such action hereunder or under the Credit
Agreement, in the event of any
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consolidation or merger in which an Issuer is not the surviving
corporation, all shares of each class of the capital stock of the
successor corporation (unless such successor corporation is such
Securing Party itself) formed by or resulting from such consolidation or
merger (the Pledged Stock, together with all other certificates, shares,
securities, properties or moneys as may from time to time be pledged
hereunder pursuant to clause (a) or (b) above and this clause (c) being
herein collectively called the "STOCK COLLATERAL");
(d) all partnership interests held by such Securing Party (other
than, in the case of Panavision U.K. Holdings, Inc., the limited
partnership interest in Panavision U.K. L.P. held by it), all
certificates (if any) representing or evidencing such partnership
interests (including, without limitation, the certificates, if any,
identified in Annex 1 hereto under the name of such Securing Party, and
all of the rights of such Securing Party under any partnership agreement
to which such Securing Party is a party (including, without limitation,
all right, title and interest (if any) of such Securing Party as a
limited or general partner, as the case may be, to participate in the
operation or management of the partnership and all rights of such
Securing Party to the property, assets, partnership interests and
distributions under such partnership agreement), and all present and
future rights of such Securing Party to receive payment of money or
other distributions or payments arising out of or in connection with any
limited or general partnership interest of such Securing Party, as the
case may be (such partnership interests, certificates and rights herein
called collectively "PARTNERSHIP COLLATERAL";
(e) all accounts and, subject to Section 5.04(c) hereof, general
intangibles (each as defined in the Uniform Commercial Code) of such
Securing Party constituting any right to the payment of money, including
(but not limited to) all moneys due and to become due to such Securing
Party in respect of any loans or advances or for Inventory or Equipment
or other goods sold or leased or for services rendered, all moneys due
and to become due to such Securing Party under any guarantee (including
a letter of credit) of the purchase price of Inventory or Equipment sold
by such Securing Party and all tax refunds (such accounts, general
intangibles and moneys due and to become due being herein called
collectively "ACCOUNTS");
(f) all instruments, chattel paper or letters of credit (each as
defined in the Uniform Commercial Code) of such Securing Party
evidencing, representing, arising from or existing in respect of,
relating to, securing or
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otherwise supporting the payment of, any of the Accounts, including (but
not limited to) promissory notes, drafts, bills of exchange and trade
acceptances (herein collectively called "INSTRUMENTS");
(g) all inventory (as defined in the Uniform Commercial Code) of
such Securing Party, fuel, tires and other spare parts, all goods
obtained by such Securing Party in exchange for such inventory, and any
products made or processed from such inventory including all substances,
if any, commingled therewith or added thereto (herein collectively
called "INVENTORY");
(h) all Intellectual Property and all other accounts or general
intangibles of such Securing Party not constituting Intellectual
Property or Accounts;
(i) all equipment (as defined in the Uniform Commercial Code) of
such Securing Party, including all Motor Vehicles (herein collectively
called "EQUIPMENT");
(j) subject to Section 5.04(c) hereof, each contract and other
agreement of such Securing Party relating to the sale or other
disposition of Inventory or Equipment;
(k) all documents of title (as defined in the Uniform Commercial
Code) or other receipts of such Securing Party covering, evidencing or
representing Inventory or Equipment (herein collectively called
"DOCUMENTS");
(l) all rights, claims and benefits of such Securing Party against
any Person arising out of, relating to or in connection with Inventory
or Equipment purchased by such Securing Party, including, without
limitation, any such rights, claims or benefits against any Person
storing or transporting such Inventory or Equipment;
(m) the balance from time to time in the Collateral Account; and
(n) all proceeds, products, offspring, accessions, rents, profits,
income, benefits, substitutions and replacements of and to any of the
property of such Securing Party described in the preceding clauses of
this Section 3 (including, without limitation, any proceeds of insurance
thereon and all causes of action, claims and warranties now or hereafter
held by any Securing Party in respect of any of the items listed above)
and, to the extent related to any property described in said clauses or
such proceeds, products and accessions, all books, correspondence,
credit files, records, invoices and other papers, including without
limitation all tapes, cards, computer runs and other papers
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and documents in the possession or under the control of such Securing
Party or any computer bureau or service company from time to time acting
for such Securing Party.
Section 4. CASH PROCEEDS OF COLLATERAL.
4.01 COLLATERAL ACCOUNT.
(a) There is hereby established with the Administrative Agent a
cash collateral account (the "COLLATERAL ACCOUNT") in the name and under the
control of the Administrative Agent into which there shall be deposited from
time to time the cash proceeds of any of the Collateral and any other cash
proceeds of insurance, condemnation award or other compensation in respect of
any Casualty Event affecting any Property of any Securing Party (whether
received by the Administrative Agent or by any Securing Party) required to be
delivered to the Administrative Agent pursuant hereto and into which the
Securing Parties may from time to time deposit any additional amounts that
any of them wishes to pledge to the Administrative Agent for the benefit of
the Lenders as additional collateral security hereunder. The balance from
time to time in the Collateral Account shall constitute part of the
Collateral hereunder and shall not constitute payment of the Secured
Obligations until applied as hereinafter provided.
(b) Without limiting the generality of the provisions of the
foregoing paragraph (a), promptly following the occurrence of any Casualty
Event affecting the Property of any Securing Party (whether or not such
Property is Collateral under this Agreement) resulting in a loss in excess of
$500,000, such Securing Party through the Borrower shall give prompt notice
thereof to the Administrative Agent and shall cause the proceeds of
insurance, condemnation award or other compensation received as a result of
such Casualty Event to be paid to the Administrative Agent, for deposit into
the Collateral Account, as additional collateral security for the payment of
the Secured Obligations. To the extent the Administrative Agent shall
receive proceeds of any such Casualty Event resulting in a loss of $500,000
or less, the Administrative Agent will, so long as no Event of Default shall
have occurred and be continuing, promptly remit such proceeds to the relevant
Securing Party through the Borrower.
