EXHIBIT 4.6
Execution Counterpart
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COMPANIA VIDRIERA, S.A. DE C.V.,
as Borrower
-----------------------------
$235,000,000
LOAN AGREEMENT
Dated as of August 14, 2001
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CERTAIN LENDERS
HSBC SECURITIES (USA) INC.
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.,
as Joint Lead Arrangers,
HSBC INVESTMENT BANK PLC,
as Administrative Agent
HSBC BANK USA,
as Collateral and Paying Agent
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only. Page
Page
SECTION 1. DEFINITIONS................................................ 1
1.01 Certain Defined Terms................................... 1
SECTION 2. COMMITMENTS, ETC........................................... 15
2.01 Loans................................................... 15
2.02 Borrowing............................................... 16
2.03 Fees.................................................... 16
2.04 Several Obligations; Certain Remedies Independent....... 16
2.05 Notes................................................... 17
SECTION 3. PAYMENTS OF PRINCIPAL AND INTEREST......................... 17
3.01 Repayment of Loans...................................... 17
3.02 Interest................................................ 17
3.03 Optional Prepayments.................................... 17
3.04 Mandatory Prepayments................................... 18
SECTION 4. PAYMENTS, ETC.............................................. 19
4.01 Payments................................................ 19
4.03 Computations............................................ 19
4.04 Certain Notices......................................... 19
4.05 Non-Receipt of Funds by the Administrative Agent........ 20
4.06 Sharing of Payments..................................... 20
SECTION 5. YIELD PROTECTION, ETC...................................... 21
5.01 Additional Costs........................................ 21
5.02 Substitute Basis........................................ 23
5.03 Illegality.............................................. 23
5.04 Compensation............................................ 24
5.05 Taxes................................................... 24
SECTION 6. CONDITIONS PRECEDENT....................................... 27
6.01 Conditions to Effectiveness............................. 27
6.02 Additional Conditions to Borrowing...................... 28
Page
SECTION 7. GUARANTEE.................................................. 29
7.01 The Guarantee........................................... 29
7.02 Acknowledgments, Waivers and Consents................... 30
7.03 Reinstatement........................................... 33
7.04 Subrogation............................................. 33
7.05 Remedies................................................ 33
7.06 Payments................................................ 34
7.07 Rights of Contribution.................................. 34
7.08 General Limitation on Guarantee Obligations............. 34
SECTION 8. REPRESENTATIONS AND WARRANTIES............................. 35
8.01 Power and Authority..................................... 35
8.02 Due Authorization, Etc.................................. 35
8.03 Governmental and Other Approvals........................ 35
8.04 Legal Effect............................................ 35
8.05 Financial Statements.................................... 36
8.06 Ranking................................................. 36
8.07 No Actions or Proceedings............................... 36
8.08 Commercial Activity; Absence of Immunity................ 36
8.09 Taxes................................................... 36
8.10 Legal Form.............................................. 37
8.11 Full Disclosure......................................... 37
8.12 Liens................................................... 37
8.13 Solvency................................................ 37
8.14 Restrictions on Upstreaming............................. 38
8.15 Not an Investment Company............................... 38
8.16 Collateral.............................................. 38
SECTION 9. COVENANTS OF THE BORROWER.................................. 38
9.01 Corporate Existence, Etc................................ 38
9.02 Compliance with Law..................................... 38
9.03 Governmental Authorizations............................. 38
9.04 Financial Statements, Etc............................... 39
9.05 Ranking................................................. 40
9.06 Maintenance of Collection Account and Reserve Account... 40
9.07 Transactions With Affiliates............................ 40
9.08 Line of Business........................................ 40
9.09 Upstreaming............................................. 40
9.10 Hedge Agreements........................................ 41
9.11 Collections of Eligible Receivables..................... 41
9.12 Collateral.............................................. 41
9.13 Negative Pledge......................................... 41
9.14 Fiscal Year............................................. 41
9.15 Intercompany Notes...................................... 41
(ii)
Page
SECTION 10. COVENANTS OF THE GUARANTORS............................... 42
10.01 Corporate Existence, Etc............................... 42
10.02 Compliance with Law.................................... 42
10.03 Governmental Authorizations............................ 42
10.04 Financial Statements, Etc.............................. 43
10.05 Ranking................................................ 44
10.06 Dividend Payments...................................... 44
10.07 Use of Dividend Payments............................... 44
10.08 Consolidated Net Worth................................. 45
10.09 VENA Interest Coverage Ratio........................... 45
10.10 VENA Debt to EBITDA Ratio.............................. 46
10.11 Vitro Packaging Debt Service Coverage Ratio............ 46
10.12 Dispositions........................................... 46
10.13 Indebtedness........................................... 47
10.14 Guaranteed Indebtedness................................ 49
10.15 Negative Pledge........................................ 49
10.16 Transactions With Affiliates........................... 49
10.17 Line of Business....................................... 50
10.18 Vitro Packaging Operating Account...................... 50
SECTION 11. EVENTS OF DEFAULT......................................... 50
SECTION 12. THE ACCOUNTS.............................................. 53
12.01 The Collection Account and the Reserve Account......... 53
12.02 Permitted Investments.................................. 57
12.03 Certain Provisions Relating to Agents.................. 57
SECTION 13. THE AGENTS................................................ 58
13.01 Appointment, Powers and Immunities..................... 58
13.02 Reliance by Agents..................................... 59
13.03 Defaults............................................... 59
13.04 Rights as a Lender..................................... 60
13.05 Indemnification........................................ 60
13.06 Non-Reliance on Agents and Other Lenders............... 60
13.07 Failure to Act......................................... 61
13.08 Resignation or Removal of Agents....................... 61
SECTION 14. MISCELLANEOUS............................................. 62
14.01 Waiver................................................. 62
14.02 Notices................................................ 62
14.03 Expenses, Etc.......................................... 62
14.04 Amendments, Etc........................................ 63
14.05 Successors and Assigns................................. 63
(iii)
Page
14.06 Assignments and Participations......................... 63
14.07 Survival............................................... 65
14.08 Captions............................................... 66
14.09 Counterparts........................................... 66
14.10 Governing Law.......................................... 66
14.11 Jurisdiction, Service of Process and Venue............. 66
14.12 Waiver of Jury Trial................................... 67
14.13 Waiver of Immunity..................................... 67
14.14 Judgment Currency...................................... 67
14.15 Use of English Language................................ 68
14.16 Entire Agreement....................................... 68
14.17 Severability........................................... 68
14.18 Right of Set-off....................................... 68
14.19 Confidentiality........................................ 68
14.20 No Fiduciary Relationship.............................. 69
ANNEX 1 - Applicable Lending Office; Address for Notices; Commitments
SCHEDULE 1 - Existing Restrictions
SCHEDULE 2 - Litigation
SCHEDULE 3 - Subsidiaries
SCHEDULE 4 - Existing Liens
EXHIBIT A - Form of Note
EXHIBIT B-1 - Form of Vidriera Security Agreement
EXHIBIT B-2 - Form of Vitro Packaging Security Agreement
EXHIBIT C - Form of Account Control Agreement
EXHIBIT D - Form of Notice of Borrowing
EXHIBIT E - Form of Certificate as to Authority,
Incumbency and Signatures
EXHIBIT F - Form of Opinion of Mexican Counsel to the Borrower
and the Guarantors
EXHIBIT G - Form of Opinion of Special New York Counsel
to the Borrower and the Guarantors
EXHIBIT H - Form of Opinion of Special Mexican Counsel
to the Administrative Agent
EXHIBIT I - Form of Opinion of Special New York
Counsel to the Administrative Agent
EXHIBIT J - Form of Process Agent Acceptance
EXHIBIT K - Form of Notice of Assignment
EXHIBIT L - Form of Borrower Compliance Certificate
EXHIBIT M - Form of Vitro Packaging Compliance Certificate
EXHIBIT N - Form of VENA Compliance Certificate
EXHIBIT O - Form of Vitro Compliance Certificate
(iv)
LOAN AGREEMENT dated as of August 14, 2001, among:
(1) COMPANIA VIDRIERA, S.A. DE C.V. (the "Borrower"), a Mexican
corporation;
(2) VITRO, S.A. DE C.V. ("Vitro"), a Mexican corporation, VITRO PACKAGING,
INC. ("Vitro Packaging"), a Delaware corporation, and VITRO ENVASES
NORTEAMERICA, S.A. DE C.V. ("VENA"), a Mexican corporation;
(3) VIDRIERA GUADALAJARA, S.A. DE C.V., a Mexican corporation, VIDRIERA
MEXICALI, S.A. DE C.V, a Mexican corporation, VIDRIERA MEXICO, S.A. DE C.V, a
Mexican corporation, VIDRIERA MONTERREY, S.A. DE C.V, a Mexican corporation,
VIDRIERA QUERETARO, S.A. DE C.V, a Mexican corporation, VIDRIERA TOLUCA, S.A. DE
C.V, a Mexican corporation and VIDRIERA LOS ▇▇▇▇▇, ▇.▇. DE C.V, a Mexican
corporation (together, the "VENA Leasing Companies", and together with Vitro,
Vitro Packaging and VENA, the "Guarantors");
(4) each of the entities that is a signatory hereto under the caption
"LENDERS" on the signature pages hereto and each entity that becomes a "Lender"
after the date hereof pursuant to Section 14.06(b) hereof (individually, a
"Lender" and, collectively, the "Lenders");
(5) HSBC INVESTMENT BANK PLC, as administrative agent for the Lenders (in
such capacity, together with its successors in such capacity, the
"Administrative Agent"); and
(6) HSBC BANK USA, as collateral and paying agent for the Lenders (in such
capacity, together with its successors in such capacity, the "Collateral and
Paying Agent").
W I T N E S S E T H :
The Borrower has requested that the Lenders make term loans to it in
an aggregate principal amount up to but not exceeding $235,000,000, and the
Lenders are prepared to make such loans upon and subject to the terms and
conditions hereof. Accordingly, the parties hereto agree as follows:
SECTION 1. DEFINITIONS.
1.01 Certain Defined Terms. As used herein, the following terms shall
have the following meanings (all terms defined in this Section 1.01 or in other
provisions of this Agreement in the singular to have the same meanings when used
in the plural and vice versa):
"Accounts" shall mean, collectively, the Collection Account and the
Reserve Account.
"Account Control Agreement" shall mean an Account Control Agreement in
substantially the form of Exhibit C hereto among the Borrower, the Collateral
and Paying Agent and the Intermediary, as from time to time amended.
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"Administrative Agent" shall have the meaning set forth in the
introduction hereto.
"Administrative Agent's Account" shall mean the account of the
Administrative Agent as may be designated by the Administrative Agent to the
Borrower in writing.
"Affiliate" shall mean, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person or is a director or officer of such Person. For purposes of
this definition, the term "control" (including the terms "controlling",
"controlled by" and "under common control with") of a Person shall mean the
possession, direct or indirect, of the power to vote 25% or more of the Voting
Shares of such Person or to direct or cause the direction of the management and
policies of such Person, whether through the ownership of such Voting Shares, by
contract or otherwise.
"Affiliated Purchaser" shall have the meaning set forth in Section
3.04(b)(ii) hereof.
"Agents" shall mean, collectively, the Administrative Agent and the
Collateral and Paying Agent.
"Applicable Lending Office" shall mean, for each Lender, the "Lending
Office" of such Lender (or of an affiliate of such Lender) specified opposite
its name on Annex 1 hereto or such other office of such Lender (or of an
affiliate of such Lender) as such Lender may from time to time specify in
writing to the Administrative Agent and the Borrower as the office by which its
Loans are to be made and maintained.
"Applicable Margin" shall mean (a) from the Closing Date to and
including the fourth Principal Payment Date, 2.25% per annum and (b) thereafter,
the following rates per annum determined at any time on the basis of the VENA
Debt to EBITDA Ratio on the last day of the then most recently concluded fiscal
quarter of VENA:
VENA Debt to
EBITDA Ratio
VENA Debt to greater than
EBITDA Ratio 3.0 to 1.0 but VENA Debt to
equal to or equal to or EBITDA Ratio
less than 3.0 less than 3.5 greater than
to 1.0 to 1.0 3.5 to 1.0
-------------------- ----------------- ----------------- ------------------
Applicable Margin 1.75% 2.00% 2.25%
For purposes of computing the Applicable Margin, the VENA Debt to
EBITDA Ratio shall be determined on the basis of the financial statements of
VENA and its Consolidated Subsidiaries most recently delivered to the
Administrative Agent pursuant to Section 9.04(a) or
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(b) hereof, each change in the Applicable Margin based on a change in the VENA
Debt to EBITDA Ratio to take effect on the first day of the Interest Period that
next commences after delivery of such financial statements; provided, that for
any period during which VENA has failed to provide on a timely basis the
financial statements referred to in said Sections, and until they are so
furnished, the Applicable Margin shall be 2.25% per annum.
"Borrower" shall have the meaning set forth in the introduction
hereto.
"Borrower's Debt Service Coverage Ratio" shall mean, as of the last
day of any fiscal quarter of the Borrower, the ratio of (i) the aggregate amount
collected in respect of Eligible Receivables and credited to the Collection
Account during such fiscal quarter to (ii) the Debt Service Amount for the
immediately succeeding fiscal quarter of the Borrower.
"Borrowing" shall mean the borrowing by the Borrower under this
Agreement, consisting of the simultaneous making of Loans by the Lenders.
"Borrowing Date" shall mean the date of the Borrowing.
"Business Day" shall mean any day on which commercial banks are not
authorized or required to close in New York City, London and Mexico City and
that is also a day on which dealings in Dollar deposits are carried out in the
London interbank market.
"Capital Lease Obligations" shall mean, as to any Person, the
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) real and/or personal Property, which
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP and, for purposes of this
Agreement, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP.
"Change of Control" shall mean:
(i) any Person or two or more Persons acting in concert shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of
1934), directly or indirectly, of Voting Shares of Vitro (or other
securities convertible into such Voting Shares) representing the majority
of the combined voting power of all Voting Shares of Vitro; or
(ii) any Person or two or more Persons acting in concert shall have
acquired the power to exercise, directly or indirectly, effective control
for any purpose over Voting Shares of Vitro (or other securities
convertible into such Voting Shares) representing the majority of the
combined voting power of all Voting Shares of Vitro; or
(iii) during any period of 18 consecutive calendar months, a majority
of the Board of Directors of Vitro shall no longer be composed of
individuals who were members of such Board on the first day of such period;
or
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(iv) Vitro shall cease to own, directly or indirectly, beneficially
and of record, 100% of the Voting Shares of either Vitro Packaging or VENA,
or VENA shall cease to own, beneficially and of record, (x) 100% of the
Voting Shares of the Borrower, Industria del Alcali, S.A. de C.V. and
Fabricacion de Maquinas, S.A. de C.V or (y) at least 60% of the Voting
Shares of Vitro OCF, provided, that Vitro may make a Disposition for cash
of up to 9% of the total outstanding Voting Shares of Vitro OCF to a third
party (which is not an Affiliate of Vitro) on an arm's-length basis, so
long as the Net Proceeds of such Disposition (or, if applicable, the Dollar
equivalent thereof) are concurrently with the receipt thereof applied to
the prepayment of Loans hereunder to the extent required in accordance with
Section 3.04(b) hereof.
"Closing Date" shall mean the date on which the Administrative Agent
notifies the Borrower that the conditions precedent set forth in Section 6.01
hereof have been satisfied.
"Collateral" shall have the meaning set forth in each Security
Agreement.
"Collateral and Paying Agent" shall have the meaning set forth in the
introduction hereto.
"Collection Account" shall mean account no. 10-877325 established and
maintained at the principal office in New York, New York of the Intermediary for
the account of the Borrower, under the sole dominion and control of the
Collateral and Paying Agent and designated "Compania Vidriera, S.A. de C.V.
Collection Account", for which the Collateral and Paying Agent is the
"entitlement holder" within the meaning of Section 8-102(a)(7) of the UCC.
"Commitment" shall mean, as to each Lender, the obligation of such
Lender, on and subject to the terms and conditions of this Agreement, to make a
Loan to the Borrower in a principal amount up to but not exceeding the amount
specified opposite its name on Annex 1 hereto.
"Commitment Termination Date" shall mean the date five days after the
date hereof.
"Confidential Information" means information that the Borrower and/or
any Guarantor furnish to the Administrative Agent or the Collateral and Paying
Agent or any Lender, but does not include any such information that is or
becomes generally available to the public or that is or becomes available to the
Administrative Agent or the Collateral and Paying Agent or such Lender from a
source other than the Borrower or any Guarantor, as the case may be.
"Consolidated EBITDA" shall mean, for any Person and any period, with
respect to such Person and its consolidated Subsidiaries on a consolidated
basis, the sum (without duplication) of (i) Consolidated Operating Income and
(ii) depreciation and amortization.
"Consolidated Interest Expense" shall mean, with respect to any Person
for any period, the aggregate amount of interest accruing during such period on
Indebtedness of such Person and its consolidated Subsidiaries on a consolidated
basis, determined in accordance with
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GAAP, including the interest portion of payments under Capital Lease Obligations
and any capitalized interest and amortization of debt discount and expense.
"Consolidated Net Worth" shall mean, for any Person at any time, for
such Person and its consolidated Subsidiaries, total shareholders' equity,
determined in accordance with GAAP.
"Consolidated Operating Income" shall mean, for any Person and any
period, operating income of such Person and its consolidated Subsidiaries on a
consolidated basis, determined in accordance with GAAP.
"Consolidated Total Debt" shall mean, for any Person at any time, the
sum, with respect to such Person and its consolidated Subsidiaries on a
consolidated basis, of all Indebtedness of such Person and its Subsidiaries that
would appear on a consolidated balance sheet of such Person in accordance with
GAAP.
"Coverage Default" shall mean the occurrence of either of the
following:
(i) the failure by the Borrower as of the last day of each of two (2)
consecutive fiscal quarters of the Borrower to maintain a Borrower's Debt
Service Coverage Ratio of at least 1.50 to 1.00, or
(ii) the failure by the Borrower as of the last day of any one (1)
fiscal quarter of the Borrower to maintain a Borrower's Debt Service Coverage
Ratio of at least 1.25 to 1.00.
"Covered Taxes" shall mean all present and future taxes, duties,
levies, imposts, deductions, charges or withholdings whatsoever imposed with
respect to any amount payable on or in respect of this Agreement, any of the
other Loan Documents or the Loans, and all interest, penalties and similar
amounts with respect thereto, now or thereafter imposed, assessed, levied or
collected by Mexico or any other jurisdiction from which any amount payable
hereunder is made, or any political subdivision or taxing authority thereof or
therein, excluding, however, income, real property or franchise taxes imposed on
the Administrative Agent or the Collateral and Paying Agent or a Lender by a
jurisdiction (including Mexico) solely as a result of the Administrative Agent
or the Collateral and Paying Agent or such Lender, as the case may be, being
organized under the laws of such jurisdiction or being a resident of such
jurisdiction for tax purposes, or by virtue of its having a permanent
establishment or fixed base in such jurisdiction to which income under this
Agreement is attributable or its Applicable Lending Office being located in such
jurisdiction.
"Debt Service Amount" shall mean, for any fiscal quarter of the
Borrower, the aggregate amount of principal of and interest on the Loans
scheduled to fall due during such fiscal quarter.
"Default" shall mean an Event of Default or an event that with the
giving of notice or lapse of time or both would become an Event of Default.
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"Deposit Collateral" has the meaning set forth in Section 12(c)
hereof.
"Derivatives Liabilities" shall mean, with respect to any Person, all
obligations of such Person in respect of any interest rate swap transaction,
basis swap, forward rate transaction, commodity swap, commodity option, equity
or equity index swap, equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor transaction, collar
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including any option with
respect to any of the foregoing transactions) or any combination of the
foregoing transactions. For purposes hereof, the "credit exposure" at any time
of any Person in respect of any Derivatives Liabilities shall be the total
amount of termination or liquidation payments that would be due at such time if
such payments were to become due at such time (excluding penalties and
extraordinary amounts).
"Disposition" shall mean any sale, assignment (but excluding the
creation of any Lien), transfer or other disposition of any Property (whether
now owned or hereafter acquired) by any Person or any of its Subsidiaries.
"Dividend Payment" shall mean the payment of any dividend (in cash,
Property or obligations) on, or other payment or distribution on account of, or
the setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any shares of any
class of stock of the Borrower or any of its Subsidiaries or of any options,
warrants or other rights to acquire the same (or to make any payments to any
Person, such as "phantom stock" payments, where the amount thereof is calculated
with reference to the fair market or equity value of the Borrower or any of its
Subsidiaries), but excluding dividends payable solely in shares of common stock
of the Borrower or any of its Subsidiaries.
"Dollars" and "$" shall mean lawful money for the time being of the
United States of America.
"Early Amortization Event" shall mean the failure by the Borrower, as
of the last day of any one (1) fiscal quarter of the Borrower, to maintain a
Borrower's Debt Service Coverage Ratio of at least 1.50 to 1.00.
"Eligible Assignee" shall mean any of the following:
(a) a commercial bank organized under the laws of the United States of
America, or any State thereof, and having total assets in excess of
$500,000,000;
(b) a savings and loan association or savings bank organized under the
laws of the United States of America, or any State thereof, and having
total assets in excess of $500,000,000;
(c) a commercial bank organized under the laws of any other country
which is a member of the OECD or has concluded special lending arrangements
with the International Monetary Fund associated with its General
Arrangements to
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Borrow, or a political subdivision of any such country, and having total
assets in excess of $1,000,000,000, provided, that such bank is acting
through a branch or agency located in the United States of America;
(d) the central bank of any country which is a member of the OECD;
(e) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership or other entity)
which is engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business, and having total assets in
excess of $150,000,000;
(f) a Lender; and
(g) an Affiliate of a Lender which is a financial institution;
provided, that neither the Borrower nor any Affiliate of the Borrower shall
qualify as an Eligible Assignee; and provided further, that no entity specified
in clauses (a) to (g) above shall qualify as an Eligible Assignee unless such
entity (i) is registered with the Ministry of Finance for purposes of Article
154, Section I, of the Mexican Income Tax Law (Ley del Impuesto Sobre la Renta)
(or any successor provision) and (ii) is a resident for tax purposes of a
country with which Mexico has entered into a treaty for the avoidance of double
taxation which is in effect.
