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EXHIBIT 10.2
AMENDED AND RESTATED
MULTICURRENCY CREDIT AGREEMENT
DATED AS OF MARCH 6, 1998
AMONG
C.P. CLARE CORPORATION
AND
C.P. CLARE N.V.
AND
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS....................................................... 1
Section 1.1. Certain Defined Terms................................. 1
Section 1.2. Other Interpretive Provisions......................... 19
Section 1.3. Accounting Principles................................. 20
Section 1.4. Currency Equivalents Generally........................ 20
ARTICLE II THE CREDITS...................................................... 20
Section 2.1. Amounts and Terms of Commitments...................... 20
Section 2.2. Loan Accounts......................................... 21
Section 2.3. Procedure for Borrowing............................... 22
Section 2.4. Conversion and Continuation Elections................. 23
Section 2.5. Utilization of Commitments in Offshore Currencies..... 24
Section 2.6. Voluntary Termination or Reduction of Commitments..... 26
Section 2.7. Optional Repayments................................... 26
Section 2.8. Currency Exchange Fluctuations........................ 27
Section 2.9. Repayment............................................. 27
Section 2.10. Interest............................................. 27
Section 2.11. Fees................................................. 28
Section 2.12. Computation of Fees and Interest..................... 28
Section 2.13. Payments by a Company................................ 29
Section 2.14. Payments by the Banks to the Agent................... 30
Section 2.15. Sharing of Payments, Etc............................. 30
Section 2.16. Financial Services................................... 31
Section 2.17. Effect of Amendment and Restatement.................. 31
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY.......................... 31
Section 3.1. Taxes................................................. 31
Section 3.2. Illegality............................................ 33
Section 3.3. Increased Costs and Reduction of Return............... 33
Section 3.4. Funding Losses........................................ 34
Section 3.5. Inability to Determine Rates.......................... 35
Section 3.6. Reserves on Offshore Rate Loans....................... 35
Section 3.7. Certificates of Banks................................. 35
Section 3.8. Substitution of Banks for Increased Costs............. 36
Section 3.9. Survival.............................................. 36
ARTICLE IV CONDITIONS PRECEDENT............................................. 36
Section 4.1. Conditions of Initial Loans........................... 36
Section 4.2. Conditions to All Borrowings.......................... 38
ARTICLE V REPRESENTATIONS AND WARRANTIES.................................... 38
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Section 5.1. Corporate Existence and Power. Each Company and
each of its Subsidiaries:................................... 39
Section 5.2. Corporate Authorization; No Contravention............. 39
Section 5.3. Governmental Authorization............................ 39
Section 5.4. Binding Effect........................................ 40
Section 5.5. Litigation............................................ 40
Section 5.6. No Default............................................ 40
Section 5.7. ERISA Compliance...................................... 40
Section 5.8. Use of Proceeds; Margin Regulations................... 41
Section 5.9. Title to Properties................................... 41
Section 5.10. Taxes................................................ 41
Section 5.11. Financial Condition.................................. 42
Section 5.12. Environmental Matters................................ 42
Section 5.13. Regulated Entities................................... 42
Section 5.14. No Burdensome Restrictions........................... 43
Section 5.15. Copyrights, Patents, Trademarks and Licenses, etc.... 43
Section 5.16. Subsidiaries......................................... 43
Section 5.17. Insurance............................................ 43
Section 5.18. Swap Obligations..................................... 43
Section 5.19. Leases............................................... 44
ARTICLE VI AFFIRMATIVE COVENANTS............................................ 44
Section 6.1. Financial Statements.................................. 44
Section 6.2. Certificates; Other Information....................... 45
Section 6.3. Notices............................................... 45
Section 6.4. Preservation of Corporate Existence, Etc.............. 46
Section 6.5. Maintenance of Property............................... 46
Section 6.6. Insurance............................................. 47
Section 6.7. Payment of Obligations................................ 47
Section 6.8. Compliance with Laws.................................. 47
Section 6.9. Compliance with ERISA................................. 48
Section 6.10. Inspection of Property and Books and Records......... 48
Section 6.11. Environmental Laws................................... 48
Section 6.12. Use of Proceeds...................................... 48
Section 6.13. Additional Subsidiary Guarantors..................... 48
Section 6.14. Continuing Nature of Representations and Warranties.. 49
ARTICLE VII NEGATIVE COVENANTS.............................................. 49
Section 7.1. Limitation on Liens................................... 49
Section 7.2. Disposition of Assets................................. 51
Section 7.3. Consolidations and Mergers............................ 51
Section 7.4. Loans and Investments................................. 52
Section 7.5. Limitation on Indebtedness............................ 53
Section 7.6. Transactions with Affiliates.......................... 54
Section 7.7. Use of Proceeds....................................... 54
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Section 7.8. Contingent Obligations................................ 54
Section 7.9. Joint Ventures........................................ 55
Section 7.10. Lease Obligations.................................... 55
Section 7.11. Restricted Payments.................................. 55
Section 7.12. ERISA................................................ 56
Section 7.13. Change in Business................................... 56
Section 7.14. Accounting Changes................................... 56
Section 7.15. Consolidated Tangible Net Worth...................... 56
Section 7.16. Total Funded Debt to EBITDA.......................... 56
Section 7.17. Interest Coverage Ratio.............................. 57
Section 7.18. Obligations under Financial Services Agreements...... 57
Section 7.19. Subsidiaries......................................... 57
ARTICLE VIII EVENTS OF DEFAULT.............................................. 57
Section 8.1. Event of Default...................................... 57
Section 8.2. Remedies.............................................. 60
Section 8.3. Rights Not Exclusive.................................. 60
ARTICLE IX THE AGENT........................................................ 61
Section 9.1. Appointment and Authorization; "Agent"................ 61
Section 9.2. Delegation of Duties.................................. 61
Section 9.3. Liability of Agent.................................... 61
Section 9.4. Reliance by Agent..................................... 62
Section 9.5. Notice of Default..................................... 62
Section 9.6. Credit and Legal Decision............................. 63
Section 9.7. Indemnification of Agent.............................. 63
Section 9.8. Agent in Individual Capacity.......................... 64
Section 9.9. Successor Agent....................................... 64
Section 9.10. Withholding Tax...................................... 64
ARTICLE X MISCELLANEOUS..................................................... 66
Section 10.1. Amendments and Waivers............................... 66
Section 10.2. Notices.............................................. 67
Section 10.3. No Waiver; Cumulative Remedies....................... 67
Section 10.4. Costs and Expenses................................... 68
Section 10.5. Company Indemnification.............................. 68
Section 10.6. Marshalling; Payments Set Aside...................... 69
Section 10.7. Successors and Assigns............................... 69
Section 10.8. Assignments, Participations, etc..................... 69
Section 10.9. Substitution of Banks for Bank Acquisition........... 71
Section 10.10. Confidentiality..................................... 71
Section 10.11. Set-off............................................. 72
Section 10.12. Debits of Fees...................................... 72
Section 10.13. Notification of Addresses, Lending Offices, Etc..... 72
Section 10.14. Counterparts........................................ 72
Section 10.15. Severability........................................ 73
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Section 10.16. No Third Parties Benefited.......................... 73
Section 10.17. Governing Law and Jurisdiction...................... 73
Section 10.18. Waiver of Jury Trial................................ 73
Section 10.19. Judgment............................................ 74
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AMENDED AND RESTATED
MULTICURRENCY CREDIT AGREEMENT
This AMENDED AND RESTATED MULTICURRENCY CREDIT AGREEMENT is entered
into as of March 6, 1998, among C.P. Clare Corporation, a Massachusetts
corporation ("Clare"), C.P. Clare N.V., a Belgian corporation ("C.P. Clare
N.V."), the several financial institutions from time to time party to this
Agreement (collectively, the "Banks"; individually, a "Bank"), and Bank of
America National Trust and Savings Association, as agent for the Banks.
WHEREAS, Clare, C.P. Clare N.V. and the Banks were parties to a
Multicurrency Credit Agreement dated as of September 11, 1995 (as amended,
supplemented or otherwise modified to the date hereof, the "Original Credit
Agreement"), pursuant to which the Banks extended a revolving multicurrency
credit facility to Clare and C.P. Clare N.V.;
WHEREAS, Clare and C.P. Clare N.V. desire that the Banks amend and
restate the Original Credit Agreement to, among other things, increase the
Commitment of the Banks;
WHEREAS, the Banks have agreed to make available to the Companies a
revolving multicurrency credit facility upon the terms and conditions set forth
in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Certain Defined Terms.
The following terms have the following meanings:
"Acquisition" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of fifty percent (50%) of
the capital stock, partnership interests, membership interests or equity of any
Person, or otherwise causing any Person to become a Subsidiary, or (c) a merger
or consolidation or any other combination with another Person (other than a
Person that is a Subsidiary) provided that a Company or a Subsidiary is the
surviving entity.
"Affected Bank" means any Bank that (a) has made a request for
compensation from a Company pursuant to Section 3.3 or (b) is subject to a Bank
Acquisition.
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"Affiliate" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"Agent" means BofA in its capacity as agent for the Banks hereunder,
and any successor agent arising under Section 9.9.
"Agent-Related Persons" means BofA and any successor agent arising
under Section 9.9, together with their respective Affiliates, and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agent's Payment Office" means (i) in respect of payments in Dollars,
the address for payments set forth on Schedule 10.2 or such other address as the
Agent may from time to time specify in accordance with Section 10.2, and, (ii)
in the case of payments in any Offshore Currency, the address for payments set
forth on Schedule 10.2 or such other address as the Agent may from time to time
specify in accordance with Section 10.2.
"Agreed Alternative Currency" has the meaning specified in subsection
2.5(e).
"Agreement" means this Multicurrency Credit Agreement.
"Applicable Currency" means, as to any particular payment or Loan,
Dollars or the Offshore Currency in which it is denominated or is payable.
"Applicable Margin" means, at any time, with respect to the unpaid
principal amount of each Offshore Rate Loan, the applicable percentage set forth
below in the column entitled "Applicable Margin for Offshore Rate Loans"
opposite the Margin Ratio in effect at such time.
Applicable Margin For
Margin Ratio Offshore Rate Loans
------------ -------------------
Less than 0.5:1.0 .25%
Equal to or greater than 0.5:1.0 but .50%
less than 1.0:1.0
Equal to or greater than 1.0:1.0 but .75%
less than 1.5:1.0
Equal to or greater than 1.5:1.0 but 1.00%
less than 2.0:1.0
Equal to or greater than 2.0:1.0 1.25%
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The initial Applicable Margin for Offshore Rate Loans shall be one
percent (1%) and shall remain in effect until the delivery of a Compliance
Certificate with respect to the fiscal quarter ending March 31, 1998.
Thereafter, the Applicable Margin shall be based on the Margin Ratio in effect
as set forth in the Compliance Certificate most recently delivered by Clare to
the Agent. Changes in the Applicable Margin resulting from a change in the
Margin Ratio shall become effective on the first day following the month after
delivery by Clare to Agent of a Compliance Certificate, regardless of whether or
not such certificate is delivered on time. If Clare shall fail to deliver a
Compliance Certificate by the date required pursuant to subsection 6.2(b), the
Applicable Margin from and including the 45th day after the end of such fiscal
quarter to but not including the date Clare delivers to the Agent a Compliance
Certificate shall conclusively be presumed to equal the highest Applicable
Margin specified in the above chart. Notwithstanding the foregoing, no reduction
in the Applicable Margin shall be effected if a Default shall have occurred and
be continuing on the date when such change would otherwise occur. "Margin Ratio"
means, the ratio of Consolidated Liabilities to EBITDA for any twelve-month
period ending on the last day of the fiscal quarter of Clare, as shown in the
most recent Compliance Certificate.
"Assignee" has the meaning specified in subsection 10.8(a).
"Attorney Costs" means and includes all disbursements and reasonable
fees of any law firm or other external counsel, the allocated cost of internal
legal services and all disbursements of internal counsel relating to the Loans,
this Agreement or the other Loan Documents, which services and disbursements
shall be documented to the Companies.
"Bank" has the meaning specified in the introductory clause hereto.
"Bank Acquisition" means the acquisition, whether by purchase, merger
or any other means, of a controlling interest in any Bank by any Person not an
Affiliate of such Bank.
"Banking Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in Chicago, Illinois or San Francisco, California are
authorized or required by law to close and (i) with respect to disbursements and
payments in Dollars, a day on which dealings are carried on in the applicable
offshore Dollar interbank market, and (ii) with respect to any disbursements and
payments in and calculations pertaining to any Offshore Currency Loan, a day on
which commercial banks are open for foreign exchange business in London,
England, and on which dealings in the relevant Offshore Currency are carried on
in the applicable offshore foreign exchange interbank market in which
disbursement of or payment in such Offshore Currency will be made or received
hereunder.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101, et seq.).
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"Base Rate" means, for any day, the higher of:
(a) one half of one percent (0.50%) per annum above the latest
Federal Funds Rate; and (b) the rate of interest in effect for such day as
publicly announced from time to time by BofA in San Francisco, California, as
its "reference rate." (The "reference rate" is a rate set by BofA based upon
various factors including BofA'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 the reference rate announced by BofA shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"BofA" means Bank of America National Trust and Savings Association, a
national banking association, formerly known as Bank of America Illinois, an
Illinois banking corporation.
"Borrowing" means a borrowing hereunder consisting of Loans of the same
Type and in the same Applicable Currency made to a Company on the same day by
the Banks under Article II (but excluding Section 2.1(b)), and, other than in
the case of Base Rate Loans, having the same Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.3.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in Chicago, Illinois or San Francisco, California are
authorized or required by law to close and, if the applicable Business Day
relates to any Offshore Rate Loan, means a Banking Day.
"C.P. Clare N.V." has the meaning specified in the introductory clause
hereto.
"Capital Adequacy Regulation" means any guideline, request or directive
of any central bank or other Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each case, regarding
capital adequacy of any bank or of any corporation controlling a bank.
"Capital Expenditures" means, for any period and with respect to any
Person, the aggregate of all expenditures by such Person and its Subsidiaries
for the acquisition or leasing of fixed or capital assets (excluding operating
leases) or additions to equipment (including replacements, capitalized repairs
and improvements during such period) which should be capitalized under GAAP on a
consolidated balance sheet of such Person and its Subsidiaries.
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"Cash Equivalents" means:
(a) securities issued or fully guaranteed or insured by the United
States Government or any agency thereof and backed by the full faith and credit
of the United States having maturities of not more than six months from the date
of acquisition;
(b) certificates of deposit, time deposits, eurodollar time
deposits, repurchase agreements, reverse repurchase agreements, or bankers'
acceptances, having in each case a tenor of not more than six months, issued by
any Bank, or by any U.S. commercial bank or any branch or agency of a non-U.S.
bank licensed to conduct business in the U.S. having combined capital and
surplus of not less than One Hundred Million Dollars ($100,000,000) whose short
term securities are rated at least A-1 by Standard & Poor's Corporation and P-1
by ▇▇▇▇▇'▇ Investors Service, Inc., and not subject to any right of setoff by
such issuer;
(c) commercial paper of an issuer rated at least A-1 by Standard &
Poor's Corporation or P-1 by ▇▇▇▇▇'▇ Investors Service Inc. and in either case
having a tenor of not more than six months;
(d) investments with foreign banks similar to the investments set
forth in clauses (a), (b) and (c) above, so long as such foreign bank has
combined capital and surplus in excess of One Hundred Million Dollars
($100,000,000); and
(e) variable rate municipal bonds that are backed by letters of
credit issued by any Bank, or by any U.S. commercial bank or any branch or
agency of a non-U.S. bank licensed to conduct business in the U.S. having
combined capital and surplus of not less than One Hundred Million Dollars
($100,000,000) whose short term securities are rated at least A-1 by Standard &
Poor's Corporation and P-1 by ▇▇▇▇▇'▇ Investors Service, Inc.
"Change of Control" means either of the following (i) if any "person"
as such term is used in Sections 13(d) and 14(d) of the Exchange Act, is or
becomes directly or indirectly, the "beneficial owners," as defined in Rule
13d-3 under the Exchange Act, of securities of Clare that represent twenty-five
percent (25%) or more of the combined voting power of Clare's then outstanding
securities or (ii) during any period of twelve consecutive calendar months,
individuals who at the beginning of such period constituted Clare's board of
directors (together with any new directors whose election by Clare's board of
directors or whose nomination for election by Clare's stockholders was approved
by a vote of at least two-thirds of the directors then still in office who
either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reasons other
than death or disability to constitute a majority of the directors then in
office.
"Clare" has the meaning specified in the introductory clause hereto.
"Closing Date" means the date on which all conditions precedent set
forth in Section 4.1 are satisfied or waived by all Banks.
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"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Commitment", as to each Bank, has the meaning specified in Section
2.1(a).
"Company" means Clare or C.P. Clare N.V., and "Companies" means,
collectively, Clare and C.P. Clare N.V.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Computation Date" has the meaning specified in subsection 2.5(a).
"Consolidated Interest Expense" means, for any period, net consolidated
interest expense for the period for Clare and its Subsidiaries, plus (a) the
portion of the upfront costs and expenses for Swap Contracts (to the extent not
included in net consolidated interest expense) fairly allocated to such Swap
Contracts as expenses for such period, plus (b) fees payable pursuant to the
Loan Documents (to the extent not included in net consolidated interest expense)
during such period, plus (c) the portion of any payments made in respect of
capital leases allocated to interest expense (to the extent not included in net
consolidated interest expense) during such period; all as determined in
accordance with GAAP.
