AMENDED AND RESTATED
--------------------
REVOLVING CREDIT AGREEMENT
--------------------------
DATED as of December 18, 1997
among
NEW ENGLAND BUSINESS SERVICE, INC.,
THE BANKS LISTED ON Schedule 1 hereto,
----------
BANKBOSTON, N.A., as Agent,
and
FLEET NATIONAL BANK, as Documentation Agent
BANCBOSTON SECURITIES INC., Arranger
TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION. 1
1.1. Definitions. 1
1.2. Rules of Interpretation. 17
2. THE REVOLVING CREDIT FACILITY. 18
2.1. Commitment to Lend Syndicated Loans. 18
2.2. Requests for Loans. 18
2.3. Competitive Bid Loans. 19
2.3.1. Competitive Bid Borrowings. 19
2.3.2. Maximum Competitive Bid Loans; Funding Losses. 23
2.3.3. Repayment of Competitive Bid Loans. 23
2.4. Funds for Loans. 24
2.4.1. Funding Procedures. 24
2.4.2. Advances by Agent. 24
2.5. The Notes. 25
2.5.1. Syndicated Notes. 25
2.5.2. Competitive Bid Notes. 25
2.6. Reduction of Total Commitment. 26
2.7. Interest on Loans. 26
2.8. Conversion Options. 27
2.8.1. Conversion to Different Type of Syndicated Loan. 27
2.8.2. Continuation of Type of Syndicated Loan. 28
2.8.3. Eurodollar Rate Loans. 28
2.9. Limited Increase In Total Commitment. 28
3. REPAYMENT OF THE LOANS. 29
3.1. Maturity. 29
3.2. Mandatory Repayments of Loans. 29
3.3. Optional Repayments of Syndicated Loans. 29
4. CERTAIN GENERAL PROVISIONS. 30
4.1. Certain Fees. 30
4.1.1. Agent and Arranger Fees. 30
4.1.2. Documentation Agent's Fee. 30
4.2. Facility Fee. 30
4.3. Funds for Payments. 30
4.3.1. Payments to Agent. 30
4.3.2. No Offset, etc. 31
4.4. Computations. 31
4.5. Inability to Determine Eurodollar Rate. 32
4.6. Illegality. 32
4.7. Additional Costs, etc. 32
4.8. Capital Adequacy. 34
4.9. Certificate. 34
4.10. Indemnity. 34
4.11. Interest After Default. 35
4.11.1. Overdue Amounts. 35
4.11.2. Amounts Not Overdue. 35
4.12. Guaranties. 35
5. REPRESENTATIONS AND WARRANTIES. 35
5.1. Corporate Authority. 35
5.1.1. Incorporation; Good Standing. 35
5.1.2. Authorization. 36
5.1.3. Enforceability. 36
5.2. Governmental Approvals. 36
5.3. Title to Properties; Leases. 36
5.4. Financial Statements. 37
5.5. No Material Changes, etc. 37
5.6. Franchises, Patents, Copyrights, etc. 37
5.7. Litigation. 37
5.8. No Materially Adverse Contracts, etc. 38
5.9. Compliance With Other Instruments, Laws, etc. 38
5.10. Tax Status. 38
5.11. No Event of Default. 38
5.12. Holding Company and Investment Company Acts. 38
5.13. Absence of Financing Statements, etc. 39
5.14. Chief Executive Office. 39
5.15. Certain Transactions. 39
5.16. Employee Benefit Plans. 39
5.16.1. In General. 39
5.16.2. Terminability of Welfare Plans. 39
5.16.3. Guaranteed Pension Plans. 40
5.16.4. Multiemployer Plans. 40
5.17. Use of Proceeds. 41
5.17.1. General. 41
5.17.2. Regulations U and X. 41
5.17.3. Ineligible Securities. 41
5.18. Environmental Compliance. 41
5.19. Subsidiaries, etc. 43
5.20. Disclosure. 43
5.21. Fiscal Year. 44
5.22. Solvency. 44
5.23. Rapidforms Acquisition. 44
6. AFFIRMATIVE COVENANTS OF THE BORROWER. 44
6.1. Punctual Payment. 44
6.2. Maintenance of Office. 44
6.3. Records and Accounts. 45
6.4. Financial Statements, Certificates and Information. 45
6.5. Notices. 46
6.5.1. Defaults. 46
6.5.2. Environmental Events. 47
6.5.3. Notice of Litigation and Judgments. 47
6.6. Corporate Existence; Maintenance of Properties. 47
6.7. Insurance. 48
6.8. Taxes. 48
6.9. Inspection of Properties and Books, etc. 48
6.9.1. General. 48
6.9.2. Communication with Accountants. 49
6.10. Compliance with Laws, Contracts, Licenses, and Permits. 49
6.11. Employee Benefit Plans. 49
6.12. Use of Proceeds. 50
6.13. Rapidforms Acquisition. 50
6.13.1. Guaranty, etc. 50
6.13.2. Amendment of Certificate of Incorporation. 50
6.13.3. Closing Balance Sheet. 50
6.13.4. Obligations Under Trust Indenture. 50
6.14. Further Assurances. 50
7. CERTAIN NEGATIVE COVENANTS OF THE BORROWER. 51
7.1. Restrictions on Indebtedness. 51
7.2. Restrictions on Liens. 53
7.3. Restrictions on Investments. 55
7.4. Distributions. 56
7.5. Merger, Consolidation. 56
7.5.1. Mergers and Acquisitions. 56
7.5.2. Disposition of Assets. 56
7.6. Sale and Leaseback. 57
7.7. Compliance with Environmental Laws. 57
7.8. Employee Benefit Plans. 57
7.9. Fiscal Year. 58
7.10. Prohibition on Negative Pledges. 58
7.11. Creation and Maintenance of Subsidiaries. 58
7.12. Conduct of Business. 59
8. FINANCIAL COVENANTS OF THE BORROWER. 59
8.1. Funded Debt to EBITDA. 59
8.2. Minimum Fixed Charge Coverage Ratio. 59
8.3. Consolidated Net Worth. 59
9. CLOSING CONDITIONS. 59
9.1. Loan Documents. 59
9.2. Certified Copies of Charter Documents. 59
9.3. Corporate Action. 60
9.4. Incumbency Certificate. 60
9.5. UCC Search Results. 60
9.6. Certificates of Insurance. 60
9.7. Solvency Certificate. 60
9.8. Opinion of Counsel. 60
9.9. Payment of Fees. 61
10. CONDITIONS TO ALL BORROWINGS. 61
10.1. Representations True; No Event of Default. 61
10.2. No Legal Impediment. 61
10.3. Governmental Regulation. 61
10.4. Proceedings and Documents. 61
11. EVENTS OF DEFAULT; ACCELERATION; ETC. 62
11.1. Events of Default and Acceleration. 62
11.2. Termination of Commitments. 65
11.3. Remedies. 66
12. SETOFF. 66
13. THE AGENT. 67
13.1. Authorization. 67
13.2. Employees and Agents. 68
13.3. No Liability. 68
13.4. No Representations. 68
13.5. Payments. 69
13.5.1. Payments to Agent. 69
13.5.2. Distribution by Agent. 69
13.5.3. Delinquent Banks. 69
13.6. Holders of Notes. 70
13.7. Indemnity. 70
13.8. Agent as Bank. 70
13.9. Resignation. 70
13.10. Notification of Defaults and Events of Default. 71
13.11. Limitation on Duties. 71
14. EXPENSES. 71
15. INDEMNIFICATION. 72
16. SURVIVAL OF COVENANTS, ETC. 73
17. ASSIGNMENT AND PARTICIPATION. 73
17.1. Conditions to Assignment by Banks. 73
17.2. Certain Representations and Warranties;
Limitations; Covenants. 74
17.3. Register. 75
17.4. New Notes. 75
17.5. Participations. 76
17.6. Disclosure. 76
17.7. Assignee or Participant Affiliated with the Borrower. 76
17.8. Miscellaneous Assignment Provisions. 77
17.9. Assignment by Borrower. 77
18. NOTICES, ETC. 77
19. GOVERNING LAW. 78
20. HEADINGS. 79
21. COUNTERPARTS. 79
22. ENTIRE AGREEMENT, ETC. 79
23. WAIVER OF JURY TRIAL. 79
24. CONSENTS, AMENDMENTS, WAIVERS, ETC. 80
25. SEVERABILITY. 80
26. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION. 80
26.1. Confidentiality. 80
26.2. Prior Notification. 81
26.3. Other. 81
27. TRANSITIONAL ARRANGEMENTS. 81
27.1. Original Credit Agreement Superseded. 81
27.2. Return and Cancellation of Notes. 82
27.3. Fees Under Original Credit Agreement. 82
Exhibits
--------
Exhibit A - Guaranty
Exhibit B - Loan Request
Exhibit C - Competitive Bid Quote Request
Exhibit D - Invitation For Competitive Bid Quotes
Exhibit E-1 - Competitive Bid Quote
Exhibit E-2 - Notice of Competitive Bid Borrowing
Exhibit E-3 - Form of Notice of Competitive Bid Loans
Exhibit F-1 - Syndicated Note
Exhibit F-2 - Competitive Bid Note
Exhibit G - Compliance Certificate
Exhibit H - Assignment and Acceptance
Exhibit I - Rapidforms Environmental Site Assessment
Preliminary Report
Schedules
---------
Schedule 1 - Banks; Commitment Percentages
Schedule 5.3 - Title to Property; Leases
Schedule 5.5 - Distribution Since Balance Sheet Date
Schedule 5.15 - Transactions with Affiliates
Schedule 5.18 - Environmental Compliance
Schedule 5.19 - Subsidiaries, etc.
Schedule 7.1 - Existing Indebtedness
Schedule 7.2 - Existing Liens
Schedule 7.3 - Existing Investments
AMENDED AND RESTATED
--------------------
REVOLVING CREDIT AGREEMENT
--------------------------
This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is made as of
December 18, 1997, by and among NEW ENGLAND BUSINESS SERVICE, INC. (the
"Borrower"), a Delaware corporation having its principal place of
business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, BANKBOSTON,
N.A., formerly known as THE FIRST NATIONAL BANK OF BOSTON, a national
banking association, and the other lending institutions listed on
Schedule 1 hereto, BANKBOSTON, N.A., formerly known as THE FIRST NATIONAL
BANK OF BOSTON, as agent for itself and such other lending institutions,
and FLEET NATIONAL BANK, as documentation agent for itself and such other
lending institutions.
The Borrower, the Agent, the Documentation Agent and certain of the
Banks have heretofore entered into a Revolving Credit Agreement dated as
of March 26, 1997 (the "Original Credit Agreement"). Each of the
Borrower, the Agent, the Documentation Agent and such Banks desire, upon
the terms and conditions set forth herein, to amend and restate the
Original Credit Agreement in order, among other things, to increase the
size of the Total Commitment and to add certain additional lending
institutions as "Banks" for purposes hereof. Accordingly, the parties
hereto hereby agree to amend and restate the Original Credit Agreement as
follows:
1. DEFINITIONS AND RULES OF INTERPRETATION.
--------------------------------------------
1.1. Definitions. The following terms shall have the meanings set
forth in this Section 1 or elsewhere in the provisions of this Credit
Agreement referred to below:
Affiliate. Any Person that would be considered to be an affiliate
of the Borrower under Rule 144(a) of the Rules and Regulations of the
Securities and Exchange Commission, as in effect on the date hereof, if
the Borrower were issuing securities.
Agent's Fee Letter. The side letter dated as of the Closing Date
among the Agent, the Arranger and the Borrower regarding certain fees to
be paid by the Borrower to the Agent and the Arranger on and after the
Closing Date.
-2-
Agent's Head Office. The Agent's head office located at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other location as the
Agent may designate from time to time.
Agent. BankBoston, N.A. acting as agent for the Banks.
Agent's Special Counsel. ▇▇▇▇▇▇▇ ▇▇▇▇ LLP or such other counsel as
may be approved by the Agent.
Applicable Eurodollar Rate Margin. For any fiscal quarter or
portion thereof within any Interest Period with respect to any Eurodollar
Rate Loan, 0.525% per annum; provided, however, that in the event that
the ratio of Consolidated Funded Debt (calculated as of the last day of
such fiscal quarter or portion thereof) to EBITDA (calculated for the
four (4) consecutive fiscal quarters ending on the last day of such
fiscal quarter or portion thereof) meets the requirements set forth in
the chart below, the Applicable Eurodollar Rate Margin shall, commencing
initially with the date on which the Borrower delivers to the Banks the
financial statements referred to in Section 6.4(b) with respect to the
fiscal quarter ended March 28, 1998 and thereafter commencing with the
date on which the Borrower delivers to the Banks the financial statements
referred to in Section 6.4(a) or, as the case may be, Section 6.4(b)
and ending on the date of the next change to be effected pursuant to this
paragraph, be the percentage set forth opposite the applicable ratio of
Consolidated Funded Debt to EBITDA in the table below:
Ratio of Consolidated Funded Applicable Eurodollar
Debt to EBITDA Rate Margin
-------------- -----------
Less than or equal to 1.0:1.0 0.350%
Greater than 1.0:1.0 and less 0.400%
than or equal to 1.5:1.0
Greater than 1.5:1.0 and less 0.525%
than or equal to 2.0:1.0
Greater than 2.0:1.0 0.650%
If any financial statements referred to above are not delivered within
the time periods specified in Section 6.4(a) or, as the case may be,
Section 6.4(b), then, until such financial statements are delivered,
the Applicable Eurodollar Rate Margin as at the end of the fiscal period
that would have been covered thereby shall, for the purposes of this
definition, be deemed to be .650%. In addition, at all times while a
Default or an Event of Default shall have
-3-
occurred and be continuing, the Applicable Eurodollar Rate Margin shall,
for the purposes of this definition, be deemed to be .650%.
Applicable Facility Fee Percentage. For any fiscal quarter or
portion thereof, 0.225% per annum; provided, however, that in the event
that the ratio of Consolidated Funded Debt (calculated as of the last day
of such fiscal quarter or portion thereof) to EBITDA (calculated for the
four consecutive fiscal quarters existing on the last day of such fiscal
quarter or portion thereof) meets the requirements set forth in the chart
below, the Applicable Facility Fee Percentage shall, commencing initially
with the date on which the Borrower delivers to the Banks the financial
statements referred to in Section 6.4(b) with respect to the fiscal
quarter ended March 28, 1998 and thereafter commencing with the date on
which the Borrower delivers to the Banks the financial statements
referred to in Section 6.4(a) or, as the case may be, Section 6.4(b) and
ending on the next change to be effected pursuant to this paragraph, be
the percentage set forth opposite the applicable ratio of Consolidated
Funded Debt to EBITDA set forth in the table below:
Ratio of Consolidated Funded Applicable Facility
Debt to EBITDA Fee Percentage
-------------- --------------
Less than or equal to 1.0:1.0 0.150%
Greater than 1.0:1.0 and less 0.200%
than or equal to 1.5:1.0
Greater than 1.5:1.0 and less 0.225%
than or equal to 2.0:1.0
Greater than 2.0:1.0 0.250%
If any financial statements referred to above are not delivered within
the time periods specified in Section 6.4(a) or, as the case may be,
Section 6.4(b), then, until such financial statements are delivered, the
Applicable Facility Fee Percentage as at the end of the fiscal period
that would have been covered thereby shall, for the purposes of this
definition, be deemed to be .250%. In addition, at all times a Default
or Event of Default shall have occurred and be continuing, the Applicable
Facility Fee Percentage shall, for the purposes of this definition, be
.250%.
Arranger. BancBoston Securities Inc.
Assignment and Acceptance. See Section 17.1.
-4-
Balance Sheet Date. June 28, 1997.
Banks. BKB and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to Section 17.
Base Rate. The higher of (i) the annual rate of interest announced
from time to time by BKB at its head office in Boston, Massachusetts, as
its "base rate" and (ii) one-half of one percent (1/2%) above the Federal
Funds Effective Rate. For the purposes of this definition, "Federal
Funds Effective Rate" shall mean, for any day, the rate per annum equal
to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published for such day (or if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three funds brokers of recognized
standing selected by the Agent.
Base Rate Loans. Any Syndicated Loans bearing interest calculated
by reference to the Base Rate.
BKB. BankBoston, N.A., formerly known as The First National Bank of
Boston, a national banking association, in its individual capacity.
Borrower. As defined in the preamble hereto.
Business Day. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in
the case of Eurodollar Rate Loans, also a day which is a Eurodollar
Business Day.
Capital Assets. Fixed assets, both tangible (such as land,
buildings, fixtures, machinery and equipment) and intangible (such as
patents, copyrights, trademarks, franchises and goodwill); provided that
Capital Assets shall not include any item customarily charged directly to
expense or depreciated over a useful life of twelve (12) months or less
in accordance with generally accepted accounting principles.
Capital Expenditures. Amounts paid or indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with the purchase or
lease by the Borrower or any of its Subsidiaries of Capital Assets that
would be required to be capitalized and shown on the balance sheet of
such Person in accordance with generally accepted accounting principles.
-5-
Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental
payment obligations under which are required to be capitalized on the
balance sheet of the lessee or obligor in accordance with generally
accepted accounting principles.
CERCLA. See Section 5.18.
Closing Date. The first date on which the conditions set forth in
Section 9 have been satisfied and any Loans are to be made.
Code. The Internal Revenue Code of 1986, as amended.
Commitment. With respect to each Bank, the amount set forth on
Schedule 1 hereto as the amount of such Bank's commitment to make
Syndicated Loans to the Borrower, as the same may be reduced from time to
time; or if such commitment is terminated pursuant to the provisions
hereof, zero. The Competitive Bid Loans of such Bank outstanding at any
time shall not affect such Bank's Commitment.
Commitment Percentage. With respect to each Bank, the percentage
set forth on Schedule 1 hereto as such Bank's percentage of the aggregate
Commitments of all of the Banks. The Competitive Bid Loans of such Bank
outstanding at any time shall not affect such Bank's Commitment
Percentage.
Competitive Bid Loan(s). A borrowing hereunder consisting of one or
more revolving credit loans made by any of the Banks whose offer to make
a revolving credit loan as part of such borrowing has been accepted by
the Borrower under the auction bidding procedure described in Section 2.3
hereof.
Competitive Bid Note. See Section 2.5.2 hereof.
Competitive Bid Quote. An offer by a Bank to make a Competitive Bid
Loan in accordance with Section 2.3 hereof.
Competitive Bid Quote Request. See Section 2.3.1(b) hereof.
Competitive Bid Rate. See Section 2.3.1(d)(ii)(C) hereof.
Consolidated or consolidated. With reference to any term defined
herein, shall mean that term as applied to the accounts of the Borrower
and its Subsidiaries, consolidated in accordance with generally accepted
accounting principles.
-6-
Consolidated Funded Debt. At any time of determination, the sum of
(i) the amount of the Loans outstanding (after giving account to any
amounts requested) plus accrued but unpaid interest thereon; plus (ii)
the outstanding amount of any other Indebtedness for borrowed money, in
respect of Capitalized Leases or which is otherwise subject to the
payment of interest plus accrued but unpaid interest on such
Indebtedness, including expenses consisting of interest in respect of
Capitalized Leases and including commitment fee, agency fee, facility
fee, balance deficiency fee and similar fee expenses in connection with
the borrowing of money.
Consolidated Net Income. The consolidated net income (or deficit)
of the Borrower and its Subsidiaries, after deduction of all expenses,
taxes and other proper charges, determined in accordance with generally
accepted accounting principles, after eliminating therefrom all
extraordinary nonrecurring items of income.
Consolidated Net Worth. The excess of Consolidated Total Assets
over Consolidated Total Liabilities.
Consolidated Total Assets. All assets of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with
generally accepted accounting principles.
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest required to be expensed by the Borrower and its
Subsidiaries in accordance with generally accepted accounting principles
during such period on all Indebtedness of the Borrower and its
Subsidiaries outstanding during all or any part of such period, including
expense consisting of interest in respect of Capitalized Leases and
including commitment fee, agency fee, facility fee, balance deficiency
fee and similar fee expense in connection with the borrowing of money.
Consolidated Total Liabilities. All liabilities of the Borrower and
its Subsidiaries determined on a consolidated basis in accordance with
generally accepted accounting principles.
Conversion Request. A notice given by the Borrower to the Agent of
the Borrower's election to convert or continue a Loan in accordance with
Section 2.8.
Credit Agreement. This Amended and Restated Revolving Credit
Agreement, including the Schedules and Exhibits hereto.
Default. See Section 11.
-7-
Distribution. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of the Borrower,
other than dividends payable solely in shares of common stock of the
Borrower; the purchase, redemption, or other retirement of any shares of
any class of capital stock, or of any rights, warrants or options to
acquire shares of any class of capital stock, of the Borrower, directly
or indirectly through a Subsidiary of the Borrower or otherwise; the
return of capital by the Borrower to its shareholders as such; or any
other distribution on or in respect of any shares of any class of capital
stock of the Borrower.
