================================================================================
$500,000,000
BRIDGE CREDIT AGREEMENT
dated as of
September 9, 1997
among
▇▇▇▇▇-▇▇▇▇▇ HOLDCO, INC.,
as Borrower
and
The Lenders Party Hereto
BANKERS TRUST COMPANY,
as Administrative Agent
and
THE CHASE MANHATTAN BANK,
as Syndication Agent
---------------------------
CHASE SECURITIES INC. and BT SECURITIES CORPORATION,
as Arrangers
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.1. Defined Terms................................................. 1
SECTION 1.2. Classification of Loans.......................................15
SECTION 1.3. Terms Generally...............................................15
SECTION 1.4. Accounting Terms; GAAP........................................16
SECTION 1.5. Change of Names...............................................16
ARTICLE II
The Loans
SECTION 2.1. Loans.........................................................16
SECTION 2.2. Loan Request..................................................17
SECTION 2.3. Funding of Loans..............................................17
SECTION 2.4. Interest Elections............................................17
SECTION 2.5. Repayment of Loans; Evidence of Debt..........................18
SECTION 2.6. Prepayment of Loans...........................................19
SECTION 2.7. Fees..........................................................20
SECTION 2.8. Interest......................................................20
SECTION 2.9. Alternate Rate of Interest....................................21
SECTION 2.10. Increased Costs...............................................21
SECTION 2.11. Break Funding Payments........................................22
SECTION 2.12. Taxes.........................................................23
SECTION 2.13. Payments Generally; Pro Rata Treatment;
Sharing of Set-offs...........................................24
SECTION 2.14. Mitigation Obligations; Replacement
of Lenders....................................................26
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Page
ARTICLE III
Representations and Warranties
SECTION 3.1. Organization; Powers..........................................27
SECTION 3.2. Authorization; Enforceability.................................27
SECTION 3.3. Governmental Approvals; No Conflicts..........................27
SECTION 3.4. Financial Condition; No Material
Adverse Change................................................27
SECTION 3.5. Properties....................................................28
SECTION 3.6. Litigation and Environmental Matters..........................28
SECTION 3.7. Compliance with Laws and Agreements...........................28
SECTION 3.8. Investment and Holding Company Status.........................29
SECTION 3.9. Taxes.........................................................29
SECTION 3.10. ERISA.........................................................29
SECTION 3.11. Disclosure....................................................29
SECTION 3.12. Solvency......................................................29
SECTION 3.13. Use of Proceeds; Margin Regulations...........................29
SECTION 3.14. No Default....................................................30
SECTION 3.15. Subsidiaries..................................................30
ARTICLE IV
Conditions
SECTION 4.1. Closing Date..................................................30
ARTICLE V
Affirmative Covenants
SECTION 5.1. Financial Statements and Other Information....................31
SECTION 5.2. Notices of Material Events....................................33
SECTION 5.3. Existence; Conduct of Business................................33
SECTION 5.4. Payment of Obligations........................................33
SECTION 5.5. Maintenance of Properties; Insurance..........................34
SECTION 5.6. Books and Records; Inspection Rights..........................34
SECTION 5.7. Compliance with Laws..........................................34
SECTION 5.8. Use of Proceeds...............................................34
SECTION 5.9. Subsidiary Guaranties.........................................34
SECTION 5.10. Syndication...................................................34
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Page
ARTICLE VI
Negative Covenants
SECTION 6.1. Material Subsidiary Debt......................................35
SECTION 6.2. Liens.........................................................36
SECTION 6.3. Modifications of Merger Document..............................37
SECTION 6.4. Fundamental Changes...........................................37
SECTION 6.5. Investments, Loans, Advances, Suretyship
Liabilities and Acquisitions..................................37
SECTION 6.6. Hedging Agreements............................................38
SECTION 6.7. Restricted Payments...........................................38
SECTION 6.8. Transactions with Affiliates..................................39
SECTION 6.9. Restrictive Agreements........................................39
SECTION 6.10. Financial Covenants...........................................39
SECTION 6.11. Unconditional Purchase Obligations............................40
SECTION 6.12. Sale of Assets; Sale and Leaseback Transaction................40
SECTION 6.13. Fiscal Year; Fiscal Quarter...................................42
ARTICLE VII
Events of Default
ARTICLE VIII
The Administrative Agent
SECTION 8.1. Appointment...................................................44
SECTION 8.2. Delegation of Duties..........................................45
SECTION 8.3. Exculpatory Provisions........................................45
SECTION 8.4. Reliance by Administrative Agent..............................45
SECTION 8.5. Notice of Default.............................................45
SECTION 8.6. Non-Reliance on Administrative Agent and Other Lenders........46
SECTION 8.7. Indemnification ..............................................46
SECTION 8.8. Administrative Agent in Its Individual Capacity ..............47
SECTION 8.9. Successor Administrative Agent................................47
SECTION 8.10. Syndication Agent.............................................47
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Page
ARTICLE IX
Miscellaneous
SECTION 9.1. Notices.......................................................48
SECTION 9.2. Waivers; Amendments...........................................49
SECTION 9.3. Expenses; Indemnity; Damage Waiver............................50
SECTION 9.4. Successors and Assigns........................................51
SECTION 9.5. Survival......................................................53
SECTION 9.6. Counterparts; Integration; Effectiveness......................53
SECTION 9.7. Severability..................................................54
SECTION 9.8. Right of Setoff...............................................54
SECTION 9.9. Governing Law; Jurisdiction; Consent
to Service of Process.........................................54
SECTION 9.10. WAIVER OF JURY TRIAL..........................................55
SECTION 9.11. Headings......................................................55
SECTION 9.12. Confidentiality...............................................55
SECTION 9.13. OREGON LEGAL NOTICE...........................................56
SCHEDULES AND EXHIBITS
Schedule 2.1 Lenders and Commitments
Schedule 3.6 Disclosed Matters
Schedule 3.15 Subsidiaries
Schedule 4.1 Refinancing of Existing Debt
Schedule 6.1 Debt
Schedule 6.2 Liens
Schedule 6.10 Restrictive Agreements
Exhibit A Assignment and Acceptance
Exhibit B Note
Exhibit C Opinion of Stoel Rives, Counsel to the Borrower
Exhibit D Subsidiary Guaranty
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BRIDGE CREDIT AGREEMENT dated as of September 9, 1997, among
▇▇▇▇▇-▇▇▇▇▇ HOLDCO., INC., as Borrower, the LENDERS party hereto, BANKERS TRUST
COMPANY, as Administrative Agent and THE CHASE MANHATTAN BANK, as Syndication
Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.1 Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR" means, for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in
effect on such day and (b) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1%. For purposes hereof, "Prime Rate" means the rate of interest
per annum publicly announced from time to time by the Administrative Agent as
its prime rate in effect at its principal office in New York City (the Prime
Rate not being intended to be the lowest rate of interest charged by the
Administrative Agent in connection with extensions of credit to debtors); each
change in the Prime Rate shall be effective on the date such change is publicly
announced as effective. "Federal Funds Effective Rate" means, for any day, the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers, as
published 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 which is a Business Day,
the average of the quotations for the day of such transactions received by the
Administrative Agent from three Federal funds brokers of recognized national
standing selected by it. If for any reason the Administrative Agent shall have
determined that it is unable to ascertain the Federal Funds Effective Rate for
any reason, including the inability or failure of the Administrative Agent to
obtain sufficient quotations in accordance with the terms thereof, the ABR shall
be determined without regard to clause (b) of the first sentence of this
definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the ABR due to a change in the Prime
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.
"Adjusted Interest Coverage Ratio" means the ratio of (a) Consolidated
EBITDAR to (b) the sum of (i) the Borrower's Consolidated Interest Expense for
such period plus (ii) except as included in Consolidated Interest Expense, the
Borrower's consolidated rental expense on operating leases, computed as of the
last day of a fiscal quarter for the period consisting of such fiscal quarter
and the immediately preceding three fiscal quarters.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Loan 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 Bankers Trust Company, in its capacity as
administrative agent for the Lenders hereunder.
"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.
"Agents" means the Administrative Agent and the Syndication Agent.
