EXHIBIT 4.1
EXECUTION COPY
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[JPMORGAN LOGO]
$208,500,000
CREDIT AGREEMENT
dated as of
March 31, 2003
among
TBC CORPORATION
The Lenders Party Hereto,
U.S. BANK NATIONAL ASSOCIATION
as Documentation Agent,
SUNTRUST BANK
as Syndication Agent,
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
as Administrative Agent
and
JPMORGAN CHASE BANK
as Co-Administrative Agent
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▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
as Sole Advisor, Lead Arranger and Bookrunner
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TABLE OF CONTENTS
PAGE
ARTICLE I Definitions............................................................................................ 1
SECTION 1.01. Defined Terms........................................................................... 1
SECTION 1.02. Classification of Loans and Borrowings.................................................. 20
SECTION 1.03. Terms Generally......................................................................... 21
SECTION 1.04. Accounting Terms; GAAP.................................................................. 21
ARTICLE II The Credits........................................................................................... 21
SECTION 2.01. Revolving and Term Loan Commitments..................................................... 21
SECTION 2.02. Loans and Borrowings.................................................................... 22
SECTION 2.03. Requests for Borrowings................................................................. 23
SECTION 2.04. Swingline Loans......................................................................... 25
SECTION 2.05. Letters of Credit....................................................................... 26
SECTION 2.06. Funding of Borrowings................................................................... 30
SECTION 2.07. Interest Elections...................................................................... 31
SECTION 2.08. Termination and Reduction of Revolving Credit Commitments............................... 32
SECTION 2.09. Repayment of Loans; Evidence of Debt.................................................... 32
SECTION 2.10. Prepayment of Loans..................................................................... 35
SECTION 2.11. Fees.................................................................................... 36
SECTION 2.12. Interest................................................................................ 37
SECTION 2.13. Alternate Rate of Interest.............................................................. 38
SECTION 2.14. Increased Costs......................................................................... 39
SECTION 2.15. Break Funding Payments.................................................................. 40
SECTION 2.16. Taxes................................................................................... 40
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs............................. 41
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.......................................... 43
ARTICLE III Representations and Warranties....................................................................... 44
SECTION 3.01. Organization; Powers.................................................................... 44
SECTION 3.02. Authorization; Enforceability........................................................... 44
SECTION 3.03. Governmental Approvals; No Conflicts.................................................... 44
SECTION 3.04. Financial Condition; No Material Adverse Change......................................... 44
SECTION 3.05. Properties.............................................................................. 45
SECTION 3.06. Litigation and Environmental Matters.................................................... 45
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PAGE
SECTION 3.07. Compliance with Laws and Agreements..................................................... 46
SECTION 3.08. Investment and Holding Company Status................................................... 46
SECTION 3.09. Taxes................................................................................... 46
SECTION 3.10. ERISA................................................................................... 46
SECTION 3.11. Disclosure.............................................................................. 47
SECTION 3.12. Margin Stock............................................................................ 47
SECTION 3.13. Compliance with Conditions Precedent.................................................... 47
SECTION 3.14. Labor Matters........................................................................... 47
SECTION 3.15. Assets.................................................................................. 47
SECTION 3.16. Security Documents...................................................................... 47
SECTION 3.17. Solvency................................................................................ 48
SECTION 3.18. Certain Documents....................................................................... 48
SECTION 3.19. Regulation H............................................................................ 48
ARTICLE IV Conditions............................................................................................ 48
SECTION 4.01. Effective Date.......................................................................... 48
SECTION 4.02. Each Credit Event....................................................................... 50
ARTICLE V Affirmative Covenants.................................................................................. 51
SECTION 5.01. Punctual Payment........................................................................ 51
SECTION 5.02. Financial Statements and Other Information.............................................. 51
SECTION 5.03. Notices of Material Events.............................................................. 52
SECTION 5.04. Existence; Conduct of Business.......................................................... 52
SECTION 5.05. Payment of Obligations.................................................................. 53
SECTION 5.06. Maintenance of Properties; Insurance.................................................... 53
SECTION 5.07. Books and Records; Inspection Rights.................................................... 53
SECTION 5.08. Compliance with Laws.................................................................... 53
SECTION 5.09. Use of Proceeds......................................................................... 53
SECTION 5.10. Intercompany Loans/Payments............................................................. 53
SECTION 5.11. Subsidiary Guarantees and Collateral.................................................... 54
SECTION 5.12. Environmental Laws...................................................................... 54
SECTION 5.13. Additional Collateral, etc.............................................................. 55
SECTION 5.14. Title Insurance, etc.................................................................... 55
ARTICLE VI Negative Covenants.................................................................................... 57
SECTION 6.01. Indebtedness............................................................................ 57
SECTION 6.02. Liens................................................................................... 58
SECTION 6.03. Fundamental Changes..................................................................... 59
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PAGE
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions............................... 59
SECTION 6.05. Hedging Agreements...................................................................... 61
SECTION 6.06. Transactions with Affiliates............................................................ 61
SECTION 6.07. Restrictive Agreements.................................................................. 61
SECTION 6.08. Fixed Charge Coverage Ratio............................................................. 62
SECTION 6.09. Maximum Leverage Ratio.................................................................. 62
SECTION 6.10. Adjusted Debt to EBITDAR................................................................ 63
SECTION 6.11. Asset Test.............................................................................. 64
SECTION 6.12. Disclosure.............................................................................. 64
SECTION 6.13. Sale of Assets.......................................................................... 64
SECTION 6.14. Restricted Payments..................................................................... 64
ARTICLE VII Events of Default.................................................................................... 65
ARTICLE VIII The Administrative Agent and the Co-Administrative Agent............................................ 67
ARTICLE IX Miscellaneous......................................................................................... 70
SECTION 9.01. Notices................................................................................. 70
SECTION 9.02. Waivers; Amendments..................................................................... 70
SECTION 9.03. Expenses; Indemnity; Damage Waiver...................................................... 72
SECTION 9.04. Successors and Assigns; Participations and Assignments.................................. 73
SECTION 9.05. Survival................................................................................ 76
SECTION 9.06. Counterparts; Integration; Effectiveness................................................ 76
SECTION 9.07. Severability............................................................................ 77
SECTION 9.08. Right of Setoff......................................................................... 77
SECTION 9.09. Governing Law, Jurisdiction; Consent to Service of Process.............................. 77
SECTION 9.10. WAIVER OF JURY TRIAL.................................................................... 78
SECTION 9.11. Headings................................................................................ 78
SECTION 9.12. Confidentiality......................................................................... 78
SECTION 9.13. Interest Rate Limitation................................................................ 79
Schedule 1.01A FORM OF ASSIGNMENT AND ACCEPTANCE..........................................................
Schedule 1.01B FORM OF INCREMENTAL FACILITY ACTIVATION NOTICE.............................................
Schedule 1.01C EXISTING LETTERS OF CREDIT.................................................................
Schedule 2.01 COMMITMENTS................................................................................
Schedule 2.02 FORM OF NEW LENDER SUPPLEMENT..............................................................
Schedule 3.01 BORROWER AND SUBSIDIARIES AND JURISDICTIONS OF
ORGANIZATION............................................................................
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PAGE
Schedule 3.15 TRADEMARKS, TRADENAMES AND SERVICE MARKS...................................................
Schedule 3.16(a) UCC FILING JURISDICTIONS...................................................................
Schedule 3.16(b) MORTGAGE FILING JURISDICTIONS..............................................................
Schedule 4.01(b) FORM OF OPINION LETTER.....................................................................
Schedule 4.01(f) FORM OF GUARANTEE AND COLLATERAL AGREEMENT.................................................
Schedule 5.10 CERTAIN INTERCOMPANY LOANS.................................................................
Schedule 6.01 EXISTING INDEBTEDNESS......................................................................
Schedule 6.01(e) GUARANTEE OBLIGATIONS OF BIG O TIRES, INC. AND SUBSIDIARIES................................
Schedule 6.02 EXISTING LIENS.............................................................................
Schedule 6.03(a) DISPOSITION OF PROPERTY OF BIG O TIRES, INC. OR BIG
O RETAIL ENTERPRISES.......................................................................
Schedule 6.04(b) CERTAIN EXISTING INVESTMENTS AND LOANS.....................................................
Schedule 6.07 EXISTING RESTRICTIONS......................................................................
Schedule 6.13 CERTAIN ASSET SALES........................................................................
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of March 31, 2003, is among
TBC Corporation, a Delaware corporation with its principal office located at
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Borrower"), the Lenders
signatory to this Agreement (each a "Lender"), First Tennessee Bank National
Association, a banking corporation with its principal office located at ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as administrative agent for the
Lenders (in such capacity, the "Administrative Agent") and JPMorgan Chase Bank,
a banking corporation with an office located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, as co-administrative agent for the Lenders (in such capacity the
"Co-Administrative Agent").
RECITALS
WHEREAS, the Borrower is a party to an existing $160,000,000
amended and restated credit agreement (as amended from time to time, the
"Existing Credit Agreement"), dated as of January 5, 2001 among the Borrower,
certain of its subsidiaries, as guarantors, various lenders and the agents named
therein;
WHEREAS, the Borrower intends to refinance, terminate and
replace the Existing Credit Agreement (the "Refinancing"); and
WHEREAS, to facilitate the Refinancing, and to finance the
acquisition of Merchant's, Incorporated and its subsidiary (the "Merchant's
Acquisition"), the Borrower's working capital needs, capital expenditures,
further acquisitions and for all other general corporate purposes, the Borrower
wishes to establish with the Lenders credit facilities providing for term loans,
revolving loans, letters of credit and swingline loans of up to $208,500,000 in
the aggregate maximum principal amount at any time outstanding, and the Lenders
and the Administrative Agent are willing to establish such credit facilities on
the terms and conditions set forth herein;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties hereto,
such parties hereby agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Acceptable Acquisition" has the meaning set forth in Section
6.04.
2
"Additional Prudential Notes" means the Senior Notes the
Borrower issued and Prudential purchased pursuant to the Note Agreement to be
dated as of April 1, 2003 between the Borrower and Prudential and its
affiliates.
"Adjusted LIBO Rate" means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such
Interest Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means First Tennessee Bank National
Association, in its capacity as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum
equal to the highest of (a) the Prime Rate in effect on such day, and (b) the
Federal Funds Effective Rate in effect on such day plus 0.5%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the effective
day of such change in the Prime Rate, or the Federal Funds Effective Rate,
respectively.
"Applicable Percentage" means, with respect to any Lender, at
any time, the percentage of the total Revolving Credit Commitments represented
by such Lender's Revolving Credit Commitment at such time. If the Revolving
Credit Commitments have terminated or expired, the Applicable Percentages shall
be determined based upon the principal amount of all Revolving Loans
outstanding, giving effect to any assignments and any increase pursuant to
Section 2.02(d).
"Applicable Rate" means, for any day, with respect to any ABR
Loan or Eurodollar Loan, or with respect to the commitment fees payable
hereunder, as the case may be, the applicable rate per annum, stated in basis
points, set forth below under the caption "ABR Spread", "Eurodollar Spread" or
"Commitment Fee Rate", as the case may be, based upon the Leverage Ratio as in
effect on such date:
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Commitment
Leverage Ratio: ABR Spread Eurodollar Spread Fee Rate
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Category 1
>3.00 175.0 275.0 50.00
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Category 2
>=2.50 but
<=3.00 150.0 250.0 37.50
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Category 3 125.0 225.0 37.50
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Commitment
Leverage Ratio: ABR Spread Eurodollar Spread Fee Rate
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>=2.00 but
<2.50
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Category 4
>= 1.50 but
<2.00 100.0 200.0 30.00
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Category 5
<1.50 75.0 175.0 25.00
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For purposes of the foregoing, the Leverage Ratio shall be
determined and adjusted on the first day of the month after the month in which
the Borrower provides the Financial Officer's certificate in accordance with the
provisions of Section 5.02(c) (each a "Ratio Calculation Date"). The initial
Applicable Rate shall be 150 basis points for ABR Loans and 250 basis points for
Eurodollar Borrowings, and shall not be less than such rate until the first
Ratio Calculation Date subsequent to September 30, 2003. If the Borrower fails
to provide a Financial Officer's certificate required by Section 5.02(c) on or
before the date required pursuant to such Section, the Applicable Rate shall be
based on Category 1 from such date until such time that an appropriate Financial
Officer's certificate is provided, whereupon the Applicable Rate shall then be
determined by the Leverage Ratio reflected on such Financial Officer's
certificate, until the next Ratio Calculation Date. Subject to the preceding
sentence, each determination of the Applicable Rate shall be effective from one
Ratio Calculation Date until the next Ratio Calculation Date. Any adjustment in
the Applicable Rate shall be applicable to all existing Loans as well as any new
Loans made, as long as the adjusted Applicable Rate remains in effect. For
purposes of the foregoing table:
< means less than
<= means less than or equal to
> means greater than
>= means equal to or greater than.
"Approved Fund" has the meaning assigned to such term in
Section 9.04(b).
"Arranger" means ▇. ▇. ▇▇▇▇▇▇ Securities Inc. in its capacity
as arranger of the Commitments.
"Assignee" has the meaning assigned to such term in Section
9.04(b).
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Schedule 1.01A or any other form approved by the Administrative
Agent.
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"Availability Period" means the period from and including the
Effective Date to but excluding the earlier of the Revolving Credit Maturity
Date or the date of termination of the Revolving Credit Commitments.
"Available Revolving Credit Commitment" means, with respect to
each Lender, at any time, the amount of its Revolving Credit Commitment minus
its Revolving Credit Exposure, at such time.
"Available Tranche B Term Commitment" means, with respect to
each Lender, at any time, the amount of its Tranche B Term Commitment minus its
Tranche B Term Exposure, at such time.
"Board" means the Board of Governors of the Federal Reserve
System of the United States of America.
"Borrower" has the meaning set forth in the introductory
paragraph of this Agreement.
"Borrowing" means (a) Loans that are of the same Class and
Type, that are made, converted or continued on the same date and, in the case of
Eurodollar Loans, as to which a single Interest Period is in effect or (b) a
Swingline Loan.
"Borrowing Request" means a request by the Borrower for a
Revolving Borrowing or a Tranche B Borrowing, as the case may be, in accordance
with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or
other day on which commercial banks in Memphis, Tennessee are authorized or
required by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"Capital Expenditures" mean, for any period, expenditures
(including the aggregate amount of Capital Lease Obligations incurred during
such period) made directly or indirectly by the Borrower or any Subsidiary to
acquire or construct fixed assets, property, plant and equipment (including
renewals, improvements, replacements and substitutions, but excluding repairs)
during such period, computed in accordance with GAAP.
"Capital Lease Obligations" of any Person means the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Change in Control" means (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof)
of shares representing more than 20% of the aggregate ordinary voting
5
power represented by the issued and outstanding capital stock of the Borrower;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of the Borrower by Persons who were neither (i) nominated by the
board of directors of the Borrower nor (ii) appointed by directors so nominated;
or (c) the acquisition of direct or indirect Control of the Borrower by any
Person or group.
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender (or,
for purposes of Section 2.14(b), by any lending office of such Lender or by such
Lender's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans, Term Loans or Swingline Loans.
"Co-Administrative Agent" means JPMorgan Chase Bank in its
capacity as co-administrative agent for the Lenders hereunder.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Commitment" means, with respect to each Lender, the
commitment of such Lender to make Loans of a given Class, and to acquire
participations in Letters of Credit and Swingline Loans, hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08 and (b)
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender's Commitment
to make Loans of a given Class is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Commitment, as applicable. The initial aggregate amount of the Lenders'
Commitments is $208,500,000.
"Conduit Lender" means any special purpose corporation
organized and administered by any Lender for the purpose of making Loans
otherwise required to be made by such Lender and designated by such Lender in a
written instrument; provided, that the designation by any Lender of a Conduit
Lender shall not relieve the designating Lender of any of its obligations to
fund a Loan under this Agreement if, for any reason, its Conduit Lender fails to
fund any such Loan, and the designating Lender (and not the Conduit Lender)
shall have the sole right and responsibility to deliver all consents and waivers
required or requested under this Agreement with respect to its Conduit Lender,
and provided, further, that no Conduit Lender shall (a) be entitled to receive
any greater amount pursuant to Section 2.14, 2.15, 2.16 or 9.03 than the
designating Lender would have been entitled to receive in respect of the
extensions of credit made by such Conduit Lender or (b) be deemed to have any
Commitment.
"Consolidated Funded Indebtedness" means all Funded
Indebtedness of the Borrower and its Subsidiaries after eliminating
inter-company items, including any Funded
6
Indebtedness outstanding pursuant to and under this Agreement, in each case
determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means for any period for which
such amount is being determined, the interest expense of the Borrower and the
Consolidated Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, including (i) the amortization of debt discounts to the
extent included in interest expense in accordance with GAAP, (ii) the
amortization of all fees (including fees with respect to Hedging Agreements)
payable in connection with the incurrence of Indebtedness to the extent included
in interest expense in accordance with GAAP and (iii) the portion of any rents
payable under Capital Lease Obligations allocable to interest expense in
accordance with GAAP.
"Consolidated Net Income" means the net income of the Borrower
and its Consolidated Subsidiaries, after taxes and after extraordinary items as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Subsidiaries" means Subsidiaries whose accounts
are consolidated with the accounts of the Borrower in the Borrower's
consolidated financial statements prepared in accordance with GAAP.
"Consolidated Total Liabilities" means, at any date the
consolidated total liabilities of the Borrower and its Subsidiaries at such date
determined in accordance with GAAP.
"Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
"Default" means any event or condition which constitutes an
Event of Default or which solely upon notice, lapse of time or both would,
unless cured or waived, become an Event of Default.
"dollars" or "$" refers to lawful money of the United States
of America.
"EBITDA" means the sum of the following items measured for
each Fiscal Quarter:
(i) Consolidated Net Income, plus
(ii) depreciation, amortization, and all other non-cash
charges, plus
(iii) income taxes to the extent they reduce Consolidated
Net Income, plus
(iv) Consolidated Interest Expense.
In addition, (a) EBITDA shall include, on a pro forma basis for each Fiscal
Quarter (including any pro forma cost savings to the extent the same could be
reflected in pro forma financial statements contained in filings with the
Securities and Exchange Commission pursuant to its Regulation S-X), the
foregoing information with respect to each Person that was either acquired in an
Acceptable Acquisition or disposed of as permitted by this Agreement during such
Fiscal
7
Quarter, determined as if the Acquisition or disposition had taken place on the
first day of such Fiscal Quarter; and (b) whenever in this Agreement EBITDA is
determined for a period of four Fiscal Quarters, it shall include, on a pro
forma basis for such period (including any pro forma cost savings), the
foregoing information with respect to each Person that was either acquired in an
Acceptable Acquisition or disposed of as permitted by this Agreement during such
period, determined as if the Acquisition or disposition had taken place on the
first day of such four Fiscal Quarter period.
"Effective Date" means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.02).
"Environmental Laws" means all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower
8
or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to be,
insolvent or in reorganization, within the meaning of Title IV of ERISA.
Notwithstanding the foregoing, the Borrower's termination of the TBC Corporation
Retirement Plan, and the Borrower's incurrence of liability under Title IV of
ERISA with respect to such termination, shall not constitute an ERISA Event if,
after giving effect to the termination and any liability incurred by the
Borrower in connection therewith, the Borrower remains in compliance with the
financial covenants set forth in Sections 6.08 through 6.11, inclusive.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in
Article VII.
"Excluded Foreign Subsidiary" means any Foreign Subsidiary in
respect of which either (a) the pledge of all of the Capital Stock of such
Subsidiary as Collateral or (b) the guaranteeing by such Subsidiary of the
Obligations, would, in the good faith judgment of the Borrower, result in
adverse tax consequences to the Borrower.
"Excluded Taxes" means, with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.18(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender's failure to comply with Section 2.16(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.16(a).
"Existing Credit Agreement" has the meaning assigned thereto
in the recitals hereto.
"Existing Letters of Credit" means any letter of credit listed
on Schedule 1.01C.
"Existing Note Agreement" has the meaning assigned thereto in
the definition of "Prudential Debt".
"Facility Obligations" means, in each case, whether now in
existence or hereafter arising, (i) the principal of, and interest and premium,
if any, on, the Loans; (ii) the LC Exposure; and (iii) all other Indebtedness,
covenants, duties and obligations (including contingent obligations) now or at
any time or times hereafter owing by Borrower to Administrative Agent,
9
the Co-Administrative Agent or any Lender under or pursuant to this Agreement or
any of the other Loan Documents, whether evidenced by any note or other writing,
whether arising from any extension of credit, opening of a Letter of Credit,
acceptance, loan, Guarantee, indemnification or otherwise and whether direct or
indirect, absolute or contingent, due or to become due, primary or secondary, or
joint or several, including all interest, charges, expenses, fees or other sums
chargeable to Borrower or any Guarantor under this Agreement or under any of the
other Loan Documents.
"Federal Funds Effective Rate" means, for any day, the
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer,
principal accounting officer, treasurer, assistant treasurer (to the extent
authorized to act) or controller of the Borrower.
"Fiscal Quarter" means each fiscal quarter-year period of the
Borrower, ending on the last day of each March, June, September and December.
"Fiscal Year" means the fiscal year of the Borrower, which is
the calendar year.
"Foreign Lender" means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.
"Funded Indebtedness" means any outstanding Indebtedness of a
Person for borrowed money, including all such Indebtedness of the Person to the
Lenders and other financial institutions, domestic or foreign, and all secured
and unsecured notes payable, all industrial revenue bonds, all Capital Lease
Obligations and other similar debt obligations and the current maturities
thereof, but excluding all Guarantees of Funded Indebtedness. (Checks that have
not been presented for payment shall not constitute Funded Indebtedness.)
"GAAP" means generally accepted accounting principles in the
United States of America.
"Governmental Authority" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Grantors" means the Borrower and its Subsidiaries that are
parties to the Guarantee and Collateral Agreement.
10
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"Guarantee and Collateral Agreement" means the Guarantee and
Collateral Agreement to be executed and delivered by the Borrower and each
Grantor, substantially in the form of Schedule 4.01(f).
"Guarantor" means a Person liable pursuant to a Guarantee of
any of the Facility Obligations, which Guarantee is in form satisfactory to the
Required Lenders (the Guarantee and Collateral Agreement being in such a form).
"Hazardous Materials" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Agreement" means any interest rate protection
agreement, foreign currency exchange agreement, commodity price protection
agreement or other interest or currency exchange rate or commodity price hedging
arrangement.
"Incremental Facility Activation Notice" means a notice
substantially in the form of Schedule 1.01B.
"Incremental Facility Closing Date" means any Business Day
designated as such in an Incremental Facility Activation Notice.
"Indebtedness" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such
11
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty, (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances, and
(k) all obligations of such Person related to Synthetic Leases. The Indebtedness
of any Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person
is liable therefor as a result of such Person's ownership interest in or other
relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Information Memorandum" means the Confidential Information
Memorandum dated February 2003 relating to the Borrower and the Transactions.
"Intercompany Loan" means any Indebtedness for borrowed money
loaned by the Borrower to any of its Wholly-Owned Subsidiaries, by any
Wholly-Owed Subsidiary to the Borrower or by any Wholly-Owned Subsidiary to
another Wholly-Owned Subsidiary.
"Intercreditor Agreement" means the Intercreditor Agreement
among Prudential, each Lender, the Administrative Agent, the Co-Administrative
Agent and the Collateral Agent, dated as of March 31, 2003.
"Interest Election Request" means a request by the Borrower to
convert or continue a Borrowing in accordance with Section 2.07.
"Interest Payment Date" means (a) with respect to any ABR Loan
and Swingline Loan, the last day of each March, June, September and December and
(b) with respect to any Eurodollar Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurodollar Borrowing with an Interest Period of more than three months'
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months' duration after the first day of such Interest Period.
"Interest Period" means with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter, as the Borrower may elect; provided, that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day, unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
COPYRIGHT REGISTRATIONS
Title of Work Copyright Reg. No. Reg. Date
------------- ----------------- ---------
TBC Corporation TX-2-920-912 09/21/90
Electronic Ordering System
Info-Net User's Guide TX-4-135-989 11/13/95
(Info-Net Online; Direct
Connection Info-Net)
Info-Net Online, Release 4.1 TX-4-168-625 12/07/95
(Info-Net Online; Direct
Connection Info-Net)
Electronic Ordering System TX-4-212-078 12/07/95
Release 1.0
Annex 1 to
Guarantee and Collateral Agreement
ASSUMPTION AGREEMENT, dated as of ________________, 200_, made by
______________________________ (the "Additional Grantor"), in favor of JPMorgan
Chase Bank, as collateral agent (in such capacity, the "Collateral Agent") for
the banks and other financial institutions or entities (the "Lenders") parties
to the Credit Agreement referred to below and The Prudential Insurance Company
of America ("Prudential") and its affiliates (the "Prudential Affiliates") party
to the Note Agreements referred to below (the Lenders, Prudential and the
Prudential Affiliates collectively referred to as the "Secured Parties"). All
capitalized terms not defined herein shall have the meaning ascribed to them in
such Credit Agreement.
W I T N E S S E T H :
WHEREAS, TBC Corporation (the "Borrower"), the Lenders, the Administrative
Agent and the Co-Administrative Agent have entered into a Credit Agreement,
dated as of March 31, 2003 (as amended, supplemented or otherwise modified from
time to time, the "Credit Agreement");
WHEREAS, the Borrower and Prudential have entered into the Amended and
Restated Note Agreement, dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Existing Note Agreement") and the
Borrower, Prudential and the Prudential Affiliates have entered into the Note
Purchase Agreement, dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Additional Note Agreement") (the
Existing Note Agreement and the Additional Note Agreement collectively referred
to as "Note Agreements");
WHEREAS, in connection with the Credit Agreement and the Note Agreements,
the Borrower and certain of its Affiliates (other than the Additional Grantor)
have entered into the Guarantee and Collateral Agreement, dated as of March 31,
2003 (as amended, supplemented or otherwise modified from time to time, the
"Guarantee and Collateral Agreement") in favor of the Collateral Agent for the
benefit of the Secured Parties;
WHEREAS, the Credit Agreement and the Note Agreements require the
Additional Grantor to become a party to the Guarantee and Collateral Agreement;
and
WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Collateral Agreement. By executing and delivering this
Assumption Agreement, the Additional Grantor, as provided in Section 8.14 of the
Guarantee and Collateral Agreement, hereby becomes a party to the Guarantee and
Collateral Agreement as a Grantor thereunder with the same force and effect as
if originally named therein as a Grantor and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations
and liabilities of a Grantor thereunder. The information set forth in Annex 1-A
hereto is hereby added to the information set forth in the Schedules to the
Guarantee and Collateral Agreement. The Additional Grantor hereby represents and
warrants that each of the representations and warranties contained in Section 4
of the Guarantee and Collateral Agreement is true and correct on and as the date
hereof (after giving effect to this Assumption Agreement) as if made on and as
of such date.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement
to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]
By:
-------------------------
Name:
Title:
Annex 1-A to
Assumption Agreement
Supplement to Schedule 1
Supplement to Schedule 2
Supplement to Schedule 3
Supplement to Schedule 4
SCHEDULE 5.10
CERTAIN INTERCOMPANY LOANS
Provided that no Event of Default has occurred and is continuing, payments on
Intercompany Loans owed to Borrower by the following Subsidiaries may be made
without regard to the financial condition or solvency of the Subsidiary:
Northern States Tire, Inc.
Big O Development, Inc.
SCHEDULE 6.01
EXISTING INDEBTEDNESS
The Prudential Debt and the Additional Prudential Notes.
Those Guarantees listed on Schedule 6.01(e).
TBC Corporation has guaranteed a $1,500,000 line of credit made available to TBC
de Mexico and TBC International Inc. by First Tennessee Bank National
Association.
TBC Corporation has guaranteed all obligations of Big O Retail Enterprises,
Inc., Tire Kingdom, Inc., Big O Tires, Inc., and ▇▇▇▇▇▇▇'▇, Inc., and (after the
closing date of the Merchant's Acquisition) expects to guarantee all obligations
of Merchant's Incorporated, to Michelin North America, Inc. and its affiliates.
TBC Corporation has guaranteed all obligations of Tire Kingdom, Inc. to
Continental General Tire, Inc.
Capital Lease relating to the Salt Lake City Warehouse of Big O Tires, Inc.
(book value as of 2/28/03 is $1,162,666).
SCHEDULE 6.01(e)
GUARANTEE OBLIGATIONS OF BIG O TIRES, INC. AND SUBSIDIARIES
Big O Guarantee Portion at 12/31/02
The CIT Group
Intermountain Realty - Colorado Springs $ 411,995.64
Intermountain Realty - Sioux Falls 380,757.97
▇▇▇▇▇▇▇ ▇▇▇▇▇
Loan portfolio (sold 6/30/97,9/30/97,12/31/98) 92,956.28
GE Capital
Las Vegas 2,787,922.87
Las Vegas 394,156.28
82nd St. Oregon 247,277.12
Boulder, CO 48,917.50
OKC, LLC JV 150,000.00
Real Estate Lease Guarantees 1,315,240.18
Synthetic Lease 8,757,896.38
------------
Total Guarantees $ 14,587,120.22
SCHEDULE 6.02
EXISTING LIENS
- Liens arising under the Guarantee and Collateral Agreement.
- Numerous UCC financing statements evidencing operating lease transactions
in which TBC Corporation and its Subsidiaries are lessees have been filed
and are still in effect.
- Mortgage on the Tennessee headquarters of TBC Corporation recorded
pursuant to the Existing Credit Agreement (which shall be released prior
to recordation of Mortgage pursuant to Section 4.01(g) of this Credit
Agreement).
UCC Filings and Mortgages Against Big O Tires, Inc. and Its Subsidiaries:
The Bank of Cherry Creek, N.A., as Indenture Trustee. Security interests
and mortgages granted in connection with 8.71% Senior Secured Notes in the
aggregate original principal amount of $8,000,000 issued by Big O Tires,
Inc. in 1994. Notes were paid in full in 1999, and Big O Tires, Inc. has
tried on numerous occasions, without success, to obtain termination
statements for various UCC filings relating thereto.
The CIT Group/Equipment Financing, Inc. Filings in connection with sales
of franchisee notes receivable.
SunTrust Bank, as Agent. Filings in connection with Synthetic Leases.
First National Bank of ▇▇▇▇▇▇▇▇▇. Filing in connection with equipment
financing by Big O Tire of Idaho, inc.
▇▇▇▇▇ ▇. ▇▇▇▇
Filing to evidence consigned Interstate Battery System of America
inventory.
UCC Filings Against Tire Kingdom, Inc.:
Michelin North America, Inc. and related entities.
Purchase money security interest filing against all inventory
purchased from secured party by Tire Kingdom and all proceeds
therefrom.
UCC Filings Against Merchant's, Incorporated or Merban, Inc:
Bridgestone/Firestone, Inc.
Consigned inventory of the secured party.
Kimco Select Investments
Blanket security interest filed by secured party; debt has been
discharged and secured party to release Liens promptly after the
closing of the Merchant's Acquisition.
CIT Group/Business Credit, Inc.
Mortgages and blanket security interest filed by secured party; debt
has been discharged and secured party to release mortgages and Liens
promptly after the closing of the Merchant's Acquisition.
Michelin North America, Inc. and related entities
Mortgages and security interests filed by secured party, who has
agreed to release the same promptly after the closing of the
Merchant's Acquisition.
SunTrust Bank
Blanket security interest filed by secured party; debt has been
discharged and secured party to release Liens promptly after the
closing of the Merchant's Acquisition.
Bandag, Incorporated
Liens relating to Bandag equipment and related collateral used in
the retreading operations of Merban.
SCHEDULE 6.04(b)
CERTAIN EXISTING INVESTMENTS AND LOANS
- See Schedule 3.01 for a listing of all existing Subsidiaries.
- TBC Corporation owns 40% of STI Acquisition LLC, a Nevada limited
liability company.
- TBC Corporation owns 20,000 shares of Series A Preferred Stock, $.01 par
value, of ▇▇▇▇▇ Automotive, Corp. and 14.4 shares of Common Stock, $100
par value, of V.I.P., Inc. (total investment - $5,000,000).
- TBC International Inc. owns approximately 49% of the ownership interests
in TBC de Mexico, S.A. de C.V., a Mexican company.
- Big O Retail Enterprises, Inc. is a 50% shareholder in Tires Industries
Corporation, a Utah corporation.
- Big O Development, Inc. loaned ▇▇▇▇▇ ▇▇▇▇▇▇▇ Tufts $297,000 on October 10,
1994. At 12/31/02, the balance on the promissory note relating thereto was
$122,483.
- ▇▇▇▇▇▇▇'▇, Inc. owns 50 shares of stock of The Hercules Tire & Rubber
Company.
- ▇▇▇▇▇▇▇'▇ Inc. owns 360 shares of stock of Carmerica, Inc.
- Big O Tires, Inc. holds a 50% interest in each of the following joint
ventures:
BORE/MPC, LLC (a Missouri LLC)
Big O/▇▇▇▇▇▇▇▇▇▇ Joint Venture LLC (a Nevada LLC)
OKC, LLC (a Colorado LLC)
Intermountain Development Joint Venture (a Colorado general
partnership)
One Stop Undercar Denver, LLC (a Colorado LLC)
SCHEDULE 6.07
EXISTING RESTRICTIONS
The documents evidencing the Prudential Debt and the Additional Prudential Debt
contain restrictions and conditions of the type described in Section 6.07.
The Synthetic Leases contain restrictions and conditions of the type described
in Section 6.07.
It is expected that the documents evidencing the SunTrust Sale and Leaseback
will contain restrictions and conditions of the type described in Section 6.07.
SCHEDULE 6.13
CERTAIN ASSET SALES
NONE.
292208.1
292210.1
12
"Issuing Bank" means First Tennessee Bank National Association
and JPMorgan Chase Bank, each in its capacity as the issuer of Letters of Credit
hereunder, and its successors in such capacity as provided in Section 2.05(i).
The Issuing Bank may, in its discretion, arrange for one or more Letters of
Credit to be issued by Affiliates of the Issuing Bank, in which case the term
"Issuing Bank" shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate.
"Joint Venture" means a joint venture formed to provide
distribution for the products of the Borrower, Big O Tires, Inc. or any other
Subsidiary, which joint venture is accounted for under GAAP as an investment and
not as a Subsidiary or as an acquisition or a capital expenditure.
"LC Disbursement" means a payment made by any Issuing Bank
pursuant to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be the aggregate of the Lender's participations under Section 2.05(e)
in the outstanding Letters of Credit at such time, including its aggregate
participations in Letters of Credit with respect to which one or more LC
Disbursements that have not yet been reimbursed by or on behalf of the Borrower.
"Lenders" means the Persons listed on Schedule 2.01 and any
other Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.
"Letter of Credit" means any letter of credit issued pursuant
to this Agreement.
"Leverage Ratio" at any time means the ratio of Consolidated
Funded Indebtedness as of the end of the most recent Fiscal Quarter to the
aggregate EBITDA for the four Fiscal Quarter period ended with the most recent
Fiscal Quarter, and includes any adjustments based on Acceptable Acquisitions
and dispositions as provided in the definition of EBITDA.
"LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, the rate appearing on Page 3750 of the Telerate Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal
13
London office of JPMorgan Chase Bank in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor under
any conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means this Agreement, the Guarantee and
Collateral Agreement, any Mortgage and any other Guarantee of any of the
Facility Obligations that may from time to time be in effect.
"Loans" means the loans made by the Lenders to the Borrower
pursuant to this Agreement.
"Long-Term Indebtedness" means any Indebtedness that, in
accordance with GAAP, constitutes (or, when incurred, constituted) a long-term
liability.
"Material Adverse Effect" means a material adverse effect on
(a) the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and its Subsidiaries taken as a whole or (b) the
validity or enforceability of this Agreement or any of the other Loan Documents
or the rights or remedies of the Administrative Agent of the Lenders hereunder
or thereunder.