Documentation Agent. Fleet National Bank, in its capacity as
documentation agent.
Documentation Agent's Fee Letter. The side letter dated as of the
Closing Date between the Borrower and the Documentation Agent, regarding
certain fees to be paid by the Borrower to the Documentation Agent on the
Closing Date.
Dollars or $. Dollars in lawful currency of the United States of
America.
Domestic Lending Office. Initially, the office of each Bank
designated as such in Schedule 1 hereto; thereafter, such other office of
such Bank, if any, located within the United States that will be making
or maintaining Base Rate Loans.
Drawdown Date. The date on which any Loan is made or is to be made,
and the date on which any Loan is converted or continued in accordance
with Section 2.8.
EBITDA. The consolidated earnings (or loss) from the operations of
the Borrower and its Subsidiaries for any period, after all expenses and
other proper charges but before payment or provision for any income
taxes, interest expense, depreciation or amortization for such period,
determined in accordance with generally accepted accounting principles.
Eligible Assignee. Any of (i) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or
the District of Columbia, and having total assets in excess of
$1,000,000,000; (ii) a savings and loan association or savings bank
organized under the laws of the United States, or any State thereof or
the District of Columbia, and having a net worth of at least
$100,000,000, calculated in accordance with generally accepted accounting
principles; (iii) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation
and Development (the "OECD"), or a political subdivision of any such
country, and having total assets in
-8-
excess of $1,000,000,000, provided that such bank is acting through a
branch or agency located in the country in which it is organized or
another country which is also a member of the OECD; (iv) the central bank
of any country which is a member of the OECD; and (v) if, but only if, an
Event of Default has occurred and is continuing, any other bank,
insurance company, commercial finance company or other financial
institution or other Person approved by the Agent, such approval not to
be unreasonably withheld.
Employee Benefit Plan. Any employee benefit plan within the meaning
of Section 3(2) of ERISA maintained or contributed to by the Borrower,
other than a Guaranteed Pension Plan or a Multiemployer Plan.
Environmental Laws. See Section 5.18(a).
ERISA. The Employee Retirement Income Security Act of 1974, as
amended, including all rules, regulations, decrees and orders arising
thereunder.
ERISA Affiliate. Any Person which is treated as a single employer
with the Borrower under Section 414 of the Code.
ERISA Reportable Event. A reportable event with respect to a
Guaranteed Pension Plan within the meaning of Section 4043 of ERISA and
the regulations promulgated thereunder as to which the requirement of
notice has not been waived.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any lender
subject thereto would be required to maintain reserves under Regulation D
of the Board of Governors of the Federal Reserve System (or any successor
or similar regulations relating to such reserve requirements) against
"Eurocurrency Liabilities" (as that term is used in Regulation D), if
such liabilities were outstanding. The Eurocurrency Reserve Rate shall
be adjusted automatically on and as of the effective date of any change
in the Eurocurrency Reserve Rate.
Eurodollar Business Day. Any day on which commercial banks are open
for international business (including dealings in Dollar deposits) in
London or such other eurodollar interbank market as may be selected by
the Agent in its sole discretion acting in good faith.
Eurodollar Lending Office. Initially, the office of each Bank
designated as such in Schedule 1 hereto; thereafter, such other office of
such Bank, if any, that shall be making or maintaining Eurodollar Rate
Loans.
-9-
Eurodollar Rate. For any Interest Period with respect to a
Eurodollar Rate Loan, the rate of interest equal to (i) the arithmetic
average of the rates per annum for BKB (rounded upwards to the nearest
1/16 of one percent) of the rate at which BKB's Eurodollar Lending Office
is offered Dollar deposits two Eurodollar Business Days prior to the
beginning of such Interest Period in the interbank eurodollar market
where the eurodollar and foreign currency and exchange operations of such
Eurodollar Lending Office are customarily conducted at or about 10:00
a.m., Boston time, for delivery on the first day of such Interest Period
for the number of days comprised therein and in an amount comparable to
the amount of the Eurodollar Rate Loan of BKB to which such Interest
Period applies, divided by (ii) a number equal to 1.00 minus the
Eurocurrency Reserve Rate, if applicable.
Eurodollar Rate Loans. Any Syndicated Loans bearing interest
calculated by reference to the Eurodollar Rate.
Event of Default. See Section 11.
Fee Letters. The Agent's Fee Letter and the Documentation Agent's
Fee Letter.
generally accepted accounting principles. (i) When used in Section
8, whether directly or indirectly through reference to a capitalized term
used therein, means (A) principles that are consistent with the
principles promulgated or adopted by the Financial Accounting Standards
Board and its predecessors, in effect for the fiscal year ended on the
Balance Sheet Date, and (B) to the extent consistent with such
principles, the accounting practice of the Borrower reflected in its
financial statements for the year ended on the Balance Sheet Date, and
(ii) when used in general, other than as provided above, means principles
that are (A) consistent with the principles promulgated or adopted by the
Financial Accounting Standards Board and its predecessors, as in effect
from time to time and (B) consistently applied with past financial
statements of the Borrower adopting the same principles, provided that in
each case referred to in this definition of "generally accepted
accounting principles" a certified public accountant would, insofar as
the use of such accounting principles is pertinent, be in a position to
deliver an unqualified opinion (other than a qualification regarding
changes in generally accepted accounting principles) as to financial
statements in which such principles have been properly applied.
Guaranteed Pension Plan. Any employee pension benefit plan within
the meaning of Section 3(2) of ERISA maintained or contributed to by the
Borrower or any ERISA Affiliate the benefits of which are guaranteed on
-10-
termination in full or in part by the PBGC pursuant to Title IV of ERISA,
other than a Multiemployer Plan.
Guaranty. A Guaranty entered into by a Subsidiary of the Borrower
pursuant to Section 7.5.1 or, as the case may be, Section 7.11 hereof,
pursuant to which such Subsidiary guaranties to the Banks and the Agent
the payment and performance of the Obligations, each in substantially the
form of Exhibit A hereto.
Hazardous Substances. See Section 5.18(b).
Indebtedness. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be
classified upon the obligor's balance sheet as liabilities, including in
any event and whether or not so classified: (i) all debt and similar
monetary obligations, whether direct or indirect; (ii) all liabilities
secured by any mortgage, pledge, security interest, lien, charge, or
other encumbrance existing on property owned or acquired subject thereto,
whether or not the liability secured thereby shall have been assumed; and
(iii) all guarantees, endorsements and other contingent obligations
whether direct or indirect in respect of indebtedness of others,
including any obligation to supply funds to or in any manner to invest
in, directly or indirectly, the debtor, to purchase indebtedness, or to
assure the owner of indebtedness against loss, through an agreement to
purchase goods, supplies, or services for the purpose of enabling the
debtor to make payment of the indebtedness held by such owner or
otherwise, and the obligations to reimburse the issuer in respect of any
letters of credit.
Ineligible Securities. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16
of the Banking Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
Interest Payment Date. (i) As to any Base Rate Loan, the last day
of the calendar quarter which includes the Drawdown Date thereof; (ii) as
to any Competitive Bid Loan, on the last day of the Interest Period
applicable thereto; (iii) as to any Eurodollar Rate Loan, the last day of
such Interest Period.
Interest Period. With respect to each Loan, (i) initially, the
period commencing on the Drawdown Date of such Loan and ending on the
last day of one of the periods set forth below, as selected by the
Borrower in a Loan Request or Notice of Competitive Bid Borrowing (A) for
any Base Rate Loan, the last day of the calendar quarter; (B) for any
Competitive Bid Loan, from 7 through 180 days; and (C) for any Eurodollar
Rate Loan, 1, 2, 3 or 6 months; and (ii) thereafter, each period
commencing on the last
-11-
day of the next preceding Interest Period applicable to such Loan and
ending on the last day of one of the periods set forth above, as selected
by the Borrower in a Conversion Request; provided that all of the
foregoing provisions relating to Interest Periods are subject to the
following:
(a) if any Interest Period with respect to a Eurodollar Rate Loan
would otherwise end on a day that is not a Eurodollar Business Day, that
Interest Period shall be extended to the next succeeding Eurodollar
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Eurodollar Business Day;
(b) if any Interest Period with respect to a Base Rate Loan would
end on a day that is not a Business Day, that Interest Period shall end
on the next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in
Section 2.8, the Borrower shall be deemed to have requested a conversion
of the affected Eurodollar Rate Loan to a Base Rate Loan and the
continuance of all Base Rate Loans as Base Rate Loans on the last day of
the then current Interest Period with respect thereto;
(d) any Interest Period that begins on the last Eurodollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Eurodollar Business Day of a calendar
month; and
(e) any Interest Period relating to any Loan that would otherwise
extend beyond the Revolving Credit Loan Maturity Date shall end on the
Revolving Credit Loan Maturity Date.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness
of, or for loans, advances, capital contributions or transfers of
property to, or in respect of any guaranties (or other commitments as
described under Indebtedness), or obligations of, any Person. In
determining the aggregate amount of Investments outstanding at any
particular time: (i) the amount of any Investment represented by a
guaranty shall be taken at not less than the principal amount of the
obligations guaranteed and still outstanding; (ii) there shall be
included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is
paid; (iii) there shall be deducted in respect of each such Investment
any amount received as a return of capital (but only
-12-
by repurchase, redemption, retirement, repayment, liquidating dividend or
liquidating distribution); (iv) there shall not be deducted in respect of
any Investment any amounts received as earnings on such Investment,
whether as dividends, interest or otherwise, except that accrued interest
included as provided in the foregoing clause (ii) may be deducted when
paid; and (v) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof.
Invitation for Competitive Bid Quotes. See Section 2.3.1(c) hereof.
Loan Documents. This Credit Agreement, the Notes, the Fee Letters,
any Guaranty and all documents evidencing or relating to any interest
rate protection arrangements entered into between the Borrower and any
Bank.
Loan Request. See Section 2.2.
Loans. Revolving credit loans made or to be made by the Banks to
the Borrower pursuant to Section 2 hereof, whether Syndicated Loans or
Competitive Bid Loans.
Majority Banks. As of any date, the Banks holding at least sixty
percent (60%) of the outstanding principal amount of the Notes on such
date; and if no such principal is outstanding, the Banks whose aggregate
Commitments constitutes at least sixty percent (60%) of the Total
Commitment.
Margin Stock. "Margin Stock" or "Margin Securities", as such terms
are used in Regulations U and X of the Board of Governors of the Federal
Revenue System, 12 C.F.R. Parts 221 and 224.
Multiemployer Plan. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate.
Notes. The Competitive Bid Notes and the Syndicated Notes.
Notice of Competitive Bid Borrowing. See Section 2.3.1(f) hereof.
Obligations. All indebtedness, obligations and liabilities of any
of the Borrower and its Subsidiaries to any of the Banks and the Agent,
individually or collectively, existing on the date of this Credit
Agreement or arising thereafter, direct or indirect, joint or several,
absolute or contingent, matured or unmatured, liquidated or unliquidated,
secured or unsecured, arising by contract, operation of law or otherwise,
arising or incurred under this Credit Agreement or any of the other Loan
Documents
-13-
(including any interest rate protection arrangements entered into between
the Borrower and any Bank), or in respect of any of the Loans or any of
the Notes or other instruments at any time evidencing any thereof.
Original Credit Agreement. As defined in the preamble.
outstanding. With respect to the Loans, the aggregate unpaid
principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section
4002 of ERISA and any successor entity or entities having similar
responsibilities.
Permitted Liens. Liens, security interests and other encumbrances
permitted by Section 7.2.
Permitted Acquisition. The Rapidforms Acquisition or any other
acquisition of any Person, business, division, or specified group of
assets by the Borrower or any of its Subsidiaries, provided that, with
respect to any other such acquisition, (1) the Agent and the Majority
Banks approve, in their sole discretion, such acquisition in writing in
advance or (2) each of the following conditions is met:
(a) immediately prior to and after, and after giving effect to,
such acquisition, no Default or Event of Default shall then exist;
(b) (i) the aggregate consideration paid or to be paid by the
Borrower or any of its Subsidiaries in connection with all such
acquisitions (whether in the form of cash or the assumption of
Indebtedness for borrowed money, debt or other similar monetary
obligations by the Borrower or any of its Subsidiaries (including such
Indebtedness in existence prior to the date of any such acquisition which
was not incurred in connection with or contemplation thereof but
excluding stock consideration) shall not exceed $5,000,000 and (ii) the
aggregate consideration paid or to be paid by the Borrower or any of its
Subsidiaries in connection with all such acquisitions, including
consideration of the types described in clause (b) (i) of this definition
and stock consideration (as valued for the purpose of such acquisitions)
shall not exceed $10,000,000;
(c) such acquisition shall have been approved by the board of
directors and shareholders, if required, of such Person;
(d) either (i) such acquisition is the acquisition of assets only
(for use in substantially the same line of business as the line of
business of the Borrower) or (ii) such acquisition involves the
-14-
purchase of the capital stock or other equity interests of a Person and
each of the following conditions is met:
(A) such acquisition is the acquisition of one hundred percent
(100%) of the capital stock or other equity interests of such Person.
(B) such Person is in substantially the same line of business
as the Borrower,
(C) The Borrower or a wholly owned Subsidiary of the Borrower
is the survivor of any merger or consolidation with such Person;
(D) not less than ten (10) Business Days prior to such
acquisition, the Borrower shall notify the Banks thereof, and
(E) contemporaneously with the occurrence of any such
acquisition, the Borrower shall (I) cause such Person to guaranty all of
the Obligations hereunder pursuant to a Guaranty in form and substance
satisfactory to the Agent, which such Guaranty shall be a Loan Document
hereunder, and (II) cause such Person to deliver to the Banks and the
Agent (aa) evidence of proper corporate authorization, and (bb) legal
opinions with respect to each of the matters and documents set forth in
this clause (D), in each case, in form and substance satisfactory to the
Agent and the Banks; and
(e) the Agent shall have received each of the following , each in
form and substance satisfactory to the Agent: (i) a compliance
certificate evidencing pro forma compliance with the requirements of
Section 8 hereof following the consummation of any such acquisition, (ii)
due diligence summaries evidencing the Borrower's due diligence with
respect to the Person or assets being acquired and (iii) such other
information, including financial statements, as the Agent or the Majority
Banks may request.
Person. Any individual, corporation, partnership, trust,
unincorporated association, business, or other legal entity, and any
government or any governmental agency or political subdivision thereof.
Rapidforms. Rapidforms, Inc., a New Jersey corporation.
Rapidforms Acquisition. The acquisition by the Borrower of one
hundred percent (100%) of the capital stock of Rapidforms and its
Subsidiaries on the terms and conditions set forth below:
-15-
(i) the closing of the Rapidforms Acquisition shall occur on or
before, but not after, January 30, 1998;
(ii) the terms and conditions of the Rapidforms Acquisition
shall be substantially those set forth in the Rapidforms Stock Purchase
Agreement. Without limiting the generality of the foregoing, (A) the
Initial Purchase Price (as defined in the Rapidforms Stock Purchase
Agreement) shall not exceed $80,000,000, (B) the price (the "Final
Purchase Price") to which the Initial Purchase Price is, or may be,
increased pursuant to Section 2.05 of the Rapidforms Stock Purchase
Agreement shall not exceed $82,500,000, (C) neither Rapidforms nor any of
its Subsidiaries shall have, nor shall the Borrower have assumed, any
indebtedness for borrowed money, debt or other similar monetary
obligations, including guaranties of the obligations of others (with the
guaranty obligations of Rapidforms and each of its Subsidiaries in
respect of the Amended and Restated Loan Agreement dated July 21, 1997
among CSS Industries, Inc., CoreStates Bank, N.A. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
being released in their entirety prior to the consummation of the
Rapidforms Acquisition) in excess of $1,250,000 in the aggregate, and (D)
the Borrower shall have acquired one hundred percent (100%) of the
capital stock of each of Rapidforms and its Subsidiaries;
(iii) there shall be no material adverse change in the
environmental status of the real properties of Rapidforms and/or its
Subsidiaries from that described in the preliminary updates of Phase I
site assessments attached hereto as Exhibit I, with any additional
disclosures arising from additional investigation by the consultants
preparing such Phase I site assessments being deemed to constitute
changes from such preliminary updates;
(iv) there shall be no material misstatements in or omissions
from the materials furnished to the Agent, the Banks and the Arranger for
their review in connection with the Rapidforms Acquisition;
(v) upon consummation of the Rapidforms Acquisition, the stock
and assets of Rapidforms and its Subsidiaries shall be free and clear of
any and all liens and encumbrances (other than purchase money security
interests on equipment, equipment leases, the mortgage of the real
property located in Bridgeton, New Jersey securing
-16-
obligations under the Trust Indenture and other liens on personal
property securing obligations under the Trust Indenture as revealed by
the UCC search results regarding Rapidforms and its Subsidiaries
delivered by the Borrower to the Agent prior to the execution of the
Rapidforms Stock Purchase Agreement;
(vi) promptly following the consummation of the Rapidforms
Acquisition, the Borrower shall deliver to the Agent revisions to the
disclosure schedules attached to this Credit Agreement and the other Loan
Documents, and an updated certificate of locations of the Borrower and
its Subsidiaries, in each case reflecting the materials disclosed by the
Rapidforms Stock Purchase Agreement; and
(vii) all parties to the Rapidforms Stock Purchase Agreement
shall have received all necessary consent and approvals.
Rapidforms Stock Purchase Agreement. The Rapidforms Stock Purchase
Agreement between the Borrower and CSS Industries, Inc. dated as of
December 5, 1997.
Real Estate. All real property at any time owned or leased (as
lessee or sublessee) by the Borrower or any of its Subsidiaries.
Record. The grid attached to a Note, or the continuation of such
grid, or any other similar record, including computer records, maintained
by any Bank with respect to any Loan referred to in such Note.
Revolving Credit Loan Maturity Date. December 18, 2002.
Section 20 Subsidiary. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible
Securities.
Subsidiary. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by
number of votes) of the outstanding Voting Stock.
Syndicated Loan(s). See Section 2.1 hereof.
Syndicated Note. See Section 2.5.1 hereof.
-17-
Total Commitment. The sum of the Commitments of the Banks, as in
effect from time to time, which amount shall, as of the Closing Date, be
$135,000,000, but which may be increased to $165,000,000 upon the terms
and conditions set forth in Section 2.9 hereof.
Trust Indenture. The Trust Indenture dated as of December 1, 1988
by and among the New Jersey Economic Development Authority, New Jersey
National Bank, as Trustee, and Chemical Bank, as Tender Agent.
Type. As to any Syndicated Loan, its nature as a Base Rate Loan or
a Eurodollar Rate Loan.
Voting Stock. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as
such holders, to vote for the election of a majority of the directors (or
persons performing similar functions) of the corporation, association,
trust or other business entity involved, whether or not the right so to
vote exists by reason of the happening of a contingency.
1.2 Rules of Interpretation.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification
to such law.
(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) Accounting terms not otherwise defined herein have the meanings
assigned to them by generally accepted accounting principles applied on a
consistent basis by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of
-18-
Massachusetts, have the meanings assigned to them therein, with the term
"instrument" being that defined under Article 9 of the Uniform Commercial
Code.
(h) Reference to a particular "Section " refers to that section of
this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.
2. THE REVOLVING CREDIT FACILITY.
---------------------------------
2.1 Commitment to Lend Syndicated Loans. Subject to the terms
and conditions set forth in this Credit Agreement, each of the Banks
severally agrees to lend to the Borrower and the Borrower may borrow,
repay, and reborrow from time to time between the Closing Date and the
Revolving Credit Loan Maturity Date upon notice by the Borrower to the
Agent given in accordance with Section 2.2, such sums ("Syndicated
Loans") as are requested by the Borrower up to a maximum aggregate
principal amount outstanding (after giving effect to all amounts
requested) at any one time equal to such Bank's Commitment (without
regard to any Competitive Bid Loans of such Bank outstanding at such
time), provided that (i) the sum of the outstanding amount of the
Syndicated Loans (after giving effect to all amounts requested) plus the
outstanding aggregate principal amount of all Competitive Bid Loans made
by all Banks shall not at any time exceed the Total Commitment and (ii)
at all times the outstanding aggregate principal amount of all Syndicated
Loans made by each Bank shall equal such Bank's Commitment Percentage of
the outstanding aggregate principal amount of all Syndicated Loans made
pursuant to the terms of this Credit Agreement. The Syndicated Loans
shall be made pro rata in accordance with each Bank's Commitment
Percentage. Each request for a Syndicated Loan hereunder shall
constitute a representation and warranty by the Borrower that the
conditions set forth in Section 9 and Section 10, in the case of the
initial Syndicated Loans to be made on the Closing Date, and Section 10,
in the case of all other Syndicated Loans, have been satisfied on the
date of such request.
