Exhibit 4.3
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AMENDED AND RESTATED CREDIT AGREEMENT
dated as of April 18, 2002
among
AMERICAN SEAFOODS HOLDINGS LLC,
AMERICAN SEAFOODS CONSOLIDATED LLC,
AMERICAN SEAFOODS GROUP LLC,
THE LENDERS FROM TIME TO TIME PARTY HERETO
and
BANK OF AMERICA, N.A.,
as Administrative Agent, Issuing Lender and Swingline Lender
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▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
as Documentation Agent
THE BANK OF NOVA SCOTIA,
as Syndication Agent
BANC OF AMERICA SECURITIES LLC,
as Lead Arranger and Book Manager
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01 Definitions ...............................................................................3
Section 1.02 Computation of Time Periods and other Definitional Provisions ............................40
Section 1.03 Accounting Terms and Determinations ......................................................40
Section 1.04 Classes and Types of Borrowings ..........................................................40
ARTICLE II
THE CREDIT FACILITIES
Section 2.01 Revolving Loans ..........................................................................41
Section 2.02 Letter of Credit Subfacility .............................................................43
Section 2.03 Tranche A Term Loans .....................................................................48
Section 2.04 Tranche B Term Loans .....................................................................51
Section 2.05 Swingline Subfacility ....................................................................54
Section 2.06 Certain Provisions Pertinent to Notes ....................................................55
ARTICLE III
PROVISIONS GENERALLY APPLICABLE TO CREDIT FACILITIES
Section 3.01 Interest .................................................................................56
Section 3.02 Extension and Conversion .................................................................57
Section 3.03 Prepayments ..............................................................................58
Section 3.04 Adjustment of Commitments ................................................................61
Section 3.05 Fees .....................................................................................63
Section 3.06 Increased Costs and Reduced Return .......................................................64
Section 3.07 Base for Determining Interest Rate Inadequate or Unfair ..................................65
Section 3.08 Illegality ...............................................................................66
Section 3.09 Treatment of Affected Loans ..............................................................66
Section 3.10 Taxes ....................................................................................66
Section 3.11 Funding Losses ...........................................................................69
Section 3.12 Pro Rata Treatment .......................................................................69
Section 3.13 Sharing of Payments ......................................................................70
Section 3.14 Payments; Computations ...................................................................70
Section 3.15 Evidence of Debt .........................................................................72
ARTICLE IV
CONDITIONS
Section 4.01 Conditions to Effectiveness ..............................................................72
Section 4.02 Conditions to All Credit Events ..........................................................80
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.01 Financial Condition ......................................................................80
Section 5.02 No Material Change .......................................................................82
Section 5.03 Organization and Good Standing ...........................................................82
Section 5.04 Power; Authorization; Enforceable Obligations ............................................82
Section 5.05 No Conflicts .............................................................................83
Section 5.06 No Default ...............................................................................83
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Section 5.07 Assets ...................................................................................83
Section 5.08 Debt .....................................................................................83
Section 5.09 Litigation ...............................................................................83
Section 5.10 Taxes ....................................................................................84
Section 5.11 Compliance with Law ......................................................................84
Section 5.12 ERISA ....................................................................................84
Section 5.13 Subsidiaries .............................................................................85
Section 5.14 Governmental Regulations, Etc ............................................................85
Section 5.15 Purpose of Loans and Letters of Credit ...................................................86
Section 5.16 Environmental Matters ....................................................................86
Section 5.17 Intellectual Property ....................................................................87
Section 5.18 Solvency .................................................................................88
Section 5.19 Investments ..............................................................................88
Section 5.20 Location of Collateral ...................................................................88
Section 5.21 Disclosure ...............................................................................89
Section 5.22 No Burdensome Restrictions; Material Agreements ..........................................89
Section 5.23 Brokers' Fees ............................................................................90
Section 5.24 Labor Matters ............................................................................90
Section 5.25 Vessels; Fishing Rights ..................................................................90
Section 5.26 Condition and Use of the Vessels and Fishing Rights ......................................91
Section 5.27 Nature of Business .......................................................................92
Section 5.28 Representations and Warranties from Other Agreements .....................................92
Section 5.29 Security Documents .......................................................................92
Section 5.30 Transactions with Affiliates .............................................................93
Section 5.31 Ownership ................................................................................93
Section 5.32 Insurance ................................................................................94
Section 5.33 Certain Transactions .....................................................................94
ARTICLE VI
AFFIRMATIVE COVENANTS
Section 6.01 Information ..............................................................................94
Section 6.02 Preservation of Existence and Franchises .................................................98
Section 6.03 Books and Records ........................................................................98
Section 6.04 Compliance with Law ......................................................................98
Section 6.05 Payment of Taxes and Other Indebtedness ..................................................98
Section 6.06 Insurance; Certain Proceeds ..............................................................98
Section 6.07 Maintenance of Property .................................................................100
Section 6.08 Performance of Obligations ..............................................................100
Section 6.09 Use of Proceeds .........................................................................100
Section 6.10 Audits/Inspections ......................................................................100
Section 6.11 Additional Credit Parties; Additional Security ..........................................100
Section 6.12 Interest Rate Protection Agreements .....................................................103
Section 6.13 Contributions ...........................................................................103
Section 6.14 Compliance with the AFA .................................................................103
Section 6.15 Foreign Currency Rate Protection Agreements .............................................104
Section 6.16 Post Closing Matters ....................................................................104
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ARTICLE VII
NEGATIVE COVENANTS
Section 7.01 Limitation on Debt ......................................................................104
Section 7.02 Restriction on Liens ....................................................................106
Section 7.03 Nature of Business ......................................................................108
Section 7.04 Consolidation, Merger and Dissolution ...................................................108
Section 7.05 Asset Dispositions ......................................................................109
Section 7.06 Investments .............................................................................110
Section 7.07 Restricted Payments, etc ................................................................113
Section 7.08 Prepayments of Indebtedness, etc ........................................................114
Section 7.09 Transactions with Affiliates ............................................................115
Section 7.10 Fiscal Year; Organizational and Other Documents .........................................115
Section 7.11 Restrictions with Respect to Intercorporate Transfers ...................................116
Section 7.12 Ownership of Subsidiaries; Limitations on the Parent and the Borrowers ..................116
Section 7.13 Sale/Leasebacks .........................................................................117
Section 7.14 Capital Expenditures ....................................................................117
Section 7.15 Additional Negative Pledges .............................................................118
Section 7.16 Impairment of Security Interests ........................................................118
Section 7.17 Sales of Receivables ....................................................................118
Section 7.18 Financial Covenants .....................................................................118
Section 7.19 Independence of Covenants ...............................................................119
ARTICLE VIII
DEFAULTS
Section 8.01 Events of Default .......................................................................119
Section 8.02 Acceleration; Remedies ..................................................................121
Section 8.03 Allocation of Payments After Event of Default ...........................................122
ARTICLE IX
AGENCY PROVISIONS
Section 9.01 Appointment; Authorization ..............................................................124
Section 9.02 Delegation of Duties ....................................................................125
Section 9.03 Exculpatory Provisions ..................................................................125
Section 9.04 Reliance on Communications ..............................................................125
Section 9.05 Notice of Default .......................................................................126
Section 9.06 Non-Reliance on Agents and Other Lenders ................................................126
Section 9.07 Indemnification .........................................................................126
Section 9.08 Agents in Their Individual Capacity .....................................................127
Section 9.09 Successor Agent .........................................................................127
Section 9.10 Agents' Fees; Arranger Fee ..............................................................127
Section 9.11 AFA Compliance ..........................................................................128
ARTICLE X
MISCELLANEOUS
Section 10.01 Notices .................................................................................128
Section 10.02 Right of Set-Off ........................................................................130
Section 10.03 Benefit of Agreement ....................................................................131
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(continued)
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Section 10.04 No Waiver; Remedies Cumulative ..........................................................134
Section 10.05 Payment of Expenses; Indemnification ....................................................134
Section 10.06 Amendments, Waivers and Consents ........................................................135
Section 10.07 Counterparts ............................................................................138
Section 10.08 Headings ................................................................................138
Section 10.09 Defaulting Lenders ......................................................................138
Section 10.10 Survival of Indemnification and Representations and Warranties ..........................138
Section 10.11 Governing Law; Submission to Jurisdiction ...............................................138
Section 10.12 Waiver of Jury Trial ....................................................................139
Section 10.13 Severability ............................................................................139
Section 10.14 Entirety ................................................................................139
Section 10.15 Binding Effect ..........................................................................139
Section 10.16 Confidentiality .........................................................................139
Section 10.17 Source of Funds .........................................................................140
Section 10.18 Conflict ................................................................................140
Schedules:
Schedule 1.01A - Lenders and Commitments
Schedule 1.01C - Refinanced Agreements
Schedule 1.01D - Management Group
Schedule 1.01E - Vessel Permitted Liens
Schedule 4.01(c) - Adjusted Pro-Forma Consolidated EBITDA
Schedule 5.01 - Exceptions to GAAP; Liabilities
Schedule 5.02 - Material Change
Schedule 5.04 - Required Consents, Authorizations, Notices and Filings
Schedule 5.09 - Litigation
Schedule 5.10 - Tax Matters
Schedule 5.11 - Compliance with Law
Schedule 5.12 - ERISA
Schedule 5.13 - Subsidiaries
Schedule 5.16 - Environmental Matters
Schedule 5.17 - Intellectual Property
Schedule 5.20 - Locations of Collateral
Schedule 5.22 - Material Contracts
Schedule 5.23 - Broker's Fees
Schedule 5.24 - Labor Matters
Schedule 5.25 - Vessels and Fishing Rights
Schedule 5.26 - Condition and Use of Vessels and Fishing Rights
Schedule 5.28 - Representations and Warranties from Other Agreements
Schedule 5.29 - Recordings
Schedule 5.30 - Transactions with Affiliates
Schedule 5.31 - Ownership
Schedule 5.32 - Insurance
Schedule 7.01 - Indebtedness
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(continued)
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Schedule 7.06 - Existing Investments
Schedule 7.02 - Existing Liens
Schedule 7.09 - Transactions with Affiliates
Exhibits:
Exhibit A-1 - Form of Notice of Borrowing
Exhibit A-2 - Form of Notice of Extension/Conversion
Exhibit A-3 - Form of Letter of Credit Request
Exhibit A-4 - Form of Swingline Loan Request
Exhibit B-1 - Form of Revolving Note
Exhibit B-2 - Form of Tranche A Term Note
Exhibit B-3 - Form of Tranche B Term Note
Exhibit B-4 - Form of Swingline Note
Exhibit C - Form of Assignment and Assumption Agreement
Exhibit D-1 - Form of Opinion of Debevoise & ▇▇▇▇▇▇▇▇
Exhibit D-2 - Form of Opinion of Special Local Counsel for the Parent
and the Other Credit Parties
Exhibit D-3 - Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇
Exhibit E-1 - Form of Parent Guaranty
Exhibit E-2 - Form of Subsidiary Guaranty
Exhibit E-3 - Form of General Consent and Acknowledgment Agreement
Exhibit F-1 - Form of Amended and Restated Security Agreement
Exhibit F-2 - Form of Parent Pledge Agreement
Exhibit F-3 - Form of Pledge Agreement
Exhibit F-4 - Form of Perfection Certificate
Exhibit F-5 - Form of Mortgage
Exhibit F-6 - Form of Amended and Restated Preferred Ship Mortgage
Exhibit G - Form of Intercompany Note
Exhibit H - Form of Subordination Provisions
Exhibit I - Form of Joinder Agreement
Exhibit J - Form of Indemnity, Subrogation and Contribution Agreement
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AMENDED AND RESTATED CREDIT AGREEMENT
This Amended and Restated Credit Agreement is dated as of April 18,
2002 and is among AMERICAN SEAFOODS HOLDINGS LLC, a Delaware limited liability
company ("Holdings"), AMERICAN SEAFOODS CONSOLIDATED LLC, a Delaware limited
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liability company (the "Parent"), AMERICAN SEAFOODS GROUP LLC, a Delaware
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limited liability company (the "Borrower"), the banks and other financial
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institutions from time to time party hereto (the "Lenders"), ▇▇▇▇▇▇ TRUST AND
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SAVINGS BANK, as Documentation Agent, THE BANK OF NOVA SCOTIA, as Syndication
Agent, and BANK OF AMERICA, N.A., as Administrative Agent, Issuing Lender and
Swingline Lender.
Holdings, the Parent, ASC, Inc. (formerly known as American Seafoods
Company), a Washington corporation ("ASC"), the Borrower, Bank of America, N.A.,
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as Administrative Agent, Issuing Lender and Swingline Lender, U.S. Bank National
Association, as Syndication Agent, and certain banks and other financial
institutions (each an "Existing Lender" and, collectively, the "Existing
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Lenders") are parties to a Credit Agreement dated as of January 28, 2000 (as
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amended, supplemented or otherwise modified prior to the date hereof, the
"Original Credit Agreement"). Holdings, the Parent and the Borrower have
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requested the Administrative Agent, the Issuing Lender, the Swingline Lender,
certain of the Existing Lenders and one or more other banks or other financial
institutions who shall become Lenders hereunder to amend and restate the
Original Credit Agreement as set forth herein. The Administrative Agent, the
Issuing Lender, the Swingline Lender and the Lenders party hereto are willing to
consent to such amendment and restatement on the terms and conditions set forth
herein. Accordingly, in consideration of the mutual agreements set forth herein
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree that, effective on and as
of the Effective Date, the Original Credit Agreement is hereby amended and
restated to read in full as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. As used in this Agreement, the following
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terms shall have the meanings specified below unless the context otherwise
requires:
"Acknowledgment Agreement" means the General Consent and
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Acknowledgment, substantially in the form of Exhibit E-3 hereto, dated as of the
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Effective Date, among Holdings, the Parent, the Borrower, ASC, the Subsidiary
Guarantors, the Administrative Agent and the Collateral Agent.
"Additional Collateral Documents" has the meaning set forth in Section
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6.11.
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"Additional Subsidiary Guarantor" means each Person that becomes a
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Subsidiary Guarantor after the Effective Date by execution of a Joinder
Agreement as provided in Section 6.11.
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"Adjusted Base Rate " means the Base Rate plus the Applicable
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Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
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Applicable Percentage.
"Administrative Agent" means Bank of America, N.A., in its capacity as
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administrative agent for the Lenders hereunder and under the other Credit
Documents, and its successor or successors in such capacity.
"Administrative Questionnaire" means, with respect to each Lender, an
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administrative questionnaire in the form provided by the Administrative Agent
and submitted to the Administrative Agent (with a copy to the Borrower) duly
completed by such Lender.
"AFA" has the meaning set forth in Section 5.25.
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"Affected Loans" has the meaning set forth in Section 3.09.
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"Affected Type" has the meaning set forth in Section 3.09.
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"Affiliate" means, with respect to any Person, any other Person
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directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person. For purposes of this definition, "control" when
used with respect to any Person shall mean the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agency Services Address" means Bank of America, N.A., NC1-001-15-04,
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▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Agency Services,
or such other address as may be identified by written notice from the
Administrative Agent to the Borrower.
"Agents" means the Administrative Agent and the Collateral Agent,
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collectively, and "Agent" means either of them.
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"Agreement" means the Original Credit Agreement, as amended and
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restated on and as of the Effective Date to read in full as set forth in this
Amended and Restated Credit Agreement, as the same may be further amended,
restated, modified or supplemented from time to time.
"Applicable Lending Office" means, (i) with respect to any Lender and
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for each Type of Loan, the "Lending Office" of such Lender (or of an Affiliate
or Subsidiary of such Lender) designated for such Type of Loan in its
Administrative Questionnaire or such other office of such Lender (or of an
Affiliate or Subsidiary of such Lender) as such Lender may from time to time
specify to the Administrative Agent and the Borrower as the office by which its
Loans of such Type are to be made and maintained and (ii) with respect to any
Issuing Lender and for each Letter of Credit, the "Lending Office" of such
Issuing Lender (or of an Affiliate or Subsidiary of such Issuing Lender)
designated in its Administrative Questionnaire or such other office of such
Issuing Lender (or of an Affiliate or Subsidiary of such Issuing Lender) as such
Lender may from time to time specify to the Administrative Agent and the
Borrower as the office by which its Letters of Credit are to be issued and
maintained.
"Applicable Percentage" means: (i) for purposes of calculating the
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applicable interest rate for any day for any Tranche B Term Loan, 3.25% for
Eurodollar Loans and 2.25% for Base Rate Loans and (ii) for purposes of
calculating (A) the applicable interest rate for any day for any Revolving Loan,
any Swingline Loan or any Tranche A Term Loan, (B) the applicable rate of the
Commitment Fee for any day for purposes of Section 3.05(a), (C) the applicable
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rate of the fee for standby Letters of Credit for any day for purposes of
Section 3.05(b)(i) or (D) the applicable rate of the fee for trade Letters of
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Credit for any day for purposes of Section 3.05(b)(ii), the appropriate
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applicable percentage set forth below corresponding to the Leverage Ratio as of
the most recent Calculation Date with respect to Revolving Loans, Swingline
Loans, Tranche A Term Loans and all fees:
2
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Revolving Loans, Swingline Loans, Tranche A Term Loans and Fees
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Applicable Applicable Applicable Applicable
Percentage Applicable Percentage Percentage Percentage
For Percentage For Standby For Trade For
Pricing Leverage Eurodollar For Base Letter of Letter of Commitment
Level Ratio Loans Rate Loans Credit Fee Credit Fee Fees
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I **** 4.00 to 1.0 3.00% 2.00% 3.00% 3.00% .50%
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II * 4.00 to 1.0 2.75% 1.75% 2.75% 2.75% .50%
but
**** 3.50 to 1.0
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III * 3.50 to 1.0 2.50% 1.50% 2.50% 2.50% .375%
but
**** 3.00 to 1.0
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IV * 3.00 to 1.0 2.25% 1.25% 2.25% 2.25% .375%
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_______
* less than
**** greater than or equal to
Each Applicable Percentage with respect to Revolving Loans, Swingline
Loans, Tranche A Term Loans and fees shall be determined and adjusted quarterly
on the date (each a "Calculation Date") one Business Day after the date by which
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the Borrower is required to provide the consolidated financial information
required by Section 6.01(a) or (b) and the officer's certificate required by
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Section 6.01(c) for the fiscal quarter or year of the Borrower most recently
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ended prior to the Calculation Date; provided, however, that: (i) each such
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initial Applicable Percentage shall be based on Pricing Level I (as shown above)
and shall remain at Pricing Level I until the first Calculation Date occurring
after the end of the first two fiscal quarters of the Borrower ending subsequent
to the Effective Date and, thereafter, each such Applicable Percentage shall be
based on the Pricing Level (as shown above) corresponding to the Leverage Ratio
as of the last day of the most recently ended fiscal quarter or year of the
Borrower preceding the applicable Calculation Date; (ii) if the Borrower fails
to provide the consolidated financial information required by Section 6.01(a) or
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(b) or the officer's certificate required by Section 6.01(c) for the most
--- ---------------
recently ended fiscal quarter or year of the Borrower preceding any applicable
Calculation Date, each such Applicable Percentage from such Calculation Date
shall be based on Pricing Level I (as shown above) until such time as such
consolidated financial information and an appropriate officer's certificate is
provided, whereupon such Applicable Percentage shall be based on the Pricing
Level (as shown above) corresponding to the Leverage Ratio as of the last day of
the most recently ended fiscal quarter or year of the Borrower preceding such
Calculation Date; and (iii) if and for so long as any Event of Default shall
have occurred and be continuing, each such Applicable Percentage shall be based
on Pricing Level I (as shown above). Each Applicable Percentage shall be
effective from one Calculation Date until the next Calculation Date. Any
adjustment in such Applicable Percentages shall be applicable to all Revolving
Loans, Tranche A Term Loans and Letters of Credit then existing or subsequently
made or issued.
"Approval" means any approval, authorization, consent, qualification
--------
or registration, or any waiver of any of the foregoing, from, or any notice,
statement or other communication filed or to be filed with or delivered to, any
Governmental Authority or any other Person.
"Appurtenances" means, with respect to any Vessel, all of the engines,
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machinery, tools, fishing nets and other fishing gear, fish processing equipment
and supplies, boats, anchors, chains, tackle, fittings, navigation equipment,
spare parts, inventories, fuel, stores, supplies, plans, specifications,
engineering and architectural drawings, manuals and all other equipment and
appurtenances appertaining
3
to or belonging to such Vessel, whether or not on board such Vessel and wherever
located, and all Fishing Rights pertaining to such Vessel.
"ASC" means ASC, Inc., a Washington corporation formerly known as
---
American Seafoods Company, and its successors.
"ASC Norway Note" means the Senior Subordinated Promissory Note in the
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original principal amount of $50,000,000 issued by ASC in favor of Norway on
January 28, 2000.
"ASLP" means American Seafoods, L.P., a Delaware limited partnership,
----
and its successors.
"Asset Disposition" means any sale, lease or other disposition
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(including any such transaction effected by way of merger or consolidation and
including any sale or other disposition of the Capital Stock of a Subsidiary) by
any Consolidated Party of any asset, whether by sale, lease (including any
Sale/Leaseback Transaction, whether or not involving a Capital Lease), transfer,
Casualty, Condemnation or otherwise. The term "Asset Disposition" shall not
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include (i) any Equity Issuance, (ii) any issuance or sale of Capital Stock of a
Subsidiary in respect of directors' qualifying shares or shares required to be
owned by foreign nationals under applicable law unless and until (and only to
the extent that) the aggregate Net Cash Proceeds from such issuances or sales
pursuant to this clause (ii), when combined with all other such issuances and
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sales previously made during any fiscal year, exceeds $50,000 or (iii) the
receipt by any Consolidated Party of Insurance Proceeds or Condemnation Awards
in connection with one or more related events unless and until (and only to the
extent that) the aggregate proceeds or award or other compensation exceeds
$1,000,000 in the aggregate for all such events. This definition shall not be
deemed to imply that any such Asset Disposition is permitted under this
Agreement.
"Assignment and Assumption Agreement" means an Assignment and
-----------------------------------
Assumption Agreement, substantially in the form of Exhibit C hereto, under which
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an interest of a Lender hereunder is transferred to an Eligible Assignee
pursuant to Section 10.03(b).
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"Attributable Debt" means, in connection with any Sale/Leaseback
-----------------
Transaction described in Section 7.13 occurring subsequent to the Effective
------------
Date, the lesser of (i) the present value, discounted in accordance with GAAP at
the debt rate implicit in the related lease, of the obligations of the lessee
for rental payments over the remaining term of such lease (including any period
for which such lease has been extended or may, at the option of the lessor be
extended) and (ii) the fair market value of the assets subject to such
transaction.
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as amended,
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or any successor statute.
"Bankruptcy Event" means, with respect to any Person, (i) a
----------------
Governmental Authority having jurisdiction in the premises shall enter a decree
or order for relief in respect of such Person in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appoint a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or for any substantial part of
its property or order the winding up or liquidation of its affairs, (ii) an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect is commenced against such Person and such
petition remains unstayed and in effect for a period of 60 consecutive days,
(iii) such Person shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under any
such law, or consent to the appointment or taking possession by a receiver,
4
liquidator, assignee, custodian, trustee, sequestrator or similar official of
such Person or any substantial part of its property or make any general
assignment for the benefit of creditors or (iv) such Person shall admit in
writing its inability to pay its debts generally as they become due or any
action shall be taken by such Person in furtherance of any of the aforesaid
purposes.
"BAS" means Banc of America Securities LLC.
---
"Base Rate" means, for any day, a rate per annum equal to the higher
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of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Rate.
"Base Rate Loan" means at any date a Loan bearing interest at a rate
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determined by reference to the Base Rate.
"Borrower" means American Seafoods Group LLC, a Delaware limited
--------
liability company, and it successors.
"Borrower Debt Refinancing" means the refinancing on the Effective
-------------------------
Date of all outstanding Debt of the Borrower and its Subsidiaries, including,
without limitation, all Debt of the Borrower and its Subsidiaries outstanding
under the Refinanced Agreements, but excluding Debt outstanding on the Effective
Date under Existing Debt Agreements.
"Borrower Preferred Interests" means the preferred membership interest
----------------------------
in the Borrower issued by the Borrower to ASC on January 28, 2000 as partial
consideration for a contribution of assets by ASC to the Borrower.
"Borrowing" has the meaning set forth in Section 1.04.
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"Business" means the commercial fish catching, processing and
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marketing business carried on by the Borrower and its Subsidiaries as of the
Effective Date, including the ownership and charter (as lessee) of catcher and
catcher/processor vessels, the ownership or leasing of Fishing Rights, the
ownership, leasing and operation of fish, fish product and fish derivative
processing and storage facilities, the membership in fishing cooperatives, the
catching or purchasing of fish and the purchasing, processing, storing,
preserving, transporting and marketing of fish, fish products and fish
derivatives.
"Business Day" means any day except a Saturday, Sunday or other day on
------------
which commercial banks in Charlotte, North Carolina, Seattle, Washington or New
York, New York are authorized or required by law to close, except that (i) when
used in Section 2.02 with respect to any action taken by or with respect to any
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Issuing Lender, the term "Business Day" shall not include any day on which
commercial banks are authorized by law to close in the jurisdiction where such
Issuing Lender's Applicable Lending Office is located and (ii) if such day
relates to a borrowing of, a payment or prepayment of principal of or interest
on, or the Interest Period for, a Eurodollar Loan, or a notice by the Borrower
with respect to any such borrowing, payment, prepayment or Interest Period, that
is also a day on which commercial banks are open for international business
(including dealings in Dollar deposits) in London.
"Businesses" has the meaning set forth in Section 5.16.
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"Calculation Date" has the meaning set forth in the definition of
----------------
"Applicable Percentage" in this Section 1.01.
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5
"Capital Lease" of any Person means any lease of property or assets
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(whether real, personal or mixed) by such Person as lessee which would, in
accordance with GAAP, be required to be accounted for as a capital lease on the
balance sheet of such Person.
"Capital Stock" means (i) in the case of a corporation, capital stock,
-------------
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests, (v) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person and (vi) all rights to purchase,
warrants, options and other securities exercisable for, exchangeable for or
convertible into any of the foregoing.
"Cash Equivalents" means: (i) securities issued or directly and fully
----------------
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
--------
States of America is pledged in support thereof) having maturities of not more
than 12 months from the date of acquisition; (ii) Dollar-denominated
certificates of deposit of (A) any Lender, (B) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or (C)
any bank whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent thereof
(any such bank being an "Approved Bank"), in each case with maturities of not
-------------
more than 270 days from the date of acquisition; (iii) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation not an Affiliate of Holdings rated A-1 (or the equivalent
thereof) or better by S&P or P-1 (or the equivalent thereof) or better by
Moody's and maturing within six months of the date of acquisition; (iv)
repurchase agreements with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in excess of
$500,000,000 for securities described in clauses (i) and (ii) above in which the
----------- ----
Parent or one or more of its Subsidiaries shall have a perfected first priority
security interest (subject to no other Liens) and having, on the date of
purchase thereof, a fair market value of at least 100% of the amount of the
repurchase obligations; (v) Investments, classified in accordance with GAAP as
current assets, in money market investment programs registered under the
Investment Company Act of 1940, as amended, which are administered by reputable
financial institutions having capital of at least $500,000,000 and the
portfolios of which are limited to Investments of the character described in the
foregoing clauses (i) through (iv); and (vi) securities issued by any state of
----------- ----
the United States of America or any political subdivision, agency or
instrumentality of any such state maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having a rating of at least
AAA from S&P or at least Aaa from Moody's.
"Casualty" means any casualty, loss, damage, destruction or other
--------
similar loss with respect to real or personal property or improvements or from
business interruption.
"Casualty Insurance Policy" means any insurance policy maintained by
-------------------------
the Parent or one or more of its Subsidiaries covering losses with respect to
Casualties.
"Change of Control" means the occurrence of any of the following
-----------------
events:
(i) prior to a Qualifying IPO, (A) Holdings shall cease to own
directly 100% of the Capital Stock of the Parent, on a fully-diluted basis
assuming the conversion and exercise of all outstanding Equity Equivalents
(whether or not such securities are then currently convertible or
exercisable), (B) the Parent shall cease to own directly or indirectly
through ASC 100% of the Capital Stock of the Borrower, on a fully-diluted
basis as set forth in clause (A), (C) the Principals and their Related
----------
Parties shall fail to beneficially own, directly or indirectly
6
through ASLP, more than 50% of the Voting Securities of Holdings, on a
fully diluted basis as set forth in clause (A), (D) at any time prior to
----------
the Sponsor Release Date, the Sponsor Group together with the Management
Group or, at any time thereafter, the Principals and their Related Parties,
shall fail to control, directly or indirectly through ASLP, whether through
the ownership of Voting Securities or by contract, the sole managing member
of Holdings, or, if Holdings is at any time managed by a board of managers,
a majority of the seats on such board of managers (or other group
performing similar functions) of Holdings, or (E) the Sponsor Group shall
cease to own, directly or indirectly through ASLP, beneficially or of
record, Capital Stock of Holdings representing in the aggregate a
percentage of the Capital Stock of Holdings, on a fully-diluted basis as
set forth in clause (A), which is greater than the largest percentage of
----------
the Capital Stock of Holdings, on a fully-diluted basis as set forth in
clause (A), which is owned, beneficially or of record, by a "person" or
----------
"group" (within the meaning of Section 13(d) or 14(d) of the Exchange Act),
including any "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all securities that any such Person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time), other than a Principal, Norway or one or more of their Related
Parties; or
(ii) after a Qualifying IPO, (A) Holdings shall cease to own
directly 100% of the Capital Stock of the Parent, on a fully-diluted basis
as set forth in clause (i)(A) above, (B) the Parent shall cease to own,
-------------
directly or indirectly through ASC, 100% of the Capital Stock of the
Borrower, on a fully-diluted basis as set forth in clause (i)(A) above, or
-------------
(C) (x) any "person" or "group" (within the meaning of Section 13(d) or
14(d) of the Exchange Act) (other than the Principals and their Related
Parties) has become, directly or indirectly, the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
Person shall be deemed to have "beneficial ownership" of all securities
that any such Person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), by way of
merger, consolidation or otherwise, of 35% or more of the Voting Securities
of Holdings, on a fully-diluted basis as set forth in clause (i)(A) above,
-------------
or (y) such Person or group is or becomes, directly or indirectly, the
beneficial owner of a greater percentage of the voting power of the Voting
Securities of Holdings calculated on a fully-diluted basis as set forth in
clause (i)(A) above, than the percentage of the voting power of the Voting
-------------
Securities of Holdings owned directly or indirectly by the Principals and
their Related Parties; or
(iii) after a Qualifying IPO, during any period of two
consecutive calendar years, individuals who at the beginning of such period
constituted the board of managers (or persons performing similar functions)
of Holdings or of the sole managing member of Holdings, together with any
new members of such board of managers or directors, as applicable, (A)
whose elections by such board of managers or directors, as applicable, or
whose nominations for election by the members or managers, as applicable,
of Holdings or of the sole managing member of Holdings, was approved by a
vote a majority of the members of such board of managers or directors, as
applicable, then still in office who either were managers or directors, as
applicable, at the beginning of such period or whose election or nomination
for election was previously so approved or (B) elected by the Sponsor
Group, cease for any reason to constitute a majority of the managers or
directors, as applicable, of Holdings or of the sole managing member of
Holdings still in office; or
(iv) a "change of control" (as defined in the Senior Subordinated
Note Indenture) occurs.
"Class" has the meaning set forth in Section 1.04.
----- ------------
7
"Code" means the Internal Revenue Code of 1986, as amended, and any
----
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. Reference to particular
sections of the Code shall be construed also to refer to any successor sections.
"Co-Issuer" means American Seafoods, Inc., a Delaware corporation, and
---------
its successors.
"Collateral" means all of the property which is subject or is
----------
purported to be subject to the Liens granted by the Collateral Documents.
"Collateral Agent" means Bank of America, N.A., in its capacity as
----------------
collateral agent for the Lenders under the Collateral Documents, and its
successor or successors in such capacity.
"Collateral Documents" means, collectively, the Security Agreement,
--------------------
the Pledge Agreement, the Parent Pledge Agreement, the Depositary Bank
Agreements, the Mortgage Documents, the Vessel Mortgages, any Additional
Collateral Documents, any additional pledges, security agreements, patent,
trademark or copyright filings or mortgages required to be delivered pursuant to
the Credit Documents and any instruments of assignment, control agreements,
lockbox letters or other instruments or agreements executed pursuant to the
foregoing.
"Commitment" means (i) with respect to each Lender, its Revolving
----------
Commitment, Tranche A Term Loan Commitment (of the applicable Class) and/or
Tranche B Term Loan Commitment, as and to the extent applicable, (ii) with
respect to each Issuing Lender, its LOC Commitment and (iii) with respect to the
Swingline Lender, the Swingline Commitment, in each case as set forth on
Schedule 1.01A or in the applicable Assignment and Assumption Agreement as its
--------------
Commitment of the applicable Type, as any such amount may be increased or
decreased from time to time pursuant to this Agreement.
"Commitment Fee" has the meaning set forth in Section 3.05(a).
-------------- ---------------
"Commitment Letter" means the American Seafoods Group LLC Commitment
-----------------
Letter - $390,000,000 Senior Credit Facilities dated as of March 7, 2002 among
the Administrative Agent, Bank of America Securities LLC, as Lead Arranger, and
the Credit Parties.
"Company Properties" has the meaning set forth in Section 5.16.
------------------ ------------
"Condemnation" means any taking of property or assets, or any part
------------
thereof or interest therein, for public or quasi-public use under the power of
eminent domain, by reason of any public improvement or condemnation or in any
other manner.
"Condemnation Award" means all proceeds of any Condemnation or
------------------
transfer in lieu thereof.
"Consolidated Adjusted Working Capital" means at any date the excess
-------------------------------------
of (i) Consolidated Current Assets (excluding cash and Cash Equivalents and
unrealized gains on derivatives) over (ii) Consolidated Current Liabilities
(excluding the current portion of any Consolidated Funded Debt and unrealized
losses on derivatives).
"Consolidated Capital Expenditures" means for any period the aggregate
---------------------------------
amount of all expenditures (whether paid in cash or other consideration or
accrued as a liability) that would, in accordance with GAAP, be included as
additions to property, plant and equipment and other capital
8
expenditures of the Borrower and its Consolidated Subsidiaries for such period,
as the same are or would be set forth in a consolidated statement of cash flows
of the Borrower and its Consolidated Subsidiaries for such period (including the
amount of assets leased under any Capital Lease), but excluding (to the extent
that they would otherwise be included) (i) any such expenditures made for the
replacement or restoration of assets to the extent paid for by any Casualty
Insurance Policy or Condemnation Award with respect to the asset or assets being
replaced or restored to the extent such expenditures are permitted under the
Credit Documents and (ii) for purposes of Section 7.14 and the definition of
------------
"Fixed Charge Coverage Ratio" only, capital expenditures for Permitted
Acquisitions.
"Consolidated Cash Dividends" means for any period the aggregate
---------------------------
amount of all Restricted Payments paid in cash by the Borrower or by any
Subsidiary of the Borrower to any Person other than the Borrower or a
Wholly-Owned Consolidated Subsidiary of the Borrower during such period (other
than Restricted Payments made pursuant to Section 7.07(v)).
----------------
"Consolidated Cash Taxes" means for any period the aggregate amount of
-----------------------
(i) all income, value added and franchise taxes of the Borrower and its
Consolidated Subsidiaries for such period to the extent the same are paid in
cash by the Borrower or any Consolidated Subsidiary of the Borrower during such
period and (ii) the amount of Permitted Tax Dividends paid by the Borrower in
cash in respect of such period.
"Consolidated Current Assets" means at any date the consolidated
---------------------------
current assets of the Borrower and its Consolidated Subsidiaries determined as
of such date.
"Consolidated Current Liabilities" means at any date (i) the
--------------------------------
consolidated current liabilities of the Borrower and its Consolidated
Subsidiaries, less current liabilities related to currency forward contracts,
plus (ii) all Guaranty Obligations of the Borrower or any Consolidated
Subsidiary of the Borrower in respect of the current liabilities of any Person
(other than the Borrower or a Consolidated Subsidiary of the Borrower), all
determined as of such date.
"Consolidated EBITDA" means for any period the sum of (i) Consolidated
-------------------
Net Income for such period plus (ii) an amount which, in the determination of
Consolidated Net Income for such period, has been deducted for (A) Consolidated
Interest Expense, (B) provisions for Federal, state, local and foreign income,
value added and similar taxes, (C) depreciation and amortization expense, (D)
unrealized foreign exchange losses recognized in accordance with Statement of
Financial Accounting Standards No. 133, (E) other non-cash charges or non-cash
losses, including but not limited to, non-cash deductions in respect of minority
interests, and (F) any financial advisory fees, accounting fees, legal fees, and
other similar advisory and consulting fees and related out-of-pocket expenses of
the Borrower incurred and deducted from net income during the nine-month period
ending April 30, 2002 as a result of the Recapitalization (provided that the
foregoing amounts referred to in this clause (F) shall not exceed $3,000,000 in
----------
the aggregate) plus (iii) all cash payments received during such period on
----
account of non-cash income or non-cash gains in a prior period minus (iv) all
-----
cash payments made during such period on account of non-cash charges expensed in
a prior period minus (v) an amount which, in the determination of Consolidated
-----
Net Income for such period, has been added for (A) interest income, (B)
unrealized foreign exchange gains recognized in accordance with Statement of
Financial Accounting Standards No. 133 and (C) any non-cash income or non-cash
gains, all as determined in accordance with GAAP.
"Consolidated Fixed Charges" means, for any period, the sum of (i)
--------------------------
Consolidated Interest Expense (exclusive of the non-cash portion of Consolidated
Interest Expense, if any, which is treated as interest expense in accordance
with GAAP and is attributable to (A) the unamortized portion of debt issuance
costs incurred in connection with the Original Credit Agreement as of the
Effective Date or (B) the amortization of debt issuance costs arising from the
Loans or the issuance of the Senior Subordinated
9
Notes) for such period plus (ii) Consolidated Scheduled Debt Payments for such
period plus (iii) Consolidated Cash Dividends (exclusive of Permitted Tax
Dividends) for such period.
"Consolidated Funded Debt" means at any date the Funded Debt of the
------------------------
Borrower and its Consolidated Subsidiaries as of such date, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, the total
-----------------------------
interest expense, whether paid or accrued and whether or not capitalized,
(including, without limitation, amortization of debt issuance costs and original
issue discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments under
Capital Leases and the implied interest component of Synthetic Leases
(regardless of whether accounted for as an interest expense under GAAP), all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptances and net costs in respect of Derivative
Obligations constituting interest rate swaps, collars, caps or other
arrangements requiring payments contingent upon interest rates of the Borrower
and its Consolidated Subsidiaries, determined on a consolidated basis for such
period; provided that (i) all non-cash interest expense attributable to the
--------
Norway Notes shall be excluded and (ii) for any period prior to the date on
which less than four full fiscal quarters have elapsed since the Effective Date,
the amount of interest expense attributable to the Senior Subordinated Notes
shall be deemed to equal the amount of interest accrued or paid on the Senior
Subordinated Notes for the period elapsed from their date of issuance through
the most recent fiscal quarter ending on or preceding the date of determination,
annualized on a simple arithmetic basis.
"Consolidated Net Income" means, for any period, the net income (or
-----------------------
net loss) after taxes of the Borrower and its Consolidated Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP; provided
--------
that there shall be excluded from the calculation of Consolidated Net Income (i)
the income (or loss) of any Person which is not a Subsidiary of the Borrower or
which is accounted for by the equity method of accounting, except to the extent
that any such income is actually received by the Borrower or a Consolidated
Subsidiary of the Borrower in the form of Restricted Payments or other
distributions during such period, (ii) the income (or loss) of any Person
accrued prior to the date it becomes a Consolidated Subsidiary of the Borrower
or is merged with or into or consolidated with the Borrower or any of its
Consolidated Subsidiaries or that Person's assets are acquired by the Borrower
or any of its Consolidated Subsidiaries, except as provided in the definition of
"Pro-Forma Basis" herein and (iii) the income of any Subsidiary of the Borrower
to the extent that the declaration or payment of Restricted Payments or similar
distributions by that Subsidiary of that income is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary.
"Consolidated Parties" means the Parent, the Borrower and their
--------------------
respective Subsidiaries, and "Consolidated Party" means any one of them.
------------------
"Consolidated Scheduled Debt Payments" means, for any period, the sum
------------------------------------
of all scheduled payments of principal on Consolidated Funded Debt (including,
without limitation, the principal component of Capital Lease Obligations and
Synthetic Leases (regardless of whether accounted for as an indebtedness under
GAAP) paid or payable during such period), but excluding payments made on
Revolving Loans and Swingline Loans during such period; provided that
--------
Consolidated Scheduled Debt Payments shall not include voluntary prepayments of
Consolidated Funded Debt, mandatory prepayments of the Term Loans pursuant to
Section 3.03(b) or other mandatory prepayments (other than by virtue of
---------------
scheduled amortization) of Consolidated Funded Debt (but Consolidated Scheduled
Debt Payments for a period shall be adjusted to reflect the effect on scheduled
payments of principal for such period of the application of any mandatory
prepayments of Consolidated Funded Debt during or preceding such period).
10
"Consolidated Subsidiary" means with respect to any Person at any date
-----------------------
any Subsidiary of such Person or other entity the accounts of which would be
consolidated with those of such Person in its consolidated financial statements
if such statements were prepared as of such date in accordance with GAAP.
"Continuing Lender" means with respect to any event described in
-----------------
Section 3.04(d), a Lender which is neither a Retiring Lender nor a New Lender,
---------------
and "Continuing Lenders" means any two or more of such Continuing Lenders.
------------------
"Credit Documents" means this Agreement, the Notes, the Guaranties,
----------------
the Acknowledgment Agreement, the Collateral Documents, each Perfection
Certificate, the Indemnity, Subrogation and Contribution Agreement, the
Intercompany Notes, each Joinder Agreement and each LOC Document, collectively,
and all other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto, in each case as the same may be
amended, modified or supplemented from time to time.
"Credit Event" means a Borrowing or the issuance (including the deemed
------------
issuance on the Effective Date of Existing Letters of Credit continued as
Letters of Credit hereunder), renewal or extension of a Letter of Credit or the
purchase by a Lender of a Participation Interest.
"Credit Obligations" means, without duplication: (i) all principal of
------------------
and interest (including, without limitation, any interest which accrues after
the commencement of any Bankruptcy Event with respect to any Credit Party,
whether or not allowed or allowable as a claim under the Bankruptcy Code) on any
Loan or LOC Obligation under, or any Note issued pursuant to, this Agreement or
any other Credit Document; (ii) all fees, expenses, indemnification obligations
and other amounts of whatever nature now or hereafter payable by any Credit
Party (including, without limitation, any amounts which accrue after the
commencement of any Bankruptcy Event with respect to any Credit Party, whether
or not allowed or allowable as a claim under the Bankruptcy Code) pursuant to
this Agreement or any other Credit Document; (iii) all expenses of the Agents as
to which one or more of the Agents have a right to reimbursement under Section
-------
10.05(a) of this Agreement, under Section 7.03(a) or (b) of the Security
-------- --------------- ---
Agreement or under any other similar provision of any other Credit Document,
including, without limitation, any and all sums advanced by the Collateral Agent
to preserve the Collateral or preserve its security interests in the Collateral;
(iv) all amounts paid by any Indemnitee as to which such Indemnitee has the
right to reimbursement under Section 10.05(b) of this Agreement, under Section
---------------- -------
7.03(c) of the Security Agreement or under any other similar provision of any
-------
other Credit Document; and (v) in the case of each Guarantor, all amounts now or
hereafter payable by such Guarantor and all other obligations or liabilities now
existing or hereafter arising or incurred (including, without limitation, any
amounts which accrue after the commencement of any Bankruptcy Event with respect
to such Guarantor, whether or not allowed or allowable as a claim under the
Bankruptcy Code) on the part of such Guarantor pursuant to this Agreement, the
Guaranties or any other Credit Document; together in each case with all
renewals, modifications, consolidations or extensions thereof.
"Credit Party" means each of the Borrower and each Guarantor, and
------------
"Credit Parties" means any combination of the foregoing.
--------------
"Creditor" means each Lender, each Derivatives Creditor, each Agent
--------
and each Indemnitee and their respective successors and assigns, and "Creditors"
---------
means any two or more of such Creditors.
"Debt" of any Person means at any date, without duplication, (i) all
----
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or
11
other similar instruments, (iii) all obligations of such Person under
conditional sale or other title retention agreements relating to property
purchased by such Person to the extent of the value of such property (other than
customary reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (iv) all obligations, other
than intercompany items, of such Person to pay the deferred purchase price of
property or services (other than any such obligation incurred under ERISA and
trade accounts payable arising in the ordinary course of business and due within
six months of the incurrence thereof), (v) the principal portion of all
obligations of such Person under (A) Capital Leases and (B) Synthetic Leases
(regardless of whether accounted for as indebtedness under GAAP), (vi) all
obligations of such Person to purchase securities or other property which arise
out of or in connection with the sale of the same or substantially similar
securities or property, (vii) all non-contingent obligations (and, for purposes
of Section 7.01 and Section 8.01(f), all contingent obligations) of such Person
------------ ---------------
to reimburse any bank or other Person in respect of amounts paid under a letter
of credit, bankers' acceptance or similar instrument, (viii) all obligations of
others secured by (or for which the holder of such obligations has an existing
right, contingent or otherwise, to be secured by) a Lien on, or payable out of
the proceeds of production from, any property or asset of such Person, whether
or not such obligation is assumed by such Person; provided that the amount of
--------
any Debt of others that constitutes Debt of such Person solely by reason of this
clause (viii) shall not for purposes of this Agreement exceed the greater of the
-------------
book value or the fair market value of the properties or assets subject to such
Lien, (ix) all Guaranty Obligations of such Person, (x) all Disqualified Stock
of such Person and (xi) the Debt of any other Person (including any partnership
in which such Person is a general partner and any unincorporated joint venture
in which such Person is a joint venturer) to the extent such Person would be
liable therefor under applicable law or any agreement or instrument by virtue of
such Person's ownership interest in or other relationship with such entity,
except to the extent the terms of such Debt provide that such person shall not
be liable therefor.
"Debt Issuance" means the issuance by any Consolidated Party of any
-------------
Debt for borrowed money; provided that the foregoing shall not be deemed to
--------
imply that any such Debt Issuance is permitted under this Agreement.
"Default" means any condition or event which constitutes an Event of
-------
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Defaulting Lender" means at any time any Lender that, within one
-----------------
Business Day of the date when due, (i) has failed to make a Loan or purchase a
Participation Interest required pursuant to the terms of this Agreement, (ii)
other than as set forth in clause (i) above, has failed to pay to any Agent or
----------
any Lender an amount owed by such Lender pursuant to the terms of the Agreement
or any other Credit Document unless such amount is subject to a good faith
dispute or (iii) has been deemed insolvent or has become subject to a
bankruptcy, receivership or insolvency proceeding or to receiver, transfer or
similar official.
"Depositary Bank Agreement" means an agreement between a Credit Party
-------------------------
and any bank or other depositary institution, substantially in the form of
Exhibit D to the Security Agreement, as the same may be amended, modified or
---------
supplemented from time to time.
"Derivatives Agreement" means an agreement between a Credit Party and
---------------------
any Derivatives Creditor with respect to one or more Derivatives Obligations.
"Derivatives Creditor" means any Lender or any Affiliate of any Lender
--------------------
from time to time party to one or more Derivatives Agreements with a Credit
Party (even if any such Lender for any
12
reason ceases after the execution of such agreement to be a Lender hereunder),
and its successors and assigns, and "Derivatives Creditors" means any two or
---------------------
more of such Derivatives Creditors.
"Derivatives Obligations" of any Person means all obligations
-----------------------
(including, without limitation, any amounts which accrue after the commencement
of any case, proceeding or other Bankruptcy Event) of such Person in respect of
any rate swap transaction, basis swap, forward rate transaction, fuel or other
commodity swap, commodity option, equity or equity index swap, equity or equity
index option, bond option, interest rate option, foreign exchange transaction,
cap transaction, floor transaction, collar transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or any other
similar transaction (including any option with respect to any of the foregoing
transactions) or any combination of the foregoing transactions, excluding any
amounts which such Person is entitled to set-off against its obligations under
applicable law.
"Derivatives Termination Value" means, at any date and in respect of
-----------------------------
any one or more Derivatives Agreements, after taking into account the effect of
any legally enforceable netting agreements relating to such Derivatives
Agreements, (i) for any date on or after the date such Derivatives Agreements
have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (ii) for any date prior to the date
referenced in clause (i), the amount(s) determined as the ▇▇▇▇-to-market
value(s) for such Derivatives Agreements, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Derivatives Agreements (which may include any Lender).
"Disqualified Stock" of any Person means (i) any Capital Stock of such
------------------
Person which by its terms (or by the terms of any security for which it is
convertible or for which it is exchangeable or exercisable), or upon the
happening of any event or otherwise (including an event which would constitute a
Change of Control), (A) matures or is mandatorily redeemable or subject to any
mandatory repurchase requirement, pursuant to a sinking fund or otherwise, (B)
is convertible into or exchangeable for Debt or Disqualified Stock or (C) is
redeemable or subject to any repurchase requirement arising at the option of the
holder thereof, in whole or in part, on or prior to the first anniversary of the
Final Termination Date and (ii) if such Person is a Subsidiary of the Parent,
any Preferred Stock of such Person issued to any Person other than a
Wholly-Owned Domestic Consolidated Subsidiary of the Parent.
"Dollars" and the sign "$" means lawful money of the United States of
------- -
America.
"Domestic Subsidiary" means with respect to any Person each Subsidiary
-------------------
of such Person which is organized under the laws of the United States or any
territory thereof, and "Domestic Subsidiaries" means any two or more of them.
---------------------
"Effective Date" means the date this Agreement becomes effective in
--------------
accordance with Section 4.01.
------------
"Eligible Assignee" means (i) any Lender, (ii) any Affiliate or
-----------------
Subsidiary of a Lender or any fund (an "Approved Fund") that invests in bank
-------------
loans and is managed by a Lender, an Affiliate of a Lender or an investment
advisor to a Lender or by an Affiliate of such investment advisor and which, in
the case of an assignment of all or part of any Revolving Commitment pursuant to
Section 10.03(b) hereof to an Approved Fund, is approved by the Borrower (such
----------------
approval not to be unreasonably withheld or delayed by such Borrower and such
approval to be deemed given by the Borrower if no objection from the Borrower is
received by the assigning Lender and the Administrative Agent within five
Business Days after notice of such proposed assignment of such Revolving
Commitment to an Approved Fund has been provided by the assigning Lender to the
Borrower and no such approval shall be required if an Event of Default has
occurred and is continuing at the time any such assignment is effected pursuant
to
13
Section 10.03(b)), and (iii) any other commercial bank, financial institution or
----------------
"institutional accredited investor" (as defined in Regulation D under the
Securities Act) approved by the Administrative Agent and, unless an Event of
Default has occurred and is continuing at the time any assignment is effected
pursuant to Section 10.03(b), the Borrower, such approval not to be
----------------
unreasonably withheld or delayed by such Borrower and such approval to be deemed
given by such Borrower if no objection from such Borrower is received by the
assigning Lender and the Administrative Agent within five Business Days after
notice of such proposed assignment has been provided by the assigning Lender to
the Borrower; provided, however, that ASLP and its Affiliates and Subsidiaries
-------- -------
shall not qualify as Eligible Assignees.
"Environmental Claim" means any investigation, written notice,
-------------------
violation, written demand, written allegation, action, suit, injunction,
judgment, order, consent decree, penalty, fine, lien, proceeding or written
claim, whether administrative, judicial or private in nature, from activities or
events taking place during or prior to Holdings' or any of its Subsidiaries'
ownership or operation of any Real Property and arising (i) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental Law, (ii)
in connection with any Hazardous Substances, (iii) from any assessment,
abatement, removal, remedial, corrective, or other response action required by
an Environmental Law or (iv) from any actual or alleged damage, injury, threat,
or harm arising from environmental hazards (including Hazardous Substances) to
health, safety, natural resources, or the environment.
"Environmental Laws" means any current or future legal requirement of
------------------
any Governmental Authority applicable to any of the Consolidated Parties and
pertaining to (i) the protection of health, safety, and the environment from
environmental hazards (including Hazardous Substances), (ii) the conservation,
management, or use of natural resources and wildlife, (iii) the protection or
use of surface water and groundwater or (iv) the management, manufacture,
possession, presence, use, generation, transportation, treatment, storage,
disposal, release, threatened release, abatement, removal, remediation or
handling of, or exposure to, any hazardous or toxic substance or material and
includes, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 USC 9601 et seq., Solid
Waste Disposal Act, as amended, 42 USC 6901 et seq., Federal Water Pollution
Control Act, as amended, 33 USC 1251 et seq., Clean Air Act, as amended, 42 USC
7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601 et seq.,
Hazardous Materials Transportation Act, 49 USC App. 1801 et seq., Occupational
Safety and Health Act of 1970, as amended, 29 USC 651 et seq., Oil Pollution Act
of 1990, 33 USC 2701 et seq., Emergency Planning and Community Right-to-Know Act
of 1986, 42 USC 11001 et seq., National Environmental Policy Act of 1969, 42 USC
4321 et seq., Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et
seq., any analogous implementing or successor law, and any amendment, rule,
regulation, order, or directive issued thereunder.
"Equity Distribution" means the distribution of cash on the Effective
-------------------
Date (i) by the Borrower to the Parent, (ii) by the Parent to Holdings, (iii) by
Holdings to ASLP, two Affiliates of the Sponsor, ▇▇▇▇▇ ▇▇▇▇▇ and Webjorn Eikrem
and (iv) by ASLP to or for the benefit of its partners, in each case in
connection with the Transaction.
"Equity Equivalents" means with respect to any Person any rights,
------------------
warrants, options, convertible securities, exchangeable securities, indebtedness
or other rights, in each case exercisable for or convertible or exchangeable
into, directly or indirectly, Capital Stock or other equity or equivalent
interests of such Person or securities exercisable for or convertible or
exchangeable into Capital Stock or other equity or equivalent interests of such
Person, whether at the time of issuance or upon the passage of time or the
occurrence of some future event.
"Equity Issuance" means (i) any sale or issuance by any Consolidated
---------------
Party to any Person other than the Borrower or a Wholly-Owned Consolidated
Subsidiary of the Borrower of any shares of its
14
Capital Stock or any Equity Equivalents (other than any such Equity Equivalents
that constitute Debt) and (ii) the receipt by any Consolidated Party of any cash
capital contributions, whether or not paid in connection with any issuance of
Capital Stock of any Consolidated Party, from any Person other than the Borrower
or a Subsidiary of the Borrower.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, or any successor statute, as interpreted by the rules and regulations
thereunder, all as the same may be in effect from time to time. References to
sections of ERISA shall be construed also to refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not incorporated, which
---------------
is under common control with any Consolidated Party within the meaning of
Section 4001(a)(14) of ERISA, or is a member of a group which includes any
Consolidated Party and which is treated as a single employer under Section
414(b), (c), (m) or (o) of the Code.
"ERISA Event" means (i) with respect to any Single Employer Plan, the
-----------
occurrence of a Reportable Event or the substantial cessation of operations
(within the meaning of Section 4062(e) of ERISA), (ii) the withdrawal of any
Consolidated Party or any ERISA Affiliate from a Multiple Employer Plan during a
plan year in which it was a substantial employer (as such term is defined in
Section 4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan,
(iii) the distribution of a notice of intent to terminate or the actual
termination of a Single Employer Plan pursuant to Section 4041(a)(2) or 4041A of
ERISA, (iv) the institution of proceedings to terminate or the actual
termination of a Single Employer Plan by the PBGC under Section 4042 of ERISA,
(v) any event or condition which might reasonably constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Single Employer Plan, (vi) the complete or partial withdrawal of
Holdings or any of its Subsidiaries or any ERISA Affiliate from a Multiemployer
Plan, (vii) the conditions for imposition of a lien under Section 302(f) of
ERISA exist with respect to any Single Employer Plan or (viii) the adoption of
an amendment to any Single Employer Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.