(c) The balance from time to time in the Collateral Account shall
be subject to withdrawal only as provided in this paragraph (c) and paragraph
(d) below. The Administrative Agent shall (except as otherwise provided in
the last sentence of this paragraph (c)) remit the collected balance
outstanding to the credit of the Collateral Account to or upon the order of
the relevant Securing Party as such Securing Party through the
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Borrower shall from time to time instruct, PROVIDED that (i) deposits in the
Collateral Account that constitute any proceeds of insurance, condemnation
award or other compensation in respect of any Casualty Event affecting any
Property of any Securing Party shall be subject to withdrawal only as
provided in paragraph (d) below and (ii) at any time following the occurrence
and during the continuance of an Event of Default, the Administrative Agent
may (and, if instructed by the Lenders as specified in Section 11.03 of the
Credit Agreement, shall) in its (or their) discretion apply or cause to be
applied (subject to collection) the balance from time to time outstanding to
the credit of the Collateral Account (regardless of the origin thereof) to
the payment of the Secured Obligations in the manner specified in Section
5.09 hereof.
(d) With respect to any proceeds that are required to be paid into
the Collateral Account pursuant to paragraph (b) above, the Borrower may, at
its option, to be exercised by delivery of notice to the Administrative Agent
within 120 days of the respective Casualty Event, elect to apply any proceeds
of insurance, condemnation award or other compensation received as a result
of such Casualty Event either: (i) to restoration, replacement or repair of
the Property affected by such Casualty Event (the "DAMAGED PROPERTY") or to
the purchase of other Property used or useful in the business of the Borrower
and its Subsidiaries; or (ii) to the prepayment of the Loans and the
reduction of the Commitments in the manner and to the extent specified in
Section 2.09(f) of the Credit Agreement. Failure of the Borrower to make
such an election within 120 days after the date of any such Casualty Event
shall constitute an election to so apply such proceeds to the prepayment of
the Loans and the reduction of the Commitments as aforesaid.
If the Borrower elects to restore, replace or repair the Damaged
Property or make such a purchase, any such proceeds (and any earnings
thereon) held in the Collateral Account shall be applied by the Borrower to
the restoration and repair of the Damaged Property and advanced to the
Borrower by the Administrative Agent in periodic installments upon compliance
by the Borrower with such reasonable conditions to disbursement as may be
imposed by the Administrative Agent, including, but not limited to,
reasonable retention amounts and receipt of lien releases.
Following the occurrence and the continuation of any Event of
Default, the Administrative Agent shall have no obligation to release any of
such proceeds to the Borrower for restoration, replacement or repair of
Damaged Property. All insurance proceeds remaining after the payment for
restoration and repair of Damaged Property pursuant to this paragraph (d)
may, at the option of the Administrative Agent, be applied to the prepayment
of the Loans and the reduction of the Commitments in
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the manner and extent specified in Section 2.09(f) of the Credit Agreement or
(if consented to by the Majority Lenders) released to the Borrower.
(e) The Administrative Agent shall be entitled at its option to
participate in any compromise, adjustment or settlement in connection with
any claims for loss, damage or destruction under any policy or policies of
insurance, in excess of $500,000, and the Securing Parties shall within 5
Business Days after request therefor reimburse the Administrative Agent for
all reasonable out-of-pocket expenses (including reasonable attorneys' fees
and disbursements) incurred by the Administrative Agent in connection with
such participation. No Securing Party shall make any compromise, adjustment
or settlement in connection with any such claim without approval of the
Administrative Agent.
4.02 INVESTMENT OF BALANCE IN COLLATERAL ACCOUNT. Amounts on
deposit in the Collateral Account shall be invested from time to time in such
Permitted Investments as the respective Securing Party through the Borrower
(or, after the occurrence and during the continuance of a Default, the
Administrative Agent) shall determine, which Permitted Investments shall be
held in the name and be under the control of the Administrative Agent,
PROVIDED that (i) at any time after the occurrence and during the continuance
of an Event of Default, the Administrative Agent may (and, if instructed by
the Lenders as specified in Section 11.03 of the Credit Agreement, shall) in
its (or their) discretion at any time and from time to time elect to
liquidate any such Permitted Investments and to apply or cause to be applied
the proceeds thereof to the payment of the Secured Obligations in the manner
specified in Section 5.09 hereof and (ii) if requested by the respective
Securing Party through the Borrower, such Permitted Investments may be held
in the name and under the control of one or more of the Lenders that is a
bank or trust company (and in that connection each Lender, pursuant to
Section 11.10 of the Credit Agreement, has agreed that such Permitted
Investments shall be held by such Lender as a collateral sub-agent for the
Administrative Agent hereunder).
4.03 COVER FOR LETTER OF CREDIT LIABILITIES. Amounts deposited
into the Collateral Account as cover for Letter of Credit Liabilities under
the Credit Agreement pursuant to Section 2.10(g) or the last paragraph of
Section 10 thereof shall be held by the Administrative Agent in a separate
sub-account (designated "Letter of Credit Liabilities Sub-Account") and all
amounts held in such sub-account shall constitute collateral security FIRST
for the Letter of Credit Liabilities outstanding from time to time and SECOND
as collateral security for the other Secured Obligations hereunder.
