EXHIBIT 10.18.2
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SECOND RESTATED CREDIT AGREEMENT
among
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ BUILDING PRODUCTS, INC.
and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ CANADA, INC.
and
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION,
as Agent,
ABN AMRO BANK, N.V.,
as Co-Agent,
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION,
as Issuing Bank,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Canadian Agent,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Canadian Issuing Bank
and each
LENDER
January 29, 1997
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TABLE OF CONTENTS
ARTICLE I. DEFINITIONS
1.01. DEFINITIONS.................................................... 1
1.02. ACCOUNTING AND OTHER TERMS.................................... 27
1.03. COVENANT CALCULATIONS......................................... 27
ARTICLE II. AMOUNTS AND TERMS OF ADVANCES
2.01. THE ADVANCES.................................................. 27
2.02. MAKING ADVANCES............................................... 28
2.03. EVIDENCE OF INDEBTEDNESS...................................... 30
2.04. PREPAYMENTS................................................... 30
2.05. REPAYMENT..................................................... 32
2.06. INTEREST...................................................... 32
2.07. DEFAULT INTEREST.............................................. 33
2.08. CONTINUATION AND CONVERSION ELECTIONS FOR DOMESTIC ADVANCES... 33
2.09. FEES.......................................................... 34
2.10. REDUCTION OF COMMITMENT....................................... 35
2.11. FUNDING LOSSES................................................ 36
2.12. COMPUTATIONS AND MANNER OF PAYMENTS........................... 37
2.13. YIELD PROTECTION; CHANGED CIRCUMSTANCES....................... 38
2.14. USE OF PROCEEDS............................................... 40
2.15. LETTERS OF CREDIT............................................. 41
2.16. CANADIAN LETTERS OF CREDIT.................................... 46
2.17. REALLOCATION.................................................. 51
2.18. PROVISIONS RESPECTING CANADIAN ADVANCES....................... 52
ARTICLE III. CONDITIONS PRECEDENT
3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS......................... 56
3.02. CONDITIONS PRECEDENT TO ALL ADVANCES, LETTERS OF CREDIT AND
CANADIAN LETTERS OF CREDIT.................................... 58
3.03. CONDITIONS PRECEDENT TO CERTAIN ADVANCES, LETTERS OF CREDIT
AND CANADIAN LETTERS OF CREDIT................................ 59
ARTICLE IV. REPRESENTATIONS AND WARRANTIES
4.01. ORGANIZATION AND QUALIFICATION................................ 60
4.02. DUE AUTHORIZATION; VALIDITY................................... 61
4.03. CONFLICTING AGREEMENTS AND OTHER MATTERS...................... 61
4.04. FINANCIAL STATEMENTS; FISCAL YEAR............................. 61
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4.05. LITIGATION.................................................... 61
4.06. COMPLIANCE WITH LAWS REGULATING THE INCURRENCE OF DEBT........ 62
4.07. LICENSES, TITLE TO PROPERTIES, AND RELATED MATTERS............ 62
4.08. OUTSTANDING DEBT; EXISTING LIENS.............................. 62
4.09. TAXES......................................................... 62
4.10. ERISA......................................................... 63
4.11. ENVIRONMENTAL LAWS............................................ 63
4.12. INVESTMENTS; SUBSIDIARIES..................................... 63
4.13. CERTAIN FEES.................................................. 64
4.14. CABP.......................................................... 64
4.15. DISCLOSURE.................................................... 64
4.16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES, DISCLAIMERS,
WAIVERS, ETC.................................................. 64
ARTICLE V. NEGATIVE COVENANTS
5.01. CURRENT RATIO................................................. 65
5.02. TANGIBLE NET WORTH............................................ 65
5.03. FUNDED DEBT TO EBITDA RATIO................................... 65
5.04. FIXED CHARGES COVERAGE RATIO.................................. 65
5.05. RESTRICTED PAYMENT............................................ 65
5.06. CAPITAL EXPENDITURES.......................................... 65
5.07. DEBT.......................................................... 65
5.08. DISPOSITIONS OF ASSETS........................................ 66
5.09. MERGER; CONSOLIDATION; INVESTMENTS............................ 66
5.10. LIENS......................................................... 67
5.11. FISCAL YEAR AND ACCOUNTING METHOD............................. 67
5.12. ISSUANCE OF CAPITAL STOCK; AMENDMENT OF CHARTER............... 67
5.13. CHANGE OF OWNERSHIP........................................... 68
5.14. SALE AND LEASEBACK............................................ 68
5.15. BUSINESS...................................................... 68
5.16. TRANSACTIONS WITH AFFILIATES.................................. 68
5.17. COMPLIANCE WITH ERISA......................................... 68
5.18. NOTE PURCHASE AGREEMENT....................................... 69
5.19. SWAP EXPOSURE................................................. 69
5.20. CAFS.......................................................... 69
5.21. SUBSIDIARIES AND OBLIGORS..................................... 70
5.22. INTERCOMPANY ADVANCES......................................... 70
5.23. CAFS.......................................................... 70
ARTICLE VI. AFFIRMATIVE COVENANTS
6.01. PRESERVATION OF EXISTENCE AND SIMILAR MATTERS................. 70
6.02. LICENSES AND MATERIAL AGREEMENTS.............................. 71
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6.03. COMPLIANCE WITH LAWS.......................................... 71
6.04. MAINTENANCE OF PROPERTIES..................................... 71
6.05. PAYMENT OF TAXES AND OTHER INDEBTEDNESS....................... 71
6.06. ERISA COMPLIANCE.............................................. 71
6.07. INSURANCE..................................................... 71
6.08. INSPECTION RIGHTS............................................. 73
6.09. RECORDS AND BOOKS OF ACCOUNT; CHANGES IN GAAP................. 73
6.10. REPORTING REQUIREMENTS........................................ 74
6.11. SOLVENCY...................................................... 76
6.12. SUBSIDIARIES AND OBLIGOR...................................... 76
6.13. FURTHER ASSURANCES............................................ 77
ARTICLE VII. EVENTS OF DEFAULT
7.01. EVENTS OF DEFAULT............................................. 77
7.02. REMEDIES UPON DEFAULT......................................... 79
7.03. CUMULATIVE RIGHTS............................................. 80
7.04. WAIVERS....................................................... 80
7.05. PERFORMANCE BY AGENT OR ANY LENDER............................ 80
7.06. EXPENDITURES.................................................. 80
7.07. CONTROL....................................................... 80
7.08. CAFS.......................................................... 81
ARTICLE VIII. THE AGENT AND CANADIAN AGENT
8.01. AUTHORIZATION AND ACTION...................................... 81
8.02. AGENT'S RELIANCE, ETC......................................... 81
8.03. NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, CANADIAN
IMPERIAL BANK OF COMMERCE AND AFFILIATES...................... 82
8.04. LENDER CREDIT DECISION........................................ 82
8.05. INDEMNIFICATION BY LENDERS.................................... 82
8.06. SUCCESSOR AGENT............................................... 83
8.07 SUCCESSOR CANADIAN AGENT...................................... 83
ARTICLE IX. MISCELLANEOUS
9.01. AMENDMENTS AND WAIVERS........................................ 84
9.02. NOTICES....................................................... 84
9.03. PARTIES IN INTEREST........................................... 87
9.04. ASSIGNMENTS AND PARTICIPATIONS................................ 87
9.05. SHARING OF PAYMENTS........................................... 88
9.06. RIGHT OF SET-OFF.............................................. 88
9.07. COSTS, EXPENSES, AND TAXES.................................... 89
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9.08. INDEMNIFICATION BY BORROWERS.................................. 89
9.09. RATE PROVISION................................................ 90
9.10. SEVERABILITY.................................................. 90
9.11. EXCEPTIONS TO COVENANTS....................................... 91
9.12. COUNTERPARTS.................................................. 91
9.13. GOVERNING LAW; WAIVER OF JURY TRIAL........................... 91
9.15. RESTATEMENT................................................... 92
9.16. ENTIRE AGREEMENT.............................................. 92
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SCHEDULES AND EXHIBITS:
Schedule 1.01 - Specified Percentages
Schedule 3.01(f) - Guarantors
Schedule 4.01-a - Jurisdictions of Qualification, Ownership and
Capital Structure - Parent
Schedule 4.01-b - Jurisdictions of Qualification, Ownership and
Capital Structure - Subsidiaries
Schedule 4.01-c - Jurisdictions of Qualification, Ownership and
Capital Structure - CA Canada
Schedule 4.05 - Existing Litigation
Schedule 4.08-a - Existing Debt and Liabilities
Schedule 4.08-b - Existing Liens
Schedule 4.09 - Taxes
Schedule 4.12 - Existing Investments
Schedule 9.02 - Lender Addresses
Exhibit A - Note (Domestic Advance)
Exhibit B - Guaranty
Exhibit C - Compliance Certificate
Exhibit D - Borrowing Notice
Exhibit E - Conversion or Continuation Notice
Exhibit F - Borrowing Base Certificate
Exhibit G - Opinions of Parent's and Obligors' Counsel
Exhibit H - Instruction Letter
Exhibit I - Solvency Certificates
Exhibit J - Assignment and Acceptance Agreement
Exhibit K - Note (Canadian Advance)
Exhibit L - Reallocation Notice
Exhibit M - Separateness Agreement
Exhibit N - Parent Guaranty
SECOND RESTATED CREDIT AGREEMENT
THIS SECOND RESTATED CREDIT AGREEMENT is dated as of January 29, 1997,
among ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Building Products, Inc., a Georgia corporation ("PARENT"),
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Canada, Inc., a Canadian corporation ("CA CANADA"), the Lenders
from time to time party hereto or to an Assignment and Acceptance, NationsBank
of Texas, National Association, as Issuing Bank and Agent, ABN AMRO Bank, N.V.,
as Co-Agent, and Canadian Imperial Bank of Commerce, as Canadian Issuing Bank
and Canadian Agent.
BACKGROUND.
Parent entered into the First Amended Credit Agreement dated as of April
18, 1996, with NationsBank of Texas, National Association, as Issuing Bank and
Agent, and ABN AMRO Bank, N.V., as Co-Agent (as amended from time to time, the
"EXISTING AGREEMENT"). Parent has requested that the Existing Agreement be
amended to provide a line of credit in the maximum aggregate amount of
$80,000,000 and a letter of credit subfacility (being a portion of the line of
credit) in the maximum aggregate amount of $5,000,000 from Lenders and Issuing
Bank, and Lenders and Issuing Bank have agreed to make such loans and issue
letters of credit, respectively, pursuant to the terms and conditions of this
Agreement.
CA Canada has requested a line of credit in the maximum aggregate amount of
CDN$25,000,000 and a letter of credit subfacility (being a portion of the line
of credit) in the maximum aggregate amount of CDN$2,000,000 from Canadian
Lenders and Canadian Issuing Bank, and Canadian Lenders and Canadian Issuing
Bank have agreed to make such loans and issue letters of credit, respectively,
pursuant to the terms and conditions of this Agreement.
AGREEMENT.
NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties
hereto agree as follows:
ARTICLE I. DEFINITIONS
1.01. DEFINITIONS. As used in this Agreement, the following terms have
the respective meanings indicated below (such meanings to be applicable equally
to both the singular and plural forms of such terms):
"ABN" has the meaning set forth in SECTION 2.17(a).
"ACCEPTABLE BANK" means any bank or trust company (a) which is organized
under the laws of the United States of America or any State thereof or the laws
of Canada or any Province thereof, (b) which has capital, surplus and undivided
profits aggregating at least $100,000,000 or the Canadian Dollar equivalent
thereof, and (c) whose long-term unsecured debt obligations (or the long-term
unsecured debt obligations of the bank holding company owning all of the capital
stock of such bank or trust company) shall have been given a rating of "AA" or
better by S&P or "Aa" or better by ▇▇▇▇▇'▇.
"ACCEPTABLE BROKER-DEALER" means any Person other than a natural person (a)
which is registered as a broker or dealer pursuant to the Securities Exchange
Act of 1934, as amended, and (b) whose long-term unsecured debt obligations
shall have been given a rating of "AA" or better by S&P or "Aa" or better by
▇▇▇▇▇'▇.
"ACCOUNTS" means, with respect to any Person, all present and future
rights, howsoever evidenced, of such Person to payment for goods sold or leased
or for services rendered, and whether or not they have been earned by
performance, including, without limitation, all "accounts" as such term is
defined under Applicable Law.
"ADDITIONAL LETTER OF CREDIT COSTS" has the meaning specified in SECTION
2.15(d).
"ADDITIONAL CANADIAN LETTER OF CREDIT COSTS" has the meaning specified in
SECTION 2.16(d).
"ADVANCE" means a Domestic Advance or a Canadian Advance.
"AFFILIATE" means a Person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled By or is Under Common Control with
another Person.
"AGENT" means NationsBank of Texas, National Association, in its capacity
as Agent hereunder, or any successor Agent appointed pursuant to SECTION 8.06.
"AGREEMENT" means this Second Restated Credit Agreement, together with all
amendments and restatements in accordance with its terms.
"APPLICABLE LAW" means (a) in respect of any Person, all provisions of Laws
of Tribunals applicable to such Person, and all orders and decrees of all courts
and arbitrators in proceedings or actions to which the Person in question is a
party; (b) in respect of contracts made or performed in the State of Texas,
"Applicable Law" also means the laws of the United States of America, including,
without limiting the foregoing, 12 USC Sections 85 and 86, as amended to the
date hereof and as the same may be amended at any time and from time to time
hereafter, and any other statute of the United States of America now or at any
time hereafter prescribing the maximum rates of interest on loans and extensions
of credit, and the laws of the State of Texas, including, without limitations,
the U.C.C. and Articles 5069-1.04 and 5069-1.07(a), Title 79, Revised Civil
Statutes of Texas, 1925, as amended ("ART. 1.04"), and any other statute of the
State of Texas now or at any time hereafter prescribing maximum rates of
interest on loans and extensions of credit; PROVIDED HOWEVER, that pursuant to
Article 5069-15.10(b), Title 79, Revised Civil Statutes of Texas, 1925, as
amended, Parent agrees that the provisions of Chapter 15, Title 79, Revised
Civil Statutes of Texas, 1925, as amended, shall not apply to the Advances
hereunder; and (c) in respect
2
of contracts relating to the Canadian Commitment, means the laws of the
province of Alberta and the laws of Canada applicable therein.
"APPLICABLE MARGIN" means for the four most recently completed fiscal
quarters immediately preceding the Effective Date and as tested at the end of
each successive fiscal quarter for the then four most recently completed fiscal
quarters, effective on the first Business Day following receipt by Agent from
Parent of a Compliance Certificate delivered to Agent for such fiscal quarter
demonstrating a change in the Funded Debt to EBITDA Ratio to an amount so that
another Applicable Margin should be applied pursuant to the table set forth
below, the Applicable Margin for each LIBOR Advance and for each Banker's
Acceptance made on such day or thereafter shall thereafter mean the respective
percentage calculated on a per annum basis set forth in Column A below opposite
such relevant Funded Debt to EBITDA Ratio, and the Applicable Margin for the
Commitment Fee shall mean the percentage calculated on a per annum basis in
Column B below opposite such relevant Funded Debt to EBITDA Ratio, until such
time as the Applicable Margin shall be redetermined as provided above; PROVIDED
that the Applicable Margin shall never be a negative number.
Column A Column B
Funded Debt To EBITDA Ratio LIBOR and Commitment Fee
--------------------------- Bankers --------------
Acceptances Rate
----------------
Greater than or equal to 3.00 to 1 1.000% 0.30%
Greater than or equal to 2.00 to
1 but less than 3.00 to 1 0.750% 0.25%
Greater than or equal to 1.00 to
1 but less than 2.00 to 1 0.625% 0.20%
Less than 1.00 to 1 0.500% 0.20%
"ART. 1.04" has the meaning specified in the definition of "Applicable
Law".
"ASHLEY" means Ashley Aluminum, Inc., a Georgia corporation.
"ASHLEY MANAGEMENT AGREEMENT" means the Agreement for Consulting Services
dated as of October 18, 1991 (as amended through the Effective Date) between
Ashley and CGW.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance entered into
by a Lender and an Eligible Assignee, and accepted by Agent or Canadian Agent,
as the case may be, in the form of EXHIBIT J.
"ATTRIBUTABLE DEBT" means, as to any particular lease relating to a
Sale-and-Leaseback, the present value of all Lease Rentals required to be paid
by Parent or any Subsidiary of Parent under
3
such lease during the remaining term thereof, including any period for which
such lease has been extended (such present value to be determined in
accordance with generally accepted financial practice, compounded
semiannually using a discount factor equal to the implicit rate of such
lease, if known, of, if not, the current LIBOR Rate).
"AUDITOR" means Deloitte & Touche, or other independent certified public
accountants selected by Parent and acceptable to Agent.
"BANKERS' ACCEPTANCE" means a draft in Canadian Dollars drawn by CA Canada
and accepted by the Canadian Agent and issued under this Agreement.
"BANKERS' ACCEPTANCE RATE" means the rate per annum established from time
to time by the Canadian Agent as its base rate for the acceptance of Bankers'
Acceptances.
"BASE ADVANCE" means an Advance bearing interest at the Base Rate.
"BASE RATE" means a fluctuating rate per annum as shall be in effect from
time to time announced or published by NationsBank of Texas, National
Association as its prime rate, and which may not necessarily be the lowest
interest rate charged by NationsBank of Texas, National Association.
"BORROWERS" means Parent and CA Canada.
"BORROWING" means a borrowing of the same Type made on the same day.
"BORROWING BASE" means, as of any given date, an amount equal to the sum of
(a) 85% of the aggregate amount of Eligible Accounts of each of Parent, Ashley,
Cameron and CA Canada plus (b) 50% of the value of Eligible Inventory of each of
Parent, Ashley, Cameron and CA Canada; PROVIDED, in determining the "Borrowing
Base", at no time shall the amount specified in CLAUSE (b) exceed the amount
specified in CLAUSE (a).
"BORROWING BASE CERTIFICATE" means a written report in the form of EXHIBIT
F, delivered by Parent to Agent and each Lender and certified as true and
correct by an authorized officer of Parent, Ashley, Cameron and CA Canada. For
purposes of preparing the Borrowing Base Certificate, to the extent that any of
the Eligible Accounts or Eligible Inventory are valued in Canadian Dollars,
Parent, Ashley, Cameron, and CA Canada shall determine the value of Eligible
Accounts and Eligible Inventory by using the Equivalent Amount thereof.
"BORROWING NOTICE" has the meaning set forth in SECTION 2.02(a).
"BUSINESS DAY" means (a) with respect to any Domestic Advance, a day of the
year on which banks are not required or authorized to close in Dallas, Texas or,
if with respect to any notice, payment or calculation related to a LIBOR
Advance, London, England, or (b) with respect
4
to any Canadian Advance, a day of the year on which banks are not required or
authorized to close in ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇.
"CABP" means CABP, Inc., an Arizona corporation.
"CA CANADA" has the meaning set forth in the introductory paragraph.
"CAFS" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Financial Services, Inc., a Texas corporation.
"CAFS CREDIT AGREEMENT" means the Credit Agreement dated as of December 3,
1996, between CAFS and Bank One, Texas, N.A., as from time to time amended or
restated.
"CAFS GUARANTY" means the Guaranty dated as of December 3, 1996, made by
Parent in favor of Bank One, Texas, N.A.
"CAFS LIABILITY" means all obligations and liabilities, whether now or
hereafter existing or acquired, and contingent or matured, including but not
limited to all Debt and Contingent Liabilities, and all other liabilities, of
(a) CAFS, and (b) Parent related to all obligations and liabilities described in
CLAUSE (A), including but not limited to all agreements to acquire any debt,
equity or asset of CAFS, guarantee any obligation of CAFS, and maintain the
liquidity or net worth of CAFS, all liabilities resulting from substantive
consolidation, membership in any corporate group or similar equitable remedy,
claims with respect to the breach of any agreement, all damages and penalties,
and any indemnity of any Person.
"CDOR SCREEN RATE" means the average bid rate for bankers' acceptances
(expressed to five decimal places) quoted on the ▇▇▇▇▇▇'▇ Canadian discount
offer rate screen at 10:00 a.m., Toronto time, on the applicable date for
bankers' acceptances having a term to maturity of one month.
"CGW" means CGW Southeast Management Company, a Georgia corporation.
"CAMERON" means Wm. Cameron & Co., a Georgia corporation.
"CAMERON MANAGEMENT AGREEMENT" means the Agreement for Consulting Services
dated as of December 20, 1991 (as amended through April 18, 1996), between
Cameron and CGW.
"CANADIAN ADVANCE" means an advance made by a Lender to CA Canada pursuant
to SECTION 2.01(b).
"CANADIAN AGENT" means Canadian Imperial Bank of Commerce, in its capacity
as Canadian Agent hereunder, or any successor Canadian Agent appointed pursuant
to SECTION 8.06.
5
"CANADIAN COMMITMENT" means CDN $25,000,000, as reduced from time to time
pursuant to SECTION 2.10 or 7.02, or as increased from time to time pursuant to
SECTION 2.17.
"CANADIAN DOLLARS" and "CDN$" mean the lawful currency of Canada.
"CANADIAN DOLLAR EXCHANGE EQUIVALENT" means, with reference to an amount
expressed in a currency other than Canadian dollars, the amount expressed in
Canadian Dollars which the Canadian Agent would be required to pay in Calgary at
the opening of business on the date specified, in order to purchase the original
amount, in accordance with the Canadian Agent's usual foreign exchange practice.
"CANADIAN ISSUING BANK" means Canadian Imperial Bank of Commerce, in its
capacity as issuer of a Canadian Letter of Credit in accordance with SECTION
2.16 herein.
"CANADIAN L/C CASH COLLATERAL ACCOUNT" has the meaning specified in
SECTION 2.16(f).
"CANADIAN L/C RELATED DOCUMENTS" has the meaning specified in
SECTION 2.16(e).
"CANADIAN LENDER" means the Canadian lenders listed on the signature pages
of this Agreement, and each Eligible Assignee which hereafter becomes a party to
this Agreement pursuant to SECTION 9.04 as a Canadian Lender.
"CANADIAN LETTER OF CREDIT" has the meaning specified in SECTION 2.16(a).
"CANADIAN LETTER OF CREDIT AGREEMENT" has the meaning specified in
SECTION 2.16(b).
"CANADIAN LETTER OF CREDIT FACILITY" has the meaning specified in
SECTION 2.16(a).
"CANADIAN PRIME RATE" means on any day and with respect to all Canadian
Advances, the variable rate of interest expressed as a percentage per annum
(calculated on the basis of a year of 365 days) which the Canadian Imperial Bank
of Commerce quotes from time to time as the reference rate of interest it will
charge for demand loans in Canadian Dollars to its customers in Canada and which
it designates as its prime rate. If on the date an outstanding advance under
the Canadian Commitment is converted to a Canadian Advance bearing interest at
the Canadian Prime Rate, the Canadian Prime Rate is less than the Floor Rate on
that date, then the interest rate applicable to such Advance shall be the Floor
Rate until such time as the Canadian Prime Rate is no longer less than the Floor
Rate, whereupon the interest rate applicable to such Canadian Advance bearing
interest at the Canadian Prime Rate will be the Canadian Prime Rate. The
Canadian Prime Rate is not necessarily intended to be the lowest rate of
interest determined by the Canadian Imperial Bank of Commerce in connection with
extensions of credit in Canadian Dollars. Changes in the rate of interest on
that portion of any Loans maintained as Canadian Advances will take effect
simultaneously with each change in the Canadian Prime Rate. Canadian Agent may
give notice to Borrowers and each Canadian Lender of the Canadian Prime Rate
from time to time
6
quoted by the Canadian Imperial Bank of Commerce and such notice shall be
conclusive and binding for all purposes absent error.
"CANADIAN PRIME RATE ADVANCE" means a Canadian Advance bearing interest at
the Canadian Prime Rate.
"CAPITAL EXPENDITURES" means capital expenditures, as defined in accordance
with GAAP.
"CAPITAL LEASES" means capital leases and subleases, as defined in
accordance with GAAP.
"CO-AGENT" means ABN AMRO Bank, N.V.
"COMMITMENT" means the Domestic Commitment and the Canadian Commitment.
"COMMITMENT FEE" means the fee described in SECTION 2.09(a).
"COMPLIANCE CERTIFICATE" means a certificate of an officer of Parent
acceptable to Agent, in the form of EXHIBIT C, (a) certifying that such
individual has no knowledge that a Default or Event of Default has occurred and
is continuing, or if a Default or Event of Default has occurred and is
continuing, a statement as to the nature thereof and the action being taken or
proposed to be taken with respect thereto, (b) setting forth detailed
calculations with respect to the covenants described in SECTIONS 5.01 through
5.07 and 5.14 and (c) setting forth detailed calculations of the Applicable
Margin.
"CONSEQUENTIAL LOSS," with respect to (a) Parent's or CA Canada's payment
of all or any portion of the then-outstanding principal amount of a LIBOR
Advance or a Bankers' Acceptance on a day other than the last day of the related
Interest Period, including, without limitation, payments made as a result of the
acceleration of the maturity of a Note, (b) subject to Agent's prior consent, a
LIBOR Advance or a Bankers' Acceptance made on a date other than the date on
which the Advance is to be made according to SECTION 2.02(a) or 2.08, or (c) any
of the circumstances specified in SECTION 2.04 on which a Consequential Loss may
be incurred, means any loss, cost or expense incurred by any Lender as a result
of the timing of the payment or Advance or in liquidating, redepositing,
redeploying or reinvesting the principal amount so paid or affected by the
timing of the Advance or the circumstances described in SECTION 2.04, which
amount shall be the sum of (i) the interest that, but for the payment or timing
of Advance, such Lender would have earned in respect of that principal amount,
reduced, if such Lender is able to redeposit, redeploy, or reinvest the
principal amount, by the interest earned by such Lender as a result of
redepositing, redeploying or reinvesting the principal amount plus (ii) any
expense or penalty incurred by such Lender by reason of liquidating,
redepositing, redeploying or reinvesting the principal amount. Each
determination by each Lender of any Consequential Loss is, in the absence of
manifest error, conclusive and binding.
7
"CONSOLIDATED ASSETS" means, as of any date of determination, the total
amount of all assets of Parent and its Subsidiaries on a consolidated basis in
accordance with GAAP.
"CONTINGENT LIABILITY" means, as to any Person, any obligation, contingent
or otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Debt or obligation of any other Person in any manner, whether
directly or indirectly, including without limitation any obligation of such
Person, direct or indirect, (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Debt or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such Debt,
(b) to purchase Property or services for the purpose of assuring the owner of
such Debt of its payment, or (c) to maintain the solvency, working capital,
equity, cash flow, fixed charge or other coverage ratio, or any other financial
condition of the primary obligor so as to enable the primary obligor to pay any
Debt or to comply with any agreement relating to any Debt or obligation.
"CONTINUE," "CONTINUATION" and "CONTINUED" each refer to the continuation
pursuant to SECTION 2.08 of a LIBOR Advance from one Interest Period to the next
Interest Period.
"CONTROL" or "CONTROLLED BY" or "UNDER COMMON CONTROL" mean possession,
direct or indirect, of power to direct or cause the direction of management or
policies (whether through ownership of voting securities, by contract or
otherwise); PROVIDED that, in any event (a) any Person which beneficially owns
(i) 10% or more (in number of votes) of the securities having ordinary voting
power for the election of directors of a corporation shall be conclusively
presumed to control such corporation and (ii) 10% or more of the interest in
capital or profits of a partnership shall be conclusively presumed to control
such partnership, and (b) no Person shall be deemed to be an Affiliate of a
corporation solely by reason of his being an officer or director of such
corporation.
"CONTROLLED GROUP" means, as to any Person, all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated)
which are under common control with such Person and which, together with such
Person, are treated as a single employer under Section 414(b), (c), (m) or (o)
of the Code.
"CONVERSION OR CONTINUANCE NOTICE" has the meaning set forth in SECTION
2.08(b).
"CONVERTIBLE SUBORDINATED DEBT" means all unsecured Debt of Parent which
shall (a) contain or have applicable thereto terms and provisions in form and
substance satisfactory to Determining Lenders, including, without limitation,
(i) subordination thereof to other Debt of Parent, including, without
limitation, the Obligations, and (ii) covenants, events of default and other
provisions, (b) have no principal payment prior to April 18, 2002, and (c)
contain a right for the holder thereof to convert such Debt to an equity
interest in Parent under certain circumstances.
8
"CURRENT ASSETS" means the current assets of Parent and its Subsidiaries on
a consolidated basis determined in accordance with GAAP.
"CURRENT LIABILITIES" means the sum of (a) current liabilities of Parent
and its Subsidiaries on a consolidated basis determined in accordance with
GAAP, plus (b) to the extent not included in CLAUSE (a), the unpaid principal
amount of all outstanding Advances, all accrued unpaid interest on Advances and
all Reimbursement Obligations.
"DEBT" means all obligations, contingent or otherwise, which in accordance
with GAAP are required to be classified on the balance sheet as liabilities, and
in any event including Capital Leases, Contingent Liabilities that are required
to be disclosed and quantified in notes to consolidated financial statements in
accordance with GAAP, and liabilities secured by any Lien on any Property,
regardless of whether such secured liability is with or without recourse.
"DEBTOR RELIEF LAWS" means applicable bankruptcy, reorganization,
moratorium, or similar Laws, or principles of equity affecting the enforcement
of creditors' rights generally.
"DEFAULT" means any event specified in SECTION 7.01, whether or not any
requirement in connection with such event for the giving of notice, lapse of
time, or happening of any further condition has been satisfied.
"DETERMINING LENDERS" means any combination of Lenders whose allocations as
set forth on SCHEDULE 1.01 are at least 66.67% of $100,000,000.
"DISPOSITION VALUE" means, at any time, with respect to any Property, the
book value thereof, valued at the time of such disposition in good faith by the
owner of such Property.
"DISTRIBUTION" means, as to any Person, (a) any declaration or payment of
any distribution or dividend (other than a stock dividend) on, or the making of
any pro rata distribution, loan, advance, or investment to or in any holder (in
its capacity as a partner, shareholder or other equity holder) of, any
partnership interest or shares of capital stock or other equity interest of such
Person, or (b) any purchase, redemption, or other acquisition or retirement for
value of any shares of partnership interest or capital stock or other equity
interest of such Person.
"DOLLARS" and "$" mean lawful currency of the United States of America.
"DOMESTIC ADVANCE" means an advance made by a Lender to Parent pursuant to
SECTION 2.01(a).
"DOMESTIC COMMITMENT" means $80,000,000, as reduced from time to time
pursuant to SECTION 2.10 or 7.02.
9
"DOMESTIC LENDER" means the domestic lenders listed on the signature pages
of this Agreement, and each Eligible Assignee which hereafter becomes a party to
this Agreement pursuant to SECTION 9.04 as a Domestic Lender.