"Consolidated Liabilities" means, as of any date of determination, all
amounts which would, in accordance with GAAP, be included under liabilities on a
consolidated balance sheet of Clare and its Subsidiaries.
"Consolidated Net Worth" means shareholders' equity (excluding treasury
stock) of Clare and its Subsidiaries, on a consolidated basis, as determined in
accordance with GAAP.
"Consolidated Tangible Net Worth" means the Consolidated Net Worth of
Clare and its Subsidiaries less the net book value of all assets of the
Companies and their Subsidiaries, on a consolidated basis, which would be
treated as intangibles under GAAP, including, without limitation, deferred
charges (excluding deferred taxes), franchise rights, non-compete agreements,
research and development costs, goodwill, unamortized debt discounts, patents,
patent applications, trademarks, trade names, copyrights and licenses.
"Contingent Obligation" means, as to any Person, any direct or indirect
liability of that Person, whether or not contingent, with or without recourse,
(a) with respect to any Indebtedness, lease, dividend, letter of credit or other
obligation (the "primary obligations") of another Person (the "primary
obligor"), including any obligation of that Person (i) to purchase, repurchase
or otherwise acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such primary
obligation, or to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance sheet
item, level of income or financial condition of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make
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payment of such primary obligation, or (iv) otherwise to assure or hold harmless
the holder of any such primary obligation against loss in respect thereof (each,
a "Guaranty Obligation"); (b) with respect to any Surety Instrument issued for
the account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments; (c) to purchase any materials, supplies
or other property from, or to obtain the services of, another Person if the
relevant contract or other related document or obligation requires that payment
for such materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or other
property is ever made or tendered, or such services are ever performed or
tendered, or (d) in respect of any Swap Contract. The amount of any Contingent
Obligation shall, in the case of Guaranty Obligations, be deemed equal to the
stated or determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the maximum
reasonably anticipated liability in respect thereof, and in the case of other
Contingent Obligations other than in respect of Swap Contracts, shall be equal
to the maximum reasonably anticipated liability in respect thereof and, in the
case of Contingent Obligations in respect of Swap Contracts, shall be equal to
the Swap Termination Value.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
guaranty, indenture, mortgage, deed of trust or other instrument, document or
agreement to which such Person is a party or by which it or any of its property
is bound.
"Conversion/Continuation Date" means any date on which, under Section
2.4, a Company (a) converts Loans of one Type to another Type, or (b) continues
Loans having Interest Periods expiring on such date as Loans of the same Type,
but with a new Interest Period.
"Default" means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if not cured or otherwise remedied
during such time) constitute an Event of Default.
"Dollar Equivalent" means, at any time, (a) as to any amount
denominated in Dollars, the amount thereof at such time, and (b) as to any
amount denominated in an Offshore Currency, the equivalent amount in Dollars as
determined by the Agent at such time on the basis of the Spot Rate for the
purchase of Dollars with such Offshore Currency on the most recent Computation
Date provided for in subsection 2.5(a).
"Dollars", "dollars" and "$" each mean lawful money of the United
States.
"EBIT" means for any period, for Clare and its Subsidiaries on a
consolidated basis, determined in accordance with GAAP, the sum of (a) the net
income (or net loss) for such period plus (b) Consolidated Interest Expense to
the extent included in the determination of such net income (or loss), plus (c)
provision for taxes to the extent included in the determination of such net
income (or loss); provided, however, that net income (or loss) shall be computed
for these purposes without giving effect to extraordinary losses or
extraordinary gains, determined in accordance with GAAP.
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"EBITDA" mean, for any period, for Clare and its Subsidiaries on a
consolidated basis, determined in accordance with GAAP, the EBIT for such
period, plus all amounts treated as expenses for depreciation and amortization
of intangibles of any kind to the extent such amounts are included in the
determination of net income (or loss) for such period; provided, however, that
such amounts shall be excluded from the calculation of EBITDA to the extent such
amounts were included in the calculation of Consolidated Interest Expense.
"Eligible Assignee" means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least One Hundred Million Dollars ($100,000,000); (b) a
commercial bank organized under the laws of any other country which is a member
of the Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a combined capital and
surplus of at least One Hundred Million Dollars ($100,000,000), provided that
such bank is acting through a branch or agency located in the United States; and
(c) a Person that is primarily engaged in the business of commercial banking and
that is (i) a Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a
Bank is a Subsidiary, or (iii) a Person of which a Bank is a Subsidiary.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or injury
to the environment.
"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with a Company within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes
of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by a Company or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations which is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by a Company or any ERISA Affiliate
from a Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which might reasonably be expected
to constitute grounds under Section 4042 of
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ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under
Title IV of ERISA, other than PBGC premiums due but not delinquent under Section
4007 of ERISA, upon a Company or any ERISA Affiliate.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate".
"Event of Default" means any of the events or circumstances specified
in Section 8.1.
"Exchange Act" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including any
such successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Agent of the rates for the last transaction
in overnight Federal funds arranged prior to 9:00 a.m. (New York City time) on
that day by each of three leading brokers of Federal funds transactions in New
York City selected by the Agent.
"Fee Letter" has the meaning specified in subsection 2.11(a).
"Financial Services Agreements" means trade finance, foreign exchange,
risk management service agreements or other services provided by a Bank, if any,
whether verbal or written, entered into between a Company and a Bank, each such
agreement being in form and substance satisfactory to such Bank in its sole
discretion.
"Foreign Permitted Receivables" shall mean all obligations of any
obligor located outside of the United States (whether now existing or hereafter
arising) under a contract for sale of goods or services by a Company or any
Subsidiary, which shall include any obligation of such obligor (whether now
existing or hereafter arising) to pay interest, finance charges or amounts with
respect thereto.
"FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
"Further Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar charges
(including, without limitation, franchise taxes), and all liabilities with
respect thereto, imposed by any jurisdiction on account of amounts payable or
paid pursuant to Section 3.1, excluding, in the case of each Bank and the
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Agent, respectively, taxes imposed on or measured by its net income by the
United States, any state thereof or any other jurisdiction (or any political
subdivision thereof) under the laws of which such Bank or the Agent, as the case
may be, is organized or maintains a lending office.
"FX Trading Office" means the Foreign Exchange Trading Center, Chicago,
Illinois, of BofA, or such other of BofA's offices as BofA may designate from
time to time.
"GAAP" means generally accepted accounting principles set forth from
time to time 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 agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guarantor" means each Subsidiary of a Company.
"Guaranty Obligation" has the meaning specified in the definition of
"Contingent Obligation."
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business on ordinary terms); (c)
all non-contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all net obligations with respect to Swap Contracts; (e) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses; (f) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to property acquired by the Person (even
though the rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such property); (g) all
obligations with respect to capital leases; (h) all indebtedness referred to in
clauses (a) through (g) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien upon or in property (including accounts and contracts rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness; and (i) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in clauses (a)
through (h) above.
For all purposes of this Agreement, the Indebtedness of any Person
shall include all recourse Indebtedness of any partnership or joint venture or
limited liability company in which such Person is a general partner or a joint
venturer or a member.
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"Indemnified Liabilities" has the meaning specified in Section 10.5.
"Indemnified Person" has the meaning specified in Section 10.5.
"Independent Auditor" has the meaning specified in subsection 6.1(a).
"Insolvency Proceeding" means, with respect to any Person, (a) any
case, action or proceeding with respect to such Person before any court or other
Governmental Authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of debtors, or (b)
any general assignment for the benefit of creditors, composition, marshalling of
assets for creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; undertaken under U.S.
Federal, state or foreign law, including the Bankruptcy Code.
"Interest Coverage Ratio" means, for any period, the ratio of (a) EBIT
for such period plus the aggregate amount of all operating lease payments made
or required to be made by Clare or any of its Subsidiaries for such period; to
(b) Consolidated Interest Expense for such period plus the aggregate amount of
all operating lease payments made or required to be made by Clare or any of its
Subsidiaries for such period.
"Interest Payment Date" means, as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and, as to
any Base Rate Loan, the last Business Day of each calendar month; provided,
however, that if any Interest Period for an Offshore Rate Loan exceeds three
months, the date that falls three months after the beginning of such Interest
Period and after each Interest Payment Date thereafter is also an Interest
Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the Conversion/Continuation
Date on which the Loan is converted into or continued as an Offshore Rate Loan,
and ending on the date one, two, three or six months thereafter (and any other
period that is less than one month and is consented to by the Required Banks in
the given instance) as selected by a Company in its Notice of Borrowing or
Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall be extended to the following
Business Day unless, in the case of an Offshore Rate Loan, the result of such
extension would be to carry such Interest Period into another calendar month, in
which event such Interest Period shall end on the preceding Business Day;
(ii) any Interest Period pertaining to an Offshore Rate Loan that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
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(iii) no Interest Period for any Loan shall extend beyond the
Termination Date.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Joint Venture" means a corporation, partnership, limited liability
company, joint venture or other legal arrangement (whether created by contract
or conducted through a separate legal entity) now or hereafter formed by a
Company or any of its Subsidiaries with another Person in order to conduct a
common venture or enterprise with such Person.
"Lending Office" means, as to any Bank, the office or offices of such
Bank specified as its "Lending Office" or "Domestic Lending Office" or "Offshore
Lending Office", as the case may be, on Schedule 10.2, or such other office or
offices as such Bank may from time to time notify the Companies and the Agent.
"LIBOR" has the meaning specified in the definition of "Offshore Rate".
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising under
or evidenced by any conditional sale or other title retention agreement, the
interest of a lessor under a capital lease, any financing lease having
substantially the same economic effect as any of the foregoing, or the filing of
any financing statement naming the owner of the asset to which such lien relates
as debtor, under the Uniform Commercial Code or any comparable law) and any
contingent or other agreement to provide any of the foregoing, but not including
the interest of a lessor under an operating lease.
"Loan" means an extension of credit by a Bank to a Company under
Article II (but excluding Section 2.1(b)), and may be a Base Rate Loan or an
Offshore Rate Loan (each a "Type" of Loan).
"Loan Documents" means this Agreement, any Notes, the Fee Letter, the
Financial Services Agreements and all other documents delivered to the Agent or
any Bank in connection herewith.
"Margin Ratio" has the meaning specified in the definition of
"Applicable Margin".
"Margin Stock" means "margin stock" as such term is defined in
Regulations G, T, U or X of the FRB.
"Material Adverse Effect" means a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of a Company or the Companies and their
Subsidiaries taken as a whole.
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"Minimum Tranche" means, in respect of Loans comprising part of the
same Borrowing, or to be converted or continued under Section 2.4, (a) in the
case of Base Rate Loans, Two Hundred Fifty Thousand Dollars ($250,000) or any
multiple of Two Hundred Fifty Thousand Dollars ($250,000) in excess thereof, and
(b) in the case of Offshore Rate Loans, the Dollar Equivalent amount of One
Million Dollars ($1,000,000) or any multiple of Five Hundred Thousand Dollars
($500,000) in excess thereof or such other smaller amount as Required Banks may
otherwise agree in their sole discretion.
"Multiemployer Plan" means a "multiemployer plan", within the meaning
of Section 4001(a)(3) of ERISA, to which a Company or any ERISA Affiliate makes,
is making, or is obligated to make contributions or, during the preceding three
calendar years, has made, or been obligated to make, contributions.
"Note" means a promissory note executed by a Company in favor of a Bank
pursuant to subsection 2.2(b), in substantially the form of Exhibit F.
"Notice of Borrowing" means a notice in substantially the form of
Exhibit A.
"Notice of Conversion/Continuation" means a notice in substantially the
form of Exhibit B.
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by a Company to any
Bank, the Agent, or any Indemnified Person, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising, and all Obligations shall be the
joint and several Obligations of the Companies.
"Offshore Currency" means at any time Belgian francs and any Agreed
Alternative Currency.
"Offshore Currency Loan" means any Offshore Rate Loan denominated in an
Offshore Currency.
"Offshore Currency Loan Sublimit" means, as to all Offshore Currencies
in the aggregate, Fifteen Million Dollars ($15,000,000), and, as to any single
Offshore Currency, Fifteen Million Dollars ($15,000,000).
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of interest
per annum (rounded upward to the next 1/16th of 1%) determined by the Agent as
follows:
Offshore Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
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"Eurodollar Reserve Percentage" means for any day for any
Interest Period the maximum reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
(whether or not applicable to any Bank) under regulations issued from
time to time by the FRB for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to Eurocurrency funding (currently referred
to as "Eurocurrency liabilities"); and
"LIBOR" means the rate of interest per annum determined by the
Agent to be the arithmetic mean (rounded upward to the next 1/16th of
1%) of the rates of interest per annum notified to the Agent by each
Reference Bank as the rate of interest at which deposits in the
Applicable Currency in the approximate amount of the amount of the Loan
to be made or continued as, or converted into, an Offshore Rate Loan by
such Reference Bank and having a maturity comparable to such Interest
Period would be offered to major banks in the London interbank market
at their request at approximately 11:00 a.m. (London time) two (2)
Business Days prior to the commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to all
Offshore Rate Loans then outstanding as of the effective date of any
change in the Eurodollar Reserve Percentage.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate, and may be an Offshore Currency Loan or a Loan denominated in
Dollars.
"Organization Documents" means, for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or
instrument relating to the rights of preferred shareholders of such corporation,
any shareholder rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation.
"Original Credit Agreement" has the meaning specified in the
introductory clause hereto.
"Other Taxes" means any present or future stamp, court or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery,
performance, enforcement or registration of, or otherwise with respect to, this
Agreement or any other Loan Documents.
"Overnight Rate" means, for any day, the rate of interest per annum at
which overnight deposits in the Applicable Currency, in an amount approximately
equal to the amount with respect to which such rate is being determined, would
be offered for such day by BofA's London branch to major banks in the London or
other applicable offshore interbank market.
"Participant" has the meaning specified in subsection 10.8(d).
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"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA which a Company sponsors, maintains, or to
which it makes, is making, or is obligated to make contributions, or in the case
of a multiple employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five (5) plan years.
"Permitted Liens" has the meaning specified in Section 7.1.
"Permitted Foreign Receivables Purchase Facility" shall mean any
agreement of a Company or any of its Subsidiaries providing for sales, transfers
or conveyances of Foreign Permitted Receivables purporting to be sales (and
considered sales under GAAP) that do not provide, directly or indirectly, for
recourse against the seller of such Foreign Permitted Receivables (or against
any of such seller's Affiliates) by way of a guaranty or any other support
arrangement, with respect to the amount of such Foreign Permitted Receivables
(based on the financial condition or circumstances of the obligor thereunder),
other than such limited recourse as is reasonable given market standards for
transactions of a similar type, taking into account such factors as historical
bad debt loss experience and obligor concentration levels; provided that the
aggregate amount of all Foreign Permitted Receivables permitted to be sold
pursuant to all Permitted Foreign Receivables Purchase Facilities for the
combined Companies and their Subsidiaries shall not exceed Five Million Dollars
($5,000,000) in any fiscal year of Clare.
"Permitted Swap Obligations" means the Financial Services Agreements
which constitute Swap Contracts and all other obligations (contingent or
otherwise) of a Company or any Subsidiary existing or arising under Swap
Contracts; provided that each of the following criteria is satisfied: (a) such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with (i)
interest rate fluctuations, provided that the aggregate exposure of the
Companies and their Subsidiaries (to be determined by BofA) under Swap Contracts
entered into for the purpose of mitigating risks associated with interest rate
fluctuations does not exceed One Million Dollars ($1,000,000) and the aggregate
notional amount of all such Swap Contracts does not exceed Twenty Million
Dollars ($20,000,000) or (ii) exchange rate fluctuations, provided that the
aggregate exposure of the Companies and their Subsidiaries (to be determined by
BofA) under Swap Contracts entered into for the purpose of mitigating risks
associated with exchange rate fluctuations does not exceed Four Million Dollars
($4,000,000) and the aggregate notional amount of all such Swap Contracts does
not exceed Forty Million Dollars ($40,000,000), (b) such obligations are (or
were) entered into by such Person in the ordinary course of business for the
purpose of directly mitigating risks associated with liabilities, commitments or
assets held by such Person; and (c) such Swap Contracts do not contain (i) any
provision ("walk-away" provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the defaulting party,
or (ii) any provision creating or permitting the
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declaration of an event of default, termination event or similar event upon the
occurrence of an Event of Default hereunder.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which a Company sponsors or maintains or to which a Company makes, is
making, or is obligated to make contributions and includes any Pension Plan.
"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Bank's Commitment divided by the combined Commitments of all Banks.
"Reference Banks" means BofA and such other financial institutions as
are acceptable to Agent.
"Replacement Bank" means any bank or financial institution reasonably
satisfactory to the Company which acquires and assumes all or a ratable part of
all of an Affected Banks Loans and Commitments.
"Reportable Event" means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such event for
which the thirty (30) day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
"Required Banks" means at any time Banks then holding at least 66.667%
of the then aggregate unpaid principal amount of the Loans, or, if no amounts
are outstanding, Banks then having at least 66.667% of the aggregate amount of
the Commitments; provided that "Required Banks" shall at all times include BofA.
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
"Responsible Officer" means the chief executive officer or the
president of a Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with financial
covenants, the chief financial officer or the treasurer of a Company, or any
other officer having substantially the same authority and responsibility.
"Same Day Funds" means (i) with respect to disbursements and payments
in Dollars, immediately available funds, and (ii) with respect to disbursements
and payments in an Offshore Currency, same day or other funds as may be
determined by the Agent to be customary in the place of disbursement or payment
for the settlement of international banking transactions in the relevant
Offshore Currency.