"Eligible Receivables" shall mean accounts receivable denominated in
Dollars and arising from the sale of goods exported to Vitro Packaging by the
Borrower.
"Environmental Law" shall mean any applicable federal, state or local
governmental law, rule, regulation, order or decree relating to pollution or
protection of the environment or the treatment, storage, disposal, release,
threatened release or handling of hazardous materials, including, without
limitation, the Mexican General Law of Ecological Balance and Environmental
Protection (Ley General del Equilibrio Ecologico y la Proteccion al Ambiente),
technical rules (normas tecnicas) and regulations thereunder, and all applicable
local laws and regulations related to environmental matters and any specific
agreements entered into with any competent authorities which include commitments
related to environmental matters.
"Event of Default" shall have the meaning set forth in Section 11
hereof.
"Excess Amount" shall have the meaning set forth in Section 10.12(b)
hereof.
"Existing Restrictions" shall mean the restrictions described in
Schedule 1 hereto.
"Final Maturity Date" shall mean the date occurring five (5) years
after the date hereof; provided, that if such day is not a Business Day, the
Final Maturity Date shall be the immediately preceding Business Day.
"GAAP" shall mean (i) as to the Borrower and each Guarantor other than
Vitro Packaging, generally accepted accounting principles in Mexico in effect
from time to time and
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(ii) as to Vitro Packaging, generally accepted accounting principles in the
United States of America in effect from time to time; provided that nothing
herein shall require a Guarantor, that is consolidated for accounting purposes
with VENA, to maintain independent accounts for purposes hereof. All ratios and
computations herein shall be computed in conformity with GAAP applied on a
consistent basis.
"Governmental Authority" shall mean any nation, government, state or
municipality or other political subdivision thereof and any entity exercising
executive, legislative, judicial, monetary, regulatory or administrative
functions of or pertaining to government.
"Guaranteed Obligations" shall have the meaning set forth in Section
7.01 hereof.
"Guarantee" by any Person shall mean any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Indebtedness
of any other Person including, without limitation, an aval and any obligation,
direct or indirect, contingent or otherwise, of such Person (i) to purchase or
pay (or advance or supply funds for the purchase or payment of) such
Indebtedness (whether arising by virtue of partnership arrangements, or by
agreement to purchase assets, goods, securities or services, or to take-or-pay,
other than agreements to purchase goods on an arm's length basis in the ordinary
course of business) or (ii) entered into for the purpose of assuring in any
other manner the holder of such Indebtedness of the payment thereof or to
protect such holder against loss in respect thereof (in whole or in part),
provided, that the term Guarantee shall not include endorsements for collection
or deposit in the ordinary course of business. The term "Guarantee" used as a
verb has a corresponding meaning.
"Guarantors" shall have the meaning set forth in the introduction
hereto.
"Hedge Agreement" shall mean any interest rate exchange agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"IMSS" shall mean Instituto Mexicano del Seguro Social.
"Indebtedness" shall mean, with respect to any Person at any date,
without duplication, (i) all obligations of such Person for borrowed money; (ii)
all obligations of such Person evidenced by bonds, debentures, notes including
intercompany notes, (excluding the Intercompany Notes) or other similar
instruments; (iii) all obligations of such Person to pay the deferred purchase
price of Property or services (other than trade accounts payable arising in the
ordinary course of business not overdue for more than 60 days); (iv) all Capital
Lease Obligations of such Person and (without duplication) obligations under
Sale-Leaseback Transactions; (v) all obligations of such Person that are
recourse to such Person, as applicable, arising out of transactions described in
Section 10.12(a)(B) hereof; (vi) all obligations, contingent or otherwise, of
such Person to reimburse any Person in respect of amounts paid under a letter of
credit or similar instrument (other than contingent obligations in respect of
documentary letters of credit to support trade transactions of such Person in
the ordinary course of business and with maturities of 270 days or less); (vii)
all Indebtedness of other Persons
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secured by a Lien on any Property of such whether or not such Indebtedness is
assumed by such Person; (viii) all Indebtedness of other Persons Guaranteed by
such Person; and (ix) the credit exposure of such Person in respect of
Derivatives Liabilities.
"INFONAVIT" shall mean Instituto del Fondo Nacional de la Vivienda
para los Trabajadores.
"Information Memorandum" shall mean the Information Memorandum dated
June 2001, relating to the Borrower.
"Intercompany Note" shall have the meaning set forth in Section 9.15
hereof.
"Interest Period" shall mean, with respect to the Loans, the period
commencing on the date of the Loans and ending on the immediately succeeding
Principal Payment Date, and thereafter each period commencing on the last day of
the preceding Interest Period and ending on the next Principal Payment Date,
provided, that the term "Interest Period" shall include any period selected by
the Administrative Agent from time to time in accordance with the definition of
"Post-Default Rate".
"Intermediary" shall mean HSBC Bank USA.
"Investment" shall mean any purchase or other acquisition (whether for
cash, Property, services or securities or otherwise) of any shares of capital
stock of a Person, any capital contribution to such Person or any other equity
investment in such Person.
"Joint Lead Arrangers" shall mean HSBC Securities (USA) Inc. and
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. as Joint Lead Arrangers.
"Lenders" shall have the meaning set forth in the introduction hereto.
"LIBO Rate" shall mean, for any Interest Period, the offered rate for
deposits in U.S. dollars for a period equal to such Interest Period which
appears on Telerate Page 3750, as of approximately 11:00 a.m. London time, on
the date two Business Days prior to the first day of such Interest Period,
provided, that (i) if such rate does not appear on such Telerate Page 3750, the
"LIBO Rate" shall mean, for any Interest Period, the offered rate for deposits
in U.S. dollars for a period equal to or nearest the number of days in such
Interest Period which appears on the Reuters Screen LIBO Page, and (ii) if such
rate or rates do not appear on either Telerate Page 3750 or the Reuters Screen
LIBO Page, the "LIBO Rate" shall mean, with respect to each day during such
Interest Period, the rate per annum equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the respective rates notified to the
Administrative Agent by each Reference Bank as the rate at which U.S. dollar
deposits are offered to such Reference Bank by prime banks at or about 11:00
a.m., London time, two Business Days prior to the beginning of such Interest
Period in the London interbank market for delivery on the first day of such
Interest Period for a period approximately equal to the number of days in such
Interest Period and in an amount comparable to the principal amount of the
Loans.
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"Lien" shall mean any mortgage, lien, pledge, charge, encumbrance or
other security interest or any preferential arrangement that has the practical
effect of creating a security interest.
"Loan" and "Loans" shall have the meanings set forth in Section
2.01(a) hereof.
"Loan Documents" shall mean, collectively, this Agreement, the Notes,
the Security Agreements and the Account Control Agreement.
"Majority Lenders" shall mean Lenders holding more than 66-2/3% of the
aggregate outstanding principal amount of the Loans or, if the Loans are not
outstanding, Lenders having more than 66-2/3% of the aggregate amount of the
Commitments.
"Material Adverse Effect" shall mean a material adverse effect on (i)
the business, condition (financial or otherwise), operations, prospects or
properties of the Borrower and its Subsidiaries, taken as a whole, or of any
Guarantor and its Subsidiaries, taken as a whole, (ii) the ability of the
Borrower or any Guarantor to perform its obligations under the Loan Documents or
(iii) the material rights and remedies of the Lenders, the Administrative Agent
or the Collateral and Paying Agent under any of the Loan Documents.
"Material Subsidiary" shall mean, with respect to the Borrower or any
Guarantor, any Subsidiary whose total assets or total revenues or EBITDA (all on
a consolidated basis taking into account any Subsidiaries of such Subsidiary) as
shown by its latest financial statements, represent at least 10% of the
consolidated total assets or total revenues or EBITDA of such Person (as shown
on the latest consolidated financial statement of such Person).
"Mexican Bank" shall mean a bank chartered under the laws of Mexico
and authorized to carry out the business of banking in Mexico under the Law of
Credit Institutions (Ley de Instituciones de Credito) by the Ministry of
Finance.
"Mexico" shall mean the United Mexican States.
"Ministry of Finance" shall mean the Secretaria de Hacienda y Credito
Publico of Mexico.
"Net Proceeds" shall mean with respect to any Disposition pursuant to
Section 10.12 hereof, the aggregate amount of all cash payments received by VENA
and its Subsidiaries directly or indirectly in connection with such Disposition
(or, for purposes of Section 3.04(b)(ii), the fair market value of the aggregate
cash payments that are or will be received directly or indirectly in connection
with such Disposition); provided that (i) such Net Proceeds shall be net of (x)
the amount of any legal, title and recording tax expenses, commissions and other
fees and expenses paid by VENA and its Subsidiaries in connection with such
Disposition and (y) any Federal, state and local income or other taxes estimated
to be payable by VENA and its Subsidiaries as a result of such Disposition and
(ii) such Net Proceeds shall be net of any repayments by VENA or any of its
Subsidiaries of Indebtedness to the extent that (x) such
-11-
Indebtedness is secured a Lien on the Property that is the subject of such
Disposition and (y) such Indebtedness is in fact repaid upon the consummation of
the purchase of such Property.
"Non-Affiliated Partner" shall have the meaning set forth in Section
10.12(b) hereof.
"Note" shall have the meaning set forth in Section 2.05 hereof.
"Notice of Borrowing" shall have the meaning set forth in Section 2.02
hereof.
"OECD" shall mean the Organization for Economic Cooperation and
Development.
"Operating Lease Obligation" shall mean, with respect to any Person,
the obligations of such Person under any lease (including, without limitation,
leases that may be terminated by the lessee at any time) relating to any
property (whether real, personal or mixed) that does not give rise to Capital
Lease Obligations other than any such lease under which that Person is the
lessor.
"Other Applicable Taxes" shall have the meaning set forth in Section
5.05(e) hereof.
"Permitted Investments" shall mean (a) direct obligations of the
United States of America, or of any agency thereof, or obligations guaranteed as
to principal and interest by the United States of America, or by any agency
thereof, in either case maturing not more than 90 days from the date of
acquisition thereof; (b) certificates of deposit issued by any bank or trust
company organized under the laws of the United States of America or any state
thereof and having capital, surplus and undivided profits of at least
$500,000,000 and a rating with respect to its public, short-term, unsecured,
unsubordinated debt securities of "A-1" or better by Standard & Poor's, or "P-1"
or better by Moody's, or "D-1" or better by Fitch, IBCA, Duff & ▇▇▇▇▇▇, maturing
not more than 90 days from the date of acquisition thereof; (c) commercial paper
rated "A-1" or better by Standard & Poor's, or "P-1" or better by Moody's, or
"D-1" or better by Fitch, IBCA, Duff & ▇▇▇▇▇▇, respectively, maturing not more
than 90 days from the date of acquisition thereof; (d) repurchase agreements
with respect to securities described in clause (a) above entered into with an
office of a bank or trust company meeting the criteria described in clause (b)
above; and (e) any fund at least 95% of the assets of which are invested in
investments of the type referred to in clauses (a) through (c).
"Permitted Liens" shall mean:
(i) Liens imposed by law arising in the ordinary course of business,
including (but not limited to) carriers', warehousemen's and mechanics'
liens and other similar liens arising in the ordinary course of business
and which (x) do not in the aggregate materially detract from the value of
the Property subject thereto or materially impair the use thereof in the
operations of the business of the Borrower and its Subsidiaries or (y) are
being contested in good faith by appropriate proceedings, which proceedings
have the
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effect of preventing the forfeiture or sale of the Property subject to such
liens and for which adequate reserves have been made if required in
accordance with GAAP;
(ii) pledges or deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other
similar social security legislation or in connection with bids relating to
the obtaining of a contract for the manufacture and/or sale of products;
(iii) Liens securing taxes, assessments and other governmental
charges, the payment of which is not yet due or is being contested in good
faith by appropriate proceedings promptly initiated and diligently
conducted and for which such reserve or other appropriate provisions, if
any, as required by GAAP, shall have been made;
(iv) any Lien which arises pursuant to a final judgment to the extent
it does not constitute or give rise to an Event of Default;
(v) any Lien existing on any Property prior to the acquisition thereof
by the Borrower or a Subsidiary and not created in contemplation of such
acquisition (and not extending to any other Property); and
(vi) any right of setoff arising by operation of law.
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or Governmental Authority or other entity of
whatever nature.
"Pesos" shall mean the lawful currency for the time being of Mexico.
"Post-Default Rate" shall mean, in the case of any overdue principal
of any Loan, until the end of the then current Interest Period, a rate per annum
which is equal to the sum of 2% per annum plus the Applicable Margin plus the
LIBO Rate for such Interest Period, and thereafter a rate per annum which is
equal to the sum of 2% per annum plus the Applicable Margin plus the LIBO Rate
applicable to such Interest Period or Interest Periods as shall be selected by
the Administrative Agent for funding of such overdue amounts (which Interest
Periods shall not be of durations exceeding one month), and in the case of any
other overdue amount, a rate per annum equal to the sum of 2% per annum plus the
Applicable Margin plus the rate reasonably determined by the Administrative
Agent, and advised to the Borrower, to be the cost of funding such overdue
amount on an overnight basis in the London interbank market from the date of
such non-payment until such amount is paid in full (as well after as before
judgment).
"Principal Payment Date" shall mean the date falling three months
after the date hereof, and the date falling on the 14th day of the third month
after each previous Principal Payment Date, to and including the Final Maturity
Date; provided that any Principal Payment Date that would otherwise fall on a
day that is not a Business Day shall fall on the previous Business Day.
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"Process Agent" shall have the meaning set forth in Section 14.11(b)
hereof.
"Process Agent Acceptance" shall mean a letter from the Process Agent
to the Administrative Agent, in substantially the form of Exhibit J hereto.
"Property" or "Properties" of any Person shall mean any property or
assets of such Person.
"Reference Banks" shall mean the principal London offices of HSBC Bank
plc, Citibank, N.A. and ABN-AMRO Bank plc.
"Register" shall have the meaning set forth in Section 14.06(c)
hereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System, as amended.
"Required Reserve Balance" shall mean, at any time, an amount equal to
the aggregate amount of principal of and interest on the Loans scheduled to fall
due during the period of the next three months succeeding the date of
calculation.
"Requirement of Law" shall mean, as to any Person, any statute, law,
treaty, rule or regulation or determination, order, injunction or judgment of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its Properties or revenues.
"Reserve Account" shall mean account no. 10-877326 established and
maintained at the principal office in New York City of the Intermediary for the
account of the Borrower, under the sole dominion and control of the Collateral
and Paying Agent and entitled "Compania Vidriera, S.A. de C.V. Reserve Account",
for which the Collateral and Paying Agent is the "entitlement holder" within the
meaning of Section 8-102(a)(7) of the UCC.
"Responsible Officer" shall mean the chief financial officer, chief
accounting officer or such other senior executive officer having primary
responsibility for the matter at hand.
"Reuters Screen" shall mean the relevant display page as determined by
the Administrative Agent of the Reuter Monitor Money Rates Service (or any
successor or substitute page) for the purpose of displaying London interbank
offered rates for Dollar deposits.
"Sale-Leaseback Transaction" shall mean, with respect to any Person,
any transaction in which such Person, directly or indirectly, becomes or remains
liable as lessee or as a guarantor or other surety with respect to any lease,
whether a Capital Lease Obligation or an Operating Lease Obligation, of any
Property, whether then owned or thereafter acquired, (i) which such Person has
sold or otherwise transferred or is to sell or transfer to any other Person or
(ii) which such Person intends to use for substantially the same purposes as any
other Property
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which has been or is sold or transferred by such Person to any other Person in
connection with such lease.
"SAR" shall mean Sistema de Ahorro para el Retiro or mandatory
retirement system of Mexico.
"Security Agreements" shall mean, collectively, the Vidriera Security
Agreement and the Vitro Packaging Security Agreement.
"Solvent" shall mean, with respect to any Person at any time, that (a)
the fair value of the Property of such Person is greater than the total amount
of liabilities (including without limitation contingent liabilities) of such
Person, (b) the present fair saleable value of the Property of such Person is
not less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, (d) such Person is not engaged in a business and is not about to engage
in a business for which such Person's property would constitute an unreasonably
small capital and (e) such Person is not insolvent pursuant to the Mexican Ley
de Concursos Mercantiles.
"Specified Debt" shall mean the Indebtedness of VENA pursuant to the
Credit Agreement dated as of April 13, 1998 among VENA, as Borrower, Vitro, as
Guarantor, the Banks party thereto and HSBC Investment Bank plc, as
Administrative Agent, in an aggregate principal amount outstanding as of the
date hereof equal to $75,000,000.
"Specified Shares" shall mean shares of common stock acquired by VENA
on December 31, 2000 of Vitro OCF, S.A. de C.V., Industria del Alcali, S.A. de
C.V. and Fabricacion de Maquinas, S.A. de C.V., each a Mexican corporation.
"Subsidiary" of any Person shall mean any corporation or other entity
more than 50% of the Voting Shares of which are owned or controlled, directly or
indirectly, by such Person and/or any Subsidiary of such Person.
"Substitute Basis" shall have the meaning set forth in Section 5.02
hereof.
"UCC' shall mean the Uniform Commercial Code as in effect in the State
of New York.
"VENA Debt to EBITDA Ratio" shall mean, at any time, the ratio of (i)
Consolidated Total Debt of VENA at such time to (ii) Consolidated EBITDA of VENA
for the then most recently concluded period of four consecutive fiscal quarters
of VENA (ending on the date as of which the calculation is made). The
Consolidated EBITDA of VENA will be pro forma for the inclusion of the
Consolidated EBITDA of Vitro OCF, S.A. de C.V., Industria del Alcali, S.A. de
C.V. and Fabricacion de Maquinas, S.A. de C.V. during periods when the accounts
of such Persons were not consolidated with those of VENA.
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"VENA Interest Coverage Ratio" shall mean, at any time, the ratio of
(i) Consolidated EBITDA of VENA for the then most recently concluded period of
four consecutive fiscal quarters of VENA to (ii) Consolidated Interest Expense
of VENA for such period. The Consolidated EBITDA of VENA and the Consolidated
Interest Expense of VENA will each be pro forma for the inclusion of the
Consolidated EBITDA and Consolidated Interest Expense of Vitro OCF, S.A. de
C.V., Industria del Alcali, S.A. de C.V. and Fabricacion de Maquinas, S.A. de
C.V. during periods when the accounts of such Persons were not consolidated with
those of VENA.
"Vitro OCF" shall mean Vitro OCF, S.A. de C.V., a Mexican corporation.
"Vitro Packaging Debt Service Coverage Ratio" shall mean, as of the
last day of any fiscal quarter of the Borrower, the ratio of (i) the aggregate
amount collected by Vitro Packaging in respect of its accounts receivable and
remitted to the Vitro Packaging Operating Account during such fiscal quarter to
(ii) the Debt Service Amount for the immediately succeeding fiscal quarter of
the Borrower.
"Vidriera Mexicali" shall mean Vidriera Mexicali, S.A. de C.V., a
Mexican corporation.
"Vidriera Security Agreement" shall mean a Security Agreement between
the Borrower and the Collateral and Paying Agent in substantially the form of
Exhibit B-1 hereto, as from time to time amended.
"Vitro Packaging Operating Account" shall mean account no. 00102619666
held by Vitro Packaging at The Chase Manhattan Bank in Houston, Texas (ABA:
▇▇▇▇▇▇▇▇▇), or any successor operating account or accounts of Vitro Packaging.
"Vitro Packaging Security Agreement" shall mean a Security Agreement
between Vitro Packaging and the Collateral and Paying Agent in substantially the
form of Exhibit B-2 hereto, as from time to time amended.
"Voting Shares" shall mean, with respect to any Person, any class or
classes of capital stock or other ownership interests pursuant to which the
holders thereof have the general voting power under ordinary circumstances to
elect directors, managers or trustees of such Person (irrespective of whether or
not, at the time, stock of any other class or classes has, or might have, voting
power by reason of the happening of any contingency).
SECTION 2. COMMITMENTS, ETC.
2.01 Loans. (a) Each Lender severally agrees, on and subject to the
terms and conditions of this Agreement, to make one term loan to the
Borrower (each a "Loan" and, collectively, the "Loans") in Dollars on a
Business Day on or before the Commitment Termination Date, in an aggregate
principal amount up to but not exceeding such
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Lender's Commitment and, as to all Lenders, in an aggregate principal
amount of $235,000,000.
(b) The proceeds of the Loans shall be used by the Borrower solely (i)
to pay fees and expenses relating to the transactions contemplated hereby,
(ii) to fund the Reserve Account in accordance with Section 12.01(b)
hereof, (iii) to make inter-company loans to VENA to enable VENA to
refinance the Specified Debt, such proceeds, in the case of the Specified
Debt, to be remitted by the Administrative Agent directly to the creditor
or creditors in respect of such Specified Debt in accordance with the
instructions of the Borrower, (iv) to make inter-company loans to Vitro
Packaging to enable Vitro Packaging to refinance its Indebtedness, such
proceeds to be remitted by the Administrative Agent directly to the
creditor or creditors in respect of such Indebtedness in accordance with
the instructions of the Borrower, and (v) to make inter-company loans to
VENA to enable VENA to refinance the purchase price of the Specified Shares
up to an aggregate amount of $126,000,000. Neither any Lender nor either
Agent shall have any responsibility as to the use of any of the proceeds of
any Loan.
2.02 Borrowing. The Borrower shall give the Administrative Agent
written notice of the Borrowing in substantially the form of Exhibit D hereto (a
"Notice of Borrowing") as provided in Section 4.04 hereof. Not later than 11:00
a.m. New York time on the date specified for the Borrowing, each Lender shall
make available the amount of the Loan to be made by it on such date to the
Administrative Agent, at the Administrative Agent's Account, in immediately
available funds, for account of the Borrower. The amount so received by the
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be remitted by the Administrative Agent as agreed between the
Borrower and the Administrative Agent in accordance with the terms of this
Agreement.
