Exhibit 99.1
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THIRD AMENDED AND RESTATED CREDIT AGREEMENT
dated as of November 3, 1995
among
SOUTHDOWN, INC.,
as Borrower,
THE FINANCIAL INSTITUTIONS SIGNATORY HERETO,
as Banks,
and
▇▇▇▇▇ FARGO BANK, N.A.,
as Agent
$200,000,000
This THIRD AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of
N o v e m ber 3, 1995, among SOUTHDOWN, INC., a Louisiana corporation
("Borrower"), on the one hand, and, on the other hand, the financial
institutions which either now or in the future are signatories hereto
(collectively referred to as "Banks" and individually as a "Bank"), and ▇▇▇▇▇
FARGO BANK, N.A., a national banking association, as agent (hereinafter, in
such capacity, together with any successors thereto in such capacity,
referred to as "Agent") for Banks hereunder.
RECITALS
WHEREAS, Borrower, certain Banks, and Agent are parties to that certain
Credit Agreement dated as of April 5, 1988, that has been amended pursuant to
that certain Amendment Number One to Credit Agreement dated as of May 18,
1988, that certain Amendment Number Two to Credit Agreement dated as of June
17, 1988, that certain Amendment Number Three to Credit Agreement dated as of
August 25, 1988, that certain Amendment Number Four to Credit Agreement dated
as of September 23, 1988, that certain Amendment Number Five to Credit
Agreement dated as of December 31, 1988, that certain Amendment Number Six to
Credit Agreement dated as of December 31, 1988, that certain Amendment Number
Seven to Credit Agreement dated as of April 28, 1989, that certain Amendment
Number Eight to Credit Agreement dated as of May 22, 1989, that certain
Amendment Number Nine to Credit Agreement dated as of September 1, 1989, that
certain Amendment Number Ten to Credit Agreement dated as of October 31,
1989, that certain Amendment Number Eleven to Credit Agreement dated as of
May 11, 1990, that certain Amendment Number Twelve to Credit Agreement dated
as of June 27, 1990, and that certain Amendment Number Thirteen to Credit
Agreement dated as of March 28, 1991 (as amended, the "1988 Credit
Agreement");
WHEREAS, Borrower, certain Banks, and Agent are parties to that certain
Amended and Restated Credit Agreement, dated as of April 30, 1991, which
amended and restated the 1988 Credit Agreement in its entirety and that has
been amended pursuant to that certain Amendment Number One to Credit
Agreement dated as of June 14, 1991, that certain Amendment Number Two to
Credit Agreement dated as of September 27, 1991, that certain Amendment
Number Three to Credit Agreement dated as of October 31, 1991, that certain
Amendment Number Four to Credit Agreement dated as of March 6, 1992, that
certain Amendment Number Five to Credit Agreement dated as of December 18,
1992, that certain Amendment Number Six to Credit Agreement dated as of June
8, 1993, and that certain Amendment Number Seven to Credit Agreement dated as
of September 8, 1993 (as amended, the "1991 Credit Agreement");
WHEREAS, Borrower, certain Banks, and Agent are parties to that certain
Second Amended and Restated Credit Agreement, dated as of November 19, 1993,
which amended and restated the 1991 Credit Agreement in its entirety and that
has been amended pursuant to that certain Amendment Number One to Credit
Agreement dated as of February 18, 1994 and that certain Amendment Number Two
to Credit Agreement dated as of December 20, 1994 (as amended, the "1993
Credit Agreement");
WHEREAS, Borrower has requested from Banks and Agent the restructuring
of the credit facilities provided pursuant to the 1993 Credit Agreement.
Banks and Agent have agreed to restructure the credit facilities on the terms
and conditions set forth herein; and
WHEREAS, Borrower, Banks, and Agent have agreed to amend and restate the
1993 Credit Agreement in its entirety as set forth herein.
In consideration of the foregoing and the mutual covenants, conditions,
and provisions hereinafter set forth, the parties hereto amend and, as so
amended, restate in its entirety the 1993 Credit Agreement, and agree as
follows:
ARTICLE 1.
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions. For purposes of this Agreement, the
following capitalized terms shall have the following meanings:
"ABN-AMRO Letter of Credit" means and refers to that
certain letter of credit issued by ABN-AMRO Bank for the account of Borrower
in a face amount equal to approximately Nine Million Three Hundred Thousand
Dollars ($9,300,000).
"Acquired Indebtedness" means Debt of a Person existing
at the time such Person becomes a Subsidiary or assumed in connection with
the acquisition of Assets from such Person, and not incurred in connection
with, or in anticipation of, such Person becoming a Subsidiary or such
acquisition.
"Affiliate" means and refers to, as applied to any
Person, any other Person directly or indirectly controlling, controlled by,
or under common control with, that Person. For the purposes of this
definition, the terms "controlling," "controlled by," and "under common
control with", as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and policies of that Person, whether through the ownership of voting
securities, by contract, or otherwise.
" A gent" shall have the meaning set forth in the
introduction to this Agreement.
"Agent's Fees" shall mean those fees that have been
separately agreed upon between Borrower and Agent, which fees shall be for
the sole account of Agent.
"Agent's Fee Letter" shall mean that certain letter,
dated as of September 18, 1995, from Agent to Borrower, setting forth, among
other items, the Agent's Fees.
"Agreement" means and refers to this Third Amended and
Restated Credit Agreement between Borrower, on the one hand, and Agent and
Banks, on the other hand, together with all exhibits and schedules hereto.
"Ancillary Documents" means and refers to the Loan
Documents.
"Applicable Base Rate Margin" means and refers to, with
respect to Base Rate Loans,
Leverage Ratio Applicable Base Rate Margin
greater than or 1.00 percentage points
equal to 2.75:1.0
less than 2.75:1.0 but 0.50 percentage points
greater than or
equal to 2.25:1.0
less than 2.25:1.0, 0.25 percentage points
but greater than or
equal to 1.75:1.0
less than 1.75:1.0, 0.00 percentage points
but greater than or
equal to 1.25:1.0
less than 1.25:1.0, 0.00 percentage points
but greater than or
equal to .75:1.0
less than .75:1.0 0.00 percentage point
The Applicable Base Rate Margin shall be based upon the
Borrower's Leverage Ratio which will be calculated quarterly as at the end of
each fiscal quarter of the Borrower based upon the four (4) immediately
preceding fiscal quarters, including the quarter then ended. The applicable
margin shall be redetermined quarterly on the date Agent receives quarterly
financial statements pursuant to Section 5.2(a) hereof, (or, in the case of
the fourth fiscal quarter in each fiscal year, a certification by the chief
financial officer or treasurer of Borrower).
"Applicable Commercial Letter of Credit Margin" means and
refers to, with respect to Commercial Letters of Credit,
Leverage Ratio Applicable Commercial Letter
of Credit Margin
greater than or
equal to 2.75:1.0 .35 percentage points
less than 2.75:1.0,
but greater than or
equal to 2.25:1.0 .30 percentage points
less than 2.25:1.0,
but greater than or
equal to 1.75:1.0 .25 percentage points
less than 1.75:1.0,
but greater than or
equal to 1.25:1.0 .20 percentage points
less than 1.25:1.0,
but greater than or
equal to .75:1.0 .15 percentage points
less than .75:1.0 .125 percentage points
The Applicable Commercial Letter of Credit Margin shall
be based upon the Borrower's Leverage Ratio which will be calculated
quarterly as at the end of each fiscal quarter of the Borrower based upon the
four (4) immediately preceding fiscal quarters, including the quarter then
ended. The applicable margin shall be redetermined quarterly on the date
Agent receives quarterly financial statements pursuant to Section 5.2(a)
hereof, (or, in the case of the fourth fiscal quarter in each fiscal year, a
certification by the chief financial officer or treasurer of Borrower).
Anything to the contrary contained herein notwithstanding, there shall not be
any increase to, or refund of, any letter of credit fee previously paid with
respect to a Commercial Letter of Credit that is outstanding on the day on
which the Applicable Commercial Letter of Credit Margin changes.
"Applicable Commitment Fee Percentage" means and refers
to, with respect to the calculation of the Commitment Fee provided for in
Section 2.13 hereof,
Leverage Ratio Applicable Commitment Fee
Percentage
greater than or 0.50 percentage points
equal to 2.75:1.0
less than 2.75:1.0, 0.375 percentage points
but greater than or
equal to 2.25:1.0
less than 2.25:1.0, 0.300 percentage points
but greater than or
equal to 1.75:1.0
less than 1.75:1.0, 0.250 percentage points
but greater than or
equal to 1.25:1.0
less than 1.25:1.0, 0.250 percentage points
but greater than or
equal to .75:1.0
less than .75:1.0 0.225 percentage points
The Applicable Commitment Fee Percentage shall be based
upon Borrower's Leverage Ratio which will be calculated quarterly as at the
end of each fiscal quarter of Borrower based upon the four (4) immediately
preceding fiscal quarters, including the quarter then ended. The applicable
percentage shall be redetermined quarterly on the date Agent receives
quarterly financial statements pursuant to Section 5.2(a) hereof, (or, in the
case of the fourth fiscal quarter in each fiscal year, a certification by the
chief financial officer or treasurer of Borrower).
"Applicable LIBOR Rate Margin" means and refers to,
Leverage Ratio Applicable LIBOR Rate Margin
greater than or 2.125 percentage points
equal to 2.75:1.0
less than 2.75:1.0,
but greater than or 1.625 percentage points
equal to 2.25:1.0
less than 2.25:1.0,
but greater than or 1.25 percentage points
equal to 1.75:1.0
less than 1.75:1.0,
but greater than or 1.00 percentage points
equal to 1.25:1.0
less than 1.25:1.0,
but greater than or .75 percentage points
equal to .75:1.0
less than .75:1.0 .50 percentage points
The Applicable LIBOR Rate Margin shall be based upon the
Borrower's Leverage Ratio which will be calculated quarterly as at the end of
each fiscal quarter of the Borrower based upon the four (4) immediately
preceding fiscal quarters, including the quarter then ended. The applicable
margin shall be redetermined quarterly on the date Agent receives quarterly
financial statements pursuant to Section 5.2(a) hereof, (or, in the case of
the fourth fiscal quarter in each fiscal year, a certification by the chief
financial officer or treasurer of Borrower). Anything to the contrary
contained herein notwithstanding, (a) any LIBOR Rate Loan that is outstanding
on the day on which the Applicable LIBOR Rate Margin changes, shall, until
the end of the Interest Period relating to such LIBOR Rate Loan, continue to
bear interest at the Applicable LIBOR Rate Margin that was in effect on the
date such LIBOR Rate Loan was made, and (b) the letter of credit fee with
respect to any Letter of Credit (other than a Commercial Letter of Credit)
that is outstanding on the day on which the Applicable LIBOR Rate Margin
changes, automatically shall be adjusted as of the date on which the
Applicable LIBOR Rate Margin is adjusted.
"Asset" means and refers to any interest in any kind of
property or asset, whether real, personal, or mixed, tangible or intangible.
"Asset Acquisition" means and refers to the acquisition
of all or substantially all of the Assets of a Person.
"Assignment and Assumption Agreement" means an Assignment
and Assumption Agreement among an assigning Bank, such Bank's assignee
thereunder, Borrower, and Agent, substantially in the form of Exhibit A-1
attached hereto.
"Bank" and "Banks" shall have the respective meanings set
forth in the introduction to this Agreement.
"Base LIBOR Rate" means the average of the rate per annum
at which Dollar deposits are offered to Agent in the London interbank
e u rocurrency market on the second LIBOR Business Day prior to the
commencement of an Interest Period at or about 11:00 A.M. (London time), for
delivery on the first day of such Interest Period, for a term comparable to
the number of days in such Interest Period and in an amount approximately
equal to the principal amount to which such Interest Period shall apply.
"Base Rate" means, for any day, the higher of (a) the
Federal Funds Rate in effect on such day plus 0.50%, and (b) the Prime Rate.
Each change in the interest rate on the Loans based on a change in the Base
Rate shall be effective as of the effective date of such change in the Base
Rate.
"Base Rate Borrowing" means and refers to any Borrowing
designated by Borrower as a Base Rate Borrowing pursuant to Sections 2.8 and
2.9 of this Agreement or any Loans deemed to be a Base Rate Borrowing
pursuant to Section 2.9 of this Agreement.
"Base Rate Loan" means each portion of a Loan bearing
interest at a rate determined by reference to the Base Rate.
"Board of Directors" means the Board of Directors of
Borrower or any committee thereof duly authorized to act on behalf of the
Board of Directors.
"Borrower" shall have the meaning set forth in the
introduction to this Agreement.
"Borrower Common Stock" means and refers to the common
stock of Borrower.
"Borrowing" means and refers to a borrowing under this
Agreement consisting of Loans made severally by each Bank to Borrower.
"Brooksville Plant" means and refers to that certain
cement plant of Borrower located at or near Brooksville, Florida, including
(a) all interests and estates of Borrower in real property on which such
cement plant is located, including improvements, buildings, and structures
located thereon, (b) all interests and estates of Borrower in real property
related to or used in connection with the operation of such cement plant,
such as related quarries, parking or storage areas, Related Terminals, or
rights of way, including improvements, buildings, and structures located
thereon, and (c) all tangible and intangible interests of Borrower in
personal property constituting part of or integral to the use or operation of
such cement plant, such as fixtures, machinery, equipment, licenses, permits,
operating and maintenance agreements, and related books and records (but
excluding accounts, inventory, and proceeds thereof).
"Capital Expenditures" means and refers to, when used in
connection with any Person for any period, any expenditure by such Person
that, in conformity with GAAP, has been or should be included in the
additions to property, plant, and equipment or in acquisitions, net of cash
acquired, in each case, as reflected in such Person's statement of
consolidated cash flows for such period prepared on substantially the same
basis as Borrower's statement of consolidated cash flows for its fiscal year
ended December 31, 1994.
"Capitalized Lease" means and refers to any lease of
property (whether real, personal, or mixed real and personal) by a Person as
lessee that should, in conformity with GAAP, be accounted for as a capital
lease on the balance sheet of that Person.
"Capitalized Lease Obligations" means and refers to any
and all lease obligations that, in accordance with GAAP, have been or are
required to be capitalized on the books of a lessee.
"Capital Stock" of any Person means any and all shares,
interests, participations, or other equivalents (however designated) of, or
rights, warrants, or options to purchase, corporate stock or any other equity
interest (however designated) of or in such Person.
"Cash Equivalents" means and refers to: (a) marketable
direct obligations issued or unconditionally guaranteed by the United States
Government or issued by any agency thereof and backed by the full faith and
credit of the United States, in each case maturing within one (1) year from
the date of acquisition thereof; (b) marketable direct obligations issued by
any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof maturing within one (1) year
from the date of acquisition thereof and, at the time of acquisition, having
the highest rating obtainable from either S&P or ▇▇▇▇▇'▇; (c) commercial
paper maturing no more than one (1) year from the date of acquisition thereof
and, at the time of acquisition, having a rating of A-2 or P-2, or better,
from S&P or ▇▇▇▇▇'▇; (d) certificates of deposit or bankers' acceptances
maturing within one (1) year from the date of acquisition thereof either
(i) issued by any of the Banks or any bank organized under the laws of the
United States of America or any state thereof or the District of Columbia
which Bank or other bank has a rating of A or A2, or better, from S&P or
▇▇▇▇▇'▇, or (ii) certificates of deposit less than or equal to One Hundred
Thousand Dollars ($100,000) in the aggregate issued by any other bank insured
by the Federal Deposit Insurance Corporation.
"Cement Plants" means and refers to the Brooksville
Plant, the Fairborn Plant, the Knoxville Plant, the ▇▇▇▇▇ Plant, the Odessa
Plant, and the Victorville Plant.
" C E R C LA" means and refers to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
from time to time (by ▇▇▇▇ or otherwise), set forth at 42 U.S.C.
Section 9601-9657, and all rules and regulations promulgated thereunder as of
the date hereof.
"Change of Control" means and refers to the occurrence of
one or more of the following events: (a) any sale, lease, exchange, or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the Assets of Borrower to any Person or related group
for purposes of Section 13(d) of the Exchange Act (a "Group"), together with
any Affiliates thereof, (b) the shareholders of Borrower shall approve any
plan or proposal for the liquidation or dissolution of Borrower, (c) any
Person or Group, together with any Affiliates thereof, shall, as a result of
a tender or exchange offer, a merger, consolidation or similar transaction,
open market purchases, privately negotiated purchases, or otherwise, have
become the beneficial owner (within the meaning of Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of Borrower representing
at least thirty percent (30%) of the Voting Stock of Borrower, or (d) a
majority of the members of the Board of Directors shall not constitute
Continuing Directors. For purposes of this definition, "Board of Directors"
does not include any committee thereof.
"Closing Date" means and refers to the date of the first
Borrowing under this Agreement.
"Code" means and refers to the Internal Revenue Code of
1986, as amended from time to time, or any successor or superseding tax laws
of the United States of America, together with all regulations promulgated
thereunder.
"Collateral" means and refers to (a) the interests of
Borrower in the capital stock of Mojave, (b) the interests of Borrower in and
to the Cement Plants (other than the Brooksville Plant) and the interest of
Borrower in KCC (subject to any exclusions contained in the applicable
security documents), and (c) the interests of Mojave in its equipment,
fixtures, and certain of its general intangibles (subject to any exclusions
contained in the applicable security agreement).
"Collateral Release Agreement" means and refers to an
agreement, substantially in the form of Exhibit C-1 attached hereto, among
Agent, Borrower, and each of the Specified Subsidiaries, pursuant to which
Agent agrees to the release of (a) its Liens in the Capital Stock of each of
the Specified Subsidiaries (other than Mojave) and of City Concrete Products,
Inc., (b) its Liens in and to the Assets of each of the Specified
Subsidiaries (other than Mojave), (c) its Liens in and to the accounts,
inventory, chattel paper, instruments (other than the Capital Stock of
Mojave), and certain general intangibles (other than the interest of Borrower
in and to KCC) of Borrower and Mojave, (d) its Liens in the Florida
Collateral, and (e) the guaranties previously executed and delivered by each
of the Specified Subsidiaries (other than the Mojave Guaranty).
"Commercial Letter of Credit" means and refers to any
sight letter of credit issued hereunder for the purpose of supporting
Borrower's obligations incurred in the ordinary course of business and which
is conditioned upon the presentation of documents (as that term is defined in
Section 5103(b) of the UCC).
"Commercial Paper Letters of Credit" means and refers to,
depending on the context, any or all of the Letters of Credit issued pursuant
to the terms of Sections 2.1(b) or 2.2 of this Agreement for the purpose of
supporting commercial paper issued by Borrower.
"Commercial Paper Letter of Credit Amount" means and
refers to an amount equal to Seventy-Five Million Dollars ($75,000,000).
"Commercial Paper Letter of Credit Usage" means and
refers to, as of the date any determination thereof is to be made, the sum
of: (a) the Stated Amount of each Commercial Paper Letter of Credit then
outstanding; and (b) the aggregate amount of all Unpaid Drawings with respect
to Commercial Paper Letters of Credit. For purposes of this definition, any
amount described which is denominated in a currency other than Dollars shall
be valued in Dollars based on the applicable Exchange Rate for such currency
as of the date of determination.
"Commitment Fee" shall have the meaning set forth in
Section 2.13 of this Agreement.
"Consolidated Current Assets" means and refers to the
total of all Assets of Borrower and its Subsidiaries that have been or
properly should be classified as current assets in accordance with GAAP and
determined on a consolidated basis.
"Consolidated Current Liabilities" means and refers to
the total of all of the liabilities of Borrower and its Subsidiaries that
have been or properly should be classified as current liabilities in
accordance with GAAP and determined on a consolidated basis.
"Consolidated EBITDA" means and refers to, for any
period, an amount for Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP, equal to (a) operating earnings,
plus or minus, as applicable (b) consolidated non-cash charges to the extent
that such charges were included in the calculation of operating earnings.
"Consolidated Net Income" means and refers to, for any
period, the net income (or deficit) of Borrower and its Subsidiaries for such
period (on a consolidated basis), after deducting portions of income properly
attributable to minority interests, if any, in the stock and surplus of such
Subsidiaries; provided, however, that there shall be excluded: (a) the
income (or deficit) of any Person accrued prior to the date it becomes a
Subsidiary of Borrower or is merged into or consolidated with Borrower or any
of its Subsidiaries or such Person's Assets are acquired by Borrower or any
of its Subsidiaries; (b) the income (or deficit) of any Person (other than a
Subsidiary of Borrower) in which Borrower or any of its Subsidiaries has an
ownership interest, except to the extent that any such income has been
actually received by Borrower or such Subsidiary in the form of dividends,
management fees, or other distributions, loans, or other mechanisms to
achieve the economic benefit to Borrower of dividends; and (c) the
undistributed earnings of any Subsidiary of Borrower to the extent that the
declaration or payment of dividends or other distributions, loans, or other
mechanisms to achieve the economic effect to Borrower of dividends by such
Subsidiary is not at the time permitted by the terms of its charter or any
a g r e e ment, instrument, judgment, decree, order, statute, rule, or
governmental regulation applicable to such Subsidiary.
"Consolidated Tangible Net Worth" means and refers to, on
the date of determination thereof, the amount calculated as: (a) the
consolidated stockholders' equity of Borrower and its Subsidiaries plus the
aggregate amount of Permitted Preferred Stock to the extent not already
included in consolidated stockholders' equity, minus (b) the consolidated
aggregate amount of Intangible Assets of Borrower and its Subsidiaries.
"Contingent Obligation" means and refers to, as to any
Person and without duplication of amounts, any obligation of such Person
guaranteeing or intended to guarantee (whether guaranteed, endorsed, co-made,
discounted, or sold with recourse to such Person) any Debt, Noncancellable
Lease, dividend, reimbursement obligations relating to letters of credit, or
any other obligation that pertains to Debt, a Noncancellable Lease, a
dividend, or a reimbursement obligation related to letters of credit (each, a
"primary obligation") of any other Person ("primary obligor") in any manner,
whether directly or indirectly, including any obligation of such Person,
irrespective of whether contingent, (a) to purchase any such primary
obligation, (b) to advance or supply funds (whether in the form of a loan,
advance, stock purchase, capital contribution, or otherwise) (i) for the
purchase, repurchase, or payment of any such primary obligation or any Asset
constituting direct or indirect security therefor, or (ii) to maintain
working capital or equity capital of the primary obligor, or otherwise to
maintain the net worth, solvency, or other financial condition of the primary
obligor, (c) to purchase or make payment for any Asset, securities, services,
or Noncancellable Lease if primarily for the purpose of assuring the owner of
any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation, or (d) to otherwise assure or hold
harmless the owner of such primary obligation against loss in respect
thereof; provided, however, that the term Contingent Obligation shall not
include (y) trade payables or accrued liabilities of the Person making the
Contingent Obligation, or (z) non-pension post retirement benefits. The
amount of any Contingent Obligation of any Person shall be deemed to be an
amount equal to the net present value of the maximum amount of such Person's
liability with respect to the stated or determinable amount of the primary
obligation for which such Contingent Obligation is incurred or, if not stated
or determinable, the net present value of the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined, reasonably and in good faith, by Borrower.
"Continuing Director" means and refers to (a) any member
of the Board of Directors who was a director of Borrower on the Closing Date,
and (b) any person who becomes a member of the Board of Directors after the
Closing Date if such person was appointed or nominated for election to the
Board of Directors by a majority of the Continuing Directors, but excluding
any such person originally proposed for election in opposition to the Board
of Directors in office at the Closing Date in an actual or threatened
election contest relating to the election of the directors of Borrower (as
such terms are used in Rule 14a-11 under the Exchange Act) and whose initial
assumption of office resulted form such contest or the settlement thereof.
"Contractual Obligation" means and refers to, as applied
to any Person, any provision of any security issued by that Person or of any
m a t erial indenture, mortgage, deed of trust, contract, undertaking,
agreement, or other instrument to which that Person is a party or by which it
or any of its owned Assets is bound or to which it or any of its owned Assets
is subject.
"Controlled Group" means and refers to all domestic and
foreign members of a controlled group of corporations under Section 1563(a) of
the Code (determined without regard to Section 1563(b)(2)(c) of the Code) and
all trades or businesses (irrespective of whether incorporated) under common
control of Borrower or its Subsidiaries.
"Damages" means and refers to those damages set forth in
42 U.S.C.Section 9601, 42 U.S.C. Section 9607(a), and 42 U.S.C.Section 9611(b).
"Debt" means and refers to, with respect to any Person,
the aggregate amount of, without duplication: (a) all indebtedness for
borrowed money; (b) all indebtedness evidenced by bonds, debentures, notes,
or other similar instruments; (c) all Capitalized Lease Obligations; (d) all
indebtedness of others secured by a Lien on any Asset of such Person,
irrespective of whether such indebtedness is assumed; and (e) any obligation
owed for all or any part of the deferred purchase price of Assets or services
that is due more than twelve (12) months from the date of the incurrence of
the obligation in respect thereto.
"Defaulting Bank" shall have the meaning ascribed thereto
in Section 2.10(c).
" D i s closure Statement" means and refers to that
statement, executed and delivered by a Responsible Officer of Borrower
pursuant to Section 3.1(b) hereof, as amended from time to time to the extent
permitted hereby, which statement sets forth information regarding, or
exceptions to, the representations, warranties, and covenants made by
Borrower herein. The Disclosure Statement may be amended, from time to time,
to reflect Borrower's formation or acquisition of new Subsidiaries or other
changes so long as the amendment contains the relevant information as would
have been required hereunder as of the Closing Date and so long as such
amendment does not disclose violations of the covenants contained in this
Agreement and so long as Borrower, or the relevant Subsidiary, as and if
applicable, complies with the provisions of Section 5.11 hereof in connection
with such amendment.
"Dollars and $" means and refers to United States of
America dollars or such coin or currency of the United States of America as
at the time of payment shall be legal tender for the payment of public and
private debts in the United States of America.
"Domestic Business Day" means and refers to a day (other
than a Saturday or Sunday) on which major commercial banks are open for
business in San Francisco, California, Houston, Texas, and New York, New
York.
"Environment" shall have the meaning set forth in 42
U.S.C. Section 9601(8).
"Environmental Protection Statute" means and refers to
any local, state, or federal law, statute, regulation, or ordinance enacted
in connection with or relating to the protection or regulation of the
Environment, including those laws, statutes, and regulations regulating the
disposal, removal, production, storing, refining, handling, transferring,
p r o cessing, discharge, emission, release, investigation, remediation,
cleanup, use, treatment, or transporting of Hazardous Waste or Hazardous
S u b s tances, regulating the discharge or emission of pollutants or
contaminants into water or air, regulating industrial health and safety, and
protecting human health, and any regulations, issued or promulgated in
connection with such statutes by any governmental agency or instrumentality.
"EPA" means and refers to the United States Environmental
Protection Agency, or any successor thereto.
"ERISA" means and refers to the Employee Retirement
Income Security Act of 1974, as the same may from time to time be amended or
supplemented, including any rules or regulations issued in connection
therewith.
"ERISA Affiliate" means and refers to, as to any Person,
any trade or business (irrespective of whether incorporated) that is a member
of a group of which such Person is a member (determined immediately following
the Closing Date and thereafter) and that is under common control within the
meaning of the regulations promulgated under Section 414 of the Code (except
that such rules and regulations also shall be deemed to apply to
foreign corporations).
"Event of Default" shall have the meaning set forth in
Section 7.1 of this Agreement.
"Exchange Act" means and refers to the Securities
Exchange Act of 1934, as amended from time to time, and any successor
statute, and the rules and regulations thereunder.
"Exchange Subordinated Debt" means and refers to the
Borrower's 7 1/2% Convertible Subordinated Debentures, due 2013, that are
issuable, at the option of Borrower, in exchange for the Series B Preferred
Stock.
"Exchange Rate" means and refers to the nominal rate of
exchange of Issuing Bank in a chosen foreign exchange market for the purchase
by Issuing Bank, by cable or transfer of any currency other than Dollars at
12:00 noon, local time, one Domestic Business Day prior to any date of
determination, expressed as the number of units of such currency per one (1)
Dollar.
"Existing Subordinated Debt" means and refers to the Debt
of Borrower evidenced by the Senior Subordinated Notes.
"Fairborn Plant" means and refers to that certain cement
plant of Borrower located at or near Fairborn, Ohio, including (a) all
interests and estates of Borrower in real property on which such cement plant
is located, including improvements, buildings, and structures located
thereon, (b) all interests and estates of Borrower in real property related
to or used in connection with the operation of such cement plant, such as
related quarries, parking or storage areas, Related Terminals, or rights of
way, including improvements, buildings, and structures located thereon, and
(c) all tangible and intangible interests of Borrower in personal property
constituting part of or integral to the use or operation of such cement
plant, such as fixtures, machinery, equipment, licenses, permits, operating
and maintenance agreements, and related books and records (but excluding
accounts, inventory, and proceeds thereof).
"Federal Funds Rate" means, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100th of 1%) equal to
the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by federal funds brokers
on such day as published by the Federal Reserve Bank of New York on the
Domestic Business Day immediately following such day; provided, however, that
(a) if the day for which such rate is to be determined is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the immediately preceding Domestic Business Day as published
on the immediately following Domestic Business Day, and (b) if such rate is
not published for any Domestic Business Day, then the Federal Funds Rate
shall be the average of the quotations for such day on such transactions
received by Agent from three (3) federal funds brokers of recognized standing
selected by Agent.
"Federal Reserve Board" means and refers to the Board of
Governors of the Federal Reserve System or any successor thereto.
"Florida Collateral" means and refers to the interests of
Borrower in real property, equipment, and fixtures situate in the State of
Florida, including the Brooksville Plant.
"Foreign Bank" means and refers to any Bank other than a
Bank organized and existing under the laws of the United States of America or
any political subdivision thereof or therein.
"Free Cash Flow Ratio" means and refers to, for the
period to be determined, the ratio of (a) Consolidated EBITDA minus Capital
Expenditures, to (b) the sum of cash Interest Expense, current provision for
income taxes, dividends, and the current portion of Funded Debt as of the
last day of such period (exclusive of Debt under this Agreement, the
Subordinated Debt (to the extent that it is redeemed, repurchased, exchanged,
or refinanced), and the Debt evidenced by the Pollution Control Bonds). For
purposes of calculating the Free Cash Flow Ratio, Capital Expenditures shall
be calculated (a) as of December 31, 1996 exclusive of Capital Expenditures,
up to a maximum amount of $40,000,000, incurred or expended in connection
with improvements made to the Fairborn Plant, (b) as of December 31, 1997
exclusive of Capital Expenditures, up to a maximum amount of $40,000,000 less
the amount excluded during fiscal year 1996, incurred or expended in
connection with improvements made to the Fairborn Plant, (c) exclusive of
Capital Expenditures incurred or expended in connection with the consummation
of a Permitted Acquisition to the extent that Borrower consummates such
Permitted Acquisition with the Net Issuance Proceeds of Qualified Offerings
that were raised for the express purpose of consummating such Permitted
Acquisition, (d) exclusive of Capital Expenditures incurred or expended to
the extent of Net Issuance Proceeds of Qualified Offerings obtained by
Borrower in the applicable fiscal year; provided, however, that such
exclusion shall not reduce Capital Expenditures to less than $25,000,000 in
any fiscal year and, if any balance thereof remains, such balance may be used
to reduce Capital Expenditures in the next succeeding fiscal year (but not
any subsequent fiscal year) and the utilization of such balance shall not
reduce Capital Expenditures in such succeeding fiscal year to less than
$25,000,000, and (e) as of any fiscal quarter ending March 31, June 30, or
September 30 of any fiscal year, as being equal to $25,000,000 for the four
(4) immediately preceding fiscal quarters (including the quarter then ended),
irrespective of the actual amount of Capital Expenditures. In order to take
advantage of any of such exclusions, Borrower shall be required to designate
the calculation thereof to Agent in connection with the delivery of the
Officer's Compliance Certificate pursuant to Section 5.2(f).
"Fund," "Trust Fund," or "Super Fund" means and refers to
the Hazardous Substance Response Trust Fund, established pursuant to 42
U.S.C. Section9631 and the Post-closure Liability Trust Fund, established
pursuant to 42 U.S.C. Section 9641. The above provisions have been amended or
repealed by ▇▇▇▇ and the "Fund," "Trust Fund," or "Super Fund" are now
maintained pursuant to Section 9507 of the Code.