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"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Spot Rate" for a currency means the rate quoted by BofA as the spot
rate for the purchase by BofA of such currency with another currency through its
FX Trading Office at approximately 10:30 a.m. (Chicago time) on the date two (2)
Banking Days prior to the date as of which the foreign exchange computation is
made.
"Subordinated Debt" means that portion of any liabilities, obligations
or Indebtedness of either Company or any Subsidiary that is subordinated to the
Obligations in a manner satisfactory to Banks.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business entity
of which more than fifty percent (50%) of the voting stock, membership interests
or other equity interests (in the case of Persons other than corporations), is
owned or controlled directly or indirectly by the Person, or one or more of the
Subsidiaries of the Person, or a combination thereof. Unless the context
otherwise clearly requires, references herein to a "Subsidiary" refer to a
direct or indirect Subsidiary of a Company and includes, without limitation, all
Persons listed on the organizational chart attached as Schedule 1.1.
"Surety Instruments" means all letters of credit (including standby and
commercial), banker's acceptances, bank guaranties, shipside bonds, surety bonds
and similar instruments.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap or
option, bond, note or ▇▇▇▇ option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
▇▇▇▇-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Bank.)
"Taxes" means any and all present or future taxes, levies, assessments,
imposts, duties, deductions, fees, withholdings or similar charges, and all
liabilities with respect thereto, excluding, in the case of each Bank and the
Agent, respectively, taxes imposed on or measured
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by its net income by the United States, any state thereof or any other
jurisdiction (or any political subdivision thereof) under the laws of which such
Bank or the Agent, as the case may be, is organized or maintains a lending
office.
"Termination Date" means the earlier to occur of:
(a) June 30, 2001; and
(b) the date on which the Commitments terminate in accordance with
the provisions of this Agreement.
"Total Funded Debt" means at any time, the aggregate outstanding amount
of all interest-bearing Indebtedness at such time determined for the Companies
and their Subsidiaries on a consolidated basis in accordance with GAAP,
including without limitation, the Loans.
"Type" has the meaning specified in the definition of "Loan."
"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Plan's assets, determined in accordance with the assumptions used for funding
the Pension Plan pursuant to Section 412 of the Code for the applicable plan
year.
"United States" and "U.S." each means the United States of America.
"Wholly-Owned Subsidiary" means any Subsidiary in which (other than
directors' qualifying shares required by law) one hundred percent (100%) of the
capital stock, or memberships or other equity interests in the case of
Subsidiaries that are not corporations, of each class having ordinary voting
power, and one hundred percent (100%) of the capital stock, or memberships or
other equity interests in the case of Subsidiaries that are not corporations, of
every other class, in each case, at the time as of which any determination is
being made, is owned, beneficially and of record, by a Company, or by one or
more of the other Wholly-Owned Subsidiaries, or both.
Section 1.2. Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means
"including without limitation."
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(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including"; the words "to" and "until" each mean "to but
excluding", and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms. Unless otherwise expressly
provided, any reference to any action of the Agent or the Banks by way of
consent, approval or waiver shall be deemed modified by the phrase "in its/their
sole discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Companies
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Banks or the Agent merely because of the
Agent's or Banks' involvement in their preparation.
Section 1.3. Accounting Principles.
(a) Unless the context otherwise clearly requires, all accounting
terms not expressly defined herein shall be construed, and all financial
computations required under this Agreement shall be made, in accordance with
GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter" refer
to such fiscal periods of a Company.
Section 1.4. Currency Equivalents Generally.
For all purposes of this Agreement (but not for purposes of the
preparation of any financial statements delivered pursuant hereto), the
equivalent in any Offshore Currency or other currency of an amount in Dollars,
and the equivalent in Dollars of an amount in any Offshore Currency or other
currency, shall be determined at the Spot Rate.
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ARTICLE II
THE CREDITS
Section 2.1. Amounts and Terms of Commitments.
(a) The Revolving Credit. Each Bank severally agrees, on the terms
and conditions set forth herein, to make Loans to the Companies from time to
time on any Business Day for the period from the Closing Date to the Termination
Date, in an aggregate principal Dollar Equivalent amount for the combined
Companies not to exceed at any time outstanding the amount set forth opposite
the Bank's name in Schedule 2.1 under the heading "Commitment" (such amount as
the same may be reduced pursuant to Section 2.6 or as a result of one or more
assignments pursuant to Section 10.8, the Bank's "Commitment"); provided,
however, that after giving effect to any Borrowing of Loans, the aggregate
principal Dollar Equivalent amount of all outstanding Loans shall not exceed the
combined Commitments of all Banks; and provided further, that after giving
effect to any Borrowing of Offshore Currency Loans, the aggregate principal
Dollar Equivalent amount of all outstanding Offshore Currency Loans shall not
exceed the Offshore Currency Loan Sublimit. Within the limits of each Bank's
Commitment, and subject to the other terms and conditions hereof, the Companies
may borrow under this subsection 2.1(a), repay such Borrowings pursuant to
Section 2.7 and reborrow pursuant to this subsection 2.1(a).
(b) Financial Services. Each Bank severally agrees, from time to
time on any Business Day during any period determined by each Bank in its sole
discretion, to provide the financial services to each Company set forth in the
Financial Services Agreements between Bank and such Company; provided that the
aggregate Dollar Equivalent amount of exposure of such Bank under the Financial
Services Agreements to which it is a party, as determined by such Bank in its
sole discretion, does not at any time exceed the amount set forth opposite the
Bank's name in Schedule 2.1 under the heading "Financial Services (Excluding
Loans)".
Section 2.2. Loan Accounts.
(a) The Loans made by each Bank shall be evidenced by one or more
loan accounts or records maintained by such Bank in the ordinary course of
business. The loan accounts or records maintained by the Agent and each Bank
shall be conclusive absent manifest error of the amount of the Loans made by the
Banks to a Company and the interest and payments thereon. Any failure so to
record or any error in doing so shall not, however, limit or otherwise affect
the obligation of the Companies hereunder to pay any amount actually owing with
respect to the Loans.
(b) The Loans made by such Bank shall be evidenced by one or more
Notes, in addition to the loan accounts. Each such Bank shall endorse on the
schedules annexed to its Note(s) the date, amount and maturity of each Loan made
by it and the amount and Applicable Currency of each payment of principal made
by a Company with respect thereto. Each such Bank is irrevocably authorized by
each Company to endorse its Note(s) and each Bank's record shall be conclusive
absent manifest error; provided, however, that the failure of a Bank to make, or
an error in making, a notation thereon with respect to any Loan shall not limit
or
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otherwise affect the obligations of the Companies hereunder or under any such
Note to such Bank.
Section 2.3. Procedure for Borrowing
(a) Subject to subsection 2.3(e) each Borrowing shall be made upon
a Company's irrevocable written notice delivered to the Agent in the form of a
Notice of Borrowing (which notice must be received by the Agent prior to 10:00
a.m. (Chicago time) (i) four (4) Business Days prior to the requested Borrowing
Date, in the case of Offshore Currency Loans; (ii) three (3) Business Days prior
to the requested Borrowing Date, in the case of Offshore Rate Loans denominated
in Dollars; and (iii) on the requested Borrowing Date, in the case of Base Rate
Loans, specifying:
(A) the amount of the Borrowing, which shall be in an
aggregate amount not less than the Minimum Tranche;
(B) the requested Borrowing Date, which shall be a
Business Day;
(C) the name of the Company proposing to borrow and the
Type of Loans comprising the Borrowing;
(D) the duration of the Interest Period applicable to
such Loans included in such notice. If the Notice of Borrowing fails to
specify the duration of the Interest Period for any Borrowing comprised
of Offshore Rate Loans, such Interest Period shall be three months; and
(E) in the case of a Borrowing comprised of Offshore
Currency Loans, the Applicable Currency.
(b) The Dollar Equivalent amount of any Borrowing in an Offshore
Currency will be determined by the Agent for such Borrowing on the Computation
Date therefor in accordance with subsection 2.5(a). Upon receipt of the Notice
of Borrowing, the Agent will promptly notify each Bank thereof and of the amount
of such Bank's Pro Rata Share of the Borrowing. In the case of a Borrowing
comprised of Offshore Currency Loans, such notice will provide the amount of
each Bank's Pro Rata Share of the Borrowing, and the Agent will, upon the
determination of Dollar Equivalent amount of the Borrowing as specified in the
Notice of Borrowing, promptly notify each Bank of the exact amount of such
Bank's Pro Rata Share of the Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company requesting such
Borrowing at the Agent's Payment Office by 12:00 noon (Chicago time) on the
Borrowing Date requested by such Company in Same Day Funds and in the requested
currency (i) in the case of a Borrowing comprised of Loans in Dollars, by 12:00
noon (Chicago time), (ii) in the case of a Borrowing in Offshore Currency, by
such time as the Agent may specify. The proceeds of all such Loans
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will then be made available to such Company by the Agent by wire transfer in
accordance with written instructions provided to the Agent by such Company of
like funds as received by the Agent.
(d) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than five (5) different Interest
Periods in effect.
(e) During the existence of a Default or Event of Default a
Company may not elect a Loan to be an Offshore Rate Loan.
Section 2.4. Conversion and Continuation Elections.
(a) Subject to subsection 2.4(e) a Company may, upon irrevocable
written notice to the Agent in accordance with subsection 2.4(b):
(i) elect, as of any Business Day, in the case of Base
Rate Loans, or as of the last day of the applicable Interest Period, in
the case of any other Type of Loans denominated in Dollars, to convert
any such Loans (or any part thereof in an amount not less than the
Minimum Tranche) into Loans in Dollars of any other Type; or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any Loans having Interest Periods expiring on such
day (or any part thereof in an amount not less than the Minimum
Tranche);
provided, that if at any time the aggregate amount of Offshore Rate Loans
denominated in Dollars in respect of any Borrowing is reduced, by payment,
prepayment, or conversion of part thereof to be less than One Million Dollars
($1,000,000), such Offshore Rate Loans shall automatically convert into Base
Rate Loans, and on and after such date the right of such Company to continue
such Loans as, and convert such Loans into, Offshore Rate Loans shall terminate.
(b) A Company shall deliver a Notice of Conversion/Continuation to
be received by the Agent not later than 10:00 a.m. (Chicago time) at least (i)
three (3) Business Days in advance of the Conversion/Continuation Date, if the
Loans are to be converted into or continued as Offshore Rate Loans denominated
in Dollars; (ii) four (4) Business Days in advance of the continuation date, if
the Loans are to be continued as Offshore Currency Loans; and (iii) on the
Conversion/Continuation Date, if the Loans are to be converted into Base Rate
Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
continued;
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(C) the Type of Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans in Dollars, a Company has failed to select timely a new
Interest Period to be applicable to such Offshore Rate Loans, or if any Default
or Event of Default then exists, such Company shall be deemed to have elected to
convert such Offshore Rate Loans into Base Rate Loans effective as of the
expiration date of such Interest Period. If a Company has failed to select a new
Interest Period to be applicable to Offshore Currency Loans prior to the fourth
Business Day in advance of the expiration date of the current Interest Period
applicable thereto as provided in subsection 2.4(b), or if any Default or Event
of Default shall then exist, subject to the provisions of subsection 2.5(d),
such Company shall be deemed to have elected to continue such Offshore Currency
Loans on the basis of a one-month Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by a
Company, the Agent will promptly notify each Bank of the details of any
automatic conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Loans with
respect to which the notice was given held by each Bank.
(e) During the existence of a Default or Event of Default, a
Company may not elect to have a Loan in Dollars converted into or continued as
an Offshore Rate Loan in Dollars or elect to have an Offshore Currency Loan
continued on the basis of an Interest period exceeding one month.
(f) After giving effect to any conversion or continuation of
Loans, unless the Agent shall otherwise consent, there may not be more than five
(5) different Interest Periods in effect.
Section 2.5. Utilization of Commitments in Offshore Currencies.
(a) The Agent will determine the Dollar Equivalent amount with
respect to any (i) Borrowing comprised of Offshore Currency Loans as of the
requested Borrowing Date, (ii) outstanding Offshore Currency Loans as of the
last Banking Day of each month, and (iii) outstanding Offshore Currency Loans as
of any redenomination date pursuant to this Section 2.5 or Section 3.5 (each
such date under clauses (i) through (iii) a "Computation Date").
(b) In the case of a proposed Borrowing comprised of Offshore
Currency Loans, the Banks shall be under no obligation to make Offshore Currency
Loans in the requested Offshore Currency as part of such Borrowing if the Agent
has received notice from any of the Banks by 5:00 p.m. (Chicago time) four (4)
Business Days prior to the day of such Borrowing that such Bank cannot provide
Loans in the requested Offshore Currency, in which event the Agent will give
notice to such Company no later than 9:00 a.m. (Chicago time) on the
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third Business Day prior to the requested date of such Borrowing that the
Borrowing in the requested Offshore Currency is not then available, and notice
thereof also will be given promptly by the Agent to the Banks. If the Agent
shall have so notified such Company that any such Borrowing in a requested
Offshore Currency is not then available, such Company may, by notice to the
Agent not later than 5:00 p.m. (Chicago time) three (3) Business Days prior to
the requested date of such Borrowing, withdraw the Notice of Borrowing relating
to such requested Borrowing. If such Company does so withdraw such Notice of
Borrowing, the Borrowing requested therein shall not occur and the Agent will
promptly so notify each Bank. If such Company does not so withdraw such Notice
of Borrowing, the Agent will promptly so notify each Bank and such Notice of
Borrowing shall be deemed to be a Notice of Borrowing that requests a Borrowing
comprised of Base Rate Loans in an aggregate amount equal to the amount of the
originally requested Borrowing as expressed in the Dollar Equivalent of the
amount specified in the Notice of Borrowing; and in such notice by the Agent to
each Bank the Agent will state such aggregate amount of such Borrowing in
Dollars and such Bank's Pro Rata Share thereof.
(c) In the case of a proposed continuation of Offshore Currency
Loans for an additional Interest Period pursuant to Section 2.4, the Banks shall
be under no obligation to continue such Offshore Currency Loans if the Agent has
received notice from any of the Banks by 5:00 p.m. (Chicago time) four (4)
Business Days prior to the day of such continuation that such Bank cannot
continue to provide Loans in the relevant Offshore Currency, in which event the
Agent will give notice to such Company not later than 9:00 a.m. (Chicago time)
on the third Business Day prior to the requested date of such continuation that
the continuation of such Offshore Currency Loans in the relevant Offshore
Currency is not then available, and notice thereof also will be given promptly
by the Agent to the Banks. If the Agent shall have so notified such Company that
any such continuation of Offshore Currency Loans is not then available, any
Notice of Continuation/Conversion with respect thereto shall be deemed withdrawn
and such Offshore Currency Loans shall be redenominated into Base Rate Loans in
Dollars with effect from the last day of the Interest Period with respect to any
such Offshore Currency Loans. The Agent will promptly notify such Company and
the Banks of any such redenomination and in such notice by the Agent to each
Bank the Agent will state the aggregate Dollar Equivalent amount of the
redenominated Offshore Currency Loans as of the Computation Date with respect
thereto and such Bank's Pro Rata Share thereof.
(d) Notwithstanding anything herein to the contrary, during the
existence of a Default or an Event of Default, upon the request of the Required
Banks, all or any part of any outstanding Offshore Currency Loans shall be
redenominated and converted into Base Rate Loans in Dollars on the last day of
the Interest Period with respect to any such Offshore Currency Loans. The Agent
will promptly notify such Company of any such redenomination and conversion
request.
(e) A Company shall be entitled to request that Loans hereunder
also be permitted to be made in any other lawful currency constituting a
eurocurrency (other than Dollars), in addition to the eurocurrencies specified
in the definition of "Offshore Currency" herein, that in the opinion of all the
Banks is at such time freely traded in the offshore interbank
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foreign exchange markets and is freely transferable and freely convertible into
Dollars (an "Agreed Alternative Currency"). A Company shall deliver to the Agent
any request for designation of an Agreed Alternative Currency in accordance with
Section 10.2, to be received by the Agent not later than 10:00 a.m. (Chicago
time) at least seven (7) Business Days in advance of the date of any Borrowing
hereunder proposed to be made in such Agreed Alternative Currency. Upon receipt
of any such request the Agent will promptly notify the Banks thereof. Each Bank
may grant or accept such request in its sole discretion. The Agent will promptly
notify such Company of the acceptance or rejection of any such request.
Section 2.6. Voluntary Termination or Reduction of Commitments.
A Company may, upon not less than five (5) Business Days' prior notice
to the Agent, terminate the Commitments, or permanently reduce the Commitments
by an aggregate minimum Dollar Equivalent amount of One Million Dollars
($1,000,000) or any Dollar Equivalent multiple of One Million Dollars
($1,000,000) in excess thereof; unless, after giving effect thereto and to any
payments of Loans made on the effective date thereof, the then-outstanding
principal Dollar Equivalent amount of the Loans would exceed the amount of the
combined Commitments then in effect. Once reduced in accordance with this
Section, the Commitments may not be increased. Any reduction of the Commitments
shall be applied to each Bank according to its Pro Rata Share. All accrued
commitment fees to, but not including the effective date of any reduction or
termination of Commitments, shall be paid on the effective date of such
reduction or termination.
Section 2.7. Optional Repayments.