2.03 Fees. The Borrower agrees to pay to the Administrative Agent and
the Arrangers fees in such amounts, on such terms and at such times as
previously agreed upon between the Borrower and the Administrative Agent and the
Joint Lead Arrangers.
2.04 Several Obligations; Certain Remedies Independent. The failure of
any Lender to make the Loan to be made by it on the occasion of the Borrowing
shall not relieve any other Lender of its obligation to make its Loan on such
date, but neither any Lender nor any Agent shall be responsible for the failure
of any other Lender to make the Loan to be made by such other Lender on such
date, and no Lender shall have any obligation to any Agent or any other Lender
for the failure by such Lender to make any Loan required to be made by such
Lender. The amounts payable by the Borrower at any time hereunder and under the
Notes to each Lender shall be a separate and independent debt, and each Lender
shall be entitled to protect and enforce its individual rights arising out of
this Agreement and the Notes independently of any other Lender, except to the
extent this Agreement expressly provides that the exercise of any right shall
require the consent of the Majority Lenders or of all of the Lenders, and,
except as so required, it shall not be necessary for any other Lender or any
Agent to consent to, or be joined as an additional party in, any proceedings to
recover the payment of any overdue amounts.
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2.05 Notes. The Loan by each Lender shall be evidenced by a promissory
note (▇▇▇▇▇▇) of the Borrower substantially in the form of Exhibit A hereto
(each, a "Note"), dated the date of such Loan, payable to such Lender in an
amount equal to the principal amount of such Loan. In the case of any conflict
between the provisions of this Agreement and the terms of any Note, the
provisions of this Agreement shall be deemed to prevail and the Borrower and
each Guarantor shall be entitled to use this Agreement as a defense in
connection with any action brought against any of them solely under the Notes.
SECTION 3. PAYMENTS OF PRINCIPAL AND INTEREST.
3.01 Repayment of Loans. The Borrower agrees to pay to the
Administrative Agent for the pro rata account of the Lenders the full principal
amount of the Loans in 20 equal consecutive quarterly installments, one such
installment to be payable on each Principal Payment Date.
3.02 Interest.
(a) The Borrower agrees to pay to the Administrative Agent for account
of each Lender interest on the unpaid principal amount of the Loan made by
such Lender for the period from and including the date of such Loan to but
excluding the date such Loan shall be paid in full, at a rate per annum
equal to the LIBO Rate for each Interest Period plus the Applicable Margin.
(b) Notwithstanding the foregoing, the Borrower agrees to pay to the
Administrative Agent for account of each Lender interest at the
Post-Default Rate on any principal of the Loan of such Lender, and on any
other amount whatsoever payable by the Borrower hereunder, that is not paid
in full when due (whether at stated maturity, by acceleration, or
otherwise), for the period from and including the due date thereof to but
excluding the date the same is paid in full.
(c) Accrued interest on each Loan shall be payable on the last day of
each Interest Period and upon each payment or prepayment thereof (on the
principal amount so paid or prepaid), provided, that interest payable at
the Post-Default Rate shall be payable from time to time on demand.
(d) Promptly after the determination of any interest rate provided for
herein or any change therein pursuant to this Agreement, the Administrative
Agent shall (without limiting the requirements of Section 14.02 that all
notices be in writing) give written notice thereof to the Lenders and to
the Borrower. Each determination by the Administrative Agent of an interest
rate hereunder shall be conclusive and binding for all purposes, absent
manifest error.
3.03 Optional Prepayments. The Borrower shall have the right to prepay
the Loans in whole or in part at any time or from time to time, which prepayment
shall in each case be made together with accrued and unpaid interest thereon and
all other amounts payable under
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this Agreement (including without limitation Section 5.04 hereof) without
premium or penalty (subject to Section 5.04 hereof), provided, that (i) the
Borrower shall give the Administrative Agent notice of each prepayment under
this Section 3.03 as provided in Section 4.04 hereof (and, upon the date
specified in any such notice, the amount to be prepaid shall become due and
payable hereunder), (ii) each partial prepayment hereunder shall be in the
aggregate amount of not less than $5,000,000 and (iii) each prepayment hereunder
shall be applied to the installments of principal of the Loans in inverse order
of maturity as among such installments. Amounts prepaid hereunder may not be
reborrowed.
3.04 Mandatory Prepayments.
(a) Promptly upon the receipt by the Borrower of any payment or
prepayment of principal of any Intercompany Note by VENA or Vitro Packaging in
cash, which is raised from external sources during the term of this Agreement,
the Borrower will prepay the Loans in an aggregate amount equal to the amount of
such payment or prepayment, together with interest accrued on the amount prepaid
and all amounts payable under with Section 5.04 hereof. Prepayments under this
Section 3.04(a) shall be applied to the installments of principal of the Loans
pro rata as among such installments. Amounts prepaid hereunder may not be
reborrowed.
(b) (i) Concurrently with the receipt of any Net Proceeds from any
Disposition of Voting Shares of Vitro OCF, as provided in clause (iv) of the
definition of "Change of Control" in Section 1.01 hereof, or with any
Disposition by VENA of any shares of capital stock or Properties of Vidriera
Mexicali, to a Person which is not an Affiliate of Vitro, as provided in Section
10.12(b) hereof, Vitro or VENA, as applicable, shall advance the Net Proceeds
thereof to the Borrower (directly or indirectly through one or more intermediate
Subsidiaries of VENA) as additional equity capital or intercompany debt, and the
Borrower shall forthwith prepay the Loans in an amount equal to the aggregate
amount of such Net Proceeds received by the Borrower.
(ii) If VENA shall make a Disposition of any shares of capital stock
or Properties of Vidriera Mexicali, to an Affiliate of Vitro (an "Affiliated
Purchaser"), as provided in Section 10.12(b) hereof, then VENA shall, within 10
days after the date on which the beneficiary of Vidriera Mexicali's capital
stock or Properties commences substantial business operations under the
ownership of such Affiliated Purchaser, advance one-half of the Net Proceeds
thereof to the Borrower (directly or indirectly through one or more intermediate
Subsidiaries of VENA) as additional equity capital or intercompany debt, and the
Borrower shall forthwith upon receipt thereof prepay the Loans in an amount
equal to one-half of such Net Proceeds, with the remaining one-half of such Net
Proceeds to be advanced by VENA within twelve months after the initial
prepayment of one-half of the Net Proceeds (directly or indirectly through one
or more intermediate Subsidiaries of VENA) as additional equity capital or
intercompany debt, and the Borrower shall forthwith prepay the Loans in an
amount equal to such remaining one-half of such Net Proceeds.
Prepayments under this Section 3.04(b) shall be applied to the
installments of principal of the Loans in the inverse order of maturity as among
such installments. Amounts prepaid hereunder may not be reborrowed.
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SECTION 4. PAYMENTS, ETC.
4.01 Payments
(a) The Borrower shall make each payment of principal of, and interest
on, the Loans and of fees and other amounts payable hereunder not later
than 12:00 noon (New York time) on the date when due, in Dollars and
immediately available funds, at the Collection Account, without deduction,
set-off or counterclaim.
(b) The Borrower shall, at the time of making each payment under this
Agreement and the Notes for account of any Lender, specify to the
Administrative Agent the amounts payable by the Borrower hereunder to which
such payment is to be applied (and in the event that the Borrower fails to
so specify, or if an Event of Default has occurred and is continuing, the
Administrative Agent may distribute such payment to the Lenders for
application in such manner as it or the Majority Lenders, subject to
Section 4.02 hereof, may determine to be appropriate).
(c) Each payment received by the Administrative Agent under this
Agreement for account of any Lender shall be paid by the Administrative
Agent promptly to such Lender, in immediately available funds, for account
of such Lender's Applicable Lending Office.
(d) If the due date of any payment under this Agreement would
otherwise fall on a day that is not a Business Day, such date shall
(subject to the definition of "Principal Payment Date") be the next
preceding Business Day.
4.02. Pro Rata Payments. Except to the extent otherwise expressly
provided herein, (a) the Loans shall be made by the Lenders pro rata according
to the amounts of their respective Commitments; (b) each payment or prepayment
of principal of the Loans shall be made for account of the Lenders pro rata in
accordance with the respective unpaid principal amounts of the Loans held by
them; and (c) each payment of interest on the Loans shall be made for account of
the Lenders pro rata in accordance with the respective amounts of interest on
the Loans then due and payable to them.
4.03 Computations. Interest on the Loans shall be computed on the
basis of a year of 360 days and the actual number of days elapsed (including the
first day but excluding the last day) occurring in the period for which interest
shall be payable.
4.04 Certain Notices. Notice of Borrowing shall be effective only if
received by the Administrative Agent not later than 11:00 a.m. New York time on
the date three Business Days prior to the date of the Borrowing, and each notice
of optional prepayment shall be effective only if received by the Administrative
Agent not later than 11:00 a.m. New York time on the date ten Business Days
prior to the date of such prepayment. The Notice of Borrowing shall specify the
amount to be borrowed, the date of the Borrowing (which shall be a Business
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Day), the Specified Debt to be refinanced (with appropriate remittance
instructions) with the proceeds thereof, the Indebtedness of Vitro Packaging to
be refinanced (with appropriate remittance instructions) with the proceeds
thereof, and the portion thereof to be used to refinance all or a portion of the
purchase price of the Specified Shares. Each notice of optional prepayment shall
specify (subject to Section 3.03 hereof) the amount to be prepaid and the date
of prepayment (which shall be a Business Day). The Administrative Agent shall
promptly notify the Lenders of the contents of each such notice.
4.05 Non-Receipt of Funds by the Administrative Agent. Unless the
Administrative Agent shall have been notified in writing by any Lender or the
Borrower (each, a "Payor") prior to the date on which the Payor is to make
payment to the Administrative Agent (in the case of a Lender) of the proceeds of
a Loan to be made by such Lender hereunder or (in the case of the Borrower) of a
payment to the Administrative Agent for account of one or more of the Lenders
hereunder (any such payment being herein called the "Required Payment") that
such Lender or the Borrower, as the case may be, will not make the Required
Payment, the Administrative Agent may assume that the Payor is making the
Required Payment available to the Administrative Agent and, in reliance upon
such assumption, make available to the relevant Lenders or the Borrower, as the
case may be, a corresponding amount. If such amount is not made available to the
Administrative Agent by the required time on such date, the Payor shall pay to
the Administrative Agent, on demand, such amount with interest thereon at a rate
(in the case of a Lender) equal to the rate specified by the Administrative
Agent as its cost of funding such amount for the period and (in the case of the
Borrower) equal to the rate specified in Section 3.02(b) hereof, in each case
until such amount is made available to the Administrative Agent. A certificate
of the Administrative Agent submitted to any Payor with respect to any amounts
owing under this Section shall be conclusive in the absence of manifest error.
4.06 Sharing of Payments.
(a) If any Lender shall obtain payment of any principal of or interest
on a Loan or payment of any other amount under this Agreement or the Notes
through the exercise of any right of set-off, banker's lien or counterclaim
or similar right or otherwise (other than from the Administrative Agent as
provided herein), and, as a result of such payment, such Lender shall have
received a percentage of the principal of or interest on such Loan or such
other amounts then due hereunder by the Borrower to such Lender in excess
of its pro rata share thereof, it shall promptly purchase from such other
Lenders participations in (or, if and to the extent specified by such
Lender, direct interests in) the Loans or such other amounts, respectively,
owing to such other Lenders (or in interest due thereon, as the case may
be) in such amounts, and make such other adjustments from time to time, as
shall be equitable, to the end that all the Lenders shall share the benefit
of such excess payment (net of any expenses that may be incurred by such
Lender in obtaining or preserving such excess payment) pro rata in
accordance with the unpaid principal of and/or interest on the Loans or
such other amounts, respectively, owing to each of the Lenders, it being
understood that neither the Borrower nor any Guarantor hereunder shall have
any liability in respect of any action or inaction by any Lender hereunder.
To such end all the Lenders shall make appropriate adjustments among
themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be
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restored; provided, that if any Lender shall commence an action or
proceeding in any court to collect the principal of or interest on a Loan
held by, or any other amount owed to, such Lender, and as a result thereof
shall receive a disproportionate payment (other than any such payment
received by such Lender as a result of attachment of, or set-off, exercise
of banker's lien or any other proceedings against, deposits or other
property held by such Lender), such Lender shall not be required to share
any portion of such disproportionate payment with any other Lender which,
having received notice from such first-mentioned Lender (through the
Administrative Agent) of such action or proceeding, had the legal right to,
but did not, join such action or proceeding or commence and diligently
prosecute a separate action or proceeding in any appropriate court to
collect (as applicable) the principal of or interest on the Loans held by,
or other such amount owed to, such other Lender.
(b) Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain
the benefits of exercising, any such right with respect to any other
indebtedness or obligation of the Borrower or any Guarantor.
SECTION 5. YIELD PROTECTION, ETC.
5.01 Additional Costs.
(a) If, on or after the date hereof, the adoption of any Requirement
of Law, or any change in any Requirement of Law, or any change in the
interpretation or administration thereof by any court or other Governmental
Authority charged with the interpretation or administration thereof, or
compliance by any Lender (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
Governmental Authority, shall impose, modify or deem applicable any reserve
(including, without limitation, any such requirement imposed by the Board
of Governors of the Federal Reserve System), special deposit, contribution,
insurance assessment or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any Lender (or its
Applicable Lending Office) or shall impose on any Lender (or its Applicable
Lending Office) or the London interbank market any other condition
affecting its Loans, its Notes or its Commitment, and the result of any of
the foregoing is to increase the cost to such Lender (or its Applicable
Lending Office) of making or maintaining any Loan, or to reduce the amount
of any sum received or receivable by such Lender (or its Applicable Lending
Office) under this Agreement or under any Note, by an amount reasonably
deemed by such Lender to be material (other than Taxes, which shall be
treated in accordance with Section 5.05 hereof), then the Borrower shall
pay to such Lender on the date five (5) business days after demand, such
additional amount or amounts as will compensate such Lender for such
increased cost or reduction.
(b) If any Lender shall have determined that, after the date hereof,
the adoption of any Requirement of Law regarding capital adequacy, or any
change therein, or any
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change in the interpretation or administration thereof by any Governmental
Authority charged with the interpretation or administration thereof, or any
request or directive regarding capital adequacy (whether or not having the
force of law) of any such Governmental Authority, has or would have the
effect of reducing the rate of return on capital of such Lender (or its
parent) as a consequence of such Lender's obligations hereunder or its
Loans to a level below that which such Lender (or its parent) could have
achieved but for such adoption, change, request or directive by an amount
reasonably deemed by it to be material, then from time to time, within 15
days after demand (which refers to the relevant Requirement of Law in
reasonable detail) by such Lender, the Borrower shall pay to such Lender
such additional amount or amounts as will compensate such Lender (or its
parent) for such reduction.
(c) Each Lender will promptly notify the Borrower of any event of
which it has knowledge, occurring after the date hereof, which will entitle
such Lender to compensation pursuant to this Section, such notice to
provide reasonable detail of such event. Before giving any such notice
pursuant to this subsection (c) such Lender shall designate a different
Applicable Lending Office if such designation (x) will, in the reasonable
judgment of such Lender, avoid the need for, or reduce the amount of, such
compensation and (y) will not, in the reasonable judgment of such Lender,
be materially disadvantageous to such Lender. A certificate of any Lender
claiming compensation under this Section 5.01, setting forth the additional
amount or amounts to be paid to it hereunder and providing reasonable
detail as aforesaid, shall be conclusive and binding on the Borrower in the
absence of manifest error. In determining such amount, such Lender may use
any reasonable averaging and attribution methods as long as such methods
are consistent with such Lender's treatment of customers similar to Vitro
and the Borrower having generally similar provisions in their agreements
with such Lender. Notwithstanding anything to the contrary in clauses (a)
and (b) above, no Lender shall be entitled to make a claim for compensation
with respect to any event occurring more than 180 days prior to the date on
which such Lender notifies the Borrower of its claim for compensation.
(d) If any Lender requests compensation under this Section 5.01, the
Borrower may, at its sole expense and effort, upon notice to such Lender
and the Administrative Agent, require such Lender to assign and delegate,
without recourse (subject to the restrictions contained in Section 14.06),
all of its interests, rights and obligations under this Agreement to an
assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) such
assignee shall be subject to the prior consent of the Administrative Agent,
which consent shall not unreasonably be withheld, (ii) such Lender shall
have received payment in full of the outstanding principal of its Advances,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, and (iii) such assignment is reasonably expected to result in a
reduction in such compensation or payments. A Lender shall not be required
to make any such assignment and delegation if, prior thereto, as a result
of a waiver by such Lender or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation cease to apply.
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(e) If the Ministry of Finance shall at any time determine that the
administrative fees payable pursuant to Section 2.03 hereof constitute
"interest" as that term is defined under Article 154, Section I, of the
Mexican Income Tax Law (Ley del Impuesto sobre la Renta) and as a result
are subject to Mexican withholding tax, the Administrative Agent shall make
a reasonable effort to assign its rights and duties hereunder to a
registered Affiliate that is an Eligible Assignee if it can do so without
material cost, expense or legal detriment to it, in its sole and absolute
judgment.
5.02 Substitute Basis. If, on or prior to the first day of any
Interest Period (an "Affected Interest Period"):
(a) the Administrative Agent determines that, by reason of
circumstances affecting the London interbank eurodollar market, the "LIBO
Rate" cannot be determined pursuant to the definition thereof, or
(b) the Majority Lenders determine and notify the Administrative Agent
that the relevant rates of interest referred to in the definition of "LIBO
Rate" in Section 1.01 hereof upon the basis of which the rate of interest
for Loans for such Affected Interest Period is to be determined will not be
adequate to cover the cost to such Lenders of making or maintaining their
Loans for such Affected Interest Period,
the Administrative Agent shall give notice thereof (a "Rate Determination
Notice") to the Borrower and the Lenders as soon as practicable thereafter. If
such notice is given, during the thirty-day period following such Rate
Determination Notice (the "Negotiation Period") the Administrative Agent and the
Borrower shall negotiate in good faith with a view to agreeing upon a substitute
interest rate basis (having the written approval of the Majority Lenders) for
the Loans which shall reflect the cost to the Lenders of funding their Loans
from alternative sources (a "Substitute Basis"), and if such Substitute Basis is
so agreed upon during the Negotiation Period, such Substitute Basis shall apply
in lieu of the LIBO Rate to all Interest Periods commencing on or after the
first day of the Affected Interest Period, until the circumstances giving rise
to such notice have ceased to apply. If a Substitute Basis is not agreed upon
during the Negotiation Period, the Borrower may elect to prepay the Loans
pursuant to Section 3.03 hereof; provided, however, that if the Borrower does
not elect so to prepay, each Lender shall determine in good faith (and shall
certify from time to time in a certificate delivered by such Lender to the
Administrative Agent, which the Administrative Agent shall promptly deliver to
the Borrower, setting forth in reasonable detail the basis of the computation of
such amount) the rate basis reflecting the cost to such Lender of funding its
Loans for any Interest Period commencing on or after the first day of the
Affected Interest Period, until the circumstances giving rise to such notice
have ceased to apply, and such rate basis shall be binding upon the Borrower and
such Lender and shall apply in lieu of the LIBO Rate for the relevant Interest
Periods.
5.03 Illegality. Notwithstanding any other provision of this
Agreement, in the event that on or after the date hereof the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
by any Governmental Authority shall make it unlawful for any Lender or its
Applicable Lending Office to make or maintain Loans hereunder
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(and, in the opinion of such Lender, the designation of a different Applicable
Lending Office would either not avoid such unlawfulness or would be
disadvantageous to such Lender), then such Lender shall promptly notify the
Borrower thereof (with a copy to the Administrative Agent) following which (a)
such Lender's Commitment shall be suspended until such time as such Lender may
again make and maintain Loans hereunder and (b) if such Requirement of Law shall
so mandate, such Lender's Loans shall be prepaid by the Borrower, together with
accrued and unpaid interest thereon and all other amounts payable by the
Borrower under this Agreement, on or before such date as shall be mandated by
such Requirement of Law; provided, however, that if it is lawful for such Lender
to maintain its Loans through the last day of the current Interest Period, such
payment shall be made on such date; provided further, however, that the relevant
Lender shall use its reasonable efforts to avoid or minimize the effect of such
Requirement of Law, including by transferring the affected Loan or Loans to a
different lending office, if it can do so without material cost, expense or
legal detriment to it, in its sole and absolute judgment.
5.04 Compensation. The Borrower shall pay to the Administrative Agent
for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts (if any) as shall be sufficient to
compensate it for any loss, cost or expense that such Lender determines is
attributable to:
(a) any optional or mandatory prepayment of any Loan made by such
Lender for any reason on a date other than the last day of an Interest
Period; or
(b) any failure by the Borrower for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 6 hereof to be satisfied) to make a Borrowing on the date for such
Borrowing specified in the relevant Notice of Borrowing given pursuant to
Section 2.02 hereof, or to prepay such Loan in accordance with a notice of
prepayment under Section 3.03 hereof.
Each Lender will furnish to the Borrower a certificate setting forth the basis
and amount of each request by such Lender for compensation under this Section
5.04, which certificate shall be conclusive and binding on the Borrower in the
absence of manifest error.
5.05 Taxes.
(a) All payments on account of the principal of and interest on the
Loans and the Notes, fees and all other amounts payable hereunder by the
Borrower to or for the account of each Agent or any Lender, including,
without limitation, amounts payable under paragraph (b) of this Section
5.05, shall be made free and clear of and without reduction or liability
for Covered Taxes, unless otherwise required by applicable law, decree or
regulation.
(b) The Borrower shall indemnify each Agent and each Lender against,
and reimburse them upon demand for, any Covered Taxes paid at any time by
such Agent or such Lender (as the case may be) and any loss, liability,
claim or expense, including interest, penalties, surcharges and legal fees,
that such Agent or such Lender may incur at
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any time arising out of or in connection with any failure of the Borrower
to make any payment of Covered Taxes when due. Each Agent and Lender
agrees promptly to notify the Borrower of any event known to it that
would give rise to a payment under this Section 5.05(b) by the Borrower.
