EXHIBIT 10.7
$100,000,000
CREDIT AND SECURITY AGREEMENT
dated as of
January 10, 2003,
among
COMMSCOPE, INC. OF NORTH CAROLINA
as Borrower,
The Lenders listed herein,
and
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent
Arranger: WACHOVIA SECURITIES, INC.
TABLE OF CONTENTS
CREDIT AGREEMENT
Page
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ARTICLE 1 DEFINITIONS...................................................1
SECTION 1.01. Definitions..........................................1
SECTION 1.02. Accounting Terms and Determinations.................30
SECTION 1.03. References..........................................30
SECTION 1.04. Use of Defined Terms................................30
SECTION 1.05. Terminology.........................................31
ARTICLE 2 THE CREDITS..................................................31
SECTION 2.01. Commitments to Lend.................................31
SECTION 2.02. Method of Borrowing.................................34
SECTION 2.03. Continuation and Conversion Elections...............36
SECTION 2.04. Notes...............................................36
SECTION 2.05. Maturity of Loans...................................37
SECTION 2.06. Interest Rates......................................37
SECTION 2.07. Fees................................................39
SECTION 2.08. Optional Termination or Reduction of Commitments....39
SECTION 2.09. Mandatory Reduction and Termination of
Commitments.........................................40
SECTION 2.10. Optional Prepayments................................40
SECTION 2.11. Mandatory Prepayments...............................40
SECTION 2.12. General Provisions as to Payments...................41
SECTION 2.13. Computation of Interest and Fees....................46
SECTION 2.14. All Loans to Constitute One Obligation..............46
SECTION 2.15. Lockbox; Collateral Reserve Accounts; Control
Agreements..........................................46
SECTION 2.16. Issuance of Letters of Credit.......................47
SECTION 2.17. Conditions and Amounts of Letters of Credit.........48
SECTION 2.18. Requests for Issuance of Letters of Credit..........48
SECTION 2.19. Letter of Credit Reimbursement Obligations;
Duties of the LC Issuer.............................49
SECTION 2.20. Letter of Credit Participations.....................50
SECTION 2.21. Payment of Letter of Credit Reimbursement
Obligations.........................................51
TABLE OF CONTENTS
(continued)
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SECTION 2.22. Compensation for Letters of Credit and
Reporting Requirements..............................52
SECTION 2.23. Indemnification and Exoneration with respect to
Letters of Credit...................................53
ARTICLE 3 COLLATERAL...................................................54
SECTION 3.01. Grant of Security Interest..........................54
SECTION 3.02. Further Assurances..................................56
ARTICLE 4 REPRESENTATIONS AND WARRANTIES...............................56
SECTION 4.01. Corporate Existence and Power.......................56
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention.......................................56
SECTION 4.03. Binding Effect......................................57
SECTION 4.04. Financial Information...............................57
SECTION 4.05. Litigation..........................................57
SECTION 4.06. Compliance with ERISA...............................57
SECTION 4.07. Compliance with Laws; Payment of Taxes..............58
SECTION 4.08. Investment Company Act..............................58
SECTION 4.09. Public Utility Holding Company Act..................58
SECTION 4.10. Ownership of Property; Liens........................58
SECTION 4.11. No Default..........................................58
SECTION 4.12. Full Disclosure.....................................58
SECTION 4.13. Environmental Matters...............................58
SECTION 4.14. Capital Stock.......................................59
SECTION 4.15. Margin Stock........................................59
SECTION 4.16. Insolvency..........................................60
SECTION 4.17. Insurance...........................................60
SECTION 4.18. Purchase of Collateral..............................60
SECTION 4.19. Possession of Permits...............................60
SECTION 4.20. Labor Disputes......................................61
SECTION 4.21. Surety Obligations..................................61
SECTION 4.22. Restrictions........................................61
SECTION 4.23. Leases..............................................61
TABLE OF CONTENTS
(continued)
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SECTION 4.24. Trade Relations.....................................61
SECTION 4.25. Capital Structure...................................62
SECTION 4.26. Article 9 Information...............................62
SECTION 4.27. Accounts............................................62
SECTION 4.28. Good Title to Collateral............................62
SECTION 4.29. Right to Assign and Grant Security Interest.........62
SECTION 4.30. Trade Styles........................................62
SECTION 4.31. Farm Products.......................................63
SECTION 4.32. Investment Property.................................63
SECTION 4.33. Intellectual Property...............................63
SECTION 4.34. Account Debtor Capacity and Solvency................64
SECTION 4.35. Proceedings with Respect to Accounts................64
SECTION 4.36. Location of Collateral..............................64
SECTION 4.37. Inventory...........................................64
SECTION 4.38. Material Contracts..................................65
SECTION 4.39. Survival of Representations and Warranties..........65
SECTION 4.40. Force Majeure.......................................65
ARTICLE 5 COVENANTS....................................................65
SECTION 5.01. Information.........................................65
SECTION 5.02. Inspection of Property, Books and Records...........69
SECTION 5.03. Maintenance of Existence and Management.............69
SECTION 5.04. Dissolution.........................................69
SECTION 5.05. Consolidations and Mergers..........................69
SECTION 5.06. Use of Proceeds.....................................70
SECTION 5.07. Compliance with Laws; Payment of Taxes..............70
SECTION 5.08. Insurance; Net Casualty/Insurance Proceeds..........70
SECTION 5.09. Change in Fiscal Year...............................71
SECTION 5.10. Maintenance of Property.............................71
SECTION 5.11. Material Contracts..................................71
SECTION 5.12. Environmental Matters...............................72
SECTION 5.13. Environmental Release...............................72
TABLE OF CONTENTS
(continued)
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SECTION 5.14. Transactions with Affiliates........................72
SECTION 5.15. Special Provisions Concerning Subsidiaries..........72
SECTION 5.16. Restricted Payments and Investments and
Acquisitions........................................73
SECTION 5.17. Permitted Liens.....................................75
SECTION 5.18. Restrictions on Ability of Borrower and
Subsidiaries to Pay Dividends.......................77
SECTION 5.19. Financial Covenants.................................77
SECTION 5.20. Permitted Debt......................................77
SECTION 5.21. Limitation on Issuance and Sale of Capital
Stock and Redeemable Preferred Stock of
Subsidiaries........................................79
SECTION 5.22. Change of Principal Place of Business or
Location of Collateral..............................79
SECTION 5.23. Physical Inventories................................79
SECTION 5.24. Inventory Returns...................................79
SECTION 5.25. Intellectual Property...............................79
SECTION 5.26. Records Respecting Collateral.......................81
SECTION 5.27. Reports Respecting Collateral.......................82
SECTION 5.28. Collateral Location Waivers.........................82
SECTION 5.29. Appraisals; Field Examinations......................82
SECTION 5.30. Dispositions of Collateral..........................82
SECTION 5.31. Changes to Federal Taxpayer Identification
Number; Organizational Identification Number........83
SECTION 5.32. Discounts and Allowances............................83
SECTION 5.33. Taxes Owing with Respect to Accounts................83
SECTION 5.34. Commercial Tort Claims..............................84
ARTICLE 6 DEFAULTS.....................................................84
SECTION 6.01. Events of Default...................................84
SECTION 6.02. Notice of Default...................................87
SECTION 6.03. Remedies with Respect to Collateral.................87
SECTION 6.04. Power of Attorney...................................89
ARTICLE 7 THE AGENT AND THE LENDERS....................................89
SECTION 7.01. Appointment; Powers and Immunities..................89
TABLE OF CONTENTS
(continued)
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SECTION 7.02. Reliance by Agent...................................90
SECTION 7.03. Defaults............................................91
SECTION 7.04. Rights of Agent and its Affiliates as a Lender......91
SECTION 7.05. Indemnification.....................................91
SECTION 7.06. Payee of Note Treated as Owner......................92
SECTION 7.07. Nonreliance on Agent and Other Lenders..............92
SECTION 7.08. Failure to Act......................................92
SECTION 7.09. Resignation of Agent................................93
SECTION 7.10. Joinder of Lenders..................................93
SECTION 7.11. Agreements Regarding Collateral.....................93
SECTION 7.12. Agent Field Examinations; Appraisals................93
SECTION 7.13. Designation of Co-Agent.............................94
SECTION 7.14. Replacement of Certain Lenders......................95
ARTICLE 8 CHANGE IN CIRCUMSTANCES; COMPENSATION........................95
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair...........................................95
SECTION 8.02. Illegality..........................................96
SECTION 8.03. Increased Cost and Reduced Return...................96
SECTION 8.04. Base Rate Loans or Other Euro-Dollar Loans
Substituted for Affected Euro-Dollar Loans..........97
SECTION 8.05. Compensation........................................98
ARTICLE 9 CONDITIONS TO BORROWINGS AND ISSUANCE OF LETTERS OF
CREDIT.......................................................98
SECTION 9.01. Conditions to Initial Borrowing and issuance of
any Letter of Credit................................98
SECTION 9.02. Conditions to All Borrowings and Issuances of
Letters of Credit..................................101
ARTICLE 10 MISCELLANEOUS...............................................102
SECTION 10.01. Notices............................................102
SECTION 10.02. No Waivers.........................................102
SECTION 10.03. Expenses; Documentary Taxes........................103
SECTION 10.04. Indemnification....................................103
SECTION 10.05. Setoff; Sharing of Setoffs.........................103
TABLE OF CONTENTS
(continued)
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SECTION 10.06. Amendments and Waivers.............................105
SECTION 10.07. No Margin Stock Collateral.........................106
SECTION 10.08. Successors and Assigns.............................106
SECTION 10.09. Confidentiality....................................109
SECTION 10.10. Representation by Lenders..........................109
SECTION 10.11. Obligations Several................................109
SECTION 10.12. New York Law.......................................109
SECTION 10.13. Severability.......................................109
SECTION 10.14. Interest...........................................110
SECTION 10.15. Interpretation.....................................110
SECTION 10.16. WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION......111
SECTION 10.17. Counterparts.......................................111
SECTION 10.18. Source of Funds -- ERISA...........................111
SECTION 10.19. Credit Inquiries...................................111
SECTION 10.20. Consequential Damages..............................111
SECTION 10.21. Entire Agreement...................................111
SECTION 10.22. Continuing Agreement...............................112
EXHIBITS:
EXHIBIT A-1 - Form of Revolving Loan Note
EXHIBIT A-2 - Form of Settlement Loan Note
EXHIBIT B-1 - Form of Opinion of General Counsel to Borrower, Parent
and Initial Subsidiary Guarantors
EXHIBIT B-2 - Form of Opinion of Special Counsel to Borrower, Parent
and Initial Subsidiary Guarantors
EXHIBIT B-3 - Form of Local Counsel's Opinion
EXHIBIT C - Form of Agent's Opinion
EXHIBIT D - Form of Assignment and Acceptance
EXHIBIT E-1 - Form of Notice of Borrowing
EXHIBIT E-2 - Form of Notice of Continuation or Conversion
EXHIBIT F - Form of Borrowing Base Certificate
EXHIBIT G - Form of Compliance Certificate
EXHIBIT H - Form of Closing Certificate
EXHIBIT I - Form of Officer's Certificate
EXHIBIT J - Form of Waiver Agreement
EXHIBIT K - Form of Telephone Instruction Letter
EXHIBIT L - Form of Contribution Agreement
EXHIBIT M - Form of Collateral Disclosure Certificate
EXHIBIT N - Form of Pledge Agreement
EXHIBIT O - Form of Mortgage
EXHIBIT P-1 - Form of Letter of Credit Request
EXHIBIT P-2 - Form of Notice of Letter of Credit
EXHIBIT Q - Form of Deposit Account Control Agreement
EXHIBIT R - Form of Securities Account Control Agreement
EXHIBIT S - Form of Guaranty
EXHIBIT T - Form of Joinder Agreement
SCHEDULES:
SCHEDULE 3.01 - Permitted Encumbrances
SCHEDULE 4.04 - Material Events
SCHEDULE 4.05 - Litigation
SCHEDULE 4.13 - Environmental Matters
SCHEDULE 4.21 - Surety Obligations
SCHEDULE 4.22 - Burdensome Restrictions
SCHEDULE 4.23 - Leases
SCHEDULE 4.25 - Capital Structure
SCHEDULE 5.14 - Affiliate Transactions
SCHEDULE 5.20 - Existing Debt
CONFIDENTIAL
CREDIT AND SECURITY AGREEMENT
THIS CREDIT AND SECURITY AGREEMENT dated as of January 10, 2003,
is made by and among COMMSCOPE, INC. OF NORTH CAROLINA, the Lenders listed
on the signature pages hereof and WACHOVIA BANK, NATIONAL ASSOCIATION, as a
Lender and as Agent.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this SECTION
1.01 shall, for all purposes of this Agreement and any amendment hereto
(except as herein otherwise expressly provided), have the meanings set
forth herein:
"Accounts" means all "accounts" as such term is defined in the
UCC and, in any event, includes, without limitation, all accounts
receivable, other receivables, and all other rights to payment for property
sold, leased, licensed, assigned or otherwise disposed of, for a policy of
insurance issued or to be issued, for a secondary obligation incurred or to
be incurred, for energy provided or to be provided, for the use or hire of
a vessel under a charter or other contract, arising out of the use of a
credit card or charge card, or for services rendered or to be rendered or
in connection with any other transaction (whether or not yet earned by
performance), all Health-Care-Insurance Receivables, all rights in, to, and
under all purchase orders or receipts for goods or services, all rights to
any goods represented by any of the foregoing, including, without
limitation, all rights of rescission, replevin, reclamation, and stoppage
in transit and rights to returned, reclaimed, or repossessed goods, all
books, records, computer tapes, programs and ledger books arising therefrom
or relating thereto, all collateral security of any kind, given by any
Account Debtor or any other Person with respect to any of the foregoing,
all whether now owned or existing or hereafter acquired or arising, by or
in favor of, the Borrower or any Guarantor.
"Account Debtor" means the Person who is obligated on any
Account, Chattel Paper, or General Intangible.
"Adjusted London Interbank Offered Rate" has the meaning set
forth in SECTION 2.06(c).
"Affected Lender" has the meaning set forth in SECTION 7.14.
"Affiliate" of any relevant Person means (a) any Person that
directly, or indirectly through one or more intermediaries, controls the
relevant Person (a "Controlling Person"), (b) any Person (other than the
relevant Person or a Subsidiary of the relevant Person) which is controlled
by or is under common control with a Controlling Person, or (c) any Person
(other than a Subsidiary of the relevant Person) of which the relevant
Person owns, directly or indirectly, 10% or more of the common stock or
equivalent equity interests. As used herein, the
CONFIDENTIAL
term "control" means possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person,
whether through the ownership of voting securities, by contract or
otherwise. Notwithstanding the foregoing, no corporation the common stock
of which is publicly traded shall be deemed an Affiliate of the Parent, the
Borrower or any Subsidiary of the Borrower solely by reason of the fact
that an executive officer of the Parent also serves as a director of such
corporation.
"Agent" means Wachovia Bank, National Association, a national
banking association organized under the laws of the United States of
America, in its capacity as agent for the Lenders hereunder, and its
successors and permitted assigns in such capacity.
"Aggregate Real Properties" has the meaning set forth in SECTION
4.13(a).
"Aggregate Commitments" means the sum of all the Commitments,
which, as of the Closing Date equals One Hundred Million and No/00 Dollars
($100,000,000).
"Aggregate Revolving Loan Amount Outstanding" means at any time
the sum of the aggregate principal amount outstanding under the Revolving
Loans (including, without limitation, the Settlement Loans).
"Agreement" means this Credit and Security Agreement, together
with all amendments and supplements hereto.
"Amortizing Equipment Availability Amount" means an amount equal
to 85% of the net orderly liquidation value of the eligible Equipment as
determined by the Agent on the Closing Date in its reasonable discretion;
provided that the Amortizing Equipment Availability Amount shall be reduced
from the initial Amortizing Equipment Availability Amount in effect on the
Closing Date as set forth below on the last day of each successive month
after the Closing Date, on 6 year schedule of level monthly amortization,
and further provided that upon any sale or material decline in value, as
determined by the Agent based upon a new appraisal, of any asset included
in the calculation of such value, the Amortizing Equipment Availability
Amount shall be reduced by the amount of such sold asset that was included
in such calculation, or by the amount of such decline in value, as
applicable. The Amortizing Equipment Availability Amount on the Closing
Date is $23,840,000.
"Applicable Margin" has the meaning set forth in SECTION 2.06(a).
"Approved Depositary" means either (a) the Agent or a Lender, or
(b) another depositary bank upon the execution and delivery by the Agent
and such other depositary bank and the Borrower or relevant Guarantor of a
Deposit Account Control Agreement.
"Approved Headquarters Facility Mortgage Debt" means Debt of the
Borrower secured by a first priority deed of trust on the Headquarters
Facility, provided that the amount of such debt and the material terms and
conditions thereof (including, without limitation, the interest rate, fees,
amortization and maturity) have been approved by the Agent and the Required
Lenders in their reasonable credit judgment.
CONFIDENTIAL
"Approved Securities Intermediary" means either (a) the Agent or
a Lender, or (b) another depositary bank upon the execution and delivery by
the Agent and such other depositary bank and the Borrower or relevant
Guarantor of a Securities Account Control Agreement.
"Arranger" means Wachovia Securities, Inc.
"Assignee" has the meaning set forth in SECTION 10.08(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with SECTION 10.08(c) in the form of EXHIBIT D.
"Authority" has the meaning set forth in SECTION 8.02.
"Bankruptcy Code" means Title 11 of the United States Code, as it
may be amended from time to time.
"Base Rate" means for any Base Rate Loan for any day, the rate
per annum equal to the higher as of such day of (a) the Prime Rate, or (b)
one-half of one percent above the Federal Funds Rate. For purposes of
determining the Base Rate for any day, changes in the Prime Rate or the
Federal Funds Rate shall be effective on the date of each such change.
"Base Rate Loan" means a Loan which bears or is to bear interest
at a rate based upon the Base Rate, and is to be made as a Base Rate Loan
pursuant to the applicable Notice of Borrowing, Notice of Continuation or
Conversion, SECTION 2.02(f), or ARTICLE 8, as applicable.
"Borrower" means CommScope, Inc. of North Carolina, a North
Carolina corporation, and its successors and permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans and
Refunding Loans made to the Borrower (a) at the same time by all of the
Lenders, in the case of a Revolving Loan Borrowing, or (b) separately by
Wachovia, in the case of a Settlement Loan Borrowing, in each case pursuant
to ARTICLE 2. A Borrowing is a "Revolving Loan Borrowing" if such Loans are
Revolving Loans, a "Settlement Loan Borrowing" if such Loans are Settlement
Loans, a "Syndicated Borrowing" if such Loans are Syndicated Loans, a
"Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans, and a "Base
Rate Borrowing" if such Loans are Base Rate Loans.
"Borrowing Base" means the following sum:
(a) an amount equal to 85% of the face dollar value (net of any
counterclaim, defense, setoff, retainage or deduction) of
Eligible Accounts as of the date of determination;
PLUS
(b) the lesser of
CONFIDENTIAL
(i) (A) an amount equal to 50% of the dollar value of the
Eligible Inventory consisting of finished goods, valued
at the lower of cost (on a first-in, first- out basis)
or market value as of the date of determination;
plus
(B) an amount equal to 40% of the face dollar value of
the Eligible Inventory consisting of its raw materials,
valued at the lower of cost (on a first-in, first-out
basis) or market value as of the date of determination;
and
(ii) $30,000,000;
PLUS
(c) the Amortizing Equipment Availability Amount;
MINUS
(d) an amount equal to 100% of the Letter of Credit Obligations;
MINUS
(e) at any time during which (i) there is, or after giving
effect to any requested Revolving Loan or issuance of a
Letter of Credit, there would be, Excess Borrowing
Availability of less than $50,000,000, or (ii) the Current
Derivative Exposure is equal to or in excess of $5,000,000,
or (iii) a Default or Event of Default is in existence, a
reserve in the amount of the Current Derivative Exposure;
MINUS
(f) Such other reserves as the Agent may, or at the direction of
the Required Lenders will, establish from time to time in
its or their commercially reasonable judgment by written
notice to the Borrower and the Lenders.
"Borrowing Base Certificate" means a certificate in the form of
EXHIBIT F.
"BrightWave Revolving Credit Commitment" means the existing
commitment of CommScope Optical to provide revolving credit loans, in an
aggregate amount outstanding at any time not exceeding $30,000,000, to OFS
BrightWave, from time to time until the termination of such commitment on
November 16, 2006.
CONFIDENTIAL
"Capital Stock" means any Equity Interest other than Redeemable
Preferred Stock of the Parent or any Subsidiary (to the extent issued to a
Person other than the Borrower or any Guarantor), whether common or
preferred.
"Casualty" means any act or occurrence of any kind or nature that
results in damage, loss or destruction to the Collateral.
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C.ss.9601 et. seq. and its
implementing regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to CERCLA.
"Certified Public Accountants" means the Parent's independent
certified public accountants as of the Closing Date and such other firm or
firms of nationally recognized independent certified public accountants
which may be retained by the Parent thereafter for the purpose of auditing
its financial statements.
"Change of Law" shall have the meaning set forth in SECTION 8.02.
"Chattel Paper" means "chattel paper" as such term is defined in
the UCC, and includes, without limitation, Electronic Chattel Paper, all
whether now owned or existing or hereafter acquired or arising, by or in
favor of, the Borrower or any Guarantor.
"Closing Certificate" has the meaning set forth in SECTION
9.01(e).
"Closing Date" means January 10, 2003.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code.
"Collateral" means (a) the personal property in which the Agent,
for the benefit of the Lenders, is granted a security interest pursuant to
SECTION 3.01, (b) the Real Property conveyed to the Agent pursuant to the
Mortgages, and (c) the Pledged Stock pledged to the Agent pursuant to the
Pledge Agreement.
"Collateral Disclosure Certificates" means, individually or
collectively, as the context shall require, the Collateral Disclosure
Certificates dated as of even date herewith, substantially in the form of
EXHIBIT M, executed by the Borrower, the Parent and the Initial Subsidiary
Guarantors and containing disclosure of information pertaining to the
Collateral.
"Collateral Locations" means the respective Executive Office of
the Borrower and each Guarantor and those additional locations, if any, of
the Borrower and each Guarantor set forth and described in the Collateral
Disclosure Certificates.
"Collateral Reserve Account" means each Deposit Account over
which the Agent has control by virtue of such Deposit Account's being
maintained with the Agent and (b) which
CONFIDENTIAL
the Borrower or any Guarantor is or may be required to open and maintain
with the Agent pursuant to the requirements of SECTION 2.15.
"Commercial Tort Claims" means each of the Borrower's and each
Guarantor's "commercial tort claims" as such term is defined in the UCC,
and includes, without limitation, those commercial tort claims described in
the Collateral Disclosure Certificates, if any, and all other commercial
tort claims with respect to which the Borrower or any Guarantor has given
the Agent notice in accordance with SECTION 5.34.
"Commitment" means, (a) as of the Closing Date, with respect to
Wachovia $35,000,000; PNC Bank, National Association, 25,000,000; BNP
Paribas, $20,000,000; Branch Banking and Trust Company, $10,000,000; and
CIBC, Inc., $10,000,000; and (b) as to any Lender which enters into any
Assignment and Acceptance (whether as transferor Lender or as Assignee
thereunder), the amount of such Lender's Revolving Commitment after giving
effect to such Assignment and Acceptance, in each case as such amount may
be reduced from time to time pursuant to SECTIONS 2.08 and 2.09.
"Commitment Percentage" means, for each Lender, the percentage
equal to its Commitment divided by the Aggregate Commitments.
"CommScope Optical" means CommScope Optical Technologies, Inc., a
Delaware corporation, and its successors and assigns.
"Compliance Certificate" has the meaning set forth in SECTION
5.01(d).
"Condemnation" means any taking of title, of use, or of any other
property interest under the exercise of the power of eminent domain,
whether temporarily or permanently, by any governmental authority or by any
Person acting under governmental authority.
"Condemnation Awards" means any and all judgments, awards of
damages (including, but not limited to, severance and consequential
damages), payments, proceeds, settlements, amounts paid for a taking in
lieu of Condemnation, or other compensation heretofore or hereafter made,
including interest thereon, and the right to receive the same, as a result
of, or in connection with, any Condemnation or threatened Condemnation.
"Consolidated Cash Taxes" means, for the relevant fiscal period,
calculated on a consolidated basis in accordance with GAAP for the Parent
and its Consolidated Subsidiaries, the aggregate of all taxes, to the
extent they are paid in cash during such fiscal period.
"Consolidated EBITDA" means the sum of the following, calculated
on a consolidated basis in accordance with GAAP for the Parent and its
Consolidated Subsidiaries, for the relevant fiscal period: (a) Consolidated
Net Income for such period, (i) including earnings and losses from
discontinued operations, (ii) excluding extraordinary non-cash gains and
losses, and (iii) excluding non-cash gains and losses relating to OFS
BrightWave; plus (b) depreciation and amortization expense (which excludes
amortization of deferred financing fees and other debt-related charges and
writeoffs included in interest expense); plus (c) Consolidated Net Interest
Expense; plus (d) income tax expense , minus (e) income tax benefit, plus
(f) non-cash compensation expenses for such period arising from the sale of
stock, the granting of stock
CONFIDENTIAL
options, the granting of stock appreciation rights and similar
arrangements, plus (g) to the extent included within such period,
write-offs recorded during the first and second Fiscal Quarters of Fiscal
Year 2002 of accounts receivable owed by Adelphia Communications Corp. and
its Subsidiaries, plus (h) other non-cash impairment charges recorded
during such period.
"Consolidated Fixed Charges" means, for any fiscal period, the
sum of the following for such period, calculated on a consolidated basis in
accordance with GAAP for the Parent and its Consolidated Subsidiaries: (a)
cash payments of interest, including amounts expensed and capitalized; plus
(b) cash payments of principal under long-term Debt.
"Consolidated Liabilities" means the sum of (a) all liabilities
that, in accordance with GAAP, should be classified as liabilities on a
consolidated balance sheet of the Parent and its Consolidated Subsidiaries,
and (b) to the extent not included in clause (a) of this definition, all
Redeemable Preferred Stock of the Parent and its Consolidated Subsidiaries.
"Consolidated Net Funded Debt" means, on any date of measurement,
the sum of: (a) all Debt of the Parent and its Consolidated Subsidiaries,
other than Debt of the types described in clause (e) of the definition of
"Debt" and Debt of the types described in clause (g) of the definition of
Debt, to the extent of undrawn amounts available to be paid, less (b) all
cash and cash equivalents of the Parent and its Consolidated Subsidiaries.
"Consolidated Net Income" means, for any relevant fiscal period,
the Net Income of the Parent and its Consolidated Subsidiaries for such
period, determined on a consolidated basis, but excluding extraordinary
items.
"Consolidated Net Interest Expense" for any relevant fiscal
period means interest recognized as expense, net of interest recognized as
income, in accordance with GAAP during such period in respect of Debt of
the Parent or any of its Consolidated Subsidiaries outstanding during such
period (including the interest component of Tax Retention Operating
Leases), determined on a consolidated basis in accordance with GAAP.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which, in accordance with GAAP, would be
consolidated with those of the Parent in its consolidated financial
statements as of such date.
"Consolidated Tangible Net Worth" means, as of any date of
determination, Stockholders' Equity as of such date, less the sum of the
value, as set forth or reflected on the then most recent consolidated
balance sheet of the Parent and its Consolidated Subsidiaries, prepared in
accordance with GAAP, of:
(a) Any surplus resulting from any write-up of assets subsequent
to December 31, 2001;
(b) All assets which would be treated as intangible assets for
balance sheet presentation purposes under GAAP, including without
limitation goodwill (whether representing the excess of cost over book
value of assets acquired, or otherwise), trademarks, tradenames,
copyrights, patents and technologies, and unamortized debt discount and
expense, and unamortized capital startup costs;
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(c) To the extent not included in (b) of this definition, any
amount at which shares of Capital Stock of the Parent appear as an asset on
the balance sheet of the Parent and its Consolidated Subsidiaries;
(d) Loans or advances to stockholders, directors, officers or
employees;
(e) To the extent not included in (b) of this definition,
deferred expenses (not including deferred taxes); and
(f) Affiliate and shareholder loans of the Parent and its
Consolidated Subsidiaries.
"Contribution Agreement" means the Contribution Agreement of even
date herewith in substantially the form of EXHIBIT L to be executed by the
Parent and each Subsidiary Guarantor.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as a
single employer under SECTION 414 of the Code.
"Copyrights" means (a) all copyrights arising under the laws of
the United States, any other country or any political subdivision thereof,
whether registered or unregistered and whether published or unpublished
(including, without limitation, those listed in the Collateral Information
Certificates), all registrations and recordings thereof, and all
applications in connection therewith, including, without limitation, all
registrations, recordings and applications in the United States Copyright
Office, and (b) the right to obtain all renewals thereof.
"Copyright Licenses" means all written agreements naming the
Borrower or a Guarantor as licensor or licensee (including, without
limitation, those listed in the Collateral Information Certificates),
granting any right under any Copyright, including, without limitation, the
grant of rights in all derivative works based upon any Copyright, and all
renewals and extensions thereof.
"Credit Documents" means this Agreement, the Notes, the
Contribution Agreement, the Guaranty, the Security Documents, the
Collateral Disclosure Certificates, any other agreement or document
evidencing, relating to or securing the Obligations of the types described
in clauses (a) and (b) of the definition thereof, and any other agreement,
document or instrument delivered from time to time in connection with this
Agreement, the Notes, the Contribution Agreement, the Guaranty, the
Security Documents or the Obligations of the types described in clauses (a)
and (b) of the definition thereof, as such documents and instruments may be
amended or supplemented from time to time.
"Current Derivative Exposure" means, as of any date of
determination, 100% of the aggregate ▇▇▇▇-to-market exposure then owing by
the Borrower or any Guarantor under Interest Rate Protection Agreements, as
calculated by the Agent on a monthly basis (or more frequently, in the
discretion of the Agent).
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"Debt" of any Person means at any date, without duplication, (a)
all obligations of such Person for borrowed money, (b) all payment
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (c) all obligations of such Person to pay the deferred
purchase price of property or services, except trade accounts payable and
accrued expenses arising in the ordinary course of business, (d) all
obligations of such Person as lessee under capital leases and the principal
component of Tax Retention Operating Leases, (e) all obligations of such
Person to reimburse any bank or other Person in respect of amounts payable
under a banker's acceptance, (f) all Redeemable Preferred Stock of such
Person (in the event such Person is a corporation), (g) all obligations of
such Person to reimburse any bank or other Person in respect of amounts
paid or undrawn amounts available to be paid under a letter of credit or
similar instrument, (h) all Debt of others secured by a Lien on any asset
of such Person, whether or not such Debt is assumed by such Person, (i) all
obligations of such Person with respect to interest rate protection
agreements, foreign currency exchange agreements or other hedging
arrangements, other than commodity hedging agreements entered into by such
Person as risk protection rather than as an investment (each valued as the
termination value thereof computed in accordance with a method approved by
the International Swap Dealers Association and agreed to by such Person in
the applicable agreement, if any), and (j) all Debt of others Guaranteed by
such Person.
"Default" means any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Default Rate" means, with respect to any of the Obligations, on
any day, the sum of the interest rate otherwise in effect plus 2%.
"Deposit Account" means "deposit account" as defined in the UCC
or the Uniform Commercial Code of any applicable jurisdiction and, in any
event, includes, without limitation, any demand, time, savings, passbook or
like account maintained with a depositary institution and all funds from
time to time credited to any account referred to in this definition.
"Deposit Account Control Agreement" means a Deposit Account
Control Agreement substantially in the form of EXHIBIT Q, with any changes
as may be acceptable to the Agent in its sole discretion, or a similar
control agreement in form and substance acceptable to the Agent, executed
and delivered by an Approved Depositary at which the Borrower or any
Guarantor maintains a Deposit Account.
"Direct Foreign Subsidiary" means any Foreign Subsidiary that is
owned directly by the Parent or by any Domestic Subsidiary.
"Dollars" or "$" means dollars in lawful currency of the United
States of America.
"Documents" means "documents" as such term is defined in the UCC,
all whether now owned or existing or hereafter acquired or arising, by or
in favor of, the Borrower or any Guarantor.
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"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in Charlotte, North Carolina or New
York, New York are authorized by law to close.
"Domestic Subsidiary" means any Subsidiary that is organized
under the laws of the United States of America or any state thereof or the
District of Columbia.
"Electronic Chattel Paper" means "electronic chattel paper" as
such term is defined in the UCC, all whether now existing or owned or
hereafter acquired or arising, by or in favor of, the Borrower or any
Guarantor.
"Eligible Accounts" means that portion of the Accounts of the
Borrower and the Guarantors consisting of trade accounts receivable
actually owing to the Borrower or a Guarantor by its Account Debtors, to
the extent not subject to any counterclaim, defense, setoff, retainage or
deduction (including, without limitation, chargebacks, accrued customer
rebates and other non-cash credits), provided, in each of the foregoing
cases, that each such Account is at all times subject to a duly perfected,
first priority security interest in favor of Agent, subject only to any
Permitted Encumbrances excluding, however, in any event any such Account:
(i) more than 90 days past invoice date (or 120 days past
invoice date in the case of Comcast Corporation and any others
specified in writing by the Agent from time to time in its
commercially reasonable judgment on a case by case basis) or more
than 60 days past due date (or in either case, such lesser number
of days which the Agent may establish by written notice from time
to time to the Borrower in its commercially reasonable judgment);
(ii) which is owing by any Subsidiary or other Affiliate, or
any employee thereof;
(iii) which is owing by any Account Debtor having 50% or
more in face value of its then existing Accounts with the
Borrower and the Guarantors ineligible under clause (i) above;
(iv) the assignment of which is subject to any requirements
set forth in the Assignment of Claims Act, unless the Borrower or
the relevant Guarantor, as applicable, duly assigns its rights to
payment thereof to the Agent pursuant to the Assignment of Claims
Act;
(v) which is owing by any Account Debtor whose Accounts, in
face amount, with the Borrower and the Guarantors exceed 20% (30%
as to Comcast Corporation) (or in each case such lesser
percentage which the Agent may establish by written notice from
time to time to the Borrower in its commercially reasonable
judgment) of all Accounts of the Borrower and the Guarantors then
outstanding, but only to the extent of such excess;
(vi) which arises from a sale to an Account Debtor with its
principal office, assets or place of business outside the United
States or any province in Canada, other than Quebec, unless: (A)
the sale is on letter of credit, guaranty or
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acceptance terms acceptable to the Agent in its commercially
reasonable judgment; or (B) the Agent otherwise notifies the
Borrower in writing that such account debtor's accounts will be
eligible pursuant to this clause (vi) (but subject to the other
eligibility criteria contained in this definition);
(vii) which arises from (a) the sale of goods which have not
been delivered and accepted by the Account Debtor (a "▇▇▇▇ and
hold" arrangement), or (b) services which have not been performed
by the Borrower or the Guarantors and accepted by the Account
Debtor;
(viii) which is owing by any Account Debtor which is the
subject (as debtor) of any voluntary or involuntary case or
proceeding under any bankruptcy, insolvency or other similar law
or as to which a trustee, receiver, liquidator, custodian or
other similar official has been appointed for it or for any
substantial part of its property;
(ix) which arises from the sale of any Inventory that is not
Eligible Inventory pursuant to clause (iii) of the proviso
contained in the definition of "Eligible Inventory";
(x) with respect to which the Agent determines in its
commercially reasonable judgment that facts, events or
circumstances exist such that collection of such Account is
insecure, or that payment thereof is doubtful or will be delayed
by reason of such Account Debtor's financial condition or that
the prospect of payment or performance by such Account Debtor is
or will be materially impaired;
(xi) with respect to which the Account Debtor's executive
offices are located in the State of New Jersey, Indiana or any
other state imposing similar conditions to the right of a
creditor to collect Accounts, unless (a) the Borrower or relevant
Guarantor, as applicable, has filed a notice of business
activities report, or such other similar report required by such
state, with the appropriate officials of such state for the then
current year, or (b) such Account Debtor has substantial assets
located, respectively, outside of the States of New Jersey,
Indiana or such other state, as the case may be;
(xii) which is owed by, billed to, or will be paid by an
Account Debtor located in the State of Alabama or any other state
the laws of which deny creditors access to its courts in the
absence of qualification to do business as a foreign corporation
in such state or in the absence of the filing of any required
reports with such state, unless the Borrower or relevant
Guarantor, as applicable, has qualified as a foreign corporation
authorized to do business in Alabama or such state or has filed
such required reports;
(xiii) which is subject to any Lien other than a Permitted
Encumbrance;
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(xiv) which consists of "▇▇▇▇▇▇▇▇ over cost" (items which
have been invoiced but for which costs incurred in connection
therewith have not been recognized);
(xv) which is owing by any Account Debtor with respect to
which the Borrower or any Guarantor has determined for any reason
not to continue selling goods to or performing services for on
open account;
(xvi) which is evidenced by Chattel Paper or an Instrument
of any kind, or has been reduced to judgment;
(xvii) with respect to which the Borrower or relevant
Guarantor, as applicable, has made an agreement with the Account
Debtor (a) for any deduction therefrom, except for discounts or
allowances which are made in the ordinary course of business for
prompt payment and which discounts or allowances are reflected in
the calculation of the face amount of each invoice related to
such Account, but only to the extent of such deduction, or (b) to
extend the time of payment thereof beyond the period set forth in
clause (i) in this definition;
(xviii) which arises from a retail sale of goods to a Person
who is purchasing the same primarily for personal, family or
household purposes;
(xix) which represents a progress billing or percentage of
completion arrangement (unless the Agent, in the exercise of its
commercially reasonable judgment, after the Borrower's request,
permits the same to not be excluded hereunder) or a retainage; or
(xx) which has otherwise been determined by the Agent in its
commercially reasonable judgment not to be eligible for purposes
hereof, whether or not satisfying the criteria set forth above,
as such criteria may be modified by the Agent in its commercially
reasonable judgment upon notice to the Borrower.