Subject to Section 3.4, a Company may, at any time or from time to
time, upon irrevocable notice to the Agent delivered in accordance with Section
10.2 and the notice provisions below, ratably repay Loans in whole or in part,
in minimum Dollar Equivalent amounts of Two Hundred Thousand Dollars ($200,000)
or any Dollar Equivalent multiple of One Hundred Thousand Dollars ($100,000) in
excess thereof. The repaying Company shall deliver a notice of repayment to be
received by the Agent not later than 10:00 a.m. (Chicago time) (i) at least
three (3) Business Days in advance of the repayment date if the Loans to be
repaid are Offshore Currency Loans, (ii) at least three (3) Business Days in
advance of the repayment date if the Loans to be repaid are Offshore Rate Loans
in Dollars, and (iii) on the repayment date if the Loans to be repaid are Base
Rate Loans. Such notice of repayment shall specify the date and amount of such
repayment and whether such repayment is of Base Rate Loans, Offshore Rate Loans,
or any combination thereof, and the Applicable Currency. Such notice shall not
thereafter be revocable by such Company and the Agent will promptly notify each
Bank thereof and of such Bank's Pro Rata Share of such repayment. The payment
amount specified in such notice shall be due and payable on the date specified
therein, together with accrued interest to each such date on the amount repaid
and any amounts required pursuant to Section 3.4.
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Section 2.8. Currency Exchange Fluctuations.
Subject to Section 3.4, if on any Computation Date the Agent shall have
determined that the aggregate Dollar Equivalent principal amount of all Loans
then outstanding exceeds the combined Commitments of the Banks due to a change
in applicable rates of exchange between Dollars and Offshore Currencies, then
the Agent shall give notice to a Company that a repayment is required under this
Section, and such Company agrees thereupon to make immediate repayments of Loans
such that, after giving effect to such repayment the aggregate Dollar Equivalent
amount of all Loans does not exceed the combined Commitments.
Section 2.9. Repayment.
The Companies, jointly and severally, shall repay to the Banks on the
Termination Date the aggregate principal amount of Loans and all other
Obligations outstanding on such date.
Section 2.10. Interest.
(a) Each Loan shall bear interest on the outstanding principal
amount thereof from the applicable Borrowing Date at a rate per annum equal to
the Offshore Rate plus the Applicable Margin or the Base Rate, as the case may
be (and subject to a Company's right to convert to other Types of Loans under
Section 2.4).
(b) Interest on each Loan shall be paid in arrears on each
Interest Payment Date. Interest shall also be paid on the date of any prepayment
of Loans under Section 2.6 or repayment of Offshore Rate Loans under Sections
2.7 or 2.8 for the portion of the Loans so prepaid or repaid, and upon payment
(including prepayment) in full thereof and, during the existence of any Event of
Default, interest shall be paid on demand of the Agent at the request or with
the consent of the Required Banks.
(c) Notwithstanding subsection (a) of this Section, while any
Event of Default exists or after acceleration, each Company shall pay interest
(after as well as before entry of judgment thereon to the extent permitted by
law) on the principal amount of all outstanding Obligations, at a rate per annum
which is determined by adding two percent (2.0%) per annum to the Applicable
Margin then in effect for such Loans and, in the case of Obligations not subject
to an Applicable Margin, at a rate per annum equal to the interest rate then in
effect for such Obligations (or if no such interest rate exists, the Base Rate)
plus two percent (2.0%); provided, however, that on and after the expiration of
any Interest Period applicable to any Offshore Rate Loan outstanding on the date
of occurrence of such Event of Default or acceleration, the principal amount of
such Loan shall, during the continuation of such Event of Default or after
acceleration, bear interest at a rate per annum equal to the Base Rate plus two
percent (2.0%).
(d) Anything herein to the contrary notwithstanding, the
obligations of a Company to any Bank hereunder shall be subject to the
limitation that payments of interest shall not be required for any period for
which interest is computed hereunder, to the extent (but
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only to the extent) that contracting for or receiving such payment by such Bank
would be contrary to the provisions of any law applicable to such Bank limiting
the highest rate of interest that may be lawfully contracted for, charged or
received by such Bank, and in such event such Company shall pay such Bank
interest at the highest rate permitted by applicable law.
Section 2.11. Fees.
(a) Arrangement, Agency Fees. The Companies shall jointly and
severally be obligated to pay a fee to BofA as required by the letter agreement
("Fee Letter") between the Companies and BofA, which fee shall be due and
payable and fully earned on the Closing Date.
(b) Commitment Fees. The Companies shall jointly and severally,
pay to the Agent for the account of each Bank a commitment fee on the average
daily unused portion of such Bank's Commitment, computed on a monthly basis in
arrears on the last Business Day of each calendar month based upon the daily
utilization for that month as calculated by the Agent, equal to (i) one quarter
of one percent (0.25%) per annum if such average daily unused portion is greater
than fifty percent (50%) of such Bank's Commitment or (ii) one-eighth of one
percent (0.125%) per annum if such average daily unused portion is less than or
equal to fifty percent (50%) of such Bank's Commitment. Such commitment fee
shall accrue from the Closing Date to the Termination Date and shall be due and
payable monthly in arrears on the last Business Day of each month commencing on
March 27, 1998 through the Termination Date, with the final payment to be made
on the Termination Date; provided that, in connection with any reduction or
termination of Commitments under Section 2.6, the accrued commitment fee
calculated for the period ending on such date shall also be paid on the date of
such reduction or termination, with the following monthly payment being
calculated on the basis of the period from such reduction or termination date to
such monthly payment date. The commitment fees provided in this subsection shall
accrue at all times after the above-mentioned commencement date, including at
any time during which one or more conditions in Article IV are not met.
Section 2.12. Computation of Fees and Interest.
(a) All computations of interest for Loans shall be made on the
basis of a year of 360 days and actual days elapsed. Interest and fees shall
accrue during each period during which interest or such fees are computed from
the first day thereof to the last day thereof.
(b) For purposes of determining utilization of each Bank's
Commitment in order to calculate the commitment fee due under Section 2.11(b),
the amount of any outstanding Offshore Currency Loan on any date shall be
determined based upon the Dollar Equivalent amount as of the most recent
Computation Date with respect to such Offshore Currency Loan.
(c) Each determination of an interest rate or a Dollar Equivalent
amount by the Agent shall be conclusive and binding on the Companies and the
Banks in the absence of manifest error. The Agent will, at the request of a
Company or any Bank, deliver to such
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Company or such Bank, as the case may be, a statement showing the quotations
used by the Agent in determining any interest rate or Dollar Equivalent amount.
Section 2.13. Payments by a Company.
(a) All payments to be made by a Company shall be made without
set-off, recoupment or counterclaim and free and clear of and without reduction
by reason of all present and future taxes, levies, imposts, duties or other
charges. Except as otherwise expressly provided herein, all payments by a
Company shall be made to the Agent for the account of the Banks at the Agent's
Payment Office, and, with respect to principal of, interest on, and any other
amounts relating to, any Offshore Currency Loan, shall be made in the Offshore
Currency in which such Loan is denominated or payable, and, with respect to all
other amounts payable hereunder, shall be made in Dollars. Such payments shall
be made in Same Day Funds, and (i) in the case of Offshore Currency payments, no
later than such time on the dates specified herein as may be determined by the
Agent to be necessary for such payment to be credited on such date in accordance
with normal banking procedures in the place of payment, and (ii) in the case of
any Dollar payments, no later than 1:30 p.m. (Chicago time) on the date
specified herein. The Agent will promptly distribute to each Bank its Pro Rata
Share (or other applicable share as expressly provided herein) of such
principal, interest, fees or other amounts, in like funds as received. Any
payment which is received by the Agent later than 1:30 p.m. (Chicago time), or
later than the time specified by the Agent as provided in clause (i) above (in
the case of Offshore Currency payments), shall be deemed to have been received
on the following Business Day and any applicable interest or fee shall continue
to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
(c) Unless the Agent receives notice from a Company prior to the
date on which any payment is due to the Banks that such Company will not make
such payment in full as and when required, the Agent may assume that such
Company has made such payment in full to the Agent on such date in Same Day
Funds and the Agent may (but shall not be required to), in reliance upon such
assumption, distribute to each Bank on such due date an amount equal to the
amount then due such Bank. If and to the extent such Company has not made such
payment in full to the Agent, each Bank shall repay to the Agent on demand such
amount distributed to such Bank, together with interest thereon at the Federal
Funds Rate or, in the case of a payment in an Offshore Currency, the Overnight
Rate, for each day from the date such amount is distributed to such Bank until
the date repaid.
Section 2.14. Payments by the Banks to the Agent.
(a) Unless the Agent receives notice from a Bank on or prior to
the Closing Date or, with respect to any Borrowing after the Closing Date, at
least one (1) Business Day prior to the date of such Borrowing, that such Bank
will not make available as and when required hereunder to the Agent for the
account of the borrowing Company the amount of that
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Bank's Pro Rata Share of the Borrowing, the Agent may assume that each Bank has
made such amount available to the Agent in Same Day Funds on the Borrowing Date
and the Agent may (but shall not be required to), in reliance upon such
assumption, make available to such Company on such date a corresponding amount.
If and to the extent any Bank shall not have made its full amount available to
the Agent in Same Day Funds and the Agent in such circumstances has made
available to such Company such amount, that Bank shall on the Business Day
following such Borrowing Date make such amount available to the Agent, together
with interest at the Federal Funds Rate or, in the case of any Borrowing
consisting of Offshore Currency Loans, the Overnight Rate, for each day during
such period. A notice of the Agent submitted to any Bank with respect to amounts
owing under this subsection 2.14(a) shall be conclusive, absent manifest error.
If such amount is so made available, such payment to the Agent shall constitute
such Bank's Loan on the date of Borrowing for all purposes of this Agreement. If
such amount is not made available to the Agent on the Business Day following the
Borrowing Date, the Agent will notify the Companies of such failure to fund and,
upon demand by the Agent, the Companies shall be jointly and severally obligated
to immediately pay such amount to the Agent for the Agent's account, together
with interest thereon for each day elapsed since the date of such Borrowing, at
a rate per annum equal to the interest rate applicable at the time to the Loans
comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a Loan on
such Borrowing Date, but no Bank shall be responsible for the failure of any
other Bank to make the Loan to be made by such other Bank on any Borrowing Date.
Section 2.15. Sharing of Payments, Etc.
If, other than as expressly provided elsewhere herein, any Bank shall
obtain on account of the Loans made by it any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) in
excess of its ratable share (or other share contemplated hereunder), such Bank
shall immediately (a) notify the Agent of such fact, and (b) purchase from the
other Banks such participations in the Loans made by them as shall be necessary
to cause such purchasing Bank to share the excess payment pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. Each Company agrees
that any Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 10.11) with respect to such
participation as fully as if such Bank were the direct creditor of a Company in
the amount of such participation. The Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Banks following
any such purchases or repayments.
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Section 2.16. Financial Services.
(a) Any liability, whether contingent or otherwise, incurred by a Bank
as a result of financial services provided by such Bank to a Company pursuant to
Section 2.1(b) are solely the liability of such Bank, however, such liabilities
shall constitute a part of the Obligations and consequently shall be entitled to
the benefit of the representations, warranties and covenants set forth herein.
(b) The Agent may, with the consent or upon the request of the Required
Banks, pay to a Bank all or part of the amounts owed by a Company to such Bank
pursuant to the Financial Services Agreements. The amount so paid shall
constitute a Base Rate Loan advanced pursuant to Section 2.1(a) and the Banks
shall account for such payment pursuant to the provisions of Section 2.15.
Section 2.17. Effect of Amendment and Restatement.
Upon the execution and delivery of this Agreement, the liabilities of
the Companies previously governed by the Original Credit Agreement shall
continue in full force and effect, but shall be governed by the terms and
conditions set forth in this Agreement. The execution and delivery of this
agreement shall not constitute a novation or repayment of the indebtedness
outstanding under the Original Credit Agreement.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
Section 3.1. Taxes.
(a) Any and all payments by a Company to each Bank or the Agent under
this Agreement and any other Loan Document shall be made free and clear of, and
without deduction or withholding for, any Taxes. In addition, the Companies
shall be jointly and severally obligated to promptly pay all Other Taxes.
(b) If a Company shall be required by law to deduct or withhold any
Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Bank or the Agent, then:
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section), such Bank or the Agent, as the case may be, receives and
retains an amount equal to the sum it would have received and retained
had no such deductions or withholdings been made;
(ii) such Company shall make such deductions and withholdings;
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(iii) such Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Companies shall also be jointly and severally
obligated to promptly pay to each Bank or the Agent for the account of
such Bank, at the time interest is paid, Further Taxes in the amount
that the respective Bank specifies as necessary to preserve the
after-tax yield the Bank would have received if such Taxes, Other Taxes
or Further Taxes had not been imposed.
(c) The Companies jointly and severally agree to indemnify and hold
harmless each Bank and the Agent for the full amount of i) Taxes, ii) Other
Taxes, and iii) Further Taxes in the amount that the respective Bank specifies
as necessary to preserve the after-tax yield the Bank would have received if
such Taxes, Other Taxes or Further Taxes had not been imposed, and any liability
(including penalties, interest, additions to tax and expenses, unless incurred
solely by reason of such Bank's gross negligence or willful misconduct) arising
therefrom or with respect thereto, whether or not such Taxes, Other Taxes or
Further Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within thirty (30) days after the date the Bank or
the Agent makes written demand therefor.
(d) Within thirty (30) days after the date of any payment by a Company
of Taxes, Other Taxes or Further Taxes, such Company shall furnish to each Bank
or the Agent the original or a certified copy of a receipt evidencing payment
thereof, or other evidence of payment satisfactory to such Bank or the Agent.
(e) If a Company is required to pay any amount to any Bank or the Agent
pursuant to subsection (b) or (c) of this Section, then such Bank shall use
reasonable efforts (consistent with legal and regulatory restrictions) to change
the jurisdiction of its Lending Office so as to eliminate any such additional
payment by such Company which may thereafter accrue, if such change in the sole
judgment of such Bank is not otherwise disadvantageous to such Bank.
Section 3.2. Illegality.
(a) If any Bank determines that the introduction of any Requirement of
Law, or any change in any Requirement of Law, or in the interpretation or
administration of any Requirement of Law, has made it unlawful, or that any
central bank or other Governmental Authority has asserted that it is unlawful,
for any Bank or its applicable Lending Office to make Offshore Rate Loans
(including Offshore Rate Loans in any Applicable Currency), then, on notice
thereof by the Bank to the Companies through the Agent, any obligation of that
Bank to make Offshore Rate Loans shall be suspended until the Bank notifies the
Agent and the Companies that the circumstances giving rise to such determination
no longer exist.
(b) If a Bank determines that it is unlawful to maintain any Offshore
Rate Loan, the Companies shall each, upon their receipt of notice of such fact
and demand from such
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Bank (with a copy to the Agent), repay in full such Offshore Rate Loans of that
Bank then outstanding, together with interest accrued thereon and amounts
required under Section 3.4, either on the last day of the Interest Period
thereof, if the Bank may lawfully continue to maintain such Offshore Rate Loans
to such day, or immediately, if the Bank may not lawfully continue to maintain
such Offshore Rate Loan. If the Companies are required to so repay any Offshore
Rate Loan, then concurrently with such repayment, the Companies shall borrow
from the affected Bank, in the amount of such repayment, a Base Rate Loan.
Section 3.3. Increased Costs and Reduction of Return.
(a) If any Bank determines that, due to either (i) the introduction of
or any change (other than any change by way of imposition of or increase in
reserve requirements included in the calculation of the Offshore Rate) in or in
the interpretation of any law or regulation or (ii) the compliance by that Bank
with any guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law), there shall be any increase
in the cost to such Bank of agreeing to make or making, funding or maintaining
any Offshore Rate Loans then the Companies shall be jointly and severally liable
for, and shall from time to time, upon demand (with a copy of such demand to be
sent to the Agent), pay to the Agent for the account of such Bank, additional
amounts as are sufficient to compensate such Bank for such increased costs.
(b) If any Bank shall have determined that (i) the introduction of any
Capital Adequacy Regulation, (ii) any change in any Capital Adequacy Regulation,
(iii) any change in the interpretation or administration of any Capital Adequacy
Regulation by any central bank or other Governmental Authority charged with the
interpretation or administration thereof, or (iv) compliance by the Bank (or its
Lending Office) or any corporation controlling the Bank with any Capital
Adequacy Regulation, affects or would affect the amount of capital required or
expected to be maintained by the Bank or any corporation controlling the Bank
and (taking into consideration such Bank's or such corporation's policies with
respect to capital adequacy and such Bank's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitments, loans, credits or obligations under this Agreement, then, upon
demand of such Bank to the Companies through the Agent, the Companies shall
jointly and severally be obligated to promptly pay to the Bank, from time to
time as specified by the Bank, additional amounts sufficient to compensate the
Bank for such increase.
Section 3.4. Funding Losses.
The Companies shall jointly and severally reimburse each Bank and hold
each Bank harmless from any loss or expense which the Bank may sustain or incur
as a consequence of:
(a) the failure of a Company to make on a timely basis any payment of
principal of any Offshore Rate Loan;
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(b) the failure of a Company to borrow, continue or convert a Loan
after such Company has given (or is deemed to have given) a Notice of Borrowing
or a Notice of Conversion/ Continuation;
(c) the failure of a Company to make any repayment in accordance with
any notice delivered under Section 2.7;
(d) the repayment (including pursuant to Sections 2.7 or 2.8),
prepayment (including pursuant to Section 2.6) or other payment (including after
acceleration thereof) of an Offshore Rate Loan on a day that is not the last day
of the relevant Interest Period; or
(e) the automatic conversion under Section 2.4 of any Offshore Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained or from charges
relating to any Offshore Currency Loans. For purposes of calculating amounts
payable by the Company to the Banks under this Section and under subsection
3.3(a), each Offshore Rate Loan made by a Bank (and each related reserve,
special deposit or similar requirement) shall be conclusively deemed to have
been funded at the LIBOR used in determining the Offshore Rate for such Offshore
Rate Loan by a matching deposit or other borrowing in the interbank eurodollar
market for a comparable amount and for a comparable period, whether or not such
Offshore Rate Loan is in fact so funded.
