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Exhibit 10.24
AMENDMENT TO AND RESTATEMENT OF LOAN AGREEMENT
By and Among
DEL LABORATORIES, INC. ("Borrower")
DEL PHARMACEUTICALS, INC. ("DPI" or a "Guarantor")
PARFUMS SCHIAPARELLI, INC. ("Parfums" or a "Guarantor")
ROYCE & ▇▇▇▇▇, INC. ("Royce" or a "Guarantor")
565 BROAD HOLLOW REALTY CORP. ("565" or a "Guarantor")
and
JPMORGAN CHASE BANK, as Administrative Agent for the Lenders
("Administrative Agent, the "Lead Arranger" and the "Book Runner")
FLEET NATIONAL BANK, as Documentation Agent for the Lenders
("Documentation Agent")
and
JPMORGAN CHASE BANK ("JPMORGAN" or a "Lender")
FLEET NATIONAL BANK ("Fleet" or a "Lender")
CITIBANK, N.A. ("Citibank" or a "Lender")
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms ........................ 6
Section 1.02. Computation of Time Periods .................. 22
Section 1.03. Accounting Terms ............................. 22
ARTICLE II AMOUNT AND TERMS OF THE LOANS
Section 2.01. The Revolving Credit Loans ................... 23
Section 2.02. Revolving Credit Loans; Notice,
Continuation and Conversion .................. 23
Section 2.03. Revolving Credit Notes ....................... 25
Section 2.04. Payment of Interest on the Revolving
Credit Notes ................................. 26
Section 2.05. Applicable Margin ............................ 26
Section 2.06. Use of Proceeds .............................. 28
Section 2.07. Commitment Fee; Other Fees ................... 28
Section 2.08. Reductions of Total Commitment ............... 28
Section 2.09. Prepayment ................................... 28
Section 2.10. Reimbursement by Borrower .................... 29
Section 2.11. Statutory Reserves ........................... 29
Section 2.12. Increased Costs .............................. 30
Section 2.13. Capital Adequacy ............................. 31
Section 2.14. Change in Legality ........................... 32
Section 2.15. Indemnity .................................... 32
Section 2.16. Change in LIBOR; Availability of
Rates ........................................ 33
Section 2.17. Authorization to Debit Borrower's
Account ...................................... 33
Section 2.18. Late Charges; Default Interest ............... 33
Section 2.19. Payments ..................................... 34
Section 2.20. Interest Adjustments ......................... 34
ARTICLE IIA THE LETTERS OF CREDIT
Section 2A.01. Letters of Credit ............................ 35
Section 2A.02. Issuance of Letters of Credit ................ 36
Section 2A.03. Participations of Lenders .................... 36
Section 2A.04. Repayment of Participations .................. 37
Section 2A.05. Role of the Issuing Bank ..................... 38
Section 2A.06. Obligations Absolute ......................... 39
Section 2A.07. Uniform Customs and Practices ................ 40
Section 2A.08. Fees and Commissions ......................... 40
ARTICLE III CONDITIONS OF LENDING
Section 3.01. Conditions Precedent to the Making
of the Initial Revolving Credit Loan and
the Issuance of the Initial Letter of
Credit ....................................... 41
Section 3.02. Conditions Precedent to All Revolving
Credit Loans ................................. 44
Section 3.03. Conditions Precedent to All Letters of
Credit and all B/As .......................... 44
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ARTICLE IV REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties ............... 46
(a) Subsidiaries .................................
(b) Organization; Good Standing .................. 46
(a) Loan Documents; No Consents or
Violations ................................... 46
(b) Authorization ................................ 46
(c) Validity and Enforceability .................. 47
(d) Financial Statements ......................... 47
(e) Litigation ................................... 47
(f) Taxes ........................................ 48
(g) Licenses, etc. ............................... 48
(h) No Adverse Agreements ........................ 48
(i) Margin Stock ................................. 48
(j) Compliance with Laws ......................... 48
(k) ERISA ........................................ 49
(l) Hazardous Materials .......................... 49
(m) Use of Proceeds .............................. 50
(n) Title to Assets; No Liens .................... 50
(o) Casualties, etc. ............................. 50
(p) Solvency ..................................... 50
(q) Financial Advantage .......................... 50
(r) Credit Agreements, etc. ...................... 50
(s) Consolidated Tangible Net Worth .............. 51
ARTICLE V COVENANTS OF THE BORROWER AND THE GUARANTOR
Section 5.01. Affirmative Covenants ........................ 52
(a) Complannce with Laws, Etc. ................... 52
(b) Reporting Requirements ....................... 52
(c) Taxes ........................................ 54
(d) Corporate Existence .......................... 55
(e) Maintenance of Properties and Insurance ...... 55
(f) Books of Record and Account .................. 55
(g) Visitation ................................... 55
(h) Performance and Compliance with Other
Agreements ................................... 56
(i) Pension Funding .............................. 56
(j) Licenses; Trademarks ......................... 56
(k) New Subsidiaries ............................. 57
Section 5.02. Negative Covenants ............................ 57
(a) Liens Etc. ................................... 57
(b) Debt ......................................... 58
(c) Merge ........................................ 59
(d) Sale of Assets, Etc. ......................... 59
(e) Investments, Etc. ............................ 60
(f) Transactions With Affiliates ................. 60
(g) Prepayment of Outstanding Debt ............... 60
(h) Guarantees ................................... 60
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(i) Change of Business ........................... 60
(j) Fiscal Year .................................. 60
(k) Maximim Losses ............................... 60
(l) Accounting Policies .......................... 60
(m) Dividends, Etc. .............................. 60
(n) Change in Control ............................ 61
(o) Hazardous Material ........................... 61
(p) Limitations on Consolidated Foreign
Assets and Revenues .......................... 61
Section 5.03. Financial Requirements ....................... 62
(a) Minimum Consolidated Tangible Net Worth ...... 62
(b) Consolidated Capital Expenditures ............ 62
(c) Consolidated Fixed Charge Ratio .............. 62
(d) Funded Debt to EBITDA Ratio .................. 62
(e) Consolidated Interest Coverage Ratio ......... 62
ARTICLE VI EVENTS OF DEFAULT
Section 6.01. Events of Default ............................ 63
Section 6.02. Remedies on Default .......................... 65
Section 6.03. Remedies Cumulative .......................... 65
ARTICLE VII THE AGENTS; RELATIONS AMONG LENDERS AND BORROWER
Section 7.01. Appointment, Powers and Immunities
of Agents .................................... 67
Section 7.02. Reliance by Administrative Agent ............. 67
Section 7.03. Defaults ..................................... 68
Section 7.04. Rights of Agents as Lenders .................. 68
Section 7.05. Indemnification of Administrative Agent ...... 69
Section 7.06. Documents .................................... 69
Section 7.07. Non-Reliance on Agents and Other Lenders 70
Section 7.08. Failure of Administrative Agent to Act ....... 70
Section 7.09. Resignation of Agents ........................ 70
Section 7.10. Amendments Concerning Agency Function ........ 71
Section 7.11. Liability of Agents .......................... 71
Section 7.12. Transfer of Agency Function .................. 71
Section 7.13. Withholding Taxes ............................ 72
Section 7.14. Several Obligations and Rights of Lenders .... 72
Section 7.15. Pro Rata Treatment of Loans, Etc ............. 72
Section 7.16. Sharing of Payments Among Lenders ............ 72
Section 7.17. Nonreceipt of Funds By Administrative
Agent; Payments to Lenders ................... 73
ARTICLE VIII MISCELLANEOUS
Section 8.01. Amendments, Etc .............................. 75
Section 8.02. Notices, Etc ................................. 75
Section 8.03. No Waiver; Remedies .......................... 75
Section 8.04. Costs and Expenses ........................... 76
Section 8.05. Right of Set-Off ............................. 76
Section 8.06. Binding Effect ............................... 77
Section 8.07. Successors and Assigns ....................... 77
Section 8.08. Further Assurances ........................... 78
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Section 8.09. Section Headings, Severability,
Entire Agreement ............................. 78
Section 8.10. Confidentiality .............................. 79
Section 8.11. Governing Law ................................ 79
Section 8.12. Waiver of Jury Trial ......................... 80
Section 8.13. Execution in Counterparts .................... 80
Schedule 1.01 Commitments of Each Lender ................... 83
Schedule 2.01 Existing Letters of Credit ................... 84
Schedule 4.01(a) Subsidiaries .............................. 85
Schedule 4.01(t) Credit Agreements ......................... 86
Schedule 5.02(a) Liens ..................................... 87
Schedule 5.02(b) Debt ...................................... 88
Schedule 5.02(h) Guaranties ................................ 89
Exhibit A Revolving Credit Note ..................................... 90
Exhibit B Assignment and Assumption Agreement ........................ 93
Exhibit C Release and Termination Agreement .......................... 97
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AMENDMENT TO LOAN AGREEMENT
THIS AMENDMENT TO LOAN AGREEMENT ("Amendment") made this 26th day of
March, 2002 among DEL LABORATORIES, INC., a Delaware corporation, having its
principal place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the
"Borrower"), DEL PHARMACEUTICALS, INC., a Delaware corporation, having its
principal place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("DPI"),
PARFUMS SCHIAPARELLI, INC., a New York corporation, having its principal place
of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Parfums"), ROYCE &
▇▇▇▇▇, INC., a Delaware corporation, having its principal place of business at
▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Royce"), ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇., ▇ ▇▇▇ ▇▇▇▇ corporation, having its principal place of business at ▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("565"), (DPI, Parfums, Royce and 565,
individually a "Guarantor" and collectively, the "Guarantors") and JPMORGAN
CHASE BANK (formerly The Chase Manhattan Bank), as agent for the Lenders (as
defined herein), a New York banking corporation, having an office at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Agent"), JPMORGAN CHASE
BANK, a New York banking corporation, having an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("JPMorgan" or a "Lender") and
CITIBANK, N.A. (successor to European American Bank), a national banking
association, having an office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇ ("Citibank" or a "Lender") hereby agree as follows:
W I T N E S S E T H :
WHEREAS, the Borrower, the Guarantors and Chase had entered into a Loan
Agreement dated as of the 30th day of December, 1998 as amended by certain
amendments thereto dated June 10, 1999 and November 12, 1999 and an amendment
adding Citibank as a Lender and naming JPMorgan as the Agent for the Lenders on
February 25, 2000 (hereinafter the "Agreement"); and
WHEREAS, the Borrower, the Guarantors, the Agent and the Lenders desire
to again amend the Agreement to among other things, (i) provide for JPMorgan to
act as the Administrative Agent, Lead Arranger and Book Runner, (ii) add Fleet
National Bank as the Documentation Agent and a Lender, (iii) increase the
amounts available to be borrowed under the Agreement, (iv) release the
Collateral (as defined in the Agreement) and (v) make such other changes as the
parties may agree.
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Guarantors, the Agent and the Lenders do hereby
agree to amend and restate the Agreement to read in its entirety as follows:
AMENDMENT TO AND RESTATEMENT OF LOAN AGREEMENT
Amended and Restated as of March 26, 2002
DEL LABORATORIES, INC., a Delaware corporation, having its principal
place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Borrower"),
DEL PHARMACEUTICALS, INC., a Delaware corporation, having its principal place of
business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("DPI"), PARFUMS
SCHIAPARELLI, INC., a New York corporation, having its principal place of
business at ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Parfums"), ROYCE & ▇▇▇▇▇,
INC., a Delaware corporation, having its principal place of business at ▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Royce"), ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇ ▇▇▇
▇▇▇▇ corporation, having its principal place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("565"), (DPI, Parfums, Royce and 565, individually a
"Guarantor" and collectively, the "Guarantors") and JPMORGAN CHASE BANK, as
Administrative Agent for the Lenders (as defined herein), a New York banking
corporation, having an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Administrative Agent", the "Lead Arranger" and the "Book
Runner"), FLEET NATIONAL BANK, as Documentation Agent for the Lenders (as
defined herein), a national banking association having an office at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Documentation Agent"), JPMORGAN
CHASE BANK, a New York banking corporation, having an office at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("JPMorgan" or a "Lender")
FLEET NATIONAL BANK, a national banking association having an office at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Fleet" or a "Lender")and CITIBANK,
N.A., a national banking association, having an office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Citibank" or a "Lender") hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ADJUSTED LIBOR RATE" means, with respect to any Eurodollar Loan for
any Interest Period, an interest rate per annum (rounded, if not already a whole
multiple of 1/16th of one percent to the nearest 1/16th of one percent) equal to
the product of (a) the LIBOR Rate and (b) Statutory Reserves.
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"ADMINISTRATIVE AGENT" means JPMorgan Chase Bank, or such other Lender
as may succeed to the position of Administrative Agent, as provided in this
Agreement.
"AFFILIATE" means, as to any Person (i) a Person which directly or
indirectly controls, or is controlled by, or is under common control with, such
Person; (ii) a Person which directly or indirectly beneficially owns or holds
twenty (20%) percent or more of any class of voting stock of, or twenty (20%)
percent or more of the equity interest in, such Person; or (iii) a Person twenty
(20%) percent or more of the voting stock of which, or twenty (20%) percent or
more of the equity interest of which, is directly or indirectly beneficially
owned or held by such Person, provided, however, that with respect to the
Borrower or any Guarantor, no natural Person, and no trust, estate or other
entity which may hold assets of such natural Person for estate planning purposes
or upon such natural Person's death, shall be deemed an Affiliate of the
Borrower or a Guarantor. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise.
"AGENT" means the Administrative Agent or the Documentation Agent, as
the context requires.
"AGGREGATE OUTSTANDINGS" means, at any time the sum of (i) outstanding
Revolving Credit Loans plus (ii) Outstanding L/C Exposure.
"AGREEMENT" means this Loan Agreement, as amended, supplemented or
modified from time to time.
"ALTERNATE BASE RATE" means, for any day, the higher of (a) the Prime
Rate (computed on the basis of the actual number of days elapsed over a year of
360 days) in effect on such day or (b) the Federal Funds Effective Rate in
effect on such day plus one-half of one (1/2%) percent (computed on the basis of
the actual number of days elapsed over a year of 360 days). For purposes of this
Agreement any change in the Alternate Base Rate due to a change in the Prime
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively. If for any reason the Administrative Agent shall have reasonably
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including, without limitation, the inability or failure of the Administrative
Agent to obtain sufficient bids or publications in accordance with the terms
thereof, the Alternate Base Rate shall be determined without regard to clause
(b) of the first sentence of this definition, as appropriate, until the
circumstances giving rise to such inability no longer exist.
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"ALTERNATE BASE RATE LOAN" means a Loan bearing interest at the
Alternate Base Rate in accordance with the provisions of Article II hereof.
"APPLICABLE MARGIN" means the amount of basis points to be added to the
Alternate Base Rate or the Adjusted LIBOR Rate as provided in Section 2.04 of
this Agreement and as determined pursuant to Section 2.05 of this Agreement.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" means the agreement by which a
Lender assigns all or part of its Commitment and its interests in the Loans to
another Lender, as provided in Section 8.07 of this Agreement.
"B/AS" means time drafts drawn by the beneficiary of a Time Letter of
Credit on the Issuing Bank and accepted by the Issuing Bank pursuant to Section
2A hereof for the account of the Borrower in connection with or in conjunction
with Time Letters of Credit having not more than 180 days' to run, which grow
out of transactions involving the importation or the domestic shipment of goods.
All such drafts shall be subject to the provisions of the Federal Reserve Act,
as amended, and the rules and regulations thereunder. In addition, all such
drafts shall be eligible for purchase by, discount with and pledge to, the
Federal Reserve Bank of New York.
"BA RATE" means the rate per annum established by the Issuing Bank from
time to time as its acceptance rate for B/As.
"BOARD OF GOVERNORS" means the Board of Governors of the Federal
Reserve System of the United States of America.
"BUSINESS DAY" means a day of the year on which banks are not required
or authorized to close in New York City, provided that, if the relevant day
relates to a Eurodollar Loan, a Eurodollar Interest Period, or notice with
respect to a Eurodollar Loan, the term "Business Day" shall mean a day on which
dealings in dollar deposits are also carried on in the London interbank market
and banks are open for business in London.
"CAPITAL EXPENDITURES" means as to any Person, the aggregate amount of
any expenditures (including purchase money debt and purchase money liens) by
such Person for assets (including fixed assets acquired under Capital Leases)
which it is contemplated will be used or usable in fiscal years subsequent to
the year of acquisition and that are required to be capitalized in accordance
with GAAP.
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"CAPITAL LEASE" means a lease which has been, or should be, in
accordance with GAAP, capitalized on the books of the lessee.
"CASH FLOW COVERAGE RATIO" means, as to the Borrower and its
Consolidated Subsidiaries, the ratio of (i) Consolidated EBITDA to (ii) the sum
of consolidated gross interest expense PLUS consolidated income taxes paid PLUS
Consolidated Unfunded Capital Expenditures PLUS Permitted Dividends PLUS
Permitted Open Market Stock Repurchases (all measured for the four (4) fiscal
quarters then ended) PLUS the principal amortization on the Senior Notes and
other Consolidated Funded Debt scheduled to be paid during the fiscal year of
the date of determination thereof.
"CLOSING DATE" means the date on which the conditions precedent set
forth in Section 3.01 of this Agreement, are satisfied.
"COMMITMENT" means, with respect to each Lender, the obligation of such
Lender (i) to make Revolving Credit Loans to the Borrower pursuant to the terms
and subject to the conditions of this Agreement and (ii) in the case of the L/C
Issuer, to issue Letters of Credit for the account of the Borrower or DPI or in
the case of the other Lenders, to take risk participations in the Letters of
Credit issued by the Issuing Bank, each pursuant to the terms and subject to the
conditions of this Agreement, in the aggregate Dollar amount and Pro Rata Share
set forth in Schedule 1.01 annexed hereto, as modified by any reductions in the
Total Commitment or by any assignments of all or any part of such Lender's
Commitment.
"CONFIRMATION OF GUARANTY" means the Guarantor Confirmation Agreement
to be executed and delivered by each Guarantor, pursuant to which such Guarantor
confirms and reaffirms its obligations under the Guaranties issued in connection
with the February 2000 Amendment.
"CONSOLIDATED CAPITAL EXPENDITURES" means, as to any Person, the
aggregate amount of the Capital Expenditures by such Person and its Consolidated
Subsidiaries, computed and consolidated in accordance with GAAP.
"CONSOLIDATED EBITDA" means, as to any Person, for any period, the
EBITDA of such Person and its Consolidated Subsidiaries, computed and
consolidated in accordance with GAAP.
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"CONSOLIDATED FIXED CHARGE RATIO" means, as to the Borrower and its
Consolidated Subsidiaries, the ratio of (i) the sum of net income PLUS gross
interest expense PLUS income tax expense for the period measured PLUS
depreciation expense PLUS amortization of intangible assets MINUS Consolidated
Unfunded Capital Expenditures made during such period MINUS Permitted Dividends
paid in cash during such period MINUS Permitted Stock Repurchases made during
such period to (ii) the sum of the current portion of Consolidated Funded Debt,
computed and consolidated in accordance with GAAP (excluding Debt described in
clauses (ii), (v) and (vii) of the definition of "Consolidated Funded Debt")
PLUS gross interest expense for such period. The Consolidated Fixed Charge
Coverage Ratio shall be measured for the four (4) fiscal quarters then ended,
except for the current portion of Consolidated Funded Debt, which shall be
measured for the next succeeding four (4) fiscal quarters.
"CONSOLIDATED FUNDED DEBT" means, as to any Person, at any date, any
Debt of such Person and its Consolidated Subsidiaries which is (i) indebtedness
or liability for borrowed money having an original maturity of one (1) year or
more (including the current portion thereof) or which is extendable at the
option of the obligor to a date more than one year from the date of such
extension, including, in any event, all of the outstanding Revolving Credit
Loans; (ii) indebtedness or liability for borrowed money under lines of credit
extended to such Person or any of its Consolidated Subsidiaries; (iii) the
deferred purchase price of property (excluding trade obligations); (iv)
obligations as a lessee under Capital Leases; (v) obligations to reimburse a
letter of credit issuer for draws under letters of credit; (vi) obligations
under B/As; and (vii) all liabilities under any preferred stock which, at the
option of the holder or upon the occurrence of one or more certain events, is
redeemable by such holder, or which, at the option of such holder is convertible
into Debt.
"CONSOLIDATED INTEREST COVERAGE RATIO" means, as to any Person, for any
period, the ratio of (i) Consolidated EBITDA to (ii) consolidated gross interest
expense. The Consolidated Interest Coverage Ratio shall be measured for the four
(4) fiscal quarters then ended.
"CONSOLIDATED NET INCOME" means, with respect to the Borrower and its
Consolidated Subsidiaries, net income for a fiscal period, computed and
consolidated in accordance with GAAP.
"CONSOLIDATED SUBORDINATED DEBT" means, as to any Person, all of the
Subordinated Debt of such Person and its Consolidated Subsidiaries, computed and
consolidated in accordance with GAAP.
"CONSOLIDATED SUBSIDIARIES" means, as to any Person, those Subsidiaries
of such Person which are consolidated with such Person in the financial
statements delivered pursuant to Section 5.01(b).