"Eurodollar Lending Office" means, as to each Lender, its office,
-------------------------
branch or Affiliate or Subsidiary located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative Questionnaire
as its Eurodollar Lending Office) or such other office, branch or Affiliate or
Subsidiary of such Lender as it may hereafter designate as its Eurodollar
Lending Office by notice to the Borrower and the Administrative Agent.
"Eurodollar Loan" means at any date a Loan which bears interest at a
---------------
rate determined by reference to a Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
---------------
Loan comprising the same Group, the quotient obtained (rounded upward, if
necessary, to the next higher 1/100th of 1%) by dividing (i) the applicable
London Interbank Offered Rate for such Interest Period by (ii) 1.00 minus the
Eurodollar Reserve Percentage.
"Eurodollar Reserve Percentage" means for any day that percentage
-----------------------------
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any other entity succeeding
to the functions currently performed thereby) for determining the maximum
reserve requirement for a member bank of the Federal Reserve System in New York
City with deposits exceeding five billion Dollars in respect of "Eurocurrency
liabilities" (or in respect of any other category of liabilities which includes
deposits by reference to which the interest rate on Eurodollar Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United
15
States office of any Lender to United States residents), whether or not a Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities
and as such shall be deemed subject to reserve requirements without benefits of
credits for prorations, exceptions or offsets that may be available from time to
time to a Lender. The Eurodollar Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurodollar Reserve Percentage.
"Event of Default" has the meaning set forth in Section 8.01.
---------------- ------------
"Excess Cash Flow" means for any period an amount equal to (i)
----------------
Consolidated EBITDA for such period plus (ii) extraordinary cash income, if any,
business interruption insurance proceeds, if any, and cash gains attributable to
Asset Dispositions out of the ordinary course of business, if any, of the
Borrower and its Consolidated Subsidiaries during such period to the extent not
included in Consolidated EBITDA for such period and not required to be utilized
in connection with a repayment or prepayment of the Loans made or to be made
pursuant to Section 3.03(b)(iii) or reinvested pursuant to the terms hereof,
--------------------
plus (iii) the amount, if any, by which Consolidated Adjusted Working Capital
decreased during such period, minus (iv) Consolidated Capital Expenditures for
such period paid in cash (and not with the proceeds of Debt), minus (v)
Consolidated Interest Expense paid in cash by the Borrower and its Consolidated
Subsidiaries during such period, minus (vi) Consolidated Cash Taxes (including
Permitted Tax Dividends) for such period, minus (vii) Consolidated Scheduled
Debt Payments for such period, minus (viii) optional prepayments of the Term
Loans during such period, minus (ix) to the extent not included in clause (iii)
------------
above, repayments or prepayments of the Revolving Loans and Swingline Loans to
the extent the Revolving Commitments and the Swingline Commitment are
permanently reduced at the time of such payment and minus (x) the amount, if
any, by which Consolidated Adjusted Working Capital increased during such
period, it being understood that for purposes of clauses (vii), (viii) and (ix)
------------- ------ ----
above, any such payments, prepayments and/or commitment reductions effected
during calendar year 2002 prior to the Effective Date under the Original Credit
Agreement shall be treated in the same manner as payments, prepayments and
commitment reductions under this Agreement effected after the Effective Date and
not made with proceeds of any Loans or Senior Subordinated Notes. Repayments and
prepayments of the Term Loans pursuant to Section 3.03(b) (including any such
---------------
repayments or prepayments made prior to the Effective Date under Section 3.03(b)
of the Original Credit Agreement) shall not be included in clauses (vii) and
-------------
(viii) of this definition.
------
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations promulgated thereunder.
"Excluded Asset Disposition" means: (i) any Asset Disposition by any
--------------------------
Consolidated Party to the Borrower or any of the Subsidiary Guarantors if (A)
the Credit Parties shall cause to be executed and delivered such documents,
instruments and certificates as the Administrative Agent or the Collateral Agent
may request so as to cause the Credit Parties to be in compliance with the terms
of Section 6.11 after giving effect to such Asset Disposition and (B) after
------------
giving effect to such Asset Disposition, no Default or Event of Default exists;
(ii) the sale or lease of inventory in the ordinary course of business; (iii)
the liquidation or sale of Cash Equivalents for the account of the Borrower and
its Subsidiaries; (iv) the sale, lease, transfer, assignment or other
disposition of assets (other than in connection with any Casualty or
Condemnation) of the Borrower or any of its Subsidiaries to any other Person to
the extent that the aggregate Net Cash Proceeds from such sale, lease, transfer,
assignment or other disposition when combined with all other such dispositions
previously made during such fiscal year, does not exceed $1,000,000 in the
aggregate; (v) the disposition of machinery, equipment or other operating assets
of the Borrower or any of its Subsidiaries which will be replaced or upgraded
with machinery or equipment or other operating assets owned by such Person;
provided that (A) such replacement or upgraded machinery, equipment or other
--------
operating assets is acquired within 180 days after
16
such disposition, (B) the fair market value of all property constituting an
"Excluded Asset Disposition" by virtue of this clause (v) does not exceed
----------
$5,000,000 in the aggregate in any fiscal year of the Borrower and (C) upon
their acquisition, such replacement assets become subject to the Lien of the
Collateral Agent under the Collateral Documents; (vi) the disposition of
obsolete, worn-out or surplus tangible assets in the ordinary course of business
and in a commercially reasonable manner, so long as the fair market value of all
property contributing an "Excluded Asset Disposition" by virtue of this clause
------
(vi) does not exceed $1,000,000 in the aggregate in any fiscal year of the
----
Borrower; (vii) any sale or issuance by a Subsidiary of the Borrower of
directors' qualifying shares and Capital Stock of Foreign Subsidiaries of the
Borrower to the extent that the aggregate Net Cash Proceeds therefrom during any
fiscal year of the Borrower do not exceed $100,000 and (viii) any Permitted
Vessel Lease, to the extent the charter or other payments received in respect
thereof are included in the Consolidated Net Income of the Borrower and its
Subsidiaries.
"Excluded Debt Issuance" means the incurrence of Debt by the Borrower
----------------------
or any of its Subsidiaries permitted under Section 7.01(i), (ii), (iii),
--------------- ---- -----
(iv), (v), (vi), (vii), (viii), (ix), (x) and (xi) in each case as in effect on
---- --- ---- ----- ------ ---- --- ----
the date hereof.
"Excluded Equity Issuance" means (i) any issuance by any Subsidiary of
------------------------
the Borrower of its Capital Stock to the Borrower or any other Wholly-Owned
Domestic Subsidiary of the Borrower, (ii) the receipt by any Wholly-Owned
Subsidiary of the Borrower of a capital contribution from the Borrower or a
Subsidiary of the Borrower, (iii) any issuance by a Subsidiary of the Borrower
that is not a Wholly-Owned Subsidiary of its Capital Stock to a Person other
than the Borrower or a Wholly-Owned Subsidiary simultaneously with a pro-rata
issuance of its Capital Stock to the Borrower or a Wholly-Owned Subsidiary and
(iv) any Qualifying Equity Issuance.
"Excluded Taxes" has the meaning set forth in Section 3.10(a).
-------------- ---------------
"Existing Debt" has the meaning set forth in Section 7.01(a)(i).
------------- ------------------
"Existing Debt Agreements" means all agreements evidencing or relating
------------------------
to debt of any Consolidated Party which is to remain outstanding after giving
effect to the Credit Events to occur on the Effective Date and the consummation
of the Recapitalization and the other transactions contemplated by the
Transaction Documents.
"Existing Letters of Credit" means letters of credit issued before the
--------------------------
Effective Date pursuant to the Original Credit Agreement and described by date
of issuance, letter of credit number, undrawn amount, name of beneficiary and
date of expiry on Schedule 1.01F hereto, and "Existing Letter of Credit" means
-------------- -------------------------
any one of them.
"Existing Lenders" has the meaning set forth in the introductory
----------------
paragraphs to this Agreement.
"Failed Loan" has the meaning set forth in Section 3.14(d).
----------- ---------------
"Federal Funds Rate" means for any day the rate per annum (rounded
------------------
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day; provided that (i) if such day is not a Business Day, the
--------
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (ii) if no such rate is so published on such next succeeding Business Day,
the Federal
17
Funds Rate for such day shall be the average rate quoted to Bank of America,
N.A. on such day on such transactions as determined by the Administrative Agent.
"Fee Letter" means the American Seafoods Group LLC Fee Letter -
----------
$390,000,000 Senior Credit Facilities dated as of March 7, 2002 among the
Administrative Agent, Banc of America Securities LLC, as Lead Arranger, and the
Credit Parties.
"Final Termination Date" means the latest of the Revolving Termination
----------------------
Date, the Tranche A Term Loan Maturity Date and the Tranche B Term Loan Maturity
Date.
"Fishing Rights" means all fishing and fish processing history and
--------------
rights, endorsements, licenses, approvals, quotas, permits, entitlements and
privileges of whatever nature owned, awarded to, purchased, received, or
otherwise acquired or used, heretofore or hereafter, by or with respect to a
Vessel or any of the Appurtenances thereto or by the Borrower or any of its
Subsidiaries in any way related or attributable to a Vessel or any of the
Appurtenances thereto or its operations (including its catch and operating
history). Such rights include without limitation any rights which presently
exist or which may be hereafter established under any fishery moratorium,
cooperative, limited entry system, license limitation system, individual
transferable quota or fishery quota program or other fishery management program
and any present or future fishing quota, quota share, fishing privilege or other
similar fishing or fish processing right, regardless of the name for such quota
or right and regardless of whether the right to receive such quota or right is
based on catch or processing history, vessel capacity, ownership structure,
community investment or other factors. Such rights also include any Fishing
Rights Agreements, or any other contractual or consensual rights relating to the
harvest or processing or any right to benefit in any way of any species of fish,
all cooperative agreements, privileges, certificates of eligibility and claims
under any buy-back or similar program, any eligibility to participate in any
fishery or designate a replacement vessel(s) under the AFA or under any other
statutory or regulatory scheme, any other vessel certification and/or any other
vessel or owner specific right to harvest, process or otherwise participate in
or benefit from any fishery in any way, whether existing now or created
hereafter.
"Fishing Rights Agreements" means (i) the Membership Agreement dated
-------------------------
May 23, 1997 by and among Alaska Ocean Seafood, Ltd., ASC, Glacier Fish Company,
Ltd. and Tyson Seafood Group, Inc. and ▇▇▇▇▇▇▇ Conservation Cooperative (d/b/a
Pacific ▇▇▇▇▇▇▇ Conservation Cooperative), (ii) the Membership Agreement dated
December 18, 1998 by and among Alaska Ocean Seafood, L.P., Alaska Trawl
Fisheries, Inc., ASC, Arctic Fjord, Inc., Arctic Storm, Inc., Glacier Fish
Company LLC, Highland Light Seafoods, L.L.C., Starbound Ltd. Partnership, Tyson
Foods, Inc. and ▇▇▇▇▇▇▇ Conservation Cooperative, (iii) the Membership Agreement
dated as of December 19, 1998 among Forum Star, Inc., ASC, Harvester
Enterprises, Inc., ▇▇▇▇ Milach, Inc., ▇▇▇▇▇ ▇▇▇▇, Inc., Neahkahnie Fisheries,
Inc. and Sea Storm, Inc., as Members, and Offshore ▇▇▇▇▇▇▇ Catcher Cooperative,
as the Cooperative, as amended by Amendment to Membership Agreement dated as of
January 14, 1999, in each case as amended through the Effective Date and (iv)
all other contracts or other agreements to which any Consolidated Party is a
party or the recipient that restrict, limit, condition, convey or allocate
Fishing Rights or related Approvals or Permits held or to be held by the
Borrower or any of its Subsidiaries, including, without limitation, all
agreements by or related to any fishing cooperative in which the Borrower or any
of its Subsidiaries is a member, or which permits the Borrower or any of its
Subsidiaries to exercise or use Fishing Rights originally granted to or held by
any other Person.
"Fixed Charge Coverage Ratio" means, for any period, the ratio of (i)
---------------------------
Consolidated EBITDA less the aggregate amount of Consolidated Capital
Expenditures for such period (exclusive of the portion thereof financed with
Debt permitted by Section 7.01 incurred during such period) and less the
------------
aggregate amount of Consolidated Cash Taxes (including Permitted Tax Dividends)
for such period to (ii) Consolidated Fixed Charges for such period.
18
"Foreign Ownership Percentage" means, at any date with respect to any
----------------------------
Person, the percentage of the interest in such Person, at each tier of ownership
of such Person and in the aggregate, that is owned and controlled (determined in
accordance with the standards of Section 12102(c)(1) and (2) of Title 46 of the
United States Code (as amended by the AFA) and any regulations thereunder or
relevant thereto, all as effective on or after October 1, 2001, or as determined
under any analogous provisions of any successor statutes or regulations) by
Foreign Persons.
"Foreign Person" means, at any date, a Person that would not be
--------------
eligible to own a vessel with a fisheries endorsement under the standards of
subsections 12102(a) and 12102(c)(1) and (2) of Title 46 of the United States
Code (as amended by the AFA) and any regulations thereunder or relevant thereto,
all as effective on or after October 1, 2001, or under any analogous provisions
of any successor statutes or regulations.
"Foreign Subsidiary" means with respect to any Person any Subsidiary
------------------
of such Person that is not a Domestic Subsidiary of such Person.
"Funded Debt" means with respect to any Person and without duplication
-----------
(i) all Debt of such Person of the types referred to in clauses (i), (ii),
----------- ----
(iii), (iv), (v), (vi) and (vii) of the definition of "Debt" in this Section
----- ---- --- ---- ----- -------
1.01, (ii) all Debt of others of the type referred to in clause (i) above
---- ----------
secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) a Lien on, or payable out of the
proceeds of production from, any property or asset of such Person, whether or
not the obligations secured thereby have been assumed by such Person, provided
--------
that the amount of any Debt of others that constitutes Funded Debt of such
Person solely by reason of this clause (ii) shall not exceed the greater of the
-----------
book value or the fair market value of the properties or assets subject to such
Lien, (iii) all Guaranty Obligations of such Person with respect to Debt of
others of the type referred to in clause (i) above and (iv) all Debt of the type
----------
referred to in clause (i) above of any other Person (including any Partnership
----------
in which such Person is a general partner and any unincorporated joint venture
in which such Person is a joint venturer) to the extent such Person would be
liable therefor under any applicable law or any agreement or instrument by
virtue of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Debt provide that such Person
shall not be liable therefor.
"GAAP" means at any time generally accepted accounting principles as
----
then in effect in the United States, applied on a basis consistent (except for
changes with which the Borrower's independent public accountants have concurred)
with the pro-forma consolidated financial statements of the Borrower and its
Consolidated Subsidiaries pursuant to Section 4.01(c)(iv) delivered to the
-------------------
Lenders on the Effective Date.
"Governmental Authority" means any federal, state, local, provincial
----------------------
or foreign government, authority, agency, central bank, quasi-governmental or
regulatory authority, court or other body or entity, and any arbitrator with
authority to bind a party at law.
"Group of Loans" means at any time a group of Loans consisting of (i)
--------------
all Loans which are Base Rate Loans at such time or (ii) all Loans which are
Eurodollar Loans having the same Interest Period at such time; provided that, if
--------
a Loan of any particular Lender is converted to or made as a Base Rate Loan
pursuant to Section 3.06, 3.08 or 3.09, such Loan shall be included in the same
------------ ---- ----
Group or Group of Loans from time to time as it would have been had it not been
so converted or made.
"Guarantors" means the Parent Guarantors and the Subsidiary
----------
Guarantors, individually and collectively.
19
"Guaranty" means the Parent Guaranty Agreement or the Subsidiary
--------
Guaranty Agreement, and "Guaranties" means both of them, collectively.
----------
"Guaranty Obligation" means, with respect to any Person, without
-------------------
duplication, any obligations (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing or
intended to guarantee any Debt of any other Person in any manner, whether direct
or indirect, and including without limitation any obligation, whether or not
contingent, (i) to purchase any such Debt or other obligation or any property
constituting security therefor, (ii) to advance or provide funds or other
support for the payment or purchase of such indebtedness or obligation or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including, without limitation, maintenance agreements, comfort
letters, take or pay arrangements, put agreements or similar agreements or
arrangements) for the benefit of the holder of Debt of such other Person, (iii)
to lease or purchase property, securities or services primarily for the purpose
of assuring the owner of such Debt or (iv) to otherwise assure or hold harmless
the owner of such Debt or obligation against loss in respect thereof. The amount
of any Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Debt in respect of which such
Guaranty Obligation is made.
"Hazardous Substances" means any chemical, material or substance
--------------------
defined as or included in the definition of "hazardous substances", "hazardous
wastes", "hazardous materials", "extremely hazardous waste", "acutely hazardous
waste", "radioactive waste", "biohazardous waste", "pollutant", "toxic
pollutant", "contaminant", "restricted hazardous waste", "infectious waste",
"toxic substances", or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment under any applicable Environmental Laws, exposure
to which is prohibited, limited or regulated by any Governmental Authority or
which may or could pose a hazard to the health and safety of the owners,
occupants or any Persons in the vicinity of any facility or to the indoor or
outdoor environment, including, without limitation, petroleum and petroleum
by-products, asbestos containing materials and polychlorinated biphenyls.
"Holdings" means American Seafoods Holdings LLC, a Delaware limited
--------
liability company, and its successors.
"Holdings Norway Note" means the Senior Subordinated Promissory Note
--------------------
in the original principal amount of $45,000,000 issued by Holdings in favor of
Norway on January 28, 2000.
"Indemnitee" has the meaning set forth in Section 10.05(b).
---------- ----------------
"Indemnity, Subrogation and Contribution Agreement" means the
-------------------------------------------------
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit J hereto, dated as of the date hereof, among the Subsidiary Guarantors
---------
and the Administrative Agent, as amended, modified, restated or supplemented
from time to time.
"Insurance Proceeds" means all insurance proceeds (other than business
------------------
interruption insurance proceeds), damages, awards, claims and rights of action
with respect to any Casualty.
"Intellectual Property" has the meaning set forth in Section 5.17.
--------------------- ------------
"Intercompany Note" means a promissory note contemplated by Sections
----------------- --------
7.06(a)(xi), (xii) and (xiii), substantially in the form of Exhibit G hereto,
----------- ----- ------ ---------
and "Intercompany Notes" means any two or more of them.
------------------
20
"Interest Coverage Ratio" means as of the last day of any fiscal
-----------------------
quarter the ratio of (i) Consolidated EBITDA for the four-fiscal quarter period
then ended to (ii) Consolidated Interest Expense (exclusive of the non-cash
portion of Consolidated Interest Expense, if any, which is treated as interest
expense in accordance with GAAP and is attributable to (A) the unamortized
portion of debt issuance costs incurred in connection with the Original Credit
Agreement as of the Effective Date or (B) the amortization of debt issuance
costs arising from the Loans or the issuance of the Senior Subordinated Notes)
for such four-fiscal quarter period.
"Interest Payment Date" means (i) as to Base Rate Loans, the last day
---------------------
of each fiscal quarter of the Borrower and the Maturity Date for Loans of the
applicable Type and (ii) as to Eurodollar Loans, the last day of each applicable
Interest Period and the Maturity Date for Loans of the applicable Type, and in
addition where the applicable Interest Period for a Eurodollar Loan is greater
than three months, then also the date three months from the beginning of the
Interest Period and each three months thereafter.
"Interest Period" means with respect to each Eurodollar Loan, a period
---------------
commencing on the date of borrowing specified in the applicable Notice of
Borrowing or on the date specified in the applicable Notice of
Extension/Conversion and ending one, two, three, six or subject to availability
of matching funding deposits to all Lenders participating therein, nine or
twelve months thereafter, as the Borrower may elect in the applicable notice;
provided that: (i) any Interest Period which would otherwise end on a day which
--------
is not a Business Day shall, subject to clauses (iii) and (iv) below, be
------------- ----
extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next
preceding Business Day; (ii) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (iii) below, end on the last Business Day of a calendar
------------
month; (iii) with regard to the Tranche A Term Loans, no Interest Period shall
extend beyond any Principal Amortization Payment Date therefor unless the
Tranche A Term Loans comprised of Base Rate Loans together with the Tranche A
Term Loans comprised of Eurodollar Loans with Interest Periods expiring prior to
the date such Principal Amortization Payment is due, are at least equal to the
amount of such Principal Amortization Payment due on such date; (iv) with regard
to the Tranche B Term Loans, no Interest Period shall extend beyond any
Principal Amortization Payment Date therefor unless the Tranche B Term Loans
comprised of Base Rate Loans together with the Tranche B Term Loans comprised of
Eurodollar Loans with Interest Periods expiring prior to the date such Principal
Amortization Payment is due, are at least equal to the amount of such Principal
Amortization Payment due on such date; (v) no Interest Period may be elected at
any time when a Default or an Event of Default is then in existence; and (vi) no
Interest Period shall be elected which would end after the Maturity Date.
"Investment" in any Person means (i) the acquisition (whether for
----------
cash, property, services, assumption of Debt, securities or otherwise) of
assets, shares of Capital Stock, bonds, notes, debentures, time deposits or
other securities of such other Person, (ii) any deposit with, or advance, loan
or other extension of credit to, such Person (other than deposits made in
connection with the purchase of equipment or inventory in the ordinary course of
business) or (iii) any other capital contribution to or investment in such
Person, including by way of Guaranty Obligations of any obligation of such
Person, any support for a letter of credit issued on behalf of such Person
incurred for the benefit of such Person or in the case of any Subsidiary of the
Borrower, any release, cancellation, compromise or forgiveness in whole or in
part of any Debt owing by such Person. The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto, without
any adjustments for increases or decreases in value, write-ups, write-downs or
write-offs with respect to such Investment.
21
"Issuing Lender" means (i) Bank of America, N.A., in its capacity as
--------------
issuer of Letters of Credit under Section 2.02(b), and its successor or
--------------
successors in such capacity and (ii) any other Lender which the Borrower shall
have designated as an "Issuing Lender" by notice to the Administrative Agent.
"Joinder Agreement" means a Joinder Agreement, substantially in the
-----------------
form of Exhibit I hereto, executed and delivered by an Additional Subsidiary
---------
Guarantor after the Effective Date in accordance with Section 6.11(a).
---------------
"Joint Venture Entity" has the meaning set forth in Section
-------------------- -------
7.06(a)(xv).
----------
"Leaseholds" means with respect to any Person all of the right, title
----------
and interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"Lender" means each bank or other lending institution listed on
------
Schedule 1.01A as having a Commitment, each Eligible Assignee that becomes a
--------------
Lender pursuant to Section 10.03(b) and their respective successors and shall
---------------
include, as the context may require, each Issuing Lender in such capacity.
"Letter of Credit" means any letter of credit issued hereunder by an
----------------
Issuing Lender on or after the Effective Date and, on and after the Effective
Date, shall also include each Existing Letter of Credit.
"Letter of Credit Request" has the meaning set forth in Section
------------------------ -------
2.02(b).
-------
"Leverage Ratio" means on any date the ratio of (i) Consolidated
--------------
Funded Debt as of such date to (ii) Consolidated EBITDA for the period of four
consecutive fiscal quarters of the Borrower ending on, or most recently
preceding, such date.
"Lien" means any claim, charge, easement, lease, restrictive covenant,
----
security interest, mortgage, lien, option, pledge, rights of others, liability
to be forfeited, defeasance of title, charter parties, fishing or processing
arrangement, contract of affreightment, other right to the possession or
services of the property, restriction (whether on voting, sale, transfer,
disposition or otherwise) or other encumbrance whatsoever, whether imposed by
agreement, understanding, law, equity or otherwise, except for any restrictions
on transfer generally arising under any applicable federal or state securities
law. For the purposes of this Agreement, a Consolidated Party shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease, Synthetic Lease or other title retention agreement relating to such
asset.
"Loan" means a Revolving Loan, a Tranche A Term Loan, a Tranche B Term
----
Loan or a Swingline Loan, individually or collectively, as appropriate.
"LOC Cash Collateral Account" has the meaning set forth in the
---------------------------
Security Agreement.
"LOC Commitment" means the commitment of an Issuing Lender to issue
--------------
Letters of Credit in an aggregate face amount at any one time outstanding
(together with the amounts of any unreimbursed drawings thereon) of up to the
LOC Committed Amount.
"LOC Committed Amount" has the meaning set forth in Section 2.02(a).
-------------------- ---------------
"LOC Documents" means, with respect to any Letter of Credit, such
-------------
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor and any
22
agreements, instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or providing
for (i) the rights and obligations of the parties concerned or at risk or (ii)
any collateral security for such obligations.
"LOC Obligations" means at any time, the sum of (i) the maximum amount
---------------
which is, or at any time thereafter may become, available to be drawn under
Letters of Credit then outstanding, assuming compliance with all requirements
for drawings referred to in such Letters of Credit plus (ii) the aggregate
amount of all obligations of the Borrower or any Subsidiary to reimburse the
Issuing Lenders pursuant to Section 2.02(d) for amounts paid by any Issuing
--------------
Lender in respect of drawings under Letters of Credit, including any portion of
any such obligation to which a Lender has become subrogated pursuant to Section
-------
2.02(d).
------
"LOC Participant" means at any date a Lender which has a Revolving
---------------
Loan Commitment Percentage greater than $0, and "LOC Participants" means any two
----------------
or more of them, collectively.
"London Interbank Offered Rate" means, for any Eurodollar Loan for the
-----------------------------
Interest Period applicable thereto, the rate for deposits in Dollars for a
period of time comparable to such Interest Period which appears on Telerate Page
3750 (or any successor page) as the London interbank offered rate for deposits
in Dollars at approximately 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period; provided, however, if more than one rate
-------- -------
is specified on Telerate Page 3750, the applicable rate shall be the arithmetic
mean of all such rates. If for any reason such rate is not available, the term
"London Interbank Offered Rate" means for any Eurodollar Loan for any Interest
Period applicable thereto, the rate per annum appearing on Reuters Screen LIBO
Page as the London Interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period for a period of time comparable to such Interest Period;
provided, however, that if more than one such rate is specified on Reuters
-------- -------
Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such
rates (rounded upwards, if necessary, to the nearest 1/100 of 1%).
"Management Group" means the Persons identified on Schedule 1.01D,
---------------- --------------
all other current and future executive officers and members of senior management
of the Borrower and its Subsidiaries.
"Mandatory LOC Borrowing" has the meaning set forth in Section
----------------------- -------
2.02(e).
------
"Mandatory Swingline Borrowing" has the meaning set forth in Section
----------------------------- -------
2.05(c).
------
"Margin Stock" means "margin stock" as such term is defined in
------------
Regulation U.
"Material Adverse Effect" means (i) any material adverse effect upon
-----------------------
the condition (financial or otherwise), operations, properties, assets or
business of the Borrower and its Consolidated Subsidiaries taken as a whole,
(ii) a material adverse effect on the ability of the Credit Parties, taken as a
whole, to perform their obligations under this Agreement, the Notes and the
other Credit Documents or (iii) a material adverse effect on the rights and
remedies of the Administrative Agent, the Collateral Agent and Lenders under
this Agreement, the Notes and the other Credit Documents. In determining whether
any individual event or occurrence of the foregoing types would result in a
Material Adverse Effect, notwithstanding that a particular event or occurrence
does not itself have such effect, a Material Adverse Effect shall be deemed to
have occurred if the cumulative effect of such event or occurrence and all other
events or occurrences of the foregoing types which have occurred would result in
a Material Adverse Effect.
"Material Contracts" has the meaning set forth in Section 5.22.
------------------ ------------
23
"Material Intellectual Property" has the meaning set forth in Section
------------------------------ -------
5.17.
----
"Material Leased Property" means Real Property leased by any
------------------------
Consolidated Party for an annual rent of $100,000 or more; provided that, in any
--------
event, the term "Material Leased Property" shall not include (i) any leased Real
------------------------
Property with respect to which the Consolidated Party is unable, after using
commercially reasonable efforts, to procure the consent (if necessary under the
terms of the subject lease) to the Mortgage from the respective landlord, (ii)
any leased Real Property included on Schedule 5.20(a)(ii) hereof or (iii) any
--------------------
leased Real Property consisting solely of commercial office space.
"Material Licensed Intellectual Property" has the meaning set forth in
---------------------------------------
Section 5.17.
------------
"Material Owned Intellectual Property" has the meaning set forth in
------------------------------------
Section 5.17.
------------
"Maturity Date" means (i) as to Revolving Loans and Swingline Loans,
-------------
the Revolving Termination Date, (ii) as to the Tranche A Term Loans, the Tranche
A Term Loan Maturity Date and (iii) as to the Tranche B Term Loans, the Tranche
B Term Loan Maturity Date.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., a Delaware
-------
corporation, and its successors or, absent any such successor, such nationally
recognized statistical rating organization as the Borrower and the
Administrative Agent may select.
"Mortgage" means a mortgage or deed of trust, substantially in the
--------
form of, or otherwise substantially identical in substance to, the provisions of
Exhibit F-5 hereto, among any Credit Party, the Collateral Agent and one or more
-----------
trustees, as the same may be amended, modified or supplemented from time to
time.
"Mortgage Documents" means the documents and instruments required to
------------------
be delivered pursuant to the second sentence of Section 6.11(b).
"Mortgaged Properties" means, collectively, those parcels of Real
--------------------
Property for which Mortgages have been delivered pursuant to this Agreement.
"Multiemployer Plan" means a Plan covered by Title IV of ERISA which
------------------
is a multiemployer plan as defined in Section 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan covered by Title IV of ERISA,
----------------------
other than a Multiemployer Plan, which any Consolidated Party or any ERISA
Affiliate and at least one employer other than any Consolidated Party or any
ERISA Affiliate are contributing sponsors.
"Net Cash Proceeds" means: (i) with respect to any Asset Disposition,
-----------------
(A) the gross amount of cash proceeds (including Insurance Proceeds and
Condemnation Awards in the case of any Casualty or Condemnation, except to the
extent and for so long as such Insurance Proceeds or Condemnation Awards
constitute Reinvestment Funds or unless such Insurance Proceeds or Condemnation
Awards are to be used for repair, restoration or replacement pursuant to plans
approved by the Administrative Agent) actually paid to or actually received by
any Consolidated Party in respect of such Asset Disposition (including any cash
proceeds received as income or other proceeds of any non-cash proceeds of any
Asset Disposition as and when received), less (B) the sum of (w) the amount, if
any, of all taxes paid or reasonably expected to be paid (or Permitted Tax
Dividends made or which are expected to be made with respect to income or gains
arising as a result of such Asset Disposition), and customary fees, brokerage
fees, commissions, costs and other expenses (other than those payable to any
Consolidated Party or Affiliates) that are incurred in connection with such
Asset Disposition and are
24
payable by the seller or the transferor of the assets or property to which such
Asset Disposition relates, but only to the extent not already deducted in
arriving at the amount referred to in clause (i) (A) above, (x) appropriate
--------------
amounts that must be set aside as a reserve in accordance with GAAP against any
liabilities associated with such Asset Disposition, (y) if applicable, the
amount of any Debt (including any premium or penalty) secured by a Permitted
Lien that has been repaid or refinanced in accordance with its terms with the
proceeds of such Asset Disposition and (z) any payments to be made by any
Consolidated Party as agreed between such Consolidated Party and the purchaser
of any assets subject to an Asset Disposition in connection therewith; and (ii)
with respect to any Equity Issuance or Debt Issuance, the gross amount of cash
proceeds paid to or received by any Consolidated Party in respect of such Equity
Issuance or Debt Issuance as the case may be (including cash proceeds
subsequently received at any time in respect of such Equity Issuance or Debt
Issuance from non-cash consideration initially received or otherwise), net of
underwriting discounts and commissions or placement fees, investment banking
fees, legal fees, consulting fees, accounting fees and other customary fees and
expenses directly incurred by any Consolidated Party in connection therewith
(other than those payable to any Consolidated Party or any Affiliate of any
Consolidated Party).
"New Lender" means with respect to any event described in Section
---------- -------
3.04(d), an Eligible Assignee which becomes a Lender hereunder as a result of
-------
such event, and "New Lenders" means any two or more of such New Lenders.
-----------
"Non-Excluded Taxes" has the meaning set forth in Section 3.10.
------------------ ------------
"Norway" means Norway Seafoods ASA, a Norwegian corporation, and its
------
successors and Affiliates and any of their respective controlling stockholders
and immediate family members, heirs, executors or legal representatives of such
controlling stockholders.
"Norway Debt Repayments" means the repayment of the Norway Notes on
----------------------
the Effective Date.
"Norway Notes" means, collectively, (i) the ASC Norway Note and (ii)
------------
the Holdings Norway Note.
"Note" means a Revolving Note, a Tranche A Term Note, a Tranche B Term
----
Note or a Swingline Note and "Notes" means any combination of the foregoing.
-----
"Notice of Borrowing" means a request by the Borrower for a Borrowing,
-------------------
substantially in the form of Exhibit A-1 hereto.
-----------
"Notice of Extension/Conversion" has the meaning set forth in Section
------------------------------ -------
3.02.
----
"Obligations" means, at any date, (i) all Credit Obligations and (ii)
-----------
all Derivatives Obligations of a Credit Party owed or owing to any Derivatives
Creditor.
"Operating Lease" means, as applied to any Person any lease (including
---------------
leases which may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) by such Person as lessee which is not a
Capital Lease.
"Original Credit Agreement" has the meaning set forth in the recitals
-------------------------
to this Amended and Restated Agreement.
25
"Parent" means American Seafoods Consolidated LLC, a Delaware limited
------
liability company, and its successors.
"Parent Guarantors" means the Parent and ASC, individually and
-----------------
collectively.
"Parent Guaranty Agreement" means the Guaranty Agreement,
-------------------------
substantially in the form of Exhibit E-1 hereto, dated January 28, 2000 executed
-----------
by the Holdings and the Parent in favor of the Administrative Agent, as modified
on the Effective Date by the Acknowledgment Agreement and as the same may be
further amended, modified or supplemented from time to time.
"Parent Pledge Agreement" means the Pledge Agreement, substantially in
-----------------------
the form of Exhibit F-2, dated January 28, 2000 among the Holdings, the Parent
-----------
and the Collateral Agent, as modified on the Effective Date by the
Acknowledgment Agreement and as the same may be further amended, modified or
supplemented from time to time.
"Participation Interest" means a Credit Event by a Lender by way of a
----------------------
purchase of a participation interest in Letters of Credit or LOC Obligations as
provided in Section 2.02(c), in Swingline Loans as provided in Section 2.05(c)
--------------- ---------------
or in any Loans as provided in Section 3.13.
------------
"PBGC" means the Pension Benefit Guaranty Corporation established
----
pursuant to Subtitle A of Title IV of ERISA or any entity succeeding to any or
all of its functions under ERISA.
"Perfection Certificate" means with respect to any Credit Party a
----------------------
certificate, substantially in the form of Exhibit F-4 to this Agreement,
-----------
completed and supplemented with the schedules and attachments contemplated
thereby to the satisfaction of the Collateral Agent and duly executed by a
Responsible Officer of such Credit Party.
"Permit" means any license, permit, franchise, right or privilege,
------
certificate of authority, endorsement, or order, or any waiver of the foregoing,
issued or issuable by any Governmental Authority.
"Permitted Acquisition" means an acquisition by the Borrower or any
---------------------
Subsidiary of the Borrower of the Capital Stock or all (or any substantial part
for which audited financial statements or other financial information
satisfactory to the Administrative Agent is available) of the assets or property
of another Person (including by merger or consolidation or by incorporation of a
new Subsidiary) for up to the fair market value of Capital Stock or property or
assets so acquired as determined in the reasonable business judgment of the
Borrower; provided that: (i) the Capital Stock or property or assets acquired in
--------
such acquisition relates to a line of business similar to the Businesses; (ii)
the representations and warranties made by the Credit Parties in each Credit
Document shall be true and correct in all material respects at and as of the
date of such acquisition (as if made on such date after giving effect to such
acquisition), except to the extent such representations and warranties expressly
relate to an earlier date (in which case such representations and warranties
shall be true and correct in all material respects at and as of such earlier
date); (iii) the Administrative Agent shall have received all items in respect
of the Capital Stock or property or assets acquired in such acquisition (and/or
the seller thereof) required to be delivered by Section 6.11; (iv) in the case
------------
of an acquisition of the Capital Stock of another Person, except in the case of
the incorporation of a new Subsidiary, the board of directors (or other
comparable governing body) of such other Person shall have duly approved such
acquisition; (v) no Default or Event of Default shall have occurred and be
continuing immediately before or immediately after giving effect to such
acquisition and the Borrower shall have delivered to the Administrative Agent a
Pro-Forma Compliance Certificate demonstrating that, upon giving effect to such
acquisition on a Pro-Forma Basis (with pro-forma adjustments satisfactory to the
Administrative Agent), the Borrower shall be in compliance with all of the
financial covenants set forth in Section 7.18 hereof as of the last day of the
------------
most recent period of
26
four consecutive fiscal quarters of the Borrower which precedes or ends on the
date of such acquisition and with respect to which the Administrative Agent has
received the consolidated financial information required under Section 6.01(a)
---------------
and (b) and the certificate required by Section 6.01(c); (vi) after giving
--- ---------------
effect to such acquisition, the Revolving Committed Amount shall be at least
$15,000,000 greater than the total Revolving Outstandings; and (vii) the
aggregate consideration (including cash, earn-out payments, assumption of
indebtedness and non-cash consideration) for all such acquisitions occurring
after the Effective Date shall not exceed $100,000,000.
"Permitted Encumbrances" means (i) those liens, encumbrances and other
----------------------
matters affecting title to any Mortgaged Property listed in the title policies
in respect thereof and found, on the date of delivery of such title policies to
the Collateral Agent in accordance with the terms hereof, reasonably acceptable
by the Collateral Agent, (ii) zoning and other municipal ordinances which are
not violated in any material respect by the existing improvements and the
present use by the mortgagor of the Premises (as defined in the respective
Mortgage) and (iii) such other items to which the Collateral Agent may consent
(such consent not to be unreasonably withheld).
"Permitted Investments" has the meaning set forth in Section 7.06.
--------------------- ------------
"Permitted Liens" has the meaning set forth in Section 7.02.
--------------- ------------
"Permitted Tax Dividend" has the meaning set forth in Section
---------------------- -------
7.07(iv).
--------
"Permitted Vessel Lease" means a lease or charter of an aggregate of
----------------------
no more than two Vessels that are determined in good faith to be obsolete or
surplus to the Business; provided that (A) such lease or charter shall not
--------
permit any such Vessel to be used outside the jurisdiction of the United States
of America or for any purpose illegal under the laws of the United States of
America or any state thereof, (B) the fair market value of all property subject
to Permitted Vessel Leases shall not exceed $30,000,000 at any time and (C) the
Fishing Rights or Fishing Rights Agreements, of the Borrower and its
Wholly-Owned Domestic Subsidiaries shall not be reduced or impaired as a result
of any such lease or charter.
"Person" means an individual, a corporation, a partnership, an
------
association, a limited liability company, a trust or an unincorporated
association or any other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
"Plan" means at any time any employee benefit plan (as defined in
----
Section 3(3) of ERISA) which is covered by ERISA and with respect to which any
Consolidated Party or any ERISA Affiliate is (or, if such plan were terminated
at such time, would under Section 4069 of ERISA be deemed to be) an "employer"
within the meaning of Section 3(5) of ERISA.
"PLC Debt" means the Debt of one or more members of the PLC Group
--------
outstanding under the Revolving Term Note and Loan Agreement dated December 26,
2001, as the same may be amended, supplemented or modified from time to time.
"PLC Distribution" means the distribution by the Borrower to the
----------------
Parent and by the Parent to Holdings on or prior to the Effective Date of all of
the ownership interests theretofore held by the Borrower in the PLC Group.
"PLC Group" means Pacific Longline Company LLC, a Washington limited
---------
liability company, Deep Pacific LLC, a Washington limited liability company,
▇▇▇▇▇ ▇▇▇ LLC, a Washington
27
limited liability company, and North Cape Fisheries LLC, a Washington limited
liability company, and their respective successors.
"Pledge Agreement" means the Pledge Agreement, substantially in the
----------------
form of Exhibit F-3 hereto, dated as of January 28, 2000 among the Borrower, the
-----------
Subsidiary Guarantors and the Collateral Agent, as modified on the Effective
Date by the Acknowledgment Agreement and as the same may be amended,
supplemented or modified from time to time.
"Pledged Collateral" has the meaning set forth in the Pledge Agreement
------------------
and the Parent Pledge Agreement.
"Pre-Commitment Information" means, taken as an entirety, (i)
--------------------------
information contained in the Offering Memorandum dated March 2002 and (ii) any
other written information in respect of the Borrower, any Subsidiary of the
Borrower or the Recapitalization provided to any Agent or Lender by or on behalf
of the Sponsor or the Borrower prior to the Effective Date.
"Preferred Stock" means, as applied to the Capital Stock of a Person,
---------------
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over the Capital Stock of any other class of such Person.
"Prepayment Account" has the meaning set forth in Section
------------------ -------
3.03(b)(viii).
-------------
"Prime Rate" means the rate of interest publicly announced by Bank of
----------
America, N.A. in Charlotte, North Carolina (or such other principal office of
the Administrative Agent as communicated in writing to the Borrower and the
Lenders) from time to time as its Prime Rate. Any change in the interest rate
resulting from a change in the Prime Rate shall become effective as of 12:01
A.M. of the Business Day on which each change in the Prime Rate is announced by
the Administrative Agent. It is a rate set by Bank of America, N.A. based upon a
variety of factors, including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above or below such announced
rate.
"Principal Amortization Payment" means a scheduled principal payment
------------------------------
on the Tranche A Term Loans pursuant to Section 2.03(e) or on the Tranche B Term
---------------
Loans pursuant to Section 2.04(e).
---------------
"Principal Amortization Payment Date" means a date on which a
-----------------------------------
Principal Amortization Payment is due.
"Principals" means the Sponsor Group, the Management Group, Coastal
----------
Villages ▇▇▇▇▇▇▇ LLC and Central Bering Sea Fishermen's Association.
"Pro-Forma Basis" means, for purposes of calculating compliance of any
---------------
transaction with any provision hereof, that the transaction in question shall be
deemed to have occurred as of the first day of the most recent period of four
consecutive fiscal quarters of the Borrower which precedes or ends on the date
of such transaction and with respect to which the Administrative Agent has
received the financial information for the Borrower and its Consolidated
Subsidiaries required under Section 6.01(a) or (b), as applicable, and the
--------------- ---
certificates required by Section 6.01(c) for such period. As used in this
---------------
definition, "transaction" means (i) any incurrence or assumption by a
Consolidated Party of Debt under Section 7.01(xiii) or Attributable Debt in
------------------
respect of a Sale/Leaseback Transaction under Section 7.13, (ii) any merger or
-------------
consolidation referred to in Section 7.04 or (iii) any Permitted Acquisition
------------
referred to in
28
Section 7.06(a)(xiv) or in clause (v) of the definition of "Permitted
-------------------- ----------
Acquisition" set forth in Section 1.01. In connection with any calculation of
------------
the financial covenants set forth in Section 7.18 upon giving effect to a
------------
transaction on a "Pro-Forma Basis", (i) any Debt incurred by the Borrower or any
of its Subsidiaries in connection with such transaction (or any other
transaction which occurred during the relevant four fiscal quarter period) shall
be deemed to have been incurred as of the first day of the relevant four fiscal
quarter period, (ii) if such Debt has a floating or formula rate, then the rate
of interest for such Debt for the applicable period for purposes of the
calculations contemplated by this definition shall be determined by utilizing
the rate which is or would be in effect with respect to such Debt as at the
relevant date of such calculations and (iii) income statement items (whether
positive or negative) attributable to all property acquired in such transaction
or to the Investment comprising such transaction, as applicable, shall be
included as if such transaction has occurred as of the first day of the relevant
four-fiscal-quarter period.
"Pro-Forma Compliance Certificate" means a certificate of a
--------------------------------
Responsible Officer or chief accounting officer of the Borrower delivered to the
Administrative Agent in connection with (i) any incurrence or assumption by a
Consolidated Party of Debt under Section 7.01(xiii) or Attributable Debt in
------------------
respect of a Sale/Leaseback Transaction under Section 7.13, (ii) any merger or
------------
consolidation referred to in Section 7.04 or (iii) any Permitted Acquisition
------------
referred to in Section 7.06(a)(xiv) and clause (v) of the definition of
-------------------- ----------
"Permitted Acquisition" set forth in Section 1.01 hereof and containing
------------
reasonably detailed calculations (with pro-forma adjustments satisfactory to the
Administrative Agent), upon giving effect to the applicable transaction on a
"Pro-Forma Basis", of the Interest Coverage Ratio, the Fixed Charge Coverage
Ratio and the Leverage Ratio as of the last day of the most recent period of
four consecutive fiscal quarters of the Borrower which precedes or ends on the
date of the applicable transaction and with respect to which the Administrative
Agent shall have received the consolidated financial information for the
Borrower and its Consolidated Subsidiaries required under Section 6.01(a) or
---------------
(b), as applicable, and the certificate required by Section 6.01(c) for such
--- ---------------
period.
"Projections" has the meaning set forth in Section 4.01(c).
----------- ---------------
"Qualified Capital Stock" means Capital Stock of the ASLP issued in a
-----------------------
Qualifying Equity Issuance.
"Qualifying Equity Issuance" means (a) the issuance by ASLP for cash
--------------------------
of its Capital Stock to the Sponsor Group or any other Person (including,
without limitation, to one or more employee stock ownership plans sponsored by
the Parent or the Borrower) if: (i) 100% of the proceeds of such issuance shall
be immediately contributed by ASLP to Holdings, by Holdings to the Parent and by
the Parent to the Borrower; (ii) no Default or Event of Default shall have
occurred or be continuing on the date of issuance, both before and after giving
effect thereto; (iii) after giving effect thereto, no Change of Control shall
have occurred; (iv) such stock shall be issued in a private placement exempt
from registration under the Securities Act; (v) the proceeds thereof shall not
be used to repay any Debt (other than the Obligations) or to make any Restricted
Payment; (vi) within 10 Business Days after such issuance, the Borrower shall
have delivered to the Administrative Agent a certificate of a Responsible
Officer of the Borrower attesting to the satisfaction of the foregoing
conditions, describing the uses of the proceeds of such issuance and attesting
that such use shall not constitute a Default or an Event of Default; and (vii)
such proceeds shall be used within 45 days after such issuance as described in
such certificate; or (b) a Qualifying IPO.
"Qualifying IPO" means an underwritten primary public offering (other
--------------
than a public offering pursuant to a registration statement on Form S-8 (or any
successor form)) of the common Capital Stock of ASLP, Holdings or any member of
Holdings organized for the purpose of achieving, directly or indirectly, public
ownership of ASLP or Holdings, as the case may be (i) pursuant to an effective
registration statement filed with the Securities and Exchange Commission in
accordance with the
29
Securities Act (whether alone or in conjunction with a secondary public
offering) and (ii) resulting in gross proceeds of at least $45,000,000.
"Real Property" means, with respect to any Person, all of the right,
-------------
title and interest of such Person in and to land, improvements and fixtures,
including Leaseholds.
"Recapitalization" means the Borrower Debt Refinancing, the Norway
----------------
Debt Repayment, the making of the Special Distribution and the PLC Distribution,
the making of the Equity Distribution and the payment by the Borrower of related
fees and expenses.
"Recapitalization Documents" has the meaning set for in Section
-------------------------- -------
4.01(f).
-------
"Refinanced Agreements" means those instruments, documents and
---------------------
agreements listed on Schedule 1.01C.
---------------
"Register" has the meaning set forth in Section 10.03(c).
-------- ----------------
"Regulation A, O, T, U or X" means Regulation A, O, T, U or X,
--------------------------
respectively, of the Board of Governors of the Federal Reserve System, as
amended, or any successor regulation.
"Reinvestment Funds" means, with respect to any Insurance Proceeds or
------------------
any Condemnation Award, that portion of such funds as shall, according to a
certificate of a Responsible Officer of the Borrower delivered to the
Administrative Agent within 90 days after the occurrence of the Casualty or
Condemnation giving rise thereto (and in any case prior to the receipt thereof
by any Consolidated Party), be reinvested in the repair, restoration or
replacement of the properties that were the subject of such Casualty or
Condemnation; provided that (i) the aggregate amount of such proceeds with
--------
respect to any such event or series of related events shall not exceed (x) the
lesser of (A) $95,000,000 (such amount to be increased by 5% per annum) with
respect to the Vessels and (B) the aggregate amount of such proceeds relating to
the total loss of any single Vessel and (y) otherwise $7,500,000, in either case
without the prior written consent of the Required Lenders, (ii) such certificate
shall be accompanied by evidence reasonably satisfactory to the Administrative
Agent that any property subject to such Casualty or Condemnation has been or
will be repaired, restored or replaced to its condition immediately prior to
such Casualty or Condemnation, (iii) pending such reinvestment, the entire
amount of such proceeds shall be deposited in an account with the Collateral
Agent for the benefit of the Secured Parties, over which the Collateral Agent
shall have sole control and exclusive right of withdrawal (which may include the
Reinvestment Funds Account established under the Security Agreement), (iv) from
and after the date of delivery of such certificate, the Borrower or one or more
of its Subsidiaries shall diligently proceed, in a commercially reasonable
manner, to complete the repair, restoration or replacement of the properties
that were the subject of such Casualty or Condemnation as described in such
certificate and (v) no Default or Event of Default shall have occurred and be
continuing; and provided further that, if any of the foregoing conditions shall
-------- -------
cease to be satisfied at any time, such funds shall no longer be deemed
Reinvestment Funds and such funds shall immediately be applied to prepayment of
the Loans in accordance with Section 3.03(b).
---------------
"Related Party" means: (i) with respect to any Principal other than an
-------------
individual, any controlling stockholder, partner, member or 80% (or more) owned
Subsidiary; (ii) with respect to any Principal other than an individual, any
trust, corporation, partnership or other entity, the beneficiaries,
stockholders, partners, owners or Persons beneficially holding an 80% or more
controlling interest of which consist of any one or more Principals and/or such
other Persons referred to in the immediately preceding clause (i); or (iii) with
----------
respect to any Principal that is an individual, (A) any immediate family member,
heir, executor or legal representative of such individual or (B) any trust,
corporation, partnership
30
or other entity, the beneficiaries, stockholders, partners, owners or Persons
beneficially holding an 80% or more controlling interest of which consist of any
one or more individuals who are part of the Management Group or members of their
immediate families.
"Replacement Date" has the meaning set froth in Section 3.04(d).
---------------- ---------------
"Replacement Lender" has the meaning set froth in Section 3.04(d).
------------------ ---------------
"Reportable Event" means a "reportable event" as defined in Section
----------------
4043 of ERISA with respect to which the notice requirements to the PBGC have not
been waived.
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
----------------
hereinafter defined) constitutes more than 50% of the Credit Exposure of all
Lenders at such time. For purposes of the preceding sentence, the term "Credit
------
Exposure" as applied to each Lender shall mean (i) at any time prior to the
--------
termination of the Commitments, the sum of (A) the Revolving Commitment
Percentage of such Lender multiplied by the Revolving Committed Amount plus (B)
the Tranche A Term Loan Commitment Percentage of such Lender multiplied by the
aggregate principal amount of the Tranche A Term Loans outstanding at such time
plus (C) the Tranche B Term Loan Commitment Percentage of such Lender multiplied
by the aggregate principal amount of the Tranche B Term Loans outstanding, and
(ii) at any time after the termination of the Commitments, the sum of (A) the
principal balance of the outstanding Loans of such Lender plus (B) such Lender's
Participation Interests in all LOC Obligations and Swingline Loans.
"Requirement of Law" means, as to any Person, the articles or
------------------
certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or final,
non-appealable determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or to which
any of its material property is subject.
"Responsible Officer" shall mean, as to any Person, the president,
-------------------
chief executive officer, chief operating officer, any financial officer, any
vice president or the general counsel of such Person (or, (i) in the case of a
partnership, the managing general partner of such Person and (ii) in the case of
a limited liability company, the managing or sole member of such Person).
"Restricted Payment" means (i) any dividend or other distribution,
------------------
direct or indirect, on account of any class of Capital Stock or Equity
Equivalents of any Consolidated Party, now or hereafter outstanding, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any class of Capital Stock or
Equity Equivalents of any Consolidated Party, now or hereafter outstanding,
(iii) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire any class of Capital Stock or
Equity Equivalents of any Consolidated Party, now or hereafter outstanding or
(iv) (A) any payment or prepayment of principal of, premium, if any, redemption,
purchase, retirement, defeasance, sinking fund or similar payment with respect
to, the Senior Subordinated Notes or (B) any payment or prepayment of principal
of, premium, if any, or interest on, redemption, purchase retirement,
defeasance, sinking fund or similar payment with respect to, any other
Subordinated Debt.
"Retiring Lender" means a Lender that ceases to be a Lender hereunder
---------------
pursuant to Section 3.04(d).
---------------
"Revolving Borrowing" means a Borrowing comprised of Revolving Loans
-------------------
and identified as such in the Notice of Borrowing with respect thereto.
31
"Revolving Commitment" means, with respect to any Lender, the
--------------------
commitment of such Lender, in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage of the
Revolving Committed Amount, (i) to make Revolving Loans in accordance with the
provisions of Section 2.01(a), (ii) to purchase Participation Interests in
--------------- ----
Letters of Credit in accordance with the provisions of Section 2.02(c) and (iii)
---------------
to purchase Participation Interests in Swingline Loans in accordance with the
provisions of Section 2.05(c).
---------------
"Revolving Commitment Percentage" means, for each Lender, the
-------------------------------
percentage identified as its Revolving Commitment Percentage on Schedule 1.01A
--------------
hereto, as such percentage may be modified in connection with any assignment
made in accordance with the provisions of Section 10.03(b).
----------------
"Revolving Committed Amount" means $75,000,000 or such lesser amount
--------------------------
to which the Revolving Committed Amount may be reduced pursuant to Section 3.04.
------------
"Revolving Lender" means each Lender identified in the Schedule 1.01A
---------------- --------------
as having a Revolving Commitment and each Eligible Assignee which acquires a
Revolving Commitment or Revolving Loan pursuant to Section 10.03(b) and their
----------------
respective successors.
"Revolving Loan" means a Loan made under Section 2.01(a).
-------------- ---------------
"Revolving Note" means a promissory note, substantially in the form of
--------------
Exhibit B-1 hereto, evidencing the obligation of the Borrower to repay
-----------
outstanding Revolving Loans, as such note may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"Revolving Outstandings" has the meaning set forth in Section 2.01(a).
---------------------- ---------------
"Revolving Termination Date" means September 30, 2007 (or, if such day
--------------------------
is not a Business Day, the next preceding Business Day) or such earlier date
upon which the Revolving Commitments shall have been terminated in their
entirety in accordance with this Agreement.
"Safe Harbor Percentage" means 88% of the Foreign Ownership Percentage
----------------------
that, if exceeded by ASLP, the Parent, Holdings or any of their respective
Affiliates or Subsidiaries, would cause ASLP, the Parent, Holdings or any of
their respective Subsidiaries to be a Foreign Person.
"Sale/Leaseback Transaction" means any direct or indirect arrangement
--------------------------
with any Person or to which any such Person is a party providing for the leasing
to the Borrower or any of its Subsidiaries of any property, whether owned by the
Borrower or any of its Subsidiaries as of the Effective Date or later acquired,
which has been or is to be sold or transferred by the Borrower or any of its
Subsidiaries to such Person or to any other Person from whom funds have been, or
are to be, advanced by such Person on the security of such property.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
---
Hill, Inc., a New York corporation, and its successor or, absent any such
successor, such nationally recognized statistical rating organization as the
Borrower and the Administrative Agent may select.
"Securities Act" means the Securities Act of 1933, as amended, and the
--------------
rules and regulations promulgated thereunder.
"Security Agreement" means the Security Agreement dated as of January
------------------
28, 2000, as amended and restated on and as of the Effective Date by the Amended
and Restated Security Agreement, substantially in the form of Exhibit F-1
-----------
hereto, among the Parent, the Borrower, ASC, the Subsidiary
32
Guarantors and the Collateral Agent, as the same may be further amended,
modified or supplemented from time to time.
