Exhibit 10.1
CREDIT AGREEMENT
DATED AS OF JANUARY 14, 2005
AMONG
INVACARE CORPORATION
AND CERTAIN BORROWING SUBSIDIARIES,
THE BANKS NAMED THEREIN,
and
JPMORGAN CHASE BANK, N.A.
as Agent
KEYBANK NATIONAL ASSOCIATION
as Syndication Agent
▇.▇. ▇▇▇▇▇▇ SECURITIES, INC.
and
KEYBANK NATIONAL ASSOCIATION,
as Co-Lead Arrangers
TABLE OF CONTENTS
Article Page
ARTICLE I DEFINITIONS.....................................................................................1
1.1 Certain Definitions....................................................................1
1.2 Other Definitions; Rules of Construction..............................................16
1.3 Accounting Terms; GAAP................................................................16
ARTICLE II THE COMMITMENTS AND THE ADVANCES...............................................................16
2.1 Commitments of the Banks..............................................................16
2.2 Bid-Option Loans......................................................................19
(a) The Bid-Option...............................................................19
(b) Bid-Option Quote Request.....................................................19
(c) Invitation for Bid-Option Quotes.............................................20
(d) Submission and Contents of Bid-Option Quotes.................................20
(e) Notice to Borrower...........................................................21
(f) Acceptance and Notice by Borrower............................................21
(g) Allocation by Agent..........................................................22
2.3 Swing Loans...........................................................................22
(a) Making of Swing Loans........................................................22
(b) Swing Loan Borrowing Requests................................................22
(c) Repayment of Swing Loans.....................................................23
2.4 Termination and Reduction of Revolving Credit Commitments;
Increases of Revolving Credit Commitments.............................................23
2.5 Fees .............................................................................25
2.6 Disbursement of Advances..............................................................26
2.7 Conditions for Closing and First Disbursement.........................................28
(a) Charter Documents............................................................28
(b) By-Laws and Corporate Authorizations.........................................28
(c) Incumbency Certificate.......................................................28
(d) Loan Documents...............................................................29
(e) Legal Opinion................................................................29
(f) Consents, Approvals, Etc.....................................................29
(g) 2001 Credit Agreement & Bridge Credit Agreement..............................29
(h) Solvency and Compliance Certificates.........................................29
(i) Miscellaneous................................................................29
2.8 Further Conditions for Disbursement...................................................29
2.9 Subsequent Elections as to Borrowings.................................................30
2.10 Limitation of Requests and Elections..................................................30
2.11 Minimum Amounts; Limitation on Number of Borrowings...................................31
2.12 Treasury Manager......................................................................31
2.13 Applicable Lending Installation.......................................................31
ARTICLE III PAYMENTS AND PREPAYMENTS.......................................................................32
3.1 Principal Payments....................................................................32
3.2 Interest Payments.....................................................................33
3.3 Payment Method........................................................................34
3.4 No Setoff or Deduction................................................................35
3.5 Payment on Non-Business Day; Payment Computations.....................................36
3.6 Additional Costs......................................................................36
3.7 Illegality and Impossibility..........................................................37
3.8 Indemnification.......................................................................38
ARTICLE IV REPRESENTATIONS AND WARRANTIES.................................................................38
4.1 Corporate Existence and Power.........................................................38
4.2 Corporate Authority...................................................................38
4.3 Binding Effect........................................................................38
4.4 Subsidiaries..........................................................................39
4.5 Litigation............................................................................39
4.6 Financial Condition...................................................................39
4.7 Use of Loans..........................................................................39
4.8 Consents, Etc.........................................................................39
4.9 Taxes .............................................................................39
4.10 Title to Properties...................................................................40
4.11 ERISA .............................................................................40
4.12 Environmental and Safety Matters......................................................40
4.13 No Material Adverse Change............................................................41
4.14 No Default............................................................................41
4.15 Compliance with Laws..................................................................41
ARTICLE V COVENANTS .............................................................................41
5.1 Affirmative Covenants.................................................................41
(a) Preservation of Corporate Existence. Etc.....................................41
(b) Compliance with Laws, Etc....................................................41
(c) Maintenance of Properties; Insurance.........................................41
(d) Reporting Requirements.......................................................42
(e) Accounting; Access to Records, Books, Etc....................................42
(f) Stamp Taxes..................................................................42
(g) Further Assurances...........................................................42
5.2 Negative Covenants....................................................................44
(a) Interest Coverage Ratio......................................................44
(b) Net Worth....................................................................44
(c) Total Debt to Adjusted EBITDA................................................44
(d) Liens........................................................................44
(e) Merger; Etc..................................................................45
(f) Disposition of Assets; Etc...................................................45
(g) Nature of Business...........................................................46
(h) Limitations on Indebtedness of Subsidiaries..................................46
(i) Investments..................................................................46
(j) Transactions with Affiliates.................................................47
(k) Additional Covenants.........................................................47
(l) Acquisitions.................................................................48
(m) Dividends....................................................................48
ARTICLE VI DEFAULT .............................................................................48
6.1 Events of Default.....................................................................48
(a) Nonpayment of Principal......................................................48
(b) Nonpayment of Interest.......................................................48
(c) Misrepresentation............................................................48
(d) Certain Covenants............................................................48
(e) Other Defaults...............................................................48
(f) Cross Default................................................................48
(g) Judgments....................................................................49
(h) ERISA........................................................................49
(i) Insolvency, Etc..............................................................49
(j) Change of Control............................................................50
(k) Loan Documents...............................................................50
6.2 Remedies .............................................................................50
ARTICLE VII THE AGENT AND THE BANKS......................................................................51
7.1 Appointment and Authorization.........................................................51
7.2 Agent and Affiliates..................................................................51
7.3 Scope of Agent's Duties...............................................................51
7.4 Reliance by Agent.....................................................................52
7.5 Default .............................................................................52
7.6 Liability of Agent....................................................................52
7.7 Nonreliance on Agent and Other Banks..................................................52
7.8 Indemnification.......................................................................53
7.9 Resignation of Agent..................................................................53
7.10 Sharing of Payments...................................................................53
7.11 Withholding Tax Exemption.............................................................54
7.12 Co-Agent, Documentation Agents, Syndication Agent, Etc................................55
ARTICLE VIII MISCELLANEOUS..................................................................................55
8.1 Amendments, Etc.......................................................................55
8.2 Notices .............................................................................56
8.3 No Waiver By Conduct; Remedies Cumulative.............................................56
8.4 Reliance on and Survival of Various Provisions........................................57
8.5 Expenses; Indemnification.............................................................57
8.6 Successors and Assigns................................................................57
8.7 Counterparts..........................................................................60
8.8 Governing Law; Consent to Jurisdiction................................................60
8.9 Table of Contents and Headings........................................................60
8.10 Construction of Certain Provisions....................................................60
8.11 Integration and Severability..........................................................60
8.12 Independence of Covenants.............................................................61
8.13 Interest Rate Limitation..............................................................61
8.14 Confidentiality.......................................................................61
8.15 Waiver of Jury Trial..................................................................61
8.16 Unification of Certain Currencies.....................................................61
8.17 USA Patriot Act.......................................................................62
EXHIBITS
Exhibit A....................... Assignment and Assumption
Exhibit B....................... Bank Addition and Acknowledgment
Agreement
Exhibit C....................... Designation of new Borrowing Subsidiary
Exhibit D....................... Guaranty
Exhibit E....................... Bid-Option Quote Request
Exhibit F....................... Invitation for Bid-Option Quotes
Exhibit G....................... Bid-Option Quote
Exhibit H....................... Request for Revolving Credit Advance
Exhibit I....................... Form of Legal Opinion
Exhibit J....................... Compliance Certificate
Exhibit K....................... Request for Continuation or Conversion
of Revolving Credit Loan
SCHEDULES
Pricing Schedule
Schedule 1.1.................... Commitments
Schedule 4.4.................... Subsidiaries
Schedule 4.5.................... Litigation
Schedule 4.12................... Environmental Matters
Schedule 5.2(d)................. Liens
Schedule 5.2(i)................. Investments
CREDIT AGREEMENT
THIS
CREDIT AGREEMENT, dated as of January 14, 2005 (as amended or modified
from time to time, this "Agreement"), is by and among
INVACARE CORPORATION, an
Ohio corporation (the "Company"), each of the Subsidiaries of the Company
designated in Section 1.1 as a Borrowing Subsidiary (individually, a "Borrowing
Subsidiary" and collectively, the "Borrowing Subsidiaries") (the Company and the
Borrowing Subsidiaries may each be referred to as a "Borrower" and,
collectively, as the "Borrowers"),
Invacare Corporation, as treasury manager for
the Borrowers (the "Treasury Manager") and the Banks set forth on the signature
pages hereof (collectively, the "Banks" and individually, a "Bank") and JPMORGAN
CHASE BANK, N.A., a national banking association, successor by merger with Bank
One, NA, as administrative agent for the Banks (in such capacity, the "Agent").
INTRODUCTION
Pursuant to the terms of this Agreement, the Borrowers desire to obtain a
revolving credit facility, including letters of credit, in the aggregate
principal amount of $450,000,000 (or the equivalent thereof in any other
Permitted Currency), in order to refinance certain existing indebtedness under
the 2001
Credit Agreement (as defined herein) and the Bridge
Credit Agreement
(as defined herein) and provide funds for their general corporate purposes, and
the Banks are willing to establish such a credit facility in favor of the
Borrowers on the terms and conditions herein set forth.
In consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Definitions. As used herein the following terms shall have the
following respective meanings:
"Absolute Rate" means, with respect to an Absolute Rate Loan made by a
given Bank for the relevant Absolute Rate Interest Period, the rate of
interest per annum (rounded to the nearest 1/100 of 1%) offered by such
Bank and accepted by a Borrower pursuant to Section 2.2.
"Absolute Rate Advance" means a borrowing hereunder consisting of the
aggregate amount of the several Absolute Rate Loans made by some or all of
the Banks to a Borrower at the same time and for the same Absolute Rate
Interest Period.
"Absolute Rate Auction" means a solicitation of Bid-Option Quotes
setting forth Absolute Rates pursuant to Section 2.2.
"Absolute Rate Interest Period" means, with respect to an Absolute
Rate Advance, a period of not less than 14 and not more than 180 days
commencing on a Business Day selected by a Borrower pursuant to this
Agreement. If such Absolute Rate Interest Period would end on a day which
is not a Business Day, such Absolute Rate Interest Period shall end on the
next succeeding Business Day.
"Absolute Rate Loan" means a Loan which bears interest at an Absolute
Rate.
1
"Acquisition" shall mean any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which
the Company or any of its Subsidiaries (i) acquires any going business or
all or substantially all of the assets of any firm, corporation or limited
liability company, or division thereof, whether through purchase of assets,
merger or otherwise or (ii) directly or indirectly acquires (in one
transaction or as the most recent transaction in a series of transactions)
at least a majority (in number of votes) of the securities of a corporation
which have ordinary voting power for the election of directors (other than
securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the
outstanding ownership interests of a partnership or limited liability
company.
"Adjusted EBITDA" shall mean , with respect to any person, for any
period, the sum of (a) EBIT for such period, plus (b) all amounts deducted
in determining such EBIT on account of depreciation and amortization
expense, minus (c) any extraordinary, unusual or non-recurring gains or
other income (or plus any extraordinary, unusual or non-recurring non-cash
losses) not from the continuing operations of the Company and its
Subsidiaries, and related tax effects, in accordance with GAAP.
Notwithstanding anything herein, in any financial statements of the Company
or in GAAP to the contrary, for purposes of calculating and determining
Adjusted EBITDA, (i) any Acquisition made by the Company or any of its
Subsidiaries, including through mergers or consolidations and including any
related financing transactions, during the period for which such Adjusted
EBITDA was calculated shall be deemed to have occurred on the first day of
the relevant period for which such Adjusted EBITDA was calculated on a pro
forma basis acceptable to the Agent, but without giving effect to any
projected synergies resulting from such Acquisition and (ii) any amounts
which are attributable to any asset, investment or person which has been
divested by the Company or any Subsidiary during the period for which such
Adjusted EBITDA was calculated shall be excluded from the calculation of
Adjusted EBITDA and such divestiture shall be deemed to have occurred on
the first day of the relevant period for which such Adjusted EBITDA was
calculated.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Agent.
"Advance" shall mean any Loan and any Letter of Credit Advance.
"Affiliate" when used with respect to any person shall mean any other
person which, directly or indirectly, controls or is controlled by or is
under common control with such person. For purposes of this definition
"control" (including the correlative meanings of the terms "controlled by"
and "under common control with"), with respect to any person, shall mean
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such person, whether through
the ownership of voting securities or by contract or otherwise.
"Aggregate Commitments" means, at any time, the aggregate amount of
the Commitments of all Banks at such time.
"Aggregate Revolving Credit Commitments" means, at any time, the
aggregate amount of the Revolving Credit Commitments of all Banks at such
time.
"Alternate Currency" means (i) so long as such currencies remain
Eligible Currencies, Canadian Dollars, Australian Dollars and Euro, and
(ii) any other Eligible Currency which the Company requests the Agent to
include as an Alternate Currency hereunder and which is acceptable to
one-hundred percent (100%) of the applicable Alternate Currency Banks; and
2
with respect to which an Alternate Currency Addendum has been executed
among the Company, a Borrowing Subsidiary, one or more Alternate Currency
Banks and the Agent in connection therewith.
"Alternate Currency Addendum" means a schedule and addendum entered
into among the Company, a Borrowing Subsidiary, one or more Alternate
Currency Banks and the Agent, in form and substance satisfactory to the
Agent, the Company, such Borrowing Subsidiary and such Alternate Currency
Banks party thereto.
"Alternate Currency Bank" means any Bank (including any Applicable
Lending Installation) party to an Alternate Currency Addendum.
"Alternate Currency Commitment" means, for each Alternate Currency
Bank for each Alternate Currency, the obligation of such Alternate Currency
Bank to make Alternate Currency Loans not exceeding the Dollar Equivalent
set forth in the applicable Alternate Currency Addendum, as such amount may
be modified from time to time pursuant to the terms of this Agreement and
the applicable Alternate Currency Addendum.
"Alternate Currency Facility" means each credit facility established
pursuant to Sections 2.1(b) and (d).
"Alternate Currency Loan" means any Loan denominated in an Alternate
Currency made by the Agent or one or more of the Alternate Currency Banks
to a Borrower pursuant to this Agreement and the applicable Alternate
Currency Addendum.
"Applicable Fee Rate" shall mean, at any time, the percentage rate per
annum at which facility fees are accruing on the Commitments (without
regard to usage) and at which letter of credit fees are paid on Letters of
Credit, in each case, at such time as set forth in the Pricing Schedule.
"Applicable Lending Installation" shall mean, with respect to any
Bank, any office(s), agency(ies), branch(es), Subsidiary(ies) or
Affiliate(s) of such Bank selected by such Bank and notified to the Company
and the Agent by such Bank from time to time and, with respect to the
Agent, any office(s), agency(ies), branch(es), Subsidiary(ies) or
Affiliate(s) of the Agent selected by the Agent and notified to the Company
from time to time.
"Applicable Margin" means, with respect to Advances of any type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Approved Fund" has the meaning assigned to such term in Section 8.6.
"Assignment and Assumption" means an assignment and assumption entered
into by a Bank and an assignee (with the consent of any party whose consent
is required by Section 8.6), and accepted by the Agent, in the form of
Exhibit A or any other form approved by the Agent.
"Australian Dollars" or "AUS$" shall mean the lawful currency of
Australia.
"Bank Addition and Acknowledgement Agreement" means an agreement in
substantially the form of Exhibit B hereto, with such changes thereto as
approved by the Agent.
3
"Bank Obligations" shall mean all indebtedness, obligations and
liabilities, whether now owing or hereafter arising, direct, indirect,
contingent or otherwise, of the Borrowers to the Agent or any Bank pursuant
to the Loan Documents.
"Bid-Option Auction" shall mean an Absolute Rate Auction or
Eurocurrency Auction, or both, as the case may be.
"Bid-Option Interest Period" shall mean with respect to each
Bid-Option Borrowing, the Absolute Rate Interest Period or Eurocurrency
Interest Period, or both, as the case may be.
"Bid-Option Loan" shall mean Eurocurrency Bid Rate Loan or an Absolute
Rate Loan, or both, as the case may be.
"Bid-Option Percentage" shall mean, with respect to any Bank, the
percentage of the aggregate outstanding principal amount of the Bid-Option
Loans of all the Banks represented by the outstanding principal amount of
the Bid-Option Loans of such Bank.
"Bid-Option Quote" shall mean an offer by a Bank to make a Bid-Option
Loan in accordance with Section 2.2(d).
"Bid-Option Quote Request" shall have the meaning ascribed thereto in
Section 2.2(b).
"▇▇▇▇" shall mean a ▇▇▇▇ of exchange as defined in the Australian
Bills of Exchange ▇▇▇ ▇▇▇▇, as amended, or any successor
act or code, but shall not include a check.
"Borrowing" shall mean the aggregation of Advances made to any
Borrower, or continuations and conversions of such Advances, made pursuant
to Article II on a single date and for a single Interest Period. A
Borrowing may be referred to for purposes of this Agreement by reference to
the type of Loan comprising the relating Borrowing, e.g., a "Floating Rate
Borrowing" if such Loans are Floating Rate Loans, an "Eurocurrency Rate
Borrowing" if such Loans are Eurocurrency Rate Loans or a "Bid-Option
Borrowing" if such Loans are Bid-Option Loans.
"Borrowing Subsidiary" shall mean any Subsidiary of the Company party
to this Agreement on the Effective Date and any other Subsidiary of the
Company upon request by the Company to the Agent for designation of such
Subsidiary as a "Borrowing Subsidiary" hereunder from time to time so long
as (a) the Company guarantees the obligations of such new Borrowing
Subsidiary pursuant to the terms of the Guaranty, (b) such new Borrowing
Subsidiary delivers all corporate or organizational documents and
authorizing resolutions reasonably requested by the Agent and (c) the
Borrowers and such new Borrowing Subsidiary execute an agreement in the
form of Exhibit C attached hereto and all agreements and take such other
action reasonably requested by Agent.
"Bridge
Credit Agreement" shall mean the bridge
credit agreement dated
as of September 1, 2004 among the Company, the banks party thereto and
JPMorgan Chase Bank, N.A., successor by merger with Bank One, NA, as agent,
as amended or modified from time to time.
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which (a) the Agent is not open to the public for carrying on
substantially all of its banking functions or (b) if such reference relates
to the date for payment or purchase of any amount or deposit denominated in
any currency other than Dollars, banks are not generally open to the public
for carrying on substantially all of their banking functions in London,
England and in the principal financial center of the country issuing such
currency.
4
"Canadian Dollars" or "C$" shall mean the lawful currency of Canada.
"Capital Lease" of any person shall mean any lease which, in
accordance with GAAP, is capitalized on the books of such person.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations thereunder.
"Commitment" shall mean, with respect to each Bank, its Revolving
Credit Commitment, and, as applicable, its Alternate Currency Commitment.
"Competitive Bid Margin" means the margin above or below the
applicable Eurocurrency Base Rate (adjusted for reserve costs, if
applicable) offered for a Eurocurrency Bid Rate Loan, expressed as a
percentage (rounded to the nearest 1/100 of 1%) to be added or subtracted
from such Eurocurrency Base Rate.
"Consolidated" or "consolidated" shall mean, when used with reference
to any financial term in this Agreement, the aggregate for the Company and
its consolidated Subsidiaries of the amounts signified by such term for all
such persons determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, all interest
accrued by the Company and its Subsidiaries calculated on a consolidated
basis during such period.
"Consolidated Net Income" of any person shall mean, for any period,
the net income (after deduction for income and other taxes of such person
determined by reference to income or profits of such person) for such
period (but without reduction for any net loss incurred for any fiscal year
during such period), all as determined in accordance with GAAP.
"Consolidated Total Assets" means, as of any date, the total assets of
the Company and the Subsidiaries, determined in accordance with GAAP, as
set forth on the consolidated balance sheet of the Company as of such date.
"Contingent Liabilities" of any person shall mean, as of any date, all
obligations of such person or of others for which such person is
contingently liable, as obligor, guarantor, surety or in any other
capacity, or in respect of which obligations such person assures a creditor
against loss or agrees to take any action to prevent any such loss (other
than endorsements of negotiable instruments for collection in the ordinary
course of business), including without limitation (i) all reimbursement
obligations of such person in respect of any letters of credit, surety
bonds or similar obligations; (ii) all obligations of such person to
advance funds to, or to purchase assets, property or services from, any
other person in order to maintain the financial condition of such other
person; and (iii) any contingent consideration payable in connection with
any Acquisition to the extent that such person is contractually obligated
to make such payment and the amount of such payment can be and has been
determined.
"Default" shall mean any of the events or conditions described in
Section 6.1 which might become an Event of Default with notice or lapse of
time or both.
"Denmark Kroner" or "DK" shall mean the lawful currency of Denmark.
5
"Designated Borrower" shall mean, in relation to any Advance, the
Borrower nominated by the Treasury Manager as the Designated Borrower in
the request for such Advance.
"Dollar Equivalent" of an amount denominated in any currency other
than Dollars, as of any date of determination, shall mean the quotient of
(i) such amount divided by (ii) the number of units of such other currency
(stated as a decimal if less than 1.0) which could be purchased with one
(1) Dollar at the spot or other relevant rate of exchange quoted by the
Agent at approximately 11:00 a.m. London time on such date, which rate of
exchange shall be substantially representative of the market rate.
"Dollars" and "$" shall mean the lawful money of the United States of
America.
"Domestic Subsidiary" means each subsidiary organized under the laws
of a jurisdiction within the United States.
"EBIT" shall mean, with respect to any person, for any period, the sum
of (a) operating net income or loss plus (b) all amounts deducted in
determining such operating net income or loss on account of (i)
Consolidated Interest Expense and (ii) taxes based on or measured by
income, all as determined in accordance with GAAP, plus (c) the amount of
any one-time charge taken as a result of the cumulative effect from changes
to GAAP after the Effective Date.
"Effective Date" shall mean January 14, 2005.
"Eligible Currency" shall mean any currency other than Dollars that is
readily available, freely traded, in which deposits are customarily offered
to banks in the London interbank market, convertible into Dollars in the
international interbank market and as to which the Dollar Equivalent may be
readily calculated. If, after the designation by the Banks of any currency
as a Foreign Syndicated Currency or by the Alternate Currency Banks as an
Alternate Currency, currency control or other exchange regulations are
imposed in the country in which such currency is issued with the result
that different types of such currency are introduced, such country's
currency is, in the determination of the Agent, no longer readily available
or freely traded or as to which, in the determination of the Agent, a
Dollar Equivalent is not readily calculable, then the Agent shall promptly
notify the Company, and such country's currency shall no longer be a
Foreign Currency until such time as the Agent agrees to reinstate such
country's currency as a Foreign Currency and promptly, but in any event
within five (5) Business Days of receipt of such notice from the Agent, the
Borrowers with respect to such Foreign Currency shall repay all Loans in
such affected currency or convert such Loans into Loans in Dollars or a
Foreign Currency, as applicable, subject to the other terms of this
Agreement.
"Environmental Laws" at any date shall mean all provisions of law,
statute, ordinances, rules, regulations, judgments, writs, injunctions,
decrees, orders, awards and standards which are applicable to any Borrower
or any Subsidiary and promulgated by the government of the United States of
America or any foreign government or by any state, province, municipality
or other political subdivision thereof or therein or by any court, agency,
instrumentality, regulatory authority or commission of any of the foregoing
concerning the protection of, or regulating the discharge of substances
into, the environment.
"Equalized Share" is defined in Section 2.1(f).
"Equivalent" of an amount of one currency (the "first currency")
denominated in another currency (the "second currency"), as of any date of
determination, shall mean the amount of the second currency which could be
purchased with the amount of the first currency at the most favorable spot
6
exchange rate quoted by the Agent at approximately 11:00 a.m. local time of
the Applicable Lending Installation on such date, which rate shall be
substantially representative of the market rate.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations thereunder.
"ERISA Affiliate" shall mean, with respect to any person, any trade or
business (whether or not incorporated) which, together with such person or
any Subsidiary of such person, would be treated as a single employer under
Section 414 of the Code.
"Euro" and/or "EUR" means the euro referred to in council Regulation
(EC) No. 1103/97 dated June 17, 1997 passed by the Council of the European
Union or, if different, the then lawful currency of the member states of
the European Union that participate in the third stage of Economic and
Monetary Union.
"Eurocurrency Auction" means a solicitation of Bid-Option Quotes
setting forth Competitive Bid Margins pursuant to Section 2.2.
"Eurocurrency Base Rate" applicable to any Eurocurrency Interest
Period means:
(a) in the case of any Eurocurrency Rate Loans denominated in Dollars
for the relevant Eurocurrency Interest Period, the rate per annum obtained
by dividing (i) the per annum rate of interest equal to the applicable
British Bankers' Association Interest Settlement Rate for deposits in
Dollars appearing on Reuters Screen FRBD as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurocurrency Interest Period,
and having a maturity equal to such Eurocurrency Interest Period, provided
that, (x) if Reuters Screen FRBD is not available to the Agent for any
reason, the applicable rate for the relevant Eurocurrency Interest Period
shall instead be the applicable British Bankers' Association Interest
Settlement Rate for deposits in Dollars as reported by any other generally
recognized financial information service as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurocurrency Interest Period,
and having a maturity equal to such Eurocurrency Interest Period, and (y)
if no such British Bankers' Association Interest Settlement Rate is
available, the applicable rate for the relevant Eurocurrency Interest
Period shall instead be the rate determined by the Agent to be the rate at
which JPMCB offers to place deposits in Dollars with first-class banks in
the London interbank market at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurocurrency Interest Period,
in the approximate amount of JPMCB 's relevant Eurocurrency Rate Loan and
having a maturity equal to such Eurocurrency Interest Period, such sum to
be rounded up, if necessary, to the nearest whole multiple of one
one-hundredth of one percent (1/100 of 1%) by (ii) an amount equal to one
minus the stated maximum rate (expressed as a decimal) of all reserve
requirements including, without limitation, any marginal, emergency,
supplemental, special or other reserves, that is specified on the first day
of such Eurocurrency Interest Period by the Board of Governors of the
Federal Reserve System (or any successor agency thereto) for determining
the maximum reserve requirement with respect to eurocurrency funding
(currently referred to as "Eurocurrency liabilities" in Regulation D of
such Board) maintained by a member bank of such System, such sum to be
rounded up, if necessary, to the nearest whole multiple of one
one-hundredth of one percent (1/100 of 1%), all as conclusively determined
by the Agent, absent manifest error;
(b) In the case of any Eurocurrency Rate Loans denominated in any
Foreign Syndicated Currency for the relevant Eurocurrency Interest Period,
the rate per annum obtained by dividing (i) the per annum rate of interest
equal to the applicable British Bankers' Association Interest Settlement
Rate for deposits in the applicable Foreign Syndicated Currency appearing
on the applicable Reuters Screen for such Foreign Syndicated Currency as of
11:00 a.m. (London time) two Business Days prior to the first day of such
7
Eurocurrency Interest Period, and having a maturity equal to such
Eurocurrency Interest Period, provided that, (x) if the applicable Reuters
Screen for such Foreign Syndicated Currency is not available to the Agent
for any reason, the applicable rate for the relevant Eurocurrency Interest
Period shall instead be the applicable British Bankers' Association
Interest Settlement Rate for deposits in the applicable Foreign Syndicated
Currency as reported by any other generally recognized financial
information service as of 11:00 a.m. (London time) two Business Days prior
to the first day of such Eurocurrency Interest Period, and having a
maturity equal to such Eurocurrency Interest Period, and (y) if no such
British Bankers' Association Interest Settlement Rate is available, the
applicable rate for the relevant Eurocurrency Interest Period shall instead
be the rate determined by the Agent to be the rate at which JPMCB offers to
place deposits in the applicable Foreign Syndicated Currency with
first-class banks in the London interbank market at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such
Eurocurrency Interest Period, in the approximate amount of JPMCB's relevant
Eurocurrency Rate Loan and having a maturity equal to such Eurocurrency
Interest Period, such sum to be rounded up, if necessary, to the nearest
whole multiple of one one-hundredth of one percent (1/100 of 1%), divided
by (ii) an amount equal to one minus the stated maximum rate (expressed as
a decimal) of all reserve requirements (including, without limitation, any
marginal, emergency, supplemental, special or other reserves) and other
fees, charges and other requirements similar thereto or the functional
equivalent thereof which the Agent determines to be market practice to take
into account in determining the Eurocurrency Base Rate that are specified
on the first day of such Interest Period by the Board of Governors of the
Federal Reserve System (or any successor agency thereto) for determining
the maximum reserve requirement with respect to Eurocurrency funding
(currently referred to as "Eurocurrency liabilities" in Regulation D of
such Board) maintained by a member bank of such System or by any other
governmental entity, foreign or domestic, such sum to be rounded up, if
necessary, to the nearest whole multiple of one one-hundredth of one
percent (1/100 of 1%), all as conclusively determined by the Agent (absent
manifest error); provided that with respect to any Eurocurrency Rate Loans
in any Foreign Syndicated Currency, an alternative formula shall apply if
(a) the Borrower and the Agent shall have agreed to such alternative
formula, (b) such formula is based on the rate determined pursuant to
clause (i) above and (c) the Agent shall have determined that such
alternative formula more accurately compensates the Banks for the cost of
maintaining reserves and similar requirements in respect of such
Eurocurrency Rate Loans.
"Eurocurrency Bid Rate" means, with respect to a Eurocurrency Bid Rate
Loan made by a given Bank for the relevant Eurocurrency Interest Period,
the sum of (i) the quotient of (a) the Eurocurrency Base Rate applicable to
such Interest Period, divided by (b) one minus the Reserve Requirement
(expressed as a decimal) applicable to such Interest Period, plus (ii) the
Competitive Bid Margin offered by such Bank and accepted by a Borrower.
"Eurocurrency Bid Rate Advance" means a Competitive Bid Advance which
bears interest at a Eurocurrency Bid Rate.
"Eurocurrency Bid Rate Loan" means a Loan which bears interest at a
Eurocurrency Bid Rate.
"Eurocurrency Business Day" shall mean, with respect to any
Eurocurrency Rate Loan, a day which is both a Business Day and a day on
which dealings in Dollar deposits or the relevant Foreign Currency are
carried out in the relevant interbank market.
"Eurocurrency Interest Period" shall mean, with respect to any
Eurocurrency Rate Loan, the period commencing on the day such Eurocurrency
Rate Loan is made or converted to a Eurocurrency Rate Loan and ending on
the date one, two, three or six months thereafter or such other (longer or
shorter) period mutually agreed upon among the Agent, the Banks and the
Company, as any Borrower may elect under Section 2.6 or 2.9, provided,
8
however, that (a) any Eurocurrency Interest Period which commences on the
last Eurocurrency Business Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Eurocurrency Business Day of the
appropriate subsequent calendar month, (b) each Eurocurrency Interest
Period which would otherwise end on a day which is not a Eurocurrency
Business Day shall end on the next succeeding Eurocurrency Business Day or,
if such next succeeding Eurocurrency Business Day falls in the next
succeeding calendar month, on the next preceding Eurocurrency Business Day,
and (c) no Eurocurrency Interest Period which would end after the
Termination Date shall be permitted.
"Eurocurrency Rate" means, with respect to any Eurocurrency Rate Loan
for any Eurocurrency Interest Period or portion thereof, the per annum rate
that is equal to the sum of (a) the Applicable Margin, plus (b) the
Eurocurrency Base Rate; which Eurocurrency Rate shall change simultaneously
with any change in the margin described in clause (a) above.
"Eurocurrency Rate Loan" means any Loan which bears interest at the
Eurocurrency Rate.
"Event of Default" shall mean any of the events or conditions
described in Section 6.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and the regulations thereunder.