Section 3.5. Inability to Determine Rates.
If the Agent or the Required Banks determine that for any reason
adequate and reasonable means do not exist for determining the Offshore Rate for
any requested Interest Period with respect to a proposed Offshore Rate Loan, or
that the Offshore Rate applicable pursuant to subsection 2.10(a) for any
requested Interest Period with respect to a proposed Offshore Rate Loan does not
adequately and fairly reflect the cost to such Banks of funding such Loan, the
Agent will promptly so notify the Company requesting such Loan and each Bank.
Thereafter, the obligation of the Banks to make or maintain Offshore Rate Loans
hereunder shall be suspended until the Agent revokes such notice in writing.
Upon receipt of such notice, a Company may revoke any Notice of Borrowing or
Notice of Conversion/Continuation then submitted by it. If a Company does not
revoke such Notice, the Banks shall make, convert or continue the Loans, as
proposed by such Company, in the amount specified in the applicable notice
submitted by such Company, but such Loans shall be made, converted or continued
as Base Rate Loans instead of Offshore Rate Loans. In the case of any Offshore
Currency Loans, the Borrowing or continuation shall be in an aggregate amount
equal to the Dollar Equivalent amount of the originally requested Borrowing or
continuation in the Offshore Currency, and to that end any outstanding Offshore
Currency Loans which are the subject of any continuation shall be redenominated
and converted into Base Rate Loans in
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Dollars with effect from the last day of the Interest Period with respect to any
such Offshore Currency Loans.
Section 3.6. Reserves on Offshore Rate Loans.
The Companies shall jointly and severally pay to each Bank, as long as
such Bank shall be required under regulations of the FRB to maintain reserves
with respect to liabilities or assets consisting of or including Eurocurrency
funds or deposits (currently known as "Eurocurrency liabilities"), and, in
respect of any Offshore Currency Loans, under any applicable regulations of the
central bank or other relevant Governmental Authority in the country in which
the Offshore Currency of such Offshore Rate Loan circulates, additional costs on
the unpaid principal amount of each Offshore Rate Loan equal to the actual costs
of such reserves allocated to such Loan by the Bank (as determined by the Bank
in good faith, which determination shall be conclusive), payable on each date on
which interest is payable on such Loan, provided the Companies shall have
received at least fifteen (15) days' prior written notice (with a copy to the
Agent) of such additional interest from the Bank. If a Bank fails to give notice
fifteen (15) days prior to the relevant Interest Payment Date, such additional
interest shall be payable fifteen (15) days from receipt of such notice.
Section 3.7. Certificates of Banks.
Any Bank claiming reimbursement or compensation under this Article III
shall deliver to the Companies (with a copy to the Agent) a certificate setting
forth in reasonable detail the amount payable to the Bank hereunder. The
Companies shall have ten (10) days to review such certificate and if no
objections are made in writing by the Companies to the applicable Bank within
such period of time, such certificate shall be conclusive and binding on the
Companies in the absence of manifest error.
Section 3.8. Substitution of Banks for Increased Costs.
Upon the receipt by a Company from an Affected Bank of a claim for
compensation under Section 3.3, such Company may: (i) request the Affected Bank
to use its best efforts to obtain a Replacement Bank; (ii) request one more of
the other Banks to acquire and assume all or part of such Affected Bank's Loans
and Commitment; or (iii) designate a Replacement Bank. Any such designation of a
Replacement Bank under clause (i) or (iii) shall be subject to the prior written
consent of the Agent (which consent shall not be unreasonably withheld);
provided that this Section 3.8 shall not relieve the Company from its obligation
to pay to the Affected Bank amounts due under Section 3.3 and arising prior to
substitution of the Replacement Bank or the acquisition by another Bank of the
Affected Bank's Loans and Commitment. The Affected Bank shall not be required to
make any representation or warranty to the Replacement Bank.
Section 3.9. Survival.
The agreements and obligations of the Companies in this Article III
shall survive the payment of all other Obligations.
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ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1. Conditions of Initial Loans.
The obligation of each Bank to make its initial Loan hereunder is
subject to the condition that the Agent shall have received on or before the
Closing Date all of the following, in form and substance satisfactory to the
Agent and each Bank, and in sufficient copies for each Bank:
(a) Credit Agreement and Notes. This Agreement and the Notes executed
by each party thereto;
(b) Reaffirmation of Guaranties and Negative Pledge Agreements. A duly
executed Reaffirmation of Guaranty and Negative Pledge Agreement from each
Guarantor of all Obligations hereunder.
(c) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors of the
Companies and each Subsidiary authorizing the transactions contemplated
hereby, certified as of the Closing Date by the Secretary or an
Assistant Secretary of such Person; and
(ii) A certificate of the Secretary, Assistant Secretary or
equivalent officer of the Companies and each Subsidiary certifying the
names and true signatures of the officers of such Company or such
Subsidiary authorized to execute, deliver and perform, as applicable,
this Agreement, and all other Loan Documents to be delivered by it
hereunder;
(d) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the
bylaws of the Companies as in effect on the Closing Date, certified by
the Secretary or Assistant Secretary of such Company as of the Closing
Date, or equivalent foreign documentation, as applicable; and
(ii) a good standing certificate for the Companies from the
Secretary of State (or similar applicable Governmental Authority) of
its state of incorporation and each state where such Company is
qualified to do business as a foreign corporation as of a recent date,
or the equivalent foreign documentation, as applicable;
(e) Legal Opinions.
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(i) an opinion of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq., counsel to Clare and
addressed to the Agent and the Banks, substantially in the form of
Exhibit D-1; and
(ii) an opinion of Stibbe, Simont, ▇▇▇▇▇▇▇ and Duhot, counsel
to C.P. Clare N.V. and addressed to the Agent and the Banks,
substantially in the form of Exhibit D-2.
(f) Payment of Fees. Evidence of payment by the Companies of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with Attorney Costs of BofA to the extent invoiced
prior to or on the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute BofA's reasonable estimate of Attorney Costs incurred or to
be incurred by it through the closing proceedings (provided that such estimate
shall not thereafter preclude final settling of accounts between the Companies
and BofA); including any such costs, fees and expenses arising under or
referenced in Sections 2.11 and 10.4;
(g) Certificate. A certificate signed by a Responsible Officer, dated
as of the Closing Date, stating that:
(i) the representations and warranties contained in Article V
are true and correct on and as of such date, as though made on and as
of such date;
(ii) no Default or Event of Default exists; and
(iii) there has not occurred since December 28, 1997, any
event or circumstance that has resulted or could reasonably be expected
to result in a Material Adverse Effect; and
(h) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may reasonably request.
Section 4.2. Conditions to All Borrowings.
The obligation of each Bank to make any Loan to be made by it or to
continue or convert any Loan under Section 2.4 is subject to the satisfaction of
the following conditions precedent on the relevant Borrowing Date or
Conversion/Continuation Date:
(a) Notice of Borrowing or Conversion/Continuation. The Agent shall
have received a Notice of Borrowing or a Notice of Conversion/Continuation, as
applicable;
(b) Continuation of Representations and Warranties. The representations
and warranties in Article V shall be true and correct on and as of such
Borrowing Date or Conversion/Continuation Date with the same effect as if made
on and as of such Borrowing Date or Conversion/Continuation Date (except to the
extent such representations and warranties
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expressly refer to an earlier date, in which case they shall be true and correct
as of such earlier date); and
(c) No Existing Default. No Default or Event of Default shall exist or
shall result from such Borrowing, or continuation or conversion.
Each Notice of Borrowing and Notice of Conversion/Continuation submitted by a
Company hereunder shall constitute a representation and warranty by the
Companies hereunder, as of the date of each such notice and as of each Borrowing
Date or Conversion/Continuation Date, as applicable, that the conditions in
Section 4.2 are satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Each Company represents and warrants to the Agent and each Bank that:
Section 5.1. Corporate Existence and Power. Each Company and each of
its Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;
(c) is duly qualified as a foreign corporation and is licensed and in
good standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
or license, other than jurisdictions in which the failure to qualify, be
licensed or in good standing could reasonably be expected to have a Material
Adverse Effect; and
(d) is in compliance with all Requirements of Law, the noncompliance
with which could reasonably be expected to have Material Adverse Effect.
Section 5.2. Corporate Authorization; No Contravention.
The execution, delivery and performance by each Company and each of
their Subsidiaries of this Agreement and each other Loan Document to which such
Person is party, have been duly authorized by all necessary corporate action,
and do not and will not:
(a) contravene the terms of any of that Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of any
document evidencing any Contractual Obligation to which such Person is a party
in excess of Five Hundred Thousand Dollars ($500,000) in the aggregate;
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(c) conflict with or result in any breach or contravention of any
order, injunction, writ or decree of any Governmental Authority to which such
Person or its property is subject and which could reasonably be expected to have
a Material Adverse Effect;
(d) create any Lien that is not a Permitted Lien; or
(e) violate any Requirement of Law that could reasonably be expected to
have a Material Adverse Effect.
Section 5.3. Governmental Authorization.
No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority is necessary or required
in connection with the execution, delivery or performance by, or enforcement
against, the Companies or any of their Subsidiaries of the Agreement or any
other Loan Document.
Section 5.4. Binding Effect.
This Agreement and each other Loan Document to which the Companies or
any of their Subsidiaries are a party constitute the legal, valid and binding
obligations of such Person, enforceable against such Person in accordance with
their respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability.
Section 5.5. Litigation.
Except as specifically disclosed in Schedule 5.5, there are no actions,
suits, proceedings, claims or disputes pending, or to the best knowledge of the
Companies, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, against a Company, or its Subsidiaries or any
of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) if determined adversely to a Company or its Subsidiaries, could
reasonably be expected to have a Material Adverse Effect.
No injunction, writ, temporary restraining order or any order of any nature has
been issued by any court or other Governmental Authority purporting to enjoin or
restrain the execution, delivery or performance of this Agreement or any other
Loan Document, or directing that the transactions provided for herein or therein
not be consummated as herein or therein provided.
Section 5.6. No Default.
No Default or Event of Default exists or would result from the
incurring of any Obligations by a Company. As of the Closing Date, neither
Company nor a Subsidiary of a
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Company is in default under or with respect to any Contractual Obligation in any
respect which, individually or together with all such defaults, could reasonably
be expected to have a Material Adverse Effect, or that would, if such default
had occurred after the Closing Date, create an Event of Default under subsection
8.1(e).
Section 5.7. ERISA Compliance.
Except as specifically disclosed in Schedule 5.7:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of the
Companies, nothing has occurred which would cause the loss of such
qualification. Each Company and each ERISA Affiliate has made all required
contributions to any Plan subject to Section 412 of the Code, and no application
for a funding waiver or an extension of any amortization period pursuant to
Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of a Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither Company
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA); (iv) neither
Company nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Section 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Company nor
any ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA.
Section 5.8. Use of Proceeds; Margin Regulations.
The proceeds of the Loans are to be used solely for the purposes set
forth in and permitted by Section 6.12 and Section 7.7. Neither Company nor any
Subsidiary is generally engaged in the business of purchasing or selling Margin
Stock or extending credit for the purpose of purchasing or carrying Margin
Stock.
Section 5.9. Title to Properties.
Each Company and each Subsidiary has good record and marketable title
in fee simple to, or valid leasehold interests in, all real property necessary
to or used in the ordinary
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conduct of their respective businesses, except for such defects in title as
could not, individually or in the aggregate, have a Material Adverse Effect. As
of the Closing Date, the property of each Company and its Subsidiaries is
subject to no Liens, other than Permitted Liens.
Section 5.10. Taxes.
Each Company and its Subsidiaries have filed all Federal and other
material tax returns and reports required to be filed, and have paid all Federal
and other taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise due and
payable, except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP. There is no proposed tax assessment against a Company or any
Subsidiary that would, if made, have a Material Adverse Effect.
Section 5.11. Financial Condition.
(a) audited consolidated financial statements of Clare and its
Subsidiaries dated March 31, 1997, and the unaudited consolidated financial
statements of Clare and its Subsidiaries dated December 28, 1997, and the
related consolidated statements of income or operations, shareholders' equity
and cash flows for the fiscal year and quarter, respectively, ended on such
dates:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly
noted therein, and, except as noted therein, consistently with prior
periods, and solely with respect to the unaudited financial statements
dated December 28, 1997, were subject to ordinary, good faith year end
audit adjustments;
(ii) fairly present the financial condition of the Companies and
their Subsidiaries on a consolidated basis as of the date thereof and
results of operations for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 5.11, show all
material indebtedness and other liabilities, direct or contingent, of
the Companies and their consolidated Subsidiaries as of the date
thereof, including liabilities for taxes, material commitments and
Contingent Obligations.
(b) Since December 31, 1997, there has been no Material Adverse
Effect.
Section 5.12. Environmental Matters.
Each Company conducts in the ordinary course of business a review of
the effect of existing Environmental Laws and existing Environmental Claims on
its business, operations and properties, and as a result thereof each Company
has reasonably concluded that, except as specifically disclosed in Schedule
5.12, such Environmental Laws and Environmental Claims
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could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Section 5.13. Regulated Entities.
Neither Company, nor any Person controlling a Company, nor any
Subsidiary, is an "Investment Company" within the meaning of the Investment
Company Act of 1940. Neither Company is subject to regulation under the Public
Utility Holding Company Act of 1935, the Federal Power Act, the Interstate
Commerce Act, any state public utilities code, or any other Federal or state
statute or regulation limiting its ability to incur Indebtedness.
Section 5.14. No Burdensome Restrictions.
Neither Company nor any Subsidiary is a party to or bound by any
Contractual Obligation, or subject to any restriction in any Organization
Document, or any Requirement of Law, which could reasonably be expected to have
a Material Adverse Effect.
Section 5.15. Copyrights, Patents, Trademarks and Licenses, etc.
Each Company or its Subsidiaries owns or is licensed or otherwise has
the right to use all of the patents, trademarks, service marks, trade names,
copyrights, contractual franchises, authorizations and other rights that are
reasonably necessary for the operation of their respective businesses, without
conflict with the rights of any other Person. To the best knowledge of each
Company, no slogan or other advertising device, product, process, method,
substance, part or other material now employed, or now contemplated to be
employed, by each Company or any Subsidiary infringes upon any rights held by
any other Person, which infringement could reasonably be expected to have a
Material Adverse Effect. Except as specifically disclosed in Schedule 5.5, no
claim or litigation regarding any of the foregoing is pending or threatened, and
no patent or any statute, law, rule, regulation, standard or code is pending or,
to the knowledge of each Company, proposed, which, in either case, could
reasonably be expected to have a Material Adverse Effect.
Section 5.16. Subsidiaries.
Neither Company has any Subsidiaries other than those specifically
disclosed in part (a) of Schedule 5.16 and neither Company, nor any of its
Subsidiaries, has equity investments in any other corporation or entity other
than those specifically disclosed in part (b) of Schedule 5.16.
Section 5.17. Insurance.
Except as specifically disclosed in Schedule 5.17, the properties of
each Company and its Subsidiaries are insured with financially sound and
reputable insurance companies not Affiliates of a Company, in such amounts, with
such deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
each Company or Subsidiary operates.
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Section 5.18. Swap Obligations.
Neither Company nor any of its Subsidiaries has incurred any
outstanding obligations under any Swap Contracts, other than Permitted Swap
Obligations. Clare has undertaken its own independent assessment of its
consolidated assets, liabilities and commitments and has considered appropriate
means of mitigating and managing risks associated with such matters and has not
relied on any swap counterparty or any Affiliate of any swap counterparty in
determining whether to enter into any Swap Contract.
Section 5.19. Leases.
Neither Company nor any Subsidiary is a party to any obligations for
the payment of rent or lease payments under any lease or agreement to lease
other than as listed on Schedule 5.19 or as may be permitted pursuant to Section
7.10.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required Banks
waive compliance in writing:
Section 6.1. Financial Statements.
Clare shall deliver to the Agent, in the same form and with the same
detail as included in its financial reports filed with the SEC, with sufficient
copies for each Bank:
(a) as soon as available, but not later than one hundred (100) days
after the end of each fiscal year (commencing with the fiscal year ended March
31, 1998), a copy of the audited consolidated balance sheet of Clare and its
Subsidiaries as at the end of such year and the related consolidated statements
of income or operations, shareholders' equity and cash flows for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, and accompanied by the opinion of a nationally-recognized "Big Six"
independent public accounting firm ("Independent Auditor") which report shall
state that such consolidated financial statements present fairly the financial
position for the periods indicated in conformity with GAAP applied on a basis
consistent with prior years. Such opinion shall not be qualified or limited
because of a restricted or limited examination by the Independent Auditor of any
material portion of the Companies' or any Subsidiary's records;
(b) as soon as available, but not later than fifty (50) days after
the end of each of the first three fiscal quarters of each fiscal year
(commencing with the fiscal quarter ended December 31, 1997), a copy of the
unaudited consolidated balance sheet of Clare and its Subsidiaries as of the end
of such quarter and the related consolidated statements of income, shareholders'
equity and cash flows for the period commencing on the first day and ending on
the last day of such quarter, and certified by a Responsible Officer of Clare as
fairly presenting,
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in accordance with GAAP (subject to ordinary, good faith year-end audit
adjustments), the financial position and the results of operations of Clare and
its Subsidiaries;
Section 6.2. Certificates; Other Information.