2.2 Requests for Loans. The Borrower shall give to the Agent
written notice in the form of Exhibit B hereto (or telephonic notice
confirmed in a writing in the form of Exhibit B hereto) of each
Syndicated Loan requested hereunder (a "Loan Request") by 10:00 a.m. (i)
on the proposed Drawdown Date of any Base Rate Loan and (ii) two (2)
Eurodollar Business Days prior to the proposed Drawdown Date of any
Eurodollar Rate Loan. Each such notice shall specify (A) the principal
-19-
amount of the Syndicated Loan requested, (B) the proposed Drawdown Date
of such Syndicated Loan, (C) the Interest Period for such Syndicated Loan
and (D) the Type of such Syndicated Loan. Promptly upon receipt of any
such notice, the Agent shall notify each of the Banks thereof. Each such
notice shall be irrevocable and binding on the Borrower and shall
obligate the Borrower to accept the Syndicated Loan requested from the
Banks on the proposed Drawdown Date. Each Loan Request shall be in a
minimum aggregate amount of $1,000,000 or any integral multiple of
$500,000 in excess thereof.
2.3 Competitive Bid Loans.
2.3.1 Competitive Bid Borrowings. (a) The Competitive Bid Option.
In addition to the Syndicated Loans permitted to be made hereunder
pursuant to Section 2.1 hereof, the Borrower may, from time to time from
the Closing Date until the Revolving Credit Loan Maturity Date pursuant
to the terms of this Section 2.3, cause the Agent to request the Banks to
make offers to fund Competitive Bid Loans to the Borrower from time to
time prior to the Revolving Credit Loan Maturity Date. The Banks may,
but shall have no obligation to, make such offers and the Borrower may,
but shall have no obligation to, accept such offers in the manner set
forth in this Section 2.3. Each Bank may make Competitive Bid Loans in
an aggregate amount (after giving effect to all amounts requested) not to
exceed the lesser of $20,000,000 and the Total Commitment, provided that
the aggregate amount of all outstanding Syndicated Loans (after giving
effect to all amounts requested) plus the aggregate amount of all
outstanding Competitive Bid Loans (after giving effect to all amounts
requested) shall at no time exceed the Total Commitment.
(b) Competitive Bid Quote Request. When the Borrower wishes to
request offers to make Competitive Bid Loans under this Section 2.3, it
shall transmit to the Agent by telex or facsimile a Competitive Bid Quote
Request substantially in the form of Exhibit C attached hereto (a
"Competitive Bid Quote Request") so as to be received no later than 1:00
p.m. (Boston time) on the Business Day prior to the requested Drawdown
Date, specifying (i) the requested Drawdown Date (which must be a
Business Day), (ii) the amount of such Competitive Bid Loan (which must
be a minimum of $1,000,000 or any greater integral multiple of $500,000
and may not exceed the Total Commitment), and (iii) the Interest Period
of such Competitive Bid Loan (which may not extend beyond the Revolving
Credit Loan Maturity Date). Contemporaneously with the transmission of
each Competitive Bid Quote Request, the Borrower shall pay to the Agent,
for the Agent's own account, a work fee
-20-
in the amount of $750. The Borrower may request offers to make
Competitive Bid Loans for one amount and three Interest Periods in a
single Competitive Bid Quote Request.
(c) Invitation for Competitive Bid Quotes; Alternative Manner of
Auction. Subsequent to timely receipt of a Competitive Bid Quote
Request, the Agent shall send to the Banks by telex or facsimile an
Invitation for Competitive Bid Quotes substantially in the form of
Exhibit D attached hereto (an "Invitation for Competitive Bid Quotes"),
as promptly as possible but not later than 3:00 p.m. (Boston time) on the
Business Day prior to the requested Drawdown Date which shall constitute
an invitation by the Borrower to each Bank to submit Competitive Bid
Quotes offering to make Competitive Bid Loans to which such Competitive
Bid Quote Request relates in accordance with this Section 2.3. If, after
receipt by the Agent of a Competitive Bid Quote Request from the Borrower
in accordance with subsection (b) of this Section 2.3.1, the Agent or any
Bank shall be unable to complete any procedure of the auction process
described in subsections (c) through (f) (inclusive) of this Section
2.3.1 due to the inability of such Person to transmit or receive
communications through the means specified therein, such Person may rely
on telephonic notice for the transmission or receipt of such
communications. In any case where such Person shall rely on telephone
transmission or receipt, any communication made by telephone shall, as
soon as possible thereafter, be followed by written confirmation thereof.
(d) Submission and Contents of Competitive Bid Quotes.
(i) Each Bank may submit a Competitive Bid Quote containing an
offer or offers to make Competitive Bid Loans in response to any
Invitation for Competitive Bid Quotes. Each Competitive Bid Quote must
comply with the requirements of this subsection (d) and must be submitted
to the Agent by telex or facsimile not later than 10:00 a.m. (Boston
time) on the requested Drawdown Date, provided that Competitive Bid
Quotes may be made by the Agent in its capacity as a Bank only if it
notifies the Borrower of the terms of its Competitive Bid Quote no later
than 9:30 a.m. (Boston time) on the requested Drawdown Date. Subject to
the provisions of Section Section 9, 10 and 11 hereof, any Competitive
Bid Quote so made shall be irrevocable except with the written consent of
the Agent given on the instructions of the Borrower.
-21-
(ii) Each Competitive Bid Quote shall be in substantially the
form of Exhibit E-1 attached hereto (a "Competitive Bid Quote") and shall
in any case specify:
(A) the requested Drawdown Date and Interest Periods,
(B) the principal amount of the Competitive Bid Loan for
which each such offer is being made, which principal amount (x) may be
greater than the Commitment Amount of the quoting Bank but may not exceed
the Total Commitment, (y) must be $1,000,000 or a larger multiple of
$500,000 and (z) may not exceed the aggregate principal amount of
Competitive Bid Loans for which offers were requested,
(C) the rate of interest per annum (rounded to the
nearest 1/1000th of 1%) (the "Competitive Bid Rate") offered for each
such Competitive Bid Loan, and
(D) the identity of the quoting Bank.
(iii) Any Competitive Bid Quote shall be disregarded if it:
(A) is not substantially in the form of Exhibit E-1
attached hereto or does not specify all of the information required by
subsection (d)(ii) of this Section 2.3.1;
(B) contains qualifying, conditional or similar language
(except that it may, in the case of a quote relating to more than one
Interest Period, contain the condition that the Bank will fund any one,
but not more, of the Competitive Bid Loans offered in such Competitive
Bid Quote);
(C) proposes terms other than or in addition to those set
forth in the applicable Invitation for Competitive Bid Quotes; or
(D) arrives after the time set forth in subsection (d)(i)
of this Section 2.3.1.
(e) Notice to Borrower. Not later than 10:30 a.m. (Boston time) on
the requested Drawdown Date, the Agent shall notify the Borrower of the
terms of all Competitive Bid Quotes submitted by
-22-
the Banks in accordance with subsection (d) of this Section 2.3.1. The
Agent's notice to the Borrower shall specify (i) the aggregate principal
amount of Competitive Bid Loans for which offers have been received for
each Interest Period specified in the related Competitive Bid Quote
Request, and (ii) the respective principal amounts and Competitive Bid
Rates so offered.
(f) Acceptance and Notice by Borrower. Not later than 11:00 a.m.
(Boston time) on the requested Drawdown Date, the Borrower shall notify
the Agent, and the Agent shall promptly notify each Bank with respect to
its offer, of the Borrower's acceptance or non-acceptance of the offers
of which it was notified pursuant to subsection (e) of this Section
2.3.1. In the case of an acceptance, such notice shall (i) be
substantially in the form of Exhibit E-2 attached hereto (a "Notice of
Competitive Bid Borrowing"), (ii) be irrevocable by the Borrower, and
(iii) specify the aggregate principal amount of offers for each Interest
Period that are accepted. Each acceptance by the Borrower of Competitive
Bid Loans hereunder shall constitute a representation and warranty by the
Borrower that the conditions set forth in Section Section 9 and 10 hereof
have been satisfied on the date of such acceptance. The Borrower may
accept any Competitive Bid Quote in whole or in part; provided that:
(A) the aggregate principal amount of each Competitive Bid
Loan may not exceed the applicable amount set forth in the related
Competitive Bid Quote Request,
(B) the aggregate principal amount of each Competitive Bid
Loan must be $1,000,000 or a larger multiple of $500,000, and
(C) acceptance of offers may only be made on the basis of
ascending Competitive Bid Rates.
(g) Allocation by Agent; Usage of Commitments. If offers are made
by two or more Banks with the same Competitive Bid Rates, for a greater
aggregate principal amount than the amount in respect of which offers are
accepted for the related Interest Period, the principal amount of
Competitive Bid Loans in respect of which such offers are accepted shall
be allocated by the Agent among such Banks as nearly as possible (in such
multiples, not less than $100,000 as the Agent may deem appropriate) in
proportion to the aggregate principal amounts of such offers. If any
such Bank has indicated a minimum acceptable Competitive Bid Loan in its
-22-
Competitive Bid Request, and under the procedures of this subsection
(g), the Agent would have allocated to it an amount less than such
minimum, such Competitive Bid Quote will instead be deemed to have been
withdrawn. Determination by the Agent of the amounts of Competitive Bid
Loans and the allocation thereof shall be conclusive in the absence of
manifest error. The Agent shall, promptly after the funding of any
Competitive Bid Loan, notify the Banks thereof pursuant to a notice
substantially in the form of Exhibit E-3 attached hereto.
(h) Funding of Competitive Bid Loans. If, on or prior to the
Drawdown Date of any Competitive Bid Loan, the Total Commitment has not
terminated in full and if, on such Drawdown Date, the applicable
conditions of Section Section 4 and 10 hereof are satisfied, the Bank or
Banks whose offers the Borrower has accepted will fund each Competitive
Bid Loan so accepted as provided in Section 2.4.1 hereof.
2.3.2 Maximum Competitive Bid Loans; Funding Losses. (a)
Notwithstanding any other provision herein to the contrary, at no time
shall the aggregate principal amount of Competitive Bid Loans outstanding
at any time exceed the lesser of (i) the Total Commitment minus the
aggregate principal amount of Syndicated Loans outstanding at such time
and (ii) $20,000,000.
(b) If after acceptance of any Competitive Bid Quote pursuant to
Section 2.3.1(f) hereof, the Borrower fails to borrow any Competitive Bid
Loan so accepted on the date specified therefor, the Borrower shall
indemnify the Bank funding such Loan against any loss or expense incurred
by reason of the liquidation or reemployment of deposits or other funds
acquired by such Bank to fund or maintain such unborrowed Competitive Bid
Loans, including, without limitation, compensation as provided in Section
4.10 hereof.
2.3.3 Repayment of Competitive Bid Loans. The principal of each
Competitive Bid Loan shall become absolutely due and payable by the
Borrower on the last day of the Interest Period relating thereto, and the
Borrower hereby absolutely and unconditionally promises to pay to the
Agent, for the accounts of the relevant Banks, on the last day of the
Interest Period relating thereto the principal amount of all such
Competitive Bid Loans plus interest thereon at the applicable Competitive
Bid Rate. Subject to the terms of this Credit Agreement, the Borrower
may reborrow any amounts so repaid from time to time prior to the
Revolving Credit Loan Maturity Date.
-24-
2.4 Funds for Loans.
2.4.1 Funding Procedures. Not later than 1:30 p.m. (Boston time)
on the proposed Drawdown Date of any Syndicated Loans or Competitive Bid
Loans, as applicable, each of the relevant Banks will make available to
the Agent, at the Agent's Head Office, in immediately available funds,
the amount of such Bank's Commitment Percentage of the amount of the
requested Syndicated Loans or the amount of such Bank's Competitive Bid
Loan, as applicable. Upon receipt from each Bank of such amount, and
upon receipt of the documents required by Section Section 9 and 10 hereof
and the satisfaction of the other conditions set forth therein, to the
extent applicable, the Agent will make available to the Borrower the
aggregate amount of such Loans made available to the Agent by the
relevant Banks. The failure or refusal of any Bank to make available to
the Agent its Commitment Percentage of the requested Syndicated Loans on
any Drawdown Date shall not excuse any other Bank from making available
to the Agent the amount of such other Bank's Commitment Percentage of any
requested Syndicated Loans.
2.4.2 Advances by Agent. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has
made available to the Agent on such Drawdown Date the amount of such
Bank's Commitment Percentage of the Syndicated Loans (or, in the case of
Competitive Bid Loans, the amount of such Bank's accepted offers of
Competitive Bid Loans, if any) to be made on such Drawdown Date, and the
Agent may (but it shall not be required to), in reliance upon such
assumption, make available to the Borrower a corresponding amount. If
any Bank makes available to the Agent such amount on a date after such
Drawdown Date, such Bank shall pay to the Agent on demand an amount equal
to the product of (a) the average computed for the period referred to in
clause (c) below, of the weighted average interest rate paid by the Agent
for federal funds acquired by the Agent during each day included in such
period, times (b) the amount of such Bank's Commitment Percentage of such
Syndicated Loans (or accepted offers of Competitive Bid Loans, as
applicable), times (c) a fraction, the numerator of which is the number
of days that elapse from and including such Drawdown Date to the date on
which the amount of such Bank's Syndicated Loans or Competitive Bid
Loans, as applicable, shall become immediately available to the Agent,
and the denominator of which is 365. A statement of the Agent submitted
to such Bank with respect to any amounts owing under this Section 2.4.2
shall be prima facie evidence of the amount due and owing to the Agent by
such Bank. If the amount of such Bank's
-25-
Syndicated Loans or Competitive Bid Loans, as applicable, is not made
available to the Agent by such Bank within three (3) Business Days
following such Drawdown Date, the Agent shall be entitled to recover such
amount from the Borrower on demand, with interest thereon at the rate per
annum applicable to the Syndicated Loans or Competitive Bid Loans, as
applicable, made on such Drawdown Date. Any payment by the Borrower to
the Agent of any Syndicated Loans or Competitive Bid Loans pursuant to
this Section 2.4.2 shall be deemed to be a payment of the Loans that were
to be made by the Bank that failed to make such Syndicated Loans or
Competitive Bid Loans, as applicable.
2.5 The Notes.
2.5.1 Syndicated Notes. The Syndicated Loans shall be evidenced
by separate promissory notes of the Borrower in substantially the form of
Exhibit F-1 attached hereto (each a "Syndicated Note"), dated as of the
Closing Date and completed with appropriate insertions. A Syndicated
Note shall be payable to the order of each Bank in a principal amount
equal to such Bank's Commitment Amount or, if less, the outstanding
amount of all Syndicated Loans made by such Bank, plus interest accrued
thereon, as set forth below. The Borrower irrevocably authorizes each
Bank to make, at or about the time of the Drawdown Date of any Syndicated
Loan or at the time of receipt of any payment of principal on such Bank's
Syndicated Note, an appropriate notation on the Record attached to such
Bank's Syndicated Note reflecting the making of such Syndicated Loan or
(as the case may be) the receipt of such payment. The outstanding amount
of the Syndicated Loans set forth on such Bank's Record shall be prima
facie evidence of the principal amount thereof owing and unpaid to such
Bank, but the failure to record, or any error in so recording, any such
amount on such Bank's Record shall not limit or otherwise affect the
obligations of the Borrower hereunder or under any Syndicated Note to
make payments of principal of or interest on any Syndicated Note when
due.
2.5.2 Competitive Bid Notes. The Competitive Bid Loans shall be
evidenced by separate promissory notes of the Borrower in substantially
the form of Exhibit F-2 attached hereto (each a "Competitive Bid Note"),
dated as of the Closing Date and completed with appropriate insertions.
A Competitive Bid Note shall be payable to the order of each Bank in a
principal amount equal to $20,000,000, or if less, the outstanding amount
of all Competitive Bid Loans made by such Bank to the Borrower hereunder,
as set
-26-
forth in Section 2.3 hereof, plus interest accrued thereon, as set forth
below. The Borrower irrevocably authorizes each Bank to make, at or
about the time of the Drawdown Date of any Competitive Bid Loan made by
such Bank or at the time of receipt of the payment of principal of such
Competitive Bid Loan, an appropriate notation on the Record attached to
such Bank's Competitive Bid Note reflecting the making of such
Competitive Bid Loan and repayments thereof. All such notations shall
constitute prima facie evidence of the amount of such Competitive Bid
Loans and the repayments thereof, but the failure to record, or any error
in so recording such amount on such Bank's Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Competitive Bid Note to make payments of principal or interest on any
Competitive Bid Note when due.
2.6 Reduction of Total Commitment. The Borrower shall have the
right at any time and from time to time upon five (5) Business Days prior
written notice to the Agent to reduce by $1,000,000 or an integral
multiple thereof or terminate entirely the unborrowed portion of the
Total Commitment, whereupon the Commitments of the Banks shall be reduced
pro rata in accordance with their respective Commitment Percentages of
the amount specified in such notice or, as the case may be, terminated.
Promptly after receiving any notice of the Borrower delivered pursuant to
this Section 2.6, the Agent will notify the Banks of the substance
thereof. Upon the effective date of any such reduction or termination,
the Borrower shall pay to the Agent for the respective accounts of the
Banks the full amount of any commitment fee then accrued on the amount of
the reduction. No reduction or termination of the Commitments or of the
Total Commitment may be reinstated.
2.7 Interest on Loans. Except as otherwise provided in Section
4.11,
(a) Each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at the Base Rate.
(b) Each Eurodollar Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at a rate per annum equal to the
sum of the Applicable Eurodollar Rate Margin plus the Eurodollar Rate
determined for such Interest Period.
(c) Each Competitive Bid Loan shall bear interest at the rate per
annum specified in the applicable Competitive Bid Quote with respect to
such Competitive Bid Loan.
-27-
(d) The Borrower promises to pay interest on each Loan in arrears
on each Interest Payment Date with respect thereto.
(e) The Borrower shall not request any Eurodollar Rate Loans with
an Interest Period in excess of one (1) month hereunder and the Banks
shall not be required to make any Eurodollar Rate Loans with an Interest
Period in excess of one (1) month hereunder until the earlier of (a)
January 31, 1998, and (b) the date upon which the Agent advises the
Borrower that the Arranger has completed the syndication of the Loans
hereunder in a manner satisfactory to the Agent and the Arranger;
provided, however, that with respect to (i) any Eurodollar Rate Loans
made in accordance with the requirements of this sentence and (ii) any
Eurodollar Rate Loans outstanding on the Closing Date, the Borrower shall
convert such Eurodollar Rate Loans to Base Rate Loans on any date on
which the Agent notifies the Borrower that it and the Arranger will be
completing the syndication of the Loans, and the Borrower shall pay any
costs or expenses associated therewith in accordance with the
requirements of Section 4.10.
2.8 Conversion Options.
2.8.1 Conversion to Different Type of Syndicated Loan. The
Borrower may elect from time to time to convert any outstanding
Syndicated Loan to a Syndicated Loan of another Type, provided that (i)
with respect to any such conversion of a Syndicated Loan to a Base Rate
Loan, the Borrower shall give the Agent written notice of such election
by 10:00 a.m. on the proposed conversion date of such Syndicated Loan;
(ii) with respect to any such conversion of a Eurodollar Rate Loan into a
Base Rate Loan, such conversion shall only be made on the last day of the
Interest Period with respect thereto; (iii) with respect to any such
conversion of a Base Rate Loan to a Eurodollar Rate Loan, the Borrower
shall give the Agent at least two (2) Eurodollar Business Days' prior
written notice of such election and (iv) no Syndicated Loan may be
converted into a a Eurodollar Rate Loan when any Default or Event of
Default has occurred and is continuing. On the date on which such
conversion is being made, each Bank shall take such action as is
necessary to transfer its Commitment Percentage of such Syndicated Loans
to its Domestic Lending Office or its Eurodollar Lending Office, as the
case may be. All or any part of the outstanding Syndicated Loans of any
Type may be converted as provided herein, provided that partial
conversions shall be in an aggregate principal amount of $500,000 or a
whole multiple thereof. Each Conversion Request relating to
-28-
the conversion of a Syndicated Loan to a Eurodollar Rate Loan shall be
irrevocable by the Borrower.