"Federal Funds Rate" shall mean the per annum rate that is equal to
the per annum rate established and announced by the Agent from time to time
as the opening federal funds rate paid or payable by the Agent in its
regional federal funds market for overnight borrowings from other banks; as
conclusively determined by the Agent, absent manifest error, such rate to
be rounded up, if necessary, to the nearest whole multiple of one
one-hundredth of one percent (1/100 of 1%), which Federal Funds Rate shall
change simultaneously with any change in such announced rates.
"Fixed Rate Loan" shall mean any Fixed Rate Revolving Credit Loan or
Bid-Option Loan.
"Fixed Rate Revolving Credit Loan" means any Eurocurrency Rate Loan.
"Floating Rate" shall mean the per annum rate equal to the greater of
(i) the Prime Rate in effect from time to time, or (ii) the sum of one-half
of one percent (1/2 of 1%) per annum plus the Federal Funds Rate in effect
from time to time; which Floating Rate shall change simultaneously with any
change in such Prime Rate or Federal Funds Rate, as the case may be.
"Floating Rate Loan" shall mean any Revolving Credit Loan which bears
interest at the Floating Rate.
"Foreign Currency" shall mean any Foreign Syndicated Currency or
Alternate Currency.
"Foreign Bank" means any Bank that is organized under the laws of a
jurisdiction other than that in which any 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" shall mean any Subsidiary of the Company that is
not a Domestic Subsidiary.
"Foreign Syndicated Currency" shall mean any currency which is an
Eligible Currency and approved by the Agent; provided, that, subject to the
terms of this Agreement (including without limitation Section 3.7), ▇▇▇▇▇▇
▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Kroner and Euro shall be deemed approved by the Agent and
shall be deemed to be Foreign Syndicated Currencies unless designated by
the Company as an Alternate Currency, in which case such currency shall be
an Alternate Currency if agreed to by all Alternate Currency Banks lending
such Alternate Currency and the Agent.
"GAAP" shall mean generally accepted accounting principles in the
United States of America.
"Guaranty" shall mean the guaranty entered into by the Company for the
benefit of the Agent and the Banks pursuant to this Agreement in the form
of Exhibit D hereto, as amended or modified from time to time.
"ICC" shall mean Invacare Credit Corp., an Ohio corporation, together
with its successors and assigns.
"Indebtedness" shall mean (i) indebtedness for borrowed money, (ii)
obligations evidenced by bonds, debentures, notes or other similar
instruments, (iii) obligations to pay the deferred purchase price of
property or services, except for trade accounts payable arising in the
ordinary course of business that are not more than 90 days past due or as
are reasonably being contested, (iv) obligations as lessee under leases
which have been in accordance with GAAP, recorded as Capital Leases, (v)
obligations to purchase property or services if payment is required
regardless of whether such property is delivered or services are performed
(generally called "take or pay" contracts), but such obligations shall only
be included in an amount equal to the difference between the amount of the
required payment and the value to the Company or a Subsidiary of the
Company of the goods or services required to be delivered in connection
with such required payment, (vi) obligations in respect of currency or
interest rate swaps or comparable transactions valued at the maximum
termination payment payable by the obligor, other than any such contracts
entered into as ▇▇▇▇▇▇ against Indebtedness of the kinds referred to in
clauses (i) and (ii) above; provided, that, for purposes of Section 6.1(f)
only, such contracts shall be included in "Indebtedness", (vii) any
obligation of any Person other than the Company or its Subsidiaries, if
such obligation is secured by any lien on the property of the Company or
any of its Subsidiaries, provided that, the amount of any such Indebtedness
shall be limited to the greater of the then book value or fair market value
of the property securing any such lien, (viii) liabilities in respect of
unfunded vested benefits under plans covered by Title IV of ERISA, (ix)
Off-Balance Sheet Liabilities, and (x) Contingent Liabilities with respect
to any of the foregoing.
"Interest Coverage Ratio" shall mean, as of any date, the ratio of (a)
Consolidated EBIT as calculated for the four most recently ended
consecutive fiscal quarters of the Company to (b) Consolidated Interest
Expense as calculated for the same four fiscal quarters.
"Interest Payment Date" shall mean (a) with respect to any
Eurocurrency Rate Loan or Bid-Option Loan, the last day of each Interest
Period with respect to such Eurocurrency Rate Loan or Bid-Option Loan and,
in the case of any Interest Period exceeding three months, those days that
occur during such Interest Period at intervals of three months after the
first day of such Interest Period, (b) with respect to any Alternate
Currency Loan, the date specified as the date on which interest is payable
in the applicable Alternate Currency Addendum, (c) with respect to any
Swing Loan, the date specified as the date on which interest is payable in
Section 2.1(b), and (d) in all other cases, within five (5) days of receipt
of an invoice containing a computation of interest due, which invoice shall
be prepared as of the last Business Day of each March, June, September and
December occurring after the date hereof, commencing with the first such
Business Day occurring after the date of this Agreement.
"Interest Period" shall mean any Eurocurrency Interest Period or
Bid-Option Interest Period.
10
"Invitation for Bid-Option Quotes" shall mean an invitation for
Bid-Option Quotes in the form referred to in Section 2.2(c).
"Investments" shall mean all investments, in cash or by delivery of
property, made, directly or indirectly, in any Person, whether by
acquisition of shares of Capital Stock, indebtedness or other obligations
or securities or by loan, advance, capital contribution or otherwise;
provided, however, that "Investments" shall not mean or include routine
investments in property to be used or consumed in the ordinary course of
business.
"JPMCB" means JPMorgan Chase Bank, N.A., together with its successors
and assigns.
"Lease Receivables Securitization Transaction" means any asset
securitization transaction associated with any leasing or commercial
purchase program of the Company, ICC or any other wholly owned Subsidiary.
"Letter of Credit" shall mean a standby letter of credit issued by the
Agent on behalf of the Banks for the account of any Borrower under an
application and related documentation acceptable to the Agent requiring,
among other things, immediate reimbursement by such Borrower to the Agent
in respect of all drafts or other demand for payment honored thereunder and
all expenses paid or incurred by the Agent relative thereto. Each letter of
credit issued and outstanding under the 2001
Credit Agreement shall be
deemed outstanding hereunder and a Letter of Credit for all purposes of
this Agreement and the other Loan Documents.
"Letter of Credit Advance" shall mean any issuance of a Letter of
Credit under Section 2.6 made pursuant to Section 2.1 in which each Bank
acquires a pro rata risk participation (based on such Bank's Revolving
Credit Commitment) pursuant to Section 2.6(e).
"Lien" shall mean any pledge, assignment, deed of trust,
hypothecation, mortgage, security interest, conditional sale or title
retaining contract, financing statement filing, or any other type of lien,
charge, encumbrance or other similar claim or right.
"Loan" shall mean any Revolving Credit Loan, any Alternate Currency
Loan, any Swing Loan or any Bid-Option Loan, as the context may require.
"Loan Documents" shall mean this Agreement, the Letter of Credit
Documents, the Guaranty, the Alternate Currency Addendums, any other
agreement, note, instrument or document executed at any time in connection
with this Agreement.
"Margin Stock" shall mean Margin Stock within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System.
"Material Adverse Effect" means a material adverse effect on (i) the
business, property, condition (financial or otherwise) or results of
operations of the Company and its Subsidiaries taken as a whole, or (ii)
the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Agent or the Banks thereunder.
"Multiemployer Plan" shall mean any "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA or Section 414(f) of the Code.
11
"National Currency Unit" means the unit of currency (other than a Euro
unit) of each member state of the European Union that participates in the
third stage of Economic and Monetary Union.
"Net Worth" of any person shall mean, as of any date, the amount of
stockholders' equity, exclusive of the cumulative effect of Other
Comprehensive Earnings (either positive or negative), all on a consolidated
basis and in accordance with GAAP.
"Notice of Bid-Option Loan" shall have the meaning set forth in
Section 2.2(f).
"Off-Balance Sheet Liability" of a person means (i) any repurchase
obligation or liability of such person with respect to accounts or notes
receivable sold by such person, (ii) any liability under any sale and
leaseback transaction which is not a Capital Lease, (iii) any liability
under any so-called "synthetic lease" transaction entered into by such
person, or (iv) any obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheets
of such person, but excluding from this clause (iv) Operating Leases.
"Operating Lease" of a person means any lease of property (other than
a Capital Lease) by such person as lessee which has an original term
(including any required renewals and any renewals effective at the option
of the lessor) of one year or more.
"Other Comprehensive Earnings (Loss)" shall mean the reported
increases or decreases in the Company's reported Net Worth resulting from
(a) foreign currency translation adjustments, (b) unrealized gains (losses)
on available securities held for sale, and (c) the cumulative effect of the
Company's adoption of FAS 133.
"Overdue Rate" shall mean (a) in respect of principal of Floating Rate
Loans, a rate per annum that is equal to the sum of two percent (2%) per
annum plus the Floating Rate, (b) in respect of principal of Fixed Rate
Loans, a rate per annum that is equal to the sum of two percent (2%) per
annum plus the per annum rate in effect thereon until the end of the then
current Interest Period for such Loan and, thereafter, a rate per annum
that is equal to the sum of two percent (2%) per annum plus, with respect
to Loans denominated in Dollars, the Floating Rate and, with respect to
Loans denominated in any other Permitted Currency, the relevant interbank
rate for such Permitted Currency plus the Applicable Margin, and (c) in
respect of other amounts payable by any Borrower hereunder (other than
interest), a per annum rate that is equal to the sum of two percent (2%)
per annum plus the Floating Rate or, with respect to any Alternate Currency
Loan, such other overdue rate, if any, as specified in the applicable
Alternate Currency Addendum.
"Participant" has the meaning set forth in Section 8.6.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Permitted Currency" shall mean any Alternate Currency and any
Syndicated Currency.
"Permitted Liens" shall mean Liens permitted by Section 5.2(d) hereof.
"Person" or "person" shall include an individual, a corporation, a
limited liability company, an association, a partnership, a trust or
estate, a joint stock company, an unincorporated organization, a joint
venture, a trade or business (whether or not incorporated), a government
(foreign or domestic) and any agency or political subdivision thereof, or
any other entity.
12
"Plan" shall mean, with respect to any person, any pension plan (other
than a Multiemployer Plan) subject to Title IV of ERISA or to the minimum
funding standards of Section 412 of the Code which has been established or
maintained by such person, any Subsidiary of such person or any ERISA
Affiliate, or by any other person if such person, any Subsidiary of such
person or any ERISA Affiliate could have liability with respect to such
pension plan.
"Pounds Sterling" or "Pounds" shall mean the lawful currency of the
United Kingdom.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Prime Rate" shall mean the per annum rate announced or established by
the Agent from time to time as its "prime rate" (it being acknowledged that
such announced rate may not necessarily be the lowest rate charged by the
Agent to any of its customers), which Prime Rate shall change
simultaneously with any change in such announced or established rates.
"Prohibited Transaction" shall mean any non-exempt transaction
involving any Plan which is proscribed by Section 406 of ERISA or Section
4975 of the Code.
"Pro Rata Share" means, for each Bank, the ratio of such Bank's
Commitment to the Aggregate Commitments, provided, that (a) with respect to
Revolving Credit Loans, Letter of Credit Advances and Swing Loans, Pro Rata
Share means, for each Bank, the ratio such Bank's Revolving Credit
Commitment bears to the Aggregate Revolving Credit Commitments, and (b)
with respect to Alternate Currency Loans for any Alternate Currency
Facility, Pro Rata Share means, for each Alternate Currency Bank for each
Alternate Currency Facility, the ratio such Alternate Currency Bank's
Alternate Currency Commitment for such Alternate Currency Facility bears to
the aggregate Alternate Currency Commitments for such Alternate Currency
Facility. If at any time the Commitments have been terminated, the amount
of any Commitment for the purposes of this definition of "Pro Rata Share"
only shall be deemed equal to the amount of such Commitment immediately
prior to its termination.
"Register" has the meaning set forth in Section 8.6.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"Reportable Event" shall mean a reportable event as described in
Section 4043(b) of ERISA including those events as to which the thirty (30)
day notice period is waived under Part 2615 of the regulations promulgated
by the PBGC under ERISA.
"Request for a New Alternate Currency Facility" is defined in Section
2.1(d).
"Required Banks" shall mean Banks in the aggregate having at least 51%
of the aggregate Commitments or, if the Commitments have been terminated,
Banks in the aggregate holding at least 51% of the aggregate unpaid
principal amount of the outstanding Advances.
"Restricted Margin Stock" means Margin Stock owned by the Company or
any of its Subsidiaries which represents not more than 25% of the aggregate
value (determined in accordance with Regulation U), on a consolidated
basis, of the property and assets of the Company and its Subsidiaries
(other than any Margin Stock) that is subject to the provisions of Section
5.2(d).
13
"Revolving Credit Advance" shall mean any Revolving Credit Loan, any
Letter of Credit Advance and any Swing Loan.
"Revolving Credit Commitment" shall mean, with respect to each Bank,
the commitment of each such Bank to make Revolving Credit Loans and to
participate in Letter of Credit Advances made through the Agent pursuant to
Section 2.1(a), in amounts not exceeding in aggregate principal amount
outstanding at any time the respective revolving credit commitment amount
for each such Bank set forth opposite the name of each such Bank in
Schedule 1.1 under the heading "Revolving Credit Commitments", or, as to
any Bank becoming a party hereto after the Effective Date as set forth in
the applicable Assignment and Acceptance, as such amounts may be reduced
from time to time pursuant to Sections 2.1(d) or 2.4 or modified pursuant
to Sections 2.1(d), 2.4 or 8.6.
"Revolving Credit Loan" shall mean any Borrowing under Section 2.6 and
made pursuant to Section 2.1(a).
"SEC" means the Securities and Exchange Commission, or any
governmental authority succeeding to any of its principal functions.
"Securitization Entity" means a wholly-owned Subsidiary of the Company
that engages in no activities other than Securitization Transactions and
any necessary related activities and owns no assets other than as required
or permitted for Securitization Transactions and (i) no portion of the
Indebtedness (contingent or otherwise) of which is guaranteed by the
Company or any Subsidiary of the Company or is recourse to or obligates the
Company or any Subsidiary of the Company in any way, other than pursuant to
customary representations, warranties, covenants, indemnities and other
obligations entered into in connection with a Securitization Transaction,
and (ii) to which neither the Company nor any Subsidiary of the Company has
any material obligation to maintain or preserve such entity's financial
condition or cause such entity to achieve certain levels of operating
results.
"Securitization Transaction" means any Lease Receivables
Securitization Transaction and any Trade Receivables Securitization
Transaction.
"Senior Unsecured Notes" means the 6.60% Senior Notes of the Borrower,
due February 27, 2005, issued in an aggregate original principal amount of
$20,000,000, under that certain Note Agreement dated as of February 27,
1995 between the Borrower and the Purchasers named therein, the 6.71%
Senior Notes due February 27, 2008, issued in an aggregate original
principal amount of $80,000,000 under that certain Note Agreement dated as
of February 27, 1998 between the Borrower and the Purchasers named therein,
the Series A Senior Unsecured Notes due October 1, 2007 issued on October
1, 2003 in the aggregate original principal amount of $50,000,000, the
Series B Senior Unsecured Notes due October 1, 2009 issued on October 1,
2003 in an aggregate original principal amount of $30,000,000 and the
Series C Senior Unsecured Notes due October 1, 2010 issued on October 1,
2003 in an aggregate principal amount of $20,000,000.
"Significant Subsidiary" means (i) any Subsidiary which is a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X under
the Securities and Exchange Act of 1934 if 5% were substituted for 10%
wherever it occurs in such Rule, and (ii) any Subsidiary which is
responsible for more than 5% of consolidated net sales of the Company and
its Subsidiaries as reflected in the most recent financial statements of
the Company delivered pursuant to Section 5.1(d).
"Subsidiary" of any person shall mean any other person (whether now
existing or hereafter organized or acquired) in which (other than
directors' qualifying shares required by law) at least a majority of the
14
securities or other ownership interests of each class having ordinary
voting power or analogous right (other than securities or other ownership
interests which have such power or right only by reason of the happening of
a contingency), at the time as of which any determination is being made,
are owned, beneficially and of record, by such person or by one or more of
the other Subsidiaries of such person or by any combination thereof. Unless
otherwise specified, reference to "Subsidiary" shall mean a Subsidiary of
the Company.
"Swing Line Facility" shall have mean the swing line facility
established pursuant to Section 2.3.
"Swing Loan" is defined in Section 2.3.
"Syndicated Currency" shall mean Dollars and any Foreign Syndicated
Currency.
"Threshold Amount" shall mean the lesser of (i) $20,000,000 or (ii)
the threshold amount set forth in the indebtedness cross default provisions
in the documents evidencing the Senior Unsecured Notes.
"Termination Date" shall mean the earlier to occur of (a) January 14,
2010 and (b) the date on which the Commitments shall be terminated pursuant
to Section 2.4 or 6.2.
"Total Debt" as of any date for any person, shall mean: (a) all debt
for borrowed money and similar monetary obligations evidenced by bonds,
notes, debentures, Capitalized Lease obligations or otherwise; (b) all
liabilities secured by any Lien existing on property owned or acquired
subject thereto, whether or not the liability secured thereby shall have
been assumed; (c) all reimbursements obligations under outstanding letters
of credit in respect of drafts which (i) may be presented or (ii) have been
presented and have not yet been paid, (d) the aggregate outstanding amount
of all Trade Receivables Securitization Transactions, based on the
aggregate outstanding amount sold, assigned, discounted or otherwise
transferred or financed, whether or not shown as a liability on a
consolidated balance sheet of such person, as reasonably satisfactory to
the Agent (but excluding any amounts outstanding under any Lease
Receivables Securitization Transaction), and (e) all Contingent Liabilities
relating to any of the obligations of others similar in character to those
described in the foregoing clauses (a) through (d), but excluding all
recourse obligations of the Company, ICC or any other wholly-owned
Subsidiary under certain third party financing arrangements offered to
customers which are acceptable to the Agent (including arrangements with De
▇▇▇▇ ▇▇▇▇▇▇).
"Trade Receivables Securitization Transaction" means any trade
receivables securitization transaction involving the Company or any
Subsidiary, whether reflected on or off the balance sheet of the Company or
such Subsidiary.
"Treasury Manager" includes any Affiliate of the Company appointed in
writing by the Company and the Borrowers as Treasury Manager under this
Agreement in the place of the person named above, and which is accepted by
the Agent for that purpose.
"2001 Credit Agreement" shall mean the five-year credit agreement
dated as of October 17, 2001, among the Company, the other borrowers named
therein, the banks party thereto and JPMorgan Chase Bank, N.A, as successor
by merger with Bank One, NA, successor by merger with Bank One, Michigan,
as agent, as amended or modified from time to time.
"Unfunded Benefit Liabilities" shall mean, with respect to any Plan as
of any date, the amount of the unfunded benefit liabilities determined in
accordance with Section 4001(a)(18) of ERISA.
15
"Unrestricted Margin Stock" means any Margin Stock owned by the
Company or any of its Subsidiaries which is not Restricted Margin Stock.
1.2 Other Definitions; Rules of Construction. As used herein, the
terms "Agent", "Banks", "Company", "Borrowing Subsidiary", "Borrowing
Subsidiaries" and "this Agreement" shall have the respective meanings
ascribed thereto in the introductory paragraph of this Agreement. Such
terms, together with the other terms defined in Section 1.1, shall include
both the singular and the plural forms thereof and shall be construed
accordingly. Use of the terms "herein", "hereof", and "hereunder" shall be
deemed references to this Agreement in its entirety and not to the Section
or clause in which such term appears. References to "Sections" and
"subsections" shall be to Sections and subsections, respectively, of this
Agreement unless otherwise specifically provided.
1.3 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed
in accordance with GAAP, as in effect from time to time; provided that, if
the Company notifies the Agent that the Company requests an amendment to
any provision hereof to eliminate the effect of any change occurring after
the date hereof in GAAP or in the application thereof on the operation of
such provision (or if the Agent notifies the Company that the Required
Banks request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change
in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.
ARTICLE II
THE COMMITMENTS AND THE ADVANCES
2.1 Commitments of the Banks.
(a) Each Bank agrees, for itself only, subject to the terms and
conditions of this Agreement, to make Revolving Credit Loans denominated in
any Syndicated Currency to the Borrowers pursuant to Section 2.6 and
Section 3.3 and to participate in Letter of Credit Advances denominated in
any Syndicated Currency to the Borrowers pursuant to Section 2.6, from time
to time from and including the Effective Date to but excluding the
Termination Date, not to exceed in aggregate principal amount at any time
outstanding the amount of its respective Revolving Credit Commitment as of
the date any such Advance is made; provided, however, that (i) the Dollar
Equivalent of the aggregate principal amount of Letter of Credit Advances
outstanding at any time shall not exceed $50,000,000, (ii) the Dollar
Equivalent of all Alternate Currency Loans outstanding at any time shall
not exceed $100,000,000, (iii) the Dollar Equivalent of all Revolving
Credit Advances, all Swing Loans and all Alternate Currency Loans
outstanding at any time shall not exceed the aggregate Commitments, (iv)
the Dollar Equivalent of all Revolving Credit Advances and all Swing Loans
outstanding at any time shall not exceed the aggregate Revolving Credit
Commitments, and (v) the Dollar Equivalent of all Alternate Currency Loans
outstanding at any time shall not exceed the aggregate Alternate Currency
Commitments.
(b) Subject to the terms and conditions of this Agreement and the
applicable Alternate Currency Addendum, from and including the later of the
date of this Agreement and the date of execution of the applicable
Alternate Currency Addendum and prior to the Termination Date (unless an
earlier termination date shall be specified in the applicable Alternate
Currency Addendum), the Agent and the applicable Alternate Currency Banks
agree, on the terms and conditions set forth in this Agreement and in the
applicable Alternate Currency Addendum, to make Alternate Currency Loans
16
under such Alternate Currency Addendum to the applicable Borrower party to
such Alternate Currency Addendum from time to time in the applicable
Alternate Currency, in an amount not to exceed each such Alternate Currency
Bank's applicable Alternate Currency Commitment; provided, however, (i) at
no time shall the Dollar Equivalent of the outstanding principal amount of
all Alternate Currency Loans exceed the least of (A) $100,000,000, (B) the
aggregate Alternate Currency Commitments or (C) the aggregate amount that
would be permitted by the proviso to Section 2.1(a), and (ii) at no time
shall the Dollar Equivalent of the Alternate Currency Loans for any
specific Alternate Currency exceed the maximum amount specified as the
maximum amount for such Alternate Currency in the applicable Alternate
Currency Addendum. Each Alternate Currency Loan shall consist of Alternate
Currency Loans made by each applicable Alternate Currency Bank ratably in
proportion to such Alternate Currency Bank's respective Pro Rata Share.
Subject to the terms of this Agreement and the applicable Alternate
Currency Addendum, the Borrowers may borrow, repay and reborrow Alternate
Currency Loans at any time prior to the Termination Date. On the
Termination Date, the outstanding principal balance of the Alternate
Currency Loans shall be paid in full by the applicable Borrower and prior
to the Termination Date prepayments of the Alternate Currency Loans shall
be made by the applicable Borrower if and to the extent required by this
Agreement.
(c) If and to the extent any Alternate Currency Bank shall not make
its pro rata portion of any Alternate Currency Loan available to the Agent,
the Agent may (but shall not be obligated to) make such amount available to
the relevant Borrower, and such Alternate Currency Bank agrees to pay to
the Agent forthwith on demand such amount together with interest thereon,
for each day from the date such amount is made available to such Borrower
by the Agent until the date such amount is repaid to the Agent, at a rate
per annum equal to the Agent's cost of funds for such day for the first
three days and, thereafter, the interest rate applicable to the relevant
Loan. If for any reason any applicable Alternate Currency Bank fails to
fund its Pro Rata Share of any Alternate Currency Loan at the time required
under this Agreement and the applicable Alternate Currency Addendum (the
amount of such unfunded Pro Rata Share being hereinafter referred to as the
"Unfunded Amount"), the Agent shall be entitled to receive, retain and
apply against such Unfunded Amount the principal and interest otherwise
payable to such Alternate Currency Bank under this Agreement until the
Agent receives such Unfunded Amount from such Alternate Currency Bank or
such Unfunded Amount is otherwise fully satisfied. In addition to the
foregoing, if for any reason any Alternate Currency Bank fails to fund its
Pro Rata Share of any Alternate Currency Loan at the time required under
this Agreement and the applicable Alternate Currency Addendum, such
Alternate Currency Bank shall be deemed, at the option of the Agent, to
have unconditionally and irrevocably purchased from the Agent, without
recourse or warranty, an undivided interest in and participation in the
applicable Alternate Currency Loan in the amount of such Alternate Currency
Bank's Pro Rata Share thereof under this Agreement and the applicable
Alternate Currency Addendum, and such interest and such participation may
be recovered from such Alternate Currency Bank together with interest
thereon at a rate per annum equal to the Agent's cost of funds for such day
for the first three days and, thereafter, the interest rate applicable to
the relevant Loan during the period commencing on the date of demand by the
Agent and ending on the date such funding shortfall is fully satisfied.
(d) The Company may, by written notice to the Agent request the
establishment of additional Alternate Currency Commitments in additional
Alternate Currencies (other than Syndicated Currencies) provided the Dollar
Equivalent of the aggregate amount of all of the Alternate Currency Loans
does not exceed $100,000,000 ("Request for a New Alternate Currency
Facility"). The Agent will promptly forward to the Banks any Request for a
New Alternate Currency Facility received from the Company; provided each
Bank shall be deemed not to have agreed to provide an Alternate Currency
Commitment unless its written consent thereto has been received by the
Agent within ten (10) Business Days from the date of such notification by
the Agent to such Bank. In the event that sufficient Banks consent to
17
provide such Alternate Currency Commitment pursuant to such Request for a
New Alternate Currency Facility, upon execution of the applicable Alternate
Currency Addendum and the other documents, instruments and agreements
required pursuant to this Agreement and such Alternate Currency Addendum,
the Alternate Currency Facility shall be established. Unless a Bank is
providing an Alternate Currency Commitment with respect to any Alternate
Currency Facility, consent of the Banks or Required Bank shall not be
required to establish an Alternate Currency Facility. Upon the
establishment of any Alternate Currency Facility under this Section 2.1(d),
the relevant Borrower may, at its option and upon ten (10) Business Days
prior written notice to the Agent, activate the Alternate Currency
Commitments established under such Alternate Currency Facility, which
notice shall specify the Alternate Currency Commitment which is being
activated, the amount of such activation stated in U.S. Dollars and the
requested date of activation. (Such activation notice may be provided to
the Agent at the time of the Request for a New Alternate Currency Facility
in the event the Borrower desires to activate the Alternate Currency
Commitment immediately upon establishment of the Alternate Currency
Facility in which case no waiting period shall be operative and only the
advance notice period required by Section 2.6(a)(iii) shall be required).
Upon activation of such Alternate Currency Commitment of any Alternate
Currency Bank, (i) Alternate Currency Loans may be made under such
Alternate Currency Facility, (ii) the amount of such Alternate Currency
Bank's Revolving Credit Commitment shall be immediately reduced by the
amount of such Bank's new Alternate Currency Commitment, (iii) the
Aggregate Revolving Credit Commitments shall be immediately reduced by the
aggregate amount of such Alternate Currency Commitments, and (iv) the Pro
Rata Share of the Revolving Credit Commitment of each Bank shall be
recalculated by the Agent taking into effect the reduced Revolving Credit
Commitment of such Alternate Currency Lender. After activation of any
Alternate Currency Commitment, the Borrower may from time to time
thereafter deactivate such Alternate Currency Commitment upon ten (10)
Business Days prior written notice to the Agent, specifying the Alternate
Currency Commitment which is being deactivated, the amount of the Alternate
Currency Commitment being deactivated stated in U.S. Dollars and the
requested date of such deactivation. Upon deactivation of such Alternate
Currency Commitment of any Alternate Currency Bank, (i) the amount of such
Alternate Currency Bank's Revolving Credit Commitment shall be immediately
increased by the amount of such Banks Alternate Currency Commitment
deactivated, (iii) the Aggregate Revolving Credit Commitments shall be
immediately increased by the aggregate amount of such Alternate Currency
Commitments deactivated, and (iv) the Pro Rata Share of the Revolving
Credit Commitment of each Bank shall be recalculated by the Agent taking
into effect the increased Aggregate Revolving Credit Commitments. The Agent
shall, upon any activation or deactivation under this Section 2.1(d),
distribute a revised Schedule 1.1 to all of the Banks which shall indicate
each Bank's Revolving Credit Commitment and, if any, Alternate Currency
Commitments, together with such Bank's Pro Rata Share of the Aggregate
Commitments and Aggregate Revolving Credit Commitments, which new Schedule
1.1 shall automatically supersede any prior Schedule 1.1. Alternate
Currency Commitments may be reactivated and deactivated from time to time
pursuant to this Section 2.1(d).
(e) Except as otherwise required by applicable law, in no event shall
the Agent or Alternate Currency Banks have the right to accelerate the
Alternate Currency Loans outstanding under any Alternate Currency Addendum
or to terminate their Alternate Currency Commitments (if any) thereunder to
make Alternate Currency Loans prior to the stated termination date in
respect thereof, except that (i) such Agent and Alternate Currency Banks
shall, in each case, have such rights upon an acceleration of the Loans and
a termination of the Commitments pursuant to Section 6.2, and (ii) an
Alternate Currency Bank may terminate its Alternate Currency Commitment
provided that such Alternate Currency Bank shall provide sixty (60) days
prior written notice of such termination to the Agent and the Company. On
the effective date of such termination, all Alternate Currency Loans owing
to such Alternate Currency Bank shall be paid in full.
18
(f) Upon the occurrence of an Event of Default under Section 6.1(a) or
6.1(i), each Bank shall be deemed to have purchased, without recourse or
warranty, participation interests in the other Bank's Advances (other than
Bid-Option Loans) and/or take such other reasonable actions and make such
other equitable adjustments among the Banks as reasonably agreed to by the
Banks, to ensure that each Bank holds a portion (its "Equalized Share") of
the aggregate Advances (excluding any outstanding Bid-Option Loans)
determined based on such Bank's Pro Rata Share (determined based on the
Aggregate Commitments), it being the intent of the Banks that following
such participations, equalization payments and other actions in connection
therewith, each Bank shall hold, whether through participation or directly,
a share of the aggregate Advances (other than Bid-Option Loans) equal to
its Equalized Share. The Banks and the Agent agree to promptly execute any
further documents and make such payments, if any, among themselves to
accomplish such equalization.
(g) Effect on Commitments. Notwithstanding anything in this Agreement
to the contrary, the sum of the aggregate outstanding principal amount of
all Revolving Credit Loans plus, all Letter of Credit Advances (being the
maximum amount available to be drawn under the related Letters of Credit
plus the amount of any draws under Letters of Credit that have not been
reimbursed) plus, all Alternate Currency Loans, plus all Bid-Option Loans
plus, all Swing Loans shall not at any time exceed the aggregate amount of
the Aggregate Commitments of all Banks. Each Bank's obligation to make its
pro rata portion of any subsequently requested Revolving Credit Loan or
Letter of Credit Advance shall not be affected by the making by such Bank
of a Bid-Option Loan, and the Bank which has outstanding Bid-Option Loans
and/or Alternate Currency Loans may be obligated to exceed its Commitment,
and provided, that, as stated above, the aggregate principal amount of all
Revolving Credit Loans, all Letters of Credit Advances, all Alternate
Currency Loans, all Swing Loans and all Bid-Option Loans shall not at any
time exceed the Aggregate Commitments.
(h) Effective Date. This Agreement and the Commitments hereunder shall
be effective, subject to Section 2.7, as of the Effective Date, provided,
that, the Borrowers may give notice of a request for an Advance as of
January 10, 2005 for purposes of satisfying the notice requirements for
requests for Advances and Section 3.8 shall be effective as of January 10,
2005.