"CONSOLIDATED TANGIBLE NET WORTH" means, as to any Person, the excess
of (i) such Person's Consolidated Total Assets, less all intangible assets
properly classified as such in accordance with GAAP, including, but without
limitation, patents, patent rights, trademarks, trade names, franchises,
copyrights, licenses, permits and goodwill over (ii) such Person's Consolidated
Total Liabilities.
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"CONSOLIDATED TOTAL ASSETS" means, as to any Person, at any date, the
aggregate net book value of the assets of such Person and its Consolidated
Subsidiaries at such date, after all appropriate adjustments in accordance with
GAAP (including without limitation, reserves for doubtful receivables,
obsolescence, depreciation and amortization and excluding the amount of any
write-up or revaluation of any asset, other than those permitted under standard
cost accounting procedures), computed and consolidated in accordance with GAAP.
"CONSOLIDATED TOTAL LIABILITIES" means, as to any Person, at any date,
all of the liabilities of such Person and its Consolidated Subsidiaries at such
date, including all items which, in accordance with GAAP would be included on
the liability side of the balance sheet (other than capital stock, treasury
stock, capital surplus and retained earnings) computed and consolidated in
accordance with GAAP.
"CONSOLIDATED UNFUNDED CAPITAL EXPENDITURES" means, as to any Person,
the aggregate amount of the Unfunded Capital Expenditures by such Person and its
Consolidated Subsidiaries, computed and consolidated in accordance with GAAP.
"DEBT" means, as to any Person, all (i) indebtedness or liability of
such Person for borrowed money; (ii) indebtedness of such Person for the
deferred purchase price of property or services (including trade obligations);
(iii) obligations of such Person as a lessee under Capital Leases; (iv) current
liabilities of such Person in respect of unfunded vested benefits under any
Plan; (v) reimbursement obligations of such Person under letters of credit
issued for the account of such Person; (vi) reimbursement obligations of such
Person arising under acceptance facilities; (vii) guaranties, endorsements
(other than for collection or deposit in the ordinary course of business) and
other contingent obligations to purchase, to provide funds for payment, to
supply funds to invest in any other Person, or otherwise to assure a creditor
against loss; (viii) obligations secured by any Lien on property owned by such
Person whether or not the obligations have been assumed; (ix) liabilities of
such Person under any preferred stock or other preferred equity instrument
which, at the option of the holder or upon the occurrence of one or more events,
is redeemable by such holder, or which, at the option of such holder is
convertible into Debt; and (x) all other liabilities recorded as such, or which
should be recorded as such, on such Person's financial statements in accordance
with GAAP.
"DEFAULT" means any of the events specified in Section 6.01 of this
Agreement, whether or not any requirement for notice or lapse of time or any
other condition has been satisfied.
-11-
"DOCUMENTATION AGENT" means Fleet National Bank, or such other Lender
as may succeed to the position of Documentation Agent, as provided in this
Agreement.
"DOLLARS" AND THE SIGN "$" mean lawful money of the United States of
America.
"EBITDA" means, as to any Person, for any period, the sum of (i) net
income PLUS (ii) gross interest expense PLUS (iii) income tax expense PLUS (iv)
depreciation expense PLUS (v) amortization of intangible assets, all measured
and/or calculated for the four (4) fiscal quarters then ended.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, the regulations promulgated thereunder and the
published interpretations thereof as in effect from time to time.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) which together with any other Person would be treated, with such
Person, as a single employer under Section 4001 of ERISA.
"EURODOLLAR LOAN" means a Loan bearing interest at a rate based on the
Adjusted LIBOR Rate in accordance with the provisions of Article II hereof.
"EVENT OF DEFAULT" means any of the events specified in Section 6.01 of
this Agreement, provided that any requirement for notice or lapse of time or any
other condition has been satisfied.
"EXISTING COLLATERAL DOCUMENTS" means, collectively, (i) each security
agreement dated as of February 25, 2000 executed and delivered by the Borrower
and the Guarantors in connection with the February 2000 Amendment, (ii) each
trademark security agreement dated as of February 25, 2000 executed and
delivered by Borrower and the Guarantors in connection with the February 2000
Amendment and (iii) the Intercreditor and Collateral Agency Agreement dated as
of February 25, 2000 among JPMorgan, as collateral agent, the Administrative
Agent, the Lenders and the Senior Note Holders and acknowledged by the Borrower.
"EXISTING LETTERS OF CREDIT" means the letters of credit issued under
the February 2000 Amendment and listed on schedule 2.01 hereto.
"FEBRUARY 2000 AMENDMENT" means the amendment and restatement of the
loan agreement then in effect among certain of the parties hereto, dated as of
February 25, 2000.
-12-
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three (3) federal
funds brokers of recognized standing selected by it.
"FEE LETTER" means the letter dated January 17, 2002 from the
Administrative Agent to the Borrower pursuant to which the Borrower agrees to
pay certain administrative and other fees to the Administrative Agent.
"FOREIGN SUBSIDIARIES" means, with respect to the Borrower, those
Subsidiaries of the Borrower which are incorporated, formed or organized outside
of the United States.
"FUNDED DEBT TO EBITDA RATIO" means, as to the Borrower and its
Consolidated Subsidiaries for any period, the ratio of (i) Consolidated Funded
Debt (as of the last day of such period) to (ii) Consolidated EBITDA for such
period. The Funded Debt to EBITDA Ratio shall be measured for a period covering
the four (4) fiscal quarters then ended.
"GAAP" means Generally Accepted Accounting Principles.
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means those generally
accepted accounting principles and practices which are recognized as such by the
American Institute of Certified Public Accountants acting through the Financial
Accounting Standards Board ("FASB") or through other appropriate boards or
committees thereof and which are consistently applied for all periods so as to
properly reflect the financial condition, operations and cash flows of a Person,
except that any accounting principle or practice required to be changed by the
FASB (or other appropriate board or committee of the FASB) in order to continue
as a generally accepted accounting principle or practice may be so changed. Any
dispute or disagreement between the Borrower and the Administrative Agent
relating to the determination of Generally Accepted Accounting Principles shall,
in the absence of manifest error, be conclusively resolved for all purposes
hereof by the written opinion with respect thereto, delivered to the
Administrative Agent, of the independent accountants selected by the Borrower
and reasonably satisfactory to the Administrative Agent for the purpose of
auditing the periodic financial statements of the Borrower.
-13-
"GUARANTEEING FOREIGN SUBSIDIARIES" means those Foreign Subsidiaries of
the Borrower required to become a Guarantor pursuant to Section 5.01(k) of this
Agreement.
"GUARANTOR" OR GUARANTORS" means those Persons identified as Guarantors
in the preamble to this Agreement, and any other Person required to guarantee
the obligations of the Borrower in accordance with Section 5.01(k) of this
Agreement.
"GUARANTY" OR "GUARANTIES" means the guaranty or guaranties executed
and delivered by one or more Guarantors pursuant to Section 3.01(h) or Section
5.01 (k) of this Agreement.
"HAZARDOUS MATERIALS" means, any flammable explosives, radioactive
materials, hazardous materials, hazardous wastes, hazardous or toxic substances,
or related materials regulated pursuant to the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C.
Sections 9601, et seq.), the Hazardous Materials Transportation Act, as amended
(49 U.S.C. Section 1801 et seq.), the Resource Conservation and Recovery Act, as
amended (42 U.S.C. Sections 6901 et. seq.), and in the regulations adopted and
publications promulgated pursuant thereto, or any other federal, state or local
environmental law, ordinance, rule or regulation related to the pollution or
protection of the environment.
"INTERCOMPANY DEBT" means Debt owing by the Borrower to any Guarantor
or from any Guarantor to the Borrower or from any Guarantor to any other
Guarantor.
"INTEREST DETERMINATION DATE" means the date on which an Alternate Base
Rate Loan is converted to a Eurodollar Loan and, in the case of a Eurodollar
Loan, the last day of the applicable Interest Period.
"INTEREST PAYMENT DATE" means (i) as to each Eurodollar Loan, the last
Business Day of each calendar quarter during the applicable Interest Period and
the last day of each Interest Period and (ii) as to each Alternate Base Rate
Loan, the last Business Day of each calendar quarter.
"INTEREST PERIOD" means the period commencing on the date of any
Eurodollar Loan and ending on the numerically corresponding day in the calendar
month that is one, two, three, six or twelve months thereafter (subject to
availability), as the Borrower may elect (or, if there is no numerically
corresponding day, on the last Business Day of such month); provided, however,
(i) no Interest Period shall end later than the Maturity Date, (ii) if any
Interest Period would end on a day which shall not be a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day,
(iii) interest shall accrue from and including the first day of such Interest
Period to but excluding the date of payment of such interest pursuant to Section
2.04, and (iv) no Interest Period of particular duration may be selected by the
Borrower if the Administrative Agent determines, in its sole discretion, that
Eurodollar Loans with such maturities are not generally available.
-14-
"INVESTMENT" means any stock, evidence of Debt or other security of any
Person, any loan, advance, contribution of capital, extension of credit or
commitment therefor, including without limitation the guaranty of loans made to
others (except for current trade and customer accounts receivable for services
rendered in the ordinary course of business and payable in accordance with
customary trade terms in the ordinary course of business) and any purchase of
(i) any security of another Person or (ii) any business or undertaking of any
Person or any commitment or option to make any such purchase, or any other
investment.
"ISSUING BANK" means JPMorgan, or such other Lender that may succeed
JPMorgan as the issuer of Letters of Credit or B/As pursuant to this Agreement.
"L/C DOCUMENTS" means all documents required to be executed and
delivered by the Borrower in connection with the issuance of Letters of Credit
in accordance with the usual and customary practices of the Issuing Bank.
"L/C SUBLIMIT" means $2,000,000.00.
"LENDER" OR "LENDERS" means one or more of the lenders that are, or
become, lenders under, and parties to, this Agreement.
"LETTERS OF CREDIT" means Standby Letters of Credit, Sight Letters of
Credit and Time Letters of Credit issued by the Issuing Bank for the account of
the Borrower in a maximum aggregate amount which when combined with B/A's equal
an amount not in excess of the L/C Sublimit and issued pursuant to the terms and
conditions of this Agreement. Standby Letters of Credit shall be issued to
secure payment obligations of the Borrower incurred in the ordinary course of
business and shall be issued in all cases, with an expiry date. Sight Letters of
Credit and Time Letters of Credit shall be issued hereunder for the purpose of
providing the primary payment mechanism in connection with the purchase by
Borrower and DPI of goods in the ordinary course of business of the Borrower and
DPI.
"LIBOR RATE" means the rate (rounded upwards, if not already a whole
multiple of 1/16th of one (1%) percent, to the next higher of 1/16th of one (1%)
percent) at which dollar deposits approximately equal in principal amount to the
requested Eurodollar Loan and for a maturity equal to the requested Interest
Period are offered in immediately available funds to the London office of the
Administrative Agent by leading banks in the London interbank market for
Eurodollars at approximately 11:00 a.m., London time, two (2) Business Days
prior to the commencement of such Interest Period.
-15-
"LIEN" means any mortgage, deed of trust, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), or preference, priority, or other security agreement or preferential
arrangement, charge, or encumbrance of any kind or nature whatsoever, including,
without limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction to evidence any of the
foregoing.
"LOAN" OR LOANS" means the Revolving Credit Loans or any or all of the
same as the context may require and includes Alternate Base Rate Loans and
Eurodollar Loans, as the context may require.
"LOAN DOCUMENTS" means this Agreement, the Note, the Guaranties, the
L/C Documents and any other document executed or delivered pursuant to this
Agreement other than any documents or agreements delivered in connection with
the Existing Collateral Documents.
"MATERIAL ADVERSE CHANGE" means, as to the Borrower alone, DPI alone,
any other Guarantor which has revenues or assets representing more than ten
(10%) percent of the Borrower's consolidated revenues or assets (a "Material
Guarantor")or the Borrower and its Consolidated Subsidiaries taken as a whole,
(i) a material adverse change in the financial condition, business, operations,
properties, prospects or results of operations of the Borrower alone, DPI alone,
a Material Guarantor alone or the Borrower and its Consolidated Subsidiaries
taken as a whole (provided that the elimination of the inter-company payable
between the Borrower and DPI shall not, by virtue of such elimination alone, be
deemed a Material Adverse Change in either the Borrower or DPI) or (ii) any
event or occurrence which could have a material adverse effect on the ability of
the Borrower alone, DPI alone, a Material Guarantor alone or the Borrower and
its Consolidated Subsidiaries taken as a whole to perform its or their
obligations under the Loan Documents.
"MATURITY DATE" means the third anniversary of the Closing Date.
"MULTIEMPLOYER PLAN" means a Plan described in Section 4001(a)(3) of
ERISA which covers employees of the Borrower or any ERISA Affiliate.
-16-
"NORTH CAROLINA EXPANSION" means the expansion by the Borrower of its
existing manufacturing facility located in Rocky Point, North Carolina.
"NORTH CAROLINA MORTGAGE" means the mortgage Lien existing on the date
of this Agreement, or refinanced hereafter, on the Borrower's real property and
the improvements thereon at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
provided that any refinance of the existing mortgage (i) shall secure a
principal amount of not more than $20,000,000.00, (ii) if it is a construction
or building loan mortgage, shall be from a lender which has also issued to
Borrower a permanent loan take out commitment meeting the requirements of
clauses (iii) and (iv) below, (iii) shall be for a term (including any
construction and permanent loan terms) of not less than five (5) years, (iv)
shall have an amortization schedule requiring annual payments of not more than
one-fifth (1/5th) of the original principal amount of the loan or, if it is a
construction or building loan, of the maximum amount available under such loan
and (v) no Event of Default shall have occurred and be continuing at the time of
such refinance or shall result from such refinance and the Borrower shall have
provided the Administration Agent and the Lenders reasonable evidence that after
giving effect to such refinance, it will remain in compliance with the terms and
conditions of this Agreement, including, without limitation, Section 5.03.
"NOTE" or "NOTES" means the Revolving Credit Notes or any or all of the
same as the context may require.
"OUTSTANDING L/C EXPOSURE" means, at any time, the aggregate of (i) the
amount available to be drawn on all outstanding Letters of Credit, (ii) the
aggregate amount of all unmatured B/As, other drafts accepted and deferred
payment obligations incurred by the Issuing Bank under any Letters of Credit and
(iii) the amount of any payments made by the Issuing Bank under any Letters of
Credit that has not been reimbursed by the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED DIVIDENDS" means, with respect to the Borrower, the payment
of (i) any dividend payable in stock of the Borrower or (ii) subject to the
proviso at the end of this definition, cash dividends which in any fiscal year
of the Borrower, when combined with the amount of Permitted Open Market Stock
Repurchases during such fiscal year do not exceed, in the aggregate,
$4,000,000.00; provided, however, (x) no Default or Event of Default shall have
occurred and be continuing or shall result from the payment of such cash
dividend and (y) the Borrower shall have provided to the Administrative Agent
and the Lenders evidence that, after giving effect to the paying of such cash
dividend, it will remain in compliance with the terms and covenants of this
Agreement, including, without limitation, Section 5.03.
-17-
"PERMITTED EQUIPMENT SALES" means sales by the Borrower or its
Consolidated Subsidiaries of equipment in an aggregate principal amount not
exceeding $500,000.00 during any fiscal year.
"PERMITTED INVESTMENTS" means, (i) direct obligations of the United
States of America or any governmental agency thereof, or obligations guaranteed
by the United States of America, provided that such obligations mature within
one year from the date of acquisition thereof; (ii) time certificates of deposit
having a maturity of one year or less issued by any commercial bank organized
and existing under the laws of the United States or any state thereof and having
aggregate capital and surplus in excess of $500,000,000.00; (iii) money market
mutual funds having assets in excess of $2,500,000,000; (iv) commercial paper
rated not less than P-1 or A-1 or their equivalent by ▇▇▇▇▇'▇ Investor Services,
Inc. or Standard & Poor's Corporation, respectively; (v) tax exempt securities
rated not less than Prime 2 or its equivalent by ▇▇▇▇▇'▇ Investor Services, Inc.
or not less than A-1 or its equivalent by Standard & Poor's Corporation; (vi)
loans or advances between the Borrower and a Guarantor or between Guarantors;
(vii) deposits, whether in Dollars or eurodollars, commercial paper, cash
reserve deposits, repurchase agreements or any similar short term investments
made available by any Lender or any Affiliate of Lender; (viii) investments,
loans or advances in wholly owned domestic Subsidiaries, provided that any such
investment, loan or advance made after the date of this Agreement shall be made
only in a domestic Subsidiary which is a Guarantor; (ix) investments in, or
loans or advances to, Foreign Subsidiaries, provided any such single investment
(valued at cost), loan or advance shall not exceed $10,000,000.00 and all such
investments (valued at cost), loans and advances shall not exceed
$12,500,000.00; (x) loans or advances to employees of the Borrower or a
Guarantor which do not exceed $2,000,000.00 in the aggregate at any time; and
(xi) bonds issued by the State of Israel in an aggregate amount not exceeding
$250,000.00 (valued at cost) at any time.
"PERMITTED OPEN MARKET STOCK REPURCHASE" means the purchase of common
stock of the Borrower in open market purchases, provided, however, such
purchases, when combined with the amount of Permitted Dividends paid in cash
during a fiscal year, shall not exceed $4,000,000.00 in the aggregate during
such fiscal year of the Borrower, provided, however, (x) no Default or Event of
Default shall have occurred and be continuing or shall result from such open
market purchase and (y) the Borrower shall have provided to the Administrative
Agent and the Lenders reasonable evidence that, after giving effect to such
purchase, it will remain in compliance with the terms and covenants of this
Agreement, including, without limitation, Section 5.03.
-18-
"PERMITTED REAL ESTATE SALE" means (i) the sale by each of the Borrower
and 565 of (i) its real property and the improvements thereon located at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ or (ii) the sale by the Borrower of its
real property and the improvements thereon located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ provided that, in the case of either of such properties, such
sale shall (x) be for cash and (y) be in an arms length transaction with a
Person who or which is not an Affiliate of the Borrower.
"PERMITTED STOCK REPURCHASES" means, with respect to the Borrower, (i)
transactions in which (x) the Borrower's common stock is transferred to the
Borrower by a current or former employee of the Borrower or any of its
Subsidiaries in an amount equal to the consideration payable to such employee
upon the exercise of stock options held by such employee or (y) the Borrower's
common stock is transferred to the Borrower by an employee in an amount equal to
the withholding tax liability for such employee resulting from the exercise of
such stock option rights by such employee, provided that the amount paid by the
Borrower for transactions described in clause (y) (net of the related tax
benefit received by the Borrower for such transaction) shall not exceed
$500,000.00 in the aggregate during any fiscal year of the Borrower, (ii) the
repurchase of common stock of the Borrower from participants in the Del
Laboratories, Inc. Employee Stock Ownership Trust (the "ESOT") and from the ESOT
and (iii) Permitted Open Market Stock Repurchases.
"PERSON" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity or a federal, state or
local government, or a political subdivision thereof or any agency of such
government or subdivision.
"PLAN" means any employee benefit plan established or maintained by the
Borrower or any ERISA Affiliate.
"PRIME RATE" means the rate per annum announced by the Administrative
Agent from time to time as its prime rate in effect at its principal office on a
360-day basis; each change in the Prime Rate shall be effective on the date such
change is announced to become effective.
"PROHIBITED TRANSACTION" means any non-exempt transaction set forth in
Section 406 of ERISA or Section 4975 of the Internal Revenue Code of 1986, as
amended from time to time.
"PRO RATA SHARE" means, with respect to each Lender, its pro rata share
of the Total Commitment, as set forth in Schedule 1.01 annexed hereto as the
same may be modified by any assignment of all or any part of such Lender's
Commitment.
-19-
"REGULATION D" means Regulation D of the Board of Governors, as the
same may be amended and in effect from time to time.
"REGULATION T" means Regulation T of the Board of Governors, as the
same may be amended and in effect from time to time.
"REGULATION U" means Regulation U of the Board of Governors, as the
same may be amended and in effect from time to time.
"REGULATION X" means Regulation X of the Board of Governors, as the
same may be amended and in effect from time to time.
"RELEASE AND TERMINATION AGREEMENT" means the agreement in
substantially the form of Exhibit C hereto executed and delivered by the Lenders
under the February 2000 Amendment, the Senior Note Holders and the Collateral
Agent and acknowledged by the Borrower, pursuant to which the Lenders under the
February 2000 Amendment, the Senior Note Holders and the Collateral Agent
consent to (i) the release of the Liens granted to the Collateral Agent pursuant
to the Existing Collateral Documents and (ii) the termination of the Existing
Collateral Documents.
"REPORTABLE EVENT" means any of the events set forth in Section 4043 of
ERISA, other than an event for which the reporting requirements have been
waived.
"REQUIRED LENDERS" means (i) at any time there are Loans outstanding,
those Lenders having, in the aggregate, sixty six (66%) percent of such Loans
and (ii) at any time when there are no Loans outstanding those Lenders having,
in the aggregate, sixty six (66%) percent of the Total Commitment.
"REVOLVING CREDIT LOANS" shall have the meaning assigned to such term
in Section 2.01 of this Agreement.