Section 5. FURTHER ASSURANCES; REMEDIES. In furtherance of the
grant of the pledge and security interest
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pursuant to Section 3 hereof, the Securing Parties hereby jointly and
severally agree with each Lender and the Administrative Agent as follows:
5.01 DELIVERY AND OTHER PERFECTION. Each Securing Party shall:
(a) if any of the shares, securities, certificates, moneys or
property required to be pledged by such Securing Party under clauses
(a), (b), (c) and (d) of Section 3 hereof are received by such Securing
Party, forthwith either (x) transfer and deliver to the Administrative
Agent such shares, securities or certificates so received by such
Securing Party (together with the certificates for any such shares and
securities duly endorsed in blank or accompanied by undated stock powers
duly executed in blank), all of which thereafter shall be held by the
Administrative Agent, pursuant to the terms of this Agreement, as part
of the Collateral or (y) take such other action as the Administrative
Agent shall deem necessary or appropriate to duly record the Lien
created hereunder in such shares, securities, certificates, moneys or
property in said clauses (a), (b), (c) and (d);
(b) with respect to any limited partnership interest held by any
Securing Party, execute and deliver written instructions to the
partnership to register the Lien created hereunder in such limited
partnership interest in the books and records maintained by such
partnership for such registrations and cause such partnership to execute
and deliver to the Administrative Agent a written confirmation to the
effect that the Lien created hereunder in such limited partnership
interest has been duly registered in such books and records;
(c) deliver and pledge to the Administrative Agent any and all
Instruments, endorsed and/or accompanied by such instruments of
assignment and transfer in such form and substance as the Administrative
Agent may request; PROVIDED, that so long as no Default shall have
occurred and be continuing, such Securing Party may retain for
collection in the ordinary course any Instruments received by such
Securing Party in the ordinary course of business and the Administrative
Agent shall, promptly upon request of such Securing Party through the
Borrower, make appropriate arrangements for making any Instrument
pledged by such Securing Party available to such Securing Party for
purposes of presentation, collection or renewal (any such arrangement to
be effected, to the extent deemed appropriate by the Administrative
Agent, against trust receipt or like document);
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(d) give, execute, deliver, file and/or record any financing
statement, notice, instrument, document, agreement or other papers that
may be necessary or desirable (in the judgment of the Administrative
Agent) to create, preserve, perfect or validate the security interest
granted pursuant hereto or to enable the Administrative Agent to
exercise and enforce its rights hereunder with respect to such pledge
and security interest, including, without limitation, causing any or all
of the Stock Collateral to be transferred of record into the name of the
Administrative Agent or its nominee (and the Administrative Agent agrees
that if any Stock Collateral is transferred into its name or the name of
its nominee, the Administrative Agent will thereafter promptly give to
the respective Securing Party copies of any notices and communications
received by it with respect to the Stock Collateral pledged by such
Securing Party hereunder), PROVIDED that notices to account debtors in
respect of any Accounts or Instruments shall be subject to the
provisions of clause (h) below;
(e) at any time during the continuance of an Event of Default,
upon request of the Administrative Agent, cause the Administrative Agent
to be listed as the lienholder on any certificate of title or ownership
covering any Motor Vehicle and within 120 days of such request deliver
evidence of the same to the Administrative Agent;
(f) keep full and accurate books and records relating to the
Collateral, and stamp or otherwise xxxx such books and records in such
manner as the Administrative Agent may reasonably require in order to
reflect the security interests granted by this Agreement;
(g) permit representatives of the Administrative Agent, upon
reasonable notice, at any time during normal business hours to inspect
and make abstracts from its books and records pertaining to the
Collateral, and permit representatives of the Administrative Agent to be
present at such Securing Party's place of business to receive copies of
all communications and remittances relating to the Collateral, and
forward copies of any notices or communications received by such
Securing Party with respect to the Collateral, all in such manner as the
Administrative Agent may require; and
(h) upon the occurrence and during the continuance of any Default,
upon request of the Administrative Agent, promptly notify (and such
Securing Party hereby authorizes the Administrative Agent so to notify)
each account debtor in respect of any Accounts or Instruments that such
Collateral has been assigned to the Administrative Agent hereunder, and
that any payments due or to become due in
SECURITY AGREEMENT
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respect of such Collateral are to be made directly to the Administrative
Agent;
(h) furnish to the Administrative Agent from time to time (but,
unless a Default shall have occurred and be continuing, no more
frequently than quarterly) statements and schedules further identifying
and describing the Copyright Collateral, the Patent Collateral and the
Trademark Collateral, respectively, and such other reports in connection
with the Copyright Collateral, the Patent Collateral and the Trademark
Collateral, as the Administrative Agent may reasonably request, all in
reasonable detail;
(i) promptly upon request of the Administrative Agent, following
receipt by the Administrative Agent of any statements, schedules or
reports pursuant to clause (h) above, modify this Agreement by amending
Annexes 2, 3 and/or 4 hereto, as the case may be, to include any
Copyright, Patent or Trademark that becomes part of the Collateral under
this Agreement.
5.02 OTHER FINANCING STATEMENTS AND LIENS. Except as otherwise
permitted under Section 9.06 of the Credit Agreement, without the prior
written consent of the Administrative Agent (granted with the authorization
of the Lenders as specified in Section 11.09 of the Credit Agreement), no
Securing Party shall file or suffer to be on file, or authorize or permit to
be filed or to be on file, in any jurisdiction, any financing statement or
like instrument with respect to the Collateral in which the Administrative
Agent is not named as the sole secured party for the benefit of the Lenders.
5.03 PRESERVATION OF RIGHTS. The Administrative Agent shall not
be required to take steps necessary to preserve any rights against prior
parties to any of the Collateral.
5.04 SPECIAL PROVISIONS RELATING TO CERTAIN COLLATERAL.
(a) STOCK COLLATERAL AND PARTNERSHIP COLLATERAL.
(i) (x) At all times that an Issuer is organized as a corporation
under the laws of a jurisdiction other than the United States of America or a
State thereof the relevant Securing Party will cause the Pledged Stock of
such Issuer to constitute at all times 66% (in number of votes) of the total
number of shares of each class of capital stock having ordinary voting power
for the election of the board of directors of such Issuer then outstanding
and 100% of the total number of shares of each class of all other capital
stock of such Issuer then outstanding, (y) at all times that an Issuer is
organized under the laws of
SECURITY AGREEMENT
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the United States of America or a State thereof the relevant Securing Party
will cause the Pledged Stock to constitute at all times 100% of the total
number of shares of each class of capital stock of the Issuer then
outstanding and (z) at all times that an Issuer is organized under the laws
of the United States or any State thereof and is owned by a Person not so
organized, no such securities of such Issuer shall constitute Pledged Stock.
(ii) So long as no Event of Default shall have occurred and be
continuing, the Securing Parties shall have the right to exercise all voting,
consensual and other powers of ownership pertaining to the Stock Collateral
and the Partnership Collateral for all purposes not inconsistent with the
terms of this Agreement or any other Loan Document, PROVIDED that the
Securing Parties jointly and severally agree that they will not vote the
Stock Collateral or exercise any powers of ownership with respect to the
Partner Collateral in any manner that is inconsistent with the terms of this
Agreement or any other Loan Document; and the Administrative Agent shall
execute and deliver to the Securing Parties or cause to be executed and
delivered to the Securing Parties all such proxies, powers of attorney,
dividend and other orders, and all such instruments, without recourse, as the
Securing Parties may reasonably request for the purpose of enabling the
Securing Parties to exercise the rights and powers that they are entitled to
exercise pursuant to this Section 5.04(a)(ii).
