1
EXHIBIT (10)H
SECOND AMENDED, RESTATED AND
MODIFIED LOAN AGREEMENT
Dated as of July 16, 2001
among
GENESCO INC.,
as Borrower,
THE BANKS IDENTIFIED HEREIN
and
BANK OF AMERICA, N.A.,
as Agent
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS.......................................................................1
1.1 Definitions.....................................................................................1
1.2 Accounting Terms...............................................................................16
1.3 Other Definitional Provisions..................................................................16
ARTICLE II LOANS................................................................................................16
2.1 Commitment.....................................................................................16
2.2 Revolving Loans Advances.......................................................................16
2.3 Repayment......................................................................................17
2.4 Interest.......................................................................................18
2.5 Revolving Notes................................................................................18
2.6 Letters of Credit..............................................................................18
2.7 Termination of Commitments.....................................................................23
2.8 Fees...........................................................................................23
ARTICLE III ADDITIONAL PROVISIONS REGARDING LOANS...............................................................24
3.1 Default Rate...................................................................................24
3.2 Prepayments....................................................................................24
3.3 Conversion.....................................................................................25
3.4 Increased Costs, Illegality, etc...............................................................26
3.5 Increased Costs and Reduced Return.............................................................27
3.6 Compensation...................................................................................28
3.7 Taxes..........................................................................................29
3.8 Change of Lending Office.......................................................................31
3.9 Late Payment Fee...............................................................................31
3.10 Payments and Computations......................................................................31
3.11 Replacement or Removal of Bank.................................................................32
3.12 Advances.......................................................................................33
ARTICLE IV CONDITIONS PRECEDENT TO ALL LOANS AND ISSUANCE OF LETTERS OF CREDIT..................................34
4.1 Conditions to Initial Loans and Letters of Credit..............................................34
4.2 Conditions to all Loans and Letters of Credit..................................................35
ARTICLE V REPRESENTATIONS AND WARRANTIES........................................................................36
5.1 Organization and Power; Qualification; Good Standing; Subsidiaries.............................36
5.2 Authorization of Borrowing; No Conflicts; Binding Obligations; etc.............................37
5.3 Financial Condition; No Changes................................................................37
5.4 Title to Properties; Liens.....................................................................38
5.5 Litigation.....................................................................................38
5.6 Compliance with Law............................................................................38
5.7 Payment of Taxes...............................................................................39
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5.8 Contractual Obligations: Performance...........................................................39
5.9 Environmental Protection.......................................................................39
5.10 Employee Benefit Plans.........................................................................40
5.11 Certain Fees...................................................................................40
5.12 Defaults.......................................................................................40
5.13 Disclosure.....................................................................................40
5.14 Margin Stock...................................................................................41
ARTICLE VI AFFIRMATIVE COVENANTS................................................................................41
6.1 Financial Statements and Other Reports.........................................................41
6.2 Corporate Existence, etc.......................................................................44
6.3 Payment of Taxes and Claims....................................................................44
6.4 Maintenance of Properties; Insurance...........................................................45
6.5 Inspection.....................................................................................45
6.6 Compliance with Laws, etc......................................................................45
6.7 Pari Passu.....................................................................................45
ARTICLE VII NEGATIVE COVENANTS..................................................................................46
7.1 Liens..........................................................................................46
7.2 Investments....................................................................................48
7.3 Contingent Obligations.........................................................................49
7.4 Restricted Payments............................................................................50
7.5 Financial Covenants............................................................................50
7.6 Restrictions on Fundamental Changes............................................................52
7.7 ERISA..........................................................................................52
7.8 Transactions with Shareholders and Affiliates..................................................52
7.9 Subsidiary Securities..........................................................................53
7.10 Subsidiary Indebtedness........................................................................53
7.11 Restrictions on Subsidiary Dividends...........................................................53
7.12 Independence of Covenants......................................................................53
ARTICLE VIII EVENTS OF DEFAULT..................................................................................54
8.1 Events of Default..............................................................................54
ARTICLE IX AGENT................................................................................................57
9.1 Appointment and Authorization of Agent.........................................................57
9.2 Delegation of Duties...........................................................................58
9.3 Liability of Agent.............................................................................58
9.4 Reliance by Agent..............................................................................59
9.5 Notice of Default..............................................................................59
9.6 Credit Decision; Disclosure of Information by Agent............................................60
9.7 Indemnification of Agent.......................................................................60
9.8 Agent in its Individual Capacity...............................................................61
9.9 Successor Agent................................................................................61
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ARTICLE X MISCELLANEOUS.........................................................................................61
10.1 Notices........................................................................................61
10.2 Right of Set-Off...............................................................................62
10.3 Successors and Assigns.........................................................................62
10.4 No Waiver; Remedies Cumulative.................................................................65
10.5 Payment of Expenses, etc.......................................................................65
10.6 Amendments, Waivers and Consents...............................................................66
10.7 Counterparts...................................................................................66
10.8 Headings.......................................................................................66
10.9 Survival.......................................................................................66
10.10 Calculations; Computations.....................................................................66
10.11 Governing Law; Submission to Jurisdiction; Venue...............................................67
10.12 Severability...................................................................................67
10.13 Entirety.......................................................................................68
10.14 Survival.......................................................................................68
10.15 Pro Rata, Sharing..............................................................................68
10.16 Indemnity......................................................................................68
10.17 Confidentiality................................................................................69
EXHIBITS
Exhibit 1.1(a) Committed Amounts
Exhibit 2.5 Form of Promissory Note
Exhibit 2.6 Existing Letters of Credit
Exhibit 4.1(c) Form of Legal Opinion
Exhibit 5.1(c) Subsidiaries
Exhibit 5.8(a) Contractual Obligations
Exhibit 7.2(d) Existing Investments
Exhibit 10.1 Notice Addresses
Exhibit 10.3(c) Form of Assignment and Acceptance
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SECOND AMENDED, RESTATED AND
MODIFIED LOAN AGREEMENT
THIS SECOND AMENDED, RESTATED AND MODIFIED LOAN AGREEMENT, dated as of
July 16, 2001 (the "Loan Agreement") by and among GENESCO INC., a Tennessee
corporation (the "Borrower"), the Banks (as defined herein) and BANK OF AMERICA,
N.A., formerly known as NationsBank, N.A., a national banking association, as
agent for the Banks (in such capacity, the "Agent").
WHEREAS, the Borrower, certain financial institutions and the Agent
entered into that certain Modified and Restated Loan Agreement dated as of
September 24, 1997 (as amended, restated and modified prior to the date hereof,
the "Existing Loan Agreement");
WHEREAS, the Borrower has requested and the Banks have agreed to amend,
modify and restate the Existing Loan Agreement on the terms and conditions
hereinafter set forth;
WHEREAS, concurrently with the effectiveness of such amendment,
modification and restatement of the Existing Loan Agreement, the Existing Loan
Agreement will be amended, modified and restated in its entirety, the financial
institutions party thereto will have no further obligations thereunder and will
cease to be parties to such agreement and the Borrower (as defined in the
Existing Loan Agreement) will have no further obligations thereunder, except for
those obligations that by their terms survive termination of the Existing Loan
Agreement;
NOW THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged the parties hereto hereby agree to amend, modify and restate the
Existing Loan Agreement in its entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINITIONS.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"Adjusted Eurodollar Rate" means for the Interest Period for
each Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate equal
to the per annum rate obtained by dividing (a) the rate of interest
determined by the Agent to be the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not
such a multiple
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of the per annum rates at which deposits in U.S. dollars are offered to
the Agent in the interbank eurodollar market at 11:00 a.m. (London
time) (or as soon thereafter as is practicable), in each case two
Business Days before the first day of such Interest Period in an amount
substantially equal to such Eurodollar Loan comprising part of such
borrowing (including conversions, extensions and renewals) and for a
period equal to such Interest Period by (b) a percentage equal to 100%
minus the Adjusted Eurodollar Reserve Percentage, if any, for such
Interest Period. As used herein, "Adjusted Eurodollar Rate Reserve
Percentage" for the Interest Period for each Eurodollar Loan comprising
part of the same borrowing (including conversions, extensions and
renewals), means the percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal
reserve requirement) for a member bank of the Federal Reserve System in
New York City with respect to liabilities or assets consisting of or
including eurocurrency liabilities, as such term is defined in
Regulation D (or with respect to any other category of liabilities
which includes deposits by reference to which the interest rate on
Eurodollar Loans is determined) having a term equal to the Interest
Period for which such Adjusted Eurodollar Reserve Percentage is
determined.
"Affiliate" means, with respect to any Person, any other
Person (i) directly or indirectly controlling or controlled by or under
direct or indirect common control with such Person or (ii) directly or
indirectly owning or holding five (5%) or more of the Capital Stock in
such Person. For purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent-Related Persons" means the Agent (including any
successor administrative agent), together with its Affiliates
(including, in the case of Bank of America in its capacity as the
Agent, Banc of America Securities LLC), and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
"Applicable Margin" means, for purposes of calculating the
applicable interest rate for any day for any Loan, the applicable rate
of the Facility Fee for any day or the applicable letter of credit
commission for standby and commercial Letters of Credit for any day,
the appropriate
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applicable percentage corresponding to the Fixed Charge Coverage Ratio
in effect as of the most recent Calculation Date:
APPLICABLE
APPLICABLE APPLICABLE MARGIN FOR APPLICABLE
MARGIN FOR MARGIN FOR APPLICABLE STANBY MARGIN FOR
PRICING FIXED CHARGE EURODOLLAR PRIME RATE FACILITY LETTERS OF COMMERCIAL
LEVEL COVERAGE RATIO LOANS LOANS FEE CREDIT LETTERS OF CREDIT
------- -------------- ---------- ---------- ---------- ---------- -----------------
I => 3.0 to 1.0 0.95% 0.00% 0.35% 0.95% 0.275%
II < 3.0 to 1.0 1.075% .075% 0.425% 1.075% 0.325%
but => 2.25 to
1.0
III < 2.25 to 1.0 1.25% 0.25% 0.50% 1.25% 0.375%
but => 1.75 to
1.0
IV < 1.75 to 1.0 1.425% 0.425% 0.575% 1.425% 0.425%
The Applicable Margin shall be determined and adjusted quarterly on the
date (each a "Calculation Date") five Business Days after the date by
which the Borrower is required to provide the officer's certificate in
accordance with the provisions of Section 6.1(e) for the most recently
ended fiscal quarter of the Borrower, provided, however, that (i) the
initial Applicable Margins shall be based on Pricing Level III (as
shown above) and shall remain at Pricing Level III until the first
Calculation Date subsequent to the Closing Date and, thereafter, the
Pricing Level shall be determined by the Fixed Charge Coverage Ratio as
of the last day of the most recently ended fiscal quarter of the
Borrowers preceding the applicable Calculation Date, and (ii) if the
Borrower fails to provide the officer's certificate to the Agent as
required by Section 6.1(e) for the last day of the most recently ended
fiscal quarter of the Borrower preceding the applicable Calculation
Date, the Applicable Margin from such Calculation Date shall be based
on Pricing Level IV until such time as an appropriate officer's
certificate is provided, whereupon the Pricing Level shall be
determined by the Fixed Charge Coverage Ratio as of the last day of the
most recently ended fiscal quarter of the Borrower preceding such
Calculation Date. Each Applicable Margin shall be effective from one
Calculation Date until the next Calculation Date. Any adjustment in the
Applicable Margins shall be applicable to all existing Loans as well as
any new Loans made or issued.
"Bank" means any of the Persons identified as a "Bank" on the
signature pages hereto, and any Person which may become a Bank by way
of assignment in accordance with the terms hereof, together with their
successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday,
a legal holiday in Charlotte, North Carolina, San Francisco, California
or Nashville, Tennessee or a day on which banking institutions are
authorized by law or other governmental action to close except that in
the case of Eurodollar loans, such day is also a day on which dealings
between banks are carried on in U.S. dollar deposits in the interbank
Eurodollar market.
"Calculation Date" shall have the meaning set forth in the
definition of Applicable Margin.
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"Capital Expenditures" for any period means the aggregate of
all expenditures (including that portion of Capital Leases which is
capitalized on the consolidated balance sheet of the Borrower and its
Subsidiaries, but without duplication in the case of Capital Leases
arising out of a sale-leaseback of property, plant or equipment
previously acquired through Capital Expenditures by the Borrower or its
Subsidiaries) by the Borrower and its Subsidiaries during that period
that, in conformity with GAAP, have been or should have been included
in the property, plant or equipment reflected in the consolidated
balance sheet of the Borrower and its Subsidiaries, other than
additions to property, plant or equipment arising out of the
acquisition of the stock of any Person or of all or substantially all
of the assets of any Person or of any division or business unit of any
Person; provided, however, that such calculation shall exclude up to
$30,000,000 of capital expenditures related to the construction of a
new distribution center.
"Capital Guideline" means any law, rule, regulation, policy,
guideline or directive (whether or not having the force of law and
whether or not the failure to comply therewith would be unlawful, and
including, without limitation, any law, rule, regulation, governmental
policy, guideline or directive contemplated by the report dated July,
1988 entitled "International Convergence of Capital Measurement and
Capital Standards" issued by the Basle Committee on Banking Regulations
and Supervisory Practices): (i) regarding capital adequacy, capital
ratios, capital requirements, the calculation of a bank's capital or
similar matters, or (ii) affecting the amount of capital required to be
obtained or maintained by the Banks or the manner in which the Banks
allocate capital to any of their contingent liabilities (including
letters of credit), advances, commitments, assets or liabilities.
"Capital Lease" as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee
which would, in conformity with GAAP, be required to be accounted for
as a capital lease on the balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or business entity,
any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, (iii) in the case of
a partnership, partnership interests (whether general or limited), (iv)
in the case of a limited liability company, membership interests and
(v) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distribution
of assets of, the issuing Person.
"Change of Control" means (i) directly or indirectly a sale,
transfer or other conveyance of all or substantially all of the assets
of the Borrower, on a consolidated basis, to any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, whether or not applicable), excluding
transfers or conveyances to or among the Borrower's wholly owned
Subsidiaries, as an entirety or substantially as an entirety in one
transaction or series of related transactions,
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in each case with the effect that the ultimate beneficial owners of the
Borrower's Capital Stock having generally the right to vote in an
election of directors immediately prior to the transaction own,
directly or indirectly, in the aggregate, and in the same proportion
with respect to each other, less than 70% of the total voting power
entitled to vote in the election of directors, managers, or trustees of
the transferee entity immediately after such transactions, (ii) any
"person" or "group" (as such terms are used for purposes of Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, whether or not
applicable), is or becomes the "beneficial owner" (as that term is used
in Rules 13d-3 and 13d-5 under the Exchange Act, whether or not
applicable, except that a person shall be deemed to have "beneficial
ownership" of all Capital Stock that any such person has the right to
acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 30% of the
total voting power in the aggregate of all classes of Capital Stock
then outstanding of the Borrower normally entitled to vote in elections
of directors, or (iii) during any period of 24 consecutive months,
individuals who at the beginning of such period constituted the Board
of Directors of the Borrower (together with any new directors whose
election by such Board or whose nomination for election by the
shareholders of the Borrower was approved by a vote of a majority of
the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Borrower then in office.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Commitment" means the commitment by each Bank to make Loans
and share in Letter of Credit Obligations to the Borrower hereunder in
a maximum aggregate principal amount equal to each Bank's Committed
Amount.
"Commitment Percentage" means, for any Bank, the percentage
set forth on Exhibit 1.1(a) attached hereto, as such percentage may be
adjusted in accordance with the terms hereof.
"Committed Amount" means, for each Bank, the amount identified
as its Committed Amount on Exhibit 1.1(a) attached hereto as such
amount may be reduced pro rata based on reductions in the Maximum
Commitment made in accordance with the terms hereof.
"Compliance Certificate" means an Officer's Certificate
demonstrating in such detail as the Agent may reasonably require the
Borrower's compliance with the covenants set forth in Sections 7.2,
7.3, 7.4, 7.5 and 7.10 hereof and delivered to the Banks by the
Borrower pursuant to Section 6.1(c).
"Consolidated Adjusted Debt" means, at any time, the sum of
(i) Consolidated Funded Indebtedness and (ii) the product of
Consolidated Total Operating Lease Expense multiplied by 6.0.
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"Consolidated Current Maturities of Funded Indebtedness" means
for any period, the principal payments required to be made in
accordance with the terms thereof on all Consolidated Funded
Indebtedness of the Borrower and its Subsidiaries on a consolidated
basis during the immediately preceding four fiscal quarters, excluding
principal payments required to be made with regard to any Loan or
Loans.
"Consolidated Depreciation and Amortization" means, for any
period, the depreciation and amortization of the Borrower and its
Subsidiaries on a consolidated basis determined in conformity with
GAAP.
"Consolidated EBITDA" means, with respect to any Person, for
any period, the Consolidated Net Income of such Person for such period
adjusted to exclude (to the extent included therein) (i) Consolidated
Total Income Tax Expense, (ii) Consolidated Depreciation and
Amortization, (iii) Consolidated Total Net Interest Expense and (iv)
other non-cash charges or credits which increased or decreased
Consolidated Net Income, in each case determined for such period on a
consolidated basis for such person and its Subsidiaries in accordance
with GAAP, except as otherwise specifically provided herein.
"Consolidated EBITDAR" means, with respect to any Person, for
any period the sum of Consolidated EBITDA and Consolidated Total
Operating Lease Expense.
"Consolidated EBITR" means for any period, the sum of
Consolidated EBITDA minus Consolidated Depreciation and Amortization
plus Consolidated Total Operating Lease Expense.
"Consolidated Fixed Charge Coverage Ratio" means, as of the
end of any quarterly accounting period for the immediately preceding
four fiscal quarters, the ratio of (i) the sum of Consolidated EBITR to
(ii) the sum of Consolidated Total Net Interest Expense plus
Consolidated Total Operating Lease Expense.
"Consolidated Funded Indebtedness" means, as at any date of
determination, all Indebtedness of any Person that has an original
maturity in excess of one year.
"Consolidated Indebtedness" means, as at any date of
determination, all Indebtedness of the Borrower and its Subsidiaries on
a consolidated basis.
"Consolidated Interest Income" means for any period, aggregate
interest income for the Borrower and its Subsidiaries on a consolidated
basis for such period.
"Consolidated Net Income" means, for any period, the net
earnings (or loss) of the Borrower and its Subsidiaries on a
consolidated basis for such period taken as a single accounting period,
but excluding extraordinary items of gain or loss, all as determined in
conformity with GAAP.
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"Consolidated Net Worth" means, as at any date, the sum of the
capital stock (including nonredeemable preferred stock but subtracting
treasury stock) and additional paid-in capital plus retained earnings
(or minus accumulated deficit) of the Borrower and its Subsidiaries, on
a consolidated basis determined in conformity with GAAP.
"Consolidated Tangible Assets" means, as at any date of
determination, the total assets of the Borrower and its Subsidiaries,
on a consolidated basis determined in accordance with GAAP, minus (i)
intangible assets such as organization costs and franchise costs, (ii)
intangible assets recorded in accordance with Financial Accounting
Standards No. 87, (ii) deferred debits not relating to future tax
benefits and (iv) all good will, trade names, trademarks, patents and
other like intangibles.
"Consolidated Tangible Net Worth" means, as at any date of
determination, Consolidated Net Worth, minus (i) organization costs and
franchise costs, (ii) deferred debits not relating to future tax
benefits and (iii) all good will, trade names, trademarks and patents.
"Consolidated Total Income Tax Expense" means, for any period,
the total income tax expense of the Borrower and its Subsidiaries for
such period, on a consolidated basis determined in accordance with
GAAP.
"Consolidated Total Interest Expense" means, for any period,
total interest expense of the Borrower and its Subsidiaries, on a
consolidated basis determined in accordance with GAAP.
"Consolidated Total Net Interest Expense" means, for any
period, Consolidated Total Interest Expense less Consolidated Interest
Income.
"Consolidated Total Operating Lease Expense" means, for any
period, total rental expense (excluding real estate taxes and other
pass-through expenses) of the Borrower attributable to Operating Leases
to which the Borrower and its Subsidiaries are a party, net of sublease
rentals on a consolidated basis determined in accordance with GAAP for
the immediately preceding fiscal year.
"Contingent Obligation" as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person
with respect to any indebtedness, lease, dividend, letter of credit or
other obligation of another, including, without limitation, any such
obligation directly or indirectly guaranteed, endorsed (otherwise than
for collection or deposit in the ordinary course of business), co-made,
or discounted or sold with recourse by that Person, or in respect of
which that Person is otherwise directly or indirectly liable,
including, without limitation, any such obligation for which that
Person is in effect liable through any agreement (contingent or
otherwise) to purchase, repurchase or otherwise acquire such obligation
or any security therefor, or to provide
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funds for the payment or discharge of such obligation (whether in the
form of loans, advances, stock purchases, capital contributions or
otherwise), or to maintain the solvency or any balance sheet, income or
other financial condition of the obligor of such obligation, or to make
payment for any products, materials or supplies or for any
transportation, services or lease regardless of the non-delivery or
non-furnishing thereof, in any such case if the purpose or intent of
such agreement is to provide assurance that such obligation will be
paid or discharged, or that any agreements relating thereto will be
complied with, or that the holders of such obligation will be protected
(in whole or in part) against loss in respect thereof. The amount of
any Contingent Obligation shall be equal to the amount of the
obligation or portion thereof so guaranteed or otherwise supported.
"Contractual Obligation", as applied to any Person, means any
provision of any Security issued by that Person or of any material
indenture, mortgage, deed of trust, contract, undertaking, agreement or
other instrument to which that Person is a party or by which it or any
of its properties is bound or to which it or any of its properties is
subject.
"Current Assets" means, as at any date of determination, the
total assets of any Person which may properly be classified as current
assets in accordance with GAAP.
"Default" means a condition or event which, after notice or
lapse of time or both, would constitute an Event of Default if that
condition or event were not cured or removed within any applicable
grace or cure period.
"Eligible Assignee" means (a) a Bank; (b) an Affiliate of a
Bank; (c) any entity (whether corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the
ordinary course of its business and is administered or managed by a
Bank or an Affiliate of such Bank, (d) with respect to any Bank which
is a fund which invests in bank loans and similar extensions of credit,
any other fund which invests in bank loans and similar extensions of
credit and is managed by the same investment advisor as such Bank or by
an Affiliate of such investment advisor and (e) any other Person (other
than a natural Person) approved by the Agent and, unless (x) such
Person is taking delivery of an assignment in connection with physical
settlement of a credit derivatives transaction or (y) a Default or an
Event of Default has occurred and is continuing, the Borrower (each
such approval not to be unreasonably withheld or delayed).