Each Company shall furnish to the Agent, with sufficient copies for
each Bank:
(a) concurrently with the delivery of the financial statements
referred to in subsections 6.1(a) and (b), a Compliance Certificate executed by
a Responsible Officer of Clare;
(b) promptly, copies of all financial statements and reports that a
Company or any Subsidiary sends to its shareholders, and copies of all financial
statements and regular, periodical or special reports (including Forms 10K, 10Q
and 8K) that a Company or any Subsidiary may make or be required to make to, or
file with, the SEC; and
(c) promptly, when completed or available by such Company, such
additional information regarding the business, financial or corporate affairs of
Clare or any of its Subsidiaries on a consolidated and segment reporting basis
as the Agent, at the reasonable request of any Bank, may from time to time
request, provided, that (i) delivery of such information will not violate the
applicable federal securities laws and (ii) the information requested is
generated or available in the ordinary course of such Company's business.
Section 6.3. Notices.
Each Company shall promptly notify the Agent and each Bank:
(a) of the occurrence of any Default or Event of Default;
(b) of any matter that has resulted or may result in a Material
Adverse Effect, including (i) breach or non-performance of, or any default
under, a Contractual Obligation of a Company or any Subsidiary; (ii) any
dispute, litigation, investigation, proceeding or suspension between a Company
or any Subsidiary and any Governmental Authority; or (iii) the commencement of,
or any material development in, any litigation or proceeding affecting a Company
or any Subsidiary, including pursuant to any applicable Environmental Laws;
(c) of the occurrence of any of the following events affecting a
Company or any ERISA Affiliate (but in no event more than ten (10) days after
such event), and deliver to the Agent and each Bank a copy of any notice with
respect to such event that is filed with a Governmental Authority and any notice
delivered by a Governmental Authority to such Company or any ERISA Affiliate
with respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any
Pension Plan;
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(iii) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by a Company or any ERISA
Affiliate; or
(iv) the adoption of any amendment to a Plan subject to Section
412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability.
(d) of any material change in accounting policies or financial
reporting practices by a Company or any of its consolidated Subsidiaries, except
for changes disclosed in the financial reports of the Companies filed with the
SEC and changes in GAAP;
(e) after the occurrence of a Default or Event of Default, upon the
request of BofA, the Swap Termination Values, together with a description of the
method by which such values were determined, relating to any then-outstanding
Swap Contracts to which a Company or any of its Subsidiaries is party.
Each notice under this Section shall include details of the occurrence
referred to therein, and if appropriate, a brief statement of what action the
affected Company or Subsidiary proposes to take with respect thereto.
Section 6.4. Preservation of Corporate Existence, Etc.
Each Company shall, and shall cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation;
(b) preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
in the normal conduct of its business except in connection with transactions
permitted by Section 7.3 and sales of assets permitted by Section 7.2;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
Section 6.5. Maintenance of Property.
Each Company shall maintain, and shall cause each Subsidiary to
maintain, and preserve all its property which is used or useful in its business
in good working order and condition, ordinary wear and tear excepted, except as
permitted by Section 7.2. Each Company and each Subsidiary shall use the
standard of care typical in the industry in the operation and maintenance of its
facilities.
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Section 6.6. Insurance.
Each Company shall maintain, and shall cause each Subsidiary to
maintain, with financially sound and reputable independent insurers, insurance
with respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons; provided that the Companies and their
Subsidiaries may self-insure their properties and business on terms and
conditions reasonably satisfactory to Banks.
Section 6.7. Payment of Obligations.
Each Company shall, and shall cause each Subsidiary to, pay and
discharge as the same shall become due and payable, all their respective
obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the affected Company or Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien
upon its property;
(c) all indebtedness (other than trade payables), as and when due and
payable, but subject to any subordination provisions contained in any instrument
or agreement evidencing such Indebtedness; and
(d) all indebtedness comprised of trade payables, payable in the
ordinary course of such Company's or Subsidiary's business.
Section 6.8. Compliance with Laws.
Each Company shall comply, and shall cause each Subsidiary to comply,
in all material respects with all Requirements of Law of any Governmental
Authority having jurisdiction over it or its business (including the Federal
Fair Labor Standards Act), except, to the extent such Requirements of Law may be
contested in good faith or as to which a bona fide dispute may exist provided
that non-compliance during the pending of such contest or dispute will not have
a Material Adverse Effect.
Section 6.9. Compliance with ERISA.
Each Company shall, and shall cause each of its ERISA Affiliates to:
(a) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law; (b)
cause each Plan which is qualified under
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Section 401(a) of the Code to maintain such qualification; and (c) make all
required contributions to any Plan subject to Section 412 of the Code.
Section 6.10. Inspection of Property and Books and Records.
Each Company shall maintain and shall cause each Subsidiary to maintain
proper books of record and account, in which full, true and correct entries in
conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of such Company and
such Subsidiary, except that Clare N.V. and each Subsidiary organized in a
foreign jurisdiction shall not be required to maintain their books of record and
account in conformity with GAAP. Each Company shall permit, and shall cause each
Subsidiary to permit, representatives and independent contractors of the Agent
or any Bank to visit and inspect any of their respective properties, to examine
their respective corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants, all at the expense of such Company and at any time during
normal business hours and without advance notice. Prior to the occurrence of a
Default or an Event of Default (i) each Company shall not be responsible for the
expense of more than one (1) inspection per fiscal year, (ii) the expense of
such inspection payable pursuant to the preceding clause will not exceed Five
Thousand Dollars ($5,000), and (iii) such inspection shall be performed upon
reasonable advance notice to such Company.
Section 6.11. Environmental Laws.
Each Company shall, and shall cause each Subsidiary to, conduct its
operations and keep and maintain its property in material compliance with all
Environmental Laws.
Section 6.12. Use of Proceeds.
Each Company shall use the proceeds of the Loans for working capital
and other general corporate purposes not in contravention of any Requirement of
Law or of any Loan Document.
Section 6.13. Additional Subsidiary Guarantors.
In the event the Required Banks consent to the formation of a
Subsidiary or the Companies form a Foreign Sales Corporation established in
accordance with Section 922 of The Internal Revenue Code of 1986, as amended,
the Companies shall, upon the request of Agent or Required Banks, cause such
Subsidiary to become a party to a guaranty and negative pledge agreement in
substantially the same form as those signed by the Guarantors.
Section 6.14. Continuing Nature of Representations and Warranties.
The representations and warranties made by either Company or any
Subsidiary in the Loan Documents shall be a continuing representation and/or
warranty, and each Company and each Subsidiary shall take (or refrain from
taking) such actions as are necessary
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to take (or refrain from taking) to insure that all such representations and
warranties remain true, accurate and complete at all times during the term of
this Agreement except as otherwise provided in this Agreement or consented to in
writing by the Required Banks.
ARTICLE VII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required Banks
waive compliance in writing:
Section 7.1. Limitation on Liens.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
directly or indirectly, make, create, incur, assume or suffer to exist any Lien
upon or with respect to any part of its property, whether now owned or hereafter
acquired, other than the following ("Permitted Liens"):
(a) any Lien existing on property of such Company or any Subsidiary
on the Closing Date and set forth in Schedule 7.1 securing Indebtedness
outstanding on such date;
(b) any Lien created under any Loan Document in favor of a Bank or
Agent;
(c) Liens for taxes, fees, assessments or other governmental charges
which are not delinquent or remain payable without penalty, or to the extent
that non-payment thereof is permitted by Section 6.7; provided that no notice of
lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other similar Liens arising in the ordinary course of business
which are not delinquent or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings and as to which such
reserves or other appropriate provisions as may be required by GAAP are being
maintained;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other social security
legislation;
(f) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all such
liens in the aggregate at any time outstanding for the Companies and their
Subsidiaries do not exceed Two Million Dollars ($2,000,000);
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject
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thereto or interfere with the ordinary conduct of the businesses of a Company
and its Subsidiaries;
(h) purchase money security interests on any property acquired or
held by a Company or its Subsidiaries in the ordinary course of business,
securing Indebtedness incurred or assumed for the purpose of financing all or
any part of the cost of acquiring such property; provided that (i) any such Lien
attaches to such property concurrently with or within twenty (20) days after the
acquisition thereof, (ii) such Lien attaches solely to the property so acquired
in such transaction, (iii) the principal amount of the debt secured thereby does
not exceed one hundred percent (100%) of the cost of such property, and (iv) the
principal amount of the Indebtedness secured by any and all such purchase money
security interests shall not at any time exceed One Million Dollars
($1,000,000);
(i) Liens securing obligations in respect of capital leases on assets
subject to such leases, provided that such capital leases are otherwise
permitted hereunder;
(j) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) no more than an aggregate of One
Million Dollars ($1,000,000) of such deposit accounts are solely dedicated cash
collateral accounts established in the ordinary course of the Companies'
business, (ii) other than as set forth in clause (i), such deposit account is
not a dedicated cash collateral account and is not subject to restrictions
against access by a Company in excess of those set forth by regulations
promulgated by the FRB, and (ii) such deposit account is not intended by a
Company or any Subsidiary to provide collateral to the depository institution;
and
(k) Liens consisting of pledges of cash collateral or government
securities to secure on a ▇▇▇▇-to-market basis Permitted Swap Obligations only,
provided that (i) the counterparty to any Swap Contract relating to such
Permitted Swap Obligations is under a similar requirement to deliver similar
collateral from time to time to the Company or the Subsidiary party thereto on a
▇▇▇▇-to-market basis; and (ii) the aggregate value of such collateral so pledged
by Company and the Subsidiaries together in favor of all counterparties does not
at any time exceed Two Million Dollars ($2,000,000) in the aggregate.
Section 7.2. Disposition of Assets.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
directly or indirectly, sell, assign, lease, convey, transfer or otherwise
dispose of (whether in one or a series of transactions) any property (including
accounts and notes receivable, with or without recourse) to any other Person
(including without limitation any Company or any Subsidiary) or enter into any
agreement to do any of the foregoing, except:
(a) dispositions of inventory, or used, worn-out or surplus equipment,
all in the ordinary course of business;
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(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to the
purchase price of such replacement equipment;
(c) dispositions of Foreign Permitted Receivables pursuant to
Permitted Foreign Receivables Purchase Facilities;
(d) the contribution of property to a Joint Venture as part of the
purchase thereof to the extent permitted under Section 7.4(e); and
(e) divestiture of a business unit by a Company (a "Divestiture") so
long as (i) no Event of Default is in existence at the time of the Divestiture
or would be caused thereby; provided that for purposes of determining compliance
with the financial covenants contained in Section 7 of this Agreement, the
calculation of EBITDA shall exclude the EBIT of the business unit being divested
and (ii) Clare has provided to Agent consolidated pro forma financial
statements, in form and substance satisfactory to Required Banks in their sole
discretion, for the twelve (12) month period commencing with the date of the
Divestiture, which demonstrate in the opinion of Required Banks in their sole
discretion that after giving effect to such Divestiture, the Companies will
continue to be in compliance with the covenants set forth in the Loan Documents.
Section 7.3. Consolidations and Mergers.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
merge, consolidate with or into, or convey, transfer, lease or otherwise dispose
of (whether in one transaction or in a series of transactions all or
substantially all of its assets (whether now owned or hereafter acquired) to or
in favor of any Person, except:
(a) any Subsidiary may merge with a Company, provided that such
Company shall be the continuing or surviving corporation, or may merge with any
one or more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation; and
(b) any Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise), to a Company or another Wholly-Owned
Subsidiary.
Section 7.4. Loans and Investments.
Neither Company shall purchase or acquire, nor shall it suffer or
permit any Subsidiary to purchase or acquire, or make any commitment therefor,
any capital stock, equity interest, or any obligations or other securities of,
or any interest in, any Person, or make or commit to make any Acquisitions, or
make or commit to make any advance, loan, extension of credit or capital
contribution to or any other investment in, any Person including any Affiliate
of a Company (together, "Investments"), except for:
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(a) Investments held by a Company or Subsidiary in the form of Cash
Equivalents;
(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) extensions of credit by a Company to any of its Wholly-Owned
Subsidiaries or by any of its Wholly-Owned Subsidiaries to another of its
Wholly-Owned Subsidiaries;
(d) extensions of credit by any Subsidiary to either Company;
(e) Investments incurred in order to consummate Acquisitions or Joint
Ventures otherwise permitted herein, provided that (i) in the case of
Acquisitions or Joint Ventures with a purchase price of less than Twenty-Five
Million Dollars ($25,000,000) individually and less than Twenty-Five Million
Dollars ($25,000,000) in the aggregate in any fiscal year where the Person to be
acquired is engaged in the same general line of business as that of the
Companies, (A) Clare has provided to Agent consolidated pro forma financial
statements, in form and substance satisfactory to Required Banks in their sole
discretion, for the year commencing with the date of the Acquisition or Joint
Venture, as the case may be, and continuing through the year of the Termination
Date, which demonstrate in the opinion of Required Banks in their sole
discretion that after giving effect to such Acquisition or Joint Venture, as the
case may be, the Companies have been, are, and will continue to be in compliance
with the covenants set forth in the Loan Documents and no Default or Event of
Default will exist, except that if the Acquisition is consummated without Loan
proceeds, the Companies shall not be required to demonstrate compliance with the
covenants set forth in the Loan Documents on a historical basis, (B) after
giving effect to such Acquisition or Joint Venture, the aggregate Commitments of
the Banks exceed the aggregate amount of Loans (with the amount of all Loans
denominated in Offshore Currency converted to the Dollar Equivalent amount) by
at least fifteen percent (15%) of the aggregate Commitments of the Banks, (C)
the Companies may not use, individually or jointly, more than Thirty-Four
Million U.S. Dollars (U.S. $34,000,000) of Loans in connection with such
Acquisition or Joint Venture, (D) such Acquisition or Joint Venture is
undertaken in compliance with all applicable Requirements of Law, and (E) the
prior, effective written consent or approval to such Acquisition or Joint
Venture by the board of directors or equivalent governing body of the acquiree
is obtained or a consent of the acquiree is obtained that is satisfactory to
Agent in its reasonable discretion and, (ii) in the case of Acquisitions or
Joint Ventures with a purchase price of more than Twenty-Five Million Dollars
($25,000,000) individually, more than Twenty-Five Million Dollars ($25,000,000)
in the aggregate in any fiscal year and where the Person to be acquired is
engaged in the same general line of business as the Companies, (1) Clare has
satisfied all of the above conditions in clauses (A) through (E) above, and (2)
Clare has provided to Agent consolidated pro forma financial statements, in form
and substance satisfactory to Required Banks in their sole discretion, for the
year commencing one year prior to such Acquisition or Joint Venture and
continuing through the year of the Termination Date, which demonstrate in the
opinion of Required Banks in their sole discretion that assuming such
Acquisition or Joint
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Venture had occurred one year earlier and after giving effect to such
Acquisition or Joint Venture, the Companies have been, are, and will continue to
be in compliance with the covenants set forth in the Loan Documents and no
Default or Event of Default will exist, except that if the Acquisition is
consummated without Loan proceeds, the Companies shall not be required to
demonstrate compliance with the covenants set forth in the Loan Documents on a
historical basis; and
(f) Investments constituting Permitted Swap Obligations or payments
or advances under Swap Contracts relating to Permitted Swap Obligations.
Section 7.5. Limitation on Indebtedness.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
create, incur, assume, suffer to exist, or otherwise become or remain directly
or indirectly liable with respect to, any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 7.8;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 7.5;
(d) Indebtedness secured by Liens permitted by subsection 7.1(h) and
(k) in an aggregate amount outstanding not to exceed Three Million Dollars
($3,000,000);
(e) Indebtedness incurred in connection with leases permitted
pursuant to Section 7.10;
(f) Foreign exchange forward contracts entered into in the ordinary
course of business, provided that (i) the aggregate exposure to the Companies
and the Subsidiaries under such foreign exchange forward contracts does not
exceed Six Million Dollars ($6,000,000) in any calendar month or Forty Million
Dollars ($40,000,000) at any one time and (ii) no foreign exchange forward
contract exceeds twelve (12) months in length;
(g) Insurance premium financing for Casualty, Property and D&O
Insurance premiums up to a maximum amount of Two Million Dollars ($2,000,000);
and
(h) Unsecured indebtedness entered into in the ordinary course of
business, provided, that (i) the aggregate principal amount of such unsecured
indebtedness incurred by the Companies and the Subsidiaries does not exceed Two
Million Five Hundred Thousand Dollars ($2,500,000) and (ii) such unsecured
indebtedness is repaid within one hundred and eighty (180) days of the date
incurred.
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Section 7.6. Transactions with Affiliates.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
enter into any transaction with any Affiliate of a Company or a Subsidiary,
except upon fair and reasonable terms no less favorable to such Company or such
Subsidiary than would obtain in a comparable arm's-length transaction with a
Person not an Affiliate of such Company or such Subsidiary.
Section 7.7. Use of Proceeds.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
use any portion of the Loan proceeds, directly or indirectly, (i) to purchase or
carry Margin Stock, (ii) to repay or otherwise refinance indebtedness of a
Company or others incurred to purchase or carry Margin Stock, (iii) to extend
credit for the purpose of purchasing or carrying any Margin Stock, or (iv) to
acquire any security in any transaction that is subject to Section 13 or 14 of
the Exchange Act.
Section 7.8. Contingent Obligations.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
create, incur, assume or suffer to exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of a Company and its Subsidiaries existing
as of the Closing Date and listed in Schedule 7.8;
(d) Contingent Obligations with respect to Surety Instruments issued
by a Bank or other Surety Instruments incurred in the ordinary course of
business and not exceeding Two Million Five Hundred Thousand Dollars
($2,500,000) in the aggregate at any time in respect of the Companies and their
Subsidiaries; and
(e) Contingent Obligation incurred by the Guarantors pursuant to
their guaranty of the Obligations.