2.2 Bid-Option Loans.
(a) The Bid-Option. From the Effective Date to but excluding the
Termination Date, the Treasury Manager may, as set forth in this Section
2.2, request the Banks to make offers to make Bid-Option Loans to a
Designated Borrower. Each Bank may, but shall have no obligation to, make
such offers and such Designated Borrower may, but shall have no obligation
to, accept any such offers, in the manner set forth in this Section 2.2;
furthermore, each Bank may limit the aggregate amount of Bid-Option Loans
when quoting rates for more than one Bid-Option Interest Period in any
Bid-Option Quote, provided that such limitation shall not be less than the
minimum amounts required hereunder for Bid-Option Loans and the Designated
Borrower may choose among the Bid-Option Loans if such limitation is
imposed; provided, that the aggregate outstanding principal amount of
Bid-Option Loans shall not at any time exceed the lower of (i) the excess
of (A) the aggregate amount of the Commitments over (B) the sum of the
aggregate outstanding principal amount of Advances or (ii) $200,000,000;
(b) Bid-Option Quote Request. When the Treasury Manager wishes to
request offers to make Bid-Option Loans under this Section 2.2, it shall
transmit to the Agent by telex or telecopy a Bid-Option Quote Request
substantially in the form of Exhibit E hereto so as to be received no later
than (i) 10:00 a.m. Chicago time at least four Eurocurrency Business Days
prior to the date of the Loan proposed therein, in the case of a
Eurocurrency Auction, or (ii) 9:00 a.m. Chicago time on the Business Day
19
next preceding the date of the Loan proposed therein in the case of an
Absolute Rate Auction, specifying:
(i) the proposed date of the Bid-Option Loan, which shall be a
Business Day;
(ii) the Designated Borrower;
(iii) the aggregate amount of such Bid-Option Loan, which shall
be a minimum of $5,000,000 or a larger multiple of $1,000,000;
(iv) whether such borrowings are to set forth a Competitive Bid
Margin or an Absolute Rate, or both; and
(v) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period.
A Borrower may request offers to make Bid-Option Loans for more than
one Bid-Option Interest Period and for a Eurocurrency Auction and an
Absolute Rate Auction in a single Bid-Option Quote Request. No Bid
Quote Request shall be given within 5 Business Days (or such other
number of days as the Company and the Agent may agree) of any other
Bid Quote Request. A Bid Quote Request that does not conform
substantially to the format of Exhibit E hereto shall be rejected, and
the Agent shall promptly notify the Company of such rejection.
(c) Invitation for Bid-Option Quotes. Promptly upon receipt of a
Bid-Option Quote Request, the Agent shall send to the Banks by
telecopy (or telephone promptly confirmed by telecopy) an Invitation
for Bid-Option Quotes substantially in the form of Exhibit F hereto,
which shall constitute an invitation by the Treasury Manager and the
Designated Borrower to each Bank to submit Bid-Option Quotes offering
to make the Bid-Option Loans to which such Bid-Option Quote Request
relates in accordance with this Section 2.2.
(d) Submission and Contents of Bid-Option Quotes.
(i) Each Bank may submit a Bid-Option Quote containing an offer
or offers to make Bid-Option Loans in response to any Invitation for
Bid-Option Quotes. Each Bid-Option Quote must comply with the
requirements of this subsection (d) and must be submitted to the Agent
by telecopy (or by telephone promptly confirmed by telecopy) at its
office referred to in Section 8.2 not later than (A) 9:30 a.m. Chicago
time at least three Eurocurrency Business Days prior to the proposed
date of the Borrowing in the case of an Eurocurrency Auction, or (B)
9:30 a.m. Chicago time on the proposed date of the Borrowing in the
case of an Absolute Rate Auction; provided that Bid-Option Quotes
submitted by the Agent (or any Affiliate of the Agent) in the capacity
of a Bank may be submitted, and may only be submitted, if the Agent or
such Affiliate notifies the Borrower of the terms of the offer or
offers contained therein not later than 15 minutes prior to the latest
time at which the relevant Bid-Option Quotes must be submitted by the
other Banks. Subject to Article VI, any Bid-Option Quote so made shall
be irrevocable except with the written consent of the Agent given on
the instructions of the Treasury Manager.
(ii) Each Bid-Option Quote shall be in substantially the form of
Exhibit G hereto, but may be submitted to the Agent by telephone with
prompt confirmation by delivery to the Agent of such written
Bid-Option Quote, and shall in any case specify:
20
(A) the proposed date of the Borrowing;
(B) the principal amount of the Bid-Option Loan for which
each such offer is being made, which principal amount (x) must be
in a minimum of $5,000,000 or a larger multiple of $1,000,000,
and (y) may not exceed the principal amount of the Bid-Option
Loans for which offers were requested;
(C) in the case of a Eurocurrency Auction, the Competitive
Bid Margin offered for each such Bid-Option Loan,
(D) the minimum amount, if any, of the Bid-Option Loan which
may be accepted by the Borrower,
(E) in the case of an Absolute Rate Auction, the Absolute
Rate offered for each such Bid-Option Loan,
(F) the maximum aggregate amount, if any, of Bid-Option
Loans offered by the quoting Bank which may be accepted by the
Borrower, and
(G) the identity of the quoting Bank.
(iii) Any Bid-Option Quote shall be disregarded if it:
(A) is not substantially in the form of Exhibit G hereto (or
is not submitted by telephone to the Agent with prompt written
confirmation to follow) or does not specify all of the
information required by clause (ii) of this subsection (d);
(B) contains qualifying, conditional or similar language,
other than any such language contained in Exhibit G hereto;
(C) proposes terms other than or in addition to those set
forth in the applicable Invitation for Bid-Option Quotes; or
(D) arrives after the time set forth in Section 2.2(d)(i);
provided that a Bid-Option Quote shall not be disregarded pursuant to
clause (B) or (C) above solely because it contains an indication that
an allocation that might otherwise be made to it pursuant to Section
2.2(g) would be unacceptable. The Agent shall notify the Treasury
Manager of any disregarded Bid-Option Quote.
(e) Notice to Borrower. The Agent shall promptly notify the Treasury
Manager of the terms of any Bid-Option Quote submitted by a Bank that is in
accordance with Section 2.2(d). Any Bid-Option Quote not made in accordance
with Section 2.2(d) shall be disregarded by the Agent. The Agent's notice
to the Treasury Manager shall specify (i) the aggregate principal amount of
Bid-Option Loans for which offers have been received for each Bid-Option
Interest Period specified in the related Bid-Option Quote Request, and (ii)
the respective principal amounts and Eurocurrency Bid Rates or Absolute
Rates, as the case may be, so offered.
21
(f) Acceptance and Notice by Borrower. Not later than (i) 10:30 a.m.
Chicago time at least three Eurocurrency Business Days prior to the
proposed Borrowing date, in the case of a Eurocurrency Auction or (ii)
10:30 a.m. Chicago time on the proposed Borrowing date, in the case of an
Absolute Rate Auction, the Treasury Manager shall notify the Agent of the
Designated Borrower's acceptance or non-acceptance of the offers so
notified to it pursuant to subsection (e) of this Section provided,
however, that the failure by the Treasury Manager to give such notice to
the Agent shall be deemed to be a rejection of all such offers. In the case
of acceptance, such notice (a "Notice of Bid-Option Loan") shall specify
the aggregate principal amount of offers for the applicable Interest
Period(s) that have been accepted. The Borrower may accept any Bid-Option
Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Bid-Option Loan may
not exceed the applicable amount set forth in the related Bid-Option
Quote Request for the applicable Bid-Option Interest Period;
(ii) the principal amount of each Bid-Option Loan must be
$5,000,000 or a larger multiple of $1,000,000;
(iii) acceptance of offers may only be made on the basis of
ascending Eurocurrency Bid Rates or Absolute Rates, as the case may
be; and
(iv) the Borrower may not accept any offer that is described in
Section 2.2(d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Agent. If offers are made by two or more Banks with
the same Eurocurrency Bid Rates or Absolute Rates, as the case may be for a
greater aggregate principal amount than the amount in respect of which
offers are accepted for the related Interest Period, the principal amount
of Bid-Option Loans in respect of which such offers are accepted shall be
allocated by the Agent among such Banks as nearly as possible (in such
multiples, not greater than $100,000, as the Agent may deem appropriate) in
proportion to the aggregate principal amount of such offers; provided,
however, that no Bank shall be allocated a portion of any Bid-Option Loan
which is less than the minimum amount which such Bank has indicated that it
is willing to accept. Determinations by the Agent of the amounts of
Bid-Option Loans shall be conclusive in the absence of manifest error. The
Agent shall promptly, but in any event on the same Business Day, notify
each Bank of its receipt of a Notice of Bid-Option Loan and the aggregate
principal amount of such Bid-Option Loan allocated to each participating
Bank.
2.3 Swing Loans.
(a) Making of Swing Loans. The Agent may elect in its sole discretion
to make revolving loans (the "Swing Loans") to the Borrowers from time to
time prior to the Termination Date in Dollars or any Foreign Currency up to
an aggregate Dollar Equivalent at any one time outstanding not to exceed
the lesser of $40,000,000 or the unused amount of the aggregate Revolving
Credit Commitments. The Agent may make Swing Loans (provided that the Agent
has received a request in writing or via telephone from the Treasury
Manager for funding of a Swing Loan) no later than such time required by
the Agent, on the Business Day on which such Swing Loan is requested to be
made in the case of Swing Loans in Dollars and on such number of Business
Days agreed to between the Agent and the Company after such Swing Loan is
requested to be made in the case of Swing Loans in any Foreign Currency.
Each outstanding Swing Loan and interest thereon shall be payable on the
Business Day following demand therefor, but no later than thirty (30) days
after disbursement of such Swing Loan, with interest at such rate as the
Borrower requesting such Swing Loan and the Agent shall agree, and shall
otherwise be subject to all the terms and conditions applicable to Loans,
except that all interest thereon shall be payable to the Agent solely for
22
its own account. Repayment of any Swing Loan may, subject to the terms and
conditions of this Agreement, be accomplished through a request by the
relevant Borrower for a Revolving Credit Loan.
(b) Swing Loan Borrowing Requests. Upon request of the Agent, the
Treasury Manager agrees to deliver promptly to the Agent a written
confirmation of each telephonic notice for Swing Loans. If the written
confirmation differs in any material respect from the action taken by the
Agent, the records of the Agent shall govern, absent manifest error.
(c) Repayment of Swing Loans. At any time after making a Swing Loan,
the Agent may request a Borrower to, and upon request by the Agent such
Borrower shall, promptly request a Revolving Credit Loan from all the Banks
and apply the proceeds of such Revolving Credit Loan to the repayment of
any Swing Loan owing by such Borrower not later than three Business Days
following the Agent's request. Notwithstanding the foregoing, upon the
earliest to occur of (a) one Business Day after demand is made by the
Agent, (b) the date a Swing Loan is to be refunded with a Revolving Credit
Loan, and (c) the Termination Date, the Borrower agrees that each Swing
Loan outstanding in a Foreign Currency shall be immediately and
automatically converted to and redenominated in Dollars equal to the Dollar
Equivalent of each such Swing Loan determined as of the date of such
conversion, and each Bank (other than the Agent) shall irrevocably and
unconditionally purchase from the Agent, without recourse or warranty, an
undivided interest and participation in such Swing Loan in an amount equal
to such Bank's Pro Rata Share of such Swing Loan and promptly pay such
amount to the Agent in immediately available funds. Such payment shall be
made by the other Banks whether or not a Default or Event of Default is
then continuing or any other condition precedent set forth in Section 2.8
is then met and whether or not the Borrower has then requested an Advance
in such amount; and such Swing Loan shall thereupon be deemed to be a
Floating Rate Loan hereunder made on the date of such purchase (except, as
aforesaid, with respect to the existence of any Default or Event of Default
or the meeting of any condition precedent specified in Section 2.8 on such
date). If any Bank fails to make available to the Agent any amounts due to
the Agent pursuant to this Section, the Agent shall be entitled to recover
such amount, together with interest thereon at the Federal Funds Effective
Rate for the first three Business Days after such Bank receives notice of
such required purchase and thereafter, at the Floating Rate, payable (i) on
demand, (ii) by setoff against any payments made to the Agent for the
account of such Bank or (iii) by payment to the Agent by the Agent of
amounts otherwise payable to such Bank under this Agreement. The failure of
any Bank to make available to the Agent its Pro Rata Share of any unpaid
Swing Loan shall not relieve any other Bank of its obligation hereunder to
make available to the Agent its Pro Rata Share of any unpaid Swing Loan on
the date such payment is to be made, but no Bank shall be responsible for
the failure of any other Bank to make available to the Agent its Pro Rata
Share of any unpaid Swing Loan.
2.4 Termination and Reduction of Commitments; Increases of
Commitments.
(a) The Company shall have the right to terminate or reduce the
Commitments at any time and from time to time at its option, provided that
(i) the Treasury Manager shall give three Business Days prior written
notice of such termination or reduction to the Agent (with sufficient
executed copies for each Bank) specifying the amount and effective date
thereof, (ii) each partial reduction of the Commitments shall be in a
minimum amount of $10,000,000 and in integral multiples thereof and shall
reduce the Commitments of all of the Banks proportionately in accordance
with the respective commitment amounts for each such Bank set forth in the
signature pages hereof next to the name of each such Bank, (iii) no such
termination or reduction shall be permitted with respect to any portion of
the Commitments as to which a request for a Borrowing pursuant to Section
2.6 is then pending, (iv) the Commitments may not be terminated if any
23
Advances are then outstanding and may not be reduced below the principal
amount of Advances then outstanding, (v) each partial reduction of any
Alternate Currency Commitments with respect to any Alternate Currency shall
be in a minimum amount of $1,000,000 and in an integral multiple thereof
and shall reduce the applicable Alternate Currency Commitments with respect
to such Alternate Currency of all of the applicable Banks party thereto
proportionately in accordance with such respective Alternative Currency
Commitments of each such Bank, and (vi) no such termination or reduction
shall be permitted with respect to any portion of any Alternate Currency
Commitments as to which a request for a Borrowing is then pending. The
Commitments or any portion thereof terminated or reduced pursuant to this
Section 2.4(a), whether optional or mandatory, may not be reinstated, other
than any reduction of the Revolving Credit Commitment in connection with
the activation of an Alternate Currency Commitment pursuant to Section
2.1(d). The Borrowers shall immediately prepay the applicable Advances to
the extent they exceed the applicable reduced aggregate Commitments
pursuant hereto.
(b) For purposes of this Agreement, a Letter of Credit Advance (i)
shall be deemed outstanding in an amount equal to the sum of the maximum
amount available to be drawn under the related Letter of Credit on or after
the date of determination and on or before the stated expiry date thereof
plus the amount of any draws under such Letter of Credit that have not been
reimbursed and (ii) shall be deemed outstanding at all times on and before
such stated expiry date or such earlier date on which all amounts available
to be drawn under such Letter of Credit have been fully drawn, and
thereafter until all related reimbursement obligations have been paid. Upon
each payment made by the Agent in respect of any draft or other demand for
payment under any Letter of Credit, the amount of any Letter of Credit
Advance outstanding immediately prior to such payment shall be
automatically reduced by the amount of each Revolving Credit Loan deemed
advanced in respect of the related reimbursement obligation of the
Borrower.
(c) Subject to the conditions set forth below, the Company may, upon
at least thirty (30) days prior written notice to the Agent and the Banks,
increase the Aggregate Commitments from time to time, either by designating
a bank not theretofore a Bank to become a Bank (such designation to be
effective only with the prior written consent (such consent not to be
unreasonably withheld) of the Agent) or by agreeing with an existing Bank
that such Bank's Commitment shall be increased (thus increasing the
Aggregate Commitments); provided that:
(i) no Default shall have occurred and be continuing hereunder as
of the effective date of such increase;
(ii) the representations and warranties made by the Borrowers and
contained in Article IV shall be true and correct in all material
respects on and as of the effective date with the same effect as if
made on and as of such date (other than those representations and
warranties that by their terms speak as of a particular date, which
representations and warranties shall be true and correct as of such
particular date);
(iii) the amount of such increase in the Aggregate Commitments
shall not be less than $10,000,000, and shall not cause the Aggregate
Commitments to exceed $550,000,000;
(iv) The Borrowers and the Bank or bank not theretofore a Bank,
shall execute and deliver to the Agent, a Bank Addition and
Acknowledgement Agreement, in form and substance satisfactory to the
Agent and acknowledged by the Agent and each Borrower and the Company
shall have delivered to the Agent copies of authorizing resolutions
and evidence of other corporate action taken by the Company to
authorize the increase in the Aggregate Commitments;
24
(v) no existing Bank shall be obligated in any way to increase
its Commitment;
(vi) the Agent shall consent (such consent not to be unreasonably
withheld) to such increase and the Borrowers shall have complied with
such other conditions in connection with such increase as may be
required by the Agent.
(d) Upon the execution, delivery, acceptance and recording of the Bank
Addition and Acknowledgement Agreement, from and after the effective date
specified in a Bank Addition and Acknowledgement Agreement, such existing
Bank shall have a Commitment as therein set forth or such other Bank shall
become a Bank with a Commitment as therein set forth and all the rights and
obligations of a Bank with such a Commitment hereunder.
(e) Upon its receipt of a Bank Addition and Acknowledgement Agreement,
subject to such addition and assumption and the written consent to such
addition and assumption, the Agent shall, if such Bank Addition and
Acknowledgement Agreement has been completed and the other conditions
described in this Section 2.4 have been satisfied:
(i) accept such Bank Addition and Acknowledgement Agreement;
(ii) record the information contained therein in the Register;
and
(iii) give prompt notice thereof to the Banks and the Borrowers
and deliver to the Banks a revised Schedule 1.1 reflecting the new
Commitments (including the new Revolving Credit Commitments and, if
any, the Alternate Currency Commitments), which new Schedule 1.1 shall
automatically supersede any prior Schedule 1.1.
2.5 Fees.
(a) The Company agrees to pay to the Banks a facility fee on the
amount of the Commitments on a per diem basis, whether or not activated and
whether used or unused, for the period from the Effective Date to but
excluding the Termination Date, at a rate equal to the Applicable Fee Rate
for the facility fee. Accrued facility fees shall be payable quarterly in
arrears in Dollars within five (5) days of receipt of an invoice prepared
by the Agent and promptly delivered to the Company containing a computation
of facility fees due computed on the basis of 360 days and assessed for the
actual number of days elapsed, which invoice shall be prepared as of the
last Business Day of each March, June, September and December, commencing
on March 31, 2005 and on the Termination Date. Notwithstanding the
foregoing, with respect to payment of the facility fee on any portion of
the Commitments designated as an Alternate Currency Commitment, the Company
may, in its discretion, cause payment of the facility fee on any such
Alternate Currency Commitment to be made by the relevant Borrower under
such Alternate Currency Commitment.
(b) The Borrowers agree to pay with respect to Letters of Credit (i) a
fee to the Banks computed at the Applicable Fee Rate for Letters of Credit
on the maximum amount available to be drawn from time to time under such
Letter of Credit for the period from and including the date of issuance of
such Letter of Credit to and including the stated expiry date of such
Letter of Credit, which fee shall be paid annually in advance at the time
such Letter of Credit is issued or amended, and (ii) a fee to the Agent for
its own account computed at the rate of 0.125% per annum of such maximum
amount for such period. Such fees are nonrefundable and the Borrowers shall
25
not be entitled to any rebate of any portion thereof if such Letter of
Credit does not remain outstanding through its stated expiry date or for
any other reason. The Borrowers further agree to pay to the Agent, on
demand, such other customary and reasonable administrative fees, charges
and expenses of the Agent in respect of the issuance, negotiation,
acceptance, amendment, transfer and payment of such Letter of Credit or
otherwise payable pursuant to the application and related documentation
under which such Letter of Credit is issued in accordance with a schedule
of fees provided by the Agent to the Borrowers.
(c) The Borrowers agree to pay to the Agent an agency fee for its
services as Agent under this Agreement in such amounts as may from time to
time be agreed upon by the Borrowers and the Agent.
2.6 Disbursement of Advances.
(a) Except with respect to Swing Loans, the Treasury Manager shall
give the Agent notice of its request for each Advance in substantially the
form of Exhibit H hereto not later than 10:00 a.m. local time of the
Applicable Lending Installation (i) three Eurocurrency Business Days prior
to the date such Advance is requested to be made if such Borrowing is to be
made as a Eurocurrency Rate Loan, (ii) five Business Days prior to the date
any Letter of Credit Advance is requested to be made, (iii) at such time
prior to the date such Advance is requested to be made as specified in the
applicable Alternate Currency Addendum if such Borrowing is to be made as
an Alternate Currency Loan and (iv) on the date such Loan is requested to
be made in all other cases, which notice shall specify the Designated
Borrower for which such Advance is requested, whether a Eurocurrency Rate
Loan, Floating Rate Loan, Alternate Currency Loan or a Letter of Credit
Advance is requested and, in the case of each requested Eurocurrency Rate
Loan, the Eurocurrency Interest Period to be initially applicable to such
Loan and the Foreign Currency in which such Loan is to be denominated, and,
in the case of each requested Alternate Currency Loan, such other
information as may be required pursuant to the applicable Alternate
Currency Addendum. The Agent, on the same day any such notice is given,
shall provide notice of such requested Revolving Credit Loan to each Bank.
Subject to the terms and conditions of this Agreement, the proceeds of each
such requested Revolving Credit Loan shall be made available to the
Borrower requesting such Loan by depositing the proceeds thereof, in
immediately available funds, in the case of any Loan denominated in Dollars
in an account maintained and designated by such Borrower at the principal
office of the Agent, and, in all other cases, in an account maintained and
designated by such Borrower at the Applicable Lending Installation of the
Agent for such Borrower, at a bank acceptable to the Agent in the principal
financial center of the country issuing the Foreign Currency in which such
Loan is denominated or at such other place specified by the Agent. Subject
to the terms and conditions of this Agreement, the Agent shall, on the date
any Letter of Credit Advance is requested to be made, issue the related
Letter of Credit on behalf of the Banks for the account of the Borrower
requesting such Letter of Credit. Notwithstanding anything herein to the
contrary, the Agent may decline to issue any requested Letter of Credit on
the basis that the beneficiary, the purpose of issuance or the terms or the
conditions of drawing are unacceptable to it based upon any legal concerns
in its reasonable discretion or upon any policy of the Agent.
(b) Each Bank, on the date any Revolving Credit Loan is requested to
be made, shall make its pro rata share of such Revolving Credit Loan
available in immediately available, freely transferable cleared funds for
disbursement to the Designated Borrower requesting such Loan pursuant to
the terms and conditions of this Agreement, in the case of any Revolving
Credit Loan denominated in Dollars, at the principal office of the Agent
and, in all other cases, to the account of the Agent at its designated
branch or correspondent bank in the country issuing such Foreign Currency
in which such Loan is denominated or at such other place specified by the
Agent. Unless the Agent shall have received notice from any Bank prior to
the date such Revolving Credit Loan is requested to be made under this
Section 2.6 that such Bank will not make available to the Agent such Bank's
pro rata portion of such Loan, the Agent may assume that such Bank has made
26
such portion available to the Agent on the date such Loan is requested to
be made in accordance with this Section 2.6. If and to the extent such Bank
shall not have so made such pro rata portion available to the Agent, the
Agent may (but shall not be obligated to) make such amount available to
such Designated Borrower, and such Bank agrees to pay to the Agent
forthwith on demand such amount together with interest thereon, for each
day from the date such amount is made available to such Designated Borrower
by the Agent until the date such amount is repaid to the Agent, at a rate
per annum equal to the Federal Funds Rate or the Agent's cost of funds with
respect to Foreign Currencies other than Dollars. If such Bank shall pay
such amount to the Agent together with interest, such amount so paid shall
constitute a Revolving Credit Loan by such Bank as part of the related
Borrowing for purposes of this Agreement. The failure of any Bank to make
its pro rata portion of any such Borrowing available to the Agent shall not
relieve any other Bank of its obligation to make available its pro rata
portion of such Loan on the date such Loan is requested to be made, but no
Bank shall be responsible for failure of any other Bank to make such pro
rata portion available to the Agent on the date of any such Loan.
(c) (i) Each Bank shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of each
Borrower to such Bank resulting from each Loan of such Bank from time
to time, including the amounts of principal and interest payable
thereon and paid to such Bank from time to time under this Agreement.
(ii) The Agent shall maintain an account for each Borrower in its
books and records with a subaccount for each Bank, in which shall be
recorded (a) the amount of each Loan made hereunder, the type thereof
and each Interest Period applicable thereto, (b) the amount of any
principal or interest due and payable or to become due and payable
from each Borrower to each Bank hereunder in respect of the Loans and
(c) both the amount of any sum received by the Agent hereunder from
each Borrower in respect of the Loans and each Bank's share thereof.
(iii) The books and records of the Agent and of each Bank
maintained pursuant to this Section 2.6(c) shall, to the extent
permitted by applicable law, be prima facie evidence of the existence
and amounts of the obligations of each Borrower therein recorded;
provided, however, that the failure of any Bank or the Agent to
maintain any such books and records or any error therein, shall not in
any manner affect the obligation of each Borrower to repay (with
applicable interest) the Loans made to such Borrower by such Bank in
accordance with the terms of this Agreement.
(iv) Any Bank may request that Loans made by it be evidenced by a
promissory note. In such event, each Borrower shall execute and
deliver to such Lender a promissory note payable to the order of such
Bank (or, if requested by such Bank, to such Bank and its registered
assigns) and in a form approved by the Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all
times (including after assignment pursuant to Section 8.6) be
represented by one or more promissory notes in such form payable to
the order of the payee named therein (or, if such promissory note is a
registered note, to such payee and its registered assigns).
(v) Subject to the terms and conditions of this Agreement, each
Borrower may borrow Loans under this Section 2.6, prepay Loans
pursuant to Section 3.1 and reborrow Loans under this Section 2.6.
(d) All Bid-Option Loans shall be disbursed directly by the Bank
making such Bid-Option Loan to the Designated Borrower by 1:30 p.m. Chicago
time on the date such Bid-Option Loan is requested to be made via wire
transfer in immediately available funds to JPMorgan Chase Bank, N.A., 1
27
Bank ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ABA Number ▇▇▇▇▇▇▇▇▇, Attention:
Agency Administration, Reference: Invacare Bid-Option, confirm to Agency
Administration, Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ or as otherwise directed by
the Borrowers.
(e) Nothing in this Agreement shall be construed to require or
authorize any Bank to issue any Letter of Credit, it being recognized that
the Agent has the sole obligation under this Agreement to issue Letters of
Credit on behalf of the Banks, and the Commitment of each Bank with respect
to Letter of Credit Advances is expressly conditioned upon the Agent's
performance of such obligations. Upon such issuance by the Agent, each Bank
shall automatically acquire a pro rata risk participation interest in such
Letter of Credit Advance based on the amount of its respective Revolving
Credit Commitment. If the Agent shall honor a draft or other demand for
payment presented or made under any Letter of Credit, the Agent shall
provide notice thereof to each Bank (which notice shall be provided by 2:00
p.m. Chicago time) on the date such draft or demand is honored unless a
Borrower shall have satisfied its reimbursement obligation by payment to
the Agent on such date. Each Bank, on such date, shall make its pro rata
share of the amount paid by the Agent available in immediately available
funds at the principal office of the Agent for the account of the Agent. If
and to the extent such Bank shall not have made such pro rata portion
available to the Agent, such Bank and the Borrowers severally agree to pay
to the Agent forthwith on demand such amount together with interest
thereon, for each day from the date such amount was paid by the Agent until
such amount is so made available to the Agent at a per annum rate equal to
the Federal Funds Rate or the Agent's cost of funds with respect to
Permitted Currencies other than Dollars. If such Bank shall pay such amount
to the Agent together with such interest, such amount so paid shall
constitute a Revolving Credit Loan by such Bank as part of the Revolving
Credit Borrowing disbursed in respect of the reimbursement obligation of
the Company for purposes of this Agreement. The failure of any Bank to make
its pro rata portion of any such amount paid by the Agent available to the
Agent shall not relieve any other Bank of its obligation to make available
its pro rata portion of such amount, but no Bank shall be responsible for
failure of any other Bank to make such pro rata portion available to the
Agent.
(f) All notifications by the Agent to each applicable Alternate
Currency Bank of each request for an Alternate Currency Loan, the
procedures under which each Alternate Currency Bank shall make its
Alternate Currency Loans available, the procedures by which the Agent will
make the Alternate Currency Loans available to the applicable Borrower, any
instruments evidencing the Alternate Currency Loans and other related
procedures with respect to the Alternate Currency Loans shall be as set
forth in the applicable Alternate Currency Addendum.
2.7 Conditions for Closing and First Disbursement. The effectiveness
of this Agreement and the obligation of each Bank to make its first Advance
hereunder is subject to receipt by each Bank and the Agent of the following
documents and completion of the following matters, in form and substance
reasonably satisfactory to each Bank and the Agent:
(a) Charter Documents. Certificates of recent date of the appropriate
authority or official of the Company's state of incorporation listing all
charter documents of the Company, on file in that office and certifying as
to the good standing and corporate existence of the Company, together with
copies of such charter documents of the Company, certified as of a recent
date by such authority or official and certified as true and correct as of
the Effective Date by a duly authorized officer of the Company;
(b) By-Laws and Corporate Authorizations. Copies of the by-laws of the
Company together with all authorizing resolutions and evidence of other
corporate action taken by the Company to authorize the execution, delivery
28
and performance by the Company of this Agreement and the other Loan
Documents and the consummation by the Company of the transactions
contemplated hereby, certified as true and correct as of the Effective Date
by a duly authorized officer of the Company;
(c) Incumbency Certificate. Certificates of incumbency of each
Borrower containing, and attesting to the genuineness of, the signatures of
those officers authorized to act on behalf of such Borrower in connection
with this Agreement and the other Loan Documents and the consummation by
such Borrower of the transactions contemplated hereby, certified as true
and correct as of the Effective Date by a duly authorized officer of each
Borrower;
(d) Loan Documents. Execution and delivery to the Agent by each of the
parties thereto of this Agreement and any other required Loan Documents
(including the Guaranty);
(e) Legal Opinion. The favorable written opinion of counsel for the
Company in the form of Exhibit I attached hereto;
(f) Consents, Approvals, Etc. Copies of all governmental and
nongovernmental consents, approvals, authorizations, declarations,
registrations or filings, if any, required on the part of the Company in
connection with the execution, delivery and performance of this Agreement,
the Guaranty and the other Loan Documents or the transactions contemplated
hereby or as a condition to the legality, validity or enforceability of
this Agreement and the other Loan Documents, certified as true and correct
and in full force and effect as of the Effective Date by a duly authorized
officer of the Company, or, if none are required, a certificate of such
officer to that effect;
(g) 2001 Credit Agreement and Bridge Credit Agreement. All
indebtedness and obligations pursuant to the 2001 Credit Agreement and the
Bridge Credit Agreement shall be paid in full simultaneously with the first
Advance hereunder, and the Company and the other Borrowers hereby terminate
all commitments to lend under the 2001 Credit Agreement and the Company
hereby terminates all commitments to lend under the Bridge Credit
Agreement;
(h) Solvency and Compliance Certificates. A solvency certificate duly
executed by the Company in form and substance satisfactory to the Agent and
an opening compliance certificate in the form attached hereto as Exhibit J
duly executed by the Company; and
(i) Miscellaneous. Such other agreements and documents, and the
satisfaction of such other conditions as may reasonably be required by the
Agent or the Required Banks, including without limitation such funding
instructions, sources and uses certificates, opinions of foreign counsel,
evidence satisfactory to the Agent that the Advances hereunder are made in
compliance with all applicable laws and regulations, including without
limitation Regulations T, U and X of the Board of Governors of the Federal
Reserve System.
2.8 Further Conditions for Disbursement. The obligation of each Bank
to make any Advance (including its first Advance), or any continuation or
conversion under Section 2.9, is further subject to the satisfaction of the
following conditions precedent:
(a) The representations and warranties contained in Article IV hereof
and in any other Loan Document shall be true and correct in all material
respects on and as of the date such Advance is made, continued or converted
(both before and after such Advance is made, continued or converted) as if
such representations and warranties were made on and as of such date; and
29
(b) No Event of Default and no Default shall exist or shall have
occurred and be continuing on the date such Advance is made, continued or
converted (whether before or after such Advance is made, continued or
converted);
(c) Prior to the issuance of the initial Letter of Credit Advance, the
Borrowers, the Agent and the Banks shall have entered into an agreement
containing terms and conditions regarding Letters of Credit, which
agreement shall be mutually satisfactory to all parties thereto.