"Funded Debt" means and refers to all consolidated Debt
of Borrower or its Subsidiaries that matures one (1) year or more from the
date of issuance, or that is renewable or extendable, at the sole option of
Borrower or its Subsidiaries, as applicable, by its terms or by the terms of
any instrument or agreement relating thereto to a date that is one (1) year
or more from the date of issuance thereof, or that, under a revolving credit
or similar agreement, obligates the lender to extend credit over a period of
one (1) year or more from the date of issuance.
"GAAP" means and refers to generally accepted accounting
principles recognized as such by the American Institute of Certified Public
Accountants in the opinions and pronouncements of the Accounting Principles
Board and statements and pronouncements of the Financial Accounting Standards
Board or in such other statements by such other entity as may be approved by
a significant segment of the accounting profession, that are applicable to
the circumstances as of the date of determination.
"Governmental Authority" means and refers to any federal,
state, local, or other governmental department, commission, board, bureau,
agency, central bank, court, tribunal, or other instrumentality, domestic or
foreign.
"Hazardous Substances" shall have the meaning set forth
in 42 U.S.C.Section 9601(14); provided, however, that the exclusions set
forth therein shall not apply.
"Hazardous Waste" shall have the meaning set forth in 42
U.S.C. Section 6903(5), and 40 C.F.R. Section 261.3.
"Hedge Agreements" means and refers to any interest rate
swap agreement, interest rate cap agreement, commodity or foreign currency
h e dge, option, or future contracts, or other similar agreements or
arrangements entered into by Borrower.
"Highest Lawful Rate" means and refers to, with respect
to any Bank, the maximum non-usurious interest rate, as in effect from time
to time, that may be charged, contracted for, reserved, received, or
collected by such Bank in connection with this Agreement or the Notes, or any
of the Loan Documents.
"Indemnified Liabilities" shall have the meaning set
forth in Section 10.2 of this Agreement.
"Indemnitees" shall have the meaning set forth in Section
10.2 of this Agreement.
"Intangible Assets" means and refers to, with respect to
any Person, that portion of the book value of all of such Person's Assets
that would be treated as intangibles under GAAP.
"Interest Expense" means and refers to, with respect to
any period of determination, the total consolidated interest expense,
determined in accordance with GAAP, of Borrower and its Subsidiaries.
"Interest Payment Date" means and refers to, with respect
to any LIBOR Rate Loan, the last day of each Interest Period applicable to
such Loan; provided, however, that in the case of any Interest Period in
excess of three (3) months, "Interest Payment Date" also shall include the
end of each three-month period following the commencement of that Interest
Period.
"Interest Period" means, with respect to each LIBOR Rate
Borrowing, the period commencing on the date of such LIBOR Rate Borrowing and
ending one (1), two (2), three (3), or, subject to the availability of funds,
six (6) months thereafter, as Borrower may elect pursuant to the applicable
Notice of Borrowing or Notice of Conversion/Continuation; provided, however,
that:
(a) any Interest Period that would otherwise end on
a day that is not a LIBOR Business Day shall be extended to the next
succeeding LIBOR Business Day unless such LIBOR Business Day falls in
another calendar month, in which case such Interest Period shall end on
the next preceding LIBOR Business Day;
(b) any Interest Period that begins on the last
LIBOR Business Day of the 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, subject to clause (c), end on the last
LIBOR Business Day of the calendar month in which it would have ended if
there were a numerically corresponding day in such calendar month; and
(c) if any Interest Period includes a date on which
a payment of principal of any Loan is required to be made under this
Agreement, but does not begin or end on such date, then (x) the
principal amount of such LIBOR Rate Borrowing required to be repaid on
such date shall have an Interest Period ending on such date; and (y) the
remainder (if any) of such LIBOR Rate Borrowing shall have an Interest
Period determined as set forth in the lead-in to this definition;
provided, however, that the foregoing shall not be deemed to relieve
Borrower from any of its obligations under Section 2.15.
"Investment" means and refers to, as applied to any
Person, any direct or indirect purchase or other acquisition by that Person
of stock or other securities of any other Person or any beneficial interest
therein, or any direct or indirect loan, advance, or capital contribution by
that Person to any other Person, including all Debt and accounts receivable
from that other Person that are not current assets and did not arise from
sales, leases, or rendition of services to that other Person in the ordinary
and usual course of business. The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment, less, in the case
of any loan or advance, any repayment of the principal thereof.
"Issuing Bank" shall mean ▇▇▇▇▇ Fargo or any other Bank
that, on behalf of all Banks, issues a Letter of Credit requested by Borrower
hereunder.
"Junior Payment Amount" means and refers to the sum of
(i) Fifty Million Dollars ($50,000,000), plus (ii) the Net Issuance Proceeds
of Qualified Offerings.
"KCC" means and refers to Kosmos Cement Company, a
Kentucky partnership.
"Keepwell Agreement" means and refers to, collectively,
that certain Keepwell Agreement dated December 29, 1983, between MMRI and the
Interlake Steamship Company, a Delaware corporation, and that certain letter
agreement, dated March 23, 1987, from MMRI addressed to the Secretary of
Transportation, in care of MARAD.
"Knoxville Plant" means and refers to that certain cement
plant of Borrower located at or near Knoxville, Tennessee, including (a) all
interests and estates of Borrower in real property on which such cement plant
is located, including improvements, buildings, and structures located
thereon, (b) all interests and estates of Borrower in real property related
to or used in connection with the operation of such cement plant, such as
related quarries, parking or storage areas, Related Terminals, or rights of
way, including improvements, buildings, and structures located thereon, and
(c) all tangible and intangible interests of Borrower in personal property
constituting part of or integral to the use or operation of such cement
plant, such as fixtures, machinery, equipment, licenses, permits, operating
and maintenance agreements, and related books and records (but excluding
accounts, inventory, and proceeds thereof).
"Lending Office" shall have the meaning ascribed thereto
in Section 2.18 hereof.
"Letters of Credit" means and refers to, depending on the
context, any or all of the Commercial Paper Letters of Credit, the Commercial
Letters of Credit, or the Standby Letters of Credit issued pursuant to the
terms of Sections 2.1(b) or 2.2 of this Agreement or those letters of credit
described on Schedule L-1 attached hereto.
"Letter of Credit Amount" means and refers to an amount
equal to Ninety-Five Million Dollars ($95,000,000).
"Letter of Credit Usage" means and refers to, as of any
date of determination, (a) the aggregate Stated Amount of the Letters of
Credit then outstanding, plus (b) the aggregate amount of all Unpaid
Drawings. For purposes of this definition, any amount that is denominated in
a currency other than Dollars shall be valued in Dollars based on the
applicable Exchange Rate for such currency as of the date of determination.
"Leverage Ratio" means and refers to, for the period to
be determined, the ratio of (a) the aggregate amount of Funded Debt as of the
last day of such period, provided, however, that in the event that the ABN-
AMRO Letter of Credit remains outstanding beyond January 31, 1996, Funded
Debt shall be deemed to include the Stated Amount from time to time
thereafter of such letter of credit, to (b) Consolidated EBITDA.
"LIBOR Business Day" means a Business Day on which
dealings in Dollar deposits are carried on in the London interbank market.
"LIBOR Rate" means for each Interest Period for each
LIBOR Rate Loan owed to a Bank the rate per annum (rounded upward, if
necessary, to the nearest whole 1/16 of 1%) determined by Agent pursuant to
the following formula:
Base LIBOR Rate
LIBOR Rate = --------------------------------------
100% - Reserve Percentage of such Bank
"LIBOR Rate Borrowing" means and refers to any Borrowing
designated by Borrower as a LIBOR Rate Borrowing pursuant to Sections 2.8 or
2.9 of this Agreement.
"LIBOR Rate Loan" means each portion of a Loan bearing
interest at a rate determined by reference to the LIBOR Rate.
"Lien" means and refers to any lien, mortgage, pledge,
security interest, charge, or encumbrance of any kind (including any
conditional sale or other title retention agreement or any lease in the
nature thereof) and any agreement to give or refrain from giving any lien,
mortgage, pledge, security interest, charge, or other encumbrance of any
kind.
"Loan" and "Loans" means and refers to the loans,
including drawings under Letters of Credit, to be made severally (not jointly
and not jointly and severally) by Banks to Borrower pursuant to Article 2 of
this Agreement.
"Loan Documents" shall mean the Real Property Collateral
D o cuments, the Agent's Fee Letter, the Personal Property Collateral
Documents, and all other written documents, agreements, or instruments,
including financing statements and fixture filings, other than this Agreement
and the Notes, that have been or are entered into by Borrower, Mojave, Agent,
or Banks, as the case may be, in connection with the transactions
contemplated by this Agreement.
"▇▇▇▇▇ Plant" means and refers to that certain cement
plant of Borrower located at or near Lyons, Colorado, including (a) all
interests and estates of Borrower in real property on which such cement plant
is located, including improvements, buildings, and structures located
thereon, (b) all interests and estates of Borrower in real property related
to or used in connection with the operation of such cement plant, such as
related quarries, parking or storage areas, Related Terminals, or rights of
way, including improvements, buildings, and structures located thereon, and
(c) all tangible and intangible interests of Borrower in personal property
constituting part of or integral to the use or operation of such cement
plant, such as fixtures, machinery, equipment, licenses, permits, operating
and maintenance agreements, and related books and records (but excluding
accounts, inventory, and proceeds thereof).
"Majority Banks" means and refers to, as of the date of
determination thereof, Banks having at least a majority of the aggregate
unpaid principal amount then outstanding of the Loans, or if no Loans are
outstanding at the date of determination, Banks having at least a majority of
the Revolving Credit Facility Commitment.
"MARAD" means and refers to the United States Department
of Transportation acting by and through the Maritime Administration.
"MARAD Reserve" means and refers to an amount equal to
the lesser of Twenty Million Dollars ($20,000,000) or the then outstanding
obligation of Borrower (as successor to MMRI) under the Keepwell Agreement,
that, so long as the Keepwell Agreement remains in effect, shall be reserved
under the Revolving Credit Facility Commitment and shall not be available for
borrowing or for any other purpose other than payment of obligations under
the Keepwell Agreement.
"Material Adverse Change" means and refers to a material
adverse change in the business, Assets, operations, business prospects, or
condition (financial or otherwise) of Borrower and its Subsidiaries, taken as
a whole, as compared with the business, Assets, operations, business
prospects, or condition (financial or otherwise) of Borrower and its
Subsidiaries, taken as a whole, as of December 31, 1994.
"Material Adverse Effect" means and refers to a material
adverse effect on the business, Assets, operations, business prospects, or
condition (financial or otherwise) of Borrower and its Subsidiaries, taken as
a whole.
" M aterial Subsidiaries" means and refers to those
Subsidiaries of Borrower owning assets valued at greater than One Hundred
Thousand Dollars ($100,000).
"Maturity Date" means and refers to October 30, 2000.
"MMRI" means and refers to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Resources,
Inc., a former Delaware corporation that was merged with and into Borrower,
with Borrower being the surviving entity in such merger.
"Mojave" means and refers to Mojave Northern Railroad
Company, a California corporation.
"Mojave Guaranty" means and refers to that certain Second
Amended and Restated Continuing Guaranty, executed by Mojave, guaranteeing
Debt of Borrower owing to Agent and the Banks, and any modifications or
amendments thereto, substantially in the form of Exhibit M-1 attached hereto.
"Mojave Security Agreement" means and refers to that
certain Second Amended and Restated Security Agreement, executed by Mojave,
as debtor, in favor of Agent, on behalf of Banks, as secured party, securing
t h e Mojave Guaranty, and any modifications or amendments thereto,
substantially in the form of Exhibit M-2 attached hereto.
"Moody's" means and refers to ▇▇▇▇▇'▇ Investors Service,
Inc.
"Multiemployer Plan" means and refers to a "multiemployer
plan" as defined in Section 4001(a)(3) of ERISA or a "multiemployer pension
plan" as defined in Section 3(37) of ERISA or Section 414 of the Code, or any
similar type of plan established and regulated under the laws of any
foreign country, that is maintained for employees of such Person or any
ERISA Affiliate of such Person.
"Net Issuance Proceeds" means and refers to, in respect
of any Qualified Offering, cash proceeds received by Borrower in connection
therewith, net of out-of-pocket costs and expenses paid or incurred in
connection therewith.
"1988 Credit Agreement" shall have the meaning ascribed
thereto in the recitals to this Agreement.
"1991 Credit Agreement" shall have the meaning ascribed
thereto in the recitals to this Agreement.
"1993 Credit Agreement" shall have the meaning ascribed
thereto in the recitals to this Agreement.
"Noncancellable Lease" means and refers to any lease of a
Person that is not cancellable without penalty at any time pursuant to the
terms thereof or any lease of a Person the cancellation of which, pursuant to
the terms thereof, would not be economical.
"Notes" means and refers to any one or more of the
promissory notes, dated as of the Closing Date, substantially in the form of
Exhibit N-1 attached hereto, issued by Borrower to the order of a Bank in a
face amount equal to such Bank's pro rata share of the Revolving Credit
Facility Commitment in effect on the Closing Date.
"Notice of Borrowing" means and refers to an irrevocable
notice from Borrower to Agent of Borrower's intention to borrow all or any
portion of the Loans (or request the issuance of all or any portion of the
L e t ters of Credit) that Borrower is entitled to borrow hereunder,
substantially in the form of Exhibit N-2 attached hereto, executed by a
Responsible Officer of Borrower and delivered to Agent pursuant to Section
2.8 hereof.
"Notice of Conversion/Continuation" means and refers to
an irrevocable notice from Borrower to Agent of Borrower's request to convert
all or any portion of such of the Loans bearing interest at one rate to that
of another rate or continue Loans at a particular rate of interest,
substantially in the form of Exhibit N-3 hereto, executed by a Responsible
Officer of Borrower and delivered to Agent pursuant to Section 2.9 hereof.
"Odessa Plant" means and refers to that certain cement
plant of Borrower located at or near Odessa, Texas, including (a) all
interests and estates of Borrower in real property on which such cement plant
is located, including improvements, buildings, and structures located
thereon, (b) all interests and estates of Borrower in real property related
to or used in connection with the operation of such cement plant, such as
related quarries, parking or storage areas, Related Terminals, or rights of
way, including improvements, buildings, and structures located thereon, and
(c) all tangible and intangible interests of Borrower in personal property
constituting part of or integral to the use or operation of such cement
plant, such as fixtures, machinery, equipment, licenses, permits, operating
and maintenance agreements, and related books and records (but excluding
accounts, inventory, and proceeds thereof).
"Officer's Compliance Certificate" means and refers to
that certificate of a Responsible Officer of Borrower described in Section
3.1(k) of this Agreement.
"Operating Lease" means and refers to, as applied to any
Person, any Noncancellable Lease of any Asset, that is not a Capitalized
Lease, other than any such lease under which that Person is the lessor.
"Overdue Rate" shall have the meaning set forth in
Section 2.6 hereof.
"PBGC" means and refers to the Pension Benefit Guaranty
Corporation as defined in Title IV of ERISA, or any successor thereto.
"Pension Plan" or "Plan" means and refers to any pension,
retirement, disability, health, welfare, life insurance or other employee
benefit plan, defined benefit, defined contribution, profit sharing, deferred
c o mpensation, stock option, employee stock ownership, employee stock
purchase, restricted stock, bonus or other incentive plan, vacation benefit,
fringe benefit, severance, thrift or other employee benefit plan or
arrangement, including any Pension Plan (other than any Multiemployer Plan)
or any plan similar to any of those plans described above that is established
or maintained under the law of any foreign country, irrespective of whether
any of the foregoing is funded, that was, is, or will be sponsored or
maintained by Borrower or its ERISA Affiliates (excluding any plans in which
personnel of Borrower or its ERISA Affiliates are not participating) in which
any personnel of Borrower or its ERISA Affiliates participate or from which
any such personnel may derive a benefit.
"Pension Protection Act" means and refers to the Pension
Protection Act, Pub. L. No. 101-508, Title IX, Subtitle D, Part II, 101 Stat.
1330 et seq. (1987), as amended by Pub. L. ▇▇. ▇▇▇-▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇.
▇▇▇▇ et seq. (1989), and any successor statute.
"Permitted Acquisitions" means and refers to Investments
or Asset Acquisitions that (a) are in an aggregate amount during the term of
this Agreement of not more than One Hundred Million Dollars ($100,000,000),
(b) are in Persons, or of Assets, that are engaged in, or useful in
connection with, businesses that are substantially the same as those
conducted by Borrower and its Subsidiaries on the Closing Date, (c) if the
consideration paid or payable for any such Investment or Asset Acquisition,
or series of related transactions, is in excess of Ten Million Dollars
($10,000,000), are Investments in or Asset Acquisitions by a Person that is a
corporation, a limited liability company, or a limited liability partnership,
(d) if the consideration paid or payable for any such Investment or Asset
Acquisition, or series of related transactions, is in excess of Fifty Million
Dollars ($50,000,000), result in (or continue) Borrower owning not less than
fifty percent (50%) of the Voting Stock (or membership interests or
partnership interests in the case of a limited liability company or limited
liability partnership) of the Person in which the Investment is made or the
Person that is to acquire the Assets and with respect to which Borrower also
has the right, whether by contract, vote, or otherwise, to exercise
substantial input in the management and control of the business of such
Person, (e) are not made utilizing Assets that compose the Collateral, and
(f) are not made utilizing Assets that compose the Brooksville Plant. For
purposes of the foregoing, a contribution of Dollars or Assets by Borrower to
a newly created Subsidiary of Borrower for the purpose of permitting such
Subsidiary to complete an Investment or Asset Acquisition shall not itself
constitute an Investment if such Dollars or Assets are, in fact, used to
complete the proposed Investment or Asset Acquisition.
"Permitted Junior Payments" means and refers to, so long
as at each time thereof, no Event of Default or Unmatured Event of Default
has occurred and is continuing and no such Event of Default or Unmatured
Event of Default would result therefrom, (a) the redemption, payment,
r e p u rchase, retirement for value, or acquisition, in one or more
transactions, in an aggregate amount (excluding any consideration paid in the
form of Borrower Common Stock) of up to the Junior Payment Amount of (i)
principal amount of the Senior Subordinated Notes, (ii) Preferred Stock,
(iii) Borrower Common Stock, or (iv) any combination of the foregoing;
provided, however, that the redemption, payment, or acquisition of Borrower
Common Stock shall constitute a Permitted Junior Payment only (y) if, after
g i ving effect to such proposed redemption, payment, or acquisition,
Borrower's Leverage Ratio (which will be calculated by utilizing the Funded
Debt extant as of the date of such redemption, payment, repurchase,
retirement for value, or acquisition after giving effect to the incurrence of
any Funded Debt incurred in connection with such transaction and by utilizing
the Consolidated EBITDA for the four (4) immediately preceding fiscal
quarters) would be less than or equal to 2.00:1.00, and (z) up to an
aggregate amount of Twenty Five Million Dollars ($25,000,000), (b) the
incurrence of the Exchange Subordinated Debt pursuant to Section 6.1(c), and
(c) the conversion of any Permitted Preferred Stock into, or the redemption
or acquisition of any Permitted Preferred Stock for, Borrower Common Stock
and payments of immaterial amounts in lieu of fractional shares in connection
with any such conversion or redemption; provided, however, that if no Event
of Default or Unmatured Event of Default had occurred and was continuing on
the date that Borrower gives notice of redemption or otherwise commences any
action preliminary to making a Permitted Junior Payment, Borrower shall be
entitled to make such Permitted Junior Payment notwithstanding the occurrence
or continuation of an Event of Default or Unmatured Event of Default (other
than an Event of Default or Unmatured Event of Default under Section 7.1(a)
hereof) as of the date such Permitted Junior Payment is to be made.
"Permitted Liens" shall mean and refer to:
(i) Liens for Taxes, assessments, or governmental charges or
claims the payment of which is not, at such time, required by
Section 5.4 of this Agreement;
(ii) statutory Liens of landlords, carriers, warehousemen,
mechanics, materialmen, and other Liens imposed by law and incurred in
the ordinary course of business for sums not yet delinquent or being
contested in good faith, if reserves or other appropriate provisions, if
any, as shall be required by GAAP shall have been made therefor;
(iii) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance, and other types of social
security, or to secure the performance of statutory obligations, surety
and appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds, and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(iv) any attachment or judgment Lien in existence less than
thirty (30) days after the date of entry thereof or with respect to
which execution has been stayed;
(v) leases or subleases granted to others not interfering
with the ordinary and usual course of business of Borrower or any of its
Subsidiaries;
(vi) easements, rights-of-way, mineral reservations,
restrictions, and other similar defects or irregularities of title not
interfering in any material respect with the ordinary and usual course
of business of Borrower or any of its Subsidiaries;
(vii) Liens granted by Borrower in favor of Agent, on behalf of
Banks, pursuant to the Personal Property Collateral Documents and the
Real Property Collateral Documents;
(viii) Liens granted by Mojave in favor of Agent, on behalf of
Banks, pursuant to the Personal Property Collateral Documents and the
Real Property Collateral Documents;
(ix) banker's liens in the nature of rights of setoff arising
in the ordinary and usual course of business of Borrower or any of its
Subsidiaries and the Lien granted in favor of The Bank of Nova Scotia in
the deposit account of Borrower maintained at The Bank of Nova Scotia,
such Lien being granted solely to secure Borrower's reimbursement
obligations respecting the letters of credit issued by The Bank of Nova
Scotia that are outstanding on the Closing Date;
(x) the Liens reflected in the Disclosure Statement securing
Debt extant on the Closing Date;
(xi) purchase money Liens granted by Borrower or any of its
Subsidiaries in Assets acquired in the ordinary course of business to
secure the payment of the purchase price of such Assets;
(xii) Liens, in the nature of agreements to refrain from giving
any lien, mortgage, pledge, security interest, charge, or other
encumbrance, with respect to Assets of Borrower and its Subsidiaries the
value of which is immaterial in relation to the value of all of the
Assets of Borrower and its Subsidiaries;
(xiii) Liens securing Acquired Indebtedness permitted to be
incurred under Section 6.1(k) if such Liens secured such Acquired
I n debtedness at the time such Acquired Indebtedness becomes an
obligation of Borrower or any of its Subsidiaries and such Liens were
not incurred in connection with, or in anticipation of, such Acquired
I n debtedness becoming an obligation of Borrower or one of its
Subsidiaries; provided, however, that such Liens shall not extend to or
cover any Assets of Borrower or any of its Subsidiaries other than the
Assets that secured the Acquired Indebtedness prior to such Acquired
I n debtedness becoming an obligation of Borrower or one of its
Subsidiaries;
(xiv) Liens securing up to Thirty Million Dollars ($30,000,000)
of the principal of the Indebtedness of Borrower and its Subsidiaries
incurred pursuant to Section 6.1(k) of this Agreement and interest
thereon, so long as such Liens do not attach or extend to the
Collateral, the Brooksville Plant, or the accounts or inventory of
Borrower or any of its Subsidiaries;
(xv) Liens securing refinancing Indebtedness to the extent any
such Lien replaces a Lien securing the Indebtedness so refinanced and is
limited to the Assets that were subject to the Lien securing the
Indebtedness so refinanced; and
(xvi) Liens not specified in clauses (i) through (xv) of this
definition and granted by Borrower or any of its Subsidiaries in the
ordinary and usual course of business of, and consistent with past
practices of, Borrower or any of its Subsidiaries (other than Liens
securing Debt permitted under clauses (b), (c), (d), (e), (j), (k), (l),
and (m) of Section 6.1) and Liens in the nature of deposits with a
trustee or other depository in connection with a redemption, payment,
acquisition, repurchase, retirement for value, or conversion that
constitutes a Permitted Junior Payment.
"Permitted Preferred Stock" means and refers to (a) the
Series A Preferred Stock, (b) the Series B Preferred Stock, (c) the Series C
Preferred Stock, (d) the Series D Preferred Stock, and (e) Preferred Stock
issued by Borrower (and not by one or more of its Subsidiaries) that is not
Prohibited Preferred Stock.
"Person" means and refers to natural persons,
c o rporations, limited partnerships, general partnerships, joint stock
companies, joint ventures, associations, companies, trusts, banks, trust
c o m p anies, land trusts, vehicle trusts, business trusts, or other
o r ganizations, irrespective of whether they are legal entities, and
governments and agencies and political subdivisions thereof.
"Personal Property Collateral Documents" means and refers
to the Stock Pledge, the Security Agreement, the Mojave Guaranty, the Mojave
Security Agreement, and any and all other documents, agreements, or
instruments to be executed or delivered in connection herewith or therewith.
"Pollution Control Bonds" means and refers to means and
refers to (a) those certain Floating Rate Monthly Demand Pollution Control
Revenue Bonds (Southdown, Inc. Project) Series 1983 issued by the California
Pollution Control Financing Authority pursuant to the Indenture of Trust
dated as of February 15, 1993, (b) those certain Floating Rate Monthly Demand
Industrial Development Revenue Bonds (Southdown, Inc. Project) Series 1983
issued by the California Pollution Control Financing Authority pursuant to
the Indenture of Trust dated as of April 1, 1983, (c) those certain Floating
Rate Monthly Demand Pollution Control Revenue Bonds (Southdown, Inc. Project)
Series 1983B issued by the California Pollution Control Financing Authority
pursuant to the Indenture of Trust dated as of September 1, 1983, (d) those
certain County of Jefferson, Kentucky, Pollution Control Revenue Bonds Series
1973 (The Flintkote Company Project) issued by the County of Jefferson,
Kentucky pursuant to the Indenture of Trust dated as of January 1, 1973, (e)
that certain Industrial Development Revenue Refunding Bond (▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Resources, Inc. Project) Series 1988 issued by the Industrial Development
Board of the County of ▇▇▇▇ pursuant to the Trust Indenture dated June 30,
1988, and (f) those certain Pollution Control Revenue Bonds (Florida Mining &
Materials Corp. Project), Series C issued by Hernando County, Florida
pursuant to the Trust Indenture dated May 20, 1981, as supplemented.
"Preferred Stock" means and refers to any class or series
of equity securities of Borrower or its Subsidiaries that is entitled, upon
any distribution of Assets of Borrower or its Subsidiaries, as the case may
be, whether by dividend or by liquidation, to a preference over another class
or series of equity securities of Borrower or its Subsidiaries, as
applicable.
"Prime Rate" means the rate of interest announced within
▇▇▇▇▇ Fargo at its principal office in San Francisco as its "prime rate",
with the understanding that the "prime rate" is one of ▇▇▇▇▇ Fargo's base
rates (not necessarily the lowest of such rates) and serves as the basis upon
which effective rates of interest are calculated for those loans making
reference thereto and is evidenced by the recording thereof after its
announcement in such internal publication or publications as ▇▇▇▇▇ Fargo may
designate.
"Prohibited Preferred Stock" means and refers to any
Preferred Stock that by its terms (a) is mandatorily redeemable on or before
October 30, 2002 or, on or before October 30, 2002, is redeemable at the
option of the holder thereof for cash (or Assets or securities other than
distributions in kind of preferred stock of the same class and series or of
Borrower Common Stock) of Borrower or any of its Subsidiaries; provided,
however, that Preferred Stock that is not otherwise Prohibited Preferred
Stock shall not be deemed to be Prohibited Preferred Stock by reason of this
clause (a) by virtue of the inclusion of a mandatory purchase or redemption
obligation that is triggered solely by a change of control so long as the
governing definition of change of control is not more restrictive than the
definition of `Change of Control' contained in this Agreement, or (b) is
convertible or exchangeable on or before October 30, 2002, mandatorily or at
the option of the holder thereof, into Debt of Borrower or any of its
Subsidiaries unless the Debt into which such Preferred Stock is convertible
or exchangeable does not provide for the scheduled repayment of any of the
principal thereof on or prior to October 30, 2002.
"Qualified Offerings" means and refers to all offerings
(whether one or more) by Borrower, on or after November 3, 1995, of equity
securities other than Prohibited Preferred Stock.
"Quarterly Payment Date" means and refers to the last day
of each December, March, June, and September so long as any portion of the
Loans are outstanding.
"RCRA" means and refers to the Resource Conservation and
Recovery Act of 1976, as amended, set forth at 42 U.S.C.Section
6901-6991i, including any rules or regulations issued in connection
therewith.
"Real Property Collateral Documents" means and refers to
t h ose mortgages, deeds of trust, fixture filings, or amendments or
modifications thereto, executed and delivered by Borrower in favor of Agent
for benefit of the Banks in order to encumber the fee and leasehold estates
and related fixtures that compose the Cement Plants (other than the
Brooksville Plant).
"Regulatory Change" shall have the meaning ascribed
thereto in Section 2.15 hereof.
"Related Terminals" means those certain terminals of
Borrower located at the locations specified in part R-1 of the Disclosure
Statement, including (a) all interests and estates of Borrower in real
property on which such terminals are located, including improvements,
buildings, and structures located thereon, (b) all interests and estates of
Borrower in real property related to or used in connection with the operation
of such terminals, such as related parking or storage areas, or rights of
way, including improvements, buildings, and structures located thereon, and
(c) all tangible and intangible interests of Borrower in personal property
constituting part of or integral to the use or operation of such terminals,
such as fixtures, machinery, equipment, licenses, permits, operating and
maintenance agreements, and related books and records (but excluding
accounts, inventory, and proceeds thereof).
"Remedial Action" means and refers to all response
actions set forth in 42 U.S.C.Section 9601(23), (24), and (25), whether
or not these activities are conducted under CERCLA.
" R eportable Event" means and refers to any event
described in Section Section 4043 (excluding subsections(b)(7) and (9)) of
ERISA.
"Reserve Percentage" means and refers to, as of the date
of determination thereof, for any Bank, the maximum percentage (rounded
upward, if necessary to the nearest one-hundredth (1/100th) of one percent
(1%)), as determined by such Bank in accordance with its usual procedures
(which determination shall be conclusive in the absence of manifest error),
that is in effect on such date as prescribed by the Federal Reserve Board for
determining the reserve requirements (including supplemental, marginal, and
e m ergency reserve requirements) with respect to eurocurrency funding
(currently referred to as "eurocurrency liabilities") of that Bank, but so
long as such Bank shall not be required or directed, under applicable
regulations of the Federal Reserve Board, to maintain such reserves, the
Reserve Percentage shall be zero.
"Responsible Officer" means and refers to the President,
Chief Executive Officer, Chief Financial Officer, Treasurer, Controller, or
Chief Operating Officer of Borrower, or such other officer of Borrower
designated by a Responsible Officer in a writing delivered to Agent.
"Revolving Credit Facility" means and refers to the
revolving loan and letter of credit facility set forth in Article 2 of this
Agreement.
"Revolving Credit Facility Commitment" means and refers
to, on the date of determination thereof, and subject to the effect of the
provisions of Section 2.12 hereof, the total amount of Banks' commitments to
extend credit to Borrower under the Revolving Credit Facility, which
commitment for any Bank shall be the amount set forth opposite the name of
such Bank under the appropriate heading on Schedule R-2 attached hereto, and
the total amount of which shall be the total of such amounts set forth on
such schedule. As of the Closing Date, the Revolving Credit Facility
Commitment is $200,000,000.
"Revolving Credit Facility LC Subfacility" means and
refers to the letter of credit facility that is a subfacility of the
Revolving Credit Facility and is set forth in Section 2.1(b) of this
Agreement.
"Revolving Credit Facility Loans" means and refers to the
Loans made to Borrower under the Revolving Credit Facility.
"Revolving Credit Facility Usage" shall mean, on the date
any determination thereof is to be made, the sum of, without duplication:
(a) the outstanding amount of the Revolving Credit Facility Loans; plus
(b) the Letter of Credit Usage; plus (c) the MARAD Reserve; plus (d) any
amounts reserved under Section 6.1(d).
"S&P" means and refers to Standard & Poor's Ratings
Group, a division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. on the date hereof, or any
successor.
"▇▇▇▇" means and refers to the Superfund Amendments and
Reauthorization Act of 1986, as amended from time to time, set forth in
Public Law 99-499 et seq., and all rules and regulations promulgated
thereunder.
"SEC" means and refers to the United States Securities
and Exchange Commission, and any successor thereto.
"Securities Act" means and refers to the Securities Act
of 1933, as amended from time to time, including any rules and regulations
promulgated in connection therewith and any successor statue.
"Security Agreement" means and refers to that certain
Amended and Restated Security Agreement, executed by Borrower, as debtor, in
favor of Agent, on behalf of Banks, as secured party, together with any
amendments or modifications thereto, substantially in the form of Exhibit S-1
attached hereto.