(iii) If any Event of Default shall have occurred, then so long as
such Event of Default shall continue, and whether or not the Administrative
Agent or any Lender exercises any available right to declare any Secured
Obligation due and payable or seeks or pursues any other relief or remedy
available to it under applicable law or under this Agreement, the Credit
Agreement or any other Loan Document relating to such Secured Obligation, all
dividends and other distributions on the Stock Collateral and the Partnership
Collateral shall be paid directly to the Administrative Agent and retained by
it in the Collateral Account as part of the Stock Collateral or the
Partnership Collateral, as the case may be, subject to the terms of this
Agreement, and, if the Administrative Agent shall so request in writing, the
Securing Parties jointly and severally agree to execute and deliver to the
Administrative Agent appropriate additional dividend, distribution and other
orders and documents to that end, PROVIDED that if such Event of Default is
cured, any such dividend or distribution theretofore paid to the
Administrative Agent shall, upon request of the Securing Parties (except to
the extent theretofore applied to the Secured Obligations), be returned by
the Administrative Agent to the Securing Parties.
SECURITY AGREEMENT
- 17 -
(b) INTELLECTUAL PROPERTY.
(i) For the purpose of enabling the Administrative Agent to
exercise rights and remedies under Section 5.05 hereof at such time as the
Administrative Agent shall be lawfully entitled to exercise such rights and
remedies, and for no other purpose, each Securing Party hereby grants to the
Administrative Agent, to the extent assignable, an irrevocable, non-exclusive
license (exercisable without payment of royalty or other compensation to such
Securing Party) to use, assign, license or sublicense any of the Intellectual
Property now owned or hereafter acquired by such Securing Party, wherever the
same may be located, including in such license reasonable access to all media
in which any of the licensed items may be recorded or stored and to all
computer programs used for the compilation or printout thereof.
(ii) Notwithstanding anything contained herein to the contrary,
but subject to the provisions of Section 9.05 of the Credit Agreement that
limit the right of the Securing Parties to dispose of their property, so long
as no Event of Default shall have occurred and be continuing, the Securing
Parties will be permitted to exploit, use, enjoy, protect, license,
sublicense, assign, sell, dispose of or take other actions with respect to
the Intellectual Property in the ordinary course of the business of the
Securing Parties. In furtherance of the foregoing, unless an Event of
Default shall have occurred and be continuing the Administrative Agent shall
from time to time, upon the request of the respective Securing Party through
the Borrower, execute and deliver any instruments, certificates or other
documents, in the form so requested, that such Securing Party through the
Borrower shall have certified are appropriate (in their judgment) to allow
them to take any action permitted above (including relinquishment of the
license provided pursuant to clause (i) immediately above as to any specific
Intellectual Property). Further, upon the payment in full of all of the
Secured Obligations and cancellation or termination of the Commitments and
Letter of Credit Liabilities or earlier expiration of this Agreement or
release of the Collateral, the Administrative Agent shall grant back to the
Securing Parties the license granted pursuant to clause (i) immediately
above. The exercise of rights and remedies under Section 5.05 hereof by the
Administrative Agent shall not terminate the rights of the holders of any
licenses or sublicenses theretofore granted by the Securing Parties in
accordance with the first sentence of this clause (ii).
SECURITY AGREEMENT
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(c) Notwithstanding the provisions of Section 3 hereof, the grant
of a security interest contained therein shall not extend to, and the
Collateral shall not include, (I) any chattel paper and general intangibles
or contract rights which are now or hereafter held by a Securing Party as
licensee, lessee or otherwise, to the extent that (a) such chattel paper,
general intangible or contract right is not assignable or capable of being
encumbered as a matter of law or under the terms of the license, lease or
other agreement applicable thereto (but solely to the extent that any such
restriction shall be enforceable under applicable law), without the consent
of the licensor or lessor or other applicable party thereto and (b) such
consent has not been obtained; provided, however, that the Collateral shall
extend to and include (i) any and all proceeds of such chattel paper, general
intangible or contract right to the extent that the assignment or encumbering
of such proceeds is not so restricted and (ii) upon any such licensor, lessor
or other applicable party's consent with respect to any such otherwise
excluded chattel paper, general intangible or contract right being obtained,
such chattel paper, general intangible and contract right and any proceeds
thereof that might theretofore have been excluded from such grant of security
interest contained in Section 3 hereof and the Collateral.
5.05 EVENTS OF DEFAULT, ETC. During the period during which an
Event of Default shall have occurred and be continuing:
(a) each Securing Party shall, at the request of the
Administrative Agent, assemble the Collateral owned by it at such place
or places, reasonably convenient to both the Administrative Agent and
such Securing Party, designated in its request;
(b) the Administrative Agent may make any reasonable compromise or
settlement deemed desirable with respect to any of the Collateral and
may extend the time of payment, arrange for payment in installments, or
otherwise modify the terms of, any of the Collateral;
(c) the Administrative Agent shall have all of the rights and
remedies with respect to the Collateral of a secured party under the
Uniform Commercial Code (whether or not said Code is in effect in the
jurisdiction where the rights and remedies are asserted) and such
additional rights and remedies to which a secured party is entitled
under the laws in effect in any jurisdiction where any rights and
remedies hereunder may be asserted, including, without limitation, the
right, to the maximum extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to the Collateral as
if the Administrative Agent were the sole and absolute owner
SECURITY AGREEMENT
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thereof (and each Securing Party agrees to take all such action as may
be appropriate to give effect to such right);
(d) the Administrative Agent in its discretion may, in its name or
in the name of the Securing Parties or otherwise, demand, xxx for,
collect or receive any money or property at any time payable or
receivable on account of or in exchange for any of the Collateral, but
shall be under no obligation to do so; and
(e) the Administrative Agent may, upon ten Business Days' prior
written notice to the Securing Parties of the time and place, with
respect to the Collateral or any part thereof that shall then be or
shall thereafter come into the possession, custody or control of the
Administrative Agent, the Lenders or any of their respective agents,
sell, lease, assign or otherwise dispose of all or any part of such
Collateral, at such place or places as the Administrative Agent deems
best, and for cash or for credit or for future delivery (without thereby
assuming any credit risk), at public or private sale, without demand of
performance or notice of intention to effect any such disposition or of
the time or place thereof (except such notice as is required above or by
applicable statute and cannot be waived), and the Administrative Agent
or any Lender or anyone else may be the purchaser, lessee, assignee or
recipient of any or all of the Collateral so disposed of at any public
sale (or, to the extent permitted by law, at any private sale) and
thereafter hold the same absolutely, free from any claim or right of
whatsoever kind, including any right or equity of redemption (statutory
or otherwise), of the Securing Parties, any such demand, notice and
right or equity being hereby expressly waived and released. In the
event of any sale, assignment, or other disposition of any of the
Trademark Collateral, the goodwill connected with and symbolized by the
Trademark Collateral subject to such disposition shall be included and
the Securing Parties shall supply to the Administrative Agent or its
designee, for inclusion in such sale, assignment or other disposition,
all Intellectual Property relating to such Trademark Collateral. The
Administrative Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to
time by announcement at the time and place fixed for the sale, and such
sale may be made at any time or place to which the sale may be so
adjourned.