"Securityholders' Agreement" means the Securityholders' Agreement
--------------------------
dated as of January 28, 2000 among ASLP, ASC Management, Inc., Centre Capital
Investors III, L.P., Centre Capital Individual Investors III, L.P., CP3
Tax-Exempt Holdings Corp., ASC Offshore Holdings Corp., Centre Capital Partners
Coinvestments III, L.P., Coastal Villages ▇▇▇▇▇▇▇ LLC, SF Partner XXIV, LLC,
Resource Group International, Inc, Norway Seafoods ASA, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, as amended on or prior
to the Effective Date and as the same may be further amended, modified or
supplemented from time to time in accordance with the provisions thereof and of
this Agreement.
"Senior Subordinated Note Documents" means, collectively, the Senior
----------------------------------
Subordinated Note Indenture and any other indentures, note purchase agreements,
promissory notes, guarantees and other instruments and agreements evidencing the
terms of the Senior Subordinated Notes, as amended, supplemented, amended and
restated or otherwise modified in accordance therewith and with Section 7.08(a).
---------------
"Senior Subordinated Note Indenture" means the Indenture dated as of
----------------------------------
April 18, 2002 among the Borrower, the Co-Issuer, the guarantors set forth
therein, and ▇▇▇▇▇ Fargo Bank Minnesota, National Association, as Trustee, as in
effect on the Effective Date (as the same may be amended or otherwise modified
from time to time thereafter in accordance with the terms hereof and thereof),
pursuant to which the Senior Subordinated Notes were issued.
"Senior Subordinated Notes" means the 10-1/8% Senior Subordinated
-------------------------
Notes due April 15, 2010 co-issued by the Borrower and the Co-Issuer, including
any notes issued by the Borrower and the Co-Issuer to holders of Senior
Subordinated Notes to exchange Senior Subordinated Notes for notes with
substantially identical terms registered under the Securities Act.
"Single Employer Plan" means any Plan which is covered by Title IV of
--------------------
ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Person as of a particular date,
-------
that on such date (i) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person's ability to
pay as such debts and liabilities mature in their ordinary course, (iii) such
Person is not engaged in a business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's assets would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged or is to engage, (iv)
the fair value of the assets of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of such
Person and (v) the aggregate fair saleable value (i.e., the amount that may be
realized within a reasonable time, considered to be six months to one year,
either through collection or sale at the regular market value, conceiving the
latter as the amount that could be obtained for the assets in question within
such period by a capable and diligent businessman from an interested buyer who
is willing to purchase under ordinary selling conditions) of the assets of such
Person will exceed its debts and other liabilities (including contingent,
subordinated, unmatured and unliquidated debts and liabilities). For purposes of
this definition, "debt" means any liability on a claim, and "claim" means (i) a
right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured,
33
disputed, undisputed, legal, equitable, secured or unsecured, or (ii) a right to
an equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right is an equitable remedy, is reduced judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
"Special Distribution" means the payment on the Effective Date of a
--------------------
cash distribution in an aggregate amount not exceeding $325,000,000 (i) by the
Borrower to ASC, the proceeds of which will be used by ASC to repay the ASC
Norway Note and (ii) by the Borrower to the Parent and by the Parent to
Holdings, the proceeds of which will be used by Holdings to repay the
outstanding principal of, and accrued interest on, the Holdings Norway Note, to
pay certain fees and expenses of Holdings and to make the Equity Distribution.
"Sponsor" means Centre Partners Management LLC, and its successors.
-------
"Sponsor Group" means the Sponsor and any funds managed by the Sponsor
-------------
or its Affiliates.
"Sponsor Release Date" means the first date upon which (i) the
--------------------
aggregate principal amount of Term Loans outstanding hereunder shall be less
than $195,000,000 and (ii) no Default or Event of Default shall have occurred
and be continuing.
"Standby Letter of Credit Fee" has the meaning set forth in Section
---------------------------- -------
3.05(b)(i).
----------
"Subordinated Debt" of any Person means (i) with respect to the
-----------------
Borrower or the Co-Issuer, the Senior Subordinated Notes and (ii) all other Debt
which (A) by its terms is not required to be repaid, in whole or in part, before
the first anniversary of the Final Termination Date, (B) is by its terms
expressly subordinated in right of payment to such Person's indebtedness,
obligations and liabilities to the Lenders under the Credit Documents pursuant
to payment and subordination provisions satisfactory in form and substance to
the Required Lenders and (C) is issued pursuant to credit documents having
covenants, subordination provisions and events of default that are satisfactory
in form and substance to the Required Lenders but that in no event are less
favorable, including with respect to rights of acceleration, to such Person than
the terms hereof.
"Subsidiary" means with respect to any Person any corporation,
----------
partnership, limited liability company, association or other business entity of
which (i) if a corporation, more than 50% of the total voting power of stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a partnership,
limited liability company, association or business entity other than a
corporation, more than 50% of the partnership or other similar ownership
interests thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more Subsidiaries of that Person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have more than 50%
ownership interest in a partnership, limited liability company, association or
other business entity if such Person or Persons shall be allocated more than 50%
of partnership, association or other business entity gains or losses or shall be
or control the manager or a general partner of such partnership, association or
other business entity.
"Subsidiary Guarantors" means each Subsidiary of the Borrower on the
---------------------
Effective Date (other than a Foreign Subsidiary) which has executed the
Subsidiary Guaranty Agreement or Joinder Agreement relating thereto, and each
future Wholly-Owned Subsidiary of the Borrower (other than a Foreign Subsidiary,
except to the extent otherwise provided in Section 6.11(d), or a Joint Venture
---------------
Entity)
34
which may thereafter execute a Joinder Agreement, together with their successors
and permitted assigns, and "Subsidiary Guarantor" means any one of them.
--------------------
"Subsidiary Guaranty Agreement" means the Subsidiary Guaranty,
-----------------------------
substantially in the form of Exhibit E-2 hereto, dated as of January 28, 2000
-----------
among the Subsidiary Guarantors and the Administrative Agent, as modified on the
Effective Date by the Acknowledgment Agreement and as the same may be amended,
modified or supplemented from time to time.
"Swingline Commitment" means the agreement of the Swingline Lender to
--------------------
make Loans pursuant to Section 2.05.
------------
"Swingline Committed Amount" means $15,000,000 (or such other amount
--------------------------
as the Borrower and the Swingline Lender may agree from time to time), as such
Swingline Committed Amount may be reduced pursuant to Section 3.04.
------------
"Swingline Lender" means Bank of America, N.A., in its capacity as the
----------------
Swingline Lender under Section 2.05, and its successor or successors in such
------------
capacity.
"Swingline Loan" means a Base Rate Loan made by the Swingline Lender
--------------
pursuant to Section 2.05, and "Swingline Loans" means any two or more of such
------------ ---------------
Base Rate Loans.
"Swingline Note" means a promissory note, substantially in the form of
--------------
Exhibit B-4 hereto, evidencing the obligation of the Borrower to repay
-----------
outstanding Swingline Loans, as such note may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"Swingline Termination Date" means the earlier of (i) September 30,
--------------------------
2007 or such earlier date upon which the Revolving Commitments shall have been
terminated in their entirety in accordance with this Agreement and (ii) the date
on which the Swingline Commitment is terminated in its entirety in accordance
with the Agreement.
"Synthetic Lease" means any synthetic lease, tax retention operating
---------------
lease, off-balance sheet loan or similar off-balance sheet financing arrangement
where such arrangement is considered borrowed money indebtedness of the obligor
for tax purposes but is classified as an Operating Lease of the obligor in
accordance with GAAP.
"Term Loan" means a Tranche A Term Loan or a Tranche B Term Loan, and
---------
"Term Loans" means any two or more of them, collectively.
----------
"Theoretical Tax" means with respect to any amount, the product of (i)
---------------
such amount and (ii) the maximum combined United States federal, New York State
and New York City tax rate applicable to an individual resident or corporation
(whichever is higher) on ordinary income and net short-term capital gains or on
net long term capital gains, as applicable, after having given effect to the
deductibility for federal income tax purposes of state and local income taxes.
"Trade Letter of Credit Fee" has the meaning set forth in Section
-------------------------- -------
3.05(b)(ii).
-----------
"Tranche A Term Loan" means a Loan made to the Borrower under Section
------------------- -------
2.03(a) and "Tranche A Term Loans" means the Tranche A Term Loans of the
------- --------------------
Lenders, collectively.
"Tranche A Term Loan Borrowing" means a Borrowing comprised of Tranche
-----------------------------
A Term Loans and identified as such in the Notice of Borrowing with respect
thereto.
35
"Tranche A Term Loan Commitment" means, with respect to any Lender,
------------------------------
the commitment of such Lender to make Tranche A Term Loans to the Borrower on
the Effective Date in an aggregate principal amount equal to such Lender's
applicable Tranche A Term Loan Commitment Percentage of the applicable Tranche A
Term Loan Committed Amount.
"Tranche A Term Loan Commitment Percentage" means, collectively, for
-----------------------------------------
any Lender, the percentage, if any, identified as its Tranche A Term Loan
Commitment Percentage on Schedule 1.01A, as such percentages may be modified in
--------------
connection with any assignment made in accordance with the provisions of Section
-------
10.03(b).
--------
"Tranche A Term Loan Committed Amount" means $90,000,000, or such
------------------------------------
lesser amount to which the Tranche A Term Loan Committed Amount may be reduced
pursuant to Section 3.04.
------------
"Tranche A Term Loan Maturity Date" means September 30, 2007 (or, if
---------------------------------
such day is not a Business Day, the next preceding Business Day) or such earlier
date on upon which the aggregate unpaid principal amount of the Tranche A Term
Loans shall have been repaid in full.
"Tranche A Term Note" or "Tranche A Term Notes" means a promissory
------------------- --------------------
note, substantially in the form of Exhibit B-2 hereto evidencing the obligations
-----------
of the Borrower to repay the outstanding Tranche A Term Loans, as such note may
be amended, modified, restated, supplemented, extended, renewed or replaced from
time to time.
"Tranche B Term Loan" means a Loan made to the Borrower under Section
------------------- -------
2.04(a), and "Tranche B Term Loans" means the Tranche B Term Loans of the
------- --------------------
Lenders, collectively.
"Tranche B Term Loan Borrowing" means a Borrowing comprised of Tranche
-----------------------------
B Term Loans and identified as such in the Notice of Borrowing with respect
thereto.
"Tranche B Term Loan Commitment" means with respect to any Lender, the
------------------------------
commitment of such Lender to make Tranche B Term Loans to the Borrower on the
Effective Date in an aggregate principal amount equal to such Lender's Tranche B
Term Loan Commitment Percentage of the Tranche B Term Loan Committed Amount.
"Tranche B Term Loan Commitment Percentage" means, for any Lender, the
-----------------------------------------
percentage, if any, identified as its Tranche B Term Loan Commitment Percentage
on Schedule 1.01A, as such percentage may be modified in connection with any
--------------
assignment made in accordance with the provisions of Section 10.03(b).
----------------
"Tranche B Term Loan Committed Amount" means $230,000,000, or such
------------------------------------
lesser amount to which the Tranche B Term Loan Committed Amount may be reduced
pursuant to Section 3.04.
------------
"Tranche B Term Loan Maturity Date" means March 31, 2009 (or, if such
---------------------------------
day is not a Business Day, the next preceding Business Day) or such earlier date
on upon which the aggregate unpaid principal amount of the Tranche B Term Loans
shall have been repaid in full.
"Tranche B Term Note" or "Tranche B Term Notes" means a promissory
------------------- --------------------
note, substantially in the form of Exhibit B-3 hereto, evidencing the
-----------
obligations of the Borrower to repay the outstanding Tranche B Term Loans, as
such promissory note may be amended, modified, restated, supplemented, extended,
renewed or replaced from time to time.
36
"Transaction" means the Recapitalization, the issuance of the Senior
-----------
Subordinated Notes, the entering into of, and the initial Borrowing under this
Agreement and the other Credit Documents, the payment of costs and expenses
associated herewith and therewith and all other related transactions
contemplated to occur in connection herewith or therewith.
"Transaction Documents" means the Recapitalization Documents, the
---------------------
Senior Subordinated Note Documents and the Credit Documents, collectively, and
"Transaction Document" means any one of them.
--------------------
"Type" has the meaning set forth in Section 1.04.
---- ------------
"United States" means the United States of America, including the
-------------
States and the District of Columbia, but excluding its territories and
possessions.
"Unused Revolving Commitment Amount" means, for any period, the amount
----------------------------------
by which (i) the then applicable Revolving Committed Amount exceeds (ii) the
daily average sum for such period of (A) the aggregate principal amount of all
outstanding Revolving Loans plus (B) the aggregate amount of all outstanding LOC
Obligations.
"Vessel" and "Vessels" means each vessel and, collectively all
------ -------
vessels, owned by the Borrower or one or more of its Subsidiaries and identified
on Schedule 5.25 and all vessels thereafter acquired.
-------------
"Vessel Mortgage" means any mortgage on the Vessels that is granted
---------------
pursuant to this Agreement substantially in the form of Exhibit F-6 hereto, as
-----------
each such mortgage may be amended, supplemented or modified from time to time.
"Vessel Mortgage Documents" means, with respect to each Vessel, the
-------------------------
items specified in Section 4.01(j).
---------------
"Vessel Owning Companies" means American Seafoods Company LLC,
-----------------------
American Challenger LLC, American Dynasty LLC, American Triumph LLC, Ocean Rover
LLC, Northern Eagle LLC, Northern Hawk LLC, Northern ▇▇▇▇▇▇ LLC and Katie ▇▇▇
LLC, each a Delaware limited liability company, and their respective successors.
"Vessel Permitted Liens" means any of the following to the extent
----------------------
incurred and, from time to time discharged, in the ordinary course of business
of the Consolidated Parties: (i) liens for crew wages (including without
limitation wages of the master of a Vessel); (ii) liens for general average and
salvage; (iii) liens for necessaries provided to a Vessel; (iv) liens for
damages arising from maritime torts, (v) liens arising by operation of law in
the ordinary course of business in operating, maintaining or repairing a Vessel
and (vi) Liens described on Schedule 1.01E.
--------------
"Voting Securities" means, with respect to any Person, securities or
-----------------
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions of such Person (irrespective of whether or not at the time securities
or other ownership interests of any other class or classes of such Person shall
have or might have voting power by reason of the happening of any contingency).
"Wholly-Owned Subsidiary" means, with respect to any Person at any
-----------------------
date, any Subsidiary of such Person all of the shares of capital stock or other
ownership interests of which (except directors' qualifying shares) are at the
time directly or indirectly owned by such Person.
37
Section 1.02 Computation of Time Periods and other Definitional
--------------------------------------------------
Provisions. The definitions in Section 1.01 shall apply equally to both the
---------- ------------
singular and plural forms of the terms defined. For purposes of computation of
periods of time hereunder, the word "from" means "from and including" and the
words "to" and "until" each mean "to but excluding". References in this
Agreement to Articles, Sections, Schedules, Appendices or Exhibits shall be to
Articles, Sections, Schedules, Appendices or Exhibits of or to this Agreement
unless otherwise specifically provided. All references to time herein shall be
references to Eastern Standard time or Eastern Daylight time, as the case may
be, unless specified otherwise.
Section 1.03 Accounting Terms and Determinations. Except as otherwise
-----------------------------------
expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders hereunder shall be
prepared in accordance with GAAP, applied on a consistent basis, as in effect at
the time of such preparation. All financial statements delivered to the Lenders
hereunder shall be accompanied by a statement from the Borrower that GAAP has
not changed since the most recent financial statements delivered by the Borrower
to the Lenders or if GAAP has changed describing such changes in detail and
explaining how such changes affect the financial statements. All calculations
made for the purposes of determining compliance with this Agreement shall
(except as otherwise expressly provided herein) be made by application of GAAP
applied on a basis consistent with the most recent annual or quarterly financial
statements delivered pursuant to Section 6.01 (or, prior to the delivery of the
------------
first financial statements pursuant to Section 6.01, consistent with the
------------
financial statements described in Section 5.01(a)); provided, however, if (i)
--------------- -------- -------
the Borrower shall object to determining such compliance on such basis at the
time of delivery of such financial statements due to any change in GAAP or the
rules promulgated with respect thereto or (ii) either the Administrative Agent
or the Required Lenders shall so object in writing within 60 days after delivery
of such financial statements (or after the Lenders have been informed of the
change in GAAP affecting such financial statements, if later), then such
calculations shall be made on a basis consistent with the most recent financial
statements delivered by the Borrower to the Lenders as to which no such
objection shall have been made. Notwithstanding the above or the terms of any
definition in Section 1.01, the parties hereto acknowledge and agree that, for
------------
purposes of all calculations made in connection with the financial covenants set
forth in Section 7.18 (including without limitation for purposes of the
------------
definitions of "Applicable Percentage" and "Pro Forma Basis" set forth in
Section 1.01) after consummation of (i) any merger or consolidation referred to
------------
in Section 7.04 or (ii) any Permitted Acquisition referred to in Section
------------ -------
7.06(a)(xiv) or in clause (v) of the definition of "Permitted Acquisition" set
------------ ----------
forth in Section 1.01 (any such event referred to in the immediately forgoing
------------
clauses (i) or (ii) being herein referred to as a "transaction"), (A) any Debt
----------- ---- -----------
incurred or assumed by the Borrower or any of its Subsidiaries in connection
with such transaction (or any other transaction which occurred during the
relevant four fiscal quarter period) shall be deemed to have been incurred as of
the first day of the relevant four fiscal-quarter period, (B) if such Debt has a
floating or formula rate, then the rate of interest for such Debt for the
applicable period for purposes of the calculations contemplated by this
definition shall be determined by utilizing the rate which is or would be in
effect with respect to such Debt as at the relevant date of such calculations
and (C) income statement items (whether positive or negative) attributable to
all property acquired in such transaction or to the Investment comprising such
transaction, as applicable, shall be included as if such transaction has
occurred as of the first day of the relevant four-fiscal-quarter period.
Section 1.04 Classes and Types of Borrowings. The term "Borrowing"
------------------------------- ---------
denotes the aggregation of Loans of one or more Lenders to be made to the
Borrower pursuant to Article II on the same date, all of which Loans are of the
----------
same Class and Type (subject to Section 3.09) and, except in the case of Base
------------
Rate Loans, have the same initial Interest Period. Loans hereunder are
distinguished by "Class" and "Type". The "Class" of a Loan (or of a Commitment
-----
to make such a Loan or of a Borrowing comprised of such Loans) refers to whether
such Loan is a Revolving Loan, Tranche A Term Loan,
38
Tranche B Term Loan or Swingline Loan. The "Type" of a Loan refers to whether
----
such Loan is a Eurodollar Loan or a Base Rate Loan. Identification of a Loan (or
a Borrowing) by both Class and Type (e.g., a "Tranche A Eurodollar Loan")
indicates that such Loan is a Loan of both such Class and such Type (e.g., both
a Tranche A Term Loan and a Eurodollar Loan) or that such Borrowing is comprised
of such Loans.
ARTICLE II
THE CREDIT FACILITIES
Section 2.01 Revolving Loans.
---------------
(a) Revolving Commitments. Subject to the terms and conditions set
---------------------
forth herein, each Revolving Lender severally agrees to make Revolving Loans to
the Borrower, in Dollars, at any time and from time to time during the period
from and including the Effective Date to but not including the Revolving
Termination Date (or such earlier date if the Revolving Committed Amount has
been terminated as provided herein); provided, however, that (i) the sum of the
-------- -------
aggregate principal amount of Revolving Loans outstanding plus the aggregate
amount of LOC Obligations outstanding plus the aggregate principal amount of
Swingline Loans outstanding (collectively, the "Revolving Outstandings") shall
----------------------
not exceed the Revolving Committed Amount and (ii) with respect to each
individual Lender, such Lender's outstanding Revolving Loans plus such Lender's
Participation Interests in outstanding LOC Obligations plus (other than the
Swingline Lender) such Lender's Participation Interests in Swingline Loans
outstanding shall not exceed such Lender's Revolving Commitment Percentage of
the Revolving Committed Amount. Each Revolving Borrowing shall be in an
aggregate principal amount of $2,000,000 or any larger integral multiple of
$500,000 (except that any such Borrowing may be in the amount of the unused
Revolving Committed Amount and shall be made from the Revolving Lenders ratably
in the proportions that their respective Revolving Commitment Percentages bear
to the aggregate principal amount of each Revolving Borrowing). Revolving Loans
may consist of Base Rate Loans or Eurodollar Loans, or a combination thereof, as
the Borrower may request, and may be repaid and reborrowed in accordance with
the provisions hereof, provided, however, that the Revolving Loans outstanding
-------- -------
at any time shall consist of no more than eight separate Groups of Eurodollar
Loans. For purposes hereof, Eurodollar Loans with different Interest Periods
shall be considered as separate Groups of Eurodollar Loans, even if they begin
on the same date, although Eurodollar Loans of any Class may, in accordance with
the provisions hereof, be combined through extensions or conversions at the end
of existing Interest Periods to constitute a single new Group of Eurodollar
Loans of such Class with the same Interest Period.
(b) Method of Borrowing for Revolving Loans. (i) By no later than
---------------------------------------
12:00 noon (local time in Charlotte, North Carolina) on the Business Day prior
to date of the requested borrowing of Revolving Loans that will be Base Rate
Loans or (ii) no later than 1:00 P.M. (local time in Charlotte, North Carolina)
on the fourth Business Day prior to the date of the requested borrowing of
Revolving Loans that will be Eurodollar Loans, the Borrower shall telephone the
Administrative Agent as well as submit a written Notice of Borrowing in the form
of Exhibit A-1 to the Administrative Agent setting forth (A) the aggregate
-----------
principal amount of Revolving Loans requested, (B) whether such Revolving Loans
shall accrue interest at the Adjusted Base Rate or the Adjusted Eurodollar Rate,
(C) with respect to Revolving Loans that will be Eurodollar Loans, the initial
Interest Period applicable thereto (which shall be subject to the definition of
Interest Period) and (D) certification that the Borrower has complied in all
respects with Section 4.02. If the Borrower shall fail to specify (x) an
------------
Interest Period in the case of a Eurodollar Loan, then such Eurodollar Loan
shall be deemed to have an Interest Period of one month, or (y) the type of
Revolving Loan requested, then such Revolving Loan shall be deemed to be a Base
Rate Loan. All Revolving Loans on the Effective Date shall be Base Rate Loans
unless the Borrower delivers to the Administrative Agent at least three Business
Days prior to the Effective Date a funding indemnity letter in form and
substance reasonably satisfactory to the Administrative Agent. Thereafter, all
or any
39
portion of the Revolving Loans may be converted into Eurodollar Loans in
accordance with the terms of Section 3.01(c) and the definition of "Interest
---------------
Period" set forth in Section 1.01.
------------
(c) Funding of Revolving Loans. Upon receipt of a Notice of Borrowing,
--------------------------
the Administrative Agent shall promptly inform each Revolving Lender as to the
terms thereof. Each Revolving Lender shall make its Revolving Loan Commitment
Percentage of the requested Revolving Borrowing available to the Administrative
Agent by 3:00 P.M. (local time in Charlotte, North Carolina) on the date
specified in the Notice of Borrowing by deposit, in Dollars, of immediately
available funds at the offices of the Administrative Agent at its principal
office in Charlotte, North Carolina or at such other address as the
Administrative Agent may designate in writing. Unless the Administrative Agent
determines that any applicable condition set forth in Article IV has not been
----------
satisfied, the Administrative Agent shall (i) apply any funds received in
respect of a Mandatory LOC Borrowing pursuant to Section 2.02(e) to reimburse
---------------
the applicable Issuing Lender for outstanding LOC Obligations, (ii) apply any
funds received in respect of outstanding Swingline Loans pursuant to Section
-------
2.05(c) to repay Swingline Loans and (iii) make the remainder of the funds so
-------
received available to the Borrower by crediting the account of the Borrower on
the books of such office of the Administrative Agent.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make Revolving Loans hereunder; provided, however,
-------- -------
that the failure of any Lender to fulfill its obligations hereunder shall not
relieve any other Lender of its obligations hereunder. Unless the Administrative
Agent shall have been notified by any Lender prior to the date of any Revolving
Borrowing that such Lender does not intend to make available to the
Administrative Agent its portion of the Revolving Loans to be made on such date,
the Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent on the date of such Revolving Borrowing,
and the Administrative Agent in reliance upon such assumption, may (in its sole
discretion but without any obligation to do so) make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Administrative Agent, the Administrative Agent shall be entitled to
recover such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent will promptly notify the Borrower, and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent shall also be entitled to recover from the
Lender or the Borrower, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such
corresponding amount is recovered by the Administrative Agent at a per annum
rate equal to (i) from the Borrower at the applicable rate for such Revolving
Loan pursuant to the Notice of Borrowing and (ii) from a Lender at the Federal
Funds Rate if paid within two Business Days of the date of drawing, and
thereafter at a rate equal to the Base Rate. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Lender's Revolving Loan included in such Borrowing for purposes
of this Agreement.
(d) Revolving Notes. Subject to Section 2.05, the Revolving Loans made
--------------- ------------
by each Lender shall be evidenced by a single duly executed promissory note of
the Borrower to each applicable Lender in the face amount of its Revolving Loan
Commitment Percentage of the Revolving Committed Amount and in substantially the
form of Exhibit B-1 hereto.
-----------
(e) Maturity of Revolving Loans.
(i) The Revolving Loans shall mature on the Revolving Termination
Date, and any Revolving Loans, Swingline Loans and LOC Obligations then
outstanding (together with accrued interest thereon and fees in respect
thereof) shall be due and payable on such date.
40
(ii) If on any date the aggregate Revolving Outstandings exceed
the Revolving Committed Amount, the Borrower shall repay, and there shall
become due and payable (together with accrued interest thereon), on such
date an aggregate principal amount of Swingline Loans equal to such excess.
If the outstanding Swingline Loans have been repaid in full, the Borrower
shall prepay, and there shall become due and payable (together with accrued
interest thereon), Revolving Loans in such amounts as are necessary so
that, after giving effect to the repayment of the Swingline Loans and the
repayment of Revolving Loans, the aggregate Revolving Outstandings do not
exceed the Revolving Committed Amount.
(iii) If the outstanding Revolving Loans and Swingline Loans have
been repaid in full, the Borrower shall cash collateralize LOC Obligations
by depositing in the LOC Cash Collateral Account such amounts as are
necessary so that, after giving effect to the repayment of Swingline Loans
and Revolving Loans and the cash collateralization of LOC Obligations
pursuant to this subsection, the aggregate amount of Revolving Outstandings
do not exceed the Revolving Committed Amount. In determining the aggregate
Revolving Outstandings for purposes of this clause (iii), LOC Obligations
------------
shall be reduced to the extent that they are cash collateralized as
contemplated by this clause (iii).
------------
Each prepayment of Revolving Loans required pursuant to this subsection (e)
--------------
shall be applied ratably among outstanding Revolving Loans based on the
respective amounts of principal then outstanding. Each cash collateralization of
LOC Obligations required by this subsection (e) shall be applied ratably among
--------------
LOC Obligations based on the respective amounts thereof then outstanding.
Section 2.02 Letter of Credit Subfacility.
(a) Issuance and Continuation.
(i) Issuance. Subject to the terms and conditions hereof and of
--------
the LOC Documents, if any, and any other terms and conditions which an
Issuing Lender may reasonably require (so long as such terms and conditions
do not impose any financial obligation on or require any Lien (not
otherwise contemplated by this Agreement) to be given by a Credit Party or
conflict with any obligation of, or detract from any action which may be
taken by the Credit Parties or their Subsidiaries under this Agreement),
each Issuing Lender shall from time to time upon request issue, in Dollars,
and the LOC Participants shall participate in, letters of credit (the
"Letters of Credit") for the account of the Borrower or any of its
-----------------
Subsidiaries, from the Effective Date until the Revolving Termination Date,
in a form reasonably acceptable to the Issuing Lender; provided, however,
-------- -------
that (i) the aggregate amount of LOC Obligations shall not at any time
exceed $30,000,000 (the "LOC Committed Amount"), (ii) the aggregate amount
--------------------
of the Revolving Outstandings shall not exceed the Revolving Committed
Amount and (iii) with respect to each individual LOC Participant, the LOC
Participant's outstanding Revolving Loans plus its Participation Interests
in outstanding LOC Obligations plus its (other than the Swingline Lender)
Participation Interests in outstanding Swingline Loans shall not exceed
such LOC Participant's Revolving Commitment Percentage of the Revolving
Committed Amount. The issuance and expiry date of each Letter of Credit
shall be a Business Day. Except as otherwise expressly agreed upon by all
the LOC Participants, no Letter of Credit shall have an original expiry
date more than one year from the date of issuance, or as extended, shall
have an expiry date extending beyond the Revolving Termination Date. Each
Letter of Credit shall be either (x) a standby letter of credit issued to
support the obligations (including pension or insurance obligations),
contingent or otherwise, of the Borrower or any of its Subsidiaries, or (y)
a commercial letter of credit in respect of the purchase of goods or
services by the Borrower or any of its Subsidiaries in the
41
ordinary course of business; it being understood that any Letter of Credit
issued on behalf of a Foreign Subsidiary must be permitted by the terms of
Section 7.06. Each Letter of Credit shall comply with the related LOC
------------
Documents.
(ii) Continuation. On the Effective Date, each Issuing Lender
------------
that has issued an Existing Letter of Credit shall be deemed, without
further action by any party hereto, to have sold to each Revolving Lender,
and each such Revolving Lender shall be deemed, without further action by
any party hereto, to have purchased from each such Issuing Lender, without
recourse or warranty, an undivided participation interest in its Revolving
Commitment Percentage of such Existing Letter of Credit and the related LOC
Outstandings (although any fronting fee payable under Section 3.05(b)(iii)
--------------------
shall be payable directly to the Administrative Agent for the accounting of
each applicable Issuing Lender, and the Lenders (other than such Issuing
Lender) shall have no right to receive any portion of such fronting fee)
and any security therefor or guaranty pertaining thereto. On and after the
Effective Date, each Existing Letter of Credit shall constitute a Letter of
Credit for all purposes hereof.
(b) Notice and Reports. The request for the issuance of a Letter of
------------------
Credit (the "Letter of Credit Request") shall be submitted to the Issuing Lender
------------------------
in the form of Exhibit A-3 at least three Business Days prior to the requested
-----------
date of issuance or such shorter period as agreed to in writing by the Issuing
Lender. The Issuing Lender will, at least quarterly and more frequently upon
request, provide to the Administrative Agent for dissemination to the Revolving
Lenders a detailed report specifying the Letters of Credit which are then issued
and outstanding and any activity with respect thereto which may have occurred
since the date of the prior report, and including therein, among other things,
the account party, the beneficiary, the face amount, and the expiry date as well
as any payments or expirations which may have occurred. The Issuing Lender will
further provide to the Administrative Agent, promptly upon request, copies of
the Letters of Credit.
(c) Participations. Each LOC Participant, upon issuance of a Letter of
--------------
Credit, shall be deemed to have purchased without recourse a risk participation
from the Issuing Lender in such Letter of Credit and the obligations arising
thereunder and any collateral relating thereto, in each case in an amount equal
to its Revolving Commitment Percentage of the obligations under such Letter of
Credit, and shall absolutely, unconditionally and irrevocably assume, as primary
obligor and not as surety, and be obligated to pay to the Issuing Lender
therefor and discharge when due, its Revolving Commitment Percentage of the
obligations arising under such Letter of Credit. Without limiting the scope and
nature of each LOC Participant's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed as required hereunder or
under any such Letter of Credit, each such LOC Participant shall pay to the
Issuing Lender its Revolving Commitment Percentage of such unreimbursed drawing
in same day funds on the day of notification by the Issuing Lender of an
unreimbursed drawing pursuant to the provisions of subsection (d) hereof. The
--------------
obligation of each LOC Participant to so reimburse the Issuing Lender shall be
absolute and unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event. Any such
reimbursement shall not relieve or otherwise impair the obligation of the
Borrower or any other Credit Party to reimburse the Issuing Lender under any
Letter of Credit, together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of
-------------
Credit, the Issuing Lender will promptly notify the Borrower. Unless the
Borrower shall immediately notify the Issuing Lender of its intent to otherwise
reimburse the Issuing Lender, the Borrower shall be deemed to have requested a
Revolving Loan at the Adjusted Base Rate in the amount of the drawing as
provided in subsection (e) hereof, the proceeds of which will be used to satisfy
--------------
the reimbursement obligations. The Borrower shall be irrevocably and
unconditionally obligated forthwith to reimburse the Issuing Lender for any
amounts paid by such Issuing Lender upon any drawing under any Letter of Credit,
together with any
42
and all reasonable charges and expenses which the Issuing Lender may pay or
incur relative to such drawing and interest on the amount drawn at the rate
applicable to Revolving Base Rate Loans for each day from and including the date
such amount is drawn to but excluding the date such reimbursement payment is due
and payable. Such reimbursement payment shall be due and payable (i) at or
before 1:00 P.M. (local time in Charlotte, North Carolina) on such date the
Issuing Lender notifies the Borrower of such drawing, if such notice is given at
or 10:00 A.M. (local time in Charlotte, North Carolina) on such date or (ii)
otherwise at or before 1:00 P.M. (local time in Charlotte, North Carolina) on
the next succeeding Business Day; provided, that no payment otherwise required
--------
by this sentence to be made by the Borrower at or before 1:00 P.M. (local time
in Charlotte, North Carolina) on any day shall be overdue hereunder if
arrangements for such payment (including, without limitation, reimbursement with
the proceeds of a Revolving Borrowing pursuant to subsection (e) below)
--------------
satisfactory to the Issuing Lender have been made by the Borrower at or before
1:00 P.M. (local time in Charlotte, North Carolina) on such day and payment is
actually made not later than 1:00 P.M. (local time in Charlotte, North Carolina)
on such day. In addition, the Borrower agrees to pay to the Issuing Lender
interest, payable on demand, on any and all amounts not paid by the Borrower to
the Issuing Lender when due under this subsection (d), for each day from and
--------------
including the date when such amount becomes due to but excluding the date such
amount is paid in full, whether before or after judgment, at a rate per annum
equal to the sum of 2% plus the rate applicable to Revolving Base Rate Loans for
such day. Each payment to be made by the Borrower to the Issuing Lender pursuant
to this subsection (d) shall be made to the Issuing Lender in Federal or other
--------------
funds immediately available to it at its address referred to in Section 10.01.
-------------
The Borrower's reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of (but without waiver of)
any rights of set-off, counterclaim or defense to payment that the applicable
account party or the Borrower may claim or have against the Issuing Lender, the
Agents, the Lenders, the beneficiary of the Letter of Credit drawn upon or any
other Person, including without limitation, any defense based on any failure of
the applicable account party, the Borrower or any other Credit Party to receive
consideration or the legality, validity, regularity or unenforceability of the
Letter of Credit. The Issuing Lender will promptly notify the LOC Participants
of the amount of any unreimbursed drawing and each LOC Participant shall
promptly pay to the Administrative Agent for the account of the Issuing Lender,
in Dollars and in immediately available funds, the amount of such LOC
Participant's Revolving Commitment Percentage of such unreimbursed drawing. Such
payment shall be made on the day such notice is received by such Lender from the
Issuing Lender if such notice is received at or before 3:00 P.M. (local time in
Charlotte, North Carolina); otherwise such payment shall be made at or before
1:00 P.M. (local time in Charlotte, North Carolina) on the Business Day next
succeeding the day such notice is received. If such LOC Participant does not pay
such amount to the Issuing Lender in full upon such request, such LOC
Participant shall, on demand, pay to the Administrative Agent for the account of
the Issuing Lender interest on the unpaid amount during the period from the date
the LOC Participant received the notice regarding the unreimbursed drawing until
such LOC Participant pays such amount to the Issuing Lender in full at a rate
per annum equal to, if paid within two Business Days of the date of drawing, the
Federal Funds Rate and thereafter at a rate equal to the Base Rate. Each LOC
Participant's obligation to make such payment to the Issuing Lender, and the
right of the Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and without
regard to the termination of this Agreement or the Commitments hereunder, the
existence of a Default or an Event of Default or the acceleration of the
obligations hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever. Simultaneously with the making of each such
payment by a LOC Participant to the Issuing Lender, such LOC Participant shall,
automatically and without any further action on the part of the Issuing Lender
or such LOC Participant, acquire a participation in an amount equal to such
payment (excluding the portion of such payment constituting interest owing to
the Issuing Lender) in the related unreimbursed drawing portion of the LOC
Obligation and in the interest thereon and in the related LOC Documents, and
shall have a claim against the Borrower and the other Credit Parties with
respect thereto.
43
(e) Repayment with Revolving Loans. On any day on which the Borrower
------------------------------
shall have requested, or been deemed to have requested pursuant to Section
-------
2.02(d), a Revolving Borrowing to reimburse a drawing under a Letter of Credit,
-------
the Administrative Agent shall give notice to the applicable Lenders that a
Revolving Borrowing has been requested or deemed requested in connection with a
drawing under a Letter of Credit, in which case a Revolving Borrowing comprised
solely of Base Rate Loans (each such borrowing, a "Mandatory LOC Borrowing")
-----------------------
shall be immediately made from all Revolving Lenders (without giving effect to
any termination of the Commitments pursuant to Section 8.02 or otherwise) pro
------------
rata based on each Lender's respective Revolving Commitment Percentage and the
proceeds thereof shall be paid directly to the Issuing Lender for application to
the respective LOC Obligations. Each Revolving Lender hereby irrevocably agrees
to make such Revolving Loans immediately upon any such request or deemed request
on account of each such Mandatory LOC Borrowing in the amount and in the manner
specified in the preceding sentence and on the same such date notwithstanding
(i) the amount of Mandatory LOC Borrowing may not comply with the minimum amount
for borrowings of Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 4.02 are then satisfied, (iii) whether a Default
------------
or Event of Default then exists, (iv) failure of any such request or deemed
request for Revolving Loans to be made by the time otherwise required hereunder,
(v) the date of such Mandatory LOC Borrowing or (vi) any reduction in the
Revolving Committed Amount or any termination of the Commitments. In the event
that any Mandatory LOC Borrowing cannot for any reason be made on the date
otherwise required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower or any other Credit Party), then each such Lender hereby agrees that it
shall forthwith fund (as of the date the Mandatory LOC Borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower on or
after such date and prior to such purchase) its Participation Interest in the
outstanding LOC Obligations; provided, further, that in the event any Lender
--------
shall fail to fund its Participation Interest on the day the Mandatory LOC
Borrowing would otherwise have occurred, then the amount of such Lender's
unfunded Participation Interest therein shall bear interest payable to the
Issuing Lender upon demand, at the rate equal to, if paid within two Business
Days of such date, the Federal Funds Rate, and thereafter at a rate equal to the
Base Rate.
(f) Designation of Subsidiaries as Account Parties. Notwithstanding
----------------------------------------------
anything to the contrary set forth in this Agreement, a Letter of Credit issued
hereunder may contain a statement to the effect that such Letter of Credit is
issued for the account of a Subsidiary of the Borrower; provided, that
--------
notwithstanding such statement, the Borrower shall be the actual account party
for all purposes of this Credit Agreement for such Letter of Credit and such
statement shall not affect the Borrower's reimbursement obligations hereunder
with respect to such Letter of Credit.
(g) Modification and Extension. The issuance of any supplement,
--------------------------
modification, amendment, renewal, or extensions to any Letter of Credit shall,
for purposes hereof, be treated in all respects the same as the issuance of a
new Letter of Credit hereunder.
(h) Uniform Customs and Practices. Letters of Credit shall be governed
-----------------------------
by, and construed in accordance with, applicable laws as provided in Section
-------
10.11.
------
(i) Responsibility of Issuing Lender. It is expressly understood and
--------------------------------
agreed that the obligations of the Issuing Lender hereunder to the LOC
Participants are only those expressly set forth in this Agreement and that the
Issuing Lender shall be entitled to assume that the conditions precedent set
forth in Section 4.02 have been satisfied unless it shall have acquired actual
------------
knowledge that any such condition precedent has not been satisfied; provided,
--------
however, that nothing set forth in this Section 2.02 shall be deemed to
------- ------------
prejudice the right of any LOC Participant to recover from the Issuing Lender
any amounts made available by such LOC Participant to the Issuing Lender
pursuant to this Section 2.02 in
------------
44
the event that it is determined by a court of competent jurisdiction that the
payment with respect to a Letter of Credit constituted gross negligence or
willful misconduct on the part of the Issuing Lender.
(j) Conflict with LOC Documents. In the event of any conflict between
---------------------------
this Agreement and any LOC Document, this Agreement shall govern.
(k) Indemnification of Issuing Lender.
(i) In addition to their other obligations under this Agreement,
the Credit Parties hereby agree to protect, indemnify, pay and save the
Issuing Lender harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys' fees) that the Issuing Lender may incur or be subject
to as a consequence, direct or indirect, of (A) the issuance of any Letter
of Credit or (B) the failure of the Issuing Lender to honor a drawing under
a Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
Governmental Authority (all such acts or omissions, herein called
"Government Acts").
---------------
(ii) As between the Credit Parties and the Issuing Lender, the
Credit Parties shall assume all risks of the acts, omissions or misuse of
any Letter of Credit by the beneficiary thereof. The Issuing Lender shall
not be responsible for: (A) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (C) failure of the beneficiary of a
Letter of Credit to comply fully with conditions required in order to draw
upon a Letter of Credit; (D) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex
or otherwise, whether or not they be in cipher; (E) errors in
interpretation of technical terms; (F) any loss or delay in the
transmission or otherwise of any documents required in order to make a
drawing under a Letter of Credit or of the proceeds thereof; and (G) any
consequences arising from causes beyond the control of the Issuing Lender,
including, without limitation, any Government Acts. None of the above shall
affect, impair, or prevent the vesting of the Issuing Lender's rights or
powers hereunder.
(iii) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender, under or in connection with any Letter of Credit or the
related certificates, if taken or omitted in good faith, shall not put the
Issuing Lender under any resulting liability to the Borrower or any other
Credit Party. It is the intention of the parties that this Agreement shall
be construed and applied to protect and indemnify the Issuing Lender
against any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Credit Parties,
including, without limitation, any and all risks of the acts or omissions,
whether rightful or wrongful, of any present or future Government Acts. The
Issuing Lender shall not, in any way, be liable for any failure by the
Issuing Lender or anyone else to pay any drawing under any Letter of Credit
as a result of any Government Acts or any other cause beyond the control of
the Issuing Lender.
(iv) Nothing in this subsection (k) is intended to limit the
--------------
reimbursement obligation of the Borrower contained in this Section 2.02.
-------------
The obligations of the Borrower under this subsection (k) shall survive the
--------------
termination of this Agreement. No act or omission of any
45
current or prior beneficiary of a Letter of Credit shall in any way affect
or impair the rights of the Issuing Lender to enforce any right, power or
benefit under this Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (k), the Borrower shall have no obligation to indemnify the
--------------
Issuing Lender in respect of any liability incurred by the Issuing Lender
arising solely out of the (A) gross negligence or willful misconduct of the
Issuing Lender, as determined by a court of competent jurisdiction or (B)
the wrongful dishonor resulting from the gross negligence or willful
misconduct of the Issuing Lender of a proper demand for payment under any
Letter of Credit issued by it. Nothing in this Agreement shall relieve the
Issuing Lender of any liability to the Borrower in respect of any action
taken by the Issuing Lender which action constitutes gross negligence or
willful misconduct of the Issuing Lender or a violation of the UCP or
Uniform Commercial Code as applicable), as determined by a court of
competent jurisdiction.
(l) Cash Collateral. If the Borrower is required pursuant to the terms
---------------
of this Agreement or any other Credit Document to cash collateralize any LOC
Obligations, the Borrower shall deposit in an account (which may be the LOC Cash
Collateral Account) with the Collateral Agent an amount in cash equal to 100%
of such LOC Obligations. Such deposit shall be held by the Collateral Agent as
collateral for the payment and performance of the LOC Obligations. The
Collateral Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. The Collateral Agent will, at
the request of the Borrower, invest amounts deposited in such account in Cash
Equivalents; provided, however, that (i) amounts deposited in such account in
-------- -------
connection with any prepayment of Eurodollar Loans of any Class shall be
invested in Cash Equivalents that mature prior to the last day of the applicable
Interest Periods of the Eurodollar Loans of such Class to be prepaid, (ii) the
Collateral Agent shall not be required to make any investment that, in its sole
judgment, would require or cause the Collateral Agent to be in, or would result
in any, violation of any law, statute, rule or regulation, (iii) such Cash
Equivalents shall be subjected to a first priority perfected security interest
in favor of the Collateral Agent and (iv) if an Event of Default shall have
occurred and be continuing, the selection of such Cash Equivalents shall be in
the sole discretion of the Collateral Agent. The Borrower shall indemnify the
Collateral Agent for any losses relating to such investments in Cash
Equivalents. Other than any interest or profits earned on such investments, such
deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be
applied by the Collateral Agent to reimburse the Issuing Lender immediately for
drawings under Letters of Credit and, if the maturity of the Loans has been
accelerated, to satisfy the LOC Obligations. If the Borrower is required to
provide an amount of cash collateral hereunder as a result of an Event of
Default, such amount (to the extent not applied as aforesaid) shall be returned
to the Borrower within three Business Days after all Events of Default have been
cured or waived. If the Borrower is required to provide an amount of cash
collateral hereunder pursuant to Section 3.03(b)(i), such amount (to the extent
------------------
not applied as aforesaid) shall be returned to the Borrower upon demand;
provided that, after giving effect to such return, (i) the sum of the aggregate
--------
amount of outstanding LOC Obligations, plus the aggregate principal amount of
outstanding Revolving Loans, plus the aggregate principal amount of outstanding
Swingline Loans would not exceed the aggregate Revolving Committed Amount and
(ii) no Default or Event of Default shall have occurred and be continuing. If
the Borrower is required to deposit an amount of cash collateral hereunder
pursuant to Section 3.03(b)(ii), (iii), (iv), or (v), interest or profits
------------------- ----- ---- ---
thereon (to the extent not applied as aforesaid) shall be returned to the
Borrower after the full amount of such deposit has been applied by the
Collateral Agent to reimburse the Issuing Lender for drawings under Letters of
Credit. The Borrower hereby pledges and assigns to the Collateral Agent, for its
benefit and the benefit of the Lenders, the cash collateral account established
hereunder (and all monies and investments held therein) to secure the Credit
Obligations.
Section 2.03 Tranche A Term Loans.
--------------------
46
(a) Tranche A Term Loan Commitments. Subject to the terms and
-------------------------------
conditions set forth herein, each Lender severally agrees, on the Effective
Date, to make Tranche A Term Loans to the Borrower, in Dollars, in an aggregate
amount equal to such Lender's Tranche A Term Loan Commitment Percentage, if any,
of the Tranche A Term Loan Committed Amount; provided that the aggregate amount
--------
of the Tranche A Term Loan Borrowings made on the Effective Date shall not
exceed the applicable Tranche A Term Loan Committed Amount. Tranche A Term Loans
may consist of Base Rate Loans or Eurodollar Loans, or a combination thereof, as
the applicable Borrower may request; provided, however, that the Term Loans
-------- -------
outstanding at any time shall consist of not more than six separate Groups of
Eurodollar Loans. For purposes hereof, Eurodollar Loans with different Interest
Periods shall be considered as separate Groups of Eurodollar Loans, even if they
begin on the same date, although borrowings of Eurodollar Loans of any Class
may, in accordance with the provisions hereof, be combined through extensions or
conversions at the end of existing Interest Periods to constitute a single new
Group of Eurodollar Loans of such Class with the same Interest Period. Amounts
repaid on Tranche A Term Loans may not be reborrowed.
(b) Notice of Borrowing. The Borrower shall submit an appropriate
-------------------
Notice of Borrowing to the Administrative Agent not later than 12:00 noon (local
time in Charlotte, North Carolina) on the Effective Date, with respect to the
portion of the Tranche A Term Loans initially consisting of Base Rate Loans, or
1:00 P.M. (local time in Charlotte, North Carolina) on the third Business Day
prior to the Effective Date, with respect to the portion of the Tranche A Term
Loans initially consisting of one or more Eurodollar Loans, which Notice of
Borrowing shall be irrevocable and shall specify (i) that the funding of Tranche
A Term Loans is requested and (ii) whether the funding of Tranche A Term Loans
shall be comprised of Base Rate Loans, Eurodollar Loans or a combination
thereof, and if Eurodollar Loans are requested, the initial Interest Period
applicable thereto (which shall be subject to the definition of "Interest
Period"). If the Borrower shall fail to deliver a Notice of Borrowing to the
Administrative Agent by 1:00 P.M. (local time in Charlotte, North Carolina) on
the third Business Day prior to the Effective Date, then the full amount of the
Tranche A Term Loans shall be disbursed on the Effective Date as Base Rate
Loans. Thereafter, all or any portion of the Tranche A Term Loans may be
converted into Eurodollar Loans in accordance with the terms of Section 3.01(c)
---------------
and the definition of "Interest Period".
(c) Funding of Term Loans. On the Effective Date, each applicable
---------------------
Lender will make its Tranche A Term Loan Commitment Percentage of the Tranche A
Term Loan Committed Amount available to the Administrative Agent by deposit, in
Dollars and in immediately available funds, at the offices of the Administrative
Agent at its principal office in Charlotte, North Carolina or at such other
address as the Administrative Agent may designate in writing. Unless the
Administrative Agent determines that any applicable condition set forth in
Article IV has not been satisfied, the Administrative Agent shall make the
----------
amount of the funds so received available to the Borrower by crediting the
account of the Borrower on the books of such office of the Administrative Agent.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make a Tranche A Term Loan hereunder; provided,
--------
however, that the failure of any Lender to fulfill its obligations hereunder
-------
shall not relieve any other Lender of its obligations hereunder. If the
Administrative Agent shall have received an executed signature page to this
Agreement (whether an original or via telecopy) from a Lender, the
Administrative Agent may assume that such Lender has made or will make the
amount of its Tranche A Term Loans available to the Administrative Agent on the
Effective Date, and the Administrative Agent in reliance upon such assumption,
may (in its sole discretion but without any obligation to do so) make available
to the applicable Borrower a corresponding amount. If such corresponding amount
is not in fact made available to the Administrative Agent, the Administrative
Agent shall be able to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand
47
therefor, the Administrative Agent will promptly notify the Borrower, and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent shall also be entitled to recover from the
Lender or the Borrower, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such
corresponding amount is recovered by the Administrative Agent at a per annum
rate equal to (i) from the Borrower, the applicable rate for such Tranche A Term
Loan and (ii) from a Lender, the Federal Funds Rate if paid within two Business
Days of the date of drawing and thereafter at a rate equal to the Base Rate. If
such Lender shall repay to the Administrative Agent such corresponding amount,
such amount so repaid shall constitute such Lender's Tranche A Term Loan
included in the Tranche A Term Borrowing for purposes of this Agreement.
(d) Interest on Tranche A Term Loans. Subject to Section 3.01(a),
-------------------------------- ---------------
Tranche A Term Loans shall, at the option of the Borrower and except as
otherwise provided herein, be incurred and maintained as, or converted into, one
or more Base Rate Loans or Eurodollar Loans. During such period as the Tranche A
Term Loans shall be comprised in whole or in part of Base Rate Loans, such Base
Rate Loans shall bear interest at a rate per annum equal to the Adjusted Base
Rate. During such period as the Tranche A Term Loans shall be comprised in whole
or in part of Eurodollar Loans, such Eurodollar Loans shall bear interest at a
rate per annum equal to the Adjusted Eurodollar Rate. Interest on the Tranche A
Term Loans shall be payable in arrears on each applicable Interest Payment Date
(and at such other times as may be specified herein).
(e) Amortization of Tranche A Term Loans. On each Principal
------------------------------------
Amortization Payment Date set forth below, the Borrower shall repay, and there
shall become due and payable (together with accrued interest thereon), the
aggregate principal amount of Tranche A Term Loans set forth below opposite such
date, and the Tranche A Term Loans of each Lender shall be ratably repaid;
provided, that in any event all amounts shall be due and payable on the Tranche
--------
A Term Loan Maturity Date:
48
------------------------------------------------
TRANCHE A TERM LOAN TRANCHE A TERM LOAN
PRINCIPAL AMORTIZATION PRINCIPAL AMORTIZATION
PAYMENT DATES PAYMENT
------------------------------------------------
September 30, 2002 $ 3,000,000
------------------------------------------------
December 31, 2002 $ 3,000,000
------------------------------------------------
March 31, 2003 $ 3,000,000
------------------------------------------------
June 30, 2003 $ 3,250,000
------------------------------------------------
September 30, 2003 $ 3,250,000
------------------------------------------------
December 31, 2003 $ 3,250,000
------------------------------------------------
March 31, 2004 $ 3,250,000
------------------------------------------------
June 30, 2004 $ 4,000,000
------------------------------------------------
September 30, 2004 $ 4,000,000
------------------------------------------------
December 31, 2004 $ 4,000,000
------------------------------------------------
March 31, 2005 $ 4,000,000
------------------------------------------------
June 30, 2005 $ 4,500,000
------------------------------------------------
September 30, 2005 $ 4,500,000
------------------------------------------------
December 31, 2005 $ 4,500,000
------------------------------------------------
March 31, 2006 $ 4,500,000
------------------------------------------------
June 30, 2006 $ 5,500,000
------------------------------------------------
September 30, 2006 $ 5,500,000
------------------------------------------------
December 31, 2006 $ 5,500,000
------------------------------------------------
March 31, 2007 $ 5,500,000
------------------------------------------------
June 30,2007 $ 6,000,000
------------------------------------------------
September 30, 2007 $ 6,000,000
------------------------------------------------
TOTAL $90,000,000
------------------------------------------------
(f) Tranche A Term Loan Notes. Subject to Section 2.06, the Tranche A
------------------------- ------------
Term Loans of the applicable Class made by each Lender shall be evidenced by a
single duly executed promissory note of the Borrower to such Lender in an
original principal amount equal to such Lender's Tranche A Term Loan Commitment
Percentage of the Tranche A Term Loan Committed Amount and substantially in the
form of Exhibit B-2 hereto.
-----------
Section 2.04 Tranche B Term Loans.
--------------------
(a) Tranche B Term Loan Commitments. Subject to the terms and
-------------------------------
conditions set forth herein, each Lender severally agrees, on the Effective
Date, to make a term loan (collectively, the "Tranche B Term Loans") to the
--------------------
Borrower, in Dollars, in an aggregate amount equal to such Lender's Tranche B
Term Loan Commitment Percentage, if any, of the applicable Tranche B Term Loan
Committed Amount; provided that the aggregate amount of the Tranche B Term Loan
--------
Borrowings made on the Effective Date shall not exceed the Tranche B Term Loan
Committed Amount. Tranche B Term Loans may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower may request;
provided, however, that the Term Loans outstanding at any time shall consist of
-------- -------
not more than six separate Groups of Eurodollar Loans. For purposes hereof,
Eurodollar Loans with different Interest Periods shall be considered as separate
Groups of Eurodollar Loans, even if they begin on the same date, although
borrowings of Eurodollar Loans of any Class may, in accordance with the
provisions hereof, be combined through extensions or conversions at the end of
existing Interest Periods to constitute
49
a single new Group of Eurodollar Loans of such Class with the same Interest
Period. Amounts repaid on Tranche B Term Loans may not be reborrowed.