"Eligible Inventory" means the gross dollar value of Inventory of
the Borrower and the Guarantors consisting of: (a) raw materials; and (b)
finished goods, subject to no further processing and held for sale in the
ordinary course of business to customers and not Affiliates of the
Borrower; provided, in each of the foregoing cases, that such Inventory:
(xxi) is at all times subject to a duly perfected, first
priority security interest in favor of Agent, subject only to any
Permitted Encumbrances;
(xxii) is in good and saleable condition;
(xxiii) is not on consignment from or subject to any
guaranteed sale, sale-or-return, sale-or-approval, or repurchase
agreement with any supplier;
(xxiv) does not constitute in-transit goods or returned
goods;
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(xxv) does not constitute obsolete, repossessed, damaged or
slow-moving (older than 360 days) goods;
(xxvi) conforms in all respects to the warranties and
representations with respect to Inventory set forth herein;
(xxvii) is not subject to a negotiable document of title
(unless issued or endorsed, and delivered to Agent);
(xxviii) is not subject to any license or other agreement
that limits or restricts the Borrower's, any Guarantor's or the
Agent's right to sell or otherwise dispose of such Inventory;
(xxix) is located in the United States on premises owned by
the Borrower or a Guarantor or with respect to which the Agent
holds a Waiver Agreement and is a Collateral Location;
(xxx) meets all standards imposed by any governmental
authority having jurisdiction; and
(xxxi) which has not otherwise been determined by the Agent
in its commercially reasonable judgment to be ineligible for
purposes hereof, whether or not satisfying the criteria set forth
above, as such criteria may be modified by the Agent in its
commercially reasonable judgment upon notice to the Borrower.
"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction or
authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal prerequisites for
conducting the business of the Parent or any Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means all judgments, decrees
or orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent, or written agreements
with an Environmental Authority or other entity arising from or in any way
associated with any Environmental Requirement.
"Environmental Liabilities" means any liabilities, whether
accrued, contingent or otherwise, arising from and in any way associated
with any Environmental Requirements.
"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged
noncompliance with or liability under any Environmental Requirement,
including without limitation any complaints, citations, demands or requests
from any Environmental Authority or from any other person or entity for
correction of any violation of any Environmental Requirement or any
investigations concerning any violation of any Environmental Requirement.
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"Environmental Proceedings" means any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
"Environmental Releases" means releases as defined in CERCLA or
under any other Environmental Requirements.
"Environmental Requirements" means any legal requirement relating
to health or the environment and applicable to the Parent or any Subsidiary
or the Aggregate Real Properties, including but not limited to any such
requirement under CERCLA or similar state legislation and all federal,
state and local laws, ordinances, regulations, orders, writs, decrees and
common law relating to health or the environment.
"Equipment" means all "equipment," as such term is defined in the
UCC, wherever located and, in any event, includes, without limitation, all
machinery and equipment, including, without limitation, all processing
equipment, conveyors, machine tools, data processing and computer
equipment, including, without limitation, all embedded software and
peripheral equipment and all engineering, processing and manufacturing
equipment, office machinery, furniture, materials handling equipment,
tools, attachments, accessories, automotive equipment, trailers, trucks,
forklifts, molds, dies, stamps, and other equipment of every kind and
nature, trade fixtures and fixtures not forming a part of real property,
together with all additions and accessions thereto, replacements therefor,
all parts therefor, all substitutes for any of the foregoing, fuel
therefor, and all manuals, drawings, instructions, warranties and rights
with respect thereto, and all products and proceeds thereof and
condemnation awards and insurance proceeds with respect thereto, all
whether now owned or existing or hereafter acquired or arising, by or in
favor of, the Borrower or any Guarantor, but excluding all Excluded
Equipment (it being understood for the sake of clarity that all Vehicles of
the Borrower or any Guarantor constitute Excluded Equipment,
notwithstanding that the description of "Equipment" set forth in this
definition refers to certain types of property included within the meaning
of the term "Vehicles").
"Equity Interests" means, with respect to any Person, (a) all
shares, interests, participations, rights or other equivalents (however
designated, whether voting or non-voting) of or interests in corporate or
capital stock, including without limitation, shares of preferred or
preference stock, of such Person, (b) all partnership interests (whether
general or limited) of such Person, (c) all membership interests or limited
liability company interests in such Person, (d) all other equity or
ownership interests in such Person of any other type and (e) all warrants,
rights or options to purchase any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor law. Any reference to
any provision of ERISA shall also be deemed to be a reference to any
successor provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on
which dealings in Dollar deposits are carried out in the London interbank
market.
CONFIDENTIAL
"Euro-Dollar Loan" means a Loan which bears or is to bear
interest at a rate based upon the Adjusted London Interbank Offered Rate,
and to be made as a Euro-Dollar Loan pursuant to the applicable Notice of
Borrowing or Notice of Continuation or Conversion.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
SECTION 2.06(c).
"Event of Default" has the meaning set forth in SECTION 6.01.
"Excess Borrowing Availability" means, at any time, the amount
(if any) by which the aggregate amount of the Borrowing Base exceeds the
then outstanding Revolving Loans.
"Excluded Equipment" means (a) any Equipment subject to a
Purchase Money Lien as to which the purchase money creditor holding such
Lien prohibits other Liens thereon (of the type created in favor of the
Agent under SECTION 3.01 hereof) without its prior consent, unless and
until either (i) such creditor grants such consent or (ii) the Debt secured
by such Lien has been fully paid and satisfied; and (b) any Equipment with
respect to which the rights of possession and use of the Borrower or any
Guarantor are created pursuant to a lease which does not create a security
interest, unless and until such time (if any) as such Borrower acquires
title to such Equipment from the lessor or the lessor abandons its rights
and claims thereto and (c) Vehicles.
"Executive Office" means the chief executive office address of
the Parent and the Borrower designated as such in the Collateral Disclosure
Certificates.
"Existing Letter of Credit" means a standby letter of credit, LC
Number - SM421406C, in the amount of (euro)96,000, issued by Wachovia to
Auna Operadores de Telecomunicaciones, Barcelona, Spain, expiring April 30,
2004, and drawable upon the occurrence of certain breaches under a product
supply arrangement, which shall for all purposes under this Agreement and
the other Credit Documents be deemed to have been issued as a Letter of
Credit pursuant hereto.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%) equal to
the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers on such day, as published by the Federal Reserve Bank of New York
on the Domestic Business Day next succeeding such day, provided that (a) if
the day for which such rate is to be determined is not a Domestic Business
Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (b) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the
average rate charged to the Agent on such day on such transactions, as
determined in good faith by the Agent.
"Fee Letter" means that certain letter agreement, dated as of
November 25, 2002 among the Parent and the Agent and the Arranger relating
to certain fees from time to time payable by the Borrower to the Agent and
the Arranger, together with all amendments and supplements thereto.
CONFIDENTIAL
"Fiscal Month" means any fiscal month of the Parent.
"Fiscal Quarter" means any fiscal quarter of the Parent.
"Fiscal Year" means any fiscal year of the Parent.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (i) Consolidated EBITDA less the aggregate
amount of all capital expenditures of the Parent and its Consolidated
Subsidiaries less Consolidated Cash Taxes, in each case for the period of
twelve fiscal months ended on such date, to (ii) Consolidated Fixed Charges
for such period.
"Fixtures" means all "fixtures" as such term is defined in the
UCC, all whether now owned or existing or hereafter acquired or arising, by
or in favor of, the Borrower or any Guarantor.
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"ForEx Contract" means each "spot" or "forward" foreign currency
exchange agreement entered into from time to time between the Borrower and
any Lender.
"ForEx Obligations" means any and all settlement obligations,
fees, charges, liabilities and other obligations owed to any Lender under
all ForEx Contracts.
"Funded Debt/EBITDA Ratio means, as of any date of determination,
the ratio of (i) Consolidated Net Funded Debt as of such date to (ii)
Consolidated EBITDA for the period of twelve fiscal months ended on such
date.
"Furakawa" means, collectively, The Furakawa Electric Company,
Ltd., a corporation organized under the laws of Japan, together with its
Subsidiaries and their respective successors and assigns.
"GAAP" means generally accepted accounting principles in the
United States of America applied on a basis consistent with those which, in
accordance with SECTION 1.02, are to be used in making the calculations for
purposes of determining compliance with the terms of this Agreement.
"General Intangibles" means all of the Borrower's and each
Guarantor's "general intangibles" as such term is defined in the UCC and,
in any event, includes, without limitation, (a) all tax refunds, claims for
tax refunds, and tax credits, (b) all permits, licenses, approvals,
authorizations, consents, variances, and certifications of any governmental
authority, (c) all claims, causes of action, and choses in action, (d) all
property, casualty, liability, and other insurance of any kind or
character, and all insurance claims and insurance refund claims, (e) all
payment intangibles, (f) all lists, books, records, recorded knowledge,
ledgers, files (whether in printed form or stored electronically), designs,
blueprints, data, specifications, engineering reports, manuals, computer
records, computer programs and computer software (including source codes),
(g) all internet domain names and websites and related licenses and
agreements, (h) all Intellectual Property and (i) all contracts,
agreements, instruments and indentures in any form, and portions thereof,
to which the Borrower or any Guarantor is a party or under which the
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Borrower or any Guarantor has any right, title or interest or to which the
Borrower or any Guarantor or any property of the Borrower or any Guarantor
is subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of the
Borrower or any Guarantor to receive moneys due and to become due to it
thereunder or in connection therewith, (ii) all rights of the Borrower or
any Guarantor to damages arising thereunder and (iii) all rights of the
Borrower or any Guarantor to perform and to exercise all remedies
thereunder; but excluding for purposes of this clause (i) rights under any
contract, agreement, instrument or indenture and under any Intellectual
Property that by the terms thereof, or under applicable law, cannot be
assigned or a security interest granted therein in the manner contemplated
by this Agreement unless consent from the relevant party or parties has
been obtained and under the terms of which any such assignment or grant of
a security interest therein in the absence of such consent would, or could,
result in the termination thereof, but only to the extent that (y) such
rights are subject to such contractual or legal restriction and (z) such
restriction is not, or could not be, rendered ineffective pursuant to the
UCC of any relevant jurisdiction or any other applicable law or principles
of equity.
"Goods" means all "goods" as defined in the UCC, wherever
located, including, without limitation, embedded software to the extent
included in "goods" as defined in the Code, all whether now owned or
existing or hereafter acquired or arising, by or in favor of, the Borrower
or any Guarantor.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or
other obligation of any other Person and, without limiting the generality
of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (a) to secure, purchase or pay (or advance or
supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to provide
collateral security, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (b) entered into for the purpose of assuring in
any other manner the obligee of such Debt or other obligation of the
payment thereof or to protect such obligee against loss in respect thereof
(in whole or in part), provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantors" means (i) the Parent, (ii) the Initial Subsidiary
Guarantors and (iii) each other Material Domestic Subsidiary that becomes a
Subsidiary Guarantor pursuant to SECTION 5.15.
"Guaranty" means the Guaranty, substantially in the form of
EXHIBIT S, to be executed by the Parent and the Subsidiary Guarantors,
unconditionally and jointly and severally Guaranteeing payment of the
Loans, the Notes and all other obligations of the Borrower to the Agent and
the Lenders hereunder, including without limitation all principal,
interest, fees, costs, and compensation and indemnification amounts
provided for hereunder.
"Hazardous Materials" includes, without limitation, (a) solid or
hazardous waste, as defined in the Resource Conservation and Recovery Act
of 1980, 42 U.S.C. ss. 6901 et seq. and its implementing regulations and
amendments, or in any applicable state or local law or
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regulation, (b) "hazardous substance", "pollutant", or "contaminant" as
defined in CERCLA, or in any applicable state or local law or regulation,
(c) gasoline, or any other petroleum product or by-product, including,
crude oil or any fraction thereof, (d) toxic substances, as defined in the
Toxic Substances Control Act of 1976, or in any applicable state or local
law or regulation and (e) insecticides, fungicides, or rodenticides, as
defined in the Federal Insecticide, Fungicide, and Rodenticide Act of 1975,
or in any applicable state or local law or regulation, as each such Act,
statute or regulation may be amended from time to time.
"Headquarters Facility" means the headquarters facility and
adjacent parking lot in Hickory, North Carolina.
"Health-Care-Insurance Receivables" means "health-care-insurance
receivables" as defined in the UCC, wherever located, all whether now owned
or existing or hereafter acquired or arising, by or in favor of, the
Borrower or any Guarantor.
"Initial Subsidiary Guarantors" means CommScope Optical
Technologies, Inc., a Delaware corporation, CommScope International, Inc.,
a Delaware corporation, CommScope International Holdings, LLC, a Delaware
limited liability company, CommScope Properties, LLC, a Nevada limited
liability company, Vextra Technologies, LLC, a North Carolina limited
liability company, and CommScope Netherlands GP, LLC, a Delaware limited
liability company.
"Instruments" means all "instruments" as such term is defined in
the UCC, wherever located, and, in any event, includes, without limitation,
all promissory notes and other evidences of indebtedness, other than
instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper, all whether now owned or existing or hereafter
acquired or arising, by or in favor of, the Borrower or any Guarantor; but
excluding in any event any such instrument that is excluded from the
definition of "General Intangibles" under the provisions of such
definition.
"Intellectual Property" means the collective reference to all of
the Borrower's and each Guarantor's rights, priorities and privileges
relating to intellectual property, whether arising under United States,
multinational or foreign laws or otherwise, including, without limitation,
the Copyrights, the Copyright Licenses, the Patents, the Patent Licenses,
the Trademarks and the Trademark Licenses, and all rights to ▇▇▇ at law or
in equity for any infringement or other impairment thereof, including,
without limitation, the right to receive all proceeds and damages
therefrom.
"Interest Period" means, with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending
on the numerically corresponding day in the first, second, third or sixth
month thereafter, as the Borrower may elect in the applicable Notice of
Borrowing or Notice of Continuation or Conversion; provided that:
(xxxii) any Interest Period (subject to paragraph (iii)
below) which would otherwise end on a day which is not a
Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-
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Dollar Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(xxxiii) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall, subject to
paragraph (iii) below, end on the last Euro-Dollar Business Day
of the appropriate subsequent calendar month; and
(xxxiv) no Interest Period may be selected which begins
before the Termination Date and would otherwise end after the
Termination Date.
"Interest Rate Basis" means the Base Rate or the Adjusted London
Interbank Offered Rate, as appropriate.
"Interest Rate Protection Agreement" means an interest rate
hedging or protection agreement or any other interest rate derivative
product entered into by and between the Borrower or any Guarantor and any
of the Lenders, or any Affiliate of any Lender, together with all exhibits,
schedules, extensions, renewals, amendments, substitutions and replacements
thereto and thereof.
"Inventory" means "inventory" as such term is defined in the UCC
and includes, without limitation, wherever located, all goods held for sale
or lease or furnished or to be furnished under contracts of service, all
goods held for display or demonstration, goods on lease or consignment,
spare parts, repair parts, returned and repossessed goods, all raw
materials, work-in-process, finished goods and supplies used or consumed in
the Borrower's or any Guarantor's business, all whether now owned or
existing or hereafter acquired or arising, by or in favor of, the Borrower
or any Guarantor.
"Investment" means any investment in any Person, whether by means
of purchase or acquisition of obligations or securities or all or
substantially all of the assets of such Person or of a division or
particular line of business of such Person (including, without limitation,
interest rate protection, foreign currency or other hedging arrangements to
be held by such Person as an investment), capital contribution to such
Person, loan or advance to such Person, making of a time deposit with such
Person, Guarantee or assumption of any obligation of such Person or
otherwise.
"Investment Property" means all "investment property" as such
term is defined in the UCC and, in any event, includes, without limitation,
all Pledged Interests and all Pledged Notes.
"LC Issuer" means Wachovia or any other Lender approved by the
Agent, as issuer of the Letters or Credit.
"Lender" means each bank or other financial institution listed on
the signature pages hereof as having a Commitment, and its successors and
assigns.
CONFIDENTIAL
"Lending Office" means, as to each Lender, its office located at
its address set forth on the signature pages hereof (or identified on the
signature pages hereof as its Lending Office) or such other office as such
Lender may hereafter designate as its Lending Office by notice to the
Borrower and the Agent.
"Letter(s) of Credit" means the Existing Letter of Credit and any
standby or documentary letter of credit issued by the LC Issuer for the
account of the Borrower pursuant to ARTICLE 2.
"Letter of Credit Application Agreement" means, with respect to a
Letter of Credit, such form of application therefor (whether in a single or
several documents) as the LC Issuer may employ in the ordinary course of
business for its own account, whether or not providing for collateral
security, with such modifications thereto as may by agreed upon by the LC
Issuer and the Borrower and are not materially adverse to the interests of
the Lenders; provided, however, that in the event of any conflict between
the terms of any Letter of Credit Application Agreement and this Agreement,
the terms of this Agreement shall control.
"Letter of Credit Commitment Fee" shall have the meaning ascribed
to it in SECTION 2.22.
"Letter of Credit Fronting Fee" shall have the meaning ascribed
to it in SECTION 2.22.
"Letter of Credit Obligations" means, at any particular time, the
sum of (a) the Reimbursement Obligations at such time, (b) the aggregate
maximum amount available for drawing under the Letters of Credit at such
time and (c) the aggregate maximum amount available for drawing under
Letters of Credit the issuance of which has been authorized by the LC
Issuer but which have not yet been issued.
"Letter of Credit Rights" means "letter-of-credit rights" as such
term is defined in UCC, including, without limitation, rights to payment or
performance under a letter of credit, whether or not the beneficiary
thereof has demanded or is entitled to demand payment or performance, all
whether now owned or existing or hereafter acquired or arising, by or in
favor of, the Borrower or any Guarantor.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest,
security title, preferential arrangement which has the practical effect of
constituting a security interest, encumbrance, or servitude of any kind in
respect of such asset to secure or assure payment of a Debt or a Guarantee,
whether by consensual agreement or by operation of statute or other law, or
by any agreement, contingent or otherwise, to provide any of the foregoing.
For the purposes of this Agreement, the Borrower or any Subsidiary shall be
deemed to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to
such asset.
"Loan" means a Base Rate Loan, Euro-Dollar Loan, Base Rate Loan,
Euro-Dollar Loan, Revolving Loan or Settlement Loan, and "Loans" means Base
Rate Loans, Euro-Dollar
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Loans, Base Rate Loans, Euro-Dollar Loans, Revolving Loans or Settlement
Loans, or any or all of them, as the context shall require.
"London Interbank Offered Rate" has the meaning set forth in
SECTION 2.06(c).
"Margin Stock" means "margin stock" as defined in Regulations T,
U or X.
"Material Adverse Effect" means, with respect to any event, act,
condition or occurrence of whatever nature (including, without limitation,
any adverse determination, or claim or contest by the Borrower or any
Guarantor demanding the same, in any litigation, arbitration, or
governmental investigation or proceeding), whether singly or in conjunction
with any other event or events, act or acts, condition or conditions,
occurrence or occurrences, whether or not related, a material adverse
change in, or a material adverse effect upon, any of (a) the financial
condition, operations, business or properties of the Parent and the
Subsidiaries, taken as a whole, (b) the rights and remedies of the Agent or
the Lenders under the Credit Documents, the Agent's security interest and
Lien against the Collateral, or the ability of any of the Borrower or any
Guarantor to perform its obligations with respect to the Obligations or
under the Credit Documents to which it is a party (including, without
limitation, the repudiation, revocation or any attempt to do the same by
any the Borrower or any Guarantor), as applicable, or (c) the legality,
validity or enforceability of any Credit Document.
"Material Contract" means (a) those contracts, leases,
instruments, guaranties, licenses, agreements, and other arrangements
listed in the Collateral Disclosure Certificates and (b) all other
contracts, leases, instruments, guaranties, licenses, agreements, and other
arrangements to which the Borrower or any Guarantor is, from time to time,
a party, the breach, nonperformance, cancellation or failure to renew by
any party thereto could reasonably be expected to have a Material Adverse
Effect.
"Material Domestic Subsidiary" means CommScope Optical and any
other Domestic Subsidiary that is a Material Subsidiary.
"Material Foreign Direct Subsidiary" means any Foreign Subsidiary
that is a Material Subsidiary and is owned directly by the Parent, the
Borrower and/or any other Domestic Subsidiary.
"Material Subsidiary" means any Subsidiary of the Parent, the
Borrower or any Subsidiary thereof that (a) has assets which constitute
more than 10% of the consolidated total assets of the Parent and its
Consolidated Subsidiaries at the end of the most recent Fiscal Quarter, (b)
contributed more than 10% of Consolidated Net Income for the 4 most recent
Fiscal Quarters then ended (or, with respect to any Subsidiary which
existed during the entire 4 Fiscal Quarter period but was acquired by the
Parent or any other Subsidiary during such period, which would have
contributed more than 10% of Consolidated Net Income for such period had it
been a Subsidiary for the entire period, as determined on a pro forma basis
in accordance with GAAP), or (c) is listed on Schedule 1.01.
"Mortgage" means any one, or more, or all, as the context shall
require, of a mortgage, deed to secure debt or deed of trust, as applicable
in the relevant jurisdiction substantially in the form of EXHIBIT O (which
is a deed of trust suitable for North Carolina, but
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modified as necessary and appropriate pursuant to the laws of the
jurisdiction in which such Real Property is located), conveying a first
priority security title to and Lien on the Real Properties to the Agent (or
to a trustee for the Agent, with respect to any real property in the State
of North Carolina), for the benefit of the Lenders and Wachovia, subject
only to the Permitted Encumbrances applicable thereto, as security for
payment of the Obligations, together with all amendments and supplements
thereto.
"Moody's" means ▇▇▇▇▇'▇ Investor Service, Inc.
"Multiemployer Plan" shall have the meaning set forth in SECTION
4001(a)(3) of ERISA.
"Net Casualty/Insurance Proceeds", when used with respect to any
Condemnation Awards or insurance proceeds allocable to the Collateral,
means the gross proceeds from any Casualty or Condemnation remaining after
payment of all expenses (including attorneys' fees) incurred in the
collection of such gross proceeds.
"Net Income" means, as applied to any Person for any relevant
fiscal period, the aggregate amount of net income of such Person, after
taxes, for such period, as determined in accordance with GAAP.
"Non-Excluded Taxes" has the meaning set forth in SECTION
2.12(c).
"Non-U.S. Lender" has the meaning set forth in SECTION 2.12(d).
"Notes" means each of the Revolving Loan Notes or the Settlement
Loan Note, or any or all of them, as the context shall require, together
with all amendments, consolidations, modifications, renewals, and
supplements thereto.
"Notice of Borrowing" has the meaning set forth in SECTION 2.02.
"Notice of Continuation or Conversion" has the meaning set forth
in SECTION 2.03.
"Obligations" means all Debts, indebtedness, liabilities,
covenants, duties and other obligations of the Borrower: (a) to the Agent
or the Lenders included or arising from time to time under this Agreement
or any other Credit Document, whether evidenced by any note or other
writing, whether arising from the extension of credit, opening of a letter
of credit, acceptance or loan guaranty, including, without limitation,
principal, interest, fees, costs, attorney's fees and indemnification
amounts and any and all extensions or renewals thereof in whole or in part,
direct or indirect, absolute or contingent, due or to become due, primary
or secondary, or joint or several; (b) to the Agent or the LC Issuer, with
respect to all Letter of Credit Obligations and all other obligations
arising in connection with the issuance of any Letter of Credit; (c) to any
Lender or Affiliate thereof arising under any Interest Rate Protection
Agreement or ForEx Obligations with any such Lender or Affiliate,
including, without limitation, any premature termination or breakage or
other costs with respect thereto; and (d) to Wachovia or any other Lender
and their respective Affiliates, arising in connection with any cash
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management services or related banking services and functions provided to
the Borrower or any Guarantor in connection with the conduct of such
Borrower's or Guarantor's business.
"Officer's Certificate" has the meaning set forth in SECTION
9.01(f).
"OFS BrightWave" means OFS BrightWave, LLC, a Delaware limited
liability company, and its successors and assigns.
"Overadvance Loan" has the meaning set forth in SECTION 2.01(c).
"Parent" means CommScope, Inc., a Delaware corporation, and its
successors and permitted assigns.
"Participant" has the meaning set forth in SECTION 10.08(b).
"Patents" means (a) all letters patent including, without
limitation, all utility patents, design patents, industrial designs and
utility model registrations of the United States or any other country, or
any political subdivision thereof and all reissues and extensions thereof,
including, without limitation, those listed in the Collateral Disclosure
Certificates, (b) all applications for letters patent of the United States
or any other country and all divisions, continuations and
continuations-in-part thereof, including, without limitation, those listed
in the Collateral Disclosure Certificates, and (c) all rights to obtain any
reissues, reexaminations, or extensions of the foregoing.
"Patent Licenses" means all agreements, whether written or oral,
providing for the grant by or to a Borrower of any right to make, use,
sell, offer to sell, or import any invention covered in whole or in part by
a Patent, including, without limitation, those listed in the Collateral
Disclosure Certificates, and all extensions and renewals thereof.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" means, (a) as to the Collateral granted
pursuant to SECTION 3.01, the encumbrances set forth on SCHEDULE 3.01(a),
(b) as to each parcel of the Real Properties, the encumbrances expressly
permitted by the Mortgage with respect to such parcel of the Real
Properties, (c) Liens in favor of the Agent or the Lenders pursuant to the
Credit Documents and (d) as to any assets, the types of encumbrances
applicable thereto and permitted pursuant to SECTION 5.17.
"Person" means an individual, a corporation, a limited liability
company, a partnership, an unincorporated association, a trust or any other
entity or organization, including, but not limited to, a government or
political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan which
is covered by Title IV of ERISA or subject to the minimum funding standards
under SECTION 412 of the Code and is either (a) maintained by a member of
the Controlled Group for employees of any member of the Controlled Group or
(b) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to
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which a member of the Controlled Group is then making or accruing an
obligation to make contributions or has within the preceding 5 plan years
made contributions.
"Pledge Agreement" means the Stock Pledge Agreement dated as of
even date herewith, substantially in the form of EXHIBIT N, executed by the
Borrower (as to its directly owned Domestic Subsidiaries and Material
Direct Foreign Subsidiaries) and the Parent (as to the Borrower) (and to be
joined in pursuant to SECTION 5.15 by any other Guarantor that after the
Closing Date acquires a Domestic Subsidiary or a Material Foreign Direct
Subsidiary) in favor of the Agent.
"Pledged Interests" means all Equity Interests of or in any
Person that may be issued or granted to, or held or owned by, the Borrower
or any Guarantor, including, without limitation, the Equity Interests
described in the Collateral Disclosure Certificates, and all certificates
representing such Equity Interests, limited, however, as to Foreign Direct
Subsidiaries, to 65% of such Equity Interests.
"Pledged Notes" means all Instruments listed in the Collateral
Disclosure Certificates and all other Instruments issued to or held by the
Borrower or any Guarantor.
"Pledged Stock" means the capital stock described in and pledged
pursuant to the Pledge Agreement, which constitutes Investment Property in
which a security interest is granted hereunder.
"Prime Rate" refers to that interest rate so denominated and set
by Wachovia from time to time as an interest rate basis for borrowings. The
Prime Rate is but one of several interest rate bases used by Wachovia.
Wachovia lends at interest rates above and below the Prime Rate.
"Prior Credit Agreements" means (i) the Credit Agreement dated as
of July 23, 1997, as amended, between the Borrower, the Banks party
thereto, JPMorgan Chase Bank (formerly The Chase Manhattan Bank) as
Administrative Agent for the Banks, and the financial institutions named
therein as co-agents for the Banks, and (ii) the Credit Agreement dated as
of February 26, 1999, as amended, between the Borrower and Wachovia (as
successor by merger to Wachovia Bank, N.A.).
"Purchase Money Lien" means any Lien (including a negative pledge
arrangement) granted by the Borrower or any Guarantor from time to time to
vendors or financiers of equipment to secure the payment of the purchase
price thereof so long as (a) such Liens extend only to the specific
equipment so purchased, (b) secure only such deferred payment obligation
and related interest, fees and charges and no other Debt, and (c) are
promptly released upon the payment in full of such purchase price and
related interest, fees and charges.
"Real Properties" means the real property owned or leased by the
Borrower or a Guarantor and located in: Catawba, North Carolina, Claremont,
North Carolina, Newton, North Carolina, Statesville, North Carolina, but
excluding the Headquarters Facility, the owned real property located in
Kings Mountain, North Carolina and Scottsboro, Alabama and the leased real
property located in Sparks, Nevada; provided, however, that if at any time
Excess Borrowing Availability is less than $30,000,000 (and regardless of
subsequent changes in Excess Borrowing
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Availability above $30,000,000), Agent (at the direction of the Required
Lenders, in their reasonable credit judgment), may notify the Borrower that
the real property located in Scottsboro, Alabama be included as a Real
Property, and promptly upon receipt of such notice, such property shall
become a Real Property hereunder and the Borrower shall promptly commence
and diligently pursue the execution and delivery of a Mortgage, and obtain
and deliver the Real Property Documentation requested by the Agent, with
respect thereto.
"Real Property Documentation" means the following as to each
parcel of the Real Properties (except that the Agent may in its discretion
waive or suspend the requirement for delivery of certain of the Real
Property Documentation for any of the Real Properties, unless and until it
notifies the Borrower or the relevant Guarantor that such requirement shall
be imposed (which notice it may give in its sole discretion and shall give
if requested by the Required Lenders, and the right to give such notice and
impose such requirement, whether or not a Default or Event of Default is in
existence, is expressly reserved):
(xxxv) an owner's/lessee's affidavit for each parcel or
tract of such Real Property;
(xxxvi) mortgagee title insurance binders and policies for
each tract or parcel of such Real Property;
(xxxvii) such consents, acknowledgments, intercreditor or
attornment and subordination agreements as the Agent may require
from any Third Parties with respect to any portion of such Real
Property;
(xxxviii) a current survey of each parcel or tract of such
Real Property, unless mortgagee title company deletes the general
survey exception based on affidavit from the Borrower or
Guarantor;
(xxxix) a certificate as to the insurance required by the
related Mortgage, to the extent not furnished pursuant to SECTION
5.08;
(xl) a report of a licensed engineer or geologist detailing
an environmental inspection of such Real Property;
(xli) an indemnification agreement regarding hazardous
materials for such Real Property;
(xlii) if a Default has occurred or the Agent or the
Required Lenders determine in good faith that it is or may be
required by applicable banking or other regulatory law or
regulations, an appraisal of such Real Property, prepared by an
appraiser satisfactory to the Agent and engaged by and on behalf
of the Agent and the Lenders; and
(xliii) any revenue ruling or similar assurance from the
department or revenue or taxation requested by the Agent with
respect to any stamp, intangible or other taxes payable in
connection with the filing for record of any of the Mortgages.
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"Redeemable Preferred Stock" of any Person means any preferred
stock issued by such Person which is at any time prior to the Termination
Date either (a) mandatorily redeemable (by sinking fund or similar payments
or otherwise) or (b) redeemable at the option of the holder thereof.
"Refunding Loan" means a new Syndicated Loan made on the day on
which (a) an outstanding Syndicated Loan is maturing as a refinancing
thereof, or (b) a Base Rate Borrowing is being converted to a Euro-Dollar
Borrowing, if and to the extent that the proceeds thereof are used entirely
for the purpose of refinancing such maturing Loan or Loan being converted,
excluding any difference between the amount of such maturing Loan or Loan
being converted and any greater amount being borrowed on such day and
actually either being made available to the Borrower pursuant to SECTION
2.02(c) or remitted to the Agent as provided in SECTION 2.12, in each case
as contemplated in SECTION 2.02(d).
"Register" has the meaning set forth in SECTION 10.08(c).
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Reimbursement Obligations" means the reimbursement or repayment
obligations of the Borrower to the LC Issuer pursuant to SECTION 2.20 with
respect to Letters of Credit.
"Related Fund" means, with respect to any Lender that is a fund
that invests in bank loans, any other fund that invests in bank loans and
is advised or managed by the same investment advisor as such Lender.
"Required Lenders" means at any time Lenders holding Commitment
Percentages equal to at least 51% of the aggregate amount of the
Commitments or, if the Commitments are no longer in effect, Lenders holding
at least 51% of the aggregate outstanding principal amount of the
Syndicated Loans; provided, however, that (i) such calculation shall be
made without including the Commitment of or principal amount of Revolving
Loan Notes held by any Lender which is in default with respect to its
obligations to the Agent, the Borrower or any Lender and (ii) at any time
during which there are 5 or more Lenders party hereto, Required Lenders
shall be not less than any 3 Lenders. As of the Closing Date, the Lenders
have the following Commitment Percentages: (a) Wachovia: 35%; (b) PNC Bank,
National Association, 25%; (c) BNP Paribas, 20%; (d) Branch Banking and
Trust Company, 10%; and (e) CIBC, Inc., 10%.
CONFIDENTIAL
"Restricted Payment" means (a) any dividend or other distribution
on any shares of the Parent's Capital Stock or Redeemable Preferred Stock
(except dividends payable solely in shares of its Capital Stock or
Redeemable Preferred Stock); (b) any payment on account of the purchase,
redemption, retirement, defeasance, or other acquisition of or sinking fund
for (i) any shares of the Parent's Capital Stock or Redeemable Preferred
Stock (except shares acquired upon the conversion thereof into other shares
of its Capital Stock or Redeemable Preferred Stock), or (ii) any option,
capital appreciation rights, stock appreciation rights, warrant or other
right to acquire shares of the Parent's Capital Stock or Redeemable
Preferred Stock; or (c) any payment prior to the scheduled maturity of any
principal of any Subordinated Debt of the Borrower or any Guarantor.
"Revolving Loan" means the revolving loans (and Settlement Loans)
to be made by all of the Lenders in accordance with SECTION 2.01(a).
"Revolving Loan Notes" means the promissory notes of the Borrower
substantially in the form of EXHIBIT A-1 evidencing the obligation of the
Borrower to repay Revolving Loans (other than Settlement Loans), together
with all amendments, consolidations, modifications, renewals and
supplements thereto.
"Securities Account Control Agreement" means a Securities Account
Control Agreement substantially in the form of EXHIBIT R, with any changes
as may be acceptable to the Agent in its sole discretion, or a similar
control agreement in form and substance acceptable to the Agent, executed
and delivered by an Approved Securities Intermediary at which the Borrower
or any Guarantor maintains a securities account.
"Security Documents" means this Agreement, all Deposit Account
Control Agreements, all Securities Account Control Agreements, the Pledge
Agreement, the Mortgages, and the Waiver Agreements, and any and all other
documents executed or delivered by the Borrower or any Guarantor to Agent
for purposes of the creating, attachment, or perfection of the Agent's
security interest in and to any of the Collateral, the Real Properties, or
the Pledged Stock.
"Senior Officer" means any of the following officers of the
Borrower or any Guarantor, regardless of actual title: Chief Executive
Officer; Chief Operating Officer; Chief Financial Officer; Controller; and
Treasurer.
"Settlement Date" has the meaning set forth in SECTION
2.01(b)(ii).
"Settlement Loan" means a Loan made by Wachovia pursuant to
SECTION 2.01(b), which must be a Base Rate Loan.
"Settlement Loan Note" means the promissory note of the Borrower,
substantially in the form of EXHIBIT A-2, evidencing the obligation of the
Borrower to repay the Settlement Loans, together with all amendments,
consolidations, modifications, renewals and supplements thereto.
"S&P" means Standard & Poor's Ratings Group, a division of
▇▇▇▇▇▇-▇▇▇▇, Inc.
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"Stockholders' Equity" means, at any time, the shareholders'
equity of the Parent and the Subsidiaries, as set forth or reflected on the
most recent consolidated balance sheet of the Parent and the Subsidiaries
prepared in accordance with GAAP, but excluding any Redeemable Preferred
Stock of the Parent or any of the Subsidiaries. Shareholders' equity
generally would include, but not be limited to (a) the par or stated value
of all outstanding Capital Stock, (b) capital surplus, (c) retained
earnings, and (d) various deductions such as (i) purchases of treasury
stock, (ii) valuation allowances, (iii) receivables due from an employee
stock ownership plan, (iv) employee stock ownership plan debt guarantees,
and (v) translation adjustments for foreign currency transactions.
"Subordinated Debt" means any Debt, which is unsecured, of the
Borrower or any Guarantor to any Person which, by written agreement, has
been subordinated in right of payment and claim, to the rights and claims
of the Agent, the Lenders and Wachovia and the LC Issuer in respect of the
Obligations, on terms and conditions reasonably satisfactory to the
Required Lenders.
"Subsidiary" means, with respect to any Person, any corporation
or other entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by such Person. When used without reference to a parent
entity, the term "Subsidiary" shall mean a Subsidiary of the Borrower.
"Subsidiary Guarantor" means the Initial Subsidiary Guarantors
and each Material Domestic Subsidiary that becomes a Subsidiary Guarantor
pursuant to SECTION 5.15.
"Supporting Obligations" means all "supporting obligations" as
such term is defined in the UCC, and, in any event, includes, without
limitation, letters of credit and guaranties issued in support of Accounts,
Chattel Paper, Documents, General Intangibles, Instruments, or Investment
Property.
"Syndicated Loans" means Revolving Loans, but not Settlement
Loans.
"Taxes" has the meaning set forth in SECTION 2.12(c).
"Tax Retention Operating Lease" means a lease of property for
which such Person retains tax ownership of the property subject to the
lease, but such lease is classified as an operating lease for purposes of
GAAP.
"Termination Date" means whichever is the earlier of (a) June 30,
2006, (b) the date the Commitments are terminated pursuant to SECTION 6.01
following the occurrence of an Event of Default, or (c) the date the
Borrower terminates the Commitments entirely pursuant to SECTION 2.08.
"Third Party" means any landlord, warehousemen, servicer,
processor, bailee and other third parties which may, from time to time, be
in the possession or control of, any Collateral or any property on which
any Collateral is or may be located.
CONFIDENTIAL
"Third Party Claims" means claims of Third Parties against the
Borrower or any Guarantor for rent, storage, maintenance, repair,
processing, servicing or bailment in respect of any Collateral or any
property on which any Collateral is or may be located.