"EBITDA" means, as of any date of determination, (a) the sum of Parent's
and its Subsidiaries' (i) pre-tax income or deficit, as the case may be
(excluding extraordinary items and income from the sale of assets other than in
the ordinary course of business), plus (ii) cash interest expense paid;
amortization of Debt discounts; any payments or fees with respect to letters of
credit, bankers' acceptances or similar facilities; fees and expenses with
respect to interest rate swap or similar agreements or foreign currency hedge,
exchange or similar agreements, plus (iii) depreciation and amortization
expense, plus (iv) cash interest paid with respect to Capital Leases, plus (v)
other non-cash charges of Parent and its Subsidiaries for such period deducted
from consolidated revenues in determining net income for such period; and minus
(b) non-cash items of Parent and its Subsidiaries for such period increasing
consolidated revenues in determining net income for such period, all calculated
on a consolidated basis in accordance with GAAP.
"EBITDAR" means, as of any date of determination, (a) the sum of Parent's
and its Subsidiaries' (i) pre-tax income or deficit, as the case may be
(excluding extraordinary items and income from the sale of assets other than in
the ordinary course of business), plus (ii) cash interest expense paid;
amortization of Debt discounts; any payments or fees with respect to letters of
credit, bankers' acceptances or similar facilities; fees and expenses with
respect to interest rate swap or similar agreements or foreign currency hedge,
exchange or similar agreements, plus (iii) depreciation and amortization
expense, plus (iv) lease payments paid pursuant to Operating Leases, plus (v)
cash interest paid with respect to Capital Leases, plus (vi) other non-cash
charges of Parent and its Subsidiaries for such period deducted from
consolidated revenues in determining net income for such period; and minus (b)
non-cash items of Parent and its Subsidiaries for such period increasing
consolidated revenues in determining net income for such period, all calculated
on a consolidated basis in accordance with GAAP.
"EFFECTIVE DATE" means January 30, 1997.
"EIGHTY PERCENT-OWNED SUBSIDIARY" means, at any time, any Subsidiary at
least 80% of all the equity interest (except directors' qualifying shares) and
voting interests of which are owned by any one or more of Parent and its
Wholly-Owned Subsidiaries at such time.
"ELIGIBLE ACCOUNTS" means at the time of any determination thereof each
Account as to which the following requirements have been fulfilled to the
satisfaction of Agent, or Canadian Agent, as the case may be:
(a) Parent, Ashley, Cameron or CA Canada as appropriate, has lawful
and absolute title to such Account;
10
(b) Such Account is a valid, legally enforceable obligation of the
Person who is obligated under such Account (the "ACCOUNT DEBTOR") for goods
or services delivered or rendered to such Person, subject to Debtor Relief
Laws which may be applicable to the account debtor, provided that the
account debtor is not subject to any proceeding involving Debtor Relief
Laws other than as a creditor;
(c) There has been excluded from such Account any portion that is
subject to any dispute, offset, counterclaim, rebate or other claim or
defense on the part of the account debtor or to any claim on the part of
the account debtor denying liability under such Account known to Parent,
Ashley, Cameron or CA Canada as appropriate;
(d) Such Account is evidenced by an invoice rendered to the account
debtor and such Account is not evidenced by any chattel paper, promissory
note or other instrument;
(e) Such Account is not subject to any security interest or other
Lien, except landlord and similar Liens and Liens incurred in the ordinary
course of business in connection with worker's compensation, unemployment
insurance or similar legislation; PROVIDED such Liens only relate to
amounts not yet due and payable;
(f) Fewer than ninety days have elapsed since the date specified in
any invoice with respect to such Account as the due date for any amount
stated on such invoice; and
(g) No account debtor in respect of such Account is (i) primarily
conducting business in any jurisdiction located outside the United States
of America or Canada unless otherwise acceptable to Agent and Canadian
Agent, (ii) any Tribunal, domestic or foreign unless otherwise acceptable
to Agent or Canadian Agent, as the case may be (as evidenced by such
Agent's specific written acceptance), or (iii) the subject of a proceeding
under any Debtor Relief Laws, PROVIDED, HOWEVER, notwithstanding this
CLAUSE (III), PROVIDED that all the other requirements of Eligible Accounts
are fulfilled to the satisfaction of Agent or Canadian Agent, as the case
may be, accounts of other Persons acceptable to Agent or Canadian Agent, as
the case may be (which acceptance shall be evidenced solely by such Agent's
specific written consent) which are the subject of a proceeding under
Debtor Relief Laws shall be Eligible Accounts; PROVIDED, that, no accounts
payable by an account debtor shall constitute Eligible Accounts if 10% or
more of the aggregate dollar amount of all Accounts owed to Parent, Ashley,
Cameron or CA Canada, as appropriate, by such account debtor have been due
and payable for 120 days or more from the date specified in any invoice
with respect to such Account as the due date for any amount stated in such
invoice; PROVIDED, FURTHER, if the accounts payable by an account debtor
and all Affiliates of such account debtor shall constitute 15% or more of
the aggregate dollar amount of all Accounts owed to Parent, Ashley, Cameron
or CA Canada, as appropriate, the dollar amount of such accounts payable of
such account debtor and its Affiliates in excess of 15% of the aggregate
amount of all Accounts owed to Parent, Ashley, Cameron or CA Canada, as
appropriate, shall be excluded in each determination of Eligible Accounts.
11
"ELIGIBLE ASSIGNEE" means (a) a commercial bank organized under the laws of
the United States, or any state thereof, or the laws of Canada, or any province
thereof, and having total assets in excess of the equivalent of $500,000,000;
(b) a savings and loan association or savings bank organized under the laws of
the United States, or any state thereof, or Canada, or any province thereof,
having total assets in excess of the equivalent of $500,000,000, and not in
receivership or conservatorship; (c) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development, or a political subdivision of any such country, and
having total assets in excess of the equivalent of $500,000,000, provided that
such bank is acting through a branch or agency located in the country in which
it is organized or another country which is described in this clause; and
(d) the central bank of any country which is a member of the Organization for
Economic Cooperation and Development.
"ELIGIBLE INVENTORY" means at any date the lesser of the actual cost or the
current fair market value of Inventory (excluding goods in transit and work in
progress) of Parent, Ashley, Cameron or CA Canada, as appropriate, determined in
accordance with GAAP, provided that such Inventory shall constitute Eligible
Inventory only if on the date as of which the determination is being made (a) it
shall have been either (i) paid for or (ii) purchased on open account from a
vendor who does not have a purchase money security interest or other Lien on
either the acquired Inventory or any other Property of Parent, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
or CA Canada, as appropriate, to secure the purchase price, (b) it shall not be
damaged or obsolete, (c) it shall not have exceeded its normal shelf life, (d)
it shall not be subject to any Lien or security interest, except landlord and
similar Liens and Liens incurred in the ordinary course of business in
connection with worker's compensation, unemployment insurance or similar
legislation; PROVIDED such Liens only relate to amounts not yet due and payable,
(e) Parent, Ashley, Cameron or CA Canada, as appropriate, shall have lawful and
absolute title to it, (f) it is located in the United States of America or
Canada, and (g) Parent, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ or CA Canada, as appropriate, is neither
consignor nor consignee with respect to such Inventory.
"ENVIRONMENTAL CLAIM" means any written notice by any Tribunal alleging
potential liability for damage to the environment, or by any Person alleging
potential liability for personal injury (including sickness, disease or death),
resulting from or based upon (a) the presence or release (including sudden or
non-sudden, accidental or non-accidental, leaks or spills) of any Hazardous
Material at, in or from property, whether or not owned by Parent or any of its
Subsidiaries, or (b) circumstances forming the basis of any violation, or
alleged violation, of any Environmental Law.
"ENVIRONMENTAL LAWS" means the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 9601 ET SEQ.) ("CERCLA"), the
Hazardous Material Transportation Act (49 U.S.C. Section 1801 ET SEQ.), the
Resource Conservation and Recovery Act (42 U.S.C Section 6901 ET SEQ.), the
Federal Water Pollution Control Act (33 U.S.C. Section 1251 ET SEQ.), the Clean
Air Act (42 U.S.C. Section 7401 ET SEQ.), the Toxic Substances Control Act (15
U.S.C. Section 2601 ET SEQ.), and the Occupational Safety and Health Act (29
U.S.C. Section 651 ET SEQ.) ("OSHA"), as such laws have been
12
or hereafter may be amended or supplemented, any and all analogous future
federal, or present or future state or local, Laws, and any and all analogous
present or future laws of Canada or any province or territory therein.
"EQUITY PROCEEDS" means the gross amount payable to Parent with respect to
each issuance of any equity interest of Parent on or after the Effective Date,
net only of actual costs and expenses payable by Parent to Persons not
Affiliates of Parent who provided underwriting, accounting, legal, or similar
services with respect to such issuance.
"EQUIVALENT AMOUNT" means, on any date, the amount of Dollars into which an
amount of Canadian Dollars may be converted at the Bank of Canada noon spot rate
in Toronto as at approximately 12:00 noon, Toronto time, on such date.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rulings and regulations issued thereunder, as from time to time
in effect.
"ERISA AFFILIATE" means any Person that for purposes of Title IV of ERISA
is a member of the controlled group of Parent or any Obligor, or is under common
control with Parent or any Obligor, within the meaning of Section 414(c) of the
Internal Revenue Code of 1986, as amended, and the regulations and rulings
issued thereunder.
"ERISA EVENT" means (a) a reportable event, within the meaning of Section
4043 of ERISA, unless the 30-day notice requirement with respect thereto has
been waived by the PBGC, (b) the issuance by the administrator of any Plan of a
notice of intent to terminate such Plan, pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment referred to in
Section 4041(e) of ERISA), (c) the cessation of operations at a facility in the
circumstances described in Section 4068(f) of ERISA, (d) the withdrawal by
Parent, any Subsidiary of Parent, or an ERISA Affiliate from a Multiple Employer
Plan during a Plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA, (e) the failure by Parent, any Subsidiary of
Parent, or any ERISA Affiliate to make a payment to a Plan required under
Section 302 of ERISA, (f) the adoption of an amendment to a Plan requiring the
provision of security to such Plan, pursuant to Section 307 of ERISA, or (g) the
institution by the PBGC of proceedings to terminate a Plan, pursuant to Section
4042 of ERISA, or the occurrence of any event or condition that constitutes
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, a Plan.
"EVENT OF DEFAULT" means any of the events specified in SECTION 7.01 of
this Agreement, provided there has been satisfied any requirement in connection
therewith for the giving of notice, lapse of time, or happening of any further
condition.
"FACILITY" means each piece of improved real property (whether owned or
leased) at which an Obligor conducts business operations.
13
"FAIR MARKET VALUE" means, at any time and with respect to any Property,
the sale value of such Property that would be realized in an arm's-length sale
at such time between an informed and willing buyer and an informed and willing
seller (neither being under a compulsion to buy or sell).
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of Dallas, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such date on such
transactions received by Agent from three federal funds brokers of recognized
standing selected by it.
"FIXED CHARGES COVERAGE RATIO" means, for Parent calculated for the 365-day
period ended on the date of calculation, the ratio of (a) EBITDAR, to (b) lease
payments paid pursuant to Operating Leases, plus all cash interest paid with
respect to Funded Debt and Capital Leases, plus all scheduled principal payments
with respect to Funded Debt.
"FLOOR RATE" means, for any day, the CDOR Screen Rate at or about 10:00
a.m., Toronto time on that day, plus 1%.
"FUNDED DEBT" means, as to any Person, at any date, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments
and (c) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business.
"FUNDED DEBT TO EBITDA RATIO" means, for any date of determination, the
ratio of (a) the amount of Funded Debt of Parent and its Subsidiaries as at the
date of determination, to (b) EBITDA for the 365-day period ended on the date of
determination.
"GAAP" means generally accepted accounting principles applied on a
consistent basis. Application on a consistent basis shall mean that the
accounting principles observed in a current period are comparable in all
material respects to those applied in a preceding period, except for new
developments or statements promulgated by the Financial Accounting Standards
Board.
"GUARANTORS" means each Person listed on SCHEDULE 3.01(f).
"GUARANTY" means a Guaranty executed by each Guarantor in substantially the
form of EXHIBIT B.
"HAZARDOUS MATERIALS" means all materials subject to any Environmental Law,
including without limitation materials listed in 49 C.F.R. Section 172.101,
Hazardous Substances, explosive or
14
radioactive materials, hazardous or toxic wastes or substances, petroleum or
petroleum distillates, asbestos, or material containing asbestos.
"HAZARDOUS SUBSTANCES" means hazardous waste as defined in the Clean Water
Act, 33 U.S.C. Section 1251 ET SEQ., the Comprehensive Environmental Response
Compensation and Liability Act as amended by the Superfund Amendments and
Reauthorization Act, 42 U.S.C. Section 9601 ET SEQ., the Resource Conservation
Recovery Act, 42 U.S.C. Section 6901 ET SEQ., and the Toxic Substances Control
Act, 15 U.S.C. Section 2601 ET SEQ and similar substances as defined in any
analogous laws of Canada or any province, territory, or municipality therein.
"HIGHEST LAWFUL RATE" means at the particular time in question the maximum
rate of interest which, under Applicable Law, any Lender is then permitted to
charge on the Obligations. If the maximum rate of interest which, under
Applicable Law, any Lender is permitted to charge on the Obligations shall
change after the date hereof, the Highest Lawful Rate shall be automatically
increased or decreased, as the case may be, from time to time as of the
effective time of each change in the Highest Lawful Rate without notice to
Borrowers. For purposes of determining the Highest Lawful Rate under Applicable
Law, the applicable rate ceiling shall be (a) the indicated rate ceiling
described in and computed in accordance with the provisions of Section (a)(l) of
Art. l.04; or (b) provided notice is given as required in Section (h)(l) of Art.
1.04, either the annualized ceiling or quarterly ceiling computed pursuant to
Section (d) of Art. 1.04; PROVIDED, HOWEVER, that at any time the indicated rate
ceiling, the annualized ceiling or the quarterly ceiling, as applicable, shall
be less than 18% per annum or more than 24% per annum, the provisions of
Sections (b)(1) and (2) of said Art. l.04 shall control for purposes of such
determination, as applicable.
"INSUFFICIENCY" means, with respect to any Plan, the amount, if any, of its
unfunded benefit liabilities within the meaning of Section 4001(a)(18) of ERISA.
"INTEREST HEDGE AGREEMENTS" means any interest rate swap agreements,
interest cap agreements, interest rate collar agreements, or any similar
agreements or arrangements designed to hedge the risk of variable interest rate
volatility, or foreign currency hedge, exchange or similar agreements, on terms
and conditions reasonably acceptable to Agent or Canadian Agent, as the case may
be (evidenced by such Agent's consent in writing), as such agreements or
arrangements may be modified, supplemented, and in effect from time to time.
"INTEREST PERIOD" means the period beginning on the date the Advance is
made, continued or accepted as a LIBOR Advance or as a Bankers' Acceptance and
ending one, two, three, or six months thereafter (as Parent or CA Canada, as the
case may be, shall select); PROVIDED, HOWEVER, that whenever the first day of
any Interest Period occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that succeeds such
initial calendar month by the number of months equal to the number of months in
such Interest Period, such Interest Period shall end on the last Business Day of
such succeeding calendar month.
15
"INVENTORY" means, with respect to any Person, any and all goods,
wheresoever located, including, without limitation, goods in transit, whether
now owned or hereafter acquired by such Person, which are held for sale or
lease, furnished under any contract of service or held as raw materials, work in
process or supplies, and all materials used or consumed in such Person's
business, including, without limitation, all such property the sale or other
disposition of which has given rise to Accounts of such Person and which has
been returned to or repossessed or stopped in transit by such Persons and all
"inventory" as such term is defined under Applicable Law.
"INVESTMENT" means any acquisition of all or substantially all assets of
any Person, or any direct or indirect purchase or other acquisition of, or a
beneficial interest in, capital stock or other securities of any other Person,
or any direct or indirect loan, advance (other than advances to employees for
moving and travel expenses, drawing accounts, and similar expenditures in the
ordinary course of business), or capital contribution to or investment in any
other Person, including without limitation the incurrence or sufferance of Debt
or accounts receivable of any other Person that are not current assets or do not
arise from sales to that other Person in the ordinary course of business.
"ISSUING BANK" means NationsBank of Texas, N.A., in its capacity as issuer
of a Letter of Credit pursuant to SECTION 2.15.
"LAW" means any constitution, statute, law, ordinance, regulation, rule,
order, writ, injunction, or decree of any Tribunal.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified in SECTION 2.15(f).
"L/C RELATED DOCUMENTS" has the meaning specified in SECTION 2.15(e).
"LEASE RENTALS" means, with respect to any period, the sum of the minimum
amount of rental and other obligations required to be paid during such period by
Parent or any Subsidiary of Parent as lessee under all leases of real or
personal property (other than Capital Leases), EXCLUDING any amounts required to
be paid by the lessee (whether or not therein designated as rental or additional
rental) (a) which are on account of maintenance and repairs, insurance, taxes,
assessments, water rates and similar charges, or (b) which are based on profits,
revenues or sales realized by the lessee from the leased property or otherwise
based on the performance of the lessee.
"LENDER AFFILIATE" means the holding company of any Lender, or any
wholly-owned direct or indirect subsidiary of such holding company or of such
Lender.
"LENDERS" means each Canadian Lender and each Domestic Lender.
"LENDING OFFICE" means, with respect to each Lender, its branch or
affiliate, (a) initially, the office of each Lender, branch or affiliate
identified as such on SCHEDULE 9.02, and (b)
16
subsequently, such other office of each Lender, branch or affiliate as each
Lender may designate to Borrowers, Agent and Canadian Agent as the office
from which the Advances of each Lender will be made and maintained and for
the account of which all payments of prin cipal and interest on the Advances
and the Commitment Fee will thereafter be made. Lenders may have more than
one Lending Office for the purpose of making Base Advances, LIBOR Advances,
Canadian Advances, bearing interest at either the Canadian Prime Rate or the
U.S. Base Rate and Canadian Advances by way of Bankers' Acceptances.
"LETTER OF CREDIT" has the meaning specified in SECTION 2.15(a).
"LETTER OF CREDIT AGREEMENT" has the meaning specified in SECTION 2.15(b).
"LETTER OF CREDIT FACILITY" has the meaning specified in SECTION 2.15(a).
"LIBOR ADVANCE" means a Domestic Advance bearing interest at the LIBOR
Rate.
"LIBOR LENDING OFFICE" means, with respect to each Lender, the office
designated as its "LIBOR Lending Office" below its name on SCHEDULE 9.02, or
such other office of Lender or any of its affiliates hereafter designated by
notice to Parent and Agent.
"LIBOR RATE" means a simple per annum interest rate equal to the lesser of
(a) the Highest Lawful Rate, and (b) the sum of the LIBOR Rate Basis plus the
Applicable Margin. The LIBOR Rate shall, with respect to LIBOR Advances subject
to reserve or deposit requirements, be subject to premiums assessed therefor by
each Lender, which are payable directly to each Lender. Once determined, the
LIBOR Rate shall remain unchanged during the applicable Interest Period.
"LIBOR RATE BASIS" means, for any Interest Period, the interest rate per
annum (rounded upward to the nearest 1/16th of one percent) determined by Agent
at approximately 9:00 a.m., on the date which is two Business Days before the
first day of such Interest Period to be the offered quotations that appear on
the ▇▇▇▇▇▇'▇ Screen LIBOR page for dollar deposits in the London interbank
market for a length of time approximately equal to the Interest Period for the
LIBOR Advance sought by Parent. If at least two such offered quotations appear
on the ▇▇▇▇▇▇'▇ Screen LIBOR page, the LIBOR Rate shall be the arithmetic mean
(rounded upward to the nearest 1/16th of one percent) of such offered
quotations, as determined by Agent. If the ▇▇▇▇▇▇'▇ Screen LIBOR page is not
available or has been discontinued, the LIBOR Rate Basis shall be the rate per
annum that Agent determines to be the arithmetic mean (rounded as aforesaid) of
the per annum rates of interest at which deposits in dollars in an amount
approximately equal to the principal amount of, and for a length of time
approximately equal to the Interest Period for, the LIBOR Advance sought by
Parent are offered to Agent in immediately available funds in the London
interbank market at 11:00 a.m., London time, on the date which is two Business
Days prior to the first day of an Interest Period.
17
"LICENSE" means, as to any Person, any license, permit, certificate of
need, authorization, certification, accreditation, franchise, approval, or grant
of rights by, or any filing or registration with, any Tribunal or third person
necessary or appropriate for such Person to own, maintain, or operate its
business or Property, including, but not limited to, the sale of Inventory.
"LIEN" means any mortgage, pledge, security interest, encumbrance, lien, or
charge of any kind, including without limitation any agreement to give or not to
give any of the foregoing, any conditional sale or other title retention
agreement, any lease in the nature thereof, and the filing of or agreement to
give any financing statement or other similar form of public notice under the
Laws of any jurisdiction (except for the filing of a financing statement or
notice in
connection with an (a) Operating Lease or (b) the true consignment of goods to
Parent or any Subsidiary of Parent as consignee).
"LITIGATION" means any proceeding, claim, lawsuit, arbitration, and/or
investigation conducted or threatened by or before any Tribunal or arbitrator,
including without limitation proceedings, claims, lawsuits, and/or
investigations under or pursuant to any environmental, occupational, safety and
health, antitrust, unfair competition, securities, Tax, or other Law, or under
or pursuant to any contract, agreement, or other instrument.
"LOAN PAPERS" means this Agreement; the Notes; all Interest Rate Hedge
Agreements; each Guaranty and all other guaranties executed by any Person
guaranteeing payment of any portion of the obligations of any Person under this
Agreement, the Notes or any related agreement; all L/C Related Documents and
Canadian L/C Related Documents; all letters of credit issued by any Lender for
the account of any Obligor, and the application and all documentation related to
any such letter of credit; each Assignment and Acceptance; all promissory notes
evidencing any portion of the obligations under this Agreement; assignments,
security agreements, pledge agreements, mortgages, deeds of trust, financing
statements, collateral assignments, and other documents and instruments granting
an interest in any collateral, or related to the perfection and/or the transfer
thereof; and all other documents, instruments, agreements or certificates
executed or delivered by Borrowers or any other Person, as security for any
Obligor's obligations hereunder, in connection with the loans and other
extensions of credit to or for the benefit of Borrowers or otherwise; as each
such document shall, with the consent of Agent, Canadian Agent, Issuing Bank,
Canadian Issuing Bank (if required by the terms hereof) and Lenders pursuant to
the terms hereof, be amended, extended, or restated.
"MATERIAL ADVERSE CHANGE" means any circumstance or event that is or would
reasonably be expected to (a) be material and adverse to the financial
condition, business operations, prospects, or Properties of any Obligor or (b)
materially affect the validity or enforceability of any Loan Paper.
"MATURITY DATE" means January 15, 2002 with respect to the Domestic
Commitment and January 15, 2002 with respect to the Canadian Commitment, or the
earlier date of termination in whole of the Commitment pursuant to SECTION 2.10
or 7.02.
18
"MAXIMUM AMOUNT" means the maximum amount of interest which, under
Applicable Law, a Lender is permitted to charge on the Obligations.
"MONEY MARKET INSTRUMENTS" means United States Governmental Securities
described in CLAUSE (e) of the definition of "RESTRICTED INVESTMENTS" and
commercial paper described in CLAUSE (g) of the definition of "RESTRICTED
INVESTMENTS".
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which Parent, any Subsidiary, or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions,
such plan being maintained pursuant to one or more collective bargaining
agreements.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of Parent,
any Subsidiary of Parent, or any ERISA Affiliate and at least one Person other
than Parent, any Subsidiary of Parent, and any ERISA Affiliate, or (b) was so
maintained and in respect of which Parent, any Subsidiary of Parent, or any
ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in the
event such plan has been or were to be terminated.
"NET INCOME" means with reference to any period, for Parent, determined in
accordance with GAAP, net profit or loss for such period.
"NOTE" means each and "NOTES" means all Notes of Borrowers evidencing the
Advances and obligations owing hereunder to each Lender, in substantially the
form of EXHIBIT A with respect to Domestic Advances and substantially in the
form of EXHIBIT K with respect to Canadian Advances, payable to the order of
each Lender, together with each renewal, amendment, and restatement thereof.
"NOTE PURCHASE AGREEMENT" means each Note Purchase Agreement dated as of
April 1, 1996 between Parent and each Senior Holder.
"NOTICE OF ISSUANCE" has the meaning specified in SECTION 2.15(b) with
respect to a Letter of Credit and the meaning specified in SECTION 2.16(b) with
respect to a Canadian Letter of Credit.
"OBLIGATIONS" means all present and future obligations, indebtedness and
liabilities, and all renewals and extensions of all or any part thereof, of
Borrowers and any other Person (other than Lenders, Issuing Bank, Canadian
Issuing Bank, Canadian Agent and Agent) to Lenders, Issuing Bank, Canadian
Issuing Bank, Canadian Agent and Agent arising from, by virtue of, or pursuant
to this Agreement, any of the other Loan Papers and any and all renewals and
extensions thereof or any part thereof, or future amendments thereto, all
interest accruing on all or any part
19
thereof and reasonable attorneys' fees incurred by Lenders, Issuing Bank,
Canadian Issuing Bank, Canadian Agent and Agent for the administration,
execution of waivers, amendments and consents, and in connection with any
restructuring, workouts or in the enforcement or the collection of all or any
part thereof, whether such obligations, indebtedness and liabilities are
direct, indirect, fixed, contingent, joint, several or joint and several.
Without limiting the generality of the foregoing, "Obligations" includes all
amounts that would be owed by Borrowers and any other Person (other than
Agent, Issuing Bank, Canadian Issuing Bank, Canadian Agent or Lenders) to
Agent, Canadian Agent, Canadian Issuing Bank, Issuing Bank or Lenders under
any Loan Paper, but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving either of Borrowers or any other Person (including all such amounts
which would become due or would be secured but for the filing of any petition
in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding of either of Borrowers or any other Person under any Debtor Relief
Law).
"OBLIGOR" means (a) Parent, (b) CA Canada, (c) each other Person liable for
performance of any of the Obligations, and (d) each other Person the Property of
which secures the performance of any of the Obligations.
"OPERATING LEASES" mean operating leases, as defined in accordance with
GAAP.
"PARENT GUARANTY" means the Guarantees executed by Parent and Cameron with
respect to CA Canada's Obligations under this Agreement in substantially the
form of EXHIBIT N.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
agency or entity performing substantially the same functions.
"PERMITTED ACQUISITION" means (a) the acquisition of the capital stock or
other equity interest of any Person which will be, immediately after such
acquisition, an Eighty-Percent Owned Subsidiary or (b) the acquisition of assets
of any Person constituting or related to a particular line of business of any
Person; PROVIDED, (i) in the case of a proposed acquisition described in CLAUSE
(a), substantially all business operations of such Person to be acquired are in
business lines related to the business lines of Parent, CA Canada, and
Guarantors, (ii) in the case of a proposed acquisition described in CLAUSE (b),
the assets or line of business of such Person to be acquired are in business
lines related to the business lines of Parent, CA Canada, and Guarantors, (iii)
the Board of Directors, general partners or other governing body of such Person
has approved such transaction and such approval has not been revoked, and (iv)
such transaction is not the subject of pending Litigation; PROVIDED, FURTHER,
the business lines of Borrowers and Guarantors shall be deemed to not include
any line of business of CAFS.
"PERMITTED AMOUNT" means the difference between (a) the sum of (i)
$10,000,000 plus (ii) 60% of cumulative Net Income reported for each fiscal year
of Parent in which Net Income is a positive number, commencing with the fiscal
year of Parent ending on October 31, 1996, plus (iii) 100% of cumulative Net
Income reported for each fiscal year of Parent in which Net Income is
20
a negative number (expressed as a negative number), commencing with the
fiscal year of Parent ending on October 31, 1996, minus (b) the aggregate
amount of all cash Distributions made by Parent on and after the Effective
Date.
"PERMITTED DISPOSITIONS" means (a) sales or dispositions of assets in the
ordinary course of business for full and fair consideration, (b) sales or
dispositions of tangible assets determined in good faith by such Person to be
obsolete or no longer useful in such Person's operations and (c) other Transfer
if (i) such Transfer is, in the good faith opinion of Parent, in exchange for
consideration having a Fair Market Value at least equal to that of the property
exchanged and is in the best interest of Parent or the Subsidiary of Parent
which owns such Property; (ii) immediately after giving effect to the Transfer,
no Default or Event of Default would exist; and (iii) if immediately after
giving effect to the Transfer, (A) the Disposition Value of all the property of
Parent and its Subsidiaries that was the subject of any Transfer occurring in
the period of four fiscal quarters of Parent then next ending would not exceed
15% of Consolidated Assets as of the end of the then most recently ended fiscal
quarter of Parent, and (B) the Disposition Value of all property that was the
subject of all Transfers occurring on or after the Effective Date would not
exceed 30% of Consolidated Assets as of the end of the then most recently ended
fiscal quarter of Parent.
"PERSON" means an individual, partnership, joint venture, corporation,
trust, Tribunal, unincorporated organization, and government, or any department,
agency, or political subdivision thereof.
"PROHIBITED TRANSACTION" has the meaning specified in Section 4975 of the
Internal Revenue Code of 1986, as amended, or Section 406 of Title I of ERISA.
"PROPERTY" means all types of real, personal, tangible, intangible, or
mixed property, whether owned or hereafter acquired in fee simple or leased by
each Obligor.
"PRO RATA" means, as to any Lender, in accordance with its percentage of
the aggregate amount of outstanding Advances expressed in Dollars as of the date
of determination; PROVIDED, HOWEVER, that if no Advances are outstanding, such
term means in accordance with such Lender's Specified Percentage.
"QUARTERLY DATE" means the last day of each January, April, July and
October during the term of this Agreement.
"RATABLE" means, as to any Lender, in accordance with its Specified
Percentage.
"REALLOCATION NOTICE" means the notice described in SECTION 2.17(a)
executed by Borrowers in the form of EXHIBIT L.
21
"REFINANCING ADVANCE" means any Advance which is used to pay the principal
amount (or any portion thereof) of an Advance at the end of its Interest Period
and which, after giving effect to such application, does not result in an
increase in the aggregate amount of outstanding Advances.
"REIMBURSEMENT OBLIGATIONS" means, in respect of any Letter of Credit or
Canadian Letter of Credit as at any date of determination, the sum of (a) the
maximum aggregate amount which is then available to be drawn under such Letter
of Credit or Canadian Letter of Credit, plus (b) the aggregate amount of all
drawings under such Letter of Credit or Canadian Letter of Credit not
theretofore reimbursed by Borrowers.