The proceeds of each collection, sale or other disposition under this Section
5.05, including by virtue of the exercise of the license granted to the
Administrative Agent in Section 5.04(b) hereof, shall be applied in
accordance with Section 5.09 hereof.
SECURITY AGREEMENT
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The Securing Parties recognize that, by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, and
applicable state securities laws, the Administrative Agent may be compelled,
with respect to any sale of all or any part of the Collateral, to limit
purchasers to those who will agree, among other things, to acquire the
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. The Securing Parties acknowledge that any
such private sales may be at prices and on terms less favorable to the
Administrative Agent than those obtainable through a public sale without such
restrictions, and, notwithstanding such circumstances, agree that any such
private sale shall be deemed to have been made in a commercially reasonable
manner and that the Administrative Agent shall have no obligation to engage
in public sales and no obligation to delay the sale of any Collateral for the
period of time necessary to permit the respective Issuer or issuer thereof to
register it for public sale.
5.06 DEFICIENCY. If the proceeds of sale, collection or other
realization of or upon the Collateral pursuant to Section 5.05 hereof are
insufficient to cover the costs and expenses of such realization and the
payment in full of the Secured Obligations, the Securing Parties shall remain
liable for any deficiency (in the case of any Subsidiary Guarantor, subject
to Section 6.09 of the Credit Agreement).
5.07 REMOVALS, ETC. Without at least 30 days' prior written
notice to the Administrative Agent, no Securing Party shall (i) maintain any
of its books and records with respect to the Collateral at any office or
maintain its principal place of business at any place, or permit any
Inventory or Equipment (except Inventory or Equipment leased in the ordinary
course of business to third parties) to be located anywhere, other than at
the address indicated beneath the signature of the Borrower to the Credit
Agreement or at one of the locations identified in Annex 4 hereto under its
name or in transit from one of such locations to another or (ii) change its
name, or the name under which it does business, from the name shown on the
signature pages hereto.
5.08 PRIVATE SALE. The Administrative Agent and the Lenders shall
incur no liability as a result of the sale of the Collateral, or any part
thereof, at any private sale pursuant to Section 5.05 hereof conducted in a
commercially reasonable manner. Each Securing Party hereby waives, to the
extent permitted by applicable law, any claims against the Administrative
Agent or any Lender arising by reason of the fact that the price at which the
Collateral may have been sold at such a private sale was less than the price
that might have been obtained at a public sale or was less than the aggregate
amount of the Secured Obligations, even if the Administrative Agent
SECURITY AGREEMENT
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accepts the first offer received and does not offer the Collateral to more
than one offeree.
5.09 APPLICATION OF PROCEEDS. Except as otherwise herein
expressly provided, and except as provided below in this Section 5.09, the
proceeds of any collection, sale or other realization of all or any part of
the Collateral pursuant hereto, and any other cash at the time held by the
Administrative Agent under Section 4 hereof or this Section 5, shall be
applied by the Administrative Agent:
FIRST, to the payment of the costs and expenses of such collection,
sale or other realization, including reasonable out-of-pocket costs and
expenses of the Administrative Agent and the fees and expenses of its
agents and counsel, and all expenses incurred and advances made by the
Administrative Agent in connection therewith;
NEXT, to the payment in full of the Secured Obligations, in each
case equally and ratably in accordance with the respective amounts
thereof then due and owing or as the Lenders holding the same may
otherwise agree; and
FINALLY, to the payment to the respective Securing Party, or their
respective successors or assigns, or as a court of competent
jurisdiction may direct, of any surplus then remaining.
Notwithstanding the foregoing, the proceeds of any cash or other amounts held
in the "Letter of Credit Liabilities Sub-Account" of the Collateral Account
pursuant to Section 4.03 hereof shall be applied FIRST to the Letter of
Credit Liabilities outstanding from time to time and SECOND to the other
Secured Obligations in the manner provided above in this Section 5.09.
As used in this Section 5, "PROCEEDS" of Collateral shall mean
cash, securities and other property realized in respect of, and distributions
in kind of, Collateral, including any thereof received under any
reorganization, liquidation or adjustment of debt of the Securing Parties or
any issuer of or obligor on any of the Collateral.
5.10 ATTORNEY-IN-FACT. Without limiting any rights or powers
granted by this Agreement to the Administrative Agent while no Event of
Default has occurred and is continuing, upon the occurrence and during the
continuance of any Event of Default the Administrative Agent is hereby
appointed the attorney-in-fact of each Securing Party for the purpose of
carrying out the provisions of this Section 5 and taking any action and
executing any instruments that the Administrative Agent may deem necessary or
advisable to accomplish the purposes hereof, which appointment as
attorney-in-fact is irrevocable and coupled with an interest.
SECURITY AGREEMENT
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Without limiting the generality of the foregoing, so long as the
Administrative Agent shall be entitled under this Section 5 to make
collections in respect of the Collateral, the Administrative Agent shall have
the right and power to receive, endorse and collect all checks made payable
to the order of any Securing Party representing any dividend, payment or
other distribution in respect of the Collateral or any part thereof and to
give full discharge for the same.
5.11 PERFECTION. Prior to or concurrently with the execution and
delivery of this Agreement, each Securing Party shall (i) file such financing
statements and other documents in such offices as the Administrative Agent
may request to perfect the security interests granted by Section 3 hereof,
and (ii) deliver to the Administrative Agent all certificates identified in
Annex 1 hereto, accompanied by undated stock powers duly executed in blank.
5.12 TERMINATION. When all Secured Obligations shall have been
paid in full and the Commitments of the Lenders under the Credit Agreement
and all Letter of Credit Liabilities shall have expired or been terminated,
this Agreement shall terminate, and the Administrative Agent shall forthwith
cause to be assigned, transferred and delivered, against receipt but without
any recourse, warranty or representation whatsoever, any remaining Collateral
and money received in respect thereof, to or on the order of the respective
Securing Party and to be released and canceled all licenses and rights
referred to in Section 5.04(b) hereof. The Administrative Agent shall also
execute and deliver to the respective Securing Party upon such termination
such confirmation of termination of Liens (which shall be addressed to other
potential lenders to a Securing Party) as may be requested by a Securing
Party (acting through the Borrower), such Uniform Commercial Code termination
statements, certificates for terminating the Liens on the Motor Vehicles and
such other documentation as shall be reasonably requested by the respective
Securing Party to effect the termination and release of the Liens on the
Collateral.