"Trademarks" means (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, service
marks, logos, words, terms, names, symbols and devices and all combinations
thereof, and all other source or business identifiers, and all goodwill of
the business connected with the use thereof as symbolized thereby, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in
any similar office or agency of the United States, any State thereof or any
other country or any political subdivision thereof, or otherwise, and all
common-law rights related thereto, including, without limitation, those
listed in the Collateral Disclosure Certificates, and (ii) the right to
obtain all renewals and extensions thereof.
"Trademark Licenses" means all agreements, whether written or
oral, providing for the grant by or to the Borrower or any Guarantor of any
right to use any Trademark, including, without limitation, those listed in
the Collateral Disclosure Certificates, and all renewals of extensions
thereof.
"Transferee" has the meaning set forth in SECTION 10.08(d).
"UCC" means the Uniform Commercial Code Secured Transactions of
New York, as in effect on the date hereof and as the same may be amended,
restated, supplemented, or otherwise modified from time to time.
"Unfunded Vested Liabilities" means, with respect to any Plan at
any time, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Plan exceeds (b) the fair market value
of all Plan assets allocable to such benefits, all determined as of the
then most recent valuation date for such Plan, but only to the extent that
such excess represents a potential liability of a member of the Controlled
Group to the PBGC or the Plan under Title IV of ERISA.
"Unused Commitment" means at any date, (a) with respect to all
Lenders, an amount equal to the Aggregate Commitments less the Working
Capital Obligations and (b) with respect to any Lender, an amount equal to
the aggregate Unused Commitments determined in clause (a) above multiplied
by such Lender's Commitment Percentage.
"Unused Line Fee" has the meaning set forth in SECTION 2.07(a).
"Vehicles" means all of the Borrower's and each Guarantor's cars,
trucks, trailers, rolling stock, construction and earth moving equipment
and other vehicles covered by a certificate of title law of any state, and
all tires and other appurtenances to any of the foregoing, all whether now
existing or owned or hereafter acquired or arising.
"Wachovia" means Wachovia Bank, National Association, a national
banking association, and its successors.
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"Waiver Agreement" means a Waiver and Agreement substantially in
the form of EXHIBIT J, with any changes as may be acceptable to the Agent
in its reasonable discretion, executed and delivered by any Third Party
waiving or subordinating its Third Party Claims, and making certain other
agreements in regard to the Collateral, all on terms reasonably
satisfactory to the Agent in all respects.
"Wholly Owned Subsidiary" means any Subsidiary all of the shares
of capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the
Parent.
"Working Capital Obligations" means the sum at any time of (a)
the Aggregate Revolving Loan Amount Outstanding and (b) the Letter of
Credit Obligations.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all terms of an accounting character used
herein shall be interpreted, all accounting determinations hereunder shall
be made, and all financial statements required to be delivered hereunder
shall be prepared, in accordance with GAAP, applied on a basis consistent
(except for changes concurred in by the Certified Public Accountants or
otherwise required by a change in GAAP) with the most recent audited
consolidated financial statements of the Parent and the Subsidiaries
delivered to the Lenders unless with respect to any such change concurred
in by the Certified Public Accountants or required by GAAP, in determining
compliance with any of the provisions of this Agreement or any of the other
Credit Documents: (a) the Parent shall have objected to determining such
compliance on such basis at the time of delivery of such financial
statements, or (b) the Required Lenders shall so object in writing within
30 days after the delivery of such financial statements, in either of which
events such calculations shall be made on a basis consistent with those
used in the preparation of the latest financial statements as to which such
objection shall not have been made (which, if objection is made in respect
of the first financial statements delivered under SECTION 5.01 hereof,
means the financial statements referred to in SECTION 4.04).
SECTION 1.03. References. Unless otherwise indicated, references
in this Agreement to "articles", "exhibits", "schedules", "sections" and
other subdivisions are references to articles, exhibits, schedules,
sections and other subdivisions hereof. Terms which are defined in the UCC
and which are not otherwise defined herein or in the other Credit Documents
shall have the meanings given such terms in the UCC.
SECTION 1.04. Use of Defined Terms. All terms defined in this
Agreement shall have the same defined meanings when used in any of the
other Credit Documents, unless otherwise defined therein or unless the
context shall require otherwise.
SECTION 1.05. Terminology. The terms "herein," "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a
whole and not to any particular section, paragraph or subdivision. Any
pronoun used shall be deemed to cover all genders. 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 but excluding." Unless and to the extent otherwise expressly provided
herein, the term "pro rata" when applied to a Lender means such Lender's
Commitment Percentage. The section titles, table
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of contents and list of exhibits appear as a matter of convenience only and
shall not affect the interpretation of this Agreement. All references to
statutes and related regulations shall include any amendments of same and
any successor statutes and regulations. All references to any of the Credit
Documents shall include any and all amendment or modifications thereto and
any and all restatements, extensions or renewals thereof. All references to
any Person shall mean and include the successors and permitted assigns of
such Person. All references to "including" and "include" shall be
understood to mean "including, without limitation." All references to the
time of day shall mean the time of day on the day in question in Charlotte,
North Carolina, unless otherwise expressly provided in this Agreement. A
Default or an Event of Default shall be deemed to exist at all times during
the period commencing on the date that such Default or Event of Default
occurs to the date on which such Default or Event of Default is waived in
writing pursuant to this Agreement or, in the case of a Default, is cured
within any period of cure expressly provided in this Agreement; and an
Event of Default shall "continue" to be "continuing" until such Event of
Default has been waived in writing pursuant to this Agreement. Whenever the
phrase "to the best of the Borrower's knowledge" or words of similar import
relating to the knowledge or the awareness of the Borrower or the Parent
are used herein, such phrase shall mean and refer to (a) the actual
knowledge of a Senior Officer of the Borrower or the Parent or (b) the
knowledge that a Senior Officer of the Borrower or the Parent would have
obtained if he had engaged in a good faith and diligent performance of his
duties, including the making of such reasonable specific inquiries as may
be necessary of the officers, employees or agents of the Borrower, the
Parent or any Subsidiary and a good faith attempt to ascertain the
existence or accuracy of the matter to which such phrase relates. All
calculations of money values shall be in Dollars, all Loans made hereunder
shall be funded in Dollars, and all amounts payable in respect of any of
the Obligations shall be paid in Dollars. Any Lien referred to in this
Agreement or any of the other Credit Documents as having been created in
favor of the Agent, any agreement entered into by the Agent pursuant to
this Agreement or any of the other Credit Documents, any payment made by or
to or funds received by the Agent pursuant to or as contemplated by any of
the Credit Documents, or any other act taken or admitted to be taken by the
Agent shall, unless otherwise expressly provided, be created, entered into,
made or received or taken or omitted, for the benefit or account of the
Agent and the Lenders.
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend.
-------------------
(a) Revolving Loans. Each Lender severally agrees, on the terms
and conditions set forth herein, to make Revolving Loans to the Borrower
from time to time before the Termination Date; provided that, immediately
after each such Revolving Loan is made,
(i) the sum of (A) the Revolving Loans outstanding of each
Lender plus (B) such Lender's Commitment Percentage of the Letter
of Credit Obligations, will not exceed such Lender's Commitment,
and
(ii) the Revolving Loans will not exceed the lesser of (A)
the amount of the Aggregate Commitments, and (B) the aggregate
amount of the Borrowing
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Base (subject, however, to Overadvance Loans made pursuant to
SECTION 2.01(c));
(iii) Each Syndicated Borrowing under this SECTION 2.01(a)
shall be in an aggregate principal amount of (A) for Euro-Dollar
Loans, $3,000,000 or any larger integral multiple of $1,000,000,
and (B) for Base Rate Loans, $100,000 or any larger integral
multiple of $25,000 (except that any Revolving Loan Borrowing may
be in the aggregate amount of the Unused Commitments or the
amount of the Excess Borrowing Availability, whichever is lesser)
and shall be made from the several Lenders ratably in proportion
to their respective Commitments. Within the foregoing limits, the
Borrower may borrow under this SECTION, repay or, to the extent
permitted by SECTION 2.10, prepay Syndicated Loans and reborrow
under this SECTION at any time before the Termination Date.
(b) Settlement Loans.
(i) To facilitate the administration of the Revolving Loans
under this Agreement, the Lenders agree (which agreement shall
not be for the benefit of or enforceable by the Borrower) that
settlement among the Lenders with respect to the Revolving Loans
may take place on a periodic basis on dates determined from time
to time by the Agent (each a "Settlement Date"), which may occur
before or after the occurrence or during the continuance of a
Default or Event of Default and whether or not all of the
conditions set forth in ARTICLE 9 of this Agreement have been
satisfied, provided that any such Settlement Loan for which
settlement is to be made must have been advanced prior to the
date on which the Commitments have been terminated pursuant to
SECTION 6.01. On each Settlement Date, payment shall be made by
or to each Lender in the manner provided herein and in accordance
with the Settlement Report delivered by the Agent to the Lenders
with respect to such Settlement Date so that, as of each
Settlement Date, each Lender shall hold its Commitment Percentage
of all Revolving Loans then outstanding. As of the Closing Date,
the Agent intends to request settlement with the Lender once
every 5 Domestic Business Days.
(ii) Between Settlement Dates, the Agent may request
Wachovia to advance, and Wachovia may, but shall in no event be
obligated to, advance to the Borrower out of Wachovia's own funds
the entire principal amount of any Revolving Loan Borrowings that
are Base Rate Loans requested or deemed requested pursuant to
this Agreement (any such Revolving Loan funded exclusively by
Wachovia being referred to as a "Settlement Loan"). As provided
above in SECTION 2.01(a)(iii), Settlement Loans shall be in the
principal amount of $100,000 or any larger integral multiple of
$25,000 (except that any Revolving Loan Borrowing may be in the
aggregate amount of the Unused Commitments or the amount of the
Excess Borrowing Availability, whichever is lesser), and the
aggregate amount of Settlement Loans outstanding at any time
shall not exceed $10,000,000. Each Settlement Loan shall
constitute a Revolving Loan hereunder and shall be subject to all
of the terms, conditions and security applicable to other
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Revolving Loans, except that all payments thereon shall be
payable to Wachovia solely for its own account. The obligation of
the Borrower to repay such Settlement Loans to Wachovia shall be
evidenced by the records of Wachovia and need not be evidenced by
any promissory note. The Agent shall not request Wachovia to make
any Settlement Loan if (A) the Agent shall have received written
notice from any Lender that one or more of the applicable
conditions precedent set forth in ARTICLE 9 hereof will not be
satisfied on the requested funding date for the applicable
Borrowing, or (B) the requested Borrowing would exceed the amount
of Revolving Loans permitted to be made under SECTION 2.01(a).
Wachovia shall not otherwise be required to determine whether the
applicable conditions precedent set forth in ARTICLE 9 hereof
have been satisfied or the requested Borrowing would exceed the
amount of Revolving Loans permitted to be made under SECTION
2.01(a) prior to making, in its sole discretion, any Settlement
Loan. On each Settlement Date, or, if earlier, upon demand by the
Agent for payment thereof, the then outstanding Settlement Loans
shall be immediately due and payable. The Borrower shall be
deemed to have requested Revolving Loans to be made on each
Settlement Date in the amount of all outstanding Settlement Loans
and the proceeds of such Revolving Loans shall be applied to the
repayment of such Settlement Loans. The Agent shall notify the
Lenders of the outstanding balance of Revolving Loans prior to
12:00 noon, Charlotte, North Carolina, time, on such funding
date. The proceeds of Settlement Loans may be used solely for
purposes for which Revolving Loans may be used in accordance with
SECTION 5.06 hereof. If any amounts received by Wachovia in
respect of any Settlement Loans are later required to be returned
or repaid by Wachovia to the Borrower or their respective
representatives or successors-in-interest, whether by court
order, settlement or otherwise, each Lender shall, upon demand by
Wachovia with notice to Agent, pay to Agent for the account of
Wachovia an amount equal to such Lender's Commitment Percentage
of all such amounts required to be returned by Wachovia.
(c) Overadvance Loans. Notwithstanding the existence of a Default
or an Event of Default or any other provision of this Agreement to the
contrary, provided the Commitments have not been terminated pursuant to
SECTION 6.01, (i) the Agent may, from time to time, in the exercise of its
sole discretion, advance Revolving Loans on behalf of the Lenders equal to
the lesser of (A) the Unused Commitment, and (B) an amount not greater than
$5,000,000 in excess of the amount of the Borrowing Base, and/or (ii)
Wachovia may, from time to time in the exercise of its sole discretion, at
the request of the Agent and in the exercise of the Agent's sole
discretion, make Settlement Loans equal to the lesser of (A) the Unused
Commitment, and (B) an amount not greater than $5,000,000 in excess of the
amount of the Borrowing Base (each such Loan made under clause (i) and/or
(ii) of this paragraph (c) is herein referred to as an "Overadvance Loan");
provided, however, that each Overadvance Loan made pursuant to this SECTION
2.01(c) shall (x) become due and payable in full on or before the date
which is 10 Business Days after such Overadvance Loan is made, and (y) not
be made during any period longer than 10 Business Days after the date on
which such first Overadvance Loan was made in excess of the Borrowing Base
under this SECTION 2.01(c).
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SECTION 2.02. Method of Borrowing.
-------------------
(a) The Borrower shall give the Agent notice (a "Notice of
Borrowing"), which shall be substantially in the form of EXHIBIT E, prior
to (i) as to Base Rate Loans, 11:00 A.M. (Charlotte, North Carolina, time)
on the Domestic Business Day of such Base Rate Borrowing, and (ii) as to
Euro-Dollar Loans, 11:00 A.M. (Charlotte, North Carolina, time), at least 3
Euro-Dollar Business Days before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Base Rate Borrowing or a
Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing are to be
Base Rate Loans or Euro-Dollar Loans, and
(iv) in the case of a Euro-Dollar Borrowing, the duration of
the Interest Period applicable thereto, subject to the provisions
of the definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Lender of the contents thereof and of such Lender's
ratable share of such Borrowing, unless it is advanced as a Settlement Loan
Borrowing, and such Notice of Borrowing, once received by the Agent, shall
not thereafter be revocable by the Borrower.
(c) Not later than (i) as to Euro-Dollar Borrowings, 11:00 A.M.
(Charlotte, North Carolina, time), and (ii) as to Base Rate Borrowings,
2:00 P.M. (Charlotte, North Carolina, time) on the date of each Syndicated
Borrowing, each Lender shall (except as provided in paragraph (e) of this
SECTION) make available its ratable share of such Syndicated Borrowing, in
Federal or other funds immediately available in Charlotte, North Carolina,
to the Agent at its address determined pursuant to SECTION 10.01. Unless
the Agent determines that any applicable condition specified in ARTICLE 9
has not been satisfied, the Agent will make the funds so received from the
Lenders available to the Borrower at the Agent's aforesaid address. Unless
the Agent receives notice from a Lender, at the Agent's address referred to
in or specified pursuant to SECTION 10.01, no later than 3:00 P.M. (local
time at such address) on the Domestic Business Day before the date of a
Syndicated Borrowing stating that such Lender will not make a Syndicated
Loan in connection with such Syndicated Borrowing, the Agent shall be
entitled to assume that such Lender will make a Syndicated Loan in
connection with such Syndicated Borrowing and, in reliance on such
assumption, the Agent may (but shall not be obligated to) make available
such Lender's ratable share of such Syndicated Borrowing to the Borrower
for the account of such Lender. If the Agent makes such Lender's ratable
share available to the Borrower and such Lender does not in fact make its
ratable share of such Syndicated Borrowing available on such date, the
Agent shall be entitled to recover such Lender's ratable share from such
Lender or the Borrower (and for such purpose shall be entitled to charge
such amount to any account of the Borrower maintained with the Agent),
together with interest thereon for each day during the period from the date
of such Syndicated Borrowing until
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such sum shall be paid in full at a rate per annum equal to the rate at
which the Agent determines that it obtained (or could have obtained)
overnight Federal funds to cover such amount for each such day during such
period, provided that (x) any such payment by the Borrower of such Lender's
ratable share and interest thereon shall be without prejudice to any rights
that the Borrower may have against such Lender and (y) until such Lender
has paid its ratable share of such Syndicated Borrowing, together with
interest pursuant to the foregoing, it will have no interest in or rights
with respect to such Syndicated Borrowing for any purpose hereunder. If the
Agent does not exercise its option to advance funds for the account of such
Lender, it shall forthwith notify the Borrower of such decision. Unless the
Agent determines that any applicable condition specified in ARTICLE 9 has
not been satisfied, Wachovia will make available to the Borrower at its
Lending Office the amount of any such Borrowing that is a Settlement Loan
Borrowing requested by the Borrower.
(d) If any Lender makes a new Syndicated Loan hereunder on a day
on which the Borrower is to repay all or any part of an outstanding
Syndicated Loan from such Lender, such Lender shall apply the proceeds of
its new Syndicated Loan to make such repayment as a Refunding Loan and only
an amount equal to the difference (if any) between the amount being
borrowed and the amount of such Refunding Loan shall be made available by
such Lender to the Agent as provided in paragraph (c) of this SECTION, or
remitted by such Borrower to the Agent as provided in SECTION 2.12, as the
case may be.
(e) Notwithstanding anything to the contrary contained in this
Agreement, the Lenders shall not be obligated to make any Euro-Dollar Loans
if there shall have occurred a Default or an Event of Default, which
Default or Event of Default shall not have been cured or waived, and all
Refunding Loans shall be made as Base Rate Loans (but shall bear interest
at the Default Rate, if applicable). Nothing in the preceding sentence
shall obligate, or be deemed to obligate, any of the Lenders to make any
Loans at all during the existence of an Event of Default, other than (i)
Refunding Loans in the event that the Obligations have not been accelerated
pursuant to SECTION 6.01, and (ii) advances on any Settlement Date of a
Lender's Commitment Percentage of Settlement Loans or Overadvance Loans
made prior to the termination of the Commitments pursuant to SECTION 6.01.
(f) In the event that a Notice of Borrowing fails to specify
whether the Syndicated Loans comprising such Syndicated Borrowing are to be
Base Rate Loans or Euro-Dollar Loans, such Syndicated Loans shall be made
as Base Rate Loans. If the Borrower is otherwise entitled under this
Agreement to repay any Syndicated Loans maturing at the end of an Interest
Period applicable thereto with the proceeds of a new Borrowing, and the
Borrower fails to repay such Syndicated Loans using its own moneys and
fails to give a Notice of Borrowing in connection with such new Syndicated
Borrowing, a new Syndicated Borrowing shall be deemed to be made on the
date such Syndicated Loans mature in an amount equal to the principal
amount of the Syndicated Loans so maturing, and the Syndicated Loans
comprising such new Syndicated Borrowing shall be Base Rate Loans.
(g) Notwithstanding anything to the contrary contained herein,
there shall not be more than 5 Euro-Dollar Borrowings outstanding at any
given time.
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SECTION 2.03. Continuation and Conversion Elections.
-------------------------------------
(a) By delivering a notice (a "Notice of Continuation or
Conversion"), which shall be substantially in the form of Exhibit E-2, to
the Agent on or before 11:00 A.M., Charlotte, North Carolina time, on a
Domestic Business Day (or Euro-Dollar Business Day, in the case of
Euro-Dollar Loans outstanding), the Borrower may from time to time
irrevocably elect, by notice on the same Domestic Business Day, in the case
of Base Rate Loans, or 3 Euro-Dollar Business Days, in the case of
Euro-Dollar Loans, that all, or any portion in an aggregate principal
amount of $3,000,000 or any larger integral multiple of $1,000,000 be, (i)
in the case of Base Rate Loans, converted into Euro-Dollar Loans or, (ii)
in the case of Euro-Dollar Loans, continued as Euro-Dollar Loans, or that
all, or any portion in an aggregate principal amount of $100,000 or any
larger integral multiple of $25,000 be, in the case of Euro-Dollar Loans,
converted into Base Rate Loans (in the absence of delivery of a Notice of
Continuation or Conversion with respect to any Euro-Dollar Loan at least 3
Euro-Dollar Business Days before the last day of the then current Interest
Period with respect thereto, such Euro-Dollar Loan shall, on such last day,
automatically convert to a Base Rate Loan); provided, however, that (x)
each such conversion or continuation shall be pro rated among the
applicable outstanding Loans of all Lenders that have made such Loans, and
(y) no portion of the outstanding principal amount of any Loans may be
continued as, or be converted into, any Euro-Dollar Loan when any Event of
Default has occurred and is continuing.
SECTION 2.04. Notes.
-----
(a) The Revolving Loans of each Lender shall be evidenced by a
single Revolving Loan Note payable to the order of such Lender for the
account of its Lending Office in an amount equal to the original principal
amount of such Lender's Commitment. The Settlement Loans shall be evidenced
by a single Settlement Loan Note payable to the order of Wachovia in the
original principal amount of $10,000,000.
(b) Upon receipt of each Lender's Notes pursuant to SECTION 9.01,
the Agent shall deliver such Notes to such Lender. Each Lender (or
Wachovia, with respect to the Settlement Loan Note) will record either on
its own books and records or on Schedules attached to its Notes, at its
option, and prior to any transfer of its Notes will transfer a copy of the
relevant portions of its books and records or endorse on such schedules
attached to its Notes appropriate notations to evidence; the date, amount
and maturity of, and effective interest rate for, each Loan made by it, and
the date and amount of each payment of principal made by the Borrower with
respect thereto. Such records, whether on the Lender's books and records or
on Schedules to the Notes will constitute prima facie evidence, in the
absence of manifest error, of the respective principal amounts owing and
unpaid on such Lender's Notes; provided that the failure of any Lender to
make, or any error in making, any such recordation or endorsement shall not
affect the obligation of the Borrower hereunder or under the Notes or the
ability of any Lender to assign its Notes. Each Lender is hereby
irrevocably authorized by the Borrower so to endorse its Notes, in the
event such option is elected by such Lender, and to attach to and make a
part of any Note a continuation of any such Schedule as and when required.
(c) The Agent shall maintain on its books a control account for
the Borrower in which shall be recorded (i) the date, amount, effective
interest rate and maturity of each
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Revolving Loan and Settlement Loan made hereunder to the Borrower, (ii) the
amount of any principal, interest or fees due or to become due from the
Borrower on the Revolving Loans and the Settlement Loans and (iii) the
amount of any sum received by the Agent hereunder in respect of any such
principal, interest or fees due on the Revolving Loans and Settlement Loans
and each Lender's Commitment Percentage thereof.
(d) The entries made in the accounts pursuant to paragraph (c)
above shall be prima facie evidence, in the absence of manifest error, of
the existence and amounts of the Obligations of the Borrower therein
recorded and any payments thereon, and in case of discrepancy between such
accounts and the schedules to the Revolving Loan Notes maintained by any
Lender pursuant to paragraph (b) or between such accounts and the books and
records of the Borrower, in the absence of manifest error, the control
account maintained by the Agent pursuant to paragraph (c) above shall be
controlling with respect to Revolving Loans and Settlement Loans.
SECTION 2.05. Maturity of Loans.
-----------------
(a) Each Euro-Dollar Loan included in any Borrowing will mature,
and the principal amount thereof will be due and payable, on the last day
of the Interest Period applicable to such Borrowing, subject to the advance
of a Refunding Loan, unless such Loan will be due and payable prior thereto
by reason of the provisions of this Agreement (including, without
limitation, SECTION 6.01).
(b) Notwithstanding the foregoing, the outstanding principal
amount of all Loans, if any, together with all accrued but unpaid interest
thereon, if any, shall be due and payable on the Termination Date (provided
they have been accelerated, if the Termination Date occurs under clause (b)
of the definition thereof).
SECTION 2.06. Interest Rates.
--------------
(a) "Applicable Margin" means: (i) for any Base Rate Loan, 0.75%,
and (ii) for any Euro-Dollar Loan, 2.25%.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made
until it becomes due, at a rate per annum equal to the Base Rate for such
day plus the Applicable Margin. Such interest shall be payable for each
calendar month on the first day of the next calendar month. Any overdue
principal of and, to the extent permitted by applicable law, overdue
interest on any Base Rate Loan shall bear interest, payable on demand, for
each day until paid at a rate per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a
rate per annum equal to the sum of the Applicable Margin plus the
applicable Adjusted London Interbank Offered Rate for such Interest Period.
Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is 6 months or longer, at intervals of
3 months after the first day of such Interest Period. Any overdue principal
of and, to the extent permitted by law, overdue
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interest on any Euro-Dollar Loan shall bear interest, payable on demand,
for each day until paid at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained
(rounded upwards, if necessary, to the next higher 1/100th of 1%) by
dividing (i) the applicable London Interbank Offered Rate for such Interest
Period by (ii) 1.00 minus the Euro-Dollar Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Euro-Dollar
Loan means for the Interest Period of such Euro-Dollar Loan, the rate per
annum determined on the basis of the offered rate for deposits in Dollars
of amounts equal or comparable to the principal amount of such Euro-Dollar
Loan offered for a term comparable to such Interest Period, which rates
appear on the Telerate Page 3750 effective as of 11:00 A.M., London time, 2
Euro-Dollar Business Days prior to the first day of such Interest Period,
provided that if no such offered rates appear on such page, the "London
Interbank Offered Rate" for such Interest Period will be the arithmetic
average (rounded upward, if necessary, to the next higher 1/100th of 1%) of
rates quoted by not less than 2 major banks in New York City, selected by
the Agent, at approximately 10:00 A.M., New York City time, 2 Euro-Dollar
Business Days prior to the first day of such Interest Period, for deposits
in Dollars offered by leading European banks for a period comparable to
such Interest Period in an amount comparable to the principal amount of
such Euro-Dollar Loan.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member
bank of the Federal Reserve System in respect of "eurocurrency liabilities"
(or in respect of any other category of liabilities which includes deposits
by reference to which the interest rate on Euro-Dollar Loans is determined
or any category of extensions of credit or other assets which includes
loans by a non-United States office of any Lender to United States
residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the
Euro-Dollar Reserve Percentage.
(d) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower and
the Lenders by telecopier of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(e) After the occurrence and during the continuance of an Event
of Default, the principal amount of the Loans (and, to the extent permitted
by applicable law, all accrued interest thereon) may, at the election of
the Required Lenders, bear interest at the Default Rate from the date of
such Event of Default (which date with respect to SECTION 5.19 shall be
deemed to occur on the date Event of Default occurred, not the date of
delivery of the Compliance Certificate).
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SECTION 2.07. Fees.
----
(a) The Borrower shall pay to the Agent, for the ratable account
of each Lender, an Unused Line Fee (the "Unused Line Fee"), calculated on
the average daily amount of such Lender's pro rata share of the Unused
Commitment (without taking into account any Settlement Loans) during each
calendar quarter, at a rate per annum determined by reference to the table
below, depending on the percentage of the average daily amount of Unused
Commitment during such calendar quarter:
------------------------------------------
PERCENTAGE OF AVERAGE UNUSED LINE FEE
DAILY UNUSED PERCENTAGE
COMMITMENT
------------------------------------------
------------------------------------------
[greater than] 66.6% 0.50%
------------------------------------------
[less than] 66.6% but
[greater than]33.4% 0.375%
------------------------------------------
[less than] 33.4% 0.25%
------------------------------------------
Such Unused Line Fee shall accrue from and including the Closing Date to
but excluding the Termination Date and shall be payable on the last
Business Day of each calendar quarter and on the Termination Date.
(b) The Borrower shall pay to the Agent, for the ratable account
of each Lender, an up-front fee in an amount set forth in or determined
pursuant to a separate letter agreement between the Arranger and such
Lender, payable on the Closing Date.
(c) The Borrower shall pay to the Agent, for the account and sole
benefit of the Agent and the Arranger, as the case may be, such fees and
other amounts at such times as set forth in the Fee Letter.
SECTION 2.08. Optional Termination or Reduction of Commitments.
The Borrower may, upon at least 5 days' prior written notice to the Agent,
terminate the Commitments in their entirety at any time, or upon at least 3
Domestic Business Days' prior written notice to the Agent, proportionately
reduce the Unused Commitments from time to time by an aggregate amount of
at least $5,000,000 or any larger integral multiple of $5,000,000, so long
as such reduction shall not cause the Aggregate Commitments to be reduced
below $0 (unless terminated in their entirety). If the Commitments are
terminated in their entirety, all accrued fees (as provided under SECTION
2.08) shall be due and payable on the effective date of such termination
and the Borrower shall pledge in favor of the Agent cash collateral equal
to at least 105% of the outstanding Letter of Credit Obligations, if any.
SECTION 2.09. Mandatory Reduction and Termination of Commitments.
The Commitments shall terminate on the Termination Date and any Loans then
outstanding (together with accrued interest thereon) shall be due and
payable on such date and the Borrower shall
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pledge in favor of the Agent cash collateral equal to at least 105% of the
outstanding Letter of Credit Obligations, if any.
SECTION 2.10. Optional Prepayments.
--------------------
(a) Upon notice to the Agent prior to 11:00 A.M. (Charlotte,
North Carolina, time) on the same Domestic Business Day, the Borrower may
prepay any Loan which is a Base Rate Borrowing in whole at any time, or
from time to time in part in amounts aggregating at least $100,000 or any
larger integral multiple of $25,000 (or, if less, the entire principal
amount of such Borrowing), by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Base Rate Loans
of the several Lenders included in such Base Rate Borrowing.
(b) Euro-Dollar Loans may not be prepaid (whether as new advances
of Loans or Refunding Loans) before the end of the Interest Period
applicable to such Loans, unless payment is accompanied by any compensation
payments required by SECTION 8.05, or unless the amount of such prepayment
in amounts aggregating at least $3,000,000 or any larger integral multiple
of $1,000,000 (or, if less, the entire principal amount of such Borrowing)
and interest through the end of the Interest Period therefor is deposited
with the Agent as cash collateral to secure the Obligations with the
direction and authorization given to the Agent to apply such cash
collateral toward payment of such Euro-Dollar Loan at the end of such
Euro-Dollar Loan's Interest Period.
(c) Euro-Dollar Loans may not be prepaid (whether as new advances
of Loans or Refunding Loans) before the end of the Interest Period
applicable to such Loans, except as permitted by all of the Lenders in the
exercise of their sole discretion, subject to any compensation payments
required by SECTION 8.05, subject to any compensation payments required by
SECTION 8.05, unless the amount of such prepayment is deposited with the
Agent as cash collateral to secure the Obligations with the direction and
authorization given to the Agent to apply such cash collateral toward
payment of such Euro-Dollar Loan at the end of such Euro-Dollar Loan's
Interest Period.
(d) Upon receipt of a notice of prepayment pursuant to this
SECTION 2.10, the Agent shall promptly notify each Lender of the contents
thereof and of such Lender's ratable share of such prepayment (except with
respect to Settlement Loans, unless the Lenders have purchased interests
therein pursuant to SECTION 2.01(b)) and such notice, once received by the
Agent, shall not thereafter be revocable by the Borrower.
(e) In the event that any Loan is prepaid on the same day such
Loan was advanced, interest hereunder on such Loan shall be due and payable
for that day.
SECTION 2.11. Mandatory Prepayments.
---------------------
(a) On each date on which the Commitments are reduced pursuant to
SECTION 2.08 or SECTION 2.09, the Borrower shall repay or prepay such
principal amount of the outstanding Revolving Loans, if any (together with
interest accrued thereon and any amount due under SECTION 8.05(a)), as may
be necessary so that after such payment the aggregate
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unpaid amount of the Working Capital Obligations does not exceed the
aggregate amount of the Commitments as then reduced.
(b) On each date on which the Revolving Loans exceed the
Borrowing Base, the Borrower shall immediately repay or prepay such
principal amount of the outstanding Revolving Loans, if any (together with
interest accrued thereon and any amount due under SECTION 8.05(a)), as may
be necessary so that after such payment the Revolving Loans do not exceed
the Borrowing Base. Each such payment or prepayment shall be applied
ratably to the Revolving Loans of the Lenders outstanding on the date of
payment or prepayment in the following order of priority: (i) first, to
Settlement Loans; (ii) secondly, to Base Rate Loans which are not
Settlement Loans; and, (iii) lastly, to Euro-Dollar Loans.
SECTION 2.12. General Provisions as to Payments.
---------------------------------
(a) The Borrower shall make each payment of principal of, and
interest on, the Loans and of fees hereunder, without any setoff,
counterclaim or any deduction whatsoever, not later than 1:00 P.M.
(Charlotte, North Carolina, time) on the date when due, in Federal or other
funds immediately available in Charlotte, North Carolina, to the Agent at
its address referred to in SECTION 10.01. All payments received by the
Agent after 1:00 P.M. (Charlotte, North Carolina, time) on any Business Day
shall be deemed to be received on the following Business Day. The Agent
will promptly distribute to each Lender its ratable share of each such
payment received by the Agent for the account of the Lenders.
(b) Whenever any payment of principal of, or interest on, the
Base Rate Loans or of fees hereunder shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to
the next succeeding Domestic Business Day. Whenever any payment of
principal of or interest on, the Euro-Dollar Loans shall be due on a day
which is not a Euro-Dollar Business Day, the date for payment thereof shall
be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business
Day.
(c) All payments of principal, interest and fees and all other
amounts to be made by the Borrower with respect to the Obligations or
otherwise (including, without limitation, with respect to the Letter of
Credit Obligations) pursuant to this Agreement shall be made free and clear
of, and without deduction or withholding for or on account of, any current
or future income, stamp or other taxes, levies, imposts, duties, charges,
fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any governmental authority or by any
taxing authority thereof or therein, excluding (i) net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on the Agent
or any Lender and (ii) any taxes imposed on the Agent or any Lender as a
result of a current or former connection between the Agent or such Lender
and the jurisdiction of the governmental authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than
any such connection arising solely from the Agent or such Lender having
executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement). If any such non-excluded taxes,
levies, imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts payable
to the Agent or any
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Lender hereunder, the amounts so payable to the Agent or such Lender shall
be increased to the extent necessary to yield to the Agent or such Lender
(after payment of all Non-Excluded Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement; provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender that is not organized under
the laws of the United States or a state thereof if such Lender fails to
comply with the requirements of paragraph (e) of this Section 2.12.
Whenever any Non-Excluded Taxes are payable by the Borrower, as promptly as
possible thereafter the Borrower shall send to the Agent for its own
account or for the account of such Lender, as the case may be, a certified
copy of an original official receipt received by the Borrower showing
payment thereof. If the Borrower fails to pay any Non-Excluded Taxes when
due to the appropriate taxing authority or fails to remit to the Agent the
required receipts or other required documentary evidence, the Borrower
shall indemnify the Agent and the Lenders for any incremental taxes,
interest, costs or penalties that may become payable by the Agent or any
Lender as a result of any such failure. The agreements in this Section
2.12(c) shall survive the termination of this Agreement and the payment of
the Loans and all other amounts payable hereunder.
(d) Each Lender that is not incorporated or organized under the
laws of the United States or a state thereof (a "Non-U.S. Lender") shall:
(i) deliver to the Borrower and the Agent two copies of such
properly completed documentation, duly executed by such Non-U.S.
Lender, prescribed by applicable law or reasonably requested by
the Borrower, as will permit such payments to be made without
withholding, or at a reduced rate of, U.S. Federal withholding
tax on payments by the Borrower under this Agreement;
(ii) deliver to the Borrower and the Agent two further
copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete
and after the occurrence of any event requiring a change in the
most recent form previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by
the Borrower or the Agent;
unless in any such case any change in treaty, law or regulation
has occurred prior to the date on which any such delivery would otherwise
be required that renders any such form inapplicable or would prevent such
Lender from duly completing and delivering any such form with respect to it
and such Lender so advises the Borrower and the Agent. Each Person that
shall become a Transferee pursuant to SECTION 10.08 shall, upon the
effectiveness of the related transfer, be required to provide all the forms
and statements required pursuant to this Section 2.12 (d), provided that in
the case of a Participant such Participant shall furnish all such required
forms and statements to the Lender from which the related participation
shall have been purchased.
(e) The Borrower shall not be required to indemnify any Non-U.S.
Lender, or to pay any additional amounts to any Non-U.S. Lender, in respect
of U.S. Federal withholding tax pursuant to paragraph (d) above to the
extent that (i) the obligation to withhold amounts with
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respect to U.S. Federal withholding tax existed on the date such Non-U.S.
Lender became a party to this Agreement (or, in the case of a Non-U.S.
Participant, on the date such Participant became a Participant hereunder);
provided, however, that this clause (i) shall not apply to the extent that
(x) the indemnity payments or additional amounts any Lender (or
Participant) would be entitled to receive (without regard to this clause
(i)) do not exceed the indemnity payment or additional amounts that the
person making the assignment, participation or transfer to such Lender (or
Participant) would have been entitled to receive in the absence of such
assignment, participation or transfer, or (y) such assignment,
participation or transfer had been requested by the Borrower, (ii) the
obligation to pay such additional amounts would not have arisen but for a
failure by such Non-U.S. Lender or Non-U.S. Participant to comply with the
provisions of paragraph (d) above or (iii) any of the representations or
certifications made by a Non-U.S. Lender or Non-U.S. Participant pursuant
to paragraph (d) above are incorrect at the time a payment hereunder is
made, other than by reason of any change in treaty, law or regulation
having effect after the date such representations or certifications were
made.
(f) If the Borrower determines in good faith that a reasonable
basis exists for contesting any taxes for which indemnification has been
demanded hereunder, the relevant Lender or the Agent, as applicable, shall
cooperate with the Borrower in challenging such taxes at the Borrower's
expense if so requested by the Borrower. If any Lender or the Agent, as
applicable, receives a refund of a tax for which a payment has been made by
the Borrower pursuant to this Agreement, which refund in the good faith
judgment of such Lender or Agent, as the case may be, is attributable to
such payment made by the Borrower, then the Lender or the Agent, as the
case may be, shall reimburse the Borrower for such amount as the Lender or
Agent, as the case may be, determines to be the proportion of the refund as
will leave it, after such reimbursement, in no better or worse position
than it would have been in if the payment had not been required. A Lender
or Agent shall claim any refund that it determines is available to it,
unless it concludes in its reasonable discretion that it would be adversely
affected by making such a claim. Neither the Lender nor the Agent shall be
obliged to disclose any information regarding its tax affairs or
computations to the Borrower in connection with this paragraph (f) or any
other provision of this Section 2.12.