(b) Notice of Borrowing. The Borrower shall submit an appropriate
-------------------
Notice of Borrowing to the Administrative Agent not later than 12:00 noon (local
time in Charlotte, North Carolina) on the Effective Date, with respect to the
portion of the Tranche B Term Loans initially consisting of Base Rate Loans, or
1:00 P.M. (local time in Charlotte, North Carolina) on the third Business Day
prior to the Effective Date, with respect to the portion of the Tranche B Term
Loans initially consisting of one or more Eurodollar Loans, which Notice of
Borrowing shall be irrevocable and shall specify (i) that the funding of Tranche
B Term Loans is requested and (ii) whether the funding of Tranche B Term Loans
shall be comprised of Base Rate Loans, Eurodollar Loans or a combination
thereof, and if Eurodollar Loans are requested, the initial Interest Period
applicable thereto (which shall be subject to the definition of "Interest
Period"). If the Borrower shall fail to deliver a Notice of Borrowing to the
Administrative Agent by 1:00 P.M. (local time in Charlotte, North Carolina) on
the third Business Day prior to the Effective Date, then the full amount of the
Tranche B Term Loans shall be disbursed on the Effective Date as Base Rate
Loans. Thereafter, all or any portion of the Tranche B Term Loans may be
converted into Eurodollar Loans in accordance with the terms of Section 3.01(c)
---------------
and the definition of "Interest Period".
(c) Funding of Term Loans. On the Effective Date, each applicable
---------------------
Lender will make its Tranche B Term Loan Commitment Percentage of the Tranche B
Term Loan Committed Amount available to the Administrative Agent by deposit, in
Dollars and in immediately available funds, at the offices of the Administrative
Agent at its principal office in Charlotte, North Carolina or at such other
address as the Administrative Agent may designate in writing. Unless the
Administrative Agent determines that any applicable condition set forth in
Article IV has not been satisfied, the Administrative Agent shall make the
----------
amount of the funds so received available to the Borrower by crediting the
account of the Borrower on the books of such office of the Administrative Agent.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make a Tranche B Term Loan hereunder; provided,
--------
however, that the failure of any Lender to fulfill its obligations hereunder
-------
shall not relieve any other Lender of its obligations hereunder. If the
Administrative Agent shall have received an executed signature page to this
Agreement (whether an original or via telecopy) from a Lender, the
Administrative Agent may assume that such Lender has made or will make the
amount of its Tranche B Term Loans available to the Administrative Agent on the
Effective Date, and the Administrative Agent in reliance upon such assumption,
may (in its sole discretion but without any obligation to do so) make available
to the Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent, the Administrative Agent shall
be able to recover such corresponding amount from such Lender. If such Lender
does not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the Borrower, and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent at a per
annum rate equal to (i) from the Borrower, the applicable rate for such Tranche
B Term Loan and (ii) from a Lender, the Federal Funds Rate if paid within two
Business Days of the date of drawing and thereafter at a rate equal to the Base
Rate. If such Lender shall repay to the Administrative Agent such corresponding
amount, such amount so repaid shall constitute such Lender's Tranche B Term Loan
included in the Tranche B Term Borrowing for purposes of this Agreement.
50
(d) Interest on Tranche B Term Loans. Subject to Section 3.01(a),
-------------------------------- ---------------
Tranche B Term Loans shall, at the option of the Borrower and except as
otherwise provided herein, be incurred and maintained as, or converted into, one
or more Base Rate Loans or Eurodollar Loans. During such period as the Tranche B
Term Loans shall be comprised in whole or in part of Base Rate Loans, such Base
Rate Loans shall bear interest at a rate per annum equal to the Adjusted Base
Rate. During such period as the Tranche B Term Loans shall be comprised in whole
or in part of Eurodollar Loans, such Eurodollar Loans shall bear interest at a
rate per annum equal to the Adjusted Eurodollar Rate. Interest on the Tranche B
Term Loans shall be payable in arrears on each applicable Interest Payment Date
(and at such other times as may be specified herein).
(e) Amortization of Tranche B Term Loans. On each Principal
------------------------------------
Amortization Payment Date set forth below, the Borrower shall repay, and there
shall become due and payable (together with accrued interest thereon), the
aggregate principal amount of Tranche B Term Loans set forth below opposite such
date, and the Tranche B Term Loans of each Lender shall be ratably repaid:
------------------------------------------------
TRANCHE B TERM LOAN TRANCHE B TERM LOAN
PRINCIPAL AMORTIZATION PRINCIPAL AMORTIZATION
PAYMENT DATES PAYMENT
------------------------------------------------
September 30, 2002 $ 766,666
------------------------------------------------
December 31, 2002 $ 766,667
------------------------------------------------
March 31, 2003 $ 766,667
------------------------------------------------
June 30, 2003 $ 575,000
------------------------------------------------
September 30, 2003 $ 575,000
------------------------------------------------
December 31, 2003 $ 575,000
------------------------------------------------
March 31, 2004 $ 575,000
------------------------------------------------
June 30, 2004 $ 575,000
------------------------------------------------
September 30, 2004 $ 575,000
------------------------------------------------
December 31, 2004 $ 575,000
------------------------------------------------
March 31, 2005 $ 575,000
------------------------------------------------
June 30, 2005 $ 575,000
------------------------------------------------
September 30, 2005 $ 575,000
------------------------------------------------
December 31, 2005 $ 575,000
------------------------------------------------
March 31, 2006 $ 575,000
------------------------------------------------
June 30, 2006 $ 575,000
------------------------------------------------
September 30, 2006 $ 575,000
------------------------------------------------
December 31, 2006 $ 575,000
------------------------------------------------
March 31, 2007 $ 575,000
------------------------------------------------
June 30, 2007 $ 575,000
------------------------------------------------
September 30, 2007 $ 575,000
------------------------------------------------
December 31, 2007 $ 6,512,500
------------------------------------------------
March 31, 2008 $ 6,512,500
------------------------------------------------
June 30, 2008 $ 7,512,500
------------------------------------------------
September 30, 2008 $ 7,512,500
------------------------------------------------
December 31, 2008 $ 7,512,500
------------------------------------------------
March 31, 2009 $181,787,500
------------------------------------------------
TOTAL $230,000,000
------------------------------------------------
51
(f) Tranche B Term Loan Notes. Subject to Section 2.06, the Tranche B
------------------------- ------------
Term Loans made by each Lender shall be evidenced by a single duly executed
promissory note of the Borrower to such Lender in an original principal amount
equal to such Lender's Tranche B Term Loan Commitment Percentage of the Tranche
B Term Loan Committed Amount and substantially in the form of Exhibit B-3
-----------
hereto.
Section 2.05 Swingline Subfacility.
---------------------
(a) Swingline Commitment. The Swingline Lender agrees, on the terms
--------------------
and subject to the conditions set forth herein and in the other Credit
Documents, to make loans to the Borrower in Dollars at any time and from time to
time during the period from and including the Effective Date to but not
including the Revolving Termination Date (each such loan, a "Swingline Loan" and
--------------
collectively, the "Swingline Loans"); provided that (i) the aggregate principal
--------------- --------
amount of the Swingline Loans outstanding at any one time shall not exceed the
Swingline Committed Amount, (ii) with regard to each Lender individually (other
than the Swingline Lender), such Lender's outstanding Revolving Loans plus its
Participation Interests in outstanding Swingline Loans plus its Participation
Interests in outstanding LOC Obligations shall not at any time exceed such
Lender's Revolving Commitment Percentage of the Revolving Committed Amount and
(iii) with regard to the Revolving Lenders collectively, the sum of the
aggregate principal amount of Swingline Loans outstanding plus the aggregate
amount of Revolving Loans outstanding plus the aggregate amount of LOC
Obligations outstanding shall not exceed the Revolving Committed Amount.
Swingline Loans shall be made and maintained as Base Rate Loans, and may be
repaid and reborrowed in accordance with the provisions hereof prior to the
Revolving Termination Date.
(b) Method of Borrowing and Funding Swingline Loans. The Borrower
-----------------------------------------------
shall request, a Swingline Loan by written notice (or telephone notice promptly
confirmed in writing) substantially in the form of Exhibit A-4 hereto (a
-----------
"Swingline Loan Request") to the Swingline Lender not later than 1:00 P.M.
----------------------
(local time in Charlotte, North Carolina) on the Business Day of the requested
Swingline Loan. Each such notice shall be irrevocable and shall specify (i) that
a Swingline Loan is requested, (ii) the date of the requested Swingline Loan
(which shall be a Business Day) and (iii) the principal amount of the Swingline
Loan requested. Each Swingline Loan shall be made as a Base Rate Loan and,
subject to subsection (c) below shall have such maturity date as agreed to by
--------------
the Swingline Lender and the Borrower upon receipt by the Swingline Lender of
the Swingline Loan Request from the Borrower. The Swingline Lender shall
initiate the transfer of funds representing the Swingline Loan to the Borrower
by 3:00 P.M. (local time in Charlotte, North Carolina) on the Business Day of
the requested Swingline Borrowing. Each Swingline Loan shall be in a minimum
principal amount of $100,000 or any larger integral multiple of $50,000 (or the
then remaining amount of the Swingline Committed Amount, if less).
(c) Repayment and Participations of Swingline Loans. The principal
-----------------------------------------------
amount of all Swingline Loans shall be due and payable on the earliest of (i)
the maturity date agreed to by the Swingline Lender and the Borrower with
respect to such Swingline Loan (which maturity date shall not be a date more
than 14 Business Days from the date of advance thereof); (ii) the Revolving
Termination Date, (iii) the occurrence of a Bankruptcy Event with respect to the
Borrower or any other Credit Party or (iv) the acceleration of any Loan or the
termination of the Revolving Commitments pursuant to Section 8.02. If the
------------
Swingline Loans are not paid when due, the Swingline Lender (or the
Administrative Agent on its behalf) may, by notice to the Revolving Lender
(including the Swingline Lender in its capacity as a Revolving Lender), require
each Revolving Lender to pay to the Swingline Lender an amount equal to such
Revolving Lender's Revolving Commitment Percentage of the aggregate unpaid
principal amount of the Swingline Loans then outstanding. Such notice shall
specify the date on which such payments are to
52
be made, which shall be the first Business Day after such notice is given. Not
later than 12:00 Noon (local time in Charlotte, North Carolina) on the date so
specified, each Revolving Lender shall pay the amount so notified to it to the
Swingline Lender at its address referred to in Section 10.01, or at such other
-------------
address as the Swingline Lender may designate in Federal or other funds
immediately available in Charlotte, North Carolina. The amount so paid by each
Revolving Lender shall constitute a Revolving Base Rate Loan to the Borrower,
and the aggregate of such Revolving Base Rate Loans shall be referred to herein
as a "Mandatory Swingline Borrowing"; provided that if the Revolving Lenders are
----------------------------- --------
prevented from making such Revolving Loans to the Borrower by reason of the
provisions of the Bankruptcy Code or otherwise, the amount so paid by each
Revolving Lender shall constitute a purchase by it from the Swingline Lender,
without recourse or warranty, of an undivided participation interest in the
unpaid principal amount of the Swingline Loans (and interest accruing thereon
after the date of such payment) as shall be necessary to cause such Revolving
Lender to share in such Swingline Loans ratably based on its Revolving
Commitment Percentage (determined before giving effect to any termination of the
Commitments pursuant to Section 8.02); provided that (i) all interest payable on
------------ --------
the Swingline Loans shall be for the account of the Swingline Lender until the
date as of which the respective Participation Interest is funded and (ii) if
such Participation Interest is not funded on the date such purchase is deemed to
have occurred, the purchasing Lender shall pay to the Swingline Lender interest
on the unfunded portion of such Participation Interest at a rate per annum equal
to, if paid within two Business Days of the date such purchase is deemed to have
occurred, the Federal Funds Rate, and thereafter, the Base Rate. Each Revolving
Lender's obligation to make such payment to the Swingline Lender under this
subsection (c) shall be absolute and unconditional and shall not be affected by
--------------
any circumstance, including (without limitation) (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Lender or any other
Person may have against the Swingline Lender or the Borrower, (ii) the
occurrence or continuance of a Default or an Event of Default or the termination
or reduction in the amount of the Revolving Commitments after any such Swingline
Loans were made, (iii) any adverse change in the condition (financial or
otherwise) of the Borrower or any other Person, (iv) any breach of this
Agreement or any other Loan Document by Holdings, the Parent, the Borrower or
any other Lender, (v) whether any condition specified in Article IV is then
----------
satisfied or (vi) any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing. If such Lender does not pay such amount
forthwith upon the Swingline Lender's demand therefor, and until such time as
such Lender makes the required payment, the Swingline Lender shall be deemed to
continue to have outstanding Swingline Loans in the amount of such unpaid
participation obligation for all purposes of the Credit Documents other than
those provisions requiring the other Lenders to purchase a participation
therein. Further, such Lender shall be deemed to have assigned any and all
payments made of principal and interest on its Loans, and any other amounts due
to it hereunder to the Swingline Lender to fund Swingline Loans in the amount of
the participation in Swingline Loans that such Lender failed to purchase
pursuant to this Section 2.05(c) until such amount has been purchased (as a
---------------
result of such assignment or otherwise).
(d) Swingline Note. The Swingline Loans made by the Swingline Lender
--------------
shall be evidenced by a duly executed promissory note of the Borrower to the
Swingline Lender in the face amount of the Swingline Committed Amount and in
substantially the form of Exhibit B-3 hereto.
-----------
Section 2.06 Certain Provisions Pertinent to Notes.
(a) Notes for Loans of Different Types. Each Lender may, by notice to
----------------------------------
the Borrower and the Administrative Agent, request that each of its Loans of a
particular Type be evidenced by separate Notes in an amount equal to the
aggregate unpaid principal amount of such Loans. Each such Note shall be in
substantially the form of Exhibit ▇-▇, ▇-▇ or B-3 hereto with appropriate
----------- --- ---
modifications to reflect the fact that it evidences solely Loans of the relevant
Type. Each reference in this Agreement to such Lender's "Note" of a particular
Class shall be deemed to refer to and include any or all of such Notes, as the
context may require.
53
(b) Distribution of Notes; Records of Amounts Due. Upon receipt of
---------------------------------------------
each Lender's Note or Notes pursuant to Section 4.01(a), the Administrative
---------------
Agent shall forward such Note or Notes to such Lender. Each Lender shall record
the date, amount, Class and Type of each Loan made by it and the date and amount
of each payment of principal made by the Borrower with respect thereto, and may,
if such Lender so elects in connection with any transfer or enforcement of any
Note, endorse on the reverse side or on the schedule, if any, forming a part
thereof appropriate notations to evidence the foregoing information with respect
to each outstanding Loan evidenced thereby; provided that the failure of any
--------
Lender to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under any such Note. Each Lender is
hereby irrevocably authorized by the Borrower so to endorse each of its Notes
and to attach to and make a part of each of its Notes a continuation of any such
schedule as and when required.
ARTICLE III
PROVISIONS GENERALLY APPLICABLE
TO CREDIT FACILITIES
Section 3.01 Interest.
--------
(a) Rate Options Applicable to Loans. Each Borrowing shall be
--------------------------------
comprised of Base Rate Loans or (except in the case of Swingline Loans which
shall be made and maintained as Base Rate Loans) Eurodollar Loans, as the
Borrower may request pursuant to Section 2.01(b), 2.03(b) or 2.04(b). Borrowings
--------------- ------- -------
of more than one Type may be outstanding at the same time; provided, however,
-------- -------
that the Borrower may not request any Borrowing that, if made, would result in a
number of Groups of Eurodollar Loans being outstanding hereunder at any one time
exceeding the maximum number of Groups of Eurodollar Loans specified for Loans
of a Class in Sections 2.01(a), 2.03(a) or 2.04(a), as applicable. For this
---------------- ------- -------
purpose, Loans having different Interest Periods, regardless of whether
commencing on the same date, shall be considered separate Groups.
(b) Base Rate Loans. Each Loan of a Class which is made as, or
---------------
converted into, a Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made as, or
converted into, a Base Rate Loan until it becomes due or is converted into a
Loan of any other Type, at a rate per annum equal to the Adjusted Base Rate for
such day. Such interest shall be payable quarterly in arrears on each Interest
Payment Date and, with respect to the principal amount of any Base Rate Loan
converted to a Eurodollar Loan, on the date such Base Rate Loan is so converted.
Any overdue principal of or interest on any Base Rate Loan of any Class shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the rate otherwise applicable to Base Rate Loans of
the same Class for such day.
(c) Eurodollar Loans. Each Eurodollar Loan of a Class and Type shall
----------------
bear interest on the outstanding principal amount thereof, for each day during
the Interest Period applicable thereto, at a rate per annum equal to the
Adjusted Eurodollar Rate for such Interest Period; provided that if any
--------
Eurodollar Loan or any portion thereof shall, as a result of clause (iii) of the
------------
definition of Interest Period, have an Interest Period of less than one month,
such portion shall bear interest during such Interest Period at the rate
applicable to Base Rate Loans of the same Class during such period. Such
interest shall be payable each Interest Period on each Interest Payment Date.
Any overdue principal of or interest on any Eurodollar Loan of any Class shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the higher of (i) the sum of (A) the Eurodollar Rate
applicable to such Loan at the date such payment was due plus (B) the Applicable
Margin for Loans of such Class and Type for such day and (ii) the Applicable
Margin for Loans of such Class for such day plus the quotient obtained (rounded
upward, if necessary, to the nearest 1/100th of 1%) by dividing (A) the London
Interbank Offered Rate for one day (or, if such amount due remains unpaid more
than three Business
54
Days, then for such other period of time not longer than six months as the
Administrative Agent may select) deposits in Dollars in an amount approximately
equal to such overdue payment by (B) 1.00 minus the Eurodollar Reserve
Percentage (or, if the circumstances described in Section 3.07 shall exist, at a
------------
rate per annum equal to the sum of 2% plus the rate applicable to Base Rate
Loans of the same Class for such day).
(d) Determination and Notice of Interest Rates. The Administrative
------------------------------------------
Agent shall determine each interest rate applicable to the Loans hereunder. The
Administrative Agent shall give prompt notice to the Borrower and the
participating Lenders of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error. Any
notice with respect to Eurodollar Loans shall, without the necessity of the
Administrative Agent so stating in such notice, be subject to the provisions of
the definition of "Applicable Percentage" providing for adjustments in the
Applicable Percentage applicable to such Loans after the beginning of the
Interest Period applicable thereto. When during an Interest Period any event
occurs that causes an adjustment in the Applicable Percentage applicable to
Loans to which such Interest Period is applicable, the Administrative Agent
shall give prompt notice to the Borrower and the Lenders of such event and the
adjusted rate of interest so determined for such Loans, and its determination
thereof shall be conclusive in the absence of manifest error.
(e) Default Interest. Upon the occurrence and during the continuance
----------------
of an Event of Default, the principal of and, to the extent permitted by law,
interest on the Loans and any other amounts owing herein or under the other
Credit Documents shall bear interest, payable on demand, at a per annum rate
equal to (i) in the case of principal of any Loan, the rate otherwise applicable
to such Loan during such period pursuant to this Section 3.01 plus 2.00%
------------
(without duplication of any amount owing in respect of Base Rate Loans under the
third sentence of Section 3.01(b) or in respect of Eurodollar Loans under the
--------------
third sentence of Section 3.01(c)), (ii) in the case of interest on any Loan the
---------------
Base Rate plus the Applicable Percentage for Loans of such Class on such day
plus 2.00% and (iii) in the case of any other amount, the Base Rate plus the
Applicable Percentage for Revolving Base Rate Loans plus 2.00%.
Section 3.02 Extension and Conversion. The Loans included in each
------------------------
Borrowing shall bear interest initially at the type of rate specified by the
Borrower in the applicable Notice of Borrowing. Thereafter, the Borrower shall
have the option, on any Business Day, to extend existing Eurodollar Loans for a
subsequent permissible Interest Period or to convert Loans into Loans of another
Type; provided, however, that (i) except pursuant to Section 3.08, Eurodollar
-------- ------- ------------
Loans may be converted into Base Rate Loans only on the last day of the Interest
Period applicable thereto, (ii) Eurodollar Loans may be extended, and Base Rate
Loans may be converted into Eurodollar Loans, only if no Default or Event of
Default is in existence on the date of extension or conversion, (iii) Loans
extended as, or converted into, Eurodollar Loans shall be subject to the terms
of the definition of "Interest Period" set forth in Section 1.01 and shall be in
--------------- ------------
such minimum amounts as provided in, with respect to Revolving Loans, Section
-------
2.01(b) and, with respect to Tranche A Term Loans and Tranche B Term Loans, in a
-------
minimum aggregate principal amount of $2,000,000 and integral multiples of
$500,000 in excess thereof, (iv) the total number of Groups of Eurodollar Loans
of any Class outstanding at any time shall be no greater than the maximum number
provided in, with respect to Revolving Loans, Section 2.01(a) with respect to
---------------
Tranche A Term Loans, Section 2.03(a) and, with respect to Tranche B Term Loans,
---------------
Section 2.04(a), (it being understood that, for purposes hereof, Eurodollar
---------------
Loans with different Interest Periods shall be considered as separate Groups of
Eurodollar Loans, even if they begin on the same date, although borrowings of
any Class may, in accordance with the provisions hereof, be combined through
extensions or conversions at the end of existing Interest Periods to constitute
a single new Group of Eurodollar Loans of such Class with the same Interest
Period), (v) any request for extension or conversion of a Eurodollar Loan which
shall fail to specify an Interest Period shall be deemed to be a request for an
Interest Period of one month and (vi) Swingline Loans may not be extended or
converted pursuant to this Section 3.02.
------------
55
Each such extension or conversion shall be effected by the Borrower by giving a
Notice of Extension/Conversion (or telephonic notice promptly confirmed in
writing) to the office of the Administrative Agent specified in or pursuant to
Section 10.01, or at such other office as the Administrative Agent may designate
-------------
in writing, prior to 1:00 P.M. (local time in Charlotte, North Carolina) on the
Business Day of, in the case of the conversion of a Eurodollar Loan into a Base
Rate Loan, and on the third Business Day prior to, in the case of the extension
of a Eurodollar Loan as, or conversion of a Base Rate Loan into, a Eurodollar
Loan, the date of the proposed extension or conversion, specifying the date of
the proposed extension or conversion, the Loans to be so extended or converted,
the types of Loans into which such Loans are to be converted and, if
appropriate, the applicable Interest Periods with respect thereto. Each request
for extension or conversion shall be irrevocable and shall constitute a
representation and warranty by the Borrower of the matters specified in
subsections (b), (c), (d), and (e) of Section 4.02. If the Borrower fails to
--------------- --- --- --- ------------
request an extension or conversion of any Eurodollar Loan in accordance with
this Section 3.02 or any such requested conversion or extension is not permitted
------------
by this Agreement, then such Eurodollar Loan shall be automatically converted
into a Base Rate Loan at the end of the Interest Period applicable thereto. The
Administrative Agent shall give each affected Lender notice as promptly as
practicable of any such proposed extension or conversion of any Loan. Each
extension or conversion shall be effected by each Lender and the Administrative
Agent by recording for the account of such Lender the new Loan of such Lender
resulting from such extension or conversion and reducing the Loan (or portion
thereof) of such Lender being extended or converted by an equivalent principal
amount. Accrued interest on a Loan (or portion thereof) being extended or
converted shall be paid by the applicable Borrower (i) with respect to any Base
Rate Loan being converted to a Eurodollar Loan, on the last day of the first
fiscal quarter of the Borrower ending on or after the date of conversion and
(ii) otherwise, on the date of extension or conversion.
Section 3.03 Prepayments.
-----------
(a) Voluntary Prepayments. The Borrower shall have the right to prepay
---------------------
Loans in whole or in part from time to time, subject to Section 3.11 but
------------
otherwise without premium or penalty; provided, however, that (i) each partial
-------- -------
prepayment of Loans shall be in a minimum principal amount of $2,000,000 and
integral multiples of $500,000 in excess thereof, (ii) the Borrower shall have
given prior written or telecopy notice (or telephone notice promptly confirmed
by written or telecopy notice) to the Administrative Agent, in the case of any
Revolving Loan which is a Base Rate Loan or any Swingline Loan, by 12:00 noon
(local time in Charlotte, North Carolina), on the date of prepayment and, in the
case of any other Loan, by 12:00 noon (local time on Charlotte, North Carolina),
at least three Business Days prior to the date of prepayment and (iii) voluntary
prepayments of Term Loans under this Section 3.03(a) shall be applied ratably to
---------------
the Tranche A Term Loans and the Tranche B Term Loans (in each case ratably to
the remaining Principal Amortization Payments thereof). Each notice of
prepayment shall specify the prepayment date, the principal amount to be
prepaid, whether the Loan to be prepaid is a Revolving Loan, Tranche A Term
Loan, Tranche B Term Loan or Swingline Loan, whether the Loan to be prepaid is a
Eurodollar Loan or a Base Rate Loan and, in the case of a Eurodollar Loan, the
Interest Period of such Loan. Each notice of prepayment shall be irrevocable and
shall commit the Borrower to prepay such Loan by the amount stated therein on
the date stated therein. Subject to the foregoing, amounts prepaid under this
Section 3.03(a) shall be applied as the Borrower may elect; provided that if the
--------------- --------
Borrower fails to specify the application of a voluntary prepayment then such
prepayment shall be applied first to Revolving Loans, then to Swingline Loans
and then to the Tranche A Term Loans and the Tranche B Term Loans (in each case
ratably to the remaining Principal Amortization Payments thereof), in each case
first to Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period. All prepayments under this Section 3.03(a) shall be accompanied
--------------
by accrued interest on the principal amount being prepaid to the date of
payment. Notwithstanding the foregoing, the Borrower may elect to cause all or a
portion of any such prepayment of the Term Loans to be applied in direct order
of maturity so long as, at the time of any such prepayment applied in direct
order of maturity and after giving effect thereto,
56
no more than the next four Principal Amortization Payments of either the Tranche
A Term Loans or the Tranche B Term Loans due under Section 2.03(e) or 2.04(e),
--------------- -------
as applicable, have been prepaid.
(b) Mandatory Prepayments.
---------------------
(i) Revolving Committed Amount. If at any time, the Revolving
--------------------------
Outstandings shall exceed the Revolving Committed Amount at such time, the
Borrower immediately shall prepay the Revolving Loans, prepay the Swingline
Loans and/or cash collateralize or pay the LOC Obligations, in an aggregate
amount sufficient to eliminate such excess.
(ii) Excess Cash Flow. Within 90 days after the end of each
----------------
fiscal year of the Borrower (commencing with the fiscal year ending
December 31, 2002), the Borrower shall prepay the Loans and/or cash
collateralize or pay the LOC Obligations in an amount equal to (i) 75% of
Excess Cash Flow for such prior fiscal year, in the case of the fiscal year
ending December 31, 2002, or (ii) 50% of the Excess Cash Flow for such
prior fiscal year, in the case of each fiscal year ending after December
31, 2002.
(iii) Asset Dispositions. Immediately upon receipt by any
------------------
Consolidated Party of proceeds from any Asset Disposition (other than any
Excluded Asset Disposition), the Borrower shall prepay the Loans and/or
cash collateralize or pay the LOC Obligations in an aggregate amount equal
to 100% of the Net Cash Proceeds of such Asset Disposition.
(iv) Debt Issuances. Immediately upon receipt by any Consolidated
--------------
Party of proceeds from any Debt Issuance (other than any Excluded Debt
Issuance), the Borrower shall prepay the Loans and/or cash collateralize
the LOC Obligations in an aggregate amount equal to 100% of the Net Cash
Proceeds of such Debt Issuance.
(v) Equity Issuances. Immediately upon receipt by any
----------------
Consolidated Party of proceeds from any Equity Issuance (other than any
Excluded Equity Issuance), the Borrower shall prepay the Loans and/or cash
collateralize the LOC Obligations in an aggregate amount equal to 50% of
the Net Cash Proceeds of such Equity Issuance.
(vi) Application of Mandatory Prepayments. All amounts required
------------------------------------
to be paid pursuant to this Section 3.03(b) shall be applied as follows:
---------------
(A) with respect to all amounts paid pursuant to Section
-------
3.03(b)(i), first to Revolving Loans, second to Swingline Loans and
---------- ------
third to cash collateralize LOC Obligations;
-----
(B) subject to subsection (vii) and clause (C) below, with
---------------- ----------
respect to all amounts paid pursuant to Section 3.03(b)(ii), (iii),
------------------- -----
(iv) or (v), (1) first, to the Tranche A Term Loans and the Tranche B
---- ---
Term Loans (ratably to the remaining Principal Amortization Payments
thereof) and (2) second, to (x) the Revolving Loans (with a
------
corresponding reduction in the Revolving Committed Amount pursuant to
Section 3.04(b)), (y) then to Swingline Loans (with a corresponding
--------------- ----
reduction in the Revolving Committed Amount and the Swingline
Committed Amount pursuant to Section 3.04(b)) and (z) then to cash
--------------- ----
collateralize LOC Obligations; and
(C) with respect to each amount in excess of $10,000,000
paid pursuant to Section 3.03(b)(iii), pro-rata (based on the
--------------------
Revolving Committed ▇▇▇▇▇▇,
▇▇
the outstanding principal amount of the Term A Loans and the
outstanding principal amount of the Term B Loans) between (1)
Revolving Outstandings (in the order set forth in clause (B)(2)(x),(y)
--------------------
and (z) above) and (2) the Term A Loans and the Term B Loans (ratably
---
to the remaining Principal Amortization Payments thereof).
Notwithstanding the foregoing, any holder of Tranche B Term Loans may
elect, subject to the limitations set forth below, to decline all or a
portion of any mandatory prepayment of Tranche B Term Loans of such Lender
pursuant to Section 3.03(b)(ii), (iii), (iv) or (v), provided that (x)
------------------- ----- ---- --- --------
such holder shall have given written or telecopy notice to the
Administrative Agent (or telephone notice promptly confirmed in written or
telecopy notice) at least one Business Day prior to the date on which such
prepayment is proposed to be made by the Borrower as set forth in the
notice from the Borrower pursuant to Section 3.03(b)(ix), and (y) after
-------------------
giving effect to any concurrent prepayment of Tranche A Term Loans pursuant
to Section 3.03(b)(ii), (iii), (iv) or (v), the Tranche A Term Loans shall
------------------- ----- ---- ---
not have been paid in full. Any such notice from a holder of Tranche B Term
Loans shall set forth the percentage that such holder has elected to
decline of the prepayment which such holder would otherwise receive
pursuant to this Section 3.03(b). In the event that any such election is
---------------
made, the aggregate amount of the prepayment which holders of Tranche B
Term Loans shall have elected to decline shall be applied, first, to prepay
-----
Tranche A Term Loans (ratably to the remaining Principal Amortization
Payments thereof) and, second, after the Tranche A Term Loans have been
------
paid in full, to the Tranche B Term Loans held by each Lender which elected
to decline any portion of such mandatory prepayment (ratably to the
remaining Principal Amortization Payments thereof), pro rata according to
the amount of such prepayment which each such holder elected to decline.
(vii) Order of Applications. All amounts allocated to Revolving
---------------------
Outstandings as provided in this subsection shall be applied, first, to
-----
Revolving Loans, second, after all Revolving Loans have been repaid, to
------
Swingline Loans, and third, after all Swingline Loans have been repaid, to
-----
cash collateralize or pay the LOC Obligations; provided that any balance of
--------
such amounts remaining after all LOC Obligations have been cash
collateralized shall be applied to the Tranche A Term Loans and the Tranche
B Term Loans (ratably to the remaining Principal Amortization Payments
thereof); provided that with respect to all amounts paid pursuant to
--------
Section 3.03(b)(ii), the Borrower may elect to cause all or a portion of
-------------------
any such prepayment of Tranche A Term Loans and the Tranche B Term Loans to
be applied in direct order of maturity so long as, at the time of any such
prepayment applied in direct order of maturity and after giving effect
thereto, no more than the next four Principal Amortization Payments of
either the Tranche A Term Loans or the Tranche B Term Loans due under
Section 2.03(e) or 2.04(e), as applicable, have been prepaid. Within the
--------------- -------
parameters of the applications set forth above, prepayments shall be
applied first to Base Rate Loans and then, subject to subsection (viii)
-----------------
below, to Eurodollar Loans in direct order of Interest Period maturities.
All prepayments under this Section 3.03(b) shall be subject to Section
--------------- -------
3.11. All prepayments under this Section 3.03(b) shall be accompanied by
---- ---------------
accrued interest on the principal amount being prepaid to the date of
payment.
(viii) Prepayment Accounts. Amounts to be applied as provided in
-------------------
subsection (vi) above to the prepayment of Loans of any Class shall be
---------- ----
applied first to reduce outstanding Base Rate Loans of such Class. Any
amounts remaining after each such application shall, at the option of the
Borrower, be applied to prepay Eurodollar Loans of such Class immediately
and/or shall be deposited in a separate Prepayment Account (as defined
below) for the Loans of such Class. The Administrative Agent shall apply
any cash deposited in the Prepayment Account for any Class of Loans, upon
withdrawal by the Collateral Agent, to prepay Eurodollar Loans of such
Class on the last day of their respective Interest Periods (or, at the
direction of the Borrower, on any earlier date) until all outstanding Loans
of such Class have been prepaid or until all the
58
allocable cash on deposit in the Prepayment Account for such Class has been
exhausted. For purposes of this Agreement, the term "Prepayment Account"
------------------
for any Class of Loans shall mean an account (which may include the
Prepayment Account established under the Security Agreement) established by
the Borrower with the Collateral Agent and over which the Collateral Agent
shall have exclusive dominion and control, including the exclusive right of
withdrawal for application in accordance with this subsection. The
Collateral Agent will, at the request of the Borrower, invest amounts on
deposit in the Prepayment Account for any Class of Loans in Cash
Equivalents that mature prior to the last day of the applicable Interest
Periods of the Eurodollar Loans of such Class to be prepaid; provided,
--------
however, that (i) the Collateral Agent shall not be required to make any
-------
investment that, in its sole judgment, would require or cause the
Collateral Agent to be in, or would result in any, violation of any law,
statute, rule or regulation, (ii) such Cash Equivalents shall be subjected
to a first priority perfected security interest in favor of the Collateral
Agent and (iii) if any Event of Default shall have occurred and be
continuing, the selection of such Cash Equivalents shall be in the sole
discretion of the Collateral Agent. The Borrower shall indemnify the
Collateral Agent for any losses relating to such investments in Cash
Equivalents so that the amount available to prepay Eurodollar Loans on the
last day of the applicable Interest Periods is not less than the amount
that would have been available had no investments been made pursuant
thereto. Other than any interest or profits earned on such investments, the
Prepayment Accounts shall not bear interest. Interest or profits, if any,
on the investments in any Prepayment Account shall accumulate in such
Prepayment Account. If the maturity of the Loans has been accelerated
pursuant to Section 8.02, the Administrative Agent may, in its sole
------------
discretion, cause the Collateral Agent to withdraw amounts on deposit in
the Prepayment Account for any Class of Loans and apply such funds to
satisfy any of the Obligations related to such Class of Loans.
(ix) Notice. The Borrower shall give to the Administrative Agent
------
and the Lenders at least three Business Days' prior written or telecopy
notice of each and every event or occurrence requiring a prepayment under
Section 3.03(b)(ii), (iii), (iv) or (v), including the amount of Net Cash
------------------- ----- ---- ---
Proceeds expected to be received therefrom and the expected schedule for
receiving such proceeds; provided, however, that in the case of any
-------- -------
prepayment event consisting of a Casualty or Condemnation, the Borrower
shall give such notice within five Business Days after the occurrence of
such event; provided further, that the failure to give any such notice
-------- -------
shall in no way abrogate the Borrower's obligation to make any such
payment.
Section 3.04 Adjustment of Commitments.
(a) Optional Termination or Reduction of Commitments (Pro-Rata). The
-----------------------------------------------------------
Borrower may from time to time permanently reduce or terminate the Revolving
Committed Amount in whole or in part (in minimum aggregate amounts of $2,000,000
or in integral multiples of $500,000 in excess thereof (or, if less, the full
remaining amount of the then applicable Revolving Committed Amount)) upon three
Business Days' prior written or telecopy notice to the Administrative Agent;
provided, however, no such termination or reduction shall be made which would
-------- -------
cause the Revolving Outstandings to exceed the Revolving Committed Amount as so
reduced, unless, concurrently with such termination or reduction, the Revolving
Loans are repaid (and, after the Revolving Loans have been paid in full, the
Swingline Loans are repaid and, after the Swingline Loans have been paid in
full, the LOC Obligations are cash collateralized) to the extent necessary to
eliminate such excess. The Administrative Agent shall promptly notify each
affected Lender of the receipt by the Administrative Agent of any notice from
the Borrower pursuant to this Section 3.04(a).
---------------
(b) Mandatory Reductions. On any date that any Revolving Loans are
--------------------
required to be prepaid, Swingline Loans are required to be prepaid and/or LOC
Obligations are required to be cash
59
collateralized pursuant to the terms of Section 3.03(b)(ii), (iii), (iv) or
------------------- ----- ----
(v) (or would be so required if any Revolving Loans, Swingline Loans or LOC
---
Obligations were outstanding), the Revolving Committed Amount shall be
automatically and permanently reduced by the total amount of such required
prepayments and cash collateral (and, in the event that the amount of any
payment referred to in Section 3.03(b)(ii), (iii), (iv) or (v) which is
------------------- ----- ---- ---
allocable to the Revolving Outstandings exceeds the amount of all outstanding
Revolving Outstandings, the Revolving Committed Amount shall be further reduced
by 100% of such excess).
(c) Termination. The Revolving Commitments of the Lenders, the
-----------
Swingline Commitment of the Swingline Lender and the LOC Commitments of the
Issuing Lenders shall automatically terminate on the Revolving Termination Date.
The Tranche A Term Loan Commitments and Tranche B Term Loan Commitments of the
Lenders shall automatically terminate immediately after the making of the Term
Loans on the Effective Date.
(d) Optional Termination of Commitments (Non-Pro-Rata). If (i) any
--------------------------------------------------
Lender has demanded compensation or indemnification pursuant to Section 3.06 or
------------
Section 3.10, (ii) the obligation of any Lender to make Eurodollar Loans has
------------
been suspended pursuant to Section 3.08, (iii) any Lender is a Defaulting Lender
------------
or (iv) any Lender has failed to consent to a proposed amendment, waiver,
discharge or termination which pursuant to the terms of Section 10.06 or any
-------------
other provision of any Credit Document requires the consent of all of the
Lenders and with respect to which the Required Lenders shall have granted their
consent, the Borrower shall have the right, if no Default or Event of Default
then exists, to replace such Lender with one or more Eligible Assignees (which
may be one or more of the Continuing Lenders) (each a "Replacement Lender" and,
------------------
collectively, the "Replacement Lenders") reasonably acceptable to the
-------------------
Administrative Agent. The replacement of a Retiring Lender pursuant to this
Section 3.04(d) shall be effective on the tenth Business Day (the "Replacement
--------------- -----------
Date") following the date of notice of such replacement to the Retiring Lender
----
and each Continuing Lender through the Administrative Agent, subject to the
satisfaction of the following conditions:
(i) the Retiring Lender and the Replacement Lender shall have
satisfied the conditions to assignment and assumption set forth in Section
-------
10.03(b) (with all fees payable pursuant to Section 10.03(b) to be paid by
-------- ----------------
the Borrower) and, in connection therewith, the Replacement Lender(s) shall
pay:
(A) to the Retiring Lender an amount equal in the aggregate
to the sum of (x) the principal of, and all accrued but unpaid
interest on, all outstanding Loans of the Retiring Lender, (y) all
unpaid drawings that have been funded by (and not reimbursed to) the
Retiring Lender under Section 2.02(d), together with all accrued but
---------------
unpaid interest with respect thereto and (z) all accrued but unpaid
fees owing to the Retiring Lender pursuant to Section 3.05;
------------
(B) to the Issuing Lenders an amount equal to the aggregate
amount owing by the Retiring Lender to the Issuing Lenders as
reimbursement pursuant to Section 2.02(c), to the extent such amount
---------------
was not theretofore funded by such Retiring Lender; and
(ii) the Borrower shall have paid to the Administrative Agent for
the account of the Retiring Lender an amount equal to all obligations owing
to the Retiring Lender by the Borrower pursuant to this Agreement and the
other Credit Documents (other than those obligations of the Borrower
referred to in clause (i)(A) above).
-------------
60
On the Replacement Date, each Replacement Lender that is a New Lender
shall become a Lender hereunder, and the Retiring Lender shall cease to
constitute a Lender hereunder; provided that the provisions of this Agreement
--------
(including, without limitation, the provisions of Sections 3.11, 3.06, 3.10 and
------------- ---- ----
10.05) shall continue to govern the rights and obligations of a Retiring Lender
-----
with respect to any Loans made, any Letters of Credit issued or any other
actions taken by such Retiring Lender while it was a Lender.
In lieu of the foregoing, upon express written consent of a majority
of the Continuing Lenders, the Borrower shall have the right to terminate the
Commitment of a Retiring Lender in full. Upon payment by the Borrower to the
Administrative Agent for the account of the Retiring Lender of an amount equal
to the sum of (i) the aggregate principal amount of all Loans and LOC
Obligations held by the Retiring Lender and (ii) all accrued interest, fees and
other amounts owing to the Retiring Lender hereunder, including, without
limitation, all amounts payable by the Borrower to the Retiring Lender under
Section 3.11, 3.06, 3.10 or 10.05, such Retiring Lender shall cease to
------------ ---- ---- -----
constitute a Lender hereunder; provided that the provisions of this Agreement
--------
(including, without limitation, the provisions of Sections 3.11, 3.06, 3.10 and
------------- ---- ----
10.05) shall continue to govern the rights and obligations of a Retiring Lender
-----
with respect to any Loans made, any Letters of Credit issued or any other
actions taken by such Retiring Lender while it was a Lender.
(e) General. The Borrower shall pay to the Administrative Agent for
-------
the account of the Lenders in accordance with the terms of Section 3.05(b), on
---------------
the date of each termination or reduction of the Revolving Committed Amount, the
Commitment Fee accrued through the date of such termination or reduction on the
amount of the Revolving Committed Amount so terminated or reduced.
Section 3.05 Fees.
----
(a) Commitment Fee. In consideration of the Revolving Commitments of
--------------
the Lenders hereunder, the Borrower agrees to pay to the Administrative Agent
for the account of each Lender a fee (the "Commitment Fee") on such Lender's
--------------
Revolving Commitment Percentage of the Unused Revolving Committed Amount,
computed at a per annum rate for each day during the applicable Commitment Fee
Calculation Period at a rate equal to the Applicable Percentage in effect from
time to time. The Commitment Fee shall commence to accrue on the Effective Date
and shall be due and payable in arrears on each March 31, June 30, September 30
and December 31 (and any date that the Revolving Committed Amount is reduced as
provided in Section 3.04(a) or (b) and the Revolving Termination Date) for the
--------------- ---
immediately preceding quarter or portion thereof (each such quarter or portion
thereof being herein referred to as a "Commitment Fee Calculation Period"),
---------------------------------
beginning with the first of such dates to occur after the Effective Date.
(b) Letter of Credit Fees.
---------------------
(i) Standby Letter of Credit Issuance Fee. In consideration of
-------------------------------------
the issuance of standby Letters of Credit hereunder, the Borrower promises
to pay to the Administrative Agent for the account of each Revolving Lender
a fee (the "Standby Letter of Credit Fee") on such Revolving Lender's
----------------------------
Revolving Commitment Percentage of the average daily maximum amount
available to be drawn under each such standby Letter of Credit computed at
a per annum rate for each day from the date of issuance to the date of
expiration equal to the Applicable Percentage. The Standby Letter of Credit
Fee will be payable quarterly in arrears on each March 31, June 30,
September 30 and December 31 for the immediately preceding quarter (or
portion thereof), beginning with the first of such dates to occur after the
Effective Date.
61
(ii) Commercial Letter of Credit Drawing Fee. In consideration of
---------------------------------------
the issuance of trade Letters of Credit hereunder, the Borrower promises to
pay to the Administrative Agent for the account of each Lender a fee (the
"Trade Letter of Credit Fee") equal to the Applicable Percentage on such
--------------------------
Lender's Revolving Commitment Percentage of the amount of each drawing
under any such trade Letter of Credit. The Trade Letter of Credit Fee will
be payable on each date of drawing under a trade Letter of Credit.
(iii) Issuing Lender Fees. In addition to the Standby Letter of
-------------------
Credit Fee payable pursuant to clause (i) above and the Trade Letter of
----------
Credit Fee payable pursuant to clause (ii) above, the Borrower promises to
-----------
pay to the Issuing Lender for its own account without sharing by the other
Lenders the letter of credit fronting and negotiation fees agreed to by
the Borrower and the Issuing Lender from time to time and the customary
charges from time to time of the Issuing Lender with respect to the
issuance, amendment, transfer, administration, cancellation and conversion
of, and drawings under, such Letters of Credit (collectively, the "Issuing
-------
Lender Fees").
-----------
Section 3.06 Increased Costs and Reduced Return. (a) If the adoption
----------------------------------
of or any change in any Requirement of Law or in the interpretation or
application thereof applicable to any Lender (or its Applicable Lending Office),
or compliance by any Lender (or its Applicable Lending Office) with any request
or directive (whether or not having the force of law) from any central bank or
other Governmental Authority, in each case made subsequent to the Effective Date
(or, if later, the date on which such Lender becomes a Lender):
(i) shall subject such Lender (or its Applicable Lending Office)
to any tax of any kind whatsoever with respect to any Letter of Credit, any
Eurodollar Loans made by it or any of its Notes or its obligation to make
Eurodollar Loans, or change the basis of taxation of payments to such
Lender (or its Applicable Lending Office) in respect thereof (except for
Non-Excluded Taxes covered by Section 3.10 (including Non-Excluded Taxes
-----------
imposed solely by reason of any failure of such Lender to comply with its
obligations under Section 3.10(c)) and Excluded Taxes.
----------------
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender (or its Applicable Lending Office) which is not
otherwise included in the determination of the Eurodollar Rate hereunder;
or
(iii) shall impose on such Lender (or its Applicable Lending
Office) any other condition (excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, converting into, continuing or
maintaining Eurodollar Loans or issuing or participating in Letters of Credit or
to reduce any amount receivable hereunder in respect thereof, then, in any such
case, upon notice to the Borrower from such Lender, through the Administrative
Agent, in accordance herewith, the Borrower shall be obligated to promptly pay
such Lender, upon its demand and delivery of the certificate described in clause
------
(c) below, any additional amounts necessary to compensate such Lender on an
---
after-tax basis (after taking into account applicable deductions and credits in
respect of the amount indemnified) for such increased cost or reduced amount
receivable, provided that, in any such case, the Borrower may elect to convert
--------
the Eurodollar Loans made by such Lender hereunder to Base Rate Loans by
62
giving the Administrative Agent at least one Business Day's notice of such
election, in which case the Borrower shall promptly pay to such Lender, upon
demand, without duplication, such amounts, if any, as may be required pursuant
to Section 3.11.
------------
(b) If after the date hereof, any Lender shall have determined that
the adoption or the becoming effective of, or any change in, or any change by
any Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender, or its parent corporation, with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Lender's (or parent corporation's)
capital or assets as a consequence of its commitments or obligations hereunder
to a level below that which such Lender, or its parent corporation, could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's (or parent corporation's) policies with respect to
capital adequacy), then, upon notice from such Lender to the Borrower and
delivery of the certificate described in clause (c) below, the Borrower shall be
----------
obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender on an after-tax basis (after taking into account
applicable deductions and credits in respect of the amount indemnified) for such
reduction. Each determination by any such Lender of amounts owing under this
Section shall, absent manifest error, be conclusive and binding on the parties
hereto.
(c) Each Lender shall promptly notify the Borrower and the
Administrative Agent of any event of which it has knowledge, occurring after the
date hereof, which will entitle such Lender to compensation pursuant to this
Section and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the reasonable judgment of such Lenders be otherwise
disadvantageous to such Lender. A certificate of any Lender claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder (and the basis for calculation thereof) shall
be conclusive in the absence of manifest error. In determining such amount, such
Lenders may use any reasonable averaging and attribution methods.
Section 3.07 Base for Determining Interest Rate Inadequate or Unfair.
-------------------------------------------------------
If on or prior to the first day of any Interest Period for any Eurodollar Loan:
(i) the Administrative Agent determines in good faith (which
determination shall be conclusive) that by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist
for ascertaining the Eurodollar Rate for such Interest Period; or
(ii) the Required Lenders determine in good faith (which
determination shall be conclusive) and notify the Administrative Agent that
the Adjusted Eurodollar Rate will not adequately and fairly reflect the
cost to the Lenders of funding Eurodollar Loans for such Interest Period;
then the Administrative Agent shall give the Borrower prompt notice thereof
specifying the relevant amounts or periods, and so long as such condition
remains in effect, the Lenders shall be under no obligation to make additional
Eurodollar Loans, extend Eurodollar Loans for additional Interest Periods or to
convert Base Rate Loans into Eurodollar Loans, and the Borrower shall, on the
last day(s) of the then current Interest Period(s) for the outstanding
Eurodollar Loans, either prepay such Loans or convert such Loans into Base Rate
Loans in accordance with the terms of this Agreement.
63
Section 3.08 Illegality. Notwithstanding any other provision herein,
----------
if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof occurring after the Effective Date shall
make it unlawful for any Lender to make or maintain Eurodollar Loans as
contemplated by this Agreement, (i) such Lender shall promptly give written
notice of such circumstances to the Borrower and the Administrative Agent (which
notice shall be withdrawn whenever such circumstances no longer exist), (ii) the
commitment of such Lender hereunder to make Eurodollar Loans, continue
Eurodollar Loans as such and convert a Base Rate Loan to Eurodollar Loans shall
forthwith be canceled and, until such time as it shall no longer be unlawful for
such Lender to make or maintain Eurodollar Loans, such Lender shall then have a
commitment only to make a Base Rate Loan when a Eurodollar Loan is requested and
(iii) such Lender's Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interests Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 3.11.
------------
Section 3.09 Treatment of Affected Loans. If the obligation of any
---------------------------
Lender to make Eurodollar Loans or to convert Base Rate Loans into, or to
continue Eurodollar Loans as Eurodollar Loans shall be suspended pursuant to
Section 3.06 or 3.08 hereof (Loans of such Type being herein called "Affected
------------ ---- --------
Loans" and such Type being herein called the "Affected Type"), such Lender's
----- -------------
Affected Loans shall be automatically converted into Base Rate Loans on the last
day(s) of the then current Interest Period(s) for Affected Loans (or, in the
case of a conversion required by Section 3.08 hereof, on such earlier date as
------------
such Lender may specify to the Borrower with a copy to the Administrative Agent)
and, unless and until such Lender gives notice as provided below that the
circumstances specified in Section 3.06 or 3.08 hereof that gave rise to such
------------ ----
conversion no longer exist:
(i) to the extent such Lender's Affected Loans have been so
converted, all payments and prepayments of principal that would otherwise
be applied to such Lender's Affected Loans shall be applied instead to its
Base Rate Loans; and
(ii) all Loans that would otherwise be made or extended by such
Lender as Loans of the Affected Type shall be made or extended instead as
Base Rate Loans, and all Loans of such Lender that would otherwise be
converted into Loans of the Affected Type shall be converted instead into
(or shall remain as) Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 3.06 or 3.08 hereof that gave
------------ ----
rise to the conversion of such Lender's Affected Loans pursuant to this Section
-------
3.09 no longer exist (which such Lender agrees to do promptly upon such
----
circumstances ceasing to exist) at a time when Loans of the Affected Type made
by other Lenders are outstanding, such Lender's Base Rate Loans shall be
automatically converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding Loans of the Affected Type, to the extent
necessary so that, after giving effect thereto, all Loans held by the Lenders
holding Loans of a particular Class of the Affected Type and by such Lender are
held pro-rata (as to principal amounts, Types, and Interest Periods) in
accordance with their respective Commitments of such Class.
Section 3.10 Taxes.
-----
(a) Payments Net of Certain Taxes. Except as provided below in this
-----------------------------
Section 3.10, all payments made by the Borrower under this Agreement and any
------------
Notes shall be made free and clear of,
64
and without deduction or withholding for or on account of, any present or future
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any court, or
Governmental Authority, excluding (i) taxes imposed on or measured by all or
part of the gross receipts, net receipts or gross or net income of any Lender or
its Applicable Lending Office, or any branch or affiliate thereof, or the
Administrative Agent, (ii) any franchise taxes, branch taxes, taxes on doing
business or taxes on the overall capital or net worth of any Lender or its
Applicable Lending Office, or any branch or affiliate thereof, in each case
imposed in lieu of net income taxes, (iii) any taxes resulting from a transfer
or assignment of all or such portion of a Loan, unless the Lender transfers all
or any portion of a Loan at the request of the Borrower, or (iv) any tax imposed
by reason of any connection between the jurisdiction imposing such tax and such
Lender, Applicable Lending Office, branch or affiliate other than a connection
arising solely from such Lender having executed, delivered or performed its
obligations, or received payment under or enforced, this Agreement or any Notes
(the taxes described in these clauses (i)-(v) are collectively referred to
----------- ---
herein as the "Excluded Taxes"). If any such non-excluded taxes, levies,
--------------
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
------------
Taxes") are required to be withheld from any amounts payable to the
-----
Administrative Agent or any Lender hereunder or under any Notes, (i) the amounts
so payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement and any
Notes, provided, however, that the Credit Parties shall be entitled to deduct
-------- -------
and withhold any Non-Excluded Taxes and shall not be required to increase any
such amounts payable to any Lender that is not organized under the laws of the
United States of America or a state thereof if such Lender fails to comply with
the requirements of paragraph (c) of this Section 3.10 whenever any Non-Excluded
------------- ------------
Taxes are payable by the Borrower, and (ii) as promptly as possible thereafter
the Borrower shall send to the Administrative Agent for its own account or for
the account of such Lender, as the case may be, a certified copy of an original
official receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Administrative Agent and any Lender for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as a
result of any such failure. If a Lender shall change its office that makes or
maintains a Loan hereunder, the Borrower shall not be required to pay any
increased amounts to the Lender in respect of any Non-Excluded Taxes pursuant to
this Section 3.10(a) except to the extent that any obligation to withhold or
---------------
deduct any amount with respect to such Non-Excluded Taxes existed on the date
the Lender changed such office, unless the Lender changed the office at the
request of the Borrower. The agreements in this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
(b) If a Lender or the Administrative Agent receives a refund or
realizes a credit or reduction in tax in respect of any Non-Excluded Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to Section 3.10(a) hereof it shall
---------------
within 30 days from the date of such receipt pay over the amount of such refund
or benefit of such credit or reduction in tax to the Borrower (but only to the
extent of aggregate indemnity payments made, or additional amounts paid, by the
Borrower under Section 3.10(a) hereof), net of all reasonable out-of-pocket
---------------
expenses of such Lender or the Administrative Agent and without interest (other
than interest paid by the relevant Governmental Authority and respect to such
refund, credit or reduction in tax); provided, however, that the Borrower, upon
-------- -------
the request of such Lender or the Administrative Agent, agrees to repay the
amount paid over to the Borrower (plus penalties, interest or other charges) to
such Lender or the Administrative Agent in the event such Lender or the
Administrative Agent is required to repay such refund, credit or reduction in
tax to such Governmental Authority.
65
(c) Tax Forms and Certificates. Each Lender that is not incorporated
--------------------------
under the laws of the United States of America or a state thereof shall:
(A) on or before the date of any payment by the Borrower
under this Agreement or Notes to such Lender, deliver to the Borrower
and the Administrative Agent two duly completed copies of United
States Internal Revenue Service Form W-8BEN or W-8ECI, or applicable
successor form, as the case may be, certifying (x) that it is entitled
to receive payments under this Agreement and any Notes without
deduction or withholding of any United States federal income taxes and
(y) that it is entitled to an exemption from United States backup
withholding tax;
(B) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date
that any such form or certification expires or becomes obsolete and
after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower; and
(C) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the
Borrower or the Administrative Agent; or
(ii) in the case of any such Lender that is not a "bank" within
the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (A)
represent to the Borrower (for the benefit of the Borrower and the
Administrative Agent) that it is not a bank within the meaning of Section
881(c)(3)(A) of the Internal Revenue Code, (B) agree to furnish the
Borrower, on or before the date of any payment by the Borrower, with a copy
to the Administrative Agent, two accurate and complete original signed
copies of Internal Revenue Service Form W-8BEN, or applicable successor
form certifying to such Lender's legal entitlement at the date of such
certificate to an exemption from U.S. withholding tax under the provisions
of Section 881(c) of the Internal Revenue Code with respect to payments to
be made under this Agreement and any Notes (and to deliver to the Borrower
and the Administrative Agent two further copies of such forms on or before
the date it expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recently provided form and, if
necessary, obtain any extensions of time reasonably requested by the
Borrower or the Administrative Agent for filing and completing such forms),
and (C) agree, to the extent legally entitled to do so, upon reasonable
request by the Borrower, to provide to the Borrower (for the benefit of the
Borrower and the Administrative Agent) such other forms as may be
reasonably required in order to establish the legal entitlement of such
Lender to an exemption from withholding with respect to payments under this
Agreement and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation has
occurred after the date such Person becomes a Lender hereunder which renders all
such forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form with respect to it and such Lender so advises the
Borrower and the Administrative Agent then such Lender shall be exempt from such
requirements. Each Person that shall become a Lender or a participant of a
Lender pursuant to Section 10.03(e) shall, upon the effectiveness of the related
----------------
transfer, be required to provide all the forms, certifications and statements
required pursuant to this subsection (c); provided that in the case of a
-------------- --------
participant of a Lender, the obligations of such participant of a Lender
pursuant to this subsection (c) shall be determined as if the participant of a
--------------
Lender were a Lender except that such participant of a Lender shall furnish all
such required
66
forms, certifications and statements to the Lender from which the related
participation shall have been purchased.