Section 7.9. Joint Ventures.
Neither Company shall, nor shall it suffer or permit any Subsidiary to
enter into any Joint Venture, except as permitted in subsection 7.4(e) and so
long as each of the following conditions are satisfied for each permitted Joint
Venture (i) the applicable Company's liability with respect to each Joint
Venture is limited to the percentage of ownership of such Company in the Joint
Venture, to the extent such limitation is permitted by applicable law, (ii) the
Companies' liabilities with respect to Joint Ventures in the aggregate does not
exceed Ten Million Dollars ($10,000,000) and (iii) the applicable Company shall
have the Joint Venture
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execute a Negative Pledge Agreement with respect to its assets then owned and
thereafter acquired to the extent of such Company's percentage ownership of the
Joint Venture.
Section 7.10. Lease Obligations.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
create or suffer to exist any obligations for the payment of rent for any
property under lease or agreement to lease or industrial revenue bond financing,
except for operating leases entered into by a Company or any Subsidiary in the
ordinary course of business and capital leases entered into by a Company or any
Subsidiary after the Closing Date to finance the acquisition of equipment;
provided that the aggregate annual, rental and lease payments, as applicable,
for the Companies and their Subsidiaries for all such operating and capital
leases shall not exceed the lesser of (i) Nine Million Dollars ($9,000,000) in
fiscal year 1998 and Ten Million Dollars ($10,000,000) in each fiscal year
thereafter and (ii) the amount which allows the Companies to be in compliance
with the covenants set forth in this Article VII.
Section 7.11. Restricted Payments.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
declare or make any dividend payment or other distribution of assets,
properties, cash, rights, obligations or securities on account of any shares of
any class of its capital stock, or purchase, redeem or otherwise acquire for
value any shares of its capital stock or any warrants, rights or options to
acquire such shares, now or hereafter outstanding; except that;
(a) a Company may declare and make dividend payments or other
distributions payable solely in its common stock;
(b) a Company may purchase, redeem or otherwise acquire shares of its
common stock or warrants or options to acquire any such shares with the proceeds
received from the substantially concurrent issue of new shares of its common
stock;
(c) a Subsidiary may declare and make dividend payments or other
distributions payable solely to the Companies; and
(d) after June 30, 1996, a Company may declare and make cash dividend
payments; provided, that (i) such payment has been approved and authorized by
such Company's Board of Directors, (ii) such payment is made solely out of ten
percent (10%) of such Company's consolidated net income for such fiscal year and
(iii) no Event of Default is in existence at the time of such declaration and
payment or would be caused thereby.
(e) a Company may make any payment of any part or all of any
Subordinated Debt or take or omit to take any other action with respect of any
Subordinated Debt, in accordance with the terms of the subordination agreement
relative thereto and approved by the Required Banks in their sole discretion.
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Section 7.12. ERISA.
Neither Company shall, nor shall it suffer or permit any of its ERISA
Affiliates to, engage in a prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or could
reasonably be expected to result in liability of the Companies and their
Subsidiaries in an aggregate amount in excess of One Million Dollars
($1,000,000).
Section 7.13 Change in Business.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
engage in any material line of business substantially different from those lines
of business carried on by such Company and its Subsidiaries on the date hereof.
Section 7.14. Accounting Changes.
Neither Company shall, nor shall it suffer or permit any Subsidiary to,
make any significant change in accounting treatment or reporting practices,
except as required by GAAP, or change the fiscal year of such Company or of any
Subsidiary.
Section 7.15. Consolidated Tangible Net Worth.
Consolidated Tangible Net Worth for the quarter ending December 31,
1997 will be no less than Seventy-Five Million Dollars ($75,000,000) and
Consolidated Tangible Net Worth for each fiscal quarter thereafter will be no
less than the minimum Consolidated Tangible Net Worth required for the
immediately preceding fiscal quarter plus fifty percent (50%) of the positive
net income of Clare and its Subsidiaries.
Section 7.16. Total Funded Debt to EBITDA.
The ratio of Total Funded Debt to EBITDA shall not exceed 2.0:1.0 at
the end of any fiscal quarter.
Section 7.17. Interest Coverage Ratio.
The Interest Coverage Ratio for the twelve-month period ending on
December 31, 1997 and any twelve-month period ending on the last day of each
fiscal quarter of Clare thereafter shall be at least 2.50:1.00.
Section 7.18. Obligations under Financial Services Agreements.
The Companies obligations (including Contingent Obligations) owed to a
Bank under the Financial Services Agreements shall not at any time exceed the
amount set forth opposite such Bank's name in Schedule 2.1 under the heading
"Financial Services (Excluding Loans)".
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Section 7.19. Subsidiaries.
Neither Company shall, nor shall it permit any Subsidiary to create,
establish or acquire any Subsidiaries other than those existing on the date of
this Agreement; except for a Foreign Sales Corporation established in accordance
with Section 922 of The Internal Revenue Code of 1986, as amended or a newly
formed Subsidiary, so long as in each case the Companies shall cause such
Subsidiary to become a party to a guaranty and negative pledge agreement in
substantially the same form as those signed by Guarantors.
ARTICLE VIII
EVENTS OF DEFAULT
Section 8.1. Event of Default.
Any of the following shall constitute an "Event of Default":
(a) Non-Payment. A Company fails to pay, (i) when and as required to
be paid herein, any amount of principal or interest of any Loan, or (ii) within
five (5) days after the same becomes due, any fee or any other amount payable
hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by a
Company or any Subsidiary made herein or in any other Loan Document is at any
time on or after the date made incorrect in any material respect, or any
representation or warranty which is contained in any certificate, document or
financial or other statement by a Company, any Subsidiary, or any Responsible
Officer, furnished at any time under this Agreement, or in or under any other
Loan Document, is incorrect in any material respect on or as of the date made or
remade; or
(c) Specific Defaults. A Company fails to perform or observe any
term, covenant or agreement contained in any of Section 6.1, 6.2, 6.3 or 6.10 or
in Article VII; or
(d) Other Defaults. A Company or any Subsidiary party thereto fails
to perform or observe (i) any term or covenant contained in either Section 6.4
or 6.9 and such default shall continue unremedied for a period of five (5) days
after the earlier of (A) the date upon which a Responsible Officer knew or
reasonably should have known of such failure or (B) the date upon which written
notice thereof is given to a Company by the Agent or any Bank and (ii) any other
term or covenant contained in this Agreement or any other Loan Document, and
such default shall continue unremedied for a period of twenty (20) days after
the earlier of (A) the date upon which a Responsible Officer knew or reasonably
should have known of such failure or (B) the date upon which written notice
thereof is given to a Company by the Agent or any Bank; or
(e) Cross-Default. (i) A Company or any Subsidiary (A) fails to make
any payment in respect of any Indebtedness or Contingent Obligation (other than
in respect of Swap Contracts), having an aggregate principal amount (including
undrawn committed or available
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amounts and including amounts owing to all creditors under any combined or
syndicated credit arrangement) of more than Two Million Five Hundred Thousand
Dollars ($2,500,000) when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) and such failure continues after
the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure; or (B) fails to perform or observe any
other condition or covenant, or any other event shall occur or condition exist,
under any agreement or instrument relating to any Indebtedness or Contingent
Obligation (other than in respect of Swap Contracts), having an aggregate
principal amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
agreement) of more than $2,500,000 when due (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure
continues after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure if the effect of such failure,
event or condition is to cause, or to permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a trustee
or agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause such Indebtedness to be declared to be due and payable prior to its stated
maturity, or such Contingent Obligation to become payable or cash collateral in
respect thereof to be demanded; (ii) there occurs under any Swap Contract an
Early Termination Date (as defined in such Swap Contract) resulting from (1) any
event of default under such Swap Contract as to which a Company or any
Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (2) any
Termination Event (as defined in such Swap contract) as to which a Company or
any Subsidiary is an Affected Party (as defined in such Swap Contract), and, in
either event, the Swap Termination Value owed by a Company or such Subsidiary as
a result thereof is greater than Two Million Five Hundred Thousand Dollars
($2,500,000); or
(f) Insolvency; Voluntary Proceedings. A Company or any Subsidiary
(i) ceases or fails to be solvent, or generally fails to pay, or admits in
writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against a Company or any Subsidiary, or any
writ, judgment, warrant of attachment, execution or similar process, is issued
or levied against a substantial part of a Company's or any Subsidiary's
properties, and any such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process shall not be
released, vacated or fully bonded within sixty (60) days after commencement,
filing or levy; (ii) a Company or any Subsidiary admits the material allegations
of a petition against it in any Insolvency Proceeding, or an order for relief
(or similar order under non-U.S. law) is ordered in any Insolvency Proceeding;
or (iii) a Company or any Subsidiary acquiesces in the appointment of a
receiver, trustee, custodian, conservator, liquidator, mortgagee in possession
(or agent therefor), or other similar Person for itself or a substantial portion
of its property or business; or
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(h) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against a
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of One Million Dollars ($1,000,000) or more, and the
same shall remain unsatisfied, unvacated and unstayed pending appeal for a
period of ten (10) days after the entry thereof; or
(i) Non-Monetary Judgments. Any non-monetary judgment, order or decree
is entered against a Company or any Subsidiary which does or would reasonably be
expected to have a Material Adverse Effect, and there shall be any period of ten
(10) consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(j) Change of Control. There occurs any Change of Control; or
(k) Unenforceability. Any part of this Agreement or any Loan Document
(other than the Guaranties executed by each Guarantor) is declared unenforceable
or a Company, any Subsidiary or any Guarantor challenges or contests in any
action, suit or proceeding the validity or enforceability of all or any part of
this Agreement or any of the Loan Documents.
(l) Adverse Change. An event occurs which could reasonably be expected
to have a Material Adverse Effect; or
(m) Guarantor Defaults. A Guarantor fails in any material respect to
perform or observe any term, covenant or agreement in its Guaranty; or a
Guaranty is for any reason partially (including with respect to future advances)
or wholly revoked or invalidated, or otherwise ceases to be in full force and
effect, or a Guarantor contests in any manner the validity or enforceability
thereof or denies that it has any further liability or obligation thereunder, or
any event described at subsections (f) or (g) of this Section occurs with
respect to a Guarantor; or
(n) Invalidity of Subordination Provisions. Any agreement or instrument
governing any Subordinated Debt is for any reason revoked or invalidated, or
otherwise cease to be in full force and effect, any Person contests in any
manner the validity or enforceability thereof or denies that it has any further
liability or obligation thereunder, or the Indebtedness hereunder is for any
reason subordinated or does not have the priority contemplated by this
Agreement.
Section 8.2. Remedies.
If any Event of Default occurs, the Agent shall, at the request of, or
may, with the consent of, the Required Banks:
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(a) declare the commitment of each Bank to make Loans to be terminated,
whereupon such commitments shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by each Company; and
(c) exercise on behalf of itself and the Banks all rights and remedies
available to it and the Banks under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 8.1 (in the case of clause (i) of subsection (g) upon the
expiration of the sixty (60) day period mentioned therein), the obligation of
each Bank to make Loans shall automatically terminate and the unpaid principal
amount of all outstanding Loans and all interest and other amounts as aforesaid
shall automatically become due and payable without further act of the Agent or
any Bank.
Section 8.3. Rights Not Exclusive.
The rights provided for in this Agreement and the other Loan Documents
are cumulative and are not exclusive of any other rights, powers, privileges or
remedies provided by law or in equity, or under any other instrument, document
or agreement now existing or hereafter arising.
ARTICLE IX
THE AGENT
Section 9.1. Appointment and Authorization; "Agent".
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 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 Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement 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, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this 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" in this Agreement 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.
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Section 9.2. Delegation of Duties.
The Agent may execute any of its duties under this Agreement or any
other Loan Document by or through agents, employees or attorneys-in-fact and
shall be entitled to advice of counsel 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 with reasonable care.
Section 9.3. Liability of Agent.
None of the Agent-Related Persons shall (i) be liable for any action
taken or omitted to be taken by any of them under or in connection with this
Agreement or any other Loan Document or the transactions contemplated hereby
(except for its own gross negligence or willful misconduct), or (ii) be
responsible in any manner to any of the Banks for any recital, statement,
representation or warranty made by a Company or any Subsidiary or Affiliate of a
Company, or any officer thereof, contained in this Agreement 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 Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of a Company 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 to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of a Company or any of such Company's Subsidiaries
or Affiliates.
Section 9.4. Reliance by Agent.
(a) The Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, 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 a Company), independent
accountants and other experts selected by the Agent. The Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any
other Loan Document unless it shall first receive such advice or concurrence of
the Required 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 Agreement or any
other Loan Document in accordance with a request or consent of the Required
Banks and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 4.1, each Bank that has executed this 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
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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 the Bank.
Section 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 a Company referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default". The Agent will notify the Banks promptly 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 requested by the Required Banks in accordance with Article
VIII; provided, however, that unless and until the Agent has received any such
request, 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.
Section 9.6. Credit and Legal Decision.
Each Bank acknowledges that none of the Agent-Related Persons has made
any representation or warranty to it, and that no act by the Agent hereinafter
taken, including any review of the affairs of a Company and its Subsidiaries,
shall be deemed to constitute any representation or warranty by any
Agent-Related Person to any Bank. Each Bank represents and warrants that it has
made its own legal review of the Companies and Subsidiaries and of the Loan
Documents, without reliance on any Agent-Related Person (including, without
limitation, counsel to the Agent). 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 a Company and
its Subsidiaries, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Companies 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 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 each Company. Except for notices,
reports and other documents expressly herein required to be furnished to the
Banks by the Agent, 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 a Company which may come into the possession of any of the
Agent-Related Persons.
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Section 9.7. Indemnification of Agent.
Whether or not the transactions contemplated hereby are consummated,
the Banks shall indemnify upon demand the Agent-Related Persons (to the extent
not reimbursed by or on behalf of a Company and without limiting the obligation
of the Companies to do so), pro rata, from and against any and all Indemnified
Liabilities; provided, however, that no Bank shall be liable for the payment to
the Agent-Related Persons of any portion of such Indemnified Liabilities
resulting from such Person's gross negligence or willful misconduct. 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 Attorney
Costs) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Agent is not reimbursed for such expenses by or on behalf of the
Companies. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Agent.
Section 9.8. Agent in Individual Capacity.
BofA 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 any Company and its Subsidiaries and Affiliates as though BofA
were not the Agent hereunder and without notice to or consent of the Banks. The
Banks acknowledge that, pursuant to such activities, BofA or its Affiliates may
receive information regarding a Company or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Company or
such Subsidiary) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, BofA shall have the
same rights and powers under this Agreement as any other Bank and may exercise
the same as though it were not the Agent, and the terms "Bank" and "Banks"
include BofA in its individual capacity.
Section 9.9. Successor Agent.
The Agent may, and at the request of the Required Banks shall, resign
as Agent upon thirty (30) days' notice to the Banks. If the Agent resigns under
this Agreement, the Required Banks shall appoint from among the Banks a
successor agent for the Banks. 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 Companies, 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 Article IX and Sections 10.4 and 10.5 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no
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successor agent has accepted appointment as Agent by the date which is thirty
(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 Required Banks appoint a successor agent as provided for above.
Section 9.10. Withholding Tax.
(a) If any Bank is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Bank claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such
Bank agrees with and in favor of the Agent, to deliver to the Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form 1001 before the payment of
any interest in the first calendar year and before the payment of any
interest in each third succeeding calendar year during which interest
may be paid under this Agreement;
(ii) if such Bank claims that interest paid under this Agreement
is exempt from United States withholding tax because it is effectively
connected with a United States trade or business of such Bank, two
properly completed and executed copies of IRS Form 4224 before the
payment of any interest is due in the first taxable year of such Bank
and in each succeeding taxable year of such Bank during which interest
may be paid under this Agreement; and
(iii) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from, or
reduction of, United States withholding tax.
Each such Bank agrees to promptly notify the Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form 1001 and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of a Company to such Bank, such Bank agrees to notify the Agent
of the percentage amount in which it is no longer the beneficial owner of
Obligations of such Company to such Bank. To the extent of such percentage
amount, the Agent will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding tax
by filing IRS Form 4224 with the Agent sells, assigns, grants a participation
in, or otherwise transfers all or part of the Obligations of a Company to such
Bank, such Bank agrees to
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undertake sole responsibility for complying with the withholding tax
requirements imposed by Sections 1441 and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Bank
an amount equivalent to the applicable withholding tax after taking into account
such reduction. However, if the forms or other documentation required by
subsection (a) of this Section are not delivered to the Agent, then the Agent
may withhold from any interest payment to such Bank not providing such forms or
other documentation an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United States
or other jurisdiction asserts a claim that the Agent did not properly withhold
tax from amounts paid to or for the account of any Bank (because the exemption
claimed was not available to such Bank, because the appropriate form was not
delivered or was not properly executed, or because such Bank failed to notify
the Agent of a change in circumstances which rendered the exemption from, or
reduction of, withholding tax ineffective, or for any other reason) such Bank
shall indemnify the Agent fully for all amounts paid, directly or indirectly, by
the Agent as tax or otherwise, including penalties and interest, and including
any taxes imposed by any jurisdiction on the amounts payable to the Agent under
this Section, together with all costs and expenses (including Attorney Costs).
The obligation of the Banks under this subsection shall survive the payment of
all Obligations and the resignation or replacement of the Agent.