(g) Each Lender represents and agrees that, on the date hereof
and at all times during the term of this Agreement, it is not and will not
be a conduit entity participating in a conduit financing arrangement (as
defined in Section 7701(l) of the Code and the regulations thereunder) with
respect to the borrowings hereunder unless the Borrower has consented to
such arrangement prior thereto.
(h) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower and
the Lenders contained in this Section 2.12 shall be applicable with respect
to any Participant, Assignee or other Transferee, and any calculations
required by such provisions (i) shall be made based upon the circumstances
of such Participant, Assignee or other Transferee, and (ii) constitute a
continuing agreement and shall survive the termination of this Agreement
and the payment in full or cancellation of the Notes.
Any Lender claiming any additional amounts payable pursuant to this Section
2.12 shall use reasonable efforts (consistent with legal and regulatory
restrictions) to file any certificate or
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document reasonably requested by the Borrower or to change the jurisdiction
of its applicable Lending Office if the making of such filing or change
would avoid the need for or reduce the amount of any such additional
amounts that may thereafter accrue or avoid the circumstances giving rise
to such exercise and would not, in the reasonable determination of such
Lender, result in any additional costs, expenses or risks or be otherwise
disadvantageous to it. Each Lender agrees to use reasonable efforts to
notify the Borrower as promptly as practicable upon its becoming aware that
circumstances exist that would cause the Borrower to become obligated to
pay additional amounts to such Lender pursuant to this Section 2.12;
provided that such Lender shall not be entitled to claim any additional
cost, reduction in amounts, loss, tax or other additional amount if such
Lender fails to provide such notice to the Borrower within 90 days of the
date such Lender becomes aware of the occurrence of the event giving rise
to the additional cost, reduction in amounts, loss, tax or other additional
amount.
(i) Prior to the existence of an Event of Default and application
of monies pursuant to SECTION 2.12(j), all monies to be applied to the
Obligations (except for proceeds collected in the Collateral Reserve
Accounts which are applied as provided in SECTION 2.15), whether such
monies represent voluntary payments by the Borrower or are received from
any disposition of Collateral, shall be allocated among the Agent and such
of the Lenders as are entitled thereto (and, with respect to monies
allocated to the Lenders in accordance with their Commitment Percentage
unless otherwise provided herein) as specified by the Borrower; provided,
however, that from and after the provisions of SECTION 2.15(a)(ii) become
applicable, they shall be applied in the following order (in each case,
until all Obligations within each category itemized in this paragraph (i)
below are fully paid): (i) first, to the Agent for the benefit of the
Lenders in payment of accrued interest then due and payable in respect of
the Loans; (ii) second, to Wachovia toward payment of principal of
Settlement Loans; (iii) third, ratably, to payment of principal of (A) the
Loans and (B) any obligations owing to any Lender with respect to any
Interest Rate Protection Agreements; (iv) fourth, to the Lenders for any
amounts owed under indemnification obligations that they have paid to the
Agent and for any expenses that they have reimbursed to the Agent; (v)
fifth, to the Agent to pay any amounts owed under indemnification
obligations that have not been paid to Agent by the Lenders or the
Borrower, together with interest accrued thereon; (vi) sixth, to the Agent
to pay any fees due and payable to Agent; (vii) seventh, to the Agent
first, and then to the Lenders, to pay the amount of expenses that have not
been reimbursed, respectively, to the Agent or the Lenders by the Borrower
(or the other Lenders, as applicable) in accordance with the terms of this
Agreement, together with any interest accrued thereon;; (viii) eighth, to
the payment of Fees payable (A) first with respect to any outstanding
Letter of Credit Obligations then due and owing, then (B) second with
respect to ForEx Obligations; (ix) ninth, as cash collateral for any
outstanding Letter of Credit Obligations equal to 105% of the undrawn
amount thereof; (x) tenth, to payment of the Reimbursement Obligations;
(xi) eleventh, to payment of the ForEx Obligations; (xii) twelfth, to the
Lenders in payment of accrued interest then due and payable in respect of
any Obligations other than the Loans then outstanding; and (xiii) lastly,
to any other Obligations then due and payable.
(j) During the existence of an Event of Default, if so determined
solely by the Agent in its commercially reasonable judgement or at the
election of the Required Lenders, and at all times after the Obligations
have become due and payable, all monies to be applied to the
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Obligations, whether such monies represent voluntary payments by the
Borrower or are received pursuant to acceleration of the Loans or realized
from any disposition of Collateral, shall be allocated among the Agent and
such of the Lenders as are entitled thereto (and, with respect to monies
allocated to the Lenders in accordance with their Commitment Percentage
unless otherwise provided herein) in the following order (in each case,
until all Obligations within each category itemized in this paragraph (j)
below are fully paid): (i) first, to the Agent to pay principal and accrued
interest on any portion of the Revolving Loans which Agent may have
advanced on behalf of any Lenders and for which Agent has not been
reimbursed by such Lender or the Borrower; (ii) second, to Wachovia to pay
the principal and accrued interest on any portion of the Settlement Loans
outstanding; (iii) third, to the Agent first, and then to the Lenders, to
pay the amount of expenses that have not been reimbursed, respectively, to
the Agent or the Lenders by the Borrower (or the other Lenders, as
applicable) in accordance with the terms of this Agreement, together with
any interest accrued thereon; (iv) fourth, to the Agent to pay any amounts
owed under indemnification obligations that have not been paid to Agent by
the Lenders or the Borrower, together with interest accrued thereon; (v)
fifth, to the Agent to pay any fees due and payable to Agent; (vi) sixth,
to the Lenders for any amounts owed under indemnification obligations that
they have paid to the Agent and for any expenses that they have reimbursed
to the Agent; (vii) seventh, to the payment of Fees payable (A) first with
respect to Letter of Credit Obligations, then (B) second with respect to
ForEx Obligations; (viii) eighth, as cash collateral for any Letter of
Credit Obligations equal to 105% of the undrawn amount thereof; (ix) ninth,
to payment of the Reimbursement Obligations; (x) tenth, to the Lenders in
payment of accrued interest then due and payable in respect of the Loans
and any other Obligations then outstanding; (xi) eleventh, ratably, to
payment of principal of (A) the Loans and (B) any obligations owing to any
Lender with respect to any Interest Rate Protection Agreements; (xii),
twelfth, any obligations owing to any Lender with respect to any ForEx
Obligations; and (xiii) lastly, to any other Obligations then due and
payable. The allocations set forth in this SECTION 2.12(j) are solely to
determine the rights and priorities of Agent and Lenders as among
themselves and may be changed by Agent and Lenders without notice to or the
consent or approval of the Borrower or any other Person.
(k) The Borrower hereby authorizes and directs the Agent, and
each Lender hereby authorizes and directs the Agent, to advance Revolving
Loans (pro rata for each Lender) for the amount due when the same becomes
due (whether on a Domestic Business Day or on a day which is not a Domestic
Business Day) with respect to any interest or fees on any of the Loans,
subject to the terms and conditions of this Agreement; provided, however,
in no event shall the Agent be obligated to make any such Loans at any
time, and the Borrower agrees that it remains obligated to make any such
payments when due; provided, further, that the Agent will promptly notify
the Borrower in the event the Agent does not make any such payments of
interest or fees by advancing Revolving Loans, unless the Agent has
notified the Borrower that the Agent will no longer make such advances of
Revolving Loans for the payment of interest and fees on any of the Loans.
Unless the Agent shall have received a Notice of Borrowing on a timely
basis prior to any such due date requesting a Euro-Dollar Loan, subject to
the terms of this Agreement, any Loan advanced by the Agent under this
SECTION 2.12(k) shall be advanced as a Base Rate Loan.
SECTION 2.13. Computation of Interest and Fees. Interest on Base
Rate Loans based on the Base Rate shall be computed on the basis of a year
of 365/366 days and paid for the
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actual number of days elapsed (including the first day but excluding the
last day). Interest on Euro-Dollar Loans will be computed on the basis of a
year of 360 days and paid for the actual number of days elapsed, calculated
as to each Interest Period from and including the first day thereof to but
excluding the last day thereof. Unused Line Fees and any other fees payable
hereunder shall be computed on the basis of a year of 360 days and paid for
the actual number of days elapsed (including the first day but excluding
the last day).
SECTION 2.14. All Loans to Constitute One Obligation. The Loans
shall constitute one general Obligation of the Borrower, and shall be
secured by the Liens on the Collateral in favor of the Agent.
SECTION 2.15. Lockbox; Collateral Reserve Accounts; Control
Agreements.
(a)
(i) Simultaneously herewith, the Borrower and each Guarantor
(except to the extent that and for so long as the Agent has
notified such Guarantor that the Agent has determined that, based
on the types of assets of such Guarantor, compliance with this
SECTION 2.15(a) will be suspended as to such Guarantor until
notice to the contrary by the Agent) shall establish and
continually maintain with the Agent one or more Collateral
Reserve Accounts and it and the Agent shall execute Deposit
Account Control Agreements with all depositary banks other than
Wachovia (so that all such banks become Approved Depositaries)
into which is deposited all cash, checks, drafts, items and other
Instruments for the payment of money which it now has or may at
any time hereafter receive in full or partial payment for the
Inventory, payment on any of the Borrower's or Guarantor's
Accounts, Chattel Paper, or General Intangibles, or as Proceeds
of the Borrower's or Guarantor's Inventory, Accounts, Chattel
Paper, or General Intangibles. In addition, the Borrower and each
Guarantor receiving Net Casualty/Insurance Proceeds shall (or
shall cause such other Person receiving such cash proceeds to)
remit all such cash proceeds to Wachovia. In the event such items
of payment are inadvertently received by the Borrower or any of
the Guarantors or any other Person, whether or not in accordance
with the terms of this Agreement, such Borrower or Guarantor or
other Person shall be deemed to hold the same in trust for the
benefit of Agent and promptly forward them to Wachovia or other
Approved Depositary. Subject to the provisions of clauses (ii)
and (iii) below, all amounts held by Approved Depositaries may be
transferred to the Borrower's or Guarantor's operating account in
the ordinary course of business.
(ii) If at any time Excess Borrowing Availability is less
than $30,000,000, the provisions of this clause (ii) shall become
applicable and shall be maintained thereafter, regardless of
subsequent changes in Excess Borrowing Availability above
$30,000,000. Promptly upon Excess Borrowing Availability becoming
less than $30,000,000, the Borrower and each relevant Guarantor
will open a lockbox with the Agent (or at the option of the
Agent, the Agent shall be given exclusive control of the existing
lockbox or lockboxes) and the Agent shall
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notify Wachovia and all other Approved Depositaries to remit
balances in deposit accounts maintained by them to the Agent. The
Agent will remove from such lockboxes and deposit all such items
of payment received from Account Debtors and all amounts received
from Approved Depositaries into a Collateral Reserve Account
promptly upon receipt, and, subject to clause (iii) below, the
Agent shall apply the proceeds from such items of payment against
the Revolving Loans first, then otherwise in accordance with the
proviso contained in SECTION 2.12(i) (except that cash collateral
for Letter of Credit Obligations shall not be required unless an
Event of Default has occurred and is continuing), with any
remaining collected amounts in each Collateral Reserve Account
being transferred by the Agent on each Domestic Business Day to
the Borrower's operating account; provided, that Net
Casualty/Insurance Proceeds shall be held subject to the
provisions of SECTION 5.08(b), and any Net Casualty/Insurance
Proceeds not required to be paid to the Agent for the account of
the Lenders pursuant to SECTION 5.08(b) shall be paid to the
Borrower or Guarantor on the date such payment is made for the
account of the Lenders.
(iii) During the existence of an Event of Default the Agent
may at any time in its commercially reasonable judgment or if
requested in writing by the Required Lenders, direct Account
Debtors to make payments on the Borrower's and Guarantors'
Accounts, Chattel Paper, or General Intangibles, or portions
thereof, directly to the Agent, and the Account Debtors are
hereby authorized and directed to do so by the Borrower and each
Guarantor upon the Agent's direction, and the funds so received
shall be also deposited in a Collateral Reserve Account, and all
amounts in a Collateral Reserve Account shall be subject to the
provisions of SECTION 2.12(j).
(b) The Borrower and the Guarantors shall not open any Deposit
Account with any depositary institution (except with the Agent and subject
to the Liens created by this Agreement) unless the depository institution
constitutes an Approved Depositary and it shall have entered into a Deposit
Account Control Agreement with the Agent. As of the Closing Date, the
Borrower and the Guarantors have no Deposit Accounts other than those
listed in the Collateral Disclosure Certificates.
(c) The Borrower and the Guarantors shall not open any securities
account with any securities intermediary (except with the Agent and subject
to the Liens created by this Agreement) unless the securities intermediary
constitutes an Approved Securities Intermediary and it shall have entered
into a Securities Account Control Agreement with the Agent. As of the
Closing Date, the Borrower and the Guarantors have no securities accounts
other than those listed in the Collateral Disclosure Certificates.
SECTION 2.16. Issuance of Letters of Credit. Subject to the terms
and conditions of this Agreement, and in reliance upon the representations
and warranties of the Borrower and the Guarantors herein set forth, the LC
Issuer shall issue for the account of the Borrower, one or more Letters of
Credit denominated in Dollars, in accordance with this ARTICLE 2, from time
to time during the period commencing on the Closing Date and ending on the
Domestic Business Day prior to the Termination Date.
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SECTION 2.17. Conditions and Amounts of Letters of Credit. The LC
Issuer shall have no obligation to issue any Letter of Credit at any time:
(a) if the aggregate maximum amount then available for drawing
under Letters of Credit, after giving effect to the issuance of the
requested Letter of Credit, shall exceed any limit imposed by law or
regulation upon the LC Issuer;
(b) if, after giving effect to the issuance of the requested
Letter of Credit, (i) the aggregate Letter of Credit Obligations would
exceed $20,000,000 or (ii) all of the then outstanding Revolving Loans
would exceed the Borrowing Base;
(c) which has an expiration date (i) more than 1 year after the
date of issuance or (ii) after the Termination Date;
(d) unless the Borrower shall have delivered to the LC Issuer at
such times and in such manner as the LC Issuer may prescribe, a Letter of
Credit Application Agreement and such other documents and materials as may
be required pursuant to the terms thereof all satisfactory in form and
substance to the LC Issuer and the terms of the proposed Letter of Credit
shall be satisfactory in form and substance to the LC Issuer;
(e) if, as of the date of issuance any order, judgment or decree
of any court, arbitrator or Authority shall purport by its terms to enjoin
or restrain the LC Issuer from issuing the Letter of Credit and any law,
rule or regulation applicable to the LC Issuer and any request or directive
(whether or not having the force of law) from any Authority with
jurisdiction over the LC Issuer shall prohibit or request that the LC
Issuer refrain from the issuance of letters of credit generally or the
issuance of that Letter of Credit; and
(f) if, the Unused Commitment shall be less than the amount of
the requested Letter of Credit.
SECTION 2.18. Requests for Issuance of Letters of Credit.
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(a) Request for Issuance. At least two Domestic Business Days
before the effective date for any Letter of Credit, the Borrower shall give
the LC Issuer a written notice containing the original signature of an
authorized officer or employee of the Borrower substantially in the form of
EXHIBIT P-1. Such notice shall be irrevocable and shall specify the
original face amount of the Letter of Credit requested (which original face
amount shall not be less than $100,000), the effective date (which day
shall be a Domestic Business Day) of issuance of such requested Letter of
Credit, the date on which such requested Letter of Credit is to expire, the
amount of then outstanding Letter of Credit Obligations, the purpose for
which such Letter of Credit is to be issued, whether such Letter of Credit
may be drawn in single or partial draws and the person for whose benefit
the requested Letter of Credit is to be issued.
(b) Issuance; Notice of Issuance. If the original face amount of
the requested Letter of Credit is less than or equal to the Unused
Commitment at such time and the applicable conditions set forth in this
Agreement are satisfied, the LC Issuer shall issue the requested Letter of
Credit. The LC Issuer shall give each Lender written or telex notice in
substantially the form
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of EXHIBIT P-2, or telephonic notice confirmed promptly thereafter in
writing, of the issuance of a Letter of Credit.
(c) No Extension or Amendment. The LC Issuer shall not extend or
amend any Letter of Credit if the issuance of a new Letter of Credit having
the same terms as such Letter of Credit as so amended or extended would be
prohibited by SECTION 2.17 or SECTION 2.18.
SECTION 2.19. Letter of Credit Reimbursement Obligations; Duties
of the LC Issuer.
(a) Reimbursement. Notwithstanding any provisions to the contrary
in any Letter of Credit Application Agreement:
(i) the Borrower shall reimburse the LC Issuer for drawings
under a Letter of Credit issued by it no later than the earlier
of (A) the time specified in such Letter of Credit Application
Agreement, or (B) 1 Domestic Business Day after the payment by
the LC Issuer;
(ii) any Reimbursement Obligation with respect to any Letter
of Credit shall bear interest from the date of the relevant
drawing under the pertinent Letter of Credit until the date of
payment in full thereof at a rate per annum equal to (A) prior to
the date that is 3 Domestic Business Days after the date of the
related payment by the LC Issuer, the Base Rate and (B)
thereafter, the Default Rate; and
(iii) to implement the foregoing, upon the occurrence of a
draw under any Letter of Credit, unless the LC Issuer is
reimbursed in accordance with subsection (i) above, the Borrower
irrevocably authorizes the Agent to treat such nonpayment as a
Notice of Borrowing in the amount of such Reimbursement
Obligation and to make Revolving Loans to Borrower in such amount
regardless of whether the conditions precedent to the making of
Revolving Loans hereunder have been met. The Borrower further
authorizes the Agent to credit the proceeds of such Revolving
Loan so as to immediately eliminate the liability of the Borrower
for Reimbursement Obligations under such Letter of Credit.
(b) Duties of the LC Issuer. Any action taken or omitted to be
taken by the LC Issuer in connection with any Letter of Credit, if taken or
omitted in the absence of willful misconduct or gross negligence, shall not
put the LC Issuer under any resulting liability to any Lender, or assuming
that the LC Issuer has complied with the procedures specified in SECTION
2.18 and such Lender has not given a notice contemplated by SECTION 2.20(a)
that continues in full force and effect, relieve that Lender of its
obligations hereunder to the LC Issuer. In determining whether to pay under
any Letter of Credit, the LC Issuer shall have no obligation relative to
the Agent or the Lenders other than to confirm that any documents required
to have been delivered under such Letter of Credit appear to comply on
their face, with the requirements of such Letter of Credit.
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SECTION 2.20. Letter of Credit Participations.
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(a) Purchase of Participations. Immediately upon issuance of any
Letter of Credit in accordance with the procedures set forth in SECTION
2.17, each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the LC Issuer, without recourse or warranty, an
undivided interest and participation, to the extent of such Lender's
Commitment Percentage of such Letter of Credit (or guaranty pertaining
thereto); provided, that a Letter of Credit shall not be entitled to the
benefits of this SECTION 2.20 if the Agent and the LC Issuer shall have
received written notice from any Lender on or before the Domestic Business
Day immediately prior to the date of the LC Issuer's issuance of such
Letter of Credit that one or more of the conditions contained in SECTION
2.18 or ARTICLE 4 is not then satisfied, and, in the event the Agent and
the LC Issuer receives such a notice, it shall have no further obligation
to issue any Letter of Credit until such notice is withdrawn by that Lender
or until the Required Lenders have effectively waived such condition in
accordance with the provisions of this Agreement.
(b) Sharing of Letter of Credit Payments. In the event that the
LC Issuer makes any payment under any Letter of Credit for which the
Borrower shall not have repaid such amount to the LC Issuer pursuant to
SECTION 2.21 or which cannot be paid by a Revolving Loan pursuant to
SECTION 2.18(a)(iii), the LC Issuer shall notify the Agent and the Agent
shall promptly notify each Lender of such failure, and each Lender shall
promptly and unconditionally pay to the LC Issuer such Lender's Commitment
Percentage of the amount of such payment in Dollars and in same day funds.
If the Agent so notifies such Lender prior to 10:00 A.M. (Charlotte, North
Carolina, time) on any Domestic Business Day, such Lender shall make
available to the LC Issuer its Commitment Percentage of the amount of such
payment on such Domestic Business Day in same day funds. If and to the
extent such Lender shall not have so made its Commitment Percentage of the
amount of such payment available to the LC Issuer, such Lender agrees to
pay to the LC Issuer forthwith on demand such amount together with interest
thereon, for each day from the date such payment was first due until the
date such amount is paid to the LC Issuer at the Federal Funds Rate for the
first 3 days and thereafter at the Base Rate. The failure of any Lender to
make available to the LC Issuer its Commitment Percentage of any such
payment shall neither relieve nor increase the obligation of any other
Lender hereunder to make available to the LC Issuer its Commitment
Percentage of any payment on the date such payment is to be made.
(c) Sharing of Reimbursement Obligation Payments. Whenever the LC
Issuer receives a payment on account of a Reimbursement Obligation,
including any interest thereon, as to which the LC Issuer has received any
payments from the Lenders pursuant to this SECTION 2.20, it shall promptly
pay to each Lender which has funded its participating interest therein, in
Dollars and in the kind of funds so received, an amount equal to such
Lender's Commitment Percentage thereof. Each such payment shall be made by
the LC Issuer on the Domestic Business Day on which the funds are paid to
such Person, if received prior to 10:00 am. (Charlotte, North Carolina,
time) on such Domestic Business Day, and otherwise on the next succeeding
Domestic Business Day.
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(d) Documentation. Upon the request of any Lender, the LC Issuer
shall furnish to such Lender copies of any Letter of Credit, Letter of
Credit Application Agreement and other documentation relating to Letters of
Credit issued pursuant to this Agreement.
(e) Obligations Irrevocable. The obligations of the Lenders to
make payments to the LC Issuer with respect to a Letter of Credit shall be
irrevocable, not subject to any qualification or exception whatsoever and
shall be made in accordance with, but not subject to, the terms and
conditions of this Agreement under all circumstances (assuming that the LC
Issuer has issued such Letter of Credit in accordance with SECTION 2.18 and
such Lender has not given a notice contemplated by SECTION 2.20(a) that
continues in full force and effect), including, without limitation, any of
the following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other
right which the Borrower may have at any time against a
beneficiary named in a Letter of Credit or any transferee of any
Letter of Credit (or any Person for whom any such transferee may
be acting), the LC Issuer, any Lender or any other Person,
whether in connection with this Agreement, any Letter of Credit,
the transactions contemplated herein or any unrelated
transactions;
(iii) any draft, certificate or any other document presented
under the Letter of Credit proves to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the
Credit Documents;
(v) payment by the LC Issuer 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;
(vi) payment by the LC Issuer under any Letter of Credit
against presentation of any draft or certificate that does not
comply with the terms of such Letter of Credit, except payment
resulting from the gross negligence or willful misconduct of the
LC Issuer; or
(vii) any other circumstances or happenings whatsoever,
whether or not similar to any of the foregoing, except
circumstances or happenings resulting from the gross negligence
or willful misconduct of the LC Issuer.
SECTION 2.21. Payment of Letter of Credit Reimbursement
Obligations.
(a) Payments to the LC Issuer. The Borrower agrees to pay to the
LC Issuer the amount of all Reimbursement Obligations, interest and other
amounts payable to the LC Issuer under or in connection with any Letter of
Credit issued for the Borrower's account immediately when due, irrespective
of:
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(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other
right which the Borrower may have at any time against a
beneficiary named in a Letter of Credit or any transferee of any
Letter of Credit (or any Person for whom any such transferee may
be acting), the LC Issuer, the Agent, any Lender or any other
Person, whether in connection with this Agreement, any Letter of
Credit, the transactions contemplated herein or any unrelated
transactions;
(iii) any draft, certificate or any other document presented
under the Letter of Credit proves to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the
Credit Documents;
(v) payment by the LC Issuer 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;
(vi) payment by the LC Issuer under any Letter of Credit
against presentation of any draft or certificate that does not
comply with the terms of such Letter of Credit, except payment
resulting from the gross negligence or willful misconduct of the
LC Issuer; or
(vii) any other circumstances or happenings whatsoever,
whether or not similar to any of the foregoing, except
circumstances or happenings resulting from the gross negligence
or willful misconduct of the LC Issuer.
(b) Recovery or Avoidance of Payments. In the event any payment
by or on behalf of the Borrower received by the LC Issuer with respect to a
Letter of Credit and distributed by the LC Issuer to the Lenders on account
of their participations is thereafter set aside, avoided or recovered from
the LC Issuer in connection with any receivership, liquidation or
bankruptcy proceeding, each Lender that received such distribution shall,
upon demand by the LC Issuer, contribute such Lender's Commitment
Percentage of the amount set aside, avoided or recovered together with
interest at the rate required to be paid by the LC Issuer upon the amount
required to be repaid by it.
SECTION 2.22. Compensation for Letters of Credit and Reporting
Requirements.
(a) Letter of Credit Commitment Fees. The Borrower shall pay to
the Agent with respect to each Letter of Credit issued hereunder a letter
of credit commitment fee ("Letter of Credit Commitment Fee") at a rate per
annum equal to the Applicable Margin for Euro-Dollar Loans times the daily
average of the undrawn amount of all outstanding Letters of Credit. Such
Letter of Credit Commitment Fee shall accrue from and including the Closing
Date to but excluding the Termination Date and shall be payable on the last
Business Day of each calendar
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quarter and on the Termination Date. Letter of Credit Commitment Fees
payable hereunder shall be computed on the basis of a year of 360 days and
paid for the actual number of days elapsed (including the first day but
excluding the last day). The Agent shall promptly remit such Letter of
Credit Commitment Fees, when paid, to the Lenders in accordance with their
Commitment Percentage thereof.
(b) Letter of Credit Fronting Fee. The Borrower shall pay to the
Agent with respect to each Letter of Credit issued hereunder a letter of
credit fronting fee ("Letter of Credit Fronting Fee") equal to 0.125% of
the face amount of such Letter of Credit, payable on the Domestic Business
Day on which such Letter of Credit is issued, solely for the account of the
LC Issuer. The Agent shall promptly remit such Letter of Credit Fronting
Fee, when paid, to the LC Issuer.
(c) LC Issuer Charges. The Borrower shall pay to the LC Issuer,
solely for its own account, the standard charges assessed by the LC Issuer
in connection with the issuance, administration, amendment and payment or
cancellation of Letters of Credit issued hereunder, which charges shall be
those typically charged by the LC Issuer to its customers generally having
credit and other characteristics similar to the Borrower, as determined in
good faith by the LC Issuer.
SECTION 2.23. Indemnification and Exoneration with respect to
Letters of Credit.
(a) Indemnification. In addition to amounts payable as elsewhere
provided in this Article 2, the Borrower shall protect, indemnify, pay and
save the LC Issuer, the Agent and each Lender harmless from and against any
and all claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees) which the LC Issuer, the
Agent or any Lender may incur or be subject to as a consequence of the
issuance of any Letter of Credit for the Borrower's account other than as a
result of its gross negligence or willful misconduct, as determined by a
court of competent jurisdiction.
(b) Assumption of Risk by the Borrower. As between the Borrower,
the LC Issuer, the Agent and the Lenders, the Borrower assumes all risks of
the acts and omissions of, or misuse of the Letters of Credit issued for
the Borrower's account by, the respective beneficiaries of such Letters of
Credit. In furtherance and not in limitation of the foregoing, the LC
Issuer, the Agent and the Lenders shall not be responsible for (i) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
issuance of the Letters of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or
forged, (ii) 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 reason, (iii) failure
of the beneficiary of a Letter of Credit to comply duly with conditions
required to draw upon such Letter of Credit, (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by
mail, cable, telegraph, telex or otherwise, whether or not they be in
cipher, for errors in interpretation of technical terms, (v) any loss or
delay in the transmission or otherwise of any document required to make a
drawing under any Letter of Credit or of the proceeds thereof, (vi) the
misapplication by the
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beneficiary of a Letter of Credit of the proceeds of any drawing under such
Letter of Credit; and (vii) any consequences arising from causes beyond the
control of the LC Issuer, the Agent and the Lenders, but in any case with
respect to any of the foregoing, only to the extent not resulting from the
gross negligence or willful misconduct of the LC Issuer.
(c) Exoneration. In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth, any action
taken or omitted by the LC Issuer under or in connection with the Letters
of Credit or any related certificates if taken or omitted in good faith and
with reasonable care, shall not put the LC Issuer or any Lender under any
resulting liability to the Borrower or relieve the Borrower of any of its
obligations hereunder to any such Person.
ARTICLE 3
COLLATERAL
SECTION 3.01. Grant of Security Interest. As security for the
payment of all Obligations, the Borrower and each Guarantor (by execution
and delivery of the Guaranty) hereby grants, assigns, conveys, mortgages,
pledges, hypothecates and transfers to Agent, for itself and the ratable
benefit of the Lenders, a continuing, general lien upon and security
interest in and to all of its right, title and interest in, to and under
the following, whether now owned by or owing to, or hereafter acquired by
or arising in favor of the Borrower or such Guarantor (including under any
trade names, styles or derivations thereof), and whether owned or consigned
by or to, or leased from or to, the Borrower or such Guarantor, and
regardless of where located, including, without limitation:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Documents;
(d) all General Intangibles;
(e) all Inventory;
(f) all Equipment;
(g) all Fixtures;
(h) all Goods;
(i) all Instruments;
(j) all Investment Property;
(k) all Deposit Accounts;
(l) all money, cash, and cash equivalents;
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(m) all Supporting Obligations;
(n) all Letter of Credit Rights;
(o) all Commercial Tort Claims;
(p) to the extent not otherwise covered by or specifically
excluded from any of the foregoing, all of its other personal property and
assets; and
(q) to the extent not otherwise include above, all Proceeds, tort
claims, insurance claims, and other rights to payments not otherwise
included in the foregoing, all products of the foregoing, all accessions
to, substitutions and replacements for, and rents, leases, and profits of,
each of the foregoing.
SECTION 3.02. Further Assurances. At any time and from time to
time, upon the written request of the Agent, and at the sole expense of the
Borrower and the Guarantors, the Borrower and the Guarantors will promptly
and duly execute and deliver, and have recorded, such further instruments
and documents and take such further actions as the Agent may reasonably
request for the purpose of perfecting the assignments and security
interests granted hereunder and obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted, including,
without limitation, (a) filing any financing or continuation statements
under the Uniform Commercial Code (or other similar laws) in effect in any
jurisdiction with respect to the security interests created hereby, (b) in
the case of Investment Property, Deposit Accounts, Electronic Chattel
Paper, Letter of Credit Rights and any other relevant Collateral, taking
any actions requested by the Agent to enable the Agent to obtain "control"
(within the meaning of the applicable Uniform Commercial Code) with respect
thereto; provided, however, that in any event, and without any specific
request therefor, the Borrower and the Guarantors shall deliver to the
Agent on the Closing Date or promptly upon receipt thereof, if later, all
Pledged Notes in a principal amount of $1,000,000 or more, (c) causing the
Agent's name to be noted as secured party on any certificate of title for a
titled good if such notation is reasonably deemed necessary or advisable by
the Agent for the attachment, perfection or priority of, or the ability of
the Agent to enforce or realize on, the Agent's security interest in such
Collateral, (d) complying with any requirements of law (including the
Federal Assignment of Claims Act) as to any Collateral if such compliance
is reasonably deemed necessary or advisable by the Agent for the
attachment, perfection or priority of, or the ability of the Agent to
enforce, the Agent's security interest in such Collateral, (e) other than
with respect to agreements relating to OFS BrightWave, using commercially
reasonable efforts to obtain consents and approvals from any governmental
authority or other Person, including without limitation any consent of any
licensor, lessor or other Person obligated on Collateral, provided that the
Borrower and the Guarantors shall not be required to seek to obtain any
consent or approval to permit a Lien in favor of the Agent upon any
Excluded Equipment, (f) executing and delivering such documents,
agreements, invoice, document of title, dock warrant, dock receipt,
warehouse receipt, ▇▇▇▇ of lading, order, and instruments as may be
reasonably required by the Agent to further evidence and perfect its
security interests in the Collateral, (g) using commercially reasonable
efforts to obtain waivers from mortgagees, landlords and repairmen in form
and substance reasonably satisfactory to the Agent, and (h) taking all
actions required by the Uniform Commercial Code or by other
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law, as applicable in any relevant Uniform Commercial Code jurisdiction, or
by other law as applicable in any foreign jurisdiction. The Borrower shall
perform or cause to be performed such acts as the Agent may reasonably
request to establish and maintain for the Agent a valid and perfected
security interest in and to the Collateral, free and clear of any Liens
other than Permitted Liens. The Borrower hereby acknowledges that it
authorized the Agent to file financing statements relating hereto prior to
the Closing Date and hereby ratifies the filing of such financing
statements prior to the Closing Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
The Borrower and each of the Guarantors (by execution and
delivery of the Guaranty) represents and warrants to the Agent and the
Lenders (the Parent and the Borrower each making such representations
and warranties as to itself and as to the Borrower and its
Subsidiaries, and each other Guarantor making such representations and
warranties as to itself only) that:
SECTION 4.01. Corporate Existence and Power. The Parent, the
Borrower and each other Subsidiary is a corporation or limited liability
company duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or formation, is duly
qualified to transact business in every jurisdiction where, by the nature
of its business, such qualification is necessary (except where the failure
to be so qualified would not be reasonably be expected to have a Material
Adverse Effect), and has all corporate powers and all governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted, except where any such failure to have all
required governmental licenses, authorizations, consents and approvals does
not have and would not reasonably be expected to cause a Material Adverse
Effect and would not impede any rights of the Agent with respect to the
Collateral.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of
this Agreement, the Notes and the other Credit Documents and by the
Guarantors of the Guaranty, the Contribution Agreement and the other Credit
Documents to which it is a party (a) are within the Borrower's and such
Guarantor's corporate or limited liability company powers, (b) have been
duly authorized by all necessary corporate or limited liability company
action, and have been executed on behalf of the Borrower or such Guarantor
by duly authorized officers, (c) require no action by or in respect of or
filing with, any governmental body, agency or official, (d) do not
contravene, or constitute a default under, any provision of applicable law
or regulation or of the Articles of incorporation or formation or by-laws
or operating agreement of the Borrower or such Guarantor or of any
judgment, injunction, order or decree, or material agreement or other
material instrument, binding upon the Borrower or any of the Subsidiaries,
and (e) do not result in the creation or imposition of any Lien on any
asset of the Borrower (except in favor of the Agent) or any of the
Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a valid
and binding agreement of the Borrower enforceable in accordance with its
terms, and the Notes and the other Credit Documents executed by the
Borrower, and the Guaranty, the Contribution Agreement and the other Credit
Documents executed by each Guarantor, when executed and delivered in
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accordance with this Agreement, will constitute valid and binding
obligations of the Borrower or such Guarantor, enforceable in accordance
with their respective terms, provided that the enforceability hereof and
thereof is subject in each case to general principles of equity and to
bankruptcy, insolvency and similar laws affecting the enforcement of
creditors' rights generally.
SECTION 4.04. Financial Information.
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(a) The (i) audited consolidated financial statements (including
the balance sheet and statements of income, shareholders' equity and cash
flows) of the Parent and its Consolidated Subsidiaries for the Fiscal Year
ending on December 31, 2001, and reported on by Deloitte & Touche LLP,
copies of which have been delivered to the Agent, and (ii) unaudited
consolidated financial statements (including the balance sheet and
statements of income, shareholders' equity and cash flows) of the Parent
and its Consolidated Subsidiaries for the interim period ended September
30, 2002, copies of which have been delivered to the Agent, fairly present
in all material respects, in conformity with GAAP, the consolidated
financial position of the Parent and its Consolidated Subsidiaries as of
such dates and their consolidated results of operations and cash flows for
such periods stated.
(b) Since December 31, 2001, except as disclosed in SCHEDULE
4.04, and except as disclosed in writing to the Agent after the Closing
Date, there has been no event, act, condition or occurrence having a
Material Adverse Effect.
SECTION 4.05. Litigation. Except as disclosed in SCHEDULE 4.05,
and except as disclosed in writing to the Agent after the Closing Date,
there is no action, suit or proceeding pending, or to the knowledge of the
Parent or the Borrower threatened, against or affecting the Parent, the
Borrower or any of the other Subsidiaries before any court or arbitrator or
any governmental body, agency or official which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect.
SECTION 4.06. Compliance with ERISA.
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(a) The Parent and each member of the Controlled Group have
fulfilled their obligations under the minimum funding standards of ERISA
and the Code with respect to each Plan and are in compliance in all
material respects with the presently applicable provisions of ERISA and the
Code, and have not incurred any liability to the PBGC or a Plan under Title
IV of ERISA.
(b) Neither the Parent nor any member of the Controlled Group is
or ever has been obligated to contribute to any Multiemployer Plan.
SECTION 4.07. Compliance with Laws; Payment of Taxes. The Parent,
the Borrower and the other Subsidiaries are in material compliance with all
applicable laws, regulations and similar requirements of governmental
authorities (including, without limitation, the Fair Labor Standards Act of
1938, as amended), except as set forth in SECTION 4.13 or as disclosed in
writing to the Agent after the Closing Date, or where such compliance is
being contested in good faith through appropriate proceedings, and except
where any such failure to comply (other than with respect to the Fair Labor
Standards Act of 1938, as amended) does not have and would not reasonably
be expected to cause a Material Adverse Effect and would not
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impede any rights of the Agent with respect to the Collateral. There have
been filed on behalf of the Parent, the Borrower and the other Subsidiaries
all Federal, state and material local income, excise, property and other
tax returns which are required to be filed by them and all taxes due
pursuant to such returns or pursuant to any assessment received by or on
behalf of the Parent, the Borrower or any other Subsidiary have been paid,
except where such payment is being contested in good faith by appropriate
proceedings. The charges, accruals and reserves on the books of the Parent,
the Borrower and the other Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Parent and the Borrower,
adequate. United States income tax returns of the Parent, the Borrower and
the other Subsidiaries for the periods through December 31, 1998 are no
longer subject to examination.