(d) In the case of any Letter of Credit Advance, the Borrower
requesting such Letter of Credit Advance shall have delivered to the Agent
an application for the related Letter of Credit and other related
documentation requested by and acceptable to the Agent and the Banks
appropriately completed and duly executed on behalf of such Borrower and
the Agent and the Banks shall have negotiated all fees described in Section
2.5(b).
(e) Prior to any Advance to any Borrowing Subsidiary, such Borrowing
Subsidiary shall deliver such corporate or organizational documents and
authorizing resolutions and legal opinions as reasonably requested by the
Agent and such Borrowing Subsidiary and the Borrowers shall execute all
agreements and take such other action reasonably requested by the Agent for
such Borrowing Subsidiary to become a Borrowing Subsidiary hereunder.
Each Borrower shall be deemed to have made a representation and warranty to
the Banks at the time of the making of, and the continuation or conversion
of, each Advance to the effects set forth in clauses (a) and (b) of this
Section 2.8. For purposes of this Section 2.8, the representations and
warranties contained in Section 4.6 hereof shall be deemed made with
respect to the most recent financial statements delivered pursuant to
Section 5.1(d)(ii) and (iii).
2.9 Subsequent Elections as to Borrowings. The Treasury Manager may
elect (a) to continue a Fixed Rate Revolving Credit Borrowing of one type,
or a portion thereof, as a Fixed Rate Revolving Credit Borrowing of the
then existing type, or (b) may elect to convert a Fixed Rate Revolving
Credit Borrowing, or a portion thereof, to a Borrowing of another type or
(c) elect to convert a Floating Rate Borrowing, or a portion thereof, to a
Fixed Rate Revolving Credit Borrowing, in each case by giving notice
thereof to the Agent in substantially the form of Exhibit K hereto at the
principal office of the Agent and at the Applicable Lending Installation of
the Agent with respect to such Loan not later than 10:00 a.m. local time of
the Applicable Lending Installation (i) three (3) Eurocurrency Business
Days prior to the date any such continuation of or conversion to a
Eurocurrency Rate Revolving Credit Borrowing is to be effective and (ii)
the date such continuation or conversion is to be effective in all other
cases, provided that an outstanding Fixed Rate Revolving Credit Borrowing
may only be converted on the last day of the then current Interest Period
with respect to such Borrowing, and provided, further, if a continuation of
a Borrowing as, or a conversion of a Borrowing to, a Fixed Rate Revolving
Credit Borrowing is requested, such notice shall also specify the Interest
Period to be applicable thereto upon such continuation or conversion. The
Agent, on the day any such notice is given, shall provide notice of such
election to the Banks. If the Treasury Manager shall not timely deliver
such a notice with respect to any outstanding Fixed Rate Revolving Credit
Borrowing, the Borrower shall be deemed to have elected with respect to any
Loan denominated in Dollars, to convert such Fixed Rate Revolving Credit
Borrowing to a Floating Rate Borrowing on the last day of the then current
Interest Period with respect to such Borrowing and, with respect to any
other Loan, to continue such Loan as a Fixed Rate Borrowing of the same
type with an Interest Period of one month on the last day of the then
current Interest Period with respect to such Borrowing.
30
2.10 Limitation of Requests and Elections. Notwithstanding any other
provision of this Agreement to the contrary, if, upon receiving a request
for a Fixed Rate Revolving Credit Borrowing pursuant to Section 2.6, or a
request for a continuation of a Fixed Rate Revolving Credit Borrowing as a
Fixed Rate Revolving Credit Borrowing of the then existing type, or a
request for a conversion of a Floating Rate Borrowing to a Fixed Rate
Revolving Credit Borrowing pursuant to Section 2.9, (a) in the case of any
Eurocurrency Rate Borrowing, deposits in the relevant Permitted Currency
for periods comparable to the Interest Period elected by the Borrower are
not available to any Bank in the relevant interbank or secondary market and
such Bank has provided to the Agent and the Borrowers a certificate
prepared in good faith to that effect, or (b) any Bank reasonably
determines that the applicable interest rate (net of the Applicable Margin
for the Eurocurrency Rate) will not adequately and fairly reflect the cost
to such Bank of making, funding or maintaining the related Fixed Rate
Revolving Credit Loan and such Bank has provided to the Agent and the
Borrowers a certificate prepared in good faith to that effect, or (c) by
reason of national or international financial, political or economic
conditions or by reason of any applicable law, treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect, or the
interpretation or administration thereof by any governmental authority
charged with the interpretation or administration thereof, or compliance by
any Bank with any directive of such authority (whether or not having the
force of law), including without limitation exchange controls, it is
impracticable, unlawful or impossible for any Bank (i) to make or fund the
relevant Fixed Rate Revolving Credit Borrowing or (ii) to continue such
Fixed Rate Revolving Credit Borrowing as a Fixed Rate Revolving Credit
Borrowing of the then existing type or (iii) to convert a Loan to such a
Fixed Rate Revolving Credit Loan, and such Bank has provided to the Agent
and the Borrowers a certificate prepared in good faith to that effect, then
the Borrowers shall not be entitled, so long as such circumstances
continue, to request a Fixed Rate Revolving Credit Borrowing of the
affected type pursuant to Section 2.6 or a continuation of or conversion to
a Fixed Rate Revolving Credit Borrowing of the affected type pursuant to
Section 2.9. In the event that such circumstances no longer exist, the
Banks shall again honor requests, subject to this Agreement, for Fixed Rate
Revolving Credit Borrowings of the affected type pursuant to Section 2.6,
and requests for continuations of and conversions to Fixed Rate Revolving
Credit Borrowings of the affected type pursuant to Section 2.9. Limitations
on request for Alternate Currency Loans shall be as set forth in the
applicable Alternate Currency Addendum.
2.11 Minimum Amounts; Limitation on Number of Borrowings. Except for
(a) Borrowings and conversions thereof which exhaust the entire remaining
amount of the Revolving Credit Commitments, and (b) conversions or payments
required pursuant to Section 3.1(d) or Section 3.7, each Revolving Credit
Loan and each continuation or conversion pursuant to Section 2.9 and each
prepayment thereof shall be in a minimum amount of $1,000,000 and in
integral multiples of $500,000 (or, if the Loan or payment is to be
denominated in any Foreign Syndicated Currency, such comparable and
convenient amount as the Agent may from time to time specify) and each
Letter of Credit shall be in a minimum amount of $250,000 with respect to
any Letter of Credit. Notwithstanding anything herein to the contrary, the
Borrowers shall not be permitted to request (a) that any Revolving Credit
Loan be denominated in any currency other than a Syndicated Currency, (b)
that any Revolving Credit Loan other than a Eurocurrency Rate Loan be
denominated in a currency other than Dollars, or (c) that any Alternate
Currency Loan be denominated in any currency other than as specified in the
applicable Alternate Currency Addendum.
2.12 Treasury Manager. Each Borrower authorizes the Treasury Manager
to act as its manager in making requests and in carrying out as its manager
and on its behalf all other functions conferred on the Treasury Manager
under this Agreement and all other ancillary functions. Each Borrower
further agrees that the Treasury Manager may nominate any Borrower as the
Designated Borrower, and agrees that the Advances allocated to it, and all
31
other acts carried out by the Treasury Manager falling within its
authority, shall be conclusive and binding on it and all parties. Neither
any Bank nor the Agent is or shall be deemed to be concerted as to the
Treasury Manager's compliance with instructions from any Borrower. The
content of each request and every other notice delivered by the Treasury
Manager shall be irrevocable, and the Agent and the Banks shall be entitled
to rely fully on their content.
2.13 Applicable Lending Installation. Each Bank and the Agent may make
and book its Loans and, in the case of the Agent, issue Letters of Credit,
at any Applicable Lending Installation(s) selected by such Bank or the
Agent, as the case may be, and each Bank and the Agent may change its
Applicable Lending Installation(s) from time to time. Each Bank may, by
written notice to the Agent and the applicable Borrower, designate one or
more Applicable Lending Installations which are to make and book Loans and
for whose account Loan payments are to be made. The Agent may, by written
notice to the applicable Borrower, designate one or more Applicable Lending
Installations which are to issue and book Letters of Credit and for whose
accounts Loan payments and Letter of Credit reimbursements are to be made
and through which its functions are to be performed. All terms of this
Agreement shall apply to any such Applicable Lending Installation(s). Each
Bank agrees to designate a different Applicable Lending Installation if
such designation would avoid the need for, or reduce the amount of any
compensation, which may be required to be paid by any Borrower pursuant to
Section 3.4 or 3.6, provided that such designation would not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank in any
material manner.
ARTICLE III
PAYMENTS AND PREPAYMENTS
3.1 Principal Payments.
(a) Unless earlier payment is required under this Agreement, the
Borrowers shall pay to the Banks on the Termination Date the entire
outstanding principal amount of the Revolving Credit Loans.
(b) Unless earlier payment is required under this Agreement, the
Borrowers shall, on the maturity date of any Bid-Option Loan, pay to the
Bank of such Bid-Option Loan the outstanding principal amount of such Loan.
(c) Unless earlier payment is required under this Agreement or under
any Alternate Currency Addendum, the Borrowers shall pay to the applicable
Alternate Currency Banks on the Termination Date, the entire outstanding
principal amount of the Alternate Currency Loans.
(d) The Borrowers may at any time and from time to time prepay all or
a portion of the Loans without premium or penalty, provided that (i) a
Borrower may not prepay any portion of any Loan as to which an election for
continuation of or conversion to a Fixed Rate Revolving Credit Loan is
pending pursuant to Section 2.9, (ii) unless earlier payment is required
under this Agreement or unless Borrower pays all amounts required pursuant
to Section 3.8, any Fixed Rate Revolving Credit Loan or Bid-Option Loan may
only be prepaid on the last day of the then current Interest Period with
respect to such Loan, (iii) any prepayment of any Alternate Currency Loan
shall be subject to the provisions of the applicable Alternate Currency
Addendum, and (iv) such prepayment shall only be permitted if the Treasury
Manager shall have given notice thereof on the Business Day of such
prepayment with respect to prepayment of Floating Rate Loans and not later
than 10:00 a.m. local time three (3) Eurocurrency Business Days notice
thereof with respect to prepayment of Eurocurrency Rate Loans, such notice
specifying the Loan or portion thereof to be so prepaid and shall have paid
to the Banks, together with such prepayment of principal, all accrued
32
interest to the date of payment on such Loan or portion thereof so prepaid
and all amounts owing to the Banks under Section 3.8 in connection with
such prepayment. Upon the giving of such notice, the aggregate principal
amount of such Loan or portion thereof so specified in such notice,
together with such accrued interest and other amounts, shall become due and
payable on the specified date.
(e) In addition to all other payments required hereunder, as of the
last Business Day of each month and as of the date each Advance is made or
continued or converted hereunder, if the Dollar Equivalent of all Advances
exceeds the aggregate amount of the Commitments, the Borrowers shall prepay
the Advances, in such order as determined by the Borrowers, in an amount
such that the Dollar Equivalent of all Advances does not exceed the
aggregate amount of the Commitments as of such date, together with all
amounts owing to the applicable Banks under Section 3.8 or the applicable
Alternate Currency Addendum in connection therewith, if any.
(f) In addition to all other payments required hereunder, as of the
last Business Day of each month and as of the date each Advance is made or
continued or converted hereunder, if the Dollar Equivalent of all Advances
in Alternate Currencies exceeds the least of (i) $100,000,000, (ii) the
aggregate amount of the Alternate Currency Commitments or (iii) the
aggregate amount that would be permitted by the proviso to Section 2.1(a),
the Borrowers shall prepay the Advances in such order as determined by the
Borrowers, in an amount such that the Dollar Equivalent of all Advances in
Alternate Currencies does not exceed such amount as of such date, together
with all amounts owing to the applicable Banks under Section 3.8 or the
applicable Alternate Currency Addendum in connection therewith, if any.
(g) In addition to all other payments required hereunder, as of the
last Business Day of each month and as of the date each Advance under any
Alternate Currency Addendum is made or continued or converted hereunder, if
the Dollar Equivalent of all Advances pursuant to such Alternate Currency
Addendum exceeds the aggregate Alternate Currency Commitments pursuant to
such Alternate Currency Addendum, the Borrowers shall prepay such Alternate
Currency Advances, in such order as determined by Borrowers, in an amount
such that the Dollar Equivalent of such Alternate Currency Advances does
not exceed the amount specified in the applicable Alternate Currency
Addendum as of such date, together with all amounts owing to the applicable
Banks under Section 3.8 or the applicable Alternate Currency Addendum in
connection therewith, if any.
(h) Notwithstanding anything in this Agreement or any Loan Document to
the contrary, none of the Borrowing Subsidiaries shall be liable for any of
the Bank Obligations of any other borrower. A Borrowing Subsidiary shall be
liable only for Advances and related interest and fees requested by such
Borrowing Subsidiary and directly advanced to, or issued for the direct
benefit of, such Borrowing Subsidiary.
3.2 Interest Payments. The Borrowers shall pay interest to the Banks
on the unpaid principal amount of each Loan (other than Bid-Option Loans,
for which the interest shall be payable directly to the Bank of such
Bid-Option Loan as described in clause (b) below), for the period
commencing on the date such Loan is made until such Loan is paid in full,
on each Interest Payment Date and at maturity (whether at stated maturity,
by acceleration or otherwise), and thereafter on demand, at the following
rates per annum:
(a) With respect to Revolving Credit Loans:
(i) During such periods that such Loan is a Floating Rate Loan,
the Floating Rate.
33
(ii) During such periods that such Loan is a Eurocurrency Rate
Loan, the Eurocurrency Rate applicable to such Loan for each related
Eurocurrency Interest Period.
(b) With respect to Alternate Currency Loans, the interest rate for
such Alternate Currency Loans specified in the applicable Alternate
Currency Addendum.
(c) With respect to Bid-Option Loans, the Bid-Option Rate quoted for
such Loan by the Bank making such Loan.
(d) With respect to Swing Loans, the interest rate for such Swing Loan
specified in Section 2.3.
Notwithstanding the foregoing paragraphs (a) through (d), the Borrowers
shall pay interest on demand at the Overdue Rate on the outstanding
principal amount of any Loan and any other amount payable by the Borrowers
hereunder (other than interest) on and after an Event of Default.
3.3 Payment Method.
(a) All payments to be made by the Borrowers hereunder will be made to
the Agent for the account of the Banks (i) in the case of principal and
interest on any Loan, in the Permitted Currency in which such Loan is
denominated and (ii) in all other cases, in the otherwise specified or
relevant currency, and in all cases in immediately available, freely
transferable, cleared funds, in the case of any payment to be made in
Dollars, not later than 2:00 p.m. at the place for payment on the date on
which such payment shall be come due and, in all other cases, on the date
on which such payment shall become due, (x) in the case of principal and
interest on any Loan denominated in a Permitted Currency other than
Dollars, by credit to the account of the Agent at its designated branch or
correspondent bank in the country issuing the relevant Permitted Currency
or in such other place specified by the Agent with respect to such Loan
pursuant to Section 2.6(b), and (y) in all other cases to the Agent at the
address of its principal office specified in Section 8.2. Payments to be
made in Dollars received after 2:00 p.m. at the place for payment shall be
deemed to be payments made prior to 2:00 p.m. at the place for payment on
the next succeeding Business Day. Each Borrower hereby authorizes the Agent
to charge its account with the Agent in order to cause timely payment of
amounts due hereunder to be made (subject to sufficient funds being
available in such account for that purpose).
(b) At the time of making each such payment, a Borrower shall, subject
to the other terms and conditions of this Agreement, specify to the Agent
that Borrowing or other obligation of the Borrowers hereunder to which such
payment is to be applied. In the event that a Borrower fails to so specify
the relevant obligation or if an Event of Default shall have occurred and
be continuing, the Agent may apply such payments as it may determine in its
sole discretion to obligations of the Borrowers to the Banks arising under
this Agreement.
(c) On the day such payments are deemed received, the Agent shall
promptly remit to the Banks their pro rata shares of such payments in
immediately available funds, (i) in the case of payments of principal and
interest on any Borrowing denominated in a Permitted Currency other than
Dollars, at an account maintained and designated by each Bank at a bank in
the principal financial center of the country issuing the Permitted
Currency in which such Borrowing is denominated or in such other place
specified by the Agent and agreed to by the Banks and (ii) in all other
cases, to the Banks at their respective address in the United States
specified for notices pursuant to Section 8.2. Such pro rata shares shall
be determined with respect to each such Bank, (i) in the case of payments
of principal and interest on any Borrowing, by the ratio which the
outstanding principal balance of its Loan included in such Borrowing bears
34
to the outstanding principal balance of the Loans of all of the Banks
included in such Borrowing and (ii) in the case of fees paid pursuant to
Section 2.5 and other amounts payable hereunder (other than the Agent's
fees payable pursuant to Section 2.5(c) and amounts payable to any Bank
under Section 2.6 or 3.6) by the ratio which the Commitment of such Bank
bears to the Commitments of all the Banks.
(d) This Agreement arises in the context of an international
transaction, and the specification of payment in a specific currency at a
specific place pursuant to this Agreement is of the essence. Such specified
currency shall be the currency of account and payment under this Agreement.
The obligations of the Borrowers hereunder shall not be discharged by an
amount paid in any other currency or at another place, whether pursuant to
a judgment or otherwise, to the extent that the amount so paid, on prompt
conversion into the applicable currency and transfer to the Banks under
normal banking procedure, does not yield the amount of such currency due
under this Agreement. In the event that any payment, whether pursuant to a
judgment or otherwise, upon conversion and transfer, does not result in
payment of the amount of such currency due under this Agreement, the Banks
shall have an independent cause of action against the Borrowers for the
currency deficit.
(e) If for purposes of obtaining judgment in any court it becomes
necessary to convert any currency due hereunder into any other currency,
the Borrowers will pay such additional amount, if any, as may be necessary
to ensure that the amount paid in respect of such judgment is the amount in
such other currency which, when converted at the Agent's spot rate of
exchange prevailing on the date of payment, would yield the same amount of
the currency due hereunder. Any amount due from the Borrowers under this
Section 3.3(e) will be due as a separate debt and shall not be affected by
judgment being obtained for any other sum due under or in respect of this
Agreement.
3.4 No Setoff or Deduction.
(a) All such payments shall be made free and clear of any present or
future taxes or withholdings and without any set-off or counter claim or
any restriction or condition or deduction whatsoever. The Designated
Borrower shall indemnify the Agent and each Bank against any taxes or
charges (other than taxes imposed on net overall income of the Bank or the
Agent, by the jurisdiction, or by any political subdivision or taxing
authority of any such jurisdiction, in which any Bank or the Agent, as the
case may be, has its principal office) which may be claimed from it in
respect of the Advances or any of them or any sum payable by the Borrowers
or any of them hereunder and against any costs, charges and expenses or
liabilities in respect of such claim and such indemnity shall survive the
termination of the Commitments.
(b) If at any time any Borrower is required by law or by any directive
or order of any court of competent jurisdiction to make any deduction or
withholding of whatsoever nature from any payment due under this Agreement
or any of the Loan Documents, such Borrower will ensure that the same does
not exceed the minimum liability therefor and will (a) pay to any Bank on
request such additional amount as such Bank certifies will result in the
net amount received by it after all deductions being equal to the full
amount which would have been receivable had there been no deduction or
withholding and (b) pay forthwith to the relevant authorities the full
amount of the deduction or withholding and deliver to the Agent such an
official receipt, certificate or other proof evidencing the amount paid in
respect of such deduction or withholding. Any additional amount paid under
this sub-clause shall not be treated as interest but as agreed
compensation.
(c) If any payment by any Borrower is made to or for the account of
any Bank after deduction for or on account of tax, and additional payments
are made by the Designated Borrower then, if any Bank shall receive or be
35
granted a credit against or remission for such tax, such Bank shall, to the
extent that it can do so without prejudice to the retention of the amount
of such credit or remission, reimburse to the Designated Borrower such
amount as such Bank shall, in its absolute opinion, have concluded to be
attributable to the relevant tax or deduction or withholding; provided,
that such Designated Borrower, upon the request of such Bank, agrees to
repay the amount paid over to such Designated Borrower (plus any penalties,
interest or other charges imposed by the relevant governmental entity) to
such Bank in the event such Bank is required to repay any such credit,
refund or other amount to such governmental entity. Nothing herein
contained shall interfere with the right of any Bank to arrange its affairs
in whatever manner it thinks fit and, in particular, the Banks shall not be
under any obligation to claim relief from its corporation profits or
similar tax liability in respect of such tax in priority to any other
claims, reliefs, credits or deductions available to it nor oblige any Bank
to disclose any information relating to its tax affairs. Such reimbursement
shall be made as soon as reasonably practical upon such Bank certifying
that the amount of such credit or remission has been received by it.
3.5 Payment on Non-Business Day; Payment Computations. Except as
otherwise provided in this Agreement to the contrary, whenever any
installment of principal of, or interest on, any Loan or any other amount
due hereunder becomes due and payable on a day which is not a Business Day,
the maturity thereof shall be extended to the next succeeding Business Day
and, in the case of any installment of principal, interest shall be payable
thereon at the rate per annum determined in accordance with this Agreement
during such extension. Except as otherwise provided in this Agreement to
the contrary, computations of interest and other amounts due under this
Agreement shall be made on the basis of a year of 360 days, 365 or 366
days, as determined by the Agent to be the custom and practice in the
relevant market, for the actual number of days elapsed, including the first
day but excluding the last day of the relevant period.
3.6 Additional Costs.
(a) In the event that any applicable law, treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect and whether or not
presently applicable to any Bank or the Agent, or any interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by any Bank or the
Agent with any directive of any such authority (whether or not having the
force of law), shall (i) affect the basis of taxation of payments to any
Bank or the Agent of any amounts payable by any Borrower under this
Agreement (other than taxes imposed on the overall net income of the Bank
or the Agent, by the jurisdiction, or by any political subdivision or
taxing authority of any such jurisdiction, in which any Bank or the Agent,
as the case may be, has its principal office), or (ii) shall impose, modify
or deem applicable any reserve, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended
by any Bank or the Agent, as the case may be, or (iii) shall impose any
other condition with respect to this Agreement, the Commitments or the
Advances, and the result of any of the foregoing is to increase the cost to
any Bank or the Agent, as the case may be, of making, funding or
maintaining any Fixed Rate Loan or to reduce the amount of any sum
receivable by any Bank or the Agent, thereon, then the Borrowers shall pay
to such Bank or the Agent, as the case may be, from time to time, upon
request by such Bank (with a copy of such request to be provided to the
Agent) or the Agent, additional amounts sufficient to compensate such Bank
or the Agent, as the case may be, for such increased cost or reduced sum
receivable to the extent, in the case of any Fixed Rate Loan, such Bank or
the Agent, as the case may be, is not compensated therefor in the
computation of the interest rate applicable to such Fixed Rate Loan. Each
Bank or the Agent, as the case may be, seeking compensation hereunder shall
deliver to the Borrowers a statement setting forth (i) such increased cost
or reduced sum receivable as such Bank or the Agent, as the case may be,
has calculated in good faith, (ii) a description of the event giving rise
thereto, (iii) a calculation in reasonable detail of the amounts requested
and (iv) a statement that such Bank or the Agent, as the case may be, has
36
not allocated to its Commitment, Borrowings or outstanding Loans a
proportionately greater amount than is attributable to each of its other
credit extensions that are affected similarly by compliance by such Bank or
the Agent, as the case may be, whether or not such Bank or the Agent, as
the case may be, allocates any portion of such amount to such other
commitments or credit extensions. Such statement as to the amount of such
increased cost or reduced sum receivable, prepared in good faith and in
reasonable detail by such Bank or the Agent, as the case may be, and
submitted by such Bank or the Agent, as the case may be, to the Borrowers,
shall be conclusive and binding for all purposes absent manifest error in
computation.
(b) In the event that any applicable law, treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect and whether or not
presently applicable to any Bank or the Agent, but applicable to banks or
financial institutions generally, or any interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof, or compliance by any Bank or the Agent with any
directive of any such authority (whether or not having the force of law),
including any risk-based capital guidelines, affects the amount of capital
required or expected to be maintained by such Bank or the Agent (or any
corporation controlling such Bank or the Agent) and such Bank or the Agent,
as the case may be, determines that the amount of such capital is increased
by or based upon the existence of such Bank's or the Agent's obligations
hereunder and such increase has the effect of reducing the rate of return
on such Bank's or the Agent's (or such controlling corporation's) capital
as a consequence of such obligations hereunder to a level below that which
such Bank or the Agent (or such controlling corporation) could have
achieved but for such circumstances (taking into consideration its policies
with respect to capital adequacy) by an amount deemed by such Bank or the
Agent to be material, then the Borrowers shall pay to such Bank or the
Agent, as the case may be, from time to time, upon request by such Bank
(with a copy of such request to be provided to the Agent) or the Agent,
additional amounts sufficient to compensate such Bank or the Agent (or such
controlling corporation) for any reduced rate of return which such Bank or
the Agent reasonably determines to be allocable to the existence of such
Bank's or the Agent's obligations hereunder. Each Bank or the Agent, as the
case may be, seeking compensation hereunder shall deliver to the Borrowers
a statement setting forth (i) such increased cost or reduced sum receivable
as such Bank or the Agent, as the case may be, has calculated in good
faith, (ii) a description of the event giving rise thereto, (iii) a
calculation in reasonable detail of the amounts requested and (iv) a
statement that such Bank or the Agent, as the case may be, has not
allocated to its Commitment, Borrowings or outstanding Loans a
proportionately greater amount than is attributable to each of its other
credit extensions that are affected similarly by compliance by such Bank or
the Agent, as the case may be, whether or not such Bank or the Agent, as
the case may be, allocates any portion of such amount to such other
commitments or credit extensions. Such statement as to the amount of such
compensation, prepared in good faith and in reasonable detail by such Bank
or the Agent, as the case may be, and submitted by such Bank or the Agent
to the Borrowers, shall be conclusive and binding for all purposes absent
manifest error in computation.
(c) The Borrowers shall have no obligation to compensate any Bank with
respect to amounts provided in this Section 3.6 with respect to any period
prior to the date which is 90 days prior to the date such Bank delivers its
written statement hereunder requesting compensation.
3.7 Illegality and Impossibility. In the event that any applicable
law, treaty, rule or regulation (whether domestic or foreign) now or
hereafter in effect and whether or not presently applicable to any Bank, or
any interpretation or administration thereof by any governmental authority
charged with the interpretation or administration thereof, or compliance by
any Bank with any directive of such authority (whether or not having the
force of law), including without limitation exchange controls, shall make
it unlawful or impossible for any Bank to maintain any Fixed Rate Loan
under this Agreement or shall make it impracticable, unlawful or impossible
for, or shall in any way limit or impair the ability of, any Borrower to
37
make or any Bank to receive any payment under this Agreement at the place
specified for payment hereunder, or to freely convert any amount paid into
Dollars at market rates of exchange or to transfer any amount paid or so
converted to the address of its principal office specified in Section 8.2,
the Borrowers shall upon receipt of notice thereof from such Bank, repay in
full the then outstanding principal amount of each Fixed Rate Loan so
affected, together with all accrued interest thereon to the date of payment
and all amounts owing to such Bank under Section 3.8, (a) on the last day
of the then current Interest Period applicable to such Loan if such Bank
may lawfully continue to maintain such Loan to such day, or (b) immediately
if such Bank may not continue to maintain such Loan to such day.
3.8 Indemnification. If any Borrower makes any payment of principal
with respect to any Loan on any other date than the last day of an Interest
Period applicable thereto, (whether pursuant to Section 3.7 or Section 6.2
or otherwise), or if any Borrower fails to borrow, continue or convert any
Loan after notice has been given to the Banks in accordance with Section
2.6 or Section 2.9, on the date or in the amount specified in such notice,
then the Borrowers shall reimburse each Bank on demand for any resulting
net loss or expense incurred by each such Bank after giving credit for any
earnings or other quantifiable financial benefit to such Bank from such
Bank's investment or other amounts prepaid or not reborrowed, including
without limitation any loss incurred in obtaining, liquidating or employing
deposits from third parties, whether or not such Bank shall have funded or
committed to fund such Loan. A statement as to the amount of such loss or
expense, prepared in good faith and in reasonable detail by such Bank and
submitted by such Bank to the Borrowers, shall be conclusive and binding
for all purposes absent manifest error in computation, provided that before
delivery of such statement, each Bank shall use reasonable efforts in
accordance with its normal practices and procedures to reduce amounts
payable under this Section. Calculation of all amounts payable to such Bank
under this Section 3.8 shall be made as though such Bank shall have
actually funded or committed to fund the relevant Loan through the purchase
of an underlying deposit in an amount equal to the amount of such Loan and
having a maturity comparable to the related Interest Period; provided,
however, that such Bank may fund any Loan in any manner it sees fit and the
foregoing assumption shall be utilized only for the purpose of calculation
of amounts payable under this Section 3.8.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants to the Agent and the Banks that:
4.1 Corporate Existence and Power. Each Borrower is a Person duly
organized, validly existing and in good standing under the laws of the
state or other political subdivision of its jurisdiction of incorporation
or organization, as the case may be, and is duly qualified to do business,
and is in good standing, in all additional jurisdictions where such
qualification is necessary under applicable law, except where the failure
to be so qualified would not have a Material Adverse Effect. Each Borrower
has all requisite corporate power to own or lease the properties used in
its business and to carry on its business as now being conducted and as
proposed to be conducted, and to execute and deliver the Loan Documents to
which it is a party and to engage in the transactions contemplated by the
Loan Documents.
4.2 Corporate Authority. The execution, delivery and performance by
each Borrower of the Loan Documents to which it is a party have been duly
authorized by all necessary corporate action and are not in contravention
of any material law, rule or regulation, or any judgment, decree, writ,
injunction, order or award of any arbitrator, court or governmental
authority, or of the terms of such Borrower's charter or by-laws, or of any
38
material contract or undertaking to which the Borrower is a party or by
which the Borrower or its property is bound or affected and do not result
in the imposition of any Lien except for Permitted Liens.
4.3 Binding Effect. The Loan Documents when delivered hereunder will
be, legal, valid and binding obligations of each Borrower party thereto
enforceable against each Borrower in accordance with their respective
terms; except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to
creditors' rights and except that the remedy of specific performance and
injunctive and other forms of equitable relief are subject to equitable
defenses and to the discretion of the court before which any proceedings
may be brought.
4.4 Subsidiaries. Schedule 4.4 hereto (as updated from time to time
pursuant to Section 5.1(g) hereof) correctly sets forth the corporate name,
jurisdiction of incorporation and ownership of each Subsidiary of the
Company. Each Significant Subsidiary and each corporation becoming a
Significant Subsidiary of the Company after the date hereof is and will be
a corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation and is and will be duly
qualified to do business in each additional jurisdiction where such
qualification is or may be necessary under applicable law, except where the
failure to be so qualified would not have a Material Adverse Effect.
4.5 Litigation. Except as set forth in Schedule 4.5 hereto, there is
no action, suit or proceeding pending or, to the best of each Borrower's
knowledge, threatened against or affecting any Borrower or any of their
respective Subsidiaries before or by any court, governmental authority or
arbitrator, which is likely to have, either individually or collectively, a
Material Adverse Effect, and to the best of the Company's knowledge, there
is no basis for any such action, suit or proceeding.