ARTICLE X
MISCELLANEOUS
Section 10.1. Amendments and Waivers.
No amendment or waiver of any provision of this Agreement or any other
Loan Document (excluding the Financial Services Agreements), and no consent with
respect to any departure by a Company therefrom, shall be effective unless the
same shall be in writing and signed by the Required Banks (or by the Agent at
the written request of the Required Banks) and the Companies and acknowledged by
the Agent, and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such waiver, amendment, or consent shall, unless in writing and
signed by all the Banks and the Companies and acknowledged by the Agent, do any
of the following:
(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 8.2);
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document (excluding the Financial Services Agreements) for any payment of
principal, interest, fees or other amounts due to the Banks (or any of them)
hereunder or under any other Loan Document (excluding the Financial Services
Agreements);
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(c) reduce the principal of, or the rate of interest specified herein
on any Loan, or (subject to clause (ii) below) any fees or other amounts payable
hereunder or under any other Loan Document (excluding the Financial Services
Agreements);
(d) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for the Banks or any of them to
take any action hereunder; or
(e) amend this Section, or Section 2.14, or any provision herein
providing for consent or other action by all Banks; and, provided further, that
no amendment, waiver or consent shall, unless in writing and signed by the Agent
in addition to the Required Banks or all the Banks, as the case may be, affect
the rights or duties of the Agent under this Agreement or any other Loan
Document.
Amendments and waivers with respect to the Financial Services
Agreements will be made in accordance with the respective terms thereof. The Fee
Letter may be amended, or rights or privileges thereunder waived, in a writing
executed by the parties thereto.
Section 10.2. Notices.
(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by a Company by facsimile (i) shall be immediately confirmed by a
telephone call to the recipient at the number specified on Schedule 10.2, and
(ii) shall be followed promptly by delivery of a hard copy original thereof) and
mailed, faxed or delivered, to the address or facsimile number specified for
notices on Schedule 10.2; or, as directed to a Company or the Agent, to such
other address as shall be designated by such party in a written notice to the
other parties, and as directed to any other party, at such other address as
shall be designated by such party in a written notice to a Company and the
Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Article II or IX to the Agent shall not be effective until
actually received by the Agent.
(c) Any agreement of the Agent and the Banks herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Companies. The Agent and the Banks shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by a Company to
give such notice and the Agent and the Banks shall not have any liability to a
Company or other Person on account of any action taken or not taken by the Agent
or the Banks in reliance upon such telephonic or facsimile notice. The
obligation of the Companies to repay the Loans shall not be affected in any way
or to any extent by any failure by the Agent and the Banks to receive written
confirmation of any
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telephonic or facsimile notice or the receipt by the Agent and the Banks of a
confirmation which is at variance with the terms understood by the Agent and the
Banks to be contained in the telephonic or facsimile notice.
Section 10.3. No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Agent or any Bank, any right, remedy, power or privilege hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
Section 10.4. Costs and Expenses.
The Companies, jointly and severally, agree that they shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Agent) within
five (5) Business Days after demand (subject to subsection 4.1(g)) for all costs
and expenses incurred by BofA (including in its capacity as Agent) in connection
with the development, preparation, delivery, administration and execution of,
and any amendment, supplement, waiver or modification to (in each case, whether
or not consummated), this Agreement, any Loan Document and any other documents
prepared in connection herewith or therewith, and the consummation of the
transactions contemplated hereby and thereby, including reasonable Attorney
Costs incurred by BofA (including in its capacity as Agent) with respect
thereto; and
(b) pay or reimburse the Agent, and each Bank within five (5) Business
Days after demand (subject to subsection 4.1(g)) for all costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or any other Loan Document during the existence of an Event of Default
or after acceleration of the Loans (including in connection with any "workout"
or restructuring regarding the Loans, and including in any Insolvency Proceeding
or appellate proceeding).
Section 10.5. Company Indemnification.
Whether or not the transactions contemplated hereby are consummated,
the Companies, jointly and severally shall indemnify, defend and hold the
Agent-Related Persons, and each Bank and each of its respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement of the
Agent or replacement of any Bank) be imposed on, incurred by or asserted against
any such Person in any way relating to or arising out of the obligations of the
Companies under this Agreement or any document contemplated by or referred to
herein, or
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the transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with respect
to any investigation, litigation or proceeding (including any Insolvency
Proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or the use of the proceeds thereof, or related to any Offshore
Currency transactions entered into in connection herewith, whether or not any
Indemnified Person is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"); provided, that (a) a Company shall have no
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting solely from the gross negligence or willful misconduct of
such Indemnified Person and (b) the Companies shall have no obligation to pay
any of the Attorney Costs of BankBoston, N.A., formerly known as The First
National Bank of Boston in connection with the original documentation and
negotiation of this Agreement or any Loan Document. The agreements in this
Section shall survive payment of all other Obligations.
Section 10.6. Marshalling; Payments Set Aside.
Neither the Agent nor the Banks shall be under any obligation to
▇▇▇▇▇▇▇▇ any assets in favor of a Company or any other Person or in payment of
any or all of the Obligations. To the extent that a Company makes a payment to
the Agent or the Banks, or the Agent or the Banks exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any Insolvency Proceeding or otherwise, then (a)
to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Bank severally agrees to pay to the Agent upon demand its pro rata share of
any amount so recovered from or repaid by the Agent.
Section 10.7. Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns,
except that neither Company may assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of the Agent
and each Bank.
Section 10.8. Assignments, Participations, etc.
(a) Any Bank may, with the written consent of the Agent, which consent
shall not be unreasonably withheld, and thirty (30) days prior written notice to
the Companies, at any time assign and delegate to one or more Eligible Assignees
(provided that no written consent of the Agent shall be required in connection
with any assignment and delegation by a Bank to an Eligible Assignee that is an
Affiliate of such Bank) (each an "Assignee") all, or any ratable part of all, of
the Loans, the Commitments and the other rights and obligations of such Bank
hereunder, in a minimum amount of Ten Million Dollars ($10,000,000) so long as
the assigning Bank maintains a minimum amount of Ten Million Dollars
($10,000,000) of the
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Loans and Commitments; provided, however, that the Companies and the Agent may
continue to deal solely and directly with such Bank in connection with the
interest so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, shall have been given to the Companies and the Agent by
such Bank and the Assignee; (ii) such Bank and its Assignee shall have delivered
to the Companies and the Agent an Assignment and Acceptance in the form of
Exhibit E ("Assignment and Acceptance") together with any Note or Notes subject
to such assignment and (iii) the assignor Bank or Assignee has paid to the Agent
a processing fee in the amount of Three Thousand Dollars ($3,000).
(b) From and after the date that the Agent notifies the assignor Bank
that it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank under
the Loan Documents, and (ii) the assignor Bank shall, to the extent that rights
and obligations hereunder and under the other Loan Documents have been assigned
by it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.
(c) Within five (5) Business Days after its receipt of notice by the
Agent that it has received an executed Assignment and Acceptance and payment of
the processing fee, the Companies shall execute and deliver to the Agent, new
Notes evidencing such Assignee's assigned Loans and Commitment and, if the
assignor Bank has retained a portion of its Loans and its Commitment,
replacement Notes in the principal amount of the Loans retained by the assignor
Bank (such Notes to be in exchange for, but not in payment of, the Notes held by
such Bank). Immediately upon each Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the addition
of the Assignee and the resulting adjustment of the Commitments arising
therefrom.
(d) Any Bank may at any time sell to one or more commercial banks or
other Persons not Affiliates of a Company (a "Participant") participating
interests in any Loans, the Commitment of that Bank and the other interests of
that Bank (the "originating Bank") hereunder and under the other Loan Documents;
provided, however, that (i) the originating Bank's obligations under this
Agreement shall remain unchanged, (ii) the originating Bank shall remain solely
responsible for the performance of such obligations, (iii) the Companies and the
Agent shall continue to deal solely and directly with the originating Bank in
connection with the originating Bank's rights and obligations under this
Agreement and the other Loan Documents, and (iv) no Bank shall transfer or grant
any participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, except to the extent such amendment, consent or waiver
would require unanimous consent of the Banks as described in the first proviso
to Section 10.1. In the case of any such participation, the Participant shall be
entitled to the benefit of Sections 3.1, 3.3 and 10.5 as though it were also a
Bank hereunder, but shall not have
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any other rights under this Agreement, or any of the other Loan Documents, and
all amounts payable by a Company hereunder shall be determined as if such Bank
had not sold such participation; except that, if amounts outstanding under this
Agreement are due and unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each Participant
shall be deemed to have the right of set-off in respect of its participating
interest in amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as a Bank under
this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Bank may
at any time create a security interest in, or pledge, all or any portion of its
rights under and interest in this Agreement and the Note held by it in favor of
any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR Section 203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
Section 10.9. Substitution of Banks for Bank Acquisition.
No less than ninety (90) days after the occurrence of a Bank
Acquisition, BofA or a Company may, upon thirty (30) days prior notice to the
Affected Bank, designate a Replacement Bank; provided, however, that BofA shall,
for a period of ninety (90) days after such notice, have the option to become
the Replacement Bank. Any such designation of a Replacement Bank by the Company
shall be subject to the prior written consent of the Agent (which consent shall
not be unreasonably withheld) and any exercise by BofA of its option to become
the Replacement Bank or any designation of a Replacement Bank by BofA shall be
subject to the consent of the Companies (which consent shall not be unreasonably
withheld).
Section 10.10. Confidentiality.
Each Bank agrees to take and to cause its Affiliates to take normal and
reasonable precautions and exercise due care to maintain the confidentiality of
all information identified as "confidential" or "secret" by a Company and
provided to it by a Company or any Subsidiary, or by the Agent on a Company's or
such Subsidiary's behalf, under this Agreement or any other Loan Document, and
neither it nor any of its Affiliates shall use any such information other than
in connection with or in enforcement of this Agreement and the other Loan
Documents or in connection with other business now or hereafter existing or
contemplated with a Company or any Subsidiary; except to the extent such
information (i) was or becomes generally available to the public other than as a
result of disclosure by the Bank, or (ii) was or becomes available on a
non-confidential basis from a source other than a Company, provided that such
source is not bound by a confidentiality agreement with a Company known to the
Bank; provided, however, that any Bank may disclose such information (A) at the
request or pursuant to any requirement of any Governmental Authority to which
the Bank is subject or in connection with an examination of such Bank by any
such authority; (B) pursuant to subpoena or other court process; (C) when
required to do so in accordance with the provisions of any applicable
Requirement of Law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which the Agent, any Bank or their respective
Affiliates may be
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party; (E) to the extent reasonably required in connection with the exercise of
any remedy hereunder or under any other Loan Document; (F) to such Bank's
independent auditors and other professional advisors; (G) to any Participant or
Assignee, actual or potential, provided that such Person agrees in writing to
keep such information confidential to the same extent required of the Banks
hereunder; (H) as to any Bank or its Affiliate, as expressly permitted under the
terms of any other document or agreement regarding confidentiality to which a
Company or any Subsidiary is party or is deemed party with such Bank or such
Affiliate; and (I) to its Affiliates.
Section 10.11. Set-off.
In addition to any rights and remedies of the Banks provided by law, if
an Event of Default exists or the Loans have been accelerated, each Bank is
authorized at any time and from time to time, without prior notice to either
Company, any such notice being waived by each Company to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Bank to or for the credit or the account
of either Company against any and all Obligations owing to such Bank, now or
hereafter existing, irrespective of whether or not the Agent or such Bank shall
have made demand under this Agreement or any Loan Document and although such
Obligations may be contingent or unmatured. Each Bank agrees promptly to notify
the affected Company and the Agent after any such set-off and application made
by such Bank; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application.
Section 10.12. Debits of Fees.
With respect to any commitment fee, agency fee, or other fee, or any
other cost or expense (including Attorney Costs) due and payable to the Agent or
BofA under the Loan Documents, each Company shall have the option to authorize
BofA to debit any deposit account of either Company with BofA in an amount such
that the aggregate amount debited from all such deposit accounts does not exceed
such fee or other cost or expense. If there are insufficient funds in such
deposit accounts to cover the amount of the fee or other cost or expense then
due, such debits will be reversed (in whole or in part, in BofA's sole
discretion) and such amount not debited shall be deemed to be unpaid. No such
debit under this Section shall be deemed a set-off.
Section 10.13. Notification of Addresses, Lending Offices, Etc.
Each Bank shall notify the Agent in writing of any changes in the
address to which notices to the Bank should be directed, of addresses of any
Lending Office, of payment instructions in respect of all payments to be made to
it hereunder and of such other administrative information as the Agent shall
reasonably request.
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Section 10.14. Counterparts.
This Agreement may be executed in any number of separate counterparts,
each of which, when so executed, shall be deemed an original, and all of said
counterparts taken together shall be deemed to constitute but one and the same
instrument.
Section 10.15. Severability.
The illegality or unenforceability of any provision of this Agreement
or any instrument or agreement required hereunder shall not in any way affect or
impair the legality or enforceability of the remaining provisions of this
Agreement or any instrument or agreement required hereunder.
Section 10.16. No Third Parties Benefited.
This Agreement is made and entered into for the sole protection and
legal benefit of the Companies, the Banks, the Agent and the Agent-Related
Persons, and their permitted successors and assigns, and no other Person shall
be a direct or indirect legal beneficiary of, or have any direct or indirect
cause of action or claim in connection with, this Agreement or any of the other
Loan Documents; provided, that a Participant may be entitled to the benefits of
this Agreement to the extent set forth in subsection 10.8(d).
Section 10.17. Governing Law and Jurisdiction.
(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE AGENT AND
THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANIES, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANIES, THE AGENT AND THE BANKS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANIES, THE AGENT AND
THE BANKS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
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Section 10.18. Waiver of Jury Trial.
THE COMPANIES, THE BANKS AND THE AGENT EACH WAIVE THEIR RESPECTIVE
RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR
ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANIES, THE BANKS AND THE
AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A
COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER
AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF
THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT
OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
Section 10.19. Judgment.
If, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of exchange used shall be that at which
in accordance with normal banking procedures the Agent or with respect to a
Financial Services Agreement the Bank a party thereto, could purchase the first
currency with such other currency on the Business Day preceding that on which
final judgment is given. The obligation of a Company in respect of any such sum
due from it to the Agent or any Bank hereunder or under the other Loan Documents
shall, notwithstanding any judgment in a currency (the "Judgment Currency")
other than that in which such sum is denominated in accordance with the
applicable provisions of this Agreement or the other Loan Documents (the
"Agreement Currency"), be discharged only to the extent that on the Business Day
following receipt by the Agent or such Bank of any sum adjudged to be so due in
the Judgment Currency, the Agent or such Bank may in accordance with normal
banking procedures purchase the Agreement Currency with the Judgment Currency.
If the amount of the Agreement Currency so purchased is less than the sum
originally due to the Agent or such Bank in the Agreement Currency, each Company
agrees, as a separate obligation and notwithstanding any such judgment, to
indemnify the Agent, Bank or the Person to whom such obligation was owing
against such loss. If the amount of the Agreement currency so purchased is
greater than the sum originally due to the Agent or any Bank in such currency,
the Agent or such Bank agrees to return the amount of any excess to such Company
(or to any other Person who may be entitled thereto under applicable law).
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered in Chicago, Illinois by their proper
and duly authorized officers as of the day and year first above written.
C.P. CLARE CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------
Title: President
--------------------
C.P. CLARE N.V.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------
Title: Director
------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
-------------------------
Title: Assistant Vice President
-------------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Bank
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------
Title: Vice President
------------------
BANKBOSTON, N.A., formerly known as
THE FIRST NATIONAL BANK OF BOSTON,
as a Bank
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------
Title: Vice President
--------------------
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SCHEDULES
Schedule 1.1 Organizational Chart
Schedule 2.1 Commitments and Financial Services (Excluding Loans)
Schedule 5.5 Litigation
Schedule 5.7 ERISA
Schedule 5.10 Leases
Schedule 5.11 Permitted Liabilities
Schedule 5.12 Environmental Matters
Schedule 5.16 Subsidiaries and Minority Interests
Schedule 5.17 Insurance Matters
Schedule 7.1 Permitted Liens
Schedule 7.5 Permitted Indebtedness
Schedule 7.8 Contingent Obligations
Schedule 10.2 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinion of Counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F Form of Promissory Notes
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SCHEDULE 2.1
COMMITMENTS
AND PRO RATA SHARES
Bank Commitment Pro Rata Share
---- ---------- --------------
Bank of America National Trust $20,000,000 50%
and Savings Association
BankBoston, N.A. $20,000,000 50%
TOTAL $40,000,000 100%
FINANCIAL SERVICES (EXCLUDING LOANS)
Bank Aggregate Exposure
---- ------------------
Bank of America National Trust $5,000,000
and Savings Association
BankBoston, N.A. $2,000,000
80
SCHEDULE 10.2
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
AS AGENT
Address for Notices:
--------------------
Bank of America National Trust
and Savings Association
Agency Management Service #33499
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇▇, Assistant Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
RE: C. P. Clare Corporation
Address for Payments:
---------------------
Bank of America National Trust
and Savings Association
San Francisco, California
ABA No.: ▇▇▇-▇▇▇-▇▇▇
Account No.: 12334-14744
Reference: C.P. Clare Corporation
Domestic and Offshore Lending Office:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
81
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS A BANK
Address for Payments and Notices:
---------------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Midwest Commercial Banking II
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
RE: C. P. Clare Corporation
BANKBOSTON, N.A.,
AS A BANK
Address for Payments and Notices:
---------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Mail Stop 74-02-04
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
RE: C. P. Clare Corporation