(c) Subject to compliance by the Agent and the relevant Lender with
its obligations specified in this Section 5.05, in the event that the
Borrower, any Person making a payment hereunder on behalf of the Borrower
or any Agent shall be required by applicable law, decree or regulation to
deduct or withhold Covered Taxes from any amounts payable on, under or in
respect of this Agreement, any other Loan Document or the Loans, the sum
payable shall be increased as necessary so that after making all required
deductions and withholdings the recipient of such payment receives an
amount equal to the sum it would have received had no such deduction or
withholding been made.
(d) The Borrower shall furnish to the Administrative Agent copies,
certified by the Responsible Officer of the Borrower, of the tax forms,
duly completed and evidencing each payment of Covered Taxes required under
this Section 5.05, as soon as practicable (and in any event no later than
45 days) after the date such payment is made, and the Borrower shall
promptly furnish to the Administrative Agent at its request or at the
request of any Lender (through the Administrative Agent) or the other Agent
any other information, documents and receipts that the Administrative Agent
or such other Agent or such Lender may reasonably require to establish that
full and timely payment has been made of all Covered Taxes required to be
paid under this Section 5.05.
(e) The Borrower agrees to pay all present and future stamp, court or
documentary taxes and any other excise taxes, charges or similar levies and
any related interest or penalties incidental thereto imposed by Mexico, or
any jurisdiction from which any amount payable hereunder is made, or any
municipality or other political subdivision or taxing authority thereof or
therein which arises from any payment made by the Borrower hereunder or
from the execution, delivery, enforcement or registration (if mandatory
under Mexican law) of the Loan Documents (hereinafter referred to as "Other
Applicable Taxes").
(f) Each Lender (other than a Mexican Bank) party to this Agreement on
the date hereof (A) represents and warrants to the Borrower that, as of the
date hereof, such Lender (i) is registered with the Ministry of Finance as
a foreign financial institution for purposes of Article 154, Section I, of
the Mexican Income Tax Law (Ley del Impuesto sobre la Renta), the
regulations thereunder and any administrative rules issued thereunder and
intends to be the effective beneficiary of the interest payable under this
Agreement and the other Loan Documents and (ii) is a resident of a country
(or the main office of which, if lending through a branch or agency, is
resident of a country) with which Mexico has entered into a treaty for the
avoidance of double taxation which is in effect, and complies with the
requirements provided in such treaty to apply a reduced withholding tax
rate on interest, and (B) agrees that it will use reasonable efforts to (x)
continue to comply with the requirements of such treaty for so long as it
provides a
-26-
reduced withholding tax rate under the Mexican Income Tax Law or
such double taxation treaty, (y) file all documentation necessary to
maintain its registration with the Ministry of Finance pursuant to Article
154, Section I, of the Mexican Income Tax Law, so long as such requirement
remains applicable, and (z) maintain its status (directly or through its
main office, if lending through a branch or agency) as a resident for tax
purposes of the country of which it is currently a resident and be the
effective beneficiary of any interest paid.
(g) Each Lender (other than a Mexican Bank) and the Administrative
Agent will use all reasonable commercial efforts to provide to the Borrower
(or as appropriate, complete and file with the appropriate governmental
authority), within 60 days of a written request made by the Borrower, such
duly completed form, certification or similar documentation, if any, as is
then required under applicable law, regulation or published administrative
rule or double taxation treaty to which Mexico is a party, which is in
effect, in order to obtain an exemption from, or reduced rate of,
deduction, payment or withholding in respect of Covered Taxes to which such
Lender or the Administrative Agent would be entitled on interest payments
made to such Lender or the Administrative Agent pursuant to a tax treaty
that is in effect or the law or regulations of the relevant jurisdiction;
provided, that neither any Lender nor the Administrative Agent shall have
any obligation to provide such form, certification or similar document
(unless required under applicable law) if, in the sole and absolute
judgment of such Lender or the Administrative Agent, as the case may be,
the provision of such form, certification or similar document would be
materially disadvantageous to such Lender or the Administrative Agent.
(h) Any Lender (other than a Mexican Bank) claiming any additional
amounts payable pursuant to this Section 5.05, which are in excess of the
tax imposed at the lowest rate of withholding that would be otherwise
applicable to such Lender and which exceed additional amounts payable on
the date hereof (provided, that such Lender is in compliance with the
requirements set forth in Section 5.05(f), (g) and (i)), agrees to use
reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to change the jurisdiction of its Applicable
Lending Office if, in the sole and absolute judgment of such Lender, such
change (i) would eliminate or reduce any such excess additional amounts and
(ii) would not otherwise be materially disadvantageous to such Lender.
(i) The Borrower shall not be required to indemnify any Lender under
clauses (a), (b) or (c) of this Section 5.05 for any additional amounts in
respect of Covered Taxes to the extent that such Covered Taxes or portion
thereof would not have been withheld but for the fact that the
representation and warranty in clause (f) above is incorrect with respect
to such Lender or the failure of such Lender to comply with the provisions
of clauses (f), (g) (unless such Lender is a Mexican Bank) and (h) of this
Section 5.05. Each Lender (other than a Mexican Bank) agrees to use its
reasonable efforts to file a timely application for renewal of its
registration in accordance with the relevant provisions of the Mexican
Income Tax Law, and promptly notify the Borrower that it has made such
filing.
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SECTION 6. CONDITIONS PRECEDENT.
6.01 Conditions to Effectiveness. The effectiveness of Section 2.01(a)
hereof shall be subject to the conditions precedent that (i) the Majority
Lenders shall not have determined, and notified the Administrative Agent, that
an event or circumstance has occurred since December 31, 2000 that has had a
Material Adverse Effect, (ii) the Majority Lenders shall not have determined,
and notified the Administrative Agent, that a material adverse change has
occurred since December 31, 2000 in Mexico or in the market for loan or debt
securities of Mexican borrowers, and (iii) the Administrative Agent shall have
received the following documents (with certified English translations of
documents not in English, except for the estatutos sociales, powers of attorney
and the Board of Directors authorization), each of which shall be in form and
substance satisfactory to the Administrative Agent (provided that such
conditions shall be satisfied not later than August 16, 2001):
(a) Executed Agreement. This Agreement, duly executed and delivered by
the Borrower and the Guarantors and each of the other parties hereto.
(b) Security Agreements. (i) The Vidriera Security Agreement, duly
executed and delivered by the Borrower and the Collateral and Paying Agent,
(ii) the Vitro Packaging Security Agreement, duly executed and delivered by
Vitro Packaging and the Collateral and Paying Agent and (iii) the Account
Control Agreement, duly executed and delivered by the Borrower, the
Collateral and Paying Agent and the Intermediary, together with evidence of
the perfection and first priority of the Liens created thereby.
(c) Approvals. Certified copies of all licenses, consents,
authorizations and approvals of, and notices to and filings and
registrations with, any Governmental Authority (including, without
limitation, all foreign exchange approvals), and of all third-party
consents and approvals, if any, necessary in connection with the making and
performance by the Borrower and the Guarantors of the Loan Documents and,
in the case of VENA and Vitro Packaging, the Intercompany Notes, to which
they are a party and the transactions contemplated hereby and thereby.
(d) Corporate Documents. Certified copies of (i) the estatutos
sociales and other constitutive documents of the Borrower and each
Guarantor other than Vitro Packaging, together with powers of attorney of
the Borrower and each Guarantor other than Vitro Packaging, notarized by a
Mexican notary public (including for actos de dominio) authorizing the
relevant officers thereof to execute each Loan Document to which it is a
party and (ii) the certificate of incorporation and by-laws of Vitro
Packaging and of resolutions of its Board of Directors authorizing the
making and performance by it of the Loan Documents to which it is a party.
(e) Incumbency Certificate. A certificate of the Borrower and each
Guarantor in substantially the form of Exhibit E hereto as to the
authority, incumbency and specimen
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signatures of the persons who have executed the Loan Documents and any
other documents in connection herewith on behalf of the Borrower and each
Guarantor.
(f) Opinions of Counsel.
(1) An opinion, dated the Closing Date, of the General Counsel to
the Borrower and each Guarantor, in substantially the form of Exhibit
F hereto.
(2) An opinion, dated the Closing Date, of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇,
special New York counsel to the Borrower and each Guarantor, in
substantially the form of Exhibit G hereto.
(3) An opinion, dated the Closing Date, of ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇, S.C., special Mexican counsel to the Administrative Agent and
the Collateral and Paying Agent, in substantially the form of Exhibit
H hereto.
(4) An opinion, dated the Closing Date, of Milbank, Tweed, ▇▇▇▇▇▇
& ▇▇▇▇▇▇ LLP, special New York counsel to the Administrative Agent and
the Collateral and Paying Agent, in substantially the form of Exhibit
I hereto.
(g) Process Agent Acceptance. (i) A Process Agent Acceptance, duly
executed and delivered by the Process Agent, in substantially the form of
Exhibit J hereto and (ii) a Mexican law notarized power of attorney of the
Borrower and each Guarantor other than Vitro Packaging appointing such
Process Agent.
(h) Fees. Irrevocable authorization by the Borrower to deduct all fees
referred to in Section 2.03 and all reasonable and documented accrued fees
and expenses of each Agent and of the expenses then due and payable under
Section 14.03 hereof, including, without limitation, the reasonable and
documented fees and expenses of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP,
special New York counsel to the Administrative Agent and the Collateral and
Paying Agent, and ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇, S.C., special Mexican counsel
to the Administrative Agent and the Collateral and Paying Agent, in
connection with the negotiation, preparation, execution and delivery of the
Loan Documents and the making of the Loans hereunder, and also including
all stamp taxes or similar taxes in connection with the Loan Documents,
from the proceeds of the Loans; provided, that a statement of such fees and
expenses shall have been submitted at least two Business Days prior to the
date hereof.
(i) Other Documents. Such other documents relating hereto as either
Agent or any Lender shall reasonably request.
6.02 Additional Conditions to Borrowing. The obligation of each Lender
to make its Loan hereunder is also subject to further conditions precedent that
both immediately
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prior to the making of such Loan and also after giving effect thereto and to the
intended use thereof:
(A) no Default shall have occurred and be continuing;
(B) the representations and warranties made by the Borrower and the
Guarantors in Section 8 hereof shall be true on and as of the date of such
Loan and immediately after giving effect to the application of the proceeds
thereof with the same force and effect as if made on and as of such date
(or, in the case of any representation and warranty that expressly relates
to a specific date, as of such specific date);
(C) the Administrative Agent shall have received the Notes evidencing
the Loans in accordance with Section 2.05 hereof;
(D) the Administrative Agent shall have received the Notice of
Borrowing in accordance with Section 2.02 hereof; and
(E) the Administrative Agent shall have received irrevocable
instructions signed by the Borrower, in form and substance satisfactory to
the Administrative Agent, as to the remittance by the Administrative Agent
of the proceeds of the Loans (such instructions to be consistent with the
provisions of Section 2.01(b) hereof).
The Notice of Borrowing by the Borrower hereunder shall constitute a
certification by the Borrower to the effect that the conditions set forth in
clauses (A) and (B) of this Section 6.02 have been fulfilled (both as of the
date of such notice and, unless the Borrower otherwise notifies the
Administrative Agent prior to the date of the Borrowing, as of the date of the
Borrowing).
SECTION 7. GUARANTEE.
7.01 The Guarantee. The Guarantors hereby jointly and severally
guarantee to the Lenders, the Collateral and Paying Agent and the Administrative
Agent the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the principal of and interest on the Loans and the
Notes and all fees, indemnities and other amounts whatsoever now or hereafter
payable or becoming payable by the Borrower under the Loan Documents, in each
case strictly in accordance with the terms thereof (the obligations of the
Borrower to pay such amounts being herein collectively called the "Guaranteed
Obligations"). The Guarantors hereby further jointly and severally agree that if
the Borrower shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors
will promptly pay the same upon receipt from the Administrative Agent of written
demand for payment thereof, without any other demand or notice whatsoever, and
that in the case of any extension of time of payment or renewal of any of the
Guaranteed Obligations, the same will be promptly paid in full when due (whether
at extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal. This Agreement is a continuing guaranty and is a
guaranty of payment and is not merely a guaranty of collection.
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7.02 Acknowledgments, Waivers and Consents. Each Guarantor agrees that
the obligations of such Guarantor under Section 7.01 hereof shall, to the
fullest extent permitted by applicable law, be absolute, irrevocable and
unconditional under any and all circumstances. Without limiting the foregoing,
each Guarantor agrees that:
(a) The occurrence of any one or more of the following shall not, to
the maximum extent permitted under applicable law, affect the enforceability or
effectiveness of this Section 7 in accordance with its terms or affect, limit,
reduce, discharge or terminate the liability of such Guarantor, or the rights,
remedies, powers and privileges of the Administrative Agent, the Collateral and
Paying Agent or any Lender under this Section 7:
(i) any modification or amendment (including without limitation by way
of amendment, extension, renewal or waiver), or any acceleration or other
change in the time for payment or performance of the terms of all or any
part of the Guaranteed Obligations or any Loan Document, or any other
agreement or instrument whatsoever relating thereto, or any modification of
the Commitments;
(ii) any release, termination, waiver, abandonment, lapse or
expiration, subordination or enforcement of the liability of any Guarantor
under this Agreement or of any other guarantee of all or any part of the
Guaranteed Obligations;
(iii) any application of the proceeds of any other guarantee
(including without limitation any letter of credit or the obligations of
any other guarantor of all or any part of the Guaranteed Obligations) to
all or any part of the Guaranteed Obligations;
(iv) any release of any other Person (including without limitation any
other guarantor with respect to all or any part of the Guaranteed
Obligations) from any personal liability with respect to all or any part of
the Guaranteed Obligations;
(v) any settlement, compromise, release, liquidation or enforcement,
upon such terms and in such manner as the Administrative Agent and the
Collateral and Paying Agent may determine or as applicable law may dictate,
of all or any part of the Guaranteed Obligations or any other guarantee of
(including without limitation any letter of credit issued with respect to)
all or any part of the Guaranteed Obligations;
(vi) the giving of any consent to the merger or consolidation of, the
sale of substantial assets by, or other restructuring or termination of the
corporate existence of the Borrower or any other Person or any disposition
of any shares of any Guarantor;
(vii) any proceeding against the Borrower or any Guarantor of
(including without limitation any issuer of any letter of credit issued
with respect to) all or any part of the Guaranteed Obligations or any
collateral provided by any other Person or the exercise of any rights,
remedies, powers and privileges of the Administrative Agent, the Collateral
and Paying Agent and the Lenders under the Loan Documents or otherwise in
such order and such manner as the Administrative Agent and the Collateral
and Paying Agent may determine, regardless of whether the Administrative
Agent, the Collateral and Paying
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Agent or the Lenders shall have proceeded against or exhausted any
collateral, right, remedy, power or privilege before proceeding to call
upon or otherwise enforce this Agreement;
(viii) the entering into such other transactions or business dealings
with the Borrower, any Subsidiary or Affiliate of the Borrower or any
Guarantor of all or any part of the Guaranteed Obligations as the
Administrative Agent, the Collateral and Paying Agent or any Lender may
desire; or
(ix) all or any combination of any of the actions set forth in this
Section 7.02(a).
(b) The enforceability and effectiveness of this Agreement and the
liability of the Guarantors, and the rights, remedies, powers and privileges of
the Administrative Agent, the Collateral and Paying Agent and the Lenders under
this Agreement shall not be affected, limited, reduced, discharged or
terminated, and each Guarantor hereby expressly waives to the fullest extent
permitted by law any defense now or in the future arising, by reason of:
(i) the illegality, invalidity or unenforceability of all or any part
of the Guaranteed Obligations, any Loan Document or any other agreement or
instrument whatsoever relating to all or any part of the Guaranteed
Obligations;
(ii) any disability or other defense with respect to all or any part
of the Guaranteed Obligations, including the effect of any statute of
limitations that may bar the enforcement of all or any part of the
Guaranteed Obligations or the obligations of any such other guarantor;
(iii) the illegality, invalidity or unenforceability of any security
for or other guarantee (including without limitation any letter of credit)
of all or any part of the Guaranteed Obligations or the lack of perfection
or continuing perfection or failure of the priority of any Lien on any
collateral for all or any part of the Guaranteed Obligations;
(iv) the cessation, for any cause whatsoever, of the liability of the
Borrower or any Guarantor with respect to all or any part of the Guaranteed
Obligations (other than, subject to Section 7.03 hereof, by reason of the
full payment of all Guaranteed Obligations);
(v) any failure of the Administrative Agent, the Collateral and Paying
Agent or any Lender to marshal assets in favor of the Borrower or any other
Person (including any other guarantor of all or any part of the Guaranteed
Obligations), to exhaust any collateral for all or any part of the
Guaranteed Obligations, to pursue or exhaust any right, remedy, power or
privilege it may have against the Borrower or any other guarantor of all or
any part of the Guaranteed Obligations (including any issuer of any letter
of credit) or any other Person or to take any action whatsoever to mitigate
or reduce such or any other Person's liability under this Agreement, the
Administrative Agent, the Collateral and Paying Agent and the Lenders being
under no obligation to take any such action notwithstanding the fact that
all or any part of the Guaranteed Obligations may be due
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and payable and that the Borrower may be in default of its obligations
under any Loan Document;
(vi) any counterclaim, set-off or other claim which the Borrower or
any Guarantor of all or any part of the Guaranteed Obligations has or
claims with respect to all or any part of the Guaranteed Obligations;
(vii) any failure of the Administrative Agent, the Collateral and
Paying Agent or any Lender or any other Person to file or enforce a claim
in any bankruptcy or other proceeding with respect to any Person;
(viii) any bankruptcy, insolvency, reorganization, concurso mercantil,
winding-up or adjustment of debts, or appointment of a custodian,
interventor, conciliador, sindico, liquidator or the like of it, or similar
proceedings commenced by or against any Person, including any discharge of,
or bar or stay against collecting, all or any part of the Guaranteed
Obligations (or any interest on all or any part of the Guaranteed
Obligations) in or as a result of any such proceeding;
(ix) any action taken by the Administrative Agent, the Collateral and
Paying Agent or any Lender that is authorized by this Section 7.02 or
otherwise in this Agreement or by any other provision of any Loan Document
or any omission to take any such action; or
(x) to the fullest extent permitted by applicable law, any other
circumstance whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor.
(c) To the fullest extent permitted by law, each Guarantor expressly
waives, for the benefit of the Administrative Agent, the Collateral and Paying
Agent and the Lenders, all set-offs and counterclaims and all diligence,
presentment, demand for payment or performance, notices of nonpayment or
nonperformance, protest, notices of protest, notices of dishonor and all other
notices or demands of any kind or nature whatsoever (other than the written
demand for payment pursuant to Section 7.01 hereof), and any requirement that
the Administrative Agent, the Collateral and Paying Agent or any Lender exhaust
any right, power or remedy or proceed against the Borrower under this Agreement,
any Note or any other Loan Document or other agreement or instrument referred to
herein or therein, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations, and all notices of acceptance
of this Agreement or of the existence, creation, incurring or assumption of new
or additional Guaranteed Obligations. Each Guarantor further expressly waives
the benefit of any and all statutes of limitation, to the fullest extent
permitted by applicable law.
(d) Each Guarantor further waives, to the fullest extent permitted by
law, any right to which it may be entitled, including, without limitation:
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(i) that the assets of the Borrower first be used, depleted and/or
applied in satisfaction of the Borrower's obligations under this Agreement
prior to any amounts being claimed from or paid by any Guarantor;
(ii) to require that the Borrower be sued and all claims against the
Borrower be completed prior to an action or proceeding being initiated
against such Guarantor;
(iii) to have its obligations hereunder be divided among the
Guarantors, such that each Guarantor's obligation would be less than the
full amount claimed; and
(iv) to the extent applicable, under Articles 2814, 2815, 2816, 2817,
2818, 2819, 2820, 2821, 2822, 2823, 2842, 2845 and 2846 of the Federal
Civil Code and the correlative rights of the Civil Codes of the Federal
District and the States of Mexico.
7.03 Reinstatement. The obligations of each Guarantor under this
Section 7 shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of the Borrower in respect of the Guaranteed
Obligations is rescinded or must otherwise be restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise, and the Guarantors jointly and severally agree
that they will indemnify the Administrative Agent, the Collateral and Paying
Agent and the Lenders on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees of counsel, but without
duplication of the obligations of the Borrower under this Agreement) incurred by
them in connection with such rescission or restoration, including any such costs
and expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or the like under any bankruptcy,
insolvency or similar law.
7.04 Subrogation. The Guarantors hereby jointly and severally agree
that, until the final payment in full of all Guaranteed Obligations and the
expiration or termination of the Commitments under this Agreement, they shall
not exercise any right or remedy arising by reason of any performance by any of
them of their guarantee in Section 7.01 hereof, whether by subrogation,
reimbursement, contribution or otherwise, against the Borrower or any other
guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations.
7.05 Remedies. Each Guarantor agrees that, as between such Guarantor
and the Administrative Agent, the Collateral and Paying Agent and the Lenders,
the obligations of the Borrower under this Agreement, the Notes or any other
Loan Documents may be declared to be forthwith due and payable as provided in
Section 11 hereof (and shall be deemed to have become automatically due and
payable in the circumstances provided in said Section 11) for purposes of
Section 7.01 hereof, notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against the Borrower and that, in the event of such declaration
(or such obligations being deemed to have become automatically due and payable),
such obligations (whether or not due and payable by the Borrower) shall
forthwith become due and payable by such Guarantor for purposes of said Section
7.01.
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7.06 Payments. All payments by the Guarantors under this Agreement
shall be made in Dollars, without deduction, set-off or counterclaim at the
place specified in Section 4 hereof and free and clear of any and all present
and future Covered Taxes, without prejudice to what is set forth in Section 5.05
above.
