EXHIBIT 10.1
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EXECUTION COPY
$180,000,000
CREDIT AGREEMENT
among
GENCORP INC.,
as Borrower,
ITS MATERIAL DOMESTIC SUBSIDIARIES
FROM TIME TO TIME PARTIES HERETO,
as Guarantors,
THE LENDERS PARTIES HERETO,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent,
THE BANK OF NOVA SCOTIA,
as Syndication Agent,
and
JPMORGAN CHASE BANK
and
THE BANK OF NEW YORK,
as Documentation Agents
Dated as of December 6, 2004
WACHOVIA CAPITAL MARKETS, LLC
as Co-Lead Arranger and Sole Book Runner
and
THE BANK OF NOVA SCOTIA
as Co-Lead Arranger
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS................................................................ 1
Section 1.1 Defined Terms...................................................... 1
Section 1.2 Other Definitional Provisions...................................... 36
Section 1.3 Accounting Terms................................................... 36
Section 1.4 Time References.................................................... 37
ARTICLE II THE LOANS; AMOUNT AND TERMS............................................... 37
Section 2.1 Revolving Loans.................................................... 37
Section 2.2 Revolving Letter of Credit Subfacility............................. 39
Section 2.3 Swingline Loan Subfacility......................................... 43
Section 2.4 Credit-Linked Facility--Term Loan Subfacility...................... 45
Section 2.5 Credit-Linked Facility - Letter of Credit Subfacility.............. 47
Section 2.6 Credit-Linked Deposits............................................. 52
Section 2.7 Fees............................................................... 53
Section 2.8 Commitment Reductions.............................................. 54
Section 2.9 Prepayments........................................................ 55
Section 2.10 Default Rate and Payment Dates..................................... 58
Section 2.11 Conversion Options................................................. 59
Section 2.12 Computation of Interest and Fees................................... 60
Section 2.13 Pro Rata Treatment and Payments.................................... 61
Section 2.14 Non-Receipt of Funds by the Administrative Agent................... 63
Section 2.15 Inability to Determine Interest Rate............................... 64
Section 2.16 Illegality......................................................... 64
Section 2.17 Requirements of Law................................................ 65
Section 2.18 Indemnity.......................................................... 66
Section 2.19 Taxes.............................................................. 67
Section 2.20 Indemnification; Nature of Issuing Lender's Duties................. 69
Section 2.21 Replacement of Lenders............................................. 70
ARTICLE III REPRESENTATIONS AND WARRANTIES........................................... 71
Section 3.1 Financial Condition................................................ 71
Section 3.2 No Change.......................................................... 72
Section 3.3 Corporate Existence................................................ 72
Section 3.4 Corporate Power; Authorization; Enforceable Obligations............ 72
Section 3.5 Compliance with Laws; No Conflict; No Default...................... 72
Section 3.6 No Material Litigation............................................. 73
Section 3.7 Investment Company Act; PUHCA...................................... 73
Section 3.8 Margin Regulations................................................. 74
Section 3.9 ERISA.............................................................. 74
Section 3.10 Environmental Matters.............................................. 74
Section 3.11 Use of Proceeds.................................................... 75
Section 3.12 Subsidiaries....................................................... 75
Section 3.13 Ownership.......................................................... 76
Section 3.14 Indebtedness....................................................... 76
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Section 3.15 Taxes.............................................................. 76
Section 3.16 Intellectual Property Rights....................................... 76
Section 3.17 Solvency........................................................... 77
Section 3.18 Investments........................................................ 77
Section 3.19 Location of Collateral............................................. 77
Section 3.20 No Burdensome Restrictions......................................... 78
Section 3.21 Brokers' Fees...................................................... 78
Section 3.22 Labor Matters...................................................... 78
Section 3.23 Accuracy and Completeness of Information........................... 78
Section 3.24 Material Contracts................................................. 78
Section 3.25 Insurance.......................................................... 79
Section 3.26 Security Documents................................................. 79
Section 3.27 Regulation H....................................................... 79
Section 3.28 Classification of Senior Indebtedness.............................. 79
Section 3.29 Compliance with Trading with the Enemy Act, OFAC Rules and
Regulations and Patriot Act........................................ 79
ARTICLE IV CONDITIONS PRECEDENT...................................................... 80
Section 4.1 Conditions to Closing Date......................................... 80
Section 4.2 Conditions to All Extensions of Credit............................. 85
ARTICLE V AFFIRMATIVE COVENANTS...................................................... 86
Section 5.1 Financial Statements............................................... 87
Section 5.2 Certificates; Other Information.................................... 88
Section 5.3 Payment of Taxes; Other Obligations; Performance of Certain
Other Agreements................................................... 89
Section 5.4 Conduct of Business and Maintenance of Existence................... 90
Section 5.5 Maintenance of Property; Insurance................................. 90
Section 5.6 Inspection of Property; Books and Records; Discussions............. 91
Section 5.7 Notices............................................................ 91
Section 5.8 Environmental Laws................................................. 92
Section 5.9 Financial Covenants................................................ 93
Section 5.10 Additional Guarantors.............................................. 94
Section 5.11 Compliance with Law................................................ 95
Section 5.12 Pledged Assets..................................................... 95
Section 5.13 Covenants Regarding Patents, Trademarks and Copyrights............. 96
Section 5.14 Further Assurances; Post-Closing Covenants......................... 97
ARTICLE VI NEGATIVE COVENANTS........................................................ 98
Section 6.1 Indebtedness....................................................... 98
Section 6.2 Liens.............................................................. 100
Section 6.3 Nature of Business................................................. 101
Section 6.4 Consolidation, Merger, Sale or Purchase of Assets, etc............. 101
Section 6.5 Advances, Investments and Loans.................................... 103
Section 6.6 Transactions with Affiliates....................................... 103
Section 6.7 Ownership of Subsidiaries; Restrictions............................ 103
Section 6.8 Fiscal Year; Organizational Documents; Material Contracts;
Accounting Policies................................................ 103
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Section 6.9 Limitation on Restricted Actions................................... 104
Section 6.10 Restricted Payments................................................ 104
Section 6.11 Amendment of Subordinated Debt..................................... 105
Section 6.12 Sale Leasebacks.................................................... 105
Section 6.13 No Further Negative Pledges........................................ 105
Section 6.14 Accounts........................................................... 106
ARTICLE VII EVENTS OF DEFAULT........................................................ 106
Section 7.1 Events of Default.................................................. 106
Section 7.2 Acceleration; Remedies............................................. 109
ARTICLE VIII THE ADMINISTRATIVE AGENT................................................ 110
Section 8.1 Appointment........................................................ 110
Section 8.2 Delegation of Duties............................................... 110
Section 8.3 Exculpatory Provisions............................................. 111
Section 8.4 Reliance by Administrative Agent................................... 111
Section 8.5 Notice of Default.................................................. 112
Section 8.6 Non-Reliance on Administrative Agent and Other Lenders............. 112
Section 8.7 Indemnification.................................................... 113
Section 8.8 The Administrative Agent in Its Individual Capacity................ 113
Section 8.9 Successor Administrative Agent..................................... 113
Section 8.10 Other Agents....................................................... 114
Section 8.11 Release of Collateral and AFC...................................... 114
ARTICLE IX MISCELLANEOUS............................................................. 115
Section 9.1 Amendments, Waivers and Release of Collateral...................... 115
Section 9.2 Notices............................................................ 118
Section 9.3 No Waiver; Cumulative Remedies..................................... 119
Section 9.4 Survival of Representations and Warranties......................... 119
Section 9.5 Payment of Expenses and Taxes...................................... 119
Section 9.6 Successors and Assigns; Participations; Purchasing Lenders......... 120
Section 9.7 Adjustments; Set-off............................................... 123
Section 9.8 Table of Contents and Section Headings............................. 124
Section 9.9 Counterparts....................................................... 124
Section 9.10 Integration; Effectiveness; Continuing Agreement................... 125
Section 9.11 Severability....................................................... 125
Section 9.12 Governing Law...................................................... 126
Section 9.13 Consent to Jurisdiction and Service of Process..................... 126
Section 9.14 Confidentiality.................................................... 126
Section 9.15 Acknowledgments.................................................... 127
Section 9.16 Waivers of Jury Trial; Waiver of Consequential Damages............. 127
Section 9.17 Patriot Act Notice................................................. 128
ARTICLE X GUARANTY................................................................... 128
Section 10.1 The Guaranty....................................................... 128
Section 10.2 Bankruptcy......................................................... 129
Section 10.3 Nature of Liability................................................ 129
Section 10.4 Independent Obligation............................................. 129
Section 10.5 Authorization...................................................... 130
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Section 10.6 Reliance........................................................... 130
Section 10.7 Waiver............................................................. 130
Section 10.8 Limitation on Enforcement.......................................... 131
Section 10.9 Confirmation of Payment............................................ 132
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SCHEDULES
Schedule 1.1(a) Account Designation Letter
Schedule 1.1(b) Investments
Schedule 1.1(c) Liens
Schedule 1.1(d) Consolidated Capital Expenditures/Consolidated Interest
Expense
Schedule 1.1(e) Existing Letters of Credit
Schedule 2.1(a) Schedule of Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.2(d) Form of Term Loan Note
Schedule 2.3(d) Form of Swingline Note
Schedule 2.5(j) Form of Credit-Linked Note
Schedule 2.11 Form of Notice of Conversion/Extension
Schedule 2.19 Tax Exempt Certificate
Schedule 3.3 Jurisdictions of Organization and Qualification
Schedule 3.12 Subsidiaries
Schedule 3.16 Intellectual Property
Schedule 3.19(a) Location of Real Property
Schedule 3.19(b) Location of Collateral
Schedule 3.19(c) Chief Executive Offices
Schedule 3.22 Labor Matters
Schedule 3.24 Material Contracts
Schedule 3.25 Insurance
Schedule 4.1(b) Form of Secretary's Certificate
Schedule 4.1(h) Form of Solvency Certificate
Schedule 5.2(b) Form of Officer's Compliance Certificate
Schedule 5.10 Form of Joinder Agreement
Schedule 6.1(b) Indebtedness
Schedule 9.2 Lenders' Lending Offices
Schedule 9.6(c) Form of Commitment Transfer Supplement
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CREDIT AGREEMENT, dated as of December 6, 2004, among GENCORP INC., an
Ohio corporation (the "Borrower"), each of those Material Domestic Subsidiaries
of the Borrower identified as a "Guarantor" on the signature pages hereto and
such other Material Domestic Subsidiaries of the Borrower as may from time to
time become a party hereto (collectively the "Guarantors" and individually a
"Guarantor"), the several banks and other financial institutions from time to
time parties to this Credit Agreement (collectively the "Lenders" and
individually a "Lender"), and WACHOVIA BANK, NATIONAL ASSOCIATION, a national
banking association, as administrative agent for the Lenders hereunder (in such
capacity, the "Administrative Agent" or the "Agent").
W I T N E S S E T H:
WHEREAS, the Borrower has requested that the Lenders make loans and other
financial accommodations to the Borrower in the amount of up to $180,000,000, as
more particularly described herein; and
WHEREAS, the Lenders have agreed to make such loans and other financial
accommodations to the Borrower on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINED TERMS.
As used in this Credit Agreement, terms defined in the preamble to this
Credit Agreement have the meanings therein indicated, and the following terms
have the following meanings:
"2007 Convertible Notes" shall mean, collectively, those certain 5.75%
unsecured convertible subordinated notes due April 2007 issued by the Borrower,
as the same may be amended, restated, supplemented or otherwise modified from
time to time as permitted hereunder.
"2013 Senior Subordinated Notes" shall mean, collectively, those certain
9.50% unsecured senior subordinated notes due 2013 issued by the Borrower, as
the same may be amended, restated, supplemented or otherwise modified from time
to time as permitted hereunder.
"2024 Convertible Notes" shall mean, collectively, those certain 4.00%
unsecured convertible subordinated notes due January 2024 issued by the
Borrower, as the same may be
amended, restated, supplemented or otherwise modified from time to time as
permitted hereunder.
"ABR Default Rate" shall mean, as of any date of determination, the
Alternate Base Rate plus the Applicable Percentage with respect to Alternate
Base Rate Loans on such date plus 2%.
"Accelerated Maturity Date" shall mean (a) the date that is three (3)
months prior to the maturity date of the 2007 Convertible Notes, unless on or
before the date that is three (3) months prior to such maturity date, (i) the
2007 Convertible Notes have been redeemed (with funds other than Loan proceeds)
or refinanced in full on substantially similar or more favorable terms (and the
maturity thereof extended to a date that is at least six (6) months after the
Credit-Linked Maturity Date) and otherwise on terms reasonably satisfactory to
the Administrative Agent or (ii) the Borrower shall have deposited in a cash
collateral account maintained by the Administrative Agent or a Lender the amount
necessary to redeem (with funds other than Loan proceeds) the full amount of the
2007 Convertible Notes then outstanding, or (b) to the extent clause (a) does
not apply because the conditions in subclauses (i) or (ii) thereof have been
satisfied, the date that is three (3) months prior to the date that the holders
of the 2024 Convertible Notes have the option to require the Borrower to redeem
such 2024 Convertible Notes in accordance with the terms of such 2024
Convertible Notes and the documentation related thereto, unless on or before the
date that is three (3) months prior to such redemption date, (i) the 2024
Convertible Notes have been redeemed (with funds other than Loan proceeds) or
refinanced in full on substantially similar or more favorable terms (and the
maturity thereof extended to a date that is at least six (6) months after the
Credit-Linked Maturity Date) and otherwise on terms reasonably satisfactory to
the Administrative Agent or (ii) the Borrower shall have deposited in a cash
collateral account maintained by the Administrative Agent or a Lender the amount
necessary to redeem (with funds other than Loan proceeds) the full amount of the
2024 Convertible Notes then outstanding.
"Account Designation Letter" shall mean the Notice of Account Designation
Letter dated the Closing Date from the Borrower to the Administrative Agent in
substantially the form attached hereto as Schedule 1.1(a).
"Additional Credit Party" shall mean each Person that becomes a Guarantor
by execution of a Joinder Agreement in accordance with Section 5.10.
"Administrative Agent" or "Agent" shall have the meaning set forth in the
first paragraph of this Credit Agreement and any successors in such capacity.
"Aerojet" means Aerojet - General Corporation, an Ohio corporation.
"AFC Sale" shall mean the sale or other disposition of all or
substantially all of the assets or voting stock of Aerojet Fine Chemicals LLC.
"Affiliate" shall mean as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, a Person shall be deemed to
be "controlled by" a Person if such Person possesses,
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directly or indirectly, power either (a) to vote 10% or more of the securities
having ordinary voting power for the election of directors of such Person or (b)
to direct or cause the direction of the management and policies of such Person
whether by contract or otherwise.
"Agreement" or "Credit Agreement" shall mean this Credit Agreement, as
amended, restated, amended and restated, modified, supplemented, extended,
replaced or increased from time to time in accordance with its terms.
"Alternate Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Rate" shall mean, at any time, the rate of interest per annum publicly
announced or otherwise identified from time to time by Wachovia at its principal
office in Charlotte, North Carolina as its prime rate. The parties hereto
acknowledge that the rate announced publicly by Wachovia as its Prime Rate is an
index or base rate and shall not necessarily be its lowest or best rate charged
to its customers or other banks; and "Federal Funds Effective Rate" shall mean,
for any day, the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published on the next
succeeding Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive in the absence of manifest error) that it is unable to ascertain the
Federal Funds Effective Rate, for any reason, including the inability or failure
of the Administrative Agent to obtain sufficient quotations in accordance with
the terms thereof, the Alternate Base Rate shall be determined without regard to
clause (b) of the first sentence of this definition, as appropriate, until the
circumstances giving rise to such inability no longer exist. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the opening of business on the date of such
change.
"Alternate Base Rate Loans" shall mean Loans that bear interest at an
interest rate based on the Alternate Base Rate.
"Applicable Percentage" shall mean, for any day, the rate per annum set
forth below opposite the applicable Level then in effect, it being understood
that the Applicable Percentage for (a) Revolving Loans and Term Loans that are
Alternate Base Rate Loans shall be the percentage set forth under the column
titled "Base Rate Margin" as applicable, (b) Revolving Loans and Term Loans that
are LIBOR Rate Loans shall be the percentage set forth under the column titled
"LIBOR Margin" as applicable and (c) the Revolving LOC Commitment Fee shall be
the percentage set forth under the column titled "LIBOR Margin" and "Revolving
Loans and Revolving LOC Commitment Fee":
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LIBOR Margin
------------------------------
Unadjusted Revolving Loans Base Rate Margin
Senior and Revolving LOC ---------------------------------
Level Leverage Ratio Commitment Fee Term Loans Revolving Loans Term Loans
----- ----------------- ----------------- ---------- --------------- --------------
I > or = 2.25 to 1.0 3.00% 3.00% 2.00% 2.00%
II < 2.25 to 1.0 but 2.75% 3.00% 1.75% 2.00%
> or = 1.75 to 1.0
III < 1.75 to 1.0 but 2.50% 3.00% 1.50% 2.00%
> or = 1.25 to 1.0
V < 1.25 to 1.0 2.25% 3.00% 1.25% 2.00%
The Applicable Percentage shall, in each case, be determined and adjusted
quarterly on the date five (5) Business Days after the date on which the
Administrative Agent has received from the Credit Parties the quarterly
financial information (in the case of the first three fiscal quarters of the
Borrower), the annual financial information (in the case of the fourth fiscal
quarter of the Borrower) and the certifications required to be delivered to the
Administrative Agent and the Lenders in accordance with the provisions of
Sections 5.1(a), 5.1(b) and 5.2(b) (each an "Interest Determination Date"). Such
Applicable Percentage shall be effective from such Interest Determination Date
until the next such Interest Determination Date. After the Closing Date, if the
Credit Parties shall fail to provide any of the financial information or
certifications in accordance with the provisions of Sections 5.1(a), 5.1(b) and
5.2(b), in addition to the default rate of interest that may be charged pursuant
to Section 2.10(b), the Applicable Percentage shall, on the date five (5)
Business Days after the date by which the Credit Parties were so required to
provide such financial information or certifications to the Administrative Agent
and the Lenders, be based on Level I until such time as such information or
certifications are provided, whereupon the Level shall be determined by the then
current Leverage Ratio. Notwithstanding the foregoing, the Applicable Percentage
shall be at Level II above for the first two fiscal quarters ending after the
Closing Date.
"Approved Fund" shall mean, with respect to any Lender or other Person who
invests in commercial bank loans in the ordinary course of business, any other
fund or trust or entity that invests in commercial bank loans in the ordinary
course of business and is advised or managed by such Lender, by an Affiliate of
such Lender or other Persons or the same investment advisor as such Lender or by
an Affiliate of such Lender or investment advisor.
"Arranger" shall mean Wachovia Capital Markets, LLC, together with its
successors and assigns.
"Asset Disposition" shall mean the disposition of any or all of the assets
(including, without limitation, the Capital Stock of a Subsidiary or any
ownership interest in a Joint Venture) of the Borrower or any Subsidiary,
whether by sale, lease, transfer or otherwise. The term "Asset Disposition"
shall not include (i) the sale, lease or transfer of assets permitted by
subsections 6.4(a)(i) through (viii) and 6.4(a)(xi), or (ii) any Equity
Issuance.
4
"Bankruptcy Code" shall mean the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Bankruptcy Event" shall mean any of the events described in Section
7.1(f), after giving effect to any cure period described therein.
"Borrower" shall have the meaning set forth in the first paragraph of this
Credit Agreement.
"Borrowing Date" shall mean, in respect of any Loan, the date such Loan is
made.
"Business" shall have the meaning set forth in Section 3.10.
"Business Day" shall mean a day other than a Saturday, Sunday or other day
on which commercial banks in Charlotte, North Carolina or New York, New York are
authorized or required by law to close; provided, however, that when used in
connection with a rate determination, borrowing or payment in respect of a LIBOR
Rate Loan, the term "Business Day" shall also exclude any day on which banks in
London, England are not open for dealings in Dollar deposits in the London
interbank market.
"Capital Lease" shall mean any lease of property, real or personal, the
obligations with respect to which are required to be capitalized on a balance
sheet of the lessee in accordance with GAAP.
"Capital Lease Obligations" shall mean the capitalized lease obligations
relating to a Capital Lease determined in accordance with GAAP.
"Capital Stock" shall mean (a) in the case of a corporation, capital
stock, (b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (c) in the case of a partnership, partnership interests (whether
general or limited), (d) in the case of a limited liability company, membership
interests and (e) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" shall mean (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve (12) months from the date of acquisition ("Government Obligations"),
(b) Dollar denominated (or foreign currency fully hedged to the Dollar) time
deposits, certificates of deposit, Eurodollar time deposits and Eurodollar
certificates of deposit of (i) any domestic commercial bank of recognized
standing having capital and surplus in excess of $250,000,000 or (ii) any bank
whose short-term commercial paper rating from S&P is at least A-1 or the
equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent thereof
(any such bank being an "Approved Bank"), in each case with maturities of not
more than 364 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any
5
Approved Bank (or by the parent company thereof) or any variable rate notes
issued by, or guaranteed by any domestic corporation rated A-1 (or the
equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by ▇▇▇▇▇'▇ and maturing within six (6) months of the date of acquisition,
(d) repurchase agreements with a bank or trust company (including a Lender) or a
recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America, (e) obligations of any State of the United States or any
political subdivision thereof for the payment of the principal and redemption
price of and interest on which there shall have been irrevocably deposited
Government Obligations maturing as to principal and interest at times and in
amounts sufficient to provide such payment, and (f) auction preferred stock
rated in the highest short-term credit rating category by S&P or ▇▇▇▇▇'▇.
"Change of Control" shall mean at any time the occurrence of one or more
of the following events: (a) any "person" or "group" (as such terms are used in
Section 13(d) and 14(d) of the Exchange Act), is or becomes the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that
a person shall be deemed to have "beneficial ownership" of all securities that
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of 30%
or more of the then outstanding Voting Securities of the Borrower; or (b) the
replacement of a majority of the Board of Directors of the Borrower over a
two-year period from the directors who constituted the Board of Directors at the
beginning of such period, and such replacement shall not have been approved by a
vote of at least a majority of the Board of Directors of the Borrower then still
in office who either were members of such Board of Directors at the beginning of
such period or whose election as a member of such Board of Directors was
previously so approved.
"Claw-Back" shall have the meaning set forth in Section 4.1(s).
"Closing Date" shall mean the date of this Credit Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" shall mean a collective reference to the collateral which is
identified in, and at any time will be covered by, the Security Documents and
any other collateral that may from time to time secure the Credit Party
Obligations.
"Commitment" shall mean the Revolving Commitment, the Revolving LOC
Commitment, the Swingline Commitment and the Credit-Linked Commitment,
individually or collectively, as appropriate.
"Commitment Percentage" shall mean the Revolving Commitment Percentage
and/or the Credit-Linked Commitment Percentage, as appropriate.
"Commitment Transfer Supplement" shall mean a Commitment Transfer
Supplement, in substantially the form of Schedule 9.6(c).
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"Commonly Controlled Entity" shall mean an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Consolidated" shall mean, when used with reference to financial
statements or financial statement items of the Borrower and its Subsidiaries or
any other Person, such statements or items on a consolidated basis in accordance
with the consolidation principles of GAAP.
"Consolidated Capital Expenditures" shall mean, as of any date of
determination for the four quarter period ending on such date, all expenditures
of the Borrower and its Subsidiaries on a Consolidated basis for such period
that in accordance with GAAP would be classified as capital expenditures,
excluding capital expenditures constituting Capital Lease Obligations, less the
amount of proceeds from asset dispositions (other than dispositions of real
property) that are reinvested in the business; provided that, for purposes of
determining the Fixed Charge Coverage Ratio, Consolidated Capital Expenditures
for the fiscal quarters ending February 28, 2004, May 31, 2004 and August 31,
2004 shall be the amounts set forth on Schedule 1.1(d); provided further that
Consolidated Capital Expenditures shall not include (a) capital expenditures
assumed in connection with Permitted Acquisitions and (b) capital expenditures
in respect of reinvestment of proceeds derived from Recovery Events.
"Consolidated Cash Taxes" shall mean, as of any date of determination for
the four quarter period ending on such date, the sum of (a) the aggregate of all
taxes (including, without limitation, any federal, state, local and foreign
income (or equivalent) taxes) actually paid by the Borrower and its Subsidiaries
on a Consolidated basis during such period minus (b) the aggregate of all cash
tax refunds received by the Borrower and its Subsidiaries on a Consolidated
basis during such period.
"Consolidated EBITDAP" shall mean, as of any date of determination for the
four quarter period ending on such date, (a) Consolidated Net Income for such
period plus (b) the sum of the following (without duplication) to the extent
deducted in calculating Consolidated Net Income: (i) Consolidated Interest
Expense for such period, (ii) tax expense (including, without limitation, any
federal, state, local and foreign income (or equivalent) taxes) of the Borrower
and its Subsidiaries for such period, (iii) depreciation and amortization for
such period, (iv) any non-cash loss or expense associated with any unfunded
post-retirement health or insurance benefit plans of the Borrower, but only to
the extent Section 420 of the Internal Revenue Code (or its successor provision)
was utilized by the Borrower in the preceding fiscal year of the Borrower, (v)
non-cash pension plan expenses for such period, (vi) non-recurring fees and
expenses paid in connection with the Transactions as well as any write-off of
any unamortized fees and expenses associated with prior financings now affected
by the Transactions for such period, (vii) charges associated with legal
judgments rendering the Borrower contributorily liable under CERCLA in the case
of GenCorp Inc. vs. ▇▇▇▇ Corporation in an amount not to exceed $30,000,000 and
(viii) non-cash charges related to discontinued operations for such period minus
the following (without duplication): (A) cash charges to the extent such cash
charges were added back to Consolidated Net Income in calculating Consolidated
EBITDAP for a prior period after the Closing Date, except for cash charges
related to the GDX manufacturing facility in Chartres,
7
France for such period in an amount not to exceed $6,000,000, (B) cash
contributions to pension plans during such period to the extent not already
included in the calculation of Consolidated Net Income and (C) non-cash pension
plan income for such period.
Further, (1) for any four-quarter period, Consolidated EBITDAP shall be
calculated on a pro forma basis to exclude the effects of the GDX business, (2)
for any four-quarter period ending on or after the closing date of the AFC Sale
(to the extent that such date occurs), Consolidated EBITDAP shall be calculated
on a pro forma basis to exclude the effects of AFC and (3) for any four-quarter
period ending on after the closing date of any Permitted Acquisition,
Consolidated EBITDAP shall be calculated on a pro forma basis assuming the
consummation of such Permitted Acquisition as of the first day of such period.
"Consolidated Fixed Charges" shall mean, as of any date of determination
for the four quarter period ending on such date, the sum of (a) Consolidated
Interest Expense net of interest income for such period plus (b) Consolidated
Scheduled Debt Payments for such period plus (c) Consolidated Cash Taxes for
such period, in each case for the Borrower and its Subsidiaries on a
Consolidated basis.
"Consolidated Funded Debt" shall mean, on any date of calculation, Funded
Debt of the Borrower and its Subsidiaries on a Consolidated basis.
"Consolidated Interest Expense" shall mean, as of any date of
determination for the four quarter period ending on such date, all interest
expense (excluding amortization of debt discount and premium, but including the
interest component under Capital Leases) for such period of the Borrower and its
Subsidiaries on a Consolidated basis. Notwithstanding the foregoing, for
purposes of calculating Consolidated Interest Expense for the fiscal quarters
ending February 28, 2005, May 31, 2005 and August 31, 2005, Consolidated
Interest Expense shall be annualized during such fiscal quarters such that (i)
for the calculation of Consolidated Interest Expense as of February 28, 2005,
Consolidated Interest Expense for the fiscal quarter then ending will be
multiplied by four (4), (ii) for the calculation of Consolidated Interest
Expense as of May 31, 2005, Consolidated Interest Expense for the two fiscal
quarter period then ending will be multiplied by two (2) and (iii) for the
calculation of Consolidated Interest Expense as of August 31, 2005, Consolidated
Interest Expense for the three fiscal quarter period then ending will be
multiplied by one and one-third (1 1/3).
"Consolidated Net Income" shall mean, as of any date of determination for
the four quarter period ending on such date, the net income or net loss
(excluding (a) extraordinary losses and gains, (b) gains or losses from any sale
of a division or line of business and (c) all Non-Cash Non-Operating income or
loss) of the Borrower and its Subsidiaries on a Consolidated basis for such
period; provided, however, with respect to any Subsidiary or Permitted Joint
Venture that is not consolidated with the Borrower for purposes of the
Borrower's financial statements, only cash dividends and distributions made by
such Subsidiary or Permitted Joint Venture to the Borrower or a Subsidiary shall
be included in the calculation of Consolidated Net Income. Except as otherwise
specified, the applicable period shall be for the four consecutive quarters
ending as of the date of computation.
8
"Consolidated Scheduled Debt Payments" shall mean, as of any date of
determination for the four quarter period ending on such date, the sum of all
scheduled payments of principal on Consolidated Funded Debt for such period
(including the principal component of payments due on Capital Leases during the
applicable period ending on such date); it being understood that scheduled
payments of principal on Consolidated Funded Debt shall not include optional
prepayments or the mandatory prepayments required pursuant to Section 2.9.
Notwithstanding the foregoing, for purposes of calculating Consolidated
Scheduled Debt Payments for the fiscal quarters ending February 28, 2005, May
31, 2005 and August 31, 2005, Consolidated Scheduled Debt Payments shall be
annualized during such fiscal quarters such that (i) for the calculation of
Consolidated Scheduled Debt Payments as of February 28, 2005, Consolidated
Scheduled Debt Payments for the fiscal quarter then ending will be multiplied by
four (4), (ii) for the calculation of Consolidated Scheduled Debt Payments as of
May 31, 2005, Consolidated Scheduled Debt Payments for the two fiscal quarter
period then ending will be multiplied by two (2) and (iii) for the calculation
of Consolidated Scheduled Debt Payments as of August 31, 2005, Consolidated
Scheduled Debt Payments for the three fiscal quarter period then ending will be
multiplied by one and one-third (1 1/3).
"Consolidated Total Assets" shall mean, with respect to any Person, the
book value, determined on a consolidated basis in accordance with GAAP, of all
assets of such Person and its Subsidiaries.
"Consolidated Working Capital" shall mean, as of any date of
determination, the excess of (a) current assets (excluding cash and Cash
Equivalents) of the Borrower and its Subsidiaries on a Consolidated basis at
such time less (b) current liabilities (excluding current maturities of long
term debt) of the Borrower and its Subsidiaries on a Consolidated basis at such
time, all as determined in accordance with GAAP.
"Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Copyright Act" shall have the meaning set forth in Section 3.16.
"Copyright Licenses" shall mean any agreement, whether written or oral,
providing for the grant by or to a Person of any right under any Copyright,
including, without limitation, any thereof referred to in Schedule 3.16 to this
Credit Agreement.
"Copyrights" shall mean all copyrights of the Credit Parties and their
Subsidiaries in all works, now existing or hereafter created or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Copyright 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, including, without limitation,
any thereof referred to in Schedule 3.16 and all renewals thereof.
"Credit Documents" shall mean this Credit Agreement, each of the Notes,
any Joinder Agreement, the Letters of Credit, the LOC Documents, the
Environmental Indemnity and the
9
Security Documents and all other agreements, documents, certificates and
instruments delivered to the Administrative Agent or any Lender by any Credit
Party in connection therewith (other than any agreement, document, certificate
or instrument related to a Hedging Agreement).
"Credit-Linked Account" shall mean the account established and maintained
by the Administrative Agent in its name and under its sole dominion and control,
designated as the "Wachovia Bank, National Association, as Administrative
Agent--GenCorp. Inc. Credit Linked Account" that shall be used solely for the
purposes set forth in Sections 2.6(b).
"Credit-Linked Commitment" shall mean, with respect to each Credit-Linked
Lender, the sum of such Credit-Linked Lender's Credit-Linked LOC Commitment and
Term Loan Commitment.
"Credit-Linked Commitment Percentage" shall mean, for each Credit-Linked
Lender, the percentage identified as its Credit-Linked Commitment Percentage on
Schedule 2.1(a) or in the Register, as such percentage may be modified in
connection with any assignment made in accordance with the provisions of Section
9.6(c).
"Credit-Linked Commitment Period" shall mean, with respect to
Credit-Linked Letters of Credit, the period from and including the Closing Date
to but excluding the date that is ten (10) days prior to the Credit-Linked
Maturity Date.
"Credit-Linked Deposit" shall mean, with respect to any Credit-Linked
Lender, such Credit-Linked Lender's funded Credit-Linked Participation in the
Credit-Linked LOC Committed Amount and all Credit-Linked Letters of Credit
issued thereunder, which funded Credit-Linked Participation shall be in an
amount equal to such Credit-Linked Lender's Credit-Linked LOC Commitment and
shall be deposited into the Credit-Linked Account on the Closing Date (or on the
date such Person becomes a Credit-Linked Lender) in accordance with the terms of
Section 2.6(a).
"Credit-Linked Issuing Lender" shall mean, with respect to any
Credit-Linked Letter of Credit, the Administrative Agent or such other Lender as
requested by the Borrower and approved by the Administrative Agent, or any other
Person that was the Administrative Agent or a Lender at the time it issued such
Credit-Linked Letter of Credit but has ceased to be the Administrative Agent or
a Lender under the Credit Agreement.
"Credit-Linked Lenders" shall mean, as of any date of determination, the
Lenders that hold a Credit-Linked Commitment on such date.
"Credit-Linked Letters of Credit" shall mean (a) any letter of credit
issued by the Credit-Linked Issuing Lender pursuant to Section 2.5(a) and (b)
any Existing Letter of Credit, in each case as such letter of credit may be
amended, modified, extended, renewed or replaced from time to time.
"Credit-Linked LOC Commitment" shall mean the commitment of the
Credit-Linked Issuing Lender to issue Credit-Linked Letters of Credit and with
respect to each Credit-Linked
10
Lender, the commitment of such Credit-Linked Lender to purchase its
Credit-Linked Participation in the Credit-Linked Letters of Credit up to such
Credit-Linked Lender's Credit-Linked Commitment Percentage of the Credit-Linked
LOC Committed Amount as specified in Schedule 2.1(a) or in the Register, as such
amount may be reduced from time to time in accordance with the provisions
hereof.
"Credit-Linked LOC Committed Amount" shall have the meaning set forth in
Section 2.5(a).
"Credit-Linked LOC Fronting Fee" shall have the meaning set forth in
Section 2.7(d).
"Credit-Linked LOC Obligations" shall mean, at any time, the sum of (i)
the maximum amount which is, or at any time thereafter may become, available to
be drawn under Credit-Linked Letters of Credit then outstanding, assuming
compliance with all requirements for drawings referred to in such Credit-Linked
Letters of Credit plus (ii) the aggregate amount of all drawings under
Credit-Linked Letters of Credit honored by the Credit-Linked Issuing Lender but
not theretofore reimbursed.
"Credit-Linked Maturity Date" shall mean the earlier of (a) the date that
is six (6) years after the Closing Date and (b) to the extent applicable, the
Accelerated Maturity Date.
"Credit-Linked Note" shall mean the promissory notes of the Borrower in
favor of each Credit-Linked Issuing Lender evidencing the Borrower's obligation
to reimburse such Credit-Linked Issuing Lender for draws under Credit-Linked
Letters of Credit provided by such Credit-Linked Issuing Lender pursuant to
Section 2.5, as such promissory note may be amended, modified, restated, amended
and restated, supplemented, extended, renewed or replaced from time to time.
"Credit-Linked Participation" shall have the meaning set forth in Section
2.5(c).
"Credit-Linked Purchase" shall have the meaning set forth in Section
2.5(d).
"Credit Party" shall mean any of the Borrower or the Guarantors.
"Credit Party Obligations" shall mean, without duplication, (a) all of the
obligations, indebtedness and liabilities of the Credit Parties to the Lenders
(including the Issuing Lenders) and the Administrative Agent, whenever arising,
under this Credit Agreement, the Notes or any of the other Credit Documents,
including principal, interest, fees, reimbursements and indemnification
obligations and other amounts (including, but not limited to, any interest
accruing after the occurrence of a filing of a petition of bankruptcy under the
Bankruptcy Code with respect to any Credit Party, regardless of whether such
interest is an allowed claim under the Bankruptcy Code) and (b) solely for
purposes of the Security Documents and the Guaranty, all liabilities and
obligations, whenever arising, owing from any Credit Party or any of their
Subsidiaries to any Hedging Agreement Provider arising under any Secured Hedging
Agreement.
11
"Customary Permitted Liens" shall mean:
(a) Liens for taxes not yet due and payable or which are being contested
in good faith by appropriate proceedings diligently pursued; provided that (i)
any proceedings commenced for the enforcement of such Liens shall have been
stayed or suspended within 30 days of the commencement thereof and (ii)
provision for the payment of all such taxes known to such Person has been made
on the books of such Person to the extent required by GAAP;
(b) mechanic's, processor's, materialman's, carrier's, warehousemen's,
landlord's and similar Liens (including statutory and common law landlord's
liens under leases to which any Credit Party or any Subsidiary is a party)
arising by operation of law and arising in the ordinary course of business and
securing obligations of such Person that are not overdue for a period of more
than ninety (90) days or are being contested in good faith by appropriate
proceedings diligently pursued; provided that (i) any proceedings commenced for
the enforcement of such Liens shall have been stayed or suspended within thirty
(30) days of the commencement thereof and (ii) provision for the payment of such
Liens has been made on the books of such Person to the extent required by GAAP;
(c) Liens arising in connection with worker's compensation, unemployment
insurance, old age pensions and social security benefits which are not overdue
or are being contested in good faith by appropriate proceedings diligently
pursued; provided that (i) any proceedings commenced for the enforcement of such
Liens shall have been stayed or suspended within 30 days of the commencement
thereof and (ii) provision for the payment of such Liens has been made on the
books of such Person to the extent required by GAAP;
(d) Liens (i) incurred or deposits made in the ordinary course of business
to secure the performance of bids, tenders, statutory obligations, fee and
expense arrangements with trustees and fiscal agents (exclusive of obligations
incurred in connection with the borrowing of money or the payment of the
deferred purchase price of property) and customary deposits granted in the
ordinary course of business under operating leases and (ii) securing surety,
indemnity, performance, appeal and release bonds; provided that (A) full
provision for the payment of all such obligations has been made on the books of
such Person to the extent required by GAAP and (B) the aggregate amount of all
such obligations does not exceed $1,000,000 at any time outstanding;
(e) Permitted Real Property Encumbrances;
(f) attachment, judgment or other similar Liens arising in connection with
court or arbitration proceedings involving individually and in the aggregate
liability of $1,000,000 or less at any one time; provided the same are
discharged, or that execution or enforcement thereof is stayed pending appeal,
within thirty (30) days or, in the case of any stay of execution or enforcement
pending appeal, within such lesser time during which such appeal may be taken;
(g) leases or subleases granted to others not interfering in any material
respect with the business of the Borrower or any of its Subsidiaries and any
interest or title of a lessor under any lease permitted by this Agreement or the
Security Documents;
12
(h) customary rights of set off, revocation, refund or chargeback under
deposit agreements or under the UCC of banks or other financial institutions
where the Borrower or any of its Subsidiaries maintains deposits in the ordinary
course of business permitted by this Agreement; and
(i) Environmental Liens, to the extent that (i) any proceedings commenced
for the enforcement of such Liens shall have been suspended or are being
contested in good faith, (ii) provision for all liability and damages that are
the subject of said Environmental Liens has been made on the books of such
Person to the extent required by GAAP and (iii) such Liens do not relate to
obligations exceeding $5,000,000 in the aggregate at any one time.
