EXHIBIT 10.21
CREDIT AGREEMENT
DATED AS OF OCTOBER 31, 1996
AMONG
XXXXXXXXX TECHNOLOGIES CORPORATION
AND
CERTAIN OF ITS SUBSIDIARIES THAT ARE PARTY HERETO,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
ARRANGED BY
BA SECURITIES, INC.
SECTION PAGE
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . . . . 1
1.01 Certain Defined Terms . . . . . . . . . . . . . . . . . . 1
1.02 Other Interpretive Provisions . . . . . . . . . . . . . 18
1.03 Accounting Principles . . . . . . . . . . . . . . . . . 19
ARTICLE II
THE CREDITS . . . . . . . . . . . 20
2.01 The Revolving Credit . . . . . . . . . . . . . . . . . . 20
2.02 Loan Accounts . . . . . . . . . . . . . . . . . . . . . 20
2.03 Procedure for Borrowing . . . . . . . . . . . . . . . . 20
2.04 Conversion and Continuation Elections . . . . . . . . . 21
2.05 Voluntary Termination or Reduction of Commitments . . . 23
2.06 Optional Prepayments . . . . . . . . . . . . . . . . . . 23
2.07 Cash Collateralization; Mandatory Prepayments of Loans . 23
2.08 Repayment . . . . . . . . . . . . . . . . . . . . . . . 23
2.09 Interest . . . . . . . . . . . . . . . . . . . . . . . . 24
2.10 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(a) Agency Fees . . . . . . . . . . . . . . . . . . . . 24
(b) Commitment Fees . . . . . . . . . . . . . . . . . . 24
2.11 Computation of Fees and Interest . . . . . . . . . . . . 25
2.12 Payments by the Companies . . . . . . . . . . . . . . . 25
2.13 Payments by the Banks to the Agent . . . . . . . . . . . 26
2.14 Sharing of Payments, etc. . . . . . . . . . . . . . . . 26
ARTICLE III
THE LETTERS OF CREDIT . . . . . . . . . 27
3.01 The Letter of Credit Subfacility . . . . . . . . . . . . 27
3.02 Issuance, Amendment and Renewal of Letters of Credit . . 28
3.03 Existing Letters of Credit; Risk Participations,
Drawings and Reimbursements . . . . . . . . . . . . . 30
3.04 Repayment of Participations . . . . . . . . . . . . . . 31
3.05 Role of the Issuing Bank . . . . . . . . . . . . . . . . 32
3.06 Obligations Absolute . . . . . . . . . . . . . . . . . . 33
3.07 Cash Collateral Pledge . . . . . . . . . . . . . . . . . 34
3.08 Letter of Credit Fees . . . . . . . . . . . . . . . . . 34
3.09 Uniform Customs and Practice . . . . . . . . . . . . . . 35
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY . . . . . 35
4.01 Taxes . . . . . . . . . . . . . . . . . . . . . . . 35
4.02 Illegality . . . . . . . . . . . . . . . . . . . . . 36
4.03 Increased Costs and Reduction of Return . . . . . . 36
4.04 Funding Losses . . . . . . . . . . . . . . . . . . . 37
4.05 Inability to Determine Rates . . . . . . . . . . . . 38
4.06 Reserves on Offshore Rate Loans . . . . . . . . . . 38
4.07 Certificates of Banks . . . . . . . . . . . . . . . 38
4.08 Survival . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE V
CONDITIONS PRECEDENT . . . . . . . . . 38
5.01 Conditions of Initial Credit Extension . . . . . . . 38
(a) Credit Agreement; Notes . . . . . . . . . . 39
(b) Resolutions; Incumbency . . . . . . . . . . 39
(c) Organization Documents; Good Standing . . . 39
(d) Legal Opinions . . . . . . . . . . . . . . . 39
(e) Certificate . . . . . . . . . . . . . . . . 39
(f) Termination of Existing Facility . . . . . . 40
(g) Other Documents . . . . . . . . . . . . . . 40
5.02 Conditions to All Credit Extensions . . . . . . . . 40
(a) Notice; Application . . . . . . . . . . . . 40
(b) Continuation of Representations and
Warranties . . . . . . . . . . . . . . . . 40
(c) No Existing Default . . . . . . . . . . . . 40
ARTICLE VI
REPRESENTATIONS AND WARRANTIES . . . . . . 41
6.01 Corporate Existence and Power . . . . . . . . . . . 41
6.02 Corporate Authorization; No Contravention . . . . . 41
6.03 Governmental Authorization . . . . . . . . . . . . . 41
6.04 Binding Effect . . . . . . . . . . . . . . . . . . . 41
6.05 Litigation . . . . . . . . . . . . . . . . . . . . . 42
6.06 No Default . . . . . . . . . . . . . . . . . . . . . 42
6.07 ERISA Compliance . . . . . . . . . . . . . . . . . . 42
6.08 Use of Proceeds; Margin Regulations . . . . . . . . 43
6.09 Title to Properties . . . . . . . . . . . . . . . . 43
6.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . 43
6.11 Financial Condition . . . . . . . . . . . . . . . . 43
6.12 Environmental Matters . . . . . . . . . . . . . . . 43
6.13 Regulated Entities . . . . . . . . . . . . . . . . . 44
6.14 No Burdensome Restrictions . . . . . . . . . . . . . 44
6.15 Copyrights, Patents, Trademarks and Licenses, etc. . 44
6.16 Subsidiaries . . . . . . . . . . . . . . . . . . . . 44
6.17 Insurance . . . . . . . . . . . . . . . . . . . . . 44
6.18 Swap Obligations . . . . . . . . . . . . . . . . . . 44
6.19 Full Disclosure . . . . . . . . . . . . . . . . . . 45
ARTICLE VII
AFFIRMATIVE COVENANTS . . . . . . . . . . . 45
7.01 Financial Statements . . . . . . . . . . . . . . . . 45
7.02 Certificates; Other Information . . . . . . . . . . 46
7.03 Notices . . . . . . . . . . . . . . . . . . . . . . 46
7.04 Preservation of Corporate and
Partnership Existence, etc. . . . . . . . . . . . 47
7.05 Maintenance of Property . . . . . . . . . . . . . . 48
7.06 Insurance . . . . . . . . . . . . . . . . . . . . . 48
7.07 Payment of Obligations . . . . . . . . . . . . . . . 48
7.08 Compliance with Laws . . . . . . . . . . . . . . . . 49
7.09 Inspection of Property and Books and Records . . . . 49
7.10 Environmental Laws . . . . . . . . . . . . . . . . . 49
7.11 Use of Proceeds . . . . . . . . . . . . . . . . . . 49
ARTICLE VIII
NEGATIVE COVENANTS . . . . . . . . . 49
8.01 Limitation on Liens . . . . . . . . . . . . . . . . 49
8.02 Disposition of Assets . . . . . . . . . . . . . . . 51
8.03 Consolidations and Mergers . . . . . . . . . . . . . 52
8.04 Loans and Investments . . . . . . . . . . . . . . . 52
8.05 Limitation on Indebtedness . . . . . . . . . . . . . 53
8.06 Transactions with Affiliates . . . . . . . . . . . . 54
8.07 Use of Proceeds . . . . . . . . . . . . . . . . . . 54
8.08 Contingent Obligations . . . . . . . . . . . . . . . 55
8.09 [Intentionally omitted.] . . . . . . . . . . . . . . 55
8.10 Restricted Payments . . . . . . . . . . . . . . . . 55
8.11 ERISA . . . . . . . . . . . . . . . . . . . . . . . 55
8.12 Change in Business . . . . . . . . . . . . . . . . . 56
8.13 Change in Fiscal Year . . . . . . . . . . . . . . . 56
8.14 [Intentionally omitted.] . . . . . . . . . . . . . . 56
8.15 Minimum Consolidated Net Worth . . . . . . . . . . . 56
8.16 Maximum Leverage Ratio . . . . . . . . . . . . . . . 56
8.17 Minimum Fixed Charge Coverage Ratio . . . . . . . . 56
ARTICLE IX
EVENTS OF DEFAULT . . . . . . . . 57
9.01 Event of Default . . . . . . . . . . . . . . . . . . 57
(a) Non-Payment . . . . . . . . . . . . . . . . 57
(b) Representation or Warranty . . . . . . . . . 57
(c) Specific Defaults . . . . . . . . . . . . . 57
(d) Other Defaults . . . . . . . . . . . . . . . 57
(e) Cross-Default . . . . . . . . . . . . . . . 57
(f) Insolvency; Voluntary Proceedings . . . . . 58
(g) Involuntary Proceedings . . . . . . . . . . 58
(h) ERISA . . . . . . . . . . . . . . . . . . . 58
(i) Monetary Judgments . . . . . . . . . . . . . 58
(j) Non-Monetary Judgments . . . . . . . . . . . 59
(k) Change of Control . . . . . . . . . . . . . 59
(l) Loss of Licenses . . . . . . . . . . . . . . 59
(m) Adverse Change . . . . . . . . . . . . . . . 59
(n) Guarantor Defaults . . . . . . . . . . . . . 59
9.02 Remedies . . . . . . . . . . . . . . . . . . . . . . 59
9.03 Rights Not Exclusive . . . . . . . . . . . . . . . . 60
9.04 Certain Financial Covenant Defaults . . . . . . . . 60
ARTICLE X
THE AGENT . . . . . . . . . . . . 60
10.01 Appointment and Authorization; "Agent" . . . . . . . 60
10.02 Delegation of Duties . . . . . . . . . . . . . . . . 61
10.03 Liability of Agent . . . . . . . . . . . . . . . . . 61
10.04 Reliance by Agent . . . . . . . . . . . . . . . . . 61
10.05 Notice of Default . . . . . . . . . . . . . . . . . 62
10.06 Credit Decision . . . . . . . . . . . . . . . . . . 62
10.07 Indemnification of Agent . . . . . . . . . . . . . . 63
10.08 Agent in Individual Capacity . . . . . . . . . . . . 63
10.09 Successor Agent . . . . . . . . . . . . . . . . . . 63
10.10 Withholding Tax . . . . . . . . . . . . . . . . . . 64
ARTICLE XI
MISCELLANEOUS . . . . . . . . . . . 65
11.01 Amendments and Waivers . . . . . . . . . . . . . . . 65
11.02 Notices . . . . . . . . . . . . . . . . . . . . . . 66
11.03 No Waiver; Cumulative Remedies . . . . . . . . . . . 66
11.04 Costs and Expenses . . . . . . . . . . . . . . . . . 67
11.05 Indemnity . . . . . . . . . . . . . . . . . . . . . 67
(a) General Indemnity . . . . . . . . . . . . . 67
(b) Environmental Indemnity . . . . . . . . . . 68
(c) Survival; Defense . . . . . . . . . . . . . 68
(d) Existing Indemnification Rights . . . . . . 68
11.06 Payments Set Aside . . . . . . . . . . . . . . . . . 68
11.07 Successors and Assigns . . . . . . . . . . . . . . . 69
11.08 Assignments, Participations, etc. . . . . . . . . . 69
11.09 Confidentiality . . . . . . . . . . . . . . . . . . 70
11.10 Set-off. . . . . . . . . . . . . . . . . . . . . . . 71
11.11 [Intentionally Omitted] . . . . . . . . . . . . . . 71
11.12 Notification of Addresses, Lending Offices, etc. . . 71
11.13 Termination of the Facility A Commitment
under Existing Facility . . . . . . . . . . . . . 71
11.14 Counterparts . . . . . . . . . . . . . . . . . . . . 72
11.15 Severability . . . . . . . . . . . . . . . . . . . . 72
11.16 No Third Parties Benefited . . . . . . . . . . . . . 72
11.17 Governing Law and Jurisdiction . . . . . . . . . . . 72
11.18 Waiver of Jury Trial . . . . . . . . . . . . . . . . 72
11.19 Guaranty . . . . . . . . . . . . . . . . . . . . . . 73
(a) Guaranty . . . . . . . . . . . . . . . . . . 73
(b) Separate Obligation . . . . . . . . . . . . 73
(c) Limitation of Guaranty . . . . . . . . . . . 74
(d) Liability of Guarantor . . . . . . . . . . . 74
(e) Consents of Guarantor . . . . . . . . . . . 75
(f) Guarantor's Waivers . . . . . . . . . . . . 76
(g) Financial Condition of Borrower . . . . . . 77
(h) Subrogation . . . . . . . . . . . . . . . . 77
(i) Subordination . . . . . . . . . . . . . . . 77
(j) Continuing Guaranty . . . . . . . . . . . . 78
(k) Reinstatement . . . . . . . . . . . . . . . 78
(l) Substantial Benefits . . . . . . . . . . . . 79
(m) Knowing and Explicit Waivers . . . . . . . . 79
11.20 Entire Agreement . . . . . . . . . . . . . . . . . . 80
SCHEDULES
2.01 Commitments
3.03 Existing Letters of Credit
6.05 Litigation
6.07 ERISA
6.11 Permitted Liabilities
6.12 Environmental Matters
6.16 Subsidiaries and Minority Interests
6.17 Insurance Matters
8.01(a) Permitted Liens
8.05(b) Permitted Indebtedness
8.08(c) Contingent Obligations
11.02 Lending Offices; Addresses for Notices
EXHIBITS
A Form of Notice of Borrowing
B Form of Notice of Conversion/Continuation
C Form of Compliance Certificate
D Form of Legal Opinion of Companies Counsel
E Form of Assignment and Acceptance
F Form of Promissory Note
CREDIT AGREEMENT
----------------
This CREDIT AGREEMENT is entered into as of October 31, 1996, by
and among XXXXXXXXX TECHNOLOGIES CORPORATION, a Delaware corporation
(hereinafter referred to as "Esterline"); the Subsidiaries of Esterline
listed on the signature pages hereof (together with Esterline,
collectively, the "Companies" and each individually, a "Company"); the
several financial institutions party to this Agreement (collectively
called the "Banks" and individually called a "Bank"), and BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as the Issuing Bank (as
defined below) and as agent for itself, the Banks and the Issuing Bank
(in such capacity, the "Agent").
WHEREAS, each of the Companies (i) has requested the Banks to make
available to it Loans (as hereinafter defined) on a committed revolving
loan basis from time to time in an aggregate principal amount for all
of the Companies not to exceed at any time outstanding the aggregate
total of the Commitments (as hereinafter defined) as in effect from
time to time, and (ii) has requested the Issuing Bank to issue Letters
of Credit (as hereinafter defined) for its account in an aggregate
amount for all of the Companies not to exceed at any time the L/C
Commitment (as hereinafter defined).
WHEREAS, the Banks have agreed severally to make available to the
Companies a revolving credit facility and the Issuing Bank has agreed
to issue the Letters of Credit, in each case upon the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties agree as
follows:
ARTICLE I
DEFINITIONS
-----------
1.01 Certain Defined Terms. The following terms have the following
meanings:
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or
indirectly, in (a) the acquisition of all or substantially all of
the assets of a Person, or of any business or division of a
Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of
any Person, or otherwise causing any Person to become a
Subsidiary, (c) the power to elect, appoint, or cause the election
or appointment of at least a majority of the members of the board
of directors or similar governing body of such Person, or (d) a
merger or consolidation or any other combination with another
Person (other than a Person that is a Subsidiary) provided that
any Company or its Subsidiary is the surviving entity.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person. A Person shall be deemed
to control another Person if the controlling Person possesses,
directly or indirectly, the power to direct or cause the direction
of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests,
partnership interests, by contract, or otherwise.
"Agent" means BofA in its capacity as agent for the Banks
hereunder, and any successor agent arising under Section 10.09.
"Agent-Related Persons" means BofA and any successor agent
arising under Section 10.09, together with their respective
Affiliates (including, in the case of BofA, the Arranger), and the
officers, directors, employees, agents and attorneys-in-fact of
such Persons and Affiliates.
"Agent's Payment Office" means the address for payments set
forth on Schedule 11.02 or such other address as the Agent may
from time to time specify.
"Agreement" means this Credit Agreement.
"Applicable Commitment Fee Percentage" means, on any date, the
per annum percentage amount set forth below based on the ratio of
Consolidated Funded Debt to EBITDA as set forth in Xxxxxxxxx'x
quarterly or annual financial statements most recently delivered
to the Agent under Section 7.01:
Consolidated Applicable Commitment
Funded Debt to EBITDA Fee Percentage
--------------------- ---------------------
Greater than or equal to 0.3750%
2.50 to 1.00
Less than 2.50 to 1.00 but 0.2500%
greater than or equal to 1.50
to 1.00
Less than 1.50 to 1.00 0.2000%
The Applicable Commitment Fee Percentage will become effective
two (2) Business Days after receipt by the Agent of the Compliance
Certificate delivered pursuant to Section 7.02(a) in connection
with the quarterly or annual financial statements most recently
delivered to the Agent under Section 7.01. In the event that such
Compliance Certificate is not timely delivered to the Agent when
required under Section 7.02(a), the Applicable Commitment Fee
Percentage will be 0.3750%, effective two (2) Business Days after
the date such Compliance Certificate was due until two (2)
Business Days after such Compliance Certificate is received by the
Agent. The initial Applicable Commitment Fee Percentage, based
upon Companies financial performance for the fiscal quarter ending
April 30, 1996, is 0.2000%.
"Applicable Margin" means, on any date:
(i) with respect to each Base Rate Loan outstanding on
such date, 0.00% per annum; and
(ii) with respect to each Offshore Rate Loan outstanding
on such date, the applicable margin (on a per annum basis) set
forth below based on the ratio of Consolidated Funded Debt to
EBITDA as set forth in Xxxxxxxxx'x quarterly or annual
financial statements most recently delivered to the Agent
under Section 7.01:
Consolidated Funded Debt to EBITDA Applicable Margin
---------------------------------- -----------------
Greater than or equal to 3.00 to 1.00 1.250%
Less than 3.00 to 1.00 but greater than or 1.000%
equal to 2.50 to 1.00
Less than 2.50 to 1.00 but greater than or 0.875%
equal to 2.00 to 1.00
Less than 2.00 to 1.00 but greater than or 0.625%
equal to 1.50 to 1.00
Less than 1.50 to 1.00 0.500%
The Applicable Margin will become effective two (2) Business
Days after receipt by the Agent of the Compliance Certificate
delivered pursuant to Section 7.02(a) in connection with the
quarterly or annual financial statements most recently delivered
to the Agent under Section 7.01. In the event that such Compliance
Certificate is not timely delivered to the Agent when required
under Section 7.02(a), the Applicable Margin will be 1.250%,
effective two (2) Business Days after the date such Compliance
Certificate was due until two (2) Business Days after such
Compliance Certificate is received by the Agent. The initial
Applicable Margin with respect to Offshore Rate Loans, based upon
Companies financial performance for the fiscal quarter ending
April 30, 1996, is 0.500%.
"Arranger" means BA Securities, Inc., a Delaware corporation.
"Assignee" has the meaning specified in Section 11.08(a).
"Attorney Costs" means and includes all fees and disbursements
of any law firm or other external counsel, the allocated cost of
internal legal services and all disbursements of internal counsel.
"Bank" has the meaning specified in the introductory clause
hereto. References to the "Banks" shall include the Issuing Bank
in its capacity as such unless the context otherwise requires. For
purposes of clarification only, to the extent that the Issuing
Bank may have any rights or obligations in addition to those of
the Banks due to its status as Issuing Bank, its status as such
will be specifically referenced.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of
1978 (11 U.S.C. SECTION101, et seq.).
"Base Rate" means, for any day, the higher of: (a) 0.50% per
annum above the most recently announced Federal Funds Rate; and
(b) the rate of interest in effect for such day as publicly
announced from time to time by BofA in San Francisco, California,
as its "reference rate." (The "reference rate" is a rate set by
BofA based upon various factors including BofA's costs and desired
return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced
at, above, or below such announced rate.)
Any change in the reference rate announced by BofA shall take
effect at the opening of business on the day specified in the
public announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the
Base Rate.
"BofA" means Bank of America National Trust and Savings
Association, a national banking association.
"Borrowing" means a borrowing hereunder consisting of Loans of
the same Type made to any Company on the same day by the Banks
under Article II, and may be a Borrowing or an L/C Borrowing and,
other than in the case of Base Rate Loans and L/C Borrowings,
having the same Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs
under Section 2.03.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banks in New York City or San
Francisco are authorized or required by law to close and, if the
applicable Business Day relates to any Offshore Rate Loan, means
such a day on which dealings are carried on in the applicable
offshore dollar interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or
any other law, rule or regulation, whether or not having the force
of law, in each case, regarding capital adequacy of any bank or of
any corporation controlling a bank.
"Cash Collateralize" means to pledge and deposit with or
deliver to the Agent, for the benefit of the Agent, the Issuing
Bank and the Banks, as collateral for the L/C Obligations, cash or
deposit account balances pursuant to documentation in form and
substance satisfactory to the Agent and the Issuing Bank (which
documents are hereby consented to by the Banks). Derivatives of
such term shall have corresponding meaning.
"Change of Control" means the occurrence of either of the
following: (a) any "person" or "group" (as such terms are used in
subsections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder), is or becomes the "beneficial owner" (as
such term is used in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a person shall be deemed to have "beneficial
ownership" of all securities that such person has the right to
acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of 30% or more
of the then outstanding voting capital stock of Esterline, or (b)
the Continuing Directors shall cease to constitute at least a
majority of the directors constituting the board of directors of
Esterline.
"Closing Date" means the date on which all conditions
precedent set forth in Section 5.01 are satisfied, made conditions
subsequent or waived by all Banks.
"Code" means the Internal Revenue Code of 1986, and
regulations promulgated thereunder.
"Commitment," as to each Bank, has the meaning specified in
Section 2.01.
"Compliance Certificate" means a certificate substantially in
the form of Exhibit C.
"Consolidated Funded Debt" means all Funded Debt of Esterline
and its Subsidiaries, determined on a consolidated basis
eliminating intercompany items.
"Consolidated Net Income" and "Consolidated Net Loss" mean,
respectively, for any period, the aggregate net income or loss for
such period of Esterline and its Subsidiaries on a consolidated
basis.
"Consolidated Net Worth" means, as of any date of
determination, Consolidated Total Assets minus Consolidated Total
Liabilities.
"Consolidated Total Assets" means, as of any date of
determination, the total assets of Esterline and its Subsidiaries
on a consolidated basis.
"Consolidated Total Liabilities" means, as of any date of
determination, the total liabilities of Esterline and its
Subsidiaries on a consolidated basis.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with
or without recourse, (a) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation (the "primary
obligations") of another Person (the "primary obligor"), including
any obligation of that Person (i) to purchase, repurchase or
otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or
discharge of any such primary obligation, or to maintain working
capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency or any balance sheet item,
level of income or financial condition of the primary obligor,
(iii) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such
primary obligation, or (iv) otherwise to assure or hold harmless
the holder of any such primary obligation against loss in respect
thereof (each, a "Guaranty Obligation"); (b) with respect to any
Surety Instrument issued for the account of that Person or as to
which that Person is otherwise liable for reimbursement of
drawings or payments; (c) to purchase any materials, supplies or
other property from, or to obtain the services of, another Person
if the relevant contract or other related document or obligation
requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of
whether delivery of such materials, supplies or other property is
ever made or tendered, or such services are ever performed or
tendered, or (d) in respect of any Swap Contract. The amount of
any Contingent Obligation shall, in the case of Guaranty
Obligations, be deemed equal to the stated or determinable amount
of the primary obligation in respect of which such Guaranty
Obligation is made or, if not stated or if indeterminable, the
maximum reasonably anticipated liability in respect thereof, and
in the case of other Contingent Obligations other than in respect
of Swap Contracts, shall be equal to the maximum reasonably
anticipated liability in respect thereof and, in the case of
Contingent Obligations in respect of Swap Contracts, shall be
equal to the Swap Termination Value.