"Applicable Level" means the level determined with reference to the
following chart:
Level Ratio Rating
----- ----- ------
I greater than or equal to 7.5x greater than or equal to A-/A3
II greater than 6.5x BBB+/Baa1
III greater than 5.5x BBB/Baa2
IV greater than 4.5x BBB-/Baa3
V greater than or equal to 3.5x BB+/Ba1
VI lesser than 3.5x lesser than BB+/Ba1
For purposes of the foregoing, (i) for the six month period following from and
after the Closing Date, the Applicable Level shall be Level IV; (ii) on the date
that is six months after the Closing Date, the Borrower shall provide the
Administrative Agent with a Compliance Certificate showing the ratio of
Applicable EBITDA to Applicable Interest Expense of the Borrower for the fiscal
quarter ended January 31, 1998 (and in the event the Borrower fails timely to
provide such Compliance Certificate, the Applicable Level shall be Level V until
such Compliance Certificate is provided), and from such date until May 23, 1998,
the Applicable Level shall be the Level corresponding to such ratio; (iii)
except as provided in (i) and (ii) above, at any time of determination, the
Applicable Level shall be the Level corresponding to the ratio of Applicable
EBITDA to Applicable Interest Expense (for the most recent four consecutive
fiscal quarters; provided that for the periods ended May 23, 1998 and August 15,
1998, Applicable EBITDA and Applicable Interest Expense shall be calculated by
reference to the full fiscal quarters then ended since the Closing Date) as set
forth in the most recently delivered Compliance Certificate (it being understood
and agreed that if the Borrower shall not have delivered the most recently due
Compliance Certificate within the time period specified in Section 5.1(c), the
Applicable Level shall be Level V until such Compliance Certificate is
delivered) (for purposes of this definition, the "Ratio") and the senior
unsecured long term debt rating of the Borrower from S&P and ▇▇▇▇▇'▇ (for
2
purposes of this definition, the "Rating"); (iv) in the event the Ratio and the
Rating do not fall within the same Level, the Applicable Level shall be the
higher (Level I being the highest) of the two Levels; and (v) in the event the
rating from S&P and the rating from ▇▇▇▇▇'▇ do not fall within the same Level,
the applicable Rating will be based upon the higher (Level I being the highest)
of the two ratings, except that, in the event one of the two ratings is two or
more Levels higher than the other, the applicable Rating shall be determined by
reference to the Level next lower than the higher of the two ratings. If any
rating established or deemed to be established by ▇▇▇▇▇'▇ or S&P shall be
changed (other than as a result of a change in the rating system of ▇▇▇▇▇'▇ or
S&P), such change shall be effective as of the date on which such change is
first announced by the rating agency making such change. Each such change shall
take effect on the effective date of such change and shall end on the date
immediately preceding the effective date of the next such change. If the rating
system of S&P or ▇▇▇▇▇'▇ shall change prior to the Maturity Date, the Borrower
and the Lenders shall negotiate in good faith to amend the references to
specific ratings in this definition to reflect such changed rating system, and
pending agreement on another Applicable Level the Rating shall be determined by
reference to the rating provided by the non-changing rating agency. If the
Borrower does not have a senior long term unsecured debt rating or implied
rating from either ▇▇▇▇▇'▇ or S&P, the Applicable Level shall be determined by
reference to the Ratio only. For purposes of this definition, "Applicable
EBITDA" of the Borrower and its Subsidiaries means "A" minus "B"; where:
"A" equals the sum of consolidated net income plus, to the extent deducted
in determining consolidated pre-tax net income (i) extraordinary
losses, (ii) interest expenses, (iii) amortization, (iv) depreciation,
(v) income taxes, (vi) non-cash LIFO reserve charges; and
"B" equals, to the extent included in determining consolidated pre-tax
income, extraordinary gains;
and "Applicable Interest Expense" means the consolidated interest expense of the
Borrower and its Subsidiaries.
"Applicable Margin" means, with respect to any Eurodollar Loan, the
applicable number of basis points per annum as set forth below based on the
Applicable Level:
Applicable Margin for
Applicable Level Eurodollar Loans
---------------- ----------------
I 20.0
II 22.5
III 25.0
IV 30.0
V 37.5
3
VI 50.0
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total outstanding Loans represented by such Lender's Loan.
"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 9.4), and accepted by the Administrative Agent, in the form
of Exhibit A.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" means ▇▇▇▇▇-▇▇▇▇▇ Holdco, Inc., a Delaware corporation.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the New York interbank market.
"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 33 1/3% of the aggregate ordinary voting power
represented by the issued and outstanding capital stock of the Borrower; or (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.
"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.
4
"Closing Date" means September 9, 1997.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Compliance Certificate" means a certificate signed by a Responsible
Officer of the Borrower certifying as to the matters set forth in Section
5.1(c).
"Consolidated EBITDA" of the Borrower and its Subsidiaries means "A"
minus "B"; where:
"A" equals the sum of consolidated net income plus, to the extent deducted
in determining consolidated pre-tax net income (i) extraordinary
losses, (ii) interest expenses, including the interest component of
rent expense under all Synthetic Lease Facilities for which the
Borrower or any of its Subsidiaries has Suretyship Liability, (iii)
amortization, (iv) depreciation, (v) income taxes, (vi) non-cash LIFO
reserve charges; and
"B" equals, to the extent included in determining consolidated pre-tax
income, extraordinary gains.
"Consolidated EBITDAR" of the Borrower and its Subsidiaries means "A"
minus "B"; where:
"A" equals the sum of consolidated net income plus, to the extent deducted
in determining consolidated pre-tax net income (i) extraordinary
losses, (ii) interest expense, (iii) amortization, (iv) depreciation,
(v) income taxes, (vi) non-cash LIFO reserve charges and (vii)
consolidated rental expense on operating leases (including rent paid
pursuant to any Synthetic Lease Facility); and
"B" equals, to the extent included in determining consolidated pre-tax
income, extraordinary gains.
"Consolidated Interest Expense" means the consolidated interest
expense of the Borrower, including the interest component of rent expense under
all Synthetic Lease Facilities for which the Borrower or any of its Subsidiaries
has Suretyship Liability.
"Consolidated Total Assets" means the total consolidated assets of the
Borrower and its Subsidiaries as shown on the most recent consolidated balance
sheet of the Borrower and its Subsidiaries referred to in Section 3.4 or
delivered to the Administrative Agent and each Lender pursuant to Section 5.1.
5
"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.
"Current Synthetic Lease Facility" means the transactions contemplated
by the Participation Agreement, dated the date hereof, among FMI, the Borrower,
Wilmington Trust Company, owner trustee, FMS Trust 1997-1, as lessor, the
investors named therein, the Administrative Agent, the Syndication Agent, and
the lenders named therein.
"Debt" of any Person means, without duplication, (a) all obligations
of such Person for borrowed money, whether or not evidenced by bonds,
debentures, notes or similar instruments, (b) all Capital Lease Obligations of
such Person, (c) all obligations of such Person to pay the deferred purchase
price of property or services (other than current accounts payable in the
ordinary course of business), (d) all indebtedness secured by a Lien on the
property of such Person, whether or not such indebtedness shall have been
assumed by such Person (it being understood that if such Person has not assumed
or otherwise become personally liable for any such indebtedness, the amount of
the Debt of such Person in connection therewith shall be limited to the lesser
of the face amount of such indebtedness or the fair market value of all property
of such Person securing such indebtedness), (e) all obligations, contingent or
otherwise, with respect to the face amount of all letters of credit (whether or
not drawn) and banker's acceptances issued for the account of such Person, (f)
all obligations of such Person in respect of Hedging Agreements, (g) all
Suretyship Liabilities of such Person, (h) all other obligations of such Person
upon which interest charges are customarily paid (other than current accounts
payable in the ordinary course of business), (i) all obligations of such Person
under conditional sale or other title retention agreements relating to property
acquired by such Person and (j) all Debt (as defined above) of any partnership
in which such Person is a general partner. The amount of the Debt of any Person
in respect of Hedging Agreements shall be deemed to be the unrealized net loss
position of such Person thereunder (determined for each counterparty
individually, but netted for all Hedging Agreements maintained with such
counterparty).
"Debt for Borrowed Money" of any Person means all Debt of such Person
described in (without duplication) clauses (a), (b), (c), (d), (h) and, to the
extent constituting a Suretyship Liability in respect of Debt for Borrowed Money
of another Person, (g), of the definition of Debt. A Suretyship Liability
arising under a Synthetic Lease Facility shall be deemed to be a Debt for
Borrowed Money.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.6.
6
"dollars" or "$" refers to lawful money of the United States of
America.
"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 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.
7
"Eurodollar", when used in reference to any Loan refers to whether
such Loan is 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 Taxes" means, with respect to the Administrative Agent, any
Lender 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).
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"FMI" means ▇▇▇▇ ▇▇▇▇▇, Inc. and its successors and assigns.
"Foreign Lender" has the meaning provided in Section 2.16(e).
"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.
"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.
8
"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.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Interest Election Request" means a request by the Borrower to convert
or continue a Loan in accordance with Section 2.7.
"Interest Payment Date" means (a) with respect to ABR Loans, the last
day of each March, June, September and December and (b) with respect to
Eurodollar Loans, the last day of the Interest Period applicable to such Loans
and, in the case of Eurodollar Loans 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 Eurodollar Loans, 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, in the case of a Eurodollar
Borrowing only, 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 pertaining to Eurodollar
Loans 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.
"Lenders" means the Persons listed on Schedule 2.1 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.
"LIBO Rate" means, with respect to Eurodollar Loans for any Interest
Period, the offered quotation to first-class banks in the New York interbank
eurodollar market by the Administrative Agent for dollar deposits of amounts in
immediately available funds comparable to the outstanding principal amount of
such Eurodollar Loans, with maturities comparable to the Interest Period
applicable to such Eurodollar Loans commencing 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
9
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" and "Loans" have the meaning provided in Section 2.1.
"Loan Amount" means, with respect to each Lender, the amount set forth
opposite such Lender's name in Schedule 2.1.
"Loan Request" means the request for Loans delivered by the Borrower
pursuant to Section 2.2.
"Margin Stock" shall have the meaning provided such term in Regulation
U and Regulation G of the Federal Reserve Board.
"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, (b) the ability of the
Borrower to perform any of its obligations under this Agreement or (c) the
rights of or benefits available to the Lenders under this Agreement.
"Material Debt" means Debt of any one or more of the Borrower and its
Subsidiaries in an aggregate principal amount equal to or exceeding $5,000,000.
"Material Subsidiary" means a Subsidiary which either (a) has assets
which constitute 5% or more of the consolidated assets of the Borrower and its
Subsidiaries or (b) has revenues as of the end of the Borrower's most
recently-ended fiscal year which constitute more than 5% of the consolidated
revenues of the Borrower and its Subsidiaries during the Borrower's most
recently ended fiscal year.