" S e n ior Subordinated Notes" means and refers to
Borrower's Series B 14% Senior Subordinated Notes, due 2001, issued under the
Subordinated Indenture of which One Hundred Twenty-Five Million Dollars
($125,000,000) were outstanding on the Closing Date.
"Series A Preferred Stock" means and refers to Borrower's
Preferred Stock, $.70 Cumulative Convertible Series A.
"Series B Preferred Stock" means and refers to Borrower's
Preferred Stock, $3.75 Convertible Exchangeable Series B.
"Series C Preferred Stock" means and refers to the
Preferred Stock, Cumulative Junior Participating Series C that is issuable by
Borrower on the terms and conditions, and entitled to the preferences,
limitations, and relative rights, set forth in Borrower's Restated Articles
of Incorporation, as amended.
"Series D Preferred Stock" means and refers to Borrower's
Preferred Stock, $2.875 Cumulative Convertible Series D.
" S p ecified Subsidiaries" means and refers to the
Subsidiaries of Borrower that are set forth on Schedule S-1 attached hereto.
"Standby Letter of Credit" means any standby letter of
credit issued hereunder for the purpose of supporting: (a) any letters of
credit or any obligations or liabilities supported on the Closing Date by
letters of credit to be replaced or supported by letters of credit issued
u n der this Agreement by an Issuing Bank; (b) worker's compensation
liabilities of Borrower or any of its Subsidiaries; (c) the obligations of
third party insurers of Borrower or any of its Subsidiaries; (d) performance,
p a yment, deposit, or surety obligations of Borrower or any of its
Subsidiaries; or (e) the Letters of Credit described on Schedule L-1 attached
hereto.
"Stated Amount" means and refers to the maximum amount
available to be drawn under each Letter of Credit, without regard to whether
any conditions to drawing could then be met.
"Stock Pledge" means and refers to that certain Amended
and Restated Security Agreement-Stock Pledge, executed by Borrower, as
d e btor, in favor of Agent, on behalf of Banks, as secured party,
hypothecating the capital stock of Mojave, together with any modifications or
amendments thereto, substantially in the form of Exhibit S-2 attached hereto.
"Subordinated Debt" means and refers to (a) the Existing
Subordinated Debt, and (b) the Exchange Subordinated Debt.
"Subordinated Indenture" means and refers to that certain
Indenture, dated as of October 15, 1991, entered into between Borrower and
State Street Bank and Trust Company of Connecticut, N.A., as trustee,
respecting the Senior Subordinated Notes, as amended as of December 10, 1993
and as further amended from time to time in conformity with the terms hereof.
"Subsidiary" means, with respect to any Person: (a) any
corporation in which such Person, directly or indirectly through its
Subsidiaries, owns more than fifty percent (50%) of the stock of any class or
classes having by the terms thereof the ordinary voting power to elect a
majority of the directors of such corporation; and (b) any partnership,
association, joint venture, or other entity in which such Person, directly or
indirectly through its Subsidiaries, has more than a fifty percent (50%)
equity interest at the time.
"Taxes" means and refers to any taxes, charges, fees,
levies or other assessments based upon or measured by net or gross income,
gross receipts, sales, use, ad valorem, transfer, franchise, withholding,
payroll, employment, excise, occupation, premium or property taxes, together
with any interest and penalties, additions to tax and additional amounts
imposed by any federal, state, local or foreign taxing authority upon any
Person.
" T ermination Event" means and refers to: (a) a
Reportable Event; (b) the withdrawal of Borrower or any of its ERISA
Affiliates from a Pension Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA; (c) the
filing of a notice of intent to terminate a Pension Plan or the treatment of
a Pension Plan amendment as a termination under Section 4041 of ERISA
excluding, for purposes of this clause (c), any standard termination under
Section 4041(b) of ERISA;d) the institution of proceedings to terminate a
Pension Plan by the PBGC; or(e)any other event or condition which would likely
constitute grounds under Sect.4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan.
"UCC" shall mean the California Uniform Commercial Code,
as amended or supplemented from time to time, and any successor statute.
"Unmatured Event of Default" means and refers to an
event, act, or occurrence that, with solely the giving of notice or the lapse
of time (or both), would become an Event of Default.
"Unpaid Drawings" means and refers to all drawings under
any Letter of Credit paid by the Issuing Bank with respect thereto, on behalf
of Banks, for which such Issuing Bank has not been reimbursed by Borrower or
funded by Loans pursuant to Section 2.1 hereof.
"Victorville Plant" means and refers to that certain
cement plant of Borrower located at or near Victorville, California,
including (a) all interests and estates of Borrower in real property on which
such cement plant is located, including improvements, buildings, and
structures located thereon, (b) all interests and estates of Borrower in real
property related to or used in connection with the operation of such cement
plant, such as related quarries, parking or storage areas, Related Terminals,
or rights of way, including improvements, buildings, and structures located
thereon, and (c) all tangible and intangible interests of Borrower in
personal property constituting part of or integral to the use or operation of
such cement plant, such as fixtures, machinery, equipment, licenses, permits,
operating and maintenance agreements, and related books and records (but
excluding accounts, inventory, and proceeds thereof).
"Voidable Transfer" has the meaning ascribed thereto in
Section 11.18.
"Voting Stock" means, with respect to any Person, Capital
Stock of any class or classes if the holders of such Capital Stock are
ordinarily, in the absence of contingencies, entitled to vote for the
election of the directors (or other persons performing similar functions) of
such Person even if the right to so vote has been suspended by the happening
of such a contingency.
"▇▇▇▇▇ Fargo" means and refers to ▇▇▇▇▇ Fargo Bank, N.A.,
a national banking association.
1.2 Construction. Unless the context of this Agreement
clearly requires otherwise, references to the plural include the singular and
to the singular include the plural, the part includes the whole, the terms
"include" and "including" are not limiting, and the term "or" has, except
where otherwise indicated, the inclusive meaning represented by the phrase
"and/or". References in this Agreement to a "determination" by Agent or
Majority Banks, as applicable, include good faith estimates by Agent or
Majority Banks, as applicable, in the case of quantitative determinations,
and good faith beliefs by Agent or Majority Banks, as applicable, in the case
of qualitative determinations. The words "hereof," "herein," "hereby,"
"hereunder," and similar terms in this Agreement refer to this Agreement as a
whole and not to any particular provision of this Agreement. Article,
section, subsection, exhibit, and schedule references are to this Agreement
unless otherwise specified. Any reference herein to this Agreement, the
Notes, or any of the Loan Documents includes any and all alterations,
amendments, changes, extensions, modifications, renewals, or supplements
thereto or thereof, as applicable. Any terms used herein that are not
accounting terms and that are not separately defined shall have the meanings
ascribed thereto in the UCC. Any reference to the provision by Borrower of
cash collateral to Agent, on behalf of Banks, to secure any obligations of
Borrower arising under this Agreement shall mean that Borrower shall have
entered into such documents as Agent shall have required, and shall have
taken such actions as may be required, in order for Agent, on behalf of
Banks, to possess a perfected, first priority security interest in such cash
collateral.
1.3 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP as in effect from
time to time, including applicable statements, bulletins, and interpretations
issued by the Financial Accounting Standards Board and bulletins, opinions,
interpretations, and statements issued by the American Institute of Certified
Public Accountants or its committees. When used herein, the term "financial
statements" shall include the notes and schedules thereto.
1.4 Disclosure Statement, Exhibits, Schedules. The
Disclosure Statement delivered by Borrower pursuant hereto and all of the
e x h ibits and schedules attached to this Agreement shall be deemed
incorporated herein by reference.
ARTICLE 2.
AMOUNT AND TERMS OF LOANS
2.1 Revolving Credit Facility.
(a) Revolving Credit Facility Loans. Subject to the
terms and conditions hereof, each Bank severally agrees to make Revolving
Credit Facility Loans to Borrower, pro rata in proportion of its share of the
Revolving Credit Facility Commitment, from the Closing Date to but not
including the Maturity Date, at such times and in such amounts as Borrower
may request in accordance with Section 2.8 hereof, which amounts may be
borrowed, repaid without penalty or premium, and reborrowed subject to the
limitations set forth herein; provided, however, that: (i) the aggregate
principal amount at any time outstanding of all Revolving Credit Facility
Loans made by any Bank shall not exceed such Bank's pro rata share of the
Revolving Credit Facility Commitment then in effect; and (ii) the aggregate
principal amount of any Borrowing under the Revolving Credit Facility shall
not exceed the positive difference between: (x) the Revolving Credit
Facility Commitment then in effect; minus (y) the amount of the Revolving
Credit Facility Usage immediately prior to such Borrowing. Subject to the
foregoing: (i) each Base Rate Borrowing shall be in a minimum principal
amount of One Million Dollars ($1,000,000) or such lesser amount as is the
then unfunded balance of the Revolving Credit Facility Commitment and,
thereafter, in integral multiples of One Hundred Thousand Dollars ($100,000);
and (ii) each LIBOR Rate Borrowing shall be in a minimum principal amount of
Five Million Dollars ($5,000,000) and, thereafter, in integral multiples of
One Million Dollars ($1,000,000). No Bank shall have any obligation to make
Revolving Credit Facility Loans on or after the Maturity Date.
(b) Revolving Credit Facility Letters of Credit. As
part of Revolving Credit Facility and subject to the terms and conditions
hereof, Borrower may request, in accordance with Section 2.2 hereof, that an
Issuing Bank issue Letters of Credit for the account of Borrower, and,
subject to the terms and conditions hereof, the Banks agree that an Issuing
Bank will issue such Letters of Credit. On the Closing Date, any and all
Letters of Credit set forth on Schedule L-1 shall be deemed issued under this
Section 2.1(b). The foregoing notwithstanding, (a) no Issuing Bank shall
issue any Commercial Paper Letter of Credit under the Revolving Credit
Facility if, after giving effect to such issuance, the Commercial Paper
Letter of Credit Usage would exceed the Commercial Paper Letter of Credit
Amount, (b) no Issuing Bank shall issue any Letter of Credit if, after giving
effect to such issuance, the Letter of Credit Usage would exceed the Letter
of Credit Amount, and (c) no Issuing Bank shall issue any Letter of Credit
if, after giving effect to such issuance, the Revolving Credit Facility Usage
would exceed the Revolving Credit Facility Commitment then in effect.
(c) MARAD. Subject to the terms and conditions hereof
and so long as a Borrowing under Revolving Credit Facility is otherwise
permitted, in the event MARAD has made a demand provided for, and in
accordance with paragraph 5 of the Keepwell Agreement, and Borrower has
failed to comply therewith, each Bank severally agrees to make advances under
the Revolving Credit Facility to MARAD (for the benefit of Borrower), pro
rata in proportion of such Bank's share of the Revolving Credit Facility
Commitment, from the Closing Date to but not including the Maturity Date, in
such amounts that in the aggregate shall not exceed the lesser of (i)
Borrower's obligation that is then due and payable to MARAD under the
Keepwell Agreement, (ii) the amount of the MARAD Reserve at such time, and
(iii) the amount of Revolving Credit Facility Loans that are available to be
borrowed under this Agreement, but only upon receipt by Agent of a written
request from the United States Secretary of Transportation (the "Secretary")
for such an advance and after ten (10) Domestic Business Days prior notice by
the Secretary to Borrower of such a request. Any such advances requested by
MARAD shall be advanced to such account of MARAD as requested by the
Secretary and shall be deemed to be Revolving Credit Facility Loans and Base
Rate Loans. Borrower authorizes the making of such advances on its behalf
and acknowledges that it will be obligated to repay any such advances to
MARAD as if the same directly had been requested by Borrower. The amount of
the MARAD Reserve shall be reduced immediately by the amount of any such
Borrowing.
2.2 Letters of Credit.
(a) Immediately upon the issuance of each Letter of
Credit hereunder, each Bank shall be deemed to and hereby agrees to have
irrevocably purchased from the Issuing Bank a participation in such Letter of
Credit and any drawing thereunder in an amount equal to such Bank's pro rata
share of the Revolving Credit Facility Commitment to the same extent and with
the same effect as if such Bank had issued such Letter of Credit.
Accordingly, each Bank shall, pursuant to the provisions of Section 2.10(b)
hereof, remit to Agent, in immediately available funds, an amount that is in
the same proportion to the amount drawn under the Letter of Credit as such
Bank's share of the Revolving Credit Facility Commitment, plus interest on
such amount, at the rate set forth in Section 2.10(b) hereof, payable from
the date of such drawing to the date such Bank initiates payment of such
amount to Agent. Borrower and Banks hereby agree that amounts paid by or on
behalf of Banks under and pursuant to each Letter of Credit shall constitute
Base Rate Loans made under Section 2.1(a). Each Bank's obligation to make
the Base Rate Loans referred to in this Section 2.2 shall continue despite
the occurrence of any Event of Default or Unmatured Event of Default or any
inability of Borrower to require that such Bank fund its pro rata share of
the Revolving Credit Facility Commitment, including any inability resulting
from the operation of Sect.365(c)(2)of the federal Bankruptcy Code or
otherwise. Borrower acknowledges and agrees that, anything herein to the
contrary notwithstanding, in the event of a bankruptcy of Borrower, should
Banks be precluded or restricted from making Loans to Borrower secured by the
Collateral and entitled to all the benefits and protections of the Loan
Documents, then, in the event of any draw under any Letter of Credit, the
reimbursement claim of the Issuing Bank against Borrower for the amount paid
by the Issuing Bank with respect to such draw shall be treated in all
respects as if it were a Loan made by the Issuing Bank on the date that the
Issuing Bank honored such draw (including for purposes of accruing interest),
and, upon paying to the Issuing Bank such Bank's share of the amount paid by
the Issuing Bank in connection with such draw, each Bank shall hold a
corresponding participation interest in the Issuing Bank's reimbursement
claim against Borrower.
(b) Borrower shall pay a letter of credit fee to
Agent for the account of the Banks, in an amount equal to (i) in the case of
Commercial Letters of Credit, the then extant Applicable Commercial Letter of
Credit Margin times the Stated Amount of each requested Commercial Letter of
Credit, such letter of credit fee to be payable in advance at the time of the
issuance of each such Commercial Letter of Credit, and (ii) in the case of
Commercial Paper Letters of Credit and Standby Letters of Credit, the then
extant Applicable LIBOR Rate Margin, on a per annum basis, times the Stated
Amount of each requested Commercial Paper Letter of Credit or Standby Letter
of Credit, such letter of credit fee to be payable quarterly in arrears on
each Quarterly Payment Date.
(c) Each Letter of Credit is to be issued only upon
satisfaction of the following conditions:
(i) Borrower shall be entitled under Section 2.1 to a
Borrowing in an amount equal to or greater than the face amount of the
Letter of Credit on the date of the issuance thereof;
(ii) all conditions to Loans specified in Sections 3.1 and 3.2
hereof, with respect to Letters of Credit to be issued on the Closing
Date, and in Section 3.3, with respect to all Letters of Credit, shall
have been satisfied on the date of the issuance of each Letter of
Credit; and
(iii) Borrower shall have submitted an application and
executed such other documents, instruments, and agreements as may be
required by the Issuing Bank, all in form and substance reasonably
satisfactory to such Issuing Bank.
(d) Each Letter of Credit shall be administered by the
Issuing Bank on behalf of all Banks. The letter of credit fees payable by
Borrower for the issuance of Letters of Credit shall be allocated by Agent to
Banks as follows:
(1) Commercial Letters of Credit.
(y) to the Issuing Bank, an administrative fee equal
to .10 percentage points times the Stated Amount of
the Commercial Letter of Credit, such fee to be
payable at the time of issuance; and
(z) to all Banks (including the Issuing Bank), the
balance of the letter of credit fee payable with
respect to such Commercial Letter of Credit, pro
rata, based upon each Bank's proportionate share of
the Revolving Credit Facility Commitment, such fee
to be payable at the time of issuance.
(2) Standby Letters of Credit and Commercial Paper
Letters of Credit.
(y) to the Issuing Bank, an administrative fee equal
to .125 percentage points, per annum, times the
Stated Amount of the Standby Letter of Credit or
Commercial Paper Letter of Credit, such fee to be
payable in arrears on each Quarterly Payment Date;
and
(z) to all Banks (including the Issuing Bank), the
balance of the letter of credit fee payable with
r e spect to such Standby Letter of Credit or
Commercial Paper Letter of Credit, pro rata, based
u p o n each Bank's proportionate share of the
Revolving Credit Facility Commitment, such fee to be
payable in arrears, on each Quarterly Payment Date.
(e) If, for any reason, a Bank fails to pay its
liability on a Letter of Credit in accordance with the provisions of this
Section 2.2, then the Issuing Bank automatically shall be subrogated to the
right of such defaulting Bank to repayment, in full, of the Base Rate Loan
created by virtue of a drawing on a Letter of Credit prior to distribution of
any repayments to the defaulting Bank.
(f) Each Commercial Letter of Credit shall be issued for
a term not to exceed one hundred eighty (180) days, each Commercial Paper
Letter of Credit shall be issued for a term not to exceed one (1) year, and
each Standby Letter of Credit shall be issued for a term not to exceed one
(1) year, in each case as designated by Borrower when requesting such Letter
of Credit.
(g) Letters of Credit issued pursuant to this Section
2.2 shall have an expiration date not later than the Maturity Date.
(h) SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR
DOCUMENTARY CREDITS, IN DETERMINING WHETHER TO PAY UNDER ANY LETTER OF
CREDIT, THE ISSUING BANK SHALL BE RESPONSIBLE ONLY TO DETERMINE THAT THE
DOCUMENTS AND CERTIFICATES REQUIRED TO BE DELIVERED UNDER THAT LETTER OF
CREDIT HAVE BEEN DELIVERED AND THAT THEY COMPLY ON THEIR FACE WITH THE
REQUIREMENTS OF THAT LETTER OF CREDIT.
2.3 Authorization and Issuance of Notes. Borrower has authorized
the issuance of Notes in the aggregate principal amount of Two Hundred
Million Dollars ($200,000,000). On the Closing Date, Borrower shall issue a
Note, payable to the order of each Bank, substantially in the form of Exhibit
N-1, with appropriate insertions. Each such Note shall be in an amount equal
to such Bank's pro rata share of the Revolving Credit Facility Commitment in
effect on the Closing Date.
Borrower shall deliver each such Note to Agent for delivery to
the appropriate Bank. The Notes delivered to the Banks shall evidence the
aggregate outstanding principal balance of the Revolving Credit Facility
Loans made, from time to time, to Borrower and the obligation of Borrower to
repay the amount of any drawings made under Letters of Credit, together with
interest accrued and unpaid thereon.
Anything herein to the contrary notwithstanding, it is the
express intent of the parties hereto to preserve the outstanding nature of
all loans and letters of credit made or issued under the 1993 Credit
Agreement and outstanding on the Closing Date immediately prior to the
closing of the transactions contemplated hereby. To that end, as more
specifically delineated in Section 3.2, all such outstanding loans and
letters of credit shall be converted on the Closing Date to Loans and Letters
of Credit hereunder as set forth in such Section 3.2, and shall not be deemed
to have been repaid or cancelled and reloaned or reissued, but rather, at all
times, continuously to have remained outstanding. To the extent that the
shares of Banks hereunder differ from the shares of the "Banks" under the
1993 Credit Agreement, the claims of such old "Banks" that are being
replaced, or whose shares are being reduced, shall be considered to have been
assigned, without representation, warranty, or recourse by such old "Banks"
to the Banks hereunder in such a manner as to achieve ratable outstandings
hereunder immediately following the closing, and Agent and the Banks shall
cooperate to effect such adjustments and transfers at closing among the Banks
as may be necessary or appropriate to achieve such ratable outstandings
immediately after such closing.
2.4 Rate Designation. Borrower shall designate each Borrowing
requested by it as a Base Rate Borrowing or a LIBOR Rate Borrowing in the
Notice of Borrowing given to Agent in accordance with Section 2.8 hereof.
2.5 Interest Rates; Payment of Principal and Interest.
(a) (i) The obligation of Borrower to repay all of the Loans
made under Revolving Credit Facility shall be evidenced by the Notes.
(ii) All of the Notes shall be payable to the order of
each Bank at Agent's San Francisco main branch located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other office of Agent as
may be designated, from time to time, by Agent, for the account of each Bank,
not later than 9:00 a.m., California time, on the date of payment. Upon
receipt by Agent of such payments as are made in compliance with the terms of
this Section 2.5(a), payments made by Borrower shall be deemed made to each
Bank and shall constitute satisfaction of Borrower's obligations to each Bank
with respect to the Loans so repaid. Agent shall, on either the Domestic
Business Day that is the day upon which Agent receives a payment from
Borrower if Agent shall have received such payment from Borrower by
9:00 a.m., California time, on that day, or on the next Domestic Business Day
following the Domestic Business Day on which Agent receives a payment from
Borrower if such payment is received after 9:00 a.m., California time,
initiate payment to each Bank of its pro rata share of the Loans repaid. If
Agent shall initiate such payment to a Bank later than the date set forth in
the immediately preceding sentence, then Agent shall pay to such Bank, in
addition to its pro rata share of the Loans repaid, interest on such amount
at the customary rate set by Agent for the correction of errors among banks
for the first three (3) Domestic Business Days and, thereafter, at the Base
Rate.
(b) Each Base Rate Loan shall bear interest, upon the unpaid
principal balance thereof from the date advanced or converted, at a
fluctuating rate, per annum, equal to the Base Rate plus the Applicable Base
Rate Margin. Interest due on the Base Rate Loans shall be due and payable,
in arrears, commencing on the first Quarterly Payment Date following the
Closing Date, and continuing thereafter on each Quarterly Payment Date up to
and including the Quarterly Payment Date immediately preceding the Maturity
Date, and on the Maturity Date.
(c) Each LIBOR Rate Loan owed to a Bank shall bear interest,
upon the unpaid principal balance thereof, from the date advanced or
converted, at a rate, per annum, equal to the LIBOR Rate for such Bank plus
the Applicable LIBOR Rate Margin. Interest due on the LIBOR Rate Loans shall
be due and payable, in arrears, on each Interest Payment Date applicable to
that LIBOR Rate Loan. Anything to the contrary contained in this Agreement
notwithstanding, Borrower shall not have more than six (6) LIBOR Rate
Borrowings outstanding at any one time.
(d) The aggregate principal amount of all Revolving Credit
Facility Loans outstanding as of the Maturity Date shall be due and payable
on the Maturity Date.
(e) Anything to the contrary contained in this Agreement
notwithstanding, Borrower shall not be obligated to pay, and Banks shall not
b e entitled to charge, collect, receive, reserve, or take interest
("interest" being defined as the aggregate of all charges that constitute
interest under applicable law that are contracted for, charged, reserved,
received, or paid) in excess of the maximum rate allowed by applicable law.
During any period of time in which the interest rate specified herein exceeds
such maximum rate, interest shall accrue and be payable at such maximum rate;
provided, however, that, if the interest rate declines below such maximum
rate, interest shall continue to accrue and be payable at such maximum rate
(so long as there remains any unpaid principal with respect to the Loans)
until the interest that has been paid hereunder and under the Notes equals
the amount of interest that would have been paid if interest had at all times
accrued and been payable at the interest rate specified in this Section 2.5
without being limited to the maximum rate specified in this Section 2.5.
For purposes of this Section 2.5(e), the term "applicable
law" shall mean that law in effect from time to time and applicable to the
loan transaction between Borrower and Banks that lawfully permits the
charging and collection of the highest permissible, lawful non-usurious rate
of interest on such loan transaction and this Agreement, including laws of
the State of California and, to the extent controlling, laws of the United
States of America. It is intended that, in the event that, notwithstanding
the parties' express choice of other law to be applicable to this Agreement,
the laws of the State of Texas are included in determining applicable law,
Chapter One ("Chapter One") of Title 79, Revised Civil Statutes of Texas,
1925, as amended (the "Texas Credit Code"), shall be included in any such
determination, and that, for the purpose of applying Chapter One to this
Agreement, the maximum interest rate shall be the "indicated rate ceiling"
(as such term is used in Article 5069-1.04 of Chapter One) from time to time
in effect. Any Bank may, from time to time, as to current and future
balances, implement any other ceiling under Chapter One by notice to
Borrower, if and to the extent permitted by Chapter One. The parties hereto
expressly agree, pursuant to Article 5069-15.10(b) of Chapter Fifteen
("Chapter Fifteen") of the Texas Credit Code, that Chapter Fifteen shall not
apply to this Agreement or to any Loan and that neither this Agreement nor
any Loan shall be governed by or subject to the provisions of Chapter Fifteen
in any manner whatsoever.
(f) In the event that, as a result of the operation of any
provision of this Agreement, Borrower repays a LIBOR Rate Loan prior to the
expiration of the Interest Period applicable thereto, Borrower shall,
concurrently with the repayment of any such Loan, pay any and all accrued and
unpaid interest on the amount repaid.
2.6 Overdue Rates. Any payment of principal or (to the extent
permitted by law and both before and after judgment) interest with respect to
the Loans, or any fees, expenses, or other amounts not paid when due
hereunder or declared due, whether at maturity, by acceleration, by lapse of
time, or otherwise, shall thereafter bear interest, without affecting any of
the other rights and remedies provided for herein or in the Notes, at a rate
(the "Overdue Rate") equal to the lesser of: (a) (i) for all amounts not
paid when due other than LIBOR Rate Loans, at the Base Rate plus the
Applicable Base Rate Margin plus two (2) percentage points; and (ii) as to
all LIBOR Rate Loans not paid when due, at the LIBOR Rate plus the Applicable
LIBOR Rate Margin plus two (2) percentage points; and (b) the Highest Lawful
Rate.
2.7 Computation of Interest and Fees. All computations of the
Commitment Fee, computations of the letter of credit fees with respect to
Letters of Credit, and computations of interest with respect to Base Rate
Loans for any period shall be calculated on the basis of a year of three
h u ndred sixty-five (365) or three hundred sixty-six (366) days, as
applicable, for the actual number of days elapsed in such period. All
c o mputations of interest with respect to LIBOR Rate Loans and all
computations of interest due under Section 2.6 hereof, for any period shall,
to the fullest extent permitted by law, be calculated on the basis of a year
of three hundred sixty (360) days for the actual number of days elapsed in
such period. Interest shall accrue from the first day of the making of a
Loan to the date of repayment of such Loan in accordance with the provisions
hereof; provided, however, that, if a Loan is repaid on the same day on which
it is made, then one (1) day's interest shall be paid on that Loan.
2.8 Notice of Borrowing Requirements.
(a) Each Base Rate Borrowing shall be made on a Domestic Business
Day and each LIBOR Rate Borrowing shall be made on a LIBOR Business Day.
(b) Each Borrowing (except a Borrowing pursuant to Section 2.1(c)
which shall be made upon the written notice provided for therein but shall be
subject to the timing requirement set forth in clause (i) and subsection (c)
below) or Letter of Credit issuance shall be made upon written notice, by way
of a Notice of Borrowing, in the form of Exhibit N-2, given by telex,
telecopy, mail, or personal service, delivered to Agent at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as follows:
(i) For a Base Rate Borrowing, Agent shall be given notice on
the day on which such Borrowing is to be made and such notice shall specify
that a Base Rate Borrowing is requested and shall state the amount thereof
(subject to the provisions of this Article 2);
(ii) For a LIBOR Rate Borrowing, Agent shall be given notice
at least three (3) LIBOR Business Days prior to the day on which such
Borrowing is to be made and such notice shall specify that a LIBOR Rate
Borrowing is requested and shall state the amount and proposed Interest
Period thereof (subject to the provisions of this Article 2);
(iii) For the issuance of a Letter of Credit, Agent and the
Issuing Bank shall be given notice at least four (4) Domestic Business Days
prior to the day on which such Letter of Credit is to be issued, or such
shorter period of time as is acceptable to the Issuing Bank; provided,
however, that any such notice period shall be sufficiently long as is
necessary to satisfy the conditions set forth in Section 2.2, as applicable,
with respect to such issuance. Such notice shall specify that a Letter of
Credit issuance is requested and shall state the amount thereof (subject to
the provisions of this Article 2).
(c) If the notice required by clause (b) of this Section 2.8 shall
have been received by Agent no later than 9:00 a.m., California time, on a
Domestic Business Day or LIBOR Business Day, as applicable, such day shall be
treated as the first Domestic Business Day or LIBOR Business Day, as
applicable, of the required notice period. In any other event, such notice
shall be treated as having been received immediately before 9:00 a.m.,
California time, of the next Domestic Business Day or LIBOR Business Day, as
applicable.
(d) In lieu of delivering the above-described Notice of Borrowing,
Borrower, by one of its Responsible Officers or any other individual
authorized to act on its behalf, may give Agent telephonic notice requesting
a Borrowing to be disbursed pursuant to the terms of Section 2.21 hereof by
the required time of any proposed Borrowing under this Section 2.8; provided,
however, that such notice shall be confirmed in writing by delivery of a
Notice of Borrowing to Agent on or before the proposed date of such
Borrowing. Agent and Banks shall incur no liability to Borrower and Agent
shall incur no liability to Banks in acting upon any telephonic notice
referred to above which Agent believes in good faith to have been given by a
Responsible Officer or other individual authorized to act on behalf of
Borrower or for otherwise acting in good faith under this Section 2.8 and in
making any Loans in accordance with this Agreement pursuant to any telephonic
notice. Any Notice of Borrowing (or telephonic notice in lieu thereof) shall
be irrevocable and Borrower shall be bound to make a Borrowing in accordance
therewith.
2.9 Conversion or Continuation.
(a) Subject to the provisions of Section 2.16, Borrower shall
have the option to: (a) convert all or any part of its outstanding Loans
equal to One Million Dollars ($1,000,000) and integral multiples of One
Hundred Thousand Dollars ($100,000) in excess of such amount, to a Base Rate
Loan; (b) convert all or any portion of its outstanding Loans equal to Five
Million Dollars ($5,000,000), and integral multiples of One Million Dollars
($1,000,000) in excess of such amount, to a LIBOR Rate Loan; or (c) upon the
expiration of any Interest Period applicable to a LIBOR Rate Loan, to
continue all of such LIBOR Rate Loan as a LIBOR Rate Loan and the succeeding
Interest Period of such continued Loan shall commence on the expiration date
of the Interest Period previously applicable thereto; provided, however ,
that a LIBOR Rate Loan only may be converted into a Base Rate Loan or
continued, as the case may be, on the expiration date of the Interest Period
applicable thereto; provided further, however, that no outstanding Loan may
be continued as, or be converted into, a LIBOR Rate Loan when any Event of
Default has occurred and is continuing; provided further, however, that if
Borrower fails to deliver the appropriate Notice of Conversion/Continuation
or the telephonic notice in respect thereof before the expiration of the
Interest Period of a LIBOR Rate Loan, such LIBOR Rate Loan automatically
shall be converted to a Base Rate Loan.
(b) Any provisions of the foregoing paragraph of this Section
2.9 to the contrary notwithstanding, Borrower may convert a LIBOR Rate Loan
into a Base Rate Loan prior to the expiration date of the Interest Period
applicable thereto upon payment to each Bank, pursuant to the provisions of
Section 2.15 hereof, of all costs, expenses and losses incurred by any Bank
as a result of the timing of such conversion.
(c) B o r r o w e r shall deliver a Notice of
Conversion/Continuation, in the form of Exhibit N-3, with respect to a
conversion or continuation of one of its Loans to Agent no later than
9:00 a.m., California time, on the Domestic Business Day that is the proposed
conversion date in the case of a conversion to a Base Rate Loan and at least
t h r ee (3) LIBOR Business Days in advance of the proposed
c o nversion/continuation date in the case of a conversion to, or a
continuation of, a LIBOR Rate Loan. A Notice of Conversion/Continuation
shall specify: (i) the proposed conversion/continuation date (which shall be
a Domestic Business Day or a LIBOR Business Day, as applicable); (ii) the
amount of the Loan to be converted/continued; (iii) the nature of the
proposed conversion/continuation; and (iv) in the case of a conversion to, or
continuation of, a LIBOR Rate Loan, the requested Interest Period.
(d) In lieu of delivering the above-described Notice of
Conversion/Continuation, Borrower, by any of its Responsible Officers or any
other individual authorized to act on behalf of Borrower, may give Agent
t e l e p h o nic notice by the required time of any proposed
conversion/continuation under this Section 2.9; provided, however, that such
notice shall be promptly confirmed in writing by delivery of a Notice of
C o n v e rsion/Continuation to Agent on or before the proposed
conversion/continuation date. Agent and Banks shall incur no liability to
Borrower in acting upon any such telephonic notice that Agent believes in
good faith to have been given by a Responsible Officer or other individual
authorized to act on behalf of Borrower, or for otherwise acting in good
faith under this Section 2.9 and in converting/continuing pursuant to any
telephonic notice. Any Notice of Conversion/Continuation (or telephonic
notice in lieu thereof) shall be irrevocable and Borrower shall be obligated
to convert or continue in accordance therewith.
2.10 Loans by Banks.
(a) Agent promptly shall notify each Bank of that Bank's pro
rata portion of a Borrowing or Letter of Credit issuance requested pursuant
to Section 2.8 hereof. Not later than 10:00 a.m., California time, on the
date specified in such notice as the date on which the Borrowing so requested
is to be made, each Bank, subject to the terms and conditions hereof, shall
initiate a transfer of funds to make its pro rata portion of the Borrowing
available in immediately available funds, to Agent at its San Francisco main
branch located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
(b) An Issuing Bank promptly shall notify each Bank of that
Bank's pro rata portion of a drawing made under a Letter of Credit. Not
later than 9:00 a.m., California time, on the date specified in such notice
as the date on which such drawing is to be paid, each Bank, subject to the
terms and conditions hereof, shall initiate a transfer of funds to make its
pro rata portion of such drawing available, in immediately available funds,
to Agent. In the event that Issuing Bank is unable to notify Banks in time
sufficient to permit Banks to timely remit their portion of the drawing to
Issuing Bank, then each Bank shall be required to initiate a transfer of
funds to make payment to Agent of its pro rata portion of the drawing under
the Letter of Credit, together with interest thereon accrued from the date of
the drawing to the date on which such Bank initiates payment to Agent at the
rate set forth in the following sentence, by no later than 9:00 a.m.
California time, on the Domestic Business Day immediately following the date
of receipt of the notice from Issuing Bank. In the event that any Bank fails
to make any payment to Agent, as specified above, Issuing Bank shall be
entitled to recover such amount on demand from such Bank together with
interest thereon until paid at the customary rate set by such Bank for the
correction of errors among banks for the first three (3) Domestic Business
Days and, thereafter, at the Base Rate.
(c) Each Bank's obligation to make any Loan pursuant hereto
is several, and not joint or joint and several, and is not conditioned upon
the performance by each, any, or all of the other Banks of their obligations
to make Loans. The failure by any Bank to perform its obligation to make
Loans will neither increase any other Bank's pro rata portion of the
Revolving Credit Facility Commitment nor relieve any other Bank of its
obligation to make Loans pursuant to its share of the Revolving Credit
Facility Commitment. Agent shall notify Banks of the failure by any Bank (a
"Defaulting Bank") to perform its obligation to make a Loan required to be
made by such Defaulting Bank hereunder and any Bank (other than such
Defaulting Bank) may, if it desires, assume, in such proportion as the
Majority Banks (calculated without inclusion of the Defaulting Bank) may
agree, the obligation of the Defaulting Bank or Banks to make Loans, but no
Bank shall be obligated to do so.
2.11 Mandatory Repayment.
(a) Subject to the provisions of Section 2.12, the Revolving
Credit Facility Commitment shall terminate on the Maturity Date.
(b) In the event that, at any time, the Revolving Credit
Facility Usage exceeds the then extant amount of the Revolving Credit
Facility Commitment, then, and in each such event, Borrower immediately shall
repay the amount of such excess to Agent to be distributed to Banks based
upon their pro rata share of the Revolving Credit Facility Commitment.
2.12 Voluntary Prepayments or Reductions of Revolving Credit
Facility Commitment.
(a) Subject to Section 2.15 hereof, Borrower shall have the
right, at any time and from time to time, to prepay the Loans without penalty
or premium. Borrower shall give Agent notice of any such prepayment with
respect to Base Rate Loans on the date of prepayment and not less than three
(3) LIBOR Business Days prior written notice of any such prepayment with
respect to LIBOR Rate Loans. In each case, such notice shall specify the
date on which such prepayment is to be made (which shall be a Domestic
Business Day or LIBOR Business Day, as applicable), and the amount of such
prepayment. Each such prepayment on account of Base Rate Loans shall be in
an aggregate minimum amount of One Million Dollars ($1,000,000), and integral
multiples of One Hundred Thousand Dollars ($100,000) in excess of such amount
and shall include interest accrued on the amount prepaid to the date of
payment. Each such prepayment on account of LIBOR Rate Loans shall be in an
aggregate minimum amount of Five Million Dollars ($5,000,000), and integral
multiples of One Million Dollars ($1,000,000) in excess of such amount and
shall include interest accrued on the amount prepaid to the date of payment.
(b) Borrower shall have the right at any time and from time
to time to permanently reduce, in whole or in part, the unfunded portion of
the Revolving Credit Facility Commitment. Borrower shall give Agent not less
than five (5) Domestic Business Days prior written notice designating the
date (which shall be a Domestic Business Day) of such reduction and the
amount of such reduction. Each such reduction shall be effective on the date
specified in Borrower's notice given in compliance hereunder. Each such
reduction shall be in an aggregate minimum amount of Five Million Dollars
($5,000,000), and integral multiples of One Million Dollars ($1,000,000) in
excess thereof, or, if less, the balance of the Revolving Credit Facility
Commitment. Each such reduction shall not reduce any LIBOR Rate Borrowing to
an amount that is less than Five Million Dollars ($5,000,000) but greater
than zero.
(c) Any reduction of the Revolving Credit Facility Commitment
pursuant to this Section 2.12 shall be without premium or penalty (other than
under Section 2.15 hereof and other than payment of any Commitment Fees
accrued under Section 2.13 hereof).
(d) Any reduction of the Revolving Credit Facility Commitment
pursuant to this Section 2.12 shall reduce each Bank's pro rata share of the
Revolving Credit Facility Commitment.
2.13 Commitment Fee. Borrower shall pay a fee (the "Commitment
Fee") to Agent, to be distributed by Agent to each Bank based upon such
Bank's pro rata share of the Revolving Credit Facility Commitment. The
Commitment Fee shall be payable quarterly in arrears, commencing on December
31, 1995, continuing on the last day of each September, December, March, and
June thereafter so long as the Revolving Credit Facility Commitment is
outstanding, and on the date of final termination of the Revolving Credit
Facility Commitment. The Commitment Fee that is due and payable on December
31, 1995, shall cover the period of time from the Closing Date to December
31, 1995. On or before the Closing Date, Borrower shall pay to Agent the
Commitment Fee (as defined and payable under the 1993 Credit Agreement),
covering the period of time from October 1, 1995 through the day prior to the
Closing Date. The Commitment Fee shall be equal to the then extant
Applicable Commitment Fee Percentage, per annum, times the average daily
amount of the unfunded portion of the Revolving Credit Facility Commitment
(decreased by the average daily amount of the Letter of Credit Usage during
the applicable period) and shall be calculated, as set forth in Section 2.7
hereof, on the basis of a year of three hundred sixty-five (365) or three
hundred sixty-six (366) days, as applicable, for the actual number of days
elapsed.
2.14 Agent's Fees. As and when agreed to in the Agent's Fee
Letter, Borrower agrees to pay to Agent, for its own account, the Agent's
Fees.
2.15 Increased Costs. If after the Closing Date, (a) the adoption
of, or any change in, any applicable law, rule, or regulation, or any change
in the interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof, or compliance by
any Bank (or its Lending Office) with any request, guideline, or directive
(irrespective of whether having the force of law) of any governmental
authority (a "Regulatory Change") shall impose, modify, or deem applicable
any reserve, special deposit, or similar requirement (including any such
requirement imposed by the Federal Reserve Board, but excluding with respect
to any LIBOR Rate Loan any such requirement included in the calculation of
the LIBOR Rate) against Assets of, deposits with, or for the account of, or
credit extended by, any Bank's Lending Office or shall impose on any Bank (or
its Lending Office) or the inter-bank eurodollar market any other condition
affecting its LIBOR Rate Loans or its obligation to make LIBOR Rate Loans, or
(b) Borrower prepays or converts any LIBOR Rate Loan prior to the end of its
applicable Interest Period, and the result of any of the foregoing is to
increase the cost to such Bank (or its Lending Office) of making or
maintaining any LIBOR Rate Loan, or to reduce the amount of any sum received
or receivable by such Bank (or its Lending Office) under this Agreement with
respect thereto, or results in any loss or expense (including any loss or
expense incurred by reason of the liquidation or re-employment of deposits or
other funds acquired by such Bank to fund or maintain outstanding its pro
rata share of the principal amount of the Loans, but not including any loss
of profit) by an amount deemed by such Bank to be material, then, such Bank
may, by written notice given to Borrower, require Borrower to pay to such
Bank such additional amounts as shall compensate such Bank for such increased
cost, reduction, loss, or expense for the ninety (90) day period preceding
the date on which such notice is given and during each fiscal quarter
thereafter. Any such request for compensation by a Bank under this Section
2.15 shall set forth the basis of calculation thereof and shall, in the
absence of manifest error, be conclusive and binding for all purposes. In
determining such amount, such Bank may use any reasonable averaging or
attribution methods.
2.16 Illegality. If any Bank shall determine that it has become
unlawful, as a result of any Regulatory Change, for such Bank to make,
convert into, or maintain a LIBOR Rate Loan as contemplated by this
Agreement, such Bank promptly shall give notice of such determination to
Borrower (through the Agent) and, thereafter, (a) the obligation of such Bank
to make, convert into, or maintain LIBOR Rate Loans shall be suspended until
such Bank gives notice that the circumstances causing such suspension no
longer exist, and (b) each of such Bank's outstanding LIBOR Rate Loans shall,
if requested by such Bank, be converted into a Base Rate Loan not later than
upon the expiration of the Interest Period related to such LIBOR Rate Loans,
or, if earlier, on such date as may be required by the applicable Regulatory
Change, as shall be specified in such request. Any such determination shall,
in the absence of manifest error, be conclusive and binding for all purposes.
2.17 Taxes.
(a) All payments made by Borrower in connection with this
Agreement shall be made free and clear of, and without reduction for or on
account of, any present or future income, stamp or other Taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any country (or by any
political subdivision or taxing authority thereof or therein) on any of the
Banks, excluding Taxes on, or measured by, or with respect to net income,
alternative minimum taxable income under Code Section 55, dividend equivalent
amount under Code Section 884, franchise, or capital stock imposed by (i) the
United States of America or any political subdivision or taxing
authority thereof or therein (including Puerto Rico), or (ii) the countries
in which any Bank is organized or its Lending Office or principal executive
office may be located or are conducting business or any political
subdivision or taxing authority
thereof or therein except any country or state or political subdivision
thereof that imposes taxes on any Bank solely as a result of this Agreement
or Borrower's or any of its Subsidiaries' presence in that country. If any
such non-excluded Taxes are required to be deducted or withheld from any such
payments to any Bank, the amounts of such payments shall be increased to the
extent necessary in order that the amount of such payment to such Bank (after
payment of all Taxes) shall equal the amount which would have been received
by such Bank in the absence of such Taxes, or any such other amounts payable;
provided, however, that in the event that payments to any Bank are required
to be increased as a result of any non-excluded Taxes imposed by any country
(excluding the United States), Borrower shall be entitled to substitute for
such Bank any other bank or financial institution reasonably acceptable to
the Majority Banks. Whenever any such non-excluded Taxes are payable by
Borrower, as promptly as possible thereafter, Borrower shall send to Agent,
for the account of such Bank, a certified copy of the original official
receipt, if any, received by Borrower showing payment thereof. If Borrower
fails to pay non-excluded Taxes when due to the appropriate taxing authority
or fails to remit to Agent, for the account of Banks, the required receipts
or other required documentary evidence, Borrower shall indemnify Banks for
any incremental non-excluded Taxes that may become payable by Banks and all
costs and expenses related thereto (including reasonable attorneys fees) as a
result of any such failure.
(b) Section 2.17(a) hereof to the contrary notwithstanding,
in the event that a Foreign Bank becomes a signatory to this Agreement,
Borrower shall withhold tax with respect to payments to such Foreign Bank in
accordance with the United States federal income tax laws in effect and shall
have no obligation to make payments to such Foreign Bank that are free and
clear of such withheld amounts, unless such Foreign Bank promptly shall
deliver to Agent and Agent delivers to Borrower duly executed certificates in
duplicate to the effect that as of that date such Foreign Bank is entitled to
receive all payments made hereunder without deduction or withholding of
United States federal income tax: (i) pursuant to the terms of an applicable
tax treaty in effect with the United States of America (in which case such
certificates shall be accompanied by two executed copies of Form 1001 of the
Internal Revenue Service),(ii) under Code Section 1441(c) (in which case such
certificates shall be accompanied by two executed copies of Form 4224 of the
Internal Revenue Service), or (iii) pursuant to an exemption certificate
received from the Internal Revenue Service (in which case such certificates
shall be accompanied by a copy of said exemption certificate). During the
term of this Agreement, each Foreign Bank shall file such additional Forms
1001 or 4224 as the case may be, as may be required by law or reasonably
requested by Borrower. Each Foreign Bank, upon becoming aware of the
occurrence of any event requiring a change in its prior certificate, promptly
shall deliver to Agent for delivery to Borrower duly executed certificates to
the effect that (as the case may be): (y) such Foreign Bank is not capable
of receiving future payments hereunder without deduction or withholding of
United States federal income tax; or (z) such Foreign Bank is capable of
receiving all payments hereunder without deduction or withholding of United
States federal income tax, pursuant to a tax treaty of the United States,
pursuant to Code Section 1441(c), or pursuant to an exemption certificate
received from the Internal Revenue Service, a copy of which shall be
attached to such certificate.
In the event that the Internal Revenue Service notifies Borrower
that Borrower improperly failed to withhold tax with respect to payments to
such Foreign Bank: (aa) Borrower timely and fully shall pay such tax to the
Internal Revenue Service and such Foreign Bank immediately, upon notice of
such payment by Borrower, shall pay to Borrower an amount necessary in order
that the amount of such payment to Borrower after payment of all Taxes with
respect to such payment shall equal the amount that Borrower has paid to the
Internal Revenue Service pursuant to this clause; and (bb) Borrower shall
have no obligation to make payments to such Foreign Bank that are free and
clear of such withheld amounts, until such Foreign Bank delivers to Agent for
delivery to Borrower the duly executed certificates described in this
subsection that entitle such Foreign Bank to receive all payments made
hereunder without deduction or withholding of United States federal income
tax.
A n y t h i ng to the contrary contained in this clause (b)
notwithstanding, to the extent that a Bank is unable to deliver a certificate
or form required hereunder as a result of a change in applicable law, such
inability shall not adversely affect such Bank's rights to reimbursement
under clause (a) of this Section 2.17.
(c) The Agent agrees with the Borrower that the Agent will
u s e reasonable efforts to (i) solicit relevant federal income tax
documentation (including Form 4224 or Form 1001 as appropriate) from each
Bank necessary to allow the Agent properly to withhold and report federal
income taxes on payments made hereunder, (ii) report to the Internal Revenue
Service all reportable income paid hereunder by the Agent to any Bank that is
not a domestic corporation (as such term is defined in Section 7701 of the
Code) for federal income tax purposes on Form 1042, Form 1042S, or other
appropriate form, (iii) deliver to each Bank that is not a domestic
corporation (as such term is defined in Section 7701 of the Code) for federal
income tax purposes a Form 1042S or other appropriate form by the filing due
date, including any extensions thereof obtained by the Agent, of such form
following any year in which payment is made hereunder by the Agent to such
Bank, and (iv) upon request of the Borrower, deliver copies of all forms and
documentation referred to in this sentence to the Borrower.
2.18 Lending Offices. The Loans made by each Bank may be made from
and maintained in such offices of such Bank, or its Affiliates (each a
"Lending Office") as such Bank may from time to time designate to Borrower
and the Agent (irrespective of whether such office is specified on Schedule
11.3 hereto). A Bank shall not elect a Lending Office that, at the time of
the making of such election, increases the amounts that would have been
payable by Borrower to such Bank under this Agreement in the absence of such
election. With respect to LIBOR Rate Loans made from and maintained at such
Bank's foreign offices or Affiliates, the obligation of Borrower to repay
such LIBOR Rate Loans shall nevertheless be to such Bank and shall, for all
purposes of this Agreement (including for purposes of the definition of the
term "Majority Banks") be deemed made, or maintained by it, for the account
of such office or Affiliate.
2.19 Funding Sources. Nothing herein shall be deemed to obligate
any Bank to obtain the funds to make any Loan hereunder in any particular
place or manner and nothing herein shall be deemed to constitute a
representation by any Bank that it has obtained or will obtain such funds in
any particular place or manner.
2.20 Holidays. Any principal or interest in respect of a Loan that
otherwise would become due on a day other than a Domestic Business Day,
instead shall become due on the next succeeding Domestic Business Day and
such adjustment shall be reflected in the computation of interest; provided,
however, if any such extension shall cause a LIBOR Rate Loan to be due in the
next calendar month, then such amount shall be due on the next preceding
LIBOR Business Day.
2.21 Place of Borrowings. All Borrowings made hereunder shall be
disbursed by credit to Borrower's deposit account with Agent maintained by
Borrower at Agent's office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or as may otherwise be agreed to by Borrower and Agent.
2.22 Time and Place of Payments.
(a) Borrower shall make each payment hereunder or on the
Notes by making, or causing to be made, the amount thereof available to Agent
in Dollars in immediately available funds at Agent's main branch office
located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ not later
than 9:00 a.m., California time, on the day of payment (except in the case of
(i) compensation pursuant to Section 2.15 hereof, and (ii) interest paid in
respect of a LIBOR Rate Borrowing as to which any Bank shall have requested
conversion of a LIBOR Rate Loan to a Base Rate Loan in a principal amount
equal to the principal amount thereof pursuant to Section 2.16 hereof,
respectively). In the absence of timely receipt, such funds shall be deemed
to have been paid by Borrower on the next succeeding Domestic Business Day.
(b) Without limitation of any Bank's rights of setoff
provided for and contemplated by Section 11.15 hereof or by law, Agent shall
have the right to charge (i.e., debit) any account of Borrower maintained
with Agent for the amount of any payment due hereunder or on the Notes by
Borrower.
2.23 Increased Risk-Based Capital Cost. If any Bank determines
that the cost (including any additional cost attributable to any reduction of
a Bank's rate of return on its equity or Assets) to such Bank of maintaining
its share of the Revolving Credit Facility Commitment is increased because of
the adoption of, or any change in, any law or regulation (or increase in the
capital reserve requirements imposed thereby) or any new or changed
interpretation, directive, or request (irrespective of whether having the
force of law), of any foreign or domestic court or governmental or monetary
authority, with respect to risk-based capital requirements for binding loan
commitments, such Bank may, by written notice given to Borrower, require
Borrower to pay, on demand, an amount equal to such Bank's additional costs
incurred during the ninety (90) days preceding the date on which such notice
is given and during each fiscal quarter thereafter; provided, however, that
in the event that payments to any Bank are required to be made hereunder as a
result of such additional costs, Borrower shall be entitled to substitute for
such Bank any other bank or financial institution reasonably acceptable to
the Majority Banks. Each such Bank shall state in the notice required by
this Section 2.23, in reasonable detail, the cause and amount of such
additional cost. Within thirty (30) calendar days after receipt of such
notice, Borrower may, at its option, elect to terminate that portion of the
Revolving Credit Facility Commitment that is held by such Bank.
2.24 Survivability. Borrower's obligations under Sections 2.5,
2.6, 2.15, 2.17, and 2.23 hereof shall survive repayment of the Loans and
termination of the Revolving Credit Facility Commitment hereunder.
2.25 Interest and Fees. On or before the Closing Date, Borrower
shall pay to Agent any and all accrued and unpaid letter of credit fees and
interest with respect to Loans (as defined and payable under the 1993 Credit
Agreement), covering the period of time from October 1, 1995 through the day
prior to the Closing Date. Such letter of credit fees and interest shall be
calculated as set forth in Section 2.7 of the 1993 Credit Agreement.
ARTICLE 3.
CONDITIONS TO LOANS
3.1 Conditions Precedent to Initial Loans and Letters of Credit.
The obligation of each Bank to make its initial Loan hereunder and of any
Issuing Bank to issue the initial Letter of Credit hereunder (including
without limitation the conversion of loans and letters of credit outstanding
under the 1993 Credit Agreement as provided for in Section 3.2) is, in
addition to the condition set forth in Section 3.3 hereof, subject to the
fulfillment, to the satisfaction of Agent, of each of the following
conditions on or before the Closing Date:
(a) the Closing Date shall occur on or before November 30,
1995;
(b) Borrower shall have executed and delivered to Agent this
Agreement, together with all exhibits and schedules hereto, and, at least one
(1) day prior to the Closing Date, the Disclosure Statement;
(c) Borrower shall have completed, executed, and delivered
the Notes to Agent;
(d) Agent shall have received the written opinions, dated the
Closing Date, of counsel to Borrower, in form and substance satisfactory to
Agent and its counsel, and also shall have received such written opinions of
local counsel to Agent and Banks as Agent shall reasonably require, all in
form and substance satisfactory to Agent and its counsel;
(e) Agent shall have received a certificate of corporate
status with respect to Borrower, dated within five (5) days of the Closing
Date, or confirmed by telex, if telex confirmation is available, by the
Secretary of State of Louisiana, such certificate to be issued by the
Secretary of State of Louisiana, which certificate shall indicate that
Borrower is in good standing in such state;
(f) Agent shall have received a certificate of corporate
status with respect to Mojave, dated within five (5) days of the Closing
Date, or confirmed by telex, if telex confirmation is available, by the
Secretary of State of the state of its incorporation, such certificate to be
issued by the Secretary of State (or other appropriate official) of such
state and shall indicate that Mojave is in good standing in such state;
(g) Agent shall have received certificates of corporate
status indicating that Borrower is in good standing as a foreign corporation,
dated within fifteen (15) days of the Closing Date, or confirmed by telex, if
telex confirmation is available, such certificates to be issued by each
Secretary of State (or other appropriate official) of the States of
California, Colorado, Florida, Ohio, Tennessee, and Texas;
(h) Agent shall have received certified copies of Borrower's
and Mojave's articles of incorporation;
(i) Agent shall have received copies of the by-laws of
Borrower and Mojave, certified by their respective Secretaries or Assistant
Secretaries;
(j) Agent shall have received signature and incumbency
certificates respecting the officers executing this Agreement, the Notes, and
the Loan Documents;
(k) A g ent shall have received an Officer's Compliance
Certificate from Borrower, dated as of the Closing Date, duly executed by a
Responsible Officer of Borrower, substantially in the form of Exhibit 3.1(k)
attached hereto, certifying that neither an Event of Default nor an Unmatured
E v ent of Default has occurred and is continuing and detailing the
calculations by which Borrower has determined it is in compliance with the
financial covenants contained herein;
(l) Agent shall have received the duly executed originals of
the Agent's Fee Letter and the Collateral Release Agreement and each of such
Loan Documents shall be in full force and effect. By their execution and
delivery of this Agreement, each of the Banks authorizes Agent to execute and
deliver the Collateral Release Agreement on their behalf and agrees that
Agent shall be entitled to execute such releases, terminations, or other
documents and take such other actions as are reasonably requested by Borrower
to effectuate the agreements set forth in the Collateral Release Agreement;
(m) Borrower shall have executed and delivered to Agent such
R e a l Property Collateral Documents and Personal Property Collateral
Documents, in form and substance reasonably satisfactory to Agent and its
counsel, as are necessary to grant or continue the grant to Agent, on behalf
of Banks, a Lien upon all of the Collateral in which Borrower has an
interest;
(n) Mojave shall have executed and delivered to Agent such
R e a l Property Collateral Documents and Personal Property Collateral
Documents, in form and substance reasonably satisfactory to Agent and its
counsel, as are necessary to grant or continue the grant to Agent, on behalf
of Banks, a Lien upon all of the Collateral in which Mojave has an interest;
(o) Agent shall have received the benefit of such title
policies or commitments for title insurance as Agent may request from title
c o m p anies satisfactory to Agent, in form and substance reasonably
satisfactory to Agent;
(p) Agent shall have received all of Borrower's original
stock certificates representing all of the issued and outstanding capital
stock of Mojave, and the stock powers, duly executed, relating thereto;
(q) Agent shall have received a certificate from Borrower's
Secretary or Assistant Secretary attesting to the resolutions of the Board of
Directors authorizing the execution and delivery of this Agreement, the
Notes, and the Loan Documents to be executed and delivered by Borrower, and
authorizing officers to execute same;
(r) Agent shall have received a certificate from a Secretary
or Assistant Secretary of Mojave attesting to the resolutions of Mojave's
board of directors authorizing the execution and delivery of the Loan
Documents to the extent that Mojave is a party thereto, and authorizing
officers to execute same;
(s) Agent shall have received full payment of the Agent's
Fees (to the extent payable on or before the Closing Date) and all of Agent's
fees, costs, and expenses (including the fees and expenses of Agent's
counsel, including allocated amounts for Agent's in-house counsel) incurred
in connection with the preparation, negotiation, execution, and delivery of
this Agreement, the Notes, and the Loan Documents;
(t) the representations and warranties of Borrower set forth
in Article 4 of this Agreement and in the Loan Documents shall be true and
correct in all material respects as of the Closing Date;
(u) Agent shall have received originals or copies of each of
the documents referred to in clauses (b), (d), (e), (f), (g), (h), (i), (j),
(k), (l), (m), (n), (o), (q), and (r) hereof in sufficient numbers so as to
enable Agent to provide a copy thereof to each Bank;
(v) the incurrence of the initial Loans under the Revolving
Credit Facility, and the application of the proceeds thereof, shall not
constitute a default under or breach of any term or condition of any
Contractual Obligation of Borrower or any of its Subsidiaries;
(w) no Material Adverse Change shall have occurred as a
result of one or more acts or occurrences;
(x) no injunction, writ, restraining order, or other order of
any nature inconsistent with the making of the initial Loans or the issuance
of the initial Letters of Credit hereunder, shall have been issued and remain
in force by any governmental authority; and
(y) all other documents and legal matters in connection with
the transactions contemplated by this Agreement shall have been delivered,
executed, recorded, or filed and shall be in form and substance reasonably
satisfactory to Agent and its counsel.
3.2 Conditions Concurrent to Initial Loans and Letters of Credit.
The obligation of each Bank to make its initial Loan hereunder and of any
Issuing Bank to issue the initial Letter of Credit hereunder is, in addition
to the conditions set forth in Sections 3.1 and 3.3 hereof, subject to the
fulfillment, to the satisfaction of Agent, of each of the following
conditions concurrent:
(a) all of the loans outstanding under the 1993 Credit
Agreement shall be deemed Revolving Credit Facility Loans outstanding
hereunder and Borrower shall be deemed to have submitted a timely request to
Agent that Eighteen Million Dollars ($18,000,000) of such Revolving Credit
Facility Loans bear interest at the LIBOR Rate plus the Applicable LIBOR Rate
Margin for an Interest Period of one month and that the remaining Nine
Million Five Hundred Thousand Dollars ($9,500,000) of such Revolving Credit
Facility Loans bear interest at the Base Rate; and
(b) the letters of credit issued under the 1993 Credit
Agreement that are outstanding as of the Closing Date shall remain
outstanding and shall be deemed to be Stand-By Letters of Credit issued under
Article 2 of this Agreement.
3.3 Conditions Precedent to All Loans. The obligation of each
Bank to make each Loan hereunder and of any Issuing Bank to issue any Letter
of Credit hereunder is subject to the fulfillment, to the satisfaction of
Agent, at or prior to the time of the making of such Loan or the issuance of
such Letter of Credit, of each of the following further conditions:
(a) the representations and warranties of Borrower and Mojave
contained in this Agreement and the Loan Documents, to the extent that each
is a party thereto, shall be true and correct in all material respects at and
as of the date of such Loan, as though made on and as of such date (except to
the extent that such representations and warranties expressly relate solely
to an earlier date);
(b) neither an Event of Default nor an Unmatured Event of
Default shall have occurred and be continuing on the date of such Loan or
Letter of Credit, nor shall either or both result from the making of such
Loan or the issuance of such Letter of Credit;
(c) no Material Adverse Change shall have occurred, as a
result of one or more acts or occurrences;
(d) Borrower shall have delivered to Agent a Notice of
Borrowing pursuant to the terms of Section 2.8 hereof; and
(e) No injunction, writ, restraining order, or other order of
any nature preventing any Bank from funding any portion of the Loans or
issuing a Letter of Credit shall have been issued and remain in force by any
governmental authority.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES OF BORROWER
In order to induce Agent and each of the Banks to enter into this
Agreement, Borrower makes the following representations and warranties,
which, except as set forth in the Disclosure Statement with a specific
reference to the section of this Article 4 affected thereby, shall be true,
correct, and complete in all material respects as of the Closing Date and at
and as of the date of each Loan made or Letter of Credit issued thereafter,
as though made on and as of the date of such Loan or Letter of Credit (except
to the extent that such representations and warranties expressly relate
solely to an earlier date), such representations and warranties to survive
the execution and delivery of this Agreement and the Notes and the making of
the Loans and the issuance of Letters of Credit:
4.1 Organization, Powers, Good Standing, and Subsidiaries.
(a) Organization and Powers. Each of Borrower and Borrower's
Subsidiaries is a corporation duly organized, validly existing, and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite corporate power and authority to own and operate its properties,
and to carry on its business as now conducted and proposed to be conducted.
Borrower has all requisite corporate power and authority to enter into this
Agreement and the Loan Documents to which it is a party, to issue the Notes,
and to carry out the transactions contemplated hereby and thereby. Mojave
has all requisite corporate power and authority to enter into the Loan
Documents to which they are parties, and to carry out their respective
o b l igations contemplated thereby. Each of Borrower and Borrower's
Subsidiaries possesses all franchises, certificates, licenses, permits, and
other authorizations from governmental or regulatory authorities that are
necessary in order to prevent the occurrence of a Material Adverse Effect and
Borrower and its Subsidiaries are not in violation thereof in any material
respect.
(b) Good Standing. Each of Borrower and its Subsidiaries is
in good standing in each state where the absence to be so qualified would
have a Material Adverse Effect.
(c) Subsidiaries. Borrower has no Subsidiaries other than
those that are identified in the Disclosure Statement. The Disclosure
Statement correctly sets forth the number of shares of each class of common
and preferred stock authorized for each of Borrower's Subsidiaries, and the
number outstanding and the percentage of the outstanding shares of each such
class owned (directly or indirectly) by Borrower or one or more of such
Subsidiaries. The capital stock of Borrower and each of its Subsidiaries is
duly authorized, validly issued, and fully paid and nonassessable. Except
for Investments permitted under Section 6.3, neither Borrower nor any of its
Subsidiaries, individually or collectively, owns or holds, directly or
indirectly, in the aggregate, any capital stock or equity security of, or any
equity interest in any corporation or business, other than Borrower's
Subsidiaries.
4.2 Authorization of Borrowing, etc.
(a) Authorization of Borrowing. The execution, delivery, and
performance by Borrower of this Agreement, the Loan Documents to which it is
a party, and the Notes have been duly authorized by all necessary corporate
action.
(b) Authorization of Subsidiaries' Loan Documents. The
execution, delivery, and performance by Mojave of the Loan Documents to which
it is a party have been duly authorized by all necessary corporate action.
(c) No Conflict - Borrower. The execution, delivery, and
performance by Borrower of this Agreement, the Loan Documents to which it is
a party, and the Notes do not and will not: (a) violate any provision of
federal, state or local law or regulation (including Regulations G, T, U, and
X of the Federal Reserve Board) applicable to Borrower, the articles of
incorporation or bylaws (or other charter documents) of Borrower, or any
order, judgment, or decree of any court or other agency of government binding
on Borrower; (b) conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any Contractual Obligation
or material lease of Borrower; (c) result in or require the creation or
imposition of any Lien of any nature whatsoever upon any Assets of Borrower,
other than Permitted Liens; or (d) require any approval of stockholders or
any approval or consent of any Person under any Contractual Obligation of
Borrower.
(d) No Conflict - Mojave. The execution, delivery, and
performance by Mojave of the Loan Documents to which it is a party do not and
will not: (a) violate any provision of federal, state, or foreign law or
regulation applicable to Mojave, the articles of incorporation or by-laws (or
other charter documents) of Mojave, or any order, judgment, or decree of any
court or other agency of government binding on Mojave; (b) conflict with,
result in a breach of or constitute (with due notice or lapse of time or
both) a default under any Contractual Obligation or material lease of Mojave;
(c) result in or require the creation or imposition of any Lien of any nature
whatsoever upon any of Mojave's properties or assets other than Permitted
Liens; or (d) require any approval of stockholders or any approval or consent
of any Person under any Contractual Obligation of Mojave.
(e) Governmental Consents. Other than such as shall have
previously been obtained, the execution, delivery, and performance by
Borrower and Borrower's Subsidiaries of this Agreement, the Notes, and the
Loan Documents, to the extent that each is a party thereto, do not and will
not require any registration with, consent, or approval of, or notice to, or
other action with or by, any federal, state, foreign, or other governmental
authority or regulatory body or other Person.
(f) Binding Obligations.
(i) This Agreement, the Notes, the Loan Documents, and
all other documents contemplated hereby and thereby, when executed and
delivered by Borrower will be the legally valid and binding obligations of
Borrower, enforceable against Borrower in accordance with their respective
terms, except as enforcement may be limited by equitable principles or by
bankruptcy, insolvency, reorganization, moratorium, or similar laws relating
to or limiting creditors' rights generally.
(ii) T h e Loan Documents and all other documents
contemplated hereby and thereby, when executed and delivered by Mojave, will
be the legally valid and binding obligations of Mojave, to the extent that it
is a party thereto, enforceable against it in accordance with their
respective terms, except as enforcement may be limited by equitable
principles or by bankruptcy, insolvency, reorganization, moratorium, or
similar laws relating to or limiting creditors' rights generally.
(g) Lien Priority. Upon the proper filing of financing
statements and recordation of fixture filings, mortgages, trust deeds, and
other applicable Personal Property Collateral Documents and Real Property
Collateral Documents with the appropriate filing or recording officers in
e a ch of the necessary jurisdictions, and upon delivery of original
instruments to Agent, as applicable, the Liens granted by Borrower and Mojave
to Agent, on behalf of Banks, in their respective Assets pursuant to the Loan
Documents will be validly created, perfected, and first priority Liens,
subject only to Permitted Liens.
4.3 Financial Condition. Borrower has delivered to Agent its
consolidated audited financial statements as of December 31, 1994, certified
by Deloitte & Touche, independent certified accountants. All such statements
were prepared in accordance with GAAP and fairly present the consolidated
financial position of Borrower and its Subsidiaries as at the respective
dates thereof, and the results of operations and changes in financial
position of Borrower and its Subsidiaries for the period then ended. As of
the Closing Date, neither Borrower nor any of its Subsidiaries has, out of
the ordinary course of business, any Contingent Obligation, material
liability for taxes, material long-term lease, or material forward or
long-term commitment that is not reflected in the foregoing statements or in
the notes thereto.
4.4 Changes. There has been no Material Adverse Change.
4.5 Title to Properties; Liens; Properties. Except as disclosed
in Borrower's annual report on Form 10-K for its fiscal year ended December
31, 1994, or on its Form 10-Q for its fiscal quarter ended June 30, 1995, and
except for the Permitted Liens, all of the Assets of Borrower and each of its
Subsidiaries are free from all Liens of any nature whatsoever. Borrower and
Mojave, taken as a whole, have good and indefeasible title to each and all of
the material Assets reflected in Borrower's or Mojave's books and records as
being owned by them. Borrower and Mojave, taken as a whole, have taken all
action necessary to maintain such good and indefeasible title with respect to
such Assets.
4.6 Litigation; Adverse Facts. There is no action, suit,
proceeding, or arbitration (whether purportedly on behalf of Borrower or any
of its Subsidiaries) at law or in equity or before or by any federal, state,
municipal, or other governmental department, commission, board, bureau,
agency, or instrumentality, domestic or foreign, pending or, to the knowledge
of Borrower, threatened against or affecting Borrower or any of its
Subsidiaries that would have a reasonable possibility of resulting in any
Material Adverse Effect or reasonably may be expected to materially adversely
affect Borrower's and its Subsidiaries' ability, taken as a whole, to perform
its obligations hereunder, under the Notes, and the Loan Documents, and there
is no basis known to Borrower for any such action, suit, or proceeding.
Neither Borrower nor any Subsidiary of Borrower is: (a) in violation of any
applicable law, rule, or regulation in a manner that has a Material Adverse
Effect or could reasonably be expected to have a Material Adverse Effect; or
(b) subject to or in default with respect to any final judgment, writ,
injunction, decree of any court or federal, state, municipal, or other
g o v ernmental department, commission, board, bureau, agency, or
instrumentality, domestic or foreign, in a manner which could reasonably be
expected to have a Material Adverse Effect. There is no action, suit,
proceeding, or investigation pending or, to the knowledge of Borrower,
threatened against Borrower or any Subsidiary of Borrower, that questions the
validity or the enforceability of this Agreement or the Notes.
4.7 Payment of Taxes. All tax returns and reports of Borrower and
its Subsidiaries (or all taxpayers with which Borrower or any of its
Subsidiaries is or has been consolidated or combined) required to be filed by
any of them have been timely filed, and all Taxes, assessments, fees, amounts
required to be withheld and paid to a governmental agency or regulatory
authority, and other governmental charges upon Borrower and its Subsidiaries,
and upon their respective Assets, income, and franchises that are due and
payable have been paid when due and payable, except to the extent that the
failure to file returns and reports with respect to such Taxes, assessments,
fees, and other governmental charges or the failure to pay the same would not
be material to the condition (financial or otherwise) of Borrower and its
Subsidiaries, taken as a whole, and except to the extent such Taxes,
assessments, fees, and other governmental charges are being contested
diligently and in good faith by appropriate proceedings with adequate
reserves or other appropriate provision, if any, having been made therefor as
required to be in conformity with GAAP. Borrower does not know of any
proposed, asserted, or assessed tax deficiency against it or any of its
Subsidiaries that would be material to the condition (financial or otherwise)
of Borrower and its Subsidiaries, taken as a whole. Neither Borrower, nor
any of its Subsidiaries, is a party to, bound by, or obligated under any tax
sharing or similar agreement with any Person that is not Borrower or one of
its Subsidiaries and that is reasonably likely to result in a Material
Adverse Effect. No Taxes, assessments, charges, or claims have become the
subject of a filed federal tax Lien on any of Borrower's or Mojave's Assets.
4.8 Materially Adverse Agreements; Performance.
(a) Agreements. Neither Borrower nor any of its Subsidiaries
is a party to or is subject to any material agreement or instrument or
charter or other internal restriction that has or reasonably could be
expected to have a Material Adverse Effect.
(b) P e r f o rmance. Neither Borrower nor any of its
Subsidiaries is in default in the performance, observance, or fulfillment of
any of the obligations, covenants, or conditions contained in any of its
Contractual Obligations, and no condition exists that, with the giving of
notice or the lapse of time or both, would constitute such a default, except
where the consequences, direct or indirect, of such default or defaults, if
any, would not have a Material Adverse Effect.
4.9 Governmental Regulation. Neither Borrower nor any of its
Subsidiaries is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Interstate Commerce Act (to
the extent it would limit its ability to incur Debt for money borrowed), or
the Investment Company Act of 1940, or to any United States federal or state
statute or regulation limiting its ability to incur Debt for money borrowed.
4.10 Securities Activities. Borrower and its Subsidiaries are not
engaged principally, or as one of their principal activities, in the business
of extending, or arranging for the extension of, credit, for the purpose of
" p urchasing" or "carrying" any margin stock (within the meaning of
Regulations G, T, U, or X of the Federal Reserve Board) as now or from time
to time in effect. No part of any Borrowing will be used by Borrower to
purchase or carry any such margin stock, or to extend credit to others for
the purpose of purchasing or carrying any such margin stock in violation of
Regulations G, T, U, or X of the Federal Reserve Board.
4.11 Employee Benefit Plans.
(a) Borrower and its ERISA Affiliates are in compliance in
all material respects with all applicable provisions of ERISA and published
i n t e r pretations thereunder with respect to all Pension Plans and
Multiemployer Plans, the failure to comply with which would have a Material
Adverse Effect. As of the Closing Date, with respect to each of their
Pension Plans and Multiemployer Plans, Borrower and each of its ERISA
Affiliates: (a) have fulfilled in all material respects their obligations
under the minimum funding standards of ERISA; (b) have not incurred any
material and past due liability to the PBGC; and (c) have not had asserted
against them any penalty for failure to meet their minimum funding
requirements under ERISA, and each Pension Plan and Multiemployer Plan is
able to pay benefits thereunder when due under the Pension Plan documents.
(b) No Termination Event has occurred or is reasonably
expected to occur with respect to any Pension Plan administered by Borrower,
any of its ERISA Affiliates, or any administrator designated by Borrower or
any of its ERISA Affiliates which might result in any obligations or
Contingent Obligations of Borrower or any of its ERISA Affiliates to the PBGC
or any other Pension Plan, that reasonably would be expected to have a
Material Adverse Effect.
(c) Liabilities (irrespective of whether vested) under all
Pension Plans (excluding unfunded deferred compensation agreements or other
arrangements of similar nature not subject to ERISA and welfare plans not
subject to the funding requirements of ERISA) that have Assets less than
liabilities (irrespective of whether vested) that are administered by
Borrower or any of its ERISA Affiliates or any administrator designated by
Borrower or any of its ERISA Affiliates do not exceed the Assets thereunder
by more than five percent (5%) of Consolidated Tangible Net Worth.
(d) Neither Borrower nor any of its ERISA Affiliates has
incurred or reasonably expects to incur any withdrawal liability under ERISA
to any Multiemployer Plan which would have a Material Adverse Effect.
(e) To the extent that any Pension Plan (that is a "welfare
plan" under Section3(1)of ERISA)is insured, Borrower and its Subsidiaries do
not have unpaid premiums in excess of Two Million Dollars ($2,000,000) that
are required to be paid for all periods through and including the ClosingDate.
To the extent that any Pension Plan (that is a "welfare plan" as defined
above) is not or has not been funded with insurance, Borrower and its ERISA
Affiliates do not have unmade contributions in excess of Five Million Dollars
($5,000,000) that are required to be paid for all periods through and
including the Closing Date, and such Pension Plans, to the extent that their
funding is based on actuarial principles, are based on reasonable and prudent
assumptions that are actuarially sound.
4.12 Disclosure. As of the date hereof and as of the Closing Date,
no representation or warranty of Borrower contained in this Agreement or any
other document, certificate, or written statement furnished to Agent or
Banks, or any of them, by or on behalf of Borrower with respect to the
business, operations, Assets, business prospects, or condition (financial or
otherwise) of Borrower or any of its Subsidiaries for use in connection with
the transactions contemplated by this Agreement, contains any untrue
statement of a material fact or omits to state a material fact (known to
Borrower in the case of any document not furnished by it) necessary in order
to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading. There is no fact
known to Borrower (other than matters of a general economic nature) that has
resulted in a Material Adverse Change that has not been disclosed herein or
in any other documents, certificates, and statements furnished to Agent,
Banks, or any of them, for use in connection with the transactions
contemplated hereby. Borrower has furnished or, under the terms of this
Agreement, is to furnish to Agent, on behalf of Banks, certain financial
information concerning Borrower and its Subsidiaries, including estimates and
projections of Borrower's and its Subsidiaries' results of operations and
financial position for and as at the end of certain future periods. Such
estimates, projections, valuations, and similar matters have been prepared by
Borrower in good faith on a basis it believes to be reasonable. Other than
as to projections, estimates, valuations, and similar matters (as to which
the preceding sentence applies), and other than as to financial statements
and other financial and accounting information (as to which Section 6.15
applies), there are no statements or conclusions contained in any document,
certificate, or written statement that Borrower is to furnish under the terms
of this Agreement, including without limitation the Disclosure Statement, to
Agent, on behalf of Banks, that, when taken as a whole, in light of the
circumstances under which they are or were made, to the knowledge and belief
of Borrower at the time provided, are based on or include materially
misleading information or fail to take into account material information
regarding the matters covered therein.
4.13 Debt. Neither Borrower nor any of its Subsidiaries has any
Debt outstanding on the date of this Agreement other than the Debt disclosed
in the financial statements referred to in Section 4.3 hereof (other than
Debt created under the 1993 Credit Agreement), set forth on the Disclosure
Statement, or permitted by Section 6.1 hereof.
4.14 Trademarks, etc. Borrower and each of its Subsidiaries own,
or hold licenses in, all trademarks, trade names, copyrights, patents, patent
rights, and licenses which are necessary in all material respects to conduct
their respective businesses and to operate their respective properties as now
conducted and operated. The consummation of the transactions contemplated by
this Agreement and the Loan Documents will not alter or impair any of such
rights of Borrower or any of its Subsidiaries. Neither Borrower nor any of
its Subsidiaries has been charged or is overtly being threatened to be
charged with any infringement of, nor has any of them infringed on any
unexpired trademark, trademark registration, trade name, patent, copyright,
copyright registration, or other proprietary right of any Person, that could
reasonably be expected to have a Material Adverse Effect.
4.15 E x i sting Defaults. Neither Borrower nor any of its
Subsidiaries is in default under any material term of any mortgage,
indenture, deed of trust, or any other agreement to which it is a party or by
which it or any of the properties owned by it may be bound, the effect of
which would be a Material Adverse Effect. Neither Borrower nor any of its
Subsidiaries is in violation of any law, ordinance, rule or regulation to
which it or any of its properties is subject, the failure to comply with
which would have a Material Adverse Effect.
4.16 Leases. Borrower and each of its Subsidiaries enjoy peaceful
and undisturbed possession under all leases material to the business,
operations and financial condition of Borrower and its Subsidiaries, taken as
a whole, to which any of them is a party or under which any of them is
operating. All of such leases are valid and subsisting and no default by
Borrower or any of its Subsidiaries exists under any of them that reasonably
could be expected to have a Material Adverse Effect.
4.17 Burdensome Agreements, etc. Borrower and its Subsidiaries,
are not, individually or in combination, party to any unduly burdensome
agreement or undertaking, or subject to any unduly burdensome court order,
writ, injunction, or decree of any court or governmental instrumentality,
domestic or foreign, which has a Material Adverse Effect.
4.18 Fire, Explosion, and Labor Disputes. Neither the business nor
the properties or operations of Borrower or any of its Subsidiaries are
currently affected by any fire, explosion, accident, strike, lockout or other
labor dispute, drought, storm, hail, earthquake, embargo, act of God or of
the public enemy or other casualty (whether covered by insurance), which has
a Material Adverse Effect.
4.19 Location of Assets and Chief Executive Offices. The chief
executive offices of Borrower and Mojave are located at the addresses
indicated on the Disclosure Statement. Except as otherwise permitted by
Section 6.16, the Collateral (other than Collateral that has been delivered
to the Agent) is located at any one of the locations of Borrower or Mojave
identified on the Disclosure Statement.
4.20 Environmental Condition.
(a) Except as specifically authorized by, or in compliance in
all material respects with, law or pursuant to valid and effective permits or
other appropriate forms of governmental approval, none of the present or
previously-owned real property, or other Assets of Borrower or any of its
Subsidiaries, has, to the best of Borrower's knowledge, ever been used by
previous owners or operators in the disposal of or to generate, manufacture,
produce, store, handle, treat, transfer, release, process, or transport any
Hazardous Waste or Hazardous Substance, and Borrower and its Subsidiaries do
not now and have not in the past used such real property, or other Assets of
Borrower or any of its Subsidiaries, for the purpose of disposal of,
generating, manufacturing, producing, storing, handling, treating,
transferring, releasing, processing, or transporting any Hazardous Waste or
Hazardous Substance, except as permitted by law and subject to the proviso to
Section 5.9(a).
(b) (i) To the best of Borrower's knowledge and belief after
due inquiry, none of the present real property, or other Assets owned or
operated by Borrower or any of its Subsidiaries, has been designated, listed,
or identified in any manner by the EPA or any other federal, state, or local
governmental agency charged with administering and enforcing an Environmental
Protection Statute, pursuant to RCRA or CERCLA or any other Environmental
Protection Statute, as a candidate for a Hazardous Waste or Hazardous
Substance corrective action or Remedial Action. (ii) To the best of
Borrower's knowledge and belief, based upon its reasonably available records,
it has received no notice that any of the previously owned real property or
other Assets of Borrower or any of its Subsidiaries has been so designated,
listed, or identified.
(c) Neither Borrower nor any of its Subsidiaries has received
notice that it has been identified as a potentially responsible party,
responsible party, or liable party at any site designated, listed, or
identified as a candidate for a Hazardous Substance investigation or Remedial
Action under CERCLA or any Environmental Protection Statute.
(d) Neither Borrower nor any of its Subsidiaries has received
notice of any Lien arising under or in connection with any Fund that attached
to any revenues or to any real or personal property owned by Borrower or any
of its Subsidiaries.
(e) Neither Borrower nor any of its Subsidiaries have
received, during the prior three (3) years, any summons, citation, notice,
directive, letter, or other communication, in writing, from the EPA or any
other federal, state, or local governmental agency or instrumentality,
authorized pursuant to an Environmental Protection Statute, or from any other
Person concerning any intentional or unintentional action or omission by
Borrower or any of its Subsidiaries resulting in the releasing, spilling,
l e aking, pumping, pouring, emitting, emptying, dumping, or otherwise
disposing of Hazardous Waste or Hazardous Substance or any other pollutant
into the Environment resulting in Damages thereto and that reasonably could
be expected to have a Material Adverse Effect.
(f) Subject to the proviso to Section 5.9(a), all activities
and operations conducted by Borrower and its Subsidiaries are in compliance
in all material respects with all Environmental Protection Statutes. To the
best of Borrower's knowledge, neither Borrower nor any of its Subsidiaries
has in the past conducted any operations or activities that were not in
compliance with all Environmental Protection Statutes and that are reasonably
likely to result in present or future liabilities to Borrower or its
Subsidiaries under any Environmental Protection Statutes that reasonably
could be expected to have a Material Adverse Effect.
(g) None of the real property or other Assets owned by
Borrower or its Subsidiaries is affected by any soil or groundwater
c o n t a m ination, attributable to any Hazardous Substance, that the
investigation and clean up of which reasonably could be expected to have a
Material Adverse Effect. To the best of Borrower's knowledge, none of the
real property previously owned by Borrower or its Subsidiaries is affected by
any soil or groundwater contamination, attributable to any Hazardous
Substance, that the investigation and clean up of which reasonably could be
expected to have a Material Adverse Effect.
4.21 No Default. No Event of Default or Unmatured Event of Default
has occurred.
4.22 Parties Intended to be Benefitted. All of the representations
and warranties contained in this Article 4 are solely for the benefit of the
Agent, the Banks, and any Person receiving an interest in the Loans or the
Notes as permitted under Section 9.2 hereof, and there are no other Persons
that are intended to be benefitted, in any way, hereby.
ARTICLE 5.
AFFIRMATIVE COVENANTS OF BORROWER
Borrower covenants and agrees that, so long as any portion of the
Revolving Credit Facility Commitment under this Agreement shall be in effect
and until payment in full of the Loans and the Notes, and any other amounts
due hereunder, and except as set forth in the Disclosure Statement with
specific reference to the Section of this Article 5 affected thereby
concerning matters which do not conform to the covenants of this Article 5,
Borrower shall, and shall cause each of its Subsidiaries to, perform each and
all of the following covenants applicable to it:
5.1 Accounting Records. Borrower shall, and shall cause each of
its Subsidiaries to, maintain adequate books and records in accordance with
sound business practices and GAAP, consistently applied.
5.2 Financial Statements and Notices. Borrower shall furnish
Agent and each Bank:
(a) as soon as practicable and, in any event, within fifty
(50) days after the close of each of the first three (3) fiscal quarters of
each fiscal year of Borrower: (i) a consolidated statement of stockholders'
equity and a consolidated statement of cash flows of Borrower and each of its
Subsidiaries for such quarterly period; (ii) consolidated and consolidating
(based upon business segments) income statements of Borrower and its
S u b sidiaries for such quarterly period; and (iii) consolidated and
consolidating (based upon business segments) balance sheets of Borrower and
its Subsidiaries as of the end of such quarterly period, each setting forth
in comparative form, if applicable, the corresponding figures for the
corresponding periods of the previous fiscal year, all in reasonable detail,
and certified by the chief financial officer of Borrower to have been
prepared in accordance with GAAP, consistently applied, subject to normal
year-end audit adjustments;
(b) as soon as practicable and, in any event, within
ninety-five (95) days after the close of each fiscal year of Borrower, a copy
of the annual audited report for such year for Borrower and its Subsidiaries,
including therein: (i) a consolidated statement of stockholders' equity and
a consolidated statement of cash flows of Borrower and its Subsidiaries for
such fiscal year; (ii) consolidated and unaudited consolidating (based upon
business segments) income statements of Borrower and its Subsidiaries for
such fiscal year; and (iii) consolidated and unaudited consolidating (based
upon business segments) balance sheets of Borrower and its Subsidiaries as of
the end of such fiscal year, each setting forth in comparative form, if
applicable, the corresponding figures for the previous year, all in
reasonable detail; the consolidated income statement and balance sheet to be
audited by independent, nationally recognized, certified public accountants,
and certified, without a "going concern" qualification or other qualification
or exception of similar gravity or any qualification arising out of the scope
of the audit (but not arising out of changes in financial accounting
standards), by such accountants to have been prepared in accordance with
GAAP, consistently applied, together with a letter of such accounting firm to
Agent, stating that its audit of the business of Borrower and its
Subsidiaries was conducted by such accounting firm in accordance with
generally accepted auditing standards;
(c) c o ntemporaneously with each quarterly and year-end
financial report required by the foregoing subsections (a) and (b), a
certificate of the chief financial officer or treasurer of Borrower stating
that he or she has individually reviewed the provisions of this Agreement,
the Notes, and the Loan Documents, and that a review of the activities of
Borrower and its Subsidiaries during such year or quarterly period, as the
case may be, has been made by or under such individual's supervision, with a
view to determining whether Borrower and its Subsidiaries have fulfilled all
of their respective obligations under this Agreement, the Notes, and the Loan
Documents, and that Borrower and its Subsidiaries have observed and performed
each undertaking contained in this Agreement, the Notes, and the Loan
Documents, to the extent that each is a party thereto, and Borrower and its
Subsidiaries are not in default in the observance or performance of any of
the provisions hereof or thereof, or if Borrower or any of its Subsidiaries
shall be so in default, specifying all such defaults and events of which such
individual may have knowledge or belief;
(d) promptly after sending or making available or filing of
the same, copies of all reports, proxy statements, and financial statements
that Borrower or any of its Subsidiaries sends or makes available to the
shareholders of Borrower and all regular and periodic reports and all filings
pursuant to Sections 13 and 15(d) of the Exchange Act and registration
statements that such Persons file with the SEC, and of all press releases and
other statements made available generally by Borrower and its Subsidiaries to
the public concerning material developments in their business or any
condition or event that would be required to be disclosed in a current report
filed by Borrower or its Subsidiaries with the SEC on Form 8-K (Items 1, 2,
3, 4, and 6 of such Form as in effect on the date hereof);
(e) notice, as soon as possible and, in any event, within
five (5) Domestic Business Days after any Responsible Officer has knowledge
of: (i) the occurrence of any Event of Default or any Unmatured Event of
Default; or (ii) any default or event of default (subject to any applicable
notice or grace period) as defined in any evidence of Debt of Borrower or any
of its Subsidiaries in excess of Two Million Dollars ($2,000,000) or under
any agreement, indenture, or other instrument under which such Debt has been
issued, irrespective of whether such Debt is accelerated or such default
waived. In either event, Borrower shall also supply Banks with a statement
from Borrower's chief financial officer or treasurer setting forth the
details and the action which Borrower proposes to take with respect thereto;
(f) as soon as possible and, in any event, within fifty (50)
days after the end of each of the first three (3) quarterly accounting
periods of Borrower in each fiscal year and within ninety-five (95) days
after the end of each of Borrower's fiscal years, an Officer's Compliance
Certificate with respect to Borrower;
(g) upon the request of the Majority Banks, together with the
delivery for any fiscal year of consolidated financial statements of Borrower
and its Subsidiaries pursuant to clause (b) above, if the Majority Banks
believe, in good faith, that there may be Hazardous Waste or Hazardous
Substances present on any of the real property constituting a portion of the
Collateral that would have a Material Adverse Effect, a written report by an
expert of recognized standing evidencing a complete and thorough inspection
of all such real property, including a geohydrological survey of soil or
subsurface conditions as well as other tests to detect the presence, if any,
of Hazardous Waste or Hazardous Substances;
(h) prompt written notice of any condition or event which has
resulted or reasonably may be expected to result in (i) a Material Adverse
Effect; (ii) a breach of or noncompliance with any term, condition or
covenant contained in this Agreement, the Notes, or the Loan Documents; (iii)
a material breach of or noncompliance with any material term, condition, or
covenant of any material contract to which Borrower or any of its
Subsidiaries is a party or by which they or their properties may be bound; or
(iv) a transfer, sale, or other disposition of Assets, an incurrence of Debt,
or any other transaction permitted under Article 6 hereof only upon
c o mpliance by Borrower and its Subsidiaries with the provisions of
Section 5.11 hereof to effect and continue the transactions contemplated by
this Agreement or the Loan Documents;
(i) prompt written notice of any claims, proceedings, or
disputes against, or to the knowledge or belief of Borrower threatened, or
affecting Borrower or any of its Subsidiaries that, if adversely determined,
would have a reasonable likelihood of having a Material Adverse Effect
(without in any way limiting the foregoing, claims, proceedings, or disputes
involving monetary amounts of Five Million Dollars ($5,000,000), or more, in
excess of any insurance coverage therefor, shall be deemed to be material for
purposes of this clause (i)), or any material labor controversy of which
Borrower has knowledge resulting in or, in the reasonable judgment of the
management of Borrower, that is reasonably likely, imminently, to result in a
strike against Borrower or any of its Subsidiaries that would threaten to
cease operations at any one or more of the Cement Plants, or any proposal of
which Borrower has knowledge by any public authority to acquire any of the
material Assets or business of Borrower or any of its Subsidiaries;
(j) promptly, upon becoming aware of the occurrence of any of
the following events, a written notice specifying the nature thereof, and,
when known, any action taken or threatened by the Internal Revenue Service,
D e p a r tment of Labor, PBGC, or other party with respect thereto:
(i) Reportable Event; (ii) "prohibited transaction," as such term is defined
in Sect.4975 of the Code, which prohibited transaction could subject Borrower
or any member of the Controlled Group to a material civil penalty assessed
pursuant to Sect.502(i)of ERISA or a material tax imposed by Section 4975 of
the Code in connection with any of Borrower's or any of its ERISA Affiliates'
Pension Plans or any trust created thereunder; (iii) failure to timely pay the
required annual payment or the full amount of a required installment for any
Pension Plan in any plan year by the due date as required under Sect.412 of
the Code; (iv)the liability for any additional premium that must be paid under
Section 4006(a)(3) of ERISA; or (v)any Lien on the Assets of any member of the
Controlled Group under the Pension Protection Act;
(k) promptly, copies of: (i) all notices received by
Borrower or any member of the Controlled Group of the PBGC's (or a foreign
country's) intent to terminate any of Borrower's or any of its ERISA
Affiliates' Pension Plans or to have a trustee appointed to administer any of
Borrower's or any of its ERISA Affiliates' Pension Plans, or of the PBCG's
demand for payment of liability under Section 4062, 4063, or 4064 of ERISA;
ii) at the request of Agent or any Bank, each annual report (IRS form 5500
series or similar series under the applicable laws of any foreign
country and all accompanying schedules), the most recent actuarial reports,
the most recent financial information concerning the financial status of
each of Borrower's and its ERISA Affiliates' Pension Plans or Multiemployer
Plans, and schedules showing the amounts contributed to each of
Borrower's and any of its ERISA Affiliates' Pension Plans or
Multiemployer Plans by or on behalf of Borrower
or its ERISA Affiliates in which any of their personnel participate or from
which such personnel may derive a benefit, and each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by Borrower or any
member of the Controlled Group with the Internal Revenue Service with respect
to each Pension Plan; and (iii) all notices received by Borrower or any
member of the Controlled Group concerning the imposition or amount of
withdrawal liability pursuant to Sect.4202 of ERISA or similar liability
under the laws of any foreign country; (iv)all notices required to be sent to
employees for failure to make a required installment or other payment
required to meet the minimum funding standard under Section 302 of ERISA;
and (v) all notifications required to be made to the PBGC for failure
to make a required installment or other payment under Section 412(n) of
the Code;
(l) promptly after the end of each fiscal year of Borrower,
but in any event on or before ninety-five (95) days after the end of each
such fiscal year, consolidating plan and financial forecasts, including a
balance sheet, income statement, and cash flow projections covering proposed
fundings, repayments, additional advances, investments, and other cash
receipts and disbursements for the forthcoming year, as customarily prepared
by the management of Borrower for internal use and any other similar reports
customarily prepared by management of Borrower pursuant to any provisions of
any instrument or documents relating to any Debt of Borrower or any of its
Subsidiaries;
(m) promptly upon becoming aware of any Person's seeking to
obtain or threatening to seek to obtain a decree or order for relief with
respect to Borrower or any of its Subsidiaries in an involuntary case under
any applicable bankruptcy, insolvency, or other similar law now or hereafter
in effect, a written notice thereof specifying what action Borrower or any
such Subsidiary is taking or proposes to take with respect thereto;
(n) promptly, copies of all material amendments to the
articles of incorporation of Borrower;
(o) contemporaneously with each year-end financial report
required by subsection (b) above, a certificate signed by the chief financial
officer or treasurer of Borrower separately identifying and describing all
Contingent Obligations of Borrower and its Subsidiaries (other than those
provided for under Section 6.4(b));
(p) as soon as practicable under the circumstances, written
notice of any proposed Permitted Acquisition involving consideration of Ten
Million Dollars ($10,000,000) or more; and
(q) with reasonable promptness, such other information and
data with respect to Borrower or any of its Subsidiaries as from time to time
reasonably may be requested by any of the Banks.
5.3 Corporate Existence, etc. Except as permitted under Section
6.7 of this Agreement, Borrower shall, and shall cause Mojave to, at all
times preserve and keep in full force and effect its and their corporate
existence and any rights and franchises material to Borrower's businesses.
5.4 Payment of Taxes and Claims. Borrower shall, and shall cause
e a ch of its Subsidiaries to pay all Taxes, assessments, and other
governmental charges imposed upon them or any of their Assets or in respect
of any of their businesses, incomes, or properties before any penalty or
interest accrues thereon, and all claims (including claims for labor,
services, materials, and supplies) for sums that have become due and payable
and that by law have or may become a Lien upon any of their properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided, however, that no such Tax, assessment, charge, or
claim need be paid if the same is being contested in good faith by
appropriate actions or proceedings promptly instituted and diligently
conducted and if an adequate reserve or other appropriate provision, if any,
shall have been made therefor as required in order to be in conformity with
GAAP; provided further, however, that the foregoing shall not be deemed to
have been breached with respect to Taxes, assessments, or other governmental
charges imposed upon Borrower or its Subsidiaries or any of their Assets if,
at the time of the imposition thereof, Borrower and its Subsidiaries are
unaware of such Taxes, assessments, or other governmental charges and so long
as, promptly after Borrower or its Subsidiaries, as applicable, have
knowledge of the Tax, assessment, or other governmental charge, the same is
either promptly paid or contested in conformity with the foregoing proviso;
provided further, however, that the Borrower and its Subsidiaries shall not
be required to pay claims that are not material in the aggregate.
5.5 Maintenance of Properties. Borrower shall, and shall cause
each of its Subsidiaries to, maintain or cause to be maintained in good
repair, working order and condition all of those Assets useful or necessary
to its business or the business of its Subsidiaries or that are used in
connection therewith or related thereto, except for Assets that, in the
aggregate, are not material to the business or operations of Borrower and its
Subsidiaries, taken as a whole.
5.6 Insurance. Borrower shall, and shall cause each of its
Subsidiaries to, maintain or cause to be maintained, with insurers that are
financially sound and reputable at the time of the issuance (or reissuance)
of such insurance, insurance with respect to its properties and business and
the properties and business of its Subsidiaries against loss or damage of the
kinds customarily insured against by corporations of established reputation
engaged in the same or similar businesses and similarly situated, of such
types and in such amounts as are customarily carried under similar
circumstances by such other corporations, and Borrower shall, from time to
time, or as otherwise required by any of the Personal Property Collateral
Documents or the Real Property Collateral Documents, deliver to Agent, as
Agent or any Bank reasonably may request, copies of policies or certificates
evidencing or describing all insurance then in effect, which certificates
shall indicate Agent, on behalf of Banks, as an additional insured or as a
loss-payee, as may be required by any of the Personal Property Collateral
Documents.
5.7 Inspection. Borrower shall permit any Persons designated by
Agent or any Bank to visit and inspect any of the properties of Borrower or
any of its Subsidiaries, including its and their financial and accounting
records, and to make copies and take extracts therefrom, and to discuss its
and their affairs, finances, and accounts with its and their officers and
independent public accountants with respect to any matters concerning or
relating to this Agreement, the Loan Documents, or the transactions
contemplated herein or therein, all upon reasonable notice and as often as
may be reasonably requested. All reasonable costs and expenses incurred by
Agent in connection therewith shall be borne by Borrower.
5.8 Compliance with Laws, etc. Borrower shall, and shall cause
its Subsidiaries to, exercise all due diligence in order to comply with the
requirements of all applicable laws, rules, regulations, and orders of any
governmental authority, noncompliance with which would have a Material
Adverse Effect; provided, however, that this Section 5.8 shall not prevent
Borrower or any of its Subsidiaries from, in good faith and with reasonable
diligence, contesting the validity or application of any such laws or
regulations by appropriate legal proceedings or actions and pending the
outcome of such legal proceedings Borrower shall not be required to comply
with such contested law or regulation so long as the failure to comply
therewith reasonably could not be expected to have a Material Adverse Effect.
5.9 Environmental Compliance and Reporting.
(a) Environmental Laws. Borrower shall, and shall cause each
of its Subsidiaries to comply, in all material respects, with all applicable
Environmental Protection Statutes other than any Environmental Protection
Statute the noncompliance with which could not reasonably be expected to have
a Material Adverse Effect; provided, however, that this Section 5.9 shall not
prevent Borrower or any of its Subsidiaries from, in good faith and with
reasonable diligence, contesting the validity or application of any such laws
or regulations by appropriate legal proceedings and pending the outcome of
such legal proceedings Borrower shall not be required to comply with such
contested law or regulation so long as the failure to comply therewith
reasonably could not be expected to have a Material Adverse Effect.
(b) Indemnification. Borrower shall, pursuant to the terms
of Section 10.2 hereof, indemnify, pay and hold Agent and each Bank harmless
from and against any and all losses, costs (including reasonable attorneys
fees and experts costs), claims, liabilities, injuries, expenses, and damages
whatsoever incurred by Agent or such Bank (i) by reason of any violation of
or noncompliance with any applicable Environmental Protection Statutes for
which Borrower, or one of its Subsidiaries, as applicable, is liable or which
is related to any real property owned, leased, or operated by Borrower or its
Subsidiaries; (ii) by reason of the imposition of any Lien for the recovery
of environmental cleanup or response costs related to any real property
owned, leased, or operated by Borrower or its Subsidiaries; (iii) by reason
of any soil or groundwater contamination, attributable to any Hazardous
Substance, affecting any real property owned, leased, or operated by Borrower
or any of its Subsidiaries; or (iv) by reason of any soil or groundwater
contamination, attributable to any Hazardous Substance, affecting any real
property in connection with which Borrower or any of its Subsidiaries is a
potentially responsible party, responsible party, or liable party under any
Environmental Protection Statute.
(c) Remedial Action. Borrower shall, and shall cause each of
its Subsidiaries to, promptly take any and all Remedial Actions required by
any federal, state, or local governmental agency under any applicable
Environmental Protection Statute; provided, however, that this Section 5.9
(c) shall not prevent Borrower and its Subsidiaries from in good faith
contesting validity, application, or liability or negotiating remediation
with regulatory agencies if appropriate reserves have been established to the
extent required by GAAP.
(d) Reporting. Borrower promptly shall advise Agent and each
Bank in writing and in reasonable detail of any administrative or judicial
proceeding subject to disclosure under 17 C.F.R. Section 229.103(5)(C) (1995).
(e) Best Efforts To Avoid Contamination. Borrower and its
Subsidiaries shall use their reasonable best efforts to avoid creating soil
or groundwater contamination, attributable to any Hazardous Substance. If
B o r rower reasonably and in good faith estimates that the cost of
i n vestigating and cleaning up any soil or groundwater contamination
attributable to any Hazardous Substance at any real property owned or
operated by Borrower or any of its Subsidiaries (which occurs notwithstanding
the previous sentence) reasonably could be expected to have a Material
Adverse Effect, Borrower promptly shall advise Agent in writing and in
reasonable detail of the contamination and estimated costs, and, upon request
from Agent, promptly shall provide and continue to provide all technical
e n v i r onmental reports and similar written evaluations relating to
contamination at the site.
5.10 Compliance with ERISA. Borrower shall, and shall take all
necessary actions to ensure that each of its ERISA Affiliates, to the extent
that Borrower or any of its Subsidiaries have direct or indirect control or
can direct or cause the direction of each of those ERISA Affiliates, take no
action that would render the representations and warranties set forth in
Section 4.11 of this Agreement inaccurate in any material respect.
5.11 Further Assurances. At any time as required under the terms
of Section 5.2(h) and Article 6 hereof or at any time or from time to time
upon the request of Agent or any Bank, Borrower shall execute and deliver,
and shall cause Mojave to execute and deliver, such further documents and do
such other acts and things as any Bank or Agent reasonably may request in
order to effect fully the purpose of this Agreement, the Notes, and the Loan
Documents and to provide for the full measure of collateral security
contemplated under the Personal Property Collateral Documents and the Real
Property Collateral Documents. In this regard, Borrower shall, or shall
cause Mojave to, as promptly as possible (and in any event with ten (10) days
after acquiring title thereto) deliver to Agent fully executed Real Property
Collateral Documents, in form and substance reasonably satisfactory to Agent,
together with title insurance policies and surveys, with respect to any
parcel of real property that is integrally related to the use or operation of
one of the Cement Plants (other than the Brooksville Plant) and that is
acquired by Borrower or Mojave after the Closing Date.
5.12 Subordinated Debt. Borrower promptly shall provide to Agent
all notices respecting the Subordinated Debt received by Borrower from any
holder (or trustee, agent or representative of any holder) thereof respecting
any material act, event, or omission, that are sent to Borrower pursuant to
the provisions of the Subordinated Indenture.
5.13 Appraisals. Borrower shall permit Agent to cause to be
conducted, at the expense of Borrower (a) upon the request of the Majority
Banks (which must include Agent), an appraisal with respect to each parcel of
real property of Borrower and Mojave that constitutes a part of the
Collateral and (b) any additional appraisals that are required under 12 CFR
Part 34.
ARTICLE 6.
NEGATIVE COVENANTS OF BORROWER
Borrower covenants and agrees that, so long as any portion of the
Revolving Credit Facility Commitment under this Agreement shall be in effect
and until payment in full of the Loans and the Notes, and any other amounts
due hereunder, and except as set forth in the Disclosure Statement with
specific reference to the Section of this Article 6 affected thereby
concerning matters that do not conform to the covenants of this Article 6,
Borrower shall, and shall cause its Subsidiaries to, perform each and all of
the following covenants applicable to it:
6.1 Debt. Borrower shall not, and shall not permit any of its
Subsidiaries to, create, incur, assume, guarantee, or otherwise become, or
remain, directly or indirectly, liable with respect to any Debt, except:
(a) Debt evidenced by the Notes and this Agreement;
(b) the Existing Subordinated Debt;
(c) So long as at the time of the incurrence thereof no Event
of Default or Unmatured Event of Default has occurred and is continuing and
so long as no Event of Default or Unmatured Event of Default would result
from the incurrence thereof, the Exchange Subordinated Debt;
(d) Commercial paper in an aggregate amount not to exceed the
Commercial Paper Letter of Credit Amount; provided, however, that to the
extent Borrower issues and has outstanding any commercial paper that is not
supported by Commercial Paper Letters of Credit, the Dollar amount of such
commercial paper shall be reserved under the Revolving Credit Facility
Commitment and shall be available for borrowing solely to repay such
commercial paper;
(e) Contingent Obligations permitted under Section 6.4 of
this Agreement;
(f) Debt resulting from Capitalized Leases;
(g) Debt disclosed in the financial statements referred to in
Section 4.3 hereof (other than Debt created under the 1993 Credit Agreement)
or Debt set forth in the Disclosure Statement;
(h) Debt owed to Borrower by its Subsidiaries to the extent
permitted under Section 6.3 of this Agreement;
(i) Debt owed by Borrower to any of its Subsidiaries;
(j) Debt secured by Permitted Liens under clause (xi) of the
definition of "Permitted Liens;"
(k) Debt (including Acquired Indebtedness) not otherwise
permitted under this Section 6.1 in an aggregate amount outstanding at any
time less than or equal to Seventy-Five Million Dollars ($75,000,000);
(l) Debt owing by any of Borrower's Subsidiaries to any of
Borrower's Subsidiaries; and
(m) Borrower or its Subsidiaries, as applicable, may become
and remain liable with respect to refinancings, renewals, or extensions of
the Debt permitted under clauses (b), (c), (f), (g), (j), (k), and (m) of
this Section 6.1 so long as (i) the terms and conditions of such
refinancings, renewals, or extensions do not materially impair the prospects
of repayment of the Loans by Borrower, (ii) such refinancings, renewals, or
extensions do not result in an increase in the aggregate principal amount of
the Debt so refinanced, renewed, or extended; provided, however, that the
foregoing shall not prohibit an increase in the aggregate principal amount of
the Debt so refinanced, renewed, or extended to the extent of any required
prepayment penalty or premium with respect thereto, (iii) such refinancings,
renewals, or extensions do not result in a shortening of the average weighted
maturity of the Debt so refinanced, renewed, or extended, and (iv) to the
e x tent that the Debt that is refinanced, renewed, or extended was
subordinated in right of payment to the Debt owed to Agent and the Banks,
then the subordination terms and conditions of the new Debt shall be at least
as favorable to Agent and the Banks as those applicable to the refinanced,
renewed, or extended Debt. For purposes of hereof, it shall be deemed to
constitute a refinancing if (a) Borrower issues new subordinated Debt (the
"New Subordinated Debt") in anticipation of prepaying Existing Subordinated
Debt so long as the proceeds of the New Subordinated Debt are utilized to
prepay Existing Subordinated Debt within a fifty (50) day period (the
"Refinancing Period") from the date on which the New Subordinated Debt is
first incurred, (b) proceeds received by Borrower from the issuance of the
New Subordinated Debt are applied to the repayment of the Loans during the
Refinancing Period and thereafter are borrowed hereunder in order to complete
the prepayment of Existing Subordinated Debt within the Refinancing Period,
or (c) proceeds received by Borrower from the issuance of the New
Subordinated Debt are utilized to acquire Cash Equivalents that are
thereafter liquidated in order to complete the prepayment of Existing
Subordinated Debt within the Refinancing Period.
6.2 Liens. Borrower shall not, and shall not permit any of its
Subsidiaries to, create, incur, assume or permit to exist, directly or
indirectly, any Lien on or with respect to any Asset of any kind of Borrower
or any of its Subsidiaries, whether now owned or hereafter acquired, or any
income or profits therefrom, except Permitted Liens.
6.3 Investments. Borrower shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly make or own any Investment in any
Person, except:
(a) Borrower and each of its Subsidiaries may make and own
Investments in Cash Equivalents;
(b) Borrower and each of its Subsidiaries may maintain any
Investment extant on the date hereof in any of Borrower's Subsidiaries or in
any other Person as such Investments are set forth in the Disclosure
Statement;
(c) Borrower and its Subsidiaries may make and own loans and
otherwise create Debt as permitted under Sections 6.1(l) and 6.1(i) hereof;
(d) so long as no Event of Default or Unmatured Event of
Default has occurred and is continuing and so long as no Event of Default or
Unmatured Event of Default would result therefrom, Borrower and its
Subsidiaries may make and own Investments not otherwise permitted under this
Section 6.3 to the extent that such Investments constitute Permitted
Acquisitions;
(e) Borrower and its Subsidiaries may make and own loans or
advances to any of their officers or employees;
(f) Borrower and each of its Subsidiaries may make and own
Investments in any debt or equity instrument (x) that matures within two
hundred seventy (270) days of the date of acquisition of the Investment and
is issued by a Person that on the date of acquisition of the Investment has a
commercial paper rating of P-1 by ▇▇▇▇▇'▇ or A-1 by S&P, or better, or such
instrument is irrevocably guaranteed or backed by an irrevocable letter of
credit from the date of acquisition of the Investment through maturity by a
Person having on the date of acquisition of the Investment a long-term debt
rating of no less than Aa by ▇▇▇▇▇'▇ or AA by S&P, or (y) matures within
thirty (30) days of the date of the Investment and is issued by a Person that
on the date of acquisition of the Investment has a commercial paper rating of
no less than P-2 by ▇▇▇▇▇'▇ or A-2 by S&P or such instrument is irrevocably
guaranteed or backed by an irrevocable letter of credit from the date of
acquisition of the Investment through maturity by a Person having on the date
of acquisition of the Investment a long-term debt rating of no less than A by
▇▇▇▇▇'▇ or A by S&P, or (z) with respect to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Insurance
Bermuda, Ltd., only, which is consistent with past practices and in an
aggregate amount not in excess of that required for collateral security and
capitalization purposes for the conduct of its business;
(g) Investments in respect of accounts receivable that have
become delinquent, including the acceptance of securities of the account
debtor obtained by Borrower or its Subsidiaries in connection with a plan of
reorganization or workout of the indebtedness of such account debtor,
together with the making of additional Investments in such account debtors so
long as the maximum amount of additional Investments made in any one such
account debtor under this clause (g) does not exceed Seven Million Five
Hundred Thousand Dollars ($7,500,000) and so long as the maximum amount of
all such additional Investments in such account debtors under this clause (g)
does not exceed Twenty Five Million Dollars ($25,000,000) in the aggregate;
(h) Borrower may annually make and own loans, advances, or
capital contributions to The Southdown Employee Benefit Trust in an amount
a c t uarially determined as the amount necessary to provide for the
satisfaction of Borrower's and its Subsidiaries' estimated health benefit
claims;
(i) Borrower may make and own loans to ▇▇▇▇▇-▇▇▇▇▇▇▇▇▇
Transport, Inc., or its Affiliates, not otherwise permitted under this
Section 6.3 in an aggregate amount not to exceed Three Million Dollars
($3,000,000) outstanding at any one time; and
(j) Borrower may make and own loans to KCC not otherwise
permitted under this Section 6.3 in an aggregate amount not to exceed Ten
Million Dollars ($10,000,000) outstanding at any one time.
6.4 Contingent Obligations. Borrower shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create or become
or be liable with respect to any Contingent Obligation, except:
(a) C o n tingent Obligations disclosed in the financial
statements and related notes referred to in Section 4.3 of this Agreement or
reflected in the Disclosure Statement and any refinancing, renewals or
extensions of such Contingent Obligations on terms substantially similar to
the original terms;
(b) Contingent Obligations incurred in the ordinary course of
business of Borrower and its Subsidiaries;
(c) Contingent Obligations not otherwise permitted under this
Section 6.4 in an aggregate amount not to exceed Fifteen Million Dollars
($15,000,000) outstanding at any one time; and
(d) Mojave may become and remain liable under the Mojave
Guaranty.
6.5 Preferred Stock. Borrower shall not, and shall not permit any
of its Subsidiaries to, create, issue, or suffer to exist any Preferred Stock
other than Permitted Preferred Stock; provided, however, that Borrower shall
be entitled to issue or assume Prohibited Preferred Stock or acquire a Person
that previously has issued Preferred Stock that would not have been Permitted
Preferred Stock if Borrower could have incurred Debt in an amount equal to
the amount of such Preferred Stock and so long as, thereafter, such Preferred
Stock is treated, for all purposes hereunder, as if it were Debt.
6.6 Financial Covenants.
(a) Leverage Ratio. Borrower shall not permit, on the final
day of any fiscal quarter ending on or after the Closing Date, its Leverage
Ratio, calculated based upon the four (4) immediately preceding fiscal
quarters, including the quarter then ended, to be greater than the
correlative amounts indicated below:
Period Ratio
Closing Date through 3.00:1.00
March 31, 1999
June 30, 1999 through 2.75:1.00
December 31, 1999
March 31, 2000 through 2.50:1.00
the Maturity Date
(b) Consolidated Tangible Net Worth. Borrower shall not
permit, as of the Closing Date, its Consolidated Tangible Net Worth to be
less than Two Hundred Twenty Million Dollars ($220,000,000). Thereafter, as
of the last date of each fiscal quarter of Borrower beginning with Borrower's
fiscal quarter ended December 31, 1995, Borrower's minimum Consolidated
Tangible Net Worth requirement shall be the amount applicable to Borrower's
immediately preceding fiscal quarter (or in the case of such determination on
December 31, 1995, Two Hundred Twenty Million Dollars ($220,000,000))(i)
increased, as of the last day of each of its second and fourth fiscal
quarters, by an amount equal to (y) one hundred percent (100%) of
Consolidated Net Income (solely to the extent that, for any such six-month
period, such number is a positive number) for such fiscal quarter and the
immediately preceding fiscal quarter; minus (z) the aggregate Dollar amount
of dividends paid or accrued (without duplication of an accrual taken in any
fiscal quarter prior to the immediately preceding fiscal quarter) by Borrower
on account of its Capital Stock during such fiscal quarter or the immediately
preceding fiscal quarter, and (ii) decreased, as of the last day of each of
its fiscal quarters, by an amount equal to the aggregate Dollar amount of
Permitted Junior Payments paid or accrued, without duplication of an accrual
taken in a prior fiscal quarter, by Borrower on account of its Capital Stock
during such fiscal quarter.
(c) Minimum Current Ratio. Borrower shall not permit, on the
last day of any fiscal quarter, the ratio of: (i) Consolidated Current
Assets to (ii) Consolidated Current Liabilities (excluding the current
portion of Funded Debt to the extent included in Consolidated Current
Liabilities) to be less than 1.25:1.00.
(d) Free Cash Flow Ratio. Borrower shall not permit, on the
final day of any fiscal quarter ending after the Closing Date, its Free Cash
Flow Ratio, calculated based upon the four (4) immediately preceding fiscal
quarters, including the quarter then ended, to be less than the correlative
amounts indicated below:
Period Ratio
Closing Date through 1.30:1.00
December 31, 1995
March 31, 1996 through 1.30:1.00
December 31, 1996
March 31, 1997 through 1.10:1.00
the Maturity Date
6.7 Restriction on Fundamental Changes. Borrower shall not, and
shall not permit Mojave to, change its name, enter into any merger or
consolidation, enter into any reorganization or recapitalization of its Debt
in connection with a troubled debt restructuring, or liquidate, wind up, or
dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
assign, lease, transfer, or otherwise dispose of, in one transaction or a
series of transactions, all or substantially all of its Assets, whether now
owned or hereafter acquired, and Borrower shall not, and shall not permit its
Subsidiaries, to acquire by purchase or otherwise all or substantially all of
the business, Assets of, or stock or other evidence of beneficial ownership
of, any Person, except:
(a) any Specified Subsidiary may be merged or consolidated
with or into Borrower or any Specified Subsidiary or be liquidated, wound up,
or dissolved, or all or any part of its business, property, or assets may be
conveyed, sold, assigned, leased, transferred, or otherwise disposed of, in
one transaction or a series of transactions, to Borrower or any Specified
S u b sidiary; provided, however, that in the case of its merger or
consolidation, Borrower shall give prior written notice to Agent thereof and
cause any such Specified Subsidiary to comply with Section 5.11 hereof to
effect and continue the transactions contemplated by this Agreement and the
Loan Documents;
(b) Borrower and its Subsidiaries may make any Investment
permitted under Section 6.3 of this Agreement;
(c) Borrower and its Subsidiaries may sell or otherwise
dispose of Assets in accordance with the provisions of Section 6.9 of this
Agreement;
(d) upon thirty (30) days prior written notice to Agent,
Borrower or Mojave may change its name;
(e) upon ten (10) days prior written notice to Agent, (i) any
of the Specified Subsidiaries may merge with and into any of the other
Specified Subsidiaries, and (ii) any of Borrower's Subsidiaries, other than
S p e cified Subsidiaries, may merge with and into any of Borrower's
Subsidiaries, other than Specified Subsidiaries; and
(f) so long as no Event of Default or Unmatured Event of
Default has occurred and is continuing and so long as no Event of Default or
Unmatured Event of Default would result therefrom, Borrower and its
Subsidiaries may make and own Permitted Acquisitions.
6.8 Sales and Lease-Backs. Borrower shall not, and shall not
permit any of its Subsidiaries to become or remain liable, directly or
indirectly, as lessee or as guarantor or other surety with respect to any
lease, whether an Operating or Capitalized Lease, of any property (whether
real, personal, or mixed real and personal) whether now owned or hereafter
acquired: (a) which Borrower or any of its Subsidiaries has sold or
transferred or is to sell or transfer to any other Person, or (b) which
Borrower or any of its Subsidiaries intends to use for substantially the same
purpose as any other property that has been or is to be sold or transferred
by Borrower or any such Subsidiary to any Person in connection with such
lease, unless such sale or transfer is permitted pursuant to Section 6.9
hereof or unless effected in compliance with the provisions of Section 5.11
hereof to effect and continue the transactions contemplated by this Agreement
and the Loan Documents.
6.9 Sale of Assets. Borrower shall not, and shall not permit
Mojave to, sell, assign, transfer, convey, or otherwise dispose of:
(a) the Collateral;
(b) the Brooksville Plant;
(c) any other Asset the absence of which would have had a
material impact upon the cash flow projections that were provided to the
Banks in connection with the consummation of this Agreement; or
(d) their accounts, general intangibles for the payment of
money, or other rights to payment of money, except that this provision shall
not preclude the sale of accounts as part of a sale of the business out of
which they arose, an assignment of accounts that is for the purpose of
collection only, a transfer of a right to payment under a contract to an
assignee that is also to do the performance under the contract, a transfer of
a single account to an assignee in whole or partial satisfaction of a pre-
existing indebtedness or any sale, discount or other disposition to Borrower.
Anything contained herein to the contrary notwithstanding, the foregoing
shall not prohibit:
(i) the sale or other disposition by any of Borrower's
Subsidiaries of Assets to Borrower;
(ii) the sale or other disposition by any of Borrower's
Subsidiaries of Assets to any of Borrower's Subsidiaries, in each case, upon
prior written notice by Borrower to Agent of same and compliance to the
extent applicable, at the request of Agent, with Section 5.11 to effect and
continue the transactions contemplated by this Agreement or the Loan
Documents;
(iii) so long as no Event of Default or Unmatured Event of
Default has occurred and is continuing and so long as no Event of Default or
Unmatured Event of Default would result therefrom, the consummation of a
Permitted Acquisition; and
(iv) the sale or other disposition of obsolete or worn out
equipment in the ordinary course of business, the sale or other disposition
of equipment in connection with the replacement thereof, or the sale or other
disposition of equipment, general intangibles, or real estate, to the extent
such equipment, general intangibles, or real estate is no longer integral to
the operation of any one or more Cement Plants.
Upon receipt of a written request from Borrower or any of its
Subsidiaries with respect to any sale or other disposition permitted under
this Section 6.9, Agent shall execute and deliver all agreements and
documents as reasonably may be requested to effect a release of the Liens
held by Agent, on behalf of Banks, upon the assets or properties that are the
subject of such sale or other disposition permitted under this Section 6.9.
6.10 Transactions with Shareholders and Affiliates. Borrower shall
not, and shall not permit any of its Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease, or exchange of any property or the rendering of any service) with any
holder of five percent (5%) or more of any class of equity securities of
Borrower or with any Affiliate of Borrower on terms that are less favorable
to Borrower or any of its Subsidiaries, as the case may be, than those terms
which might be obtained at the time from Persons who are not such a holder or
Affiliate, or if such transaction is not one that could be obtained from such
other Person, on terms that are not negotiated in good faith on an arm's
length basis.
6.11 Conduct of Business. Borrower shall not, and shall not permit
any of its Subsidiaries to, engage in any business if, as a result thereof,
the business of Borrower and its Subsidiaries, taken as a whole, would not be
substantially the same as that conducted on the Closing Date. For purposes
of this Section 6.11 and for purposes of the definition of Permitted
Acquisitions, the business of the manufacture and distribution of building
products shall be deemed to be within the types of businesses conducted by
Borrower and its Subsidiaries on the Closing Date.
6.12 Amendments or Waivers of Certain Documents. Borrower shall
not, and shall not permit any of its Subsidiaries to, agree to any amendment
to, or waive any of its rights with respect to the terms and provisions
regarding interest rates, principal or interest payment amounts, total
principal amounts, subordination provisions, events of default, or similar
terms and provisions (including applicable definitions) of the Debt, and
related indentures or agreements, referred to in subsections 6.1(b) or (c) of
this Agreement; provided, however, Borrower may agree to an amendment of such
Debt, and the related indentures or agreements, that extends the maturity
date of such Debt.
6.13 Use of Proceeds. Borrower shall not use the proceeds of the
Loans for any purpose other than for its general corporate purposes
consistent with the terms of this Agreement.
6.14 ERISA. Borrower shall not, and shall not permit any member of
the Controlled Group to:
(a) engage in any transaction that it knows or has reason to
know could subject it or any member of the Controlled Group to either a civil
penalty assessed pursuant to Section 502(i) of ERISA or a tax imposed by
Section 4975 of the Code or any penalty, tax, or other form of financial
obligation under the laws of any foreign country, that would be material
to Borrower and its Subsidiaries, taken as a whole; or
(b) permit the present value of all benefits on a termination
basis (irrespective of whether vested) under all Pension Plans (excluding
unfunded deferred compensation agreements or other arrangements of similar
nature not subject to ERISA and welfare plans not subject to funding
requirements of ERISA), with Assets less than benefits (irrespective of
whether vested) to exceed the current value of the Assets of such Pension
Plans allocable to such benefits by an aggregate amount for the Controlled
Group taken together of more than the greater of five percent (5%) of
Consolidated Tangible Net Worth; or
(c) fail to make any payments to any Multiemployer Plan that
Borrower or any of its ERISA Affiliates may be required to make under any
agreement relating to such Multiemployer Plan, or any law pertaining thereto,
that would have a Material Adverse Effect; or
(d) voluntarily terminate any one or more of their Pension
Plans, if such termination would result in the imposition of liens on
Borrower or any member of the Controlled Group under Sect.4068 of ERISA or
the applicable laws of any foreign country, in an amount that when aggregated
with all such prior liens imposed from previous Pension Plan terminations
(voluntary or involuntary) would have a Material Adverse Effect; or
(e) fail to make required contributions to any Pension Plan
subject to Sect.412(n) of the Code that with the passage of time reasonably
could result in a lien upon the Assets of Borrower or any member of its
Controlled Group, that would have a Material Adverse Effect; or
(f) except as required by law, adopt an amendment to any
Pension Plan (i) the effect of which is to increase the current liability
under that Plan for the plan year, and (ii) where the funded current
liability percentage for that plan year is less than sixty percent (60%),
after taking into account the effect of such an amendment.
As used in this Section 6.14, the term "accrued benefit" has the meaning
specified in Sect.3(23) of ERISA and the term "current value" has the meaning
specified in Sect.3(26)of ERISA; and the terms "current liability" and "funded
current liability percentage" have the meaning specified in
Sect.401(a)(29)(E) of the Code.
6.15 Misrepresentations. Borrower shall not, nor shall it permit
any of its Subsidiaries to furnish Agent or any Bank any certificate or other
document that, to its or its Subsidiaries' knowledge, contains any untrue
statement of material fact or that omits to state a material fact necessary
to make it not misleading in light of the circumstances under which it was
furnished.
6.16 Change in Location of Chief Executive Offices and Assets.
Borrower shall not, nor shall it permit Mojave to, relocate their respective
chief executive offices without first giving Agent thirty (30) days prior
written notice of any proposed relocation. Borrower shall not, nor shall it
permit Mojave to, move any of their respective Collateral (except Collateral
delivered to the Agent) to a location other than any one of their respective
locations identified in the Disclosure Statement without first giving Agent
fifteen (15) calendar days prior written notice of any such proposed
relocation; provided, however, that Borrower and Mojave shall not be
considered to be in violation of this sentence to the extent that Collateral
having an aggregate value of no more than Five Hundred Thousand Dollars
($500,000) is located at a location other than those identified in the
Disclosure Statement. To the extent that Borrower or Mojave, as applicable,
timely comply with the notice provisions set forth in this Section 6.16, and
timely comply with the provisions of Section 5.11 of this Agreement and the
comparable provisions of the Loan Documents (to the extent that each is a
party thereto), the Disclosure Statement automatically shall be deemed to be
amended to include such new locations or to reflect a change in the location
of their chief executive offices, as applicable.
6.17 Restrictive Agreements. Borrower shall not, and will not
permit any of its Subsidiaries to, enter into any agreement that restricts
the ability of such Subsidiary to make payments to Borrower by way of
dividends, advances, reimbursements, or otherwise, other than (a) customary
restrictions contained in purchase and sale agreements with respect to the
sale of Assets or Capital Stock that relate to such Assets or Capital Stock
for the period from and after the date of the execution and delivery of such
purchase and sale agreement until the date of the closing thereunder, and (b)
restrictions on Subsidiaries not wholly-owned by Borrower that are acquired
or created after the Closing Date.
6.18 Margin Regulation. No portion of the proceeds of any of the
Loans shall be used by Borrower in any manner that might cause the Borrowing,
the application of such proceeds, or the transactions contemplated by this
Agreement to violate Regulations G, T, U, or X of the Federal Reserve Board
or any other regulation of such board or to violate the Exchange Act.
6.19 Subordinated Debt, Preferred Stock, and Borrower Common Stock.
Borrower shall not, and shall not cause or permit any of its Subsidiaries to:
(a) other than Permitted Junior Payments, pay, prepay, or set
aside funds for the payment or prepayment of the principal of any
Subordinated Debt, other than in connection with a permitted refinancing
thereof;
(b) pay any amount with respect to any Subordinated Debt in
violation of the terms of the subordination provisions thereof;
(c) other than Permitted Junior Payments, redeem, repurchase,
or otherwise retire for value any Subordinated Debt, other than in connection
with a permitted refinancing thereof; or
(d) other than Permitted Junior Payments, redeem, repurchase,
or otherwise retire for value, or set aside funds for the redemption,
repurchase, or other retirement for value of any of its Preferred Stock or
the Borrower Common Stock.
6.20 Hedge Agreements. Borrower shall not, and shall not permit
any of its Subsidiaries to, become or remain liable with respect to any Hedge
Agreement unless such Hedge Agreement meets the following criteria:
(a) (i) if such Hedge Agreement relates to interest rates,
s u c h Hedge Agreement ▇▇▇▇▇▇ actual outstanding Debt (or an amount
approximating such actual outstanding Debt) of Borrower or one of its
Subsidiaries, and (ii) if such Hedge Agreement relates to commodities or
foreign currency, such Hedge Agreement is not speculative in nature and is
entered into in connection with the conduct of Borrower's or any of its
Subsidiaries' business; and
(b) the pricing and spread under such Hedge Agreement is on
market terms.
6.21 Dividends. Borrower shall not and shall not permit any of its
Subsidiaries to make or declare, directly or indirectly, any dividend (in
cash, return of capital, or any other form of Assets) or distribution on
account of any shares or interest of any class of Borrower's or its
Subsidiaries' Capital Stock, whether now or hereafter outstanding, or make
any other distribution in respect thereof, either directly or indirectly,
whether in cash, Assets, or obligations; provided, however, that the
foregoing shall not restrict the ability of:
(a) Borrower's Subsidiaries to make any dividend or other
distribution;
(b) Borrower to make any dividend or other distribution to
its shareholders consisting of shares of Borrower Common Stock or warrants or
other rights to acquire Borrower Common Stock;
(c) Borrower to make any dividend or other distribution to
the holders of Borrower Common Stock of shares of Series C Preferred Stock
pursuant to the terms and conditions of Borrower's Restated Articles of
Incorporation, as amended;
(d) so long as no Event of Default or Unmatured Event of
Default has occurred and is continuing and so long as no Event of Default or
Unmatured Event of Default would result therefrom, the payment by Borrower of
any cash dividend that constitutes a regularly scheduled dividend payment
(and not a redemption or partial redemption) with respect to Borrower's
Permitted Preferred Stock and any Prohibited Preferred Stock to the extent
that it is acquired or outstanding pursuant to the proviso to Section 6.5
hereof; and
(e) so long as no Event of Default or Unmatured Event of
Default has occurred and is continuing and so long as no Event of Default or
Unmatured Event of Default would result therefrom, Borrower may declare and
pay dividends with respect to the Borrower Common Stock; provided, however,
that if no Event of Default or Unmatured Event of Default had occurred and
was continuing on the date that Borrower declares any such dividend (or any
dividend pursuant to Section 6.21(d)) Borrower shall be entitled to pay such
dividend (or any dividend pursuant to Section 6.21(d)) notwithstanding the
occurrence and continuation of an Event of Default or Unmatured Event of
Default (other than an Event of Default or Unmatured Event of Default under
Section 7.1(a) hereof) as of the date such payment is to be made; and
(f) Borrower may make Permitted Junior Payments.