(d) Mitigation. If any such taxes shall be or become applicable after
----------
the date of this Agreement to such payments by the Borrower to a Lender, such
Lender shall use reasonable efforts to make, fund or maintain the Loan or Loans,
as the case may be, through another Applicable Lending Office located in another
jurisdiction so as to reduce, to the fullest extent possible, the Borrower's
liability hereunder, if the making, funding or maintenance of such Loan or Loans
through such other office is not, in the reasonable judgment of the Lender,
materially disadvantageous to such Lender.
Section 3.11 Funding Losses. The Borrower agrees to indemnify each
--------------
Lender and to hold each Lender harmless from any loss or expense which such
Lender may sustain or incur (other than through such Lender's gross negligence
or willful misconduct) as a consequence of (i) default by the Borrower in making
a borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (ii) default by the Borrower in making any
prepayment of a Eurodollar Loan after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement and (iii) the making of a
prepayment of Eurodollar Loans on a day which is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
(i) the present value of the amount of interest which would have accrued on the
amount prepaid, or not so borrowed, converted or continued, for the period from
the date of such prepayment or of such failure to borrow, convert or continue to
the last day of the applicable Interest Period (or, in the case of a failure to
borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Eurodollar Loans provided for herein (excluding, however, the Applicable
Percentage included therein, if any) minus (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the Interbank Eurodollar market; provided, that such Lender
--------
shall have delivered to the Borrower a certificate as to the amount of such loss
or expense, which certificate shall be conclusive in the absence of manifest
error. The agreements in this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
Section 3.12 Pro Rata Treatment. Except to the extent otherwise
------------------
provided herein:
(a) Loans. Each Revolving Borrowing (including, without limitation,
-----
each Mandatory LOC Borrowing and each Mandatory Swingline Borrowing), each
payment or prepayment of principal of any Loan (subject to the terms of Section
-------
3.03 providing holders of Tranche B Term Loans the option to decline prepayments
----
thereof), each payment of fees (other than the Issuing Lender Fees retained by
the Issuing Lender for its own account and the administrative fees retained by
the Administrative Agent for its own account), each reduction of the Revolving
Committed Amount, and each conversion or continuation of any Loan, shall be
allocated pro-rata among the relevant Lenders in accordance with the respective
Revolving Commitment Percentages, Tranche A Term Loan Commitment Percentages and
Tranche B Term Loan Commitment Percentages, as applicable, of such Lenders (or,
if the Commitments of such Lenders have expired or been terminated, in
accordance with the respective principal amounts of the outstanding Loans and
Participation Interests of such Lenders); provided that, in the event any amount
--------
paid to any Lender pursuant to this subsection (a) is rescinded or must
--------------
otherwise be returned by the Administrative Agent, each Lender shall, upon the
request of the Administrative Agent, repay to the Administrative Agent the
amount so paid to such Lender, with interest for the period commencing on the
date such payment is returned by the Administrative Agent until the date the
Administrative Agent receives such repayment at a rate per annum equal to,
during the period to but excluding the date two Business Days after such
request, the Federal Funds Rate, and thereafter, the Base Rate plus two percent
(2%) per annum.
67
(b) Letters of Credit. Each payment of unreimbursed drawings in
-----------------
respect of LOC Obligations shall be allocated to each LOC Participant pro rata
in accordance with its Revolving Commitment Percentage; provided that, if any
--------
LOC Participant shall have failed to pay its applicable pro rata share of any
drawing under any Letter of Credit, then any amount to which such LOC
Participant would otherwise be entitled pursuant to this subsection (b) shall
--------------
instead be payable to the Issuing Lender as necessary to achieve the foregoing
pro rata allocations; provided further, that in the event any amount paid to any
-------- -------
LOC Participant pursuant to this subsection (b) is rescinded or must otherwise
--------------
be returned by the Issuing Lender, each LOC Participant shall, upon the request
of the Issuing Lender, repay to the Administrative Agent for the account of the
Issuing Lender the amount so paid to such LOC Participant, with interest for the
period commencing on the date such payment is returned by the Issuing Lender
until the date the Issuing Lender receives such repayment at a rate per annum
equal to, during the period to but excluding the date two Business Days after
such request, the Federal Funds Rate, and thereafter, the Base Rate plus two
percent (2%) per annum.
Section 3.13 Sharing of Payments. The Lenders agree among themselves
-------------------
that, except to the extent otherwise provided herein, if any Lender shall obtain
payment in respect of any Loan, unreimbursed drawing with respect to any LOC
Obligations or any other obligation owing to such Lender under this Agreement
through the exercise of a right of setoff, banker's lien or counterclaim, or
pursuant to a secured claim under Section 506 of the Bankruptcy Code or other
security or interest arising from, or in lieu of, such secured claim, received
by such Lender under any applicable bankruptcy, insolvency or other similar law
or otherwise, or by any other means (including by way of payment from the
Borrower), in excess of its pro-rata share of such payment as provided for in
this Agreement, such Lender shall promptly pay in cash or purchase from the
other Lenders a participation in such Loans, LOC Obligations, and other
obligations in such amounts, and make such other adjustments from time to time,
as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this
Agreement. The Lenders further agree among themselves that if payment to a
Lender obtained by such Lender through the exercise of a right of setoff,
banker's lien, counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared the benefit of
such payment shall, by payment in cash or a repurchase of a participation
theretofore sold, return its share of that benefit (together with its share of
any accrued interest payable with respect thereto) to each Lender whose payment
shall have been rescinded or otherwise restored. The Borrower agrees that any
Lender so purchasing such a participation may, to the fullest extent permitted
by law, exercise all rights of payment, including setoff, banker's lien or
counterclaim, with respect to such participation as fully as if such Lender were
a holder of such Loan, LOC Obligation or other obligation in the amount of such
participation. Except as otherwise expressly provided in this Agreement, if any
Lender or the Administrative Agent shall fail to remit to the Administrative
Agent or any other Lender an amount payable by such Lender or the Administrative
Agent to the Administrative Agent or such other Lender pursuant to this
Agreement on the date when such amount is due, such payments shall be made
together with interest thereon if paid within two Business Days of the date when
such amount is due at a per annum rate equal to the Federal Funds Rate and
thereafter at a per annum rate equal to the Base Rate until the date such amount
is paid to the Administrative Agent or such other Lender. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.13 applies, such
------------
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders under this
Section 3.13 to share in the benefits of any recovery on such secured claim.
------------
Section 3.14 Payments; Computations.
----------------------
(a) Payments by the Borrower. Each payment of principal of and
------------------------
interest on Loans, LOC Obligations and fees hereunder (other than fees payable
directly to the Issuing Lenders) shall be paid not later than 3:00 P.M. (local
time in Charlotte, North Carolina) on the date when due, in Federal or
68
other funds immediately available in Charlotte, North Carolina, to the
Administrative Agent at its Agency Services Address. Each such payment shall be
made irrespective of any set-off, counterclaim or defense to payment which might
in the absence of this provision be asserted by the Borrower or any Affiliate
against the Administrative Agent or any Lender. Payments received after 3:00
P.M. (local time in Charlotte, North Carolina) shall be deemed to have been
received on the next Business Day. The Borrower shall, at the time it makes any
payments under this Agreement, specify to the Administrative Agent the Loan,
Letters of Credit, fees or other amounts payable by the Borrower hereunder to
which such payment is to be applied (and if it fails to specify or if such
application would be inconsistent with the terms hereof, the Administrative
Agent shall, subject to Section 3.12, distribute such payment to the Lenders in
------------
such manner as the Administrative Agent may deem appropriate). The
Administrative Agent will distribute such payments to the applicable Lenders on
the date of receipt thereof, if such payment is received prior to 1:00 P.M.;
otherwise the Administrative Agent will distribute such payment to the
applicable Lenders on the next succeeding Business Day. Whenever any payment
hereunder shall be due on a day which is not a Business Day, the date for
payment thereof shall be extended to the next succeeding Business Day unless (in
the case of Eurodollar Loans) such Business Day falls in another calendar month,
in which case the date for payment thereof shall be the next preceding Business
Day. If the date for any payment of principal is extended by operation of law or
otherwise, interest thereon shall be payable for such extended time. The
Borrower hereby authorizes and directs the Administrative Agent to debit any
account maintained by the Borrower with the Administrative Agent to pay when due
any amounts required to be paid from time to time under this Agreement.
(b) Distributions by the Administrative Agent. Unless the
-----------------------------------------
Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Lenders hereunder that the Borrower will
not make such payment in full, the Administrative Agent may assume that the
Borrower has made such payment in full to the Administrative Agent on such date,
and the Administrative Agent may, in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent that the Borrower shall not have so made
such payment, each Lender shall repay to the Administrative Agent forthwith on
demand such amount distributed to such Lender together with interest thereon,
for each day from the date such amount is distributed to such Lender until the
date such Lender repays such amount to the Administrative Agent, at the Federal
Funds Rate.
(c) Computations. Except for Base Rate Loans, in which case interest
------------
shall be computed on the basis of a 365 or 366 day year as the case may be
(unless the Base Rate is determined by reference to the Federal Funds Rate), all
computations of interest and fees hereunder shall be made on the basis of the
actual number of days elapsed over a year of 360 days. Interest shall accrue
from and include the date of borrowing (or continuation or conversion) but
exclude the date of payment.
(d) Failed Loans. If any Lender shall fail to make any Loan (a "Failed
------------ ------
Loan") which such Lender is otherwise obligated hereunder to make to the
----
Borrower on the date of Borrowing (including, without limitation, any Mandatory
LOC Borrowing and any Mandatory Swingline Borrowing) thereof, and the
Administrative Agent shall not have received notice from the Borrower or such
Lender that any condition precedent to the making of the Failed Loan has not
been satisfied, then, until such Lender shall have made or be deemed to have
made (pursuant to the last sentence of this subsection (d)) the Failed Loan in
--------------
full or the Administrative Agent shall have received notice from the Borrower or
such Lender that any condition precedent to the making of the Failed Loan was
not satisfied at the time the Failed Loan was to have been made, whenever the
Administrative Agent shall receive any amount from the Borrower for the account
of such Lender, (i) the amount so received (up to the amount of such Failed
Loan) will, upon receipt by the Administrative Agent, be deemed to have been
paid to the Lender in satisfaction of the obligation for which paid, without
actual disbursement of such amount to the Lender, (ii) the Lender will be deemed
to have made the same amount available to the Administrative Agent for
69
disbursement as a Loan to the Borrower (up to the amount of such Failed Loan)
and (iii) the Administrative Agent will disburse such amount (up to the amount
of the Failed Loan) to the Borrower or, if the Administrative Agent has
previously made such amount available to the Borrower on behalf of such Lender
pursuant to the provisions hereof, reimburse itself (up to the amount of the
amount made available to the Borrower); provided, however, that the
-------- -------
Administrative Agent shall have no obligation to disburse any such amount to the
Borrower or otherwise apply it or deem it applied as provided herein unless the
Administrative Agent shall have determined in its sole discretion that to so
disburse such amount will not violate any law, rule, regulation or requirement
applicable to the Administrative Agent. Upon any such disbursement by the
Administrative Agent, such Lender shall be deemed to have made a Base Rate Loan
of the same Class as the Failed Loan to the Borrower in satisfaction, to the
extent thereof, of such Lender's obligation to make the Failed Loan.
Section 3.15 Evidence of Debt. (a) Each Lender shall maintain an
----------------
account or accounts evidencing each Loan made by such Lender to the Borrower
from time to time, including the amounts of principal and interest payable and
paid to such Lender from time to time under this Agreement. Each Lender will
make reasonable efforts to maintain the accuracy of its account or accounts and
to promptly update its account or accounts from time to time, as necessary.
(b) The Administrative Agent shall maintain the Register pursuant to
Section 10.03(c), and a subaccount for each Lender, in which Register and
----------------
subaccounts (taken together) shall be recorded (i) the amount, type and Interest
Period of each such Loan hereunder, (ii) the amount of any principal or interest
due and payable or to become due and payable to each Lender hereunder and (iii)
the amount of any sum received by the Administrative Agent hereunder from or for
the account of the Borrower and each Lender's share thereof. The Administrative
Agent will make reasonable efforts to maintain the accuracy of the subaccounts
referred to in the preceding sentence and to promptly update such subaccounts
from time to time, as necessary.
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.15 (and, if consistent
-------------- ------------
with the entries of the Administrative Agent, subsection (a)) shall be prima
--------------
facie evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any Lender or the
-------- -------
Administrative Agent to maintain any such account, such Register or such sub
account, as applicable, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay the Loans made by such Lender in accordance
with the terms hereof.
ARTICLE IV
CONDITIONS
Section 4.01 Conditions to Effectiveness. This Agreement shall become
---------------------------
effective on the first date (the "Effective Date") upon which all of the
--------------
following conditions have been satisfied:
(a) Executed Credit Documents. Receipt by the Administrative Agent of
-------------------------
duly executed copies of: (i) this Agreement; (ii) the Notes; (iii) the
Acknowledgment Agreement; and (iv) all other Collateral Documents and other
Credit Documents to be executed and delivered on the Effective Date, each in
form and substance satisfactory to the Lenders in their sole discretion.
(b) Corporate Documents. The Administrative Agent shall have received
-------------------
the following:
(i) Constituent Documents. A copy of the operating agreement,
---------------------
articles or certificates of incorporation, bylaws or other constituent
document of Holdings and each Credit
70
Party certified by a secretary or assistant secretary or other authorized
signatory of Holdings and each Credit Party to be true and correct as of
the Effective Date.
(ii) Resolutions. Copies of resolutions of the Board of Directors
-----------
or other governing body of Holdings and each Credit Party approving and
adopting the Credit Documents, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a secretary or
assistant secretary or other authorized signatory of Holdings and each
Credit Party to be true and correct and in force and effect as of the
Effective Date.
(iii) Good Standing. Copies of (A) certificates of good standing,
-------------
existence or its equivalent with respect to Holdings and each Credit Party
certified as of a recent date by the appropriate Governmental Authorities
of the state or other jurisdiction of formation and each other jurisdiction
in which the failure to so qualify and be in good standing would have or be
reasonably expected to have a Material Adverse Effect on the business or
operations of Holdings and each Credit Party in such jurisdiction and (B)
to the extent available, a certificate indicating payment of all applicable
corporate or similar franchise taxes certified as of a recent date by the
appropriate governmental taxing authority of its jurisdiction of
incorporation.
(iv) Incumbency. An incumbency certificate of Holdings and each
----------
Credit Party certified by a secretary or assistant secretary or other
authorized signatory to be true and correct as of the Effective Date.
(c) Financial Statements. The Administrative Agent and each Lender
--------------------
shall have received: (i) audited financial statements of the Parent and its
Consolidated Subsidiaries and the Borrower and its Consolidated Subsidiaries for
the fiscal years ended December 31, 1999, 2000 and 2001, unaudited financial
statements of the Parent and its Consolidated Subsidiaries and the Borrower and
its Consolidated Subsidiaries for any interim quarterly periods which have ended
since the most recent of such audited financial statements and at least 30 days
prior to the Effective Date, and pro-forma financial statements as to the Parent
and its Consolidated Subsidiaries and the Borrower and its Consolidated
Subsidiaries giving effect to the Transaction, which in each case, (A) shall be
satisfactory in form and, to the extent containing information in addition to,
or different from the information contained in the Pre-Commitment Information,
substance to the Administrative Agent, (B) shall not be materially inconsistent
with the Pre-Commitment Information and (C) in the case of the financial
statement of the Borrower and its Consolidated Subsidiaries, shall meet the
requirements of Regulation S-X under the Securities Act of 1933, as amended, and
all other accounting rules and regulations of the Securities Exchange Commission
promulgated thereunder applicable to a registration statement under such Act on
Form S-1; (ii) forecasts prepared by management of the Credit Parties, each in
form satisfactory to the Administrative Agent and the Lenders, of balance
sheets, income statements and cash flow statements on a monthly basis for the
period from Effective Date through December 31, 2002 and on an annual basis for
each year thereafter through the Maturity Date; and (iii) a written
certification from the chief financial officer of the Parent and the Borrower on
behalf of the Parent and the Borrower that (A) Consolidated EBITDA (adjusted in
accordance with GAAP, with adjustments mutually satisfactory to the
Administrative Agent and the Borrower in a manner substantially consistent with
Schedule 4.01(c) hereto) for the year ended December 31, 2001 was not less than
----------------
$109.5 million, (B) the pro-forma Leverage Ratio for the year ended December 31,
2001 (which pro-forma ratio shall be calculated reflecting the Transaction on a
pro-forma basis) was not greater than 4.6:1.0 (provided, that Consolidated
--------
EBITDA used in such calculation shall be adjusted as described in clause (A)
----------
above) and (C) the pro-forma financial statements delivered pursuant to clause
------
(i) above and the forecasts delivered pursuant to clause (ii) above were
--- -----------
prepared in good faith on the basis of the assumptions stated therein, which
assumptions are fair in light of then existing conditions (it being understood
that projections as to future events are subject to uncertainties and
contingencies and
71
that no assurance can be given that any financial projections contained in the
forecasts delivered pursuant to clause (ii) above will be realized).
-----------
(d) Opinions of Counsel. On the Effective Date, the Administrative
-------------------
Agent shall have received:
(i) from Debevoise & ▇▇▇▇▇▇▇▇, an opinion addressed to the
Administrative Agent, the Collateral Agent and each Lender, dated the
Effective Date, substantially in the form of Exhibit D-1 hereto;
-----------
(ii) from special local counsel to the Credit Parties for
Delaware, Washington and each other State in which any filings are required
to perfect the security interest of the Collateral Agent in any Collateral,
an opinion addressed to the Administrative Agent, the Collateral Agent and
each Lender, dated the Effective Date, substantially in the form of Exhibit
-------
D-2 hereto;
---
(iii) from Debevoise & ▇▇▇▇▇▇▇▇, copies of the opinion delivered
by them as required under the Senior Subordinated Note Documents, including
language to the effect that the Agents and the Lenders are entitled to rely
on such opinions as if they were addressed to the Agents and the Lenders;
and
(iv) from ▇▇▇▇▇▇▇ ▇▇▇▇▇, special maritime counsel to the Credit
Parties, an opinion addressed to the Administrative Agent, the Collateral
Agent and each Lender, dated the Effective Date, substantially in the form
of Exhibit D-3 hereto.
-----------
(e) Capitalization. The Administrative Agent shall be satisfied in its
--------------
reasonable judgment with (i) any changes in the capital and ownership structure
of ASLP and each of its Subsidiaries (including that ASLP will remain the
managing member of Holdings, approximately 90% of the Capital Stock of Holdings
shall be owned by the ASLP, approximately 0.5% of the Capital Stock of Holdings
will be owned by ▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Holdings may have outstanding
options for the purchase of up to 5.0% of its Capital Stock and the remainder of
the Capital Stock of Holdings will be owned by two Affiliates of the Sponsor),
all Capital Stock of the Parent shall be owned by Holdings, all Capital Stock of
ASC shall be owned by the Parent, all Capital Stock of the Borrower shall be
owned by the Parent and by ASC, all Capital Stock of the Borrower's Subsidiaries
shall be owned by the Borrower or one or more of the Borrower's Subsidiaries, in
each case free and clear of any Lien, charge or encumbrance not permitted
hereunder and neither the Parent nor any of its Subsidiaries shall retain any
Capital Stock of or other ownership interest in any member of the PLC Group) and
the corporate or membership arrangements of ASLP, Holdings, the Parent, ASC, the
Borrower and each of the other Credit Parties, including, without limitation,
the limited partnership agreement of ASLP, the operating agreements of each of
Holdings, the Parent and the Borrower, the charter and by-laws of ASC and the
constitutive documents of each other Subsidiary of ASLP and each agreement or
instrument relating thereto, (ii) the issuer(s), amount, tenor and other terms
and conditions of all other equity and debt financings comprising part of the
Transaction (including, without limitation, the Senior Subordinated Notes) and
(iii) evidence received by the Administrative Agent that the Borrower Debt
Refinancing and the Norway Debt Repayments have been or are being simultaneously
consummated.
(f) Transaction. The final terms and conditions of each aspect of the
-----------
Transaction, including, without limitation, all tax aspects thereof, shall be
(i) as described in the Commitment Letter and otherwise consistent with the
description thereof received in writing as part of the Pre-Commitment
Information and (ii) otherwise satisfactory to the Administrative Agent in its
reasonable judgment. All agreements, instruments and documents entered into in
connection with the Recapitalization (the
72
"Recapitalization Documents") shall be satisfactory to the Administrative Agent
--------------------------
in its reasonable judgment. All conditions precedent to the consummation of each
aspect of the Transaction shall have been satisfied or, with the prior written
approval of the Administrative Agent, waived and each aspect of the
Recapitalization shall have been consummated in accordance with the
Recapitalization Documents, none of which shall be been altered, amended or
otherwise changed or supplemented or any condition therein waived without the
prior written consent of the Administrative Agent.
(g) Refinancing of Certain Existing Debt; Other Debt. On the Effective
------------------------------------------------
Date, the commitments under all Refinanced Agreements shall have been
terminated, all loans outstanding thereunder shall have been repaid in full,
together with accrued interest thereon (including, without limitation, any
prepayment premium), all letters of credit issued thereunder shall have been
terminated or shall have been continued hereunder or backstopped by Letters of
Credit issued hereunder and all other amounts owing pursuant to each Refinanced
Agreement shall have been repaid in full, and the Administrative Agent shall
have received evidence in form, scope and substance satisfactory to it that the
matters set forth in this subsection (g) have been satisfied at such time. In
--------------
addition, on the Effective Date, the creditors under each Refinanced Agreement
(other than the Original Credit Agreement) shall have terminated and released
all applicable Liens on the capital stock of and assets owned by the Parent and
its Subsidiaries and the Administrative Agent shall have received all such
releases as may have been requested by the Administrative Agent, which releases
shall be in form and substance satisfactory to the Administrative Agent. After
the consummation of the transactions contemplated by the Recapitalization on the
Effective Date, the Consolidated Parties shall have no material liabilities
(actual or contingent) or Preferred Stock that would be required to be disclosed
in a consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries prepared in accordance with GAAP, except (i) as disclosed in the
most recent interim balance sheet included in the financial statements delivered
pursuant to subsection (c) above, (ii) for accounts payable incurred in the
--------------
ordinary course of business consistent with past practice since the date of the
most recent interim balance sheet included in the financial statements delivered
pursuant to subsection (s) below, (iii) Debt under the Credit Documents and the
--------------
Senior Subordinated Notes and (iv) the Existing Debt.
(h) Perfection of Personal Property Security Interests and Pledges;
--------------------------------------------------------------
Search Reports. On or prior to the Effective Date, the Collateral Agent shall
--------------
have received:
(i) a Perfection Certificate from each Credit Party;
(ii) appropriate financing statements (Form UCC-1 or such other
financing statements or similar notices as shall be required by local law)
fully executed for filing under the Uniform Commercial Code or other
applicable local law of each jurisdiction in which the filing of a
financing statement or giving of notice may be required, or reasonably
requested by the Collateral Agent, to perfect the security interests
intended to be created by the Collateral Documents;
(iii) copies of reports from CT Corporation System or other
independent search service reasonably satisfactory to the Collateral Agent
listing all effective financing statements that name the Parent, the
Borrower, any other Credit Party as such, (under its present name and any
previous name and, if requested by the Collateral Agent, under any trade
names) as debtor or seller that are filed in the jurisdictions referred to
in clause (ii) above, together with copies of such financing statements
-----------
(none of which shall cover the Collateral except to the extent evidencing
Permitted Liens or for which the Collateral Agent shall have received
termination statements (Form UCC-3 or such other termination statements as
shall be required by local law) fully executed for filing);
73
(iv) searches of ownership of intellectual property in the
appropriate governmental offices and such patent/trademark/copyright
filings as requested by the Collateral Agent to the extent necessary or
advisable to perfect the Lender's security interest in intellectual
property Collateral;
(v) all of the Pledged Collateral, which Pledged Collateral shall
be in suitable form for transfer by delivery, or shall be accompanied by
duly executed instruments of transfer or assignment in blank, with
signatures appropriately guaranteed, accompanied in each case by any
required transfer tax stamps, all in form and substance satisfactory to the
Collateral Agent; and
(vi) evidence of the completion of all other filings and
recordings of or with respect to the Collateral Documents and of all other
actions as may be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the security interests intended to be created by the
Collateral Documents.
(i) Vessel Mortgages and Fishing Rights. The Collateral Agent shall
-----------------------------------
have received (in form and substance satisfactory to the Collateral Agent):
(i) current Abstracts of Title and Certificates of Documentation,
certified as true and complete by the U.S. Coast Guard, for each of the
Vessels with evidence that each Vessel has a fishery endorsement, together
with copies of all recorded documents related to outstanding Liens, title
issues or vessel documentation issues revealed by such Abstracts of Title
or Certificates of Documentation as reasonably requested by the
Administrative Agent;
(ii) documentation relating to the termination or nonexistence of
all defects, Liens and Vessel documentation issues not reasonably
acceptable to the Administrative Agent, other than to the extent
constituting Permitted Liens;
(iii) copies of valid and current limited entry or other Permits
and licenses issued by (A) the State of Alaska, if any, and (B) the
National Marine Fisheries Service sufficient to permit the conduct of the
Business in 2002 substantially as conducted in 2001, subject to applicable
regulatory limits;
(iv) copies of current charters, if any, for each of the Vessels,
certified as true and complete by each Vessel owner, together with estoppel
certificates verifying that the charter agreements are not in default;
(v) documentation in form and substance satisfactory to the
Collateral Agent which assigns a collateral interest in the Vessel
charters, if applicable;
(vi) a description of all pending suits, claims or other actions
which may constitute or create a Lien against the Vessels or Fishing
Rights, together with documentation regarding insurance and indemnity
coverage for existing claims, except with respect to such suits, claims or
other actions that would not reasonably be expected to have a Material
Adverse Effect;
(vii) receipt of all Fishing Rights Agreements, certified as true
and complete by the Borrower, together with evidence satisfactory to the
Collateral Agent of the completion of all actions as may be necessary or,
in the opinion of the Collateral Agent, desirable to perfect the security
interests in favor of the Lenders in the Fishing Rights Agreements; and
74
(viii) the duly executed and delivered Vessel Mortgages on the
Vessels, and evidence of the completion of all filings and recordings of or
with respect to the Vessel Mortgages and the other Collateral Documents
pertinent to the Fishing Rights and of all other actions as may be
necessary or, in the opinion of the Collateral Agent, desirable to perfect
the security interests intended to be created by the Vessel Mortgages and
such Collateral Documents.
(j) Evidence of Insurance. Receipt by the Collateral Agent of copies
---------------------
of insurance policies or certificates of insurance of the Credit Parties and
their subsidiaries evidencing liability and casualty insurance meeting the
requirements set forth in the Credit Documents, including, but not limited to,
naming the Collateral Agent as additional insured and sole loss payee on behalf
of the Lenders.
(k) Material Adverse Effect. Except as set forth in Schedule 5.02,
----------------------- -------------
there shall not have occurred since December 31, 2001 any development or event
relating to or affecting a Credit Party or any of their Subsidiaries which could
reasonably expected to have (i) any material adverse effect upon the condition
(financial or otherwise), operations, properties, assets, liabilities (actual
and contingent), business, management or prospects of the Borrower and its
Consolidated Subsidiaries taken as a whole, (ii) a material adverse effect on
the ability of the Credit Parties, taken as a whole, to perform their
obligations under this Agreement, the Notes and the other Credit Documents or
(iii) a material adverse effect on the rights and remedies of the Administrative
Agent, the Collateral Agent and Lenders under this Agreement, the Notes and the
other Credit Documents.
(l) Approvals. On the Effective Date, all governmental (domestic or
---------
foreign) (including the Department of Transportation, Maritime Administration),
regulatory and third party approvals necessary or, in the reasonable judgment of
the Administrative Agent advisable in connection with the transactions
contemplated by the Transaction Documents and otherwise referred to herein or
therein shall have been obtained and remain in full force and effect (it being
understood that, with respect to the Department of Transportation, Maritime
Administration, the Borrower shall have received a letter from the Department of
Transportation, Maritime Administration substantially similar to the letter
dated January 28, 2002 previously delivered to the Administrative Agent, and no
law or regulation shall be applicable which in the reasonable judgment of the
Administrative Agent could reasonably be expected to restrain, prevent or impose
any material adverse conditions on any of the Credit Parties or the Transaction
or such other transaction.
(m) Litigation; Judgments. Except as set forth in Schedule 5.09, on
--------------------- -------------
the Effective Date, there shall be no actions, suits, proceedings or
investigations pending or, to the knowledge of the Credit Parties, threatened
(i) with respect to this Agreement or any other Transaction Document or the
transactions contemplated hereby or thereby or (ii) which the Administrative
Agent or the Required Lenders shall reasonably determine would reasonably be
expected to have a Material Adverse Effect. Additionally, there shall not exist
any judgment, order, injunction or other restraint issued or filed or a hearing
seeking injunctive relief or other restraint pending or notified prohibiting or
imposing materially adverse conditions upon the consummation of the transactions
contemplated by the Transaction Documents and otherwise referred to herein or
therein.
(n) Solvency Opinion. On or prior to the Effective Date, the Borrower
----------------
shall have delivered or caused to be delivered to the Administrative Agent a
solvency opinion from an independent valuation firm acceptable to the
Administrative Agent a satisfactory opinion as to the financial condition of
ASLP, the Parent and each of the Credit Parties, setting forth the conclusions
that, after giving effect to the Recapitalization, the issuance of the Senior
Subordinated Notes, the consummation of all other aspects of the Transaction and
the consummation of all financings contemplated herein, the Consolidated Parties
(on a consolidated basis but including their respective Consolidated
Subsidiaries) and the Borrower (on a stand-alone basis) are not insolvent and
will not be rendered insolvent by the indebtedness incurred in
75
connection herewith, will not be left with unreasonably small capital with which
to engage in its respective business and will not have incurred debts beyond its
ability to pay as such debts mature and become due.
(o) Appointment of Agent for Service of Process. The Administrative
-------------------------------------------
Agent shall be satisfied that appropriate arrangements are in place for the
appointment of CT Corporation System, presently located at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its agent to receive service of process as specified in
Section 10.11 hereof.
-------------
(p) Payment of Fees. All costs, fees and expenses due to the
---------------
Administrative Agent, the Collateral Agent and the Lenders on or before the
Effective Date incurred in connection with the Commitment Letter, the Fee Letter
and the Transaction shall have been paid.
(q) Counsel Fees. The Administrative Agent shall have received full
------------
payment from the Borrower of the reasonable and documented fees and expenses of
Mayer, Brown, ▇▇▇▇ & Maw described in Section 10.03 which are billed through the
-------------
Effective Date incurred in connection with the Commitment Letter, the Fee Letter
and the Transaction.
(r) Revolving Availability. After giving effect to all Credit Events
----------------------
occurring on the Effective Date, the aggregate unused Revolving Commitments
shall exceed the aggregate amount of all Revolving Outstandings by at least
$60,000,000, except with the prior written consent of the Administrative Agent.
(s) Officer's Certificates. The Administrative Agent shall have
----------------------
received a certificate or certificates executed by a Responsible Officer of the
Borrower on behalf of the Credit Parties as of the Effective Date stating that
(A) the Credit Parties and each of their Subsidiaries are in compliance with all
existing material financial obligations, (B) the conditions set forth in clauses
-------
(f), (k) and (m) of this Section 4.01 have been satisfied, (C) the Projections
--- --- --- ------------
(as defined in Section 4.01(c)) were prepared in good faith and using reasonable
----------------
assumptions and (D) immediately after giving effect to this Agreement, the other
Credit Documents and all the transactions contemplated therein to occur on such
date, (1) each Credit Party is Solvent, (2) no Default or Event of Default
exists, (3) all representations and warranties contained herein and in the other
Credit Documents are true and correct in all material respects, and (4) the
Credit Parties are in compliance with each of the financial covenants set forth
in Section 7.18.
------------
(t) Other. The Administrative Agent shall have received such other
-----
documents, instruments, agreements or information as may be reasonably requested
by the Administrative Agent.
(u) No Violation. Neither Holdings, the Borrower nor any of the other
------------
Credit Parties shall be in breach or violation in any material respect of any of
their respective obligations under the Commitment Letter or the Fee Letter, nor
shall Holdings, the Borrower or any of the other Credit Parties, or any of their
respective Affiliates, have failed to comply with any of the requirements of the
Commitment Letter or of the related Fee Letter in any material respect.
(v) Full Disclosure. All of the Pre-Commitment Information shall be
---------------
complete and correct in all material respects; and no changes or developments
shall have occurred, and no new or additional information, shall have been
received or discovered by the Administrative Agent or the Lenders regarding the
Credit Parties or the Transaction after the date of the Commitment Letter that,
either individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(w) Intercompany and Existing Debt. The Administrative Agent shall be
------------------------------
satisfied with the amount, terms, conditions and holders of all intercompany
Debt and all Debt and other material
76
liabilities of any of the Credit Parties owing to third parties to be
outstanding on and after the Effective Date.
(x) Appraisals. The Administrative Agent shall have received, in form
----------
and substance reasonably satisfactory to it, vessel survey reports as of a date
proximate to the Effective Date on each vessel.
(y) Vessels. The Administrative Agent shall have received satisfactory
-------
evidence that, as to each Vessel included in the Collateral, (1) each Vessel has
a fisheries endorsement and is owned and controlled by citizens of the United
States as required by the AFA and regulations promulgated thereunder and meets
all requirements to maintain such other endorsements as each Vessel may have,
(2) each Vessel and owner have a record of operations and activities reasonably
satisfactory to Administrative Agent to assure its continuing right to engage in
the fisheries in which it has historically participated, (3) the Transaction and
the occurrence of the Effective Date shall not adversely affect the ownership or
control of each such Vessel under the AFA nor such Vessel's nor owner's
continuing right to engage in the fisheries in which it has historically
participated and (4) the Transaction and occurrence of the Effective Date shall
result in Administrative Agent (or a Collateral Agent or trustee on its behalf)
having preferred marine mortgages on each Vessel so long as any Obligations
remain outstanding hereunder and under the other Credit Documents; and all
filing and recording fees and taxes shall have been duly paid and any surveys,
title insurance, landlord waivers and access letters requested by the
Administrative Agent with respect to real property interests of the Parent and
its Subsidiaries shall have been obtained.
(z) Senior Subordinated Notes. The Administrative Agent shall have
-------------------------
received satisfactory evidence of receipt by the Borrower of not less than
$175,000,000 gross cash proceeds from the issuance and sale by the Borrower of
the Senior Subordinated Notes, which Senior Subordinated Notes shall have
received a debt rating of not less than B3 by ▇▇▇▇▇'▇ and B- by S&P, in each
case with at least a "stable outlook" by said rating agencies.
All corporate and legal proceedings and instruments and agreements
relating to the transactions contemplated by this Agreement and the other
Transaction Documents or in any other document delivered in connection herewith
or therewith shall be satisfactory in form and substance to the Administrative
Agent and its counsel, and the Administrative Agent shall have received all
information and copies of all documents and papers, including records of
corporate proceedings, governmental approvals, good standing certificates and
bring-down telegrams, if any, which the Administrative Agent reasonably may have
requested in connection therewith, such documents and papers where appropriate
to be certified by proper corporate or governmental authorities. The documents
referred to in this Section shall be delivered to the Administrative Agent no
later than the Effective Date. The certificates and opinions referred to in this
Section shall be dated the Effective Date.
On the Effective Date, the Original Credit Agreement will be
automatically amended and restated in its entirety to read as set forth herein.
On and after the Effective Date, the rights and obligations of the parties
hereto shall be governed by this Agreement; provided that the rights and
obligations of the parties hereto with respect to the period prior to the
Effective Date shall continue to be governed by the provisions of the Original
Credit Agreement. Once the Effective Date has occurred, all references to the
Original Credit Agreement in any document, instrument, agreement, or writing
shall from and after the Effective Date be deemed to refer to this Agreement,
and, as used in this Agreement, the terms, "herein", "hereunder", "hereto", and
words of similar import shall mean, from and after the Effective Date, this
Agreement. Promptly after the Effective Date occurs, the Administrative Agent
shall notify the Borrower and the Lenders of the Effective Date, and such notice
shall be conclusive and
77
binding in all parties hereto. If the Effective Date does not occur before April
30, 2002, the Commitments shall terminate at the close of business on such date.
Section 4.02 Conditions to All Credit Events. The obligation of any
-------------------------------
Lender to make a Loan on the occasion of any Borrowing, and the obligation of
any Issuing Lender to issue (or renew or extend the term of) any Letter of
Credit, is subject to the satisfaction of the following conditions:
(a) Notice. The Borrower shall have delivered (i) in the case of any
------
Revolving Loan, Tranche A Term Loan or Tranche B Term Loan, to the
Administrative Agent, an appropriate Notice of Borrowing, duly executed and
completed, by the time specified in Section 2.01, 2.03 or 2.04, as applicable
------------ ---- ----
(ii) in the case of any Letter of Credit, to the Issuing Lender, an appropriate
Letter of Credit Request, duly executed and completed, in accordance with the
provisions of Section 2.02, and (iii) in the case of any Swingline Loan, to the
------------
Swingline Lender, a Swingline Loan Request, duly executed and completed, by the
time specified in Section 2.05.
------------
(b) Representations and Warranties. The representations and warranties
------------------------------
made by the Credit Parties in any Credit Document are true and correct in all
material respects at and as if made as of such date except to the extent they
expressly relate to an earlier date.
(c) No Default. No Default or Event of Default shall exist or be
----------
continuing either prior to or after giving effect thereto.
(d) Availability. Immediately after giving effect to the making of a
------------
Loan (and the application of the proceeds thereof) or to the issuance of a
Letter of Credit, as the case may be, (i) the sum of the Revolving Loans
outstanding plus LOC Obligations outstanding plus Swingline Loans outstanding
shall not exceed the Revolving Commitment Amount, (ii) the sum of LOC
Obligations outstanding shall not exceed the LOC Committed Amount and (iii) the
sum of Swingline Loans outstanding shall not exceed the Swingline Committed
Amount.
(e) Term Borrowings. In the case of the initial Revolving Borrowing,
---------------
the fact that prior to, or concurrently with, such Revolving Borrowing, the
Borrower shall have made the Tranche A Term Loan Borrowing and Tranche B Term
Loan Borrowing in the full amount of the Tranche A Term Loan Commitments and the
Tranche B Term Loan Commitments, respectively.
The delivery of each Notice of Borrowing, Swingline Loan Request and
each request for a Letter of Credit shall constitute a representation and
warranty by the Credit Parties of the correctness of the matters specified in
subsections (b), (c) and (d) above. This Section 4.02 shall not apply to
--------------- --- --- ------------
continuations or conversions of Loans made pursuant to Section 3.02.
------------
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Each of the Parent and the Borrower represents and warrants, after
giving effect to the consummation of the Recapitalization on the Effective Date,
that:
Section 5.01 Financial Condition.
-------------------
(a) Audited Financial Statements. The audited annual financial
----------------------------
statements referred to in Section 4.01(c), copies of which have been delivered
---------------
to each of the Lenders, have been examined by the independent certified public
accountants whose reports thereon are included with such financial statements.
Except as set forth on Schedule 5.01, all such financial statements have been
-------------
prepared in
78
conformity with GAAP applied on a consistent basis (except for changes, if any,
required by GAAP and disclosed therein). Except as set forth on Schedule 5.01,
-------------
the statements of operations and cash flow included in such financial statements
present fairly in all material respects, in accordance with GAAP the results of
operations and cash flows of the pertinent entity or business for the respective
periods covered, and the balance sheets included in such financial statements
present fairly in all material respects, in accordance with GAAP, the financial
condition of the pertinent entity or business as of their respective dates.
(b) Interim Financial Statements. Except as set forth on Schedule
---------------------------- --------
5.01, the unaudited interim financial statements referred to in Section 4.01(c),
---- ---------------
copies of which have been delivered to each of the Lenders, have been prepared
in conformity with GAAP applied on a consistent basis with the financial
statements referred to in subsection (a) of this Section, except for changes, if
--------------
any, required by GAAP and disclosed therein. Except as set forth on Schedule
--------
5.01, the statements of profits and losses included in such interim financial
----
statements present fairly in all material respects, in accordance with GAAP the
results of operations of the pertinent entity or business for the respective
periods covered (subject to normal year-end adjustments resulting from audit),
and the balance sheets included in such interim financial statements present
fairly in all material respects, in accordance with GAAP, the financial
condition of the pertinent entity or business as of their respective dates
(subject to normal year-end adjustments resulting from audit). Except as
described on Schedule 5.01, the balance sheets and the notes thereto included in
-------------
the financial statements referred to in this subsection (b) and in subsection
-------------- ----------
(a) above disclose all material liabilities, actual or contingent, of the Parent
---
and its Subsidiaries as of the dates thereof.
(c) Pro-Forma Financial Statements. The pro-forma financial statements
------------------------------
and the consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of the most recent fiscal month prior to the
Effective Date for which financial information is available (the "Pro-Forma
---------
Balance Sheet"), prepared on a pro-forma basis as of December 31, 2001 assuming
-------------
that the transactions contemplated by the Transaction Documents had actually
occurred on such date, have heretofore been furnished to each Lender as part of
the Pre-Commitment Information. The pro-forma financial statements delivered
pursuant to Section 4.01(c) have been prepared in accordance with the standards
---------------
and methodology utilized by the independent certified public accountants whose
reports are included in the financial statements referred to in subsection (a)
--------------
above. The Pro-Forma Balance Sheet has been prepared in good faith by the
Borrower, based on the assumptions used to prepare the pro-forma financial
information contained in the Pre-Commitment Information (which assumptions are
believed by the Borrower on the date hereof and on the Effective Date to be
reasonable), is based on the best information available to the Borrower as of
the date of delivery thereof, accurately reflects all material adjustments
required to be made to give effect to the transactions contemplated by the
Transaction Documents and presents fairly on a pro-forma basis the estimated
consolidated financial position of the Borrower and its Consolidated
Subsidiaries as of December 31, 2001, assuming that the transactions
contemplated by the Transaction Documents had actually occurred on that date.
None of the Consolidated Parties has any reason to believe that such pro-forma
balance sheet is misleading in any material respect in light of the
circumstances existing at the time of the preparation thereof.
(d) Projections. The Projections are based on good faith estimates and
-----------
assumptions made by management of the Borrower. On the Effective Date, such
management believed that the Projections were reasonable and attainable, it
being recognized by the Lenders, however, that projections as to future events
are not to be viewed as facts and that actual results during the period or
periods covered by the Projections may differ from the projected results and
that such differences may be material.
79
(e) No Undisclosed Liabilities. Except as fully reflected in the
--------------------------
financial statements described in subsection (a) above and for items disclosed
--------------
on Schedule 5.01 hereof and the Debt incurred under this Agreement and the
-------------
Senior Subordinated Notes, (i) there were as of the Effective Date (and after
giving effect to any Loans made and Letters of Credit issued or continued on
such date), no liabilities or obligations (excluding current obligations and
liabilities incurred in the ordinary course of business) with respect to any
Consolidated Party of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether or not due and including obligations or
liabilities for taxes, long-term leases and unusual forward or other long-term
commitments) that would be required to be disclosed in a consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries prepared in accordance
with GAAP, and (ii) as of the Effective Date, none of the Parent, or the
Borrower knows of any basis for the assertion against any Consolidated Party of
any such liability or obligation which, either individually or in the aggregate,
are or would reasonably be expected to have a Material Adverse Effect.
(f) Post-Closing Financial Statements. The financial statements
---------------------------------
delivered to the Lenders pursuant to Section 6.01(a) and (b), if any, (i) have
--------------- ---
been prepared in accordance with GAAP (except as may otherwise be permitted
under Section 6.01(a) and (b)) and (ii) present fairly in all material respects
--------------- ---
(on the basis disclosed in the footnotes to such financial statements, if any)
the financial condition, results of operation and cash flows of the Borrower and
its Consolidated Subsidiaries as of the respective dates thereof and for the
respective periods covered thereby.
Section 5.02 No Material Change. Except as set forth in Schedule 5.02,
------------------ -------------
since December 31, 2001, there has been (i) no change in or event affecting the
Borrower and its Subsidiaries or the Business that has had or may reasonably be
expected to have a material adverse effect on the Business, taken as a whole,
and (ii) no material adverse change in the condition (financial or otherwise),
results of operations, properties, assets or business of the Borrower and its
Consolidated Subsidiaries, considered as a whole, other than changes relating to
the economy in general, and no development or event relating to or affecting any
Consolidated Party which has had or would reasonably be expected to have a
Material Adverse Effect. From and after the Effective Date, except as otherwise
permitted under this Agreement, no Restricted Payments have been declared, paid
or made upon the Capital Stock or other equity interest in any Consolidated
Party nor has any of the Capital Stock or other equity interest in any
Consolidated Party been redeemed, retired, purchased or otherwise acquired for
value.
Section 5.03 Organization and Good Standing. Each of the Consolidated
------------------------------
Parties is a corporation or limited liability company duly formed, validly
existing and in good standing under the laws of the jurisdiction of its
formation, has all corporate or limited liability company powers, as the case
may be, and all governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted, except where the failure to
have such licenses, authorizations, consents or approvals would not reasonably
be expected to have a Material Adverse Effect, and is duly qualified as a
foreign corporation or limited liability company, as applicable, licensed and in
good standing in each jurisdiction where qualification or licensing is required
by the nature of its business or the character and location of its property,
business or customers and in which the failure to so qualify or be licensed, as
the case may be, in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.
Section 5.04 Power; Authorization; Enforceable Obligations. Each of
---------------------------------------------
the Credit Parties has the corporate or other necessary power and authority, and
the legal right to execute, deliver and perform the Transaction Documents to
which it is a party and, in the case of the Borrower, to obtain extensions of
credit hereunder, and has taken all necessary action to authorize the borrowings
and other extensions of credit on the terms and conditions of this Agreement and
to authorize the execution, delivery and performance of the Transaction
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other similar act by or in respect of, any Governmental Authority
or any other Person is required to be obtained or made by or on behalf of any
Credit Party in connection
80
with the borrowings or other extensions of credit hereunder or with the
execution, delivery, performance, validity or enforceability of the Transaction
Documents, except (i) for consents, authorizations, notices and filings
disclosed in Schedule 5.04, all of which have been obtained or made, (ii) where
-------------
the failure to obtain such consents would not reasonably be expected to have a
Material Adverse Effect, and (iii) filings to perfect the Liens created by the
Collateral Documents. This Agreement has been, and each other Transaction
Document to which any Credit Party is a party will be, duly executed and
delivered on behalf of such Person. This Agreement constitutes, and each other
Transaction Document to which any Credit Party is a party when executed and
delivered will constitute, a legal, valid and binding obligation of such Person,
enforceable against such Person in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by equitable principles of general applicability
(whether enforcement is sought by proceedings in equity or at law or in
admiralty).
Section 5.05 No Conflicts. Neither the execution and delivery by any
------------
Credit Party of the Transaction Documents to which it is a party, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Person, nor the
exercise of remedies by the Agents and the Lenders under the Credit Documents,
will (i) violate or conflict with any provision of its articles or certificate
of incorporation or bylaws or other organizational or governing documents of
such Person, (ii) (x) violate, contravene or conflict with Regulation U or
Regulation X or (y) violate, contravene or conflict with any Requirement of Law
applicable to it or its properties, except, solely with respect to this
subclause (y), for violations, contraventions or conflicts that would not
-------------
reasonably be expected to have a Material Adverse Effect, (iii) violate,
contravene or conflict with contractual provisions of, cause an event of default
under, or give rise to material increased, additional, accelerated or
guaranteed, rights of any Person under, any indenture, loan agreement, mortgage,
deed of trust, contract or other agreement or instrument to which it is a party
or by which it may be bound, except for violations, contraventions or conflicts
that would not reasonably be expected to have a Material Adverse Effect, or (iv)
result in or require the creation of any Lien (other than the Lien of the
Collateral Documents or other Permitted Liens) upon or with respect to its
properties.
Section 5.06 No Default. None of the Consolidated Parties is in
----------
default in any respect under any loan agreement, indenture, mortgage, security
agreement or other agreement relating to Debt or any other contract, lease,
agreement or obligation to which it is a party or by which any of its properties
is bound which default would reasonably be expected to have a Material Adverse
Effect. No Default or Event of Default has occurred and is continuing.
Section 5.07 Assets. Each Consolidated Party is the owner of, and has
------
good and marketable title to, all of its respective assets and none of such
assets is subject to any Lien other than Permitted Liens. As of the Effective
Date, after giving effect to consummation of the transactions contemplated by
the Transaction Documents, the Credit Parties do not own any properties used in
the business of, or as Capital Stock of, any member of the PLC Group.
Section 5.08 Debt. Except as permitted under Section 7.01, the
---- ------------
Consolidated Parties have no Debt.
Section 5.09 Litigation. Except as disclosed in Schedule 5.09, there
---------- -------------
are no actions, suits, investigations or legal, equitable, arbitration or
administrative proceedings pending for which service of process or other written
notice has been received or, to the knowledge of any Credit Party, threatened
against or affecting any Consolidated Party which would reasonably be expected
to have a Material Adverse Effect.
81
Section 5.10 Taxes. Each Consolidated Party has filed, or caused to be
-----
filed, all material tax returns (including federal, state, local and foreign tax
returns) required to be filed and paid (i) all amounts of taxes shown thereon to
be due (including interest and penalties) and (ii) all fees, assessments and
other governmental charges owing by it, except for such amounts (x) which are
not yet delinquent or (y) that are being contested in good faith and by proper
proceedings diligently pursued, and against which adequate reserves are being
maintained in accordance with GAAP. Except as set forth on Schedule 5.10, no
-------------
Credit Party knows of any pending investigation of such party by any taxing
authority or proposed tax assessments against it or any Consolidated Party.
Section 5.11 Compliance with Law. Except as set forth on Schedule
------------------- --------
5.11, each Consolidated Party is in compliance with all Requirements of Law
----
(excluding Environmental Laws) and the AFA applicable to it or to its
properties, except for any such failure to comply which could not reasonably be
expected to cause a Material Adverse Effect. To the knowledge of the Credit
Parties, none of the Consolidated Parties or any of their respective material
properties or assets is subject to or in default with respect to any judgment,
writ, injunction, decree or order of any court or other Governmental Authority.
Except as disclosed in Schedule 5.11, none of the Consolidated Parties has
-------------
received any written communication in the 12 months prior to the Effective Date
from any Governmental Authority that alleges that any of the Consolidated
Parties is not in compliance in any material respect with any Requirement of
Law, except for allegations that have been satisfactorily resolved and are no
longer outstanding.
Section 5.12 ERISA. Except as disclosed in Schedule 5.12:
----- -------------
(a) As of the Effective Date, no Consolidated Party maintains,
operates or funds any Multi-Employer Plan or Multiple Employer Plan.
(b) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has occurred, and, to
the knowledge of the Credit Parties, no event or condition has occurred or
exists as a result of which any ERISA Event could reasonably be expected to
occur, with respect to any Plan; (ii) no "accumulated funding deficiency," as
such term is defined in Section 302 of ERISA and Section 412 of the Code,
whether or not waived, has occurred with respect to any Single Employer Plan;
(iii) each Single Employer Plan and, to the knowledge of the Credit Parties,
each Multiemployer Plan has been maintained, operated, and funded in compliance
with its own terms and in material compliance with the provisions of ERISA, the
Code, and any other applicable federal or state laws; and (iv) no Lien in favor
of the PBGC or a Plan has arisen or is reasonably likely to arise on account of
any Plan.
(c) The actuarial present value of all "benefit liabilities" (as
defined in Section 4001(a)(16) of ERISA), whether or not vested, under each
Single Employer Plan, as of the last annual valuation date prior to the date on
which this representation is made or deemed made (determined, in each case, in
accordance with Financial Accounting Standards Board Statement 87, utilizing the
actuarial assumptions used in such Plan's most recent actuarial valuation
report), did not exceed as of such valuation date the fair market value of the
assets of such Plan by greater than $25,000,000.
(d) None of the Consolidated Parties or any ERISA Affiliate has
incurred and has outstanding, or, to the knowledge of the Credit Parties, could
be reasonably expected to incur, any withdrawal liability under ERISA to any
Multiemployer Plan or Multiple Employer Plan. None of the Consolidated Parties
or any ERISA Affiliate would become subject to any material withdrawal liability
under ERISA if the Consolidated Parties or any ERISA Affiliate were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as of the
valuation date most closely preceding the date on which this representation is
made or deemed made. None of the Consolidated Parties or any
82
ERISA Affiliate has received any notification that any Multiemployer Plan is in
reorganization (within the meaning of Section 4241 of ERISA), is insolvent
(within the meaning of Section 4245 of ERISA), or has been terminated (within
the meaning of Title IV of ERISA), and no Multiemployer Plan is, to the
knowledge of the Credit Parties, reasonably expected to be in reorganization,
insolvent or terminated.
(e) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility has
occurred with respect to a Plan which has subjected or may subject any
Consolidated Party or any ERISA Affiliate to any liability under Section 406,
409, 502(i) or 502(l) of ERISA or Section 4975 of the Code, or under any
agreement or other instrument pursuant to which any Consolidated Party or any
ERISA Affiliate has agreed or is required to indemnify any Person against any
such liability except for any transaction or breach that would not reasonably be
expected to have a Material Adverse Effect.
(f) None of the Consolidated Parties or any ERISA Affiliate has any
material liability with respect to "expected post-retirement benefit
obligations" within the meaning of the Financial Accounting Standard Board
Statement 106. Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601 through 609 of ERISA and Section 4980B of the Code
apply has been administered in compliance in all material respects of such
sections.
(g) Neither the execution and delivery of this Agreement nor the
consummation of the financing transactions contemplated hereunder will involve
any transaction which is subject to the prohibitions of Sections 404, 406 or 407
of ERISA or in connection with which a tax could be imposed pursuant to Section
4975 of the Code. The representation in the preceding sentence is made in
reliance upon and subject to the accuracy of the Lenders' timely representation
in Section 10.17 with respect to their source of funds and is subject, in the
-------------
event that the source of the funds used by the Lenders in connection with this
transaction is an insurance company's general asset account, to the application
of Prohibited Transaction Class Exemption 95-60, 60 Fed. Reg. 35,925 (1995),
compliance with the regulations issued under Section 401(c)(1)(A) of ERISA, or
the issuance of any other prohibited transaction exemption or similar relief, to
the effect that assets in an insurance company's general asset account do not
constitute assets of an "employee benefit plan" within the meaning of Section
3(3) of ERISA of a "plan" within the meaning of Section 4975(e)(1) of the Code.
Section 5.13 Subsidiaries. Schedule 5.13 sets forth a complete and
------------ -------------
accurate list as of the Effective Date of all Subsidiaries of the Parent.