"REPURCHASE AGREEMENT" means any written agreement
(a) that provides for (i) the transfer of one or more Money Market
Instruments in an aggregate principal amount at least equal to the amount
of the Transfer Price (defined below) to Parent or any of its Subsidiaries
from an Acceptable Bank or an Acceptable Broker-Dealer against a transfer
of funds (the "TRANSFER PRICE") by Parent or such Subsidiary to such
Acceptable Bank or Acceptable Broker-Dealer, and (ii) a simultaneous
agreement by Parent or such Subsidiary, in connection with such transfer of
funds, to transfer to such Acceptable Bank or Acceptable Broker-Dealer the
same or substantially similar Money Market Instruments for a price not less
than the Transfer Price plus a reasonable return thereon at a date certain
not later than 365 days after such transfer of funds,
(b) in respect of which Parent or such Subsidiary shall have the
right, whether by contract or pursuant to Applicable Law, to liquidate such
agreement upon the occurrence of any default thereunder; and
(c) in connection with which Parent or such Subsidiary, or an agent
thereof, shall have taken all action required by Applicable Law or
regulations to perfect a Lien in such Money Market Instruments.
"RESTRICTED INVESTMENTS" means the following:
(a) property to be used in the ordinary course of business of Parent
and its Subsidiaries;
(b) current assets arising from the sale of goods and services in the
ordinary course of business of Parent and its Subsidiaries;
(c) Permitted Acquisitions,
(d) Investments existing on the Effective Date and disclosed in
SCHEDULE 4.12;
22
(e) Investments in United States Governmental Securities, PROVIDED
that such obligations mature within thirty-six months from the date of
acquisition thereof;
(f) Investments in certificates of deposit, time deposits or banker's
acceptances maturing within 365 days from the date of acquisition thereof
either (i) issued by an Acceptable Bank, or (ii) issued by any other bank
with which Parent has a banking relationship and which is organized under
the laws of the United States of America or any State thereof, PROVIDED
that the aggregate amount of the Investments of Parent permitted by this
CLAUSE (ii) shall not exceed $10,000,000;
(g) Investments in commercial paper given the highest rating by a
credit rating agency of recognized national standing and maturing not more
than 270 days from the date of creation thereof;
(h) Investments in Repurchase Agreements;
(i) Investments in tax-exempt obligations of any state of the United
States of America, or any municipality of any such state, in each case
rated "AA" or better by S&P, "Aa2" or better by Moody's or an equivalent
rating by any other credit rating agency of recognized national standing,
PROVIDED that such obligations mature within 365 days from the date of
acquisition thereof;
(j) loans or advances in the usual and ordinary course of business to
officers, directors and employees for expenses (including moving expenses
related to a transfer) incidental to carrying on the business of Parent or
any Subsidiary of Parent; and
(k) Investments in the shares of registered investment companies
commonly known as "money market funds", PROVIDED that the aggregate net
asset value of any such investment company shall be $1,000,000,000 or more
and the investment policies of such investment companies shall limit them
to Money Market Instruments.
As of any date of determination, each Restricted Investment shall be valued
at the greater of:
(x) the amount at which such Restricted Investment is shown on the
books of Parent or any of its Subsidiaries (or zero if such Restricted
Investment is not shown on any such books); and
(y) either
(i) in the case of any guaranty of the obligation of any Person,
the amount which Parent or any of its Subsidiaries has paid on account
of such
23
obligation less any recoupment by Parent or such Subsidiary of
any such payments, or
(ii) in the case of any other Restricted Investment, the excess
of:
(x) the greater of (A) the amount originally entered on the
books of Parent or any of its Subsidiaries with respect thereto
and (B) the cost thereof to Parent or its Subsidiary over
(y) any return of capital (after income taxes applicable
thereto) upon such Restricted Investment through the sale or
other liquidation thereof or part thereof or otherwise.
"RESTRICTED PAYMENTS" means (a) any direct or indirect Distribution,
dividend or other payment on account of any equity interest in, or shares of
capital stock or other securities of, Parent or any of its Subsidiaries; and (b)
any management, consulting or other similar fees, or any interest thereon,
payable by Parent or any of its Subsidiaries to any Affiliate of Parent, or to
any other Person other than an unrelated third party.
"RIGHTS" means rights, remedies, powers, and privileges.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc.
"SALE-AND-LEASEBACK" means a transaction or series of transactions pursuant
to which Parent or any Subsidiary of Parent shall sell or transfer to any Person
(other than Parent or a Wholly-Owned Subsidiary) any Property, whether now owned
or hereafter acquired, which, at the time of such transaction has been owned for
more than 180 days by Parent or such Subsidiary of Parent, and, as part of the
same transaction or series of transactions, Parent or such Subsidiary of Parent
shall rent or lease as lessee, or similarly acquire the right to possession or
use of, such Property or one or more properties which it intends to use for the
same purpose or purposes as such Property for a term of thirty-six months or
longer.
"SENIOR HOLDER" means each Person named on SCHEDULE 4.08-a, and each
permitted successor and assign.
"SENIOR NOTE PAPERS" means each Note Purchase Agreement, each Senior Note,
all guaranties executed by any Person guaranteeing payment of any portion of the
obligations of any Person under any Note Purchase Agreement or Senior Note; all
promissory notes evidencing any portion of the obligations under any Note
Purchase Agreement or Senior Note; assignments, security agreements, pledge
agreements, mortgages, deeds of trust, financing statements, collateral
assignments, and other documents and instruments granting an interest in any
collateral, or related to the perfection and/or the transfer thereof; and all
other documents, instruments, agreements or
24
certificates executed or delivered by Parent or any other Person, as security
for any Person's obligations thereunder; as each such document shall be
amended, extended, or restated.
"SENIOR NOTES" means each note issued pursuant to each Note Purchase
Agreement.
"SEPARATENESS AGREEMENT" means the agreement in the form of EXHIBIT M.
"SINGLE EMPLOYER PLAN" means a single employer plan, as defined in Section
4001(a)(15) of ERISA, other than a Multiple Employer Plan of Parent.
"SOLVENT" means, with respect to any Person, that on such date (a) the fair
value of the Property of such Person is greater than the total amount of
liabilities, including without limitation Contingent Liabilities of such Person,
(b) the present fair salable value of the assets of such Person is not less than
the amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured, (c) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature, and (d) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's Property would constitute
an unreasonably small capital.
"SPECIAL COUNSEL" means the law firm of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.C.,
Dallas, Texas, or such other individual or firm acting as special counsel to
Agent.
"SPECIFIED PERCENTAGE" means (a) with respect to any Domestic Lender, a
fraction (expressed as a percentage), the numerator of which shall be the Dollar
amount of such Domestic Lender's portion of the Domestic Commitment and the
denominator of which shall be the total Domestic Commitment, (b) with respect to
any Canadian Lender, a fraction (expressed as a percentage), the numerator of
which shall be the Canadian Dollar amount of such Canadian Lender's portion of
the Canadian Commitment and the denominator of which shall be the total Canadian
Commitment, in each case such percentage indicated beside its name on SCHEDULE
1.01, or as adjusted or specified in any Assignment and Acceptance, and with
respect to the use of the term "Ratable" for the overall Commitment, as
distinguished from the Domestic Commitment and the Canadian Commitment herein, a
fraction (expressed as a percentage), the numerator of which shall be each
Lender's allocated amount as set forth on SCHEDULE 1.01 under Specified
Percentage and the denominator of which is $100,000,000.
"SUBSIDIARY" of any Person means any corporation, partnership, joint
venture, trust or estate of which (or in which) 50% or more of:
(a) the outstanding capital stock having voting power to elect a
majority of the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency),
25
(b) the interest in the capital or profits of such partnership or
joint venture, or
(c) the beneficial interest of such trust or estate,
is at the time directly or indirectly owned by such Person, by such Person
and one or more of its Subsidiaries or by one or more of such Person's
Subsidiaries.
"SWAP EXPOSURE" means the maximum amount of credit exposure under an
Interest Hedge Agreement, as determined by Agent or Canadian Agent, as the case
may be, as at the date of determination.
"TANGIBLE NET WORTH" means, as of any date, the total shareholder's equity
(including capital stock, additional paid-in capital and retained earnings after
deducting treasury stock) which would appear on a balance sheet of Parent
prepared as of such date in accordance with GAAP, less the aggregate book value
of intangible assets shown on such balance sheet (PROVIDED, goodwill shall not
be used in any determination of Tangible Net Worth if goodwill is shown on the
balance sheet as a negative number, PROVIDED FURTHER that goodwill shown on the
balance sheet as a positive number shall be deducted in determining Tangible Net
Worth).
"TAXES" means all taxes, assessments, imposts, fees, or other charges at
any time imposed by any Laws or Tribunal.
"TOTAL LIABILITIES" means the amount of total liabilities of Parent which
would be shown in accordance with GAAP on a balance sheet.
"TRANSFER" means, with respect to any Person, any transaction in which such
Person sells, conveys, transfers or leases (as lessor) any of its Property.
"TRIBUNAL" means any state, commonwealth, federal, foreign, territorial,
provincial, municipal, or other court or government body, subdivision, agency,
department, commission, board, bureau, or instrumentality of a governmental
body.
"TYPE" refers to the distinction between Advances bearing interest at the
Base Rate, the LIBOR Rate, the Canadian Prime Rate, and the U.S. Base Rate.
"UCC" means the Uniform Commercial Code as adopted in the State of Texas on
the Effective Date.
"UNITED STATES GOVERNMENTAL SECURITY" means any direct obligation of, or
obligation guaranteed by, the United States of America, or any agency controlled
or supervised by or acting as an instrumentality of the United States of America
pursuant to authority granted by the Congress of the United States of America,
so long as such obligation or guarantee shall have the
26
benefit of the full faith and credit of the United States of America which
shall have been pledged pursuant to authority granted by the Congress of the
United States of America.
"U.S. BASE RATE" means the variable rate of interest quoted by the Canadian
Agent from time to time as the reference rate of interest which it employs to
determine the interest rate it will charge for demand loans in U.S. dollars to
its customers in Canada and which it designates as its "U.S. Base Rate".
"U.S. BASE RATE ADVANCE" means a Canadian Advance bearing interest at the
U.S. Base Rate.
"WHOLLY-OWNED SUBSIDIARY" means, at any time, any Person 100% of all of the
equity interests (except directors' qualifying shares) and voting interests of
which are owned by (a) Parent, (b) any Person 100% of all of the equity
interests (except directors' qualifying shares) and voting interests of which
are owned by Parent, or (c) Parent and any one or more Persons described in
CLAUSE (b).
"WITHDRAWAL LIABILITY" has the meaning given such term under Part I of
Subtitle E of Title IV of ERISA.
1.02. ACCOUNTING AND OTHER TERMS. All accounting terms used in this
Agreement which are not otherwise defined herein shall be construed in
accordance with GAAP consistently applied on a consolidated basis for Parent and
its Subsidiaries, unless otherwise expressly stated herein. References herein
to one gender shall be deemed to include all other genders. Except where the
context otherwise requires, (a) definitions imparting the singular shall include
the plural and vice versa and (b) unless otherwise noted, all references to time
are deemed to refer to Dallas time or to Calgary, Alberta time with respect to
the Canadian Commitment.
1.03. COVENANT CALCULATIONS. For purposes of any calculations under
SECTIONS 5.01 through 5.09 and 5.14 which would include a period of
determination during which a Permitted Acquisition occurred, all amounts or
charges attributable to such Permitted Acquisition shall be included in such
calculations as if such Permitted Acquisition occurred on the first day of such
period.
ARTICLE II. AMOUNTS AND TERMS OF ADVANCES
2.01. THE ADVANCES.
(a) Each Domestic Lender severally agrees, on the terms and subject to the
conditions hereinafter set forth, to make Domestic Advances to Parent on any
Business Day during the period from the Effective Date to the Maturity Date, in
an aggregate principal amount not to exceed at any time outstanding such
Lender's Specified Percentage of the Domestic Commitment. Subject
27
to the terms and conditions of this Agreement, Parent may borrow, repay, and
reborrow the Domestic Advances; PROVIDED, HOWEVER, that immediately after
giving effect to each Advance pursuant to this SECTION 2.01, the sum of the
aggregate principal amount of the outstanding Domestic Advances and
Reimbursement Obligations with respect to Domestic Letters of Credit shall at
no time exceed the Domestic Commitment.
(b) Each Canadian Lender severally agrees, on the terms and subject to the
conditions hereinafter set forth, including without limitation, SECTION 2.18
hereof, to make Canadian Advances to CA Canada on any Business Day during the
period from the Effective Date to the Maturity Date, in an aggregate principal
amount not to exceed at any time outstanding such Lender's Specified Percentage
of the Canadian Commitment. Subject to the terms and conditions of this
Agreement, CA Canada may borrow, repay, and reborrow the Canadian Advances;
PROVIDED, HOWEVER, that immediately after giving effect to each Advance pursuant
to this SECTION 2.01, the sum of the aggregate principal amount of the
outstanding Canadian Advances and Reimbursement Obligations with respect to the
Canadian Letters of Credit shall at no time exceed the Canadian Commitment.
(c) Notwithstanding anything contained in this SECTION 2.01, the sum of the
aggregate principal amount of the outstanding Advances and Reimbursement
Obligations shall at no time exceed the Borrowing Base.
2.02. MAKING ADVANCES.
(a) Each Borrowing of Advances or rollover or conversion of Canadian
Advances (where permitted hereunder) shall be made upon the written notice of
Parent with respect to Domestic Advances and CA Canada with respect to Canadian
Advances or the rollover or conversion of Canadian Advances (where permitted
hereunder), (i) received by Agent not later than 10:00 a.m. two Business Days
prior to the date of the proposed Borrowing, in the case of LIBOR Advances; (ii)
received by Agent not later than 10:00 a.m. on the date of such Borrowing, in
the case of Base Advances; (iii) received by Canadian Agent no later than 10:00
a.m. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ time on the second Business Day immediately
preceding the drawdown date or the date of rollover or conversion, as
applicable, with respect to a drawdown, rollover or conversion of or into a
Bankers' Acceptance; and (iv) received by Canadian Agent no later than 10:00
a.m., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ time on the drawdown date or the date of rollover
or conversion, as applicable, in the case of all other Canadian Advances. Each
such notice of a Borrowing (a "BORROWING NOTICE") shall be irrevocable and shall
be by telecopy or telephone, promptly confirmed by letter, in substantially the
form of EXHIBIT D specifying therein:
(i) the date of such proposed Borrowing, or rollover or
conversion, which shall be a Business Day;
(ii) the specific details of any rollover or conversion permitted
hereunder which CA Canada may be requesting;
28
(iii) the Type of Advances of which the Borrowing is to be
comprised;
(iv) the amount of such proposed Borrowing which shall (A) not
exceed the unused portion of the Commitment, the Domestic Commitment or the
Canadian Commitment, (B) not, when added to the sum of the aggregate
principal amount of all outstanding Advances and Reimbursement Obligations,
exceed the Borrowing Base, (C) in the case of a Borrowing of Base Advances,
Canadian Prime Rate Advances, or U.S. Base Rate Advances, be in an amount
of not less than $500,000 or an integral multiple of $100,000 in excess
thereof of the respective currencies in which the proposed Borrowings are
to be made, and (D) in the case of a Borrowing of LIBOR Advances, or
Bankers' Acceptances, be in an amount of not less than $1,000,000 or an
integral multiple of $100,000 in excess thereof; and
(v) if the Borrowing is to be comprised of LIBOR Advances, or
Bankers' Acceptances, the duration of the initial Interest Period
applicable to such Advances.
If the Borrowing Notice fails to specify the duration of the initial
Interest Period for any Borrowing comprised of LIBOR Advances or Bankers'
Acceptances, such Interest Period shall be one month. Agent or Canadian Agent,
as the case may be, shall promptly notify Lenders of each such notice. Each
Domestic Lender shall, before 1:00 p.m. on the date of each Domestic Advance
hereunder (other than a Refinancing Advance), make available to Agent, at its
office at NationsBank Plaza, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, such
Lender's Specified Percentage of the aggregate Domestic Advances to be made on
that day in immediately available Dollar funds. Each Canadian Lender shall,
before 1:00 p.m. Calgary, Alberta, Canada time, on the date of each Canadian
Advance hereunder make available to Canadian Agent, at its office at the
Canadian Imperial Bank of Commerce, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇., ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇ ▇▇▇ ▇▇▇, such Lender's Specified Percentage of the aggregate Canadian
Advances to be made on that day in immediately available Canadian Dollar or
Dollar funds (as applicable).
(b) Unless any applicable condition specified in ARTICLE III has not been
satisfied, Agent will make the funds promptly available to Parent (other than
with respect to a Refinancing Advance) by crediting the account number
1292833788 of Parent on the books of Agent or such other account as shall have
been specified by Parent.
(c) Unless any applicable condition specified in ARTICLE III has not been
satisfied, Canadian Agent will make the funds promptly available to CA Canada by
crediting the account number ▇▇▇▇▇▇▇, Transit No. 9 of CA Canada on the books of
Canadian Agent or such other account as shall have been specified by CA Canada.
(d) After giving effect to any Borrowing, (i) there shall not be more than
five different Interest Periods in effect, and (ii) the sum of the aggregate
principal amount of all outstanding
29
Advances and Reimbursement Obligations shall not exceed the lesser of (A) the
Commitment and (B) the Borrowing Base.
(e) No Interest Period shall extend beyond the Maturity Date.
(f) Unless a Lender shall have notified Agent prior to the date of any
Advance that it will not make available its Specified Percentage of any Domestic
Advance, Agent may assume that such Lender has made the appropriate amount
available in accordance with SECTION 2.02(a), and Agent may, in reliance upon
such assumption, make available to Parent a corresponding amount. If and to the
extent any Lender shall not have made such amount available to Agent, such
Lender and Parent severally agree to repay to Agent immediately on demand such
corresponding amount together with interest thereon, from the date such amount
is made available to Parent until the date such amount is repaid to Agent, at
(i) in the case of Parent, the Base Rate, and (ii) in the case of such Lender,
the Federal Funds Rate.
(g) Unless a Lender shall have notified Canadian Agent prior to the date
of any Canadian Advance that it will not make available its Specified Percentage
of any Canadian Advance, Canadian Agent may assume that such Lender has made the
appropriate amount available in accordance with SECTION 2.02(a), and Canadian
Agent may, in reliance upon such assumption, make available to CA Canada a
corresponding amount. If and to the extent any Lender shall not have made such
amount available to Canadian Agent, such Lender and Borrowers severally agree to
repay to Canadian Agent immediately on demand such corresponding amount together
with interest thereon, from the date such amount is made available to CA Canada
until the date such amount is repaid to Canadian Agent at the Canadian Prime
Rate.
(h) The failure by any Lender to make available its Specified Percentage
of any Advance hereunder shall not relieve any other Lender of its obligation,
if any, to make available its Specified Percentage of any Advance. In no event,
however, shall Agent or any Lender be responsible for the failure of any other
Lender to make available any portion of any Advance.
(i) Borrowers shall indemnify each Lender against any Consequential Loss
incurred by each Lender as a result of (i) any failure to fulfill, on or before
the date specified for the Advance, the conditions to the Advance set forth
herein or (ii) Borrowers' requesting that an Advance not be made on the date
specified in the Borrowing Notice.
2.03. EVIDENCE OF INDEBTEDNESS.
(a) The Advances made by each Lender shall be evidenced by a Note in the
amount of such Lender's Specified Percentage of the Domestic Commitment or the
Canadian Commitment, as the case may be, in effect on the Effective Date (as the
same may be modified pursuant to SECTION 9.04).
30
(b) Absent manifest error, Agent's, Canadian Agent's and each Lenders'
records shall be conclusive as to amounts owed Agent, Canadian Agent and each
such Lender under the Notes and this Agreement.
2.04. PREPAYMENTS.
(a) Parent or CA Canada may, upon at least three Business Days prior
written notice to Agent or Canadian Agent (as applicable) stating the proposed
date and aggregate principal amount of the prepayment, prepay the outstanding
principal amount of any Advances in whole or in part, together with accrued
interest to the date of such prepayment on the principal amount prepaid without
premium or penalty other than any Consequential Loss; PROVIDED, HOWEVER, that in
the case of a prepayment of a Base Advance, the notice of prepayment may be
given by telephone by 11:00 a.m. on the date of prepayment, and in the case of a
prepayment of a Canadian Prime Rate Advance or a U.S. Base Rate Advance, the
notice of prepayment may be given by CA Canada to the Canadian Agent by
telephone by 11:00 a.m. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ time, on the date of
prepayment. Each partial prepayment shall, in the case of LIBOR Advances, be in
an aggregate principal amount of not less than $1,000,000 or an integral
multiple of $100,000 in excess thereof, in the case of Base Advances, Canadian
Prime Rate Advances, or U.S. Base Rate Advances, be in an aggregate principal
amount of not less than $1,000,000 or an integral multiple of $100,000 in excess
thereof of the respective currencies in which the loans are made, and, in the
case of Bankers' Acceptances, be in the full principal amount of the Bankers'
Acceptance, in Canadian Dollars. If any notice of prepayment is given, the
principal amount stated therein, together with accrued interest on the amount
prepaid and the amount, if any, due under SECTION 2.11, shall be due and payable
on the date specified in such notice.
(b) If at any time the sum of the aggregate principal amount of all
outstanding Advances and Reimbursement Obligations exceeds the lesser of (i) the
Commitment and (ii) the Borrowing Base, Borrowers shall immediately prepay
Advances then outstanding in the aggregate amount equal to such excess, together
with accrued interest to the date of such prepayment on the principal amount
prepaid without premium or penalty other than any Consequential Loss. Any
prepayment of Advances pursuant to this SECTION 2.04(b) shall be applied on a
Pro Rata basis with respect to the amounts of Advances outstanding under the
Domestic Commitment and the Canadian Commitment. Each of the Agent and the
Canadian Agent shall determine the application of such prepayment in its
discretion.
(c) If at any time the sum of the aggregate principal amount of all
outstanding Domestic Advances and Reimbursement Obligations related to Domestic
Letters of Credit exceeds the Domestic Commitment, Parent shall immediately
prepay Domestic Advances then outstanding in the aggregate amount equal to such
excess, together with accrued interest to the date of such prepayment on the
principal amount prepaid without premium or penalty other than any Consequential
Loss. Any prepayment of Domestic Advances pursuant to this SECTION 2.04(c)
shall be applied to the Domestic Commitment, as the Agent shall determine it its
discretion.
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(d) If at any time the sum of the aggregate principal amount of all
outstanding Canadian Advances and Reimbursement Obligations related to Canadian
Letters of Credit exceeds the Canadian Commitment, CA Canada shall immediately
prepay Canadian Advances then outstanding in the aggregate amount equal to such
excess, together with accrued interest to the date of such prepayment on the
principal amount prepaid without premium or penalty other than any Consequential
Loss. Any prepayment of Canadian Advances pursuant to this Section 2.04(d)
shall be applied among the Types of Canadian Advances then outstanding in the
Canadian Agent's discretion.
(e) No prepayments of Advances made solely pursuant to this SECTION 2.04
shall cause the Commitment to be reduced, except as specifically provided in
SECTION 2.04(f) hereof.
(f) Parent shall reduce the Domestic Commitment and prepay the aggregate
principal amount of all outstanding Domestic Advances by the amount by which
ABN's portion of the Domestic Commitment is reduced pursuant to SECTION 2.17(a)
hereof. Once prepaid pursuant to this subsection, such amount may not be
reborrowed under the Domestic Commitment.
2.05. REPAYMENT. Borrowers shall repay to Agent and Canadian Agent for
the Ratable account of Lenders the outstanding principal amount of the Advances
on the Maturity Date. The principal amount of each LIBOR Advance or Bankers'
Acceptance is due and payable on the last day of the applicable Interest Period,
which principal payment may be made by means of a Refinancing Advance (subject
to the other provisions of this Agreement). If on the date of a reduction of
the Commitment pursuant to SECTION 2.10, the sum of the aggregate principal
amount of all Advances and Reimbursement Obligations outstanding on the date of
such reduction exceeds the Commitment as reduced, the outstanding principal of
all Advances equal to such excess shall be due and payable, which principal
payment may not be made by means of a Refinancing Advance. If pursuant to any
Senior Note Paper Parent is required to prepay or repay any amount evidenced by
a Senior Note (other than a scheduled, mandatory prepayment or repayment),
Parent shall, on the same date as the prepayment or repayment with respect to
such Senior Note, pay to Agent and Canadian Agent for the Ratable account of
Lenders an amount equal to such prepayment or repayment of such Senior Note,
which principal payment may not be made by means of a Refinancing Advance. Any
repayment of Advances pursuant to this SECTION 2.05 shall be applied on a Pro
Rata basis with respect to the amounts of Advances outstanding under the
Domestic Commitment and the Canadian Commitment. Each of the Agent and the
Canadian Agent shall determine the application of such prepayment in its
discretion.
2.06. INTEREST. Subject to SECTIONS 2.07 and 9.09, Borrowers shall pay
interest on the unpaid principal amount of each Advance from the date of such
Advance until such principal shall be paid in full, at the following rates per
annum:
(a) BASE RATE, CANADIAN PRIME RATE, AND U.S. BASE ADVANCES. Base
Rate, Canadian Prime Rate, and U.S. Base Rate Advances shall bear interest
at a rate per annum equal to the lesser of (i) the Base Rate, the U.S. Base
Rate, or the Canadian Prime Rate,
32
as the case may be, in effect from time to time and (ii) the Highest
Lawful Rate. If the amount of interest payable in respect of any
interest computation period is reduced to the Highest Lawful Rate
pursuant to the immediately preceding sentence and the amount of
interest payable in respect of any subsequent interest computation
period would be less than the Maximum Amount, then the amount of
interest payable in respect of such subsequent interest computation
period shall be automatically increased to the Maximum Amount; PROVIDED
that at no time shall the aggregate amount by which interest paid has
been increased pursuant to this sentence exceed the aggregate amount by
which interest has been reduced pursuant to the immediately preceding
sentence. Section 2.18 sets forth other interest rate options available
for CA Canada under the Canadian Commitment.
(b) LIBOR ADVANCES. LIBOR Advances shall bear interest at the rate
per annum equal to the LIBOR Rate applicable to such Advance, which at no
time shall exceed the Highest Lawful Rate.
(c) BANKERS' ACCEPTANCES. Bankers' Acceptances shall bear interest
in accordance with the provisions of Section 2.18.
(d) PAYMENT DATES. Accrued and unpaid interest on Base Advances,
Canadian Prime Rate Advances and U.S. Base Rate Advances shall be paid
quarterly in arrears on each Quarterly Date, on the date of any prepayment
or repayment of such Advance, and on the Maturity Date. Accrued and unpaid
interest in respect of each LIBOR Advance shall be paid on the last day of
the appropriate Interest Period and on the date of any prepayment or
repayment of such Advance; PROVIDED, HOWEVER, that if any Interest Period
for a LIBOR Advance exceeds three months, interest shall also be paid on
the date which falls three months after the beginning of such Interest
Period. Stamping fees on Bankers' Acceptances are payable upon acceptance.
2.07. DEFAULT INTEREST. During the continuation of any Event of
Default, Borrowers shall pay, on demand, interest (after as well as before
judgment to the extent permitted by Law) on the principal amount of all Advances
outstanding and on all other Obligations due and unpaid hereunder for each
Advance equal to the lesser of the (a) the Highest Lawful Rate and (b) a rate
per annum which is determined by increasing the greatest applicable interest
rate for each Type of Advance (whether or not in effect) by 4.00% per annum for
the principal amount of the Advances outstanding and at a rate per annum equal
to the Base Rate, U.S. Base Rate, or Canadian Prime Rate, as the case may be
(whether or not in effect) plus 4.00% for any other Obligations due hereunder.
2.08. CONTINUATION AND CONVERSION ELECTIONS FOR DOMESTIC ADVANCES.
(a) Parent may upon irrevocable written notice to Agent and subject to the
terms of this Agreement:
33
(i) elect to convert, on any Business Day, all or any portion of
outstanding Base Advances (in an aggregate amount not less than $500,000 or
an integral multiple of $100,000 in excess thereof) into LIBOR Advances; or
(ii) elect to convert at the end of any Interest Period therefor,
all or any portion of outstanding LIBOR Advances comprised in the same
Borrowing (in an aggregate amount not less than $500,000 or an integral
multiple of $100,000 in excess thereof) into Base Advances; or
(iii) elect to continue, at the end of any Interest Period
therefor, any LIBOR Advances;
PROVIDED, HOWEVER, that if the aggregate amount of outstanding LIBOR
Advances comprised in the same Borrowing shall have been reduced as a result of
any payment, prepayment or conversion of part thereof to an amount less than
$1,000,000, the LIBOR Advances comprised in such Borrowing shall automatically
convert into Base Advances at the end of each respective Interest Period.
(b) Parent shall deliver a notice of conversion or continuation (a
"CONVERSION OR CONTINUATION NOTICE"), in substantially the form of EXHIBIT E, to
Agent not later than 10:00 a.m. (i) three Business Days prior to the proposed
date of conversion or continuation, if the Advances or any portion thereof are
to be converted into or continued as LIBOR Advances; and (ii) not later than
10:00 a.m. on the Business Day of the proposed conversion, if the Advances or
any portion thereof are to be converted into Base Advances.
Each such Conversion or Continuation Notice shall be by telecopy or
telephone, promptly confirmed by letter, specifying therein:
(i) the proposed date of conversion or continuation;
(ii) the aggregate amount of Advances to be converted or
continued;
(iii) the nature of the proposed conversion or continuation; and
(iv) the duration of the applicable Interest Period.
(c) If, upon the expiration of any Interest Period applicable to LIBOR
Advances, Parent shall have failed to select a new Interest Period to be
applicable to such LIBOR Advances or if an Event of Default shall then have
occurred and be continuing, Parent shall be deemed to have elected to convert
such LIBOR Advances into Base Advances effective as of the expiration date of
such current Interest Period.
34
(d) Notwithstanding any other provision contained in this Agreement, after
giving effect to any conversion or continuation of any Advances, there shall not
be outstanding Advances with more than five different Interest Periods and no
Interest Period shall extend beyond the Maturity Date.
2.09. FEES.
(a) COMMITMENT FEE. Subject to SECTION 9.09, Borrowers shall pay to Agent
for the Ratable account of Domestic Lenders a commitment fee (determined for the
period ending on a Quarterly Date or the Maturity Date, as appropriate, and
beginning on the Effective Date (with respect to the initial calculation period)
or the preceding Quarterly Date) on the average daily amount of the difference
between (A) the Domestic Commitment and (B) the sum of all outstanding Domestic
Advances and Reimbursement Obligations with respect to Letters of Credit, at the
applicable rate per annum set forth in the table in the definition of Applicable
Margin, payable in arrears on each Quarterly Date and on the Maturity Date,
commencing with the first Quarterly Date after the Effective Date. Subject to
SECTION 9.09, Borrowers shall pay to Canadian Agent for the Ratable account of
Canadian Lenders a commitment fee (determined for the period ending on a
Quarterly Date or the Maturity Date, as appropriate, and beginning on the
Effective Date (with respect to the initial calculation period) or the preceding
Quarterly Date) on the average daily amount of the difference between (A) the
Canadian Commitment and (B) the sum of all outstanding Canadian Advances and
Reimbursement Obligations with respect to Canadian Letters of Credit, at the
applicable rate per annum set forth in the table in the definition of Applicable
Margin, payable in arrears on each Quarterly Date and on the Maturity Date,
commencing with the first Quarterly Date after the Effective Date.