"REVOLVING CREDIT NOTE" OR "REVOLVING CREDIT NOTES" means one or more,
as the context requires, of the promissory notes of the Borrower payable to the
order of each of the Lenders, in substantially the form of Exhibit A annexed
hereto, evidencing the aggregate indebtedness of the Borrower to each such
Lender resulting from Revolving Credit Loans made by such Lender to the Borrower
pursuant to this Agreement.
"SENIOR NOTE AGREEMENT" means that certain Amended and Restated Loan
Agreement dated as of February 25, 2000 among the Borrower, the Guarantors and
▇▇▇▇▇▇▇ National Life Insurance Company, as amended by the Senior Note
Amendment.
-20-
"SENIOR NOTE AMENDMENT" means an amendment to the Senior Note
Agreement, in form and substance satisfactory to the Administrative Agent and
its counsel, pursuant to which the Senior Note Agreement is amended (i) to
conform all the covenants therein to the covenants of this Agreement and (ii) to
provide for the release of the Collateral and the termination of the Existing
Collateral Documents.
"SENIOR NOTE HOLDERS" means ▇▇▇▇▇▇▇ National Life Insurance Company,
and its successors and assigns, which is, or are, a party or parties to, and a
lender or lenders under, the Senior Note Agreement.
"SENIOR NOTES" means the amended and restated promissory note, executed
and delivered by the Borrower and evidencing the loans made to the Borrower, in
the current principal amount of $36,000,000.00, pursuant to the Senior Note
Agreement.
"SIGHT LETTERS OF CREDIT" means letters of credit wherein the draft is
drawn at sight (i.e., drawn payable upon presentment).
"STANDBY LETTERS OF CREDIT" means letters of credit issued to secure a
payment obligation of the Borrower incurred in the ordinary course of business.
"STATUTORY RESERVES" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including, without
limitation, any marginal, special, emergency, or supplemental reserves)
expressed as a decimal established by the Board of Governors or any other
banking authority to which the Administrative Agent is subject with respect to
the Adjusted LIBOR Rate for Eurocurrency Liabilities (as defined in Regulation
D). Such reserve percentages shall include, without limitation, those imposed
under such Regulation D. Eurodollar Loans shall be deemed to constitute
Eurocurrency Liabilities and as such shall be deemed to be subject to such
reserve requirements without benefit of or credit for proration, exceptions or
offsets which may be available from time to time to the Administrative Agent
under such Regulation D. Statutory Reserves shall be adjusted automatically on
and as of the effective date of any change in any reserve percentage.
"SUBORDINATED DEBT" means Debt of any Person, the repayment of which
the obligee has agreed in writing, on terms which have been approved by the
Administrative Agent and the Required Lenders in advance in writing, shall be
subordinate and junior to the rights of the Administrative Agent and the Lenders
with respect to Debt owing from such Person to the Administrative Agent and the
Lenders.
-21-
"SUBSIDIARY" means, as to any Person, any corporation, partnership,
limited liability company or joint venture whether now existing or hereafter
organized or acquired (i) in the case of a corporation, of which a majority of
the securities having ordinary voting power for the election of directors (other
than securities having such power only by reason of the happening of a
contingency) are at the time owned by such Person and/or one or more
Subsidiaries of such Person or (ii) in the case of a partnership, limited
liability company or joint venture or similar entity, of which a majority of the
partnership, membership or other ownership interests are at the time owned by
such Person and/or one or more Subsidiaries of such Person.
"TIME LETTERS OF CREDIT" means Letters of Credit which provide for
payment on a specific maturity date determined in accordance with such Letters
of Credit.
"TOTAL COMMITMENT" means the aggregate of the Commitments of each of
the Lenders, which, on the date of this Agreement, is $45,000,000.00.
"UNFUNDED CAPITAL EXPENDITURES" means Capital Expenditures financed
other than by the incurrence of Debt, provided, however that any Capital
Expenditures financed by Resolving Credit Loans shall be considered Unfunded
Capital Expenditures.
SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to and including".
SECTION 1.03. ACCOUNTING TERMS. Except as otherwise herein specifically
provided, each accounting term used herein shall have the meaning given to it
under GAAP.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
-22-
ARTICLE II
AMOUNT AND TERMS OF THE LOANS
SECTION 2.01. THE REVOLVING CREDIT LOANS. (a) The Lenders agree,
severally, but not jointly, on the date of this Agreement, on the terms and
conditions of this Agreement and in reliance upon the representations and
warranties of the Borrower and the Guarantors set forth in this Agreement, to
lend to the Borrower prior to the Maturity Date such amounts as the Borrower may
request from time to time (individually, a "Revolving Credit Loan" or
collectively, the "Revolving Credit Loans"), which amounts may be borrowed,
repaid and reborrowed, provided that (i) the aggregate amount of such Revolving
Credit Loans outstanding at any one time shall not exceed the Total Commitment,
or such lesser amount of the Total Commitment as it may be reduced pursuant to
Section 2.08 (a) hereof, (ii) Aggregate Outstandings shall not at any one time
exceed the Total Commitment as in effect at such time and (iii) each Lender's
Pro Rata Share of Aggregate Outstandings shall not exceed such Lender's
Commitment. On the date of this Agreement, all the Existing Letters of Credit
shall be deemed to be Outstanding L/C Exposure under this Agreement.
(b) Each Revolving Credit Loan shall be an Alternate Base Rate
Loan or a Eurodollar Loan (or a combination thereof) as the Borrower may request
subject to and in accordance with Section 2.02. Any Lender may at its option
make any Eurodollar Loan by causing a foreign branch or affiliate to make such
Loan, provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of the
applicable Revolving Credit Note. Subject to the other provisions of this
Agreement, Revolving Credit Loans of more than one type may be outstanding at
the same time, provided not more than six (6) Eurodollar Loans may be
outstanding at the same time.
SECTION 2.02. REVOLVING CREDIT LOANS; NOTICE, CONTINUATION AND
CONVERSION.
(a) Each Revolving Credit Loan shall be (i) in the case of each
Alternate Base Rate Loan in the minimum principal amount of $500,000.00 and (ii)
in the case of each Eurodollar Loan in the minimum principal amount of
$2,000,000.00 and in increased integral multiples of $100,000.00 (except that,
if any such Alternate Base Rate Loan so requested shall exhaust the remaining
available Total Commitment, such Alternate Base Rate Loan may be in an amount
equal to the amount of the remaining available Total Commitment).
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(b) The Borrower shall give the Administrative Agent irrevocable
written, telex, telephonic (immediately confirmed in writing) or facsimile
notice (i) at least three (3) Business Days prior to each Revolving Credit Loan
comprised in whole or in part of one or more Eurodollar Loans (subject to
availability, including, without limitation, the conditions set forth in (c)
below) or (ii) prior to 11:00 a.m. on the day of each Revolving Credit Loan
consisting solely of an Alternate Base Rate Loan. Such notice shall specify the
date of such borrowing, the amount thereof and whether such Loan is to be (or
what portion or portions thereof are to be) an Alternate Base Rate Loan or a
Eurodollar Loan and, if such Loan or any portion thereof is to consist of one or
more Eurodollar Loans, the principal amounts thereof and Interest Period or
Interest Periods with respect thereto. If no election as to the Interest Period
is specified in such notice with respect to any Eurodollar Loan, the Borrower
shall be deemed to have selected an Interest Period of one month's duration and
if a Eurodollar Loan is requested when such Loans are not available, the
Borrower shall be deemed to have requested an Alternate Base Rate Loan.
(c) The Borrower shall have the right, on such notice to the
Administrative Agent as is required pursuant to (b) above, (i) to continue any
Eurodollar Loan or a portion thereof into a subsequent Interest Period (subject
to availability) or (ii) to convert an Alternate Base Rate Loan into a
Eurodollar Loan (subject to availability) subject to the following:
(1) if an Event of Default shall have occurred and be
continuing at the time of any proposed conversion or continuation only Alternate
Base Rate Loans shall be available;
(2) in the case of a continuation or conversion of fewer than
all Loans, the aggregate principal amount of each Eurodollar Loan continued or
into which a Loan is converted shall be in the minimum principal amount of
$2,000,000.00 and in increased integral multiples of $100,000.00;
(3) each continuation or conversion of a Eurodollar Loan shall
be effected by the new Loan replacing the Loan (or portion thereof) being
continued or converted;
(4) if the new Loan made as a result of a continuation or
conversion shall be a Eurodollar Loan, the first Interest Period with respect
thereto shall commence on the date of continuation or conversion;
(5) each request for a Eurodollar Loan which shall fail to
state an applicable Interest Period shall be deemed to be a request for an
Interest Period of one month and each request for a Eurodollar Loan made when
such Loans are not available shall be deemed to be a request for an Alternate
Base Rate Loan; and
(6) in the event that the Borrower shall not give notice to
continue a Eurodollar Loan as provided above, such Loan shall automatically be
converted into an Alternate Base Rate Loan at the expiration of the then current
Interest Period.
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(d) Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender of the contents thereof and of the amount, type and
other relevant information regarding the Loan requested. Thereupon, each Lender
shall, not later than 2:00 p.m. (New York time), transfer immediately available
funds equal to such Lender's Pro Rata Share of the requested Loan to the
Administrative Agent, which, provided the conditions of Sections 3.01 and 3.02
of this Agreement have been met, and provided the Lenders have made such
transfers, shall thereupon transfer immediately available funds equal to the
requested Loan to the Borrower's account with the Administrative Agent. If a
notice of borrowing is received by the Administrative Agent after 11:00 a.m. on
a Business Day, such notice shall be deemed to have been given on the next
succeeding Business Day. Any Lender's failure to make any requested Loan shall
not relieve any other Lender of its obligation to make such Loan, but such other
Lender shall not be liable for such failure of the first Lender.
(e) Unless the Administrative Agent shall have received notice from a
Lender prior to 2:00 p.m. (New York time) on the requested date, that such
Lender will not make available to the Administrative Agent the Loan requested to
be made on such date, the Administrative Agent may assume that such Lender has
made such Loan available to the Administrative Agent on such date in accordance
with Section 2.02(d) hereof and the Administrative Agent in its sole discretion
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount on behalf of such Lender. If and to the extent such
Lender shall not have so made available to the Administrative Agent the Loan
requested to be made on such date and the Administrative Agent shall have so
made available to the Borrower a corresponding amount on behalf of such Lender,
such Lender shall, on demand, pay to the Administrative Agent such corresponding
amount together with interest thereon, at the Federal Funds Effective Rate, for
each day from the date such amount shall have been so made available by the
Administrative Agent to the Borrower until the date such amount shall have been
repaid to the Administrative Agent. If such Lender does not pay such
corresponding amount promptly upon the Administrative Agent's demand therefor,
the Administrative Agent shall promptly notify the Borrower and the Borrower
shall, with reservation of rights against such Lender, not later than one (1)
Business Day following such notice, repay such corresponding amount to the
Administrative Agent together with accrued interest thereon at the applicable
rate or rates provided (i) in Section 2.04 hereof or (ii) if the Borrower fails
to repay such corresponding amount within three (3) Business Days after such
notice, in Section 2.18 hereof.
SECTION 2.03. REVOLVING CREDIT NOTES. Revolving Credit Loans shall be
evidenced by the Revolving Credit Notes of the Borrower. Each Lender's Revolving
Credit Note shall be dated the date hereof and be in the principal amount of
such Lender's Pro Rata Share of the Total Commitment, and shall mature on the
Maturity Date, at which time the entire outstanding principal balance and all
interest thereon shall be due and payable and the Commitment shall be
terminated. The Revolving Credit Notes shall be entitled to the benefits and
subject to the provisions of this Agreement.
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At the time of the making of each Revolving Credit Loan and at the time
of each payment of principal thereon, the holder of each Revolving Credit Note
is hereby authorized by the Borrower to make a notation on the schedule annexed
to the Revolving Credit Note of the date and amount, and the type and Interest
Period of the Revolving Credit Loan or payment, as the case may be. Failure to
make a notation with respect to any Revolving Credit Loan shall not limit or
otherwise affect the obligation of the Borrower hereunder or under the Revolving
Credit Notes with respect to such Revolving Credit Loan, and any payment of
principal on the Revolving Credit Notes by the Borrower shall not be affected by
the failure to make a notation thereof on said schedule.
SECTION 2.04. PAYMENT OF INTEREST ON THE REVOLVING CREDIT NOTES.
(a) In the case of an Alternate Base Rate Loan, interest shall be
payable at a rate per annum (computed on the basis of the actual number of days
elapsed over a year of 360 days) equal to the Alternate Base Rate plus the
Applicable Margin. Such interest shall be payable on each Interest Payment Date,
commencing with the first Interest Payment Date after the date of such Alternate
Base Rate Loan, on each Interest Determination Date and on the Maturity Date.
Any change in the rate of interest on the Revolving Credit Note due to a change
in the Alternate Base Rate shall take effect as of the date of such change in
the Alternate Base Rate.
(b) In the case of a Eurodollar Loan, interest shall be payable at a
rate per annum (computed on the basis of the actual number of days elapsed over
a year of 360 days) equal to the Adjusted LIBOR Rate plus the Applicable Margin.
Such interest shall be payable on each Interest Payment Date, commencing with
the first Interest Payment Date after the date of such Eurodollar Loan, on each
Interest Determination Date and on the Maturity Date. In the event Eurodollar
Loans are available, the Administrative Agent shall determine the rate of
interest applicable to each requested Eurodollar Loan for each Interest Period
at 11:00 a.m., New York City time, or as soon as practicable thereafter, two (2)
Business Days prior to the commencement of such Interest Period and shall notify
the Lenders and the Borrower of the rate of interest so determined. Such
determination shall be conclusive absent manifest error.
(c) All interest on the Revolving Credit Notes shall be paid to the
Administrative Agent for the pro rata distribution to the Lenders.
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SECTION 2.05. APPLICABLE MARGIN The Applicable Margin for Revolving
Credit Loans shall be determined on the basis of the Borrower's Cash Flow
Coverage Ratio, as calculated based on the Borrower's consolidated financial
statements for its most recent fiscal year or quarter. The Administrative Agent
shall determine the Applicable Margin within five (5) Business Days after it has
received the financial statements of the Borrower as required by Section
5.01(b)(i) or (ii), as applicable. The Administrative Agent shall promptly
notify the Borrower and the Lenders of such determination, which shall be
conclusive, in the absence of manifest error. The Applicable Margin shall be
determined as follows:
(a) The initial Applicable Margin shall be -0- basis points for
Alternate Base Rate Loans and 175 basis points for Eurodollar Loans and shall be
applicable until five (5) Business Days after delivery of the Borrower's
consolidated financial statements for its fiscal year ending December 31, 2001
pursuant to Section 5.01(b) hereof.
(b) Beginning five (5) Business Days after delivery of the
Borrower's consolidated financial statements for the fiscal year ending December
31, 2001, and for each fiscal year or quarter thereafter:
(i) If the Borrower's Cash Flow Coverage Ratio as of the end
of such fiscal year or quarter is less than or equal to 1.00 to 1.00, the
Applicable Margin shall be -0- basis points for Alternate Base Rate Loans and
225 basis points for Eurodollar Loans.
(ii) If the Borrower's Cash Flow Coverage Ratio as of the end
of such fiscal year or quarter is greater than 1.00 to 1.00 but less than or
equal to 1.25 to 1.00, the Applicable Margin shall be -0- basis points for
Alternate Base Rate Loans and 175 basis points for Eurodollar Loans.
(iii) If the Borrower's Cash Flow Coverage Ratio as of the end
of such fiscal year or quarter is greater than 1.25 to 1.00, the Applicable
Margin shall be -0- basis points for Alternate Base Rate Loans and 150 basis
points for Eurodollar Loans.
The Applicable Margin for any Eurodollar Loan shall change during the
term of such Eurodollar Loan as a result of this Section 2.05.
In the event that the Borrower fails to deliver any financial
statements and the related certificate on the due date therefor set forth in
Section 5.01(b)(i) or (ii) hereof, unless an Event of Default is declared as a
result of such failure, the Applicable Margin shall be -0- basis points for
Alternate Base Rate Loans and 225 basis points for Eurodollar Loans until the
Borrower delivers all required financial statements and certificates at which
time the Applicable Margin shall be redetermined as provided for in this Section
2.05.
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Upon the occurrence and during the continuance of a Default or an Event
of Default, in addition to the increase in interest rates provided for in
Section 2.18(b) of this Agreement, the Applicable Margin may, as a result of
changes in the Borrower's Cash Flow Coverage Ratio, increase but will not
decrease.
SECTION 2.06 USE OF PROCEEDS. The proceeds of the Revolving Credit
Loans shall be used by the Borrower (i) for working capital needs of the
Borrower and its Consolidated Subsidiaries, including the issuance of Letters of
Credit in accordance with the terms and subject to the provisions of this
Agreement, (ii) to finance Capital Expenditures of the Borrower and its
Consolidated Subsidiaries or (iii) for general corporate purposes. No part of
the proceeds of any Loan may be used for any purpose that directly or indirectly
violates or is inconsistent with, the provisions or Regulations T, U or X.
SECTION 2.07. COMMITMENT FEE; OTHER FEES. (a) The Borrower agrees to
pay to the Administrative Agent, for the pro rata distribution to the Lenders,
from the date of this Agreement and for so long as the Total Commitment remains
in effect, on the last Business Day of each calendar quarter, a commitment fee
computed at the rate of one quarter of one (1/4%) percent per annum (computed on
the basis of the actual number of days elapsed over 360 days) on the average
daily unused amount of the Total Commitment, such commitment fee being payable
for the calendar quarter, or part thereof, preceding the payment date.
(b) The Borrower agrees to pay to the Administrative Agent, for its
account, the fees set forth in the Fee Letter, at the times and in the amounts
set forth in the Fee Letter.
SECTION 2.08. REDUCTIONS OF TOTAL COMMITMENT. Upon at least three (3)
Business Days' written notice to the Administrative Agent, the Borrower may
irrevocably elect to have the Total Commitment terminated in whole or reduced in
part provided, however, that any such partial reduction shall be in a minimum
amount of $1,000,000.00, or whole multiples thereof. The Total Commitment, once
terminated or reduced, shall not be reinstated without the express written
approval of the Administrative Agent and the Lenders. Any reduction of the Total
Commitment shall be applied pro rata to the respective Commitments of the
Lenders. On the date any reduction in the Total Commitment becomes effective,
the Borrower shall, without notice or demand from the Administrative Agent or
the Lenders, prepay Revolving Credit Loans, subject to the provisions of Section
2.10 of this Agreement, such that, following such prepayment, the Aggregate
Outstandings shall not exceed the Total Commitment, as reduced.
SECTION 2.09. PREPAYMENT. (a) The Borrower shall have the right at any
time and from time to time to prepay any Alternate Base Rate Loan, in whole or
in part, without premium or penalty on the same day on which telephonic notice
is given to the Administrative Agent (immediately confirmed in writing) of such
prepayment provided, however, that each such prepayment shall be on a Business
Day and shall be in a minimum principal amount of $250,000.00.
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(b) The Borrower shall have the right at any time and from time to
time, subject to the provisions of this Agreement, to prepay any Eurodollar
Loan, in whole or in part, on three (3) Business Days' prior irrevocable written
notice to the Administrative Agent, provided, however, that (i) each such
prepayment shall be on a Business Day and shall be in a minimum principal amount
of $500,000.00 and in increased integral multiples of $100,000.00 and (ii) each
such prepayment shall be subject to the provisions of Section 2.10 of this
Agreement.
(c) The notice of prepayment under this Section 2.09 shall set
forth the prepayment date and the principal amount of the Loan being prepaid and
shall be irrevocable and shall commit the Borrower to prepay such Loan by the
amount and on the date stated therein. All prepayments shall be accompanied by
accrued interest on the principal amount being prepaid to the date of
prepayment. Each prepayment under this Section 2.09 shall be applied first
towards unpaid interest on the amount being prepaid and then towards the
principal in whole or partial prepayment of Loans by the Borrower. In the
absence of such specification, amounts being prepaid shall be applied first to
any Alternate Base Rate Loan then outstanding and then to Eurodollar Loans in
the order of the expiration of their respective Interest Periods. All
prepayments shall be applied pro rata among the Lenders.
SECTION 2.10. REIMBURSEMENT BY BORROWER. The Borrower shall reimburse
the Administrative Agent, on behalf of a Lender, upon the Administrative Agent's
demand, for any loss, cost or expense incurred or to be incurred by such Lender
(in such Lender's sole determination) as a result of any prepayment or
conversion (whether voluntarily or by acceleration) of any Eurodollar Loan other
than on the last day of the Interest Period for such Loan, or if the Borrower
fails to borrow the Eurodollar Loan (or is not able to borrow because of a
Default or an Event of Default or for any other reason hereunder) after having
given the irrevocable notice of borrowing required by this Agreement. Such
reimbursement shall include, but not be limited to, any loss, cost or expense
incurred by such Lender in obtaining, liquidating or redeploying any funds used
or to be used in making or maintaining the Eurodollar Loan.