"Environmental Laws" shall mean federal, state, local and
foreign laws or regulations, codes, plans, orders, decrees, judgments,
injunctions, notices or demand letters issued, promulgated, approved or
entered thereunder relating to: (i) pollution or protection of the
environment, including, without limitation, laws relating to emissions,
discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances
or wastes ("Regulated Substances") into the environment (including,
without limitation, ambient air, surface water, ground water, land
surface or subsurface strata), (ii) the manufacture, processing,
distribution, use, treatment,
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storage, disposal, transport or handling of pollutants, contaminants,
chemical or industrial wastes or Regulated Substances, and/or (iii)
protection of workers from exposure to Regulated Substances.
"Environmental Laws" shall include, without limitation, the Clean Air
Act, the Clean Water Act, the Resource Conservation and Recovery Act,
the Toxic Substances Control Act, the Comprehensive Environmental
Response, Compensation and Liability Act, the Superfund Amendment and
Reauthorization Act of 1986, the Emergency Planning and Community
Right-to-Know Act and the Occupational Safety and Health Act, each as
amended, and the regulations and interpretations issued thereunder.
"Equity Issuance" means any issuance by the Borrower or any of
its Subsidiaries to any Person of (i) shares of the Capital Stock of
the Borrower or its Subsidiaries, (ii) any shares of the Capital Stock
of the Borrower or its Subsidiaries pursuant to the exercise of options
or warrants or (iii) any shares of the Capital Stock of the Borrower or
its Subsidiaries pursuant to the conversion of any debt securities to
equity.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"ERISA Affiliate", as applied to any Person, means any trade
or business (whether or not incorporated) which is a member of a group
of which that Person is a member and which is a member of a controlled
group of corporations within the meaning of Section 414(b) of the Code
or is under common control within the meaning of Section 414(c) of the
Code.
"Eurodollar Loan" means a Revolving Loan which bears interest
based on the Adjusted Eurodollar Rate.
"Event of Default" has the meaning specified in Article VIII.
"Excess Capital Expenditures Allowance" has the meaning
assigned to that term in Subsection 7.5(d) of this Loan Agreement.
"Existing Loan Agreement" shall have the meaning set forth in
the recitals hereto.
"Facility Fee" means the fee payable pursuant to Section
2.8(b) hereof.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers
on such day, as published by the Federal Reserve Bank on the Business
Day next succeeding such day, provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on
the next succeeding Business Day, and (b) if
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no such rate is so published, on such next succeeding Business Day, the
Federal Funds Rate for such date shall be the average rate quoted to
Bank of America on such date on such transactions as determined by the
Agent.
"Fiscal Year" means the fiscal year of the Borrower ending on
the Saturday closest to January 31 of each year.
"Fund" means any Person (other than a natural Person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of its business.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles
Board, and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards
Board or such other principles as may be approved by a significant
segment of the accounting profession, that are applicable to the
circumstances as of the date of determination, consistently applied. If
at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and
either the Borrower or the Majority Banks shall so request, the Agent,
the Banks and the Borrower shall negotiate in good faith to amend such
ratio or requirement to preserve the original intent thereof in light
of such change in GAAP (subject to the approval of the Majority Banks);
provided that, until so amended, (a) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change
therein and (b) the Borrower shall provide to the Agent and the Banks
financial statements and other documents required under this Loan
Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made
before and after giving effect to such change in GAAP.
"Indebtedness", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with
respect to Capital Leases which is capitalized on a balance sheet in
conformity with GAAP, (iii) notes payable and drafts accepted
representing extensions of credit whether or not representing
obligations for borrowed money, including, without limitation, any
indebtedness evidenced by notes issued pursuant to note agreements or
indentures, (iv) any obligation owed for all or any part of the
deferred purchase price of property or services which purchase price is
(x) due more than six months from the date of incurrence of the
obligation in respect thereof, or (y) evidenced by a note or similar
written instrument, and (v) all indebtedness secured by any mortgage,
pledge, Lien, security interest or vendor's interest under any
conditional sale or other title retention agreement existing on any
property or asset owned or held by that Person regardless of whether
the indebtedness secured thereby shall have been assumed by that Person
or is nonrecourse to the credit of that Person and (vi) the maximum
amount of all letters of credit issued for the account of such Person
and, without duplication, all drafts drawn thereunder or (to the extent
not theretofore reimbursed); provided, however, that Indebtedness shall
not include (i) trade payables and accrued expenses, in each case
arising in the ordinary course of business or (ii) any
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withdrawal liability incurred by the Grief Companies division of the
Borrower to the Amalgamated Pension Fund, a Multiemployer Plan.
"Indemnified Liabilities" has the meaning set forth in Section
10.16.
"Indemnitees" has the meaning set forth in Section 10.16.
"Information" shall have the meaning set forth in Section
10.17.
"Interest Payment Date" means (a) as to Prime Rate Loans, the
last day of each calendar quarter and the Termination Date and (b) as
to Eurodollar Loans, the last day of each Interest Period for such Loan
and the Termination Date, and in addition where the applicable Interest
Period for a Eurodollar Loan is greater than three months, then also
the date three months from the beginning of the Interest Period and
each three months thereafter. If an Interest Payment Date falls on a
date which is not a Business Day, such Interest Payment Date shall be
deemed to be the next succeeding Business Day, except that in the case
of Eurodollar Loans where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business
Day.
"Interest Period" means as to Eurodollar Loans, a period of
one, two, three or six months duration, as the Borrower may elect,
commencing in each case, on the date of the borrowing (including
conversions, extensions and renewals); provided, however, (i) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(ii) no Interest Period shall extend beyond the Termination Date, and
(iii) where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the
Interest Period is to end, such Interest Period shall end on the last
day of such calendar month.
"Investment", as applied to any Person, means any direct or
indirect purchase or other acquisition by that Person of, or a
beneficial interest in, any other Person, whether by the acquisition of
Securities of that Person or otherwise, or any direct or indirect loan,
advance (other than advances to employees for moving and travel
expenses, drawing accounts and similar expenditures in the ordinary
course of business) or capital contribution by that Person to any other
Person, including all indebtedness and accounts receivable from that
other Person, which are not Current Assets or did not arise from sales
or the providing of goods or services in the ordinary course of
business. The amount of any Investment shall be the amount at which
such Investment is carried on the books of the Borrower in accordance
with GAAP.
"Letter of Credit Bank" means the applicable issuer of a
Letter of Credit, which shall be any of the Banks from time to time
selected by the Borrower, by notice to the Agent and the then current
Letter of Credit Bank, with the consent of the Bank selected; provided,
however, only one Bank shall be entitled to issue Letters of Credit at
any time;
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Page 16
provided further, the designation by the Borrower of a new Letter of
Credit of Bank shall relieve the prior Letter of Credit Bank of its
obligation to issue additional Letters of Credit but such prior Letter
of Credit Bank shall continue to be a "Letter of Credit Bank" for
purposes of the Loan Agreement (and shall be entitled to all
corresponding rights and privileges) until all Letter of Credit
Obligations with respect to Letters of Credit it has issued shall have
been fully satisfied.
"Letter of Credit Obligations" means, at any time, the sum of
(a) the maximum amount which is, or at any time thereafter may become,
available to be drawn under Letters of Credit then outstanding plus (b)
the aggregate amount of all drawings under or discounted advances made
with respect to Letters of Credit honored by all Letter of Credit Banks
and not theretofore reimbursed.
"Letters of Credit" shall have the meaning given to such term
in Section 2.6 hereof.
"Lien" means any lien, mortgage, pledge, security interest,
charge or encumbrance, of any kind to secure the payment, performance
or discharge of any liability (as determined in accordance with GAAP)
including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any agreement to give any security
interest.
"Loan" or "Loans" means a Revolving Loan or Revolving Loans,
as appropriate.
"Loan Documents" means this Loan Agreement and the Notes.
"Majority Banks" means, at a particular time, Banks having an
aggregate Commitment Percentage of greater than 50% or if the
Commitments have been terminated, Banks holding greater than 50% of the
then outstanding principal balance of the Revolving Loans.
"Material Adverse Effect" means a material adverse effect on
(i) the business, assets, liabilities, (actual or contingent),
operations, condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole, (ii) the ability of the
Borrower to perform any material obligation under the Loan Documents or
(iii) the material rights and remedies of the Agent and the Banks under
the Loan Documents.
"Maximum Commitment" means Seventy-Five Million Dollars
($75,000,000) as such amount may be reduced in accordance with Section
2.7.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA which is maintained for employees of the
Borrower or any ERISA Affiliate of the Borrower.
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"Notes" means the Revolving Notes.
"Notice of Borrowing" shall have such meaning as provided in
Section 2.2(a).
"Notice of Conversion" shall have such meaning as provided in
Section 3.3.
"Obligations" means all obligations of every nature of the
Borrower from time to time owed to the Banks under this Loan Agreement
and the Notes.
"Officer's Certificate" means a certificate executed on behalf
of the Borrower by a Responsible Officer of the Borrower.
"Operating Lease" means, as applied to any Person, any lease
of any property (whether real, personal or mixed) which is not a
Capital Lease, other than any such lease under which that Person is the
lessor.
"Other Taxes" shall have such meaning as provided in Section
3.7.
"Participant" shall have the meaning set forth in Section
10.3(d).
"Pension Plan" means any employee pension plan which is
subject to the provisions of Title IV of ERISA and which is maintained
for employees of the Borrower or any ERISA Affiliate of the Borrower,
other than a Multiemployer Plan.
"Person" means and includes natural persons, corporations,
limited partnerships, general partnerships, joint stock companies,
joint ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations, whether
or not legal entities, and governments and agencies and political
subdivisions thereof.
"Preferred Stock" means the Borrower's preferred stock, issued
and outstanding as of the date of this Loan Agreement.
"Prime Rate" means, for any day, the rate per annum in effect
for such day as publicly announced from time to time by Bank of America
as its "prime rate." Such rate is a rate set by Bank of America based
upon various factors including Bank of America's costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above,
or below such announced rate. Any change in such rate announced by Bank
of America shall take effect at the opening of business on the day
specified in the public announcement of such change.
"Prime Rate Loan" means a Revolving Loan which bears interest
based on the Prime Rate.
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"Register" shall have the meaning set forth in Section
10.3(c).
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing reserve
requirements.
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any
successor to all or a portion of establishing margin requirements.
"Replacement Bank" shall have the meaning given to such term
in Section 3.11 hereof.
"Responsible Officer" means any of the Senior Vice
President/Chief Financial Officer, Chief Accounting Officer,
Secretary/General Counsel, President or Treasurer.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of the Borrower or any of its Subsidiaries now or hereafter
outstanding, except (A) dividends payable by a Subsidiary of the
Borrower to the Borrower or to another Subsidiary of the Borrower, (B)
dividends payable solely in shares of capital stock of the Borrower,
(C) dividends payable solely through application of the proceeds of a
substantially concurrent sale of shares of capital stock of the
Borrower, and (D) dividends or other distributions of Shareholder
Rights; and (ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect,
of any shares of any class of stock of the Borrower now or hereafter
outstanding, or of any Shareholder Rights, except (A) acquisitions of
shares of capital stock of the Borrower issued under the Borrower's
employee stock plans solely in exchange for the indebtedness of the
trustee under such plans to the Borrower, (B) acquisitions of shares of
capital stock of the Borrower through application of the proceeds of a
substantially concurrent sale of shares of capital stock of the
Borrower, (C) acquisitions of shares of capital stock of the Borrower
in exchange for shares of another class of capital stock of the
Borrower, including any such acquisition in which cash is paid in lieu
of fractional shares, and (D) redemptions, purchases or acquisitions
for value of Shareholder Rights.
"Revolving Loans" means revolving credit loans made pursuant
to Section 2.1.
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"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrower in favor of each Bank evidencing the Revolving
Loans and provided in accordance with Section 2.5, collectively or
individually, as appropriate, as such promissory notes may be amended,
modified, supplemented or replaced from time to time.
"S&P" means Standard & Poor's Rating Services, a division of
the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor or assignee of the
business of such division in the business of rating securities.
"Securities" means any stock, shares, voting trust
certificates, certificates of interest or participation in any
profit-sharing agreement, bonds, debentures, notes or other evidences
of indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as "securities"
or any certificates of interest, shares or participations in temporary
or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Shareholder Right" means a right distributed to holders of
the Borrower's common stock pursuant to a shareholders' rights plan
adopted by the board of directors of the Borrower which (i) grants to
the holder of such right the option to acquire a share of the
Borrower's capital stock on or before a future date, (ii) upon the
acquisition of beneficial ownership by any Person of a specified
percentage of the outstanding shares of a class of the Borrower's
capital stock or of a specified percentage of the voting power of all
of the Borrower's outstanding capital stock, grants to the holder of
such right the option to acquire shares of the Borrower's common stock
and (iii) upon the consummation of a merger, consolidation, share
exchange, sale of assets or other business combination with a Person
who beneficially owns a specified percentage of the outstanding shares
of a class of the Borrower's capital stock or a specified percentage of
the voting power of all of the Borrower's outstanding capital stock,
grants to the holder of such right the right to acquire securities of
such Person.
"Subsidiary" means any corporation, association or other
business entity of which more than 50% of the total voting power of
shares of stock entitled to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more of the other Subsidiaries of
that Person or a combination thereof.
"Taxes" shall have such meaning as provided in Section 3.7.
"Termination Date" means the date July 16, 2004.
"Termination Event" means (i) the withdrawal of the Borrower
or any of its ERISA Affiliates from a Pension Plan during a plan year
in which it was a "substantial employer" as defined in Section
4001(a)(2) of ERISA, or (ii) the filing of a notice of
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intent to terminate a Pension Plan or the treatment of a Pension Plan
amendment as a termination under Section 4041 of ERISA, or (iii) the
institution of proceedings to terminate a Pension Plan by the Pension
Benefit Guaranty Corporation, or (iv) any other event or condition
which might constitute grounds under ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan.
1.2 ACCOUNTING TERMS.
For purposes of this Loan Agreement, all accounting terms not otherwise
defined herein shall have the meanings assigned to them in conformity with GAAP.
1.3 OTHER DEFINITIONAL PROVISIONS.
References to "Articles", "Sections" and "Subsections" shall be to
Articles, Sections and Subsections, respectively, of this Loan Agreement unless
otherwise specifically provided. Any of the terms defined in Section 1.1 may,
unless the context otherwise requires, be used in the singular or the plural
depending on the reference.
ARTICLE II
LOANS
2.1 COMMITMENT.
Subject to and upon the terms and conditions and relying upon the
representations and warranties herein set forth, each Bank severally agrees, at
any time and from time to time from the Closing Date until the Termination Date,
to make revolving credit loans (each a "Revolving Loan" and, collectively,
"Revolving Loans") to the Borrower for the general corporate purposes of the
Borrower; provided, however, the Banks shall not be obligated to make any
Revolving Loan to the extent that immediately after the making of any such
Revolving Loan either the sum of the outstanding principal balance of all
Revolving Loans and Letter of Credit Obligations would exceed the then
applicable Maximum Commitment; provided further, no Bank shall be obligated to
make any Revolving Loan to the extent that immediately after the making of any
such Revolving Loan such Bank's pro rata share (based upon its Commitment
Percentage) of outstanding Revolving Loans and Letter of Credit Obligations
shall exceed such Bank's Committed Amount. Revolving Loans hereunder may consist
of Prime Rate Loans or Eurodollar Loans (or a combination thereof) as the
Borrower may request, and may be repaid and reborrowed in accordance with the
provisions hereof; provided, however, no more than eight (8) Loans may be
outstanding hereunder at any time.
2.2 REVOLVING LOANS ADVANCES.
(a) Notices. Whenever the Borrower desires a Revolving
Loan advance hereunder, it shall give written notice or telephonic
notice (confirmed immediately
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thereafter in writing) (a "Notice of Borrowing") to the Agent not later
than 10:00 a.m. (San Francisco, California time) on the Business Day of
the requested advance in the case of Prime Rate Loans and on the third
Business Day prior to the requested advance in the case of Eurodollar
Loans. Each such notice shall be irrevocable and shall specify (i) that
a Revolving Loan is requested, (ii) the date of the requested advance
(which shall be a Business Day), (iii) the aggregate principal amount
of Revolving Loans requested, and (iv) whether the Revolving Loan
requested shall consist of Prime Rate Loans, Eurodollar Loans or a
combination thereof, and if Eurodollar Loans are requested, the
Interest Periods with respect thereto. If the Borrower shall fail to
specify in any Notice of Borrowing (A) an applicable Interest Period in
the case of a Eurodollar Loan, then such notice shall be deemed to be a
request for an Interest Period of one month or 30 days, respectively,
or (B) the type of Revolving Loan requested, then such notice shall be
deemed to be a request for a Prime Rate Loan hereunder. The Agent shall
as promptly as practicable give each Bank notice of each requested
Revolving Loan advance, of such Bank's pro rata share thereof and of
the other matters covered in the Notice of Borrowing.
(b) Minimum Amounts. The aggregate minimum principal
amount of each Revolving Loan advance hereunder shall be not less than
$1,000,000 (and integral multiples of $1,000,000 in excess thereof).
(c) Advances. Each Bank will make its pro rata share of
each Revolving Loan advance available to the Agent by 12:00 noon (San
Francisco, California time) on the date specified in the Notice of
Borrowing by deposit in U.S. dollars of immediately available funds at
the offices of the Agent in San Francisco, California as provided in
Exhibit 10.1 hereto, or at such other address as the Agent may
designate in writing. All Revolving Loan advances shall be made by the
Banks pro rata on the basis of each Bank's Commitment Percentage. No
Bank shall be responsible for the failure or delay by any other Bank in
its obligation to make Revolving Loan advances hereunder; provided,
however, that the failure of any Bank to fulfill its commitments
hereunder shall not relieve any other Bank of its commitments
hereunder. Unless the Agent shall have been notified by any Bank prior
to the making of any such Revolving Loan advance that such Bank does
not intend to make available to the Agent its portion of the Revolving
Loan advance to be made on such date, the Agent may assume that such
Bank has made such amount available to the Agent on the date of such
Revolving Loan advance, and the Agent, in reliance upon such
assumption, may (in its sole discretion without any obligation to do
so) make available to the Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Borrower, the
Agent shall be entitled to recover such corresponding amount from such
Bank. If such Bank does not pay such corresponding amount forthwith
upon the Agent's demand therefor, the Agent will promptly notify the
Borrower and the Borrower shall immediately pay such corresponding
amount to the Agent. The Agent shall also be entitled to recover from
such Bank or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such
corresponding amount was made available by the Agent to the Borrower to
the date such corresponding amount is recovered by the Agent, at a per
annum rate equal to (i) if paid by such Bank, within two Business Days
of making
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such corresponding amount available to the Borrower, the overnight
Federal Funds Rate, and thereafter the Prime Rate, and (ii) if paid by
the Borrower, the then applicable rate calculated in accordance with
Section 2.4.
2.3 REPAYMENT.
The Revolving Loans hereunder shall be due and payable in full on the
Termination Date.
2.4 INTEREST.
Subject to the provisions of Section 3.1, Revolving Loans shall bear
interest as follows:
(a) Prime Rate Loans. During such periods as Revolving
Loans shall consist of Prime Rate Loans, at a per annum rate equal to
sum of the Prime Rate plus the Applicable Margin.
(b) Eurodollar Loans. During such periods as the
Revolving Loans shall consist of Eurodollar Loans, at a per annum rate
equal to the sum of the Adjusted Eurodollar Rate plus the Applicable
Margin.
(c) Payment of Interest. Interest on Revolving Loans
hereunder shall be payable in arrears on each Interest Payment Date.
2.5 REVOLVING NOTES.
The Revolving Loans by each Bank shall be evidenced by a duly executed
promissory note of the Borrower to each such Bank dated as of the Closing Date
in an original principal amount equal to such Bank's Committed Amount and
substantially in the form of Exhibit 2.5.
2.6 LETTERS OF CREDIT.
(a) Issuance. Subject to the terms and conditions hereof,
each applicable Letter of Credit Bank has issued the Letters of Credit
described on Exhibit 2.6 hereof (which Letters of Credit shall be
deemed issued and outstanding hereunder upon the effectiveness of this
Loan Agreement) and each Letter of Credit Bank will from time to time
issue standby letters of credit and commercial letters of credit from
the Closing Date until the Termination Date as the Borrower may
request, each to be in a form acceptable to the applicable Letter of
Credit Bank (hereinafter the Letters of Credit described on Exhibit 2.6
and the standby letters of credit and commercial letters of credit
issued on and after the Closing Date pursuant to this Section 2.6,
together with all extensions, renewals, modifications and replacements
thereto, shall be referred to as the "Letters of Credit"); provided,
however, that no Letter of Credit Bank shall issue any Letter of Credit
to the extent that immediately after the issuance of such Letter of
Credit the sum of the outstanding principal balance of all Revolving
Loans and Letter of Credit Obligations would exceed the then applicable
Maximum Commitment; provided further, no Letter of
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Credit Bank shall issue any standby Letter of Credit to the extent that
immediately after the issuance of such standby Letter of Credit the
Letter of Credit Obligations relating to all standby Letters of Credit
would exceed $10,000,000; provided further, the Letters of Credit shall
be issued solely for the general corporate purposes of the Borrower. No
Letter of Credit shall have a term of more than one year with the
exception of the Letter of Credit, LC #▇▇▇▇▇▇▇▇, issued by Bank One,
N.A. (formerly known as The First National Bank of Chicago) in the
amount of $327,500.00. No Letter of Credit shall have an expiry date
extending beyond the Termination Date nor shall any Letter of Credit
have payment terms which require the applicable Letter of Credit Bank
to make a payment thereunder after the Termination Date.
(b) Notice. The request for the issuance of a Letter of
Credit shall be submitted to the applicable Letter of Credit Bank and
the Agent at least three Business Days prior to the requested date of
issuance. Upon the request of the applicable Letter of Credit Bank, the
Agent shall furnish such Letter of Credit Bank with all information
regarding the Revolving Loans which is necessary to enable the
applicable Letter of Credit Bank to determine whether such Letter of
Credit Bank is obligated to issue the requested Letter of Credit. Upon
issuance of a Letter of Credit, the Agent shall promptly notify the
Banks of the amount and terms thereof. The applicable Letter of Credit
Bank shall notify the Agent promptly of all payments (whether at
maturity or in advance), reimbursements, expirations, transfers and
other activity with respect to outstanding Letters of Credit. Upon the
request of any Bank, the Agent shall promptly notify such Bank of all
of such payments (whether at maturity or in advance), reimbursements,
expirations, transfers and other activity with respect to outstanding
Letters of Credit.