(b) L/C ISSUANCE FEE. Subject to SECTION 9.09, Parent shall pay to Agent
for the sole account of Issuing Bank a fee at the rate of .125% of the undrawn
face amount of each Letter of Credit, payable in advance on the date of issuance
of such Letter of Credit.
(c) L/C COMMISSION FEE. Subject to SECTION 9.09, Parent shall pay to
Agent for the Ratable account of Domestic Lenders a fee on the average daily
undrawn amount of all Letters of Credit, at the rate per annum equal to
then-current Applicable Margin for LIBOR Advances, payable in arrears on each
Quarterly Date and on the Maturity Date, commencing with the first Quarterly
Date after the Effective Date.
(d) L/C ADMINISTRATION FEES. Subject to SECTION 9.09, Parent shall pay to
Agent for the sole account of Issuing Bank the standard charges assessed by
Issuing Bank in connection with the administration (including any drawings) and
amendment of Letters of Credit.
(e) CANADIAN L/C ISSUANCE FEE. Subject to ▇▇▇▇▇▇▇ ▇.▇▇, ▇▇ ▇▇▇▇▇▇ shall
pay to Canadian Agent for the sole account of Canadian Issuing Bank a fee at the
rate of .125% of the undrawn face amount of each Canadian Letter of Credit,
payable in advance on the date of issuance of such Canadian Letter of Credit.
35
(f) CANADIAN L/C COMMISSION FEE. Subject to ▇▇▇▇▇▇▇ ▇.▇▇, ▇▇ ▇▇▇▇▇▇ shall
pay to Canadian Agent for the Ratable account of Canadian Lenders a fee on the
average daily undrawn amount of all Canadian Letters of Credit, at the rate per
annum equal to then-current Applicable Margin for Bankers' Acceptances, payable
in arrears on each Quarterly Date and on the Maturity Date, commencing with the
first Quarterly Date after the Effective Date.
(g) CANADIAN L/C ADMINISTRATION FEES. Subject to ▇▇▇▇▇▇▇ ▇.▇▇, ▇▇ ▇▇▇▇▇▇
shall pay to Canadian Agent for the sole account of Canadian Issuing Bank the
standard charges assessed by Canadian Issuing Bank in connection with the
administration (including any drawings) and amendment of Canadian Letters of
Credit.
2.10. REDUCTION OF COMMITMENT.
(a) The Commitment terminates on the Maturity Date.
(b) Borrowers may from time to time, upon notice to Agent or Canadian
Agent, as the case may be, not later than 1:00 p.m., five Business Days in
advance, terminate in whole or reduce in part either the Domestic Commitment or
the Canadian Commitment; PROVIDED, HOWEVER, that Borrowers shall pay the accrued
interest and the Commitment Fee on the amount of such reduction and all amounts
due under SECTION 2.11, and any partial reduction shall be in an aggregate
amount which is an integral multiple of $5,000,000 of the respective currencies
in which the Commitment is denominated.
(c) To the extent the sum of the aggregate principal amount of outstanding
Advances and Reimbursement Obligations exceeds the Commitment after any
reduction thereof, Borrowers shall repay, on the date of such reduction, the
amount specified in SECTION 2.04(b). The Commitment shall be reduced by the
amount of any repayment required by the fourth sentence of SECTION 2.05. Once
reduced or terminated, the Commitment may not be increased or reinstated.
2.11. FUNDING LOSSES. Borrower may prepay the outstanding principal
balance of any Advance, in full at any time or in part from time to time,
PROVIDED, that as conditions precedent to Borrowers' right to make, and any
Lender's obligation to accept, any such prepayment: (a) Agent shall have
actually received from Parent at least five Business Days' prior written notice
of Parent's intent to prepay the LIBOR Advances, of the amount of principal
which will be prepaid and of the date on which the prepayment will be made; (b)
Canadian Agent shall have actually received from CA Canada at least five
Business Days' prior written notice of CA Canada's intent to prepay a Bankers'
Acceptance in whole and of the date on which the prepayment will be made;
36
(c) each prepayment of principal of LIBOR Advances shall be in the amount of
$1,000,000 or a larger integral multiple of $100,000 (unless the prepayment
retires the outstanding balance of outstanding Advances in full); (d) each
prepayment of a Bankers' Acceptance shall be in the full principal amount of
the Bankers' Acceptance expressed in Canadian Dollars; (e) each prepayment of
Canadian Prime Rate Advances, U.S. Base Rate Advances, or Base Rate Advances
of principal shall be in the amount of $1,000,000 or a larger integral
multiple of $100,000, expressed in Dollars with respect to Base Advances and
U.S. Base Rate Advances and expressed in Canadian Dollars with respect to
Canadian Prime Rate Advances (unless the prepayment retires the outstanding
balance of outstanding Advances in full); and (f) each such prepayment shall
be in the amount of 100% of the principal amount to be prepaid, plus accrued
unpaid interest thereon to the date of prepayment, plus any other sums which
have become due to Agent, Canadian Agent and Lenders under the Loan Papers on
or before the prepayment date but have not been paid, and (subject to SECTION
9.09) any Consequential Loss. A certificate of each Lender setting forth the
basis for the determination of the amount of the Consequential Loss shall be
delivered to Borrowers and shall be conclusive in the absence of manifest
error.
Borrowers agree that each Lender is not obligated to actually reinvest the
amount prepaid in any specific obligation as a condition to receiving any
Consequential Loss, or otherwise.
2.12. COMPUTATIONS AND MANNER OF PAYMENTS.
(a) Parent shall make each payment hereunder and under the other Loan
Papers not later than 1:00 p.m. on the day when due in same day funds to Agent,
for the Ratable account of Domestic Lenders unless otherwise specifically
provided herein, at Agent's office at NationsBank Plaza, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, for further credit to the account of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Building Products, Inc. No later than the end of each day when each payment
hereunder is made, Parent shall notify ▇▇. ▇▇▇ ▇▇▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇, or such
other Person as Agent may from time to time specify.
(b) Unless Agent shall have received notice from Parent prior to the date
on which any payment is due hereunder that Parent will not make payment in full,
Agent may assume that such payment is so made on such date and may, in reliance
upon such assumption, make distributions to Domestic Lenders. If and to the
extent Parent shall not have made such payment in full, each Domestic Lender
shall repay to Agent forthwith on demand the applicable amount distributed,
together with interest thereon at the Federal Funds Rate, from the date of
distribution until the date of repayment. Borrowers hereby authorize each
Lender, if and to the extent payment is not made when due hereunder, to charge
the amount so due against any account of either of Borrowers with such Lender.
(c) CA Canada shall make each payment hereunder and under the other Loan
Papers not later than 1:00 p.m. on the day when due in same day funds to
Canadian Agent, for the Ratable account of Canadian Lenders unless otherwise
specifically provided herein, at Canadian Agent's office at the Canadian
Imperial Bank of Commerce, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇., ▇▇▇ ▇▇▇▇▇,
▇▇
▇▇▇▇▇▇▇, ▇▇, ▇▇▇ ▇▇▇, for further credit to the account of ▇▇▇▇▇▇▇
▇▇▇▇▇▇-Canada, Inc. No later than the end of each day when each payment
hereunder is made, CA Canada shall notify ▇▇▇▇▇ ▇▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇, or
such other Person as Canadian Agent may from time to time specify.
(d) Unless Canadian Agent shall have received notice from CA Canada prior
to the date on which any payment is due hereunder that CA Canada will not make
payment in full, Canadian Agent may assume that such payment is so made on such
date and may, in reliance upon such assumption, make distributions to Canadian
Lenders. If and to the extent CA Canada shall not have made such payment in
full, each Canadian Lender shall repay to Canadian Agent forthwith on demand the
applicable amount distributed, together with interest thereon at the Canadian
Prime Rate, from the date of distribution until the date of repayment.
Borrowers hereby authorize each Lender, if and to the extent payment is not made
when due hereunder, to charge the amount so due against any account of either of
Borrowers with such Lender.
(e) Subject to SECTION 2.18 and SECTION 9.09, interest on LIBOR Advances,
Base Advances, the Commitment Fee, each other fee, and other amounts due under
the Loan Papers shall be calculated on the basis of actual days elapsed but
computed as if each year consisted of 360 days. Such computations shall be made
including the first day but excluding the last day occurring in the period for
which such interest, payment, Commitment Fee, or other fee is payable. Each
determination by Agent, Canadian Agent, or a Lender of an interest rate, fee or
commission hereunder shall be conclusive and binding for all purposes, absent
manifest error. All payments under the Loan Papers shall be made in Dollars
with respect to Domestic Advances, U.S. Base Rate Advances, and Reimbursement
Obligations related thereto, and in Canadian Dollars with respect to Canadian
Prime Rate Advances, Bankers' Acceptances, and Reimbursement Obligations related
thereto, and without setoff, counterclaim, or other defense.
(f) Whenever any payment to be made hereunder or under any other Loan
Papers shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall be included in the computation of interest or fees, if applicable;
PROVIDED, HOWEVER, if such extension would cause payment of interest on or
principal of LIBOR Advances or Bankers' Acceptances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(g) Reference to any particular index or reference rate for determining
any applicable interest rate under this Agreement is for purposes of calculating
the interest due and is not intended as and shall not be construed as requiring
any Lender to actually obtain funds for any Advance at any particular index or
reference rate.
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2.13. YIELD PROTECTION; CHANGED CIRCUMSTANCES.
(a) If any Lender determines that either (i) the adoption, after the date
hereof, of any Applicable Law, rule, regulation or guideline regarding capital
adequacy and applicable to commercial banks or financial institutions generally
or any change therein, or any change, after the date hereof, in the
interpretation or administration thereof by any Tribunal, central bank or
comparable agency charged with the interpretation or administration thereof, or
(ii) compliance by any Lender (or Lending Office of any Lender) with any request
or directive made after the date hereof applicable to commercial banks or
financial institutions generally regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency has the effect of reducing the rate of return on such Lender's capital as
a consequence of its obligations hereunder to a level below that which such
Lender could have achieved but for such adoption, change or compliance (taking
into consideration such Lender's policies with respect to capital adequacy [but
excluding consequences of such Lender's negligence or intentional disregard of
law or regulation]) by an amount reasonably deemed by such Lender to be
material, then from time to time, within fifteen days after demand by such
Lender, Borrowers shall pay to such Lender such additional amount or amounts as
will adequately compensate such Lender for such reduction. Each Lender will
notify Borrowers of any event occurring after the date of this Agreement which
will entitle such Lender to compensation pursuant to this SECTION 2.13(a) as
promptly as practicable after such Lender obtains actual knowledge of such
event; PROVIDED, no Lender shall be liable for its failure or the failure of any
other Lender to provide such notification. A certificate of such Lender
claiming compensation under this SECTION 2.13(a), setting forth in reasonable
detail the calculation of the additional amount or amounts to be paid to it
hereunder and certifying that such claim is consistent with such Lender's
treatment of similar customers having similar provisions generally in their
agreements with such Lender shall be conclusive in the absence of manifest
error. Each Lender shall use reasonable efforts to mitigate the effect upon
Borrowers of any such increased costs payable to such Lender under this SECTION
2.13(a).
(b) If, after the date hereof, any Tribunal, central bank or other
comparable authority, at any time imposes, modifies or deems applicable any
reserve (including, without limitation, any imposed by the Board of Governors of
the Federal Reserve System or the Bank of Canada), special deposit or similar
requirement against assets of, deposits with or for the amount of, or credit
extended by, any Lender, or imposes on any Lender any other condition affecting
a LIBOR Advance or a Bankers' Acceptance, the Notes, or its obligation to make a
LIBOR Advance or a Bankers' Acceptance; and the result of any of the foregoing
is to increase the cost to such Lender of making or maintaining its LIBOR
Advances, or a Bankers' Acceptance or to reduce the amount of any sum received
or receivable by such Lender under this Agreement or under the Notes by an
amount deemed by such Lender, to be material, THEN, within five days after
demand by such Lender, Parent shall pay to such Lender such additional amount or
amounts as will compensate such Lender for such increased cost or reduction.
Each Lender will (i) notify Parent or CA Canada, as the case may be, of any
event occurring after the date of this Agreement that entitles such Lender to
compensation pursuant to this SECTION 2.13(b), as promptly as practicable after
39
such Lender obtains actual knowledge of the event; PROVIDED, no Lender shall be
liable for its failure or the failure of any other Lender to provide such
notification and (ii) use good faith and reasonable efforts to designate a
different Lending Office for LIBOR Advances or Bankers' Acceptances of such
Lender if the designation will avoid the need for, or reduce the amount of, the
compensation and will not, in the sole opinion of such Lender, be
disadvantageous to such Lender. A certificate of such Lender claiming
compensation under this SECTION 2.13(b), setting forth in reasonable detail the
computation of the additional amount or amounts to be paid to it hereunder and
certifying that such claim is consistent with such Lender's treatment of similar
customers having similar provisions generally in their agreements with such
Lender shall be conclusive in the absence of manifest error. If such Lender
demands compensation under this SECTION 2.13(b), Parent or CA Canada, as the
case may be, may at any time, on at least five Business Days' prior notice to
such Lender (i) repay in full the then outstanding principal amount of LIBOR
Advances, of such Lender, together with accrued interest thereon, (ii) convert
the LIBOR Advances to Base Advances in accordance with the provisions of this
Agreement, or (iii) convert the Bankers' Acceptances to either Canadian Prime
Rate Advances or U.S. Base Rate Advances in accordance with the provisions of
this Agreement; PROVIDED, HOWEVER, that Parent or CA Canada, as the case may be,
shall be liable for the Consequential Loss arising pursuant to those actions.
(c) Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation or administration of
any Law shall make it unlawful, or any central bank or other Tribunal shall
assert that it is unlawful, for a Lender to perform its obligations hereunder to
make LIBOR Advances or to accept Bankers' Acceptances or to continue to fund or
maintain LIBOR Advances or Bankers' Acceptances hereunder, then, on notice
thereof and demand therefor by such Lender to Parent or CA Canada, as the case
may be, (i) each LIBOR Advance will automatically, upon such demand, convert
into a Base Advance, (ii) each Bankers' Acceptance will automatically, upon such
demand, convert into a Canadian Prime Rate Advance, and (iii) the obligation of
such Lender to make, or to convert Advances into, LIBOR Advances or Bankers'
Acceptances shall be suspended until such Lender notifies Agent or Canadian
Agent, as the case may be, and Parent or CA Canada, as the case may be, that
such Lender has determined that the circumstances causing such suspension no
longer exist.
(d) Upon the occurrence and during the continuance of any Default or Event
of Default, (i) each LIBOR Advance will automatically, on the last day of the
then existing Interest Period therefor, convert into a Base Advance and (ii) the
obligation of each Lender to make, or to convert Advances into, LIBOR Advances
shall be suspended.
(e) Failure on the part of any Lender to demand compensation for any
increased costs, increased capital or reduction in amounts received or
receivable or reduction in return on capital pursuant to this SECTION 2.13 with
respect to any period shall not constitute a waiver of any Lender's right to
demand compensation with respect to such period or any other period, subject,
however, to the limitations set forth in this SECTION 2.13.
40
(f) The obligations of Borrowers under this SECTION 2.13 shall survive any
termination of this Agreement.
(g) Determinations by Lenders for purposes of this SECTION 2.13 shall be
conclusive, absent manifest error. Any certificate delivered to Borrowers by a
Lender pursuant to this SECTION 2.13 shall include in reasonable detail the
basis for such Lender's demand for additional compensation and a certification
that the claim for compensation is consistent with such Lender's treatment of
similar customers having similar provisions generally in their agreements with
such Lender.
(h) Notwithstanding any other provision of this Agreement, Lenders not
organized under the Laws of the United States or any State shall be entitled to
compensation pursuant to this SECTION 2.13 with respect to any amount which
would otherwise be due under this SECTION 2.13 but which is the result of an act
of a Tribunal of the country in which such Lender is organized.
2.14. USE OF PROCEEDS.
(a) The proceeds of the Domestic Advances shall be available (and Parent
shall use such proceeds) solely to provide working capital to Parent, for
general corporate purposes, for the issuance of Letters of Credit and for
Permitted Acquisitions.
(b) The proceeds of the Canadian Advances shall be available (and CA
Canada shall use such proceeds) solely to provide working capital to CA Canada,
for general corporate purposes, for the issuance of Canadian Letters of Credit,
for the acquisition of assets of ▇▇▇▇ Distributors, a division of Ince Holdings
Ltd., and for Permitted Acquisitions.
(c) No Letter of Credit or Canadian Letter of Credit shall be issued for
the account of or otherwise used for the benefit of CAFS and no proceeds of any
Advance shall be advanced to CAFS; PROVIDED, Parent may use proceeds of Domestic
Advances not to exceed in the aggregate $3,000,000 to acquire capital stock of
CAFS.
2.15. LETTERS OF CREDIT.
(a) THE LETTER OF CREDIT FACILITY. Parent may request Issuing Bank, on
the terms and conditions hereinafter set forth, to issue, and Issuing Bank
shall, if so requested, issue, letters of credit (the "LETTERS OF CREDIT") for
the account of Parent from time to time on any Business Day from the Effective
Date until the Maturity Date in an aggregate maximum amount (assuming compliance
with all conditions to drawing) not to exceed at any time outstanding the lesser
of (the "LETTER OF CREDIT FACILITY") (i) $5,000,000 and (ii) the Domestic
Commitment MINUS the sum of (A) the aggregate principal amount of Domestic
Advances then outstanding and (B) all Reimbursement Obligations with respect to
Domestic Letters of Credit. The Letter of Credit Facility is a subfacility of
the Domestic Commitment and is not an amount in addition to the Domestic
Commitment. No Letter of Credit shall have an expiration (including all rights
of
41
renewal) later than the earlier of eighteen months from the date of issuance
of the Letter of Credit and the Maturity Date. Immediately upon the issuance of
each Letter of Credit, Issuing Bank shall be deemed to have sold and transferred
to each Domestic Lender, and each Domestic Lender shall be deemed to have
purchased and received from Issuing Bank, in each case irrevocably and without
any further action by any party, an undivided interest and participation in such
Letter of Credit, each drawing thereunder and the obligations of Parent under
this Agreement in respect thereof in an amount equal to the product of such
Lender's Specified Percentage of the Domestic Commitment times the maximum
amount available to be drawn under such Letter of Credit (assuming compliance
with all conditions to drawing). Within the limits of the Letter of Credit
Facility, and subject to the limits referred to above, Parent may request the
issuance of Letters of Credit under this SECTION 2.15(a), repay any Advances
resulting from drawings thereunder pursuant to SECTION 2.15(c), and request the
issuance of additional Letters of Credit under this SECTION 2.15(a).
(b) REQUEST FOR ISSUANCE. Each Letter of Credit shall be issued upon
notice, given not later than 11:00 a.m. on the third Business Day prior to the
date of the proposed issuance of such Letter of Credit, by Parent to Issuing
Bank, which shall give to Agent and each Lender prompt notice thereof by telex,
telecopier, or cable. Each Letter of Credit shall be issued upon notice given
in accordance with the terms of any separate agreement between Parent and
Issuing Bank in form and substance reasonably satisfactory to Parent and Issuing
Bank providing for the issuance of Letters of Credit pursuant to this Agreement
and containing terms and conditions not inconsistent with this Agreement (a
"LETTER OF CREDIT AGREEMENT"); PROVIDED, that if any such terms and conditions
are inconsistent with this Agreement, this Agreement shall control. Each such
notice of issuance of a Letter of Credit (a "NOTICE OF ISSUANCE") shall be by
telex, telecopier, or cable, specifying therein (i) the requested date of such
issuance (which shall be a Business Day), (ii) the maximum amount of such Letter
of Credit, (iii) the expiry of such Letter of Credit, (iv) the name and address
of the beneficiary of such Letter of Credit, (v) the form of such Letter of
Credit, and (vi) such other information as shall be required pursuant to the
relevant Letter of Credit Agreement. If the requested terms of such Letter of
Credit are acceptable to Issuing Bank in its reasonable discretion, Issuing Bank
will, upon fulfillment of the applicable conditions set forth in ARTICLE III,
make such Letter of Credit available to Parent at its office referred to in
SECTION 9.02 or as otherwise agreed with Parent in connection with such
issuance.
(c) DRAWING AND REIMBURSEMENT. The payment by Issuing Bank of a draft
drawn under any Letter of Credit shall constitute for all purposes of this
Agreement the making by Issuing Bank of a Domestic Advance, which shall bear
interest at the applicable Base Rate, in the amount of such draft (but without
any requirement for compliance with the conditions set forth in ARTICLE III).
If a drawing under any Letter of Credit is not reimbursed by Parent by 11:00
a.m. on the first Business Day after such drawing, Issuing Bank shall promptly
notify Agent and each other Domestic Lender. Each such Domestic Lender shall,
on the first Business Day following such notification, make a Domestic Advance,
which shall bear interest at the applicable Base Rate, and shall be used to
repay the applicable portion of Issuing Bank's Domestic Advance with respect to
such Letter of Credit, in an amount equal to the amount of its participation in
such drawing for
42
application to reimburse Issuing Bank (but without any requirement for
compliance with the applicable conditions set forth in ARTICLE III) and shall
make available to Agent for the account of Issuing Bank, by deposit at
Agent's office, in same day funds, the amount of such Domestic Advance. In
the event that any Domestic Lender fails to make available to Agent for the
account of Issuing Bank the amount of such Domestic Advance, Issuing Bank
shall be entitled to recover such amount on demand from such Lender together
with interest thereon at a rate per annum equal to the lesser of (i) the
Highest Lawful Rate and (ii) the Federal Funds Rate plus 0.50%.
(d) INCREASED COSTS. If any change in any Law or in the interpretation
thereof by any Tribunal charged with the administration thereof shall either
(i) impose, modify, or deem applicable any reserve, special deposit or similar
requirement against letters of credit or guarantees issued by, or assets held
by, or deposits in or for the account of, Issuing Bank or any Domestic Lender or
(ii) impose on Issuing Bank or any Domestic Lender any other condition regarding
this Agreement or such Domestic Lender or any Letter of Credit, and the result
of any event referred to in the preceding CLAUSE (i) or (ii) shall be to
increase the cost to Issuing Bank of issuing or maintaining any Letter of Credit
or to any Domestic Lender of purchasing any participation therein or making any
Advance pursuant to SECTION 2.15(c), then, upon demand by Issuing Bank or such
Domestic Lender, Parent shall, subject to SECTION 9.09, pay to Issuing Bank or
such Domestic Lender, from time to time as specified by Issuing Bank or such
Domestic Lender, additional amounts that shall be sufficient to compensate
Issuing Bank or such Domestic Lender for such increased cost ("ADDITIONAL LETTER
OF CREDIT COSTS"). A certificate as to the amount of such Additional Letter of
Credit Costs, submitted to Parent by Issuing Bank or such Domestic Lender, shall
include in reasonable detail the basis for the demand for additional
compensation and shall be conclusive and binding for all purposes, absent
manifest error. Notwithstanding any other provision of this Agreement, no
Domestic Lender not organized under the Laws of the United States or any State
shall be entitled to compensation pursuant to this SECTION 2.15(d) with respect
to any amount which would otherwise be due under this SECTION 2.15(d) but which
is the result of an act of a Tribunal of the country in which such Lender is
organized.
(e) OBLIGATIONS ABSOLUTE. The obligations of Parent under this Agreement
with respect to any Letter of Credit, any Letter of Credit Agreement, and any
other agreement or instrument relating to any Letter of Credit or any Advance
pursuant to SECTION 2.15(c) shall be unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement, such Letter of
Credit Agreement, and such other agreement or instrument under all
circumstances, including, without limitation, the following circumstances:
(i) any lack of validity or enforceability of this Agreement,
any other Loan Paper, any Letter of Credit Agreement, any Letter of Credit,
or any other agreement or instrument relating thereto (collectively, the
"L/C RELATED DOCUMENTS");
(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 Parent in respect of
the Letters of Credit or
43
any Advance pursuant to SECTION 2.15(c) 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 Parent may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), Issuing Bank, any Lender
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 statement or any other document presented under a 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;
(v) payment by Issuing Bank under a Letter of Credit against
presentation of a draft or certificate that does not comply with the terms
of the Letter of Credit, except for any payment made upon Issuing Bank's
gross negligence or willful misconduct;
(vi) any exchange, release, or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
guarantee, for all or any of the Obligations of Parent or any other Obligor
in respect of the Letters of Credit or any Advance pursuant to
SECTION 2.15(c); or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including, without
limitation, any other circumstance that might otherwise constitute a
defense available to, or a discharge of, Parent or any other Obligor, other
than Issuing Bank's gross negligence or willful misconduct.
(f) L/C CASH COLLATERAL ACCOUNT.
(i) Upon the occurrence of an Event of Default and written
demand by Agent or Issuing Bank, Parent will promptly pay to Agent in
immediately available funds an amount equal to 100% of the maximum amount
then available to be drawn under the Letters of Credit then outstanding.
Any amounts so received by Agent shall be deposited by Agent in a deposit
account maintained by Issuing Bank (the "L/C CASH COLLATERAL ACCOUNT").
(ii) As security for the payment of all Reimbursement Obligations
and for any other Obligations, upon an Event of Default without notice or
demand, Parent hereby grants, conveys, assigns, pledges, sets over, and
transfers to Agent (for the benefit of Issuing Bank and Domestic Lenders),
and creates in Agent's favor (for the benefit of Issuing Bank and Domestic
Lenders) a security interest and pledge in, all money,
44
instruments, and securities at any time held in or acquired in connection
with the L/C Cash Collateral Account, together with all proceeds thereof.
The L/C Cash Collateral Account shall be under the sole dominion and
control of Agent and Parent shall have no right to withdraw or to cause
Agent to withdraw any funds deposited in the L/C Cash Collateral Account.
At any time and from time to time, upon Agent's request, Parent promptly
shall execute and deliver any and all such further instruments, and
documents, including without limitation, U.C.C. financing statements, as
may be necessary, appropriate or desirable in Agent's judgment to obtain
the full benefits (including perfection and priority) of the security
interest created or intended to be created by this SECTION 2.15(f)(ii) and
of the rights and powers herein granted. Parent shall not create or suffer
to exist any Lien on any amounts or investments held in the L/C Cash
Collateral Account other than the Lien granted under this
SECTION 2.15(f)(ii).
(iii) Agent shall (A) apply any funds in the L/C Cash
Collateral Account on account of Reimbursement Obligations when the same
become due and payable if and to the extent that Parent shall fail directly
to pay such Reimbursement Obligations and (B) after the Maturity Date,
apply any proceeds remaining in the L/C Cash Collateral Account FIRST to
pay any unpaid Obligations relating to the Domestic Commitment THEN
outstanding hereunder and THEN to refund any remaining amount to Parent.
(iv) Parent, no more than once in any calendar month, may direct
Agent to invest the funds held in the L/C Cash Collateral Account (so long
as the aggregate amount of such funds exceeds any relevant minimum
investment requirement) in (A) direct obligations of the United States or
any agency thereof, or obligations guaranteed by the United States or any
agency thereof and (B) one or more other types of investments permitted by
Determining Lenders, in each case with such maturities as Parent, with the
consent of Determining Lenders, may specify, pending application of such
funds on account of Reimbursement Obligations or on account of other
Obligations, as the case may be. In the absence of any such direction from
Parent, Agent shall invest the funds held in the L/C Cash Collateral
Account (so long as the aggregate amount of such funds exceeds any relevant
minimum investment requirement) in one or more types of investments with
the consent of Determining Lenders with such maturities as Agent, with the
consent of Determining Lenders, may specify, pending application of such
funds on account of Reimbursement Obligations or on account of other
Obligations, as the case may be. All such investments shall be made in
Agent's name for the account of Issuing Bank and Domestic Lenders. PARENT
RECOGNIZES THAT ANY LOSSES OR TAXES WITH RESPECT TO SUCH INVESTMENTS SHALL
BE BORNE SOLELY BY PARENT, AND PARENT AGREES TO HOLD AGENT, ISSUING BANK,
AND LENDERS HARMLESS FROM ANY AND ALL SUCH LOSSES AND TAXES. Agent may
liquidate any investment held in the L/C Cash Collateral Account in order
to apply the proceeds of such investment on account of the Reimbursement
Obligations (or on account of any other Obligations then due and payable,
as the case may be) in accordance with SECTION 2.15(f)(iii) without regard
to whether such investment has matured and without
45
liability for any penalty or other fee incurred (with respect to which
Parent hereby agrees to reimburse Agent) as a result of such application.
(v) Parent shall pay to Agent the fees customarily charged by
Issuing Bank with respect to the maintenance of accounts similar to the L/C
Cash Collateral Account.
(g) NO LIABILITY OF ISSUING BANK. Parent assumes all risks of the acts or
omissions of any beneficiary or transferee of any Letter of Credit with respect
to its use of such Letter of Credit. None of Agent, Issuing Bank, or any
Lender, or any of their respective officers or directors shall be liable or
responsible for: (a) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith;
(b) the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by Issuing Bank against
presentation of documents that do not comply with the terms of a Letter of
Credit, including failure of any documents to bear any reference or adequate
reference to the Letter of Credit, except for any payment made upon Issuing
Bank's gross negligence or willful misconduct; or (d) any other circumstances
whatsoever in making or failing to make payment under any Letter of Credit,
except that Parent shall have a claim against Issuing Bank, and Issuing Bank
shall be liable to Parent, to the extent of any direct, but not consequential,
damages suffered by Parent that Parent proves were caused by (i) Issuing Bank's
willful misconduct or gross negligence in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, 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.
(h) BORROWING BASE. Notwithstanding anything contained in this SECTION
2.15 or SECTION 2.16, in no event shall the Reimbursement Obligations
outstanding under the Letter of Credit Facility and the Canadian Letter of
Credit Facility exceed the Borrowing Base.