"Material Indebtedness" means Indebtedness (other than the
Loans and Letters of Credit) or obligations in respect of one or more Hedging
Agreements, of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount exceeding $5,000,000. For purposes of determining
Material Indebtedness, the "principal amount" of the obligations of the Borrower
or any Subsidiary in respect of any Hedging Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the
Borrower or such Subsidiary would be required to pay if such Hedging Agreement
were terminated at such time.
"Merchant's Acquisition" has the meaning assigned thereto in
the recitals hereto.
"Merchant's Acquisition Agreement" means the Stock Purchase
Agreement, dated as of March 25, 2003, by and among the Borrower and the
stockholders of Merchant's Incorporated.
"Merchant's Acquisition Documentation" means, collectively,
the Merchant's Acquisition Agreement and all schedules, exhibits and annexes
thereto and all side letters and agreements affecting the terms thereof or
entered into in connection therewith.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
14
"Mortgage" means any mortgage referred to in Section 4.01(g)
and any mortgage executed and delivered after the Closing Date pursuant to
Section 5.13(a).
"Mortgaged Property" means the property described in Section
4.01(g) and any real properties as to which the Collateral Agent shall be
granted a Mortgage pursuant to Section 5.13(a).
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any event, (a) the cash
proceeds received in respect of such event, including (i) any cash received in
respect of any non-cash proceeds, but only as and when received, (ii) in the
case of a casualty or other insured damage, insurance proceeds, and (iii) in the
case of a condemnation or similar event, condemnation awards and similar
payments, net of (b) the sum of (i) all reasonable fees and out-of-pocket
expenses paid by the Borrower and its Subsidiaries to third parties in
connection with such event, (ii) in the case of a sale, transfer or other
disposition of an asset (including pursuant to a sale and leaseback transaction
permitted under Section 6.13(d) or a casualty or a condemnation or similar
proceeding), the amount of all payments required to be made by the Borrower and
its Subsidiaries as a result of such event to repay Indebtedness (other than
Loans, the Prudential Debt and the Additional Prudential Notes) secured by such
asset or otherwise subject to mandatory prepayment as a result of such event (to
the extent such repayment is permitted hereunder), and (iii) the amount of all
taxes paid (or reasonably estimated to be payable) by the Borrower or any
Subsidiary, and the amount of any reserves established by the Borrower and its
Subsidiaries to fund contingent liabilities or contingent obligations reasonably
estimated to be available, in each case during the year that such event occurred
or the next succeeding year and that are directly attributable to such event (as
determined reasonably and in good faith by the chief financial officer of the
Borrower), provided that the amount of any subsequent reduction of any such
reserve (other than in connection with a payment in respect of any such
liability) shall be deemed to be Net Proceeds of a Prepayment Event occurring on
the date of such reduction.
"New Lender" has the meaning set forth in Section 2.02(e).
"New Lender Supplement" has the meaning set forth in Section
2.02(e).
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.
"Participant" has the meaning set forth in Section 9.04(c).
"PBGC" means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
15
(a) Liens imposed by law for taxes that are not yet due
or are being contested in compliance with Section 5.05;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with
Section 5.05;
(c) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case
in the ordinary course of business;
(e) judgment liens in respect of judgments that do not
constitute an Event of Default under clause (k) of Article VII;
(f) easements, zoning restrictions, rights-of-way and
similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property
or interfere with the ordinary conduct of business of the Borrower or
any Subsidiary; and
(g) Liens of landlords on fixtures and leasehold
improvements granted or arising in the ordinary course of business;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means:
(a) direct obligations of, or obligations the principal
of and interest on which are unconditionally guaranteed by, the United
States of America (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United
States of America), in each case maturing within one year from the date
of acquisition thereof;
(b) investments in commercial paper maturing within 270
days from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from S&P or from
Moody's;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with, and money
market deposit accounts issued or offered by, any domestic office of
any commercial bank organized under the laws of the United
16
States of America or any State thereof which has a combined capital and
surplus and undivided profits of not less than $500,000,000; and
(d) fully collateralized repurchase agreements with a
term of not more than 30 days for securities described in clause (a)
above and entered into with a financial institution satisfying the
criteria described in clause (c) above.
"Person" means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prepayment Event" means:
(a) any sale and leaseback transaction permitted pursuant
to Section 6.13(d), or any other sale, transfer, or other disposition
of any property or asset of the Borrower or any Subsidiary, other than
dispositions permitted pursuant to Section 6.13(a), (b), (c) (e) (f) or
(g);
(b) any casualty or other insured damage to, or any
taking under power of eminent domain or by condemnation or similar
proceeding of, any property or asset of the Borrower or any Subsidiary,
but only to the extent that the Net Proceeds therefrom have not been
applied to repair, restore or replace such property or asset or to
acquire other real property, equipment or other tangible assets to be
used in the business of the Borrower or any Subsidiary within one year
after such event; or
(c) the incurrence by the Borrower or any Subsidiary of
any Indebtedness, other than Indebtedness permitted by Section 6.01.
"Prime Rate" means the rate of interest per annum publicly
announced from time to time by JPMorgan Chase Bank as its prime rate in effect
at its principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Properties" has the meaning set forth in Section 3.06(b).
"Prudential" means The Prudential Insurance Company of America
together with any of its affiliates, managed accounts and funds from time to
time holding Prudential Debt or Additional Prudential Notes.
"Prudential Debt" means Borrower's obligations pursuant to a
certain Second Amended and Restated Note Agreement to be dated as of April 1,
2003 between Borrower and The Prudential Insurance Company of America
("Prudential") (the "Existing Note Agreement"), governing the terms of the
Borrower's (i) 8.30% Series A Senior Notes due July 10, 2003, (ii)
17
8.62% Series B Senior Notes due July 10, 2005 and (iii) 8.81% Series C Senior
Notes due July 10, 2008.
"Register" has the meaning set forth in Section 9.04(b).
"Reimbursement Obligation" means the obligation of the
Borrower to reimburse any Issuing Bank pursuant to Section 2.05(e) for amounts
drawn under Letters of Credit.
"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.
"Required Lenders" means, at any time, Lenders having
aggregate Revolving Credit Exposures, Term Loan Exposures and unused Revolving
Credit Commitments representing more than 51% of the sum of the total Revolving
Credit Exposures, Term Loan Exposures and unused Revolving Credit Commitments at
such time.
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower or any Subsidiary, or any payment
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such shares of capital stock of
the Borrower or any option, warrant or other right to acquire any such shares of
capital stock of the Borrower.
"Revolving Credit Commitment" means, with respect to each
Lender, the commitment of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08, (b)
reduced or increased from time to time pursuant to assignments by or to such
Lenders pursuant to Section 9.04 and (c) increased from time to time pursuant to
Section 2.02(d). The initial amount of each Lender's Revolving Credit Commitment
is set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to
which such Lender shall have assumed its Revolving Credit Commitment, as
applicable. The initial aggregate amount of the Lenders' Revolving Credit
Commitments is $121,500,000.
"Revolving Credit Exposure" means, with respect to any Lender
at any time, the sum of the outstanding principal amounts of such Lender's
Revolving Loans and its LC Exposure and Swingline Exposure at such time.
"Revolving Credit Maturity Date" means April 1, 2008.
"Revolving Loan" means a Loan made pursuant to Section 2.03.
"S&P" means Standard & Poor's.
"Scheduled Payments" means, for any period, the sum (without
duplication) of the aggregate amount of scheduled principal payments made during
such period in respect of
18
Long-Term Indebtedness of the Borrower and its Subsidiaries (other than payments
made by the Borrower or any Subsidiary to the Borrower or a Subsidiary).
"Solvent", when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "present fair saleable
value" of the assets of such Person will, as of such date, exceed the amount of
all "liabilities of such Person, contingent or otherwise", as of such date, as
such quoted terms are determined in accordance with applicable federal and state
laws governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim", and
(ii) "claim" means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.
"Statutory Reserve Rate" means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.
"subsidiary" means, with respect to any Person (the "parent")
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (b) that is, as of
such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent, except
that no Joint Venture in which the entire amount invested by the Borrower and
its Subsidiaries complies with Section 6.04(d), shall be deemed to be a
subsidiary.
"Subsidiary" means any subsidiary of the Borrower; provided,
however, that in no event shall TBC de Mexico be considered to be a Subsidiary
for purposes hereof (but, to the
19
extent required by GAAP, shall be consolidated in the consolidated financial
statements of the Borrower and as such included in the calculation of the
covenants in Sections 6.08, 6.09 and 6.10) until such time, if any, as
Borrower's interest in TBC de Mexico exceeds 60%, Borrower is required by GAAP
to consolidate TBC de Mexico into Borrower's consolidated financial statements,
and Borrower's equity investment in TBC de Mexico exceeds $2,500,000.
"Substantial Portion" means, with respect to the property of
the Borrower and its Subsidiaries, property which (i) represents more than 10%
of the consolidated assets of the Borrower and its Subsidiaries as would be
shown in the consolidated financial statements of the Borrower and its
Subsidiaries as at the beginning of the twelve-month period ending at the end of
the month in which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the Consolidated Net Income of the
Borrower and its Subsidiaries as reflected in the financial statements referred
to in clause (i) above.
"SunTrust Sale and Leaseback" means the sale for a price not
to exceed $12,000,000 and the leasing back of up to fourteen retail stores
currently owned by Merchant's, Incorporated.
"Swingline Exposure" means, at any time, the aggregate
principal amount of all Swingline Loans outstanding at such time. The Swingline
Exposure of any Lender at any time shall be its Applicable Percentage of the
total Swingline Exposure at such time.
"Swingline Lender" means First Tennessee Bank National
Association, in its capacity as lender of Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section 2.04.
"Synthetic Lease" means any lease entered into by Big O Tires,
Inc. or Big O Development, Inc. (each a "Lessee") pursuant to the existing
$15,000,000 lease program with SunTrust Capital Markets, Inc. ("SunTrust")
contemplated by that certain Master Agreement, dated as of December 2, 1998,
among the Lessees, SunTrust, Borrower, and the Atlantic Financial Group, Ltd.,
as from time to time amended.
"Taxes" means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loan Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amounts of such Lender's Term Loans
at such time.
"Term Loan Maturity Date" means April 1, 2008.
"Term Loans" means, collectively, the Tranche A Term Loans and
the Tranche B Term Loans.
"Tranche A Term Commitment" means as to any Lender the
obligation of such Lender, if any, to make a Tranche A Term Loan to the Borrower
in a principal amount not to exceed the amount set forth under the heading
"Tranche A Term Commitment" opposite such Lender's name on Schedule 2.01.
20
"Tranche A Term Lender" means each Lender that has a Tranche A
Term Commitment or that holds a Tranche A Term Loan.
"Tranche A Term Loan" means a Loan made pursuant to Section
2.01(b).
"Tranche B Term Commitment" means as to any Lender the
obligation of such Lender, if any, to make a Tranche B Term Loan to the Borrower
in a principal amount not to exceed the amount set forth under the heading
"Tranche B Term Commitment" opposite such Lender's name on Schedule 2.01.
"Tranche B Term Exposure" means, with respect to any Lender at
any time, the sum of the outstanding principal amounts of such Lender's Tranche
B Term Loans.
"Tranche B Term Lender" means each Lender that has a Tranche B
Term Commitment or that holds a Tranche B Term Loan.
"Tranche B Term Loan" means a Loan made pursuant to Section
2.01(c).
"Tranche B Term Loan Availability Period" means the period
from and including the Effective Date to but excluding September 30, 2003.
"Transactions" means the execution, delivery and performance
by the Borrower of the Loan Documents, the borrowing of Loans, the use of the
proceeds thereof and the issuance of Letters of Credit hereunder and the
execution, delivery and performance by the Guarantors of the Facility
Obligations.
"Type", when used in reference to any Loan or Borrowing,
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.
"Wholly-Owned Subsidiary" of a Person means any Subsidiary all
of whose outstanding voting securities, or ownership interests having ordinary
voting power, are at the time owned (i) directly by such Person, (ii) directly
and indirectly by such Person and one or more of such Person's Wholly-Owned
Subsidiaries or (iii) by one or more of such Person's Wholly-Owned Subsidiaries.
"Withdrawal Liability" means liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g., a "Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class
and Type (e.g., a "Eurodollar Revolving Loan"). Borrowings also may be
classified and referred to by Class (e.g., a "Revolving Borrowing") or by Type
(e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar
Revolving Borrowing").
21
SECTION 1.03. Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections and Schedules shall be construed to
refer to Articles and Sections of, and Schedules to, this Agreement and (e) the
words "asset" and "property" shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts, contract rights and all other
real and personal property.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed, and all financial information and reports provided pursuant to
this Agreement shall be prepared, in accordance with GAAP, as in effect from
time to time; provided that, if the Borrower notifies the Co-Administrative
Agent that the Borrower 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
Co-Administrative Agent notifies the Borrower that the Required Lenders 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 Credits
SECTION 2.01. Revolving and Term Loan Commitments. (a) Subject
to the terms and conditions set forth herein, each Lender agrees to make
Revolving Loans to the Borrower from time to time during the Availability Period
in an aggregate principal amount that will not result in (i) such Lender's
Revolving Credit Exposure exceeding such Lender's Revolving Credit Commitment or
(ii) the sum of the total Revolving Credit Exposures exceeding the total
Revolving Credit Commitments. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Loans.
(b) Subject to the terms and conditions set forth herein,
each Tranche A Term Lender agrees to make a Tranche A Term Loan to the Borrower
on the Effective Date in the amount so designated after such Lender's name in
Schedule 2.01 not to exceed the Tranche A
22
Term Commitment of such Lender. Once a Tranche A Term Loan is repaid or prepaid,
it may not be reborrowed.
(c) Subject to the terms and conditions set forth herein,
each Tranche B Term Lender agrees to make Tranche B Term Loans in minimum
amounts of its ratable share of $5,000,000 to the Borrower on the Effective Date
and on up to two occasions thereafter during the Tranche B Term Loan
Availability Period in an aggregate principal amount not to exceed the Tranche B
Term Commitment of such Lender. Once a Tranche B Term Loan is repaid or prepaid,
it may not be reborrowed.
SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be
made as part of a Borrowing consisting of Loans made by the Lenders ratably in
accordance with their respective Commitments to make Loans of the applicable
Class, provided that Borrowings of Revolving Loans shall consist of Loans made
by the Lenders ratably in accordance with their respective Available Revolving
Credit Commitments. The failure of any Lender to make any Loan required to be
made by it shall not relieve any other Lender of its obligations hereunder;
provided that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.13, (i) each Revolving Borrowing
shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request in accordance herewith and (ii) each Term Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.
(c) At the commencement of each Interest Period for any
Eurodollar Revolving Borrowing, such Borrowing shall be in an aggregate amount
that is an integral multiple of $100,000 and not less than $1,000,000. At the
time that each ABR Revolving Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of $100,000 and not less than
$100,000; provided that an ABR Revolving Borrowing may be in an aggregate amount
that is equal to the entire unused balance of the total Revolving Credit
Commitments, or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.05(e). Each Swingline Loan shall be in
an amount that is an integral multiple of $100,000 and not less than $100,000.
At the commencement of each Interest Period for any Eurodollar Term Borrowing,
such Borrowing shall be in an aggregate amount that is an integral multiple of
$100,000 and not less than $1,000,000. Borrowings of more than one Type may be
outstanding at the same time; provided that there shall not at any time be more
than a total of twelve Eurodollar Borrowings outstanding.
(d) The Borrower and any one or more Lenders (including
New Lenders) may from time to time agree that without the consent of the other
Lenders hereunder such Lenders shall increase the amount of such Lenders'
Revolving Commitments (or in the case of New Lenders establish Revolving
Commitments) by executing and delivering to the Co-Administrative Agent an
Incremental Facility Activation Notice specifying (i) the respective amounts of
such increases (or such new Revolving Commitments) and (ii) the applicable
23
Incremental Facility Closing Date, provided, that (A) no Default or Event of
Default has occurred and is continuing or would result after giving effect to
the increase of the Revolving Commitments or the intended application of the
proceeds therefrom, (B) the Applicable Rate determined as of the applicable
Incremental Facility Closing Date shall not be greater than the Applicable Rate
then in effect for Revolving Loans, (C) the aggregate Revolving Commitments
after giving effect to any increase pursuant to this Section 2.02(d) shall not
exceed $150,000,000 and (D) each increase in the Revolving Commitments pursuant
to this Section 2.02(d) shall be in a minimum amount of at least $5,000,000. Any
incremental Revolving Commitments shall be governed by this Agreement and the
other Loan Documents. No Lender shall have any obligation to participate in any
increase described in this paragraph unless it agrees in writing to do so in its
sole discretion.
(e) Any additional bank, financial institution or other
entity that, with the consent of the Borrower and the Co-Administrative Agent
(which consent shall not be unreasonably withheld), elects to become a "Lender"
under this Agreement in connection with any transaction described in Section
2.02(d) shall execute a New Lender Supplement (each, a "New Lender Supplement"),
substantially in the form of Schedule 2.02, whereupon such bank, financial
institution or other entity (a "New Lender") shall become a Lender for all
purposes and shall be bound by and entitled to the benefits of this Agreement.
(f) The Borrower shall borrow Revolving Loans under the
increased Revolving Commitments from each Lender participating in any increase
in the Revolving Commitments pursuant to Section 2.2(d) (i) on the relevant
Incremental Facility Closing Date, if ABR Revolving Loans are then outstanding,
in an amount of ABR Loans that will result in each such participating Lender
having ABR Loans outstanding in a principal amount equal to its Applicable
Percentage of the total outstanding principal amount of ABR Loans and (ii) on
such Incremental Facility Closing Date, if a Eurodollar Borrowing is being
continued for another Interest Period on such date, and in and on any later date
on which a Eurodollar Borrowing outstanding on such Incremental Facility Closing
Date is being continued for another Interest Period, in each case in an amount
that will result in each such participating Lender having Eurodollar Revolving
Loans made by it included in such Eurodollar Borrowing in a principal amount
equal to its Applicable Percentage of the total outstanding principal amount of
Eurodollar Loans included in such Eurodollar Borrowing.
(g) Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled (i) to request, or to elect to
convert or continue, any Borrowing of Revolving Loans if the Interest Period
requested with respect thereto would end after the Revolving Credit Maturity
Date or (ii) to convert or continue any Borrowing of Term Loans if the Interest
Period requested with respect thereto would end after the Term Loan Maturity
Date.
SECTION 2.03. Requests for Borrowings. (a) To request a
Revolving Borrowing, the Borrower shall give to the Administrative Agent
irrevocable notice which notice must be received by the Administrative Agent (1)
in the case of a Eurodollar Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, three Business Days before the date of the proposed Revolving
Borrowing or (2) in the case of an ABR Borrowing, not later than 11:30 a.m.,
Memphis, Tennessee time, on the Business Day of the proposed Revolving
Borrowing; provided that any such notice of an ABR Revolving Borrowing to
finance any Reimbursement
24
Obligation may be given no later than 10:00 am, Memphis, Tennessee time on the
date of the proposed Borrowing. Each such Borrowing Request shall specify the
following information:
(i) the aggregate amount of the requested Revolving
Borrowing;
(ii) the date of such Revolving Borrowing, which shall be
a Business Day;
(iii) whether such Revolving Borrowing is to be an ABR
Borrowing, or a Eurodollar Borrowing;
(iv) in the case of a Eurodollar Revolving Borrowing, the
initial Interest Period to be applicable thereto, which shall be a
period contemplated by the definition of the term "Interest Period";
and
(v) the location and number of the Borrower's account to
which funds are to be disbursed, which shall comply with the
requirements of Section 2.06.
If no election as to the Type of Revolving Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurodollar Revolving Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
(b) To request a Term Borrowing, the Borrower shall give
to the Administrative Agent irrevocable notice which notice must be received by
the Administrative Agent (1) in the case of a Eurodollar Borrowing, not later
than 11:30 a.m., Memphis, Tennessee time, three Business Days before the date of
the proposed Borrowing or (2) in the case of an ABR Borrowing, not later than
11:30 a.m., Memphis, Tennessee time, on the Business Day of the proposed Term
Borrowing. Each such telephonic and written Borrowing Request shall specify the
following information:
(i) the aggregate amount of the requested Term Borrowing;
(ii) the date of such Term Borrowing, which shall be a
Business Day;
(iii) whether such Term Borrowing is to be an ABR
Borrowing, or a Eurodollar Borrowing;
(iv) in the case of a Eurodollar Term Borrowing, the
initial Interest Period to be applicable thereto, which shall be a
period contemplated by the definition of the term "Interest Period";
and
(v) the location and number of the Borrower's account to
which funds are to be disbursed, which shall comply with the
requirements of Section 2.06.
If no election as to the Type of Term Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested
25
Eurodollar Term Borrowing, then the Borrower shall be deemed to have selected an
Interest Period of one month's duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Term Lender of the details thereof and of the amount of such
Lender's Term Loan to be made as part of the requested Term Borrowing.
SECTION 2.04. Swingline Loans. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of outstanding Swingline Loans exceeding the
lesser of 15% of the Revolving Credit Commitments or $20,000,000 or (ii) the sum
of the total Revolving Credit Exposures exceeding the total Revolving Credit
Commitments; provided that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall
notify the Administrative Agent of such request by telephone (confirmed by
telecopy), not later than 12:00 p.m., Memphis, Tennessee time, on the day of a
proposed Swingline Loan. Each such notice shall be irrevocable and shall specify
the requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender shall
make each Swingline Loan available to the Borrower by means of a credit to the
general deposit account of the Borrower with the Swingline Lender (or, in the
case of a Swingline Loan made to finance the reimbursement of an LC Disbursement
as provided in Section 2.05(e), by remittance to the Issuing Bank) by 3:00 p.m.,
Memphis, Tennessee time, on the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to
the Administrative Agent not later than 10:00 a.m., Memphis, Tennessee time, on
any Business Day require the Lenders to acquire participations on such Business
Day in all or a portion of the Swingline Loans outstanding. Such notice shall
specify the aggregate amount of Swingline Loans in which Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will
give notice thereof to each Lender, specifying in such notice such Lender's then
Applicable Percentage of such Swingline Loan or Loans. Each Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided above,
to pay to the Administrative Agent, for the account of the Swingline Lender,
such Lender's then Applicable Percentage of such Swingline Loan or Loans. Each
Lender acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Revolving Credit
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Lender shall comply with
its obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.06 with respect to Loans made
by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment
obligations of the Lenders), and the Administrative Agent shall promptly pay to
the Swingline Lender the amounts so received by it from the Lenders. The
26
Administrative Agent shall notify the Borrower of any participations in any
Swingline Loan acquired pursuant to this paragraph, and thereafter payments in
respect of such Swingline Loan shall be made to the Administrative Agent and not
to the Swingline Lender. Any amounts received by the Swingline Lender from the
Borrower (or other party on behalf of the Borrower) in respect of a Swingline
Loan after receipt by the Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the Administrative Agent;
any such amounts received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Lenders that shall have made their payments
pursuant to this paragraph and to the Swingline Lender, as their interests may
appear. The purchase of participations in a Swingline Loan pursuant to this
paragraph shall not relieve the Borrower of any default in the payment thereof.
SECTION 2.05. Letters of Credit. (a) General. Subject to the
terms and conditions set forth herein, the Borrower may request the issuance of
Letters of Credit for the account of the Borrower, but in the name of the
Borrower or any Subsidiary as may be specified by the Borrower, in a form
reasonably acceptable to each Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, any Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.
(b) Existing Letters of Credit. From and after the
Closing Date, the Existing Letters of Credit shall be deemed outstanding
pursuant to, and shall constitute "Letters of Credit" for all purposes of, this
Agreement.
(c) Notice of Issuance, Amendment, Renewal, Extension,
Certain Conditions. To request the issuance of a Letter of Credit (or the
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by such Issuing
Bank) to any Issuing Bank and the Administrative Agent (reasonably in advance of
the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (d)
of this Section), the amount of such Letter of Credit, the name and address of
the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. If requested by such
Issuing Bank, the Borrower also shall submit a letter of credit application on
such Issuing Bank's standard form in connection with any request for a Letter of
Credit. A Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Letter of Credit the
Borrower shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension (i) the LC Exposure shall not
exceed the lesser of 20% of the Revolving Credit Commitments or $25,000,000 and
(ii) the sum of the total Revolving Credit Exposures shall not exceed the total
Revolving Credit Commitments.
(d) Expiration Date. Each Letter of Credit shall expire
at or prior to the close of business on the earlier of (i) the date one year
after the date of the issuance of such Letter of
27
Credit (or, in the case of any renewal or extension thereof, one year after such
renewal or extension) and (ii) the date that is five Business Days prior to the
Revolving Credit Maturity Date.
(e) Participations. By the issuance of a Letter of Credit
(or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the Issuing Bank or the Lenders, each
Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from
such Issuing Bank, a participation in such Letter of Credit equal to such
Lender's Applicable Percentage as may be adjusted from time to time to reflect
assignments or transfers of Revolving Credit Commitments and any increase in the
Revolving Credit Commitment pursuant to Section 2.02(d), of the aggregate amount
available to be drawn under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of such Issuing Bank,
such Lender's Applicable Percentage, determined as of the date the Letter of
Credit was issued, of each LC Disbursement made by such Issuing Bank and not
reimbursed by the Borrower on the date due as provided in paragraph (f) of this
Section, or of any reimbursement payment required to be refunded to the Borrower
for any reason. Each Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever.
(f) Reimbursement Obligation. If any Issuing Bank shall
make any LC Disbursement in respect of a Letter of Credit, the Borrower shall
reimburse such LC Disbursement by paying to the Administrative Agent an amount
equal to such LC Disbursement not later than 12:00 noon, Memphis, Tennessee
time, on the date that such LC Disbursement is made, if the Borrower shall have
received notice of such LC Disbursement prior to 10:00 a.m., Memphis, Tennessee
time, on such date, or, if such notice has not been received by the Borrower
prior to such time on such date, then not later than 12:00 noon, Memphis,
Tennessee time, on (i) the Business Day that the Borrower receives such notice,
if such notice is received prior to 10:00 a.m., Memphis, Tennessee time, on the
day of receipt, or (ii) the Business Day immediately following the day that the
Borrower receives such notice, if such notice is not received prior to such time
on the day of receipt; provided that if such LC Disbursement is not less than
$100,000, the Borrower may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 or 2.04 that such payment be
financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrower fails to make such payment when
due, the Issuing Bank shall notify the Administrative Agent thereof and the
Administrative Agent shall then notify each Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Lender's Applicable Percentage thereof. Promptly following receipt of such
notice from the Administrative Agent, each Lender shall pay to the
Administrative Agent such Applicable Percentage of the payment then due from the
Borrower, in the same manner as provided in Section 2.06 with respect to Loans
made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the
payment obligations of the Lenders), and the
28
Administrative Agent shall promptly pay to such Issuing Bank the amounts so
received by it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to such
Issuing Bank or, to the extent that Lenders have made payments pursuant to this
paragraph to reimburse such Issuing Bank, then to such Lenders and such Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse any Issuing Bank for any LC Disbursement (other than
the funding of ABR Revolving Loans or a Swingline Loan as contemplated above)
shall not constitute a Loan and shall not relieve the Borrower of its obligation
to reimburse such LC Disbursement.
(g) Obligations Absolute. The Borrower's obligation to
reimburse LC Disbursements as provided in paragraph (f) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Lenders nor any Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of any
Issuing Bank; provided that the foregoing shall not be construed to excuse any
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by such Issuing Bank's failure to exercise care
when determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or wilful misconduct on the part of any
Issuing Bank (as finally determined by a court of competent jurisdiction), such
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, each
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(h) Disbursement Procedures. Each Issuing Bank shall, in
accordance with standard banking practice following its receipt thereof, examine
all documents purporting to
29
represent a demand for payment under a Letter of Credit. Each Issuing Bank shall
promptly notify the Administrative Agent, any other Issuing Bank and the
Borrower by telephone (confirmed by telecopy) of such demand for payment and
whether such Issuing Bank has made or will make an LC Disbursement thereunder;
provided that any failure to give or delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse such Issuing Bank and the
Lenders with respect to any such LC Disbursement. On the Business Day three
Business Days prior to the last day of March, June, September and December of
each year and at such other times as the Administrative Agent shall request,
each Issuing Bank shall report to the Administrative Agent all Letters of Credit
issued by it during the then current calendar quarter and the average daily
undrawn and unexpired amounts for all Letters of Credit for each day in such
calendar quarter.
(i) Interim Interest. If any Issuing Bank shall make any
LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement
in full on the date such LC Disbursement is made, the unpaid amount thereof
shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses such
LC Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (f) of this Section, then Section 2.12(d) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of such
Issuing Bank, except that interest accrued on and after the date of payment by
any Lender pursuant to paragraph (f) of this Section to reimburse such Issuing
Bank shall be for the account of such Lender to the extent of such payment.
(j) Replacement of the Issuing Bank. Each Issuing Bank
may be replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.
The Administrative Agent shall notify the Lenders of any such replacement of any
Issuing Bank. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.11(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of the Issuing Bank under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall not be
required to issue additional Letters of Credit.
(k) Cash Collateralization. If any Event of Default shall
occur and be continuing, on the Business Day that the Borrower receives notice
from the Co-Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Lenders with LC Exposure representing greater
than 51% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such
date plus any accrued and unpaid interest thereon; provided that the obligation
to deposit such cash collateral shall become
30
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of any
Event of Default with respect to the Borrower described in clause (h) or (i) of
Article VII. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the obligations of the Borrower
under this Agreement. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and
at the Borrower's risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Administrative Agent to
reimburse each Issuing Bank for LC Disbursements for which it has not been
reimbursed and, to the extent not so applied, shall be held for the satisfaction
of the reimbursement obligations of the Borrower for the LC Exposure at such
time. If the Borrower is required to provide an amount of cash collateral
hereunder as a result of the occurrence of an Event of Default, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower within
three Business Days after all Events of Default have been cured or waived.
SECTION 2.06. Funding of Borrowings. (a) Provided that it has
received timely advice of the related Borrowing Request as required by the last
sentence of Section 2.03(a) or of Section 2.03(b), each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 2:00 p.m., Memphis, Tennessee time, to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders; provided that Swingline Loans shall be made as
provided in Section 2.04. The Administrative Agent will make each Borrowing
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with the Administrative Agent in
Memphis, Tennessee and designated by the Borrower in the applicable Borrowing
Request; provided that ABR Revolving Loans made to finance the reimbursement of
an LC Disbursement as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender's share
of such Borrowing, the Administrative Agent may assume that such Lender has made
such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable Borrowing available to the Administrative Agent,
then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the Borrower to but excluding the date of payment to the Administrative
Agent, at (i) in the case of such Lender, the Interest Rate applicable to the
Borrowing or (ii) in the case of the Borrower, the interest rate applicable to
ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.
31
SECTION 2.07. Interest Elections. (a) Each Revolving or Term
Borrowing initially shall be of the Type specified in the applicable Borrowing
Request and, in the case of a Eurodollar Borrowing, shall have an initial
Interest Period as specified in such Borrowing Request. Thereafter, the Borrower
may elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. This Section shall not apply to
Swingline Borrowings, which may not be converted or continued.
(b) To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly
by hand delivery or telecopy to the Administrative Agent of a written Interest
Election Request in a form approved by the Administrative Agent and signed by
the Borrower.
(c) Each telephonic and written Interest Election Request
shall specify the following information:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with
respect to different portions thereof, the portions thereof to
be allocated to each resulting Borrowing (in which case the
information to be specified pursuant to clauses (iii) and (iv)
below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to
such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing,
the Interest Period to be applicable thereto after giving
effect to such election, which shall be a period contemplated
by the definition of the term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then,
32
unless such Borrowing is repaid as provided herein, at the end of such Interest
Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding
any contrary provision hereof, if an Event of Default has occurred and is
continuing and the Administrative Agent, at the request of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing (i)
no outstanding Borrowing may be converted to or continued as Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.08. Termination and Reduction of Revolving Credit
Commitments. (a) Unless previously terminated, the Revolving Credit Commitments
shall terminate on the Revolving Credit Maturity Date.
(b) The Borrower may at any time terminate, or from time
to time reduce, the Revolving Credit Commitments; provided that (i) each
reduction of the Revolving Credit Commitments shall be in an amount that is an
integral multiple of $1,000,000 and not less than $5,000,000, (ii) the Borrower
shall not terminate or reduce the Revolving Credit Commitments if, after giving
effect to any concurrent prepayment of the Revolving Loans in accordance with
Section 2.10, the sum of the Revolving Credit Exposures would exceed the total
Revolving Credit Commitments.
(c) The Borrower shall notify the Co-Administrative Agent
of any election to terminate or reduce the Revolving Credit Commitments under
paragraph (b) of this Section at least three Business Days prior to the
effective date of such termination or reduction, specifying such election and
the effective date thereof. Promptly following receipt of any notice, the
Co-Administrative Agent shall advise the Administrative Agent and the Lenders of
the contents thereof. Each notice delivered by the Borrower pursuant to this
Section shall be irrevocable; provided that a notice of termination delivered by
the Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or reduction
shall be permanent. Each reduction shall be made ratably among the Lenders in
accordance with their respective Revolving Credit Commitments.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender, on the Revolving Credit Maturity Date, the then
unpaid principal amount of each of the Revolving Loans and (ii) to the Swingline
Lender the then unpaid principal amount of the Swingline Loans on the earlier of
the Revolving Credit Maturity Date or the first date after such Swingline Loans
are made that is the 15th or last day of a calendar month; provided that on each
date that a Revolving Borrowing is made, the Borrower shall repay all Swingline
Loans then outstanding.
(b) The Borrower hereby unconditionally promises to pay
to the Administrative Agent for the account of the Tranche A Term Lenders the
unpaid principal of all Tranche A Term Loans, on the dates and in the amounts
set forth below, with the entire unpaid principal balance due and payable on the
Term Loan Maturity Date:
33
Date Payment Amount
---- --------------
9/30/03 1,662,836.00
12/31/03 1,662,836.00
3/31/04 1,662,836.00
6/30/04 3,563,220.00
9/30/04 3,563,220.00
12/31/04 3,563,220.00
3/31/05 3,563,220.00
6/30/05 3,563,220.00
9/30/05 3,563,220.00
12/31/05 3,563,220.00
3/31/06 3,563,220.00
6/30/06 3,563,220.00
9/30/06 3,563,220.00
12/31/06 3,563,220.00
3/31/07 3,563,220.00
6/30/07 3,563,220.00
9/30/07 3,563,220.00
12/31/07 3,563,220.00
(c) The Borrower hereby unconditionally promises to pay
to the Administrative Agent for the account of the Tranche B Term Lenders the
unpaid principal of all Tranche B Term Loans, on the dates and in an aggregate
amount equal to the percentage set forth below opposite such installment date
multiplied by the aggregate principal amount of the Tranche B Term Loans
outstanding at the end of the Tranche B Term Loan Availability Period, with the
entire unpaid principal balance due and payable on the Term Loan Maturity Date:
34
Date Percentage
---- ----------
9/30/03 2.6800%
12/31/03 2.6800%
3/31/04 2.6800%
6/30/04 5.7475%
9/30/04 5.7475%
12/31/04 5.7475%
3/31/05 5.7475%
6/30/05 5.7475%
9/30/05 5.7475%
12/31/05 5.7475%
3/31/06 5.7475%
6/30/06 5.7475%
9/30/06 5.7475%
12/31/06 5.7475%
3/31/07 5.7475%
6/30/07 5.7475%
9/30/07 5.7475%
12/31/07 5.7475%
(d) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing the indebtedness of the
Borrower to such Lender resulting from each Loan made by such Lender, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(e) The Administrative Agent shall maintain accounts in
which it shall record (i) the amount of each Loan made hereunder, the Class and
Type thereof and the Interest Period, if any, applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender's share thereof.