Schedule 5.13 sets forth as of the Effective Date the jurisdiction of formation
-------------
of each such Subsidiary, the number of authorized shares of each class of
Capital Stock of each such Subsidiary, the number of outstanding shares of each
class of Capital Stock, the number and percentage of outstanding shares of each
class of Capital Stock of each such Subsidiary directly owned by any Person; and
the number and effect, if exercised, of all Equity Equivalents with respect to
Capital Stock of each such Subsidiary. All the outstanding Capital Stock of each
Subsidiary of the Parent is validly issued, fully paid and non-assessable and,
as of the Effective Date, is owned by the Parent, directly or indirectly, free
and clear of all Liens (other than those arising under the Collateral
Documents). Other than as set forth in Schedule 5.13, as of the Effective Date
-------------
no such Subsidiary has outstanding any Equity Equivalents with respect to its
Capital Stock nor does any such Person have outstanding any rights to subscribe
for or to purchase or any options for the purchase of, or any agreements
providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its Capital Stock. The
Parent has no Subsidiaries, other than ASC and the Borrower and its
Subsidiaries.
Section 5.14 Governmental Regulations, Etc. (a) No part of the Letters
-----------------------------
of Credit or proceeds of the Loans will be used, directly, or indirectly, for
the purpose of purchasing or carrying any "Margin Stock" within the meaning of
Regulation U. If requested by any Lender or the Administrative
83
Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
U-1 referred to in Regulation U. No indebtedness being reduced or retired out of
the proceeds of the Loans was or will be incurred for the purpose of purchasing
or carrying any Margin Stock within the meaning of Regulation U or any "margin
security" within the meaning of Regulation T. "Margin Stock" within the meaning
of Regulation U does not constitute more than 25% of the value of the
consolidated assets of the Consolidated Parties. None of the transactions
contemplated by this Agreement (including the direct or indirect use of the
proceeds of the Loans) will violate or result in a violation of the Securities
Act, as amended, the Exchange Act or regulations issued pursuant thereto, or
Regulation T, U or X.
(b) None of the Consolidated Parties is subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act or the
Investment Company Act of 1940, each as amended. In addition, none of the
Consolidated Parties is (i) an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, (ii) controlled
by such a company, or (iii) a "holding company", a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a "subsidiary"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1934, as amended.
(c) No director, executive officer or principal holder of Capital
Stock of the Parent or any of its Subsidiaries is a director, executive officer
or principal shareholder of any Lender. For the purposes hereof, the terms
"director", "executive officer" and "principal shareholder" (when used with
reference to any Lender) have the respective meanings assigned thereto in
Regulation O issued by the Board of Governors of the Federal Reserve System.
(d) Each of the Consolidated Parties has obtained and holds in full
force and effect all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of way and
other rights, consents and approvals, which are necessary for the ownership of
its respective property and to the conduct of its respective businesses as
presently conducted, except where the failure to obtain such franchises,
licenses, permits, certificates, authorizations, qualifications, accreditations,
easements, rights of way and other rights, consents and approvals would not
reasonably be expected to have a Material Adverse Effect.
(e) Each of the Consolidated Parties is current with all material
reports and documents, if any, required to be filed with any state or federal
securities commission or similar agency and is in full compliance in all
materials respect with all applicable rules and regulations of such commissions.
Section 5.15 Purpose of Loans and Letters of Credit. The proceeds of
--------------------------------------
the Tranche A Term Loans, the Tranche B Term Loans and any Revolving Loans made
on the Effective Date, together with the proceeds of the Senior Subordinated
Notes, will be used solely to refinance the Loans outstanding under the Original
Credit Agreement, to repay all amounts outstanding under the ASC Norway Note, to
make the Special Distribution and to pay fees and expenses incurred in
connection with the transactions contemplated by the Transaction Documents. The
proceeds of the Revolving Loans and Swingline Loans made after the Effective
Date will be used solely to provide for the working capital requirements of the
Borrower and its Subsidiaries and for the general corporate purposes of the
Borrower and its Subsidiaries, including Permitted Acquisitions. The Letters of
Credit shall be used only for or in connection with appeal bonds, reimbursement
obligations arising in connection with surety and reclamation bonds,
reinsurance, domestic or international trade transactions and other obligations
relating to transactions entered into by the Borrower and its Subsidiaries in
the ordinary course of business.
Section 5.16 Environmental Matters. Except as disclosed in Schedule
--------------------- --------
5.16:
----
84
(a) To the knowledge of the Credit Parties, each of the facilities and
properties owned, leased or operated by any Consolidated Party (the "Company
-------
Properties") and all operations at the Company Properties are in compliance with
----------
all applicable Environmental Laws except for such non compliance that would not
reasonably be expected to have a Material Adverse Effect, and there is no
violation of any Environmental Law with respect to the Company Properties or the
businesses operated by any Consolidated Party (the "Businesses") and that, in
----------
each case, would reasonably be expected to have a Material Adverse Effect, and
there are no conditions or circumstances relating to the Businesses or Company
Properties or any former facilities, properties or businesses of any
Consolidated Party that could give rise to liability of any Consolidated Party
under any applicable Environmental Laws or under any agreement or other
instrument pursuant to which any Consolidated Party has agreed or is required to
indemnify any Person against any such liability.
(b) To the knowledge of the Credit Parties, none of the Company
Properties contains, or has previously contained, any Hazardous Materials at, on
or under the Company Properties in amounts or concentrations that constitute or
constituted a violation of, or could give rise to liability of any Consolidated
Party under, Environmental Laws or under any agreement or other instrument
pursuant to which any Consolidated Party has agreed or is required to indemnify
any Person against such liability.
(c) No Consolidated Party has received any written or verbal notice
of, or inquiry from any Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard to any
of the Company Properties or the Businesses, nor does any Consolidated Party
have knowledge or reason to believe as of the Effective Date that any such
notice will be received or is being threatened.
(d) To the knowledge of the Credit Parties, Hazardous Materials have
not been transported or disposed of from the Company Properties, or generated,
treated, stored or disposed of at, on or under any of the Company Properties or
any other location, in each case by or on behalf of any Consolidated Party in
violation of, or in a manner that could give rise to liability of any
Consolidated Party under, any applicable Environmental Law or under any
agreement or other instrument pursuant to which any Consolidated Party has
agreed or is required to indemnify any Person against such liability, and that,
in each case, would reasonably be expected to have a Material Adverse Effect.
(e) To the knowledge of the Credit Parties, no judicial proceeding or
governmental or administrative action is pending or, to the knowledge of any
Credit Party, threatened, under any Environmental Law to which any Consolidated
Party is or will be named as a party, nor are there any consent decrees, consent
orders, administrative orders, other decrees or orders or other administrative
or judicial requirements outstanding under any Environmental Law with respect to
any Consolidated Party, the Company Properties or the Businesses.
(f) To the knowledge of the Credit Parties, there has been no release
or threat of release of Hazardous Substances at or from the Company Properties,
or arising from or related to the operations (including disposal) of any
Consolidated Party in connection with the Company Properties or otherwise in
connection with the Businesses, in violation of or in amounts or in a manner
that could reasonably be expected to give rise to liability under Environmental
Laws or under any agreement or other instrument pursuant to which any
Consolidated Party has agreed or is required to indemnify any Person against
such liability), and that, in each case, would reasonably be expected to have a
Material Adverse Effect.
Section 5.17 Intellectual Property. Except as disclosed in Schedule
--------------------- --------
5.17:
----
85
(a) Each Consolidated Party owns, or has the legal right to use, all
trademarks, tradenames, copyrights, service marks, proprietary techniques,
patents, patent applications, trade secrets, technology, know-how and processes
(the "Intellectual Property") necessary for each of them to conduct its business
---------------------
as currently conducted except for those the failure to own or have such legal
right to use would not reasonably be expected to have a Material Adverse Effect.
All material Intellectual Property owned by any Consolidated Party is referred
to herein as the "Material Owned Intellectual Property" and all material
------------------------------------
Intellectual Property that any Consolidated Party has the right to use, but not
ownership of is referred to herein as "Material Licensed Intellectual Property."
---------------------------------------
The Material Owned Intellectual Property and the Material Licensed Intellectual
Property is referred to collectively as the "Material Intellectual Property."
------------------------------
Schedule 5.17 sets forth a complete and accurate list as of the Effective Date
-------------
of the Material Owned Intellectual Property and the Material Licensed
Intellectual Property. Except as set forth on Schedule 5.17, hereto, none of the
-------------
Consolidated Parties has granted any option, licenses or agreements of any kind
relating to Material Intellectual Property.
(b) Except as set forth on Schedule 5.17 hereto, to the knowledge of
-------------
the Credit Parties, no claim has been asserted and is pending by any Person
challenging or questioning the use, ownership or enforceability of any Material
Intellectual Property or the validity or effectiveness of any Material
Intellectual Property, and to the Credit Parties' knowledge the use of the
Material Intellectual Property by any Credit Party does not infringe on the
rights of any Person. None of the Consolidated Parties is in breach of any
material provision of any license, sublicense or other agreement which relates
to any of the Material Licensed Intellectual Property, and none of the
Consolidated Parties has taken any action which would impair or otherwise
adversely affect its rights in any of the Material Intellectual Property. All
the Material Owned Intellectual Property is valid and enforceable, except that,
with respect to the applications to register any unregistered Intellectual
Property (but not with respect to the underlying Intellectual Property rights
that are the subject of such applications), the Credit Parties only represent
and warrant that such applications are pending and in good standing all without
challenge of any kind.
(c) The Material Owned Intellectual Property has been maintained in
confidence in accordance with protection procedures customarily used to protect
rights of like importance. To the knowledge of the Credit Parties, no former or
current Personnel have any claim against the Consolidated Parties in connection
with such Person's involvement in the conception and development of any
Intellectual Property and no such claim has been asserted or is threatened. None
of the current officers and employees of any of the Consolidated Parties have
any patents issued or applications pending for any device, process, design or
invention of any kind now used or needed by any of the Consolidated Parties in
the furtherance of its business operations, which patents or applications have
not been assigned to the Consolidated Parties, with such assignment duly
recorded in the United States Patent Office.
Section 5.18 Solvency. Each Credit Party is and, immediately after
--------
consummation of the transactions contemplated by this Agreement (including the
Recapitalization), will be Solvent.
Section 5.19 Investments. All Investments of any Consolidated Party
-----------
are Permitted Investments.
Section 5.20 Location of Collateral. Schedule 5.20(a) sets forth a
---------------------- ----------------
complete and accurate list as of the Effective Date of (i) each Real Property
owned in fee by the Consolidated Parties and (ii) each real property leased by
the Consolidated Parties for which annual rental payments exceed $10,000, in
each case with street address, county, state and country where located. Set
forth on Schedule 5.20(b) is a complete and accurate list as of the Effective
----------------
Date of all Mortgaged Properties with street address, county, state and country
where located. Set forth on the Perfection Certificates is a complete and
accurate list as of the Effective Date of all locations where any tangible
property of a Credit
86
Party is located, including county and state where located. Set forth on the
Perfection Certificates is the chief executive office and principal place of
business of each Credit Party as of the Effective Date.
Section 5.21 Disclosure. As of the Effective Date, neither this
----------
Agreement nor any financial statements delivered to the Lenders pursuant thereto
nor any other document, certificate or statement furnished to the Lenders by or
on behalf of any Consolidated Party in connection with the transactions
contemplated hereby (other than financial projections) contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained therein or herein not misleading. All
financial projections that have been made available to the Administrative Agent
or the Lenders by any Consolidated Party or any representatives thereof in
connection with the transactions contemplated hereby have been prepared in good
faith based upon assumptions believed by the Consolidated Party to be
reasonable.
Section 5.22 No Burdensome Restrictions; Material Agreements.
(a) Except as set forth on Schedule 5.22, no Consolidated Party is a
-------------
party to any agreement or instrument or subject to any other obligation or any
charter or corporate restriction or any provision of any applicable law, rule or
regulation which, individually or in the aggregate, would reasonably be expected
to have a Material Adverse Effect. Schedule 5.22 sets forth a complete and
-------------
accurate list as of the Effective Date of each agreement, contract, lease,
license, commitment or other instrument to which any Consolidated Party is a
party or by which it or any of its properties are or may be bound after giving
effect to the transactions contemplated by the Transaction Documents, the loss
of which could, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect (collectively, the "Material Contracts").
------------------
(b) Except as set forth in Schedule 5.22, as of the Effective Date,
-------------
after giving effect to the transactions contemplated by the Transaction
Documents, each Material Contract will be in all material respects valid,
binding and in full force and effect with respect to, and will be enforceable
by, the Parent or any Subsidiary of the Parent which is a party thereto in
accordance with its terms, except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or similar laws affecting
creditors' rights generally and by equitable principles of general applicability
(whether in equity or at law or in admiralty). Except as set forth in Schedule
--------
5.22, as of the Effective Date, after giving effect to the transactions
----
contemplated by the Transaction Documents, each of the Parent and its
Subsidiaries will have performed in all material respects all obligations
required to be performed by it to date under the Material Contracts and it will
not be (with or without the lapse of time or the giving of notice, or both) in
breach or default in any material respect thereunder and, to the knowledge of
the Credit Parties, no other party to any of the Material Contracts will be
(with or without the lapse of time or the giving of notice, or both) in breach
or default in any material respect thereunder. As of the Effective Date, after
giving effect to the Recapitalization, neither the Parent nor any of its
Subsidiaries, nor, to the knowledge of the Credit Parties or the Parent, any
other party to any Material Contract, will have given notice of termination of,
or knowingly taken any action inconsistent with the continuation of, any
Material Contract. As of the Effective Date, after giving effect to the
transactions contemplated by the Recapitalization, to the knowledge of the
Credit Parties, none of such other parties will have any right exercisable as of
the Effective Date to terminate any Material Contract for any reason, including
as a result of the execution, delivery or performance of the Transaction
Documents, the collateral assignment of such Material Contract to the Collateral
Agent on behalf of the Lenders or the consummation of the Recapitalization,
except as set forth on Schedule 5.22.
-------------
(c) Except as set forth on Schedule 5.22, as of the Effective Date,
-------------
none of the Parent, or the Borrower has any knowledge of any actual or
threatened adverse change in the relationship between the Parent or any of its
Subsidiaries and any material customer, supplier distributor or other party
87
with whom the Parent or any of its Subsidiaries does business, whether as a
result of the transactions contemplated by the Transaction Documents or
otherwise.
Section 5.23 Brokers' Fees. Except as set forth on Schedule 5.23, no
------------- -------------
Consolidated Party has any obligation to any Person in respect of any finder's,
broker's, investment banking or other similar fee in connection with any of the
transactions contemplated by the Transaction Documents.
Section 5.24 Labor Matters. Except as disclosed in Schedule 5.24,
------------- -------------
there are no collective bargaining agreements or Multiemployer Plans covering
the employees of the Consolidated Parties as of the Effective Date and none of
the Consolidated Parties has suffered any strike, walkout, work stoppage, unfair
labor practice complaint or other material labor difficulty within the two years
prior to the Effective Date. To the knowledge of the Credit Parties and except
as disclosed in Schedule 5.24, no union representation question exists with
-------------
respect to the employees of any Consolidated Party and no union organizing
activities are taking place. The hours worked by and payments made to employees
of the Consolidated Parties have not been (i) in violation in any material
respect of the Fair Labor Standards Act or (ii) in violation of any other
applicable Federal, state, local or foreign law dealing with such matters except
where such violation could not reasonably be expected to have a Material Adverse
Effect. All payments due from any Consolidated Party, or for which any claim may
be made against any Consolidated Party, on account of wages, employee health and
welfare insurance or other benefits, have been paid or accrued as a liability on
the books of the Consolidated Parties except where the failure to pay or accrue
as a liability would not reasonably be expected to have a Material Adverse
Effect. The consummation of the transactions contemplated by the Transaction
Documents will not give rise to any right of termination or right or
renegotiation on the part of any union under any collective bargaining agreement
to which any Consolidated Party is bound.
Section 5.25 Vessels; Fishing Rights.
-----------------------
(a) Vessels. The Vessels are identified on Schedule 5.25. Each Vessel
------- -------------
is solely owned by the Borrower or a Subsidiary, as indicated on such Schedule.
Each Vessel: (i) is duly documented as a U.S. flag vessel with a fishery
endorsement in the name of the Borrower or a Subsidiary; (ii) is duly qualified
for a fishery endorsement under Chapter 121 of Title 46 of the United States
Code and the regulations thereunder; and (iii) is a catcher/processor vessel
named in Section 208(e)(1), (2), (3), (4), (5), (6) or (7) of the Americans
Fisheries Act, Title II of Division C, Pub.L. 105-277 (October 21, 1998) or any
successor thereto (the "AFA"), except the Vessel American Challenger, official
---
number 633219, which, to the knowledge of the Credit Parties, is the vessel
named in Section 208(b)(1) of the AFA and that the listing of the Vessel therein
with an incorrect official number is an error that does not alter the
application of such Section to the American Challenger, official number 633219.
Except as otherwise disclosed to the Administrative Agent in writing, the
Borrower or one or more of its Wholly-Owned Domestic Subsidiaries holds good
and marketable title to the Vessels and the Appurtenances thereto, free and
clear of all Liens other than Permitted Liens, and since October 21, 1998 and
prior to the Effective Date, each of the Vessels has been continuously
documented with a valid fishery endorsement, except for routine surrender and
prompt reissuance of certificates of documentation with a fishery endorsement as
disclosed on Schedule 5.25. On and after the Effective Date, there has occurred
-------------
no lapse of documentation or other event which could adversely affect any
Vessel's qualifications or eligibility to operate in the fisheries of the United
States at or after Effective Date. There are no contractual restrictions on the
operation of any of the Vessels or any of the Appurtenances thereto, other than
through bareboat charters and fishery cooperative agreements that are identified
in Schedule 5.25 or restrictions that would not reasonably be expected to have a
-------------
Material Adverse Effect.
(b) Fishing Rights. The Borrower or a Subsidiary, as indicated in
--------------
Schedule 5.25, holds all right, title and interest in Fishing Rights relating to
-------------
each Vessel and the Appurtenances thereto,
88
and all Approvals and Permits evidencing or representing such Fishing Rights for
which Approvals or Permits are issued by any Governmental Authority as
identified in Schedule 5.25, free and clear of all Liens other than Permitted
-------------
Liens. Each of the Consolidated Parties which is a party to a fishing
cooperative that relates to or impacts Fishing Rights Agreements is qualified to
remain a member of the cooperative. None of the Consolidated Parties has
committed any violation, or act or omission, which could give rise to an action
by such cooperative to revoke, suspend, amend, limit or terminate any of their
rights in such cooperative agreements.
Section 5.26 Condition and Use of the Vessels and Fishing Rights.
(a) Condition and Use of the Vessels.
(i) Except for the American Challenger, each of the Vessels is
classified with Det norske Veritas as set forth on Schedule 5.26. As of the
-------------
date hereof, there are no material outstanding exceptions noted in any
class survey or certification, and no recommendations that have been made
in any class survey or other survey of the Vessels that have not been fully
and properly corrected or completed. The Borrower or one or more of its
Subsidiaries has been issued and possesses for the Vessels, all tonnage
certificates, loadline certificates and certificates of compliance issued
by lawfully approved classification societies that are necessary for the
continued operation of the Vessels, in each case, as they are now operated,
and each of such certificates is valid and in full force and effect. None
of the Vessels has touched ground or been in a collision or allision
causing material damage to the Vessel since its last classification survey
and drydocking except for instances of touching ground which have been
disclosed in writing to the Administrative Agent which would not be
reasonably likely to have a Material Adverse Effect.
(ii) Except as set forth in Schedule 5.26(a) or (b) or as
---------------- ---
otherwise disclosed in writing to the Administrative Agent, none of the
Vessels or any of the Appurtenances to any of the Vessels has been used for
any illegal purpose, except for such failures to be in compliance with
applicable laws which individually or in the aggregate have not had and
will not have a Material Adverse Effect. Except as set forth on Schedule
--------
5.26(a) or 5.26(b) none of the Consolidated Parties is the subject of any
------- -------
material civil or administrative enforcement proceedings by the National
Marine Fisheries Service, the United States Coast Guard or any other
Governmental Authority. Except as set forth on Schedule 5.26(a) or 5.26(b)
---------------- -------
none of the Consolidated Parties has received a warning letter with respect
to any potential or unresolved violation, is aware of any potential
violation or pending investigation of any potential material violation, of
any state, federal or international law or protocol relating to the use or
operation of the Vessels or any of the Appurtenances to any of the Vessels.
Except as set forth in Schedule 5.26(a) or (b) or as otherwise disclosed in
---------------- ---
writing to the Administrative Agent, none of the Consolidated Parties has
committed any violation of law giving rise to any Lien against any of the
Vessels which could permit forfeiture of any of the Vessels or any of the
Appurtenances to any of the Vessels or an in rem action against any of the
-- ---
Vessels or any of the Appurtenances to any of the Vessels by any
Governmental Authority. To the Consolidated Parties' knowledge, there has
been no violation of law relating to possession or use of drugs or drug
paraphernalia aboard any of the Vessels, except for such failures to be in
compliance with applicable laws which individually or in the aggregate have
not had and will not have a Material Adverse Effect and its Consolidated
Subsidiaries, considered as a whole, and the Consolidated Parties have
taken the appropriate actions and instituted policies to prevent any such
possession or use.
(b) Condition and Use the Fishing Rights. Except as disclosed on
------------------------------------
Schedule 5.26(b): Each of the Consolidated Parties which holds an Approval or
----------------
Permit identified on Schedule 5.25 is
-------------
89
qualified under applicable law to hold such Approval or Permit and the Fishing
Rights evidenced or represented thereby and has been qualified to hold such
Approval or Permit (including prior annual renewals thereof) at all relevant
times. Except as otherwise disclosed to the Administrative Agent in writing,
none of the Consolidated Parties has committed any violation of law, or other
act or omission which could give rise to an action by any Governmental Authority
to revoke, suspend, amend, limit, terminate, or deny original issuance or
renewal of any of their respective Fishing Rights or any Approval or Permit
evidencing or representing such Fishing Rights. Except as set forth on Schedule
--------
5.26(b) or as otherwise disclosed to the Administrative Agent in writing, each
------
of the Consolidated Parties has conducted its activities and operations in
compliance in all material respects with the statutes and regulations giving
rise to the Fishing Rights and related Approvals and Permits and with the terms
and conditions of the such Approvals and Permits except as disclosed to
Administrative Agent in writing prior to the Effective Date. The Fishing Rights
and related Approvals and Permits are subject to the terms of the laws and
regulations under which they arise or are issued and can be granted, withheld or
substantially modified by the issuing authority at any time pursuant to
applicable law. Except as set forth on Schedule 5.26, none of the Credit Parties
-------------
is a Foreign Person, and none of the Credit Parties is owned, directly or
indirectly, by a Foreign Person to the extent that the Foreign Ownership
Percentage would exceed the Safe Harbor Percentage.
Section 5.27 Nature of Business. As of the Effective Date, the
------------------
Consolidated Parties are engaged in the conduct of the Businesses.
Section 5.28 Representations and Warranties from Other Agreements.
----------------------------------------------------
Except as set forth on Schedule 5.28, as of the Effective Date, each of the
-------------
representations and warranties made in the Transaction Documents by the parties
thereto is true and correct in all material respects.
Section 5.29 Security Documents.
------------------
(a) The Security Agreement (when duly executed on behalf of the
relevant Credit Party) is effective to create in favor of the Collateral Agent,
for the ratable benefit of the Secured Parties, legal, valid and enforceable
security interest in the Collateral (as defined in the Security Agreement) and
the financing statements previously filed in the offices specified on Schedule
--------
4.01 to the Security Agreement and the Pledged Securities are effective to
----
render the Security Agreement a fully perfected Lien on, and security interest
in, all right, title and interest of the grantors thereunder in such of the
Collateral in which a security interest can be perfected under Article 8 or 9 of
the Uniform Commercial Code, in each case prior and superior in right to any
Lien or any other Person, other than with respect to Permitted Liens.
(b) When the Assignment of Patents and Trademarks, substantially in
the form of Exhibit A to the Security Agreement, is duly executed on behalf of
the relevant Credit Party and filed in the United States Patent and Trademark
Office and the Assignment of Copyrights, substantially in the form of Exhibit B
to the Security Agreement, is filed in the United States Copyright Office, the
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors thereunder in the
Intellectual Property covered in such Assignments to the extent a security
interest can be perfected by such filings, in each case prior and superior in
right to any Lien or any other Person (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United
States Copyright Office may be necessary to perfect a Lien on registered
trademarks, trademark applications and copyrights acquired by the grantors after
the Effective Date).
(c) The Vessel Mortgages are effective to create a legal, valid and
enforceable Lien on all of the right, title and interest of the Credit Parties
in and to the Vessels and their Appurtenances, and each such Vessel Mortgage
constitutes a fully perfected Lien on and security interest in, all right, title
90
and interest of the Credit Parties in the Vessels and Appurtenances, in each
case prior and superior in right to any Lien or any other Person, other than
with respect to Permitted Liens.
(d) The fully executed and notarized Mortgages are effective to create
in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, a legal, valid and enforceable Lien on all of the right, title and
interest of the Credit Parties' in and to the Mortgaged Properties thereunder
and the proceeds thereof, and such Mortgages constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the Credit
Parties in the Mortgaged Properties and the proceeds thereof, in each case prior
and superior in right to any Lien or any other Person, other than with respect
to Permitted Liens.
(e) When each Depositary Bank Agreement has been duly executed on
behalf of the relevant Credit Party and delivered to the Collateral Agent, the
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of such Credit Parties in the deposit
accounts subject thereto to the extent a security interest in deposit accounts
can be perfected under Article 8 or 9 of the Uniform Commercial Code, in each
case prior and superior in right to any Lien or any other Person, other than
with respect to Permitted Liens.
(f) The Collateral Agent, for the ratable benefit of the Secured
Parties, will at all times have the Liens provided for in the Collateral
Documents and, subject to the filing by the Collateral Agent of continuation
statements to the extent required by the Uniform Commercial Code, the Collateral
Documents will at all times constitute valid and continuing lien of record and
first priority perfected security interest in all the Collateral referred to
therein, except as priority may be affected by Permitted Liens. As of the
Effective Date, no filings or recordings are required in order to perfect the
security interests created under the Collateral Documents, except for filings or
recordings listed on Schedule 5.29(e).
----------------
Section 5.30 Transactions with Affiliates. Except as set forth in
----------------------------
Schedule 5.30 and except for agreements and arrangements among the Borrower and
-------------
its Wholly-Owned Subsidiaries, among Wholly-Owned Subsidiaries of the Borrower
or as permitted pursuant to Section 7.09, neither the Borrower nor any of its
------------
Subsidiaries will be, immediately after giving effect to the transactions
contemplated by the Transaction Documents on the Effective Date, a party to or
engaged in any transaction with, and none of the properties and assets of the
Parent or any of its Subsidiaries will be, immediately after giving effect to
the transactions contemplated by the Transaction Documents on the Effective
Date, subject to or bound by any agreement or arrangement with, (a) any
Affiliate of any Consolidated Party or (b) the Sponsor or any of its Affiliates.
Section 5.31 Ownership. (a) On the Effective Date, Holdings owns 100%
---------
of the limited liability company interests in the Parent, and the Parent,
directly or indirectly through ASC, owns 100% of the limited liability company
interests in the Borrower (the "Borrower LLC Interests"). The Borrower LLC
----------------------
Interests have been duly and validly authorized and issued, are fully paid and
nonassessable, and were not issued in violation of the preemptive rights of any
member. The Parent and ASC, respectively, own good, valid and marketable title
to all the outstanding Borrower LLC Interests, free and clear of all Liens of
every kind, whether absolute, matured, contingent or otherwise, other than those
arising under the Collateral Documents or Permitted Liens. The Borrower has no
outstanding Equity Equivalents, no incentive units, phantom stock or similar
arrangements and no calls, commitments or claims of any character relating to
its Capital Stock. Except as set forth on Schedule 5.31, there are no
-------------
shareholder agreements or other agreements pertaining to the Borrower LLC
Interests, including any agreement that would restrict the Parent's or ASC's
right to dispose of the Borrower LLC Interests and/or its right to vote the
Borrower LLC Interests.
91
(b) Schedule 5.31 sets forth a true and accurate list as of the
-------------
Effective Date of each holder of Capital Stock of the Parent, Holdings and the
Borrower, indicating the name of each such holder and the Capital Stock held by
each such Person.
Section 5.32 Insurance. Except as set forth on Schedule 5.32, the
--------- -------------
Consolidated Parties maintain policies of fire and casualty, liability, business
interruption and other forms of insurance in such amounts, with such deductibles
and against such risks and losses as are in accordance with normal industry
practice for their business and assets. All such policies are in full force and
effect, all premiums due and payable thereon have been paid (other than
retroactive or retrospective premium adjustments that are not yet, but may be,
required to be paid with respect to any prior period under comprehensive general
liability and workmen's compensation insurance policies), and no notice of
cancellation or termination has been received with respect to any such policy
which has not been replaced on substantially similar terms prior to the date of
such cancellation. The activities and operations of the Consolidated Parties
have been conducted in a manner so as to conform in all material respects to all
applicable provisions of such insurance policies. Schedule 5.32 sets forth the
-------------
insurance coverage of the Consolidated Parties and each of their respective
Subsidiaries by carrier, policy number, expiration date and type as of the
Effective Date.
Section 5.33 Certain Transactions. On the Effective Date, no
--------------------
Recapitalization Document or Senior Subordinated Note Document shall have been
amended or modified, or any condition thereof waived by any Consolidated Party,
without the prior written consent of the Administrative Agent, (ii) all
conditions to the obligations of each Consolidated Party to consummate the
transactions contemplated by the Transaction Documents shall have been satisfied
or waived with consent of the Administrative Agent, (iii) all funds advanced on
the Effective Date by the Lenders will be used in accordance with Section 5.15
------------
and (iv) the transactions contemplated by the Transaction Documents will be
consummated in accordance with the Transaction Documents and all applicable
Requirements of Law.
ARTICLE VI
AFFIRMATIVE COVENANTS
Each of the Parent and the Borrower, and, where applicable, Holdings,
agrees that so long as any Lender has any Commitment hereunder, any Obligation
or other amount payable hereunder or under any Note or other Credit Document or
any LOC Obligation remains unpaid or any Letter of Credit remains in effect:
Section 6.01 Information. The Borrower will furnish, or cause to be
-----------
furnished, to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in any
---------------------------
event within 90 days after the end of each fiscal year of the Borrower, a
consolidated balance sheet and income statement of the Borrower and its
Consolidated Subsidiaries, as of the end of such fiscal year, and the related
consolidated statements of operations and retained earnings and of cash flows
for such fiscal year, setting forth in comparative form consolidated figures for
the preceding fiscal year, all such financial statements to be in reasonable
form and detail and audited by independent certified public accounts of
recognized national standing reasonably acceptable to the Administrative Agent
and accompanied by an opinion of such accountants (which shall not contain any
going concern qualification or qualification based on the scope of the audit) to
the effect that such financial statements have been prepared in accordance with
GAAP and present fairly in all material respects the consolidated financial
position and consolidated results of operations and cash flows of the Borrower
and its Consolidated Subsidiaries in accordance with GAAP consistently applied
(except for changes with which such accountants concur).
92
(b) Quarterly Financial Statements. As soon as available, and in any
------------------------------
event within 45 days after the end of each of the first three fiscal quarters in
each fiscal year of the Borrower, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such fiscal quarter, together
with related consolidated statements of operations and retained earnings and of
cash flows for such fiscal quarter and the then elapsed portion of such fiscal
year, setting forth in comparative form consolidated figures for the
corresponding periods of the preceding fiscal year, all such financial
statements to be in form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of a Responsible Officer
of the Borrower to the effect that such quarterly financial statements have been
prepared in accordance with GAAP and present fairly in all material respects the
consolidated financial position and consolidated results of operations and cash
flows of the Borrower and its Consolidated Subsidiaries in accordance with GAAP
consistently applied, subject to changes resulting from normal year-end audit
adjustments.
(c) Officer's Certificate. At the time of delivery of the financial
---------------------
statements provided for in Sections 6.01(a) and 6.01(b) above, a certificate of
---------------- -------
a Responsible Officer of the Borrower (i) demonstrating compliance with the
financial covenants contained in Section 7.18 by calculation thereof as of the
------------
end of the fiscal period covered by such financial statements, (ii) stating that
no Default or Event of Default exists, or if any Default or Event of Default
does exist, specifying the nature and extent thereof and what action the
Borrower proposes to take with respect thereto and (iii) stating whether, since
the date of the most recent financial statements delivered hereunder, there has
been any material change in the generally accepted accounting principles applied
in the preparation of the financial statements of the Borrower and its
Consolidated Subsidiaries, and, if so, describing such change. At the time such
certificate is required to be delivered, the Borrower shall promptly deliver to
the Administrative Agent, at the address set forth in Section 10.01 and at the
-------------
Agency Services Address, information regarding (i) any change in the Leverage
Ratio that would change the then existing Applicable Percentage and (ii) setting
forth for the period covered by such certificate (A) the amount of non-cash
gains or losses recognized in determining Consolidated Net Income for such
period in respect of foreign exchange activities and (B) an itemization of other
non-cash charges or non-cash losses included in, and all non-cash income or
non-cash gains deducted from, the computation of Consolidated EBITDA for such
period.
(d) Annual Business Plan and Budgets. At least 30 days after the
--------------------------------
commencement of each fiscal year of the Borrower, beginning with the fiscal year
ending December 31, 2003, an annual business plan and budget of the Borrower and
its Consolidated Subsidiaries containing, among other things, projected
financial statements for the next fiscal year.
(e) Compliance With Certain Provisions of this Agreement. Within 90
----------------------------------------------------
days after the end of each fiscal year of the Borrower, a certificate containing
information regarding (i) the calculation of Excess Cash Flow for such fiscal
year and (ii) the amount of Net Cash Proceeds from Asset Dispositions (other
than Excluded Asset Dispositions), Debt Issuances (other than Excluded Debt
Issuances) and Equity Issuances (other than Excluded Equity Issuances) that were
made during such fiscal year.
(f) Accountant's Certificate; Annual Certificates. Within the period
---------------------------------------------
for the delivery of the annual financial statements provided for in Section
-------
6.01(a), (i) a certificate of the accountants conducting the annual audit
------- ---
stating that they have reviewed this Agreement and stating further whether, in
the course of their audit, they have become aware of any Default or Event of
Default and, if any such Default or Event of Default exists, specifying the
nature and extent thereof as it relates to accounting matters and (ii) a
certificate from a Responsible Officer of the Borrower certifying that no Credit
Party has changed its jurisdiction of organization since the last such
certification.
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(g) Auditor's Reports. Promptly upon receipt thereof, a copy of any
-----------------
other report or "management letter" submitted by independent accountants to the
Borrower or any of its Subsidiaries in connection with any annual, interim or
special audit of the books of the Borrower or any of its Subsidiaries.
(h) Reports. Promptly upon transmission or receipt thereof, (i) copies
-------
of all filings and registrations with, and reports to or from, the Securities
and Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports the Consolidated Parties shall
send to their respective shareholders or to a holder of any Debt owed by any
Consolidated Party its capacity as such a holder and (ii) upon the request of
the Administrative Agent or the Required Lenders, all reports and written
information with respect to (1) compliance costs that would reasonably be
expected to have a Material Adverse Affect, (2) noncompliance with Environmental
Laws, (3) reporting of spills or releases, or (4) contamination to and from the
United States Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational Health and
Safety Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters.
(i) Notices. Upon obtaining knowledge thereof, the Borrower will give
-------
immediate written notice to the Administrative Agent of (i) the occurrence of
any Default or Event of Default, specifying the nature and existence thereof and
what action the Borrower proposes to take with respect thereto, and (ii) the
occurrence of any of the following with respect to any Consolidated Party: (A)
the pendency or commencement of any litigation, arbitral or governmental
proceeding against such Person which if adversely determined would reasonably be
expected to have a Material Adverse Effect; or (B) the institution of any
proceedings against such Person with respect to, or the receipt of notice by
such Person of potential liability or responsibility (direct or indirect) for
violation, or alleged violation of any federal, state or local law, rule or
regulation, including Environmental Laws, the violation of which would
reasonably be expected to have a Material Adverse Effect.
(j) ERISA. The Borrower will give written notice to the Administrative
-----
Agent promptly (and in any event within five Business Days after any officer of
any Consolidated Party obtains knowledge thereof) of: (i) any event or
condition, including any Reportable Event, that constitutes, or is reasonably
likely to lead to, an ERISA Event; (ii) with respect to any Multiemployer Plan,
the receipt of notice as prescribed in ERISA or otherwise of any withdrawal
liability assessed against the Parent or any of its ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or insolvent
(both within the meaning of Title IV of ERISA); (iii) the failure to make full
payment on or before the due date (including extensions) thereof of any material
amount which any Consolidated Party or any ERISA Affiliate is required to
contribute to each Plan pursuant to its terms and as required to meet the
minimum funding standard set forth in ERISA and the Code with respect thereto;
or (iv) any change in the funding status of any Plan that would reasonably be
expected to have a Material Adverse Effect, together with a description of any
such event or condition or a copy of any such notice and a statement by a
Responsible Officer of the Borrower briefly setting forth the details regarding
such event, condition or notice and the action, if any, which has been or is
being taken or is proposed to be taken by the Borrower with respect thereto.
Promptly upon request, the Borrower shall furnish the Administrative Agent and
the Lenders with such additional information concerning any Plan as may be
reasonably requested, including copies of each annual report/return (Form 5500
series), as well as all schedules and attachments thereto required to be filed
with the Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the meaning of
Section 3(39) of ERISA).
(k) Environmental.
-------------
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(i) In the event Administrative Agent reasonably believes that
there has been a material violation of Environmental Laws or that a release
or threatened release of Hazardous Substances has occurred at any Company
Property or by a Consolidated Party at any other location, Administrative
Agent may request (in writing) that, the Borrower furnish or cause to be
furnished to the Administrative Agent, at the expense of the Borrower, a
report of an environmental assessment of reasonable scope, form and depth
(including, where reasonably necessary, invasive soil or groundwater
sampling) by a consultant reasonably acceptable to the Administrative Agent
as to the nature and extent of the presence of any Hazardous Substances on
any Company Properties and as to the compliance by any Consolidated Party
with Environmental Laws at the Company Properties. If any Consolidated
Party fails to deliver, or cause to be delivered, such an environmental
report within 60 days after receipt of such written request, then the
Administrative Agent may arrange for the same, and each of the Parent and
the Borrower grants, and agrees to cause the other Consolidated Parties to
grant to the Administrative Agent and its representatives reasonable access
to the Company Properties to reasonably undertake such an assessment
(including, where appropriate, invasive soil or groundwater sampling). Any
such assessment shall be conducted, unless otherwise agreed to by
Administrative Agent and the Borrower, during normal business hours, and
shall be conducted so as not to interfere with the ongoing operations at
such Company Property or to cause any damage or loss to any property at
such Company Property. The Borrower and Administrative Agent acknowledge
and agree that any assessment conducted at the request of Administrative
Agent pursuant to this subsection 6.01(k)(ii) will be obtained and shall be
----------------------
used by the Administrative Agent for the purposes of Administrative Agent's
internal credit decisions and to protect the Administrative Agent's
security interests, if any, created by the Collateral Documents. No such
environmental assessment shall be given or the contents thereof
communicated to any Governmental Authority or any other Person without the
prior written consent of the Borrower unless the delivery of such
environmental assessment or report or disclosure of the contents thereof is
required by the Requirements of Law. The reasonable cost of any assessment
arranged by the Administrative Agent pursuant to this provision shall be
payable by the Borrower on demand and shall be added to the obligations
secured by the Collateral Documents.
(ii) The Borrower will, or will cause the Consolidated Parties
to, conduct and complete all investigations, studies, sampling, and testing
and all remedial, removal and other actions necessary to address all
Hazardous Substances on, from or affecting any of the Company Properties to
the extent necessary to be in compliance with all Environmental Laws and
with the orders and directives of all Governmental Authorities with
jurisdiction over the Company Properties to the extent any failure to take
the foregoing actions would reasonably be expected to have a Material
Adverse Effect. Each of the Parent and the Borrower acknowledges and agree
that if any of them or their respective Subsidiaries fails to perform any
of the actions required under this Section 6.01(k)(ii), the Administrative
-------------------
Agent shall have the right (but not the obligation) to do so for such
Person. Each of the Parent and the Borrower further acknowledges and agrees
that if any Consolidated Party fails to cooperate (e.g., by allowing access
to any premises or permitting the drilling of core samples, etc.) the
Administrative Agent and the Lenders will not have an adequate remedy at
law.
(l) Additional Patents, Trademarks and Copyrights. At the time of
---------------------------------------------
delivery of the financial statements and reports provided for in Section
-------
6.01(a), a report signed by a Responsible Officer of the Borrower setting forth
-------
(i) a list of registration numbers for all patents, trademarks, service marks,
tradenames and copyrights awarded to any Consolidated Party since the last day
of the immediately preceding fiscal year of the Borrower and (ii) a list of all
patent applications, trademark applications, service ▇▇▇▇ applications, trade
name applications and copyright applications submitted by any
95
Consolidated Party since the last day of the immediately preceding fiscal year
and the status of each such application, all in such form as shall be reasonably
satisfactory to the Administrative Agent.
(m) Catch and Production Reports. As soon as available, and in any
----------------------------
event within 45 days after the end of each fiscal quarter of the Borrower, a
report in form and substance reasonably acceptable to the Administrative Agent,
as to the catch and production with respect to each of the Vessels.
(n) Other Information. With reasonable promptness upon request
-----------------
therefor, such other information regarding the business, properties or financial
condition of any Consolidated Party as the Administrative Agent or the Required
Lenders may reasonably request.
Section 6.02 Preservation of Existence and Franchises. Except as a
----------------------------------------
result of or in connection with a dissolution, merger or disposition of a
Subsidiary of the Borrower permitted under Section 7.04 or Section 7.05, each of
------------ ------------
the Consolidated Parties will do all things necessary to preserve and keep in
full force and effect its existence, material rights, material franchises and
authority.
Section 6.03 Books and Records. Each of the Consolidated Parties will
-----------------
keep complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the establishment
and maintenance of appropriate reserves).
Section 6.04 Compliance with Law. Each of the Consolidated Parties
-------------------
will comply with all Requirements of Law, including the AFA, applicable to it
and its properties to the extent that noncompliance with any such Requirement of
Law would reasonably be expected to have a Material Adverse Effect.
Section 6.05 Payment of Taxes and Other Indebtedness. Each of the
---------------------------------------
Consolidated Parties will pay and discharge (i) all taxes, assessments and other
governmental charges or levies imposed upon it, or upon its income or profits,
or upon any of its properties, before they shall become delinquent, (ii) all
lawful claims (including claims for labor, materials and supplies) which, if
unpaid, might give rise to a Lien upon any of its properties, and (iii) except
as prohibited hereunder, all of its other Debt as it shall become due; provided,
--------
however, that no Consolidated Party shall be required to pay any such tax,
-------
assessment, charge, levy, claim or Debt which is being contested in good faith
by appropriate proceedings diligently pursued and as to which adequate reserves
have been established in accordance with GAAP, unless the failure to make any
such payment (i) could give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) would reasonably be expected to have a Material
Adverse Effect.
Section 6.06 Insurance; Certain Proceeds. (a) Except as set forth on
----------------------------------------
Schedule 5.32, each of the Consolidated Parties will at all times maintain in
-------------
full force and effect insurance (including worker's compensation insurance,
liability insurance, casualty insurance and business interruption insurance) in
such amounts, covering such risk and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice (or
as are otherwise required by the Collateral Documents). The Collateral Agent
shall be named as loss payee or mortgagee, as its interest may appear, with
respect to all such property and casualty policies and additional insured with
respect to all such other policies (other than workers' compensation and
employee health policies and marine insurance policies), and each provider of
any such insurance shall agree, by endorsement upon the policy or policies
issued by it or by independent instruments furnished to the Collateral Agent,
that if the insurance carrier shall have received written notice from the
Collateral Agent of the occurrence of an Event of Default, the insurance carrier
shall pay all proceeds otherwise payable to the Consolidated Parties under such
policies directly to the Collateral Agent (which agreement shall be evidenced by
a "standard" or "New York" lender's loss payable endorsement in the name of the
Collateral Agent on Accord Form 27 or other customary form) and that it will
give the Collateral Agent twenty days' prior
96
written notice before any such policy or policies shall be altered or canceled,
and, other than with respect to the marine policies, that no act or default of
any Consolidated Party or any other Person shall affect the rights of the
Collateral Agent, or the Lenders under such policy or policies.
(b) In case of any Casualty or Condemnation with respect to any
property of any Consolidated Party or any part thereof, the Borrower shall
promptly give written notice thereof to the Administrative Agent generally
describing the nature and extent of such damage, destruction or taking. In such
case, the Borrower shall, or shall cause such Consolidated Party to, promptly
repair, restore or replace the property of such Person (or part thereof) which
was subject to such Casualty or Condemnation, at such Person's cost and expense,
whether or not the Insurance Proceeds or Condemnation Award, if any, received on
account of such event shall be sufficient for that purpose; provided, however,
-------- -------
that such property need not be repaired, restored or replaced to the extent the
failure to make such repair, restoration or replacement (i)(A) is desirable to
the proper conduct of the business of such Person in the ordinary course and
otherwise in the best interest of such Person and (B) would not materially
impair the rights and benefits of the Collateral Agent or the Secured Parties
under the Collateral Documents or any other Credit Document or (ii) the failure
to repair, restore or replace the property is attributable to the application of
the Insurance Proceeds from such Casualty or the Condemnation Award from such
Condemnation to payment of the Obligations in accordance with the following
provisions of Section 6.06(b). If any Consolidated Party shall receive any
---------------
Insurance Proceeds from a Casualty or Condemnation Award from a Condemnation,
such Person will immediately pay over such proceeds to the Administrative Agent,
for payment of the Obligations in accordance with Section 3.03(b) or, if such
---------------
funds constitute Reinvestment Funds, to be held by the Collateral Agent in the
Reinvestment Funds Account established under the Security Agreement. The
Administrative Agent agrees to cause the Collateral Agent to release such
Insurance Proceeds or Condemnation Awards to the Borrower upon its request and
as needed from time to time to pay for the repair, restoration or replacement of
the portion of the property subject to such Casualty or Condemnation if, but
only if, the conditions set forth in the definition of "Reinvestment Funds" are
satisfied at the time of such request.
(c) In connection with the covenants set forth in this Section 6.06,
------------
it is understood and agreed that:
(i) none of the Agents, the Lenders or their respective agents or
employees shall be liable for any loss or damage insured by the insurance
policies required to be maintained under this Section 6.06, it being
------------
understood that (A) the Consolidated Parties shall look solely to their
insurance companies or any other parties other than the aforesaid parties
for the recovery of such loss or damage and (B) such insurance companies
shall have no rights of subrogation against the Agents, the Lenders or
their agents or employees. If, however, the insurance policies do not
provide waiver of subrogation rights against such parties, as required
above, then each of the Parent and the Borrower hereby agrees to, and to
cause each of the Consolidated Parties to, waive its right of recovery, if
any, against the Agents, the Lenders and their agents and employees, to the
extent permitted by law and to the extent that the relevant policies of
insurance shall not be prejudiced thereby;
(ii) the Consolidated Parties will permit an insurance consultant
retained by the Administrative Agent, at the expense of the Borrower, to
review from time to time the insurance policies maintained by the
Consolidated Parties annually or upon the occurrence of an Event of
Default; and
(iii) the Required Lenders shall have the right from time to time
to require the Consolidated Parties to keep other insurance in such form
and amount as the Administrative Agent or the Required Lenders may
reasonably request; provided that such insurance shall be
--------
97
obtainable on commercially reasonable terms; and provided further that the
-------- -------
designation of any form, type or amount of insurance coverage by the
Administrative Agent or the Required Lenders under this Section 6.06 shall
------------
in no event be deemed a representation, warranty or advice by any Agent or
the Lenders that such insurance is adequate for the purposes of the
business of the Consolidated Parties or the protection of their respective
properties.
Section 6.07 Maintenance of Property. Each of the Consolidated Parties
-----------------------
will maintain and preserve its properties and equipment material to the conduct
of its business in good repair, working order and condition, normal wear and
tear and Casualty and Condemnation excepted, and will make, or cause to be made,
as to such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions, betterments and improvements thereto as may
be needed or proper, to the extent and in the manner customary for companies in
similar businesses.
Section 6.08 Performance of Obligations. Except as permitted by
--------------------------
Section 6.05 or as prohibited by this Agreement or any other Credit Document,
------------
each of the Consolidated Parties will perform in all respects all of its
obligations under the terms of all agreements, indentures, mortgages, security
agreements or other debt instruments to which it is a party or by which it is
bound, except to the extent such nonperformance would not reasonably be expected
to have a Material Adverse Effect.
Section 6.09 Use of Proceeds. The Borrower will use the proceeds of
---------------
the Loans and the Letters of Credit solely for the purposes set forth in Section
-------
5.15.
----
Section 6.10 Audits/Inspections. Upon reasonable notice and during
------------------
normal business hours, but not more than once during each fiscal year of the
Borrower unless an Event of Default has occurred and is continuing, each of the
Consolidated Parties will permit representatives appointed by the Agents or the
Required Lenders, including independent accountants, agents, employees,
attorneys and appraisers, to visit and inspect its financial records and
properties, and to make photocopies or photographs thereof and to write down and
record any information such representatives obtain and shall permit the Agents
or such representatives to investigate and verify the accuracy of information
provided to the Lenders and to discuss all such matters with the officers and
independent accountants of the Consolidated Parties; provided, that so long as
--------
no Default or Event of Default has occurred and is continuing, representatives
of the Borrower may, if they choose, be present at or participate in any such
discussions. Each Credit Party will, not more than once during any fiscal year
of the Borrower, unless an Event of Default has occurred and is continuing,
upon the reasonable request of the Collateral Agent, permit the Collateral Agent
or professionals (including investment bankers, consultants, accountants,
lawyers and appraisers) retained by the Collateral Agent to conduct evaluations
and appraisals of the assets included in the Collateral, and the Borrower will
pay the reasonable fees and expenses of such professionals in accordance with
Section 10.05. Upon the occurrence and during the continuance of an Event of
-------------
Default, each of the Parent and the Borrower hereby irrevocably authorizes and
directs all accountants and auditors employed by it at any time during the term
of this Agreement to exhibit and deliver to the Administrative Agent and the
Lenders copies of any of the financial statements, trial balances or other
accounting records of any sort of the Consolidated Parties in the accountant's
or auditor's possession, and to disclose to the Administrative Agent and the
Lenders any information they may have concerning the financial status and
business operation of the Consolidated Parties. Upon the occurrence and during
the continuance of an Event of Default, each of the Parent and the Borrower
hereby irrevocably authorizes all federal, state and municipal authorities to
furnish to the Lenders copies of reports or examinations relating to the
Consolidated Parties, whether made by the Consolidated Parties or otherwise.
Section 6.11 Additional Credit Parties; Additional Security.
98
(a) Additional Subsidiary Guarantors. Each of the Parent and the
--------------------------------
Borrower will take, and will cause each of its Subsidiaries (other than Foreign
Subsidiaries, except to the extent provided in subsection (d) below,
--------------
non-Wholly-Owned Subsidiaries and Joint Venture Entities) to take, such actions
from time to time as shall be necessary to ensure that all Subsidiaries of the
Borrower (other than Foreign Subsidiaries, except to the extent provided in
subsection (d) below, non-Wholly-Owned Subsidiaries and Joint Venture Entities)
--------------
are Subsidiary Guarantors. Without limiting the generality of the foregoing, in
the event that any Consolidated Party shall form or acquire any new Subsidiary,
the Borrower, as soon as practicable and in any event within 30 days after such
formation or acquisition, will provide the Collateral Agent with notice of such
formation or acquisition setting forth in reasonable detail a description of all
of the assets of such new Subsidiary and will cause such new Subsidiary (other
than a Foreign Subsidiary, except to the extent provided in subsection (d)
--------------
below, non-Wholly-Owned Subsidiaries and Joint Venture Entities) to:
(i) within 30 days after such formation or acquisition, execute a
Joinder Agreement pursuant to which such new Subsidiary shall agree to
become a "Guarantor" under the Subsidiary Guaranty Agreement, an "Obligor"
under the Security Agreement and a "Pledgor" under the Pledge Agreement;
(ii) if such Person owns or leases any real property located in
the United States or, to the extent deemed to be material by the Collateral
Agent or the Required Lenders in its or their sole discretion, located
outside the United States, to execute and deliver to the Collateral Agent
such mortgages, deeds of trust or other agreements or instruments covering
such real property and fixtures (other than immaterial leased properties)
as shall be necessary to create and perfect valid and enforceable Liens
(subject only to Permitted Liens) on such real property and fixtures as
collateral security for the Obligations, together in each case with such
Uniform Commercial Code financing statements, environmental reports and
landlord's waivers as the Collateral Agent or the Required Lenders may
reasonably request;
(iii) to the extent not otherwise covered pursuant to clause (ii)
-----------
above, take such actions (including, without limitation, delivering such
securities, other investment property or instruments and executing and
delivering such Uniform Commercial Code financing statements) as shall be
necessary to create and perfect valid and enforceable first priority Liens
(subject only to Permitted Liens) on all or substantially all of the assets
of such new Subsidiary as collateral security for the Obligations; and
(iv) deliver such proof of organizational authority, incumbency
of officers, opinions of counsel and other documents as is consistent with
those delivered by each Credit Party pursuant to Section 4.01 on the
------------
Effective Date or as the Administrative Agent, the Collateral Agent or the
Required Lenders shall have requested.
(b) Additional Security. Each of the Parent and the Borrower will
-------------------
cause, and will cause each of its Subsidiaries (other than a Foreign Subsidiary,
except to the extent provided in subsection (d) below, non-Wholly-Owned
--------------
Subsidiaries and Joint Venture Entities) to cause, (i) all of its owned Real
Properties with a fair market value greater than $1,000,000 and personal
property located in the United States, (ii) to the extent deemed to be material
by the Administrative Agent or the Required Lenders in its or their sole
reasonable discretion, all of its other owned Real Properties with a fair market
value greater than $1,000,000 and personal property, (iii) all of its Material
Leased Properties located in the United States and (iv) all other material
assets of the Parent and its Subsidiaries as are not covered by the original
Collateral Documents and as may be requested by the Collateral Agent or the
Required Lenders in their sole reasonable discretion to be subject at all times
to first priority (subject only to Permitted Liens), perfected and, in the case
of real property (whether leased or owned), title insured Liens
99
in favor of the Collateral Agent pursuant to the Collateral Documents or such
other security agreements, pledge agreements, mortgages or similar collateral
documents as the Collateral Agent shall request in its sole, reasonable
discretion (collectively, the "Additional Collateral Documents"). With respect
-------------------------------
to any owned Real Property with a fair market value greater than $1,000,000 or
Material Leased Property located in the United States acquired or leased by any
Credit Party subsequent to the Effective Date, such Person will cause to be
delivered to the Collateral Agent with respect to such property, documents,
instruments, including, without limitation, Mortgages, title insurance policies,
surveys, flood hazard certifications and legal opinions, all in form, content
and scope reasonably satisfactory to the Collateral Agent. In furtherance of the
foregoing terms of this Section 6.11, the Borrower agrees to promptly provide
------------
the Administrative Agent with written notice of the acquisition by any
Consolidated Party of any owned Real Property located in the United States
having a fair market value greater than $1,000,000 or the entering into a lease
by any Consolidated Party of any Material Leased Property located in the United
States, setting forth in each case in reasonable detail the location and a
description of the asset(s) so acquired or leased. Without limiting the
generality of the foregoing, the Parent and the Borrower will cause, and will
cause each of their respective Subsidiaries to cause, 100% of the Capital Stock
(or such lesser percentage as may be owned by the Borrower and any other Credit
Party) of each of their respective direct and indirect Subsidiaries (or 65% of
such Capital Stock, if such Subsidiary is a direct Foreign Subsidiary, except as
provided in subsection (d) below) to be subject at all times to a first
--------------
priority, perfected Lien in favor of the Collateral Agent pursuant to the terms
and conditions of the Collateral Documents.