2.16. CANADIAN LETTERS OF CREDIT.
(a) THE CANADIAN LETTER OF CREDIT FACILITY. CA Canada may request
Canadian Issuing Bank, on the terms and conditions hereinafter set forth, to
issue, and Canadian Issuing Bank shall, if so requested, issue, letters of
credit (the "CANADIAN LETTERS OF CREDIT") for the account of CA Canada from time
to time on any Business Day from the Effective Date until the Maturity Date in
an aggregate maximum amount (assuming compliance with all conditions to drawing)
not to exceed at any time outstanding the lesser of (the "CANADIAN LETTER OF
CREDIT FACILITY") (i) CDN$2,000,000, and (ii) the Canadian Commitment MINUS the
sum of (A) the aggregate principal amount of Canadian Advances then outstanding
and (B) all Reimbursement Obligations with respect to Canadian Letters of
Credit. The Canadian Letters of Credit shall be in the standard
46
form of the Canadian Issuing Bank. The Canadian Letter of Credit Facility is
a subfacility of the Canadian Commitment and is not an amount in addition to
the Canadian Commitment. No Canadian Letter of Credit shall have an
expiration (including all rights of renewal) later than the earlier of
eighteen months from the date of issuance of the Canadian Letter of Credit
and the Maturity Date. Immediately upon the issuance of each Canadian Letter
of Credit, Canadian Issuing Bank shall be deemed to have sold and transferred
to each Canadian Lender, and each Canadian Lender shall be deemed to have
purchased and received from Canadian Issuing Bank, in each case irrevocably
and without any further action by any party, an undivided interest and
participation in such Canadian Letter of Credit, each drawing thereunder and
the obligations of CA Canada under this Agreement in respect thereof in an
amount equal to the product of such Canadian Lender's Specified Percentage of
the Canadian Commitment times the maximum amount available to be drawn under
such Canadian Letter of Credit (assuming compliance with all conditions to
drawing). Within the limits of the Canadian Letter of Credit Facility, and
subject to the limits referred to above, CA Canada may request the issuance
of Canadian Letters of Credit under this SECTION 2.16(a), repay any Advances
resulting from drawings thereunder pursuant to SECTION 2.16(c), and request
the issuance of additional Canadian Letters of Credit under this SECTION
2.16(a).
(b) REQUEST FOR ISSUANCE. Each Canadian Letter of Credit shall be issued
upon notice, given not later than 11:00 a.m. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ time on
the third Business Day prior to the date of the proposed issuance of such
Canadian Letter of Credit, by CA Canada to Canadian Issuing Bank, which shall
give to Canadian Agent and each Canadian Lender prompt notice thereof by telex,
telecopier, or cable. Each Canadian Letter of Credit shall be issued upon
notice given in accordance with the terms of any separate agreement between CA
Canada and Canadian Issuing Bank in form and substance reasonably satisfactory
to CA Canada and Canadian Issuing Bank providing for the issuance of Canadian
Letters of Credit pursuant to this Agreement and containing terms and conditions
not inconsistent with this Agreement (a "CANADIAN LETTER OF CREDIT AGREEMENT");
PROVIDED, that if any such terms and conditions are inconsistent with this
Agreement, this Agreement shall control. Each such notice of issuance of a
Canadian Letter of Credit (a "NOTICE OF ISSUANCE") shall be by telex,
telecopier, or cable, specifying therein (i) the requested date of such issuance
(which shall be a Business Day), (ii) the maximum amount of such Canadian Letter
of Credit, (iii) the expiry of such Canadian Letter of Credit, (iv) the name and
address of the beneficiary of such Canadian Letter of Credit, (v) the form of
such Canadian Letter of Credit, and (vi) such other information as shall be
required pursuant to the relevant Canadian Letter of Credit Agreement. If the
requested terms of such Canadian Letter of Credit are acceptable to Canadian
Issuing Bank in its reasonable discretion, Canadian Issuing Bank will, upon
fulfillment of the applicable conditions set forth in ARTICLE III, make such the
Canadian Letter of Credit available to CA Canada at its office referred to in
SECTION 9.02 or as otherwise agreed with CA Canada in connection with such
issuance.
(c) DRAWING AND REIMBURSEMENT. The payment by Canadian Issuing Bank of a
draft drawn under any Canadian Letter of Credit shall constitute for all
purposes of this Agreement the making by Canadian Issuing Bank of a Canadian
Advance, which shall bear interest at the
47
applicable Canadian Prime Rate, in the amount of such draft (but without any
requirement for compliance with the conditions set forth in ARTICLE III). If
a drawing under any Canadian Letter of Credit is not reimbursed by CA Canada
by 11:00 a.m. Calgary, Alberta, Canada time on the first Business Day after
such drawing, Canadian Issuing Bank shall promptly notify Canadian Agent and
each other Canadian Lender. Each such Canadian Lender shall, on the first
Business Day following such notification, make a Canadian Advance, which
shall bear interest at the applicable Canadian Prime Rate, and shall be used
to repay the applicable portion of Canadian Issuing Bank's Canadian Advance
with respect to such Canadian Letter of Credit, in an amount equal to the
amount of its participation in such drawing for application to reimburse
Canadian Issuing Bank (but without any requirement for compliance with the
applicable conditions set forth in ARTICLE III) and shall make available to
Canadian Agent for the account of Canadian Issuing Bank, by deposit at
Canadian Agent's office, in same day funds, the amount of such Canadian
Advance. In the event that any Canadian Lender fails to make available to
Canadian Agent for the account of Canadian Issuing Bank the amount of such
Canadian Advance, Canadian Issuing Bank shall be entitled to recover such
amount on demand from such Canadian Lender together with interest thereon at
a rate per annum equal to the lesser of (i) the Highest Lawful Rate and (ii)
the Canadian Prime Rate.
(d) INCREASED COSTS. If any change in any Law or in the interpretation
thereof by any Tribunal charged with the administration thereof shall either
(i) impose, modify, or deem applicable any reserve, special deposit or similar
requirement against letters of credit or guarantees issued by, or assets held
by, or deposits in or for the account of, Canadian Issuing Bank or any Canadian
Lender or (ii) impose on Canadian Issuing Bank or any Canadian Lender any other
condition regarding this Agreement or such Canadian Lender or any Canadian
Letter of Credit, and the result of any event referred to in the preceding
CLAUSE (i) or (ii) shall be to increase the cost to Canadian Issuing Bank of
issuing or maintaining any Canadian Letter of Credit or to any Canadian Lender
of purchasing any participation therein or making any Advance pursuant to
SECTION 2.16(c), then, upon demand by Canadian Issuing Bank or such Canadian
Lender, CA Canada shall, subject to SECTION 9.09, pay to Canadian Issuing Bank
or such Canadian Lender, from time to time as specified by Canadian Issuing Bank
or such Canadian Lender, additional amounts that shall be sufficient to
compensate Canadian Issuing Bank or such Canadian Lender for such increased cost
("ADDITIONAL CANADIAN LETTER OF CREDIT COSTS"). A certificate as to the amount
of such Additional Canadian Letter of Credit Costs, submitted to CA Canada by
Canadian Issuing Bank or such Canadian Lender, shall include in reasonable
detail the basis for the demand for additional compensation and shall be
conclusive and binding for all purposes, absent manifest error. Notwithstanding
any other provision of this Agreement, no Canadian Lender not organized under
the Laws of the Canada or any Province therein shall be entitled to compensation
pursuant to this SECTION 2.16(d) with respect to any amount which would
otherwise be due under this SECTION 2.16(d) but which is the result of an act of
a Tribunal of the country in which such Lender is organized.
(e) OBLIGATIONS ABSOLUTE. The obligations of CA Canada under this
Agreement with respect to any Canadian Letter of Credit, any Canadian Letter of
Credit Agreement, and any other
48
agreement or instrument relating to any Canadian Letter of Credit or any
Advance pursuant to SECTION 2.16(c) shall be unconditional and irrevocable,
and shall be paid strictly in accordance with the terms of this Agreement,
such Canadian Letter of Credit Agreement, and such other agreement or
instrument under all circumstances, including, without limitation, the
following circumstances:
(i) any lack of validity or enforceability of this Agreement,
any other Loan Paper, any Canadian Letter of Credit Agreement, any Canadian
Letter of Credit, or any other agreement or instrument relating thereto
(collectively, the "CANADIAN L/C RELATED DOCUMENTS");
(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 CA Canada in respect
of the Canadian Letters of Credit or any Advance pursuant to
SECTION 2.16(c) or any other amendment or waiver of or any consent to
departure from all or any of the Canadian L/C Related Documents;
(iii) the existence of any claim, set-off, defense, or other
right that CA Canada may have at any time against any beneficiary or any
transferee of a Canadian Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), Canadian Issuing Bank,
any Lender or any other Person, whether in connection with this Agreement,
the transactions contemplated hereby or by the Canadian L/C Related
Documents or any unrelated transaction;
(iv) any statement or any other document presented under a
Canadian 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;
(v) payment by Canadian Issuing Bank under a Canadian Letter of
Credit against presentation of a draft or certificate that does not comply
with the terms of the Canadian Letter of Credit, except for any payment
made upon Canadian Issuing Bank's gross negligence or willful misconduct;
(vi) any exchange, release, or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
guarantee, for all or any of the Obligations of CA Canada or any other
Obligor in respect of the Canadian Letters of Credit or any Advance
pursuant to SECTION 2.16(c); or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including, without limitation, any
other circumstance that might otherwise constitute a defense available to,
or a discharge of, CA Canada or any other Obligor, other than Canadian
Issuing Bank's gross negligence or willful misconduct.
49
(f) CANADIAN L/C CASH COLLATERAL ACCOUNT.
(i) Upon the occurrence of an Event of Default and written
demand by Canadian Agent or Canadian Issuing Bank, CA Canada will promptly
pay to Canadian Agent in immediately available funds an amount equal to
100% of the maximum amount then available to be drawn under the Canadian
Letters of Credit then outstanding. Any amounts so received by Canadian
Agent shall be deposited by Canadian Agent in a deposit account maintained
by Canadian Issuing Bank (the "CANADIAN L/C CASH COLLATERAL ACCOUNT").
(ii) As security for the payment of all Reimbursement Obligations
and for any other Obligations, upon an Event of Default without notice or
demand, CA Canada hereby grants, conveys, assigns, pledges, sets over, and
transfers to Canadian Agent (for the benefit of Canadian Issuing Bank and
Canadian Lenders), and creates in Canadian Agent's favor (for the benefit
of Canadian Issuing Bank and Canadian Lenders) a security interest and
pledge in, all money, instruments, and securities at any time held in or
acquired in connection with the Canadian L/C Cash Collateral Account,
together with all proceeds thereof. The Canadian L/C Cash Collateral
Account shall be under the sole dominion and control of Canadian Agent and
CA Canada shall have no right to withdraw or to cause Canadian Agent to
withdraw any funds deposited in the Canadian L/C Cash Collateral Account.
At any time and from time to time, upon Canadian Agent's request, CA Canada
promptly shall execute and deliver any and all such further instruments and
documents, as may be necessary, appropriate or desirable in Canadian
Agent's judgment to obtain the full benefits (including perfection and
priority) of the security interest created or intended to be created by
this SECTION 2.16(f)(ii) and of the rights and powers herein granted. CA
Canada shall not create or suffer to exist any Lien on any amounts or
investments held in the Canadian L/C Cash Collateral Account other than the
Lien granted under this SECTION 2.16(f)(ii).
(iii) Canadian Agent shall (A) apply any funds in the
Canadian L/C Cash Collateral Account on account of Reimbursement
Obligations when the same become due and payable if and to the extent that
CA Canada shall fail directly to pay such Reimbursement Obligations and
(B) after the Maturity Date, apply any proceeds remaining in the Canadian
L/C Cash Collateral Account FIRST to pay any unpaid Obligations relating to
the Canadian Commitment then outstanding hereunder and THEN to refund any
remaining amount to CA Canada.
(iv) CA Canada, no more than once in any calendar month, may
direct Canadian Agent to invest the funds held in the Canadian L/C Cash
Collateral Account (so long as the aggregate amount of such funds exceeds
any relevant minimum investment requirement) in (A) direct obligations of
Canada or any agency thereof, or obligations guaranteed by Canada or any
agency thereof and (B) one or more other types of investments permitted by
Determining Lenders, in each case with such maturities as CA
50
Canada, with the consent of Determining Lenders, may specify, pending
application of such funds on account of Reimbursement Obligations or on
account of other Obligations, as the case may be. In the absence of any
such direction from CA Canada, Canadian Agent shall invest the funds held
in the Canadian L/C Cash Collateral Account (so long as the aggregate
amount of such funds exceeds any relevant minimum investment requirement)
in one or more types of investments with the consent of Determining Lenders
with such maturities as Canadian Agent, with the consent of Determining
Lenders, may specify, pending application of such funds on account of
Reimbursement Obligations or on account of other Obligations, as the case
may be. All such investments shall be made in Canadian Agent's name for
the account of Canadian Issuing Bank and Canadian Lenders. CA CANADA
RECOGNIZES THAT ANY LOSSES OR TAXES WITH RESPECT TO SUCH INVESTMENTS SHALL
BE BORNE SOLELY BY CA CANADA, AND CA CANADA AGREES TO HOLD CANADIAN AGENT,
CANADIAN ISSUING BANK, AND LENDERS HARMLESS FROM ANY AND ALL SUCH LOSSES
AND TAXES. Canadian Agent may liquidate any investment held in the
Canadian L/C Cash Collateral Account in order to apply the proceeds of such
investment on account of the Reimbursement Obligations (or on account of
any other Obligations then due and payable, as the case may be) in
accordance with SECTION 2.16(f)(iii) without regard to whether such
investment has matured and without liability for any penalty or other fee
incurred (with respect to which CA Canada hereby agrees to reimburse
Canadian Agent) as a result of such application.
(v) CA Canada shall pay to Canadian Agent the fees customarily
charged by Canadian Issuing Bank with respect to the maintenance of
accounts similar to the Canadian L/C Cash Collateral Account.
(g) NO LIABILITY OF CANADIAN ISSUING BANK. CA Canada assumes all risks of
the acts or omissions of any beneficiary or transferee of any Canadian Letter of
Credit with respect to its use of such Canadian Letter of Credit. None of
Canadian Agent, Canadian Issuing Bank, or any Lender, or any of their respective
officers or directors shall be liable or responsible for: (a) the use that may
be made of any Canadian Letter of Credit or any acts or omissions of any
beneficiary or transferee in connection therewith; (b) the validity, sufficiency
or genuineness of documents, or of any endorsement thereon, even if such
documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by Canadian Issuing Bank against presentation
of documents that do not comply with the terms of a Canadian Letter of Credit,
including failure of any documents to bear any reference or adequate reference
to the Canadian Letter of Credit, except for any payment made upon Canadian
Issuing Bank's gross negligence or willful misconduct; or (d) any other
circumstances whatsoever in making or failing to make payment under any Canadian
Letter of Credit, except that CA Canada shall have a claim against Canadian
Issuing Bank, and Canadian Issuing Bank shall be liable to CA Canada, to the
extent of any direct, but not consequential, damages suffered by CA Canada that
CA Canada proves were caused by (i) Canadian Issuing Bank's willful misconduct
or gross negligence in determining whether documents presented under any
Canadian Letter of Credit comply with the terms of the
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Canadian Letter of Credit or (ii) Canadian Issuing Bank's willful failure to
make lawful payment under a Canadian Letter of Credit after the presentation
to it of a draft and certificates strictly complying with the terms and
conditions of the Canadian Letter of Credit. In furtherance and not in
limitation of the foregoing, Canadian 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.
2.17. REALLOCATION.
(a) Upon three Business Days prior written notice (the "REALLOCATION
NOTICE") to Agent, Canadian Agent and ABN AMRO Bank, N.V. ("ABN"), Borrowers may
on a one time only basis, elect at any time to reduce ABN's portion of the
Domestic Commitment by an amount equal to the lesser of (a) $10,000,000 and (b)
ABN's portion of the Domestic Commitment and either (y) add ABN as a Canadian
Lender in which case ABN's portion of the Canadian Commitment shall be an amount
equal to the Canadian Dollar Exchange Equivalent of Dollars determined on the
effective date of such reallocation contained in the Reallocation Notice, to the
extent that ABN is not a Canadian Lender or (z) increase ABN's portion of the
Canadian Commitment by the Canadian Dollar Exchange Equivalent of Dollars
determined on the effective date of such reallocation contained in the
Reallocation Notice.
(b) The reallocation described in SECTION 2.17(a) may only be exercised
upon the following conditions:
(i) No Event or Event of Default shall have occurred and be
continuing or will result from such reallocation;
(ii) A fee of 1/8 of 1% of the amount of such reduction of ABN's
portion of the Domestic Facility shall be paid to Agent for the sole
benefit of ABN's account, payable in Dollars;
(iii) ABN or an Affiliate of ABN shall be a qualified
Canadian lender; and
(iv) Parent and CA Canada and each Affiliate thereof shall
execute all necessary agreements in connection with the reallocation as
determined by Special Counsel, Agent and Canadian Agent, including without
limitation, a revised SCHEDULE 1.01 in form and substance satisfactory to
the Agent and the Canadian Agent.
2.18. PROVISIONS RESPECTING CANADIAN ADVANCES.
(a) Canadian Advances will be made available by the Canadian Lenders to CA
Canada in an amount not to exceed the Canadian Commitment, subject to the terms
and conditions contained herein, as:
52
(i) Canadian Prime Rate overdraft borrowings in Canadian Dollars
and U.S. Base Rate overdraft borrowings in Dollars the availability of
such borrowings which shall terminate upon any reallocation of the
Commitment in accordance with the SECTION 2.17 or upon Canadian Agent
otherwise ceasing to be the sole Canadian Lender;
(ii) direct Canadian Advances bearing interest at the Canadian
Prime Rate in Canadian Dollars and direct Canadian Advances bearing
interest at the U.S. Base Rate in Dollars;
(iii) Letters of Credit, Letters of Guarantee, and corporate
VISA accounts;
(iv) Interest Hedge Agreements;
(v) Bankers' Acceptances, subject to the terms and conditions
set forth herein; and
(vi) direct Canadian Advances bearing a fixed rate for a fixed
term.
(b) Interest payable on Canadian Advances at a variable rate shall be
adjusted automatically without notice to CA Canada whenever there is a variation
in such rate.
(c) At CA Canada's request and subject to market availability, Canadian
Agent and Canadian Issuing Bank will provide quotes for interest rate swap
agreements and forward rate agreements to provide fixed or floating rate funding
for CA Canada for a term to maturity consistent with CA Canada's cash flow
profile as determined by Canadian Agent and Canadian Issuing Bank's usual
practice for similar type borrowers. Any utilization of the interest rate swap
options and forward rate agreements will automatically be included in the
Obligations hereunder at an amount of the contingent exposure of Canadian Agent
and Canadian Issuing Bank as determined by Canadian Agent and Canadian Issuing
Bank using each of their then current banking practice in similar transactions.
(d) At CA Canada's request and subject to market availability, Canadian
Agent and Canadian Issuing Bank will provide quotes for foreign exchange
contracts. Any utilization of the foreign exchange contract option will
automatically be included in Obligations at an amount of the contingent exposure
of Canadian Agent and Canadian Issuing Bank as determined by Canadian Agent and
Canadian Issuing Bank using each of their then current banking practice in
similar transactions. The aggregate of all contingent Obligations and market
risk exposure of CA Canada, as determined by Canadian Agent and Canadian Issuing
Bank, under Interest Hedge Agreements shall not exceed the lesser of the
Canadian Commitment or the Borrowing Base.
(e) For the purposes of the Interest Act (Canada) and other Applicable
Laws which may hereafter regulate the calculation or computation of interest
with respect to the Canadian
53
Commitment, the annual rates of interest and fees applicable to Canadian
Advances accruing interest based upon the Canadian Prime Rate, U.S. Base
Rate, and Bankers' Acceptance Rate, respectively, are the rates as determined
under this Agreement multiplied by the actual number of days in a period of
one year commencing on the first day of the period for which such interest or
stamping fee is payable and divided by 365.
(f) Interest on Canadian Advances bearing interest at Canadian Prime Rate
and U.S. Base Rate shall accrue and be calculated daily and be payable on such
Business Day as is customary for the Canadian Agent having regard to its then
existing practice. Interest on Canadian Advances bearing Canadian Prime Rate
and U.S. Base Rate and stamping fees on Bankers' Acceptances shall accrue and be
calculated daily on the basis of a 365-day year.
(g) Each Bankers' Acceptance draft tendered by CA Canada for acceptance by
Canadian Agent shall be in a form acceptable to Canadian Agent and shall have a
term equal to one, two, three or six months, as CA Canada shall select, (unless
otherwise agreed to by the Canadian Agent). Stamping fees on Bankers'
Acceptances are payable at the time of issuance at the Bankers' Acceptance Rate
plus the Applicable Margin.
(h) CA Canada shall pre-sign and deliver to Canadian Agent Bankers'
Acceptance drafts in sufficient quantity to meet CA Canada's requirements for
anticipated Canadian Advances by way of Bankers' Acceptances. CA Canada shall
provide for payment to Canadian Agent of each Bankers' Acceptance at its
maturity, either by payment of the face amount thereof or through the
utilization of a Canadian Advance in accordance with this Agreement, or through
a combination thereof. CA Canada waives presentment for payment of Bankers'
Acceptances by Canadian Agent and shall not claim from Canadian Agent any days
of grace for the payment at maturity of Bankers' Acceptances. Any amount owing
by CA Canada in respect of any Bankers' Acceptance which is not paid in
accordance with the foregoing, shall, as and from its maturity date, be deemed
to be outstanding hereunder as a Canadian Prime Rate Advance.
(i) Canadian Agent shall not be liable for any damage, loss or improper use
of any Bankers' Acceptance draft endorsed in blank except for any loss arising
by reason of Canadian Agent failing to use the same standard of care in the
custody of such Bankers' Acceptance drafts as Canadian Agent uses in the custody
of its own property of a similar nature.
(j) CA Canada shall be responsible for, and shall make its own
arrangements with respect to, the sale of Bankers' Acceptances in the market
place. Notwithstanding the foregoing, Canadian Agent may purchase from CA
Canada for its own account any Bankers' Acceptance issued by it at a discount
rate to be agreed upon between CA Canada and Canadian Agent.
(k) CA Canada may in the notice of borrowing, notice of rollover or notice
of conversion requesting a Canadian Advance by way of Bankers' Acceptances or by
subsequent notice to Canadian Agent, provide Canadian Agent with information as
to the discount proceeds payable by the purchasers of the Bankers' Acceptances
and the party to whom delivery of the Bankers'
54
Acceptances is to be made against delivery of such discount proceeds to
Canadian Agent for the credit of CA Canada.
(l) In the case of a rollover of maturing Bankers' Acceptances, Canadian
Agent, in order to satisfy the continuing liability of CA Canada to Canadian
Agent for the face amount of the maturing Bankers' Acceptances, shall retain for
its own account the net proceeds of each new Bankers' Acceptance issued by it in
connection with such rollover and CA Canada shall, on the maturity date of the
maturing Bankers' Acceptances, pay to Canadian Agent an amount equal to the
difference between the face amount of the maturing Bankers' Acceptances and the
aggregate net proceeds of the new Bankers' Acceptances.
(m) In the case of a conversion from a Canadian Prime Rate Advance or a
U.S. Base Rate Advance into a Canadian Advance by way of Bankers' Acceptances,
Canadian Agent, in order to satisfy the continuing liability of CA Canada to
Canadian Agent for the principal amount of the Canadian Advance bearing the
Canadian Prime Rate or the U.S. Base Rate being converted, shall retain for its
own account the net proceeds of each new Bankers' Acceptance issued by it in
connection with such conversion and CA Canada shall, on the date of issuance of
the Bankers' Acceptance pay to Canadian Agent an amount equal to the difference
between the aggregate principal amount of the Canadian Advance bearing the
Canadian Prime Rate or the U.S. Base Rate being converted, including any accrued
interest thereon, owing to Canadian Agent and the aggregate net proceeds of such
Bankers' Acceptances.
(n) In the case of a conversion of a Canadian Advance by way of Bankers'
Acceptances into a Canadian Advance bearing the Canadian Prime Rate or the U.S.
Base Rate, CANADIAN AGENT in order to satisfy the liability of CA Canada to
Canadian Agent for the face amount of the maturing Bankers' Acceptances, shall
record the obligation of CA Canada to it as a Canadian Advance bearing the
Canadian Prime Rate or the U.S. Base Rate, as the case may be, unless CA Canada
provides for payment to Canadian Agent of the face amount of the maturing
Bankers' Acceptance in some other manner acceptable to Canadian Agent.
(o) CA Canada hereby authorizes Canadian Agent to complete, stamp, hold,
sell, rediscount or otherwise dispose of all Bankers' Acceptances accepted by it
in accordance with the instructions provided by CA Canada hereunder.
(p) Upon the occurrence and continuance of an Event of Default and upon
the written request of Canadian Agent, CA Canada shall forthwith pay to Canadian
Agent for deposit into an escrow account maintained by and in the name of
Canadian Agent an amount equal to Canadian Agent's maximum potential liability
under then outstanding Bankers' Acceptances, and other similar availments,
including Canadian Agent's contingent exposure under Interest Hedge Agreements
entered into with CA Canada (the "Escrow Funds"). The Escrow Funds shall be
held by Canadian Agent for set-off against future indebtedness owing by CA
Canada to Canadian Agent in respect of such Bankers' Acceptances and other
similar availments, and pending such application shall bear interest at the rate
declared by Canadian Agent from time to time as that
55
payable by it in respect for deposits for such amount and for the period from
the date of deposit to the maturity date of the Bankers' Acceptances, as the
case may be. If such Event of Default is either waived or cured in
compliance with the terms of this Agreement, then the remaining Escrow Funds
if any, together with any accrued interest to the date of release, shall be
released to CA Canada.
(q) A conversion of a Canadian Advance from one currency to another
currency shall not be made by a netting out of funds unless agreed upon by the
Canadian Agent. To the extent permitted by Applicable Law, the provisions of
the Judgment Interest Act (Alberta) shall not apply to this Canadian Commitment
and are hereby expressly waived by CA Canada. For the purposes of the Interest
Act (Canada), the principal of deemed reinvestment of interest shall not apply
to any interest calculation under this Canadian Commitment and the rates of
interest stipulated in this Canadian Commitment are intended to be nominal rates
and not effective rates or yields.
(r) The aggregate of all contingent Obligations and market risk exposure
of CA Canada, as determined by the Canadian Agent, under Interest Hedge
Agreements, shall not exceed Canadian Dollars $3,000,0000. The term of interest
rate swap agreements and forward contracts shall not exceed the earlier of five
years or the Maturity Date and of any other Interest Hedge Agreement shall not
exceed 18 months, unless agreed otherwise by the Canadian Agent.
(s) Where applicable, all Canadian Advances requested by CA Canada shall
be made available by deposit of the applicable funds (which in the case of
Bankers' Acceptances shall be the net proceeds thereof) into the appropriate
account of CA Canada for value on the Business Day on which the Canadian Advance
is to take place.
(t) (i) CA Canada shall be entitled to rollover one Type of Canadian
Advance into the same Type of Canadian Advance or convert one
Type of Canadian Advance into another Type of Canadian Advance on
the terms herein provided.
(ii) If CA Canada fails to give Canadian Agent a duly completed notice
of rollover or notice of conversion if and as required, or if in
giving such notice CA Canada fails to provide for the rollover or
conversion of all of the Canadian Advances then maturing, CA
Canada shall be deemed to have irrevocably elected to convert a
maturing advance, or that part of such maturing advance which CA
Canada has failed to provide for in such notice, as the case may
be, into a Canadian Prime Rate loan with respect to a Canadian
Dollar borrowing or a U.S. Base Rate loan with respect to a U.S.
Dollar borrowing.
(iii) No conversion of a Bankers' Acceptance shall be made prior
to its maturity date.
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ARTICLE III. CONDITIONS PRECEDENT
3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS. The effectiveness of this
Agreement is subject to fulfillment of the following conditions precedent:
(a) The making of the Commitment and the initial Advance shall not
contravene any Law applicable to Agent, Canadian Agent, Issuing Bank, Canadian
Issuing Bank, or any Lender.
(b) No Material Adverse Change, as determined by Agent or Canadian Agent,
as the case may be, shall have occurred and be continuing since October 31,
1996.
(c) Parent and CA Canada shall have delivered to Agent or Canadian Agent,
as the case may be:
(i) an Officer's Certificate executed by authorized officers of
Parent, dated the Effective Date, certifying (A) that an original of
Parent's certificate of incorporation certified by the Secretary of State
of Georgia and a copy of its bylaws attached thereto are true and complete,
and in full force and effect, without amendment except as shown, (B) that a
copy of Parent's resolutions attached thereto authorizing execution,
delivery, and performance of this Agreement and all other Loan Papers is
true and complete, and that such resolutions are in full force and effect,
were duly adopted, have not been amended, modified, or revoked, and
constitute all resolutions of Parent adopted with respect to this loan
transaction, and (C) to the incumbency, name, and signature of each officer
authorized to sign this Agreement and all other Loan Papers on Parent's
behalf.
(ii) an Officer's Certificate executed by authorized officers of
CA Canada, dated the Effective Date, certifying (A) that an original of CA
Canada's certificate or articles of incorporation and originals of the
certificates of registration (or like documents) from every jurisdiction in
Canada in which CA Canada is or is deemed to be carrying on business or is
otherwise required to be registered, certified by the appropriate authority
in each jurisdiction and a copy of its bylaws attached thereto are true and
complete, and in full force and effect, without amendment except as shown,
(B) that a copy of CA Canada's resolutions attached thereto authorizing
execution, delivery, and performance of this Agreement and all other Loan
Papers is true and complete, and that such resolutions are in full force
and effect, were duly adopted, have not been amended, modified, or revoked,
and constitute all resolutions of CA Canada adopted with respect to this
loan transaction, and (C) to the incumbency, name, and signature of each
officer authorized to sign this Agreement and all other Loan Papers on CA
Canada's behalf.
(iii) an Officer's Certificate executed by authorized officers of
each Obligor (other than Parent and CA Canada), dated the Effective Date,
certifying (A) that an original of such Obligor's certificate of
incorporation certified by the Secretary of State
57
of the jurisdiction of incorporation and a copy of its bylaws attached
thereto are true and complete, and in full force and effect, without
amendment except as shown, (B) that a copy of such Obligor's resolutions
attached thereto authorizing execution, delivery, and performance of all
Loan Papers is true and complete, and that such resolutions are in full
force and effect, were duly adopted, have not been amended, modified, or
revoked, and constitute all resolutions of such Obligor adopted with
respect to this loan transaction, and (C) to the incumbency, name, and
signature of each officer authorized to sign all Loan Papers on such
Obligor's behalf.
Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank and each Lender may
conclusively rely on the certificates delivered pursuant to this SECTION 3.01
until it receives notice in writing to the contrary.