(f) The entries made in the accounts maintained pursuant
to paragraph (d) or (e) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(g) Any Lender may request that Loans made by it be
evidenced by a promissory note only in order to facilitate pledges of the Loans
in accordance with Section 9.04(d). In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Co-Administrative Agent. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04(d) be represented by one or
more
35
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).
SECTION 2.10. Prepayment of Loans. (a) The Borrower shall have
the right at any time and from time to time to prepay any Borrowing in whole or
in part, subject to prior notice in accordance with paragraph (b) of this
Section.
(b) The Borrower shall notify the Administrative Agent
(and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, three Business Days before the date of prepayment, or (ii) in
the case of prepayment of an ABR Borrowing, not later than 11:30 a.m., Memphis,
Tennessee time, or (iii) in the case of prepayment of a Swingline Loan, not
later than 11:30 a.m., Memphis, Tennessee time, on the Business Day of
prepayment. Each such notice shall be irrevocable, shall identify the
Borrowing(s) being prepaid and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid; provided
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Revolving Credit Commitments as contemplated by Section
2.08, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.08. Promptly following
receipt of any such notice relating to a Borrowing, the Administrative Agent
shall advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type as provided in Section 2.02.
Each prepayment of a Borrowing shall be applied ratably to the Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.12.
(c) Borrower shall prepay the principal of the Term
Loans, of the Prudential Debt and of the Additional Prudential Notes, upon
notice and otherwise in compliance with Section 2.10(b) and/or the Revolving
Credit Commitments shall be reduced in accordance with Section 2.08, as follows:
(i) In the event that and on each occasion on
which any Net Proceeds are received by or on behalf of the
Borrower or any Subsidiary in respect of any Prepayment Event,
the Borrower shall, within three Business Days after such Net
Proceeds are received, prepay the principal of the Term Loans,
the Prudential Debt and the Additional Prudential Notes and/or
the Revolving Credit Commitments shall be subject to automatic
reduction, in an aggregate amount equal to such Net Proceeds,
such prepayment and/or reduction to be effected in each case
in the manner and to the extent specified in clause (ii) of
this paragraph.
(ii) Order of Application. Prepayments and/or
reductions of Revolving Credit Commitments pursuant to this
paragraph shall be applied as follows:
first, (A) to prepay the Term Loans, the Prudential
Debt and the Additional Prudential Notes and
36
second, after the payment in full of the Term Loans,
the Prudential Debt and the Additional Prudential Notes, to reduce the aggregate
amount of the Revolving Credit Commitments (and to the extent that, after giving
effect to such reduction, the total Revolving Credit Exposures would exceed the
Revolving Credit Commitments, the Borrower shall, first, prepay Revolving Credit
Loans and second, provide cover for LC Exposure as specified in Section 2.05(k)
in an aggregate amount equal to such excess).
Any prepayment of the Term Loans, the Prudential Debt and the Additional
Prudential Notes pursuant to this paragraph shall be applied (x) to each Term
Loan, the Prudential Debt and the Additional Prudential Notes, pro rata in the
same proportions as the then balance of each Term Loan, the Prudential Debt and
the Additional Prudential Notes bears to the total balance of all Term Loans
plus the Prudential Debt and the Additional Prudential Notes, provided that if
prepayment is waived with respect to the Prudential Debt and/or the Additional
Prudential Notes, the amounts that would have been payable absent such waiver
shall be reallocated on a pro rata basis among the Term Loans and any
non-waiving note holders, and (xx) with respect to each, to the last maturing
installments thereof. Notwithstanding the foregoing, the Borrower shall not be
required to apply any prepayment to the Prudential Debt or the Additional
Prudential Notes if such prepayment is not required pursuant to the terms
thereof and would cause the Borrower to incur any prepayment premium or penalty
and, in each event, any amount which would otherwise have been used to make a
prepayment of the Prudential Debt or the Additional Prudential Notes shall
instead be used, first, to prepay the Term Loans and, second, to reduce the
aggregate amount of the Revolving Commitments (and to the extent that, after
giving effect to such reduction, the total Revolving Credit Exposures would
exceed the Revolving Credit Commitments, the Borrower shall, first, prepay
Revolving Credit Loans and second, provide cover for LC Exposure as specified in
Section 2.05(k) in an aggregate amount equal to such excess).
SECTION 2.11. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee, which
shall accrue (x) at a rate per annum equal to 62.5 basis points on the average
daily amount of the Available Tranche B Term Commitment of such Lender during
the period from and including the Effective Date to but excluding September 30,
2003 and (y) at the Applicable Rate on the average daily amount of the Available
Revolving Credit Commitment of such Lender during the period from and including
the Effective Date to but excluding the date on which such Revolving Credit
Commitment terminates; provided that, (i) if such Lender continues to have any
Revolving Credit Exposure after its Revolving Credit Commitment terminates, then
such commitment fee shall continue to accrue on the daily amount of such
Lender's Revolving Credit Exposure from and including the date on which its
Revolving Credit Commitment terminates to but excluding the date on which such
Lender ceases to have any Revolving Credit Exposure; and (ii) the commitment fee
payable to the Swingline Lender shall accrue on the average daily amount of its
Available Revolving Credit Commitment minus the average daily principal balance
of the Swingline Loans during such period. Accrued commitment fees shall be
payable in arrears on the last day of March, June, September and December of
each year and, with respect to commitment fees payable pursuant to clause (y)
above, on the date on which the Revolving Credit Commitments terminate,
commencing on the first such date to occur after the date hereof; provided that
any commitment fees payable pursuant to clause (y) above and accruing after the
date on which the Revolving Credit Commitments terminate shall be payable on
demand. All commitment fees shall be
37
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(b) The Borrower agrees to pay to the Administrative
Agent, for the account of each Lender, a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate as interest on Eurodollar Loans on the average daily amount of such
Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender's Revolving Credit
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to each Issuing Bank a fronting fee, which shall accrue at
the rate of 12.5 basis points per annum on the average daily amount of such
Issuing Bank's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Revolving Credit Commitments and the date on which there ceases to be any LC
Exposure, as well as such Issuing Bank's standard fees with respect to the
issuance, amendment, renewal or extension of any Letter of Credit or processing
of drawings thereunder. Participation fees and fronting fees accrued through and
including the last day of March, June, September and December of each year shall
be payable on the third Business Day following such last day, commencing on the
first such date to occur after the Effective Date; provided that all such fees
shall be payable on the date on which the Revolving Credit Commitments terminate
and any such fees accruing after the date on which the Revolving Credit
Commitments terminate shall be payable on demand. Any other fees payable to any
Issuing Bank pursuant to this paragraph shall be payable within 10 days after
demand. All participation fees and fronting fees shall be computed on the basis
of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative
Agent, for its own account, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates
due, in immediately available funds, to the Administrative Agent (or to such
Issuing Bank, in the case of fees payable to it) for distribution, in the case
of Letter of Credit participation fees and commitment fees, to the Lenders. Fees
paid shall not be refundable under any circumstances.
SECTION 2.12. Interest. (a) The Loans comprising each ABR
Borrowing shall bear interest at the Alternate Base Rate plus the Applicable
Rate.
(b) The Loans comprising each Eurodollar Borrowing shall
bear interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate.
(c) Swingline Loans shall bear interest at the Federal
Funds Effective Rate plus applicable Eurodollar Spread plus 15 basis points.
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(d) Notwithstanding the foregoing, if any principal of or
interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount, 2%
plus the rate applicable to ABR Loans as provided in paragraph (a) of this
Section.
(e) Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan and upon termination of the
Revolving Credit Commitments; provided that (i) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (ii) in the event of
any repayment or prepayment of any Loan (other than a prepayment of a Revolving
Loan prior to the end of the Availability Period) accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
(f) All interest hereunder shall be computed on the basis
of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the Prime
Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate, Federal Funds Effective Rate or Adjusted LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent demonstrable error.
SECTION 2.13. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which
determination shall be conclusive absent demonstrable error) that
adequate and reasonable means do not exist for ascertaining the
Adjusted LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required
Lenders that the Adjusted LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest
Period; or
(c) the Administrative Agent is advised by one or more
Lender(s), but less than the Required Lenders, that the Adjusted LIBO
Rate for such Interest Period will not adequately and fairly reflect
the cost to such Lender(s) of making or maintaining their Loans (or its
Loan) included in such Borrowing for such Interest Period;
then, in the case of clause (a) or (b) above, the Administrative Agent shall
give notice thereof to the Borrower and the Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, (i) any Interest Election Request that requests the
39
conversion of any Borrowing to, or continuation of any Borrowing as, a
Eurodollar Borrowing shall be ineffective, and (ii) if any Borrowing Request
requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing; and in the case of clause (c) above, the Administrative Agent shall
give notice thereof to the Borrower and the Lenders by telephone or telecopy as
promptly as practicable thereafter and, until the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving rise to such notice
no longer exist, (i) any Interest Election Request that requests the conversion
of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing
shall be ineffective as to the Lender(s) giving notice under clause (c), (ii) if
any Borrowing Request requests a Eurodollar Borrowing, the Loans made by such
clause (c) Lender(s) as part of such Borrowing shall be made as ABR Loans and
(iii) the Interest Election Request or Borrowing Request shall be effective as
against the other Lenders and the affected Borrowings shall have all of the
characteristics specified in such Interest Election Request or Borrowing
Request, except that interest on the Loans made by the clause (c) Lenders shall
be computed at the ABR Rate.
SECTION 2.14. Increased Costs. (a) If any Change in Law shall:
(i) 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 Lender (except any
such reserve requirement reflected in the Adjusted LIBO Rate) or any
Issuing Bank, or
(ii) impose on any Lender or any Issuing Bank, or the
London interbank market, any other condition affecting this Agreement
or Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or such
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or such
Issuing Bank, hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered.
(b) If any Lender or any Issuing Bank, determines that
any Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's or such Issuing Bank's, holding company, if any, as a consequence of
this Agreement or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a
level below that which such Lender or such Issuing Bank, or such Lender's or
such Issuing Bank's, holding company could have achieved but for such Change in
Law (taking into consideration such Lender's or such Issuing Bank's policies and
the policies of such Lender's or such Issuing Bank's holding company with
respect to capital adequacy), then from time to time the Borrower will pay to
such Lender or such Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or such Issuing Bank, or such Lender's or
such Issuing Bank's, holding company for any such reduction suffered.
40
(c) A certificate of a Lender or an Issuing Bank, setting
forth the amount or amounts necessary to compensate such Lender or such Issuing
Bank, or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent demonstrable error. The Borrower shall pay such Lender or such
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or any
Issuing Bank, to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or such Issuing Bank's, right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender or an Issuing Bank, pursuant to this Section for any
increased costs or reductions incurred more than 120 days prior to the date that
such Lender or such Issuing Bank, as the case may be, notifies the Borrower of
the Change in Law giving rise to such increased costs or reductions and of such
Lender's or such Issuing Bank's, intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the 120-day period referred to above shall be
extended to include the period of retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section
2.10(b) and is revoked in accordance therewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.18, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent demonstrable error. The Borrower shall
pay such Lender the amount shown as due on any such certificate within 10 days
after receipt thereof.
SECTION 2.16. Taxes. (a) Any and all payments by or on account
of any obligation of the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions
41
applicable to additional sums payable under this Section) the Administrative
Agent, each Lender or each Issuing Bank (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, the Borrower shall pay any Other Taxes
to the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative
Agent, each Lender and each Issuing Bank, within 10 days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent or such Lender or such Issuing Bank, as the case may
be, on or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or an Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or an Issuing
Bank, shall be conclusive absent demonstrable error.
(d) As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement, shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing
of Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements or of amounts payable under Section 2.14, 2.15 or 2.16, or
otherwise) prior to 12:00 noon, Memphis time, on the date when due, in
immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, except payments to be made directly to any Issuing
Bank or Swingline Lender as expressly provided herein and except that payments
pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the
Persons entitled thereto. The
42
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements, then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of
set-off or counterclaim or otherwise, obtain payment in respect of any principal
of or interest on any of its Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loans or participations in LC
Disbursements or Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
or participations in LC Disbursements or Swingline Loans of other Lenders to the
extent necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans or participations in LC Disbursements
or Swingline Loans; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC Disbursements or
Swingline Loans to any assignee or participant, other than to the Borrower or
any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.
(d) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Banks
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Banks, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or each of
the Issuing
43
Banks, as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or Issuing Bank
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on
interbank compensation.
(e) If any Lender shall fail to make any payment required
to be made by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b) or
2.17(d), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.
(a) If any Lender exercises its rights under Section 2.13(c) or requests
compensation under Section 2.14, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.16, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce the cost referred to in
Section 2.11(c) or amounts payable pursuant to Section 2.12 or 2.14, as the case
may be, in the future and (ii) would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender in connection with any such designation or assignment.
(b) If any Lender exercises its rights under Section
2.13(c) or requests compensation under Section 2.14, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, or if any
Lender defaults in its obligation to fund Loans hereunder, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from an exercise of rights under
Section 2.13(c) or a claim for compensation under Section 2.14 or payments
required to be made pursuant to Section 2.16, such assignment will result in
elimination of the Section 2.13(c) rights on the part of the assignee or a
reduction in such compensation or payments. A Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.
44
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers.
(a) The Borrower and each of its Subsidiaries is a
corporation, limited liability company, partnership, association or other
business entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required. The jurisdiction of organization of the Borrower and each of its
Subsidiaries existing on the Effective Date is indicated on Schedule 3.01.
(b) As of the Effective Date, the Borrower owns the
direct and indirect interests in the Subsidiaries specified in Schedule 3.01.
The Borrower's record and beneficial ownership, direct and indirect, of each
Subsidiary is free from any material restriction, equity, security interest, or
other Lien except as set forth in Schedule 3.01.
SECTION 3.02. Authorization; Enforceability. The Transactions
are within the Borrower's and each Grantor's corporate powers and have been duly
authorized by all necessary corporate and, if required, stockholder action. This
Agreement and each of the other Loan Documents has been duly executed and
delivered by the Borrower and/or the Grantor executing the same and constitutes
a legal, valid and binding obligation of the Borrower, and/or each such Grantor,
enforceable in accordance with its respective terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The
Transactions and the execution, delivery and performance of the Loan Documents
by the respective parties thereto (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority,
except such as have been obtained or made and are in full force and effect, (b)
will not violate any applicable law or regulation or the charter, by-laws or
other organizational documents of the Borrower or any of its Subsidiaries or any
order of any Governmental Authority, (c) will not violate or result in a default
under any indenture, agreement or other instrument binding upon the Borrower or
any of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Borrower or any of its Subsidiaries, and
(d) will not result in the creation or imposition of any Lien on any asset of
the Borrower or any of its Subsidiaries except pursuant to the Loan Documents.
SECTION 3.04. Financial Condition; No Material Adverse Change.
(a) The Borrower has heretofore furnished to the Lenders its (i) audited
consolidated and unaudited consolidating balance sheet and statements of income,
stockholders equity and cash flows as of
45
and for the Fiscal Years ended December 31, 2001 and December 31, 2002, reported
on by PricewaterhouseCoopers LLP, independent public accountants, and (ii)
unaudited interim consolidated and consolidating financial statements, certified
by its chief financial officer, for each Fiscal Quarter ended after the date of
the latest applicable financial statements delivered pursuant to clause (i) of
this paragraph as to which such financial statements are available. Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and its
Consolidated Subsidiaries as of such dates and for such periods in accordance
with GAAP, subject to year end audit adjustments and the absence of footnotes in
the case of the statements referred to in clause (ii) above.
(b) Since December 31, 2002, there has been no material
adverse change in the business, assets, operations, prospects or condition,
financial or otherwise, of the Borrower and its Subsidiaries, taken as a whole.
SECTION 3.05. Properties. (a) The Borrower and each of its
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to its business, free and clear of all Liens
except for the Liens set forth on Schedule 6.02, for Liens permitted by Section
6.02 and for minor defects in title that do not interfere with its ability to
conduct its business as currently conducted or to utilize such properties for
their intended purposes.
(b) The Borrower and each of its Subsidiaries owns, or is
licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Borrower and its Subsidiaries does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No material claim has been asserted and is pending by any Person
challenging or questioning the use of any such intellectual property or the
validity or effectiveness of such intellectual property, nor does the Borrower
know of any valid basis for any such claim.
SECTION 3.06. Litigation and Environmental Matters. (a) There
are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect or (ii) that involve this
Agreement or the Transactions.
(b) To the knowledge of the Borrower, the facilities and
properties owned, leased or operated by the Borrower and each of its
Subsidiaries (the "Properties") do not contain, and have not previously
contained, any Hazardous Materials in amounts or concentrations or under
circumstances that constitute or constituted a violation of, or could give rise
to liability under, any Environmental Law, except for such violation or
liability that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect..
(c) The environmental audits regarding the real
properties which are part of the Merchant's Acquisition provided to the
Co-Administrative Agent pursuant to Section 4.01(j)
46
do not contain any finding that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.
(d) Except with respect to any matters that, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed
to comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis for
any Environmental Liability.
SECTION 3.07. Compliance with Laws and Agreements. The
Borrower and each Subsidiary is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default
(determined after giving effect to this Agreement) has occurred and is
continuing.
SECTION 3.08. Investment and Holding Company Status. Neither
the Borrower nor any of its Subsidiaries is (a) an "investment company" or a
company "controlled" by an "investment company" as defined in, or subject to
regulation under, the Investment Company Act of 1940 or (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935.
SECTION 3.09. Taxes. The Borrower and each of its Subsidiaries
has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves to the extent required
by GAAP or (b) to the extent that the failure to do so could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all
accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the date of the most recent financial statements reflecting such amounts,
exceed by more than $2,000,000 the fair market value of the assets of such Plan,
and the present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $2,000,000 the
fair market value of the assets of all such underfunded Plans.
SECTION 3.11. Disclosure. The Borrower has disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries, Merchant's, Incorporated or Merban, Inc. is
subject, and all other matters known to it, that, individually or in the
aggregate, could
47
reasonably be expected to result in a Material Adverse Effect. None of the
reports, financial statements, certificates or other information furnished by or
on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) prior to the
Effective Date contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.
SECTION 3.12. Margin Stock. Neither the Borrower nor any
Subsidiary is engaged principally, or as one of its important activities, in the
business of extending or arranging for the extension of credit for the purpose
of purchasing or carrying "margin securities" or "margin Stock" (as defined in
Regulations G and U issued by the Board). Neither the Borrower nor any
Subsidiary owns or intends to carry or purchase any "margin security" or "margin
Stock." Neither the Borrower nor any Subsidiary will use the proceeds of any
Loan to purchase or carry (or refinance any borrowings the proceeds of which
were used to purchase or carry) any "margin security" or "margin Stock." If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.
SECTION 3.13. Compliance with Conditions Precedent. The
Borrower and each Subsidiary has (a) executed and delivered to the
Co-Administrative Agent and the Lenders the documents described in Section 4.01
hereto; (b) obtained and delivered to the Co-Administrative Agent and the
Lenders the opinions of counsel described in Section 4.01 (b); and (c) otherwise
complied with all other conditions hereto.
SECTION 3.14. Labor Matters. There are no strikes, lockouts or
slowdowns against the Borrower or any Subsidiary pending or, to the knowledge of
the Borrower, threatened that could reasonably be expected to have a Material
Adverse Effect.
SECTION 3.15. Assets. Schedule 3.15 accurately describes the
name and registration number of all federally registered trademarks, tradenames
and service marks of the Borrower and its Subsidiaries as of the Effective Date.
SECTION 3.16. Security Documents. (a) The Guarantee and
Collateral Agreement is effective to create in favor of the Collateral Agent,
for the benefit of the Lenders, a legal, valid and enforceable security interest
in the Collateral described therein and proceeds thereof. In the case of the
Pledged Stock described in the Guarantee and Collateral Agreement, when stock
certificates representing such Pledged Stock are delivered to the Collateral
Agent, and in the case of the other Collateral described in the Guarantee and
Collateral Agreement, when financing statements and other filings specified on
Schedule 3.16(a) in appropriate form are filed in the offices specified on
Schedule 3.16(a), the Guarantee and Collateral Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Borrower and the Subsidiaries in such Collateral and the proceeds
thereof, as security for the Obligations (as defined in the Guarantee and
Collateral Agreement), in each case prior and
48
superior in right to any other Person (except, in the case of Collateral other
than Pledged Stock, Liens permitted by Section 6.02).
(b) Each Mortgage is effective to create in favor of the
Collateral Agent, for the benefit of the Lenders, a legal, valid and enforceable
Lien on the Mortgaged Property described therein and proceeds thereof, and when
the Mortgage is filed at the request of the Collateral Agent in the offices
specified on Schedule 3.16(b), each such Mortgage shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Borrower and the Subsidiaries in the Mortgaged Property and the proceeds
thereof, as security for the Secured Indebtedness (as defined in the relevant
Mortgage), in each case prior and superior in right to any other Person.
SECTION 3.17. Solvency. The Borrower is, and after giving
effect to the Acquisition and the incurrence of all Indebtedness and obligations
being incurred in connection herewith and therewith will be and will continue to
be, Solvent.
SECTION 3.18. Certain Documents. The Borrower has delivered to
the Co-Administrative Agent a complete and correct copy of the Merchant's
Acquisition Documentation, including any amendments, supplements or
modifications with respect to any of the foregoing.
SECTION 3.19. Regulation H. No Mortgage encumbers improved
real property that is located in an area that has been identified by the
Secretary of Housing and Urban Development as an area having special flood
hazards and in which flood insurance has been made available under the National
Flood Insurance Act of 1968.
ARTICLE IV
Conditions
SECTION 4.01. Effective Date. The obligations of the Lenders
to make Loans and of each Issuing Bank to issue Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Co-Administrative Agent (or its counsel) shall
have received from each party hereto either (i) a counterpart of this
Agreement signed on behalf of such party or (ii) written evidence
satisfactory to the Co-Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement.
(b) The Co-Administrative Agent shall have received a
favorable written opinion (addressed to the Co-Administrative Agent and
the Lenders and dated the Effective Date) of ▇▇▇▇▇▇▇▇ ▇▇▇▇ LLP, counsel
for the Borrower, and other local counsel for Borrower or any
Subsidiary, substantially in the form of Schedule 4.01(b), and covering
such other matters relating to the Borrower, the Grantors, this
Agreement and the other Loan Documents and the Transactions as the
Required Lenders shall reasonably request. The Borrower hereby requests
such counsel to deliver such opinion.
49
(c) The Co-Administrative Agent shall have received such
documents and certificates as the Co-Administrative Agent or its
counsel may reasonably request relating to the organization, existence
and good standing of the Borrower and the Grantors referred to in
Section 4.01(f), the authorization of the Transactions and any other
legal matters relating to the Borrower, such Grantors, this Agreement
and the other Loan Documents and the Transactions, all in form and
substance satisfactory to the Co-Administrative Agent and its counsel.
(d) The Co-Administrative Agent shall have received a
certificate, dated the Effective Date and signed by the President, a
Vice President or a Financial Officer of the Borrower, confirming
compliance with the conditions set forth in paragraphs (a) and (b) of
Section 4.02.
(e) The Administrative Agent, Book Manager, Lead
Arranger, Co-Administrative Agent and each Lender shall have received
all fees and other amounts due and payable on or prior to the Effective
Date, including, to the extent invoiced, reimbursement or payment of
all out-of-pocket expenses required to be reimbursed or paid by the
Borrower hereunder.
(f) The Co-Administrative Agent shall have received (i)
the Guarantee and Collateral Agreement, executed and delivered by the
Borrower and each Grantor, and (ii) an Intercreditor Agreement executed
and delivered by the Lenders and Prudential.
(g) The Collateral Agent shall have received a Mortgage
on real property owned by the Borrower, located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, and containing an approximately 475,000
square foot executive office and warehouse facility (the "Mortgaged
Property") which Mortgage shall be perfected if requested by the
Collateral Agent.
(h) The Merchant's Acquisition shall have been
consummated on terms and conditions set forth in the Merchant's
Acquisition Documentation.
(i) The Co-Administrative Agent shall have received
satisfactory evidence that the Existing Credit Agreement shall have
been terminated and all amounts owing thereunder shall have been paid
in full.
(j) The Co-Administrative Agent shall have received (i)
copies of all existing environmental audits with respect to the real
properties which are part of the Merchant's Acquisition and any other
Person the acquisition of which is to be financed with proceeds from
the Tranche B Term Loans and (ii) any other existing environmental
audits requested by the Arranger.
(k) The Co-Administrative Agent shall have received the
results of a recent lien search in each of the jurisdictions where
assets of the Borrower and each Subsidiary (including Merchant's,
Incorporated and its subsidiary) are located, and such search shall
reveal no liens on any of the assets of the Borrower except for liens
permitted by Section 6.02 or discharged on or prior to the Closing Date
pursuant to documentation satisfactory to the Administrative Agent.
50
(l) The Collateral Agent shall have received (i) the
certificates representing the shares of Capital Stock pledged pursuant
to the Guarantee and Collateral Agreement, together with an undated
stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof, and (ii) each promissory
note (if any) pledged to the Collateral Agent pursuant to the Guarantee
and Collateral Agreement endorsed (without recourse) in blank (or
accompanied by an executed transfer form in blank) by the pledgor
thereof.
(m) The Borrower and Prudential shall have executed the
Additional Note Agreement in substantially the same form as the most
recent draft thereof distributed to the Lenders.
(n) The Existing Note Agreement between the Borrower and
Prudential shall have been amended in substantially the same form as
the most recent draft of the Note Agreement for the Additional
Prudential Notes distributed to the Lenders.
The Co-Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Banks to issue Letters of Credit hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived pursuant to Section
9.02) at or prior to 3:00 p.m., Memphis, Tennessee time, on April 30, 2003 (and,
in the event such conditions are not so satisfied or waived, the Commitments
shall terminate at such time).
SECTION 4.02. Each Credit Event. The obligation of each Lender
to make a Loan on the occasion of any Borrowing and of each Issuing Bank to
issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:
(a) The representations and warranties of the Borrower
set forth in this Agreement shall be true and correct on and as of the
date of such Borrowing, or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, as if made on such
date.
(b) At the time of and immediately after giving effect to
such Borrowing, or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, no Default shall have occurred
and be continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full, and all Letters
51
of Credit shall have expired or terminated and all LC Disbursements shall have
been reimbursed, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01. Punctual Payment. The Borrower will punctually
pay or cause to be paid the principal and interest due in respect of each
Borrowing according to the terms hereof and the Borrower will punctually pay or
cause to be paid the commitment, Letter of Credit participation and other fees
for which it is responsible pursuant to Section 2.11 hereof.
SECTION 5.02. Financial Statements and Other Information. The
Borrower will furnish to each Lender:
(a) within 90 days after the end of each Fiscal Year of
the Borrower, its audited consolidated balance sheet and related
statement of operations, stockholders' equity and cash flows as of the
end of and for such year, setting forth in each case in comparative
form the figures for the previous Fiscal Year, all reported on by
PricewaterhouseCoopers LLP or other independent public accountants of
recognized national standing (without a "going concern" or like
qualification or exception and without any qualification or exception
as to the scope of such, audit) to the effect that such consolidated
financial statements present fairly in all material respects the
financial condition and results of operations of the Borrower and its
Consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied; and within 90 days after the end of each
Fiscal Year of the Borrower, its unaudited consolidating balance sheets
and related statements of operations as of the end of and for such
year, all certified by one of its Financial Officers as presenting
fairly in all material respects the financial condition and results of
operations of each of the Borrower's Consolidated Subsidiaries in
accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first
three Fiscal Quarters of each Fiscal Year of the Borrower, (i) its
consolidated balance sheets and related statements of operations,
stockholders' equity and cash flows as of the end of and for such
Fiscal Quarter and the then elapsed portion of the Fiscal Year, setting
forth in each case in comparative form the figures for the
corresponding period and quarter of the previous Fiscal Year, and (ii)
its consolidating balance sheets and related statements of operations
as of the end of and for such Fiscal Quarter and the then elapsed
portion of the Fiscal Year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and its
Consolidated Subsidiaries on a consolidated and consolidating basis in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial
statements under clause (a) or (b) above, a certificate of a Financial
Officer of the Borrower (i) certifying as to whether a Default has
occurred and, if a Default has occurred, specifying the details thereof
and any action taken or proposed to be taken with respect thereto, (ii)
setting forth reasonably detailed calculations demonstrating compliance
with Sections 6.08 through 6.12 and (iii) stating whether any change in
GAAP or in the application thereof has occurred since the date of the
audited financial statements referred to in Section 3.04 and, if any
such
52
change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate;
(d) promptly after the same become publicly available,
copies of all periodic and other reports, proxy statements and other
materials filed by the Borrower or any Subsidiary with the Securities
and Exchange Commission, or any Governmental Authority succeeding to
any or all of the functions of said Commission, or with any national
securities exchange, or distributed by the Borrower to its shareholders
generally, as the case may be; and
(e) promptly following any request therefor, such other
information regarding the operations, business affairs and financial
condition of the Borrower or any Subsidiary, or compliance with the
terms of this Agreement and the other Loan Documents, as the
Administrative Agent or any Lender may reasonably request.
SECTION 5.03. Notices of Material Events. The Borrower will
furnish to the Co-Administrative Agent and each Lender prompt written notice of
the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental Authority
against or affecting the Borrower or any Subsidiary or Affiliate
thereof that, if adversely determined, could reasonably be expected to
result in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or
together with any other ERISA Events that have occurred, could
reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $2,000,000; and
(d) any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 5.04. Existence; Conduct of Business. The Borrower
will, and will cause each of its Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.03.
SECTION 5.05. Payment of Obligations. The Borrower will, and
will cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, could result in a Material Adverse Effect before
the same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b)
the Borrower or such Subsidiary has set aside on its books adequate reserves
with respect thereto
53
in accordance with GAAP and (c) the failure to make payment pending such contest
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06. Maintenance of Properties; Insurance. The
Borrower will, and will cause each of its Subsidiaries to, (a) keep and maintain
all property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain, with financially
sound and reputable insurance companies, insurance in such amounts and against
such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.
SECTION 5.07. Books and Records; Inspection Rights. The
Borrower will, and will cause each of its Subsidiaries to, keep proper books of
record and account in which full, true and correct entries are made of all
dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of its Subsidiaries to, permit any
representatives designated by the Co-Administrative Agent or any Lender, upon
reasonable prior notice, to visit and inspect its properties, to examine and
make extracts from its books and records, and to discuss its affairs, finances
and condition with its officers and independent accountants, all at such
reasonable times and as often as reasonably requested.
SECTION 5.08. Compliance with Laws. The Borrower will, and
will cause each of its Subsidiaries to, comply with all laws, rules, regulations
and orders of any Governmental Authority applicable to it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.09. Use of Proceeds. The proceeds of the Term Loans
will be used for the Refinancing, the Merchant's Acquisition and other
Acceptable Acquisitions, and the proceeds of Revolving Loans will be used for
the Refinancing and thereafter for general corporate purposes of the Borrower
and its Subsidiaries. No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations U and X. Letters of Credit will
be used only to support general corporate purposes.
SECTION 5.10. Intercompany Loans/Payments. The Borrower agrees
with the Lenders that (i) any payments made by a Guarantor in reduction of its
obligation under the Guarantee executed by it, shall reduce dollar for dollar
its total obligation to the Borrower for repayment of any Intercompany Loans
owed to the Borrower, (ii) it will require that any payments made by a Guarantor
that is an indirect Wholly-Owned Subsidiary of the Borrower, in reduction of its
obligation under the Guarantee executed by it, shall reduce dollar for dollar
its total obligation for repayment of any Intercompany Loans owed to another
Guarantor and (iii) except as set forth in Schedule 5.10, neither it nor any
Wholly-Owned Subsidiary will demand, enforce or accept any payments on account
of any Intercompany Loans owed to the Borrower by any Guarantor at a time when
such Guarantor is insolvent or if such payments could reasonably be expected to
render such Guarantor insolvent, to leave it with unreasonably small capital for
the business in which it is engaged and in which it intends to engage, or to
leave it unable to pay its other Indebtedness as the same matures.
54
SECTION 5.11. Subsidiary Guarantees and Collateral. (a) With
respect to any new Subsidiary (other than an Excluded Foreign Subsidiary)
created or acquired after the Closing Date by the Borrower or any Subsidiary
(which, for the purposes of this paragraph (a), shall include any existing
Subsidiary that ceases to be an Excluded Foreign Subsidiary), the Borrower will
promptly (i) execute and deliver to the Collateral Agent such amendments to the
Guarantee and Collateral Agreement as the Collateral Agent deems necessary or
advisable to grant to the Collateral Agent, for the benefit of the Lenders, a
perfected first priority security interest in the Capital Stock of such new
Subsidiary that is owned by the Borrower or any Subsidiary, (ii) deliver to the
Collateral Agent the certificates representing such Capital Stock, together with
undated stock powers, in blank, executed and delivered by a duly authorized
officer of the Borrower or the relevant Subsidiary, (iii) cause such new
Subsidiary (A) to become a party to the Guarantee and Collateral Agreement and
(B) to take such actions necessary or advisable to grant to the Collateral Agent
for the benefit of the Lenders a perfected first priority security interest in
the Collateral described in the Guarantee and Collateral Agreement with respect
to such new Subsidiary, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be requested by the Collateral
Agent, and (iv) if requested by the Collateral Agent, deliver to the Collateral
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Collateral Agent.
(b) With respect to any new Excluded Foreign Subsidiary
created or acquired after the Closing Date by the Borrower or any Subsidiary
(other than by any Subsidiary that is an Excluded Foreign Subsidiary), the
Borrower will promptly (i) execute and deliver to the Collateral Agent such
amendments to the Guarantee and Collateral Agreement as the Collateral Agent
deems necessary or advisable to grant to the Collateral Agent, for the benefit
of the Lenders, a perfected first priority security interest in the Capital
Stock of such new Subsidiary that is owned by the Borrower or such Subsidiary
(provided that in no event shall more than 66% of the total outstanding voting
Capital Stock of any such new Subsidiary be required to be so pledged), (ii)
deliver to the Collateral Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a
duly authorized officer of the Borrower or the relevant Subsidiary, and take
such other action as may be necessary or, in the opinion of the Collateral
Agent, desirable to perfect the Collateral Agent's security interest therein,
and (iii) if requested by the Collateral Agent, deliver to the Collateral Agent
legal opinions relating to the matters described above, which opinions shall be
in form and substance, and from counsel, reasonably satisfactory to the
Collateral Agent.
SECTION 5.12. Environmental Laws. (a) The Borrower will, and
will cause each of its Subsidiaries to, comply in all material respects with,
and ensure compliance in all material respects by all tenants and subtenants, if
any, with, all applicable Environmental Laws, and obtain and comply in all
material respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, except where the failure to do so, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.
55
(b) The Borrower will, and will cause each of its
Subsidiaries to, conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.13. Additional Collateral, etc. (a) With respect
to any fee interest in any real property having a value (together with
improvements thereof) of at least $10,000,000 acquired after the Closing Date by
the Borrower or any of its Subsidiaries (other than any such real property
subject to a Lien expressly permitted by Section 6.02(d)), if requested by the
Collateral Agent, the Borrower shall, or shall cause its Subsidiary to, promptly
(i) execute and deliver a first priority Mortgage, in favor of the Collateral
Agent, for the benefit of the Lenders, covering such real property, (ii) provide
the Lenders with (x) title and extended coverage insurance covering such real
property in an amount at least equal to the purchase price of such real property
(or such other amount as shall be reasonably specified by the Collateral Agent)
as well as a current ALTA survey thereof, together with a surveyor's certificate
and (y) any consents or estoppels reasonably deemed necessary or advisable by
the Collateral Agent in connection with such Mortgage, each of the foregoing in
form and substance reasonably satisfactory to the Collateral Agent and (iii)
deliver to the Collateral Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Collateral Agent.