"Maturity Date" means the earlier of (a) September __, 2002 and (b)
the date on which the Loan is repaid in full pursuant to Section 2.6 and/or
Section 6.12.
"Merger" means the merger of FMI and ▇▇▇▇▇'▇ as contemplated by the
Merger Document.
"Merger Document" means that certain Agreement and Plan of
Reorganization and Merger, dated as of May 11, 1997, by and between FMI and
▇▇▇▇▇'▇.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
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"Other Corporate Loan Documents" means the following documents, as
such documents are amended, supplemented or otherwise modified from time to
time: (i) all of the documents contemplated to be executed in connection with
the Current Synthetic Lease Facility; (ii) the $1,030,000,000 Credit Agreement,
of even date herewith, among ▇▇▇▇▇-▇▇▇▇▇ Holdco, Inc. as Borrower, the Lenders
identified therein, Bankers Trust Company as Administrative Agent and The Chase
Manhattan Bank as Syndication Agent; and (iii) the $500,000,000 364-Day Credit
Agreement, of even date herewith, among ▇▇▇▇▇-▇▇▇▇▇ Holdco, Inc. as Borrower,
the Lenders identified therein, Bankers Trust Company as Administrative Agent
and The Chase Manhattan Bank as Syndication Agent.
"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.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes that are not yet due or are
being contested in compliance with Section 5.4;
(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 5.4;
(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; and
(e) 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;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Debt for Borrowed Money.
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"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 two
highest credit ratings 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 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.
"Public Debt Offering" means any public offering pursuant to a
registration with the Securities and Exchange Commission or any offering
pursuant to Rule 144A promulgated under the Securities Act of 1933 for the sale
of debt instruments (whether senior or subordinated, secured or unsecured,
convertible or not) of the Borrower or any of its Subsidiaries entered into by
the Borrower or any of its Subsidiaries for the purposes of raising cash, or any
other similar transaction which the Borrower and the Administrative Agent shall
deem to be a "Public Debt Offering."
"Register" has the meaning set forth in Section 9.4.
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"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 the sum of whose
outstanding Loans at such time represents an amount greater than 50% of the
aggregate outstanding Loans of all Lenders.
"Responsible Officer" means the Chairman or Vice Chairman of the Board
of Directors, the Chairman or Vice Chairman of the Executive Committee of the
Board of Directors, the President, any Senior Vice President or Executive Vice
President, the Chief Financial Officer, the Chief Operating Officers, the Chief
Accounting Officer, the Vice President/Treasurer or any Assistant Treasurer
responsible for compliance with this Agreement.
"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.
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Food and Drug Centers Inc. and its successors
and assigns.
"Solvent" as to any Person means (i) the sum of the assets of such
Person, both at a fair valuation and at present fair salable value, will exceed
its liabilities, including contingent liabilities, (ii) such Person will have
sufficient capital with which to conduct its business as presently conducted and
(iii) such Person has not incurred debts, and does not intend to incur debts,
beyond its ability to pay such debts as they mature. For purposes of this
definition, "debt" means any liability on a claim, and "claim" means (x) a right
to payment, whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured, or (y) a right to an equitable remedy
for breach of performance if such breach gives rise to a payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured, or unsecured. With respect to
any contingent liabilities, such liabilities shall be computed at the amount
which, in light of all the facts and circumstances existing at the time,
represents the amount which can reasonably be expected to become an actual or
matured liability.
"S&P" means Standard & Poor's Corporation.
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"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 are required to 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,
with respect to any Person, any Person of which such Person and/or its
subsidiaries own, directly or indirectly, such number of outstanding shares (or
similar equity interest) as have more than 50% of the ordinary voting power for
the election of directors.
"Subsidiary" means any subsidiary of the Borrower.
"Subsidiary Guaranty" shall have the meaning set forth in Section
4.1(h).
"Surety Instruments" means all letters of credit (including standby
and commercial), banker's acceptances, guaranties, shipside bonds, surety bonds
and similar instruments under which Suretyship Liabilities arise.
"Suretyship Liability" means any agreement, undertaking or other
contractual arrangement by which any Person guarantees, endorses or otherwise
becomes or is contingently liable upon (by direct or indirect agreement,
contingent or otherwise, to provide funds for payment, to supply funds to or
otherwise to invest in a debtor, or otherwise to assure a creditor against loss)
any indebtedness, obligation or other liability (including accounts payable) of
any other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the shares of any other Person. Suretyship Liability shall include any liability
or contingent liability of a Person under or in connection with a Synthetic
Lease Facility. The amount of any Person's obligation under any Suretyship
Liability shall (subject to any limitation set forth therein) be deemed to be
the principal amount of the indebtedness, obligation or other liability
guaranteed thereby. As of any date, the amount of any Person's obligations under
any Synthetic Lease Facility shall be equal to the amount which such Person
would be obligated to pay if such Synthetic Lease Facility was accelerated on
such date (disregarding
14
accrued scheduled lease payments which would be characterized as interest if
such Synthetic Lease Facility were treated as a capital lease under GAAP).
"Syndication Agent" means The Chase Manhattan Bank.
"Synthetic Lease" and "Synthetic Lease Facility" means any synthetic
lease, tax ownership operating lease, tax retention operating lease, off balance
sheet lease or similar lease transaction where the lessee is treated as owner of
the leased property for U.S. federal income tax purposes while the lease is
accounted for on the financial statements of the lessee, prepared in accordance
with GAAP, as an operating lease, including the Current Synthetic Lease
Facility.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans and the use of the proceeds
thereof.
"Type", when used in reference to any Loan, refers to whether the rate
of interest on such Loan is determined by reference to the Adjusted LIBO Rate or
the ABR.
"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 1.2 Classification of Loans. For purposes of this Agreement,
Loans may be classified and referred to by Type (e.g., a "Eurodollar Loan").
Section 1.3 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, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits 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
15
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.
Section 1.4 Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided that
for purposes of determining compliance with any covenant set forth in Article
VI, such terms shall be construed in accordance with GAAP as in effect on the
date of this Agreement applied on a basis consistent with the application used
in preparing the Borrower's audited financial statements referred to in Section
5.1. If any change in accounting principles from those used in the preparation
of the audited financial statements referred to in Section 5.1 hereafter
occasioned by the promulgation of any rule, regulation, pronouncement or opinion
by or required by the Financial Accounting Standards Board of the American
Institute of Certified Public Accountants (or successors thereto or agencies
with similar functions) would result in a change in the method of calculation of
financial covenants, standards or terms found in Article 1 or Article VI, the
parties hereto agree to enter into negotiations in order to amend such
provisions so as to equitably reflect such changes with the desired result that
the criteria for evaluating the Borrower's financial condition shall be the same
after such change as if such change had not been made.
Section 1.5 Change of Names. It is understood and agreed that
following the consummation of the Merger, ▇▇▇▇▇-▇▇▇▇▇ Holdco, Inc. will change
its corporate name to "▇▇▇▇ ▇▇▇▇▇, Inc." and FMI will change its corporate name
to "▇▇▇▇ ▇▇▇▇▇ Stores, Inc." From and after the time at which such changes take
effect all references to "▇▇▇▇▇-▇▇▇▇▇ Holdco, Inc." or the "Borrower" contained
herein shall be construed to refer to "▇▇▇▇ ▇▇▇▇▇, Inc.," and all references to
"FMI" shall be construed to refer to "▇▇▇▇ ▇▇▇▇▇ Stores, Inc."
ARTICLE II
The Loans
Section 2.1 Loans. (a) Subject to the terms and conditions set forth
herein, each Lender hereby agrees to make a loan to the Borrower on the Closing
Date (each a "Loan" and collectively the "Loans") in an amount equal to such
Lender's Loan Amount. The Borrower may make no further borrowings after the
Closing Date, regardless of any prepayments made pursuant to Section 2.6 or
otherwise.
(b) Subject to Section 2.8, the Loans shall be comprised entirely
of either ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make its 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.
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(c) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to elect to convert or continue any Loan if the
Interest Period requested with respect thereto would end after the Maturity
Date.
Section 2.2 Loan Request. To request the Loans, the Borrower shall
notify the Administrative Agent of such request by telephone (a) if the Loans
are to be Eurodollar Loans, not later than 12:00 p.m. (noon), New York City
time, three Business Days before the Closing Date or (b) if the Loans are to be
ABR Loans, not later than 12:00 p.m. (noon), New York City time, on the Closing
Date. The Loan Request shall be irrevocable and shall be confirmed promptly by
hand delivery or telecopy to the Administrative Agent of the written Loan
Request in a form approved by the Administrative Agent and signed by the
Borrower. The telephonic and written Loan Request shall specify the following
information:
(i) whether the Loans are to be ABR Loans or Eurodollar
Loans;
(ii) in the case of Eurodollar Loans, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; and
(iii) the location and number of the Borrower's account to
which funds are to be disbursed.
If no election as to the Type of Loan is specified, then the Loans shall be ABR
Loans. If no Interest Period is specified with respect to Eurodollar Loans, then
the Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of the Loan Request in accordance with this
Section, the Administrative Agent shall advise each Lender of the details
thereof.
Section 2.3 Funding of Loans. Each Lender shall make its Loan
hereunder on the proposed date thereof by wire transfer of immediately available
funds by 2:00 p.m., New York City time, to the account of the Administrative
Agent designated by it for such purpose by notice to the Lenders. The
Administrative Agent will make such Loans 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 New York City and designated by the
Borrower in the Loan Request.