"Continuing Directors" means, as of any date, the collective
reference to all members of the board of directors of Esterline
who assumed office after such date and whose appointment or
nomination for election by Xxxxxxxxx'x shareholders was approved
by a vote of at least 50% of the Continuing Directors in office
immediately prior to such appointment or nomination.
"Contractual Obligation" means, as to any Person, any
provision of any security issued by such Person or of any
agreement, undertaking, contract, indenture, mortgage, deed of
trust or other instrument, document or agreement to which such
Person is a party or by which it or any of its property is bound.
"Conversion/Continuation Date" means any date on which, under
Section 2.04, any Company (a) converts Loans of one Type to
another Type, or (b) continues as Loans of the same Type, but with
a new Interest Period, Loans having Interest Periods expiring on
such date.
"Credit Extension" means and includes (a) the making of any
Loans hereunder, and (b) the Issuance of any Letters of Credit
hereunder (including the Existing Letters of Credit).
"Default" means any event or circumstance which, with the
giving of notice, the lapse of time, or both, would (if not cured
or otherwise remedied during such time) constitute an Event of
Default.
"Dollars," "dollars" and "$" each mean lawful money of the
United States.
"EBIT" means, for any period, Consolidated Net Income or
Consolidated Net Loss, as the case may be, for such period, plus
the sum of (a) interest expense, and (b) income tax expense, which
were deductible in determining Consolidated Net Income or
Consolidated Net Loss of Xxxxxxxxx and its Subsidiaries on a
consolidated basis for such period.
"EBITAR" means, for any period, EBIT for such period, plus the
sum of (a) amortization expense, and (b) Rental Expense, which
were deductible in determining Consolidated Net Income or
Consolidated Net Loss of Xxxxxxxxx and its Subsidiaries on a
consolidated basis for such period.
"EBITDA" means, for any period, EBIT for such period, plus the
sum of (a) depreciation expense, (b) amortization expense and (c)
noncash items, which were deductible in determining Consolidated
Net Income or Consolidated Net Loss of Xxxxxxxxx and its
Subsidiaries on a consolidated basis for such period.
"Effective Amount" means (i) with respect to any Loans on any
date, the aggregate outstanding principal amount thereof after
giving effect to any Borrowings and prepayments or repayments
occurring on such date; and (ii) with respect to any outstanding
L/C Obligations on any date, the amount of such L/C Obligations on
such date after giving effect to any Issuances of Letters of
Credit occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including
as a result of any reimbursements of outstanding unpaid drawings
under any Letters of Credit or any reductions in the maximum
amount available for drawing under Letters of Credit taking effect
on such date.
"Eligible Assignee" means (i) a commercial bank organized
under the laws of the United States, or any state thereof, and
having a combined capital and surplus of at least $100,000,000,
(ii) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political
subdivision of any such country, and having a combined capital and
surplus of at least $100,000,000, provided that such bank is
acting through a branch or agency located in the United States or
the Cayman Islands; (iii) a Person that is primarily engaged in
the business of commercial banking and that is (A) a Subsidiary of
a Bank, (B) a Subsidiary of a Person of which a Bank is a
Subsidiary, or (C) a Person of which a Bank is a Subsidiary.
"Environmental Claims" means all claims, however asserted, by
any Governmental Authority or other Person alleging potential
liability or responsibility of any of the Companies or their
Subsidiaries for violation of any Environmental Law, or for
release or injury to the environment.
"Environmental Laws" means all federal, state, local or
foreign laws, statutes, common law duties, rules, regulations,
ordinances and codes, together with all administrative orders,
directed duties, licenses, authorizations and permits of, and
agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of
1974, and regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with any Company within the
meaning of subsection 414(b) or (c) of the Code (and Sections
414(m) and (o) of the Code for purposes of provisions relating to
Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by any Company or any ERISA
Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as
defined in Section 4001(a)(2) of ERISA) or a cessation of
operations which is treated as such a withdrawal under Section
4062(e) of ERISA; (c) a complete or partial withdrawal by any
Company or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d)
the filing of a notice of intent to terminate, the treatment of a
Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate
a Pension Plan or Multiemployer Plan; (e) an event or condition
which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer
Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon any Company or any ERISA Affiliate.
"Eurodollar Reserve Percentage" has the meaning specified in
the definition of "Offshore Rate."
"Event of Default" means any of the events or circumstances
specified in Section 9.01.
"Exchange Act" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"Existing Facility" means the Amended and Restated Credit
Agreement dated and effective as of September 18, 1989 among
Xxxxxxxxx and certain of its Subsidiaries, BofA as successor by
merger to Continental Bank, N.A. as "agent" and the several
financial institutions party thereto, as amended from time to time
in accordance with its terms.
"Existing Letters of Credit" means the letters of credit
described in Schedule 3.03.
"FDIC" means the Federal Deposit Insurance Corporation, and
any Governmental Authority succeeding to any of its principal
functions.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of
New York (including any such successor, "H.15(519)") on the
preceding Business Day opposite the caption "Federal Funds
(Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the
rates for the last transaction in overnight Federal funds arranged
prior to 9:00 a.m. (New York City time) on that day by each of
three leading brokers of Federal funds transactions in New York
City selected by the Agent.
"Fee Letter" has the meaning specified in Section 2.10(a).
"FRB" means the Board of Governors of the Federal Reserve
System, and any Governmental Authority succeeding to any of its
principal functions.
"Funded Debt" of any Person means, as of the end of each
fiscal quarter of such Person, (a) all Indebtedness of such Person
(including with respect to any Loans hereunder) for borrowed
money; (b) all noncontingent reimbursement or payment obligations
of such Person with respect to Surety Instruments; (c) all
obligations with respect to capital leases; (d) the current
portion of all obligations of such Person arising with respect to
preferred stock that is mandatorily redeemable by such Person; (e)
all indebtedness referred to in clauses (a) through (d) above
secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any
Lien upon or in property (including accounts and contracts rights)
owned by such Person, even though such Person has not assumed or
become liable for the payment of such Indebtedness; and (f) all
Guaranty Obligations in respect of indebtedness or obligations of
others of the kinds referred to in clauses (a) through (d).
"Further Taxes" means any and all present or future taxes,
levies, assessments, imposts, duties, deductions, fees,
withholdings or similar charges (including, without limitation,
net income taxes and franchise taxes), and all liabilities with
respect thereto, imposed by any jurisdiction on account of amounts
payable or paid pursuant to Section 4.01.
"GAAP" means generally accepted accounting principles set
forth from time to time in the opinions and pronouncements of the
Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board (or agencies with similar
functions of comparable stature and authority within the U.S.
accounting profession), which are applicable to the circumstances
and consistently applied.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guarantor" means each of the Companies in its capacity as a
"guarantor" under Section 11.19 of this Agreement or under any
separate agreement executed by it pursuant to which it guarantees
the Obligations.
"Guaranteed Obligations" has the meaning specified in Section
11.19.
"Guaranty Obligation" has the meaning specified in the
definition of "Contingent Obligation."
"Honor Date" has the meaning specified in Section 3.03(c).
"Indebtedness" of any Person means, without duplication, (a)
all indebtedness for borrowed money; (b) all obligations issued,
undertaken or assumed as the deferred purchase price of property
or services (other than trade payables entered into in the
ordinary course of business on ordinary terms); (c) all
noncontingent reimbursement or payment obligations with respect to
Surety Instruments; (d) all obligations evidenced by notes, bonds,
debentures or similar instruments, including obligations so
evidenced incurred in connection with the acquisition of property,
assets or businesses; (e) all indebtedness created or arising
under any conditional sale or other title retention agreement, or
incurred as financing, in either case with respect to property
acquired by the Person (even though the rights and remedies of the
seller or bank under such agreement in the event of default are
limited to repossession or sale of such property); (f) all
obligations with respect to capital leases; (g) all indebtedness
referred to in clauses (a) through (f) above secured by (or for
which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon or in
property (including accounts and contracts rights) owned by such
Person, even though such Person has not assumed or become liable
for the payment of such Indebtedness; and (h) all Guaranty
Obligations in respect of indebtedness or obligations of others of
the kinds referred to in clauses (a) through (g) above.
For all purposes of this Agreement, the Indebtedness of any
Person shall include all recourse Indebtedness of any partnership
or joint venture or limited liability company in which such Person
is a general partner or a joint venturer or a member.
"Indemnified Liabilities" has the meaning specified in Section
11.05.
"Indemnified Person" has the meaning specified in Section
11.05.
"Independent Auditor" has the meaning specified in Section
7.01(a).
"Insolvency Proceeding" means, with respect to any Person, (a)
any case, action or proceeding with respect to such Person before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors, or (b) any general
assignment for the benefit of creditors, composition, marshaling
of assets for creditors, or other, similar arrangement in respect
of its creditors generally or any substantial portion of its
creditors; in either event undertaken under U.S. Federal, state or
foreign law, including the Bankruptcy Code.
"Interest Payment Date" means, as to any Loan other than a
Base Rate Loan, the last day of each Interest Period applicable to
such Loan and, as to any Base Rate Loan, the last Business Day of
each calendar quarter and each date such Loan is converted into
another Type of Loan, provided, however , that if any Interest
Period for an Offshore Rate Loan exceeds three months, the date
that falls three months after the beginning of such Interest
Period and after each Interest Payment Date thereafter is also an
Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the
period commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which a Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one,
two, three or six months thereafter as selected by a Company in
its Notice of Borrowing or Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day
that is not a Business Day, that Interest Period shall be
extended to the following Business Day unless, in the case of
an Offshore Rate Loan, the result of such extension would be
to carry such Interest Period into another calendar month, in
which event such Interest Period shall end on the preceding
Business Day;
(ii) any Interest Period pertaining to an Offshore Rate
Loan that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at
the end of such Interest Period; and
(iii) no Interest Period for any Loan shall extend beyond
October 31, 2000.
"Investments" has the meaning specified in Section 8.04.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the
Code.
"Issuance Date" has the meaning specified in Section 3.01(a).
"Issue" means, with respect to any Letter of Credit, to
incorporate the Existing Letters of Credit into this Agreement, or
to issue or to extend the expiry of, or to renew or increase the
amount of, such Letter of Credit; and the terms "Issued,"
"Issuing" and "Issuance" have corresponding meanings.
"Issuing Bank" means BofA in its capacity as issuer of one or
more Letters of Credit hereunder, together with any replacement
letter of credit issuer arising under Section 10.01(b) or Section
10.09, and any other Bank which, if required for legal or credit
reasons, is willing to issue letters of credit hereunder.
"Joint Venture" means a single-purpose corporation,
partnership, limited liability company, joint venture or other
similar legal arrangement (whether created by contract or
conducted through a separate legal entity) now or hereafter formed
by any Company or any of its Subsidiaries with another Person in
order to conduct a common venture or enterprise with such Person.
"L/C Advance" means each Bank's participation in any L/C
Borrowing in accordance with its Pro Rata Share.
"L/C Amendment Application" means an application form for
amendment of outstanding standby or commercial documentary letters
of credit as shall at any time be in use at the Issuing Bank, as
the Issuing Bank shall request.
"L/C Application" means an application form for issuances of
standby or commercial documentary letters of credit as shall at
any time be in use at the Issuing Bank, as the Issuing Bank shall
request.
"L/C Borrower" means any Company for whose account a Letter of
Credit is Issued pursuant to Article III.
"L/C Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been
reimbursed on the date when made nor converted into a Borrowing
under Section 3.03(c).
"L/C Commitment" means the commitment of the Issuing Bank to
Issue, and the commitment of the Banks severally to participate
in, Letters of Credit (including the Existing Letters of Credit)
from time to time Issued or outstanding under Article III, in an
aggregate amount not to exceed on any date the amount of the
aggregate Commitments less the Effective Amount of all Loans
outstanding on such date. The L/C Commitment is a part of the
combined Commitments, rather than a separate, independent
commitment.
"L/C Obligations" means at any time the sum of (a) the
aggregate undrawn amount of all Letters of Credit then
outstanding, plus (b) the amount of all unreimbursed drawings
under all Letters of Credit, including all outstanding L/C
Borrowings.
"L/C-Related Documents" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other
document relating to any Letter of Credit, including any of the
Issuing Bank's standard form documents for letter of credit
issuances.
"Lending Office" means, as to any Bank, the office or offices
of such Bank specified as its "Lending Office" or "Domestic
Lending Office" or "Offshore Lending Office," as the case may be,
on Schedule 11.02, or such other office or offices as such Bank
may from time to time notify the Companies and the Agent.
"Letters of Credit" means the Existing Letters of Credit and
any letters of credit (whether standby letters of credit or
commercial documentary letters of credit) Issued by the Issuing
Bank pursuant to Article III.
"Leverage Ratio" means, as of any date of determination, the
ratio of (a) Consolidated Funded Debt to (b) the sum of
Consolidated Funded Debt plus Consolidated Net Worth.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement
of any kind or nature whatsoever in respect of any property
(including those created by, arising under or evidenced by any
conditional sale or other title retention agreement, the interest
of a lessor under a capital lease, any financing lease having
substantially the same economic effect as any of the foregoing, or
the filing of any financing statement naming the owner of the
asset to which such lien relates as debtor, under the UCC or any
comparable law) and any contingent or other agreement to provide
any of the foregoing, but not including the interest of a lessor
under an operating lease.
"Loan" means an extension of credit by a Bank to any Company
under Article II or Article III, and may be a Base Rate Loan, an
Offshore Rate Loan or an L/C Advance (each, a " Type" of Loan).
"Loan Documents" means this Agreement, any Notes, the Fee
Letters, the L/C Related Documents and all other documents
delivered to the Agent or any Bank in connection herewith.
"Majority Banks" means at any time Banks then holding at least
66-2/3% of the then aggregate unpaid principal amount of the
Loans, or, if no such principal amount is then outstanding, Banks
then having at least 66-2/3% of the Commitments.
"Margin Stock" means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change
in, or a material adverse effect upon, the operations, business,
properties, condition (financial or otherwise) of Xxxxxxxxx
(considering all of its assets), or of the Companies and their
Subsidiaries taken as a whole, which would be expected to result
in a material impairment of the ability of Xxxxxxxxx (considering
all of its assets), or of Xxxxxxxxx and the other Companies taken
as a whole, to perform under any Loan Document and to avoid any
Default or Event of Default; or (b) a material adverse effect upon
the legality, validity, binding effect or enforceability against
any Company or any Guarantor of any Loan Document.
"Multiemployer Plan" means a "multiple employer plan" or a
"multiemployer plan," within the meaning of Sections 4064(a) and
4001(a)(3) of ERISA, to which any Company or any ERISA Affiliate
makes, is making, or is obligated to make contributions or, during
the preceding three calendar years, has made, or been obligated to
make, contributions.
"Note" means a promissory note executed by the Companies in
favor of a Bank pursuant to Section 2.02(b), in substantially the
form of Exhibit F.
"Notice of Borrowing" means a notice in substantially the form
of Exhibit A.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means all advances, debts, liabilities,
obligations, covenants and duties and other Indebtedness arising
under any Loan Document owing by any Company to any Bank, the
Agent, or any Indemnified Person, whether direct or indirect
(including those acquired by assignment), absolute or contingent,
due or to become due, now existing or hereafter arising.
"Offshore Rate" means, for any Interest Period, with respect
to Offshore Rate Loans comprising part of the same Borrowing, the
rate of interest per annum (rounded upward to the next 1/16th of
1%) determined by the Agent as follows:
Offshore Rate = IBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Reserve Percentage" means for any day for any
Interest Period the maximum reserve percentage (expressed as a
decimal, rounded upward to the next 1/100th of 1%) in effect
on such day (whether or not applicable to any Bank) under
regulations issued from time to time by the FRB for
determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"); and
"IBOR" means the rate of interest per annum determined by
the Agent as the rate at which dollar deposits in the
approximate amount of BofA's Offshore Rate Loan for such
Interest Period would be offered by BofA's Grand Cayman
Branch, Grand Cayman B.W.I. (or such other office as may be
designated for such purpose by BofA), to major banks in the
offshore dollar interbank market at their request at
approximately 11:00 a.m. (New York City time) two Business
Days prior to the commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to
all Offshore Rate Loans then outstanding as of the effective
date of any change in the Eurodollar Reserve Percentage.
"Offshore Rate Loan" means a Loan that bears interest based on
the Offshore Rate.
"Organization Documents" means, for any corporation, the
certificate or articles of incorporation, the bylaws, any
certificate of determination or instrument relating to the rights
of preferred shareholders of such corporation, any shareholder
rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation, and for
any partnership, the partnership agreement, any other agreements
or instruments relating to the rights or the partners of such
partnership or limiting or authorizing the activities of such
partnership, and all applicable resolutions of such partnership.
"Other Taxes" means any present or future stamp, court or
documentary taxes or any other excise or property taxes (except
for the present excise tax imposed by the State of Washington know
as the business and occupations tax to the extent that it is
imposed upon the gross receipts of any Bank), charges or similar
levies which arise from any payment made hereunder or from the
execution, delivery, performance, enforcement or registration of,
or otherwise with respect to, this Agreement or any other Loan
Documents.
"Participant" has the meaning specified in Section 11.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal
functions under ERISA.
"Pension Plan" means a pension plan (as defined in Section
3(2) of ERISA) subject to Title IV of ERISA which any Company or
any ERISA Affiliate sponsors, maintains, or to which it makes, is
making, or is obligated to make contributions, or in the case of a
multiple employer plan (as described in Section 4064(a) of ERISA)
has made contributions at any time during the immediately
preceding five (5) plan years.
"Permitted Liens" has the meaning specified in Section 8.01.
"Permitted Swap Obligations" means all obligations (contingent
or otherwise) of any Company or any Subsidiary existing or arising
under Swap Contracts, provided that each of the following criteria
is satisfied: (a) such obligations are (or were) entered into by
such Person in the ordinary course of business for the purpose of
directly mitigating risks associated with liabilities, commitments
or assets held or reasonably anticipated by such Person, or
changes in the value of securities issued by such Person in
conjunction with a securities repurchase program not otherwise
prohibited hereunder, and not for purposes of speculation or
taking a "market view;" and (b) such Swap Contracts do not contain
(i) any provision ("walk-away" provision) exonerating the
nondefaulting party from its obligation to make payments on
outstanding transactions to the defaulting party, or (ii) any
provision creating or permitting the declaration of an event of
default, termination event or similar event upon the occurrence of
an Event of Default hereunder (other than an Event of Default
under Section 9.01(a).
"Person" means an individual, partnership, corporation,
limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture or Governmental
Authority.
"Plan" means an employee benefit plan (as defined in Section
3(3) of ERISA) which any Company sponsors or maintains or to which
any Company makes, is making, or is obligated to make
contributions and includes any Pension Plan.
"Pro Rata Share" means, as to any Bank at any time, the
percentage equivalent (expressed as a decimal, rounded to the
ninth decimal place) at such time of such Bank's Commitment
divided by the combined Commitments of all Banks.
"Rental Expense" means, with respect to any Person, for any
period, the aggregate amount of all rental and other obligations
(other than rentals of automobiles or equipment of one month or
less which are not renewed) required to be paid during such period
by such Person as lessee under all leases of real or personal
property, including all operating leases and capital leases, but
excluding any amount required to be paid by the lessee (whether or
not therein designated as rent or additional rent) on account of
maintenance and repairs, insurance, taxes, assessments, water
rates and similar charges, provided, that, if at the date of
determination, any such rental or other obligations (or portion
thereof) are contingent or not otherwise definitely determinable
by the terms of the related lease, the amount of such obligations
(i) shall be assumed to be equal to the amount of such obligations
for the period of the 12 consecutive calendar months immediately
preceding the date of determination or (ii) if the related lease
was not in effect during such preceding 12-month period, shall be
the amount estimated by a Responsible Officer on a reasonable
basis and in good faith.
"Reportable Event" means, any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than
any such event for which the 30-day notice requirement under ERISA
has been waived in regulations issued by the PBGC.
"Requirement of Law" means, as to any Person, any law
(statutory or common), treaty, rule or regulation or determination
of an arbitrator or of a Governmental Authority, in each case
applicable to or binding upon the Person or any of its property or
to which the Person or any of its property is subject.
"Responsible Officer" means, with respect to any Company, the
chief executive officer or the president of such Company, or any
other officer having substantially the same authority and
responsibility; or, with respect to compliance with financial
covenants, the chief financial officer or the treasurer of such
Company, or any other officer having substantially the same
authority and responsibility.
"Revolving Termination Date" means the earlier to occur of:
(a) October 31, 2000; and
(b) the date on which the Commitments terminate in
accordance with the provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal
functions.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other
business entity of which more than 50% of the voting stock,
membership interests or other equity interests (in the case of
Persons other than corporations), is owned or controlled directly
or indirectly by the Person, or one or more of the Subsidiaries of
the Person, or a combination thereof. Unless the context otherwise
clearly requires, references herein to a "Subsidiary" refer to a
Subsidiary of a Company.
"Surety Instruments" means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties,
shipside bonds, surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in
writing, relating to any transaction that is a rate swap, basis
swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap or option, bond, note or xxxx option,
interest rate option, forward foreign exchange transaction, cap,
collar or floor transaction, currency swap, cross-currency rate
swap, swaption, currency option or any other, similar transaction
(including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise
clearly requires, any master agreement relating to or governing
any or all of the foregoing.
"Swap Termination Value" means, in respect of any one or more
Swap Contracts, after taking into account the effect of any
legally enforceable netting agreement relating to such Swap
Contracts, (a) for any date on or after the date such Swap
Contracts have been closed out and termination value(s) determined
in accordance therewith, such termination value(s), and (b) for
any date prior to the date referenced in clause (a) the amount(s)
determined as the xxxx-to-market value(s) for such Swap Contracts,
as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such
Swap Contracts (which may include any Bank).
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or
similar charges, and all liabilities with respect thereto,
excluding, in the case of each Bank and the Agent, respectively,
taxes imposed on or measured by its net income or gross receipts
by the jurisdiction (or any political subdivision thereof) under
the laws of which such Bank or the Agent, as the case may be, is
organized or maintains a lending office.
"Type" has the meaning specified in the definition of "Loan."
"Unfunded Pension Liability" means the excess of a Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the
current value of that Plan's assets, determined in accordance with
the assumptions used for funding the Pension Plan pursuant to
Section 412 of the Code for the applicable plan year.
"United States" and "U.S." each means the United States of
America.
"Wholly Owned Subsidiary" means any corporation in which
(other than directors' qualifying shares required by law) 100% of
the capital stock of each class having ordinary voting power, and
100% of the capital stock of every other class, in each case, at
the time as of which any determination is being made, is owned,
beneficially and of record, by any Company, or by one or more of
the other Wholly Owned Subsidiaries, or both.
1.02 Other Interpretive Provisions. (a) The meanings of defined
terms are equally applicable to the singular and plural forms of the
defined terms.
(b) The words "hereof," "herein," "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision
of this Agreement; and subsection, Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but
excluding," and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and
(ii) references to any statute or regulation are to be construed as
including all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation
of this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are
cumulative and shall each be performed in accordance with their terms.