(d) Agent shall have received, in form and substance satisfactory to it,
(i) certificates from the Secretary of State and other appropriate officials of
the state of organization, all issued within ten days of the Effective Date,
certifying that each Obligor which is a corporation or partnership is duly
organized, validly existing, and in good standing in said state as of the
respective dates thereof, and (ii) with respect to each other jurisdiction in
which the nature of such Obligor's business is such that qualification to do
business in necessary or advisable, certificates of appropriate authorities in
each such jurisdiction, all issued within ten days of the Effective Date, to the
effect that such Obligor is in good standing and duly qualified to transact
business in each such jurisdiction.
(e) Agent and Canadian Agent shall have received (in sufficient
counterparts as determined by Agent):
(i) opinions of counsel to Parent, CA Canada and each other
Obligor, dated the Effective Date, in the form of EXHIBIT G, together with
duly executed instruction letters in the form of EXHIBIT H;
(ii) duly executed Solvency Certificates for Parent, CA Canada
and each other Obligor, in the form of EXHIBIT I;
(iii) the duly executed Guaranty of each Guarantor;
(iv) the duly executed Parent Guaranty of CA Canada's Obligations
under this Agreement;
(v) a Borrowing Notice, a Compliance Certificate (with
calculations for the 365-day period ended on the Effective Date) dated
October 31, 1996, and a Borrowing Base Certificate dated as of January 27,
1997;
(vi) copies of insurance binders or certificates covering the
Inventory;
58
(vii) copies of the projected financials of Parent and CA Canada
for the following year, certified by an authorized officer to be prepared
in good faith and to be an accurate representation of management's
projected financial condition of Parent and CA Canada;
(viii) copies of this Agreement and all Loan Papers, pursuant
to terms and conditions required by Agent, all in form and substance
satisfactory to Agent and completed and executed by each Obligor and any
other Person, as appropriate;
(ix) a description in detail satisfactory to Agent and Canadian
Agent describing all Litigation (excluding Litigation all expenses and
potentially liability with respect to which is entirely covered by
insurance) related to each Obligor which if adversely determined could
reasonably be expected to result in a Material Adverse Change;
(x) financial statements for Parent, including the most recent
audited financial statements of Parent and each subsequent unaudited
interim financial statement of each Obligor; and
(xi) the most recent unaudited financial statements of CA Canada.
(f) Payment of all fees (including reasonable attorneys' fees incurred by
Agent in the preparation and negotiation of this Agreement, the Loan Papers and
this loan facility).
3.02. CONDITIONS PRECEDENT TO ALL ADVANCES, LETTERS OF CREDIT AND
CANADIAN LETTERS OF CREDIT.
(a) The obligation of each Lender to make each Advance (including the
Initial Advance) and of Issuing Bank or Canadian Issuing Bank to issue each
Letter of Credit or Canadian Letter of Credit shall be subject to the further
conditions precedent that on the date of such Advance or the issuance of such
Letter of Credit or Canadian Letter of Credit (i) the following statements shall
be true (and the delivery of each Borrowing Notice under SECTION 2.02(a) and
each Conversion or Continuation Notice under SECTION 2.08(b), or the failure to
deliver a Conversion or Continuation Notice under SECTION 2.08(b), and each
Notice of Issuance under SECTION 2.15(b) or SECTION 2.16(b) shall constitute a
representation that on the disbursement or issuance date (except as to
representations and warranties which (i) refer to a specific date, (ii) have
been modified by transactions permitted pursuant to this Agreement or any other
Loan Paper, or (iii) have been specifically waived in writing by Agent) they are
true):
(x) The representations and warranties contained in ARTICLE IV
are true and correct on such date, as though made on and as of such date,
(y) No event has occurred and is continuing, or would result
from such Advance or the issuance of such Letter of Credit or Canadian Letter of
Credit (including the
59
intended application of the proceeds of such Advance, such Letter of
Credit or such Canadian Letter of Credit), that does or could constitute
a Default or Event of Default, and
(z) Each Subsidiary of Parent other than CAFS shall have
executed and delivered to Agent or Canadian Agent, as the case may be, a
Guaranty; and (ii) which respect to any Lender which has not previously made
an Advance and any participant which has not previously advanced funds to a
Lender for an Advance, Agent shall have received, in form and substance
acceptable to it, such other approvals, documents, certificates, opinions,
and information as it may deem necessary or appropriate for such Lender or
participant.
(b) In addition, but without duplication of any of the foregoing, the
obligation of the Canadian Agent to make available or continue to make available
any Canadian Advance is subject to the Canadian Agent first having received and
found satisfactory as to form and content the following: (i) the Parent
Guaranty, (ii) standard documentation of the Canadian Agent with respect to: (x)
Interest Hedge Agreements; (x) overdraft lending agreement; (y) undertaking
relative to Bankers' Acceptances; and (iii) cash management; and (iv) the
Canadian Letters of Credit and letters of guarantee; and (v) all usual and
normal agreements and account documentation as required by the Canadian Agent in
respect of the operating accounts of CA Canada to be maintained with the
Canadian Agent.
3.03. CONDITIONS PRECEDENT TO CERTAIN ADVANCES, LETTERS OF CREDIT AND
CANADIAN LETTERS OF CREDIT. The obligation of each Lender to make each Advance
in excess of United States $75,000,000 (including the Initial Advance) and of
Issuing Bank or Canadian Issuing Bank to issue each Letter of Credit or Canadian
Letter of Credit to the extent that Borrowers' collective Obligations under this
Agreement and the other Loan Papers shall in the aggregate exceed United States
$75,000,000 shall be subject to the further condition precedent that on the date
of such Advance or the issuance of such Letter of Credit or Canadian Letter of
Credit, the Borrowers shall have received the consent of the Senior Holders
holding no less than 66 2/3% of the principal amount of the Senior Notes
allowing each Guarantor to guarantee the entire amount of the Commitment.
ARTICLE IV. REPRESENTATIONS AND WARRANTIES
Parent and CA Canada each represent and warrant to Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank and each Lender that the following are true
and correct:
4.01. ORGANIZATION AND QUALIFICATION. Parent is a corporation duly
organized, validly existing, and in good standing under the Laws of the State of
Georgia. Parent is qualified to do business in all jurisdictions where the
nature of its business or Properties require such qualification, except where
the failure to so qualify would not result in a Material Adverse Change. Set
forth on SCHEDULE 4.01-a is a complete and accurate listing of Parent, showing
(a) its street and mailing address, which is its principal place of business and
executive office, (b) the classes of equity interests capital stock authorized
and outstanding, and (c) all outstanding options,
60
rights, rights of conversion or purchase, rights of first refusal, and
similar rights relating to the equity interests of Parent. CA Canada is a
corporation duly organized, validly existing, and in good standing under the
Laws of Canada. CA Canada is qualified to do business in all jurisdictions
where the nature of its business or Properties require such qualification,
except where the failure to so qualify would not result in a Material Adverse
Change. Set forth on SCHEDULE 4.01-c is a complete and accurate listing of
CA Canada, showing (a) its street and mailing address, which is its principal
place of business and executive office, (b) the classes of equity interests
capital stock authorized and outstanding, and (c) all outstanding options,
rights, rights of conversion or purchase, rights of first refusal, and
similar rights relating to the equity interests of CA Canada. Ashley is a
corporation duly organized, validly existing, and in good standing under the
Laws of the State of Georgia. Cameron is a corporation duly organized,
validly existing, and in good standing under the Laws of the State of
Georgia. CABP is a corporation duly organized, validly existing, and in good
standing under the Laws of the State of Arizona. CAFS is a corporation duly
organized, validly existing, and in good standing under the Laws of the State
of Texas. Each of Ashley, Cameron, CABP and CAFS is qualified to do business
in all jurisdictions where the nature of its business or Properties require
such qualification, except where the failure to so qualify would not result
in a Material Adverse Change. Set forth on SCHEDULE 4.01-b is a complete and
accurate listing, with respect to Ashley, Cameron, CABP and CAFS showing (a)
its street and mailing address, which is its principal place of business and
executive office, (b) the classes of capital stock and the numbers of shares
authorized and outstanding, (c) each legal and beneficial owner of
outstanding capital stock on the date hereof, indicating the ownership
percentage, and (d) all outstanding options, rights, rights of conversion or
purchase, rights of first refusal, and similar rights relating to the equity
interests of such Obligor. Each of Parent, CA Canada and each other Obligor
and CAFS has all requisite corporate power and authority to own, operate and
encumber its Property and assets and to conduct its business as presently
conducted and as proposed to be conducted in connection with and following
the consummation of the transactions contemplated by this Agreement and the
other Loan Papers. All of the outstanding common stock of each Obligor and
CAFS is validly issued, fully paid, and nonassessable.
4.02. DUE AUTHORIZATION; VALIDITY. The Board of Directors of each
Obligor and CAFS have duly authorized the execution, delivery, and performance
of the Loan Papers to be executed by such Obligor and CAFS. No consent of the
stockholders of any Obligor or CAFS (except any consent already obtained) is
required as a prerequisite to the validity and enforceability of any Loan Papers
or any other document contemplated hereby. Each Obligor and CAFS has full legal
right, power, and authority to execute, deliver, and perform under the Loan
Papers to be executed and delivered by it. The Loan Papers constitute the
legal, valid, and binding obligations of each Obligor and CAFS (as to each Loan
Paper to which it is a party) enforceable in accordance with their terms
(subject as to enforcement of remedies to any applicable Debtor Relief Laws).
4.03. CONFLICTING AGREEMENTS AND OTHER MATTERS. The execution or
delivery of any Loan Paper, and performance thereunder, does not conflict with,
or result in a breach of the terms, conditions, or provisions of, or constitute
a default under, or result in any violation of, or result
61
in the creation of any Lien upon any Properties of any Obligor or CAFS under,
or require any consent (other than consents already obtained), approval, or
other action by, notice to, or filing with any Tribunal or Person pursuant
to, the corporate governance documents of such Obligor or CAFS, any award of
any arbitrator, or any agreement, instrument, or Law to which such Obligor or
CAFS or any of its Properties is subject.
4.04. FINANCIAL STATEMENTS; FISCAL YEAR. The financial statements of
Parent, CA Canada and its Subsidiaries dated October 31, 1996 delivered to Agent
fairly present its financial condition and the results of operations as of the
dates and for the periods shown, all in accordance with GAAP. Such financial
statements reflect all material liabilities, direct and contingent, of Parent,
CA Canada and its Subsidiaries that are required to be disclosed in accordance
with GAAP. As of the date of such financial statements, there were no
Contingent Liabilities, liabilities for Taxes, forward or long-term commitments,
or unrealized or anticipated losses from any unfavorable commitments that are
not reflected on such financial statements or otherwise disclosed in writing to
Agent. Since October 31, 1996, there has been no Material Adverse Change.
Parent, CA Canada and each other Obligor is Solvent. The projected financial
statements of Parent dated January 9, 1997, delivered to Agent were prepared in
good faith and management believes them to be based on reasonable assumptions
(each of which are stated in such statement) and to provide reasonable
estimations of future performance as of the dates and for the periods shown for
Parent, subject to the uncertainty and approximation inherent in any
projections. Parent's fiscal year ends on October 31.
4.05. LITIGATION. Shown on SCHEDULE 4.05 is all Litigation (other than
Litigation involving counterclaims against an Obligor or CAFS as part of
Litigation initiated by such Obligor or CAFS for collection of an Account) that
is pending and, to Parent's and CA Canada's best knowledge, threatened against
each Obligor and CAFS on the date hereof which if adversely determined could
reasonably be expected to result in a Material Adverse Change. There is no
pending or, to Parent's or CA Canada's best knowledge, threatened Litigation
against any Obligor and CAFS that could constitute a Material Adverse Change.
4.06. COMPLIANCE WITH LAWS REGULATING THE INCURRENCE OF DEBT. No
proceeds of any Advance or Letter of Credit will be used directly or indirectly
to acquire any security in any transaction which is subject to Sections 13 and
14 of the Securities Exchange Act of 1934, as amended. No Obligor is engaged in
the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System), and no proceeds of any Advance, Letter
of Credit or Canadian Letter of Credit will be used to purchase or carry any
margin stock or to extend credit to others for the purpose of purchasing or
carrying any margin stock. Following Borrowers' intended use of the proceeds of
each Advance, Letter of Credit or Canadian Letter of Credit, not more than 25%
of the value of the assets of Parent or CA Canada will be "margin stock" within
the meaning of Regulation U. No Obligor is subject to regulation under the
Public Utility Holding Company Act of 1935, the Federal Power Act, the
Investment Company Act of 1940, the Interstate Commerce Act (as any of the
preceding acts have been amended), or any other Law that the
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incurring of Debt by such Obligor would violate in any material respect,
including without limitation Laws relating to common or contract carriers or
the sale of electricity, gas, steam, water, or other public utility services.
4.07. LICENSES, TITLE TO PROPERTIES, AND RELATED MATTERS. Each Obligor
and CAFS possesses all material Licenses and is not in violation thereof in any
material respect. Each Obligor and CAFS has full power, authority, and legal
right to own and operate its Properties, and to conduct its business. Each
Obligor and CAFS has good and indefeasible title (fee or leasehold, as
applicable) to its Properties, subject to no Lien of any kind, except as
permitted hereunder. No Obligor or CAFS is in violation of its corporate
governance documents, or any Law, or material agreement or instrument binding on
or affecting it or any of its Properties. No business or Properties of any
Obligor or CAFS is affected by any strike, lock-out, or other labor dispute,
drought, storm, earthquake, embargo, act of God or public enemy, or other
casualty that could constitute a Material Adverse Change.
4.08. OUTSTANDING DEBT; EXISTING LIENS. No Obligor or CAFS has any
outstanding Debt or Contingent Liabilities, except as shown on SCHEDULE 4.08-a,
and neither it nor any of its Properties are subject to any Liens, except as
shown on SCHEDULE 4.08-b. SCHEDULE 4.08-a is a complete and correct description
of each Note Purchase Agreement, each Senior Note, each other Senior Note Paper,
and each Senior Holder. No equity interest of any Obligor or CAFS (other than
Parent) is subject to any Lien, including any restriction on hypothecation or
transfer.
4.09. TAXES. Each Obligor and CAFS has filed all federal, provincial,
state, and other Tax returns (or extensions related thereto) which are required
to be filed, and has paid all Taxes as shown on said returns, as well as all
other Taxes, to the extent due and payable before penalty. All Tax liabilities
of each Obligor and CAFS are adequately provided for on its books, including
interest and penalties, and adequate reserves have been established therefor in
accordance with GAAP. Except as shown on SCHEDULE 4.09, no income Tax liability
of a material nature has been asserted by taxing authorities for Taxes in excess
of those already paid other than income tax liabilities being contested in good
faith and for which adequate reserves have been established therefor in
accordance with GAAP, and no taxing authority has notified any Obligor or CAFS
of any deficiency in any Tax return.
4.10. ERISA. Each Plan has satisfied the minimum funding standards
under all Laws applicable thereto, and no Plan has an accumulated funding
deficiency thereunder. No Obligor or CAFS has incurred any material liability
to the PBGC with respect to any Plan. No ERISA Event has occurred with respect
to any Plan. No Obligor or CAFS has participated in any Prohibited Transaction
with respect to any Plan or trust created thereunder, and the consummation of
the transactions contemplated hereby will not involve any Prohibited
Transaction. Neither any Obligor, CAFS nor any ERISA Affiliate has incurred any
Withdrawal Liability to any Multiemployer Plan. Neither any Obligor, CAFS nor
any ERISA Affiliate has been notified by the sponsor of a Multiemployer Plan
that such Multiemployer Plan is in reorganization or has been terminated, within
the meaning of Title IV of ERISA.
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4.11. ENVIRONMENTAL LAWS. The real Properties (whether leased or
owned) of each Obligor and CAFS, and the operations conducted thereon by it or,
to Parent's and CA Canada's best knowledge (solely with respect to real
Properties owned by CA Canada), any current or prior owner or operator thereof,
(a) do not violate and have not violated any applicable Environmental Law, the
violation of which would constitute a Material Adverse Change or result in
costs, penalties, fines, or damages in an aggregate amount of $1,000,000 or
more, and (b) are not subject to any pending or threatened investigation or
proceeding by any Tribunal or to any remedial obligations under any
Environmental Law. All Licenses have been obtained or filed that are required
under any Environmental Law in connection with the use of such Property and
assets (including without limitation past or present treatment, storage,
disposal, or release of any Hazardous Materials into the environment). No
Hazardous Materials are generated, produced, or stored at or in connection with
the Properties and operations of any Obligor. Each Obligor and CAFS has taken
all appropriate steps to determine, and has determined, that no Hazardous
Materials have been disposed of or otherwise released on or to any Property on
which any operations of such Obligor or CAFS are conducted, except in compliance
with Environmental Laws. No Obligor or CAFS has any material potential
liability with respect to any release of any Hazardous Materials into the
environment. The use which each Obligor makes or intends to make of the real
Property (whether leased or owned) on which any of its operations are conducted
will not result in the unlawful or unauthorized disposal or other release of any
Hazardous Materials, except in compliance with applicable Environmental Laws.
Each Obligor and CAFS has delivered to Agent copies of all environmental studies
and reports conducted or received by such Obligor or CAFS in connection with its
real Properties. Such studies cover all real Property in which such Obligor has
an interest.
4.12. INVESTMENTS; SUBSIDIARIES. No Obligor or CAFS has any
Investments except as described on SCHEDULES 4.01-a, 4.01-b and 4.12 and as
permitted by SECTION 5.09. SCHEDULES 4.01-a and 4.01-b are a complete and
accurate listing of each Subsidiary (other than CAFS) of each Obligor, showing
(a) its complete name, (b) its jurisdiction of organization, (c) its capital
structure, (d) its street and mailing address, which is its principal place of
business and executive office and (e) all interest in such Subsidiary owned by
such Obligor.
4.13. CERTAIN FEES. No broker's, finder's, management fee or other fee
or commission will be payable by Parent or CA Canada (other than to Agent and
Lenders hereunder and to NationsBanc Capital Markets, Inc.). Parent and CA
Canada each severally hereby agree to indemnify and hold harmless Agent,
Canadian Agent and each Lender from and against any claims, demand, liability,
proceedings, costs or expenses asserted with respect to or arising in connection
with any such fees or commissions.
4.14. CABP. CABP owns no Property other than (a) trademarks, patents
and copyrights, and associated goodwill, applications for trademarks, patents
and copyrights, and other property which is intangible intellectual property,
(b) licenses from CABP to Parent, Ashley, Cameron and CA Canada of Property
described in CLAUSE (a), (c) demand deposit accounts the aggregate balance
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of which is not in excess of an amount reasonable and necessary to the
business operations of CABP, and (d) other Property of nominal value
reasonable and necessary to the business operations of CABP.
4.15. DISCLOSURE. Parent and CA Canada have not made a material
misstatement of fact, or failed to disclose any fact necessary to make the facts
disclosed not misleading, to Agent, Canadian Agent or any Lender during the
course of application for and negotiation of any Loan Papers or otherwise in
connection with any Advance, any Letter of Credit or any Canadian Letter of
Credit. There is no fact known to Parent or CA Canada that materially adversely
affects any Obligor's Properties or business, or that would constitute a
Material Adverse Change, and that has not been set forth in the Loan Papers or
in other documents furnished to Agent, Canadian Agent or each Lender.
4.16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES, DISCLAIMERS, WAIVERS,
ETC. All representations, warranties, disclaimers and waivers made under this
Agreement and each other Loan Paper shall survive the execution and
effectiveness of this Agreement and shall be deemed to be made at and as of the
Effective Date and at and as of the date of each Advance and issuance of each
Letter of Credit and Canadian Letter of Credit, and each shall be true and
correct when made, except to the extent (a) previously fulfilled in accordance
with the terms hereof, (b) subsequently inapplicable, or (c) previously waived
in writing by Agent, Canadian Agent and Lenders with respect to any particular
factual circumstance.
ARTICLE V. NEGATIVE COVENANTS
So long as the Commitment or any Advance or any Reimbursement Obligations
is outstanding, or Parent, CA Canada or any other Obligor owes any other amount
hereunder or under any other Loan Paper:
5.01. CURRENT RATIO. Parent shall not permit the ratio of Current
Assets to Current Liabilities as at any date to be less than 1.50 to 1.
5.02. TANGIBLE NET WORTH. Parent shall not permit Tangible Net Worth
as at any date to be less than the sum of (a) $50,000,000, plus (b) 50% of
cumulative Net Income reported for each fiscal quarter of Parent in which Net
Income is a positive number commencing with the fiscal quarter of Parent ending
on October 31, 1996, plus (c) 100% of Equity Proceeds.
5.03. FUNDED DEBT TO EBITDA RATIO. Parent shall not permit the Funded
Debt to EBITDA Ratio as at any date to exceed 3.5 to 1.
5.04. FIXED CHARGES COVERAGE RATIO. Parent shall not permit the Fixed
Charges Coverage Ratio as at any date to be less than 2.00 to 1.
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5.05. RESTRICTED PAYMENT. Parent shall not, and shall not permit any
Subsidiary of Parent to, make any Restricted Payment; PROVIDED, that if no
Default or Event of Default exists or will result therefrom, (a) Parent may make
cash Distributions in a fiscal year to holders of Parent's equity securities in
an aggregate amount not greater than the Permitted Amount, (b) Ashley, Cameron
and CAFS may make Distributions to Parent, (c) CA Canada may make Distributions
to Cameron, (d) CABP may make Distributions to Parent, Ashley and Cameron, (e)
▇▇▇▇▇▇ ▇▇▇ make cash payments to CGW in accordance with the Ashley Management
Agreement, and (f) Cameron may make cash payments to CGW in accordance with the
Cameron Management Agreement; PROVIDED FURTHER, that no Distribution otherwise
permitted by SECTION 5.05(a) shall be made prior to receipt by Agent of the
financial statements of Parent and their respective Subsidiaries required by
SECTION 6.10(b) for the fiscal year to which such proposed Distribution is
attributable and a Compliance Certificate prepared after giving effect to such
proposed Distribution.
5.06. CAPITAL EXPENDITURES. Parent shall not, and shall not permit any
Subsidiary of Parent to, pay or incur Capital Expenditures (in the aggregate for
Parent and their respective Subsidiaries in excess of $13,500,000 during any
fiscal year of Parent).
5.07. DEBT. PARENT AND SUBSIDIARIES OTHER THAN CAFS. Parent shall not,
and shall not permit any of their respective Subsidiaries (other than CAFS) to,
create, incur, assume, become, or be liable in any manner in respect of, or
suffer to exist, any Debt, except (a) Debt under the Loan Papers,(b) Funded Debt
under each Note Purchase Agreement and guaranties of such Debt made by
Subsidiaries of Parent,(c) other Debt in existence on the date hereof, as shown
on SCHEDULE 4.08-a, (d) purchase money Debt incurred for the acquisition of
tangible assets, provided the aggregate principal amount of such Debt incurred
in any fiscal year shall not exceed $1,000,000,(e) trade payables incurred and
paid in the ordinary course of business,(f) Contingent Liabilities under or
relating to the Loan Papers,(g) Contingent Liabilities in existence on the date
hereof, as shown on SCHEDULE 4.08-a,(h) Debt of each Subsidiary of Parent (other
than CAFS) to Parent, (i) Contingent Liabilities resulting from the endorsement
of negotiable instruments for collection in the ordinary course of business,(j)
Convertible Subordinated Debt in an aggregate principal amount not to exceed at
any time $25,000,000,(k) as to Parent and its Subsidiaries (other than CAFS) on
a consolidated basis, other Debt not to exceed at any time, in the aggregate
principal amount, the difference between (i) $10,000,000, minus (ii) the sum of
all Attributable Debt in respect of all Sale and Leasebacks occurring on and
after the Effective Date, (l) renewals and restatements of any Debt described in
SECTIONS 5.07(a) through (l), provided the principal amount of the Debt renewed
or restated does not exceed the principal amount of such Debt immediately prior
to such renewal or restatement, and (m) as to Parent, only, its obligations
under the CAFS Guaranty.
5.08. DISPOSITIONS OF ASSETS. Parent and CA Canada shall not, and
shall not permit any of its Subsidiaries to, sell, lease, assign, or otherwise
dispose of any of its assets, except (a) with respect to Parent, CA Canada, and
their respective Subsidiaries (other than CAFS), Permitted
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Dispositions, and (b) with respect to CAFS, Transfers of assets in the
ordinary course of business of CAFS for full and fair consideration.
5.09. MERGER; CONSOLIDATION; INVESTMENTS. Parent and CA Canada shall
not, and shall not permit any of its Subsidiaries to, merge into, consolidate
with, or make any Investment in, any Person, permit any other Person to merge
into or consolidate with it, or form or acquire any Subsidiary, except
(a) Investments existing on the date hereof as shown on SCHEDULE 4.12,
(b) Restricted Investments, (c) Permitted Acquisitions provided that the
consideration paid in any such acquisition is less than $5,000,000, (d)
Permitted Acquisitions provided that the consideration paid in any such
acquisition is equal to or greater than $5,000,000, if not less than ten
Business Days prior to the effective date of the proposed acquisition, Parent
and CA Canada shall have delivered to Agent (A) a detailed written description
of the proposed Permitted Acquisition, (B) a statement certified by an
authorized officer that the proposed transaction complies with the requirements
of a Permitted Acquisition and stating that no Default or Event of Default
exists prior to or will exist upon consummation of the proposed Permitted
Acquisition, and (C) a Compliance Certificate (with calculations for the 365-day
period ended on the effective date of the proposed acquisition) prepared as of
the effective date of the proposed Permitted Acquisition and based on PRO FORMA
financial statements for Parent and CA Canada giving effect to such transaction
(which financial statements shall not exclude any expenses Parent and CA Canada
projects to be eliminated by such proposed acquisition), (e) Parent and CA
Canada may organize new Subsidiaries; PROVIDED, (i) such Subsidiary executes and
delivers to Agent a Guaranty and such other documents as Agent may reasonably
request prior to such Subsidiary's engaging in any activities other than
organizational activities and (ii) no Default or Event of Default results from
the creation of such Subsidiary, (f) the merger or consolidation of Wholly-Owned
Subsidiaries of Parent and CA Canada between themselves or into Parent and CA
Canada so long as Parent and CA Canada is the surviving entity; PROVIDED, CAFS
shall not merge or consolidate with or into any Person and shall not make any
Investment other than (y) making direct and indirect loans to or acquiring
existing loans made to residential consumers to acquire building materials sold
by Parent or CA Canada or a Guarantor for use in the construction or improvement
of personal residences and (z) Investments described in CLAUSES (a), (b), and
(e) through (k) of the definition of "Restricted Investments", (g) the merger or
consolidation of any other Person with or into Parent or CA Canada so long as
Parent or CA Canada is the surviving entity and no Default or Event of Default
exists prior to or as a result of such merger or consolidation, and (h)
Investments in account receivables arising in the ordinary course of business.
5.10. LIENS. Parent and CA Canada shall not, and shall not permit any
of its Subsidiaries (other than CAFS) to, create or suffer to exist any Lien
upon any of its Properties, except (a) Liens created by the Loan Papers,
(b) Liens in existence on the date hereof, as shown on SCHEDULE 4.08-b, (c) Tax,
mechanics', materialmen's, warehousemen's, laborer's and landlord and other
similar Liens relating to amounts that are not yet due and payable, or that are
being contested in good faith by appropriate proceedings, for which adequate
reserves have been established, (d) Liens securing Debt permitted under SECTION
5.07(d), provided such Lien shall encumber only the specific property acquired
by such Debt, (e) Liens incurred in the ordinary course of business in
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connection with worker's compensation, unemployment insurance or similar
legislation; and (f) easements, right-of-way, restrictions and other similar
encumbrances on the use of real property which do not interfere with the
ordinary conduct of the business of such Person. Parent and CA Canada shall
not, and shall not permit any of its Subsidiaries (other than CAFS) to,
hereafter agree with any Person (other than Agent) not to ▇▇▇▇▇ ▇ ▇▇▇▇ on any of
its assets or not to permit the pledge any of its equity interest (except as may
be provided in each Note Purchase Agreement).
5.11. FISCAL YEAR AND ACCOUNTING METHOD. Without Agent's prior written
approval, Parent and CA Canada shall not, and shall not permit any of its
Subsidiaries to, change its fiscal year or method of accounting, except as may
be required by GAAP.
5.12. ISSUANCE OF CAPITAL STOCK; AMENDMENT OF CHARTER.
(a) SUBSIDIARIES OTHER THAN CAFS. Parent and CA Canada shall not
permit any of its Subsidiaries (other than CAFS) to, issue, sell or
otherwise dispose of any capital stock in such Person, or any options or
rights to acquire such capital stock. Parent and CA Canada shall not sell,
transfer, encumber or otherwise dispose of any equity interest or ownership
interest in any Subsidiary of Parent or CA Canada (other than CAFS) and
shall not permit any Subsidiary of Parent or CA Canada (other than CAFS) to
sell, transfer, encumber or otherwise dispose of any equity interest or
ownership interest in any Person which is a Subsidiary of such Subsidiary
of Parent or CA Canada.
(b) BORROWERS AND ALL SUBSIDIARIES. Borrowers shall not amend their
respective articles of organization or bylaws, and Parent and CA Canada
shall not permit any of its Subsidiaries to amend its articles of
organization or bylaws, in any manner which impairs or revokes any approval
related to the Loan Papers.
(c) CAFS. Parent shall not permit CAFS to issue, sell or otherwise
dispose of any capital stock, or any options or rights to acquire such
capital stock, except for full and fair consideration. Parent shall not
sell, transfer, encumber or otherwise dispose of any equity interest or
ownership interest in CAFS if after giving effect to any sale of any equity
interest in CAFS Parent owns less than 50% of the voting securities of CAFS
or does not possess the power to direct or cause the direction of
management of policies of CAFS; PROVIDED, Parent may sell any or all equity
interest in CAFS owned by Parent if contemporaneously with such sale Parent
is released of all liability with respect to CAFS, including all CAFS
Liability.
5.13. CHANGE OF OWNERSHIP. Parent and CA Canada shall not, and shall
not permit any of its Subsidiaries to, permit any change in the ownership of
(a) Ashley, Cameron, CABP and CA Canada from the ownership thereof as of the
date hereof as disclosed on SCHEDULE 4.01-b and (b) CAFS not permitted by
SECTION 5.12.
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5.14. SALE AND LEASEBACK. Parent shall not, and shall not permit any
of its Subsidiaries (other than CAFS) to, enter into any Sale and Leaseback if
the Attributable Debt of such Sale and Leaseback exceeds the difference between
(a) $10,000,000, minus (b) the sum of (i) the aggregate amount of all
Attributable Debt of all other Sale and Leasebacks occurring on and after the
Effective Date plus (ii) the aggregate outstanding principal amount of other
Debt of Parent and their Subsidiaries (other than CAFS) permitted pursuant to
SECTION 5.07(a)(xi). Parent shall not permit CAFS to enter into any Sale and
Leaseback.