5.13 FURTHER ASSURANCES. Each Securing Party agrees that, from
time to time upon the written request of the Administrative Agent, such
Securing Party will execute and deliver such further documents and do such
other acts and things as the Administrative Agent may reasonably request in
order fully to effect the purposes of this Agreement.
SECURITY AGREEMENT
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Section 6. MISCELLANEOUS.
6.01 NO WAIVER. No failure on the part of the Administrative
Agent or any Lender to exercise, and no course of dealing with respect to,
and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by the
Administrative Agent or any Lender of any right, power or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. The remedies herein are cumulative and are not
exclusive of any remedies provided by law.
6.02 NOTICES. All notices, requests, consents and demands
hereunder shall be in writing and telecopied or delivered to the intended
recipient at its "Address for Notices" specified pursuant to Section 12.02 of
the Credit Agreement and shall be deemed to have been given at the times
specified in said Section 12.02.
6.03 EXPENSES. The Securing Parties jointly and severally agree
to reimburse each of the Lenders and the Administrative Agent for all
reasonable costs and expenses of the Lenders and the Administrative Agent
(including, without limitation, the reasonable fees and expenses of legal
counsel) in connection with (i) any Default and any enforcement or collection
proceeding resulting therefrom, including, without limitation, all manner of
participation in or other involvement with (w) performance by the
Administrative Agent of any obligations of the Securing Parties in respect of
the Collateral that the Securing Parties have failed or refused to perform,
(x) bankruptcy, insolvency, receivership, foreclosure, winding up or
liquidation proceedings, or any actual or attempted sale, or any exchange,
enforcement, collection, compromise or settlement in respect of any of the
Collateral, and for the care of the Collateral and defending or asserting
rights and claims of the Administrative Agent in respect thereof, by
litigation or otherwise, including expenses of insurance, (y) judicial or
regulatory proceedings and (z) workout, restructuring or other negotiations
or proceedings (whether or not the workout, restructuring or transaction
contemplated thereby is consummated) and (ii) the enforcement of this Section
6.03, and all such costs and expenses shall be Secured Obligations entitled
to the benefits of the collateral security provided pursuant to Section 3
hereof.
6.04 AMENDMENTS, ETC. The terms of this Agreement may be waived,
altered or amended only by an instrument in writing duly executed by each
Securing Party and the Administrative Agent (with the consent of the Lenders
as specified in Section 11.09 of the Credit Agreement). Any such amendment
or waiver shall be binding upon the Administrative Agent and each Lender,
each holder of any of the Secured Obligations and each Securing Party.
SECURITY AGREEMENT
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6.05 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the respective successors and assigns of each
Securing Party, the Administrative Agent, the Lenders and each holder of any
of the Secured Obligations (PROVIDED, however, that no Securing Party shall
assign or transfer its rights hereunder without the prior written consent of
the Administrative Agent).
6.06 CAPTIONS. The captions and section headings appearing herein
are included solely for convenience of reference and are not intended to
affect the interpretation of any provision of this Agreement.
6.07 COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart.
6.08 GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.
6.09 AGENTS AND ATTORNEYS-IN-FACT. The Administrative Agent may
employ agents and attorneys-in-fact in connection herewith and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith.
6.10 SEVERABILITY. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by
law, (i) the other provisions hereof shall remain in full force and effect in
such jurisdiction and shall be liberally construed in favor of the
Administrative Agent and the Lenders in order to carry out the intentions of
the parties hereto as nearly as may be possible and (ii) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of such provision in any other jurisdiction.
6.11 ADDITIONAL SECURING PARTIES. To the extent required by
Section 9.15(a) of the Credit Agreement, new Subsidiaries formed or acquired
by the Borrower or any of its Subsidiaries that shall constitute a
"Subsidiary" under the Credit Agreement after the date hereof shall become a
"Subsidiary Guarantor" under the Credit Agreement and a "Securing Party"
under this Agreement, by executing and delivering to the Administrative Agent
a Guarantee Assumption Agreement in the form of Exhibit E to the Credit
Agreement. Accordingly, upon the execution and delivery of any such
Guarantee Assumption Agreement by any such new Subsidiary, such new
Subsidiary shall
SECURITY AGREEMENT
- 25 -
automatically and immediately, and without any further action on the part of
any Person, become a "Securing Party" for all purposes of this Agreement, and
each of Xxxxx 0, 0, 0 xxx 0 xxxxxx xxxxx xx deemed to be supplemented in the
manner specified in said Guarantee Assumption Agreement.
SECURITY AGREEMENT
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IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to
be duly executed and delivered as of the day and year first above written.
PANAVISION INC.
By
--------------------
Title:
SUBSIDIARY GUARANTORS
PANAVISION INTERNATIONAL, L.P.
By Panavision Inc.,
its general partner
By
--------------------
Title:
KEEPCO I, INC.
By
--------------------
Title:
KEEPCO II, INC.
By
--------------------
Title:
PANAVISION U.K. HOLDINGS, INC.
By
--------------------
Title:
XXXXXX XXXXXX, INC.