Unless otherwise expressly provided, any reference to any action of the
Agent or the Banks by way of consent, approval or waiver shall be
deemed modified by the phrase "in its/their sole discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the
Companies, the Banks, the Issuing Bank and the other parties, and are
the products of all parties. Accordingly, they shall not be construed
against the Banks, the Issuing Bank or the Agent merely because of the
Agent's or Banks' or the Issuing Bank's involvement in their
preparation.
1.03 Accounting Principles. (a) Unless the context otherwise
clearly requires, all accounting terms not expressly defined herein
shall be construed, and all financial computations required under this
Agreement shall be made, in accordance with GAAP; provided, that if any
change in GAAP results in a change in the operation or calculation of
any of Sections 8.15, 8.16, or 8.17 or any of the defined terms used
therein, the Companies shall promptly notify the Agent thereof and,
upon notice to Xxxxxxxxx by the Agent on behalf of the Majority Banks,
compliance with any such covenant shall be determined on the basis of
GAAP in effect immediately before the relevant change in GAAP became
effective, until either such notice is withdrawn upon instruction from
the Majority Banks or such covenant is amended in a manner satisfactory
to the Companies and the Majority Banks.
(b) References herein to "fiscal year" and "fiscal quarter" refer
to such fiscal periods of the Companies.
ARTICLE II
THE CREDITS
-----------
2.01 The Revolving Credit. Each Bank severally agrees, on the
terms and conditions set forth herein, to make loans to the Companies
from time to time on any Business Day during the period from the
Closing Date to the Revolving Termination Date, in an aggregate amount
not to exceed at any time outstanding the amount set forth on Schedule
2.01 (such amount as the same may be reduced under Section 2.05 or as a
result of one or more assignments under Section 11.08, the Bank's
"Commitment"); provided, however, that, after giving effect to any
Credit Extension, the Effective Amount of all outstanding Loans and L/C
Obligations together shall not at any time exceed the combined
Commitments. Within the limits of each Bank's Commitment, and subject
to the other terms and conditions hereof, the Company may borrow under
this Section 2.01, prepay under Section 2.06 and reborrow under this
Section 2.01.
Each of the Companies understands and agrees that the commitments
of the "Banks" under the Existing Facility to make advances under the
Existing Facility terminate, without necessity of further act of the
parties, upon execution of this Agreement by the Companies. Each of the
Companies confirms and acknowledges its obligations to pay all amounts
due under the Existing Facility, and each covenants and agrees that the
proceeds of the initial borrowings under this Agreement shall be used
to pay all principal and accrued interest (if any) and other amounts
due under the Existing Facility.
2.02 Loan Accounts. (a) The Loans made by each Bank and the
Letters of Credit Issued by the Issuing Bank shall be evidenced by one
or more accounts or records maintained by such Bank or the Issuing
Bank, as the case may be, in the ordinary course of business. The
accounts or records maintained by the Agent, each Bank and the Issuing
Bank, shall be conclusive absent manifest error of the amount of the
Loans made by the Banks to any Company and the Letters of Credit Issued
for the account of any Company, and the interest and payments thereon.
Any failure so to record or any error in doing so shall not, however,
limit or otherwise affect the obligation of any Company hereunder to
pay any amount owing with respect to the Loans or any Letter of Credit.
(b) Upon the request of any Bank made through the Agent, the Loans
made by such Bank may be evidenced by one or more Notes, instead of or
in addition to loan accounts. Each such Bank shall endorse on the
schedules annexed to its Note(s) the date, amount and maturity of each
Loan made by it and the amount of each payment of principal made by any
Company with respect thereto. Each such Bank is irrevocably authorized
by the Companies to endorse its Note(s) and each Bank's record shall be
conclusive absent manifest error; provided, however, that the failure
of a Bank to make, or an error in making, a notation thereon with
respect to any Loan shall not limit or otherwise affect the obligations
of any Company hereunder or under any such Note to such Bank.
2.03 Procedure for Borrowing. (a) Each Borrowing shall be made
upon any Company's irrevocable written notice delivered to the Agent in
the form of a Notice of Borrowing (which notice must be received by the
Agent prior to 9:00 a.m. (San Francisco time) (i) three Business Days
prior to the requested Borrowing Date, in the case of Offshore Rate
Loans; and (ii) one Business Day prior to the requested Borrowing Date,
in the case of Base Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in an
aggregate minimum amount of $5,000,000 or any multiple of
$1,000,000 in excess thereof;
(B) the requested Borrowing Date, which shall be a Business
Day;
(C) the Type of Loans comprising the Borrowing; and
(D) with respect to Offshore Rate Loans, the duration of the
Interest Period applicable to such Loans included in such notice.
If the Notice of Borrowing fails to specify the duration of the
Interest Period for any Borrowing comprised of Offshore Rate
Loans, such Interest Period shall be three months.
provided, however, that with respect to any Borrowing to be made on the
Closing Date, the Notice of Borrowing shall be delivered to the Agent
not later than 11:00 a.m. (San Francisco time) at least one Business
Day before the Closing Date and such Borrowing will consist of Base
Rate Loans only; and further provided that if so requested by the
Agent, all Borrowings during the first 60 days following the Closing
Date shall have the same Interest Period and shall be Base Rate Loans
or Offshore Rate Loans for Interest Periods no longer than one month.
(b) The Agent will promptly notify each Bank of its receipt of any
Notice of Borrowing and of the amount of such Bank's Pro Rata Share of
that Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Companies at
the Agent's Payment Office by 11:00 a.m. (San Francisco time) on the
Borrowing Date requested by the Companies in funds immediately
available to the Agent. The proceeds of all such Loans will then be
made available to the Companies by the Agent at such office by
crediting the account of the Company requesting such Borrowing on the
books of BofA with the aggregate of the amounts made available to the
Agent by the Banks and in like funds as received by the Agent, or if
requested by such Company, by wire transfer in accordance with written
instructions provided to the Agent by the Company of such funds as
received by the Agent, less customary fees for such wire transfer.
(d) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than five (5) different
Interest Periods in effect.
2.04 Conversion and Continuation Elections. (a) Any Company may,
upon irrevocable written notice to the Agent in accordance with Section
2.04(b):
(i) elect to convert, as of any Business Day, any Base Rate
Loans (or any part thereof in an amount not less than $5,000,000,
or that is in an integral multiple of $1,000,000 in excess
thereof) into Offshore Rate Loans;
(ii) elect to convert, as of the last day of the applicable
Interest Period, any Offshore Rate Loans expiring on such day (or
any part thereof in an amount not less than $1,000,000, or that is
in an integral multiple of $1,000,000 in excess thereof) into Base
Rate Loans; or
(iii) elect to continue, as of the last day of the applicable
Interest Period, any Offshore Rate Loans having Interest Periods
expiring on such day (or any part thereof in an amount not less
than $5,000,000, or that is in an integral multiple of $1,000,000
in excess thereof);
provided, that if at any time the aggregate amount of Offshore Rate
Loans in respect of any Borrowing is reduced, by payment, prepayment,
or conversion of part thereof to be less than $5,000,000, such Offshore
Rate Loans shall automatically convert into Base Rate Loans, and on and
after such date the right of any Company to continue such Loans as, and
convert such Loans into, Offshore Rate Loans shall terminate.
(b) The Company shall deliver a Notice of Conversion/Continuation
to be received by the Agent not later than 9:00 a.m. (San Francisco
time) at least (i) three Business Days in advance of the
Conversion/Continuation Date, if the Loans are to be converted into or
continued as Offshore Rate Loans; and (ii) one Business Day in advance
of the Conversion/ Continuation Date, if the Loans are to be converted
into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
continued;
(C) the Type of Loans resulting from the proposed conversion
or continuation; and
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Companies have failed to select timely a new
Interest Period to be applicable to such Offshore Rate Loans, as the
case may be, or if any Default or Event of Default then exists, the
Company shall be deemed to have elected to convert such Offshore Rate
Loans into Base Rate Loans effective as of the expiration date of such
Interest Period, and all conditions to such conversion shall be deemed
to have been satisfied.
(d) The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided
by any Company, the Agent will promptly notify each Bank of the details
of any automatic conversion. All conversions and continuations shall be
made ratably according to the respective outstanding principal amounts
of the Loans with respect to which the notice was given held by each
Bank.
(e) Unless the Majority Banks otherwise consent, during the
existence of a Default or Event of Default, no Company may elect to
have a Loan converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of
Loans, unless the Agent shall otherwise consent, there may not be more
than five (5) different Interest Periods in effect.
2.05 Voluntary Termination or Reduction of Commitments. Any
Company may, upon five Business Days' prior notice to the Agent,
terminate the Commitments, or permanently reduce the Commitments by an
aggregate minimum amount of $5,000,000 or any multiple of $1,000,000 in
excess thereof; unless, after giving effect thereto and to any
prepayments of Loans made on the effective date thereof, the
then-outstanding principal amount of the Loans would exceed the amount
of the combined Commitments then in effect. Once reduced in accordance
with this Section 2.05, the Commitments may not be increased. Any
reduction of the Commitments shall be applied to each Bank according to
its Pro Rata Share. All accrued commitment fees to the effective date
of any reduction or termination of Commitments, shall be paid on the
effective date of such reduction or termination.
2.06 Optional Prepayments. Subject to Section 4.04, any Company
may, at any time or from time to time, upon irrevocable notice received
by the Agent, in the case of Offshore Rate Loans, not less than three
Business Days prior to the requested prepayment date, and, in the case
of Base Rate Loans, not less than one Business Day prior to the
requested prepayment date, ratably prepay Loans in whole or in part, in
minimum amounts of $5,000,000 or any multiple of $1,000,000 in excess
thereof. Such notice of prepayment shall specify the date and amount of
such prepayment and the Type(s) of Loans to be prepaid. The Agent will
promptly notify each Bank of its receipt of any such notice, and of
such Bank's Pro Rata Share of such prepayment. If such notice is given
by any Company, such Company shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to each such date on
the amount prepaid and any amounts required pursuant to Section 3.04.
2.07 Cash Collateralization; Mandatory Prepayments of Loans. If on
any date the Effective Amount of L/C Obligations exceeds the L/C
Commitment, the Companies shall Cash Collateralize on such date the
outstanding Letters of Credit in an amount equal to the excess of the
maximum amount then available to be drawn under the Letters of Credit
over the L/C Commitment. Subject to Section 4.04, if on any date after
giving effect to any Cash Collateralization made on such date pursuant
to the preceding sentence, the Effective Amount of all Loans and L/C
Obligations together exceeds the combined Commitments, the Company
shall immediately, and without notice or demand, prepay the outstanding
principal amount of the Loans and L/C Advances by an amount equal to
the applicable excess.
2.08 Repayment. The Companies shall repay to the Banks on the
Revolving Termination Date the aggregate principal amount of all Loans
outstanding on such date.
2.09 Interest. (a) Each Loan shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date
at a rate per annum equal to the Offshore Rate or the Base Rate, as the
case may be (and subject to a Company's right to convert to other Types
of Loans under Section 2.04), plus the Applicable Margin.
(b) Interest on each Loan shall be paid in arrears on each
Interest Payment Date. Interest shall also be paid on the date of any
prepayment of Loans under Section 2.06 or 2.07 for the portion of the
Loans so prepaid and upon payment (including prepayment) in full
thereof and, during the existence of any Event of Default, interest
shall be paid on demand of the Agent at the request or with the consent
of the Majority Banks.
(c) Notwithstanding subsection (a) of this Section, during the
existence of any Event of Default under Section 9.01(a), or 9.01(e),
9.01(k), 9.01(m), or under 9.01(c) as a consequence of the failure of
the any of the Companies to observe or perform or cause to be observed
or performed any term, covenant or agreement contained in Section 7.11
or Article VIII, or after acceleration, the Company shall pay interest
(after as well as before any entry of judgment thereon to the extent
permitted by law) on the principal amount of all outstanding
Obligations, at a rate per annum which is determined by adding two and
one-half percent (2.50%) per annum to the Applicable Margin then in
effect for such Loans and, in the case of Obligations not subject to an
Applicable Margin, at a rate per annum equal to the Base Rate plus two
and one- half percent (2.50%); provided, however, that, on and after
the expiration of any Interest Period applicable to any Offshore Rate
Loan outstanding on the date of occurrence of such Event of Default or
acceleration, the principal amount of such Loan shall, during the
continuation of such Event of Default or after acceleration, bear
interest at a rate per annum equal to the Base Rate plus two and
one-half percent (2.50%). All such interest shall be payable upon
demand.
(d) Anything herein to the contrary notwithstanding, the
obligations of any Company to any Bank hereunder shall be subject to
the limitation that payments of interest shall not be required for any
period for which interest is computed hereunder, to the extent (but
only to the extent) that contracting for or receiving such payment by
such Bank would be contrary to the provisions of any law applicable to
such Bank limiting the highest rate of interest that may be lawfully
contracted for, charged or received by such Bank, and in such event the
Companies shall pay such Bank interest at the highest rate permitted by
applicable law.
2.10 Fees. (a) Agency Fees. The Companies shall pay an agency fee
to the Agent for the Agent's own account, as required by the letter
agreement between the Companies and the Agent dated as of October 31,
1996 (the "Fee Letter").
(b) Commitment Fees. The Companies shall pay to the Agent for the
account of each Bank a commitment fee on the average daily unused
portion of such Bank's Commitment, computed on a quarterly basis in
arrears on the last Business Day of each calendar quarter based upon
the daily utilization for that quarter as calculated by the Agent,
equal to such unused portion as so calculated multiplied by the
Applicable Commitment Fee Percentage for such period. Such commitment
fee shall accrue from the Closing Date to the Revolving Termination
Date and shall be due and payable quarterly in arrears on the last
Business Day of each quarter commencing on October 31, 1996 through the
Revolving Termination Date, with the final payment to be made on the
Revolving Termination Date; provided that, in connection with any
reduction or termination of Commitments under Section 2.05, the accrued
commitment fee calculated for the period ending on such date shall also
be paid on the date of such reduction or termination, with the
following quarterly payment being calculated on the basis of the period
from such reduction or termination date to such quarterly payment date.
The commitment fees provided in this Section shall accrue at all times
after the Closing Date, including at any time during which one or more
conditions in Article V are not met.
2.11 Computation of Fees and Interest. (a) All computations of
interest for Base Rate Loans when the Base Rate is determined by BofA's
"reference rate" shall be made on the basis of a year of 365 or 366
days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a
360-day year and actual days elapsed (which results in more interest
being paid than if computed on the basis of a 365-day year). Interest
and fees shall accrue during each period during which interest or such
fees are computed from the first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Companies and the Banks in the absence of
manifest error.
2.12 Payments by the Companies. (a) All payments to be made by the
Companies shall be made without set-off, recoupment or counterclaim.
Except as otherwise expressly provided herein, all payments by the
Companies shall be made to the Agent for the account of the Banks at
the Agent's Payment Office, and shall be made in dollars and in
immediately available funds, no later than 11:00 a.m. (San Francisco
time) on the date specified herein. The Agent will promptly distribute
to each Bank its Pro Rata Share (or other applicable share as expressly
provided herein) of such payment in like funds as received. Any payment
received by the Agent later than 11:00 a.m. (San Francisco time) shall
be deemed to have been received on the following Business Day and any
applicable interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other
than a Business Day, such payment shall be made on the following
Business Day, and such extension of time shall in such case be included
in the computation of interest or fees, as the case may be.
(c) Unless the Agent receives notice from a Company prior to the
date on which any payment is due to the Banks that the Companies will
not make such payment in full as and when required, the Agent may
assume that the Companies have made such payment in full to the Agent
on such date in immediately available funds and the Agent may (but
shall not be so required), in reliance upon such assumption, distribute
to each Bank on such due date an amount equal to the amount then due
such Bank. If and to the extent the Companies have not made such
payment in full to the Agent, each Bank shall repay to the Agent on
demand such amount distributed to such Bank, together with interest
thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Bank until the date repaid.
2.13 Payments by the Banks to the Agent. (a) Unless the Agent
receives notice from a Bank on or prior to the Closing Date or, with
respect to any Borrowing after the Closing Date, at least one Business
Day prior to the date of such Borrowing, that such Bank will not make
available as and when required hereunder to the Agent for the account
of the Company the amount of that Bank's Pro Rata Share of the
Borrowing, the Agent may assume that each Bank has made such amount
available to the Agent in immediately available funds on the Borrowing
Date and the Agent may (but shall not be so required), in reliance upon
such assumption, make available to the Company on such date a
corresponding amount. If and to the extent any Bank shall not have made
its full amount available to the Agent in immediately available funds
and the Agent in such circumstances has made available to the Company
such amount, that Bank shall on the Business Day following such
Borrowing Date make such amount available to the Agent, together with
interest at the Federal Funds Rate for each day during such period. A
notice of the Agent submitted to any Bank with respect to amounts owing
under this subsection (a) shall be conclusive, absent manifest error.
If such amount is so made available, such payment to the Agent shall
constitute such Bank's Loan on the date of Borrowing for all purposes
of this Agreement. If such amount is not made available to the Agent on
the Business Day following the Borrowing Date, the Agent will notify
the Company of such failure to fund and, upon demand by the Agent, the
Companies shall pay such amount to the Agent for the Agent's account,
together with interest thereon for each day elapsed since the date of
such Borrowing, at a rate per annum equal to the interest rate
applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a
Loan on such Borrowing Date, but no Bank shall be responsible for the
failure of any other Bank to make the Loan to be made by such other
Bank on any Borrowing Date.
2.14 Sharing of Payments, etc. If, other than as expressly
provided elsewhere herein, any Bank shall obtain on account of the
Loans or L/C Advances made by it any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or
otherwise) in excess of its Pro Rata Share (or other share contemplated
hereunder), such Bank shall immediately (a) notify the Agent of such
fact, and (b) purchase from the other Banks such participations in the
Loans or L/C Advances made by them as shall be necessary to cause such
purchasing Bank to share the excess payment pro rata with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to
that extent be rescinded and each other Bank shall repay to the
purchasing Bank the purchase price paid therefor, together with an
amount equal to such paying Bank's ratable share (according to the
proportion of (i) the amount of such paying Bank's required repayment
to (ii) the total amount so recovered from the purchasing Bank) of any
interest or other amount paid or payable by the purchasing Bank in
respect of the total amount so recovered. Each Company agrees that any
Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to Section 11.10) with
respect to such participation as fully as if such Bank were the direct
creditor of each Company in the amount of such participation. The Agent
will keep records (which shall be conclusive and binding in the absence
of manifest error) of participations purchased under this Section and
will in each case notify the Banks following any such purchases or
repayments.
ARTICLE III
THE LETTERS OF CREDIT
---------------------
3.01 The Letter of Credit Subfacility. (a) On the terms and
conditions set forth herein (i) the Issuing Bank agrees, (A) from time
to time on any Business Day during the period from the Closing Date to
the Revolving Termination Date to issue Letters of Credit for the
account of an L/C Borrower, and to amend or renew Letters of Credit
previously issued by it, in accordance with Sections 3.02(c) and
3.02(d), and (B) to honor drafts under the Letters of Credit; and (ii)
the Banks severally agree to participate in Letters of Credit Issued
for the account of each L/C Borrower; provided, that the Issuing Bank
shall not be obligated to Issue, and no Bank shall be obligated to
participate in, any Letter of Credit if as of the date of and after
giving effect to the Issuance of such Letter of Credit (the "Issuance
Date") (1) the Effective Amount of all L/C Obligations and Loans
together exceeds (or would exceed) the combined Commitments, or (2) the
participation of any Bank in the Effective Amount of all L/C
Obligations plus the Effective Amount of the Loans of such Bank exceeds
(or would exceed) such Bank's Commitment. Within the foregoing limits,
and subject to the other terms and conditions hereof, the L/C
Borrowers' ability to obtain Letters of Credit shall be fully
revolving, and, accordingly, each L/C Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit
which have expired or which have been drawn upon and reimbursed.
(b) The Issuing Bank is under no obligation to Issue any Letter of
Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain the Issuing Bank from Issuing such Letter of Credit, or
any Requirement of Law applicable to the Issuing Bank or any
request or directive (whether or not having the force of law) from
any Governmental Authority with jurisdiction over the Issuing Bank
shall prohibit, or request that the Issuing Bank refrain from, the
Issuance of letters of credit generally or such Letter of Credit
in particular or shall impose upon the Issuing Bank with respect
to such Letter of Credit any restriction, reserve or capital
requirement (for which the Issuing Bank is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall
impose upon the Issuing Bank any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which the
Issuing Bank in good xxxxx xxxxx material to it;
(ii) the Issuing Bank has received written notice from any
Bank, the Agent or any Company, on or prior to the Business Day
prior to the requested date of Issuance of such Letter of Credit,
that one or more of the applicable conditions contained in Article
V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (A)
more than 360 days after the date of Issuance, or (B) after the
Revolving Termination Date, unless all of the Banks have approved
such expiry date in writing;
(iv) the expiry date of any requested Letter of Credit is
prior to the maturity date of any financial obligation to be
supported by the requested Letter of Credit;
(v) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance acceptable to
the Issuing Bank, or the Issuance of a Letter of Credit shall
violate any applicable policies of the Issuing Bank;
(vi) any standby Letter of Credit is for the purpose of
supporting the issuance of any letter of credit by any other
Person;
(vii) such Letter of Credit is in a face amount less than
$50,000 (other than the Existing Letters of Credit that are in a
face amount less than $50,000 and any renewals thereof) or to be
denominated in a currency other than Dollars; or
(viii) the Issuing Bank is also the Agent and the Agent shall
have for any reason ceased to be the Agent pursuant to Section
11.09, in which case any other Bank may, upon the request or with
the consent of Xxxxxxxxx, act as Issuing Bank.
3.02 Issuance, Amendment and Renewal of Letters of Credit. (a)
Each Letter of Credit shall be issued upon the irrevocable written
request of the L/C Borrower received by the Issuing Bank (with a copy
sent by the L/C Borrower to the Agent) at least four days (or such
shorter time as the Issuing Bank may agree in a particular instance in
its sole discretion) prior to the proposed date of issuance. Each such
request for issuance of a Letter of Credit shall be by facsimile,
confirmed immediately in an original writing, in the form of an L/C
Application, and shall specify in form and detail satisfactory to the
Issuing Bank: (i) the proposed date of issuance of the Letter of Credit
(which shall be a Business Day); (ii) the face amount of the Letter of
Credit; (iii) the expiry date of the Letter of Credit; (iv) the name
and address of the beneficiary thereof; (v) the documents to be
presented by the beneficiary of the Letter of Credit in case of any
drawing thereunder; (vi) the full text of any certificate to be
presented by the beneficiary in case of any drawing thereunder; and
(vii) such other matters as the Issuing Bank may require.
(b) At least two Business Days prior to the Issuance of any Letter
of Credit, the Issuing Bank will confirm with the Agent (by telephone
or in writing) that the Agent has received a copy of the L/C
Application or L/C Amendment Application from an L/C Borrower and, if
not, the Issuing Bank will provide the Agent with a copy thereof.