SECTION 4.08. Investment Company Act. Neither the Parent, the
Borrower nor any of the other Subsidiaries is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
SECTION 4.09. Public Utility Holding Company Act. Neither the
Parent, the Borrower nor any of the other Subsidiaries is a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.
SECTION 4.10. Ownership of Property; Liens. Each of the Parent,
the Borrower and the other Subsidiaries has title to its properties
sufficient for the conduct of its business, and none of such property is
subject to any Lien except Permitted Liens.
SECTION 4.11. No Default. Neither the Parent, the Borrower nor
any of the other Subsidiaries is in default under or with respect to any
agreement, instrument or undertaking to which it is a party or by which it
or any of its property is bound which could reasonably be expected to have
or cause a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
SECTION 4.12. Full Disclosure. All information heretofore
furnished in writing by the Parent, the Borrower or any Subsidiary
Guarantor to the Agent or any Lender for purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished in writing by the Parent, the Borrower or
any Subsidiary Guarantor to the Agent or any Lender will be, true, accurate
and complete in every material respect or based on reasonable estimates on
the date as of which such information is stated or certified.
SECTION 4.13. Environmental Matters. Except as disclosed in
SCHEDULE 4.13:
(a) To the knowledge of the Borrower, (i) neither the Parent, the
Borrower nor any other Subsidiary is subject to any Environmental Liability
which could reasonably be expected to have or cause a Material Adverse
Effect or, as to the Real Properties, create an Event of Default under
SECTION 6.01(m), and (ii) neither the Parent, the Borrower nor any other
Subsidiary has been notified or is otherwise aware that it has been
designated as a potentially
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responsible party under CERCLA or under any state statute similar to
CERCLA. None of the Real Properties or any other real property owned,
leased or operated by the Parent, the Borrower or any other Subsidiary
(collectively, the "Aggregate Real Properties") has been identified on any
current or proposed (x) National Priorities List under 40 C.F.R. ss. 300 or
(y) to the knowledge of the Borrower, CERCLIS list or any list arising from
a state statute similar to CERCLA.
(b) To the knowledge of the Borrower, no Hazardous Materials have
been or are being used, produced, manufactured, processed, treated,
recycled, generated, stored, disposed of, managed or otherwise handled at,
or shipped or transported to or from the Aggregate Real Properties or are
otherwise present at, on, in or under the Aggregate Real Properties, or, to
the best of the knowledge of the Parent, the Borrower and the Subsidiary
Guarantors, at or from any adjacent site or facility, except for Hazardous
Materials, such as cleaning solvents, pesticides and other materials used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed, or otherwise handled in the ordinary course of
business in substantial compliance with all applicable Environmental
Requirements, except where the failure to comply could not reasonably be
expected to have or cause a Material Adverse Effect or, as to the Real
Properties, create an Event of Default under SECTION 6.01(m).
(c) To the knowledge of the Borrower, the Parent, the Borrower
and each other Subsidiary has procured all material Environmental
Authorizations necessary for the conduct of its business, and is in
substantial compliance with all Environmental Requirements in connection
with the operation of the Aggregate Real Properties and the Parent's, the
Borrower's and each other Subsidiary's respective businesses, except to the
extent such non-procurement or non-compliance could reasonably be expected
to have or cause a Material Adverse Effect or, as to the Real Properties,
create an Event of Default under SECTION 6.01(m).
SECTION 4.14. Capital Stock. All Capital Stock, Redeemable
Preferred Stock, debentures, bonds, notes and all other securities of the
Parent, the Borrower and the other Subsidiaries presently issued and
outstanding are validly and properly issued in accordance with all
applicable laws, including, but not limited to, the "Blue Sky" laws of all
applicable states and the federal securities laws, or for which the
applicable statute of limitations has expired. The issued shares of Capital
Stock and Redeemable Preferred Stock of the Parent's Wholly Owned
Subsidiaries are owned directly or indirectly by the Parent, free and clear
of any Lien or adverse claim, other than Liens in favor of the Agent. At
least a majority of the issued shares of capital stock of each of the
Parent's other Subsidiaries (other than Wholly Owned Subsidiaries) is owned
directly or indirectly by the Parent free and clear of any Lien or adverse
claim, other than Liens in favor of the Agent.
SECTION 4.15. Margin Stock. Neither the Parent, the Borrower nor
any Subsidiaries is engaged principally, or as one of its important
activities, in the business of purchasing or carrying any Margin Stock, and
no part of the 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 be used for any purpose which violates, or
which is inconsistent with, the provisions of Regulation T, U or X.
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SECTION 4.16. Insolvency. After giving effect to the execution
and delivery of the Credit Documents and the incurrence of the Obligations
under this Agreement: (a) neither the Parent, the Borrower nor any
Subsidiary Guarantor will (i) be "insolvent," within the meaning of such
term as defined in ss. 101 of the Bankruptcy Code, or SECTION 2 of either
the "UFTA" or the "UFCA", or as defined or used in any "Other Applicable
Law" (as those terms are defined below), or (ii) be unable to pay its debts
generally as such debts become due within the meaning of SECTION 548 of the
Bankruptcy Code, SECTION 4 of the UFTA or SECTION 6 of the UFCA, or (iii)
have an unreasonably small capital to engage in any business or
transaction, whether current or contemplated, within the meaning of SECTION
548 of the Bankruptcy Code, SECTION 4 of the UFTA or SECTION 5 of the UFCA;
and (b) the Obligations of the Borrower and the Guarantors under the Credit
Documents to which they are party will not be rendered avoidable under any
Other Applicable Law. For purposes of this SECTION 4.16, "UFTA" means the
Uniform Fraudulent Transfer Act, "UFCA" means the Uniform Fraudulent
Conveyance Act, and "Other Applicable Law" means any other applicable law
pertaining to fraudulent transfers or acts voidable by creditors, in each
case as such law may be amended from time to time.
SECTION 4.17. Insurance. The Parent, the Borrower and of the
other Subsidiaries have (either in the name of the Parent, the Borrower or
in such other Subsidiary's own name), with financially sound and reputable
insurance companies and with a Best's Rating of at least "A", insurance in
at least such amounts and against at least such risks (including on all its
property, and business interruption, public liability and worker's
compensation, to the extent not self insured as to worker's compensation)
as are usually insured against in the same general area by companies of
established repute engaged in the same or similar business.
SECTION 4.18. Purchase of Collateral. Within the 12 months period
preceding the Closing Date, neither the Borrower nor any Guarantor has
purchased any of the Collateral consisting of goods in a bulk transfer or
in a transaction which was outside the ordinary course of the business of
the Borrower's or such Guarantor's seller.
SECTION 4.19. Possession of Permits. The Parent, the Borrower and
each other Subsidiary possess all franchises, certificates, licenses,
permits and other authorizations from governmental political subdivisions
or regulatory authorities, and all patents, trademarks, service marks,
trade names, copyrights, licenses and other rights, free from burdensome
restrictions, that are necessary for the ownership, maintenance and
operation of any of its properties and assets, and no Borrower or
Subsidiary is in violation of any thereof except where any such failure to
possess any of the foregoing does not have and would not reasonably be
expected to cause a Material Adverse Effect and would not impede any rights
of the Agent with respect to the Collateral.
SECTION 4.20. Labor Disputes. Except as disclosed in writing to
the Agent after the Closing Date, there is (a) no collective bargaining
agreement or other labor contract covering employees of the Parent, the
Borrower or any other Subsidiary, (b) no such collective bargaining
agreement or other labor contract is scheduled to expire during the term of
this Agreement, (c) no union or other labor organization is seeking to
organize, or to be recognized as, a collective bargaining unit of employees
of Parent, the Borrower or any other Subsidiary or for any similar purpose
and (d) no pending, or to the Parent's, the Borrower's and each Guarantor's
knowledge, threatened, strike, work stoppage, material unfair labor
practice claim, or
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other material labor dispute against or affecting the Parent, the Borrower
or any other Subsidiary or their respective employees.
SECTION 4.21. Surety Obligations. Except as shown on SCHEDULE
4.21, and except as disclosed in writing to the Agent after the Closing
Date, none of the Parent, the Borrower nor any of the other Subsidiaries is
obligated as surety or indemnitor under any surety or similar bond or other
contract issued or entered into to assure payment, performance or
completion of performance of any undertaking or obligation of any Person.
SECTION 4.22. Restrictions. None of the Parent, the Borrower nor
any of the other Subsidiaries is a party or subject to any contract,
agreement, or charter or other corporate restriction, which materially and
adversely affects its business or the use or ownership of any of its
assets. Except as set forth on SCHEDULE 4.22, and except as disclosed in
writing to the Agent after the Closing Date, none of the Parent, the
Borrower nor any of the other Subsidiaries is a party or subject to any
contract or agreement which restricts its right or ability to incur Debt,
none of which prohibit the execution of or compliance with this Agreement
or the other Credit Documents by the Parent, the Borrower or any of the
other Subsidiaries, as applicable.
SECTION 4.23. Leases. SCHEDULE 4.23 is a complete listing of all
capitalized and operating leases of the Parent, the Borrower and the other
Subsidiaries on the date hereof providing for annual payments in excess of
$100,000. Each of the Parent, the Borrower and the other Subsidiaries is in
compliance in all material respects with all of the terms of each of its
respective capitalized and operating leases listed on such Schedule.
SECTION 4.24. Trade Relations. As of the Closing Date, and except
as disclosed in writing to the Agent after the Closing Date, (i) there
exists no present condition or state of facts or circumstances which
reasonably could be expected to materially adversely affect the Parent, the
Borrower or any of the other Subsidiaries or prevent the Parent, the
Borrower or any of the other Subsidiaries from conducting its business
after the consummation of the transactions contemplated by this Agreement
in substantially the same manner in which they have heretofore been
conducted, and, (ii) to the best of the Borrower's and the Guarantors'
knowledge, there exists no actual or threatened termination, cancellation
or limitation of, or any modification or change in, the business
relationship between the Parent, the Borrower or any of the other
Subsidiaries and any customer or any group of customers whose purchases
individually or in the aggregate are material to the business of the
Parent, the Borrower or any of the other Subsidiaries, or with any material
supplier.
SECTION 4.25. Capital Structure. As of the date hereof, SCHEDULE
4.25 states (a) the correct name of the Parent, the Borrower and each of
the other Subsidiaries, its jurisdiction of incorporation or formation and
(except as to the Parent) the percentage of its Capital Stock and
Redeemable Preferred Stock owned by the Parent, the Borrower and each of
the other Subsidiaries, (b) the name of each of the Parent's and the
Borrower's Affiliates and the nature of such affiliation, (c) the number,
nature and holder of all Capital Stock and Redeemable Preferred Stock of
the Borrower and the other Subsidiaries, and (d) the number of authorized,
issued and treasury shares of the Borrower and the other Subsidiaries. The
Parent, the Borrower and the other Subsidiaries have good title to all of
the shares they purport to own of the Capital Stock and Redeemable
Preferred Stock of each of the Borrower and the other Subsidiaries, free
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and clear in each case of any Lien other than Permitted Encumbrances. All
such shares have been duly issued and are fully paid and non-assessable.
SECTION 4.26. Article 9 Information. The Borrower's and each
Guarantor's federal taxpayer identification number and organizational
identification number are correctly listed on such Borrower's or
Guarantor's Collateral Disclosure Certificate. For the Borrower and each
Guarantor, the jurisdiction of incorporation or organization, type of
organization, exact legal name, federal taxpayer identification number,
organizational identification number issued by its state of incorporation
or organization, and the location of such Borrower's or Guarantor's
Executive Office or sole place of business is specified correctly in such
Borrower's or Guarantor's Collateral Disclosure Certificate.
SECTION 4.27. Accounts. Each right to payment which the Borrower
or any Guarantor claims or asserts is an "Account" in any Borrowing Base
Certificate is, or will be at the time of creation, legally enforceable
against the respective Account Debtor and would constitute an "Account" as
such term is defined herein (except as may be disclosed in such Borrowing
Base Certificate).
(a) The amounts represented by the Borrower or any Guarantor to
the Agent from time to time as owing to the Borrower or such Guarantor in
respect of the Accounts will at such times be accurate in all material
respects.
(b) No amount payable to the Borrower or any Guarantor under or
in connection with any Account in an amount exceeding $50,000 is evidenced
by any Instrument or Chattel Paper which has not been delivered to the
Agent, or if such Chattel Paper constitutes Electronic Chattel Paper, over
which the Agent has control.
SECTION 4.28. Good Title to Collateral. The Borrower and the
Guarantors have good title to the Collateral free and clear of all Liens,
other than any Permitted Encumbrances, and no assertable financing
statement covering the Collateral is on file in any public office other
than any evidencing Permitted Encumbrances.
SECTION 4.29. Right to Assign and Grant Security Interest. The
Borrower and each of the Guarantors has full right, power and authority to
assign the Accounts pursuant to this Agreement and to grant a security
interest in all of the Collateral.
SECTION 4.30. Trade Styles.
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Except as may be set forth on the Collateral Disclosure
Certificates, neither the Borrower nor any Guarantor uses any trade names
or trade styles (herein, "Trade Styles") in their business operations and
warrant that the same shall continue, except for any additional Trade
Styles after the date hereof with respect to which the Borrower or such
Guarantor has given the Agent at least 30 days prior written notice
thereof. In any event, to the extent that, now or hereafter, the Borrower
or any Guarantor uses any Trade Styles, the Borrower and the Guarantors
hereby represent and warrant in favor of the Agent that:(a) all of the
Accounts and Proceeds with respect thereto arising out of sales under the
Trade Styles shall be the property of, and belong to, the Borrower or such
Guarantor and shall constitute Accounts as such term is defined herein; (b)
each of the Trade Styles is a trade name and trade style (and not an
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independent corporation or other legal entity) by which the Borrower or
such Guarantor identifies and sells certain of its products or services and
under which it may conduct a portion of its business; (c) all Accounts,
Proceeds thereof, and returned merchandise which arise from the sale of
products invoiced under the names of any of the Trade Styles shall be owned
solely by the Borrower or a Guarantor and shall be subject to the terms of
this Agreement as they relate to Accounts and the Collateral; and (d) the
Borrower and each Guarantor hereby appoints the Agent as its
attorney-in-fact to file such certificates disclosing the Borrower's or
such Guarantor's use of the Trade Styles and to take such other actions on
its behalf as are necessary to comply with the statutes of any states
relating to the use of fictitious or assumed business names, to the extent
that the Borrower or such Guarantor fails to do so after notice and
reasonable opportunity to comply.
SECTION 4.31. Farm Products.
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None of the Collateral constitutes, or is the Proceeds of, Farm
Products.
SECTION 4.32. Investment Property.
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(a) The Borrower's and each Guarantor's Pledged Interests
constitute all of the issued and outstanding Equity Interests of each
Person owned by the Borrower or such Guarantor (except in the case of
Foreign Subsidiaries, as limited in accordance with the definition of
"Pledged Interests" herein). All of the Pledged Interests owned by the
Borrower of any Guarantor are represented by the certificates listed in the
Borrower's or such Guarantor's Collateral Disclosure Certificate.
(b) The Borrower's and each Guarantor's Pledged Interests have
been duly and validly issued and are fully paid and nonassessable. There is
no amount or other obligation owing by the Borrower or any Guarantor to any
issuer of such Pledged Interests in exchange for or in connection with the
issuance of the Pledged Interests or the Borrower's or such Guarantor's
status as a stockholder, member, or partner of any such issuer.
(c) Each of the Pledged Notes constitutes the legal, valid and
binding obligation of the obligor with respect thereto, enforceable in
accordance with its terms, subject to the effects of bankruptcy, insolvency
and reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law).
(d) The Borrower or a Guarantor is the record and beneficial
owner of, and has good title to, the Pledged Interests and Pledged Notes
pledged by it hereunder, free of any and all Liens or options in favor of,
or claims of, any other Person, except for Liens in favor of the Agent.
SECTION 4.33. Intellectual Property.
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(a) All Intellectual Property owned by the Borrower and each
Guarantor as of the Closing Date is listed on such Borrower's or
Guarantor's Collateral Disclosure Certificate.
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(b) All material Intellectual Property of the Borrower and each
Guarantor is valid, subsisting, unexpired and enforceable, has not been
abandoned and does not infringe the intellectual property rights of any
other Person.
(c) As of the Closing Date, and except as disclosed in writing
the Agent after the Closing Date, none of the Borrower's nor any
Guarantor's material Intellectual Property is the subject of any licensing
or franchise agreement pursuant to which the Borrower or such Guarantor is
the licensor or franchisor, except as shown on the Borrower's or
Guarantor's Collateral Disclosure Certificate.
(d) No holding, decision or judgment has been rendered by any
governmental authority or arbitrator which would limit, cancel or question
the validity of, or the Borrower's or any Guarantor's rights in, any
material Intellectual Property in any respect.
(e) No action or proceeding is pending, or, to the knowledge of
the Borrower and the Guarantors, threatened, on the date hereof seeking to
limit, cancel or question the validity of any material Intellectual
Property of the Borrower or any Guarantor or the Borrower's or such
Guarantor's ownership interest therein.
SECTION 4.34. Account Debtor Capacity and Solvency. As of the
Closing Date, and except as disclosed in writing to the Agent after the
Closing Date, to the knowledge of the Borrower, each Account Debtor (a) had
the capacity to contract at the time any contract or other document giving
rise to the Account was executed and (b) such Account Debtor was not and is
not "insolvent" as that term is defined in SECTION 4.16.
SECTION 4.35. Proceedings with Respect to Accounts. Except as
previously disclosed in writing to the Agent and the Lenders or as publicly
disclosed by the Parent in its filings with the Securities and Exchange
Commission prior to the Closing Date, and except as disclosed in writing to
the Agent after the Closing Date, to the knowledge of the Borrower, there
are no proceedings or actions which are threatened or pending against any
Account Debtor whose business is material to the Borrower and its
Subsidiaries taken as a whole which are reasonably likely to have a
material adverse change in such Account Debtor's financial condition or the
collectibility of Accounts owing by it to the Borrower or any Guarantor.
SECTION 4.36. Location of Collateral. As of the Closing Date, and
except as disclosed in writing to the Agent after the Closing Date, the
Collateral consisting of goods of the Borrower and the Guarantors is
situated only at one or more of the Collateral Locations, except for goods
in transit and inventory being processed off-site, in each case in the
ordinary course of business. The Borrower and each Guarantor has exclusive
possession and control over the Equipment and Inventory owned by it,
subject to rights (if any) of holders of Permitted Encumbrances.
SECTION 4.37. Inventory.
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All of the Borrower's and each Guarantor's Inventory has been
produced in compliance in all material respects with all requirements of
the Fair Labor Standards Act.
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SECTION 4.38. Material Contracts. As of the Closing Date, and
except as disclosed in writing to the Agent after the Closing Date, the
Borrower's and each Guarantor's Material Contracts are listed on the
Borrower's or such Guarantor's Collateral Disclosure Certificate. . As of
the Closing Date, and except as disclosed in writing the Agent after the
Closing Date, the Borrower and each Guarantor is in compliance in all
material respects with all terms and provisions of each Material Contract.
SECTION 4.39. Survival of Representations and Warranties. The
Borrower and each of the Guarantors covenant, warrant and represent to the
Agent and each Lender that all representations and warranties of the
Borrower and the Guarantors contained in this Agreement or any of the other
Credit Documents shall be true on the Closing Date and at the time of each
Borrowing or issuance of a Letter of Credit (except to the extent any such
representation or warranty is expressly stated to have been made as of a
specific earlier date) and shall survive the execution, delivery and
acceptance thereof by Agent and the parties thereto and the closing of the
transactions described therein or related thereto.
SECTION 4.40. Force Majeure. None of the Borrower's nor any
Guarantor's business is suffering from effects of fire, accident, strike,
drought, storm, earthquake, embargo, tornado, hurricane, act of God, acts
of a public enemy or other casualty that would reasonably be likely to have
a Material Adverse Effect.
ARTICLE 5
COVENANTS
The Borrower and each of the Guarantors (by execution and
delivery of the Guaranty) agree that, so long as any Lender has any
Commitment hereunder or any amount payable hereunder or any of the
Obligations (other than contingent obligations not then due and owing)
remains unpaid (the Parent and the Borrower each making such covenants as
to itself and as to the Borrower and its Subsidiaries, and each other
Guarantor making such covenants as to itself only):
SECTION 5.01. Information. The Parent, the Borrower or the
Subsidiary Guarantors, as applicable, will deliver to each of the Lenders:
(a) as soon as available and in any event within 90 days after
the end of each Fiscal Year, (i) audited consolidated financial statements
(including the balance sheet and statements of income, shareholders' equity
and cash flows) of the Parent and its Consolidated Subsidiaries, certified
by the Certified Public Accountants, with such certification to be free of
limitation as to scope of audit or qualification as to going concern, and
(ii) unaudited consolidating financial statements (including the balance
sheet and statement of income) of the Parent and all Subsidiaries, in each
case as of the end of such Fiscal Year, setting forth in each case in
comparative form the figures for the previous fiscal year (such annual
financial statements may be furnished by furnishing to the Lenders the Form
10-K for such Fiscal Year filed with the Securities and Exchange
Commission);
(b) as soon as available and in any event within 50 days after
the end of each of the first three Fiscal Quarters of each Fiscal Year,
consolidated financial statements (including
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the balance sheet and statements of income, shareholders' equity and cash
flows) of the Parent and its Consolidated Subsidiaries, as of the end of
such Fiscal Quarter, and for the portion of the Fiscal Year ending on such
date, setting forth in comparative form the figures for the corresponding
Fiscal Quarter and the corresponding portion of the previous Fiscal Year
and in comparison to the projections furnished pursuant to SECTION 5.01(f),
all certified (subject to normal year-end adjustments) as to fairness of
presentation, GAAP and consistency by a Senior Officer of the Parent (such
quarterly financial statements may be furnished by furnishing to the
Lenders the Form 10-Q for such Fiscal Year filed with the Securities and
Exchange Commission, provided that the Lenders are furnished separate
comparisons for such Fiscal Quarter to the projections furnished pursuant
to SECTION 5.01(f));
(c) as soon as available and in any event within 30 days after
the end of each of the first and second Fiscal Months of each Fiscal
Quarter, consolidated financial statements (including the balance sheet and
statement of income) of the Parent and its Consolidated Subsidiaries, but
without including any results of OFS BrightWave, as of the end of such
Fiscal Month, and for the portion of the Fiscal Year ending on such date,
setting forth in comparative form the figures for the corresponding Fiscal
Month and the corresponding portion of the previous Fiscal Year, all
certified (subject to normal quarter-end adjustments and to the absence of
footnotes required by GAAP) as to fairness of presentation, GAAP and
consistency by a Senior Officer of the Parent;
(d) simultaneously with the delivery of each set of financial
statements referred to in paragraphs (a) and (b) (and (c), if and when
SECTION 5.19 is in effect on a monthly basis) above, a certificate,
substantially in the form of EXHIBIT G (a "Compliance Certificate"), of a
Senior Officer of the Parent (i) setting forth in reasonable detail the
calculations required to establish whether the Parent, the Borrower and/or
the Guarantors, as applicable, were in compliance with the requirements of
SECTIONS 5.16, 5.17 and 5.19 (if and when then in effect) and 5.20, on the
date of such financial statements and (ii) stating whether any Default
exists on the date of such certificate and, if any Default then exists,
setting forth the details thereof and the action which the Parent, the
Borrower or such Guarantor is taking or proposes to take with respect
thereto;
(e) simultaneously with the delivery of each set of annual
financial statements referred to in paragraph (a) above, (i) a statement of
the Certified Public Accountants to the effect that nothing has come to
their attention to cause them to believe that any Default existed on the
date of such financial statements under SECTION 5.19, insofar as they
relate to accounting matters (which statement may be limited to the extent
required by accounting rules or guidelines and it being acknowledged by the
Agent and the Lenders that the audit of the Certified Public Accountants
was not directed primarily toward obtaining knowledge of such compliance or
noncompliance), and (ii) a copy of any management letter furnished to the
Parent by the Certified Public Accountants;
(f) as soon as available and in no event later than March 31 of
each Fiscal Year of the Parent, projections of the Parent and its
Subsidiaries for such Fiscal Year, including income statements, balance
sheets, statements of cashflow, and borrowing base availability and (if
financial covenants are forecasted to be applicable during such Fiscal
Year) financial
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covenant calculations, and set forth Fiscal Quarter by Fiscal Quarter,
together with all material assumptions made in connection therewith;
(g) promptly, but in any event within 5 Domestic Business Days
after the Borrower or any Guarantor becomes aware of the occurrence of any
Default, a certificate of a Senior Officer thereof, setting forth the
details thereof and the action which the Borrower or such Guarantor is
taking or propose to take with respect thereto; provided that, so long as
the Borrower or such Guarantor has complied with this subsection (g) in
respect of any Default, the Agent agrees in good faith that, for so long
(but only for so long) as (i) the Borrower is negotiating or discussing
with the Agent and the Lenders whether such Default could be cured by
waiver, amendment or similar arrangement and the Agent and (ii) the
Required Banks are willing in their sole and absolute discretion to
continue such negotiations and discussions and the terms and conditions of
any such waiver, amendment or similar arrangement (it being understood that
neither the Agent nor the Lenders shall be under any obligation at any time
to enter into or participate in or continue any such negotiations or
discussions or to agree to the terms and conditions of any such waiver,
amendment or similar arrangement), the Agent will not notify the Parent,
the Borrower or such Guarantor of such Default or otherwise declare that
such Default has occurred if doing so would trigger an obligation on the
part of the Parent under applicable federal securities laws and regulations
to disclose publicly the occurrence of such Default;
(h) promptly upon the mailing thereof to the shareholders of the
Parent generally, copies of all financial statements, reports and proxy
statements so mailed;
(i) without duplication, promptly upon the filing thereof, copies
of all registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly or monthly reports which the Parent shall have filed with the
Securities and Exchange Commission;
(j) promptly after the date that any member of the Controlled
Group (i) gives or is required to give notice to the PBGC of any
"reportable event" (as defined in SECTION 4043 of ERISA) with respect to
any Plan which might constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that the plan administrator of any Plan
has given or is required to give notice of any such reportable event, a
copy of the notice of such reportable event given or required to be given
to the PBGC; (ii) receives notice of complete or partial withdrawal
liability under Title IV of ERISA, a copy of such notice; or (iii) receives
notice from the PBGC under Title IV of ERISA of an intent to terminate or
appoint a trustee to administer any Plan, a copy of such notice;
(k) as soon as practicable, but in any event on or before 20 days
after the end of each Fiscal Month, or such more frequent intervals as
required by the Agent from time to time in its commercially reasonable
judgment, a duly executed Borrowing Base Certificate (and to the Agent any
accompanying documentation reasonably required by the Agent), with respect
to satisfaction of the requirement that the Revolving Loans shall not
exceed the Borrowing Base, as of the last day of the reporting period, in
the form of EXHIBIT F or such other form as the Agent may deliver for such
purpose to the Borrower from time to time hereafter, the statements in
which, in each instance, shall be certified as to truth and accuracy by the
Senior Officer of the Borrower;
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(l) written notice of the following:
(i) promptly after any Senior Officer of the Borrower or any
Guarantor learns thereof, of (A) the commencement of any
litigation affecting the Borrower or such Guarantor or any of its
respective assets, whether or not the claim is considered by the
Borrower or such Guarantor to be covered by insurance, and (B)
the institution of any administrative proceeding which in either
case of clause (A) or (B), if decided adversely, would have a
Material Adverse Effect;
(ii) at least 30 days prior thereto, of the opening of any
new office or place of business of the Borrower or any Guarantor
or the closing of any existing office or place of business of the
Borrower or any Guarantor (in each case other than any office
that is only a sales office);
(iii) promptly after any Senior Officer of the Borrower or
any Guarantor learns thereof, of any labor dispute to which the
Borrower or such Guarantor may become a party, or any strikes or
walkouts relating to any of its plants or other facilities, which
in either case will have a Material Adverse Effect, and the
expiration of any labor contract to which it is a party or by
which it is bound;
(iv) promptly after the occurrence thereof, of any default
by any obligor under any note or other evidence of indebtedness
payable to the Borrower or any Guarantor exceeding $2,500,000;
(v) promptly after the rendition thereof, of any judgment in
an amount exceeding $2,500,000 rendered against the Borrower or
any Guarantor; and
(vi) promptly after any Senior Officer of the Borrower or
any Guarantor learns thereof, knowledge of any and all
Environmental Liabilities, pending, threatened or anticipated
Environmental Proceedings, Environmental Notices, Environmental
Judgments and Orders, and Environmental Releases at, on, in,
under or in any way affecting the Aggregate Real Properties or
any adjacent property, in each case which would have a Material
Adverse Effect or, as to the Real Properties, create an Event of
Default under SECTION 6.01(m), and
(vii) promptly after any Senior Officer of the Borrower or
any Guarantor learns thereof, of any material default by the
Borrower or any Guarantor under any note, indenture, loan
agreement, mortgage, lease, deed, guaranty or other similar
agreement relating to any Debt of the Borrower or any Guarantor
exceeding $2,500,000; and
(m) from time to time such additional information regarding the
financial position or business (including, without limitation, tax returns
and bank statements) of the Parent, the Borrower and the Subsidiaries as
the Agent, at the request of any Lender, may reasonably request.
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SECTION 5.02. Inspection of Property, Books and Records. The
Parent and the Borrower will (i) keep, and cause each Subsidiary to keep,
proper books of record and account in which full, true and correct entries
in conformity with GAAP shall be made of all dealings and transactions in
relation to its business and activities; and (ii) permit, and cause each
Subsidiary to permit, the Agent or representatives of the Agent (at the
Parent's expense if a Default or Event of Default is in existence or at the
Agent's expense prior to the occurrence of a Default or Event of Default)
to visit and inspect any of their respective properties, verify information
with any Person, to examine and make abstracts from any of their respective
books and records (including, without limitation, books, records, journals,
orders, receipts and any correspondence and other data relating to the
Collateral, to the Borrower's or such Guarantor's business or to any other
transactions between the parties hereto) and to discuss their respective
affairs, finances and accounts with their respective officers, employees
and (upon prior notice to the Borrower) the Certified Public Accountants,
the Borrower and each Guarantor agreeing to cooperate and assist in such
visits and inspections, in each case (x) prior to the occurrence of a
Default, upon prior reasonable notice at such reasonable times and as often
as may reasonably be requested, and (y) after the occurrence of a Default,
at any time and without prior notice.
SECTION 5.03. Maintenance of Existence and Management. The Parent
and the Borrower shall, and shall cause each Subsidiary to maintain, (a)
their corporate existence and carry on their business in substantially the
same manner and in substantially the same fields as such business is now
carried on and maintained, except as permitted by SECTIONS 5.04 and 5.05,
and (b) their respective corporate charters, by-laws, partnership
agreements, operating agreements and other similar documents and agreements
relating to their legal existence and organization, and not permit any
amendment or other modification thereto except for any amendment or
modification that would not affect the Obligations or result in a Material
Adverse Effect.
SECTION 5.04. Dissolution. The Borrower and the Guarantors shall
not suffer or permit dissolution or liquidation either in whole or in part,
except through corporate reorganization to the extent permitted by SECTION
5.05.
SECTION 5.05. Consolidations and Mergers. The Borrower and the
Guarantors will not, nor will they permit any other Subsidiary to, merge or
consolidate, with any Person, except for (i) subject to compliance with
SECTION 5.15, if applicable, a merger or consolidation between the
Subsidiaries or involving only the Parent or the Borrower and one or more
of the other Subsidiaries in which the Parent or the Borrower is the
surviving entity, or (ii) a merger or consolidation in which the Borrower
or any Guarantor is the surviving entity and such Person merging into the
Borrower or such Guarantor is organized and existing under the laws of a
State of the United States of America, if (A) immediately after giving
effect to such merger or consolidation, no Default or Event of Default
shall have occurred and be continuing, (B) immediately after giving effect
to such merger or consolidation on a pro forma basis (including, without
limitation, any Debt incurred or anticipated to be incurred in connection
with such merger or consolidation), the Borrower and the Guarantors would
be able to incur at least $1.00 of additional Debt under SECTION 5.20, and
(C) immediately after giving effect to such merger or consolidation on a
pro forma basis, the Parent shall have a Consolidated Tangible Net Worth
equal to or greater than its Consolidated Tangible Net Worth immediately
prior to such merger or consolidation.
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SECTION 5.06. Use of Proceeds. The proceeds of the Loans will be
used to refinance indebtedness, for capital expenditures, working capital
and for other general corporate purposes. No portion of the proceeds of the
Loans will be used by the Borrower, the Parent or any other Subsidiary (a)
in connection with, whether directly or indirectly, any tender offer for,
or other acquisition of, stock of any corporation with a view towards
obtaining control of such other corporation, unless such tender offer or
other acquisition is to be made on a negotiated basis with the approval of
the Board of Directors (or other equivalent governing body) of the Person
to be acquired, and the provisions of SECTION 5.17 would not be violated,
(b) directly or indirectly, for the purpose, whether immediate, incidental
or ultimate, of purchasing or carrying any Margin Stock, or (c) for any
purpose in violation of any applicable law or regulation.
SECTION 5.07. Compliance with Laws; Payment of Taxes. The
Borrower and the Guarantors will, and will cause each of the other
Subsidiaries and each member of the Controlled Group to, comply with
applicable laws (including but not limited to ERISA and the Fair Labor
Standards Act of 1938, as amended), regulations and similar requirements of
governmental authorities (including but not limited to PBGC), except where
the necessity of such compliance is being contested in good faith through
appropriate proceedings diligently pursued and except where failure to
comply would not have and would not reasonably be expected to cause a
Material Adverse Effect. The Borrower and the Guarantors will, and will
cause each of the other Subsidiaries to, pay promptly when due all taxes,
assessments, governmental charges, claims for labor, supplies, rent and
other obligations which, if unpaid, might become a lien against the
property of the Borrower, any of the Guarantors, or any other Subsidiary,
except liabilities being contested in good faith and against which, if
requested by the Agent, the Borrower or such Guarantor will, or will cause
such Subsidiary to, set up reserves in accordance with GAAP.
SECTION 5.08. Insurance; Net Casualty/Insurance Proceeds.
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(a) The Borrower and the Guarantors will maintain, and will cause
each of the other Subsidiaries to maintain (either in the name of the
Borrower, or in such Guarantor's or other Subsidiary's own name), with
financially sound and reputable insurance companies acceptable to the Agent
and with a Best's Rating of at least "A", insurance on all of their
property in at least such amounts and against at least such risks
(including on all its property, public liability and worker's compensation
(but solely with respect to worker's compensation, only to the extent not
self-insured), and business interruption insurance) as are usually insured
against in the same general area by companies of established repute engaged
in the same or similar business. The Borrower shall deliver the originals
or copies (which copies shall be certified if requested by the Agent) of
such policies to the Agent, and as to such policies insuring the Borrower
or any of the Guarantors, with satisfactory lender's loss payable
endorsements naming the Agent, as agent for the Lenders, as sole loss
payee, assignee and additional insured, as its interests may appear. Each
policy of insurance or endorsement pertaining to the Borrower or any of the
Guarantors shall contain a clause (i) not permitting cancellation by the
Borrower or
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such Guarantor without the prior written consent of the Agent, (ii)
requiring the insurer to give not less than 30 days prior written notice to
the Agent in the event of cancellation or non-renewal by the insurance
company of the policy for any reason whatsoever, and (iii) specifying that
the interest of the Agent shall not be impaired or invalidated by any act
or neglect of the Borrower or such Guarantor or the owner of the property
or by the occupation of the premises for purposes more hazardous than are
permitted by said policy. Upon the date of this Agreement, and from time to
time thereafter upon the Agent's request, the Borrower and the Guarantors
shall provide the Agent with a statement from each insurance company
providing the foregoing coverage, acknowledging in favor of the Agent the
continued effectiveness of the foregoing insurance clauses. If the Borrower
and/or the Guarantors fail to provide and pay for such insurance, the Agent
may, at its option, but shall not be required to, procure the same and
charge the Borrower therefor as a part of the Obligations.
(b) Net Casualty/Insurance Proceeds must be applied to either (i)
the payment of the Obligations, or (ii) the repair and/or restoration of
the Collateral (unless repair or restoration would, in the commercially
reasonable judgment of the Borrower, be impracticable or uneconomical,
which event the Borrower or such Guarantor may retain such proceeds if they
are less than $1,000,000). If either an Event of Default has occurred, or
the cost to repair or restore the Collateral exceeds $1,000,000, then, in
such event, the Agent, at the direction of the Required Lenders, shall
determine, in their sole discretion, the manner in which Net
Casualty/Insurance Proceeds are to be applied. If no Event of Default has
occurred and the cost to repair or restore the Collateral is $1,000,000 or
less, the Borrower shall determine the manner in which Net
Casualty/Insurance Proceeds are to be applied.
SECTION 5.09. Change in Fiscal Year. The Parent will not change
its Fiscal Year, or the fiscal year of the Borrower or any other
Subsidiary, without the consent of the Required Lenders.
SECTION 5.10. Maintenance of Property. The Borrower and the
Guarantors shall, and shall cause each other Subsidiary to, maintain all of
its material properties and assets in reasonably good condition, repair and
working order, ordinary wear and tear excepted. The Borrower and the
Guarantors shall maintain all material Equipment in good operating
condition and repair, reasonable wear and tear excepted and all necessary
replacements of and repairs thereto shall be made so that the value and
operating efficiency of the Equipment shall be maintained and preserved,
reasonable wear and tear excepted. Without the prior written consent of the
Agent, none of the Equipment may be affixed to any real property such that
it is characterized as a Fixture under applicable law, unless the Agent has
a Mortgage on the interests of the Borrower or Guarantor on such real
property.
SECTION 5.11. Material Contracts. The Borrower and the Guarantors
shall comply, and cause each other Subsidiary to comply, with all material
terms and conditions of any Material Contract to which it is a party.