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SECTION 2.11. STATUTORY RESERVES. It is understood that the cost to the
Lenders of making or maintaining Eurodollar Loans may fluctuate as a result of
the applicability of, or change in, Statutory Reserves. The Borrower agrees to
pay to the Administrative Agent, on behalf of the Lenders from time to time, as
provided in Section 2.12 below, such amounts as shall be necessary to compensate
each Lender for the portion of the cost of making or maintaining any Eurodollar
Loans made by it resulting from any such Statutory Reserves, or change therein,
it being understood that the rates of interest applicable to Eurodollar Loans
hereunder have been determined on the basis of Statutory Reserves in effect at
the time of determination of the Adjusted LIBOR Rate, and that such rate does
not reflect costs imposed on such Lender in connection with any change to such
Statutory Reserves. It is agreed that, for purposes of this paragraph, the
Eurodollar Loans made hereunder shall be deemed to constitute Eurocurrency
Liabilities as defined in Regulation D and to be subject to the reserve
requirements of Regulation D without benefit or credit of proration, exemptions
or offsets which might otherwise be available to a Lender from time to time
under Regulation D.
SECTION 2.12. INCREASED COSTS. If, after the date of this Agreement,
the adoption of, or any change in, any applicable law, regulation, rule or
directive, or any interpretation thereof by any authority charged with the
administration or interpretation thereof:
(i) subjects the Administrative Agent, the Issuing Bank or any
Lender to any tax with respect to its Commitment, the Loans, the Notes, the
Letters of Credit, Outstanding L/C Exposure or on any amount paid or to be paid
under or pursuant to this Agreement, its Commitment, the Loans, the Notes, the
Letters of Credit or Outstanding L/C Exposure (other than any tax measured by or
based upon the overall net income of the Administrative Agent, the Issuing Bank
or such Lender);
(ii) changes the basis of taxation of payments to the
Administrative Agent, the Issuing Bank or a Lender of any amounts payable
hereunder (other than any tax measured by or based upon the overall net income
of the Administrative Agent, the Issuing Bank or such Lender);
(iii) imposes, modifies or deems applicable any reserve,
capital adequacy or deposit requirements against any assets held by, deposits
with or for the account of, loans made by, or letters of credit issued by, the
Issuing Bank or a Lender; or
(iv) imposes on the Administrative Agent, the Issuing Bank or
a Lender any other condition affecting its Commitment, the Loans, the Notes, the
Letters of Credit, Outstanding L/C Exposure or this Agreement; and the result of
any of the foregoing is to increase the cost to the Administrative Agent, the
Issuing Bank or such Lender of maintaining this Agreement or its Commitment or
making the Loans, or issuing the Letter of Credit or creating B/As or to reduce
the amount of any payment (whether of principal, interest or otherwise)
receivable by the Administrative Agent, the Issuing Bank or such Lender or to
require the Administrative Agent, the Issuing Bank or such Lender to make any
payment on or calculated by reference to the gross amount of any sum received by
it, in each case by an amount which the Administrative Agent, the Issuing Bank
or such Lender in its reasonable judgment deems material, then and in any such
case:
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(a) the Issuing Bank or the Lender shall promptly advise the
Administrative Agent and the Borrower of such event, together with the date
thereof, the amount of such increased cost or reduction or payment and the way
in which such amount has been calculated; and
(b) the Borrower shall pay to the Administrative Agent, on behalf
of itself, the Issuing Bank or such Lender, as applicable, within ten (10) days
after the advice referred to in subsection (a) hereinabove, such an amount or
amounts as will compensate the Administrative Agent, the Issuing Bank or such
Lender, as applicable, for such additional cost, reduction or payment for so
long as the same shall remain in effect.
The determination of the Administrative Agent, the Issuing Bank or a
Lender as to additional amounts payable pursuant to this Section 2.12 shall be
conclusive evidence of such amounts absent manifest error.
SECTION 2.13. CAPITAL ADEQUACY. If the Administrative Agent, the
Issuing Bank or any Lender shall have determined that the applicability of any
law, rule, regulation or guideline, or the adoption after the date hereof of any
other law, rule, regulation or guideline regarding capital adequacy, or any
change in any of the foregoing or in the interpretation or administration of any
of the foregoing by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Administrative Agent, the Issuing Bank or such Lender (or any lending
office of such Lender) or the Administrative Agent's, the Issuing Bank's or such
Lender's holding company with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on the Administrative Agent's, the Issuing Bank's or such Lender's
capital or on the capital of the Administrative Agent's, the Issuing Bank's or
such Lender's holding company, if any, as a consequence of its obligations
hereunder to a level below that which the Administrative Agent, the Issuing Bank
or such Lender or the Administrative Agent's, the Issuing Bank's or such
Lender's holding company could have achieved but for such adoption, change or
compliance (taking into consideration the Administrative Agent's, the Issuing
Bank's or such Lender's policies and the policies of the Administrative Agent's,
the Issuing Bank's or such Lender's holding company with respect to capital
adequacy) by an amount reasonably deemed by the Administrative Agent, the
Issuing Bank or such Lender to be material, then and in any such case:
(a) the Administrative Agent, the Issuing Bank or such Lender
shall promptly advise the Borrower of such event, together with the date
thereof, the amount of such reduction and the way in which such amount has been
calculated; and
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(b) the Borrower shall pay to the Administrative Agent, on behalf
of the Administrative Agent, the Issuing Bank or such Lender, as applicable,
within ten (10) days after the advice referred to in subsection (a) hereinabove,
such an amount or amounts as will compensate the Administrative Agent, the
Issuing Bank or such Lender or the Administrative Agent's, the Issuing Bank's or
such Lender's holding company for such reduction for so long as the same shall
remain in effect.
The determination of the Administrative Agent, the Issuing Bank or a
Lender as to additional amounts payable pursuant to this Section 2.13 shall be
conclusive evidence of such amounts absent manifest error.
SECTION 2.14. CHANGE IN LEGALITY. (a) Notwithstanding anything to the
contrary contained elsewhere in this Agreement, if any change after the date
hereof in law, rule, regulation, guideline or order, or in the interpretation
thereof by any governmental authority charged with the administration thereof,
shall make it unlawful for any Lender to make or maintain any Eurodollar Loan or
to give effect to its obligations as contemplated hereby with respect to a
Eurodollar Loan, then, by written notice to the Administrative Agent and the
Borrower, such Lender may:
(i) declare that it will not thereafter make Eurodollar Loans
hereunder, whereupon the Borrower shall be prohibited from requesting such
Eurodollar Loans from such Lender unless such declaration is subsequently
withdrawn; and
(ii) require that, subject to the provisions of Section 2.10,
all outstanding Eurodollar Loans made by such Lender be converted to an
Alternate Base Rate Loan, whereupon all of such Eurodollar Loans shall be
automatically converted to an Alternate Base Rate Loan as of the effective date
of such notice as provided in paragraph (b) below.
(b) For purposes of this Section 2.14, a notice to the Borrower by a
Lender pursuant to paragraph (a) above shall be effective, for the purposes of
paragraph (a) above, if lawful, and if any Eurodollar Loans shall then be
outstanding, on the last day of the then current Interest Period; otherwise,
such notice shall be effective on the date of receipt by the Borrower.
SECTION 2.15. INDEMNITY. The Borrower will indemnify each of the
Lenders against any loss or expense which any Lender may sustain or incur as a
consequence of any default in payment or prepayment of the principal amount of
any Eurodollar Loan or any part thereof or interest accrued thereon, as and when
due and payable (at the due date thereof, by notice of prepayment or otherwise),
or the occurrence of any Event of Default, including but not limited to any loss
or expense sustained or incurred in liquidating or re-employing deposits from
third parties acquired to affect or maintain such Eurodollar Loan or any part
thereof. When claiming under this Section 2.15, a Lender shall provide to the
Borrower a statement, signed by an officer of such Lender, explaining the amount
of any such loss or expense (including the calculation of such amount), which
statement shall, in the absence of manifest error, be conclusive with respect to
the parties hereto.
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SECTION 2.16. CHANGE IN LIBOR; AVAILABILITY OF RATES. In the event, and
on each occasion, that, on the day the interest rate for any Eurodollar Loan is
to be determined, the Administrative Agent shall have reasonably determined
(which determination, absent manifest error, shall be conclusive and binding
upon the Borrower) that dollar deposits in the amount of the principal amount of
the requested Eurodollar Loan are not generally available in the London
interbank market, or that the rate at which such dollar deposits are being
offered will not adequately and fairly reflect the cost to the Lenders of making
or maintaining the principal amount of such Eurodollar Loan during such Interest
Period, such Eurodollar Loan shall be unavailable. The Administrative Agent
shall, as soon as practicable thereafter, given written, telex or telephonic
notice of such determination of unavailability to the Borrower. Any request by
the Borrower for an unavailable Eurodollar Loan shall be deemed to have been a
request for an Alternate Base Rate Loan. After such notice shall have been given
and until the Administrative Agent shall have notified the Borrower that the
circumstances giving rise to such notice no longer exist, each subsequent
request for an unavailable Eurodollar Loan shall be deemed to be a request for
an Alternate Base Rate Loan.
SECTION 2.17. AUTHORIZATION TO DEBIT BORROWER'S ACCOUNT. The
Administrative Agent is hereby authorized to debit the Borrower's account
maintained with the Administrative Agent for (i) all scheduled payments of
principal and/or interest under the Notes, (ii) all required reimbursements and
other payments due in connection with Letters of Credit, (iii) the
Administrative Agent's fees and (iv) the commitment fee and all other amounts
due hereunder; all such debits to be made on the days such payments are due in
accordance with the terms hereof.
SECTION 2.18. LATE CHARGES; DEFAULT INTEREST. (a) If the Borrower shall
default in the payment of any principal installment of or interest on any Loan
or any other amount becoming due hereunder, the Borrower shall pay interest, to
the extent permitted by law, on such defaulted amount up to the date of actual
payment (after as well as before judgment) at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 360 days) equal to (i)
the amount of principal, interest, fees and/or other amounts due (the "Past Due
Amount") TIMES (ii) two (2%) percent in excess of the interest rate otherwise in
effect with respect to the type of Loan in connection with which the required
payments have not been made, or, if no such interest rate is in effect, two (2%)
percent in excess of the Alternate Base Rate plus the Applicable Margin for
Alternate Base Rate Loans, TIMES (iii) the number of days the Past Due Amount is
delinquent.
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(b) Upon the occurrence and during the continuation of an Event of
Default, the Borrower shall, at the demand of the Administrative Agent and the
Required Lenders, pay interest on all amounts owing under the Notes and this
Agreement (after as well as before judgment) at a rate per annum (computed on
the basis of the actual number of days elapsed over a year of 360 days) equal to
two (2%) percent in excess of the interest rate otherwise in effect hereunder,
subject to the provisions of Section 2.02(c)(1) of this Agreement.
SECTION 2.19. PAYMENTS. All payments by the Borrower hereunder or under
the Notes shall be made in Dollars in immediately available funds at the office
of the Administrative Agent by 12:00 noon, New York City time on the date on
which such payment shall be due. Interest on the Notes shall accrue from and
including the date of each Loan to but excluding the date on which such Loan is
paid in full or refinanced with a Loan of a different type.
SECTION 2.20. INTEREST ADJUSTMENTS. (a) If the provisions of this
Agreement or the Notes would at any time otherwise require payment by the
Borrower to the Lenders of any amount of interest in excess of the maximum
amount then permitted by applicable law the interest payments shall be reduced
to the extent necessary so that the Lenders shall not receive interest in excess
of such maximum amount. To the extent that, pursuant to the foregoing sentence,
the Lenders shall receive interest payments hereunder or under the Notes in an
amount less than the amount otherwise provided, such deficit (hereinafter called
the "Interest Deficit") will cumulate and will be carried forward (without
interest) until the termination of this Agreement. Interest otherwise payable to
the Lenders hereunder and under the Notes for any subsequent period shall be
increased by such maximum amount of the Interest Deficit that may be so added
without causing the Lenders to receive interest in excess of the maximum amount
then permitted by applicable law.
(b) The amount of the Interest Deficit on the Maturity Date shall
be cancelled and not paid.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE IIA
THE LETTERS OF CREDIT
SECTION 2A.01. LETTERS OF CREDIT. (a) On the terms and conditions set
forth herein, (i) the Issuing Bank agrees, from time to time on any Business Day
during the period from the date of this Agreement to the day which is thirty
(30) days prior to the Maturity Date to issue Letters of Credit and create B/A's
for the account of the Borrower or DPI and (ii) the Lenders severally agree to
participate in Letters of Credit issued and B/A's created for the account of the
Borrower or DPI. Within the foregoing limits, and subject to the other terms and
conditions hereof, the Borrower's and DPI's ability to obtain Letters of Credit
and have B/A's created shall be fully revolving, and, accordingly, the Borrower
and DPI may, during the foregoing period, obtain Letters of Credit to replace
Letters of Credit which have expired or which have been drawn upon and
reimbursed, provided that in no event shall the Outstanding L/C Exposure exceed
the L/C Sublimit.
(b) The Issuing Bank has no obligation to issue any Letter of Credit
if:
(i) any order, judgment or decree of any governmental
authority or arbitrator purports by its terms to enjoin or restrain the Issuing
Bank from issuing such Letter of Credit or any requirement of law applicable to
the Issuing Bank or any request or directive (whether or not having the force of
law) from any governmental authority with jurisdiction over the Issuing Bank
prohibits, or requests that the Issuing Bank refrain from, the issuance of
commercial letters of credit generally or such Letter of Credit in particular or
imposes upon such Issuing Bank with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which such Issuing Bank is not
otherwise compensated hereunder) not in effect on the date of this Agreement, or
imposes upon the Issuing Bank any unreimbursed loss, cost or expense which was
not applicable on the date of this Agreement and which the Issuing Bank in good
▇▇▇▇▇ ▇▇▇▇▇ material to it;
(ii) the Issuing Bank has received written notice from any
Lender, the Administrative Agent or the Borrower, on or prior to the Business
Day prior to the requested date of issuance of such Letter of Credit, that one
or more of the applicable conditions contained in Article III is not then
satisfied;
(iii) the expiry date of any requested Letter of Credit is (x)
in the case of Time Letters of Credit or Sight Letters of Credit, more than one
(1) year from its date of issuance or (y) in the case of Standby Letters of
Credit or Sight Letters of Credit later than thirty (30) Business Days prior to
the Maturity Date or (z) in the case of Time Letters of Credit, the expiry date
of any draft resulting from a draw under a Time Letter of Credit would mature
later than the Business Day which is immediately prior to the Maturity Date;
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(iv) Aggregate Outstandings, after giving effect to the
requested Letter of Credit shall exceed the Total Commitment;
(v) the L/C Documents are not in form and substance
satisfactory to the Issuing Bank; or
(vi) any requested Letter of Credit is not in form and
substance acceptable to the Issuing Bank, or the issuance of a Letter of Credit
violates any applicable policies of the Issuing Bank.
SECTION 2A.02. ISSUANCE OF LETTERS OF CREDIT. Each Letter of Credit
shall be issued upon the request of the Borrower (which request shall be
irrevocable), received by the Issuing Bank in accordance with arrangements
between the Issuing Bank and the Borrower to provide the Issuing Bank
electronically with the information necessary to issue, amend or renew Letters
of Credit. The arrangements between the Borrower and the Issuing Bank are set
forth in the L/C Documents (other than the Letters of Credit) between the
Issuing Bank and the Borrower. To the extent any term in any such L/C Documents
(other than a Letter of Credit) conflicts with or is inconsistent with the terms
of this Agreement, the term most favorable to the Issuing Bank shall apply, and
an Issuing Bank may exercise its rights under either such L/C Document or this
Agreement, but subject in any event to the provisions herein with respect to
sharing and notification. If any such inconsistency exists, the Administrative
Agent and the Lenders shall not be deemed to have waived any rights hereunder,
nor shall the Issuing Bank be deemed to have waived any rights under such L/C
Document, by reason of such inconsistency.
SECTION 2A.03. PARTICIPATIONS OF LENDERS. (a) Immediately upon the
issuance of each Letter of Credit and the creation of each B/A, each Lender
shall be deemed to, and hereby irrevocably unconditionally agrees to, purchase
from the Issuing Bank a participation in such Letter of Credit and B/A, as
applicable, each drawing thereunder in any amount and each draft accepted or
deferred payment obligation incurred in any amount under such Letter of Credit
and B/A equal in each case to the product of (i) the Pro Rata Share of each
Lender, times (ii) the maximum amount available to be drawn under such Letter of
Credit and the amount of such drawing, accepted draft or deferred payment
obligation, respectively. Each issuance of a Letter of Credit or creation of a
B/A shall be deemed to utilize the Commitment of each Lender by an amount equal
to the amount of such participation.
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(b) The Issuing Bank will promptly notify the Borrower of any
drawing under a Standby Letter of Credit or a Sight Letter of Credit. The
Borrower shall reimburse the Issuing Bank on each date that any amount is paid
by the Issuing Bank under any Standby Letter of Credit or any Sight Letter of
Credit (each such date, an "Honor Date") at such time(s) as are agreed upon by
the Borrower and the Issuing Bank, in an amount equal to the amount so paid by
the Issuing Bank. In the case of Time Letters of credit, the Borrower shall pay
to the Issuing Bank on the maturity date of each B/A, the amount of such B/A.
Any such B/A shall mature on or prior to the Maturity Date. If the Borrower
fails to reimburse the Issuing Bank for the full amount of any drawing under any
Letter of Credit at such agreed upon time on the Honor Date, or fails to pay a
B/A on its maturity date, the Issuing Bank will promptly notify the
Administrative Agent and the Administrative Agent will promptly notify each
Lender thereof.
(c) Upon receipt of any notice from the Administrative Agent of
any failure by the Borrower to reimburse or pay the Issuing Bank, each Lender
shall make available to the Administrative Agent for the account of the Issuing
Bank its pro rata share of the amount of such reimbursement or payment. If,
after receipt of such notice, any Lender fails to transfer its pro rata share of
the amount of such reimbursement or payment to the Administrative Agent,
interest shall accrue on such Lender's obligation to make such reimbursement or
payment from the Honor Date or the maturity date, as applicable, to the date
such Lender makes such payment, at a rate per annum equal to the Federal Funds
Effective Rate in effect from time to time during such period. Any failure of
the Administrative Agent to give notice to the Lenders on an Honor Date or a
maturity date, as applicable, or in sufficient time to enable any Lender to
effect such payment on such date shall not relieve such Lender from its
obligations under this subsection (c).
(d) Each Lender's payment to the Issuing Bank pursuant to Section
2A.03(c) shall be deemed payment in respect of and in satisfaction of its
participation in such Letter of Credit or B/A.
(e) Each Lender's obligation to make payment in respect of its
participation in Letters of Credit or B/As, shall be absolute and unconditional
and without recourse to the Issuing Bank and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right which such Bank may have against the Issuing Bank, the Borrower or
any other Person for any reason whatsoever; (ii) the occurrence or continuance
of a Default or any Event of Default; or (iii) any other circumstance, happening
or event whatsoever, whether or not similar to any of the foregoing.
SECTION 2A.04. REPAYMENT OF PARTICIPATIONS. (a) Upon receipt by the
Issuing Bank of (i) reimbursement from the Borrower for any payment made by the
Issuing Bank under a Letter of Credit or a B/A with respect to which any Lender
has paid for its participation in such Letter of Credit or B/A or (ii) payment
of interest thereon, the Issuing Bank will pay such amounts to the
Administrative Agent in the same funds as those received by the Issuing Bank.
The Administrative Agent shall promptly distribute to each Lender its pro rata
share thereof.
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(b) If the Administrative Agent or any Issuing Bank is required at
any time to return to the Borrower, or to a trustee, receiver, liquidator,
custodian, or any official in any insolvency proceeding, any portion of the
payments made by the Borrower to the Administrative Agent or to the Issuing Bank
pursuant to Section 2A.04(a) in reimbursement of a payment made under a Letter
of Credit or a B/A or interest thereon or fees relating thereto or as a result
of a setoff, each Lender shall, on demand of the Administrative Agent or the
Issuing Bank, as the case may be, forthwith return to the Administrative Agent
or the Issuing Bank, as the case may be, the amount of its pro rata share of any
amounts so returned by the Administrative Agent or the Issuing Bank plus
interest thereon from the date such demand is made to the date such amounts are
returned by such Lender to the Administrative Agent or the Issuing Bank, at a
rate per annum equal to the Federal Funds Effective Rate in effect from time to
time.
(c) If any event described in subsection (b) above occurs, the
obligation of the Borrower in respect of the payment or setoff required to be
returned shall be revived and continued in full force and effect as if such
payment had not been make or such setoff had not been effected.
SECTION 2A.05 ROLE OF THE ISSUING BANK. (a) The Issuing Bank shall not
have any responsibility to obtain any document in connection with paying any
draw under a Letter of Credit (other than any required sight or time draft,
certificate and other documents expressly required by the Letter of Credit) or
to ascertain or inquire as to the validity or accuracy of any such document or
the authority of the Person executing or delivering any such document.
(b) Neither the Issuing Bank nor any of its correspondents or
assignees shall be liable to any Lender for: (i) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders
(including the Required Lenders, as applicable); (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any L/C Document.
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(c) The Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; provided, however, that this assumption is not intended to, and shall
not, preclude the Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.