Section 2.4 Interest Elections. (a) The Loans initially shall be of
the Type specified in the Loan Request and, in the case of Eurodollar Loans,
shall have an initial Interest Period as specified in the Loan Request.
Thereafter and until the Maturity Date, the Borrower may elect to convert the
Loans to a different Type or to continue the Loans and, in the case of
Eurodollar Loans, may elect Interest Periods therefor, all as provided in this
Section; provided that no Interest Period for any Loan may end on a date that is
later than the Maturity Date in effect at the time of such election.
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(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 the Loan Request would be required under Section 2.3 if the Borrower were
requesting a Loan 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 in compliance with Section 2.2:
(i) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(ii) whether the Loans are to be ABR Loans or Eurodollar
Loans; and
(iii) if the Loans are to be Eurodollar Loans, 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 conversion to Eurodollar Loans
but does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration.
(c) Promptly following receipt of an Interest Election Request,
the Administrative Agent shall advise each Lender of the details thereof.
(d) If the Borrower fails to deliver a timely Interest Election
Request with respect to Eurodollar Loans prior to the end of the Interest Period
applicable thereto, then, unless such Loans are repaid as provided herein, at
the end of such Interest Period the Loans shall be converted to ABR Loans.
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 Loan may be converted to or continued as a
Eurodollar Loan and (ii) unless repaid, each Eurodollar Loan shall be converted
to an ABR Loan at the end of the Interest Period applicable thereto.
Section 2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender thereof the then unpaid principal amount of each Loan on
the Maturity Date.
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(b) 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.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of the Loans made hereunder, the Type thereof and
the Interest Period 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.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) 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.
(e) Any Lender may request that the Loan made by it be evidenced
by a promissory note. 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 the form of Exhibit B. Thereafter, the Loan evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 9.4) be represented by one or more promissory notes in such form payable
to the order of the payee named therein (or, if such promissory note is a
registered note, to such payee and its registered assigns).
Section 2.6 Prepayment of Loans. (a) The Borrower shall have the right
at any time and from time to time to prepay the Loans 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 by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of the Eurodollar Loans, not later than 12:00 p.m. (noon), New York
City time, three Business Days before the date of prepayment or (ii) in the case
of prepayment of the ABR Loans, not later than 12:00 p.m. (noon), New York City
time, one Business Day before the date of prepayment. Each such notice shall be
irrevocable and shall specify the prepayment date and the principal amount of
the Loans to be prepaid. Promptly following receipt of any such notice the
Administrative Agent shall advise the Lenders of the contents thereof. Each
partial prepayment of the Loans shall be in an amount that is an integral
multiple of $1,000,000 and not less than $1,000,000. Each Prepayment of the
Loans shall be applied ratably to the Loans. Prepayments shall be accompanied by
accrued interest to the extent required by Section 2.8.
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(c) On any date on which the Borrower or any of its Subsidiaries
receives any proceeds from a Public Debt Offering, the Borrower shall prepay the
outstanding Loans in accordance with Section 2.6(b), together with any breakage
fees and other costs and expenses incurred hereunder in connection therewith, in
an amount equal to 100% of the cash proceeds obtained from such Public Debt
Offering by the Borrower or such Subsidiary minus (x) reasonable expenses
incurred or reasonably expected to be incurred in connection with such Public
Debt Offering and (y) any income, franchise, transfer or other tax payable by
the Borrower or such Subsidiary in connection with such transaction. The
Borrower shall provide the Administrative Agent prompt written notice of any
proposed Public Debt Offering and shall provide evidence of compliance herewith
reasonably satisfactory to the Administrative Agent on or prior to the closing
date of any such Public Debt Offering.
Section 2.7 Fees. (a) 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.
(b) All fees payable hereunder shall be paid on the dates due, in
immediately available funds. Fees paid shall not be refundable under any
circumstances.
Section 2.8 Interest. (a) ABR Loans shall bear interest at the ABR.
(b) Eurodollar Loans shall bear interest at the Adjusted LIBO
Rate for the Interest Period in effect for such Loans plus the Applicable
Margin.
(c) 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, the greater of (A) 2% plus the rate otherwise applicable to such Loan
as provided in the preceding paragraphs of this Section and (B) 2% plus the rate
applicable to ABR Loans or (ii) in the case of any other amount, 2% plus the
rate applicable to ABR Loans.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan 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 accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment, (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, and (iv)
all interest accrued and unpaid prior to the Maturity Date shall be payable on
the Maturity Date.
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(e) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the ABR at times
when the ABR 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 ABR or Adjusted LIBO Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.
Section 2.9 Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Loan:
(a) the Administrative Agent determines (which determination
shall be conclusive absent manifest 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 (or Lender) of maintaining their Loans
(or its Loan) for such Interest Period;
then 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 the Loans to, or continuation
of the Loans as Eurodollar Loans shall be ineffective and (ii) if the Loan
Request requests Eurodollar Loans, such Loans shall be made as ABR Loans.
Section 2.10 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
(ii) impose on any Lender or the London interbank market any
other condition affecting this Agreement or Eurodollar Loans made by such
Lender;
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 reduce the amount of any sum received or
receivable by such Lender (whether of principal, interest or otherwise), then
the Borrower will pay to such Lender such additional amount or amounts as will
compensate such Lender for such additional costs incurred or reduction suffered.
21
(b) If any Lender 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 holding company, if
any, as a consequence of this Agreement or the Loans made by such Lender to a
level below that which such Lender or such Lender's holding company could have
achieved but for such Change in Law (taking into consideration such Lender's
policies and the policies of such Lender's holding company with respect to
capital adequacy), then from time to time the Borrower will pay to such Lender
such additional amount or amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
(c) A certificate of a Lender setting forth the basis of the
calculations and the amount or amounts necessary to compensate such Lender 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
manifest error. The Borrower shall pay such Lender 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 to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender's right to demand such compensation; provided that the Borrower shall not
be required to compensate a Lender pursuant to this Section for any increased
costs or reductions incurred more than 180 days prior to the date that such
Lender notifies the Borrower of the Change in Law giving rise to such increased
costs or reductions and of such Lender'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 180-day period referred
to above shall be extended to include the period of retroactive effect thereof.
Section 2.11 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 Eurodollar Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.6(b) and is revoked in accordance therewith), (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
2.14, then, in any such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event (excluding loss of Applicable
Margin after the date of 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 (excluding loss of Applicable
Margin) 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
22
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 manifest error. The
Borrower shall pay such Lender the amount shown as due on any such certificate
within 10 days after receipt thereof.
Section 2.12 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 applicable to
additional sums payable under this Section) to the Administrative Agent or any
Lender (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 and
each Lender 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, as the case may be, on or with respect to any payment by or on account
of any obligation of the Borrower hereunder (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. The Borrower shall also indemnify the Administrative Agent and each
Lender, within 10 days after written demand therefor, for the full amount of
Excluded Taxes as the Administrative Agent or such Lender, as the case may be,
shall determine are payable in respect of amounts paid to or on behalf of the
Administrative Agent or such Lender, as the case may be, pursuant to this
Section 2.12. A certificate as to the amount of such payment or liability
delivered to the Borrower by a Lender, or by the Administrative Agent on its own
behalf or on behalf of a Lender, shall be conclusive absent manifest 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.
23
(e) Any Lender that is not incorporated under the United States
of America or a state thereof (each a "Foreign Lender") shall:
(i) on the date it becomes a Lender, deliver to the
Administrative Agent (A) two completed copies of United States Internal
Revenue Service Form 1001 or 4224, or successor applicable form, as the
case may be, and shall certify that it is entitled to receive payments
under this Agreement without deduction or withholding (or at a reduced rate
of deduction or withholding) of any United States Federal income taxes and
(B) an Internal Revenue Services Form W-8 or W-9, or successor applicable
form, as the case may be and shall certify that it is entitled to an
exemption from United States backup withholding tax;
(ii) deliver to the Administrative Agent two further copies
of any such form or certification on or before the date that any such
certification described above expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered to it; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the
Administrative Agent;
except that the forms and certificates described in clauses (ii) and (iii) above
shall not be required if any Change in Law has occurred prior to the date on
which any such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Administrative Agent.
Section 2.13 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 or fees, or of amounts payable under
Section 2.10, 2.11 or 2.12, or otherwise) prior to 12:00 noon, New York City
time, on the date when due, in immediately available funds, without set-off 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 that payments pursuant to
Sections 2.10, 2.11, 2.12 and 9.3 shall be made directly to the Persons entitled
thereto. The 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
24
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,
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 then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal 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 its Loan resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loan 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 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 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 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 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 the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender 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.
25
(e) If any Lender shall fail to make any payment required to be
made by it pursuant to Section 2.3 or 2.13(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 2.14 Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.10, 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 2.12, 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
amounts payable pursuant to Section 2.10 or 2.12, 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 (i) any Lender requests compensation under Section 2.10,
or (ii) 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
2.12, or (iii) any Lender defaults in its obligation to fund Loans hereunder, or
(iv) any Lender refuses to consent to certain proposed changes, waivers,
discharges or termination with respect to this Agreement which require the
consent of all Lenders and have been approved by the Required Lenders as (and to
the extent) provided in Section 9.2(b), then the Borrower may, at its sole
expense and effort, if no Default then exists (or, in the case of preceding
clause (iv), no Default will exist immediately upon giving effect to such
replacement), 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 9.4), 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) (such Assignee a "Replacement Lender"); provided that (x) the
Borrower shall have received the prior written consent of the Administrative
Agent which consent shall not unreasonably be withheld, (y) 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 Replacement Lender (to the extent of such outstanding
principal and accrued interest and fees) or the Borrower (in the case of all
other amounts) and (z) in the case of any such assignment resulting from a claim
for compensation under Section 2.10 or payments required to be made pursuant to
Section 2.12, such assignment will result in 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.
