Exhibit 10.1
Execution Counterpart
------------------------------
CREDIT AGREEMENT
dated as of
October 10, 1997
among
SEQUA CORPORATION
The SUBSIDIARY GUARANTORS Party Hereto
The LENDERS Party Hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
---------------------
$150,000,000
---------------------
---------------------------------------
CHASE SECURITIES INC.,
as Arranger
THE BANK OF NEW YORK,
as Syndication Agent
THE BANK OF NOVA SCOTIA,
as Documentation Agent
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Term 1
SECTION 1.02. Classification of Loans and Borrowings. . . . . . . . . . 25
SECTION 1.03. Terms Generally . . . . . . . . . . . . . . . . . . . . . 25
SECTION 1.04. Accounting Terms; GAAP. . . . . . . . . . . . . . . . . . 26
ARTICLE II
THE CREDITS
SECTION 2.01. The Commitments . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.02. Loans and Borrowings. . . . . . . . . . . . . . . . . . . 26
SECTION 2.03. Requests for Revolving Loan Borrowings. . . . . . . . . . 27
SECTION 2.04. Swingline Loans . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.05. Letters of Credit . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.06. Funding of Borrowings . . . . . . . . . . . . . . . . . . 34
SECTION 2.07. Interest Elections. . . . . . . . . . . . . . . . . . . . 35
SECTION 2.08. Termination and Reduction of the Commitments. . . . . . . 36
SECTION 2.09. Repayment of Loans; Evidence of Debt. . . . . . . . . . . 37
SECTION 2.10. Prepayment of Loans . . . . . . . . . . . . . . . . . . . 38
SECTION 2.11. Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 2.12. Interest. . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.13. Alternate Rate of Interest. . . . . . . . . . . . . . . . 41
SECTION 2.14. Increased Costs . . . . . . . . . . . . . . . . . . . . . 41
SECTION 2.15. Break Funding Payments. . . . . . . . . . . . . . . . . . 43
SECTION 2.16. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.18. Mitigation Obligations; Replacement of Lenders. . . . . . 46
SECTION 2.19. Extension of Maturity Date. . . . . . . . . . . . . . . . 47
ARTICLE III
GUARANTEE
SECTION 3.01. The Guarantee . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 3.02. Obligations Unconditional . . . . . . . . . . . . . . . . 48
SECTION 3.03. Reinstatement . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.04. Subrogation . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.05. Remedies. . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.06. Instrument for the Payment of Money . . . . . . . . . . . 50
SECTION 3.07. Continuing Guarantee. . . . . . . . . . . . . . . . . . . 50
SECTION 3.08. Rights of Contribution. . . . . . . . . . . . . . . . . . 50
SECTION 3.09. General Limitation on Guarantee Obligations . . . . . . . 51
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Organization; Powers. . . . . . . . . . . . . . . . . . . 51
SECTION 4.02. Authorization; Enforceability . . . . . . . . . . . . . . 51
SECTION 4.03. Governmental Approvals; No Conflicts. . . . . . . . . . . 52
SECTION 4.04. Financial Condition; No Material Adverse Change . . . . . 52
SECTION 4.05. Properties. . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 4.06. Litigation and Environmental Matters. . . . . . . . . . . 53
SECTION 4.07. Compliance with Laws and Agreements . . . . . . . . . . . 53
SECTION 4.08. Investment and Holding Company Status . . . . . . . . . . 53
SECTION 4.09. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 4.10. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.11. Disclosure. . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.12. Use of Credit . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.13. Material Agreements and Liens . . . . . . . . . . . . . . 54
SECTION 4.14. Material Subsidiaries, Etc. . . . . . . . . . . . . . . . 55
SECTION 4.15. Disaster. . . . . . . . . . . . . . . . . . . . . . . . . 55
ARTICLE V
CONDITIONS
SECTION 5.01. Effective Date. . . . . . . . . . . . . . . . . . . . . . 56
SECTION 5.02. Each Credit Event . . . . . . . . . . . . . . . . . . . . 57