(c) Participations. Each Bank shall be deemed to have
purchased, without recourse to the applicable Letter of Credit Bank, a
participation from the applicable Letter of Credit Bank in each Letter
of Credit issued or deemed issued hereunder, in each case in an amount
equal to its pro rata share (based upon its Commitment Percentage) of
the amount of such Letter of Credit. Without limiting the scope and
nature of each Bank's participation in any Letter of Credit, to the
extent that the applicable Letter of Credit Bank has not been
reimbursed by the Borrower for any payment required to be made by such
Letter of Credit Bank under any Letter of Credit, each Bank shall pay
to the Agent for payment to such Letter of Credit Bank each Bank's pro
rata share of such unreimbursed drawing in same day funds on the day of
notification by such Letter of Credit Bank of an unreimbursed drawing
pursuant to the provisions of subsection 2.6(d) (or on the next
Business Day if such notification is made after 12:00 noon (San
Francisco, California time)); provided, however, the Banks shall not be
obligated to reimburse the Letter of Credit Bank as provided above to
the extent that such reimbursement obligation has arisen solely on
account of the gross negligence or willful misconduct of such Letter of
Credit Bank, as determined by a court of competent jurisdiction. The
obligation of each Bank to so reimburse each Letter of Credit Bank
shall be absolute and unconditional and shall not be affected by the
occurrence of a Default, an Event of Default or any other occurrence or
event. Any such reimbursement shall not relieve or otherwise impair the
obligation of the Borrower to reimburse each Letter of Credit Bank
under any Letter of Credit, together with interest as hereinafter
provided.
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(d) Reimbursement. In the event of any drawing under any
Letter of Credit and upon the maturity of any draft or acceptance
purchased by a Letter of Credit Bank with respect to any Letter of
Credit, the applicable Letter of Credit Bank will promptly notify the
Borrower and the Agent. Unless the Borrower shall immediately notify
the applicable Letter of Credit Bank of its intent to otherwise
reimburse such Letter of Credit Bank, the Borrower shall be deemed to
have requested a Revolving Loan in the amount of the drawing (or, in
the case of advance purchase by a Letter of Credit Bank, in the amount
of the draft or acceptance), the proceeds of which will be used to
satisfy the reimbursement obligations of the Borrower to the applicable
Letter of Credit Bank in connection with such drawing (or advance
purchase of drafts or acceptances). The Borrower shall reimburse the
applicable Letter of Credit Bank on the day of such drawing under any
Letter of Credit and upon the maturity of any draft or acceptance
purchased by such Letter of Credit Bank with respect to any Letter of
Credit (either with the proceeds of a Revolving Loan obtained hereunder
or otherwise) in same day funds as provided in the Letter of Credit
Application. If the Borrower shall fail to reimburse the applicable
Letter of Credit Bank as provided hereinabove, the unreimbursed amount
of such drawing shall bear interest at a per annum rate equal to the
Prime Rate plus 2%. The Borrower's reimbursement obligations hereunder
shall be absolute and unconditional under all circumstances
irrespective of any rights of set-off, counterclaim or defense to
payment the Borrower may claim or have against any Letter of Credit
Bank, the Agent, the Banks, the beneficiary of any Letter of Credit or
any other Person, including without limitation any defense based on any
failure of the Borrower to receive consideration or the legality,
validity, regularity or unenforceability of the Letter of Credit. The
applicable Letter of Credit Bank will promptly notify the Agent and the
Agent will promptly notify the other Banks of the amount of any
unreimbursed amounts and each Bank will promptly pay such Letter of
Credit Bank for its pro rata share of such unreimbursed amounts as
provided in subsection 2.6(c). As to any draft honored by a Letter of
Credit Bank in other than U.S. currency, the reimbursement obligation
of the Borrower shall be, at the Borrower's option: (i) in United
States currency after application of the appropriate foreign exchange
rate at the time such draft is honored by such Letter of Credit Bank,
or (ii) in immediately available foreign currency funds of the same
tenor as the payment by such Letter of Credit Bank. The Borrower has
the risk of all currency fluctuations. For purposes of this Section
2.6(d), the appropriate foreign exchange rate shall be that rate
established by such Letter of Credit Bank applicable to such foreign
currency on the date such draft is honored.
(e) Amendments. Any extension of the stated expiry date
of any Letter of Credit or increase in the stated amount of any Letter
of Credit shall be made only upon satisfaction of all of the procedures
and conditions for the issuance of a new Letter of Credit of the same
type.
(f) Indemnification; Nature of Such Letter of Credit
Bank's Duties.
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(i) In addition to its other obligations under
this Section 2.6, the Borrower hereby agrees to protect,
indemnify, pay and save each Letter of Credit Bank and each
Bank harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys' fees) that any Letter of
Credit Bank or any Bank may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any
Letter of Credit or (B) the failure of any Letter of Credit
Bank to honor a drawing under a Letter of Credit as a result
of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein
called "Government Acts") or (C) any action of nonaction taken
at the Borrower's request with respect to any Letter of
Credit.
(ii) As between the Borrower on the one hand and
each Letter of Credit Bank and the Banks on the other hand,
the Borrower shall assume all risks of the acts, omissions or
misuse of any Letter of Credit by the beneficiary thereof.
Each Letter of Credit Bank and the Banks shall not be
responsible: (A) for the form, validity, sufficiency,
accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for,
issuance of and drawing under any Letter of Credit, even if it
should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) for the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) for the performance of any
beneficiary of a Letter of Credit of its obligations to the
Borrower or any failure of any such beneficiary to comply
fully with conditions required in order to draw upon a Letter
of Credit; (D) for errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in
cipher; (E) for errors in interpretation of technical terms;
(F) for any loss or delay in the transmission or otherwise of
any document required in order to make a drawing under a
Letter of Credit or of the proceeds thereof; and (G) for any
consequences arising from causes beyond the control of any
Letter of Credit Bank or any Bank, including, without
limitation, any Government Acts. None of the above shall
affect, impair, or prevent the vesting or enforcement of the
Letter of Credit Bank's or any Bank's rights or powers
hereunder.
(iii) In issuing each Letter of Credit, the
applicable Letter of Credit Bank is expressly authorized to
make changes from the terms set forth in the request for such
Letter of Credit as such Letter of Credit Bank, in its sole
discretion, may deem advisable, provided that no such changes
will vary the principal terms thereof. Unless otherwise
expressly agreed by a Letter of Credit Bank and the Borrower
when a Letter of Credit is issued, (i) the rules of the
"International Standby Practices 1998" published by the
Institute of International Banking Law & Practice (or such
later version thereof as may be in effect at the time of
issuance) shall apply to each standby Letter of Credit, and
(ii) the rules of
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the Uniform Customs and Practice for Documentary Credits, as
most recently published by the International Chamber of
Commerce (the "ICC") at the time of issuance (including the
ICC decision published by the Commission on Banking Technique
and Practice on April 6, 1998 regarding the European single
currency (euro)) shall apply to each commercial Letter of
Credit.
(iv) If there is any discrepancy between the
documents accompanying a draft or other demand for payment or
acceptance under a Letter of Credit and the specifications for
such documents in the Borrower's request for such Letter of
Credit or the Letter of Credit, and either (A) the applicable
Letter of Credit Bank delivers electronic, telephonic or other
written notice to the Borrower's principal office of such
discrepancy, and the Borrower does not deliver telephonic or
written instruction to the applicable Letter of Credit Bank's
letter of credit department to dishonor the draft or demand by
noon, local time for the applicable Letter of Credit Bank on
the Business Day after the Business Day on which the
applicable Letter of Credit Bank shall have delivered notice
to the Borrower of the discrepancy, or (B) in the case of a
commercial Letter of Credit, the Borrower has obtained
possession of the goods that are the subject of such Letter of
Credit; then the applicable Letter of Credit Bank may
conclusively presume that the Borrower has waived any
objection to payment or acceptance, as the case may be, based
on such discrepancy, and the applicable Letter of Credit Bank
may, but shall not be obligated to, honor the draft or other
demand under the Letter of Credit (and may honor such draft
after noon on such Business Day, if such Business Day is the
last day to which such Letter of Credit Bank is entitled to
defer honor of such draft under applicable law). In such
event, the Borrower shall be liable to the applicable Letter
of Credit Bank pursuant to subsection 2.6(d) as if the
discrepancy had not been in the documents.
(v) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by any Letter of Credit Bank or
any Bank, under or in connection with any Letter of Credit or
the related documents, if taken or omitted in good faith,
shall not put such Letter of Credit Bank or such Bank under
any resulting liability to the Borrower. It is the intention
of the parties that this Loan Agreement shall be construed and
applied to protect and indemnify each Letter of Credit Bank
and the Banks against any and all risks involved in the
issuance of the Letters of Credit, all of which risks are
hereby assumed by the Borrower, including, without limitation,
any and all risks of the acts or omissions, whether rightful
or wrongful, of any present or future Government Acts. The
Letter of Credit Banks and the Banks shall not, in any way, be
liable for any failure by any Letter of Credit Bank or anyone
else to pay any drawing under any Letter of Credit as a result
of any Government Acts or any other cause beyond the control
of each Letter of Credit Bank.
(vi) Nothing in this subsection (f) is intended
to limit the reimbursement obligation of the Borrower
contained in subsection 2.6(d). The
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obligations of the Borrower under this subsection (f) shall
survive the termination of this Loan Agreement. No act or
omissions of any current or prior beneficiary of a Letter of
Credit shall in any way affect or impair the rights of any
Letter of Credit Bank or any Bank to enforce any right, power
or benefit under this Loan Agreement.
(vii) Notwithstanding anything to the contrary
contained in this subsection (f), the Borrower shall have no
obligation to indemnify any Letter of Credit Bank or any Bank
in respect of any liability incurred by such Letter of Credit
Bank or such Bank arising solely out of the gross negligence
or willful misconduct of the applicable Letter of Credit Bank
or such Bank, as the case may be, as finally determined by a
court of competent jurisdiction.
(g) Limitation on Obligation of each Letter of Credit
Bank. Notwithstanding anything contained herein to the contrary, no
Letter of Credit Bank shall be under any obligation to issue, renew or
extend any Letter of Credit if any order, judgment or decree of any
governmental authority or arbitrator shall by its terms purport to
enjoin or restrain a Letter of Credit Bank from issuing a Letter of
Credit, or any applicable law, rule or regulation or any request or
directive (whether or not having the force of law) from any
governmental authority with jurisdiction over such Letter of Credit
Bank shall prohibit, or request that a Letter of Credit Bank refrain
from, the issuance of letters of credit generally or any such Letter of
Credit in particular, or shall impose upon such Letter of Credit Bank
with respect to any such Letter of Credit any restriction, reserve or
capital requirement (for which such Letter of Credit Bank is not
otherwise compensated hereunder) not in effect on the Closing Date, or
shall impose upon a Letter of Credit Bank any unreimbursed loss, costs
or expense which was not applicable on the Closing Date and which such
Letter of Credit Bank should deem material to it in good faith.
2.7 TERMINATION OF COMMITMENTS.
The Borrower may from time to time permanently terminate the unused
Commitments in whole or in part (in minimum aggregate amounts of $5,000,000),
ratably as to all Banks, upon three Business Days' prior written notice to the
Agent.
2.8 FEES.
(a) Upfront Fee. The Borrower agrees to pay each Bank an
amount equal to 0.375% of the amount of such Bank's Committed Amount.
Such fees shall be due and payable on the date hereof.
(b) Facility Fee. The Borrower shall pay to the Agent for
the account of each Bank a fee for each Bank on such Bank's Committed
Amount at a rate equal to the Applicable Margin. The foregoing
commitment fee shall be paid quarterly in arrears on the last day of
each calendar quarter.
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(c) Standby Letter of Credit Commission. In consideration
of the issuance of standby Letters of Credit hereunder, the Borrower
agrees to pay to the applicable Letter of Credit Bank a letter of
credit commission at a per annum rate equal to the Applicable Margin
for standby Letters of Credit on the maximum amount available to be
drawn under each of the standby Letters of Credit issued by such Letter
of Credit Bank from the date of issuance to the date of expiration. The
foregoing commission shall be shared by the Banks (including the
applicable Letter of Credit Bank in its capacity as a Bank) in
accordance with their respective Commitment Percentages. The foregoing
commission shall be payable in arrears on the last day of each calendar
quarter. In addition to the foregoing, the Borrower agrees to pay a
letter of credit fronting fee to the applicable Letter of Credit Bank
(for its sole account) at a per annum rate equal to 1/8% on the maximum
amount available to be drawn under each of the standby Letters of
Credit issued by such Letter of Credit Bank from the date of issuance.
The foregoing fee shall be payable in advance on the date of issuance
(or extension) of standby Letter of Credit.
(d) Commercial Letter of Credit Commission. In
consideration of the issuance of commercial Letters of Credit
hereunder, the Borrower agrees to pay to the applicable Letter of
Credit Bank, for the ratable benefit of all of the Banks, the following
amounts: (i) a letter of credit commission on the date of each drawing
thereunder equal to the Applicable Margin for commercial Letters of
Credit on the amount of such drawing with respect to the commercial
Letters of Credit issued by such Letter of Credit Bank and (ii) if a
Letter of Credit Bank accepts or purchases any draft with respect to
any Letter of Credit issued by such Letter of Credit Bank, an
acceptance commission equal to 2% per annum on the amount of any such
draft on the date of such acceptance or purchase. The foregoing fees
shall be shared by the Banks (including the applicable Letter of Credit
Bank in its capacity as a Bank) in accordance with their respective
Commitment Percentages and shall be distributed by the applicable
Letter of Credit Bank to the Banks in arrears on the last day of each
calendar quarter.
In addition to the foregoing letter of credit and acceptance
commission, the Borrower will pay to the applicable Letter of Credit
Bank, for its sole use and benefit, such other customary fees of such
Letter of Credit Bank as may be agreed to from time to time by the
Borrower and such Letter of Credit Bank.
(e) Agent's Fee. The Borrower agrees to pay to the Agent
the fees specified in the letter agreement of even date herewith by and
between the Borrower and the Agent, as such agreement may be modified
or supplemented from time to time.
ARTICLE III
ADDITIONAL PROVISIONS REGARDING LOANS
3.1 DEFAULT RATE.
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Upon the occurrence, and during the continuance, of an Event of Default
hereunder, the principal of and, to the extent permitted by law, interest on the
Loans hereunder and any other amounts owing hereunder or under the other Loan
Documents (other than amounts owing under Section 2.6(d) hereof) shall bear
interest, payable on demand, at a per annum rate 2% greater than the rate which
would otherwise be applicable.
3.2 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrower shall have the
right to prepay Loans in whole or in part from time to time without
premium or penalty without prior notice with respect to Prime Rate
Loans and upon one Business Day's prior written notice or telephonic
notice (confirmed immediately thereafter in writing) to the Agent with
respect to all other Loans; provided, however, that each such partial
prepayment shall be a minimum principal amount of $1,000,000; provided
further, the Borrower shall pay all amounts payable under Section 3.6
hereof in connection with any such prepayment. Amounts prepaid on the
Loans may be reborrowed in accordance with the provisions hereof. If
the Borrower shall fail to specify the manner of application,
prepayments shall be applied first to Prime Rate Loans, then to
Eurodollar Loans (taken as a group) in direct order of their Interest
Period maturities.
(b) Mandatory Prepayments.
(i) Commitments. If at any time the sum of the
outstanding principal amount of the
Revolving Loans and the Letter of Credit Obligations shall
exceed the then applicable Maximum Commitment, then the
Borrower shall immediately pay the Agent, for the account of
the Banks, an amount equal to the deficiency. Payments made
hereunder shall be applied first, to the Revolving Loans (and
with respect to the types of Revolving Loans comprising the
Revolving Loans, first to Prime Rate Loans, and then to
Eurodollar Loans in direct order of their Interest Period
maturities), and second, to the Letter of Credit Obligations.
(ii) Clean-Down Payments. The Borrower shall
reduce the outstanding principal balance of the Revolving
Loans to zero for 30 consecutive days during each period
beginning on December 15 of any Fiscal Year and ending on
April 15 of the following Fiscal Year (commencing with the
period beginning December 15, 2001 and ending on April 15,
2002).
3.3 CONVERSION.
The Borrower shall have the option, on any Business Day, to extend
existing Loans into a subsequent Interest Period or to convert Loans into Loans
of another type; provided, however, that (i) except as provided in Section 3.4,
Eurodollar Loans may be converted into Loans of another type only on the last
day of an Interest Period applicable thereto, (ii) Eurodollar Loans may be
extended, and Loans may be converted into Eurodollar Loans, only if no Default
or Event of Default is in existence on the date of extension or conversion,
(iii) Loans extended as, or
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converted into, Eurodollar Loans shall be in such minimum amounts as provided in
Section 2.2(b), and (iv) any request for extension or conversion of a Eurodollar
Loan which shall fail to specify an Interest Period shall be deemed to be a
request for an Interest Period of one month or 30 days, respectively. Each such
extension or conversion shall be effected by the Borrower by giving written
notice (or telephone notice promptly confirmed in writing) to the Agent
(including requests for extensions and renewals, a "Notice of Conversion") prior
to 10:00 a.m. (San Francisco, California time) on the Business Day of, in the
case of existing Prime Rate Loans, and on the third Business Day prior to, in
the case of existing Eurodollar Loans, the date of the proposed extension or
conversion, specifying the date of the proposed extension or conversion, the
Loans to be so extended or converted, the types of Loans into which such Loans
are to be converted and, if appropriate, the applicable Interest Periods with
respect thereto. Each request for extension or conversion shall be deemed to be
a reaffirmation by the Borrower that no Default or Event of Default then exists
and is continuing and that the representations and warranties set forth in
Article V are true and correct in all material respects as of the date of such
Notice of Conversion (except to the extent they relate to an earlier period). In
the event the Borrower fails to request extension or conversion of any
Eurodollar Loan in accordance with this Section, or any such conversion or
extension is not permitted or required by this Section, then such Loans shall be
automatically converted into Prime Rate Loans at the end of their respective
Interest Periods. The Agent shall give each Bank notice as promptly as
practicable of any such proposed conversion affecting any Loans.
3.4 INCREASED COSTS, ILLEGALITY, ETC.
In the event any Bank shall determine (which determination shall be
final and conclusive and binding on all the parties hereto absent manifest
error):
(a) Unavailability. On any date for determining the
appropriate Adjusted Eurodollar Rate for any Interest Period, that by
reason of any changes arising on or after the date of this Loan
Agreement affecting the interbank Eurodollar market, dollar deposits in
the principal amount requested are not generally available in the
interbank Eurodollar market, or adequate, and fair means do not exist
for ascertaining the applicable interest rate on the basis provided for
in the definition of Adjusted Eurodollar Rate; then Eurodollar Loans
will no longer be available, and requests for a Eurodollar Loan shall
be deemed requests for Prime Rate Loans, until such time as such Bank
shall notify the Borrower that the circumstances giving rise thereto no
longer exist.
(b) Increased Costs. At any time, that such Bank shall
incur increased costs or reductions in the amounts received or
receivable hereunder with respect to the making, the commitment to make
or the maintaining of any Eurodollar Loans because of (x) any change
since the date of this Loan Agreement in any applicable law,
governmental rule, regulation, guideline or order (or in the
interpretation or administration thereof and including the introduction
of any new law or governmental rule, regulation, guideline or order)
including without limitation the imposition, modification or deemed
applicability of any reserves, deposits or similar requirements as
related to Eurodollar Loans (such as, for example, but not limited to,
a change in official reserve requirements, but, in all
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events, excluding reserves required under Regulation D to the extent
included in the computation of the Adjusted Eurodollar Rate) and/or (y)
other circumstances affecting such Bank, the interbank Eurodollar
market or the position of such Bank in such market; then the Borrower
shall pay to such Bank promptly upon written demand therefor, such
additional amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Bank may determine
in its sole discretion) as may be required to compensate such Bank for
such increased costs or reductions in amounts receivable hereunder
(written notice as to the additional amounts owed to such Bank, showing
the basis for calculation thereof, shall, absent manifest error, be
final and conclusive and binding on all parties hereto).
(c) Illegality. At any time, that the making or
continuance of any Eurodollar Loan has become unlawful by compliance by
such Bank in good faith with any law, governmental rule, regulation,
guideline or order (or would conflict with any such governmental rule,
regulation, guideline or order not having the force of law even though
the failure to comply therewith would not be unlawful), or has become
impractical as a result of a contingency occurring after the date of
this Loan Agreement which materially and adversely affects the
interbank Eurodollar market; then Eurodollar Loans will no longer be
available, requests for Eurodollar Loans shall be deemed requests for
Prime Rate Loans and the Borrower may, and upon direction of the Bank,
shall, as promptly as possible and, in any event within the time period
required by law, have any such Eurodollar Loans then outstanding
converted into Prime Rate Loans.
3.5 INCREASED COSTS AND REDUCED RETURN.
(a) If the Agent shall have determined that the adoption
or implementation of, or any change in, any law, rule, treaty or
regulation, or any policy, guideline or directive of, or any change in
the interpretation or administration thereof by, any court, central
bank or other administrative or governmental authority, or the
compliance by any Bank or any lending office of any Bank with any
directive of or guideline from any central bank or other governmental
authority or the introduction of or change in any accounting principles
applicable to any Bank or any lending office of any Bank (in each case,
whether or not having the force of law), shall (i) change the basis of
taxation of payments to any Bank or any lending office of any Bank of
any amounts payable hereunder (except for taxes on the overall income
of any Bank or any lending office of any Bank), (ii) impose, modify or
deem applicable any reserve, special deposit or similar requirement
against any Loan or Letter of Credit or against assets of or held by,
or deposits with or for the account of, or credit extended by, any Bank
or any lending office of any Bank, or (iii) impose on any Bank or any
lending office of any Bank any other condition regarding this Loan
Agreement, and the result of any event referred to in clauses (i), (ii)
or (iii) above shall be to increase the cost to any Bank or any lending
office of any Bank of making any Loan, maintaining its Commitment to
make any Loan or participating in any Letter of Credit, or to reduce
any amount received or receivable by any Bank hereunder, then, upon
demand by such Bank, the Borrower shall pay to such Bank such
additional amounts as will compensate such Bank for such increased
costs or reductions in amount,
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together with interest on such additional amounts calculated from the
date such costs or reductions are incurred.
(b) If any Bank shall have determined that any Capital
Guideline or adoption or implementation of, or any change in, any
Capital Guideline by the governmental authority charged with the
interpretation or administration thereof, or compliance by any Bank or
any lending office of such Bank with any Capital Guideline or with any
request or directive of any such governmental authority with respect to
any Capital Guideline, or the implementation of, or any change in, any
applicable accounting principles (in each case, whether or not having
the force of law), either (i) affects or would affect the amount of
capital required or expected to be maintained by any Bank or any
lending office of such Bank, and such Bank determines that the amount
of such capital is increased as a direct or indirect consequence of any
Loans or Letters of Credit made or maintained or any Commitment to make
Revolving Loans or to participate in Letters of Credit, or such Bank's
or such lending office's other obligations hereunder, or (ii) has or
would have the effect of reducing the rate of return on such Bank's or
such lending office's capital to a level below that which such Bank
could have achieved but for such circumstances as a consequence of any
Loans made or maintained, or the Commitment to make Revolving Loans,
such Bank's or such lending office's other obligations hereunder (in
each case, taking into consideration the Bank's or such lending
office's policies with respect to capital adequacy), then, upon demand
by such Bank, the Borrower shall pay to such Bank from time to time
such additional amounts as will compensate such Bank for such cost of
maintaining such increased capital or such reduction in the rate of
return on the such Bank's or such lending office's capital.