Unless the Issuing Bank has received notice on or before the Business
Day immediately preceding the date the Issuing Bank is to issue a
requested Letter of Credit from the Agent (A) directing the Issuing
Bank not to issue such Letter of Credit because such issuance is not
then permitted under Section 3.01(a) as a result of the limitations set
forth in clauses (1) through (3) thereof or Section 3.01(b)(ii); or (B)
that one or more conditions specified in Article V are not then
satisfied; then, subject to the terms and conditions hereof, the
Issuing Bank shall, on the requested date, issue a Letter of Credit for
the account of such L/C Borrower in accordance with the Issuing Bank's
usual and customary business practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Bank will, upon
the written request of an L/C Borrower received by the Issuing Bank
(with a copy sent by an L/C Borrower to the Agent) at least four (4)
days (or such shorter time as the Issuing Bank may agree in a
particular instance in its sole discretion) prior to the proposed date
of amendment, amend any Letter of Credit issued by it. Each such
request for amendment of a Letter of Credit shall be made by facsimile,
confirmed immediately in an original writing, made in the form of an
L/C Amendment Application and shall specify in form and detail
satisfactory to the Issuing Bank: (i) the Letter of Credit to be
amended; (ii) the proposed date of amendment of the Letter of Credit
(which shall be a Business Day); (iii) the nature of the proposed
amendment; and (iv) such other matters as the Issuing Bank may require.
The Issuing Bank shall be under no obligation to amend any Letter of
Credit if: (A) the Issuing Bank would have no obligation at such time
to issue such Letter of Credit in its amended form under the terms of
this Agreement; or (B) the beneficiary of any such Letter of Credit
does not accept the proposed amendment to the Letter of Credit. The
Agent will promptly notify the Banks of the receipt by it of any L/C
Application or L/C Amendment Application.
(d) The Issuing Bank and the Banks agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, at
the option of an L/C Borrower and upon the written request of an L/C
Borrower received by the Issuing Bank (with a copy sent by an L/C
Borrower to the Agent) at least five days (or such shorter time as the
Issuing Bank may agree in a particular instance in its sole discretion)
prior to the proposed date of notification of renewal, the Issuing Bank
shall be entitled to authorize the automatic renewal of any Letter of
Credit issued by it. Each such request for renewal of a Letter of
Credit shall be made by facsimile, confirmed immediately in an original
writing, in the form of an L/C Amendment Application, and shall specify
in form and detail satisfactory to the Issuing Bank: (i) the Letter of
Credit to be renewed; (ii) the proposed date of notification of renewal
of the Letter of Credit (which shall be a Business Day); (iii) the
revised expiry date of the Letter of Credit; and (iv) such other
matters as the Issuing Bank may require. The Issuing Bank shall be
under no obligation to renew any Letter of Credit if: (A) the Issuing
Bank would have no obligation at such time to issue or amend such
Letter of Credit in its renewed form under the terms of this Agreement;
or (B) the beneficiary of any such Letter of Credit does not accept the
proposed renewal of the Letter of Credit. If any outstanding Letter of
Credit shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the Issuing Bank that such
Letter of Credit shall not be renewed, and if at the time of renewal
the Issuing Bank would be entitled to authorize the automatic renewal
of such Letter of Credit in accordance with this Section 3.02(d) upon
the request of an L/C Borrower but the Issuing Bank shall not have
received any L/C Amendment Application from such L/C Borrower with
respect to such renewal or other written direction by such L/C Borrower
with respect thereto, the Issuing Bank shall nonetheless be permitted
to allow such Letter of Credit to renew, and the Companies and the
Banks hereby authorize such renewal, and, accordingly, the Issuing Bank
shall be deemed to have received an L/C Amendment Application from such
L/C Borrower requesting such renewal.
(e) The Issuing Bank may, at its election (or as required by the
Agent at the direction of the Majority Banks), deliver any notices of
termination or other communications to any Letter of Credit beneficiary
or transferee, and take any other action as necessary or appropriate,
at any time and from time to time, in order to cause the expiry date of
such Letter of Credit to be a date not later than the Revolving
Termination Date.
(f) This Agreement shall control in the event of any conflict with
any L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Bank will also deliver to the Agent, concurrently
or promptly following its delivery of a Letter of Credit, or amendment
to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or
amendment to or renewal of a Letter of Credit.
3.03 Existing Letters of Credit; Risk Participations, Drawings and
Reimbursements.
(a) On and after the Closing Date, the Existing Letters of Credit
shall be deemed for all purposes, including for purposes of the fees to
be collected pursuant to Sections 3.08(a) and 3.08(c), and
reimbursement of costs and expenses to the extent provided herein,
Letters of Credit outstanding under this Agreement and entitled to the
benefits of this Agreement and the other Loan Documents, and shall be
governed by the applications and agreements pertaining thereto and by
this Agreement. Each Bank acknowledges and agrees that the Existing
Letters of Credit constitute Letters of Credit outstanding under this
Agreement on and as of the Closing Date. Each Bank shall be deemed to,
and hereby irrevocably and unconditionally agrees to, purchase from the
Issuing Bank on the Closing Date a participation in each such Letter of
Credit and each drawing thereunder in an amount equal to the product of
(i) such Bank's Pro Rata Share times (ii) the maximum amount available
to be drawn under such Letter of Credit and the amount of such drawing,
respectively. For purposes of Section 2.01 and Section 2.10(b), the
Existing Letters of Credit shall be deemed to utilize pro rata the
Commitment of each Bank.
(b) Immediately upon the Issuance of each Letter of Credit in
addition to those described in Section 3.03(a), each Bank shall be
deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Issuing Bank a participation in such Letter of Credit
and each drawing thereunder in an amount equal to the product of (i)
the Pro Rata Share of such Bank, times (ii) the maximum amount
available to be drawn under such Letter of Credit and the amount of
such drawing, respectively. For purposes of Section 2.01, each Issuance
of a Letter of Credit shall be deemed to utilize the Commitment of each
Bank by an amount equal to the amount of such participation.
(c) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the Issuing Bank will
promptly notify the Company. The Company shall reimburse the Issuing
Bank prior to 10:00 a.m. (San Francisco time), on each date that any
amount is paid by the Issuing Bank under any Letter of Credit (each
such date, an "Honor Date"), in an amount equal to the amount so paid
by the Issuing Bank. In the event any Company fails to reimburse the
Issuing Bank for the full amount of any drawing under any Letter of
Credit by 10:00 a.m. (San Francisco time) on the Honor Date, the
Issuing Bank will promptly notify the Agent and the Agent will promptly
notify each Bank thereof, and the Companies shall be deemed to have
requested that Base Rate Loans be made by each of the Banks to be
disbursed on the Honor Date under such Letter of Credit, subject to the
amount of the unutilized portion of the aggregate Commitments and
subject to the conditions set forth in Section 5.02. Any notice given
by the Issuing Bank or the Agent pursuant to this subsection 3.03(c)
may be oral if immediately confirmed in writing (including by
facsimile); provided that the lack of such an immediate confirmation
shall not affect the conclusiveness or binding effect of such notice.
(d) Each Bank shall upon any notice pursuant to Section 3.03(c)
make available to the Agent for the account of the Issuing Bank an
amount in Dollars and in immediately available funds equal to its Pro
Rata Share of the amount of the drawing, whereupon the participating
Banks shall (subject to Section 3.03(e)) each be deemed to have made a
Loan consisting of a Base Rate Loan to the Companies in that amount. If
any Bank so notified fails to make available to the Agent for the
account of the Issuing Bank the amount of such Bank's Pro Rata Share of
the amount of the drawing by no later than 2:00 p.m. (San Francisco
time) on the Honor Date, then interest shall accrue on such Bank's
obligation to make such payment, from the Honor Date to the date such
Bank makes such payment, at a rate per annum equal to the Federal Funds
Rate in effect from time to time during such period. The Agent will
promptly give notice of the occurrence of the Honor Date, but failure
of the Agent to give any such notice on the Honor Date or in sufficient
time to enable any Bank to effect such payment on such date shall not
relieve such Bank from its obligations under this Section 3.03.
(e) With respect to any unreimbursed drawing that is not converted
into Loans consisting of Base Rate Loans to the Companies in whole or
in part, because of the Company's failure to satisfy the conditions set
forth in Section 5.02 or for any other reason, the Companies shall be
deemed to have incurred from the Issuing Bank an L/C Borrowing in the
amount of such drawing, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at a rate per
annum equal to the Base Rate plus two and one-half percent (2.50%), and
each Bank's payment to the Issuing Bank pursuant to Section 3.03(d)
shall be deemed payment in respect of its participation in such L/C
Borrowing and shall constitute an L/C Advance from such Bank in
satisfaction of its participation obligation under this Section 3.03.
(f) Each Bank's obligation in accordance with this Agreement to
make the Loans or L/C Advances, as contemplated by this Section 3.03,
as a result of a drawing under a Letter of Credit, shall be absolute
and unconditional and without recourse to the Issuing Bank and shall
not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Bank may
have against the Issuing Bank, any Company, any guarantor or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of
a Default, an Event of Default or a Material Adverse Effect; or (iii)
any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing; provided, however, that without
limiting any Bank's obligation to make L/C Advances hereunder, each
Bank's obligation to make Loans under this Section 3.03 is subject to
the conditions set forth in Section 5.02.
3.04 Repayment of Participations. (a) Upon (and only upon) receipt
by the Agent for the account of the Issuing Bank of immediately
available funds from any Company (i) in reimbursement of any payment
made by the Issuing Bank under the Letter of Credit with respect to
which any Bank has paid the Agent for the account of the Issuing Bank
for such Bank's participation in the Letter of Credit pursuant to
Section 3.03 or (ii) in payment of interest thereon, the Agent will pay
to each Bank, in like funds as those received by the Agent for the
account of the Issuing Bank, the amount of such Bank's Pro Rata Share
of such funds, and the Issuing Bank shall receive and retain the amount
of the Pro Rata Share of such funds of any Bank that did not so pay the
Agent for the account of the Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any time to
return to any Company, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of
the payments made by any Company (or any other Person) to the Agent for
the account of the Issuing Bank pursuant to Section 3.04(a) in
reimbursement of a payment made under the Letter of Credit or interest
or fee thereon, each Bank shall, on demand of the Agent, forthwith
return to the Agent or the Issuing Bank the amount of its Pro Rata
Share of any amounts so returned by the Agent or the Issuing Bank plus
interest thereon from the date such demand is made to the date such
amounts are returned by such Bank to the Agent or the Issuing Bank, at
a rate per annum equal to the Federal Funds Rate in effect from time to
time.
3.05 Role of the Issuing Bank. (a) Each Bank and each L/C Borrower
agree that, in paying any drawing under a Letter of Credit, the Issuing
Bank shall not have any responsibility to obtain any document (other
than any sight draft and certificates expressly required by the Letter
of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or
delivering any such document.
(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be
liable to any Bank for: (i) any action taken or omitted in connection
herewith at the request or with the approval of the Banks (including
the Majority Banks, as applicable); (ii) any action taken or omitted in
the absence of gross negligence or willful misconduct; or (iii) the due
execution, effectiveness, validity or enforceability of any L/C-Related
Document.
(c) Each L/C Borrower jointly and severally hereby assumes all
risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided, however, that
this assumption is not intended to, and shall not, preclude any L/C
Borrower's pursuit of such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent- Related Person, nor any of the respective correspondents,
participants or assignees of the Issuing Bank, shall be liable or
responsible for any of the matters described in clauses (i) through
(vii) of Section 3.06; provided, however, anything in such clauses to
the contrary notwithstanding, that an L/C Borrower may have a claim
against the Issuing Bank, and the Issuing Bank may be liable to an L/C
Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by such L/C
Borrower which such L/C Borrower proves were caused by the Issuing
Bank's willful misconduct or gross negligence or the Issuing Bank's
willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a
Letter of Credit. In furtherance and not in limitation of the
foregoing: (i) the Issuing Bank may accept documents that appear on
their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary;
and (ii) the Issuing Bank shall not be responsible for the validity or
sufficiency of any instrument transferring or assigning or purporting
to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason.
3.06 Obligations Absolute. The obligations of each L/C Borrower
under this Agreement and any L/C-Related Document to reimburse the
Issuing Bank for a drawing under a Letter of Credit, and to repay any
L/C Borrowing and any drawing under a Letter of Credit converted into
Loans, shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement and each such
other L/C-Related Document under all circumstances, including the
following:
(i) any lack of validity or enforceability of this Agreement,
any L/C-Related Document or other Loan Document;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of an L/C
Borrower in respect of any Letter of Credit or any other amendment
or waiver of or any consent to departure from all or any of the
L/C-Related Documents;
(iii) the existence of any claim, set-off, defense or other
right that an L/C Borrower may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any
Person for whom any such beneficiary or any such transferee may be
acting), the Issuing Bank or any other Person, whether in
connection with this Agreement, the transactions contemplated
hereby or by the L/C-Related Documents or any unrelated
transaction;
(iv) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or
any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under any Letter of Credit;
(v) any payment by the Issuing Bank under any Letter of Credit
against presentation of a draft or certificate that does not
strictly comply with the terms of any Letter of Credit; or any
payment made by the Issuing Bank under any Letter of Credit to any
Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to
any beneficiary or any transferee of any Letter of Credit,
including any arising in connection with any Insolvency
Proceeding;
(vi) any exchange, release or non perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any other guarantee, for all or any of the
obligations of any L/C Borrower in respect of any Letter of
Credit;
(vii) any misapplication by the beneficiary of any Letter of
Credit of the proceeds of any drawing under such Letter of Credit;
or
(viii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available
to, or a discharge of, any L/C Borrower.
3.07 Cash Collateral Pledge. Upon (a) the request of the Agent,
(i) if the Issuing Bank has honored any full or partial drawing request
on any Letter of Credit and such drawing has resulted in an L/C
Borrowing hereunder, or (ii) if, as of the Revolving Termination Date,
any Letters of Credit may for any reason remain outstanding and
partially or wholly undrawn, or (b) the occurrence of the circumstances
described in Section 2.07 requiring any L/C Borrower to Cash
Collateralize Letters of Credit, then, such L/C Borrower shall
immediately Cash Collateralize or cause to be Cash Collateralized the
L/C Obligations in an amount equal to such L/C Obligations. Such
amount, when received by the Agent, shall be held by the Agent and
maintained in blocked deposit accounts at BofA as Cash Collateral for
reimbursement obligations of any and all of the L/C Borrowers in
respect of the L/C Obligations and for the other Obligations. Each of
the Companies and each of the L/C Borrowers hereby grant to the Agent,
for the benefit of the Agent, the Issuing Bank and the Banks, a
security interest in all such cash, deposit accounts and deposit
account balances. After payment in full of all L/C Obligations and the
expiry of all Letters of Credit, the proceeds of any Cash Collateral
shall be used to satisfy any other Obligations then outstanding. Each
of the L/C Borrowers shall executed and cause to be executed such
further agreements, documents and instruments and shall take and cause
to be taken such further actions in connection with such Cash
Collateralization as the Agent may reasonably request.
3.08 Letter of Credit Fees. (a) The Companies shall pay to the
Agent for the account of each of the Banks a letter of credit fee based
on the average daily maximum amount available to be drawn on
outstanding Letters of Credit at a rate equal to the Applicable Margin
for Offshore Rate Loans, adjusted as provided in the definition of
"Applicable Margin," which fee shall be computed on a quarterly basis
in arrears on the last Business Day of each calendar quarter based upon
Letters of Credit outstanding for that quarter as calculated by the
Agent. Such letter of credit fees shall be due and payable quarterly in
arrears on the last Business Day of each calendar quarter during which
Letters of Credit are outstanding, commencing on the first such
quarterly date to occur after the Closing Date, through the Revolving
Termination Date (or such later date upon which the outstanding Letters
of Credit shall expire), with the final payment to be made on the
Revolving Termination Date (or such later expiration date, if any).
(b) The Companies shall pay to the Issuing Bank a letter of credit
fronting fee for each Letter of Credit Issued by the Issuing Bank equal
to 0.125% per annum of the face amount (or increased face amount, as
the case may be) of such Letter of Credit. Such Letter of Credit
fronting fee shall be due and payable on each date of Issuance of a
Letter of Credit.
(c) Each L/C Borrower shall pay to the Issuing Bank from time to
time on demand the normal issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the Issuing
Bank relating to letters of credit as from time to time in effect.
3.09 Uniform Customs and Practice. The Uniform Customs and
Practice for Documentary Credits as published by the International
Chamber of Commerce most recently at the time of issuance of any Letter
of Credit shall (unless otherwise expressly provided in the Letters of
Credit) apply to the Letters of Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
--------------------------------------
4.01 Taxes. (a) Any and all payments by any Company to each Bank
or the Agent under this Agreement and any other Loan Document shall be
made free and clear of, and without deduction or withholding for, any
Taxes. In addition, the Companies shall pay all Other Taxes.
(b) If any Company shall be required by law to deduct or withhold
any Taxes, Other Taxes or Further Taxes from or in respect of any sum
payable hereunder to any Bank or the Agent, then:
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section), such Bank or the Agent, as the case may be,
receives and retains an amount equal to the sum it would have
received and retained had no such deductions or withholdings been
made;
(ii) the Companies shall make such deductions and
withholdings;
(iii) the Companies shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Companies shall also pay to each Bank or the Agent
for the account of such Bank, at the time interest is paid,
Further Taxes in the amount that the respective Bank specifies as
necessary to preserve the after-tax yield the Bank would have
received if such Taxes, Other Taxes or Further Taxes had not been
imposed.
(c) The Companies agree to indemnify and hold harmless each Bank
and the Agent for the full amount of i) Taxes, ii) Other Taxes, and
iii) Further Taxes in the amount that the respective Bank specifies as
necessary to preserve the after-tax yield the Bank would have received
if such Taxes, Other Taxes or Further Taxes had not been imposed, and
any liability (including penalties, interest, additions to tax and
expenses) arising therefrom or with respect thereto, whether or not
such Taxes, Other Taxes or Further Taxes were correctly or legally
asserted. Payment under this indemnification shall be made within 30
days after the date the Bank or the Agent makes written demand
therefor.
(d) Within 30 days after the date of any payment by any Company of
Taxes, Other Taxes or Further Taxes, the Companies shall furnish to
each Bank or the Agent the original or a certified copy of a receipt
evidencing payment thereof, or other evidence of payment satisfactory
to such Bank or the Agent.
(e) If any Company is required to pay any amount to any Bank or
the Agent pursuant to subsection (b) or (c) of this Section, then such
Bank shall use reasonable efforts (consistent with legal and regulatory
restrictions) to change the jurisdiction of its Lending Office so as to
eliminate any such additional payment by the Companies which may
thereafter accrue, if such change in the sole and absolute judgment of
such Bank is not otherwise disadvantageous to such Bank.
4.02 Illegality. (a) If any Bank determines that the introduction
of any Requirement of Law, or any change in any Requirement of Law, or
in the interpretation or administration of any Requirement of Law, has
made it unlawful, or that any central bank or other Governmental
Authority has asserted that it is unlawful, for any Bank or its
applicable Lending Office to make Offshore Rate Loans, then, on notice
thereof by the Bank to the Companies through the Agent, any obligation
of that Bank to make Offshore Rate Loans shall be suspended until the
Bank notifies the Agent and the Companies that the circumstances giving
rise to such determination no longer exist.
(b) If a Bank determines that it is unlawful to maintain any
Offshore Rate Loan, the Companies shall, upon its receipt of notice of
such fact and demand from such Bank (with a copy to the Agent), prepay
in full such Offshore Rate Loans of that Bank then outstanding,
together with interest accrued thereon and amounts required under
Section 4.04, either on the last day of the Interest Period thereof, if
the Bank may lawfully continue to maintain such Offshore Rate Loans to
such day, or immediately, if the Bank may not lawfully continue to
maintain such Offshore Rate Loan. If any Company is required to so
prepay any Offshore Rate Loan, then concurrently with such prepayment,
the Companies shall borrow from the affected Bank, in the amount of
such repayment, a Base Rate Loan.
(c) If the obligation of any Bank to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Companies may
elect, by giving notice to the Bank through the Agent that all Loans
which would otherwise be made by the Bank as Offshore Rate Loans shall
be instead Base Rate Loans.
4.03 Increased Costs and Reduction of Return. (a) If any Bank
determines that, due to either (i) the introduction of or any change in
or in the interpretation of any law or regulation or (ii) the
compliance by that Bank with any guideline or request from any central
bank or other Governmental Authority (whether or not having the force
of law), there shall be any increase in the cost to such Bank of
agreeing to make or making, funding or maintaining any Loans or
participating in Letters of Credit, or, in the case of the Issuing
Bank, any increase in the cost to the Issuing Bank of agreeing to
Issue, Issuing or maintaining any Letter of Credit or of agreeing to
make or making, funding or maintaining any unpaid drawing under any
Letter of Credit, then the Companies shall be liable for, and shall
from time to time, upon demand (with a copy of such demand to be sent
to the Agent), pay to the Agent for the account of such Bank or the
Issuing Bank, additional amounts as are sufficient to compensate such
Bank or such Issuing Bank for such increased costs.
(b) If any Bank shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or
administration of any Capital Adequacy Regulation by any central bank
or other Governmental Authority charged with the interpretation or
administration thereof, or (iv) compliance by the Bank (or its Lending
Office) or any corporation controlling the Bank with any Capital
Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by the Bank or any corporation
controlling the Bank and (taking into consideration such Bank's or such
corporation's policies with respect to capital adequacy and such Bank's
desired return on capital) determines that the amount of such capital
is increased as a consequence of its Commitment, loans, credits or
obligations under this Agreement, then, upon demand of such Bank to the
Companies through the Agent, the Companies shall immediately pay to the
Bank, from time to time as specified by the Bank, additional amounts
sufficient to compensate the Bank for such increase.
4.04 Funding Losses. The Companies shall reimburse each Bank and
hold each Bank harmless from any loss or expense which the Bank may
sustain or incur as a consequence of:
(a) the failure of any Company to make on a timely basis any
payment of principal of any Offshore Rate Loan (including after any
acceleration thereof);
(b) the failure of any Company to borrow, continue or convert a
Loan after such Company has given (or is deemed to have given) a Notice
of Borrowing or a Notice of Conversion/Continuation;
(c) the failure of any Company to make any prepayment in
accordance with any notice delivered under Section 2.06;
(d) the prepayment (including pursuant to Section 2.07) or other
payment (including after acceleration thereof) of an Offshore Rate Loan
on a day that is not the last day of the relevant Interest Period; or
(e) the conversion of any Offshore Rate Loan to a Base Rate Loan
on a day that is not the last day of the relevant Interest Period;
including any such loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain its Offshore Rate
Loans hereunder or from fees payable to terminate the deposits from
which such funds were obtained. For purposes of calculating amounts
payable by the Companies to the Banks under this Section and under
Section 4.03(a), each Offshore Rate Loan made by a Bank (and each
related reserve, special deposit or similar requirement) shall be
conclusively deemed to have been funded at the IBOR used in determining
the Offshore Rate for such Offshore Rate Loan by a matching deposit or
other borrowing in the interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Offshore Rate
Loan is in fact so funded.
4.05 Inability to Determine Rates. If the Agent determines that
for any reason adequate and reasonable means do not exist for
determining the Offshore Rate for any requested Interest Period with
respect to a proposed Offshore Rate Loan, or that the Offshore Rate
applicable pursuant to Section 2.09(a) for any requested Interest
Period with respect to a proposed Offshore Rate Loan does not
adequately and fairly reflect the cost to the Banks of funding such
Loan, the Agent will promptly so notify the Companies and each Bank.