ARTICLE VI
AFFIRMATIVE COVENANTS
SECTION 6.01. Financial Statements and Other Information. . . . . . . . 58
SECTION 6.02. Notices of Material Events. . . . . . . . . . . . . . . . 59
SECTION 6.03. Preservation of Existence and Properties, Scope of
Business,
Compliance with Law, Payment of Taxes and Claims,
Preservation of Enforceability. . . . . . . . . . . . 60
SECTION 6.04. Maintenance of Properties; Insurance. . . . . . . . . . . 60
SECTION 6.05. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . 61
SECTION 6.06. Books and Records; Inspection Rights. . . . . . . . . . . 61
SECTION 6.07. Certain Obligations Respecting Subsidiaries . . . . . . . 61
ARTICLE VII
NEGATIVE COVENANTS
SECTION 7.01. Guarantees. . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 7.02. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 7.03. Restricted Payments . . . . . . . . . . . . . . . . . . . 63
SECTION 7.04. Merger or Consolidation . . . . . . . . . . . . . . . . . 64
SECTION 7.05. Disposition of Assets . . . . . . . . . . . . . . . . . . 64
SECTION 7.06. Taxes of Other Persons. . . . . . . . . . . . . . . . . . 65
SECTION 7.07. Benefit Plans . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 7.08. Transactions with Affiliates. . . . . . . . . . . . . . . 65
SECTION 7.09. Limitation on Restrictive Covenants . . . . . . . . . . . 65
SECTION 7.10. Issuance or Disposition of Capital Securities;
Investments;
Acquisitions. . . . . . . . . . . . . . . . . . . . . 66
SECTION 7.11. Short Term Indebtedness . . . . . . . . . . . . . . . . . 66
SECTION 7.12. Material Subsidiary Indebtedness. . . . . . . . . . . . . 66
SECTION 7.13. Certain Financial Covenants.. . . . . . . . . . . . . . . 67
SECTION 7.14. Capital Expenditures. . . . . . . . . . . . . . . . . . . 68
SECTION 7.15. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . 68
ARTICLE VIII
EVENTS OF DEFAULT . . . . . . . . . . . . . . 68
ARTICLE IX
THE ADMINISTRATIVE AGENT. . . . . . . . . . . . . 71
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Notices. . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 10.02. Waivers; Amendments. . . . . . . . . . . . . . . . . . . 75
SECTION 10.03. Expenses; Indemnity; Damage Waiver . . . . . . . . . . . 76
SECTION 10.04. Successors and Assigns . . . . . . . . . . . . . . . . . 77
SECTION 10.05. Survival . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 10.06. Counterparts; Integration; Effectiveness . . . . . . . . 80
SECTION 10.07. Severability . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 10.08. Right of Setoff. . . . . . . . . . . . . . . . . . . . . 80
SECTION 10.09. Governing Law; Jurisdiction; Consent to Service of
Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 10.10. WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . 81
SECTION 10.11. Headings . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 10.12. Confidentiality. . . . . . . . . . . . . . . . . . . . . 82
SECTION 10.13. Interest Rate Limitation . . . . . . . . . . . . . . . . 83
SECTION 10.14. Waiver by Required Banks under the Existing Credit
Agreement . . . . . . . . . . . . . . . . . . . . . . 83
SCHEDULE I - Commitments
SCHEDULE II - Material Agreements and Liens
SCHEDULE III - Litigation and Environmental Matters
SCHEDULE IV - Subsidiaries and Investments
SCHEDULE V - Plans
SCHEDULE VI - Discontinued Subsidiaries and Non-Core Business
SCHEDULE VII - Permitted Restrictive Covenant
SCHEDULE VIII - Existing Subsidiary Indebtedness
SCHEDULE IX - Existing Guarantee
SCHEDULE X - Existing Liens
SCHEDULE XI - Existing Indebtedness
EXHIBIT A - Form of Assignment and Acceptance
EXHIBIT B - Form of Guarantee Assumption Agreement
EXHIBIT C - Form of Opinion of Counsel to the Obligors
EXHIBIT D - Form of Opinion of Special New York Counsel to The
Chase Manhattan Bank
CREDIT AGREEMENT dated as of October 10, 1997, among SEQUA
CORPORATION, the SUBSIDIARY GUARANTORS party hereto, the LENDERS party hereto,
and THE CHASE MANHATTAN BANK, as Administrative Agent.