(c) Upon determining in good faith than any additional
amounts will be payable pursuant to this Section, any Bank will give
prompt written notice thereof to the Borrower, which notice shall set
forth the basis of the calculation of such additional amounts, although
the failure to give any such notice shall not release or diminish any
of the Borrower's obligations to pay additional amounts pursuant to
this Section; provided, however, the Borrower shall not be obligated to
pay any of such amounts to any such Bank until it receives the
applicable notice from such Bank. Determination by any Bank of amounts
owing under this Section shall, absent manifest error, be final and
conclusive and binding on the parties hereto. Failure on the part of
any Bank to demand compensation for any period hereunder shall not
constitute a waiver of such Bank's rights to demand any such
compensation in such period or in any other period.
(d) The Borrower will reimburse each Letter of Credit
Bank on demand for all charges and expenses made or incurred by such
Letter of Credit Bank in connection with each Letter of Credit issued
by such Letter of Credit Bank including any increased expense to such
Letter of Credit Bank resulting from the application of any tax (other
than income tax), reserve requirement or deposit insurance premiums;
the amount of such charges and expenses to be determined by such Letter
of Credit Bank in good faith.
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(e) All amounts payable under this Section 3.5 shall bear
interest from the date that is three Business Days after the date of
demand by any Bank until payment in full to such Bank at a per annum
rate equal to the Prime Rate plus 2%.
3.6 COMPENSATION.
The Borrower shall compensate each Bank, upon its written request
(which request shall set forth the basis for requesting such compensation), for
all reasonable losses, expenses and liabilities (including, without limitation,
any loss, expense or liability incurred by reason of the liquidation or
reemployment of deposits or other funds required by such Bank to fund its
Eurodollar Loans) which such Bank may sustain:
(a) if for any reason (other than a default by such Bank
or the Agent) a borrowing of Eurodollar Loans does not occur on a date
specified therefor in a Notice of Borrowing or Notice of Conversion;
(b) if any repayment or conversion of any Eurodollar Loan
occurs on a date which is not the last day of an Interest Period
applicable thereto;
(c) if any prepayment of any Eurodollar Loan is not made
on any date specified in a notice of prepayment given by the Borrower;
or
(d) as a consequence of any other default by the Borrower
to repay its Loans or any Letter of Credit Obligations when required by
the terms of this Loan Agreement.
Calculation of all amounts payable to a Bank under this Section shall be made as
though such Bank has actually funded its relevant Eurodollar Loan through the
purchase of a Eurodollar deposit bearing interest at the Eurodollar Rate in an
amount equal to the amount of that Loan, having a maturity comparable to the
relevant Interest Period and in the case of Eurodollar Loans, through the
transfer of such Eurodollar deposit from an offshore office of that Bank to a
domestic office of that Bank in the United States of America; provided, however,
that each Bank may fund each of its Eurodollar Loans in any manner it sees fit
and the foregoing assumption shall be utilized only for the calculation of
amounts payable under this Section.
3.7 TAXES.
(a) All payments made by the Borrower hereunder, under
the Notes or under any Loan Document will be made without setoff,
counterclaim, deduction or other defense. All such payments shall be
made free and clear of and without deduction for any present or future
income, franchise, sales, use, excise, stamp or other taxes, levies,
imposts, deductions, charges, fees, withholdings, restrictions or
conditions of any nature now or hereafter imposed, levied, collected,
withheld or assessed by any jurisdiction (whether pursuant to United
States Federal, state, local or foreign law) or by any political
subdivision or taxing authority thereof or therein, and all interest,
penalties or similar liabilities, excluding taxes on the overall income
of a Bank or any lending office of such Bank, (such nonexcluded taxes
are hereinafter collectively referred to as the "Taxes"). If
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the Borrower shall be required by law to deduct or to withhold any
Taxes from or in respect of any amount payable hereunder, (i) the
amount so payable shall be increased to the extent necessary so that
after making all required deductions and withholdings (including Taxes
on amounts payable to the Banks pursuant to this sentence) the Banks
receive an amount equal to the sum they would have received had no such
deductions or withholdings been made, (ii) the Borrower shall make such
deductions or withholdings, and (iii) the Borrower shall pay the full
amount deducted or withheld to the relevant taxation authority in
accordance with applicable law; provided, however, if any Bank
subsequently recovers any of such deductions or withholdings, such Bank
shall promptly refund to the Borrower the amount of such deductions or
withholdings. Whenever any Taxes are payable by the Borrower, as
promptly as possible thereafter, the Borrower shall send the Banks and
the Agent an official receipt showing payment. In addition, the
Borrower agrees to pay any present or future taxes, charges or similar
levies which arise from any payment made hereunder or from the
execution, delivery, performance, recordation or filing of, or
otherwise with respect to, this Loan Agreement, the Notes or any other
Loan Document (hereinafter referred to as "Other Taxes").
(b) The Borrower will indemnify the Banks for the amount
of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this
Section 3.7) paid by any Bank and any liability (including penalties,
interest and expenses for nonpayment, late payment or otherwise)
whether or not such Taxes or Other Taxes were correctly or legally
asserted. This indemnification shall be paid within 30 days from the
date on which such Bank makes written demand; provided, however, the
Borrower shall have the right to contest any such Taxes before any
appropriate administrative agency or court of competent jurisdiction so
long as such Bank is not adversely affected by any such contest, as
reasonably determined by such Bank.
(c) Each Bank which is a foreign person (i.e., a Person
other than a United States Person for United States Federal income tax
purposes) hereby agrees that:
(i) it shall, no later than the Closing Date
(or, in the case of a Bank which becomes a party hereto
pursuant to Section 10.3(b) hereof after the Closing Date, the
date upon which such Bank becomes a party hereto) deliver to
the Borrower through the Agent:
(A) two accurate and complete signed
originals of Internal Revenue Service Form W-8BEN, or
(B) two accurate and complete signed
originals of Internal Revenue Service Form W-8ECI,
in each case indicating that such Bank is on the date of
delivery thereof entitled to receive payments of principal,
interest and fees for the account of such lending office or
offices under this Loan Agreement free from withholding of
United States Federal income tax;
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(ii) if at any time such Bank changes its lending
office or offices or selects an additional lending office, it
shall, at the same time or reasonably promptly thereafter,
deliver to the Borrower through the Agent in replacement for,
or in addition to, the forms previously delivered by it
hereunder;
(A) if such changed or additional
lending office is located in the United States, two
accurate and complete signed originals of Internal
Revenue Service Form W-8BEN, or
(B) otherwise, two accurate and
complete signed originals of Internal Revenue Service
Form W-8ECI,
in each case indicating that such Bank is on the date of
delivery thereof entitled to receive payments of principal,
interest and fees for the account of such changed or
additional lending office under this Loan Agreement free from
withholding of United States federal income tax; and
(iii) it shall, promptly upon the Borrower's
reasonable request to that effect, deliver to the Borrower
such other forms or similar documentation as may be required
from time to time by any applicable law, treaty, rule or
regulation in order to establish such Bank's tax status for
withholding purposes.
(d) If the Borrower fails to perform its obligations
under this Section 3.7, the Borrower shall indemnify the Banks for any
incremental taxes, interest or penalties that may become payable as a
result of any such failure.
3.8 CHANGE OF LENDING OFFICE.
Each Bank agrees that, upon the occurrence of any event giving rise to
the operation of Section 3.4(b) or (c) or 3.7, it will, if requested by the
Borrower, use reasonable efforts (subject to overall policy considerations of
such Bank) to designate another lending office for any Loans affected by such
event, provided that such designation is made on such terms that such Bank and
its lending office suffer no disadvantage (including, without limitation, no
economic, legal or regulatory disadvantage), with the object of avoiding the
consequence of the event giving rise to the operation of any such Section.
Nothing in this Section shall affect or postpone any of the obligations of the
Borrower or the right of any Bank provided in Sections 3.4, 3.5, or 3.7.
3.9 LATE PAYMENT FEE.
Should any principal installment payment be in default for more than 15
days, there may be imposed, to the extent permitted by law, a delinquency charge
not to exceed 2% of such installment in default. In addition, at the Majority
Banks' option, any overdue interest, fees and charges may, for purposes of
computing and accruing interest, be deemed to be a part of the
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corresponding principal Obligation and interest shall accrue on a daily
compounded basis after such date (at the applicable rate, including any default
rate under Section 3.1) thereon.
3.10 PAYMENTS AND COMPUTATIONS.
Except as otherwise specifically provided herein, all payments
hereunder shall be made to the Agent in U.S. dollars in immediately available
funds at its offices in at the address set forth in Exhibit 10.1 hereto not
later than 10:00 a.m. (San Francisco, California time) on the date when due,
without set-off or counterclaim. Payments received after such time shall be
deemed to have been received on the next succeeding Business Day. The Agent will
thereafter cause to be distributed promptly like funds relating to the payment
of principal or interest or fees ratably to the Banks entitled to receive such
payments in accordance with the terms of this Loan Agreement. Whenever any
payment hereunder shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be extended to the next succeeding Business Day
(subject to accrual of interest and fees for the period of such extension),
except that in the case of Eurodollar Loans, if the extension would cause the
payment to be made in the next following calendar month, then such payment shall
instead be made on the next preceding Business Day. All computations of interest
and fees shall be made on the basis of actual number of days elapsed over a year
of 360 days (except for the calculations in respect of interest at the Bank of
America prime rate, which shall be based on the actual number of days elapsed
over a year of 365/366 days). Interest shall accrue from and include the date of
such Loan, but exclude the date of payment.
3.11 REPLACEMENT OR REMOVAL OF BANK.
In the event that the Agent receives one or more notices claiming
compensation, reimbursement or indemnity (each, a "Compensation Notice")
pursuant to the provisions of Sections 3.4, 3.5 or 3.7 and the aggregate amount
of all such compensation, reimbursement or indemnity payments made or required
to be made by the Borrower to such Bank pursuant to Sections 3.4, 3.5 or 3.7 is
materially greater (as determined by the Borrower in its reasonable judgment)
than the weighted average amount of payments made or required to be made to the
other Banks pursuant to Sections 3.4, 3.5 or 3.7, then, so long as no Default or
Event of Default shall have occurred and be continuing, the Borrower may, within
60 days after receipt of any such Compensation Notice, elect to terminate such
Bank as a party to this Loan Agreement. If any Bank to be terminated has a
Commitment which, together with the amount of any Commitment or Commitments
theretofore or concurrently therewith to be reduced in accordance with this
Section 3.11, aggregates 30% or less of the aggregate Commitments, the Borrower
may elect either to replace such Bank with another financial institution
reasonably satisfactory to the Agent (a "Replacement Bank") or to reduce the
Commitments by the amount of the Commitment of such Bank. If any Bank to be
terminated has a Commitment which, together with the amount of any Commitment or
Commitments theretofore or concurrently therewith to be reduced in accordance
with this Section 3.11, aggregates in excess of 30% of the aggregate
Commitments, the Borrower may elect to terminate such Bank only if, together
with its notice of termination, it provides to the Agent a commitment from a
Replacement Bank to replace the Commitment of the terminated Bank under this
Loan Agreement on the terms and conditions set forth herein.
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The Borrower's election to terminate a Bank under this Section 3.11 shall be set
forth in a written notice from the Borrower to the Agent (with a copy to such
Bank), setting forth (i) the basis for termination of such Bank, (ii) whether
the Borrower intends to replace such Bank with a Replacement Bank or (if the
Borrower is not required to replace such Bank) to reduce the Commitments by the
amount of the Commitment of such Bank, and (iii) the date (not later than 30
days after the date of such notice) when such termination shall become effective
(the "Termination Effective Date"). On the Termination Effective Date, (x) the
Borrower and/or the Replacement Bank, as applicable, shall pay the terminated
Bank an amount equal to all principal, interest, fees and other amounts owed to
such Bank (including, without limitation, any amounts owed under Sections 3.4,
3.5 or 3.7), through the date on which such termination becomes effective, and
(y) there shall have been received by the Agent all documents and supporting
materials necessary, in the reasonable judgment of the Agent to evidence the
substitution of the Replacement Bank for such Bank or, if there is no
Replacement Bank, to reflect the adjustment of the Commitments, including,
without limitation, any necessary or appropriate adjustments to the Commitment
Percentages, such adjustments to the Committed Percentage of any remaining Bank
to be based upon the percentage of such Bank's Committed Amount to the aggregate
Committed Amounts of all of the remaining Banks.
3.12 ADVANCES.
(i) No Bank shall be responsible for the failure or delay
by any other Bank in its obligation to make its ratable share of a
borrowing hereunder; provided, however, that the failure of any Bank to
fulfill its obligations hereunder shall not relieve any other Bank of
its obligations hereunder.
(ii) Unless the Borrower or any Bank has notified the
Agent prior to the date any payment is required to be made by it to the
Agent hereunder, that the Borrower or such Bank, as the case may be,
will not make such payment, the Agent may assume that the Borrower or
such Bank, as the case may be, has timely made such payment and may
(but shall not be so required to), in reliance thereon, make available
a corresponding amount to the Person entitled thereto. If and to the
extent that such payment was not in fact made to the Agent in
immediately available funds, then:
(A) if the Borrower failed to make such
payment, each Bank shall forthwith on demand repay to
the Agent the portion of such assumed payment that
was made available to such Bank in immediately
available funds, together with interest thereon in
respect of each day from and including the date such
amount was made available by the Agent to such Bank
to the date such amount is repaid to the Agent in
immediately available funds, at the Federal Funds
Rate from time to time in effect; and
(B) if any Bank failed to make such
payment, such Bank shall forthwith on demand pay to
the Agent the amount thereof in immediately available
funds, together with interest thereon for the period
from the date such amount was made available by the
Agent to the Borrower to the date
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such amount is recovered by the Agent (the
"Compensation Period") at a rate per annum equal to
the Federal Funds Rate from time to time in effect.
If such Bank does not pay such amount forthwith upon
the Agent's demand therefor, the Agent may make a
demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Agent, together with
interest thereon for the Compensation Period at a
rate per annum equal to the rate of interest
applicable to the applicable borrowing.
Nothing herein shall be deemed to relieve any Bank from its
obligation to fulfill its Commitment or to prejudice any
rights that the Agent or the Borrower may have against any
Bank as a result of any default by such Bank hereunder. A
notice of the Agent to any Bank with respect to any amount
owing under this subsection (ii) shall be conclusive, absent
manifest error.
ARTICLE IV
CONDITIONS PRECEDENT TO ALL LOANS
AND ISSUANCE OF LETTERS OF CREDIT
4.1 CONDITIONS TO INITIAL LOANS AND LETTERS OF CREDIT.
The obligations of the Banks to make the initial Loans hereunder and
the obligation of the applicable Letter of Credit Bank to issue the initial
Letters of Credit hereunder are subject, at the time of the making of such
initial Loans or issuance of such initial Letters of Credit to the satisfaction
of the following conditions (in form and substance acceptable to the Agent):
(a) Executed Loan Documents. Receipt by the Agent of
executed copies of this Loan Agreement and the other Loan Documents and
(in sufficient numbers to provide a fully executed original of each,
except for the Notes, for each Bank).
(b) No Default; Representations and Warranties. The Agent
shall have received a certificate or certificates executed by a
Responsible Officer of the Borrower as of the Closing Date, in form and
substance satisfactory to the Agent, stating that (A) all governmental,
shareholder and third party consents and approvals, if any, with
respect to the Loan Documents and the transactions contemplated thereby
have been obtained, (B) there is no action, suit, proceeding or
arbitration (whether or not purportedly on behalf of the Borrower or
any of its Subsidiaries) at law or in equity or before or by any
federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, pending
or to the knowledge of the Borrower threatened against or affecting the
Borrower or any of its Subsidiaries or any of their respective
properties which would reasonably be expected to have a Material
Adverse Effect, and (C) immediately after giving effect to the initial
borrowings and issuances of Letters of Credit hereunder, (1) no Default
or Event of Default exists, and (2) all representations and warranties
contained herein and in the other Loan Documents are true and correct
in all material respects.
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(c) Opinion of Counsel. Receipt by the Agent of an
opinion, or opinions, in form and substance satisfactory to the Banks,
addressed to the Banks and dated as of the Closing Date from counsel to
the Borrower, which shall cover the matters contained in Exhibit 4.1(c)
hereto (in sufficient numbers to provide a fully executed original to
each Bank).
(d) Corporate Documents. Receipt by the Agent of the
following:
(i) Charter Documents. Copies of the charter
documents (as amended) of the Borrower certified to be true
and complete as of a recent date by the appropriate
governmental authority of the state of its incorporation.
(ii) Resolutions. Copies of resolutions of the
Board of Directors of the Borrower approving and adopting the
Loan Documents, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a
secretary or assistant secretary as of the date of this Loan
Agreement to be true and correct and in force and effect as of
such date.
(iii) Bylaws. A copy of the bylaws of the Borrower
certified by a secretary or assistant secretary as of the date
of this Loan Agreement to be true and correct and in force and
effect as of such date.
(iv) Good Standing. Copies of certificates of
good standing, existence or its equivalent with respect to the
Borrower certified as of a recent date by the appropriate
governmental authorities of the state of incorporation.
(e) Fees. Any fees required to be paid on or before the
Closing Date shall have been paid.
(f) Termination of Existing Loan Agreement. Evidence that
the Existing Loan Agreement has been or concurrently with the Closing
Date is being terminated.
(g) Other. Receipt by the Agent of such other assurances,
certificates, documents, consents or opinions as the Agent, a Letter of
Credit Bank or the Majority Banks reasonably may require.
4.2 CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT.
The obligations of each Bank to make, convert or extend any Loan and of
a Letter of Credit Bank to issue or extend any Letter of Credit (including the
initial Loans and the initial Letters of Credit) are subject to satisfaction of
the following conditions in addition to satisfaction on the Closing Date of the
conditions set forth in Section 4.1:
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(a) The Borrower shall have delivered (i) in the case of
any Loan an appropriate Notice of Borrowing pursuant to Section 2.2(a)
or Notice of Conversion or (ii) in the case of any Letter of Credit,
the applicable Letter of Credit Bank shall have received a letter of
credit application in form and substance acceptable to such Letter of
Credit Bank;
(b) The representations and warranties set forth in
Article V shall, subject to the limitations set forth therein, be true
and correct in all material respects as of such date (except for those
which expressly relate to an earlier date);
(c) There shall not have been commenced against the
Borrower or any of its Subsidiaries an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or any case, proceeding or other action for the appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its
Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed;
(d) No Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto; and
(e) Immediately after giving effect to the making of such
Loan, in the case of a request for a Loan, (and the application of the
proceeds thereof) or to the issuance of such Letter of Credit, as the
case may be, (i) the sum of the outstanding principal amount of all
Revolving Loans and Letter of Credit Obligations shall not exceed the
then applicable Maximum Commitment.
The delivery of each Notice of Borrowing and each Letter of Credit
Application pursuant to Section 2.2(a) or Section 2.6(a), as applicable
shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c), (d) and
(e) above.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower hereby represents and warrants to the Agent and the Banks
that:
5.1 ORGANIZATION AND POWER; QUALIFICATION; GOOD STANDING;
SUBSIDIARIES.
(a) Organization and Power. The Borrower and each of its
Subsidiaries are corporations duly organized, validly existing and in
good standing under the laws of their respective jurisdictions of
incorporation and have all requisite corporate power and authority to
own and operate their respective properties and to carry on their
respective
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business as now conducted and proposed to be conducted. The Borrower
has all requisite corporate power and authority to enter into this Loan
Agreement and the Loan Documents and to perform its obligations
hereunder and thereunder.
(b) Qualification; Good Standing. The Borrower is duly
licensed or qualified as a foreign corporation authorized to transact
business and is in good standing in each jurisdiction in which the
character of the properties owned by it or the nature of the business
transacted by it makes such licensing or qualification necessary.
(c) Subsidiaries. As of the Closing Date, the Borrower
has no Subsidiaries other than as identified in Exhibit 5.1(c) hereto.
The capital stock of each of the Borrower's Subsidiaries is duly
authorized, validly issued and fully paid and nonassessable. Each of
the Borrower's Subsidiaries is validly existing and in good standing
under the laws of its respective jurisdiction of incorporation and is
duly licensed or qualified as a foreign corporation authorized to
transact business and is in good standing in each jurisdiction in which
the character of the properties owned by it or the nature of the
business transacted by it makes such licensing or qualification
necessary. Each of the Borrower's Subsidiaries has full corporate power
and authority to own its assets and properties, and to operate its
business as presently owned and conducted. Exhibit 5.1(c) correctly
sets forth the ownership interest of the Borrower in each of its
Subsidiaries as of the Closing Date.
5.2 AUTHORIZATION OF BORROWING; NO CONFLICTS; BINDING OBLIGATIONS;
ETC.
(a) Authorization of Borrowing. The execution, delivery
and performance by the Borrower of this Loan Agreement and the
issuance, delivery and payment of the Notes have been duly authorized
by all necessary corporate action by the Borrower.
(b) No Conflicts. The execution, delivery and performance
by the Borrower of this Loan Agreement and the issuance, delivery and
payment of the Notes do not and will not (i) violate any provision of
law applicable to the Borrower, the Restated Charter (as amended) or
Bylaws of the Borrower or the Charter or Certificate or Articles of
Incorporation or Articles of Association or Bylaws or Memoranda of
Association of any Subsidiary of the Borrower, or any order, judgment
or decree of any court or other agencies of government binding on the
Borrower or any of its Subsidiaries, (ii) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a
default under any Contractual Obligation of the Borrower or any of its
Subsidiaries, (iii) result in or require the creation or imposition of
any Lien, charge or encumbrance of any nature whatsoever upon any of
the properties or assets of the Borrower or any of its Subsidiaries or
(iv) require any approval of stockholders or any approval or consent of
any Person under any Contractual Obligation of the Borrower or any of
its Subsidiaries.
(c) Governmental Consents. The execution, delivery and
performance by the Borrower of this Loan Agreement, and the issuance,
delivery and performance of the Notes, do not and will not require any
registration with, consent or approval of, or notice
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to, or other action to, with or by, any federal, state or other
governmental authority or regulatory body or other Person.
(d) Binding Obligation. This Loan Agreement is, and the
Notes when executed and delivered hereunder will be, the legally valid
and binding obligations of the Borrower, enforceable against the
Borrower in accordance with their respective terms, except as
enforcement may be limited by bankruptcy, insolvency or other similar
laws affecting the enforcement of creditors' rights generally and
equitable remedies.
5.3 FINANCIAL CONDITION; NO CHANGES.
(a) Financial Statements. The Borrower has heretofore
delivered to the Banks the audited consolidated financial statements of
the Borrower and its Subsidiaries for the Fiscal Years 2001 and 2000,
consisting of the Borrower's consolidated balance sheets as at such
dates and the related consolidated statements of earnings, of cash
flows and shareholders equity for the Fiscal Years then ended. Such
statements were prepared in accordance with GAAP and fairly present in
all material respects the consolidated financial position of the
Borrower and its Subsidiaries as at the date thereof.