7.07 Rights of Contribution. The Guarantors hereby agree, as between
themselves, that if any Guarantor shall become an Excess Funding Guarantor (as
defined below) by reason of the payment by such Guarantor of any of the
Guaranteed Obligations, each other Guarantor shall, on written demand of such
Excess Funding Guarantor (but subject to the next sentence), pay to such Excess
Funding Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined
below and determined, for this purpose, without reference to the Properties,
debts and liabilities of such Excess Funding Guarantor) of said payment of the
Guaranteed Obligations. The payment obligation of a Guarantor to any Excess
Funding Guarantor under this Section 7.07 shall be subordinate and subject in
right of payment to the prior payment in full of the obligations of such
Guarantor under the provisions of Section 7.01 and such Excess Funding Guarantor
shall not exercise any right or remedy with respect to such excess until payment
and satisfaction in full of all of such obligations.
For purposes of this Section 7.07, (i) "Excess Funding Guarantor"
shall mean, in respect of any Guaranteed Obligations, a Guarantor that has paid
an amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii)
"Excess Payment" shall mean, in respect of any Guaranteed Obligations, the
amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of
such Guaranteed Obligations and (iii) "Pro Rata Share" shall mean, for any
Guarantor, the ratio (expressed as a percentage) of (x) the amount by which the
aggregate fair saleable value of all Properties of such Guarantor (excluding any
shares of stock of any other Guarantor) exceeds the amount of all the debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured and
unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder and any obligations of any other Guarantor that have been Guaranteed
by such Guarantor) to (y) the amount by which the aggregate fair saleable value
of all Properties of the Guarantors exceeds the amount of all debts and
liabilities (including contingent, subordinated, unmatured and unliquidated
liabilities, but excluding the obligations of the Borrower and the Guarantors
hereunder) of all of the Guarantors, determined as of the date hereof.
7.08 General Limitation on Guarantee Obligations. To the extent that
the obligations of any Guarantor hereunder would, by reason of any applicable
domestic or foreign law, rule or regulation (including any domestic or foreign
corporate law, or any domestic or foreign bankruptcy, insolvency, reorganization
or other law affecting the rights of creditors generally) be held or determined
to be void, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability hereunder, then,
notwithstanding any other provision hereof to the contrary, the amount of such
liability shall, without any further action by such Guarantor, any Lender, the
Administrative Agent or any other Person, be automatically limited and reduced
to the highest amount that is valid and enforceable and not subordinated to the
claims of other creditors.
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SECTION 8. REPRESENTATIONS AND WARRANTIES. Each of the Borrower and
each Guarantor represents and warrants to the Administrative Agent, the
Collateral and Paying Agent and the Lenders with respect to itself (except as
otherwise provided herein) that, as of the date hereof and as of the date of
each Borrowing (unless otherwise specified):
8.01 Power and Authority. It (a) is a corporation or a sociedad
anonima de capital variable duly organized and validly existing under the laws
of its jurisdiction of incorporation, (b) has all requisite corporate power, and
has all material governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being conducted,
(c) is qualified to do business and is in good standing in all jurisdictions in
which the nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could (either individually or in the
aggregate) reasonably be expected to have a Material Adverse Effect, (d) has the
power and authority to make and perform each of the Loan Documents to which it
is a party and, in the case of VENA and Vitro Packaging, the Intercompany Notes,
and to borrow the Loans hereunder, (e) is in compliance with all applicable
material laws and regulations, and (f) has good title to all its assets, free
and clear of any Liens except as expressly permitted by this Agreement.
8.02 Due Authorization, Etc. The making and performance by it of the
Loan Documents to which it is a party and, in the case of VENA and Vitro
Packaging, the Intercompany Notes, and all other documents and instruments to be
executed and delivered by it hereunder have been duly authorized by all
necessary corporate action, and do not contravene (a) its estatutos sociales or,
if applicable, other constitutive documents, or (b) any Requirement of Law, or
(c) any agreement or instrument or material contractual restriction binding on
or affecting it or any of its Property, and do not and will not result in the
imposition of any Lien on any of its Property, except Liens created or arising
under the Loan Documents. No part of the proceeds of the Loans will be used to
buy or carry any "margin stock" within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System (and no Indebtedness refinanced with
the proceeds of the Loans will have been used to buy or carry any such "margin
stock").
8.03 Governmental and Other Approvals. No license, consent,
authorization or approval or other action by, or notice to or filing or
registration with, any Governmental Authority (including without limitation any
foreign exchange approval), and no other third-party consent or approval, is
necessary for the due execution, delivery and performance by it of the Loan
Documents or for the legality, validity or enforceability thereof against it. No
filing, registration or other action is required to be accomplished under
Mexican law in order to cause the security interest created by each Security
Agreement in the Collateral referred to therein to be a valid first and prior
perfected security interest therein.
8.04 Legal Effect. This Agreement has been duly executed and delivered
by the Borrower and the Guarantors, the Vidriera Security Agreement has been
duly executed and delivered by the Borrower, the Vitro Packaging Security
Agreement has been duly executed and delivered by Vitro Packaging and each
thereof is, and each Note when duly executed and
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delivered by the Borrower for value received, and endorsed "por aval" by each
Guarantor, will be the legal, valid and binding obligation of the Borrower and
the Guarantors, as the case may be, enforceable against them in accordance with
its terms.
8.05 Financial Statements. The respective consolidated balance sheets
of the Borrower and its consolidated Subsidiaries as of December 31, 2000 and of
each of VENA, Vitro and Vitro Packaging and their respective consolidated
Subsidiaries as of December 31, 2000, and the related consolidated statements of
income and cash flows for the fiscal year ending on that date, each of which has
heretofore been furnished to the Lenders, are complete and correct and fairly
present the consolidated financial condition of the Borrower and its
consolidated Subsidiaries and VENA, Vitro and Vitro Packaging and their
respective consolidated Subsidiaries as at said respective dates and the
consolidated results of their respective operations for the fiscal year ending
on said date, all in accordance with GAAP, and neither the Borrower and its
Subsidiaries nor VENA, Vitro and Vitro Packaging and their respective
Subsidiaries have material contingent liabilities or unusual forward or
long-term commitments not disclosed therein. Since December 31, 2000, no event
or circumstance has occurred that has had a Material Adverse Effect.
8.06 Ranking. The payment obligations of the Borrower and each
Guarantor hereunder are and will at all times be unconditional and
unsubordinated general obligations of the Borrower and each Guarantor, and rank
and will at all times rank at least pari passu with all other present and future
unsecured Indebtedness of the Borrower and each Guarantor, except that in any
bankruptcy proceeding initiated in Mexico, pursuant to the laws of Mexico, labor
claims, claims of tax authorities for unpaid taxes, IMSS quotas, INFONAVIT
quotas and SAR Fund quotas will have priority over claims of the Administrative
Agent, the Collateral and Paying Agent and the Lenders.
8.07 No Actions or Proceedings. There is no litigation, investigation
or proceeding pending or, to the best of its knowledge, threatened against it or
any of its Subsidiaries by or before any Governmental Authority that (either
individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect. Its operations and those of its Subsidiaries comply
with all applicable Environmental Laws, except to the extent the failure to so
comply (either individually or in the aggregate) could not reasonably be
expected to have a Material Adverse Effect.
8.08 Commercial Activity; Absence of Immunity. It is subject to civil
and commercial law with respect to its obligations under the Loan Documents, and
the making and performance by it of the Loan Documents constitute private and
commercial acts rather than public or governmental acts. It is not entitled to
any immunity on the ground of sovereignty or the like from the jurisdiction of
any court or from any action, suit, set-off or proceeding, or the service of
process in connection therewith, arising under the Loan Documents.
8.09 Taxes. There is no income, stamp or other similar tax, levy,
assessment, impost, deduction, charge or withholding imposed by Mexico (or any
municipality or other political subdivision or taxing authority thereof or
therein that exercises power to impose such tax, levy, assessment, impost,
deduction, charge or withholding) either (a) on or by virtue of the
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execution or delivery of the Loan Documents or (b) on any payment to be made by
the Borrower or any Guarantor pursuant to the Loan Documents, other than any
such tax, levy, assessment, impost, deduction, charge or withholding imposed on
any Person as a result of such Person being organized under the laws of Mexico
or by virtue of its having a permanent establishment or fixed base in Mexico to
which income under this Agreement and the Notes is attributable or its
Applicable Lending Office being located in Mexico, except for withholding tax on
payments of interest and fees deemed to be interest to Lenders that are not
Mexican Banks. It has filed all material tax returns required to be filed and
paid all taxes shown to be due thereon except such as are being contested in
good faith by appropriate proceedings and for which adequate reserves have been
made if required in accordance with GAAP.
8.10 Legal Form. This Agreement and the other Loan Documents to which
it is a party and, in the case of VENA and Vitro Packaging, the Intercompany
Notes are in proper legal form under the laws of Mexico for the enforcement
thereof against it under such law. All formalities required in Mexico for the
validity and enforceability of each of the Loan Documents and the Intercompany
Notes have been satisfied, and no Covered Taxes are required to be paid and no
notarization is required, for the validity and enforceability thereof; provided,
that in the event any legal proceedings are brought in the courts of Mexico, a
Spanish translation of the documents required in such proceedings needs to be
prepared by a court-approved translator and would have to be approved by such
court after the defendant had been given an opportunity to be heard with respect
to the accuracy of the translation, and proceedings would thereafter be based
upon the translated documents.
8.11 Full Disclosure. The information, reports, financial statements,
exhibits and schedules contained in the Information Memorandum, taken as a
whole, do not contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading on the date as of which
such information is stated or certified; and if any of such information,
reports, financial statements, exhibits and schedules shall become materially
untrue or misleading on or before the Borrowing Date, it shall promptly inform
the Administrative Agent thereof, provided, that no such representation and
warranty is made as to any projections or forward looking information contained
therein except that such projections or forward looking information have been
prepared in good faith on assumptions believed to be reasonable at the time of
preparation thereof. All other written information furnished after the date
hereof by the Borrower or any Guarantor to the Administrative Agent and the
Lenders in connection with this Agreement and the transactions contemplated
hereby will be true, complete and accurate in every material respect, or (in the
case of projections, if applicable) based on reasonable estimates, on the date
as of which such information is stated or certified.
8.12 Liens. Schedule 4 hereto is a complete and correct list of each
security interest granted by the Borrower in connection with any Indebtedness as
of the date hereof.
8.13 Solvency. It is, and after giving effect to the making of the
Loans and the use of proceeds thereof (including without limitation the
incurrence of the Guaranteed Obligations) will be, Solvent.
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8.14 Restrictions on Upstreaming. Other than the Existing
Restrictions, no Subsidiary of the Borrower or any Guarantor is subject on the
date hereof to any contractual restriction on its ability to make any Dividend
Payment.
8.15 Not an Investment Company. It is not required to register as an
"investment company" under the Investment Company Act of 1940, as amended.
8.16 Collateral. The security interest created by each Security
Agreement constitutes a valid first priority Lien on and prior perfected
security interest in the Collateral referred to therein, subject to no equal or
prior Lien.
SECTION 9. COVENANTS OF THE BORROWER. The Borrower covenants and
agrees with the Lenders and each Agent that, so long as any Commitment or Loan
is outstanding and until payment in full of all amounts payable by the Borrower
hereunder and under the other Loan Documents:
9.01 Corporate Existence, Etc. The Borrower will, and will cause each
of its Subsidiaries to, (a) preserve and maintain its corporate existence and
all of its material rights and licenses, (b) maintain appropriate accounting and
corporate books and records, and (c) permit representatives of any Lender, the
Collateral and Paying Agent or the Administrative Agent, during normal business
hours, at their own cost and expense (provided, that if an Event of Default has
occurred and is continuing the Borrower shall indemnify each Lender, the
Collateral and Paying Agent and the Administrative Agent for such costs and
expenses, if reasonable and documented) and following notice given within a
reasonable number of days, to examine, copy and make extracts from its
accounting and corporate books and records, to inspect any of its Property, and
to discuss its business and affairs with its officers, to the extent reasonably
requested by such Lender (through the Administrative Agent), the Collateral and
Paying Agent or the Administrative Agent (as the case may be).
9.02 Compliance with Law. The Borrower will, and will cause each of
its Subsidiaries to, (a) comply with the requirements of all material applicable
laws, rules, regulations and orders (including without limitation all
Environmental Laws) of Governmental Authorities (including without limitation
IMSS, INFONAVIT and SAR), (b) timely file all required material tax returns and
pay and discharge at or before maturity all of its material obligations
(including without limitation tax liabilities, except where the same are
contested in good faith and by appropriate proceedings and against which
adequate reserves are being maintained if and to the extent required by GAAP and
where the failure to pay or discharge such obligations or liabilities would not
result in a Material Adverse Effect), (c) maintain all of its material Property
used or useful in its business in good working order and condition, ordinary
wear and tear excepted, and (d) maintain insurance in respect of its and its
Subsidiaries' Property and businesses against loss and damage of the kinds and
in the amounts customary in the industry in which the Borrower and its
Subsidiaries operate.
9.03 Governmental Authorizations. The Borrower will promptly from time
to time obtain and maintain in full force and effect all licenses, consents,
authorizations and
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approvals of, and make all filings and registrations with, any Governmental
Authority necessary under the laws of Mexico for the making and performance by
it of the Loan Documents.
9.04 Financial Statements, Etc. The Borrower will provide to the
Administrative Agent for distribution to the Lenders:
(a) as soon as available and in any event within 120 days after the
end of each fiscal year of the Borrower, enough copies for each Lender of
the consolidated balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such fiscal year and the related consolidated
statements of income and cash flows of the Borrower and its consolidated
Subsidiaries for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all reported on
in conformity with GAAP, with the unqualified opinion thereon of the
Mexican office of Deloitte & Touche or other independent public accountants
of recognized international standing;
(b) as soon as available and in any event within 60 days after the end
of each quarter of each fiscal year of the Borrower, enough copies for each
Lender of an unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of each such fiscal quarter and the
related consolidated statements of income and cash flow of the Borrower and
its consolidated Subsidiaries for such quarter and for the period from the
beginning of the then current fiscal year to the end of such quarter,
setting forth in each case in comparative form the figures for the
corresponding quarter in the previous fiscal year, all certified as to
fairness of presentation and conformity with GAAP by the Responsible
Officer of the Borrower;
(c) within fifteen Business Days after the last day of each fiscal
quarter of the Borrower, a certificate of the Responsible Officer of the
Borrower, in the form of Exhibit L, (y) setting forth in reasonable detail
the calculations required to establish whether the Borrower was in
compliance with the requirements of Section 9.11 hereof, and certifying the
Borrower's Debt Service Coverage Ratio, in each case on and as of the date
of such financial statements and (z) stating whether any Default exists on
the date of such certificate and, if any Default then exists, setting forth
the details thereof and the action which the Borrower is taking or proposes
to take with respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements as to
whether anything has come to their attention to cause them to believe that
any Default existed on the date of such statements;
(e) promptly upon an officer of the Borrower obtaining knowledge of
the occurrence of any Default, a certificate of the Responsible Officer of
the Borrower setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;
(f) promptly upon the commencement of, or any material adverse
development in, any litigation or proceeding against the Borrower or any of
its Subsidiaries that could
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reasonably be expected to have a Material Adverse Effect, notice thereof
with a description thereof in reasonable detail;
(g) promptly upon receipt by the Borrower of any payment or prepayment
of any Intercompany Note, notice thereof specifying the amount and date of
such payment or prepayment; and
(h) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Administrative Agent, at the request of any Lender, may reasonably request.
9.05 Ranking. The Borrower will promptly take all actions as may be
necessary to ensure that the payment obligations of the Borrower under this
Agreement and the Notes will at all times constitute unconditional and
unsubordinated general obligations of the Borrower ranking at least pari passu
with all other present and future unsecured and unsubordinated Indebtedness of
the Borrower, except that in any bankruptcy proceeding initiated in Mexico,
pursuant to the laws of Mexico, labor claims, claims of tax authorities for
unpaid taxes, IMSS quotas, INFONAVIT quotas and SAR Fund quotas will have
priority over claims of the Administrative Agent, the Collateral and Paying
Agent and the Lenders (and other than as otherwise provided in Section 9.13
hereof).
9.06 Maintenance of Collection Account and Reserve Account. The
Borrower shall at all times maintain ownership, free and clear of any Lien, of
the Collection Account and the Reserve Account, except for the Liens created
hereby or by the Vidriera Security Agreement.
9.07 Transactions With Affiliates. Without prejudice to anything
expressly permitted under this Agreement, the Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly enter into any
transaction with an Affiliate thereof, except in the ordinary course of and
pursuant to the reasonable requirements of its business and upon commercially
reasonable terms that are no less favorable to it than those which would be
obtainable in a comparable arm's-length transaction at the time from a Person
which is not such an Affiliate.
9.08 Line of Business. The Borrower will not make any material change
in the line of business of the Borrower and its Subsidiaries as conducted on the
date hereof, and it will not change the legal nature of its organization.
9.09 Upstreaming. The Borrower will not after the date hereof permit
any of its Subsidiaries to enter into, create or assume any contractual
restriction on the ability of such Subsidiary to make any Dividend Payment.
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9.10 Hedge Agreements. The Borrower will not, and will not permit any
of its Subsidiaries to, enter into any Hedge Agreement, other than Hedge
Agreements entered into (i) in the ordinary course of business to hedge or
mitigate risks to which the Borrower or any of its Subsidiaries is exposed in
the conduct of its business or the management of its liabilities and (ii) not
for speculative purposes.
9.11 Collections of Eligible Receivables. The Borrower will assure
that the aggregate amount collected in respect of Eligible Receivables during
each period of four consecutive fiscal quarters of the Borrower is not less than
$115,000,000 and will assure that, at all times, the accounts receivable arising
from the sale of goods exported to Vitro Packaging by the Borrower will be
denominated in Dollars.
9.12 Collateral. The Borrower will take all reasonable steps requested
by the Administrative Agent to cause the security interest created by the
Vidriera Security Agreement to be at all times a valid first Lien on and prior
perfected security interest in the Collateral referred to therein, subject to no
equal or prior Lien.
9.13 Negative Pledge. The Borrower will not, and will not permit any
of its Subsidiaries to, create, assume or suffer to exist any Lien on its
Property, whether now owned or hereafter acquired by it, except:
(i) Permitted Liens;
(ii) Liens (not covering any of the Collateral) existing on the date
hereof and described in Schedule 4 hereto;
(iii) Liens on any Property of the Borrower or any of its Subsidiaries
securing Indebtedness of the Borrower or any of its Subsidiaries incurred
or assumed for the purpose of financing (1) all or any part of the cost of
acquiring such Property or (2) all or part of the cost of constructing such
Property or improvements on or of any such Property, provided, that such
Lien attaches to such Property concurrently with or within 60 days after
the acquisition thereof;
(iv) Liens (not covering any shares of capital stock of such Person)
not otherwise permitted by the foregoing clauses, securing Indebtedness
outstanding at any time in an aggregate principal amount not exceeding
$10,000,000; and
(v) Liens created hereunder or under the Vidriera Security Agreement.
9.14 Fiscal Year. The Borrower will not, and will not permit any of
its Subsidiaries to, change its fiscal year from a calendar year ending December
31.
9.15 Intercompany Notes. As a condition precedent to or simultaneously
with the making by the Borrower of each intercompany loan to VENA and Vitro
Packaging referred to in Section 2.01(b) hereof, the Borrower will obtain a
valid promissory note of Vitro Packaging or of VENA (a ▇▇▇▇▇▇) in a principal
amount equal to the amount of such intercompany loan and
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in form and substance to the Administrative Agent (each, an "Intercompany
Note"), and will forthwith deliver the same to the Administrative Agent, duly
endorsed.
SECTION 10. COVENANTS OF THE GUARANTORS. Each Guarantor covenants and
agrees with the Lenders, the Collateral and Paying Agent and the Administrative
Agent that, so long as any Commitment or Loan is outstanding and until payment
in full of all amounts payable by the Borrower hereunder and under the other
Loan Documents:
10.01 Corporate Existence, Etc. Each Guarantor other than Vitro will,
and will cause each of its Subsidiaries to, and Vitro will, and will cause each
of its Material Subsidiaries (other than for Section 10.01(c) hereof, those
Subsidiaries of Vitro which are joint ventures) to, (a) preserve and maintain
its corporate existence and all of its material rights and licenses, (b)
maintain appropriate accounting and corporate books and records, and (c) permit
representatives of any Lender, the Collateral and Paying Agent or the
Administrative Agent, during normal business hours, at their own cost and
expense (provided, that if a Default has occurred and is continuing such
Guarantor shall indemnify each Lender, the Collateral and Paying Agent and the
Administrative Agent for such costs and expenses if reasonable and documented)
and following notice given within a reasonable number of days, to examine, copy
and make extracts from its accounting and corporate books and records, to
inspect any of its Property, and to discuss its business and related affairs
with its officers, to the extent reasonably requested by such Lender (through
the Administrative Agent), the Collateral and Paying Agent or the Administrative
Agent (as the case may be).
10.02 Compliance with Law. Each Guarantor other than Vitro will, and
will cause each of its Subsidiaries to, and Vitro will, and will cause each of
its Material Subsidiaries to, (a) comply with the requirements of all material
applicable laws, rules, regulations and orders (including without limitation all
Environmental Laws) of Governmental Authorities (including without limitation
IMSS, INFONAVIT and SAR and all laws relating to Social Security), (b) timely
file all required material tax returns and pay and discharge at or before
maturity all of its material obligations (including without limitation tax
liabilities, except where the same are contested in good faith and by
appropriate proceedings and against which adequate reserves are being maintained
if and to the extent required by GAAP and where the failure to pay or discharge
such obligations or liabilities would not result in a Material Adverse Effect),
(c) maintain all of its material Property used or useful in its business in good
working order and condition, ordinary wear and tear excepted, and (d) maintain
insurance in respect of its and its Subsidiaries' Property and businesses
against loss and damage of the kinds and in the amounts customary in the
industry in which such Guarantor and its Subsidiaries operate.