5.15. BUSINESS. Parent and CA Canada shall not, and shall not permit
any of its Subsidiaries to, change the nature of its business as conducted on
the Effective Date. Neither Parent nor any Subsidiary of Parent (other than
CAFS) shall engage at any time in any business now or hereafter conducted by
CAFS. CAFS shall not engage in any business other than making direct and
indirect loans to or acquiring existing loans made to residential consumers to
acquire building materials sold by Parent or a Guarantor for use in the
construction or improvement of personal residences and the securitization of
such loans.
5.16. TRANSACTIONS WITH AFFILIATES. Except as permitted herein, Parent
and CA Canada shall not, and shall not permit any of its Subsidiaries to, enter
into or be party to a transaction with any Affiliate of such Person, except on
terms no less favorable than could be obtained on an arm's-length basis with a
Person that is not an Affiliate of such Person; PROVIDED, all transactions by
CAFS with any Affiliate of Parent and CA Canada shall be in accordance with the
Separateness Agreement.
5.17. COMPLIANCE WITH ERISA. Parent and CA Canada shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, or permit any
member of such Person's Controlled Group to directly or indirectly, (a)
terminate any Plan so as to result in any material (in the opinion of Agent)
liability to any Obligor or any member of its Controlled Group, (b) permit to
exist any ERISA Event, or any other event or condition which presents the risk
of any material (in the opinion of Agent) liability of any Obligor or any member
of its Controlled Group, (c) make a complete or partial withdrawal (within the
meaning of Section 4201 of ERISA) from any Multiemployer Plan so as to result in
any material (in the opinion of Agent) liability to any Obligor or any member of
its Controlled Group, (d) enter into any new Plan or modify any existing Plan so
as to increase its obligations thereunder (except in the ordinary course of
business consistent with past practice) which could result in any material (in
the opinion of Agent) liability to any Obligor or any member of its Controlled
Group, or (e) permit the present value of all benefit liabilities, as defined in
Title IV of ERISA, under each Plan of each Obligor or any member of its
Controlled Group (using the actuarial assumptions utilized by the PBGC upon
termination of a Plan) to materially (in the opinion of Agent) exceed the fair
market value of Plan assets allocable to such benefits all determined as of the
most recent valuation date for each such Plan.
5.18. NOTE PURCHASE AGREEMENT. Parent shall not, and shall not permit
any of its Subsidiaries to, enter into or permit to exist any amendment or
restatement of any Note Purchase Agreement, Senior Note or other Senior Note
Paper which has the effect of (a) increasing the
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principal amount of all Senior Notes outstanding on the Effective Date, minus
the aggregate amount of all principal of all Senior Notes repaid on and after
the Effective Date, (b) increasing any applicable interest rate, (c)
accelerating any date specified for a required prepayment or repayment of
principal of any Senior Note, (d) increasing the amount of any required
prepayment or repayment of principal of any Senior Note, or (e) increasing
the obligations of any guarantor of any obligations under any Note Purchase
Agreement, any Senior Note or other Senior Note Paper. CAFS shall not become
a party to or be obligated in any manner with respect to any Note Purchase
Agreement, Senior Note or other Senior Note Paper.
5.19. SWAP EXPOSURE. Parent shall not, and shall not permit any of its
Subsidiaries to, enter into or become liable in respect of any Interest Hedge
Agreement pursuant to which the aggregate notional amount (together with the
aggregate notional amount of all other Interest Hedge Agreements) exceeds the
aggregate principal amount of all Advances.
5.20. CAFS.
(a) No Subsidiary of Parent (other than CAFS), whether now or hereafter
existing or acquired, shall be liable at any time in any manner for any
obligation, now or hereafter existing, of CAFS, including, but not limited to,
by way of any guarantee of obligations of CAFS, any agreement to acquire any
debt or equity of CAFS, assume any liability or acquire any asset of CAFS, or
maintain the liquidity or net worth of CAFS, or substantive consolidation or
similar equitable remedy.
(b) Parent shall not be liable at any time for any CAFS Liability;
PROVIDED, Parent may (i) acquire for cash equity of CAFS (in addition to all
equity of CAFS owned by Parent on December 3, 1996), and (ii) execute and
perform under the CAFS Guaranty, or (iii) do any combination of activities
described in CLAUSES (i) and (ii); PROVIDED, FURTHER, the sum of (A) the
aggregate gross cash purchase price of equity acquired on and prior to
December 3, 1996 and pursuant to CLAUSE (i), plus (B) the aggregate amount
for which Parent may be liable under the CAFS Guaranty, plus (C) the aggregate
amount paid by Parent and the fair market value of property of Parent
transferred with respect to all other CAFS Liabilities, plus (D) the
aggregate amount of all other liabilities of Parent in respect of CAFS
Liabilities (valued based on the reasonable determination of Parent
(including in such valuation the probability of any claim maturing) or, if
Agent disagrees with any such determination, based on the reasonable
determination of Agent), shall not exceed at any time $8,000,000.
(c) CAFS shall not, and Parent shall not permit CAFS to, amend or restate
the CAFS Credit Agreement or any related agreement (other than the CAFS
Guaranty) if the effect of such amendment or restatement is to either increase
the amount for which Parent is liable pursuant to the CAFS Credit Agreement or
any related agreement or create any new liability of Parent not existing
pursuant to the CAFS Guaranty (as it existed on December 3, 1996). Parent shall
not amend or restate, or permit any amendment or restatement of, the CAFS
Guaranty; PROVIDED, Parent may terminate or reduce the amount of its obligations
pursuant to the CAFS Guaranty.
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5.21. SUBSIDIARIES AND OBLIGORS. Parent and CA Canada shall not permit
any of its Subsidiaries (other than CAFS) and Affiliates or any other Obligor to
violate any provision of this ARTICLE V, and Parent shall cause CAFS to comply
with those provisions of ARTICLE V expressly applicable to it.
5.22. INTERCOMPANY ADVANCES. Neither Parent nor any Guarantor or CAFS
shall make any loans, advances, extensions of credit, investments in equity or
otherwise to CA Canada such that the total amount outstanding of such advances,
extensions of credit or investments at any one time shall be in excess of
$10,000,000.
5.23. CAFS. Notwithstanding anything contained herein to the
contrary, any calculation under SECTIONS 5.01, 5.02, 5.03, 5.04, 5.05 hereof,
each of the assets, liabilities and results of operations of CAFS shall be
excluded; provided, further that notwithstanding such exclusion, Parent must
include in such calculation all liabilities, including Contingent Liabilities,
of Parent and each Subsidiary of Parent other than CAFS, for any obligation of
CAFS. For purposes of calculation of SECTION 5.03, Funded Debt should include
the lesser of $5,000,000 or the aggregate dollar amount of all obligations of
Obligors for Funded Debt of CAFS.
ARTICLE VI. AFFIRMATIVE COVENANTS
So long as the Commitment or any Advance or any Reimbursement Obligations
is outstanding, or Parent, CA Canada, or any other Obligor owes any other amount
hereunder or under any other Loan Paper:
6.01. PRESERVATION OF EXISTENCE AND SIMILAR MATTERS. Parent and CA
Canada each shall:
(a) preserve and maintain, or timely obtain and thereafter preserve,
maintain and comply with, their respective existence, Rights, franchises,
Licenses, authorizations, consents, privileges and all other authorizations from
any Tribunal, the loss of which could have a Material Adverse Change; and
(b) qualify and remain qualified and authorized to do business in each
jurisdiction in which the character of their respective Properties or the nature
of its business requires such qualification or authorization, except where the
failure to be so qualified and authorized would not result in a Material Adverse
Change.
6.02. LICENSES AND MATERIAL AGREEMENTS. Parent and CA Canada shall
maintain and comply in all material respects with all agreements necessary for
it to own, maintain, or operate any of its businesses or Properties.
6.03. COMPLIANCE WITH LAWS. Parent and CA Canada shall comply in all
material respects with all applicable Laws.
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6.04. MAINTENANCE OF PROPERTIES. Parent and CA Canada shall maintain
or cause to be maintained all its Properties in good repair, working order and
condition, taken as a whole, ordinary wear and tear excepted, and from time to
time make or cause to be made all appropriate repairs, renewals, replacements,
additions, betterments and improvements thereto.
6.05. PAYMENT OF TAXES AND OTHER INDEBTEDNESS. Parent and CA Canada
will pay and discharge (a) before penalty all Taxes, (b) when due all lawful
claims (including claims for labor, materials and supplies), which, if unpaid,
might give rise to a Lien upon any of its property, except to the extent
contested in good faith and for which adequate reserves have been established
therefor in accordance with GAAP, and (c) when due all of its other Debt,
obligations and liabilities to the extent that the failure to so pay would
result in an Event of Default described in SECTION 7.01(I), except as prohibited
hereunder.
6.06. ERISA COMPLIANCE. Parent and CA Canada will (a) make prompt
payment of all contributions required under all Plans, and (b) notify Agent
immediately if (i) there is a "complete withdrawal" or "partial withdrawal" (as
described in ERISA Sections 4203 and 4205, respectively) by Parent, CA Canada or
any ERISA Affiliate of Parent or CA Canada from a Multiemployer Plan, (ii)
Parent, CA Canada or any ERISA Affiliate of Parent or of CA Canada is in
"default" (as defined in ERISA Section 4219 (c) (5)) with respect to payments to
a Multiemployer Plan required by reason of its complete or partial withdrawal
from such Plan, (iii) a Multiemployer Plan of Parent or CA Canada is in
"reorganization" (as described in Internal Revenue Code Section 418 or in Title
IV of ERISA) or has "terminated" (as described in ERISA Section 4041A), or (iv)
there is an action brought against Parent, CA Canada, or any ERISA Affiliate for
failure to make contributions as required by ERISA Section 515.
6.07. INSURANCE. Parent and CA Canada shall:
(a) OBTAIN AND MAINTAIN INSURANCE. Maintain and keep in force the
following policies of insurance:
(i) HAZARD INSURANCE. Insurance against loss or damage to each
Facility by fire and any of the risks covered by insurance of the type now
known as "all risk coverage," in an aggregate amount satisfactory to Agent
and Canadian Agent or the full replacement cost of the Facility, including,
without limitation, the cost of debris removal (exclusive of the cost of
excavations, foundations, and footings below the lowest basement floor),
whichever is greater; and a deductible from the loss payable for any
casualty not to exceed $25,000 per occurrence, unless a higher amount is
required by Applicable Law. The policies of insurance carried in
accordance with this SECTION 6.07(a)(i) shall contain the "Replacement Cost
Endorsement" and an "Agreed Amount Endorsement";
(ii) BUSINESS INTERRUPTION INSURANCE. Business interruption
insurance in the minimum amount equal to Parent's and CA Canada's Net
Income for the preceding fiscal year divided by four;
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(iii) PERSONAL PROPERTY INSURANCE. Insurance against loss or
damage to any personal property of Parent, CA Canada, and their respective
Subsidiaries by fire and other risks covered by insurance of the type now
known as "all risk coverage";
(iv) PUBLIC LIABILITY INSURANCE. Comprehensive public liability
insurance (including, without limitation, coverage for elevators and
escalators) on an "occurrence basis" against claims for "personal injury",
including, without limitation, bodily injury, death or property damage
occurring on, in or about the Facility and the adjoining streets, sidewalks
and passageways, such insurance to afford immediate minimum protection to a
limit of not less than $10,000,000 for bodily injury and property damage
for any single occurrence;
(v) WORKERS' COMPENSATION INSURANCE. Either or a combination of
workers' compensation insurance (including, without limitation, employer's
liability insurance) or a program of self-insurance (if permitted by
Applicable Law) for all employees of Parent, CA Canada, and their
respective Subsidiaries required to be covered by Applicable Law in such
amount as is generally carried in accordance with sound business practice
by companies in similar businesses similarly situated, or, if higher limits
are established by Applicable Law, then in such amounts; and
(vi) OTHER INSURANCE. Such other insurance, and in such amounts,
as may be required by any Tribunal having jurisdiction with respect thereto
or as is carried generally in accordance with sound business practice by
companies in businesses similarly situated or as may be reasonably required
from time to time by Agent or Canadian Agent.
(b) GENERAL INSURANCE PROVISIONS. Cause all policies of insurance
required by the provisions of SECTION 6.07(a) to:
(i) Contain an endorsement or agreement by the insurer that any
loss shall be payable in accordance with the terms of such policy
notwithstanding any act or negligence of the insured which might otherwise
result in forfeiture of said insurance and the further agreement of the
insurer waiving all rights of setoff, counterclaim or deductions against
the insured;
(ii) Be issued by companies having an A.M. Best Co.
policyholder's rating of "A" or better and a financial size category of "V"
or better. Insurance carriers with lesser ratings are acceptable if they
present a reinsurance agreement containing a direct access clause with a
company or companies that meet such rating requirement. Coverage amounts
shall not exceed 5% of carrier surplus and capital values unless approved
in writing by Agent or reinsurance is carried;
(iii) Be issued by carriers that are fully and properly licensed
in each appropriate State or Province; and
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(iv) Otherwise be in form and substance satisfactory to Agent and
Canadian Agent.
(c) EVIDENCE OF INSURANCE. Furnish Agent or Canadian Agent with an
original copy of all policies of required insurance. The required insurance may
be provided through one or more blanket policies carried by Parent, CA Canada,
and covering more than one location, in which event Parent and CA Canada shall
furnish Agent or Canadian Agent with a certificate of insurance for each such
policy setting forth the coverage, the limits of liability, the name of the
carrier, the policy number, and the expiration date and, if requested by Agent
or Canadian Agent, a certified copy of the blanket policy or policies. Parent
and CA Canada shall also furnish or cause to be furnished to Agent or Canadian
Agent (i) no later than fifteen Business Days before the applicable renewal date
a copy of all binders of coverage, on which binders are indicated the terms of
payment, deductibles, policy amounts and other relevant information, and (ii)
within ten Business Days after each such renewal date, evidence of the payment
of all premiums payable in connection with such renewal. Within ninety days
after the end of each fiscal year, Parent and CA Canada shall deliver to Agent
or Canadian Agent a report describing all insurance coverage of Parent and CA
Canada.
6.08. INSPECTION RIGHTS. Parent and CA Canada shall permit Agent or
Canadian Agent, upon reasonable notice and during normal business hours, to
examine and make copies of and abstracts from its records and books of account,
to visit and inspect its Properties and to discuss its affairs, finances, and
accounts with any of its officers or accountants, all as Agent or Canadian Agent
may request.
6.09. RECORDS AND BOOKS OF ACCOUNT; CHANGES IN GAAP. Parent and CA
Canada shall keep adequate records and books of account in conformity with GAAP.
6.10. REPORTING REQUIREMENTS. Parent shall furnish to Agent and each
Lender:
(a) As soon as available and in any event within forty-five days after the
end of each fiscal quarter, the consolidated and consolidating balance sheet of
Parent and its Subsidiaries as at the end of such fiscal quarter, and the
consolidated and consolidating statements of income, changes in shareholders'
equity and changes in cash flow of Parent and its Subsidiaries for such fiscal
quarter and for the portion of the fiscal year ending with such fiscal quarter,
setting forth, in comparative form, results for the corresponding periods in the
previous fiscal year, all in reasonable detail, and certified by an officer of
Parent acceptable to Agent as prepared in accordance with GAAP, and fairly
presenting the financial condition and results of operations of Parent and its
respective Subsidiaries (subject to changes resulting from an audit and normal
year-end adjustments);
(b) As soon as available and in any event within ninety days after the end
of each fiscal year of Parent, a consolidated and consolidating balance sheet of
Parent, and their respective Subsidiaries as at the end of such fiscal year, and
consolidated and consolidating statements of
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income, changes in shareholders' equity, and changes in cash flow of Parent
and its Subsidiaries for such fiscal year, all in reasonable detail, prepared
in accordance with GAAP, and accompanied by an unqualified opinion of
Auditor, which opinion shall state that said financial statements were
prepared in accordance with GAAP, that the examination by Auditor in
connection with such financial statements was made in accordance with
generally accepted auditing standards, and that said financial statements
present fairly the financial condition and results of operations of Parent
and its Subsidiaries;
(c) Promptly upon the first to occur of their becoming available or their
filing with the appropriate Tribunal, a copy of each Form 10-Q for each fiscal
quarter, each Form 10-K for each fiscal year, if required to be prepared under
Regulation 14a-3, promulgated by the Securities and Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended, a copy of Parent's proxy
materials provided to its shareholders, financial statement, report, notice,
proxy statement, regular, periodic or special report, registration statement,
prospectus, and all other information, and all amendments thereto, together with
all exhibits and schedules to each of the foregoing, filed by Parent or any of
its Subsidiaries with the Securities and Exchange Commission or any similar
Tribunal, or otherwise provided to holders of securities issued by Parent or any
of its Subsidiaries;
(d) Promptly upon receipt thereof, copies of all material reports or
letters submitted to Parent by Auditor or any other accountants in connection
with any annual, interim, or special audit, including without limitation the
comment letter submitted to management in connection with any such audit;
(e) Together with each set of financial statements delivered pursuant to
SECTION 6.10(a) and (b), a Compliance Certificate (with calculations for the
365-day period ended on such fiscal quarter end);
(f) As soon as available and in any event within thirty days after the end
of each month, a Borrowing Base Certificate for such month;
(g) As soon as possible and in any event within two Business Days after
knowledge by an officer of Parent of the occurrence of any Default or Event of
Default, a notice from an officer of Parent acceptable to Agent, setting forth
the details of such Default or Event of Default, and the action being taken or
proposed to be taken with respect thereto;
(h) (i) As soon as possible and in any event within two days after
knowledge thereof by an officer of Parent, notice of any Litigation pending or
threatened against Parent or any Obligor which, if determined adversely, could
result in judgment, penalties, or damages equal to or in excess of $2,000,000,
together with a statement of an officer of Parent acceptable to Agent,
describing the allegations of such Litigation, and the action being taken or
proposed to be taken with respect thereto, (ii) within ninety days after the end
of each fiscal year, complete reports by counsel to Parent and each Obligor,
describing all Litigation of Parent and each Obligor, and (iii)
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within forty-five days after each fiscal quarter in which a material change
in reported Litigation of the nature described above has occurred or
additional Litigation has been threatened or commenced, reports by counsel to
Parent and each Obligor, describing such material changes in or additions to
the last annual Litigation report;
(i) As soon as possible and in any event within two days after knowledge
thereof by an officer of Parent, notice of any claimed default, actual default
or the occurrence of any event or existence of any condition the effect of which
is to cause or permit the acceleration of any Debt of or secured by any assets
of any Obligor, with respect to Debt in the aggregate amount equal to or in
excess of $2,000,000;
(j) Promptly after filing or receipt thereof by an officer of Parent,
copies of all reports and notices that Parent, any of its Subsidiaries and
Affiliates and each Obligor (i) files or receives in respect of any Plan with or
from the Internal Revenue Service, the PBGC, or the United States Department of
Labor, or (ii) furnishes to or receives from any holders of any Debt or
Contingent Liability that is not duplicative of, or subsumed in, reports or
notices provided to Agent or Lenders hereunder, if in the case of CLAUSES (i)
and (ii), any information or dispute referred to therein could result in a
Default or an Event of Default;
(k) Parent will notify Agent or Canadian Agent, as applicable, in writing,
promptly upon Parent learning, of any of the following which has a reasonable
likelihood of resulting in liability in excess of $500,000:
(i) each Environmental Claim which Parent receives, including
one to take any remedial, removal or other action with respect to any Hazardous
Materials contained on any property, whether or not owned by Parent;
(ii) each notice of violation of any Environmental Law; and
(iii) each commencement of any judicial or administrative
proceeding or investigation concerning an Environmental Claim with respect to
Parent;
(l) As soon as possible and in any event within five days after knowledge
thereof by an officer of Parent, notice of any act, event or circumstance which
could reasonably be foreseen to cause or result in a Material Adverse Change to
either of Borrowers, together with a statement of an officer of Parent
acceptable to Agent, describing the circumstances surrounding the same, and the
action being taken or proposed to be taken with respect thereto;
(m) As soon as possible and in any event within five days after the
occurrence thereof, notice of any requested amendment or restatement and any
effective amendment or restatement of any Note Purchase Agreement, any Senior
Note or any other Senior Note Paper, and any assignment of any Senior Note or
any other Senior Note Paper, together with copies of each document related
thereto;
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(n) Promptly upon written request, such other information concerning the
condition or operations of Parent or any other Obligor, financial or otherwise,
as Agent may from time to time request;
(o) After any reallocation pursuant to SECTION 2.17 herein and such
Canadian Advances from ABN equal or exceed CDN$10,000,000, Borrowers must
deliver on a monthly basis to Agent a certificate demonstrating that the total
of all Advances from ABN, converted into Dollars does not exceed $10,000,000.
At any such time as the amount of outstanding Canadian Advances from ABN exceeds
$10,000,000 as set forth in the certificate delivered pursuant hereto, CA Canada
shall prepay the amount of such excess, the amount of such excess to be applied
to ABN's portion of Canadian Advances; and
(p) As soon as it is available and in any event within five days after the
effectiveness thereof, a complete copy of all agreements, and all amendments and
restatements thereof, with respect to Debt of CAFS, each securitization of any
asset of CAFS and each agreement with respect to the issuance of or any right to
acquire any capital stock or other equity interest of CAFS. As soon as possible
or in any event within two Business Days after knowledge by an officer of Parent
or CAFS of the occurrence of any default or event of default under any agreement
related to Debt of CAFS or any agreement related to securitization of any asset
of CAFS, a notice from an officer of Parent or CAFS acceptable to Agent, setting
forth the details of such default or event of default, and the action being
taken or proposed to be taken with respect thereto.
6.11. SOLVENCY. Each Obligor shall continue to be Solvent.
6.12. SUBSIDIARIES AND OBLIGOR. Parent and CA Canada shall cause each
of its Subsidiaries (other than CAFS) and Affiliates and each Obligor to comply
with each provision of this ARTICLE VI, and CAFS to comply with those provisions
of ARTICLE VI expressly applicable to it.
6.13. FURTHER ASSURANCES. Parent and CA Canada will make, execute or
endorse, and acknowledge and deliver or file or cause the same to be done, all
such vouchers, invoices, notices, certifications and additional agreements,
undertakings, or other assurances, and take any and all such other action, as
Agent may, from time to time, deem reasonably necessary or proper in connection
with any of the Loan Papers and the obligations of Parent and CA Canada
thereunder.
ARTICLE VII. EVENTS OF DEFAULT
7.01. EVENTS OF DEFAULT. Any one or more of the following shall be an
"Event of Default" hereunder, if the same shall occur for any reason whatsoever,
whether voluntary or involuntary, by operation of Law, or otherwise:
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(a) Parent shall fail to pay any principal, interest, fees or other
amounts payable under any Loan Paper on the date due;
(b) CA Canada shall fail to pay any principal, interest, fees or other
amounts payable under any Loan Paper on the date due;
(c) Any representation or warranty made or deemed made by any Obligor (or
any of its officers or representatives) under or in connection with any Loan
Paper shall prove to have been incorrect or misleading in any material respect
when made or deemed made;
(d) Any Obligor shall fail to perform or observe any term or covenant
contained in ARTICLE V;
(e) Any Obligor shall fail to perform or observe any other term or
covenant contained in any Loan Paper, other than those described in SECTION
7.01(a), (b), (c) and (d), and such failure shall not be remedied within (i)
thirty days following the earlier of knowledge thereof by such Obligor or an
officer of such Obligor, or of written notice by Agent to Parent, with respect
to any failure to perform or observe the provisions of SECTIONS 6.01, 6.02, 6.03
and 6.04, and (ii) ten Business Days following the earlier of knowledge thereof
by such Obligor or an officer of such Obligor, or of written notice by Agent to
Parent, with respect to any other provision of any Loan Paper;
(f) Any Loan Paper or provision thereof shall, for any reason, not be
valid and binding on the Obligor signatory thereto or CAFS to the extent CAFS
signed such Loan Paper, or not be in full force and effect, or shall be declared
to be null and void; the validity or enforceability of any Loan Paper shall be
contested by any Obligor or CAFS; any Obligor or CAFS shall deny that it has any
or further liability or obligation under its respective Loan Papers; or any
default or breach under any provision of any Loan Papers shall continue after
the applicable grace period, if any, specified in such Loan Paper;
(g) Any of the following shall occur: (i) any Obligor shall make an
assignment for the benefit of creditors or be unable to pay its debts generally
as they become due; (ii) any Obligor shall petition or apply to any Tribunal for
the appointment of a trustee, receiver, or liquidator of it, or of any
substantial part of its assets, or shall commence any proceedings relating to
any Obligor under any Debtor Relief Laws; (iii) any such petition or application
shall be filed, or any such proceedings shall be commenced, against any Obligor,
or an order, judgment or decree shall be entered appointing any such trustee,
receiver, or liquidator, or approving the petition in any such proceedings;
(iv) any final order, judgment, or decree shall be entered in any proceedings
against any Obligor decreeing its dissolution; or (v) any final order, judgment,
or decree shall be entered in any proceedings against any Obligor decreeing its
split-up which requires the divestiture of a substantial part of its assets;
(h) Any Event of Default (as defined in each Note Purchase Agreement)
shall occur;
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(i) Parent or any other Obligor shall fail to pay any (A) Funded Debt
(other than Debt under the Loan Papers or any Note Purchase Agreement) or
obligations in respect of Capital Leases (other than Debt under the Loan Papers
or any Note Purchase Agreement) in an aggregate amount of $5,000,000 or more
when due (whether by scheduled maturity, required prepayment, acceleration,
demand, or otherwise) or (B) other Debt (other than Debt under the Loan Papers
or any Note Purchase Agreement and Debt described in CLAUSE (A) immediately
preceding), except to matters being disputed or contested in good faith, in an
aggregate amount of $5,000,000 or more when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt (being the Debt described in either of
CLAUSES (A) or (B) immediately preceding); Parent or any other Obligor shall
fail to perform or observe any term or covenant contained in any agreement or
instrument relating to any such Debt, when required to be performed or observed,
and such failure shall continue after the applicable grace period, if any,
specified in such agreement or instrument, and can result in acceleration of the
maturity of such Debt; or any such Debt shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof;
(j) Any Obligor shall have any final judgment(s) outstanding against it
for the payment of $5,000,000 or more, and such judgment(s) shall remain
unstayed, in effect, and unpaid for the period of time after which the judgment
holder may and may cause the creation of Liens against or seizure of any of its
Property;
(k) Any ERISA Event shall have occurred with respect to a Plan of Parent,
and the sum of the Insufficiency of such Plan and liabilities relating thereto
is equal to or greater than $1,000,000; or Parent or any ERISA Affiliate of
Parent shall have committed a failure described in Section 302(f)(l) of ERISA,
and the amount determined under Section 302(f)(3) of ERISA is equal to or
greater than $5,000,000;
(l) Parent or any ERISA Affiliate of Parent shall have been notified by
the sponsor of a Multiemployer Plan that (A) it has incurred Withdrawal
Liability to such Plan in an amount that, exceeds $5,000,000 or requires
payments exceeding $1,000,000 per annum, or (B) such Plan is in reorganization
or is being terminated, within the meaning of Title IV of ERISA, if as a result
thereof the aggregate annual contributions to all Multiemployer Plans in
reorganization or being terminated is increased over the amounts contributed to
such Plans for the preceding Plan year by an amount exceeding $5,000,000;
(m) Any Obligor shall be required under any Environmental Law (i) to
implement any remedial, neutralization, or stabilization process or program, the
cost of which would constitute a Material Adverse Change, or (ii) to pay any
penalty, fine, or damages in an aggregate amount of $5,000,000 or more;
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(n) Any Property (whether leased or owned), or the operations conducted
thereon by any Obligor or any current or prior owner or operator thereof (in the
case of real Property), shall violate or have violated any applicable
Environmental Law, if such violation would constitute a Material Adverse Change;
or such Obligor shall not obtain or maintain any License required to be obtained
or filed under any Environmental Law in connection with the use of such Property
and assets, including without limitation past or present treatment, storage,
disposal, or release of Hazardous Materials into the environment, if the failure
to obtain or maintain the same would constitute a Material Adverse Change; or
(o) Any Obligor is found to have any liability in respect of any
obligations or business operations of CAFS not permitted pursuant to SECTION
5.20(b).
7.02. REMEDIES UPON DEFAULT. If an Event of Default described in
SECTION 7.01(g) shall occur with respect to any Obligor, the aggregate unpaid
principal balance of and accrued interest on all Advances shall, to the extent
permitted by Applicable Law, thereupon become due and payable concurrently
therewith, without any action by Agent, Canadian Agent, Issuing Bank, Canadian
Issuing Bank or any Lender, and without diligence, presentment, demand, protest,
notice of protest or intent to accelerate, or notice of any other kind, all of
which are hereby expressly waived. Subject to the foregoing sentence, if any
Event of Default shall occur and be continuing, Agent or Canadian Agent, as the
case may be at its election, do any one or more of the following:
(a) Declare the entire unpaid balance of all Domestic Advances or Canadian
Advances, as the case may be, immediately due and payable, whereupon it shall be
due and payable without diligence, presentment, demand, protest, notice of
protest or intent to accelerate, or notice of any other kind (except notices
specifically provided for under SECTION 7.01), all of which are hereby expressly
waived (except to the extent waiver of the foregoing is not permitted by
Applicable Law);
(b) Terminate the Domestic Commitment or the Canadian Commitment, as the
case may be;
(c) Enforce any Rights under SECTION 2.15(f) or SECTION 2.16(f);
(d) Reduce any claim of Agent, Canadian Agent, Issuing Bank, Canadian
Issuing Bank and Lenders to judgment; and
(e) Exercise any Rights afforded under any Loan Papers, by Law, including
but not limited to the UCC, at equity, or otherwise.
7.03. CUMULATIVE RIGHTS. All Rights available to Agent, Canadian
Agent, Issuing Bank, Canadian Issuing Bank and Lenders under the Loan Papers
shall be cumulative of and in addition to all other Rights granted thereto at
Law or in equity, whether or not amounts owing thereunder shall be due and
payable, and whether or not Agent, Canadian Agent, Issuing Bank, Canadian
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Issuing Bank or any Lender shall have instituted any suit for collection or
other action in connection with the Loan Papers.
7.04. WAIVERS. The acceptance by Agent, Canadian Agent, Issuing Bank,
Canadian Issuing Bank or any Lender at any time and from time to time of partial
payment of any amount owing under any Loan Papers shall not be deemed to be a
waiver of any Default or Event of Default then existing. No waiver by Agent,
Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender of any Default
or Event of Default shall be deemed to be a waiver of any Default or Event of
Default other than such Default or Event of Default. No delay or omission by
Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender in
exercising any Right under the Loan Papers shall impair such Right or be
construed as a waiver thereof or an acquiescence therein, nor shall any single
or partial exercise of any such Right preclude other or further exercise
thereof, or the exercise of any other Right under the Loan Papers or otherwise.