"Debt Issuance" shall mean the issuance of any Indebtedness by the Credit
Parties or any of their Subsidiaries (excluding any Equity Issuance or any
Indebtedness of the Credit Parties and their Subsidiaries permitted to be
incurred pursuant to Section 6.1 hereof (other than Section 6.1(j)).
"Declined Amount" shall have the meaning set forth in Section
2.9(b)(viii)(B).
"Default" shall mean any of the events specified in Section 7.1, whether
or not any requirement for the giving of notice or the lapse of time, or both,
or any other condition, has been satisfied.
"Defaulting Lender" shall mean, at any time, any Lender that at such time
(a) has failed to make a Loan or fund its portion of the Credit-Linked Deposit
required pursuant to the terms of this Credit Agreement, including the funding
of a Revolving Participation Interest or a Credit-Linked Participation in
accordance with the terms hereof and such default remains uncured, (b) has
failed to pay to the Administrative Agent or any Lender an amount owed by such
Lender pursuant to the terms of this Credit Agreement and such default remains
uncured, or (c) has been deemed insolvent or has become subject to a bankruptcy
or insolvency proceeding or to a receiver, trustee or similar official.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Domestic Lending Office" shall mean, initially, the office of each Lender
designated as such Lender's Domestic Lending Office located in the United States
as shown on Schedule 9.2; and thereafter, such other office of such Lender
located in the United States as such Lender may from time to time specify to the
Administrative Agent and the Borrower as the office of such Lender at which
Alternate Base Rate Loans of such Lender are to be made.
"Domestic Subsidiary" shall mean any Subsidiary that is organized and
existing under the laws of the United States or any state or commonwealth
thereof or under the laws of the District of Columbia.
"Environmental Indemnity" shall mean the Unsecured Environmental Indemnity
dated as of the Closing Date among the Credit Parties and the Administrative
Agent, for the benefit of the
13
Lenders, as the same may from time to time be amended, restated, amended and
restated, supplemented or otherwise modified in accordance with the terms hereof
and thereof.
"Environmental Laws" shall mean any and all applicable foreign, federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirement of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time be in effect during the term of this
Credit Agreement.
"Environmental Lien" shall mean a Lien in favor of any Governmental
Authority for (a) any liability under Environmental Laws, or any limitations or
restrictions placed upon any real property owned, leased or operated by the
Borrower or any of its Subsidiaries by any Government Authority or court, or (b)
damages relating to, or costs incurred by such Governmental Authority in
response to, a release or threatened release of Materials of Environmental
Concern into the environment.
"Equity Issuance" shall mean any issuance by any Credit Party or any
Subsidiary to any Person which is not a Credit Party of (a) shares of its
Capital Stock (including, without limitation, any issuance of shares of its
Capital Stock pursuant to the exercise of options or warrants or pursuant to the
conversion of any debt securities to equity) or (b) warrants or options that are
exercisable for shares of its Capital Stock. The term "Equity Issuance" shall
not include (i) any Asset Disposition, (ii) any Debt Issuance or (iii) any
equity issuance as consideration for a Permitted Acquisition.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurodollar Reserve Percentage" shall mean for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such Board as
in effect from time to time, or any similar category of liabilities for a member
bank of the Federal Reserve System in New York City.
"Event of Default" shall mean any of the events specified in Section 7.1;
provided, however, that any requirement for the giving of notice or the lapse of
time, or both, or any other condition, has been satisfied.
"Excess Cash Flow" shall mean, with respect to any fiscal year period of
the Borrower and its Subsidiaries on a Consolidated basis, an amount equal to
(a) Consolidated EBITDAP for such period plus (b) decreases in Consolidated
Working Capital for such period minus (c) Consolidated Capital Expenditures for
such period minus (d) Consolidated Interest Expense for such period to the
extent paid in cash minus (e) Consolidated Cash Taxes paid during such period
minus (f) Consolidated Scheduled Debt Payments made during such period minus (g)
the
14
sum of all optional prepayments of principal on the Term Loan minus (h) to the
extent included in the determination of Consolidated EBITDAP for such period,
cash proceeds from Permitted Real Estate Sales during such period minus (i)
increases in Consolidated Working Capital for such period and minus (j) any cash
expense associated with any unfunded post-retirement health or insurance benefit
plan of the Borrower and its Subsidiaries during such period.
"Existing Letters of Credit" shall mean the letters of credit listed on
Schedule 1.1(e).
"Existing Subordinated Notes" shall mean, collectively, the 2007
Convertible Notes, the 2013 Senior Subordinated Notes and the 2024 Convertible
Notes, as the same may be amended, restated, supplemented or otherwise modified
from time to time as permitted hereunder.
"Extension of Credit" shall mean, as to any Lender, (a) the making of a
Loan by such Lender or (b) the issuance of, or participation in, a Letter of
Credit by such Lender.
"Federal Funds Effective Rate" shall have the meaning set forth in the
definition of "Alternate Base Rate".
"Fee Letter" shall mean the letter agreement dated November 8, 2004,
addressed to the Borrower from Wachovia and WCM, as amended, modified or
otherwise supplemented.
"Fixed Charge Coverage Ratio" shall mean, for any period, the ratio of (i)
Consolidated EBITDAP for such period minus Consolidated Capital Expenditures for
such period to (ii) Consolidated Fixed Charges for such period.
"Flood Hazard Property" shall have the meaning set forth in Section
4.1(e)(v).
"Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.
"Funded Debt" shall mean, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) the maximum amount of
earnout obligations to the extent such earnout obligations appear as liabilities
on a balance sheet of such Person, (c) the principal portion of all Capital
Lease Obligations of such Person, (d) the maximum amount of all letters of
credit issued or bankers' acceptances facilities created for the account of such
Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (e) all preferred Capital Stock issued by such Person and which
by the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration, (f) the principal balance outstanding under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product, (g) all Indebtedness of others of the type described in
clauses (a) through (f) hereof secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on, or payable out of the proceeds of production from, property owned
or acquired by such Person, whether or not the obligations secured thereby have
been assumed, (h) all Guaranty Obligations of such Person with respect to
Indebtedness of another Person of the type described in clauses (a) through (f)
hereof, and (i) all
15
Indebtedness of the type described in clauses (a) through (f) hereof of any
partnership or unincorporated joint venture in which such Person is a general
partner or a joint venturer (to the extent that such Person is liable therefore)
calculated based on the percentage of such Indebtedness for which such Person is
liable; provided, however, that Funded Debt shall not include (i) Indebtedness
among the Credit Parties or (ii) Indebtedness permitted under Section 6.1(i).
"GAAP" shall mean generally accepted accounting principles in effect in
the United States of America applied on a consistent basis, subject, however, in
the case of determination of compliance with the financial covenants set out in
Section 5.9 to the provisions of Section 1.3.
"Government Acts" shall have the meaning set forth in Section 2.20.
"Governmental Approvals" shall mean all authorizations, consents,
approvals, permits, licenses and exemptions of, registrations and filings with,
and reports to, all Governmental Authorities.
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Granite Agreement" shall have the meaning set forth in Section 6.4(a).
"Guarantor" shall have the meaning set forth in the first paragraph of
this Credit Agreement.
"Guaranty" shall mean the guaranty of the Guarantors set forth in Article
X.
"Guaranty Obligations" shall mean, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (a) to purchase any such Indebtedness or
any property constituting security therefor, (b) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (d) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof. The amount of any
Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
"Hedging Agreement Provider" shall mean any Person that enters into a
Secured Hedging Agreement with a Credit Party or any of its Subsidiaries that is
permitted by Section 6.1 to the extent such Person is a Lender, an Affiliate of
a Lender or any other Person that was a Lender (or
16
an Affiliate of a Lender) at the time it entered into the Secured Hedging
Agreement but has ceased to be a Lender (or whose Affiliate has ceased to be a
Lender) under the Credit Agreement.
"Hedging Agreements" shall mean, with respect to any Person, any agreement
entered into to protect such Person against fluctuations in interest rates, or
currency or raw materials values, including, without limitation, any interest
rate swap, cap or collar agreement or similar arrangement between such Person
and one or more counterparties, any foreign currency exchange agreement,
currency protection agreements, commodity purchase or option agreements or other
interest or exchange rate hedging agreements.
"Indebtedness" shall mean, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person (other than customary
reservations or retentions of title under agreements with suppliers entered into
in the ordinary course of business), (d) all obligations (including, without
limitation, the maximum amount of earnout obligations) of such Person incurred,
issued or assumed as the deferred purchase price of property or services
purchased by such Person (other than trade debt incurred in the ordinary course
of business and due within six (6) months of the incurrence thereof) which would
appear as liabilities on a balance sheet of such Person, (e) the principal
portion of all Capital Lease Obligations of such Person, (f) the maximum amount
of all letters of credit issued or bankers' acceptances facilities created for
the account of such Person and, without duplication, all drafts drawn thereunder
(to the extent unreimbursed), (g) all preferred Capital Stock issued by such
Person and which by the terms thereof could be (at the request of the holders
thereof or otherwise) subject to mandatory sinking fund payments, redemption or
other acceleration, (h) the principal balance outstanding under any synthetic
lease, tax retention operating lease, off-balance sheet loan or similar
off-balance sheet financing product, (i) payment obligations of such Person
under non-compete agreements, (j) all obligations of such Person under Hedging
Agreements, excluding any portion thereof which would be accounted for as
interest expense under GAAP, (k) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements, (l) all
Indebtedness of others of the type described in clauses (a) through (k) hereof
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, property owned or acquired by such Person, whether
or not the obligations secured thereby have been assumed, (m) all Guaranty
Obligations of such Person with respect to Indebtedness of another Person of the
type described in clauses (a) through (k) hereof, and (n) all Indebtedness of
the type described in clauses (a) through (k) hereof of any partnership or
unincorporated joint venture in which such Person is a general partner or a
joint venturer (to the extent that such Person is liable therefore) calculated
based on the percentage of such Indebtedness for which such Person is liable.
"Insolvency" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of such term as used in
Section 4245 of ERISA.
17
"Intellectual Property" shall mean the Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trademarks and Trademark Licenses of the Credit
Parties and their Subsidiaries, all goodwill associated therewith and all rights
to ▇▇▇ for infringement thereof.
"Intercompany Note" means a demand promissory note (or a promissory note
payable on a date reasonably satisfactory to the Administrative Agent) issued by
a Subsidiary directly to the Borrower in form and substance that is satisfactory
to the Administrative Agent.
"Interest Coverage Ratio" shall mean the ratio of (a) Consolidated EBITDAP
for such period to (b) Consolidated Interest Expense net of interest income for
such period.
"Interest Payment Date" shall mean (a) as to any Alternate Base Rate Loan,
the last day of each March, June, September and December and on the applicable
Maturity Date, (b) as to any LIBOR Rate Loan having an Interest Period of three
(3) months or less, the last day of such Interest Period, (c) as to any LIBOR
Rate Loan having an Interest Period longer than three (3) months, (i) each three
(3) month anniversary following the first day of such Interest Period and (ii)
the last day of such Interest Period and (d) as to any Loan which is the subject
of a mandatory prepayment required pursuant to Section 2.9(b), the date on which
such mandatory prepayment is due.
"Interest Period" shall mean, with respect to any LIBOR Rate Loan,
(a) initially, the period commencing on the Borrowing Date or
conversion date, as the case may be, with respect to such LIBOR Rate Loan
and ending one, two, three or six months thereafter, subject to
availability to all applicable Lenders, as selected by the Borrower in the
Notice of Borrowing or Notice of Conversion given with respect thereto;
and
(b) thereafter, each period commencing on the last day of the
immediately preceding Interest Period applicable to such LIBOR Rate Loan
and ending one, two, three or six months thereafter, subject to
availability to all applicable Lenders, as selected by the Borrower by
irrevocable notice to the Administrative Agent not less than three
Business Days prior to the last day of the then current Interest Period
with respect thereto; provided that the foregoing provisions are subject
to the following:
(i) if any Interest Period pertaining to a LIBOR Rate Loan
would otherwise end on a day that is not a Business Day, such
Interest Period shall be extended to the next succeeding Business
Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business Day;
(ii) any Interest Period pertaining to a LIBOR Rate Loan that
begins on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Business Day of the relevant calendar month;
18
(iii) if the Borrower shall fail to give notice as provided
above, the Borrower shall be deemed to have selected an Alternate
Base Rate Loan to replace the affected LIBOR Rate Loan;
(iv) no Interest Period in respect of any Loan shall extend
beyond the applicable Maturity Date and, further with regard to any
Term Loan, no Interest Period shall extend beyond any principal
amortization payment date with respect to such Term Loan unless the
portion of such Term Loan consisting of Alternate Base Rate Loans
together with the portion of such Term Loan consisting of LIBOR Rate
Loans with Interest Periods expiring prior to or concurrently with
the date such principal amortization payment date is due, is at
least equal to the amount of such principal amortization payment due
on such date; and
(v) no more than eight (8) LIBOR Rate Loans may be in effect
at any time. For purposes hereof, LIBOR Rate Loans with different
Interest Periods shall be considered as separate LIBOR Rate Loans,
even if they shall begin on the same date, although borrowings,
extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to
constitute a new LIBOR Rate Loan with a single Interest Period.
"Investment" shall mean (a) the acquisition (whether for cash, property,
services, assumption of Indebtedness, securities or otherwise) of shares of
Capital Stock, other ownership interests or other securities of any Person or
bonds, notes, debentures or all or substantially all of the assets of any Person
or (b) any deposit with, or advance, loan or other extension of credit to, any
Person (other than deposits made in the ordinary course of business) or (c) any
other capital contribution to or investment in any Person, including, without
limitation, any Guaranty Obligation (including any support for a letter of
credit issued on behalf of such Person) incurred for the benefit of such Person.
"Issuing Lenders" shall mean, as of any date of determination, the
Administrative Agent and any other Credit-Linked Issuing Lender or Revolving
Issuing Lender that has issued a Letter of Credit that is outstanding on such
date of determination.
"Issuing Lender Fees" shall have the meaning set forth in Section 2.7(e).
"Joinder Agreement" shall mean a Joinder Agreement in substantially the
form of Schedule 5.10, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 5.10.
"Joint Venture" means any corporation, partnership, limited liability
company, joint venture or other similar legal arrangement (whether created by
contract or conducted through a separate legal entity) now or hereafter formed
by the Borrower or any of its Subsidiaries with another Person that is not the
Borrower or any Subsidiary in order to conduct a common venture or enterprise
with such Person.
19
"Lender" shall have the meaning set forth in the first paragraph of this
Credit Agreement and shall include each Issuing Lender.
"Letters of Credit" shall mean, collectively, the Revolving Letters of
Credit and the Credit-Linked Letters of Credit.
"Leverage Ratio" shall mean, as of any date of determination, the ratio of
(i) Consolidated Funded Debt on such date minus Performance Based Letters of
Credit on such date minus, so long as there are no Revolving Loans outstanding,
unrestricted cash held by the Credit Parties on such date to (ii) Consolidated
EBITDAP.
"LIBOR" shall mean, for any LIBOR Rate Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two (2) Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "LIBOR" shall mean, for any LIBOR Rate Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two (2) Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; provided, however, if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates (rounded upwards, if necessary,
to the nearest 1/100 of 1%). If, for any reason, neither of such rates is
available, then "LIBOR" shall mean the rate per annum at which, as determined by
the Administrative Agent, Dollars in an amount comparable to the Loans then
requested are being offered to leading banks at approximately 11:00 A.M. London
time, two (2) Business Days prior to the commencement of the applicable Interest
Period for settlement in immediately available funds by leading banks in the
London interbank market for a period equal to the Interest Period selected.
"LIBOR Lending Office" shall mean, initially, the office of each Lender
designated as such Lender's LIBOR Lending Office shown on Schedule 9.2; and
thereafter, such other office of such Lender as such Lender may from time to
time specify to the Administrative Agent and the Borrower as the office of such
Lender at which the LIBOR Rate Loans of such Lender are to be made.
"LIBOR Rate" shall mean a rate per annum (rounded upwards, if necessary,
to the next higher 1/100th of 1%) determined by the Administrative Agent
pursuant to the following formula:
LIBOR Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" shall mean Loans the rate of interest applicable to
which is based on the LIBOR Rate.
20
"Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Capital Lease having
substantially the same economic effect as any of the foregoing).
"Litigation Award" shall mean the receipt by the Borrower or any of its
Subsidiaries of cash or Cash Equivalents from any arbitration award, settlement,
court judgment or other award, judgment or settlement received in any
litigation-related proceeding.
"Loan" shall mean a Revolving Loan, a Swingline Loan and/or a Term Loan,
as appropriate.
"Loan to Value Test" shall mean, as of any date of determination, the
aggregate principal amount of the outstanding Term Loans plus the Credit-Linked
LOC Commitment is less than fifty percent (50%) of the appraised value of the
Credit Parties' owned real property based on the most recent appraisals
delivered to and acceptable to the Administrative Agent (including any new
appraisal obtained for purposes of determining compliance with such test as the
Administrative Agent may reasonably deem appropriate at such time; provided that
new appraisals shall not be ordered more than once annually).
"LOC Documents" shall mean, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor, and any agreements, instruments, guarantees
or other documents (whether general in application or applicable only to such
Letter of Credit) governing or providing for (i) the rights and obligations of
the parties concerned or (ii) any collateral security for such obligations.
"Mandatory LOC Borrowing" shall have the meaning set forth in Section
2.2(e).
"Mandatory Swingline Borrowing" shall have the meaning set forth in
Section 2.3(b)(ii).
"Material Adverse Effect" shall mean a material adverse effect on (a) the
business, operations, property, assets or financial condition of the Borrower or
of the Credit Parties and their Subsidiaries taken as a whole, (b) the ability
of the Borrower or any Guarantor to perform its obligations, when such
obligations are required to be performed, under this Credit Agreement, any of
the Notes or any other Credit Document or (c) the validity or enforceability of
this Credit Agreement, any of the Notes or any of the other Credit Documents or
the rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.
"Material Contract" shall mean (a) any contract or other agreement,
written or oral, of the Credit Parties or any of their Subsidiaries representing
at least 7.5% of the total Consolidated revenues of the Credit Parties and their
Subsidiaries for any fiscal year and (b) any other contract, agreement, permit
or license, written or oral, of the Credit Parties or any of their Subsidiaries
as to which the breach, nonperformance, cancellation or failure to renew in
accordance with the terms thereof by any party thereto, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
21
"Material Domestic Subsidiary" shall mean any Domestic Subsidiary of any
Credit Party, the Consolidated Total Assets of which were more than 7.5% of the
Consolidated Total Assets of the Borrower and its Subsidiaries as of the end of
the most recently completed fiscal year of the Borrower for which audited
financial statements are available; provided that, in the event the aggregate of
the Consolidated Total Assets of all Domestic Subsidiaries that do not
constitute Material Domestic Subsidiaries exceeds 7.5% of the Consolidated Total
Assets of the Borrower and its Subsidiaries as of such date, the Borrower (or
the Administrative Agent, in the event the Borrower has failed to do so within
ten (10) days of request therefor by the Administrative Agent) shall, to the
extent necessary, designate sufficient Domestic Subsidiaries to be deemed to be
"Material Domestic Subsidiaries" to eliminate such excess, and such designated
Domestic Subsidiaries shall thereafter constitute Material Domestic
Subsidiaries. Assets of Foreign Subsidiaries shall be converted into Dollars at
the rates used for purposes of preparing the consolidated balance sheet of the
Borrower included in such audited financial statements.
"Material Foreign Subsidiary" shall mean any Foreign Subsidiary of any
Credit Party, the Consolidated Total Assets of which were more than 7.5% of the
Consolidated Total Assets of the Borrower and its Subsidiaries as of the end of
the most recently completed fiscal year of the Borrower for which audited
financial statements are available; provided that, in the event the aggregate of
the Consolidated Total Assets of all Foreign Subsidiaries that do not constitute
Material Foreign Subsidiaries exceeds 7.5% of the Consolidated Total Assets of
the Borrower and its Subsidiaries as of such date, the Borrower (or the
Administrative Agent, in the event the Borrower has failed to do so within ten
(10) days of request therefor by the Administrative Agent) shall, to the extent
necessary, designate sufficient Foreign Subsidiaries to be deemed to be
"Material Foreign Subsidiaries" to eliminate such excess, and such designated
Foreign Subsidiaries shall thereafter constitute Material Foreign Subsidiaries.
Assets of Foreign Subsidiaries shall be converted into Dollars at the rates used
for purposes of preparing the consolidated balance sheet of the Borrower
included in such audited financial statements.
"Materials of Environmental Concern" shall mean any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" shall mean the Credit-Linked Maturity Date or the
Revolving Commitment Termination Date, as applicable.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage Instrument" shall mean any mortgage, deed of trust, deed to
secure debt or assignment of leases and rents executed by a Credit Party in
favor of the Administrative Agent pursuant to the terms of Section 4.1(e)(i),
5.10 or 5.12, as the same may be amended, modified, restated or supplemented
from time to time.
"Mortgage Policy" shall mean, with respect to any Mortgage Instrument, an
ALTA mortgagee title insurance policy issued by a Title Company in such amount
as reasonably
22
approved by the Administrative Agent, assuring the Administrative Agent that
such Mortgage Instrument creates a valid and enforceable first priority mortgage
lien on the applicable Mortgaged Property, free and clear of all defects and
encumbrances except Permitted Liens, which Mortgage Policy shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall provide
for affirmative insurance and such reinsurance as the Administrative Agent may
reasonably request.
"Mortgaged Property" shall mean any owned or leased real property of a
Credit Party with respect to which such Credit Party executes a Mortgage
Instrument in favor of the Administrative Agent.
"Multiemployer Plan" shall mean a Plan that is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" shall mean the aggregate cash proceeds received by any
Credit Party or any Subsidiary in respect of any Asset Disposition, Equity
Issuance, Debt Issuance, Recovery Event or Litigation Award, net of (a) direct
costs (including, without limitation, legal, accounting and investment banking
fees, and sales commissions) associated therewith, (b) amounts held in escrow to
be applied as part of the purchase price of any Asset Disposition, (c) taxes
paid or payable as a result thereof, (d) with respect to any Asset Disposition
or Recovery Event, payment of the outstanding principal amount of, premium (if
any) and interest on any Indebtedness secured by a Lien on the assets subject to
such Asset Disposition or Recovery Event and (e) with respect to any Recovery
Event or Litigation Award, amounts payable directly or indirectly to
Governmental Authorities for such Recovery Event or Litigation Award to the
extent required by such Governmental Authorities or Contractual Obligations; it
being understood that "Net Cash Proceeds" shall include, without limitation, any
cash proceeds from the sale or other disposition of any non-cash consideration
(but only as and when such cash is actually received) received by any Credit
Party or any Subsidiary in any Asset Disposition, Equity Issuance, Debt
Issuance, Recovery Event or Litigation Award and any cash released from escrow
as part of the purchase price in connection with any Asset Disposition.
"New Convertible Notes" shall mean the Borrower's 2.25% unsecured
subordinated convertible notes due 2024, as the same may be amended, restated,
supplemented or otherwise modified from time to time as permitted hereunder.
"Non-Cash Non-Operating" shall mean (i) all non-cash expenses or income
incurred outside the normal course of business of the Credit Parties including
environmental reserve adjustments, litigation settlements and awards, business
restructuring costs and charges associated with impairments of tangible and
intangible assets, and (ii) (without duplication) all expenses reflected as a
restructuring item, unusual item, or the cumulative effect of a change in
accounting principle in the public financial statements of the Borrower.
"Note" or "Notes" shall mean the Revolving Notes, the Swingline Notes, the
Credit-Linked Note and/or the Term Loan Notes, collectively, separately or
individually, as appropriate.
23
"Notice of Borrowing" shall mean a request for a Revolving Loan borrowing
pursuant to Section 2.1(b)(i) or a request for a Swingline Loan borrowing
pursuant to Section 2.3(b)(i), as appropriate, in substantially the form of the
notice of borrowing attached hereto as Schedule 2.1(b)(i).
"Notice of Conversion" shall have the meaning set forth in Section 2.11.
"Obligations" shall mean, collectively, Loans, Revolving LOC Obligations
and Credit-Linked LOC Obligations and all other obligations of the Credit
Parties to the Administrative Agent and the Lenders under the Credit Documents.
"OFAC" shall mean the U.S. Department of the Treasury's Office of Foreign
Assets Control.
"Other Parties" shall have the meaning set forth in Section 10.7(c).
"Participant" shall have the meaning set forth in Section 9.6(b).
"Participation Interests" shall mean Revolving Participation Interests or
Credit-Linked Participations, individually or collectively as the context may
require.
"Patent Licenses" shall mean all agreements, whether written or oral,
providing for the grant by or to a Person of any right to manufacture, use or
sell any invention covered by a Patent, including, without limitation, any
thereof referred to in Schedule 3.16 to this Credit Agreement.
"Patents" shall mean all letters patent of the United States or any other
country, now existing or hereafter arising, and all improvement patents,
reissues, reexaminations, patents of additions, renewals and extensions thereof,
including, without limitation, any thereof referred to in Schedule 3.16 to this
Credit Agreement, and (ii) all applications for letters patent of the United
States or any other country, now existing or hereafter arising, and all
provisionals, divisions, continuations and continuations-in-part and substitutes
thereof, including, without limitation, any thereof referred to in Schedule 3.16
to this Credit Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Performance Based Letters of Credit" shall mean letters of credit backing
advanced deposits or performance based contracts.
"Permitted Acquisition" shall mean an acquisition or any series of related
acquisitions by a Credit Party of (a) all or substantially all of the assets or
a majority of the outstanding Voting Securities or economic interests of a
Person that is incorporated, formed or organized in the United States or (b) any
division, line of business or other business unit of a Person that is
incorporated, formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person shall be
referred to herein as the "Target"), in each case that is a type of business (or
assets used in a type of business) permitted to be engaged in by
24
the Credit Parties and their Subsidiaries pursuant to Section 6.3, so long as
(i) no Default or Event of Default shall then exist or would exist after giving
effect thereto, (ii) the Credit Parties shall demonstrate to the reasonable
satisfaction of the Administrative Agent and the Required Lenders that, after
giving effect to the acquisition on a pro forma basis, the Credit Parties are in
compliance with each of the financial covenants set forth in Section 5.9, (iii)
the Administrative Agent, on behalf of the Lenders, shall have received (or
shall receive in connection with the closing of such acquisition) a first
priority perfected security interest in all property (including, without
limitation, Capital Stock) acquired with respect to the Target in accordance
with the terms of Sections 5.10 and 5.12 and the Target, if a it would be a
Material Domestic Subsidiary, shall have executed a Joinder Agreement in
accordance with the terms of Section 5.10, (iv) the Administrative Agent and the
Lenders shall have received (A) a description of the material terms of such
acquisition and (B) if the total consideration (including without limitation
earn out obligations, deferred compensation, non-competition arrangements and
the amount of Indebtedness and other liabilities assumed by the Credit Parties
and their Subsidiaries) to be paid by the Credit Parties and their Subsidiaries
in connection with such acquisition exceeds $25,000,000, (1) audited financial
statements (or, if unavailable, management-prepared financial statements) of the
Target for its two most recent fiscal years and for any fiscal quarters ended
within the fiscal year to date and (2) consolidated projected income statements
of the Borrower and its consolidated Subsidiaries (giving effect to such
acquisition), all in form and substance reasonably satisfactory to the
Administrative Agent, (v) the Target shall have earnings before interest, taxes,
depreciation, amortization and non-cash and pension plan income or expenses for
the four fiscal quarter period prior to the acquisition date in an amount
greater than $0, (vi) such acquisition shall not be a "hostile" acquisition and
the appropriate approvals of the applicable Credit Party and the Target shall
have been obtained, (vii) after giving effect to such acquisition, there shall
be at least $50,000,000 of borrowing availability under the Revolving Committed
Amount and (viii) the aggregate (A) cash consideration (including, without
limitation, earn out obligations, deferred compensation and payments under
non-competition arrangements) paid (or to be paid) by the Credit Parties and
their Subsidiaries in connection with any such acquisition shall not exceed
$25,000,000 and (B) total consideration (including, without limitation, (1) the
maximum amount of earnout obligations, (2) deferred compensation, (3) payments
under non-competition arrangements and (4) the amount of Indebtedness and other
liabilities assumed by the Credit Parties and their Subsidiaries) paid (or to be
paid) by the Credit Parties and their Subsidiaries in connection with any such
acquisition shall not exceed $100,000,000.
"Permitted Investments" shall mean:
(a) cash and Cash Equivalents;
(b) Investments set forth on Schedule 1.1(b), which Investments
shall not exceed the amount thereof on the Closing Date (after giving
effect to the Transactions consummated on the Closing Date), in each case
as such Investments may be adjusted due to appreciation, repayment of
principal, payment of interest, return of capital or similar
circumstances; provided, however, any such Investment consisting of
intercompany Indebtedness owed by a Credit Party to a Subsidiary that is
not a Credit Party shall not be repaid in cash or Cash Equivalents and
shall not be renewed, extended, refinanced or replaced; provided further,
however, the Credit Parties shall be permitted to
25
write-off Investments consisting of intercompany Indebtedness owing by
Subsidiaries that are not Credit Parties to the extent such Indebtedness
was existing prior to the Closing Date;
(c) receivables owing to the Credit Parties or any of their
Subsidiaries or any receivables and advances to suppliers, in each case if
created, acquired or made in the ordinary course of business and payable
or dischargeable in accordance with customary trade terms;
(d) (i) loans and advances to employees for relocation and related
expenses and (ii) loans and advances to employees in the ordinary course
of business in an aggregate principal amount not exceeding $1,500,000;
provided that such loans and advances shall comply with all applicable
Requirements of Law;
(e) Investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of business;
(f) Investments (including debt securities) received as
consideration for Permitted Real Estate Sales to the extent such
Investments, together with all other non-cash consideration received for
such Permitted Real Estate Sales, do not exceed $75,000,000 in the
aggregate;
(g) Hedging Agreements permitted hereunder;
(h) deposits in a customary fashion in the ordinary course of
business;
(i) Investments in and unsecured loans to any Credit Party by any
Credit Party or any of its Subsidiaries; provided, however, that in the
case of such intercompany loan or advance by a Credit Party to another
Credit Party, each such loan shall be evidenced by an Intercompany Note
payable to the Credit Party, in form and substance satisfactory to
Administrative Agent, which Intercompany Notes shall be delivered and
pledged to the Administrative Agent as part of the Collateral;
(j) Permitted Acquisitions and Investments assumed in connection
with Permitted Acquisitions;
(k) Guaranty Obligations permitted pursuant to Section 6.1(h) and
6.1(k);
(l) Investments in the GDX facility in Chartres, France in order to
fund the cash costs in connection with the closure of such facility in an
aggregate amount not to exceed $20,000,000; and
26
(m) additional loans, advances and/or Investments of a nature not
contemplated by the foregoing clauses hereof in an aggregate amount not to
exceed $15,000,000 outstanding at any time.
"Permitted Joint Venture" shall mean a Joint Venture established by a
Credit Party for the purpose of developing and/or selling one or more real
properties of the Credit Parties.
"Permitted Liens" shall mean:
(a) Liens created by or otherwise existing under or in connection
with this Credit Agreement or the other Credit Documents in favor of the
Secured Parties;
(b) Liens in favor of a Hedging Agreement Provider in connection
with a Secured Hedging Agreement; provided that such Liens shall secure
the Credit Party Obligations and the obligations under such Secured
Hedging Agreement on a pari passu basis;
(c) Liens securing purchase money indebtedness and Capital Lease
Obligations (and refinancings thereof) to the extent permitted under
Section 6.1(c); provided, that (i) any such Lien attaches to such property
concurrently with or within (120) days after the acquisition thereof and
(ii) such Lien attaches solely to the property so acquired in such
transaction;
(d) Customary Permitted Liens;
(e) Liens existing on the Closing Date listed on Schedule 1.1(c)
hereto and any extension, renewal or replacement thereof but only if the
principal amount of the Indebtedness (including, for purposes of this
clause (e), any additional Indebtedness incurred pursuant to revolving
commitments in an amount not in excess of the available commitment as set
forth on Schedule 6.1(b) secured thereby) is not increased and such Liens
do not extend to or cover any other property or assets;
(f) Liens securing Indebtedness permitted pursuant to Section
6.1(d); provided, that any such Lien does not extend to any other property
(other than accessions and additions to the property secured thereby);
(g) Liens on special tooling assets and Intellectual Property of
Aerojet as required by the terms of the contract with Lockheed ▇▇▇▇▇▇
regarding the Atlas Program;
(h) Liens securing the financing of insurance premiums associated
with insurance coverage obtained in the normal course of business not to
exceed $7,000,000 in the aggregate at any time outstanding; and
(i) additional Liens (other than Liens on any real property owned by
the Borrower or any of its Subsidiaries which is located in the State of
California or the State of Nevada) incurred by the Borrower and its
Subsidiaries which do not secure
27
Indebtedness for money borrowed so long as the value of the property
subject to such Liens, and the obligations secured thereby, do not exceed
$5,000,000 in the aggregate at any one time outstanding.
In connection with the granting of Liens of the type described in clause
(c) above by the Borrower or any of its Subsidiaries, at the reasonable request
of the Borrower, and at the Borrower's expense, the Administrative Agent shall
take (and is hereby authorized to take) any actions reasonably requested by the
Borrower in connection therewith (including, without limitation, by executing
appropriate lien releases in favor of the holder or holders of such Liens, in
either case solely with respect to the item or items of equipment or other
assets subject to such Liens).
"Permitted Real Estate Sales" shall mean (a) the sale of any owned or
leased real property of a Credit Party, (b) the contribution, sale or other
transfer of any owned or leased real property of a Credit Party to a Permitted
Joint Venture, (c) the sale of any owned or leased real property by a Permitted
Joint Venture to the extent such owned or leased real property was contributed,
sold or otherwise transferred to such Permitted Joint Venture by a Credit Party
and (d) the sale of any ownership interest (or economic interest) in a Permitted
Joint Venture, in each case that satisfies the following requirements: (i) with
respect to sales under clauses (a), (b) or (d) above, no Default or Event of
Default shall exist at the time of such sale or be caused by such sale, (ii)
such sale is for fair market value, (iii) the Net Cash Proceeds of such sale are
applied to the Loans to the extent required pursuant to Section 2.9(b), and (iv)
unless otherwise approved by the Required Lenders with respect to (a) and (b)
above (without duplication), (A) the total consideration received by the Credit
Parties for such sale, contribution or other transfer, when combined with the
total consideration received by the Credit Parties for all other Permitted Real
Estate Sales under clauses (a) and (b) above, shall not exceed $150,000,000 in
the aggregate for all such Permitted Real Estate Sales and (B) the non-cash
consideration received by the Credit Parties for such sale, contribution or
other transfer, when combined with the non-cash consideration received by the
Credit Parties for all other Permitted Real Estate Sales under clauses (a) and
(b) above, shall not exceed $75,000,000 in the aggregate for all such Permitted
Real Estate Sales.
"Permitted Real Property Encumbrances" shall mean (a) those liens,
encumbrances and other matters affecting title to any Mortgaged Property listed
in the applicable Mortgage Policy in respect thereof (or any update thereto) and
found, on the date of delivery of such Mortgage Policy to the Administrative
Agent in accordance with the terms hereof, reasonably acceptable by the
Administrative Agent, (b) as to any particular real property at any time, such
easements, encroachments, covenants, restrictions, rights of way, minor defects,
irregularities or encumbrances on title which do not, in the reasonable opinion
of the Administrative Agent, materially impair such real property for the
purpose for which it is held by the mortgagor or owner, as the case may be,
thereof, or the Lien held by the Administrative Agent, (c) municipal and zoning
laws, regulations, codes and ordinances, which are not violated in any material
respect by the existing improvements and the present use made by the mortgagor
or owner, as the case may be, of such real property, (d) general real estate
taxes and assessments not yet delinquent, and (e) such other items to which the
Administrative Agent may consent.
28
"Person" shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"Plan" shall mean, at any particular time, any employee benefit plan which
is covered by Title IV of ERISA and in respect of which the Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Pledge Agreement" shall mean the Pledge Agreement dated as of the Closing
Date given by the Borrower and the Guarantors to the Administrative Agent, for
the benefit of the Secured Parties, as the same may from time to time be
amended, restated, amended and restated, supplemented or otherwise modified in
accordance with the terms hereof and thereof.
"Prime Rate" shall have the meaning set forth in the definition of
Alternate Base Rate.
"Properties" shall have the meaning set forth in Section 3.10(a).
"Purchasing Lenders" shall have the meaning set forth in Section 9.6(c).
"Recovery Event" shall mean the receipt by the Credit Parties or any of
their Subsidiaries of any cash insurance proceeds or condemnation or
expropriation award payable by reason of theft, loss, physical destruction or
damage, taking or similar event with respect to any of their respective property
or assets other than obsolete property or assets no longer used or useful in the
business of the Credit Parties or any of their Subsidiaries.
"Register" shall have the meaning set forth in Section 9.6(d).
"Reorganization" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of such term as
used in Section 4241 of ERISA.
"Reportable Event" shall mean any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty-day notice
period is waived under PBGC Reg. Section 4043.
"Required Lenders" shall mean, at any time, Lenders holding in the
aggregate more than fifty percent (50%) of (a) the sum of (i) the Revolving
Commitments and (ii) the Credit-Linked Commitments or (b) if the Commitments
have been terminated, the sum of the outstanding Revolving Loans, Term Loans and
Participation Interests; provided, however, that if any Lender shall be a
Defaulting Lender at such time, then there shall be excluded from the
determination of Required Lenders the Commitments of such Lender or, after
termination of the Commitments, the outstanding Revolving Loans, Term Loans and
Participation Interests of such Lender.
"Required Secured Parties" shall mean, at any time, Lenders and Hedging
Agreement Providers holding in the aggregate more than fifty percent (50%) of
(a) the sum of (i) the
29
Revolving Commitments, (ii) the Credit-Linked Commitments and (iii) the
termination value of all Secured Hedging Agreements (whether or not actually
terminated) or (b) if the Commitments have been terminated, the sum of (i) the
outstanding Revolving Loans, Term Loans and Participation Interests and (ii) the
termination value of all Secured Hedging Agreements; provided, however, that if
any Lender shall be a Defaulting Lender at such time, then there shall be
excluded from the determination of Required Secured Parties the Commitments of
such Lender or, after termination of the Commitments, the outstanding Revolving
Loans, Term Loans and Participation Interests of such Lender.
"Requirement of Law" shall mean, as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents of such
Person, and each law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Responsible Officer" shall mean, as to (a) the Borrower, the Chief
Executive Officer, Chief Financial Officer, the President or any Vice President
or (b) any other Credit Party, any duly authorized officer thereof.
"Restricted Payment" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
any Credit Party or any of its Subsidiaries, now or hereafter outstanding, (b)
any redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of Capital
Stock of any Credit Party or any of its Subsidiaries, now or hereafter
outstanding, (c) any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any class of
Capital Stock of any Credit Party or any of its Subsidiaries, now or hereafter
outstanding, (d) any payment with respect to any earnout obligation, (e) any
payment, prepayment, redemption or similar payment with respect to any
Subordinated Debt of any Credit Party or any of its Subsidiaries and (f) to the
extent not included in the corporate overhead of such Credit Party or such
Subsidiary, the payment by any Credit Party or any of its Subsidiaries of any
management, advisory or consulting fee to any Person or the payment of any
extraordinary salary, bonus or other form of compensation to any Person who is
directly or indirectly a significant partner, shareholder, owner or executive
officer of any such Person.