26
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
Section 3.1 Organization; Powers. Each of the Borrower and its
Subsidiaries is 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.
Section 3.2 Authorization; Enforceability. The Transactions are within
the Borrower's corporate powers and have been duly authorized by all necessary
corporate and, if required, stockholder action, and the use of proceeds of the
Loans will be, in each instance, within the Borrower's corporate powers and will
have been duly authorized by all necessary corporate and, if required,
stockholder action, as of the time of such use. This Agreement has been duly
executed and delivered by the Borrower and constitutes a legal, valid and
binding obligation of the Borrower, enforceable in accordance with its 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 3.3 Governmental Approvals; No Conflicts. The Transactions (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 any of their respective 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.
Section 3.4 Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders consolidated balance sheets and
statements of income, stockholders equity and cash flows for (i) FMI and its
subsidiaries, as of and for the fiscal year ended February 1, 1997, reported on
by Deloitte & Touche, independent public accountants of FMI, and the fiscal
quarter and the portion of the fiscal year ended May 24, 1997, certified by the
chief financial officer of FMI and (ii) ▇▇▇▇▇'▇ and its subsidiaries, as of and
for the fiscal year ended December 28, 1996, reported on by Ernst & Young LLP,
independent public accountants of ▇▇▇▇▇'▇, and the fiscal quarter and the
portion of the fiscal year ended April 5, 1997, certified by the chief financial
officer of ▇▇▇▇▇'▇.
27
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of FMI, ▇▇▇▇▇'▇ and
their respective 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 for the fiscal quarters.
(b) There has been no material adverse change in the business,
assets, operations, prospects or condition, financial or otherwise, of (i) FMI
and its subsidiaries, taken as a whole, since February 1, 1997, or (ii) ▇▇▇▇▇'▇
or its subsidiaries, taken as a whole, since December 28, 1996.
Section 3.5 Properties. (a) Each of the Borrower and its Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, except 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, subject to no Lien of any
kind except Liens permitted hereby.
(b) Each of the Borrower and 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.
Section 3.6 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 (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions.
(b) Except for the Disclosed Matters and except with respect to
any other 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.
(c) Since the date of this Agreement, there has been no change in
the status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.
Section 3.7 Compliance with Laws and Agreements. Each of the Borrower
and its Subsidiaries is in compliance with all laws, regulations and orders of
any
28
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 has occurred and is
continuing.
Section 3.8 Investment and Holding Company Status. Neither the
Borrower nor any of its Subsidiaries is (a) 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 3.9 Taxes. Each of the Borrower and 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 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.
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 is subject, and all other matters known to it, that,
individually or in the aggregate, could 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) 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 Solvency. On the Closing Date and after giving effect to
the Transactions, the Borrower and each of its Material Subsidiaries will be
Solvent.
Section 3.13 Use of Proceeds; Margin Regulations. All proceeds of each
of the Loans will be used by the Borrower only in accordance with the provisions
of Section 5.8. No part of the proceeds of any of the Loans will be used by the
Borrower to purchase or carry any Margin Stock or to extend credit to others for
the purpose of purchasing or carrying any Margin Stock. Neither the making of
any of the Loans nor the use of the
29
proceeds thereof will violate or be inconsistent with the provisions of
Regulations G, T, U or X of the Federal Reserve Board.
Section 3.14 No Default. The Borrower is not in default under or with
respect to any agreement, instrument or undertaking to which it is a party or by
which it or any of its property is bound in any respect which could result in a
Material Adverse Effect. No Default or Event of Default exists.
Section 3.15 Subsidiaries. After giving effect to the Merger, the
Persons listed on Schedule 3.15 are the only Subsidiaries of the Borrower.
Schedule 3.15 correctly sets forth, after giving effect to the Merger, the
percentage ownership (direct and indirect) of the Borrower in each class of
capital stock of each of its Subsidiaries, identifies the direct owner thereof
and identifies each Material Subsidiary as of the Closing Date.
ARTICLE IV
Conditions
Section 4.1 Closing Date. The obligations of the Lenders to make Loans
hereunder are subject to the satisfaction (or waiver in accordance with Section
9.2) of the following conditions:
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto (A) either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the 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 and
(B) such other documents, in form and substance satisfactory to the
Administrative agent, as the Administrative Agent may reasonably request.
(b) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders and dated
the Closing Date) of Stoel Rives LLP, counsel for the Borrower, substantially in
the form of Exhibit C, and covering such other matters relating to the Borrower,
this Agreement or the Transactions as the Required Lenders shall reasonably
request. The Borrower hereby requests such counsel to deliver such opinion.
(c) The Administrative Agent shall have received such documents
and certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of the
Borrower, the authorization of the Transactions and any other legal matters
relating to the Borrower, this Agreement or the Transactions, all in form and
substance satisfactory to the Administrative Agent and its counsel.
30
(d) The Administrative Agent shall have received a certificate,
dated the Closing Date and signed by the President, a Vice President or a
Financial Officer of the Borrower, confirming that (i) the representations and
warranties contained in Article III are true and correct and (ii) at the time of
and immediately after giving effect to the Loans, no Default shall have occurred
and be continuing.
(e) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Closing 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 Merger shall have been completed in accordance with the
Merger Document, or on other terms reasonably satisfactory to the Lenders.
(g) The Other Corporate Loan Documents shall have been executed
and delivered and shall be in full force and effect.
(h) Each Material Subsidiary shall have executed and delivered to
the Administrative Agent a guaranty substantially in the form set forth as
Exhibit D (each such guaranty, as amended, supplemented or otherwise modified, a
"Subsidiary Guaranty").
(i) The Administrative Agent shall have received evidence
satisfactory to it of prior or simultaneous repayment or refinancing of the Debt
of the Borrower and its Subsidiaries set forth on Schedule 4.1 hereto (except as
otherwise agreed to the satisfaction of the Agents).
(j) The Administrative Agent shall have received the financial
information required under Section 3.4(a), including a pro forma balance sheet
giving effect to the Merger, in form and substance satisfactory to the
Administrative Agent.
(k) The Administrative Agent shall have received a fully executed
Loan Request in respect of the Loans to be made on such date.
ARTICLE V
Affirmative Covenants
Until the principal of and interest on the Loans and all fees payable
hereunder shall have been paid in full, the Borrower covenants and agrees with
the Lenders that:
Section 5.1 Financial Statements and Other Information. The Borrower
will furnish to the Administrative Agent and each Lender:
31
(a) within 100 days after the end of each fiscal year of the
Borrower, its audited consolidated balance sheet and related statements 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 Deloitte & Touche 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.
(b) within 55 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, its consolidated balance
sheet 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 or periods of (or, in the case of the balance sheet, as of
the end of) the previous 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 basis in accordance with GAAP, 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 Compliance Certificate (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 (x) demonstrating compliance with
Section 6.10(a) and (b) and (y) establishing the Applicable Margin, 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 3.4
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate;
(d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on such
financial statements stating whether they obtained knowledge during the course
of their examination of such financial statements of any Default (which
certificate may be limited to the extent required by accounting rules or
guidelines);
(e) 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
32
(f) 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, as the Administrative Agent or any Lender may reasonably request.
Section 5.2 Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default upon actual knowledge of a
Responsible Officer of the Borrower;
(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 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 material liability of the Borrower and its Subsidiaries; 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 5.3 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
6.5.
Section 5.4 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 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.
33
Section 5.5 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
(and having such deductibles and self-insurance) as are customarily maintained
by companies engaged in the same or similar businesses operating in the same or
similar locations.
Section 5.6 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 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 5.7 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, including
without limitation ERISA and all 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 5.8 Use of Proceeds. The proceeds of the Loans will be used
only to finance certain costs and expenses associated with the Merger, refinance
existing indebtedness (including related prepayment premiums) and for general
corporate purposes. 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 G, U and X.
Section 5.9 Subsidiary Guaranties. The Borrower shall cause each
Material Subsidiary, now or hereafter in existence, to execute and deliver to
the Administrative Agent a Subsidiary Guaranty together with such officer's
certificates, resolutions and other assurances related thereto as the
Administrative Agent shall reasonably request upon the earlier of (i) with
respect to any Subsidiary on the date hereof that becomes a Material Subsidiary
after the date hereof, or as to any Person which, when it becomes a Subsidiary
after the date hereof, is not then a Material Subsidiary, as soon as possible
after the end of the fiscal quarter in which such Subsidiary becomes a Material
Subsidiary, and (ii) with respect to any Material Subsidiary acquired after the
date hereof not currently a Subsidiary, within 10 days of becoming a Material
Subsidiary.
Section 5.10 Syndication. The Borrower acknowledges and agrees that
the initial Lenders may, but shall have no obligation to, assign portions of the
outstanding Loans to a syndicate of lenders in accordance with the terms of
Section 9.4. In such case, the
34
Borrower shall actively assist the Lenders in completing a syndication
reasonably satisfactory to the Lenders. In furtherance of such syndication, the
Borrower shall (i) use commercially reasonable efforts to ensure that the
syndication efforts benefit materially from the Borrower's existing lending
relationships, (ii) cooperate in establishing direct contact between senior
management and advisors of the Borrower and its Material Subsidiaries and the
proposed lenders, (iii) assist in the preparation of one or more confidential
information memoranda and other marketing materials to be used in connection
with such syndication and (iv) cooperate in hosting, with the Lenders, one or
more meetings of prospective lenders.