By
--------------------
SECURITY AGREEMENT
- 27 -
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By
--------------------
Title:
SECURITY AGREEMENT
ANNEX 1
PLEDGED STOCK
[See Section 2(b) and (c)]
[NAME OF SECURING PARTY]
CERTIFICATE REGISTERED
ISSUER NOS. OWNER NUMBER OF SHARES
------ ----------- ---------- ----------------
[COMPLETE FOR EACH SECURING PARTY]
ANNEX 1 TO SECURITY AGREEMENT
ANNEX 2
LIST OF COPYRIGHTS, COPYRIGHT REGISTRATIONS
AND APPLICATIONS FOR COPYRIGHT REGISTRATIONS
[See Section 2(d)]
ANNEX 2 TO SECURITY AGREEMENT
ANNEX 3
LIST OF PATENTS AND PATENT APPLICATIONS
[See Section 2(d)]
ANNEX 3 TO SECURITY AGREEMENT
ANNEX 4
LIST OF TRADE NAMES, TRADEMARKS, SERVICES MARKS,
TRADEMARK AND SERVICE XXXX REGISTRATIONS AND
APPLICATIONS FOR TRADEMARK AND SERVICE XXXX REGISTRATIONS
[See Section 2(d)]
[Complete for each Securing Party:]
[NAME OF SECURING PARTY]
Application (A)
Registration (R) Registration
Xxxx Or Serial No. (S) Or Filing Date
-------------------------------------------------------
ANNEX 4 TO SECURITY AGREEMENT
ANNEX 5
LIST OF CONTRACTS, LICENSES AND OTHER AGREEMENTS
[See Section 2(d), (e) and (f)]
[Complete for each Securing Party:]
[NAME OF SECURING PARTY]
ANNEX 3 TO SECURITY AGREEMENT
ANNEX 6
LIST OF LOCATIONS
[See Section 5.07]
[Complete for each Securing Party:]
[NAME OF SECURING PARTY]
ANNEX 4 TO SECURITY AGREEMENT
EXHIBIT E
[Form of Guarantee Assumption Agreement]
GUARANTEE ASSUMPTION AGREEMENT
GUARANTEE ASSUMPTION AGREEMENT dated as of ____________ __, 199_,
by _______________________, a ______________ corporation (the "ADDITIONAL
SUBSIDIARY GUARANTOR"), in favor of THE CHASE MANHATTAN BANK, as
administrative agent for the lenders or other financial institutions or
entities party, lenders, to the Credit Agreement referred to below (in such
capacity together with its successors in such capacity, the "ADMINISTRATIVE
AGENT").
Panavision Inc., a Delaware corporation, the "Subsidiary
Guarantors" referred to therein, certain lenders named therein (the
"LENDERS"), and the Administrative Agent are parties to a Credit Agreement
dated as of June 5, 1997 (as modified and supplemented and in effect from
time to time, the "CREDIT AGREEMENT").
Pursuant to Section 9.15(a) of the Credit Agreement, the Additional
Subsidiary Guarantor hereby agrees to become a "Subsidiary Guarantor" for all
purposes of the Credit Agreement, and a "Securing Party" for all purposes of
the Security Agreement. Without limiting the generality of the foregoing,
the Additional Subsidiary Guarantor hereby, jointly and severally with the
other Subsidiary Guarantors, guarantees to each Lender and the Administrative
Agent and their respective successors and assigns the prompt payment in full
when due (whether at stated maturity, by acceleration or otherwise) of all
Guaranteed Obligations (as defined in Section 6.01 of the Credit Agreement)
in the same manner and to the same extent as is provided in Section 6 of the
Credit Agreement. In addition, the Additional Subsidiary Guarantor hereby
makes the representations and warranties set forth in Sections 8.01, 8.04,
8.05 and 8.06 of the Credit Agreement, and in Section 2 of the Security
Agreement, with respect to itself and its obligations under this Agreement
(with any reference in said Sections to the Loan Documents being deemed to
include a reference to this Agreement). In addition, Annexes 1, 2, 3 and 4
to the Security Agreement shall be deemed to be supplemented in respect of
the Additional Subsidiary Guarantor as specified in Appendix A hereto.
ANNEX 4 TO SECURITY AGREEMENT
- 2 -
IN WITNESS WHEREOF, the Additional Subsidiary Guarantor has caused
this Guarantee Assumption Agreement to be duly executed and delivered as of
the day and year first above written.
[ADDITIONAL SUBSIDIARY GUARANTOR]
By_____________________________
Title:
Accepted and Agreed:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By_________________________
Title:
GUARANTEE ASSUMPTION AGREEMENT
APPENDIX A
Supplement to Annex 1:
[To be completed]
Supplement to Annex 2:
[To be completed]
Supplement to Annex 3:
[To be completed]
Supplement to Annex 4:
[To be completed]
GUARANTEE ASSUMPTION AGREEMENT
EXHIBIT F
[Form of Confidentiality Agreement]
CONFIDENTIALITY AGREEMENT
[Date]
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Credit Agreement dated as of June 5, 1997 (the "CREDIT
AGREEMENT") between Panavision Inc. (the "BORROWER"), the
Subsidiary Guarantors party thereto, the lenders party thereto
and The Chase Manhattan Bank, as Administrative Agent.
Dear Ladies and Gentlemen:
As a Lender party to the Credit Agreement, we have agreed with the
Borrower pursuant to Section 12.12 of the Credit Agreement to use reasonable
precautions to keep confidential, except as otherwise provided therein, all
non-public information identified by the Borrower as being confidential at
the time the same is delivered to us pursuant to the Credit Agreement.
As provided in said Section 12.12, we are permitted to provide you,
as a prospective [holder of a participation in the Loans (as defined in the
Credit Agreement)] [assignee Lender], with certain of such non-public
information subject to the execution and delivery by you, prior to receiving
such non-public information, of a Confidentiality Agreement in this form.
Such information will not be made available to you until your execution and
return to us of this Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you agree (on
behalf of yourself and each of your affiliates, directors, officers,
employees and representatives and for the benefit of us and each Obligor)
that (A) such information will not be used by you except in connection with
the proposed [participation] [assignment] mentioned above and (B) you shall
use reasonable precautions, in accordance with your customary procedures for
handling confidential information and in accordance with safe and sound
banking practices, to keep such information confidential, PROVIDED that
nothing herein shall limit the disclosure of any such information (i) after
such information shall have become public (other than through a violation of
Section 12.12 of the Credit Agreement), (ii) to the
GUARANTEE ASSUMPTION AGREEMENT
- 2 -
extent required by statute, rule, regulation or judicial process, (iii) to
your counsel or to counsel for any of the Lenders or the Administrative
Agent, (iv) to bank examiners (or any other regulatory authority having
jurisdiction over you or any Lender or the Administrative Agent), or to
auditors or accountants, (v) to the Administrative Agent or any other Lender
(or to Chase Securities, Inc.), (vi) in connection with any litigation to
which you or any one or more of the Lenders or the Administrative Agent are a
party, or in connection with the enforcement of rights or remedies under the
Credit Agreement or under any other Loan Document, (vii) to a subsidiary or
affiliate of yours as provided in Section 12.12(a) of the Credit Agreement or
(viii) to any assignee or participant (or prospective assignee or
participant) so long as such assignee or participant (or prospective assignee
or participant) first executes and delivers to you a Confidentiality
Agreement substantially in the form hereof; PROVIDED, FURTHER, that in no
event shall you be obligated to return any materials furnished to you
pursuant to this Confidentiality Agreement.