Neither the Administrative Agent, nor any of its officers, directors or
employees, nor any of the respective correspondents, participants or assignees
of the Issuing Bank, shall be liable or responsible for any of the matters
described in clauses (i) through (vii) of Section 2A.06; provided, however, that
the Borrower may have a claim against the Issuing Bank, and the Issuing Bank may
be liable to the Borrower, to the extent of any direct, as opposed to
consequential or exemplary, damages suffered by the Borrower which the Borrower
proves were caused by the Issuing Bank's willful misconduct or gross negligence
or the Issuing Bank's willful failure to pay under any Letter of Credit after
the presentation to it by the beneficiary of a required sight or time draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing: (i) the Issuing
Bank may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary; and (ii) the Issuing Bank shall not be responsible
for the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reasons.
SECTION 2A.06. OBLIGATIONS ABSOLUTE. The obligations of the Borrower
under this Agreement and any L/C Documents to reimburse the Issuing Bank for a
drawing under a Standby Letter of Credit or a Sight Letter of Credit and upon
the maturity date of any B/A shall be unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement and the L/C
Documents under all circumstances, including the following:
(i) any lack of validity or enforceability of this Agreement
or any L/C Document;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of the Borrower in respect
of any Letter of Credit or any other amendment or waiver of or any consent to
departure from all or any of the L/C Documents;
(iii) the existence of any claim, setoff, defense or other
right that the Borrower may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the Issuing Bank or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by the L/C Documents or any unrelated transaction;
(iv) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or otherwise
of any document required in order to make a drawing under any Letter of Credit;
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(v) any payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not strictly comply
with the terms of any Letter of Credit; or any payment made by the Issuing Bank
under any Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to any beneficiary
or any transferee of any Letter of Credit, including any arising in connection
with any insolvency proceeding;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any other guarantee, for all or any of the obligations of the Borrower in
respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Borrower.
SECTION 2A.07. UNIFORM CUSTOMS AND PRACTICES. The Uniform Customs and
Practices for Documentary Credits as published by the International Chamber of
Commerce most recently at the time of issuance of any Letter of Credit shall
(unless otherwise expressly provided in the Letters of Credit) apply to the
Letters of Credit.
SECTION 2A.08. FEES AND COMMISSIONS. (a) In the case of Standby Letters
of Credit the Borrower shall pay to the Administrative Agent a per annum
commission equal to the Applicable Margin for Eurodollar Loans at the time of
the issuance of such Standby Letter of Credit.
(b) In the case of Sight Letters of Credit, the Borrower shall pay to
the Administrative Agent a payment commission equal to the greater of (i)
$100.00 or (ii) one quarter of one (1/4%) percent of the amount drawn, payable
on the date of presentment of the required documents under the Sight Letter of
Credit.
(c) In the case of Time Letters of Credit, the Borrower shall pay
to the Administrative Agent on the date of acceptance of each draft, a per annum
commission on the face amount of each B/A and other deferred payment obligations
from the date of acceptance of the required draft under the Time Letter of
Credit to the maturity date of the draft equal to two (2%) percent, provided,
however, that the minimum amount of such commission shall not be less than
$150.00.
(d) In the case of all Letters of Credit, the Borrower shall pay
to the Issuing Bank, for its own account, its usual and customary letter of
credit fees as established from time to time, including without limitation,
fees, commissions and charges for issuance, payment, processing amendment and
expiration.
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(e) In the case of the fees and commissions set forth in (a), (b)
and (c) above, same shall be paid to the Administrative Agent for the pro rata
distribution to the Lenders.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO THE MAKING OF THE INITIAL
REVOLVING CREDIT LOAN AND THE ISSUANCE OF THE INITIAL LETTER OF CREDIT. The
obligation of the Lenders to make the initial Revolving Credit Loans
contemplated by this Agreement and the obligation of the Issuing Bank to issue
the initial Letter of Credit or create the initial B/A contemplated by this
Agreement is subject to the following conditions precedent, the satisfaction of
which shall be, and each of which shall be in form and substance, satisfactory
to the Administrative Agent, the Lenders and their counsel:
(a) The Administrative Agent shall have received the Revolving
Credit Notes duly executed and payable to the order of each of the Lenders.
(b) The Administrative Agent shall have received certified (as of
the date of this Agreement) copies of the resolutions of the Board of Directors
of the Borrower authorizing the Loans and authorizing and approving this
Agreement and the other Loan Documents and the execution, delivery and
performance thereof and certified copies of all documents evidencing other
necessary corporate action and governmental approvals, if any, with respect to
this Agreement and the other Loan Documents.
(c) The Administrative Agent shall have received certified (as of
the date of this Agreement) copies of the resolutions of the Board of Directors
and, if required under applicable law, the shareholders of each of the
Guarantors, authorizing and approving this Agreement, its Confirmation of
Guaranty and any other Loan Document applicable to such Guarantors, and the
execution, delivery and performance thereof and certified copies of all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this Agreement, its Confirmation of Guaranty
and the other Loan Documents.
(d) The Administrative Agent shall have received a certificate of
the Secretary or an Assistant Secretary (attested to by another officer) of the
Borrower certifying: (i) the names and true signatures of the officer or
officers of the Borrower authorized to sign this Agreement, the Notes and the
other Loan Documents to be delivered hereunder on behalf of the Borrower; and
(ii) there have been no amendments or modifications to the Borrower's by-laws or
certificate of incorporation since February 25, 2000.
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(e) The Administrative Agent shall have received a Certificate of
the Secretary or an Assistant Secretary (attested to by another officer) of each
of the Guarantors certifying (i) the names and true signatures of the officer or
officers of such Guarantor authorized to sign this Agreement, its Confirmation
of Guaranty and any other Loan Documents to be delivered hereunder on behalf of
such Guarantor; (ii) there have been no amendments or other modifications to
such Guarantor's by-laws or certificate of incorporation since February 25,
2000; and (iii) the stock ownership of such Guarantor.
(f) The Administrative Agent shall have received a certificate of
existence and good standing with respect to the Borrower and each Guarantor from
the Secretary of State (or equivalent officer) of the state of incorporation of
the Borrower and each Guarantor and from the Secretary of State (or equivalent
officer) of any state in which the Borrower or each Guarantor is authorized to
do business.
(g) The Administrative Agent shall have received an opinion, addressed
to the Administrative Agent and each of the Lenders, of Proskauer Rose, LLP,
counsel for the Borrower and the Guarantors as to certain matters referred to in
Article IV hereof and as to such other matters as the Administrative Agent or
its counsel may reasonably request.
(h) The Administrative Agent shall have received from each Guarantor,
an executed Confirmation of Guaranty.
(i) The Administrative Agent shall have received evidence that the
Borrower and each Guarantor maintain adequate casualty and liability insurance,
with financially sound and reputable insurance companies or associations, in
such amounts and covering such risks as are usually carried by companies engaged
in similar businesses and owning properties and doing business in the same
general areas in which the Borrower and the Guarantors operate.
(j) The Administrative Agent shall have received and satisfactorily
reviewed all credit agreements and other similar agreements described in Section
4.01(t) of this Agreement.
(k) The Administrative Agent shall have received and satisfactorily
reviewed, a copy of the Borrower's "Capital Appropriations Request" for the
North Carolina expansion, approved by senior management of the Borrower, which
shall include the costs to be incurred, the timing of the expenditures and the
cash flows resulting from the North Carolina Expansion.
(l) The Administrative Agent shall have received and satisfactorily
reviewed (x) the management prepared draft of the consolidated and consolidating
financial statements of the Borrower and its Consolidated Subsidiaries for the
fiscal year ended December 31, 2001 and a draft compliance certificate of the
Borrower for the fiscal year ended December 31, 2001 demonstrating compliance
with the covenants contained in Section 5.03 of this Agreement as in effect on
December 31, 2001 or (y) if available, the audited consolidated and
consolidating financial statements of the Borrower and its Consolidated
Subsidiaries for the fiscal year ended December 31, 2001, with a compliance
certificate as described in clause (x) above.
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(m) The Administrative Agent and the Lenders shall have received
and satisfactorily reviewed the Senior Note Amendment.
(n) The Administrative Agent and the Borrower shall have received
a copy of the Release and Termination Agreement, duly executed by each of the
parties thereto. The Collateral Agent shall have delivered to the Administrative
Agent duly executed Uniform Commercial Code termination statements, termination
statements suitable for filing in the United States Trademark Office and all
other documentation necessary to terminate the Liens granted to the Collateral
Agent for the benefit of the Lenders and the Senior Note Holders under the
February 2000 Amendment pursuant to the Existing Collateral Documents.
(o) The following statements shall be true and the Administrative
Agent shall have received a certificate signed by the President or the Chief
Financial Officer of the Borrower dated the date hereof, stating that:
(i) After giving effect to the execution and delivery of this
Agreement and the Senior Note Amendment, the representations and warranties
contained in Article IV of this Agreement and in the Loan Documents are true and
correct in all material respects on and as of such date, except for those
relating to an earlier date, which shall remain true and correct as of such
earlier date; and
(ii) No Default or Event of Default has occurred and is
continuing, or would result from the making of the Revolving Credit Loans.
(p) Receipt by the Administrative Agent of (i) the facility fees
payable to the Lenders, (ii) its administrative fee together with all other fees
payable pursuant to the Fee Letter.
(q) All schedules, documents, certificates and other information
provided to the Administrative Agent or any Lender pursuant to or in connection
with this Agreement shall be reasonably satisfactory to the Administrative Agent
and its counsel in all respects.
(r) All legal matters incident to this Agreement and the transactions
contemplated hereby shall be satisfactory to Cullen and ▇▇▇▇▇▇, counsel to the
Administrative Agent.
(s) Receipt by the Administrative Agent of such other approvals,
opinions or documents as the Administrative Agent or its counsel may reasonably
request.
(t) Payment by the Borrower of the reasonable fees and expenses of
counsel to the Administrative Agent.
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SECTION 3.02. CONDITIONS PRECEDENT TO ALL REVOLVING CREDIT LOANS. The
obligations of the Lenders to make each subsequent Revolving Credit Loan shall
be subject to the further condition precedent that on the date of such Revolving
Credit Loan:
(a) The following statements shall be true and each request for a
Revolving Credit Loan shall be deemed a certification by the Borrowers and the
Guarantors that such statements are true, and the Administrative Agent shall
have received, if requested by the Administrative Agent, a certificate signed by
the President or the Chief Financial Officer of the Borrower dated the date of
such Revolving Credit Loan, stating that:
(i) The representations and warranties contained in Article IV
of this Agreement and in the Loan Documents are true and correct in all material
respects on and as of such date as though made on and as of such date except for
those that relate to an earlier date which shall remain true and correct as of
such earlier date; and
(ii) No Default or Event of Default has occurred and is
continuing, or would result from such Revolving Credit Loan.
(b) The Administrative Agent shall have received such other approvals,
opinions or documents as the Administrative Agent may reasonably request.
SECTION 3.03. CONDITIONS PRECEDENT TO ALL LETTERS OF CREDIT AND ALL
B/AS. The obligation of the Issuing Bank to issue each Letter of Credit
(including the initial Letter of Credit) and to create each B/A shall be subject
to the further condition precedent that on the date of each request for a Letter
of Credit or B/A:
(a) The following statements shall be true and each request for a
Letter of Credit or B/A shall be deemed a certification by the Borrowers and the
Guarantors that such statements are true, and the Administrative Agent shall
have received, if requested by the Administrative Agent, a certificate signed by
the President or the Chief Financial Officer of the Borrower dated the date of
such request for a Letter of Credit or B/A, stating that:
(i) The representations and warranties contained in Article IV
of this Agreement and in the Loan Documents are true and correct in all material
respects on and as of such date as though made on and as of such date except for
those that relate to an earlier date which shall remain true and correct as of
such earlier date; and
(ii) No Default or Event of Default has occurred and is
continuing, or would result from the issuance of such Letter of Credit or the
creation of such B/A.
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(b) The Administrative Agent shall have received such other
approvals, opinions or documents as the Administrative Agent may reasonably
request.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES. On the date hereof and,
on each date that the Borrower requests a Revolving Credit Loan, a Letter of
Credit or the issuance of a B/A, the Borrower and the Guarantors each represent
and warrant as follows:
(a) SUBSIDIARIES. On the date hereof, the only Subsidiaries of the
Borrower or the Guarantors, whether or not active or inactive, are those set
forth on Schedule 4.01(a) annexed hereto, which Schedule accurately sets forth
with respect to each such Subsidiary, its name and address, any other addresses
at which it conducts business, its state of incorporation and each other
jurisdiction in which it is qualified to do business, other than jurisdictions
where the failure to so qualify would not be reasonably likely to result in a
Material Adverse Change in such Subsidiary, the identity and share holdings of
its stockholders and whether or not such Subsidiary is inactive and has no
material assets. Except as set forth on Schedule 4.01(a), all of the issued and
outstanding shares of each Subsidiary which are owned by the Borrower or any
Guarantor are owned by the Borrower or such Guarantor free and clear of any
mortgage, pledge, lien or encumbrance, other than Liens permitted by Section
5.02(a) of this Agreement. Except as set forth on Schedule 4.01(a) and except
for options granted under the 1984 Stock Option Plan or the 1994 Stock Plan,
there are no outstanding warrants, options, contracts or commitments of any kind
entitling any Person to purchase or otherwise acquire any shares of common or
capital stock or other equity interest of the Borrower, any Guarantor or any
Subsidiary of the Borrower or any Guarantor, nor are there outstanding any
securities which are convertible into or exchangeable for any shares of the
common or capital stock of the Borrower, any Guarantor or any Subsidiary of the
Borrower or any Guarantor.
(b) ORGANIZATION; GOOD STANDING. The Borrower, each Guarantor and
each Subsidiary of the Borrower or any Guarantor are each a corporation duly
incorporated, validly existing and in good standing under the laws of their
respective jurisdictions of incorporation and each has the corporate power to
own its assets and to transact the business in which it is presently engaged and
is duly qualified and is in good standing in all other jurisdictions where the
failure to so qualify would be reasonably likely to result in a Material Adverse
Change.
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(c) LOAN DOCUMENTS; NO CONSENTS OR VIOLATIONS. The execution,
delivery and performance by the Borrower and each Guarantor of the Loan
Documents to which they are a party are within the Borrower's and such
Guarantor's corporate power and have been duly authorized by all necessary
corporate action and do not and will not (i) require any consent or approval of
the stockholders of the Borrower or such Guarantor (other than those previously
obtained and appropriate evidence of which has been delivered to the
Administrative Agent); (ii) do not contravene the Borrower's or such Guarantor's
certificate of incorporation, charter or by-laws; (iii) violate any provision of
or any law, rule, regulation, contractual restriction, order, writ, judgment,
injunction, or decree, determination or award binding on or affecting the
Borrower or such Guarantor; (iv) result in a breach of or constitute a default
under any indenture or loan or credit agreement, or any other material
agreement, lease or instrument to which the Borrower or such Guarantor is a
party or by which it or its properties may be bound or affected; and (v) result
in, or require, the creation or imposition of any Lien upon or with respect to
any of the properties now owned or hereafter acquired by the Borrower or such
Guarantor, other than the Liens created pursuant to the Loan Documents.
(d) AUTHORIZATION. No authorization or approval or other action
by, and no notice to or filing with, any governmental authority or regulatory
body is required for the due execution, delivery and performance by the Borrower
or any Guarantor of any Loan Document to which it is a party, except
authorizations, approvals, actions, notices or filings which have been obtained,
taken or made, as the case may be.
(e) VALIDITY AND ENFORCEABILITY. The Loan Documents, when
delivered hereunder, will have been duly executed and delivered on behalf of the
Borrower and each Guarantor, as the case may be, and will be legal, valid and
binding obligations of the Borrower and each Guarantor, as the case may be,
enforceable against the Borrower or such Guarantor in accordance with their
respective terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors' rights generally.
(f) FINANCIAL STATEMENTS. The consolidated financial statements of
the Borrower and its Consolidated Subsidiaries for the fiscal year ended
December 31, 2000, and for the nine (9) month period ended September 30, 2001
copies of each of which have been furnished to the Administrative Agent and the
Lenders, (i) fairly present in all material respects the financial condition of
the Borrower and its Consolidated Subsidiaries as at such dates and the results
of operations of the Borrower and its Consolidated Subsidiaries for the periods
ended on such dates, all in accordance with GAAP, subject, in the case of the
interim financial statements, to year end adjustments and the absence of
footnotes, (ii) between December 31, 2000 and the date of this Agreement there
has been no Material Adverse Change and (iii) except as disclosed on such
financial statements or the notes thereto, there are no undisclosed liabilities
of the Borrower or any of its Consolidated Subsidiaries, contingent or otherwise
required to be disclosed therein.
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(g) LITIGATION. There is no pending or to the Borrower's or any
Guarantor's knowledge, threatened action, proceeding or investigation affecting
the Borrower, such Guarantor or any Subsidiary of the Borrower or any Guarantor,
before any court, governmental agency or arbitrator, which would either in one
case or in the aggregate, be reasonably likely to result in a Material Adverse
Change.
(h) TAXES. The Borrower, each Guarantor and each Subsidiary of the
Borrower or any Guarantor have filed all federal, state and local tax returns
required to be filed and have paid all taxes, assessments and governmental
charges and levies thereon to be due, including interest and penalties, unless
and only to the extent that (i) such taxes are being contested in good faith and
by appropriate proceedings by the Borrower, such Guarantor or any such
Subsidiary, as the case may be; (ii) there are adequate reserves therefor in
accordance with GAAP entered on the books of the Borrower, such Guarantor or any
such Subsidiary; and (iii) no enforcement proceedings for the collection of such
taxes against the Borrower, such Guarantor or any such Subsidiary have been
commenced.
(i) LICENSES, ETC. The Borrower, each Guarantor and each
Subsidiary of the Borrower or any Guarantor possess, or has the right to use,
all material licenses, permits, franchises, patents, copyrights, trademarks and
trade names, including, without limitation, those set forth on Schedule 4.01(v),
or rights thereto, to conduct their respective businesses substantially as now
conducted and as presently proposed to be conducted, and neither the Borrower,
such Guarantor nor any such Subsidiary are in violation of any similar rights of
others.
(j) NO ADVERSE AGREEMENTS. Neither the Borrower, nor any Guarantor
nor any Subsidiary of the Borrower or any Guarantor is a party to any indenture,
loan or credit agreement or any other agreement, lease or instrument or subject
to any charter or corporate restriction, the default or breach of which would be
reasonably likely to result in a Material Adverse Change. All material
agreements to which the Borrower, any Guarantor, or any Subsidiary of the
Borrower or any Guarantor is a party are in full force and effect and neither
the Borrower, such Guarantor nor any such Subsidiary are in default of any such
agreement.
(k) MARGIN STOCK. The Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation T, U or X), and no proceeds of any Loan will be used
to purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock or in any other way which
will cause the Borrower to violate the provisions of Regulations T, U or X.
(l) COMPLIANCE WITH LAWS. The Borrower, each Guarantor and each
Subsidiary of the Borrower or any Guarantor are, except as provided or disclosed
in paragraphs (h), (m) or (n) of this Section 4.01, in all material respects in
compliance with all federal and state laws and regulations in all jurisdictions
where the failure to comply with such laws or regulations would be reasonably
likely to result in a Material Adverse Change.
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(m) ERISA. Subject to the last sentence of this Section 4.01(m),
the Borrower, each Guarantor, each Subsidiary of the Borrower or any Guarantor
and each ERISA Affiliate are in compliance in all material respects with all
applicable provisions of ERISA. Neither a Reportable Event nor a Prohibited
Transaction has occurred and is continuing with respect to any Plan; no notice
of intent to terminate a Plan in a distress termination has been filed nor has
any Plan been terminated under such circumstances; no circumstances exist which
constitute grounds under Section 4042 of ERISA entitling the PBGC to institute
proceedings to terminate, or appoint a trustee to administrate, a Plan, nor has
the PBGC instituted any such proceedings; neither the Borrower, any Guarantor,
any Subsidiary of the Borrower or any Guarantor, nor any ERISA Affiliate has
completely or partially withdrawn under Sections 4201 or 4204 of ERISA from a
Multiemployer Plan which would result in a Material Adverse Change; the
Borrower, each Guarantor, each Subsidiary of the Borrower or any Guarantor and
each ERISA Affiliate have met their minimum funding requirements under ERISA
with respect to all of their Plans and the present fair market value of all Plan
assets exceeds the present value of all vested benefits under each Plan, as
determined on the most recent valuation date of the Plan in accordance with the
provisions of ERISA for calculating the potential liability of the Borrower,
such Guarantor, any such Subsidiary or any ERISA Affiliate to PBGC or the Plan
under Title IV of ERISA; and neither the Borrower, such Guarantor, any such
Subsidiary nor any ERISA Affiliate has incurred any liability to the PBGC under
ERISA. Notwithstanding the foregoing, the representations and warranties
contained in this Section 4.01(m) are qualified to the extent that if any such
representation or warranty applies to a Plan maintained by an ERISA Affiliate,
such representation or warranty shall be deemed to be to the best knowledge of
the Borrower.