(b) Contingent Obligations. As of the Closing Date,
neither the Borrower nor any of its Subsidiaries has any material
Contingent Obligation which is not reflected in the financial
statements delivered pursuant to Subsection 5.3(a) or in the notes
thereto or otherwise permitted by Section 7.3.
(c) No Material Adverse Effect. Since February 3, 2001,
there has been no development or event relating to or affecting the
Borrower or its Subsidiaries, taken as a whole, which has had or could
reasonably be expected to have a Material Adverse Effect.
(d) Restricted Payments. Since February 3, 2001, the
Borrower has not directly or indirectly declared, ordered, paid or made
or set apart any sum of money or any property for any Restricted
Payment or agreed to do so, except for the regular quarterly dividends
on the Borrower's Preferred Stock permitted pursuant to Section 7.4(b).
5.4 TITLE TO PROPERTIES; LIENS.
The Borrower and its Subsidiaries have good and legal title to all
properties and assets, real and personal, tangible and intangible, reflected in
the consolidated balance sheet of the Borrower as at February 3, 2001 referred
to in Subsection 5.3(a) except for assets acquired or disposed of either in the
ordinary course of business since the date of such consolidated balance sheet or
as otherwise permitted by this Loan Agreement. All such properties and assets
are free and clear of Liens, except as permitted under Section 7.1.
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5.5 LITIGATION.
Except as set forth in the notes to the Borrower's financial statements
for the Fiscal Year 2001, there is no action, suit, proceeding or arbitration
(whether or not purportedly on behalf of the Borrower or any of its
Subsidiaries) at law or in equity or before or by any federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, pending or to the knowledge of the
Borrower threatened against or affecting the Borrower or any of its Subsidiaries
or any of their respective properties which would reasonably be expected to have
a Material Adverse Effect.
5.6 COMPLIANCE WITH LAW.
Neither the Borrower nor any of its Subsidiaries is (i) in violation of
any applicable law which would reasonably be expected to have a Material Adverse
Effect or (ii) subject to or in default with respect to any final judgment,
writ, injunction, decree, rule or regulation of any court or federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which would reasonably be expected to have
a Material Adverse Effect.
5.7 PAYMENT OF TAXES.
As of the Closing Date, the Borrower and its Subsidiaries have filed
all federal tax returns and all other tax returns that, to the best knowledge of
the Borrower's officers, after due inquiry, are required to be filed by any of
them, and have paid all taxes, assessments, fees and other governmental charges
upon the Borrower and its Subsidiaries and upon their respective properties and
assets (real and personal, tangible and intangible), income and franchises which
are due and payable in accordance with such returns, except to the extent
permitted by Section 6.3. As of the Closing Date, the charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or governmental charges are, in the opinion of the Borrower, adequate and
the Borrower does not know of any proposed tax assessment against it or any of
its Subsidiaries that would reasonably be expected to have a Material Adverse
Effect.
5.8 CONTRACTUAL OBLIGATIONS: PERFORMANCE.
(a) Contractual Obligations.. Except as set forth in
Exhibit 5.8(a) hereto, as of the Closing Date neither the Borrower nor
any of its Subsidiaries is a party to or is subject to any Contractual
Obligation (other than Contractual Obligations entered into in the
ordinary course of business of the Borrower and its Subsidiaries or as
otherwise permitted by this Loan Agreement) that is material to the
Borrower and its Subsidiaries, taken as a whole. None of such
Contractual Obligations in existence as of the Closing Date will
materially adversely affect the ability of the Borrower to perform its
Obligations.
(b) Performance. Neither the Borrower nor any of its
Subsidiaries is in default in the performance, observance or
fulfillment of any of the obligations, covenants or
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conditions contained in any Contractual Obligation of the Borrower and
any of its Subsidiaries and no condition exists which, with the giving
of notice or the lapse of time or both, would constitute such a
default, except where the consequences, direct or indirect, of such
default or defaults, if any, would not reasonably be expected to have a
Material Adverse Effect.
5.9 ENVIRONMENTAL PROTECTION.
As of the Closing Date, the Borrower and each of its Subsidiaries has
obtained all material permits, licenses and other authorizations that are
required with respect to the operation of its business under any Environmental
Law; the Borrower and each of its Subsidiaries is in compliance with all terms
and conditions of the required permits, licenses and authorizations, and is also
in compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
the Environmental Laws, except to the extent that the failure to comply
therewith would not reasonably be expected to have a Material Adverse Effect,
there is no civil, criminal or administrative action, suit, demand, claim,
hearing, notice of violation, investigation, proceeding, notice or demand letter
pending or threatened against the Borrower or any of its Subsidiaries relating
in any way to the Environmental Laws which would reasonably be expected to have
a Material Adverse Effect; and there are no past or present (or, to the best of
the Borrower's knowledge, future) events, conditions, circumstances, activities,
practices, incidents, actions or plans which may interfere with or prevent
compliance or continued compliance with the Environmental Laws, or which may
give rise to any common law or other legal liability, including, without
limitation, liability under the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, or any similar state, local or
foreign laws, or otherwise form the basis of any claim, action, demand, suit,
proceeding, hearing, notice of violation, study or investigation, based on or
related to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling, or the emission, discharge, release or
threatened release into the environment, of any pollutant, contaminant, chemical
or industrial, toxic or hazardous substance or waste, except to the extent that
such non-compliance or liability would not reasonably be expected to have a
Material Adverse Effect.
5.10 EMPLOYEE BENEFIT PLANS.
The Borrower and each of its Subsidiaries and each of their respective
ERISA Affiliates is in compliance in all material respects with any applicable
provisions of the Code and ERISA and the regulations and published
interpretations thereunder with respect to all Pension Plans and Multiemployer
Plans. As of the Closing Date, no Termination Event has occurred or is
reasonably expected to occur with respect to any Pension Plan and neither the
Borrower, any of its Subsidiaries nor any of their respective ERISA Affiliates
has incurred or reasonably expects to incur any withdrawal liability under ERISA
to any Multiemployer Plan, other than the withdrawal liability of the Grief
Compliance to the ACTWU Pension Fund.
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5.11 CERTAIN FEES.
No broker's or finder's fee or commission will be payable by or on
behalf of the Borrower with respect to this Loan Agreement or the transactions
contemplated hereby, and the Borrower hereby indemnifies the Banks against and
agrees that it will hold the Banks harmless from any claim, demand or liability
for broker's or finder's fees alleged to have been incurred by the Borrower in
connection with this Loan Agreement or the transactions contemplated hereby.
5.12 DEFAULTS.
No Event of Default or Default exists under this Loan Agreement.
5.13 DISCLOSURE.
As of the Closing Date, there is no fact known to the Borrower which
would reasonably be expected to have a Material Adverse Effect, which has not
been disclosed herein or in such other documents, certificates and statements
furnished to the Banks for use in connection with the transactions contemplated
hereby.
5.14 MARGIN STOCK.
None of such Loans or Letters of Credit will be used for the purpose of
purchasing or carrying any "margin stock" as defined in Regulations U or
Regulation X, or for the purpose of reducing or retiring any Indebtedness which
was originally incurred to purchase or carry "margin stock" or for any other
purpose which might constitute this transaction a "purpose credit" within the
meaning of Regulation U or Regulation X.
ARTICLE VI
AFFIRMATIVE COVENANTS
The Borrower hereby covenants and agrees that so long as this Loan
Agreement is in effect and until the Loans and Letter of Credit Obligations,
together with interest, fees and all other Obligations hereunder, have been paid
in full and the Commitments hereunder shall have terminated:
6.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
The Borrower will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements of the
Borrower in accordance with GAAP. The Borrower will deliver to each of the
Banks:
(a) as soon as practicable and in any event within 60
days after the end of each fiscal quarter in each of the Borrower's
Fiscal Years, other than the fourth
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fiscal quarter, an unaudited consolidated balance sheet and income and
cash flow statements of the Borrower and its Subsidiaries as at the end
of such period and for the year-to-date period then ended, but in any
event setting forth, in comparative form, the consolidated figures for
the corresponding periods of the previous Fiscal Year and the
consolidated figures included in the operating plan delivered to the
Banks pursuant to Section 6.1(1), all in reasonable detail;
(b) as soon as practicable and in any event within 100
days after the end of each Fiscal Year of the Borrower, a consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of
such Fiscal Year and the related consolidated statements of earnings,
of cash flows and of shareholders equity of the Borrower and its
Subsidiaries for such Fiscal Year, setting forth in comparative form
the consolidated figures for the previous Fiscal Year, all in
reasonable detail and accompanied by an opinion thereon of a firm of
independent public accountants of recognized national standing selected
by the Borrower, which opinion shall not be subject to a "going
concern" or similar qualification, to the effect that such consolidated
financial statements have been prepared in accordance with GAAP and
present fairly the financial condition of the Borrower reported on and
that the examination of such accountants in connection with such
financial statements has been made in accordance with generally
accepted auditing standards and, accordingly, includes such tests of
the accounting records and such other auditing procedures as were
considered necessary in the circumstances;
(c) together with each delivery of financial statements
of the Borrower and its Subsidiaries pursuant to paragraph (b) and (c)
above, a statement signed by a Responsible Officer of the Borrower to
the effect that no Event of Default or Default exists, and that such
financial statements present fairly the financial position of the
Borrower and its Subsidiaries and the results of their operations for
the period covered thereby, and together with each delivery of
financial statements of the Borrower and its Subsidiaries pursuant to
paragraphs (b) and (c) above, a Compliance Certificate demonstrating in
reasonable detail compliance during and at the end of such accounting
periods with the restrictions contained in Sections 7.2, 7.3, 7.4, 7.5
and 7.10;
(d) together with each delivery of financial statements
of the Borrower and its Subsidiaries pursuant to paragraph (c) above, a
certificate of the accountants addressed to the Agent and the Banks who
rendered the opinion with respect to such financial statements, stating
that they have read this Loan Agreement and stating further whether, in
making their audit, such accountants have become aware of any Event of
Default or Default under any of the terms or provisions of Sections
7.4, 7.5 and 7.10 of this Loan Agreement insofar as any such terms or
provisions pertain to or involve accounting matters or determinations,
and if any such condition or event then exists, specifying the nature
thereof;
(e) within 60 days after the end of each fiscal quarter
of each fiscal year, a statement signed by a Responsible Officer of the
Borrower setting forth the Fixed Charge
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Coverage Ratio as at the end of each such fiscal quarter and setting
forth that no Event of Default or Default exists;
(f) promptly upon receipt thereof, copies of all reports
submitted to the Borrower by independent public accountants in
connection with each annual, interim or special audit of the financial
statements of the Borrower made by such accountants, including, without
limitation, any report to the audit committee of the Borrower's board
of directors on internal controls or other similar reports submitted by
such accountants in connection with their annual audit;
(g) promptly upon their becoming available, copies of all
financial statements, reports, notices and proxy statements sent or
made available generally by the Borrower to its security holders or by
any Subsidiary of the Borrower to its security holders other than the
Borrower or another Subsidiary, of all regular and periodic reports and
all registration statements and prospectuses, if any, filed by the
Borrower or any of its Subsidiaries with any securities exchange or
with the Securities and Exchange Commission or any governmental
authority succeeding to any of its functions, and of all press releases
and other statements made available generally by the Borrower or any
Subsidiary to the public concerning material developments in the
business of the Borrower and its Subsidiaries;
(h) promptly upon becoming aware (i) of any condition or
event which constitutes an Event of Default or Default, or that any
Bank or the Agent has given any notice or taken any other action with
respect to a claimed Event of Default or Default under this Loan
Agreement, (ii) that any Person has given any notice to the Borrower or
any Subsidiary of the Borrower or taken any other action with respect
to a claimed default or event or condition of the type referred to in
Section 8.1(a), (iii) of the institution of any litigation involving an
alleged liability of the Borrower or any of its Subsidiaries equal to
or greater than $10,000,000, individually or in the aggregate for all
such litigation, or any adverse determination in any litigation
involving a potential liability of the Borrower or any of its
Subsidiaries equal to or greater than $3,500,000, individually or in
the aggregate for all related litigation, (iv) that any civil, criminal
or administrative action, suit, demand, claim, hearing, notice of
violation, investigation or proceeding is pending or threatened against
the Borrower or any of its Subsidiaries, including, without limitation,
with respect to any Environmental Laws, involving potential liability,
penalties or sanctions (including, without limitation, estimated
cleanup costs), equal to or greater than $10,000,000, individually or
in the aggregate, or any adverse determination in any of the foregoing
involving potential liability of the Borrower or any of its
Subsidiaries equal to or greater than $3,500,000, individually or in
the aggregate, (v) of any condition or event which would be required to
be disclosed in a current report filed by the Borrower with the
Securities and Exchange Commission on Form 8-K (Items 1, 2, 4 and 5 of
such Form as in effect on the date hereof) if the Borrower were
required to file such reports under the Securities Exchange Act of
1934, as amended from time to time, and any successor statute, or (vi)
of any condition or event that would reasonably be expected to have a
Material Adverse Effect, an Officer's Certificate specifying the nature
and period of existence of any such condition or event, or specifying
the notice given or action taken
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by such Person and the nature of such claimed default, Event of
Default, Default, event or condition, and what action the Borrower has
taken, is taking and proposes to take with respect thereto;
(i) promptly upon becoming aware of the occurrence of any
(i) Termination Event, or (ii) non-exempt "prohibited transaction," as
such term is defined in Section 4975 of the Code, in connection with
any Pension Plan or any trust created thereunder, a written notice
specifying the nature thereof, what action the Borrower has taken, is
taking or proposes to take with respect thereto, and, when known, any
action taken or threatened by the Internal Revenue Service, the United
States Department of Labor or the Pension Benefit Guaranty Corporation
with respect thereto;
(j) with reasonable promptness, copies of (i) all notices
received by the Borrower or any of its ERISA Affiliates of the Pension
Benefit Guaranty Corporation's intent to terminate any Pension Plan or
to have a trustee appointed to administer any Pension Plan; (ii) all
notices received by the Borrower or any of its ERISA Affiliates from a
Multiemployer Plan sponsor concerning the imposition or amount of
withdrawal liability pursuant to Section 4202 of ERISA; (iii) any
application for the waiver or extension of the minimum funding
requirements of the Code or ERISA; (iv) any notice of the failure of
any Pension Plan to meet the minimum funding standards which is
required under Section 101(d) of ERISA; and (v) any notice of the
intent to terminate any Pension Plan which is required under Section
4041(2) of ERISA;
(k) as soon as practicable and in any event within ninety
(90) days after the beginning of each Fiscal Year, the consolidated
balance sheets, income statements and cash flow statements included in
the Borrower's operating plan for such Fiscal Year, on a monthly basis;
(l) with reasonable promptness, notice of the date the
Borrower has complied with the provisions of Section 3.2(b)(ii) with
respect to any applicable 45 day period thereunder;
(m) within 15 days of the end of each calendar month, a
report detailing each Letter of Credit outstanding hereunder including
the amount and beneficiary thereof, such report to be in form and
substance satisfactory to the Agent; and
(n) with reasonable promptness, such other information
and data with respect to the Borrower or any of its Subsidiaries as
from time to time may be reasonably requested by any Bank.
6.2 CORPORATE EXISTENCE, ETC.
The Borrower will at all times preserve and keep in full force and
effect its corporate existence and rights and franchises material to its
business and, except as permitted under Section 7.6, those of each of its
Subsidiaries; provided, that the Borrower shall not be required to
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preserve and keep in full force and effect the corporate existence of any
Subsidiary of the Borrower or any right or franchise if the Borrower reasonably
determines that the preservation thereof is no longer desirable in the conduct
of the business of the Borrower or any Subsidiary of the Borrower and that the
loss thereof would not reasonably be expected to have a Material Adverse Effect.
6.3 PAYMENT OF TAXES AND CLAIMS.
The Borrower will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets (real and personal, tangible and intangible) or in respect
of any of its franchises, business, income or property, and all claims
(including, without limitation, claims for labor, services, materials and
supplies) for sums which have become due and payable and which by law have or
may become a Lien upon any of its properties or assets (real and personal,
tangible and intangible); provided, that no such charge or claim need be paid if
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted and if such reserves or other appropriate provision, if
any, as shall be required in conformity with GAAP shall have been made therefor.
6.4 MAINTENANCE OF PROPERTIES; INSURANCE.
The Borrower will maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or owned or leased in the business of the Borrower and its
Subsidiaries and from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof unless disposed of in the ordinary
course of business of the Borrower and its Subsidiaries or as otherwise
permitted by this Loan Agreement. The Borrower will maintain or cause to be
maintained, with financially sound and reputable insurers, insurance with
respect to its properties and business and the properties and business of its
Subsidiaries against loss or damage of the kinds customarily insured against by
business entities of established reputation engaged in the same or similar
businesses and similarly situated, of such types and in such amounts as are
customarily carried under similar circumstances by such other business entities;
provided, that the Borrower may maintain reasonable self-insurance (including
reasonable deductibles or similar loss or retained risk thresholds).
6.5 INSPECTION.
The Borrower will permit any authorized representatives designated by
any Bank to visit and inspect any of the properties of the Borrower or any of
its Subsidiaries, including its and their financial and accounting records, and
to make copies and take extracts therefrom, and to discuss its and their
affairs, finances and accounts with its and their officers, all upon reasonable
notice and at such reasonable times during normal business hours and as often as
may be reasonably requested.
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6.6 COMPLIANCE WITH LAWS, ETC.
The Borrower and its Subsidiaries shall comply with the requirements of
all applicable laws, rules, regulations and orders of any governmental
authority, including, without limitation, all Environmental Laws, noncompliance
with which would be reasonably expected to have a Material Adverse Effect.
6.7 PARI PASSU.
All the payment obligations of the Borrower arising under or pursuant
to the Loan Documents will at all times rank pari passu with all other unsecured
and unsubordinated payment obligations and liabilities (including contingent
obligations and liabilities) of the Borrower (other than those which are
mandatorily preferred by laws or regulations of general application).
ARTICLE VII
NEGATIVE COVENANTS
The Borrower hereby covenants and agrees that so long as this Loan
Agreement is in effect and until the Loans and Letter of Credit Obligations,
together with interest, fees and all other Obligations hereunder, have been paid
in full and the Commitments hereunder shall have terminated:
7.1 LIENS.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or permit to exist any Lien on or
with respect to any property or asset of the Borrower or any of its
Subsidiaries, whether now owned or hereafter acquired, or any income or profits
therefrom, except:
(a) Liens for taxes, assessments or governmental charges
or claims the payment of which is not at the time required by Section
6.3;
(b) Statutory Liens of landlords and Liens of carriers,
warehouses, mechanics, materialmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent
or being contested in good faith, if such reserves or other appropriate
provision, if any, as shall be required by GAAP shall have been made
therefor, and deposits made to obtain the release of such Liens;
(c) Liens (other than any Lien imposed by ERISA) incurred
or deposits made in the ordinary course of business in connection with
worker's compensation, unemployment insurance and other types of social
security, or to secure the performance
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of tenders, statutory obligations, surety, stay, appeal or customs
bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(d) Any attachment or judgment Lien not constituting an
Event of Default pursuant to Section 8.1 hereof;
(e) Liens of mortgages or pledges by Subsidiaries of the
Borrower of all or part of their assets as security for Indebtedness
owing by them to the Borrower or to another Subsidiary of the Borrower;
(f) The pledge by the Borrower or any Subsidiary of the
Borrower of documents representing merchandise being exported to any
place outside the continental limits of the United States of America in
connection with the discount or sale of foreign drafts or in connection
with other similar methods of financing such export shipments;
(g) Liens on supplies or materials of the Borrower or any
Subsidiary of the Borrower to secure advances from the United States
Government or from any agency or instrumentality thereof in connection
with any contract with such government, agency or instrumentality for
the manufacture of such supplies or materials, to which the Borrower or
any Subsidiary of the Borrower is a party, directly or indirectly;
(h) Capital Leases and Operating Leases, and all liens,
rights of reverter and other possessory rights of the lessors
thereunder;
(i) Zoning restrictions, easements, rights-of-way or
other restrictions on the use of real property, and minor
irregularities in the title thereto; and any other Liens and
encumbrances similar to those described in this paragraph (i) that were
not incurred in connection with the borrowing of money or the obtaining
of advances or credits; provided, that all of the foregoing do not in
the aggregate materially detract from the value of the property of the
Borrower and its Subsidiaries or materially impair the use thereof in
the operation of their respective businesses or the marketability
thereof;
(j) Purchase money security interests granted in
connection with the acquisition of fixed assets, provided, that the
acquisition thereof is permitted by Subsection 7.5(d) and such Liens
attach only to the property acquired thereby;
(k) (i) Liens on accounts receivable which have been sold
by the Borrower pursuant to that certain Foreign Accounts
Receivable Factoring Agreement, dated October 13, 1999, by and
between the Borrower and Suntrust Bank, Atlanta Factoring
Division (the "Factoring Agreement") provided that (A) the
liabilities and obligations incurred by the Borrower under the
Factoring Agreement (including contingent liabilities and
obligations) shall not exceed $2,000,000 in the aggregate at
any time outstanding and (B) the Liens granted by the Borrower
pursuant to the Factoring Agreement shall only be on the
accounts
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receivable sold pursuant to the Factoring Agreement and shall
not extend to any other assets of the Borrower or any of its
Subsidiaries; and
(ii) Liens on accounts receivable which have been
sold or discounted by the Borrower by means of a
securitization for purposes of securing the obligations
incurred by the Borrower in connection with such sale provided
that (A) the outstanding amount of accounts receivable so sold
or discounted by the Borrower in the aggregate at any time
shall not exceed 50% of the face amount of all such
receivables, (B) the accounts receivable so sold or discounted
are substantially similar in credit quality to the accounts
receivable retained by the Borrower and (C) the proceeds of
such sales shall be used to prepay the Obligations and
permanently reduce the Committed Amounts; and
(l) Liens securing obligations under commercial letters
of credit issued to enable the Borrower or any of its Subsidiaries to
acquire inventory, provided that such Liens are limited to the
inventory being acquired.