If, subsequent to the Effective Date, a Credit Party shall acquire any
Intellectual Property, securities, instruments, chattel paper or other personal
property required to be delivered to the Collateral Agent as Collateral
hereunder or under any of the Collateral Documents, the Borrower shall promptly
(and in any event within five Business Days after any officer of any Credit
Party acquires knowledge of the same) notify the Collateral Agent of the same.
Each of the Credit Parties shall adhere to the covenants regarding the location
of personal property as set forth in the Security Agreement.
All such security interests and mortgages shall be granted pursuant to
documentation reasonably satisfactory in form and substance to the Collateral
Agent and shall constitute valid and enforceable perfected security interests
and mortgages superior to and prior to the rights of all third Persons and
subject to no other Liens except for Permitted Liens. The Additional Collateral
Documents or instruments related thereto shall have been duly recorded or filed
in such manner and in such places as are required by law to establish, perfect,
preserve and protect the Liens in favor of the Collateral Agent required to be
granted pursuant to the Additional Collateral Documents, and all taxes, fees and
other charges payable in connection therewith shall have been paid in full. The
Parent shall cause to be delivered to the Collateral Agent such opinions of
counsel, title insurance and other related documents as may be reasonably
requested by the Collateral Agent to assure itself that this Section 6.11(b) has
---------------
been complied with.
(c) Real Property Appraisals. If the Collateral Agent or the Required
------------------------
Lenders reasonably determine that they are required by law or regulation to have
appraisals prepared in respect of the Real Property of any Consolidated Party
constituting Collateral, the Borrower shall provide to the Collateral Agent
appraisals which satisfy the applicable requirements set forth in 12 C.F.R.,
Part 34 - Subpart C or any successor or similar statute, rule, regulation,
guideline or order, and which shall be in scope, form and substance, and from
appraisers, reasonably satisfactory to the Required Lenders and shall be
accompanied by a certification of the appraisal firm providing such appraisals
that the appraisals comply with such requirements.
(d) Foreign Subsidiaries Security. If the Collateral Agent or the
-----------------------------
Required Lenders provide written notice to the Borrower that there has been a
change in the relevant sections of the Code or
100
the regulations, rules, rulings, notices or other official pronouncements issued
or promulgated thereunder, the Borrower shall seek an opinion from counsel
(which shall be chosen by the Borrower and reasonably satisfactory to the
Collateral Agent), with respect to any Foreign Subsidiary of the Borrower which
has not already had all of its stock pledged pursuant to the Pledge Agreement,
that (i) a pledge (A) of 65.0% or more of the total combined voting power of all
classes of capital stock of such Foreign Subsidiary entitled to vote, or (B) of
any promissory note issued by such Foreign Subsidiary to the Borrower or any of
its Domestic Subsidiaries, (ii) the entering into by such Foreign Subsidiary of
a guaranty in form and substance substantially identical to the Subsidiary
Guaranty Agreement, (iii) the entering into by such Foreign Subsidiary of a
security agreement in form and substance substantially identical to the Security
Agreement, or (iv) the entering into by such Foreign Subsidiary of a pledge
agreement substantially identical to the Pledge Agreement, in any such case
would not cause the undistributed earnings of such Foreign Subsidiary as
determined for United States federal income tax purposes to be treated as a
deemed dividend to such Foreign Subsidiary's United States parent for United
States federal income tax purposes. If the Borrower receives an opinion of
counsel (A) to the effect described in clause (i) above, that portion of such
----------
Foreign Subsidiary's outstanding capital stock or any promissory notes so issued
by such Foreign Subsidiary, in each case not theretofore pledged pursuant to the
Pledge Agreement, shall be pledged to the Collateral Agent for the benefit of
the Creditors pursuant to the Pledge Agreement (or another pledge agreement in
substantially identical form, if needed); (B) to the effect described in clause
------
(ii) above, such Foreign Subsidiary shall execute and deliver the Subsidiary
----
Guaranty Agreement (or another guaranty in substantially identical form, if
needed), guaranteeing the Obligations; (C) to the effect described in clause
------
(iii) above, such Foreign Subsidiary shall execute and deliver the Security
-----
Agreement (or another security agreement in substantially identical form, if
needed), granting to the Collateral Agent, for the benefit of the Creditors, a
security interest in all of such Foreign Subsidiary's assets and securing the
Obligations; or (D) to the effect described in clause (iv) above, such Foreign
-----------
Subsidiary shall execute and deliver the Pledge Agreement (or another pledge
agreement in substantially identical form, if needed), pledging to the
Collateral Agent, for the benefit of the Creditors, all of the capital stock and
promissory notes owned by such Foreign Subsidiary, in each case to the extent
that entering into such Subsidiary Guaranty Agreement, Security Agreement or
Pledge Agreement is permitted by the laws of the respective foreign jurisdiction
and with all documents delivered pursuant to this Section 6.11(d) to be in form,
---------------
scope and substance reasonably satisfactory to the Collateral Agent.
(e) Each of the Parent and the Borrower agrees that each action
required by this Section 6.11 shall be completed as soon as possible, but in no
------------
event later than 60 days after such action is either requested to be taken by
the Collateral Agent or the Required Lenders or required to be taken by any
Consolidated Party pursuant to the terms of this Section 6.11.
------------
Section 6.12 Interest Rate Protection Agreements. Prior to the date
-----------------------------------
which is 120 days after the Effective Date, the Borrower will have entered into
and thereafter maintain in full force and effect Derivatives Agreements designed
to hedge the position of the Borrower with respect to interest rates at rates
and on terms satisfactory to the Administrative Agent, the effect of which shall
be to fix or limit the interest rate that would be payable in connection with
not less than 50% of the aggregate principal amount of the Term Loans and the
Senior Subordinated Notes for a period expiring no earlier than the third
anniversary of the Effective Date. The Borrower will promptly deliver evidence
of the execution and delivery of such agreements to the Administrative Agent.
Section 6.13 Contributions. Upon its receipt thereof, the Parent will
-------------
contribute as a common equity contribution to the capital of the Borrower any
cash proceeds received by the Parent after the Effective Date from any Asset
Disposition, Debt Issuance or Equity Issuance or any cash capital contributions
received by the Parent after the Effective Date.
Section 6.14 Compliance with the AFA.
-----------------------
101
(a) Each of the Consolidated Parties and their Affiliates (i) shall
fully and timely comply with the terms and conditions of the Vessel Mortgages
and with any and all charter agreements relating to the operation of any of the
Vessels; (ii) shall take all action necessary to maintain the fisheries
endorsement for each of the Vessels and to ensure that each of the Vessels
remains eligible under the AFA in a manner necessary to preserve the Fishing
Rights; and (iii) shall take any and all action necessary to maintain its
membership in all fishery cooperatives in which any Consolidated Party is a
party on the Effective Date or thereafter becomes a party and to preserve its
fishing cooperative allocations and the Fishing Rights Agreements.
(b) The Consolidated Parties agree that none of the Consolidated
Parties or any of their respective Affiliates now has or shall acquire an
interest in any vessel, fish processing facility or Person or take any other
action if the acquisition of such interest or such other action would result in
any limitation or restriction on the quantity of any fish or shellfish which may
be harvested or processed by any of the Consolidated Parties, individually or
collectively, under applicable limitations on "excessive shares" specified in or
pursuant to the AFA or otherwise or on any other basis.
(c) The Credit Parties agree that they shall not take any action which
shall constitute an impermissible transfer to a Foreign Person, create an
ownership interest which exceeds the Foreign Ownership Percentage or transfer
impermissible control to a Foreign Person. The Credit Parties, upon reasonable
request of Administrative Agent, shall under the AFA provide evidence acceptable
to the Department of Transportation, Maritime Administration, of their
citizenship and the percentage of their ownership interests which is directly or
indirectly controlled by a Foreign Person.
Section 6.15 Foreign Currency Rate Protection Agreements. The Borrower
-------------------------------------------
will, and will cause its Consolidated Subsidiaries to, keep each Derivatives
Agreement to manage Japanese Yen exchange rates in effect on the Effective Date
in full force and effect for the respective terms thereof and enter into and
maintain in full force and effect Derivatives Agreements to manage risk
associated with changes in foreign currency exchange rates, including, without
limitation such agreements relating to the Japanese Yen, consistent with past
business practice of the Consolidated Parties.
Section 6.16 Post Closing Matters. Within 90 days of the Effective
--------------------
Date, the Collateral Agent shall have received (in form and substance
satisfactory to the Collateral Agent) a copy of a survey for each Vessel
performed in 2002, and other documentation relating thereto.
ARTICLE VII
NEGATIVE COVENANTS
Each of the Parent and the Borrower, and, where applicable, Holdings,
agrees that so long as any Lender has any Commitment hereunder, any Obligations
or other amount payable hereunder or under any Note or other Credit Document or
any LOC Obligation remains unpaid or any Letter of Credit remains unexpired:
Section 7.01 Limitation on Debt. None of the Consolidated Parties
------------------
will, or will permit any of their respective Subsidiaries to, incur, create,
assume or permit to exist any Debt or Derivatives Obligations except:
(i) Debt of the Borrower and its Subsidiaries outstanding on the
Effective Date and disclosed on Schedule 7.01, without giving effect to any
-------------
subsequent extension, renewal or refinancing thereof (collectively, the
"Existing Debt");
-------------
102
(ii) Debt of the Credit Parties under this Agreement and the
other Credit Documents;
(iii) purchase money Debt (including Capital Leases) or Synthetic
Leases of the Borrower and its Subsidiaries incurred after the Effective
Date to finance the purchase of capital assets acquired after the Effective
Date; provided that (A) the aggregate amount of all such Debt (together
--------
with refinancings thereof permitted by clause (v) below) does not exceed
----------
$22,500,000 at any time outstanding, (B) the Debt when incurred shall not
be more than 100% of the lesser of the cost or fair market value as of the
time of acquisition of the asset financed, (C) such Debt is issued and any
Liens securing such Debt are created concurrently with, or within 90 days
after, the acquisition of the asset financed and (D) no Lien securing such
Debt shall extend to or cover any property or asset of any Consolidated
Party other than the asset so financed;
(iv) Debt of the Borrower or its Subsidiaries secured by Liens
permitted by Sections 7.02(x), (xi) and (xii) in an aggregate outstanding
---------------- ---- -----
principal amount (together with refinancings thereof permitted by clause
------
(v) below) not exceeding $5,000,000; provided that (A) such Debt was not
--- --------
incurred in connection with, or in anticipation of, the events described in
such Sections and (B) such Debt does not constitute debt for borrowed money
(it being understood that Capital Leases, Synthetic Leases and purchase
money Debt shall not constitute debt for borrowed money solely for purposes
of this clause (iv));
------------
(v) Debt of the Borrower or its Subsidiaries representing a
refinancing, replacement or refunding of Debt permitted by clause (i),
----------
(iii), or (iv) above; provided that the aggregate principal amount of such
----- -- ---- --------
Debt outstanding or available and the interest rate per annum payable by
the Borrower and its Subsidiaries with respect to such Debt will not be
increased, and the weighted average remaining life to maturity of such Debt
will not be decreased by reason of such refinancing, replacement or
refunding;
(vi) Derivatives Obligations of the Borrower or any Subsidiary
under Derivatives Agreements to the extent entered into before or after the
Effective Date in compliance with Section 6.12 or to manage interest rate,
------------
foreign currency exchange rates or fuel prices and not for speculative
purposes;
(vii) Debt consisting of Guarantees (A) by the Borrower of Debt
and leases permitted to be incurred by Wholly-Owned Domestic Subsidiaries
of the Borrower (B) by Domestic Subsidiaries of the Borrower of Debt and
leases permitted to be incurred by the Borrower or Wholly-Owned Domestic
Subsidiaries of the Borrower and (C) by Foreign Subsidiaries of Debt and
leases permitted to be incurred by Wholly-Owned Foreign Subsidiaries of the
Borrower;
(viii) Debt owing to the Borrower or a Subsidiary of the Borrower
to the extent permitted by Section 7.06(a)(x), (xi) or (xii);
------------------ ---- -----
(ix) Debt of the Borrower, the Co-Issuer and the Subsidiary
Guarantors in respect of the Senior Subordinated Notes (but not including
any renewal, refinancing or extension thereof);
(x) Debt incurred by any Subsidiary which is not a Wholly-Owned
Subsidiary in an aggregate principal amount for all such Subsidiaries not
exceeding $15,000,000 at any time outstanding;
103
(xi) Debt of the Borrower or any of its Subsidiaries in respect
of performance, appeal and surety bonds, completion guarantees, insurance
bonds and other similar bonds provided by the Borrower or such Subsidiary
in the ordinary course of business;
(xii) Debt by the Borrower or any of its Subsidiaries arising
from agreements of the Borrower or such Subsidiary providing for, and in
respect of, indemnification, adjustment of purchase price or similar
obligations, in each case, incurred or assumed in connection with the
disposition of any business, assets or Capital Stock of a Subsidiary
permitted under this Agreement or any other Loan Document, but excluding
Guaranty Obligations in respect of indebtedness incurred by any Person
acquiring all or any portion of such business, assets or a Subsidiary for
the purpose of financing such acquisition; provided that: (A) such Debt is
-------- ----
not reflected on the balance sheet of the Borrower or any of its
Subsidiaries (contingent obligations referred to in a footnote or footnotes
to financial statements and not otherwise reflected on the balance sheet
will not be deemed to be reflected on that balance sheet for purpose of
this clause (A); and (B) the maximum assumable liability in respect of that
Debt shall at no time exceed the gross proceeds including noncash proceeds
(the fair market value of those noncash proceeds being measured at the time
received and without giving effect to any subsequent changes in value)
actually received by the Borrower and/or that Subsidiary in connection with
that disposition; and
(xiii) Debt of the Borrower and its Subsidiaries not otherwise
permitted by this Section incurred after the Effective Date in an aggregate
principal amount not to exceed $20,000,000 at any time outstanding;
provided that (A) the credit documentation with respect to such Debt shall
--------
not contain covenants or default provisions relating to the Borrower or any
of its Subsidiaries that are more restrictive than the covenants and
default provisions contained in the Credit Documents, (B) no Default or
Event of Default shall have occurred and be continuing immediately before
and immediately after giving effect to such incurrence and (C) the Borrower
shall have delivered to the Administrative Agent a certificate
demonstrating that, upon giving effect on a Pro-Forma Basis to the
incurrence of such Debt and to the concurrent retirement of any other Debt
of any Consolidated Party, the Credit Parties shall be in compliance with
the financial covenants set forth in Section 7.18.
------------
Section 7.02 Restriction on Liens. None of the Consolidated Parties
--------------------
will, or will permit any of their respective Subsidiaries to, create, incur,
assume or permit to exist any Lien upon or with respect to any property or
assets of any kind (real or personal, tangible or intangible) of any
Consolidated Party whether now owned or hereafter acquired, or sell any such
property or assets subject to an understanding or agreement, contingent or
otherwise, to repurchase such property or assets (including sales of accounts
receivable or notes with recourse to any Consolidated Party) or assign any right
to receive income, or file or permit the filing of any financing statement under
the Uniform Commercial Code as in effect in any applicable jurisdiction or any
other similar notice of Lien under any similar recording or notice statute;
provided that the provisions of this Section 7.02 shall not prevent the
-------- ------------
creation, incurrence, assumption or existence of the following (with such Liens
described below being herein referred to as "Permitted Liens"):
---------------
(i) Liens existing on the Effective Date and listed on Schedule
--------
7.02 hereto, in each case without giving effect to any extensions or
----
renewals thereof;
(ii) Liens created by the Collateral Documents;
(iii) Liens (other than any Liens imposed by ERISA or pursuant to
any Environmental Law) for taxes, assessments or governmental charges or
levies not yet due or
104
being contested in good faith and by appropriate proceedings diligently
pursued for which adequate reserves (in the good faith judgment of the
management of the Borrower) have been established in accordance with GAAP
(and as to which the property or assets subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof);
(iv) Liens imposed by law securing the charges, claims, demands
or levies of landlords, carriers, warehousemen, mechanics, carriers,
materialmen and other like Persons which were incurred in the ordinary
course of business and which (A) do not, individually or in the aggregate,
materially detract from the value of the property or assets which are the
subject of such Lien or materially impair the use thereof in the operation
of the business of the Borrower or any of its Subsidiaries or (B) which are
being contested in good faith by appropriate proceedings diligently
pursued, which proceedings have the effect of preventing the forfeiture or
sale of the property or assets subject to such Lien;
(v) Liens arising from judgments, decrees or attachments (or
securing of appeal bonds with respect thereto) in circumstances not
constituting an Event of Default under Section 8.01;
------------
(vi) Liens (other than any Liens imposed by ERISA or pursuant to
any Environmental Law), not securing Debt or Derivatives Obligations, which
are incurred or deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
types of social security or to secure the performance of tenders, statutory
obligations, surety bonds (other than appeal bonds), bids, leases,
government contracts, performance and return-of-money bonds, warranty
requirements and other similar obligations incurred in the ordinary course
of business;
(vii) zoning restrictions, easements, rights of way, licenses,
reservations, covenants, conditions, waivers, restrictions on the use of
property or other minor encumbrances or irregularities of title which do
not, individually or in the aggregate, materially impair the use of any
property in the operation or business of any Consolidated Party or the
value of such property for the purpose of such business;
(viii) Permitted Encumbrances and Vessel Permitted Liens on any
property; provided that such Vessel Permitted Liens (A) do not,
--------
individually or in the aggregate, materially detract from the value of the
property or assets which are the subject of such Lien or materially impair
the use thereof in the operation of the business of the Borrower or any of
its Subsidiaries, (B) are contested in good faith by appropriate
proceedings diligently pursued, which proceedings shall have commenced
within 90 days of the Borrower or any Subsidiary obtaining knowledge of
such Vessel Permitted Lien arising and have the effect of preventing the
forfeiture or sale of the property or assets subject to such Lien or (C)
arise and are from time to time discharged in the ordinary course of
business consistent with past practice;
(ix) Liens securing Debt permitted to be incurred under Section
-------
7.01(iii);
---------
(x) any Lien existing on any asset of any Person at the time such
Person becomes a Subsidiary of the Borrower and not created in
contemplation of such event;
(xi) any Lien on any asset of any Person existing at the time
such Person is merged or consolidated with or into the Borrower or a
Subsidiary of the Borrower and not created in contemplation of such event;
105
(xii) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Subsidiary of the Borrower and not created in
contemplation of such acquisition;
(xiii) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt of the Borrower or any Subsidiary of the
Borrower secured by any Lien permitted by clause (i), (ix), (x), (xi) or
---------- ---- --- ----
(xii) of this Section; provided that such Debt is not increased and is not
----- --------
secured by any additional assets;
(xiv) Liens on cash and cash equivalents securing Derivatives
Obligations owing to one or more Persons who are not Derivatives Creditors;
provided that the aggregate amount of cash and cash equivalents subject to
--------
such Liens may at no time exceed $10,000,000;
(xv) Liens arising from precautionary Uniform Commercial Code
financing statements regarding, and any interest or title of a licensor,
lessor or sublessor under, Operating Leases permitted by this Agreement;
and
(xvi) licenses, leases or subleases (but excluding leases or
subleases of Vessels, Fishing Rights or Permits or Approvals evidencing or
representing Fishing Rights) granted to third Persons not interfering in
any material respect with the business of any Consolidated Party.
Section 7.03 Nature of Business. None of the Consolidated Parties
------------------
shall engage in any business other than business of the type engaged by the
Consolidated Parties on the Effective Date or any business reasonably related,
complementing or ancillary thereto or a reasonable expansion or extension
thereof.
Section 7.04 Consolidation, Merger and Dissolution. Except in
-------------------------------------
connection with an Asset Disposition permitted by the terms of Section 7.05,
------------
none of the Consolidated Parties will, or will permit any of their respective
Subsidiaries to, enter into any transaction of merger or consolidation or
liquidate, wind up or dissolve itself or its affairs (or suffer any liquidations
or dissolutions); provided that:
--------
(i) any Wholly-Owned Domestic Subsidiary of the Borrower may
merge with and into, or be voluntarily dissolved or liquidated into, the
Borrower, so long as (A) the Borrower is the surviving corporation of such
merger, dissolution or liquidation, (B) the security interests granted to
the Collateral Agent for the benefit of the Creditors pursuant to the
Collateral Documents in the assets of such Wholly-Owned Domestic Subsidiary
so merged, dissolved or liquidated shall remain in full force and effect
and perfected (to at least the same extent as in effect immediately prior
to such merger, dissolution or liquidation) and (C) no Default or Event of
Default shall have occurred and be continuing immediately before or
immediately after giving effect to such transaction;
(ii) any Wholly-Owned Domestic Subsidiary of the Borrower may
merge with and into, or be voluntarily dissolved or liquidated into, any
other Wholly-Owned Domestic Subsidiary of the Borrower, so long (A) as the
security interests granted to the Collateral Agent for the benefit of the
Creditors pursuant to the Collateral Documents in the assets of such
Wholly- Owned Domestic Subsidiary so merged, dissolved or liquidated shall
remain in full force and effect and perfected (to at least the same extent
as in effect immediately prior to such merger, dissolution or liquidation)
and (B) no Default or Event of Default shall have occurred and be
continuing immediately before or immediately after giving effect to such
transaction;
106
(iii) any Foreign Subsidiary of the Borrower may be merged with
and into, or be voluntarily dissolved or liquidated into, the Borrower or
any Wholly-Owned Subsidiary of the Borrower, so long as (A) the Borrower or
such Wholly-Owned Subsidiary, as the case may be, is the surviving
corporation of any such merger, dissolution or liquidation and (B) no
Default or Event of Default shall have occurred and be continuing
immediately before or immediately after giving effect to such transaction;
(iv) the Borrower or any Subsidiary of the Borrower may merge
with any Person (other than the Borrower or any of its Subsidiaries) in
connection with a Permitted Acquisition if (A) the Borrower or such
Subsidiary shall be the continuing or surviving corporation in such merger
or consolidation, (B) the Credit Parties shall cause to be executed and
delivered such documents, instruments and certificates as the
Administrative Agent may reasonably request so as to cause the Credit
Parties to be in compliance with the terms of Section 6.11 after giving
------------
effect to such transactions, (C) no Default or Event of Default shall have
occurred and be continuing immediately before or immediately after giving
effect to such transaction and (D) the Borrower shall have delivered to the
Administrative Agent a Pro-Forma Compliance Certificate demonstrating that,
upon giving effect on a Pro-Forma Basis to such transaction, the Credit
Parties will be in compliance with all of the financial covenants set forth
in Section 7.18 as of the last day of the most recent period of four
------------
consecutive fiscal quarters of the Borrower which precedes or ends on the
date of such transaction and with respect to which the Administrative Agent
has received the consolidated financial information required under Section
-------
6.01(a) or (b) and the officer's certificate required by Section 6.01(c).
------- --- ---------------
In the case of any merger or consolidation permitted by this Section 7.04 of any
------------
Subsidiary of the Borrower which is not a Credit Party into a Credit Party, the
Credit Parties shall cause to be executed and delivered such documents,
instruments and certificates as the Administrative Agent may reasonably request
so as to cause the Credit Parties to be in compliance with the terms of Section
-------
6.11 after giving effect to such transaction.
----
Section 7.05 Asset Dispositions. None of the Consolidated Parties
------------------
will, or will permit any of their respective Subsidiaries to, make any Asset
Disposition; provided that:
--------
(i) any Consolidated Party may make any Excluded Asset
Disposition;
(ii) any Consolidated Party may enter into any Sale/Leaseback
Transaction not prohibited by Section 7.13;
------------
(iii) any Domestic Subsidiary of the Borrower may sell, lease or
otherwise transfer all or substantially all of its assets to the Borrower,
so long as the security interests granted to the Collateral Agent for the
benefit of the Creditors pursuant to the Collateral Documents in such
assets shall remain in full force and effect and perfected (to at least the
same extent as in effect immediately prior to such sale, lease or other
transfer);
(iv) any Domestic Subsidiary of the Borrower may sell, lease or
otherwise transfer all or substantially all of its assets to any other
Wholly-Owned Domestic Subsidiary of the Borrower, so long as the security
interests granted to the Collateral Agent for the benefit of the Creditors
pursuant to the Collateral Documents in such assets shall remain in full
force and effect and perfected (to at least the same extent as in effect
immediately prior to such sale, lease or other transfer);
107
(v) any Foreign Subsidiary of the Borrower may sell, lease or
otherwise transfer all or substantially all of its assets to the Borrower
or any Wholly-Owned Subsidiary of the Borrower;
(vi) the Borrower and its Subsidiaries may make transfers of
assets constituting Investments in Joint Venture Entities made pursuant to
Section 7.06(a)(xv);
-------------------
(vii) the PLC Distribution shall be permitted;
(viii) the Borrower and its Subsidiaries may make transfers of
assets constituting Investments in non-Wholly-Owned Domestic Subsidiaries
made pursuant to Section 7.06(a)(xi);
-------------------
(ix) the Borrower and its Subsidiaries may make transfers of
assets constituting Investments in Foreign Subsidiaries made pursuant to
Section 7.06(a)(xii);
--------------------
(x) any Consolidated Party may make Asset Dispositions consisting
of Restricted Payments permitted by Section 7.07; and
------------
(xi) Permitted Vessel Leases shall be permitted.
Upon consummation of an Asset Disposition permitted under this Section 7.05, the
------------
Administrative Agent shall (or shall cause the Collateral Agent to) (to the
extent applicable) deliver to the Borrower, upon the Borrower's request and at
the Borrower's expense, such documentation as is reasonably necessary to
evidence the release of the Collateral Agent's security interests, if any, in
the assets being disposed of, including amendments or terminations of Uniform
Commercial Code Financing Statements, if any, the return of stock certificates,
if any, and the release of any Subsidiary being disposed of in its entirety from
all of its obligations, if any, under the Credit Documents.
Section 7.06 Investments.
-----------
(a) Investments. None of the Consolidated Parties will hold, make or
-----------
acquire, or will permit any of their respective Subsidiaries to, hold, make or
acquire, any Investment in any Person, except the following (with such
Investments described below being herein referred to as "Permitted
---------
Investments"):
-----------
(i) the Borrower or any of its Consolidated Subsidiaries may
purchase inventory, equipment and machinery in the ordinary course of
business;
(ii) Investments existing on the date hereof (A) which are listed
on Schedule 7.06 or (B) in Persons which are Subsidiaries on the date of
-------------
this Agreement;
(iii) the Borrower or any Domestic Subsidiary of the Borrower may
invest in cash and Cash Equivalents;
(iv) the Borrower and any Subsidiary of the Borrower may acquire
and hold receivables owing to them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms;
108
(v) the Borrower and each Subsidiary may acquire and own
Investments (including Debt obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement
of delinquent obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;
(vi) the Borrower or any of its Subsidiaries may (A) make loans
and advances to employees, officers and directors, in each case in the
ordinary course of business in an aggregate amount at any one time
outstanding not exceeding $1,000,000, and (B) acquire and hold obligations
of one or more officers, managing directors or other employees of the
Borrower or any of its Subsidiaries in connection with such Persons'
acquisition of Capital Stock of Holdings in an aggregate principal amount
not to exceed $7,000,000 at any one time outstanding, if and so long as
such obligations shall be evidenced by one or more promissory notes secured
in each case by a perfected, first priority security interest in the
Capital Stock so acquired, which promissory notes shall be pledged to the
Collateral Agent pursuant to the Pledge Agreement;
(vii) deposits made in the ordinary course of business consistent
with past practices to secure the performance of leases shall be permitted;
(viii) the Borrower or any of its Subsidiaries may make loans and
advances to the Parent and ASC and the Parent and ASC may make loans and
advances to Holdings for the purposes and in the amounts necessary to pay
the fees, expenses and taxes described in Section 7.07(iv);
----------------
(ix) the Parent may make equity contributions to the capital of
the Borrower;
(x) the Borrower may make Investments in any of its Wholly-Owned
Domestic Subsidiaries, Wholly-Owned Domestic Subsidiaries of the Borrower
may make Investments in other Wholly-Owned Domestic Subsidiaries of the
Borrower and any Subsidiary of the Borrower may make intercompany loans and
advances to the Borrower or any Wholly-Owned Domestic Subsidiary of the
Borrower; provided that (A) each item of intercompany Debt shall be
--------
evidenced by a promissory note in the form of Exhibit G hereto, (B) each
---------
promissory note evidencing intercompany loans and advances made by a
Foreign Subsidiary or a non-Wholly-Owned Domestic Subsidiary to the
Borrower or a Wholly-Owned Domestic Subsidiary of the Borrower shall
contain the subordination provisions set forth in Exhibit H hereto and (C)
---------
each promissory note evidencing intercompany loans and advances (other than
promissory notes held by Foreign Subsidiaries, except to the extent
provided in Section 6.11(d)) shall be pledged to the Collateral Agent
----------------
pursuant to the Pledge Agreement;
(xi) the Borrower and its Subsidiaries may make Investments in
any non-Wholly-Owned Domestic Subsidiary of the Borrower (A) in the case of
Investments by the Borrower or any Wholly-Owned Domestic Subsidiary of the
Borrower, in an aggregate amount (determined without regard to any
write-downs or write-offs of any such Investments constituting Debt) at any
one time outstanding not exceeding $15,000,000 in the case of
non-Wholly-Owned Domestic Subsidiaries, and (B) to the extent such
Investments arise from the sale of inventory in the ordinary course of
business by the Borrower or such Subsidiary to such non-Wholly-Owned
Domestic Subsidiary for resale by such non-Wholly-Owned Domestic Subsidiary
(including any such Investments resulting from the extension of the payment
terms with respect to such sales); provided that each item of intercompany
--------
Debt shall be evidenced by a promissory note in the form of Exhibit G
---------
hereto;
109
(xii) the Borrower and its Subsidiaries may make Investments in
any Foreign Subsidiary (A) in the case of Investments by the Borrower or
any Wholly-Owned Domestic Subsidiary of the Borrower, in an aggregate
amount (determined without regard to any write-downs or write-offs of any
such Investments constituting Debt) not exceeding $5,000,000 after the
Effective Date, and (B) to the extent such Investments arise from the sale
of inventory in the ordinary course of business by the Borrower or such
Subsidiary to such Foreign Subsidiary for resale by such Foreign Subsidiary
(including any such Investments resulting form the extension of the payment
terms with respect to such sales); provided that (A) each item of
--------
intercompany Debt shall be evidenced by a promissory note in the form of
Exhibit G hereto and (B) each promissory note evidencing intercompany loans
---------
and advances (other than promissory notes (x) issued by Foreign
Subsidiaries of the Borrower to the Borrower or any of its Domestic
Subsidiaries or (y) held by Foreign Subsidiaries of the Borrower), which in
each case only to the extent provided in Section 6.11(d), shall be pledged
---------------
to the Collateral Agent pursuant to the Pledge Agreement;
(xiii) the Borrower and its Subsidiaries may make transfers of
assets to their respective Subsidiaries in accordance with Section 7.05;
------------
(xiv) the Borrower and its Subsidiaries may make expenditures in
respect of Permitted Acquisitions;
(xv) the Borrower and its Subsidiaries may make Investments in
Affiliates (other than Subsidiaries) and in Persons in which the Investment
is accounted for by the equity method of accounting (such as joint
ventures, partnerships or similar agreements or arrangements involving the
sharing of profits or joint or coordinated purchasing or distribution (each
a "Joint Venture Entity" and, collectively "Joint Venture Entities")) if,
-------------------- ----------------------
and only to the extent that, (A) the consideration comprising such
Investment is contributed to a Joint Venture Entity exchange for Capital
Stock of the Joint Venture Entity to which such assets are contributed, (B)
the Borrower and its Subsidiaries shall comply with the provisions of
Section 6.11 to the extent applicable to Joint Ventures (without giving
------------
effect to any grace periods provided for therein), (C) in the case of
Investments made in the form of Cash or Cash Equivalents, the aggregate
amount of such Investments (determined (x) based on the original cost of
such Investments and without adjustment to the basis of such Investments to
recognize earnings or losses after the date of an Investment and (y) solely
for purposes of this clause (C) without including the value attributable to
----------
contributed services) does not exceed $10,000,000, and (D) in the case of
Investments made in the form of one or more contributions of assets (other
than assets constituting cash or Cash Equivalents), (x) the Borrower shall
have delivered to the Administrative Agent a certificate of a Responsible
Officer or the chief accounting officer of the Borrower containing
reasonably detailed calculations demonstrating that the Consolidated EBITDA
attributable to the such contributed assets shall not exceed 5% of the
aggregate Consolidated EBITDA of the Borrower and its Consolidated
Subsidiaries for the fiscal year most recently ended on or prior to the
date of such contribution and (y) at the time of such contribution, the
assets contributed to such Joint Venture Entity, together the fair market
value of all other contributions of assets made pursuant to this clause (D)
(measured as of the respective dates of such contributions), shall have a
fair market value not exceeding $25,000,000;
(xvi) ASC may retain Investment in the Borrower Preferred
Interests and in common Capital Stock of the Borrower made on the date of
the Original Credit Agreement;
(xvii) any Consolidated Party may invest in Derivatives
Obligations permitted pursuant to Section 7.01(vi);
----------------
110
(xviii) the Borrower and its Subsidiaries may make loans to
Coastal Village ▇▇▇▇▇▇▇ LLC and Central Bering Sea Fishermen's Association;
provided that such loans are approved in good faith by a majority of the
--------
disinterested members of the Board of Directors of the Borrower and the
aggregate principal amount of such loans at any one time outstanding does
not exceed $500,000; and
(xix) deposit accounts containing foreign currency received in
the ordinary course of business or held by the Borrower or any of its
Subsidiaries in the ordinary course of business shall be permitted;
provided that none of the Consolidated Parties may make or own any Investment in
--------
Margin Stock.
(b) Asset Acquisitions. None of the Consolidated Parties will, or will
------------------
permit any of their respective Subsidiaries to, make any acquisition of assets
outside the ordinary course of business; provided that the Borrower and its
--------
Subsidiaries may make Permitted Acquisitions.
(c) Joint Ventures and Similar Arrangements. Except as permitted
---------------------------------------
pursuant to Section 7.06(a)(xv), none of the Consolidated Parties will, or will
-------------------
permit any of their respective Subsidiaries to, enter into any joint venture or
partnership agreement or arrangement or any other agreement or arrangement with
any Person involving the sharing of profits or joint or coordinated purchasing
or distribution.
(d) Limitation on the Creation of Subsidiaries. None of the
------------------------------------------
Consolidated Parties will, or will permit any of their respective Subsidiaries
to, establish, create or acquire after the Effective Date any Subsidiary;
provided that the Borrower and its Wholly-Owned Subsidiaries shall be permitted
--------
to establish, create or acquire Subsidiaries so long as (i) at least 5 days'
prior written notice thereof is given to the Administrative Agent, (ii) the
capital stock or other equity interests of such new Subsidiary (other than a
Foreign Subsidiary, except to the extent otherwise required pursuant to Section
-------
6.11(d)) is pledged pursuant to, and to the extent required by, the Pledge
--------
Agreement and the certificates representing such interests, together with
transfer powers duly executed in blank, are delivered to the Collateral Agent,
(iii) such new Subsidiary (other than a Foreign Subsidiary, except to the extent
otherwise required pursuant to Section 6.11(d), or a non-Wholly-Owned
---------------
Subsidiary) executes a Joinder Agreement as provided in Section 6.11(b), (iv)
---------------
such new Subsidiary, to the extent requested by the Administrative Agent, takes
all actions required pursuant to Section 6.11 and (v) the Investment by the
------------
Borrower and its Wholly-Owned Subsidiaries in such new Subsidiary is otherwise
permitted under paragraph (a) above.
-------------
Section 7.07 Restricted Payments, etc. None of the Consolidated
------------------------
Parties will, or will permit any of their respective Subsidiaries to, declare or
pay any Restricted Payments, except that:
(i) a Consolidated Party may pay dividends payable solely in
Capital Stock, of such Person;
(ii) subject to clause (v) below, any Subsidiary of the Borrower
----------
may pay Restricted Payments to the Borrower or to any Wholly-Owned
Subsidiary of the Borrower;
(iii) so long as no Default or Event of Default is then in
existence or would otherwise arise therefrom, the Borrower may pay cash
dividends to the Parent and cash distributions in respect of the Borrower
Preferred Interests to ASC and the Parent and ASC may in turn pay cash
dividends to Holdings if Holdings promptly uses the proceeds to redeem or
repurchase Capital Stock (or options to purchase such Capital Stock) from
(A) officers, managing
111
directors, employees and directors of any Consolidated Party (or their
estates) upon the death, permanent disability, retirement or termination of
employment of any such Person or otherwise in accordance with (x) the
Securityholders' Agreement and (y) any stock option plan or any employee
stock ownership plan maintained by Holdings, or (B) other holders of
Capital Stock of Holdings, so long as the purpose of such purchase is to
acquire Capital Stock for reissuance to new officers, managing directors,
employees and directors (or their estates) of any Consolidated Party, to
the extent so reissued within 12 months of any such purchase; provided that
--------
in all such cases the aggregate amount of all cash dividends paid in
respect of all such shares so redeemed or repurchased does not exceed
$3,000,000 during any fiscal year of the Borrower;
(iv) the Borrower may distribute cash to the Parent and ASC (and
the Parent may distribute cash to Holdings), in an amount sufficient (A) to
allow ASC to pay, and allow Holdings to make distributions to the owners of
the Capital Stock of Holdings (the "Holdings Owners") sufficient to permit
---------------
each Holdings Owner to pay, the Theoretical Tax on the amount of the
taxable income of the Borrower and its Subsidiaries which is allocated to
ASC or the Holdings Owner, as applicable, for federal income tax purposes,
without regard to the individual tax status of any Holdings Owner or ASC
("Permitted Tax Dividends") and (B) to pay franchise taxes and other fees
-----------------------
required to maintain its existence and reasonable general administrative
costs and expenses, including, without limitation, directors fees and
expenses and administrative, legal and accounting services provided by
third parties, actually incurred by Holdings or ASC, as applicable;
(v) the Recapitalization shall be permitted;
(vi) the payment of any dividend by a Consolidated Subsidiary of
the Borrower to the holders of its common Capital Stock on a pro-rata basis
shall be permitted; and
(vii) (A) repurchases of Capital Stock deemed to occur upon the
cashless exercise of stock options and warrants; and (B) cash paid in lieu
of fractional Equity Interests (or dividends or distributions for such
purpose) in an aggregate amount not to exceed $50,000 shall be permitted.
Section 7.08 Prepayments of Indebtedness, etc.
---------------------------------
(a) Amendments of Debt Agreements. None of the Consolidated Parties
-----------------------------
will, or will permit any of their respective Subsidiaries to, after the issuance
thereof, amend, waive or modify (or permit the amendment, waiver or modification
of) any of the terms, agreements, covenants or conditions of or applicable to
(i) the Senior Subordinated Notes or (ii) any other Debt (other than the Credit
Obligations and, in the absence of any Default or Event of Default, Debt
permitted by Section 7.01(iii) and obligations secured by Vessel Permitted
-----------------
Liens) issued by such Consolidated Party if, in the case of Debt referred to in
this clause (ii) such amendment, waiver or modification would add or change any
-----------
terms, agreements, covenants or conditions in a manner materially adverse to any
Consolidated Party, or shorten the final maturity or average life to maturity or
require any payment to be made sooner than originally scheduled or increase the
interest rate applicable thereto or change any subordination provision thereof.
(b) Prohibition Against Certain Payments of Principal and Interest of
-----------------------------------------------------------------
Other Debt. None of the Consolidated Parties will, or will permit any of their
----------
respective Subsidiaries to, (i) directly or indirectly, redeem, purchase,
prepay, retire, defease or otherwise acquire for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any Debt (other
than the Credit Obligations and, in the absence of any Default or Event of
Default, Debt permitted by Section 7.01(iii)),
-----------------
112
or set aside any funds for such purpose, whether such redemption, purchase,
prepayment, retirement or acquisition is made at the option of the maker or at
the option of the holder thereof, and whether or not any such redemption,
purchase, prepayment, retirement or acquisition is required under the terms and
conditions applicable to such Debt, or (ii) release, cancel, compromise or
forgive in whole or in part any Debt evidenced by any Intercompany Note;
provided, that Debt evidenced by an Intercompany Note may be released, canceled,
--------
compromised or forgiven to the extent that the obligee thereof would at the time
be allowed to make an equity Investment in a like amount in the obligor pursuant
to Section 7.06(a).
---------------
(c) Amendments of the Credit Documents. None of the Consolidated
----------------------------------
Parties will, or will permit any of their respective Subsidiaries to, enter into
any agreement with any Person whereby any of them shall agree to any restriction
on the right of any Consolidated Party to amend or waive any of the provisions
of this Agreement or any other Credit Document.
Section 7.09 Transactions with Affiliates. None of the Consolidated
----------------------------
Parties will, or will permit any of their respective Subsidiaries to, engage in
any transaction or series of transactions with (i) any officer, managing
director, director, holder of Capital Stock, Subsidiary or Affiliate of ASLP,
(ii) any Affiliate of any such officer, managing director, director, holder,
Subsidiary or Affiliate or (iii) the Sponsor or any officer, managing director,
director, holder of Capital Stock, Subsidiary or Affiliate of the Sponsor, other
than (A) transfers of assets to any Credit Party permitted by Section 7.05, (B)
------------
transactions expressly permitted by Section 7.01, Section 7.04, Section 7.05,
------------ ------------ ------------
Section 7.06, Section 7.07 or Section 7.12, (C) normal compensation and
------------ ------------ ------------
reimbursement of reasonable fees and expenses of officers and directors, (D) any
transaction entered into and maintained among the Borrower and any of its
Subsidiaries or among such Subsidiaries, (E) so long as no Default or Event of
Default has occurred and is continuing, any transaction entered into and
maintained among any Consolidated Party and any non-Wholly-Owned Domestic
Subsidiaries of the Borrower and among any Consolidated Party and Foreign
Subsidiaries (including Joint Venture Entities) of the Borrower (F)
reimbursement of reasonable out-of-pocket expenses of the Sponsor, (G) payment
of fees to the Sponsor with respect to the Recapitalization, (H) the payment to
the Sponsor in connection with any acquisition or financing transaction of
advisory, underwriting and placement fees in amounts and on terms as favorable
to the Borrower as would be obtainable on an arms'-length basis from an
independent, unrelated third party, (I) transactions in existence on the
Effective Date, to the extent set forth on Schedule 7.09, (J) so long as no
-------------
Default or Event of Default has occurred and is continuing, other transactions
which are engaged in by any Consolidated Party in the ordinary course of its
business on terms and conditions as favorable to such Person as would be
obtainable by it in a comparable arms'-length transaction with an independent,
unrelated third party and (K) Investments permitted by Section 7.06(a) (xviii).
-----------------------
Section 7.10 Fiscal Year; Organizational and Other Documents. None of
-----------------------------------------------
Holdings or any Consolidated Parties will, or will permit any of their
respective Subsidiaries to, (i) change its fiscal year or consent to any
amendment, modification or supplement that is materially adverse to the Lenders
of any of the provisions of the Transaction Documents, the Senior Subordinated
Notes, or any other documents establishing and setting forth the rights and
terms of the Senior Subordinated Notes on the Effective Date, (ii) enter into
any amendment, modification or waiver that is adverse in any material respect to
the Lenders to any Material Contract as in effect on the Effective Date or (iii)
enter into any amendment, modification or waiver to its articles or certificate
of incorporation, bylaws (or analogous organizational documents) or any
agreement entered into by it with respect to its Capital Stock (including the
Securityholders' Agreement), in each case as in effect on the Effective Date;
provided that ASLP may cause Holdings to be converted from a limited liability
--------
company into a corporation. The Borrower will cause the Consolidated Parties to
promptly provide the Lenders with copies of all amendments to the foregoing
documents and instruments as in effect as of the Effective Date.
113
Section 7.11 Restrictions with Respect to Intercorporate Transfers.
-----------------------------------------------------
None of the Consolidated Parties will, or will permit any of their respective
Subsidiaries to, create or otherwise cause or permit to exist any encumbrance or
restriction which prohibits or otherwise restricts (i) the ability of any such
Subsidiary to (A) pay Restricted Payments or pay any Debt owed to the Borrower
or any Subsidiary of the Borrower, (B) pay Debt or other obligations owed to any
Credit Party, (C) make loans or advances to the Borrower or any Subsidiary of
the Borrower, (D) transfer any of its properties or assets to the Borrower or
any Subsidiary of the Borrower or (E) act as a Subsidiary Guarantor and pledge
its assets pursuant to the Credit Documents or any renewals, refinancings,
exchanges, refundings or extensions thereof or (ii) the ability of the Parent or
any Subsidiary of the Parent to create, incur, assume or permit to exist any
Lien upon its property or assets whether now owned or hereafter acquired to
secure the Obligations, except (in respect of any of the matters referred to in
clause (i)(A)-(D) or clause (ii) above) for prohibitions or restrictions
------------- --- -----------
existing under or by reason of:
(i) this Agreement and the other Credit Documents;
(ii) applicable law;
(iii) restrictions in effect on the date of this Agreement
contained in the Existing Debt Agreements all as in effect on the date of
this Agreement, and, if such Debt is renewed, extended or refinanced,
restrictions in the agreements governing the renewed, extended or
refinancing Debt (and successive renewals, extensions and refinancings
thereof) if such restrictions are no more restrictive than those contained
in the agreements governing the Debt being renewed, extended or refinanced;
(iv) customary non-assignment provisions with respect to leases
or licensing agreements entered into by the Borrower or any of its
Subsidiaries, in each case entered into in the ordinary course of business
and consistent with past practices;
(v) any restriction or encumbrance with respect to a Subsidiary
of the Borrower imposed pursuant to an agreement which has been entered
into for the sale or disposition of all or substantially all of the capital
stock or assets of such Subsidiary, so long as such sale or disposition is
permitted under this Agreement;
(vi) Liens permitted under Section 7.02 and any documents or
------------
instruments governing the terms of any Debt or other obligations secured by
any such Liens; provided that such prohibitions or restrictions apply only
--------
to the assets subject to such Liens;
(vii) restrictions in effect on the date of this Agreement
contained in the Senior Subordinated Note Documents; and
(viii) restrictions of the nature referred to in clause (D) above
----------
in favor of a Person who is not an Affiliate of a Credit Party contained in
agreements or documents granting or governing Capitalized Leases or Debt of
a Consolidated Party which is permitted under Section 7.01(iii) or (iv) if
-------------------------
and to the extent that such restriction relates only to the asset or assets
acquired with the proceeds of such Capitalized Lease or Debt incurred
pursuant to Section 7.01(iii) or (iv).
-------------------------
Section 7.12 Ownership of Subsidiaries; Limitations on the Parent and
--------------------------------------------------------
the Borrowers. (a) The Parent will not (i) permit any Person other than the
-------------
Parent or ASC to own any Capital Stock or Equity Equivalents in the Borrower or
permit any Person (other than the Borrower or any Wholly-Owned Subsidiary of the
Borrower) to own any Capital Stock of any Subsidiary of the Borrower, other than
non-Wholly-Owned Subsidiaries permitted under this Agreement and Joint Venture
Entities,
114
(ii) permit any Subsidiary of the Borrower to issue Capital Stock to any Person,
except (A) to the Borrower or any Wholly-Owned Subsidiary of the Borrower, (B)
to qualify directors where required by applicable law or to satisfy other
requirements of applicable law with respect to the ownership of Capital Stock of
Foreign Subsidiaries or (C) with respect to non-Wholly-Owned Subsidiaries
permitted under this Agreement and Joint Venture Entities or (iii) permit the
Borrower or any Subsidiary of the Parent to issue any shares of Preferred Stock.
(b) The Parent shall not (i) hold any assets other then the Capital
Stock of the Borrower and ASC and (ii) have any material liabilities other than
(A) liabilities under the Credit Documents and (B) tax liabilities in the
ordinary course of business or (iii) engage in any business or activity other
than (A) owning the Capital Stock of the Borrower and ASC (including purchasing
additional shares of common stock after the Effective Date if such shares are
pledged to the Collateral Agent under the Parent Pledge Agreement) and
activities incidental or related thereto on the maintenance of the corporate
existence of the Parent in compliance with applicable law and (B) acting as a
Guarantor under the Parent Guaranty Agreement and pledging its assets to the
Collateral Agent, for the benefit of the Lenders, pursuant to the Collateral
Documents to which it is a party.
Section 7.13 Sale/Leasebacks. None of the Consolidated Parties will,
---------------
directly or indirectly, become or remain liable as lessee or as guarantor or
other surety with respect to any lease, whether an Operating Lease or a Capital
Lease, or any property (whether real or personal or mixed), whether now owned or
hereafter acquired, (i) which such Consolidated Party has sold or transferred or
is to sell or transfer to a Person which is not a Consolidated Party or (ii)
which such Consolidated Party intends to use for substantially the same purpose
as any other property which has been sold or is to be sold or transferred by
such Consolidated Party to another Person which is not a Consolidated Party in
connection with such lease; provided, however, that the Borrower and its
-------- -------
Subsidiaries may enter into such transactions with respect to personal property
if (i) after giving effect on a Pro-Forma Basis to any such transaction the
Attributable Debt incurred in connection with such transaction is permitted
pursuant to Section 7.01, (ii) the gross cash proceeds of any such transaction
------------
are at least equal to the fair market value of such property (as determined by
the managing member of the Borrower, whose determination shall be conclusive if
made in good faith) and (iii) the Net Cash Proceeds are forwarded to the
Administrative Agent as set forth in Section 3.03(b)(iii) to the extent required
--------------------
therein.
Section 7.14 Capital Expenditures.
--------------------
(a) None of the Consolidated Parties will, or will permit any of their
respective Subsidiaries to, make any Consolidated Capital Expenditures, except
that during any fiscal year, the Borrower and its Subsidiaries may make
Consolidated Capital Expenditures so long as the aggregate amount of such
Consolidated Capital Expenditures does not exceed $10,000,000 during either of
the fiscal years ending on December 31, 2002 or 2003 or $12,500,000 in any
fiscal year thereafter.
(b) To the extent that Consolidated Capital Expenditures permitted
under subsection (a) above for any period set forth above are less than the
--------------
applicable amount specified in subsection (a) above, 100% of the difference may
--------------
be carried forward and utilized to make Consolidated Capital Expenditures solely
during the immediately succeeding fiscal year.
(c) Notwithstanding the foregoing, the Borrower and its Subsidiaries
may make Consolidated Capital Expenditures (which Consolidated Capital
Expenditures will not be included in any determination under subsection (a)
--------------
above) with the Net Cash Proceeds of Asset Dispositions, to the extent such Net
Cash Proceeds are not required to be applied to repay Loans or cash
collateralize LOC Obligations pursuant to Section 3.03(b)(iii).
--------------------
115
Section 7.15 Additional Negative Pledges. None of the Consolidated
---------------------------
Parties will enter into, assume or become subject to any agreement prohibiting
or otherwise restricting the creation or assumption of any Lien upon its
properties or assets, whether now owned or hereafter acquired, or requiring the
grant of any security for an obligation if security is given for some other
obligation, except (i) pursuant to this Agreement and the other Credit
Documents, (ii) pursuant to any document or instrument governing Debt incurred
pursuant to Section 7.01(iii) or (iv) if any such restriction contained therein
----------------- ----
relates only to the asset or assets acquired in connection therewith and (iii)
pursuant to the Senior Subordinated Notes.
Section 7.16 Impairment of Security Interests. None of the
--------------------------------
Consolidated Parties will, or will permit any of their respective Subsidiaries
to, (i) take or omit to take any action which action or omission might or would
materially impair the security interests in favor of the Collateral Agent with
respect to the Collateral or (ii) grant to any Person (other than the Collateral
Agent pursuant to the Collateral Documents) any interest whatsoever in the
Collateral, except for Permitted Liens.
Section 7.17 Sales of Receivables. None of the Consolidated Parties
--------------------
will, or will permit any of their respective Subsidiaries to, sell with
recourse, discount or otherwise sell or dispose of its accounts or notes
receivables.
Section 7.18 Financial Covenants.
-------------------
(a) Leverage Ratio. The Leverage Ratio as of the last day of any
--------------
fiscal quarter of the Borrower, in each case taken as a single accounting
period, will not be greater than the ratio set forth below opposite the period
during which such date occurs:
---------------------------------------------------
Period Ratio
---------------------------------------------------
Effective Date through June 30, 2003 4.75 to 1.0
---------------------------------------------------
July 1, 2003 through June 30, 2004 4.50 to 1.0
---------------------------------------------------
July 1, 2004 through June 30, 2005 4.25 to 1.0
---------------------------------------------------
July 1, 2005 through June 30, 2006 3.75 to 1.0
---------------------------------------------------
Thereafter 3.25 to 1.0
---------------------------------------------------
(b) Interest Coverage Ratio. The Interest Coverage Ratio for any
-----------------------
period of four consecutive fiscal quarters of the Borrower, in each case taken
as a single accounting period, ending on the last date of each fiscal quarter,
will not be less than the ratio set forth below opposite the period during which
such date occurs:
--------------------------------------------------------
Period Ratio
--------------------------------------------------------
Effective Date through December 31, 2002 2.00 to 1.0
--------------------------------------------------------
January 1, 2003 through December 31, 2003 2.10 to 1.0
--------------------------------------------------------
January 1, 2004 through December 31, 2004 2.25 to 1.0
--------------------------------------------------------
January 1, 2005 through December 31, 2005 2.50 to 1.0
--------------------------------------------------------
Thereafter 2.75 to 1.0
--------------------------------------------------------
(c) Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio for
---------------------------
any period of four consecutive fiscal quarters of the Borrower, in each case
taken as a single accounting period,
116
ending on the last date of each fiscal quarter will not be less than the ratio
set forth below opposite the period during which such date occurs:
-------------------------------------------------------
Period Ratio
-------------------------------------------------------
Effective Date through December 31, 2005 1.30 to 1.0
-------------------------------------------------------
Thereafter 1.10 to 1.0
-------------------------------------------------------
Section 7.19 Independence of Covenants. All covenants contained herein
-------------------------
shall be given independent effect so that if a particular action or condition is
prohibited by any of such covenants, the fact that such action or condition
would be permitted by an exception to, or otherwise be within the limitations
of, another covenant shall not avoid the occurrence of a Default if such action
is taken or condition exists.
ARTICLE VIII
DEFAULTS
Section 8.01 Events of Default. An Event of Default shall exist upon
-----------------
the occurrence of any of the following specified events or conditions (each an
"Event of Default"):
----------------
(a) Payment. The Borrower shall:
-------
(i) default in the payment when due (whether by scheduled
maturity, acceleration or otherwise) of any principal of any of the Loans
or of any reimbursement obligation arising from drawings under Letters of
Credit; or
(ii) default, and such default shall continue for three or more
Business Days, in the payment when due of any interest on the Loans, or of
any fees or other amounts owing hereunder, under any of the other Credit
Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement made or
---------------
deemed to be made by any Credit Party herein, in any of the other Credit
Documents, or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove untrue in any material respect
on the date as of which it was made or deemed to have been made.
(c) Covenants. Any Credit Party shall:
---------
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 6.01(i), 6.02, 6.09, 6.14 or
---------------- ---- ---- ----
7.01 through 7.18, inclusive;
---- ----
(ii) default in the due performance or observance by it of any
term, covenant or agreement contained in Article VI (other than those
----------
referred to in subsection (a), (b) or (c)(i) of this Section 8.01) and such
-------------- --- ------ ------------
default shall continue unremedied for a period of 15 Business Days after
the earlier of an executive officer of a Credit Party becoming aware of
such default or notice thereof given by the Administrative Agent; or
(iii) default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in subsections
-----------
(a), (b) or (c)(i) or (ii) of this Section 8.01) contained in this
--- --- ------ ---- ------------
Agreement and such default shall continue unremedied for a period of at
least 30 days after the earlier of an executive officer of a Credit Party
becoming aware of such default or notice thereof given by the
Administrative Agent.