(n) HAZARDOUS MATERIALS. The Borrower, each Guarantor and each
Subsidiary of the Borrower or any Guarantor are in compliance in all material
respects with all federal, state or local laws, ordinances, rules, regulations
or policies governing Hazardous Materials and neither the Borrower, any
Guarantor nor any such Subsidiary has used Hazardous Materials on, from, or
affecting any property now owned or occupied or hereafter owned or occupied by
the Borrower, such Guarantor or any such Subsidiary in any manner which violates
in a material manner federal, state or local laws, ordinances, rules,
regulations or policies governing the use, storage, treatment, transportation,
manufacture, refinement, handling, production or disposal of Hazardous
Materials, and, to the Borrower's, such Guarantor's and such Subsidiaries'
knowledge, no prior owner of any such property or any tenant, subtenant, prior
tenant or prior subtenant have used Hazardous Materials on, from or affecting
such property in any manner which violates in a material manner federal, state
or local laws, ordinances, rules, regulations, or policies governing the use,
storage, treatment, transportation, manufacture, refinement, handling,
production or disposal of Hazardous Materials.
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(o) USE OF PROCEEDS. The proceeds of the Revolving Credit Loans
shall be used exclusively for the purposes set forth in Sections 2.06 hereof.
(p) TITLE TO ASSETS; NO LIENS. The Borrower and each Guarantor
have good and marketable title to all of their properties and assets, subject
only to the Liens permitted by Section 5.02(a) of this Agreement.
(q) CASUALTIES, ETC. Neither the business nor the properties of
the Borrower, any Guarantor nor any Subsidiary of the Borrower or any Guarantor
are affected by any fire, explosion, accident, strike, hail, earthquake,
embargo, act of God or of the public enemy, or other casualty (whether or not
covered by insurance), which would be reasonably likely to result, in any one
case or in the aggregate, in a Material Adverse Change.
(r) SOLVENCY. After giving effect to the execution of this
Agreement, the availability of the Total Commitment and the Senior Note
Amendment, (i) the fair value of the assets of (x) the Borrower and its
Consolidated Subsidiaries, on a consolidated basis and (y) the Borrower and DPI,
each singularly, exceeds, in each case, their debts and liabilities
(subordinated, contingent or otherwise); (ii) the present fair saleable value of
the property of (x) the Borrower and its Consolidated Subsidiaries, on a
consolidated basis and (y) the Borrower and DPI, each singularly, is, in each
case, greater than the amount required to pay the probable liability of their
debts and other liabilities (subordinated, contingent or otherwise) as such
debts and other liabilities mature; (iii) (x) the Borrower and its Consolidated
Subsidiaries, on a consolidated basis and (y) the Borrower and each Guarantor
singularly, is, in each case, able to pay their debts and liabilities
(subordinated, contingent or otherwise) as such debts and liabilities mature;
and (iv) (x) the Borrower and its Consolidated Subsidiaries, on a consolidated
basis and (y) the Borrower and each Guarantor singularly, do not have, in each
case, unreasonably small capital to conduct the businesses in which they are
engaged; and (v) the Borrower and DPI each has a positive net worth.
(s) FINANCIAL ADVANTAGE. Each Guarantor acknowledges it has
derived or expects to derive a financial or other advantage from the Loans
obtained by the Borrower from the Lenders.
(t) CREDIT AGREEMENTS, ETC. Schedule 4.01(t) is a complete and
correct list, as of the date hereof, of all credit agreements, indentures,
purchase agreements, guaranties, Capital Leases, and other agreements and
arrangements presently in effect providing for or relating to extensions of
credit (including agreements and arrangements for the issuance of letters of
credit or for acceptance financing) in the principal amount of $100,000.00 or
more and in respect of which the Borrower or any Guarantor is in any manner
directly or contingently obligated (other than the Loan Documents), and the
maximum principal or face amounts of the credit in question, outstanding or to
be outstanding, are correctly stated, and all Liens of any nature given or
agreed to be given as security therefor are correctly described or indicated in
such Schedule.
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(u) CONSOLIDATED TANGIBLE NET WORTH. The Borrower's Consolidated
Tangible Net Worth at December 31, 2001 is not less than $48,000,000.00.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE V
COVENANTS OF THE BORROWER AND THE GUARANTOR
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any amount shall remain
outstanding under the Revolving Credit Notes, or there is any Outstanding L/C
Exposure, or so long as the Commitments shall remain in effect, the Borrower and
each Guarantor will, unless the Administrative Agent and the Required Lenders
shall otherwise consent in writing:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each Subsidiary
of the Borrower or any Guarantor to comply, in all material respects with all
applicable laws, rules, regulations and orders, where the failure to so comply
would be reasonably likely to result in a Material Adverse Change.
(b) REPORTING REQUIREMENTS. Furnish to the Administrative Agent
and the Lenders: (i) ANNUAL FINANCIAL STATEMENTS. As soon as available and in
any event within ninety (90) days after the end of each fiscal year of the
Borrower, a copy of the audited consolidated and unaudited consolidating (such
consolidating statements to be prepared by management of the Borrower) financial
statements of the Borrower and its Consolidated Subsidiaries for such year,
including balance sheets with related statements of income and retained earnings
and statements of cash flows, all in reasonable detail and setting forth in
comparative form the figures for the previous fiscal year, together with an
unqualified opinion, prepared by independent certified public accountants
selected by the Borrower and reasonably satisfactory to the Administrative
Agent, all such financial statements to be prepared in accordance with GAAP.
(ii) QUARTERLY FINANCIAL STATEMENTS. As soon as available and
in any event within forty five (45) days after the end of each of the first
three fiscal quarters of each fiscal year of the Borrower, a copy of the
consolidated and consolidating financial statements of the Borrower and its
Consolidated Subsidiaries for such quarter, including balance sheets with
related statements of income and retained earnings and statements of cash flows,
all in reasonable detail and setting forth in comparative form the figures for
the comparable period for the previous fiscal year, all such financial
statements to be prepared by management of the Borrower in accordance with GAAP.
(iii) MANAGEMENT LETTERS. Promptly upon receipt thereof, copies
of any reports submitted to the Borrower or any Guarantor by independent
certified public accountants in connection with the examination of the financial
statements of the Borrower and the Guarantor made by such accountants.
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(iv) CERTIFICATE OF NO DEFAULT. Simultaneously with the
delivery of the financial statements referred to in Section 5.01(b)(i) and (ii),
a certificate of the President or the Chief Financial Officer of the Borrower,
(1) certifying that no Default or Event of Default has occurred and is
continuing, or if a Default or Event of Default has occurred and is continuing,
a statement as to the nature thereof and the action which is proposed to be
taken with respect thereto; and (2) with computations demonstrating compliance
with the covenants contained in Section 5.03.
(v) ACCOUNTANTS' REPORT. Simultaneously with the delivery of
the annual financial statements referred to in Section 5.01(b)(i), a certificate
of the independent certified public accountants who audited such statements to
the effect that, in making the examination necessary for the audit of such
statements, they have obtained no knowledge of any condition or event which
constitutes a Default or Event of Default, or if such accountants shall have
obtained knowledge of any such condition or event, specify in such certificate
each such condition or event of which they have knowledge and the nature and
status thereof.
(vi) NOTICE OF LITIGATION. Promptly after the commencement
thereof, notice of all actions, suits and proceedings before any court or
governmental department, commission, board, bureau, agency, or instrumentality,
domestic or foreign, affecting the Borrower, any Guarantor or any Subsidiary of
the Borrower or any Guarantor which, if determined adversely to the Borrower,
such Guarantor or any such Subsidiary would be reasonably likely to result in a
Material Adverse Change.
(vii) NOTICE OF DEFAULTS AND EVENTS OF DEFAULT. As soon as
possible and in any event within five (5) days after the occurrence of each
Default or Event of Default, a written notice setting forth the details of such
Default or Event of Default and the action which is proposed to be taken by the
Borrower with respect thereto.
(viii) ERISA REPORTS. Promptly after the filing or receiving
thereof, copies of all reports, including annual reports, and notices which the
Borrower, any Guarantor or any Subsidiary of the Borrower or any Guarantor,
files with or receives from the PBGC, the Internal Revenue Service or the U.S.
Department of Labor under ERISA; and as soon as possible after the Borrower, any
Guarantor or any such Subsidiary knows or has reason to know that any Reportable
Event or Prohibited Transaction has occurred with respect to any Plan or that
the PBGC or the Borrower, any Guarantor or any such Subsidiary has instituted or
will institute proceedings under Title IV of ERISA to terminate any Plan, the
Borrower or such Guarantor will deliver to the Administrative Agent and the
Lenders a certificate of the President or the Chief Financial Officer of the
Borrower or such Guarantor setting forth details as to such Reportable Event or
Prohibited Transaction or Plan termination and the action the Borrower or such
Guarantor proposes to take with respect thereto;
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(ix) ENVIRONMENTAL NOTICES. Promptly after the receipt
thereof, a copy of any written claim, summons, charge or other notice to the
Borrower, any Guarantor or any Subsidiary of the Borrower or any Guarantor
alleging failure to comply with any federal, state or local laws governing
Hazardous Materials.
(x) MATERIAL ADVERSE CHANGE. Promptly, upon the occurrence
thereof, notice of a Material Adverse Change.
(xi) REPORTS TO OTHER CREDITORS. Promptly after the furnishing
thereof, copies of any statement or report furnished to any other party pursuant
to the terms of any indenture, loan, or credit or similar agreement and not
otherwise required to be furnished to the Administrative Agent and the Lenders
pursuant to any other clause of this Section 5.01(b).
(xii) PROXY STATEMENTS, ETC. Promptly after the sending or
filing thereof, copies of all proxy statements, financial statements and reports
which the Borrower, any Guarantor or any Subsidiary of the Borrower or any
Guarantor sends to its stockholders, and copies of all regular, periodic, and
special reports, and all registration statements which the Borrower or such
Guarantor or any such Subsidiary files with the Securities and Exchange
Commission or any governmental authority which may be substituted therefor, or
with any national securities exchange.
(xiii) NOTICE OF AFFILIATES. Promptly after any Person becomes
an Affiliate of the Borrower or any Guarantor (other than if such Person becomes
an Affiliate solely by virtue of a member of management of the Borrower making
an investment in such Person), notice to the Administrative Agent and the
Lenders of such Affiliate, provided that this clause (xiii) shall not require
the Borrower or any Guarantor to advise the Administrative Agent and the Lenders
of any changes in officers other than executive officers.
(xiv) NORTH CAROLINA EXPANSION. Promptly after any information
previously delivered to the Administrative Agent in connection with the North
Carolina Expansion changes, in a material manner as determined in good faith by
the Borrower, information regarding such changes in reasonable detail.
(xv) GENERAL INFORMATION. Such other information respecting
the condition or operations, financial or otherwise, of the Borrower, any
Guarantor or any Subsidiary of the Borrower or any Guarantor as the
Administrative Agent or any Lender may from time to time reasonably request.
(c) TAXES. Pay and discharge, and cause each Subsidiary of the Borrower
or any Guarantor to pay and discharge, all taxes, assessments and governmental
charges upon it or them, its or their income and its or their properties prior
to the dates on which penalties are attached thereto, unless and only to the
extent that (i) such taxes shall be contested in good faith and by appropriate
proceedings by the Borrower, such Guarantor or any such Subsidiary, as the case
may be; (ii) there be adequate reserves therefor in accordance with GAAP entered
on the books of the Borrower, such Guarantor or any such Subsidiary; and (iii)
no enforcement proceedings for the collection of such taxes against the
Borrower, such Guarantor or any such Subsidiary have been commenced.
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(d) CORPORATE EXISTENCE. Except as permitted by Section 5.02(c) of
this Agreement, preserve and maintain, and cause each Subsidiary of the Borrower
or any Guarantor to preserve and maintain, their corporate existence and good
standing in the jurisdiction of their incorporation and the rights, privileges
and franchises of the Borrower, each Guarantor and each such Subsidiary in each
case where failure to so preserve or maintain would be reasonably likely to
result in a Material Adverse Change, except that any inactive Subsidiary (that
has no assets) may wind up, liquidate or dissolve with at least thirty (30) days
prior written notice to the Administrative Agent.
(e) MAINTENANCE OF PROPERTIES AND INSURANCE. (i) Keep, and cause
each Subsidiary of the Borrower and any Guarantor to keep, the respective
properties and assets (tangible or intangible) that are useful and necessary in
its business, in good working order and condition, reasonable wear and tear
excepted; and (ii) maintain, and cause any such Subsidiary to maintain,
insurance with financially sound and reputable insurance companies or
associations in such amounts and covering such risks as are usually carried by
companies engaged in similar businesses and owning properties and doing business
in the same general areas in which the Borrower, any Guarantor and any such
Subsidiary may operate.
(f) BOOKS OF RECORD AND ACCOUNT. Keep, and cause each Subsidiary
of the Borrower and any Guarantor to keep, adequate records and proper books of
record and account in which complete entries will be made in a manner to enable
the preparation of financial statements in accordance with GAAP, reflecting all
financial transactions of the Borrower, such Guarantor, and any such Subsidiary.
(g) VISITATION. At any reasonable time, and from time to time, and
upon prior notice, and, provided no Default or Event of Default then exists, not
more often than once during any calendar year, permit the Administrative Agent
or any agents or representatives thereof, to examine and make copies of (except
if such copies would result in the loss of any attorney-client or other
privilege) and abstracts from the financial and accounting books and records of,
and visit the properties of, the Borrower, the Guarantor or any Subsidiary of
the Borrower or the Guarantor to discuss the affairs, finances and accounts of
the Borrower, the Guarantor or any such Subsidiary with any of the respective
officers of the Borrower, the Guarantor or any such Subsidiary or the
Borrower's, the Guarantor's or such Subsidiary's independent accountants.
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(h) PERFORMANCE AND COMPLIANCE WITH OTHER AGREEMENTS. Perform and
comply in all material respects, and cause each Subsidiary of the Borrower or
any Guarantor to perform and comply in all material respects, with each of the
provisions of each and every agreement the failure to perform or comply with
which would be reasonably likely to result in a Material Adverse Change.
(i) PENSION FUNDING. Comply in all material respects, and cause
each Subsidiary of the Borrower or any Guarantor to comply in all material
respects, with the following and cause each ERISA Affiliate of the Borrower, any
Guarantor or any such Subsidiary to comply with the following:
(i) engage solely in transactions which would not subject any
of such entities to either a civil penalty assessed pursuant to Section 502(i)
of ERISA or a tax imposed by Section 4975 of the Internal Revenue Code in either
case in an amount in excess of $25,000.00;
(ii) make full payment when due of all amounts which, under
the provisions of any Plan or ERISA, the Borrower, any Guarantor, any such
Subsidiary or any ERISA Affiliate of any of same is required to pay as
contributions thereto;
(iii) all applicable provisions of the Internal Revenue Code
and the regulations promulgated thereunder, including but not limited to Section
412 thereof, and all applicable rules, regulations and interpretations of the
Accounting Principles Board and the Financial Accounting Standards Board;
(iv) not fail to make any payments in an aggregate amount
greater than $25,000.00 to any Multiemployer Plan that the Borrower, any
Guarantor, any such Subsidiary or any ERISA Affiliate may be required to make
under any agreement relating to such Multiemployer Plan, or any law pertaining
thereto; or
(v) not take any action regarding any Plan which could result
in the occurrence of a Prohibited Transaction.
(j) LICENSES; TRADEMARKS. Maintain at all times, and cause each
Subsidiary of the Borrower or any Guarantor to maintain at all times, all
licenses or permits necessary to the conduct of its business or as may be
required by any governmental agency or instrumentality thereof, except for such
licenses or permits where the failure to so maintain would not be reasonably
likely to result in a Material Adverse Change and take all steps necessary to
maintain the exclusive ownership of, and the rights to, all trademarks and
tradenames material to the business of the Borrower or a Subsidiary, provided
however that the Borrower and the Guarantors shall not be required to take such
steps, including, without limitation the renewal or continuation of such a
material trademark or tradename registrations in the United States Trademark
Office, if the Borrower or the applicable Guarantor has provided the
Administrative Agent and the Lenders with a written statement giving the reasons
why such steps are not necessary and why such failure to maintain such trademark
or tradename would not result in a Material Adverse Change.
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(k) NEW SUBSIDIARIES. (i) Cause any Subsidiary (other than a
Foreign Subsidiary) of the Borrower or any Guarantor formed after the date of
this Agreement to become a Guarantor and to become a party to this Agreement as
a Guarantor.
(ii) Cause any Foreign Subsidiary which, in the reasonable
determination of the Borrower and its professional advisors, if it became a
Guaranteeing Foreign Subsidiary would not result in adverse tax consequences to
the Borrower, to become a Guarantor and to become a party to this Agreement as a
Guarantor.
SECTION 5.02. NEGATIVE COVENANTS. So long as any amount shall remain
outstanding under the Revolving Credit Note, or there is any Outstanding L/C
Exposure, or so long as the Commitment shall remain in effect, neither the
Borrower nor any Guarantor will, without the written consent of the
Administrative Agent and the Required Lenders:
(a) LIENS, ETC. Create, incur, assume or suffer to exist, any
Lien, upon or with respect to any of its properties, now owned or hereafter
acquired, except:
(i) Liens for taxes or assessments or other government charges
or levies if not yet due and payable or if due and payable if they are being
contested in good faith by appropriate proceedings and for which appropriate
reserves are maintained;
(ii) Liens imposed by law, such as mechanics', materialmen's,
landlords', warehousemen's, and carriers' Liens, and other similar Liens,
securing obligations incurred in the ordinary course of business which are not
past due or which are being contested in good faith by appropriate proceedings
and for which appropriate reserves have been established;
(iii) Liens under workers' compensation, unemployment
insurance, Social Security, or similar legislation;
(iv) Liens, deposits, or pledges to secure the performance of
bids, tenders, contracts (other than contracts for the payment of money), leases
(permitted under the terms of this Agreement), public or statutory obligations,
surety, stay, appeal, indemnity, performance or other similar bonds, or other
similar obligations arising in the ordinary course of business;
(v) Liens described in Schedule 5.02(a), which Liens may be
renewed, extended or refinanced, without securing any additional Debt and on
terms no less favorable to the Borrower or applicable Guarantor than the
original terms;
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(vi) Judgment and other similar Liens arising in connection
with court proceedings (other than those described in Section 6.01(f)), provided
the execution or other enforcement of such Liens is effectively stayed and the
claims secured thereby are being actively contested in good faith and by
appropriate proceedings;
(vii) Easements, rights-of-way, restrictions, and other
similar encumbrances which, in the aggregate, do not materially interfere with
the Borrower's or a Guarantor's occupation, use and enjoyment of the property or
assets encumbered thereby in the normal course of its business or materially
impair the value of the property subject thereto;
(viii) The North Carolina Mortgage; and
(ix) Purchase money Liens on any property hereafter acquired
or the assumption of any Lien on property existing at the time of such
acquisition, or a Lien incurred in connection with any conditional sale or other
title retention agreement or a Capital Lease, provided that:
(1) Any property subject to any of the foregoing is
acquired by the Borrower or a Guarantor in the ordinary course of its respective
business and the Lien on any such property is created contemporaneously with
such acquisition;
(2) The obligation secured by any Lien so created,
assumed, or existing shall not exceed one hundred (100%) percent of lesser of
cost or fair market value of the property acquired as of the time of the
Borrower or the Guarantor acquiring the same;
(3) Each such Lien shall attach only to the property
so acquired and fixed improvements thereon; and
(4) The obligation secured by such Lien is permitted
by the provisions of Section 5.02(b) and the related expenditure is permitted by
the provisions of Section 5.03(b).
(b) DEBT. Create, incur, assume, or suffer to exist, any Debt,
except:
(i) Debt of the Borrower under this Agreement or the Notes;
(ii) Debt described in Schedule 5.02(b),which Debt may be
renewed, extended or refinanced on terms no less favorable to the Borrower or
applicable Guarantor than the current terms of such Debt;
(iii) Subordinated Debt;
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(iv) Accounts payable to trade creditors for goods or services
and current operating liabilities (other than for borrowed money), in each case
incurred and paid in the ordinary course of business;
(v) Debt of the Borrower or any Guarantor secured by purchase
money Liens permitted by Section 5.02(a)(ix);
(vi) Debt evidenced by the Senior Notes;
(vii) Debt secured by the North Carolina Mortgage; and
(viii) Intercompany Debt.
Notwithstanding anything in this Section 5.02(b) to the contrary, the
Borrower shall be permitted to refinance the Senior Notes with the proceeds of a
new long term financing arrangement (the "Replacement Senior Notes"), provided
that (i) the terms and conditions of the Replacement Senior Notes shall be
subject to the satisfactory review and approval of the Required Lenders, which
approval shall not be unreasonably withheld, delayed or conditioned, (ii) at the
time of such refinancing no Event of Default shall have occurred and be
continuing or shall result from such refinancing and the Borrower shall have
provided the Administrative Agent and the Lenders with reasonable evidence that
after giving effect to the Replacement Senior Notes it will remain in compliance
with the terms and conditions of this Agreement, including, without limitation,
Section 5.03 and (iii) after giving effect to the Replacement Senior Notes, the
maximum Consolidated Funded Debt of the Borrower, which for purposes hereof,
shall be deemed to consist solely of the Replacement Senior Notes, the North
Carolina Mortgage (which may be refinanced with and into the Replacement Senior
Notes) and the Total Commitment, shall not exceed $95,000,000.00.
(c) MERGER. Merge into, or consolidate with or into, or have
merged into it, any Person; and, for the purpose of this subsection (c), the
acquisition or sale by the Borrower or any Guarantor by lease, purchase or
otherwise, of all, or substantially all, of the common stock or the assets of
any Person or of it shall be deemed a merger of such Person with the Borrower or
any Guarantor, provided that (i) the Borrower may merge with any Guarantor,
provided the Borrower is the surviving entity and (iii) any Guarantor may merge
with any other Guarantor.