7.2 INVESTMENTS.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, except:
(a) The Borrower and its Subsidiaries may make and own
Investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by
any agency thereof and 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, (ii) marketable direct obligations
issued by any state of the United States of America or any political
subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof and, at
the time of acquisition, having the highest rating obtainable from
either S&P or ▇▇▇▇▇'▇, (iii) commercial paper maturing no more than one
year from the date of creation thereof and, at the time of acquisition,
having a rating in one of the two highest rating categories of S&P or
▇▇▇▇▇'▇, (iv) certificates of deposit, bankers acceptances or time
deposits maturing within one year from the date of acquisition thereof
issued by any of the Banks or any Affiliate of any of the Banks, (v)
certificates of deposit or bankers, acceptances maturing within one
year from the date of acquisition thereof or time deposits maturing
within 30 days from the date of acquisition thereof issued by other
commercial banks organized under the laws of the United States of
America or any state thereof or the District of Columbia, each having
shareholders' equity of not less than $125,000,000, or other commercial
banks organized under the laws of a foreign country, each having
shareholders, equity of not less than $500,000,000; (vi) repurchase
agreements with commercial banks or with securities dealers, in any
case fully secured as to principal and interest by obligations
described in clauses (i)-(v) of this paragraph (a),
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and (vii) money market funds given the highest rating by S&P or ▇▇▇▇▇'▇
and with assets of not less than $500,000,000;
(b) The Borrower may make and own Investments consisting
of advances, loans, extensions of credit to or purchases of Securities
of, or other Investments in, its Subsidiaries, and the Borrower's
Subsidiaries may make and own Investments consisting of advances,
loans, extensions of credit or purchases of Securities of, or other
investments in, the Borrower and Subsidiaries of the Borrower;
(c) The Borrower and its Subsidiaries may make and own
loans or advances to the trustee of various employee incentive and
stock purchase plans of the Borrower, not to exceed $19,000,000 in the
aggregate at any one time outstanding;
(d) The Borrower and its Subsidiaries may continue to own
the existing Investments set forth on Exhibit 7.2(d);
(e) The Borrower may make Investments in auction
preferred equity securities that offer the Borrower a corporate
dividend deduction, provided that the aggregate amount of such
Investments during the term of this Loan Agreement does not exceed
$5,000,000; and
(f) The Borrower and its Subsidiaries may make and own
other Investments (including, but not limited to acquisitions of stock
or assets of another Person) not to exceed in the aggregate at any time
outstanding 10% of Consolidated Tangible Net Worth.
7.3 CONTINGENT OBLIGATIONS.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or become or be liable with respect to any
Contingent Obligation, including, without limitation Contingent Obligations of
the Borrower or any Subsidiary of the Borrower with respect to any other
Subsidiary of the Borrower, except:
(a) The Borrower may remain liable with respect to
Contingent Obligations arising under trade letters of credit or
Contingent Obligations reflected as a liability on the Borrower's
consolidated balance sheet (other than Indebtedness of the Borrower's
Subsidiaries);
(b) The Borrower may become or remain liable with respect
to guaranties of the obligations of Subsidiaries with respect to
Operating Leases, employment agreements and indebtedness for borrowed
money;
(c) The Borrower may become and remain liable with
respect to guaranties of its Subsidiaries' trade payables and accrued
liabilities incurred in the ordinary course of business;
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(d) The Borrower may become and remain liable with
respect to stock purchase notes owing to the trustee of various
employee incentive and stock purchase plans of the Borrower by
participants in such plans; provided, that any payments by the Borrower
with respect to such notes are repaid to the Borrower by such trustee
in reduction of loans or advances owing by him to the Borrower;
(e) The Borrower and Subsidiaries may become and remain
liable with respect to Contingent Obligations arising out of
assignments by the Borrower and Subsidiaries of Capital Leases and
Operating Leases;
(f) The Borrower and any Subsidiary may become and remain
liable with respect to Contingent Obligations arising out of (i) the
indemnification of directors, officers, employees and agents to the
extent permissible under the Tennessee Business Corporation Act or the
corporation law of the jurisdiction in which such Subsidiary is
incorporated or organized, (ii) the indemnification of investment
bankers, commercial banks and other independent consultants or
professional advisors pursuant to agreements relating to the
underwriting of the Borrower's or such Subsidiary's securities or the
rendering of banking or professional services for the Borrower or such
Subsidiary, and (iii) the indemnification of landlords, lessors,
licensors, licensees and other parties pursuant to agreements entered
into in the ordinary course of business by the Borrower or such
Subsidiary;
(g) The Borrower may become and remain liable with
respect to guaranties of or letters of credit supporting Indebtedness
of Subsidiaries (including, without limitation, Capital Leases) and
other Contingent Obligations not to exceed in aggregate amount at any
time outstanding 10% of Consolidated Tangible Net Worth (exclusive of
any foreign currency fluctuations); and
(h) The Borrower may incur customary and reasonable
indemnity obligations in connection with the sale of assets permitted
by Section 7.6 hereof.
7.4 RESTRICTED PAYMENTS.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Payment; provided, that, so long as no Event of Default or Default
has occurred and is continuing or would occur as a result of such action:
(a) The Borrower may make Restricted Payments if the
cumulative amount of all such Restricted Payments (including any
Restricted Payment proposed to be made) after the Closing Date would
not exceed the sum of (i) $13,000,000.00; plus (ii) 50%, if positive,
or minus 100%, if negative, of cumulative Consolidated Net Income after
August 4, 2001 to the end of the accounting month immediately preceding
the date of the action by the board of directors of the Borrower
declaring or authorizing the Restricted
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Payment, taken as a single period; plus (iii) 50% of the cumulative net
cash proceeds of the issuance of new equity Securities by the Borrower,
other than proceeds applied for the purposes described in clauses
(i)(C) and (ii)(B) of the definition of Restricted Payment;
(b) The Borrower may make Restricted Payments with
respect to the Borrower's Preferred Stock; and
(c) The Borrower may make Restricted Payments described
in clause (ii)(D) of the definition of Restricted Payments at a price
not to exceed $.05 per Shareholder Right or $2,000,000 in the aggregate
for all such Shareholder Rights.
7.5 FINANCIAL COVENANTS.
(a) Consolidated Tangible Net Worth. The Borrower will
maintain Consolidated Tangible Net Worth of at least $120,000,000 as of
the end of any quarterly or annual accounting period; provided,
however, such required amount shall be increased on the last day of
each fiscal quarter beginning with the fiscal quarter ending on August
4, 2001 by an amount equal to 50% of positive Consolidated Net Income
for the applicable fiscal quarter then ending, such increases to be
cumulative; provided further, such required amount shall be further
increased by the amount of net proceeds (including any increase in
stockholders equity resulting from the conversion of debt securities of
the Borrower to equity securities) of the Borrower received by the
Borrower on account of any Equity Issuance, any such increase to be
effective as of the date of receipt by the Borrower of such proceeds.
(b) Consolidated Fixed Charge Coverage Ratio. The
Borrower will maintain as of the last day of each fiscal quarter, a
Consolidated Fixed Charge Coverage Ratio of not less than 1.55 to 1.0.
(c) Maximum Consolidated Adjusted Debt to EBITDAR. The
Borrower will maintain as of the last day of each fiscal quarter a
ratio of (i) Consolidated Indebtedness to (ii) Consolidated EBITDAR
less than 4.0 to 1.0.
(d) Capital Expenditures. The Borrower will not, and will
not permit any of its Subsidiaries to, purchase or otherwise acquire,
or commit to purchase or otherwise acquire, any fixed or capital asset
or otherwise make or incur obligations for Capital Expenditures by the
expenditure of cash or the incurrence of Indebtedness, the cost of
which (or, in the case of any acquisition not in the nature of an
ordinary purchase, the book value of the consideration given for
which), when aggregated with the costs of all other such assets
purchased or otherwise acquired by the Borrower and its Subsidiaries
taken as a whole during such Fiscal Year, would exceed the amounts set
forth below for the applicable Fiscal Year:
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Fiscal Year Amount
----------- -----------
2002 $36,000,000
2003 $38,000,000
2004 $39,000,000
provided, that, if during any Fiscal Year Capital Expenditures are less
than the amount set forth above for such Fiscal Year, the lesser of (i)
the difference between the amount set forth above for such Fiscal Year
and the actual Capital Expenditures for such Fiscal Year, or (ii)
$3,000,000 (such lesser amount being referred to as the "Excess Capital
Expenditures Allowance") shall be carried forward so as to increase the
maximum Capital Expenditures which may be made in accordance with this
Subsection 7.5(d) for the immediately succeeding Fiscal Year, but not
for any other subsequent Fiscal Year, except to the extent permitted by
the next succeeding sentence. Capital Expenditures made in any such
succeeding Fiscal Year shall be applied first to the Excess Capital
Expenditures Allowance carried forward until such Allowance is
exhausted and shall then be applied to the maximum Capital Expenditures
specified above for such Fiscal Year in determining whether an Excess
Capital Expenditure Allowance is available to be carried forward to the
next succeeding Fiscal Year in the manner described in this Subsection
7.5(d).
7.6 RESTRICTIONS ON FUNDAMENTAL CHANGES.
The Borrower will not, and will not permit any of its Subsidiaries to
(i) enter into any transaction of merger or consolidation, or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution), or (ii) convey,
sell, lease, transfer or otherwise dispose of subsequent to the Closing Date, in
one or more transactions, all or any portion of its business, properties or
assets (real and personal, tangible and intangible) or any stock or other
Securities of any of its Subsidiaries, whether now owned or hereafter acquired,
constituting in the aggregate for all of such transactions consummated on or
after the end of the second fiscal quarter of Fiscal Year 2001 more than 10% of
Consolidated Tangible Assets as of the end of the second fiscal quarter of
Fiscal Year 2001; provided, that, so long as no Event of Default or Default has
occurred and is continuing or would occur as a result thereof, (x) any
Subsidiary of the Borrower may be merged or consolidated with or into the
Borrower or any direct wholly-owned Subsidiary of the Borrower, or be
liquidated, wound up or dissolved, or all or substantially all of its business,
properties or assets (real and personal, tangible and intangible) may be
conveyed, sold, leased, transferred or otherwise disposed of, in one transaction
or a series of transactions, to the Borrower or any direct wholly-owned
Subsidiary of the Borrower; and (y) the Borrower or any of its Subsidiaries may
acquire any Person by merger or consolidation, provided that the Borrower or
such Subsidiary is the corporation surviving such merger or consolidation, in
any transaction that would not cause an Event of Default or Default under this
Loan Agreement.
7.7 ERISA.
The Borrower will not, and will not permit any of its ERISA Affiliates
to:
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(a) engage in any transaction in connection with which
the Borrower or any of its ERISA Affiliates could be subject to either
a civil penalty assessed pursuant to Section 502(i) of ERISA or a tax
imposed by Section 4975 of the Code in either case in an amount in any
Fiscal Year greater than $1,000,000;
(b) fail to make full payment when due of all amounts
which, under the provisions of any Pension Plan or applicable law, the
Borrower or any of its ERISA Affiliates is required to pay as
contributions thereto, or permit to exist any accumulated funding
deficiency with respect to any Pension Plan with respect to any plan
year; or
(c) fail to make any payment to any Multiemployer Plan
that the Borrower or any of its ERISA Affiliates may be required to
make under any agreement relating to such Multiemployer Plan, or any
law pertaining thereto.
As used in this Section 7.7, the term "accumulated funding deficiency" has the
meaning specified in Section 302 of ERISA and Section 412 of the Code.
7.8 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction
(including, without limitation, the purchase, sale, lease or exchange of any
property or the rendering of any service) with any holder of 5% or more of the
voting power of the Borrower's capital stock, or with any Affiliate of the
Borrower or of any such holder, on terms that are materially less favorable to
the Borrower or that Subsidiary, as the case may be, than those which would be
obtained at the time from Persons who are not such a holder or an Affiliate;
provided, that the foregoing restriction shall not apply to any transaction
between the Borrower and any of its wholly-owned Subsidiaries or between any of
its wholly-owned Subsidiaries.
7.9 SUBSIDIARY SECURITIES.
The Borrower will not, directly or indirectly, sell, assign, pledge or
otherwise encumber or dispose of any shares or other Securities of any of its
Subsidiaries, or permit any of its Subsidiaries, directly or indirectly, to
sell, assign, pledge or otherwise encumber or dispose of any shares or other
Securities of such Subsidiary or of any other such Subsidiary, except (i) to the
Borrower and any of its wholly-owned Subsidiaries, (ii) to qualify directors if
required by applicable law, (iii) the issuance of promissory notes, drafts or
other instruments or Securities by a Subsidiary to evidence indebtedness
otherwise permitted by Section 7.10 and (iv) to the extent otherwise permitted
by Section 7.6(ii).
7.10 SUBSIDIARY INDEBTEDNESS.
The Borrower will neither cause nor permit (i) any Subsidiary acquired
by the Borrower after the Closing Date to incur any Indebtedness in connection
with the acquisition of such
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Subsidiary by the Borrower (but any such Subsidiary may continue to have
outstanding after the consummation of such acquisition any Indebtedness
previously incurred by such Subsidiary); or (ii) any of its Subsidiaries,
whether now owned or hereafter created or acquired, to incur any Indebtedness if
the aggregate Indebtedness of all of the Borrower's Subsidiaries (excluding
Indebtedness permitted under clause (i)) would, giving effect to the
Indebtedness proposed to be incurred, exceed 7-1/2% of Consolidated Tangible
Assets.
7.11 RESTRICTIONS ON SUBSIDIARY DIVIDENDS.
The Borrower will not permit any of its Subsidiaries to enter into any
agreement prohibiting or restricting the declaration or payment of cash
dividends or other payments by such Subsidiary in respect of Securities of such
Subsidiaries to, or the making of loans, advances to, or other Investments by
such Subsidiary in, the Borrower.
7.12 INDEPENDENCE OF COVENANTS.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or be otherwise within the
limitations of, another covenant shall not avoid the occurrence of an Event of
Default or Default if such action is taken or condition exists.
ARTICLE VIII
EVENTS OF DEFAULT
8.1 EVENTS OF DEFAULT.
If any of the following conditions or events ("Events of Default")
shall occur:
(a) Failure to Make Payments When Due. Failure of the
Borrower to make any payment or prepayment of principal when due
hereunder, whether at stated maturity, by acceleration or otherwise; or
failure of the Borrower to pay any interest, fees or other amounts due
under this Loan Agreement within five (5) days after the date when due
hereunder; or
(b) Default in Other Agreements. Failure of the Borrower
or any of its Subsidiaries to pay, or any default in the payment of,
any principal or interest on any Indebtedness (other than Indebtedness
evidenced by the Notes) or in the payment of any Contingent Obligation,
in either case where the aggregate Indebtedness or Contingent
Obligation exceeds $1,000,000, beyond any period of grace provided; or
any breach or default with respect to any evidence of any Indebtedness
or Contingent Obligation (other than the Indebtedness evidenced by the
Notes) or of any loan agreement, mortgage, indenture or other agreement
relating thereto where the aggregate principal amount of such
Indebtedness or Contingent Obligation then outstanding exceeds
$1,000,000,
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beyond any period of grace provided, if the effect of such failure,
default or breach is to cause, or to permit the holder or holders of
that Indebtedness or Contingent Obligation (or a trustee on behalf of
such holder or holders) to cause, that Indebtedness or Contingent
Obligation to become or be declared due prior to its stated maturity
(upon the giving or receiving of notice, lapse of time, both, or
otherwise); or
(c) Breach of Certain Covenants. Failure of the Borrower
to perform or comply with any term or condition contained in Sections
6.2, 7.4, 7.5 or 7.6 of this Loan Agreement; or
(d) Warranty. Any of the Borrower's representations or
warranties made herein or in any statement or certificate at any time
given by or on behalf of the Borrower in writing pursuant hereto or in
connection herewith shall be false in any material respect on the date
as of which made; or
(e) Other Defaults under this Loan Agreement. The
Borrower shall default in the performance of or compliance with any
provision contained in this Loan Agreement other than those referred to
above in Sections 8(a), (c) or (d) and such default shall not have been
remedied or waived within fifteen (15) days after receipt of notice
from the Agent or any Bank of such default, in the case of Sections
7.1-7.3 or 7.7-7.11, or within thirty (30) days after receipt of notice
from the Agent or any Bank of such default, in the case of any other
provision contained in this Loan Agreement; or
(f) Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A decree or order for relief in respect of
the Borrower or any of its Subsidiaries shall have been
entered in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter
in effect, which decree or order is not stayed; or
(ii) an involuntary case is commenced against the
Borrower or any of its Subsidiaries under any applicable
bankruptcy, insolvency or other similar law now or hereafter
in effect; or a decree or order of a court having jurisdiction
in the premises for the appointment of a receiver, liquidator,
sequestrator, trustee, custodian or other officer having
similar powers over the Borrower or any of its Subsidiaries,
or over all or a substantial part of its property, shall have
been entered; or the involuntary appointment of an interim
receiver, trustee or other custodian of the Borrower or any of
its Subsidiaries for all or a substantial part of its
property; or the issuance of a warrant of attachment,
execution or similar process against any substantial part of
the property of the Borrower or any of its Subsidiaries, and
the continuance of any such events described in this clause
(ii) for 60 consecutive days unless dismissed, bonded or
discharged; or
(g) Voluntary Bankruptcy: Appointment of Receiver, etc.
The Borrower or any of its Subsidiaries shall have an order for relief
entered with respect to it or
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commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or shall consent to
the entry of an order for relief in an involuntary case, or to the
conversion to an involuntary case, under any such law, or shall consent
to the appointment of or taking possession by a receiver, trustee or
other custodian for all or a substantial part of its property; the
making by the Borrower or any of its Subsidiaries of any assignment for
the benefit of creditors; or the inability or failure of the Borrower
or any of its Subsidiaries, or the admission by the Borrower or any of
its Subsidiaries in writing of its inability to pay its debts as such
debts become due; or the Board of Directors of the Borrower or any of
its Subsidiaries (or any committee thereof) adopts any resolution or
otherwise authorizes action to approve any of the foregoing; or
(h) Judgments and Attachments. Any money judgment, writ
or warrant of attachment or similar process involving in any case an
amount in excess of $2,000,000 or any series of money judgments, writs
or warrants of attachment or similar processes involving in the
aggregate an amount in excess of $2,000,000 shall be entered or filed
against the Borrower or its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed
for a period of forty-five (45) days or in any event later than five
(5) days prior to the date of any proposed sale under any such
judgment, writ or warrant of attachment or similar process; or
(i) Condemnations and Seizures. Any court, government
or governmental agency shall condemn, seize or otherwise appropriate,
or take custody or control of all or any portion of the property of
the Borrower or any Subsidiary constituting a substantial portion of
the consolidated total assets of the Borrower and its Subsidiaries; or
(j) Dissolution. Any order, judgment or decree shall be
entered against the Borrower decreeing the dissolution or split up of
the Borrower and such order shall remain undischarged or unstayed for a
period in excess of thirty (30) days; or
(k) Unfunded ERISA Liabilities.
(i) Any Pension Plan maintained by the Borrower
or any of its ERISA Affiliates shall be terminated within the
meaning of Title IV of ERISA,
(ii) a trustee shall be appointed by an
appropriate United States district court to administer any
Pension Plan,
(iii) the Pension Benefit Guaranty Corporation (or
any successor thereto) shall institute proceedings to
terminate any Pension Plan, or
(iv) the Borrower or any of its ERISA Affiliates
shall withdraw (under Section 4063 of ERISA) from a Pension
Plan, if, as of the date thereof or any subsequent date, the
sum of each of the Borrower's and its ERISA Affiliates'
various liabilities (such liabilities to include, without
limitation, any liability to the Pension Benefit Guaranty
Corporation (or any successor thereto) or to any other
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party under Sections 4062, 4063 or 4064 of ERISA or any other
provision of law) resulting from or otherwise associated with
such events listed in clauses (i) through (iv) above exceeds
$1,000,000, exclusive of any withdrawal liability incurred by
the Grief Companies division of the Borrower to the
Amalgamated Pension Fund, a Multiemployer Plan; or
(l) Change of Control. There shall occur a Change of
Control;
then, in any such event, and at any time thereafter, the Agent shall,
upon the written direction of the Majority Banks, or may with the
consent of the Majority Banks, by written notice to the Borrower take
any of the following actions:
(i) Termination of Commitments. Declare the
Banks' obligations to make Loans and the Letter of Credit
Banks' obligations to issue Letters of Credit to be terminated
whereupon the Banks' Commitments shall be immediately
terminated and any commissions or fees relating to the
Commitments shall thereupon become immediately due and payable
without further notice of any kind;
(ii) Acceleration of Loans. Declare the unpaid
principal of and any accrued interest in respect of all the
Notes to be due whereupon the same shall be immediately due
and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the
Borrower;
(iii) Enforcement of Rights. Enforce any and all
rights and interests created and existing under the Loan
Documents or applicable law and all rights of set-off;
(iv) Cash Collateral. Direct the Borrower to pay
(and the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default under Section
8.1(f) or (g)), it will immediately without notice pay to the
Agent an amount equal to the then outstanding Letter of Credit
Obligations which at the option of the Borrower will either be
used to prepay such outstanding Letter of Credit Obligations
or paid to the Agent to be held in a cash collateral account
in the name of the Agent and under the dominion and control of
the Agent as additional security for the reimbursement
obligations which may thereafter arise on account of
subsequent drawings or payments under Letters of Credit still
outstanding;
provided, however, that, notwithstanding the foregoing, if an
Event of Default specified in Section 8.1(f) or (g) shall
occur, then the Banks' Commitments shall automatically
terminate and the Notes and the Loans shall immediately become
due and payable without the giving of any notice or other
action by the Agent or the Banks.
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ARTICLE IX
AGENT
9.1 APPOINTMENT AND AUTHORIZATION OF AGENT.
(a) Each Bank hereby irrevocably (subject to Section 9.9)
appoints, designates and authorizes the Agent to take such action on
its behalf under the provisions of this Loan Agreement and each other
Loan Document and to exercise such powers and perform such duties as
are expressly delegated to it by the terms of this Loan Agreement or
any other Loan Document, together with such powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly
set forth herein, nor shall the Agent have or be deemed to have any
fiduciary relationship with any Bank or participant, and no implied
covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Loan Agreement or any other Loan
Document or otherwise exist against the Agent. Without limiting the
generality of the foregoing sentence, the use of the term "agent"
herein and in the other Loan Documents with reference to the Agent is
not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is
intended to create or reflect only an administrative relationship
between independent contracting parties.
(b) Each Letter of Credit Bank shall act on behalf of such
Letter of Credit with respect to any Letters of Credit issued by it and
the documents associated therewith until such time (and except for so
long) as the Agent may agree at the request of the Majority Banks to
act for the applicable Letter of Credit Bank with respect thereto;
provided, however, that each Letter of Credit Bank shall have all of
the benefits and immunities (i) provided to the Agent in this Article
IX with respect to any acts taken or omissions suffered by such Letter
of Credit Bank in connection with any Letters of Credit issued by it or
proposed to be issued by it and the application and agreements for
letters of credit pertaining to the Letters of Credit as fully as if
the term "Agent" as used in this Article IX included the Letter of
Credit Bank with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to each Letter of Credit
Bank.
9.2 DELEGATION OF DUTIES.
The Agent may execute any of its duties under this Loan Agreement or
any other Loan Document by or through agents, employees or attorneys-in-fact and
shall be entitled to advice of counsel and other consultants or experts
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects in the absence of gross negligence or willful misconduct.