"Revolving Commitment" shall mean, with respect to each Revolving Lender,
the commitment of such Revolving Lender to make Revolving Loans in an aggregate
principal amount at any time outstanding up to an amount equal to such Revolving
Lender's Revolving Commitment Percentage of the Revolving Committed Amount.
"Revolving Commitment Fee" shall have the meaning set forth in Section
2.7(a).
"Revolving Commitment Percentage" shall mean, for each Revolving Lender,
the percentage identified as its Revolving Commitment Percentage on Schedule
2.1(a) or in the Register, as such percentage may be modified in connection with
any assignment made in accordance with the provisions of Section 9.6(c).
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"Revolving Commitment Period" shall mean (a) with respect to Revolving
Loans, the period from and including the Closing Date to but excluding the
Revolving Commitment Termination Date and (b) with respect to Revolving Letters
of Credit, the period from and including the Closing Date to but excluding the
date that is thirty (30) days prior to the Revolving Commitment Termination
Date.
"Revolving Commitment Termination Date" shall mean the earlier of (a) the
date that is five (5) years after the Closing Date and (b) to the extent
applicable, the Accelerated Maturity Date.
"Revolving Committed Amount" shall have the meaning set forth in Section
2.1(a).
"Revolving Issuing Lender" shall mean, with respect to any Revolving
Letter of Credit, the Administrative Agent or such other Lender as requested by
the Borrower and approved by the Administrative Agent, or any other Person that
was the Administrative Agent or a Lender at the time it issued such Revolving
Letter of Credit but has ceased to be the Administrative Agent or a Lender under
the Credit Agreement.
"Revolving Lender" shall mean, as of any date of determination, a Lender
holding a Revolving Commitment on such date.
"Revolving Letters of Credit" shall mean any letter of credit issued by
the Revolving Issuing Lender pursuant to Section 2.2(a), as such letter of
credit may be amended, modified, extended, renewed or replaced from time to
time.
"Revolving Loan" shall have the meaning set forth in Section 2.1.
"Revolving LOC Commitment" shall mean the commitment of the Revolving
Issuing Lender to issue Revolving Letters of Credit and with respect to each
Revolving Lender, the commitment of such Revolving Lender to purchase
participation interests in the Letters of Credit up to such Revolving Lender's
LOC Commitment as specified in Schedule 2.1(a) or in the Register, as such
amount may be reduced from time to time in accordance with the provisions
hereof.
"Revolving LOC Commitment Fee" shall have the meaning set forth in Section
2.7(c).
"Revolving LOC Committed Amount" shall have the meaning set forth in
Section 2.2(a).
"Revolving LOC Fronting Fee" shall have the meaning set forth in
Section 2.7(c).
"Revolving LOC Obligations" shall mean, at any time, the sum of (i) the
maximum amount which is, or at any time thereafter may become, available to be
drawn under Revolving Letters of Credit then outstanding, assuming compliance
with all requirements for drawings referred to in such Revolving Letters of
Credit plus (ii) the aggregate amount of all drawings
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under Revolving Letters of Credit honored by the Revolving Issuing Lender but
not theretofore reimbursed.
"Revolving Note" or "Revolving Notes" shall mean the promissory notes of
the Borrower (if any) made by the Borrower pursuant to Section 2.1(e) and
payable to the order of any of the Revolving Lenders evidencing the Revolving
Loans provided by any such Revolving Lender, individually or collectively, as
appropriate, as such promissory notes may be amended, modified, restated,
amended and restated, supplemented, extended, renewed or replaced from time to
time.
"Revolving Participation Interest" shall mean a participation interest
purchased by a Revolving Lender in LOC Obligations as provided in Section 2.2(c)
and in Swingline Loans as provided in Section 2.3.
"S&P" shall mean Standard & Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"Sanctioned Country" shall mean a country subject to a sanctions program
identified on the list maintained by OFAC and available at
▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇/▇▇▇▇/▇▇▇▇▇▇▇▇▇/▇▇▇▇▇.▇▇▇▇, or as otherwise
published from time to time.
"Sanctioned Person" shall mean (i) a person named on the list of Specially
Designated Nationals or Blocked Persons maintained by OFAC available at
▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇/▇▇▇▇/▇▇▇/▇▇▇▇▇.▇▇▇▇, or as otherwise
published from time to time, or (ii) (A) an agency of the government of a
Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or
(C) a person resident in a Sanctioned Country, to the extent subject to a
sanctions program administered by OFAC.
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto.
"Secured Hedging Agreement" shall mean any Hedging Agreement between a
Credit Party and a Hedging Agreement Provider, as amended, restated, amended and
restated, modified, supplemented or extended from time to time.
"Secured Parties" shall mean the Lenders and the Hedging Agreement
Providers.
"Security Agreement" shall mean the Security Agreement dated as of the
Closing Date given by the Borrower and the Guarantors to the Administrative
Agent, for the benefit of the Secured Parties, as amended, restated, amended and
restated, modified or supplemented from time to time in accordance with its
terms.
"Security Documents" shall mean the Security Agreement, the Pledge
Agreement, the Mortgage Instruments and such other documents executed and
delivered and/or filed in connection with the attachment and perfection of the
Administrative Agent's security interests and liens arising thereunder,
including, without limitation, UCC financing statements and patent, trademark
and copyright filings.
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"Senior Consolidated Funded Debt" shall mean all Consolidated Funded Debt
excluding any Subordinated Debt.
"Senior Leverage Ratio" shall mean, as of any date of determination, the
ratio of (a) Senior Consolidated Funded Debt on such date minus Performance
Based Letters of Credit on such date minus, so long as there are no Revolving
Loans outstanding, unrestricted cash held by the Credit Parties on such date to
(b) Consolidated EBITDAP minus Consolidated EBITDAP attributable to any real
property sold during the period of calculation minus Consolidated EBITDAP
attributable to the Granite Agreement for the fiscal year of the Borrower ended
November 30, 2004 minus cash dividends and distributions received by the
Borrower and its Subsidiaries from Permitted Joint Ventures during such period.
"Shortfall Amount" shall mean, for any period of determination, the amount
by which the interest that would be payable for such fiscal period for a LIBOR
Rate borrowing in the amount of the Credit-Linked Deposits and with a one month
or three month interest period (as such interest period is determined by the
Administrative Agent from time to time) exceeds the return on the investment of
the Credit-Linked Deposits in the Credit-Linked Account for such period.
"Single Employer Plan" shall mean any Plan that is not a Multiemployer
Plan.
"Specified Sales" shall mean the sale, transfer, lease or other
disposition of (a) inventory and materials in the ordinary course of business
and (b) cash into Cash Equivalents or Cash Equivalents into cash.
"Subordinated Debt" shall mean any Indebtedness incurred by any Credit
Party (including, without limitation, the Existing Subordinated Notes and the
New Convertible Notes) which by its terms is specifically subordinated in right
of payment to the prior payment of the Credit Party Obligations and contains
subordination and other terms acceptable to the Administrative Agent.
"Subsidiary" shall mean, as to any Person, a corporation, partnership,
limited liability company or other entity (other than a Permitted Joint Venture)
of which shares of stock or other ownership interests having ordinary voting
power (other than stock or such other ownership interests having such power only
by reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership, limited liability
company or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to a
"Subsidiary" or to "Subsidiaries" in this Credit Agreement shall refer to a
Subsidiary or Subsidiaries of the Borrower.
"Swingline Commitment" shall mean the commitment of the Swingline Lender
to make Swingline Loans in an aggregate principal amount at any time outstanding
up to the Swingline Committed Amount, and the commitment of the Revolving
Lenders to purchase participation interests in the Swingline Loans as provided
in Section 2.3(a), as such amounts may be reduced from time to time in
accordance with the provisions hereof.
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"Swingline Committed Amount" shall mean the amount of the Swingline
Lender's Swingline Commitment as specified in Section 2.3(a).
"Swingline Lender" shall mean the Administrative Agent and any successor
swingline lender.
"Swingline Loan" shall have the meaning set forth in Section 2.3(a).
"Swingline Note" shall mean the promissory note of the Borrower in favor
of the Swingline Lender evidencing the Swingline Loans provided pursuant to
Section 2.3(d), as such promissory note may be amended, modified, supplemented,
extended, renewed or replaced from time to time.
"Tax Exempt Certificate" shall have the meaning set forth in Section 2.19.
"Taxes" shall have the meaning set forth in Section 2.19.
"Term Loan" shall mean any term loan made by a Credit-Linked Lender
pursuant to Section 2.5(a) or any term loan into which a Credit-Linked Purchase
is converted pursuant to Section 2.5(d)(ii).
"Term Loan Commitment" shall mean, with respect to each Credit-Linked
Lender, the commitment of such Credit-Linked Lender to make Term Loans in a
principal amount equal to such Credit-Linked Lender's Term Loan Commitment
Percentage of the Term Loan Committed Amount.
"Term Loan Commitment Percentage" shall mean, for any Lender, the
percentage identified as its Term Loan Commitment Percentage on Schedule 2.1(a)
or in the Register, as such percentage may be modified in connection with any
assignment made in accordance with the provisions of Section 9.6.
"Term Loan Committed Amount" shall have the meaning set forth in
Section 2.4(a).
"Term Loan Maturity Date" shall mean the earlier of (a) the date that is
six (6) years after the Closing Date and (b) to the extent applicable, the
Accelerated Maturity Date.
"Term Loan Note" or "Term Loan Notes" shall mean the promissory notes of
the Borrower (if any) made by the Borrower pursuant to Section 2.4(d) and
payable to the order of any of the Credit-Linked Lenders evidencing the Term
Loans provided by any such Credit-Linked Lender, individually or collectively,
as appropriate, as such promissory notes may be amended, modified, restated,
amended and restated, supplemented, extended, renewed or replaced from time to
time.
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"Trademark License" shall mean any agreement, whether written or oral,
providing for the grant by or to a Person of any right to use any Trademark,
including, without limitation, any thereof referred to in Schedule 3.16 to this
Credit Agreement.
"Trademarks" shall mean all trademarks, trade names, corporate names,
company names, business names, fictitious business names, service marks,
elements of package or trade dress of goods or services, logos and other source
or business identifiers, together with the goodwill associated therewith, now
existing or hereafter adopted or acquired, 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, including, without limitation, any thereof referred to in
Schedule 3.16 to this Credit Agreement, and (ii) all renewals thereof including,
without limitation, any thereof referred to in Schedule 3.16.
"Tranche" shall mean the collective reference to (a) LIBOR Rate Loans
whose Interest Periods begin and end on the same day and (b) Alternate Base Rate
Loans made on the same day. A Tranche with respect to LIBOR Rate Loans may
sometimes be referred to as a "Eurodollar Tranche".
"Transactions" shall mean the closing of this Credit Agreement and the
other Credit Documents and the consummation of the other transactions
contemplated hereby to occur in connection with such closing (including, without
limitation, the borrowing of the Term Loans and the payment of fees and expenses
in connection with all of the foregoing).
"Transfer Effective Date" shall have the meaning set forth in each
Commitment Transfer Supplement.
"Type" shall mean, as to any Loan, its nature as an Alternate Base Rate
Loan or LIBOR Rate Loan, as the case may be.
"UCC" shall mean the Uniform Commercial Code from time to time in effect
in any applicable jurisdiction.
"UCP" shall have the meaning set forth in Section 2.2(g).
"Unadjusted Senior Leverage Ratio" shall mean, as of any date of
determination, the ratio of (a) Senior Consolidated Funded Debt on such date
minus Performance Based Letters of Credit on such date to (b) Consolidated
EBITDAP minus Consolidated EBITDAP attributable to any real property sold during
the period of calculation minus Consolidated EBITDAP attributable to the Granite
Agreement for the fiscal year of the Borrower ended November 30, 2004 minus cash
dividends and distributions received by the Borrower and its Subsidiaries from
Permitted Joint Ventures during such period.
"Unreimbursed Drawing" shall have the meaning set forth in Section
2.5(d)(ii).
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"Voting Securities" shall mean any class of Capital Stock of a Person
pursuant to which the holders thereof have, at the time of determination, the
general voting power under ordinary circumstances to vote for the election of
directors, managers, trustees or general partners of such Person (irrespective
of whether or not at the time any other class or classes will have or might have
voting power by reason of the happening of any contingency).
"Wachovia" shall mean Wachovia Bank, National Association, a national
banking association, together with its successors and/or assigns.
"WCM" shall mean Wachovia Capital Markets, LLC, together with its
successors and assigns.
"Weighted Average Life to Maturity" shall mean, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding principal amount of such Indebtedness into (b) the total of the
product obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity in respect thereof by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment.
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS.
(a) Unless otherwise specified therein, all terms defined in this
Credit Agreement shall have the defined meanings when used in the Notes or
other Credit Documents or any certificate or other document made or
delivered pursuant hereto.
(b) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Credit Agreement shall refer to this
Credit Agreement as a whole and not to any particular provision of this
Credit Agreement, and Section, subsection, Schedule and Exhibit references
are to this Credit Agreement unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 1.3 ACCOUNTING TERMS.
Unless otherwise specified herein, all accounting terms 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 with the most recent audited
Consolidated financial statements of the Borrower delivered to the Lenders;
provided that, if the Borrower notifies the Administrative Agent that it wishes
to amend any covenant in Section 5.9 to eliminate the effect of any change in
GAAP on the operation of such covenant (or if the Administrative Agent notifies
the Borrower that the Required Lenders wish to amend Section 5.9 for such
purpose), then the Borrower's compliance with such covenant shall be determined
on the basis of GAAP in effect immediately before the relevant
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change in GAAP became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Borrower and the Required
Lenders.
The Borrower shall deliver to the Administrative Agent and each Lender at
the same time as the delivery of any annual or quarterly financial statements
given in accordance with the provisions of Section 5.1, (i) a description in
reasonable detail of any material change in the application of accounting
principles employed in the preparation of such financial statements from those
applied in the most recently preceding quarterly or annual financial statements
as to which no objection shall have been made in accordance with the provisions
above and (ii) a reasonable estimate of the effect on the financial statements
on account of such changes in application.
SECTION 1.4 TIME REFERENCES.
Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).
ARTICLE II
THE LOANS; AMOUNT AND TERMS
SECTION 2.1 REVOLVING LOANS.
(a) Revolving Commitment. During the Revolving Commitment Period,
subject to the terms and conditions hereof, each Revolving Lender
severally agrees to make revolving credit loans in Dollars ("Revolving
Loans") to the Borrower from time to time for the purposes hereinafter set
forth; provided, however, that (i) with regard to each Revolving Lender
individually, the sum of such Revolving Lender's Revolving Commitment
Percentage of the aggregate principal amount of outstanding Revolving
Loans plus outstanding Swingline Loans plus outstanding Revolving LOC
Obligations shall not exceed such Revolving Lender's Revolving Commitment
and (ii) with regard to the Revolving Lenders collectively, the sum of the
aggregate principal amount of outstanding Revolving Loans plus outstanding
Swingline Loans plus outstanding Revolving LOC Obligations shall not
exceed the Revolving Committed Amount then in effect. For purposes hereof,
the aggregate principal amount available for Revolving Loan borrowings
hereunder shall be EIGHTY MILLION DOLLARS ($80,000,000) (as such aggregate
maximum amount may be reduced from time to time as provided in Section
2.8, the "Revolving Committed Amount"). Revolving Loans may consist of
Alternate Base Rate Loans or LIBOR Rate Loans, or a combination thereof,
as the Borrower may request, and may be repaid and reborrowed in
accordance with the provisions hereof; provided, however, the Revolving
Loans made on the Closing Date or on either of the two (2) Business Days
immediately following the Closing Date may only consist of Alternate Base
Rate Loans. LIBOR Rate Loans shall be made by each Revolving Lender at its
LIBOR Lending Office and Alternate Base Rate Loans at its Domestic Lending
Office.
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(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower may request a Revolving
Loan borrowing by delivering a written Notice of Borrowing (or
telephone notice promptly confirmed in writing by delivery of a
written Notice of Borrowing, which delivery may be by fax) to the
Administrative Agent not later than 1:00 P.M. on the date of the
requested borrowing in the case of Alternate Base Rate Loans, and on
the third Business Day prior to the date of the requested borrowing
in the case of LIBOR Rate Loans. Each such Notice of Borrowing shall
be irrevocable and shall specify (A) that a Revolving Loan is
requested, (B) the date of the requested borrowing (which shall be a
Business Day), (C) the aggregate principal amount to be borrowed and
(D) whether the borrowing shall be comprised of Alternate Base Rate
Loans, LIBOR Rate Loans or a combination thereof, and if LIBOR Rate
Loans are requested, the Interest Period(s) therefor. If the
Borrower shall fail to specify in any such Notice of Borrowing (1)
an applicable Interest Period in the case of a LIBOR Rate Loan, then
such notice shall be deemed to be a request for an Interest Period
of one month, or (2) the Type of Revolving Loan requested, then such
notice shall be deemed to be a request for an Alternate Base Rate
Loan hereunder. The Administrative Agent shall give notice to each
Revolving Lender promptly upon receipt of each Notice of Borrowing,
the contents thereof and each such Revolving Lender's share thereof.
(ii) Minimum Amounts. Each Revolving Loan that is made as an
Alternate Base Rate Loan shall be in a minimum aggregate amount of
$1,000,000 and integral multiples of $100,000 in excess thereof (or
the remaining amount of the Revolving Committed Amount, if less).
Each Revolving Loan that is made as a LIBOR Rate Loan shall be in a
minimum aggregate amount of $2,000,000 and integral multiples of
$1,000,000 in excess thereof (or the remaining amount of the
Revolving Committed Amount, if less).
(iii) Advances. Each Revolving Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing available to
the Administrative Agent for the account of the Borrower at the
office of the Administrative Agent specified in Section 9.2, or at
such other office as the Administrative Agent may designate in
writing, by 3:00 P.M. (1:00 P.M. in the case of LIBOR Rate Loans) on
the date specified in the applicable Notice of Borrowing, in Dollars
and in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent on the date specified in the applicable Notice
of Borrowing (by the end of business Eastern Time on such date) by
crediting the account of the Borrower on the books of such office
with the aggregate of the amounts made available to the
Administrative Agent by the Revolving Lenders and in like funds as
received by the Administrative Agent.
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(c) Repayment. Subject to the terms of this Credit Agreement,
Revolving Loans may be borrowed, repaid and reborrowed during the
Revolving Commitment Period. The principal amount of all Revolving Loans
shall be due and payable in full on the Revolving Commitment Termination
Date.
(d) Interest. Subject to the provisions of Section 2.10(b),
Revolving Loans shall bear interest as follows:
(i) Alternate Base Rate Loans. During such periods as
Revolving Loans shall be comprised of Alternate Base Rate Loans,
each such Alternate Base Rate Loan shall bear interest at a per
annum rate equal to the sum of the Alternate Base Rate plus the
Applicable Percentage; and
(ii) LIBOR Rate Loans. During such periods as Revolving Loans
shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the
LIBOR Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each Interest
Payment Date.
(e) Revolving Notes. The Borrower's obligation to pay each Revolving
Lender's Revolving Loans shall be evidenced, upon such Revolving Lender's
request, by a Revolving Note made payable to such Revolving Lender in
substantially the form of Schedule 2.1(e).
SECTION 2.2 REVOLVING LETTER OF CREDIT SUBFACILITY.
(a) Issuance. Subject to the terms and conditions hereof and of the
LOC Documents, if any, and any other terms and conditions which the
Revolving Issuing Lender may reasonably require, during the Revolving
Commitment Period the Revolving Issuing Lender shall issue, and the
Revolving Lenders shall participate in, standby Revolving Letters of
Credit for the account of the Borrower from time to time upon request in a
form acceptable to the Revolving Issuing Lender; provided, however, that
(i) the aggregate amount of Revolving LOC Obligations shall not at any
time exceed FIFTY MILLION DOLLARS ($50,000,000) (the "Revolving LOC
Committed Amount"), (ii) with regard to each Revolving Lender
individually, the sum of such Revolving Lender's Revolving Commitment
Percentage of the aggregate principal amount of outstanding Revolving
Loans plus outstanding Swingline Loans plus outstanding Revolving LOC
Obligations shall not exceed such Revolving Lender's Revolving Commitment,
(iii) with regard to the Revolving Lenders collectively, the sum of the
aggregate principal amount of outstanding Revolving Loans plus outstanding
Swingline Loans plus outstanding Revolving LOC Obligations shall not
exceed the Revolving Committed Amount then in effect, (iv) all Revolving
Letters of Credit shall be denominated in Dollars and (v) Revolving
Letters of Credit may be issued for any lawful corporate purposes,
including in connection with workers' compensation and other insurance
programs. Except as otherwise expressly agreed upon by all the Revolving
39
Lenders, no Revolving Letter of Credit shall have an original expiry date
more than twelve (12) months from the date of issuance; provided, however,
so long as no Default or Event of Default has occurred and is continuing
and subject to the other terms and conditions to the issuance of Revolving
Letters of Credit hereunder, the expiry dates of Revolving Letters of
Credit may be extended annually or periodically from time to time on the
request of the Borrower or by operation of the terms of the applicable
Revolving Letter of Credit to a date not more than twelve (12) months from
the date of extension; provided, further, that no Revolving Letter of
Credit, as originally issued or as extended, shall have an expiry date
extending beyond the date that is ten (10) days prior to the Revolving
Commitment Termination Date. Each Revolving Letter of Credit shall comply
with the related LOC Documents. The issuance and expiry date of each
Revolving Letter of Credit shall be a Business Day. Any Revolving Letter
of Credit issued hereunder shall be in a minimum original face amount of
$100,000 or such lesser amount as approved by the Revolving Issuing
Lender.
(b) Notice and Reports. The request for the issuance of a Revolving
Letter of Credit shall be submitted to the Revolving Issuing Lender and
the Administrative Agent at least three (3) Business Days prior to the
requested date of issuance. The Revolving Issuing Lender will promptly
upon request provide to the Administrative Agent for dissemination to the
Revolving Lenders a detailed report specifying the Revolving Letters of
Credit which are then issued and outstanding and any activity with respect
thereto which may have occurred since the date of any prior report, and
including therein, among other things, the account party, the beneficiary,
the face amount, expiry date as well as any payments or expirations which
may have occurred. The Revolving Issuing Lender will further provide to
the Administrative Agent promptly upon request copies of the Revolving
Letters of Credit.
(c) Participations. Each Revolving Lender, upon issuance of any
Revolving Letter of Credit (or upon a Person becoming a Revolving Lender
hereunder), shall be deemed to have purchased, without recourse to the
Revolving Issuing Lender, and the Revolving Issuing Lender shall be deemed
to have granted without recourse to the Revolving Issuing Lender, a risk
participation from the Revolving Issuing Lender in such Revolving Letter
of Credit and the obligations arising thereunder and any collateral
relating thereto, in each case in an amount equal to its Revolving
Commitment Percentage of the maximum amounts available to be drawn under
such Revolving Letter of Credit and shall absolutely, unconditionally and
irrevocably assume, as primary obligor and not as surety, and be obligated
to pay to the Revolving Issuing Lender therefor and discharge when due,
its Revolving Participation Interest by paying its Revolving Commitment
Percentage of the amounts drawn under such Revolving Letter of Credit.
Without limiting the scope and nature of each Revolving Lender's
participation in any Revolving Letter of Credit, to the extent that the
Revolving Issuing Lender has not been reimbursed as required hereunder or
under any LOC Document, each such Revolving Lender shall fund its
Revolving Participation Interest therein by paying to the Revolving
Issuing Lender its Revolving Commitment Percentage of such unreimbursed
drawing in same day funds on the day of notification by the Revolving
Issuing Lender of an unreimbursed drawing pursuant to and in accordance
with the
40
provisions of subsection (d) hereof. The obligation of each Revolving
Lender to so pay the Revolving Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a Default, an
Event of Default or any other occurrence or event. Any such payment shall
not relieve or otherwise impair the obligation of the Borrower to
reimburse the Revolving Issuing Lender under any Revolving Letter of
Credit, together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Revolving
Letter of Credit, the Revolving Issuing Lender will promptly notify the
Borrower and the Administrative Agent. The Borrower shall reimburse the
Revolving Issuing Lender on the day of drawing under any Revolving Letter
of Credit (either with the proceeds of a Revolving Loan obtained hereunder
or otherwise) in same day funds as provided herein or in the LOC Documents
if the Borrower shall have been given notice of such drawing by 12:00 Noon
and otherwise on the next Business Day after such drawing if the Borrower
shall have been given notice of such drawing after 12:00 Noon. If the
Borrower shall be given notice of a drawing by 12:00 Noon and shall fail
to reimburse the Revolving Issuing Lender on the same date of such notice,
the unreimbursed amount of such drawing shall bear interest from the date
of notice until payment in full at a per annum rate equal to the ABR
Default Rate. If the Borrower shall be given notice of a drawing after
12:00 Noon, the unreimbursed amount of such drawing shall bear interest
from the date of notice until the next Business Day at a per annum rate
equal to the Alternate Base Rate plus the Applicable Percentage and if the
Borrower shall fail to reimburse the Revolving Issuing Lender on such next
Business Day, the unreimbursed amount of such drawing shall bear interest
from the Business Day succeeding the date of notice until payment in full
at a per annum rate equal to the ABR Default Rate. Unless the Borrower
shall immediately notify the Revolving Issuing Lender and the
Administrative Agent of its intent to otherwise reimburse the Revolving
Issuing Lender, the Borrower shall be deemed to have requested a Mandatory
LOC Borrowing in the amount of the drawing as provided in subsection (d)
hereof, the proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower's reimbursement obligations hereunder shall be
absolute and unconditional under all circumstances irrespective of any
rights of set-off, counterclaim or defense to payment the Borrower may
claim or have against the Revolving Issuing Lender, the Administrative
Agent, the Lenders, the beneficiary of the Revolving Letter of Credit
drawn upon or any other Person, including without limitation any defense
based on any failure of the Borrower to receive consideration or the
legality, validity, regularity or unenforceability of the Revolving Letter
of Credit; provided that the Borrower shall not be deemed to have waived
any claims it may have against the Revolving Issuing Lender, the
Administrative Agent, the Lenders, the beneficiary of the Revolving Letter
of Credit drawn upon or any other Person and may separately pursue such
claims after payment of such reimbursement obligations. The Revolving
Issuing Lender will promptly notify the Administrative Agent (which shall
promptly notify the Revolving Lenders) of the amount of any unreimbursed
drawing and each Revolving Lender shall promptly fund its Revolving
Participation Interest therein by paying to the Administrative Agent for
the account of the Revolving Issuing Lender, in Dollars and in immediately
available funds, the amount of such Revolving Lender's Revolving
Commitment Percentage of such
41
unreimbursed drawing. Such payment shall be made on the day such notice is
received by such Revolving Lender from the Revolving Issuing Lender if
such notice is received at or before 2:00 P.M., otherwise such payment
shall be made at or before 12:00 Noon on the Business Day next succeeding
the day such notice is received. If such Revolving Lender does not pay
such amount to the Revolving Issuing Lender in full upon such request,
such Revolving Lender shall, on demand, pay to the Administrative Agent
for the account of the Revolving Issuing Lender interest on the unpaid
amount during the period from the date of such drawing until such
Revolving Lender pays such amount to the Revolving Issuing Lender in full
at a rate per annum equal to, if paid within two (2) Business Days of the
date of drawing, the Federal Funds Effective Rate and thereafter at a rate
equal to the Alternate Base Rate. Each Revolving Lender's obligation to
make such payment to the Revolving Issuing Lender, and the right of the
Revolving Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and
without regard to the termination of this Credit Agreement or the
Commitments hereunder, the existence of a Default or Event of Default or
the acceleration of the Credit Party Obligations hereunder and shall be
made without any offset, abatement, withholding or reduction whatsoever.
(e) Repayment with Revolving Loans. On any day on which the Borrower
shall have requested, or been deemed to have requested, a Revolving Loan
to reimburse a drawing under a Revolving Letter of Credit, the
Administrative Agent shall give notice to the Revolving Lenders that a
Revolving Loan has been requested or deemed requested in connection with a
drawing under a Revolving Letter of Credit, in which case a Revolving Loan
borrowing comprised entirely of Alternate Base Rate Loans (each such
borrowing, a "Mandatory LOC Borrowing") shall be made (without giving
effect to any termination of the Commitments pursuant to Section 7.2) pro
rata based on each Revolving Lender's respective Revolving Commitment
Percentage (determined before giving effect to any termination of the
Commitments pursuant to Section 7.2) and the proceeds thereof shall be
paid directly to the Revolving Issuing Lender for application to the
respective Revolving LOC Obligations. Each Revolving Lender hereby
irrevocably agrees to make such Revolving Loans on the day such notice is
received by the Revolving Lenders from the Administrative Agent if such
notice is received at or before 2:00 P.M., otherwise such payment shall be
made at or before 12:00 Noon on the Business Day next succeeding the day
such notice is received, in each case notwithstanding (i) the amount of
Mandatory LOC Borrowing may not comply with the minimum amount for
borrowings of Revolving Loans otherwise required hereunder, (ii) whether
any conditions specified in Section 4.2 are then satisfied, (iii) whether
a Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time
otherwise required in Section 2.1(b), (v) the date of such Mandatory LOC
Borrowing, or (vi) any reduction in the Revolving Committed Amount after
any such Revolving Letter of Credit may have been drawn upon. In the event
that any Mandatory LOC Borrowing cannot for any reason be made on the date
otherwise required above (including, without limitation, as a result of
the occurrence of a Bankruptcy Event), then each such Revolving Lender
hereby agrees that it shall forthwith fund (as of the date the Mandatory
LOC Borrowing would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such
purchase) its Revolving Participation
42
Interests in the outstanding Revolving LOC Obligations; provided, further,
that in the event any Revolving Lender shall fail to fund its Revolving
Participation Interest on the day the Mandatory LOC Borrowing would
otherwise have occurred, then the amount of such Revolving Lender's
unfunded Revolving Participation Interest therein shall bear interest
payable by such Revolving Lender to the Revolving Issuing Lender upon
demand, at the rate equal to, if paid within two (2) Business Days of such
date, the Federal Funds Effective Rate, and thereafter at a rate equal to
the Alternate Base Rate.
(f) Modification, Extension. The issuance of any supplement,
modification, amendment, renewal, or extension to any Revolving Letter of
Credit shall, for purposes hereof, be treated in all respects the same as
the issuance of a new Revolving Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Revolving Issuing Lender
shall have the Letters of Credit be subject to The Uniform Customs and
Practice for Documentary Credits, as published as of the date of issue by
the International Chamber of Commerce (the "UCP"), in which case the UCP
may be incorporated therein and deemed in all respects to be a part
thereof.
(h) Designation of Subsidiaries as Account Parties. Notwithstanding
anything to the contrary set forth in this Agreement, a Revolving Letter
of Credit issued hereunder may contain a statement to the effect that such
Revolving Letter of Credit is issued for the account of a Subsidiary of
the Borrower; provided that, notwithstanding such statement, the Borrower
shall be the actual account party for all purposes of this Agreement for
such Revolving Letter of Credit and such statement shall not affect the
Borrower's reimbursement obligations hereunder with respect to such
Revolving Letter of Credit.
SECTION 2.3 SWINGLINE LOAN SUBFACILITY.
(a) Swingline Commitment. During the Revolving Commitment Period,
subject to the terms and conditions hereof, the Swingline Lender, in its
individual capacity, agrees to make certain revolving credit loans to the
Borrower (each a "Swingline Loan" and, collectively, the "Swingline
Loans") for the purposes hereinafter set forth; provided, however, (i) the
aggregate amount of Swingline Loans outstanding at any time shall not
exceed FIFTEEN MILLION DOLLARS ($15,000,000) (the "Swingline Committed
Amount"), and (ii) the sum of the aggregate principal amount of
outstanding Revolving Loans plus outstanding Swingline Loans plus
outstanding Revolving LOC Obligations shall not exceed the Revolving
Committed Amount. Swingline Loans hereunder may be repaid and reborrowed
in accordance with the provisions hereof.
(b) Swingline Loan Borrowings.
(i) Notice of Borrowing and Disbursement. The Swingline Lender
will make Swingline Loans available to the Borrower on any Business
Day upon delivery of a Notice of Borrowing by the Borrower to the
Administrative Agent
43
not later than 2:00 P.M. on such Business Day. Swingline Loan
borrowings hereunder shall be made in minimum amounts of $100,000
and in integral amounts of $100,000 in excess thereof. Such
borrowing will then be made available to the Borrower by the
Swingline Lender on the date specified in the applicable Notice of
Borrowing (by the end of business Eastern Time on such date) by
crediting the account of the Borrower on the books of such office
with the aggregate of the amounts made available to the
Administrative Agent by the Swingline Lender and in like funds as
received by the Administrative Agent.
(ii) Repayment of Swingline Loans. Each Swingline Loan
borrowing shall be due and payable on the Revolving Commitment
Termination Date. The Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Administrative
Agent, demand repayment of its Swingline Loans by way of a Revolving
Loan borrowing, in which case the Borrower shall be deemed to have
requested a Revolving Loan borrowing comprised entirely of Alternate
Base Rate Loans in the amount of such Swingline Loans; provided,
however, that in the following circumstances, any such demand shall
also be deemed to have been given one Business Day prior to each of
(1) the Revolving Commitment Termination Date, (2) the occurrence of
any Bankruptcy Event, (3) upon acceleration of the Credit Party
Obligations hereunder, whether on account of a Bankruptcy Event or
any other Event of Default, and (4) the exercise of remedies in
accordance with the provisions of Section 7.2 hereof (each such
Revolving Loan borrowing made on account of any such deemed request
therefor as provided herein being hereinafter referred to as
"Mandatory Swingline Borrowing"). Each Revolving Lender hereby
irrevocably agrees to make such Revolving Loans promptly upon any
such request or deemed request on account of each Mandatory
Swingline Borrowing in the amount and in the manner specified in the
preceding sentence and on the same such date notwithstanding (I) the
amount of the Mandatory Swingline Borrowing may not comply with the
minimum amount for borrowings of Revolving Loans otherwise required
hereunder, (II) whether any conditions specified in Section 4.2 are
then satisfied, (III) whether a Default or an Event of Default then
exists, (IV) failure of any such request or deemed request for
Revolving Loans to be made by the time otherwise required in Section
2.1(b)(i), (V) the date of such Mandatory Swingline Borrowing, or
(VI) any reduction in the Revolving Committed Amount or termination
of the Revolving Commitments immediately prior to such Mandatory
Swingline Borrowing or contemporaneously therewith. In the event
that any Mandatory Swingline Borrowing cannot for any reason be made
on the date otherwise required above (including, without limitation,
as a result of the commencement of a proceeding under the Bankruptcy
Code), then each Revolving Lender hereby agrees that it shall
forthwith purchase (as of the date the Mandatory Swingline Borrowing
would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such
purchase) from the Swingline Lender such participations in the
outstanding Swingline Loans as shall be necessary to cause each such
Revolving Lender to share in such Swingline Loans ratably based upon
its respective Revolving
44
Commitment Percentage (determined before giving effect to any
termination of the Commitments pursuant to Section 7.2); provided
that (x) all interest payable on the Swingline Loans shall be for
the account of the Swingline Lender until the date as of which the
respective participation is purchased, and (y) at the time any
purchase of participations pursuant to this sentence is actually
made, the purchasing Revolving Lender shall be required to pay to
the Swingline Lender interest on the principal amount of such
participation purchased for each day from and including the day upon
which the Mandatory Swingline Borrowing would otherwise have
occurred to but excluding the date of payment for such
participation, at the rate equal to, if paid within two (2) Business
Days of the date of the Mandatory Swingline Borrowing, the Federal
Funds Effective Rate, and thereafter at a rate equal to the
Alternate Base Rate.
(c) Interest on Swingline Loans. Subject to the provisions of
Section 2.11(b), Swingline Loans shall bear interest at a per annum rate
equal to the Alternate Base Rate plus the Applicable Percentage for
Revolving Loans that are Alternate Base Rate Loans. Interest on Swingline
Loans shall be payable in arrears on each Interest Payment Date.
(d) Swingline Note. The Swingline Loans shall be evidenced by a duly
executed promissory note of the Borrower to the Swingline Lender in the
original amount of the Swingline Committed Amount and substantially in the
form of Schedule 2.3(d).
SECTION 2.4 CREDIT-LINKED FACILITY--TERM LOAN SUBFACILITY.
(a) Initial Term Loan. Subject to the terms and conditions hereof
and in reliance upon the representations and warranties set forth herein,
each Credit-Linked Lender severally agrees to make available to the
Administrative Agent on the Closing Date such Credit-Linked Lender's
Credit-Linked Commitment Percentage of Term Loans in Dollars in the
aggregate principal amount of TWENTY-FIVE MILLION DOLLARS ($25,000,000)
(as such amount may be increased by any Credit-Linked Purchase that is
converted to Term Loans pursuant to Section 2.5(d)(ii), the "Term Loan
Committed Amount") for the purposes hereinafter set forth; provided,
however, (i) with regard to each Credit-Linked Lender individually, the
sum of such Credit-Linked Lender's Credit-Linked Commitment Percentage of
the aggregate principal amount of the outstanding Term Loans plus
outstanding Credit-Linked LOC Obligations shall not at any time exceed
such Credit-Linked Lender's Credit-Linked Commitment and (ii) with regard
to the Credit-Linked Lenders collectively, the sum of the aggregate
principal amount of the outstanding Term Loans plus outstanding
Credit-Linked LOC Obligations shall not at any time exceed the
Credit-Linked Committed Amount then in effect. Upon receipt by the
Administrative Agent of the proceeds of the Term Loan made on the Closing
Date, such proceeds will then be made available to the Borrower by the
Administrative Agent by crediting the account of the Borrower on the books
of the office of the Administrative Agent specified in Section 9.2, or at
such other office as the Administrative Agent may designate in writing,
with the aggregate of such proceeds made available to the Administrative
Agent by the Credit-Linked Lenders and in like funds as received by the
Administrative Agent (or by crediting such other account(s) as
45
directed by the Borrower). Each Term Loan may consist of Alternate Base
Rate Loans or LIBOR Rate Loans, or a combination thereof, as the Borrower
may request. Amounts repaid or prepaid on any Term Loan may not be
reborrowed. LIBOR Rate Loans shall be made by each Credit-Linked Lender at
its LIBOR Lending Office and Alternate Base Rate Loans at its Domestic
Lending Office.
(b) Repayment of Term Loans. The principal amount of the Term Loans
shall be repaid in twenty-four (24) consecutive calendar quarterly
installments as follows, unless accelerated sooner pursuant to Section
7.2:
Principal Amortization Payment Dates Term Loan Principal Amortization Payment
------------------------------------ ----------------------------------------
February 28, 2005 $250,000
May 31, 2005 $250,000
August 31, 2005 $250,000
November 30, 2005 $250,000
February 28, 2006 $250,000
May 31, 2006 $250,000
August 31, 2006 $250,000
November 30, 2006 $250,000
February 28, 2007 $250,000
May 31, 2007 $250,000
August 31, 2007 $250,000
November 30, 2007 $250,000
February 28, 2008 $250,000
May 31, 2008 $250,000
August 31, 2008 $250,000
November 30, 2008 $250,000
February 28, 2009 $250,000
May 31, 2009 $250,000
August 31, 2009 $250,000
November 30, 2009 $250,000
February 28, 2010 $250,000
May 31, 2010 $250,000
August 31, 2010 $250,000
Credit-Linked Maturity Date Remaining principal amount of Term Loans
The outstanding principal amount of the Term Loans and all accrued but
unpaid interest and other amounts payable with respect to the Term Loans
shall be repaid on the Credit-Linked Maturity Date.