2.8.2 Continuation of Type of Syndicated Loan. Any Syndicated
Loan of any Type may be continued as such upon the expiration of an
Interest Period with respect thereto by compliance by the Borrower with
the notice provisions contained in Section 2.8.1; provided that no
Eurodollar Rate Loan may be continued as such when any Default or Event
of Default has occurred and is continuing, but shall be automatically
converted to a Base Rate Loan on the last day of the first Interest
Period relating thereto ending during the continuance of any Default or
Event of Default of which the officers of the Agent active upon the
Borrower's account have actual knowledge. In the event that the Borrower
fails to provide any such notice with respect to the continuation of any
Eurodollar Rate Loan or Base Rate Loan as such, then such Eurodollar Rate
Loan shall be automatically converted to a Base Rate Loan on the last day
of the first Interest Period relating thereto, and such Base Rate Loan
shall be continued as a Base Rate Loan on the last day of the first
Interest Period relating thereto. The Agent shall notify the Banks
promptly when any such automatic conversion contemplated by this Section
2.8 is scheduled to occur.
2.8.3 Eurodollar Rate Loans. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurodollar Rate Loans having the same Interest
Period shall not be less than $1,000,000 or a whole multiple of $500,000
in excess thereof.
2.9 Limited Increase In Total Commitment. Unless a Default or
Event of Default has occurred and is continuing, the Borrower may request
that the Total Commitment be increased to $165,000,000 hereunder, subject
to the approval of the Agent, provided, however, that (i) any Bank which
is a party to this Credit Agreement prior to such increase may elect to
fund a share of the increase (as allocated by the Agent), thereby
increasing its Commitment hereunder, but no Bank shall be required to do
so, (ii) in the event that it becomes necessary to include a new Bank to
provide additional funding under this Section 2.9, such new Bank must be
reasonably acceptable to the Agent, and (iii) the Banks' Commitment
Percentages shall be correspondingly adjusted and Notes issued or amended
and such other changes shall be made to the Loan Documents, as necessary,
to reflect any such increase in the Total Commitment. Any such increase
(whether to $165,000,000 or to a lesser
amount) shall require, among other things, the satisfaction of such
conditions precedent as the Agent may require, including, without
limitation, the obtaining by any Bank of requisite internal approvals,
the Agent's receipt of evidence of applicable corporate authorization and
other corporate documentation from the Borrower and the legal opinion of
counsel to the Borrower, each in form and substance satisfactory to the
Agent, such Banks as are participating in such increase and the Borrower.
REPAYMENT OF THE LOANS.
-----------------------
3.1 Maturity. The Borrower promises to pay on the Revolving
Credit Loan Maturity Date, and there shall become absolutely due and
payable on the Revolving Credit Loan Maturity Date, all of the Loans
outstanding on such date, together with any and all accrued and unpaid
interest thereon.
3.2 Mandatory Repayments of Loans. If at any time the sum of the
outstanding amount of the Loans exceeds the Total Commitment, then the
Borrower shall immediately pay the amount of such excess to the Agent for
application to the Loans for the respective accounts of the Banks. Each
prepayment of Loans shall be allocated among the Banks, in proportion, as
nearly as practicable to the respective unpaid principal amount of each
Bank's Syndicated Note, with adjustments to the extent practicable to
equalize any prior payments or repayments not exactly in proportion, and
if no Syndicated Loans are outstanding, the Competitive Bid Loans, in
proportion, as nearly as practicable, to the unpaid principal amount of
each Bank's Competitive Bid Note. If at any time the sum of the
outstanding amount of the Competitive Bid Loans exceeds $20,000,000, then
the Borrower shall immediately pay the amount of such excess to the Agent
for application to the Competitive Bid Loans made by the Banks, in
proportion, as nearly as practicable, to the unpaid principal amount of
each Bank's Competitive Bid Note.
3.3 Optional Repayments of Syndicated Loans. The Borrower shall
have the right, at its election, to repay the outstanding amount of the
Syndicated Loans, as a whole or in part, at any time without penalty or
premium, provided that all prepayments of Eurodollar Rate Loans prior to
the end of the Interest Period relating thereto shall obligate the
Borrower to pay any breakage costs associated with such Eurodollar Rate
Loans in accordance with Section 4.10 hereof. The Borrower shall give
the Agent written notice, no later than 10:00 a.m., Boston time, (a) on
the Business Day of any proposed repayment pursuant to this Section 3.3
of Base Rate Loans, and (b) two (2) Eurodollar Business Days notice of
any proposed repayment pursuant to this Section 3.3 of Eurodollar Rate
Loans, in each case, specifying the proposed date of payment of such
Syndicated Loans and the
-30-
principal amount to be paid. Each such partial prepayment of the Loans
shall be in an integral multiple of $500,000, shall be accompanied by the
payment of accrued interest on the principal repaid to the date of
payment and shall be applied first to the principal of Base Rate Loans
and then to the principal of Eurodollar Rate Loans. Each partial
prepayment shall be allocated among the Banks, in proportion, as nearly
as practicable, to the respective unpaid principal amount of each Bank's
Syndicated Note, with adjustments to the extent practicable to equalize
any prior repayments not exactly in proportion.
CERTAIN GENERAL PROVISIONS.
---------------------------
4.1 Certain Fees.
4.1.1 Agent and Arranger Fees. The Borrower agrees to pay to
each of the Agent and the Arranger the fees described in the Agent's Fee
Letter, upon the terms and conditions set forth therein.
4.1.2 Documentation Agent's Fee. The Borrower agrees to pay to
the Documentation Agent the fees described in the Documentation Agent's
Fee Letter, upon the terms and conditions set forth therein.
4.2 Facility Fee. The Borrower agrees to pay to the Agent for
the accounts of the Banks in accordance with their respective Commitment
Percentages a facility fee calculated at the rate of the Applicable
Facility Fee Percentage on the average daily amount during each calendar
quarter or portion thereof from the Closing Date to the Revolving Credit
Loan Maturity Date of the Total Commitment during such calendar quarter.
The facility fee shall be payable quarterly in arrears on the first day
of each calendar quarter for the immediately preceding calendar quarter
commencing on the first such date following the date hereof, with a final
payment on the Revolving Credit Maturity Date or any earlier date on
which the Commitments shall terminate.
4.3 Funds for Payments.
4.3.1 Payments to Agent. All payments of principal, interest,
commitment fees and any other amounts due hereunder or under any of the
other Loan Documents shall be made to the Agent, for the respective
accounts of the Banks and the Agent, at the Agent's Head Office or at
such other location in the Boston, Massachusetts area that the Agent may
from time to time designate, in each case in immediately available funds.
-31-
4.3.2 No Offset, etc. All payments by the Borrower hereunder and
under any of the other Loan Documents shall be made without setoff or
counterclaim and free and clear of and without deduction for any taxes,
levies, imposts, duties, charges, fees, deductions, withholdings,
compulsory loans, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the
Borrower is compelled by law to make such deduction or withholding. If
any such obligation is imposed upon the Borrower with respect to any
amount payable by it hereunder or under any of the other Loan Documents,
the Borrower will pay to the Agent, for the account of the Banks or (as
the case may be) the Agent, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such additional
amount in Dollars as shall be necessary to enable the Banks or the Agent
to receive the same net amount which the Banks or the Agent would have
received on such due date had no such obligation been imposed upon the
Borrower. The Borrower will deliver promptly to the Agent certificates
or other valid vouchers for all taxes or other charges deducted from or
paid with respect to payments made by the Borrower hereunder or under
such other Loan Document.
4.4 Computations. All computations of interest on Competitive
Bid Loans or Eurodollar Rate Loans and fees shall be based on a 360-day
year and paid for the actual number of days elapsed. All computations of
interest on Base Rate Loans shall be based on a 365-day year and paid for
the actual number of days elapsed. Except as otherwise provided in the
definition of the term "Interest Period" with respect to Eurodollar Rate
Loans, whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date
for such payment shall be extended to the next succeeding Business Day,
and interest shall accrue during such extension. The outstanding amount
of the Loans as reflected on the Records from time to time shall be
considered correct and binding on the Borrower unless within five (5)
Business Days after the Borrower's receipt of any notice from the Agent
or any of the Banks of such outstanding amount, the Borrower shall notify
the Agent or such Bank to the contrary.
4.5. Inability to Determine Eurodollar Rate. In the event that,
prior to the commencement of any Interest Period relating to any
Eurodollar Rate Loan, the Agent shall determine that adequate and
reasonable methods do not exist for ascertaining the Eurodollar Rate that
would otherwise determine the rate of interest to be applicable to any
Eurodollar Rate Loan during any Interest Period, the Agent shall
-32-
forthwith give notice of such determination (which shall be conclusive
and binding on the Borrower and the Banks) to the Borrower and the Banks.
In such event (i) any Loan Request or Conversion Request with respect to
Eurodollar Rate Loans shall be automatically withdrawn and, shall be
deemed a request for Base Rate Loans, (ii) each Eurodollar Rate Loan will
automatically, on the last day of the then current Interest Period
thereof, become a Base Rate Loan, and (iii) the obligations of the Banks
to make Eurodollar Rate Loans shall be suspended until the Agent
determines that the circumstances giving rise to such suspension no
longer exist, whereupon the Agent shall so notify the Borrower and the
Banks.
4.6 Illegality. Notwithstanding any other provisions herein, if
any present or future law, regulation, treaty or directive or in the
interpretation or application thereof shall make it unlawful for any Bank
to make or maintain Eurodollar Rate Loans, such Bank shall forthwith give
notice of such circumstances to the Borrower and the other Banks and
thereupon (i) the commitment of such Bank to make Eurodollar Rate Loans
or convert Loans of another Type to Eurodollar Rate Loans shall forthwith
be suspended and (ii) such Bank's Syndicated Loans then outstanding as
Eurodollar Rate Loans, if any, shall be converted automatically to Base
Rate Loans on the last day of each Interest Period applicable to such
Eurodollar Rate Loans or within such earlier period as may be required by
law. The Borrower hereby agrees promptly to pay the Agent for the
account of such Bank, upon demand by such Bank, any additional amounts
necessary to compensate such Bank for any costs incurred by such Bank in
making any conversion in accordance with this Section 4.6, including any
interest or fees payable by such Bank to lenders of funds obtained by it
in order to make or maintain its Eurodollar Rate Loans hereunder.
4.7 Additional Costs, etc. If any present or future applicable
law, which expression, as used herein, includes statutes, rules and
regulations thereunder and interpretations thereof by any competent court
or by any governmental or other regulatory body or official charged with
the administration or the interpretation thereof and requests,
directives, instructions and notices at any time or from time to time
hereafter made upon or otherwise issued to any Bank or the Agent by any
central bank or other fiscal, monetary or other authority (whether or not
having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this
Credit Agreement, the other Loan Documents, such Bank's Commitment or the
Loans (other than taxes based upon or measured by the income or profits
of such Bank or the Agent), or
-33-
(b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Bank of the principal of
or the interest on any Loans or any other amounts payable to any Bank or
the Agent under this Credit Agreement or the other Loan Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or commitments of an office of any Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, the Loans, such Bank's Commitment, or any class of loans or
commitments of which any of the Loans or such Bank's Commitment forms a
part, and the result of any of the foregoing is
(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Loans or such
Bank's Commitment, or
(ii) to reduce the amount of principal, interest or other
amount payable to such Bank or the Agent hereunder on account of such
Bank's Commitment or any of the Loans, or
(iii) to require such Bank or the Agent to make any payment or
to forego any interest or other sum payable hereunder, the amount of
which payment or foregone interest or other sum is calculated by
reference to the gross amount of any sum receivable or deemed received by
such Bank or the Agent from the Borrower hereunder,
then, and in each such case, the Borrower will, upon demand made by such
Bank or (as the case may be) the Agent at any time and from time to time
and as often as the occasion therefor may arise, pay to such Bank or the
Agent such additional amounts as will be sufficient to compensate such
Bank or the Agent for such additional cost, reduction, payment or
foregone interest or other sum.
4.8. Capital Adequacy. If after the date hereof any Bank or the
Agent determines that (i) the adoption of or change in any law,
governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law) regarding capital requirements for banks or
bank holding companies or any change in the interpretation or application
-34-
thereof by a court or governmental authority with appropriate
jurisdiction, or (ii) compliance by such Bank or the Agent or any
corporation controlling such Bank or the Agent with any law, governmental
rule, regulation, policy, guideline or directive (whether or not having
the force of law) of any such entity regarding capital adequacy, has the
effect of reducing the return on such Bank's or the Agent's commitment
with respect to any Loans to a level below that which such Bank or the
Agent could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's or the Agent's then existing
policies with respect to capital adequacy and assuming full utilization
of such entity's capital) by any amount deemed by such Bank or (as the
case may be) the Agent to be material, then such Bank or the Agent may
notify the Borrower of such fact. To the extent that the amount of such
reduction in the return on capital is not reflected in the Base Rate, the
Borrower agrees to pay such Bank or (as the case may be) the Agent the
amount of such reduction in the return on capital as and when such
reduction is determined upon presentation by such Bank or (as the case
may be) the Agent of a certificate in accordance with Section 4.9 hereof.
Each Bank shall allocate such cost increases among its customers in good
faith and on an equitable basis.
4.9. Certificate. A certificate setting forth any additional
amounts payable pursuant to Section 4.7 or 4.8 and a brief explanation of
such amounts which are due, submitted by any Bank or the Agent to the
Borrower, shall be conclusive, absent manifest error, that such amounts
are due and owing.
4.10. Indemnity. The Borrower agrees to indemnify each Bank and
to hold each Bank harmless from and against any loss, cost or expense
(including loss of anticipated profits) that such Bank may sustain or
incur as a consequence of (i) default by the Borrower in payment of the
principal amount of or any interest on any Eurodollar Rate Loans or
Competitive Bid Rate Loans as and when due and payable, including any
such loss or expense arising from interest or fees payable by such Bank
to lenders of funds obtained by it in order to maintain its Eurodollar
Rate Loans or Competitive Bid Rate Loans, (ii) default by the Borrower in
making a borrowing after the Borrower has given (or is deemed to have
given) a Loan Request or a Conversion Request relating thereto in
accordance with Section 2.2 or Section 2.8 or a Notice of Competitive Bid
Borrowing in accordance with Section 2.3.1(f) hereof, or (iii) the making
of any payment of a Eurodollar Rate Loan or Competitive Bid Rate Loan or
the making of any conversion of any such Eurodollar Rate Loan to a Base
Rate Loan on a day that is not the last day of the applicable Interest
Period with respect thereto, including interest or fees payable by such
Bank to lenders of funds obtained by it in order to maintain any such
Loans.
-35-
4.11. Interest After Default.
4.11.1 Overdue Amounts.
Overdue principal and (to the extent permitted by applicable law)
interest on the Loans and all other overdue amounts payable hereunder or
under any of the other Loan Documents shall bear interest compounded
monthly and payable on demand at a rate per annum equal to four percent
(4%) above the Base Rate until such amount shall be paid in full (after
as well as before judgment).
4.11.2 Amounts Not Overdue. During the continuance of a Default
or an Event of Default the principal of the Loans not overdue shall,
until such Default or Event of Default has been cured or remedied or such
Default or Event of Default has been waived by the Majority Banks
pursuant to Section 24, bear interest at a rate per annum equal to the
greater of (i) four percent (4%) above the rate of interest otherwise
applicable to such Loans or (ii) the rate of interest applicable to
overdue principal pursuant to Section 4.11.1.
4.12. Guaranties. The payment and performance of the Obligations
shall be guaranteed by each Subsidiary of the Borrower which becomes a
party to a Guaranty pursuant to Section 7.5.1 or Section 7.11.
5. REPRESENTATIONS AND WARRANTIES.
-----------------------------------
The Borrower represents and warrants to the Banks and the Agent as
follows:
5.1. Corporate Authority.
5.1.1. Incorporation; Good Standing. Each of the Borrower and
its Subsidiaries (i) is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation, (ii)
has all requisite corporate power to own its property and conduct its
business as now conducted and as presently contemplated, and (iii) is in
good standing as a foreign corporation and is duly authorized to do
business in each jurisdiction where such qualification is necessary
except where a failure to be so qualified would not have a materially
adverse effect on the business, assets or financial condition of the
Borrower or its Subsidiaries.
5.1.2. Authorization. The execution, delivery and performance of
this Credit Agreement and the other Loan Documents to which the Borrower
or any of its Subsidiaries is or is to become a party and the
transactions contemplated hereby and thereby (i) are within
-36-
the corporate authority of such Person, (ii) have been duly authorized by
all necessary corporate proceedings, (iii) do not conflict with or result
in any breach or contravention of any provision of law, statute, rule or
regulation to which the Borrower or any of its Subsidiaries is subject or
any judgment, order, writ, injunction, license or permit applicable to
the Borrower or any of its Subsidiaries and (iv) do not conflict with any
provision of the corporate charter or bylaws of, or any agreement or
other instrument binding upon, the Borrower or any of its Subsidiaries.
5.1.3. Enforceability. The execution and delivery of this Credit
Agreement and the other Loan Documents to which the Borrower or any of
its Subsidiaries is or is to become a party will result in valid and
legally binding obligations of such Person, enforceable against it in
accordance with the respective terms and provisions hereof and thereof,
except as enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors' rights and except to the extent
that availability of the remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
5.2. Governmental Approvals. The execution, delivery and
performance by the Borrower and any of its Subsidiaries of this Credit
Agreement and the other Loan Documents to which the Borrower or any of
its Subsidiaries is or is to become a party and the transactions
contemplated hereby and thereby do not require the approval or consent
of, or filing with, any governmental agency or authority other than those
already obtained.
5.3. Title to Properties; Leases. Except as indicated on
Schedule 5.3 hereto, the Borrower and its Subsidiaries own all of the
assets reflected in the consolidated balance sheet of the Borrower and
its Subsidiaries as at the Balance Sheet Date or acquired since that date
(except property and assets sold or otherwise disposed of in the ordinary
course of business since that date), subject to no rights of others,
including any mortgages, leases, conditional sales agreements, title
retention agreements, liens or other encumbrances except Permitted Liens.
5.4. Financial Statements. There has been furnished to the Agent
a consolidated balance sheet of the Borrower and its Subsidiaries as at
the Balance Sheet Date, and a consolidated statement of income and a
consolidated statement of cash flow for the fiscal year then ended,
including the opinion thereof expressed by and signed by the Borrower's
independent certified public accountants. Such balance sheet, statement
-37-
of income and statement of cash flow have been prepared in accordance
with generally accepted accounting principles and fairly present the
financial condition of the Borrower as at the close of business on the
date thereof and the results of operations for the fiscal year then
ended. There are no contingent liabilities of the Borrower or any of its
Subsidiaries as of such date involving material amounts, known to the
Borrower not disclosed in said balance sheet and the related notes
thereto.
5.5. No Material Changes, etc. Since the Balance Sheet Date there
has occurred no materially adverse change in the financial condition or
business of the Borrower and its Subsidiaries as shown on or reflected in
the consolidated balance sheet of the Borrower and its Subsidiaries as at
the Balance Sheet Date, or the consolidated statement of income for the
fiscal year then ended, other than changes in the ordinary course of
business that have not had any materially adverse effect on the business
or financial condition of the Borrower and its Subsidiaries on a
consolidated basis. Except as set forth on Schedule 5.5 hereto, the
Borrower has not, since the Balance Sheet Date, made any Distributions.
5.6. Franchises, Patents, Copyrights, etc. Each of the Borrower
and its Subsidiaries possesses all franchises, patents, copyrights,
trademarks, trade names, licenses and permits, and rights in respect of
the foregoing, adequate for the conduct of its business substantially as
now conducted without known conflict with any rights of others.
5.7. Litigation. There are no actions, suits, proceedings or
investigations of any kind pending or threatened against the Borrower or
any of its Subsidiaries before any court, tribunal or administrative
agency or board that, if adversely determined, might, in any case
materially adversely affect the properties, assets, financial condition
or business of the Borrower and its Subsidiaries on a consolidated basis
or materially impair the right of the Borrower and its Subsidiaries,
considered as a whole, to carry on business substantially as now
conducted by them, or result in any substantial liability not adequately
covered by insurance, or for which adequate reserves are not maintained
on the consolidated balance sheet of the Borrower, or which question the
validity of this Credit Agreement or any of the other Loan Documents, or
any action taken or to be taken pursuant hereto or thereto.
5.8. No Materially Adverse Contracts, etc. Neither the Borrower
nor any of its Subsidiaries is subject to any charter, corporate or other
legal restriction, or any judgment, decree, order, rule or regulation
that has or is expected in the future to have a materially adverse effect
on the business, assets or financial condition of the Borrower and of its
Subsidiaries on a consolidated basis. Neither the Borrower nor any of
its
-38-
Subsidiaries is a party to any contract or agreement that has or is
expected, in the judgment of the Borrower's officers, to have any
materially adverse effect on the business of the Borrower and its
Subsidiaries on a consolidated basis.
5.9. Compliance With Other Instruments, Laws, etc. Neither the
Borrower nor any of its Subsidiaries is in violation of any provision of
its charter documents, bylaws, or any agreement or instrument to which it
may be subject or by which it or any of its properties may be bound or
any decree, order, judgment, statute, license, rule or regulation, in any
of the foregoing cases in a manner that could result in the imposition of
substantial penalties or materially and adversely affect the financial
condition, properties or business of the Borrower and its Subsidiaries on
a consolidated basis.