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9.3 LIABILITY OF AGENT.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by it under or in connection with this Loan Agreement or any
other Loan Document or the transactions contemplated hereby or thereby (except
for its own gross negligence or willful misconduct in connection with its duties
expressly set forth herein or therein), or (b) be responsible in any manner to
any Bank or participant for any recital, statement, representation or warranty
made by the Borrower or any officer thereof, contained herein or in any other
Loan Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection
with, this Loan Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Loan Agreement
or any other Loan Document, or for any failure of the Borrower or any other
party to any Loan Document to perform its obligations hereunder or thereunder.
No Agent-Related Person shall be under any obligation to any Bank or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Loan Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrower or any
Affiliate thereof.
9.4 RELIANCE BY AGENT.
(a) The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit,
letter, telegram, facsimile, telex or telephone message, statement 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 counsel to
the Borrower), independent accountants and other experts selected by
the Agent. The Agent shall be fully justified in failing or refusing to
take any action under any Loan Document unless it shall first receive
such advice or concurrence of the Majority Banks as it deems
appropriate and, if it so requests, it shall first be indemnified to
its satisfaction by the Banks 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 Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Loan Agreement or any
other Loan Document in accordance with a request or consent of the
Majority Banks or all the Banks, if required hereunder, and such
request and any action taken or failure to act pursuant thereto shall
be binding upon all the Banks and participants. Where this Loan
Agreement expressly permits or prohibits an action unless the Majority
Banks otherwise determine, the Agent shall, and in all other instances,
the Agent may, but shall not be required to, initiate any solicitation
for the consent or a vote of the Banks.
(b) For purposes of determining compliance with the
conditions specified in Section 4.1, each Bank that has signed this
Loan Agreement shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter either
sent by the Agent to such Bank for consent, approval, acceptance or
satisfaction, or required thereunder to be consented to or approved by
or acceptable or satisfactory to a Bank.
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9.5 NOTICE OF DEFAULT.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default, except with respect to defaults
in the payment of principal, interest and fees required to be paid to the Agent
for the account of the Banks, unless the Agent shall have received written
notice from a Bank or the Borrower referring to this Loan Agreement, describing
such Default or Event of Default and stating that such notice is a "notice of
default." The Agent will notify the Banks of its receipt of any such notice. The
Agent shall take such action with respect to such Default or Event of Default as
may be directed by the Majority Banks in accordance with Article VIII; provided,
however, that unless and until the Agent has received any such direction, the
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable or in the best interest of the Banks.
9.6 CREDIT DECISION; DISCLOSURE OF INFORMATION BY AGENT.
Each Bank acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Agent hereinafter
taken, including any consent to and acceptance of any assignment or review of
the affairs of the Borrower and its Subsidiaries or any Affiliate thereof, shall
be deemed to constitute any representation or warranty by any Agent-Related
Person to any Bank as to any matter, including whether Agent-Related Persons
have disclosed material information in their possession. Each Bank represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Subsidiaries, and all applicable bank or other regulatory laws
relating to the transactions contemplated hereby, and made its own decision to
enter into this Loan Agreement and to extend credit to the Borrower hereunder.
Each Bank also represents that it will, independently and without reliance upon
any Agent-Related Person 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 Loan
Agreement and the other Loan Documents, and to make such investigations as it
deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrower.
Except for notices, reports and other documents expressly required to be
furnished to the Banks by the Agent herein, the Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of any of the Borrower or its Subsidiaries which
may come into the possession of any Agent-Related Person.
9.7 INDEMNIFICATION OF AGENT.
Whether or not the transactions contemplated hereby are consummated,
the Banks shall indemnify upon demand each Agent-Related Person (to the extent
not reimbursed by or on behalf
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of the Borrower and without limiting the obligation of the Borrower to do so),
pro rata, and hold harmless each Agent-Related Person from and against any and
all Indemnified Liabilities incurred by it; provided, however, that no Bank
shall be liable for the payment to any Agent-Related Person of any portion of
such Indemnified Liabilities resulting from such Agent-Related Person's gross
negligence or willful misconduct; provided, however, that no action taken in
accordance with the directions of the Majority Banks shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Bank shall reimburse the Agent upon
demand for its ratable share of any costs or out-of-pocket expenses (including
reasonable fees and costs of counsel) incurred by the Agent in connection with
the preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Loan
Agreement, any other Loan Document, or any document contemplated by or referred
to herein or therein, to the extent that the Agent is not reimbursed for such
expenses by or on behalf of the Borrower. The undertaking in this Section shall
survive termination of the Commitments, the payment of all obligations hereunder
and the resignation or replacement of the Agent.
9.8 AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its respective Affiliates as though Bank
of America were not the Agent or a Letter of Credit Bank hereunder and without
notice to or consent of the Banks. The Banks acknowledge that, pursuant to such
activities, Bank of America or its Affiliates may receive information regarding
the Borrower or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Borrower or such Affiliate) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, Bank of America shall have the
same rights and powers under this Loan Agreement as any other Bank and may
exercise such rights and powers as though it were not the Agent or a Letter of
Credit Bank, and the terms "Bank" and "Banks" include Bank of America in its
individual capacity.
9.9 SUCCESSOR AGENT.
The Agent may resign as Agent upon 30 days' notice to the Banks. If the
Agent resigns under this Loan Agreement, the Majority Banks shall appoint from
among the Banks a successor Agent for the Banks which successor Agent shall be
consented to by the Borrower at all times other than during the existence of a
Default or an Event of Default (which consent of the Borrower shall not be
unreasonably withheld or delayed). If no successor Agent is appointed prior to
the effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Banks and the Borrower, a successor Agent from among the
Banks. Upon the acceptance of its appointment as successor Agent hereunder, such
successor Agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor Agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this
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Article 9 and Sections 10.5 and 10.16 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this Loan
Agreement. If no successor Agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Banks shall perform all of the duties of the Agent hereunder until such
time, if any, as the Majority Banks appoint a successor agent as provided for
above.
ARTICLE X
MISCELLANEOUS
10.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (d)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address set forth on Exhibit 10.1 hereto, or at such other address as such
party may specify by written notice to the other parties hereto.
10.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Bank is authorized at any time and from
time to time, without presentment, demand, protest or other notice of any kind
(all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Bank (including, without
limitation, branches, agencies or Affiliates of such Bank wherever located) to
or for the credit or the account of the Borrower against obligations and
liabilities of the Borrower to such Bank hereunder, under the Notes, the other
Loan Documents or otherwise, irrespective of whether such Bank shall have made
any demand hereunder and although such obligations, liabilities or claims, or
any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an Event of Default
even though such charge is made or entered on the books of such Bank subsequent
thereto. The Borrower hereby agrees that any Person purchasing a participation
in the Loans and Commitments hereunder pursuant to Section 10.3(c) may exercise
all rights of set-off with respect to its participation interest as fully as if
such Person were a Bank hereunder.
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10.3 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Loan 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 Bank
(and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in this Loan 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
Indemnitees) any legal or equitable right, remedy or claim under or by
reason of this Loan Agreement.
(b) Any Bank may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Loan
Agreement and the other Loan Documents (including all or a portion of
its Commitment and the Loans (including for purposes of this subsection
(b), participations in Letter of Credit Obligations) at the time owing
to it); provided that (i) except in the case of an assignment of the
entire remaining amount of the assigning Bank's Commitment and the
Loans at the time owing to it or in the case of an assignment to a Bank
or an Affiliate of a Bank with respect to a Bank, the aggregate amount
of the Commitment (which for this purpose includes Loans outstanding
thereunder) subject to each such assignment, determined as of the date
the Assignment and Acceptance with respect to such assignment is
delivered to the Agent, shall not be less than $5,000,000 unless each
of the Agent and, so long as no Default or Event of Default has
occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed), (ii) each partial
assignment shall be made as an assignment of a proportionate part of
all the assigning Bank's rights and obligations under this Loan
Agreement with respect to the Loans or the Commitment assigned, and
(iii) the parties to each assignment shall execute and deliver to the
Agent an Assignment and Acceptance, substantially in the form of
Exhibit 10.3, together with a processing and recordation fee of $3,500.
Subject to acceptance and recording thereof by the Agent pursuant to
subsection (c) of this Section, from and after the effective date
specified in each Assignment and Acceptance, the Eligible 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 Bank under this Loan Agreement, and the assigning Bank
thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this
Loan Agreement (and, in the case of an Assignment and Acceptance
covering all of the assigning Bank's rights and obligations under this
Loan Agreement, such Bank shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 10.5, 10.14 and
10.16). Upon request, the Borrower (at its expense) shall execute and
deliver new or replacement Notes to the assigning Bank and the assignee
Bank. Any assignment or transfer by a Bank of rights or obligations
under this Loan Agreement that does not comply with this subsection
shall be treated for purposes of this Loan Agreement as a sale by such
Bank of a participation in such rights and obligations in accordance
with subsection (d) of this Section.
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(c) The Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at its office in San Francisco,
California a copy of each Assignment and Acceptance delivered to it and
a register for the recordation of the names and addresses of the Banks,
and the Commitments of, and principal amount of the Loans and Letter of
Credit Obligations owing to, each Bank pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall
be conclusive, and the Borrower, the Agent and the Banks may treat each
Person whose name is recorded in the Register pursuant to the terms
hereof as a Bank hereunder for all purposes of this Loan Agreement,
notwithstanding notice to the contrary. The Register shall be available
for inspection by the Borrower and any Bank, at any reasonable time and
from time to time upon reasonable prior notice.
(d) Any Bank may, without the consent of, or notice to,
the Borrower or the Agent, sell participations to one or more banks or
other entities (a "Participant") in all or a portion of such Bank's
rights and/or obligations under this Loan Agreement (including all or a
portion of its Commitment and/or the Loans (including such Bank's
participations in Letter of Credit Obligations) owing to it); provided
that (i) such Bank's obligations under this Loan Agreement shall remain
unchanged, (ii) such Bank shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower, the Agent and the other Banks shall continue to deal solely
and directly with such Bank in connection with such Bank's rights and
obligations under this Loan Agreement. Any agreement or instrument
pursuant to which a Bank sells such a participation shall provide that
such Bank shall retain the sole right to enforce this Loan Agreement
and to approve any amendment, modification or waiver of any provision
of this Loan Agreement; provided that such agreement or instrument may
provide that such Bank will not, without the consent of the
Participant, agree to any amendment, waiver or other modification that
would (i) postpone any date upon which any payment of money is
scheduled to be paid to such Participant or, (ii) reduce the principal,
interest, fees or other amounts payable to such Participant. Subject to
subsection (e) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 3.4, 3.5, 3.6
and 3.7 to the same extent as if it were a Bank and had acquired its
interest by assignment pursuant to subsection (b) of this Section. To
the extent permitted by law, each Participant also shall be entitled to
the benefits of Section 10.2 as though it were a Bank, provided such
Participant agrees to be subject to Section 10.15 as though it were a
Bank.
(e) A Participant shall not be entitled to receive any
greater payment under Section 3.4, 3.5 or 3.7 than the applicable Bank
would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower's prior written consent. A
Participant that is a foreign person as described in Section 3.7 shall
not be entitled to the benefits of Section 3.7 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 3.7 as though it were a Bank.
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(f) Any Bank may at any time pledge or assign a security
interest in all or any portion of its rights under this Loan Agreement
(including under its Notes, if any) to secure obligations of such Bank,
including any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release
a Bank from any of its obligations hereunder or substitute any such
pledgee or assignee for such Bank as a party hereto.
(g) If the consent of the Borrower to an assignment or to
an Eligible Assignee is required hereunder (including a consent to an
assignment which does not meet the minimum assignment threshold
specified in clause (i) of the proviso to the first sentence of Section
10.3(b), the Borrower shall be deemed to have given its consent five
Business Days after the date notice thereof has been delivered by the
assigning Bank (through the Agent) unless such consent is expressly
refused by the Borrower prior to such fifth Business Day.
(h) Notwithstanding anything to the contrary contained
herein, if at any time a Bank assigns all of its Commitment and Loans
pursuant to subsection (b) above, such Bank may, upon 90 days' notice
to the Borrower and the Banks, resign as a Letter of Credit Bank;
provided, however, that in the event that such Letter of Credit Bank
seeking resignation is the sole Letter of Credit Bank at such time,
such resignation shall only become effective upon acceptance by another
Bank to act as a successor Letter of Credit Bank hereunder. Each Letter
of Credit Bank shall retain all the rights and obligations of a Letter
of Credit Bank hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as a Letter of
Credit Bank and all Letter of Credit Obligations with respect thereto
(including the right to require the Banks to make Prime Rate Loans or
fund participations in Letters of Credit pursuant to Section 2.6).
10.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Agent or any Bank in exercising
any right, power or privilege hereunder or under any other Loan Document and no
course of dealing between the Borrower and the Agent or any Bank shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Loan Document preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights and remedies provided herein are
cumulative and not exclusive of any rights or remedies which the Agent or any
Bank would otherwise have. No notice to or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the Agent or the
Banks to any other or further action in any circumstances without notice or
demand.
10.5 PAYMENT OF EXPENSES, ETC.
The Borrower agrees to: (a) pay all reasonable out-of-pocket costs and
expenses of the Agent in connection with the syndication of this Loan Agreement,
the due diligence associated with this transaction and the negotiation,
preparation, execution and delivery and administration of this Loan Agreement
and the other Loan Documents and the documents and instruments referred to
therein (including, without limitation, the reasonable fees and expenses of
special
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counsel to the Agent) and any amendment, waiver or consent relating hereto and
thereto, including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Borrower under this Loan Agreement and of the Banks in
connection with enforcement of the Loan Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and disbursements of counsel for the Agent and each of the Banks); (b) pay
and hold each of the Banks harmless from and against any and all present and
future stamp, recording and other similar taxes with respect to the foregoing
matters and save each of the Banks harmless from and against any and all
liabilities with respect to or resulting from any delay or omission (other than
to the extent attributable to such Bank) to pay such taxes; and (c) indemnify
each Bank, its officers, directors, employees, representatives and agents from
and hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of, any investigation, litigation or
other proceeding (whether or not any Bank is a party thereto) related to the
entering into and/or performance of any Loan Document or the use of proceeds of
any Loans hereunder or the consummation of any other transactions contemplated
in any Loan Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of gross negligence
or willful misconduct on the part of the Person to be indemnified).
10.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Loan Agreement nor any other Loan Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing signed by the Majority Banks and the Borrower, provided that no such
amendment, change, waiver, discharge or termination shall, without the consent
of each Bank, (a) extend the scheduled maturities (including the final maturity
and any mandatory prepayments) of any Loan or any portion thereof, or reduce the
rate or extend the time of payment of interest thereon or fees hereunder or
reduce the principal amount thereof, or increase the Commitment of any Bank over
the amount thereof then in effect, (b) amend, modify or waive any provision of
this Section, (c) reduce any percentage specified in, or otherwise modify, the
definition of Majority Banks, (d) consent to the assignment or transfer by the
Borrower of any of its rights and obligations under (or in respect of) this Loan
Agreement or (e) modify the definition of "Termination Date". No provision of
Article IX may be amended without the consent of the Agent.
10.7 COUNTERPARTS.
This Loan Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Loan Agreement to produce or account for more than one such
counterpart.
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10.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Loan Agreement.
10.9 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 3.4, 10.5 or 10.16, shall survive the execution and delivery of this
Loan Agreement, the making of the Loans, the repayment of the Loans and other
obligations of the Borrower hereunder and the termination of the Commitment
hereunder.
10.10 CALCULATIONS; COMPUTATIONS.
(a) The financial statements furnished to the Banks
pursuant hereto shall be made and prepared in accordance with generally
accepted accounting principles applied on a consistent basis for the
periods involved.
(b) All computations of interest and fees hereunder
shall, unless otherwise noted, be made on the basis of actual number of
days elapsed over a year of 360 days.
(c) In the event any payment of principal, interest, fees
or other amount is due on a day which is not a Business Day, the
payment shall be extended to the next succeeding Business Day together
with, in the case of a payment of principal, interest thereon to the
date of payment (except in the case of Eurodollar Loans, if the next
succeeding Business Day is in a different calendar month, then on the
next preceding Business Day).
10.11 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TENNESSEE. Any legal action or proceeding with
respect to this Loan Agreement or any other Loan Document may be
brought in the courts of the State of Tennessee in Davidson County, or
of the United States for the Middle District of Tennessee, and, by
execution and delivery of this Loan Agreement, the Borrower hereby
irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of such courts. The
Borrower further irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to the Borrower at its address for notices set forth beneath
its signature, such service to become effective 30 days after such
mailing. Nothing herein shall affect the right of the Banks to serve
process in any other manner permitted by law or to commence legal
proceedings or to otherwise proceed against the Borrower in any other
jurisdiction.
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Page 72
(b) The Borrower hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Loan Agreement or any other Loan Document brought in the courts
referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such
action or proceeding brought in any such court has been brought in an
inconvenient forum.
(c) THE BORROWER AND EACH BANK HEREBY IRREVOCABLY WAIVE
TO THE EXTENT PERMITTED BY APPLICABLE LAW ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS LOAN AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
10.12 SEVERABILITY.
If any provision of any of the Loan Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
10.13 ENTIRETY.
This Loan Agreement together with the other Loan Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Loan Documents or the transactions
contemplated herein and therein.
10.14 SURVIVAL.
All representations and warranties made by the Borrower herein shall
survive delivery of the Notes and the making of the Loans and the issuance of
the Letters of Credit hereunder.
10.15 PRO RATA, SHARING.
Each Bank agrees that, if it should receive any amount hereunder
(whether voluntary payment, by realization upon security, by the exercise of the
right of setoff or banker's lien, by counterclaim or cross action, by the
enforcement of any right under the Loan Documents or otherwise) which is
applicable to the payment of the principal of, or interest or fees on, the Loans
or the reimbursement obligations of the Borrower in connection with Letters of
Credit, of a sum which with respect to the related sum or sums received by the
other Banks is in a greater proportion than the total of such obligation than
owned and due to such Bank bears to the total of such obligation prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse or warranty from the other Banks an interest in the
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obligations of the Borrower to such Banks in such amount as will result in a
proportional participation by all of the Banks in such amount, provided that if
all or any portion of such excess amount is thereafter recovered from such Bank,
such purchase shall be rescinded and the purchase price restored to the extent
of such recovery, but without interest.
10.16 INDEMNITY.
Whether or not the transactions contemplated hereby are consummated,
the Borrower agrees to indemnify, save and hold harmless each Agent-Related
Person, each Bank and their respective Affiliates, directors, officers,
employees, counsel, agents and attorneys-in-fact (collectively the
"Indemnitees") from and against: (a) any and all claims, demands, actions or
causes of action that are asserted against any Indemnitee by any Person (other
than the Agent or any Bank) relating directly or indirectly to a claim, demand,
action or cause of action that such Person asserts or may assert against the
Borrower, any Affiliate of the Borrower or any of its respective officers or
directors; (b) any and all claims, demands, actions or causes of action that may
at any time (including at any time following repayment of the Obligations and
the resignation or removal of the Agent or the replacement of any Bank) be
asserted or imposed against any Indemnitee, arising out of or relating to, the
Loan Documents, any predecessor Loan Documents, the Commitments, the use or
contemplated use of the proceeds of any Loan or Letter of Credit, or the
relationship of the Borrower, the Agent and the Banks under this Loan Agreement
or any other Loan Document; (c) any administrative or investigative proceeding
by any governmental authority arising out of or related to a claim, demand,
action or cause of action described in subsection (a) or (b) above; and (d) any
and all liabilities (including liabilities under indemnities), losses, costs or
expenses (including reasonable fees and costs of counsel) that any Indemnitee
suffers or incurs as a result of the assertion of any foregoing claim, demand,
action, cause of action or proceeding, or as a result of the preparation of any
defense in connection with any foregoing claim, demand, action, cause of action
or proceeding, in all cases, whether or not arising out of the negligence of an
Indemnitee, and whether or not an Indemnitee is a party to such claim, demand,
action, cause of action or proceeding (all the foregoing, collectively, the
"Indemnified Liabilities"); provided that no Indemnitee shall be entitled to
indemnification for any claim caused by its own gross negligence or willful
misconduct or for any loss asserted against it by another Indemnitee. The
agreements in this Section shall survive the termination of the Commitments and
repayment of all the other Obligations.
10.17 CONFIDENTIALITY.
Each of the Agent and the Banks 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 Loan Agreement; (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Loan Agreement, the other Loan Documents or the
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enforcement of rights hereunder or thereunder; (f) subject to an agreement
containing provisions substantially the same as those of this Section or so long
as such Person has agreed to be bound by the terms of this Section 10.17, to (i)
any Eligible Assignee of or Participant in, or any prospective Eligible Assignee
of or Participant in, any of its rights or obligations under this Loan Agreement
or (ii) any direct or indirect contractual counterparty or prospective
counterparty (or such contractual counterparty's or prospective counterparty's
professional advisor) to any credit derivative transaction relating to
obligations of the Borrower; (g) with the consent of the Borrower; (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 Agent or any Bank on a
nonconfidential basis from a source other than the Borrower; or (i) to the
National Association of Insurance Commissioners or any other similar
organization or any nationally recognized rating agency that requires access to
information about a Bank's or its Affiliates' investment portfolio in connection
with ratings issued with respect to such Bank or its Affiliates. 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 Agent or any Bank on a nonconfidential
basis prior to disclosure by the Borrower. 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.
75
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Loan Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: GENESCO INC.
By /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Title Treasurer
---------------------------------------
76
BANKS: BANK OF AMERICA, N.A.
Individually as a Bank and as Agent
By /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
Title Managing Director
---------------------------------------
77
FIFTH THIRD NATIONAL BANK
By /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
Title Corporate Banking Officer
---------------------------------------
78
FLEET NATIONAL BANK
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Title Director
---------------------------------------
79
THE CHASE MANHATTAN BANK
By /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Title Relationship Manager
---------------------------------------
80
BANK ONE, NA
By /s/▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
Title Vice President
---------------------------------------
81
EXHIBIT 1.1(a)
Committed Amounts
COMMITTED AMOUNT COMMITMENT PERCENTAGE
---------------- ---------------------
Bank of America, N.A. $20,000,000 26.7%
Fleet National Bank $17,500,000 23.3%
The Chase Manhattan Bank $15,000,000 20.0%
Bank One, N.A. $15,000,000 20.0%
Fifth Third Bank $ 7,500,000 10.0%
Totals $75,000,000 100%
82
EXHIBIT 2.5
PROMISSORY NOTE
July 16, 2001
FOR VALUE RECEIVED, GENESCO INC., a Tennessee corporation (the
"Borrower"), promises to pay to the order of ______________________ (the "Bank")
on or before the Termination Date to the office of the Bank in immediately
available funds as provided in the Loan Agreement, the Committed Amount or, if
less, the aggregate principal amount of all Loans, made by the Bank to the
Borrower under the Loan Agreement, together with interest thereon at the rates
and on the terms as provided in the Loan Agreement.