Thereafter, the obligation of the Banks to make or maintain Offshore
Rate Loans hereunder shall be suspended until the Agent upon the
instruction of the Majority Banks revokes such notice in writing. Upon
receipt of such notice, the Companies may revoke any Notice of
Borrowing or Notice of Conversion/ Continuation then submitted by it.
If the Companies do not revoke such Notice, the Banks shall make,
convert or continue the Loans, as proposed by the Companies, in the
amount specified in the applicable notice submitted by the Companies,
but such Loans shall be made, converted or continued as Base Rate Loans
instead of Offshore Rate Loans.
4.06 Reserves on Offshore Rate Loans. The Companies shall pay to
each Bank, as long as such Bank shall be required under regulations of
the FRB to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently
known as "Eurocurrency liabilities"), additional costs on the unpaid
principal amount of each Offshore Rate Loan equal to the actual costs
of such reserves allocated to such Loan by the Bank (as determined by
the Bank in good faith, which determination shall be conclusive),
payable on each date on which interest is payable on such Loan,
provided the Companies shall have received at least 15 days' prior
written notice (with a copy to the Agent) of such additional costs from
the Bank. If a Bank fails to give notice 15 days prior to the relevant
Interest Payment Date, such additional interest shall be payable 15
days from receipt of such notice.
4.07 Certificates of Banks. Any Bank claiming reimbursement or
compensation under this Article IV shall deliver to the Companies (with
a copy to the Agent) a certificate setting forth in reasonable detail
the amount payable to the Bank hereunder and such certificate shall be
conclusive and binding on the Companies in the absence of manifest
error.
4.08 Survival. The agreements and obligations of the Companies in
this Article IV shall survive the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
--------------------
5.01 Conditions of Initial Credit Extension. The obligation of
each Bank (including the Issuing Bank) to make its initial Credit
Extension hereunder is subject to the condition that the Agent shall
have received on or before the Closing Date all of the following, in
form and substance satisfactory to the Agent and each Bank, and in
sufficient copies for each Bank:
(a) Credit Agreement; Notes. This Agreement and, if requested by
any Bank, the Notes, each executed by each party thereto;
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the respective boards of
directors of the Companies authorizing the transactions
contemplated hereby, certified as of the Closing Date by the each
Company's Secretary or an Assistant Secretary, respectively; and
(ii) A certificate of the Secretary or Assistant Secretary of
each of the Companies, certifying the names and true signatures of
the officers of each such Company authorized to execute, deliver
and perform, as applicable, this Agreement, and all other Loan
Documents to be delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the
bylaws of each of the Companies or, if applicable, the partnership
agreement, each as in effect on the Closing Date, certified by the
Secretary or Assistant Secretary or general partner of each such
Company as of the Closing Date; and
(ii) a good standing certificate from the Secretary of State
(or similar, applicable Governmental Authority) as of a recent
date, and, if requested by the Agent or any Bank, a bring-down
certificate by facsimile dated on or about the Closing Date and
tax good standing certificate, (A) for Xxxxxxxxx, of its state of
incorporation and the State of Washington, and (B) for each
Company other than Xxxxxxxxx, of its state of incorporation;
(d) Legal Opinions. An opinion of Xxxxx & Gate LLC, counsel to the
Companies and the Guarantors and addressed to the Agent and the Banks,
substantially in the form of Exhibit D;
(e) Certificate. A certificate signed by a Responsible Officer of
each Company, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article VI
are true and correct on and as of such date, as though made on and
as of such date;
(ii) no Default or Event of Default exists or would result
from the initial Credit Extension; and
(iii) there has occurred since October 31, 1995, no event or
circumstance that has resulted or could reasonably be expected to
result in a Material Adverse Effect; and
(f) Termination of Existing Facility. Evidence satisfactory to the
Agent confirming that if any principal, interest, fees, costs or other
amounts are outstanding under the Existing Facility, all such amounts
have been paid in full by the Closing Date or that the Loans borrowed
by the Companies on the Closing Date will be used to repay such
outstanding amounts, and that the Existing Facility and the commitments
of the "Banks" thereunder shall thereby terminate on the Closing Date,
together with evidence satisfactory to BofA, as agent under the
Existing Facility, of satisfaction or waiver by such Banks of any prior
notice of such termination as required under the Existing Facility; and
(g) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may reasonably request.
5.02 Conditions to All Credit Extensions. The obligation of each
Bank to make any Loan to be made by it (including its initial Loan) or
to continue or convert any Loan under Section 2.04 (other than pursuant
to Section 2.04(c)) and the obligation of the Issuing Bank to Issue any
Letter of Credit (including the initial Letter of Credit) is subject to
the satisfaction of the following conditions precedent on the relevant
Borrowing Date, Conversion/Continuation Date or Issuance Date:
(a) Notice; Application. In the case of any Borrowing of
Continuation/ Conversion (other than pursuant to Section 2.04(b)), the
Agent shall have received (with, in the case of the initial Loan only,
a copy for each Bank) a Notice of Borrowing or a Notice of
Conversion/Continuation, as applicable, and in the case of any Issuance
of any Letter of Credit, the Issuing Bank and the Agent shall have
received an L/C Application or L/C Amendment Application, as required
under Section 3.02;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct
on and as of such Borrowing Date, Conversion/ Continuation Date or
Issuance Date with the same effect as if made on and as of such
Borrowing Date, Conversion/Continuation Date or Issuance Date (except
to the extent such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct as of such
earlier date); and
(c) No Existing Default. No Default or Event of Default shall
exist or shall result from such Credit Extension or continuation or
conversion.
Each Notice of Borrowing, Notice of Conversion/Continuation and L/C
Application or L/C Amendment Application submitted by any Company
hereunder shall constitute a representation and warranty by each of the
Companies hereunder, as of the date of each such notice and as of each
Borrowing Date, Conversion/Continuation Date or Issuance Date, as
applicable, that the conditions in this Section 4.02 are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
------------------------------
Each Company represents and warrants to the Agent and each Bank
that:
6.01 Corporate Existence and Power. Each Company and each of its
Subsidiaries:
(a) is a corporation or partnership duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or formation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and perform its obligations under the
Loan Documents;
(c) is duly qualified as a foreign corporation or partnership and
is licensed and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of
its business requires such qualification or license except to the
extent that the failure to do so could not reasonably be expected to
have a Material Adverse Effect; and
(d) is in compliance with all Requirements of Law except to the
extent to which the failure to comply would not reasonably be expected
to have a Material Adverse Effect.
6.02 Corporate Authorization; No Contravention. The execution,
delivery and performance by each Company of this Agreement and each
other Loan Document to which each Company is party, have been duly
authorized by all necessary corporate action, and do not and will not:
(a) contravene the terms of any of such Company's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which any Company is a party or any order, injunction,
writ or decree of any Governmental Authority to which any Company or
its property is subject; or
(c) violate any Requirement of Law.
6.03 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, any
Company or any of its Subsidiaries of the Agreement or any other Loan
Document.
6.04 Binding Effect. This Agreement and each other Loan Document
to which any of the Companies is a party constitute the legal, valid
and binding obligations of such Company, enforceable against such
Company in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally
or by equitable principles relating to enforceability.
6.05 Litigation. Except as specifically disclosed in Schedule
6.05, there are no actions, suits, proceedings, claims or disputes
pending, or to the best knowledge of the Companies, threatened or
contemplated, at law, in equity, in arbitration or before any
Governmental Authority, against the Companies, or its Subsidiaries or
any of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby or
thereby; or
(b) if determined adversely to any Company or its Subsidiaries,
would reasonably be expected to have a Material Adverse Effect. No
injunction, writ, temporary restraining order or any order of any
nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution, delivery or performance
of this Agreement or any other Loan Document, or directing that the
transactions provided for herein or therein not be consummated as
herein or therein provided.
6.06 No Default. No Default or Event of Default exists or would
result from the incurring of any Obligations by any Company. As of the
Closing Date, none of the Companies nor any Subsidiary is in default
under or with respect to any Contractual Obligation in any respect
which, individually or together with all such defaults, could
reasonably be expected to have a Material Adverse Effect, or that
would, if such default had occurred after the Closing Date, create an
Event of Default under Section 9.01(e).
6.07 ERISA Compliance.
(a) As of the Closing Date, each Plan is in compliance with the
applicable provisions of ERISA, the Code and other federal or state law
except to the extent to which the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. Each Plan
which is intended to qualify under subsection 401(a) of the Code has
received a favorable determination letter from the IRS and to the best
knowledge of each Company, nothing has occurred which would cause the
loss of such qualification. As of the Closing Date, each Company and
each ERISA Affiliate has made all required contributions to any Plan
subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section
412 of the Code has been made with respect to any Plan.
(b) As of the Closing Date, there are no pending or, to the best
knowledge of each Company, threatened claims, actions or lawsuits, or
action by any Governmental Authority, with respect to any Plan which
has resulted or could reasonably be expected to result in a Material
Adverse Effect. As of the Closing Date, there has been no prohibited
transaction or violation of the fiduciary responsibility rules with
respect to any Plan which has resulted or could reasonably be expected
to result in a Material Adverse Effect.
(c) As of the Closing Date, (i) no ERISA Event has occurred or is
reasonably expected to occur; and (ii) no event or circumstance has
occurred or exists that, if such event or circumstance had occurred or
arisen after the Closing Date, would create an Event of Default under
Section 9.01(h).
6.08 Use of Proceeds; Margin Regulations. The proceeds of the
Loans are to be used solely for the purposes set forth in and permitted
by Section 7.12 and Section 8.07. None of the Companies nor any
Subsidiary is generally engaged in the business of purchasing or
selling Margin Stock or extending credit for the purpose of purchasing
or carrying Margin Stock.
6.09 Title to Properties. Each Company and each Subsidiary have
good record and marketable title in fee simple to, or valid leasehold
interests in, all real property necessary or used in the ordinary
conduct of their respective businesses, except for such defects in
title as could not, individually or in the aggregate, have a Material
Adverse Effect. As of the Closing Date, the property of the Companies
and their respective Subsidiaries is subject to no Liens, other than
Permitted Liens.
6.10 Taxes. The Companies and their respective Subsidiaries have
filed all Federal and other material tax returns and reports required
to be filed, and have paid all Federal and other material taxes,
assessments, fees and other governmental charges levied or imposed upon
them or their properties, income or assets otherwise due and payable,
except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment against any
Company or any Subsidiary that would, if made, have a Material Adverse
Effect.
6.11 Financial Condition. (a) The audited consolidated financial
statements of Xxxxxxxxx and its Subsidiaries dated October 31, 1995,
and the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal year ended on that
date:
(i) were prepared in accordance with GAAP;
(ii) fairly present the financial condition of Xxxxxxxxx and
its Subsidiaries as of the date thereof and results of operations
for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 6.11, show
all material indebtedness and other liabilities, direct or
contingent, of Xxxxxxxxx and its consolidated Subsidiaries as of
the date hereof, including liabilities for taxes, material
commitments and Contingent Obligations required to be disclosed in
accordance with GAAP.
(b) Since October 31, 1995, (assuming that this Agreement were in
effect on such date and thereafter) there has been no Material Adverse
Effect.
6.12 Environmental Matters. Each Company conducts in the ordinary
course of business a review of the effect of existing Environmental
Laws and existing Environmental Claims on its business, operations and
properties, and as a result thereof each Company has reasonably
concluded that, except as specifically disclosed in Schedule 6.12, such
Environmental Laws and Environmental Claims could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse
Effect.
6.13 Regulated Entities. No Company, nor any Person controlling
any Company, nor any Subsidiary, is an "Investment Company" within the
meaning of the Investment Company Act of 1940. No Company is subject to
regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act, any state public
utilities code, or any other Federal or state statute or regulation
limiting its ability to incur Indebtedness.
6.14 No Burdensome Restrictions. None of the Companies nor any
Subsidiary is a party to or bound by any Contractual Obligation, or
subject to any restriction in any Organization Document, or any
Requirement of Law, which could reasonably be expected to have a
Material Adverse Effect.
6.15 Copyrights, Patents, Trademarks and Licenses, etc. To the
best of each Company's knowledge, each Company or its Subsidiaries own
or are licensed or otherwise have the right to use all of the patents,
trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably
necessary for the operation of their respective businesses, without
conflict with the rights of any other Person. To the best knowledge of
each Company, no slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now
contemplated to be employed, by any Company or any Subsidiary infringes
upon any rights held by any other Person. Except as specifically
disclosed in Schedule 6.05, no claim or litigation regarding any of the
foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard
or code is pending or, to the knowledge of each Company, proposed,
which, in either case, could reasonably be expected to have a Material
Adverse Effect.
6.16 Subsidiaries. As of the Closing Date, no Company has any
Subsidiaries other than those specifically disclosed in part (a) of
Schedule 6.16 hereto, which shows the form of organization and
ownership of each such Corporation, and has no equity investments in
any other corporation or entity other than those specifically disclosed
in part (b) of Schedule 6.16. Each Company other than Xxxxxxxxx is a
Wholly Owned Subsidiary of Xxxxxxxxx.
6.17 Insurance. Except as specifically disclosed in Schedule 6.17,
the properties of the Companies and their respective Subsidiaries are
insured with financially sound and reputable insurance companies not
Affiliates of any Company, in such amounts, with such deductibles and
covering such risks as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where
any Company or such Subsidiary operates.
6.18 Swap Obligations. None of the Companies nor any of its
Subsidiaries has incurred any outstanding obligations under any Swap
Contracts, other than Permitted Swap Obligations. Each Company has
voluntarily entered into each Swap Contract to which it is a party
based upon its own independent assessment of its consolidated assets,
liabilities and commitments, in each case as an appropriate means of
mitigating and managing risks associated with such matters, and has not
relied on any swap counterparty or any Affiliate of any swap
counterparty in determining whether to enter into any Swap Contract.
6.19 Full Disclosure. To the best knowledge after due inquiry of
any Responsible Officer of any of the Companies, none of the
representations or warranties made by any Company or any Subsidiary in
the Loan Documents as of the date such representations and warranties
are made or deemed made, and none of the statements contained in any
exhibit, report, statement or certificate furnished by or on behalf of
any Company or any Subsidiary in connection with the Loan Documents
(including the offering and disclosure materials delivered by or on
behalf of any Company to the Banks prior to the Closing Date), contains
any untrue statement of a material fact or omits any material fact
required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they are made, not
misleading as of the time when made or delivered.
ARTICLE VII
AFFIRMATIVE COVENANTS
---------------------
So long as any Bank shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, unless the
Majority Banks waive compliance in writing:
7.01 Financial Statements. The Companies shall deliver to the
Agent, in form and detail satisfactory to the Agent and the Majority
Banks, with sufficient copies for each Bank:
(a) as soon as available, but not later than March 1 of each year,
a copy of the audited consolidated balance sheet of Xxxxxxxxx and its
Subsidiaries as at the end of such year and the related consolidated
statements of income or operations, shareholders' equity and cash flows
for such year, setting forth in each case in comparative form the
figures for the previous fiscal year, and accompanied by the opinion of
Deloitte & Touche or another nationally recognized independent public
accounting firm ("Independent Auditor") which report shall state that
such consolidated financial statements present fairly the financial
position for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years, and together with SEC Form 10K's for
each Company required to file such form with the SEC. The Independent
Auditor's opinion shall not be qualified or limited because of a
restricted or limited examination by the Independent Auditor of any
material portion of any Company's or any Subsidiary's records;
(b) as soon as available, but not later than March 31, June 30,
September 30 and December 31 of each year, a copy for the immediately
preceding fiscal quarter of the unaudited consolidated and
consolidating balance sheets of Xxxxxxxxx and its Subsidiaries as of
the end of such quarter and the related consolidated and consolidating
statements of income, shareholders' equity and cash flows for the
period commencing on the first day and ending on the last day of such
quarter, and certified by a Responsible Officer as fairly presenting,
in accordance with GAAP (subject to ordinary, good faith year-end audit
adjustments), the financial position and the results of operations of
each Company and the Subsidiaries, together with SEC Form 10Q's for
each Company required to file such form with the SEC; and
(c) as soon as available, but not later than March 1 of each year,
a copy of an unaudited consolidating balance sheet of Xxxxxxxxx and its
Subsidiaries as at the end of such year and the related consolidating
statement of income, shareholders' equity and cash flows for such year,
certified by a Responsible Officer as having been developed and used in
connection with the preparation of the financial statements referred to
in Section 7.01(a).
7.02 Certificates; Other Information. The Companies shall furnish
to the Agent, with sufficient copies for each Bank:
(a) concurrently with the delivery of the financial statements
referred to in Sections 7.01(a) and (b), a Compliance Certificate
executed by a Responsible Officer;
(b) except for SEC Forms 10K and 10Q to be delivered pursuant to
Sections 7.01(a) and (c), promptly, and in any event no later than 10
days after the same is made available to any Company's shareholders or
is filed with the SEC, copies of all financial statements and reports
that each Company sends to its shareholders, and copies of all
financial statements and regular, periodical or special reports that
each Company or any Subsidiary may make to, or file with, the SEC;
(c) as soon as available, but in any event no later than the first
to occur of (i) March 1 of each year or (ii) the date on which
Xxxxxxxxx delivers the financial statements required to be delivered
pursuant to Section 7.01(a), a copy of an annual business plan and cash
budget for Xxxxxxxxx, together with an annual business forecast for the
succeeding twelve month period, presented on a quarterly basis, in such
form and in such detail as the Agent or the Majority Banks may require.
(d) upon the request from time to time of the Agent, the Swap
Termination Values, together with a description of the method by which
such values were determined, relating to any then-outstanding Swap
Contracts to which any Company or any of its Subsidiaries is party; and
(e) promptly, such additional information regarding the business,
financial or corporate affairs of each Company or any Subsidiary as the
Agent, at the request of any Bank, may from time to time reasonably
request.
7.03 Notices. The Companies shall promptly notify the Agent and
each Bank of:
(a) the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that foreseeably
will become a Default or Event of Default;
(b) any matter that has resulted or could reasonably result in a
Material Adverse Effect, including: (i) breach or non-performance of,
or any default under, a Contractual Obligation of any Company or any
Subsidiary; (ii) any dispute, litigation, investigation, proceeding or
suspension between any Company or any Subsidiary and any Governmental
Authority; (iii) the commencement of, or any material development in,
any litigation or proceeding affecting any Company or any Subsidiary;
including pursuant to any applicable Environmental Laws; or (iv) the
imposition of any fine or penalty by any Governmental Authority against
or with respect to any facility or plants of any Company or any
Subsidiary;
(c) the occurrence of any of the following events affecting any
Company or any ERISA Affiliate (but in no event more than 10 days after
such event), and deliver to the Agent and each Bank a copy of any
notice with respect to such event that is filed with a Governmental
Authority and any notice delivered by a Governmental Authority to any
Company or any ERISA Affiliate with respect to such event:
(i) an ERISA Event;
(ii) an increase in the Unfunded Pension Liability of any
Pension Plan, including as a result of the adoption of any
amendment to a Plan subject to Section 412 of the Code, that could
reasonably be likely to cause or result in an Event of Default
under Section 9.01(h); or
(iii) the adoption of, or the commencement of contributions
to, any Plan subject to Section 412 of the Code by any Company or
any ERISA Affiliate other than any such Plan in effect and
receiving contributions as of the Closing Date.
(d) any Acquisition, or incurring any Contractual Obligations with
respect to any Acquisition, by any Company or any Subsidiary of any
Company, if the aggregate cash and noncash consideration (including
assumption of liabilities and including all Contingent Obligations) in
connection with such Acquisition is (or could reasonably be expected to
become) $10,000,000 or more; and
(e) any Change in Control or any event or circumstance that is
reasonably likely to result in any Change in Control; and
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the
occurrence referred to therein, and stating what action any Company or
any affected Subsidiary proposes to take with respect thereto and at
what time. Each notice under Section 7.03(a) shall describe with
particularity any and all clauses or provisions of this Agreement or
other Loan Document that have been (or foreseeably will be) breached or
violated.
7.04 Preservation of Corporate and Partnership Existence, etc.
Each Company shall, and shall cause each Subsidiary to:
(a) (i) preserve and maintain in full force and effect (A) its
corporate or partnership existence, as the case may be, and good
standing under the laws of its state or jurisdiction of incorporation
or organization, and (B) all governmental rights, privileges,
qualifications, permits, licenses and franchises necessary or desirable
in the normal conduct of its business; and (ii) use reasonable efforts,
in the ordinary course of business, to preserve its business
organization and goodwill; provided, however, that the foregoing shall
not prevent any transaction permitted by Section 8.02 or 8.03, or the
termination of the existence of any Subsidiary (other than a Company)
if, in the opinion of the Board of Directors of Xxxxxxxxx, such
termination is in the best interest of Xxxxxxxxx and is not otherwise
prohibited by this Agreement; and
(b) preserve or renew and maintain all of its registered patents,
trademarks, trade names and service marks and other intellectual
property assets, the nonpreservation or nonmaintenance of which could
reasonably be expected to have a Material Adverse Effect.
7.05 Maintenance of Property. The Companies shall maintain, and
shall cause each Subsidiary to maintain, and preserve all its property
which is used or useful in its business in good working order and
condition, ordinary wear and tear excepted and make all necessary
repairs thereto and renewals and replacements thereof except where the
failure to do so could not reasonably be expected to have a Material
Adverse Effect. Each Company and each Subsidiary shall use the standard
of care typical in the industry in the operation and maintenance of its
facilities.
7.06 Insurance. The Companies shall maintain, and shall cause each
Subsidiary to maintain, with financially sound and reputable
independent insurers, insurance with respect to its properties and
business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business, of such
types and in such amounts as are customarily carried under similar
circumstances by such other Persons.
7.07 Payment of Obligations. Each Company shall, and shall cause
each Subsidiary to, pay and discharge as the same shall become due and
payable, all their respective material obligations and liabilities,
including:
(a) all material tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same
are being contested in good faith by appropriate proceedings and
adequate reserves in accordance with GAAP are being maintained by each
Company or such Subsidiary;
(b) all lawful material claims which, if unpaid, would by law
become a Lien upon its property; and
(c) all Indebtedness, as and when due and payable (but subject to
any subordination provisions contained in any instrument or agreement
evidencing such Indebtedness), unless contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by each Company or such Subsidiary, except to the
extent that the nonpayment thereof would not result in or reasonable be
expected to result in a Material Adverse Effect.
7.08 Compliance with Laws. The Companies shall comply, and shall
cause each Subsidiary to comply, in all respects with all Requirements
of Law of any Governmental Authority having jurisdiction over it or its
business or properties (including the Federal Fair Labor Standards
Act), unless such noncompliance is being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by each Company or such Subsidiary with respect
thereto, except to the extent any such noncompliance, individually or
in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
7.09 Inspection of Property and Books and Records. The Companies
shall maintain and shall cause each Subsidiary to maintain proper books
of record and account, in which full, true and correct entries in
conformity with GAAP shall be made of all financial transactions and
matters involving the assets and business of each Company and such
Subsidiary. The Companies shall permit, and shall cause each Subsidiary
to permit, representatives and independent contractors of the Agent or
any Bank to visit and inspect any of their respective properties, to
examine their respective corporate, financial and operating records,
and make copies thereof or abstracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants at such
reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Companies;
provided, however, when an Event of Default exists the Agent or any
Bank may do any of the foregoing at the expense of the Companies at any
time during normal business hours and without advance notice.