117
(d) Other Credit Documents. (i) Any Credit Party shall default in the
----------------------
due performance or observance of any term, covenant or agreement in any of the
other Credit Documents and such default shall continue unremedied for a period
of at least 30 days after the earlier of an executive officer of a Credit Party
becoming aware of such default or notice thereof given by the Administrative
Agent, (ii) except pursuant to the terms thereof, any Credit Document shall fail
to be in full force and effect or any Credit Party shall so assert or (iii)
except pursuant to the terms thereof, any Credit Document shall fail to give the
Administrative Agent, the Collateral Agent and/or the Lenders the security
interests, liens, rights, powers and privileges purported to be created thereby.
(e) Bankruptcy, etc. A Bankruptcy Event shall occur with respect to
---------------
any Credit Party.
(f) Defaults under Other Agreements.
(i) With respect to any Debt (other than Debt outstanding under
the Credit Documents) in excess of $3,000,000 in the aggregate for the
Consolidated Parties, taken as a whole, (A) any Consolidated Party shall
default in any payment (beyond the applicable grace period with respect
thereto, if any) with respect to any such Debt, (B) any Consolidated Party
shall default in the observance or performance of any other term, covenant,
condition or agreement evidencing or securing such Debt or relating
thereto, or any other event or condition shall occur or condition exist,
the effect of which default or other event or condition is to cause, or
permit the holder or holders of such Debt (or trustee or agent on behalf of
such holders) to cause (determined without regard to whether any notice or
lapse of time is required) any such Debt (or any portion thereof) to become
due prior to its stated maturity; (C) any such Debt (or any portion
thereof) shall be declared due and payable, or shall be required to be
prepaid (other than by a regularly scheduled required payment or prepayment
to the extent permitted hereby) prior to the stated maturity thereof or (D)
any Consolidated Party shall be required by the terms of such Debt to offer
to prepay or repurchase such Debt (or any portion thereof) prior to the
stated maturity thereof.
(ii) there occurs under any Derivatives Agreement or Derivatives
Obligation an Early Termination Date (as defined in such Derivatives
Agreement) resulting from (A) any event of default under such Derivatives
Agreement as to which any Consolidated Party is the Defaulting Party (as
defined in such Derivatives Agreement) or (B) any Termination Event (as so
defined) as to which any Consolidated Party is an Affected Party (as so
defined), and, in either event, the Derivatives Termination Value owed by a
Consolidated Party as a result thereof is greater than $3,000,000 and
remains unpaid for five Business Days.
(g) Judgments. One or more judgments, orders, or decrees shall be
---------
entered against any Consolidated Party involving a liability of $3,000,000 or
more, in the aggregate (to the extent not paid or covered by insurance provided
by a carrier who has acknowledged coverage), and such judgments, orders or
decrees (i) are the subject of any enforcement proceeding commenced by any
creditor or (ii) shall continue unsatisfied, undischarged and unstayed for a
period ending on the first to occur of (A) the last day on which such judgment,
order or decree becomes final and unappealable or (B) 60 consecutive days.
(h) ERISA. The occurrence of any of the following events or
-----
conditions: (i) any "accumulated funding deficiency", as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Single Employer Plan, or any Lien shall arise on the
assets of any Credit Party or any of their Subsidiaries or any ERISA Affiliate
in favor of the PBGC or a Single Employer Plan; (ii) an ERISA Event shall occur
with respect to a Single Employer
118
Plan, which is, in the reasonable opinion of the Administrative Agent, likely to
result in the termination of such Plan for purposes of Title IV of ERISA; (iii)
an ERISA Event shall occur with respect to a Multiemployer Plan or Multiple
Employer Plan, which is, in the reasonable opinion of the Administrative Agent,
likely to result in (A) the termination of such Plan for purposes of Title IV of
ERISA, or (B) any Credit Party or any of their Subsidiaries or any ERISA
Affiliate incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or insolvency
(within the meaning of Section 4245 of ERISA) of such Plan; (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or Section 4975 of the
Code) or breach of fiduciary responsibility shall occur which may subject any
Credit Party or any of their Subsidiaries or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(1) of ERISA or Section 4975 of
the Code, or under any agreement or other instrument pursuant to which any
Credit Party or any of their Subsidiaries or any ERISA Affiliate has agreed or
is required to indemnify any Person against any such liability or (v) any other
event or condition out of the ordinary course of business shall occur or exist
with respect to any Plan; and, in each case in clauses (i) through (v) above,
----------- ---
such event or condition, together with all other such events or conditions, if
any, would reasonably be expected to involve possible taxes, penalties or other
liabilities affecting any Consolidated Party in an aggregate amount in excess of
$10,000,000 or require payments exceeding $5,000,000 in any fiscal year of the
Borrower.
(i) Environmental Matters. Either (i) any Consolidated Party shall be
---------------------
liable, whether directly, indirectly through required indemnification of any
Person or otherwise, for the costs of investigation and/or remediation of any
Hazardous Substances originating from or affecting any property or properties,
whether or not owned, leased or operated by such Consolidated Party, which
liability, together with all other such liabilities of such Consolidated Party,
could reasonably be expected to exceed $5,000,000 in the aggregate or require
payments by such Consolidated Party exceeding $2,000,000 in any fiscal year of
the Borrower or (ii) any Federal, state, regional, local or other environmental
regulatory agency or authority shall commence an investigation or take any other
action that, individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect;
(j) Guaranties. The Guaranties given by the Credit Parties or by any
----------
Additional Subsidiary Guarantor or any provision thereof shall, except pursuant
to the terms thereof, cease to be in full force and effect, or any Guarantor
thereunder or any Person acting by or on behalf of such Guarantor shall deny or
disaffirm in writing such Guarantor's obligations under such Guaranty.
(k) Ownership. There shall occur a Change of Control.
---------
(l) Subordinated Debt. The subordination provisions contained in the
-----------------
Senior Subordinated Note Documents or creating any other Subordinated Debt
shall, in whole or in part, terminate, cease to be effective or cease to be
legally valid, binding and enforceable as to any holder of the Senior
Subordinated Notes or such other Subordinated Debt.
Section 8.02 Acceleration; Remedies. Upon the occurrence of an Event
----------------------
of Default, and at any time thereafter unless and until such Event of Default
has been waived in writing by the Required Lenders (or the Lenders as may be
required pursuant to Section 10.06), the Administrative Agent (or the Collateral
-------------
Agent, as applicable) shall, upon the request and direction of the Required
Lenders, by written notice to the Borrower, take any of the following actions
without prejudice to the rights of the Agents or any Lender to enforce its
claims against the Credit Parties except as otherwise specifically provided for
herein:
(a) Termination of Commitments. Declare the Commitments terminated
--------------------------
whereupon the Commitments shall be immediately terminated.
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(b) Acceleration of Loans. Declare the unpaid principal of and any
---------------------
accrued interest in respect of all Loans, any reimbursement obligations arising
from drawings under Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by a Credit Party to any of the Lenders
hereunder to be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the Borrower
---------------
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default under Section 8.01(e), it will immediately pay) to the Collateral Agent
---------------
additional cash, to be held by the Collateral Agent, for the benefit of the
Lenders, in a cash collateral account as additional security for the LOC
Obligations in respect of subsequent drawings under all then outstanding Letters
of Credit in an amount equal to the maximum aggregate amount which may be drawn
under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and interests
---------------------
created and existing under the Credit Documents, including, without limitation,
all rights and remedies existing under the Collateral Documents, all rights and
remedies against a Guarantor and all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
-------
8.01(e) shall occur, then the Commitments shall automatically terminate and all
-------
Loans, all reimbursement obligations under Letters of Credit, all accrued
interest in respect thereof, all accrued and unpaid fees and other indebtedness
or obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Administrative
Agent or the Lenders, which notice or other action is expressly waived by the
Credit Parties. Notwithstanding the fact that enforcement powers reside
primarily with the Administrative Agent, each Lender has, to the extent
permitted by law, a separate right of payment and shall be considered a separate
"creditor" holding a separate "claim" within the meaning of Section 101(5) of
the Bankruptcy Code or any other insolvency statute.
In case any one or more of the covenants and/or agreements set forth in
this Agreement or any other Credit Document shall have been breached by any
Credit Party, then the Administrative Agent may proceed to protect and enforce
the Lenders' rights either by suit in equity and/or by action at law, including
an action for damages as a result of any such breach and/or an action for
specific performance of any such covenant or agreement contained in this
Agreement or such other Credit Document. Without limitation of the foregoing,
each of the Parent and the Borrower agrees that failure to comply with any of
the covenants contained herein will cause irreparable harm and that specific
performance shall be available in the event of any breach thereof. The
Administrative Agent acting pursuant to this paragraph shall be indemnified,
jointly and severally, by each of the Parent and the Borrower against all
liability, loss or damage, together with all reasonable costs and expenses
related thereto (including reasonable legal and accounting fees and expenses) in
accordance with Section 10.05.
-------------
Section 8.03 Allocation of Payments After Event of Default.
---------------------------------------------
Notwithstanding any other provisions of this Agreement, after the occurrence and
during the continuance of an Event of Default, all amounts collected or received
by the Administrative Agent or any Lender on account of amounts outstanding
under any of the Credit Documents or in respect of the Collateral shall be paid
over or delivered as follows:
120
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including reasonable attorneys' fees) of the Administrative Agent
or the Collateral Agent in connection with enforcing the rights of the
Creditors under the Credit Documents, including all reasonable expenses of
sale or other realization of or in respect of the Collateral, including
reasonable compensation to the agents and counsel for the Collateral Agent,
and all reasonable expenses, liabilities and advances incurred or made by
the Collateral Agent in connection therewith, and any other Obligations
owing to the Collateral Agent in respect of sums advanced by the Collateral
Agent to preserve the Collateral or to preserve its security interest in
the Collateral;
SECOND, to the payment of any fees owed to the Administrative
Agent;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses (including reasonable attorneys' fees) of (i) each of the Lenders
in connection with enforcing its rights under the Credit Documents or
otherwise with respect to the Credit Obligations owing to such lender and
(ii) each Derivatives Creditor in connection with enforcing any of its
rights under the Derivatives Agreements or otherwise with respect to the
Derivatives Obligations owing to such Derivatives Creditor, or, if the
proceeds are insufficient to pay in full the amount of such costs and
expenses, each Lender's and Derivatives Creditor's pro-rata share of the
amount remaining to have been distributed;
FOURTH, to the payment of all of the Credit Obligations
consisting of accrued fees and interest;
FIFTH, except as set forth in clauses First through Fourth above,
------------- ------
to the payment of the outstanding Credit Obligations and Derivatives
Obligations owing to any Creditor, pro rata, as set forth below, with (i)
an amount equal to the Credit Obligations being paid to the Collateral
Agent (in the case of Credit Obligations owing to the Collateral Agent) or
to the Administrative Agent (in the case of all other Credit Obligations)
for the account of the Lenders or any Agent, with the Collateral Agent,
each Lender and the Agents receiving an amount equal to its outstanding
Credit Obligations, or, if the proceeds are insufficient to pay in full all
Credit Obligations, its pro-rata share of the amount remaining to be
distributed, and (ii) an amount equal to the Derivatives Obligations being
paid to the trustee, paying agent or other similar representative (each a
"Representative") for the Derivatives Creditors, with each Derivatives
--------------
Creditor receiving an amount equal to the outstanding Derivatives
Obligations owed to it by the Credit Parties or, if the proceeds are
insufficient to pay in full all such Derivatives Obligations, its pro-rata
share of the amount remaining to be distributed;
SIXTH, to all other Obligations (the "Secondary Obligations"),
---------------------
until all Secondary Obligations shall have been paid in full or, if the
proceeds are insufficient to pay in full all Secondary Obligations, to each
Creditor, in an amount equal to such Creditor's pro-rata share of the
amount remaining to be distributed; and
SEVENTH, to the payment of the surplus, if any, to whomever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Creditors shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans, LOC
Obligations and Derivatives Obligations held by such Creditor bears to the
aggregate then outstanding Loans, LOC Obligations and Derivatives Obligations)
of
121
amounts available to be applied pursuant to clauses "THIRD," "FOURTH," "FIFTH,"
-------------- ------ -----
and "SIXTH" above; and (iii) to the extent that any amounts available for
-----
distribution pursuant to clause "FIFTH" above are attributable to the issued but
-------------
undrawn amount of outstanding Letters of Credit, such amounts shall be held by
the Collateral Agent in a cash collateral account and applied (x) first, to
-----
reimburse the Issuing Lender from time to time for any drawings under such
Letters of Credit and (y) then, following the expiration of all Letters of
----
Credit, to all other obligations of the types described in clauses "FIFTH" and
--------------
"SIXTH" above in the manner provided in this Section 8.03. Notwithstanding the
----- ------------
foregoing provisions of this Section 8.03, (i) amounts on deposit in a
------------
Prepayment Account for any Class of Loans upon the occurrence of any such Event
of Default shall be applied, first, to pay Loans of such Class and, second,
----- ------
after all the Loans of such Class have been paid in full, to the other Credit
Obligations in the manner provided in this Section 8.03 and (ii) amounts on
------------
deposit in a cash collateral account pursuant to Section 2.02(l) upon the
---------------
occurrence of any such Event of Default shall be applied, first, to reimburse
-----
the Issuing Lender from time to time for any drawings under any Letters of
Credit and, second, following the expiration of all Letters of Credit, to the
------
other Credit Obligations in the manner provided in this Section 8.03.
------------
ARTICLE IX
AGENCY PROVISIONS
Section 9.01 Appointment; Authorization.
(a) Appointment. Each Lender hereby designates and appoints Bank of
-----------
America, N.A., as Administrative Agent and as Collateral Agent, of such Lender
to act as specified herein and in the other Credit Documents, and each such
Lender hereby authorizes the Agents, as the agents for such Lender, to take such
action on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated by the terms hereof and of the other Credit Documents, together with
such other powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere herein and in the other Credit Documents,
the Agents shall not have any duties or responsibilities, except those expressly
set forth herein and therein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Credit Agreement or any of the other Credit
Documents, or shall otherwise exist against the Agents. The provisions of this
Section (other than Section 9.09) are solely for the benefit of the Agents and
------------
the Lenders and none of the Credit Parties shall have any rights as a third
party beneficiary of the provisions hereof (other than Section 9.09). In
------------
performing its functions and duties under this Credit Agreement and the other
Credit Documents, each Agent shall act solely as an agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for any Credit Party.
(b) Release of Collateral. The Lenders irrevocably authorize the
---------------------
Collateral Agent, at the Collateral Agent's option and in its discretion, but
subject to the following, to release any security interest in or Lien on any
Collateral granted to or held by the Collateral Agent (i) upon termination of
this Agreement and the other Credit Documents, termination of the Commitments
and all Letters of Credit and payment in full of all Obligations, including all
fees and indemnified costs and expenses that are payable pursuant to the terms
of the Credit Documents, (ii) if such Collateral constitutes property sold or to
be sold or disposed of as part of or in connection with any disposition
permitted pursuant to the terms of this Credit Agreement and (iii) if approved
by the Required Lenders or Lenders, as applicable, pursuant to the terms of
Section 10.06, and in each case the Administrative Agent shall instruct the
-------------
Collateral Agent to release such security interest or Lien upon the reasonable
written request of the Borrower and in
122
accordance with Section 7.11 of the Security Agreement. Upon the request of the
Collateral Agent, the Lenders will confirm in writing the Collateral Agent's
authority to release particular types or items of Collateral pursuant to this
Section 9.01(b).
---------------
(c) Release of Guarantors. The Lenders irrevocably authorize the
---------------------
Administrative Agent, at the Administrative Agent's option and in its
discretion, but subject to the following, to release any Guarantor from its
obligations hereunder if (i) such Guarantor is no longer required to be a
Guarantor pursuant to the terms of this Agreement or (ii) if approved by the
Required Lenders or Lenders, as applicable, pursuant to the terms of Section
-------
10.06, and in each case the Administrative Agent shall release such Guarantor,
-----
upon the reasonable written request of the Borrower, in accordance with the
Guaranty. Upon the request of the Administrative Agent, the Lenders will confirm
in writing the Administrative Agent's authority to release a particular
Guarantor pursuant to this Section 9.01.
------------
Section 9.02 Delegation of Duties. An Agent may execute any of its
--------------------
duties hereunder or under the other Credit Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. An Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
Section 9.03 Exculpatory Provisions. Neither the Agents nor any of
----------------------
their officers, directors, employees, agents, attorneys-in-fact or affiliates
shall be (i) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection herewith or in connection with any of the
other Credit Documents (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by any of the
Credit Parties contained herein or in any of the other Credit Documents or in
any certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by an Agent under or in
connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of any Credit Party to perform its obligations hereunder or
thereunder. The Agents shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by any Credit Party in any written or oral statement or in any
financial or other statements, instruments, reports, certificates or any other
documents in connection herewith or therewith furnished or made by an Agent to
the Lenders or by or on behalf of the Credit Parties to the Agents or any Lender
or be required to ascertain or inquire as to the performance or observance of
any of the terms, conditions, provisions, covenants or agreements contained
herein or therein or as to the use of the proceeds of the Loans or the use of
the Letters of Credit or of the existence or possible existence of any Default
or Event of Default or to inspect the properties, books or records of the Credit
Parties. The Agents are not trustees for the Lenders and owe no fiduciary duty
to the Lenders.
Section 9.04 Reliance on Communications. The Agents shall be entitled
--------------------------
to rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to any of
the Credit Parties, independent accountants and other experts selected by the
Agents with reasonable care). The Agents may deem and treat the Lenders as the
owner of its interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 10.03(b). The Agents shall be
----------------
fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
123
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Agents shall in all cases
be fully protected in acting, or in refraining from acting, hereunder or under
any of the other Credit Documents in accordance with a request of the Required
Lenders (or to the extent specifically provided in Section 10.06, all the
-------------
Lenders) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders (including their successors and
assigns).
Section 9.05 Notice of Default. An Agent shall not be deemed to have
-----------------
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless such Agent has received notice from a Lender or a Credit Party
referring to the Credit Document, describing such Default or Event of Default
and stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders.
Section 9.06 Non-Reliance on Agents and Other Lenders. Each Lender
----------------------------------------
expressly acknowledges that neither the Agents nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by the Agents or any
affiliate thereof hereinafter taken, including any review of the affairs of any
Credit Party, shall be deemed to constitute any representation or warranty by
the Agents to any Lender. Each Lender represents that it has, independently and
without reliance upon the Agents or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans hereunder and enter into this Agreement.
Each Lender also represents that it will, independently and without reliance
upon the Agents or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action under this
Agreement, and to make such investigation as it deems necessary to inform itself
as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Credit Parties. Each Lender
represents that it is a bank, savings and loan association or other similar
savings institution, insurance company, investment fund or company or other
financial institution which makes or acquires commercial loans in the ordinary
course of its business, that it is participating hereunder as a Lender for its
account and for such commercial purposes, and that it has the knowledge and
experience to be and is capable of evaluating the merits and risks of being a
Lender hereunder. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Agents shall not have any duty or responsibility to provide any Lender with
any credit or other information concerning the business, operations, assets,
property, financial or other conditions, prospects or creditworthiness of the
Credit Parties which may come into the possession of the Agents or any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates.
Section 9.07 Indemnification. The Lenders agree to indemnify each
---------------
Agent in its capacity as such (to the extent not reimbursed by the Parent or the
Borrower and without limiting the obligation of the Parent or the Borrower to do
so), ratably according to their respective Commitments (or if the Commitments
have expired or been terminated, in accordance with the respective principal
amounts of outstanding Loans and Participation Interests of the Lenders), from
and against any and all liabilities, obligations, losses, damages, penalties,
action, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including without limitation at any time
following payment in full of the Obligations) be imposed on, incurred by or
asserted against an Agent in its capacity as such in any way relating to or
arising out of this Credit Agreement or the other Credit Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or
124
thereby or any action taken or omitted by an Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
--------
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of an Agent. If any indemnity furnished
to an Agent for any purpose shall, in the opinion of such Agent, be insufficient
or become impaired, such Agent may call for additional indemnify and cease, or
not commence, to do the acts indemnified against until such additional indemnity
is furnished; provided that no Agent shall be indemnified for any event caused
--------
by its gross negligence or willful misconduct. The agreements in this Section
shall survive the payment of the Obligations and all other obligations and
amounts payable hereunder and under the other Credit Documents.
Section 9.08 Agents in Their Individual Capacity. Each Agent and its
-----------------------------------
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Parent or any other Credit Party as though such Agent
were not an Agent hereunder. With respect to the Loans made and Letters of
Credit issued and all obligations owing to it, an Agent shall have the same
rights and powers under this Credit Agreement as any Lender and may exercise the
same as though it was not an Agent, and the terms "Lender" and "Lenders" shall
include each Agent in its individual capacity.
Section 9.09 Successor Agent. Any Agent may, at any time, resign upon
---------------
60 days' written notice to the Lenders. Upon any such resignation, the Required
Lenders shall have the right to appoint a successor Agent (which successor Agent
shall be reasonably satisfactory to the Borrower so long as no Event of Default
shall have occurred and be continuing at the time of such appointment). If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, with 30 days after the notice of resignation,
then the Borrower shall have the right to appoint a successor Agent provided
such successor is a Lender hereunder or a commercial bank organized under the
laws of the United States of America or of any State thereof and has a combined
capital and surplus of at least $400,000,000. Upon the acceptance of any
appointment as an Agent hereunder by a successor, 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 as an Agent, as appropriate, under this
Agreement and the other Credit Documents and the provisions of this Section 9.09
------------
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was an Agent under this Credit Agreement. If no successor
Administrative Agent has accepted appointment as Administrative Agent within 60
days after the retiring Administrative Agent's giving notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless become effective
and the Lenders shall perform all duties of the Administrative Agent hereunder
until such time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided for above. Likewise, if no successor Collateral
Agent has accepted appointment as Collateral Agent within 60 days after the
retiring Collateral Agent's giving notice of resignation, the retiring
Collateral Agent's resignation shall nevertheless become effective and the
Lenders shall perform all duties of the Collateral Agent under the Collateral
Documents until such time, if any, as the Required Lenders appoint a successor
Collateral Agent as provided for above. Subject to the foregoing terms of this
Section 10.09, there shall at all times be a Person or Persons serving as
-------------
Administrative Agent hereunder and, so long as no Default or Event of Default
shall have occurred and be continuing, the appointment of any new Administrative
Agent shall require the consent of the Borrower (which consent shall not be
unreasonably withheld).
Section 9.10 Agents' Fees; Arranger Fee. The Borrower shall pay to the
--------------------------
Administrative Agent for its own account, to the Collateral Agent for its own
account and to BAS, in its capacity as Lead Arranger, for its own account, fees
in the amounts and at the times previously agreed upon between the Borrower and
the Administrative Agent, the Collateral Agent and BAS, respectively, in each
case with respect to this Agreement the other Credit Documents and the
transactions contemplated hereby and thereby.
125
Section 9.11 AFA Compliance.
--------------
(a) Bank of America, N.A. represents and warrants, but solely on and
as of the Effective Date, that (i) it is eligible to be the Mortgagee (as
defined in the Vessel Mortgages) under the Vessel Mortgages under applicable
Requirements of Law in effect on the Effective Date and (ii) its acting as the
Mortgagee under the Vessel Mortgages on and as of the Effective Date does not
disqualify any of the Vessels named in the Vessel Mortgages for documentation
with a fishery endorsement under Chapter 121 of Title 46 of the United States
Code (any such disqualification being herein referred to as a "Fisheries
---------
Disqualification").
----------------
(b) Subject to Section 10.06, Bank of America, N.A. shall act as
-------------
Mortgagee under the Vessel Mortgages as trustee for the Beneficiaries (as
defined and named therein) (in such capacity, and including its successor or
successors in such capacity from time to time, a "Vessel Mortgage Trustee").
-----------------------
(c) Each successor Collateral Agent appointed as such pursuant to the
provisions of Section 9.09 hereof shall be an Eligible Vessel Trustee, and any
------------
Collateral Agent retiring or proposing to retire in such capacity shall, subject
to the provisions set forth in Section 9.09 hereof, assign its rights as
------------
Mortgagee under the Vessel Mortgages in fact and of record with the United
States Coast Guard to a successor Collateral Agent (selected with the approval
of the Collateral Agent in accordance with the procedures specified in Section
-------
9.09) that is an Eligible Vessel Trustee, which shall thereafter act as
----
Mortgagee under the Vessel Mortgages. As used in this Section 9.11(c), the term
---------------
"Eligible Vessel Trustee" means a Person that is eligible to be a Vessel
-----------------------
Mortgage Trustee under applicable Requirements of Law without causing a
Fisheries Disqualification at the relevant time.
ARTICLE X
MISCELLANEOUS
Section 10.01 Notices. Except as otherwise expressly provided herein,
-------
all notices and other communications shall have been duly given and shall be
effective (i) when delivered, (ii) when transmitted via telecopy (or other
facsimile device) to the number set out below or on the applicable
Administrative Questionnaire, as applicable, (iii) the Business Day following
the day on which the same has been delivered prepaid (or on an invoice basis) to
a reputable national overnight air courier service or (iv) the third Business
Day following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address or
telecopy numbers, in the case of Holdings, the Parent, the Borrower and the
Administrative Agent, set forth below, and, in the case of the Lenders, set
forth on the applicable Administrative Questionnaire, or at such other address
as such party may specify by written notice to the other parties hereto:
if to Holdings, the Parent or the Borrower,
American Seafoods Group LLC
c/o Centre Partners Management LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
126
American Seafoods Group LLC
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Hallvard Muri
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Debevoise & ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Administrative Agent,
(for payments and requests for credit extensions)
Bank of America, N.A.
Agency Services
NCI 001 15 04
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Bank of America, N.A.
Charlotte, North Carolina
ABA ▇▇▇▇▇▇▇▇▇
Account 1366212250600
Attention Credit Services
Ref American Seafoods Group
127
(for all other notices to the Administrative Agent)
Bank of America, N.A.
Agency Management
CA5 701 05 19
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Bank of America, N.A.
Bank of America Corporate Center, 7th Floor
NC1-007-13-06
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: S. ▇▇▇▇ ▇▇▇▇▇▇▇
Managing Director
Financial Sponsor Portfolio Group
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Mayer, Brown, ▇▇▇▇ & Maw
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Section 10.02 Right of Set-Off. In addition to any rights now or
----------------
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence and during the continuance of
an Event of Default, each Lender (and each of its Affiliates) is authorized at
any time and from time to time, without presentment, demand, protest or other
notice of any kind (all of such rights being hereby expressly waived), to
set-off and to appropriate and apply any and all deposits (general or specific)
and any other indebtedness at any time held or owing by such Lender (including,
without limitation, branches, agencies or Affiliates of such Lender wherever
located) to or for the credit or the account of any Credit Party against
obligations and liabilities of such Credit Party to the Lenders hereunder, under
the Notes, under the other Credit Documents or otherwise, irrespective of
whether the Administrative Agent or the Lenders shall have made any demand
hereunder and although such obligations, liabilities or claims, or any of them,
may be contingent or unmatured, and any such set-off shall be deemed to have
been made immediately upon the occurrence of an Event of Default even though
such charge is made or entered on the books of such Lender subsequent thereto.
The Credit Parties hereby agree that to the extent permitted by law any Person
purchasing a participation in the Loans and Commitments hereunder pursuant to
Section 2.05(c), 3.13 or 10.03(d) may exercise all rights of set-off with
--------------- ---- --------
respect to its participation interest as fully as if such Person were a Lender
hereunder and any such set-off shall reduce the amount owed by such Credit party
to the Lender. Any Lender having exercised the rights of set-off provided for in
this Section 10.02 shall give the Borrower prompt written notice of
-------------
128
such exercise; provided, that the failure to give such notice shall not affect
--------
the validity of the exercise of such right.
Section 10.03 Benefit of Agreement.
--------------------
(a) Generally. This Agreement shall be binding upon and inure to the
---------
benefit of and be enforceable by the respective successors and assigns of the
parties hereto and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the Administrative Agent and each
Lender and any attempted or purported assignment in contravention of the
preceding sentence shall be null and void; provided that none of the Credit
--------
Parties may assign or transfer any of its interests and obligations in violation
of Section 7.04 or 7.05 or without the prior written consent of either the
------------ ----
Required Lenders or the Lenders, as the terms set forth in Section 10.06 may
-------------
require; and provided further that the rights of each Lender to transfer, assign
-------- -------
or grant participations in its rights and/or obligations hereunder shall be
limited as set forth below in this Section 10.03.
-------------
(b) Assignments. Each Lender may assign all or a portion of its rights
-----------
and obligations under this Agreement (including, without limitation, all or a
portion of its Loans, its Notes, and its Commitment); provided, however, that
-------- -------
(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender, an
Affiliate of an existing Lender or any fund that invests in bank loans and
is advised or managed by an investment advisor to an existing Lender or an
Affiliate of such existing Lender or an assignment of all of a Lender's
rights and obligations under this Agreement, any such partial assignment
shall be in an amount at least equal to $1,000,000;
(iii) each such assignment by a Lender shall be of a constant,
and not varying, percentage of all rights and obligations in respect of a
particular Class of Commitments under this Agreement and the other Credit
Documents;
(iv) the parties to such assignment shall execute and deliver to
the Administrative Agent and, only with respect to any assignment of all or
a portion of the Revolving Committed Amount, the Issuing Lenders for their
acceptance an Assignment and Assumption Agreement in the form of Exhibit C,
---------
together with any Note subject to such assignment and, except in the case
of an assignment to another Lender, an Affiliate of an existing Lender or
any fund that invests in bank loans and is advised or managed by an
investment advisor to an existing Lender or an Affiliate of such existing
Lender, a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and Assumption
Agreement, the assignee thereunder shall be a party hereto and, to the extent of
such assignment, have the obligations, rights, and benefits of a Lender
hereunder and the assigning Lender shall, to the extent of such assignment,
relinquish its rights and be released from its obligations under this Credit
Agreement. Upon the consummation of any assignment pursuant to this Section
-------
10.03(b), the assignor, the Administrative Agent and the Credit Parties shall
--------
make appropriate arrangements so that, if required, new Notes are issued to the
assignor and the assignee. If the assignee is not a United States person under
Section 7701(a)(30) of the Code, it shall deliver to the Credit Parties and the
Administrative Agent certification as to exemption from deduction or withholding
of Taxes in accordance with Section 3.10.
------------
129
By executing and delivering an assignment agreement in accordance with
this Section 10.03(b), the assigning Lender thereunder and the assignee
----------------
thereunder shall be deemed to confirm to and agree with each other and the other
parties hereto as follows: (i) such assigning Lender warrants that it is the
legal and beneficial owner of the interest being assigned thereby free and clear
of any adverse claim and the assignee warrants that it is an Eligible Assignee;
(ii) except as set forth in clause (i) above, such assigning Lender makes no
----------
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, any of the
other Credit Documents or any other instrument or document furnished pursuant
hereto or thereto or the financial condition of the Credit Parties or the
performance or observance by any Credit Party of any of its obligations under
this Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such assignment
agreement; (iv) such assignee confirms that it has received a copy of this
Agreement, the other Credit Documents and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such assignment agreement; (v) such assignee will independently and
without reliance upon the Administrative Agent, such assigning Lender or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Credit Agreement and the other Credit Documents;
(vi) such assignee appoints and authorizes the Administrative Agent to take such
action on its behalf and to exercise such powers under this Credit Agreement or
any other Credit Document as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance with
their terms all the obligations which by the terms of this Agreement and the
other Credit Documents are required to be performed by it as a Lender.
(c) Register. The Borrower hereby designates the Administrative Agent
--------
to serve as the Borrower's agent, solely for purposes of this subsection
----------
10.03(c), to (i) maintain a register (the "Register") on which the
-------- --------
Administrative Agent will record the Commitments from time to time of each
Lender, the Loans made by each Lender and each repayment in respect of the
principal amount of the Loans of each Lender and to (ii) retain a copy of each
Assignment and Assumption Agreement delivered to the Administrative Agent
pursuant to this Section. Failure to make any such recordation, or any error in
such recordation, shall not affect any Borrower's obligation in respect of such
Loans. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent, the Issuing Lenders
and the Lenders shall treat each Person in whose name a Loan and the Note
evidencing the same is registered as the owner thereof for all purposes of this
Agreement, notwithstanding notice or any provision herein to the contrary. With
respect to any Lender, the assignment or other transfer of the Commitments of
such Lender and the rights to the principal of, and interest on, any Loan made
and any Note issued pursuant to this Agreement shall not be effective until such
assignment or other transfer is recorded on the Register and, except to the
extent provided in this subsection 10.03(c), otherwise complies with Section
------------------- -------
10.03, and prior to such recordation all amounts owing to the transferring
-----
Lender with respect to such Commitments, Loans and Notes shall remain owing to
the transferring Lender. The registration of assignment or other transfer of all
or part of any Commitments, Loans and Notes for a Lender shall be recorded by
the Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Assumption Agreement and payment of the administrative fee referred to in
Section 10.03(b)(iv). The Register shall be available at the offices where kept
--------------------
by the Administrative Agent for inspection by the Borrower and any Lender at any
reasonable time upon reasonable prior notice to the Administrative Agent.
Neither the Parent nor the Borrower may replace any Lender pursuant to Section
-------
3.04(d), unless, with respect to any Notes held by such Lender, the
-------
requirements of subsection 10.03(b) and this subsection 10.03(c) have been
------------------- -------------------
satisfied.
130
(d) Participations. Each Lender may sell participations to one or more
--------------
Persons (each, a "Participant") in all or a portion of its rights, obligations
-----------
or rights and obligations under this Agreement (including all or a portion of
its Commitment or its Loans); provided, however, that (i) such Lender's
-------- -------
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) the Participant shall be entitled to the benefit of the
yield protection provisions contained in Section 3.06, 3.09, 3.10 and 3.11,
------------ ---- ---- ----
inclusive, and, to the extent permitted by law, the right of set-off contained
in Section 10.02 and (iv) the Credit Parties shall continue to deal solely and
------------- ----
directly with such Lender in connection with such Lender's rights and
obligations under this Credit Agreement, and such Lender shall retain the sole
right to enforce the obligations of the Credit Parties relating to the
Obligations owing to such Lender and to approve any amendment, modification or
waiver of any provision of this Credit Agreement (other than amendments,
modifications or waivers decreasing the amount of principal of or the rate at
which interest is payable on such Loans or Notes, extending any scheduled
principal payment date or date fixed for the payment of interest on such Loans
or Notes or extending its Commitment).
(e) Regulatory Assignments. Notwithstanding any other provision set
----------------------
forth in this Agreement, any Lender may at any time assign and pledge all or any
portion of its Loans and its Notes to (i) any Federal Reserve Bank as collateral
security pursuant to Regulation A and any Operating Circular issued by such
Federal Reserve Bank and (ii) any trustee for, or other representative of, any
fund that invests in bank loans and is advised or managed by an investment
advisor to a Lender or an Affiliate of such Lender, as collateral security. No
such assignment shall release the assigning Lender from its obligations
hereunder.
(f) Information. Any Lender may furnish any information concerning any
-----------
Credit Party or any of their respective Subsidiaries in the possession of such
Lender from time to time to assignees and participants (including prospective
assignees and participants), subject, however, to the provisions of Section
-------
10.16.
-----
(g) Other Funding Vehicles. Notwithstanding anything to the contrary
----------------------
contained herein, any Lender, (a "Granting Lender") may grant to a special
---------------
purpose funding vehicle (an "SPC") the option to fund all or any part of any
---
Loan that such Granting Lender would otherwise be obligated to fund pursuant to
this Agreement; provided that (i) nothing herein shall constitute a commitment
--------
by any SPC to fund any Loan, (ii) if an SPC elects not to exercise such option
or otherwise fails to fund all or any part of such Loan, the Granting Lender
shall be obligated to fund such Loan pursuant to the terms hereof, (iii) no SPC
shall have any voting rights pursuant to Section 10.06 and (iv) with respect to
------------- ----
notices, payments and other matters hereunder, the Parent, the Borrower, the
Administrative Agent and the Lenders shall not be obligated to deal with an SPC,
but may limit their communications and other dealings relevant to such SPC to
the applicable Granting Lender. The funding of a Loan by an SPC hereunder shall
utilize the Revolving Loan Commitment of the Granting Lender to the same extent
that, and as if, such Loan were funded by such Granting Lender. Each party
hereto hereby agrees that no SPC shall be liable for any indemnity or payment
under this Agreement for which a Lender would otherwise be liable.
Notwithstanding anything to the contrary contained in this Agreement, any SPC
may disclose on a confidential basis any non-public information relating to its
funding of Loans to any rating agency, commercial paper dealer or provider of
any surety or guarantee to such SPC. This subsection (g) may not be amended
--------------
without the prior written consent of each Granting Lender, all or any part of
whose Loan is being funded by an SPC at the time of such amendment.
(h) Certain Limitations on Rights of Assignees and Participations. No
-------------------------------------------------------------
Eligible Assignee, Participant or other transferee of any Lender's rights shall
be entitled to receive any greater payment under Section 3.06 or 3.10 than such
------------ ----
Lender would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by reason
131
of the provisions of Section 3.06, 3.07, 3.08 or 3.10 requiring such Lender to
------------ ---- ---- ----
designate a different Applicable Lending Office under certain circumstances or
at a time when the circumstances giving rise to such greater payment did not
exist. To the extent that, at the time of any assignment pursuant to Section
-------
10.03(b) to a Person not already a Lender hereunder, the Eligible Assignee would
--------
be entitled to charge the Borrower for any taxes or additional amounts pursuant
to Section 3.06 or 3.10 in excess of the aggregate of such amounts permitted to
------------ ----
be charged by the assigning Lender immediately prior to such assignment (which
differences may arise, for example, because of differences between the Eligible
Assignee and the assigning Lender, or because of the different laws, treaties or
regulations, or interpretations thereof, applicable to such Persons), the
Borrower shall not be obligated to pay such excess taxes, and other amounts, it
being understood and agreed, however, that the Borrower shall be obligated to
pay to such Eligible Assignee all other taxes and other amounts which are
otherwise required to be reimbursed pursuant to Section 3.06 and 3.10
------------ ----
(including, without limitation, all such Non-Excluded Taxes and other amounts
payable as a result of events occurring after the date of the respective
assignment).
(i) Lost and Mutilated Notes. If any Note becomes mutilated and is
------------------------
surrendered by the Lender with respect thereto to the Borrower, or if any Lender
claims that any of its Notes has been lost, destroyed or wrongfully taken, the
Borrower shall execute and deliver to such Lender a replacement Note, upon the
affidavit of such Lender attesting to such loss, destruction or wrongful taking
with respect to such Note together with, in the case of any lost, destroyed or
wrongfully taken Note, an indemnity if so requested by the Borrower, and such
lost, destroyed, mutilated, surrendered or wrongfully taken Note shall be deemed
to be canceled for all purposes hereof. Such affidavit shall be accepted as
satisfactory evidence of the loss, wrongful taking or destruction thereof and no
surety or bond shall be required as a condition of the execution and delivery of
a replacement Note. Any reasonable costs and expenses of the Parent or the
Borrower in replacing any such Note shall be for the account of such Lender.
Section 10.04 No Waiver; Remedies Cumulative. No failure or delay on
------------------------------
the part of an Agent or any Lender in exercising any right, power or privilege
hereunder or under any other Credit Document and no course of dealing between
the Agents or any Lender and any of the Credit Parties shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein are cumulative
and not exclusive of any rights or remedies which the Agents or any Lender would
otherwise have. No notice to or demand on any Credit Party in any case shall
entitle the Credit Parties to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the Agents or the
Lenders to any other or further action in any circumstances without notice or
demand.
Section 10.05 Payment of Expenses; Indemnification.
(a) Expenses. The Borrower agrees to pay on demand all reasonable
--------
out-of-pocket costs and expenses of: (i) the Agents in connection with (A) the
syndication, negotiation, preparation, execution and delivery and administration
of this Agreement and the other Credit Documents and the other documents and
instruments referred to herein and therein (including, without limitation, the
reasonable fees and expenses of Mayer, Brown, ▇▇▇▇ & Maw, special counsel to the
Agents, and the reasonable and documented fees and expenses of such counsel and
other special counsel for the Agents in connection with maritime or foreign
issues), and (B) any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructuring
relating to the performance by the Credit Parties under this Agreement, and (ii)
upon the occurrence and during the continuation of an Event of Default the
Agents and the Lenders in connection with (A) enforcement of the Credit
Documents and the documents and instruments referred to therein, including,
without limitation, in connection with any such
132
enforcement, the reasonable fees and disbursements of counsel for the Agents and
each of the Lenders, and (B) any bankruptcy or insolvency proceeding of a Credit
Party.
(b) Indemnification. The Parent and the Borrower, jointly and
---------------
severally, agree to indemnify each Agent and each Lender and their respective
affiliates, controlling persons, officers, directors, employees,
representatives, trustees, advisors and agents (each an "Indemnitee") from and
----------
hold each of them harmless against any and all losses, liabilities, obligations,
penalties, actions, judgments, suits, costs, disbursements, claims, damages or
expenses incurred by any of them as a result of, or arising out of, or in any
way related to, or by reason of, any investigation, litigation or other
proceeding (whether or not any Agent or Lender or other Indemnitee is a party
thereto) related to (i) the entering into and/or performance of any Credit
Document or the use or proceeds of any Loans (including other extensions of
credit) hereunder or the consummation of any other transactions contemplated in
any Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
obligations, penalties, actions, judgments, suits, costs, disbursements, claims,
damages or expenses to the extent incurred by reason of gross negligence or
willful misconduct on the part of the Person to be indemnified), (ii) any
Environmental Claim (except to the extent such claim arises from the gross
negligence or willful misconduct of any Indemnitee) and (iii) any claims for
Non-Excluded Taxes; provided that no indemnity or reimbursement shall be
--------
required in respect of (i) any claims relating to the obligations of any
Indemnitee in any capacity other than as an Agent or a Lender or (ii) any claims
against a Lender relating to a breach by such Lender of this Agreement. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section 10.05(b) applies, such indemnity shall be effective whether or
----------------
not such investigation, litigation or proceeding is brought by any Credit Party,
its directors, shareholders or creditors or an Indemnitee or any other Person or
any Indemnitee is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. Each of the Parent and the Borrower agrees
not to assert any claim against any Agent, any Lender, any other Creditor, any
of their Affiliates or any of their respective directors, officers, employees,
attorneys, agents and advisers, on any theory of liability, for special,
indirect, consequential or punitive damages arising out of or otherwise relating
to the Credit Documents, any of the transactions contemplated herein or therein
or the actual or proposed use of the proceeds of the Loans or of the Letters of
Credit.
(c) Survival. Without prejudice to the survival of any other agreement
--------
of the Credit Parties hereunder and under the other Credit Documents, the
agreements and obligations of the Credit Parties contained in this Section 10.05
-------------
shall survive the repayment of the Loans, LOC Obligations and other obligations
under the Credit Documents and the termination of the Commitments hereunder.
Section 10.06 Amendments, Waivers and Consents. Neither this Agreement
--------------------------------
nor any other Credit Document nor any of the terms hereof or thereof may be
amended, changed, waived, discharged or terminated unless such amendment,
change, waiver, discharge or termination is in writing and signed by the
Required Lenders and the Credit Parties and acknowledged by the Administrative
Agent; provided, that:
--------
(i) no such amendment, change, waiver, discharge or termination
shall, without the consent of each Lender affected thereby;
(A) extend or waive the final maturity of any Loan or the
time of payment of any reimbursement obligation, or any portion
thereof, arising from drawings under Letters of Credit, or extend,
waive, reduce or forgive any Principal Amortization Payment, or any
portion thereof;
133
(B) reduce the rate or extend the time of or waive any
payment of interest (other than as a result of waiving the
applicability of any post-default increase in interest rates) on any
Obligation or fees hereunder;
(C) reduce or waive the principal amount of any Loan or any
reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit;
(D) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
Default or Event of Default or a mandatory reduction in the
Commitments shall not constitute a change in the terms of any
Commitment of any Lender);
(E) release all or substantially all of the Collateral
securing the Credit Obligations hereunder (provided that the
--------
Collateral Agent may, without consent from any other Lender, release
any Collateral that is sold or transferred by a Credit Party in
compliance with Section 7.05);
------------
(F) release the Parent or the Borrower or substantially all
of the other Credit Parties from its or their obligations under the
Credit Documents (provided that the Administrative Agent may, without
--------
the consent of any other Lender, release any Guarantor that is sold or
transferred in compliance with Section 7.05);
------------
(G) amend, modify or waive any provision of this Section
-------
10.06 or Section 3.04, 3.06, 3.07, 3.08, 3.09, 3.10, 3.11, 3.12, 3.13,
----- ------------ ---- ---- ---- ---- ---- ---- ---- ----
8.01(a), 8.03, 10.02, 10.03, 10.05 or 10.09;
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(H) reduce any percentage specified in, or otherwise modify,
the definition of Required Lenders;
(I) consent to the assignment or transfer by the Parent or
the Borrower or all or substantially all of the other Credit Parties
of any of its or their rights and obligations under (or in respect of)
the Credit Documents, except as permitted thereby; or
(J) effect any waiver of the conditions to funding any
Revolving Loan or Swingline Loan or to issuing any Letter of Credit in
each case after the Effective Date, without the prior written consent
of Lenders having in the aggregate at least a majority of the
outstanding principal amount of Revolving Loans, LOC Obligations and
unused Revolving Credit Commitments;
(ii) no such amendment, change, waiver, discharge or termination
shall,
(A) extend the time for, reduce the amount of or modify the
manner of application of proceeds of any mandatory prepayment required
by Section 3.03(b)(ii), (iii), (iv) or (v), without the prior written
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consent of Lenders holding in the aggregate at least a majority of the
outstanding principal amount of the Tranche A Term Loans and Lenders
holding in the aggregate at least a majority of the outstanding
principal amount of the Tranche B Term Loans; or
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(B) effect any waiver, amendment or modification that by its
terms adversely affects the rights, in respect of payments, the
Collateral or the guarantees by the Guarantors, of the Lenders holding
Tranche A Term Loans differently from those of the Lenders holding
Tranche B Term Loans, without the prior written consent of Lenders
holding in the aggregate at least a majority of the outstanding
principal amount of the Tranche A Term Loans and Lenders holding in
the aggregate at least a majority of the outstanding principal amount
of the Tranche B Term Loans;
(iii) no provision of Article IX may be amended without the
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consent of the Administrative Agent, no provision of Section 2.02 or
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3.04(b)(ii) may be amended without the consent of each Issuing Lender and
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no provision of Section 2.05 may be amended without the consent of the
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Swingline Lender; and
(iv) without the consent of (A) Lenders holding in the aggregate
more than 50% of the Revolving Commitments (or, if the Revolving
Commitments have been terminated, the outstanding Revolving Loans,
Swingline Loans and Participation Interests in Letters of Credit and
Swingline Loans (including the Participation Interests of the Issuing
Lenders in Letters of Credit and the Participation Interests of the
Swingline Lender in the Swingline Loans)) and (B) Lenders holding in the
aggregate more than 50% of the outstanding Tranche A Term Loans and Lenders
holding in the aggregate more than 50% of the outstanding Tranche B Term
Loans, neither this Agreement nor any other Credit Document may be amended
to permit any Debt (including any Obligations attributable to an increase
in the Revolving Commitments or the addition of any Tranche of Debt
hereunder) to be secured by any Collateral pursuant to a Lien of equal
priority to the Lien of the Collateral Agent thereon, except for Permitted
Liens.
Notwithstanding the above, the right to deliver a Payment Blockage
Notice (as defined in the Senior Subordinated Notes), shall reside solely with
the Administrative Agent, and the Administrative Agent shall deliver such
Payment Blockage Notice, only upon the direction of the Required Lenders.
Furthermore, no election by and Lender holding a Tranche B Term Loan to decline
a mandatory prepayment as provided in Section 3.03(b)(vi) shall require the
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consent of any other Person.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (i) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans or the Letters of Credit, and each Lender acknowledges
that the provisions of Section 1126(c) of the Bankruptcy Code supersede the
unanimous consent provisions set forth herein and (ii) the Required Lenders may
consent to allow a Credit Party to use cash collateral in the context of a
bankruptcy or insolvency proceeding.
Notwithstanding the above, each of the Administrative Agent, on the
one hand, and Parent and the Borrower, on the other hand, hereby agree to, and
to cause each of the Subsidiaries of the Borrower, at the request of the
Borrower or the Administrative Agent, as applicable, to enter into one or more
amendments, supplements or other modifications to this Agreement and the other
Credit Documents as the requesting party shall reasonably deem necessary or
desirable to cause each Vessel Mortgage Trustee to be an Eligible Vessel Trustee
(as defined in Section 9.11(c)) and to cause each Vessel Mortgage to comply
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with, and to be for the benefit of a trustee qualified under, all applicable
laws and regulations (including, without limitation, regulations of the
Department of Transportation, Maritime Administration) applicable to such Vessel
Mortgages as the same may from time to time to be in effect and to comply with
such other applicable laws and regulations as are reasonably necessary to allow
the Business to continue without interruption.
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The various requirements of this Section 10.06 are cumulative. Each
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Lender and each holder of a Note shall be bound by any waiver, amendment or
modification authorized by this Section 10.06 regardless of whether its Note
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shall have been marked to make reference therein, and any consent by any Lender
or holder of a Note pursuant to this Section 10.06 shall bind any Person
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subsequently acquiring a Note from it, whether or not such Note shall have been
so marked.
Section 10.07 Counterparts. This Agreement may be executed in any
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number of counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Credit Agreement to produce or
account for more than one such counterpart. Delivery of an executed counterpart
by facsimile shall be effective as an original executed counterpart and shall be
deemed a representation that the original executed counterpart will be
delivered.
Section 10.08 Headings. The headings of the sections and subsections
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hereof are provided for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
Section 10.09 Defaulting Lenders. Each Lender understands and agrees
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that if such Lender is a Defaulting Lender then, notwithstanding the provisions
of Section 10.06, it shall not be entitled to vote on any matter requiring the
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consent of the Required Lenders or to object to any matter requiring the consent
of all the Lenders adversely affected thereby; provided, however, that all other
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benefits and obligations under the Credit Documents shall apply to such
Defaulting Lender.
Section 10.10 Survival of Indemnification and Representations and
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Warranties. All indemnities set forth herein and all representations and
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warranties made herein shall survive the execution and delivery of this Credit
Agreement, the making of the Loans, the issuance of the Letters of Credit and
the repayment of the Loans, LOC Obligations and other obligations and the
termination of the Commitments hereunder.
Section 10.11 Governing Law; Submission to Jurisdiction.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS (OTHER THAN LETTERS
OF CREDIT AND OTHER THAN AS EXPRESSLY SET FORTH IN SUCH OTHER CREDIT DOCUMENTS)
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS
OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500 AND, AS TO MATTERS NOT GOVERNED BY SUCH UNIFORM
CUSTOMS, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. Any legal action or
proceeding with respect to this Agreement or any other Credit Document may be
brought in the courts of the State of New York in New York County, or of the
United States for the Southern District of New York or the Western District of
North Carolina, and, by execution and delivery of this Agreement, each of
Holdings, the Parent and the Borrower hereby irrevocably accepts for itself and
in respect of its property, generally and unconditional, the nonexclusive
jurisdiction of such
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courts. Each of Holdings, the Parent and the Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such court and
any claim that any such proceeding brought in any such court has been brought in
an inconvenient forum.
(b) Each of the Parent and the Borrower hereby irrevocably appoints
C.T. Corporation System its authorized agent to accept and acknowledge service
of any and all process which may be served in any suit, action or proceeding of
the nature referred to in this Section 10.11 and consents to process being
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served in any such suit, action or proceeding upon C.T. Corporation System in
any manner or by the mailing of a copy thereof by registered or certified mail,
postage prepaid, return receipt requested, to the Parent's or the Borrower's
address referred to in Section 10.01, as the case may be. Each of the Parent and
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the Borrowers agrees that such service (i) shall be deemed in every respect
effective service of process upon it in any such suit, action or proceeding and
(ii) shall, to the fullest extent permitted by law, be taken and held to be
valid personal service upon and personal delivery to it. Nothing in this Section
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10.11 shall affect the right of any Lender to serve process in any manner
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permitted by law or limit the right of any Lender to bring proceedings against
the Parent or the Borrower in the courts of any jurisdiction or jurisdictions.
Section 10.12 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS
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AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OF
THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 10.13 Severability. If any provision of the Credit Documents
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is determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
Section 10.14 Entirety. This Agreement together with the other Credit
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Documents represents the entire agreement of the parties hereto and thereto, and
supersedes all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
Section 10.15 Binding Effect. This Agreement shall become effective at
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such time when it shall have been executed by Holdings, the Parent, the
Borrower, and the Agents, the Administrative Agent shall have received copies
hereof (telecopied or otherwise) which, when taken together, bear the signatures
of each Lender, and thereafter this Agreement shall be binding upon and inure to
the benefit of Holdings, the Parent, the Borrower, the Agents and each Lender
and their respective successors and assigns; provided, however, unless the
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conditions set forth in Section 4.01 have been satisfied by the Credit Parties
------------
or waived by the Lenders on or before April 30, 2002 none of Holdings, the
Parent, the Borrower, the Administrative Agent or the Lenders shall have any
obligations under this Agreement.
Section 10.16 Confidentiality. Each Lender agrees that it will use its
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reasonable best efforts to keep confidential any non-public information from
time to time supplied to it under any Credit Document; provided, however, that
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nothing herein shall affect the disclosure of any such information (i) to the
extent such Lender in good faith believes such disclosure is required by
statute, rule, regulation or judicial process, provided that such Lender shall
make reasonable efforts to notify the Borrower of such disclosure prior thereto,
(ii) to counsel for such Lender or to its accountants, (iii) to bank examiners
or auditors or comparable Persons (including, without limitation, the National
Association of Insurance
137
Commissioners), (iv) any Affiliate of such Lender on a confidential basis, (v)
to any direct or indirect contractual counterparty in any Derivatives Agreement
or such contractual counterparty's professional advisor (so long as such
contractual counterparty or professional advisor to such contractual
counterparty agrees to be bound by the provisions of this Section 10.16), (vi)
any other Lender, or assignee, transferee or participant, or any potential
assignee, transferee or participant, of all or any portion of any Lender's
rights under this Agreement who is notified of the confidential nature of the
information and agrees to be bound by this provision or provisions reasonably
comparable hereto or (vii) in connection with any litigation relating to this
Agreement or the other Credit Documents or the enforcement of rights hereunder
to which any one or more of the Lenders is a party; and provided further that no
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Lender shall have any obligation under this Section 10.16 to the extent any such
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information becomes available on a non-confidential basis from a source other
than a Credit Party or its Subsidiaries or that any information becomes publicly
available other than pursuant to a breach of this Section 10.16. Each Lender
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agrees that it will use all confidential information exclusively for the purpose
of evaluating, monitoring, selling, protecting or enforcing its Loans and other
rights under the Credit Documents. Without affecting any other rights of the
Borrower and the other Credit Parties, each Lender acknowledges that the
Borrower shall be entitled to seek the remedies of injunction, specific
performance and other equitable relief for any breach of the provisions of this
Section 10.16.
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Section 10.17 Source of Funds. Each of the Lenders hereby represents
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and warrants to the Borrower that at least one of the following statements is an
accurate representation as to the source of funds to be used by such Lender in
connection with the financing hereunder:
(i) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any employee benefit
plan (or its related trust) has any interest;
(ii) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender, such Lender
has disclosed to the Borrower, at least five Business Days prior to funding
any Loan, the name of each employee benefit plan whose assets in such
account exceed 10% of the total assets of such account as of the date of
such purchase (and, for purposes of this subsection (ii), all employee
---------------
benefit plans maintained by the same employer or employee organization are
deemed to be a single plan);
(iii) to the extent that any part of such funds constitutes
assets of an insurance company's general account, such insurance company
has complied with all of the requirements of the Prohibited Transaction
Class Exemption 95-60 and of regulations issued under Section 401(c)(a)(A)
of ERISA; or
(iv) such funds constitute assets of one or more specific benefit
plans which such Lender has identified in writing to the Borrower, at least
five Business Days prior to funding any Loan.
As used in this Section 10.17, the terms "employee benefit plan" and "separate
-------------
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
Section 10.18 Conflict. To the extent that there is a conflict or
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inconsistency between any provision hereof, on the one hand, and any provision
of any other Credit Document, on the other hand, this Agreement shall control.
[Signature Pages Follow]
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