The Borrower and the Subsidiary Guarantors, as an integrated
group, are engaged principally in the Business (as defined below), and in
furnishing the required supplies, services, equipment, credit and other
facilities for such Business. The integrated operation of the Business
requires financing on such a basis that credit supplied to the Borrower be
made available from time to time to the Subsidiary Guarantors, as required for
the continued successful operation of the Obligors, separately, and the
integrated operation as a whole. In that connection, the Obligors have
requested that the Lenders extend credit to the Borrower (to be made available
by the Lenders to the Subsidiary Guarantors) in an aggregate principal or face
amount not exceeding $150,000,000 to finance the operations of the Obligors
and for other purposes.
To induce the Lenders to extend such credit, the Obligors, the
Lenders and the Administrative Agent propose to enter into this Agreement
pursuant to which the Lenders will make loans to, and issue letters of credit
for the account of, the Borrower, and each Subsidiary Guarantor will guarantee
the credit so extended to the Borrower. Each of the Obligors expects to
derive benefit, directly or indirectly, from the credit so extended to the
Borrower, both in its separate capacity and as a member of the integrated
group, since the successful operation of each of the Obligors is dependent on
the continued successful performance of the functions of the integrated group
as a whole.
Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Adjusted LIBO Rate" means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for
such Interest Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means The Chase Manhattan Bank, in its
capacity as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified.
"Alternate Base Rate" means, for any day, a rate per annum equal
to the greatest of (a) the Prime Rate in effect on such day, (b) the Base CD
Rate in effect on such day plus 1% and (c) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. Any change in the Alternate Base Rate due
to a change in the Prime Rate, the Base CD Rate or the Federal Funds Effective
Rate shall be effective from and including the effective date of such change
in the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate,
respectively.
"Applicable Law" means (i) all applicable common law and
principles of equity and (ii) all applicable provisions of all (A)
constitutions, statutes, rules, regulations and orders of governmental bodies,
(B) Governmental Approvals and (C) orders, decisions, judgments and decrees of
all courts (whether at law or in equity or admiralty) and arbitrators.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment.
If the Commitments have terminated or expired, the Applicable Percentages
shall be determined based upon the Commitments most recently in effect, giving
effect to any assignments.
"Applicable Rate" means, for any day, with respect to any ABR Loan
(including any Swingline Loan) or Eurodollar Loan, or with respect to the
facility fees payable hereunder, as the case may be, the applicable rate per
annum set forth below under the caption "ABR Spread", "Eurodollar Spread" or
"Commitment Fee Rate", as the case may be, opposite the applicable Cash Flow
Ratio indicated below for such Rate Period:
Cash Flow ABR Eurodollar Commitment
Ratio Spread Spread Fee Rate
----- ------ ------ --------
Less than or equal
to 2.75 -0- .750% 0.250%
Greater than 2.75
and less than or
equal to 3.25 -0- 1.000% 0.275%
Greater than 3.25
and less than or
equal to 3.75 .250% 1.250% 0.300%
Greater than 3.75 .500% 1.500% 0.375%
For purposes hereof, (i) a "Rate Period" means (x) initially, the
period commencing on April 1, 1998 to but not including the first Rate Reset
Date (as defined below) thereafter and (y) thereafter, the period commencing
on a Rate Reset Date to but not including the immediately following Rate Reset
Date and (ii) a "Rate Reset Date" means, with respect to any fiscal quarter or
fiscal year, the date on which the Borrower is required to have delivered the
financial statements under Section 6.01(a) or (b) in respect of such fiscal
quater or fiscal year, as the case may be.