(d) SALE OF ASSETS, ETC. Sell, assign, transfer, lease or
otherwise dispose of any of its assets, (including a saleleaseback transaction)
with or without recourse, except for (i) inventory disposed of in the ordinary
course of business; (ii) the sale or other disposition of assets no longer used
or useful in the conduct of its business; (iii) Permitted Equipment Sales, (iv)
a Permitted Real Estate Sale and (v) sales of assets between the Borrower and a
Guarantor or between Guarantors, or sale of assets by an inactive Subsidiary of
the Borrower or a Guarantor to the Borrower or a Guarantor.
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(e) INVESTMENTS, ETC. Make any Investment other than Permitted
Investments.
(f) TRANSACTIONS WITH AFFILIATES. Except as otherwise expressly
permitted by this Agreement or except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's, a Guarantor's or a
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Borrower or a Guarantor or a Subsidiary than would be obtained in a
comparable arm's length transaction with a Person not an Affiliate, enter into
any transaction, including, without limitation, the purchase, sale, or exchange
of property or the rendering of any service, with any Affiliate, provided
however, in no event shall the Borrower or any Guarantor engage in any
transaction with a Subsidiary of the Borrower or a Guarantor which Subsidiary is
not a Guarantor.
(g) PREPAYMENT OF OUTSTANDING DEBT. Pay, in whole or in part, any
outstanding Debt of the Borrower or a Guarantor, which by its terms is not then
due and payable other than (i) Debt owing to the Lenders, (ii) Intercompany Debt
and (iii) accounts payable and other trade payables. Notwithstanding anything to
the contrary contained in this Section 5,.02(g), the Borrower shall be permitted
to refinance the Senior Notes with the proceeds of Replacement Senior Notes,
subject to the terms and conditions contained in Section 5.02(b).
(h) GUARANTEES. Guaranty, or in any other way become directly or
contingently obligated for any Debt of any other Person (including any
agreements relating to working capital maintenance, take or pay contracts or
similar arrangements) other than (i) the endorsement of negotiable instruments
for deposit in the ordinary course of business; (ii) guarantees existing on the
date hereof and set forth in Schedule 5.02(h) annexed hereto; or (iii)
guarantees of any Debt permitted under Section 5.02(b) of this Agreement.
(i) CHANGE OF BUSINESS. Materially alter the nature of its business.
(j) FISCAL YEAR. Change the ending date of its fiscal year from
December 31.
(k) MAXIMUM LOSSES. Incur a consolidated net loss (calculated
exclusive of extraordinary gains but inclusive of extraordinary losses as
calculated in accordance with GAAP) for any fiscal quarter or any fiscal year.
(l) ACCOUNTING POLICIES. Change any accounting policies, except as
permitted by GAAP.
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(m) DIVIDENDS, ETC. Declare or pay any dividends, purchase,
redeem, retire or otherwise acquire for value any of its capital stock now or
hereafter outstanding, or make any distribution of assets to its stockholders as
such, whether in cash, assets, or in obligations of the Borrower or a Guarantor;
or allocate or otherwise set apart any sum for the payment of any dividend or
distribution on, or for the purchase, redemption or retirement of any shares of
its capital stock; or make any other distribution by reduction of capital or
otherwise in respect of any share of its capital stock, except (i) any
Subsidiary may pay dividends to its shareholder(s), (ii) the Borrower may pay
Permitted Dividends, and (iii) the Borrower may make Permitted Stock
Repurchases.
(n) CHANGE IN CONTROL. (a) Permit any Person or "group" (within
the meaning of Section 13(d)-3 under the Securities Exchange Act of 1934 and the
rules of the Securities and Exchange Commission as in effect on the date
hereof), other than the members of management of the Borrower and the directors
of the Borrower, each as in office on the date of this Agreement, to own more
than fifty (50%) percent of the outstanding voting securities of the Borrower.
(b) Permit any nominees other than nominees nominated by the existing board of
directors of the Borrower to hold a majority of the seats on the board of
directors of the Borrower.
(o) HAZARDOUS MATERIAL. The Borrower, each Guarantor and each
Subsidiary of the Borrower or a Guarantor shall not cause or permit any property
owned or occupied by the Borrower, a Guarantor or any such Subsidiary to be used
to generate, manufacture, refine, transport, treat, store, handle, dispose,
transfer, produce or process Hazardous Materials, except in compliance with all
applicable federal, state and local laws or regulations; nor shall the Borrower,
a Guarantor or any such Subsidiary cause or permit, as a result of any
intentional or unintentional act or omission on the part of the Borrower, such
Guarantor or any such Subsidiary or any tenant or subtenant, a release of
Hazardous Materials onto any property owned or occupied by the Borrower, such
Guarantor or any such Subsidiary or onto any other property other than in
compliance with all applicable federal, state and local laws or regulations; nor
shall the Borrower, the Guarantors and each such Subsidiary fail to comply in
all material respects with all applicable federal, state and local laws,
ordinances, rules and regulations, whenever and by whomever triggered, nor fail
to obtain and comply in all material respects with, any and all approvals,
registrations or permits required thereunder. The Borrower and the Guarantors
shall execute any documentation reasonably required by the Administrative Agent
in connection with the representations, warranties and covenants contained in
this paragraph and Section 4.01 of this Agreement.
(p) LIMITATIONS ON CONSOLIDATED FOREIGN ASSETS AND REVENUES. (i)
Have more than fifteen (15%) percent of the consolidated assets or revenues of
the Borrower and its Consolidated Subsidiaries be located in, or derived from,
locations other than the United States.
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(ii) Have more than ten (10%) percent of the consolidated
assets or revenues of the Borrower and its Consolidated Subsidiaries be held by,
or produced by, any Foreign Subsidiary.
SECTION 5.03. FINANCIAL REQUIREMENTS. So long as any amount shall
remain outstanding under the Revolving Credit Note, or there is any Outstanding
L/C Exposure, or so long as the Commitment shall remain in effect:
(a) MINIMUM CONSOLIDATED TANGIBLE NET WORTH. The Borrower will
maintain Consolidated Tangible Net Worth ("CTNW") of not less than the amounts
set forth below for the periods set forth below (to be tested quarterly):
PERIOD MINIMUM CTNW
------ ------------
Closing Date to 12/30/02 $48,000,000.00
12/31/02 to 12/30/03 The actual CTNW as of the
and for each succeeding preceding December 31
period beginning on each PLUS 50% of the Borrower's
December 31 and ending on Consolidated Net Income for
the next December 30 the fiscal year ending on such
December 31.
(b) CONSOLIDATED CAPITAL EXPENDITURES. The Borrower will not make
Consolidated Capital Expenditures in excess of: (i) $9,000,000.00 (excluding
Consolidated Capital Expenditures permitted by clause (ii) below) in the
aggregate during any fiscal year of the Borrower; and (ii) $17,400,000.00 in the
aggregate during the term of this Agreement in connection with the North
Carolina Expansion.
(c) CONSOLIDATED FIXED CHARGE RATIO. The Borrower will maintain at
all times a Consolidated Fixed Charge Ratio of not less than the ratios set
forth below for the periods set forth below (to be tested quarterly):
PERIOD RATIO
------ -----
Closing Date to 3/30/02 1.50 to 1.00
3/31/02 to 12/30/03 1.15 to 1.00
12/31/03 and thereafter 1.25 to 1.00
(d) FUNDED DEBT TO EBITDA RATIO. The Borrower will maintain at all
times a Funded Debt to EBITDA Ratio of not greater than 2.75 to 1.00(to be
tested quarterly):
(e) CONSOLIDATED INTEREST COVERAGE RATIO. The Borrower will maintain at
all times a Consolidated Interest Coverage Ratio of not less than 3.50 to 1.00
(to be tested quarterly):
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay (i) any installment of
principal of any Revolving Credit Note when due, (ii) any amounts due in
connection with any Letter of Credit or B/A when due or (iii) any interest, fees
or other amounts owed in connection with this Agreement within five (5) days of
when such payment is due; or
(b) Any representation or warranty made by the Borrower or a
Guarantor herein or in the Loan Documents or which is contained in any
certificate, document, opinion, or financial or other statement furnished at any
time under or in connection with any Loan Document shall prove to have been
incorrect in any material respect when made; or
(c) The Borrower or a Guarantor shall (i) fail to perform or
observe any term, covenant or agreement contained in Sections 5.01(a), (c), (e),
(f), (h), (i), or (j) of this Agreement for twenty (20) days after such
performance or observation is required, or (ii) fail to perform or observe any
other term, covenant, or agreement contained in this Agreement in any other Loan
Document (other than the Notes) on its part to be performed or observed; or
(d) The Borrower, a Guarantor, or any Subsidiary of the
Borrower or a Guarantor shall fail to pay any Debt or Debts, or principal
installments thereon, which Debt or Debts are in the aggregate principal amount
of $500,000.00 or more (excluding Debt evidenced by the Notes) of the Borrower,
a Guarantor or any such Subsidiary (as the case may be), or any interest or
premium thereon, when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Debt; or any other default under any agreement or instrument
relating to any such Debt, or any other event shall occur and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such default or event is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid (other than by a
regularly scheduled required prepayment), prior to the stated maturity thereof;
or
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(e) The Borrower, any Guarantor or any Subsidiary of the
Borrower or any Guarantor shall generally not pay its Debts as such Debts become
due, or shall admit in writing its inability to pay its Debts generally, or
shall make a general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against the Borrower, any Guarantor or any such
Subsidiary seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its Debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, or other similar
official for it or for any substantial part of its property and if instituted
against the Borrower, any Guarantor or any such Subsidiary shall remain
undismissed for a period of 60 days; or the Borrower, any Guarantor or any such
Subsidiary shall take any action to authorize any of the actions set forth above
in this subsection (e); or
(f) Any judgment or order or combination of judgments or
orders for the payment of money, in excess of $500,000.00 in the aggregate,
which sum shall not be subject to full, complete and effective insurance
coverage (subject to deductibles), shall be rendered against the Borrower, any
Guarantor or any Subsidiary of the Borrower or any Guarantor and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of 30 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
(g) Any Guarantor shall fail to perform or observe any term or
provision of its Guaranty or any representation or warranty made by such
Guarantor (or any of its officers) in connection with such Guarantor's Guaranty
shall prove to have been incorrect in any material respect when made; or
(h) Any of the following events occur or exist with respect to
the Borrower, any Guarantor, any Subsidiary of the Borrower or any Guarantor, or
any ERISA Affiliate: (i) any Prohibited Transaction involving any Plan; (ii) any
Reportable Event with respect to any Plan; (iii) the filing under Section 4041
of ERISA of a notice of intent to terminate any Plan or the termination of any
Plan; (iv) any event or circumstance that might constitute grounds entitling the
PBGC to institute proceedings under Section 4042 of ERISA for the termination
of, or for the appointment of a trustee to administer, any Plan, or the
institution of the PBGC of any such proceedings; (v) complete or partial
withdrawal under Section 4201 or 4204 of ERISA from a Multiemployer Plan or the
reorganization insolvency, or termination of any Multiemployer Plan; and in each
case above, such event or condition, together with all other events or
conditions, if any, could in the opinion of the Administrative Agent subject the
Borrower, any Guarantor, any such Subsidiary or any ERISA Affiliate to any tax,
penalty, or other liability to a Plan, a Multiemployer Plan, the PBGC, or
otherwise (or any combination thereof) which in the aggregate exceeds or may
exceed $250,000.00; or
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(i) This Agreement or any other Loan Document, at any time
after its execution and delivery and for any reason, ceases to be in full force
and effect or shall be declared to be null and void, or the validity or
enforceability of any document or instrument delivered pursuant to this
Agreement shall be contested by the Borrower, any Guarantor or any party to such
document or instrument or the Borrower, any Guarantor or any party to such
document or instrument shall deny that it has any or further liability or
obligation under any such document or instrument; or
(j) An event of default specified in any Loan Document other
than this Agreement shall have occurred and be continuing.
SECTION 6.02. REMEDIES ON DEFAULT. Upon the occurrence and continuance
of an Event of Default the Administrative Agent may, and at the request of the
Required Lenders shall, by notice to the Borrower, take any or all of the
following actions, (i) terminate the Commitments, (ii) demand cash collateral in
the full amount of the Outstanding L/C Exposure, (iii) declare the Notes, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Commitments shall be terminated, the
cash collateral shall be due, the Revolving Credit Notes, all such interest and
all such amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower and (iv) proceed to enforce its rights
whether by suit in equity or by action at law, whether for specific performance
of any covenant or agreement contained in this Agreement or any Loan Document,
or in aid of the exercise of any power granted in either this Agreement or any
Loan Document or proceed to obtain judgment or any other relief whatsoever
appropriate to the enforcement of its rights, or proceed to enforce any other
legal or equitable right which the Administrative Agent may have by reason of
the occurrence of any Event of Default hereunder or under any Loan Document,
provided, however, upon the occurrence of an Event of Default referred to in
Section 6.01(e), the Commitments shall be immediately terminated, the cash
collateral shall be immediately due, the Revolving Credit Notes, all interest
thereon and all other amounts payable under this Agreement shall be immediately
due and payable without presentment, demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Borrower. Any amounts
collected pursuant to action taken under this Section 6.02 shall be applied to
the payment of, first, any costs incurred by the Administrative Agent in taking
such action, including, but without limitation, reasonable attorneys fees and
expenses, second, to cash collateral for the Outstanding L/C Exposure, third, to
payment of the accrued but unpaid interest on the Revolving Credit Notes, and
fourth, to payment of the unpaid principal of the Revolving Credit Notes.
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SECTION 6.03. REMEDIES CUMULATIVE. No remedy conferred upon or reserved
to the Administrative Agent or the Lenders hereunder or in any Loan Document is
intended to be exclusive of any other available remedy, but each and every such
remedy shall be cumulative and in addition to every other remedy given under
this Agreement or any Loan Document or now or hereafter existing at law or in
equity. No delay or omission to exercise any right or power accruing upon any
Event of Default shall impair any such right or power or shall be construed to
be a waiver thereof, but any such right and power may be exercised from time to
time and as often as may be deemed expedient. In order to entitle the
Administrative Agent or any Lender to exercise any remedy reserved to it in this
Article VI, it shall not be necessary to give any notice, other than such notice
as may be herein expressly required in this Agreement or in any Loan Document.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE VII
THE AGENTS; RELATIONS AMONG LENDERS AND BORROWER
SECTION 7.01. APPOINTMENT, POWERS AND IMMUNITIES OF AGENTS. Each Lender
hereby irrevocably appoints and authorizes (i) the Administrative Agent to act
as the Administrative Agent hereunder and under any other Loan Document with
such powers as are specifically delegated to the Administrative Agent by the
terms of this Agreement and any other Loan Document, together with such other
powers as are reasonably incidental thereto and (ii) the Documentation Agent to
act as the Documentation Agent hereunder and under any other Loan Document with
such powers as are specifically delegated to the Documentation Agent by the
terms of this Agreement and any other Loan Document, together with such other
powers as are reasonably incidental thereto. The Administrative Agent and the
Documentation Agent shall have no duties or responsibilities except those
expressly set forth in this Agreement and any other Loan Document, and shall not
by reason of this Agreement be a trustee or fiduciary for any Lender. Neither
Agent shall be responsible to the Lenders for any recitals, statements,
representations or warranties made by the Borrower or the Guarantors, or any
officer or official of the Borrower or Guarantors, or any of them, or any other
Person contained in this Agreement or any other Loan Document, or in any
certificate or other document or instrument referred to or provided for in, or
received by any of them under, this Agreement or any other Loan Document, or for
the value, legality, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document or any other document
or instrument referred to or provided for herein or therein, except as
explicitly provided herein, or for the failure by the Borrower, the Guarantors,
or any of them to perform any of their or its respective obligations hereunder
or thereunder. The Administrative Agent may employ agents and attorneys-in-fact
and shall not be responsible, except as to money or securities received by it or
its authorized agents, for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Except as otherwise
explicitly provided herein, neither Agent nor any of their directors, officers,
employees or agents shall be liable or responsible to any Lender for any action
taken or omitted to be taken by it or them hereunder or under any other Loan
Document or in connection herewith or therewith, except for its or their own
gross negligence or willful misconduct. The Borrower shall pay any fee agreed to
by the Borrower and the Administrative Agent with respect to the Administrative
Agent's services hereunder.
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SECTION 7.02. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative
Agent shall be entitled to rely upon any certification, notice or other
communication (including any thereof by telephone, telex, telegram or cable)
believed by it to be genuine and correct and to have been signed or sent by or
on behalf of the proper Person or Persons, and upon advice and statements of
legal counsel, independent accountants and other experts selected by the
Administrative Agent with reasonable care. The Administrative Agent may deem and
treat each Lender as the holder of the Loans made by it for all purposes hereof
unless and until a notice of the permitted transfer thereof satisfactory to the
Administrative Agent and signed by such Lender shall have been furnished to the
Administrative Agent but the Administrative Agent shall not be required to deal
with any Person who has acquired a participation in any Loan from a Lender. As
to any matters not expressly provided for by this Agreement or any other Loan
Document, the Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with instructions
signed by the Required Lenders, and such instructions of the Required Lenders
and any action taken or failure to act pursuant thereto shall be binding on all
of the Lenders and any other holder of all or any portion of any Loan.
SECTION 7.03. DEFAULTS. Neither Agent shall be deemed to have knowledge
of the occurrence of a Default or Event of Default (other than the non-payment
of principal of or interest on the Loans or the non-payment of fees due
hereunder) unless the such Agent has actual knowledge of such Default or Event
of Default or has received notice from a Lender or a Borrower specifying such
Default or Event of Default and stating that such notice is a "Notice of
Default." In the event that either Agent receives such a notice of, or otherwise
has actual knowledge of the occurrence of, a Default or Event of Default, such
Agent shall give prompt notice thereof to the other Agent and the Lenders (and
shall give each Lender prompt notice of each such non-payment). The
Administrative Agent shall (subject to Section 7.08 and Section 8.01 hereof)
take such action with respect to such Default or Event of Default which is
continuing as shall be directed by the Required Lenders; provided that, unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem advisable in
the best interest of the Lenders; and provided further that the Administrative
Agent shall not be required to take any such action which it determines to be
contrary to law.
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SECTION 7.04. RIGHTS OF AGENTS AS LENDERS. With respect to the Loans
made by it, any Person which is an Agent in its capacity as a Lender hereunder
shall have the same rights and powers hereunder as any other Lender and may
exercise the same as though it were not acting as an Agent, and the term
"Lender" or "Lenders" shall, unless the context otherwise indicates, include any
Person which is an Agent in its capacity as a Lender. Each Agent or any Lender
and their respective Affiliates may (without having to account therefor to any
other Lender except as otherwise expressly provided in this Agreement) accept
deposits from, lend money to (on a secured or unsecured basis but subject to the
provisions of Section 5.02(a) and (b) of this Agreement), and generally engage
in any kind of banking, trust or other business with, the Borrower, the
Guarantors or any of them (and any of their Affiliates); PROVIDED that no
payment or lien priority (other than loans secured by the North Carolina
Mortgage and other than purchase money liens on equipment being financed by such
Lender) shall be given to an Agent or to any Lender for any other transaction
without the express written approval of all of the other Lenders. In the case of
the Administrative Agent, it may do so as if it were not acting as
Administrative Agent hereunder, and the Administrative Agent may accept fees and
other consideration from the Borrower, the Guarantors or any of them for
services in connection with this Agreement or otherwise without having to
account for the same to the Lenders. Although the Agents or a Lender or any of
their respective Affiliates may in the course of such relationships and
relationships with other Persons acquire information about the Borrower, the
Guarantors, their Affiliates and such other Persons, neither the Agents nor such
Lender shall have any duty to the other Lenders or the Agents to disclose such
information to the other Lenders or the Agents except as otherwise provided
herein with respect to the occurrence of an Event of Default.
SECTION 7.05. INDEMNIFICATION OF ADMINISTRATIVE AGENT AND DOCUMENTATION
AGENT. The Lenders agree to indemnify the Administrative Agent, the
Documentation Agent and their directors, officers, employees, agents and
Affiliates (the "Indemnitees") (to the extent not reimbursed under Section 8.04
hereof or under the applicable provisions of any other Loan Document, but
without limiting the obligations of the Borrower and Guarantors under Section
8.04 hereof or such provisions), ratably in accordance with their Pro Rata
Shares of the Total Commitment (without giving effect to any participation in
all or any portion of the Total Commitment sold by them to any other Person),
for any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the
Indemnitees in any way relating to or arising out of this Agreement, any other
Loan Document or any other documents contemplated by or referred to herein or
the transactions contemplated hereby or thereby (including, without limitation,
the costs and expenses which the Borrower and Guarantors are obligated to pay
under Section 8.04 hereof or under the applicable provisions of any other Loan
Document but excluding, unless a Default or Event of Default has occurred,
normal administrative costs and expenses incidental to the performance of its
agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or of any such other documents or instruments; provided that no Lender
shall be liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of an Indemnitee.