4.6 Financial Condition. The consolidated balance sheet of the Company
and its Subsidiaries and the consolidated statements of income and cash
flow of the Company and its Subsidiaries for the fiscal year ended December
31, 2003 and reported on by Ernst & Young LLP, independent certified public
accountants, and the interim consolidated statements of income, retained
earnings and cash flow of the Company and its Subsidiaries as of or for the
nine-month period ended September 30, 2004, copies of which have been
furnished to the Banks, fairly present, and the subsequent financial
statements of the Company and its Subsidiaries delivered pursuant to
Section 5.1(d) will fairly present the consolidated financial position of
the Company and its Subsidiaries as at the respective dates thereof, and
the consolidated results of operations of the Company and its Subsidiaries
for the respective periods indicated, all in accordance with GAAP
consistently applied (subject, in the case of said interim statements, to
normal year-end adjustments and footnotes). There has been no material
adverse change in the financial condition of the Company and its
Subsidiaries taken as a whole since December 31, 2003 or, after the
Effective Date, since the date as of which the most recent audited
financial statements were prepared. There is no material known Contingent
Liability of the Company that is not reflected in such financial statements
or in the notes thereto.
4.7 Use of Loans. Each Borrower will use the proceeds of the Loans for
its general corporate purposes, including repayment of certain Indebtedness
under the 2001 Credit Agreement and the Bridge Credit Agreement and
Acquisitions negotiated between the Company and prospective sellers.
4.8 Consents, Etc. Except for such consents, approvals,
authorizations, declarations, registrations or filings delivered by the
Company pursuant to Section 2.7(g), if any, each of which is in full force
and effect, no consent, approval or authorization of or declaration,
registration or filing with any governmental authority or any
nongovernmental person, including without limitation any creditor, lessor
39
or stockholder of any Borrower, is required on the part of any Borrower in
connection with the execution, delivery and performance of the Loan
Documents or the transactions contemplated hereby or as a condition to the
legality, validity or enforceability of the Loan Documents, except where
the failure to obtain such consents, approvals, authorizations,
declarations, registrations or filings would not have a Material Adverse
Effect.
4.9 Taxes. The Company has filed all material tax returns (federal,
state and local) required to be filed and have paid all taxes shown thereon
to be due, including interest and penalties, or have established adequate
financial reserves on their respective books and records for payment
thereof, except where the failure to file such returns, pay such taxes or
establish such reserves would not have a Material Adverse Effect.
4.10 Title to Properties. Except as otherwise disclosed in the latest
balance sheet delivered pursuant to this Agreement, the Company or one or
more of its Subsidiaries have good and marketable fee simple title to all
of the real property to the best of the Company's knowledge absent manifest
error, and a valid and indefeasible ownership interest in all of the other
properties and assets reflected in said balance sheet or subsequently
acquired by the Company or any such Subsidiary material to the business or
financial condition of the Company and its Subsidiaries taken as a whole,
except for title defects that do not have a Material Adverse Effect. All of
such properties and assets are free and clear of any Lien, except for
Permitted Liens.
4.11 ERISA. The Borrowers, their respective Significant Subsidiaries,
their ERISA Affiliates and their respective Plans are in substantial
compliance in all material respects with those provisions of ERISA and of
the Code which are applicable with respect to any Plan. No Prohibited
Transaction and no Reportable Event has occurred with respect to any such
Plan which would cause an Event of Default. No Borrower, any of their
respective Significant Subsidiaries nor any of their ERISA Affiliates is an
employer with respect to any Multiemployer Plan. Except where such would
not have a Material Adverse Effect, the Borrowers, their respective
Significant Subsidiaries and their ERISA Affiliates have met the minimum
funding requirements under ERISA and the Code with respect to each of their
respective Plans, if any, and have not incurred any liability to the PBGC,
other than premiums which are not yet due and payable. The execution,
delivery and performance of the Loan Documents does not constitute a
Prohibited Transaction. Except where such would not have a Material Adverse
Effect, there is no material unfunded benefit liability, determined in
accordance with Section 4001(a)(18) of ERISA, with respect to any Plan of
any Borrower, their respective Significant Subsidiaries or their ERISA
Affiliates.
4.12 Environmental and Safety Matters. Except as disclosed on Schedule
4.12, to the best of each Borrower's knowledge, each Borrower and each
Subsidiary of each Borrower is in substantial compliance with all material
federal, state and local laws, ordinances and regulations relating to
safety and industrial hygiene or to the environmental condition, including
without limitation all material Environmental Laws in jurisdictions in
which any Borrower or any such Subsidiary owns or operates, or has owned or
operated, a facility or site, or arranges or has arranged for disposal or
treatment of hazardous substances, solid waste, or other wastes, accepts or
has accepted for transport any hazardous substances, solid wastes or other
wastes or holds or has held any interest in real property or otherwise,
except where such would not have a Material Adverse Effect, as of the date
thereof, except as disclosed on Schedule 4.12, no written demand, claim,
notice, suit, suit in equity, action, administrative action, investigation
or inquiry whether brought by any governmental authority, private person or
otherwise, arising under, relating to or in connection with any
Environmental Laws is pending or, to the best of each Borrower's knowledge,
threatened against any Borrower or any such Subsidiary, any real property
in which any Borrower or any such Subsidiary holds or has held an interest
or any past or present operation of any Borrower or any such Subsidiary
which is likely to have a Material Adverse Effect. Except where such would
40
not have a Material Adverse Effect, neither any Borrower nor any Subsidiary
of any Borrower (a) is the subject of any federal or state investigation
evaluating whether any remedial action is needed to respond to a release of
any toxic substances, radioactive materials, hazardous wastes or related
materials into the environment, or (b) has received any notice of any toxic
substances, radioactive materials, hazardous waste or related materials in,
or upon any of its properties in violation of any Environmental Laws, As to
such matters disclosed on Schedule 4.12, to the best of each Borrower's
knowledge, none will have a Material Adverse Effect. Except as set forth on
Schedule 4.12, to the best of each Borrower's knowledge, no release,
threatened release or disposal of hazardous waste, solid waste or other
wastes is occurring or has occurred on, under or to any real property in
which any Borrower or any of their respective Subsidiaries holds any
interest or performs any of its operations, in material violation of any
Environmental Law, except where such would not have a Material Adverse
Effect.
4.13 No Material Adverse Change. Neither the Company nor any of its
Subsidiaries has received any notice, citation or communication of the
nature referred to in Section 5.1(d)(i), except in respect of such matters
as have been or are being remediated in all material respects or are being
contested or remediated in good faith, and, in the case of any such matter
being so contested or remediated, and as of the date of this Agreement,
adequate provision for all material costs of any remediation is reflected
in the financial statements referred to in Section 4.6 of this Agreement,
and in respect of any such notice, citation or communication received after
the date of this Agreement, will be reflected in the subsequent financial
statements furnished to the Agent and the Banks pursuant to Sections
5.1(d)(ii) and 5.1(d)(iii).
4.14 No Default. No Default or Event of Default has occurred and is
continuing.
4.15 Compliance with Laws. The Company and its Subsidiaries have
complied in all material respects with all applicable laws, rules,
regulations and orders of any governmental authority, whether federal,
state, local or foreign (including without limitation ERISA, the Code and
Environmental Laws), in effect except where failure to comply would not
have a Material Adverse Effect.
ARTICLE V
COVENANTS
5.1 Affirmative Covenants. Each Borrower covenants and agrees that,
until the Termination Date and thereafter until irrevocable payment in full
of the principal of and accrued interest on the Loans, expiration or
termination of all Letters of Credit, reimbursement of any payments under
Letters of Credit and the performance of all other obligations of the
Borrowers under this Agreement, unless the Required Banks shall otherwise
consent in writing, it shall, and shall cause each of its Subsidiaries to:
(a) Preservation of Corporate Existence, Etc. Do or cause to be done
all things necessary to preserve, renew and keep in full force and effect
its legal existence, except to the extent permitted by Section 5.2(h), and
its qualification as a foreign corporation in good standing in each
jurisdiction in which such qualification is necessary under applicable law,
other than where failure to so qualify will not have a Material Adverse
Effect.
(b) Compliance with Laws, Etc. Comply in all material respects with
all applicable laws, rules, regulations and orders of any governmental
authority, whether federal, state, local or foreign (including without
limitation ERISA, the Code and Environmental Laws), in effect from time to
time; and pay and discharge promptly when due all taxes, assessments and
governmental charges or levies imposed upon it or upon its income, revenues
41
or property, before the same shall become delinquent or in default, as well
as all lawful claims for labor, materials and supplies or otherwise, which,
if unpaid, might give rise to Liens upon such properties or any portion
thereof, except to the extent that payment of any of the foregoing is then
being contested in good faith by appropriate legal proceedings, and except
where failure to comply would not have a Material Adverse Effect.
(c) Maintenance of Properties; Insurance. Maintain, preserve and
protect all property that is material to the conduct of the business of any
Borrower or any of their respective Subsidiaries and keep such property in
good repair, working order and condition and from time to time make, or
cause to be made all needful and proper repairs, renewals, additions,
improvements and replacements thereto necessary in order that the business
carried on in connection therewith may be properly conducted at all times
in accordance with customary and prudent business practices for similar
businesses; and, maintain in full force and effect insurance with
responsible and reputable insurance companies or associations in such
amounts, on such terms and covering such risks, as is usually carried by
companies engaged in similar businesses and owning similar properties
similarly situated and maintain in full force and effect public liability
insurance, insurance against claims for personal injury or death or
property damage occurring in connection with any of its activities or any
properties owned, occupied or controlled by it, in such amount as it shall
reasonably deem necessary.
(d) Reporting Requirements. Furnish to the Banks and the Agent the
following:
(i) Promptly and in any event within five calendar days after the
chief financial officer or any other senior officer becoming aware of
the occurrence of (A) any Event of Default or Default, or (B) the
commencement of any material litigation against, by or affecting any
Borrower or any of their respective Subsidiaries which the Company
would be required to report to the Securities and Exchange Commission,
a statement of the chief financial officer of the Company setting
forth details of such Event of Default or Default or such litigation
and the action which such Borrower or such Subsidiary, as the case may
be, has taken and proposes to take with respect thereto;
(ii) As soon as available and in any event within the earlier of
(A) five (5) days after the time period specified by the SEC under the
Exchange Act for quarterly reporting or (B) within 50 days after the
end of each of the first three fiscal quarters of each fiscal year of
the Company, the consolidated balance sheet of the Company and its
Subsidiaries as of the end of such quarter, and the related
consolidated statements of income and cash flow for the period
commencing at the end of the previous fiscal year and ending with the
end of such quarter, setting forth in each case in comparative form
the corresponding figures for the corresponding date or period of the
preceding fiscal year, all in reasonable detail and duly certified
(subject to normal year-end adjustments) by the chief financial
officer of the Company as having been prepared in accordance with
GAAP, provided, however, that at any time the Company shall be subject
to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, delivery within the time period specified above of copies of the
quarterly balance sheets and statements on Form 10-Q of the Company
and its Subsidiaries for such quarterly period as filed with the SEC
shall be deemed to satisfy the requirements of this clause (ii);
(iii) As soon as available and in any event within the earlier of
(A) five (5) days after the time period specified by the SEC under the
Exchange Act for annual reporting or (B) within 90 days after the end
of each fiscal year of the Company, a copy of the consolidated balance
sheet of the Company and its Subsidiaries as of the end of such fiscal
year and the related consolidated statements of income and cash flow
of the Company and its Subsidiaries for such fiscal year, with a
customary audit report of nationally recognized independent certified
public accountants selected by the Company, without qualifications
unacceptable to the Required Banks, provided, however, that at any
time the Company shall be subject to the reporting requirements of
42
Section 13 or 15(d) of the Exchange Act, delivery within the time
period specified above of copies of the annual balance sheets and
statements on Form 10-K of the Company and its Subsidiaries for such
annual period as filed with the SEC shall be deemed to satisfy the
requirements of this clause (iii);
(iv) Concurrently with any delivery of financial statements under
clauses (ii) or (iii) above, a compliance certificate in substantially
the form of Exhibit J attached hereto signed by the chief financial
officer of the Company showing the calculations necessary to determine
compliance with this Agreement, stating that no Event of Default or
Default has occurred and is continuing and also including a statement
of the aggregate outstanding amount of recourse obligations under the
leasing or commercial purchase programs of the Company, ICC or any
other wholly owned Subsidiary as the last day of such fiscal quarter
for which such certificate is being delivered and a calculation of the
portfolio quality and/or non-performing assets under such program(s),
in detail reasonably satisfactory to the Agent;
(v) Promptly after the sending or filing thereof, copies of all
final reports, proxy statements and financial statements which the
Company sends to or files with any of their respective security
holders or any securities exchange or the Securities and Exchange
Commission or any successor agency thereof;
(vi) Within 10 calendar days after receiving or becoming aware
thereof (A) a copy of any notice of intent to terminate any Plan of
any Borrower, their respective Significant Subsidiaries or any ERISA
Affiliate filed with the PBGC, (B) a statement of the chief financial
officer of such Borrower setting forth the details of the occurrence
of any Reportable Event with respect to any such Plan, (C) a copy of
any notice that any Borrower, any of their respective Significant
Subsidiaries or any ERISA Affiliate may receive from the PBGC relating
to the intention of the PBGC to terminate any such Plan or to appoint
a trustee to administer any such Plan, or (D) a copy of any notice of
failure to make a required installment or other payment within the
meaning of Section 412(n) of the Code or Section 302(f) of ERISA with
respect to any such Plan; which, in any case, is likely to have a
Material Adverse Effect; and
(vii) Promptly, such other information respecting the business,
properties, operations or condition, financial or otherwise, of any
Borrower or any of their respective Subsidiaries as any Bank or the
Agent may from time to time reasonably request.
(e) Accounting; Access to Records, Books, Etc. Maintain a system of
accounting established and administered in accordance with sound business
practices to permit preparation of financial statements in accordance with
GAAP and to comply with the requirements of this Agreement and, on and
after an Event of Default, at any reasonable time and from time to time
with prior notice to the Company, permit any Bank or the Agent or any
agents or representatives thereof to examine and make copies of and
abstracts from the records and books of account of, and visit the
properties of, the Borrowers and their respective Subsidiaries, and to
discuss the affairs, finances and accounts of the Borrowers and their
respective Subsidiaries with their respective directors, officers,
employees and independent auditors, provided that representatives of the
Company selected by the Company are present during any such visit or
discussion, and by this provision the Company does hereby authorize such
persons to discuss such affairs, finances and accounts with any Bank or the
Agent subject to the above terms and conditions.
(f) Stamp Taxes. The Company will pay all stamp taxes and similar
taxes, if any, including interest and penalties, if any, payable in respect
of the Loans. The efficacy of this subsection shall survive the payment in
full of the Loans.
43
(g) Further Assurances. Will execute and deliver within 30 days after
request therefor by the Required Banks or the Agent, all further
instruments and documents and take all further action in order to give
effect to, and to aid in the exercise and enforcement of the rights and
remedies of the Banks and the Agent under, this Agreement and the other
Loan Documents. In addition, the Company may deliver to the Agent and the
Banks from time to time, but no less frequently than each anniversary of
the Effective Date, supplements to Schedule 4.4 listing any Subsidiary not
listed in Schedule 4.4 hereto.
5.2 Negative Covenants. Until the Termination Date and thereafter
until irrevocable payment in full of the principal of and accrued interest
on the Loans, expiration or termination of all Letters of Credit,
reimbursement of any payments under Letters of Credit, and the performance
of all other obligations of each Borrower under this Agreement, the Company
agrees that, unless the Required Banks shall otherwise consent in writing
it shall not:
(a) Interest Coverage Ratio. Permit or suffer the Interest Coverage
Ratio to be less than 3.0 to 1.0; calculated as of the end of each fiscal
quarter for the four most recently ended fiscal quarters.
(b) Net Worth. Permit or suffer Consolidated Net Worth of the Company
and its Subsidiaries at any time to be less than the sum of (i)
$525,000,000, plus (ii) 50% of Cumulative Consolidated Net Income of the
Company and its Subsidiaries, if any, for the three-month periods ending
September 30, 2004 and December 31, 2004, and for each fiscal year of the
Company ending December 31, 2005 and thereafter.
(c) Total Debt to Adjusted EBITDA. Permit or suffer the ratio,
determined as of the end of each of the Company's fiscal quarters for the
four most recently ended fiscal quarters, of Consolidated Total Debt of the
Company and its Subsidiaries to Consolidated Adjusted EBITDA of the Company
and its Subsidiaries for the four most recently ended fiscal quarters to
exceed 3.50 to 1.0.
(d) Liens. Create, incur or suffer to exist any Lien on any of the
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether now owned or hereafter acquired, of the Company or any
of its Subsidiaries (except Unrestricted Margin Stock), other than:
(i) Liens for taxes not delinquent or for taxes being contested
in good faith by appropriate proceedings and as to which adequate
financial reserves have been established on its books and records;
(ii) Liens (other than any Lien imposed by ERISA) created and
maintained in the ordinary course of business which are not material
in the aggregate, and which would not have a Material Adverse Effect
and which constitute (A) pledges or deposits under worker's
compensation laws, unemployment insurance laws or similar legislation,
(B) good faith deposits in connection with bids, tenders, contracts or
leases to which the Company or any of its Subsidiaries is a party for
a purpose other than borrowing money or obtaining credit, including
rent security deposits, (C) liens imposed by law, such as those of
carriers, warehousemen and mechanics, if payment of the obligation
secured thereby is not yet due, (D) Liens securing taxes, assessments
or other governmental charges or levies not yet subject to penalties
for nonpayment, and (E) pledges or deposits to secure public or
statutory obligations of the Company or any of its Subsidiaries, or
surety, customs or appeal bonds to which the Company or any of its
Subsidiaries is a party;
44
(iii) Liens affecting real property which constitute minor survey
exceptions or defects or irregularities in title, minor encumbrances,
easements or reservations of, or rights of others for, rights of way,
sewers, electric lines, telegraph and telephone lines and other
similar purposes, or zoning or other restrictions as to the use of
such real property, provided that all of the foregoing, in the
aggregate, do not at any time materially detract from the value of
said properties or materially impair their use in the operation of the
businesses of the Company and its Subsidiaries taken as a whole;
(iv) Liens existing on the date hereof upon the same terms as the
date hereof, but no extensions, renewals and replacements thereof
shall be permitted, with each existing Lien securing Indebtedness in
excess of $5,000,000 described in Schedule 5.2(d) hereto;
(v) Liens granted by any Subsidiary in favor of the Company or
any other Subsidiary;
(vi) The interest or title of a lessor under any lease otherwise
permitted under this Agreement with respect to the property subject to
such lease to the extent performance of the obligations of the Company
or its Subsidiary thereunder is not delinquent;
(vii) Liens existing on property at the time of its acquisition
(other than any such Lien created in contemplation of such
acquisition), provided that the Company promptly forwards a schedule
of such Liens to the Agent after any such acquisition;
(viii) Liens incurred in connection with any transfer of an
interest in accounts, notes receivable, leases and related assets
which Liens are required to consummate a Securitization Transaction;
and
(ix) Liens, other than Liens described in clauses (i) through
(viii) above, securing Indebtedness in an aggregate amount not to
exceed 10% of Consolidated Net Worth.
(e) Merger; Etc. Merge or consolidate with any other person or take
any other action having a similar effect (other than an Acquisition which
is governed by Section 5.2(n) hereof), provided, however, (i) a Subsidiary
of the Company may merge with the Company, provided that the Company shall
be the surviving corporation, (ii) a Subsidiary of the Company may merge or
consolidate with another Subsidiary of the Company and (iii) this Section
5.2(e) shall not prohibit any merger if the Company shall be the surviving
or continuing corporation and, immediately after such merger, no Default or
Event of Default shall exist or shall have occurred and be continuing.
(f) Disposition of Assets; Etc. Sell, lease, license, transfer, assign
or otherwise dispose of all or a substantial portion of its business,
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether in one or a series of transactions, other than
inventory sold in the ordinary course of business upon customary credit
terms and sales of scrap or obsolete material or equipment and Unrestricted
Margin Stock, provided, however, that this Section 5.2(f) shall not
prohibit:
(i) Any sale, conveyance or other transfer of an interest in
accounts, notes receivable, leases and related assets on a limited
recourse basis in connection with any Securitization Transaction; or
(ii) Any other such sale, lease, license, transfer, assignment or
other disposition if the aggregate book value (disregarding any
write-downs of such book value other than ordinary depreciation and
amortization) of all of the business, assets, rights, revenues and
45
property disposed of shall be less than or equal to: (x) in any fiscal
year of the Company, 15% of the aggregate book value of the
Consolidated Total Assets as of the end of the immediately preceding
fiscal year, and (y) cumulatively after the Effective Date, 25% of
such aggregate book value of the Consolidated Total Assets as of the
end of the most recent fiscal year ending prior to the Effective Date,
and if, in the case of each of the foregoing clauses (i) and (ii),
immediately after such transaction, no Default shall exist or shall
have occurred and be continuing.
(g) Nature of Business. Engage in any business if, as a result, the
general nature of the business, taken on a consolidated basis, which would
then be engaged in by the Company and its Subsidiaries would be
substantially changed from the general nature of the business engaged in by
the Company and its Subsidiaries on the date of this Agreement which is the
manufacture, sale or lease of home medical and extended care equipment and
related products.
(h) Limitations on Indebtedness of Subsidiaries.
(i) Other than Advances to Borrowing Subsidiaries hereunder and
other than any Indebtedness of any Subsidiary under any Securitization
Transaction or other leasing or commercial purchase programs, permit
the sum of the aggregate principal amount of all Total Debt of its
Subsidiaries (determined on a consolidated basis eliminating
inter-company items among the Company and its Subsidiaries) to exceed
in an aggregate amount 10% of Consolidated Net Worth.
(ii) Any corporation which becomes a Subsidiary after the date
hereof shall for all purposes of this Section 5.2(h) be deemed to have
created, assumed or incurred, at the time it becomes a Subsidiary, all
Consolidated Total Debt of such corporation existing immediately after
it becomes a Subsidiary.
(i) Investments. Make any Investments, other than:
(i) Investments by the Company and its Subsidiaries in and to
Subsidiaries, including any Investment in a corporation which, after
giving effect to such Investment, will become a Subsidiary and
including any Investment in any Securitization Entity;
(ii) Investments in commercial paper maturing in 270 days or less
from the date of issuance which, at the time of acquisition by the
Company or any Subsidiary, is accorded the highest rating by S&P or
▇▇▇▇▇'▇ (or another nationally recognized credit rating agency of
similar standing if neither of such corporations is then in the
business of rating commercial paper);
(iii) Investments in direct obligations of the United States of
America or any agency or instrumentality of the United States of
America, the payment or guarantee of which constitutes a full faith
and credit obligation of the United States of America, in either case,
maturing in twelve months or less from the date of acquisition
thereof;
(iv) Investments in certificates of deposit maturing within one
year from the date of issuance thereof, issued by (and banker's
acceptances endorsed by) a bank or trust company organized under the
laws of the United States or any state thereof, having capital,
surplus and undivided profits aggregating at least $100,000,000 and
whose long-term certificates of deposit are, at the time of
acquisition thereof by the Company or a Subsidiary, rated AA or better
by S&P or Aa or better by ▇▇▇▇▇'▇ (or an equivalent rating by another
nationally recognized credit rating agency of similar standing if
neither of such corporations is then in the business of rating
certificates of deposit);
46
(v) Investments in repurchase agreements maturing within one year
from the date of issuance thereof entered into with a bank or trust
company of the type described in clause (iv) above;
(vi) Investments in tax-exempt floating rate optional tender
bonds backed by a letter of credit issued by a bank or trust company
of the type described in clause (iv) above;
(vii) 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 the Company or any Subsidiary;
(viii) receivables arising from the sale of goods and services in
the ordinary course of business of the Company and its Subsidiaries;
(ix) Investments in money market preferred stock rated "A" or
better by S&P or "a" or better by ▇▇▇▇▇'▇ (or an equivalent rating by
another nationally recognized credit rating agency of similar standing
if neither of such corporations is then in the business of rating such
preferred stock);
(x) Investments existing on the Effective Date which are
described on Schedule 5.2(i); and
(xi) Other Investments which do not exceed in the aggregate an
amount equal to 10% of Consolidated Net Worth.
In valuing any Investments for the purpose of applying the limitations
set forth in this Section 5.2(i), such Investments shall be taken at the
original cost thereof, without allowance for any subsequent write-offs or
appreciation or depreciation therein, but less any amount repaid or
recovered on account of capital or principal.
For purposes of this Section 5.2(i), at any time when a corporation
becomes a Subsidiary, all Investments of such corporation at such time
shall be deemed to have been made by such corporation, as a Subsidiary, at
such time.
(j) Transactions with Affiliates. Will not, and will not permit any
Subsidiary to, enter into or be a party to any transaction or arrangement
with any Affiliate (including, without limitation, the purchase from, sale
to or exchange of property with, or the rendering of any service by or for,
any Affiliate), except (i) in the ordinary course of and pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and
upon fair and reasonable terms no less favorable to the Company or such
Subsidiary than would obtain in a comparable arm's-length transaction with
a Person other than an Affiliate and (ii) any transactions between the
Company or any Subsidiary and any other Subsidiary which are required to
consummate a Securitization Transaction.
(k) Additional Covenants. If at any time the Company or any Subsidiary
shall enter into any agreement relating to or amending any terms or
conditions applicable to any of its Indebtedness in excess of $30,000,000
which includes covenants or defaults not substantially provided for in this
Agreement or more favorable to the lender or lenders thereunder than those
provide for in this Agreement, then the Company shall promptly so advise
the Agent and the Banks. Thereupon if the Required Banks shall request,
upon notice to the Company, the Borrowers and the Banks shall enter into an
Amendment to this Agreement providing for substantially the same covenants,
defaults and other terms and conditions as those provided for in such
agreement to the extent required and as may be selected by the Required
Banks. In addition to the foregoing, any covenants or defaults or similar
provisions (which include without limitation any provisions requiring any
47
mandatory prepayments or defeasance) contained in the Senior Unsecured
Notes or any agreements or instruments executed in connection therewith not
substantially provided for in this Agreement or more favorable to the
holders of the obligations issued in connection therewith are hereby
incorporated by reference into this Agreement to the same extent as if set
forth fully herein, and no subsequent amendment, waiver, termination or
modification thereof shall affect any such covenants, terms, conditions or
defaults as incorporated herein.
(l) Acquisitions. Make any Acquisition; provided, however, that this
Section 5.2(l) shall not prohibit any Acquisition if (i) immediately before
and after such Acquisition, no Default or Event of Default shall exist or
shall have occurred and be continuing, (ii) immediately before and after
such Acquisition, the representations and warranties contained in the Loan
Documents shall be true and correct in all material respects as if made on
the date such Acquisition is consummated, (iii) the target of the
Acquisition shall be in a similar, related or vertically related line of
business, and (iv) the Company or a Subsidiary shall be the surviving
entity.
(m) Dividends. Declare or pay any dividends or make any distributions
on its capital stock (other than dividends payable in its own common stock)
or redeem, repurchase or otherwise acquire or retire any of its capital
stock at any time outstanding, except that (i) any Subsidiary may declare
and pay dividends or make distributions to the Company or to a Wholly-Owned
Subsidiary and (ii) the Company may declare and pay dividends on its
capital stock provided that no Default or Event of Default shall exist
before or after giving effect to such dividends or be created as a result
thereof.
ARTICLE VI
DEFAULT
6.1 Events of Default. The occurrence of any one of the following
events or conditions shall be deemed an "Event of Default" hereunder unless
waived by the Required Banks or the Banks, as required pursuant to Section
8.1:
(a) Nonpayment of Principal. Any Borrower shall fail to pay when due
any principal of the Loans; or
(b) Nonpayment of Interest. Any Borrower shall fail to pay when due
any interest or any fees or any other amount payable hereunder and such
failure shall remain unremedied for five days; or
(c) Misrepresentation. Any representation or warranty made by any
Borrower in Article IV hereof, any other Loan Document or any other
certificate, report, financial statement or other document furnished by or
on behalf of any Borrower in connection with this Agreement shall prove to
have been incorrect in any material respect when made or deemed made; or
(d) Certain Covenants. Any Borrower shall fail to perform or observe
any term, covenant or agreement contained in Section 5.1(d)(i)(A) or
Section 5.2(a), (b), (c), (e) or (f) hereof; or
(e) Other Defaults. Any Borrower shall fail to perform or observe any
other term, covenant or agreement contained in this Agreement or any other
Loan Document, and any such failure shall remain unremedied for 30 calendar
days; or
48
(f) Cross Default. Any Borrower or any of their respective
Subsidiaries shall fail to pay any part of the principal of, the premium,
if any, or the interest on, or any other payment of money due under any of
its Indebtedness (other than Indebtedness hereunder), beyond any period of
grace provided with respect thereto, which individually or together with
other such Indebtedness as to which any such failure exists has an
aggregate outstanding principal amount in excess of the Threshold Amount;
or any Borrower or any of their respective Subsidiaries shall fail to
perform or observe any other term, covenant or agreement contained in any
agreement, document or instrument evidencing or securing any such
Indebtedness having such aggregate outstanding principal amount, or under
which any such Indebtedness was issued or created, beyond any period of
grace, if any, provided with respect thereto and such Borrower or such
Subsidiary has been notified by the creditor of such default; and the
effect of any such failure is either (i) to cause, or permit the holders of
such Indebtedness (or a trustee on behalf of such holders) to cause, any
payment of such Indebtedness to become due prior to its due date or (ii) to
permit the holders of such Indebtedness (or a trustee on behalf of such
holders) to elect a majority of the board of directors of the Company; or
(g) Judgments. One or more judgments or orders shall be rendered
against or shall affect any Borrower or any of their respective
Subsidiaries which causes or is likely to cause a material adverse change
in the financial condition of the Company and its Subsidiaries taken as a
whole or which does or could have a Material Adverse Effect, and either (i)
such judgment or order shall have remained unsatisfied or uninsured for a
period of 21 days and such Borrower or such Subsidiary shall not have taken
action necessary to stay enforcement thereof by reason of pending appeal or
otherwise, prior to the expiration of the applicable period of limitations
for taking such action or, if such action shall have been taken, a final
order denying such stay shall have been rendered, or (ii) enforcement
proceedings shall have been commenced by any creditor upon any such
judgment or order; or
(h) ERISA. The occurrence of a Reportable Event that results in or
could result in material liability of any Borrower, any Significant
Subsidiary of any Borrower or their ERISA Affiliates to the PBGC or to any
Plan and such Reportable Event is not corrected within thirty (30) days
after the occurrence thereof; or except where such would not have a
Material Adverse Effect, the occurrence of any Reportable Event which is
likely to constitute grounds for termination of any Plan of any Borrower,
their respective Significant Subsidiaries or their ERISA Affiliates by the
PBGC or for the appointment by the appropriate United States District Court
of a trustee to administer any such Plan and such Reportable Event is not
corrected within thirty (30) days after the occurrence thereof; or except
where such would not have a Material Adverse Effect, the filing by any
Borrower, any Significant Subsidiary of any Borrower or any of their ERISA
Affiliates of a notice of intent to terminate a Plan or the institution of
other proceedings to terminate a Plan; or any Borrower, any Significant
Subsidiary of any Borrower or any of their ERISA Affiliates shall fail to
pay when due any material liability to the PBGC or to a Plan; or except
where such would not have a Material Adverse Effect, the PBGC shall have
instituted proceedings to terminate, or to cause a trustee to be appointed
to administer, any Plan of any Borrower, their respective Significant
Subsidiaries or their ERISA Affiliates; or any person engages in a
Prohibited Transaction with respect to any Plan which results in or could
result in material liability of the any Borrower, any Significant
Subsidiary of any Borrower, any of their ERISA Affiliates, any Plan of any
Borrower, their respective Significant Subsidiaries or their ERISA
Affiliates or fiduciary of any such Plan; or except where such would not
have a Material Adverse Effect, failure by any Borrower, any Significant
Subsidiary of any Borrower or any of their ERISA Affiliates to make a
required installment or other payment to any Plan within the meaning of
Section 302(f) of ERISA or Section 412(n) of the Code that results in or
could result in liability of any Borrower, any Significant Subsidiary of
any Borrower or any of their ERISA Affiliates to the PBGC or any Plan; or
except where such would not have a Material Adverse Effect, the withdrawal
49
of any Borrower, any of their respective Significant Subsidiaries or any of
their ERISA Affiliates from a Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(9a)(2) of ERISA; or any
Borrower, any of their respective Significant Subsidiaries or any of their
ERISA Affiliates becomes an employer with respect to any Multiemployer Plan
without the prior written consent of the Required Banks; or
(i) Insolvency, Etc. Any Borrower shall be dissolved or liquidated (or
any judgment, order or decree therefor shall be entered), except as
otherwise provided pursuant to Section 5.2(e), or shall generally not pay
its debts as they become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit
of creditors, or shall institute, or there shall be instituted against any
Borrower, any proceeding or case seeking to adjudicate it a bankrupt or
insolvent or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any
law relating to bankruptcy, insolvency or reorganization or relief or
protection of debtors or seeking the entry of an order for relief, or the
appointment of a receiver, trustee, custodian or other similar official for
it or for any substantial part of its assets, rights, revenues or property,
and, if such proceeding is instituted against any Borrower and is being
contested by such Borrower in good faith by appropriate proceedings, such
proceeding shall remain undismissed or unstayed for a period of 60 days or
any writ or warrant of attachment or execution or similar process is issued
or levied against all or any material part of the property of any Borrower
and is not released, vacated or fully bonded within 60 days after its issue
or levy; or any Borrower shall take any action (corporate or other) to
authorize or further any of the actions described above in this subsection;
provided, however, that none of the foregoing acts or occurrences in this
Section 6.1(i) with respect to any Borrowing Subsidiary shall constitute an
Event of Default so long as there are no Advances outstanding to such
Borrowing Subsidiary at the time of such act or occurrence, provided, that,
the Commitment of the Banks to such Borrowing Subsidiary shall
automatically terminate without notice; or
(j) Change of Control. The Company shall experience a Change of
Control. For purposes of this Section 6.1(j), a "Change of Control" shall
occur if during any twelve-month period any person or group of persons
(within the meaning of Section 13 or 14 of the Securities Exchange Act of
1934, as amended) shall have acquired beneficial ownership (within the
meaning of Rule 13D-3 promulgated by the Securities and Exchange Commission
under said Act) of 50% or more in voting power of the voting shares of the
Company that were outstanding as of the date of this Agreement; or
(k) Loan Documents. Any Loan Document shall fail to remain in full
force and effect or any action shall be taken by any Borrower or any
Guarantor to discontinue or to assert the invalidity or unenforceability of
any Loan Document.