(c) Interest on the Term Loans. Subject to the provisions of Section
2.11, the Term Loan shall bear interest as follows:
46
(i) Alternate Base Rate Loans. During such periods as the Term
Loans shall be comprised of Alternate Base Rate Loans, each such
Alternate Base Rate Loan shall bear interest at a per annum rate
equal to the sum of the Alternate Base Rate plus the Applicable
Percentage; and
(ii) LIBOR Rate Loans. During such periods as the Term Loans
shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the
LIBOR Rate plus the Applicable Percentage.
Interest on the Term Loans shall be payable in arrears on each
Interest Payment Date.
(d) Term Loan Notes. The Borrower's obligation to pay each
Credit-Linked Lender's portion of the Term Loans shall be evidenced, upon
such Credit-Linked Lender's request, by a Term Loan Note made payable to
such Credit-Linked Lender in substantially the form of Schedule 2.4(d).
SECTION 2.5 CREDIT-LINKED FACILITY - LETTER OF CREDIT SUBFACILITY.
(a) Issuance. Subject to the terms and conditions hereof and of the
LOC Documents, if any, and any other terms and conditions which the
Credit-Linked Issuing Lender may reasonably require, during the
Credit-Linked Commitment Period the Credit-Linked Issuing Lender shall
issue, and the Credit-Linked Lenders shall participate in, standby
Credit-Linked Letters of Credit for the account of the Borrower from time
to time upon request in a form acceptable to the Credit-Linked Issuing
Lender; provided, however, that (i) the aggregate amount of Credit-Linked
LOC Obligations shall not at any time exceed the lesser of (A)
SEVENTY-FIVE MILLION DOLLARS ($75,000,000) (as reduced from time to time
in accordance with the terms of Section 2.5(d)(ii) or Section 2.8(a), the
"Credit-Linked LOC Committed Amount") and (B) the principal amount of the
Credit-Linked Deposit, (ii) with regard to each Credit-Linked Lender
individually, (A) the sum of such Credit-Linked Lender's Credit-Linked
Commitment Percentage of the outstanding Credit-Linked LOC Obligations
shall not exceed such Credit-Linked Lender's Credit-Linked Deposit and (B)
the sum of such Credit-Linked Lender's Credit-Linked Commitment Percentage
of the aggregate principal amount of the outstanding Term Loans plus
outstanding Credit-Linked LOC Obligations shall not at any time exceed
such Credit-Linked Lender's Credit-Linked Commitment, (iii) with regard to
the Credit-Linked Lenders collectively, the sum of the aggregate principal
amount of outstanding Term Loans plus outstanding Credit-Linked LOC
Obligations shall not at any time exceed the Credit-Linked Committed
Amount then in effect, (iv) no Credit-Linked Letter of Credit may be
issued without the Administrative Agent confirming in writing to any
Credit-Linked Issuing Lender (other than the Administrative Agent in its
capacity as a Credit-Linked Issuing Lender) that, after giving effect to
the issuance of such Credit-Linked Letter of Credit, the requirement set
forth in clause (iii) above shall be satisfied, (v) all Credit-Linked
Letters of Credit shall be denominated in Dollars and (vi) Credit-Linked
Letters of Credit shall be issued for any lawful corporate
47
purposes, including in connection with workers' compensation and other
insurance programs. Except as otherwise expressly agreed upon by all the
Credit-Linked Lenders, no Credit-Linked Letter of Credit shall have an
original expiry date more than twelve (12) months from the date of
issuance; provided, however, the expiry dates of Credit-Linked Letters of
Credit may be extended annually or periodically from time to time at the
request of the Borrower or by operation of the terms of the applicable
Letter of Credit to a date not more than twelve (12) months from the date
of extension; provided, further, that (x) no Credit-Linked Letter of
Credit, as originally issued or as extended, shall have an expiry date
extending beyond the date that is ten (10) days prior to the Credit-Linked
Maturity Date and (y) if an Event of Default exists at the time such
Credit-Linked Letter of Credit is to be extended, the Credit-Linked
Issuing Lender may or, at the direction of Credit-Linked Lenders holding
more than 50% of the Credit-Linked Commitments, the Credit-Linked Issuing
Lender shall refuse to extend such Credit-Linked Letter of Credit, in
which case such Credit-Linked Letter of Credit shall terminate at the end
of the current term thereof. Each Credit-Linked Letter of Credit shall
comply with the related LOC Documents. The issuance and expiry date of
each Credit-Linked Letter of Credit shall be a Business Day. Any
Credit-Linked Letters of Credit issued hereunder shall be in a minimum
original face amount of $100,000 or such lesser amount as approved by the
Credit-Linked Issuing Lender.
(b) Notice and Reports. The request for the issuance of a
Credit-Linked Letter of Credit shall be submitted to the Credit-Linked
Issuing Lender and the Administrative Agent at least three (3) Business
Days prior to the requested date of issuance. The Credit-Linked Issuing
Lender will promptly upon request provide to the Administrative Agent for
dissemination to the Credit-Linked Lenders a detailed report specifying
the Credit-Linked Letters of Credit which are then issued by such
Credit-Linked Issuing Lender and outstanding and any activity with respect
thereto which may have occurred since the date of any prior report, and
including therein, among other things, the account party, the beneficiary,
the face amount, expiry date as well as any payments or expirations which
may have occurred. The Credit-Linked Issuing Lender will further provide
to the Administrative Agent promptly upon request copies of the
Credit-Linked Letters of Credit.
(c) Participations. Each Credit-Linked Lender, upon issuance of any
Credit-Linked Letter of Credit (or upon a Person becoming a Credit-Linked
Lender hereunder) and, in the case of each Existing Letter of Credit, on
the Closing Date, shall be deemed to have irrevocably purchased, without
recourse to the Credit-Linked Issuing Lender, and the Credit-Linked
Issuing Lender shall be deemed to have irrevocably granted without
recourse to the Credit-Linked Issuing Lender, a risk participation (a
"Credit-Linked Participation") from the Credit-Linked Issuing Lender in
such Credit-Linked Letter of Credit and the obligations arising thereunder
and any collateral relating thereto, in each case in an amount equal to
its Credit-Linked Commitment Percentage of the maximum amounts available
to be drawn under such Credit-Linked Letter of Credit and shall
absolutely, unconditionally and irrevocably assume, as primary obligor and
not as surety, and be obligated to pay to the Credit-Linked Issuing Lender
therefor and discharge when due, its Credit-Linked Commitment Percentage
of the obligations arising under such
48
Credit-Linked Letter of Credit. Without limiting the scope and nature of
each Credit-Linked Lender's participation in any Credit-Linked Letter of
Credit, to the extent that the Credit-Linked Issuing Lender has not been
reimbursed as required hereunder or under any LOC Document, each such
Credit-Linked Lender shall fund its Credit-Linked Participation Interest
therein by paying to the Credit-Linked Issuing Lender, from funds
deposited by such Credit-Linked Lender into the Credit-Linked Deposit, its
Credit-Linked Commitment Percentage of such unreimbursed drawing in same
day funds on the day of notification by the Credit-Linked Issuing Lender
of an unreimbursed drawing pursuant to and in accordance with the
provisions of subsection (d) hereof. The obligation of each Credit-Linked
Lender to so pay the Credit-Linked Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a Default, an
Event of Default or any other occurrence or event.
(d) Reimbursement; Funding of Participation Interests.
(i) Reimbursement by Borrower. In the event of any drawing
under any Credit-Linked Letter of Credit, the Credit-Linked Issuing
Lender will promptly notify the Borrower and the Administrative
Agent. If a drawing under a Credit-Linked Letter of Credit is in
excess of $15,000,000, the Borrower shall be deemed to have
requested a Credit-Linked Purchase in the amount of such drawing as
provided in subsection (d)(ii) below, the proceeds of which shall be
used to satisfy the reimbursement obligations. If a drawing under a
Credit-Linked Letter of Credit is less than $15,000,000, the
Borrower shall reimburse the Credit-Linked Issuing Lender on the day
of such drawing (either with the proceeds of a Revolving Loan
obtained hereunder or otherwise) in same day funds as provided
herein or in the LOC Documents if the Borrower shall have been given
notice of such drawing by 12:00 Noon and otherwise on the next
Business Day after such drawing if the Borrower shall have been
given notice of such drawing after 12:00 Noon. If the Borrower shall
be given notice of a drawing by 12:00 Noon and shall fail to
reimburse the Credit-Linked Issuing Lender on the same date of such
notice, the unreimbursed amount of such drawing shall bear interest
from the date of notice until the first to occur of (A) the
reimbursement of such drawing or (B) the conversion of such
Unreimbursed Drawing to a Term Loan pursuant to subsection (d)(ii)
below at a per annum rate equal to the ABR Default Rate. If the
Borrower shall be given notice of a drawing after 12:00 Noon, the
unreimbursed amount of such drawing shall bear interest from the
date of notice until the next Business Day at a per annum rate equal
to the Alternate Base Rate plus the Applicable Percentage and if the
Borrower shall fail to reimburse the Credit-Linked Issuing Lender on
such next Business Day, the unreimbursed amount of such drawing
shall bear interest from the Business Day succeeding the date of
notice until the first to occur of (A) the reimbursement of such
drawing or (B) the conversion of such Unreimbursed Drawing to a Term
Loan pursuant to subsection (d)(ii) below at a per annum rate equal
to the ABR Default Rate. Unless the Borrower shall promptly notify
the Credit-Linked Issuing Lender and the Administrative Agent of its
intent to otherwise reimburse the Credit-Linked Issuing Lender after
receipt by the Borrower of notice of a drawing, the Borrower
49
shall be deemed to have requested a Credit-Linked Purchase in the
amount of such drawing as provided in subsection (d)(ii) below, the
proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower's reimbursement obligations hereunder
shall be absolute and unconditional under all circumstances
irrespective of any rights of set-off, counterclaim or defense to
payment the Borrower may claim or have against the Credit-Linked
Issuing Lender, the Administrative Agent, the Lenders, the
beneficiary of the Credit-Linked Letter of Credit drawn upon or any
other Person, including without limitation any defense based on any
failure of the Borrower to receive consideration or the legality,
validity, regularity or unenforceability of the Credit-Linked Letter
of Credit; provided that the Borrower shall not be deemed to have
waived any claims it may have against the Credit-Linked Issuing
Lender, the Administrative Agent, the Lenders, the beneficiary of
the Credit-Linked Letter of Credit drawn upon or any other Person
and may separately pursue such claims after payment of such
reimbursement obligations.
(ii) Funding of Participation Interests by Credit-Linked
Lenders; Conversion to Term Loans. After any drawing under any
Credit-Linked Letter of Credit and upon the earlier of (A) the
failure of the Borrower to reimburse such drawing in accordance with
the terms of subsection (d)(i) hereof, (B) receipt by the
Credit-Linked Issuing Lender of notice from the Borrower that it
will not exercise its right to reimburse such drawing and (C) the
occurrence or continuation of a Default or an Event of Default, (1)
in order to fund its Credit-Linked Participation Interest in such
unreimbursed drawing (an "Unreimbursed Drawing"), each Credit-Linked
Lender hereby authorizes the Administrative Agent to pay the
Credit-Linked Issuing Lender (such payment, a "Credit-Linked
Purchase") in the amount of such Credit-Linked Lender's
Credit-Linked Commitment Percentage of such Unreimbursed Drawing,
solely from such Credit-Linked Lender's Credit-Linked Deposit, and
such Credit-Linked Lender hereby irrevocably authorizes the
Administrative Agent to charge the Credit-Linked Account for such
purpose, (2) the Credit-Linked LOC Committed Amount shall be
automatically reduced by the amount of each Credit-Linked Purchase
and shall not be reinstated, (3) such Unreimbursed Drawing shall be
automatically converted to a funded Term Loan consisting of an
Alternate Base Rate Loan without any further act by the Borrower,
the Credit-Linked Issuing Lender, the Administrative Agent or any
Credit-Linked Lender, which Term Loan shall be subject to the terms
and conditions of Section 2.4 and (4) the Term Loan Committed Amount
shall be automatically permanently increased by the amount of each
Credit-Linked Purchase. The Credit-Linked Issuing Lender will
promptly notify the Administrative Agent (which shall notify the
Credit-Linked Lenders) of the amount of any Unreimbursed Drawing.
Each Credit-Linked Lender's obligation to fund its Credit-Linked
Participation Interest in any Unreimbursed Drawing by paying to the
Credit-Linked Issuing Lender its Credit-Linked Commitment Percentage
of any Unreimbursed Drawing, and the right of the Credit-Linked
Issuing Lender to receive the same, shall be absolute and
unconditional, shall be made without any offset, abatement,
withholding or
50
reduction whatsoever and shall not be affected by any circumstance
whatsoever and without regard to (I) whether any conditions
specified in Section 4.2 are then satisfied, (II) whether a Default
or an Event of Default then exists, (III) the date of such
Credit-Linked Purchase and Term Loan, (IV) any reduction in the
Credit-Linked Committed Amount after any such Credit-Linked Letter
of Credit may have been drawn upon, (V) the termination of this
Credit Agreement or the Commitments hereunder or (VI) the
acceleration of the Credit Party Obligations hereunder.
(e) Repayment of Participations.
(i) At any time after the Credit-Linked Issuing Lender has
made a payment under any Credit-Linked Letter of Credit and has
received from the Credit-Linked Account the proceeds of
Credit-Linked Purchases by the Credit-Linked Lenders in respect of
such payment in accordance with Section 2.5(d) (which Credit-Linked
Purchases have been converted to Term Loans in accordance with such
Section), if the Administrative Agent receives for the account of
the Credit-Linked Issuing Lender any payment in respect of the
related Unreimbursed Drawing or interest thereon for any period
after such Unreimbursed Drawing was paid with a Credit-Linked
Purchase, the Administrative Agent will distribute to such
Credit-Linked Lender its Term Loan Commitment Percentage thereof. If
the Credit-Linked Issuing Lender shall have received from the
Credit-Linked Account the proceeds of Credit-Linked Purchases by the
Credit-Linked Lenders and thereafter shall receive any direct
payment from the Borrower in respect of the Unreimbursed Drawing
with respect to which such Credit-Linked Purchases were made, the
Credit-Linked Issuing Lender shall immediately pay the amount
received to the Administrative Agent for distribution to the
Credit-Linked Lenders in accordance with this Section 2.5(e).
(ii) If any payment received by the Administrative Agent for
the account of the Credit-Linked Issuing Lender pursuant to Section
2.5(e)(i) and distributed to the Credit-Linked Lenders by the
Administrative Agent is required to be returned under any
circumstance (including pursuant to any settlement entered into by
the Credit-Linked Issuing Lender), each Credit-Linked Lender shall
pay to the Administrative Agent for the account of the Credit-Linked
Issuing Lender its Credit-Linked Commitment Percentage thereof on
demand of the Administrative Agent, plus interest thereon from the
date of such demand to the date such amount is returned by such
Credit-Linked Lender, at a rate per annum equal to the Federal Funds
Rate from time to time in effect.
(f) Modification, Extension. The issuance of any supplement,
modification, amendment, renewal, or extension to any Credit-Linked Letter
of Credit shall, for purposes hereof, be treated in all respects the same
as the issuance of a new Credit-Linked Letter of Credit hereunder.
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(g) Uniform Customs and Practices. The Credit-Linked Issuing Lender
shall have the Letters of Credit be subject to The Uniform Customs and
Practice for Documentary Credits, as published as of the date of issue by
the UCP in which case the UCP may be incorporated therein and deemed in
all respects to be a part thereof.
(h) Designation of Subsidiaries as Account Parties. Notwithstanding
anything to the contrary set forth in this Agreement, a Credit-Linked
Letter of Credit issued hereunder may contain a statement to the effect
that such Credit-Linked Letter of Credit is issued for the account of a
Subsidiary of the Borrower; provided that, notwithstanding such statement,
the Borrower shall be the actual account party and borrower for all
purposes of this Agreement for such Credit-Linked Letter of Credit and any
Credit-Linked Purchase and Term Loan with respect to an Unreimbursed
Drawing thereunder and such statement shall not affect the Borrower's
reimbursement obligations hereunder with respect to such Credit-Linked
Letter of Credit and its repayment obligations hereunder with respect to
such Term Loan.
(i) Existing Letters of Credit. Each Existing Letter of Credit shall
be deemed for all purposes of this Agreement and the other Credit
Documents to be a Credit-Linked Letter of Credit. The Borrower's
reimbursement obligations in respect of each Existing Letter of Credit,
and each Credit-Linked Lender's Participation Interests therein, shall be
governed by the terms of this Credit Agreement.
(j) Credit-Linked Note. The Borrower's reimbursement obligations
with respect to the Credit-Linked Letters of Credit issued pursuant to
this Section 2.5 shall be evidenced by a Credit-Linked Note made payable
to the Credit-Linked Issuing Lender in substantially the form of Schedule
2.5(j).
SECTION 2.6 CREDIT-LINKED DEPOSITS.
(a) Funding of Credit-Linked Deposits. Subject to the terms and
conditions set forth herein and in consideration of each Credit-Linked
Lender's Credit-Linked Participation, each Credit-Linked Lender severally
agrees to fund such Lender's Credit-Linked Deposit to the Administrative
Agent in Dollars on the Closing Date in an amount equal to its
Credit-Linked Commitment for deposit by the Administrative Agent in the
Credit-Linked Account. Each Credit-Linked Lender's Credit-Linked Deposit
represents such Lender's funded Credit-Linked Participation.
(b) Purpose of Credit-Linked Deposits. The Credit-Linked Deposits
will be held by the Administrative Agent in its name in the Credit-Linked
Account, on behalf of the Credit-Linked Lenders and for the benefit of the
Credit-Linked Issuing Lender. The Credit-Linked Account will be under the
sole dominion and control of the Administrative Agent and no Person other
than the Administrative Agent shall have the right of withdrawal from the
Credit-Linked Account nor any other right or power with respect to the
Credit-Linked Deposits or the Credit-Linked Account. Unless returned to
the Credit-Linked Lenders, the Credit-Linked Deposits shall not be used
for any purpose other than
52
funding the Credit-Linked Participations in the Credit-Linked Letters of
Credit without the prior written consent of each Credit-Linked Issuing
Lender.
(c) Actions of Administrative Agent. In charging the Credit-Linked
Account or otherwise exercising any rights of set-off with respect
thereto, the Administrative Agent acts as the agent of the Credit-Linked
Issuing Lender.
(d) Grant of Security Interest in Credit-Linked Account. The
Administrative Agent hereby grants, and the Credit-Linked Lenders hereby
grant and hereby authorize the Administrative Agent to grant, to the
Credit-Linked Issuing Lender, a security interest in and Lien on the
Credit-Linked Account, the Credit-Linked Deposits and all cash, Cash
Equivalents or other amounts or investments from time to time in the
Credit-Linked Account. The foregoing security interest and Lien shall
secure the obligations of the Credit-Linked Lenders to fund their
Credit-Linked Participation Interests in any Unreimbursed Drawing by
paying the Credit-Linked Issuing Lender for such Unreimbursed Drawing.
Each of the Administrative Agent and the Credit-Linked Lenders agree to
execute such agreements and documents and take such actions as may be
reasonably required by the Credit-Linked Issuing Lender to perfect and
protect the foregoing security interest and Lien.
(e) Investment of Credit-Linked Deposits. Pending the use of the
Credit-Linked Deposits to fund the Credit-Linked Lenders' Credit-Linked
Participation Interests in Unreimbursed Drawings under the Credit-Linked
Letters of Credit, the Administrative Agent will invest such Credit-Linked
Deposits and will pay to Credit-Linked Lenders in arrears on the last
Business Day of each calendar quarter any return on such investment during
the previous calendar quarter up to an amount not to exceed LIBOR as of
the last Business Day of such previous calendar quarter.
(f) Reduction of Credit-Linked Deposit. If any Credit-Linked
Purchase is made with proceeds of the Credit-Linked Deposits, the
Credit-Linked Deposits shall be automatically permanently reduced by the
amount of such Credit-Linked Purchase. If the Borrower elects to reduce
the Credit-Linked LOC Committed Amount pursuant to Section 2.8(a), the
Credit-Linked Deposit shall be automatically permanently reduced by a
corresponding amount and the amount of such reduction shall be returned to
the Credit-Linked Lenders on a pro rata basis by the Administrative Agent.
SECTION 2.7 FEES.
(a) Revolving Commitment Fee. In consideration of the Revolving
Commitments, the Borrower agrees to pay to the Administrative Agent, for
the ratable benefit of the Revolving Lenders, a commitment fee (the
"Revolving Commitment Fee") in an amount equal to 0.50% per annum on the
average daily unused amount of the Revolving Committed Amount. For
purposes of computation of the Revolving Commitment Fee, Revolving LOC
Obligations shall be considered usage but Swingline Loans shall not be
considered usage of the Revolving Committed Amount.
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(b) Credit-Linked Subfacility Fee. In consideration of the
Credit-Linked LOC Commitment and the Credit-Linked Participations, the
Borrower agrees to pay to the Administrative Agent, for the ratable
benefit of the Credit-Linked Lenders, a subfacility fee (the
"Credit-Linked Subfacility Fee") in an amount equal to 3.00% plus the
Shortfall Amount per annum on the average daily Credit-Linked LOC
Committed Amount. The Credit-Linked Subfacility Fee shall be payable at
the end of each LIBOR period used to determine the Shortfall Amount.
(c) Revolving LOC Fees. In consideration of the Revolving LOC
Commitments, the Borrower agrees to pay to the Administrative Agent, for
the ratable benefit of the Revolving Lenders, a fee (the "Revolving LOC
Commitment Fee") equal to the Applicable Percentage for Revolving Loans
that are LIBOR Rate Loans per annum on the average daily maximum amount
available to be drawn under each Revolving Letter of Credit from the date
of issuance to the date of expiration. In addition to such Revolving LOC
Commitment Fee, the Borrower agrees to pay to the Revolving Issuing
Lender, for its own account without sharing by the Revolving Lenders, an
additional fronting fee (the "Revolving LOC Fronting Fee") of one-quarter
of one percent (0.25%) per annum on the average daily maximum amount
available to be drawn under each Revolving Letter of Credit issued by it.
(d) Credit-Linked LOC Fronting Fees. The Borrower agrees to pay to
the Credit-Linked Issuing Lender, for its own account without sharing by
the Credit-Linked Lenders, a fronting fee (the "Credit-Linked LOC Fronting
Fee") of one-tenth of one percent (0.10%) per annum on the average daily
maximum amount available to be drawn under each Credit-Linked Letter of
Credit (other than an Existing Letter of Credit) issued by it. The
Credit-Linked LOC Fronting Fee shall be payable at the time of issuance
and of renewal of the applicable Credit-Linked Letter of Credit.
(e) Issuing Lender Fees. In addition to the Revolving LOC Fronting
Fees and the Credit-Linked LOC Fronting Fees payable pursuant to this
Section, the Borrower shall pay to the Issuing Lender for its own account
without sharing by the other Lenders the reasonable and customary charges
from time to time of the Issuing Lender with respect to the amendment,
transfer, administration, cancellation and conversion of, and drawings
under, the Letters of Credit (collectively, the "Issuing Lender Fees").
(f) Administrative Fee. The Borrower agrees to pay to the
Administrative Agent the annual administrative fee as described in the Fee
Letter.
(g) Payment of Fees. The Revolving Commitment Fees, Revolving LOC
Commitment Fees, Revolving LOC Fronting Fees and Issuing Lender Fees shall
each be payable quarterly in arrears on the last Business Day of each
calendar quarter.
SECTION 2.8 COMMITMENT REDUCTIONS.
(a) Voluntary Reductions. The Borrower shall have the right to
terminate or permanently reduce the unused portion of the Revolving
Committed Amount and the
54
Credit-Linked LOC Committed Amount at any time or from time to time upon
not less than five (5) Business Days' prior written notice to the
Administrative Agent (which shall notify the Lenders thereof as soon as
practicable) of each such termination or reduction, which notice shall
specify the effective date thereof and the amount of any such reduction
which shall be in a minimum amount of $2,000,000 or a whole multiple of
$1,000,000 in excess thereof and shall be irrevocable and effective upon
receipt by the Administrative Agent; provided that (i) no such reduction
or termination of the Revolving Committed Amount shall be permitted if
after giving effect thereto, and to any prepayments of the Revolving Loans
made on the effective date thereof, the sum of the aggregate principal
amount of outstanding Revolving Loans plus outstanding Swingline Loans
plus outstanding Revolving LOC Obligations would exceed the Revolving
Committed Amount then in effect and (ii) no such reduction or termination
of the Credit-Linked LOC Committed Amount shall be permitted if after
giving effect thereto, the outstanding Credit-Linked LOC Obligations would
exceed the Credit-Linked LOC Committed Amount then in effect or the
Credit-Linked Deposits at such time.
(b) Maturity Date. The Revolving Commitments, the LOC Commitments
and the Swingline Commitment shall automatically terminate on the
Revolving Commitment Termination Date. The Term Loan Commitment and the
Credit-Linked LOC Commitment shall automatically terminate on the
Credit-Linked Maturity Date.
SECTION 2.9 PREPAYMENTS.
(a) Optional Prepayments. The Borrower shall have the right to
prepay the Revolving Loans and the Term Loans in whole or in part from
time to time as the Borrower may elect; provided, however, that (i) each
partial prepayment of Term Loans shall be in a minimum principal amount of
$1,000,000 and integral multiples of $100,000 in excess thereof and (ii)
each voluntary prepayment of the Term Loan shall be applied to the
remaining amortization payments thereof on a pro rata basis. The Borrower
shall give at least three (3) Business Days' (but not more than five (5)
Business Days') irrevocable notice in the case of LIBOR Rate Loans and at
least one (1) Business Day's (but not more than five (5) Business Days')
irrevocable notice in the case of Alternate Base Rate Loans, to the
Administrative Agent (which shall notify the Lenders thereof as soon as
practicable). Subject to the foregoing terms, amounts prepaid under this
Section 2.9(a) shall be applied first to Alternate Base Rate Loans and
then to LIBOR Rate Loans in direct order of Interest Period maturities.
All prepayments under this Section 2.9(a) shall be subject to Section
2.18, but otherwise without premium or penalty. Interest on the principal
amount prepaid shall be due and payable on any date that a prepayment is
made hereunder through the date of prepayment.
(b) Mandatory Prepayments.
(i) (A) Revolving Committed Amount. If at any time after the
Closing Date, the sum of the aggregate principal amount of
outstanding Revolving Loans plus outstanding Swingline Loans plus
outstanding Revolving LOC Obligations shall exceed the Revolving
Committed Amount then in effect,
55
the Borrower immediately shall prepay the Revolving Loans and
Swingline Loans and (after all Revolving Loans and Swingline Loans
have been repaid) cash collateralize the Revolving LOC Obligations
in an amount sufficient to eliminate such excess.
(B) Credit-Linked LOC Committed Amount. If at any time
after the Closing Date, the aggregate amount of Credit-Linked
LOC Obligations shall exceed the lesser of (1) the
Credit-Linked LOC Committed Amount and (2) the principal
amount of the Credit-Linked Deposit, the Borrower immediately
shall cash collateralize the Credit-Linked LOC Obligations in
the amount of such excess.
(ii) Excess Cash Flow. Within one hundred ten (110) days after
the end of each fiscal year (commencing with the fiscal year ending
November 30, 2005), the Borrower shall prepay the Loans in an amount
equal to 50% of the Excess Cash Flow earned during such prior fiscal
year. Any payments of Excess Cash Flow shall be applied as set forth
in clause (viii) below.
(iii) Asset Dispositions. Promptly following any Asset
Disposition (or related series of Asset Dispositions), the Borrower
shall prepay the Loans in an aggregate amount equal to the Net Cash
Proceeds derived from such Asset Disposition (or related series of
Asset Dispositions) (such prepayment to be applied as set forth in
clause (viii) below); provided that (A) the Net Cash Proceeds from
Asset Dispositions in any fiscal year shall not be required to be so
applied until the aggregate amount of such Net Cash Proceeds is
equal to or greater than $1,000,000 for such fiscal year, (B) the
Borrower shall be permitted to reinvest up to $10,000,000 of Net
Cash Proceeds received from Asset Dispositions in the aggregate in
fixed or capital assets so long as (1) no Default or Event of
Default shall have occurred and be continuing at the time of such
Asset Disposition and at the time of such reinvestment, (2) before
or promptly after such Asset Disposition, the Borrower delivers to
the Administrative Agent a certificate stating that such Net Cash
Proceeds will be reinvested in accordance with the terms of this
Section 2.8(b)(iii) and (3) such reinvestments occurs within 365
days of the receipt of such Net Cash Proceeds, and (C) with respect
to any Permitted Real Estate Sale, the Borrower shall not be
required to prepay Loans with the Net Cash Proceeds from such
Permitted Real Estate Sale to the extent the Loan to Value Test is
satisfied after giving effect to such Permitted Real Estate Sale.
(iv) Debt Issuances. Promptly, upon receipt by any Credit
Party or any of its Subsidiaries of proceeds from any Debt Issuance,
the Borrower shall prepay the Loans in an aggregate amount equal to
100% of the Net Cash Proceeds of such Debt Issuance (such prepayment
to be applied as set forth in clause (viii) below).
(v) Issuances of Equity. Promptly, upon receipt by any Credit
Party or any of its Subsidiaries of proceeds from any Equity
Issuance, the Borrower shall
56
prepay the Loans in an aggregate amount equal to 50% of the Net Cash
Proceeds of such Equity Issuance (such prepayment to be applied as
set forth in clause (viii) below).
(vi) Recovery Event. To the extent Net Cash Proceeds received
in connection with any Recovery Event are not used to acquire fixed
or capital assets in replacement of the assets subject to such
Recovery Event within 365 days of the receipt of such Net Cash
Proceeds, immediately following the 365th day occurring after the
receipt of such Net Cash Proceeds, the Borrower shall prepay the
Loans in an aggregate amount equal to 100% of such Net Cash Proceeds
(such prepayment to be applied as set forth in clause (vii) below);
provided that (A) the Net Cash Proceeds from Recovery Events in any
fiscal year shall not be required to be so applied until the
aggregate amount of such Net Cash Proceeds is equal to or greater
than $1,000,000 for such fiscal year, (B) after the occurrence and
during the continuation of a Default, any Net Cash Proceeds shall be
delivered to the Administrative Agent in escrow until the earlier of
(I) the cure of such Default at which time the Net Cash Proceeds
shall be used by the Borrower as set forth herein and (II) the
occurrence of an Event of Default at which time the Net Cash
Proceeds shall be used to prepay the Loans as set forth herein and
(C) after the occurrence and during the continuance of an Event of
Default, any Net Cash Proceeds received in connection with any
Recovery Event shall be promptly used to prepay the Loans (such
prepayment to be applied as set forth in clause (viii) below) and
the Borrower and its Subsidiaries shall not have the right to
reinvest such Net Cash Proceeds.
(vii) Litigation Award. To the extent Net Cash Proceeds
received in connection with any Litigation Award are not reinvested
in the business of the Credit Parties within 365 days of the receipt
of such Net Cash Proceeds, immediately following the 365th day
occurring after the receipt of such Net Cash Proceeds, the Borrower
shall prepay the Loans in an aggregate amount equal to one 100% of
such Net Cash Proceeds (such prepayment to be applied as set forth
in clause (viii) below); provided that (A) the Net Cash Proceeds
from any Litigation Award in any fiscal year shall not be required
to be so applied until the aggregate amount of such Net Cash
Proceeds is equal to or greater than $1,000,000 for such fiscal
year, (B) after the occurrence and during the continuation of a
Default, any Net Cash Proceeds shall be delivered to the
Administrative Agent in escrow until the earlier of (I) the cure of
such Default at which time the Net Cash Proceeds shall be used by
the Borrower as set forth herein and (II) the occurrence of an Event
of Default at which time the Net Cash Proceeds shall be used to
prepay the Loans as set forth herein and (C) after the occurrence
and during the continuance of an Event of Default, any Net Cash
Proceeds received in connection with any Litigation Award shall be
promptly used to prepay the Loans (such prepayment to be applied as
set forth in clause (viii) below) and the Borrower and its
Subsidiaries shall not have the right to reinvest such Net Cash
Proceeds.
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(viii) Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.9(b) shall be applied
as follows:
(A) with respect to all amounts prepaid pursuant to
Section 2.9(b)(i), (1) first to the outstanding Swingline
Loans, (2) second to the outstanding Revolving Loans and (3)
third to a cash collateral account in respect of Revolving LOC
Obligations; and
(B) with respect to all amounts prepaid pursuant to
Sections 2.9(b)(ii) through (vii), (1) first to the Term Loans
(pro rata to the remaining amortization payments set forth in
Section 2.4(b)); provided that, so long as there are Swingline
Loans, Revolving Loans or Revolving Letters of Credit
outstanding, any Credit-Linked Lender may decline to accept
any such prepayment (collectively, the "Declined Amount"), in
which case the Declined Amount shall first be distributed to
the Credit-Linked Lenders accepting prepayments made pursuant
to this clause (B)(1) (and applied pro rata to the remaining
amortization payments relating thereto) and then to the
outstanding Swingline Loans, Revolving Loans and Revolving LOC
Obligations in accordance with the remainder of this Section
2.8(b)(viii)(B), (2) second to outstanding Swingline Loans
(without a corresponding permanent reduction in the Revolving
Committed Amount), (3) third to the outstanding Revolving
Loans (without a corresponding permanent reduction in the
Revolving Committed Amount) and (4) fourth any remaining
amounts shall be paid to the Borrower. Within the parameters
of the applications set forth above, prepayments shall be
applied first to Alternate Base Rate Loans and then to LIBOR
Rate Loans in direct order of Interest Period maturities. All
prepayments under this Section 2.9(b) shall be subject to
Section 2.18 and be accompanied by interest on the principal
amount prepaid through the date of prepayment.
(c) Hedging Obligations Unaffected. Any repayment or prepayment made
pursuant to this Section 2.9 shall not affect the Borrower's obligation to
continue to make payments under any Secured Hedging Agreement, which shall
remain in full force and effect notwithstanding such repayment or
prepayment, subject to the terms of such Secured Hedging Agreement.
SECTION 2.10 DEFAULT RATE AND PAYMENT DATES.
(a) If all or a portion of the principal amount of any Loan which is
a LIBOR Rate Loan shall not be paid when due or continued as a LIBOR Rate
Loan in accordance with the provisions of Section 2.11 (whether at the
stated maturity, by acceleration or otherwise), such overdue principal
amount of such Loan shall be converted to an Alternate Base Rate Loan at
the end of the Interest Period applicable thereto.
58
(b) Upon the occurrence, and during the continuance, of an Event of
Default, at the election of the Required Lenders, the principal of and, to
the extent permitted by law, interest on the Loans and any other amounts
owing hereunder or under the other Credit Documents shall bear interest,
payable on demand (and monthly if demand is not made), at a per annum rate
2% greater than the rate which would otherwise be applicable (or if no
rate is applicable, whether in respect of interest, fees or other amounts,
then the ABR Default Rate).
(c) Interest on each Loan shall be payable in arrears on each
Interest Payment Date; provided that interest accruing pursuant to Section
2.10(b) shall be payable from time to time on demand.
SECTION 2.11 CONVERSION OPTIONS.
(a) The Borrower may, in the case of Revolving Loans and the Term
Loans, elect from time to time to convert Alternate Base Rate Loans to
LIBOR Rate Loans by giving the Administrative Agent at least three (3)
Business Days' prior irrevocable written notice of such election, such
notice to be in substantially the form of the notice of conversion
attached hereto as Schedule 2.11 (a "Notice of Conversion"). In addition,
the Borrower may elect from time to time to convert LIBOR Rate Loans to
Alternate Base Rate Loans by delivering an irrevocable Notice of
Conversion to the Administrative Agent by 1:00 P.M. one Business Date
prior to the proposed date of conversion. If the date upon which an
Alternate Base Rate Loan is to be converted to a LIBOR Rate Loan is not a
Business Day, then such conversion shall be made on the next succeeding
Business Day. All or any part of outstanding Alternate Base Rate Loans may
be converted as provided herein; provided that (i) no Loan may be
converted into a LIBOR Rate Loan when any Default or Event of Default has
occurred and is continuing and (ii) partial conversions shall be in an
aggregate principal amount of $2,000,000 or a whole multiple of $1,000,000
in excess thereof. LIBOR Rate Loans may only be converted to Alternate
Base Rate Loans on the last day of the applicable Interest Period. If the
date upon which a LIBOR Rate Loan is to be converted to an Alternate Base
Rate Loan is not a Business Day, then such conversion shall be made on the
next succeeding Business Day and during the period from such last day of
an Interest Period to such succeeding Business Day such Loan shall bear
interest as if it were an Alternate Base Rate Loan.
(b) Any LIBOR Rate Loans may be continued as such upon the
expiration of an Interest Period with respect thereto by compliance by the
Borrower with the notice provisions contained in Section 2.12(a);
provided, that no LIBOR Rate Loan may be continued as such when any
Default or Event of Default has occurred and is continuing, in which case
such Loan shall be automatically converted to an Alternate Base Rate Loan
at the end of the applicable Interest Period with respect thereto. If the
Borrower shall fail to give timely notice of an election to continue a
LIBOR Rate Loan, or the continuation of LIBOR Rate Loans is not permitted
hereunder, such LIBOR Rate Loans shall be automatically converted to
Alternate Base Rate Loans at the end of the applicable Interest Period
with respect thereto.
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SECTION 2.12 COMPUTATION OF INTEREST AND FEES.
(a) Interest payable hereunder with respect to any Alternate Base
Rate Loan based on the Prime Rate shall be calculated on the basis of a
year of 365 days (or 366 days, as applicable) for the actual days elapsed.
All fees, interest and all other amounts payable hereunder shall be
calculated on the basis of a 360 day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and
the Lenders of each determination of a LIBOR Rate on the Business Day of
the determination thereof. Any change in the interest rate on a Loan
resulting from a change in the Alternate Base Rate shall become effective
as of the opening of business on the day on which such change in the
Alternate Base Rate shall become effective. The Administrative Agent shall
as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each such change.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Credit Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error. The Administrative Agent shall, at the request of the
Borrower, deliver to the Borrower a statement showing the computations
used by the Administrative Agent in determining any interest rate.
(c) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Credit Parties are hereby limited by the provisions of this paragraph
which shall override and control all such agreements, whether now existing
or hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including but not limited to prepayment or
acceleration of the maturity of any Obligation), shall the interest taken,
reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious
amount permissible under applicable law. If, from any possible
construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this
paragraph and such interest shall be automatically reduced to the maximum
nonusurious amount permitted under applicable law, without the necessity
of execution of any amendment or new document. If any Lender shall ever
receive anything of value which is characterized as interest on the Loans
under applicable law and which would, apart from this provision, be in
excess of the maximum nonusurious amount, an amount equal to the amount
which would have been excessive interest shall, without penalty, be
applied to the reduction of the principal amount owing on the Loans and
not to the payment of interest, or refunded to the Borrower or the other
payor thereof if and to the extent such amount which would have been
excessive exceeds such unpaid principal amount of the Loans. The right to
demand payment of the Loans or any other Indebtedness evidenced by any of
the Credit Documents does not include the right to receive any interest
which has not otherwise accrued on the date of such demand, and the
Lenders do not intend to charge or receive any unearned interest in the
event of such demand. All interest paid or agreed to be paid to the
Lenders with respect to the Loans shall, to the extent permitted by
applicable law,
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be amortized, prorated, allocated, and spread throughout the full stated
term (including any renewal or extension) of the Loans so that the amount
of interest on account of such indebtedness does not exceed the maximum
nonusurious amount permitted by applicable law.
SECTION 2.13 PRO RATA TREATMENT AND PAYMENTS.