(b) With respect to any property acquired after the
Closing Date by any of the Borrower or its Subsidiaries (other than (x) any
property described in paragraph (a) or Section 5.11, (y) any property subject to
a Lien expressly permitted by Section 6.02(d) and (z) properly acquired by any
Excluded Foreign Subsidiary) as to which the Collateral Agent, for the benefit
of the Lenders, does not have a perfected Lien, if requested by the Collateral
Agent, the Borrower shall promptly (i) execute and deliver to the Collateral
Agent such amendments to the Guarantee and Collateral Agreement or such other
documents as the Collateral Agent deems necessary or advisable to grant to the
Collateral Agent, for the benefit of the Lenders, a security interest in such
property and (ii) take all actions necessary or advisable to grant to the
Collateral Agent, for the benefit of the Lenders, a perfected first priority
security interest in such property, including the filing of Uniform Commercial
Code financing statements in such jurisdictions as may be required by the
Guarantee and Collateral Agreement or by law or as may be requested by the
Collateral Agent.
SECTION 5.14. Title Insurance, etc. (a) If requested by the
Collateral Agent, the Borrower will provide to the Collateral Agent and the
title insurance company issuing the policy referred to in paragraph (b) below
(the "Title Insurance Company") maps or plats of an as-built survey of the sites
of the Mortgaged Properties, and such maps or plats shall be certified to the
Collateral Agent and the Title Insurance Company in a manner satisfactory to
them, dated a date satisfactory to the Collateral Agent and the Title Insurance
Company by an independent professional licensed land surveyor satisfactory to
the Collateral Agent and the Title Insurance Company, which maps or plats and
the surveys on which they are based shall be made in accordance with the Minimum
Standard Detail Requirements for Land Title Surveys jointly established and
adopted by the American Land Title Association and the American Congress on
56
Surveying and Mapping in 1992, and, without limiting the generality of the
foregoing, there shall be surveyed and shown on such maps, plats or surveys the
following: (A) the locations on such sites of all the buildings, structures and
other improvements and the established building setback lines; (B) the lines of
streets abutting the sites and width thereof; (C) all access and other easements
appurtenant to the sites; (D) all roadways, paths, driveways, easements,
encroachments and overhanging projections and similar encumbrances affecting the
site, whether recorded, apparent from a physical inspection of the sites or
otherwise known to the surveyor; (E) any encroachments on any adjoining property
by the building structures and improvements on the sites; (F) if the site is
described as being on a filed map, a legend relating the survey to said map; and
(G) the flood zone designations, if any, in which any Mortgaged Property is
located.
(b) If requested by the Collateral Agent, the Borrower
will provide to the Collateral Agent in respect of each Mortgaged Property a
mortgagee's title insurance policy (or policies) or marked up unconditional
binder for such insurance. Each such policy shall (A) be in an amount
satisfactory to the Collateral Agent; (B) be issued at ordinary rates; (C)
insure that the Mortgage insured thereby creates a valid first Lien on such
Property free and clear of all defects and encumbrances, except as disclosed
therein; (D) name the Collateral Agent for the benefit of the Lenders as the
insured thereunder; (E) be in the form of ALTA Loan Policy - 1970 (Amended
10/17/70 and 10/17/84) (or equivalent policies); (F) contain such endorsements
and affirmative coverage as the Collateral Agent may reasonably request and (G)
be issued by title companies satisfactory to the Collateral Agent (including any
such title companies acting as co-insurers or reinsurers, at the option of the
Collateral Agent). The Collateral Agent shall have received evidence
satisfactory to it that all premiums in respect of each such policy, all charges
for mortgage recording tax, and all related expenses, if any, have been paid.
(c) If requested by the Collateral Agent, the Borrower
will provide to the Collateral Agent (A) a policy of flood insurance that (1)
covers any parcel of improved real property that is encumbered by any Mortgage
(2) is written in an amount not less than the outstanding principal amount of
the indebtedness secured by such Mortgage that is reasonably allocable to such
real property or the maximum limit of coverage made available with respect to
the particular type of property under the National Flood Insurance Act of 1968,
whichever is less, and (3) has a term ending not later than the maturity of the
Indebtedness secured by such Mortgage and (B) confirmation that the Borrower has
received the notice required pursuant to Section 208(e)(3) of Regulation H of
the Board.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the
principal of and interest on each Loan and all fees payable hereunder have been
paid in full, and all Letters of Credit have expired or been terminated and all
LC Disbursements shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:
SECTION 6.01. Indebtedness. The Borrower will not, nor will it
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, except:
57
(a) Indebtedness created hereunder, and Guarantees
executed pursuant to this Agreement;
(b) Indebtedness and Guarantees existing on the date
hereof and set forth in Schedule 6.01 and extensions, renewals and
replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof over the amount set forth on
Schedule 6.01;
(c) Indebtedness owed to the Borrower or to any
Wholly-Owned Subsidiary by any Wholly-Owned Subsidiary, that in each
case is permitted under Sections 6.04(c), and Indebtedness owed by the
Borrower or by any Wholly-Owned Subsidiary to any Wholly-Owned
Subsidiary, that in each case is permitted under Section 6.04(h);
(d) Guarantees and Indebtedness arising in connection
with any Synthetic Lease, in an aggregate principal amount not
exceeding $9,000,000 or in connection with the SunTrust Sale and
Leaseback in an aggregate principal amount not exceeding $12,000,000;
(e) Guarantee obligations entered into by Big O Tires,
Inc. or its Subsidiaries on behalf of its franchisees, other than
Guarantees related to any Synthetic Lease and those existing Guarantee
obligations listed on Schedule 6.01(e), provided that the aggregate
principal amount of such guaranteed obligations arising after the
Effective Date plus the aggregate principal amount of loans permitted
under Section 6.04(i) at no time exceeds $20,000,000;
(f) Indebtedness of any Subsidiary which becomes such as
a result of an Acceptable Acquisition, including such Indebtedness that
is assumed or becomes the subject of a Guarantee, but not any
extensions, renewals or replacements thereof; provided, that any such
Indebtedness is not created in contemplation of or in connection with
such Acceptable Acquisition;
(g) Guarantees by any of the Borrower or any Wholly-Owned
Subsidiary of Indebtedness of any Wholly-Owned Subsidiary, provided
such Subsidiary Indebtedness is permitted pursuant to this Section;
(h) other Indebtedness which does not have an aggregate
principal amount exceeding $25,000,000 at any time outstanding;
(i) Guarantee obligations entered into by (x) the
Borrower or any Wholly-Owned Subsidiary, of obligations of any
Wholly-Owned Subsidiary to Persons other than their Affiliates, which
obligations are incurred by them in the ordinary course of business and
do not constitute Indebtedness, such as trade accounts payable,
customer advances, accrued expenses and lease payments that do not
constitute Indebtedness, and (y) the Borrower or any Wholly-Owned
Subsidiary, of obligations of Persons other than Subsidiaries and their
Affiliates, provided that the aggregate principal amount of the
guaranteed obligations under this clause (y) plus the aggregate amount
of the investments permitted under Section 6.04(d) at no time exceeds
$20,000,000; and
58
(j) Indebtedness owed by the Borrower to the sellers of
Merchant's, Incorporated and its subsidiary evidenced by the promissory
note pursuant to Section 3.03(a)(i) of the Merchant's Acquisition
Agreement, provided that the proceeds from the Additional Prudential
Notes shall be used to pay off the Indebtedness under such promissory
note 15 days after the closing date of the Merchant's Acquisition.
SECTION 6.02. Liens. The Borrower will not, nor will it permit
any of its Subsidiaries to, create, incur, assume or permit to exist any Lien on
any property or asset now owned or hereafter acquired by it, or assign or sell
any income or revenues (including accounts receivable) or rights in respect of
any thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower or
any Subsidiary existing on the date hereof and set forth in Schedule
6.02, provided that , if such Lien is not released within sixty days
after the Effective Date, (i) such Lien shall not apply to any other
property or asset of the Borrower or any Subsidiary and (ii) such Lien
shall secure only those obligations which it secures on the date hereof
and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof over the amount set forth on
Schedule 6.02;
(c) any Lien, other than a Lien securing a Synthetic
Lease permitted under Section 6.01(d), existing on any property or
asset prior to the acquisition thereof by the Borrower or any
Subsidiary or existing on any property or asset of any Person that
becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary; provided that (i) such Lien is not created
in contemplation of or in connection with such acquisition or such
Person becoming a Subsidiary, as the case may be, (ii) such Lien shall
not apply to any other property or assets of the Borrower or any
Subsidiary; (iii) such Lien secures Indebtedness permitted by Section
6.01(h) and (iv) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes
a Subsidiary, as the case may be;
(d) Liens, other than Liens securing any Synthetic Lease
permitted under Section 6.01(d), on fixed or capital assets acquired by
the Borrower or any Subsidiary; provided that (i) such Liens secure
Indebtedness permitted by Section 6.01(h), (ii) such Liens and the
Indebtedness secured thereby are incurred prior to such acquisition or
simultaneously therewith, (iii) the Indebtedness secured thereby does
not exceed 100% of the cost of acquiring such fixed or capital assets,
(iv) such security interests shall not apply to any other property or
assets of the Borrower or any Subsidiary; and (v) the aggregate
Indebtedness secured by all such Liens does not exceed $5,000,000;
(e) Liens securing any Synthetic Lease or arising in
connection with the SunTrust Sale and Leaseback permitted under Section
6.01(d); and
(f) a security interest granted by Tire Kingdom, Inc. to
Michelin Tire Corporation, as secured party, with respect to all
inventory previously and hereafter purchased from Michelin Tire
Corporation by Tire Kingdom, Inc. and all proceeds
59
thereof, provided that the aggregate amount of obligations secured
thereby at no time exceeds $30,000,000.
SECTION 6.03. Fundamental Changes. (a) The Borrower will not,
nor will it permit any of its Subsidiaries to, merge into or with or consolidate
with any other Person, or permit any other Person to merge into or with it or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) any of the stock of its Subsidiaries
(in each case, whether now owned or hereafter acquired), or liquidate or
dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Default shall have occurred and be continuing (i) any
Wholly-Owned Subsidiary may merge into the Borrower or into another Wholly-Owned
Subsidiary; (ii) any Wholly-Owned Subsidiary may sell, transfer, lease or
otherwise dispose of any portion of its assets to the Borrower or to another
Wholly-Owned Subsidiary; (iii) any Wholly-Owned Subsidiary may liquidate or
dissolve if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders; (iv) Acceptable Acquisitions shall be permitted;
and (v) the disposal of Northern States Tire, Inc. shall be permitted, whether
by sale of assets or stock, or by merger or consolidation.
(b) The Borrower will not, nor will it permit any of its
Subsidiaries to, engage to any material extent in any business not reasonably
related to (i) the distribution of tires and other products in the automotive
replacement market, (ii) providing financing to the Borrower and its other
Subsidiaries, or (iii) owning and licensing intellectual property used by the
Borrower or its other Subsidiaries.
SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, nor will it permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a Wholly-Owned Subsidiary prior to such merger) any capital stock,
evidences of Indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets of
any other Person constituting a business unit, except:
(a) Permitted Investments;
(b) the Merchant's Acquisition; capital investments in
any Subsidiary (provided that the Subsidiary is in existence on the Effective
Date or becomes a Subsidiary at any time after the Effective Date in a manner
which complies with all other provisions of this Agreement without giving effect
to this clause (b)); and other investments and loans as otherwise described in
Schedule 6.04(b);
(c) loans or advances made by the Borrower or any
Wholly-Owned Subsidiary to any Wholly-Owned Subsidiary;
(d) loans and advances to, purchases of equity interests
in and contributions to the capital of Joint Ventures and other Persons, not
otherwise permitted pursuant to this Section, provided that the aggregate amount
of such investments, plus the aggregate amount of the
60
obligations guaranteed pursuant to Section 6.01(i)(y), shall not exceed
$20,000,000 at any one time; (Joint Venture profits and losses that are passed
through to its equity holders shall not be included in the calculation of the
aggregate amount of such investments);
(e) investments in evidences of Indebtedness representing
amounts formerly constituting accounts receivable owed to the Borrower or any
Subsidiary in the ordinary course of business;
(f) Guarantees permitted under Section 6.01;
(g) Acceptable Acquisitions. "Acceptable Acquisition"
means any separate individual Acquisition completed after the date of this
Agreement which has been either (a) approved by the Board of Directors of the
corporation, or the comparable or appropriate body of any other Person, which is
the subject of such Acquisition or (b) recommended by such Board to the
shareholders of such corporation, or by such other body to the equity holders of
such other Person, and in each case (i) the Acquisition target is a Person which
is engaged in the replacement tire industry, (ii) the aggregate consideration
for the Acquisitions shall not exceed $40,000,000 in any one calendar year,
(iii) the aggregate consideration for all Acquisitions completed after the date
of this Agreement shall not exceed $75,000,000, provided that this amount shall
be increased on an annual basis by 25% of the Borrower's Consolidated Net Income
for each completed fiscal year commencing with its 2003 fiscal year and (iv) the
Acquisition is made under circumstances in which no Default or Event of Default
will either exist or result therefrom, and in which pro forma financial
statements and projections including the Borrower, its Subsidiaries and the
Person and/or assets to be acquired, covering the most recent 12 month period
for which financial statements are available and the twelve months following the
Acquisition, would show that no Default or Event of Default will result from the
Acquisition and that Borrower will have unused Revolving Credit Commitments upon
consummation of such Acquisition aggregating not less than $20,000,000. As used
in this paragraph, "Acquisition" means any transaction pursuant to which the
Borrower or any of its Wholly-Owned Subsidiaries (a) acquires all of the
outstanding equity securities of any Person other than the Borrower or any
Person which is then a Wholly-Owned Subsidiary of the Borrower, or (b) otherwise
makes any Person a Wholly-Owned Subsidiary of the Borrower, in any case pursuant
to a merger, purchase of assets or any reorganization, or (c) purchases all or
substantially all of the business or assets of any Person other than a
Wholly-Owned Subsidiary of the Borrower or of any business unit or line of
business of any such Persons;
(h) Intercompany Loans made to the Borrower or any
Wholly-Owned Subsidiary by any Wholly-Owned Subsidiary; and
(i) loans by Big O Tires, Inc. or its Wholly-Owned
Subsidiaries to Big O franchisees, provided that the aggregate principal amount
of such loans arising after the Effective Date plus the aggregate amount of the
obligations guaranteed pursuant to Section 6.01(e) at no time exceeds
$20,000,000. Investments in evidences of Indebtedness permitted under Section
6.04(e) and Big O franchisee loans that have been sold to third parties shall be
excluded from the loans and obligations required to be within the $20,000,000
limit.
61
SECTION 6.05. Hedging Agreements. The Borrower will not, nor
will it permit any of its Subsidiaries to, enter into any Hedging Agreement,
other than Hedging Agreements entered into in the ordinary course of business to
hedge or mitigate risks to which the Borrower or such Subsidiary is exposed in
the conduct of its business or the management of its liabilities.
SECTION 6.06. Transactions with Affiliates. The Borrower will
not, nor will it permit any of its Subsidiaries to, enter into any transaction
(including, without limitation, the purchase or sale of any property or service)
with or make any payment or transfer to, any of its Affiliates except in the
ordinary course of business and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction; provided that
the foregoing shall not apply to transactions (i) between the Borrower and any
Wholly-Owned Subsidiary, as long as such transactions do not violate Section
6.04; or (ii) if such transactions occur in the ordinary course of business
consistent with past practices of the Borrower and/or Subsidiary, (x)
transactions between the Borrower or any Wholly-Owned Subsidiary and TBC de
Mexico or (xx) transactions between Big O Tires, Inc. or any of its Subsidiaries
and any Joint Venture established by Big O Tires, Inc. or any of its
Subsidiaries in the ordinary course of business, the entire investment in which
is permitted under Section 6.04(d).
SECTION 6.07. Restrictive Agreements. The Borrower will not,
nor will it permit any of its Subsidiaries to, directly or indirectly, enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of the
Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any
of its property or assets, or (b) the ability of any Subsidiary to pay dividends
or other distributions with respect to any shares of its capital stock or to
make or repay loans or advances to the Borrower or any other Subsidiary or to
Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by this Agreement, (ii) the foregoing shall not apply to restrictions and
conditions identified on Schedule 6.07 (but shall apply to any extension or
renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale, provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.
SECTION 6.08. Fixed Charge Coverage Ratio. The Borrower will
not permit the Fixed Charge Coverage Ratio as of the last day of any Fiscal
Quarter of the Borrower to be less than the amount set forth in the following
table. For purposes of this Section, "Fixed Charge Coverage Ratio" means as of
the last day of any Fiscal Quarter of the Borrower, the ratio of (a) EBITDA for
the period of four Fiscal Quarters ending on the last day of such quarter to (b)
the sum of the Consolidated Interest Expense, Scheduled Payments and Capital
Expenditures for such period:
62
Quarter Ending Ratio
-------------- -----
6/30/03 1.15:1
9/30/03 1.15:1
12/31/03 1.15:1
3/31/04 1.15:1
6/30/04 1.15:1
9/30/04 1.25:1
12/31/04 1.25:1
3/31/05 1.25:1
6/30/05 1.25:1
9/30/05 1.50:1
12/31/05 1.50:1
3/31/06 1.50:1
6/30/06 1.50:1
9/30/06 1.50:1
12/31/06 1.50:1
3/31/07 1.50:1
6/30/07 1.50:1
9/30/07 1.50:1
12/31/07 1.50:1
SECTION 6.09. Maximum Leverage Ratio. The Borrower will not
permit the Leverage Ratio as of the end of any Fiscal Quarter to be greater than
that set forth in the following table:
Quarter Ending Ratio
-------------- -----
6/30/03 3.25:1
9/30/03 3.25:1
12/31/03 3.25:1
3/31/04 3.00:1
6/30/04 3.00:1
9/30/04 2.75:1
12/31/04 2.75:1
3/31/05 2.50:1
6/30/05 2.50:1
9/30/05 2.50:1
12/31/05 2.50:1
3/31/06 2.25:1
6/30/06 2.25:1
9/30/06 2.25:1
12/31/06 2.25:1
3/31/07 2.25:1
6/30/07 2.25:1
9/30/07 2.25:1
12/31/07 2.25:1
63
SECTION 6.10. Adjusted Debt to EBITDAR. The Borrower will not
permit the ratio of (i) Adjusted Debt to (ii) EBITDAR at the end of any Fiscal
Quarter to be greater than the amount set forth in the following table:
Quarter Ending Ratio
-------------- -----
6/30/03 5.25:1
9/30/03 5.25:1
12/31/03 5.25:1
3/31/04 5.00:1
6/30/04 5.00:1
9/30/04 5.00:1
12/31/04 5.00:1
3/31/05 4.75:1
6/30/05 4.75:1
9/30/05 4.50:1
12/31/05 4.50:1
3/31/06 4.50:1
6/30/06 4.50:1
9/30/06 4.25:1
12/31/06 4.25:1
3/31/07 4.25:1
6/30/07 4.25:1
9/30/07 4.00:1
12/31/07 4.00:1
For purposes of this Section, at the end of any Fiscal Quarter, (i) "Adjusted
Debt" shall mean Consolidated Funded Indebtedness as of the end such Fiscal
Quarter, plus eight times the rental payments made (net of any sublease income)
during the four Fiscal Quarter period then ended, and (ii) EBITDAR shall mean
the aggregate EBITDA, plus the aggregate rental payments (net of any sublease
income), for the four Fiscal Quarter period then ended.
SECTION 6.11. Asset Test. The Borrower will not permit the
ratio of the sum of its consolidated accounts receivable and inventories subject
to a first priority perfected security interest in favor of the Collateral Agent
pursuant to the Guarantee and Collateral Agreement (and, in any event, exclusive
of any then outstanding amounts secured by a security interest on inventory
permitted by Section 6.02(f)) to Consolidated Funded Indebtedness at the end of
any Fiscal Quarter to be less than 1.35 to 1.
SECTION 6.12. Disclosure. None of the reports, financial
statements, certificates or other information furnished by or on behalf of the
Borrower to the Administrative Agent or any Lender pursuant to this Agreement or
any of the other Loan Documents will, when so furnished, contain any material
misstatement of fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading; provided that, with respect to projected financial information, such
information may be prepared in good faith based upon assumptions believed to be
reasonable at the time.
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SECTION 6.13. Sale of Assets. The Borrower will not sell,
lease, assign, transfer or otherwise dispose of, or permit any of its
Subsidiaries to sell, lease, assign, transfer or otherwise dispose of, any of
its or their now owned or hereafter acquired assets (including, without
limitation, shares of stock and indebtedness of such Subsidiaries, receivables
and leasehold interests), except: (a) for inventory disposed of in the ordinary
course of business; (b) for transactions with Affiliates permitted under Section
6.06; (c) for the sale or other disposition of assets that are obsolete or no
longer used or usable for the conduct of business in the ordinary course; (d)
for one or more transactions in which fixed or capital assets are sold and
leased back, on terms that do not constitute Capital Lease Obligations (other
than the SunTrust Sale and Leaseback and any transaction described in clause (e)
below), provided that if the aggregate sale price of the assets sold exceeds
$5,000,000, the Net Proceeds of each such sale are used to prepay principal of
the Term Loans, of the Prudential Debt and of the Additional Prudential Notes,
pursuant to Section 2.10(c); (e) that Big O Tires, Inc. and its Subsidiaries
shall be permitted (i) to sell Big O franchisee loans to third parties, and (ii)
to sell to Big O franchisees, or to sell and leaseback for subleasing to Big O
franchisees, Big O stores (including real estate, fixtures and equipment),
provided that, in each case under clauses (i) and (ii) the transaction is in the
ordinary course of business and consistent with past practice; (f) for sales
described in Schedule 6.13; and (g) for the SunTrust Sale and Leaseback.
SECTION 6.14. Restricted Payments. The Borrower will not, and
will not permit any of its Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except (a) the Borrower
may declare and pay dividends with respect to its capital stock payable solely
in additional shares of its common stock, (b) Subsidiaries may declare and pay
dividends ratably with respect to their capital stock or other equity interest,
(c) the Borrower may make Restricted Payments pursuant to and in accordance with
stock option plans or other benefits for management or employees of the Borrower
and its Subsidiaries and (d) so long as no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower may make
payments in an aggregate amount not exceeding $10,000,000 per calendar year on
account of (i) the purchase, redemption, retirement, acquisition, cancellation
or termination of any shares of capital stock of the Borrower or any option,
warrant or other right to acquire any such shares and (ii) the payment of
dividends with respect to its preferred stock.
ARTICLE VII
Events of Default
If any of the following events ("Events of Default") shall
occur:
(a) the Borrower shall fail to pay any principal of any
Loan or any reimbursement obligation in respect of any LC Disbursement
when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any
Loan or any fee or any other amount (other than an amount referred to
in clause (a) of this Article) payable under
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this Agreement or any other Loan Document when and as the same shall
become due and payable, and such failure shall continue unremedied for
a period of three days;
(c) any representation or warranty made or deemed made by
or on behalf of the Borrower or any Subsidiary in or in connection with
this Agreement or any other Loan Document or any amendment or
modification hereof or thereof, or waiver hereunder or thereunder, or
in any report, certificate, financial statement or other document
furnished pursuant to or in connection with this Agreement or any other
Loan Document or any amendment or modification hereof or thereof or
waiver hereunder or thereunder, shall prove to have been materially
incorrect when made or deemed made;
(d) (i) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in Section 5.03, 5.04 (with
respect to the Borrower's existence) or 5.08, or (ii) the Borrower
shall fail to observe or perform any covenant or agreement contained in
Article VI, and in each case in clauses (i) and (ii), either (x) such
failure is not remedied within two Business Days after any of the Chief
Executive Officer of the Borrower or any Financial Officer obtains
knowledge thereof or (xx) within such two-day period, the Required
Lenders, or the Co-Administrative Agent on instructions of the Required
Lenders, gives the Borrower notice that such failure constitutes a
Default;
(e) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in this Agreement (other
than those specified in clauses (a), (b), (c) or (d) of this Article),
and such failure shall continue unremedied for a period of 30 days
after the earlier to occur of (i) the date the Borrower shall have
obtained knowledge thereof and (ii) written notice thereof from the
Co-Administrative Agent to the Borrower (which notice will be given at
the request of any Lender);
(f) the Borrower or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become
due and payable;
(g) any event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled maturity or
that enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled
maturity; provided that this clause (g) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Borrower or any
Subsidiary or its debts, or of a substantial part of its assets, under
any Federal, state or foreign bankruptcy, insolvency, receivership or
similar law now or hereafter in effect or (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Subsidiary or for a substantial part
of its assets, and, in any such case, such proceeding or petition shall
continue
66
undismissed for 60 days or an order or decree approving or ordering any
of the foregoing shall be entered;
(i) the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or petition described in
clause (h) of this Article, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Subsidiary or
for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors
or (vi) take any action for the purpose of effecting any of the
foregoing;
(j) the Borrower shall become unable, admit in writing
its inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an
aggregate amount in excess of $3,000,000 shall be rendered against the
Borrower, any Subsidiary or any combination thereof and the same shall
remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be
legally taken by a judgment creditor to attach or levy upon any assets
of the Borrower or any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the
opinion of the Required Lenders, when taken together with all other
ERISA Events that have occurred, could reasonably be expected to result
in liability of the Borrower and its Subsidiaries in an aggregate
amount exceeding $2,000,000;
(m) a Change in Control shall occur;
(n) the Borrower or any Subsidiary shall be subject to
any Environmental Liability or the subject of any proceeding or
investigation pertaining to the release by the Borrower or any
Subsidiary, or any other Person of any Hazardous Material into the
environment, or pertaining to any violation of any Environmental Law,
which, in any case, could reasonably be expected to have a Material
Adverse Effect; or
(o) the Guarantee and Collateral Agreement, the guarantee
contained in Section 2 of the Guarantee and Collateral Agreement or any
Mortgage shall for any reason cease to be an enforceable obligation of
the Borrower or any Grantor, as the case may be, that executed the same
or if such party or any other Person should contest the validity of
such guarantee, the Guarantee and Collateral Agreement or Mortgage or
shall seek in any way to have it declared null and void or to have such
party's obligations thereunder in any way limited, or if such party
shall in any respect not described elsewhere in this Article fail to
perform any of its obligations under such Guarantee and Collateral
Agreement or any Mortgage, and such failure shall continue unremedied
for a period of fifteen days after the earlier to occur of (i) the date
the Borrower shall have
67
obtained knowledge thereof or (ii) written notice thereof from the
Collateral Agent to the Borrower (which notice will be given at the
request of any Lender);
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Co-Administrative Agent shall,
pursuant to the request of the Required Lenders, by notice to the Borrower, take
either or both of the following actions, at the same or different times: (i)
terminate the Revolving Credit Commitments, and thereupon the Revolving Credit
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent and the Co-Administrative Agent
Each of the Lenders and the Issuing Banks hereby irrevocably
appoints each of the Administrative Agent and the Co-Administrative Agent as its
agent under this Agreement and the other Loan Documents, and authorizes the
Administrative Agent and the Co-Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated respectively to the
Administrative Agent and the Co-Administrative Agent by the terms hereof and of
the other Loan Documents together with such actions and powers as are reasonably
incidental thereto.
Each bank serving as the Administrative Agent and the
Co-Administrative Agent hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it
were not the Administrative Agent or the Co-Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent or the Co-Administrative
Agent hereunder.
Neither the Administrative Agent nor the Co-Administrative
Agent shall have any duties or obligations except those expressly set forth
herein and in the other Loan Documents. Without limiting the generality of the
foregoing, (a) neither shall be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing, (b)
neither shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby and in the other Loan Documents that the Administrative
Agent or the Co-Administrative Agent is required to exercise in writing
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by the Required Lenders (or such other number or percentage of the Lenders as
shall be necessary under the circumstances as provided in Section 9.02), and (c)
except as expressly set forth herein, neither the Administrative Agent nor the
Co-Administrative Agent shall have any duty to disclose, nor shall it be liable
for the failure to disclose, any information relating to the Borrower or any of
the Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or Co-Administrative Agent, as the case may be, or any of
its respective Affiliates in any capacity. Neither the Administrative Agent nor
the Co-Administrative Agent shall be liable for any action taken or not taken by
it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or for any action taken or not taken
by it in the absence of its own gross negligence or wilful misconduct. Neither
the Administrative Agent nor the Co-Administrative Agent shall be deemed to have
knowledge of any Default (including any event of default under any other Loan
Document) unless and until written notice thereof is given to it by the Borrower
or a Lender, and neither the Administrative Agent nor the Co-Administrative
Agent shall be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein,
(iv) the validity, enforceability, effectiveness or genuineness of this
Agreement or any other Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article IV or
elsewhere herein or in any other Loan Document other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent or the
Co-Administrative Agent, as the case may be.
The Administrative Agent and the Co-Administrative Agent shall
be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or
other writing believed by it to be genuine and to have been signed or sent by
the proper Person. Each of the Administrative Agent and the Co-Administrative
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. Each of the Administrative Agent and the
Co-Administrative Agent may consult with legal counsel (who may be counsel for
the Borrower), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.
Each of the Administrative Agent and the Co-Administrative
Agent may perform any and all its duties and exercise its rights and powers by
or through any one or more sub-agents appointed by it. The Administrative Agent
and the Co-Administrative Agent and any such sub-agent may perform any and all
duties and exercise rights and powers through their respective Related Parties.
The exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of the Administrative Agent and the
Co-Administrative Agent, and any such sub-agent.
Upon the appointment and acceptance of a successor
Administrative Agent or Co-Administrative Agent as provided in this paragraph,
the Administrative Agent or Co-Administrative Agent may resign at any time by
notifying the Lenders, the Issuing Bank and the
69
Borrower. Upon any such resignation, the Required Lenders shall have the right,
with the approval of the Borrower (provided Borrower's approval shall not be
required during the existence of a Default), to appoint a successor. If no
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative Agent
or Co-Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent or Co-Administrative Agent may, on behalf of the Lenders
and the Issuing Bank, appoint a successor Administrative Agent or
Co-Administrative Agent, which shall be a bank with an office in the United
States, or an Affiliate of any such bank. Upon the acceptance of its appointment
as Administrative Agent or Co-Administrative Agent hereunder and under the other
Loan Documents by a successor, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent or Co-Administrative Agent, and the retiring Administrative
Agent or Co-Administrative Agent shall be discharged from any further duties and
obligations hereunder and under the other Loan Documents. The fees payable by
the Borrower to a successor Administrative Agent or Co-Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent's or
Co-Administrative Agent's resignation hereunder, the provisions of this Article
and Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent or Co-Administrative Agent, its sub agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while acting as Administrative Agent or Co-Administrative
Agent, as the case may be.
Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent, the Co-Administrative Agent, or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent, the Co-Administrative Agent or any other
Lender and based on such documents and information as it shall from time to time
deem appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of Chief Financial Officer, (Fax
No. (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Administrative Agent, to National
Department, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of
Manager, National Department (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇);
70
(c) if to any Issuing Bank, to First Tennessee Bank
National Association at National Department, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇, Senior Vice
President (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇) and to JPMorgan Chase Bank at
Corporate Banking Department, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇, Vice President (Fax No.
(▇▇▇) ▇▇▇-▇▇▇▇);
(d) if to the Swingline Lender, to it at National
Department, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of
Manager, National Department (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇);
(e) if to the Co-Administrative Agent, to it at it at
Corporate Banking Department, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇, Vice President (Fax No.
(▇▇▇) ▇▇▇-▇▇▇▇);
(f) if to any other Lender, to it at its address (or
telecopy number) set forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by
the Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender in exercising any right or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks and the Lenders hereunder are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given. Without limiting the generality of the foregoing, the making of
a Loan or issuance of a Letter of Credit shall not be construed as a waiver of
any Default, regardless of whether the Administrative Agent, the
Co-Administrative Agent, any Lender or any Issuing Bank may have had notice or
knowledge of such Default at the time.
(b) Neither this Agreement, any Loan Document nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Borrower and the
Required Lenders or by the Borrower and the Co-Administrative Agent with the
consent of the Required Lenders; provided that no such agreement shall (i)
increase the Commitment of any Lender without the written consent of such
Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce any fees payable hereunder, or
waive or release the obligation of the Borrower with respect to any such
principal, interest, fees, or LC Disbursement without the written consent of
each Lender affected thereby, (iii) postpone the scheduled date of payment of
71
the principal amount of any Loan or LC Disbursement, or any interest thereon, or
any fees payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender affected thereby, (iv) change Section 2.17(b)
or (c) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) change any of the
provisions of this Section or the definition of "Required Lenders" or any other
provision hereof specifying the number or percentage of Lenders required to
waive, amend or modify any rights hereunder or make any determination or grant
any consent hereunder, without the written consent of each Lender, or (vi)
waive, amend or modify any of the provisions of Article VIII or, except as
provided in Section 4(a) of the Intercreditor Agreement, release any of the
Collateral or release all or substantially all of the Guarantors from their
obligations under the Collateral Agreement, without the written consent of all
Lenders; provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks or the Swingline Lender hereunder
without the prior written consent of the Administrative Agent, the
Co-Administrative Agent, the Issuing Banks or the Swingline Lender, as the case
may be.
(c) Should the Borrower or any Guarantor become a party
to a case under the United States Bankruptcy Code, each Lender shall be entitled
to file its own claim, to the extent that a filing may be necessary. The
Co-Administrative Agent shall review each claim before being filed by a Lender
to assure that the claim is filed on a basis consistent with the Administrative
Agent's and the Co-Administrative Agent's records and the legal position, if
any, taken by the Administrative Agent or the Co-Administrative Agent on behalf
of the Lenders pursuant to this Agreement. Should the Borrower or any Guarantor
become a party to a reorganization proceeding under the United States Bankruptcy
Code, each Lender shall be recognized as the holder of a separate claim for the
purpose of the approval or rejection of a plan under 11 U.S.C. Section 1126, may
freely vote such claim, and the provisions of this Section shall control Section
9.02(b) and the other provisions of this Agreement that might otherwise require
the consent of the Required Lenders or of all Lenders in such circumstances. The
Administrative Agent and Co-Administrative Agent shall continue as such under
this Agreement and the other Loan Documents as they may be amended by any
adopted plan of reorganization in such a proceeding.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Co-Administrative Agent and their respective
Affiliates, including the reasonable fees, charges and disbursements of their
respective counsel, in connection with the syndication of the credit facilities
provided for herein, and the preparation and administration of this Agreement
and the other Loan Documents or any amendments, modifications or waivers of the
provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket
expenses incurred by any Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment related thereto and (iii) all out-of-pocket expenses incurred by the
Collateral Agent under the Guarantee and Collateral Agreement, any Issuing Bank
or any Lender, including the fees, charges and disbursements of any counsel for
the Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, and the other Loan
72
Documents including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative
Agent, the Co-Administrative Agent, each Issuing Bank and each Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery by the Borrower or any Grantor of this
Agreement, the other Loan Documents and any agreement or instrument contemplated
hereby or thereby, the performance by the Borrower or any Grantor of their
respective obligations hereunder and under the other Loan Documents or the
consummation of the Transactions or any other transactions contemplated hereby,
(ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit) (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property owned
or operated by the Borrower or any of its Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of its Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of such
Indemnitee.
(c) To the extent that the Borrower fails to pay any
amount required to be paid by it to the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank or the Swingline Lender under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent, the Co-Administrative Agent, each Issuing Bank or the
Swingline Lender, as the case may be, such Lender's pro rata share (determined
as of the time that the applicable unreimbursed expense or indemnity payment is
sought based on such Lender's Revolving Credit Commitment as a percentage of all
Revolving Credit Commitments) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Co-Administrative Agent, the Issuing Bank or the
Swingline Lender, in its capacity as such.
(d) To the extent permitted by applicable law, the
Borrower shall not assert, and it hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit, or the use of the proceeds thereof.
73
(e) All amounts due under this Section shall be payable
promptly after written demand therefor.
SECTION 9.04. Successors and Assigns; Participations and
Assignments. (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 of any Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section.