Without the Agent's and the Required Lenders' prior written consent, the
Borrower and the Guarantors will not (a) enter into, or permit any other
Subsidiary to enter into, any amendment or modification to any Material
Contract of a material nature, or (b) permit any Material Contract to be
cancelled or terminated prior to its stated maturity, if in either case
such amendment, modification, cancellation or termination would be
reasonably likely to have a Material Adverse Effect. The Borrower and the
Guarantors agree that they shall promptly notify the Agent and deliver to
the Agent any notice received by the Borrower or such Guarantor with
respect to any event which constitutes a default by the Borrower or such
Guarantor or any other Subsidiary under any Material Contract to which the
Borrower, such Guarantor or such other Subsidiary is a party.
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SECTION 5.12. Environmental Matters. Neither the Parent, the
Borrower nor any Subsidiary will, and the Borrower and the Guarantors will
use their commercially reasonable efforts not to, permit any Third Party
to, use, produce, manufacture, process, treat, recycle, generate, store,
dispose of, manage at, or otherwise handle, or ship or transport to or from
the Aggregate Real Properties any Hazardous Materials except for Hazardous
Materials such as cleaning solvents, pesticides and other similar materials
used, produced, manufactured, processed, treated, recycled, generated,
stored, disposed, managed, or otherwise in the ordinary course of business
in substantial compliance with all applicable Environmental Requirements,
except where the failure to comply could not reasonably be expected to have
or cause a Material Adverse Effect or, as to the Real Properties, create an
Event of Default under SECTION 6.01(m).
SECTION 5.13. Environmental Release. The Borrower and each
Guarantor agrees that upon the occurrence of an Environmental Release at or
on any of the Aggregate Real Properties it will act immediately to
investigate the extent of, and to take appropriate remedial action to
respond to, such Environmental Release, whether or not ordered or otherwise
directed to do so by any Environmental Authority.
SECTION 5.14. Transactions with Affiliates. Other than (i)
transactions or arrangements existing on the Closing Date and described on
SCHEDULE 5.14 and (ii) transactions otherwise permitted under this
Agreement, neither the Borrower nor the Guarantors shall, and shall not
permit any of the other Subsidiaries to, enter into, or be a party to, any
transaction involving $1,000,000 or more with any Affiliate of the Parent,
the Borrower or such Guarantor or any other Subsidiaries (which Affiliate
is not the Borrower or a Guarantor or a Wholly Owned Subsidiary), except as
permitted by law and in the ordinary course of business and pursuant to
reasonable terms which are fully disclosed to the Agent and the Lenders and
are no less favorable to the Parent, the Borrower, such Guarantor or such
other Subsidiary than would be obtained in a comparable arm's length
transaction with a Person which is not an Affiliate. All obligations
(consisting of Debt or otherwise) owed by any Affiliate (other than OFS
Brightwave, the Borrower or any Guarantor) to the Parent, the Borrower, any
Guarantor or any other Subsidiary shall by its terms be subordinated in
full to the payment of the Obligations during the existence of any Event of
Default.
SECTION 5.15. Special Provisions Concerning Subsidiaries. Neither
the Borrower nor any of the Guarantors shall hereafter (i) create or
acquire any Subsidiary, except as permitted by SECTION 5.16(vii) or
5.16(viii), or (ii) divest itself of any material assets by transferring
them to any Subsidiary that is not a Guarantor, except as otherwise
permitted under this Agreement. In the event that, as permitted by SECTION
5.16(vii) or 5.16(viii) or with the Required Lenders' prior written
consent, the Borrower or any Guarantor acquires or creates any Subsidiary
which is not a Guarantor, or any Subsidiary which was not a Material
Subsidiary on the Closing Date becomes a Material Subsidiary, then,
promptly upon the acquisition or creation thereof, the Borrower or such
Guarantor shall:
(a) if such new Subsidiary is a Material Domestic Subsidiary,
cause such Material Domestic Subsidiary to execute and deliver to the Agent
a joinder agreement in the form of EXHIBIT T, pursuant to which (1) it
shall become a Subsidiary Guarantor and a party to the Guaranty, (2) it
shall become a "Contributing Party" and a party to the Contribution
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Agreement, and (3) it shall become a party to each Security Document that
is relevant to the type of assets held by it, granting to the Agent a first
priority perfected Lien in all of the assets of such Subsidiary subject
only to Permitted Encumbrances, and deliver to the Agent evidence of
corporate authority therefor and opinions of counsel with respect thereto,
all satisfactory to the Agent in all respects;
(b) if such new Subsidiary is a Domestic Subsidiary, execute and
deliver to the Agent an amendment to the Pledge Agreement, if it is already
a party thereto, otherwise a joinder agreement in the form of EXHIBIT T
becoming a party to the Pledge Agreement, in either case pursuant to which
it grants to the Agent, a first priority perfected Lien on all of the
equity interests held by it in such Domestic Subsidiary, and in the latter
case, such evidence of corporate authority therefor and opinions of counsel
with respect thereto, all satisfactory to the Agent in all respects; and
(c) if such new Subsidiary is a Material Foreign Direct
Subsidiary, execute and deliver to the Agent an amendment to the Pledge
Agreement, if it is already a party thereto, otherwise a joinder agreement
in the form of EXHIBIT T becoming a party to the Pledge Agreement, in
either case pursuant to which it grants to the Agent, a first priority
perfected Lien on 65% of the equity interests held by it in such Material
Foreign Direct Subsidiary, and in the latter case, such evidence of
corporate authority therefor and opinions of counsel with respect thereto,
all reasonably satisfactory to the Agent in all respects.
SECTION 5.16. Restricted Payments and Investments and
Acquisitions. The Parent will not declare or make any Restricted Payment
during any Fiscal Year, and the Borrower and the Guarantors shall not, and
shall not permit any of the other Subsidiaries to, make Investments in any
Person or their assets except:
(i) (x) loans or advances to employees (it being understood
that cashless option exercises shall not be deemed loans or
advances to employees) not exceeding $250,000 in the aggregate
principal amount outstanding at any time, in each case made in
the ordinary course of business and consistent with practices
existing on the Closing Date, (y) relocation loans and advances
made to employees in the ordinary course of business and
consistent with practices existing on the Closing Date, and (z)
repurchases of Capital Stock of the Parent from terminated or
departing employees in an aggregate amount not exceeding $500,000
for any Fiscal Year;
(ii) deposits required by government agencies, public
utilities or insurance companies;
(iii) Investments existing on the Closing Date, including
amounts outstanding on the Closing Date pursuant to the
BrightWave Revolving Credit Commitment and amounts loaned
thereafter pursuant thereto, provided, however, that the amount
of the BrightWave Revolving Credit Commitment may not be
increased, loans and advances in excess of the BrightWave
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Revolving Credit Commitment shall not be permitted and the date
of termination of the BrightWave Revolving Credit Commitment may
not be extended, without the prior written consent of the Agent,
acting at the direction of the Required Lenders;
(iv) Investments in (A) direct obligations of the United
States Government or any agency thereof maturing within one year
after the date of acquisition thereof, (B) direct obligations of
any state of the United States of America or any political
subdivision of any such state or public instrumentality thereof
maturing within one year after the date of acquisition thereof
and having, at the time of acquisition, one of the two highest
ratings obtainable from S&P or ▇▇▇▇▇'▇, (C) domestic and
Eurodollar certificates of deposit or time deposits maturing
within 90 days after the date of acquisition thereof issued by
any commercial bank organized under the laws of the United States
of America or any state thereof or the District of Columbia or
European Economic Community or Canada having combined capital and
surplus of not less than $500,000,000, (D) bankers' acceptances
maturing no more than 90 days after the date of creation thereof
and, at the time of acquisition, having a rating of at least A-1
or P-1 from either S&P or ▇▇▇▇▇'▇, (E) commercial paper rated
"A1" or the equivalent thereof by S&P or "P1" or the equivalent
thereof by ▇▇▇▇▇'▇ and in either case maturing within 6 months
after the date of acquisition, (F) auction rate bonds, auction
rate preferred stock and other similar corporate securities of a
type and with terms consistent with the Borrower's short-term
investment policies and that, at the time of acquisition, either
(i) bear one of the two highest ratings obtainable from either
S&P or ▇▇▇▇▇'▇ or (ii) are fully supported by a letter of credit
issued by a bank satisfying the criteria set forth in clause (G)
below, (G) tender bonds the payment of the principal of and
interest on which is fully supported by a letter of credit issued
by a United States bank whose long-term certificates of deposit
are rated at least "AA" or the equivalent thereof by S&P and "Aa"
or the equivalent thereof by ▇▇▇▇▇'▇, (H) repurchase agreements
with respect to United States government securities, with
contract periods not to exceed 30 days, and (I) money market
mutual funds that invest primarily in the instruments set forth
in the foregoing clauses of this definition;
(v) Investments as a result of Interest Rate Protection
Agreements not entered into for speculative purposes;
(vi) Investments as a result of ForEx Contracts not entered
into for speculative purposes;
(vii) (w) Investments in newly created Domestic
Subsidiaries, provided that the applicable requirements of
SECTION 5.15 are satisfied; (x) Investments by the Borrower or
any Guarantor in Brazilian and Chinese subsidiaries in an
aggregate amount not exceeding $30,000,000 for all such
Investments made from and after the Closing Date; (y) Investments
by the Borrower or any Guarantor in other Foreign Subsidiaries,
provided that the applicable requirements of SECTION 5.15 are
satisfied and provided further that the aggregate amount of all
such Investments under this clause (y) made from and after the
Closing Date shall not exceed $10,000,000 and (z) transfers of
Equipment by the Borrower or a
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Domestic Subsidiary to a Foreign Subsidiary pursuant and subject
to the provisions of SECTION 5.30(b); provided, however, that
immediately after giving effect to the making of any Investment
permitted by this clause (vii), (1) the aggregate amount of
Investments permitted by clauses (x) and (y), together with the
aggregate amount of Debt of Foreign Subsidiaries permitted under
SECTION 5.20(j)(2), shall not at any time exceed $40,000,000, and
(2) no Default or Event of Default shall have occurred and be
continuing;
(viii) Investments made in exchange for Capital Stock;
provided, however, that immediately after giving effect to the
making of any Investment permitted by this clause (viii), no
Default or Event of Default shall have occurred and be
continuing;
(ix) Restricted Payments by the Parent and other Investments
by the Borrower and the Guarantors made with cash which are made
after the Closing Date (other than pursuant to the BrightWave
Revolving Credit Commitment) if, after giving effect thereto,
there are no Revolving Loans outstanding hereunder and that for
the most recently completed 12 consecutive Fiscal Months (x) the
Funded Debt/EBITDA Ratio is less than 3.0 to 1.0, and (y) the
Fixed Charge Coverage Ratio (but without including the amount of
such Restricted Payment or other Investment in the calculation of
Consolidated Fixed Charges for purposes of this determination) is
more than 1.75 to 1.0; provided, however, that immediately after
giving effect to the making of any Restricted Payment or
Investment permitted by this clause (ix), no Default or Event of
Default shall have occurred and be continuing;
(x) Investments (including debt obligations) of the Borrower
and its Subsidiaries received in connection with the bankruptcy
or reorganization of suppliers and customers and in good faith
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of
business (to the extent such settlements are otherwise permitted
hereunder; and
(xi) Investments in the Borrower and in Guarantors and
Investments by Subsidiaries that are not Guarantors (other than
the Borrower) in other Subsidiaries that are not Guarantors.
SECTION 5.17. Permitted Liens. The Borrower and the Guarantors
will not, and will not permit any other Subsidiary to, create, assume or
suffer to exist any Lien, directly or indirectly, on any asset now owned or
hereafter acquired by it, except, with respect to the Collateral, the
Permitted Encumbrances, and with respect to assets other than Collateral,
other Liens set forth below:
(a) Liens existing on the date of this Agreement securing Debt
and other obligations outstanding on the Closing Date of this Agreement and
disclosed in the Collateral Disclosure Certificates;
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(b) any Lien existing on any specific fixed asset of any
corporation or other entity at the time such corporation or other entity
becomes a Subsidiary and not created in contemplation of such event;
(c) any Lien on any specific fixed asset securing Debt incurred
or assumed for the purpose of financing all or any part of the cost of
acquiring or constructing such asset, provided that such Lien attaches to
such asset concurrently with or within 18 months after the acquisition or
completion of construction thereof;
(d) any Lien on any specific fixed asset of any corporation or
other entity existing at the time such corporation or other entity is
merged or consolidated with or into the Borrower, a Guarantor or another
Subsidiary and not created in contemplation of such event;
(e) any Lien existing on any specific fixed asset prior to the
acquisition thereof by the Borrower, a Guarantor or another Subsidiary and
not created in contemplation of such acquisition;
(f) Purchase Money Liens on fixed assets permitted under SECTION
5.20(h);
(g) Liens on the Headquarters Facility securing Approved
Headquarters Facility Mortgage Debt;
(h) Liens on assets of Foreign Subsidiaries securing Debt of
Foreign Subsidiaries permitted under SECTION 5.20(j);
(i) Liens imposed by law (including, without limitation) for
taxes or other governmental charges not past due for more than 30 days or
being contested in good faith by appropriate proceedings, and for which
adequate reserves have been established in accordance with GAAP), and Liens
incidental to the conduct of its business or the ownership of its assets
which (i) do not secure Debt and (ii) do not in the aggregate materially
detract from the value of its assets or materially impair the use thereof
in the operation of its business;
(j) any Lien on Margin Stock;
(k) any attachment or judgment Lien not constituting an Event of
Default under SECTION 6.01 that is being contested in good faith by
appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP; and
(l) other Liens securing obligations not exceeding $1,000,000 in
aggregate principal amount outstanding at any time; provided, however, that
immediately after giving effect to the creation, assumption, existence or
incurrence of any Liens permitted by this SECTION 5.17(l), no Default or
Event of Default shall have occurred and be continuing.
SECTION 5.18. Restrictions on Ability of Borrower and
Subsidiaries to Pay Dividends. The Borrower and the Guarantors shall not,
and shall not permit any Subsidiary to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any contractual
encumbrance or restriction on the ability of any Subsidiary to (a) pay any
dividends or make any other distributions on its Capital Stock or
Redeemable Preferred Stock or any other
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interest or (b) make or repay any loans or advances to the Borrower or the
Guarantors, in each case other than such restrictions or encumbrances
existing under or by reason of (i) this Agreement and the other Credit
Documents, (ii) applicable requirements of law, and (iii) agreements in
effect as of the date hereof.
SECTION 5.19. Financial Covenants. The financial covenants set
forth in this SECTION 5.19 shall be determined on a consolidated basis and
tested quarterly (or monthly, upon written notice at any time from the
Agent in its commercially reasonable judgment), commencing the first full
Fiscal Quarter following the Closing Date, and shall be in effect and
applicable at all times, except during any period in which (i) Excess
Borrowing Availability is greater than $50,000,000, or (ii) Excess
Borrowing Availability is equal to or greater than $30,000,000 and there
are no outstanding Revolving Loans.
(a) Fixed Charge Coverage Ratio The Fixed Charge Coverage Ratio,
calculated for the Fiscal Quarter (or Fiscal Month) just ended and the
immediately preceding three Fiscal Quarters (or 11 Fiscal Months), will be
equal to or greater than 1.4 to 1.0.
(b) Funded Debt/EBITDA Ratio. The Funded Debt/EBITDA Ratio will
not exceed 3.50 to 1.0, calculated at the end of each Fiscal Quarter (or
Fiscal Month), calculated as to Consolidated Net Funded Debt as of the
Fiscal Quarter (or Fiscal Month) just ended and calculated as to
Consolidated EBITDA for the Fiscal Quarter (or Fiscal Month) just ended and
the immediately preceding three Fiscal Quarters (or 11 Fiscal Months).
(c) Minimum Ongoing Excess Borrowing Availability. Excess
Borrowing Availability shall not at any time be less than $5,000,000.
(d) Capital Expenditures. Neither the Borrower nor the Guarantors
shall, nor shall they permit any other Subsidiary to, make any expenditures
(including obligations incurred under any lease) in any Fiscal Year that
are required to be capitalized under GAAP in the aggregate for the
Borrower, the Guarantors and the other Subsidiaries, on a consolidated
basis, exceeding $40,000,000.
SECTION 5.20. Permitted Debt. The Borrower and the Guarantors
will not, or will not permit any other Subsidiary to, create, assume, incur
or suffer to exist any Debt, except as follows (the amounts set forth below
are in the aggregate for the Borrower, the Guarantors and all other
Subsidiaries).
(a) (w) Debt owing by the Borrower to any Guarantor, or by any
Guarantor to the Borrower or any other Guarantor, (x) Debt owing by any
Subsidiary (other than the Borrower or a Guarantor) to the Borrower or any
Guarantor, in an aggregate amount (for all such Subsidiaries) not to exceed
$5,000,000 at any time outstanding, (y) Debt owing by any Subsidiary (other
than the Borrower or a Guarantor) to any other Subsidiary (other than the
Borrower or a Guarantor), and (z) Debt consisting of Guarantees by Parent,
the Borrower or any of its Subsidiaries incurred in the ordinary course of
business for the benefit of Parent, the Borrower or any Subsidiary,
provided that the primary obligation being guaranteed is permitted by this
Agreement, and provided, further, that immediately after giving effect to
the creation,
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assumption or incurrence of any Debt permitted by clause (x) of this
paragraph (a), no Default or Event of Default shall have occurred and be
continuing;
(b) Debt to the Agent and the Lenders under this Agreement and
the other Credit Documents and to Wachovia or the LC Issuer under any
document or agreement pertaining to any Letter of Credit or the ForEx
Obligations;
(c) Debt to Persons other than that described in the foregoing
clauses (a) and (b) existing on the date of this Agreement and described in
SCHEDULE 5.20;
(d) Subordinated Debt;
(e) Debt consisting of accrued pension fund and other employee
benefit plan obligations and liabilities;
(f) Debt consisting of deferred taxes;
(g) Debt resulting from endorsements of negotiable instruments
received in the ordinary course of business;
(h) Debt secured by Purchase Money Liens permitted hereby, not to
exceed $2,000,000 in the aggregate incurred during any Fiscal Year of the
Parent;
(i) Approved Headquarters Facility Mortgage Debt; provided,
however, that immediately after giving effect to the creation, assumption
or incurrence of any Debt permitted by this paragraph (i), no Default or
Event of Default shall have occurred and be continuing; facility;
(j) Debt of Foreign Subsidiaries of the Borrower (other than Debt
owing to the Parent or any Subsidiary of the Parent), and (without
duplication) Guarantees by the Parent thereof (1) in an aggregate amount
not to exceed $15,000,000 at any time outstanding, and (2) other such Debt
in an aggregate amount which, together with Investments in Foreign
Subsidiaries permitted under SECTION 5.16(vi)(x) and (y), does not exceed
$40,000,000; provided, however, that immediately after giving effect to the
creation, assumption or incurrence of any Debt permitted by this paragraph
(j), no Default or Event of Default shall have occurred and be continuing;
facility;
(k) contingent obligations with respect to letters of credit
which have been issued but not drawn upon;
(l) other Debt for any Fiscal Year of the Parent, the Borrower or
any Guarantor in an aggregate amount for all such entities (without
duplication) not to exceed $5,000,000; provided, however, that immediately
after giving effect to the creation, assumption or incurrence of any Debt
permitted by this paragraph (l), no Default or Event of Default shall have
occurred and be continuing;
(m) Debt as a result of Interest Rate Protection Agreements and
ForEx Contracts as the same are permitted under SECTION 5.17; and
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(n) Debt arising out of the refinancing, extension, renewal or
refunding of any Debt permitted by any of the foregoing paragraphs of this
SECTION so long as, in the case of Debt permitted under clause (c), the
principal amount thereof is not increased from the amount outstanding on
the date of refinancing, and in the case of Debt permitted under clauses
(h), (j) and (l), the principal amount thereof is not increased in
violation of such clauses.
SECTION 5.21. Limitation on Issuance and Sale of Capital Stock
and Redeemable Preferred Stock of Subsidiaries. The Borrower and the
Subsidiary Guarantors shall not, nor shall the Borrower or the Guarantors
permit any Wholly Owned Subsidiary to, issue any Capital Stock, other than
to the Parent or one of its Wholly Owned Subsidiaries or permit any Person
other than the Parent or one of its Subsidiaries to own any Capital Stock
or Redeemable Preferred Stock of a Wholly Owned Subsidiary (other than
directors' qualifying shares); or sell any of the Capital Stock or
Redeemable Preferred Stock of a Subsidiary, or permit any Subsidiary to
sell any of the Capital Stock or Redeemable Preferred Stock of any other
Subsidiary, unless (a) the Parent or such Subsidiary, as the case may be,
receives consideration at the time of such sale at least equal to the fair
market value of the Capital Stock and Redeemable Preferred Stock disposed
of and at least 75% of the consideration received by the Parent or such
Subsidiary for such Capital Stock or Redeemable Preferred Stock is in the
form of cash or cash equivalents, (b) no Default or Event of Default exists
prior to and as a result of such sale, and (c) after giving effect to any
such sale of Capital Stock or Redeemable Preferred Stock on a pro forma
basis (and the resulting elimination of such Subsidiary's accounts and
inventory from the Borrowing Base, if applicable), the Borrower is able to
borrow $1.00 or more under SECTION 2.01(a).
SECTION 5.22. Change of Principal Place of Business or Location
of Collateral. None of the Borrower nor any of the Guarantors shall
transfer its principal place of business or Executive Office, or open new
Collateral Locations or warehouses, or transfer existing Collateral
Locations or warehouses, or locate the Collateral at any location other
than a Collateral Location, or maintain records with respect to Collateral,
to or at any locations other than those at which the same are presently
kept or maintained as set forth on the Collateral Disclosure Certificates
without at least 30 days prior written notice to the Agent.
SECTION 5.23. Physical Inventories. The Borrower and the
Guarantors shall conduct a physical inventory no less frequently than
annually and shall provide to the Agent a report of such physical inventory
promptly thereafter, together with such supporting information as the Agent
shall reasonably request.
SECTION 5.24. Inventory Returns. If at any time or times
hereafter any Account Debtor returns any Inventory of the Borrower or any
Guarantor the shipment of which generated an account on which such Account
Debtor is obligated in excess of $1,000,000, the Borrower or such Guarantor
shall promptly notify the Agent of the same immediately, specifying the
reason for such return and the location and condition of the returned
Inventory.
SECTION 5.25. Intellectual Property. Except in each instance
where the failure to comply with any of the following covenants would not
be reasonably likely to have a Material Adverse Effect:
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(a) The Borrower and each Guarantor (either itself or through
licensees) will (i) use each Trademark on each and every trademark class of
goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain as in the
past the quality of products and services offered under such Trademark,
(iii) use such Trademark with the appropriate notice of registration and
all other notices and legends required by applicable requirements of law,
(iv) not adopt or use any ▇▇▇▇ which is confusingly similar or a colorable
imitation of such Trademark unless the Agent shall obtain a perfected
security interest in such ▇▇▇▇ pursuant to this Agreement, and (v) not (and
not permit any licensee or sublicensee thereof to) do any act or omit to do
any act whereby such Trademark may become invalidated or impaired in any
way.
(b) The Borrower and each Guarantor (either itself or through
licensees) will not do any act, or omit to do any act, whereby any Patent
may become forfeited, abandoned or dedicated to the public.
(c) The Borrower and each Guarantor (either itself or through
licensees) (i) will employ each Copyright and (ii) will not (and will not
permit any licensee or sublicensee thereof to) do any act or omit to do any
act whereby any portion of the Copyrights may become invalidated or
otherwise impaired. The Borrower and each Guarantor will not (either itself
or through licensees) do any act whereby any portion of the Copyrights may
fall into the public domain.
(d) The Borrower and each Guarantor (either itself or through
licensees) will not use any Intellectual Property to infringe the
intellectual property rights of any other Person.
(e) The Borrower and each Guarantor will notify the Agent
immediately if it knows, or has reason to know, that any application or
registration relating to any Intellectual Property may become forfeited,
abandoned or dedicated to the public, or of any adverse determination or
development (including, without limitation, the institution of, or any such
determination or development in, any proceeding in the United States Patent
and Trademark Office, the United States Copyright Office or any other
governmental authority in any country) regarding the Borrower's or such
Guarantor's ownership of, or the validity of, any Intellectual Property or
the Borrower's or such Guarantor's right to register the same or to own and
maintain the same.
(f) Whenever the Borrower or any Guarantor, either by itself or
through any agent, employee, licensee or designee, shall file an
application for the registration of any Intellectual Property with the
United States Patent and Trademark Office, the United States Copyright
Office or any similar office or agency in any other country or any
political subdivision thereof, the Borrower or such Guarantor shall report
such filing to the Agent within five Business Days after the last day of
the fiscal quarter in which such filing occurs. Upon request of the Agent,
the Borrower or such Guarantor shall execute and deliver, and have
recorded, any and all agreements, instruments, documents, and papers as the
Agent may request to evidence the Agent's security interest in any
Copyright, Patent or Trademark and the goodwill and general intangibles of
the Borrower or such Guarantor relating thereto or represented thereby.
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(g) The Borrower and the Guarantors will take all reasonable and
necessary steps, including, without limitation, in any proceeding before
the United States Patent and Trademark Office, the United States Copyright
Office or any similar office or agency in any other country or any
political subdivision thereof, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of
the material Intellectual Property, including, without limitation, filing
of applications for renewal, affidavits of use and affidavits of
incontestability.
(h) In the event that any Intellectual Property is infringed,
misappropriated or diluted by a third party, the affected Borrower or
Guarantor shall (i) take such actions as the Borrower or such Guarantor
shall reasonably deem appropriate under the circumstances to protect such
Intellectual Property and (ii) promptly notify the Agent after it learns
thereof and ▇▇▇ for infringement, misappropriation or dilution, to seek
injunctive relief where appropriate and to recover any and all damages for
such infringement, misappropriation or dilution.
SECTION 5.26. Records Respecting Collateral. All records of the
Borrower and the Guarantors with respect to the Collateral will be kept at
their respective Executive Offices and will not be removed from such
address without the prior written consent of Agent.
SECTION 5.27. Reports Respecting Collateral. The Borrower and the
Guarantors shall, as soon as practicable, but in any event on or before 20
days after the end of each Fiscal Month, furnish or cause to be furnished
to the Agent a status report, certified by a duly authorized officer of the
Borrower and each of the Guarantors, showing: (a) the aggregate dollar
value of the Collateral comprising the Accounts and the age of each
individual item thereof comprised of trade accounts receivable as of the
last day of the preceding Fiscal Month (segregating such items in such
manner and to such degree as the Agent may request, including, without
limitation, by Account Debtor name, address, invoice number, due date and
invoice date); (b) the aggregate dollar value of the Accounts subject to
"▇▇▇▇ and hold" arrangements (segregating such items in such manner and to
such degree as the Agent may request); (c) the aggregate dollar value of
the items comprising the accounts payable of the Borrower and each of the
Guarantors and the age of each individual item thereof as of the last day
of the preceding Fiscal Month (segregating such items in such manner and to
such degree as the Agent may request); (d) the type, dollar value and
location of the Inventory as at the end of the preceding Fiscal Month,
valued at the lower of its FIFO cost or market value; and (e) the aggregate
dollar value of all returns, repossessions or discounts with respect to
Inventory in excess of $1,000,000. Additionally, the Agent may, at any time
in its sole discretion (and upon prior notice to the Borrower if no Event
of Default has occurred and is continuing), require the Borrower or any of
the Guarantors to permit the Agent in its own name or any designee of the
Agent in its own name to verify the individual account balances of or any
other matter relating to the individual Account Debtors promptly upon its
request therefor by mail, telephone, telegraph or otherwise. The Borrower
and each of the Guarantors shall cooperate fully with the Agent in an
effort to facilitate and promptly conclude any such verification process.
In any event, with the above described status report for the month of
December of each year and upon request from the Agent, made at any time
hereafter, the Borrower and each of the Guarantors shall furnish the Agent
with a then current customer and Account Debtor name and address list,
together with (if requested by the Agent) updates of Equipment lists and an
appraisal or updates of the appraisal of the Equipment. Upon the Agent's
request therefor, the Borrower and each of the Guarantors shall deliver to the
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Agent copies of proof of delivery and the original copy of all
documents, including, without limitation, repayment histories and present
status reports relating to all accounts listed on any Borrowing Base
Certificate and such other matters and information relating to the status
of the Accounts of the Borrower and each of the Guarantors as the Agent
shall reasonably request.
SECTION 5.28. Collateral Location Waivers. With respect to each
of the Collateral Locations at which the Borrower or any Guarantor
maintains Collateral having a value in excess of $500,000, the Borrower and
the Guarantors will obtain such waivers of lien, estoppel certificates or
subordination agreements as the Agent may reasonably require to insure the
priority of its security interest in that portion of the Collateral
situated at such locations. Borrower shall provide written notice to the
Agent promptly upon the early termination by the Landlord of any lease for
which the Agent has obtained a Waiver and Agreement.
SECTION 5.29. Appraisals; Field Examinations. The Agent reserves
the right, exercisable from time to time hereafter in the Agent's
commercially reasonable judgment, to require that the Borrower and/or any
of the Guarantors obtain, and the Borrower and/or such Guarantors shall so
obtain, at the Borrower's expense, appraisals or updates to any existing
appraisals being obtained in connection with the execution and delivery of
this Agreement, reflecting then current values of the Equipment; provided,
that unless an Event of Default has occurred and is continuing, not more
than one such appraisal annually shall be conducted at the Borrower's
expense. The Agent shall have the right to conduct up to 2 field exams per
year as to each of the Accounts and the Inventory, at the Borrower's
expense, but reserves the right to conduct a review with less frequency, or
at any time at the Borrower's expense following the occurrence and during
the continuance of any Event of Default.
SECTION 5.30. Dispositions of Collateral.
--------------------------
(a) Except for sales of inventory in the ordinary course of
business, sales, leases or transfers among the Borrower and the Guarantors,
the sale of the Borrower's Kings Mountain, North Carolina facility and
dispositions of Equipment pursuant to SECTION 5.30(b), neither the Borrower
nor any of the Guarantors will sell, lease, exchange, arrange for a sale
and leaseback, or otherwise dispose of any of the Collateral without the
prior written consent of the Agent, acting at the direction of (i) as to
Collateral of the types described in the definition and used in the
calculation of the Borrowing Base, all of the Lenders, and (ii) as to all
other Collateral, the Required Lenders.
(b) Neither the Borrower nor any of the Guarantors will sell,
lease, exchange, arrange for a sale and leaseback, or otherwise dispose of
any of the Equipment without the prior written consent of the Agent;
provided, however, that, with notice to, but without the necessity of
consent of, the Agent, from time to time hereafter, in the ordinary course
of the Borrower's or any Guarantor's, the Borrower or such Guarantor (or
any other Domestic Subsidiary, as to clauses (i) and (ii)) may (i) transfer
Equipment not located in the United States of America to a Foreign
Subsidiary, (ii) sell (including transfers of Equipment located in the
United States of America to a Foreign Subsidiary) such portions of its
Equipment which in the aggregate during any Fiscal Year, has a market value
or a book value, whichever is more, of $5,000,000 or less, provided, that
the Amortizing Equipment Availability Amount shall be reduced by the amount
of the proceeds from such sales of such sold Equipment that was included in
such calculation and
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any other sales consented to by the Agent pursuant hereto (if such
Equipment was, immediately prior to the sale thereof, included in the
Amortizing Equipment Availability Amount), and provided further that no
Default or Event of Default exists, and (iii), sell, exchange or otherwise
dispose of portions of its Equipment which are obsolete, worn-out or
unsuitable for continued use by the Borrower or such Guarantor if (unless
the Borrower or such Guarantor determines in its commercially reasonable
good faith judgment that replacement is not necessary in the continued
operation of its business) such Equipment is replaced promptly upon its
disposition and (if so replaced other than through (x) the incurrence of
Debt secured by a Purchase Money Lien permitted under SECTION 5.20 or (y)
an operating lease) in which the Agent shall obtain and have a first
priority security interest pursuant hereto subject only to Permitted
Encumbrances.
SECTION 5.31. Changes to Federal Taxpayer Identification Number;
Organizational Identification Number. Neither the Borrower nor any
Guarantor may change its federal taxpayer identification number without 30
days' prior written notice to the Agent. If the Borrower or any Guarantor
does not have an organizational identification number as of the Closing
Date, but receives one at a later date, it will promptly notify Agent of
its organizational identification number. The Borrower and each Guarantor
will promptly notify the Agent of any change in its organizational
identification number.
SECTION 5.32. Discounts and Allowances. Upon the granting of any
discounts, allowances or credits by the Borrower or any Guarantor in excess
of $500,000 or not in the ordinary course of business and which in either
case are not shown on the face of the invoice for the Account involved, the
Borrower or such Guarantor shall promptly report such discounts, allowances
or credits, as the case may be, to the Agent and in no event later than the
time of its submission to the Agent of the next status report as required
by SECTION 5.27. In the event any amount due and owing in excess of
$500,000 is in dispute between the Borrower or any Guarantor and any
Account Debtor, the Borrower or such Guarantor shall provide the Agent with
a report thereon, explaining in detail the reason for the dispute, all
claims related thereto and the amount in controversy. During the existence
of an Event of Default, and without affecting the Borrower's or any
Guarantor's liability with respect to the Obligations, the Agent, in the
exercise of its sole discretion, may settle disputes and otherwise deal
with the Account Debtors and the Borrower shall reimburse the Agent as a
part of the Obligations any out-of-pocket expenses incurred by the Agent in
connection therewith.
SECTION 5.33. Taxes Owing with Respect to Accounts. The Borrower
and each Guarantor agrees that it shall notify the Agent if any Account of
the Borrower or such Guarantor includes any such tax due to any
governmental taxing authority. If an Account of the Borrower or any
Guarantor includes a charge for any tax payable to any governmental taxing
authority, the Agent is authorized, in its sole discretion, to pay the
amount thereof to the proper taxing authority for the Account of the
Borrower or such Guarantor.
SECTION 5.34. Commercial Tort Claims. The Borrower and each
Guarantor agrees that it shall, within 30 days after the Borrower or such
Guarantor makes a filing or appearance in court with respect to a
Commercial Tort Claim for damages equal to or exceeding $1,000,000 (which
amount, if not expressly set forth in a filing, shall be the amount the
Borrower or such Guarantor in good faith believes to be such amount of
damages), send the Agent and the
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Lenders written notice, signed by the Borrower or such Guarantor,
containing the following: (a) a summary description of the parties
involved, the amount claimed for damages by the Borrower or such Guarantor,
and the events that gave rise to such Commercial Tort Claim, and (b) a
grant of a security interest in such Commercial Tort claim in favor of the
Agent for the benefit of the Lenders. The Agent is hereby authorized to
amend any financing statements in order to include such Commercial Tort
Claim.