This Note is one of the "Notes" in the aggregate principal amount of
$75,000,000 and is issued pursuant to and entitled to the benefits of the Second
Amended, Restated and Modified Loan Agreement dated as of the date hereof among
the Borrower, the Banks identified therein and Bank of America, N.A., as Agent
(the "Loan Agreement"). Capitalized terms used herein without definition shall
have the meanings set forth in the Loan Agreement.
All payments of principal and interest in respect of this Note shall be
made in lawful money of the United States of America in same day funds at the
office of the Agent set forth in the Loan Agreement, or at such other place as
shall be designed in writing for such purpose in accordance with the terms of
the Loan Agreement.
Until notified in writing of the transfer of this Note, the Borrower
and the Agent shall be entitled to deem the Bank or such person who has been so
identified by the transferor in writing to the Borrower and the Agent as the
holder of this Note, as the owner and holder of this Note. Each of the Bank and
any subsequent holder of this Note agrees that before disposing of this Note or
any part hereof it will make a notation hereon of all principal payments
previously made hereunder and of the date to which interest hereon has been
paid; provided, that the failure to make a notation of any payment made on this
Note shall not limit or otherwise affect the obligation of the Borrower
hereunder with respect to payments of principal or interest on this Note.
The Loan Agreement and this Note shall be governed by, and shall be
construed and enforced in accordance with the laws of the State of Tennessee
except to the extent that the federal laws of the United States of America are
applicable to the rates of interest chargeable by the Bank under the Loan
Agreement and the matters set forth in the immediately preceding paragraph.
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note may become, or may be declared to be, due and
payable in the manner, upon the conditions and with the effect provided in the
Loan Agreement.
83
The terms of this Note are subject to amendment only in the manner
provided in the Loan Agreement.
No reference herein to the Loan Agreement and no provision of this Note
or the Loan Agreement shall alter or impair the obligation of the Borrower,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the place, at the respective times, and in the currency herein
prescribed.
The Borrower promises to pay all costs and expenses, including
reasonable attorneys' fees, incurred in the collection and enforcement of this
Note or any appeal of a judgment rendered thereon. The Borrower and all
endorsers of this Note hereby consent to renewals and extensions of time for the
payment hereof at or after the maturity hereof, without notice, and hereby waive
diligence, presentment, protest, demand and notice of every kind and, to the
full extent permitted by law, the right to plead any statute of limitations as a
defense to any demand hereunder.
84
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed
and delivered by its duly authorized officer, as of the day and year and the
place first above written.
GENESCO INC.
By:
------------------------------
Title:
---------------------------
85
EXHIBIT 2.6
EXISTING LETTERS OF CREDIT
[see attached chart]
86
All of the following Letters of Credit are issued by Bank One, N.A.:
GENESCO INC.
Standby Letters of Credit
Beneficiary Open Expiry Curr Open Outstanding Outstanding
Date Date Amount Amount USD Equivalent
----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇ LOGISTICS BV 12/09/99 01/31/02 NLG 80,000.00 80,000.00 30,156.42
TRAVELERS INDEMNITY COMPANY 01/17/96 01/16/02 USD 1,700,000.00 1,700,000.00 1,700,000.00
520 MADISON VENTURE 01/01/99 01/31/02 USD 327,500.00 327,500.00 327,500.00
MADISON TOWER ASSOCIATES LIMITED 05/31/96 07/31/02 USD 138,750.00 138,750.00 138,750.00
EMPLOYERS REINSURANCE CORPORATION 07/31/96 07/31/02 USD 1,500,000.00 750,000.00 750,000.00
▇▇. ▇▇▇▇ ▇▇▇▇▇▇ 09/25/00 07/31/02 USD 1,000,000.00 1,000,000.00 1,000,000.00
METROPOLITAN TRANSPORTATION AUTHORITY 05/01/00 06/01/07 USD 85,795.68 85,795.68 85,795.68
---------------------------------------------------------------------------------------------------------------------------------
Total 4,032,202.10
GENESCO INC.
Commercial Letters of Credit Outstanding
Beneficiary Open Expiry Curr Open Outstanding Outstanding
Date Date Amount Amount USD Equivalent
----------------------------------------------------------------------------------------------------------------------------------
CALZATURIFICO MARITAN S.P.A. 01/31/01 08/20/01 USD 810,344.40 236,390.40 236,390.40
SPEEDWELL AND CO., LTD. 02/23/01 09/03/01 USD 418,368.72 46,106.40 46,106.40
REGENT FAIR IND. LTD 04/06/01 07/06/01 USD 161,095.80 161,095.80 161,095.80
GLOBALAC DEVELOPMENT LTD. 04/06/01 07/23/01 USD 1,306,197.00 170,576.64 170,576.64
SPEEDWELL AND CO., LTD. 04/23/01 08/31/01 USD 133,648.20 71,903.40 71,903.40
EUROSPORT 04/11/01 09/25/01 EUR 350,388.12 350,388.12 291,067.41
WEALTH PORT INT'L CORP. 12/22/00 07/26/01 USD 465,258.60 80,154.00 80,154.00
CLASSIC AND CASUAL S.A. 07/10/01 09/05/01 EUR 4,552.32 4,552.32 3,781.61
SPEEDWELL AND CO., LTD. 03/20/01 08/01/01 USD 216,200.04 53,344.44 53,344.44
WEALTH PORT INT'L CORP. 04/20/01 09/10/01 USD 343,949.40 343,949.40 343,949.40
GLOBALAC DEVELOPMENT LTD. 04/23/01 08/01/01 USD 1,318,110.60 805,647.96 805,647.96
---------------------------------------------------------------------------------------------------------------------------------
Total 2,264,017.46
87
GENESCO INC.
Letters of Credit Acceptances Outstanding
Beneficiary Acceptance Expiry Curr Outstanding
Date Date USD Equivalent
-----------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇ SHOES PRIVATE LTD. 05/31/01 07/30/01 USD 22,880.64
MAXAMA TRADING CORPORATION 05/31/01 07/30/01 USD 56,886.00
SPEEDWELL AND CO., LTD. 05/14/01 07/13/01 USD 0.00 (matured)
SPEEDWELL AND CO., LTD. 06/09/01 08/08/01 USD 44,880.00
GLOBALAC DEVELOPMENT LTD. 06/16/01 07/16/01 USD 288,286.68
GLOBALAC DEVELOPMENT LTD. 06/22/01 07/23/01 USD 66,999.36
SPEEDWELL AND CO., LTD. 05/14/01 07/13/01 USD 0.00 (matured)
SPEEDWELL AND CO., LTD. 06/09/01 08/08/01 USD 7,296.00
SPEEDWELL AND CO., LTD. 06/02/01 08/01/01 USD 94,307.40
SPEEDWELL AND CO., LTD. 06/08/01 08/07/01 USD 34,776.00
GLOBAL DEVELOPMENT LTD. 06/22/01 07/23/01 USD 98,148.72
----------------------------------------------------------------------------------------------------------
Total 880,785.12
Grand Total: All L/Cs and Acceptances 7,177,004.68
Total: All L/Cs 6,296,219.56
88
EXHIBIT 4.1(c)
FORM OF LEGAL OPINION
[see attached]
89
[Form of Legal Opinion of Boult, Cummings, ▇▇▇▇▇▇▇ & ▇▇▇▇▇ PLC]
July 16, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇.▇., as Administrative Agent,
and each of the Banks party to the
Loan Agreement referred to below
c/o Bank of America, N.A.
Agency Administrative Services
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
We have acted as special counsel to Genesco Inc., a Tennessee
corporation (the "Borrower") in connection with the Second Amended, Restated and
Modified Loan Agreement dated as of July 16, 2001, among the Borrower, the
several Banks from time to time party thereto, Bank of America, N.A., as
Administrative Agent (the "Administrative Agent") (the "Loan Agreement").
This opinion is being delivered pursuant to Section 4.1(c) of the
Credit Agreement. Capitalized terms used herein but not otherwise defined herein
shall have the respective meanings accorded such terms in the Loan Agreement.
In rendering this opinion, we have reviewed the documents:
1. The Certificate dated as of July 16, 2001, of ________________
of Borrower as to certain factual the matters, a copy of which is attached
hereto as Exhibit A (the "Officer's Certificate");
2. Certificate dated as of July 16, 2001, of the Secretary of
Borrower as to the Borrower's By-laws and the incumbency and signature of
certain officers of Borrower, a copy of which is attached as Exhibit B (the
"Secretary's Certificate");
3. Certificates of the Secretary of State of the state of
Tennessee dated July 2, 2001, relating to the existence and good standing of
Borrower and certain Subsidiaries (the "Tennessee Certificates of Existence");
4. Certificates of the Secretary of State of the state of
Tennessee, dated July 2, 2001, related to the incorporation of Borrower and
certain subsidiaries (the "Tennessee Certificates of Incorporation");
5. Certificates of the Secretary of State of the state of
Delaware dated June 29, 2001, relating to the existence and good standing of
certain Subsidiaries (the "Delaware Certificates of Existence");
6. Certificates of the Secretary of State of the state of
Delaware dated June 29, 2001, related to the incorporation of certain
Subsidiaries (the "Delaware Certificates of Incorporation");
7. Resolutions of the Board of Directors of the Borrower;
90
8. The Loan Agreement; and
9. Each of the Notes;
The documents referenced in 1 through 7 above are collectively referred
to herein as the "Certificates." The documents referenced in 8 and 9 above are
collectively referred to herein as the "Loan Documents."
For the purpose of issuing this letter, we have assumed (i) the
genuineness of all signatures on documents we have reviewed, other than those of
Borrower, (ii) the authenticity of all documents submitted to us as originals,
(iii) the conformity to authentic original documents of all documents submitted
to us as certified, conformed, or photostatic copies, and (iv) regarding
documents executed by parties other than Borrower, we have assumed that the
other parties have the due power and authority to execute, deliver and perform
under such documents, the due execution of the same by such other parties and
that such documents are the binding and enforceable obligations of such other
parties. We have further relied upon the Certificates as to matters set forth
therein.
Our opinions herein are limited to matters of Tennessee law and the
federal laws of the United States of America.
Opinions stated to our knowledge reflect only that our attorneys
materially engaged in this transaction have no actual present awareness to the
contrary, following inquiry made of the Borrower but no further diligence or
inquiry whatsoever on our part, except as may be specifically described.
Based on the foregoing, but subject to the additional limitations,
qualifications and assumptions set forth below, it is our opinion that:
1. Each of Borrower and its Subsidiaries (other than Genesco
Netherlands B.V.) has been duly organized and is validly existing as a
corporation under the laws of the jurisdiction of its organization, with
corporate and authority to own its properties and conduct its business in the
ordinary course.
2. Each of Borrower and its Subsidiaries (other than Genesco
Netherlands B.V.) is duly licensed or qualified as a corporation authorized to
transact business and is in good standing in each foreign jurisdiction in which
the character of the properties owned by it or the nature of the business
transacted by it makes such licensing or qualification necessary. Neither the
Borrower nor its Subsidiaries (other than Genesco Netherlands B.V.) are subject
to any material liability or disability by reason of failure to be so qualified
or licensed in any such jurisdiction. For purposes of this opinion, we have
relied exclusively without further investigation, with your consent, on the
Certificates.
3. The execution, delivery and performance of the Loan Documents
have been duly authorized by all necessary corporate action on the part of
Borrower, and the provisions of the Loan Documents are valid and binding
obligations of Borrower enforceable in accordance with their terms.
91
4. To our knowledge, the Loan Documents to which Borrower is a
party (a) will not violate any Requirement of Law or contractual obligation of
Borrower in any respect that would reasonably be expected to have a Material
Adverse Effect, (b) will not result in, or require, the creation or imposition
of any Lien on any properties or revenues of Borrower pursuant to any such
Requirement of Law or contractual obligation, and (c) will not violate or
conflict with any provision of Borrower's articles of incorporation or by-laws.
5. No consent or authorization of, filing with, notice to or
other similar act by or in respect of, any Governmental Authority or, to our
knowledge, any other Person is required to be obtained or made by or on behalf
of Borrower in connection with the borrowings under the Loan Documents or with
the execution, delivery, performance, validity or enforceability of the Loan
Documents to which the Borrower is a party.
6. To our knowledge and except as set forth in the financial
statements described in section 5.3 of the Loan Agreement, there are no actions,
suits or proceedings pending or threatened against or affecting Borrower, any of
its Subsidiaries or any of its properties before any Governmental Authority that
could reasonably be expected to have a Material Adverse Effect. For purposes of
this opinion, we have relied exclusively without further investigation, with
your consent, on the Certificates.
7. To our knowledge, there are no actions, suits or proceedings
pending or threatened against or affecting Borrower, any of its Subsidiaries or
any of its properties before any Governmental Authority that in any manner draws
into question the validity, legality or enforceability of any Loan Document or
any transaction contemplated thereby.
8. The Loan Documents expressly provide that the terms and
provisions thereof will be governed by and construed in accordance with the laws
of the State of Tennessee. Tennessee law recognizes the right of parties to a
contract to elect the application of laws of a particular state or nation to
govern the validity and construction of a contract, as long as the forum
selected bears a "reasonable relation" to the transaction. The existence of a
"reasonable relation" is an issue of fact. Numerous factors are relevant to this
inquiry including the place of negotiation, delivery and execution of the Loan
Documents and the location of the parties to the transaction contemplated
thereby. We have been advised, and assumed without independent verification for
purposes of issuing the opinion contained in this paragraph, that (i) the
principal place of business of Borrower is in Tennessee, (ii) the Loan Documents
have been negotiated by Borrower in Tennessee, and (iii) the Loan Documents have
been executed and delivered by Borrower in Tennessee. These factors should be
sufficient to support the finding of a reasonable relationship between the
transaction contemplated by the Loan Documents and Tennessee. We note that
choice-of-law provisions may not be upheld in the State to enforce provisions
that, at the time of attempted enforcement, violate a fundamental public policy
of the State and that choice-of-law elections may not be observed by courts of
the State with respect to tort actions and other actions not sounding in
contract that might arise in connection with the transaction contemplated by the
Loan Documents.
The opinions expressed above are further subject to the following
qualifications, limitations and assumptions:
92
(a) The opinions set forth above, insofar as they relate to the
enforceability of the Loan Documents, are subject to the effect of bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
relating to or affecting creditors' rights (including, without limitation,
preference and fraudulent conveyance or transfer laws).
(b) Certain waivers and remedies included in the Loan Documents
may be subject to additional limitations; however, the statutes and judicial
decisions giving rise to any such limitations do not affect the overall validity
of the Loan Documents or impair the validity of the debt obligations provided
for therein or otherwise interfere with the practical realization of the
principal benefits reasonably intended to be provided by the Loan Documents.
(c) We express no opinion as to the effect of Tennessee laws
regulating or limiting in any fashion calculation, payment or collection of late
charges, commitment fees, prepayment penalties or other loan charges or fees,
however denominated.
(d) The unenforceability under certain circumstances, under
Tennessee statutes or court decisions, of provisions indemnifying or
prospectively releasing a party against liability for its own wrongful or
negligent acts or where the release or indemnification is contrary to public
policy.
(e) The binding effect and enforceability of the Loan Documents
and the availability of injunctive relief or other equitable remedies thereunder
are subject to the effect of general principles of equity (regardless of whether
enforcement is considered in proceedings at law or in equity).
(f) The possible ineffectiveness of any waiver of trial by jury,
agreement for acceptance of process by mail or forum selection provision.
(g) To the extent that matters covered by such opinion would be
governed by laws other than the laws of the State of Tennessee and the federal
laws of the United States of America, we have assumed that such laws are
identical to those of the State of Tennessee.
Whenever our opinion herein with respect to the existence or absence of
facts is indicated to be based on our knowledge, it is intended to signify that
no lawyer in the firm who has given substantive legal attention to the
representation of Borrower in connection with the transaction which is the
subject of this opinion has any actual conscious awareness of facts or
information to indicate otherwise. Except to the extent expressly set forth
herein, we have not undertaken any independent investigation to determine the
existence or absence of such facts, and no inference as to our knowledge of the
existence or absence of such facts should be drawn from our representation of
Borrower.
We expressly disclaim any responsibility for advising you of any change
occurring hereafter in circumstances concerning the transaction which is the
subject of this letter, including any changes in the law or in factual matters
occurring after the date of this letter. Your acceptance of this letter shall
constitute your acknowledgment that you have not relied upon any representation
on our part in this transaction beyond the specific matters set forth herein.
This letter is furnished only to the Administrative Agent and the Banks
and is solely for their benefit in connection with the transactions contemplated
by the Loan Documents; provided, however, this opinion may be relied upon by any
assignee who becomes a Lender under the Credit Agreement in compliance with
Section 10.3 of the Loan Agreement. This opinion is not to be used, circulated,
quoted or otherwise relied upon by any other person or entity or, for any other
purpose, without our prior written consent.
Sincerely yours,
93
EXHIBIT 5.1(c)
SUBSIDIARIES
▇▇▇▇▇▇ Street Corporation - Delaware
▇▇▇▇▇ Bros. of Puerto Rico, Inc. - Delaware
Genesco Merger Company, Inc. - Tennessee
Genesco Properties, Inc. - Tennessee
Genesco Global, Inc. - Delaware
GVI, Inc. - Delaware
Genesco World Apparel, Ltd. - Delaware
Genesco Netherlands B.V. - Netherlands
Genesco Brands, Inc. - Delaware
94
EXHIBIT 5.8(a)
CONTRACTUAL OBLIGATIONS
The Borrower is party to that certain Indenture dated as of April 9,
1998 relating to its 5 1/2% Convertible Subordinated Notes due April 15, 2005.
95
EXHIBIT 7.2(d)
EXISTING INVESTMENTS
Genesco Inc. As of: 7/12/2001
Exhibit of Investments
INVESTMENT NAME INVESTMENT
--------------- ----------
NationsFunds Money Market Reserve 14,425,000.00
Federated Investors Prime Obligation 15,300,000.00
Bank of America Sweep (West) 111,823.00
Bank of America Sweep (East) 635,330.42
Bank One Sweep 364,076.25
-------------
Total 30,836,229.67
==============
96
EXHIBIT 10.1
NOTICE ADDRESSES
IF TO THE BORROWER:
Genesco Inc.
Genesco Park
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE AGENT:
Credit Contact: Bank of America, N.A.
Bank of America ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Operations Contact: Bank of America, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
Mail Code: CA4-706-05-09
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE OTHER BANKS:
Fleet National Bank
Credit Contact: Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
MADE 10008F
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
97
Operations Contact: Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
MADE 10008F
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The Chase Manhattan Bank
Credit Contact: The Chase Manhattan Bank
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Relationship Manager
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Operations Contact: The Chase Manhattan Bank
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Bank One, NA
Credit Contact: Bank One, NA
1 Bank ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇,
Senior Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Operations Contact: Bank One, NA
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Fifth Third Bank
Credit Contact: Fifth Third Bank
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Corporate Banking Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Operations Contact: Fifth Third Bank
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇,
Account Coordinator
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
98
EXHIBIT 10.3(c)
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated ______________, 2001
Reference is made to the Second Amended, Restated and Modified Loan
Agreement dated as of July 16, 2001 (the "Loan Agreement") among Genesco Inc.,
the Banks listed on the signature pages thereto and Bank of America, N.A. as
agent (the "Agent"). Terms defined in the Loan Agreement are used herein with
the same meaning.
_______________________ (the "Assignor") and ________________________
(the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, a ___________ interest
in and to all of the Assignor's rights and obligations under the Loan Agreement
as of the Effective Date (as defined below) (including, without limitation, such
percentage interest in the Assignor's Commitment under the Loan Agreement as in
effect on the Effective Date, the Loans owing to the Assignor under the Loan
Agreement on the Effective Date, and the Notes held by the Assignor under the
Loan Agreement and the rights and obligations appurtenant thereto under the Loan
Documents.
2. The Assignor (i) represents and warrants that as of the date
hereof its Commitment under the Loan Agreement (without giving effect to
assignments thereof which have not yet become effective) is $_____________; (ii)
represents and warrants that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and clear
of any adverse claim; (iii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Loan Agreement or any other Loan Document or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Loan Agreement or any Loan Document or any other instrument or
document furnished pursuant thereto; (iv) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under the Loan Agreement or any Loan Document or any other
instrument or document furnished pursuant thereto; and (v) attaches the Notes
referred to in paragraph 1 above and requests that the Agent exchange such Notes
for [specify the date and principal amount of the Notes to be delivered to the
Assignee and, if the Assignor is retaining an interest in the Loan Agreement,
the date and principal amount of the Notes to be delivered to the Assignor].
3. The Assignee (i) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance (ii) confirms that it
has received a copy of the Loan Agreement and each other Loan Document (as
defined in the Loan Agreement), together with copies of the financial statements
referred to in Section 5.3(a) of the Loan Agreement, the annual financial
statements referred to in Section 6.1(b) of the Loan Agreement for the fiscal
year ending ______________, the quarterly financial statements referred to in
Section 6.1(a) of the Loan Agreement for the fiscal quarters ending ____________
and such other documents and
99
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (iii) agrees that it
will, independently and without reliance upon the Agent, the Assignor or any
other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Agreement or any other Loan Document; (iv)
appoints and authorizes the Agent to take such action as the Agent on its behalf
and to exercise such powers under the Loan Agreement and each Loan Document as
are delegated to the Agent by the terms thereof, together with such powers as
are reasonably incidental thereto; (v) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Agreement
or any Loan Document are required to be performed by it as a Bank; and (vi)
specifies as its address for notices the address set forth beneath its name on
the signature pages hereof [and (vii) attaches the forms prescribed by the
Internal Revenue Service of the United States certifying as to the Assignee's
status for purposes of determining exemption from United States withholding
taxes with respect to all payments to be made to the Assignee under the Loan
Agreement and the Notes or such other documents as are necessary to indicate
that all such payments are subject to such rates at a rate reduced by an
applicable tax treaty].
4. The effective date for this Assignment and Acceptance shall be
_____________ (the "Effective Date"). Following the execution of this Assignment
and Acceptance, it will be delivered to the Agent for acceptance and recording
by the Agent.
5. Upon such acceptance and recording, as of the Effective Date,
(i) the Assignee shall be a party to the Loan Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Agreement.
6. Upon such acceptance and recording, from and after the
Effective Date, the Agent shall make all payments under the Loan Agreement and
the Notes of the Assignor in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Loan Agreement and such Notes of the Assignor
for periods prior to the Effective Date directly between themselves.
100
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Tennessee.
---------------------------------
By:
------------------------------
Title:
[name of Assignee]
By:
------------------------------
Title:
Address for Notices:
---------------------------------
---------------------------------
---------------------------------
Accepted this ____ day
of ____________, 200__
BANK OF AMERICA, N.A. as Agent
By
---------------------------------
Title
-------------------------------
GENESCO INC.
By
---------------------------------
Title
-------------------------------