ARTICLE VI
Negative Covenants
Until the principal of and interest on each Loan and all fees payable
hereunder shall have been paid in full, the Borrower covenants and agrees with
the Lenders that:
Section 6.1 Material Subsidiary Debt. The Borrower will not permit any
Material Subsidiary to create, incur, assume or permit to exist any Debt,
except:
(a) Debt owed to the Borrower or to another Material Subsidiary;
(b) Debt existing on the date hereof; provided that to the extent
any item of such Debt exceeds $5,000,000, or the aggregate of all such Debt
exceeds $25,000,000, such Debt shall be identified in Schedule 6.1;
(c) Debt secured by Permitted Encumbrances;
(d) Capital Lease Obligations not to exceed $100,000,000;
(e) Debt outstanding when such Person becomes a Material
Subsidiary or is merged or consolidated with another Material Subsidiary,
provided that such Debt exists at the time such Person becomes a Material
Subsidiary and is not created in contemplation of or in connection with such
Person becoming a Material Subsidiary;
(f) Debt in respect of commercial letters of credit issued to
support the purchase of goods by the applicable Material Subsidiary in the
ordinary course of business;
(g) Debt in respect of commercial letters of credit issued to
support liabilities of a Material Subsidiary relating to worker's compensation,
judgments pending appeal (and as to which there is no Event of Default under
clause (k) of Article VII), construction or similar liabilities in the ordinary
course of business;
35
(h) Suretyship Liabilities constituting guarantees of the
Borrower's unsecured Debt; provided such Debt is pari passu with the obligations
of the Borrower hereunder; and
(i) Debt in respect of Synthetic Lease Facilities entered into by
any Material Subsidiary as lessee thereunder; and
(j) Debt not otherwise permitted by the foregoing clauses of this
Section 6.1 so long as the sum, without duplication, of (x) all such Debt and
(y) all Debt secured by Liens permitted solely by clause (f) of Section 6.2 does
not exceed 10% of Consolidated Total Assets.
Section 6.2 Liens. The Borrower will not, and will not permit any
Subsidiary 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 (including Liens created pursuant to the
Current Synthetic Lease Facility) and set forth in Schedule 6.2; provided that
(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;
(c) any Lien 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 and
(iii) 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; and
(d) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary; provided that (i) such security
interests and the Indebtedness secured thereby are incurred prior to or within
180 days after such acquisition or the completion of such construction or
improvement, (ii) the Debt secured thereby does not exceed the cost of
acquiring, constructing or improving such fixed or capital assets and (iii) such
security interests shall not apply to any other property or assets of the
Borrower or any Subsidiary;
(e) Liens on assets acquired after the date hereof under
Synthetic Lease Facilities; and
36
(f) Liens not otherwise permitted by the foregoing clauses of
this Section 6.2, securing Debt of the Borrower or its Subsidiaries, so long as
the sum, without duplication, of (i) all such Debt and (ii) all Debt permitted
solely by clause (j) of Section 6.1 does not exceed 10% of Consolidated Total
Assets
Section 6.3 Modifications of Merger Document. The Borrower shall not,
and shall not permit any of its Subsidiaries to amend, modify or waive, or
permit the amendment, modification or waiver of, any provision of the Merger
Document.
Section 6.4 Fundamental Changes. (a) The Borrower will not, and will
not permit any Material Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
sell, transfer, lease or otherwise dispose of (in one transaction or in a series
of transactions) all or any substantial part of its assets, or all or
substantially all of the stock of any 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 Subsidiary may merge into the Borrower
in a transaction in which the Borrower is the surviving corporation, (ii) any
Subsidiary may merge into any Subsidiary in a transaction in which the surviving
entity is a Subsidiary, (iii) any Subsidiary may sell, transfer, lease or
otherwise dispose of its assets to the Borrower or to another Subsidiary and
(iv) any 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.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrower and its Subsidiaries on the
date of execution of this Agreement and businesses reasonably related thereto.
Section 6.5 Investments, Loans, Advances, Suretyship Liabilities and
Acquisitions. The Borrower will not, and will not permit any of its Material
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, incur Suretyship Liabilities in
respect of 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) investments by the Borrower and its Subsidiaries in its
Material Subsidiaries, or any Subsidiary which is not a Material Subsidiary so
long as such non-
37
Material Subsidiary executes and delivers a Subsidiary Guaranty in favor of the
Administrative Agent;
(c) loans or advances made, or Suretyship Liabilities incurred,
by the Borrower to or in respect of any Subsidiary and made or incurred by any
Subsidiary to or in respect of the Borrower or any other Subsidiary;
(d) Suretyship Liabilities with respect to Hedging Agreements
permitted by Section 6.6;
(e) Suretyship Liabilities constituting Debt permitted by Section
6.1;
(f) Suretyship Liabilities created under the Other Corporate Loan
Documents;
(g) Suretyship Liabilities with respect to Surety Instruments
incurred in the ordinary course of business; and
(h) investments by the Borrower and its Material Subsidiaries not
otherwise permitted by the foregoing clauses of this Section 6.5, so long as
such additional investments made in reliance on this clause (h) do not exceed
$100,000,000 in the aggregate at any time.
Section 6.6 Hedging Agreements. The Borrower will not, and will not
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 any Subsidiary is exposed in the conduct
of its business or the management of its liabilities.
Section 6.7 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 that, so long as no Event
of Default has occurred and is continuing, (a) the Borrower may declare and pay
dividends with respect to its capital stock payable solely in additional shares
of its common stock, (b) the Borrower may make Restricted Payments pursuant to
and in accordance with stock option plans or other benefit plans for management
or employees of the Borrower and its Subsidiaries, (c) any Subsidiary may
declare and pay Restricted Payments to the Borrower or any other Subsidiary, and
(d) from and after the fiscal year ending January 31, 1998, the Borrower and its
Subsidiaries may pay cash dividends and repurchase their respective stock from
any Person which is not the Borrower or another Subsidiary so long as on the
date of payment or repurchase (i) such cash dividends and stock repurchases do
not exceed $100,000,000 in any single fiscal year, and (ii) the total of such
cash dividends and stock repurchases in all such fiscal years (beginning with
the fiscal year ending January 31, 1998) does not exceed an aggregate amount of
$200,000,000 plus 40% of the Borrower's and its Subsidiaries' aggregate net
38
income earned commencing with the fiscal year ending January 31, 1998, and each
fiscal year thereafter.
Section 6.8 Transactions with Affiliates. The Borrower will not, and
will not permit any of its Subsidiaries to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) at prices and on terms and conditions not less favorable
to the Borrower or such Subsidiary than could be obtained on an arm's-length
basis from unrelated third parties, (b) transactions between or among the
Borrower and its wholly owned Subsidiaries not involving any other Affiliate and
(c) any Restricted Payment permitted by Section 6.7.
Section 6.9 Restrictive Agreements. The Borrower will not, and will
not 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 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 incur
Suretyship Liabilities in respect of Debt 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 (x) contained in the Other Corporate Loan
Documents or (y) existing on the date hereof and identified on Schedule 6.9 (but
shall apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition) and (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 and provided further that such restrictions and
conditions cannot be imposed at any time that a Default has occurred and is
continuing.
Section 6.10 Financial Covenants.
(a) Debt for Borrowed Money to Consolidated EBITDA Ratio. The
Borrower shall not permit the ratio of its Debt for Borrowed Money to
Consolidated EBITDA (for the most recent four consecutive quarters) to exceed,
at the end of any fiscal quarter ending on or during any period listed below,
the ratio set forth opposite such period:
Period Ratio
------ -----
From and including January 31, 1998, 4.00:1
to and including January 29, 1999
From and including January 30, 1999 3.75:1
to and including January 28, 2000
39
From and including January 29, 2000 3.35:1
to and including February 2, 2001
From and including February 3, 2001, 3.00:1
and thereafter
provided, however, that Consolidated EBITDA of the Borrower and its Subsidiaries
for the four quarter periods ended January 31, 1998, May 23, 1998 and August 15,
1998 shall be calculated by reference to (i) for each fiscal quarter ended after
the Closing Date, the actual Consolidated EBITDA for such fiscal quarter, and
(ii) for each fiscal quarter ended prior to the Closing Date, Consolidated
EBITDA reflected in a pro-forma income statement for such fiscal quarter
prepared by the Borrower in good faith using reasonable assumptions consistent
with all facts known to the Borrower.
(b) Adjusted Interest Coverage Ratio. The Borrower shall not
permit the Adjusted Interest Coverage Ratio (for the most recent four
consecutive quarters, except as specified below) to be less than, at the end of
any fiscal quarter ending on or during any period listed below, the Adjusted
Interest Coverage Ratio set forth opposite such period:
Period Ratio
------ -----
From and including January 31, 1998 2.25:1
to and including January 29, 1999
From and including January 30, 1999 2.50:1
and thereafter
provided, however, that for the periods ended January 31, 1998, May 23, 1998 and
August 15, 1998 the Adjusted Interest Coverage Ratio for such period shall be
calculated by reference to the full fiscal quarters then ended since the Closing
Date.
Section 6.11 Unconditional Purchase Obligations. The Borrower shall
not, and shall not permit any Material Subsidiary to, enter into or be a party
to any contract for the purchase of materials, supplies or other property or
services, if such contract requires that payments be made by it regardless of
whether or not delivery is ever made of such materials, supplies or other
property or services.