7.10 Environmental Laws. Each Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its
property in compliance with all Environmental Laws, if any
noncompliance, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
7.11 Use of Proceeds. The Companies shall use the proceeds of the
Loans for working capital, other general corporate purposes and for
nonhostile Acquisitions, in each case not in contravention of any
Requirement of Law or of any Loan Document; provided, however, that no
Company shall directly or indirectly use the proceeds of the Loans for
any Acquisition of any Person if such Acquisition has not been approved
by the board of directors (or other body exercising similar authority)
of such Person.
ARTICLE VIII
NEGATIVE COVENANTS
------------------
So long as any Bank shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, unless the
Majority Banks waive compliance in writing:
8.01 Limitation on Liens. The Companies shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, make,
create, incur, assume or suffer to exist any Lien upon or with respect
to any part of its property, whether now owned or hereafter acquired,
other than the following ("Permitted Liens"):
(a) any Lien existing on property of any of the Companies or any
of their respective Subsidiaries on the Closing Date securing
Indebtedness outstanding on the Closing Date; provided, however, that
if all such Indebtedness so secured by such Liens exceeds $1,000,000 in
the aggregate on the Closing Date, then no such Liens shall be
permitted under this Section 8.01(a) except for those disclosed in
Schedule 8.01(a);
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental
charges which are not delinquent or remain payable without penalty, or
to the extent that non-payment thereof is permitted by Section 7.07(a),
provided that no notice of lien has been filed or recorded under the
Code;
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the
ordinary course of business which are not delinquent or remain payable
without penalty or which are being contested in good faith and by
appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
social security legislation;
(f) Liens on the property of any Company or its Subsidiaries
securing (i) the nondelinquent performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, (ii)
contingent obligations on surety and appeal bonds, and (iii) other
nondelinquent obligations of a like nature; in each case, incurred in
the ordinary course of business;
(g) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and
all such liens in the aggregate at any time outstanding for the
Companies and their respective Subsidiaries do not exceed $2,500,000;
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or
interfere with the ordinary conduct of the businesses of the Companies
and their respective Subsidiaries;
(i) Liens on assets of corporations which become Subsidiaries
after the date of this Agreement, provided, however, that such Liens
existed at the time the respective corporations became Subsidiaries and
were not created in anticipation thereof;
(j) purchase money security interests on any property acquired or
held by any of the Companies or their respective Subsidiaries in the
ordinary course of business, securing Indebtedness incurred or assumed
for the purpose of financing all or any part of the cost of acquiring
such property; provided that (i) any such Lien attaches to such
property concurrently with or within 20 days after the acquisition
thereof, (ii) such Lien attaches solely to the property so acquired in
such transaction, (iii) the principal amount of the debt secured
thereby does not exceed 100% of the cost of such property, and (iv) the
principal amount of the Indebtedness secured by any and all such
purchase money security interests shall not at any time exceed,
together with Indebtedness permitted under Section 8.05(c),
$10,000,000;
(k) Liens securing obligations in respect of capital leases on
assets subject to such leases, provided that such capital leases are
otherwise permitted hereunder;
(l) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained
with a creditor depository institution; provided that (i) such deposit
account is not a dedicated cash collateral account and is not subject
to restrictions against access by any of the Companies in excess of
those set forth by regulations promulgated by the FRB, and (ii) such
deposit account is not intended by any of the Companies or any of their
respective Subsidiaries to provide collateral to the depository
institution; and
(m) Liens arising pursuant to Section 412(n) of the Code or
Section 4069(a) of ERISA if (i) the delinquent payments to which the
Lien relates are made within ten (10) days after the Company or any
Subsidiary learns of the failure to make payment or (ii) the obligation
to make such payments is being contested in good faith and by
appropriate proceedings if adequate reserves with respect thereto are
maintained on the books of the Companies, in accordance with GAAP.
8.02 Disposition of Assets. The Companies shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, sell,
assign, lease, convey, transfer or otherwise dispose of (whether in one
or a series of transactions) any property (including accounts and notes
receivable, with or without recourse) or enter into any agreement to do
any of the foregoing, except:
(a) dispositions of inventory, or used, worn-out or surplus
equipment, all in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied
to the purchase price of such replacement equipment; and
(c) dispositions not otherwise permitted hereunder which are made
for fair market value; provided, that (i) at the time of any
disposition, no Default or Event of Default shall exist or shall result
from such disposition, (ii) the aggregate sales price from such
disposition shall be paid in cash, and (iii) the aggregate value of all
assets so sold by the Companies and their respective Subsidiaries,
together, shall not exceed in any 12-month period ten percent (10%) of
Consolidated Total Assets as of the end of the immediately preceding
fiscal year.
8.03 Consolidations and Mergers. The Companies shall not, and
shall not suffer or permit any Subsidiary to, merge, consolidate with
or into, or convey, transfer, lease or otherwise dispose of (whether in
one transaction or in a series of transactions all or substantially all
of its assets (whether now owned or hereafter acquired) to or in favor
of any Person, except:
(a) any Subsidiary (other than a Company) may merge with any of
the Companies, provided that the Companies shall be the continuing or
surviving corporation, or with any one or more Subsidiaries, provided
that if any transaction shall be between a Subsidiary and a Wholly
Owned Subsidiary, the Wholly Owned Subsidiary shall be the continuing
or surviving corporation;
(b) any Subsidiary (other than a Company) may sell all or
substantially all of its assets (upon voluntary liquidation or
otherwise), to any of the Companies; and
(c) any Subsidiary (other than a Company) may merge with any other
Person, whether or not such Subsidiary shall be the surviving
corporation, if the aggregate value of the assets of all such
Subsidiaries involved in the transaction or transactions, together,
does not exceed in any 12-month period ten percent (10%) of
Consolidated Total Assets as of the end of the immediately preceding
fiscal year.
8.04 Loans and Investments. The Companies shall not purchase or
acquire, or suffer or permit any Subsidiary to purchase or acquire, or
make any commitment therefor, any capital stock, equity interest, or
any obligations or other securities of, or any interest in, any Person,
or make or commit to make any Acquisitions, or make or commit to make
any advance, loan, extension of credit or capital contribution to or
any other investment in, or joint venture with, any Person including
any Affiliate of any of the Companies (together, "Investments"), except
for:
(a) Investments held by any of the Companies or their respective
Subsidiaries in the form of cash equivalents or short term marketable
securities;
(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in
the ordinary course of business of the Companies and their
Subsidiaries;
(c) Investments not otherwise prohibited by this Agreement or any
of the other Loan Documents by any Company in any other Company;
(d) extensions of credit by any of the Companies to any of their
respective Wholly Owned Subsidiaries that are not Companies, or by any
of such Wholly Owned Subsidiaries to another such Wholly Owned
Subsidiary, in an aggregate principal amount at any time outstanding
for all such extensions of credit to such Persons not in excess of 25%
of Consolidated Net Worth;
(e) Investments not otherwise permitted pursuant to subsections
(a), (b), (c) or (d) of this Section in, or Acquisitions of, Persons
engaged in general industrial manufacturing or other lines of business
substantially similar to the lines of business of Xxxxxxxxx or its
Subsidiaries, provided that all of the following are true at the time
of any such Investment or Acquisition and at the time that any of the
Companies or any Subsidiary incurs any Contractual Obligation with
respect to any such Investment or Acquisition:
(i) the amount of all Investments permitted pursuant to this
Section 8.04(e), including all Indebtedness incurred or assumed in
connection with any such Investment, does not exceed in the
aggregate $150,000,000;
(ii) no Default or Event of Default shall have occurred and be
continuing or result therefrom; and
(iii) with respect to Acquisitions of any Person with annual
sales revenue for the immediately preceding consecutive 12 months
in excess of five percent (5%) of Xxxxxxxxx'x consolidated sales
revenue for its immediately preceding fiscal year (or, at the
discretion of the Majority Banks, the immediately preceding four
fiscal quarters) Xxxxxxxxx has presented to the Agent and the
Banks pro forma financial projections, using the most recent
audited historical results of the Person subject to such
Acquisition and using the most recent historical results of the of
the Companies and their Subsidiaries delivered to the Agent and
the Banks pursuant to Section 7.01 hereof, which demonstrate to
the satisfaction of the Agent and the Majority Banks that for the
12-month period following the consummation of such Acquisition,
the Companies will remain in compliance with Sections 8.15, 8.16
and 8.17 of this Agreement; and
(f) Investments constituting Permitted Swap Obligations or
payments or advances under Swap Contracts relating to Permitted Swap
Obligations.
8.05 Limitation on Indebtedness. The Companies shall not, and
shall not suffer or permit any Subsidiary to, create, incur, assume,
suffer to exist, or otherwise become or remain directly or indirectly
liable with respect to, any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness existing on the Closing Date and set forth in
Schedule 8.05(b) and any extensions and renewals of such Indebtedness
on terms otherwise permitted pursuant to this Agreement, so long as the
principal amount is not increased, additional collateral is not given
and unsecured Indebtedness is not made secured Indebtedness;
(c) Indebtedness secured by Liens permitted by Section 8.01(j) in
an aggregate amount outstanding not to exceed $10,000,000;
(d) Indebtedness owing by any Company to any other Company that is
not otherwise prohibited by this Agreement or any of the other Loan
Documents;
(e) Indebtedness arising as a consequence of Investments permitted
pursuant to Section 8.04(d); and
(f) Indebtedness owing by a Subsidiary of Xxxxxxxxx that is not a
Company to a Person other than Xxxxxxxxx or any Subsidiary of Xxxxxxxxx
provided that the aggregate amount of all such Indebtedness outstanding
at any time does not exceed 25% of Consolidated Net Worth as set forth
in Xxxxxxxxx'x quarterly or annual consolidated financial statements
most recently delivered to the Agent pursuant to Section 7.01.
(g) Indebtedness not otherwise permitted pursuant to subsection
(a) through (f) of this Section, if (i) such Indebtedness is incurred
or arises with respect to a transaction not otherwise prohibited by
this Agreement and (ii) immediately upon becoming obligated with
respect to such Indebtedness, the Leverage Ratio would not exceed 0.60
to 1.00.
8.06 Transactions with Affiliates. The Companies shall not, and
shall not suffer or permit any Subsidiary to, enter into any
transaction with any Affiliate of the Companies, except upon fair and
reasonable terms no less favorable to such Company or such Subsidiary
than would obtain in a comparable arm's-length transaction with a
Person not an Affiliate of the Companies or such Subsidiary.
8.07 Use of Proceeds. (a) The Companies shall not, and shall not
suffer or permit any Subsidiary to, use any portion of the Loan
proceeds, directly or indirectly, (i) to purchase or carry Margin
Stock, (ii) to repay or otherwise refinance indebtedness of the
Companies or others incurred to purchase or carry Margin Stock, (iii)
to extend credit for the purpose of purchasing or carrying any Margin
Stock, or (iv) to acquire any security in any transaction that is
subject to Section 13 or 14 of the Exchange Act.
(b) The Companies shall not, directly or indirectly, use any
portion of the Loan proceeds (i) knowingly to purchase Ineligible
Securities from the Arranger during any period in which the Arranger
makes a market in such Ineligible Securities, (ii) knowingly to
purchase during the underwriting or placement period Ineligible
Securities being underwritten or privately placed by the Arranger, or
(iii) to make payments of principal or interest on Ineligible
Securities underwritten or privately placed by the Arranger and issued
by or for the benefit of any of the Companies or any Affiliate of the
Companies. The Arranger is a registered broker-dealer and permitted to
underwrite and deal in certain Ineligible Securities; and "Ineligible
Securities" means securities which may not be underwritten or dealt in
by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1933 (12 U.S.C. XXXXXXX00, Seventh), as amended.
8.08 Contingent Obligations. The Companies shall not, and shall
not suffer or permit any Subsidiary to, create, incur, assume or suffer
to exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course
of business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of the Companies and their respective
Subsidiaries existing as of the Closing Date and listed in Schedule
8.08(c); and
(d) Contingent Obligations with respect to Surety Instruments
incurred in the ordinary course of business and which otherwise
constitute Indebtedness permitted pursuant to Section 8.05.
(e) Guaranty Obligations incurred in the ordinary course of
business which otherwise constitute Indebtedness permitted pursuant to
Section 8.05 and which in the aggregate do not exceed 25% of
Consolidated Net Worth.
8.09 [Intentionally omitted.]
8.10 Restricted Payments. The Companies shall not, and shall not
suffer or permit any Subsidiary to, declare or make any dividend
payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any shares of any class of its
capital stock, or purchase, redeem or otherwise acquire for value any
shares of its capital stock or any warrants, rights or options to
acquire such shares, now or hereafter outstanding; except that any of
the Companies may:
(a) declare and make dividend payments or other distributions
payable solely in its common stock;
(b) purchase, redeem or otherwise acquire shares of its common
stock or warrants or options to acquire any such shares with the
proceeds received from the substantially concurrent issue of new shares
of its common stock; and
(c) declare or pay cash dividends to its stockholders and
purchase, redeem or otherwise acquire shares of its capital stock or
warrants, rights or options to acquire any such shares for cash solely
out of 50% of net income of such Company and its Subsidiaries in any
fiscal year and computed on a cumulative consolidated basis, provided,
that, immediately after giving effect to such proposed action, no
Default or Event of Default would exist.
8.11 ERISA. The Companies shall not, and shall not suffer or
permit any of its ERISA Affiliates to: (a) engage in a prohibited
transaction or violation of the fiduciary responsibility rules with
respect to any Plan; (b) cause or permit any Plan which is qualified
under subsection 401(a) of the Code to lose such qualification; or (c)
fail to make all required contributions to any Plan subject to
subsection 412 of the Code; but only to the extent that any such act or
failure to act, separately or together with all other such acts or
failures to act, in any of the foregoing clauses (a), (b) or (c) has
resulted or could reasonably expected to result in liability of the
Companies in an aggregate amount in excess of $1,000,000; or (d) engage
in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA
8.12 Change in Business. Except as permitted pursuant to Section
8.04, the Companies shall not, and shall not suffer or permit any
Subsidiary to, engage in any material line of business substantially
different from those lines of business carried on by the Companies and
their respective Subsidiaries on the date hereof, including as a
consequence of any Acquisition.
8.13 Change in Fiscal Year. Xxxxxxxxx shall not change its fiscal
year or the fiscal year of any of its consolidated Subsidiaries.
8.14 [Intentionally omitted.]
8.15 Minimum Consolidated Net Worth. The Companies shall not
permit, as of the last day of any fiscal quarter, Consolidated Net
Worth to be less than the sum of:
(a) $98,000,000, plus
(b) 50% of Consolidated Net Income from January 31, 1996 through
the end of each fiscal quarter thereafter, determined quarterly on a
consolidated basis and not reduced by any Consolidated Net Loss, plus
(c) 75% of the Net Securities Proceeds arising on or after the
Closing Date to the date of determination.
As used herein, "Net Securities Proceeds" means, with respect to any
sale or issuance of equity securities (whether common or preferred,
options, warrant or capital appreciation rights, but excluding any
sales or issuances of stock pursuant to employee stock purchase plans,
employee stock option plans or other employee benefit plans), the
excess of (A) the gross cash and, to the extent acceptable to the Agent
and the Majority Banks, noncash proceeds received or receivable by
Xxxxxxxxx or any Subsidiary from such disposition minus (B) the sum of
(i) all reasonable Attorney Costs and underwriting and accounting fees
and disbursements and government fees actually paid (or reasonably
expected to be paid during the fiscal year in which such sale or
issuance occurs) in connection with such sale or issuance which are not
payable to Xxxxxxxxx or to any Affiliate of Xxxxxxxxx or any
Subsidiary; (ii) all taxes actually paid in connection with such sale
or issuance; and (iii) the value of such acceptable noncash proceeds.
8.16 Maximum Leverage Ratio. The Companies shall not permit, as of
the last day of any fiscal quarter, the Leverage Ratio to exceed 0.60
to 1.00.
8.17 Minimum Fixed Charge Coverage Ratio. The Companies shall not
permit, as of the last day of any fiscal quarter, the ratio of (a)
EBITAR, measured for the period consisting of the four consecutive
fiscal quarters ending on such day, to (b) the sum of interest expense
plus Rental Expense, measured for the period consisting of the four
consecutive fiscal quarters ending on such day, which were deductible
in determining Consolidated Net Income or Consolidated Net Loss for
such period, to be less than 2.00 to 1.00. For purposes of calculating
compliance with this Section 8.17, amounts that would be included in
either EBITAR or interest expense and Rental Expense on account of any
Acquisitions made by any of the Companies or their Subsidiaries after
January 31, 1996 will be excluded unless the Agent and the Banks have
been provided with independent verification of such historical results.
ARTICLE IX
EVENTS OF DEFAULT
-----------------
9.01 Event of Default. Any of the following shall constitute an
"Event of Default":
(a) Non-Payment. Any Company fails to pay, (i) when and as
required to be paid herein, any amount of principal of any Loan, or
(ii) within five (5) days after the same becomes due, any interest, fee
or any other amount payable hereunder or under any other Loan Document;
or
(b) Representation or Warranty. Any representation or warranty by
any of the Companies or any of their respective Subsidiaries made or
deemed made herein, in any other Loan Document, or which is contained
in any certificate, document or financial or other statement by any of
the Companies, any of their respective Subsidiaries, or any Responsible
Officer, furnished at any time under this Agreement, or in or under any
other Loan Document, is incorrect in any material respect on or as of
the date made or deemed made; or
(c) Specific Defaults. The of the Companies fails to perform or
observe any term, covenant or agreement contained in Article VII (other
than any of Sections 7.06, 7.07, 7.08 or 7.10) or in Article VIII; or
(d) Other Defaults. Any of the Companies fails to perform or
observe any other term or covenant contained in this Agreement or any
other Loan Document, and such default shall continue unremedied for a
period of 20 days after the earlier of (i) the date upon which a
Responsible Officer knew or reasonably should have known of such
failure or (ii) the date upon which written notice thereof is given to
such Company by the Agent or any Bank; or
(e) Cross-Default. (i) Any Company or any Subsidiary (A) fails to
make any payment in respect of any Indebtedness or Contingent
Obligation (other than in respect of Swap Contracts), having an
aggregate principal amount (including undrawn committed or available
amounts and including amounts owing to all creditors under any combined
or syndicated credit arrangement) of more than $2,500,000 when due
(whether by scheduled maturity, required prepayment, acceleration,
demand, or otherwise); or (B) fails to perform or observe any other
condition or covenant, or any other event shall occur or condition
exist, under any agreement or instrument relating to any such
Indebtedness or Contingent Obligation, and such failure continues after
the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure if the effect of such
failure, event or condition is to cause, or to permit the holder or
holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders
or beneficiary or beneficiaries) to cause such Indebtedness to be
declared to be due and payable prior to its stated maturity, or such
Contingent Obligation to become payable or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an
Early Termination Date (as defined in such Swap Contract) resulting
from (A) any event of default under such Swap Contract as to which any
Company or any Subsidiary is the Defaulting Party (as defined in such
Swap Contract) or (2) any Termination Event (as so defined) as to which
any Company or any Subsidiary is an Affected Party (as so defined),
and, in either event, the Swap Termination Value owed by such Company
or such Subsidiary as a result thereof is greater than $250,000; or
(f) Insolvency; Voluntary Proceedings. Any Company or any
Subsidiary (i) ceases or fails to be solvent, or generally fails to
pay, or admits in writing its inability to pay, its debts as they
become due, subject to applicable grace periods, if any, whether at
stated maturity or otherwise; (ii) voluntarily ceases to conduct its
business in the ordinary course; (iii) commences any Insolvency
Proceeding with respect to itself; or (iv) takes any action to
effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against any Company or any Subsidiary,
or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial part of any
Company's or any Subsidiary's properties, and any such proceeding or
petition shall not be dismissed, or such writ, judgment, warrant of
attachment, execution or similar process shall not be released, vacated
or fully bonded within 60 days after commencement, filing or levy; (ii)
any Company or any Subsidiary admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for
relief (or similar order under non-U.S. law) is ordered in any
Insolvency Proceeding; or (iii) any Company or any Subsidiary
acquiesces in the appointment of a receiver, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor),
or other similar Person for itself or a substantial portion of its
property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a
Pension Plan or Multiemployer Plan which has resulted or could
reasonably be expected to result in liability of the Companies under
Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC;
(ii) any Unfunded Pension Liability with respect to any or all Pension
Plans shall exist; or (iii) the Companies or any ERISA Affiliate shall
fail to pay when due, after the expiration of any applicable grace
period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan; but
only to the extent that any of the foregoing, separately or in the
aggregate, has or could reasonably be expected to have a Material
Adverse Effect; or
(i) Monetary Judgments. One or more noninterlocutory judgments,
noninterlocutory orders, decrees or arbitration awards is entered
against any of the Companies or any of their respective Subsidiaries
involving in the aggregate a liability (to the extent not covered by
independent third-party insurance as to which the insurer does not
dispute coverage) as to any single or related series of transactions,
incidents or conditions, of $1,000,000 or more, and the same shall
remain unsatisfied, unvacated and unstayed pending appeal for a period
of 10 days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against any of the Companies or any of their
respective Subsidiaries which does or would reasonably be expected to
have a Material Adverse Effect, and there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(k) Change of Control. There occurs any Change of Control; or
(l) Loss of Licenses. Any Governmental Authority revokes or fails
to renew any material license, permit or franchise any of the Companies
or any of their Subsidiaries, or any of the Companies or any of their
respective Subsidiaries for any reason loses any material license,
permit or franchise, or any of the Companies or any of their
Subsidiaries suffers the imposition of any restraining order, escrow,
suspension or impound of funds in connection with any proceeding
(judicial or administrative) with respect to any material license,
permit or franchise; or
(m) Adverse Change. There occurs a Material Adverse Effect; or
(n) Guarantor Defaults. Any Guarantor fails in any material
respect to perform or observe any term, covenant or agreement as a
guarantor of the Obligations pursuant to Section 11.19, or the guaranty
set forth therein is for any reason partially (including with respect
to future advances) or wholly revoked or invalidated, or otherwise
ceases to be in full force and effect, or any Company as a guarantor
(or any other Person) contests in any manner the validity or
enforceability thereof or denies that it has any further liability or
obligation thereunder; or any event described at subsections (f) or (g)
of this Section occurs with respect to any Guarantor.
9.02 Remedies. If any Event of Default occurs, the Agent shall, at
the request of, or may, with the consent of, the Majority Banks,
(a) declare the commitment of each Bank to make Loans to be
terminated, whereupon such commitments shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or
payable hereunder or under any other Loan Document to be immediately
due and payable, without presentment, demand, protest or other notice
of any kind, all of which are hereby expressly waived by each of the
Companies; and
(c) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or
applicable law; provided, however, that upon the occurrence of any
event specified in subsection (f) or (g) of Section 9.01 (in the case
of clause (i) of subsection (g) upon the expiration of the 60-day
period mentioned therein), the obligation of each Bank to make Loans
shall automatically terminate and the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable without further act of the Agent
or any Bank.
9.03 Rights Not Exclusive. The rights provided for in this
Agreement and the other Loan Documents are cumulative and are not
exclusive of any other rights, powers, privileges or remedies provided
by law or in equity, or under any other instrument, document or
agreement now existing or hereafter arising.