10.03 Governmental Authorizations. It will promptly from time to time
obtain and maintain in full force and effect all licenses, consents,
authorizations and approvals of, and make all filings and registrations with,
any Governmental Authority necessary under the laws of Mexico for the making and
performance by it of the Loan Documents to which it is a party and, in the case
of VENA and Vitro Packaging, the Intercompany Notes.
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10.04 Financial Statements, Etc. Vitro, Vitro Packaging, VENA and the
VENA Leasing Companies will each provide to the Administrative Agent for
distribution to the Lenders:
(a) as soon as available and in any event within 120 days after the
end of each fiscal year, enough copies for each Lender of the consolidated
balance sheets of it and its consolidated Subsidiaries as at the end of
such fiscal year and the related consolidated statements of income and cash
flows of it and its consolidated Subsidiaries for such fiscal year, setting
forth in each case in comparative form the figures for the previous fiscal
year, all reported on in conformity with GAAP, with the unqualified opinion
thereon of independent public accountants of recognized international
standing acceptable to the Majority Lenders;
(b) as soon as available and in any event within 60 days after the end
of each quarter of each fiscal year, enough copies for each Lender of an
unaudited consolidated balance sheet of it and its consolidated
Subsidiaries as at the end of each such fiscal quarter and the related
consolidated statements of income and cash flow of it and its consolidated
Subsidiaries for such quarter and for the period from the beginning of the
then current fiscal year to the end of such quarter, setting forth in each
case in comparative form the figures for the corresponding quarter in the
previous fiscal year, all certified as to fairness of presentation and
conformity with GAAP by the Responsible Officer of such entity;
(c) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, and at any other time
reasonably requested by the Administrative Agent, a certificate of the
Responsible Officer of (x) VENA, in the form of Exhibit N, setting forth in
reasonable detail the calculations required to establish whether VENA was
in compliance with the requirements of Sections 10.08, 10.09 and 10.10
hereof and (y) Vitro, in the form of Exhibit O, setting forth in reasonable
detail the calculations required to establish whether Vitro was in
compliance with the requirements of Section 10.13 hereof on the date of
such financial statements; in each case stating whether any Default exists
on the date of such certificate and, if any Default then exists, setting
forth the details thereof and the action which such Guarantor is taking or
proposes to take with respect thereto;
(d) within fifteen Business Days after the last day of each fiscal
quarter of Vitro Packaging, a certificate of the Responsible Officer of
Vitro Packaging, in the form of Exhibit M, setting forth in reasonable
detail the calculations required to establish whether Vitro Packaging was
in compliance with the requirements of Section 10.11 hereof as of the last
day of such fiscal quarter;
(e) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements as to
whether anything has come to their attention to cause them to believe that
any Default existed on the date of such statements;
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(f) promptly upon an officer of such Guarantor obtaining knowledge of
the occurrence of any Default, a certificate of the Responsible Officer of
such Guarantor setting forth the details thereof and the action which such
Guarantor is taking or proposes to take with respect thereto;
(g) promptly upon the commencement of, or any material adverse
development in, any litigation or proceeding against any Guarantor or any
of its Subsidiaries that could reasonably be expected to have a Material
Adverse Effect, notice thereof with a description thereof in reasonable
detail;
(h) at any time when securities of any Guarantor or any of its
Subsidiaries are held by the public, promptly upon the delivery or filing
thereof, copies of all reports and registration statements that such
Guarantor or such Subsidiary files with the Securities and Exchange
Commission of the United States of America or the Comision Nacional
Bancaria y de Valores or any Mexican or other securities authority or
exchange; and
(i) from time to time such additional information regarding the
financial position or business of the Guarantors as the Administrative
Agent, at the request of any Lender, may reasonably request.
10.05 Ranking. It will promptly take all actions as may be necessary
to ensure that the payment obligations of such Guarantor under this Agreement
will at all times constitute unconditional and unsubordinated general
obligations of such Guarantor ranking at least pari passu in priority of payment
with all other present and future unsecured and unsubordinated Indebtedness of
such Guarantor, except that in any bankruptcy proceeding initiated in Mexico,
pursuant to the laws of Mexico, labor claims, claims of tax authorities for
unpaid taxes, IMSS quotas, INFONAVIT quotas and SAR Fund quotas will have
priority over claims of the Administrative Agent, the Collateral and Paying
Agent and the Lenders, and other than as provided in Section 10.15 hereof.
10.06 Dividend Payments. VENA will not make any Dividend Payment if,
at the time of such Dividend Payment and immediately after giving effect
thereto, (i) the VENA Debt to EBITDA Ratio is greater than 2.0 to 1.0 or (ii)
the making of such Dividend Payment would result in an Event of Default;
provided, that this restriction shall not be deemed to prohibit any Subsidiary
of VENA that is a joint venture from making Dividend Payments that it is
contractually obligated to make pursuant to agreements in effect on the date
hereof and heretofore disclosed to the Banks in writing.
10.07 Use of Dividend Payments. VENA will not apply any Dividend
Payments received by it directly or indirectly from the Borrower to make any
loan or any extension of credit to, or any Investment in, any of its
Subsidiaries, except that the provisions of this Section 10.07 shall not apply
to loans or extensions of credit to or Investments in the Borrower or such of
VENA's Subsidiaries as are also Guarantors.
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10.08 Consolidated Net Worth. VENA will not permit its Consolidated
Net Worth to be less than the following respective amounts on each of the dates
set forth below:
Period Amount
---------------------- -----------
December 31, 2001 $90,000,000
December 31, 2002 $90,000,000
December 31, 2003 $100,000,000
December 31, 2004 $110,000,000
December 31, 2005 $125,000,000.
10.09 VENA Interest Coverage Ratio. VENA will not permit the VENA
Interest Coverage Ratio to be less than the ratio set forth below for the
respective fiscal years set forth below:
Period Ratio
From the Closing Date
through December 31, 2001 1.50 to 1.00
From January 1, 2002
through December 31, 2002 1.60 to 1.00
From January 1, 2003
through December 31, 2003 2.00 to 1.00
From January 1, 2004
through December 31, 2004 2.15 to 1.00
From January 1, 2005
through the Final Maturity Date 2.35 to 1.00.
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10.10 VENA Debt to EBITDA Ratio. VENA will not permit the VENA Debt to
EBITDA Ratio to be greater than the ratio set forth below for the respective
fiscal years set forth below:
Period Ratio
From the Closing Date
through December 31, 2001 4.25 to 1.00
From January 1, 2002
through December 31, 2002 3.75 to 1.00
From January 1, 2003
through December 31, 2003 3.50 to 1.00
From January 1, 2004
through December 31, 2004 3.00 to 1.00
From January 1, 2005
through the Final Maturity Date 2.75 to 1.00.
10.11 Vitro Packaging Debt Service Coverage Ratio. Vitro Packaging
will at all times assure that the Vitro Packaging Debt Service Coverage Ratio is
maintained at not less than 2.00 to 1.00.
10.12 Dispositions. (a) Neither the Borrower nor VENA will, nor will
it permit any of its Subsidiaries to, directly or indirectly, make any
Disposition of Property of the Borrower, VENA and their respective Subsidiaries
if the market value of the Property subject to such Disposition, when added to
the aggregate market value of all other Dispositions of Property of the
Borrower, VENA and their respective Subsidiaries occurring after the date hereof
and prior to the Final Maturity Date (which shall not include the excepted
Dispositions set forth below and as set forth in subsection (b) of this Section
10.12), would exceed an amount equal to 10% of the aggregate fair market value
of the Property of VENA and its consolidated Subsidiaries on a consolidated
basis as of the end of the then most recently concluded fiscal quarter of the
Borrower; provided, however, that the net amounts received by the Borrower or
VENA or such Subsidiary in respect of such Dispositions allowed under this
Section 10.12(a) shall be used to repay Indebtedness of the Borrower, VENA or
such Subsidiary, and provided further, that the limitation set forth above shall
not apply to:
(A) Dispositions of inventory for fair value in the ordinary course of
business,
(B) sales of accounts receivable in factoring arrangements existing on
the date hereof (including renewals and replacements thereof to the extent
the amount thereof is not increased beyond a total aggregate principal
amount of $55,000,000),
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(C) Dispositions of Property no longer used or, in the reasonable
opinion of the Borrower, useful in the business of the Borrower or its
Subsidiaries, provided that the net proceeds of any such Disposition shall
be reinvested in the business of the Borrower or the relevant Subsidiary or
used to repay Indebtedness thereof within 30 days of said Disposition, and
(D) Dispositions of up to 9% of the total outstanding Voting Shares of
Vitro OCF as set forth in clause (iv) of the definition of "Change of
Control".
(b) VENA will not make, directly or indirectly, any Disposition of any
of the shares of capital stock of any of the VENA Leasing Companies directly or
indirectly owned by VENA on the date hereof; provided, that VENA may make a
Disposition for cash (except to the extent contemplated under subsection (ii)
below) of all, but not less than all, of the shares of Vidriera Mexicali, to
(i) a Person (other than an Affiliated Person) on an arm's-length
basis for fair market value (as determined by an independent appraiser
mutually acceptable to the Borrower and the Lenders) and, upon such sale,
Vidriera Mexicali, shall be simultaneously released from its obligations
hereunder, so long as the Net Proceeds of any such Disposition (or, if
applicable, the Dollar equivalent thereof) are applied when received to the
prepayment of Loans hereunder in accordance with Section 3.04(b)(i) hereof
or
(ii) an Affiliated Person on an arm's-length basis for fair market
value (as determined by an independent appraiser mutually acceptable to the
Borrower and the Lenders) and, upon such sale, Vidriera Mexicali, shall be
simultaneously released from its obligations hereunder, so long as the Net
Proceeds of any such Disposition (or, if applicable, the Dollar equivalent
thereof) are applied when received to the prepayment of Loans hereunder in
accordance with Section 3.04(b)(ii) hereof.
10.13 Indebtedness. Vitro will not and will not permit any of its
Consolidated Subsidiaries to incur any Indebtedness unless, immediately after
giving effect to the incurrence of such Indebtedness and the receipt and
application of the proceeds therefrom, the ratio of (1) the aggregate
outstanding principal amount of Indebtedness of Vitro and its Consolidated
Subsidiaries on a consolidated basis to (2) the Consolidated EBITDA of Vitro for
the most recently concluded period of four consecutive fiscal quarters of Vitro
would be greater than zero and less than or equal to 4.25 to 1.00 on the date of
such incurrence, provided that this covenant shall not apply to:
(i) Indebtedness of Vitro or such Consolidated Subsidiaries to the
extent it refinances Indebtedness otherwise permitted hereunder, other than
Indebtedness incurred under clause (ii) of this Section 10.13;
(ii) Indebtedness of Vitro or such Consolidated Subsidiaries incurred
for working capital needs in the ordinary course of business or to
refinance interest expense, in an aggregate principal amount at any time
outstanding not to exceed $300,000,000;
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(iii) Indebtedness incurred under any Loan Document;
(iv) Indebtedness (A) in respect of performance, surety or appeal
bonds provided in the ordinary course of business, (B) under currency
agreements and interest rate agreements (provided that, in the case of
currency agreements that relate to other Indebtedness, such currency
agreements do not increase the Indebtedness of the obligor outstanding at
any time other than as a result of fluctuations in foreign currency
exchange rates or by reason of fees, indemnities and compensation payable
thereunder) and (C) arising from agreements providing for indemnification,
adjustment of purchase price or similar obligations, or from Guarantees or
letters of credit, surety bonds, performance bonds or other similar
instruments securing any obligations of Vitro or any of its Consolidated
Subsidiaries pursuant to such agreements, in any case incurred in
connection with the disposition of any business, assets or Consolidated
Subsidiary (other than a Guarantee incurred by any Person acquiring all or
any portion of such business, assets or Consolidated Subsidiary for the
purpose of financing such acquisition), in a principal amount not to exceed
the gross proceeds actually received by Vitro or any Consolidated
Subsidiary in connection with such disposition;
(v) Indebtedness to the extent such Indebtedness is secured by Liens
which are purchase money or other Liens upon equipment or Property acquired
or held by Vitro or any of its Consolidated Subsidiaries taken or obtained
by (A) the seller or lessor of such equipment or property to secure all or
a part of the purchase price or lease payment therefore or (B) the Person
who makes advances or incurs obligations, thereby giving value to Vitro or
any of its Consolidated Subsidiaries to enable it to purchase or acquire
rights in such equipment or Property to secure the repayment of all or a
part of the advances so made or obligations so incurred, provided, however,
that (x) such Liens do not extend to or cover any Property of Vitro or any
of its Consolidated Subsidiaries other than the equipment or Property
acquired, and (y) the aggregate principal amount of such Indebtedness,
together with any Indebtedness permitted under clause (iv) of this
paragraph (b) with respect thereto, outstanding at any time does not exceed
$25,000,000;
(vi) Indebtedness of the Borrower arising under a transaction
described in Section 3.04(b)(i), so long as such Indebtedness is
subordinated to the obligations of the Borrower hereunder upon terms and
conditions satisfactory to the Administrative Agent;
(vii) Indebtedness to VENA (including any Indebtedness arising under a
transaction described in Section 3.04(b)(ii)), so long as such Indebtedness
is subordinated to the obligations of the Borrower hereunder upon terms and
conditions satisfactory to the Administrative Agent; and
(viii) Indebtedness arising from the Guarantee of up to $70,000,000 by
Vitro in favor of Pension Benefit Guaranty Corporation in relation to
Anchor Glass Container Corp.'s underfunding liability for pension
obligations in the United States nor the Guarantee Obligation of up to
US$23,500,000 from Vitro to Consumers Packaging Inc. in relation to
environmental clean-up costs.
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10.14 Guaranteed Indebtedness. Neither the Borrower nor VENA will, nor
will it permit any of its Subsidiaries to, create, incur or suffer to exist any
Guarantee in respect of any Indebtedness of Vitro or any Subsidiary of VENA,
other than:
(a) Guarantees of Indebtedness to the Lenders hereunder;
(b) Guarantees by VENA of other Indebtedness of the Borrower or of any
of the VENA Leasing Companies;
(c) Guarantees by any of the VENA Leasing Companies of other
Indebtedness of the Borrower;
(d) Guarantees by the Borrower of Indebtedness of any of the VENA
Leasing Companies; and
(e) Guarantees by the Borrower or by any of the VENA Leasing Companies
of Indebtedness of VENA.
10.15 Negative Pledge. (a) VENA will not, and will not permit any of
its Subsidiaries to, create, assume or suffer to exist any Lien on its interests
in the shares of Vitro OCF, S.A. de C.V., Industria del Alcali, S.A. de C.V.,
Fabricacion de Maquinas, S.A. de C.V., each a Mexican corporation, and ▇▇▇▇▇▇
▇▇▇, ▇.▇., a Bolivian corporation, whether now owned or hereafter acquired by
it.
(b) VENA will not permit Vitro OCF, S.A. de C.V., Industria del
Alcali, S.A. de C.V., Fabricacion de Maquinas, S.A. de C.V., and ▇▇▇▇▇▇ Lux,
S.A. to create, assume or suffer to exist any Lien on their respective
Properties (other than shares of stock of such listed entities) except Liens
securing Indebtedness outstanding at any time in an aggregate principal amount
not exceeding $30,000,000.
(c) VENA and the VENA Leasing Companies will not create, assume or
suffer to exist any Lien on their respective Properties except Liens securing
Indebtedness that is subordinated in right of payment to the prior payment in
full of the Loans and the Notes on terms and conditions and pursuant to
documentation satisfactory to the Majority Lenders and Liens permitted under
clause (a) above.
10.16 Transactions With Affiliates. Without prejudice to anything
expressly permitted under this Agreement, the Guarantors will not, and will not
permit any of their respective Subsidiaries to, directly or indirectly enter
into any transaction with an Affiliate thereof, except in the ordinary course of
and pursuant to the reasonable requirements of its business and upon
commercially reasonable terms that are no less favorable to it than those which
would be obtainable in a comparable arm's-length transaction at the time from a
Person which is not such an Affiliate.
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10.17 Line of Business. It will not make any material change in the
nature or conduct of the business of itself and its Subsidiaries (other than
such of Vitro's Subsidiaries which are not Guarantors) as conducted on the date
hereof, and it will not change the legal nature of its organization.
10.18 Vitro Packaging Operating Account. Vitro Packaging will not,
without the prior consent of the Lenders, transfer the location of the Vitro
Packaging Operating Account.
SECTION 11. EVENTS OF DEFAULT. If one or more of the following events
(herein called "Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay when due any principal of any Loan
or to prepay any Loan when required hereunder, or shall fail to pay within
three Business Days after the due date thereof any interest on any Loan,
any commitment fees or any other amount payable hereunder or under any Note
or any other amount payable under any Loan Document; or
(b) Any representation, warranty or certification made or deemed made
by the Borrower or any Guarantor herein or in either Security Agreement (or
in any modification or supplement hereto or thereto) or any certificate
furnished to any Lender or the Administrative Agent pursuant to the
provisions hereof, shall prove to have been false or misleading in any
material respect as of the time made or furnished; or
(c) The Borrower or any Guarantor (other than Vitro) or any of their
respective Subsidiaries shall default in the payment of any principal of or
interest on any other Indebtedness (whether at stated maturity or at
mandatory or optional prepayment or otherwise) if such Indebtedness has an
aggregate outstanding principal amount of $10,000,000 (or its equivalent in
other currencies) or more ("Material Debt"), or any default or event of
default shall occur under any agreement or instrument evidencing or
relating to such Material Debt if the effect thereof is to accelerate the
maturity thereof, or to permit or enable the holder or holders of such
Material Debt, or an agent or trustee acting on its or their behalf, to
accelerate the maturity thereof, or to require the mandatory prepayment or
redemption thereof; or
(d) Vitro or any of its Material Subsidiaries (other than the
Guarantors) shall fail to make any payment in respect of any other
Indebtedness in an aggregate principal amount exceeding $25,000,000 (or its
equivalent in other currencies) when due or within any applicable grace
period, or any event or condition shall occur which results in the
acceleration of the maturity of any other Indebtedness of Vitro or any of
its Material Subsidiaries (other than the Guarantors) in an aggregate
principal amount exceeding $25,000,000 (or its equivalent in other
currencies);
(e) A Coverage Default shall occur; or
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(f) The Borrower or any Guarantor shall (i) default in the observance
or performance of any of its other obligations under Sections 9 or 10
hereof, as the case may be, or in either Security Agreement or (ii) fail to
perform or observe any of its other obligations under this Agreement (other
than as referred to in clause (a) above) if such failure shall remain
unremedied for 30 days after written notice thereof shall have been given
to the Borrower or any Guarantor by the Administrative Agent or any Lender;
or
(g) The Borrower or any Guarantor or any of their respective Material
Subsidiaries shall admit in writing its inability to, or be generally
unable to, pay its debts as such debts become due; or
(h) The Borrower or any Guarantor or any of their respective Material
Subsidiaries shall (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, liquidador, conciliador,
sindico, trustee, examiner or liquidator of itself or of all or a
substantial part of its Property, (ii) make a general assignment for the
benefit of its creditors, (iii) file a petition seeking to take advantage
of any other law relating to bankruptcy, concurso mercantil, insolvency,
reorganization, suspension of payments, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts or (iv)
take any corporate action for the purpose of effecting any of the
foregoing; or
(i) A proceeding or case shall be commenced against the Borrower or
any Guarantor or any of their respective Material Subsidiaries, without its
application or consent, seeking (i) its reorganization, liquidation,
dissolution, arrangement or winding up, (ii) the appointment of a receiver,
custodian, liquidador, conciliador, sindico, trustee, examiner, liquidator
or the like of it or of all or any substantial part of its Property or
(iii) similar relief in respect of it under any law relating to bankruptcy,
concurso mercantil, insolvency, reorganization, winding up, or composition
or adjustment of debts, and such proceeding or case shall continue
undismissed, or an order, judgment or decree approving or ordering any of
the foregoing shall be entered and continue unstayed and in effect, for a
period of 60 or more days, or a declaration of bankruptcy, concurso
mercantil or suspension of payments shall be entered against the Borrower
or such Guarantor or Material Subsidiary under the Mexican federal
bankruptcy laws as now or hereafter in effect; or
(j) A judgment for the payment of money is or judgments for the
payment of money are rendered against the Borrower or any Guarantor or any
of their respective Subsidiaries in an amount exceeding in the aggregate
$5,000,000 (or its equivalent in other currencies) in the case of any such
Person other than Vitro, or in an amount exceeding in the aggregate
$25,000,000 (or its equivalent in other currencies) in the case of Vitro,
and shall remain unsatisfied, undischarged and in effect for a period of 45
consecutive days without a stay of execution, unless the same is adequately
bonded or is being contested by appropriate proceedings properly instituted
and diligently conducted and, in either case, such process is not being
executed against assets thereof; or the Borrower or any Guarantor or any of
their respective Material Subsidiaries shall fail to pay when due to Social
Security, INFONAVIT, IMSS or SAR any amount or amounts
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aggregating $5,000,000 or more (or its equivalent in Pesos) except to the
extent the amount or amounts due are being contested in good faith by
appropriate proceedings, which proceedings have the effect of preventing
the forfeiture or sale of the Property of the Borrower or such Guarantor or
Subsidiary; or
(k) (i) Any Mexican Governmental Authority shall impose exchange
controls prohibiting or materially restricting the making of payments in
Dollars in respect of Indebtedness payable in a currency other than Pesos;
or (ii) any Mexican Governmental Authority shall take any action to
condemn, seize, nationalize or appropriate any substantial portion of the
Property of the Borrower or any Guarantor (with or without the payment of
compensation); or (iii) any action is taken by a Mexican Governmental
Authority, including without limitation the declaration of a moratorium on
payment of any Indebtedness, that has a Material Adverse Effect on (x) the
repayment of the Loans or (y) the schedule of payments of the Borrower
hereunder or under the Notes; or (iv) the Borrower or any Guarantor shall
participate or take any action to participate in any facility or exercise
involving the rescheduling of its debts or the alteration of the currency
in which it may pay its obligations; or
(l) The Borrower or any Guarantor (other than Vitro) or any of their
respective Subsidiaries or Vitro or any of its Material Subsidiaries shall
enter into any transaction of merger or consolidation, or liquidate, wind
up or dissolve itself (or suffer any liquidation or dissolution), or sell
all or substantially all of its Property, except that it shall not be an
Event of Default hereunder if (x) any Subsidiary of the Borrower merges or
consolidates with any other Subsidiary of the Borrower or any Guarantor or
with the Borrower or any Guarantor, (y) the Borrower or any Guarantor
merges with any other Person, or (z) any Guarantor merges or consolidates
with any other Guarantor, provided, that, in the case of either clause (x)
or (y), (i) after giving effect to such transaction no Default has occurred
and is continuing and (ii) in the case of clause (y), the Borrower or a
Guarantor, as the case may be, is the surviving entity; or
(m) Any of the Loan Documents becomes unenforceable or the performance
of the obligations of the Borrower or any Guarantor thereunder becomes
illegal, or the security interest created by either Security Agreement
shall not constitute a valid first priority lien on and perfected security
interest in the Collateral covered thereby, subject to no equal or senior
Lien (except as provided in Section 9.13 hereof); or
(n) A Change of Control shall occur;
THEREUPON: in any such event, (1) the Administrative Agent shall, upon request
of the Majority Lenders, by notice to the Borrower declare the Commitments to be
terminated forthwith, whereupon the Commitments shall forthwith terminate,
and/or (2) the Administrative Agent shall, upon request of the Majority Lenders,
by notice to the Borrower declare the principal then outstanding of, and the
accrued interest on, the Loans and the Notes and all other amounts payable by
the Borrower hereunder (including, without limitation, any amounts payable under
Section 5.04 hereof) to be forthwith due and payable, whereupon such amounts
shall be immediately due and payable without presentment, demand, protest or
other formalities of any kind, all
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of which are hereby expressly waived by the Borrower; provided, that in the case
of an Event of Default of the kinds referred to in clauses (h) or (i) above with
respect to the Borrower or any Guarantor, the Commitments shall automatically
terminate and such amounts shall automatically become due and payable, without
any further action by any party, and/or (3) the Administrative Agent shall, upon
and pursuant to the instructions of the Majority Lenders, proceed to enforce its
remedies under the Security Agreements and under Section 12 hereof (and, without
limiting the foregoing, the Administrative Agent may instruct the Collateral and
Paying Agent to apply the balance of the Accounts to payment of amounts owing
under this Agreement).