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SECTION 7.06. DOCUMENTS. It is the responsibility of the Borrower to
forward to each Lender, on or before the due dates set forth herein, a copy of
each report, notice (other than notices of borrowings and payments) or other
document required by this Agreement or any other Loan Document to be delivered
to the Administrative Agent. Neither Agent is responsible for forwarding such
information to the Lenders.
SECTION 7.07. NON-RELIANCE ON AGENTS AND OTHER LENDERS. Each Lender
agrees that it has, independently and without reliance on the Agents or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower, the Guarantors and
their Subsidiaries and decision to enter into this Agreement and that it will,
independently and without reliance upon the Agents or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not taking
action under this Agreement or any other Loan Document. Neither Agent shall be
required to keep itself informed as to the performance or observance by the
Borrower or Guarantors of this Agreement or any other Loan Document or any other
document referred to or provided for herein or therein or to inspect the
properties or books of the Borrower, the Guarantors or any Subsidiary of the
Borrower or any Guarantor. Except for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to any other Lender to provide any Lender with any credit or
other information concerning the affairs, financial condition or business of the
Borrower, the Guarantors or any Subsidiary (or any of their Affiliates) which
may come into the possession of the Administrative Agent or of its Affiliates.
The Administrative Agent shall not be required to file this Agreement, any other
Loan Document or any document or instrument referred to herein or therein, or
record or give notice of this Agreement, any other Loan Document or any document
or instrument referred to herein or therein, to any Person.
SECTION 7.08. FAILURE OF ADMINISTRATIVE AGENT TO ACT. Except for action
expressly required of the Administrative Agent hereunder, the Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances (which may include
cash collateral) of the indemnification obligations of the Lenders under Section
7.05 hereof in respect of any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action.
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SECTION 7.09. RESIGNATION OF AGENTS. Subject to the appointment and
acceptance of a successor Administrative Agent or Documentation Agent as
provided below, the Administrative Agent or the Documentation Agent may resign
at any time by giving written notice thereof to the other Agent, the Lenders and
the Borrower. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Administrative Agent or Documentation Agent, as the
case may be, which shall be a Lender which has an office in New York, New York
and, provided no Event of Default has occurred and is continuing, which shall be
reasonably acceptable to the Borrower, such acceptance not to be unreasonably
withheld or delayed. If no successor Administrative Agent or Documentation
Agent, as the case may be, shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Administrative Agent's or Documentation Agent's, as the case may be, giving of
notice of resignation, then the retiring Administrative Agent or Documentation
Agent, as the case may be, may, on behalf of the Lenders, appoint a successor
Administrative Agent or Documentation Agent, as the case may be, which shall be
a Lender which has an office in New York, New York and, provided no Event of
Default has occurred and is continuing, which shall be reasonably acceptable to
the Borrower, such acceptance not to be unreasonably withheld or delayed. The
Required Lenders or the retiring Administrative Agent or Documentation Agent, as
the case may be, shall upon the appointment of a successor Administrative Agent
or Documentation Agent, as the case may be, promptly so notify the Borrower, the
Guarantors and the other Lenders. Upon the acceptance of any appointment as
Administrative Agent or Documentation Agent, as the case may be, hereunder by a
successor Administrative Agent or Documentation Agent, as the case may be, such
successor Administrative Agent or Documentation Agent, as the case may be, shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent or Documentation Agent, as the
case may be, and the retiring Administrative Agent or Documentation Agent, as
the case may be, shall be discharged from its duties and obligations hereunder.
After any retiring Administrative Agent's or Documentation Agent's, as the case
may be, resignation as Administrative Agent or Documentation Agent, as the case
may be, the provisions of this Article 7 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as the Administrative Agent or Documentation Agent, as the case may
be.
SECTION 7.10. AMENDMENTS CONCERNING AGENCY FUNCTION. Neither the
Administrative Agent nor the Documentation Agent shall be bound by any waiver,
amendment, supplement or modification of this Agreement or any other Loan
Document which affects its rights or duties hereunder or thereunder unless it
shall have given its prior written consent thereto.
SECTION 7.11. LIABILITY OF AGENTS. Neither Agent shall have any
liabilities or responsibilities to the Borrower, the Guarantors or any of them
on account of the failure of any Lender to perform its obligations hereunder or
to any Lender on account of the failure of the Borrower, the Guarantors or any
of them to perform their or its obligations hereunder or under any other Loan
Document. Nothing herein shall be read to relieve any obligation that either
Agent may have to the Borrower as a Lender hereunder.
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SECTION 7.12. TRANSFER OF AGENCY FUNCTION. Without the consent of the
Borrower, the Guarantors or any Lender, the Administrative Agent may at any time
or from time to time transfer its functions as Administrative Agent hereunder to
any of its offices located in the New York metropolitan area, provided that the
Administrative Agent shall promptly notify the Borrower, the Guarantors and the
Lenders thereof.
SECTION 7.13. WITHHOLDING TAXES. Each Lender represents that it is
entitled to receive any payments to be made to it hereunder without the
withholding of any tax and will furnish to the Administrative Agent such forms,
certifications, statements and other documents as the Administrative Agent may
request from time to time to evidence such Lender's exemption from the
withholding of any tax imposed by any jurisdiction or to enable the
Administrative Agent to comply with any applicable laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Lender is not
created or organized under the laws of the United States of America or any state
thereof, in the event that the payment of interest by the Borrower is treated
for U.S. income tax purposes as derived in whole or in part from sources from
within the United States, such Lender will furnish to the Administrative Agent
Form W-8BEN or Form W-8ECI of the Internal Revenue Service, or such other forms,
certifications, statements or documents, duly executed and completed by such
Lender as evidence of such Lender's exemption from the withholding of United
States tax with respect thereto. The Administrative Agent shall not be obligated
to make any payments hereunder to such Lender in respect of any Loan until such
Lender shall have furnished to the Administrative Agent the requested form,
certification, statement or document.
SECTION 7.14. SEVERAL OBLIGATIONS AND RIGHTS OF LENDERS. The failure of
any Lender to make any Loan to be made by it on the date specified therefor
shall not relieve any other Lender of its obligation to make its Loan on such
date, but no Lender shall be responsible for the failure of any other Lender to
make a Loan to be made by such other Lender.
SECTION 7.15. PRO RATA TREATMENT OF LOANS, ETC. Except to the extent
otherwise provided, each prepayment and payment of principal of, or interest on,
Loans of a particular type and a particular Interest Period, if any, and each
payment of fees or other amounts due hereunder shall be made to the
Administrative Agent for the account of the Lenders holding Loans of such type
and Interest Period, if any, pro rata (except for payments made under the Fee
Letter, which shall be retained by the Administrative Agent for its own account,
and unless otherwise expressly provided otherwise in this Agreement) in
accordance with the respective unpaid principal amounts for such Loans of such
Interest Period held by such Lenders.
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SECTION 7.16. SHARING OF PAYMENTS AMONG LENDERS. If a Lender shall
obtain payment of any principal of or interest on any Loan any fee due
hereunder, made by it through the exercise of any right of setoff, banker's
lien, counterclaim, or any other means, it shall share such payment with the
other Lenders and the amount of such payment shall be applied to reduce the
Loans of all the Lenders pro rata in accordance with the unpaid principal on the
Loans held by each of them, and make such other adjustments from time to time as
shall be equitable to the end that all the Lenders shall share the benefit of
such payment (net of any expenses which may be incurred by such Lender in
obtaining or preserving such benefit) pro rata in accordance with the unpaid
principal and interest on the Loans held by each of them. To such end the
Lenders shall make appropriate adjustments among themselves if such payment is
rescinded or must otherwise be restored. The Borrower agrees that any Lender so
purchasing a participation (or direct interest) in the Loans made by the other
Lenders may exercise all rights of set off, banker's lien, counterclaim or
similar rights with respect to such participation (or direct interest). Nothing
contained herein shall require any Lender to exercise any such right or shall
affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness of the
Borrower. Notwithstanding the foregoing or any other provision of this
Agreement, no right or remedy of any Lender relating to any assets of the
Borrower (including real property, improvements or fixtures) not covered by this
Agreement or the other Loan Documents shall in any way be affected by this
Agreement or otherwise with respect to any other indebtedness of the Borrower to
any of the Lenders.
SECTION 7.17. NONRECEIPT OF FUNDS BY ADMINISTRATIVE AGENT; PAYMENTS TO
LENDERS. (a) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent in its sole discretion may, but
shall not be obligated to, in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent that the Borrower shall not have so made
such payment in full to the Administrative Agent, such Lender agrees to repay to
the Administrative Agent on demand such amount and if for any reason the
Administrative Agent does not receive such amount from such Lender on the day of
such demand, if such demand is made before 2:00 p.m. on such day, or on the next
Business Day if demand is made after 2:00 p.m. on such day, such Lender shall
repay to the Administrative Agent forthwith on demand such amount distributed to
such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Administrative Agent, at the customary rate set by the
Administrative Agent for the correction of errors among lenders for three (3)
Business Days and thereafter at the interest rate applicable to the obligation
that was not repaid by the Borrower, or if no such rate was in effect, at the
Alternate Base Rate.
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(b) If the Administrative Agent shall fail to pay any amounts owing by
the Administrative Agent to a Lender as promptly as may be required by this
Agreement, the Administrative Agent shall pay to such Lender, on its demand,
interest on such delinquent amount at the customary rate set by the
Administrative Agent for the correction of errors among lenders for three (3)
Business Days and thereafter at the Alternate Base Rate.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. Except as otherwise expressly provided
in this Agreement, any provision of this Agreement may be amended or modified
only by an instrument in writing signed by the Borrower, the Guarantors, the
Administrative Agent and the Required Lenders, and any provision of this
Agreement may be waived by the Borrower (if such provision requires performance
by the Administrative Agent or the Lenders) or by the Administrative Agent
acting with the consent of the Required Lenders (if such provision requires
performance by the Borrower or any Guarantor); PROVIDED that no amendment,
modification or waiver shall, unless by an instrument signed by all of the
Lenders or by the Administrative Agent acting with the consent of all of the
Lenders result in: (1) a reduction in the principal amount of the Revolving
Credit Loans or Outstanding L/C Exposure or extension of the Maturity Date; (2)
a reduction in the rate of interest other than as expressly permitted herein or
reduction of any Loan or any fee or any extension of any due date thereof; (3)
an increase in the amount of the Total Commitment; (4) a change in the duration
or the amount of any Lender's Commitment; (5) a modification of the definition
of "Required Lenders" or any provision of this Section 8.01; (6) the assignment
or transfer by the Borrower of any of its rights and obligations under the Loan
Documents; or (7) releases of any Guarantors.
SECTION 8.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic communication)
and mailed, telegraphed, sent by facsimile or delivered, if to the Borrower or a
Guarantor, at the address of the Borrower or Guarantor, as the case may be, set
forth at the beginning of this Agreement and if to the Administrative Agent, the
Documentation Agent or any of the Lenders, at the addresses of the
Administrative Agent, the Documentation Agent and the Lenders set forth at the
beginning of this Agreement to the attention of Del Laboratories, Inc. Account
Officer, or, as to each party, at such other address as shall be designated by
such party in a written notice complying as to delivery with the terms of this
Section 8.02 to the other parties. All such notices and communications shall be
effective two (2) days after mailing or when telegraphed, telecopied or
delivered, except that notices to the Administrative Agent or Lender shall not
be effective until actually received by the Administrative Agent or such Lender.
SECTION 8.03. NO WAIVER, REMEDIES. No failure on the part of either
Agent or any Lender to exercise, and no delay in exercising, any right, power or
remedy under any Loan Document, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right under any Loan Document preclude any
other or further exercise thereof or the exercise of any other right. The
remedies provided in the Loan Documents are cumulative and not exclusive of any
remedies provided by law.
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SECTION 8.04. COSTS AND EXPENSES. The Borrower agrees to pay on demand
all reasonable costs and expenses of the Administrative Agent in connection with
the preparation, execution, delivery and administration of this Agreement, the
Revolving Credit Notes and any other Loan Documents, including, without
limitation, the reasonable fees and expenses of counsel for the Administrative
Agent with respect thereto and with respect to advising the Administrative Agent
as to its rights and responsibilities under this Agreement, and all costs and
expenses, if any (including reasonable counsel fees and expenses), of the
Administrative Agent and the Lenders in connection with the enforcement of this
Agreement, the Revolving Credit Notes and any other Loan Documents. The Borrower
and each Guarantor, jointly and severally, shall at all times protect,
indemnify, defend and save harmless the Administrative Agent and the Lenders
from and against any and all claims, actions, suits and other legal proceedings,
and liabilities, obligations, losses, damages, penalties, judgments, costs,
expenses or disbursements which the Administrative Agent or any of the Lenders
may, at any time, sustain or incur by reason of or in consequence of or arising
out of the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby except as herein provided. The Borrower and
each Guarantor acknowledge that it is the intention of the parties hereto that
this Agreement shall be construed and applied to protect and indemnify the
Administrative Agent and the Lenders against any and all risks involved in the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby, all of which risks are hereby assumed by the
Borrower and the Guarantors, including, without limitation, any and all risks of
the acts or omissions, whether rightful or wrongful, of any present or future DE
JURE or DE FACTO government or governmental authority, provided that neither the
Borrower nor any Guarantor shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Administrative Agent's or any
Lender's gross negligence or willful misconduct. The provisions of this Section
8.04 shall survive the payment of the Notes and the termination of this
Agreement.
SECTION 8.05. RIGHT OF SET-OFF. Upon the occurrence and during the
continuance of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender, or any Affiliate of such Lender to or for the credit or the account of
the Borrower or any Guarantor against any and all of the obligations of the
Borrower or the Guarantors now or hereafter existing under this Agreement and
the Revolving Credit Notes, irrespective of whether or not the Administrative
Agent shall have made any demand under this Agreement or the Revolving Credit
Notes and although such obligations may be unmatured. The rights of the
Administrative Agent and the Lenders under this Section are in addition to all
other rights and remedies (including, without limitation, other rights of
set-off) which they may have.
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SECTION 8.06. BINDING EFFECT. This Agreement shall become effective
when it shall have been executed by the Borrower, the Guarantors, the Agents and
the Lenders and thereafter it shall be binding upon and inure to the benefit of
the Borrower, the Guarantors, the Agents and the Lenders and their respective
permitted successors and assigns.
SECTION 8.07. SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective permitted successors and assigns, except that the Borrower
may not assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of all Lenders.
(b) Any Lender may at any time grant to one or more lenders or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans or its obligations in connection with Letters of Credit.
In the event of any such grant by a Lender of a participating interest to a
Participant, whether or not upon notice to the Borrowers and the Administrative
Agent, such Lender shall remain responsible for the performance of its
obligations hereunder, and the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement pursuant to
which any Lender may grant such a participating interest shall provide that such
Lender shall retain the sole right and responsibility to enforce the obligations
of the Borrower hereunder including, without limitation, the right to approve
any amendment, modification or waiver of any provision of this Agreement. The
Borrower agrees that each Participant shall, to the extent provided in its
participation agreement, be entitled to the benefits of Section 8.05 of this
Agreement and this subparagraph (b) with respect to its participating interest.
An assignment or other transfer which is not permitted by subsection (c) or (d)
below shall be given effect for purposes of this Agreement only to the extent of
a participating interest granted in accordance with this subsection (b).
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(c) (i) Any Lender may at any time assign to one or more lenders or
other institutions (each an "Assignee") all, or a proportionate part (equivalent
to an initial Commitment of not less than $5,000,000.00) of all, of its rights
and obligations under this Agreement, the Notes and its obligations in
connection with Letters of Credit and/or B/As, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit B hereto executed by such Assignee and such
transferor Lender, with the subscribed consent of the Administrative Agent and,
if no Event of Default has occurred and is continuing, the Borrower, which
consent in either case shall not be unreasonably withheld. Upon execution and
delivery of such instrument and payment by such Assignee to such transferor
Lender of an amount equal to the purchase price agreed between such transferor
Lender and such Assignee, such Assignee shall be a Lender party to this
Agreement and shall have all the rights and obligations of a Lender with a
Commitment as set forth in such instrument of assumption, and the transferor
Lender shall be released from its obligations hereunder to a corresponding
extent, and no further consent or action by any party shall be required.
(ii) Upon the consummation of any assignment pursuant to this
subsection (c), the transferor Lender, the Administrative Agent and the Borrower
shall make appropriate arrangements so that, if required, new Notes are issued
to the Assignor and the Assignee and the Assignor shall surrender its original
Note for cancellation. In connection with any such assignment, the transferor
Lender shall pay to the Administrative Agent an administrative fee for
processing such assignment in the amount of $3,000.00 and the reasonable fees of
the Administrative Agent's counsel. If an Assignee is not incorporated under the
laws of the United States of America or a state thereof, it shall deliver to the
Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 7.13 hereof.
(d) Any Lender may at any time assign all or any portion of its rights
under this Agreement and its Notes to a Federal Reserve Bank. No such assignment
shall release the transferor Lender from its obligations hereunder.
SECTION 8.08. FURTHER ASSURANCES. The Borrower and each Guarantor agree
at any time and from time to time at its expense, upon the reasonable request of
the Administrative Agent or its counsel, to promptly execute, deliver, or obtain
or cause to be executed, delivered or obtained any and all further instruments
and documents and to take or cause to be taken all such other action the
Administrative Agent may deem reasonable and desirable in obtaining the full
benefits of, this Agreement or any other Loan Document.
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SECTION 8.09. SECTION HEADINGS, SEVERABILITY, ENTIRE AGREEMENT. Section
and subsection headings have been inserted herein for convenience only and shall
not be construed as part of this Agreement. Every provision of this Agreement
and each Loan Document is intended to be severable; if any term or provision of
this Agreement, any Loan Document, or any other document delivered in connection
herewith shall be invalid, illegal or unenforceable for any reason whatsoever,
the validity, legality and enforceability of the remaining provisions hereof or
thereof shall not in any way be affected or impaired thereby. All exhibits and
schedules to this Agreement shall be annexed hereto and shall be deemed to be
part of this Agreement. This Agreement and the exhibits and schedules attached
hereto embody the entire Agreement and understanding among the Borrower, the
Guarantors, the Agents and the Lenders and supersede all prior agreements and
understandings relating to the subject matter hereof.
SECTION 8.10. CONFIDENTIALITY. The Agents, the Lenders and each of
their assignees and participants agree to use commercially reasonable efforts
(reasonably equivalent to the efforts the Agents, a Lender or such assignee or
participant applies to maintaining the confidentiality of its own confidential
information) to maintain as confidential all confidential information provided
to them by the Borrower or any of its Subsidiaries, except that the Agents, a
Lender and any assignee or participant may disclose such information (a) to
Persons employed or engaged by the Agents, a Lender or such assignee or
participant in evaluating, approving, structuring or administering this
Agreement, the Loans or its Commitment, provided such Persons have been
instructed to treat such information as confidential in accordance with this
Section 8.10; (b) to any bona fide assignee or participant or potential assignee
or participant that has agreed to comply with the covenant contained in this
Section 8.10 (and any such bona fide assignee or participant or potential
assignee or participant may disclose such information to Persons employed or
engaged by them as described in CLAUSE (A) above); (c) as required or requested
by any governmental authority or reasonably believed by the Agents, a Lender or
such assignee or participant to be compelled by any court decree, subpoena or
legal or administrative order or process; (d) as, in the opinion of the Agent's,
a Lender's or such assignee's or participant's counsel, required by law; (e) in
connection with the exercise of any right or remedy under the Loan Documents or
in connection with any litigation to which the Agents, a Lender or such assignee
or participant is a party arising in connection with any Loan Document; or (f)
which ceases to be confidential through no fault of the Agents, a Lender or such
assignee or participant. In the event that any Lender receives a request or
demand to disclose any confidential information pursuant to any subpoena or
court order, such Lender agrees to the extent permitted by applicable law or if
permitted by applicable law, statute, rule or regulation to the extent such
Lender determines in good faith that it will not create any risk of liability to
such Lender, that such Lender will promptly notify Borrower of such request so
that Borrower may seek a protective order or other appropriate relief or remedy.
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SECTION 8.11. GOVERNING LAW. This Agreement, the Revolving Credit Notes
and all other Loan Documents shall be governed by, and construed in accordance
with, the laws of the State of New York, without regard to principles of
conflict of laws.
SECTION 8.12. WAIVER OF JURY TRIAL. THE BORROWER, EACH GUARANTOR, THE
AGENTS AND THE LENDERS WAIVE ALL RIGHTS TO TRIAL BY JURY ON ANY CAUSE OF ACTION
DIRECTLY OR INDIRECTLY INVOLVING THE TERMS, COVENANTS OR CONDITIONS OF THIS
AGREEMENT OR ANY LOAN DOCUMENT.
SECTION 8.13. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
(THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
DEL LABORATORIES, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Financial Officer
DEL PHARMACEUTICALS, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Financial Officer
PARFUMS SCHIAPARELLI, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Financial Officer
ROYCE & ▇▇▇▇▇, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Financial Officer
565 BROAD HOLLOW REALTY CORP.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Financial Officer
JPMORGAN CHASE BANK, as
Administrative Agent
By /s/ ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
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FLEET NATIONAL BANK,
as Documentation Agent
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
JPMORGAN CHASE BANK
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
FLEET NATIONAL BANK
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
CITIBANK, N.A.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice President
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