(b) (i) Subject to the conditions set forth in paragraph
(b)(ii) below, any Lender may assign to one or more assignees (each, an
"Assignee") all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitments and the Loans at the time owing
to it) with the prior written consent (such consent not to be unreasonably
withheld) of:
(A) the Borrower, provided that no consent of the Borrower
shall be required for an assignment to a Lender, an affiliate of a
Lender, an Approved Fund (as defined below) or, if an Event of Default
under Article VII has occurred and is continuing, any other Person; and
(B) the Co-Administrative Agent, provided that no consent of
the Co-Administrative Agent shall be required for an assignment of (x)
any Revolving Commitment to an assignee that is a Lender with a
Revolving Commitment immediately prior to giving effect to such
assignment or (y) all or any portion of a Term Loan to a Lender, an
Affiliate of a Lender or an Approved Fund.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender, an
affiliate of a Lender or an Approved Fund or an assignment of the
entire remaining amount of the assigning Lender's Commitments or Loans
under any Term Loan or Revolving Loan, the amount of the Commitments or
Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Administrative Agent) shall not
be less than $2,000,000 unless each of the Borrower and the
Administrative Agent otherwise consent, provided that (1) no such
consent of the Borrower shall be required if an Event of Default under
Article VII has occurred and is continuing and (2) such amounts shall
be aggregated in respect of each Lender and its affiliates or Approved
Funds, if any;
(B) the parties to each assignment shall execute and deliver
to the Co-Administrative Agent an Assignment and Acceptance, together
with a processing and recordation fee of $3,500; and
(C) the Assignee, if it shall not be a Lender, shall deliver
to the Administrative Agent an Administrative Questionnaire.
74
For the purposes of this Section 9.04, 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 Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity
that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) below, from and after the effective date specified in each
Assignment and Acceptance the Assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all of the assigning
Lender'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
2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04
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 Co-Administrative Agent, acting for this purpose as
an agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amount of the Loans and LC Disbursements owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower, each
Issuing Bank and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an Assignee, the Assignee's
completed Administrative Questionnaire (unless the Assignee shall already be a
Lender 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 Co-Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register. 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 Lender may, without the consent of the
Borrower or the Administrative Agent, sell participations to one or more banks
or other entities (a "Participant") in all or a portion of such Lender's rights
and obligations under this Agreement (including all or a portion of its
Commitments and the Loans owing to it); provided that (A) such Lender's
75
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the
Co-Administrative Agent, each Issuing Bank and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement pursuant to which a
Lender sells such a participation shall provide that such Lender 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 may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to the proviso to
Section 9.02(b) and (2) directly affects such Participant. Subject to paragraph
(c)(ii) of this Section, the Borrower agrees that each Participant shall be
entitled to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as
if it were a Lender 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 9.08 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.17(c) as
though it were a Lender.
(ii) A Participant shall not be entitled to receive any
greater payment under Section 2.14 or 2.16 than the applicable Lender 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 Borrower's prior written consent. Any Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.16 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with Section 2.16(e) as though it were a Lender.
(d) Any Lender 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 Lender, including 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 Lender from any of its
obligations hereunder or substitute any such pledgee or Assignee for such Lender
as a party hereto.
(e) The Borrower, upon receipt of written notice from the
relevant Lender, agrees to issue Notes to any Lender requiring Notes to
facilitate transactions of the type described in paragraph (d) above.
(f) Notwithstanding the foregoing, any Conduit Lender may
assign any or all of the Loans it may have funded hereunder to its designating
Lender without the consent of the Borrower or the Administrative Agent and
without regard to the limitations set forth in Section 9.04(b). Each of the
Borrower, each Lender, the Administrative Agent and the Co-Administrative Agent
hereby confirms that it will not institute against a Conduit Lender or join any
other Person in instituting against a Conduit Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
state bankruptcy or similar law, for one year and one day after the payment in
full of the latest maturing commercial paper note issued by such Conduit Lender;
provided, however, that each Lender designating any Conduit Lender hereby agrees
to indemnify, save and hold harmless each other party hereto for any loss,
76
cost, damage or expense arising out of its inability to institute such a
proceeding against such Conduit Lender during such period of forbearance.
SECTION 9.05. Survival. All covenants, agreements,
representations and warranties made by the Borrower herein and in the other Loan
Documents and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement and the other Loan Documents shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and the issuance of any Letters of Credit, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement or the other Loan Documents is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Revolving Credit Commitments have not
expired or terminated. The provisions of Sections 2.14, 2.15, 2.16, 9.03 and
9.12 and Article VIII shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Letters of Credit
and the Revolving Credit Commitments or the termination of this Agreement or any
provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to the
Administrative Agent, any Issuing Bank or any Lender constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating to
the subject matter hereof including, without limitation, each Commitment Letter
between the Borrower and each Lender, to the extent, but only to the extent,
that it relates to such Lender. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and the Co-Administrative Agent and when the
Co-Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement. Execution and delivery of
this Agreement as provided above shall constitute authorization to the
Administrative Agent and the Co-Administrative Agent to execute and deliver the
Intercreditor Agreement on its behalf, and each Assignee shall become a party to
the Intercreditor Agreement upon its becoming a Lender pursuant to the term and
conditions hereof.
SECTION 9.07. Severability. Any provision of this Agreement
held to be invalid, illegal or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such invalidity, illegality
or unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
77
SECTION 9.08. Right of Setoff. If an Event of Default shall
have occurred and be continuing, each Lender and each of its Affiliates is
hereby authorized, provided that it has the consent of the Co-Administrative
Agent (which consent may not be unreasonably withheld), at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other obligations at any time owing by such Lender or
Affiliate to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing under this
Agreement held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement and although such obligations may be
unmatured. The rights of each Lender under this Section are in addition to other
rights and remedies (including other rights of setoff) which such Lender may
have.
SECTION 9.09. Governing Law, Jurisdiction; Consent to Service
of Process. (a) This Agreement shall be construed in accordance with and
governed by the law of the State of New York applicable to contracts made and to
be performed in such state, without regard to conflict of laws principles.
(b) The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Courts of the State of New York sitting in New York County and of the United
States District Court sitting in New York County, New York and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement, or for recognition or enforcement of any judgment, and each
of the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York state or, to the extent permitted by law, in such Federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent,
the Co-Administrative Agent, the Issuing Bank or any Lender may otherwise have
to bring any action or proceeding relating to this Agreement against the
Borrower or its properties in the courts of any jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
(d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON
78
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative
Agent, the Co-Administrative Agent, the Issuing Banks and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) if an agreement containing provisions substantially the same as
those of this Section has been obtained, to any assignee of or Participant in,
or any prospective assignee of or Participant in, any of its rights or
obligations under this Agreement, (g) with the consent of the Borrower or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the
Administrative Agent, the Co-Administrative Agent, any Issuing Bank or any
Lender on a nonconfidential basis from a source other than the Borrower. For the
purposes of this Section, "Information" means all information received from the
Borrower relating to the Borrower or its Subsidiaries' businesses, other than
any such information that is available to the Administrative Agent, the
Co-Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by the Borrower; provided that, in the case of
information received from the Borrower after the date hereof, such information
is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.
SECTION 9.13. Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan or LC Disbursement, together with all fees, charges and other amounts
which are treated as interest on such Loan or LC Disbursement under applicable
law (collectively the "Charges"), shall exceed the maximum lawful rate (the
"Maximum Rate") which may be contracted for, charged, taken, received or
reserved by the Lender holding such Loan in accordance with applicable law, the
rate of interest payable in respect of such Loan hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and, to
the extent lawful, the interest and Charges that
79
would have been payable in respect of such Loan but were not payable as a result
of the operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.
80
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
Borrower TBC CORPORATION
By: /S/ ▇▇▇▇▇▇▇▇ ▇. DAY
-----------------------
Name: ▇▇▇▇▇▇▇▇ ▇. Day
Title: President and Chief Executive
Officer
Lenders and Administrative Agent FIRST TENNESSEE BANK NATIONAL
ASSOCIATION, individually, as
Administrative Agent, as Swingline
Lender and as Issuing Bank
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Senior Vice President
JPMORGAN CHASE BANK, individually, as
Co-Administrative Agent and as Issuing Bank
By: /S/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
individually and as Documentation Agent
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
SUNTRUST BANK, individually and as
Syndication Agent
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Director
81
FLEET CAPITAL CORPORATION
By: /S/ ▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇
Title: Senior Vice President
NATIONAL CITY
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
FIFTH THIRD BANK
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
GUARANTY BANK
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
REGIONS BANK
By: /S/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
UNION PLANTERS BANK, N.A.
By: /S/ ▇▇▇ ▇▇▇▇▇▇
-----------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Vice President
82
COMPASS BANK
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
SCHEDULE 1.01A
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of March 31, 2003 (as
amended and in effect on the date hereof, the "Credit Agreement"), among TBC
Corporation, the Lenders named therein, First Tennessee Bank National
Association, as Administrative Agent for the Lenders, and JPMorgan Chase Bank,
as Co-Administrative Agent for the Lenders. Terms defined in the Credit
Agreement are used herein with the same meanings.
The Assignor named on the reverse hereof hereby sells and assigns, without
recourse, to the Assignee named on the reverse hereof, and the Assignee hereby
purchases and assumes, without recourse, from the Assignor, effective as of the
Assignment Date set forth on the reverse hereof, the interests set forth on the
reverse hereof (the "Assigned Interest") in the Assignor's rights and
obligations under the Credit Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Revolving Credit Commitment of
the Assignor on the Assignment Date and Loans owing to the Assignor which are
outstanding on the Assignment Date, together with the participations in Letters
of Credit, LC Disbursements and Swingline Loans held by the Assignor on the
Assignment Date, but excluding accrued interest and fees to and excluding the
Assignment Date. The Assignee hereby acknowledges receipt of a copy of the
Credit Agreement and the other Loan Documents. From and after the Assignment
Date (i) the Assignee shall be a party to and be bound by the provisions of the
Credit Agreement and the Intercreditor Agreement and, to the extent of the
Assigned Interest, have the rights and obligations of a Lender thereunder and
under the other Loan Documents and (ii) the Assignor shall, to the extent of the
Assigned Interest, relinquish its rights and be released from its obligations
under the Credit Agreement and the other Loan Documents.
This Assignment and Acceptance is being delivered to the Administrative
Agent together with (i) if the Assignee is a Foreign Lender, any documentation
required to be delivered by the Assignee pursuant to Section 2.16(e) of the
Credit Agreement, duly completed and executed by the Assignee, and (ii) if the
Assignee is not already a Lender under the Credit Agreement, an Administrative
Questionnaire in the form supplied by the Administrative Agent, duly completed
by the Assignee. The Assignee shall pay the fee payable to the Administrative
Agent pursuant to Section 9.04(b) of the Credit Agreement.
This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date"):
FACILITY PRINCIPAL AMOUNT PERCENTAGE ASSIGNED OF
ASSIGNED FACILITY/REVOLVING CREDIT
COMMITMENT (SET FORTH,
TO AT LEAST 8 DECIMALS,
AS A PERCENTAGE OF THE
FACILITY AND THE
AGGREGATE REVOLVING
CREDIT COMMITMENTS OF
ALL LENDERS THEREUNDER
Revolving Credit $ %
Commitment Assigned:
Revolving Loans: $ %
Tranche A Term Loans: $ %
Tranche B Term Commitment $ %
Assigned:
Tranche B Term Loans: $ %
The terms set forth above and on the reverse side hereof are hereby agreed to:
[NAME OF ASSIGNOR], AS ASSIGNOR
BY: _________________________________
NAME:
TITLE:
[Name of Assignee], as Assignee
By: _________________________________
Name:
Title:
The undersigned hereby consent to the within assignment:
TBC Corporation JPMORGAN CHASE BANK, AS CO-ADMINISTRATIVE
AGENT
BY: _________________________________
NAME: BY: _________________________________
Title: NAME:
TITLE:
SCHEDULE 1.01B
FORM OF INCREMENTAL FACILITY ACTIVATION NOTICE
To: JPMORGAN CHASE BANK,
as Co-Administrative Agent under the Credit Agreement referred to below
Reference is hereby made to the Credit Agreement, dated as of March
[31], 2003 (as amended, supplemented or otherwise modified from time to time,
the "Credit Agreement"), among TBC Corporation (the "Borrower"), the Lenders
party thereto, the Syndication Agent and Documentation Agents named therein,
First Tennessee National Association, as administrative agent (in such capacity,
the "Administrative Agent") and JPMorgan Chase Bank, as co-administration agent
for the Lenders (in such capacity the "Co-Administrative Agent"). Terms defined
in the Credit Agreement shall have their defined meanings when used herein.
This notice is an Incremental Facility Activation Notice referred to
in the Credit Agreement, and the Borrower and each of the Lenders party hereto
hereby notify you that:
1. Each Lender party hereto agrees to make or increase the amount of
its Revolving Commitments in the amount set forth opposite such
Lender's name below under the caption "Increased Facility Amount".
2. The Increased Facility Closing Date is ______.
The undersigned [Chief Financial Officer][Vice President - Finance]
of the Borrower certifies as follows:
1. I am the duly elected, qualified and acting [Chief Financial
Officer][Vice President - Finance] of the Borrower.
2. I have reviewed and am familiar with the contents of this Increased
Facility Activation Notice.
3. I have reviewed the terms of the Credit Agreement and the Loan
Documents and have made or caused to be made under my supervision, a
review in reasonable detail of the transactions and condition of the
Borrower during the accounting period ended __________ __, 200_
[insert most recent period for which Financial Statements have been
delivered]. Such review did not disclose the existence during or at
the end of the accounting period covered by the Financial
Statements, and I have no knowledge of the existence, as of the date
of this Certificate, of any Default or Event of Default, both on the
date hereof and after giving pro forma effect to any Loans made
pursuant to this Increased Facility Activation Notice and the
application of the proceeds therefrom.
4. The requirements set forth in clauses (B), (C) and (D) of the
proviso to Section 2.02(d) of the Credit Agreement have been
complied with in connection with this Increased Facility Activation
Notice.
IN WITNESS WHEREOF, the undersigned have executed this Increased
Facility Activation Notice this _____ day of ____, 200__.
------------------------------------
Name:
Title: [Chief Financial Officer][Vice
President-Finance]
TBC CORPORATION
By:______________________________
Name:
Title:
Increased Facility Amount [NAME OF LENDER]
$
By:______________________________
Name:
Title:
CONSENTED TO:
JPMORGAN CHASE BANK,
as Co-Administrative Agent
By:______________________________
Name:
Title:
SCHEDULE 1.01C
EXISTING LETTERS OF CREDIT
Zurich American Insurance Company $2,700,000
First Tennessee National Association $1,560,000
Traveler's Insurance Company $ 118,000
Zurich American Insurance Company $2,322,000
Traveler's Casualty & Surety Company of American $ 300,000
Total $7,000,000
SCHEDULE 2.01
COMMITMENTS
Revolving Tranche A Tranche B
Lender Credit Term Loan Term Loan Total
Commitment Commitment Commitment
---------------------------------- ------------- ---------- ---------- -----------
JPMorgan Chase Bank $17,482,016 $ 8,920,862 $ 3,597,122 $ 30,000,000
First Tennessee Bank National
Association $13,694,245 $ 6,988,009 $ 2,817,746 $ 23,500,000
SunTrust Bank $14,568,345 $ 7,434,053 $ 2,997,602 $ 25,000,000
U.S. Bank National Association $14,568,345 $ 7,434,053 $ 2,997,602 $ 25,000,000
Fleet Capital Corporation $11,654,676 $ 5,947,242 $ 2,398,082 $ 20,000,000
National City $11,654,676 $ 5,947,242 $ 2,398,082 $ 20,000,000
Fifth Third Bank $ 8,741,007 $ 4,460,432 $ 1,798,561 $ 15,000,000
Guaranty Bank $ 8,741,007 $ 4,460,432 $ 1,798,561 $ 15,000,000
Regions Bank $ 8,741,007 $ 4,460,432 $ 1,798,561 $ 15,000,000
Union Planters Bank, N.A. $ 8,741,007 $ 4,460,432 $ 1,798,561 $ 15,000,000
Compass Bank $ 2,913,669 $ 1,486,811 $ 599,520 $ 5,000,000
Total $121,500,000 $62,000,000 $25,000,000 $208,500,000
SCHEDULE 2.02
FORM OF NEW LENDER SUPPLEMENT
NEW LENDER SUPPLEMENT (this "New Lender Supplement"), dated
_________________, to the Credit Agreement, dated as of March [31], 2003 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among TBC Corporation (the "Borrower"), the Lenders party thereto,
the Syndication Agent and Documentation Agents named therein, First Tennessee
National Association, as administrative agent (in such capacity, the
"Administrative Agent") and JPMorgan Chase Bank, as co-administration agent for
the Lenders (in such capacity the "Co-Administrative Agent").
W I T N E S S E T H :
WHEREAS, the Credit Agreement provides in Section 2.02(e) thereof
that any bank, financial institution or other entity may become a party to the
Credit Agreement with the consent of the Borrower and the Co-Administrative
Agent (which consent shall not be unreasonably withheld) by executing and
delivering to the Borrower and the Co-Administrative Agent a supplement to the
Credit Agreement in substantially the form of this New Lender Supplement; and
WHEREAS, the undersigned now desires to become a party to the Credit
Agreement;
NOW, THEREFORE, the undersigned hereby agrees as follows:
1. The undersigned agrees to be bound by the provisions of the
Credit Agreement, and agrees that it shall, on the date this New Lender
Supplement is accepted by the Borrower and the Co-Administrative Agent,
become a Lender for all purposes of the Credit Agreement to the same
extent as if originally a party thereto, with Revolving Loans of
$__________.
2. The undersigned (a) represents and warrants that it is legally
authorized to enter into this New Lender Supplement; (b) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements referred to in Section 3.04 thereof and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this New Lender Supplement; (c)
agrees that it has made and will, independently and without reliance upon
any agent or any other lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit Agreement or any
instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Administrative Agent and the Co-Administrative Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Credit Agreement or any instrument or document
furnished pursuant hereto or thereto as are delegated to the
Administrative Agent and the Co-Administrative Agent by the terms thereof,
together with such powers as are incidental thereto; and (e) agrees that
it will be bound by the provisions of the Credit Agreement and will
perform in accordance with its terms all the obligations which by the
terms of the Credit Agreement are required to be performed by it as a
Lender including, without limitation, if it is organized under the laws of
a jurisdiction outside the United States, its obligation pursuant to
Section 2.16(e) of the Credit Agreement.
3. The address of the undersigned for notices for the purposes of
the Credit Agreement is as follows:
4. Terms defined in the Credit Agreement shall have their defined
meanings when used herein.
IN WITNESS WHEREOF, the undersigned has caused this New Lender
Supplement to be executed and delivered by a duly authorized officer on the date
first above written.
[INSERT NAME OF LENDER]
By________________________________
Name:
Title:
Accepted this _____ day of
______________, ____.
TBC CORPORATION
By____________________________
Name:
Title:
Accepted this ____ day of
______________, ____.
JPMORGAN CHASE BANK,
as Co-Administrative Agent
By____________________________
Name:
Title:
SCHEDULE 3.01
BORROWER AND SUBSIDIARIES AND JURISDICTIONS OF ORGANIZATION
Borrower: TBC Corporation, A Delaware Corporation ("TBC")
Subsidiaries directly owned by TBC:
Name Jurisdiction of Percentage of Stock/ Subsidiaries
Organization Equity Owned by TBC
---- --------------- -------------------- ------------
Big O Tires, Inc. Nevada 100% See Below
▇▇▇▇▇▇▇'▇, Inc. Georgia 100% None
Northern States Tire, Inc. Delaware 100% None
TBC International Inc. Delaware 100% None
TBC Retail Enterprises, Inc. Delaware 100% See Below
TBC Brands, LLC Delaware 100% None
TBC Capital, LLC Delaware 90%* None
*5% is owned by each of ▇▇▇▇▇▇▇'▇, Inc. and Tire Kingdom, Inc.
Subsidiaries Directly Owned by Big O Tires, Inc.:
Name Jurisdiction of Percentage of Stock Subsidiaries
Incorporation Owned by Big O
---- --------------- -------------------- ------------
Big O Development, Inc. Colorado 100% None
O Advertising, Inc. Colorado 100% None
Big O Tire of Idaho, Inc. Idaho 100% None
Subsidiaries Directly Owned by TBC Retail Enterprises, Inc.:
Name Jurisdiction of Percentage of Stock Subsidiaries
Incorporation Owned by TBC Retail
---- --------------- -------------------- ------------
Big O Retail Enterprises, Colorado 100% None
Inc.
Tire Kingdom, Inc. Florida 100% See Below
Subsidiaries Directly Owned By Tire Kingdom, Inc.:**
Name Jurisdiction of Percentage of Stock Subsidiaries
Incorporation Owned by TKI
---- --------------- -------------------- ------------
Merchant's, Incorporated Delaware 100% See Below
Subsidiaries Directly Owned By Merchant's, Incorporated:**
Name Jurisdiction of Percentage of Stock Subsidiaries
Incorporation Owned by Merchant's
---- --------------- -------------------- ------------
Merban, Inc. Virginia 100% None
--------
** After Closing Date of Merchant's Acquisition.
SCHEDULE 3.15
TRADEMARKS, TRADENAMES AND SERVICE MARKS
TIRE KINGDOM, INC.
TRADEMARK REPORT BY ▇▇▇▇ PRINTED:3/28/2003 PAGE 1
STATUS:ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
MISCELLANEOUS [CROWN] DESIGN
UNITED STATES 9/1/1999 75/791,760 6/27/2000 2,363,324 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/5/2003 76/487,769 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/10/1992 74/338,671 5/31/1994 1,838,215 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/5/2003 76/487,604 PENDING 35
END OF TOTAL ITEMS SELECTED = 4
BIG O TIRES, INC.
TRADEMARK REPORT BY ▇▇▇▇ PRINTED:3/28/2003 PAGE 1
STATUS:ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
A REPUTATION YOU CAN RIDE ON
UNITED STATES 2/22/1993 74/360,838 7/19/1994 1,845,544 REGISTERED 37,42
ASPEN
UNITED STATES 3/25/1988 73/718,614 10/11/1988 1,508,041 REGISTERED 12
BIG FOOT
CANADA 3/15/1988 602897 3/13/1992 395398 REGISTERED A
MEXICO 5/15/1998 332727 10/20/2000 674604 REGISTERED 12
UNITED STATES 5/7/1993 74/389,931 7/11/1995 1,904,955 REGISTERED ▇▇
▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/6/1974 73/031,264 9/12/1978 1,102,058 REGISTERED ▇▇
▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/16/1974 73/031,311 9/12/1978 1,102,059 REGISTERED 12
BIG HAUL
UNITED STATES 10/3/1974 73/033,736 8/26/1975 1,018,800 REGISTERED ▇▇
▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇/▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/17/1997 75/358,399 12/18/2001 2,520,443 REGISTERED 35,37
BIG O
MEXICO 5/15/1998 332726 10/20/2000 674603 REGISTERED 12
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
TEXAS 9/2/1982 N/A 9/2/1982 40704 REGISTERED 12
TEXAS 11/1/1982 40967 11/1/1982 40967 REGISTERED 42
UNITED STATES 1/14/1974 73/010,921 9/24/1974 993,415 REGISTERED 12
UNITED STATES 9/10/1973 73/000,572 10/1/1974 994,466 REGISTERED 42
BIG O TIRES
CANADA 6/18/1987 586384 10/27/1989 361490 REGISTERED N/A
CANADA 5/5/1999 1,014,484 2/21/2002 TMA558285 REGISTERED 12,35,37
MEXICO 5/15/1998 332728 10/20/2000 674605 REGISTERED 42
UNITED STATES 4/12/1999 75/679,597 12/12/2000 2,411,926 REGISTERED 12,35,37
BIG O TIRES & DESIGN
CANADA 6/12/1981 259,938 REGISTERED N/A
CANADA 3/27/1991 682687 11/12/1993 TMA419439 REGISTERED N/A
BIG O TIRES AND DESIGN
UNITED STATES 12/4/1989 74/007,344 8/28/1990 1,611,160 REGISTERED 12,42
COST U LESS & DESIGN
CANADA 8/5/1994 761237 10/28/1997 TMA484761 REGISTERED A,AA
MEXICO 8/9/1994 207912 10/11/1994 476693 REGISTERED ▇▇,▇
▇▇▇▇▇▇ 8/9/1994 207911 10/5/1994 476099 REGISTERED ▇▇
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 7/12/1994 74/548,947 1/30/1996 1,952,457 REGISTERED 12,37,42
DARE TO COMPARE
UNITED STATES 4/20/2000 76/030,453 9/25/2001 2,492,236 REGISTERED 035
DESIGN OF BIG FOOT
CANADA 5/5/1999 1,014,482 3/15/2001 TMA542,415 REGISTERED 12,35,37
UNITED STATES 4/12/1999 75/680,850 2/1/2000 2,314,775 REGISTERED 12,35,37
EURO TOUR
CANADA 1/15/2003 1164833 PENDING 12
MEXICO 2/3/2003 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/8/2002 76/468,502 PENDING 12
EXTRA CARE & DESIGN
UNITED STATES 3/24/1986 589,583 11/18/1986 1,417,730 REGISTERED 37
UNITED STATES 3/24/1986 73/589,583 11/18/1986 1,417,730 REGISTERED 37
HYDRO-TRAC
MEXICO 1/14/1994 188025 5/4/1994 459327 REGISTERED 12
LEGACY
CANADA 3/15/1988 602896 3/13/1992 395397 REGISTERED N/A
COLORADO 10/28/1985 N/A 10/28/1985 T29645 REGISTERED 35
COLORADO 4/22/1976 T30670 REGISTERED
MEXICO 1/14/1994 188026 5/4/1994 459328 REGISTERED 12
UNITED STATES 10/31/1985 73/566,064 5/20/1986 1,393,967 REGISTERED 12
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
LIGHTENING
MEXICO 1/14/1994 188027 12/6/1994 481629 REGISTERED 12,35
PATHMAX
UNITED STATES 8/3/1998 75/529,550 9/28/1999 2,281,419 REGISTERED 12
PROCOMP
MEXICO 1/14/1994 188028 5/4/1994 459329 REGISTERED 12,35
PROCOMP HIGH PERFORMANCE
UNITED STATES 7/27/1992 74/298,320 7/5/1994 1,842,854 REGISTERED 12
SASQUATCH [BIG FOOT] DESIGN
CANADA 5/5/1999 1,014,483 1/16/2003 TMA573769 REGISTERED 12,35,37
SONIC COMMERICAL
UNITED STATES 12/2/1964 72/207,339 3/15/1966 805,578 REGISTERED ▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/31/1968 72/310,988 6/17/1969 871,318 REGISTERED 35
VENGEANCE
CANADA 1/2/2003 ▇/▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇/▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/18/2002 76/460,700 PENDING 12
▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇ & DESIGN
CANADA 3/20/2001 1096649 PENDING
MEXICO 3/29/2001 478565 8/30/2001 713395 REGISTERED 37
MEXICO 3/29/2001 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/1/2000 76/174,243 12/4/2001 2,514,975 REGISTERED 35,37
END OF TOTAL ITEMS SELECTED = 63
TBC BRANDS, LLC
TRADEMARK REPORT BY ▇▇▇▇ PRINTED:3/28/2003 PAGE 1
STATUS:ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
AQUA FLOW
CANADA 3/9/1993 724,287 7/15/1994 430478 REGISTERED N/A
JAPAN 8/25/1993 87543/93 7/31/1996 3183343 REGISTERED 12
MEXICO 3/24/1993 163889 8/3/1993 438707 REGISTERED 12
UNITED STATES 11/24/1992 74/334,184 1/4/1994 1,815,411 REGISTERED 12
AQUA FLOW III
CANADA 2/5/2001 1091561 ALLOWED
MEXICO 3/13/2001 475492 5/24/2001 699369 REGISTERED
UNITED STATES 9/13/2000 76/128,049 4/2/2002 2,557,298 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,568 PENDING 12
CENTRED
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
CANADA 2/19/1999 1006129 10/18/2000 TMA535,038 REGISTERED 12
MEXICO 4/23/1999 372561 2/29/2000 644642 REGISTERED 12
UNITED STATES 1/15/1999 75/621,314 3/20/2001 2,437,511 REGISTERED 12
CENTRON
UNITED STATES 3/12/1985 73/526,552 9/3/1985 1,357,941 REGISTERED 12
CENTURY
CANADA 9/10/1999 1,028,617 11/22/2002 TMA571137 REGISTERED N/A
UNITED STATES 7/30/1999 75/764,830 7/17/2001 2,470,426 REGISTERED 12
CORDOVAN
CANADA 3/8/1990 652,673 4/5/1991 382741 REGISTERED 12
CHINA 6/28/2002 3225736 PENDING 12
EUROPEAN UNION 12/30/1997 719351 4/7/1999 000719351 REGISTERED 9,12
FRANCE 4/25/1991 282653 4/25/1991 1657817 REGISTERED 9,12
GERMANY 4/30/1991 T31825/12W 7/14/1992 2017105 REGISTERED 9,12
MEXICO 12/19/1997 318673 2/27/1998 571618 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 4/24/1991 1462329 4/24/1991 1462329 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 5/21/1991 1464865 5/21/1991 1464865 REGISTERED 9
UNITED STATES 9/27/1985 73/560,572 12/2/1986 1,419,104 REGISTERED ▇▇,▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/15/1945 72/159,045 8/27/1963 755,493 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 5/19/1964 72/193,756 2/9/1965 784,838 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/29/1976 73/108,055 9/19/1978 1,102,631 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 8/30/1967 72/279,376 8/6/1968 854,177 REGISTERED 35
CRITERION
UNITED STATES 2/29/1980 73/252,026 9/15/1981 1,169,191 REGISTERED 12
EPIC
CANADA 6/13/2000 1,063,059 8/7/2002 TMA565594 REGISTERED N/A
MEXICO 1/4/1995 220948 3/28/1995 486515 REGISTERED 12
UNITED STATES 9/10/1985 73/559,173 4/8/1986 1,388,996 REGISTERED 12
EXCEL
CANADA 9/10/1999 1,028,616 ALLOWED N/A
UNITED STATES 7/30/1999 75/764,829 7/17/2001 2,470,425 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 5/7/1985 73/536,361 11/5/1985 1,368,849 REGISTERED 12
FRONTLINE
MEXICO 10/21/1994 216047 8/30/1995 502347 REGISTERED 12
GRAN ESPRIT
EUROPEAN UNION 9/19/1996 385617 8/28/1998 385617 REGISTERED 12
UNITED STATES 5/20/1996 75/107,105 4/14/1998 2,151,303 REGISTERED 12
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
GRAND AM
CANADA 12/29/1994 772,065 6/14/1996 459411 REGISTERED 12
MEXICO 10/13/1994 215380 11/22/1994 480234 REGISTERED 12
GRAND PRIX
CANADA 10/26/1993 739674 3/16/1999 TMA509,415 REGISTERED N/A
MEXICO 11/8/1993 182542 PENDING 12
MEXICO 8/30/1994 210274 11/18/1994 479812 REGISTERED 7
UNITED STATES 5/5/1980 73/260,923 12/29/1981 1,183,571 REGISTERED 11
UNITED STATES 10/26/1982 73/400,864 11/22/1983 1,258,438 REGISTERED 9
UNITED STATES 12/12/1975 73/071,592 10/25/1977 1,075,901 REGISTERED 12
UNITED STATES 8/24/1987 73/680,289 8/27/1991 1,655,035 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/1982 73/355,136 1/18/1983 1,224,147 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/25/1959 72/070,188 12/22/1959 690,249 REGISTERED 35
GRAND PRIX RADIAL G/T (STYLIZED)
UNITED STATES 5/5/1980 73/260,924 8/11/1981 1,164,594 REGISTERED 12
GRAND SPIRIT
MEXICO 7/24/1995 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 1/24/1994 74/481,579 2/27/1996 1,958,273 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,572 PENDING 12
GRAND SPORT
CANADA 4/12/1990 654,898 3/6/1992 TMA 395,089 REGISTERED 12
MEXICO 1/4/1995 220944 4/23/1997 546167 REGISTERED 12
UNITED STATES 5/13/1986 73/598,547 12/23/1986 1,421,825 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ 12/29/1994 772,070 1/19/1996 TMA452894 REGISTERED 12
CHINA 1/30/2002 3084124 ALLOWED 12
MEXICO 10/13/1994 215383 7/21/1995 497846 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/19/1989 73/807,530 5/8/1990 1,595,216 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/2000 76/004,068 4/9/2002 2,559,952 REGISTERED ▇▇
▇▇▇▇ ▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 8/10/1976 73/096,101 12/13/1977 1,079,273 REGISTERED 9
MATRIX
BRAZIL 10/25/1999 822129833 PENDING
UNITED STATES 3/13/1985 73/562,619 3/1/1988 1,478,574 REGISTERED 12
MILEAGE MASTER
UNITED STATES 3/12/2003 76/497,354 PENDING
MULTI-MILE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
CANADA 2/29/2000 654903(1) 4/12/1991 TMA383056 REGISTERED 12
CHINA 6/28/2002 3225735 PENDING 12
EUROPEAN UNION 12/30/1997 719260 4/7/1999 000719260 REGISTERED 9,12
FRANCE 4/24/1991 282446 4/2/1991 1657653 REGISTERED 9,12
MEXICO 3/24/1993 163887 7/3/1993 438706 REGISTERED 12
MEXICO 10/21/1994 216045 3/22/1995 485680 REGISTERED ▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 4/23/1991 1462051 4/23/1991 B1462051 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 5/21/1991 1464866 5/21/1991 B1464866 REGISTERED 9
UNITED STATES 8/23/1982 73/381,561 11/29/1983 1,259,363 REGISTERED 12
UNITED STATES 5/15/1998 75/485,588 8/3/1999 2,266,907 REGISTERED ▇▇
▇▇▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 5/11/1950 71/597,256 6/24/1952 560,428 REGISTERED 12
MULTI-MILE RADIAL G/T (STYLIZED)
UNITED STATES 11/29/1976 73/108,056 9/18/1979 1,125,174 REGISTERED 12
MULTI-MILE WIDE '600'
UNITED STATES 8/30/1967 72/279,377 8/6/1968 854,178 REGISTERED 35
MULTI-TRAC
MEXICO 10/13/1994 215381 7/19/1995 497555 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/22/1973 72/452,297 3/26/1974 981,104 REGISTERED 35
POWER KING
CANADA 4/12/1990 654,907 4/5/1991 382759 REGISTERED 12
CHINA 1/30/2002 3084106 ALLOWED 12
MEXICO 6/11/1998 336096 PENDING ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 4/5/1979 73/210,451 7/29/1980 1,138,319 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/7/1983 73/412,703 4/3/1984 1,272,524 REGISTERED ▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/21/2002 76/424,630 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/8/2002 76/468,503 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ 5/27/1959 251153 12/11/1959 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/1/1954 71/672,582 6/7/1955 607,037 REGISTERED 35
REGENT
CANADA 8/3/2000 1,069,844 PENDING
MEXICO 11/21/2000 459062 8/16/2002 758958 REGISTERED 12
UNITED STATES 12/17/1999 75/874,916 6/26/2001 2,464,646 REGISTERED 12
SCEPTOR
UNITED STATES 5/13/1986 73/598,549 12/23/1986 1,421,827 REGISTERED 12
SHADOW
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
CANADA 8/3/2000 1,069,845 PENDING
MEXICO 9/11/2002 565576 PENDING
UNITED STATES* 12/17/1999 75/874,915 PENDING 12
* IN THE NAME OF TBC CORPORATION
SIGMA
CANADA 4/12/1990 654,894 4/5/1991 382758 REGISTERED 12
CHINA 6/28/2002 3225734 PENDING 12
GERMANY 6/10/1991 T32059/12 W 7/14/1992 2017108 REGISTERED 12
MEXICO 5/29/1995 N/A 7/27/1995 499136 REGISTERED 12
MEXICO 5/29/1995 N/A 7/27/1995 499136 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 6/6/1991 1466536 6/6/1991 1466536 REGISTERED 12
UNITED STATES 5/15/1998 75/485,561 7/20/1999 2,262,889 REGISTERED 12
SIGMA & DESIGN
UNITED STATES 12/28/1973 73/009,844 11/19/1974 998,427 REGISTERED 12
SIGMA SUPREME HP
CANADA 8/3/2000 1,069,847 ALLOWED
MEXICO 11/21/2000 459065 12/14/2001 728573 REGISTERED
UNITED STATES 7/26/2000 76/096,412 6/4/2002 2,575,403 REGISTERED 12
SIGMA SUPREME TR
CANADA 8/3/2000 1,069,848 ALLOWED
MEXICO 11/21/2000 459064 12/14/2001 728572 REGISTERED 12
UNITED STATES 12/17/1999 75/874,912 3/26/2002 2,553,584 REGISTERED 12
SOVRAN
UNITED STATES 7/27/1989 73/815,288 6/12/1990 1,600,677 REGISTERED 12
STAMPEDE
CANADA 12/29/1994 772,066 11/3/1995 TMA449689 REGISTERED 12
MEXICO 1/4/1995 220945 3/28/1995 486513 REGISTERED 12
UNITED STATES 9/18/1984 73/499,961 5/28/1985 1,337,798 REGISTERED 12
SUSSEX
UNITED STATES 5/13/1986 73/598,548 12/23/1986 1,421,826 REGISTERED 12
TALON
CANADA 12/29/1994 772,067 11/3/1995 TMA449690 REGISTERED 12
MEXICO 1/4/1995 220943 3/28/1995 486512 REGISTERED 12
UNITED STATES 9/10/1985 73/559,172 4/8/1986 1,388,995 REGISTERED 12
TBC
MEXICO 8/6/1999 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/26/1983 73/449,847 7/2/1985 1,345,491 REGISTERED 9,12
UNITED STATES 6/13/1978 73/174,209 2/20/1979 1,113,549 REGISTERED 12
UNITED STATES 6/8/1995 74/685,983 11/25/1997 2,114,992 REGISTERED ▇▇,▇▇,▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/12/2002 76/369,496 ALLOWED 9,12,16
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
TBC ONLINE
CANADA 4/16/1998 875566 6/29/2000 TMA529893 REGISTERED 9
MEXICO 12/16/1998 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 1/23/1998 75/423,437 1/25/2000 2,312,424 REGISTERED ▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/12/2002 76/369,492 ALLOWED 35
TEMPEST
CANADA 8/3/2000 1,069,846 ALLOWED
MEXICO 11/21/2000 459063 12/14/2001 728571 REGISTERED 12
UNITED STATES 12/17/1999 75/874,914 6/19/2001 2,462,822 REGISTERED 12
TODAY
UNITED STATES 2/25/1994 74/494,330 1/21/1997 2,032,519 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/2000 76/004,067 4/2/2002 2,557,059 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇/▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,525 PENDING 12
TRAIL SCOUT
MEXICO 7/30/1999 385267 9/22/1999 624142 REGISTERED 12
UNITED STATES 4/12/1999 75/679,588 7/3/2001 2,466,356 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/12/2003 76/497,369 PENDING
TURBO-TECH
UNITED STATES 7/18/1989 73/813,331 10/2/1990 1,615,599 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/1/1984 73/506,662 6/11/1985 1,340,421 REGISTERED 9
ULTRA LIFE
UNITED STATES 11/5/1984 73/507,226 11/19/1985 1,371,051 REGISTERED 9
ULTREX
UNITED STATES 3/16/1994 74/500,719 4/16/1996 1,968,838 REGISTERED 12
VANDERBILT
UNITED STATES 10/6/1961 72/129,434 6/11/1963 750,869 REGISTERED 12
VANDERBILT TOURING
UNITED STATES 12/4/2002 76/472,570 PENDING 12
WILD COUNTRY
CANADA 12/29/1994 772,071 1/19/1996 TMA452895 REGISTERED 12
MEXICO 1/4/1995 220947 3/28/1995 486514 REGISTERED 12
UNITED STATES 6/30/1992 74/289,945 3/2/1993 1,755,187 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/1/1992 74/335,812 2/15/1994 1,822,004 REGISTERED 12
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
------- ----- ----- ----- ---- ------ -------
WILD SPIRIT TOURING LS
UNITED STATES 12/4/2002 76/472,571 PENDING 12
WILD TRAC
CANADA 12/29/1994 772,069 5/9/1997 TMA475995 REGISTERED 12
MEXICO 1/4/1995 220937 3/28/1995 486510 REGISTERED 12
UNITED STATES 7/3/1978 73/177,148 7/17/1979 1,122,304 REGISTERED 12
END OF TOTAL ITEMS SELECTED = 168
MERCHANT'S, INCORPORATED AND MERBAN, INC.