(a) Allocation of Payments Before Exercise of Remedies. Each
borrowing of Revolving Loans and any reduction of the Revolving
Commitments shall be made pro rata according to the respective Revolving
Commitment Percentages of the Revolving Lenders. Each borrowing of a Term
Loan by conversion of a Credit-Linked LOC Advance to a Term Loan and any
reduction of the Credit-Linked Commitments shall be made pro rata
according to the respective Credit-Linked Commitment Percentages of the
Credit-Linked Lenders. Unless otherwise indicated herein, each payment
under this Credit Agreement or any Note shall be applied, first, to any
fees then due and owing by the Borrower pursuant to Section 2.7, second,
to interest then due and owing hereunder and under the Notes and, third,
to principal then due and owing hereunder and under the Notes. Each
payment on account of any fees pursuant to Section 2.7 shall be made pro
rata in accordance with the respective amounts due and owing (except as to
the Revolving LOC Fronting Fees, the Credit-Linked LOC Fronting Fees and
the Issuing Lender Fees, which fees shall be for the account of the
applicable Issuing Lender). Each voluntary prepayment on account of
principal of the Loans shall be applied in accordance with the terms of
Section 2.9(a). Each mandatory prepayment on account of principal of the
Loans shall be applied in accordance with Section 2.9(b). All payments
(including prepayments) to be made by the Borrower on account of
principal, interest and fees shall be made without defense, set-off or
counterclaim (except as provided in Section 2.19(b)) and shall be made to
the Administrative Agent for the account of the Lenders, the Issuing
Lenders or the Swingline Lender, as the case may be, at the Administrative
Agent's office specified on Section 9.2 in Dollars and in immediately
available funds not later than 1:00 P.M. on the date when due. The
Administrative Agent shall distribute such payments to the Lenders
entitled thereto promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the LIBOR Rate Loans) becomes
due and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day, and, with respect to
payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. If any payment on a LIBOR Rate Loan
becomes due and payable on a day other than a Business Day, the maturity
thereof shall be extended to the next succeeding Business Day unless the
result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the
immediately preceding Business Day.
(b) Allocation of Payments After Exercise of Remedies.
Notwithstanding any other provisions of this Agreement to the contrary,
after the exercise of remedies (other than the invocation of default
interest pursuant to Section 2.10(b)) by the Administrative Agent or the
Lenders pursuant to Section 7.2 (or after the Commitments shall
automatically terminate and the Loans (with accrued interest thereon) and
all other
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amounts under the Credit Documents shall automatically become due and
payable in accordance with the terms of such Section), all amounts
collected or received by the Administrative Agent or any Lender on account
of the Credit Party Obligations or in respect of the Collateral shall be
paid over or delivered as follows (irrespective of whether the following
costs, expenses, fees, interest, premiums, scheduled periodic payments or
Credit Party Obligations are allowed, permitted or recognized as a claim
in any proceeding resulting from the occurrence of a Bankruptcy Event):
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys'
fees) of the Administrative Agent and the Issuing Lenders in
connection with enforcing the rights of the Lenders under the Credit
Documents and any protective advances made by the Administrative
Agent with respect to the Collateral under or pursuant to the terms
of the Security Documents;
SECOND, to the payment of any fees owed to the Administrative
Agent and the Issuing Lenders;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents or otherwise enforcing its rights with
respect to the Credit Party Obligations owing to such Lender;
FOURTH, to the payment of all of the Credit Party Obligations
consisting of accrued fees and interest, including, with respect to
any Secured Hedging Agreement, any fees, premiums and scheduled
periodic payments due under such Secured Hedging Agreement and any
interest accrued thereon;
FIFTH, to the payment of the outstanding principal amount of
the Credit Party Obligations, including the payment or cash
collateralization of the outstanding LOC Obligations and, with
respect to any Secured Hedging Agreement, any breakage, termination
or other payments due under such Secured Hedging Agreement and any
interest accrued thereon;
SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied
in the numerical order provided until exhausted prior to application to
the next succeeding category; (ii) each of the Secured Parties shall
receive an amount equal to its pro rata share (based on the proportion
that the then outstanding Loans and LOC Obligations held
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by such Lender or the outstanding obligations payable to such Hedging
Agreement Provider bears to the aggregate then outstanding Loans, LOC
Obligations and obligations payable under all Secured Hedging Agreements)
of amounts available to be applied pursuant to clauses "THIRD", "FOURTH",
"FIFTH" AND "SIXTH" above; and (iii) to the extent that any amounts
available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of
Credit, such amounts shall be held by the Administrative Agent in a cash
collateral account and applied to reimburse the Issuing Lender from time
to time for any drawings under such Letters of Credit. Notwithstanding the
foregoing terms of this Section 2.13(b), only Collateral proceeds and
payments under the Guaranty with respect to Secured Hedging Agreements (as
opposed to ordinary course principal, interest and fee payments hereunder)
shall be applied to obligations under any Secured Hedging Agreement.
SECTION 2.14 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT.
(a) Unless the Administrative Agent shall have been notified in
writing by a Lender prior to the date a Loan is to be made by such Lender
(which notice shall be effective upon receipt) that such Lender does not
intend to make the proceeds of such Loan available to the Administrative
Agent, the Administrative Agent may assume that such Lender has made such
proceeds available to the Administrative Agent on such date, and the
Administrative Agent may in reliance upon such assumption (but shall not
be required to) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent will promptly notify the Borrower, and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to
recover from the Lender or the Borrower, as the case may be, interest on
such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered by the
Administrative Agent at a per annum rate equal to (i) from the Borrower at
the applicable rate for the applicable borrowing pursuant to the Notice of
Borrowing and (ii) from a Lender at the Federal Effective Funds Rate.
(b) Unless the Administrative Agent shall have been notified in
writing by the Borrower, prior to the date on which any payment is due
from it hereunder (which notice shall be effective upon receipt) that the
Borrower does not intend to make such payment, the Administrative Agent
may assume that such Borrower has made such payment when due, and the
Administrative Agent may in reliance upon such assumption (but shall not
be required to) make available to each Lender on such payment date an
amount equal to the portion of such assumed payment to which such Lender
is entitled hereunder, and if the Borrower has not in fact made such
payment to the Administrative Agent, such Lender shall, on demand, repay
to the Administrative Agent the amount made available to such Lender. If
such amount is repaid to the Administrative Agent on a date after the date
such amount was made available to such Lender, such Lender shall pay to
the
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Administrative Agent on demand interest on such amount in respect of each
day from the date such amount was made available by the Administrative
Agent to such Lender to the date such amount is recovered by the
Administrative Agent at a per annum rate equal to the Federal Funds
Effective Rate.
(c) A certificate of the Administrative Agent submitted to the
Borrower or any Lender with respect to any amount owing under this Section
2.14 shall be conclusive in the absence of manifest error.
SECTION 2.15 INABILITY TO DETERMINE INTEREST RATE.
Notwithstanding any other provision of this Credit Agreement, if (i) the
Administrative Agent shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that, by reason of circumstances
affecting the relevant market, reasonable and adequate means do not exist for
ascertaining LIBOR for such Interest Period, or (ii) the Required Lenders shall
reasonably determine (which determination shall be conclusive and binding absent
manifest error) that the LIBOR Rate does not adequately and fairly reflect the
cost to such Lenders of funding LIBOR Rate Loans that the Borrower has requested
be outstanding as a LIBOR Tranche during such Interest Period, the
Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least
two (2) Business Days prior to the first day of such Interest Period. Unless the
Borrower shall have notified the Administrative Agent upon receipt of such
telephone notice that it wishes to rescind or modify its request regarding such
LIBOR Rate Loans, any Loans that were requested to be made as LIBOR Rate Loans
shall be made as Alternate Base Rate Loans and any Loans that were requested to
be converted into or continued as LIBOR Rate Loans shall remain as or be
converted into Alternate Base Rate Loans. Until any such notice has been
withdrawn by the Administrative Agent, no further Loans shall be made as,
continued as, or converted into, LIBOR Rate Loans for the Interest Periods so
affected.
SECTION 2.16 ILLEGALITY.
Notwithstanding any other provision of this Credit Agreement, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by the relevant Governmental Authority to any Lender shall
make it unlawful for such Lender or its LIBOR Lending Office to make or maintain
LIBOR Rate Loans as contemplated by this Credit Agreement or to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make such Loans, (a) such Lender shall promptly notify the
Administrative Agent and the Borrower thereof, (b) the commitment of such Lender
hereunder to make LIBOR Rate Loans or continue LIBOR Rate Loans as such shall
forthwith be suspended until the Administrative Agent shall give notice that the
condition or situation which gave rise to the suspension shall no longer exist,
and (c) such Lender's Loans then outstanding as LIBOR Rate Loans, if any, shall
be converted on the last day of the Interest Period for such Loans or within
such earlier period as required by law as Alternate Base Rate Loans. The
Borrower hereby agrees promptly to pay any Lender, upon its demand, any
additional amounts necessary to compensate such Lender for actual and direct
costs (but not including anticipated profits) reasonably incurred by such Lender
in making any repayment in accordance with this Section
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including, but not limited to, any interest or fees payable by such Lender to
lenders of funds obtained by it in order to make or maintain its LIBOR Rate
Loans hereunder. A certificate as to any additional amounts payable pursuant to
this Section submitted by such Lender, through the Administrative Agent, to the
Borrower shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change its
LIBOR Lending Office) to avoid or to minimize any amounts which may otherwise be
payable pursuant to this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender in its sole discretion to be material.
SECTION 2.17 REQUIREMENTS OF LAW.
(a) If the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Lender with
any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date
hereof:
(i) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit, any participation
therein or any application relating thereto, any LIBOR Rate Loan
made by it, or change the basis of taxation of payments to such
Lender in respect thereof (except for tax on the overall net income
of such Lender and changes in the rate of such tax);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against
assets held by, deposits or other liabilities in or for the account
of, advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the LIBOR Rate hereunder;
or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such
Lender of making or maintaining LIBOR Rate Loans or the Letters of Credit
or the participations therein or to reduce any amount receivable hereunder
or under any Note, then, in any such case, the Borrower shall promptly pay
such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such additional cost or reduced amount
receivable which such Lender reasonably deems to be material as determined
by such Lender with respect to its LIBOR Rate Loans or Letters of Credit.
A certificate as to any additional amounts payable pursuant to this
Section submitted by such Lender, through the Administrative Agent, to the
Borrower shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change
its Domestic Lending Office or LIBOR Lending Office, as the case may be)
to avoid or to minimize any amounts which might otherwise be payable
pursuant to this paragraph of this Section; provided, however, that such
efforts shall not cause the imposition on such Lender of any additional
costs or legal or regulatory burdens deemed by such Lender to be material.
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(b) If any Lender shall have reasonably determined that the adoption
of or any change in any Requirement of Law regarding capital adequacy or
in the interpretation or application thereof or compliance by such Lender
or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from
any central bank or Governmental Authority made subsequent to the date
hereof does or shall have the effect of reducing the rate of return on
such Lender's or such corporation's capital as a consequence of its
obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount reasonably deemed
by such Lender to be material, then from time to time, within fifteen (15)
days after demand by such Lender, the Borrower shall pay to such Lender
such additional amount as shall be certified by such Lender as being
required to compensate it for such reduction. Such a certificate as to any
additional amounts payable under this Section submitted by a Lender (which
certificate shall include a description of the basis for the computation),
through the Administrative Agent, to the Borrower shall be conclusive
absent manifest error.
(c) The agreements in this Section 2.17 shall survive the
termination of this Credit Agreement and payment of the Notes and all
other amounts payable hereunder.
SECTION 2.18 INDEMNITY.
The Borrower hereby agrees to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) the failure by the Borrower to pay the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) the failure of the Borrower to accept a borrowing after
the Borrower has given a notice in accordance with the terms hereof, (c) the
failure of the Borrower to make any prepayment after the Borrower has given a
notice in accordance with the terms hereof, and/or (d) the making by the
Borrower of a prepayment of a Loan, or the conversion thereof, on a day which is
not the last day of the Interest Period with respect thereto, in each case
including, but not limited to, any such loss or expense arising from interest or
fees payable by such Lender to lenders of funds obtained by it in order to
maintain its Loans hereunder. A certificate as to any additional amounts payable
pursuant to this Section submitted by any Lender, through the Administrative
Agent, to the Borrower (which certificate must be delivered to the
Administrative Agent within thirty (90) days following such default, prepayment
or conversion and shall be conclusive in the absence of manifest error);
provided that if such certificate is not be delivered to the Administrative
Agent within ninety (90) days following such Lender becoming aware of such
default, prepayment or conversion, such Lender shall only be entitled to receive
payment pursuant to this Section with respect to losses or expenses incurred by
such Lender during the ninety (90) days prior to the date such Lender delivers
such certificate to the Administrative Agent. The agreements in this Section
shall survive termination of this Credit Agreement and payment in full of the
Credit Party Obligations.
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SECTION 2.19 TAXES.
(a) All payments made by the Borrower hereunder or under any Note
will be, except as provided in Section 2.19(b), made free and clear of,
and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever
nature now or hereafter imposed by any Governmental Authority or by any
political subdivision or taxing authority thereof or therein with respect
to such payments (but excluding any tax imposed on or measured by the net
income or profits of a Lender pursuant to the laws of the jurisdiction in
which it is organized or the jurisdiction in which the principal office or
applicable lending office of such Lender is located or any subdivision
thereof or therein) and all interest, penalties or similar liabilities
with respect thereto (all such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges being referred to collectively
as "Taxes"). If any Taxes on payments made by the Borrower hereunder are
so levied or imposed, the Borrower agrees to pay the full amount of such
Taxes, and such additional amounts as may be necessary so that every
payment of all amounts due under this Credit Agreement or under any Note,
after withholding or deduction for or on account of any Taxes, will not be
less than the amount provided for herein or in such Note. The Borrower
will furnish to the Administrative Agent as soon as practicable after the
date the payment of any Taxes is due pursuant to applicable law certified
copies (to the extent reasonably available and required by law) of tax
receipts evidencing such payment by the Borrower. The Borrower agrees to
indemnify and hold harmless each Lender, and reimburse such Lender upon
its written request, for the amount of any Taxes so levied or imposed and
paid by such Lender.
(b) Each Lender that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) agrees to deliver to the
Borrower and the Administrative Agent on or prior to the Closing Date, or
in the case of a Lender that is an assignee or transferee of an interest
under this Credit Agreement pursuant to Section 9.6(c) (unless the
respective Lender was already a Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to
such Lender, (i) if the Lender is a "bank" within the meaning of Section
881(c)(3)(A) of the Code, two (2) accurate and complete original signed
copies of Internal Revenue Service Form ▇-▇▇▇▇, ▇-▇▇▇▇ or W-8IMY (or
successor forms) certifying such Lender's entitlement to a complete
exemption from United States withholding tax with respect to payments to
be made under this Credit Agreement and under any Note, or (ii) if the
Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, Internal Revenue Service Form ▇-▇▇▇▇, ▇-▇▇▇▇ or W-8IMY as set forth
in clause (i) above, or (x) a certificate in substantially the form of
Schedule 2.20 (any such certificate, a "Tax Exempt Certificate") and (y)
two (2) accurate and complete original signed copies of Internal Revenue
Service Form W-8BEN (or successor form) certifying such Lender's
entitlement to an exemption from United States withholding tax with
respect to payments of interest to be made under this Credit Agreement and
under any Note. In addition, each Lender agrees that it will deliver upon
the Borrower's request updated versions of the foregoing, as applicable,
whenever the previous certification has become obsolete or inaccurate in
any material respect, together with such other forms as may be required in
order to
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confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with respect
to payments under this Credit Agreement and any Note. Notwithstanding
anything to the contrary contained in Section 2.19(a), but subject to the
immediately succeeding sentence, (x) the Borrower shall be entitled, to
the extent it is required to do so by law, to deduct or withhold Taxes
imposed by the United States (or any political subdivision or taxing
authority thereof or therein) from interest, fees or other amounts payable
hereunder for the account of any Lender which is not a United States
person (as such term is defined in Section 7701(a)(30) of the Code) for
U.S. federal income tax purposes to the extent that such Lender has not
provided to the Borrower U.S. Internal Revenue Service Forms that
establish a complete exemption from such deduction or withholding and (y)
the Borrower shall not be obligated pursuant to Section 2.19(a) hereof to
gross-up payments to be made to a Lender in respect of Taxes imposed by
the United States if (I) such Lender has not provided to the Borrower the
Internal Revenue Service Forms required to be provided to the Borrower
pursuant to this Section 2.19(b) or (II) in the case of a payment, other
than interest, to a Lender described in clause (ii) above, to the extent
that such Forms do not establish a complete exemption from withholding of
such Taxes. Notwithstanding anything to the contrary contained in the
preceding sentence or elsewhere in this Section 2.19, the Borrower agrees
to pay additional amounts and to indemnify each Lender in the manner set
forth in Section 2.19(a) (without regard to the identity of the
jurisdiction requiring the deduction or withholding) in respect of any
amounts deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes after the Closing Date in
any applicable law, treaty, governmental rule, regulation, guideline or
order, or in the interpretation thereof, relating to the deducting or
withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its Domestic Lending Office or LIBOR Lending
Office, as the case may be) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this Section; provided, however,
that such efforts shall not cause the imposition on such Lender of any
additional costs or legal or regulatory burdens deemed by such Lender in
its sole discretion to be material.
(d) If the Borrower pays any additional amount pursuant to this
Section 2.19 with respect to a Lender, such Lender shall use reasonable
efforts to obtain a refund of tax or credit against its tax liabilities on
account of such payment; provided that such Lender shall have no
obligation to use such reasonable efforts if either (i) it is in an excess
foreign tax credit position or (ii) it believes in good faith, in its sole
discretion, that claiming a refund or credit would cause adverse tax
consequences to it. In the event that such Lender receives such a refund
or credit, such Lender shall pay to the Borrower an amount that such
Lender reasonably determines is equal to the net tax benefit obtained by
such Lender as a result of such payment by the Borrower. In the event that
no refund or credit is obtained with respect to the Borrower's payments to
such Lender pursuant to this Section 2.19, then such Lender shall upon
request provide a certification that such Lender has not received a refund
or credit for such payments.
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(e) The agreements in this Section 2.19 shall survive the
termination of this Credit Agreement and the payment of the Notes and all
other amounts payable hereunder.
SECTION 2.20 INDEMNIFICATION; NATURE OF ISSUING LENDER'S DUTIES.
(a) In addition to its other obligations under Section 2.2 and
Section 2.5, the Borrower hereby agrees to protect, indemnify, pay and
save each Issuing Lender and each Lender harmless from and against any and
all claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees) that each Issuing Lender
or such Lender may incur or be subject to as a consequence, direct or
indirect, of (i) the issuance of any Letter of Credit or (ii) the failure
of such Issuing Lender to honor a drawing under a Letter of Credit as a
result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority
(all such acts or omissions, herein called "Government Acts").
(b) As between the Borrower and each Issuing Lender and each Lender,
the Borrower shall assume all risks of the acts, omissions or misuse of
any Letter of Credit by the beneficiary thereof. Neither any Issuing
Lender nor any Lender shall be responsible: (i) for 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 any Letter of Credit, even if it should in fact prove to be in any or
all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii)
for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part,
that may prove to be invalid or ineffective for any reason; (iii) for
failure of the beneficiary of a Letter of Credit to comply fully with
conditions required in order to draw upon a Letter of Credit; (iv) for
errors, omissions, interruptions or delays in transmission or delivery of
any messages, by mail, cable, telegraph, telex or otherwise, whether or
not they be in cipher; (v) for errors in interpretation of technical
terms; (vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under a Letter of Credit or
of the proceeds thereof; and (vii) for any consequences arising from
causes beyond the control of any Issuing Lender or any Lender, including,
without limitation, any Government Acts. None of the above shall affect,
impair, or prevent the vesting of each Issuing Lender's rights or powers
hereunder.
(c) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
any Issuing Lender or any Lender, under or in connection with any Letter
of Credit or the related certificates, if taken or omitted in the absence
of gross negligence or willful misconduct, shall not put such Issuing
Lender or such Lender under any resulting liability to the Borrower. It is
the intention of the parties that this Credit Agreement shall be construed
and applied to protect and indemnify each Issuing Lender and each Lender
against any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower, including,
without limitation, any and all risks of the acts or omissions, whether
rightful or wrongful, of any Government Authority. The Issuing Lenders and
the Lenders shall not, in any way, be liable for any failure by any
Issuing Lender or anyone
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else to pay any drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the Issuing
Lenders and the Lenders.
(d) Nothing in this Section 2.20 is intended to limit the
reimbursement obligation of the Borrower contained in Section 2.2 and
Section 2.5 hereof. The obligations of the Borrower under this Section
2.20 shall survive the termination of this Credit Agreement. No act or
omissions of any current or prior beneficiary of a Letter of Credit shall
in any way affect or impair the rights of the Credit-Linked Issuing Lender
and the Lenders to enforce any right, power or benefit under this Credit
Agreement.
(e) Notwithstanding anything to the contrary contained in this
Section 2.20, the Borrower shall have no obligation to indemnify any
Issuing Lender or any Lender in respect of any liability incurred by such
Issuing Lender or such Lender arising out of the gross negligence or
willful misconduct of such Issuing Lender (including action not taken by
such Issuing Lender or such Lender), as determined by a court of competent
jurisdiction or pursuant to arbitration.
SECTION 2.21 REPLACEMENT OF LENDERS.
If any Lender shall become affected by any of the changes or events
described in Sections 2.16, 2.17, 2.18 or 2.19 (any such Lender being
hereinafter referred to as a "Replaced Lender") and shall petition the Borrower
for any increased cost or amounts thereunder, then in such case, the Borrower
may, upon at least thirty (30) Business Days' notice to the Administrative Agent
and such Replaced Lender and so long as no Default or Event of Default has
occurred and is continuing, designate a replacement lender (a "Replacement
Lender") acceptable to the Administrative Agent in its reasonable discretion, to
which such Replaced Lender shall, subject to its receipt (unless a later date
for the remittance thereof shall be agreed upon by the Borrower and the Replaced
Lender) of all amounts owed to such Replaced Lender under Sections 2.16, 2.17,
2.18 or 2.19, assign at par all (but not less than all) of its rights,
obligations, Loans and Commitments hereunder; provided, that all amounts owed to
such Replaced Lender by the Borrower (except liabilities which by the terms
hereof survive the payment in full of the Loans and termination of this
Agreement) shall be paid in full as of the date of such assignment. Upon any
assignment by any Lender pursuant to this Section 2.21 becoming effective, the
Replacement Lender shall thereupon be deemed to be a "Lender" for all purposes
of this Agreement and such Replaced Lender shall thereupon cease to be a
"Lender" for all purposes of this Agreement and shall have no further rights or
obligations hereunder (other than pursuant to Sections 2.16, 2.17, 2.18 or 2.19,
and 9.5 while such Replaced Lender was a Lender). If any Replaced Lender shall
refuse to assign its rights, obligations, Loans and Commitment in accordance
with the terms of this Section 2.21, the Replaced Lender shall cease to be a
"Lender" for all purposes of this Agreement upon payment to the Replaced Lender
of all amounts owing to such Replaced Lender in accordance with the terms of
this Section 2.21 without any further action of such Replaced Lender and so long
as no Default or Event of Default shall have occurred and be continuing, the
Borrower shall have the right to designate a Replacement Lender acceptable to
the Administrative Agent in its reasonable discretion.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Credit Agreement and to make the
Extensions of Credit herein provided for, each of the Credit Parties hereby
represents and warrants to the Administrative Agent and to each Lender that:
SECTION 3.1 FINANCIAL CONDITION.
(a) (i) The audited Consolidated financial statements of the
Borrower and its consolidated Subsidiaries for the fiscal years ended
November 30, 2001, 2002 and 2003, together with the related Consolidated
statements of income or operations, equity and cash flows for the fiscal
years ended on such dates, (ii) the unaudited Consolidated financial
statements of the Borrower and its Subsidiaries for the nine-month period
ending on August 31, 2004, together with the related Consolidated
statements of income or operations, equity and cash flows for the
nine-month period ending on such date and (iii) a pro forma balance sheet
of the Borrower and its Subsidiaries as of the last day of the quarter
ended immediately prior to the Closing Date:
(A) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly
noted therein;
(B) fairly present the financial condition of the Borrower and
its Subsidiaries as of the date thereof (subject, in the case of the
unaudited financial statements, to normal year-end adjustments) and
results of operations for the period covered thereby;
(C) show all material Indebtedness and other liabilities,
direct or contingent, of the Borrower and its Subsidiaries as of the
date thereof, including liabilities for taxes, material commitments
and contingent obligations, required to be shown on a balance sheet
prepared in accordance with GAAP; and
(D) show all other material Indebtedness and other
liabilities, direct or contingent, of the Borrower and its
Subsidiaries as of the date thereof, in the notes (shown in
accordance with GAAP) to the financial statements referred to in
Section 3.1(a)(i) and (ii) above.
(b) The six-year projections of the Borrower and its Subsidiaries
delivered to the Lenders on or prior to the Closing Date have been
prepared in good faith based upon reasonable assumptions.
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SECTION 3.2 NO CHANGE.
Since November 30, 2003, there has been no development or event which has
had or could reasonably be expected to have a Material Adverse Effect.
SECTION 3.3 CORPORATE EXISTENCE.
Each of the Credit Parties (a) is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, (b) has
the requisite power and authority and the legal right to own and operate all its
material property, to lease the material property it operates as lessee and to
conduct the business in which it is currently engaged, and (c) is duly qualified
to conduct business and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification, except to the extent that such failure to
qualify could not reasonably be expected to have a Material Adverse Effect. The
jurisdictions in which the Credit Parties as of the Closing Date are organized
and qualified to do business are described on Schedule 3.3.
SECTION 3.4 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
Each of the Credit Parties has full power and authority and the legal
right to make, deliver and perform the Credit Documents to which it is party and
has taken all necessary action to authorize the execution, delivery and
performance by it of the Credit Documents to which it is party. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
borrowings hereunder or with the execution, delivery or performance of any
Credit Document by any of the Credit Parties (other than those which have been
obtained) or with the validity or enforceability of any Credit Document against
any of the Credit Parties (except such filings as are necessary in connection
with the perfection of the Liens created by such Credit Documents). Each Credit
Document to which it is a party has been duly executed and delivered on behalf
of the applicable Credit Party. Each Credit Document to which it is a party
constitutes a legal, valid and binding obligation of each such Credit Party,
enforceable against such Credit Party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
SECTION 3.5 COMPLIANCE WITH LAWS; NO CONFLICT; NO DEFAULT.
(a) The execution, delivery and performance by each Credit Party of
the Credit Documents to which such Credit Party is a party, in accordance
with their respective terms, the borrowings hereunder and the Transactions
do not and will not, by the passage of time, the giving of notice or
otherwise, (i) require any Governmental Approval (other than such
Governmental Approvals that have been obtained or made and not subject to
suspension, revocation or termination) or violate any Requirement of Law
relating to such Credit Party, (ii) conflict with, result in a breach of
or constitute a default under the articles of incorporation, bylaws,
articles of organization, operating agreement
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or other organizational documents of such Credit Party or any material
indenture, agreement or other instrument to which such Person is a party
or by which any of its properties may be bound or any Governmental
Approval relating to such Person, or (iii) result in or require the
creation or imposition of any Lien upon or with respect to any property
now owned or hereafter acquired by such Person other than Liens arising
under the Credit Documents.
(b) Each Credit Party (i) (x) has all Governmental Approvals
required by law for it to conduct its business, each of which is in full
force and effect, (y) each such Governmental Approval is final and not
subject to review on appeal and (z) each such Governmental Approval is not
the subject of any pending or, to the best of its knowledge, threatened
attack by direct or collateral proceeding, and (ii) is in compliance with
each Governmental Approval applicable to it and in compliance with all
other Requirements of Law relating to it or any of its respective
properties, in each case except to the extent the failure to obtain such
Governmental Approval or failure to comply with such Governmental Approval
or Requirement of Law could not reasonably be expected to have a Material
Adverse Effect. Each Credit Party possesses or has the right to use, all
leaseholds, licenses, easements and franchises and all authorizations and
other rights that are material to and necessary for the conduct of its
business. Except to the extent noncompliance with the foregoing
leaseholds, easements and franchises could not reasonably be expected to
have a Material Adverse Effect, all of the foregoing are in full force and
effect, and the Credit Parties are in substantial compliance with the
foregoing without any known conflict with the valid rights of others. No
event has occurred which permits, or after notice or lapse of time or both
would permit, the revocation or termination of any such Governmental
Approval, leasehold, license, easement, franchise or other right, which
termination or revocation could, individually or in the aggregate,
reasonably be expected to have Material Adverse Effect.
(c) None of the Credit Parties is in default under or with respect
to any of its Material Contracts or under or with respect to any of its
other Contractual Obligations, or any judgment, order or decree to which
it is a party, in any respect which could reasonably be expected to have a
Material Adverse Effect. No Default or Event of Default has occurred and
is continuing.
SECTION 3.6 NO MATERIAL LITIGATION.
No litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Credit Parties,
threatened by or against any of them or against any of their respective
properties or revenues (a) with respect to the Credit Documents or any Loan or
any of the Transactions, or (b) which could reasonably be expected to have a
Material Adverse Effect.
SECTION 3.7 INVESTMENT COMPANY ACT; PUHCA.
None of the Credit Parties (a) is an "investment company", or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as
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amended or (b) 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," within the meaning of the Public Utility Holding Company
Act of 1935.
SECTION 3.8 MARGIN REGULATIONS.
No part of the proceeds of any Loan hereunder will be used directly or
indirectly for any purpose which violates, or which would be inconsistent with,
the provisions of Regulation T, U or X of the Board of Governors of the Federal
Reserve System as now and from time to time hereafter in effect. The Credit
Parties (a) are not engaged, principally or as one of its important activities,
in the business of extending credit for the purpose of "purchasing" or
"carrying" "margin stock" within the respective meanings of each of such terms
under Regulation U and (b) taken as a group do not own "margin stock" except as
identified in the financial statements referred to in Section 3.1 and the
aggregate value of all "margin stock" owned by the Credit Parties taken as a
group does not exceed 25% of the value of their assets.
SECTION 3.9 ERISA.
Neither a Reportable Event nor an "accumulated funding deficiency" (within
the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred
during the five-year period prior to the date on which this representation is
made or deemed made with respect to any Plan, and each Plan has complied in all
material respects with the applicable provisions of ERISA and the Code, except
to the extent that any such occurrence or failure to comply would not reasonably
be expected to have a Material Adverse Effect. No termination of a Single
Employer Plan has occurred resulting in any liability that has remained
underfunded, and no Lien in favor of the PBGC or a Plan has arisen, during such
five-year period which could reasonably be expected to have a Material Adverse
Effect. The present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by an amount which could reasonably be expected to have a
Material Adverse Effect. Neither the Borrower, nor any Subsidiary of the
Borrower nor any Commonly Controlled Entity is currently subject to any
liability for a complete or partial withdrawal from a Multiemployer Plan that
could reasonably be expected to have a Material Adverse Effect.
SECTION 3.10 ENVIRONMENTAL MATTERS.
(a) Except where such violation or liability could not reasonably be
expected to have a Material Adverse Effect, the facilities and properties
owned, leased or operated by any of the Credit Parties (the "Properties")
do not contain any Materials of Environmental Concern in amounts or
concentrations which (i) constitute a violation of, or (ii) could give
rise to liability under, any Environmental Law.
(b) Except where such violation, contamination or non-compliance
could not reasonably be expected to have a Material Adverse Effect, the
Properties and all operations of the Credit Parties at the Properties are
in compliance, and have in the last
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five (5) years been in compliance, in all material respects with all
applicable Environmental Laws, and there is no contamination at, under or
about the Properties or violation of any Environmental Law with respect to
the Properties or the business operated by the any of the Credit Parties
(the "Business").
(c) None of the Credit Parties has received any written or actual
notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the Business,
nor does any of the Credit Parties have knowledge of any such threatened
notice which could reasonably be expected to have a Material Adverse
Effect.
(d) Except where such violation or liability could not reasonably be
expected to have a Material Adverse Effect, Materials of Environmental
Concern have not been transported or disposed of from the Properties in
violation of, or in a manner or to a location which could give rise to
liability under any Environmental Law, nor have any Materials of
Environmental Concern been generated, treated, stored or disposed of at,
on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of any Credit Party, threatened, under any
Environmental Law to which any of the Credit Parties is or will be named
as a party with respect to the Properties or the Business, nor are there
any consent decrees or other decrees, consent orders, administrative
orders or other orders, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or
the Business which could reasonably be expected to have a Material Adverse
Effect.
(f) Except where such violation or liability could not reasonably be
expected to have a Material Adverse Effect, there has been no release or
threat of release of Materials of Environmental Concern at or from the
Properties, or arising from or related to the operations of any of the
Credit Parties in connection with the Properties or otherwise in
connection with the Business, in violation of or in amounts or in a manner
that could give rise to liability under Environmental Laws.
SECTION 3.11 USE OF PROCEEDS.
The proceeds of the Extensions of Credit will be used (i) to refinance
certain existing Indebtedness of the Borrower, (ii) to pay any fees and expenses
associated with this Credit Agreement and other financings of the Borrower on
the Closing Date, (iii) to finance Permitted Acquisitions and (iv) for working
capital and other general corporate purposes of the Borrower and its
Subsidiaries.
SECTION 3.12 SUBSIDIARIES.
Set forth on Schedule 3.12 (as updated quarterly by the Borrower) is a
complete and accurate list of all Subsidiaries of the Credit Parties.
Information on such Schedule includes the
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number of shares of each class of Capital Stock or other equity interests
outstanding; the number and percentage of outstanding shares of each class of
stock owned by the Credit Parties or any of their Subsidiaries; the number and
effect, if exercised, of all outstanding options, warrants, rights of conversion
or purchase and similar rights. The outstanding Capital Stock and other equity
interests of all such Subsidiaries is validly issued, fully paid and
non-assessable and is owned, free and clear of all Liens (other than those
arising under or contemplated in connection with the Credit Documents).
SECTION 3.13 OWNERSHIP.
Each of the Credit Parties is the owner of, and has good and marketable
title to, all of its respective assets, which, together with assets leased or
licensed by the Credit Parties, represents all assets individually or in the
aggregate material to the conduct of the businesses of the Credit Parties, taken
as a whole on the date hereof, and none of such assets is subject to any Lien
other than Permitted Liens. Each Credit Party enjoys peaceful and undisturbed
possession under all of its material leases and all such material leases are
valid and subsisting and in full force and effect. The Credit Parties have made
available complete and accurate copies of all material leases to the
Administrative Agent.
SECTION 3.14 INDEBTEDNESS.
Except as otherwise permitted under Section 6.1, the Credit Parties have
no Indebtedness.
SECTION 3.15 TAXES.
Each of the Credit Parties has filed, or caused to be filed, all tax
returns (federal, state, local and foreign) required to be filed and paid (a)
all material amounts of taxes shown thereon to be due (including interest and
penalties) and (b) all other taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) which are not yet
delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. None of the Credit Parties is aware as of the Closing Date
of any proposed tax assessments against it or any of its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect.
SECTION 3.16 INTELLECTUAL PROPERTY RIGHTS.
Each of the Credit Parties and their Subsidiaries owns, or has the legal
right to use, all Intellectual Property necessary for each of them to conduct
its business as currently conducted. Set forth on Schedule 3.16 (as updated
quarterly by the Borrower) is a list of all Intellectual Property (other than
Intellectual Property of de minimus value) owned by each of the Credit Parties
and their Subsidiaries or that the Credit Parties or any of their Subsidiaries
has the right to use. Except as disclosed in Schedule 3.16 hereto, with respect
to the material Intellectual Property of the Credit Parties, (a) one or more of
the Credit Parties has the right to use such Intellectual Property in perpetuity
and without payment of royalties, (b) all material registrations with and
applications to Governmental Authorities in respect of such Intellectual
Property are
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valid and in full force and effect and are not subject to the taking of any
interest therein, and no taxes or maintenance fees payable with respect to such
Intellectual Property to maintain their validity or effectiveness are
delinquent, and (c) there are no restrictions on the direct or indirect transfer
of any Contractual Obligation, or any interest therein, held by any of the
Credit Parties in respect of such Intellectual Property. None of the Credit
Parties is in default (or with the giving of notice or lapse of time or both,
would be in default) in any material respect under any license to use such
Intellectual Property; no claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does the Credit
Parties or any of their Subsidiaries know of any such claim; and, to the
knowledge of the Credit Parties or any of their Subsidiaries, the use of such
Intellectual Property by the Credit Parties or any of their Subsidiaries does
not infringe on the rights of any Person, except for such defaults, claims and
infringements that in the aggregate could not reasonably be expected to have a
Material Adverse Effect. The Credit Parties have recorded or deposited with and
paid to the United States Copyright Office, the Register of Copyrights, the
Copyrights Royalty Tribunal or other Governmental Authority, all notices,
statements of account, royalty fees and other documents and instruments required
under the terms and conditions of any Contractual Obligation of the Credit
Parties and/or under Title 17 of the United States Code and the rules and
regulations issued thereunder (collectively, the "Copyright Act"), and are not
liable to any Person for copyright infringement under the Copyright Act or any
other law, rule, regulation, contract or license as a result of their business
operations. Schedule 3.16 may be updated from time to time by the Borrower to
include new Intellectual Property by giving written notice thereof to the
Administrative Agent.
SECTION 3.17 SOLVENCY.
After giving effect to the Transactions, the fair saleable value of each
Credit Party's assets, measured on a going concern basis, exceeds all probable
liabilities, including those to be incurred pursuant to this Credit Agreement.
After giving effect to the Transactions, none of the Credit Parties (a) has
unreasonably small capital in relation to the business in which it is or
proposes to be engaged or (b) has incurred, or believes that it will incur after
giving effect to the Transactions, debts beyond its ability to pay such debts as
they become due. In executing the Credit Documents and consummating the
Transactions, none of the Credit Parties intends to hinder, delay or defraud
either present or future creditors or other Persons to which one or more of the
Credit Parties is or will become indebted.
SECTION 3.18 INVESTMENTS.
All Investments of each of the Credit Parties are Permitted Investments.
SECTION 3.19 LOCATION OF COLLATERAL.
Set forth on Schedule 3.19(a) is a list of the Properties of the Credit
Parties and their Subsidiaries as of the Closing Date with street address,
county and state where located. Set forth on Schedule 3.19(b) is a list of all
locations where any tangible personal property of the Credit Parties and their
Subsidiaries is located as of the Closing Date, including county and state where
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located. Set forth on Schedule 3.19(c) is the chief executive office and
principal place of business of each of the Credit Parties as of the Closing
Date.
SECTION 3.20 NO BURDENSOME RESTRICTIONS.
None of the Credit Parties is a party to any agreement or instrument or
subject to any other obligation or any charter or corporate restriction or any
provision of any applicable law, rule or regulation which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
SECTION 3.21 BROKERS' FEES.
None of the Credit Parties and their Subsidiaries has any obligation to
any Person in respect of any finder's, broker's, investment banking or other
similar fee in connection with the Credit Agreement and the loans hereunder,
other than the closing and other fees payable pursuant to this Credit Agreement
and as set forth in the Fee Letter.
SECTION 3.22 LABOR MATTERS.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of the Credit Parties as of the Closing Date, other than
as set forth in Schedule 3.22 hereto, and none of the Credit Parties is
suffering or has suffered any strikes, walkouts, work stoppages or other
material labor difficulty within the last five (5) years, other than as set
forth in Schedule 3.22 hereto.
SECTION 3.23 ACCURACY AND COMPLETENESS OF INFORMATION.