6.2 Remedies.
(a) Upon the occurrence and during the continuance of any Event of
Default, the Agent shall, upon being directed to do so by the Required
Banks, by notice to the Company (i) terminate the Commitments and/or (ii)
declare the outstanding principal of, and accrued interest on, the Loans
and all other amounts owing under this Agreement to be immediately due and
payable, and/or (iii) demand immediate delivery of cash collateral, and the
Borrowers agree to deliver such cash collateral upon demand, in an amount
equal to the maximum amount that may be available to be drawn at any time
prior to the stated expiry of all outstanding Letters of Credit, or any one
or more of the foregoing, whereupon the Commitments shall terminate
forthwith and all such amounts, including cash collateral, shall become
immediately due and payable, provided that in the case of any event or
condition described in Section 6.1(i) with respect to any Borrower, the
Commitments shall automatically terminate forthwith and all such amounts,
including cash collateral, shall automatically become immediately due and
payable without notice; in all cases without demand, presentment, protest,
diligence, notice of dishonor or other formality, all of which are hereby
50
expressly waived. Such cash collateral delivered in respect of outstanding
Letters of Credit shall be deposited in a special cash collateral account
to be held by the Agent as collateral security for the payment and
performance of the Borrowers' obligations under this Agreement to the Banks
and the Agent.
(b) The Agent shall, upon being directed to do so by the Required
Banks, in addition to the remedies provided in Section 6.2(a), exercise and
enforce any and all other rights and remedies available to it or the Banks,
whether arising under this Agreement, the other Loan Documents or under
applicable law, in any manner deemed appropriate by the Agent, including
suit in equity, action at law, or other appropriate proceedings, whether
for the specific performance (to the extent permitted by law) of any
covenant or agreement contained in this Agreement or any the other Loan
Document or in aid of the exercise of any power granted in this Agreement
or any other Loan Document.
(c) Upon the occurrence and during the continuance of any Event of
Default, each Bank may at any time and from time to time exercise any of
its rights of set off or bankers lien that it may possess by common law or
statute without prior notice to the Borrowers, provided that each Bank may
also set off against any deposit whether or not it is then matured. Each
Bank agrees to promptly notify the Company after any such setoff and
application, provided that the failure to give such notice shall not effect
the validity of such setoff and application. The rights of such Bank under
this Section 6.2(c) are in addition to other rights and remedies which such
Bank may have.
ARTICLE VII
THE AGENT AND THE BANKS
7.1 Appointment and Authorization. Each Bank hereby irrevocably
appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are delegated to
the Agent by the terms hereof or thereof, together with all such powers as
are reasonably incidental thereto. The provisions of this Article VII are
solely for the benefit of the Agent and the Banks, and the Borrowers shall
not have any rights as a third party beneficiary of any of the provisions
hereof. In performing its functions and duties under this Agreement, the
Agent shall act solely as agent of the Banks and does not assume and shall
not be deemed to have assumed any obligation towards or relationship of
agency or trust with or for the Borrowers.
7.2 Agent and Affiliates. JPMCB in its capacity as a Bank hereunder
shall have the same rights and powers hereunder as any other Bank and may
exercise or refrain from exercising the same as though it were not the
Agent. JPMCB and its affiliates may (without having to account therefor to
any Bank) accept deposits from, lend money to, and generally engage in any
kind of banking, trust, financial advisory or other business with any
Borrower or any Subsidiary of any Borrower as if it were not acting as
Agent hereunder, and may accept fees and other consideration therefor
without having to account for the same to the Banks.
7.3 Scope of Agent's Duties. The Agent shall have no duties or
responsibilities except those expressly set forth herein, and shall not, by
reason of this Agreement, have a fiduciary relationship with any Bank, and
no implied covenants, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or shall otherwise exist against the
Agent. As to any matters not expressly provided for by this Agreement
(including, without limitation, collection and enforcement actions), the
Agent shall not be required to exercise any discretion or take any action,
but the Agent shall take such action or omit to take any action pursuant to
the written instructions of the Required Banks and may request instructions
from the Required Banks. The Agent shall in all cases be fully protected in
51
acting, or in refraining from acting, pursuant to the written instructions
of the Required Banks, which instructions and any action or omission
pursuant thereto shall be binding upon all of the Banks; provided, however,
that the Agent shall be fully justified in failing or refusing to take any
action hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Banks pro rata against any and all
liability, cost and expense that it may incur by reason of taking or
continuing to take any such action. Except as expressly set forth in this
Agreement or any other Loan Document, the Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrowers or any of their respective
Subsidiaries that is communicated to or obtained by the bank serving as
Agent or any of its Affiliates in any capacity.
7.4 Reliance by Agent. The Agent shall be entitled to rely upon any
certificate, notice, document or other communication (including any cable,
telegram, telex, facsimile transmission or oral communication) believed by
it to be genuine and correct and to have been sent or given by or on behalf
of a proper person. The Agent may treat the payee of any note as the holder
thereof unless and until the Agent receives written notice of the
assignment thereof pursuant to the terms of this Agreement signed by such
payee and the Agent receives the written agreement of the assignee that
such assignee is bound hereby to the same extent as if it had been an
original party hereto. The Agent also may rely upon any statement made to
it orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon. The Agent
may employ agents (including without limitation collateral agents) and may
consult with legal counsel (who may be counsel for the Borrowers),
independent public accountants and other experts selected by it and shall
not be liable to the Banks, except as to money or property received by it
or its authorized agents, for the negligence or misconduct of any such
agent selected by it with reasonable care or for any action taken or
omitted to be taken by it in good faith in accordance with the advice of
such counsel, accountants or experts.
7.5 Default. The Agent shall not be deemed to have knowledge of the
occurrence of any Default or Event of Default, except with respect to
defaults in the payment of principal, interest and fees required to be paid
to the Agent for the account of the Banks, unless the Agent has received
written notice from a Bank or a Borrower specifying such Default or Event
of Default and stating that such notice is a "Notice of Default". In the
event that the Agent receives such a notice, the Agent shall give prompt
written notice thereof to the Banks.
7.6 Liability of Agent. Neither the Agent nor any of its directors,
officers, agents, or employees shall be liable to the Banks for any action
taken or not taken by it or them in connection herewith with the consent or
at the request of the Required Banks or in the absence of its or their own
gross negligence or willful misconduct. Except for duties expressly
accepted by the Agent hereunder, neither the Agent nor any of its
directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into or verify (i) any recital, statement,
warranty or representation contained in this Agreement or any Guaranty, or
in any certificate, report, financial statement or other document furnished
in connection with this Agreement, (ii) the performance or observance of
any of the covenants or agreements of any Borrower or any Guarantor, (iii)
the satisfaction of any condition specified in Article II hereof, or (iv)
the validity, effectiveness, legal enforceability, value or genuineness of
this Agreement or any Loan Document or any collateral subject thereto or
any other instrument or document furnished in connection herewith.
7.7 Nonreliance on Agent and Other Banks. Each Bank acknowledges and
agrees that it has, independently and without reliance on the Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrowers and decision to
enter into this Agreement and that it will, independently and without
reliance upon the Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own analysis and decision in taking or not taking action under this
52
Agreement. The Agent shall not be required to keep itself informed as to
the performance or observance by any Borrower or any Guarantor of this
Agreement or any other documents referred to or provided for herein or to
inspect the properties or books of any Borrower or any Guarantor and,
except for notices, reports and other documents and information expressly
required to be furnished to the Banks by the Agent or any Borrower
hereunder, the Agent shall not have any duty or responsibility to provide
any Bank with any information concerning the affairs, financial condition
or business of the Borrowers or any of their respective Subsidiaries which
may come into the possession of the Agent or any of its affiliates.
7.8 Indemnification. The Banks agree to indemnify the Agent (to the
extent not reimbursed by the Borrowers, but without limiting any obligation
of the Borrowers to make such reimbursement), ratably according to the
respective principal amounts of the Advances then outstanding made by each
of them (or if no Advances are at the time outstanding, ratably according
to the respective amounts of their Commitments), from and against any and
all claims, damages, losses, liabilities, costs or expenses of any kind or
nature whatsoever (including, without limitation, fees and disbursements of
counsel) which may be imposed on, incurred by, or asserted against the
Agent in any way relating to or arising out of this Agreement or the
transactions contemplated hereby or any action taken or omitted by the
Agent under this Agreement, provided, however, that no Bank shall be liable
for any portion of such claims, damages, losses, liabilities, costs or
expenses resulting from the Agent's gross negligence or willful misconduct.
Without limitation of the foregoing, each Bank agrees to reimburse the
Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including without limitation fees and expenses of counsel)
incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice
in respect of rights or responsibilities under, this Agreement, to the
extent that the Agent is not reimbursed for such expenses by the Borrowers,
but without limiting the obligation of the Borrowers to make such
reimbursement. Each Bank agrees to reimburse the Agent promptly upon demand
for its ratable share of any amounts owing to the Agent by the Banks
pursuant to this Section.
7.9 Resignation of Agent. The Agent may resign as such at any time
upon thirty days' prior written notice to the Borrowers and the Banks. In
the event of any such resignation, the Company shall, by an instrument in
writing delivered to the Banks and the Agent, appoint a successor, which
shall be a Bank or any other commercial bank organized under the laws of
the United States or any State thereof and having a combined capital and
surplus of at least $500,000,000; provided, that, if an Event of Default
has occurred and is continuing at the time of such resignation, the
Required Banks shall have the right to appoint, on behalf of the Borrowers
and the Banks, the successor agent. If a successor is not so appointed or
does not accept such appointment before the Agent's resignation becomes
effective, the resigning Agent may appoint a temporary successor to act
until such appointment by the Company is made and accepted any successor to
the Agent shall execute and deliver to the Borrowers and the Banks an
instrument accepting such appointment and thereupon such successor Agent,
without further act, deed, conveyance or transfer shall become vested with
all of the properties, rights, interests, powers, authorities and
obligations of its predecessor hereunder with like effect as if originally
named as Agent hereunder. Upon the acceptance of its appointment as Agent
hereunder by a successor, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. The fees payable by the Borrower to a
successor Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. Upon
request of such successor Agent, the Borrowers and the resigning Agent
shall execute and deliver such instruments of conveyance, assignment and
further assurance and do such other things as may reasonably be required
for more fully and certainly vesting and confirming in such successor Agent
all such properties, rights, interests, powers, authorities and
53
obligations. The provisions of this Article VII shall thereafter remain
effective for such resigning Agent with respect to any actions taken or
omitted to be taken by such Agent while acting as the Agent hereunder.
7.10 Sharing of Payments. The Banks agree among themselves that, in
the event that any Bank shall obtain payment in respect of any Advance or
any other obligation owing to the Banks under this Agreement through the
exercise of a right of set-off, banker's lien, counterclaim or otherwise in
excess of its ratable share of payments received by all of the Banks on
account of the Advances and other obligations (or if no Advances are
outstanding, ratably according to the respective amounts of the
Commitments), such Bank shall promptly purchase from the other Banks
participations in such Advances and other obligations in such amounts, and
make such other adjustments from time to time, as shall be equitable to the
end that all of the Banks share such payment in accordance with such
ratable shares. The Banks further agree among themselves that if payment to
a Bank obtained by such Bank through the exercise of a right of set-off,
banker's lien, counterclaim or otherwise as aforesaid shall be rescinded or
must otherwise be restored, each Bank which shall have shared the benefit
of such payment shall, by repurchase of participations theretofore sold,
return its share of that benefit to each Bank whose payment shall have been
rescinded or otherwise restored. The Borrowers agree that any Bank so
purchasing such a participation may, to the fullest extent permitted by
law, exercise all rights of payment, including set-off, banker's lien or
counterclaim, with respect to such participation as fully as if such Bank
were a holder of such Advance or other obligation in the amount of such
participation. The Banks further agree among themselves that, in the event
that amounts received by the Banks and the Agent hereunder are insufficient
to pay all such obligations or insufficient to pay all such obligations
when due, the fees and other amounts owing to the Agent in such capacity
shall be paid therefrom before payment of obligations owing to the Banks
under this Agreement, other than agency fees payable pursuant to Section
2.5(d) of this Agreement which shall be paid on a pro rata basis with
amounts owing to the Banks. Except as otherwise expressly provided in this
Agreement, if any Bank or the Agent shall fail to remit to the Agent or any
other Bank an amount payable by such Bank or the Agent to the Agent or such
other Bank pursuant to this Agreement on the date when such amount is due,
such payments shall be made together with interest thereon for each date
from the date such amount is due until the date such amount is paid to the
Agent or such other Bank at a rate per annum equal to the rate at which
borrowings are available to the payee in its overnight federal funds
market. It is further understood and agreed among the Banks and the Agent
that if the Agent or any Bank shall engage in any other transactions with
any Borrower and shall have the benefit of any collateral or security
therefor which does not expressly secure the obligations arising under this
Agreement except by virtue of a so-called dragnet clause or comparable
provision, the Agent or such Bank shall be entitled to apply any proceeds
of such collateral or security first in respect of the obligations arising
in connection with such other transaction before application to the
obligations arising under this Agreement.
7.11 Withholding Tax Exemption. (a) Each Bank that is not organized
and incorporated under the laws of the United States or any State thereof
agrees to file with the Agent and the Company, in duplicate, (i) on or
before the later of (A) the Effective Date and (B) the date such Bank
becomes a Bank under this Agreement and (ii) thereafter, renewals or
additional copies of such form (or any successor form) on or before the
date such form expires or becomes obsolete, unless not legally able to do
so as a result of a change in United States income tax enacted, or treaty
promulgated, after the date specified in the preceding clause (i), on or
prior to the immediately following due date of any payment by the Company
hereunder, a properly completed and executed copy of either Internal
Revenue Service Form W-8BEN or Internal Revenue Service Form W-8ECI and
Internal Revenue Service Form W-8 or Internal Revenue Service Form W-9 and
any additional form necessary for claiming complete exemption from United
States withholding taxes (or such other form as is required to claim
complete exemption from Unites States withholding taxes), if and as
provided by the Internal Revenue Code or other pronouncements of the United
States Internal Revenue Service, and such Bank warrants to the Company that
the form so filed will be true and complete; provided that such Bank's
failure to complete and execute such Form W-8BEN or Form W-8ECI, or Form
54
W-8 or Form W-9, as the case may be, and any such additional form (or any
successor form or forms) shall not relieve the Company of any of its
obligations under this Agreement, except as otherwise provided in this
Section 7.11.
(b) Prior to making any Loan denominated in Pounds, each Bank that is
making any portion of such Loan and that is neither a resident of the
United Kingdom nor a bank carrying on a bona fide banking business in the
United Kingdom agrees to furnish to the Agent and the Company evidence
satisfactory to the Agent and the Company that such Bank has filed with the
United Kingdom Inland Revenue a "Claim on Behalf of a United States
Domestic Corporation to Relief from United Kingdom Income Tax on Interest
and Royalties Arising in the United Kingdom" or other appropriate form or
forms of exemption from withholding tax and received from the Inland
Revenue authority that payments to such Bank by any Borrower hereunder may
be made gross; provided that such Bank's failure to furnish such evidence
shall not relieve any Borrower of its obligations under this Agreement,
except as otherwise provided in this Section 7.11. Upon an Event of
Default, each Bank which is neither a resident of the United Kingdom nor a
bank carrying on a bona fide banking business in the united Kingdom agrees
to furnish, as soon as practicable, to the Agent and the Company evidence
satisfactory to the Agent and the Company that such Bank has filed with the
United Kingdom Inland Revenue a claim on behalf of a United States Domestic
Corporation to Relief from United Kingdom Income Tax on Interest and
Royalties Arising in the United Kingdom or other appropriate form or forms
of exemption from withholding tax and received form the Inland Revenue
authority that payments to such Bank by the Company hereunder may be made
gross; provided that such Bank's failure to furnish such evidence shall not
relieve any Borrower of its obligations under this Agreement, except as
otherwise provided in this Section 7.11.
7.12 Co-Agent, Documentation Agents, Syndication Agent, Etc. No Bank
identified in this Agreement as a "co-agent", "documentation agent" or
"syndication agent" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to
all Banks as such. Without limiting the foregoing, none of such Banks shall
have or be deemed to have a fiduciary relationship with any Bank. Each Bank
hereby makes the same acknowledgments with respect to such Banks as it
makes with respect to the Agent in Section 7.7.
ARTICLE VIII
MISCELLANEOUS
8.1 Amendments, Etc.
(a) No amendment, modification, termination or waiver of any provision
of this Agreement nor any consent to any departure therefrom shall be
effective unless the same shall be in writing and signed by the Borrowers
and the Required Banks and, to the extent any rights or duties of the Agent
may be affected thereby, the Agent, provided, however, that no such
amendment, modification, termination, waiver or consent shall, without the
consent of the Agent and all of the Banks, (i) authorize or permit the
extension of time for, or any reduction of the amount of, any payment of
the principal of, or interest on, the Advances or any Letter of Credit
reimbursement obligation, or any fees or other amount payable hereunder,
(ii) amend or terminate the respective Commitment of any Bank set forth on
Schedule 1.1 (except as provided in Section 2.1(d) or Section 2.4(c)) or
modify the provisions of this Section regarding the taking of any action
under this Section or the provisions of Section 7.10, Section 8.6(a) or the
definition of Required Banks or (iii) amend or modify the Guaranty (other
than any amendment solely for the purpose of adding or deleting a Borrowing
Subsidiary) or provide for the release or discharge of the Company's
obligations under the Guaranty.
55
(b) Any such amendment, waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
(c) Notwithstanding anything herein to the contrary, no Bank that is
in default of any of its obligations, covenants or agreements under this
Agreement shall be entitled to vote (whether to consent or to withhold its
consent) with respect to any amendment, modification, termination or waiver
of any provision of this Agreement or any departure therefrom or any
direction from the Banks to the Agent, and, for purposes of determining the
Required Banks at any time when any Bank is in default under this
Agreement, the Commitments and Advances of such defaulting Banks shall be
disregarded.
8.2 Notices.
(a) Except as otherwise provided in Section 8.2(c) hereof, all notices
and other communications hereunder shall be in writing and shall be
delivered or sent to the Borrowers in care of the Treasury Manager at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇▇▇▇▇, Facsimile No.
(▇▇▇) ▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇ and to the Agent and the Banks at
the respective addresses and numbers for notices set forth on the
signatures pages hereof, or to such other address as may be designated by
any Borrower, the Agent or any Bank by notice to the other parties hereto.
All notices and other communications shall be deemed to have been given at
the time of actual delivery thereof to such address, or if sent by
certified or registered mail, postage prepaid, to such address, on the
third day after the date of mailing, or if deposited prepaid with Federal
Express or other nationally recognized overnight delivery service prior to
the deadline for next day delivery, on the Business Day next following such
deposit, provided, however, that notices to the Agent shall not be
effective until received.
(b) Notices by the Treasury Manager or a Borrower to the Agent with
respect to terminations or reductions of the Commitments pursuant to
Section 2.4, requests for Advances pursuant to Section 2.6, requests for
continuations or conversions of Loans pursuant to Section 2.9 and notices
of prepayment pursuant to Section 3.1 shall be irrevocable and binding on
the Borrowers.
(c) Any notice to be given by the Treasury Manager or a Borrower to
the Agent pursuant to Sections 2.6 or 2.9 and any notice to be given by the
Agent or any Bank hereunder, may be given by telephone, and all such
notices given by the Treasury Manager or a Borrower must be immediately
confirmed in writing or by e-mail, in the manner provided in Section
8.2(a). Any such notice given by telephone shall be deemed effective upon
receipt thereof by the party to whom such notice is to be given.
8.3 No Waiver By Conduct; Remedies Cumulative. No course of dealing on
the part of the Agent or any Bank, nor any delay or failure on the part of
the Agent or any Bank in exercising any right, power or privilege hereunder
shall operate as a waiver of such right, power or privilege or otherwise
prejudice the Agent's or such Bank's rights and remedies hereunder; nor
shall any single or partial exercise thereof preclude any further exercise
thereof or the exercise of any other right, power or privilege. No right or
remedy conferred upon or reserved to the Agent or any Bank under this
Agreement, any Guaranty or any other Loan Document is intended to be
exclusive of any other right or remedy, and every right and remedy shall be
cumulative, except as limited by this Agreement, and in addition to every
other right or remedy granted thereunder or now or hereafter existing under
any applicable law. Every right and remedy granted by this Agreement, any
Guaranty or any other Loan Document or by applicable law to the Agent or
any Bank may be exercised from time to time and as often as may be deemed
56
expedient by the Agent or any Bank and, unless contrary to the express
provisions of this Agreement, such Guaranty or such Loan Document,
irrespective of the occurrence or continuance of any Default or Event of
Default.
8.4 Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of any Borrower or
any Guarantor made herein, in any Guaranty or in any certificate, report,
financial statement or other document furnished by or on behalf of any
Borrower or any Guarantor in connection with this Agreement shall be deemed
to be material and to have been relied upon by the Banks, notwithstanding
any investigation heretofore or hereafter made by any Bank or on such
Bank's behalf, and those covenants and agreements of the Borrowers set
forth in Sections 3.6, 3.8, 5.1(f) and 8.5 hereof shall survive the
repayment in full of the Advances and the termination of the Commitments
for a period of one year from such repayment or termination.
8.5 Expenses; Indemnification. (a) The Company agrees to pay, or
reimburse the Agent for the payment of, on demand, (i) the reasonable fees,
without premium, and reasonable expenses of counsel to the Agent, including
without limitation the reasonable fees and expenses of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
PLLC as agreed upon with the Company in connection with the preparation,
execution, delivery and administration of the Loan Documents and the
consummation of the transactions contemplated hereby, and in connection
with advising the Agent as to its rights and responsibilities with respect
thereto, and in connection with any amendments, waivers or consents in
connection therewith, (ii) all stamp and other taxes and fees payable in
connection with the execution, delivery, filing or recording of this
Agreement and the consummation of the transactions contemplated hereby, and
any and all liabilities with respect to or resulting from any delay in
paying or omitting to pay such taxes or fees, (iii) all reasonable costs
and expenses of the Agent (including without limitation reasonable fees and
expenses of counsel, which counsel shall be acceptable to the Required
Banks, including without limitation counsel who are employees of the Agent,
and whether incurred through negotiations, legal proceedings or otherwise)
in connection with any Default or Event of Default or the enforcement of,
or the exercise or preservation of any rights under the Loan Documents or
in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement, (iv) any costs, internal
charges and expenses (including without limitation reasonable fees and
expenses of counsel, which attorneys may be employees of the Banks) paid or
incurred by the Agent or any Bank in connection with the collection and
enforcement of the Loan Documents, and (v) all reasonable costs and
expenses of the Agent and the Banks (including reasonable fees and expenses
of counsel) in connection with any action or proceeding relating to a court
order, injunction or other process or decree restraining or seeking to
restrain the Agent from paying any amount under, or otherwise relating in
any way to, any Letter of Credit and any and all costs and expenses which
any of them may incur relative to any payment under any Letter of Credit.
(b) Each Borrower hereby indemnifies and agrees to hold harmless the
Banks and the Agent, and their respective Related Parties, from and against
any and all claims, damages, losses, liabilities, costs or expenses of any
kind or nature whatsoever which the Banks or the Agent or any such Related
Party may incur or which may be claimed against any of them by reason of or
in connection with entering into this Agreement or the transactions
contemplated hereby (whether or not such Bank, the Agent or such other
Related Party is a party to the claim, demand, action, cause of action or
proceeding giving rise to such claim, damage, loss, liability, cost or
expense); provided, however, that no Borrower shall be required to
indemnify any such Bank and the Agent or such other Related Party, to the
extent, but only to the extent, that such claim, damage, loss, liability,
cost or expense is attributable to the gross negligence or willful
misconduct of such Bank or the Agent, as the case may be, as determined by
a court of competent jurisdiction in a final, non-appealable judgment.
8.6 Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate
57
of the Agent that issues any Letter of Credit), except that (i) a Borrower
may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Bank (and any attempted
assignment or transfer by any Borrower without such consent shall be null
and void) and (ii) no Bank may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section. Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and
assigns permitted hereby (including any Affiliate of the Agent that issues
any Letter of Credit), Participants (to the extent provided in paragraph
(c) of this Section) and, to the extent expressly contemplated hereby, the
Related Parties of each of the Agent and the Banks) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b)(i) Subject to the conditions set forth in paragraph (b)(ii) below,
any Bank may assign to one or more assignees all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld) of:
(A) the Company, provided that no consent of the Company shall be
required for an assignment to a Bank, an Affiliate of a Bank, an
Approved Fund or, if an Event of Default has occurred and is
continuing, any other assignee; and
(B) the Agent, except in the case of an assignment to a Bank.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Bank or an Affiliate
of a Bank or an assignment of the entire remaining amount of the
assigning Bank's Commitment or Loans, the amount of the Commitment or
Loans of the assigning Bank subject to each such assignment
(determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Agent) shall not be less than
$5,000,000 unless each of the Company and the Agent otherwise consent,
provided that no such consent of the Company shall be required if an
Event of Default has occurred and is continuing;
(B) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Bank 's rights and obligations
under this Agreement;
(C) the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500; and
(D) the assignee, if it shall not be a Bank, shall deliver to the
Agent an Administrative Questionnaire.
For the purposes of this Section 8.6, the term "Approved Fund"
has the following meaning:
"Approved Fund" means any Person (other than a natural person) that is
engaged in making, purchasing, holding or investing in bank loans and
similar extensions of credit in the ordinary course of its business and
that is administered or managed by (a) a Bank, (b) an Affiliate of a Bank
or (c) an entity or an Affiliate of an entity that administers or manages a
Bank.
58
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date
specified in each Assignment and Assumption the assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Bank under
this Agreement, and the assigning Bank thereunder shall, to the extent of
the interest assigned by such Assignment and Assumption, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Bank's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto but
shall continue to be entitled to the benefits of Sections 3.4, 3.6, 3.8 and
8.5). Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 8.6 shall be treated
for purposes of this Agreement as a sale by such Lender of a participation
in such rights and obligations in accordance with paragraph (c) of this
Section.
(iv) The Agent, acting for this purpose as an agent of the Borrowers,
shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names
and addresses of the Banks, and the Commitment of, and principal amount of
the Advances owing to, each Bank pursuant to the terms hereof from time to
time (the "Register"). The entries in the Register shall be conclusive, and
the Borrowers, the Agent and the Banks may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Bank hereunder
for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for inspection by the Borrowers and any
Bank, at any reasonable time and from time to time upon reasonable prior
notice.
(v) Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Bank and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Bank
hereunder), the processing and recordation fee referred to in paragraph (b)
of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register;
provided that if either the assigning Bank or the assignee shall have
failed to make any payment required to be made by it pursuant to Section
2.1(f), 2.3(c), 2.6(b), 2.6(e) or 7.8), the Agent shall have no obligation
to accept such Assignment and Assumption and record the information therein
in the Register unless and until such payment shall have been made in full,
together with all accrued interest thereon. No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.
(c)(i) Any Bank may, without the consent of the Company or the Agent,
sell participations to one or more banks or other entities (a
"Participant") in all or a portion of such Bank's rights and obligations
under this Agreement (including all or a portion of its Commitment and the
Loans owing to it); provided that (A) such Bank's obligations under this
Agreement shall remain unchanged, (B) such Bank shall remain solely
responsible to the other parties hereto for the performance of such
obligations and (C) the Borrowers, the Agent and the other Banks shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Bank sells such a participation shall
provide that such Bank shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any
provision of this Agreement; provided that such agreement or instrument may
provide that such Bank will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in the proviso to
Section 8.1(a) that affects such Participant. Subject to paragraph (c)(ii)
of this Section, the Borrowers agree that each Participant shall be
entitled to the benefits of Sections 3.4, 3.6, 3.7 and 3.8 to the same
extent as if it were a Bank and had acquired its interest by assignment
pursuant to paragraph (b) of this Section. To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 6.2(c)
59
as though it were a Bank, provided such Participant agrees to be subject to
Section 7.10 as though it were a Bank.
(ii) A Participant shall not be entitled to receive any greater
payment under Section 3.4 or 3.6 than the applicable Bank would have been
entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Company's prior written consent. A Participant that would be
a Foreign Bank if it were a Bank shall not be entitled to the benefits of
Section 3.4 unless the Company is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 7.11 as though it were a Bank.
(d) Any Bank may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations
of such Bank, including without limitation any pledge or assignment to
secure obligations to a Federal Reserve Bank, and this Section shall not
apply to any such pledge or assignment of a security interest; provided
that no such pledge or assignment of a security interest shall release a
Bank from any of its obligations hereunder or substitute any such pledgee
or assignee for such Bank as a party hereto.
8.7 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart.
8.8 Governing Law; Consent to Jurisdiction. This Agreement is a
contract made under, and shall be governed by and construed in accordance
with, the law of the State of
Illinois applicable to contracts made and to
be performed entirely within such State and without giving effect to choice
of law principles of such State. Each Borrower further agrees that any
legal action or proceeding with respect to this Agreement or any other Loan
Document or the transactions contemplated hereby shall be brought in any
court of the State of
Illinois, or in any court of the United States of
America sitting in
Illinois, and each Borrower hereby irrevocably submits
to and accepts generally and unconditionally the jurisdiction of those
courts with respect to its person and property, and irrevocably appoints
_______________, whose address is set forth in Section 8.2, as its agent
for service of process and irrevocably consents to the service of process
in connection with any such action or proceeding by personal delivery to
such agent or to the Borrowers or by the mailing thereof by registered or
certified mail, postage prepaid to the Borrowers at the address set forth
in Section 8.2. Nothing in this paragraph shall affect the right of the
Banks and the Agent to serve process in any other manner permitted by law
or limit the right of the Banks or the Agent to bring any such action or
proceeding against the Borrowers or property in the courts of any other
jurisdiction. Each Borrower hereby irrevocably waives any objection to the
laying of venue of any such suit or proceeding in the above described
courts.
8.9 Table of Contents and Headings. The table of contents and the
headings of the various subdivisions hereof are for the convenience of
reference only and shall in no way modify any of the terms or provisions
hereof.
8.10 Construction of Certain Provisions. If any provision of this
Agreement refers to any action to be taken by any person, or which such
person is prohibited from taking, such provision shall be applicable
whether such action is taken directly or indirectly by such person, whether
or not expressly specified in such provision.
8.11 Integration and Severability. This Agreement and the other Loan
Documents embody the entire agreement and understanding between the
Borrowers and the Agent and the Banks, and supersede all prior agreements
and understandings, relating to the subject matter hereof. In case any one
60
or more of the obligations of any Borrower under this Agreement or any
other Loan Document shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
obligations of such Borrower and the other Borrowers shall not in any way
be affected or impaired thereby, and such invalidity, illegality or
unenforceability in one jurisdiction shall not affect the validity,
legality or enforceability of the obligations of the Borrowers under this
Agreement or any other Loan Document in any other jurisdiction.
8.12 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not
permitted by any such covenant, the fact that it would be permitted by an
exception to, or would be otherwise within the limitations of, another
covenant shall not avoid the occurrence of a Default or an Event of Default
if such action is taken or such condition exists.
8.13 Interest Rate Limitation. Notwithstanding any provisions of this
Agreement, in no event shall the amount of interest paid or agreed to be
paid by any Borrower exceed an amount computed at the highest rate of
interest permissible under applicable law. If, from any circumstances
whatsoever, fulfillment of any provision of this Agreement at the time
performance of such provision shall be due, shall involve exceeding the
interest rate limitation validly prescribed by law which a court of
competent jurisdiction may deem applicable hereto, then, ipso facto, the
obligations to be fulfilled shall be reduced to an amount computed at the
highest rate of interest permissible under applicable law, and if for any
reason whatsoever any Bank shall ever receive as interest an amount which
would be deemed unlawful under such applicable law such interest shall be
automatically applied to the payment of principal of such Bank's Advances
outstanding hereunder (whether or not then due and payable) and not to the
payment of interest, or shall be refunded to the Borrowers if such
principal and all other obligations of the Borrowers to such Bank have been
paid in full.
8.14 Confidentiality. The Banks and the Agent shall hold all
confidential information obtained pursuant to the requirements of this
Agreement in accordance with their customary procedures for handling
confidential information of this nature and in accordance with safe and
sound banking practices and in any event may make disclosure to its
examiners, affiliates, outside auditors, counsel and other professional
advisors in connection with this Agreement or as reasonably required by any
bona fide transferee or participant in connection with the contemplated
transfer of any Loans or participation therein or as required or requested
by any governmental or regulatory agency or representative thereof or
pursuant to legal process or with the prior consent of the Company. Without
limiting the foregoing, it is expressly understood that such confidential
information shall not include information which, at the time of disclosure
is in the public domain or, which after disclosure, becomes part of the
public domain or information which is obtained by any Bank or the Agent
prior to the time of disclosure and identification by the Company under
this Section, or information received by any Bank or the Agent from a third
party unless such third party is bound by this Agreement. Nothing in this
Section or otherwise shall prohibit any Bank or the Agent from disclosing
any confidential information to the other Banks or the Agent or render any
of them liable in connection with any such disclosure.
8.15 Waiver of Jury Trial. The Borrowers, the Banks and the Agent,
after consulting or having had the opportunity to consult with counsel,
knowingly, voluntarily and intentionally waive any right either of them may
have to a trial by jury in any litigation based upon or arising out of this
Agreement or any other Loan Document or any of the transactions
contemplated by this Agreement or any course of conduct, dealing,
statements (whether oral or written) or actions of any of them. Neither any
Borrower, any Bank nor the Agent shall seek to consolidate, by counterclaim
or otherwise, any such action in which a jury trial has been waived with
any other action in which a jury trial cannot be or has not been waived.
These provisions shall not be deemed to have been modified in any respect
or relinquished by any party hereto except by a written instrument executed
by such party.
61
8.16 Unification of Certain Currencies. Without prejudice to any
method of conversion or rounding prescribed by any legislative measures of
the European Council (including without limitation, Regulation 1103/97 of
17 June 1997), each reference in this Agreement to a fixed amount or to
fixed amounts in a National Currency Unit to be paid to or by the Agent
shall, notwithstanding any other provision of this Agreement, be replaced
by a reference to such comparable and convenient fixed amount or fixed
amounts in the Euro as the Agent may from time to time specify.
8.17 USA Patriot Act. Each Bank that is subject to the Act (as
hereinafter defined) and the Agent (for itself and not on behalf of any
Bank) hereby notifies each Borrower that pursuant to the requirements of
the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October
26, 2001)) (the "Act"), it is required to obtain, verify and record
information that identifies such Borrower, which information includes the
name and address of such Borrower and other information that will allow
such Bank or the Agent, as applicable, to identify such Borrower in
accordance with the Act.
62
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered on the _____ day of January, 2005.
INVACARE CORPORATION
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Vice President & CFO
INVACARE (DEUTSCHLAND) GmbH
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
INVACARE AUSTRALIA PTY. LTD.
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
INVACARE CANADA INC.
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
INVACARE S.A.
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
INVACARE (UK) LIMITED
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
63
INVACARE INTERNATIONAL SARL
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Vice President & CFO
DOMUS HOMECARE AG
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
INVACARE HOLDINGS CV
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
SCANDINAVIAN MOBILITY INTERNATIONAL APS
By: /c/▇▇▇▇ ▇▇▇▇▇▇▇▇
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Officer
64
Address for Notices: JPMORGAN CHASE BANK, N.A., as a Bank and as
Agent
▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ By: /s/▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇ Title: Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: KEYBANK NATIONAL ASSOCIATION, as a Bank and
Syndication Agent
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/▇.▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ Print Name: ▇.▇. ▇▇▇▇▇▇
Attention: ▇.▇. ▇▇▇▇▇▇ Title: Senior Vice President
Facsimile No.:(▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.:(▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: NATIONAL CITY BANK, as a Bank and Documentation
Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Loc. 2077 By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Title: Senior Vice President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: BANK OF AMERICA, N.A., as a Bank and
Documentation Agent
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇ Title: Vice President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
65
Address for Notices: CALYON NEW YORK BRANCH
1301 Avenue of the Americas By: /s/Attila Coach
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Print Name: Attila Coach
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇ Title: Managing Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Director
Address for Notices: ▇▇▇▇▇▇ TRUST AND SAVINGS BANK
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Title: Managing Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: NORDEA BANK FINLAND PLC,
NEW YORK BRANCH
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Attention:Loan Administration Its: First Vice President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ -and-
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Senior Vice President - Credit
Address for Notices: PNC BANK, NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Title: Managing Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
66
Address for Notices: SUNTRUST BANK
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ Title: Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: THE BANK OF NEW YORK
One Wall Street By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Title: Vice President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A.
"RABOBANK INTERNATIONAL",
NEW YORK BRANCH
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Title: Executive Director
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Print Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Director
67
PRICING SCHEDULE
====================== ===================== ====================== ===================== ==================== =====================
APPLICABLE MARGIN LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS LEVEL IV STATUS LEVEL V STATUS
====================== ===================== ====================== ===================== ==================== =====================
====================== ===================== ====================== ===================== ==================== =====================
Eurocurrency Rate 0.35% 0.425% 0.50% 0.575% 0.675%
====================== ===================== ====================== ===================== ==================== =====================
====================== ===================== ====================== ===================== ==================== =====================
APPLICABLE FEE RATE LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS LEVEL IV STATUS LEVEL V STATUS
====================== ===================== ====================== ===================== ==================== =====================
---------------------- --------------------- ---------------------- --------------------- -------------------- ---------------------
Letter of Credit Fee 0.35% 0.425% 0.50% 0.575% 0.675%
---------------------- --------------------- ---------------------- --------------------- -------------------- ---------------------
Facility Fee 0.10% 0.125% 0.15% 0.175% 0.20%
===================== ===================== ====================== ===================== ==================== =====================
For the purposes of this Schedule, the following terms have the
following meanings and all other capitalized terms used but not defined
herein shall have the meanings set forth in the Agreement, subject to the
final paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Company delivered pursuant to the Agreement.
"Level I Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials,
the Leverage Ratio is less than or equal to 1.50 to 1.00.
"Level II Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials,
(i) the Company has not qualified for Level I Status and (ii) the Leverage
Ratio is less than 2.0 to 1.00.
"Level III Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials,
(i) the Company has not qualified for Level I Status or Level II Status and
(ii) the Leverage Ratio is less than 2.50 to 1.00.
"Level IV Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials,
(i) the Company has not qualified for Level I Status, Level II Status or
Level III Status and (ii) the Leverage Ratio is less than 3.00 to 1.0.
"Level V Status" exists at any date if the Company has not qualified
for Level I Status, Level II Status, Level III Status or Level IV Status.
"Status" means Level I Status, Level II Status, Level III Status,
Level IV Status or Level V Status.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Company's Status as
reflected in the then most recent Financials. Adjustments, if any, to the
Applicable Margin or Applicable Fee Rate shall be effective five Business
Days after the Agent has received the applicable Financials. If the Company
fails to deliver the Financials to the Agent at the time required pursuant
to the Credit Agreements, then the Applicable Margin and Applicable Fee
Rate shall be the highest Applicable Margin and Applicable Fee Rate set
forth in the foregoing table until five days after such Financials are so
delivered.
68
SCHEDULE 1.1
COMMITMENTS
January 14, 2005
--------------------------------------------------------------------------------
COMMITMENTS
================================================================================
----------------------------------------------- --------------------------------
Bank Commitment
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
JPMorgan Chase Bank, N.A. $62,500,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
KeyBank National Association 62,500,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
National City Bank 50,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Bank of America, NA. 50,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Calyon New York Branch 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
▇▇▇▇▇▇ Bank Trust and Savings 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Nordea Bank Finland Plc, New York Branch 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
PNC Bank, National Association 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
SunTrust Bank 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
The Bank of New York 25,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Rabobank International, New York Branch 25,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
$450,000,000
----------------------------------------------- --------------------------------
69
--------------------------------------------------------------------------------
REVOLVING CREDIT COMMITMENTS
================================================================================
----------------------------------------------- --------------------------------
Bank Revolving Credit Commitment
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
JPMorgan Chase Bank, N.A. $22,500,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
KeyBank National Association 62,500,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
National City Bank 25,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Bank of America, NA. 50,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Calyon New York Branch 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
▇▇▇▇▇▇ Bank Trust and Savings 0
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Nordea Bank Finland Plc, New York Branch 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
PNC Bank, National Association 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
SunTrust Bank 35,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
The Bank of New York 25,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Rabobank International, New York Branch 25,000,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
$350,000,000
----------------------------------------------- --------------------------------
--------------------------------------------------------------------------------
ALTERNATE CURRENCY COMMITMENTS
================================================================================
========================= =========================== ==========================
Bank Alternate Currency Alternate Currency
Facility
------------------------- --------------------------- --------------------------
------------------------- --------------------------- --------------------------
JPMorgan Chase Bank, N.A. Canadian Dollars USD $40,000,000
------------------------- --------------------------- --------------------------
------------------------- --------------------------- --------------------------
National City Bank Canadian Dollars USD $25,000,000
------------------------- --------------------------- --------------------------
------------------------- --------------------------- --------------------------
▇▇▇▇▇▇ Bank Trust and Savings Canadian Dollars USD $35,000,000
------------------------ --------------------------- ---------------------------
70
EXHIBIT A
FORM OF
BANK ADDITION AND ACKNOWLEDGEMENT AGREEMENT
Dated
Reference is made to the Credit Agreement dated as of January 14, 2005
(as amended or supplemented from time to time, the "Credit Agreement") by
and among
Invacare Corporation, a corporation organized under the laws of
Ohio (the "Company"), certain Borrowing Subsidiaries who are or may become
party thereto (collectively with the Company, the "Borrowers"), the Banks
who are or may become party thereto (collectively, the "Banks") and
JPMorgan Chase Bank, N.A. as Agent for the Banks (the "Agent"). Capitalized
terms which are defined in the Credit Agreement and which are used herein
without definition shall have the same meanings herein as in the Credit
Agreement.
The Borrowers and _________________________________ (the "[New or
Current] Bank") agree as follows:
1. Subject to Section 2.4(c) of the Credit Agreement and this Bank
Addition and Acknowledgement Agreement, the Borrowers hereby increase the
Aggregate Commitments from $__________ to $_____________ (such increased
amount not to exceed $550,000,000). This Bank Addition and Acknowledgement
Agreement is entered into pursuant to, and authorized by, Section 2.4(c) of
the Credit Agreement.
2. The parties hereto acknowledge and agree that, as of the date
hereof, (a) the percentage of the Aggregate Commitments under the Credit
Agreement of each Bank, including without limitation, the [New or Current]
Bank, (b) the Commitment under the Credit Agreement of each Bank,
including, without limitation, the [New or Current] Bank, and (c) the
outstanding balances of the Loans under the Credit Agreement made by each
Bank, including, without limitation, the [New or Current] Bank, are each
set forth on Schedule A-1 hereto.
3. The parties hereto acknowledge and agree that, as of the Effective
Date (as defined below), (a) the percentage of the Aggregate Commitments
under the Credit Agreement of each Bank, including, without limitation, the
[New or Current] Bank, (b) the Commitment under the Credit Agreement of
each Bank, including, without limitation, the [New or Current] Bank, and
(c) the outstanding, balances of the Loans under the Credit Agreement made
by each Bank, including, without limitation, the [New or Current] Bank, are
each set forth on Schedule A-2 hereto.
4. Attached hereto is a revised Schedule 1.1 to the Credit Agreement,
revised to reflect the Commitment of each Bank as of the Effective Date of
this Bank Addition and Acknowledgement Agreement.
5. The [New or Current] Bank (1) represents and warrants that it is
legally authorized to enter into this Bank Addition and Acknowledgment
Agreement; (ii) confirms that it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 5.1(d) thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into this Bank Addition and Acknowledgement
Agreement; (iii) agrees that it will, independently and without reliance
upon any other Bank or the Agent and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit
Agreement; (iv) appoints and authorizes Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement and
the other Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto (v)
agrees that it will perform in accordance with their terms all the
obligations which by the terms of the Credit Agreement and the other Loan
Documents are required to be performed by it as a Bank; and (vi) agrees
that it keep confidential all the information with respect to any Borrower
furnished to it by any Borrower (other than information required or
requested to be disclosed by it pursuant to regulatory requirements or
legal process; information requested by and disclosed to its auditors,
accountants and attorneys, provided that the [New or Current] Bank shall
use its best efforts to have such Persons enter into a confidentiality
agreement with respect to such information; and information generally
available to the public or otherwise available to the [New or Current] Bank
on a nonconfidential basis).
6. The effective date for this Bank Addition and Acknowledgement
Agreement shall be (the "Effective Date"). Following the execution of this
Bank Addition and Acknowledgement Agreement, it will be delivered to the
Agent for the consent of the Agent and acceptance and recording in the
Register.
7. Upon such consents, acceptance and recording, from and after the
Effective Date, the [New or Current] Bank shall be a party to the Credit
Agreement and the other Loan Documents to which Banks are parties and to
the extent provided in this Bank Addition and Acknowledgement Agreement,
have the rights and obligations of a Bank under each such Loan Document.
8. Upon such consents, acceptance and recording, from and after the
Effective Date, the Agent shall make all payments in respect of the
interest assigned hereby (including payments of principal, interest, fees
and other amounts) to the [New or Current] Bank.
9. The representations and warranties of the Borrowers under the
Credit Agreement and the other Loan Documents are true and correct in all
material respects as of the date hereof, both before and after giving
effect to the Loan requested herein.
10. THIS BANK ADDITION AND ACKNOWLEDGEMENT AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
ILLINOIS,
WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
INVACARE CORPORATION
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE (DEUTSCHLAND) GmbH
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE AUSTRALIA PTY. LTD.
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE CANADA INC.
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE S.A.
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE (UK) LIMITED
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE INTERNATIONAL SARL
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
DOMUS HOMECARE AG
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
INVACARE HOLDINGS CV
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
SCANDINAVIAN MOBILITY INTERNATIONAL APS
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
[CURRENT BANK OR NEW BANK]
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
Acknowledge and Consented to:
JPMORGAN CHASE BANK, N.A., as Agent
By:
------------------------------------------
Print Name:
------------------------------------------
Title:
------------------------------------------
Schedule A-1
to
Bank Addition and Acknowledgement Agreement
Banks and Commitments
(as of the date hereof)
A. Commitment Percentage of Each Bank.
B. Commitment of Each Bank.
1. $
-------------------------- -----------------
2. $
-------------------------- -----------------
3. $
-------------------------- -----------------
4. [Other] $
-----------------
C. Outstanding Balance of the Loans of Each Bank.
1. $
-------------------------- -----------------
2. $
-------------------------- -----------------
3. $
-------------------------- -----------------
4. [Other] $
-----------------
Schedule A-2
to
Bank Addition and Acknowledgement Agreement
Banks and Commitments
(as of the Effective Date)
A. Commitment Percentage of Each Bank.
B. Commitment of Each Bank.
1. $
-------------------------- -----------------
2. $
-------------------------- -----------------
3. $
-------------------------- -----------------
4. [Other] $
-----------------
C. Outstanding Balance of the Loans of Each Bank.
1. $
-------------------------- -----------------
2. $
-------------------------- -----------------
3. $
-------------------------- -----------------
4. [Other] $
-----------------
4
EXHIBIT B
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the "Assignment and Assumption") is
dated as of the Effective Date set forth below and is entered into by and
between [Insert name of Assignor] (the "Assignor") and [Insert name of
Assignee] (the "Assignee"). Capitalized terms used but not defined herein
shall have the meanings given to them in the Credit Agreement identified
below (as amended, the "Credit Agreement"), receipt of a copy of which is
hereby acknowledged by the Assignee. The Standard Terms and Conditions set
forth in Annex 1 attached hereto are hereby agreed to and incorporated
herein by reference and made a part of this Assignment and Assumption as if
set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard
Terms and Conditions and the Credit Agreement, as of the Effective Date
inserted by the Agent as contemplated below (i) all of the Assignor's
rights and obligations in its capacity as a Bank under the Credit Agreement
and any other documents or instruments delivered pursuant thereto to the
extent related to the amount and percentage interest identified below of
all of such outstanding rights and obligations of the Assignor under the
respective facilities identified below (including any letters of credit,
guarantees, and swingline loans included in such facilities) and (ii) to
the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of the Assignor (in its
capacity as a Bank) against any Person, whether known or unknown, arising
under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed
thereby or in any way based on or related to any of the foregoing,
including contract claims, tort claims, malpractice claims, statutory
claims and all other claims at law or in equity related to the rights and
obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as the "Assigned Interest"). Such sale and
assignment is without recourse to the Assignor and, except as expressly
provided in this Assignment and Assumption, without representation or
warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________
[and is an Affiliate/Approved Fund of
[identify Bank]2]
3. Borrower(s):
Invacare Corporation and each
of the Borrowing Subsidiaries party to the
Credit Agreement referenced below
4. Agent: JPMorgan Chase Bank, N.A., as the
administrative agent under the Credit
Agreement
5. Credit Agreement: The Credit Agreement dated
as of January 14, 2005 among
Invacare
Corporation, the Borrowing Subsidiaries
parties thereto, the Banks parties thereto,
JPMorgan Chase Bank, N.A., as Agent, and the
other agents parties thereto.
6. Assigned Interest:
------------------------------ ----------------------------- ----------------------------- ---------------------------
Facility Assigned3 Aggregate Amount of Amount of Commitment/Loans Percentage Assigned of
Commitment/Loans for all Assigned Commitment/Loans4
Banks
------------------------------ ----------------------------- ----------------------------- ---------------------------
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
Effective Date: _____________ ___, 20___ [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:________________________
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:________________________
Title:
Consented to and Accepted:
JPMORGAN CHASE BANK, N.A., as
Agent
By_________________________________
Title:
Consented to:
INVACARE CORPORATION
By________________________________
Title:
ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim
and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any
other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Documents or
any collateral thereunder, (iii) the financial condition of any Borrower,
any of their respective Subsidiaries or Affiliates or any other Person
obligated in respect of any Loan Document or (iv) the performance or
observance by any Borrower, any of their respective Subsidiaries or
Affiliates or any other Person of any of their respective obligations under
any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Bank under the Credit
Agreement, (ii) it satisfies the requirements, if any, specified in the
Credit Agreement that are required to be satisfied by it in order to
acquire the Assigned Interest and become a Bank, (iii) from and after the
Effective Date, it shall be bound by the provisions of the Credit Agreement
as a Bank thereunder and, to the extent of the Assigned Interest, shall
have the obligations of a Bank thereunder, (iv) it has received a copy of
the Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.1(d) thereof, as applicable, and
such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it
has made such analysis and decision independently and without reliance on
the Agent or any other Bank, and (v) if it is a Foreign Bank, attached to
the Assignment and Assumption is any documentation required to be delivered
by it pursuant to the terms of the Credit Agreement, duly completed and
executed by the Assignee; and (b) agrees that (i) it will, independently
and without reliance on the Agent, the Assignor or any other 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 the Loan Documents, and (ii) it will perform in accordance
with their terms all of the obligations which by the terms of the Loan
Documents are required to be performed by it as a Bank.
2. Payments. From and after the Effective Date, the Agent shall make
all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts
which have accrued to but excluding the Effective Date and to the Assignee
for amounts which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in
any number of counterparts, which together shall constitute one instrument.
Delivery of an executed counterpart of a signature page of this Assignment
and Assumption by telecopy shall be effective as delivery of a manually
executed counterpart of this Assignment and Assumption. This Assignment and
Assumption shall be governed by, and construed in accordance with, the law
of the State of
Illinois.
EXHIBIT C
AGREEMENT
Reference is made to the Credit Agreement dated as of January 14, 2005
(as now or hereafter amended or modified from time to time, the "Credit
Agreement") among
INVACARE CORPORATION, an Ohio corporation (the
"Company"), certain borrowing subsidiaries designated therein from time to
time (the "Borrowing Subsidiaries"), the banks named therein (the "Banks"),
and JPMORGAN CHASE BANK, N.A., as administrative agent for the Banks (the
"Agent"). Terms defined in the Credit Agreement are used herein with the
same meaning.
1. __________________, a ___________ corporation (the "New Borrowing
Subsidiary") has decided to become a Borrowing Subsidiary under the Credit
Agreement, with its address for notice as described next to its signature
below. The New Borrowing Subsidiary (i) confirms that it has received a
copy of the Credit Agreement, together with copies of documents and
information as it has deemed appropriate to make its own decision to enter
into this Agreement; (ii) agrees that it will perform in accordance with
all of the obligations and comply with all of the covenants that by the
terms of the Credit Agreement and the other Loan Documents are required to
be performed by or complied with by it as a Borrowing Subsidiary; (iii)
confirms that the representations and warranties contained in Article IV of
the Credit Agreement and in any other Credit Agreement applicable to a
Borrowing Subsidiary are true and correct as of the date hereof as to the
New Borrowing Subsidiary and (iv) authorizes Invacare Corporation, as
Treasury Manager, to act as its manager under the Credit Agreement pursuant
to Section 2.12 of the Credit Agreement.
2. Upon execution and delivery of this Agreement to the Agent together
with all other items required pursuant to paragraph 3, the New Borrowing
Subsidiary shall be a party to the Credit Agreement and have the rights and
obligations of a Borrowing Subsidiary thereunder.
3. This Agreement shall not become effective and the New Borrowing
Subsidiary shall not become a Borrowing Subsidiary under the Credit
Agreement until receipt by the Agent of a certificate of incumbency of the
Company and the New Borrowing Subsidiary containing, and attesting to the
genuineness of, the signatures of those officers authorized to act on
behalf of the New Borrowing Subsidiary in connection with this Agreement,
the Credit Agreement and the other Loan Documents and on behalf of the
Company in connection with this Agreement and the consummation by the New
Borrowing Subsidiary and the Company of the transactions contemplated
herein, certified as true and correct as of the effective date of this
Agreement by a duly authorized officer of the New Borrowing Subsidiary and
the Company, respectively.
4. The Company (a) fully consents to the New Borrowing Subsidiary
becoming a Borrowing Subsidiary; (b) agrees that the Guaranty with respect
to the indebtedness, obligations and liabilities of the Borrowing
Subsidiaries dated as of January 14, 2005 in favor of the Agent and the
Banks is ratified and confirmed and shall remain in full force and effect;
and (c) confirms that all indebtedness, obligations and liabilities of the
Borrowing Subsidiaries, including the New Borrowing Subsidiary, are
guaranteed by the Guaranty.
5. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of
Illinois.
6. This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
7. Upon delivery of this executed Agreement to the Agent, the Agent
shall deliver a copy of this Agreement to each Bank.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officer thereunto duly authorized as
of the day and year first above written.
______________________ [NEW BORROWING SUBSIDIARY]
==============================
Attention: ___________________ By:______________________________________
Facsimile No. (___) ___-____
Its:____________________________________
INVACARE CORPORATION
By:_____________________________________
Its:___________________________________
JPMORGAN CHASE BANK, N.A., as Agent
By: _____________________________________
Its: __________________________________
EXHIBIT D
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of January 14, 2005 (this
"Guaranty") made by INVACARE CORPORATION, an Ohio corporation (the
"Guarantor"), in favor of the banks which are parties to the Credit
Agreement hereinafter defined (the "Banks"), and JPMORGAN CHASE BANK, N.A.,
a national banking association, as administrative agent (in such capacity,
the "Agent") for such Banks under the Credit Agreement.
W I T N E S S E T H:
A. The Guarantor and certain subsidiaries of the Guarantor set forth
on Schedule A hereto (the "Subsidiaries"), have entered into a Credit
Agreement, dated as of even date herewith (as amended or modified from time
to time, the "Credit Agreement") with the Agent and the Banks, pursuant to
which the Banks have agreed to make Advances to the Subsidiaries and, in
their sole discretion, other subsidiaries of the Guarantor (such
subsidiaries and the Subsidiaries being collectively referred to herein as
the "Borrowing Subsidiaries"), subject to the terms and conditions of the
Credit Agreement; and
B. As a condition to the obligation of the Banks under the Credit
Agreement, the Guarantor is required to fully and unconditionally
guarantee, among other things, the Advances and other obligations of the
Borrowing Subsidiaries;
NOW, THEREFORE, as an inducement to the Banks to enter into the
transactions contemplated by the Credit Agreement, the Guarantor agrees
with the Banks and the Agent as follows:
1. Guarantee of Obligations. The Guarantor hereby (i) guarantees, as
principal obligor and not as surety only, to the Banks the prompt payment
of the principal of and any and all accrued and unpaid interest (including
interest which otherwise may cease to accrue by operation of any insolvency
law, rule, regulation or interpretation thereof) on (x) the Advances made
to any of the Borrowing Subsidiaries, (y) reimbursement of all amounts due
to the Banks upon issuance of letters of credit for the benefit of any of
the Borrowing Subsidiaries, and (z) all other loans or advances by any Bank
to any of the Borrowing Subsidiaries, or other obligations of any of the
Borrowing Subsidiaries to the Agent and the Banks, including without
limitation foreign exchange loans and advances which are not made pursuant
to the terms of the Credit Agreement, all when due, whether by scheduled
maturity, acceleration or otherwise, all in accordance with the terms of
the Credit Agreement or such other documents or instruments evidencing such
loans, advances or obligations (the "Other Loan Documents"), and any and
all other amounts which may be payable by any of the Borrowing Subsidiaries
to any Bank or the Agent in connection with or pursuant to the Credit
Agreement and the Other Loan Documents, including, without limitation,
default interest, indemnification payments and all reasonable costs and
expenses incurred by the Banks and the Agent in connection with enforcing
any obligations of the Borrowing Subsidiaries thereunder, including without
limitation the reasonable fees and disbursements of counsel, (ii)
guarantees the prompt and punctual performance and observance of each and
every term, covenant or agreement contained in the Credit Agreement and the
Other Loan Documents to be performed or observed on the part of any of the
Borrowing Subsidiaries, and (iii) agrees to make prompt payment, on demand,
of any and all reasonable costs and expenses incurred by the Banks or the
Agent in connection with enforcing the obligations of the Guarantor
hereunder, including, without limitation, the reasonable fees and
disbursements of counsel (all of the foregoing being collectively referred
to as the "Guaranteed Obligations", and the Credit Agreement and the Other
Loan Documents are sometimes collectively referred to as the "Credit
Agreements").
(a) If for any reason any duty, agreement or obligation of any of
the Borrowing Subsidiaries contained in the Credit Agreements shall
not be performed or observed by the relevant Borrowing Subsidiary as
provided therein, or if any amount payable under or in connection with
the Credit Agreements shall not be paid in full when the same becomes
due and payable, the Guarantor undertakes to perform or cause to be
performed promptly each of such duties, agreements and obligations and
to pay forthwith each such amount to the Agent for the account of the
Banks regardless of any defense or setoff or counterclaim which any of
the Borrowing Subsidiaries may have or assert, and regardless of any
other condition or contingency.
(b) The date and amount of advances of principal made by the
Banks in respect of the Loans made to the Borrowing Subsidiaries and
the aggregate principal amount thereof and accrued interest thereon
shown upon the books and records of each respective Bank and in any
certificate delivered by any Bank to the Guarantor in respect thereof,
shall be prima facie evidence of the principal amount and accrued
interest owing and unpaid on such Loans. The failure to record any
such information on such books and records shall not, however, limit
or otherwise affect the obligations of any of the Borrowing
Subsidiaries to repay the principal amount of such Loans together with
accrued interest thereon or the obligations of the Guarantor hereunder
with respect thereto.
2. Nature of Guaranty. This Guaranty is an absolute and unconditional
and irrevocable guaranty of payment and not a guaranty of collection and is
wholly independent of and in addition to other rights and remedies of the
Banks and the Agent and is not contingent upon the pursuit by the Banks and
the Agent of any such rights and remedies, such pursuit being hereby waived
by the Guarantor.
3. Waivers and Other Agreements. The Guarantor hereby unconditionally
(a) waives any requirement that the Banks or the Agent, upon the occurrence
of an "Event of Default" (as defined in the Credit Agreement) or an event
of default under any of the Other Loan Documents by any of the Borrowing
Subsidiaries, first make demand upon, or seek to enforce remedies against,
any or all of the Borrowing Subsidiaries before demanding payment under or
seeking to enforce this Guaranty, (b) covenants that this Guaranty will not
be discharged except by complete performance of all obligations of the
Borrowing Subsidiaries contained in the Credit Agreements, (c) agrees that
this Guaranty shall remain in full force and effect without regard to, and
shall not be affected or impaired, without limitation, by any invalidity,
irregularity or unenforceability in whole or in part of the Credit
Agreements, or any limitation on the liability of any of the Borrowing
Subsidiaries thereunder, or any limitation on the method or terms of
payment thereunder which may now or hereafter be caused or imposed in any
manner whatsoever, (d) waives diligence, presentment and protest with
respect to, and any notice of default or dishonor in the payment of any
amount at any time payable by any of the Borrowing Subsidiaries under or in
connection with the Credit Agreements, and further waives any requirement
of notice of acceptance of, or other formality relating to, this Guaranty
and (e) agrees that the Guaranteed Obligations shall include any amounts
paid by any of the Borrowing Subsidiaries to any Bank or the Agent which
may be required to be returned to any of the Borrowing Subsidiaries, or to
its representative or to a trustee, custodian or receiver for any of the
Borrowing Subsidiaries.