(after Closing Date of Merchant's Acquisition)
REGISTRATION NO. REGISTRATION DATE
---------------- -----------------
Team Merchant's Performance
Specialists
UNITED STATES 2,248,803 09/17/2000
29 Minutes or Less, Tire Express
UNITED STATES 2,077,075 07/18/1997
No One Cares for Your Car
Like Merchant's
UNITED STATES 2,389,988 09/26/2000
Ready to Roll Tire Pricing
UNITED STATES 75/564,275 SUBJECT TO PENDING OPPOSITION FILING
Merchant's Maintenance Alert
UNITED STATES 2,078,719 07/15/1997
Merchant's Tire & Auto Center
UNITED STATES 1,420,446 11/14/87
11/30/92
04/05/93
Service That You Trust - Guaranteed
UNITED STATES 1,743,581 12/29/1992
Merchant's
UNITED STATES 1,907,199 07/28/1995
COPYRIGHT REGISTRATIONS
TITLE OF WORK COPYRIGHT REG. NO. REG. DATE
------------- ----------------- ---------
TBC CORPORATION TX-2-920-912 09/21/90
ELECTRONIC ORDERING SYSTEM
INFO-NET USER'S GUIDE TX-4-135-989 11/13/95
(INFO-NET ONLINE; DIRECT
CONNECTION INFO-NET)
INFO-NET ONLINE, RELEASE 4.1 TX-4-168-625 12/07/95
(INFO-NET ONLINE; DIRECT
CONNECTION INFO-NET)
ELECTRONIC ORDERING SYSTEM TX-4-212-078 12/07/95
RELEASE 1.0
SCHEDULE 3.16(a)
UCC FILING JURISDICTIONS
Colorado
Big O Development, Inc.
Big O Retail Enterprises, Inc.
O Advertising, Inc.
Delaware
Merchant's, Incorporated
Northern States Tire, Inc.
TBC International Inc.
TBC Retail Enterprises, Inc.
TBC Brands, LLC
TBC Capital, LLC
TBC Corporation
Florida
Tire Kingdom, Inc.
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇'▇, Inc.
Idaho
Big O Tire of Idaho, Inc.
Nevada
Big O Tires, Inc.
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, Inc.
SCHEDULE 3.16(b)
MORTGAGE FILING JURISDICTIONS
Tennessee
TBC Corporation
SCHEDULE 4.01(b)
FORM OF OPINION LETTER
April 1, 2003
To the Administrative Agent, the Co-Administrative Agent,
the Collateral Agent, and the Lenders who are
parties to the agreements described below.
Ladies and Gentlemen:
We have acted as counsel to TBC Corporation, a Delaware Corporation (the
"Borrower"), in connection with (i) its execution and delivery of a Credit
Agreement, dated as of March 31, 2003 (the "Credit Agreement"), among the
Borrower, the lenders party thereto, First Tennessee Bank National Association,
as administrative agent (the "Administrative Agent"), and ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank
as Co-Administrative Agent (the "Co-Administrative Agent"); (ii) its execution
and delivery of a Guarantee and Collateral Agreement, dated March 31, 2003 (the
"Guarantee and Collateral Agreement"), in favor of ▇▇ ▇▇▇▇▇▇ Chase Bank, as
Collateral Agent (the "Collateral Agent"); (iii) its execution and delivery of
an Acknowledgment and Agreement to the Intercreditor Agreement, dated as of
March 31, 2003 (the "Acknowledgment"), among the lenders party to the Credit
Agreement, The Prudential Insurance Company of America ("Prudential"), and
certain affiliates of Prudential (collectively, the "Lenders"); and (iv) the
transactions contemplated by the Credit Agreement, the Guarantee and Collateral
Agreement, and the Acknowledgment.
We have also acted as counsel to TBC International Inc., a Delaware Corporation
("TBCI"), ▇▇▇▇▇▇▇'▇, Inc., a Georgia Corporation ("▇▇▇▇▇▇▇'▇"), Big O Tires,
Inc., a Nevada corporation ("Big O"), Big O Tire of Idaho, Inc., an Idaho
Corporation ("Idaho"), TBC Retail Enterprises, Inc., a Delaware Corporation
("TBC Retail"), Tire Kingdom, Inc., a Florida Corporation ("Tire Kingdom"),
Northern States Tire, Inc., a Delaware Corporation ("NST"), Big O Retail
Enterprises, Inc., a Colorado Corporation ("Bore"), Big O Development, Inc., a
Colorado Corporation ("BODI"), O Advertising, Inc., a Colorado Corporation ("O
Advertising"), TBC Brands, LLC, a Delaware limited liability company ("TBC
Brands"), TBC Capital, LLC, a Delaware limited liability company ("TBC
Capital"), Merchant's, Incorporated, a Delaware Corporation ("Merchants"), and
Merban, Inc., a Virginia Corporation ("Merban"), in connection with (i) the
execution and delivery by each of the Guarantee and Collateral Agreement; and
(ii) the consummation of the transactions contemplated thereby.
We have also acted as counsel to the Borrower, Big O, Tire Kingdom, Merchants
and TBC Retail in connection with the execution and delivery of blank stock
powers relating to the capital stock or membership interests owned by each in
any of the Subsidiaries (collectively, the "Stock Powers").
We have also acted as counsel to the Borrower, TBCI, TBC Retail, NST, TBC
Brands, TBC Capital and Merchants in connection with the delivery of UCC-1
financing statements (the "Financing Statements") to be filed with the Secretary
of State of Delaware.
This opinion is being delivered pursuant to Section 4.01(b) of the Credit
Agreement. All capitalized terms used in this opinion but not defined herein
shall have the meanings given to them in the Credit Agreement, as the context
indicates.
We have examined the Credit Agreement, the Guarantee and Collateral Agreement,
the Acknowledgment, and the Stock Powers (collectively, the "Transaction
Documents"), together with telecopied facsimiles of the signature pages of each
of the foregoing. we have also examined such other documents, certificates of
officers of Borrower and its Subsidiaries or public officials, and corporate
records, and have made investigation of such other matters, as in our judgment
permit us to render an informed opinion on the matters set forth herein.
In connection with our examination, we have assumed that the execution copies of
the Transaction Documents conform to the copies of such documents delivered to
us by counsel to the Lenders. We have also assumed the genuineness of all
signatures (other than those on behalf of Borrower or any Subsidiary), the
authenticity of all documents submitted to us as originals, the conformity with
the originals of all documents submitted to us as copies or telecopied
facsimiles, and the authenticity of the originals of such latter documents.
Further, with your consent, with respect to the Lenders, the Administrative
Agent, the Co-Administrative Agent, and the Collateral Agent, we have assumed
the legal power of each to enter into and perform the Transaction Documents to
which they are parties, and the due authorization, execution, and delivery of
the Transaction Documents to which they are parties, and we have relied on all
representations or warranties contained in the Transaction Documents insofar as
they relate to matters of fact not within our knowledge.
Based upon the foregoing and subject to the last two paragraphs of this letter,
we are of the opinion that:
1. Each of the Borrower and the Subsidiaries is a corporation duly incorporated
or a limited liability company duly organized, validly existing, and in good
standing under the laws of its state of incorporation or organization and has
all requisite authority to conduct its business as now being conducted.
2. The execution and delivery of the Transaction Documents by the Borrower and
each Subsidiary which is a party thereto, and the performance by Borrower and
each Subsidiary of their respective obligations thereunder, have been duly
authorized by all necessary actions and proceedings and will not:
(a) Require any consent of the stockholders of Borrower or the stockholder
or members of any Subsidiary which has not been obtained.
(b) Violate any law, rule, regulation, order, writ, judgment, injunction,
decree, or award of which we are aware and which is binding on the
Borrower or any Subsidiary; violate the Certificate or Articles of
Incorporation, By-Laws, Certificate of Formation, or Limited Liability
Company Agreement of Borrower or any Subsidiary; or violate any indenture,
instrument, or agreement of which we are aware and which is binding upon
Borrower or any Subsidiary.
(c) Result in the creation or imposition of any Lien pursuant to the
provisions of any indenture, instrument, or agreement of which we are
aware and which is binding upon Borrower or any Subsidiary, other than
such as may be created pursuant to the Transaction Documents.
3. The Transaction Documents to which the Borrower is a party have been duly
executed and delivered by Borrower and constitute legal, valid, and binding
obligations of Borrower. The Transaction Documents to which each Subsidiary is a
party have been duly executed and delivered by the Subsidiary and constitute
legal, valid, and binding obligations of the Subsidiary. The Transaction
Documents to which Borrower or Any Subsidiary is a party are enforceable against
Borrower or the Subsidiary, as the case may be, in accordance with their
respective terms, except to the extent that the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity, regardless of whether enforcement is sought at law or in
equity. Notwithstanding the foregoing, no opinion is expressed with respect to
any provision that purports to consent to the jurisdiction of any court, waive
objections to venue, or require payment or reimbursement of attorneys' fees,
court costs, or other expenses of collection or enforcement.
4. To our knowledge, there is no litigation or proceeding pending or threatened
against the Borrower or any of the Subsidiaries which, if adversely determined,
could reasonably be expected to have a material adverse effect or which involve
the Credit Agreement, any Other Transaction Document, or the transactions
contemplated thereby.
5. No approval, authorization, consent, adjudication, or order of any
Governmental Authority, which has not been obtained by the Borrower or any
Subsidiary, is required to be obtained by any of them in connection with the
transactions contemplated by the Credit Agreement.
6. The Guarantee and Collateral Agreement creates a valid security interest
under Section 9-201 of the Uniform Commercial Code in favor of the Collateral
Agent, in all right, title, and interest, if any, of the Borrower and the
Subsidiaries in those items and types of personal property constituting the
Collateral, as such term is defined in the Guarantee and Collateral Agreement,
in which a security interest may be created under Article 9 of the Uniform
Commercial Code and the federal trademark laws, rules, and regulations, as the
case may be. Upon the filing and proper indexing of the Financing Statements in
the office of the Secretary of State of Delaware, the Collateral Agent will have
a perfected security interest in that portion of the Collateral in which a
security interest may be perfected by filing a financing statement under
Article 9 of the Uniform Commercial Code of the State of Delaware, in effect on
the date hereof (the "Delaware UCC").
We express no opinion with respect to (i) the perfection or priority of liens on
the Collateral, except as set forth in the preceding sentence; or (ii) the
creation, attachment or perfection of Liens on any Collateral consisting of
fixtures, within the meaning of Article 9 of the Uniform Commercial Code or the
Delaware UCC, or any Collateral located outside of the United States or
consisting of any intellectual property subject to the laws of any jurisdiction
other than the federal laws of the United States. Furthermore, the opinions set
forth herein are subject to the following qualifications:
a. We express no opinion as to title or interest in any property, real or
personal.
b. We call to your attention that (i) the perfection of the Collateral
Agent's security interest in the Collateral will be terminated as to any such
property acquired by any Borrower or Subsidiary more than four months after such
party changes its name so as to make the respective Financing Statement
seriously misleading unless amendments indicating the new name of such debtor
are properly filed before the expiration of such four month period, and (ii) the
Delaware UCC requires the filing of continuation statements within the period of
six months prior to the expiration of five years from the date of the filing of
the original Financing Statements or the expiration of any subsequent period of
continuation in order to maintain the effectiveness of the original Financing
Statements.
C. The opinion set forth in paragraph 6 above is given on the assumptions
that value has been given by the Collateral Agent and Lenders to the Borrower
and Subsidiaries and that the Borrower and Subsidiaries have rights in the
Collateral. Our opinions with respect to the proper filing office for the
Financing Statements is limited to the Delaware UCC.
d. We express no opinion as to the creation or perfection of a security
interest in any commercial tort claim.
e. We express no opinion with respect to (A) the creation, attachment or
perfection of any security interest (1) in any Collateral of a type represented
by a certificate of title, (2) in any proceeds, and (3) in any Collateral
consisting of money or Permitted Investments; or (B) the effect of Section 552
of the Bankruptcy Code (11 U.S.C. 552) (relating to property acquired by a
debtor after the commencement of a case under the United States Bankruptcy Code
with respect to such debtor) and Section 506(c) of the Bankruptcy Code (11
U.S.C. 506(c)) (relating to certain costs and expenses of a trustee in
preserving or disposing of collateral).
We are members of the bar of the State of Ohio, and we express no opinion as to
matters governed by any laws other than those of the State of Ohio, the federal
laws of the United States, the corporate and limited liability company laws of
the State of Delaware, and the Delaware UCC. As to matters involving the laws of
any other jurisdiction, we have assumed with your consent that the laws of that
jurisdiction are the same as the laws of the State of Ohio in all respects
material to this opinion; however, for purposes of this opinion, we express no
opinion as to any matter involving choice of law or conflicts of law.
The opinions that are expressed herein are as of the date hereof, are solely for
your benefit, and may not be relied upon in any manner for any purpose by any
person or entity other than the Administrative Agent, the Co-Administrative
Agent, the Collateral Agent, the Lenders, and their participants, assignees, and
other transferees. We disclaim any undertaking or obligation to advise you of
any changes in the conclusions or other matters covered herein that hereafter
may come to our attention.
Very truly yours,
SCHEDULE 4.01(f)
================================================================================
GUARANTEE AND COLLATERAL AGREEMENT
made by
TBC CORPORATION
and certain of its Subsidiaries
in favor of
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ BANK,
as Collateral Agent
Dated as of March 31, 2003
================================================================================
TABLE OF CONTENTS
Page
----
Section 1. DEFINED TERMS.................................................................................. 5
1.1 Definitions.................................................................................... 5
1.2 Other Definitional Provisions.................................................................. 9
Section 2. Guarantee...................................................................................... 9
2.1 Guarantee...................................................................................... 9
2.2 Right of Contribution.......................................................................... 10
2.3 No Subrogation................................................................................. 10
2.4 Amendments, etc. with respect to the Borrower Obligations...................................... 11
2.5 Guarantee Absolute and Unconditional........................................................... 11
2.6 Remedies....................................................................................... 12
2.7 Reinstatement.................................................................................. 12
2.8 Payments....................................................................................... 12
2.9 Application of Guarantee Payments and Recoveries............................................... 12
Section 3. GRANT OF SECURITY INTEREST..................................................................... 13
Section 4. REPRESENTATIONS AND WARRANTIES................................................................. 14
4.1 Execution, Delivery and Performance............................................................ 14
4.2 Title; No Other Liens.......................................................................... 14
4.3 Perfected First Priority Liens................................................................. 15
4.4 Jurisdiction of Organization; Chief Executive Office........................................... 15
4.5 Farm Products.................................................................................. 15
4.6 Investment Property............................................................................ 15
4.7 Receivables.................................................................................... 16
4.8 Intellectual Property.......................................................................... 16
Section 5. COVENANTS...................................................................................... 16
5.1 Delivery of Instruments, Certificated Securities and Chattel Paper............................. 16
5.2 Maintenance of Insurance....................................................................... 16
5.3 Payment of Obligations......................................................................... 17
5.4 Maintenance of Perfected Security Interest; Further Documentation.............................. 17
5.5 Changes in Locations, Name, etc................................................................ 17
i
5.6 Notices........................................................................................ 17
5.7 Investment Property............................................................................ 18
5.8 Intellectual Property.......................................................................... 18
Section 6. REMEDIAL PROVISIONS............................................................................ 19
6.1 Certain Matters Relating to Receivables........................................................ 19
6.2 Communications with Obligors; Grantors Remain Liable........................................... 19
6.3 Pledged Stock.................................................................................. 20
6.4 Proceeds to be Turned Over To Collateral Agent................................................. 21
6.5 Application of Proceeds........................................................................ 21
6.6 Code and Other Remedies........................................................................ 21
6.7 Sale of Pledged Stock.......................................................................... 22
6.8 Deficiency..................................................................................... 22
Section 7. THE COLLATERAL AGENT........................................................................... 22
7.1 Collateral Agent's Appointment as Attorney-in-Fact, etc........................................ 22
7.2 Duty of Collateral Agent....................................................................... 24
7.3 Execution of Financing Statements.............................................................. 24
7.4 Authority of Collateral Agent.................................................................. 24
Section 8. MISCELLANEOUS.................................................................................. 24
8.1 Amendments in Writing.......................................................................... 24
8.2 Notices........................................................................................ 24
8.3 No Waiver by Course of Conduct; Cumulative Remedies............................................ 25
8.4 Enforcement Expenses; Indemnification.......................................................... 25
8.5 Successors and Assigns......................................................................... 25
8.6 Set-Off........................................................................................ 25
8.7 Counterparts................................................................................... 26
8.8 Severability................................................................................... 26
8.9 Section Headings............................................................................... 26
8.10 Integration.................................................................................... 26
8.11 GOVERNING LAW.................................................................................. 26
8.12 Submission To Jurisdiction; Waivers............................................................ 26
8.13 Acknowledgements............................................................................... 27
8.14 Additional Grantors............................................................................ 27
8.15 Releases....................................................................................... 27
8.16 WAIVER OF JURY TRIAL........................................................................... 28
8.17 Continuation of Liens Securing Existing Prudential Notes....................................... 28
8.18 Existing Guarantees............................................................................ 28
SCHEDULES
Schedule 1 Notice Addresses
Schedule 2 Pledged Stock
Schedule 3 Jurisdictions of Organization and Chief Executive Offices
Schedule 4 Intellectual Property
GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of March 31,
2003, made by each of the signatories hereto (together with any other entity
that may become a party hereto as provided herein, the "Grantors"), in favor of
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, as Collateral Agent (in such capacity, the "Collateral
Agent") for (i) the banks and other financial institutions or entities (the
"Lenders") from time to time parties to the Credit Agreement, dated as of March
31, 2003 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among TBC Corporation (the "Borrower"), the Lenders, the
Administrative Agent and the Co-Administrative Agent and (ii) The Prudential
Insurance Company of America ("Prudential") party to the Second Amended and
Restated Note Agreement dated as of April 1, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Existing Note Agreement") between
Prudential and the Borrower and party to the Note Purchase Agreement dated as of
April 1, 2003 (as amended, supplemented or otherwise modified from time to time,
the "Additional Note Agreement") among Prudential, certain affiliates, managed
accounts or funds of Prudential (the "Prudential Affiliates") and the Borrower
(the Existing Note Agreement and the Additional Note Agreement collectively
referred to as the "Note Agreements") (the Lenders, Prudential and the
Prudential Affiliates being collectively referred to as the "Secured Parties").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make extensions of credit to the Borrower upon the terms and
subject to the conditions set forth therein;
WHEREAS, pursuant to the Existing Note Agreement, the Borrower
has outstanding certain Series A Senior Notes, Series B Senior Notes and Series
C Senior Notes (as amended, supplemented or otherwise modified from time to
time, the foregoing collectively referred to as the "Existing Prudential Notes")
held by Prudential;
WHEREAS, the Existing Prudential Notes are presently secured
by, inter alia, certain liens granted by the Grantors pursuant to those certain
Amended and Restated Security Agreements (the "Existing Security Agreements"),
each dated as of January 5, 2001, from the Borrower and each of the other
Grantors party hereto, in favor of the Collateral Agent;
WHEREAS, pursuant to the Additional Note Agreement, the
Borrower has issued to Prudential certain Series D Variable Rate Senior Secured
Notes due April 16, 2009 (as amended, supplemented or otherwise modified from
time to time, the "Additional Prudential Notes");
WHEREAS, the Borrower is a member of an affiliated group of
companies that includes, or with regard to Merchant's, Incorporated and Merban,
Inc., that will include upon completion of the Merchant's Acquisition, each
other Grantor;
WHEREAS, the proceeds of the extensions of credit under the
Credit Agreement and the proceeds from the issuance of the Additional Prudential
Notes will be used in part to enable the Borrower to make valuable transfers to
one or more of the other Grantors in connection with the operation of their
respective businesses;
WHEREAS, the Borrower has requested that Prudential consent to
the Borrower's execution of the Credit Agreement, which consent is required
under the Existing
Note Agreement, and Prudential has agreed to provide such consent, provided,
inter alia, that the Grantors shall have executed and delivered this Agreement
to the Collateral Agent for the ratable benefit of the Secured Parties;
WHEREAS, the Borrower and the other Grantors are engaged in
related businesses, and each Grantor will derive substantial direct and indirect
benefit from the making of the extensions of credit under the Credit Agreement,
and the issuance of Additional Prudential Notes under the Additional Note
Agreement;
WHEREAS, it is a condition precedent to the obligation of the
Lenders to make their respective extensions of credit to the Borrower under the
Credit Agreement, the amendment and restatement of the Existing Prudential Notes
under the Existing Note Agreement and the issuance of Additional Prudential
Notes under the Additional Note Agreement that the Grantors shall have executed
and delivered this Agreement to the Collateral Agent for the ratable benefit of
the Secured Parties; and
NOW, THEREFORE, in consideration of the premises and to induce
the Lenders to enter into the Credit Agreement and to make their respective
extensions of credit to the Borrower thereunder and to induce Prudential to give
its consent required under the Existing Note Agreement and to purchase the
Additional Prudential Notes under the Additional Note Agreement, each Grantor
hereby agrees with the Collateral Agent, for the ratable benefit of the Secured
Parties, as follows:
ARTICLE I DEFINED TERMS
SECTION 1.01. Definitions. (a) The following terms are used
herein as defined in the New York UCC: Accounts, Certificated Security, Chattel
Paper, Commercial Tort Claims, Documents, Equipment, Farm Products, General
Intangibles, Instruments, Inventory, Letter-of-Credit Rights and Supporting
Obligations.
(a) The following terms shall have the following meanings:
"ABR Loans": as defined in the Credit Agreement. "Additional
Note Agreement": as defined in the Preamble hereto.
"Additional Prudential Notes": as defined in the recitals
hereto.
"Administrative Agent": as defined in the Credit Agreement.
"Agreement": this Guarantee and Collateral Agreement, as the
same may be amended, supplemented or otherwise modified from time to time.
"Borrower": as defined in the preamble hereto.
"Borrower Obligations": the collective reference to the unpaid
principal of and interest on the Prudential Notes, the Loans and Reimbursement
Obligations and all other obligations and liabilities of the Borrower
(including, without limitation, interest accruing at the then applicable rate
provided in the Credit Agreement, the Note Agreements and the Prudential Notes
after the maturity of the Loans, the Reimbursement Obligations and the
Prudential Notes and interest accruing at the then applicable rate provided in
the Credit Agreement after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) to the Collateral Agent or any Secured Party,
whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Credit Agreement, the Note Agreements, the Prudential Notes, this
Agreement, any Mortgage, any Letter of Credit and any guarantee of the
Borrower's obligations in respect of any of the foregoing as from time to time
in effect, or any other document made, delivered or given in connection with any
of the foregoing, in each case whether on account of principal, interest,
reimbursement obligations, Make-Whole Amounts, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements
of counsel to the Collateral Agent or to the Secured Parties that are required
to be paid by the Borrower pursuant to the terms of any of the foregoing
agreements) (collectively, the "Loan Documents").
"Business Day": as defined in the Credit Agreement.
"Capital Stock" shall mean any class of capital stock, share
capital or similar equity interest of a Person.
"Co-Administrative Agent": as defined in the Credit Agreement.
"Collateral": as defined in Section 3.
"Collateral Account": any collateral account established by
the Collateral Agent as provided in Section 6.1 or 6.4.
"Collateral Agent": as defined in the Preamble hereto.
"Copyrights": (i) all copyrights arising under the laws of the
United States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished (including,
without limitation, those listed in Schedule 4), all registrations and
recordings thereof, and all applications in connection therewith, including,
without limitation, all registrations, recordings and applications in the United
States Copyright Office, and (ii) the right to obtain all renewals thereof.
"Commitments": as defined in the Credit Agreement.
"Credit Agreement": as defined in the preamble hereto.
"Default": shall mean a "Default" as defined in the Credit
Agreement or in either of the Note Agreements.
"Deposit Account": as defined in the Uniform Commercial Code
of any applicable jurisdiction and, in any event, including, without limitation,
any demand, time, savings, passbook or like account maintained with a depositary
institution.
"Event of Default": shall mean an "Event of Default" as
defined in the Credit Agreement or in either of the Note Agreements.
"Existing Note Agreement": as defined in the Preamble hereto.
"Existing Security Agreements": as defined in the recitals
hereto.
"Existing Prudential Notes": as defined in the recitals
hereto.
"Foreign Subsidiary": any Subsidiary organized under the laws
of any jurisdiction outside the United States of America.
"Foreign Subsidiary Voting Stock": the voting Capital Stock of
any Foreign Subsidiary.
"GAAP": as defined in the Credit Agreement.
"Governmental Authority": as defined in the Credit Agreement.
"Grantors": as defined in the preamble hereto.
"Guarantee": as defined in Section 2.1(a).
"Guarantor Obligations": with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, Section 2), the
Note Agreements, the Prudential Notes or any other Loan Document to which such
Guarantor is a party, in each case whether on account of guarantee obligations,
reimbursement obligations, Make-Whole Amounts, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements
of counsel to the Collateral Agent or to the Secured Parties that are required
to be paid by such Guarantor pursuant to the terms of this Agreement, the Note
Agreements or any other Loan Document).
"Guarantors": the collective reference to each Grantor other
than the Borrower, Merchant's Incorporated and Merban, Inc.
"Guarantee Related Payment": as defined in Section 2.9.
"Intellectual Property": the collective reference to all
rights, priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including, without limitation, the Copyrights, the Patents and the Trademarks,
and all rights to ▇▇▇ at law or in equity for any infringement or other
impairment thereof, including the right to receive all proceeds and damages
therefrom.
"Intercompany Note": any promissory note evidencing loans made
by any Grantor to the Borrower or any of its Subsidiaries.
"Intercreditor Agreement": the Intercreditor Agreement among
Prudential, each Lender, the Administrative Agent, the Co-Administrative Agent
and the Collateral Agent, dated as of March 31, 2003.
"Investment Property": the collective reference to (i) all
"investment property" as such term is defined in Section 9-102(a)(49) of the New
York UCC (other than any Foreign Subsidiary Voting Stock excluded from the
definition of "Pledged Stock") and (ii) whether or not constituting "investment
property" as so defined, all Pledged Notes and all Pledged Stock.
"Issuers": the collective reference to each issuer of any
Investment Property.
"Letter of Credit": as defined in the Credit Agreement.
"Lender Party": as defined in Section 2.6.
"Lenders": as defined in the preamble hereto.
"Lien": as defined in the Credit Agreement.
"Loan Document(s)" is defined within the definition of
"Borrower Obligations".
"Loans": as defined in the Credit Agreement.
"Make-Whole Amount": as defined in the Note Agreements.
"Mortgage": as defined in the Credit Agreement.
"New York UCC": the Uniform Commercial Code as from time to
time in effect in the State of New York.
"Note Agreements": as defined in the Preamble hereto.
"Obligations": (i) in the case of the Borrower, Merchant's
Incorporated and Merban, Inc., the Borrower Obligations, and (ii) in the case of
each Guarantor, its Guarantor Obligations.
"Patents": (i) all letters patent of the United States, any
other country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without limitation,
any of the foregoing referred to in Schedule 4, (ii) all applications for
letters patent of the United States or any other country and all divisions,
continuations and continuations-in-part thereof, including, without limitation,
any of the foregoing referred to in Schedule 4, and (iii) all rights to obtain
any reissues or extensions of the foregoing.
"Person": shall mean and include an individual, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization, a
limited liability company and a government or any department or agency thereof.
"Pledged Notes": all Intercompany Notes at any time issued to
any Grantor and all other promissory notes issued to or held by any Grantor
(other than promissory notes issued in connection with extensions of trade
credit by any Grantor in the ordinary course of business).
"Pledged Stock": the shares of Capital Stock listed on
Schedule 2, together with any other shares, stock certificates, options,
interests or rights of any nature whatsoever in respect of the Capital Stock of
any Person that may be issued or granted to, or held by, any Grantor while this
Agreement is in effect; provided that in no event shall more than 66% of the
total outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary be
required to be pledged hereunder.
"Proceeds": all "proceeds" as such term is defined in Section
9-102(a)(64) of the New York UCC and, in any event, shall include, without
limitation, all dividends or other income from the Investment Property,
collections thereon or distributions or payments with respect thereto.
"Prudential": as defined in the Preamble hereto.
"Prudential Affiliates": as defined in the Preamble hereto.
"Prudential Notes": the collective reference to the Existing
Prudential Notes and the Additional Prudential Notes.
"Receivable": any right to payment for goods sold or leased or
for services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance
(including, without limitation, any Account).
"Reimbursement Obligations": as defined in the Credit
Agreement.
"Required Lenders": as defined in the Credit Agreement.
"Required Noteholders": shall mean the holder or holders of at
least 51% of the aggregate principal amount of each of the Existing Prudential
Notes and the Additional Prudential Notes.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Secured Parties": as defined in the Preamble hereto.
"Securities Act": the Securities Act of 1933, as amended.
"Subsidiary": as defined in the Credit Agreement.
"Trademarks": (i) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, including, without limitation, any of the foregoing
referred to in Schedule 4, and (ii) the right to obtain all renewals thereof.
SECTION 1.02. Other Definitional Provisions. (b) The words
"hereof," "herein", "hereto" and "hereunder" and words of similar import when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section and Schedule references are
to this Agreement unless otherwise specified.
(a) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
(b) Where the context requires, terms relating to the
Collateral or any part thereof, when used in relation to a Grantor, shall refer
to such Grantor's Collateral or the relevant part thereof.
ARTICLE II GUARANTEE
SECTION 2.01. Guarantee. (c) Each of the Guarantors hereby,
jointly and severally, unconditionally and irrevocably, guarantees (the
"Guarantee") to the Secured Parties and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Borrower Obligations.
(a) Anything herein or in any other Loan Document or the
Intercreditor Agreement to the contrary notwithstanding, the maximum liability
of each Guarantor hereunder and under the other Loan Documents or the
Intercreditor Agreement shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws
relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 2.2).
(b) Each Guarantor agrees that the Borrower Obligations may at
any time and from time to time exceed the amount of the liability of such
Guarantor hereunder without impairing the guarantee contained in this Section 2
or affecting the rights and remedies of the Collateral Agent or any Secured
Party hereunder. Each Guarantor shall give notice at the time of any payment by
it hereunder to the recipient of such payment and to the Collateral Agent.
(c) The guarantee contained in this Section 2 shall remain in
full force and effect until all the Borrower Obligations and the obligations of
each Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by payment in full, no Letter of Credit shall be outstanding and the
Commitments shall be terminated, notwithstanding that from time to time during
the term of the Credit Agreement or the Note Agreements the Borrower may be free
from any Borrower Obligations.
(d) No payment made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Collateral Agent or any Secured Party from the Borrower, any of the Guarantors,
any other guarantor or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Borrower Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment, remain liable for the
Borrower Obligations up to the maximum liability of such Guarantor hereunder
until the Borrower Obligations are paid in full, no Letter of Credit shall be
outstanding and the Commitments are terminated.
SECTION 2.02. Right of Contribution. Each Guarantor hereby
agrees that to the extent that a Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Guarantor shall be
entitled to seek and receive contribution from and against any other Guarantor
hereunder which has not paid its proportionate share of such payment. Each
Guarantor's right of contribution shall be subject to the terms and conditions
of Section 2.3. The provisions of this Section 2.2 shall in no respect limit the
obligations and liabilities of any Guarantor to the Collateral Agent and the
Secured Parties, and each Guarantor shall remain liable to the Collateral Agent
and the Lenders for the full amount guaranteed by such Guarantor hereunder.