9.04 Certain Financial Covenant Defaults. In the event that, after
taking into account any extraordinary charge to earnings taken or to be
taken as of the end of any fiscal period of any Company (a "Charge"),
and if solely by virtue of such Charge, there would exist an Event of
Default due to the breach of any of Sections 8.15, 8.16 or 8.17 as of
such fiscal period end date, such Event of Default shall be deemed to
arise upon the earlier of (a) the date after such fiscal period end
date on which such Company announces publicly it will take, is taking
or has taken such Charge (including an announcement in the form of a
statement in a report filed with the SEC) or, if such announcement is
made prior to such fiscal period end date, the date that is such fiscal
period end date, and (b) the date such Company delivers to the Agent
its audited annual or unaudited quarterly financial statements in
respect of such fiscal period reflecting such Charge as taken.
ARTICLE X
THE AGENT
---------
10.01 Appointment and Authorization; "Agent.
(a) Each Bank hereby irrevocably (subject to Section 10.09)
appoints, designates and authorizes the Agent to take such action on
its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained
elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly
set forth herein, nor shall the Agent have or be deemed to have any
fiduciary relationship with any Bank, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise
exist against the Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or
other implied (or express) obligations arising under agency doctrine of
any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties.
(b) The Issuing Bank shall act on behalf of the Banks with respect
to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may agree
at the request of the Majority Banks to act for such Issuing Bank with
respect thereto; provided, however, that the Issuing Bank shall have
all of the benefits and immunities (i) provided to the Agent in this
Article X with respect to any acts taken or omissions suffered by the
Issuing Bank in connection with Letters of Credit Issued by it
(including the Existing Letters of Credit) or proposed to be Issued by
it and the application and agreements for letters of credit pertaining
to the Letters of Credit as fully as if the term "Agent," as used in
this Article X, included the Issuing Bank with respect to such acts or
omissions, and (ii) as additionally provided in this Agreement with
respect to the Issuing Bank.
(c) Without limiting the generality of the foregoing subsections,
the use of the term "agent" in this Agreement with reference to the
Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable
law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative
relationship between independent contracting parties.
(d) The provisions of this Article X shall survive the payment of
all Obligations hereunder and inure to the benefit of BofA, including
after its resignation or replacement as the Agent, as to any actions
taken or omitted to be taken by BofA while it was the Agent.
10.02 Delegation of Duties. The Agent may execute any of its
duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. The Agent
shall not be responsible for the negligence or misconduct of any agent
or attorney-in-fact that it selects with reasonable care.
10.03 Liability of Agent. None of the Agent-Related Persons shall
(i) be liable for any action taken or omitted to be taken by any of
them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except for its own
gross negligence or willful misconduct), or (ii) be responsible in any
manner to any of the Banks for any recital, statement, representation
or warranty made by any of the Companies or any Subsidiary or Affiliate
of the Companies, or any officer thereof, contained in this Agreement
or in any other Loan Document, or in any certificate, report, statement
or other document referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan
Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for any
failure of the Companies or any other party to any Loan Document to
perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Bank to ascertain or to
inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the
Companies or any of their Subsidiaries or Affiliates.
10.04 Reliance by Agent. (a) The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any writing, resolution,
notice, consent, certificate, affidavit, letter, telegram, facsimile,
telex or telephone message, statement or other document or conversation
believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons, and upon advice and statements
of legal counsel (including counsel to the Companies), independent
accountants and other experts selected by the Agent. The Agent shall be
fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Majority Banks as it deems appropriate
and, if it so requests, it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any other
Loan Document in accordance with a request or consent of the Majority
Banks and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Bank that has executed this Agreement
shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter either sent by the Agent
to such Bank for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to the Bank.
10.05 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Agent for the account of
the Banks, unless the Agent shall have received written notice from a
Bank or a Company referring to this Agreement, describing such Default
or Event of Default and stating that such notice is a "notice of
default." The Agent will notify the Banks of its receipt of any such
notice. The Agent shall take such action with respect to such Default
or Event of Default as may be requested by the Majority Banks in
accordance with Article IX; provided, however, that unless and until
the Agent has received any such request, the Agent may (but shall not
be obligated to) take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem
advisable or in the best interest of the Banks.
10.06 Credit Decision. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it,
and that no act by the Agent hereinafter taken, including any review of
the affairs of the Companies and their respective Subsidiaries, shall
be deemed to constitute any representation or warranty by any
Agent-Related Person to any Bank. Each Bank represents to the Agent
that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other
condition and credit worthiness of the Companies and their respective
Subsidiaries, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter
into this Agreement and to extend credit to the Companies hereunder.
Each Bank also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make
its own credit analysis, appraisals and decisions in taking or not
taking action under this Agreement and the other Loan Documents, and to
make such investigations as it deems necessary to inform itself as to
the business, prospects, operations, property, financial and other
condition and credit worthiness of the Companies and their respective
Subsidiaries. Except for notices, reports and other documents expressly
herein required to be furnished to the Banks by the Agent, the Agent
shall not have any duty or responsibility to provide any Bank with any
credit or other information concerning the business, prospects,
operations, property, financial and other condition or credit
worthiness of the Companies which may come into the possession of any
of the Agent-Related Persons.
10.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Banks shall indemnify upon
demand the Agent-Related Persons (to the extent not reimbursed by or on
behalf of the Companies and without limiting the obligation of the
Companies to do so), pro rata, from and against any and all Indemnified
Liabilities; provided, however, that no Bank shall be liable for the
payment to the Agent-Related Persons of any portion of such Indemnified
Liabilities resulting solely from such Person's gross negligence or
willful misconduct. Without limitation of the foregoing, each Bank
shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by
the Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or
on behalf of the Companies. The undertaking in this Section shall
survive the payment of all Obligations hereunder and the resignation or
replacement of the Agent.
10.08 Agent in Individual Capacity. BofA and its Affiliates may
make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other
business with the Companies and their respective Subsidiaries and
Affiliates as though BofA were not the Agent hereunder and without
notice to or consent of the Banks. The Banks acknowledge that, pursuant
to such activities, BofA or its Affiliates may receive information
regarding any of the Companies or their Affiliates (including
information that may be subject to confidentiality obligations in favor
of such Company or such Subsidiary) and acknowledge that the Agent
shall be under no obligation to provide such information to them. With
respect to its Loans, BofA shall have the same rights and powers under
this Agreement as any other Bank and may exercise the same as though it
were not the Agent, and the terms "Bank" and "Banks" include BofA in
its individual capacity.
10.09 Successor Agent. The Agent may, and at the request of the
Majority Banks shall, resign as Agent upon 30 days' notice to the
Banks. If the Agent resigns under this Agreement, the Majority Banks
shall appoint from among the Banks a successor agent for the Banks. If
no successor agent is appointed prior to the effective date of the
resignation of the Agent, the Agent may appoint, after consulting with
the Banks and the Companies, a successor agent from among the Banks.
Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties
of the retiring Agent and the term "Agent" shall mean such successor
agent and the retiring Agent's appointment, powers and duties as Agent
shall be terminated. After any retiring Agent's resignation hereunder
as Agent, the provisions of this Article X and Sections 11.04 and 11.05
shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement. If no successor
agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring
Agent's resignation shall nevertheless thereupon become effective and
the Banks shall perform all of the duties of the Agent hereunder until
such time, if any, as the Majority Banks appoint a successor agent as
provided for above.
10.10 Withholding Tax. (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank
claims exemption from, or a reduction of, U.S. withholding tax under
Sections 1441 or 1442 of the Code, such Bank agrees with and in favor
of the Agent, to deliver to the Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form 1001 before the payment
of any interest in the first calendar year and before the payment
of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it
is effectively connected with a United States trade or business of
such Bank, two properly completed and executed copies of IRS Form
4224 before the payment of any interest is due in the first
taxable year of such Bank and in each succeeding taxable year of
such Bank during which interest may be paid under this Agreement;
and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to
exemption from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent of any change in
circumstances which would modify or render invalid any claimed
exemption or reduction.
(b) If any Bank claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form
1001 and such Bank sells, assigns, grants a participation in, or
otherwise transfers all or part of the Obligations of the Companies to
such Bank, such Bank agrees to notify the Agent of the percentage
amount in which it is no longer the beneficial owner of Obligations of
the Companies to such Bank. To the extent of such percentage amount,
the Agent will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations
of the Companies to such Bank, such Bank agrees to undertake sole
responsibility for complying with the withholding tax requirements
imposed by Sections 1441 and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to
such Bank an amount equivalent to the applicable withholding tax after
taking into account such reduction. However, if the forms or other
documentation required by subsection (a) of this Section are not
delivered to the Agent, then the Agent may withhold from any interest
payment to such Bank not providing such forms or other documentation an
amount equivalent to the applicable withholding tax imposed by Sections
1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not
properly withhold tax from amounts paid to or for the account of any
Bank (because the appropriate form was not delivered or was not
properly executed, or because such Bank failed to notify the Agent of a
change in circumstances which rendered the exemption from, or reduction
of, withholding tax ineffective, or for any other reason) such Bank
shall indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax or otherwise, including penalties and
interest, and including any taxes imposed by any jurisdiction on the
amounts payable to the Agent under this Section, together with all
costs and expenses (including Attorney Costs). The obligation of the
Banks under this subsection shall survive the payment of all
Obligations and the resignation or replacement of the Agent.
ARTICLE XI
MISCELLANEOUS
-------------
11.01 Amendments and Waivers. No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent
with respect to any departure by the Companies or any applicable
Subsidiary therefrom, shall be effective unless the same shall be in
writing and signed by the Majority Banks (or by the Agent at the
written request of the Majority Banks) and the Companies and
acknowledged by the Agent, and then any such waiver or consent shall be
effective only in the specific instance and for the specific purpose
for which given; provided, however, that no such waiver, amendment, or
consent shall, unless in writing and signed by all the Banks and
Companies and acknowledged by the Agent, do any of the following:
(a) increase or extend the Commitment of any Bank (or reinstate
any Commitment terminated pursuant to Section 9.02);
(b) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest, fees or
other amounts due to the Banks (or any of them) hereunder or under any
other Loan Document;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (ii) below) any fees or other
amounts payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Banks or
any of them to take any action hereunder; or
(e) amend this Section, or Section 2.14, or any provision herein
providing for consent or other action by all Banks;
and, provided further, that (i) no amendment, waiver or consent shall,
unless in writing and signed by the Agent in addition to the Majority
Banks or all the Banks, as the case may be, affect the rights or duties
of the Agent under this Agreement or any other Loan Document, and (ii)
the Fee Letters may be amended, or rights or privileges thereunder
waived, in a writing executed by the parties thereto.
11.02 Notices. (a) All notices, requests, consents, approvals,
waivers and other communications shall be in writing (including, unless
the context expressly otherwise provides, by facsimile transmission,
provided that any matter transmitted by the Companies by facsimile (i)
shall be immediately confirmed by a telephone call to the recipient at
the number specified on Schedule 11.02, and (ii) shall be followed
promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered, to the address or facsimile number specified for notices
on Schedule 11.02; or, as directed to the Companies or the Agent, to
such other address as shall be designated by such party in a written
notice to the other parties, and as directed to any other party, at
such other address as shall be designated by such party in a written
notice to the Companies and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when
delivered for overnight (next-day) delivery, or transmitted in legible
form by facsimile machine, respectively, or if mailed, upon the third
Business Day after the date deposited into the U.S. mail, or if
delivered, upon delivery; except that notices pursuant to Article II or
X to the Agent shall not be effective until actually received by the
Agent.
(c) Any agreement of the Agent and the Banks herein to receive
certain notices by telephone or facsimile is solely for the convenience
and at the request of the Companies. The Agent and the Banks shall be
entitled to rely on the authority of any Person purporting to be a
Person authorized by any of the Companies to give such notice and the
Agent and the Banks shall not have any liability to any of the
Companies or other Person on account of any action taken or not taken
by the Agent or the Banks in reliance upon such telephonic or facsimile
notice. The obligation of the Companies to repay the Loans shall not be
affected in any way or to any extent by any failure by the Agent and
the Banks to receive written confirmation of any telephonic or
facsimile notice or the receipt by the Agent and the Banks of a
confirmation which is at variance with the terms understood by the
Agent and the Banks to be contained in the telephonic or facsimile
notice.
11.03 No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Agent or any Bank, any
right, remedy, power or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege.
11.04 Costs and Expenses. The Companies shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Agent)
and the Arranger within five Business Days after demand for all costs
and expenses incurred by BofA (including in its capacity as Agent) or
the Arranger in connection with the development, preparation, delivery,
administration and execution of, and any amendment, supplement, waiver
or modification to (in each case, whether or not consummated), this
Agreement, any Loan Document and any other documents prepared in
connection herewith or therewith, and the consummation of the
transactions contemplated hereby and thereby, including reasonable
Attorney Costs incurred by BofA (including in its capacity as Agent)
with respect thereto; and
(b) pay or reimburse the Agent, the Arranger and each Bank within
five Business Days after demand for all costs and expenses (including
Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under
this Agreement or any other Loan Document during the existence of an
Event of Default or after acceleration of the Loans (including in
connection with any "workout" or restructuring regarding the Loans, and
including in any Insolvency Proceeding or appellate proceeding).
11.05 Indemnity.
(a) General Indemnity. Whether or not the transactions
contemplated hereby are consummated, the Companies shall indemnify,
defend and hold the Agent-Related Persons, and each Bank and each of
its respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, charges, expenses and
disbursements (including Attorney Costs) of any kind or nature
whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement
of the Agent or replacement of any Bank) be imposed on, incurred by or
asserted against any such Person in any way relating to or arising out
of this Agreement or any document contemplated by or referred to
herein, or the transactions contemplated hereby, or any action taken or
omitted by any such Person under or in connection with any of the
foregoing, including with respect to any investigation, litigation or
proceeding (including any Insolvency Proceeding or appellate
proceeding) related to or arising out of this Agreement or the Loans or
the use of the proceeds thereof, whether or not any Indemnified Person
is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided, that the Companies shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting solely from the gross negligence or willful
misconduct of such Indemnified Person. The agreements in this Section
shall survive payment of all other Obligations.
(b) Environmental Indemnity.
(i) The Companies hereby agree to indemnify, defend and hold
harmless each Indemnified Person, from and against any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, charges, expenses or disbursements
(including Attorney Costs and the allocated cost of internal
environmental audit or review services), which may be incurred by
or asserted against such Indemnified Person in connection with or
arising out of any pending or threatened investigation, litigation
or proceeding, or any action taken by any Person, with respect to
any Environmental Claim arising out of or related to any Property
of any of the Companies or any of their respective Subsidiaries.
No action taken by legal counsel chosen by the Agent or any Bank
in defending against any such investigation, litigation or
proceeding or requested remedial, removal or response action shall
vitiate or any way impair the Companies' obligation and duty
hereunder to indemnify and hold harmless the Agent and each Bank.
(ii) In no event shall any site visit, observation, or testing
by the Agent or any Bank be deemed a representation or warranty
that Hazardous Materials are or are not present in, on, or under
the site, or that there has been or shall be compliance with any
Environmental Law. Neither the Companies nor any other Person is
entitled to rely on any site visit, observation, or testing by the
Agent or any Bank. Neither the Agent nor any Bank owes any duty of
care to protect the Companies or any other Person against, or to
inform the Companies or any other party of, any Hazardous
Materials or any other adverse condition affecting any site or
Property. Neither the Agent nor any Bank shall be obligated to
disclose to the Companies or any other Person any report or
findings made as a result of, or in connection with, any site
visit, observation, or testing by the Agent or any Bank.
(c) Survival; Defense. The obligations in this Section 11.05 shall
survive payment of all other Obligations. At the election of any
Indemnified Person, each of the Companies shall defend such Indemnified
Person using legal counsel satisfactory to such Indemnified Person in
such Person's sole discretion, at the sole cost and expense of the
Companies.
(d) Existing Indemnification Rights. All rights of the Agent and
the Banks in respect of any indemnification and otherwise for
reimbursement or payment of any losses, costs, charges, expenses or
disbursements (including Attorney Costs) under or in respect of the
Existing Facility shall survive the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby.
11.06 Payments Set Aside. To the extent that any of the Companies
makes a payment to the Agent or the Banks, or the Agent or the Banks
exercise their right of set-off, and such payment or the proceeds of
such set-off or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside or required (including
pursuant to any settlement entered into by the Agent or such Bank in
its discretion) to be repaid to a trustee, receiver or any other party,
in connection with any Insolvency Proceeding or otherwise, then (a) to
the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such set-off had not
occurred, and (b) each Bank severally agrees to pay to the Agent upon
demand its pro rata share of any amount so recovered from or repaid by
the Agent.
11.07 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that none of the
Companies may assign or transfer any of its rights or obligations under
this Agreement without the prior written consent of the Agent and each
Bank.
11.08 Assignments, Participations, etc. (a) Any Bank may, with the
written consent of the Agent and with the written consent of Xxxxxxxxx
at all times other than during the existence of an Event of Default,
which consent of Xxxxxxxxx, if required, shall not be unreasonably
withheld, at any time assign and delegate to one or more Eligible
Assignees (provided that no written consent of Xxxxxxxxx or the Agent
shall be required in connection with any assignment and delegation by a
Bank to an Eligible Assignee that is an Affiliate of such Bank) (each
an "Assignee") all, or any ratable part of all, of the Loans, the
Commitments and the other rights and obligations of such Bank
hereunder, in a minimum amount of $3,000,000; provided, however, that
the Companies and the Agent may continue to deal solely and directly
with such Bank in connection with the interest so assigned to an
Assignee until (i) written notice of such assignment, together with
payment instructions, addresses and related information with respect to
the Assignee, shall have been given to Xxxxxxxxx and the Agent by such
Bank and the Assignee; (ii) such Bank and its Assignee shall have
delivered to Xxxxxxxxx and the Agent an Assignment and Acceptance in
the form of Exhibit E ("Assignment and Acceptance") together with any
Note or Notes subject to such assignment and (iii) the assignor Bank or
Assignee has paid to the Agent a processing fee in the amount of
$3,500. If the consent of the Agent and of Xxxxxxxxx shall be required
for any such assignment, the Bank proposing to make such assignment
shall give the Agent and Xxxxxxxxx no less than 20 calendar days notice
of such requested consent.
(b) From and after the date that the Agent notifies the assignor
Bank that it has received (and provided its consent with respect to) an
executed Assignment and Acceptance and payment of the above- referenced
processing fee, (i) the Assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have
the rights and obligations of a Bank under the Loan Documents, and (ii)
the assignor Bank shall, to the extent that rights and obligations
hereunder and under the other Loan Documents have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and
be released from its obligations under the Loan Documents.
(c) Within five Business Days after its receipt of notice by the
Agent that it has received an executed Assignment and Acceptance and
payment of the processing fee and requesting new Notes (and provided
that it consents to such assignment in accordance with Section
11.08(a)), the Companies shall execute and deliver to the Agent, new
Notes evidencing such Assignee's assigned Loans and Commitment and, if
the assignor Bank has retained a portion of its Loans and its
Commitment, replacement Notes in the principal amount of the Loans
retained by the assignor Bank (such Notes to be in exchange for, but
not in payment of, the Notes held by such Bank). Immediately upon each
Assignee's making its processing fee payment under the Assignment and
Acceptance, this Agreement shall be deemed to be amended to the extent,
but only to the extent, necessary to reflect the addition of the
Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Bank pro tanto.
(d) Any Bank may, with the written consent of Xxxxxxxxx at all
times other than during the existence of an Event of Default, which
consent of Xxxxxxxxx, if required, shall not be unreasonably withheld,
at any time sell to one or more commercial banks or other Persons not
Affiliates of the Companies (a "Participant") participating interests
in any Loans, the Commitment of that Bank and the other interests of
that Bank (the "originating Bank") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Bank's
obligations under this Agreement shall remain unchanged, (ii) the
originating Bank shall remain solely responsible for the performance of
such obligations, (iii) the Companies and the Agent shall continue to
deal solely and directly with the originating Bank in connection with
the originating Bank's rights and obligations under this Agreement and
the other Loan Documents, and (iv) no Bank shall transfer or grant any
participating interest under which the Participant has rights to
approve any amendment to, or any consent or waiver with respect to,
this Agreement or any other Loan Document, except to the extent such
amendment, consent or waiver would require unanimous consent of the
Banks as pursuant to subsections (a), (b) or (c) of the first proviso
to Section 11.01, in which event such Participant shall (if agreed by
the originating Bank) be entitled to vote with respect to such
amendment, consent or waiver. In the case of any such participation,
the Participant shall be entitled to the benefit of Sections 4.01, 4.03
and 11.05 as though it were also a Bank hereunder, and if amounts
outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall be deemed to have the right of
set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Bank under this Agreement. If
the consent of the Xxxxxxxxx shall be required for any such
participation, the Bank proposing to make such participation shall give
the Agent and Xxxxxxxxx no less than 20 calendar days notice of such
requested consent.
(e) Notwithstanding any other provision in this Agreement, any
Bank may at any time create a security interest in, or pledge, all or
any portion of its rights under and interest in this Agreement and the
Note held by it in favor of any Federal Reserve Bank in accordance with
Regulation A of the FRB or U.S. Treasury Regulation 31 CFR
SECTION203.14, and such Federal Reserve Bank may enforce such pledge or
security interest in any manner permitted under applicable law.
11.09 Confidentiality. Each Bank agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due
care to maintain the confidentiality of all information identified as
"confidential" or "secret" by the Companies and provided to it by any
of the Companies or any of their respective Subsidiaries, or by the
Agent on such Company's or such Subsidiary's behalf, under this
Agreement or any other Loan Document, and neither it nor any of its
Affiliates shall use any such information other than in connection with
or in enforcement of this Agreement and the other Loan Documents or in
connection with other business now or hereafter existing or
contemplated with any of the Companies or any of their respective
Subsidiaries; except to the extent such information (i) was or becomes
generally available to the public other than as a result of disclosure
by the Bank, or (ii) was or becomes available on a nonconfidential
basis from a source other than the Companies, provided that such source
is not bound by a confidentiality agreement with the Companies known to
the Bank; provided, however, that any Bank may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Bank is subject or in connection
with an examination of such Bank by any such authority; (B) pursuant to
subpoena or other court process; (C) when required to do so in
accordance with the provisions of any applicable Requirement of Law;
(D) to the extent reasonably required in connection with any litigation
or proceeding to which the Agent, any Bank or their respective
Affiliates may be party; (E) to the extent reasonably required in
connection with the exercise of any remedy hereunder or under any other
Loan Document; (F) to such Bank's independent auditors and other
professional advisors; (G) to any Participant or Assignee, actual or
potential, provided that such Person agrees in writing to keep such
information confidential to the same extent required of the Banks
hereunder; (H) as to any Bank or its Affiliate, as expressly permitted
under the terms of any other document or agreement regarding
confidentiality to which any of the Companies or any of their
respective Subsidiaries is party to or is deemed party to with such
Bank or such Affiliate; and (I) to its Affiliates.
11.10 Set-off In addition to any rights and remedies of the Banks
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank is authorized at any time and from time to time,
without prior notice to the Companies, any such notice being waived by
the Companies to the fullest extent permitted by law, to set off and
apply any and all deposits (general or special, time or demand,
provisional or final) at any time held by, and other indebtedness at
any time owing by, such Bank to or for the credit or the account of the
Companies against any and all Obligations owing to such Bank, now or
hereafter existing, irrespective of whether or not the Agent or such
Bank shall have made demand under this Agreement or any Loan Document
and although such Obligations may be contingent or unmatured. Each Bank
agrees promptly to notify the Companies and the Agent after any such
set-off and application made by such Bank; provided, however, that the
failure to give such notice shall not affect the validity of such
set-off and application.