Anything in this Agreement to the contrary notwithstanding, until
March 31, 1998, the Applicable Rate shall be fixed as follows:
ABR Spread: -0-
Eurodollar Spread: 1.000%
Commitment Fee Rate: 0.275%
The Cash Flow Ratio for any Rate Period shall be the Cash Flow
Ratio set forth in the applicable financial statement required to be delivered
under Section 6.01(a) or (b) as at the last day of the fiscal quarter or
fiscal year, as the case may be, in respect of which such financial statement
is delivered.
Anything in this Agreement to the contrary notwithstanding, the
Applicable Rate shall be the highest rates provided for above (i) during any
period when an Event of Default shall have occurred and be continuing, or (ii)
during the period when the applicable financial statement shall not be
delivered within the time that the applicable financial statements are
required to be delivered by Section 6.01(a) or (b), as the case may be.
At any time that the Borrower has outstanding long term debt
securities that are not the subject of any credit enhancement and that are
rated at least BBB-, Baa3 or BBB- by at least two of S&P, ▇▇▇▇▇'▇ or ▇▇▇▇ &
▇▇▇▇▇▇ Credit Rating Co., respectively, the ABR Spread and the Eurodollar
Spread that would otherwise be applicable hereunder will be reduced by 0.125%
(but in no event less than zero) from the rate that would otherwise apply.
"Arranger" means Chase Securities Inc.
"Assessment Rate" means, for any day, the annual assessment rate
in effect on such day that is payable by a member of the Bank Insurance Fund
classified as "well-capitalized" and within supervisory subgroup "B" (or a
comparable successor risk classification) within the meaning of 12 C.F.R. Part
327 (or any successor provision) to the Federal Deposit Insurance Corporation
for insurance by such Corporation of time deposits made in dollars at the
offices of such member in the United States; provided that if, as a result of
any change in any law, rule or regulation, it is no longer possible to
determine the Assessment Rate as aforesaid, then the Assessment Rate shall be
such annual rate as shall be determined by the Administrative Agent to be
representative of the cost of such insurance to the Lenders.
"Asset Sale" means the sale, lease, license, transfer or other
disposition (including Sale and Leaseback Transactions) by the Borrower or any
of its Subsidiaries to any Person other than the Borrower or any of its
Subsidiaries of any asset or any interest therein, other than any disposition
of Margin Stock, or of receivables in accordance with the Receivables Purchase
Agreement.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 10.04), and accepted by the Administrative
Agent, in the form of Exhibit A or any other form approved by the
Administrative Agent.
"Availability Period" means the period from and including the
Effective Date to but excluding the earlier of the Maturity Date and the date
of termination of the Commitments.
"Base CD Rate" means the sum of (a) the Three-Month Secondary CD
Rate multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
"Borrower" means Sequa Corporation, a Delaware corporation.
"Borrowing" means (a) Revolving Loans of the same Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans,
as to which a single Interest Period is in effect or (b) a Swingline Loan.
"Borrowing Request" means a request by the Borrower for a
Revolving Loan Borrowing in accordance with Section 2.03.
"Business" means the repair and manufacture of components for jet
aircraft engines; supplying solid rocket fuel propulsion systems; application
of protective and decorative coatings to continuous steel and aluminum coil;
design and manufacture of equipment for the two-piece can industry; supplying
equipment for the web offset printing industry; producing and supplying TAED,
a bleach activator for powdered laundry detergent products; producing
high-quality performance-enhancing chemicals for the paper, textile and other
industries; manufacture of automotive cigarette lighters, power outlets and
electronic devices; manufacture of steel lids for cans; and related and/or
similar aerospace, machinery and metal coatings, special chemical products,
automotive accessory products and services from time to time, now or
hereafter, conducted by the Borrower and its Subsidiaries.
"Business Day" means any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or
required by law to remain closed; provided that, when used in connection with
a Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"Capital Expenditures" means, for any period, expenditures
(including, without limitation, the aggregate amount of Capital Lease
Obligations incurred during such period) made by the Borrower or any of its
Subsidiaries to acquire or construct fixed assets, plant and equipment
(including renewals, improvements and replacements, but excluding repairs)
during such period computed in accordance with GAAP.
"Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capital Security" means, with respect to any Person, (i) any
share of capital stock of such Person or (ii) any security convertible into,
or any option, warrant or other right to acquire, any share of capital stock
of such Person.
"Cash Equivalents" means: (a) direct obligations of the United
States of America, or of any agency thereof, or obligations guaranteed as to
principal and interest by the United States of America, or of any agency
thereof, in either case maturing not more than six months from the date of
acquisition thereof; (b) bankers' acceptances, time deposits, demand deposits
and certificates of deposit accepted by, placed with or issued either by a
Lender or by any bank or trust company organized under the laws of the United
States of America or any state thereof and having capital, surplus and
undivided profits of at least $500,000,000, and maturing not more than six
months from the date of acquisition thereof; (c) commercial paper rated A-1 or
better by S&P or P-1 by ▇▇▇▇▇'▇, maturing not more than 90 days from the date
of acquisition thereof; in each case so long as the same (x) provide for the
payment of principal and interest (and not principal alone or interest alone)
and (y) are not subject to any contingency regarding the payment of principal
or interest; (d) investments in repurchase agreements (or reverse repurchase
agreements) covering other Cash Equivalents with financial institutions that
are elected primary government securities dealers by the Federal Reserve Board
or whose securities are rated AA- or better by S&P or Aa or better by ▇▇▇▇▇'▇;
(e) money-market funds or money-market mutual funds that (i) seek to maintain
a constant net asset value, (ii) maintain fund assets under management having
an aggregate market value of at least $500,000,000, and (iii) invest primarily
in Cash Equivalents referred to in clauses (a) through (d) above; and (f)
direct obligations of foreign governmental entities or foreign banks rated AA-
or better by S&P or Aa by ▇▇▇▇▇'▇.
"Cash Flow Ratio" means, as at any date of determination thereof,
the ratio of (a) Indebtedness of the Borrower and its Subsidiaries (determined
on a consolidated basis, without duplication, in accordance with GAAP) as at
such date to (b) EBITDA for the period of four fiscal quarters ending on or
most recently ended prior to such date.
"Change in Control" means (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of
the Securities and Exchange Commission thereunder as in effect on the date
hereof), of shares representing more than 20% (or, in the case of Gabelli,
49%) of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of the Borrower; (b) occupation of a majority of the
seats (other than vacant seats) on the board of directors of the Borrower by
Persons who were neither (i) nominated by the board of directors of the
Borrower nor (ii) appointed by directors so nominated; or (c) the acquisition
of direct or indirect Control of the Borrower by any Person or group;
provided, however, that (x) for the purposes of the foregoing clauses (a) and
(c), the term "Person" shall not be deemed to include the individual who is
the Chairman of the Board of Directors of the Borrower on the Effective Date,
his spouse, any descendant of such Chairman or the spouse of any such
descendant, the estate of such Chairman, or any trust or other similar
arrangement for the benefit of such Chairman or his spouse, any descendant of
such Chairman or the spouse of any such descendant or the estate of such
Chairman or any corporation or other Person controlled solely by such Chairman
or his spouse, any descendant of such Chairman or the spouse of any such
descendant or the estate of such Chairman through the ownership of a majority
of the outstanding voting capital stock of such corporation or other Person
(such Chairman, spouse, descendant, spouse of such descendent, estate, trust,
corporation or other Person being referred to herein as an "Exempt Person" and
(y) no Change of Control shall be deemed to have occurred if, at the time of
determination, the Exempt Persons own, directly or indirectly, beneficially
and of record, shares representing more than 50% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of the
Borrower and the Exempt Persons Control the Borrower.