7.05. PERFORMANCE BY AGENT OR ANY LENDER. Should any covenant of any
Obligor fail to be performed in accordance with the terms of the Loan Papers,
Agent may, at its option, perform or attempt to perform such covenant on behalf
of such Obligor. Notwithstanding the foregoing, it is expressly understood that
none of Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender
assumes, and shall not ever have, except by express written consent of Agent,
Canadian Agent, Issuing Bank, Canadian Issuing Bank or such Lender, any
liability or responsibility for the performance of any duties or covenants of
any Obligor.
7.06. EXPENDITURES. Borrowers shall reimburse Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank and each Lender for any reasonable sums
spent by it in connection with the exercise of any Right provided herein. Such
sums shall bear interest at the lesser of (a) the greatest Base Rate (whether or
not in effect), plus 4.00% and (b) the Highest Lawful Rate, from the date spent
until the date of repayment by Borrowers.
7.07. CONTROL. None of the covenants or other provisions contained in
this Agreement shall, or shall be deemed to, give Agent, Canadian Agent, Issuing
Bank, Canadian Issuing Bank or any Lender any Rights to exercise control over
the affairs and/or management of any Obligor, the power of Agent, Canadian
Agent, Issuing Bank, Canadian Issuing Bank and each Lender being limited to the
Rights to exercise the remedies provided in this Article; PROVIDED, HOWEVER,
that if Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender
becomes the owner of any partnership, stock or other equity interest in any
Person, whether through foreclosure or otherwise, it shall be entitled to
exercise such legal Rights as it may have by being an owner of such stock or
other equity interest in such Person.
7.08. CAFS. For purposes of SECTION 7.01(g) only, "Obligor" shall be
deemed to include CAFS.
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ARTICLE VIII. THE AGENT AND CANADIAN AGENT
8.01. AUTHORIZATION AND ACTION. Each Lender and Issuing Bank hereby
appoints and authorizes Agent to take such action as Agent on its behalf and to
exercise such powers under this Agreement and the other Loan Papers as are
delegated to the Agent by the terms of the Loan Papers, together with such
powers as are reasonably incidental thereto. As to any matters not expressly
provided for by this Agreement and the other Loan Papers (including without
limitation enforcement or collection of the Notes), Agent shall not be required
to exercise any discretion or take any action, but shall be required to act or
to refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of Determining Lenders (or all Lenders, if
required under SECTION 9.01), and such instructions shall be binding upon all
Lenders and Issuing Bank; PROVIDED, HOWEVER, that Agent shall not be required to
take any action which exposes Agent to personal liability or which is contrary
to any Loan Papers or Applicable Law. Agent agrees to give to each Lender and
Issuing Bank notice of each notice given to it by Parent pursuant to the terms
of this Agreement, and to distribute to each applicable Lender and Issuing Bank
in like funds all amounts delivered to Agent by Parent for the Ratable or
individual account of any Lender or Issuing Bank, as appropriate. Each Canadian
Lender and Canadian Issuing Bank hereby appoints and authorizes Canadian Agent
to take such action as Canadian Agent on its behalf and to exercise such powers
under this Agreement and the other Loan Papers as are delegated to the Canadian
Agent by the terms of the Loan Papers, together with such powers as are
reasonably incidental thereto. Canadian Agent agrees to give to each Canadian
Lender and Canadian Issuing Bank notice of each notice given to it by CA Canada
pursuant to the terms of this Agreement, and to distribute to each applicable
Canadian Lender and Canadian Issuing Bank in like funds all amounts delivered to
Canadian Agent by CA Canada for the Ratable or individual account of any
Canadian Lender or Canadian Issuing Bank, as appropriate.
8.02. AGENT'S RELIANCE, ETC. Neither Agent, Canadian Agent, nor any of
their directors, officers, agents, employees, or representatives shall be liable
for any action taken or omitted to be taken by it or them under or in connection
with this Agreement or any other Loan Paper, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, Agent and Canadian Agent (a) may treat the payee of any Note as the
holder thereof until Agent or Canadian Agent receives written notice of the
assignment or transfer thereof signed by such payee and in form satisfactory to
Agent or Canadian Agent, as the case may be; (b) may consult with legal counsel
(including counsel for Parent, CA Canada, or any of their respective
Subsidiaries), independent public accountants, and other experts selected by it,
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants, or
experts; (c) makes no warranty or representation to any Lender, Issuing Bank,
Canadian Issuing Bank and shall not be responsible to any Lender, Issuing Bank,
or Canadian Issuing Bank for any statements, warranties, or representations made
in or in connection with this Agreement or any other Loan Papers; (d) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants, or conditions of this Agreement or any other Loan
Papers on the part of any Obligor or its Subsidiaries or to inspect the Property
(including the books and records) of any Obligor or its Subsidiaries; (e) shall
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not be responsible to any Lender, Issuing Bank, or Canadian Issuing Bank for the
due execution, legality, validity, enforceability, genuineness, sufficiency, or
value of this Agreement, any other Loan Papers, or any other instrument or
document furnished pursuant hereto; and (f) shall incur no liability under or in
respect of this Agreement or any other Loan Papers by acting upon any notice,
consent, certificate, or other instrument or writing believed by it to be
genuine and signed or sent by the proper party or parties.
8.03. NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, CANADIAN IMPERIAL
BANK OF COMMERCE AND AFFILIATES. With respect to its Commitment, its Advances,
and any Loan Papers, NationsBank of Texas, National Association and the Canadian
Imperial Bank of Commerce have the same Rights under this Agreement as any other
Lender and may exercise the same as though it were not Agent or Canadian Agent.
NationsBank of Texas, National Association, the Canadian Imperial Bank of
Commerce and their Affiliates may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any kind of business with,
any Obligor, any Affiliate thereof, and any Person who may do business
therewith, all as if NationsBank of Texas, National Association or the Canadian
Imperial Bank of Commerce were not Agent or Canadian Agent respectively, and
without any duty to account therefor to any Lender.
8.04. LENDER CREDIT DECISION. Each Lender, Issuing Bank and Canadian
Issuing Bank acknowledges that it has, independently and without reliance upon
Agent, Canadian Agent, any other Lender, Issuing Bank, or Canadian Issuing Bank,
and based on the financial statements referred to in SECTION 4.04 and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender, Issuing Bank
and Canadian Issuing Bank also acknowledges that it will, independently and
without reliance upon Agent, Canadian Agent, any other Lender, Issuing Bank, or
Canadian Issuing Bank and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Papers.
8.05. INDEMNIFICATION BY LENDERS. LENDERS SHALL INDEMNIFY AGENT AND
CANADIAN AGENT, PRO RATA, FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS,
LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES, OR
DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED
BY, OR ASSERTED AGAINST AGENT IN ANY WAY RELATING TO OR ARISING OUT OF ANY LOAN
PAPERS OR ANY ACTION TAKEN OR OMITTED BY AGENT OR CANADIAN AGENT THEREUNDER,
INCLUDING ANY NEGLIGENCE OF AGENT OR CANADIAN AGENT; PROVIDED, HOWEVER, THAT NO
LENDER SHALL BE LIABLE FOR ANY PORTION OF SUCH LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES, OR DISBURSEMENTS
RESULTING FROM AGENT'S OR CANADIAN AGENT'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. Without limitation of the foregoing, Lenders shall reimburse Agent
or Canadian Agent, as the case may be, Pro Rata, promptly upon demand for any
out-of-pocket expenses
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(including reasonable attorneys' fees) incurred by Agent or Canadian Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment, or enforcement (whether through negotiation, legal
proceedings or otherwise) of, or legal and other advice in respect of rights
or responsibilities under, the Loan Papers. Agent or Canadian Agent, as the
case may be, may make demand for any amounts claimed to be due under this
SECTION 8.05 on and after the third Business Day after Parent or any other
Obligor has failed or refused to pay the full amount demanded. The indemnity
provided in this SECTION 8.05 shall survive the termination of this Agreement.
8.06. SUCCESSOR AGENT. Agent may resign at any time by giving written
notice thereof to Lenders, Issuing Bank, Canadian Issuing Bank, Parent, and CA
Canada and may be removed at any time with or without cause by the action of all
Lenders (other than Agent, if it is a Lender). Upon any such resignation,
Determining Lenders shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed and shall have accepted such
appointment within thirty days after the retiring Agent's giving of notice of
resignation, then the retiring Agent may, on behalf of Lenders, appoint a
successor Agent, which shall be a commercial bank organized under the Laws of
the United States of America or of any State thereof and having a combined
capital and surplus of at least $50,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the Rights and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Loan Papers, provided that if the retiring or removed
Agent is unable to appoint a successor Agent, Agent shall, after the expiration
of a sixty day period from the date of notice, be relieved of all obligations as
Agent hereunder. Notwithstanding any Agent's resignation or removal hereunder,
the provisions of this ARTICLE VIII shall continue to inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement.
8.07 SUCCESSOR CANADIAN AGENT. Canadian Agent may resign at any time
by giving written notice thereof to Lenders, Issuing Bank, Canadian Issuing
Bank, Parent, and CA Canada and may be removed at any time with or without
cause by the action of all Lenders (other than Canadian Agent, if it is a
Lender). Upon any such resignation, Determining Lenders shall have the right
to appoint a successor Canadian Agent. If no successor Canadian Agent shall
have been so appointed and shall have accepted such appointment within thirty
days after the retiring Canadian Agent's giving of notice of resignation,
then the retiring Canadian Agent may, on behalf of Lenders, appoint a
successor Canadian Agent, which shall be a commercial bank organized under
the Laws of the dominion of Canada or of any Province thereof and having a
combined capital and surplus of at least CDN$50,000,000. Upon the acceptance
of any appointment as Canadian Agent hereunder by a successor Canadian Agent,
such successor Canadian Agent shall thereupon succeed to and become vested
with all the Rights and duties of the retiring Canadian Agent, and the
retiring Canadian Agent shall be discharged from its duties and obligations
under the Loan Papers, provided that if the retiring or removed Canadian
Agent is unable to appoint a successor Canadian Agent, Canadian Agent shall,
after the expiration of a sixty day period from the date of notice, be
relieved of all obligations as Canadian Agent hereunder. Notwithstanding
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any Canadian Agent's resignation or removal hereunder, the provisions of this
ARTICLE VIII shall continue to inure to its benefit as to any actions taken
or omitted to be taken by it while it was Canadian Agent under this Agreement.
ARTICLE IX. MISCELLANEOUS
9.01. AMENDMENTS AND WAIVERS. No amendment or waiver of any provision
of this Agreement or any other Loan Papers, nor consent to any departure by
Parent, any Obligor or CAFS therefrom, shall be effective unless the same shall
be in writing and signed by Agent and the Canadian Agent with the consent of
the Determining Lenders, 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 amendment, waiver, or consent shall (and the result
of action or failure to take action shall not) unless in writing and signed by
all of Lenders, Agent and Canadian Agent, (a) increase the Commitment,
(b) reduce any principal, interest, fees, or other amounts payable hereunder, or
waive or result in the waiver of any Event of Default under SECTION 7.01(a),
(c) postpone any date fixed for any payment of principal, interest, fees, or
other amounts payable hereunder, (d) release any collateral or guaranties
securing any Obligor's obligations hereunder, other than releases contemplated
hereby and by the Loan Papers, (e) change the meaning of Specified Percentage or
the number of Lenders required to take any action hereunder, or (f) amend this
SECTION 9.01 or SECTION 9.03. No amendment, waiver, or consent shall affect the
Rights, duties, or obligations of Agent under any Loan Papers, unless it is in
writing and signed by Agent in addition to the requisite number of Lenders. No
amendment, waiver, or consent shall affect the Rights, duties, or obligations of
Issuing Bank or Canadian Issuing Bank under any Loan Papers, unless it is in
writing and signed by Issuing Bank or Canadian Issuing Bank, as the case may be,
in addition to the requisite number of Lenders.
9.02. NOTICES.
(a) MANNER OF DELIVERY. All notices communications and other materials to
be given or delivered under the Loan Papers shall, except in those cases where
giving notice by telephone is expressly permitted, be given or delivered in
writing. All written notices, communications and materials shall be sent by
registered or certified mail, postage prepaid, return receipt requested, by
telecopier, or delivered by hand. In the event of a discrepancy between any
telephonic notice and any written confirmation thereof, such written
confirmation shall be deemed the effective notice except to the extent Agent,
Canadian Agent, any Lender, Issuing Bank, Canadian Issuing Bank, Parent or CA
Canada has acted in reliance on such telephonic notice.
(b) ADDRESSES. All notices, communications and materials to be given or
delivered pursuant to this Agreement (other than those required under Article
II) shall be given or delivered at the following respective addresses and
telecopier and telephone numbers and to the attention of the following
individuals or departments:
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(a) If to Parent:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Building Products, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Jr.
with a copy to: Mr. ▇▇▇▇ ▇▇▇▇▇
(b) If to CA Canada:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Canada, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
with a copy to: Mr. ▇▇▇▇ ▇▇▇▇▇
(c) If to Agent or Issuing Bank:
NationsBank of Texas, National Association
NationsBank Plaza
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇
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(d) If to Canadian Agent or Canadian Issuing Bank:
CANADIAN IMPERIAL BANK OF COMMERCE
▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
(e) If to any Lender, to its address shown on SCHEDULE 9.02
or at such other address or, telecopier or telephone number or to the attention
of such other individual or department as the party to which such information
pertains may hereafter specify for the purpose in a notice to the other
specifically captioned "Notice of Change of Address".
(c) EFFECTIVENESS. Each notice, communication and any material to be
given or delivered to any party pursuant to this Agreement shall be effective or
deemed delivered or furnished (i) if sent by mail, on the fifth day after such
notice, communication or material is deposited in the mail, addressed as above
provided, (ii) if sent by telecopier, when such notice, communication or
material is transmitted to the appropriate number determined as above provided
in this SECTION 9.02 and the appropriate receipt is received or otherwise
acknowledged, (iii) if sent by hand delivery or overnight courier, when left at
the address of the addressee addressed as above provided, and (iv) if given by
telephone, when communicated to the individual or any member of the department
specified as the individual or department to whose attention notices,
communications and materials are to be given or delivered except that notices of
a change of address, telecopier or telephone number or individual or department
to whose attention notices, communications and materials are to be given or
delivered shall not be effective until received; PROVIDED, HOWEVER, that notices
to Agent and Canadian Agent pursuant to ARTICLE II shall be effective when
received. Parent and CA Canada agree that Agent and Canadian Agent shall have
no duty or obligation to verify or otherwise confirm telephonic notices given
pursuant to ARTICLE II, and AGREE TO INDEMNIFY AND HOLD HARMLESS AGENT, CANADIAN
AGENT, ISSUING BANK, CANADIAN ISSUING BANK AND LENDERS FOR ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
CLAIMS, COSTS, AND EXPENSES RESULTING, DIRECTLY OR INDIRECTLY, FROM ACTING UPON
ANY SUCH NOTICE.
9.03. PARTIES IN INTEREST. All covenants and agreements contained in
this Agreement and all other Loan Papers shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto. Each Lender may
from time to time assign or transfer its interests hereunder pursuant to SECTION
9.04. No Obligor may assign or transfer any of its Rights or obligations
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hereunder without the prior written consent of Lenders and, if such Rights or
obligation relate to any Letter of Credit, the Letter of Credit Facility, any
Canadian Letter of Credit or the Canadian Letter of Credit Facility, Issuing
Bank or Canadian Issuing Bank, as the case may be.
9.04. ASSIGNMENTS AND PARTICIPATIONS.
(a) Each Lender (an "ASSIGNOR") may assign its Rights and obligations as a
Lender under the Loan Papers to one or more Eligible Assignees pursuant to an
Assignment and Acceptance, so long as (i) each assignment shall be of a
constant, and not a varying percentage of all Rights and obligations thereunder,
(ii) each Assignor shall obtain in each case the prior written consent of Agent
or Canadian Agent, as the case may be, and Parent and CA Canada (iii) each
Assignee shall in each case pay a $2,500 processing fee to Agent or Canadian
Agent, as the case may be, and (iv) no such assignment is for an amount less
than $5,000,000. Within five Business Days after Agent or Canadian Agent
receives notice of any such assignment, Parent and CA Canada shall execute and
deliver to Agent or Canadian Agent, in exchange for the Notes issued to
Assignor, new Notes to the order of such Assignor and its assignee in amounts
equal to their respective Specified Percentages of the Commitment. Such new
Notes shall be dated the effective date of the assignment. It is specifically
acknowledged and agreed that on and after the effective date of each assignment,
the assignee shall be a party hereto and shall have the Rights and obligations
of a Lender under the Loan Papers.
(b) Each Lender may sell participations to one or more Persons in all or
any of its Rights and obligations under the Loan Papers; PROVIDED, HOWEVER, that
(i) such Lender's obligations under the Loan Papers shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Lender shall remain the holder
of its Notes for all purposes of the Loan Papers, (iv) the participant shall be
granted the Right to vote on or consent to only those matters described in
SECTIONS 9.01(a), (b), (c), (d), (e) and (f), (v) each Obligor, Agent, Canadian
Agent, Issuing Bank, Canadian Issuing Bank and other Lenders shall continue to
deal solely and directly with such Lender in connection with its Rights and
obligations under the Loan Papers, and (vi) no such participation is for an
amount less than $5,000,000.
(c) Any Lender may, in connection with any assignment or participation, or
proposed assignment or participation, disclose to the assignee or participant,
or proposed assignee or participant, any information relating to any Obligor
furnished to such Lender by or on behalf of any Obligor.
(d) Notwithstanding any other provision set forth in this Agreement, (i)
any Lender may at any time create a security interest in all or any portion of
its Rights under this Agreement (including, without limitation, the Advances
owing to it and the Notes held by it) in favor of any Federal Reserve Bank in
accordance with Regulation A of the Board of Governors of the Federal Reserve
System, and (ii) no participant of any Lender may further assign or participate
any of its
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interest in the Loan Papers to any Person (except as may be required by Law
or a Tribunal having authority over such participant).
9.05. SHARING OF PAYMENTS. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any Right of set-off,
or otherwise) on account of its Advances in excess of its Pro Rata share of
payments made by either of Borrowers, such Lender shall forthwith purchase
participations in Advances made by the other Lenders as shall be necessary to
share the excess payment Pro Rata with each of them; PROVIDED, HOWEVER, that if
any of such excess payment is thereafter recovered from the purchasing Lender,
its purchase from each Lender shall be rescinded and each Lender shall repay the
purchase price to the extent of such recovery together with a Pro Rata share of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. Borrowers agree that any Lender so purchasing
a participation from another Lender pursuant to this SECTION 9.05 may, to the
fullest extent permitted by Law, exercise all its Rights of payment (including
the Right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of each of Borrowers in the amount of such
participation.
9.06. RIGHT OF SET-OFF. Upon the occurrence and during the continuance
of any Event of Default, Agent, Canadian Agent, Issuing Bank, Canadian Issuing
Bank and each Lender is hereby authorized at any time and from time to time, 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 and
other indebtedness at any time owing by Agent, Canadian Agent, Issuing Bank,
Canadian Issuing Bank or such Lender to or for the credit or the account of
Parent or CA Canada against any and all of the obligations of Parent or CA
Canada now or hereafter existing under this Agreement and the other Loan Papers,
whether or not Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any
Lender shall have made any demand under this Agreement or the other Loan Papers,
and even if such obligations are unmatured. Each of Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank and each Lender shall promptly notify
Borrowers after any such set-off and application, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The Rights of Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank and
each Lender under this SECTION 9.06 are in addition to other Rights (including,
without limitation, other Rights of set-off) which Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank and such Lender may have.
9.07. COSTS, EXPENSES, AND TAXES.
(a) Borrowers agree severally to pay on demand (i) all costs and expenses
(including reasonable attorneys' fees and expenses) of Agent and Canadian Agent
in connection with the preparation, negotiation, administration, interpretation,
modification, amendment, waiver, and release of all Loan Papers, and (ii) all
costs and expenses (including reasonable attorneys' fees and expenses) of Agent,
Canadian Agent, Issuing Bank, Canadian Issuing Bank and each Lender in
connection with any restructuring, work-out, or collection of any portion of the
Obligations or the enforcement of any Loan Papers.
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(b) In addition, Borrowers shall pay any and all stamp, debt, and other
Taxes payable or determined to be payable in connection with any payment
hereunder (other than Taxes on the overall net income of Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank or any Lender or franchise Taxes or Taxes on
capital or capital receipts of Agent, Canadian Agent, Issuing Bank, Canadian
Issuing Bank or any Lender), or the execution, delivery, or recordation of any
Loan Papers, and agrees to save Agent, Canadian Agent, Issuing Bank, Canadian
Issuing Bank and each Lender harmless from and against any and all liabilities
with respect to, or resulting from any delay in paying or omission to pay any
Taxes in accordance with this SECTION 9.07, including any penalty, interest, and
expenses relating thereto. All payments by Borrowers or any Subsidiary of
either of Borrowers under any Loan Papers shall be made free and clear of and
without deduction for any present or future Taxes (other than Taxes on the
overall net income of Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank
or any Lender of any nature now or hereafter existing, levied, or withheld, or
franchise Taxes or Taxes on capital or capital receipts of Agent, Canadian
Agent, Issuing Bank, Canadian Issuing Bank or any Lender), including all
interest, penalties, or similar liabilities relating thereto. If Borrowers
shall be required by Law to deduct or to withhold any Taxes from or in respect
of any amount payable hereunder, (i) the amount so payable shall be increased to
the extent necessary so that, after making all required deductions and
withholdings (including Taxes on amounts payable to Agent, Canadian Agent,
Issuing Bank, Canadian Issuing Bank or any Lender pursuant to this sentence),
Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender
receives an amount equal to the sum it would have received had no such
deductions or withholdings been made, (ii) Borrowers shall make such deductions
or withholdings, and (iii) Borrowers shall pay the full amount deducted or
withheld to the relevant taxing authority in accordance with Applicable Law.
Without prejudice to the survival of any other agreement of Borrowers hereunder,
the agreements and obligations of Borrowers contained in this SECTION 9.07 shall
survive the execution of this Agreement, termination of the Commitment,
repayment of the Obligations, satisfaction of each agreement securing or
assuring the Obligations and termination of this Agreement and each other Loan
Paper.
9.08. INDEMNIFICATION BY BORROWERS. BORROWERS AGREE JOINTLY AND
SEVERALLY TO INDEMNIFY, DEFEND, AND HOLD HARMLESS AGENT, CANADIAN AGENT, ISSUING
BANK, CANADIAN ISSUING BANK EACH LENDER AND THEIR RESPECTIVE AFFILIATES,
DIRECTORS, OFFICERS, AGENTS, EMPLOYEES, AND REPRESENTATIVES, FROM AND AGAINST
ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
JUDGMENTS, SUITS, CLAIMS, COSTS, EXPENSES, AND DISBURSEMENTS OF ANY KIND OR
NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST ANY
OF THEM IN ANY WAY RELATING TO OR ARISING OUT OF ANY LOAN PAPERS (INCLUDING IN
CONNECTION WITH OR AS A RESULT, IN WHOLE OR IN PART, OF THE NEGLIGENCE OF ANY OF
THEM), ANY TRANSACTION RELATED HERETO OR THERETO, OR ANY ACT, OMISSION, OR
TRANSACTION OF BORROWERS AND THEIR AFFILIATES WITH RESPECT HERETO AND THERETO,
OR ANY OF THEIR DIRECTORS, PARTNERS, OFFICERS, AGENTS, EMPLOYEES, OR
REPRESENTATIVES WITH RESPECT HERETO AND
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THERETO; PROVIDED, HOWEVER, THAT NONE OF AGENT, CANADIAN AGENT, ISSUING BANK,
CANADIAN ISSUING BANK OR ANY LENDER SHALL BE INDEMNIFIED, DEFENDED, AND HELD
HARMLESS PURSUANT TO THIS SECTION 9.08 TO THE EXTENT OF ANY LOSSES OR DAMAGES
WHICH EITHER OF BORROWERS PROVE WERE CAUSED BY THE INDEMNIFIED PARTY'S
WILLFUL MISCONDUCT OR GROSS NEGLIGENCE.
9.09. RATE PROVISION. It is not the intention of any party to any
Loan Papers to make an agreement violative of the Laws of any applicable
jurisdiction relating to usury. In no event shall any Obligor or any other
Person be obligated to pay any amount in excess of the Maximum Amount. If
Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or any Lender ever
receives, collects or applies, as interest, any such excess, such amount
which would be excessive interest shall be deemed a partial repayment of
principal and treated hereunder as such; and if principal is paid in full,
any remaining excess shall be paid to Parent, CA Canada or the other Person
entitled thereto. In determining whether or not the interest paid or
payable, under any specific contingency, exceeds the Maximum Amount, each
Obligor, Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank and each
Lender shall, to the maximum extent permitted under Applicable Laws, (a)
characterize any nonprincipal payment as an expense, fee or premium rather
than as interest, (b) exclude voluntary prepay ments and the effect thereof,
and (c) amortize, prorate, allocate and spread in equal parts, the total
amount of interest throughout the entire contemplated term of the Obligations
so that the interest rate is uniform throughout the entire term of the
Obligations; PROVIDED that if the Obligations are paid and performed in full
prior to the end of the full contemplated term thereof, and if the interest
received for the actual period of existence thereof exceeds the Maximum
Amount, Agent, Canadian Agent, Issuing Bank, Canadian Issuing Bank or
Lenders, as appropriate, shall refund to Parent or CA Canada the amount of
such excess or credit the amount of such excess against the total principal
amount owing, and, in such event, none or Agent, Canadian Agent, Issuing
Bank, Canadian Issuing Bank or any Lender shall be subject to any penalties
provided by any Laws for contracting for, charging or receiving interest in
excess of the Maximum Amount. This SECTION 9.09 shall control every other
provision of all agree ments among the parties to the Loan Papers pertaining
to the transactions contemplated by or contained in the Loan Papers.
9.10. SEVERABILITY. If any provision of any Loan Papers is held to be
illegal, invalid, or unenforceable under present or future Laws during the term
thereof, such provision shall be fully severable, the appropriate Loan Paper
shall be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part thereof, and the remaining provisions
thereof shall remain in full force and effect and shall not be affected by the
illegal, invalid, or unenforceable provision or by its severance therefrom.
Furthermore, IN LIEU of such illegal, invalid, or unenforceable provision there
shall be added automatically as a part of such Loan Paper a legal, valid, and
enforceable provision as similar in terms to the illegal, invalid, or
unenforceable provision as may be possible.
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9.11. EXCEPTIONS TO COVENANTS. No Obligor shall be deemed to be
permitted to take any action or to fail to take any action that is permitted as
an exception to any covenant in any Loan Papers, or that is within the
permissible limits of any covenant, if such action or omission would result in a
violation of any other covenant in any Loan Papers.
9.12. COUNTERPARTS. This Agreement and the other Loan Papers may be
executed in any number of counterparts, all of which taken together shall
constitute one and the same instrument. In making proof of any such agreement,
it shall not be necessary to produce or account for any counterpart other than
one signed by the party against which enforcement is sought.
9.13. GOVERNING LAW; WAIVER OF JURY TRIAL.
(a) EXCEPT AS HEREINAFTER SET FORTH, THIS AGREEMENT AND ALL OTHER LOAN
PAPERS SHALL BE DEEMED TO BE CONTRACTS MADE IN DALLAS, TEXAS, AND SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS
(WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS) AND THE UNITED STATES OF AMERICA.
THIS AGREEMENT AND ALL OTHER LOAN PAPERS, ONLY INSOFAR AS THEY RELATE TO THE
CANADIAN COMMITMENT, SHALL BE DEEMED TO BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE PROVINCE OF ALBERTA AND THE LAWS OF CANADA
APPLICABLE THEREIN. WITHOUT EXCLUDING ANY OTHER JURISDICTION, BORROWERS AGREE
THAT THE STATE AND FEDERAL COURTS OF TEXAS LOCATED IN DALLAS, TEXAS, WILL HAVE
JURISDICTION OVER PROCEEDINGS IN CONNECTION HEREWITH. TO THE MAXIMUM EXTENT
PERMITTED BY LAW, BORROWERS HEREBY WAIVE ANY RIGHT THAT THEY MAY HAVE TO A TRIAL
BY JURY OF ANY DISPUTE (WHETHER A CLAIM IN TORT, CONTRACT, EQUITY, OR OTHERWISE)
ARISING UNDER OR RELATING TO THIS AGREEMENT, THE OTHER LOAN PAPERS, OR ANY
RELATED MATTERS, AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE
SITTING WITHOUT A JURY.
(b) BORROWERS HEREBY WAIVE PERSONAL SERVICE OF ANY LEGAL PROCESS.
BORROWERS AGREE THAT SERVICE OF PROCESS MAY BE MADE UPON THEM BY REGISTERED MAIL
(RETURN RECEIPT REQUESTED) DIRECTED TO EITHER PARENT OR CA CANADA AT ITS
RESPECTIVE ADDRESS DESIGNATED FOR NOTICE UNDER THIS AGREEMENT AND SERVICE SO
MADE SHALL BE DEEMED TO BE COMPLETED FIVE DAYS AFTER DEPOSIT IN THE UNITED
STATES MAIL. NOTHING IN THIS SECTION 9.13 SHALL AFFECT THE RIGHT OF AGENT OR
CANADIAN AGENT OR ANY LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW.
92
9.15. RESTATEMENT. THIS AGREEMENT RESTATES IN ITS ENTIRETY THE EXISTING
AGREEMENT AND IS NOT INTENDED AS AND SHALL NOT BE CONSTRUED AS A RELEASE OR
NOVATION OF THE OBLIGATIONS OF EACH OBLIGOR PURSUANT TO THE EXISTING AGREEMENT.
9.16. ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN PAPERS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENT OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
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IN WITNESS WHEREOF, this Second Restated Credit Agreement is executed as of
the date first set forth above.
PARENT:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ BUILDING PRODUCTS,
INC.
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
CA CANADA:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ CANADA, INC.
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
AGENT:
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION
By: ---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
94
CANADIAN AGENT:
CANADIAN IMPERIAL BANK OF COMMERCE
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
CO-AGENT:
ABN AMRO BANK, N.V., Atlanta Agency
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
ISSUING BANK:
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION
By: ---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
CANADIAN ISSUING BANK:
CANADIAN IMPERIAL BANK OF COMMERCE
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
95
LENDERS:
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION
By: ---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
CANADIAN IMPERIAL BANK OF COMMERCE
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
ABN AMRO BANK, N.V., Atlanta Agency
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
▇▇▇▇▇ FARGO BANK (TEXAS), N.A.
By: ---------------------------
▇▇▇ ▇▇▇▇▇▇,
Assistant Vice President
96
SUNTRUST BANK, ATLANTA
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
By: ---------------------------
--------------, -----------
(Print Name) (Print Title)
97