5.10. Tax Status. The Borrower and its Subsidiaries (i) have
made or filed all federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which any of
them is subject, (ii) have paid all taxes and other governmental
assessments and charges shown or determined to be due on such returns,
reports and declarations, except those being contested in good faith and
by appropriate proceedings and (iii) have set aside on their books
provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be
due by the taxing authority of any jurisdiction, and the Borrower knows
of no basis for any such claim.
5.11. No Event of Default. No Default or Event of Default has
occurred and is continuing.
5.12. Holding Company and Investment Company Acts. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a
"subsidiary company" of a "holding company", or an affiliate" of a
"holding company", as such terms are defined in the Public Utility
Holding Company Act of 1935; nor is it an "investment company", or an
"affiliated company" or a "principal underwriter" of an "investment
company", as such terms are defined in the Investment Company Act of
1940.
5.13. Absence of Financing Statements, etc. Except with respect
to Permitted Liens, there is no financing statement, security agreement,
chattel mortgage, real estate mortgage or other document filed or
recorded with any filing records, registry, or other public office, that
purports to cover, affect or give notice of any present or possible
future
-39-
lien on, or security interest in, any assets or property of the Borrower
or any of its Subsidiaries or rights thereunder.
5.14. Chief Executive Office. The Borrower's chief executive
office is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
5.15. Certain Transactions. Except as set forth on Schedule
5.15, none of the officers, directors, or employees of the Borrower or
any of its Subsidiaries is presently a party to any transaction with the
Borrower or any of its Subsidiaries (other than for services as
employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by,
providing for rental of real or personal property to or from, or
otherwise requiring payments to or from any officer, director or such
employee or, to the knowledge of the Borrower, any corporation,
partnership, trust or other entity in which any officer, director, or any
such employee has a substantial interest or is an officer, director,
trustee or partner.
5.16. Employee Benefit Plans.
5.16.1 In General. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance in
all material respects with the applicable provisions of ERISA and, to the
extent applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions and the bonding of
fiduciaries and other persons handling plan funds as required by Section
412 of ERISA. The Borrower has heretofore delivered to the Agent the
most recently completed annual report, Form 5500, with all required
attachments, and actuarial statement required to be submitted under
Section 103(d) of ERISA, with respect to each Guaranteed Pension Plan.
5.16.2. Terminability of Welfare Plans. No Employee Benefit Plan
which is an employee welfare benefit plan within the meaning of Section
3(1) or Section 3(2)(B) of ERISA provides benefit coverage subsequent to
termination of employment except as required by Title I, Part 6 of ERISA
or applicable state insurance laws. The Borrower may terminate each such
Plan at any time (or at any time subsequent to the expiration of any
applicable bargaining agreement) in the discretion of the Borrower or
such ERISA Affiliate without liability to any Person other than for
claims arising prior to termination.
5.16.3. Guaranteed Pension Plans. Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be made to
avoid the incurrence of an accumulated funding deficiency,
-40-
the notice or lien provisions of Section 302(f) of ERISA, or otherwise,
has been timely made. No waiver of an accumulated funding deficiency or
extension of amortization periods has been received with respect to any
Guaranteed Pension Plan, and neither the Borrower nor any ERISA
Affiliate is obligated to or has posted security in connection with an
amendment of a Guaranteed Pension Plan pursuant to Section 307 of ERISA
or Section 401(a)(29) of the Code. No liability to the PBGC (other than
required insurance premiums, all of which have been paid) has been
incurred by the Borrower or any ERISA Affiliate with respect to any
Guaranteed Pension Plan and there has not been any ERISA Reportable
Event, or any other event or condition which presents a material risk of
termination of any Guaranteed Pension Plan by the PBGC; provided,
however, that prior to the Closing Date, the Borrower terminated its sole
Guaranteed Pension Plan as a standard termination pursuant to Section
4041(b) of ERISA and, as of the Closing Date, is in the process of
distributing all assets of such plan to the participants therein. Based
on the latest valuation of each Guaranteed Pension Plan (which in each
case occurred within twelve months of the date of this representation),
and on the actuarial methods and assumptions employed for that valuation,
the aggregate benefit liabilities of all such Guaranteed Pension Plans
within the meaning of Section 4001 of ERISA did not exceed the aggregate
value of the assets of all such Guaranteed Pension Plans, disregarding
for this purpose the benefit liabilities and assets of any Guaranteed
Pension Plan with assets in excess of benefit liabilities.
5.16.4. Multiemployer Plans. Neither the Borrower nor any ERISA
Affiliate is contributing or has ever contributed or been obligated to
contribute to any Multiemployer Plan.
5.17. Use of Proceeds.
5.17.1. General. The proceeds of the Loans shall be used
(a)(i) to finance acquisitions permitted by Section 7.5, (ii) to finance
repurchases of the Borrower's common stock and other Distributions to the
extent permitted by Section 7.4, and (iii) to refinance existing
Indebtedness of the Borrower to the Agent and certain of the Banks under
the Original Credit Agreement and (b) for working capital and general
corporate purposes.
5.17.2. Regulations U and X. No portion of any Loan is to
be used, except as otherwise permitted herein, for the purpose of
purchasing or carrying any "margin security" or "margin stock" as such
terms are used in Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and
-41-
224, nor is any portion of any Loan to be used in any manner which, after
giving effect to Section 7.5.1 and Permitted Acquisitions or to Section
7.11 or otherwise, would be in violation of such Regulations U or X.
5.17.3. Ineligible Securities. No portion of the proceeds
of any Loan is to be used for the purpose of (a) knowingly purchasing, or
providing credit support for the purchase of, Ineligible Securities from
a Section 20 Subsidiary during any period in which such Section 20
Subsidiary makes a market in such Ineligible Securities, (b) knowingly
purchasing, or providing credit support for the purchase of, during the
underwriting or placement period, any Ineligible Securities being
underwritten or privately placed by a Section 20 Subsidiary, or (c)
making, or providing credit support for the making of, payments of
principal or interest on Ineligible Securities underwritten or privately
placed by a Section 20 Subsidiary and issued by or for the benefit of the
Borrower, any of its Subsidiaries or any other Affiliate of the Borrower.
5.18. Environmental Compliance. The Borrower has taken all
necessary steps to investigate the past and present condition and usage
of the Real Estate and the operations conducted thereon and, based upon
such diligent investigation, has determined that:
(a) none of the Borrower, its Subsidiaries or any operator of the
Real Estate or any operations thereon is in violation, or alleged
violation, of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without
limitation, those arising under the Resource Conservation and Recovery
Act ("RCRA"), the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 as amended ("CERCLA"), the Superfund Amendments and
Reauthorization Act of 1986 ("▇▇▇▇"), the Federal Clean Water Act, the
Federal Clean Air Act, the Toxic Substances Control Act, or any state or
local statute, regulation, ordinance, order or decree relating to health,
safety or the environment (hereinafter "Environmental Laws"), which
violation would have a material adverse effect on the environment or the
business, assets or financial condition of the Borrower and its
Subsidiaries on a consolidated basis;
(b) except as set forth on Schedule 5.18 attached hereto: neither
the Borrower nor any of its Subsidiaries has received notice from any
third party including, without limitation, any federal, state or local
governmental authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency ("EPA") as a
potentially responsible party under CERCLA
-42-
with respect to a site listed on the National Priorities List, 40 C.F.R.
Part ▇▇▇ ▇▇▇▇▇▇▇▇ ▇; (ii) that any hazardous waste, as defined by 42
U.S.C. Section 6903(5), any hazardous substances as defined by 42 U.S.C.
Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) and any toxic substances, oil or hazardous materials or
other chemicals or substances regulated by any Environmental Laws
("Hazardous Substances") which any one of them has generated, transported
or disposed of has been found at any site at which a federal, state or
local agency or other third party has conducted or has ordered that the
Borrower or any of its Subsidiaries conduct a remedial investigation,
removal or other response action pursuant to any Environmental Law; or
(iii) that it is or shall be a named party to any claim, action, cause of
action, complaint, or legal or administrative proceeding (in each case,
contingent or otherwise) arising out of any third party's incurrence of
costs, expenses, losses or damages of any kind whatsoever in connection
with the release of Hazardous Substances;
(c) except as set forth on Schedule 5.18 attached hereto: (i) no
portion of the Real Estate has been used for the handling, processing,
storage or disposal of Hazardous Substances except in accordance with
applicable Environmental Laws; and no underground tank or other
underground storage receptacle for Hazardous Substances is located on any
portion of the Real Estate; (ii) in the course of any activities
conducted by the Borrower, its Subsidiaries or operators of its
properties, no Hazardous Substances have been generated or are being used
on the Real Estate except in accordance with applicable Environmental
Laws; (iii) there have been no releases (i.e. any past or present
releasing, spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, disposing or dumping) or threatened
releases of Hazardous Substances on, upon, into or from the properties of
the Borrower or its Subsidiaries, which releases would have a material
adverse effect on the value of any of the Real Estate or adjacent
properties or the environment; (iv) to the best of the Borrower's
knowledge, there have been no releases on, upon, from or into any real
property in the vicinity of any of the Real Estate which, through soil or
groundwater contamination, may have come to be located on, and which
would have a material adverse effect on the value of, the Real Estate;
and (v) in addition, any Hazardous Substances that have been generated on
any of the Real Estate have been transported offsite only by carriers
having an identification number issued by the EPA, treated or disposed of
only by treatment or disposal facilities maintaining valid permits as
required under applicable Environmental Laws, which transporters and
facilities
-43-
have been and are, to the best of the Borrower's knowledge, operating in
compliance with such permits and applicable Environmental Laws; and
(d) None of the Borrower and its Subsidiaries, or any of the other
Real Estate is subject to any applicable environmental law requiring the
performance of Hazardous Substances site assessments, or the removal or
remediation of Hazardous Substances, or the giving of notice to any
governmental agency or the recording or delivery to other Persons of an
environmental disclosure document or statement by virtue of the
transactions set forth herein and contemplated hereby, or as a condition
to the recording of any Mortgage or to the effectiveness of any other
transactions contemplated hereby.
5.19. Subsidiaries, etc. Schedule 5.19 hereto sets forth all
Subsidiaries of the Borrower. Except as set forth on Schedule 5.19
hereto, neither the Borrower nor any Subsidiary of the Borrower is
engaged in any joint venture or partnership with any other person.
Except for domestic Subsidiaries of the Borrower which are party to a
Guaranty, no domestic Subsidiary of the Borrower (a) is presently engaged
in business activities of any kind or nature (except that such Subsidiary
may have qualified to do business in a foreign jurisdiction), (b) has a
net worth or assets of more than a de minimis value or (c) has issued any
capital stock to any person other than the Borrower or a Subsidiary of
the Borrower.
5.20. Disclosure. No representation or warranty made by the
Borrower or any of its Subsidiaries in this Credit Agreement or any
agreement, instrument, document, certificate or other written statement
furnished to the Agent or any Bank by or on behalf of the Borrower or any
of its Subsidiaries in connection with any of the transactions
contemplated by any of the Loan Documents contains any untrue statement
of a material fact or omits to state a material fact necessary in order
to make the statements contained therein not misleading in light of the
circumstances in which they are made.
5.21. Fiscal Year. Each of the Borrower and its Subsidiaries has
a fiscal year which ends during June of each calendar year and fiscal
quarters which end during September, December and March of each calendar
year.
5.22. Solvency. The Borrower, on a consolidated basis with its
Subsidiaries (both before and after giving effect to the transactions
contemplated by the Credit Agreement and the other Loan Documents), (i)
is solvent, (ii) has assets having a fair value in excess of its
liabilities, (iii)
-44-
has assets having a fair value in excess of the amount required to pay
its liabilities on its debts as they become due and matured, and (iv)
has, and expects to continue to have, access to adequate capital for the
conduct of its business and the ability to pay its debts as they mature.
5.23. Rapidforms Acquisition. Upon the closing (if any) of the
Rapidforms Acquisition, each of the representations and warranties made
by the Borrower and, to the best of the Borrower's knowledge, CSS
Industries, Inc. contained in the Rapidforms Stock Purchase Agreement
shall have been true and correct in all material respects when made and
shall continue to be true and correct in all material respects on the
date of such closing, except to the extent that any of such
representations and warranties relate, by the express terms thereof,
solely to a date falling prior to the date of such closing, and except to
the extent that any of such representations and warranties may have been
affected by the consummation of the transactions contemplated and
permitted or required by the Rapidforms Stock Purchase Agreement.
6. AFFIRMATIVE COVENANTS OF THE BORROWER.
-----------------------------------------
The Borrower covenants and agrees that, so long as any Loan or Note
is outstanding or any Bank has any obligation to make any Loans:
6.1. Punctual Payment. The Borrower will duly and punctually pay
or cause to be paid the principal and interest on the Loans and the
closing fees, facility fees and Agent's fee provided for in this Credit
Agreement, all in accordance with the terms of this Credit Agreement and
the Notes.
6.2. Maintenance of Office. The Borrower will maintain its chief
executive office in Groton, Massachusetts, or at such other place in the
United States of America as the Borrower shall designate upon written
notice to the Agent, where notices, presentations and demands to or upon
the Borrower in respect of the Loan Documents may be given or made.
6.3. Records and Accounts. The Borrower will (a) keep, and cause
each of its Subsidiaries to keep, true and accurate records and books of
account in which full, true and correct entries will be made in
accordance with generally accepted accounting principles; (b) maintain
adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties
and the properties of its Subsidiaries, contingencies, and other
reserves; and (c) will at all times have engaged Deloitte & Touche, LLP
or other independent certified public accountants satisfactory to the
Agent as its accountants, with no more than thirty (30) days elapsing
between the
-45-
termination of any such accountants as the Borrower's accountants and the
engagement of successor accountants satisfactory to the Agent.
6.4 Financial Statements, Certificates and Information. The
Borrower will deliver to each of the Banks:
(a) as soon as practicable, but in any event not later than ninety
(90) days after the end of each fiscal year of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries and the
consolidating balance sheet of the Borrower and its Subsidiaries, each as
at the end of such year, and the related consolidated statement of income
and consolidated statement of cash flow and consolidating statement of
income and consolidating statement of cash flow for such year, each
setting forth in comparative form the figures for the previous fiscal
year and all such consolidated and consolidating statements to be in
reasonable detail, prepared in accordance with generally accepted
accounting principles, and certified without qualification by Deloitte &
Touche LLP or by other independent certified public accountants
satisfactory to the Agent together with a written statement from such
accountants to the effect that they have read a copy of this Credit
Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event of
Default, or, if such accountants shall have obtained knowledge of any
then existing Default or Event of Default they shall disclose in such
statement any such Default or Event of Default; provided that such
accountants shall not be liable to the Banks for failure to obtain
knowledge of any Default or Event of Default;
(b) as soon as practicable, but in any event not later than forty-
five (45) days after the end of each of the fiscal quarters of the
Borrower, copies of the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries and the unaudited consolidating balance
sheet of the Borrower and its Subsidiaries, each as at the end of such
quarter, and the related consolidated statement of income and
consolidated statement of cash flow and consolidating statement of income
and consolidating statement of cash flow for the portion of the
Borrower's fiscal year then elapsed, all in reasonable detail and
prepared in accordance with generally accepted accounting principles,
together with a certification by the principal financial or accounting
officer of the Borrower that the information contained in such financial
statements fairly presents the financial position of the Borrower and its
Subsidiaries on the date thereof (subject to year-end adjustments);
-46-
(c) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrower in
substantially the form of Exhibit G hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in Section 8 and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance
Sheet Date;
(d) contemporaneously with the filing or mailing thereof, copies of
all material of a financial nature filed with the Securities and Exchange
Commission or sent to the stockholders of the Borrower; and
(e) from time to time such other financial data and information
(including accountants' management letters) as the Agent or any Bank may
reasonably request.
6.5. Notices.
6.5.1. Defaults. The Borrower will promptly notify the Agent and
each of the Banks in writing of the occurrence of any Default or Event of
Default. If any Person shall give any notice or take any other action in
respect of a claimed default (whether or not constituting an Event of
Default) under this Credit Agreement or any other note, evidence of
indebtedness, indenture or other obligation to which or with respect to
which the Borrower or any of its Subsidiaries is a party or obligor,
whether as principal or surety, the Borrower shall forthwith give written
notice thereof to each of the Banks, describing the notice or action and
the nature of the claimed default.
6.5.2. Environmental Events. The Borrower will promptly give
notice to the Agent (i) of any violation of any Environmental Law that
the Borrower or any of its Subsidiaries reports in writing or is
reportable by such Person in writing (or for which any written report
supplemental to any oral report is made) to any federal, state or local
environmental agency and (ii) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice
from any agency of potential environmental liability, of any federal,
state or local environmental agency or board, that has the potential to
materially affect the assets, liabilities, financial conditions or
operations of the Borrower and its Subsidiaries on a consolidated basis.
-47-
6.5.3. Notice of Litigation and Judgments. The Borrower will, and
will cause each of its Subsidiaries to, give notice to the Agent in
writing within fifteen (15) days of becoming aware of any litigation or
proceedings threatened in writing or any pending litigation and
proceedings affecting the Borrower or any of its Subsidiaries or to which
the Borrower or any of its Subsidiaries is or becomes a party involving
an uninsured claim against the Borrower or any of its Subsidiaries that
could reasonably be expected to have a materially adverse effect on the
Borrower and its Subsidiaries on a consolidated basis and stating the
nature and status of such litigation or proceedings. The Borrower will,
and will cause each of its Subsidiaries to, give notice to the Agent, in
writing, in form and detail satisfactory to the Agent, within ten (10)
days of any judgment not covered by insurance, final or otherwise,
against the Borrower or any of its Subsidiaries in an amount in excess of
$1,000,000.
6.6. Corporate Existence; Maintenance of Properties. The Borrower
will do or cause to be done all things necessary to preserve and keep in
full force and effect its corporate existence, rights and franchises and
those of its Subsidiaries and will not, and will not cause or permit any
of its Subsidiaries to, convert to a limited liability company or limited
liability partnership. The Borrower (i) will cause all of its properties
and those of its Subsidiaries used or useful in the conduct of its
business or the business of its Subsidiaries to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment, (ii) will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the
judgment of the Borrower may be necessary so that the business carried on
in connection therewith may be properly and advantageously conducted at
all times, and (iii) will, and will cause each of its Subsidiaries to,
continue to engage primarily in the businesses now conducted by them and
in related businesses; provided that nothing in this Section 6.6 shall
prevent the Borrower from discontinuing the operation and maintenance of
any of its properties or those of its Subsidiaries or terminating the
corporate existence of any Subsidiary if such discontinuance or
termination is, in the judgment of the Borrower, desirable in the conduct
of its or their business and that do not in the aggregate materially
adversely affect the business of the Borrower and its Subsidiaries on a
consolidated basis.
6.7. Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such
casualties and contingencies as shall be in accordance with the general
practices of businesses engaged in similar activities in similar
geographic
-48-
areas and in amounts, containing such terms, in such forms and for such
periods as may be reasonable and prudent.
6.8. Taxes. The Borrower will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all taxes, assessments
and other governmental charges (other than taxes, assessments and other
governmental charges imposed by foreign jurisdictions that in the
aggregate are not material to the business or assets of the Borrower on
an individual basis or of the Borrower and its Subsidiaries on a
consolidated basis) imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom,
as well as all claims for labor, materials, or supplies that if unpaid
might by law become a lien or charge upon any of its property; provided
that any such tax, assessment, charge, levy or claim need not be paid if
the validity or amount thereof shall currently be contested in good faith
by appropriate proceedings and if the Borrower or such Subsidiary shall
have set aside on its books adequate reserves with respect thereto; and
provided further that the Borrower and each Subsidiary of the Borrower
will pay all such taxes, assessments, charges, levies or claims forthwith
upon the commencement of proceedings to foreclose any lien that may have
attached as security therefor.
6.9. Inspection of Properties and Books, etc.
6.9.1. General. The Borrower shall permit the Banks, through the
Agent or any of the Banks' other designated representatives, to visit and
inspect any of the properties of the Borrower or any of its Subsidiaries
to examine the books of account of the Borrower and its Subsidiaries (and
to make copies thereof and extracts therefrom), to conduct periodic
commercial finance examinations, and to discuss the affairs, finances and
accounts of the Borrower and its Subsidiaries with, and to be advised as
to the same by, its and their officers, all at such reasonable times and
intervals as the Agent or any Bank may reasonably request.