Section 6.12 Sale of Assets; Sale and Leaseback Transactions. (a)
Except as provided in Section 6.12(d), subject to the terms and conditions of
this Agreement, the Borrower and its Subsidiaries may convey, sell, transfer or
otherwise dispose of (or agree to do so at any future time) its property or
assets, provided that to the extent the sum of the fair market value of such
property or assets (i) conveyed, sold, transferred or otherwise disposed of and
(ii) all transactions pursuant to Section 6.12(b), exceeds $350,000,000 at any
time, the Borrower shall comply with the provisions of Section 6.12(c). The
foregoing limitations shall
40
not apply to the conveyance, sale, transfer or other disposal of property or
assets in the case of sales of inventory in the ordinary course of business and
sales of equipment which is uneconomic, obsolete or no longer useful in its
business.
(b) Except as provided in Section 6.12(d), the Borrower and its
Subsidiaries may become liable, directly or indirectly, with respect to any
lease, whether an operating lease or a capital lease, of any property (whether
real or personal or mixed) whether now owned or hereafter acquired, (i) which
the Borrower or such Subsidiary has sold or transferred or is to sell or
transfer to any other Person, or (ii) which the Borrower or such Subsidiary
intends to use for substantially the same purposes as any other property which
has been or is to be sold or transferred by the Borrower or such Subsidiary to
any other Person in connection with such lease (such transaction a "Sale and
Leaseback Transaction"), provided that to the extent the sum of the fair market
value of the property or assets (i) conveyed, sold, transferred or otherwise
disposed of pursuant to Section 6.12(a) and (ii) all transactions pursuant to
Section 6.12(b) exceeds $350,000,000 at any time, the Borrower shall comply with
the provisions of Section 6.12(c).
(c) In the event that the aggregate fair market value of all
assets sold in all transactions undertaken in reliance upon Sections 6.12(a) and
(b) exceeds $350,000,000, the Borrower shall prepay the outstanding Loans in
accordance with Section 2.6, together with any breakage fees and other costs and
expenses incurred hereunder in connection therewith, in an amount equal to 50%
of such excess minus (x) reasonable expenses incurred or reasonably expected to
be incurred in connection with such transaction and (y) any income, franchise,
transfer or other tax payable in connection with such transaction. The Borrower
shall provide the Administrative Agent prompt written notice of any transaction
entered into in reliance upon this Section 6.12(c), and shall provide evidence
of compliance herewith reasonably satisfactory to the Administrator Agent on or
prior to the closing date of any such transaction.
(d) Notwithstanding the provisions of Section 6.12(a), (b) and
(c) above, ▇▇▇▇▇'▇ and any subsidiary of ▇▇▇▇▇'▇ may convey, sell, transfer or
dispose of, or enter into Sale and Leaseback Transactions in connection with,
assets owned as of the Closing Date by ▇▇▇▇▇'▇ or any of its subsidiaries;
provided that on each date on which ▇▇▇▇▇'▇ or any such subsidiary of ▇▇▇▇▇'▇
receives any proceeds from any such transaction, the Borrower shall prepay the
outstanding Loans in accordance with Section 2.6, together with any breakage
fees and other costs and expenses incurred hereunder in connection therewith, in
an amount equal to 50% of the cash proceeds obtained in such transaction by
▇▇▇▇▇'▇ or such subsidiary of ▇▇▇▇▇'▇ minus (x) reasonable expenses incurred or
reasonably expected to be incurred in connection with such transaction, (y) any
income, franchise, transfer or other tax payable by ▇▇▇▇▇'▇ or such subsidiary
of ▇▇▇▇▇'▇ in connection with such transaction and (z) any Debt secured by a
Lien on such property or assets and required to be repaid as a result of such
transaction. The Borrower shall provide the Administrative Agent prompt written
notice of any transaction entered into in reliance upon this Section 6.12(d),
and shall provide evidence
41
of compliance herewith reasonably satisfactory to the Administrator Agent on or
prior to the closing date of any such transaction.
Section 6.13 Fiscal Year; Fiscal Quarter. The Borrower shall not, and
shall not permit any of its Subsidiaries to, change its fiscal year or any of
its fiscal quarters.
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 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; or
(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 this Agreement, when and as the same shall become
due and payable, and such failure shall continue unremedied for a period of
three (3) Business Days; or
(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 amendment or modification hereof or waiver hereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or in
connection with this Agreement or any amendment or modification hereof or waiver
hereunder, shall prove to have been incorrect in any material respect when made
or deemed made; or
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Sections 5.2(a), 5.3 (with respect to the
Borrower's existence) or 5.8 or in Sections 6.1, 6.2, 6.4, 6.5, 6.6, 6.7, 6.9,
6.10, 6.11 or 6.12; or
(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 notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the request
of any Lender); or
(f) the Borrower or any Material Subsidiary shall fail to make
any payment (whether of principal or interest and regardless of amount) in
respect of any Material Debt, when and as the same shall become due and payable
or within any applicable grace period in connection with such Material Debt; or
42
(g) the Borrower or any Material Subsidiary shall default in any
other obligation that results in any Debt of $10,000,000 or more in the
aggregate 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 Debt of $10,000,000 or more in the aggregate or any
trustee or agent on its or their behalf to cause any such Debt to become due, or
to require the prepayment, repurchase, redemption or defeasance thereof, prior
to its scheduled maturity; or
(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 Material Subsidiary or their
respective debts, or of a substantial part of their respective 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
Material Subsidiary or for a substantial part of their respective assets, and,
in any such case, such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered; or
(i) the Borrower or any Material 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 Material Subsidiary or
for a substantial part of their respective 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; or
(j) the Borrower or any Material Subsidiary shall become unable,
admit in writing or fail generally to pay its debts as they become due; or
(k) one or more judgments for the payment of money in an
aggregate amount in excess of $5,000,000 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; or
(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 $5,000,000; or
43
(m) a Change in Control shall occur; or
(n) any Subsidiary Guaranty shall cease to be in full force and
effect, or any guarantor under any Subsidiary Guaranty or any Person acting by
or on behalf of such guarantor shall deny or disaffirm all or any portion of the
guarantor's obligation under such Subsidiary Guaranty;
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 Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) 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
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
Section 8.1 Appointment. Each Lender hereby irrevocably designates and
appoints Bankers Trust Company as the Administrative Agent of such Lender under
this Agreement, and each such Lender irrevocably authorizes Bankers Trust
Company as the Administrative Agent for such Lender, to take such action on its
behalf under the provisions of this Agreement and to exercise such powers and
perform such duties as are expressly delegated to the Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Administrative Agent shall be read into this
Agreement or otherwise exist against the Administrative Agent. The provisions of
this Article 8 are solely for the benefit of the Administrative Agent and the
Lenders and the Borrower shall have no rights as a third party beneficiary or
otherwise under any of the provisions hereof. In performing its functions and
duties hereunder, the Administrative Agent shall act solely as the agent of the
Lenders and
44
does not assume nor shall be deemed to have assumed any obligation or
relationship of trust or agency with or for the Borrower or any of its
successors and assigns.
Section 8.2 Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct or any agents or attorneys-in-fact selected by it with
reasonable care.
Section 8.3 Exculpatory Provisions. The Administrative Agent shall not
be (i) liable for any action lawfully taken or omitted to be taken by it or any
Person described in Section 8.2 under or in connection with this Agreement
(except for its or such Person's own gross negligence or willful misconduct), or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower contained in this
Agreement or in any certificate, report, statement or other document referred to
or provided for in, or received under or in connection with, this Agreement or
for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement, or for any failure of the Borrower to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books or records of the Borrower. This
Section is intended solely to govern the relationship between the Administrative
Agent, on the one hand, and the Lenders, on the other.
Section 8.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement in accordance with a request of the Required Lenders, and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders.
Section 8.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default and stating that such notice is a
"notice of default". In the event that
45
the Administrative Agent receives such a notice, the Administrative Agent shall
promptly give notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default as shall be directed by the Required
Lenders; provided that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as the Administrative Agent shall deem advisable and in the best
interests of the Lenders.
Section 8.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent, nor
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereafter taken, including, without limitation, any
review of the affairs of the Borrower, shall be deemed to constitute any
representation or warranty by the Administrative Agent. Each Lender represents
and warrants to the Administrative Agent that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, operations, property, prospects,
financial and other conditions and creditworthiness of the Borrower and made its
own decision to make its Loans hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative 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 analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, prospects, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required under this Agreement to be furnished to the
Lenders by the Administrative Agent, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, prospects, financial
and other condition or creditworthiness of the Borrower which may come into the
possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
Section 8.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent, the Syndication Agent and each of their respective
officers, directors, employees, representatives and agents (to the extent not
reimbursed by the Borrower and without limiting the obligation of the Borrower
to do so), ratably according to their Applicable Percentage, from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever (including, without limitation, the fees and disbursements of counsel
for the Administrative Agent, Syndication Agent or such Person in connection
with any investigative, administrative or judicial proceeding commenced or
threatened, whether or not the Administrative Agent or such Person shall be
designated a party thereto) that may at any time (including, without limitation,
at any time following the payment of the Obligations) be imposed on, incurred by
or asserted against the Administrative Agent, Syndication Agent or
46
such Person as a result of, or arising out of, or in any way related to or by
reason of, any of the Transactions or the execution, delivery or performance of
this Agreement (but excluding any such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the gross negligence or willful misconduct of the
Administrative Agent, Syndication Agent or such Person as finally determined by
a court of competent jurisdiction).