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule
or regulation or in the interpretation or application thereof by any
Governmental Authority after the date of this Agreement or (c) compliance by
any Lender or any Issuing Bank (or, for purposes of Section 2.14(b), by any
lending office of such Lender or by such Lender's or such Issuing Bank's
holding company, if any) with any request, guideline or directive (whether or
not having the force of law) of any Governmental Authority made or issued
after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are Revolving
Loans or Swingline Loans.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Commitment" means, with respect to each Lender, the commitment of
such Lender to make Revolving Loans and to acquire participations in Letters
of Credit and Swingline Loans hereunder, expressed as an amount representing
the maximum aggregate amount of such Lender's Revolving Exposure hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.08
and (b) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 10.04. The initial amount of each Lender's
Commitment is set forth on Schedule I, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment, as
applicable.
"Consolidated Net Worth" means, as at any date, the sum for the
Borrower and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP) of the following:
(a) the amount of capital stock and paid in capital (excluding
the cost of treasury shares or other similar equity interests); plus
(b) the amount of surplus and retained earnings (or, in the case
of surplus or retained earnings deficit, minus the amount of such
deficit).
"Contract" means (i) any agreement (whether bi-lateral or uni-
lateral or executory or non-executory and whether a Person entitled to rights
thereunder is so entitled directly or as a third-party beneficiary), including
an indenture, lease or license, (ii) any deed or other instrument of
conveyance, (iii) any certificate of incorporation or charter and (iv) any
bylaw.
"Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
"Debt Service" means, for any period, the sum, for the Borrower
and its Subsidiaries (determined on a consolidated basis without duplication
in accordance with GAAP), of the following: (a) all regularly scheduled
payments or prepayments of principal of Indebtedness (including, without
limitation, the principal component of any payments in respect of Capital
Lease Obligations) made during such period plus (b) all Interest Expense for
such period.
"Default" means any event or condition which constitutes an Event
of Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings and
the environmental matters disclosed in Schedule III.
"Discontinued Asset Sale" means each Asset Sale involving the
assets of a Discontinued Subsidiary.
"Discontinued Subsidiary" means each Subsidiary or division of the
Borrower or any Subsidiary identified on Part A of Schedule VI.
"Disqualified Stock" means any Capital Security which, by its
terms (or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder thereof, in whole or in part, on or
prior to the Maturity Date.
"dollars" or "$" refers to lawful money of the United States of
America.
"Domestic Subsidiary" means any Subsidiary that is organized or
created under the laws of the United States of America, any State or Territory
thereof or the District of Columbia.
"EBITDA" means, for any period, the sum, for the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) operating income (calculated
before taxes, Interest Expense, other income and expense, extraordinary and
unusual items that individually are in excess of $1,000,000 or that together
are in excess of $5,000,000 per year) for such period plus (b) depreciation
and amortization (to the extent deducted in determining net operating income)
for such period.
"Effective Date" means the date on which the conditions specified
in Section 5.01 are satisfied (or waived in accordance with Section 10.02).
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any Liability, contingent or
otherwise (including any Liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any
Subsidiary directly or indirectly resulting from or based upon (a) violation
of any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to any
Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials into the environment or (e) any contract, agreement or other
consensual arrangement pursuant to which Liability is assumed or imposed with
respect to any of the foregoing.
"Equity Interest" means Capital Security and Equity Rights.
"Equity Rights" means, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including, without limitation, any stockholders' or voting trust
agreements) for the issuance, sale, registration or voting of, or securities
convertible into, any additional shares of capital stock of any class, or
partnership or other ownership interests of any type in, such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code, or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (c) the filing pursuant to Section 412(d) of the Code
or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (d) the incurrence by the Borrower
or any of its ERISA Affiliates of any Liability under Title IV of ERISA with
respect to the termination of any Plan; (e) the receipt by the Borrower or any
ERISA Affiliate from the PBGC or a plan administrator of any notice relating
to an intention to terminate any Plan or Plans or to appoint a trustee to
administer any Plan; (f) the incurrence by the Borrower or any of its ERISA
Affiliates of any Liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in
Article VIII.
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender, any Issuing Bank or any other recipient of any payment to be made
by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United
States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located, (b) any
branch profits taxes imposed by the United States of America or any similar
tax imposed by any other jurisdiction in which the Borrower is located and
(c) in the case of a Foreign Lender (other than an assignee pursuant to a
request by the Borrower under Section 2.18(b)), any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement or is attributable to such Foreign
Lender's failure or inability to comply with Section 2.16(e), except to the
extent that such Foreign Lender's assignor (if any) was entitled, at the time
of assignment, to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 2.16(a).