SECTION 2.03. No Subrogation. Notwithstanding any payment made
by any Guarantor hereunder or any set-off or application of funds of any
Guarantor by the Collateral Agent or any Secured Party, no Guarantor shall be
entitled to be subrogated to any of the rights of the Collateral Agent or any
Secured Party against the Borrower or any other Guarantor or any collateral
security or guarantee or right of offset held by the Collateral Agent or any
Secured Party for the payment of the Borrower Obligations, nor shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from the
Borrower or any other Guarantor in respect of payments made by such Guarantor
hereunder, until all amounts owing to the Collateral Agent and the Secured
Parties by the Borrower on account of the Borrower Obligations are paid in full,
no Letter of Credit shall be outstanding and the Commitments are terminated. If
any amount shall be paid to any Guarantor on account of such subrogation rights
at any time when all of the Borrower Obligations shall not have been paid in
full, such amount shall be held by such Guarantor in trust for the Collateral
Agent and the Secured Parties, segregated from other funds of such Guarantor,
and shall, forthwith upon receipt by such Guarantor, be turned over to the
Collateral Agent in the exact form received by such Guarantor (duly indorsed by
such Guarantor to the Collateral Agent, if required), to be applied against the
Borrower Obligations, whether matured or unmatured, in such order as the
Collateral Agent may determine.
SECTION 2.04. Amendments, etc. with respect to the Borrower
Obligations. Each Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against any Guarantor and without notice
to or further assent by any Guarantor, any demand for payment of any of the
Borrower Obligations made by the Collateral Agent or any Secured Party may be
rescinded by the Collateral Agent or such Secured Party and any of the Borrower
Obligations continued, and the Borrower Obligations, or the liability of any
other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Collateral Agent or any
Secured Party, and the Credit Agreement, the Note Agreements, the Prudential
Notes and the other Loan Documents and any other documents executed and
delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, and any collateral security, guarantee or right
of offset at any time held by the Collateral Agent or any Secured Party for the
payment of the Borrower Obligations may be sold, exchanged, waived, surrendered
or released. Neither the Collateral Agent nor any Secured Party shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for the Borrower Obligations or for the guarantee contained in this
Section 2 or any property subject thereto.
SECTION 2.05. Guarantee Absolute and Unconditional. Each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Borrower Obligations and notice of or proof of reliance by
the Collateral Agent or any Secured Party upon the guarantee contained in this
Section 2 or acceptance of the guarantee contained in this Section 2; the
Borrower Obligations, and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in
reliance upon the guarantee contained in this Section 2; and all dealings
between the Borrower and any of the Guarantors, on the one hand, and the
Collateral Agent and the Secured Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 2. Each Guarantor waives diligence,
presentment, protest, demand for payment and notice of default or nonpayment to
or upon the Borrower or any of the Guarantors with respect to the Borrower
Obligations. Each Guarantor understands and agrees that the guarantee contained
in this Section 2 shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity or enforceability of the
Credit Agreement, the Note Agreements, the Prudential Notes or any other Loan
Document, any of the Borrower Obligations or any collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to
time held by the Collateral Agent or any Secured Party, (b) any defense, set-off
or counterclaim (other than a defense of payment or performance in full) which
may at any time be available to or be asserted by the Borrower or any other
Person against the Collateral Agent or any Secured Party, or (c) any other
circumstance whatsoever (with or without notice to or knowledge of the Borrower
or such Guarantor) which constitutes, or might be construed to constitute, an
equitable or legal discharge of the Borrower for the Borrower Obligations, or of
such Guarantor under the guarantee contained in this Section 2, in bankruptcy or
in any other instance. When making any demand hereunder or otherwise pursuing
its rights and remedies hereunder against any Guarantor, the Collateral Agent or
any Secured Party may, but shall be under no obligation to, make a similar
demand on or otherwise pursue such rights and remedies as it may have against
the Borrower, any other Guarantor or any other Person or against any collateral
security or guarantee for the Borrower Obligations or any right of offset with
respect thereto, and any failure by the Collateral Agent or any Secured Party to
make any such demand, to pursue such other rights or remedies or to collect any
payments from the Borrower, any other Guarantor or any other Person or to
realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Borrower, any other Guarantor or any
other Person or any such collateral security, guarantee or right of offset,
shall not relieve any Guarantor of any obligation or liability hereunder, and
shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Collateral Agent or any Secured Party
against any Guarantor. For the purposes hereof "demand" shall include the
commencement and continuance of any legal proceedings.
SECTION 2.06. Remedies. Any one or more of Prudential, each
Prudential Affiliate and the Co-Administrative Agent (for the benefit of the
Lenders) (each a "Lender Party") may, either individually or collectively, seek
to enforce the Obligations of any Guarantor under and in respect of the
Guarantee. No Lender Party shall be required to (a) prosecute collection or seek
to enforce or resort to any remedies against the Borrower or any other Person
liable on any of the Obligations, (b) join the Borrower or any other Person
liable on any of the Obligations in any action in which any Lender Party
prosecutes collection or seeks to enforce or resort to any remedies against the
Borrower or other Person liable on any of the Obligations, or (c) seek to
enforce or resort to any remedies with respect to any Liens granted to (or
benefiting, directly or indirectly) any Lender Party or any other Person liable
on any of the Obligations.
SECTION 2.07. Reinstatement. The guarantee contained in this
Section 2 shall continue to be effective, or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any of the Borrower Obligations
is rescinded or must otherwise be restored or returned by the Collateral Agent
or any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation
or reorganization of the Borrower or any Guarantor, or upon or as a result of
the appointment of a receiver, intervenor or conservator of, or trustee or
similar officer for, the Borrower or any Guarantor or any substantial part of
its property, or otherwise, all as though such payments had not been made.
SECTION 2.08. Payments. Each Guarantor hereby guarantees that
payments hereunder (a) in respect of the Credit Agreement, the Loans and the
Reimbursement Obligations, will be paid to the Collateral Agent without set-off
or counterclaim in Dollars at the Funding Office, and (b) in respect of the Note
Agreements and the Prudential Notes, will be paid to the holders of the
Prudential Notes, without set-off or counterclaim, in the manner provided in the
Note Agreements.
Application of Guarantee Payments and Recoveries
(a) Each payment or other recovery from a Guarantor under or
in respect of its obligations under this Section 2 (each, a "Guarantee Related
Payment") shall belong to each Secured Party, in accordance with their
respective "Proportionate Shares", as defined below. If any Secured Party shall
obtain any payment or other recovery (whether voluntary, involuntary, by
application of set-off or otherwise) on account of the Guarantee in excess of
its Proportionate Share of all payments then or thereafter obtained by the
Secured Parties with respect to the Guarantee, then such party shall give prompt
notice to the Collateral Agent indicating the payment or other recovery
obtained. Such Secured Party shall purchase from the other Secured Parties such
participation in the indebtedness of the Guarantors under this Agreement as
shall be necessary to cause such purchasing party to share such payment or other
recovery ratably, based on all Proportionate Shares, with all of the Secured
Parties; provided, however, that if all or any portion of such payment or other
recovery is thereafter recovered from such purchasing party, the purchase price
shall be rescinded, and each other Secured Party shall repay to the purchasing
party the purchase price, to the ratable extent of such recovery in proportion
to the amount received by such other Secured Party, together with an amount
equal to such Secured Party's ratable share (according to the proportion of (x)
the amount of such Secured Party's required repayment to the purchasing party to
(y) the total amounts recovered from the purchasing party) of any interest or
other amount paid or payable by the purchasing party in respect of the total
amount so recovered.
The term "Proportionate Share", as used herein, shall
mean at any time, for each Secured Party, a fraction
(a) the numerator of which is the aggregate principal
amount of the Obligations held by such party at such
time, and (b) the denominator of which is the
aggregate principal amount of the Obligations held by
all Secured Parties at such time.
ARTICLE III GRANT OF SECURITY INTEREST
Each Grantor hereby assigns and transfers to the Collateral
Agent, and hereby grants to the Collateral Agent, for the ratable benefit of the
Secured Parties, a security interest in, all of the following property now owned
or at any time hereafter acquired by such Grantor or in which such Grantor now
has or at any time in the future may acquire any right, title or interest
(collectively, the "Collateral"), as collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor's Obligations:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Deposit Accounts;
(d) all Documents (other than title documents with respect to
vehicles);
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments;
(h) all Intellectual Property;
(i) all Inventory;
(j) all Investment Property;
(k) all Letter-of-Credit Rights;
all Commercial Tort Claims;
(l) all other property not otherwise described above;
(m) all books and records pertaining to the Collateral; and
(n) to the extent not otherwise included, all Proceeds,
Supporting Obligations and products of any and all of the foregoing and all
collateral security and guarantees given by any Person with respect to any of
the foregoing;
provided, however, that notwithstanding any of the other
provisions set forth in this Section 3, this Agreement shall not constitute a
grant of a security interest in any property to the extent that such grant of a
security interest is prohibited by any Requirements of Law of a Governmental
Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach
or default under or results in the termination of or requires any consent not
obtained under, any contract, license,
agreement, instrument or other document evidencing or giving rise to such
property or, in the case of any Investment Property, Pledged Stock or Pledged
Note, any applicable shareholder or similar agreement, except to the extent that
such Requirement of Law or the term in such contract, license, agreement,
instrument or other document or shareholder or similar agreement providing for
such prohibition, breach, default or termination or requiring such consent is
ineffective under applicable law.
ARTICLE IV REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter
into the Credit Agreement and to make their respective extensions of credit to
the Borrower thereunder and to induce Prudential to give its consent under, and
to amend and restate, the Existing Note Agreement and to purchase the Additional
Prudential Notes under the Additional Note Agreement, each Grantor hereby
represents and warrants to the Collateral Agent and each Secured Party that:
SECTION 4.01. Execution, Delivery and Performance. (d) The
execution, delivery and performance by it of this Agreement have been duly
authorized by all necessary corporate action and do not and will not contravene
its bylaws or its articles of incorporation.
(a) The execution, delivery and performance by such Grantor of
this Agreement do not and will not contravene applicable law or, except as
permitted under the Credit Agreement and the Note Agreements, any contractual
restriction binding on or affecting such Grantor or any of its properties, and
do not and will not result in or require the creation of any Lien, security
interest or other charge of encumbrance upon or with respect to any of such
Grantor's properties except as may be created by this Agreement.
(b) Except with regard to Liens permitted to exist on the
Collateral by the Credit Agreement and the Note Agreements, no authorization or
approval or other action by, and no notice to or filing with, any Person or
entity not otherwise obtained is required for the due execution, delivery and
performance by such Grantor of this Agreement.
(c) This Agreement is a legal, valid and binding obligation of
such Grantor, enforceable against such Grantor, in accordance with its terms.
(d) There is no action, suit or proceeding pending or, to the
knowledge of such Grantor, threatened against or otherwise affecting it before
any Governmental Authority or arbitrator which would prohibit the execution,
delivery and performance by it of this Agreement.
(e) Such Grantor (other than the Borrower) and the Borrower
are separately incorporated or organized entities that operate independently
from each other. Such Grantor (other than the Borrower) utilizes certain
accounting, cash management, management and other operational and organizational
functions of the Borrower for operational and organizational efficiency, as well
as to assist in the preparation of tax returns on a consolidated basis. In the
event these functions were no longer provided to such Grantor by the Borrower,
such Grantor would need to make the necessary adjustments in its operations and
organizational functions, in order to replace such functions. The majority of
the purchasing functions of such Grantor are handled by the Borrower, although
some of these functions may be occasionally shared for efficiency or as special
circumstances warrant.
SECTION 4.02. Title; No Other Liens Except for the security
interest granted to the Collateral Agent for the ratable benefit of the Secured
Parties pursuant to this Agreement and the other Liens permitted to exist on the
Collateral by the Credit Agreement and the Note Agreements, such Grantor owns
each item of the Collateral free and clear of any and all Liens or claims of
others. Except (i) with regard to Liens permitted to exist on the Collateral by
the Credit Agreement and the Note
Agreements, and (ii) for financing statements evidencing operating lease
transactions, no financing statement or other public notice with respect to all
or any part of the Collateral is on file or of record in any public office,
except such as have been filed in favor of the Collateral Agent, for the ratable
benefit of the Secured Parties, pursuant to this Agreement or as are permitted
by the Credit Agreement and the Note Agreements. For the avoidance of doubt, it
is understood and agreed that any Grantor may, as part of its business, grant
licenses to third parties to use Intellectual Property owned or developed by a
Grantor. For purposes of this Agreement and the other Loan Documents, such
licensing activity shall not constitute a "Lien" on such Intellectual Property.
Each of the Collateral Agent and each Secured Party understands that any such
licenses may be exclusive to the applicable licensees, and such exclusivity
provisions may limit the ability of the Collateral Agent to utilize, sell, lease
or transfer the related Intellectual Property or otherwise realize value from
such Intellectual Property pursuant hereto.
SECTION 4.03. Perfected Priority Liens. The security interests
granted pursuant to this Agreement (a) to the extent they can be perfected under
the UCC, constitute valid perfected security interests in all of the Collateral
in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, as collateral security for such Grantor's Obligations, enforceable in
accordance with the terms hereof and (b) are prior to all other Liens on the
Collateral in existence on the date hereof except for Liens permitted by the
Credit Agreement and the Note Agreements and unrecorded Liens which have
priority over the Liens on the Collateral by operation of law.
SECTION 4.04. Jurisdiction of Organization; Chief Executive
Office. On the date hereof, such Grantor's jurisdiction of organization,
identification number from the jurisdiction of organization (if any), and the
location of such Grantor's chief executive office or sole place of business or
principal residence, as the case may be, are specified on Schedule 3. Such
Grantor has furnished to the Collateral Agent a certified charter, certificate
of incorporation or other organization document and long-form good standing
certificate as of a date which is recent to the date hereof.
SECTION 4.05. Farm Products. None of the Collateral
constitutes, or is the Proceeds of, Farm Products.
SECTION 4.06. Investment Property. (e) The shares of Pledged
Stock pledged by such Grantor hereunder constitute all the issued and
outstanding shares of all classes of the Capital Stock of each Issuer owned by
such Grantor or, in the case of Foreign Subsidiary Voting Stock, if less, 66% of
the outstanding Foreign Subsidiary Voting Stock of each relevant Issuer.
(a) All the shares of the Pledged Stock have been duly and
validly issued and are fully paid and nonassessable.
(b) To the knowledge of the Grantors, each of the Pledged
Notes constitutes the legal, valid and binding obligation of the obligor with
respect thereto, enforceable in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(c) Such Grantor is the record and beneficial owner of, and
has good and marketable title to, the Investment Property pledged by it
hereunder, free of any and all Liens or
options in favor of, or claims of, any other Person, except the security
interest created by this Agreement.
SECTION 4.07. Receivables(a) . The amounts represented by such
Grantor to the Secured Parties from time to time as owing to such Grantor in
respect of the Receivables will at such times be accurate.
SECTION 4.08. Intellectual Property. Schedule 4 lists all
Intellectual Property owned by such Grantor in its own name on the date hereof,
other than Trademarks or Copyrights arising under common law or state law, as to
which no registration or other filing has been made.
ARTICLE V COVENANTS
Each Grantor covenants and agrees with the Collateral Agent
and the Secured Parties that, from and after the date of this Agreement until
the Obligations shall have been paid in full, no Letter of Credit shall be
outstanding and the Commitments shall have terminated:
SECTION 5.01. Delivery of Instruments, Certificated Securities
and Chattel Paper. If an Event of Default shall occur and be continuing and if
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any Instrument, Certificated Security or Chattel Paper, such
Instrument, Certificated Security or Chattel Paper shall be immediately
delivered to the Collateral Agent, duly indorsed in a manner satisfactory to the
Collateral Agent, to be held as Collateral pursuant to this Agreement.
SECTION 5.02. 1.2 Maintenance of Insurance. Such Grantor will
have and maintain insurance at its expense at all times and in such amounts, in
such form, containing such terms and written by such companies as may be
reasonably satisfactory to the Collateral Agent (and as more particularly set
forth in the Credit Agreement and the Note Agreements). All policies of
insurance shall be payable to the Collateral Agent and such Grantor, as its
interests may appear, shall name the Collateral Agent as a co-insured party, and
shall provide for thirty (30) days' written notice of cancellation or
modification to the Collateral Agent. So long as any Event of Default exists,
the Collateral Agent is authorized by such Grantor to act as its attorney in
collecting, adjusting, settling or canceling such insurance and endorsing any
drafts drawn by insurers. The Collateral Agent may apply any proceeds of
insurance received by it to the Obligations, whether due or not; provided,
however, that the Collateral Agent will hold such proceeds as a special deposit
for use by such Grantor to repair, restore or replace the assets which gave rise
to such proceeds, or to acquire other tangible assets to be used in such
Grantor's businesses, within one year after the event giving rise to such
proceeds, so long as (i) such Grantor is taking steps to repair, restore or
replace such Collateral, or to acquire such tangible assets, with due diligence
and in good faith and (ii) no Event of Default shall have occurred. Such Grantor
will immediately notify the Collateral Agent of any damage to or loss of
Collateral in excess of $5,000,000. Not later than ten (10) days prior to the
expiration date of each policy of insurance then in effect, such Grantor shall
deliver to the Collateral Agent a certificate of insurance certifying as to (i)
the extension of such policy or the issuance of a renewal policy therefor,
describing the same in reasonable detail satisfactory to the Collateral Agent
and (ii) the payment in full of the portion of the premium therefor then due and
payable (or accompanied by other proof of such payment satisfactory to the
Collateral Agent). Such Grantor shall be required forthwith to notify the
Collateral Agent (by telephone, confirmed in writing) if such Grantor shall
determine at any time not to, or at any time be unable to, extend or renew any
such policy then in effect. Notwithstanding the foregoing, such Grantor,
pursuant to Article Nine of the New York UCC, shall bear the risk of loss of
Collateral.
SECTION 5.03. 1.3 Payment of Obligations. Such Grantor will
pay and discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, all taxes, assessments and governmental
charges or levies imposed upon the Collateral or in respect of income or profits
therefrom, as well as all claims of any kind (including, without limitation,
claims for labor, materials and supplies) against or with respect to the
Collateral, except that no such charge need be paid if the amount or validity
thereof is currently being contested in good faith by appropriate proceedings,
reserves in conformity with GAAP with respect thereto have been provided on the
books of such Grantor and such proceedings could not reasonably be expected to
result in the sale, forfeiture or loss of any material portion of the Collateral
or any interest therein.
SECTION 5.04. Maintenance of Perfected Security Interest;
Further Documentation. (a) Such Grantor shall defend the security interest
created by this Agreement against the claims and demands of all Persons
whomsoever, subject to the rights of such Grantor under the Loan Documents to
dispose of the Collateral.
(a) Such Grantor will furnish to the Collateral Agent and the
Secured Parties from time to time statements and schedules further identifying
and describing the assets and property of such Grantor and such other reports in
connection therewith as the Collateral Agent or any Secured Party may reasonably
request, all in reasonable detail.
(b) At any time and from time to time, upon the written
request of the Collateral Agent, and at the sole expense of such Grantor, such
Grantor will promptly and duly execute and deliver, and have recorded, such
further instruments and documents and take such further actions as the
Collateral Agent may reasonably request for the purpose of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted, including, without limitation, (i) filing any financing or
continuation statements under the Uniform Commercial Code (or other similar
laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Investment Property, Deposit Accounts,
Letter-of-Credit Rights and any other relevant Collateral, taking any actions
necessary to enable the Collateral Agent to obtain "control" (within the meaning
of the applicable Uniform Commercial Code) with respect thereto.
SECTION 5.05. Changes in Locations, Name, etc. Such Grantor
will not, except upon 30 days' prior written notice to the Collateral Agent and
delivery to the Collateral Agent of all additional executed financing statements
and other documents reasonably requested by the Collateral Agent to maintain the
validity, perfection and priority of the security interests provided for herein:
(a) change its jurisdiction of organization or the location of
its chief executive office or sole place of business or principal
residence from that referred to in Section 4.4; or
(b) change its name.
SECTION 5.06. 1.4 Notices. Such Grantor will advise the
Collateral Agent and the Secured Parties promptly, in reasonable detail, of:
(a) any Lien (other than security interests created hereby or
Liens permitted under the Credit Agreement and the Note Agreements) on any of
the Collateral which would adversely affect the ability of the Collateral Agent
to exercise any of its remedies hereunder; and
(b) the occurrence of any other event which could reasonably
be expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
SECTION 5.07. Investment Property. (a) If such Grantor shall
become entitled to receive or shall receive any certificate (including, without
limitation, any certificate representing a dividend or a distribution in
connection with any reclassification, increase or reduction of capital or any
certificate issued in connection with any reorganization), option or rights in
respect of the Capital Stock of any Issuer, whether in addition to, in
substitution of, as a conversion of, or in exchange for, any shares of the
Pledged Stock, or otherwise in respect thereof, such Grantor shall accept the
same as the agent of the Collateral Agent and the Secured Parties, hold the same
in trust for the Collateral Agent and the Secured Parties and deliver the same
forthwith to the Collateral Agent in the exact form received, duly indorsed by
such Grantor to the Collateral Agent, if required, together with an undated
stock power covering such certificate duly executed in blank by such Grantor and
with, if the Collateral Agent so requests, signature guaranteed, to be held by
the Collateral Agent, subject to the terms hereof, as additional collateral
security for the Obligations. Any sums paid upon or in respect of the Investment
Property upon the liquidation or dissolution of any Issuer shall be paid over to
the Collateral Agent to be held by it hereunder as additional collateral
security for the Obligations, and in case any distribution representing a return
of capital shall be made on or in respect of the Investment Property or any
property shall be distributed upon or with respect to the Investment Property
pursuant to the recapitalization or reclassification of the capital of any
Issuer or pursuant to the reorganization thereof, the property so distributed
shall, unless otherwise subject to a perfected security interest in favor of the
Collateral Agent, be delivered to the Collateral Agent to be held by it
hereunder as additional collateral security for the Obligations. If any sums of
money or property so paid or distributed in respect of the Investment Property
shall be received by such Grantor, such Grantor shall, until such money or
property is paid or delivered to the Collateral Agent, hold such money or
property in trust for the Collateral Agent and the Secured Parties, segregated
from other funds of such Grantor, as additional collateral security for the
Obligations.
(a) Without the prior written consent of the Collateral Agent,
or unless otherwise permitted by the Loan Documents, such Grantor will not (i)
vote to enable, or take any other action to permit, any Issuer to issue any
Capital Stock of any nature or to issue any other securities convertible into or
granting the right to purchase or exchange for any Capital Stock of any nature
of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose of,
or grant any option with respect to, the Investment Property or Proceeds
thereof, (iii) create, incur or permit to exist any Lien or option in favor of,
or any claim of any Person with respect to, any of the Investment Property or
Proceeds thereof, or any interest therein, except for the security interests
created by this Agreement or (iv) enter into any agreement or undertaking
restricting the right or ability of such Grantor or the Collateral Agent to
sell, assign or transfer any of the Investment Property or Proceeds thereof.
(b) In the case of each Grantor which is an Issuer, such
Issuer agrees that (i) it will be bound by the terms of this Agreement relating
to the Investment Property issued by it and will comply with such terms insofar
as such terms are applicable to it, and (ii) it will notify the Collateral Agent
promptly in writing of the occurrence of any of the events described in Section
5.7(a) with respect to the Investment Property issued by it.
SECTION 5.08. Intellectual Property. Such Grantor will take
all reasonable and necessary steps, including, without limitation, in any
proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in any other country or
any political subdivision thereof, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of the
material Intellectual Property, including, without limitation, filing of
applications for renewal, affidavits of use and affidavits of incontestability.
ARTICLE VI REMEDIAL PROVISIONS
SECTION 6.01. Certain Matters Relating to Receivables. (b) At
any time after the occurrence and during the continuance of an Event of Default,
the Collateral Agent shall have the right to make test verifications of the
Receivables in any manner and through any medium that it reasonably considers
advisable, and each Grantor shall furnish all such assistance and information as
the Collateral Agent may require in connection with such test verifications. At
any time and from time to time, upon the Collateral Agent's request and at the
expense of the relevant Grantor, such Grantor shall cause independent public
accountants or others satisfactory to the Collateral Agent to furnish to the
Collateral Agent reports showing reconciliations, aging and test verifications
of, and trial balances for, the Receivables.
(a) The Collateral Agent hereby authorizes each Grantor to
collect such Grantor's Receivables, and the Collateral Agent may curtail or
terminate said authority at any time after the occurrence and during the
continuance of an Event of Default. If required by the Collateral Agent at any
time after the occurrence and during the continuance of an Event of Default, any
payments of Receivables, when collected by any Grantor, (i) shall be forthwith
(and, in any event, within two Business Days) deposited by such Grantor in the
exact form received, duly indorsed by such Grantor to the Collateral Agent if
required, in a Collateral Account maintained under the sole dominion and control
of the Collateral Agent, subject to withdrawal by the Collateral Agent for the
account of the Secured Parties only as provided in Section 6.5, and (ii) until
so turned over, shall be held by such Grantor in trust for the Collateral Agent
and the Secured Parties, segregated from other funds of such Grantor. Each such
deposit of Proceeds of Receivables shall be accompanied by a report identifying
in reasonable detail the nature and source of the payments included in the
deposit.
(b) At the Collateral Agent's request at any time after the
occurrence and during the continuance of an Event of Default, each Grantor shall
deliver to the Collateral Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Receivables,
including, without limitation, all original orders, invoices and shipping
receipts.
SECTION 6.02. Communications with Obligors; Grantors Remain
Liable. (c) The Collateral Agent in its own name or in the name of others may at
any time after the occurrence and during the continuance of an Event of Default
communicate with obligors under the Receivables to verify with them to the
Collateral Agent's satisfaction the existence, amount and terms of any
Receivables.
(a) Upon the request of the Collateral Agent at any time after
the occurrence and during the continuance of an Event of Default, each Grantor
shall notify obligors on the Receivables that the Receivables have been assigned
to the Collateral Agent for the ratable benefit of the Secured Parties and that
payments in respect thereof shall be made directly to the Collateral Agent.
(b) Anything herein to the contrary notwithstanding, each
Grantor shall remain liable under the Receivables to observe and perform all the
conditions and obligations to be observed and performed by it thereunder, all in
accordance with the terms of any agreement giving rise thereto. Neither the
Collateral Agent nor any Secured Party shall have any obligation or liability
under any Receivable (or any agreement giving rise thereto) by reason of or
arising
out of this Agreement or the receipt by the Collateral Agent or any Secured
Party of any payment relating thereto, nor shall the Collateral Agent or any
Secured Party be obligated in any manner to perform any of the obligations of
any Grantor under or pursuant to any Receivable (or any agreement giving rise
thereto) to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any
performance by any party thereunder, to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time or
times.
SECTION 6.03. Pledged Stock. (d) Unless an Event of Default
shall have occurred and be continuing and the Collateral Agent shall have given
notice to the relevant Grantor of the Collateral Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes, in each case paid in the normal
course of business of the relevant Issuer and consistent with past practice, to
the extent permitted in the Credit Agreement and the Note Agreements, and to
exercise all voting and corporate or other organizational rights with respect to
the Investment Property.
(a) If an Event of Default shall occur and be continuing and
the Collateral Agent shall give notice of its intent to exercise such rights to
the relevant Grantor or Grantors, the Collateral Agent shall have the right to
receive any and all cash dividends, payments or other Proceeds paid in respect
of the Investment Property and make application thereof to the Obligations, as
provided in the Intercreditor Agreement, in such order as the Collateral Agent
may determine. If an Event of Default shall occur and be continuing and either
(A) the Co-Administrative Agent shall have, pursuant to the request of the
Required Lenders, by notice to the Borrower (i) terminated the Revolving Credit
Commitments and/or (ii) declared the Loans then outstanding to be due and
payable in whole, or (B) any or all of the Prudential Notes shall have become
immediately due and payable pursuant to Section 7.1 of the respective Note
Agreement, then any or all of the Investment Property shall at the request of
the Collateral Agent be registered in the name of the Collateral Agent or its
nominee, and the Collateral Agent or its nominee may thereafter exercise (x) all
voting, corporate and other rights pertaining to such Investment Property at any
meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y)
any and all rights of conversion, exchange and subscription and any other
rights, privileges or options pertaining to such Investment Property as if it
were the absolute owner thereof (including, without limitation, the right to
exchange at its discretion any and all of the Investment Property upon the
merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate or other organizational structure of any Issuer, or upon
the exercise by any Grantor or the Collateral Agent of any right, privilege or
option pertaining to such Investment Property, and in connection therewith, the
right to deposit and deliver any and all of the Investment Property with any
committee, depositary, transfer agent, registrar or other designated agency upon
such terms and conditions as the Collateral Agent may determine), all without
liability except to account for property actually received by it, but the
Collateral Agent shall have no duty to any Grantor to exercise any such right,
privilege or option and shall not be responsible for any failure to do so or
delay in so doing.
(b) Each Grantor hereby authorizes and instructs each Issuer
of any Investment Property pledged by such Grantor hereunder to (i) comply with
any instruction received by it from the Collateral Agent in writing that (x)
states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Grantor, and each Grantor agrees that each Issuer
shall be fully protected in so complying, and (ii) unless otherwise expressly
permitted hereby, pay any dividends or other payments with respect to the
Investment Property directly to the Collateral
Agent. Each Issuer which is a party hereto acknowledges the authorizations and
instructions provided for in the immediately proceeding sentence.
SECTION 6.04. Proceeds to be Turned Over To Collateral Agent.
In addition to the rights of the Collateral Agent and the Secured Parties
specified in Section 6.1 with respect to payments of Receivables, if an Event of
Default shall occur and be continuing, all Proceeds received by any Grantor
consisting of cash, checks and other near-cash items shall be held by such
Grantor in trust for the Collateral Agent and the Secured Parties, segregated
from other funds of such Grantor, and shall, forthwith upon receipt by such
Grantor, be turned over to the Collateral Agent in the exact form received by
such Grantor (duly indorsed by such Grantor to the Collateral Agent, if
required). All Proceeds received by the Collateral Agent hereunder shall be held
by the Collateral Agent in a Collateral Account maintained under its sole
dominion and control. All Proceeds while held by the Collateral Agent in a
Collateral Account (or by such Grantor in trust for the Collateral Agent and the
Lenders) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as provided
in Section 6.5.
SECTION 6.05. Application of Proceeds. The Collateral Agent
shall apply any Proceeds constituting Collateral (other than any Guarantee
Related Payment, which payments shall be applied in accordance with Section 2.9
hereof) received by the Collateral Agent pursuant to or in connection with
enforcement of this Agreement or upon the commencement of and during the
continuance of any proceedings by or against any Grantor of any type referred to
in Article VII(h) of the Credit Agreement or Section 7.1(k) of the Note
Agreements as provided in the Intercreditor Agreement (notwithstanding any other
provision herein to the contrary). Any balance of such Proceeds remaining after
the Obligations shall have been paid in full shall be paid over to the Borrower
or to whomsoever may be lawfully entitled to receive the same.
SECTION 6.06. Code and Other Remedies. If an Event of Default
shall occur and be continuing, the Collateral Agent, on behalf of the Secured
Parties, may exercise, in addition to all other rights and remedies granted to
them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured
party under the New York UCC or any other applicable law. Without limiting the
generality of the foregoing, the Collateral Agent, without demand of performance
or other demand, presentment, protest, advertisement or notice of any kind
(except any notice required by law referred to below or required by any Loan
Document) to or upon any Grantor or any other Person (all and each of which
demands, defenses, advertisements and notices are hereby waived), may in such
circumstances forthwith collect, receive, appropriate and realize upon the
Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give
option or options to purchase, or otherwise dispose of and deliver the
Collateral or any part thereof (or contract to do any of the foregoing), in one
or more parcels at public or private sale or sales, at any exchange, broker's
board or office of the Collateral Agent or any Secured Party or elsewhere upon
such terms and conditions as it may deem advisable and at such prices as it may
deem best, for cash or on credit or for future delivery without assumption of
any credit risk. The Collateral Agent or any Secured Party shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of the
Collateral so sold, free of any right or equity of redemption in any Grantor,
which right or equity is hereby waived and released. Each Grantor further
agrees, at the Collateral Agent's request, to assemble the Collateral and make
it available to the Collateral Agent at places which the Collateral Agent shall
reasonably select, whether at such Grantor's premises or elsewhere. The
Collateral Agent shall apply the net proceeds of any action taken by it pursuant
to this Section 6.6, after deducting all reasonable costs and expenses of every
kind incurred in connection therewith or incidental to the care or safekeeping
of any of the Collateral or in any
way relating to the Collateral or the rights of the Collateral Agent and the
Secured Parties hereunder, including, without limitation, reasonable attorneys'
fees and disbursements, to the payment in whole or in part of the Obligations,
in such order as the Collateral Agent may elect, and only after such application
and after the payment by the Collateral Agent of any other amount required by
any provision of law, including, without limitation, Section 9-615(a)(3) of the
New York UCC, need the Collateral Agent account for the surplus, if any, to any
Grantor. To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against the Collateral Agent or any
Secured Party arising out of the exercise by them of any rights hereunder. If
any notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given at
least 10 days before such sale or other disposition.
SECTION 6.07. Sale of Pledged Stock. Each Grantor recognizes
that the Collateral Agent may be unable to effect a public sale of any or all
the Pledged Stock, by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws or otherwise, and may be compelled to
resort to one or more private sales thereof to a restricted group of purchasers
which will be obliged to agree, among other things, to acquire such securities
for their own account for investment and not with a view to the distribution or
resale thereof. Each Grantor acknowledges and agrees that any such private sale
may result in prices and other terms less favorable than if such sale were a
public sale and, notwithstanding such circumstances, agrees that any such
private sale shall be deemed to have been made in a commercially reasonable
manner. The Collateral Agent shall be under no obligation to delay a sale of any
of the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws.
SECTION 6.08. Deficiency. Each Grantor shall remain liable for
any deficiency if the proceeds of any sale or other disposition of the
Collateral are insufficient to pay its Obligations and the fees and
disbursements of any attorneys employed by the Collateral Agent or any Secured
Party to collect such deficiency.
ARTICLE VII THE COLLATERAL AGENT
SECTION 7.01. Collateral Agent's Appointment as
Attorney-in-Fact, etc. (e) Each Grantor hereby irrevocably constitutes and
appoints the Collateral Agent and any officer or agent thereof, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, each Grantor hereby gives the Collateral Agent the power and right,
on behalf of such Grantor, without notice to or assent by such Grantor, to do
any or all of the following:
(a) in the name of such Grantor or its own name, or otherwise,
take possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under
any Receivable or with respect to any other Collateral and file any
claim or take any other action or proceeding in any court of law or
equity or otherwise deemed appropriate by the Collateral Agent for the
purpose of collecting any and all such moneys due under any Receivable
or with respect to any other Collateral whenever payable;
(b) in the case of any Intellectual Property, execute and
deliver, and have recorded, any and all agreements, instruments,
documents and papers as the Collateral Agent may request to evidence
the Collateral Agent's and the Secured Parties' security interest in
such Intellectual Property and the goodwill and general intangibles of
such Grantor relating thereto or represented thereby;
(c) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of
the premiums therefor and the costs thereof;
(d) execute, in connection with any sale provided for in
Section 6.6 or 6.7, any indorsements, assignments or other instruments
of conveyance or transfer with respect to the Collateral; and
(e) (1) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become
due thereunder directly to the Collateral Agent or as the Collateral
Agent shall direct; (2) ask or demand for, collect, and receive payment
of and receipt for, any and all moneys, claims and other amounts due or
to become due at any time in respect of or arising out of any
Collateral; (3) sign and indorse any invoices, freight or express
bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications, notices and other documents in
connection with any of the Collateral; (4) commence and prosecute any
suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect the Collateral or any portion thereof
and to enforce any other right in respect of any Collateral; (5) defend
any suit, action or proceeding brought against such Grantor with
respect to any Collateral; (6) settle, compromise or adjust any such
suit, action or proceeding and, in connection therewith, give such
discharges or releases as the Collateral Agent may deem appropriate;
(7) assign any Copyright, Patent or Trademark (along with the goodwill
of the business to which any such Copyright, Patent or Trademark
pertains), throughout the world for such term or terms, on such
conditions, and in such manner, as the Collateral Agent shall in its
sole discretion determine; and (8) generally, sell, transfer, pledge
and make any agreement with respect to or otherwise deal with any of
the Collateral as fully and completely as though the Collateral Agent
were the absolute owner thereof for all purposes, and do, at the
Collateral Agent's option and such Grantor's expense, at any time, or
from time to time, all acts and things which the Collateral Agent deems
necessary to protect, preserve or realize upon the Collateral and the
Collateral Agent's and the Secured Parties' security interests therein
and to effect the intent of this Agreement, all as fully and
effectively as such Grantor might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Collateral Agent agrees that it will not exercise any rights under the power of
attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.