If you are a prospective assignee, your obligations under this
Confidentiality Agreement shall be superseded by Section 12.12 of the Credit
Agreement on the date upon which you become a Lender under the Credit
Agreement pursuant to Section 12.06(b) thereof.
Please indicate your agreement to the foregoing by signing as
provided below the enclosed copy of this Confidentiality Agreement and
returning the same to us.
Very truly yours,
[INSERT NAME OF LENDER]
By_________________________
The foregoing is agreed to
as of the date of this letter.
[INSERT NAME OF PROSPECTIVE
PARTICIPANT OR ASSIGNEE]
By_________________________
CONFIDENTIALITY AGREEMENT
EXHIBIT G
[Form of Assignment and Acceptance]
Reference is made to the Credit Agreement dated as of June 5, 1997,
as amended, supplemented or otherwise modified from time to time (the "CREDIT
AGREEMENT"), among Panavision Inc. (the "BORROWER"), each of the subsidiary
guarantors party thereto (each a "SUBSIDIARY GUARANTOR", and, collectively,
the "SUBSIDIARY GUARANTORS" and, together with the Borrower, the "OBLIGORS"),
each of the lenders party thereto (each a "LENDER", and, collectively, the
"LENDERS"), and The Chase Manhattan Bank, as administrative agent for the
Lenders (in such capacity, the "ADMINISTRATIVE AGENT"). Terms defined in the
Credit Agreement are used herein with the same meanings.
[__________] (the "ASSIGNOR") and [___________] (the "ASSIGNEE")
agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the
Assignee without recourse to the Assignor, and the Assignee hereby
irrevocably purchases and assumes from the Assignor without recourse to the
Assignor, as of the Effective Date set forth in Schedule 1 hereto (the
"EFFECTIVE DATE"), an interest (the "ASSIGNED INTEREST") in and to the
Assignor's rights and obligations under the Credit Agreement with respect to
those credit facilities contained in the Credit Agreement as set forth on
Schedule 1 (individually, an "ASSIGNED FACILITY"; collectively, the "ASSIGNED
FACILITIES"), in a principal amount and percentage for each Assigned Facility
as set forth on Schedule 1.
2. The Assignor (i) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement, the other
Loan Documents or any other instrument or document furnished pursuant
thereto, or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, the other Loan Documents or any
other instrument or document furnished pursuant thereto, other than that it
has not created any adverse claim upon the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim; (ii)
makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Borrower, any of its Subsidiaries
or any other obligor or the performance or observance by the Borrower, any of
its Subsidiaries or any other obligor of any of their respective obligations
under the Credit Agreement, any other Loan Document or any other instrument
or document or any other instrument or document furnished pursuant hereto or
thereto; and (iii) attaches the promissory note(s), if
CONFIDENTIALITY AGREEMENT
- 2 -
any, held by it evidencing the Assigned Facilities and requests that the
Administrative Agent exchange such promissory note(s), if any, for a new
promissory note or new promissory notes, as the case may be, payable to the
Assignor (if the Assignor has retained any interest in the Assigned Facility)
and a new promissory note or new promissory notes, as the case may be,
payable to the Assignee in the respective amounts which reflect the
assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date).
3. The Assignee (i) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (ii) confirms that
it has received a copy of the Credit Agreement, together with copies of the
financial statements delivered pursuant to Sections [9.01(b) and (c)]
thereof, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (iii) agrees that it will, independently and
without reliance upon the Assignor, the Administrative Agent or any other
Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking
or not taking action under the Credit Agreement, the other Loan Documents or
any other instrument or document furnished pursuant hereto or thereto; (iv)
appoints and authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement, the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto as are delegated to the Administrative Agent by the terms
thereof, together with such powers as are incidental thereto; and (v) agrees
that it will be bound by the provisions of the Credit Agreement and will
perform in accordance with its terms all the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Lender.
4. Following the execution of this Assignment and Acceptance, it
will be delivered to the Administrative Agent for acceptance by it and
recording by the Administrative Agent pursuant to Section 12.06(b) of the
Credit Agreement, effective as of the Effective Date which date shall not,
unless otherwise agreed to by the Administrative Agent, be earlier than five
Business Days after the date of such acceptance and recording by the
Administrative Agent and shall in no event be earlier than the date the
information contained herein is recorded in the Register pursuant to Section
12.06(b) of the Credit Agreement).
5. Upon such acceptance and recording, from and after the
Effective Date, the Administrative Agent shall make all payments in respect
of the Assigned Interest (including payments of principal, interest, fees and
other amounts) to the Assignee
FORM OF ASSIGNMENT AND ACCEPTANCE
- 3 -
whether such amounts have accrued prior to the Effective Date or accrue
subsequent to the Effective Date.
6. From and after the Effective Date, (i) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder and
under the other Loan Documents and shall be bound by the provisions thereof
and (ii) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under
the Credit Agreement except as provided in Section 12.07 of the Credit
Agreement.
7. This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
and Acceptance to be executed on Schedule 1 hereto by their respective duly
authorized officers.
FORM OF ASSIGNMENT AND ACCEPTANCE
Schedule 1 to
Assignment and Acceptance
relating to the Credit Agreement, dated as of June 5, 1997,
among Panavision Inc., as Borrower,
the Lenders named therein and The Chase Manhattan Bank,
as administrative agent for the Lenders
(in such capacity, the "Administrative Agent")
Name of Assignor: _______________
Name of Assignee: _______________
Effective Date of
Assignment: _______________
Principal Amount Percentage of
Assigned Facility Assigned Aggregate Commitment
----------------- ---------------- --------------------
[ASSIGNOR] [ASSIGNEE]
By_______________________ By________________________
Title: Title:
FORM OF ASSIGNMENT AND ACCEPTANCE
- 2 -
[Consented to and] Accepted:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By_________________________
Title:
[Consented to:
PANAVISION INC.(1)
By_________________________
Title:]
[Consented to:
XXX XXXXX XXXXXXXXX XXXX,(0)
as Issuing Lender
By_________________________
Title:]
------------------------
(1) If required by 12.06(b) of the Credit Agreement.
(2) If required by 12.06(b) of the Credit Agreement.
FORM OF ASSIGNMENT AND ACCEPTANCE