"Existing Benefit Plan" means any Plan listed on Schedule V.
"Existing Credit Agreement" means the Amended and Restated Credit
Agreement dated as of December 14, 1993 among Borrower, The Bank of New York,
as administrative agent, The Bank of New York, The Bank of Nova Scotia and The
Chase Manhattan Bank (previously named Chemical Bank), as managing agents,
Bank of America NT&SA, The Chase Manhattan Bank (as successor by merger to The
Chase Manhattan Bank, N.A.) and The Nippon Credit Bank, Ltd., as co-agents,
and the banks referred to therein, as amended.
"Existing Guarantee" means any Guarantee outstanding, to the
extent, in the case of any Guarantee other than a Guarantee by SCC, set forth
on Schedule IX, and any renewals and extensions thereof, provided that, in the
case of any such renewals or extensions, the amount of the Liabilities so
Guaranteed shall not be increased.
"Existing Letters of Credit" means all letters of credit issued by
The Bank of New York under the Existing Credit Agreement that are outstanding
as of the Effective Date and listed on Schedule XI hereto.
"Existing Subsidiary Indebtedness" means, in the case of any
Subsidiary, (i) Indebtedness of such Subsidiary outstanding on the Effective
Date to the extent set forth on Schedule VIII, (ii) in the case of any
Subsidiary that becomes a Subsidiary after the Effective Date, any
Indebtedness of such Subsidiary outstanding immediately prior to, and at the
time such Subsidiary became a Subsidiary, but only if such Indebtedness was
not incurred in contemplation thereof, and (iii) any Indebtedness of such
Subsidiary constituting a renewal, extension or refunding of any Existing
Subsidiary Indebtedness of such Subsidiary, but only if (A) at the time such
Indebtedness is incurred and immediately after giving effect thereto, no
Default would exist, (B) the principal amount of such Indebtedness does not
exceed the principal amount of the Indebtedness so renewed, extended or
refunded and (C) such Indebtedness bears interest at a rate per annum not
exceeding the rate borne by, and on terms and conditions substantially the
same as, the Indebtedness so renewed, extended or refunded except for any
increase in interest rate that is commercially reasonably at the time such
Indebtedness is incurred.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average (rounded upwards,
if necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"Fixed Charges Ratio" means, as at any date, the ratio of
(a) EBITDA plus rent payable by the Borrower and its Subsidiaries for the
period of four consecutive fiscal quarters ending on or most recently ended
prior to such date to (b) Interest Expense during such period plus rent
payable by the Borrower and its Subsidiaries during such period plus dividends
(other than dividends paid to the Borrower or any of its Subsidiaries) paid
during such period.
"Fixed Rate Swingline Loan" has the meaning assigned to such term
in Section 2.04(d).
"Fixed Rate Swingline Period" has the meaning assigned to such
term in Section 2.04(d).
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"Funded Current Liability Percentage" has the meaning ascribed to
that term in Section 401(a)(29) of the Code.
"GAAP" means generally accepted accounting principles in the
United States of America.
"Gabelli" means any Person Controlled by, or which is an Affiliate
of, ▇▇▇▇▇ ▇▇▇▇▇▇▇.
"GATX Documents" means the GATX Guaranty and Indemnity Agreement
and the GATX Loan and Management Agreement, each dated as of March 24, 1994
and each other related agreement between the Borrower and/or SCC and GATX
Capital Corporation relating to the disposition of or borrowing against the
assets of SCC in effect on the Effective Date, with such amendments and
modifications thereto in form and substance (including, but not limited to,
the extent of the Liabilities incurred by the Borrower in connection
therewith) satisfactory to the Required Lenders.
"Governmental Approval" means any authorization, consent,
approval, license or exemption of, registration or filing with, or report or
notice to, any Governmental Authority.