(b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the Collateral Agent, at its option, but without
any obligation so to do, may perform or comply, or otherwise cause performance
or compliance, with such agreement.
(c) The expenses of the Collateral Agent incurred in
connection with actions undertaken as provided in this Section 7.1, together
with interest thereon at a rate per annum equal to the highest rate per annum at
which interest would then be payable on any category of past due ABR Loans under
the Credit Agreement, from the date of payment by the Collateral Agent to the
date reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Collateral Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.
SECTION 7.02. Duty of Collateral Agent. The Collateral Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Collateral in its possession, under Section 9-207 of the New York UCC or
otherwise, shall be to deal with it in the same manner as the Collateral Agent
deals with similar property for its own account. Neither the Collateral Agent,
any Secured Party nor any of their respective officers, directors, employees or
agents shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof. The powers conferred on the Collateral Agent and
the Secured Parties hereunder are solely to protect the Collateral Agent's and
the Secured Parties' interests in the Collateral and shall not impose any duty
upon the Collateral Agent or any Secured Party to exercise any such powers. The
Collateral Agent and the Secured Parties shall be accountable only for amounts
that they actually receive as a result of the exercise of such powers, and
neither they nor any of their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or willful misconduct.
SECTION 7.03. Execution of Financing Statements. Pursuant to
any applicable law, each Grantor authorizes the Collateral Agent to file or
record financing statements and other filing or recording documents or
instruments with respect to the Collateral without the signature of such Grantor
in such form and in such offices as the Collateral Agent determines appropriate
to perfect the security interests of the Collateral Agent under this Agreement.
Each Grantor authorizes the Collateral Agent to use the collateral description
"all personal property" in any such financing statements. Each Grantor hereby
ratifies and authorizes the filing by the Collateral Agent of any financing
statement with respect to the Collateral made prior to the date hereof.
SECTION 7.04. Authority of Collateral Agent. Each Grantor
acknowledges that the rights and responsibilities of the Collateral Agent under
this Agreement with respect to any action taken by the Collateral Agent or the
exercise or non-exercise by the Collateral Agent of any option, voting right,
request, judgment or other right or remedy provided for herein or resulting or
arising out of this Agreement shall, as between the Collateral Agent and the
Secured Parties, be governed by the Intercreditor Agreement and the Credit
Agreement and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Collateral Agent and the Grantors,
the Collateral Agent shall be conclusively presumed to be acting as agent for
the Secured Parties with full and valid authority so to act or refrain from
acting, and no Grantor shall be under any obligation, or entitlement, to make
any inquiry respecting such authority.
ARTICLE VIII MISCELLANEOUS
SECTION 8.01. Amendments in Writing. None of the terms or
provisions of this Agreement may be waived, amended, supplemented or otherwise
modified except (a) with the consent of the Required Noteholders and (b) in
accordance with Section 9.02(b) of the Credit Agreement.
SECTION 8.02. Notices. All notices, requests and demands to or
upon the Collateral Agent or any Grantor hereunder shall be effected in the
manner provided for in
Section 9.01 of the Credit Agreement, and, in the case of any Grantor, the Note
Agreements; provided that any such notice, request or demand to or upon any
Guarantor shall be addressed to such Guarantor at its notice address set forth
on Schedule 1.
SECTION 8.03. No Waiver by Course of Conduct; Cumulative
Remedies. Neither the Collateral Agent nor any Secured Party shall by any act
(except by a written instrument pursuant to Section 8.1), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default. No failure to exercise,
nor any delay in exercising, on the part of the Collateral Agent or any Secured
Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Collateral Agent or any
Secured Party of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Collateral Agent or such
Secured Party would otherwise have on any future occasion. The rights and
remedies herein provided are cumulative, may be exercised singly or concurrently
and are not exclusive of any other rights or remedies provided by law.
SECTION 8.04. Enforcement Expenses; Indemnification. (f) Each
Guarantor agrees to pay or reimburse each Secured Party and the Collateral Agent
for all its costs and expenses incurred in collecting against such Guarantor
under the guarantee contained in Section 2 or otherwise enforcing or preserving
any rights under this Agreement, the Note Agreements and the other Loan
Documents to which such Guarantor is a party, including, without limitation, the
fees and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to each Secured Party and of counsel to the Collateral Agent.
(a) Each Guarantor agrees to pay, and to save the Collateral
Agent and the Secured Parties harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all stamp, excise,
sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.
(b) Each Guarantor agrees to pay, and to save the Collateral
Agent and the Secured Parties harmless from, any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement to the extent the Borrower would be required to do so pursuant to
Section 9.03 of the Credit Agreement or pursuant to Section 11.2 of the Note
Agreements.
(c) The agreements in this Section 8.4 shall survive repayment
of the Obligations and all other amounts payable under the Credit Agreement, the
Note Agreements, the Prudential Notes and the other Loan Documents.
SECTION 8.05. Successors and Assigns. This Agreement shall be
binding upon the successors and assigns of each Grantor and shall inure to the
benefit of the Collateral Agent and the Secured Parties and their successors and
assigns; provided that no Grantor may assign, transfer or delegate any of its
rights or obligations under this Agreement without the prior written consent of
the Collateral Agent.
SECTION 8.06. Set-Off. Each Grantor hereby irrevocably
authorizes the Collateral Agent and each Secured Party at any time and from time
to time while an Event of Default shall have occurred and be continuing, without
notice to such Grantor or any other Grantor, any such notice being expressly
waived by each Grantor, to set-off and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Collateral Agent or such
Secured Party to or for the credit or the account of such Grantor, or any part
thereof in such amounts as the Collateral Agent or such Secured Party may elect,
against and on account of the obligations and liabilities of such Grantor to the
Collateral Agent or such Secured Party hereunder and claims of every nature and
description of the Collateral Agent or such Secured Party against such Grantor,
in any currency, whether arising hereunder, under the Credit Agreement, the Note
Agreements, the Prudential Notes, any other Loan Document or otherwise, as the
Collateral Agent or such Secured Party may elect, whether or not the Collateral
Agent or any Secured Party has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The
Collateral Agent and each Secured Party shall notify such Grantor promptly of
any such set-off and the application made by the Collateral Agent or such
Secured Party of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of the Collateral Agent and each Secured Party under this Section 8.6 are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Collateral Agent or such Secured Party may have.
SECTION 8.07. Counterparts. This Agreement may be executed by
one or more of the parties to this Agreement on any number of separate
counterparts (including by telecopy), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.
SECTION 8.08. Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 8.09. Section Headings. The Section headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
SECTION 8.10. Integration. This Agreement, the Credit
Agreement, the Note Agreements, the Prudential Notes, the Intercreditor
Agreement and the other Loan Documents represent the agreement of the Grantors,
the Collateral Agent and the Secured Parties with respect to the subject matter
hereof and thereof, and there are no promises, undertakings, representations or
warranties by the Collateral Agent or any Secured Party relative to subject
matter hereof and thereof not expressly set forth or referred to herein, in the
Credit Agreement, in the Note Agreements, in the Prudential Notes, in the
Intercreditor Agreement or in the other Loan Documents.
SECTION 8.11. 1.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
SECTION 8.12. Submission To Jurisdiction; Waivers. Each
Grantor hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, the Credit Agreement, the Note
Agreements, the Prudential Notes and the other Loan Documents to which it is a
party, or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Grantor at its address referred to in Section 8.2 or at such other address of
which the Collateral Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding referred
to in this Section any special, exemplary, punitive or consequential damages.
SECTION 8.13. Acknowledgements. Each Grantor hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents to which
it is a party;
(b) neither the Collateral Agent nor any Secured Party has any
fiduciary relationship with or duty to any Grantor arising out of or in
connection with this Agreement, the Credit Agreement, the Note Agreements, the
Prudential Notes or any of the other Loan Documents, and the relationship
between the Grantors, on the one hand, and the Collateral Agent and Secured
Parties, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and
(c) no joint venture is created hereby or by the Credit
Agreement, the Note Agreements, the Prudential Notes or the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Secured Parties or among the Grantors and the Secured Parties.
SECTION 8.14. Additional Grantors. Each Subsidiary of the
Borrower that is required to become a party to this Agreement pursuant to
Section 5.11 of the Credit Agreement and Section 5.6 of the Note Agreements
shall become a Grantor for all purposes of this Agreement upon execution and
delivery by such Subsidiary of an Assumption Agreement in the form of Annex 1
hereto. Merchant's, Incorporated and Merban, Inc. shall become a party to this
Agreement upon execution and delivery thereof, provided that such execution and
delivery shall only become effective upon completion of the Merchant's
Acquisition.
SECTION 8.15. Releases. (a) At such time as the Loans, the
Reimbursement Obligations, all amounts owing in respect of the Prudential Notes
and the Note Agreements and the other Obligations shall have been paid in full,
the Commitments have been terminated and no Letters of Credit shall be
outstanding, the Collateral shall be released from the Liens created hereby, and
this Agreement and all obligations (other than those expressly stated to survive
such termination) of the Collateral Agent and each Grantor hereunder shall
terminate, all without delivery of any instrument or performance of any act by
any party, and all rights to the Collateral
shall revert to the Grantors. At the request and sole expense of any Grantor
following any such termination, the Collateral Agent shall deliver to such
Grantor any Collateral held by the Collateral Agent hereunder, and execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence such termination.
(a) If any of the Collateral shall be sold, transferred or
otherwise disposed of by any Grantor in a transaction permitted by the Credit
Agreement and the Note Agreements, then the Collateral Agent, at the request and
sole expense of such Grantor, shall execute and deliver to such Grantor all
releases or other documents reasonably necessary or desirable for the release of
the Liens created hereby on such Collateral. At the request and sole expense of
the Borrower, a Guarantor shall be released from its obligations hereunder in
the event that all the Capital Stock of such Guarantor shall be sold,
transferred or otherwise disposed of in a transaction permitted by the Credit
Agreement and the Note Agreements; provided that the Borrower shall have
delivered to the Collateral Agent, at least ten Business Days prior to the date
of the proposed release, a written request for release identifying the relevant
Subsidiary Guarantor and the terms of the sale or other disposition in
reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such
transaction is in compliance with the Credit Agreement, the Note Agreements and
the other Loan Documents.
SECTION 8.16. 1.6 WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Continuation of Liens Securing Existing Prudential Notes.
In addition to constituting new Liens securing all of the
Borrower Obligations, the Liens created hereby shall be deemed to be a
continuation and confirmation of the Liens created pursuant to the Existing
Security Agreements and an amendment and restatement of the terms and conditions
thereof.
SECTION 8.17. Existing Guarantees. The Guarantees executed by
each Subsidiary under the Existing Credit Agreement shall be superceded by the
guarantee contained in Section 2 hereof.
IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee and Collateral Agreement to be duly executed and delivered as of the
date first above written.
TBC Corporation
By:
-----------------------------------
Name:
Title:
TBC International Inc.
By:
-----------------------------------
Name:
Title:
▇▇▇▇▇▇▇'▇, Inc.
By:
-----------------------------------
Name:
Title:
Big O Tires, Inc.
By:
-----------------------------------
Name:
Title:
TBC Retail Enterprises, Inc.
By:
-----------------------------------
Name:
Title:
Big O Tire of Idaho, Inc.
By:
-----------------------------------
Name:
Title:
O Advertising, Inc.
By:
-----------------------------------
Name:
Title:
Tire Kingdom, Inc.
By:
-----------------------------------
Name:
Title:
Northern States Tire, Inc.
By:
-----------------------------------
Name:
Title:
Big O Retail Enterprises, Inc.
By:
-----------------------------------
Name:
Title:
Big O Development, Inc.
By:
-----------------------------------
Name:
Title:
TBC Brands, LLC
By:
-----------------------------------
Name:
Title:
TBC Capital, LLC
By:
-----------------------------------
Name:
Title:
Merchant's Incorporated
By:
-----------------------------------
Name:
Title:
Merban, Inc.
By:
-----------------------------------
Name:
Title:
Schedule 1
NOTICE ADDRESSES OF GUARANTORS
All notices, requests or demands to or upon any Guarantor shall be addressed to
such Guarantor:
c/o TBC Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
or
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Schedule 2
DESCRIPTION OF INVESTMENT PROPERTY
PLEDGED STOCK:
ISSUER CLASS OF STOCK CERT. NO. NO. OF SHARES
------ -------------- --------- -------------
TBC International Inc. Common 2 1
▇▇▇▇▇▇▇'▇, Inc. Common 150 2,337,002
Big O Tires, Inc. Common 2 100
TBC Retail Enterprises, Inc. Common 1 100
Big O Tire of Idaho, Inc. Common R-1 6,002
O Advertising, Inc. Common R-1 31,000
Tire Kingdom, Inc. Common 7 60,000
Northern States Tire, Inc. Common 2 100
Big O Retail Enterprises, Inc. Common 2 10,000
Big O Development, Inc. Common R-1 20,000
Merchant's, Incorporated Common
Merban, Inc. Common
UNCERTIFICATED SECURITIES:
Name of Issuer Percentage of Membership Interests
-------------- ----------------------------------
TBC Brands, LLC 100% Owned by TBC Corporation
TBC Capital, LLC 90% Owned by TBC Corporation
5% Owned by ▇▇▇▇▇▇▇'▇, Inc.
5% Owned by Tire Kingdom, Inc.
SCHEDULE 3
LOCATION OF JURISDICTION AND CHIEF EXECUTIVE OFFICE
LOCATION OF CHIEF
GRANTOR JURISDICTION OF ORGANIZATION EXECUTIVE OFFICE
------- ---------------------------- ----------------
TBC CORPORATION DELAWARE ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TBC INTERNATIONAL INC. DELAWARE ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇'▇, INC. GEORGIA ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
BIG O TIRES, INC. NEVADA ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TBC RETAIL ENTERPRISES, INC. DELAWARE ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
BIG O TIRE OF IDAHO, INC. IDAHO ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
O ADVERTISING, INC. COLORADO ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TIRE KINGDOM, INC. FLORIDA ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
NORTHERN STATES TIRE, INC. DELAWARE ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
BIG O RETAIL ENTERPRISES, INC. COLORADO ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
BIG O DEVELOPMENT, INC. COLORADO ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TBC BRANDS, LLC DELAWARE SUITE 390-P
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
TBC CAPITAL, LLC ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇-▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
MERCHANT'S, INCORPORATED DELAWARE ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
MERBAN, INC. VIRGINIA ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SCHEDULE 4
TRADEMARKS, TRADENAMES, SERVICE MARKS, AND COPYRIGHTS
TIRE KINGDOM, INC.
TRADEMARK REPORT BY ▇▇▇▇ PRINTED: 3/28/2003 PAGE 1
STATUS: ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
MISCELLANEOUS [CROWN] DESIGN
UNITED STATES 9/1/1999 75/791,760 6/27/2000 2,363,324 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/5/2003 76/487,769 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/10/1992 74/338,671 5/31/1994 1,838,215 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/5/2003 76/487,604 PENDING 35
END OF TOTAL ITEMS SELECTED = 4
BIG O TIRES, INC.
TRADEMARK REPORT BY ▇▇▇▇ PRINTED: 3/28/2003 PAGE 1
STATUS: ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
A REPUTATION YOU CAN RIDE ON
UNITED STATES 2/22/1993 74/360,838 7/19/1994 1,845,544 REGISTERED 37,42
ASPEN
UNITED STATES 3/25/1988 73/718,614 10/11/1988 1,508,041 REGISTERED 12
BIG FOOT
CANADA 3/15/1988 602897 3/13/1992 395398 REGISTERED A
MEXICO 5/15/1998 332727 10/20/2000 674604 REGISTERED 12
UNITED STATES 5/7/1993 74/389,931 7/11/1995 1,904,955 REGISTERED ▇▇
▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/6/1974 73/031,264 9/12/1978 1,102,058 REGISTERED ▇▇
▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/16/1974 73/031,311 9/12/1978 1,102,059 REGISTERED 12
BIG HAUL
UNITED STATES 10/3/1974 73/033,736 8/26/1975 1,018,800 REGISTERED ▇▇
▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇/▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/17/1997 75/358,399 12/18/2001 2,520,443 REGISTERED 35,37
BIG O
MEXICO 5/15/1998 332726 10/20/2000 674603 REGISTERED 12
TEXAS 9/2/1982 N/A 9/2/1982 40704 REGISTERED 12
TEXAS 11/1/1982 40967 11/1/1982 40967 REGISTERED 42
UNITED STATES 1/14/1974 73/010,921 9/24/1974 993,415 REGISTERED 12
UNITED STATES 9/10/1973 73/000,572 10/1/1974 994,466 REGISTERED 42
BIG O TIRES
CANADA 6/18/1987 586384 10/27/1989 361490 REGISTERED N/A
CANADA 5/5/1999 1,014,484 2/21/2002 TMA558285 REGISTERED 12,35,37
MEXICO 5/15/1998 332728 10/20/2000 674605 REGISTERED 42
UNITED STATES 4/12/1999 75/679,597 12/12/2000 2,411,926 REGISTERED 12,35,37
BIG O TIRES & DESIGN
CANADA 6/12/1981 259,938 REGISTERED N/A
CANADA 3/27/1991 682687 11/12/1993 TMA419439 REGISTERED N/A
BIG O TIRES AND DESIGN
UNITED STATES 12/4/1989 74/007,344 8/28/1990 1,611,160 REGISTERED 12,42
COST U LESS & DESIGN
CANADA 8/5/1994 761237 10/28/1997 TMA484761 REGISTERED A,Aa
MEXICO 8/9/1994 207912 10/11/1994 476693 REGISTERED ▇▇,▇
▇▇▇▇▇▇ 8/9/1994 207911 10/5/1994 476099 REGISTERED ▇▇
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 7/12/1994 74/548,947 1/30/1996 1,952,457 REGISTERED 12,37,42
DARE TO COMPARE
UNITED STATES 4/20/2000 76/030,453 9/25/2001 2,492,236 REGISTERED 035
DESIGN OF BIG FOOT
CANADA 5/5/1999 1,014,482 3/15/2001 TMA542,415 REGISTERED 12,35,37
UNITED STATES 4/12/1999 75/680,850 2/1/2000 2,314,775 REGISTERED 12,35,37
EURO TOUR
CANADA 1/15/2003 1164833 PENDING 12
MEXICO 2/3/2003 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/8/2002 76/468,502 PENDING 12
EXTRA CARE & DESIGN
UNITED STATES 3/24/1986 589,583 11/18/1986 1,417,730 REGISTERED 37
UNITED STATES 3/24/1986 73/589,583 11/18/1986 1,417,730 REGISTERED 37
HYDRO-TRAC
MEXICO 1/14/1994 188025 5/4/1994 459327 REGISTERED 12
LEGACY
CANADA 3/15/1988 602896 3/13/1992 395397 REGISTERED N/A
COLORADO 10/28/1985 N/A 10/28/1985 T29645 REGISTERED 35
COLORADO 4/22/1976 T30670 REGISTERED
MEXICO 1/14/1994 188026 5/4/1994 459328 REGISTERED 12
UNITED STATES 10/31/1985 73/566,064 5/20/1986 1,393,967 REGISTERED 12
LIGHTENING
MEXICO 1/14/1994 188027 12/6/1994 481629 REGISTERED 12,35
PATHMAX
UNITED STATES 8/3/1998 75/529,550 9/28/1999 2,281,419 REGISTERED 12
PROCOMP
MEXICO 1/14/1994 188028 5/4/1994 459329 REGISTERED 12, 35
PROCOMP HIGH PERFORMANCE
UNITED STATES 7/27/1992 74/298,320 7/5/1994 1,842,854 REGISTERED 12
SASQUATCH [BIG FOOT] DESIGN
CANADA 5/5/1999 1,014,483 1/16/2003 TMA573769 REGISTERED 12,35,37
SONIC COMMERICAL
UNITED STATES 12/2/1964 72/207,339 3/15/1966 805,578 REGISTERED ▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/31/1968 72/310,988 6/17/1969 871,318 REGISTERED 35
VENGEANCE
CANADA 1/2/2003 ▇/▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇/▇/▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/18/2002 76/460,700 PENDING 12
▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇ & DESIGN
CANADA 3/20/2001 1096649 PENDING
MEXICO 3/29/2001 478565 8/30/2001 713395 REGISTERED 37
MEXICO 3/29/2001 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/1/2000 76/174,243 12/4/2001 2,514,975 REGISTERED 35, 37
END OF TOTAL ITEMS SELECTED = 63
TBC BRANDS, LLC
TRADEMARK REPORT BY ▇▇▇▇ PRINTED: 3/28/2003 PAGE 1
STATUS: ACTIVE
COUNTRY FILED APPL# REGDT REG# STATUS CLASSES
AQUA FLOW
CANADA 3/9/1993 724,287 7/15/1994 430478 REGISTERED N/A
JAPAN 8/25/1993 87543/93 7/31/1996 3183343 REGISTERED 12
MEXICO 3/24/1993 163889 8/3/1993 438707 REGISTERED 12
UNITED STATES 11/24/1992 74/334,184 1/4/1994 1,815,411 REGISTERED 12
AQUA FLOW III
CANADA 2/5/2001 1091561 ALLOWED
MEXICO 3/13/2001 475492 5/24/2001 699369 REGISTERED
UNITED STATES 9/13/2000 76/128,049 4/2/2002 2,557,298 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,568 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇ 2/19/1999 1006129 10/18/2000 TMA535,038 REGISTERED 12
MEXICO 4/23/1999 372561 2/29/2000 644642 REGISTERED 12
UNITED STATES 1/15/1999 75/621,314 3/20/2001 2,437,511 REGISTERED 12
CENTRON
UNITED STATES 3/12/1985 73/526,552 9/3/1985 1,357,941 REGISTERED 12
CENTURY
CANADA 9/10/1999 1,028,617 11/22/2002 TMA571137 REGISTERED N/A
UNITED STATES 7/30/1999 75/764,830 7/17/2001 2,470,426 REGISTERED 12
CORDOVAN
CANADA 3/8/1990 652,673 4/5/1991 382741 REGISTERED 12
CHINA 6/28/2002 3225736 PENDING 12
EUROPEAN UNION 12/30/1997 719351 4/7/1999 000719351 REGISTERED 9,12
FRANCE 4/25/1991 282653 4/25/1991 1657817 REGISTERED 9,12
GERMANY 4/30/1991 T 31 825/12 W 7/14/1992 2017105 REGISTERED 9,12
MEXICO 12/19/1997 318673 2/27/1998 571618 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 4/24/1991 1462329 4/24/1991 1462329 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 5/21/1991 1464865 5/21/1991 1464865 REGISTERED 9
UNITED STATES 9/27/1985 73/560,572 12/2/1986 1,419,104 REGISTERED ▇▇,▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/15/1945 72/159,045 8/27/1963 755,493 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 5/19/1964 72/193,756 2/9/1965 784,838 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/29/1976 73/108,055 9/19/1978 1,102,631 REGISTERED ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 8/30/1967 72/279,376 8/6/1968 854,177 REGISTERED 35
CRITERION
UNITED STATES 2/29/1980 73/252,026 9/15/1981 1,169,191 REGISTERED 12
EPIC
CANADA 6/13/2000 1,063,059 8/7/2002 TMA565594 REGISTERED N/A
MEXICO 1/4/1995 220948 3/28/1995 486515 REGISTERED 12
UNITED STATES 9/10/1985 73/559,173 4/8/1986 1,388,996 REGISTERED 12
EXCEL
CANADA 9/10/1999 1,028,616 ALLOWED ▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 7/30/1999 75/764,829 7/17/2001 2,470,425 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 5/7/1985 73/536,361 11/5/1985 1,368,849 REGISTERED 12
FRONTLINE
MEXICO 10/21/1994 216047 8/30/1995 502347 REGISTERED 12
GRAN ESPRIT
EUROPEAN UNION 9/19/1996 385617 8/28/1998 385617 REGISTERED 12
UNITED STATES 5/20/1996 75/107,105 4/14/1998 2,151,303 REGISTERED 12
GRAND AM
CANADA 12/29/1994 772,065 6/14/1996 459411 REGISTERED 12
MEXICO 10/13/1994 215380 11/22/1994 480234 REGISTERED 12
GRAND PRIX
CANADA 10/26/1993 739674 3/16/1999 TMA509,415 REGISTERED N/A
MEXICO 11/8/1993 182542 PENDING 12
MEXICO 8/30/1994 210274 11/18/1994 479812 REGISTERED 7
UNITED STATES 5/5/1980 73/260,923 12/29/1981 1,183,571 REGISTERED 11
UNITED STATES 10/26/1982 73/400,864 11/22/1983 1,258,438 REGISTERED 9
UNITED STATES 12/12/1975 73/071,592 10/25/1977 1,075,901 REGISTERED 12
UNITED STATES 8/24/1987 73/680,289 8/27/1991 1,655,035 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/1982 73/355,136 1/18/1983 1,224,147 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/25/1959 72/070,188 12/22/1959 690,249 REGISTERED 35
GRAND PRIX RADIAL G/T (STYLIZED)
UNITED STATES 5/5/1980 73/260,924 8/11/1981 1,164,594 REGISTERED 12
GRAND SPIRIT
MEXICO 7/24/1995 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 1/24/1994 74/481,579 2/27/1996 1,958,273 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,572 PENDING 12
GRAND SPORT
CANADA 4/12/1990 654,898 3/6/1992 TMA 395,089 REGISTERED 12
MEXICO 1/4/1995 220944 4/23/1997 546167 REGISTERED 12
UNITED STATES 5/13/1986 73/598,547 12/23/1986 1,421,825 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ 12/29/1994 772,070 1/19/1996 TMA452894 REGISTERED 12
CHINA 1/30/2002 3084124 ALLOWED 12
MEXICO 10/13/1994 215383 7/21/1995 497846 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/19/1989 73/807,530 5/8/1990 1,595,216 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/2000 76/004,068 4/9/2002 2,559,952 REGISTERED ▇▇
▇▇▇▇ ▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 8/10/1976 73/096,101 12/13/1977 1,079,273 REGISTERED 9
MATRIX
BRAZIL 10/25/1999 822129833 PENDING
UNITED STATES 3/13/1985 73/562,619 3/1/1988 1,478,574 REGISTERED 12
MILEAGE MASTER
UNITED STATES 3/12/2003 76/497,354 PENDING
MULTI-MILE
CANADA 2/29/2000 654903(1) 4/12/1991 TMA383056 REGISTERED 12
CHINA 6/28/2002 3225735 PENDING 12
EUROPEAN UNION 12/30/1997 719260 4/7/1999 000719260 REGISTERED 9,12
FRANCE 4/24/1991 282446 4/2/1991 1657653 REGISTERED 9,12
MEXICO 3/24/1993 163887 7/3/1993 438706 REGISTERED 12
MEXICO 10/21/1994 216045 3/22/1995 485680 REGISTERED ▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 4/23/1991 1462051 4/23/1991 B1462051 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 5/21/1991 1464866 5/21/1991 B1464866 REGISTERED 9
UNITED STATES 8/23/1982 73/381,561 11/29/1983 1,259,363 REGISTERED 12
UNITED STATES 5/15/1998 75/485,588 8/3/1999 2,266,907 REGISTERED ▇▇
▇▇▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 5/11/1950 71/597,256 6/24/1952 560,428 REGISTERED 12
MULTI-MILE RADIAL G/T (STYLIZED)
UNITED STATES 11/29/1976 73/108,056 9/18/1979 1,125,174 REGISTERED 12
MULTI-MILE WIDE '600'
UNITED STATES 8/30/1967 72/279,377 8/6/1968 854,178 REGISTERED 35
MULTI-TRAC
MEXICO 10/13/1994 215381 7/19/1995 497555 REGISTERED ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/22/1973 72/452,297 3/26/1974 981,104 REGISTERED 35
POWER KING
CANADA 4/12/1990 654,907 4/5/1991 382759 REGISTERED 12
CHINA 1/30/2002 3084106 ALLOWED 12
MEXICO 6/11/1998 336096 PENDING ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 4/5/1979 73/210,451 7/29/1980 1,138,319 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇ (▇▇▇▇▇▇▇▇)
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/7/1983 73/412,703 4/3/1984 1,272,524 REGISTERED ▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 6/21/2002 76/424,630 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/8/2002 76/468,503 ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ 5/27/1959 251153 12/11/1959 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 9/1/1954 71/672,582 6/7/1955 607,037 REGISTERED 35
REGENT
CANADA 8/3/2000 1,069,844 PENDING
MEXICO 11/21/2000 459062 8/16/2002 758958 REGISTERED 12
UNITED STATES 12/17/1999 75/874,916 6/26/2001 2,464,646 REGISTERED 12
SCEPTOR
UNITED STATES 5/13/1986 73/598,549 12/23/1986 1,421,827 REGISTERED 12
SHADOW
CANADA 8/3/2000 1,069,845 PENDING
MEXICO 9/11/2002 565576 PENDING
UNITED STATES* 12/17/1999 75/874,915 PENDING 12
* IN THE NAME OF TBC CORPORATION
SIGMA
CANADA 4/12/1990 654,894 4/5/1991 382758 REGISTERED 12
CHINA 6/28/2002 3225734 PENDING 12
GERMANY 6/10/1991 T 32 059/12 W 7/14/1992 2017108 REGISTERED 12
MEXICO 5/29/1995 N/A 7/27/1995 499136 REGISTERED 12
MEXICO 5/29/1995 N/A 7/27/1995 499136 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 6/6/1991 1466536 6/6/1991 1466536 REGISTERED 12
UNITED STATES 5/15/1998 75/485,561 7/20/1999 2,262,889 REGISTERED 12
SIGMA & DESIGN
UNITED STATES 12/28/1973 73/009,844 11/19/1974 998,427 REGISTERED 12
SIGMA SUPREME HP
CANADA 8/3/2000 1,069,847 ALLOWED
MEXICO 11/21/2000 459065 12/14/2001 728573 REGISTERED
UNITED STATES 7/26/2000 76/096,412 6/4/2002 2,575,403 REGISTERED 12
SIGMA SUPREME TR
CANADA 8/3/2000 1,069,848 ALLOWED
MEXICO 11/21/2000 459064 12/14/2001 728572 REGISTERED 12
UNITED STATES 12/17/1999 75/874,912 3/26/2002 2,553,584 REGISTERED 12
SOVRAN
UNITED STATES 7/27/1989 73/815,288 6/12/1990 1,600,677 REGISTERED 12
STAMPEDE
CANADA 12/29/1994 772,066 11/3/1995 TMA449689 REGISTERED 12
MEXICO 1/4/1995 220945 3/28/1995 486513 REGISTERED 12
UNITED STATES 9/18/1984 73/499,961 5/28/1985 1,337,798 REGISTERED 12
SUSSEX
UNITED STATES 5/13/1986 73/598,548 12/23/1986 1,421,826 REGISTERED 12
TALON
CANADA 12/29/1994 772,067 11/3/1995 TMA449690 REGISTERED 12
MEXICO 1/4/1995 220943 3/28/1995 486512 REGISTERED 12
UNITED STATES 9/10/1985 73/559,172 4/8/1986 1,388,995 REGISTERED 12
TBC
MEXICO 8/6/1999 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 10/26/1983 73/449,847 7/2/1985 1,345,491 REGISTERED 9,12
UNITED STATES 6/13/1978 73/174,209 2/20/1979 1,113,549 REGISTERED 12
UNITED STATES 6/8/1995 74/685,983 11/25/1997 2,114,992 REGISTERED ▇▇,▇▇,▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/12/2002 76/369,496 ALLOWED 9,12,16
TBC ONLINE
CANADA 4/16/1998 875566 6/29/2000 TMA529893 REGISTERED 9
MEXICO 12/16/1998 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 1/23/1998 75/423,437 1/25/2000 2,312,424 REGISTERED ▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 2/12/2002 76/369,492 ALLOWED 35
TEMPEST
CANADA 8/3/2000 1,069,846 ALLOWED
MEXICO 11/21/2000 459063 12/14/2001 728571 REGISTERED 12
UNITED STATES 12/17/1999 75/874,914 6/19/2001 2,462,822 REGISTERED 12
TODAY
UNITED STATES 2/25/1994 74/494,330 1/21/1997 2,032,519 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/17/2000 76/004,067 4/2/2002 2,557,059 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇/▇▇/▇▇▇▇ ▇/▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,525 PENDING 12
TRAIL SCOUT
MEXICO 7/30/1999 385267 9/22/1999 624142 REGISTERED 12
UNITED STATES 4/12/1999 75/679,588 7/3/2001 2,466,356 REGISTERED ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/12/2003 76/497,369 PENDING
TURBO-TECH
UNITED STATES 7/18/1989 73/813,331 10/2/1990 1,615,599 REGISTERED ▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 11/1/1984 73/506,662 6/11/1985 1,340,421 REGISTERED 9
ULTRA LIFE
UNITED STATES 11/5/1984 73/507,226 11/19/1985 1,371,051 REGISTERED 9
ULTREX
UNITED STATES 3/16/1994 74/500,719 4/16/1996 1,968,838 REGISTERED 12
VANDERBILT
UNITED STATES 10/6/1961 72/129,434 6/11/1963 750,869 REGISTERED 12
VANDERBILT TOURING
UNITED STATES 12/4/2002 76/472,570 PENDING 12
WILD COUNTRY
CANADA 12/29/1994 772,071 1/19/1996 TMA452895 REGISTERED 12
MEXICO 1/4/1995 220947 3/28/1995 486514 REGISTERED 12
UNITED STATES 6/30/1992 74/289,945 3/2/1993 1,755,187 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/1/1992 74/335,812 2/15/1994 1,822,004 REGISTERED ▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ 12/4/2002 76/472,571 PENDING 12
WILD TRAC
CANADA 12/29/1994 772,069 5/9/1997 TMA475995 REGISTERED 12
MEXICO 1/4/1995 220937 3/28/1995 486510 REGISTERED 12
UNITED STATES 7/3/1978 73/177,148 7/17/1979 1,122,304 REGISTERED 12
END OF TOTAL ITEMS SELECTED = 168
MERCHANT'S, INCORPORATED AND MERBAN, INC.
(after Closing Date of Merchant's Acquisition)
REGISTRATION NO. REGISTRATION DATE
---------------- -----------------
Team Merchant's Performance
Specialists
UNITED STATES 2,248,803 09/17/2000
29 Minutes or Less, Tire Express
UNITED STATES 2,077,075 07/18/1997
No One Cares for Your Car
Like Merchant's
UNITED STATES 2,389,988 09/26/2000
Ready to Roll Tire Pricing
UNITED STATES 75/564,275 SUBJECT TO PENDING OPPOSITION FILING
Merchant's Maintenance Alert
UNITED STATES 2,078,719 07/15/1997
Merchant's Tire & Auto Center
UNITED STATES 1,420,446 11/14/87
11/30/92
04/05/93
Service That You Trust -
Guaranteed
UNITED STATES 1,743,581 12/29/1992
Merchant's
UNITED STATES 1,907,199 07/28/1995