Section 8.8 Administrative Agent in its Individual Capacity. The
Administrative Agent and its affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder. With respect
to Loans made or renewed by it, the Administrative Agent shall have the same
rights and powers under this Agreement as any Lender and may exercise the same
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
Section 8.9 Successor Administrative Agent. The Administrative Agent
may resign as Administrative Agent upon 30 days' notice to the Borrower and the
Lenders. If the Administrative Agent shall resign as Administrative Agent under
this Agreement, then the Required Lenders during such 30-day period shall
appoint from among the Lenders a successor agent, whereupon such successor agent
shall succeed to the rights, powers and duties of the Administrative Agent and
the term "Administrative Agent" shall mean such successor agent, effective upon
its appointment, and the former Administrative Agent's rights, powers and duties
as Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement. After any retiring Administrative Agent's resignation hereunder
as Administrative Agent, the provisions of this Section 8 and Section 9.3 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement.
Section 8.10 Syndication Agent. Without limiting any provision
contained in this Section 8, the Syndication Agent shall not have, except as to
and to the limited extent expressly provided herein, any obligation,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. Each Lender acknowledges that it has not relied, and will not
rely, on the Syndication Agent in deciding to enter into this Agreement or in
taking or not taking action hereunder.
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ARTICLE IX
Miscellaneous
Section 9.1 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:
▇▇▇▇ ▇▇▇▇▇, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇;
with a copy of notices pursuant to Article VII to:
Stoel Rives LLP
▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇
(b) if to the Administrative Agent, to it at:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: Deal Administrator
(c) if to any other Lender, to it at its address (or telecopy
number) set forth opposite its signature below.
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. It
is understood and agreed that the delivery of copies of notices to counsel as
set forth above is for courtesy purposes only and any failure to deliver such
copy shall not constitute failure with respect to any obligation to provide
notices hereunder.
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Section 9.2 Waivers; Amendments. (a) Neither this Agreement nor any
terms hereof may be changed, waived, discharged or terminated unless such
change, waiver, discharge or termination is in writing signed by the Required
Lenders, provided that no such change, waiver, discharge or termination shall,
without the consent of each Lender, (i) extend the final scheduled maturity of
any Loan beyond the Maturity Date, or reduce the rate or extend the time of
payment of interest or fees thereon, or reduce the principal amount thereof
(except to the extent repaid in cash), (ii) amend, modify or waive any provision
of this Section 9.2, (iii) reduce the percentage specified in the definition of
Required Lenders, (iv) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement or (v) release any
Subsidiary which is party to a Subsidiary Guaranty form its obligations under
such Subsidiary Guaranty; provided further that no such change, waiver,
discharge or termination shall (x) increase the Loan Amount of any Lender (it
being understood that waivers or modifications of conditions precedent,
covenants, Defaults or of a mandatory reduction in the Loan Amounts shall not
constitute an increase in the Loan Amount of any Lender) or (y) without the
consent of the Administrative Agent, amend, modify or waive any provision of
Section 8 or any other provision as the same relates to the Administrative
Agent. No failure or delay by the Administrative Agent 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 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.
(b) If, in connection with any proposed change, waiver, discharge
or termination to any of the provisions of this Agreement contemplated by
clauses (i) through (v), inclusive, of the first proviso of Section 9.2(a), the
consent of the Required Lenders is obtained but the consent of one or more of
such other Lenders whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Lenders whose individual
consent is required are treated as described in either clauses (A) or (B) below,
to either (A) replace each such non-consenting Lender or Lenders with one or
more Replacement Lenders pursuant to Section 2.14(b) so long as at the time of
such replacement each such Replacement Lender consents to the proposed change,
waiver, discharge or termination or (B) repay the outstanding Loans of such
Lender; provided that, unless the Loans repaid pursuant to preceding clause (B)
are immediately replaced in full at such time through the addition of new
Lenders or the increase of outstanding Loans of existing Lenders (who in each
case must specifically consent thereto), then in the case of any action pursuant
to preceding clause (B) the Required Lenders (determined after giving effect to
the proposed action) shall specifically consent thereto, provided further, that
in any event the Borrower shall not have the right to replace a Lender or repay
its Loans solely as a result of the
49
exercise of such Lender's rights (and the withholding of any required consent by
such Lender) pursuant to the second proviso to Section 9.2(a).
Section 9.3 Expenses; Indemnity; Damage Waiver. (a) The Borrower shall
pay (i) all reasonable out-of-pocket expenses incurred by the Administrative
Agent and its Affiliates, including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent, in connection with the
syndication of the credit facilities provided for herein, the preparation and
administration of this Agreement or any amendments, modifications or waivers of
the provisions hereof (whether or not the transactions contemplated hereby or
thereby shall be consummated) and (ii) all out-of-pocket expenses incurred by
the Administrative Agent or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement after the occurrence of an Event of Default, including its rights
under this Section, or in connection with the Loans made hereunder, including
all such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans.
(b) The Borrower shall indemnify the Administrative Agent 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 of this Agreement or any
agreement or instrument contemplated hereby, the performance by the parties
hereto of their respective obligations hereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or the
use of the proceeds therefrom, (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 permitted by applicable law, the Borrower shall
not assert, and 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 or any agreement or instrument contemplated hereby,
the Transactions, any Loan or the use of the proceeds thereof.
50
(d) All amounts due under this Section shall be payable not later
than 10 days after written demand therefor.
Section 9.4 Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that 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). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent and
the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Loan); provided that (i) except in the case of an assignment to a
Lender or an Affiliate of a Lender, the Borrower must give its prior written
consent to such assignment (which consent shall not be unreasonably withheld),
(ii) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender's Loan,
the amount of the Loan 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
$5,000,000 unless each of the Borrower and the Administrative Agent otherwise
consent, (iii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement, and (iii) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together with
a processing and recordation fee of $3,500; and provided further that any
consent of the Borrower otherwise required under this paragraph shall not be
required if a Default has occurred and is continuing. Subject to acceptance and
recording thereof pursuant to paragraph (d) of this Section, 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 2.10, 2.11, 2.12 and 9.3). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph 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 (e) of this Section.
51
(c) The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in The City of New York 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 principal amount of
the Loans 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 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 and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(d) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an assignee, 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
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.
(e) 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 the Loan owing to it);
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent 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 or instrument 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; and provided further
that no Lender shall transfer or grant any participation under which the
Participants shall have rights to approve any amendment to or waiver of this
Agreement except to the extent that such amendment or waiver would (i) extend
the final scheduled maturity of any Loan or Note in which the Participant is
participating, or reduce the rate or extend the time of payment of interest or
fees thereon (except in connection with a waiver of applicability of any
post-default increase in interest rates) or reduce the principal amount thereof,
or increase the amount of the Participant's participation over the amount
thereof then in effect (it being understood that a waiver of any Default or of a
mandatory reduction in the aggregate Loan Amounts shall not constitute a change
in the terms of such participation or (ii) consent to the assignment by the
Borrower of any of its rights and obligations under this Agreement.
(f) A Participant shall not be entitled to receive any greater
payment under Section 2.10 or 2.12 than the applicable Lender would have been
entitled to receive
52
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. A Participant that, subject to the foregoing, would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.12 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
2.12(e) as though it were a Lender.
(g) 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.
Section 9.5 Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement 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, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent 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 is outstanding and
unpaid. The provisions of Sections 2.10, 2.11, 2.12 and 9.3 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 or the
termination of this Agreement or any provision hereof.
Section 9.6 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 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. Except as provided in
Section 4.1, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the 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.
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Section 9.7 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.
Section 9.8 Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other 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 9.9 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.
(b) The Borrower hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the United
States District Court of the Southern District of 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
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.
54
(d) Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 9.1. 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 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 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) to any participant or prospective participant in or
assignee or prospective assignee of any of the rights and obligations under this
Agreement, provided that such participant, prospective participant, assignee or
prospective assignee agrees to be bound by the confidentiality provisions
contained in this Section 9.12, (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 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
business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the
55
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 OREGON LEGAL NOTICE. WITHOUT LIMITING THE VALIDITY OF THE
CHOICE OF NEW YORK LAW PROVIDED HEREIN, UNDER OREGON LAW, MOST AGREEMENTS,
PROMISES AND COMMITMENTS MADE BY THE LENDERS AFTER THE EFFECTIVE DATE OF THE ACT
SPECIFIED HEREIN CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR
PERSONAL FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S
RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY THE LENDERS
TO BE ENFORCEABLE. THE ACT SPECIFIED HEREIN MEANS CHAPTER 967 OREGON LAWS 1989,
THE EFFECTIVE DATE OF WHICH WAS OCTOBER 3, 1989.
56
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.
▇▇▇▇▇-▇▇▇▇▇ HOLDCO, INC.
as Borrower
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President, Treasurer
S-1
BANKERS TRUST COMPANY,
as Administrative Agent and as a Lender
By: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
-------------------------------------
Name: May ▇▇▇ ▇▇▇▇▇
Title: Managing Director
S-2
THE CHASE MANHATTAN BANK,
as Syndication Agent and as a Lender
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
S-3
Schedule 2.1
Lenders and Commitments
Name and Address of Lender Amount of Commitment
-------------------------- --------------------
Bankers Trust Company $250,000,000.00
One Bankers Trust Plaza
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: Deal Administrator
The Chase Manhattan Bank $250,000,000.00
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (212)
Attn:
1