All factual information heretofore, contemporaneously or hereafter
furnished by or on behalf of the Credit Parties in writing to the Administrative
Agent or any Lender for purposes of or in connection with this Credit Agreement
or any other Credit Document (other than any projection provided by the Borrower
in good faith), or any transaction contemplated hereby or thereby, is or will be
true and accurate in all material respects and not incomplete by omitting to
state any material fact necessary to make such information not misleading. There
is no fact now known to any of the Credit Parties which has, or could reasonably
be expected to have, a Material Adverse Effect which fact has not been set forth
herein, in the financial statements of the Credit Parties furnished to the
Administrative Agent and/or the Lenders, or in any certificate, opinion or other
written statement made or furnished by or on behalf of the Credit Parties to the
Administrative Agent and/or the Lenders.
SECTION 3.24 MATERIAL CONTRACTS.
Schedule 3.24 sets forth a complete and accurate list of all Material
Contracts of the Credit Parties and their Subsidiaries in effect as of the
Closing Date. Other than as set forth in Schedule 3.24, each such Material
Contract is, and after giving effect to the Transactions will be, in full force
and effect in accordance with the terms thereof. The Credit Parties and their
Subsidiaries have made available to the Administrative Agent a true and complete
copy of each
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Material Contract. Schedule 3.24 may be updated from time to time by the
Borrower to include new Material Contracts by giving written notice thereof to
the Administrative Agent.
SECTION 3.25 INSURANCE.
The insurance coverage of the Credit Parties and their Subsidiaries as of
the Closing Date is outlined as to carrier, policy number, expiration date, type
and amount on Schedule 3.25 and such insurance coverage complies with the
requirements set forth in Section 5.5(b).
SECTION 3.26 SECURITY DOCUMENTS.
The Security Documents create valid security interests in, and Liens on,
the Collateral purported to be covered thereby, which security interests and
Liens are currently (or will be, upon the execution of control agreements with
respect to deposit and securities accounts and the filing or recording of
appropriate financing statements, Mortgage Instruments and notices of grants of
security interests in Intellectual Property, in each case in favor of the
Administrative Agent on behalf of the Secured Parties) perfected security
interests and Liens, prior to all other Liens other than Permitted Liens.
SECTION 3.27 REGULATION H.
No Mortgaged Property is a Flood Hazard Property.
SECTION 3.28 CLASSIFICATION OF SENIOR INDEBTEDNESS.
The Credit Party Obligations constitute "Senior Indebtedness" under and as
defined in any agreement governing any Subordinated Debt (including, without
limitation, the Existing Subordinated Notes and the New Convertible Notes) and
the subordination provisions set forth in each such agreement are legally valid
and enforceable against the parties thereto.
SECTION 3.29 COMPLIANCE WITH TRADING WITH THE ENEMY ACT, OFAC RULES AND
REGULATIONS AND PATRIOT ACT.
(a) Neither any Credit Party nor any of its Subsidiaries is an
"enemy" or an "ally of the enemy" within the meaning of Section 2 of the
Trading with the Enemy Act of the United States of America (50 U.S.C. App.
Section 1 et seq.), as amended. Neither any Credit Party nor any or its
Subsidiaries is in violation of (i) the Trading with the Enemy Act, as
amended, (ii) any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or
any enabling legislation or executive order relating thereto or (iii) the
Patriot Act (as defined in Section 9.17). None of the Credit Parties (A)
is a blocked person described in section 1 of the Anti-Terrorism Order or
(B) to the best of its knowledge, engages in any dealings or transactions,
or is otherwise associated, with any such blocked person.
(b) None of the Borrower, any Subsidiary of the Borrower or any
Affiliate of the Borrower or any Guarantor (i) is a Sanctioned Person,
(ii) has more than 15% of its
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assets in Sanctioned Countries, or (iii) derives more than 15% of its
operating income from investments in, or transactions with Sanctioned
Persons or Sanctioned Countries. The proceeds of any Loan will not be used
and have not been used to fund any operations in, finance any investments
or activities in or make any payments to, a Sanctioned Person or a
Sanctioned Country.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1 CONDITIONS TO CLOSING DATE.
This Credit Agreement shall become effective upon, and the obligation
of each Lender to make the initial Revolving Loans, Term Loans and Swingline
Loans on the Closing Date and to fund its Credit-Linked Deposit is subject to,
the satisfaction of the following conditions precedent:
(a) Execution of Credit Agreement and Credit Documents. The
Administrative Agent shall have received (i) counterparts of this Credit
Agreement, (ii) for the account of each Lender with a Revolving Commitment
requesting a promissory note, a Revolving Note, (iii) for the account of
the Swingline Lender, the Swingline Note, (iv) for the account of each
Credit-Linked Issuing Lender, a Credit-Linked Note, (v) counterparts of
the Security Agreement and the Pledge Agreement and (vi) counterparts of
any other Credit Document, in each case conforming to the requirements of
this Credit Agreement and executed by duly authorized officers of the
Credit Parties and the other parties thereto, as applicable.
(b) Authority Documents. The Administrative Agent shall have
received the following:
(i) Articles of Incorporation; Partnership Agreement. Copies
of the articles of incorporation, partnership agreement or other
charter documents of each Credit Party certified to be true and
complete as of a recent date by the appropriate governmental
authority of the state of its organization or formation.
(ii) Resolutions. Copies of resolutions of the board of
directors of each Credit Party approving and adopting the Credit
Documents and the Transactions and authorizing execution and
delivery thereof, certified by an officer of such Credit Party as of
the Closing Date to be true and correct and in force and effect as
of such date.
(iii) Bylaws. A copy of the bylaws or other operating
agreement of each Credit Party certified by an officer of such
Credit Party as of the Closing Date to be true and correct and in
force and effect as of such date.
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(iv) Good Standing. Copies of (i) certificates of good
standing, existence or its equivalent with respect to the each
Credit Party certified as of a recent date by the appropriate
governmental authorities of the state of incorporation and each
other state in which the failure of such Credit Party to be
qualified to do business could reasonably be expected to have a
Material Adverse Effect and (ii) to the extent readily available, a
certificate indicating payment of all corporate and other franchise
taxes certified as of a recent date by the appropriate governmental
taxing authorities.
(v) Incumbency. An incumbency certificate of each Credit Party
certified by a secretary or assistant secretary to be true and
correct as of the Closing Date.
Each officer's certificate delivered pursuant to this Section 4.1(b)
shall be substantially in the form of Schedule 4.1(b) hereto.
(c) Legal Opinions of Counsel. The Administrative Agent shall have
received an opinion or opinions of counsel for the Credit Parties, dated
as of the Closing Date and addressed to the Administrative Agent and the
Lenders, in form and substance acceptable to the Administrative Agent.
(d) Personal Property Collateral. The Administrative Agent shall
have received, in form and substance satisfactory to the Administrative
Agent:
(i) searches of UCC filings in the jurisdiction of the chief
executive office and jurisdiction of formation of each Credit Party
and each jurisdiction where any Collateral is located or where a
filing would need to be made in order to perfect the Administrative
Agent's security interest in the Collateral, copies of the financing
statements on file in such jurisdictions and evidence that no Liens
exist other than Permitted Liens and Liens that are to be terminated
on the Closing Date;
(ii) UCC financing statements for each appropriate
jurisdiction as is necessary, in the Administrative Agent's sole
discretion, to perfect the Administrative Agent's security interest
in the Collateral;
(iii) searches of ownership of Intellectual Property in the
appropriate governmental offices;
(iv) such patent/trademark/copyright filings as requested by
the Administrative Agent in order to perfect the Administrative
Agent's security interest in the Intellectual Property;
(v) all stock certificates, if any, evidencing the Capital
Stock pledged to the Administrative Agent pursuant to the Pledge
Agreement, together with duly executed in blank undated stock powers
attached thereto;
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(vi) all instruments and chattel paper in the possession of
any of the Credit Parties, together with allonges or assignments as
may be necessary or appropriate to perfect the Administrative
Agent's security interest in the Collateral;
(vii) duly executed consents as are necessary, in the
Administrative Agent's sole discretion, to perfect the Lenders'
security interest in the Collateral; and
(viii) subject to Section 5.14(c), such duly executed account
control agreements as requested by the Administrative Agent with
respect to Collateral for which a control agreement is required for
perfection of the Administrative Agent's security interest under the
Uniform Commercial Code.
(e) Real Property Collateral. The Administrative Agent shall have
received, in form and substance satisfactory to the Administrative Agent:
(i) fully executed and notarized Mortgage Instruments
encumbering the Mortgaged Properties (and assigning the leases and
rents with respect to such Mortgaged Properties) listed in Schedule
3.19(a);
(ii) a title report obtained by the Credit Parties in respect
of each of the Mortgaged Properties listed in Schedule 3.19(a);
(iii) a Mortgage Policy with respect to each of the Mortgaged
Properties listed in Schedule 3.19(a);
(iv) a satisfactory appraisal of certain real property
designated by the Administrative Agent from an appraiser selected by
the Administrative Agent;
(v) evidence as to (A) whether any Mortgaged Property listed
in Schedule 3.19(a) is in an area designated by the Federal
Emergency Management Agency as having special flood or mud slide
hazards (a "Flood Hazard Property") and (B) if any such Mortgaged
Property is a Flood Hazard Property, (1) whether the community in
which such Mortgaged Property is located is participating in the
National Flood Insurance Program, (2) the applicable Credit Party's
written acknowledgment of receipt of written notification from the
Administrative Agent (x) as to the fact that such Mortgaged Property
is a Flood Hazard Property and (y) as to whether the community in
which each such Flood Hazard Property is located is participating in
the National Flood Insurance Program and (z) copies of insurance
policies or certificates of insurance of the Credit Parties
evidencing flood insurance reasonably satisfactory to the
Administrative Agent and naming the Administrative Agent as sole
loss payee on behalf of the Lenders;
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(vi) to the extent available, surveys of the Mortgaged
Properties listed in Schedule 3.19(a); and
(vii) an opinion of counsel to the Credit Parties for each
jurisdiction in which the Mortgaged Properties are located.
(f) Liability and Casualty Insurance. The Administrative Agent shall
have received copies of insurance policies or certificates of insurance
evidencing liability and casualty insurance (including, but not limited
to, business interruption insurance) meeting the requirements set forth
herein or in the Security Documents. The Administrative Agent shall be
named as loss payee on all casualty insurance policies and as additional
insured on all liability insurance policies, in each case for the benefit
of the Lenders.
(g) Litigation. There shall not exist any pending litigation or
investigation affecting or relating to (i) any Credit Party or any of its
Subsidiaries that in the reasonable judgment of the Administrative Agent
and Lenders could have a Material Adverse Effect on any Credit Party or
any of its Subsidiaries, this Agreement or the other Credit Documents,
that has not been settled, dismissed, vacated, discharged or terminated
prior to the Closing Date or (ii) this Agreement or the other Credit
Documents that have not been settled, dismissed, vacated, discharged or
terminated prior to the Closing Date.
(h) Solvency Certificate. The Administrative Agent shall have
received an officer's certificate prepared by the chief financial officer
of the Borrower as to the financial condition, solvency and related
matters of each of the Credit Parties and the Credit Parties and their
Subsidiaries taken as a whole, after giving effect to the initial
borrowings under the Credit Documents, in substantially the form of
Schedule 4.1(h) hereto.
(i) Account Designation Letter. The Administrative Agent shall have
received the executed Account Designation Letter in the form of Schedule
1.1(a) hereto.
(j) Organizational Structure. The corporate and capital and
ownership structure of the Credit Parties and their Subsidiaries (after
giving effect to the Transactions) shall be as described in Schedule 3.12.
The Administrative Agent shall be satisfied with the management structure,
legal structure, voting control, liquidity, total leverage and total
capitalization of the Credit Parties and their Subsidiaries after giving
effect to the Transactions.
(k) Consents. The Administrative Agent shall have received evidence
that all boards of directors, governmental, shareholder and material third
party consents and approvals necessary in connection with the Transactions
have been obtained and all applicable waiting periods have expired without
any action being taken by any authority that could restrain, prevent or
impose any material adverse conditions on such transactions or that could
seek or threaten any of the foregoing.
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(l) Compliance with Laws. The Transactions shall be in compliance
with all applicable laws and regulations (including all applicable
securities and banking laws, rules and regulations).
(m) Bankruptcy. There shall be no bankruptcy or insolvency
proceedings with respect to Credit Parties or any of their Subsidiaries.
(n) Existing Indebtedness of the Credit Parties. All of the existing
Indebtedness for borrowed money of the Borrower and its Subsidiaries
(other than Indebtedness permitted to exist pursuant to Section 6.1) shall
be repaid in full and all security interests related thereto shall be
terminated on the Closing Date.
(o) Financial Statements. The Administrative Agent and the Lenders
shall have received copies of the financial statements referred to in
Section 3.1 hereof, each in form and substance satisfactory to it.
(p) No Material Adverse Change. Since November 30, 2003, there shall
not have occurred any event or development that has had or could
reasonably be expected to have a Material Adverse Effect on the business,
properties, operations or financial condition of the Borrower or any of
its Subsidiaries and there shall not have occurred any material disruption
or material adverse change in the financial, banking or capital markets
(including the loan syndication market) that has impaired or would impair
the Arranger's ability to syndicate the facilities.
(q) Financial Condition Certificate. The Administrative Agent shall
have received a certificate or certificates executed by a Responsible
Officer of the Borrower as of the Closing Date stating that (i) no action,
suit, investigation, injunction, order, claim or proceeding is pending,
ongoing or, to the knowledge of any Credit Party, threatened in any court
or before any other Governmental Authority that purports to affect any
Credit Party or any transaction contemplated by the Credit Documents,
which action, suit, investigation, injunction, order, claim or proceeding
could reasonably be expected to have a Material Adverse Effect and (ii)
immediately after giving effect to this Credit Agreement, the other Credit
Documents, and all the Transactions contemplated to occur on such date,
(A) no Default or Event of Default exists, (B) all representations and
warranties contained herein and in the other Credit Documents (i) that
contain a materiality qualification shall be true and correct and (ii)
that do not contain a materiality qualification shall be true and correct
in all material respects, and (C) the Credit Parties are in pro forma
compliance with each of the initial financial covenants set forth in
Section 5.9 (as evidenced through detailed calculations of such financial
covenants on a schedule to such certificate) as of August 31, 2004.
(r) New Convertible Notes. The Borrower shall have received Net Cash
Proceeds from the issuance of the New Convertible Notes in an amount of
not less than $48,500,000, on terms and conditions and pursuant to
documentation satisfactory in all respects to the Administrative Agent and
such Net Cash Proceeds shall have been used to redeem a like amount (less
any premium and fees) of the 2007 Convertible Notes.
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(s) Equity Issuance. The Borrower shall (i) have received Net Cash
Proceeds from a public equity issuance in an amount of not less than
$95,000,000, on terms and conditions and pursuant to documentation
satisfactory in all respects to the Administrative Agent and (ii) deposit
with the Administrative Agent or a Lender not less than $58,000,000 of
such Net Cash Proceeds to claw-back and/or tender for an aggregate amount
of $58,000,000 (including fees and expenses incurred in connection
therewith) of the 2013 Senior Subordinated Notes (the "Claw-Back") within
the applicable notice periods and on terms acceptable to the
Administrative Agent.
(t) Total Funded Debt. The Administrative Agent shall have received
evidence that, immediately after giving effect to the Transactions, Total
Funded Debt (net of the amount deposited with the Administrative Agent for
purposes of consummating the Claw-Back) is less than or equal to
$500,000,000.
(u) Consolidated EBITDAP. The Administrative Agent shall have
received evidence reasonably satisfactory thereto provided by the Credit
Parties that Consolidated EBITDAP is not less than $70,000,000 for the
twelve (12) month period ending as of August 31, 2004.
(v) Patriot Act Certificate. The Administrative Agent shall have
received a certificate satisfactory thereto, for benefit of itself and the
Lenders, provided by the Borrower that sets forth information required by
the Patriot Act (as defined in Section 9.17) including, without
limitation, the identity of the Borrower, the name and address of the
Borrower and other information that will allow the Administrative Agent or
any Lender, as applicable, to identify the Borrower in accordance with the
Patriot Act.
(w) Fees. The Administrative Agent and the Lenders shall have
received all fees, if any, owing pursuant to the Fee Letter and Section
2.7.
(x) Additional Matters. All other documents and legal matters in
connection with the Transactions shall be reasonably satisfactory in form
and substance to the Administrative Agent and its counsel.
SECTION 4.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
The obligation of each Lender to make any Extension of Credit (other than
the obligation of each Lender to fund its portion of a Mandatory LOC Borrower or
a Mandatory Swingline Borrower, which shall be governed by the terms of Section
2.2 and Section 2.3, respectively) hereunder is subject to the satisfaction of
the following conditions precedent on the date of making such Extension of
Credit:
(a) Representations and Warranties. The representations and
warranties made by the Credit Parties herein, in the Security Documents or
which are contained in any certificate furnished at any time under or in
connection herewith (i) that contain a materiality qualification shall be
true and correct on and as of the date of such Extension
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of Credit as if made on and as of such date (except for those which
expressly relate to an earlier date) and (ii) that do not contain a
materiality qualification shall be true and correct in all material
respects on and as of the date of such Extension of Credit as if made on
and as of such date (except for those which expressly relate to an earlier
date).
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such date or after giving effect
to the Extension of Credit to be made on such date unless such Default or
Event of Default shall have been waived in accordance with this Credit
Agreement.
(c) Compliance with Commitments. Immediately after giving effect to
the making of any such Extension of Credit (and the application of the
proceeds thereof), (i) the sum of the aggregate principal amount of
outstanding Revolving Loans plus outstanding Swingline Loans plus
outstanding Revolving LOC Obligations shall not exceed the Revolving
Committed Amount then in effect, (ii) the Revolving LOC Obligations shall
not exceed the Revolving LOC Committed Amount, (iii) the Swingline Loans
shall not exceed the Swingline Committed Amount and (iv) the sum of the
aggregate principal amount of the outstanding Term Loans plus outstanding
Credit-Linked LOC Obligations shall not exceed the Credit-Linked Committed
Amount.
(d) Additional Conditions to Revolving Loans. If such Loan is made
pursuant to Section 2.1, all conditions set forth in such Section shall
have been satisfied.
(e) Additional Conditions to Revolving Letters of Credit. If such
Extension of Credit is made pursuant to Section 2.2, all conditions set
forth in such Section shall have been satisfied.
(f) Additional Conditions to Swingline Loans. If such Loan is made
pursuant to Section 2.3, all conditions set forth in such Section shall
have been satisfied.
(g) Additional Conditions to Credit-Linked Letters of Credit. If
such Extension of Credit is made pursuant to Section 2.5, all conditions
set forth in such Section shall have been satisfied.
Each request for an Extension of Credit and each acceptance by the
Borrower of any such Extension of Credit shall be deemed to constitute a
representation and warranty by the Borrower as of the date of such Extension of
Credit that the applicable conditions in paragraphs (a) through (g) of this
Section have been satisfied.
ARTICLE V
AFFIRMATIVE COVENANTS
The Credit Parties hereby covenant and agree that on the Closing Date, and
thereafter for so long as this Credit Agreement is in effect and until the
Commitments have terminated and the
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Credit Party Obligations under the Credit Documents have been paid in full, the
Credit Parties shall, and shall cause each of their Subsidiaries to:
SECTION 5.1 FINANCIAL STATEMENTS.
Furnish to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available after the end
of each fiscal year of the Borrower (commencing with the fiscal year
ending November 30, 2004), but in any event on or before the earlier of
(i) the date the Borrower is required to file its annual financial
statements on Form 10-K with the SEC and (ii) the date that is ninety (90)
days after the end of such fiscal year, a copy of (A) the Borrower's
annual financial statements on Form 10-K as filed with the SEC or (B) the
Consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such fiscal year and the related
Consolidated statements of income and retained earnings and of cash flows
of the Borrower and its consolidated Subsidiaries for such year, audited
by a firm of independent certified public accountants reasonably
acceptable to the Administrative Agent, setting forth in each case in
comparative form the figures for the preceding fiscal year, reported on
without a "going concern" or like qualification or exception, or
qualification indicating that the scope of the audit was inadequate to
permit such independent certified public accountants to certify such
financial statements without such qualification;
(b) Quarterly Financial Statements. As soon as available after the
end of each of the first three fiscal quarters of the Borrower, but in any
event on or before the earlier of (i) the date the Borrower is required to
file its quarterly financial statements on Form 10-Q with the SEC and (ii)
the date that is forty-five (45) days after the end of such fiscal
quarter, a copy of (A) the Borrower's quarterly financial statements on
Form 10-Q as filed with the SEC or (B) a company-prepared Consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the
end of such period and related company-prepared Consolidated statements of
income and retained earnings and of cash flows for the Borrower and its
consolidated Subsidiaries for such quarterly period and for the portion of
the fiscal year ending with such period, in each case setting forth in
comparative form the figures for the corresponding period or periods of
the preceding fiscal year (subject to normal recurring year-end audit
adjustments); and
(c) Annual Financial Plans. As soon as practicable and in any event
within sixty (60) days after the end of each fiscal year, a Consolidated
budget and cash flow projections prepared on a quarterly basis of the
Borrower and its Subsidiaries for the following fiscal year, in form and
detail reasonably acceptable to the Administrative Agent, such budget to
be prepared by the Borrower in a manner consistent with GAAP and to
include an operating and capital budget and a summary of the material
assumptions made in the preparation of such budget. Such budget shall be
accompanied by a certificate of the treasurer or chief financial officer
of the Borrower to the effect that the budgets and other financial data
are based on reasonable estimates and assumptions, all of which such
officer believes are fair in light of the conditions which existed at the
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time the budget was made, have been prepared on the basis of the
assumptions stated therein, and reflect, as of the time so furnished, the
reasonable estimate of the Borrower and its Subsidiaries of the budgeted
results of the operations and other information budgeted therein;
all such financial statements referred to in subsections (a) and (b) above shall
(i) fairly present in all material respects the financial condition and results
from operations of the entities and for the periods specified and to be prepared
in reasonable detail and in accordance with GAAP (subject, in the case of
interim statements, to normal recurring year-end audit adjustments) applied
consistently throughout the periods reflected therein and further accompanied by
a description of, and an estimation of the effect on the financial statements on
account of, any change in the application of accounting principles as provided
in Section 1.3, if applicable and (ii) be deemed delivered for purposes of the
Section 5.1 when such financial statements are delivered to the SEC.
SECTION 5.2 CERTIFICATES; OTHER INFORMATION.
Furnish to the Administrative Agent and each of the Lenders, to the extent
not publicly available through filings under the Securities Exchange Act of
1934:
(a) concurrently with the delivery of the financial statements
referred to in Section 5.1(a) above, a certificate of the independent
certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial statements
referred to in Sections 5.1(a) and 5.1(b) above, a certificate of a
Responsible Officer substantially in the form of Schedule 5.2(b) (i)
stating that (A) such financial statements present fairly the financial
position of the Borrower and its consolidated Subsidiaries for the periods
indicated in conformity with GAAP applied on a consistent basis, (B) to
the knowledge of such Responsible Officer, each of the Credit Parties
during such period observed or performed in all material respects all of
its covenants and other agreements, and satisfied in all material respects
every condition, contained in this Credit Agreement to be observed,
performed or satisfied by it, and (C) such Responsible Officer has
obtained no knowledge of any Default or Event of Default except as
specified in such certificate and (ii) providing calculations in
reasonable detail required to indicate compliance with Section 5.9 as of
the last day of such period; provided that, for purposes of the first
certificate of a Responsible Officer provided after the Closing Date, such
certificate shall provide calculations in reasonable detail indicating
compliance on a pro forma basis (giving effect to the Transactions) with
the initial financial covenant levels in Section 5.9 utilizing the audited
financial statements for the Borrower's fiscal year 2004;
(c) within thirty (30) days after the same are sent, copies of all
financial statements and reports (other than those otherwise provided
pursuant to Section 5.1 and
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those which are of a promotional nature) and other financial information
which the Borrower sends to its shareholders;
(d) within ninety (90) days after the end of each fiscal year of the
Borrower, a certificate containing information regarding (i) the
calculation of Excess Cash Flow and (ii) the amount of all Asset
Dispositions, Debt Issuances, and Equity Issuances that were made during
the prior fiscal year and amounts received in connection with any Recovery
Event during the prior fiscal year;
(e) promptly upon receipt thereof, a copy or summary of any other
report, or "management letter" submitted or presented by independent
accountants to the Borrower or any of its Subsidiaries in connection with
any annual, interim or special audit of the books of such Person;
(f) promptly upon their becoming available, copies of any material
non-routine correspondence or official notices received by the Credit
Parties or any of their Subsidiaries from any federal, state or local
governmental authority which regulates the operations of the Credit
Parties and their Subsidiaries; and
(g) promptly, such additional financial and other information as the
Administrative Agent, on behalf of any Lender, may from time to time
reasonably request.
Documents required to be delivered pursuant to Section 5.1(a) or Section
5.1(b) may be delivered electronically and if so delivered, shall be
deemed to have been delivered on the date received by the Administrative
Agent by electronic mail with all relevant attachments. The Administrative
Agent may post such documents on the Borrower's behalf on
IntraLinks/IntraAgency or another relevant website, if any, to which each
Lender and the Administrative Agent have access (whether a commercial,
third-party website or whether sponsored by the Administrative Agent);
provided that the Borrower shall deliver paper copies of such documents to
the Administrative Agent upon its request. Notwithstanding anything
contained herein, (A) the Borrower shall be entitled to deliver the
compliance certificate required by Section 5.2(b) by electronic mail and
if so delivered shall be deemed to have been delivered on the date
received by the Administrative Agent by electronic mail with all relevant
attachments, and (B) whether or not delivery of any compliance certificate
required by Section 5.2(b) is effected pursuant to the preceding clause
(A), the Borrower shall be required to provide paper copies of the
compliance certificates required by Section 5.2(b) to the Administrative
Agent.
SECTION 5.3 PAYMENT OF TAXES; OTHER OBLIGATIONS; PERFORMANCE OF CERTAIN
OTHER AGREEMENTS.
Pay, discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, in accordance with industry practice
(subject, where applicable, to specified grace periods) all its material taxes
(Federal, state, local and any other taxes) and
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other obligations and liabilities of whatever nature and any additional costs
that are imposed as a result of any failure to so pay, discharge or otherwise
satisfy such taxes, obligations and liabilities, except when the amount or
validity of any such taxes, obligations and liabilities is currently being
contested in good faith by appropriate proceedings and reserves, if applicable,
in conformity with GAAP with respect thereto have been provided on the books of
the Credit Parties. Except as otherwise provided below, each Credit Party shall
faithfully keep and perform, or cause to be kept and performed, all of the
covenants, conditions, and agreements contained in each material lease
(including any equipment lease), rental agreement, management contract,
franchise agreement, construction contract, technical services agreement or
other material contract, license or permit, now or hereafter existing, on the
part of such Credit Party to be kept and performed with respect to such Person's
real property subject to any Mortgage Instrument (including performance of all
covenants to be performed under any and all leases of such real property or any
part thereof) and shall at all times use commercially reasonable efforts to
enforce, with respect to each other party to said agreements, all obligations,
covenants and agreements by such other party to be performed thereunder;
provided that a Credit Party shall not have any obligation under this Section
5.3 unless such Credit Party's performance or breach of its obligations with
respect to any such covenants, conditions or agreements could reasonably be
expected to have a Material Adverse Effect. Subject to the terms of Section 6.8,
nothing in this Section 5.3 should be interpreted or construed to impose any
limit on the ability of any Credit Party to modify, amend or terminate any such
agreements without prior notice to or consent of the Agent or the Lenders, so
long as any such modification, amendment or termination could not reasonably be
expected to have a Material Adverse Effect. In the event of any conflict between
the provisions of this Section 5.3 and the provisions of any Mortgage
Instrument, the provisions of this Section 5.3 shall control.
SECTION 5.4 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE.
Continue to engage in business of the same general type as now conducted
by it on the Closing Date and preserve, renew and keep in full force and effect
its existence and good standing take all reasonable action to maintain all
rights, privileges and franchises necessary in the normal conduct of its
business; comply with all Contractual Obligations and Requirements of Law
applicable to it except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
SECTION 5.5 MAINTENANCE OF PROPERTY; INSURANCE.
(a) Keep all material property useful and necessary in its business
in good working order and condition (ordinary wear and tear and
obsolescence excepted).
(b) Maintain with financially sound and reputable insurance
companies insurance on all its property (including without limitation its
tangible Collateral) in at least such amounts and against at least such
risks as are usually insured against in the same geographical area by
companies engaged in the same or a similar business (including, without
limitation, business interruption insurance); and furnish to the
Administrative Agent, upon written request, full information as to the
insurance carried. The Administrative Agent shall be named as loss payee
or mortgagee, as its interest may
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appear, and the Administrative Agent shall be named as an additional
insured with respect to any such insurance providing coverage in respect
of any Collateral, and each provider of any such insurance shall agree, by
endorsement upon the policy or policies issued by it or by independent
instruments furnished to the Administrative Agent, that it will give the
Administrative Agent thirty (30) days prior written notice before any such
policy or policies shall be altered or canceled, and that no act or
default of any Credit Party or any other Person shall affect the rights of
the Administrative Agent or the Lenders under such policy or policies.
(c) In case of any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party
shall promptly give written notice thereof to the Administrative Agent
generally describing the nature and extent of such damage or destruction.
In case of any loss, damage to or destruction of the Collateral of any
Credit Party or any part thereof, such Credit Party, whether or not the
insurance proceeds, if any, received on account of such damage or
destruction shall be sufficient for that purpose, at such Credit Party's
cost and expense, will promptly repair or replace the Collateral of such
Credit Party so lost, damaged or destroyed unless such Credit Party shall
have reasonably determined that such repair or replacement of the affected
Collateral is not economically feasible or is not deemed in the best
business interest of such Credit Party.
SECTION 5.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS.
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent or any Lender, the Administrative Agent or any Lender to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records at any reasonable time, upon reasonable notice and as
often as may reasonably be desired, and to discuss the business, operations,
properties and financial and other condition of the Credit Parties with officers
and employees of the Credit Parties and with their independent certified public
accountants (a representative of the Borrower may be present at any such meeting
with the independent certified public accountants).
SECTION 5.7 NOTICES.
(a) Promptly after any Credit Party obtains actual knowledge
thereof, provide written notice to the Administrative Agent (which shall
transmit such notice to each Lender as soon as practicable) of the
occurrence of any Default or Event of Default.
(b) Promptly (but in no event later than two (2) Business Days after
any Credit Party obtains actual knowledge thereof) provide written notice
of the following to the Administrative Agent (which shall transmit such
notice to each Lender as soon as practicable):
(i) the occurrence of any default or event of default under
any Contractual Obligation of any of the Credit Parties which could
reasonably be
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expected to have a Material Adverse Effect or involve a monetary
claim that could reasonably be expected to result in liability to
the Credit Parties in excess of $5,000,000;
(ii) any litigation, or any investigation or proceeding (A)
affecting any of the Credit Parties which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect or
(B) affecting or with respect to this Credit Agreement or any other
Credit Document;
(iii) (A) the occurrence or expected occurrence of any
Reportable Event with respect to any Plan, a failure to make any
material required contribution to a Plan, the creation of any Lien
in favor of the PBGC (other than a Permitted Lien) or a Plan or any
withdrawal from, or the termination, Reorganization or Insolvency
of, any Multiemployer Plan or (B) the institution of proceedings or
the taking of any other action by the PBGC or any Credit Party or
any Commonly Controlled Entity or any Multiemployer Plan with
respect to the withdrawal from, or the terminating, Reorganization
or Insolvency of, any Plan;
(iv) any notice of any material violation received by any
Credit Party from any Governmental Authority including, without
limitation, any notice of material violation of Environmental Laws;
(v) any labor controversy that has resulted in, or threatens
to result in, a strike or other work action against any Credit Party
which could reasonably be expected to have a Material Adverse
Effect;
(vi) any attachment, judgment, lien, levy or order exceeding
$2,500,000 shall be assessed against any Credit Party other than
Permitted Liens; and
(vii) any other development or event which could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement
of a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower proposes to take with respect
thereto. In the case of any notice of a Default or Event of Default, the
Borrower shall specify that such notice is a Default or Event of Default notice
on the face thereof.
SECTION 5.8 ENVIRONMENTAL LAWS.
(a) Comply in all material respects with all applicable
Environmental Laws and obtain and comply in all material respects with and
maintain any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws except, in each case, to
the extent that failure to do so could not reasonably be expected to have
a Material Adverse Effect.
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(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are being contested
in good faith by appropriate proceedings and the pendency of such
proceedings could not reasonably be expected to have a Material Adverse
Effect.
(c) Defend, indemnify and hold harmless the Administrative Agent and
the Lenders, and their respective employees, agents, officers and
directors, from and against any and all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature known or unknown, contingent or otherwise, arising out of, or in
any way relating to the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of the Credit
Parties or the Properties, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
reasonable attorney's and consultant's fees, investigation and laboratory
fees, response costs, court costs and litigation expenses, except to the
extent that any of the foregoing arise out of the gross negligence,
unlawful acts or willful misconduct of the party seeking indemnification
therefor. The agreements in this paragraph shall survive repayment of the
Notes and all other amounts payable hereunder.
SECTION 5.9 FINANCIAL COVENANTS.
Commencing on the day immediately following the Closing Date, each of the
Credit Parties shall, and shall cause each of its Subsidiaries to, comply with
the following financial covenants (which shall be calculated on a quarterly
basis in connection with the delivery of the quarterly compliance certificate
required by Section 5.2(b)):
(a) Leverage Ratio. At all times, the Leverage Ratio during the
following periods shall be less than or equal to:
Period Maximum Ratio
------------------------------------------ -------------
Closing Date through May 31, 2005 8.25 to 1.0
June 1, 2005 through November 30, 2005 7.50 to 1.0
December 1, 2005 through November 30, 2006 6.75 to 1.0
December 1, 2006 through November 30, 2007 6.00 to 1.0
December 1, 2007 and thereafter 5.50 to 1.0
(b) Senior Leverage Ratio. At all times, the Senior Leverage Ratio
during the following periods shall be less than or equal to:
Period Maximum Ratio
------------------------------------------ -------------
Closing Date through May 31, 2005 3.0 to 1.0
June 1, 2005 and thereafter 2.5 to 1.0
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(c) Fixed Charge Coverage Ratio. At all times, the Fixed Charge
Coverage Ratio shall be greater than or equal:
Period Maximum Ratio
------------------------------------------ -------------
Closing Date through May 31, 2005 1.05 to 1.0
June 1, 2005 through November 30, 2005 1.10 to 1.0
December 1, 2005 through November 30, 2006 1.15 to 1.0
December 1, 2006 and thereafter 1.20 to 1.0
(d) Interest Coverage Ratio. At all times, the Interest Coverage
Ratio shall be greater than or equal:
Period Maximum Ratio
------------------------------------------ -------------
Closing Date through November 30, 2006 2.00 to 1.0
December 1, 2006 and thereafter 2.25 to 1.0
Notwithstanding the above, the parties hereto acknowledge and agree that,
for purposes of all calculations made in determining compliance for any
applicable period with the financial covenants set forth in this Section 5.9,
(i) after consummation of any Permitted Acquisition, (A) income statement items
and other balance sheet items (whether positive or negative) attributable to the
Target acquired in such transaction shall be included in such calculations to
the extent relating to such applicable period, subject to adjustments mutually
acceptable to the Borrower and the Administrative Agent, and (B) Indebtedness of
a Target which is retired in connection with a Permitted Acquisition shall be
excluded from such calculations and deemed to have been retired as of the first
day of such applicable period and (ii) after any asset sale permitted by Section
6.4(a)(viii)-(xi), (I) income statement items, cash flow statement items and
other balance sheet items (whether positive or negative) attributable to the
property or assets disposed of shall be excluded in such calculations to the
extent relating to such applicable period, subject to adjustments mutually
acceptable to the Borrower and the Administrative Agent and (II) Indebtedness
that is repaid with the proceeds of such asset sale shall be excluded from such
calculations and deemed to have been repaid as of the first day of such
applicable period it being understood and agreed that, upon the consummation of
the AFC Sale, all Consolidated Capital Expenditures of Aerojet Fine Chemicals
LLC shall be excluded from the calculation of the financial covenants set forth
in this Section 5.9.
SECTION 5.10 ADDITIONAL GUARANTORS.
The Credit Parties will cause each of their Material Domestic
Subsidiaries, whether newly formed, after acquired or otherwise existing, to
promptly (and in any event within thirty (30) days after such Material Domestic
Subsidiary is formed or acquired (or such longer period of time as agreed to by
the Administrative Agent in its reasonable discretion)) become a Guarantor
hereunder by way of execution of a Joinder Agreement. In connection therewith,
the Credit Parties shall give notice to the Administrative Agent not less than
ten (10) days prior to creating a Material Domestic Subsidiary (or such shorter
period of time as agreed to by the Administrative Agent in its reasonable
discretion), or acquiring the Capital Stock of any other Person. The Credit
Party Obligations shall be secured by, among other things, a first priority
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perfected security interest in the Collateral of such new Guarantor and a pledge
of 100% of the Capital Stock of such new Guarantor and its Domestic Subsidiaries
and 65% (or such higher percentage that would not result in adverse tax
consequences for the Borrower or such new Guarantor) of the voting Capital Stock
and 100% of the non-voting Capital Stock of its first-tier Foreign Subsidiaries.
In connection with the foregoing, the Credit Parties shall deliver to the
Administrative Agent, with respect to each new Guarantor to the extent
applicable, substantially the same documentation required pursuant to Sections
4.1(b)-(f) and 5.12 and such other documents or agreements as the Administrative
Agent may reasonably request.
SECTION 5.11 COMPLIANCE WITH LAW.
Each Credit Party will, and will cause each of its Subsidiaries to, comply
with all laws, rules, regulations and orders, and all applicable restrictions
imposed by all Governmental Authorities, applicable to it and its property if
noncompliance with any such law, rule, regulation, order or restriction could
reasonably be expected to have a Material Adverse Effect.
SECTION 5.12 PLEDGED ASSETS.
(a) Each Credit Party will cause 100% of the Capital Stock of each
of its direct or indirect Material Domestic Subsidiaries and 65% of the
Capital Stock of each of its first-tier Material Foreign Subsidiaries to
be subject at all times to a first priority, perfected Lien in favor of
the Administrative Agent pursuant to the terms and conditions of the
Security Documents or such other security documents as the Administrative
Agent shall reasonably request.
(b) If, subsequent to the Closing Date, a Credit Party shall acquire
any real property or any securities, instruments, chattel paper or other
personal property required for perfection to be delivered to the
Administrative Agent as Collateral hereunder or under any of the Security
Documents, the Borrower shall promptly (and in any event within three (3)
Business Days) after any Responsible Officer of a Credit Party acquires
knowledge of same notify the Administrative Agent of same. Each Credit
Party shall, and shall cause each of its Subsidiaries to, take such action
at its own expense as reasonably requested by the Administrative Agent
(including, without limitation, any of the actions described in Section
4.1(d) or (e) hereof) to ensure that the Administrative Agent has a first
priority perfected Lien to secure the Credit Party Obligations (subject to
Permitted Liens) in (i) all personal property of the Credit Parties
located in the United States (including, without limitation, take all
actions necessary under the Federal Assignment of Claims Act to ensure the
Administrative Agent has a first priority perfected Lien on any government
receivables), (ii) to the extent deemed to be material by the
Administrative Agent or the Required Lenders in its or their reasonable
discretion, all other personal property of the Credit Parties, subject in
each case only to Permitted Liens, and (iii) to the extent deemed to be
material by the Administrative Agent or the Required Lenders in its or
their reasonable discretion, such real property of the Credit Parties
located in the United States as deemed material. Each Credit Party shall,
and shall cause each of its Subsidiaries to, adhere to the covenants
regarding the location of personal property as set forth in the Security
Documents.
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SECTION 5.13 COVENANTS REGARDING PATENTS, TRADEMARKS AND COPYRIGHTS.
(a) Concurrently with the delivery of quarterly and annual financial
statements of the Borrower pursuant to Sections 5.1 and 5.2 hereof, the
Borrower shall notify the Administrative Agent if it knows or has reason
to know that any application, letters patent or registration relating to
any material Patent, Patent License, Trademark or Trademark License of the
Credit Parties or any of their Subsidiaries may become abandoned, 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 or any court)
regarding the Borrower's or any of its Subsidiary's ownership of any
material Patent or Trademark, its right to patent or register the same, or
to enforce, keep and maintain the same, or its rights under any material
Patent License or Trademark License.
(b) Concurrently with the delivery of quarterly and annual financial
statements of the Borrower pursuant to Sections 5.1 and 5.2 hereof, the
Borrower shall notify the Administrative Agent after it knows or has
reason to know of any adverse determination or development (including,
without limitation, the institution of, or any such determination or
development in, any proceeding in any court) regarding any material
Copyright or Copyright License of the Credit Parties or any of their
Subsidiaries, whether (i) such material Copyright or Copyright License may
become invalid or unenforceable prior to its expiration or termination, or
(ii) the Borrower's or any of its Subsidiary's ownership of such material
Copyright, its right to register the same or to enforce, keep and maintain
the same, or its rights under such material Copyright License, may become
affected.
(c) (i) Concurrently with the delivery of quarterly and annual
financial statements of the Borrower pursuant to Sections 5.1 and
5.2 hereof, the Borrower shall notify the Administrative Agent of
any filing by any Credit Party or any of its Subsidiaries, either
itself or through any agent, employee, licensee or designee, of any
application for registration of any Intellectual Property (other
than Intellectual Property of de minimus value) with the United
States Copyright Office or United States Patent and Trademark Office
or any similar office or agency in any other country or any
political subdivision thereof.
(ii) Concurrently with the delivery of quarterly and annual
financial statements of the Borrower pursuant to Sections 5.1 and
5.2 hereof, the Borrower shall provide the Administrative Agent and
its counsel a complete and correct list in all material respects of
all new Copyright Licenses, Patent Licenses and Trademark Licenses
(other than Copyright Licenses, Patent Licenses and Trademark
Licenses of de minimus value) not previously disclosed on Schedule
3.16 or otherwise disclosed to the Administrative Agent pursuant to
this Section 5.13(c)(ii).
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(iii) Upon request of the Administrative Agent, the Borrower
shall execute and deliver any and all agreements, instruments,
documents, and papers as the Administrative Agent may reasonably
request to evidence the Administrative Agent's security interest in
the Intellectual Property and the general intangibles (other than
Intellectual Property of de minimus value) referred to in clauses
(i) and (ii), including, without limitation, the goodwill of the
Borrower or its Subsidiaries relating thereto or represented thereby
(or such other Intellectual Property or the general intangibles
relating thereto or represented thereby as the Administrative Agent
may reasonably request).
(d) The Credit Parties and their Subsidiaries will take all
necessary actions, including, without limitation, in any proceeding before
the United States Patent and Trademark Office or the United States
Copyright Office, to maintain each material item of Intellectual Property
of the Credit Parties and their Subsidiaries, including, without
limitation, payment of maintenance fees, filing of applications for
renewal, affidavits of use, affidavits of incontestability and opposition,
interference and cancellation proceedings; provided that the Credit
Parties shall have the right to abandon any item of Intellectual Property
which the Borrower determines is no longer of significant value or useful
or necessary to the business of the Borrower and its Subsidiaries.
(e) In the event that any Credit Party becomes aware that any
material Intellectual Property is infringed, misappropriated or diluted by
a third party in any material respect, the Credit Parties shall notify the
Administrative Agent promptly after it learns thereof and shall, unless
the Credit Parties shall reasonably determine that such Intellectual
Property is not material to the business of the Credit Parties and their
Subsidiaries taken as a whole or as to which the Credit Parties reasonably
conclude that the cost of such proceeding or its likelihood of success
does not justify its prosecution, promptly ▇▇▇ for infringement,
misappropriation or dilution and to recover any and all damages for such
infringement, misappropriation or dilution, and take such other actions as
the Credit Parties shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property.
SECTION 5.14 FURTHER ASSURANCES; POST-CLOSING COVENANTS.
(a) Further Assurances. Upon the reasonable request of the
Administrative Agent, promptly perform or cause to be performed any and
all acts and execute or cause to be executed any and all documents for
filing under the provisions of the Uniform Commercial Code or any other
Requirement of Law which are necessary or advisable to maintain in favor
of the Administrative Agent, for the benefit of the Secured Parties, Liens
on the Collateral that are duly perfected in accordance with the
requirements of, or the obligations of the Credit Parties under, the
Credit Documents and all applicable Requirements of Law.
(b) Landlord Waiver. Within sixty (60) days after the Closing Date
(or such extended period of time as agreed to by the Administrative
Agent), the Credit Parties shall use commercially reasonable efforts to
deliver to the Administrative Agent a
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landlord waiver with respect to the real property located in Camden,
Arizona executed by the landlord on such real property, such landlord
waiver to be in form and substance reasonably satisfactory to the
Administrative Agent.
(c) Account Control Agreements. Within sixty (60) days after the
Closing Date (or such extended period of time as agreed to by the
Administrative Agent), the Credit Parties shall use commercially
reasonable efforts to deliver to the Administrative Agent, to the extent
not delivered to the Administrative Agent on or prior to the Closing Date,
such duly executed account control agreements as requested by the
Administrative Agent with respect to Collateral for which a control
agreement is required for perfection of the Administrative Agent's
security interest under the Uniform Commercial Code.
(d) SNDA. Within sixty (60) days after the Closing Date (or such
extended period of time as agreed to by the Administrative Agent), the
Credit Parties shall use commercially reasonable efforts to deliver to the
Administrative Agent a subordination, nondisturbance and attornment
agreement with respect to the real property located in Redmond, Washington
executed by the tenant on such real property, such agreement to be in form
and substance reasonably satisfactory to the Administrative Agent.
(e) Intellectual Property. Within ninety (90) days after the Closing
Date (or such extended period of time as agreed to by the Administrative
Agent), to the extent required by the Administrative Agent, the Borrower
shall provide evidence to the Administrative Agent, in form and substance
reasonably satisfactory to the Administrative Agent, that all chain of
title issues with respect to the material Intellectual Property of the
Credit Parties have been corrected in the appropriate records of the
United States Patent and Trademark Office and the United States Copyright
Office.
ARTICLE VI
NEGATIVE COVENANTS
The Credit Parties hereby covenant and agree that on the Closing Date, and
thereafter for so long as this Credit Agreement is in effect and until the
Commitments have terminated and the Credit Party Obligations under the Credit
Documents have been paid in full, that:
SECTION 6.1 INDEBTEDNESS.
The Credit Parties will not, nor will they permit any Subsidiary to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness of the Credit Parties and their Subsidiaries
existing as of the Closing Date as set forth on Schedule 6.1(b) and any
renewals, refinancings or extensions
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thereof; provided, however, that (i) subject to clause (ii) below, the
principal amount of such Indebtedness as renewed, refinanced or extended
(as determined as of the date of the renewal, refinancing or extension of
such Indebtedness in accordance with GAAP), does not exceed the principal
amount of the Indebtedness refinanced thereby on such date plus costs and
fees incurred in connection with such renewal, refinancing or extension,
(ii) if such Indebtedness is owed by a Credit Party to a Subsidiary that
is not a Credit Party, such Indebtedness shall not be repaid in cash or
Cash Equivalents and shall not be renewed, extended, refinanced or
replaced, (iii) the Weighted Average Life to Maturity of such Indebtedness
is not decreased and (iv) in the case of any such Indebtedness, as
renewed, refinanced or extended, which is in excess of $5,000,000, such
Indebtedness is upon terms and subject to documentation which is in form
and substance reasonably satisfactory to the Administrative Agent;
(c) Indebtedness incurred or acquired after the Closing Date
consisting of Capital Leases or Indebtedness incurred to provide all or a
portion of the purchase price or cost of construction of an asset;
provided that (i) such Indebtedness when incurred (A) does not exceed one
hundred percent (100%) of the fair market value of the asset subject to
such purchase money financing or Capital Lease and (B) is not less than
seventy percent (70%) of the fair market value of such asset; (ii) no such
Indebtedness shall be refinanced for a principal amount in excess of the
principal balance outstanding thereon at the time of such refinancing; and
(iii) the aggregate amount of such Indebtedness outstanding at any time,
together with Indebtedness outstanding and permitted by Section 6.1(d)
(without double counting) shall not exceed $15,000,000;
(d) Indebtedness of a Subsidiary of the Borrower issued and
outstanding on or prior to the date on which such Subsidiary was acquired
by the Borrower or a Subsidiary of the Borrower in a transaction
constituting a Permitted Acquisition (other than Indebtedness issued as
consideration in, or to provide all or any portion of the funds utilized
to consummate such Permitted Acquisition) and any extension, renewal or
replacement thereof (including costs and fees incurred in connection with
such extension, renewal or replacement); provided, that the aggregate
amount of such Indebtedness outstanding at any time shall not exceed
$10,000,000;
(e) Indebtedness of the Credit Parties and their Subsidiaries
pursuant to the Existing Subordinated Notes and the New Convertible Notes;
provided that the Existing Subordinated Notes and the New Convertible
Notes may be refinanced including costs and fees or extended so long as
(i) no Default or Event of Default shall have occurred and be continuing
or would result therefrom, (ii) the principal amount of such Existing
Subordinated Notes will not be increased in connection with such
refinancing or extension (except by an amount equal to the costs and fees
incurred in connection with such refinancing or extension), (iii) the
terms of the refinanced or extended notes shall be reasonably satisfactory
to the Administrative Agent and shall be substantially similar or more
favorable to the Credit Parties and their Subsidiaries (and the
subordination terms thereof shall be substantially similar or more
favorable to the Lenders) than the Existing Subordinated Notes or the New
Convertible Notes, (iv) the maturity date of such refinanced or extended
notes shall be at least six (6) months after the Credit-Linked
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Maturity Date and (v) the Weighted Average Life to Maturity of such
refinanced or extended notes is not decreased;
(f) unsecured Indebtedness incurred by the Credit Parties and owed
to any Credit Party or any of its Subsidiaries; provided, however, that in
the case of such intercompany Indebtedness consisting of a loan or advance
by a Credit Party to another Credit Party, each such loan shall be
evidenced by an Intercompany Note payable to the Credit Party, in form and
substance satisfactory to Administrative Agent, which Intercompany Notes
shall be delivered and pledged to the Administrative Agent as part of the
Collateral;
(g) Indebtedness and obligations owing under Secured Hedging
Agreements and other Hedging Agreements entered into in order to manage
existing or anticipated interest rate or currency exchange rate risks and
not for speculative purposes;
(h) Indebtedness of the Credit Parties and their Subsidiaries
consisting of unsecured Guaranty Obligations incurred to satisfy bonding
obligations not in excess of $5,000,000 at any one time which arise in the
ordinary course of business;
(i) Indebtedness of the Borrower consisting of unsecured Guaranty
Obligations in favor of the United States Environmental Protection Agency
which are incurred on behalf of Aerojet in connection with environmental
remediation; provided, that such Guaranty Obligations permitted under this
Section 6.1(k) shall not at any time exceed $120,000,000;
(j) additional unsecured Indebtedness for money borrowed not
otherwise covered by clauses (a) through (l) above; provided that the
aggregate outstanding principal amount of all such other Indebtedness
permitted under this Section 6.1(i) shall in no event exceed $20,000,000
at any time; and
(k) Guaranty Obligations in respect of Indebtedness of a Credit
Party to the extent such Indebtedness is permitted to exist or be incurred
pursuant to this Section 6.1 and any renewal, refinancing or extension of
such Guaranty Obligations to the extent such Indebtedness is permitted to
be renewed, refinanced or extended hereunder; provided that if the
Indebtedness with respect to which such Guaranty Obligations relate is
unsecured, such Guaranty Obligations shall also be unsecured.
SECTION 6.2 LIENS.
The Credit Parties will not, nor will they permit any Subsidiary to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of their respective property or assets of any kind (whether real or personal,
tangible or intangible), whether now owned or hereafter acquired, except for
Permitted Liens.
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SECTION 6.3 NATURE OF BUSINESS.
The Credit Parties will not, nor will they permit any Subsidiary to, alter
the character of the business of the Credit Parties and their Subsidiaries,
taken as a whole, in any material respect from that conducted as of the Closing
Date (including the development and sale of real estate) other than the changes
in business, if any, related to the AFC Sale.
SECTION 6.4 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
The Credit Parties will not, nor will they permit any Subsidiary to:
(a) dissolve, liquidate or wind up its affairs, consolidate or merge
with another Person, or sell, transfer, lease or otherwise dispose of its
property or assets or agree to do so at a future time except the
following, without duplication, shall be expressly permitted:
(i) Specified Sales;
(ii) the disposition of property or assets as a result of a
Recovery Event to the extent the Net Cash Proceeds therefrom are
used to repay Loans pursuant to Section 2.9(b)(vi) or repair or
replace damaged property or to purchase or otherwise acquire new
assets or property in accordance with the terms of Section
2.9(b)(vi);
(iii) the sale, lease or transfer of property or assets from a
Credit Party to another Credit Party; provided that prior to or
simultaneously with any such sale, lease or transfer, all actions
required by the Administrative Agent shall be taken to insure the
continued perfection and priority of the Administrative Agent's
Liens on such property and assets;
(iv) the consolidation, liquidation or merger of a Credit
Party into another Credit Party or any Subsidiary into a Credit
Party; provided that (A) prior to or simultaneously with any such
consolidation, liquidation or merger, all actions required by the
Administrative Agent shall be taken to insure the continued
perfection and priority of the Administrative Agent's Liens on the
property and assets of each such Credit Party and (B) if such
consolidation, liquidation or merger involves the Borrower, the
Borrower shall be the surviving entity;
(v) the dissolution, liquidation or winding up of a Subsidiary
that is not a Credit Party; provided that prior to or simultaneously
with any such dissolution, liquidation or winding up, all assets of
such Subsidiary are transferred to a Credit Party or a Subsidiary
thereof;
(vi) the termination of any Hedging Agreement permitted
pursuant to Section 6.1;
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(vii) the Borrower and its Subsidiaries may sell or discount,
in each case without recourse and in the ordinary course of
business, accounts receivable arising in the ordinary course of
business (A) which are overdue, or (B) which the Borrower or such
Subsidiary may reasonably determine are difficult or uneconomic to
collect but only in connection with the compromise or collection
thereof consistent with customary industry practice (and not as part
of any bulk sale or financing of receivables);
(viii) the Borrower and its Subsidiaries may license its
patents, trade secrets, know-how and other intellectual property
(the "Technology"); provided that such license shall be assignable
to the Administrative Agent or any assignee of the Administrative
Agent without the consent of the licensee and no such license shall
(A) transfer ownership of such Technology to any other Person or (B)
require the Borrower to pay any fees for any such use;
(ix) the AFC Sale; provided that at the time of such sale (A)
no Event of Default has occurred and is continuing and no Default or
Event of Default would result therefrom and (B) such sale is for
fair market value as determined by the board of directors of the
Borrower;
(x) Permitted Real Estate Sales;
(xi) the grant of certain rights pertaining to "Aggregates" to
Granite Construction Company pursuant to the Agreement Granting
Right to Mine Aggregates dated November 18, 2004 (the "Granite
Agreement");
(xii) the sale, transfer or other disposition of any assets
that are obsolete, worn out or no longer useful in any Credit
Party's business; and
(xiii) the sale, transfer, lease or other disposition of any
other assets, provided that the aggregate Net Cash Proceeds received
from the sale of all assets subject to this Section 6.4(a)(xi) which
are not reinvested to acquire assets to be used in such Person's
business shall not exceed $20,000,000 in any fiscal year of the
Borrower;
provided, that, with respect to subsections (i), (ii), (vii), (viii),
(ix), (xi), (xii) and (xiii) above, at least 75% of the consideration
received therefor by such Credit Party shall be in the form of cash or
Cash Equivalents; and, provided, further, that the non-cash portion of any
such consideration shall be in compliance with the provisions of Section
6.5 hereof; or
(b) purchase, lease or otherwise acquire (in a single transaction or
a series of related transactions) the property or assets of any Person
(other than purchases or other acquisitions of inventory, leases,
materials, property and equipment in the ordinary course of business,
except as otherwise limited or prohibited herein), except for
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(i) transactions permitted pursuant to Section 6.4(a), (ii) Investments
permitted pursuant to Section 6.5 and (iii) Permitted Acquisitions.
SECTION 6.5 ADVANCES, INVESTMENTS AND LOANS.
The Credit Parties will not, nor will they permit any Subsidiary to, lend
money or extend credit or make advances to any Person, or purchase or acquire
any stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any Person except for Permitted Investments.
SECTION 6.6 TRANSACTIONS WITH AFFILIATES.
The Credit Parties will not, nor will they permit any Subsidiary to, enter
into any transaction or series of transactions (other than compensation, bonus
and benefit arrangements for employees approved by the board of directors of the
Borrower, and reasonable and customary directors' fees, indemnification and
similar arrangements and payments thereunder), whether or not in the ordinary
course of business, with any officer, director, shareholder or Affiliate other
than on terms and conditions substantially as favorable as would be obtainable
in a comparable arm's-length transaction with a Person other than an officer,
director, shareholder or Affiliate.
SECTION 6.7 OWNERSHIP OF SUBSIDIARIES; RESTRICTIONS.
The Credit Parties will not, nor will they permit any Subsidiary to,
create, form or acquire any Subsidiaries, except in accordance with the terms
hereof. The Credit Parties will not sell, transfer, pledge or otherwise dispose
of any Capital Stock or other equity interests in any of its Subsidiaries, nor
will it permit any of its Subsidiaries to issue, sell, transfer, pledge or
otherwise dispose of any of their Capital Stock or other equity interests,
except in a transaction permitted by Section 6.4(a).
SECTION 6.8 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS; MATERIAL CONTRACTS;
ACCOUNTING POLICIES.
(a) No Credit Party will, nor will they permit any of its
Subsidiaries to, (i) change its fiscal year, (ii) amend, modify or change
its articles of incorporation, certificate of designation (or corporate
charter or other similar organizational document), operating agreement,
bylaws (or other similar document) or other agreements related to its
Capital Stock in any respect adverse to the interests of the Lenders
without the prior written consent of the Required Lenders, (iii) amend,
modify, cancel or terminate or fail to renew or extend (if renewable or
extendable by its terms) or permit the amendment, modification,
cancellation or termination of any of its Material Contracts in any
respect materially adverse to the interests of the Lenders without the
prior written consent of the Required Lenders, or (iv) change its state of
incorporation, organization or formation or have more than one state of
incorporation, organization or formation.
(b) The Borrower shall not, nor shall it permit any of its
Subsidiaries to make or permit to be made any change in accounting
policies affecting the presentation of
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financial statements or reporting practices from those employed by it on
the date hereof; unless (i) such change is required or permitted by GAAP
and (ii) such change is disclosed to the Lenders through the
Administrative Agent or otherwise.
SECTION 6.9 LIMITATION ON RESTRICTED ACTIONS.
The Credit Parties will not, nor will they permit any Subsidiary to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any such Person to
(a) pay dividends or make any other distributions to any Credit Party on its
Capital Stock or with respect to any other interest or participation in, or
measured by, its profits, (b) pay any Indebtedness or other obligation owed to
any Credit Party, (c) make loans or advances to any Credit Party, (d) sell,
lease or transfer any of its properties or assets to any Credit Party, or (e)
act as a Guarantor or encumber its assets to the extent required by the Credit
Documents, except (in respect of any of the matters referred to in clauses
(a)-(d) above) for such encumbrances or restrictions existing under or by reason
of (i) this Credit Agreement and the other Credit Documents, (ii) applicable law
and regulations, (iii) any document or instrument governing Indebtedness
incurred pursuant to Section 6.1(c); provided that any such restriction
contained therein relates only to the asset or assets constructed or acquired in
connection therewith, (iv) any Permitted Lien or any document or instrument
governing any Permitted Lien; provided that any such restriction contained
therein relates only to the asset or assets subject to such Permitted Lien or
(v) any such encumbrance or restriction consisting of customary non-assignment
provisions in leases or licenses restricting leasehold interests or licenses, as
applicable, entered into in the ordinary course of business.
SECTION 6.10 RESTRICTED PAYMENTS.
The Credit Parties will not, nor will they permit any Subsidiary to,
directly or indirectly, declare, order, make or set apart any sum for or pay any
Restricted Payment, except (a) to make dividends payable solely in the same
class of Capital Stock of such Person, (b) to make dividends or other
distributions payable to the Borrower (directly or indirectly through its
Subsidiaries), (c) subject to the subordination terms of such Subordinated Debt,
(i) to make regularly scheduled interest payments on the Existing Subordinated
Notes and the New Convertible Notes, (ii) so long as no Event of Default has
occurred and is continuing and no Default or Event of Default would result
therefrom, to make the Claw-Back in an amount not to exceed $58,000,000
(inclusive of all fees, expenses and premiums incurred in connection therewith)
during the ninety (90) day period immediately following the Closing Date, (iii)
so long as no Event of Default has occurred and is continuing and no Default or
Event of Default would result therefrom, to refinance the 2007 Convertible
Notes, the 2013 Senior Subordinated Notes and the 2024 Convertible Notes on
substantially similar or more favorable terms to the Lenders and on terms
reasonably satisfactory to the Administrative Agent, (iv) to redeem (with funds
other than from the Facilities) the 2007 Convertible Notes and the 2024
Convertible Notes to the extent required by the mandatory redemption provisions
of the indentures therefor as in effect on the Closing Date and (v) so long as
no Event of Default has occurred and is continuing and no Default or Event of
Default would result therefrom from and after the date when there shall be no
outstanding amounts under the Term Loan, to redeem all or a portion of the 2013
Senior Subordinated Notes with the proceeds of Asset Dispositions (in accordance
with the terms
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of the indenture for the 2013 Senior Subordinated Notes as in effect on the
Closing Date) that are not prepaid pursuant to Section 2.9(b), so long as, after
giving pro forma effect to such redemption, (x) the Unadjusted Senior Leverage
Ratio is less than 2.0 to 1.0, (y) there are no Revolving Loans outstanding and
(z) the Loan to Value Test is satisfied, (d) so long as no Event of Default has
occurred and is continuing and no Default or Event of Default would result
therefrom, to pay earnout obligations incurred as part of the consideration for
a Permitted Acquisition and (e) so long as no Default or Event of Default has
occurred and is continuing and no Default or Event of Default would result
therefrom, to repurchase Capital Stock upon the termination of employment,
death, permanent disability or retirement of employees or management in an
aggregate amount not to exceed $2,000,000 annually.
SECTION 6.11 AMENDMENT OF SUBORDINATED DEBT.
The Credit Parties will not, nor will it permit any Subsidiary to, without
the prior written consent of the Required Lenders, amend, modify, waive or
extend or permit the amendment, modification, waiver or extension of any term of
any document governing or relating to any Subordinated Debt (including, without
limitation, the Existing Subordinated Notes or the New Convertible Notes) in a
manner that is adverse to the interests of the Lenders.
SECTION 6.12 SALE LEASEBACKS.
The Credit Parties will not, nor will they permit any Subsidiary to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any lease, whether an operating lease or a Capital
Lease, of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (a) which any Credit Party or any of their Subsidiaries has
sold or transferred or is to sell or transfer to any other Person (other than
the Borrower or any of its Subsidiaries) or (b) which the Borrower or any of its
Subsidiaries intends to use for substantially the same purpose as any other
property which has been or is to be sold or transferred by the Borrower or any
of its Subsidiaries to any Person (other than the Borrower or any of its
Subsidiaries) in connection with such lease, except for such sale leasebacks in
the amount of $15,000,000 in the aggregate during the term of this Agreement.
SECTION 6.13 NO FURTHER NEGATIVE PLEDGES.
The Credit Parties will not, nor will they permit any Subsidiary to, enter
into, assume or become subject to any agreement prohibiting or otherwise
restricting the creation or assumption of any Lien upon its properties or
assets, whether now owned or hereafter acquired, or requiring the grant of any
security for such obligation if security is given for some other obligation,
except (a) pursuant to this Credit Agreement and the other Credit Documents and
(b) pursuant to any document or instrument governing Indebtedness incurred
pursuant to Section 6.1(c); provided that any such restriction contained therein
relates only to the asset or assets constructed or acquired in connection
therewith, and (c) in connection with any Permitted Lien or any document or
instrument governing any Permitted Lien; provided that any such restriction
contained therein relates only to the asset or assets subject to such Permitted
Lien.
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SECTION 6.14 ACCOUNTS.
The Credit Parties and their Subsidiaries will not maintain deposit and
securities accounts (other than pension accounts) with Persons, other than the
Administrative Agent, the Lenders and other Persons that have entered into a
control agreement with the Administrative Agent, in form and substance
satisfactory to the Administrative Agent, with respect to the accounts held with
such Person, that contain an aggregate balance at any time of more than
$10,000,000.
ARTICLE VII
EVENTS OF DEFAULT
SECTION 7.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment Default. The Borrower shall fail to pay any principal on
any Loan or Note when due (whether at maturity, by reason of acceleration
or otherwise) in accordance with the terms thereof or hereof; or the
Borrower shall fail to reimburse any Revolving Issuing Lender or any
Credit-Linked Issuing Lender, as appropriate, for any LOC Obligations or
any Credit-Linked LOC Obligations when due (whether at maturity, by reason
of acceleration or otherwise) in accordance with the terms hereof; or the
Borrower shall fail to pay any interest on any Loan or Note or any fee or
other amount payable hereunder when due (whether at maturity, by reason of
acceleration or otherwise) in accordance with the terms thereof or hereof
and such failure shall continue unremedied for three (3) Business Days; or
any Guarantor shall fail to pay on the Guaranty in respect of any of the
foregoing or in respect of any other Guaranty Obligations thereunder.
(b) Misrepresentation. Any representation or warranty made or deemed
made herein, in the Security Documents or in any of the other Credit
Documents or which is contained in any certificate, document or financial
or other statement furnished at any time under or in connection with this
Credit Agreement shall prove to have been incorrect, false or misleading
in any material respect on or as of the date made or deemed made.
(c) Covenant Default. (i) Any Credit Party shall fail to perform,
comply with or observe any term, covenant or agreement applicable to it
contained in Sections 5.4, 5.7, 5.9 or Article VI hereof; (ii) any Credit
Party shall fail to perform, comply with or observe any term, covenant or
agreement applicable to it contained in Sections 5.1(a), 5.1(b), 5.2(b),
5.2(d), 5.2(e), 5.2(f) or 5.2(g) and such breach or failure to comply is
not cured within five (5) days of its occurrence or (iii) any Credit Party
shall fail to comply with any other covenant contained in this Credit
Agreement or the other Credit Documents or any other agreement, document
or instrument among any Credit Party, the Administrative Agent and the
Lenders or executed by any Credit Party in favor of the
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Administrative Agent or the Lenders (other than as described in Sections
7.1(a) or 7.1(c)(i) above), and such breach or failure to comply is not
cured within thirty (30) days of its occurrence.
(d) Debt Cross-Default. Any Credit Party shall (i) default in any
payment of principal of or interest on any Indebtedness (other than the
Loans, Reimbursement Obligations and the Guaranty) in a principal amount
outstanding of at least $5,000,000 for the Borrower and any of its
Subsidiaries in the aggregate beyond any applicable grace period (not to
exceed 30 days), if any, provided in the instrument or agreement under
which such Indebtedness was created; (ii) default in the observance or
performance of any other agreement or condition relating to any
Indebtedness (other than the Loans, Reimbursement Obligations and the
Guaranty) in a principal amount outstanding of at least $5,000,000 in the
aggregate for the Credit Parties and their Subsidiaries or contained in
any instrument or agreement evidencing, securing or relating thereto, or
any other event shall occur or condition exist, the effect of which
default or other event or condition is to cause, or to permit the holder
or holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity; or
(iii) breach or default any Secured Hedging Agreement (subject to any
grace period therein).
(e) Other Cross-Defaults. The Credit Parties or any of their
Subsidiaries shall default in (i) the payment when due under any Material
Contract or (ii) in the performance or observance, of any obligation or
condition of any Material Contract and such failure to perform or observe
such other obligation or condition results in the termination of such
Material Contract.
(f) Bankruptcy Default. (i) The Credit Parties or any of their
Subsidiaries shall commence any case, proceeding or other action (A) under
any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of debtors,
seeking to have an order for relief entered with respect to it, or seeking
to have it judged bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts (provided that the
Borrower may wind up or dissolve Subsidiaries in accordance with the terms
of Section 6.4(a)), or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Credit Parties or any of their
Subsidiaries shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the any Credit Party
or any of its Subsidiaries any case, proceeding or other action of a
nature referred to in clause (i) above which (A) results in the entry of
an order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of sixty (60) days
(provided that no Lender shall be required to make an Extension of Credit
during such sixty (60) day period); or (iii) there shall be commenced
against any Credit Party or any of its Subsidiaries any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its
assets which results in the entry of an
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order for any such relief which shall not have been vacated, discharged,
or stayed or bonded pending appeal within sixty (60) days from the entry
thereof (provided that no Lender shall be required to make an Extension of
Credit during such 60 day period); or (iv) the Credit Parties or any of
their Subsidiaries shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts set forth
in clause (i), (ii) or (iii) above; or (v) the Credit Parties or any of
their Subsidiaries shall generally not, or shall be unable to, or shall
admit in writing its inability to, pay its debts as they become due.
(g) Judgment Default. One or more judgments, orders, decrees or
arbitration awards shall be entered against the Credit Parties or any of
their Subsidiaries involving in the aggregate a liability (to the extent
not paid when due or covered by insurance) of $5,000,000 or more and all
such judgments, orders, decrees or arbitration awards shall not have been
paid and satisfied, vacated, discharged, stayed or bonded pending appeal
within thirty (30) days from the entry thereof.
(h) ERISA Default. (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan (other than
a Permitted Lien) shall arise on the assets of the Borrower, any of its
Subsidiaries or any Commonly Controlled Entity, (iii) a Reportable Event
shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a Trustee is, in the
reasonable opinion of the Required Lenders, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA,
(v) the Borrower, any of its Subsidiaries or any Commonly Controlled
Entity shall, or in the reasonable opinion of the Required Lenders is
likely to, incur any liability in connection with a withdrawal from, or
the Insolvency or Reorganization of, any Multiemployer Plan or (vi) any
other similar event or condition shall occur or exist with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any,
could reasonably be expected to have a Material Adverse Effect.
(i) Change of Control. A Change of Control shall have occurred.
(j) Failure of Credit Documents. This Credit Agreement (including
the Guaranty) or any other Credit Document or any provision hereof or
thereof shall cease to be in full force and effect (other than in
accordance with its terms) or to give the Administrative Agent and/or the
Lenders the security interests, liens, rights, powers and privileges
purported to be created thereby, or any Credit Party or any Person acting
by or on behalf of any Credit Party shall (i) deny or disaffirm any Credit
Party's obligations under this Credit Agreement or any other Credit
Document or (ii) assert the invalidity or lack of perfection or priority
of any Lien granted to the Administrative Agent pursuant to the Security
Documents.
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(k) Hedging Agreement. Any termination payment shall be due by a
Credit Party under any Hedging Agreement and such amount is not paid
within the later to occur of five (5) Business Days after the due date
thereof or the expiration of grace periods, if any, in such Hedging
Agreement.
(l) Subordinated Debt. Any default (which is not waived or cured
within the applicable period of grace) or event of default shall occur
under any Subordinated Debt (including, without limitation, the 2007
Convertible Notes, the 2024 Convertible Notes, the Existing Subordinated
Notes or the New Convertible Notes) or the subordination provisions
contained therein shall cease to be in full force and effect or to give
the Lenders the rights, powers and privileges purported to be created
thereby.
SECTION 7.2 ACCELERATION; REMEDIES.
Upon the occurrence and during the continuation of an Event of Default,
then, and in any such event, (a) if such event is a Bankruptcy Event,
automatically the Commitments shall immediately terminate and the Loans (with
accrued interest thereon), and all other amounts under the Credit Documents
(including without limitation the maximum amount of all contingent liabilities
under Letters of Credit) shall immediately become due and payable, and the
Borrower shall immediately pay to the Administrative Agent cash collateral as
security for the Revolving LOC Obligations and the Credit-Linked LOC Obligations
for subsequent drawings under then outstanding Revolving Letters of Credit and
Credit-Linked Letters of Credit in an amount equal to the maximum amount which
may be drawn under such Letters of Credit then outstanding, and (b) if such
event is any other Event of Default, subject to the terms of Section 8.5, with
the written consent of the Required Lenders, the Administrative Agent may, or
upon the written request of the Required Lenders, the Administrative Agent
shall, take any or all of the following actions: (i) by notice to the Borrower
declare the Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; (ii) by notice of default to the Borrower declare
the Loans (with accrued interest thereon) and all other amounts owing under this
Credit Agreement and the Notes to be due and payable forthwith and direct the
Borrower to pay to the Administrative Agent cash collateral as security for the
Revolving LOC Obligations and Credit-Linked LOC Obligations for subsequent
drawings under then outstanding Revolving Letters of Credit or Credit-Linked
Letters of Credit in an amount equal to the maximum amount of which may be drawn
under such Letters of Credit then outstanding, whereupon the same shall
immediately become due and payable; and/or (iii) exercise on behalf of the
Lenders all of its other rights and remedies under this Credit Agreement, the
other Credit Documents and applicable law. Except as expressly provided above in
this Section 7.2, presentment, demand, protest and all other notices of any kind
are hereby expressly waived by the Credit Parties
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ARTICLE VIII
THE ADMINISTRATIVE AGENT
SECTION 8.1 APPOINTMENT.
(a) Each Lender hereby irrevocably designates and appoints Wachovia
as the Administrative Agent of such Lender under this Credit Agreement,
and each such Lender irrevocably authorizes Wachovia, as the
Administrative Agent for such Lender, to take such action on its behalf
under the provisions of this Credit Agreement and to exercise such powers
and perform such duties as are expressly delegated to the Administrative
Agent by the terms of this Credit Agreement, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision
to the contrary elsewhere in this Credit Agreement, the Administrative
Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender,
and no implied covenants, functions, responsibilities, duties, obligations
or liabilities shall be read into this Credit Agreement or otherwise exist
against the Administrative Agent.
(b) Each Revolving Issuing Lender shall act on behalf of the Lenders
with respect to any Revolving Letters of Credit issued by it and the
documents associated therewith, and each Revolving Issuing Lender shall
have all of the benefits and immunities (i) provided to the Administrative
Agent in this Article VIII with respect to any acts taken or omissions
suffered by such Revolving Issuing Lender in connection with Revolving
Letters of Credit issued by it or proposed to be issued by it and the
applications and agreements for letters of credit pertaining to such
Revolving Letters of Credit as fully as if the term "Administrative Agent"
as used in this Article VIII included such Revolving Issuing Lender with
respect to such acts or omissions, and (ii) as additionally provided
herein with respect to any Issuing Lender.
(c) Each Credit-Linked Issuing Lender shall act on behalf of the
Credit-Linked Lenders with respect to any Credit-Linked Letters of Credit
issued by it and the documents associated therewith, and each
Credit-Linked Issuing Lender shall have all of the benefits and immunities
(i) provided to the Administrative Agent in this Article VIII with respect
to any acts taken or omissions suffered by such Credit-Linked Issuing
Lender in connection with Credit-Linked Letters of Credit issued by it or
proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Credit-Linked Letters of Credit as
fully as if the term "Administrative Agent" as used in this Article VIII
included such Credit-Linked Issuing Lender with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to any
Issuing Lender.
SECTION 8.2 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties under this Credit
Agreement by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the
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negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care. Without limiting the foregoing, the Administrative Agent may
appoint one of its affiliates as its agent to perform the functions of the
Administrative Agent hereunder relating to the advancing of funds to the
Borrower and distribution of funds to the Lenders and to perform such other
related functions of the Administrative Agent hereunder as are reasonably
incidental to such functions.
SECTION 8.3 EXCULPATORY PROVISIONS.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact, Subsidiaries or affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Credit Agreement (except for its or such
Person's own gross negligence or willful misconduct) or (b) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by any Credit Party or any officer thereof contained in this
Credit Agreement or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent under or
in connection with, this Credit Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any of the Credit
Documents or for any failure of any Credit Party to perform its obligations
hereunder or thereunder. The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance by any Credit Party of any of the agreements contained in, or
conditions of, this Credit Agreement, or to inspect the properties, books or
records of any Credit Party.
SECTION 8.4 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or
conversation believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation,
counsel to the Credit Parties), independent accountants and other experts
selected by the Administrative Agent. The Administrative Agent may deem
and treat the payee of any Note as the owner thereof for all purposes
unless an executed Commitment Transfer Supplement has been filed with the
Administrative Agent pursuant to Section 9.6(c) with respect to the Loans
evidenced by such Note. The Administrative Agent shall be fully justified
in failing or refusing to take any action under this Credit Agreement
unless it shall first receive such advice or concurrence of the Required
Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under any of the Credit
Documents in accordance with a request of the Required Lenders or all of
the Lenders, as may be required under this Credit Agreement, and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Notes.
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(b) For purposes of determining compliance with the conditions
specified in Section 4.1, each Lender that has signed this Credit
Agreement shall be deemed to have consented to, approved or accepted or to
be satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender.
SECTION 8.5 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Credit Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided, however, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders except to the extent that
this Credit Agreement expressly requires that such action be taken, or not
taken, only with the consent or upon the authorization of the Required Lenders,
or all of the Lenders, as the case may be.
SECTION 8.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender expressly acknowledges that neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representation or warranty to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
any Credit Party, shall be deemed to constitute any representation or warranty
by the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower or any other Credit Party and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Credit
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Borrower or any other Credit Party which may come into the possession of the
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Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
SECTION 8.7 INDEMNIFICATION.
The Lenders agree to indemnify each of the Administrative Agent, Issuing
Lenders and the Swingline Lender (each an "Indemnified Party") in its capacity
as such hereunder (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to such
Lenders' respective Commitment Percentages in effect on the date on which
indemnification is sought under this Section, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes
or any Reimbursement Obligation) be imposed on, incurred by or asserted against
such Indemnified Party in any way relating to or arising out of any Credit
Document or any documents contemplated by or referred to herein or therein or
the Transactions contemplated hereby or thereby or any action taken or omitted
by an Indemnified Party under or in connection with any of the foregoing;
provided, however, that no Lender shall be liable to an Indemnified Party for
the payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting from such Indemnified Party's gross negligence or willful
misconduct, as determined by a court of competent jurisdiction. The agreements
in this Section 8.7 shall survive the termination of this Credit Agreement and
payment of the Notes, any Reimbursement Obligation and all other amounts payable
hereunder.