4. Obligations Absolute. The obligations, covenants, agreements and
duties of the Guarantor under this Guaranty shall not be released, affected
or impaired by any of the following whether or not undertaken with notice
to or consent of the Guarantor: (a) any assignment or transfer, in whole or
in part, of the Loans made to the Borrowing Subsidiaries or the Credit
Agreements although made without notice to or consent of the Guarantor, or
(b) any waiver by any Bank or the Agent, or by any other person, of the
performance or observance by any of the Borrowing Subsidiaries of any of
the agreements, covenants, terms or conditions contained in the Credit
Agreements, or (c) any indulgence in or the extension of the time for
payment by any of the Borrowing Subsidiaries of any amounts payable under
or in connection with the Credit Agreements, or of the time for performance
by any of the Borrowing Subsidiaries of any other obligations under or
arising out of the Credit Agreements, or the extension or renewal thereof,
or (d) the modification, amendment or waiver (whether material or
otherwise) of any duty, agreement or obligation of any of the Borrowing
Subsidiaries set forth in the Credit Agreements (the modification,
amendment or waiver from time to time of the Credit Agreements being
expressly authorized without further notice to or consent of the
Guarantor), or (e) the voluntary or involuntary liquidation, sale or other
disposition of all or substantially all of the assets of any of the
Borrowing Subsidiaries, or any receivership, insolvency, bankruptcy,
reorganization, or other similar proceedings, affecting any of the
Borrowing Subsidiaries or any of their assets, or (f) the merger or
consolidation of any of the Borrowing Subsidiaries or the Guarantor with
any other person, or (g) the release or discharge of any of the Borrowing
Subsidiaries or the Guarantor from the performance or observance of any
agreement, covenant, term or condition contained in the Credit Agreements,
by operation of law, or (h) any other cause whether similar or dissimilar
to the foregoing which would release, affect or impair the obligations,
covenants, agreements or duties of the Guarantor hereunder.
5. Foreign Currency. This Guaranty arises in the context of an
international transaction, and the specification of payment in foreign
currency to the Agent and the Banks pursuant to the Credit Agreement is of
the essence. The foreign currency shall be the currency of account and
payment under the Credit Agreements. The obligation of the Guarantor shall
not be discharged by an amount paid in any other currency or at another
place, whether pursuant to a judgment or otherwise, to the extent that the
amount so paid, on prompt conversion into the foreign currency and transfer
to the Agent and the Banks under normal banking procedure, does not yield
the amount of foreign currency due under this Guaranty. In the event that
any payment, whether pursuant to a judgment or otherwise, upon conversion
and transfer, does not result in payment of the amount of foreign currency
due under this Guaranty, the Agent and the Banks shall have an independent
cause of action against the Guarantor for the foreign currency deficiency.
6. Events of Default. The occurrence of any "Event of Default" (as
defined in the Credit Agreement) shall be deemed an "event of default"
hereunder unless waived by the Banks pursuant to paragraph 8.
7. Remedies. Upon the occurrence and during the continuance of such
event of default, the Agent may, and upon being directed to do so by the
Required Banks, shall enforce its rights either by suit in equity, or by
action at law, or by other appropriate proceedings, whether for the
specific performance (to the extent permitted by law) of any covenant or
agreement contained in this Guaranty or in aid of the exercise of any power
granted in this Guaranty and may enforce payment under this Guaranty and
any of its other rights available at law or in equity.
8. Amendments, Etc. This Guaranty may be amended from time to time and
any provision hereof may be waived in accordance with the requirements of
Section 8.1 of the Credit Agreement. No amendment or waiver of any
provision of this Guaranty nor consent to any departure by the Guarantor
therefrom shall be effective unless the same shall be in writing and signed
by the Required Banks or all of the Banks, as the case may be, and, to the
extent any rights or duties of the Agent may be affected, the Agent, and
then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
9. Notices. All notices and other communications hereunder shall be in
writing and made in accordance with Section 8.2 of the Credit Agreement.
10. Conduct No Waiver; Remedies Cumulative. The obligations of the
Guarantor under this Guaranty are continuing obligations and a fresh cause
of action shall arise in respect of each event of default hereunder. No
course of dealing on the part of any Bank or the Agent, nor any delay or
failure on the part of any Bank or the Agent in exercising any right, power
or privilege hereunder shall operate as a waiver of such right, power or
privilege or otherwise prejudice any Bank or the Agent's rights and
remedies hereunder; nor shall any single or partial exercise thereof
preclude any further exercise thereof or the exercise of any other right,
power or privilege. No right or remedy conferred upon or reserved to the
Banks or the Agent under this Guaranty is intended to be exclusive of any
other right or remedy, and every right and remedy shall be cumulative and
in addition to every other right or remedy given hereunder or now or
hereafter existing under any applicable law. Every right and remedy given
by this Guaranty or by applicable law to the Banks or the Agent may be
exercised from time to time and as often as may be deemed expedient by
them.
11. Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of the Guarantor made
herein or in any certificate or other document delivered pursuant hereto
shall be deemed to be material and to have been relied upon by the Banks or
the Agent, notwithstanding any investigation heretofore or hereafter made
by the Banks or the Agent or on their behalf.
12. No Investigation by the Banks or the Agent. The Guarantor hereby
waives unconditionally any obligation which, in the absence of such
provision, the Banks or the Agent might otherwise have to investigate or to
assure that there has been compliance with the law of any jurisdiction with
respect to the Guaranteed Obligations recognizing that, to save both time
and expense, the Guarantor has requested that the Banks and the Agent not
undertake such investigation. The Guarantor hereby expressly confirms that
the obligations of the Guarantor hereunder shall remain in full force and
effect without regard to compliance or noncompliance with any such law and
irrespective of any investigation or knowledge of any Bank or the Agent of
any such law.
13. Governing Law. This Guaranty is a contract made under, and the
rights and obligations of the parties hereunder, shall be governed by and
construed in accordance with, the laws of the State of
Illinois applicable
to contracts to be made and to be performed entirely with such State
without regard to the choice of law principles of such State.
14. Headings. The headings of the various subdivisions hereof are for
convenience of reference only and shall in no way modify any of its terms
or provisions hereof.
15. Construction of Certain Provisions. If any provision of this
Guaranty refers to any action to be taken by any person, or which such
person is prohibited from taking, such provision shall be applicable
whether such action is taken directly or indirectly by such person, whether
or not expressly specified in such provision.
16. Integration and Severability. This Guaranty embodies the entire
agreement and understanding between the Guarantor, the Banks and the Agent,
and supersedes all prior all agreements and understandings, relating to the
subject matter hereof. In any case one or more of the obligations of the
Guarantor under this Guaranty shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the
remaining obligations of the Guarantor shall not in any way be affected or
impaired thereby, and such invalidity, illegality or unenforceability in
one jurisdiction shall not affect the validity, legality or enforceability
of the obligations of the Guarantor under this Guaranty in any other
jurisdiction.
17. Indemnity. As a separate, additional and continuing obligation,
the Guarantor unconditionally and irrevocably undertakes and agrees with
the Banks and the Agent that, should the Guaranteed Obligations not be
recoverable from the Guarantor under paragraph 1 for any reason whatsoever
(including, without limitation, by reason of any provision of the Credit
Agreement or any other agreement or instrument executed in connection
therewith being or becoming void, unenforceable, or otherwise invalid under
any applicable law) then, notwithstanding any knowledge thereof by any Bank
or the Agent at any time, the Guarantor as sole, original and independent
obligor, upon demand by the Agent, will make payment to the Agent for the
account of the Banks and the Agent of the Guaranteed Obligations by way of
a full indemnity in such currency and otherwise in such manner as is
provided in the Credit Agreement or such other agreement or instrument, as
the case may be.
18. Subordination, Subrogation, Etc. The Guarantor agrees that any
present or future indebtedness, obligations or liabilities of any Borrowing
Subsidiary to the Guarantor shall be fully subordinate and junior in right
and priority of payment to any present or future indebtedness, obligations
or liabilities of any Borrowing Subsidiary to the Banks and the Agent, and
the Guarantor shall not exercise any right of subrogation, reimbursement or
indemnity whatsoever nor any right of recourse to security for the debts
and obligations of any Borrowing Subsidiary, until all of the Guaranteed
Obligations have been paid in full and are not subject to any right of
revocation or rescission.
19. Jurisdiction and Venue. The Guarantor agrees that any legal action
or proceeding with respect to this Guaranty or the Credit Agreement or the
transactions contemplated thereby may be brought only in any court in the
State of
Illinois, or any court of the United States of America sitting in
the State of
Illinois, and the Guarantor hereby submits to and accepts
generally and unconditionally the jurisdiction of those courts with respect
to its person and property, and irrevocably consents to the service of
process in connection with any such action or proceeding by personal
delivery to the Guarantor or by mailing thereof by registered or certified
mail, postage prepaid, to the Guarantor at its address as provided by it
from time to time under the Credit Agreements. Nothing in this paragraph
shall affect the right of the Agent or any Bank to serve process in any
other manner permitted by law or limit the right of the Agent or any Bank
to bring any such action or proceeding against the Guarantor or its
property in the courts of any other jurisdiction. The Guarantor hereby
irrevocably waives any objection to the laying of venue of any such suit or
proceeding in the above-described courts.
20. Waiver of Jury Trial. The Agent, the Banks and the Guarantor,
after consulting or having had the opportunity to consult with counsel,
knowingly, voluntarily and intentionally waive any right any of them may
have to a trial by jury in any litigation based upon or arising out of this
Guaranty or any related instrument or agreement or any of the transactions
contemplated by this Guaranty. Neither the Agent, any Bank nor the
Guarantor shall seek to consolidate, by counterclaim or otherwise, any such
action in which a jury trial has been waived with any other action in which
a jury trial cannot be or has not been waived. These provisions shall not
be deemed to have been modified in any respect or relinquished by the
Agent, any Bank or the Guarantor except by a written instrument executed by
all of them.
21. Inapplicability of Surety Provisions. The parties hereby agree
that the Guarantor is not a surety within the meaning of Section 1341.03 of
the Ohio Revised Code.
22. No Setoff or Deduction.
(a) All payments by the Guarantor of any Guaranteed Obligations made
hereunder shall be made free and clear of any present or future taxes or
withholdings and without any set-off or counter claim or any restriction or
condition or deduction whatsoever. The Guarantor shall indemnify the Agent
and each Bank against any taxes or charges (other than taxes imposed on net
overall income of the Bank or the Agent, by the jurisdiction, or by any
political subdivision or taxing authority of any such jurisdiction, in
which any Bank or the Agent, as the case may be, has its principal office)
which may be claimed from it in respect of the Advances or any of them or
any sum payable by the Guarantor hereunder and against any costs, charges
and expenses or liabilities in respect of such claim and such indemnity
shall survive the termination of the Commitments.
(b) If at any time the Guarantor is required by law or by any
directive or order of any court of competent jurisdiction to make any
deduction or withholding of whatsoever nature from any payment due under
this Guaranty, the Guarantor will ensure that the same does not exceed the
minimum liability therefor and will (a) pay to any Bank on request such
additional amount as such Bank certifies will result in the net amount
received by it after all deductions being equal to the full amount which
would have been receivable had there been no deduction or withholding and
(b) pay forthwith to the relevant authorities the full amount of the
deduction or withholding and deliver to the Agent such an official receipt,
certificate or other proof evidencing the amount paid in respect of such
deduction or withholding. Any additional amount paid under this sub-clause
shall not be treated as interest but as agreed compensation.
(c) If any payment by the Guarantor is made to or for the account of
any Bank after deduction for or on account of tax, and additional payments
are made by the Guarantor then, if any Bank shall receive or be granted a
credit against or remission for such tax, such Bank shall, to the extent
that it can do so without prejudice to the retention of the amount of such
credit or remission, reimburse to the Guarantor such amount as such Bank
shall, in its absolute opinion, have concluded to be attributable to the
relevant tax or deduction or withholding; provided, that the Guarantor,
upon the request of such Bank, agrees to repay the amount paid over to the
Guarantor (plus any penalties, interest or other charges imposed by the
relevant governmental entity) to such Bank in the event such Bank is
required to repay any such credit, refund or other amount to such
governmental entity. Nothing herein contained shall interfere with the
right of any Bank to arrange its affairs in whatever manner it thinks fit
and, in particular, the Banks shall not be under any obligation to claim
relief from its corporation profits or similar tax liability in respect of
such tax in priority to any other claims, reliefs, credits or deductions
available to it nor oblige any Bank to disclose any information relating to
its tax affairs. Such reimbursement shall be made as soon as reasonably
practical upon such Bank certifying that the amount of such credit or
remission has been received by it.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed and delivered as of this 14th day of January, 2005.
INVACARE CORPORATION
By: __________________________________
Its: _________________________________
The undersigned hereby executes this Guaranty for the purpose of
accepting it and agreeing to paragraph 20 hereof.
JPMORGAN CHASE BANK, N.A., as Agent
By: ____________________________
Its: ___________________________
Dated: January 14, 2005
EXHIBIT E
BID-OPTION QUOTE REQUEST
[Date]
JPMorgan Chase Bank, N.A., as Agent for the Banks
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Invacare Corporation (the "Treasury Manager") on behalf of the
Borrowers referred to below, hereby requests offers to make Bid-Option
Loans comprising the Bid-Option Borrowing(s) described below pursuant to
Section 2.2(b) of the Credit Agreement, dated as of January 14, 2005, as
amended, supplemented or otherwise modified (the "Credit Agreement"), by
and among INVACARE CORPORATION, an Ohio corporation (the "Company"),
certain Borrowing Subsidiaries designated therein from time to time
(collectively with the Company, the "Borrowers"), the Banks, and JPMORGAN
CHASE BANK, N.A., as administrative agent. Capitalized terms used but not
defined herein shall have the respective meanings ascribed thereto in the
Credit Agreement.
Date of Bid-Option Borrowing(s): ________, 200_
Designated Borrower: _____________________
Aggregate Amount of each Bid-Option Borrowing: (a) _______________*
(b) ______________
(c) ______________
Interest Period: (a) ______________**
(b) ______________
(c) ______________
INVACARE CORPORATION
By:________________________
Its:_______________________
*Must be (a) $5,000,000 or a larger multiple of $1,000,000.
**Must comply with the definition of the term "Bid-Option Interest Period."
EXHIBIT F
INVITATION FOR BID-OPTION QUOTES
[Date]
To: [Name of Bank]
Attention: ____________________
Reference is made to the Credit Agreement, dated as of January 14,
2005, as amended, supplemented or otherwise modified (the "Credit
Agreement"), by and among INVACARE CORPORATION, an Ohio corporation (the
"Company") certain Borrowing Subsidiaries designated therein from time to
time (collectively with the Company, the "Borrowers"), the Banks, and
JPMORGAN CHASE BANK, N.A., as administrative agent (the "Agent").
Capitalized terms used but not defined herein shall have the respective
meanings ascribed thereto in the Credit Agreement.
Pursuant to Section 2.2(c) of the Credit Agreement, JPMorgan Chase
Bank, N.A., as Agent, is pleased on behalf of the Borrowers to invite you
to submit Bid-Option Quotes to the Borrowers for the Bid-Option
Borrowing(s) described below.
Date of Bid-Option Borrowing(s): ________, 200_
Designated Borrower: ____________________
Aggregate Amount of Each
Bid-Option Borrowing: Interest Period:
(a) ____________________ (a) ________________
(b) ____________________ (b) ________________
(c) ____________________ (c) ________________
Please respond to this invitation by no later than 9:00 a.m. (Detroit
time) on _________________, 200_.*
JPMORGAN CHASE BANK, N.A., as Agent
By: _______________________________
Its: ______________________________
* Insert date of Bid-Option Borrowing
EXHIBIT G
BID-OPTION QUOTE
[Date]
JPMorgan Chase Bank, N.A., as Agent for the Banks
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Reference is made to the Credit Agreement, dated as of January 14,
2005, as amended, supplemented or otherwise modified (the "Credit
Agreement"), by and among INVACARE CORPORATION, an Ohio corporation (the
"Company"), certain Borrowing Subsidiaries designated therein from time to
time (collectively with the Company, the "Borrowers"), the Banks, and
JPMORGAN CHASE BANK, N.A., as administrative agent (the "Agent").
Capitalized terms used but not defined herein shall have the respective
meanings ascribed thereto in the Credit Agreement.
In response to your Invitation for Bid-Option Quotes dated _____,
200_, _________________________ (the "Bank"), hereby makes the following
offer[s] to make [a] Bid-Option Loan[s]:
1. Quoting Bank: ____________________________
Contact Person: _________________________
2. Date of proposed Borrowing: __________, 200_*
3. Quotes:
Principal Bid-Option Interest
Amount** Rate*** Period ****
(a) _________ ___________ ___________
(b) _________ ___________ ___________
(c) _________ ___________ ___________
4. The aggregate amount of Bid-Option Loans which may be accepted by
the Borrowers pursuant to this Bid-Option Quote shall not exceed
$_____________.
The Bank acknowledges and agrees that this Bid-Option Quote (a) is
irrevocable and (b), subject to the terms and conditions of the Credit
Agreement, obligates it to make a Bid-Option Loan for which any quote is
accepted, in whole or in part.
[Name of Bank]
By: _____________________________________
Its: ____________________________________
* As specified in the related Invitation for Bid-Option Quotes.
** The principal amount (a) must be $5,000,000 or a larger multiple of
$1,000,000 and (b) may not exceed the aggregate amount of the related
Bid-Option Borrowing specified in the related Invitation for Bid-Option
Quotes.
*** Specify rate of interest per annum (rounded up to the nearest 1/100th
of 1%) or applicable margin, which may be positive or negative,
expressed as a percentage (rounded up to the nearest 1/100th of 1%), as
the case may be.
**** As specified in the related Invitation for Bid-Option Quotes.
EXHIBIT H
REQUEST FOR REVOLVING CREDIT ADVANCE
To each Bank party to
the referenced Credit Agreement
c/o JPMorgan Chase Bank, N.A., as Agent for the Banks
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Invacare Corporation, (the "Treasury Manager"), on behalf of the
Borrowers referred to below, hereby requests a [insert Revolving Credit
Loan or Letter of Credit Advance] pursuant to Section 2.6 of the Credit
Agreement, dated as of January 14, 2005 (as amended or modified from time
to time, the "Credit Agreement"), among Invacare Corporation, an Ohio
corporation (the "Company"), the Borrowing Subsidiaries designated from
time to time (collectively with the Company, the "Borrowers"), the Banks
referenced therein, you, as administrative agent (the "Agent") for the
Banks.
[A Revolving Credit Loan is requested to be made in the amount of
_________ (specify amount of Dollars or the relevant Permitted Currency),
to be made on ____________, 200_ for the account of ____________ (specify
Designated Borrower). Such Loan shall be a [insert Eurocurrency Rate
Revolving Credit Loan, or Floating Rate Loan] and the initial Interest
Period, if such requested Loan is a Eurocurrency Rate Revolving Credit
Loan, shall be [insert permitted Interest Period].]
[Such Letter of Credit Advance shall be made by the issuance by the
Agent of its Letter of Credit for the account of ____________ (specify
Designated Borrower) in the maximum stated amount of $___________ to and
for the benefit of ________________ with a stated expiry date of
_________________, 200_, and containing the further terms and conditions
set forth in the attached letter of credit application to the Agent.]
In support of this request, the Treasury Manager, on behalf of the
Borrowers, hereby represents and warrants to the Agent and the Banks that:
1. The representations and warranties contained in Article IV of the
Credit Agreement are true and correct in all material respects on and as of
the date hereof, and will be true and correct in all material respects on
the date such Advance is made (both before and after such Advance is made),
as if such representations and warranties were made on and as of such
dates.
2. No Event of Default or Default has occurred and is continuing or
will exist on the date such Advance is made and such Advance shall not
cause an Event of Default or Default.
Acceptance of the proceeds of such Advance by the Designated Borrower
shall be deemed to be a further representation and warranty by the
Borrowers that the representations and warranties made herein are true and
correct in all material respects at the time such proceeds are disbursed.
Capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Credit Agreement.
INVACARE CORPORATION
By: _____________________________________
Its: ____________________________________
Dated: ________________, 200_
EXHIBIT I
LEGAL OPINION
January 14, 2005
To each Bank party to the referenced
Credit Agreement
c/o JPMorgan Chase Bank, N.A., as Agent for the Banks
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We refer to the Credit Agreement dated as of January 14, 2005 (the
"Credit Agreement") by and among Invacare Corporation, an Ohio corporation
(the "Company"), certain subsidiaries designated therein (the "Borrowing
Subsidiaries" and collectively with the Company, the "Borrowers"), the
banks parties thereto (the "Banks"), and JPMorgan Chase Bank, N.A., as
administrative agent for the Banks (in such capacity, the "Agent"). We have
been requested by the Company and the Borrowing Subsidiaries listed on
Schedule A attached hereto (the "Domestic Borrowing Subsidiaries") to give
our opinion pursuant to Section 2.7(e) of the Credit Agreement and, for
purposes of this opinion, the terms used in this opinion, which are not
defined herein, shall have the respective meanings set forth in the Credit
Agreement.
We have examined the following documents and instruments: (i) the
Credit Agreement, (ii) the Guaranty, and (iii) other documents relating to
the transactions contemplated by the Credit Agreement (collectively, items
(i) through (iii) are referred to as the "Loan Documents"). We have also
examined and relied upon certified copies of the Company's and each
Domestic Borrowing Subsidiary's articles of incorporation, by-laws and
board of directors resolutions authorizing the Company's and each Domestic
Borrowing Subsidiary's participation in the transactions contemplated by
the Credit Agreement. We have also copies of all such documents and records
of the Company and the Domestic Borrowing Subsidiaries and all such other
documents and records, and have made such investigations of law, as we have
deemed necessary and relevant as a basis for our opinion. With respect to
material factual matters not independently established by us, we have
relied upon certificates of officers of the Company and the Domestic
Borrowing Subsidiaries, which reliance we deemed appropriate in the
circumstances.
Based upon the foregoing, it is our opinion that:
1. Each of the Company and each Domestic Borrowing Subsidiary is a
corporation duly organized, validly existing and in good standing under the
laws of the state of its respective organization or incorporation, and each
is duly qualified to do business, and is in good standing, in all
additional jurisdictions where such qualification is necessary under
applicable law, except where the failure to so qualify to be so would not
have a material adverse effect on the business and financial condition of
the Company and its Subsidiaries taken as a whole. Each of the Company and
each Domestic Borrowing Subsidiary has all requisite corporate power to own
or lease the properties used in its business and to carry on its business
as now being conducted. The Company and each Domestic Borrowing Subsidiary
has all requisite corporate power to execute and deliver the Loan Documents
to which it is a party and to engage in the transactions contemplated by
the Loan Documents.
2. The execution, delivery and performance by the Company and each
Domestic Borrowing Subsidiary of the Loan Documents have been duly
authorized by all necessary corporate action and are not in contravention
of any law, rule or regulation, or any judgment, decree, writ, injunction,
order or award of any arbitrator, court or governmental authority, or of
the terms of the Company's or any Domestic Borrowing Subsidiary's charter
or by-laws, or of any material contract or undertaking to which the Company
or any Domestic Borrowing Subsidiary is a party or by which the Company or
any Domestic Borrowing Subsidiary or any of their respective property may
be bound or affected, and will not result in the imposition of any Lien
except for Permitted Liens.
3. The Loan Documents to which the Company or any Domestic Borrowing
Subsidiary is a party are the legal, valid and binding obligations of the
Company and each Domestic Borrowing Subsidiary enforceable against the
Company and each Domestic Borrowing Subsidiary in accordance with their
respective terms.
4. Schedule 4.4 of the Credit Agreement correctly sets forth the
corporate name, jurisdiction of incorporation and ownership of each
Subsidiary of the Company.
5. To the best of our knowledge and except as set forth in Schedule
4.5 of the Credit Agreement, there is no action, suit or proceeding pending
or threatened against or affecting the Company or any of its Subsidiaries
before or by any court, governmental authority or arbitrator, which if
adversely decided might result, either individually or collectively, in any
material adverse change in the business, properties, operations or
financial condition of the Company or any of its Subsidiaries taken as a
whole or in any material adverse effect on the legality, validity or
enforceability of any Credit Agreement and, to the best of the Company's
knowledge, there is no basis for any such action, suit or proceeding.
6. No consent, approval or authorization of or declaration,
registration or filing with any governmental authority or any
nongovernmental person or entity, including without limitation any
creditor, lessor or stockholder of the Company or any of its Subsidiaries,
is required on the part of the Company or any Subsidiary in connection with
the execution, delivery and performance of the Loan Documents or the
transactions contemplated thereby or as a condition to the legality,
validity or enforceability of the Loan Documents, except where the failure
to obtain such consents, approvals, authorizations, declarations,
registrations or filings would not have a material adverse effect on the
Company and its Subsidiaries, taken as a whole.
This opinion is subject to the qualifications that the enforcement of
the rights and remedies set forth in the Loan Documents are subject to the
effect of applicable bankruptcy, insolvency and other similar laws
affecting the enforcement of creditors' rights generally, and general
principles of equity, whether applied in a proceeding at law or in equity.
Very truly yours,
EXHIBIT J
COMPLIANCE CERTIFICATE
To: The Banks party to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain
Credit Agreement dated as of January 14, 2005 (as amended, modified,
renewed or extended from time to time, the "Credit Agreement") among
Invacare Corporation (the "Company"), the other Borrowers designated
therein from time to time, the banks party thereto and JPMorgan Chase Bank,
N.A., as Agent for the Banks. Unless otherwise defined herein, capitalized
terms used in this Compliance Certificate have the meanings ascribed
thereto in the Credit Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected Chief Financial Officer of the Company;
2. I have reviewed the terms of the Credit Agreement and I have made,
or have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company and its Subsidiaries during the
accounting period covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which
constitutes a Default or Event Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Company's compliance with certain covenants of
the Credit Agreement, all of which data and computations are true, complete
and correct.
The foregoing certifications, together with the computations set forth
in Schedule I and the financial statements delivered with this Certificate
in support hereof, are made and delivered this _____ day of _____________,
200__.
INVACARE CORPORATION
By:
------------------------------------
Chief Financial Officer
Invacare Corporation
Covenant Compliance Certificate
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5.2 (a) 1. Interest Coverage Ratio
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2. Calculation of EBIT
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i Net Income in current period
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ii Interest Expense in current period
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iii Taxes in current period
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iv The amount of any one-time charge taken as a result of the
cumulative effect from changes to GAAP after the Effective Date
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v EBIT in current period (sum of i through iv)
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3. Four Quarter Calculation of EBIT
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vi EBIT from preceding fiscal quarter
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vii EBIT from second preceding fiscal quarter
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viii EBIT from third preceding fiscal quarter
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ix EBIT for last four quarters (sum of v through viii)
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4. Four Quarter Calculation of Interest Expense
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x Interest Expense in current period (ii above)
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xi Interest Expense in preceding fiscal quarter
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xii Interest Expense in second preceding fiscal quarter
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xiii Interest Expense in third preceding fiscal quarter
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xiv Interest Expense for last four quarters (x through xiii)
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xv Interest Coverage Ratio (ix divided by xiv)
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xvi Minimum Interest Coverage Ratio required 3.0 to 1.0
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Compliance (line xv greater than line xvi) Y / N
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(circle)
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5.2 (b) 5. Net Worth
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6. Calculation of Net Worth
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i consolidated net worth from financial statements
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ii comprehensive earnings (positive or negative)
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iii Net Worth as defined in Credit Agreement (i minus ii)
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7.
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iv Required Net Worth from prior certificate (line 5.2 (b) x)
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v Net Income at Fiscal Year End (if less than $0 enter $0)
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vi Net Worth increase factor 50%
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vii Current Period increase from net income (v multiplied by vi)
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viii Required Net Worth this period (iv plus vii)
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ix Net Worth (line iii)
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x Minimum Net Worth Required (line viii)
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Compliance (line ix greater than line x)? Y / N
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(circle)
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5.2 (c) 8. Total Debt to Adjusted EBITDA
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9. Calculation of Adjusted EBITDA
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i EBIT in current period (line 5.2 (a) v above)
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ii Depreciation and amortization expense in current period
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iii Extraordinary, unusual or non-recurring gains (enter as positive)
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iv Extraordinary, unusual or non-recurring non-cash losses (enter
as negative)
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v 10. Current period Adjusted EBITDA (i plus ii minus iii
minus iv)
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vi EBITDA from preceding fiscal quarter
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vii EBITDA from second preceding fiscal quarter
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viii EBITDA from third preceding fiscal quarter
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ix Proforma EBITDA from acquisitions not included in i through viii
above (see attached schedule)
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x Adjusted EBITDA for last four quarters (sum of v through viii)
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11. Total Debt Calculation
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xi Debt for borrowed money
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xii Liabilities secured by any Lien
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xiii Outstanding letters of credit
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xiv Outstanding amount under Trade Receivables Securitization
Transactions
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xv Contingent Liabilities related to xi through xiv as required by
clause (e) of the definition of Contingent Liabilities
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xvi Total Debt in current period (sum of xi through xv)
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xvii Total Debt to Adjusted EBITDA (xvi divided by x)
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xviii Maximum Total Debt to Adjusted EBITDA permitted 3.50 to 1.0
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Compliance (line xvii less than line xviii)? Y / N
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(circle)
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5.2 (d) 12. Liens
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Compliance with 5.2 (d), including subsections (i) through (ix)? Y / N
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(circle)
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5.2 (e) 13. Merger; Etc.
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Compliance with 5.2 (e)? Y / N
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(circle)
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5.2 (f) 14. Disposition of Assets; Etc.
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Compliance with 5.2 (f), including subsections (i) and (ii)? Y / N
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(circle)
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5.2 (g) 15. Nature of Business
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Compliance with 5.2 (g)? Y / N
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(circle)
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5.2 (h) 16. Limitation on Indebtedness of Subsidiaries
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Compliance with 5.2 (h), including subsections (i) and (ii)? Y / N
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(circle)
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5.2 (i) 17. Investments
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Compliance with 5.2 (i), including subsections (i) through (xi)? Y / N
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(circle)
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5.2 (j) 18. Transactions with Affiliates
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Compliance with 5.2 (j)? Y / N
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(circle)
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5.2 (k) 19. Additional Covenants
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Compliance with 5.2 (k)? Y / N
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(circle)
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5.2 (l) 20. Acquisitions
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Compliance with 5.2 (l)? Y / N
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(circle)
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EXHIBIT K
REQUEST FOR CONTINUATION OR
CONVERSION OF REVOLVING CREDIT LOAN
[Date]
To each Bank party to
the referenced Credit Agreement
c/o JPMorgan Chase Bank, N.A., as Agent for the Banks
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Invacare Corporation, (the "Treasury Manager") on behalf of the
Borrowers referred to below, hereby requests that ____________ (specify
amount of Dollars or relevant Permitted Currency) of the principal amount
of the Revolving Credit Loan originally made on ____________, 200_, which
Revolving Credit Loan is currently a [insert type of Loan], be continued as
or converted to, as the case may be, a [insert type of Loan requested]
denominated in _____________ (specify Dollars or relevant Permitted
Currency) on ______________, 200_. If such Loan is requested to be
converted to a Eurocurrency Rate Revolving Credit Loan, the Borrower hereby
elects an Interest Period for such Loan of [insert permitted Interest
Period].
In support of this request, the Treasury Manager, on behalf of the
Borrowers, hereby represents and warrants to the Agent and the Banks that:
1. The representations and warranties contained in Article IV of the
Credit Agreement are true and correct in all material respects on and as of
the date hereof, and will be true and correct in all material respects on
the date such Loan is [continued][converted] (both before and after such
Loan is [continued][converted]), as if such representations and warranties
were made on and as of such dates.
2. No Event of Default or Default has occurred and is continuing or
will exist on the date such [Loan][Advance] is [continued][converted]
(whether before or after such Loan is [continued][converted]).
Acceptance of the proceeds of such [continued][converted] Loan by the
Designated Borrower shall be deemed to be a further representation and
warranty that the representations and warranties made herein are true and
correct in all material respects at the time of such [continuation]
[conversion].
Capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Credit Agreement, dated as of
January 14, 2005 among Invacare Corporation, an Ohio corporation (the
"Company"), the Borrowing Subsidiaries designated therein from time to time
(collectively with the Company, the "Borrowers"), the banks named therein,
and you, as administrative agent for the Banks.
INVACARE CORPORATION
By: ________________________________
Its: _______________________________