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due (i) any principal of
any Loan or any Reimbursement Obligations with respect to any Letter of
Credit, or (ii) any interest on any Loan, any fee or other Obligations
within five (5) days after such interest, fee or other Obligations becomes
due; or
(b) (1) the Borrower or any Guarantor shall fail to observe or
perform any covenant contained in SECTIONS 5.01(g), 5.02(ii), 5.03(a), 5.04
through 5.06, inclusive, 5.08, and 5.15 through 5.21; or (2) the Borrower
or any Guarantor shall fail to observe or perform any covenant contained in
SECTIONS 5.01(c), 5.01(d), 5.01(k) or 5.27 and such failure shall not have
been cured within 10 days after the earlier to occur of (i) written notice
thereof has been given to the Borrower and the Guarantors by the Agent or
(ii) a Senior Officer of the Borrower or any of the Guarantors otherwise
becomes aware of any such failure; or
(c) the Borrower or any Guarantor shall fail to observe or
perform any covenant or agreement contained or incorporated by reference in
this Agreement (other than those covered by paragraph (a) or (b) above) or
any Credit Document and such failure shall not have been cured within 30
days after the earlier to occur of (i) written notice thereof has been
given to the Borrower and the Guarantors by the Agent or (ii) a Senior
Officer of the Borrower or any of the Guarantors otherwise becomes aware of
any such failure; or
(d) any representation, warranty, certification or statement made
by the Borrower or any of the Guarantors in ARTICLE 4 of this Agreement or
in any certificate, financial statement or other document delivered
pursuant to this Agreement or any other Credit Document shall prove to have
been incorrect or misleading in any material respect when made (or deemed
made); or
(e) the Borrower, the Parent or any Material Subsidiary shall
fail to make any payment in respect of Debt outstanding (other than the
Notes) in an aggregate principal amount of $3,000,000 or more when due or
within any applicable grace period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt outstanding of the Borrower, the
Parent or any Material Subsidiary in an aggregate principal amount of
$3,000,000 or more (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower, the Parent or any
Material
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Subsidiary) or enables (or, with the giving of notice or lapse of time or
both, would enable) the holders of such Debt or commitment or any Person
acting on such holders' behalf to accelerate the maturity thereof or
terminate any such commitment prior to its normal expiration (including,
without limitation, any required mandatory prepayment or "put" of such Debt
to the Borrower, the Parent or any Material Subsidiary); or
(g) the Borrower, the Parent or any Material Subsidiary shall
commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the benefit of
creditors, or shall fail generally, or shall admit in writing its
inability, to pay its debts as they become due, or shall take any corporate
action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Borrower, the Parent or any Material Subsidiary seeking
liquidation, reorganization or other relief with respect to it or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of its
property, and such involuntary case or other proceeding shall remain
undismissed and unstayed for a period of 60 days; or an order for relief
shall be entered against the Borrower, the Parent or any Material
Subsidiary under the federal bankruptcy laws as now or hereafter in effect;
or
(i) the Borrower, the Parent or any Material Subsidiary or any
member of the Controlled Group shall fail to pay when due any material
amount which it shall have become liable to pay to the PBGC or to a Plan
under Title IV of ERISA; or notice of intent to terminate a Plan or Plans
shall be filed under Title IV of ERISA by the Borrower, the Parent, any
Material Subsidiary, any member of the Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any such Plan or Plans or a
proceeding shall be instituted by a fiduciary of any such Plan or Plans to
enforce SECTION 515 or 4219(c)(5) of ERISA and such proceeding shall not
have been dismissed within 30 days thereafter; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any such Plan or Plans must be terminated; or
(j) (i) one or more judgments or orders of any court or other
judicial body for the payment of money in an aggregate amount in excess of
$3,000,000 (in excess of amounts covered by insurance) shall be rendered
after the Closing Date against the Borrower, the Parent or any Material
Subsidiary and such judgment or order shall either continue unsatisfied,
unbonded, unvacated or unstayed for a period of 30 days or give rise to a
Lien on any Collateral at any time; or (ii) a warrant or writ of attachment
or execution or similar process shall be issued against any property of the
Borrower, the Parent or any Material Subsidiary which exceeds, individually
or together with all other such warrants, writs and processes since the
Closing Date, $3,000,000 (in excess of amounts covered by insurance) and
such warrant, writ or process shall not be discharged, vacated, stayed or
bonded for a period of 30 days; provided, however, that in
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the event a bond has been issued in favor of the claimant or other Person
obtaining such attachment or writ, any Lien the issuer of such bond may
have on the assets of the Borrower, the Parent or any Material Subsidiary
is subordinate to the Lien of the Agent; or
(k) (i) any Person or two or more Persons acting in concert (in
either case, excluding Furakawa) shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange Commission
under the Securities Exchange Act of 1934) of 30% or more of the
outstanding shares of the voting stock of the Parent; or (ii) as of any
date a majority of the Board of Directors of the Parent consists of
individuals who were not either (A) directors of the Parent as of the
corresponding date of the previous year, (B) selected or nominated to
become directors by the Board of Directors of the Parent of which a
majority consisted of individuals described in clause (A), or (C) selected
or nominated to become directors by the Board of Directors of the Parent of
which a majority consisted of individuals described in clause (A) and
individuals described in clause (B); or
(l) there shall have occurred material uninsured damage to, or
loss, theft or destruction of, any material part of the Collateral there
shall have occurred material uninsured damage to, or loss, theft or
destruction of, any material part of the Collateral, or any security
interest of the Agent in any part of the Collateral, or the Lien on any
Real Property pursuant to any Mortgage, ceases to be a first priority
security interest or Lien, except for Permitted Encumbrances which are
permitted by the Security Documents to be prior to the security interest or
Lien of the Agent, or any Guarantor shall terminate or repudiate the
Guaranty or the Guaranty shall be declared unenforceable or the Guaranty
shall no longer be in full force and effect; or
(m) the occurrence of any event, act, occurrence, or condition
which the Required Lenders determine either does or has a reasonable
probability of materially adversely affecting (i) the availability of the
rights and remedies of the Agent or the Lenders under this Agreement or any
of the Security Documents or the Agent's security interest and Lien against
the Collateral, as applicable, or (ii) the legality, validity or
enforceability of any Credit Document;
(n) the Borrower or any Guarantor repudiates, revokes or attempts
to repudiate or revoke its obligations with respect to the Obligations or
under the Credit Documents to which it is a party; or
(o) any strike, lockout, labor dispute, embargo, condemnation,
act of God or public enemy, or other casualty or injunction, court order,
or order or act of a governmental authority which causes, for more than 30
consecutive days beyond the coverage period of any applicable business
interruption insurance, the cessation or substantial curtailment of revenue
producing activities at any facility of the Borrower, the Parent or any
Material Subsidiary if any such event or circumstance could reasonably be
expected to have a Material Adverse Effect;
then, and in every such event, the Agent will, if requested by the Required
Lenders: (i) by notice to the Borrower terminate the Commitments and they
shall thereupon terminate and terminate the LC Issuer's obligations to
issue Letters of Credit hereunder; (ii) by notice to the Borrower declare
the Notes (together with accrued interest thereon), and all other amounts
payable hereunder and under the other Credit Documents, to be, and the same
shall thereupon become immediately due and payable without presentment,
demand, protest or other notice of any kind,
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all of which are hereby waived by the Borrower together with interest at
the Default Rate accruing on the principal amount thereof from and after
the date of such Event of Default; provided that if any Event of Default
specified in paragraph (g) or (h) above occurs with respect to the
Borrower, without any notice to the Borrower or any other act by the Agent
or the Lenders, the Commitments shall thereupon terminate and the Notes
(together with accrued interest thereon) and all other amounts payable
hereunder and under the other Credit Documents shall automatically and
without notice become immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived
by the Borrower together with interest thereon at the Default Rate accruing
on the principal amount thereof from and after the date of such Event of
Default; or (iii) exercise any rights, powers or remedies under this
Agreement and the other Credit Documents. In addition, upon the occurrence
of an Event of Default, to the extent of any existing Letter of Credit
Obligations, the Agent may immediately advance the amount thereof as a
Revolving Loan and set aside the amounts so advanced as a collateral
reserve for payment of the Reimbursement Obligations relating to Letters of
Credit which are subsequently funded. After all Letters of Credit have been
cancelled and all Reimbursement Obligations have been satisfied, and the LC
Issuer has been reimbursed all amounts funded by it with respect thereto,
any balance remaining in said collateral reserve may be applied to other
amounts owed by the Borrower hereunder, and, if none, shall be remitted to
the Borrower. Notwithstanding the foregoing, the Agent shall have available
to it all other remedies at law or equity, and shall exercise any one or
all of them at the request of the Required Lenders. In no event may any
Lender or Lenders exercise any rights, remedies or powers with respect to
the Obligations of the types described in clauses (a) and (b) of the
definition thereof, this Credit Agreement and the other Credit Documents
without the consent of the Agent and the Required Lenders.
SECTION 6.02. Notice of Default. The Agent shall give notice to
the Borrower, with a copy to the Guarantors, of any Default promptly upon
being requested to do so by any Lender and shall thereupon notify all the
Lenders thereof.
SECTION 6.03. Remedies with Respect to Collateral.
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(a) Upon the occurrence of an Event of Default, the Agent or any
representative of Agent shall have the right to exercise any one, or more,
or all of the rights, powers and remedies under the Mortgages, and also
shall have the rights and remedies of a secured party under the UCC in
effect on the date thereof (regardless of whether the same has been enacted
in the jurisdiction where the rights or remedies are asserted), including,
without limitation, the right to require the Borrower and the Guarantors to
assemble the Collateral, at the Borrower's and the Guarantors' expense, and
make it available to the Agent at a place designated by the Agent which is
reasonably convenient to both parties, and enter any premises where any of
the Collateral shall be located and to keep and store the Collateral on
said premises until sold (and if said premises be the property of the
Borrower or any of the Guarantors, the Borrower and the Guarantors agree
not to charge the Agent for storage thereof), to take possession of any of
the Collateral or the proceeds thereof, to sell or otherwise dispose of the
same, and the Agent shall have the right to conduct such sales on the
premises of the Borrower or any of the Guarantors, without charge therefor,
and such sales may be adjourned from time to time in accordance with
applicable law. The Agent may sell, lease or dispose of Collateral for
cash, credit, or any combination thereof, and shall have the right to
appoint a receiver of the Accounts and the
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Inventory or any part thereof, and the right to apply the proceeds
therefrom as set forth in SECTION 6.03(b) below. The Agent shall give the
Borrower and the Guarantors written notice of the time and place of any
public sale of the Collateral or the time after which any other intended
disposition thereof is to be made. The requirement of sending reasonable
notice shall be met if such notice is given to the Borrower and the
Guarantors at least 10 days before such disposition. Expenses of retaking,
verifying, restoring, holding, insuring, collecting, preserving,
liquidating, protecting, preparing for sale or selling, or otherwise
disposing of or the like with respect to the Collateral shall include, in
any event, reasonable attorneys' fees and other legally recoverable
collection expenses, all of which shall constitute a part of the
Obligations.
(b) Proceeds of any of the Collateral and payments by the
Borrower or any of the Guarantors during the existence of an Event of
Default received by the Agent or any Lender shall be applied by the Agent
in accordance with the provisions of SECTION 2.12(i), and, after all of the
Obligations have been paid in full and no Letters of Credit, ForEx
Obligations, or Interest Rate Protection Agreement or liability with
respect thereto remains outstanding, then, such excess proceeds shall be
payable to the Borrower and the Guarantors (as they may direct) or any
other Person as required by applicable law. In the event that the proceeds
of the Collateral are not sufficient to pay the Obligations in full, the
Borrower and the Guarantors shall remain liable for any deficiency.
(c) The Borrower and the Guarantors hereby waive all rights which
the Borrower and the Guarantors have or may have to notice and to a
judicial hearing prior to seizure of any Collateral by the Agent.
(d) Unless and except to the extent expressly provided for to the
contrary herein, the rights of the Agent specified herein shall be in
addition to, and not in limitation of, the Agent's or Lender's rights under
the UCC, or any other statute or rule of law or equity, or under any other
provision of any of the Credit Documents, or under the provisions of any
other document, instrument or other writing executed by the Borrower, any
of the Guarantors or any third party in favor of Agent, all of which may be
exercised successively or concurrently.
(e) The Agent is hereby granted a license or other right to use,
without charge, Borrower's labels, patents, copyrights, rights of use of
any name, trade secrets, tradenames, trademarks and advertising matter, or
any Property of a similar nature, as it pertains to the Collateral, in
advertising for sale and selling any Collateral, and the Borrower's and the
Guarantors' rights under all licenses and all franchise agreements shall
inure to the Agent's benefit.
(f) Neither the Agent nor any Lender shall be liable or
responsible in any way for the safekeeping of any of the Collateral or for
any loss or damage thereto (except the Agent for reasonable care in the
custody thereof while any Collateral is in the Agent's actual possession)
or for any diminution in the value thereof, or for any act or default of
any warehouseman, carrier, forwarding agency, or other person whomsoever,
but the same shall be at the Borrower's and the Guarantors' sole risk.
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(g) Neither the Agent nor any Lender shall be under any
obligation to marshal any assets in favor of any of the Borrower, any of
the Guarantors or any other Person or against or in payment of any or all
of the Obligations.
SECTION 6.04. Power of Attorney. The Borrower and each Guarantor
irrevocably designates and appoints the Agent its true and lawful attorney,
during the existence of an Event of Default, either in the name of the
Agent or in the name of such Borrower to ask for, demand, ▇▇▇ for, collect,
compromise, compound, receive, receipt for and give acquittances for any
and all sums owing or which may become due upon any items of the Inventory
or the Accounts and, in connection therewith, to take any and all actions
as the Agent may deem necessary or desirable to realize upon the Inventory
and the Accounts, including, without limitation, power to endorse in the
name of the Borrower or such Guarantor, any checks, drafts, notes or other
instruments received in payment of or on account of the Inventory or the
Accounts, but the Agent shall not be under any duty to exercise any such
authority or power or in any way be responsible for the collection of the
Inventory or the Accounts.
ARTICLE 7
THE AGENT AND THE LENDERS
SECTION 7.01. Appointment; Powers and Immunities.
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(a) Each Lender (and Wachovia or the LC Issuer, as applicable,
with respect to the Letter of Credit Obligations and the ForEx Obligations)
hereby irrevocably appoints and authorizes the Agent (including its
successors by merger) to act as its agent hereunder and under the other
Credit Documents with such powers as are specifically delegated to the
Agent by the terms hereof and thereof, together with such other powers as
are reasonably incidental thereto. The Agent: (i) shall have no duties or
responsibilities except as expressly set forth in this Agreement and the
other Credit Documents, and shall not by reason of this Agreement or any
other Credit Document be a trustee for any Lender; (ii) shall not be
responsible to the Lenders for any recitals, statements, representations or
warranties contained in this Agreement or any other Credit Document, or in
any certificate or other document referred to or provided for in, or
received by any Lender under this Agreement or any other Credit Document,
or for the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Credit Document or any other
document referred to or provided for herein or therein or for any failure
by the Borrower or any Guarantor to perform any of its obligations
hereunder or thereunder; (iii) shall not be required to initiate or conduct
any litigation or collection proceedings hereunder or under any other
Credit Document except to the extent requested by the Required Lenders, and
then only on terms and conditions which do not, in the reasonable judgment
of the Agent, subject the Agent to any undue risk; and (iv) shall not be
responsible for any action taken or omitted to be taken by it hereunder or
under any other Credit Document or any other document or instrument
referred to or provided for herein or therein or in connection herewith or
therewith, except for its own gross negligence or willful misconduct. The
Agent may employ agents and attorneys-in-fact and shall not be responsible
for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The provisions of this ARTICLE 7 are
solely for the benefit of the Agent and the Lenders, and neither the
Borrower nor any Guarantor shall have any rights as a third party
beneficiary of any of the provisions hereof. In performing its functions
and duties under this Agreement and under the other Credit Documents,
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the Agent shall act solely as agent of the Lenders and does not assume and
shall not be deemed to have assumed any obligation towards or relationship
of agency or trust with or for the Borrower or the Guarantors. The duties
of the Agent shall be ministerial and administrative in nature, and the
Agent shall not have by reason of this Agreement or any other Credit
Document a fiduciary relationship in respect of any Lender. The Agent shall
remit to the Lenders, as soon as reasonably practical following receipt
thereof, all payments and other amounts received by it hereunder for the
account of the Lenders.
(b) Unless and until its authority to do so is revoked in writing
by the Required Lenders, the Agent alone shall be authorized to determine
whether any accounts or inventory of the Borrower or any Guarantor
constitute Eligible Accounts or Eligible Inventory, or whether to impose or
release any reserve, and to exercise its own credit judgment in connection
therewith, which determinations and judgments, if exercised in good faith,
shall exonerate Agent from any liability to any Lender or any other Person
for any errors in judgment.
(c) The Agent shall have the sole and exclusive right and
authority to (i) act as the disbursing and collecting agent for the Lenders
with respect to all payments and collections arising in connection with
this Agreement and the other Credit Documents; (ii) execute and deliver
each Credit Document (other than this Credit Agreement) on behalf of the
Lenders and accept delivery of each such agreement delivered by the
Borrower or any Guarantor or any other Person; (iii) act as collateral
agent for the Lenders for purposes of the perfection of all security
interests and Liens created by this Agreement or the Security Documents
with respect to all material items of the Collateral and, subject to the
direction of the Required Lenders, for all other purposes stated therein;
(iv) subject to the direction of the Required Lenders, manage, supervise or
otherwise deal with the Collateral; and (v) except as may be otherwise
specifically restricted by the terms of this Agreement and subject to the
direction of the Required Lenders, exercise all remedies given to the Agent
or Lenders with respect to any of the Collateral under the Credit Documents
relating thereto, or under applicable law or otherwise. As to any matters
not expressly provided for otherwise by this Agreement or any other Credit
Document, the Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and thereunder in accordance with
instructions signed by the Required Lenders, and such instructions of the
Required Lenders to the Agent in any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled to
rely upon any certification, notice or other communication (including any
thereof by telephone, telecopier, 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 or other experts selected by the Agent.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default (other than
the nonpayment of any of the Obligations) unless the Agent has received
written notice from a Lender or the Borrower or any Guarantor specifying
such Default or Event of Default and stating that such notice is a "Notice
of Default," each of the Lenders hereby agreeing to promptly notify in
writing the Agent of any Default to which such Lender obtains knowledge. In
the event that the Agent receives such a notice of the occurrence of a
Default or an Event of Default, the Agent shall give prompt notice
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thereof to the Lenders. The Agent shall give each Lender prompt notice of
each nonpayment of any of the Obligations whether or not it has received
any notice of the occurrence of such nonpayment.
SECTION 7.04. Rights of Agent and its Affiliates as a Lender.
With respect to the Loans made by the Agent and any Affiliate of the Agent,
Wachovia in its capacity as a Lender hereunder and any Affiliate of the
Agent or such Affiliate 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 Wachovia were not acting as the Agent, and the term
"Lender" or "Lenders" shall, unless the context otherwise indicates,
include Wachovia in its individual capacity and any Affiliate of the Agent
in its individual capacity. The Agent and any Affiliate of the Agent may
(without having to account therefor to any Lender) accept deposits from,
lend money to and generally engage in any kind of banking, trust or other
business with the Borrower and any of the Guarantors (and any of the
Borrower's or any Guarantor's Affiliates) as if Wachovia were not acting as
the Agent, and the Agent and any Affiliate of the Agent may accept fees and
other consideration from the Borrower or any Guarantor (in addition to any
agency fees and arrangement fees heretofore agreed to between the Borrower
and the Agent) for services in connection with this Agreement or any other
Credit Document or otherwise without having to account for the same to the
Lenders and Agent shall not be subject to any liability by reason of its
acting or refraining to act pursuant to any request of the Required Lenders
except as a result of its own willful misconduct or gross negligence.
SECTION 7.05. Indemnification. Each Lender severally agrees to
indemnify the Agent and hold the Agent harmless from, to the extent the
Agent shall not have been reimbursed by the Borrower, ratably in accordance
with its Commitment, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits (including, without
limitation, counsel fees and disbursements), and costs and expenses (but
not fees) Agent may be required to bear with respect to any lockbox or
collateral collection account arrangement, or disbursements of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against
the Agent in any way relating to or arising out of this Agreement or any
other Credit Document or any other documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby
(excluding, unless an Event of Default has occurred and is continuing, the
normal out-of-pocket administrative costs and expenses incident to the
performance of its agency duties hereunder) or the enforcement of any of
the terms hereof or thereof or any such other documents; 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 the Agent. If any
indemnity furnished to the Agent for any purpose shall, in the opinion of
the Agent, be insufficient or become impaired, the Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished.
SECTION 7.06. Payee of Note Treated as Owner. The Agent may deem
and treat each Person in whose name a Loan is registered as the owner
thereof for all purposes hereof unless and until a written notice of the
assignment or transfer thereof shall have been filed with the Agent and the
provisions of SECTION 10.08(c) have been satisfied. Any requests, authority
or consent of any Person who at the time of making such request or giving
such authority or consent is the holder of any Note shall be conclusive and
binding on any subsequent holder,
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transferee or assignee of that Note or of any Note or Notes issued in
exchange therefor or replacement thereof.
SECTION 7.07. Nonreliance on Agent and Other Lenders. Each Lender
agrees that it has, independently and without reliance on the Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and the
Guarantors and decision to enter into this Agreement and that it will,
independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not
taking action under this Agreement or any of the other Credit Documents.
Except as expressly provided in SECTION 7.03, the Agent shall not be
required to keep itself (or any Lender) informed as to the performance or
observance by the Borrower or any Guarantor of this Agreement or any of the
other Credit Documents or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Borrower,
any Guarantor or any other Person. Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders
by the Agent hereunder or under the other Credit Documents, the Agent shall
not have any duty or responsibility to provide any Lender with any credit
or other information concerning the affairs, financial condition or
business of the Borrower or any Guarantor or any other Person (or any of
their Affiliates) which may come into the possession of the Agent.
SECTION 7.08. Failure to Act. Except for action expressly
required of the Agent hereunder or under the other Credit Documents, the
Agent shall in all cases be fully justified in failing or refusing to act
hereunder and thereunder unless it shall receive further assurances to its
satisfaction by the Lenders of their indemnification obligations under
SECTION 7.05 against any and all liability and expense which may be
incurred by the Agent by reason of taking, continuing to take, or failing
to take any such action. In any event, if the Agent requests in writing the
authorization or direction of the Required Lenders (or all Lenders if
required) and the Lenders do not timely respond to such request in writing,
the Agent may act or refrain from acting with respect to the matters set
forth in such request by the Agent without liability to any of the Lenders
with respect to such matters.
SECTION 7.09. Resignation of Agent. Subject to the appointment
and acceptance of a successor Agent as provided below, the Agent may resign
at any time by giving notice thereof to the Lenders and the Borrower. Upon
any such resignation the Required Lenders shall have the right to appoint a
successor Agent, subject to the consent of the Borrower, if no Event of
Default is in existence, which consent shall not be unreasonably withheld
or delayed. If no successor Agent shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days
after the retiring Agent's notice of resignation, then the retiring Agent
may, on behalf of the Lenders and after consultation with the Borrower,
appoint a successor Agent. Any successor Agent shall be a Lender hereunder
or other bank or financial institution which has a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder. After any retiring Agent's
resignation hereunder as Agent, the provisions
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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
Agent hereunder.
SECTION 7.10. Joinder of Lenders. The rights, remedies, powers
and privileges conferred upon the Agent hereunder and under the other
Credit Documents may be exercised by the Agent without the necessity of the
joinder of any other parties unless otherwise required by applicable law.
SECTION 7.11. Agreements Regarding Collateral. Each Lender shall
have an interest, in accordance with its Commitment Percentage, in the
security interests and Liens in and to the Collateral and any other assets
granted and assigned to the Agent under the Credit Documents. The Lenders
hereby irrevocably authorize the Agent, at its option and in its
discretion, to release any Lien upon any Collateral (a) as authorized by
this Agreement or any of the other Credit Documents, (b) upon the
termination of the Commitments and payment or satisfaction of all of the
Obligations, or (c) constituting Equipment sold or disposed of in
accordance with the terms of this Agreement if the Borrower or the relevant
Guarantor certifies to the Agent that the disposition is made in compliance
with the terms of this Agreement (and the Agent may rely conclusively on
any such certificate, without further inquiry). Except as expressly
authorized or required by this Agreement or applicable law, the Agent shall
not execute any release or termination of any Lien upon any of the
Collateral without the prior written authorization of all Lenders. The
Agent shall have no obligation whatsoever to any of the Lenders to assure
that any of the Collateral exists or is owned by the Borrower or any
Guarantor or is cared for, protected or insured or has been encumbered, or
that the Agent's Liens have been properly or sufficiently or lawfully
created, perfected, protected or enforced or entitled to any particular
priority or to exercise at all or in any manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights or
powers granted or available to the Agent pursuant to this Agreement or any
of the other Credit Documents, it being understood and agreed that in
respect of the Collateral, or any act, omission or event related thereto,
the Agent may act in any manner it may deem appropriate, in its discretion,
given the Agent's own interests in the Collateral in its capacity as one of
the Lenders.
SECTION 7.12. Agent Field Examinations; Appraisals. The Agent
shall promptly, upon receipt thereof, forward to each Lender copies of the
results of any field examinations by the Agent with respect to the Borrower
or any Guarantor and any appraisals obtained by the Agent with respect to
any of the Collateral. The Agent shall have no liability to any Lender for
any errors in or omissions from any field examination or other examination
of the Borrower or any Guarantor or the Collateral, or in any such
appraisal, unless such error or omission was the direct result of the
Agent's willful misconduct.
SECTION 7.13. Designation of Co-Agent. It is the purpose of this
Agreement that there shall be no violation of any applicable law denying or
restricting the right of financial institutions to transact business as an
agent in any jurisdiction. It is recognized that, in case of litigation
under any of the Credit Documents, or in case the Agent deems that by
reason of present or future laws of any jurisdiction the Agent might be
prohibited from exercising any of the powers, rights or remedies granted to
the Agent or the Lenders hereunder or under any of the Credit Documents or
from holding title to or a Lien upon any Collateral or from taking any
other action which may be necessary hereunder or under any of the Credit
Documents, the Agent may
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appoint an additional Person or Persons as a separate collateral agent or
co-collateral agent which is not so prohibited from taking any of such
actions or exercising any of such powers, rights or remedies. If the Agent
shall appoint an additional Person as a separate collateral agent or
co-collateral agent as provided above, each and every remedy, power, right,
claim, demand or cause of action intended by this Agreement and any of the
Credit Documents and every remedy, power, right, claim, demand or cause of
action intended by this Agreement and any of the Credit Documents to be
exercised by or vested in or conveyed to the Agent with respect thereto
shall be exercisable by and vested in such separate collateral agent or
co-collateral agent, but only to the extent necessary to enable such
separate collateral agent or co-collateral agent to exercise such powers,
rights and remedies, and every covenant and obligation necessary to the
exercise thereof by such separate collateral agent or co-collateral agent
shall run to and be enforceable by any of them. Should any instrument from
the Lenders be required by the separate collateral agent or co-collateral
agent so appointed by the Agent in order more fully and certainly to vest
in and confirm to him or it such rights, powers, duties and obligations,
any and all of such instruments shall, on request, be executed,
acknowledged and delivered by the Lenders whether or not a Default or Event
of Default then exists. In case any separate collateral agent or
co-collateral agent, or a successor to either, shall die, become incapable
of acting, resign or be removed, all the estates, properties, rights,
power, duties and obligations of such separate collateral agent or
co-collateral agent, so far as permitted by applicable law, shall vest in
and be exercised by the Agent until the appointment of a new collateral
agent or successor to such separate collateral agent or co-collateral
agent.
SECTION 7.14. Replacement of Certain Lenders. If a Lender shall
have (a) failed to fund its Commitment Percentage of any Loan requested by
the Borrower which such Lender is obligated to fund under the terms of this
Agreement and which such failure has not been cured, (b) requested
compensation from the Borrower under SECTION 8.05 to recover increased
costs incurred by such Lender (or its parent or holding company) which are
not being incurred generally by the other Lenders (or their respective
parent or holding company), or (c) delivered (or its respective parent or
holding company shall have delivered) a notice pursuant to ARTICLE 8
claiming that such Lender (or its affiliate) is unable to extend
Euro-Dollar Loans to the Borrower for reasons not generally applicable to
the other Lenders, or if the Borrower withholds any amounts from any
payments made pursuant to this Agreement to any non-United States Lender
(any Lender described in the foregoing provisions of this SECTION 7.14, an
"Affected Lender"), then, in any such case and in addition to any other
rights and remedies that the Agent, any other Lender or the Borrower may
have against such Affected Lender, the Borrower or the Agent may make
written demand on such Affected Lender (with a copy to the Agent in the
case of a demand by the Borrower and a copy to the Borrower in the case of
a demand by the Agent) for the Affected Lender to assign, and such Affected
Lender shall assign pursuant to one or more duly executed Assignment and
Acceptances within 5 Business Days after the date of such demand, to one or
more Lenders willing to accept such assignment or assignments, or to one or
more Assignees approved by the Agent, all of such Affected Lender's rights
and obligations under this Agreement (including its Commitments and all
Obligations owing to it) in accordance with SECTION 10.08; provided,
however, the Agent shall have no duty to locate an Assignee for the
purposes of accepting such assignment. The Agent is hereby irrevocably
authorized to execute one or more Assignment and Acceptances as
attorney-in-fact for any Affected Lender which fails or refuses to execute
and deliver the same within 5 Business Days after the date of such demand.
The Affected Lender shall be entitled to receive, in case and
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concurrently with execution and delivery of each such Assignment and
Acceptance, all amounts owed to the Affected Lender hereunder or under any
other Credit Document, including the aggregate outstanding principal amount
of the Obligations owed to such Lender, together with accrued interest
thereon through the date of such assignment. Upon the replacement of any
Affected Lender pursuant to this SECTION 7.14, such Affected Lender shall
cease to have any participation in, entitlement to, or other right to share
in the Liens of the Agent in any Collateral and such Affected Lender shall
have no further liability to the Agent, any Lender or any other Person
under any of the Credit Documents (except with respect to events or
transactions which occur prior to the replacement of such Affected Lender),
including any commitment to make Loans or purchase any participations in
the Letters of Credit.
ARTICLE 8
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent reasonably determines that deposits in Dollars (in
the applicable amounts) are not being offered in the relevant market for
such Interest Period, or
(b) the Required Lenders advise the Agent that the London
Interbank Offered Rate, as reasonably determined by the Agent will not
adequately and fairly reflect the cost to such Lenders of funding the
relevant type of Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and
the Lenders, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the
obligations of the Lenders to make the type of Euro-Dollar Loans, or to
permit continuations or conversions into such type of Euro-Dollar Loans,
shall be suspended. Unless the Borrower notifies the Agent at least 2
Domestic Business Days before the date of any Borrowing of such type of
Euro-Dollar Loans for which a Notice of Borrowing, or continuation or
conversion into such type of Euro-Dollar Loans for which a Notice of
Continuation or Conversion has previously been given, has previously been
given that it elects not to borrow on such date, such Borrowing shall
instead be made as a Base Rate Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the adoption
of any applicable law, rule or regulation, or any change therein or any
existing or future law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof (any such agency being referred to as an "Authority"
and any such event being referred to as a "Change of Law"), or compliance
by any Lender (or its Lending Office) with any request or directive
(whether or not having the force of law) of any Authority shall make it
unlawful or impossible for any Lender (or its Lending Office) to make,
maintain or fund its Euro-Dollar Loans and such Lender shall so notify the
Agent, the Agent shall forthwith give notice thereof to the other Lenders
and the Borrower, whereupon until such Lender notifies the Borrower and the
Agent that the circumstances giving rise to such suspension no longer
exist, the obligation of such Lender to make Euro-Dollar shall be
suspended. Before giving any notice to the Agent pursuant to this SECTION,
such Lender shall designate a different Lending Office if such
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designation will avoid the need for giving such notice and will not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender. If
such Lender shall determine that it may not lawfully continue to maintain
and fund any of its outstanding Euro-Dollar Loans to maturity shall so
specify in such notice, the Borrower shall (i) immediately prepay in full
the then outstanding principal amount of each Euro-Dollar Loan of such
Lender, together with accrued interest thereon and any amount due such
Lender pursuant to SECTION 8.05(a) or (ii) immediately deposit the amount
of such prepayment and interest through the end of the Interest Period with
the Agent as cash collateral to secure the Obligations with the direction
and authorization given to the Agent to apply such cash collateral toward
payment of such Euro-Dollar Loan at the end of such Euro-Dollar Loan's
Interest Period. If the Borrower has prepaid the Euro-Dollar Loans in
accordance with clause (ii), concurrently with prepaying each such
Euro-Dollar Loan the Borrower shall borrow a Base Rate Loan in an equal
principal amount from such Lender (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other
Lenders), and such Lender shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return.
---------------------------------
(a) If after the date hereof, a Change of Law or compliance by
any Lender (or its Lending Office) with any request or directive (whether
or not having the force of law) of any Authority:
(i) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without
limitation, any such requirement imposed by the Board of
Governors of the Federal Reserve System, but excluding with
respect to any Euro-Dollar Loan any such requirement included in
an applicable Euro-Dollar Reserve Percentage) against assets of,
deposits with or for the account of, or credit or letter of
credit extended by, any Lender (or its Lending Office); or
(ii) shall impose on any Lender (or its Lending Office) or
on the United States market for certificates of deposit or the
London interbank market any other condition affecting its
Euro-Dollar Loans, Letters of Credit, its Notes or its obligation
to make Euro-Dollar Loans;
and the result of any of the foregoing is to increase the cost to
such Lender (or its Lending Office) of making or maintaining any Loan or
Letter of Credit, or to reduce the amount of any sum received or receivable
by such Lender (or its Lending Office) under this Agreement or under its
Notes with respect thereto, by an amount reasonably deemed by such Lender
to be material, then, within 30 days after demand by such Lender (with a
copy to the Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender for such increased cost or
reduction.
(b) If any Lender shall have determined in good faith that after
the date hereof the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof, or compliance by any Lender (or
its Lending Office) with any request or directive regarding capital
adequacy (whether
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or not having the force of law) of any Authority, has or would have the
effect of reducing the rate of return on such Lender's capital as a
consequence of its obligations (whether with respect to Loans or the
Letters of Credit) hereunder to a level below that which such Lender could
have achieved but for such adoption, change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy) by
an amount reasonably deemed by such Lender to be material, then from time
to time, within 30 days after demand by such Lender, the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such
Lender for such reduction.
(c) Each Lender will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Lender to compensation pursuant to this SECTION and
will designate a different Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Lender, be otherwise disadvantageous to such Lender;
provided that such Lender shall not be entitled to claim any additional
compensation pursuant to this SECTION if such Lender fails to provide such
notice to the Borrower within 90 days of the date such Lender becomes aware
of the occurrence of the event giving rise to the such claim.
(d) A certificate of any Lender claiming compensation under this
SECTION and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive in the absence of manifest error if rendered
in good faith. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
(e) The provisions of this SECTION 8.03 shall be applicable with
respect to any Participant, Assignee or other Transferee, and any
calculations required by such provisions shall be made based upon the
circumstances of such Participant, Assignee or other Transferee.
SECTION 8.04. Base Rate Loans or Other Euro-Dollar Loans
Substituted for Affected Euro-Dollar Loans. If (a) the obligation of any
Lender to make or maintain any type of Euro-Dollar Loans has been suspended
pursuant to SECTION 8.02 or (b) any Lender has demanded compensation under
SECTION 8.03, and the Borrower shall, by at least 5 Euro-Dollar Business
Days' prior notice to such Lender through the Agent, have elected that the
provisions of this SECTION shall apply to such Lender, then, unless and
until such Lender notifies the Borrower that the circumstances giving rise
to such suspension or demand for compensation no longer apply:
(a) all Loans which would otherwise be made by such Lender as
Euro-Dollar Loans shall be made instead as Base Rate Loans (in all cases
interest and principal on such Loans shall be payable contemporaneously
with the related Euro-Dollar Loans of the other Lenders), and
(b) after each of its Euro-Dollar Loans has been repaid, all
payments of principal which would otherwise be applied to repay such
Euro-Dollar Loans shall be applied to repay its Base Rate Loans instead.
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SECTION 8.05. Compensation. Upon the request of any Lender,
delivered to the Borrower and the Agent, the Borrower shall pay to such
Lender such amount or amounts as shall compensate such Lender for any loss,
cost or expense incurred by such Lender as a result of:
(a) any payment or prepayment (pursuant to SECTION 2.10, 2.11,
6.01, 8.02 or otherwise) of a Euro-Dollar Loan on a date other than the
last day of an Interest Period for such Loan; or
(b) if the Lenders permit prepayment of a Euro-Dollar Loan on any
day other than the last day of the Interest Period with respect thereto,
any failure by the Borrower to prepay such Euro-Dollar Loan on the date for
such prepayment specified in the relevant notice of prepayment; or
(c) any failure by the Borrower to borrow a Euro-Dollar Loan on
the date for the Euro-Dollar Borrowing of which such Euro-Dollar Loan is a
part specified in the applicable Notice of Borrowing delivered pursuant to
SECTION 2.02;
such compensation to include, without limitation, an amount equal to the
excess, if any, of (x) the amount of interest which would have accrued on
the amount so paid or prepaid or not prepaid or borrowed for the period
from the date of such payment, prepayment or failure to prepay or borrow to
the last day of the then current Interest Period for such Euro-Dollar Loan
(or, in the case of a failure to prepay or borrow, the Interest Period for
such Euro-Dollar Loan which would have commenced on the date of such
failure to prepay or borrow) at the applicable rate of interest for such
Euro-Dollar Loan provided for herein over (y) the amount of interest (as
reasonably determined by such Lender) such Lender would have paid on
deposits in Dollars of comparable amounts having terms comparable to such
period placed with it by leading banks in the London interbank market.