SECTION 12. THE ACCOUNTS.
12.01 The Collection Account and the Reserve Account. The Borrower and
Vitro Packaging hereby agree as follows:
(a) The Collection Account.
(i) The Borrower has established, and will maintain until the payment
in full of all amounts payable under the Loan Documents, the Collection
Account.
(ii) The Borrower hereby irrevocably directs Vitro Packaging, and
Vitro Packaging agrees, to remit to the Collection Account all payments by
it in respect of Eligible Receivables.
(iii) Vitro Packaging shall from time to time cause to be remitted
from the Vitro Packaging Operating Account (up to the collected credit
balance thereof) to the Collection Account such amounts as may be required
to assure that no Early Amortization Event may occur.
(iv) Without limiting the obligations of the Borrower hereunder and
under the Notes, (x) the Administrative Agent shall advise the Collateral
and Paying Agent of the aggregate amount of principal of and interest on
the Loans falling due on each Principal Payment Date prior to or on each
Principal Payment Date, and (y) the Collateral and Paying Agent shall on
such Principal Payment Date (and is hereby irrevocably authorized by the
Borrower to) debit the Collection Account up to the collected credit
balance thereof (and only to the extent necessary to generate sufficient
funds, the Collateral and Paying Agent is irrevocably authorized to
liquidate Permitted Investments in the Collection Account) and apply the
same, in the following order of priority:
First, to the payment in full of all fees and out-of-pocket costs,
charges, fees and expenses of the Agents to the extent not theretofore
paid or reimbursed (including amounts referred to in Section 12.01(i)
hereof);
Second, to the payment of accrued and unpaid interest payable under
Section 3.02(b) hereof and under Section 3.02(a) hereof;
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Third, to the payment of the principal of the Loans due on such
Principal Payment Date;
Fourth, to the Reserve Account until the collected credit balance
thereof equals the Required Reserve Balance;
Fifth, to the payment of any other amounts then due and payable
hereunder or under the other Loan Documents; and
Thereafter, subject to Section 12.01(a)(v), to the Borrower or its
order or as a court of competent jurisdiction may otherwise direct.
Without limiting the obligations of the Borrower hereunder and under the
Notes, if on any Principal Payment Date the collected credit balance of the
Collection Account (after giving effect to such amounts as are transferred
from the Reserve Account pursuant to Section 12.01(b)(iv) hereof) is
insufficient to cover the Debt Service Amount due on such Principal Payment
Date, the Borrower shall forthwith deposit, or cause to be deposited, to
the Collection Account an aggregate amount which is sufficient to cover
such Debt Service Amount.
(v) On any date, during any one month period occurring within any
Interest Period, on which the collected credit balance of the Collection
Account exceeds the Applicable Percentage of the Debt Service Amount in
respect of the then next Principal Payment Date, the Collateral and Paying
Agent will (i) if the balance in the Reserve Account is less than the
Required Reserve Balance, direct such excess to the Reserve Account to the
extent necessary to cause such balance to equal the Required Reserve
Balance, and (ii) thereafter, remit an amount equal to such excess to the
Borrower or its order by the close of business on such date; provided, that
if an Early Amortization Event or an Event of Default has occurred and is
continuing, or (without limiting the foregoing) the Borrower is not in
compliance with Section 12.01(b)(iii) hereof (relating to the Reserve
Account), the Collateral and Paying Agent shall retain all amounts then on
deposit in the Collection Account or thereafter deposited therein as part
of the Deposit Collateral until such time as the amounts then on deposit in
the Collection Account equal the next succeeding Debt Service Amount and
the Borrower is in compliance with said Section 12.01(b)(iii).
Notwithstanding the foregoing, the Collateral and Paying Agent shall not
release any amount from the Collection Account as aforesaid unless and
until the Administrative Agent has advised the Collateral and Paying Agent
that the Administrative Agent has received a certificate pursuant to
Section 9.04(c) confirming the Borrower's compliance with Section 9.11 for
the most recently concluded period of four consecutive fiscal quarters of
the Borrower and certifying that the Borrower's Debt Service Coverage Ratio
for the fiscal quarter then ended is at least 1.50 to 1.00. For purposes
hereof, the "Applicable Percentage" shall mean (i) during the first month
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of any Interest Period, 33 1/3%, (ii) during the second month of any
Interest Period, 66 2/3%, and (iii) during the final month of any Interest
Period, 100%.
(b) The Reserve Account.
(i) The Borrower has established, and will maintain until the payment
in full of all amounts payable under the Loan Documents, the Reserve
Account.
(ii) The Administrative Agent is hereby irrevocably authorized to fund
the Reserve Account, out of the proceeds of the Loans, up to an amount
equal to the Required Reserve Balance.
(iii) The Borrower will at all times after the Borrowing cause the
collected credit balance of the Reserve Account to be an amount equal to
not less than the Required Reserve Balance.
(iv) If on any Principal Payment Date there are insufficient funds in
the Collection Account to pay in full the Debt Service Amount scheduled to
fall due on such Principal Payment Date (prior to giving effect to any
transfers pursuant to the last paragraph of Section 12.01(a)(iv)), the
Collateral and Paying Agent will (and is hereby irrevocably authorized by
the Borrower to) debit the Reserve Account (up to the collected credit
balance thereof) in an amount equal to the shortfall and transfer the same
to the Collection Account for application to payments then due.
(v) Without limiting the provisions of this Section 12, and provided
that no Default has occurred and is continuing, on any Principal Payment
Date on which, after giving effect to the payments required to be made on
such date, the collected credit balance of the Reserve Account exceeds the
Required Reserve Balance, the Collateral and Paying Agent shall (and is
hereby irrevocably authorized by the Borrower to) remit such excess to the
Borrower or its order by the close of business on such Principal Payment
Date; provided, that if an Early Amortization Event or an Event of Default
has occurred and is continuing, such excess shall be remitted to the
Collection Account.
(c) Pledge. As collateral security for the prompt payment in full when
due (whether at stated maturity, by acceleration or otherwise) of the principal
of and interest on the Loans and all of the other obligations, whether now
existing or hereafter from time to time arising, of the Borrower under the Loan
Documents, the Borrower hereby pledges to the Collateral and Paying Agent for
the benefit of the Lenders and the Agents and their respective successors and
assigns, and grants to the Collateral and Paying Agent for the benefit of the
Lenders and the Agents and their respective successors and assigns a first
priority security interest in all of the Borrower's right, title and interest
in, to and under the Collection Account and the Reserve Account, any and all
cash and Permitted Investments and other financial assets (within the meaning of
Section 8-102(a)(9) of the UCC) whatsoever at any time or from time to time
credited to the Collection Account or the Reserve Account, and any and all
security
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entitlements (within the meaning of Section 8-102(a)(17) of the UCC) of
the Borrower with respect to such financial assets, and any and all proceeds of
any of the foregoing (collectively, the "Deposit Collateral").
(d) Sole Dominion. Without prejudice to the provisions of the Account
Control Agreement, the Borrower irrevocably confers upon the Collateral and
Paying Agent sole dominion and control over each Account and the sole and
exclusive power and right to withdraw and remit funds standing to the credit of
each Account, agrees that the Borrower shall not have any right or power of
withdrawal over either Account, and agrees that each of the authorizations
provided for in this Section 12.01 is irrevocable and coupled with an interest.
The Borrower further irrevocably agrees that the Administrative Agent may give
instructions regarding such transactions directly to the Collateral and Paying
Agent, and the Borrower hereby irrevocably authorizes and instructs the
Collateral and Paying Agent to act upon such instructions from the
Administrative Agent with respect to the Accounts without any further consent
of, or instruction from, the Borrower. The Collateral and Paying Agent shall,
within 10 days after receiving an authenticated demand from the Borrower
following payment of all amounts owing hereunder and under any other Loan
Document, send to the Intermediary an authenticated statement that releases the
Intermediary from any further obligation to comply with instructions originated
by the Collateral and Paying Agent.
(e) Instructions. The Collateral and Paying Agent hereby agrees to
accept and follow instructions from the Administrative Agent with respect to the
Accounts and any amounts standing to the credit thereof. The Collateral and
Paying Agent shall be entitled to assume that no Default has occurred and is
continuing unless it receives notice in writing from the Administrative Agent to
the contrary.
(f) Advice. The Collateral and Paying Agent may at any time request
the Administrative Agent to advise it of the Debt Service Amount for the current
fiscal quarter of the Borrower and of the aggregate amount of fees, expenses and
other amounts falling due hereunder, and the Collateral and Paying Agent may
rely conclusively upon the information so provided.
(g) Full Recourse. No receipt, holding, application or disposition of
all or any part of the collected credit balance of either Account (or any other
collateral) shall relieve the Borrower of its liability for any deficiency in
payment of its obligations under the Loan Documents.
(h) Information. The Collateral and Paying Agent will promptly inform
the Administrative Agent (which, in turn, will promptly inform the Lenders) of
(i) the making and amount of each deposit or transfer effected pursuant to the
last sentence of Section 12.01(a)(iv) or Section 12.01(b)(iv) and (ii) within
ten Business Days after each Principal Payment Date, the aggregate amount
deposited in the Collection Account during the preceding fiscal quarter.
(i) Charges, etc. All fees, service charges, costs, adjustments for
any deposit errors, returned or dishonored items, uncollected funds or any other
deficiency for other charges and claims for any liability, loss, damage cost or
expense of the Collateral and Paying Agent
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relating to the Accounts (except to the extent any such amount is attributed to
the Collateral and Paying Agent's bad faith, willful misconduct or gross
negligence) will be charged to the Collection Account. In the event that the
Collateral and Paying Agent is unable to recover all such amounts, the
Collateral and Paying Agent may, until such amounts are paid in full, (i) debit
any other account of the Borrower or any Guarantor, (ii) debit any other account
in the name of the Borrower or any Guarantor for the benefit of the Collateral
and Paying Agent and/or (iii) make demand therefor on the Borrower and the
Borrower shall remit payment in good and collected funds to the Collateral and
Paying Agent within two Business Days of such demand.
12.02 Permitted Investments. The collected credit balance of each of
the Collection Account and the Reserve Account will be invested by the
Collateral and Paying Agent from time to time, for the benefit of the Borrower,
in one or more Permitted Investments, so long as no Event of Default has
occurred and is continuing. The Collateral and Paying Agent shall, from time to
time upon the reasonable request of the Borrower, provide information in respect
of the Permitted Investments in which such balances may have been invested. The
Collateral and Paying Agent shall have no liability or responsibility whatsoever
as to the creditworthiness or collectibility of any Permitted Investment.
12.03 Certain Provisions Relating to Agents.
(a) Without prejudice to the provisions of either Security Agreement,
the Collateral and Paying Agent shall take steps as are instructed in
writing by the Administrative Agent from time to time with respect to the
Collateral, subject to the rights of the Borrower under the Loan Documents.
The Collateral and Paying Agent shall not be required to take any action
which it considers to be contrary to law or this Agreement or either
Security Agreement or the Account Control Agreement, or which would subject
it to personal liability, provided that if the Collateral and Paying Agent
shall decline to take action for any such reason, it shall immediately
notify the Administrative Agent and the Borrower.
(b) Neither Agent shall be liable for any action taken or omitted by
it with respect to the Collateral on the instructions of the other Agent.
Each Agent may conclusively rely and shall be fully protected in acting or
refraining from acting upon any certificate, statement, request, agreement
or other instrument it reasonably believes to be genuine and to have been
signed or presented by or on behalf of the other Agent. In maintaining the
Accounts and otherwise acting hereunder or under either Security Agreement,
the Collateral and Paying Agent may consult with counsel and shall be fully
protected with respect to any action taken or omitted by it in good faith
on advice of counsel and shall have no liability hereunder except for its
bad faith, willful misconduct or gross negligence with respect to its
obligations hereunder. Without limiting any other provision of this
Agreement, the Collateral and Paying Agent shall have no responsibility or
liability with respect to the perfection or priority of any security
interest created by either Security Agreement.
(c) Without limiting any rights or powers granted by this Agreement to
either Agent while no Event of Default has occurred and is continuing, upon
the occurrence and
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during the continuance of any Event of Default, the Administrative Agent is
hereby appointed the attorney-in-fact of the Borrower for the purpose of
carrying out the provisions of this Section 12 and taking any action and
executing any instruments that the Collateral and Paying Agent or the
Administrative Agent may deem necessary or advisable to accomplish the
purposes hereof, which appointment as attorney-in-fact is irrevocable and
coupled with an interest.
SECTION 13. THE AGENTS.
13.01 Appointment, Powers and Immunities.
(i) Each Lender hereby appoints and authorizes each Agent to act as
its agent hereunder and under each Security Agreement with such powers as are
specifically delegated to such Agent by the terms hereof and thereof, together
with such other powers as are reasonably incidental thereto. Each Agent (which
term as used in this sentence and in Section 13.05 hereof and the first sentence
of Section 13.06 hereof shall include reference to its affiliates and its own
and its affiliates' officers, directors, employees and agents):
(a) shall have no duties or responsibilities except those expressly
set forth in this Agreement and the other Loan Documents, and shall not by
reason of this Agreement or the other Loan Documents be a trustee or
fiduciary for any party hereto;
(b) shall not be responsible to the Lenders for any recitals,
statements, representations or warranties contained in this Agreement or
the other Loan Documents, or in any certificate or other document referred
to or provided for in, or received by any of them under, this Agreement or
the other Loan Documents, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any Loan Document or any
other document referred to or provided for herein or therein or for any
failure by the Borrower or any Guarantor or any other Person to perform any
of its obligations hereunder or thereunder;
(c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder (and shall not commence an action or
proceeding on behalf of any Lender without obtaining the consent of such
Lender thereto); and
(d) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under either Security Agreement or under any other
document or instrument referred to or provided for herein or therein or in
connection herewith or therewith, except for its own gross negligence or
willful misconduct.
Each Agent may employ agents and attorneys-in-fact and shall not be responsible
for the negligence or misconduct of or for the supervision of any such agents or
attorneys-in-fact selected by it in good faith.
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(ii) Before the Collateral and Paying Agent acts or refrains from
acting hereunder or under either Security Agreement, it may require an officer's
certificate of the Borrower and/or an opinion of counsel satisfactory to the
Collateral and Paying Agent with respect to such action or inaction. The
Collateral and Paying Agent shall not be liable for any action it takes or omits
to take in good faith in reliance on such certificate or opinion. Whenever in
the administration of either Security Agreement the Collateral and Paying Agent
shall deem it necessary or desirable that a matter be provided or established
prior to taking or suffering or omitting to take any act under such Security
Agreement, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of gross negligence or bad faith on
the part of the Collateral and Paying Agent, be deemed to be conclusively proved
and established by an officers' certificate delivered to the Collateral and
Paying Agent, and such certificate, in the absence of gross negligence or bad
faith on the part of the Collateral and Paying Agent, shall be full warrant to
the Collateral and Paying Agent for any action taken, suffered or omitted to be
taken by it under the provisions of such Security Agreement upon the faith
thereof.
(iii) The Administrative Agent and the Collateral and Paying Agent are
hereby irrevocably authorized to execute and deliver each Security Agreement.
13.02 Reliance by Agents. Each Agent shall be entitled to conclusively
rely upon any certification, notice or other communication (including, without
limitation, any thereof by telephone, telecopy, telex, telegram or cable)
reasonably believed by it to be genuine and correct and to have been signed,
made or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel and other experts selected by such Agent, as the
case may be. As to any matters not expressly provided for by this Agreement,
each Agent shall in all cases be fully protected in acting, or in refraining
from acting, hereunder or under each Security Agreement in accordance with
instructions given by the Majority Lenders, and such instructions of the
Majority Lenders and any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders.
13.03 Defaults. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default (other than a failure to make
a payment of principal of or interest on the Loans) unless the Administrative
Agent has received notice from a Lender or the Borrower specifying such Default
and stating that such notice is a "Notice of Default". In the event that the
Administrative Agent receives a Notice of a Default, the Administrative Agent
shall give prompt notice thereof to the Lenders and neither the Borrower nor any
Guarantor shall be deemed liable if the Administrative Agent fails to provide
such notice to the Lenders. The Administrative Agent shall (subject to Section
13.07 hereof) take such action with respect to any such Default as shall be
directed by the Majority Lenders, provided, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem advisable in
the best interest of the Lenders except to the extent that this Agreement
expressly requires that such action be taken, or not be taken, only with the
consent or upon the authorization of the Majority Lenders or all of the Lenders.
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13.04 Rights as a Lender. With respect to its Commitment and the Loans
made by it, the Administrative Agent in its individual capacity as a Lender
hereunder (if applicable) shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not acting as the
Administrative Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Agent in their
individual capacities. HSBC Investment Bank plc (and any successor acting as
Administrative Agent) and its affiliates may (without having to account therefor
to any Lender) accept deposits from, lend money to, make investments in and
generally engage in any kind of banking, trust or other business with the
Borrower and the Guarantors as if it were not acting as the Administrative
Agent, and HSBC Investment Bank plc (and any such successor) and its affiliates
may accept fees and other consideration from the Borrower and the Guarantors for
services in connection with this Agreement or otherwise without having to
account for the same to the Lenders. The provisions of this Section 13.04 shall
apply mutatis mutandis to the Collateral and Paying Agent.
13.05 Indemnification. The Lenders agree to indemnify each Agent (to
the extent not reimbursed under Section 14.03 hereof, but without limiting the
obligations of the Borrower under said Section 14.03 hereof) ratably in
accordance with the aggregate principal amount of the Loans held by the Lenders
(or, if no Loans are at the time outstanding, ratably in accordance with their
respective Commitments), for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever (including without limitation legal fees and
expenses) that may be imposed on, incurred by or asserted against such Agent
arising out of or by reason of any investigation in any way relating to or
arising out of this Agreement or the Security Agreements or the Account Control
Agreement or any other documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby (including, without
limitation, the costs and expenses that the Borrower is obligated to pay under
Section 14.03 hereof, but excluding, unless an Event of Default has occurred and
is continuing, normal administrative costs and expenses incident to the
performance of its agency duties hereunder) or the enforcement of any of the
terms hereof or thereof or of any such other documents, provided, that no Lender
shall be liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the party to be indemnified. The obligations
of the Lenders under this Section 13.05 shall survive the termination of this
Agreement, the repayment of the Loans and the resignation or removal of either
Agent.
13.06 Non-Reliance on Agents and Other Lenders. Each Lender agrees
that it has, independently and without reliance on either Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and the Guarantors and
decision to enter into this Agreement and that it will, independently and
without reliance upon either Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own analysis and decisions in taking or not taking action under this
Agreement, the Notes, the Account Control Agreement and the Security Agreements.
The Agents shall not be required to keep themselves informed as to the
performance or observance by the Borrower and the Guarantors of this Agreement,
the Notes, the Security Agreements or the Account Control Agreement or any other
document referred to or provided for herein or therein or to inspect the
properties or books of the Borrower or any Guarantor. Except for notices,
reports and other
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documents and information expressly required to be furnished to the Lenders by
an Agent hereunder, such Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition or business of the Borrower or any Guarantor that may come
into the possession of such Agent or any of its affiliates.
13.07 Failure to Act. Except for action expressly required of an Agent
hereunder or under the Security Agreements or the Account Control Agreement,
such Agent shall in all cases be fully justified in failing or refusing to act
hereunder or thereunder unless it shall receive further assurances to its
satisfaction from the Lenders of their indemnification obligations under Section
13.05 hereof against any and all liability and expense that may be incurred by
it by reason of taking or continuing to take any such action.