6.9.2. Communication with Accountants. The Borrower authorizes
the Agent and, if accompanied by the Agent, the Banks to communicate
directly with the Borrower's independent certified public accountants
following advance notice to the Borrower offering the Borrower the
opportunity to be part of any oral communication with such accountants
and authorizes such accountants to disclose to the Agent and the Banks
any and all financial statements and other supporting financial documents
and schedules including copies of any management letter with respect to
the business,
-49-
financial condition and other affairs of the Borrower or any of its
Subsidiaries. At the request of the Agent, the Borrower shall deliver a
letter addressed to such accountants instructing them to comply with the
provisions of this Section 6.9.2.
6.10. Compliance with Laws, Contracts, Licenses, and Permits.
The Borrower will, and will cause each of its Subsidiaries to, comply
with (i) the applicable laws and regulations wherever its business is
conducted, including all Environmental Laws, (ii) the provisions of its
charter documents and by-laws, (iii) all agreements and instruments by
which it or any of its properties may be bound and (iv) all applicable
decrees, orders, and judgments. If at any time while any Loan or Note is
outstanding or any Bank has any obligation to make Loans hereunder, any
authorization, consent, approval, permit or license from any officer,
agency or instrumentality of any government shall become necessary or
required in order that the Borrower may fulfill any of its obligations
hereunder, the Borrower will immediately take or cause to be taken all
reasonable steps within the power of the Borrower to obtain such
authorization, consent, approval, permit or license and furnish the Banks
with evidence thereof.
6.11. Employee Benefit Plans. The Borrower will (i) promptly,
upon request of the Agent, furnish to the Agent a copy of the most recent
actuarial statement required to be submitted under Section 103(d) of
ERISA and Annual Report, Form 5500, with all required attachments, in
respect of each Guaranteed Pension Plan and (ii) promptly upon receipt or
dispatch, furnish to the Agent any notice, report or demand sent or
received in respect of a Guaranteed Pension Plan under Section Section
302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or in respect
of a Multiemployer Plan, under Section Section 4041A, 4202, 4219, 4242,
or 4245 of ERISA.
6.12. Use of Proceeds. The Borrower will use the proceeds of the
Loans solely (a) (i) to finance acquisitions permitted by Section 7.5,
(ii) to finance repurchases of the Borrower's common stock or other
Distributions to the extent permitted by Section 7.4, and (iii) to
refinance existing Indebtedness of the Borrower to the Agent and certain
of the Banks under the Original Credit Agreement, and (b) for working
capital and general corporate purposes, and not in violation of
Regulations U or X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.
6.13. Rapidforms Acquisition.
6.13.1. Guaranty, etc. Promptly but in any event within
twenty-one (21) days following the consummation of the Rapidforms
Acquisition, each of Rapidforms and its material Subsidiaries shall
-50-
execute and deliver to the Agent a Guaranty, in the form of Exhibit A
hereto, of the Obligations under this Credit Agreement and the other Loan
Documents, together with such evidence of corporate authorization, other
corporate documentation and legal opinions (including, where applicable,
local counsel opinions) as the Agent may reasonably request.
6.13.2. Amendment of Certificate of Incorporation. Promptly
following the consummation of the Rapidforms Acquisition, the Borrower
shall cause the filing of an amendment to the Certificate of
Incorporation of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Inc. with the Secretary of State for
the State of Delaware deleting the Eighth Article thereof in its
entirety.
6.13.3. Closing Balance Sheet. The Borrower shall deliver
to the Agent and the Banks, promptly upon receipt thereof from CSS
Industries, Inc., the audited Closing Balance Sheet (as defined in the
Rapidforms Stock Purchase Agreement).
6.13.4. Obligations Under Trust Indenture. On or before
March 15, 1998, the Borrower shall (a) repay the indebtedness of
Rapidforms and its affiliates in respect of the Trust Indenture, and the
bonds issued pursuant thereto and (b) cause the release of any and all
mortgages, liens, security interests or other encumbrances securing any
obligations with respect thereto.
6.14. Further Assurances. The Borrower will, and will cause each
of its Subsidiaries to, cooperate with the Banks and the Agent and
execute such further instruments and documents as the Banks or the Agent
shall reasonably request to carry out to their satisfaction the
transactions contemplated by this Credit Agreement and the other Loan
Documents.
7. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
-----------------------------------------------
The Borrower covenants and agrees that, so long as any Loan or Note is
outstanding or any Bank has any obligation to make any Loans:
7.1. Restrictions on Indebtedness. The Borrower will not, and
will not permit any of its Subsidiaries to, create, incur, assume,
guarantee or be or remain liable, contingently or otherwise, with respect
to any Indebtedness other than:
(a) Indebtedness to the Banks and the Agent arising under any of
the Loan Documents;
-51-
(b) current liabilities of the Borrower incurred in the ordinary
course of business not incurred through (i) the borrowing of money, or
(ii) the obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal
purchases of goods and services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be made
in accordance with the provisions of Section 6.8;
(d) Indebtedness in respect of judgments or awards that have been
in force for less than the applicable period for taking an appeal so long
as execution is not levied thereunder or in respect of which the Borrower
shall at the time in good faith be prosecuting an appeal or proceedings
for review and in respect of which a stay of execution shall have been
obtained pending such appeal or review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary
course of business;
(f) obligations under Capitalized Leases not exceeding $5,000,000
in aggregate amount at any time outstanding;
(g) Indebtedness incurred in connection with the acquisition after
the date hereof of any real or personal property by the Borrower or any
Subsidiary of the Borrower, provided that the aggregate principal amount
of such Indebtedness of the Borrower and its Subsidiaries shall not
exceed the aggregate amount of $5,000,000 at any one time;
(h) Indebtedness existing on the date of this Credit Agreement and
listed and described on Schedule 7.1 hereto;
(i) Indebtedness of any and all Subsidiaries of the Borrower to the
Borrower (i) existing on the Closing Date, and (ii) after the Closing
Date, in an aggregate amount not to exceed $7,500,000;
(j) Indebtedness of the Borrower to any and all Subsidiaries of the
Borrower, which Indebtedness is subordinated to the Obligations on terms
and conditions satisfactory to the Agent, in an aggregate amount not to
exceed $10,000,000;
(k) Indebtedness in respect of (i) overseas lines of credit of the
Borrower or any of its Subsidiaries, (ii) letters of credit, (iii) the
-52-
granting of surety, appeal, bid, performance or other similar bonds or
(iv) guaranties or other contingent obligations in respect of
Indebtedness of any Person, all of which Indebtedness described in
clauses (i) - (iv) of this subparagraph (k), in the aggregate, shall not
exceed $10,000,000;
(l) Indebtedness with respect to interest rate protection agreements
between the Borrower and any of the Banks;
(m) Indebtedness for borrowed money, debt or similar monetary
obligations assumed in respect of Permitted Acquisitions (other than the
Rapidforms Acquisition), to the extent permitted by paragraph 2(b) of the
definition thereof, and other Indebtedness assumed in respect of
Permitted Acquisitions (other than the Rapidforms Acquisition) and
existing prior to the date of any Permitted Acquisition and not created
in contemplation thereof;
(n) In the event that the Rapidforms Acquisition is consummated in
accordance with the terms and conditions for such acquisition set forth
in the definition of Rapidforms Acquisition and otherwise within this
Credit Agreement, (i) until March 15, 1998, Indebtedness of Rapidforms
under or in respect of the Trust Indenture in an aggregate amount not to
exceed $1,250,000, and (ii) additional Indebtedness of Rapidforms and its
Subsidiaries (other than Indebtedness for borrowed money, debt or other
similar obligations) assumed in respect of the Rapidforms Acquisition and
existing prior to the date of the execution of the Rapidforms Stock
Purchase Agreement and not created in contemplation of the Rapidforms
Acquisition;
(o) Indebtedness not expressly permitted under Subsections (a)
through (n) of this Section 7.1 in an aggregate amount not to exceed
$5,000,000 at any time.
7.2. Restrictions on Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, (i) create or incur or suffer to be
created or incurred or to exist any lien, encumbrance, mortgage, pledge,
charge, restriction or other security interest of any kind upon any of
its property or assets of any character whether now owned or hereafter
acquired, or upon the income or profits therefrom; (ii) transfer any of
such property or assets or the income or profits therefrom for the
purpose of subjecting the same to the payment of Indebtedness or
performance of any other obligation in priority to payment of its general
creditors; (iii) acquire, or agree or have an option to acquire, any
property or assets upon conditional sale or other title retention or
purchase money security agreement, device
-53-
or arrangement; (iv) suffer to exist for a period of more than thirty
(30) days after the same shall have been incurred any Indebtedness or
claim or demand against it that if unpaid might by law or upon bankruptcy
or insolvency, or otherwise, be given any priority whatsoever over its
general creditors; or (v) sell, assign, pledge or otherwise transfer any
accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; provided that the Borrower and any
Subsidiary of the Borrower may create or incur or suffer to be created or
incurred or to exist:
(a) liens to secure taxes, assessments and other government charges
in respect of obligations not overdue or liens on properties to secure
claims for labor, material or supplies in respect of obligations not
overdue;
(b) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(c) liens on properties in respect of judgments or awards, the
Indebtedness with respect to which is permitted by Section 7.1(d);
(d) liens of carriers, warehousemen, mechanics and materialmen, and
other like liens on properties, in existence less than one hundred twenty
(120) days from the date of creation thereof in respect of obligations
not overdue;
(e) encumbrances consisting of easements, rights of way, zoning
restrictions, restrictions on the use of real property and defects and
irregularities in the title thereto, landlord's or lessor's liens under
leases to which the Borrower or a Subsidiary of the Borrower is a party,
and other minor liens or encumbrances none of which in the opinion of the
Borrower interferes materially with the use of the property affected in
the ordinary conduct of the business of the Borrower and its
Subsidiaries, which defects do not individually or in the aggregate have
a materially adverse effect on the business of the Borrower individually
or of the Borrower and its Subsidiaries on a consolidated basis;
(f) presently outstanding liens listed on Schedule 7.2 hereto;
(g) purchase money security interests in or purchase money
mortgages on real or personal property acquired after the date hereof to
secure purchase money Indebtedness of the type and amount permitted by
Section 7.1(g), incurred in connection with the
-54-
acquisition of such property, which security interests or mortgages cover
only the real or personal property so acquired;
(h) rights of lessors under Capitalized Leases permitted by Section
7.1(f);
(i) liens on assets acquired pursuant to Permitted Acquisitions
(other than the Rapidforms Acquisition) and securing Indebtedness
otherwise permitted by Section 7.1(m) and the definition of Permitted
Acquisitions;
(j) liens on any capital stock of the Borrower or other Margin
Stock for so long as such stock constitutes Margin Stock; and
(k) in the event that the Rapidforms Acquisition is consummated in
accordance with the terms and conditions set forth in the definition of
Rapidforms Acquisition and otherwise in this Credit Agreement, (i) until
March 15, 1998, liens on Real Estate located in Bridgeton, New Jersey, on
equipment, on deposit accounts held at Fleet Bank, N.A. and on books and
records relating to such Real Estate, all of which secure obligations of
Rapidforms or its Subsidiaries under and in respect of the Trust
Indenture; and (ii) liens on assets of Rapidforms and its Subsidiaries
securing Indebtedness otherwise permitted by Section 7.1(n).
7.3. Restrictions on Investments. The Borrower will not, and will
not permit any of its Subsidiaries to, make or permit to exist or to
remain outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of
purchase by the Borrower;
(b) demand deposits, certificates of deposit, bankers acceptances
and time deposits of United States banks having total assets in excess of
$1,000,000,000, and demand deposits or certificates of deposit of foreign
banks having total assets in excess of the equivalent of $25,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated
and the ratings for which are not less than "P 1" if rated by ▇▇▇▇▇'▇
Investors Services, Inc., and not less than "A 1" if rated by Standard
and Poor's;
-55-
(d) Investments existing on the date hereof and listed on Schedule
7.3 hereto;
(e) Investments with respect to Indebtedness permitted by Section
7.1(i) and Section 7.1(j) so long as such entities remain Subsidiaries of
the Borrower;
(f) Investments consisting of any Guaranty;
(g) Investments consisting of promissory notes received as proceeds
of asset dispositions permitted by Section 7.5.2;
(h) Investments consisting of loans and advances to employees for
moving, entertainment, travel, hardship and other similar expenses in the
ordinary course of business not to exceed $1,000,000 in the aggregate at
any time outstanding; and
(i) tax exempt municipal bonds or bond funds rated AA or higher by
Standard and Poor's Ratings Group or ▇▇▇▇▇'▇ Investors Services, Inc.;
(j) Investments (i) existing as of the Closing Date, in
Subsidiaries of the Borrower and (ii) made following the Closing Date in
Subsidiaries of the Borrower in an aggregate amount for all such
Subsidiaries not to exceed $7,500,000;
(k) Investments in respect of (i) Permitted Acquisitions (other
than the Rapidforms Acquisition) to the extent permitted by the
definition thereof and (ii) the Rapidforms Acquisition to the extent
permitted by the definition thereof and Section 7.1(n);
(l) Investments by a foreign Subsidiary in marketable direct or
guaranteed obligations of the national government of its country of
incorporation that mature within one (1) year following the date of
purchase by such Subsidiary;
(m) Investments by the Borrower in its capital stock held as
treasury stock (existing as of the Closing Date or to the extent
repurchased in accordance with the requirements of Section 7.4) or in any
employee benefit plan of the Borrower; and
(n) Investments not otherwise expressly permitted under Subsections
(a) - (m) of this Section 7.3, in an aggregate amount not to exceed
$5,000,000 at any one time.
-56-
7.4. Distributions. The Borrower will not make any
Distributions; provided, however, that so long as no Default or Event of
Default has occurred and is continuing or would occur after giving effect
thereto, and subject in particular to the Borrower's continuing
compliance with its covenants set forth in Section Section 8.1-8.3
hereof, the Borrower (a) may pay dividends on its common stock in an
aggregate amount not to exceed $20,000,000 in any fiscal year of the
Borrower and (b) may make repurchases of its own issued and outstanding
common stock pursuant to any stock repurchase plan approved by its Board
of Directors in an aggregate amount not to exceed, $50,000,000.
7.5. Merger, Consolidation.
7.5.1. Mergers and Acquisitions. The Borrower will not, and
will not permit any of its Subsidiaries to, become a party to any merger
or consolidation, or agree to or effect any asset acquisition or stock
acquisition (other than the acquisition of assets in the ordinary course
of business consistent with past practices) except (a) the merger or
consolidation of one or more of the Subsidiaries of the Borrower with and
into the Borrower, (b) the merger or consolidation of two or more
Subsidiaries of the Borrower, or (c) Permitted Acquisitions.
7.5.2. Disposition of Assets. The Borrower will not, and
will not permit any of its Subsidiaries to, become a party to or agree to
or effect any disposition of assets, other than (a) the sale of
inventory, (b) the license or lease of intellectual property in the
ordinary course of business, and (c) the disposition of assets, in each
case set forth in clauses (a), (b) and (c) hereof in the ordinary course
of business and consistent with past practices, (d) dispositions of
capital stock of the Borrower and other Margin Stock for so long as such
stock constitutes Margin Stock, and (e) other dispositions of assets in
an aggregate amount not to exceed the lesser of (i) $5,000,000 and (ii)
five percent (5%) of Consolidated Total Assets (determined as of the date
or dates of such dispositions).
7.6. Sale and Leaseback. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any arrangement, directly
or indirectly, whereby the Borrower or any Subsidiary of the Borrower
shall sell or transfer any property owned by it in order then or
thereafter to lease such property or lease other property that the
Borrower or any Subsidiary of the Borrower intends to use for
substantially the same purpose as the property being sold or transferred.
-57-
7.7. Compliance with Environmental Laws. Except as set forth in
Schedule 5.18 hereto, the Borrower will not, and will not permit any of
its Subsidiaries to, (i) use any of the Real Estate or any portion
thereof for the handling, processing, storage or disposal of Hazardous
Substances, (ii) cause or permit to be located on any of the Real Estate
any underground tank or other underground storage receptacle for
Hazardous Substances, (iii) generate any Hazardous Substances on any of
the Real Estate, (iv) conduct any activity at any Real Estate or use any
Real Estate in any manner so as to cause a release (i.e. releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, disposing or dumping) or threatened
release of Hazardous Substances on, upon or into the Real Estate or (v)
otherwise conduct any activity at any Real Estate or use any Real Estate
in any manner that would violate any Environmental Law or bring such Real
Estate in violation of any Environmental Law.
7.8. Employee Benefit Plans. Neither the Borrower nor any ERISA
Affiliate will:
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code which could result in a
material liability for the Borrower or any of its Subsidiaries; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 302 of ERISA,
whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could
result in the imposition of a lien or encumbrance on the assets of the
Borrower or any of its Subsidiaries pursuant to Section 302(f) or
Section 4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring
the posting of security pursuant to Section 307 of ERISA or Section
401(a)(29) of the Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of Section 4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities.
-58-
7.9. Fiscal Year. Neither the Borrower nor any of its
Subsidiaries will change the date of the end of its fiscal year or any
fiscal quarter from that set forth in Section 5.22 hereof.
7.10. Prohibition on Negative Pledges. Neither the Borrower nor
any of its Subsidiaries will enter into, or be or become bound by or
subject to, any agreement prohibiting the creation or assumption of any
lien or security interest upon its properties, whether now owned or
hereafter acquired.
7.11. Creation and Maintenance of Subsidiaries. Neither the
Borrower nor any of its Subsidiaries shall create any Subsidiary (other
than any Subsidiaries existing on the Closing Date and disclosed in
Section 5.19 hereto) unless (a) one hundred percent (100%) of the capital
stock or other equity interests (subject to the exclusion of any legally
required directors' qualifying shares) of such Subsidiary are owned
directly or indirectly by the Borrower, (b) prior to the formation of
such Subsidiary, the Borrower shall notify the Agent and the Banks
thereof, and (c) contemporaneously with the formation of such Subsidiary,
the Borrower shall (i) cause such Subsidiary to guaranty all of the
Obligations hereunder pursuant to a Guaranty, which Guaranty shall be a
Loan Document hereunder, and (ii) cause such Subsidiary to deliver to the
Banks and the Agent satisfactory evidence of proper corporate
authorization and legal opinions with respect to such Guaranty. In the
event that any domestic Subsidiary existing on the Closing Date and
disclosed on Schedule 5.19 shall hereafter become engaged in business of
any kind or nature (except that such Subsidiary is qualified to do
business in a foreign jurisdiction), shall have a net worth or assets of
more than a de minimis value or shall have issued any capital stock to
any person other than the Borrower or a Subsidiary of the Borrower, then
the Borrower shall immediately notify the Agent and the Banks thereof and
shall immediately cause such Subsidiary to comply with the requirement of
such subsection (c) hereof.
7.12. Conduct of Business. Neither the Borrower nor any of its
Subsidiaries will, without the prior written consent of the Agent and the
Majority Banks, conduct any business or operations materially different
from those conducted by it on the Closing Date or on the date any such
Subsidiary is acquired in compliance with the terms of Section 7.5.1.
8. FINANCIAL COVENANTS OF THE BORROWER.
----------------------------------------
8.1. Funded Debt to EBITDA. The Borrower will not as of the end
of any four (4) consecutive fiscal quarters of the Borrower ending on any
quarter end, permit the ratio of (a) Consolidated Funded Debt as at
-59-
such quarter end to (b) EBITDA for such four (4) consecutive fiscal
quarters then ended to be greater than 2.5:1.0.
8.2. Minimum Fixed Charge Coverage Ratio. The Borrower will not,
as at the end of any four (4) consecutive fiscal quarters of the Borrower
ending on any quarter end, permit the ratio of (a) EBITDA for such period
minus Capital Expenditures for such period to (b) Consolidated Total
Interest Expense for such period plus any scheduled amortization payments
on Indebtedness permitted by Section 7.1, to be less than 4.0:1.0.
8.3. Consolidated Net Worth. The Borrower will not permit
Consolidated Net Worth at any time to be less than the sum of (i)
$70,000,000 plus (ii) on a cumulative basis, fifty percent (50%) of
positive Consolidated Net Income for each fiscal quarter beginning with
the fiscal quarter ended March 28, 1998.
9. CLOSING CONDITIONS.
-----------------------
The obligations of the Banks to make the initial Loans shall be
subject to the satisfaction of the following conditions precedent on or
prior to December 18, 1997:
9.1. Loan Documents. Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto, shall be
in full force and effect and shall be in form and substance satisfactory
to each of the Banks. Each Bank shall have received a fully executed
copy of each such document.
9.2. Certified Copies of Charter Documents. Each of the Banks
shall have received from the Borrower a copy, certified by a duly
authorized officer of such Person to be true and complete on the Closing
Date, of each of (i) its charter or other incorporation documents as in
effect on such date of certification, and (ii) its by-laws as in effect
on such date.
9.3. Corporate Action. All corporate action necessary for the
valid execution, delivery and performance by the Borrower and each of its
Subsidiaries of this Credit Agreement and the other Loan Documents to
which it is or is to become a party shall have been duly and effectively
taken, and evidence thereof satisfactory to the Banks shall have been
provided to each of the Banks.
9.4. Incumbency Certificate. Each of the Banks shall have
received from the Borrower an incumbency certificate, dated as of the
Closing Date, signed by a duly authorized officer of the Borrower, and
giving the name and bearing a specimen signature of each individual who
-60-
shall be authorized: (i) to sign, in the name and on behalf of the
Borrower, each of the Loan Documents; (ii) to make Loan Requests,
Conversion Requests, Competitive Bid Quote Requests and Notices of
Competitive Bid Borrowing; and (iii) to give notices and to take other
action on its behalf under the Loan Documents.
9.5. UCC Search Results. The Agent shall have received from the
Borrower the results of UCC searches in jurisdictions certified by the
Borrower as constituting the location of all offices and locations,
including the chief executive office, of the Borrower and in such other
jurisdictions as the Agent may request, indicating no liens other than
Permitted Liens and otherwise in form and substance satisfactory to the
Agent.
9.6. Certificates of Insurance. The Agent shall have received a
certificate of insurance from an independent insurance broker dated as of
the Closing Date, identifying insurers, types of insurance, insurance
limits, and policy terms, and otherwise describing the insurance obtained
in accordance with the provisions hereof.
9.7. Solvency Certificate. Each of the Banks shall have received
an officer's certificate of the Borrower dated as of the Closing Date as
to the solvency of the Borrower and its Subsidiaries following the
consummation of the transactions contemplated herein and in form and
substance satisfactory to the Banks.
9.8. Opinion of Counsel. Each of the Banks and the Agent shall
have received a favorable opinion addressed to the Banks and the Agent,
dated as of the Closing Date, in form and substance satisfactory to the
Banks and the Agent, from Hill & ▇▇▇▇▇▇, counsel to the Borrower and its
Subsidiaries.
9.9. Payment of Fees. As required by Section 4.1, the Borrower
shall have paid to the Agent, the Arranger and the Documentation Agent
the fees described in the Fee Letters.
10. CONDITIONS TO ALL BORROWINGS.
---------------------------------
The obligations of the Banks to make any Loan, whether on or after
the Closing Date, shall also be subject to the satisfaction of the
following conditions precedent:
10.1. Representations True; No Event of Default. Each of the
representations and warranties of any of the Borrower and its
Subsidiaries contained in this Credit Agreement, the other Loan Documents
or in any document or instrument delivered pursuant to or in connection
with this Credit Agreement shall be true as of the date as of
-61-
which they were made and shall also be true at and as of the time of the
making of such Loan, with the same effect as if made at and as of that
time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan
Documents and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and to the extent
that such representations and warranties relate expressly to an earlier
date) and no Default or Event of Default shall have occurred and be
continuing.
10.2. No Legal Impediment. No change shall have occurred in any
law or regulations thereunder or interpretations thereof that in the
reasonable opinion of any Bank would make it illegal for such Bank to
make such Loan.
10.3. Governmental Regulation. Each Bank shall have received
such statements in substance and form reasonably satisfactory to such
Bank as such Bank shall require for the purpose of compliance with any
applicable regulations of the Comptroller of the Currency or the Board of
Governors of the Federal Reserve System.
10.4 Proceedings and Documents. All proceedings in connection
with the transactions contemplated by this Credit Agreement, the other
Loan Documents and all other documents incident thereto shall be
satisfactory in substance and in form to the Banks and to the Agent and
the Agent's Special Counsel, and the Banks, the Agent and such counsel
shall have received all information and such counterpart originals or
certified or other copies of such documents as the Agent may reasonably
request.
11. EVENTS OF DEFAULT; ACCELERATION; ETC.
------------------------------------------
11.1. Events of Default and Acceleration. If any of the
following events ("Events of Default" or, if the giving of notice or the
lapse of time or both is required, then, prior to such notice or lapse of
time, "Defaults") shall occur:
(a) the Borrower shall fail to pay any principal of the Loans when
the same shall become due and payable, whether at the stated date of
maturity or any accelerated date of maturity or at any other date fixed
for payment;
(b) the Borrower shall fail to pay any interest on the Loans, the
facility fee, or other sums due hereunder or under any of the other Loan
Documents, when the same shall become due and
-62-
payable, whether at the stated date of maturity or any accelerated date
of maturity or at any other date fixed for payment;
(c) the Borrower shall fail to comply with any of its covenants
contained in Section Section 6, 7 or 8;
(d) the Borrower or any of its Subsidiaries shall fail to perform
any term, covenant or agreement contained herein or in any of the other
Loan Documents (other than those specified elsewhere in this Section 11)
for fifteen (15) days after written notice of such failure has been given
to the Borrower by the Agent;
(e) any representation or warranty of the Borrower or any of its
Subsidiaries in this Credit Agreement or any of the other Loan Documents
or in any other document or instrument delivered pursuant to or in
connection with this Credit Agreement shall prove to have been false in
any material respect upon the date when made or deemed to have been made
or repeated;
(f) the Borrower or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized
Leases, or fail to observe or perform any material term, covenant or
agreement contained in any agreement by which it is bound (excluding,
however, any such term, covenant or agreement relating to the pledge or
disposition of capital stock of the Borrower or other Margin Stock for so
long as such stock constitutes Margin Stock), evidencing or securing
borrowed money or credit received or in respect of any Capitalized Leases
for such period of time as would permit (assuming the giving of
appropriate notice if required) the holder or holders thereof or of any
obligations issued thereunder to accelerate the maturity thereof;
(g) the Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of the Borrower or any of its
Subsidiaries or of any substantial part of the assets of the Borrower or
any of its Subsidiaries or shall commence any case or other proceeding
relating to the Borrower or any of its Subsidiaries under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation or similar law of any jurisdiction, now or
hereafter in effect, or shall take any action to authorize or in
furtherance of any of the foregoing, or if any such
-63-
petition or application shall be filed or any such case or other
proceeding shall be commenced against the Borrower or any of its
Subsidiaries and the Borrower or any of its Subsidiaries shall indicate
its approval thereof, consent thereto or acquiescence therein or such
petition or application shall not have been dismissed within forty-five
(45) days following the filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of
its Subsidiaries bankrupt or insolvent, or approving a petition in any
such case or other proceeding, or a decree or order for relief is entered
in respect of the Borrower or any Subsidiary of the Borrower in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty days, whether or not consecutive, any
final judgment against the Borrower or any of its Subsidiaries that, with
other outstanding final judgments, undischarged, against the Borrower or
any of its Subsidiaries exceeds in the aggregate $1,000,000;
(j) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded, in each case otherwise than with the express prior
written agreement, consent or approval of the Banks, or any action at
law, suit or in equity or other legal proceeding to cancel, revoke or
rescind any of the loan documents shall be commenced by or on behalf of
the Borrower or any of its Subsidiaries party thereto or any of their
respective stockholders, or any court or any other governmental or
regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof;
(k) the Borrower or any ERISA Affiliate incurs any liability to the
PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in an
aggregate amount exceeding $2,000,000; the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of ERISA
by a Multiemployer Plan requiring aggregate annual payments exceeding
$2,000,000, or any of the following occurs with respect to a Guaranteed
Pension Plan: (i) an ERISA Reportable Event, or a failure to make a
required installment or other payment (within the meaning of Section
302(f)(1) of ERISA), provided the Agent determines in its reasonable
discretion that such event
-64-
(A) could be expected to result in liability of the Borrower to the PBGC
or the Plan in an aggregate amount exceeding $2,000,000 and (B) could
constitute grounds for the termination of such Plan by the PBGC, for the
appointment by the appropriate United States District Court of a trustee
to administer such Plan or for the imposition of a lien in favor of the
Guaranteed Pension Plan; (ii) the appointment by a United States District
Court of a trustee to administer such Plan; or (iii) the institution by
the PBGC of proceedings to terminate such Plan;
(l) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any court or any
administrative or regulatory agency from conducting any material part of
its business and such order shall continue in effect for more than thirty
(30) days;
(m) there shall occur any material damage to, or loss, theft or
destruction of, any assets of the Borrower or its Subsidiaries, whether
or not insured, or any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty, which in any
such case causes, for more than fifteen (15) consecutive days, the
cessation or substantial curtailment of revenue producing activities at
any facility of the Borrower or any of its Subsidiaries if such event or
circumstance is not covered by business interruption insurance and would
have a material adverse effect on the business or financial condition of
the Borrower and its Subsidiaries on a consolidated basis;
(n) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired by
the Borrower or any of its Subsidiaries if such loss, suspension,
revocation or failure to renew would have a material adverse effect on
the business or financial condition of the Borrower and its Subsidiaries
on a consolidated basis;
(o) the Borrower or any of its Subsidiaries shall be indicted for a
state or federal crime, or any civil or criminal action shall otherwise
have been brought or threatened against the Borrower or any of its
Subsidiaries, a punishment for which in any such case could include the
forfeiture of any assets of the Borrower and its Subsidiaries having a
fair market value in excess of $5,000,000; or
(p) (i) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended, but
other than ▇▇▇ ▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇) shall
-65-
have acquired beneficial ownership (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under said Act) of
twenty percent (20%) or more of the outstanding shares of common stock of
the Borrower; (ii) ▇▇▇ ▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) of twenty-five percent
(25%) or more of the outstanding shares of common stock of the Borrower;
or (iii) during any period of twelve (12) consecutive calendar months,
individuals who were directors of the Borrower on the first day of such
period shall cease to constitute a majority of the board of directors of
the Borrower;
then, and in any such event, so long as the same may be continuing, the
Agent may, and upon the request of the Majority Banks shall, by notice in
writing to the Borrower declare all amounts owing with respect to this
Credit Agreement, the Notes and the other Loan Documents to be, and they
shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower; provided that in the event
of any Event of Default specified in Section 11.1(g) or 11.1(h), all such
amounts shall become immediately due and payable automatically and
without any requirement of notice from the Agent or any Bank.
11.2. Termination of Commitments. If any one or more of the
Events of Default specified in Section 11.1(g) or Section 11.1(h) shall
occur, any unused portion of the credit hereunder shall forthwith
terminate and each of the Banks shall be relieved of all obligations to
make Loans to the Borrower. If any other Event of Default shall have
occurred and be continuing, or if on any Drawdown Date the conditions
precedent to the making of the Loans to be made on such Drawdown Date are
not satisfied, the Agent may and, upon the request of the Majority Banks,
shall, by notice to the Borrower, terminate the unused portion of the
credit hereunder, and upon such notice being given such unused portion of
the credit hereunder shall terminate immediately and each of the Banks
shall be relieved of all further obligations to make Loans. If any such
notice is given to the Borrower the Agent will forthwith furnish a copy
thereof to each of the Banks. No termination of the credit hereunder
shall relieve the Borrower of any of the Obligations or any of its
existing obligations to any of the Banks arising under other agreements
or instruments.
11.3. Remedies. In case any one or more of the Events of Default
shall have occurred and be continuing, and whether or not the Banks shall
have accelerated the maturity of the Loans pursuant to Section 11.1, each
Bank, if owed any amount with respect to the Loans, may, with the consent
of
-66-
the Majority Banks but not otherwise, proceed to protect and enforce its
rights by suit in equity, action at law or other appropriate proceeding,
whether for the specific performance of any covenant or agreement
contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to such Bank are evidenced,
including as permitted by applicable law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any
other legal or equitable right of such Bank. No remedy herein conferred
upon any Bank or the Agent or the holder of any Note is intended to be
exclusive of any other remedy and each and every remedy shall be
cumulative and shall be in addition to every other remedy given hereunder
or now or hereafter existing at law or in equity or by statute or any
other provision of law.
121. SETOFF.
-------------
Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from
any of the Banks to the Borrower and any securities or other property of
the Borrower in the possession of such Bank may be applied to or set off
by such Bank against the payment of Obligations and any and all other
liabilities, direct, or indirect, absolute or contingent, due or to
become due, now existing or hereafter arising, of the Borrower to such
Bank. Each of the Banks agrees with each other Bank that (i) if an
amount to be set off is to be applied to Indebtedness of the Borrower to
such Bank, other than Indebtedness evidenced by the Notes held by such
Bank, such amount shall be applied ratably to such other Indebtedness and
to the Indebtedness evidenced by all such Notes held by such Bank, and
(ii) if such Bank shall receive from the Borrower, whether by voluntary
payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Notes held by such Bank by
proceedings against the Borrower at law or in equity or by proof thereof
in bankruptcy, reorganization, liquidation, receivership or similar
proceedings, or otherwise, and shall retain and apply to the payment of
the Note or Notes held by such Bank any amount in excess of its ratable
portion of the payments received by all of the Banks with respect to the
Notes held by all of the Banks, such Bank will make such disposition and
arrangements with the other Banks with respect to such excess, either by
way of distribution, pro tanto assignment of claims, subrogation or
otherwise as shall result in each Bank receiving in respect of the Notes
held by its proportionate payment as contemplated by this Credit
Agreement; provided that if all or any part of such excess payment is
thereafter recovered from such Bank, such disposition and arrangements
-67-
shall be rescinded and the amount restored to the extent of such
recovery, but without interest.
13. THE AGENT.
---------------
13.1. Authorization.
(a) The Agent is authorized to take such action on behalf of each
of the Banks and to exercise all such powers as are hereunder and under
any of the other Loan Documents and any related documents delegated to
the Agent, together with such powers as are reasonably incident thereto,
provided that no duties or responsibilities not expressly assumed herein
or therein shall be implied to have been assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is
that of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Credit Agreement nor the other Loan
Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to exercise
certain rights and perform certain duties and responsibilities hereunder
and under the other Loan Documents, the Agent is nevertheless a
"representative" of the Banks, as that term is defined in Article 1 of
the Uniform Commercial Code, for purposes of actions for the benefit of
the Banks and the Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents.
13.2. Employees and Agents. The Agent may exercise its powers
and execute its duties by or through employees or agents and shall be
entitled to take, and to rely on, advice of counsel concerning all
matters pertaining to its rights and duties under this Credit Agreement
and the other Loan Documents. The Agent may utilize the services of such
Persons as the Agent in its sole discretion may reasonably determine, and
all reasonable fees and expenses of any such Persons shall be paid by the
Borrower.
13.3. No Liability. Neither the Agent nor any of its
shareholders, directors, officers or employees nor any other Person
assisting them in their duties nor any agent or employee thereof, shall
be liable for any waiver, consent or approval given or any action taken,
or omitted to be
-68-
taken, in good faith by it or them hereunder or under any of the other
Loan Documents, or in connection herewith or therewith, or be responsible
for the consequences of any oversight or error of judgment whatsoever,
except that the Agent or such other Person, as the case may be, may be
liable for losses due to its willful misconduct or gross negligence.
13.4. No representations. The Agent shall not be responsible for
the execution or validity or enforceability of this Credit Agreement, the
Notes, any of the other Loan Documents or any instrument at anytime
constituting, or intended to constitute, collateral security for the
Notes, or for the value of any such collateral security or for the
validity, enforceability or collectability of any such amounts owing with
respect to the Notes, or for any recitals or statements, warranties or
representations made herein or in any of the other Loan Documents or in
any certificate or instrument hereafter furnished to it by or on behalf
of the Borrower, or be bound to ascertain or inquire as to the
performance or observance of any of the terms, conditions, covenants or
agreements herein or in any instrument at any time constituting, or
intended to constitute, collateral security for the Notes or to inspect
any of the properties, books or records of the Borrower or any of its
Subsidiaries. The Agent shall not be bound to ascertain whether any
notice, consent, waiver or request delivered to it by the Borrower or any
holder of any of the Notes shall have been duly authorized or is true,
accurate and complete. The Agent has not made nor does it now make any
representations or warranties, express or implied, nor does it assume any
liability to the Banks, with respect to the credit worthiness or
financial conditions of the Borrower or any of its Subsidiaries. Each
Bank acknowledges that it has, independently and without reliance upon
the Agent or any other Bank, and based upon such information and
documents as it has deemed appropriate, made its own credit analysis and
decision to enter into this Credit Agreement.
13.5. Payments.
13.5.1. Payments to Agent. A payment by the Borrower to the
Agent hereunder or any of the other Loan Documents for the account of any
Bank shall constitute a payment to such Bank. The Agent agrees promptly
to distribute to each Bank such Bank's pro rata share of payments
received by the Agent for the account of the Banks except as otherwise
expressly provided herein or in any of the other Loan Documents.
13.5.2. Distribution by Agent. If in the opinion of the Agent
the distribution of any amount received by it in such capacity hereunder,
under the Notes or under any of the other Loan Documents might involve it
in liability, it may refrain from making
-69-
distribution until its right to make distribution shall have been
adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and
distributed by the Agent is to be repaid, each Person to whom any such
distribution shall have been made shall either repay to the Agent its
proportionate share of the amount so adjudged to be repaid or shall pay
over the same in such manner and to such Persons as shall be determined
by such court.
13.5.3. Delinquent Banks. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Bank that fails (i) to make available to the Agent its pro
rata share of any Loan or (ii) to comply with the provisions of Section
12 with respect to making dispositions and arrangements with the other
Banks, where such Bank's share of any payment received, whether by setoff
or otherwise, is in excess of its pro rata share of such payments due and
to payable to all of the Banks, in each case as, when and to the full
extent required by the provisions of this Credit Agreement, shall be
deemed delinquent (a "Delinquent Bank") and shall be deemed a Delinquent
Bank until such time as such delinquency is satisfied. A Delinquent Bank
shall be deemed to have assigned any and all payments due to it from the
Borrower, whether on account of outstanding Loans, interest, fees or
otherwise, to the remaining nondelinquent Banks for application to, and
reduction of, their respective pro rata shares of all outstanding
Syndicated Loans. The Delinquent Bank hereby authorizes the Agent to
distribute such payments to the nondelinquent Banks in proportion to
their respective pro rata shares of all outstanding Syndicated Loans. A
Delinquent Bank shall be deemed to have satisfied in full a delinquency
when and if, as a result of application of the assigned payments to all
outstanding Syndicated Loans of the nondelinquent Banks, the Banks'
respective pro rata shares of all outstanding Syndicated Loans have
returned to those in effect immediately prior to such delinquency and
without giving effect to the nonpayment causing such delinquency.
13.6. Holders of Notes. The Agent may deem and treat the payee
of any Note as the absolute owner thereof for all purposes hereof until
it shall have been furnished in writing with a different name by such
payee or by a subsequent holder.
13.7. Indemnity. The Banks ratably agree hereby to indemnify and
hold harmless the Agent and its Affiliates from and against any and all
claims, actions and suits (whether groundless or otherwise), losses,
-70-
damages, costs, expenses (including any expenses for which the Agent or
any of its Affiliates has not been reimbursed by the Borrower as required
by Section 14), and liabilities of every nature and character arising out
of or related to this Credit Agreement, the Notes, or any of the other
Loan Documents or the transactions contemplated or evidenced hereby or
thereby, or the Agent's or any of its Affiliate's actions taken hereunder
or thereunder, except to the extent that any of the same shall be
directly caused by the Agent's or such Affiliate's willful misconduct or
gross negligence.
13.8. Agent as Bank. In its individual capacity, BKB shall have
the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Loans made by it, and as the holder of
any of the Notes, as it would have were it not also the Agent.
13.9. Resignation. The Agent may resign at any time by giving
sixty (60) days prior written notice thereof to the Banks and the
Borrower. Upon any such resignation, the Majority Banks shall have the
right to appoint a successor Agent. Unless a Default or Event of Default
shall have occurred and be continuing, such successor Agent shall be
reasonably acceptable to the Borrower. If no successor Agent shall have
been so appointed by the Majority Banks and shall have accepted such
appointment within thirty (30) days after the retiring Agent's giving of
notice of resignation, then the retiring Agent may, on behalf of the
Banks, appoint a successor Agent, which shall be a financial institution
having a rating of not less than A or its equivalent by Standard & Poor's
Corporation. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. After any retiring Agent's
resignation, the provisions of this Credit Agreement and the other Loan
Documents 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 Agent.
13.10. Notification of Defaults and Events of Default. Each Bank
hereby agrees that, upon learning of the existence of a Default or an
Event of Default, it shall promptly notify the Agent thereof. The Agent
hereby agrees that upon receipt of any notice under this Section 13.10 it
shall promptly notify the other Banks of the existence of such Default or
Event of Default.
13.11. Limitation on Duties. Notwithstanding anything to the
contrary contained in this Credit Agreement or any other Loan Document,
neither the Documentation Agent, in its capacity as such, nor the
-71-
Arranger shall have any obligations hereunder or under any other Loan
Document, or any fiduciary relationship with any Bank.