SECTION 8.8 THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower and
the other Credit Parties as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to the Loans made or renewed by it
and any Note issued to it, the Administrative Agent shall have the same rights
and powers under this Credit Agreement as any Lender and may exercise the same
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
SECTION 8.9 SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign as Administrative Agent upon thirty
(30) days' prior written notice to the Borrower and the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Credit
Agreement and the other Credit Documents, then the Required Lenders shall
appoint from among the Lenders a successor administrative agent for the Lenders,
which successor agent shall be approved by the Borrower (such approval not to be
unreasonably withheld) so long as no Event of Default has occurred and is
continuing, whereupon such successor administrative agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor administrative agent effective
upon such appointment and approval, and the former Administrative Agent's
rights, powers and duties as Administrative Agent shall be terminated,
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without any other or further act or deed on the part of such former
Administrative Agent or any of the parties to this Credit Agreement or any
holders of the Notes. If no successor Administrative Agent has accepted
appointment as Administrative Agent within thirty (30) days after the retiring
Administrative Agent's giving notice of resignation, the retiring Administrative
Agent shall have the right, on behalf of the Lenders, to appoint a successor
administrative agent, which successor shall be approved by the Borrower (such
approval not to be unreasonably withheld) so long as no Event of Default has
occurred and is continuing; provided that such successor administrative agent
has minimum capital and surplus of at least $500,000,000. If no successor
administrative agent has accepted appointment as Administrative Agent within
sixty (60) days after the retiring Administrative Agent's giving notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
become effective and the Lenders shall perform all duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor administrative agent as provided for above. After any retiring
Administrative Agent's resignation as Administrative Agent, the indemnification
provisions of this Credit Agreement and the other Credit Documents and the
provisions of this Article VIII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Credit Agreement. In connection with any resignation by the Administrative Agent
pursuant to this Section 8.9, the Credit-Linked Deposits shall be transferred to
an account held at or otherwise under the dominion of the successor
Administrative Agent.
SECTION 8.10 OTHER AGENTS.
None of the Lenders or other Persons identified on the facing page or
signature pages of this Agreement as a "syndication agent," "documentation
agent," "co-agent," "book manager," "book runner," "lead manager," "arranger,"
"lead arranger" or "co-arranger" shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than, in the case
of such Lenders, those applicable to all Lenders as such. Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any of the Lenders or
other Persons so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
SECTION 8.11 RELEASE OF COLLATERAL AND AFC.
Each of the Lenders hereby authorizes the Administrative Agent to release
(a) any Collateral sold, transferred or otherwise disposed of by the Credit
Parties to the extent such sale, transfer or other disposition is permitted by
the terms of the Credit Documents and (b) Aerojet Fine Chemicals LLC from the
Guaranty upon the consummation of the AFC Sale (to the extent the AFC Sale is
for all or substantially all of the voting stock thereof). Upon any sale of
Collateral permitted by the terms of the Credit Documents (including, without
limitation, the AFC Sale) the Administrative Agent shall, at the request and
expense of the Borrower, release such Collateral and any Liens related thereto.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1 AMENDMENTS, WAIVERS AND RELEASE OF COLLATERAL.
Neither this Credit Agreement, nor any of the Notes, nor any of the other
Credit Documents, nor any terms hereof or thereof may be amended, supplemented,
waived or modified except in accordance with the provisions of this Section nor
may the Borrower or any Guarantor be released except in accordance with the
provisions of this Section 9.1. The Required Lenders may, or, with the written
consent of the Required Lenders, the Administrative Agent may, from time to
time, (a) enter into with the Borrower or any other Credit Party written
amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Credit Agreement or
the other Credit Documents or changing in any manner the rights of the Lenders
or of the Borrower or any other Credit Party hereunder or thereunder or (b)
waive, on such terms and conditions as the Required Lenders may specify in such
instrument, any of the requirements of this Credit Agreement or the other Credit
Documents or any Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, waiver, supplement,
modification or release shall:
(i) reduce the amount or extend the scheduled date of maturity
of any Loan or Note or any installment thereon, or reduce the stated
rate of any interest or fee payable hereunder (except in connection
with a waiver of interest at the increased post-default rate set
forth in Section 2.11(a) which shall be determined by a vote of the
Required Lenders) or extend the scheduled date of any payment
thereof or increase the amount or extend the expiration date of any
Lender's Commitment, in each case without the written consent of
each Lender directly affected thereby; provided that, it is
understood and agreed that no waiver, reduction or deferral of a
mandatory prepayment required pursuant to Section 2.9(b), nor any
amendment of Section 2.9(b) or the definitions of Asset Disposition,
Debt Issuance, Equity Issuance, Excess Cash Flow, or Recovery Event,
shall constitute a reduction of the amount of, or an extension of
the scheduled date of, any principal installment of any Loan or
Note; or
(ii) amend, modify or waive any provision of this Section 9.1
or reduce the percentage specified in the definition of Required
Lenders, without the written consent of all the Lenders; or
(iii) amend, modify or waive any provision of Article VIII
without the written consent of the then Administrative Agent; or
(iv) release the Borrower or all or substantially all of the
Guarantors from their respective obligations hereunder or under the
Guaranty, without the written consent of all of the Lenders and any
Hedging Agreement Provider; or
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(v) release all or substantially all of the Collateral without
the written consent of all of the Secured Parties; or
(vi) subordinate the Loans to any other Indebtedness without
the written consent of all of the Lenders; or
(vii) permit a Letter of Credit to have an original expiry
date more than twelve (12) months from the date of issuance without
the consent of each of the Revolving Lenders or Credit-Linked
Lenders, as applicable; provided, that the expiry date of any Letter
of Credit may be extended in accordance with the terms of Section
2.2(a) or Section 2.5(a), as applicable; or
(viii) permit the Borrower to assign or transfer any of its
rights or obligations under this Credit Agreement or other Credit
Documents; or
(ix) amend, modify or waive any provision of the Credit
Documents requiring consent, approval or request of the Required
Lenders or all Lenders without the written consent of the Required
Lenders or all the Lenders as appropriate; or
(x) amend, modify or waive the order in which Credit Party
Obligations are paid in Section 2.9(b)(viii) or the pro rata
treatment of payments in Section 2.13(a), without the written
consent of each Lender directly affected thereby; provided that,
notwithstanding the foregoing, such order or treatment may be
modified without the consent of each Lender directly affected
thereby (but with the consent of the Required Lenders) to permit
additional extensions of credit constituting (A) term loans to share
ratably with the Term Loan in the application of repayment or
prepayments pursuant to Section 2.9 or Section 2.13 with the consent
of the Required Lenders, or (B) revolving loans to share ratably
with the Revolving Loans in the application of repayments or
prepayments pursuant to Section 2.9 or Section 2.13 with the consent
of the Required Lenders; or
(xi) amend, modify or waive the order in which Credit Party
Obligations are paid in Section 2.13(b) or the definition of "Credit
Party Obligations" to delete or otherwise modify the treatment of
any obligations referenced in such definition without the written
consent of each Secured Party directly affected thereby; provided
that, notwithstanding the foregoing, such order may be modified
without the consent of each Secured Party directly affected thereby
to permit additional extensions of credit approved by the Required
Lenders to share ratably with the Credit Party Obligations; or
(xii) amend, modify or waive the definition of "Secured
Hedging Agreement", "Hedging Agreement Provider" or "Secured Party"
without the consent of each Hedging Agreement Provider; or
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(xiii) without the written consent of the Revolving Lenders
holding in the aggregate more than 50% of the Revolving Commitments
(or if the Revolving Commitments have been terminated, 50% of the
outstanding Revolving Loans and Revolving Participation Interests),
amend, modify or waive any provision specific to the revolving
credit facility, swingline subfacility and revolving letter of
credit subfacility provided under Sections 2.1, 2.2 and 2.3; or
(xiv) without the written consent of the Credit-Linked Lenders
holding in the aggregate more than 50% of the Credit-Linked
Commitments (or if the Credit-Linked Commitments have been
terminated, 50% of the outstanding Term Loans and Credit-Linked
Participation Interests), amend, modify or waive any provision
specific to the credit-linked facilities provided under Sections 2.4
and 2.5.
provided, further, that no amendment, waiver or consent affecting the
rights or duties of the Administrative Agent, any Issuing Lender or the
Swingline Lender under any Credit Document shall in any event be effective,
unless in writing and signed by the Administrative Agent, such Issuing Lender
and/or the Swingline Lender, as applicable, in addition to the Lenders required
hereinabove to take such action.
Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Credit Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
outstanding Loans and Notes and other Credit Documents, and any Default or Event
of Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of the
Credit Parties shall not be required for any amendment, modification or waiver
of the provisions of Article VIII (other than the provisions of Section 8.9);
provided, however, that the Administrative Agent will provide written notice to
the Borrower of any such amendment, modification or waiver. In addition, the
Borrower and the Lenders hereby authorize the Administrative Agent to modify
this Credit Agreement by unilaterally amending or supplementing Schedule 2.1(a)
from time to time in the manner requested by the Borrower, the Administrative
Agent or any Lender in order to reflect any assignments or transfers of the
Loans as provided for hereunder; provided, however, that the Administrative
Agent shall promptly deliver a copy of any such modification to the Borrower and
each Lender.
Notwithstanding the fact that the consent of all the Lenders is required
in certain circumstances as set forth above, (x) each Lender is entitled to vote
as such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.
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SECTION 9.2 NOTICES.
Except as otherwise provided in Article II, all notices, requests and
demands to or upon the respective parties hereto to be effective shall be in
writing (including by telecopy), and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made (a) when delivered by
hand, (b) when transmitted via telecopy (or other facsimile device) to the
number set out herein or (c) the day following the day on which the same has
been delivered prepaid to a reputable national overnight air courier service, in
each case, addressed as follows in the case of the Borrower, the other Credit
Parties and the Administrative Agent, and as set forth on Schedule 9.2 in the
case of the Lenders, or to such other address as may be hereafter notified by
the respective parties hereto and any future holders of the Notes:
The Borrower
and the other
Credit Parties: GenCorp Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
▇▇▇▇ ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
The Administrative
Agent: Wachovia Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇/▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Syndication Agency Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy to:
Wachovia Bank, National Association
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ Santa ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
provided, that notices given by the Borrower pursuant to Section 2.1 or Section
2.12 hereof shall be effective only upon receipt thereof by the Administrative
Agent.
SECTION 9.3 NO WAIVER; CUMULATIVE REMEDIES.
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
SECTION 9.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Credit Agreement and the Notes
and the making of the Loans; provided that all such representations and
warranties shall terminate on the date upon which the Commitments have been
terminated and all amounts owing hereunder and under any Notes have been paid in
full.
SECTION 9.5 PAYMENT OF EXPENSES AND TAXES.
The Credit Parties agree (a) to pay or reimburse the Administrative Agent
and WCM for all reasonable out-of-pocket costs and expenses incurred in
connection with the development, preparation, negotiation, printing and
execution of, and any amendment, supplement or modification to, this Credit
Agreement and the other Credit Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
Transactions, together with the reasonable fees and disbursements of counsel to
the Administrative Agent, (b) to pay or reimburse each Lender and the
Administrative Agent for all its costs and expenses incurred in connection with
the enforcement or preservation of any rights
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under this Credit Agreement, the Notes and any such other documents, including,
without limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent and to the Lenders (including reasonable allocated costs of
in-house legal counsel), and (c) on demand, to pay, indemnify, and hold each
Lender, the Administrative Agent and WCM harmless from, any and all recording
and filing fees and any and all liabilities with respect to, or resulting from
any delay in paying stamp, excise and other similar taxes, if any, which may be
payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, the Credit Documents and any such other
documents, (d) to pay, indemnify, and hold each Lender, the Administrative Agent
and WCM and their Affiliates harmless from and against, any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of the
Credit Documents and any such other documents and the use, or proposed use, of
proceeds of the Loans and (e) to pay any civil penalty or fine assessed by the
U. S. Department of the Treasury's Office of Foreign Assets Control against, and
all reasonable costs and expenses (including counsel fees and disbursements)
incurred in connection with defense thereof by the Administrative Agent or any
Lender as a result of the funding of Loans, the issuance of Letters of Credit,
the acceptance of payments or of Collateral due under the Credit Documents (all
of the foregoing, collectively, the "indemnified liabilities"); provided,
however, that the Borrower shall not have any obligation hereunder to the
Administrative Agent, WCM or any Lender with respect to indemnified liabilities
arising from the gross negligence or willful misconduct of the Administrative
Agent, WCM or such Lender, as determined by a court of competent jurisdiction.
The agreements in this Section 9.5 shall survive repayment of the Loans, Notes
and all other amounts payable hereunder.
SECTION 9.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS; PURCHASING LENDERS.
(a) This Credit Agreement shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except
that the Borrower may not assign or transfer any of its rights or
obligations under this Credit Agreement or the other Credit Documents
without the prior written consent of each Lender.
(b) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or
other entities ("Participants") participating interests in any Loan owing
to such Lender, any Note held by such Lender, any Commitment of such
Lender, or any other interest of such Lender hereunder, in each case in
minimum amounts of $1,000,000 (or, if less, the entire amount of such
Lender's Obligations, Commitments or other interests). In the event of any
such sale by a Lender of participating interests to a Participant, such
Lender's obligations under this Credit Agreement to the other parties to
this Credit 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 Credit Agreement,
and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations
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under this Credit Agreement. No Lender shall transfer or grant any
participation under which the Participant shall have rights to approve any
amendment to or waiver of this Credit Agreement or any other Credit
Document except to the extent such amendment or waiver would (i) extend
the scheduled maturity of any Loan or Note or any installment thereon in
which such Participant is participating, or reduce the stated rate or
extend the time of payment of interest or fees thereon (except in
connection with a waiver of interest at the increased post-default rate)
or reduce the principal amount thereof, or increase the amount of the
Participant's participation over the amount thereof then in effect (it
being understood that a waiver of any Default or Event of Default shall
not constitute a change in the terms of such participation, and that an
increase in any Commitment or Loan shall be permitted without consent of a
Participant if such Participant's participation is not increased as a
result thereof), (ii) release any material Guarantor from its obligations
under the Guaranty, (iii) release all or substantially all of the
Collateral, or (iv) consent to the assignment or transfer by the Borrower
of any of its rights and obligations under this Credit Agreement. In the
case of any such participation, the Participant shall not have any rights
under this Credit Agreement or any of the other Credit Documents (the
Participant's rights against such Lender in respect of such participation
to be those set forth in the agreement executed by such Lender in favor of
the Participant relating thereto) and all amounts payable by the Borrower
hereunder shall be determined as if such Lender had not sold such
participation; provided that each Participant shall be entitled to the
benefits of Sections 2.16, 2.17, 2.18, and 2.19 with respect to its
participation in the Commitments and the Loans outstanding from time to
time; provided, that no Participant shall be entitled to receive any
greater amount pursuant to such Sections than the transferor Lender would
have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such Participant
had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time, sell or assign to any Lender,
any Affiliate or Approved Fund of such Lender or any Approved Fund of an
Affiliate of such Lender and with the consent of the Administrative Agent,
each Revolving Issuing Lender and, so long as no Event of Default has
occurred and is continuing, the Borrower (which consent of the Borrower
shall not be unreasonably withheld or delayed), to one or more additional
banks, insurance companies or other financial institutions or any funds
investing in bank loans ("Purchasing Lenders"), all or any part of its
rights and obligations under this Credit Agreement in minimum amounts of
(i) $5,000,000 with respect to its Revolving Commitment and its Revolving
Loans (or, if less, the entire amount of such Lender's Revolving
Commitment and Revolving Loans), (ii) $3,000,000 (or any lesser amount as
approved by the Administrative Agent) with respect to its Term Loan (or,
if less, the entire amount of such Lender's Term Loan) and (iii) and
$3,000,000 in the case of an assignment of Credit-Linked Revolving Loans
or any Credit-Linked Commitment (or, if less, the entire amount of such
Lender's Credit-Linked Commitment), pursuant to a Commitment Transfer
Supplement, executed by such Purchasing Lender, such transferor Lender
and, to the extent required by this Section 9.6, the Administrative Agent
and the Borrower), and delivered to the Administrative Agent for its
acceptance and recording in the Register; provided, however, that any sale
or assignment to an existing Lender, an
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Affiliate or Approved Fund of an existing Lender or an Approved Fund of an
Affiliate of an existing Lender (A) shall require the consent of the
Administrative Agent and each Revolving Issuing Lender, but shall not
require the consent of the Borrower and (B) shall not be subject to the
minimum assignment amounts specified herein. Upon such execution,
delivery, acceptance and recording, from and after the Transfer Effective
Date specified in such Commitment Transfer Supplement, (x) the Purchasing
Lender thereunder shall be a party hereto and, to the extent provided in
such Commitment Transfer Supplement, have the rights and obligations of a
Lender hereunder with a Commitment as set forth therein, and (y) the
transferor Lender thereunder shall, to the extent provided in such
Commitment Transfer Supplement, be released from its obligations under
this Credit Agreement (and, in the case of a Commitment Transfer
Supplement covering all or the remaining portion of a transferor Lender's
rights and obligations under this Credit Agreement, such transferor Lender
shall cease to be a party hereto). Such Commitment Transfer Supplement
shall be deemed to amend this Credit Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing Lender
and the resulting adjustment of Commitment Percentages arising from the
purchase by such Purchasing Lender of all or a portion of the rights and
obligations of such transferor Lender under this Credit Agreement and the
Notes. On or prior to the Transfer Effective Date specified in such
Commitment Transfer Supplement, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the Notes
delivered to the Administrative Agent pursuant to such Commitment Transfer
Supplement new Notes to the order of such Purchasing Lender in an amount
equal to the Commitment assumed by it pursuant to such Commitment Transfer
Supplement and, unless the transferor Lender has not retained a Commitment
hereunder, new Notes to the order of the transferor Lender in an amount
equal to the Commitment retained by it hereunder. Such new Notes shall be
dated the Closing Date and shall otherwise be in the form of the Notes
replaced thereby. The Notes surrendered by the transferor Lender shall be
returned by the Administrative Agent to the Borrower marked "canceled".
(d) The Administrative Agent shall maintain at its address referred
to in Section 9.2 a copy of each Commitment Transfer Supplement delivered
to it and a register (the "Register") for the recordation of the names and
addresses of the Lenders and the Commitment of, and principal amount of
the Loans owing to, each Lender from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as the owner of the Loan recorded
therein for all purposes of this Credit Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(e) Upon its receipt of a duly executed Commitment Transfer
Supplement, together with payment to the Administrative Agent by the
transferor Lender or the Purchasing Lender (except for any assignment by a
Lender to an Affiliate of such Lender), as agreed between them, of a
registration and processing fee of $3,500 for each Purchasing Lender
listed in such Commitment Transfer Supplement and the Notes
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subject to such Commitment Transfer Supplement, the Administrative Agent
shall (i) accept such Commitment Transfer Supplement and (ii) record the
information contained therein in the Register.
(f) Each Credit Party authorizes each Lender to disclose to any
Participant or Purchasing Lender (each, a "Transferee") and any
prospective Transferee any and all financial information in such Lender's
possession concerning the Credit Parties and their Affiliates which has
been delivered to such Lender by or on behalf of a Credit Party pursuant
to this Credit Agreement or which has been delivered to such Lender by or
on behalf of a Credit Party in connection with such Lender's credit
evaluation of the Credit Parties and their Affiliates prior to becoming a
party to this Credit Agreement, in each case subject to Section 9.14.
(g) At the time of each assignment pursuant to this Section 9.6 to a
Person which is not already a Lender hereunder and which is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code)
for federal income tax purposes, the respective assignee Lender shall
provide to the Borrower and the Administrative Agent the appropriate
Internal Revenue Service Forms (and, if applicable, a Tax Exempt
Certificate) described in Section 2.19.
(h) Nothing herein shall prohibit any Lender from pledging or
assigning any of its rights under this Credit Agreement (including,
without limitation, any right to payment of principal and interest under
any Note) to any Federal Reserve Bank in accordance with applicable laws.
(i) The Credit-Linked Deposit funded by any Credit-Linked Lender
pursuant to Section 2.6 shall not be released in connection with any
assignment of its Credit-Linked Commitment but shall instead be purchased
by the relevant assignee and continue to be held for application in
accordance with the terms of Section 2.6 in respect of the Credit-Linked
Commitment assigned to such assignee.
SECTION 9.7 ADJUSTMENTS; SET-OFF.
(a) Each Lender agrees that if any Lender (a "benefited Lender")
shall at any time receive any payment of all or part of its Loans, or
interest thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 7.1(e), or otherwise) in
a greater proportion than any such payment to or collateral received by
any other Lender, if any, in respect of such other Lender's Loans, or
interest thereon, such benefited Lender shall purchase for cash from the
other Lenders a participating interest in such portion of each such other
Lender's Loan, or shall provide such other Lenders with the benefits of
any such collateral, or the proceeds thereof, as shall be necessary to
cause such benefited Lender to share the excess payment or benefits of
such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of
such recovery,
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but without interest. The Borrower agrees that each Lender so purchasing a
portion of another Lender's Loans may exercise all rights of payment
(including, without limitation, rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
(b) In addition to any rights and remedies of the Lenders provided
by law (including, without limitation, other rights of set-off), each
Lender shall have the right, with the consent of the Administrative Agent
or the Required Lenders, but without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted
by applicable law, during the continuance of an Event of Default, to
setoff and appropriate and apply any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other
credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any
time held by or owing to such Lender or any branch or agency thereof to or
for the credit or the account of the Borrower or any other Credit Party,
or any part thereof in such amounts as such Lender may elect, against and
on account of the Loans and other Credit Party Obligations of the Borrower
and the other Credit Parties and claims of every nature and description of
any Lender against the Borrower and the other Credit Parties, in any
currency, whether arising hereunder, under any other Credit Document or
any Secured Hedging Agreement, as such Lender may elect, whether or not
such Lender or any other Lender has made any demand for payment and
although such obligations, liabilities and claims may be contingent or
unmatured. The aforesaid right of set-off may be exercised by each Lender
against the Borrower, any other Credit Party or against any trustee in
bankruptcy, debtor in possession, assignee for the benefit of creditors,
receiver or execution, judgment or attachment creditor of the Borrower or
any other Credit Party, or against anyone else claiming through or against
the Borrower, any other Credit Party or any such trustee in bankruptcy,
debtor in possession, assignee for the benefit of creditors, receiver, or
execution, judgment or attachment creditor, notwithstanding the fact that
such right of set-off shall not have been exercised by such Lender prior
to the occurrence of any Event of Default. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off
and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application.
SECTION 9.8 TABLE OF CONTENTS AND SECTION HEADINGS.
The table of contents and the Section and subsection headings herein are
intended for convenience only and shall be ignored in construing this Credit
Agreement.
SECTION 9.9 COUNTERPARTS.
This Credit Agreement may be executed by one or more of the parties to
this Credit Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. A set of the copies of this Credit Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.
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SECTION 9.10 INTEGRATION; EFFECTIVENESS; CONTINUING AGREEMENT.
(a) This Credit Agreement, together with the other Credit Documents,
comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements,
written or oral, on such subject matter. In the event of any conflict
between the provisions of this Credit Agreement and those of any other
Credit Document, the provisions of this Credit Agreement shall control;
provided that the inclusion of supplemental rights or remedies in favor of
the Administrative Agent or the Lenders in any other Credit Document shall
not be deemed a conflict with this Credit Agreement. Each Credit Document
was drafted with the joint participation of the respective parties thereto
and shall be construed neither against nor in favor of any party, but
rather in accordance with the fair meaning thereof.
(b) This Credit Agreement shall become effective at such time when
all of the conditions set forth in Section 4.1 have been satisfied or
waived by the Lenders and it shall have been executed by the Borrower, the
Guarantors and the Administrative Agent, and the Administrative Agent
shall have received copies hereof (telefaxed or otherwise) which, when
taken together, bear the signatures of each Lender, and thereafter this
Credit Agreement shall be binding upon and inure to the benefit of the
Borrower, the Guarantors, the Administrative Agent and each Lender and
their respective successors and permitted assigns.
(c) This Credit Agreement shall be a continuing agreement and shall
remain in full force and effect until all Loans, Revolving LOC
Obligations, Credit-Linked LOC Obligations, interest, fees and other
Credit Party Obligations (other than those obligations that expressly
survive the termination of this Credit Agreement) have been paid in full
and all Commitments and Letters of Credit have been terminated. Upon
termination, the Credit Parties shall have no further obligations (other
than those obligations that expressly survive the termination of this
Credit Agreement) under the Credit Documents and the Administrative Agent
shall, at the request and expense of the Borrower, deliver all the
Collateral in its possession to the Borrower and release all Liens on the
Collateral; provided that should any payment, in whole or in part, of the
Credit Party Obligations be rescinded or otherwise required to be restored
or returned by the Administrative Agent or any Lender, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, then the
Credit Documents shall automatically be reinstated and all Liens of the
Administrative Agent shall reattach to the Collateral and all amounts
required to be restored or returned and all costs and expenses incurred by
the Administrative Agent or any Lender in connection therewith shall be
deemed included as part of the Credit Party Obligations.
SECTION 9.11 SEVERABILITY.
Any provision of this Credit Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition
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or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 9.12 GOVERNING LAW.
This Credit Agreement and the Notes and the rights and obligations of the
parties under this Credit Agreement and the Notes shall be governed by, and
construed and interpreted in accordance with, the law of the State of New York.
SECTION 9.13 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
All judicial proceedings brought against the Borrower and/or any other
Credit Party with respect to this Credit Agreement, any Note or any of the other
Credit Documents may be brought in any state or federal court of competent
jurisdiction in the State of New York, and, by execution and delivery of this
Credit Agreement, each of the Borrower and the other Credit Parties accepts, for
itself and in connection with its properties, generally and unconditionally, the
non-exclusive jurisdiction of the aforesaid courts solely for purposes of any
proceeding arising out of this Credit Agreement or any of the other Credit
Documents (and not as a general submission to New York jurisdiction) and
irrevocably agrees to be bound by any final judgment rendered thereby in
connection with this Credit Agreement from which no appeal has been taken or is
available. Each of the Borrower and the other Credit Parties irrevocably agrees
that all service of process in any such proceedings in any such court may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to it at its address set
forth in Section 9.2 or at such other address of which the Administrative Agent
shall have been notified pursuant thereto, such service being hereby
acknowledged by the each of the Borrower and the other Credit Parties to be
effective and binding service in every respect. Each of the Borrower, the other
Credit Parties, the Administrative Agent and the Lenders irrevocably waives any
objection, including, without limitation, any objection to the laying of venue
or based on the grounds of forum non conveniens, which it may now or hereafter
have to the bringing of any such action or proceeding in any such jurisdiction.
Nothing herein shall affect the right to serve process in any other manner
permitted by law or shall limit the right of any Lender to bring proceedings
against the Borrower or the other Credit Parties in the court of any other
jurisdiction.
SECTION 9.14 CONFIDENTIALITY.
The Administrative Agent and each of the Lenders agrees that, without the
prior consent of the Borrower, it will use its best efforts not to disclose any
information (the "Information") with respect to the Credit Parties which is
furnished pursuant to this Credit Agreement, any other Credit Document or any
documents contemplated by or referred to herein or therein and which is
designated by the Borrower to the Lenders in writing as confidential or as to
which it is otherwise reasonably clear such Information is not public, except
that any Lender may disclose any such information (a) to its employees,
Affiliates, auditors and counsel or to another Lender, (b) as has become
generally available to the public other than by a breach of this Section 9.14,
(c) as may be required or appropriate in any report, statement or testimony
submitted to any municipal, state or federal regulatory body having or claiming
to have jurisdiction over such
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Lender or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or the OCC or the NAIC or similar organizations (whether in the
United States or elsewhere) or their successors, (d) as may be required or
appropriate in response to any summons or subpoena or any law, order, regulation
or ruling applicable to such Lender, (e) to any prospective Participant or
assignee in connection with any contemplated transfer pursuant to Section 9.6;
provided that such prospective transferee shall have been made aware of this
Section 9.14 and shall have agreed to be bound by its provisions as if it were a
party to this Credit Agreement, (f) to Gold Sheets and other similar bank trade
publications; such information to consist of deal terms and other information
regarding the credit facilities evidenced by this Credit Agreement customarily
found in such publications, (g) in connection with any suit, action or
proceeding for the purpose of defending itself, reducing its liability, or
protecting or exercising any of its claims, rights, remedies or interests under
or in connection with the Credit Documents or any Secured Hedging Agreement, (h)
to any direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provisions of this Section 9.14), and (i) to the National
Association of Insurance Commissioners or any similar organization or any
nationally recognized rating agency that requires access to information about a
Lender's investment portfolio in connection with ratings issued with respect to
such Lender. Notwithstanding the foregoing, Wachovia may disclose Information,
without notice to the Borrower, to governmental regulatory authorities in
connection with any regulatory examination of Wachovia or in accordance with
Wachovia's regulatory compliance policy.
SECTION 9.15 ACKNOWLEDGMENTS.
The Borrower and the other Credit Parties each hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of each Credit Document;
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower or any other Credit
Party arising out of or in connection with this Credit Agreement and the
relationship between Administrative Agent and Lenders, on one hand, and
the Borrower and the other Credit Parties, on the other hand, in
connection herewith is solely that of debtor and creditor; and
(c) no joint venture exists among the Lenders or among the Borrower
or the other Credit Parties and the Lenders.
SECTION 9.16 WAIVERS OF JURY TRIAL; WAIVER OF CONSEQUENTIAL DAMAGES.
THE BORROWER, THE OTHER CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
CREDIT AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Each of the Borrower, the other Credit Parties, the Administrative Agent and the
Lenders agree not
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to assert any claim against any other party to this Credit Agreement or any
their respective directors, officers, employees, attorneys, Affiliates or
agents, on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or otherwise relating to any of the
Transactions.
SECTION 9.17 PATRIOT ACT NOTICE.
Each Lender and the Administrative Agent (for itself and not on behalf of
any other party) hereby notifies the Borrower that, pursuant to the requirements
of the USA Patriot Act, Title III of Pub. L. 107-56, signed into law October 26,
2001 (the "Patriot Act"), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender or
the Administrative Agent, as applicable, to identify the Borrower in accordance
with the Patriot Act.
ARTICLE X
GUARANTY
SECTION 10.1 THE GUARANTY.
In order to induce the Lenders to enter into this Credit Agreement and any
Hedging Agreement Provider to enter into any Secured Hedging Agreement and to
extend credit hereunder and thereunder and in recognition of the direct benefits
to be received by the Guarantors from the Extensions of Credit hereunder and any
Secured Hedging Agreement, each of the Guarantors hereby agrees with the
Administrative Agent, the Lenders and the Hedging Agreement Providers as
follows: each Guarantor hereby unconditionally and irrevocably jointly and
severally guarantees as primary obligor and not merely as surety the full and
prompt payment when due, whether upon maturity, by acceleration or otherwise, of
any and all indebtedness of the Borrower to the Administrative Agent, the
Lenders and the Hedging Agreement Providers. If any or all of the indebtedness
becomes due and payable hereunder or under any Secured Hedging Agreement, each
Guarantor unconditionally promises to pay such indebtedness to the
Administrative Agent, the Secured Parties or their respective order, or demand,
together with any and all reasonable expenses which may be incurred by the
Administrative Agent or the Secured Parties in collecting any of the Credit
Party Obligations. The word "indebtedness" is used in this Article X in its most
comprehensive sense and means any and all advances, debts, obligations and
liabilities of the Borrower arising in connection with this Credit Agreement,
the other Credit Documents or any Secured Hedging Agreement, including
specifically all Credit Party Obligations, in each case, heretofore, now, or
hereafter made, incurred or created, whether voluntarily or involuntarily,
absolute or contingent, liquidated or unliquidated, determined or undetermined,
whether or not such indebtedness is from time to time reduced, or extinguished
and thereafter increased or incurred, whether the Borrower may be liable
individually or jointly with others, whether or not recovery upon such
indebtedness may be or hereafter become barred by any statute of limitations,
and whether or not such indebtedness may be or hereafter become otherwise
unenforceable.
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Notwithstanding any provision to the contrary contained herein or in any
other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation,
Bankruptcy Laws).
SECTION 10.2 BANKRUPTCY.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all Credit Party
Obligations of the Borrower to the Secured Parties whether or not due or payable
by the Borrower upon the occurrence of any of the events specified in Section
7.1(f), and unconditionally promises to pay such Credit Party Obligations to the
Administrative Agent for the account of the Secured Parties, or order, on
demand, in lawful money of the United States. Each of the Guarantors further
agrees that to the extent that the Borrower or a Guarantor shall make a payment
or a transfer of an interest in any property to the Administrative Agent or any
Secured Party, which payment or transfer or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, or otherwise is avoided,
and/or required to be repaid to the Borrower or a Guarantor, the estate of the
Borrower or a Guarantor, a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then to the
extent of such avoidance or repayment, the obligation or part thereof intended
to be satisfied shall be revived and continued in full force and effect as if
said payment had not been made.
SECTION 10.3 NATURE OF LIABILITY.
The liability of each Guarantor hereunder is exclusive and independent of
any security for or other guaranty of the Credit Party Obligations of the
Borrower whether executed by any such Guarantor, any other guarantor or by any
other party, and no Guarantor's liability hereunder shall be affected or
impaired by (a) any direction as to application of payment by the Borrower or by
any other party, or (b) any other continuing or other guaranty, undertaking
(except to the extent received and applied to the reduction by payment of the
Credit Party Obligations)or maximum liability of a guarantor or of any other
party as to the Credit Party Obligations of the Borrower, or (c) any payment on
or in reduction of any such other guaranty or undertaking, or (d) any
dissolution, termination or increase, decrease or change in personnel by the
Borrower, or (e) any payment made to the Administrative Agent or any Secured
Party on the Credit Party Obligations which the Administrative Agent or such
Secured Party repays the Borrower pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding, and
each of the Guarantors waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.
SECTION 10.4 INDEPENDENT OBLIGATION.
The obligations of each Guarantor hereunder are independent of the
obligations of any other Guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other Guarantor or the
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Borrower and whether or not any other Guarantor or the Borrower is joined in any
such action or actions.
SECTION 10.5 AUTHORIZATION.
Each of the Guarantors authorizes the Administrative Agent and each
Secured Party without notice or demand (except as shall be required by
applicable statute and cannot be waived), and without affecting or impairing its
liability hereunder, from time to time to (a) renew, compromise, extend,
increase, accelerate or otherwise change the time for payment of, or otherwise
change the terms of the Credit Party Obligations or any part thereof in
accordance with this Agreement and any Secured Hedging Agreement, as applicable,
including any increase or decrease of the rate of interest thereon, (b) take and
hold security from any Guarantor or any other party for the payment of this
Guaranty or the Credit Party Obligations and exchange, enforce waive and release
any such security, (c) apply such security and direct the order or manner of
sale thereof as the Administrative Agent and the Lenders in their discretion may
determine and (d) release or substitute any one or more endorsers, Guarantors,
the Borrower or other obligors.
SECTION 10.6 RELIANCE.
It is not necessary for the Administrative Agent or any Secured Party to
inquire into the capacity or powers of the Borrower or the officers, directors,
members, partners or agents acting or purporting to act on its behalf, and any
Credit Party Obligations made or created in reliance upon the professed exercise
of such powers shall be guaranteed hereunder.
SECTION 10.7 WAIVER.
(a) Each of the Guarantors waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or any Secured Party to (i) proceed against the
Borrower, any other guarantor or any other party, (ii) proceed against or
exhaust any security held from the Borrower, any other guarantor or any
other party, or (iii) pursue any other remedy in the Administrative
Agent's or any Secured Party's power whatsoever. Each of the Guarantors
waives any defense based on or arising out of any defense of the Borrower,
any other guarantor or any other party other than payment in full of the
Credit Party Obligations (other than contingent indemnity obligations),
including without limitation any defense based on or arising out of the
disability of the Borrower, any other guarantor or any other party, or the
unenforceability of the Credit Party Obligations or any part thereof from
any cause, or the cessation from any cause of the liability of the
Borrower other than payment in full of the Credit Party Obligations. The
Administrative Agent may, at its election, foreclose on any security held
by the Administrative Agent by one or more judicial or nonjudicial sales
(to the extent such sale is permitted by applicable law), or exercise any
other right or remedy the Administrative Agent or any Lender may have
against the Borrower or any other party, or any security, without
affecting or impairing in any way the liability of any Guarantor hereunder
except to the extent the Credit Party Obligations have been paid in full
and the Commitments have been terminated. Each of the Guarantors waives
any
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defense arising out of any such election by the Administrative Agent or
any of the Lenders, even though such election operates to impair or
extinguish any right of reimbursement or subrogation or other right or
remedy of the Guarantors against the Borrower or any other party or any
security.
(b) Each of the Guarantors waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notice of protest, notices of dishonor, notices of
acceptance of this Guaranty, and notices of the existence, creation or
incurring of new or additional Credit Party Obligations. Each Guarantor
assumes all responsibility for being and keeping itself informed of the
Borrower's financial condition and assets, and of all other circumstances
bearing upon the risk of nonpayment of the Credit Party Obligations and
the nature, scope and extent of the risks which such Guarantor assumes and
incurs hereunder, and agrees that neither the Administrative Agent nor any
Lender shall have any duty to advise such Guarantor of information known
to it regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise any
rights of subrogation which it may at any time otherwise have as a result
of this Guaranty (whether contractual, under Section 509 of the Bankruptcy
Code, or otherwise) to the claims of any Secured Party against the
Borrower or any other guarantor of the Credit Party Obligations of the
Borrower owing to such Secured Party (collectively, the "Other Parties")
and all contractual, statutory or common law rights of reimbursement,
contribution or indemnity from any Other Party which it may at any time
otherwise have as a result of this Guaranty until such time as the Credit
Party Obligations shall have been paid in full and the Commitments have
been terminated. Each of the Guarantors hereby further agrees not to
exercise any right to enforce any other remedy which the Administrative
Agent or any Secured Party now have or may hereafter have against any
Other Party, any endorser or any other guarantor of all or any part of the
Credit Party Obligations of the Borrower and any benefit of, and any right
to participate in, any security or collateral given to or for the benefit
of the Secured Parties to secure payment of the Credit Party Obligations
of the Borrower until such time as the Credit Party Obligations (other
than contingent indemnity obligations) shall have been paid in full and
the Commitments have been terminated.
SECTION 10.8 LIMITATION ON ENFORCEMENT.
The Secured Parties agree that this Guaranty may be enforced only by the
action of the Administrative Agent acting upon the instructions of the Required
Secured Parties and that no Secured Party shall have any right individually to
seek to enforce or to enforce this Guaranty, it being understood and agreed that
such rights and remedies may be exercised by the Administrative Agent for the
benefit of the Secured Parties under the terms of this Credit Agreement and
under any Secured Hedging Agreement. The Secured Parties further agree that this
Guaranty may not be enforced against any director, officer, employee or
stockholder of the Guarantors.
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SECTION 10.9 CONFIRMATION OF PAYMENT.
The Administrative Agent and the Lenders will, upon request after payment
of the indebtedness and obligations which are the subject of this Guaranty and
termination of the Commitments relating thereto, confirm to the Borrower, the
Guarantors or any other Person that such indebtedness and obligations have been
paid and the Commitments relating thereto terminated, subject to the provisions
of Section 10.2.
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IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement
to be duly executed and delivered by its proper and duly authorized officers as
of the day and year first above written.
BORROWER: GENCORP, INC.,
an Ohio corporation
By: /s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Title: Vice President, Treasurer
GUARANTORS: AEROJET-GENERAL CORPORATION,
an Ohio corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
AEROJET ORDNANCE TENNESSEE, INC.,
a Tennessee corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Treasurer
AEROJET FINE CHEMICALS LLC,
a Delaware limited liability company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Treasurer
ADMINISTRATIVE AGENT
AND LENDERS: WACHOVIA BANK, NATIONAL
ASSOCIATION,
as Administrative Agent and as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
[SCHEDULES INTENTIONALLY OMITTED]