11.11 [Intentionally Omitted]
11.12 Notification of Addresses, Lending Offices, etc. Each Bank
shall notify the Agent in writing of any changes in the address to
which notices to the Bank should be directed, of addresses of any
Lending Office, of payment instructions in respect of all payments to
be made to it hereunder and of such other administrative information as
the Agent shall reasonably request.
11.13 Termination of the Facility A Commitment under Existing
Facility. Pursuant to Section 6.3 of the Existing Facility, the
Companies hereby terminate the Facility A Commitment (as that term is
defined in the Existing Facility) as of the Closing Date, and the Banks
that are "Banks" under the Existing Facility hereby waive the prior
notice requirement in Section 6.3 for such termination. The Company
agrees to pay, on the date hereof, all accrued commitment fees under
the Existing Facility to the Closing Date.
11.14 Counterparts. This Agreement may be executed in any number
of separate counterparts, each of which, when so executed, shall be
deemed an original, and all of said counterparts taken together shall
be deemed to constitute but one and the same instrument.
11.15 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Agreement or any
instrument or agreement required hereunder.
11.16 No Third Parties Benefited. This Agreement is made and
entered into for the sole protection and legal benefit of the
Companies, the Banks, the Agent and the Agent-Related Persons, and
their permitted successors and assigns, and no other Person shall be a
direct or indirect legal beneficiary of, or have any direct or indirect
cause of action or claim in connection with, this Agreement or any of
the other Loan Documents.
11.17 Governing Law and Jurisdiction.
(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA;
PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF
CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF
THE COMPANIES, THE AGENT AND THE BANKS CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THOSE
COURTS. EACH OF THE COMPANIES, THE AGENT AND THE BANKS IRREVOCABLY
WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR
BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED
HERETO. THE COMPANIES, THE AGENT AND THE BANKS EACH WAIVE PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
11.18 Waiver of Jury Trial. THE COMPANIES, THE BANKS AND THE AGENT
EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY
TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY
AGENT- RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANIES, THE BANKS
AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL
BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE
FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A
TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.19 Guaranty.
(a) Guaranty. Each of the Companies, in its capacity as a
Guarantor, unconditionally and irrevocably guarantees to the Agent, the
Issuing Bank and the Banks, and their respective successors, endorsees,
transferees and assigns, the full and prompt payment when due (whether
at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise) and performance of the Obligations of each Company
(other than such Guarantor) to the Agent, the Issuing Bank and the
Banks (the "Guaranteed Obligations"). The Guaranteed Obligations do not
include any of the direct obligations or indebtedness of the Guarantor
as a borrower (or an L/C Borrower) under the Credit Agreement to the
Issuing Bank, any of the Banks or the Agent. The Guaranteed Obligations
include interest which, but for an Insolvency Proceeding, would have
accrued on such Guaranteed Obligations, whether or not a claim is
allowed against any Company for such interest in any such Insolvency
Proceeding.
(b) Separate Obligation. Each Guarantor acknowledges and agrees
(i) that the Guaranteed Obligations are separate and distinct from any
indebtedness, obligations or liabilities arising under or in connection
with any other agreement, instrument or guaranty, including under any
provision of this Agreement other than this Section 11.19, executed at
any time by the Guarantor in favor of the Agent, the Issuing Bank or
any of the Banks, and (ii) the Guarantor shall pay and perform all of
the Guaranteed Obligations as required under this Section 11.19, and
the Agent, the Issuing Bank and the Banks may enforce any and all of
their rights and remedies hereunder, without regard to any other
agreement, instrument or guaranty, including any provision of this
Agreement other than this Section 11.19, at any time executed by the
Guarantor in favor of the Agent, the Issuing Bank or any of the Banks,
regardless of whether or not any such other agreement, instrument or
guaranty, or any provision thereof or hereof, shall for any reason
become unenforceable or any of the indebtedness, obligations or
liabilities thereunder shall have been discharged, whether by
performance, avoidance or otherwise. Each Guarantor acknowledges that
in providing benefits to the Companies and the Guarantor, the Agent,
the Issuing Bank and the Banks are relying upon the enforceability of
this Section 11.19 and the Guaranteed Obligations as separate and
distinct indebtedness, obligations and liabilities of the Guarantor,
and each Guarantor agrees that the Agent, the Issuing Bank and the
Banks would be denied the full benefit of their bargain if at any time
this Section 11.19 or the Guaranteed Obligations were treated any
differently. The fact that the guaranty is set forth in this Agreement
rather than in a separate guaranty document is for the convenience of
the Companies and the Guarantors and shall in no way impair or
adversely affect the rights or benefits of the Banks, the L/C Bank or
the Agent under this Section 11.19. Each Guarantor agrees to execute
and deliver a separate agreement, immediately upon request at any time
of the Agent or any Bank, evidencing the Guarantor's obligations under
this Section 11.19. Upon the occurrence of any Event of Default, a
separate action or actions may be brought against the Guarantor,
whether or not any other Company or any other guarantor or Person is
joined therein or a separate action or actions are brought against any
Company or any such other guarantor or Person.
(c) Limitation of Guaranty. To the extent that any court of
competent jurisdiction shall impose by final judgment under applicable
law (including the California Uniform Fraudulent Transfer Act and
Sections 544 and 548 of the Bankruptcy Code) any limitations on
the amount of the Guarantor's liability with respect to the Guaranteed
Obligations which the Agent, the Issuing Bank or the Banks can enforce
under this Section 11.19, the Agent, the Issuing Bank and the Banks by
their acceptance hereof accept such limitation on the amount of the
Guarantor's liability hereunder to the extent needed to make this
Section 11.19 fully enforceable and nonavoidable.
(d) Liability of Guarantor. The liability of the Guarantor under
this Section 11.19 shall be irrevocable, absolute, independent and
unconditional, and shall not be affected by any circumstance which
might constitute a discharge of a surety or guarantor other than the
indefeasible payment and performance in full of all Guaranteed
Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:
(i) each Guarantor's liability hereunder shall be the
immediate, direct, and primary obligation of the Guarantor and
shall not be contingent upon the Agent's, the Issuing Bank's or
any Bank's exercise or enforcement of any remedy it may have
against any of the other Companies or any other Person, or against
any collateral or other security for any Guaranteed Obligations;
(ii) this Guaranty is a guaranty of payment when due and not
merely of collectibility;
(iii) the Agent, the Issuing Bank and the Banks may enforce
this Section 11.19 upon the occurrence of an Event of Default
notwithstanding the existence of any dispute among the Agent, the
Issuing Bank and the Banks and any Company with respect to the
existence of such Event of Default;
(iv) the Guarantor's payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or
abridge the Guarantor's liability for any portion of the
Guaranteed Obligations remaining unsatisfied; and
(v) the Guarantor's liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard
to, and shall not be impaired or affected by, nor shall the
Guarantor be exonerated or discharged by, any of the following
events:
(A) any Insolvency Proceeding;
(B) any limitation, discharge, or cessation of the
liability of the any Company or any other guarantor or Person
for any Guaranteed Obligations due to any statute, regulation
or rule of law, or any invalidity or unenforceability in whole
or in part of any of the Guaranteed Obligations or the Loan
Documents;
(C) any merger, acquisition, consolidation or change in
structure of any Company or any other guarantor or Person, or
any sale, lease, transfer or other disposition of any or all
of the assets or shares of any Company or any other guarantor
or other Person; (D) any assignment or other transfer, in
whole or in part, of the Agent's, the Issuing Bank's or any
Bank's interests in and rights under this Guaranty or the
other Loan Documents;
(E) any claim, defense, counterclaim or setoff, other than
that of prior performance, that any Company, the Guarantor,
any other guarantor or other Person may have or assert,
including any defense of incapacity or lack of corporate or
other authority to execute any of the Loan Documents;
(F) the Agent's, the Issuing Bank's or any Bank's
amendment, modification, renewal, extension, cancellation or
surrender of any Loan Document or any Guaranteed Obligations;
(G) the Agent's, the Issuing Bank's or any Bank's exercise
or nonexercise of any power, right or remedy with respect to
any Guaranteed Obligations or any collateral;
(H) the Agent's, the Issuing Bank's or any Bank's vote,
claim, distribution, election, acceptance, action or inaction
in any Insolvency Proceeding;
(I) any other guaranty, whether by the Guarantor or any
other Person, of all or any part of the Guaranteed Obligations
or any other indebtedness, obligations or liabilities of any
Company to the Agent or the Banks.
(e) Consents of Guarantor. Each Guarantor hereby unconditionally
consents and agrees that, without notice to or further assent from the
Guarantor:
(i) the principal amount of the Guaranteed Obligations may be
increased or decreased and additional indebtedness or obligations
of any Company under the Loan Documents may be incurred and the
time, manner, place or terms of any payment under any Loan
Document may be extended or changed, by one or more amendments,
modifications, renewals or extensions of any Loan Document or
otherwise;
(ii) the time for any Company's (or any other Person's)
performance of or compliance with any term, covenant or agreement
on its part to be performed or observed under any Loan Document
may be extended, or such performance or compliance waived, or
failure in or departure from such performance or compliance
consented to, all in such manner and upon such terms as the Agent,
the Issuing Bank and the Banks may deem proper;
(iii) the Agent, the Issuing Bank and the Banks may request
and accept other guaranties and may take and hold other security
as collateral for the Guaranteed Obligations, and may, from time
to time, in whole or in part, exchange, sell, surrender, release,
subordinate, modify, waive, rescind, compromise or extend such
other guaranties or security and may permit or consent to any such
action or the result of any such action, and may apply such
security and direct the order or manner of sale thereof;
(iv) the Agent, the Issuing Bank and the Banks may exercise,
or waive or otherwise refrain from exercising, any other right,
remedy, power or privilege even if the exercise thereof affects or
eliminates any right of subrogation or any other right of the
Guarantor against any Company;
(f) Guarantor's Waivers. Each Guarantor waives and agrees not to
assert:
(i) any right to require the Agent, the Issuing Bank or any
Bank to proceed against any Company, any other guarantor or any
other Person, or to pursue any other right, remedy, power or
privilege of the Agent, the Issuing Bank or any Bank whatsoever;
(ii) the defense of the statute of limitations in any action
hereunder or for the collection or performance of the Guaranteed
Obligations;
(iii) any defense arising by reason of any lack of corporate
or other authority or any other defense of any Company, the
Guarantor or any other Person;
(iv) any defense based upon the Agent's, the Issuing Bank's or
any Bank's errors or omissions in the administration of the
Guaranteed Obligations;
(v) any rights to set-offs and counterclaims;
(vi) without limiting the generality of the foregoing, to the
fullest extent permitted by law, any defenses or benefits that may
be derived from or afforded by applicable law limiting the
liability of or exonerating guarantors or sureties, or which may
conflict with the terms of this Section 11.19, including any and
all benefits that otherwise might be available to the Guarantor
under California Civil Code SECTIONS 1432, 2809, 2810, 2815,
2819, 2839, 2845, 2848, 2849, 2850, 2899 and 3433 and California
Code of Civil Procedure SECTIONS 580a, 580b, 580d and 726;
and
(vii) any and all notice of the acceptance of this guaranty,
and any and all notice of the creation, renewal, modification,
extension or accrual of the Guaranteed Obligations, or the
reliance by the Agent, the Issuing Bank and the Banks upon this
guaranty, or the exercise of any right, power or privilege
hereunder. The Guaranteed Obligations shall conclusively be deemed
to have been created, contracted, incurred and permitted to exist
in reliance upon this guaranty. Each Guarantor waives promptness,
diligence, presentment, protest, demand for payment, notice of
default, dishonor or nonpayment and all other notices to or upon
any Company, each Guarantor or any other Person with respect to
the Guaranteed Obligations.
(g) Financial Condition of Borrower. No Guarantor shall have any
right to require the Agent, the Issuing Bank or the Banks to obtain or
disclose any information with respect to: the financial condition or
character of any Company or the ability of any Company to pay and
perform the Guaranteed Obligations; the Guaranteed Obligations; any
collateral or other security for any or all of the Guaranteed
Obligations; the existence or nonexistence of any other guarantees of
all or any part of the Guaranteed Obligations; any action or inaction
on the part of the Agent, the Issuing Bank or the Banks or any other
Person; or any other matter, fact or occurrence whatsoever. Each
Guarantor hereby acknowledges that it has undertaken its own
independent investigation of the financial condition of any Company and
all other matters pertaining to this guaranty and further acknowledges
that it is not relying in any manner upon any representation or
statement of the Agent, the Issuing Bank or any Bank with respect
thereto.
(h) Subrogation. Until the Guaranteed Obligations shall be
satisfied in full and the Commitments shall be terminated, the
Guarantor shall not have, and shall not directly or indirectly
exercise, (i) any rights that it may acquire by way of subrogation
under this Section 11.19, by any payment hereunder or otherwise, (ii)
any rights of contribution, indemnification, reimbursement or similar
suretyship claims arising out of this Section 11.19 or (iii) any other
right which it might otherwise have or acquire (in any way whatsoever)
which could entitle it at any time to share or participate in any
right, remedy or security of the Banks, the Issuing Bank or the Agent
as against any Company or other guarantors, whether in connection with
this Section 11.19, any of the other Loan Documents or otherwise. If
any amount shall be paid to the Guarantor on account of the foregoing
rights at any time when all the Guaranteed Obligations shall not have
been paid in full, such amount shall be held in trust for the benefit
of the Agent, the Issuing Bank and the Banks and shall forthwith be
paid to the Agent to be credited and applied to the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms
of the Loan Documents.
(i) Subordination. All payments on account of all indebtedness,
liabilities and other obligations of any of the Companies to the
Guarantor, whether now existing or hereafter arising, and whether due
or to become due, absolute or contingent, liquidated or unliquidated,
determined or undetermined (the "Subordinated Debt") shall be subject,
subordinate and junior in right of payment and exercise of remedies, to
the extent and in the manner set forth herein, to the prior payment in
full in cash or cash equivalents of the Guaranteed Obligations. As long
as any of the Guaranteed Obligations shall remain outstanding and
unpaid, the Guarantor shall not accept or receive any payment or
distribution by or on behalf of any Company, directly or indirectly, or
assets of any Company, of any kind or character, whether in cash,
property or securities, including on account of the purchase,
redemption or other acquisition of Subordinated Debt, as a result of
any collection, sale or other disposition of collateral, or by setoff,
exchange or in any other manner, for or on account of the Subordinated
Debt ("Subordinated Debt Payments"), except that prior to the
occurrence of any Default, the Guarantor shall be entitled to accept
and receive regularly scheduled payments on the Subordinated Debt, in
accordance with past business practices of the Guarantor and the
Companies and not in contravention of the terms of the Loan Documents.
In the event that any Subordinated Debt Payments shall be received in
contravention of this Section, such Subordinated Debt Payments shall be
held in trust for the benefit of the Agent, the Issuing Bank and the
Banks and shall be paid over or delivered to the Agent for application
to the payment in full in cash or cash equivalents of all Guaranteed
Obligations remaining unpaid to the extent necessary to give effect to
this Section after giving effect to any concurrent payments or
distributions to the Agent, the Issuing Bank and the Banks in respect
of the Guaranteed Obligations.
(j) Continuing Guaranty. This Guaranty is a continuing guaranty
and agreement of subordination and shall continue in effect and be
binding upon each Guarantor until termination of the Commitments and
payment and performance in full of the Guaranteed Obligations,
including Guaranteed Obligations which may exist continuously or which
may arise from time to time under successive transactions, and each
Guarantor expressly acknowledges that this Guaranty shall remain in
full force and effect notwithstanding that there may be periods in
which no Guaranteed Obligations exist. This Guaranty shall continue in
effect and be binding upon each Guarantor until actual receipt by the
Agent of written notice from such Guarantor of its intention to
discontinue this Guaranty as to future transactions (which notice shall
not be effective until noon on the day five Business Days following
such receipt); provided that no revocation or termination of this
Guaranty shall affect in any way any rights of the Agent, the Issuing
Bank and the Banks hereunder with respect to any Guaranteed Obligations
arising or outstanding on the date of receipt of such notice, including
any subsequent continuation, extension, or renewal thereof, or change
in the terms or conditions thereof, or any Guaranteed Obligations made
or created after such date to the extent made or created pursuant to a
legally binding commitment of any of the Issuing Bank or the Banks in
existence as of the date of such revocation (collectively, "Existing
Guaranteed Obligations"), and the sole effect of such notice shall be
to exclude from this Guaranty Guaranteed Obligations thereafter arising
which are unconnected to any Existing Guaranteed Obligations.
(k) Reinstatement. This Guaranty shall continue to be effective or
shall be reinstated and revived, as the case may be, if, for any
reason, any payment of the Guaranteed Obligations by or on behalf of
any Company (or receipt of any proceeds of collateral) shall be
rescinded, invalidated, declared to be fraudulent or preferential, set
aside, voided or otherwise required to be repaid to any Company, its
estate, trustee, receiver or any other Person (including under the
Bankruptcy Code or other state or federal law), or must otherwise be
restored by the Agent, the Issuing Bank or any Bank, whether as a
result of Insolvency Proceedings or otherwise. All losses, damages,
costs and expenses that the Agent, the Issuing Bank or the Banks may
suffer or incur as a result of any voided or otherwise set aside
payments shall be specifically covered by the indemnity in favor of the
Banks, the Issuing Bank and the Agent contained in Section 11.05.
(l) Substantial Benefits. The funds that have been borrowed from
the Banks by the Companies, and the Issuance of any Letter of Credit by
the Issuing Bank, have been and are to be contemporaneously used for
the benefit of the Companies and the Guarantor. It is the position,
intent and expectation of the parties that the Companies and the
Guarantor have derived and will derive significant and substantial
benefits from the accommodations that have been made by the Banks and
the Issuing Bank under the Loan Documents. The Guarantor has received
at least "reasonably equivalent value" (as such phrase is used in
Section 548 of the Bankruptcy Code, in Section 3439.04 of the California
Uniform Fraudulent Transfer Act and in comparable provisions of other
applicable law) and more than sufficient consideration to support its
obligations hereunder in respect of the Guaranteed Obligations and
under any of the Loan Documents to which it is a party. Immediately
prior to and after and giving effect to the incurrence of the
Guarantor's obligations under this Guaranty the Guarantor will be
solvent.
(m) Knowing and Explicit Waivers. EACH GUARANTOR ACKNOWLEDGES THAT
IT EITHER HAS OBTAINED THE ADVICE OF LEGAL COUNSEL OR HAS HAD THE
OPPORTUNITY TO OBTAIN SUCH ADVICE IN CONNECTION WITH THE TERMS AND
PROVISIONS OF THIS SECTION 11.19. EACH GUARANTOR ACKNOWLEDGES AND
AGREES THAT EACH OF THE WAIVERS AND CONSENTS SET FORTH HEREIN, ARE MADE
WITH FULL KNOWLEDGE OF THEIR SIGNIFICANCE AND CONSEQUENCES, AND THAT
ALL SUCH WAIVERS AND CONSENTS HEREIN ARE EXPLICIT AND KNOWING WHICH
EACH GUARANTOR EXPECTS TO BE FULLY ENFORCEABLE.
If, while any Subordinated Debt is outstanding, any Insolvency
Proceeding is commenced by or against any Company or its property, the
Agent, when so instructed by the Issuing Bank and the Majority Banks,
is hereby irrevocably authorized and empowered (in the name of the
Issuing Bank and the Banks or in the name of the Guarantor or
otherwise), but shall have no obligation, to demand, xxx for, collect
and receive every payment or distribution in respect of the
Subordinated Debt and give acquittance therefor and to file claims and
proofs of claim and take such other action (including voting the
Subordinated Debt) as it may deem necessary or advisable for the
exercise or enforcement of any of the rights or interests of the Agent
the Issuing Bank and the Banks; and each Guarantor shall promptly take
such action as the Agent (on instruction from the Issuing Bank and the
Majority Banks) may reasonably request (A) to collect the Subordinated
Debt for the account of the Issuing Bank and the Banks and to file
appropriate claims or proofs of claim in respect of the Subordinated
Debt, (B) to execute and deliver to the Agent, such powers of attorney,
assignments and other instruments as it may request to enable it to
enforce any and all claims with respect to the Subordinated Debt, and
(C) to collect and receive any and all Subordinated Debt Payments.
11.20 Entire Agreement. This Agreement, together with the other
Loan Documents, embodies the entire agreement and understanding among
the Companies, the Banks and the Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal
or written, relating to the subject matter hereof and thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered in San Francisco, California by their
proper and duly authorized officers as of the day and year first above
written.
XXXXXXXXX TECHNOLOGIES CORPORATION KORRY ELECTRONICS CO.
By /s/ X. X. Xxxxxxxxx By /s/ X. X. Xxxxxxxxx
-------------------------------- ------------------------------
Title E.V. P. & C.F.O. Title V. P.
--------------------------- ---------------------------
ARMTEC DEFENSE PRODUCTS CO. MIDCON CABLES CO.
By /s/ X. X. Xxxxxxxxx
-------------------------------- By /s/ X. X. Xxxxxxxxx
Title V. P. ------------------------------
--------------------------- Title V. P.
---------------------------
EQUIPMENT SALES CO. TA MFG. CO.
By /s/ X. X. Xxxxxxxxx By /s/ X. X. Xxxxxxxxx
------------------------------ -----------------------------
Title V. P. Title V. P.
--------------------------- --------------------------
ANGUS ELECTRONICS CO. TULON CO.
By /s/ X. X. Xxxxxxxxx By /s/ X. X. Xxxxxxxxx
------------------------------ -----------------------------
Title V. P. Title V. P.
--------------------------- --------------------------
EXCELLON AUTOMATION CO. W.A. WHITNEY CO.
By /s/ X. X. Xxxxxxxxx By /s/ X. X. Xxxxxxxxx
------------------------------ -----------------------------
Title V. P. Title V. P.
--------------------------- --------------------------
FEDERAL PRODUCTS CO. XXXXX ELECTRIC CO.
By /s/ X. X. Xxxxxxxxx By /s/ X. X. Xxxxxxxxx
------------------------------ -----------------------------
Title V. P. Title V. P.
--------------------------- --------------------------
HYTEK FINISHES CO.
By /s/ X. X. Xxxxxxxxx
------------------------------
Title V. P.
---------------------------
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent
By /s/ Xxxxx Xxxxxxx-Xxxxxxx
------------------------------
Title Vice President
---------------------------
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Issuing Bank
By /s/ Xxxxx Xxxxxxx-Xxxxxxx
------------------------------
Title Vice President
---------------------------
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as a Bank
By /s/ Xxxxx Xxxxxxx-Xxxxxxx
------------------------------
Title Vice President
---------------------------
THE BANK OF TOKYO-MITSUBISHI, LTD., SEATTLE BRANCH
By /s/ Xxxxx Xxxxxxx
------------------------------
Title Vice President
---------------------------
BANK OF AMERICA NW, N.A., DBA SEAFIRST BANK
By /s/ Xxxx X. Xxxxxxx
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Title Senior Vice President
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U.S. BANK OF WASHINGTON, N.A.
By /s/ Xxxxx Xxxxxxx
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Title Senior Vice President
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XXXXX FARGO BANK, N.A.
By /s/ Xxxxxx X. Xxxxxxx
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Title Vice President
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