14. EXPENSES.
--------------
The Borrower agrees to pay (i) the reasonable costs of producing and
reproducing this Credit Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (ii) any taxes (including
any interest and penalties in respect thereto) payable by the Agent, any
of its Affiliates or any of the Banks (other than taxes based upon the
Agent's, such Affiliate's or any Bank's net income) on or with respect to
the transactions contemplated by this Credit Agreement (the Borrower
hereby agreeing to indemnify the Agent and each Bank with respect
thereto), (iii) the reasonable fees, expenses and disbursements of the
Agent's Special Counsel or any local counsel to the Agent incurred in
connection with the preparation, administration or interpretation of the
Loan Documents and other instruments mentioned herein, each closing
hereunder, and amendments, modifications, approvals, consents or waivers
hereto or hereunder, (iv) the reasonable fees, expenses and disbursements
of the Agent incurred by the Agent in connection with the preparation,
syndication, administration or interpretation of the Loan Documents and
other instruments mentioned herein, including in connection with the
conduct of any commercial finance examinations, (v) all reasonable out-
of-pocket expenses (including without limitation reasonable attorneys'
fees and costs, which attorneys may be employees of any Bank or the
Agent, and reasonable consulting, accounting, appraisal, and similar
professional fees and charges) incurred by any Bank or the Agent in
connection with (A) the enforcement of or preservation of rights under
any of the Loan Documents against the Borrower or any of its Subsidiaries
or the administration thereof after the occurrence of a Default or Event
of Default and (B) any litigation, proceeding or dispute whether arising
hereunder or otherwise, in any way related to any Bank's or the Agent's
relationship with the Borrower or any of its Subsidiaries and (vi) all
reasonable fees, expenses and disbursements of any Bank or the Agent
incurred in connection with UCC searches. The covenants of this Section
14 shall survive payment or satisfaction of payment of amounts owing with
respect to the Notes.
15. INDEMNIFICATION.
---------------------
The Borrower agrees to indemnify and hold harmless the Agent and the
Banks from and against any and all claims, actions and suits whether
groundless or otherwise, and from and against any and all liabilities,
losses, damages and expenses of every nature and character arising out of
this Credit Agreement or any of the other Loan Documents or the
-72-
transactions contemplated hereby including, without limitation, (i) any
actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Loans, (ii) the Borrower or any of its
Subsidiaries entering into or performing this Credit Agreement or any of
the other Loan Documents or (iii) with respect to the Borrower and its
Subsidiaries and their respective properties and assets, the violation of
any Environmental Law, the presence, disposal, escape, seepage, leakage,
spillage, discharge, emission, release or threatened release of any
Hazardous Substances or any action, suit, proceeding or investigation
brought or threatened with respect to any Hazardous Substances
(including, but not limited to claims with respect to wrongful death,
personal injury or damage to property), in each case including, without
limitation, the reasonable fees and disbursements of counsel and
allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding. In litigation, or the
preparation therefor, the Banks and the Agent shall be entitled to select
their own counsel and, in addition to the foregoing indemnity, the
Borrower agrees to pay promptly the reasonable fees and expenses of such
counsel. If, and to the extent that the obligations of the Borrower
under this Section 15 are unenforceable for any reason, the Borrower
hereby agrees to make the maximum contribution to the payment in
satisfaction of such obligations which is permissible under applicable
law. The covenants contained in this Section 15 shall survive payment of
satisfaction in full of all other obligations.
16. SURVIVAL OF COVENANTS, ETC.
--------------------------------
All covenants, agreements, representations and warranties made herein, in
the Notes, in any of the other Loan Documents or in any documents or
other papers delivered by or on behalf of the Borrower or any of its
Subsidiaries pursuant hereto shall be deemed to have been relied upon by
the Banks and the Agent, notwithstanding any investigation heretofore or
hereafter made by any of them, and shall survive the making by the Banks
of the Loans, as herein contemplated, and shall continue in full force
and effect so long as any amount due under this Credit Agreement or the
Notes or any of the other Loan Documents remains outstanding or any Bank
has any obligation to make any Loans, and for such further time as may be
otherwise expressly specified in this Credit Agreement. All statements
contained in any certificate or other paper delivered to any Bank or the
Agent at any time by or on behalf of the Borrower or any of its
Subsidiaries pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by
the Borrower or such Subsidiary hereunder.
-73-
17. ASSIGNMENT AND PARTICIPATION.
----------------------------------
17.1. Conditions to Assignment by Banks. Except as provided
herein, each Bank may assign to one or more Eligible Assignees all or a
portion of its interests, rights and obligations under this Credit
Agreement (including all or a portion of its Commitment Percentage and
Commitment and the same portion of the Loans at the time owing to it) and
the Notes held by it; provided that (i) each of the Agent and, unless a
Default or Event of Default shall have occurred and be continuing, the
Borrower shall have given its prior written consent to such assignment,
which consent, in the case of the Borrower and the Agent, will not be
unreasonably withheld, (ii) each such assignment shall be of a constant,
and not a varying, percentage of all the assigning Bank's rights and
obligations under this Credit Agreement, (iii) each assignment shall be
in an amount that is a whole multiple of $5,000,000, and (iv) each Bank
which is a Bank on the date hereof shall retain, free of any such
assignment, an amount of its Commitment of not less than $5,000,000, and
(v) the parties to such assignment shall execute and deliver to the
Agent, for recording in the Register (as hereinafter defined), an
Assignment and Acceptance, substantially in the form of Exhibit H hereto
(an "Assignment and Acceptance"), together with any Notes subject to such
assignment. Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five (5) Business Days
after the execution thereof, (i) the assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Bank hereunder, and (ii) the
assigning Bank shall, to the extent provided in such assignment and upon
payment to the Agent of the registration fee referred to in Section 17.3,
be released from its obligations under this Credit Agreement.
17.2. Certain Representations and Warranties; Limitations;
Covenants. By executing and delivering an Assignment and Acceptance, the
parties to the assignment thereunder confirm to and agree with each other
and the other parties hereto as follows:
(a) other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby free and
clear of any adverse claim, the assigning Bank makes no representation or
warranty, express or implied, and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection
with this Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Credit
Agreement, the other Loan Documents or any other instrument or document
-74-
furnished pursuant hereto or the attachment, perfection or priority of
any security interest or mortgage;
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower and its Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the
performance or observance by the Borrower and its Subsidiaries or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Credit Agreement or
any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in Section 5.4 and Section 6.4 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and
Acceptance;
(d) such assignee will, independently and without reliance upon the
assigning Bank, the Agent or any other Bank and based on such documents
and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Credit Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Credit Agreement and the other Loan Documents as are delegated to the
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto;
(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Bank; and
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance.
17.3. Register. The Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register or similar list
(the "Register") for the recordation of the names and addresses of the
Banks and the Commitment Percentage of, and principal amount of the
-75-
Loans owing to the Banks from time to time. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower,
the Agent and the Banks may treat each Person whose name is recorded in
the Register as a Bank hereunder for all purposes of this Credit
Agreement. The Register shall be available for inspection by the
Borrower and the Banks at any reasonable time and from time to time upon
reasonable prior notice. Upon each such recordation, the assigning Bank
agrees to pay to the Agent a registration fee in the sum of $3,500.
17.4. New Notes. Upon its receipt of an Assignment and
Acceptance executed by the parties to such assignment, together with each
Note subject to such assignment, the Agent shall (i) record the
information contained therein in the Register, and (ii) give prompt
notice thereof to the Borrower and the Banks (other than the assigning
Bank). Within five (5) Business Days after receipt of such notice, the
Borrower, at its own expense, shall execute and deliver to the Agent, in
exchange for each surrendered Note, a new Note to the order of such
Eligible Assignee in an amount equal to the amount assumed by such
Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Bank has retained some portion of its obligations hereunder, a
new Note to the order of the assigning Bank in an amount equal to the
amount retained by it hereunder. Such new Notes shall provide that they
are replacements for the surrendered Notes, shall be in an aggregate
principal amount equal to the aggregate principal amount of the
surrendered Notes, shall be dated the effective date of such Assignment
and Acceptance and shall otherwise be in substantially the form of the
assigned Notes. Within five (5) days of issuance of any new Notes
pursuant to this Section 17.4, the Borrower shall deliver an opinion of
counsel, addressed to the Banks and the Agent, relating to the due
authorization, execution and delivery of such new Notes and the legality,
validity and binding effect thereof, in form and substance reasonably
satisfactory to the Banks. The surrendered Notes shall be cancelled and
returned to the Borrower.
17.5. Participations. Each Bank may sell participations to one
or more banks or other entities in all or a portion of such Bank's rights
and obligations under this Credit Agreement and the other Loan Documents;
provided that (i) each such participation shall be in an amount of not
less than $5,000,000, (ii) any such sale or participation shall not
affect the rights and duties of the selling Bank hereunder to the
Borrower and (iii) the only rights granted to the participant pursuant to
such participation arrangements with respect to waivers, amendments or
modifications of the Loan Documents shall be the rights to approve
waivers, amendments or modifications that would reduce the principal of
or the interest rate on any Loans, extend the term or increase the amount
of the Commitment of such Bank as it relates to such participant, reduce
the amount of any
-76-
facility fees to which such participant is entitled or extend any
regularly scheduled payment date for principal or interest.
17.6. Disclosure. The Borrower agrees that in addition to
disclosures made in accordance with standard and customary banking
practices any Bank may disclose information obtained by such Bank
pursuant to this Credit Agreement to assignees or participants and
potential assignees or participants hereunder; provided that such
assignees or participants or potential assignees or participants shall
agree (i) to treat in confidence such information unless such information
otherwise becomes public knowledge, (ii) not to disclose such information
to a third party, except as required by law or legal process and (iii)
not to make use of such information for purposes of transactions
unrelated to such contemplated assignment or participation.
17.7. Assignee or Participant Affiliated with the Borrower. If
any assignee Bank is an Affiliate of the Borrower, then any such assignee
Bank shall have no right to vote as a Bank hereunder or under any of the
other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to any of the
Loan Documents or for purposes of making requests to the Agent pursuant
to Section 11.1 or Section 11.2, and the determination of the Majority
Banks shall for all purposes of this Agreement and the other Loan
Documents be made without regard to such assignee Bank's interest in any
of the Loans. If any Bank sells a participating interest in any of the
Loans to a participant, and such participant is the Borrower or an
Affiliate of the Borrower, then such transferor Bank shall promptly
notify the Agent of the sale of such participation. A transferor Bank
shall have no right to vote as a Bank hereunder or under any of the other
Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or modifications to any of the Loan
Documents or for purposes of making requests to the Agent pursuant to
Section 11.1 or Section 11.2 to the extent that such participation is
beneficially owned by the Borrower or any Affiliate of the Borrower, and
the determination of the Majority Banks shall for all purposes of this
Agreement and the other Loan Documents be made without regard to the
interest of such transferor Bank in the Loans to the extent of such
participation.
17.8. Miscellaneous Assignment Provisions. Any assigning Bank
shall retain its rights to be indemnified pursuant to Section 15 with
respect to any claims or actions arising prior to the date of such
assignment. If any assignee Bank is not incorporated under the laws of
the United States of America or any state thereof, it shall, prior to the
date on which any interest or fees are payable hereunder or under any of
the other Loan Documents for its account, deliver to the Borrower and the
Agent
-77-
certification as to its exemption from deduction or withholding of any
United States federal income taxes. If BKB transfers all of its
interest, rights and obligations under this Credit Agreement, the Agent
shall, in consultation with the Borrower and with the consent of the
Borrower and the Majority Banks, appoint another Bank to act as a
reference bank hereunder for purposes of the definition of Eurodollar
Rate. Anything contained in this Section 17 to the contrary
notwithstanding, any Bank may at any time pledge all or any portion of
its interest and rights under this Credit Agreement (including all or any
portion of its Notes) to any of the twelve Federal Reserve Banks
organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section
341. No such pledge or the enforcement thereof shall release the pledgor
Bank from its obligations hereunder or under any of the other Loan
Documents.
17.9. Assignment by Borrower. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Banks.
18. NOTICES, ETC.
------------------
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to
this Credit Agreement or the Notes shall be in writing and shall be
delivered in hand, mailed by United States registered or certified first
class mail, postage prepaid, sent by overnight courier, or sent by
telegraph, telecopy, telefax or telex and confirmed by delivery via
courier or postal service, addressed as follows:
(a) if to the Borrower, at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, or at such other address for notice
as the Borrower shall last have furnished in writing to the Person giving
the notice;
(b) if to the Agent, at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Director, or such other
address for notice as the Agent shall last have furnished in writing to
the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on Schedule 1
hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight
courier or facsimile to a responsible officer of the party to which it is
directed, at the time of the receipt thereof by such officer or the
sending of
-78-
such facsimile and (ii) if sent by registered or certified first-class
mail, postage prepaid, on the third Business Day following the mailing
thereof.
19. GOVERNING LAW.
-------------------
THIS CREDIT AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS, EXCEPT
AS OTHERWISE SPECIFICALLY PROVIDED THEREIN, ARE CONTRACTS UNDER THE LAWS
OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID
COMMONWEALTH OF MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO
CONFLICTS OR CHOICE OF LAW). THE BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY
FEDERAL COURT SITTING THEREIN AND CONSENT TO THE NONEXCLUSIVE
JURISDICTION OF SUCH COURT AND THE SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN Section
18. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT
SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
20. HEADINGS.
--------------
The captions in this Credit Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.
21. COUNTERPARTS.
------------------
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of
which when so executed and delivered shall be an original, and all of
which together shall constitute one instrument. In proving this Credit
Agreement it shall not be necessary to produce or account for more than
one such counterpart signed by the party against whom enforcement is
sought.
22. ENTIRE AGREEMENT, ETC.
---------------------------
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties
with respect to the transactions contemplated hereby. Neither
-79-
this Credit Agreement nor any term hereof may be changed, waived,
discharged or terminated, except as provided in Section 24.
23. WAIVER OF JURY TRIAL.
--------------------------
The Borrower hereby waives its right to a jury trial with respect to any
action or claim arising out of any dispute in connection with this Credit
Agreement, the Notes or any of the other Loan Documents, any rights or
obligations hereunder or thereunder or the performance of such rights and
obligations. Except as prohibited by law, the Borrower hereby waives any
right it may have to claim or recover in any litigation referred to in
the preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages.
The Borrower (i) certifies that no representative, agent or attorney of
any Bank or the Agent has represented, expressly or otherwise, that such
Bank or the Agent would not, in the event of litigation, seek to enforce
the foregoing waivers and (ii) acknowledges that the Agent and the Banks
have been induced to enter into this Credit Agreement, the other Loan
Documents to which it is a party by, among other things, the waivers and
certifications contained herein.
24. CONSENTS, AMENDMENTS, WAIVERS, ETC.
----------------------------------------
Except as otherwise expressly provided in this Credit Agreement, any
consent or approval required or permitted by this Credit Agreement to be
given by one or more or all of the Banks may be given, and any term of
this Credit Agreement or of any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower of any terms of this Credit Agreement or such other instrument
or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower
and the written consent of the Majority Banks. Notwithstanding the
foregoing, the rate of interest on the Notes (other than interest
accruing pursuant to Section 4.11.2 following the effective date of any
waiver by the Majority Banks of the Default or Event of Default relating
thereto), the term of the Notes, the amount of the Commitments of the
Banks, and the amount of the facility fee hereunder may not be changed
without the written consent of the Borrower and the written consent of
each Bank affected thereby; the definition of Majority Banks may not be
amended without the written consent of all of the Banks; and the amount
of the Agent's fee and Section 13 may not be amended without the written
consent of the Agent. No waiver shall extend to or affect any obligation
not expressly waived or impair any right consequent thereon. No course
of dealing or delay or omission on the part of any Bank in
-80-
exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No notice to or demand upon the Borrower shall
entitle the Borrower to other or further notice or demand in similar or
other circumstances.
25. SEVERABILITY.
------------------
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in
whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part
thereof, in such jurisdiction, and shall not in any manner affect such
clause or provision in any other jurisdiction, or any other clause or
provision of this Credit Agreement in any jurisdiction.
26. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
---------------------------------------------------
26.1. Confidentiality. Each of the Agent and the Banks agrees to
keep any information delivered or made available to it by or on behalf of
the Borrower or any its Subsidiaries confidential from anyone other than
its employees, officers, attorneys and other advisors or any Section 20
Subsidiary, provided that nothing herein shall prevent the Agent or such
Bank from disclosing such information upon the order or request of any
court or administrative agency or authority, upon the request or demand
of any regulatory agency or authority, to the extent that such
information has been publicly disclosed other than as a result of a
disclosure by the Agent or such Bank, otherwise as required by law or to
any actual or potential assignee or participant hereof pursuant to
Section 17.6. The Borrower agrees that it will, and will cause each of
its Subsidiaries to, keep any information delivered or made available to
it by or on behalf of the Agent or any of the Banks confidential from
anyone other than its employees, officers, attorneys and other advisors,
provided that nothing herein shall prevent the Borrower from disclosing
such information upon the order or request of any court or administrative
agency or authority, upon the request or demand of any regulatory agency
or authority, to the extent that such information has been publicly
disclosed other than as a result of disclosure by the Borrower or any of
its Subsidiaries, or otherwise as required by law.
26.2. Prior Notification. Unless specifically prohibited by
applicable law or court order, each of the Banks and the Agent shall,
prior to disclosure thereof, notify the Borrower of any request for
disclosure of any such non-public information by any governmental agency
or representative thereof (other than any such request in connection with
an
-81-
examination of the financial condition of such Bank by such governmental
agency) or pursuant to legal process.
26.3. Other. In no event shall any Bank or the Agent be
obligated or required to return any materials furnished to it or any
Section 20 Subsidiary by the Borrower. The obligations of each Bank
under this Section 26 shall supersede and replace the obligations of such
Bank under any confidentiality letter in respect of the financing
contemplated by this Credit Agreement or the Original Credit Agreement
and signed and delivered by such Bank to the Borrower prior to the date
hereof, and shall be binding upon any assignee of, or purchaser of any
participation in, any interest in any of the Loans from any Bank.
27. TRANSITIONAL ARRANGEMENTS.
-------------------------------
27.1. Original Credit Agreement Superseded. This Agreement shall
supersede the Original Credit Agreement in its entirety, except as
provided in this Section 27. On the Closing Date, the rights and
obligations of the parties under the Original Credit Agreement and the
"Notes" (as defined in the Original Credit Agreement) issued in favor of
the Banks under the Original Credit Agreement (as defined therein) shall
(other than any rights available to the Agent and the Banks under Section
16 and Section 17 of the Original Credit Agreement), be subsumed within
and be governed by this Credit Agreement and the other Loan Documents;
provided, however, that each of the "Loans" (as defined in the Original
Credit Agreement) outstanding under the Original Credit Agreement on the
Closing Date shall, for purposes of this Credit Agreement, be Loans, and
shall continue to bear interest or be subject to fees at the respective
rates in effect immediately prior to the Closing Date, in the case of
Base Rate Loans, and immediately prior to the end of the applicable
Interest Period, in the case of Eurodollar Rate Loans and Competitive Bid
Loans (with the Applicable Eurodollar Rate Margin to be applied on and
after the Closing Date to be equal to the Applicable Eurodollar Rate
Margin set forth herein and the Applicable Eurodollar Rate Margin to be
applied before the Closing Date to be the Applicable Eurodollar Rate
Margin (as defined in the Original Credit Agreement)).
27.2. Return and Cancellation of Notes. Upon its receipt of its
Note or Notes hereunder on the Closing Date, each Bank will promptly
return to the Borrower, marked "Canceled", any notes of the Borrower held
by such Bank pursuant to the Original Credit Agreement.
27.3. Fees Under Original Credit Agreement. All facility,
Agent's and other fees and expenses owing or accruing under or in respect
of the Original Credit Agreement through the Closing Date shall be
calculated as
-82-
of the Closing Date (prorated in the case of any fractional periods), and
shall be paid in accordance with the method, and on the dates, specified
in the Original Credit Agreement, as if the Original Credit Agreement
were still in effect.
28. Replacement Documents.
---------------------------
Upon receipt of an affidavit (reasonably satisfactory in form and
substance to the Borrower) of an officer of any Bank or the Agent as to
the loss, theft, destruction or mutilation of any Note or any Guaranty,
the Borrower will issue, in lieu thereof, a replacement Note or Guaranty
in the form previously executed and delivered by the Borrower to such
Bank or the Agent; provided, however, that the Borrower acknowledges and
agrees that any such affidavit need not contain an indemnification from
the Agent or, as the case may be, such Bank.
[Remainder of page intentionally left blank]
-83-
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
NEW ENGLAND BUSINESS SERVICE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Vice President and
Chief Financial Officer
BANKBOSTON, N.A. formerly
known as The First National Bank of
Boston, individually and as Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
-------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Director
FLEET NATIONAL BANK,
individually and as Documentation
Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President