ARTICLE 7.
EVENTS OF DEFAULT
7.1 Events of Default. The occurrence of any one or more of the
following events, acts, or occurrences shall constitute an event of default
(an "Event of Default") hereunder:
(a) Failure to Make Payments When Due.
(i) B o rrower shall fail to pay any amount owing
hereunder or under any of the Notes with respect to the principal of any
Loans when such amount is due, whether at stated maturity, as a result of a
mandatory prepayment requirement, by acceleration, by notice of prepayment,
or otherwise; or
(ii) Borrower shall fail to pay, within five (5) days of
the date when due, any amount owing hereunder or under any of the Notes with
respect to interest on any of the Loans or with respect to the Commitment
Fee; or
(iii) Borrower shall fail to pay, within ten (10)
days of the date when due, any other amounts (including fees, costs, and
expenses payable to Agent or the Banks) payable in connection herewith; or
(b) Default in Other Agreements.
(i) Borrower or any of its Subsidiaries shall default
(as principal or guarantor or other surety) in the payment when due (subject
to any applicable notice or grace period), whether at stated maturity or
otherwise, of any monetary obligation on (howsoever designated) any Debt,
whether such Debt now exists or shall hereafter be created; provided,
however, that no default under this clause (i) shall occur or result from a
default in the payment of any monetary obligation on any Debt of, or Debt
guaranteed by, Borrower or any of its Subsidiaries that, when added to the
amount of all other such Debt in default, does not exceed Ten Million Dollars
($10,000,000); or
(ii) An event of default, as defined in any agreement,
mortgage, indenture, instrument, or other agreement relating thereto under
which there may be issued, or by which there may be secured or evidenced, any
Debt of, or Debt guaranteed by, Borrower or any of its Subsidiaries, whether
such Debt now exists or shall hereafter be created, shall occur and Borrower
or such Subsidiary shall permit such Debt to become or be declared due prior
to its stated maturity or due date; provided, however, that no default under
this clause (ii) shall occur or result from a default in any Debt of, or Debt
guaranteed by, Borrower or any of its Subsidiaries which, when added to the
amount of all other such Debt in default, does not exceed Ten Million Dollars
($10,000,000); or
(iii) A d e f ▇▇▇▇ by Borrower or any of its
Subsidiaries in the payment of money under any Hedge Agreement to which
Borrower or any of its Subsidiaries are parties, whether such Hedge Agreement
now exists or shall hereafter be created; provided, however, that no default
under this clause (iii) shall occur or result from a payment default in a
Hedge Agreement of Borrower or any of its Subsidiaries the net obligations
under which, when added to the aggregate amount of all net obligations under
other Hedge Agreements as to which Borrower or its Subsidiaries have
defaulted in the payment of monetary obligations, and based upon a reasonable
estimation of the net obligations under each of such Hedge Agreements, do not
exceed Ten Million Dollars ($10,000,000); or
(c) Breach of Certain Covenants.
Borrower or any of its Subsidiaries shall fail to perform or
comply with any covenant, term, or condition contained in Sections 5.2(e)(i)
or 5.12, or Article 6 of this Agreement; or
(d) Breach of Warranty.
Except to the extent qualified by the Disclosure Statement,
any financial statement, representation, warranty, or certification made or
furnished by Borrower or any of its Subsidiaries under this Agreement or in
any statement, document, letter, or other writing or instrument furnished or
delivered to any Bank or to Agent pursuant to or in connection with this
Agreement or as an inducement to Agent or any Bank to enter into this
Agreement, shall, at any time, prove to have been materially false,
incorrect, or incomplete when made, effective, or reaffirmed, as the case may
be; provided, however, if a Loan Document applicable to the Collateral or
Lien affected by such occurrence provides Borrower or its Subsidiary, as the
case may be, the right to correct or remedy the same, which occurrence is
capable of being corrected or remedied, and Borrower or its Subsidiary, as
the case may be, diligently prosecutes such correction or remedy, then the
same shall not be deemed to be an Event of Default hereunder so long as such
occurrence could not reasonably be expected to have a Material Adverse
Effect; or
(e) Other Defaults Under Agreement.
Borrower shall default in the performance of or compliance
with any term contained in this Agreement other than those referred to above
in Sections 7.1(a), (c), or (d), and such default shall not have been
remedied or waived within ten (10) Domestic Business Days after the earlier
of: (i) receipt of notice from Agent to Borrower of such default; or
(ii) the date upon which any Responsible Officer has knowledge of such
default; or
(f) Default Under Loan Documents, etc.
Borrower or any of its Subsidiaries shall fail to observe or
perform any term, covenant, condition, agreement, or obligation to be
observed or performed by it or them as applicable, under the Loan Documents,
to the extent that each is a party thereto, and (i) such failure arises out
of the granting by Borrower or any of its Subsidiaries of a Lien or the
imposition of a Lien upon any of the material Assets of Borrower or any of
its Subsidiaries in favor of any Person, except for Permitted Liens; or
(ii) such failure arises out of any other act or failure to act of Borrower
or any of its Subsidiaries which act materially adversely affects any Lien
granted in favor of Banks by Borrower or any of its Subsidiaries; provided,
however, that the failure to comply with any further assurance provisions
contained in the Loan Documents shall, per se, be deemed to materially
adversely affect such Liens; or (iii) such failure arises other than under
circumstances set forth in clauses (i) and (ii) above and continues for ten
(10) Domestic Business Days after notice to Borrower of such failure from
Agent; or (iv) such failure arises other than under circumstances set forth
in clauses (i) and (ii) above and continues for fifteen (15) Domestic
Business Days after Agent is notified of such failure by Borrower or its
Subsidiary; provided further, however, the provisions of clauses (iii) and
(iv) above notwithstanding, if, under the applicable Loan Document, Borrower
or any of its Subsidiaries has the right to cure such failure and such
failure is capable of being cured, and Borrower or its Subsidiary, as the
case may be, commences and diligently prosecutes such cure as required by the
terms of such Loan Document, then such failure shall not be deemed to be an
Event of Default hereunder so long as such failure could not reasonably be
expected to have a Material Adverse Effect; or
(g) Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) An involuntary case seeking the liquidation or
reorganization of Borrower or any of its Material Subsidiaries under
Chapter 7 or Chapter 11, respectively, of the federal Bankruptcy Code or any
similar proceeding shall be commenced against Borrower or any of its Material
Subsidiaries under any other applicable law and any of the following events
occur: (v) Borrower or any of its Material Subsidiaries, as applicable,
consents to the institution of the involuntary case; (w) the petition
commencing the involuntary case is not timely controverted; (x) the petition
commencing the involuntary case is not dismissed within sixty (60) days of
its filing; provided, however, that, during the pendency of such period, the
Banks shall be relieved of the Revolving Credit Facility Commitment; (y) an
interim trustee is appointed to take possession of all or a substantial
portion of the property or to operate all or any substantial portion of the
business of Borrower or any of its Material Subsidiaries; or (z) an order for
relief shall have been issued or entered therein; or
(ii) A decree or order of a court having jurisdiction in
the premises for the appointment of a receiver, liquidator, sequestrator,
custodian, trustee, or other officer having similar powers of Borrower or any
of its Material Subsidiaries to take possession of all or a substantial
portion of the property or to operate all or a substantial portion of the
business of Borrower or any of its Material Subsidiaries shall have been
entered and, within thirty (30) days from the date of entry, is not vacated,
discharged, or bonded against, or any similar relief shall be granted against
Borrower or any of its Material Subsidiaries under any applicable federal or
state law and, within thirty (30) days from the date of entry, is not
vacated, discharged, or bonded against; provided, however, that, during the
pendency of such period, the Banks shall be relieved of the Revolving Credit
Facility Commitment; or
(h) Voluntary Bankruptcy; Appointment of Receiver, etc.
Borrower or any of its Material Subsidiaries shall institute a
voluntary case seeking liquidation or reorganization under Chapter 7 or
Chapter 11, respectively, of the federal Bankruptcy Code; or Borrower or any
of its Material Subsidiaries shall file a petition, answer, or complaint or
shall otherwise institute any similar proceeding under any other applicable
law, or shall consent thereto; or Borrower or any of its Material
Subsidiaries shall consent to the conversion of an involuntary case to a
voluntary case; or Borrower or any of its Material Subsidiaries shall consent
or acquiesce to the appointment of a receiver, liquidator, sequestrator,
custodian, trustee, or other officer with similar powers to take possession
of all or a substantial portion of the property or to operate all or a
substantial portion of the business of Borrower or any of its Material
Subsidiaries; or Borrower or any of its Material Subsidiaries shall make a
general assignment for the benefit of creditors; or the board of directors of
Borrower or any of its Material Subsidiaries (or any committee thereof)
adopts any resolution or otherwise authorizes action to approve any of the
foregoing; or
(i) Judgments and Attachments.
(i) Borrower or any of its Subsidiaries shall suffer any
money judgment, writ, or warrant of attachment, or similar process involving
payment of money in an amount in excess of Seven Million Five Hundred
Thousand Dollars ($7,500,000) and shall not discharge, vacate, bond, or stay
the same within a period of nineteen (19) days or, in any event, within ten
(10) days of the date of any proposed sale thereunder; or
(ii) A judgment creditor shall obtain possession of
Assets of Borrower or any of its Subsidiaries having a value in excess of
Seven Million Five Hundred Thousand Dollars ($7,500,000) by any means,
including levy, distraint, replevin, or self-help; or
(j) Dissolution.
Any order, judgment, or decree shall be entered decreeing the
dissolution or division of Borrower or any of its Subsidiaries, as the case
may be, and such order shall remain undischarged or unstayed for a period in
excess of thirty (30) days; or
(k) ERISA Liabilities.
(i) Any Reportable Event (or similar occurrence under
the applicable laws of a foreign country) occurs that reasonably can be
expected to result in a liability by Borrower, or any of its ERISA
Affiliates, to the PBGC (or foreign regulatory authority), that reasonably
would be expected to have a Material Adverse Effect, and that Majority Banks
determine, in good faith, constitutes grounds for the termination of any
Pension Plan by the PBGC (or foreign regulatory authority) or for the
appointment of a trustee to administer any Pension Plan; or
(ii) Any Pension Plan maintained by Borrower, or any of
its ERISA Affiliates, shall be terminated or a trustee appointed by an
appropriate United States district court, or pursuant to the applicable law
of a foreign country, to administer any Pension Plan, or the PBGC shall
institute proceedings to terminate any Pension Plan or to appoint a trustee
to administer any Pension Plan if, as of the date thereof, Borrower's, or any
of its ERISA Affiliates' liability or the aggregate liability of Borrower, or
its ERISA Affiliates (after giving effect to the tax consequences thereof)
for unfunded vested benefits under the Pension Plans exceed the then current
value of Assets accumulated in such Pension Plans by more than five percent
(5%) of Consolidated Tangible Net Worth (or in the case of a termination
involving Borrower, or any of its ERISA Affiliates as a Substantial Employer
(within the meaning of ERISA), the withdrawing employer's proportionate share
of such excess shall exceed such amount); or
(iii) Failure to make full payment (including all
required installments) when due of all amounts which, under the provisions of
any Pension Plan or applicable law, Borrower, or any of its ERISA Affiliates,
is required to pay as contributions thereto, that would have a Material
Adverse Effect; or
(iv) Borrower, or any of its ERISA Affiliates creates any
accumulated funding deficiency as defined by ERISA, irrespective of whether
waived, with respect to any Pension Plan, that would have a Material Adverse
Effect; or
(v) Borrower, or any of its ERISA Affiliates, as an
employer under a Multiemployer Plan, shall have made a complete or partial
withdrawal from such Multiemployer Plan and the plan sponsor of such
Multiemployer Plan shall have notified such withdrawing employer that such
employer has incurred a withdrawal liability in an annual amount exceeding
Seven Million Five Hundred Thousand Dollars ($7,500,000) or the aggregate
amount of such withdrawal liabilities for Borrower and its ERISA Affiliates
together exceeds Seven Million Five Hundred Thousand Dollars ($7,500,000); or
(vi) Any Lien on the Assets of Borrower, or any of its
Subsidiaries, under the Pension Protection Act shall exceed Seven Million
Five Hundred Thousand Dollars ($7,500,000); or
(l) Termination of Loan Documents.
Any of the Loan Documents shall cease to be in full force and
effect for any reason other than: (i) any act or omission of Agent with
respect to the filing or recordation of any of such documents or other action
necessary for the perfection of Liens in favor of Agent on behalf of the
Banks; or (ii) a release or termination thereof upon the full payment and
satisfaction of the Debt due hereunder and under the Notes to Banks; or
(iii) upon the written consent of the Majority Banks; or
(m) Subordination Default.
The subordination provisions with respect to the Subordinated
Debt, at any time after the execution and delivery thereof and for any reason
other than satisfaction in full of all Debt incurred hereunder and under the
Notes, cease to be in full force and effect or are declared to be null and
void; or any holder of twenty-five percent (25%) or more of an issue thereof
denies that it has any further liability or obligation, including with
respect to any future Loans by Banks, under such Subordinated Debt or gives
notice to such effect; provided, however, neither an Unmatured Event of
Default nor an Event of Default shall be deemed to have occurred or be
continuing under this Section 7.1(m) by reason of any such denial or notice
if: (a) Borrower promptly obtains an opinion of counsel, from a law firm
reasonably acceptable to the Majority Banks, addressed to Agent, on behalf of
Banks, to the effect that any such denial or notice is not founded upon any
reasonable basis at law; and (b) Borrower immediately takes all action
necessary to obtain appropriate declaratory and injunctive relief with
respect to such denial or notice in order to preserve the full force and
effect of such subordination provisions; or
(n) Change of Control.
A Change of Control shall have occurred.
7.2 Remedies. Upon the occurrence of an Event of Default:
(i) If such Event of Default (x) arises under Section 7.1(b)
as a result of a default under the Subordinated Indenture and the Existing
Subordinated Debt is declared due prior to its stated maturity as a result of
such default or (y) arises and is continuing under Sections 7.1(g) or (h),
then the unpaid principal amount of and any accrued interest on the Loans
automatically shall become immediately due and payable, without presentment,
demand, protest, notice, or other requirements of any kind, all of which are
hereby expressly waived by Borrower and the obligation of any Bank to make
any Loan hereunder or issue any Letter of Credit hereunder shall thereupon
terminate; and
(ii) In the case of any other Event of Default which is
continuing, the Majority Banks may request Agent to and Agent thereupon
shall, by written notice to Borrower, declare all of the Loans to be and the
same shall forthwith become, due and payable, together with any and all
accrued interest thereon, and the obligation of Banks to make any Loan
hereunder or issue any Letter of Credit hereunder shall thereupon terminate.
T h e foregoing notwithstanding, if, at any time after
acceleration of the maturity of any Note, Borrower shall pay all arrears of
interest and all payments on account of principal which shall have become due
other than by acceleration (with interest on principal at the rate specified
herein) and all Events of Default and Unmatured Events of Default (other than
nonpayment of principal and accrued interest under the Notes, due and payable
solely by virtue of acceleration) have been remedied or waived pursuant to
Section 11.1 of this Agreement, then the Majority Banks, by written notice to
Borrower, may rescind and annul the acceleration and its consequences;
provided, however, that such action shall not affect any subsequent Event of
Default or Unmatured Event of Default or impair any right consequent thereon.
Upon acceleration, Agent, upon the request of the Majority
Banks, without notice to or demand upon Borrower, which are expressly waived
by Borrower, may proceed to protect, exercise, and enforce their rights and
remedies hereunder and under the Notes, or the Loan Documents and any other
rights and remedies as are provided by law or equity. The Majority Banks may
determine, in their sole discretion, the order and manner in which each
Bank's rights and remedies are to be exercised, and all payments received by
Agent or Banks, or any one or more of them, shall be applied as follows
(regardless of how each Bank may treat the payments for the purpose of its
own accounting): first, to all costs and expenses (including reasonable
attorneys fees, costs of maintaining, preserving, or disposing of any of the
real, personal, or mixed collateral and costs of settlement) incurred by
Agent, or Banks, or any of them, in enforcing any Debt of, or in collecting
any payments due from, Borrower hereunder or under the Notes or under the
Loan Documents by reason of such Event of Default; second, to all fees due
and owing to Banks or Agent, third, to accrued interest on the Loans; fourth,
to principal amounts outstanding under the Loans; fifth, to Agent, on behalf
of Banks, to be held as cash collateral, in an amount equal to the Letter of
Credit Usage in order to secure the obligations of Borrower with respect to
such Letters of Credit; sixth, pro rata, to any other Debt of Borrower owing
to Agent or Banks, or any of them; and seventh, any remainder to Borrower.
ARTICLE 8.
THE AGENT AND THE BANKS
8.1 Appointment and Powers of Agent. Each Bank hereby irrevocably
designates and appoints Agent as its agent hereunder and hereby authorizes
Agent to execute and deliver or accept, on behalf of each of the Banks, the
Loan Documents and any other documents, instruments, and agreements related
thereto or hereto and to take such action on its behalf and to exercise such
rights, remedies, powers, and privileges hereunder as are specifically
authorized to be exercised by Agent by the terms hereof, together with such
rights, remedies, powers, and privileges as are reasonably incidental
thereto. Agent may execute any of its respective duties as agent hereunder
by or through agents or employees and shall be entitled to retain counsel and
to act in reasonable reliance upon the advice of such counsel concerning all
matters pertaining to the agencies hereby created and its duties hereunder,
and Agent shall not be liable for any action taken or omitted to be taken in
accordance with the advice of counsel selected by it.
Except as required by the specific terms of this Agreement, Agent
shall have no duty to exercise any right, power, remedy, or privilege granted
to it hereby, or to ascertain whether any Event of Default or Unmatured Event
of Default has occurred and is continuing or otherwise to inquire into the
performance or observance on the part of Borrower of any term, covenant,
condition, or agreement on its part to be performed or observed, or to take
any affirmative action hereunder, unless requested or directed to do so by
the Majority Banks or all Banks, as provided herein, and shall not, without
the requisite prior approval as provided in Section 11.1 hereof, consent to
any departure by Borrower from the terms hereof, waive any default on the
part of Borrower hereunder or amend, modify, supplement, or terminate, or
agree to any surrender of, this Agreement, the Notes, or the Loan Documents.
Agent has and shall have the same rights and powers under this
Agreement, the Notes, and the Loan Documents with respect to its pro rata
share of the Revolving Credit Facility Commitment, Loans, and Letters of
Credit hereunder as each other Bank and may exercise the same as though it
were not the agent; and the terms "Bank" or "Banks" include ▇▇▇▇▇ Fargo, or
any successor agent, in its individual capacity hereunder. Agent and its
Affiliates may accept deposits from, lend money to, and generally engage in
any kind of business with Borrower, or any of Borrower's Subsidiaries or
Affiliates, as if it were not the agent hereunder and without any duty to
account therefor to Banks.
Neither Agent, nor any of its directors, officers, agents, or
employees shall be liable for any action taken or omitted to be taken by them
hereunder or in connection herewith, except for their own gross negligence or
willful misconduct; nor shall Agent be responsible to any Person for the
representations, warranties, or other statements made by any other Person or
for the due execution or delivery, validity, effectiveness, genuineness,
value, sufficiency, or enforceability against Borrower and Mojave of this
Agreement, the Notes, the Loan Documents, or any other document furnished
pursuant thereto or in connection herewith.
Each Bank hereby agrees, in the ratio that such Bank's pro rata
share of the Revolving Credit Facility Commitment bears to the total of the
Revolving Credit Facility Commitment, to indemnify, defend, and hold Agent
harmless, as agent hereunder, from and against any and all losses,
liabilities (including attorneys fees and expenses) incurred or suffered by
Agent in such capacity as a result of any action taken or omitted to be taken
by Agent in such capacity, or otherwise incurred or suffered by, made upon,
or assessed against Agent in such capacity; provided, however, that no Bank
shall be liable for any portion of any such losses, liabilities (including
liabilities for penalties), actions, suits, judgments, demands, damages,
costs, or expenses resulting from or attributable to gross negligence or
willful misconduct on the part of Agent or its directors, officers, employees
or agents. Without limiting the generality of the foregoing and subject to
the proviso above, each Bank hereby agrees, in the ratio aforesaid, to
reimburse Agent promptly following its demand for any out-of-pocket expenses
(including attorneys fees and expenses) incurred by Agent hereunder and not
reimbursed to Agent by Borrower. Each Bank's obligations under this
paragraph shall survive the termination of this Agreement and the discharge
of Borrower's obligations hereunder.
8.2 Nature of Duties; Independent Credit Investigation. Agent
shall have no duties or responsibilities except those expressly set forth in
this Agreement. The duties of Agent shall be mechanical and administrative
in nature and shall include a duty to distribute copies of this Agreement and
the Loan Documents to each Bank promptly after the Closing Date; Agent shall
not have by reason of this Agreement a fiduciary relationship in respect of
any Bank; and nothing in this Agreement, expressed or implied, is intended to
or shall be so construed as to impose upon Agent any obligations in respect
of this Agreement except as expressly set forth herein. Each Bank expressly
acknowledges: (a) that Agent has not made any representations or warranties
to it and that no act by Agent hereafter taken, including any review of the
affairs of Borrower, shall be deemed to constitute any representation or
warranty by Agent to any Bank; (b) that it has made and will make its own
independent investigation of the financial condition and affairs, and its own
appraisal of the creditworthiness, of Borrower in connection with this
Agreement; and (c) that Agent shall have no duty or responsibility, either
initially or on a continuing basis, to provide any Bank with any credit or
other information except as provided herein, whether coming into its
possession before the making of any Loans hereunder or at any time or times
thereafter.
8.3 Actions in Discretion of Agent; Instructions from Banks.
Agent agrees, upon the written request of the Majority Banks or all Banks, as
applicable, to take any action of the type specified as being within Agent's
rights, powers, or discretion herein. In the absence of a request by the
Majority Banks or all Banks, as applicable, Agent shall have authority, in
its sole discretion, to take or not to take any such action, unless this
Agreement specifically requires the consent of the Majority Banks or all
Banks, as applicable. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on all Banks and on all holders
of Notes. No Bank shall have any right of action whatsoever against Agent as
a result of Agent acting or refraining from acting hereunder in accordance
with the instructions of the Majority Banks or all Banks, as applicable, or
in the absence of such instructions, in the absolute discretion of Agent,
subject to the provisions of Section 8.1.
8.4 Exculpatory Provisions. Agent shall be under no obligation to
any Bank to ascertain the existence or possible existence of any Event of
Default or Unmatured Event of Default unless a required payment by Borrower
to Agent has not been made or unless Agent has received notice from a Bank or
Borrower stating that such notice is a "Notice of Default." In the event
that such a payment default occurs or that Agent receives such a notice of
the occurrence of an Event of Default or Unmatured Event of Default, Agent
shall give prompt notice thereof to Banks. Agent shall (subject to
Section 11.1 hereof) take such action with respect to such Event of Default
or Unmatured Event of Default as shall be directed by the Majority Banks;
provided, however, that, unless and until Agent shall have received such
directions, Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Event of Default or
Unmatured Event of Default as it shall deem advisable and in the best
interests of Banks.
8.5 Reliance by Agent. Agent shall be entitled to rely upon any
communication, instrument, paper, writing, telegram, telex, or teletype
m e ssage, resolution, notice, consent, certificate, letter, cablegram,
statement, order, other document, conversation by telephone, or otherwise,
believed by it to be genuine and correct and to have been signed, sent, or
made by the proper Person or Persons. Agent shall be fully justified in
failing or refusing to take any action hereunder unless it shall first be
indemnified to its satisfaction by Banks (in the ratio provided in
Section 8.1) against any and all liability and expense that may be incurred
by it by reason of taking or continuing to take any such actions.
8.6 Excess Payments. If any Bank or other holder of a Note shall
obtain any payment or other recovery (whether voluntary, involuntary, by
application of offset or otherwise) on account of principal or interest on
any Note or payment of Commitment Fee in excess of its pro rata share of
payments and other recoveries obtained by all Banks or holders of Notes, such
Bank or other holder shall purchase from the other Banks or holders such
participations in the Notes held by them as shall be necessary to cause such
purchasing Bank or holder to share the excess payment or other recovery
ratably with each of the other Banks or holders; provided, however, that if
all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Bank or holder, the purchase shall be
rescinded and the purchase price restored to such Bank or other holder to the
extent of such recovery, but without interest. Borrower agrees that any Bank
or holder so purchasing a participation from another Bank or holder pursuant
to this Section 8.6 may, to the fullest extent permitted by law, exercise all
o f its rights of payment (including setoff) with respect to such
participation as fully as if such Bank or holder were the direct creditor of
Borrower in the amount of such participation.
8.7 Obligations Several. The obligations of Banks hereunder are
several, and neither any Bank nor Agent shall be responsible for the
obligation of any other Person hereunder, nor will the failure of any Bank to
perform any of its obligations hereunder relieve Agent or any other Bank from
the performance of its respective obligations hereunder. Nothing contained
in this Agreement, and no action taken by Banks or Agent pursuant hereto or
in connection herewith or pursuant to or in connection with the Notes, or the
Loan Documents shall be deemed to constitute Banks, together or with Agent, a
partnership, association, joint venture, or other entity.
8.8 Resignation by Agent. Agent may resign its agency at any time
by giving at least thirty (30) days prior written notice of its intention to
do so to each Bank and to Borrower. Such resignation shall become effective
upon the earlier of: (a) the appointment by the Majority Banks of a
successor Agent (which successor Agent shall be a Bank and shall be
reasonably acceptable to Borrower), or (b) the effective date set forth in
Agent's notice of resignation. After any resigning Agent's resignation
hereunder as Agent, the provisions of this Article 8 shall continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it
was Agent hereunder. Upon such appointment, the term "Agent" shall for all
purposes of this Agreement thereafter mean such successor.
8.9 Collateral for Benefit of the Banks; Application of Funds.
Agent and, to the extent any Bank receives the same, Banks shall hold all
Liens upon the Collateral, and any and all proceeds realized therefrom, for
the pro rata benefit of Banks in accordance with each Bank's pro rata share
of the Revolving Credit Facility Commitment. While any Loans or Letters of
Credit are outstanding hereunder or any portion of the Revolving Credit
Facility Commitment exists under the terms of this Agreement, should any Bank
receive (whether by voluntary payment for the Loans, realization upon the
Collateral, exercise of offset or banker's lien, counter-claim, cross-action,
or otherwise) any sums from Borrower received on account of principal,
interest, or other amount owed under this Agreement, any guarantor of the
Loans, or any Subsidiary of Borrower, the sums so obtained shall be received
for the benefit of Banks in accordance with each Bank's pro rata share of the
Revolving Credit Facility Commitment. If any right of offset is exercised by
any Bank, the entire amount of such offset shall be applied to the Loans made
pursuant to this Agreement until paid in full, prior to application to any
other Debt of Borrower, any guarantor of the Loans or any Subsidiary of
Borrower owing to such Bank.
ARTICLE 9.
BANKS' REPRESENTATIONS
9.1 Investment Representation. Each Bank hereby represents that
it will acquire its Notes for its own account, for investment, and not with a
view to the distribution or sale of any such Note; provided, however, that
the disposition of any Note held by such Bank shall at all times be within
such Bank's exclusive control subject to Section 9.2 hereof. Each Bank's
acquisition of any Note shall constitute its reaffirmation of the foregoing
representation as of the date of such acquisition.
9.2 Participation in Notes; Compliance with Law. The provisions
of Section 9.1 hereof to the contrary notwithstanding, each Bank shall have
the right at any time and from time to time to do either or both of the
following without notice to any Person: (a) furnish one or more purchasers or
potential purchasers of all or any portion of the Loans or the Notes or of a
participation interest therein, with any and all information concerning
Borrower or its Subsidiaries that has been supplied by Borrower to Agent or
any Bank or obtained by other means by Agent or any Bank; or (b) to sell,
a s sign, pledge, hypothecate, syndicate, transfer, negotiate or grant
participations in all or any portion of such Bank's interests in the Loans or
the Notes in accordance with the terms and conditions of Section 11.5 hereof.
9.3 Confidentiality. Each Bank agrees that material, non-public
information regarding Borrower, its Subsidiaries, operations, Assets, and
existing and contemplated business plans shall be treated by such Bank in a
confidential manner, and shall not be disclosed by it to entities or Persons
who are not parties to this Agreement, except: (a) to counsel for and other
advisors, accountants, and auditors to such Bank; (b) as may be required by
statute, decision, or judicial or administrative order, rule, or regulation;
(c) as may be agreed to in advance by Borrower; (d) as to any such
information that is or becomes generally available to the public; and (e) in
connection with any assignment, prospective assignment, sale, prospective
sale, participation or prospective participation, or pledge or prospective
pledge of a Bank's interests hereunder, provided that any such assignee,
p r o s pective assignee, purchaser, prospective purchaser, participant,
prospective participant, pledgee, or prospective pledgee shall have agreed in
writing to take its interest hereunder subject to the terms hereof, including
those of this Section 9.3, or shall have entered into a confidentiality
agreement with Borrower or for the benefit of Borrower substantiality upon
the terms of this Section 9.3.
ARTICLE 10.
EXPENSES AND INDEMNITIES
10.1 E x p e n ses. Irrespective of whether the transactions
contemplated hereby are consummated, Borrower agrees to pay on demand:
(a) all of Agent's actual and reasonable out-of-pocket costs and expenses of
preparation of this Agreement, the Notes, the Loan Documents, and all other
agreements, instruments, and documents contemplated hereby and thereby;
(b) the cost of delivering the Notes to Banks pursuant to the provisions of
this Agreement; (c) the reasonable fees, expenses, and disbursements of
counsel (including in-house counsel to Agent) to Agent in connection with the
negotiation, preparation, printing, reproduction, execution, delivery, and
administration of this Agreement, the Notes, the Loan Documents, and all
other agreements, instruments, and documents contemplated hereby and thereby,
and any amendments and waivers hereto or thereto; (d) filing, recording,
publication, search, and title fees paid or incurred by or on behalf of Agent
or Banks in connection with the transactions contemplated by this Agreement,
the Notes, and the Loan Documents; (e) the reasonable costs and expenses
i n curred by Agent, on behalf of Banks, in connection with audits,
inspections, and appraisals contemplated by this Agreement, the Notes, and
the Loan Documents; (f) all other actual and reasonable out-of-pocket
expenses incurred by Agent in connection with the negotiation, preparation,
and execution of this Agreement, the Notes, the Loan Documents, and all other
agreements, instruments, and documents contemplated hereby and thereby, and
the making of the Loans and the issuance of the Letters of Credit hereunder;
and (g) all costs and expenses (including reasonable attorneys fees
(including reasonable allocated costs of in-house counsel of Banks) and costs
of settlement) incurred by Agent and each Bank in enforcing or collecting any
Debt of Borrower or defending the Loan Documents (including attorneys fees
and expenses incurred in connection with a "workout," a "restructuring," or
any bankruptcy or insolvency proceeding concerning Borrower or any of its
Subsidiaries), irrespective of whether suit is brought.
10.2 Indemnity. In addition to the payment of expenses pursuant to
S e c t ion 10.1 hereof, and irrespective of whether the transactions
contemplated hereby are consummated, Borrower agrees to indemnify, exonerate,
defend, pay, and hold harmless Banks, Agent, and any holder of any interest
in the Notes, and the officers, directors, employees, and agents of and
counsel to Banks, Agent, and such holders (collectively the "Indemnitees" and
individually as "Indemnitee") from and against any and all liabilities,
o b l igations, losses, damages, penalties, actions, causes of action,
judgments, suits, claims, costs, expenses, and disbursements of any kind or
nature whatsoever (including, the reasonable fees and disbursements of
counsel (including, the allocated costs of in-house counsel to Agent) for
such Indemnitees in connection with any investigation, administrative, or
judicial proceeding, whether such Indemnitee shall be designated a party
thereto), that may be imposed on, incurred by, or asserted against such
Indemnitee, in any manner relating to or arising out of the Revolving Credit
Facility Commitment, the use or intended use of the proceeds of the Loans or
Letters of Credit, or the consummation of the transactions contemplated by
this Agreement, including any matter relating to or arising out of the filing
or recordation of any of the Loan Documents which filing or recordation is
done based upon information supplied by Borrower to Agent and its counsel
(the "Indemnified Liabilities"); provided, however, that Borrower shall have
no obligation hereunder with respect to Indemnified Liabilities arising from
the gross negligence or willful misconduct of any such Indemnitee. Each
Indemnitee will promptly notify Borrower of each event of which it has
knowledge which may give rise to a claim under the indemnification provisions
of this Section 10.2. If any investigative, judicial, or administrative
proceeding arising from any of the foregoing is brought against any
Indemnitee indemnified or intended to be indemnified pursuant to this Section
10.2, Borrower, to the extent and in the manner directed by the Indemnitee or
intended Indemnitee, will resist and defend such action, suit, or proceeding
or cause the same to be resisted and defended by counsel designated by
Borrower (which counsel shall be reasonably satisfactory to the Indemnitee or
intended Indemnitee). Each Indemnitee will use its best efforts to cooperate
in the defense of any such action, writ, or proceeding. To the extent that
the undertaking to indemnify, pay, and hold harmless set forth in the
preceding sentence may be unenforceable because it is violative of any law or
public policy, Borrower shall make the maximum contribution to the payment
and satisfaction of each of the Indemnified Liabilities that is permissible
under applicable law. The obligations of Borrower under this Section 10.2
shall survive the termination of this Agreement and the discharge of
Borrower's other obligations hereunder.
ARTICLE 11.
MISCELLANEOUS
11.1 M o difications in Writing. No amendment, modification,
supplement, termination, or waiver of or to, or consent to any departure
from, any provision of this Agreement, the Notes, or the Loan Documents shall
in any event be effective unless the same shall be in writing and signed by
or on behalf of the Majority Banks (or Agent acting upon the written
instructions of the Majority Banks) and Borrower (or any of its Subsidiaries
to the extent a party to an affected Loan Document), to the extent a party
thereto; provided, however, that no amendment, modification, supplement,
termination, waiver, or consent, as the case may be, that has the effect of:
(a) reducing the rate or amount, or extending the stated maturity or due
date, of any sum payable by Borrower hereunder or under any of the Notes or
Loan Documents, including any Commitment Fee, Letter of Credit fee, or any
payment or prepayment of principal or interest; or (b) increasing the amount,
or extending the stated expiration or termination date, of any Bank's portion
of the Revolving Credit Facility Commitment hereunder; or (c) releasing all
or a material portion of the Collateral or guaranties (except to the extent
expressly provided herein or in any of the Loan Documents) supporting the
Loans hereunder; or (d) changing this Section 11.1 or Section 11.5 hereof or
the definitions of the terms "Revolving Credit Facility Commitment," or
"Majority Banks," shall be effective unless the same shall be signed by or on
behalf of all Banks; provided further, however, that no such amendment,
modification, supplement, termination, waiver, or consent, as the case may
be, that has the effect of changing any provision of this Agreement requiring
the consent of Agent or some specified percentage of Banks shall be effective
unless the same shall be signed by or on behalf of Agent or such specified
percentage of Banks, as the case may be; provided further, however, that no
such amendment, modification, supplement, termination, waiver, or consent, as
the case may be, that has the effect of (aa) increasing the duties or
obligations of Agent or an Issuing Bank hereunder; or (bb) increasing the
standard of care or performance required on the part of the Agent or an
Issuing Bank hereunder; or (cc) reducing or eliminating the indemnities or
immunities to which Agent or an Issuing Bank is entitled hereunder (including
any amendment or modification of this Section 11.1), shall be effective
unless the same shall be signed by or on behalf of Agent or an Issuing Bank,
as applicable. Any waiver of any provision of this Agreement, the Notes, or
the Loan Documents, and any consent to any departure by Borrower or any of
its Subsidiaries from the terms of any provisions of this Agreement, the
Notes, or the Loan Documents shall be effective only in the specific instance
and for the specific purpose for which given. No notice to or demand on
Borrower in any case shall entitle Borrower to any other or further notice or
demand in similar or other circumstances. Any amendment, modification,
supplement, termination, waiver, or consent effected in accordance with this
Section 11.1 shall be binding upon each holder of a Note and Borrower (or any
of its Subsidiaries to the extent a party to an affected Loan Document).
11.2 Waivers; Failure or Delay. No failure or delay on the part of
Banks, Agent, or any holder of any Note in the exercise of any power, right,
remedy, or privilege under this Agreement, the Notes, or the Loan Documents
shall impair such power, right, remedy, or privilege or shall operate as a
waiver thereof; nor shall any single or partial exercise of any such power,
right, or privilege preclude any other or further exercise of any other
power, right, or privilege. The waiver of any such right, power, or remedy
with respect to particular facts and circumstances shall not be deemed to be
a waiver with respect to other facts and circumstances. The remedies
provided for under this Agreement, in the Notes, and in the Loan Documents
are cumulative and are not exclusive of any remedies that may be available to
Agent or any Bank at law, in equity, or otherwise.
11.3 Notices, etc. Except to the extent provided in Sections 2.8
and 2.9 hereof, all notices, demands, instructions, and other communications
required or permitted to be given to or made upon any party hereto shall be
in writing and (except for financial statements and other information to be
furnished pursuant hereto (but not inclusive of any notices required to be
provided pursuant hereto) that may be sent by first-class mail, postage
prepaid) shall be personally delivered or sent by registered or certified
mail, postage prepaid, return receipt requested, or by prepaid telex, TWX,
telecopy, or telegram (with messenger delivery specified) and shall be deemed
to be given for purposes of this Agreement on the day that such writing is
received by the Person to whom it is to be sent pursuant to the provisions of
this Agreement. Unless otherwise specified in a notice sent or delivered in
accordance with the foregoing provisions of this Section 11.3, notices,
demands, instructions, and other communications in writing shall be given to
or made upon the respective parties hereto at their respective addresses (or
to their respective telex, TWX, or telecopier numbers) indicated on Schedule
11.3 attached hereto.
11.4 Confirmations. Borrower and each holder of a Note agree that,
upon written request received from time to time by one from another, each
will confirm to the other in writing (with a copy of each such confirmation
sent to the Agent) the aggregate unpaid principal amount of the Loans or
Letters of Credit then outstanding under any Note. Each holder of a Note
agrees that, upon written request received from time to time by it from
Borrower, to make any Note held by it (including any schedule attached
thereto) available for reasonable inspection by Borrower at the office of
such holder.
11.5 Benefit of Agreement. (a) This Agreement and any amendments
hereto shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors and assigns and no
other Person is intended to be a beneficiary hereof; provided, however, that
Borrower may not assign or transfer any interest hereunder without the prior
written consent of all Banks and, provided further, that, although any Bank
may grant participations in its rights hereunder, (i) such Bank shall remain
a "Bank" for all purposes hereunder and the participant shall not constitute
a "Bank" hereunder, (ii) any such grant of a participation shall not require
Borrower to file a registration statement with the SEC or qualify the Loans
or the Notes under the blue sky laws of any state, (iii) such Bank, together
with its Affiliates, shall continue at all times to hold beneficial interests
in Loans and such Bank's portion of the Revolving Credit Facility Commitment
having an aggregate principal amount of not less than an amount equal to:
(y) twenty percent (20%) (or such lesser percentage as may be approved by
Borrower and Agent) multiplied by (z) that Bank's pro rata share of the
Revolving Credit Facility Commitment in effect at the time it first acquired
its interests hereunder; provided, however, that such Bank's obligation shall
be proportionately reduced to the extent that Borrower elects to reduce the
Revolving Credit Facility Commitment pursuant to Section 2.12 hereof, (iv) no
Bank shall grant any participation (other than to an Affiliate of such Bank)
under which the participant shall have rights to approve any amendment to or
waiver of this Agreement or of any other agreement, instrument, or document
executed in connection herewith, except to the extent such amendment to or
waiver of this Agreement or of any other agreement, instrument, or document
executed in connection herewith would (aa) extend the final maturity date of
the Loans hereunder in which such participant is participating; (bb) reduce
the interest rate applicable to Loans hereunder in which such participant is
participating; (cc) release all or a material portion of the Collateral or
guaranties (except to the extent expressly provided herein or in any of the
Loan Documents) supporting the Loans hereunder in which such participant is
participating; (dd) postpone the payment of interest or the Commitment Fee or
Letter of Credit Fee or reduce the amount of the Commitment Fee or Letter of
Credit fee payable to such participant; (ee) change the amount or due dates
of scheduled principal repayments or prepayments; and (v) no Bank shall grant
any participation (other than to an Affiliate of such Bank) unless either
(xx) such participation is in an amount equal to or greater than Ten Million
Dollars ($10,000,000), or (yy) the provisions of clause (iv) of this Section
11.5 to the contrary notwithstanding, such participation is granted upon
terms under which the participant shall have no rights to approve any
amendment or waiver of any provision hereof or of any other agreement,
instrument, or document executed in connection herewith. In the case of any
participation, the participant shall not have any rights under this Agreement
or any of the other documents entered into in connection herewith (the
participant's rights against such Bank in respect of such participation to be
those set forth in the agreement executed by such Bank in favor of the
participant relating thereto) and all amounts payable to any Bank hereunder
shall be determined as if such Bank had not sold such participation.
(b) The foregoing notwithstanding and subject to paragraph (d) of
this Section 11.5, any Bank may assign a portion of its rights and
obligations hereunder to (i) one or more Banks upon the consent of Borrower,
which consent will not be unreasonably withheld, or (ii) with the prior
written consent of Borrower and Agent, which consent will not be unreasonably
withheld, to one or more commercial banks, insurance companies, savings and
loan associations, savings banks, other financial institutions, pension fund,
or mutual fund, each of which assignees shall become a party to this
Agreement as a "Bank" after the Closing Date by the execution and delivery of
an Assignment and Assumption Agreement with the assigning Bank, Borrower, and
Agent; provided, however, that (v) each such assignment shall be an amount of
not less than Ten Million Dollars ($10,000,000) and shall be for a pro-rated
portion of the Revolving Credit Facility Commitment, (w) Agent shall have
received an assignment processing fee of $3,000 payable by such assignee,
(x) any such assignment shall not require Borrower to file a registration
statement with the SEC or qualify the Loans or the Notes under the blue sky
laws of any state, (y) at such time Schedule R-2 shall be modified to reflect
the pro rata share of the Revolving Credit Facility Commitment of such new
Bank and of the pre-existing Banks, and (z) new Notes will be issued, against
delivery of the Notes being replaced thereby, to such new Bank and to the
assigning Bank in conformity with the requirements of Article 2 to the extent
needed to reflect their revised pro rata share of the Revolving Credit
Facility Commitment. To the extent of any assignment pursuant to this
Section 11.5, the assigning Bank shall be relieved of its obligations
hereunder with respect to its assigned portion of the Revolving Credit
Facility Commitment.
(c) In the event that the Federal Deposit Insurance
Corporation or its successor assumes control of any Bank, as receiver,
Borrower shall be permitted to select a financial institution to assume the
Revolving Credit Facility Commitment of such Bank, subject to the approval of
Agent, which approval shall not be unreasonably withheld.
(d) In addition to the assignments and participations
permitted under subsections (a) and (b) of this Section 11.5, any Bank may
assign, as collateral or otherwise, any of its rights (including rights to
payments of principal of or interest on the Notes) under any Loan Document to
any Federal Reserve Bank without notice to or consent of the Borrower or the
Agent; provided, however, that no such assignment under this subsection (d)
shall release the assigning Bank from its obligations hereunder.
11.6 Availability of Funds. Unless Agent shall have been notified
by a Bank prior to the date upon which any Loan is to be made that such Bank
does not intend to make available to Agent such Bank's portion of such Loan,
Agent may assume that such Bank has made or will make such proceeds available
to Agent on such date and Agent may, in reliance upon such assumption (but
shall not be required to), make available to Borrower a corresponding amount.
If such corresponding amount is not in fact made available to Agent by such
Bank, Agent shall be entitled to recover such amount on demand from such Bank
(or, if such Bank fails to pay such amount forthwith upon such demand, from
Borrower) together with interest thereon from such Bank in respect of each
day during the period commencing on the date such amount was made available
to such Borrower and ending on the date Agent recovers such amount, at a
rate, per annum, equal to the customary rate set by Agent for the correction
of errors among banks for the first three (3) Domestic Business Days and,
thereafter, the applicable interest rate in respect of such Loan. The
provisions of this Section 11.6 are solely for the benefit of Agent and Banks
and their successors and assigns and are not intended to benefit Borrower,
its Subsidiaries, its successors and assigns, or any other Person.
11.7 Headings. Article and Section headings used in this Agreement
and the table of contents preceding this Agreement are for convenience of
reference only and shall not constitute a part of this Agreement for any
purpose or affect the construction of this Agreement.
11.8 Execution in Counterparts; Telefacsimile Execution. This
Agreement may be executed in any number of counterparts and by different
parties on separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same
Agreement. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto. Delivery of an executed
counterpart of the signature pages of this Agreement by telecopier shall be
equally effective as delivery of a manually executed counterpart. Any party
delivering an executed counterpart of the signature pages of this Agreement
by telecopier shall thereafter also promptly deliver a manually executed
counterpart , but the failure to deliver such manually executed counterpart
shall not affect the validity, enforceability, and binding effect of this
Agreement.
11.9 GOVERNING LAW. EXCEPT AS SPECIFICALLY SET FORTH IN ANY LOAN
DOCUMENT: (A) THIS AGREEMENT, THE NOTES, AND THE LOAN DOCUMENTS SHALL BE
DEEMED TO HAVE BEEN MADE IN THE STATE OF CALIFORNIA; AND (B) THE VALIDITY OF
THIS AGREEMENT, THE NOTES, AND THE LOAN DOCUMENTS, THE CONSTRUCTION,
INTERPRETATION, AND ENFORCEABILITY THEREOF, AND THE RIGHTS OF THE PARTIES
THERETO WITH RESPECT TO ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION
THEREWITH, SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
11.10 JURISDICTION AND VENUE. TO THE EXTENT PERMITTED BY LAW, THE
PARTIES HERETO AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION
WITH THIS AGREEMENT, THE NOTES, OR THE LOAN DOCUMENTS SHALL BE TRIED AND
LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING
SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.
BORROWER, BANKS, AND AGENT, TO THE EXTENT THEY MAY LEGALLY DO SO, WAIVE ANY
RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO
OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH
THIS SECTION 11.10 AND STIPULATE THAT THE STATE AND FEDERAL COURTS LOCATED IN
THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA SHALL HAVE IN PERSONAM
JURISDICTION AND VENUE OVER SUCH PARTY FOR THE PURPOSE OF LITIGATING ANY SUCH
DISPUTE, CONTROVERSY, OR PROCEEDING ARISING OUT OF RELATED TO THIS AGREEMENT,
THE NOTES, OR THE LOAN DOCUMENTS. TO THE EXTENT PERMITTED BY LAW, SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST BORROWER
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SCHEDULE 11.3 HERETO. TO THE EXTENT IT MAY LEGALLY DO
SO, BORROWER AGREES THAT ANY FINAL JUDGMENT RENDERED AGAINST IT IN ANY ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AS TO THE SUBJECT OF SUCH FINAL JUDGMENT
AND MAY BE ENFORCED IN OTHER JURISDICTIONS IN ANY MANNER PROVIDED BY LAW.
11.11 WAIVER OF TRIAL BY JURY. BORROWER, BANKS, AND AGENT, TO THE
EXTENT THEY MAY LEGALLY DO SO, EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM, DEMAND, ACTION, CAUSE OF ACTION, OR PROCEEDING ARISING UNDER OR
WITH RESPECT TO THIS AGREEMENT, THE NOTES, OR THE LOAN DOCUMENTS, OR IN ANY
WAY CONNECTED WITH, OR RELATED TO, OR INCIDENTAL TO, THE DEALINGS OF THE
PARTIES HERETO WITH RESPECT TO THIS AGREEMENT, THE NOTES, THE LOAN DOCUMENTS,
OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND IRRESPECTIVE OF WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE. TO THE EXTENT THEY MAY LEGALLY DO SO,
BORROWER, BANKS, AND AGENT AGREE THAT ANY SUCH CLAIM, DEMAND, ACTION, CAUSE
OF ACTION, OR PROCEEDING SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND
THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION 11.11 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE OTHER
PARTY OR PARTIES HERETO TO THE WAIVER OF ITS OR THEIR RIGHT TO TRIAL BY JURY.
11.12 Severability of Provisions. Any provision of this Agreement
that is illegal, invalid, prohibited, or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
illegality, invalidity, prohibition, or unenforceability without invalidating
or impairing the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
11.13 Changes in Accounting Principles. (a) If any changes in
accounting principles from those used in the preparation of the financial
statements referred to in this Agreement are hereafter occasioned by the
promulgation of rules, regulations, pronouncements, or opinions of, or
required by, the Financial Accounting Standards Board or the American
Institute of Certified Public Accountants (or successors thereto or agencies
with similar functions), or there shall occur any change in Borrower's or any
of its Subsidiaries' fiscal or tax years and, as a result of any such
changes, there shall result a change in the method of calculating any of the
financial covenants, negative covenants, standards, or other terms or
conditions found in this Agreement, or (b) if Borrower, for reasonable
business purposes, shall desire to change such accounting principles or the
application thereof (which change shall be consistent with accounting
principles then in effect pursuant to rules, regulations, pronouncements, or
opinions of the Financial Accounting Standards Board or the American
Institute of Certified Public Accountants) and such desired change would
result in a change in the method of calculating any of the financial
covenants, negative covenants, standards, or other terms and conditions found
in this Agreement, then the parties hereto agree to enter into negotiations
in order to amend such provisions and the definition of "GAAP" set forth in
Section 1.1 so as to equitably reflect such changes with the desired result
that the criteria for evaluating the financial condition of Borrower and its
Subsidiaries shall be the same after such changes as if such changes had not
been made.
11.14 Survival of Agreements, Representations and Warranties. All
agreements, representations, and warranties made herein shall survive the
execution and delivery of this Agreement, the making of the Loans hereunder,
and the execution and delivery of the Notes.
11.15 Setoff. In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, upon
the occurrence and during the continuation of any Event of Default, each Bank
and each holder or transferee of any Note or any Person with any interest in
any Note is hereby authorized by Borrower at any time or from time to time,
without notice to Borrower or to any other Person, any such notice being
hereby expressly waived, to offset and to appropriate and to apply any and
all deposits (general or special, time or demand, including indebtedness
evidenced by certificates of deposit, whether matured or unmatured, but not
including trust accounts) and any other indebtedness at any time held or
owing by that Bank or that subsequent holder to or for the credit or the
account of Borrower against and on account of the Debt of Borrower to that
Bank or that subsequent holder under this Agreement and the Notes, including
all claims of any nature of description arising out of or connected with this
Agreement, the Notes, or the Loan Documents, irrespective of whether that
Bank or that subsequent holder shall have made any demand under this
Agreement; provided, however, that Banks and the holder or transferee of any
Note or any Person with any interest in any Note expressly agree to refrain
from exercising such rights unless authorized to do so in writing by the
Majority Banks. After the exercise by any Bank or any holder or transferee
of any Note or any Person with any interest in any Note of any right of
offset against deposit accounts of Borrower maintained with that Bank or that
subsequent holder, that Bank or that subsequent holder shall give Borrower
written notice thereof, but without liability for the failure to do so, and
no such failure of notice shall affect the validity of such offset.
11.16 Independence of Covenants. All covenants under this
Agreement shall each be given independent effect so that if a particular
action or condition is not permitted by any such covenant, the fact that it
would be permitted by another covenant, by an exception thereto, or would
otherwise be within the limitations thereof, shall not avoid the occurrence
of an Event of Default or Unmatured Event of Default if such action is taken
or condition exists.
11.17 Complete Agreement. This Agreement, together with the
exhibits and schedules to this Agreement, the Disclosure Statement, the
Notes, and the Loan Documents is intended by the parties as a final
expression of their agreement and is intended as a complete statement of the
terms and conditions of their agreement, reflects the entire understanding of
the parties with respect to the transactions contemplated hereby, and shall
not be contradicted or qualified by any other agreement, oral or written.
The foregoing and anything else contained in this Agreement, the Notes, or
the Loan Documents to the contrary notwithstanding, any term or provision of
the 1993 Credit Agreement that, by the terms thereof, is intended to survive
the termination of the 1993 Credit Agreement shall continue in full force and
effect.
11.18 Revival and Reinstatement of Obligations. If the incurrence
or payment of any amount due hereunder or under the Notes or the Loan
Documents by Borrower or any of its Subsidiaries or the transfer by Borrower
or any such Subsidiaries to Agent, on behalf of Banks, of any Assets of
Borrower or such Subsidiaries, as applicable, should for any reason
subsequently be declared to be void or voidable under any state or federal
law relating to creditors' rights, including provisions of the Bankruptcy
Code relating to fraudulent conveyances, preferences, and other voidable or
recoverable payments of money or transfers of property (collectively, a
"Voidable Transfer"), and if Agent or the Banks are required to repay or
restore, in whole or in part, any such Voidable Transfer, or elect to do so
upon the reasonable advice of their counsel, then, as to any such Voidable
Transfer, or the amount thereof that Agent or the Banks, as applicable, are
required or elect to repay or restore, and as to all reasonable costs,
expenses, and attorneys fees of Agent and the Banks related thereto, the
liability of Borrower or such Subsidiary automatically shall be revived,
reinstated, and restored and shall exist as though such Voidable Transfer
never had been made.
11.19 Ancillary Documents. Any and all references in the
Ancillary Documents to the "Facility A Commitment" hereby are deemed to mean
and refer to the Revolving Credit Facility Commitment as defined herein.
Furthermore, as set forth in Section 4 of the Security Agreement and
Section 4 of the Mojave Security Agreement, various amounts pertaining to
adjustment of and payments under insurance and reductions in the Revolving
Credit Facility Commitment have been increased from the amounts set forth in
the security documents in effect in connection with the 1993 Credit
Agreement. The corresponding amounts set forth in any insurance provisions
in any other Ancillary Document or any other document are hereby deemed to be
similarly increased to be the same as the amounts set forth in Section 4 of
the Security Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed and delivered as of the date first hereinabove set forth.
SOUTHDOWN, INC.,
a Louisiana corporation
By____________________________
Title:______________________
▇▇▇▇▇ FARGO BANK, N.A.,
a national banking association,
in its individual capacity and
as Agent
By____________________________
Title:______________________
SOCIETE GENERALE, SOUTHWEST
AGENCY
By____________________________
Title:______________________
CREDIT SUISSE
By____________________________
Title:______________________
By____________________________
Title:______________________
CAISSE NATIONALE DE CREDIT
AGRICOLE
By____________________________
Title:______________________
BANQUE PARIBAS
By____________________________
Title:______________________
By____________________________
Title:______________________
CIBC INC.
By____________________________
Title:______________________
THE BANK OF NOVA SCOTIA
By____________________________
Title:______________________
THE FIRST NATIONAL BANK OF
BOSTON
By____________________________
Title:______________________
NOTICE INFORMATION
Southdown, Inc.: Southdown, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Executive Vice President-
Finance and Chief Financial
Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
Southdown, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of notices ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P.
to Southdown, Inc. to: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Agent: ▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of notices ▇▇▇▇▇ Fargo Corporate Services,
to Agent to: Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of notices ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
to Agent to: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇ Hilson, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Societe Generale, Societe Generale, Southwest
Agency
Southwest Agency: ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Ms. Tequlla English
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
Societe Generale, Southwest
Agency
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Banque Paribas: Banque Paribas
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The First National Bank The First National Bank of Boston
of Boston: Environmental Services Division
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Stop 01-08-05
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Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
CIBC, Inc.: Canadian Imperial Bank of Commerce,
Inc.
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
Canadian Imperial Bank of Commerce,
Inc.
2 Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Caisse Nationale ▇▇ ▇▇▇▇▇▇ Nationale de Credit Agricole
Credit Agricole: ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
Caisse Nationale de Credit Agricole
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Credit Suisse Credit Suisse
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Ms. ▇▇▇▇ Asa
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
Credit Suisse
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The Bank of Nova Scotia The Bank of Nova Scotia
Atlanta Agency
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and with a separate notice to:
The Bank of Nova Scotia
Houston Representative ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
TABLE OF CONTENTS
RECITALS 1
ARTICLE 1. DEFINITIONS AND ACCOUNTING TERMS 2
1.1 Definitions 2
1.2 Construction 34
1.3 Accounting Terms 35
1.4 Disclosure Statement, Exhibits, Schedules 35
ARTICLE 2. AMOUNT AND TERMS OF LOANS 35
2.1 Revolving Credit Facility 35
(a) Revolving Credit Facility Loans 35
(b) Revolving Credit Facility Letters of Credit 36
(c) MARAD 36
2.2 Letters of Credit 37
2.3 Authorization and Issuance of Notes 39
2.4 Rate Designation 40
2.5 Interest Rates; Payment of Principal and Interest 40
2.6 Overdue Rates 42
2.7 Computation of Interest and Fees 43
2.8 Notice of Borrowing Requirements 43
2.9 Conversion or Continuation 44
2.10 Loans by Banks 45
2.11 Mandatory Repayment 46
2.12 Voluntary Prepayments or Reductions of
Revolving Credit Facility Commitment 47
2.13 Commitment Fee 47
2.14 Agent's Fees 48
2.15 Increased Costs 48
2.16 Illegality 49
2.17 Taxes 49
2.18 Lending Offices 51
2.19 Funding Sources 51
2.20 Holidays 52
2.21 Place of Borrowings 52
2.22 Time and Place of Payments 52
2.23 Increased Risk-Based Capital Cost 52
2.24 Survivability 53
2.25 Interest and Fees 53
ARTICLE 3. CONDITIONS TO LOANS 53
3.1 Conditions Precedent to Initial Loans
and Letters of Credit 53
3.2 Conditions Concurrent to Initial Loans
and Letters of Credit 56
3.3 Conditions Precedent to All Loans 57
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF BORROWER 57
4.1 Organization, Powers, Good Standing,
and Subsidiaries 58
(a) Organization and Powers 58
(b) Good Standing 58
(c) Subsidiaries 58
4.2 Authorization of Borrowing, etc. 58
(a) Authorization of Borrowing 58
(b) Authorization of Subsidiaries' Loan Documents 59
(c) No Conflict - Borrower 59
(d) No Conflict - Mojave 59
(e) Governmental Consents 59
(f) Binding Obligations 59
(g) Lien Priority 60
4.3 Financial Condition 60
4.4 Changes 60
4.5 Title to Properties; Liens; Properties 60
4.6 Litigation; Adverse Facts 61
4.7 Payment of Taxes 61
4.8 Materially Adverse Agreements; Performance 62
(a) Agreements 62
(b) Performance 62
4.9 Governmental Regulation 62
4.10 Securities Activities 62
4.11 Employee Benefit Plans 62
4.12 Disclosure 63
4.13 Debt 64
4.14 Trademarks, etc. 64
4.15 Existing Defaults 64
4.16 Leases 65
4.17 Burdensome Agreements, etc. 65
4.18 Fire, Explosion, and Labor Disputes 65
4.19 Location of Assets and Chief Executive Offices 65
4.20 Environmental Condition 65
4.21 No Default 67
4.22 Parties Intended to be Benefitted 67
ARTICLE 5. AFFIRMATIVE COVENANTS OF BORROWER 67
5.1 Accounting Records 67
5.2 Financial Statements and Notices 67
5.3 Corporate Existence, etc. 71
5.4 Payment of Taxes and Claims 72
5.5 Maintenance of Properties 72
5.6 Insurance 72
5.7 Inspection 73
5.8 Compliance with Laws, etc. 73
5.9 Environmental Compliance and Reporting 73
(a) Environmental Laws 73
(b) Indemnification 73
(c) Remedial Action 74
(d) Reporting 74
(e) Best Efforts To Avoid Contamination 74
5.10 Compliance with ERISA 74
5.11 Further Assurances 75
5.12 Subordinated Debt 75
5.13 Appraisals 75
ARTICLE 6. NEGATIVE COVENANTS OF BORROWER 75
6.1 Debt 76
6.2 Liens 77
6.3 Investments 77
6.4 Contingent Obligations 79
6.5 Preferred Stock 79
6.6 Financial Covenants 80
(a) Leverage Ratio 80
(b) Consolidated Tangible Net Worth 80
(c) Minimum Current Ratio 80
(d) Free Cash Flow Ratio 81
6.7 Restriction on Fundamental Changes 81
6.8 Sales and Lease-Backs 82
6.9 Sale of Assets 82
6.10 Transactions with Shareholders and Affiliates 83
6.11 Conduct of Business 84
6.12 Amendments or Waivers of Certain Documents 84
6.13 Use of Proceeds 84
6.14 ERISA 84
6.15 Misrepresentations 85
6.16 Change in Location of Chief Executive Offices
and Assets 85
6.17 Restrictive Agreements 86
6.18 Margin Regulation 86
6.19 Subordinated Debt, Preferred Stock, and Borrower
Common Stock 86
6.20 Hedge Agreements 86
6.21 Dividends 87
ARTICLE 7. EVENTS OF DEFAULT 88
7.1 Events of Default 88
(a) Failure to Make Payments When Due 88
(b) Default in Other Agreements 88
(c) Breach of Certain Covenants 89
(d) Breach of Warranty 89
(e) Other Defaults Under Agreement 90
(f) Default Under Loan Documents, etc. 90
(g) Involuntary Bankruptcy; Appointment of
Receiver, etc. 90
(h) Voluntary Bankruptcy; Appointment of
Receiver, etc. 91
(i) Judgments and Attachments 92
(j) Dissolution 92
(k) ERISA Liabilities 92
(l) Termination of Loan Documents 93
(m) Subordination Default 93
(n) Change of Control 94
7.2 Remedies 94
ARTICLE 8. THE AGENT AND THE BANKS 95
8.1 Appointment and Powers of Agent 95
8.2 Nature of Duties; Independent Credit Investigation 96
8.3 Actions in Discretion of Agent; Instructions from
Banks 97
8.4 Exculpatory Provisions 97
8.5 Reliance by Agent 98
8.6 Excess Payments 98
8.7 Obligations Several 98
8.8 Resignation by Agent 98
8.9 Collateral for Benefit of the Banks;
Application of Funds 99
ARTICLE 9. BANKS' REPRESENTATIONS 99
9.1 Investment Representation 99
9.2 Participation in Notes; Compliance with Law 99
9.3 Confidentiality 100
ARTICLE 10. EXPENSES AND INDEMNITIES 100
10.1 Expenses 100
10.2 Indemnity 101
ARTICLE 11. MISCELLANEOUS 102
11.1 Modifications in Writing 102
11.2 Waivers; Failure or Delay 103
11.3 Notices, etc 103
11.4 Confirmations 103
11.5 Benefit of Agreement 103
11.6 Availability of Funds 105
11.7 Headings 106
11.8 Execution in Counterparts 106
11.9 GOVERNING LAW 106
11.10 JURISDICTION AND VENUE 106
11.11 WAIVER OF TRIAL BY JURY 107
11.12 Severability of Provisions 108
11.13 Changes in Accounting Principles 108
11.14 Survival of Agreements, Representations
and Warranties 108
11.15 Setoff 108
11.16 Independence of Covenants 109
11.17 Complete Agreement 109
11.18 Revival and Reinstatement of Obligations 109
11.19 Ancillary Documents 110
EXHIBITS AND SCHEDULES
Exhibit A-1 Form of Assignment and Assumption Agreement
Exhibit C-1 Form of Collateral Release Agreement
Exhibit M-1 Form of Mojave Guaranty
Exhibit M-2 Form of Mojave Security Agreement
Exhibit N-1 Form of Note
Exhibit N-2 Form of Notice of Borrowing
Exhibit N-3 Form of Notice of Conversion/Continuation
Exhibit S-1 Form of Security Agreement
Exhibit S-2 Form of Stock Pledge
Exhibit 3.1(k) Form of Officer's Compliance Certificate
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Schedule L-1 Letters of Credit outstanding on the Closing Date
Schedule R-2 Revolving Credit Facility Commitment
Schedule S-1 Specified Subsidiaries
Schedule 11.3 Notice Information