ARTICLE 9
CONDITIONS TO BORROWINGS AND ISSUANCE OF LETTERS OF CREDIT
SECTION 9.01. Conditions to Initial Borrowing and issuance of any
Letter of Credit. The obligation of each Lender to make a Loan or the LC
Issuer to issue a Letter of Credit on the occasion of the initial Borrowing
or issuance of a Letter of Credit is subject to the satisfaction of the
conditions set forth in SECTION 9.02 and receipt by the Agent of the
following (as to the documents described in paragraphs (a), (c), (d) and
(e) below, in sufficient number of counterparts for delivery of a
counterpart to each Lender and retention of one counterpart by the Agent):
(a) from each of the parties hereto of either (i) a duly executed
counterpart of this Agreement signed by such party or (ii) a facsimile
transmission of such executed counterpart, with the original to be sent to
the Agent by overnight courier;
(b) a duly executed Revolving Loan Note for the account of each
Lender and a duly executed Settlement Loan Note for Wachovia, in each case
complying with the provisions of SECTION 2.04;
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(c) an opinion letter (i) from each of of ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇,
General Counsel, and ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.A., special counsel,
for the Borrower, the Parent and the Initial Subsidiary Guarantors, dated
as of the Closing Date, substantially in the forms of EXHIBIT B-1 and B-2,
respectively, and covering such additional matters relating to the
transactions contemplated hereby as the Agent or any Lender may reasonably
request, and (ii) of local counsel to the Agent in the States of in which
the Real Properties are located, dated as of the Closing Date or the date
on which any Real Property is added thereafter, substantially in the form
of EXHIBIT B-3 regarding the Mortgage as to any Property located in the
state in which such counsel is located (which opinion as of the Closing
Date is included in the aforesaid opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
P.A.);
(d) an opinion of ▇▇▇▇▇ Day, special counsel for the Agent, dated
as of the Closing Date, substantially in the form of EXHIBIT C and covering
such additional matters relating to the transactions contemplated hereby as
the Agent may reasonably request;
(e) a certificate (the "Closing Certificate") substantially in
the form of EXHIBIT H, dated as of the Closing Date, signed by a principal
financial officer of the Borrower and each of the Guarantors, to the effect
that (i) no Default has occurred and is continuing on the date of the first
Borrowing under this Agreement, and (ii) the representations and warranties
of the Borrower and the Guarantors contained in ARTICLE 4 are true in all
material respects on and as of the date of the first Borrowing
hereunder(except to the extent any such representation or warranty is
expressly stated to have been made as of a specific earlier date);
(f) all documents which the Agent or any Lender may reasonably
request relating to the existence of the Borrower, the Parent and each of
the Initial Subsidiary Guarantors, the corporate authority for and the
validity of this Agreement, the Notes and the other Credit Documents to
which it is a party and any other matters relevant hereto, all in form and
substance satisfactory to the Agent, including, without limitation, a
certificate of each of the Borrower, the Parent and each of the Initial
Subsidiary Guarantors substantially in the form of EXHIBIT I (the
"Officer's Certificate"), signed by the Secretary or an Assistant Secretary
of the Borrower, the Parent or such Initial Subsidiary Guarantor,
certifying as to the names, true signatures and incumbency of the officer
or officers of the Borrower, the Parent or such Initial Subsidiary
Guarantor authorized to execute and deliver the Credit Documents to which
it is a party, and certified copies of the following items: (i) the
Borrower's, the Parent or such Initial Subsidiary Guarantor's Certificate
of Incorporation or Certificate of Organization, (ii) the Borrower's, the
Parent or such Initial Subsidiary Guarantor's Bylaws or Operating
Agreement, (iii) as to the Borrower, the Parent and each Initial Subsidiary
Guarantor, a certificate of good standing or valid existence of the
Secretary of State of the State of the jurisdiction of its incorporation
and of each State in which it is qualified to do business as a foreign
corporation, and (iv) the action taken by the Board of Directors of the
Borrower, the Parent or such Initial Subsidiary Guarantor, authorizing the
Borrower's, the Parent or such Initial Subsidiary Guarantor's execution,
delivery and performance of this Agreement, the Notes and the other Credit
Documents to which the Borrower, the Parent or such Initial Subsidiary
Guarantor is a party;
(g) an initial Borrowing Base Certificate showing, after giving
effect to any Revolving Loan Borrowings on the Closing Date and the
application of the proceeds thereof, or
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issuance of Letters of Credit, and after the payment of fees and expenses
of this transaction, and after deduction for any past due accounts payable
and other obligations, that the Excess Borrowing Availability is at least
$50,000,000;
(h) two duly executed counterparts of each of the Contribution
Agreement, the Pledge Agreement, each Waiver Agreement requested by the
Agent, the Guaranty and the Collateral Disclosure Certificates,
(i) UCC-1 financing statements (satisfactory in form and content
to the Agent in all respects) pertaining to the Collateral shall have been
filed or are ready for filing in all filing offices deemed necessary by the
Agent;
(j) duly executed counterparts of the Mortgages, together with
the UCC-1 financing statements pertaining thereto;
(k) Real Property Documentation for each parcel of the Real
Properties (except to the extent waived or suspended as of the Closing Date
pursuant to the definition of Real Property Documentation, including the
types of Real Property Documentation described in clauses (vi) and (viii)
of such definition, which shall not be required as of the Closing Date);
(l) receipt of field examinations pertaining to the Borrower's
and the Guarantors' Accounts and Inventory acceptable to the Agent;
(m) receipt of confirmations of appraisals pertaining to the
Borrower's and the Guarantors' Equipment, reasonably acceptable to the
Agent, showing a net orderly liquidation value of not less than $28,047,000
for the Equipment;
(n) receipt of confirmation satisfactory to the Agent that the
Prior Credit Agreements have been terminated and all amounts payable
thereunder have been paid, with cash collateral securing any amount
outstanding under any letters of credit established thereunder, or other
arrangements satisfactory to the Agent have been made, pending the return
for cancellation thereof;
(o) the reasonable satisfaction of the Agent with the level and
condition of accounts payable of the Borrower;
(p) receipt of all consents and approvals of shareholders,
governmental entities and other third parties as are necessary in
connection with this transaction;
(q) receipt of projections reasonably satisfactory to the Agent
and the Arranger for the Parent and its Subsidiaries (i) prepared on a
quarterly basis for Fiscal Year 2003 and (ii) prepared on an annual basis
for Fiscal Years 2004 and 2005;
(r) receipt of lien searches reasonably acceptable to the Agent,
showing no Liens other than Permitted Encumbrances;
(s) completion by the Agent of all other due diligence and its
satisfaction in its sole discretion with the results thereof;
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(t) since December 31, 2001, except as disclosed in Schedule
4.04, no Material Adverse Effect shall have occurred and be continuing;
(u) evidence of insurance as required by this Agreement;
(v) delivery to the Agent of a Telephone Instruction Letter in
substantially the form of EXHIBIT K;
(w) payment of all fees owed to the Agents and the Lenders
hereunder and due and payable as of or prior to the Closing Date;
(x) a Notice of Borrowing for any Borrowing on the Closing Date;
(y) establishment of the lockboxes and the Collateral Reserve
Accounts and execution of the Deposit Account Control Agreements, as
required by SECTION 2.15(a); and
(z) a sources and uses of funds statement, along with an
authorization and direction from the Borrower with respect to any Loans
advanced or Letters of Credit issued on the Closing Date.
In addition, if the Borrower desires funding of a Euro-Dollar
Loan on the Closing Date, the Agent shall have received, the requisite
number of days prior to the Closing Date, a funding indemnification letter
satisfactory to it, pursuant to which (A) the Agent and the Borrower shall
have agreed upon the interest rate, amount of Borrowing and Interest Period
for such Euro-Dollar Loan, and (B) the Borrower shall indemnify the Lenders
from any loss or expense arising from the failure to close on the
anticipated Closing Date identified in such letter or the failure to borrow
such Euro-Dollar Loan on such date.
SECTION 9.02. Conditions to All Borrowings and Issuances of
Letters of Credit. The obligation of each Lender to make a Loan, or the LC
Issuer to issue a Letter of Credit, on the occasion of each Borrowing or
issuance of a Letter of Credit is subject to the satisfaction of the
following conditions:
(a) except for Refunding Loans made as Base Rate Loans, the fact
that, immediately before and after such Borrowing or issuance of a Letter
of Credit, no Default shall have occurred and be continuing;
(b) the fact that the representations and warranties of the
Borrower and the Guarantors contained in ARTICLE 4 shall be true in all
material respects on and as of the date of such Borrowing or issuance of a
Letter of Credit (except to the extent any such representation or warranty
is expressly stated to have been made as of a specific earlier date); and
(c) the fact that, immediately after such Borrowing or issuance
of a Letter of Credit, the conditions set forth in clauses (i) and (ii) of
SECTION 2.01(a) shall have been satisfied.
Each Syndicated Borrowing, each Settlement Loan Borrowing, each
Notice of Continuation or Conversion and each issuance of a Letter of
Credit hereunder shall be deemed to
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be a representation and warranty by the Borrower and the Guarantors on the
date of such Borrowing or issuance of a Letter of Credit as to the truth
and accuracy of the facts specified in paragraphs (a), (b) and (c) of this
SECTION; provided, that if such Borrowing is a Syndicated Borrowing which
consists solely of a Refunding Loan then, (i) if such Borrowing is a
Euro-Dollar Borrowing or such Notice of Continuation or Conversion is to a
Euro-Dollar Rate Loan, such Borrowing or Notice of Continuation or
Conversion shall be deemed to be such a representation and warranty by the
Borrower and the Guarantors only as to the matters set forth in paragraphs
(a) and (c) above, and (ii) if such Borrowing is a Base Rate borrowing, or
such Notice of Continuation or Conversions is to a Base Rate Loan, such
Borrowing or Notice of Continuation or Conversion shall be deemed to be a
representation and warranty by the Borrower and the Guarantors only as to
the matters set forth in paragraph (c) above.
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including
telecopier or similar writing) and shall be given to such party at its
address or telecopier number set forth on the signature pages hereof or
such other address or telecopier number as such party may hereafter specify
for the purpose by notice to each other party. Each such notice, request or
other communication shall be effective (a) if given by telecopier, when
such telecopy is transmitted to the telecopier number specified in this
SECTION and the confirmation is received, (b) if given by mail, 72 hours
after such communication is deposited in the mail with first class postage
prepaid, addressed as aforesaid or (c) if given by any other means, when
delivered at the address specified in this SECTION; provided that notices
to the Agent under ARTICLE 2 or ARTICLE 8 and notices to the Borrower under
SECTION 6.01 shall not be effective until received.
SECTION 10.02. No Waivers. The failure of the Borrower to
satisfy, or the waiver by the Agent and the Lenders of, any condition set
forth in ARTICLE 9 shall not constitute a waiver of any such condition with
respect to any subsequent advance of a Loan, unless such waiver is
expressly agreed to in writing as required by SECTION 10.06. No failure or
delay by the Agent or any Lender in exercising any right, power or
privilege hereunder or under any Note or other Credit Document shall
operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 10.03. Expenses; Documentary Taxes. The Borrower shall
pay (a) all reasonable out-of-pocket expenses (including, without
limitation, all reasonable attorney and paralegal fees and expenses of the
Agent, recording costs, recording or intangible taxes and title insurance,
if any) of the Agent incurred in connection with this Agreement and the
other Credit Documents, including, without limitation, (i) all reasonable
costs, fees and taxes pertaining to the obtaining, preparation or filing of
all equipment appraisals , audit reports and field examinations (except as
expressly limited by SECTION 5.29), lien searches, UCC-1 financing
statements (including, without limitation, any release thereof), the
Mortgages, the Real Property Documentation, (ii) all reasonable fees and
disbursements of special counsel for the Agent, (iii) all reasonable costs
and fees incurred in connection with the preparation, negotiation,
CONFIDENTIAL
administration and execution and delivery of this Agreement and the other
Credit Documents, and any waiver or consent hereunder or thereunder or any
amendment hereof or thereof or any Default or alleged Default hereunder or
thereunder, (iv) sums paid or incurred to pay for any amount or to take any
action required of the Borrower or any Guarantor hereunder or under this
Agreement that the Borrower fails to pay or take as required under this
Agreement; and (b) during the existence of an Event of Default, reasonable
costs and expenses (including reasonable attorney and paralegal fees and
expenses of special counsel for the Agent and the Lenders and reasonable
costs and expenses of financial consultants) paid or incurred to obtain
payment of the Obligations, enforce the Lien in the Collateral, preserve
and protect the Collateral, sell or otherwise realize upon the Collateral,
and otherwise enforce the provisions hereof or of any Credit Document or to
defend any claim made or threatened against the Agent or any of the Lenders
arising out of the transactions contemplated hereby (including, without
limitation, preparations for and consultations concerning any such
matters). The foregoing shall not be construed to limit any other
provisions hereof, or of any Credit Document regarding costs and expenses
to be paid by the Borrower. In the event the Borrower or any Guarantor
becomes a debtor under the Bankruptcy Code, the Agent's and each Lender's
secured claim in such case shall include interest on the Obligations and
all fees, costs and charges provided for herein (including, without
limitation, reasonable attorneys' fees actually incurred), all to the
extent allowed by the Bankruptcy Code. The Borrower shall indemnify the
Agent and each Lender against any transfer taxes, documentary taxes,
assessments or charges made by any Authority by reason of the execution and
delivery of this Agreement or the other Credit Documents.
SECTION 10.04. Indemnification. The Borrower shall indemnify the
Agent, the Arranger, the Lenders and each Affiliate thereof and their
respective directors, officers, employees and agents from, and hold each of
them harmless against, any and all losses, liabilities, claims or damages
to which any of them may become subject, insofar as such losses,
liabilities, claims or damages arise out of or result from any actual or
proposed use by the Borrower of the proceeds of any extension of credit by
any Lender hereunder or breach by the Borrower of this Agreement or any
other Credit Document or from any investigation, litigation (including,
without limitation, any actions taken by the Agent or any of the Lenders to
enforce this Agreement or any of the other Credit Documents) or other
proceeding (including, without limitation, any threatened investigation or
proceeding) relating to the foregoing or related to the syndication of this
credit facility, and the Borrower shall reimburse the Agent and each
Lender, and each Affiliate thereof and their respective directors,
officers, employees and agents, upon demand for any expenses (including,
without limitation, legal fees) incurred in connection with any such
investigation or proceeding; but excluding any such losses, liabilities,
claims, damages or expenses incurred by reason of the gross negligence or
willful misconduct of the Person (or agent thereof) to be indemnified.
SECTION 10.05. Setoff; Sharing of Setoffs.
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(a) The Borrower and each Guarantor hereby grants to the Agent
and each Lender, and to Wachovia as to the Settlement Loans, the ForEx
Obligations and the LC Issuer as to the Letter of Credit Obligations, a
lien on all Obligations owing to them from the Borrower or such Guarantor
upon all deposits or deposit accounts, of any kind, or any interest in any
deposits or deposit accounts thereof, now or hereafter pledged, mortgaged,
transferred or assigned to the Agent or any such
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Lender or otherwise in the possession or control of the Agent or any such
Lender for any purpose for the account or benefit of the Borrower or such
Guarantor and including any balance of any deposit account or of any credit
of the Borrower or such Guarantor with the Agent or any such Lender,
whether now existing or hereafter established hereby authorizing the Agent
and each Lender at any time or times upon the occurrence and during the
continuance of an Event of Default with or without prior notice to apply
such balances or any part thereof to such of the Obligations owing by the
Borrower or such Guarantor to the Lenders, Wachovia, the LC Issuer and/or
the Agent then past due and in such amounts as they may elect, and whether
or not the Collateral or other collateral, if any, or the responsibility of
other Persons primarily, secondarily or otherwise liable may be deemed
adequate. The Agent appoints, authorizes and directs each Lender to act as
a collateral sub-agent for the Agent and the Lenders with respect to any
property of the Borrower or any Guarantor left with such Lender or in the
possession, custody or control now or hereafter of such Lender, all Deposit
Accounts of the Borrower and any Guarantor now or hereafter opened with
such Lender, all certificates of deposit issued by such Lender to the
Borrower or any Guarantor, and all Instruments, drafts, checks and other
items deposited in or with such Lender by the Borrower or any Guarantor for
collection now or hereafter. For the purposes of this paragraph, all
remittances and property shall be deemed to be in the possession of the
Agent, Wachovia, the LC Issuer or any such Lender as soon as the same may
be put in transit to it by mail or carrier or by other bailee.
(b) Each Lender and the LC Issuer agrees that if it shall, by
exercising any right of setoff (with the consent or direction of the
Required Lenders) or counterclaim or resort to collateral security or
otherwise, receive payment of a proportion of the aggregate amount of the
principal and interest owing with respect to the Loans held by it, or the
Letter of Credit Obligations which is greater than the proportion received
by any other Lender in respect of the aggregate amount of all principal and
interest owing with respect to the Loans held by such other Lender or the
LC Issuer with respect to the Letter of Credit Obligations, the Lender or
the LC Issuer receiving such proportionately greater payment shall purchase
such participations in the Loans held by the other Lenders owing to such
other Lenders or the LC Issuer and the Letter of Credit Obligations, and
such other adjustments shall be made, as may be required so that all such
payments of principal and interest with respect to the Loans held by the
Lenders owing to such other Lenders and the Letter of Credit Obligations
shall be shared by the Lenders and the LC Issuer in accordance with their
Commitment Percentage; provided that (i) nothing in this SECTION shall
impair the right of any Lender to exercise any right of setoff or
counterclaim it may have and to apply the amount subject to such exercise
to the payment of indebtedness of the Borrower other than its indebtedness
under the Loans or the Letter of Credit Obligations, and (ii) if all or any
portion of such payment received by the purchasing Lender is thereafter
recovered from such purchasing Lender, such purchase from each other Lender
or the LC Issuer shall be rescinded and such other Lender or the LC Issuer
shall repay to the purchasing Lender or the LC Issuer the purchase price of
such participation to the extent of such recovery together with an amount
equal to such other Lender's or the LC Issuer's ratable share (according to
the proportion of (A) the amount of such other Lender's or the LC Issuer's
required repayment to (B) the total amount so recovered from the purchasing
Lender or the LC Issuer) of any interest or other amount paid or payable by
the purchasing Lender or the LC Issuer in respect of the total amount so
recovered. The Borrower and each of the Guarantors agrees, to the fullest
extent it may effectively do so under applicable law, that any holder of a
participation in a Loan, or risk participant with respect to the Letter of
Credit Obligations, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of setoff or counterclaim and other
rights with
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respect to such participation as fully as if such holder of a participation
were a direct creditor of the Borrower or such Guarantor in the amount of
such participation.
SECTION 10.06. Amendments and Waivers.
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(a) Any provision of this Agreement, the Notes or any other
Credit Documents may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower (and the Guarantors,
to the extent party to the applicable Credit Document) and the Required
Lenders (and, if the rights or duties of the Agent are affected thereby, by
the Agent); provided that, no such amendment or waiver shall, (1) unless
signed by all Lenders directly affected thereby, (i) change the Commitment
of such Lender or subject such Lender to any additional obligation, (ii)
reduce the principal of or rate of interest on any Loan or any fees (other
than fees payable to the Agent) hereunder, (iii) change the date fixed for
any payment of principal of or interest on any Loan or any fees hereunder,
or (iv) reduce the amount of principal, interest or fees due on any date
fixed for the payment thereof, and (2) unless signed by all Lenders, (i)
increase the aggregate amount of the Commitments, (ii) change the
percentage of the Commitments or of the aggregate unpaid principal amount
of the Revolving Loan Notes, or the percentage of Lenders, which shall be
required for the Lenders or any of them to take any action under this
SECTION or any other provision of this Agreement, (iii) change the manner
of application of any payments made under this Agreement or the Notes, or
the provisions with respect to pro rata treatment among Lenders (including,
without limitation, as to sharing of payments and expenses), (iv) except as
expressly provided in this Agreement (including, without limitation,
SECTION 5.30) or any of the other Credit Documents, release or substitute,
or agree to subordination of, the Collateral held as security for the
Loans, (v) release any Guarantor or the Guaranty or any other Guarantee
given to support payment of the Loans, (vi) change the definitions of
"Borrowing Base," "Eligible Accounts," "Eligible Inventory," or "Required
Lenders", (vii) change the provisions of any of ARTICLE 7 or SECTIONS 10.04
or 10.20, or (viii) change the several nature of the obligations of the
Lenders under their respective Commitments; and provided further that, no
provision of this Agreement relating to Settlement Loans, ForEx Obligations
and Letter of Credit Obligations may be amended without the prior written
consent of the LC Issuer or Wachovia, as applicable.
(b) The Borrower will not solicit, request or negotiate for or
with respect to any proposed waiver or amendment of any of the provisions
of this Agreement except through the Agent, or unless each Lender shall be
informed thereof by the Borrower and shall be afforded an opportunity of
considering the same and shall be supplied by the Borrower with sufficient
information to enable it to make an informed decision with respect thereto.
Executed or true and correct copies of any waiver or consent effected
pursuant to the provisions of this Agreement shall be delivered by the
Borrower to the Agent (for distribution to each Lender) forthwith following
the date on which the same shall have been executed and delivered by the
requisite percentage of Lenders. The Borrower will not, directly or
indirectly, pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, to any Lender (in
its capacity as such) as consideration for or as an inducement to the
entering into by such Lender of any waiver or amendment of any of the terms
and provisions of this Agreement unless such remuneration is concurrently
paid, on the same terms, ratably to all such Lenders.
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SECTION 10.07. No Margin Stock Collateral. Each of the Lenders
represents to the Agent and each of the other Lenders that it in good faith
is not, directly or indirectly (by negative pledge or otherwise), relying
upon any Margin Stock as collateral in the extension or maintenance of the
credit provided for in this Agreement.
SECTION 10.08. Successors and Assigns.
----------------------
(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors
and assigns; provided that the Borrower may not assign or otherwise
transfer any of its rights under this Agreement.
(b) Any Lender may at any time sell to one or more Persons (each
a "Participant") participating interests in any Loan owing to such Lender,
any Note held by such Lender, any Commitment hereunder or any other
interest of such Lender hereunder; provided, however, that if a Lender is
selling a participation in only a portion of its Commitment or any other
interest of such Lender hereunder, the participation being sold (determined
as of the effective date of the sale of the participation) shall be in an
amount not less than $5,000,000. In the event of any such sale by a Lender
of a participating interest to a Participant, such Lender's obligations
under this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain
the holder of any such Note for all purposes under this Agreement, and the
Borrower and the Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. In no event shall a Lender that sells a participation be
obligated to the Participant to take or refrain from taking any action
hereunder except that such Lender may agree that it will not (except as
provided below), without the consent of the Participant, agree to (i) the
change of any date fixed for the payment of principal of or interest on the
related loan or loans, (ii) the change of the amount of any principal,
interest or fees due on any date fixed for the payment thereof with respect
to the related loan or loans, (iii) the change of the principal of the
related loan or loans, (iv) any change in the rate at which either interest
is payable thereon or (if the Participant is entitled to any part thereof)
fee is payable hereunder from the rate at which the Participant is entitled
to receive interest or fee (as the case may be) in respect of such
participation, (v) the release or substitution of all or any substantial
part of the collateral (if any) held as security for the Loans, or (vi) the
release of any Guarantee given to support payment of the Loans. Each Lender
selling a participating interest to any Person other than an Affiliate or
Related Fund of such Lender in any Loan, Note, Commitment or other interest
under this Agreement, will, within 10 Domestic Business Days of such sale,
provide the Borrower and the Agent with written notification stating that
such sale has occurred and identifying the Participant and the interest
purchased by such Participant. The Borrower agrees that each Participant
shall be entitled to the benefits of ARTICLE 8 with respect to its
participation in Loans outstanding from time to time.
(c) Any Lender may at any time assign to one or more Persons,
provided that any such Person is a commercial bank, finance company,
insurance company or other financial institution or fund which, in each
case, in the ordinary course of business extends credit of the type
contemplated herein and whose becoming an assignee would not constitute a
prohibited transaction under Section 4975 of ERISA, is organized under laws
of the United States of America or any state and having total assets in
excess of $5,000,000,000 or an affiliate or
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Related Fund of any such Person, and is acceptable to Agent in its sole
discretion (each an "Assignee") all or a proportionate part of its rights
and obligations under this Agreement, the Notes and the other Credit
Documents, and such Assignee shall assume all such rights and obligations,
pursuant to an Assignment and Acceptance, executed by such Assignee, such
transferor Lender and the Agent (and, in the case of an Assignee that is
not then a Lender, subject to clause (iii) below, by the Borrower);
provided that (i) no interest may be sold by a Lender pursuant to this
paragraph (c) unless the Assignee shall agree to assume ratably equivalent
portions of the transferor Lender's Commitment, (ii) if a Lender is
assigning only a portion of its Commitment, then, the amount of the
Commitment being assigned (determined as of the effective date of the
assignment) shall be in an amount not less than $5,000,000, (iii) no
interest may be sold by a Lender pursuant to this paragraph (c) to any
Assignee that is not then a Lender (or an Affiliate or Related Fund of a
Lender) without the prior written consent of the Agent, and, unless a
Default or Event of Default is in existence, the Borrower (whose consent
shall not be unreasonably withheld or delayed), and (iv) a Lender may not
have more than 3 Assignees that are not then Lenders (or an Affiliate or
Related Fund thereof) at any one time. Upon (v) execution of the Assignment
and Acceptance by such transferor Lender, such Assignee, the Agent and (if
applicable) the Borrower, (w) delivery of an executed copy of the
Assignment and Acceptance to the Borrower and the Agent, (x) payment by
such Assignee to such transferor Lender of an amount equal to the purchase
price agreed between such transferor Lender and such Assignee, (y) payment
of a processing and recordation fee of $4,000 to the Agent, and (z)
recordation of such assignment on the Register, as defined and provided
below, such Assignee shall for all purposes be a Lender party to this
Agreement and shall have all the rights and obligations of a Lender under
this Agreement to the same extent as if it were an original party hereto
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 the Borrower, the
Lenders or the Agent shall be required. The Borrower hereby designates the
Agent to serve as the Borrower's agent, solely for purposes of this SECTION
10.08(c), to maintain a register (the "Register") on which it will record
the Commitments from time to time of each of the Lenders, the Loans made by
each of the Lender and each repayment in respect of the principal amount of
the Loans of each Lender. Failure to make any such recordation, or any
error in such recordation shall not affect the Borrower's obligations in
respect of such Loans. With respect to any Lenders, the transfer of any
Commitment of such Lenders and the rights to the principal of, and interest
on, any Loan shall not be effective until such transfer is recorded on the
Register maintained by the Agent with respect to ownership of such
Commitment and Loans and prior to such recordation all amounts owing to the
transferor with respect to such Commitment and Loans shall remain owing to
the transferor. The registration of assignment or transfer of all or part
of any Commitment and Loans shall be recorded by the Agent on the Register
only upon the acceptance by the Agent of a properly executed and delivered
Assignment and Acceptance pursuant to this SECTION 10.08(c). Coincident
with the delivery of such an Assignment and Acceptance to the Agent for
acceptance and registration of assignment or transfer of all or part of a
Commitment and/or Loan, or as soon thereafter as practicable, the assigning
or transferor Lender shall surrender the Note evidencing such Commitment
and/or Loan, and thereupon one or more new Notes in the aggregate principal
amount so assigned shall be issued to the new Lender and, if applicable, a
new Note shall be issued to the assigning or transferor Lender in the
remaining aggregate principal amount of its Commitment and/or Loan not so
assigned. The Borrower agrees to
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indemnify the Agent from and against any and all losses, claims, damages
and liabilities of whatsoever nature which may be imposed on, asserted
against or incurred by the Agent in performing its duties under this
SECTION 10.08(c); but excluding any such losses, claims, damages and
liabilities incurred by reason of the gross negligence or willful
misconduct of the Agent. Each Lender agrees to indemnify the Borrower and
the Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against
or incurred by the Borrower or the Agent by reason of the inaccuracy of any
information which is furnished by such Lender concerning such Lender or its
Lending Office or the amount assigned pursuant to an Assignment and
Acceptance Agreement.
(d) Subject to the provisions of SECTION 10.09, the Borrower and
each Guarantor authorizes each Lender to disclose to any Participant,
Assignee or other transferee (each a "Transferee") and any prospective
Transferee any and all financial information in such Lender's possession
concerning the Borrower or such Guarantor which has been delivered to such
Lender by the Borrower or such Guarantor pursuant to this Agreement or
which has been delivered to such Lender by the Borrower or such Guarantor
in connection with such Lender's credit evaluation prior to entering into
this Agreement.
(e) No Transferee shall be entitled to receive any greater
payment under SECTION 2.11 or 8.03 than the transferor Lender would have
been entitled to receive with respect to the rights transferred, unless
such transfer is made with the Borrower's prior written consent or by
reason of the provisions of SECTION 2.11, 8.02 or 8.03 requiring such
Lender to designate a different Lending Office under certain circumstances
or at a time when the circumstances giving rise to such greater payment did
not exist.
(f) Anything in this SECTION 10.08 to the contrary
notwithstanding, any Lender may assign and pledge all or any portion of the
Loans and/or obligations owing to it to any Federal Reserve Bank or the
United States Treasury as collateral security pursuant to Regulation A of
the Board of Governors of the Federal Reserve System and any Operating
Circular issued by such Federal Reserve Bank, provided that any payment in
respect of such assigned Loans and/or obligations made by the Borrower to
the assigning and/or pledging Lender in accordance with the terms of this
Agreement shall satisfy the Borrower's obligations hereunder in respect of
such assigned Loans and/or obligations to the extent of such payment. No
such assignment shall release the assigning and/or pledging Lender from its
obligations hereunder.
SECTION 10.09. Confidentiality. The Agent and each Lender
acknowledges and agrees that the Borrower regards all information provided
by it or on its behalf to the Agent or any Lender pursuant hereto or in
connection herewith, other than information that is or becomes publicly
available without breach of a confidentiality obligation (collectively,
"Information"), as proprietary, highly confidential and sensitive.
Accordingly, the Agent and each Lender agree to use Information only for
purposes of this Agreement and the transactions contemplated hereby and
keep confidential all Information from anyone other than persons employed
by the Agent or such Lender on a strict "need to know" basis and so long as
such parties are notified of the confidential nature of such Information;
provided that nothing herein shall prevent any the Agent or any Lender from
disclosing such information (a) to any other Lender, (b) upon the order of
any court or administrative agency having jurisdiction over the Agent or
such Lender, (c) upon
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the request or demand of any regulatory agency or authority having
jurisdiction over the Agent or such Lender, (d) which has been publicly
disclosed other than as a result of breach of this Agreement, (e) to the
extent reasonably required in connection with any litigation relating to
this Agreement to which the Agent, any Lender or their respective
Affiliates may be a party, (f) to the extent reasonably required in
connection with the exercise of any remedy hereunder, (g) to such Lender's
legal counsel and independent auditors and (h) to any actual or proposed
Participant, Assignee or other Transferee of all or part of its rights
hereunder which has agreed in writing to be bound by the provisions of this
SECTION 10.09; provided that should disclosure of any such confidential
information be required by virtue of clause (b) or (c) of the immediately
preceding sentence, to the extent permitted by law, any relevant Lender
shall promptly notify the Borrower or the relevant Guarantor of same so as
to allow the Borrower or the relevant Guarantor to seek a protective order
or to take any other appropriate action; provided, further, that, no Lender
shall be required to delay compliance with any directive to disclose any
such information so as to allow the Borrower or the relevant Guarantor to
effect any such action.
SECTION 10.10. Representation by Lenders. Each Lender hereby
represents that it is a commercial Lender or financial institution which
makes loans in the ordinary course of its business and that it will make
its Loans hereunder for its own account in the ordinary course of such
business; provided that, subject to SECTION 10.08, the disposition of the
Note or Notes held by that Lender shall at all times be within its
exclusive control.
SECTION 10.11. Obligations Several. The obligations of each
Lender hereunder are several, and no Lender shall be responsible for the
obligations or commitment of any other Lender hereunder. Nothing contained
in this Agreement and no action taken by the Lenders pursuant hereto shall
be deemed to constitute the Lenders to be a partnership, an association, a
joint venture or any other kind of entity. The amounts payable at any time
hereunder to each Lender shall be a separate and independent debt, and each
Lender shall be entitled to protect and enforce its rights arising out of
this Agreement or any other Credit Document and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding
for such purpose.
SECTION 10.12. New York Law. This Agreement and each Note shall
be construed in accordance with and governed by the law of the State of New
York (without giving effect to the conflict of laws principles thereof,
other than Section 5-1401 of the New York General Obligations Law).
SECTION 10.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other
Credit Documents should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby and shall be enforced to the greatest extent permitted by
law.
SECTION 10.14. Interest. In no event shall the amount of
interest, and all charges, amounts or fees contracted for, charged or
collected pursuant to this Agreement, the Notes or the other Credit
Documents and deemed to be interest under applicable law (collectively,
"Interest") exceed the highest rate of interest allowed by applicable law
(the "Maximum Rate"), and in the event any such payment is inadvertently
received by any Lender,
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then the excess sum (the "Excess") shall be credited as a payment of
principal, unless the Borrower shall notify such Lender in writing that it
elects to have the Excess returned forthwith. It is the express intent
hereof that the Borrower not pay and the Lenders not receive, directly or
indirectly in any manner whatsoever, interest in excess of that which may
legally be paid by the Borrower under applicable law. The right to
accelerate maturity of any of the Loans does not include the right to
accelerate any interest that has not otherwise accrued on the date of such
acceleration, and the Agent and the Lenders do not intend to collect any
unearned interest in the event of any such acceleration. All monies paid to
the Agent or the Lenders hereunder or under any of the Notes or the other
Credit Documents, whether at maturity or by prepayment, shall be subject to
rebate of unearned interest as and to the extent required by applicable
law. By the execution of this Agreement, the Borrower covenants, to the
fullest extent permitted by law, that (i) the credit or return of any
Excess shall constitute the acceptance by the Borrower of such Excess, and
(ii) the Borrower shall not seek or pursue any other remedy, legal or
equitable, against the Agent or any Lender, based in whole or in part upon
contracting for charging or receiving any Interest in excess of the Maximum
Rate. For the purpose of determining whether or not any Excess has been
contracted for, charged or received by the Agent or any Lender, all
interest at any time contracted for, charged or received from the Borrower
in connection with this Agreement, the Notes or any of the other Credit
Documents shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread in equal parts throughout the full term of
the Commitments. The Borrower, the Agent and each Lender shall, to the
maximum extent permitted under applicable law, (x) characterize any
non-principal payment as an expense, fee or premium rather than as Interest
and (y) exclude voluntary prepayments and the effects thereof. The
provisions of this SECTION shall be deemed to be incorporated into each
Note and each of the other Credit Documents (whether or not any provision
of this SECTION is referred to therein). All such Credit Documents and
communications relating to any Interest owed by the Borrower and all
figures set forth therein shall, for the sole purpose of computing the
extent of obligations hereunder and under the Notes and the other Credit
Documents be automatically recomputed by the Borrower, and by any court
considering the same, to give effect to the adjustments or credits required
by this SECTION.
SECTION 10.15. Interpretation. No provision of this Agreement or
any of the other Credit Documents shall be construed against or interpreted
to the disadvantage of any party hereto by any court or other governmental
or judicial authority by reason of such party having or being deemed to
have structured or dictated such provision.
SECTION 10.16. WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION. THE
BORROWER (A) AND EACH OF THE LENDERS AND THE AGENT IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY OF THE OTHER CREDIT
DOCUMENTS, OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, (B)
SUBMITS TO THE NONEXCLUSIVE PERSONAL JURISDICTION IN THE STATE OF NEW YORK,
THE COURTS THEREOF AND THE UNITED STATES DISTRICT COURTS SITTING THEREIN,
FOR THE ENFORCEMENT OF THIS AGREEMENT, THE NOTES AND THE OTHER CREDIT
DOCUMENTS, (C) WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAW OF ANY
JURISDICTION TO OBJECT ON ANY BASIS (INCLUDING, WITHOUT LIMITATION,
INCONVENIENCE OF FORUM) TO JURISDICTION OR VENUE WITHIN
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THE STATE OF NEW YORK FOR THE PURPOSE OF LITIGATION TO ENFORCE THIS
AGREEMENT, THE NOTES OR THE OTHER CREDIT DOCUMENTS, AND (D) AGREES THAT
SERVICE OF PROCESS MAY BE MADE UPON IT IN THE MANNER PRESCRIBED IN SECTION
10.01 FOR THE GIVING OF NOTICE TO THE BORROWER. NOTHING HEREIN CONTAINED,
HOWEVER, SHALL PREVENT THE AGENT FROM BRINGING ANY ACTION OR EXERCISING ANY
RIGHTS AGAINST ANY SECURITY AND AGAINST THE BORROWER PERSONALLY, AND
AGAINST ANY ASSETS OF THE BORROWER, WITHIN ANY OTHER STATE OR JURISDICTION.
SECTION 10.17. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument.
SECTION 10.18. Source of Funds -- ERISA. Each of the Lenders
hereby severally (and not jointly) represents to the Borrower that no part
of the funds to be used by such Lender to fund the Loans hereunder from
time to time constitutes (a) assets allocated to any separate account
maintained by such Lender in which any employee benefit plan (or its
related trust) has any interest nor (b) any other assets of any employee
benefit plan. As used in this SECTION, the terms "employee benefit plan"
and "separate account" shall have the respective meanings assigned to such
terms in SECTION 3 of ERISA.
SECTION 10.19. Credit Inquiries. The Borrower and each Guarantor
hereby authorize and permit the Agent and each Lender, at its discretion
and without any obligation to do so, to respond to credit inquiries from
third parties concerning the Borrower, any Guarantor or any of the other
Subsidiaries.
SECTION 10.20. Consequential Damages. NONE OF THE LENDERS NOR THE
AGENT SHALL BE RESPONSIBLE OR LIABLE TO THE BORROWER OR ANY GUARANTOR OR
ANY OTHER PERSON OR ENTITY FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL
DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF THIS AGREEMENT, THE OTHER
CREDIT DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 10.21. Entire Agreement. This Agreement, together with
the other Credit Documents, constitute the entire agreement among the
parties hereto with respect to the subject matter hereof, and supersede and
replace any agreement, written or oral, existing between or among the
parties hereto in respect of such subject matter.
SECTION 10.22. Continuing Agreement. This Agreement, together
with all other Credit Documents, shall continue in full force and effect,
notwithstanding the termination of any one, or more or all of the
Commitments or the payment in full of one, or more of all of the
Obligations, unless and until all Commitments have been terminated, all
Letters of Credit have expired or terminated and all Obligations due and
owing on the date of termination (other than any Obligations of the type
described in clauses (c) and (d) of the definition of such term) have been
fully paid and satisfied, each in accordance with the terms and conditions
hereof and of the other Credit Documents; provided, however, that so long
as Obligations of the type described in clauses (c) and (d) of the
definition of such term are outstanding, such Obligations shall continue
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to be secured by the Collateral, the Agent shall continue to serve as
collateral agent with respect thereto and the covenants in this Agreement
and the Credit Documents pertaining to insuring, maintaining and preserving
the Collateral, and Events of Default pertaining thereto, shall continue in
force and effect, unless and only to the extent waived by Wachovia or any
other Lender or any Affiliate of either to whom any such Obligations are
owed or that is the other contracting party in any agreement giving rise to
such Obligations.
[Signatures are contained on the following pages.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, under seal, by their respective authorized officers as
of the day and year first above written.
BORROWER:
COMMSCOPE, INC. OF NORTH CAROLINA
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (SEAL)
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Executive Vice President and
Chief Financial Officer
Telecopier No. ▇▇▇-▇▇▇-▇▇▇▇
Confirmation No. ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇
Senior Vice President, General
Counsel and Secretary
CommScope Inc. of North Carolina
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: 828-431-2520
Confirmation: ▇▇▇-▇▇▇-▇▇▇▇
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COMMITMENT WACHOVIA BANK, NATIONAL
---------- ASSOCIATION,
as Agent and as a Lender (SEAL)
Revolving Loan
Commitment: $35,000,000
By: /s/
---------------------------------
Title
Lending Office
Wachovia Bank, National Association
Mail Code: NC0479
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier number: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation number: ▇▇▇-▇▇▇-▇▇▇▇
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PNC BANK, NATIONAL ASSOCIATION,
as a Lender (SEAL)
Revolving Loan
Commitment: $25,000,000
By: /s/
---------------------------------
Title
Lending Office
PNC Bank, National Association
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telecopier number: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation number: ▇▇▇-▇▇▇-▇▇▇▇
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BNP PARIBAS,
as a Lender (SEAL)
Revolving Loan
Commitment: $20,000,000
By: /s/
---------------------------------
Title
By: /s/
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Title
Lending Office
BNP Paribas
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▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopier number: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation number: ▇▇▇-▇▇▇-▇▇▇▇
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BRANCH BANKING AND TRUST COMPANY,
as a Lender (SEAL)
Revolving Loan
Commitment: $10,000,000
By: /s/
---------------------------------
Title
Lending Office
Branch Banking and Trust Company
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CONFIDENTIAL
CIBC, INC.,
as a Lender (SEAL)
Revolving Loan
Commitment: $10,000,000
By: /s/
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Title
Lending Office
CIBC, Inc.
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