13.08 Resignation or Removal of Agents. Either Agent may resign at any
time by giving notice thereof to the Lenders, the other Agent and the Borrower,
and either Agent may be removed at any time with or without cause by the
Majority Lenders. Upon any such resignation or removal, the Majority Lenders
shall have the right to appoint a successor Agent, which shall (in the case of
the Administrative Agent) be a bank approved by the Borrower (such approval not
to be unreasonably withheld) that (i) has an office in New York, New York or
London, England, (ii) is registered as a "foreign financial institution" with
the Ministry of Finance for purposes of Article 154 of the Mexican Income Tax
Law, and (iii) is a resident for tax purposes of a country with which Mexico
shall have entered into a treaty for the avoidance of double taxation which is
in effect. If no successor Agent shall have been so appointed by the Majority
Lenders and shall have accepted such appointment within 30 days after the
retiring Agent's giving of notice of resignation or the Majority Lenders'
removal of the retiring Agent, then the retiring Agent's resignation shall
nonetheless become effective and (1) the retiring Agent shall be discharged from
its duties and obligations hereunder and (2) the Majority Lenders shall perform
the duties of the Agent (and all payments and communications provided to be made
by, to or through such Agent shall instead be made by or to each Lender
directly) until such time as the Majority Lenders appoint a successor agent as
provided for above in this paragraph, provided that the Collateral and Paying
Agent shall continue to maintain control of any Collateral for the benefit of
the Lenders until a successor is appointed. Upon the acceptance of any
appointment as an Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder and under the Security
Agreements and the Account Control Agreement except to the extent of liability
arising from prior action. Notwithstanding the foregoing, no removal of either
Agent shall be effective until all amounts then due and owing to the removed
Agent shall be paid in full. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Section 13 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as an Agent.
13.09 The Joint Lead Arrangers. The Joint Lead Arrangers, in their
capacities as such, shall not have any obligations or liabilities hereunder.
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SECTION 14. MISCELLANEOUS.
14.01 Waiver. No failure on the part of any Agent or any Lender to
exercise and no delay in exercising, and no course of dealing with respect to,
any right, power or privilege under any Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power or
privilege under any Loan Document preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The remedies provided
herein are cumulative and not exclusive of any remedies provided by law.
14.02 Notices. All notices, requests, instructions, directions and
other communications provided for herein (including, without limitation, any
modifications of, or waivers, requests or consents under, this Agreement) shall
be given or made in writing (including, without limitation, by telecopy)
delivered, if to the Borrower, any Guarantor or any Agent, to its address
specified on the signature pages hereto, and if to any Lender, to its "Address
for Notices" specified opposite its name on Annex 1 hereto; or, as to any party,
at such other address as shall be designated by such party in a notice to the
Administrative Agent and the Borrower. Except as otherwise provided in this
Agreement, all such communications shall be deemed to have been duly given upon
receipt of a legible copy thereof, in each case given or addressed as aforesaid.
14.03 Expenses, Etc. (a) The Borrower agrees to pay or reimburse (i)
each Agent and each Joint Lead Arranger for all of its reasonable and documented
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees and expenses of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special New York
counsel to the Administrative Agent and the Collateral and Paying Agent, and
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇, S.C., special Mexican counsel to the Administrative
Agent and the Collateral and Paying Agent, and printing, reproduction, document
delivery, communication and travel costs) in connection with (y) the
syndication, negotiation, preparation, execution and delivery of this Agreement
and the other Loan Documents and the making of the Loans hereunder and (z) the
negotiation or preparation of any modification, supplement or waiver of any of
the terms of this Agreement or any of the other Loan Documents (whether or not
consummated) and (ii) the Borrower and each Guarantor agree to reimburse each
Agent, each Joint Lead Arranger and each of the Lenders for all of their
documented out-of-pocket costs and expenses (including, without limitation, the
fees and expenses of legal counsel) in connection with any enforcement or
collection proceedings resulting from the occurrence of an Event of Default.
(b) The Borrower hereby agrees to indemnify each Agent, each Joint
Lead Arranger and each Lender and their respective directors, officers,
employees, attorneys and agents from, and hold each of them harmless against,
any and all losses, liabilities, claims, damages or expenses incurred by any of
them arising out of or by reason of any litigation or other proceedings
(including any threatened litigation or other proceedings) relating to the Loans
or the use or proposed use by the Borrower of the proceeds of any of the Loans,
including, without limitation, the fees and disbursements of counsel incurred in
connection with any such litigation or other proceedings (but excluding any such
losses, liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified, as determined
by a final, nonappealable judgment by a court of competent
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jurisdiction). The right to be indemnified hereunder shall be deemed to expire
to the extent not claimed or asserted in an instrument in writing within the
period of five (5) years after the Final Maturity Date.
14.04 Amendments, Etc. Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be modified or supplemented only
by an instrument in writing signed by the Borrower and the Majority Lenders, or
by the Borrower and the Agents acting with the consent of the Majority Lenders,
and any provision of this Agreement may be waived by the Majority Lenders or by
the Agents acting with the consent of the Majority Lenders; provided, that (a)
no modification, supplement or waiver shall, unless by an instrument signed by
all of the Lenders or by the Administrative Agent acting with the consent of all
of the Lenders (i) increase or extend the term of the Commitments, (ii) extend
the date fixed for the payment of principal of or interest on any Loan or any
fee hereunder, (iii) reduce the amount of any such payment of principal, (iv)
reduce the rate at which interest is payable thereon or any fee is payable
hereunder, (v) release the Collateral (except in accordance with the express
terms of the Security Agreements) or alter the provisions of Section 9.12
hereof, (vi) release any Guarantor from its obligations hereunder, (vii) alter
the terms of this Section 14.04, or (viii) modify the definition of the term
"Majority Lenders" or modify in any other manner the number or percentage of the
Lenders required to make any determinations or waive any rights hereunder or to
modify any provision hereof; and (b) any modification or supplement of Section
13 hereof, or of any of the rights or duties of the Administrative Agent or the
Collateral and Paying Agent hereunder or under either Security Agreement or the
Account Control Agreement, shall require the consent of the Administrative Agent
or the Collateral and Paying Agent, as the case may be. Any such amendment or
waiver shall be binding upon the Lender, each holder of any of the Guaranteed
Obligations and each Guarantor.
14.05 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
14.06 Assignments and Participations.
(a) Neither the Borrower nor any Guarantor may assign any of its
rights or obligations hereunder or under any of the other Loan Documents
without the prior written consent of all of the Lenders and the Agents.
(b) Each Lender may, with the prior consent of the Administrative
Agent (not to be unreasonably withheld), assign its Loans and its
Commitment or any portion thereof; provided, that
(i) any such partial assignment (other than to another Lender)
shall be in an amount at least equal to $5,000,000;
(ii) upon each such assignment, the assignor and assignee shall
deliver to the Borrower and the Administrative Agent a Notice of
Assignment in the form of Exhibit K hereto;
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(iii) each such assignee (other than a Mexican Bank) must be
registered as a "foreign financial institution" with the Ministry of
Finance for purposes of Article 154 of the Mexican Income Tax Law and
be resident for tax purposes of (or the main office of such financial
institution, if acting through a branch or an agency, must be a
resident for tax purposes of) a jurisdiction that is party to a treaty
for the avoidance of double taxation with Mexico which is in effect;
and
(iv) each such assignee shall be an Eligible Assignee; and
provided, further, that upon execution and delivery by the assignor and the
assignee to the Borrower and the Administrative Agent of such Notice of
Assignment, and upon consent thereto to the extent required above, the
assignee shall have, to the extent of such assignment, the obligations,
rights and benefits of a Lender hereunder holding the Commitment and Loans
(or portion thereof) assigned to it and specified in such Notice of
Assignment (in addition to the Commitment and Loans, if any, theretofore
held by such assignee) and the assigning Lender shall, to the extent of
such assignment, be released from the Commitment (or portion thereof) so
assigned (and if so requested by the assignor and the assignee the Borrower
will issue and deliver to the assignor and the assignee new Notes
reflecting such assignment). Upon its receipt of a Notice of Assignment
executed by an assigning Lender and an assignee together with (except in
the case of an assignment by a Lender to an Affiliate of such Lender)
payment by the assignee to the Administrative Agent of an assignment fee of
$3,500, the Administrative Agent shall (i) promptly accept such Notice of
Assignment and (ii) on the effective date determined pursuant thereto
record the information contained therein in the Register (as hereinafter
defined) and give notice of such acceptance and recordation to the Lenders
and the Borrower. Notwithstanding anything to the contrary contained
herein, the Borrower shall not be obligated to pay to any Lender (or any
assignee of any Lender) any amount under any of Sections 5.01, 5.03, 5.04
or 5.05 hereof greater than the amount the Borrower would have been
obligated to pay to such Lender if such Lender had not made any assignment
of its rights under this Agreement, unless such assignment is made at a
time when the circumstances giving rise to such greater payments did not
exist.
(c) The Administrative Agent shall maintain at the address of the
Administrative Agent referred to in Section 14.02 hereof a copy of each
Notice of Assignment delivered to it and a register (the "Register") for
the recordation of the names and addresses of the Lenders and the principal
amounts of the Loans owing to each Lender from time to time. The Borrower,
each Guarantor, the Administrative Agent, the Collateral and Paying Agent
and the Lenders shall treat, and shall be entitled to treat, each Person
whose name is recorded in the Register as the owner of a Loan or other
obligations hereunder as the owner thereof for all purposes of this
Agreement, notwithstanding any notice to the contrary. Any assignment of
any Loan or other obligation hereunder shall be effective only upon
appropriate entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower, Vitro, the
Administrative Agent, the Collateral and Paying Agent or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
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(d) A Lender may, in accordance with applicable law, sell or agree to
sell to one or more other Persons (each a "Participant") a participation in
all or any part of the Loans held by it, or in its Commitment, provided,
that such Participant shall not have any rights or obligations under this
Agreement (the Participant's rights against such Lender in respect of such
participation to be those set forth in the agreements executed by such
Lender in favor of the Participant) and, provided, further, that such
Participant be registered as a "foreign financial institution" with the
Ministry of Finance for purposes of Article 154 of the Mexican Income Tax
Law and be domiciled at a country with which Mexico has entered into a
treaty for the avoidance of double taxation which is in effect. All amounts
payable by the Borrower to any Lender under Section 5 hereof in respect of
any Loan held by it, and its Commitment, shall be determined as if such
Lender had not sold or agreed to sell any participations in such Loan and
Commitment, and as if such Lender were funding such Loan and Commitment in
the same way that it is funding the portion of such Loan and Commitment in
which no participations have been sold. In no event shall a Lender that
sells a participation agree with the Participant to take or refrain from
taking any action hereunder except that such Lender may agree with the
Participant that it will not, without the consent of the Participant, agree
to (i) increase or extend the term of such Lender's Commitment, (ii) extend
the date fixed for the payment of principal of or interest on the related
Loan or any portion of any fee hereunder payable to the Participant, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at
which interest is payable thereon to a level below the rate at which the
Participant is entitled to receive such interest or (v) release the
Collateral (except in accordance with the terms of the Security
Agreements).
(e) In addition to the assignments and participations permitted under
the foregoing provisions of this Section 14.06, any Lender may (without
notice to or consent of the Borrower, the Administrative Agent or any other
Lender and without payment of any fee) assign and pledge all or any portion
of its Loans and Notes to any Federal Reserve Bank as collateral security
pursuant to Regulation A of the Board of Governors of the Federal Reserve
System and any Operating Circular issued by such Federal Reserve Bank,
provided that such Lender shall simultaneously advise the Borrower of such
assignment or pledge. No such assignment shall release the assigning Lender
from its obligations hereunder.
(f) A Lender may furnish any information concerning the Borrower and
each Guarantor obtained by such Lender hereunder from time to time to
assignees and participants (including prospective assignees and
participants).
14.07 Survival. The obligations of the Borrower under Sections 5.01,
5.04, 5.05 and 14.03 hereof, and the obligations of the Lenders under Section
13.05 hereof, shall survive the repayment of the Loans and the termination of
the Commitments and, in the case of any Lender that may assign any interest in
its Commitment or Loans hereunder, shall survive, in the case of any event or
circumstance that occurred prior to the effective date of such assignment, the
making of such assignment, notwithstanding that such assigning Lender may cease
to be a "Lender" hereunder. In addition, each representation and warranty made,
or deemed to be made
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by a notice of any Loan, herein or pursuant hereto shall the making of such
representation and warranty.
14.08 Captions. The table of contents and captions and section
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
14.09 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart. A set of the copies of this Agreement signed by all the
parties hereto shall be lodged with the Borrower and each Agent.
14.10 Governing Law. This Agreement and the rights and obligations of
the parties hereunder shall be governed by, and construed in accordance with,
the law of the State of New York.
14.11 Jurisdiction, Service of Process and Venue.
(a) Each of the parties hereto agrees that any suit, action or
proceeding with respect to this Agreement or the Notes or the Security
Agreements or the Account Control Agreement or any judgment entered by any
court in respect thereof may be brought in the United States District Court
for the Southern District of New York or the Supreme Court of the State of
New York, County of New York, and in the courts of its own corporate
domicile, in respect of actions brought against it as a defendant, and
irrevocably submits to the jurisdiction of each such court for the purpose
of any such suit, action, proceeding or judgment.
(b) The Borrower and each Guarantor hereby irrevocably appoints CT
Corporation System (the "Process Agent"), with an office on the date hereof
at ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its agent and true and
lawful attorney-in-fact in its name, place and stead to accept on behalf of
the Borrower, each Guarantor and their respective Property and revenues
service of copies of the summons and complaint and any other process which
may be served in any such suit, action or proceeding brought in the State
of New York, and each of the Borrower and each Guarantor agrees that the
failure of the Process Agent to give any notice of any such service of
process to the Borrower or such Guarantor shall not impair or affect the
validity of such service or, to the extent permitted by applicable law, the
enforcement of any judgment based thereon.
(c) Nothing herein shall in any way be deemed to limit the ability of
the Administrative Agent or any Lender to serve any such process or
summonses in any other manner permitted by applicable law.
(d) Each of the Borrower and each Guarantor hereby irrevocably waives
to the fullest extent permitted by law any objection that it may now or
hereafter have to the laying of the venue of any suit, action or proceeding
arising out of or relating to this
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Agreement or the Notes brought in the United States District Court for the
Southern District of New York or the Supreme Court of the State of New York
and hereby further irrevocably waives to the fullest extent permitted by
law any claim that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient forum and any right to which it
may be entitled on account of place of residence or domicile. A final
judgment (in respect of which time for all appeals has elapsed) in any such
suit, action or proceeding shall be conclusive and may be enforced in any
court to the jurisdiction of which the Borrower or any Guarantor is or may
be subject, by suit upon judgment.
14.12 Waiver of Jury Trial. EACH OF THE BORROWER, EACH GUARANTOR, THE
ADMINISTRATIVE AGENT, THE COLLATERAL AND PAYING AGENT AND THE LENDERS HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE NOTES, THE SECURITY AGREEMENTS OR THE ACCOUNT CONTROL
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
14.13 Waiver of Immunity. To the extent that the Borrower or any
Guarantor may be or become entitled to claim for itself or its Property or
revenues any immunity on the ground of sovereignty or the like from suit, court
jurisdiction, attachment prior to judgment, attachment in aid of execution of a
judgment or execution of a judgment, and to the extent that in any such
jurisdiction there may be attributed such an immunity (whether or not claimed),
each of the Borrower and each Guarantor hereby irrevocably agrees not to claim
and hereby irrevocably waives such immunity with respect to its obligations
under this Agreement, the Notes, the Security Agreements and the Account Control
Agreement.
14.14 Judgment Currency. This is an international loan transaction in
which the specification of Dollars and payment in New York City is of the
essence, and the obligations of the Borrower and the Guarantors under this
Agreement and the Notes to each Lender or Agent (in this Section 14.14 called an
"Entitled Person") to make payment in Dollars shall not be discharged or
satisfied by any tender or recovery pursuant to any judgment expressed in or
converted into any other currency or in another place except to the extent that
on the Business Day following receipt of any sum adjudged to be so due in the
judgment currency such Entitled Person may in accordance with normal banking
procedures purchase, and transfer to New York City, Dollars in the amount
originally due to such Entitled Person with the judgment currency. If for the
purpose of obtaining judgment in any court it is necessary to convert a sum due
hereunder in Dollars into another currency (in this Section 14.14 called the
"judgment currency"), the rate of exchange that shall be applied shall be that
at which in accordance with normal banking procedures the Entitled Person could
purchase such Dollars at New York, New York with the judgment currency on the
Business Day next succeeding the day on which such judgment is rendered. The
Borrower and each Guarantor hereby, as a separate obligation and notwithstanding
any such judgment, agree to indemnify such Entitled Person against, and to pay
each Entitled Person on demand, in Dollars, the amount (if any) by which the sum
originally due to such Entitled Person in Dollars hereunder exceeds the amount
of the Dollars purchased and
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transferred as aforesaid. Each Entitled Person, as a separate obligation and
notwithstanding any such judgment, agrees to pay to the Borrower and any
Guarantor hereby on demand, in Dollars, the amount (if any) by which the amount
of the Dollars purchased and transferred as aforesaid exceeds the sum originally
due to the Borrower or such Guarantor in Dollars hereunder.
14.15 Use of English Language. This Agreement has been negotiated and
executed in the English language. All certificates, reports, notices and other
documents and communications given or delivered pursuant to this Agreement
(including, without limitation, any modifications or supplements hereto) shall
be in the English language, or accompanied by a certified English translation
thereof. In the case of any document originally issued in a language other than
English, the English language version of such document shall for purposes of
this Agreement, and absent manifest error, control the meaning of the matters
set forth therein, except for the estatutos sociales and other corporate
documents of the Borrower, VENA and the VENA Leasing Companies, in which the
controlling language shall be Spanish.
14.16 Entire Agreement. This Agreement and the other Loan Documents
and the agreement referred to in Section 2.03 hereof constitute the entire
agreement among the parties with respect to the subject matter hereof and
thereof.
14.17 Severability. If any provision hereof is found by a court to be
invalid or unenforceable, to the fullest extent permitted by applicable law the
parties agree that such invalidity or unenforceability shall not impair the
validity or enforceability of any other provision hereof.
14.18 Right of Set-off. Upon the occurrence and during the continuance
of any Event of Default, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Lender or such Affiliate to or for the credit or the account
of the Borrower or any Guarantor against any and all of the obligations of the
Borrower or any Guarantor now or hereafter existing under this Agreement and the
Note held by such Lender, whether or not such Lender shall have made any demand
under this Agreement or such Note and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower after any such
set-off and application, provided, that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of each
Lender and its Affiliates under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) that such
Lender and its Affiliates may have.
14.19 Confidentiality. Each Lender agrees to hold all Confidential
Information obtained pursuant to the provisions of this Agreement or any other
Loan Document in accordance with its customary procedure for handling such
information of this nature and in accordance with safe and sound banking
practices, provided that nothing herein shall prevent any Lender from disclosing
such information (i) to any other Lender or to the Administrative Agent or to
the Collateral and Paying Agent, (ii) upon the order of any court or
administrative agency or otherwise to the extent required by statute, rule,
regulation or judicial process, (iii) to bank examiners or upon the request or
demand of any other regulatory agency or authority, (iv) which
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had been publicly disclosed other than as a result of a disclosure by the
Administrative Agent or the Collateral and Paying Agent or any Lender prohibited
by this Agreement, (v) in connection with any litigation to which any one or
more of the Lenders or the Administrative Agent or the Collateral and Paying
Agent is a party, or in connection with the exercise of any remedy hereunder or
under the Loan Documents, (vi) to such Lender's or Administrative Agent's or
Collateral and Paying Agent's legal counsel and independent auditors and
accountants, and (vii) subject to provisions substantially similar to those
contained in this Section 14.19, to any actual or proposed participant or
assignee.
14.20 No Fiduciary Relationship. The Borrower acknowledges that the
Lenders have no fiduciary relationship with, or fiduciary duty to, the Borrower
or any Guarantor or any Affiliate or Subsidiary thereof arising out of or in
connection with this Agreement or the Notes, and the relationship between each
Lender and the Borrower and the Guarantors is solely that of creditor and
debtor. This Agreement does not create a joint venture among the parties.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
BORROWER
COMPANIA VIDRIERA, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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GUARANTORS
VITRO, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
Chief Executive Officer
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VITRO PACKAGING, INC.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VITRO ENVASES NORTEAMERICA,
S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA GUADALAJARA, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA MEXICALI, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA MEXICO, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA MONTERREY, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA QUERETARO, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
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VIDRIERA TOLUCA, S.A. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
-80-
VIDRIERA LOS ▇▇▇▇▇, ▇.▇. DE C.V.
By:
---------------------------------
Name:
Title:
Address for Notices:
Ave. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ #▇▇▇
▇▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
Mexico
C.P. 66265
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
President, Containers
-81-
ADMINISTRATIVE AGENT
HSBC INVESTMENT BANK PLC,
as Administrative Agent
By:
---------------------------------
Name:
Title:
Address for Notices:
HSBC Investment Bank plc
City Place House
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▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Att: Syndication Finance Agency
Tel: ▇▇▇ ▇▇▇▇ ▇▇▇▇
Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇
COLLATERAL AND PAYING AGENT
HSBC BANK USA,
as Collateral and Paying Agent
By:
---------------------------------
Name:
Title:
Address for Notices:
HSBC Bank USA
Issuer Services
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
-82-
LENDERS
HSBC BANK USA
By:
---------------------------------
Name:
Title:
-83-
CITIBANK, N.A., NASSAU BAHAMAS BRANCH
By:
---------------------------------
Name:
Title:
-84-
ABN AMRO BANK, N.V.
By:
---------------------------------
Name:
Title:
-85-
BANCO NACIONAL DE COMERCIO EXTERIOR,
S.N.C., GRAND CAYMAN BRANCH
By:
---------------------------------
Name:
Title:
-▇▇-
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇, ▇.▇.
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
-87-
BANK OF MONTREAL
By:
---------------------------------
Name:
Title:
-▇▇-
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, S.P.A.,
NEW YORK, IBF, BRANCH
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
-▇▇-
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ BANK
By:
---------------------------------
Name:
Title:
-90-
CREDIT SUISSE FIRST BOSTON
By:
---------------------------------
Name:
Title:
