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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of December 12, 1996
among
BANNER AEROSPACE, INC.
BURBANK AIRCRAFT SUPPLY, INC.
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS LENDERS AND ISSUING BANKS
CITICORP USA, INC.
as Administrative Agent
and Arranger
NATIONSBANK, N.A.
as Co-Arranger
and
NATIONSBANK, N.A.
and
THE LONG-TERM CREDIT BANK OF JAPAN, LTD., CHICAGO BRANCH
as Co-Agents
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ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02. Computation of Time Periods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
1.03. Accounting Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
1.04. Other Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Term Loans; Tranche B Term Loans;
Tranche C Term Loans.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
2.02. Revolving Credit Facility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
2.03. Swing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
2.04. Authorized Officers and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
2.05. Use of Proceeds of Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE III
LETTERS OF CREDIT
3.01. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
3.02. Transitional Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
3.03. Obligations Several. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
3.04. Multicurrency Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
3.05. Nature of Duties; Revolving Lender Indemnification . . . . . . . . . . . . . . . . . . . . . 62
ARTICLE IV
PAYMENTS AND PREPAYMENTS
4.01. Prepayments; Reductions in Commitments. . . . . . . . . . . . . . . . . . . . . . . . . . . 63
4.02. Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
4.03. Promise to Repay; Evidence of Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . 71
4.04. Proceeds of Collateral; Concentration Account
Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
4.05. Cash Collateral Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
4.06. Post-Default Withdrawals from the Concentration
Account and Cash Collateral Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
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ARTICLE V
INTEREST AND FEES
5.01. Interest on the Loans and other Obligations. . . . . . . . . . . . . . . . . . . . . . . . . 76
5.02. Special Provisions Governing Eurodollar Rate Loans . . . . . . . . . . . . . . . . . . . . . 79
5.03. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
5.04. Determination of Applicable Base Rate Margin,
Eurodollar Rate Margin, Tranche C Base Rate
Margin, Tranche C Eurodollar Rate Margin
and Unused Commitment Fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
ARTICLE VI
CONDITIONS TO AGREEMENT'S EFFECTIVENESS,
LOANS AND LETTERS OF CREDIT
6.01. Conditions Precedent to Agreement Becoming Effective. . . . . . . . . . . . . . . . . . . . 85
6.02. Conditions Precedent to All Loans and Letters of
Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
6.03. Conditions Precedent to Tranche C Term Loans. . . . . . . . . . . . . . . . . . . . . . . . 88
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
7.01. Representations and Warranties of the Borrowers . . . . . . . . . . . . . . . . . . . . . . 90
ARTICLE VIII
REPORTING COVENANTS
8.01. Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
8.02. Borrowing Base Certificate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
8.03. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
8.04. Lawsuits and Other Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
8.05. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
8.06. ERISA Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
8.07. Environmental Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
8.08. Other Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
8.09. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
ARTICLE IX
AFFIRMATIVE COVENANTS
9.01. Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
9.02. Corporate Powers; Conduct of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
9.03. Compliance with Laws, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
9.04. Payment of Taxes and Claims; Tax Consolidation. . . . . . . . . . . . . . . . . . . . . . . 110
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9.05. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
9.06. Inspection of Property; Books and Records;
Discussions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
9.07. Required Hedge Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
9.08. Insurance and Condemnation Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
9.09. ERISA Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
9.10. Maintenance of Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
9.11. Condemnation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
9.12. Future Liens on Real Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
9.13. Consignee/Bailee Letters; Leased Inventory;
Filings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
9.14. Maintenance of Tax Sharing Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
9.15. Receivables, Inventory and Fixed Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . 116
9.16. Environmental Compliance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
9.17. Acquisitions of Engines and Airframes; Permitted
Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
ARTICLE X
NEGATIVE COVENANTS
10.01. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
10.02. Sales of Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
10.03. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
10.04. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
10.05. Accommodation Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
10.06. Restricted Junior Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
10.07. Restriction on Operating Leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
10.08. Conduct of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
10.09. Transactions with Shareholders and Affiliates . . . . . . . . . . . . . . . . . . . . . . . 126
10.10. Restriction on Fundamental Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
10.11. Sales and Leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
10.12. Margin Regulations; Securities Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
10.13. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
10.14. Sale of Receivables and Matters Relating to
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
10.15. Organizational Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
10.16. Bank Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
10.17. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
10.18. Issuance and Disposal of Capital Stock. . . . . . . . . . . . . . . . . . . . . . . . . . 129
10.19. Consultant Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
10.20. Payments on Other Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
10.21. Aircraft Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130
10.22. Settlement of Receivables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130
ARTICLE XI
FINANCIAL COVENANTS
11.01. Interest Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
11.02. Fixed Charge Coverage Ratio. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
11.03. Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132
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11.04. Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132
11.05. Capital Expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
11.06. Financial Covenant Calculations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
ARTICLE XII
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
12.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
12.02. Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
ARTICLE XIII
THE ADMINISTRATIVE AGENT AND CO-AGENTS
13.01. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
13.02. Nature of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
13.03. Rights, Exculpation, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
13.04. Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
13.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
13.06. Citicorp Individually. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
13.07. Successor Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
13.08. Relations Among Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
13.09. Concerning the Collateral and the Loan Documents. . . . . . . . . . . . . . . . . . . . . . 146
13.10. Exoneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
ARTICLE XIV
YIELD PROTECTION
14.01. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
14.02. Increased Capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153
14.03. Changes; Legal Restrictions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153
14.04. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
14.05. Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
14.06. Limitation on Additional Amounts Payable by the
Borrowers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
14.07. Change in Lending Office. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
14.08. Replacement of Lender. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
ARTICLE XV
MISCELLANEOUS
15.01. Assignments and Participations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
15.02. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
15.03. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
15.04. Change in Accounting Principles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164
15.05. Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164
15.06. Ratable Sharing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
15.07. Amendments and Waivers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
15.08. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168
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15.09. Survival of Warranties and Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . 168
15.10. Failure or Indulgence Not Waiver; Remedies
Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.11. Marshalling; Payments Set Aside. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.12. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.13. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.14. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.15. Limitation of Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
15.16. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 170
15.17. Certain Consents and Waivers of the Borrowers. . . . . . . . . . . . . . . . . . . . . . . 170
15.18. Counterparts; Effectiveness; Inconsistencies. . . . . . . . . . . . . . . . . . . . . . . 171
15.19. Limitation on Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
15.20. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
15.21. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
15.22. Advice of Counsel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
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SCHEDULES
Schedule 1.01.1 -- Directors
Schedule 1.01.2 -- Intentionally omitted
Schedule 1.01.3 -- Certain Foreign Account Debtors
Schedule 1.01.4 -- Guarantors
Schedule 1.01.5 -- Permitted Acquisitions
Schedule 1.01.6 -- Permitted Equity Securities Options
Schedule 1.01.7 -- Permitted Existing Accommodation
Obligations
Schedule 1.01.8 -- Permitted Existing Indebtedness
Schedule 1.01.9 -- Permitted Existing Investments
Schedule 1.01.10 -- Permitted Existing Liens
Schedule 1.01.11 -- Preferred Stock Terms and Conditions
Schedule 3.02 -- Existing Letters of Credit
Schedule 7.01-A -- Organizational Documents
Schedule 7.01-C -- Organizational Structure
Schedule 7.01-E -- Governmental Consents
Schedule 7.01-K -- Pending Actions
Schedule 7.01-L -- Compensation Matters
Schedule 7.01-S -- Environmental Matters
Schedule 7.01-T -- ERISA Matters
Schedule 7.01-V -- Labor Contracts
Schedule 7.01-Y -- Patent, Trademark & Permit Claims Pending
Schedule 7.01-AA -- Insurance Policies
Schedule 10.09 -- Management Contracts and Service Agreements
Schedule 10.11 -- Permitted Sale/Leaseback Transactions
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Schedule 10.16 -- Collection Accounts
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EXHIBITS
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Borrowing Base Certificate
Exhibit C -- Forms of Collection Account Agreement and
Concentration Account Agreement (C-1 and C-2)
Exhibit D -- ▇▇▇▇▇▇▇▇▇ Subordinated Debt Terms & Conditions
Exhibit E -- Forms of Notes (E-1 and E-2)
Exhibit F -- Form of Notice of Borrowing
Exhibit G -- Form of Notice of Conversion/Continuation
Exhibit H -- Projections
Exhibit I -- Form of Rate Adjustment Financial Reporting
Exhibit J -- List of Closing Documents
Exhibit K -- Form of Officer's Certificate to Accompany Reports
Exhibit L -- Form of Annual Business Plans
Exhibit M -- Form of Consignee/Bailee Letters
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This Second Amended and Restated Credit Agreement dated as of
December 12, 1996 (as amended, supplemented or modified from time to time, the
"Agreement") is entered into among Banner Aerospace, Inc., a Delaware
corporation ("Banner"), Burbank Aircraft Supply, Inc., a Delaware corporation
("Burbank") (Banner and Burbank being collectively referred to as "Borrowers"),
institutions from time to time a party hereto as Lenders and Issuing Banks,
whether by execution of this Agreement or an Assignment and Acceptance,
Citicorp USA, Inc., a Delaware corporation ("Citicorp"), in its capacity as
administrative agent for the Lenders and the Issuing Banks hereunder (in such
capacity, the "Administrative Agent"), and NationsBank, N.A. and The Long-Term
Credit Bank of Japan, Ltd., Chicago Branch, in their capacity as co-agents for
the Lenders and Issuing Banks hereunder (in such capacity, individually, a
"Co-Agent", and, collectively, the "Co-Agents").
WITNESSETH:
WHEREAS, Borrowers have requested additional financial
accommodations under that certain Amended and Restated Credit Agreement dated
as of July 1, 1996 and the amendment of certain covenants contained therein;
and
WHEREAS, the Lenders have agreed to amend and restate the
aforesaid Amended and Restated Credit Agreement to provide for the making of
the requested additional financial accommodations and the modification of
certain covenants and other terms thereof, in each instance on the terms and
conditions set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms. The following terms used in
this Agreement shall have the following meanings, applicable both to the
singular and the plural forms of the terms defined:
"Accommodation Obligation" means any Contractual Obligation,
contingent or otherwise, of one Person with respect to any Indebtedness,
obligation or liability of another, if the primary purpose or intent thereof by
the Person incurring the Accommodation Obligation is to provide assurance to
the obligee
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of such Indebtedness, obligation or liability of another that such
Indebtedness, obligation or liability will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders thereof
will be protected (in whole or in part) against loss in respect thereof
including, without limitation, direct and indirect guarantees, endorsements
(except for collection or deposit in the ordinary course of business), notes
co-made or discounted, recourse agreements, take-or- pay agreements, keep-well
agreements, agreements to purchase or repurchase such Indebtedness, obligation
or liability or any security therefor or to provide funds for the payment or
discharge thereof, agreements to maintain solvency, assets, level of income,
or other financial condition, and agreements to make payment other than for
value received. The amount of any Accommodation Obligation shall be equal to
the amount of the Indebtedness, obligation or liability so guaranteed or
otherwise supported; provided, that (i) if the liability of the Person
extending such guaranty or support is limited with respect thereto to an amount
less than the Indebtedness, obligation or liability guaranteed or supported, or
is limited to recourse against a particular asset or assets of such Person, the
amount of the corresponding Accommodation Obligation shall be limited (in the
case of a guaranty or other support limited by amount) to such lesser amount or
(in the case of a guaranty or other support limited by recourse to a particular
asset or assets) to the higher of the Fair Market Value of such asset or assets
at the date for determination of the amount of the Accommodation Obligation or
the value at which such asset or assets would, in con formity with GAAP, be
reflected on or valued for the purposes of preparing a consolidated balance
sheet of such Person as at such determination date; and (ii) if any obligation
or liability is guaranteed or otherwise supported jointly and severally by a
Person and others, then the amount of the obligation or liability of such
Person with respect to such guaranty or other support to be included in the
amount of such Person's Accommodation Obligation shall be the whole principal
amount so guaranteed or otherwise supported.
"Administrative Agent" means Citicorp and each successor
administrative agent appointed pursuant to the terms of Article XIII of this
Agreement.
"Affiliate", as applied to any Person, means any other Person
that directly or indirectly controls, is controlled by, or is under common
control with, that Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to vote twenty percent (20.0%)
or more of the Securities having voting power for the election of directors of
such Person or otherwise to direct or cause the direction of the management and
policies of that Person, whether
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through the ownership of voting Securities or by contract or otherwise.
"Agreement" is defined in the preamble hereto.
"Airbus Inventory" means Inventory consisting of fasteners
acquired by Burbank from AVSA S.A.R.L., a Wholly-Owned Subsidiary of Airbus
Industrie, G.I.E., France under a purchase contract satisfactory in form and
substance to the Administrative Agent, which Inventory is located in the
Republic of Germany.
"Aircraft" is defined in the Aircraft Mortgage.
"Aircraft Mortgage" means an Aircraft Collateral Trust
Agreement and Mortgage in the form of those dated as of August 2, 1995 executed
by D A C International, Inc., Dallas Aerospace, Inc., Solair, Inc., and
Georgetown Jet Center, Inc., as the same may be amended, supplemented, modified
or reaffirmed from time to time.
"Airframe" is defined in the Aircraft Mortgage.
"Applicable Lending Office" means, with respect to a
particular Lender, its Eurodollar Lending Office in respect of provisions
relating to Eurodollar Rate Loans and its Domestic Lending Office in respect of
provisions relating to Base Rate Loans.
"Assignment and Acceptance" means an Assignment and Acceptance
in substantially the form of Exhibit A attached hereto and made a part hereof
(with blanks appropriately completed) delivered to the Administrative Agent in
connection with an assignment of a Lender's interest under this Agreement in
accordance with the provisions of Section 15.01.
"Bankruptcy Code" means Title 11 of the United States Code (11
U.S.C. Sections 101 et seq.), as amended from time to time, and any successor
statute.
"Base Eurodollar Rate" means, with respect to any Eurodollar
Interest Period applicable to a Borrowing of Eurodollar Rate Loans, an interest
rate per annum determined by the Administrative Agent to be the average
(rounded upward to the nearest whole multiple of one sixteenth of one percent
(0.0625%) per annum if such average is not such a multiple) of the rates per
annum specified by notice to the Administrative Agent by each of the Reference
Banks as the rate per annum at which deposits in Dollars are offered by the
principal office of such Reference Bank in London, England to major banks in
the London interbank market at approximately 11:00 a.m. (London time) on the
Eurodollar Interest Rate Determination Date for such Eurodollar
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Interest Period for a period equal to such Eurodollar Interest Period and in an
amount substantially equal to the amount of the Eurodollar Rate Loan to be
outstanding to such Reference Bank or Citicorp, as applicable, for such
Eurodollar Interest Period.
"Base Rate" means, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time, which rate per annum shall
at all times be equal to the highest of:
(i) the rate of interest announced publicly by Citibank
in New York, New York from time to time, as Citibank's base rate; and
(ii) the sum of (A) one-half of one percent (0.50%) per
annum plus (B) the Federal Funds Rate in effect from time to time
during such period.
"Base Rate Loans" means all Loans which bear interest at a
rate determined by reference to the Base Rate as provided in Section 5.01(a).
"Base Rate Margin" means, as of any date of determination, a
per annum rate equal to the rate set forth below opposite the then applicable
Performance Level set forth below:
Applicable
Performance Level Base Rate Margin
----------------- ----------------
▇▇▇▇▇ ▇ 0.25%
▇▇▇▇▇ ▇ 0.50%
▇▇▇▇▇ ▇ 0.75%
▇▇▇▇▇ ▇ 1.00%
▇▇▇▇▇ ▇ 1.25%
▇▇▇▇▇ ▇ 1.50%
provided, however, that, during the period commencing on August 2, 2000 and
ending on August 1, 2001, the rates set forth under the heading Applicable Base
Rate Margin above shall be increased by 0.25%.
"Benefit Plan" means a defined benefit plan as defined in
Section 3(35) of ERISA (other than a Multiemployer Plan or Foreign Employee
Benefit Plan) in respect of which either Borrower or any ERISA Affiliate is, or
within the immediately preceding five (5) years was, an "employer" as defined
in Section 3(5) of ERISA.
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"Borrowers" is defined in the preamble of this Agreement.
"Borrowing" means a borrowing consisting of Loans of the same
type made, continued or converted on the same day.
"Borrowing Base" means, as of any date of determination, an
amount (designated as such on the Borrowing Base Certificate dated as of such
date of determination) equal to the sum of (i) eighty percent (80%) of the face
amount of Eligible Receivables, plus (ii) fifty percent (50%) of (a) the Total
Book Value of Inventory (other than the Airbus Inventory if the same is subject
to a Lien granted to or in favor of, or retention of title by, any Person other
than the Administrative Agent) minus (b) the Texas Tax Reserve.
"Borrowing Base Certificate" means a certificate, in
substantially the form of EXHIBIT B attached hereto and made a part hereof,
setting forth for determination of the Borrowing Base the value of Eligible
Receivables, the Total Book Value of Inventory, the respective advance
percentages with respect thereto, and the resultant Borrowing Base, in each
instance, as of the date of such certificate.
"Business Activity Report" means (i) a Notice of Business
Activities Report from the State of New Jersey Division of Taxation or (ii) a
Minnesota Business Activity Report from the Minnesota Department of Revenue.
"Business Day" means a day, in the applicable local time,
which is not a Saturday or Sunday or a legal holiday and on which banks are not
required or permitted by law or other govern mental action to close (i) in New
York, New York or Chicago, Illinois and (ii) in the case of Eurodollar Rate
Loans, in London, England and (iii) in the case of Letter of Credit
transactions for an Issuing Bank, in the place where its office for issuance or
administration of the pertinent Letter of Credit is located.
"Canadian Subsidiary" means a Wholly-Owned Subsidiary of
Banner to be formed under the laws of a state of the United States, Canada or
the Province of Quebec for the primary purpose of leasing and operating a
warehouse facility in the Province of Quebec, Canada for purposes similar to
those of the other Foreign Facilities.
"Capital Expenditures" means, for any period, the aggregate of
all expenditures (whether payable in cash or other Property or accrued as a
liability (but without duplication)) during such period that, in conformity
with GAAP, are required to be included in or reflected by fixed asset accounts
as reflected in the consolidated balance sheet of Banner and its Subsidiaries;
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provided, however, (i) Capital Expenditures shall include, whether or not such
a designation would be in conformity with GAAP, (a) that portion of Capital
Leases which is capitalized on the consolidated balance sheet of Banner and its
Subsidiaries and (b) expenditures for Equipment which is purchased
simultaneously with the trade-in of existing Equipment owned by either Borrower
or any Subsidiary of either Borrower, to the extent the gross purchase price of
the purchased Equipment exceeds the book value of the Equipment being traded in
at such time; and (ii) Capital Expenditures shall exclude, whether or not such
a designation would be in conformity with GAAP, expenditures made in connection
with (a) the Utah Distribution Center during the Fiscal Year ending March 31,
1995, and (b) the replacement or restoration of Property, to the extent
reimbursed or financed from insurance or condemnation proceeds not constituting
Net Cash Proceeds of Sale.
"Capital Lease" means any lease of any property (whether real,
personal or mixed) by a Person as lessee which, in conformity with GAAP, is
accounted for as a capital lease on the balance sheet of that Person.
"Capital Stock" means, with respect to any Person, any capital
stock of such Person, regardless of class or designation, and all warrants,
options, purchase rights, conversion or exchange rights, voting rights, calls
or claims of any character with respect thereto.
"Cash Collateral" means cash or Cash Equivalents held by the
Administrative Agent, any Co-Agent, an Issuing Bank or any Lender as security
for the Obligations.
"Cash Collateral Account" means an interest bearing account at
Citibank's offices in New York, New York designated by the Administrative Agent
into which Cash Collateral shall be deposited. The Cash Collateral Account
shall be under the sole dominion and control of the Administrative Agent,
provided that all amounts deposited therein shall be held by the Administrative
Agent for the benefit of the Holders and shall be subject to the terms of
Sections 4.05 and 4.06.
"Cash Equivalents" means (i) marketable direct obligations
issued or unconditionally guaranteed by the United States government or issued
by an agency thereof and backed by the full faith and credit of the United
States government; (ii) marketable direct obligations issued by any state of
the United States of America or any political subdivision of any such state or
any public instrumentality thereof; (iii) commercial paper, and (iv) domestic
and Eurodollar certificates of deposit or bankers' acceptances issued by any
Lender or issued by any commercial bank organized under the laws of the United
States of America, any state thereof, or the District of Columbia; which, (a)
in each instance described in clauses (i), (ii) and (iii)
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above, at the time of acquisition or creation, are rated A-1 (or better) by
Standard & Poor's Corporation or P-1 (or better) by ▇▇▇▇▇'▇ Investors Services,
Inc. (or, if at any time neither Standard & Poor's Corporation nor ▇▇▇▇▇'▇
Investors Service, Inc. shall be rating such obligations, then the highest
rating from such other nationally recognized rating services as are reasonably
acceptable to the Administrative Agent) and (b) in the instance described in
clause (iv) above, have the highest deposit rating category as published by
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ (or any successor thereto); provided, that the
maturities of such Cash Equivalents shall not exceed ninety (90) days after the
date of acquisition thereof.
"Cash Interest Expense" means, for any period, total interest
expense, whether paid or accrued, but without duplication, (including the
interest component of Capital Leases) of Banner and its Subsidiaries, which is
payable in cash, all as determined in conformity with GAAP.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601 et seq., any
amendments thereto, any successor statutes, and any regulations promulgated
thereunder.
"Change of Control" means (i) more than fifty percent (50%) of
the directors of Banner shall not be the directors of Banner identified on
SCHEDULE 1.01.1 and (ii) on and as of the date when the event described in
clause (i) occurs, any Person (other than members of the ▇▇▇▇▇▇▇▇▇ Group) shall
own, directly or indirectly and beneficially, Voting Stock of Banner equal to
or greater than twenty-five percent (25%) of the outstanding Voting Stock of
Banner, which percentage of the outstanding Voting Stock of Banner owned by
such Person is greater than the percentage of outstanding Voting Stock of
Banner held by the ▇▇▇▇▇▇▇▇▇ Group; provided, however, that (1) the provisions
of clause (i) shall not pertain to directors listed on SCHEDULE 1.01.1 who die
or become disabled (physically or mentally) and are replaced with new directors
by a vote of Persons then serving as directors, but shall apply to such
replacement directors; and (2) the members of the ▇▇▇▇▇▇▇▇▇ Group may pledge or
place in trust or escrow the Voting Stock of Banner held by them provided that
no voting rights with respect thereto transfer to any other Person.
"Citibank" means Citibank, N.A., a national banking
association.
"Citicorp" is defined in the preamble of this Agreement.
"Claim" means any claim or demand, by any Person, of
whatsoever kind or nature for any alleged Liabilities and Costs,
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whether based in contract, tort, implied or express warranty, strict liability,
criminal or civil statute, Permit, ordinance or regulation, common law or
otherwise.
"Closing Date" means August 2, 1995.
"Co-Agent" means each of, NationsBank and LTCB and each
successor co-agent appointed pursuant to the terms of Article XIII of this
Agreement; and "Co-Agents" means, collectively, all of the "Co-Agents".
"Collateral" means all Property and interests in Property now
owned or hereafter acquired by either Borrower or any Subsidiary of either
Borrower upon which a Lien is granted under any of the Loan Documents.
"Collection Account" means each lock-box and blocked
depository account maintained by the Borrowers and/or any Subsidiary of the
Borrowers subject to a Collection Account Agreement for the collection of
Receivables and other proceeds of Collateral.
"Collection Account Agreement" means a written agreement,
substantially in the form attached hereto as EXHIBIT C-1 with such
modifications as the Administrative Agent, from time to time, deems acceptable,
among the Borrowers and/or a Subsidiary of the Borrowers, the Administrative
Agent, and, as applicable, each of the banks at which either Borrower or a
Subsidiary of either Borrower maintains a Collection Account.
"Commercial Letter of Credit" means any documentary letter of
credit issued by an Issuing Bank pursuant to Section 3.01 for the account of
either Borrower or for the account of any of either Borrower's Subsidiaries if
the Borrowers are jointly and severally liable for reimbursement of amounts
drawn under such letter of credit, which is drawable upon presentation of
documents evidencing the sale or shipment of goods purchased by a Borrower or
such Subsidiary in the ordinary course of its business.
"Commission" means the Securities and Exchange Commission and
any Person succeeding to the functions thereof.
"Commitment" means, with respect to any Lender at the time of
determination thereof, the aggregate amount of such Lender's Revolving Credit
Commitment and Term Loan Commitment and "Commitments" means the aggregate
amount of all Term Loan Commitments and Revolving Credit Commitments.
"Compliance Certificate" is defined in Section 8.01(d).
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18
"Concentration Account" means the depository account of Banner
maintained at Citibank in New York, New York, or such other financial
institution designated for such purpose by the Administrative Agent into which
collections of Receivables, other proceeds of Collateral and other amounts are
transferred pursuant to the terms of the Collection Account Agreements or
otherwise as described in Section 4.04.
"Concentration Account Agreement" means a written agreement,
substantially in the form attached hereto as EXHIBIT C-2 with such
modifications as the Administrative Agent, from time to time, deems acceptable,
among Banner, the Administrative Agent, and Citibank.
"Consolidated Rental Payments" means the aggregate amount of
all rents paid, or accrued, of the Borrowers and their Subsidiaries under all
Operating Leases with respect to which such Person is a lessee as determined on
a consolidated basis in conformity with GAAP.
"Contaminant" means any waste, pollutant, hazardous substance,
toxic substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, or any constituent of any such substance or waste that,
itself, is a "Contaminant", and includes, but is not limited to, these terms as
defined in federal, state or local laws or regulations.
"Contractual Obligation", as applied to any Person, means any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, security agreement, pledge agreement, guaranty, contract,
undertaking, agreement or instrument imposing legal obligations on such Person
and to which that Person is a party or by which it or any of its properties is
bound, or to which it or any of its properties is subject.
"Cure Loans" is defined in Section 4.02(b)(v)(C).
"Customary Permitted Liens" means
(i) Liens (other than Environmental Liens and Liens in favor
of the PBGC) with respect to the payment of taxes, assessments or
governmental charges in all cases (a) which are not yet due, (b) which
are being contested in good faith by appropriate proceedings, or (c)
which may be paid in arrears with no interest or penalty charges and
(d) with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with GAAP;
(ii) statutory Liens of landlords and Liens of suppliers,
mechanics, carriers, materialmen, warehousemen or workmen and other
Liens imposed by law
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created in the ordinary course of business for amounts not yet due or
which are being contested in good faith by appropriate proceedings and
with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with GAAP;
(iii) Liens (other than any Lien in favor of the PBGC)
incurred or deposits made in the ordinary course of business in
connection with worker's compensation, unemployment insurance or other
types of social security benefits or to secure the performance of
bids, tenders, sales, leases, contracts (other than for the repayment
of borrowed money), surety, appeal and performance bonds, statutory
obligations and other similar obligations or arising as a result of
progress payments under government contracts; and
(iv) Liens arising with respect to zoning restrictions,
easements, licenses, reservations, covenants, rights-of-way, utility
easements, building restrictions and other similar charges or
encumbrances on the use of Real Property which do not interfere with
the ordinary conduct of the business of either Borrower or any of
their Subsidiaries.
"Designated Prepayment" means each mandatory prepayment
required by clauses (i), (ii), and (iii) of Section 4.01(b).
"DOL" means the United States Department of Labor and any
Person succeeding to the functions thereof.
"Dollars" and "$" mean the lawful money of the United States
of America.
"Domestic Lending Office" means, with respect to any Lender,
such Lender's office, located in the United States, specified as the "Domestic
Lending Office" under its name on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or such other United
States office of such Lender as it may from time to time specify by written
notice to the Borrowers and the Administrative Agent.
"EBITDA" means, for any period, the amount calculated, without
duplication, for such period as (i) Net Income, plus (ii) depreciation and
amortization expense, plus (iii) Total Interest Expense, plus (iv) federal,
state, and local income taxes deducted from Net Income in accordance with GAAP,
plus (v) non-cash reserves during such period related to the scrapping of
Inventory, plus (vi) if such period occurs in the Fiscal Year ending March 31,
1996 or the Fiscal Year ending March 31, 1997, all one-time and transitional
charges relating to the relocation of ▇▇▇▇▇ Industries, Inc., Aircraft Bearing
Corporation,
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Aerospace Bearing Support, Inc., and Burbank, which charges are recorded in the
Financial Statements delivered to the Administrative Agent as required by
Section 8.01(b) and Section 8.01(c) and, for purposes of this calculation,
shall not exceed $3,000,000 in the aggregate, plus (vii) if such period occurs
in the Fiscal Year ended March 31, 1995, all non-cash charges and provisions
for future losses on the sale of Inventory (write- downs) recorded in the
audited Financial Statements delivered to the Administrative Agent as required
by Section 8.01(c) for such Fiscal Year, which charges, for purposes of this
calculation, shall not exceed $13,750,000 in the aggregate.
"Effective Date" is defined in Section 6.01.
"Eligible Assignee" means (i) a Lender or any Affiliate
thereof; (ii) a commercial bank having total assets in excess of
$1,000,000,000; (iii) the central bank of any country which is a member of the
Organization for Economic Cooperation and Development; or (iv) a finance
company, insurance company, other financial institution or fund, acceptable to
the Administrative Agent, which is regularly engaged in making, purchasing or
investing in loans and having total assets in excess of $300,000,000.
"Eligible Receivables" means each Receivable of either
Borrower or a Subsidiary of either Borrower which, when scheduled to the
Administrative Agent and at all times thereafter, is not of any of the
following types:
(i) it is due or unpaid more than ninety (90) days after the
date of the original invoice issued by a Borrower or such Subsidiary
with respect to the sale giving rise thereto; or
(ii) it arises out of a sale not made in the ordinary course
of such Borrower's or such Subsidiary's business or a sale to a Person
which is an Affiliate of the Borrowers or controlled by an Affiliate
of the Borrowers; provided, however, that the "▇▇▇▇▇▇▇▇▇ Fasteners
Division" of VSI Corporation shall not be deemed an Affiliate of the
Borrowers for purposes of the foregoing; or
(iii) it fails to meet or violates any warranty,
representation or covenant contained in this Agreement or any of the
other Loan Documents relating directly or indirectly to the
Receivables of such Borrower or such Subsidiary; or
(iv) the account debtor (a) is also such Borrower's or such
Subsidiary's supplier or creditor and the Receivable is or may become
subject to any
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right of setoff by the account debtor, and such account debtor has not
entered into an agreement with the Administrative Agent with respect
to the waiver of rights of setoff which is in form and substance
satisfactory to the Administrative Agent; or (b) the account debtor
has disputed liability with respect to such Receivable, or made any
claim with respect to any other Receivable due from such account
debtor to such Borrower, in which cases the Receivable shall be
ineligible to the extent of (I) such setoff with respect to which an
agreement as described in clause (a) above is not in effect, (II) such
dispute, or (III) such claim; or
(v) the account debtor has filed a petition for bankruptcy or
any other petition for relief under the Bankruptcy Code or any similar
statute (unless the account debtor is a debtor-in-possession in a
Chapter 11 case and has available debtor-in-possession financing from
sources and under terms reasonably acceptable to the Administrative
Agent and the Receivable is entitled to priority under Section 507 of
the Bankruptcy Code as an administrative expense allowed under Section
503(b) of the Bankruptcy Code), made an assignment for the benefit of
creditors, or if any petition or other application for relief under
the Bankruptcy Code or any similar statute has been filed against the
account debtor, or if the account debtor has failed, suspended its
business operations, become insolvent, suffered a receiver or a
trustee to be appointed for any of its assets or affairs, or is
generally failing to pay its debts as they become due; or
(vi) the sale is to an account debtor outside the United
States or Canada, unless (a) the account debtor's obligations (or that
portion of such obligations which is acceptable to the Administrative
Agent) with respect to such sale is secured by a letter of credit,
guaranty or eligible bankers' acceptance having terms, and from such
issuers and confirmation banks, as are acceptable to the
Administrative Agent or (b) such account debtor (or potential account
debtor) is identified on SCHEDULE 1.01.3 or otherwise reasonably
acceptable to the Administrative Agent as confirmed to the Borrowers
in writing; or
(vii) the sale is on a ▇▇▇▇-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment, or any other
repurchase or return basis; or
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(viii) the Administrative Agent believes, in the exercise of
its reasonable credit judgment, or the Requisite Revolving Lenders
believe, in the exercise of their reasonable credit judgment, that
collection of such Receivable is insecure or that such Receivable may
not be paid by reason of the account debtor's financial inability to
pay; or
(ix) the account debtor is the United States of America or
any department, agency or instrumentality thereof, unless (a) the
applicable Borrower or the applicable Subsidiary assigns its right to
payment of such Receivable to the Administrative Agent pursuant to the
Assignment of Claims Act of 1940, as amended, (31 U.S.C. Section
3727) or (b) the aggregate Receivables owing by such account debtors
does not exceed $500,000; provided, however, that in the event
aggregate Receivables owing by such account debtors exceed $500,000,
the amount of such Receivables in excess of $500,000 shall be
ineligible unless the provisions of clause (ix)(a) are complied with;
or
(x) the goods, the sale of which has given rise to such
Receivable, have not been shipped and delivered to and accepted by the
account debtor (unless such goods retained by the applicable Borrower
or the applicable Subsidiary are identifiable as being the subject of
such sale and are segregated from other goods in such Person's
possession), or the services, the performance of which has given rise
to such Receivable, have not been performed by such Borrower or
Subsidiary and accepted by the account debtor; or
(xi) the Receivable(s) of the respective account debtor
exceed(s) a credit limit determined by the Administrative Agent, in
the exercise of its reasonable credit judgment, or determined by the
Requisite Revolving Lenders, in the exercise of their reasonable
credit judgment, at any time or times hereafter, in which case such
Receivable(s) shall be ineligible to the extent such Receivable(s)
exceed(s) such limit; or
(xii) the Administrative Agent does not have a senior,
perfected security interest in such Receivable or such Receivable is
subject to a Lien which is not permitted under Section 10.03; or
(xiii) the account debtor is located in the state of New
Jersey or Minnesota and such Borrower or Subsidiary has not filed and
maintained effective (unless exempt from the requirements for filing)
a current Business Activity Report with the appropriate
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Governmental Authority in the states of Minnesota and/or New Jersey,
as applicable.
"Engine" is defined in the Aircraft Mortgage.
"Environmental, Health or Safety Requirements of Law" means
all Requirements of Law derived from or relating to any federal, state or local
law, ordinance, rule, regulation, Permit, license or other binding
determination of any Governmental Authority relating to, imposing liability or
standards concerning, or otherwise addressing, the environment, health and/or
safety, including, but not limited to the Clean Air Act, the Clean Water Act,
CERCLA, RCRA, any so-called "Superfund" or "Superlien" law, the Toxic
Substances Control Act and OSHA, and public health codes, each as from time to
time in effect.
"Environmental Lien" means a Lien in favor of any Governmental
Authority for any (i) liabilities under any Environmental, Health or Safety
Requirement of Law, or (ii) damages arising from, or costs incurred by such
Governmental Authority in response to, a Release or threatened Release of a
Contaminant into the environment.
"Environmental Property Transfer Acts" means any applicable
Requirement of Law that conditions, restricts, prohibits or requires any
notification or disclosure triggered by the transfer, sale, lease or closure of
any Property or deed or title for any Property for environmental reasons,
including, but not limited to, any so-called "Industrial Site Recovery Acts" or
"Responsible Property Transfer Acts".
"Equipment" means, with respect to any Person, all of such
Person's present and future (i) equipment, including, without limitation,
machinery, manufacturing, distribution, selling, data processing and office
equipment, assembly systems, tools, molds, dies, fixtures, appliances,
furniture, furnishings, vehicles, vessels, aircraft, aircraft engines, and
trade fixtures, (ii) other tangible personal property (other than such Person's
Inventory), and (iii) any and all accessions, parts and appurtenances attached
to any of the foregoing or used in connection therewith, and any substitutions
therefor and replacements, products and proceeds thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, 29 U.S.C. Sections 1000 et seq., any amendments thereto, any successor
statutes, and any regulations or guidance promulgated thereunder.
"ERISA Affiliate" means (i) any corporation which is a member
of the same controlled group of corporations (within the meaning of Section
414(b) of the Internal Revenue Code) as the Borrowers; (ii) a partnership or
other trade or business (whether
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or not incorporated) which is under common control (within the meaning of
Section 414(c) of the Internal Revenue Code) with the Borrowers; and (iii) a
member of the same affiliated service group (within the meaning of Section
414(m) of the Internal Revenue Code) as the Borrowers, any corporation
described in clause (i) above or any partnership or trade or business described
in clause (ii) above.
"Eurodollar Affiliate" means, with respect to each Lender, the
Affiliate of such Lender (if any) set forth below such Lender's name under the
heading "Eurodollar Affiliate" on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or such Affiliate of a
Lender as it may from time to time specify by written notice to the Borrowers
and the Administrative Agent.
"Eurodollar Interest Payment Date" means (i) with respect to
any Eurodollar Rate Loan, the last day of each Eurodollar Interest Period
applicable to such Loan and (ii) with respect to any Eurodollar Rate Loan
having a Eurodollar Interest Period in excess of three (3) calendar months, the
last day of each three (3) calendar month interval during such Eurodollar
Interest Period.
"Eurodollar Interest Period" is defined in Section 5.02(b).
"Eurodollar Interest Rate Determination Date" is defined in
Section 5.02(c).
"Eurodollar Lending Office" means, with respect to any Lender,
the office or offices of such Lender (if any) set forth below such Lender's
name under the heading "Eurodollar Lending Office" on the signature pages
hereof or on the Assignment and Acceptance by which it became a Lender or such
office or offices of such Lender as it may from time to time specify by written
notice to the Borrowers and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Eurodollar
Interest Period applicable to a Eurodollar Rate Loan, an interest rate per
annum obtained by dividing (i) the Base Eurodollar Rate applicable to that
Eurodollar Interest Period by (ii) a percentage equal to 100% minus the
Eurodollar Reserve Percentage in effect on the relevant Eurodollar Interest
Rate Determination Date.
"Eurodollar Rate Loans" means those Loans outstanding which
bear interest at a rate determined by reference to the Eurodollar Rate and the
Eurodollar Rate Margin as provided in Section 5.01(a).
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"Eurodollar Rate Margin" means, as of any date of
determination, a per annum rate equal to the rate set forth below opposite the
then applicable Performance Level set forth below:
Applicable
Performance Level Eurodollar Rate Margin
----------------- ----------------------
▇▇▇▇▇ ▇ 1.50%
▇▇▇▇▇ ▇ 1.75%
▇▇▇▇▇ ▇ 2.00%
▇▇▇▇▇ ▇ 2.25%
▇▇▇▇▇ ▇ 2.50%
▇▇▇▇▇ ▇ 2.75%
provided, however, that during the period commencing on August 2, 2000 and
ending on August 1, 2001, the rates set forth under the heading Applicable
Eurodollar Rate Margin above shall be increased by 0.25%.
"Eurodollar Reserve Percentage" means, for any day, that
percentage which is in effect on such day, as prescribed by the Federal Reserve
Board for determining the maximum reserve requirement (including, without
limitation, any emergency, supplemental or other marginal reserve requirement)
for a member bank of the Federal Reserve System in New York, New York with
deposits exceeding Five Billion Dollars ($5,000,000,000) 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
Rate Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any bank to United
States residents).
"Event of Default" means any of the occurrences set forth in
Section 12.01 after the expiration of any applicable grace period, as expressly
provided in Section 12.01.
"Excess Cash Flow" means, with respect to Banner, on a
consolidated basis, for each Fiscal Year, an amount equal to the greater of (i)
zero and (ii) the sum of Banner's (a) Net Income for such Fiscal Year; plus (b)
consolidated federal, state and local income tax expense for such Fiscal Year,
whether to be paid by Banner directly or to a Person other than a Borrower or
any Subsidiary of a Borrower pursuant to any tax indemnity, tax sharing or tax
allocation agreement; plus (c) Total Interest Expense for such Fiscal Year;
plus (d) consolidated depreciation and amortization for such Fiscal Year, plus
(e) other non-cash
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26
charges included in the determination of such Net Income (including, without
limitation, inventory reserves and restructuring reserves) for such Fiscal
Year; minus Banner's (1) non-cash credits to Net Income for such Fiscal Year;
minus (2) Cash Interest Expense for such Fiscal Year; minus (3) capitalized
financing fees paid in such Fiscal Year; minus (or plus) (4) federal, state and
local cash income tax payments made (or received) during such Fiscal Year by
Banner and its Subsidiaries, whether made (or received) by such Person directly
or pursuant to a tax indemnity, tax sharing or tax allocation agreement to (or
from) a Person other than a Borrower or any Subsidiary of a Borrower; minus (5)
Capital Expenditures for such Fiscal Year; minus (6) scheduled principal
payments due and made and voluntary prepayments made with respect to the Term
Loans and Tranche B Term Loans and scheduled principal payments on Indebtedness
of Banner and its Subsidiaries permitted under Contractual Obligations
governing the incurrence and payment thereof and made in such Fiscal Year;
minus (7) the net increase, if any, in Working Capital for such Fiscal Year;
plus (8) the net decrease, if any, in Working Capital for such Fiscal Year. The
foregoing amounts, whether individually or collectively, shall be adjusted to
the extent required to avoid duplication of any item; Excess Cash Flow shall
not include Net Cash Proceeds of Sale; and Excess Cash Flow shall be calculated
for each Fiscal Year commencing with the Fiscal Year ending on March 31, 1997.
"Excess Cash Flow Basket" means an amount equal to (i)
$2,500,000 for the Fiscal Year ending March 31, 1997 and (ii) the sum of(a)
$2,500,000 plus (b) $2,500,000 per year for each of the Fiscal Years ending in
1998 and thereafter.
"Fair Market Value" means, with respect to any asset, the
value of the consideration obtainable in a sale of such asset in the open
market, assuming a sale by a willing seller to a willing purchaser dealing at
arm's length and arranged in an orderly manner over a reasonable period of
time, each having reasonable knowledge of the nature and characteristics of
such asset, neither being under any compulsion to act, and, if in excess of
$250,000, as determined (a) in good faith by the Board of Directors of the
applicable Borrower or Subsidiary or (b) in an appraisal of such asset,
provided that for purposes of Section 10.02 such appraisal was performed within
the one-year period immediately preceding the date of such sale by an
independent third party appraiser and the basic assumptions underlying such
appraisal have not materially changed since the date thereof.
"▇▇▇▇▇▇▇▇▇" means The ▇▇▇▇▇▇▇▇▇ Corporation, a Delaware
corporation.
"▇▇▇▇▇▇▇▇▇ Group" means, collectively, ▇▇▇▇▇▇▇▇▇, Subsidiaries
of ▇▇▇▇▇▇▇▇▇ one hundred percent (100%) of the Voting Stock of which is owned
directly or indirectly and
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beneficially by ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, and "associates" (as defined in
the Securities Exchange Act) of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
"Fairchild Subordinated Debt" means unsecured subordinated
Indebtedness of Banner issued to RHI in a principal amount not to exceed
$30,000,000 plus deferred interest and fees pursuant to a certain Subordinated
Loan Agreement to be entered into between Banner and RHI in form and substance
satisfactory to the Administrative Agent and including, without limitation,
terms and conditions set forth in EXHIBIT D attached hereto and made a part
hereof, the proceeds of which are used to consummate the Permitted Acquisitions
and provide working capital for the Persons making such acquisitions or
acquired in such acquisitions.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds brokers, as published for
such day (or, if such day is not a Business Day in New York, New York, for the
next preceding Business Day) in New York, New York by the Federal Reserve Bank
of New York, or if such rate is not so published for any day which is a
Business Day in New York, New York, the average of the quotations for such day
on such transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any Governmental Authority succeeding to its
functions.
"Financial Statements" means (i) statements of income and
retained earnings, statements of cash flow, and balance sheets, (ii) such other
financial statements as Banner and its Subsidiaries shall routinely and
regularly prepare and (iii) such other financial statements as the
Administrative Agent or the Requisite Lenders may from time to time reasonably
specify.
"Fiscal Year" means the fiscal year of Banner and its
Subsidiaries for accounting and tax purposes, which shall be the 12-month
period ending on March 31 of each calendar year or such other period as
Borrowers may designate and the Administrative Agent may approve in writing.
"Fixed Charge Coverage Ratio" means, for any period, the ratio
of (a) the amount calculated as (i) EBITDA minus (ii) all income taxes paid in
cash during such period minus (iii) the aggregate amount of Capital
Expenditures made in cash during such period plus (iv) the aggregate amount of
Permitted Lease Payments
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made in cash during such period to (b) the sum of (i) Cash Interest Expense
plus (ii) the aggregate amount of scheduled payments of principal of Funded
Debt during such period plus (iii) the amount of dividends declared and paid by
Banner which are permitted under Section 10.06(c) plus (iv) the aggregate
amount of Permitted Lease Payments made in cash during such period.
"Foreign Employee Benefit Plan" means any employee benefit
plan as defined in Section 3(3) of ERISA which is maintained or contributed to
for the benefit of the employees of either Borrower, any Subsidiary of either
Borrower or any of its ERISA Affiliates and is not covered by ERISA pursuant to
ERISA Section 4(b)(4).
"Foreign Facilities" means those certain warehouse facilities
leased and operated by Burbank Aircraft International GmbH in Germany, by
Banner Aerospace-Singapore, Inc. (or another Subsidiary of Banner permitted to
be formed by the terms of this Agreement) in Singapore, Banner Aero (Australia)
Pty Ltd. in Australia, Banner Aerospace (UK) Limited in the United Kingdom, the
Canadian Subsidiary in the Province of Quebec, Canada, and, after the
consummation of the related Permitted Acquisitions, FSBC in Sweden and Airline
Rotables Ltd. in the United Kingdom.
"Foreign Inventory" means Inventory of Borrowers and their
Subsidiaries located at or in transit to Foreign Facilities.
"Foreign Pension Plan" means any employee pension benefit plan
as defined in Section 3(2) of ERISA which (i) is maintained or contributed to
for the benefit of employees of the Borrower, any of its Subsidiaries or any of
its ERISA Affiliates, (ii) is not covered by ERISA pursuant to Section 4(b)(4)
of ERISA, and (iii) under applicable local law, is required to be funded
through a trust or other funding vehicle.
"Fronting Fee" is defined in Section 5.03(a).
"FSBC" means ▇▇▇▇▇▇▇▇▇ Scandinavian Bellyloading Company
Aktiebolag, a corporation organized under the laws of Sweden.
"FSBC International" means Scandinavian Bellyloading
International, Inc., a California corporation.
"Funded Debt" means, for any period, the Indebtedness of the
Borrowers and their Subsidiaries for borrowed money (determined in accordance
with GAAP), including, without limitation, Indebtedness under Capital Leases,
during such period.
-19-
29
"Funding Date" means, with respect to any Loan, the date of
funding of such Loan.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the American Institute of Certified
Public Accountants' Accounting Principles Board and Financial Accounting
Standards Board or in such other statements by such other entity as may be in
general use by significant segments of the accounting profession as in effect
on the date hereof (unless otherwise specified herein as in effect on another
date or dates).
"General Intangibles" means, with respect to any Person, all
of such Person's present and future (i) general intangibles, (ii) rights,
interests, choses in action, causes of action, claims and other intangible
Property of every kind and nature (other than Receivables), (iii) corporate and
other business records, (iv) loans, royalties, and other obligations
receivable, (v) trademarks, registered trademarks, trademark applications,
service marks, registered service marks, service ▇▇▇▇ applications, patents,
registered patents, patent applications, trade names, rights of use of any
name, labels, fictitious names, inventions, designs, trade secrets, computer
programs, software, printouts and other computer materials, goodwill,
registrations, copyrights, copyright applications, permits, licenses,
franchises, customer lists, credit files, correspondence, and advertising
materials, (vi) customer and supplier contracts, firm sale orders, rights under
license and franchise agreements, rights under tax sharing agreements, and
other contracts and contract rights, (vii) interests in partnerships and joint
ventures, (viii) tax refunds and tax refund claims, (ix) right, title and
interest under leases, subleases, licenses and concessions and other agreements
relating to property, (x) deposit accounts (general or special) with any bank
or other financial institution, (xi) credits with and other claims against
third parties (including carriers and shippers), (xii) rights to
indemnification and with respect to support and keep-well agreements, (xiii)
reversionary interests in pension and profit sharing plans and reversionary,
beneficial and residual interests in trusts, (xiv) proceeds of insurance of
which such Person is beneficiary, (xv) letters of credit, guarantees, Liens,
security interests and other security held by or granted to such Person and
(xvi) uncertificated securities.
"Governmental Authority" means any nation or government, any
federal, state, local or other political sub division thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Guarantors" means the Persons identified on SCHEDULE 1.01.4
attached hereto and any other Person executing and
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delivering a guaranty of payment and performance of all or any portion of the
Obligations.
"Hedge Agreement" means any agreement, including, without
limitation, interest rate exchange, swap, collar or cap agreement, interest
rate future or option contract, currency swap agreement, currency exchange
contract, currency future or option contract, and other similar agreement,
evidencing an agreement or arrangement intended to protect against fluctuation
in interest rates and/or foreign exchange rates or conversion rates for
conversion of foreign currencies to Dollars or Dollars into foreign currencies.
"Holder" means any Person entitled to enforce any of the
Obligations, whether or not such Person holds any evidence of Indebtedness,
including, without limitation, the Administrative Agent, each Co-Agent, each
Lender and each Issuing Bank.
"Indebtedness", as applied to any Person, means, at any time,
without duplication, (a) all indebtedness, obligations or other liabilities of
such Person (i) for borrowed money or evidenced by debt Securities, debentures,
acceptances, notes or other similar instruments, and any accrued interest, fees
and charges relating thereto, (ii) under profit payment agreements or in
respect of obligations to redeem, repurchase or exchange any Securities of such
Person or to pay dividends in respect of any Capital Stock, (iii) with respect
to letters of credit issued for such Person's account, (iv) to pay the deferred
purchase price of property or services, (v) in respect of Capital Leases, (vi)
which are Accommodation Obligations or (vii) under warranties and indemnities;
(b) all indebtedness, obligations or other liabilities of such Person or others
secured by a Lien on any property of such Person, whether or not such
indebtedness, obligations or liabilities are assumed by such Person, all as of
such time, the amount of such indebtedness, obligations or other liabilities
being limited to the value of such property subject to such Lien; (c) all
indebtedness, obligations or other liabilities of such Person in respect of
interest rate contracts, Hedge Agreements and foreign exchange contracts, net
of liabilities owed to such Person by the counterparties thereon; (d) all
preferred stock subject (upon the occurrence of any contingency or otherwise)
to mandatory redemption; and (e) all contingent Contractual Obligations with
respect to any of the foregoing.
"Indemnified Matters" is defined in Section 15.03.
"Indemnitees" is defined in Section 15.03.
"Intercompany Debt" means Indebtedness owed by any Borrower or
Subsidiary of a Borrower to any Borrower or Subsidiary of a Borrower,
including, without limitation, the Reimbursement Obligations for Letters of
Credit issued under
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Article III but excluding any Indebtedness attributable to the Borrowers' joint
and several liability under this Agreement and the Notes and any Indebtedness
owing to any Guarantor by right of subrogation under the Loan Documents
executed by such Guarantor.
"Interest Coverage Ratio" means, for any period, the ratio of
(i) Banner's consolidated EBITDA to (ii) Cash Interest Expense.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter, any
successor statute and any regulations or guidance promulgated thereunder.
"Inventory" means, with respect to any Borrower or Guarantor,
all of such Person's present and future (i) inventory, (ii) goods, merchandise
and other personal property furnished or to be furnished under any contract of
service or intended for sale or lease, and all consigned goods and all other
items which have previously constituted Equipment of such Person but are then
currently being held for sale or lease in the ordinary course of such Person's
business, (iii) raw materials, work-in-process and finished goods, (iv)
materials and supplies of any kind, nature or description used or consumed in
such Person's business or in connection with the manufacture, production,
packing, shipping, advertising, finishing or sale of any of the property
described in clauses (i) through (iii) above, (v) goods in which such Person
has a joint or other interest or right of any kind (including, without
limitation, goods in which such Person has an interest or right as consignee),
and (vi) goods which are returned to or repossessed by such Person; in each
case whether in the possession of such Person, a bailee, a consignee, or any
other Person for sale, storage, transit, processing, use or otherwise, and any
and all documents for or relating to any of the foregoing.
"Investment" means, with respect to any Person, (i) any
purchase or other acquisition by that Person of Securities, or of a beneficial
interest in Securities, issued by any other Person, (ii) any purchase by that
Person of all or substantially all of the assets of a business conducted by
another Person, and (iii) any loan, advance (other than deposits with financial
institutions available for withdrawal on demand, prepaid expenses, accounts
receivable, advances to employees and similar items made or incurred in the
ordinary course of business) or capital contribution by that Person to any
other Person, including all Indebtedness to such Person arising from a sale of
property by such Person other than in the ordinary course of its business. The
amount of any Investment shall be the original cost of such Investment, plus
the cost of all additions thereto less the amount of any return of capital or
principal to the extent such return is in cash with respect to such Investment
without any
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adjustments for increases or decreases in value or write-ups, write-downs or
write-offs with respect to such Investment.
"IRS" means the Internal Revenue Service and any Person
succeeding to the functions thereof.
"Issuing Bank" means (i) Citibank, N.A. until assignment or
termination as contemplated in Section 15.01(i) and any successor thereto,
and/or (ii) any other Lender which by written agreement among the Borrowers,
the Administrative Agent and such Lender is designated an Issuing Bank, and any
successor thereto.
"July 1996 Credit Agreement" means that certain Amended and
Restated Credit Agreement dated as of July 1, 1996 among the Borrowers;
Citibank, as an Issuing Bank, Citicorp, as a Lender and Administrative Agent;
PNC Bank, National Association, as a Lender; Caisse Nationale de Credit
Agricole, as a Lender; The Long-Term Credit Bank of Japan, Ltd., Chicago
Branch, as a Lender; NationsBank, N.A., as a Lender; Sanwa Business Credit
Corporation, as a Lender; NBD Bank, as a Lender; The Sumitomo Bank, Limited, as
a Lender; Bank Polska Kasa Opieki, S.A., as a Lender; Pilgrim America Prime
Rate Trust, as a Lender; Protective Life Insurance Company, as a Lender
(pursuant to an assignment by Citicorp); ▇▇▇▇▇▇▇ ▇▇▇▇▇ Senior Floating Rate
Fund, Inc., as a Lender (pursuant to an assignment by Citicorp); ▇▇▇▇▇▇▇ ▇▇▇▇▇
Prime Rate Portfolio, as a Lender (pursuant to an assignment by Citicorp); and
Deutsche Financial Services, Inc., as a Lender (pursuant to an assignment by
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., which became a Lender pursuant to an
assignment by The Long-Term Credit Bank of Japan, Ltd.).
"Lender" means, as of the Effective Date, each financial
institution a signatory hereto as a Lender and, at any other given time, each
financial institution which is a party hereto as a Lender, whether as a
signatory hereto or pursuant to an Assignment and Acceptance.
"Letter of Credit" means any Commercial Letter of Credit or
Standby Letter of Credit.
"Letter of Credit Fee" is defined in Section 5.03(a).
"Letter of Credit Obligations" means, at any particular time,
the sum of (i) all outstanding Reimbursement Obligations, plus (ii) the
aggregate undrawn face amount of all outstanding Letters of Credit, plus (iii)
the aggregate face amount of all Letters of Credit requested by the Borrowers
but not yet issued (unless the request for an unissued Letter of Credit has
been denied by the applicable Issuing Bank as referenced in Section
3.01(c)(i)).
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"Letter of Credit Reimbursement Agreement" means, with respect
to a Letter of Credit, such form of application therefor and form of
reimbursement agreement therefor (whether in a single or several documents,
taken together) as the respective Issuing Bank from which the Letter of Credit
is requested may employ in the ordinary course of business for its own account,
with such modifications thereto as may be agreed upon by such Issuing Bank and
the Borrowers and as are not materially adverse (in the judgment of such
Issuing Bank and Administrative Agent) to the interests of the Lenders;
provided, however, in the event of any conflict between the terms of any Letter
of Credit Reimbursement Agreement and this Agreement, the terms of this
Agreement shall control.
"Leverage Ratio" means, for any period, the ratio of average
daily Funded Debt to EBITDA for such period.
"Liabilities and Costs" means all liabilities, obligations,
responsibilities, losses, damages, personal injury, death, punitive damages,
economic damages, consequential damages, treble damages, intentional, willful
or wanton injury, damage or threat to the environment, natural resources or
public health or welfare, costs and expenses (including, without limitation,
attorney, expert and consulting fees and costs and fees and costs associated
with any investigation, feasibility or Remedial Action studies), fines,
penalties and monetary sanctions, interest, direct or indirect, known or
unknown, absolute or contingent, past, present or future.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, conditional sale agreement, deposit arrangement,
security interest, encumbrance, lien (statutory or other and including, without
limitation, any Environmental Lien), preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever in
respect of any property of a Person, whether granted voluntarily or imposed by
law, and includes the interest of a lessor under a Capital Lease or under any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement or similar notice (other
than a financing statement filed by a "true" lessor pursuant to Section 9-408
of the Uniform Commercial Code), naming the owner of such property as debtor,
under the Uniform Commercial Code or other comparable law of any jurisdiction.
"Loan Account" is defined in Section 4.03(b).
"Loan Documents" means this Agreement, the Notes, Hedge
Agreements to which any Lender or any Affiliate of a Lender is a party, foreign
exchange contracts to which any Lender or any Affiliate of a Lender is a party,
and all other instruments, agreements, security agreements, mortgages,
guarantees, and other
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34
written Contractual Obligations between either Borrower or any Subsidiary of
either Borrower and any of the Administrative Agent, any Co-Agent, any Lender
or any Issuing Bank delivered to either the Administrative Agent, such
Co-Agent, such Lender or such Issuing Bank pursuant to or in connection with
the transactions contemplated hereby.
"Loans" means all Term Loans, Tranche B Term Loans, Tranche C
Term Loans, Revolving Loans and Swing Loans, whether Base Rate Loans or
Eurodollar Rate Loans.
"LTCB" means The Long-Term Credit Bank of Japan, Ltd., Chicago
Branch, a bank organized under the laws of Japan acting through its Chicago
Branch.
"Margin Stock" means "margin stock" as such term is defined in
Regulation U and Regulation G.
"Material Adverse Effect" means a material adverse effect upon
(i) the financial condition, operations, assets or prospects of any of (a)
Banner and its Subsidiaries, taken as a whole, or (b) so long as Burbank either
(1) owns a minimum of twenty-five percent (25%) of the Receivables and
Inventory comprising part of the Collateral or (2) has EBITDA equal to a
minimum of twenty-five percent (25%) of the EBITDA of Banner and its
Subsidiaries, Burbank, (ii) the ability of either Borrower or any Subsidiary of
either Borrower to perform their respective obligations under the Loan
Documents, or (iii) the ability of the Lenders, the Issuing Banks, the
Administrative Agent or any Co- Agent to enforce any of the Loan Documents.
"MIS" means computerized management information system for
recording and maintenance of information regarding purchases, sales, aging,
categorization, and locations of Inventory, creation and aging of Receivables,
and accounts payable (including agings thereof).
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA which is, or within the immediately preceding
five (5) years was, contributed to by either Borrower or any ERISA Affiliate or
in respect of which either Borrower or any ERISA Affiliate has assumed any
liability.
"NationsBank" means NationsBank, N.A., a national banking
association.
"Net Cash Proceeds of Issuance of Equity Securities or
Indebtedness" means (i) net cash proceeds (including cash, equivalents readily
convertible into cash, and such proceeds of any notes received as consideration
or any other non-cash consideration) received by either Borrower or any
Subsidiary of either Borrower at any time after the Closing Date on account of
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the issuance of (a) equity Securities of either Borrower or any Subsidiary of
either Borrower (other than (1) Capital Stock of a Subsidiary issued to a
Borrower or to a Subsidiary of a Borrower, (2) Capital Stock issued pursuant to
Permitted Equity Securities Options or similar employee options established
after the Closing Date and (3) the Preferred Stock) or (b) Indebtedness (other
than Indebtedness permitted under Section 10.01) of either Borrower or any
Subsidiary of either Borrower, in each case net of all transaction costs and
underwriters' discounts with respect thereto; and (ii) proceeds received by
either Borrower at any time after the Closing Date as a contribution to its
capital on account of the issuance of equity Securities of such Borrower.
"Net Cash Proceeds of Sale" means (i) proceeds received by a
Borrower or any Subsidiary of a Borrower in cash (including cash, equivalents
readily convertible into cash, and cash proceeds of any notes which are
executed and delivered after (but not before) the Closing Date or any other
non-cash consideration which is received after the Closing Date) from the sale,
assignment or other disposition of (but not the lease or license of) any
Property, other than sales permitted under clauses (b), (c), (g), and (i) of
Section 10.02, net of (a) the costs of sale, assignment or other disposition,
(b) any income, franchise, transfer or other tax liability arising from such
transaction and (c) amounts applied to the repayment of Indebtedness (other
than the Obligations) secured by a Lien permitted by Section 10.03 on the asset
disposed of, if such net proceeds arise from any individual sale, assignment or
other disposition or from any group of related sales, assignments or other
dispositions; and (ii) to the extent provided in Section 9.08(b), Net Insurance
and Condemnation Proceeds.
"Net Income" means, for any period, the net earnings (or loss)
after taxes of the Borrowers and their Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP.
"Net Insurance and Condemnation Proceeds" means proceeds
(including cash, equivalents readily convertible into cash, and such proceeds
of any notes received in lieu of cash) of insurance policies described in
Section 9.08 and proceeds of condemnation awards described in Section 9.08
required to be remitted to the Administrative Agent as provided in Section
9.08(b), net of the costs associated with collection of such proceeds.
"1995 Credit Agreement" means that certain Credit Agreement
dated as of August 2, 1995 among the Borrowers; Citibank, as an Issuing Bank;
Citicorp, as a Lender and Administrative Agent; PNC Bank, National Association,
as a Lender and Issuing Bank; Caisse Nationale de Credit Agricole, as a Lender;
The Long-Term Credit Bank of Japan, Ltd., Chicago Branch,
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as a Lender; NationsBank, N.A., as a Lender; Sanwa Business Credit Corporation,
as a Lender; NBD Bank, as a Lender; and The Daiwa Bank, Limited, as a Lender,
as amended prior to July 1, 1996.
"1995 Fee Letter" means that certain fee letter addressed to
Citicorp and Citicorp Securities, Inc. from Borrowers dated June 7, 1995.
"1996 Commitment Letter" means that certain commitment letter,
together with Annex I thereto, addressed to the Borrowers from Citicorp dated
November 6, 1996.
"1996 Fee Letter" means that certain fee letter addressed to
the Administrative Agent from the Borrowers dated November 8, 1996.
"Non Pro Rata Loan" is defined in Section 4.02(b)(v).
"Note" means a promissory note in a form attached hereto as
EXHIBIT E-1 or E-2 payable to a Lender, evidencing certain of the Obligations
of the Borrowers to such Lender and executed by the Borrowers as required by
Section 4.03(a), as the same may be amended, supplemented, modified or restated
from time to time, and any promissory note issued in substitution therefor;
"Notes" means, collectively, all of such Notes outstanding at any given time.
"Notice of Borrowing" means a notice substantially in the form
of EXHIBIT F attached hereto and made a part hereof.
"Notice of Conversion/Continuation" means a notice
substantially in the form of EXHIBIT G attached hereto and made a part hereof
with respect to a proposed conversion or continuation of a Loan pursuant to
Section 5.01(c).
"Obligations" means all Loans, advances, debts, liabilities,
obligations, covenants and duties owing by the Borrowers, individually and
collectively, to the Administrative Agent, any Co-Agent, any Lender, any
Issuing Bank, any Affiliate of the Administrative Agent, any Co-Agent, any
Lender or any Issuing Bank, or any Person entitled to indemnification pursuant
to Section 15.03 of this Agreement, of any kind or nature, present or future,
whether or not evidenced by any note, guaranty or other instrument, arising
under this Agreement, the Notes or any other Loan Document, whether or not for
the payment of money, whether arising by reason of an extension of credit,
opening or amendment of a Letter of Credit or payment of any draft drawn
thereunder, loan, guaranty, indemnification, Hedge Agreement or in any other
manner, whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter arising
and however acquired. The
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term includes, without limitation, all interest, charges, expenses, fees,
attorneys' fees and disbursements and any other sum chargeable to either
Borrower or both Borrowers under this Agreement or any other Loan Document.
"Officer's Certificate" means, as to a corporation, a
certificate executed on behalf of such corporation by the chairman or
vice-chairman of its board of directors (if an officer of such corporation) or
its president, any of its vice-presidents, its chief financial officer, its
treasurer or its controller.
"Operating Lease" means, as applied to any Person, any lease
of any property (whether real, personal or mixed) by that Person as lessee
which is not a Capital Lease.
"Organizational Documents" means, with respect to any
corporation, limited liability company, or partnership (i) the
articles/certificate of incorporation (or the equivalent organizational
documents) of such corporation or limited liability company, (ii) the
partnership agreement executed by the partners in the partnership, (iii) the
by-laws (or the equivalent governing documents) of the corporation, limited
liability company or partnership, and (iv) any document setting forth the
designation, amount and/or relative rights, limitations and preferences of any
class or series of such corporation's Capital Stock or such limited liability
company's or partnership's equity or ownership interests.
"OSHA" means the Occupational Safety and Health Act of 1970,
29 U.S.C. Sections 651 et seq., any amendments thereto, any successor statutes
and any regulations or guidance promulgated thereunder.
"Other Indebtedness" means all of the unsecured Indebtedness
of Borrowers and their Subsidiaries, including, without limitation,
Intercompany Debt, but excluding the Obligations.
"PBGC" means the Pension Benefit Guaranty Corporation and any
Person succeeding to the functions thereof.
"Pending Revolving Loans" means, at any time of determination,
the aggregate principal amount of all Revolving Loans requested in any
Notice(s) of Borrowing previously received by the Administrative Agent but not
yet advanced or otherwise made at such time minus the aggregate principal
amount of all Swing Loans outstanding at such time which will be repaid with
the proceeds of such Pending Revolving Loans on the Funding Date therefor
pursuant to a request by Borrowers to the Administrative Agent instructing the
Administrative Agent to remit the proceeds of such Pending Revolving Loans to
the Swing Lender for application to the Swing Loans then outstanding.
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"Performance Level 1" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is less than 2.50 to 1.00.
"Performance Level 2" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is less than 3.25 to 1.00 and equal to or greater than 2.50 to
1.00.
"Performance Level 3" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is less than 3.75 to 1.00 and equal to or greater than 3.25 to
1.00.
"Performance Level 4" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is less than 4.25 to 1.00 and equal to or greater than 3.75 to
1.00.
"Performance Level 5" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is less than 5.50 to 1.00 and equal to or greater than 4.25 to
1.00.
"Performance Level 6" means that level of financial
performance of the Borrowers and their Subsidiaries, on a consolidated basis,
measured as of the end of a fiscal quarter of the Borrowers, at which the
Leverage Ratio for the then most recently ended four (4) fiscal quarter period
of the Borrowers is equal to or greater than 5.50 to 1.00.
"Permits" means any permit, approval, authorization license,
variance, or permission required from a Governmental Authority or other Person
under an applicable Requirement of Law.
"Permitted Acquisitions" means the acquisitions by Banner or
the Subsidiary of Banner designated on SCHEDULE 1.01.05 attached hereto and
made a part hereof of the assets or Capital Stock of the Persons identified on
SCHEDULE 1.01.05
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"Permitted Engine Leases" means leases of Engines sold to
financial institutions reasonably acceptable to the Administrative Agent by
Dallas Aerospace, Inc. as permitted under Section 10.11, under Operating Leases
having Dallas Aerospace, Inc., as lessee, and such financial institutions, as
lessors.
"Permitted Equity Securities Options" means the subscriptions,
options, warrants, rights, convertible securities and other agreements or
commitments relating to the issuance of equity Securities of either Borrower or
any Subsidiary of either Borrower identified as such on SCHEDULE 1.01.6.
"Permitted Existing Accommodation Obligations" means those
Accommodation Obligations of either Borrower and Subsidiaries of either
Borrower identified as such on SCHEDULE 1.01.7.
"Permitted Existing Indebtedness" means the Indebtedness of
either Borrower and Subsidiaries of either Borrower identified as such on
SCHEDULE 1.01.8.
"Permitted Existing Investments" means those Investments
identified as such on SCHEDULE 1.01.9.
"Permitted Existing Liens" means the Liens on assets of either
Borrower or any Subsidiary of either Borrower identified as such on SCHEDULE
1.01.10.
"Permitted Lease Payments" means payments made by Dallas
Aerospace, Inc. in an aggregate amount in any Fiscal Year not to exceed
$7,500,000 under Permitted Engine Leases.
"Person" means any natural person, corporation, limited
liability company, limited partnership, general partnership, joint stock
company, joint venture, association, company, trust, bank, trust company, land
trust, business trust or other organization, whether or not a legal entity, and
any Governmental Authority.
"Plan" means an employee benefit plan defined in Section 3(3)
of ERISA (other than a Multiemployer Plan) in respect of which either Borrower
or any ERISA Affiliate is, or within the immediately preceding five (5) years
was, an "employer" as defined in Section 3(5) of ERISA or either Borrower or
any ERISA Affiliate has assumed any liability.
"Potential Event of Default" means an event which, with the
giving of notice or the lapse of time, or both, would constitute an Event of
Default.
"Preferred Stock" means Convertible Preferred Stock issued by
Banner on or before March 31, 1997 subject to terms and conditions
substantially similar to, or more advantageous to
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Banner than, those set forth on SCHEDULE 1.01.11 and such other terms and
conditions as are determined acceptable by the Administrative Agent in its
reasonable discretion.
"Preferred Stock Issue Date" means the date on or before March
31, 1997 on which all net proceeds from the issuance of the Preferred Stock are
received by Banner.
"Process Agent" means the Person designated and appointed by
the Borrowers as their agent for service of all process as more particularly
described in Section 15.17(a)(i).
"Projections" means the financial projections and assumptions
prepared by the Borrowers dated October 22, 1996 and attached hereto as EXHIBIT
H.
"Property" means any Real Property or personal property,
plant, building, facility, structure, underground storage tank or unit,
Equipment, Inventory, General Intangible, Receivable, or other asset owned,
leased or operated by either Borrower or any Subsidiary of either Borrower, as
applicable, (including any surface water thereon, and soil and groundwater
thereunder).
"Pro Rata Share" means, with respect to any Lender, the
percentage obtained by dividing (i) the sum of such Lender's Term Loan
Commitment and Revolving Credit Commitment (in each case, as adjusted from time
to time in accordance with the provisions of this Agreement or any Assignment
and Acceptance to which such Lender is a party) by (ii) the aggregate amount of
all of the Term Loan Commitments and Revolving Credit Commitments
(notwithstanding the termination of any such Commitments).
"Protective Advance" is defined in Section 13.09(a).
"Purchase Money Indebtedness" means Indebtedness (i) the
proceeds of which are used by a Borrower or a Subsidiary of a Borrower to make
Capital Expenditures permitted pursuant to Section 11.05 and which is secured
solely by purchase money Liens permitted by Section 10.03(d) and (ii) incurred
by Burbank under its Contractual Obligation for the purchase of the Airbus
Inventory and which is secured solely by purchase money Liens or retention of
title permitted by Section 10.03(d)..
"RCRA" means the Resource Conservation and Recovery Act of
1976, 42 U.S.C. Sections 6901 et seq., any amendments thereto, any successor
statutes, and any regulations promulgated thereunder.
"Real Property" means, with respect to any Person, all of such
Person's present and future right, title and interest (including, without
limitation, any leasehold estate) in (i) any plots, pieces or parcels of land,
(ii) any improvements,
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buildings, structures and fixtures now or hereafter located or erected thereon
or attached thereto of every nature whatsoever (the rights and interests
described in clauses (i) and (ii) above being the "Premises"), (iii) all
easements, rights of way, gores of land or any lands occupied by streets, ways,
alleys, passages, sewer rights, water courses, water rights and powers, and
public places adjoining such land, and any other interests in property
constituting appurtenances to the Premises, or which hereafter shall in any way
belong, relate or be appurtenant thereto, (iv) all hereditaments, gas, oil,
minerals (with the right to extract, sever and remove such gas, oil and
minerals), and easements, of every nature whatsoever, located in or on the
Premises and (v) all other rights and privileges thereunto belonging or
appertaining and all extensions, additions, improvements, betterments,
renewals, substitutions and replacements to or of any of the rights and
interests described in clauses (iii) and (iv) above.
"Receivables" means, with respect to any Person, all of such
Person's present and future (i) accounts, (ii) contract rights, chattel paper,
instruments, documents, deposit accounts, and other rights to payment of any
kind, whether or not arising out of or in connection with the sale or lease of
goods or the rendering of services, and whether or not earned by performance,
(iii) any of the foregoing which are not evidenced by instruments or chattel
paper, (iv) intercompany receivables, and any security documents executed in
connection therewith, (v) proceeds of any letters of credit or insurance
policies on which such Person is named as beneficiary, (vi) claims against
third parties for advances and other financial accommodations and any other
obligations whatsoever owing to such Person, (vii) rights in and to all
security agreements, leases, guarantees, instruments, securities, documents of
title and other contracts securing, evidencing, supporting or otherwise
relating to any of the foregoing, together with all rights in any goods,
merchandise or Inventory which any of the foregoing may represent, and (viii)
rights in returned and repossessed goods, merchandise and Inventory which any
of the same may represent, including, without limitation, any right of stoppage
in transit.
"Reference Banks" means Citibank and NationsBank.
"Register" is defined in Section 15.01(c).
"Regulation A" means Regulation A of the Federal Reserve Board
as in effect from time to time.
"Regulation G" means Regulation G of the Federal Reserve Board
as in effect from time to time.
"Regulation T" means Regulation T of the Federal Reserve Board
as in effect from time to time.
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"Regulation U" means Regulation U of the Federal Reserve Board
as in effect from time to time.
"Regulation X" means Regulation X of the Federal Reserve Board
as in effect from time to time.
"Reimbursement Date" is defined in Section 3.01(d)(i)(A).
"Reimbursement Obligations" means the aggregate non-contingent
reimbursement or repayment obligations of the Borrowers with respect to amounts
drawn under Letters of Credit.
"Release" means any release, spill, emission, leaking,
pumping, pouring, dumping, injection, deposit, disposal, abandonment, or
discarding of barrels, containers or other receptacles, discharge, emptying,
escape, dispersal, leaching or migration into the indoor or outdoor environment
or into or out of any Property, including the movement of Contaminants through
or in the air, soil, surface water, groundwater or Property to the extent that
any of the foregoing is regulated pursuant to or gives rise to liability under
any Environmental Health or Safety Requirement of Law.
"Remedial Action" means actions required to (i) clean up,
remove, treat or in any other way address Contaminants in the indoor or outdoor
environment; (ii) prevent the Release or threat of Release or minimize the
further Release of Contaminants; or (iii) investigate and determine if a
remedial response is needed and to design such a response and post-remedial
investigation, monitoring, operation and maintenance and care.
"Replacement Proceeds" means the amount of (i) proceeds of
insurance paid on account of the loss of or damage to any Property and awards
of compensation for Property taken by condemnation or eminent domain to the
extent actually used to replace, rebuild or restore the Property so lost,
damaged or taken, provided that (a) Borrowers shall have delivered written
notice to the Administrative Agent that it or its applicable Subsidiary intends
to so replace, rebuild or restore such Property and (b) the applicable Borrower
or such applicable Subsidiary of a Borrower replaces or commences the
restoration or rebuilding of such Property within 180 days after the
Administrative Agent's receipt of the proceeds of such insurance payment or
condemnation award and (ii) insurance paid on account of a business
interruption occurrence to the extent actually used in the restoration or
conduct of the business interrupted.
"Reportable Event" means any of the events described in
Section 4043(b) of ERISA and the regulations promulgated thereunder as in
effect from time to time other than an event for
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which the thirty (30) day notice requirement has been waived by the PBGC.
"Requirements of Law" means, as to any Person, the charter and
by-laws or other organizational or governing documents of such Person, and any
law, rule or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject including, without limitation, the Securities Act, the Securities
Exchange Act, Regulations G, T, U and X, ERISA, the Fair Labor Standards Act,
the Worker Adjustment and Retraining Notification Act, Americans with
Disabilities Act of 1990, and any certificate of occupancy, zoning ordinance,
building, environmental or land use requirement or Permit or and Environmental,
Health or Safety Requirement of Law.
"Requisite Lenders" means Lenders whose Pro Rata Shares, in
the aggregate, are at least fifty-one percent (51%); provided, however, that,
in the event any of the Lenders shall have failed to fund its Revolving Loan
Pro Rata Share of any Revolving Loan requested by the Borrowers which such
Lender is obligated to fund under the terms of this Agreement and any such
failure has not been cured, then for so long as such failure continues,
"Requisite Lenders" means Lenders (excluding all Lenders whose failure to fund
their respective Revolving Loan Pro Rata Shares of such Revolving Loans have
not been so cured) whose Pro Rata Shares represent at least fifty-one percent
(51%) of the aggregate Pro Rata Shares of such Lenders; provided, further,
however, that, in the event that the Commitments have been terminated pursuant
to the terms of this Agreement, "Requisite Lenders" means Lenders (without
regard to such Lenders' performance of their respective obligations hereunder)
whose aggregate ratable shares (stated as a percentage) of the aggregate
outstanding principal balance of all Loans aggregate at least fifty-one percent
(51%).
"Requisite Revolving Lenders" means Revolving Lenders whose
Revolving Pro Rata Shares, in the aggregate, are at least fifty-one percent
(51%); provided, however, that, in the event any of the Revolving Lenders shall
have failed to fund its Revolving Loan Pro Rata Share of any Revolving Loan
requested by the Borrowers which such Revolving Lender is obligated to fund
under the terms of this Agreement and any such failure has not been cured, then
for so long as such failure continues, "Requisite Revolving Lenders" means
Revolving Lenders (excluding all Revolving Lenders whose failure to fund their
respective Revolving Loan Pro Rata Shares of such Revolving Loans have not been
so cured) whose Revolving Loan Pro Rata Shares represent at least fifty-one
percent (51%) of the aggregate Revolving Loan Pro Rata Shares; provided,
further, however, that, in the event that the Revolving Credit Commitments have
been terminated pursuant to
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the terms of this Agreement, "Requisite Revolving Lenders" means Revolving
Lenders (without regard to such Revolving Lenders' performance of their
respective obligations hereunder) whose aggregate ratable shares (stated as a
percentage) of the aggregate outstanding principal balance of all Revolving
Loans aggregate at least fifty-one percent (51%).
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
Capital Stock of either Borrower or any Subsidiary of either Borrower now or
hereafter outstanding, except a dividend payable solely in shares of that class
of stock or in any junior class of stock to the holders of that class, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of equity
Securities of either Borrower or any Subsidiary of either Borrower now or
hereafter outstanding, (iii) any prepayment of principal of, premium, if any,
or interest, fees or other charges on or with respect to, and any prepayment,
redemption, purchase, retirement, defeasance, sinking fund or similar payment
and any claim for rescission with respect to or any Indebtedness for borrowed
money other than the Obligations, and (iv) any payment made to redeem,
purchase, repurchase or retire, or to obtain the surrender of, any out standing
warrants, options or other rights to acquire shares of any class of Capital
Stock of either Borrower or any Subsidiary of either Borrower now or hereafter
outstanding.
"Revolving Credit Availability" means the amount by which the
lesser of
(a) the Revolving Credit Commitments at such time and
(b) the Borrowing Base at such time minus the outstanding principal
balance of the Term Loans at such time minus the outstanding principal
balance of the Tranche B Term Loans at such time, minus the
outstanding principal balance of the Tranche C Term Loans at such
time, plus (i) $10,000,000, if the Preferred Stock has not been issued
and the date of determination of "Revolving Credit Availability"
occurs during the period commencing on the Effective Date and ending
on ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) $7,500,000, if the Preferred Stock has not
been issued and the date of determination of "Revolving Credit
Availability" occurs during the period commencing on April 1, 1997 and
ending on July 1, 1997 or (iii) $15,000,000, commencing on the
Preferred Stock Issue Date and ending on the date immediately
preceding the second anniversary of the Effective Date,
exceeds the sum of (1) the Revolving Credit Obligations at such time plus (2)
the outstanding balance of Protective Advances at
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such time plus (3) the outstanding balance of the Swing Loans at such time.
"Revolving Credit Commitment" means, with respect to any
Lender, the obligation of such Lender to make Revolving Loans and to
participate in Letters of Credit pursuant to the terms and conditions of this
Agreement, in an aggregate amount at any time outstanding which shall not
exceed the principal amount set forth opposite such Lender's name under the
heading "Revolving Credit Commitment" on the signature pages hereof or the
signature page of the Assignment and Acceptance by which it became a Lender, as
modified from time to time pursuant to the terms of this Agreement or to give
effect to any applicable Assignment and Acceptance, and "Revolving Credit
Commitments" means the aggregate principal amount of the Revolving Credit
Commitments of all the Lenders, the maximum amount of which shall be
$71,500,000, as reduced from time to time pursuant to Section 4.01.
"Revolving Credit Obligations" means, at any particular time,
the sum of (i) the outstanding principal amount of the Revolving Loans at such
time, plus (ii) the Letter of Credit Obligations at such time.
"Revolving Credit Termination Date" means the earlier to occur
of (i) August 1, 2001 (or, if not a Business Day, the next preceding Business
Day), (ii) the date of termination of the Revolving Credit Commitments pursuant
to the terms of this Agreement, and (iii) the date of acceleration of the
Obligations pursuant to Section 12.02.
"Revolving Lenders" means those Lenders having a Revolving
Credit Commitment; and "Revolving Lender" means one of the Revolving Lenders,
individually.
"Revolving Loan" is defined in Section 2.02(a).
"Revolving Loan Pro Rata Share" means, with respect to any
Revolving Lender, the percentage obtained by dividing (i) the amount of such
Lender's Revolving Credit Commitment (as adjusted from time to time in
accordance with the provisions of this Agreement or any Assignment and
Acceptance to which such Lender is a party) by (ii) the aggregate amount of all
Revolving Credit Commitments (notwithstanding the termination of any such
Commitments).
"Revolving Notes" means promissory notes executed by the
Borrowers and delivered to the Lenders evidencing the Revolving Loans, as the
same may be amended, supplemented, modified or restated from time to time, and
any promissory note issued in substitution therefor, substantially in the form
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attached hereto as EXHIBIT E-1; and "Revolving Note" means any one of the
Revolving Notes.
"RHI" means RHI Holdings, Inc., a Delaware corporation,
shareholder of Banner, and Wholly-Owned Subsidiary of Fairchild.
"Securities" means any Capital Stock, shares, voting trust
certificates, limited partnership certificates, bonds, debentures, notes or
other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities", including, without limitation, any "security" as such term is
defined in Section 8-102 of the Uniform Commercial Code, or any certificates of
interest, shares, or participations in temporary or interim certificates for
the purchase or acquisition of, or any right to subscribe to, purchase or
acquire any of the foregoing, but shall not include the Notes or any other
evidence of the Obligations.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, and any successor statute.
"Solvent", when used with respect to any Person, means that at
the time of determination:
(i) the Fair Market Value of its assets is in excess of the
total amount of its liabilities (including, without limitation,
contingent liabilities); and
(ii) the present fair saleable value of its assets is greater
than its probable liability on its existing debts as such debts become
absolute and matured; and
(iii) it is then able and expects to be able to pay its debts
(including, without limitation, contingent debts and other
commitments) as they mature; and
(iv) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted.
"Standby Letter of Credit" means any letter of credit issued
by an Issuing Bank pursuant to Section 3.01 for the account of the Borrowers or
for the account of any of the Borrowers' Subsidiaries if the Borrowers are
jointly and severally liable for reimbursement of amounts drawn under such
letter of credit, which is not a Commercial Letter of Credit.
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"Subsidiary" of a Person means any corporation, limited
liability company, general or limited partnership, or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other Persons performing similar
functions with respect to such entity are at the time directly or indirectly
owned or controlled by such Person, one or more of the other subsidiaries of
such Person or any combination thereof.
"Swing Lender" means Citicorp or any other Lender designated
by the Administrative Agent with the concurrence of such other Lender.
"Swing Loan Availability" is defined in Section 2.03(a).
"Swing Loan Reserve" means, at any time, a reserve in an
amount equal to the then outstanding balance of the Swing Loans.
"Swing Loans" is defined in Section 2.03(a).
"Swing Loan Subfacility" means, at any time, an amount equal
to $1,000,000.
"Tax Sharing Agreement" means either of (i) that certain Tax
Indemnity Agreement dated July 11, 1990 between The ▇▇▇▇▇▇▇▇▇ Corporation
(formerly Banner Industries, Inc.) and Banner, as in effect on the Closing
Date, or (ii) that certain Tax Allocation Agreement dated as of January 22,
1992 among Banner and its domestic Subsidiaries, as in effect on the Closing
Date or amended to include Persons acquired in Permitted Acquisitions; and "Tax
Sharing Agreements" means the agreements described in clauses (i) and (ii)
hereinabove collectively.
"Taxes" is defined in Section 14.01(a).
"Term Lenders" means those Lenders having a Term Loan
Commitment; and "Term Lender" means one of the Term Lenders, individually.
"Term Loan" is defined in Section 2.01(a)(i).
"Term Loan Commitment" means, with respect to any Lender (i)
having outstanding Term Loans under the 1995 Credit Agreement, the outstanding
principal balance of such Lender's Term Loan made pursuant to the terms and
conditions of the 1995 Credit Agreement as set forth under such Lender's name
under the heading "1995 Term Loan Commitment" on the signature pages hereof or
the signature page of the Assignment and Acceptance by which it became a
Lender, as modified from time to time pursuant to the terms of this Agreement
or to give effect to any applicable
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Assignment and Acceptance, (ii) having outstanding Tranche B Term Loans under
the July 1996 Credit Agreement, the outstanding principal balance of such
Lender's Tranche B Loan made pursuant to the terms and conditions of the July
1996 Credit Agreement as set forth under such Lender's name under the heading
"Tranche B Term Loan Commitment" on the signature pages hereof or the signature
page of the Assignment and Acceptance by which it became a Lender, as modified
from time to time pursuant to the terms of this Agreement to give effect to any
applicable Assignment and Acceptance, and (iii) having an obligation to make a
Tranche C Term Loan pursuant to the terms and conditions of this Agreement, the
obligation of such Lender to make such Tranche C Term Loan in an amount equal
to the amount set forth under such Lender's name under the heading "Tranche C
Term Loan Commitment" on the signature pages hereof or the signature page of
the Assignment and Acceptance by which it became a Lender, as modified from
time to time pursuant to the terms of this Agreement or to give effect to any
applicable Assignment and Acceptance; provided that, in the event any Lender
has a combination of a 1995 Term Loan Commitment, a Tranche B Term Loan
Commitment, and a Tranche C Term Loan Commitment, its "Term Loan Commitment"
shall be the sum of its 1995 Term Loan Commitment plus its Tranche B Term Loan
Commitment, plus its Tranche C Term Loan Commitment and "Term Loan Commitments"
means the aggregate principal amount of the 1995 Term Loan Commitments, the
Tranche B Term Loan Commitments, and the Tranche C Term Loan Commitments of all
the Lenders, the maximum amount of which shall be $118,000,000, as reduced from
time to time pursuant to Sections 2.01(d) or 4.01.
"Term Loan Pro Rata Share" means, with respect to any Term
Lender, the percentage obtained by dividing (i) the amount of such Term
Lender's Term Loan Commitment which is not designated as a Tranche B Term Loan
Commitment or Tranche C Term Loan Commitment by (ii) the aggregate amount of
all of the Term Loan Commitments not designated as Tranche B Term Loan
Commitments or Tranche C Term Loan Commitments.
"Term Loan Termination Date" means the earlier of (i) August
1, 2001 and (ii) the date of acceleration of the Obligations pursuant to
Section 12.02.
"Term Notes" means promissory notes executed by the Borrowers
and delivered to the Lenders evidencing the Term Loans, the Tranche B Term
Loans and the Tranche C Term Loans, as the same may be amended, supplemented,
modified or restated from time to time, and any promissory note issued in
substitution therefor, substantially in the form attached hereto as EXHIBIT
E-2; and "Term Note" means any one of the Term Notes.
"Termination Event" means (i) a Reportable Event with respect
to any Benefit Plan; (ii) the withdrawal of a Borrower or
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any ERISA Affiliate from a Benefit Plan during a plan year in which such
Borrower or such ERISA Affiliate was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA; (iii) the filing under Section 4041 of ERISA of a
notice of intent to terminate a Benefit Plan or the treatment of a Benefit Plan
amendment as a termination under Section 4041 of ERISA; (iv) the institution by
the PBGC of proceedings to terminate a Benefit Plan; (v) any event or condition
which could reasonably be expected to constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer,
any Benefit Plan; or (vi) the partial or complete withdrawal of either Borrower
or any ERISA Affiliate from a Multiemployer Plan if the amount of the
withdrawal liability assessed by the Plan sponsor against either Borrower or
any ERISA Affiliate is material.
"Texas Tax Reserve" means, at any time, a reserve in an amount
equal to the aggregate amount of the taxes payable by Borrowers and their
Subsidiaries under the statutes of the State of Texas with respect to which a
tax lien attaches to Property of such Persons located in the State of Texas
pursuant to Section 32.01 of the Texas Tax Code, which amount shall be
determined by the Borrowers as of the date of each Borrowing Base Certificate
and disclosed by the Borrowers thereon; provided, however, that at any time
such aggregate amount of taxes is less than $500,000, the "Texas Tax Reserve"
shall be deemed to be zero.
"Total Book Value" means the total book value (at the lower of
cost or market value) determined in accordance with GAAP, on a basis consistent
with that used as of the Closing Date, and set forth in the Financial
Statements from time to time.
"Total Interest Expense" means, for any period, all of the
Borrowers and their Subsidiaries expense, whether paid or accrued and without
duplication, for interest, amortization of fees, and all other financing
charges, as determined in accordance with GAAP, and including, without
limitation, Cash Interest Expense.
"Tranche B Term Lenders" means those Lenders having a Term
Loan Commitment designated as a Tranche B Term Loan Commitment; and "Tranche B
Term Lender" means one of the Tranche B Term Lenders, individually.
"Tranche B Term Loan" is defined in Section 2.01(a)(i).
"Tranche B Term Loan Pro Rata Share" means, with respect to
any Tranche B Term Lender, the percentage obtained by dividing (i) the amount
of such Tranche B Term Lender's Term Loan Commitment designated as a Tranche B
Term Loan Commitment by (ii)
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the aggregate amount of all of the Term Loan Commitments designated as Tranche
B Term Loan Commitments.
"Tranche B Term Loan Termination Date" means the earlier of
(i) June 30, 2003 and (ii) the date of acceleration of the Obligations pursuant
to Section 12.02.
"Tranche C Base Rate Margin" means (i) one and one-half
percent (1.50%) per annum, as of any date of determination during the period
commencing on the Effective Date and ending on the later to occur of (a)
September 30, 1997 or (b) the date as of which the financial performance of the
Borrowers and their Subsidiaries, as determined in accordance with the
provisions of Section 5.04, meets the criteria for at least Performance Level 4
and (ii) one and one-quarter percent (1.25%) per annum, as of any date of
determination thereafter.
"Tranche C Eurodollar Rate Margin" means (i) two and
three-quarters percent (2.75%) per annum, as of any date of determination
during the period commencing on the Effective Date and ending on the later to
occur of (a) September 30, 1997 or (b) the date as of which the financial
performance of the Borrowers and their Subsidiaries, as determined in
accordance with the provisions of Section 5.04, meets the criteria for at least
Performance Level 4 and (ii) two and one-half percent (2.50%) per annum, as of
any date of determination thereafter.
"Tranche C Term Lenders" means those Lenders having a Term
Loan Commitment designated as a Tranche C Term Loan Commitment; and "Tranche C
Term Lender" means one of the Tranche C Term Lenders, individually.
"Tranche C Term Loan" is defined in Section 2.01(a)(ii).
"Tranche C Term Loan Pro Rata Share" means, with respect to
any Tranche C Term Lender the percentage obtained by dividing (i) the amount of
such Tranche C Term Lender's Term Loan Commitment designated as a Tranche C
Term Loan Commitment by (ii) the aggregate amount of all of the Term Loan
Commitments designated as Tranche C Term Loan Commitments.
"Tranche C Term Loan Termination Date" means the earlier of
(i) August 1, 2002 and (ii) the date of acceleration of the Obligations
pursuant to Section 12.02.
"Transaction Costs" means the fees, costs and expenses payable
by the Borrowers in connection with the execution, delivery and performance of
the Loan Documents.
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"Uniform Commercial Code" means the Uniform Commercial Code as
enacted in the State of New York, as it may be amended from time to time.
"Unused Commitment Fee" means, as of any date of
determination, a per annum rate equal to the rate set forth below opposite the
then applicable Performance Level set forth below:
Performance Level Per Annum Rate
----------------- --------------
▇▇▇▇▇ ▇ 0.350%
▇▇▇▇▇ ▇ 0.375%
▇▇▇▇▇ ▇ 0.400%
▇▇▇▇▇ ▇ 0.500%
▇▇▇▇▇ ▇ 0.500%
▇▇▇▇▇ ▇ 0.500%
Notwithstanding the foregoing, regardless of what Performance Level is then
applicable, during the period commencing on the Effective Date and ending on
July 1, 1997, the "Unused Commitment Fee" shall equal the rate of 0.55% per
annum.
"Unused Revolving Credit Facility" means, at any time of
determination, the excess of (i) the Revolving Credit Commitments at such time
over (ii) the sum of the aggregate principal amount of all Revolving Loans
outstanding at such time, plus the Letter of Credit Obligations at such time,
plus the aggregate principal amount of all Swing Loans outstanding at such
time, plus the aggregate Pending Revolving Loans at such time.
"Utah Distribution Center" means that certain facility located
at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇, together with all
improvements, fixtures and Equipment of Banner Distribution, Inc. located
thereon, owned and operated by Banner Distribution, Inc., a Delaware
corporation and Wholly-Owned Subsidiary of Banner, and used as a distribution
center for Inventory of the Borrowers and certain of their Subsidiaries.
"Wholly-Owned Subsidiary" means a corporation (i) one hundred
percent (100%) of the Capital Stock of which is owned by a Borrower or any
Subsidiary of a Borrower or (ii) greater than ninety-eight percent (98%) of the
Capital Stock of which is owned by a Borrower or a Subsidiary of a Borrower and
the remainder of which Capital Stock is owned by a nominee of such Borrower or
such Subsidiary solely to comply with the Requirements of Law of the
jurisdiction governing such corporation's organization and existence.
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"Working Capital" means, as at any date of determination, the
excess, if any, of (i) Banner's consolidated current assets (excluding cash and
Cash Equivalents, non-trade receivables, income tax accounts, and net assets
held for sale) as of such date over (ii) Banner's consolidated current
liabilities (excluding current maturities of long-term debt and the Revolving
Credit Obligations, all accrued interest, income tax accounts, short-term debt,
and bank overdrafts) as of such date.
1.02. Computation of Time Periods. In this Agreement, in
the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each mean "to but excluding". Periods of days referred to in this Agreement
shall be counted in calendar days unless Business Days are expressly
prescribed. Any period determined hereunder by reference to a month or months
or year or years shall end on the day in the relevant calendar month in the
relevant year, if applicable, immediately preceding the date numerically
corresponding to the first day of such period; provided that if such period
commences on the last day of a calendar month (or on a day for which there is
no numerically corresponding day in the calendar month during which such period
is to end), such period shall, unless otherwise expressly required by the other
provisions of this Agreement, end on the last day of the calendar month.
1.03. Accounting Terms. Subject to Section 15.04, for
purposes of this Agreement, all accounting terms not otherwise defined herein
shall have the meanings assigned to them in conformity with GAAP.
1.04. Other Terms. All other terms contained in this
Agreement shall, unless the context indicates otherwise, have the meanings
assigned to such terms by the Uniform Commercial Code to the extent the same
are defined therein.
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ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Term Loans; Tranche B Term Loans; Tranche C Term Loans.
(a) Amount of Loans. (i) The principal balance of the "Term Loans" made under
the 1995 Credit Agreement (each individually a "Term Loan" and collectively the
"Term Loans") and outstanding on the Effective Date is $48,000,000, which Term
Loans shall continue outstanding hereunder and be governed by the terms and
provisions of this Agreement. The principal balance of the "Tranche B Term
Loans" made under the July 1996 Credit Agreement (each individually a "Tranche
B Term Loan" and collectively the "Tranche B Term Loans") and outstanding on
the Effective Date is $30,000,000, which Tranche B Term Loans shall continue
outstanding hereunder and be governed by the terms and provisions of this
Agreement.
(ii) Subject to the terms and conditions set forth in this
Agreement, each Tranche C Lender hereby severally and not jointly agrees to
make on the Funding Date requested in a Notice of Borrowing submitted pursuant
to Section 2.01(b), a term loan, in Dollars, to the Borrowers, as joint and
several obligors, in an amount equal to such Lender's Tranche C Term Loan
Commitment (each individually, a "Tranche C Term Loan" and, collectively, the
"Tranche C Term Loans"). All Tranche C Term Loans shall be made by the Tranche
C Term Lenders on such Funding Date simultaneously and proportionately to
their respective Tranche C Term Loan Pro Rata Shares, it being understood that
no Lender shall be responsible for any failure by any other Lender to perform
its obligation to make any Tranche C Term Loan hereunder nor shall the Term
Loan Commitment of any Lender be increased or decreased as a result of any such
failure.
(b) Notice of Borrowing. The Borrowers shall deliver to
the Administrative Agent a Notice of Borrowing with respect to the Tranche C
Term Loans, signed by Banner, no later than (i) 11:00 a.m. (New York time) on
the proposed Funding Date therefor, in the case of a Borrowing of Base Rate
Loans, and (ii) 12:00 noon (New York time) at least three (3) Business Days in
advance of the proposed Funding Date therefor, in the case of a Borrowing of
Eurodollar Rate Loans. Such Notice of Borrowing shall specify (i) the
aggregate amount of the Tranche C Term Loans, (ii) the proposed Funding Date
therefor, which shall be a Business Day occurring no later than the thirtieth
(30th) calendar day after the Preferred Stock Issue Date, and (iii)
instructions for the disbursement of the proceeds of the Tranche C Term Loans.
Any Notice of Borrowing given pursuant to this Section 2.01(b) shall be
irrevocable.
(c) Making of Tranche C Term Loans. Promptly after
receipt of the Notice of Borrowing under Section 2.01(b) in respect of the
Tranche C Term Loans, the Administrative Agent
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shall notify each Tranche C Term Lender by facsimile transmission, or other
similar form of transmission, of the proposed Borrowing. Each Tranche C Term
Lender shall deposit an amount equal to its Tranche C Term Loan Pro Rata Share
of the Tranche C Term Loans with the Administrative Agent at its office in New
York, New York, in immediately available funds, on the Funding Date therefor.
Subject to the fulfillment of the conditions precedent set forth in Section
6.01, the Administrative Agent shall make the proceeds of such amounts received
by it available to the Borrowers at the Administrative Agent's office in New
York, New York on the Funding Date therefor and shall disburse such proceeds in
accordance with the Borrowers' disbursement instructions set forth in such
Notice of Borrowing. The failure of any Tranche C Term Lender to deposit the
amount described above with the Administrative Agent on the Funding Date
therefor shall not relieve any other Tranche C Term Lender of its obligations
hereunder to make its Tranche C Term Loan on the Funding Date therefor. In the
event the conditions precedent set forth in Section 6.01 are not fulfilled or
duly waived as of the Funding Date, the Administrative Agent shall promptly
return, by wire transfer of immediately available funds, the amount deposited
by each Tranche C Term Lender to such Tranche C Term Lender.
(d) Repayment of the Term Loans, Tranche B Term Loans and
Tranche C Term Loans. (i) The outstanding balance of the Term Loans on the
Effective Date shall be repayable in ten (10) consecutive semi-annual
installments due on February 1 and August 1 in each calendar year commencing on
February 1, 1997 with a final payment on August 1, 2001 as provided in the
Notes evidencing the same, unless the Term Loan Termination Date earlier
occurs. The Term Loan Commitments shall be permanently reduced by the amount of
each installment on the date payment thereof is required to be made hereunder.
The aggregate payments due hereafter with respect to each installment of the
Term Loans shall be in the respective amounts set forth in the following
schedule:
Installment Due Date Aggregate Installment
-------------------- ---------------------
February 1, 1997 $3,500,000
August 1, 1997 $3,500,000
February 1, 1998 $4,000,000
August 1, 1998 $4,000,000
February 1, 1999 $4,500,000
August 1, 1999 $4,500,000
February 1, 2000 $4,500,000
August 1, 2000 $4,500,000
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February 1, 2001 $7,500,000
August 1, 2001 $7,500,000
(ii) The Tranche B Term Loans shall be repayable in fourteen
(14) consecutive semi-annual installments due on February 1 and August 1 in
each calendar year commencing on February 1, 1997 with a final payment on June
30, 2003, unless the Tranche B Term Loan Termination Date earlier occurs. The
Term Loan Commitments shall be permanently reduced by the amount of each
installment on the date payment thereof is required to be made hereunder. The
aggregate payments due with respect to each of the first thirteen (13)
installments of the Tranche B Term Loans shall be in the amount of $150,000
with a final installment in the amount of $28,050,000 due on June 30, 2003.
(iii) The Tranche C Term Loans shall be repayable in eleven
(11) consecutive semi-annual installments due on February 1 and August 1 in
each calendar year commencing on August 1, 1997 with a final payment on August
1, 2002, unless the Tranche C Term Loan Termination Date earlier occurs. The
Term Loan Commitments shall be permanently reduced by the amount of each
installment on the date payment thereof is required to be made hereunder. The
aggregate payments due with respect to each of the first ten (10) installments
of the Tranche C Term Loans shall be in the amount of $200,000 with a final
installment in the amount of $38,000,000 due on August 1, 2002.
(iv) In addition to the scheduled payments on the Term Loans,
Tranche B Term Loans and Tranche C Term Loans, the Borrowers may make voluntary
prepayments as and when described in Section 4.01(a)(i) and shall make the
mandatory prepayments required in Section 4.01(b), for credit against such
scheduled payments on the Term Loans, Tranche B Term Loans and Tranche C Term
Loans pursuant to the provisions of Section 4.01(a)(i) or Section 4.01(b)(v),
as applicable.
2.02. Revolving Credit Facility. (a) Availability. (i)
Subject to the terms and conditions set forth in this Agreement, each Revolving
Lender hereby severally and not jointly agrees to make revolving loans, in
Dollars (each individually, a "Revolving Loan" and, collectively, the
"Revolving Loans") to the Borrowers, as joint and several obligors, from time
to time during the period from the Closing Date to the Business Day next
preceding the Revolving Credit Termination Date, in an amount not to exceed
such Lender's Revolving Loan Pro Rata Share of the Revolving Credit
Availability at such time. All Revolving Loans comprising the same Borrowing
under this Agreement shall be made by the Revolving Lenders simultaneously and
proportionately to their then respective Revolving Loan Pro Rata Shares, it
being understood that no Lender shall be responsible for any failure by any
other Lender to perform its obligation to make a Revolving Loan hereunder nor
shall the Revolving Credit Commitment of any
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Lender be increased or decreased as a result of any such failure. Subject to
the provisions of this Agreement, the Borrowers may repay any outstanding
Revolving Loan on any day which is a Business Day and any amounts so repaid may
be reborrowed, up to the amount available under this Section 2.02(a) at the
time of such Borrowing, until the Business Day next preceding the Revolving
Credit Termination Date. Each requested Borrowing of Revolving Loans funded
on any Funding Date for Revolving Loans shall be (a) if Base Rate Loans, in a
principal amount of at least $100,000 and in integral multiples of $100,000 in
excess of that amount and (b) if Eurodollar Rate Loans, in a principal amount
of at least $1,000,000 and in integral multiples of $100,000 in excess of that
amount.
(ii) In the event the Revolving Credit Availability is less
than zero, the Borrowers shall, without notice or demand of any kind,
immediately make such repayments of the Protective Advances then outstanding,
Swing Loans and Revolving Loans to the extent necessary to reduce the aggregate
outstanding principal amount thereof to result in the Revolving Credit
Availability equalling at least zero.
(b) Notice of Borrowing. When the Borrowers desire to borrow
under this Section 2.02, they shall deliver to the Administrative Agent a
Notice of Borrowing, signed by it, (i) on the Effective Date, in the case of a
Borrowing of Revolving Loans on the Effective Date, (ii) no later than 11:00
a.m. (New York time) on the proposed Funding Date therefor, in the case of a
Borrowing of Base Rate Loans after the Effective Date, and (iii) no later than
12:00 noon (New York time) at least three (3) Business Days in advance of the
proposed Funding Date therefor, in the case of a Borrowing of Eurodollar Rate
Loans. Such Notice of Borrowing shall specify (i) the proposed Funding Date
(which shall be a Business Day), (ii) the amount of the proposed Borrowing,
(iii) the Revolving Credit Availability as of the date of such Notice of
Borrowing, (iv) whether the proposed Borrowing will be of Base Rate Loans or
Eurodollar Rate Loans, (v) in the case of Eurodollar Rate Loans, the requested
Eurodollar Interest Period and (vi) the Borrowers' instructions for the
disbursement of the proceeds of the proposed Borrowing. In lieu of delivering
such a Notice of Borrowing (except with respect to a Borrowing of Revolving
Loans on the Effective Date), the Borrowers may give the Administrative Agent
telephonic notice of any proposed Borrowing by the time required under this
Section 2.02(b), if the Borrowers confirm such notice by delivery of the
required Notice of Borrowing to the Administrative Agent by facsimile
transmission promptly, but in no event later than 5:00 p.m. (New York time) on
the same day, the original of which facsimile copy shall be delivered to the
Administrative Agent within three (3) days after the date of such transmission.
Any Notice of Borrowing (or telephonic notice in lieu thereof) given pursuant
to this Section 2.02(b) shall be irrevocable.
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(c) Making of Revolving Loans. (i) Promptly after receipt
of a Notice of Borrowing under Section 2.02(b) (or telephonic notice in lieu
thereof), the Administrative Agent shall notify each Lender by telex or
telecopy, or other similar form of transmission, of the proposed Borrowing.
Each Revolving Lender shall deposit an amount equal to its Revolving Loan Pro
Rata Share of the amount requested by the Borrowers to be made as Revolving
Loans with the Administrative Agent at its office in New York, New York, in
immediately available funds, (A) on the Effective Date with respect to the
Borrowing of Revolving Loans on such date specified in the initial Notice of
Borrowing and (B) not later than 12:00 noon (New York time) on any other
Funding Date for Revolving Loans. Subject to the fulfillment of the conditions
precedent set forth in Section 6.01 or Section 6.02, as applicable, the
Administrative Agent shall make the proceeds of such amounts received by it
available to the Borrowers at the Administrative Agent's office in New York,
New York on such Funding Date (or on the date received if later than such
Funding Date) and shall disburse such proceeds in accordance with the
Borrowers' disbursement instructions set forth in the applicable Notice of
Borrowing. The failure of any Revolving Lender to deposit the amount described
above with the Administrative Agent on the applicable Funding Date shall not
relieve any other Revolving Lender of its obligations hereunder to make its
Revolving Loan on such Funding Date. In the event the conditions precedent set
forth in Section 6.01 or 6.02, as applicable, are not fulfilled as of the
proposed Funding Date for any Borrowing, the Administrative Agent shall
promptly return, by wire transfer of immediately available funds, the amount
deposited by each Revolving Lender to such Lender.
(ii) Unless the Administrative Agent shall have been notified
by any Revolving Lender on the Business Day immediately preceding the
applicable Funding Date in respect of any Borrowing of Revolving Loans that
such Lender does not intend to fund its Revolving Loan requested to be made on
such Funding Date, the Administrative Agent may assume that such Lender has
funded its Revolving Loan and is depositing the proceeds thereof with the
Administrative Agent on the Funding Date therefor, and the Administrative Agent
in its sole discretion may, but shall not be obligated to, disburse a
corresponding amount to the Borrowers on the applicable Funding Date. If the
Revolving Loan proceeds corresponding to that amount are advanced to the
Borrowers by the Administrative Agent but are not in fact deposited with the
Administrative Agent by such Lender on or prior to the applicable Funding Date,
such Lender agrees to pay, and in addition the Borrowers jointly and severally
agree to repay, to the Administrative Agent forthwith on demand such
corresponding amount, together with interest thereon, for each day from the
date such amount is disbursed to or for the benefit of the Borrowers until the
date such amount is paid or repaid to the Administrative Agent, (A) in the case
of the Borrowers, at the
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interest rate applicable to such Borrowing and (B) in the case of such Lender,
at the Federal Funds Rate for the first three (3) Business Days, and thereafter
at the interest rate applicable to such Borrowing. If such Lender shall pay to
the Administrative Agent the corresponding amount, the amount so paid shall
constitute such Lender's Revolving Loan, and if both such Lender and the
Borrowers shall pay and repay such corresponding amount, the Administrative
Agent shall promptly pay to the Borrowers such corresponding amount. This
Section 2.02(c)(ii) does not relieve any Revolving Lender of its obligation to
make its Revolving Loan on any applicable Funding Date.
(d) Revolving Credit Termination Date. The Revolving
Credit Commitments shall terminate on the Revolving Credit Termination Date.
Each Revolving Lender's obligation to make Revolving Loans shall terminate on
the Business Day next preceding the Revolving Credit Termination Date. All
outstanding Revolving Credit Obligations with respect to issued Letters of
Credit shall be paid in full (or, in the case of unmatured Letter of Credit
Obligations with respect to issued Letters of Credit, provision for payment in
cash shall be made to the satisfaction of the applicable Issuing Banks and the
Requisite Lenders) (i) if the Revolving Credit Commitments are terminated
pursuant to Section 4.01, on the Revolving Credit Termination Date, and (ii)
otherwise, on the earlier to occur of (A) August 1, 2001 or, if not a Business
Day, the next preceding Business Day, and (B) the date of acceleration of the
Obligations pursuant to Section 12.02.
2.03. Swing Loans. (a) Amount. Subject to the terms and
conditions set forth in this Agreement, the Swing Lender, in its sole
discretion, may from time to time after the Closing Date make loans to the
Borrowers solely for the Swing Lender's own account (the "Swing Loans") up to
an aggregate principal amount at any one time outstanding equal to the least of
(i) the Swing Loan Subfacility, (ii) the Revolving Credit Commitments then in
effect and (iii) the Revolving Credit Availability as of the time such Swing
Loans are requested (such least amount being referred to as the "Swing Loan
Availability"). All Swing Loans shall be payable, together with accrued
interest thereon, on the Swing Lender's demand therefor.
(b) Notice of Borrowing. When Borrowers desire to borrow
under this Section 2.03, they shall make a telephonic request to the
Administrative Agent (which shall be confirmed by a Notice of Borrowing, signed
on its behalf, delivered to the Administrative Agent on the same day by
facsimile transmission) no later than 3:00 p.m. (New York time). If a Swing
Loan is made, it shall be made on the date of such Notice of Borrowing and such
Notice of Borrowing shall specify (i) the amount of the proposed Borrowing,
(ii) the Swing Loan Availability as of the date of
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such Notice of Borrowing, and (iii) instructions for the disbursement of the
proceeds of such proposed Borrowing.
(c) Making of Swing Loans. The Swing Lender shall have no
duty to make or to continue to make Swing Loans at any time. In the event the
Swing Lender determines to make any Swing Loan after Borrowers' request
therefor, the Swing Lender shall make the proceeds of such Swing Loan available
to the Borrowers at the Administrative Agent's office in New York, New York and
shall disburse such proceeds in accordance with the Borrowers' disbursement
instructions set forth in the applicable Notice of Borrowing. The Swing Lender
shall not make any Swing Loan at any time if Swing Lender shall have received a
written notice from any Lender or shall otherwise have actual knowledge before
funding such Swing Loan that one or more of the conditions precedent set forth
in Section 6.02 will not be satisfied on the proposed Funding Date for such
Swing Loan, but the Swing Lender shall not otherwise be required to take any
action to determine that the conditions precedent set forth in Section 6.02
have been satisfied prior to making any Swing Loan.
(d) Repayment of Swing Loans. (i) On the Business Day
immediately following the receipt of proceeds of a Swing Loan, the Borrowers
shall promptly deliver a Notice of Borrowing to the Administrative Agent
requesting Revolving Loans (which shall initially be Base Rate Loans) pursuant
to Section 2.02(b) in an amount equal to the amount of such Swing Loan and
hereby authorizes the Administrative Agent to apply the proceeds of such
Revolving Loans to the repayment of such Swing Loan; provided, however, that
Borrowers shall not be required to deliver such Notice of Borrowing in the
event such Swing Loan has been repaid in full prior to the time a Notice of
Borrowing is required hereunder.
(ii) In the event that Borrowers shall have failed to repay
any such Swing Loan within two (2) Business Days after the date such Swing Loan
was made, the Swing Lender shall promptly demand payment thereof, and if such
Swing Loan remains unpaid one (1) Business Day after such demand, and in any
event upon request by such Swing Lender to the Administrative Agent and upon
the Revolving Credit Termination Date, each Revolving Lender shall irrevocably
and unconditionally purchase from such Swing Lender, without recourse or
warranty, an undivided interest and participation in such Swing Loan to the
extent of such Revolving Lender's Revolving Loan Pro Rata Share thereof. The
aforesaid request by the Swing Lender shall be made by written notice to the
Administrative Agent (which may be delivered by facsimile transmission) or
telephone to the Administrative Agent (with written confirmation thereof by
facsimile transmission), which notice shall specify a proposed purchase date
and be delivered to the Administrative Agent no later than 12:00 noon at least
one (1) Business Day in advance of such proposed purchase date.
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Promptly after receipt of such notice, the Administrative Agent shall notify
the Revolving Lenders of the requested purchase and each Revolving Lender shall
deposit an amount equal to its Revolving Loan Pro Rata Share of the applicable
Swing Loan with the Administrative Agent at its office in New York, New York,
in immediately available funds not later than 10:00 a.m. (New York time) on the
proposed purchase date. The Administrative Agent shall thereupon (regardless of
whether the conditions precedent set forth in Section 6.02 are then satisfied)
remit such amount to the Swing Lender at the Administrative Agent's office in
New York, New York in immediately available funds. If such amount is not made
available by any Revolving Lender to the Administrative Agent for remittance to
the Swing Lender as described above, the Swing Lender shall be entitled to
recover such amount on demand from such Revolving Lender, together with accrued
interest thereon, for each day from the date of demand, at the Federal Funds
Rate for the first three (3) days following the date such amount was due and
thereafter at the Base Rate. The failure of any Revolving Lender to pay such
amount to the Swing Lender shall not relieve any other Revolving Lender of its
obligation to make the payment to be made by it. Upon the purchase of a
Revolving Lender of a participation in any Swing Loan pursuant to this Section
2.03(d), such Revolving Lender shall be deemed to have made a Revolving Loan in
the amount of such participation, and such Swing Loan shall be deemed to have
been repaid in such amount.
(iii) Notwithstanding anything to the contrary in this
Section 2.03, Borrowers shall, whether or not the Swing Lender shall have made
demand therefor, on the Revolving Credit Termination Date repay in full the
principal amount of the Swing Loans then outstanding together with interest
thereon.
(e) Use of Proceeds of Swing Loans. The proceeds of the
Swing Loans may be used solely for working capital in the ordinary course of
business of the Borrowers and their Subsidiaries.
2.04. Authorized Officers and Agents. On the Effective Date
the Borrowers shall deliver, and from time to time thereafter the Borrowers may
deliver, to the Administrative Agent an Officer's Certificate setting forth the
names of the officers, employees and agents authorized to request Loans and
Letters of Credit and to request a conversion/continuation of any Loan, in each
instance containing a specimen signature of each such officer, employee or
agent. The officers, employees and agents so authorized shall also be
authorized to act for the Borrowers in respect of all other matters relating to
the Loan Documents. The Administrative Agent, Co-Agents, Lenders and Issuing
Banks shall be entitled to rely conclusively on such officer's, employee's, or
agent's authority to request such Loan or Letter of Credit or such
conversion/continuation until the
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Administrative Agent, Co-Agents, Lenders and Issuing Banks receive written
notice to the contrary. None of the Administrative Agent, the Co-Agents, the
Lenders, or the Issuing Banks shall have any duty to verify the authenticity of
the signature appearing on any such Officer's Certificate, written Notice of
Borrowing or Notice of Conversion/Continuation, or any other document, and,
with respect to an oral request for such a Loan or Letter of Credit or such
conversion/continuation, the Administrative Agent shall have no duty to verify
the identity of any person representing himself or herself as one of the
officers, employees or agents authorized to make such request or otherwise to
act on behalf of the Borrowers. None of the Administrative Agent, any
Co-Agent, any Lender or the Issuing Banks shall incur any liability to either
Borrower or any other Person in acting upon any telephonic or facsimile notice
referred to above which the Administrative Agent, such Co-Agent, such Lender,
or such Issuing Bank believes to have been given by a duly authorized officer
or other Person authorized to borrow on behalf of the Borrowers. Each Borrower
acknowledges that disbursements of proceeds of Loans made in conformance with a
Notice of Borrowing executed by such an authorized officer or other Person
authorized to borrow on behalf of the Borrowers shall constitute value to the
Borrowers.
2.05. Use of Proceeds of Loans. The proceeds of the Loans
made under this Agreement shall be used for working capital in the ordinary
course of the Borrowers' and their Subsidiaries' businesses, for Capital
Expenditures and Permitted Acquisitions permitted to be made under the terms of
this Agreement, for repayment of Swing Loans as provided in Section 2.03(d),
and for other lawful general corporate purposes.
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ARTICLE III
LETTERS OF CREDIT
3.01. Letters of Credit. Subject to the terms and conditions
set forth in this Agreement, each Issuing Bank hereby severally agrees to issue
for the account of the Borrowers, or for the account of any of the Borrowers'
Subsidiaries if the Borrowers are jointly and severally liable for
reimbursement of amounts drawn under such Letter of Credit, one or more Letters
of Credit, subject to the following provisions:
(a) Types and Amounts. No Issuing Bank shall have any
obligation to issue, amend or extend, or shall issue, amend or extend, any
Letter of Credit at any time:
(i) if the aggregate Letter of Credit Obligations with
respect to such Issuing Bank, after giving effect to the issuance,
amendment or extension of the Letter of Credit requested hereunder,
shall exceed any limit imposed by law or regulation upon such Issuing
Bank;
(ii) if such Issuing Bank receives written notice from the
Administrative Agent at or before 11:00 a.m. (New York time) on the
date of the proposed issuance, amendment or extension of such Letter
of Credit that (A) immediately after giving effect to the issuance,
amendment or extension of such Letter of Credit, (I) the Letter of
Credit Obligations at such time would exceed $5,000,000 or (II) the
Revolving Credit Availability at such time would be less than zero, or
(B) one or more of the conditions precedent contained in Sections 6.01
or 6.02, as applicable, would not on such date be satisfied, unless
such conditions are thereafter satisfied and written notice of such
satisfaction is given to the Issuing Banks by the Administrative Agent
(and the Issuing Banks shall not otherwise be required to determine
that, or take notice whether, the conditions precedent set forth in
Sections 6.01 or 6.02, as applicable, have been satisfied);
(iii) which has an expiration date later than the earlier of
(A) the date one (1) year after the date of issuance (without regard
to any automatic renewal pro visions thereof) or (B) the Business Day
next preceding the scheduled Revolving Credit Termination Date;
(iv) which is in a currency other than a currency in which
such Issuing Bank is then issuing letters of credit; or
(v) if the aggregate Dollar equivalent of the face amount of
Letters of Credit issued in a currency other than
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Dollars, after giving effect to the issuance, amendment or extension
of the requested Letter of Credit would exceed $5,000,000.
For purposes of the Dollar limitations set forth in clause (ii) above, all
calculations thereof shall be determined, with respect to Letters of Credit
denominated in a currency other than Dollars based on the Dollar equivalent of
such currency at the exchange rate therefor as in effect on the date of
determination.
(b) Conditions. In addition to being subject to the
satisfaction of the conditions precedent contained in Sections 6.01 and 6.02,
as applicable, the obligation of a given Issuing Bank to issue, amend or extend
any Letter of Credit is subject to the satisfaction in full of the following
conditions:
(i) if such Issuing Bank so requests, the Borrowers or,
in the case of Letters of Credit issued for the account of any
Subsidiary of a Borrower, the Borrowers and such Subsidiary shall have
executed and delivered to such Issuing Bank and the Administrative
Agent a Letter of Credit Reimbursement Agreement and such other
documents and materials as may be required pursuant to the terms
thereof; and
(ii) the terms of the proposed Letter of Credit shall be
satisfactory to such Issuing Bank in its sole discretion.
(c) Issuance and Extension of Letters of Credit. (i)
The Borrowers shall give the Issuing Banks and the Administrative Agent written
notice that it has selected an Issuing Bank to issue a Letter of Credit, and,
if applicable, that it desires to extend the expiry date of or otherwise amend
a Letter of Credit, which notice shall be delivered not later than 11:00 a.m.
(New York time) on the second (2nd) Business Day preceding the requested date
for issuance, extension or amendment thereof under this Agreement, or such
shorter notice as may be acceptable to the Issuing Banks and the Administrative
Agent. Such notice shall be irrevocable unless and until such request is
denied by the Issuing Bank selected and shall specify with respect to Letters
of Credit to be issued:
(A) that the requested Letter of Credit is either a Commercial
Letter of Credit or a Standby Letter of Credit,
(B) that such Letter of Credit is solely for the account of
the Borrowers or the name of the Subsidiary of a Borrower which is
jointly and severally applying for such Letter of Credit,
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(C) the stated amount of the Letter of Credit requested in the
currency in which the Letter of Credit is to be issued,
(D) the effective date (which shall be a Business Day) of
issuance of such Letter of Credit,
(E) the date on which such Letter of Credit is to expire
(which shall be a Business Day and no later than the Business Day
immediately preceding the scheduled Revolving Credit Termination
Date),
(F) the Person for whose benefit such Letter of Credit is to
be issued,
(G) other relevant terms of such Letter of Credit,
(H) the Revolving Credit Availability at such time, and
(I) the amount of the then outstanding Letter of Credit
Obligations;
and, with respect to Letters of Credit to be amended or extended, as
applicable:
(A) the letter of credit reference number or other identifying
information with respect to such Letter of Credit,
(B) the date (which shall be a Business Day) of amendment or
extension of such Letter of Credit,
(C) the new expiry date of such Letter of Credit (which shall
be a Business Day no later than the Business Day immediately preceding
the scheduled Revolving Credit Termination Date),
(D) the relevant terms of the Letter of Credit to be amended,
and
(E) the amount, if any by which the Revolving Credit
Commitments at such time exceeds the Revolving Credit Obligations at
such time.
The applicable Issuing Bank shall notify the Administrative Agent immediately
upon receipt of a written notice from the Borrowers requesting that a Letter of
Credit be issued, or that an existing Letter of Credit be extended or amended
and, upon the Administrative Agent's request therefor, send a copy of such
notice to the Administrative Agent.
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(ii) The applicable Issuing Bank shall give (A) the
Administrative Agent written notice, or telephonic notice confirmed promptly
thereafter in writing, of the issuance, amendment or extension of a Letter of
Credit and (B) promptly after issuance thereof, provide the Administrative
Agent with a copy of each Letter of Credit issued and each amendment thereto.
(d) Reimbursement Obligations; Duties of the Issuing
Bank. (i) Notwithstanding any provisions to the contrary in any Letter of
Credit Reimbursement Agreement:
(A) the Borrowers shall reimburse, or cause the
Subsidiary for whose account a Letter of Credit is issued to
reimburse, the respective Issuing Bank for amounts drawn under such
Letter of Credit issued by it, in the currency in which such Letter of
Credit was issued, no later than the date (the "Reimbursement Date")
which is the earlier of (I) the time specified in the applicable
Letter of Credit Reimbursement Agreement and (II) one (1) Business Day
after the Borrowers (or either of them) receive written notice from
such Issuing Bank that payment has been made under such Letter of
Credit by such Issuing Bank; and
(B) all Reimbursement Obligations with respect to any
Letter of Credit shall bear interest at the rate applicable to Base
Rate Loans in accordance with Section 5.01(a) from the date of the
relevant drawing under such Letter of Credit until the Reimbursement
Date and thereafter at the rate applicable to Base Rate Loans in
accordance with Section 5.01(d).
(ii) The applicable Issuing Bank shall give the
Administrative Agent written notice, or telephonic notice confirmed promptly
thereafter in writing, of all drawings under a Letter of Credit issued by it
and the payment (or the failure to pay when due) by the Borrowers or the
applicable Subsidiary on account of a Reimbursement Obligation.
(iii) No action taken or omitted in good faith by an Issuing
Bank under or in connection with any Letter of Credit issued by it shall put
such Issuing Bank under any resulting liability to any Lender, the Borrowers or
any of their Subsidiaries or, so long as it is not issued in violation of
Section 3.01(a), relieve any Lender of its obligations hereunder to such Issuing
Bank, unless such action or omission amounts to gross negligence or wilfull
misconduct on the part of such Issuing Bank. Solely as between an Issuing Bank
and the Lenders, in determining whether to pay under any Letter of Credit, the
Issuing Bank having issued such Letter of Credit shall have no obligation to the
Lenders other than to confirm that any documents required to be delivered under
a respective Letter of
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Credit appear to have been delivered and that they appear on their face to
comply with the requirements of such Letter of Credit.
(e) Participations. (i) Immediately upon issuance by an
Issuing Bank of any Letter of Credit in accordance with the procedures set
forth in this Section 3.01 and immediately upon conversion of a letter of
credit of an Issuing Bank to a Letter of Credit pursuant to Section 3.02, each
Revolving Lender shall be deemed to have irrevocably and unconditionally
purchased and received from such Issuing Bank, without recourse or warranty, an
undivided interest and participation in such Letter of Credit to the extent of
such Lender's Revolving Loan Pro Rata Share, including, without limitation, all
obligations of the Borrowers and their Subsidiaries with respect thereto (other
than amounts owing to such Issuing Bank under Section 3.01(g)) and any security
therefor and guaranty pertaining thereto.
(ii) If an Issuing Bank makes any payment under any Letter of
Credit issued by it and the Borrowers or the Subsidiary for whose account the
Letter of Credit was issued does not repay such amount to such Issuing Bank on
the Reimbursement Date, such Issuing Bank shall promptly notify the
Administrative Agent, which shall promptly notify each Lender, and each
Revolving Lender shall promptly and unconditionally pay to the Administrative
Agent for the account of the Issuing Bank, in immediately available funds, the
amount of such Lender's Revolving Loan Pro Rata Share of such payment, and the
Administrative Agent shall promptly pay to such Issuing Bank such amounts
received by it, and any other amounts received by the Administrative Agent for
such Issuing Bank's account, pursuant to this Section 3.01(e). All amounts so
paid to Issuing Banks shall be deemed to constitute Revolving Loans. If a
Revolving Lender does not make its Revolving Loan Pro Rata Share of the amount
of such payment available to the Administrative Agent, such Lender agrees to
pay to the Administrative Agent for the account of the applicable Issuing Bank,
forthwith on demand, such amount together with interest thereon, for the first
three (3) Business Days after the date such payment was first due at the
Federal Funds Rate, and thereafter at the interest rate then applicable to Base
Rate Loans in accordance with Section 5.01(a). The failure of any Revolving
Lender to make available to the Administrative Agent for the account of such
Issuing Bank its Revolving Loan Pro Rata Share of any such payment shall
neither relieve any other Revolving Lender of its obligation hereunder to make
available to the Administrative Agent for the account of such Issuing Bank such
other Lender's Revolving Loan Pro Rata Share of any payment on the date such
payment is to be made nor increase the obligation of any other Lender to make
such payment to the Administrative Agent.
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(iii) Whenever an Issuing Bank receives a payment on account
of a Reimbursement Obligation, including any interest thereon, as to which the
Administrative Agent has previously received payments from any Lender for the
account of such Issuing Bank pursuant to this Section 3.01(e), such Issuing
Bank shall promptly pay to the Administrative Agent and the Administrative
Agent shall promptly pay to such Lender an amount equal to such Lender's
Revolving Loan Pro Rata Share of such payment. Each such payment shall be made
by an Issuing Bank or the Administrative Agent, as the case may be, on the
Business Day on which such Person receives the funds paid to such Person
pursuant to the preceding sentence, if received prior to 11:00 a.m. (New York
time) on such Business Day, and otherwise on the next succeeding Business Day.
(iv) Upon the request of any Revolving Lender, the Issuing
Banks shall furnish such Lender copies of any Letter of Credit or Letter of
Credit Reimbursement Agreement to which the Issuing Banks are a party and such
other documentation as reasonably may be requested by such Revolving Lender.
(v) The obligations of a Revolving Lender to make payments to
the Administrative Agent for the account of an Issuing Bank with respect to a
Letter of Credit, or of the Borrowers to pay the Reimbursement Obligations,
shall be irrevocable, shall not be subject to any qualification or exception
whatsoever except willful misconduct or gross negligence of such Issuing Bank,
and shall be honored in accordance with this Article III (irrespective of the
satisfaction of the conditions described in Sections 6.01 and 6.02, as
applicable) under all circumstances, including, without limitation, any of the
following circumstances:
(A) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(B) the existence of any claim, setoff, defense or other
right which either Borrower or a Subsidiary of either Borrower may
have at any time against a beneficiary named in a Letter of Credit or
any transferee of a beneficiary named in a Letter of Credit (or any
Person for whom any such transferee may be acting), the
Administrative Agent, any Co-Agent, any Issuing Bank, any Lender, or
any other Person, whether in connection with this Agreement, any
Letter of Credit, the transactions contemplated herein or any
unrelated transactions (including any underlying trans actions between
the account party and beneficiary named in any Letter of Credit);
(C) any draft, certificate or any other document
presented under the Letter of Credit having been
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determined to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect;
(D) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents;
(E) any failure by any Issuing Bank to make any reports
required pursuant to Section 3.01(d)(ii) or the inaccuracy of any such
report; or
(F) the occurrence of any Event of Default or Potential
Event of Default or termination of the Commitments.
(f) Payment of Reimbursement Obligations. (i) The
Borrowers jointly and severally unconditionally agree to pay, or cause the
Subsidiary for whose account a Letter of Credit is issued to pay, to the
Issuing Bank issuing such Letter of Credit, the amount of all Reimbursement
Obligations, interest and other amounts payable to such Issuing Bank under or
in connection with such Letters of Credit when such amounts are due and
payable, irrespective of any claim, setoff, defense or other right which either
Borrower or any such Subsidiary may have at any time against an Issuing Bank or
any other Person.
(ii) In the event any payment by the Borrowers (or either
of them) or such Subsidiary received by an Issuing Bank with respect to a
Letter of Credit and distributed by the Administrative Agent to the Revolving
Lenders on account of their participations therein is thereafter set aside,
avoided or recovered from such Issuing Bank in connection with any receiver
ship, liquidation or bankruptcy proceeding, each Revolving Lender which
received such distribution shall, upon demand by such Issuing Bank, contribute
such Lender's Revolving Loan Pro Rata Share of the amount set aside, avoided or
recovered together with interest at the rate required to be paid by such
Issuing Bank upon the amount required to be repaid by it.
(iii) All payments of Reimbursement Obligations, (A) if made
to or for the account of an Issuing Bank, shall be made in the currency in
which the related Letter of Credit was issued and (B) if made to or for the
account of the Revolving Lenders, shall be made in the then Dollar equivalent
of the Reimbursement Obligation.
(g) Issuing Bank Charges. The Borrowers shall pay, or
cause the Subsidiary for whose account a Letter of Credit is issued to pay, to
the Issuing Bank issuing such Letter of Credit, solely for its own account, the
standard charges assessed by such Issuing Bank in connection with the issuance,
administration,
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amendment and payment or cancellation of Letters of Credit and such
compensation in respect of such Letters of Credit for the Borrowers' or such
Subsidiary's account, as applicable, as may be agreed upon by the Borrowers and
such Issuing Bank from time to time.
(h) Indemnification; Exoneration. (i) In addition to
all other amounts payable to the Issuing Banks, the Borrowers hereby jointly
and severally agree to defend, indemnify, and save the Administrative Agent,
the Co-Agents, each Issuing Bank and each Lender harmless from and against any
and all claims, demands, liabilities, penalties, damages, losses (other than
loss of profits), costs, charges and expenses (including reasonable attorneys'
fees but excluding taxes) which the Administrative Agent, Co-Agents, such
Issuing Bank or such Lender may incur or be subject to as a consequence, direct
or indirect, of (A) the issuance of any Letter of Credit other than as a result
of the gross negligence or willful misconduct of an Issuing Bank, as determined
by a court of competent jurisdiction, or (B) the failure of the Issuing Bank
issuing a Letter of Credit to honor a drawing under such 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.
(ii) As between the Borrowers and any of their
Subsidiaries for whose account a Letter of Credit is issued on the one hand and
the Administrative Agent, the Co-Agents, the Lenders and the Issuing Banks on
the other hand, the Borrowers assume all risks of the acts and omissions of, or
misuse of Letters of Credit by, the respective beneficiaries of the Letters of
Credit. In furtherance and not in limitation of the foregoing, subject to the
provisions of the Letter of Credit Reimbursement Agreements, no Issuing Bank,
Lender, or Co-Agent, nor the Administrative Agent, shall be responsible for:
(A) the form, validity, legality, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in connection with the
application for and issuance of the Letters 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, legality or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any reason;
(C) failure of the beneficiary of a Letter of Credit to comply duly with
conditions required in order to draw upon such 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 document required in order to make a
drawing under any Letter of Credit or of the proceeds thereof; (G) the
misapplication by the
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beneficiary of a Letter of Credit of the proceeds of any drawing under such
Letter of Credit; and (H) any consequences arising from causes beyond the
control of the Administrative Agent, the Co-Agents, the Issuing Banks or the
Lenders.
3.02. Transitional Provisions. SCHEDULE 3.02 contains a
schedule of certain letters of credit issued prior to the Closing Date by
Citibank for the account of a Borrower or for the account of a Subsidiary of a
Borrower with respect to which a Borrower is jointly and severally liable for
reimbursement of amounts drawn under such letter of credit. Such letters of
credit automatically on the Closing Date, and without further action of the
parties thereto, shall be converted into Letters of Credit and be deemed issued
pursuant to this Section 3.02 and subject to the provisions hereof other than
the provisions of Section 5.03(a) pertaining to the payment of a Fronting Fee
upon issuance. The undrawn face amount of such letters of credit have been
included in the calculation of Letter of Credit Obligations and all liabilities
of the Borrowers with respect to such letters of credit constitute Obligations.
3.03. Obligations Several. The obligations of each Issuing
Bank and Revolving Lender under this Article III are several and not joint, and
neither shall any Issuing Bank be responsible for the obligation of any Lender
to participate in Letters of Credit issued hereunder nor shall any Lender be
responsible for the obligation of any Issuing Bank to issue Letters of Credit
hereunder or for the obligation of any other Lender to participate in Letters
of Credit issued hereunder.
3.04. Multicurrency Provisions. Borrowers shall at all
times bear the risk of fluctuations in the exchange rate with respect to
Letters of Credit issued in currencies other than Dollars. For purposes of
determination of the Letter of Credit Obligations with respect to such Letters
of Credit, the Dollar equivalent of the currency in which any non-Dollar Letter
of Credit is issued shall be determined as of the date of issuance, amendment,
extension or renewal thereof, the date on which the Reimbursement Obligation
with respect thereto is due, and the date on which any judgment is entered by a
court of competent jurisdiction with respect thereto. In the event of a
fluctuation in the exchange rate applicable to any Reimbursement Obligation
which is to be paid to Revolving Lenders, the Borrowers shall pay, on the
Administrative Agent's demand therefor, the amount of any difference between
the exchange rate applicable to the subject Letter of Credit as of the then
most recent date of issuance, amendment, extension or renewal and the exchange
rate applicable as of the date on which the Reimbursement Obligation with
respect thereto is due or the date on which a judgment is issued as aforesaid
and the Administrative Agent shall remit such amount to the Revolving Lenders.
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3.05. Nature of Duties; Revolving Lender Indemnification.
Except to the extent expressly set forth in this Agreement or in the other Loan
Documents to which it is a party, no Issuing Bank shall have any duties or
responsibilities to the Borrowers, their Subsidiaries, or the Lenders or
Administrative Agent nor any fiduciary relationship in respect of any such
Persons. To the extent any Issuing Bank is required to be indemnified by the
Borrowers but is not so indemnified, the Revolving Lenders will indemnify such
Issuing Bank therefor in proportion to each Revolving Lender's Revolving Loan
Pro Rata Share.
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ARTICLE IV
PAYMENTS AND PREPAYMENTS
4.01. Prepayments; Reductions in Commitments.
(a) Voluntary Prepayments/Reductions. (i) Notice. The
Borrowers may, upon at least three (3) Business Days' prior written notice to
the Administrative Agent (which the Administrative Agent shall promptly
transmit to each Lender), at any time and from time to time, prepay the Term
Loans, the Tranche B Term Loans and the Tranche C Term Loans which are Base
Rate Loans, in whole or in part. Term Loans, Tranche B Term Loans and Tranche
C Term Loans which are Eurodollar Rate Loans may be prepaid in whole or in part
upon at least three (3) Business Days' prior written notice to the
Administrative Agent (which the Administrative Agent shall promptly transmit to
each Lender), (A) on the expiration date of the then applicable Eurodollar
Interest Period therefor, and (B) on any other date upon payment of the amounts
described in Section 5.02(f) and Section 14.05. The Borrowers may, upon prior
written notice to the Administrative Agent by 11:00 a.m. (New York time) on the
proposed prepayment date, at any time and from time to time, prepay Revolving
Loans and Swing Loans in whole or in part, without premium or penalty (except
as provided in Article XIV), and if such prepayment is a partial prepayment, in
an aggregate amount of $100,000 and integral multiples of $100,000 in excess of
that amount. Any notice of prepayment given to the Administrative Agent under
this Section 4.01(a)(i) shall specify the date (which shall be a Business Day)
of prepayment, the aggregate principal amount of the prepayment and any
allocation of such amount among Base Rate Loans and Eurodollar Rate Loans. When
notice of prepayment is delivered as provided herein, the principal amount of
the Loans specified in the notice shall become due and payable on the
prepayment date specified in such notice.
(ii) Amount; Application; Term Loan Commitment Reduction.
Unless the aggregate outstanding principal balance of the Term Loans, Tranche B
Term Loans, and Tranche C Term Loans is to be prepaid in full, voluntary
prepayments of the Term Loans, Tranche B Term Loans, and Tranche C Term Loans
shall be in an aggregate minimum amount of $1,000,000 and integral multiples of
$100,000 in excess of that amount. Each voluntary prepayment of the Term
Loans, Tranche B Term Loans, and Tranche C Term Loans shall be applied to the
unpaid installments of the Term Loans, Tranche B Term Loans, and Tranche C Term
Loans ratably, based on the relative outstanding principal balances thereof,
and in the order of maturity, shall be allocated first to Term Loans, Tranche B
Term Loans, and Tranche C Term Loans which are Base Rate Loans until paid in
full and then to Term Loans, Tranche B Term Loans, and Tranche C Term Loans
which are Eurodollar Rate Loans, and shall permanently reduce the Term Loan
Commitment of
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each Term Lender proportionately in accordance with its Term Loan Pro Rata
Share, Tranche B Term Loan Pro Rata Share, and Tranche C Term Loan Pro Rata
Share.
(iii) Voluntary Revolving Credit Commitment Reductions. The
Borrowers, upon at least three (3) Business Days' prior written notice to the
Administrative Agent (which the Administrative Agent shall promptly transmit to
each Lender), shall have the right, at any time and from time to time, to
terminate in whole or permanently reduce in part the Revolving Credit
Commitments; provided that the Borrowers shall have made whatever payment may
be required to reduce the Revolving Credit Obligations to an amount less than
or equal to the Revolving Credit Commitments as reduced or terminated. Any
partial reduction of the Revolving Credit Commitments shall be in an aggregate
minimum amount of $1,000,000 and integral multiples of $1,000,000 in excess of
that amount, and shall reduce the Revolving Credit Commitment of each Revolving
Lender proportionately in accordance with its Revolving Loan Pro Rata Share.
Any notice of termination or reduction given to the Administrative Agent under
this Section 4.01(a)(iii) shall specify the date (which shall be a Business
Day) of such termination or reduction and, with respect to a partial reduction,
the aggregate principal amount thereof. When notice of termination or
reduction is delivered as provided herein, the principal amount of the
Revolving Loans specified in the notice shall become due and payable on the
date specified in such notice.
(iv) Prepayment Fee. The prepayments and payments in respect
of reductions and terminations described in clauses (i) and (iii) of this
Section 4.01(a) may be made without premium or penalty (except as provided in
Article XIV).
(b) Mandatory Prepayments/Reductions.
(i) Net Cash Proceeds of Sale. Within three (3) Business
Days after receipt by either Borrower or any Subsidiary of a Borrower of any
Net Cash Proceeds of Sale, the Borrowers shall make or cause to be made a
mandatory prepayment of the Obligations in an amount equal to one hundred
percent (100%) of such Net Cash Proceeds of Sale which, when combined with all
other Net Cash Proceeds of Sale received in the same Fiscal Year, exceeds
$150,000 in the aggregate; provided, however, that notwithstanding the
foregoing, (A) one-third of the Net Cash Proceeds of Sale from the sale of Real
Property of ▇▇▇▇▇ Industries, Inc. located in Suffield, Connecticut shall be
required to be remitted as a mandatory prepayment of the Obligations, (B) that
portion of the Net Cash Proceeds of Sale from the sale of Real Property of
Matrix Aviation, Inc. located in Wichita, Kansas which exceeds $150,000 shall
be required to be remitted as a mandatory prepayment of the Obligations, and
(C) no
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portion of the Net Cash Proceeds of Sale from the sale of Banner's Investment
in warrants for Capital Stock of Interactive Flight Technologies, Inc. shall be
required to be remitted as a mandatory prepayment of the Obligations.
(ii) Excess Cash Flow. Within one hundred (100) days after
the end of each Fiscal Year ending in 1997 and thereafter, the Borrowers shall
(a) calculate Excess Cash Flow for such Fiscal Year and (b) make a mandatory
prepayment in an amount equal to the amount by which (A) seventy-five percent
(75%) of (1) Banner's cumulative Excess Cash Flow minus (2) the Excess Cash
Flow Basket exceeds (B) the aggregate of all amounts previously paid under this
Section 4.01(b)(ii); provided that no Excess Cash Flow prepayment made shall be
subject to any refund by the Lenders to the Borrowers as a result of any
subsequent calculation of Excess Cash Flow.
(iii) Net Cash Proceeds of Issuance of Equity Securities or
Indebtedness. Within three (3) Business Days after receipt by a Borrower or
any Subsidiary of a Borrower of any Net Cash Proceeds of Issuance of Equity
Securities or Indebtedness, the Borrowers shall make or cause to be made a
mandatory prepayment in an amount equal to seventy-five percent (75%) of such
Net Cash Proceeds of Issuance of Equity Securities or Indebtedness.
(iv) No Waiver or Consent. Nothing in this Section 4.01(b)
shall be construed to constitute the Lenders' consent to any transaction
referenced in clauses (i) and (iii) above which is not expressly permitted by
Article X.
(v) Notice. The Borrowers shall give the Administrative
Agent prior written notice or telephonic notice promptly confirmed in writing
(each of which the Administrative Agent shall promptly transmit to each
Lender), when a Designated Prepayment will be made (which date of prepayment
shall be no later than the date on which such Designated Prepayment becomes due
and payable pursuant to this Section 4.01(b)). Each such notice delivered with
respect to a Designated Prepayment described in Section 4.01(b)(i) shall be
accompanied by an Officer's Certificate executed by the chief financial
officer, vice-president of finance, treasurer or controller of Banner setting
forth in reasonable detail a calculation of the amount of such Designated
Prepayment. Within one hundred (100) days after the end of each Fiscal Year,
Borrowers shall deliver, with respect to a Designated Prepayment described in
Section 4.01(b)(ii), an Officer's Certificate executed by the chief financial
officer, vice-president of finance, treasurer or controller of Banner setting
forth in reasonable detail the calculation required to be made to determine
whether any Designated Prepayment from Excess Cash Flow shall be made.
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(vi) Application of Designated Prepayments. Designated
Prepayments shall be allocated and applied to the Obligations as follows:
(A) the amount of each Designated Prepayment shall be applied
to the unpaid installments of the Term Loans, Tranche B Term Loans,
and Tranche C Term Loans ratably based on the relative outstanding
principal balances of the Term Loans, Tranche B Term Loans, and
Tranche C Term Loans as of the date of application, with amounts
applied to each Term Loan, Tranche B Term Loan or Tranche C Term Loan
being applied ratably across all installments thereof and each
application being made first to the Loans which are Base Rate Loans
until paid in full and then to Loans which are Eurodollar Rate Loans
and shall permanently reduce the Term Loan Commitment of each Term
Lender proportionately in accordance with its Term Loan Pro Rata
Share, Tranche B Term Loan Pro Rata Share and Tranche C Term Loan Pro
Rata Share;
(B) following the payment in full of the Term Loans, Tranche
B Term Loans, and Tranche C Term Loans, the remaining balance of each
Designated Prepayment shall be applied to the outstanding Revolving
Loans and shall permanently reduce the Revolving Credit Commitment of
each Revolving Lender proportionately in accordance with its Revolving
Loan Pro Rata Share;
(C) following the payment in full of the Revolving Loans, the
remaining balance of each Designated Prepayment shall be applied to
the Letter of Credit Obligations (or, to the extent such Letter of
Credit Obligations are contingent, deposited in the Cash Collateral
Account to provide Cash Collateral in respect of such Letter of Credit
Obligations); and
(D) following the application to the Letter of Credit
Obligations described in clause (C) above, the remaining balance of
each Designated Prepayment shall be applied to all other Obligations
then outstanding in the order provided in Section 4.02(b)(i).
To the extent that the amount of the Designated Prepayments exceeds the
outstanding Obligations prepaid or repaid thereby, the amount of such excess
shall be disbursed in accordance with the Borrowers' written instructions to
the Administrative Agent.
(vii) Permanent Reduction. Upon the prepayment of Revolving
Loans pursuant to this Section 4.01(b), the Revolving Credit Commitments,
automatically and permanently, shall be reduced by the amount of such
prepayment.
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4.02. Payments. (a) Manner and Time of Payment. All
payments of principal of and interest on the Loans and Reimbursement
Obligations and other Obligations (including, without limitation, fees and
expenses) which are payable to the Administrative Agent, the Co-Agents, the
Lenders or the Issuing Banks shall be made without condition or reservation of
right, and, with respect to payments made other than from application of
deposits in the Concentration Account, in immediately available funds,
delivered to the Administrative Agent (or, in the case of Reimbursement
Obligations, to the applicable Issuing Bank(s)) not later than 3:00 p.m. (New
York time) on the date and at the place due, to such account of the
Administrative Agent (or the applicable Issuing Bank) as it may designate, for
the account of the Administrative Agent, the Co-Agents, the Lenders or the
applicable Issuing Bank, as the case may be; and funds received by the
Administrative Agent, including, without limitation, funds in respect of any
Revolving Loans to be made on that date, not later than 3:00 p.m. (New York
time) on any given Business Day shall be credited against payment to be made
that day and funds received by the Administrative Agent after that time shall
be deemed to have been paid on the next succeeding Business Day. Payments
actually received by the Administrative Agent for the account of the Co-Agents,
the Lenders, the Issuing Banks, or any of them, shall be paid to them by the
Administrative Agent promptly after receipt thereof.
(b) Apportionment of Payments. (i) Subject to the
provisions of Section 4.01 and Section 4.02(b)(v), all payments of principal
and interest in respect of outstanding Loans, all payments in respect of
Reimbursement Obligations, all payments of fees and all other payments in
respect of any other Obligations, shall be allocated among such of the Lenders
and the Issuing Banks as are entitled thereto, in proportion to their
respective Revolving Loan Pro Rata Shares, Term Loan Pro Rata Shares, Tranche B
Term Loan Pro Rata Shares, Tranche C Term Loan Pro Rata Shares, or otherwise as
provided herein. Except as provided in Section 4.02(b)(ii) with respect to
payments and proceeds of Collateral received after the occurrence of an Event
of Default, all such payments and any other amounts received by the
Administrative Agent from or for the benefit of the Borrowers shall be applied:
(A) FIRST, to pay principal of and interest on any portion of the
Revolving Loans which the Administrative Agent may have advanced on behalf of
any Revolving Lender other than Citicorp for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrowers,
(B) SECOND, to pay principal of and interest on any Protective
Advance for which the Administrative Agent has not then been paid by the
Borrowers or reimbursed by the Revolving Lenders,
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(C) THIRD, to pay principal of and accrued interest on any Swing
Loans then outstanding,
(D) FOURTH, to pay the principal of the Term Loans, Tranche B Term
Loans, Tranche C Term Loans, and Revolving Loans then due and payable in the
order described hereinbelow and interest on such Loans then due and payable,
ratably, based on the then outstanding balances of such Loans,
(E) FIFTH, to pay all other Obligations then due and payable,
ratably, and
(F) SIXTH, as the Borrowers so designate.
(ii) After the occurrence of an Event of Default and while the
same is continuing, the Administrative Agent shall apply all payments in
respect of any Obligations and all proceeds of Collateral in the following
order:
(A) FIRST, to pay principal of and interest on any portion of the
Revolving Loans which the Administrative Agent may have advanced on behalf of
any Revolving Lender other than Citicorp for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrowers;
(B) SECOND, to pay principal of and interest on any Protective
Advance for which the Administrative Agent has not then been paid by the
Borrowers or reimbursed by the Revolving Lenders;
(C) THIRD, to pay principal of and interest on any Swing Loan then
outstanding;
(D) FOURTH, to pay Obligations in respect of any fees, expense
reimbursements or indemnities then due to the Administrative Agent;
(E) FIFTH, to pay principal of and interest on Letter of Credit
Obligations (or, to the extent such Obligations are contingent, deposited in
the Cash Collateral Account to provide Cash Collateral in respect of such
Obligations);
(F) SIXTH, to pay Obligations in respect of any fees, expense
reimbursements or indemnities then due to the Co-Agents, the Lenders and the
Issuing Banks;
(G) SEVENTH, to pay interest due in respect of the Loans, ratably,
in accordance with the Lenders' respective Pro Rata Shares;
(H) EIGHTH, to the ratable payment or prepayment of (1) principal
outstanding on all Loans with application to
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installments on the Term Loans, Tranche B Term Loans, and Tranche C Term Loans
in the inverse order of maturity and (2) Hedge Agreements to which any of the
Lenders or any Affiliate of any of the Lenders is a party; and
(I) NINTH, to the ratable payment of all other Obligations.
With respect to clause (i) above, all principal and interest payments and
applications of proceeds of Collateral in respect of Term Loans, Tranche B Term
Loans, Tranche C Term Loans and Revolving Loans shall be applied FIRST,
ratably, to the Term Loans, Tranche B Term Loans, and Tranche C Term Loans (to
installments and accrued interest then due and payable, ratably, in accordance
with the Lenders' respective Term Loan Pro Rata Shares, Tranche B Term Loan Pro
Rata Shares, and Tranche C Term Loan Pro Rata Shares) and SECOND, to the
Revolving Loans and accrued interest thereon ratably, in accordance with the
Revolving Lenders' respective Revolving Loan Pro Rata Shares; in either case,
FIRST, to repay outstanding Base Rate Loans and THEN to repay outstanding
Eurodollar Rate Loans with those Eurodollar Rate Loans which have earlier
expiring Eurodollar Interest Periods being repaid prior to those which have
later expiring Eurodollar Interest Periods. Application shall be made, in each
instance where principal and interest are designated, FIRST, to interest until
paid in full and THEN, to principal. The order of priority set forth in this
Section 4.02(b) and the related provisions of this Agreement are set forth
solely to determine the rights and priorities of the Administrative Agent, the
Co- Agents, the Lenders, the Issuing Banks and other Holders as among
themselves.
(iii) The Administrative Agent, in its sole discretion,
subject only to the terms of this Section 4.02(b)(iii), may pay from the
proceeds of Revolving Loans made to the Borrowers pursuant to Section 2.02 or a
deemed request as provided in this Section 4.02(b)(iii), all amounts payable by
the Borrowers hereunder, including, without limitation, amounts payable with
respect to payments of principal, interest, Reimbursement Obligations and fees
and all reimbursements for expenses pursuant to Section 15.02. The Borrowers
hereby irrevocably authorize the Revolving Lenders to make Revolving Loans,
which Revolving Loans shall be Base Rate Loans, in each case, upon notice from
the Administrative Agent as described in the following sentence for the purpose
of paying principal, interest, Reimbursement Obligations and fees due from the
Borrowers, reimbursing expenses pursuant to Section 15.02 and paying any and
all other amounts due and payable by the Borrowers hereunder or under the
Notes, and agrees that all such Revolving Loans so made shall be deemed to have
been requested by it pursuant to Section 2.02 as of the date of the
aforementioned notice. The Administrative Agent shall request Revolving Loans
on behalf of the Borrowers as described in the preceding sentence by notifying
the Revolving
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Lenders by telecopy, telegram or other similar form of transmission (which
notice the Administrative Agent shall thereafter promptly transmit to the
Borrowers), of the amount and Revolving Loan Funding Date of the proposed
Borrowing and that such Borrowing is being requested on the Borrowers' behalf
pursuant to this Section 4.02(b)(iii). On the proposed Funding Date for such
Revolving Loan, the Revolving Lenders shall make the requested Revolving Loans
in accordance with the procedures and subject to the conditions specified in
Section 2.02.
(iv) Subject to Section 4.02(b)(v), the Administrative Agent
shall promptly distribute to each Lender and Issuing Bank at its primary
address set forth on the appropriate signature page hereof or the signature
page to the Assignment and Acceptance by which the Lender became a Lender, or
at such other address as a Lender, Issuing Bank or other Holder may request in
writing, such funds as such Person may be entitled to receive; provided that
the Administrative Agent shall under no circumstances be bound to inquire into
or determine the validity, scope or priority of any interest or entitlement of
any Holder and may suspend all payments or seek appropriate relief (including,
without limitation, instructions from the Requisite Lenders or an action in the
nature of interpleader) in the event of any doubt or dispute as to any
apportionment or distribution contemplated hereby.
(v) In the event that any Revolving Lender fails to fund its
Revolving Loan Pro Rata Share of any Revolving Loan requested by the Borrowers
which such Lender is obligated to fund under the terms of this Agreement (the
funded portion of such Revolving Loan being hereinafter referred to as a "Non
Pro Rata Loan"), until the earlier of such Lender's cure of such failure and
the termination of the Revolving Credit Commitments, the proceeds of all
amounts thereafter repaid to the Administrative Agent by the Borrowers and
otherwise required to be applied to such Lender's share of all other
Obligations pursuant to the terms of this Agreement shall be advanced to the
Borrowers by the Administrative Agent on behalf of such Lender to cure, in full
or in part, such failure by such Lender, but shall nevertheless be deemed to
have been paid to such Lender in satisfaction of such other Obligations.
Notwithstanding anything in this Agreement to the contrary:
(A) the foregoing provisions of this Section 4.02(b)(v) shall
apply only with respect to the proceeds of payments of Obligations and
shall not affect the conversion or continuation of Loans pursuant to
Section 5.01(c);
(B) a Revolving Lender shall be deemed to have cured its
failure to fund its Pro Rata Share of any Revolving Loan at such time
as an amount equal to such
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Lender's original Revolving Loan Pro Rata Share of the requested
principal portion of such Revolving Loan is fully funded to the
Borrowers, whether made by such Lender itself or by operation of the
terms of this Section 4.02(b)(v), and whether or not the Non Pro Rata
Loan with respect thereto has been repaid, converted or continued;
(C) amounts advanced to the Borrowers to cure, in full or in
part, any such Lender's failure to fund its Revolving Loan Pro Rata
Share of any Revolving Loan ("Cure Loans") shall bear interest at the
rate in effect from time to time pursuant to Section 5.01 and for
all other purposes of this Agreement shall be treated as if they were
Base Rate Loans; and
(D) regardless of whether or not an Event of Default has
occurred or is continuing, and notwithstanding the instructions of the
Borrowers as to its desired application, all repayments of principal
which, in accordance with the other terms of this Section 4.02, would
be applied to the outstanding Revolving Loans which are Base Rate
Loans shall be applied FIRST, ratably to all such Base Rate Loans
constituting Non Pro Rata Loans, SECOND, ratably to such Base Rate
Loans other than those constituting Non Pro Rata Loans or Cure Loans
and, THIRD, ratably to such Base Rate Loans constituting Cure Loans.
(c) Payments on Non-Business Days. Whenever any payment to
be made by the Borrowers hereunder or under the Notes is stated to be due on a
day which is not a Business Day, the payment shall instead be due on the next
succeeding Business Day (except as set forth in Section 5.02(b)(iii) with
respect to payments due on the next preceding Business Day), and any such
extension of time shall be included in the computation of the payment of
interest and fees hereunder.
4.03. Promise to Repay; Evidence of Indebtedness.
(a) Promise to Repay. The Borrowers hereby jointly and
severally agree to pay when due the principal amount of each Loan which is made
to either of them, and further jointly and severally agree to pay all unpaid
interest accrued thereon, in accordance with the terms of this Agreement and
the Notes. The Borrowers shall execute and deliver to each Tranche C Term
Lender on the Funding Date therefor a Note evidencing the Tranche C Term Loan
made by such Lender. The Borrowers shall execute and deliver such other Notes
as are necessary to evidence Loans owing to the Lenders after giving effect to
any assignment thereof pursuant to Section 15.01.
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(b) Loan Account. Each Lender shall maintain in
accordance with its usual practice an account or accounts (a "Loan Account")
evidencing the Indebtedness of the Borrowers to such Lender resulting from each
Loan owing to such Lender from time to time, including the amount of principal
and interest payable and paid to such Lender from time to time hereunder and
under the Notes.
(c) Control Account. The Register maintained by the
Administrative Agent pursuant to Section 15.01(c) shall include a control
account, and a subsidiary account for each Lender, in which accounts (taken
together) shall be recorded (i) the date and amount of each Borrowing made
hereunder, the type of Loan comprising such Borrowing and any Eurodollar
Interest Period applicable thereto, (ii) the effective date and amount of each
Assignment and Acceptance delivered to and accepted by it and the parties
thereto, (iii) the amount of any principal or interest due and payable or to
become due and payable from the Borrowers to each Lender hereunder or under the
Notes, and (iv) the amount of any sum received by the Administrative Agent from
the Borrowers hereunder and each Lender's share thereof.
(d) Entries Binding. The entries made in the Register
and each Loan Account shall be conclusive and binding for all purposes, absent
manifest error.
4.04. Proceeds of Collateral; Concentration Account
Arrangements. The Borrowers shall establish and maintain, and shall cause
their Subsidiaries to establish and maintain, Collection Accounts into which
all collections of Receivables shall be deposited and transferred to the
Concentration Account as and when provided in the Collection Account
Agreements; provided, however, that Guarantors may maintain depository accounts
subject to the restrictions set forth in Section 10.16, without a Collection
Account Agreement. Borrowers shall cause all proceeds of Collateral to be
deposited in a Collection Account or pursuant to other similar arrangements for
the collection of such amounts established by the Borrowers and the
Administrative Agent. All collections of Receivables and proceeds of Collateral
which are received directly by the Borrowers or any Subsidiary of a Borrower
shall be deemed to have been received by the Borrowers or such Subsidiary as
the Administrative Agent's trustee and, upon the Borrowers' or such
Subsidiary's receipt thereof after the occurrence and during the continuance of
an Event of Default, the Borrowers shall immediately transfer or cause to be
transferred, all such amounts into the Concentration Account in their original
form. All collections of Receivables, all payments, and all proceeds of other
Collateral received by the Administrative Agent, whether through payment,
disbursement from the Concentration Account in accordance with the terms of the
Concentration Account Agreement governing the same, or otherwise, will be the
sole property of the Administrative Agent, and will
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be held by the Administrative Agent, for the benefit of the Holders (i) for
application to the Obligations pursuant to Section 4.02 and (ii) thereafter, as
Cash Collateral for the Obligations, subject to the rights of the
Administrative Agent set forth in Section 4.06.
4.05. Cash Collateral Account. (a) Investments. If
requested by the Borrowers, the Administrative Agent shall, so long as no Event
of Default shall have occurred and be continuing, from time to time invest
funds on deposit in the Cash Collateral Account and accrued interest thereon,
reinvest proceeds of any such investments which may mature or be sold, and
invest interest or other income received from any such Investments, in each
case in such Cash Equivalents as the Borrowers may select. Such funds,
interest, proceeds or income which are not so invested or reinvested in Cash
Equivalents shall, except as otherwise provided in Section 4.05(b) and Section
4.06, be deposited and held by the Administrative Agent in the Cash Collateral
Account. None of the Administrative Agent, any Co-Agent, any Lender or any
Issuing Bank shall be liable to the Borrowers for, or with respect to, any
decline in value of amounts on deposit in the Cash Collateral Account which
shall have been invested pursuant to this Section 4.05(a) at the direction of
the Borrowers. Cash Equivalents from time to time purchased and held pursuant
to this Section 4.05(a) shall constitute Cash Collateral and shall, for
purposes of this Agreement, be deemed to be part of the funds held in the Cash
Collateral Account in amounts equal to their respective outstanding principal
amounts.
(b) Withdrawal Rights. Neither the Borrowers nor any Person
or entity claiming on behalf of or through a Borrower shall have any right to
withdraw any of the funds held in the Cash Collateral Account, except that,
upon the later to occur of (i) the expiration or termination of all of the
Letters of Credit in accordance with their respective terms and (ii) the
payment in full in cash of the Obligations, any funds remaining in the Cash
Collateral Account shall be returned by the Administrative Agent to the
Borrowers or paid to whomever may be legally entitled thereto.
(c) Additional Deposits. If at any time the Administrative
Agent determines that any funds held in the Cash Collateral Account are subject
to any interest, right, claim or Lien of any Person other than the
Administrative Agent, the Borrowers will, forthwith upon demand by the
Administrative Agent, pay to the Administrative Agent, as additional funds to
be deposited and held in the Cash Collateral Account, an amount equal to the
amount of funds subject to such interest, right, claim or Lien.
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(d) Reasonable Care. The Administrative Agent shall exercise
reasonable care in the custody and preservation of any funds held in the Cash
Collateral Account and shall be deemed to have exercised such care if such
funds are accorded treatment substantially equivalent to that which the
Administrative Agent accords its own like property, it being understood that
the Administrative Agent shall not have any responsibility for taking any
necessary steps to preserve rights against any parties with respect to any such
funds but may do so at its option. All expenses incurred in connection
therewith shall be for the sole account of the Borrowers and shall constitute
Obligations hereunder.
4.06. Post-Default Withdrawals from the Concentration
Account and Cash Collateral Account. Notwithstanding any other provision of
this Agreement or any other agreement governing the Concentration Account, from
and after the occurrence of an Event of Default and for so long as the same is
continuing unwaived, neither Borrower nor any Person or entity claiming on
behalf of or through a Borrower shall have any right to withdraw any of the
funds held in the Concentration Account, all of which rights shall be rights of
the Administrative Agent as more particularly described in the Concentration
Account Agreement. The Administrative Agent may, at any time after the
occurrence and during the continuance of an Event of Default, sell or cause to
be sold any Cash Equivalents being held by the Administrative Agent in the
Concentration Account or as Cash Collateral at any broker's board or at public
or private sale, in one or more sales or lots, at such price as the
Administrative Agent may deem best, without assumption of any credit risk, and
the purchaser of any or all such Cash Equivalents so sold shall thereafter own
the same, absolutely free from any claim, encumbrance or right of any kind
whatsoever. The Administrative Agent or any Holder may, in its own name or in
the name of a designee or nominee, buy such Cash Equivalents at any public sale
and, if permitted by applicable law, buy such Cash Equivalents at any private
sale. The Administrative Agent shall apply the proceeds of any such sale, net
of any reasonable expenses incurred in connection therewith, and any other
funds deposited in the Concentration Account or Cash Collateral Account to the
payment of the Obligations in accordance with Section 4.02(b)(ii), other than
amounts which are being held as Cash Collateral for Reimbursement Obligations,
which shall be applied to such Reimbursement Obligations without regard to
Section 4.02(b)(ii). The Borrowers agree that any sale of Cash Equivalents
conducted in conformity with reasonable commercial practices of banks,
commercial finance companies, insurance companies or other financial
institutions disposing of property similar to such Cash Equivalents shall be
deemed to be commercially reasonable and any requirements of reasonable notice
shall be met if such notice is given by the Administrative Agent within a
commercially reasonable time prior to such disposition, the time of delivery of
which notice the
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parties hereto agree shall in no event be required to be greater than five (5)
Business Days before the date of the intended sale or disposition. Any other
requirement of notice, demand or advertisement for sale is waived to the extent
permitted by law. The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed therefor and
such sale may, without further notice, be made at the time and place to which
it was so adjourned.
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ARTICLE V
INTEREST AND FEES
5.01. Interest on the Loans and other Obligations. (a) Rate
of Interest. (i) All Loans shall bear interest on the unpaid principal amount
thereof from the date such Loans are made until paid in full, except as
otherwise provided in Section 5.01(d) or Section 14.04, as follows:
(A) If a Base Rate Loan, at a rate per annum equal to the
sum of the Base Rate, as in effect from time to time as interest
accrues, plus (1) the applicable Base Rate Margin, if such Base Rate
Loan is not a Tranche B Term Loan or a Tranche C Term Loan, (2) one
and three-quarters percent (1.75%), if such Base Rate Loan is a
Tranche B Term Loan and (3) the applicable Tranche C Base Rate Margin,
if such Base Rate Loan is a Tranche C Term Loan; and
(B) If a Eurodollar Rate Loan, at a rate per annum equal
to the sum of the Eurodollar Rate deter mined for the applicable
Eurodollar Interest Period, plus (1) the applicable Eurodollar Rate
Margin, if such Eurodollar Rate Loan is not a Tranche B Term Loan or a
Tranche C Term Loan, (2) three percent (3.0%), if such Eurodollar Rate
Loan is a Tranche B Term Loan, and (3) the applicable Tranche C
Eurodollar Rate Margin, if such Eurodollar Rate Loan is a Tranche C
Term Loan;
provided, however, that during the period commencing on the Effective Date and
ending on July 1, 1997, the amount by which the sum of the Revolving Credit
Obligations plus the outstanding Protective Advances plus the outstanding
balance of the Swing Loans at any time exceeds the Borrowing Base, shall bear
interest at the then applicable per annum rates of interest as set forth above
plus one-quarter of one percent (0.25%).
(ii) The applicable basis for determining the rate of
interest on the Loans shall be selected by the Borrowers at the time a Notice
of Borrowing or a Notice of Conversion/Continuation is delivered by the
Borrowers to the Administrative Agent; provided, however, the Borrowers may not
select the Eurodollar Rate as the applicable basis for determining the rate of
interest on such a Loan if, at the time of such selection, an Event of Default
or a Potential Event of Default would occur or has occurred and is continuing.
If on any day any Loan is outstanding with respect to which notice has not been
timely delivered to the Administrative Agent in accordance with the terms of
this Agreement specifying the basis for determining the rate of interest on
that day, then for that day interest on that Loan shall be determined by
reference to the Base Rate.
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(b) Interest Payments. (i) Interest accrued on each Base
Rate Loan shall be payable in arrears (A) on the first day of each calendar
month for the immediately preceding calendar month, commencing on the first
such day following the making of such Base Rate Loan, and (B) if not
theretofore paid in full, at maturity (whether by acceleration or otherwise) of
such Base Rate Loan; provided, however, that interest accrued on all Swing
Loans shall be payable on demand or in the absence of demand as otherwise
provided in clause (A).
(ii) Interest accrued on each Eurodollar Rate Loan shall be
payable in arrears (A) on each Eurodollar Interest Payment Date applicable to
such Loan, (B) upon the payment or prepayment thereof in full or in part, and
(C) if not theretofore paid in full, at maturity (whether by acceleration or
otherwise) of such Eurodollar Rate Loan.
(c) Conversion or Continuation. (i) The Borrowers shall have
the option (A) to convert at any time all or any part of outstanding Base Rate
Loans (other than Swing Loans) to Eurodollar Rate Loans; (B) to convert all or
any part of outstanding Eurodollar Rate Loans having Eurodollar Interest
Periods which expire on the same date to Base Rate Loans on such expiration
date; or (C) to continue all or any part of an outstanding Eurodollar Rate Loan
at the expiry of the applicable Eurodollar Interest Period, and the succeeding
Eurodollar Interest Period of such continued Loans shall commence on such
expiration date; provided, however, no such outstanding Loan may be continued
as, or be converted into, a Eurodollar Rate Loan (i) if the continuation of, or
the conversion into, would violate any of the provisions of Section 5.02 or
(ii) if an Event of Default or a Potential Event of Default would occur or has
occurred and is continuing unwaived. Any conversion into or continuation of
Eurodollar Rate Loans under this Section 5.01(c) shall be in a minimum amount
of $1,000,000 and in integral multiples of $100,000 in excess of that amount
except in the case of a conversion into or a continuation of an entire
Borrowing of Non Pro Rata Loans.
(ii) To convert or continue a Loan under Section 5.01(c)(i),
the Borrowers shall deliver a Notice of Conversion/Continuation to the
Administrative Agent no later than 12:00 noon (New York time) at least three
(3) Business Days in advance of the proposed conversion/continuation date. A
Notice of Conversion/Continuation shall specify (A) the proposed
conversion/continuation date (which shall be a Business Day), (B) the
principal amount of the Loan to be converted/continued and whether such Loan is
a Revolving Loan, a Term Loan, a Tranche B Term Loan, or a Tranche C Term Loan,
(C) whether such Loan shall be converted and/or continued, and (D) in the case
of a conversion to, or continuation of, a Eurodollar Rate Loan, the requested
Eurodollar Interest Period. In lieu of delivering a Notice of
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Conversion/Continuation (other than a Notice of Conversion/Continuation
delivered on the Effective Date), the Borrowers may give the Administrative
Agent telephonic notice of any proposed conversion/continuation by the time
required under this Section 5.01(c)(ii), and such notice shall be confirmed in
writing delivered to the Administrative Agent by facsimile transmission
promptly (but in no event later than 5:00 p.m. (New York time) on the same
day), the original of which facsimile copy shall be delivered to the
Administrative Agent within three (3) days after the date of such transmission.
Promptly after receipt of a Notice of Conversion/Continuation under this
Section 5.01(c)(ii) (or telephonic notice in lieu thereof), the Administrative
Agent shall notify each Lender by telecopy, or other similar form of
transmission, of the proposed conversion/ continuation. Any Notice of
Conversion/Continuation for conversion to, or continuation of, a Loan (or
telephonic notice in lieu thereof) shall be irrevocable, and the Borrowers
shall be bound to convert or continue in accordance therewith.
(d) Default Interest. (i) Notwithstanding the rates of
interest specified in Section 5.01(a), effective immediately upon the
occurrence of an Event of Default and for as long there after as such Event of
Default shall be continuing unwaived, (A) the principal balance of all Loans
which are not Tranche B Term Loans or Tranche C Term Loans and the principal
balance of all other Obligations (other than Obligations in respect of Tranche
B Term Loans and Tranche C Term Loans) which are not paid as and when due,
shall bear interest at a rate equal to the sum of (1) the Base Rate, plus the
Base Rate Margin applicable on the Closing Date plus two percent (2.0%) per
annum, (B) the principal balance of all Tranche B Term Loans and all other
Obligations in respect of Tranche B Term Loans which are not paid as and when
due, shall bear interest at a rate equal to the sum of the Base Rate plus three
and three-quarters percent (3.75%) per annum, and (C) the principal balance of
all Tranche C Term Loans and all other Obligations in respect of Tranche C Term
Loans which are not paid as and when due, shall bear interest at a rate equal
to the sum of the Base Rate plus three and one-half percent (3.50%) per annum.
(ii) Interest accrued on the principal balance of all
Obligations other than the Loans shall be payable in arrears (A) on the first
day of each calendar month for the immediately preceding calendar month,
commencing on the first such day following the due date of such Obligation, and
(B) upon payment thereof in full or in part.
(e) Computation of Interest. Interest on all Obligations
shall be computed on the basis of the actual number of days elapsed in the
period during which interest accrues and a year of 360 days. In computing
interest on any Loan, the date of the making of the Loan or the first day of a
Eurodollar Interest
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Period, as the case may be, shall be included and the date of payment or the
expiration date of a Eurodollar Interest Period, as the case may be, shall be
excluded; provided, however, if a Loan is repaid on the same day on which it is
made, one (1) day's interest shall be paid on such Loan.
5.02. Special Provisions Governing Eurodollar Rate Loans.
With respect to Eurodollar Rate Loans:
(a) Amount of Eurodollar Rate Loans. Each Eurodollar Rate
Loan shall be for a minimum amount of $1,000,000 and in integral multiples of
$50,000 in excess of that amount.
(b) Determination of Eurodollar Interest Period. By giving
notice as set forth in Section 2.02(b) (with respect to a Borrowing of
Eurodollar Rate Loans) or Section 5.01(c) (with respect to a conversion into or
continuation of Eurodollar Rate Loans), the Borrowers shall have the option,
subject to the other provisions of this Section 5.02, to select an interest
period (each, a "Eurodollar Interest Period") to apply to the Loans described
in such notice, subject to the following provisions:
(i) The Borrowers may only select a Eurodollar Interest
Period of one, two, three or six months in duration;
(ii) In the case of immediately successive Eurodollar
Interest Periods applicable to a Borrowing of Eurodollar Rate Loans,
each successive Eurodollar Interest Period shall commence on the day
on which the next preceding Eurodollar Interest Period expires;
(iii) If any Eurodollar Interest Period would otherwise
expire on a day which is not a Business Day, such Eurodollar Interest
Period shall be extended to expire on the next succeeding Business Day
if the next succeeding Business Day occurs in the same calendar month,
and if there will be no succeeding Business Day in such calendar
month, the Eurodollar Interest Period shall expire on the immediately
preceding Business Day;
(iv) The Borrowers may not select a Eurodollar Interest
Period as to any Revolving Loan if such Eurodollar Interest Period
terminates later than the scheduled Revolving Credit Termination Date;
(v) The Borrowers may not select a Eurodollar Interest Period
as to any Term Loan if such Eurodollar Interest Period terminates
later than the scheduled Term Loan Termination Date;
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(vi) The Borrowers may not select a Eurodollar Interest
Period as to any Tranche B Term Loan if such Eurodollar Interest
Period terminates later than the scheduled Tranche B Term Loan
Termination Date;
(vii) The Borrowers may not select a Eurodollar Interest
Period as to any Tranche C Term Loan if such Eurodollar Interest
Period terminates later than the scheduled Tranche C Term Loan
Termination Date;
(viii) The Borrowers may not select a Eurodollar Interest
Period with respect to any portion of principal of a Loan which
extends beyond a date on which the Borrowers are required to make a
scheduled payment of such portion of principal; and
(ix) There shall be no more than six (6) Eurodollar Interest
Periods in effect at any one time.
(c) Determination of Interest Rate. As soon as practicable
on the second Business Day prior to the first day of each Eurodollar Interest
Period (the "Eurodollar Interest Rate Determination Date"), the Administrative
Agent shall determine (pursuant to the procedures set forth in the definition
of "Eurodollar Rate") the interest rate which shall apply to the Eurodollar
Rate Loans for which an interest rate is then being determined for the
applicable Eurodollar Interest Period and shall promptly give notice thereof
(in writing or by telephone confirmed in writing) to the Borrowers and to each
Lender. The Administrative Agent's determination shall be presumed to be
correct, absent manifest error, and shall be binding upon the Borrowers.
(d) Reference Banks. Each Reference Bank agrees to furnish
to the Administrative Agent timely information for the purpose of determining
the Eurodollar Rate. Upon the reasonable request of the Borrowers from time to
time, the Administrative Agent shall promptly provide to the Borrowers such
information with respect to the applicable Eurodollar Rate as may be so
requested, and each Reference Bank agrees to furnish to the Administrative
Agent such information as may be required in connection therewith. Subject to
Section 5.02(f), if on any Eurodollar Interest Rate Determination Date any of
the Reference Banks has failed to provide offered quotations to the
Administrative Agent in accordance with the definition of "Eurodollar Rate",
the Administrative Agent shall determine the Eurodollar Rate using the
quotations of the other Reference Banks.
(e) Interest Rate Unascertainable, Inadequate or Unfair.
In the event that at least one (1) Business Day before the Eurodollar Interest
Rate Determination Date:
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(i) the Administrative Agent is advised by NationsBank or
Citibank that deposits in Dollars (in the applicable amounts) are not
being offered by either Reference Bank in the London interbank market
for such Eurodollar Interest Period; or
(ii) the Administrative Agent determines that adequate and
fair means do not exist for ascertaining the applicable interest rates
by reference to which the Eurodollar Rate then being determined is to
be fixed; or
(iii) the Requisite Lenders advise the Administrative Agent
that the Eurodollar Rate for Eurodollar Rate Loans comprising such
Borrowing will not adequately reflect the cost to such Requisite
Lenders of obtaining funds in Dollars in the London interbank market
in the amount substantially equal to such Lenders' Eurodollar Rate
Loans in Dollars and for a period equal to such Eurodollar Interest
Period;
then the Administrative Agent shall forthwith give notice thereof to the
Borrowers, whereupon (until the Administrative Agent notifies the Borrowers
that the circumstances giving rise to such suspension no longer exist) the
right of the Borrowers to elect to have Loans bear interest based upon the
Eurodollar Rate shall be suspended and each outstanding Eurodollar Rate Loan
shall be converted into a Base Rate Loan on the last day of the then current
Eurodollar Interest Period therefor, notwithstanding any prior election by the
Borrowers to the contrary.
(f) Booking of Eurodollar Rate Loans. Any Lender may make,
carry or transfer Eurodollar Rate Loans at, to, or for the account of, its
Eurodollar Lending Office or Eurodollar Affiliate or its other offices or
Affiliates. No Lender shall be entitled, however, to receive any greater
amount under Article XIV as a result of the transfer of any such Eurodollar
Rate Loan to any office (other than such Eurodollar Lending Office) or any
Affiliate (other than such Eurodollar Affiliate) than such Lender would have
been entitled to receive immediately prior thereto, unless (i) the transfer
occurred at a time when circumstances giving rise to the claim for such greater
amount did not exist and (ii) such claim would have arisen even if such
transfer had not occurred.
(g) Affiliates Not Obligated. No Eurodollar Affiliate or
other Affiliate of any Lender shall be deemed a party to this Agreement or
shall have any liability or obligation under this Agreement.
5.03. Fees. (a) Letter of Credit Fee. In addition to any
charges paid pursuant to Section 3.01(g), the Borrowers
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shall pay to the (i) Issuing Bank issuing a given Letter of Credit, a fee equal
to one-quarter of one percent (0.25%) on the face amount of such Letter of
Credit issued by such Issuing Bank, upon issuance of such Letter of Credit (the
"Fronting Fee") and (ii) Administrative Agent, for the account of the Revolving
Lenders based on their respective Revolving Loan Pro Rata Shares, a fee (the
"Letter of Credit Fee") accruing at a per annum rate equal to the Eurodollar
Rate Margin in effect from time to time on the undrawn face amount of each
outstanding Letter of Credit, payable quarterly, in arrears, on the last day of
each calendar quarter; provided, however, that during the period commencing on
August 2, 2000 and ending on August 1, 2001, the rate at which the Letter of
Credit Fee shall accrue and be payable shall be increased by one-quarter of one
percent (0.25%); and provided further that upon the occurrence of an Event of
Default and for so long thereafter as such Event of Default shall be continuing
unwaived, the rate at which the Letter of Credit Fee would otherwise accrue and
be payable shall be increased by two percent (2.0%) per annum.
(b) Unused Commitment Fee. (i) The Borrowers shall pay to
the Administrative Agent, for the account of the Revolving Lenders in
accordance with their respective Revolving Loan Pro Rata Shares, an Unused
Commitment Fee, accruing on the average amount by which the Revolving Credit
Commitments exceed the sum of (A) the outstanding principal amount of the
Revolving Loans, plus (B) the outstanding Reimbursement Obligations, plus (C)
the aggregate undrawn face amount of all outstanding Letters of Credit, for the
period commencing on the Closing Date and ending on the Revolving Credit
Termination Date, such Unused Commitment Fee being payable (I) quarterly, in
arrears, commencing on the first day of the calendar quarter next succeeding
the Closing Date and (II) on the Revolving Credit Termination Date. During the
period commencing on August 2, 2000 and ending on August 1, 2001, the rate at
which the Unused Commitment Fee shall accrue and be payable shall be increased
by one-fortieth of one percent (0.025%) for that portion of such period in
which Performance Levels 1, 2, or 3 are applicable.
(ii) Notwithstanding the foregoing, in the event that any
Revolving Lender fails to fund its Revolving Loan Pro Rata Share of any
Revolving Loan requested by the Borrowers which such Lender is obligated to
fund under the terms of this Agreement, (A) such Lender shall not be entitled
to any Unused Commitment Fees with respect to its Revolving Credit Commitment
until such failure has been cured in accordance with Section 4.02(b)(v)(B) and
(B) until such time, the Unused Commitment Fee shall accrue in favor of the
Revolving Lenders which have funded their respective Revolving Loan Pro Rata
Shares of such requested Revolving Loan, shall be allocated among such
performing Revolving Lenders ratably based upon their respective Revolving
Credit Commitments, and shall be calculated based upon the
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average amount by which the aggregate Revolving Credit Commitments of such
performing Revolving Lenders exceeds the sum of (1) the outstanding principal
amount of the Revolving Loans and Swing Loans owing to such performing
Revolving Lenders, plus (2) the outstanding Reimbursement Obligations owing to
such performing Revolving Lenders, plus (3) the aggregate participation
interests of such performing Revolving Lenders arising pursuant to Section
3.01(e) with respect to undrawn and outstanding Letters of Credit.
(iii) The Borrowers shall pay to the Administrative Agent,
for the account of the Tranche C Term Lenders in accordance with their
respective Tranche C Term Loan Pro Rata Shares, an Unused Commitment Fee
accruing on the Tranche C Term Loan Commitments for the period commencing on
the Effective Date and ending on the Funding Date for the Tranche C Term Loans,
such Unused Commitment Fee being payable quarterly, in arrears, commencing on
the first day of the calendar quarter next succeeding the Effective Date and on
the Funding Date for the Tranche C Term Loans.
(c) Administrative Agent's Fee. The Borrowers shall pay to
the Administrative Agent, solely for the account of the Administrative Agent,
the fees set forth in the 1995 Fee Letter, which fees shall constitute part of
the Obligations secured by the Collateral.
(d) Calculation and Payment of Fees. All of the above fees
shall be calculated on the basis of the actual number of days elapsed in a
360-day year. All such fees shall be payable in addition to, and not in lieu
of, interest, compensation, expense reimbursements, indemnification and other
Obligations, to the Administrative Agent at its office in New York, New York in
immediately available funds. All fees shall be fully earned and nonrefundable
when paid. All fees specified or referred to in this Agreement due to the
Administrative Agent, any Issuing Bank or any Lender, including, without
limitation, those referred to in this Section 5.03, shall bear interest, if not
paid when due, at the interest rate for Base Rate Loans set forth in Section
5.01(d), shall constitute Obligations and shall be secured by all of the
Collateral.
5.04. Determination of Applicable Base Rate Margin,
Eurodollar Rate Margin, Tranche C Base Rate Margin, Tranche C Eurodollar Rate
Margin and Unused Commitment Fee. The Base Rate Margin, Eurodollar Rate Margin
and Unused Commitment Fee applicable for the period commencing on the Closing
Date and ending on September 30, 1995 shall be determined based on the
Performance Level 5. The Base Rate Margin, Eurodollar Rate Margin and Unused
Commitment Fee applicable from time to time thereafter shall be determined by
reference to Borrowers' compliance with Performance Levels 1 through 6 as of
the end of each fiscal
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quarter of Banner and apply to the next succeeding fiscal quarter of Banner.
Borrowers shall deliver to the Administrative Agent within twenty-five (25)
days after the end of each fiscal quarter of Banner commencing with the fiscal
quarter ending on September 30, 1995, the financial and other information
designated on EXHIBIT I attached hereto satisfactory in substance to the
Administrative Agent establishing Borrowers' compliance with the appropriate
Performance Level 1, 2, 3, 4, 5 or 6 as of such fiscal quarter end. If, on the
basis of such financial and other information, the Administrative Agent
determines that an adjustment is required to the Base Rate Margin, Eurodollar
Rate Margin, Tranche C Base Rate Margin, Tranche C Eurodollar Rate Margin,
and/or Unused Commitment Fee in effect as of such fiscal quarter end, such
adjustment shall be made as of the first day of the next succeeding such fiscal
quarter. If, as a result of year-end or other adjustments or corrections, the
Administrative Agent or the Borrowers determine that the Performance Level for
any fiscal quarter was different from that on which the then applicable Base
Rate Margin, Eurodollar Rate Margin, Tranche C Base Rate Margin, Tranche C
Eurodollar Rate Margin and/or Unused Commitment Fee were determined and if such
determination is made prior to the end of the related fiscal quarter, then the
required correction shall be made as of the first day of such fiscal quarter.
Borrowers shall promptly notify the Administrative Agent of any adjustment or
correction affecting the determination of the applicable Base Rate Margin,
Eurodollar Rate Margin, Tranche C Base Rate Margin, Tranche C Eurodollar Rate
Margin and Unused Commitment Fee from time to time.
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ARTICLE VI
CONDITIONS TO AGREEMENT'S EFFECTIVENESS,
LOANS AND LETTERS OF CREDIT
6.01. Conditions Precedent to Agreement Becoming Effective.
This Agreement shall become effective on December 12, 1996 (the "Effective
Date") provided that all of the following conditions precedent shall have been
satisfied (or waived by all Lenders) on or as of the Effective Date:
(a) Documents. The Administrative Agent shall have received
on or before the Effective Date all of the following:
(i) this Agreement and all other agreements, documents
and instruments relating to the loan and other credit transactions
contemplated by this Agreement and described in the List of Closing
Documents attached hereto as EXHIBIT J, each duly executed where
appropriate and in form and substance satisfactory to the
Administrative Agent; without limiting the foregoing, the Borrowers
hereby direct their counsel, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., to prepare and
deliver to the Administrative Agent, the Co-Agents, the Lenders, the
Issuing Banks and Sidley & Austin, the opinion referred to in such
List of Closing Documents;
(ii) an Officer's Certificate executed and delivered by the
presidents, vice presidents or treasurers of the Borrowers certifying
that all conditions precedent have been met and no Potential Event of
Default or Event of Default has occurred or is continuing; and
(iii) such additional documentation as the Administrative
Agent may reasonably request.
(b) No Legal Impediments. No law, regulation, order,
judgment or decree of any Governmental Authority shall, and the Administrative
Agent shall not have received any notice that litigation is pending or
threatened which is likely to (i) enjoin, prohibit or restrain the making of
any Loans and/or the issuance of Letters of Credit hereunder or (ii) result in
a Material Adverse Effect.
(c) No Change in Condition. No change in the business,
assets, management, operations, financial condition or prospects of either
Borrower or any Subsidiary of either Borrower shall have occurred since March
31, 1996, which change, in the judgment of the Administrative Agent, will, or
is reasonably likely to, result in a Material Adverse Effect. No change shall
have occurred since March 31, 1996 in the tax, capital, ownership, legal or
management structure of the Borrowers and
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their Subsidiaries. No material action, suit, claim or proceeding shall be
pending before any court or Governmental Authority or threatened which will, or
is reasonably likely to, either individually or in combination with one or more
other pending or threatened actions, suits, claims or proceedings, result in a
Material Adverse Effect.
(d) Interim Liabilities and Equity. Since March 31, 1996,
neither Borrower and no Subsidiary of either Borrower shall have (i) entered
into any material (as determined in good faith by the Administrative Agent)
commitment or transaction, including, without limitation, transactions for
borrowings and capital expenditures (other than with respect to the Utah
Distribution Center which are otherwise permitted under the July 1996 Credit
Agreement), which are not in the ordinary course of either Borrower's or its
Subsidiaries' respective businesses except with respect to the transactions
contemplated hereby, (ii) declared or paid any dividends or distributions,
except for dividends declared and made by a Subsidiary of either Borrower in
compliance with the July 1996 Credit Agreement, a schedule of which has been
provided to the Administrative Agent, (iii) established or assumed any
obligations with respect to compensation or employee benefit plans other than
the Plans in effect on March 31, 1996, or (iv) redeemed, repurchased, or issued
any Capital Stock, except pursuant to Permitted Equity Securities Options.
(e) No Loss of Material Agreements and Licenses. Since March
31, 1996, no agreement or license which, in the judgment of the Requisite
Lenders, is material to the business, operations or employee relations of
either Borrower or any Subsidiary of either Borrower shall have been
terminated, modified, revoked, breached or declared to be in default.
(f) No Market Changes. Since November 6, 1996, no material
adverse change shall have occurred in the conditions of the financial or
capital markets generally in the United States or the market for loan
syndications for transactions of this type, in each instance as determined by
the Administrative Agent in its sole discretion.
(g) No Default. No Event of Default or Potential Event of
Default shall have occurred and be continuing or would result from the making
of the Loans or the issuance of Letters of Credit.
(h) Representations and Warranties. All of the
representations and warranties contained in Section 7.01 and in any of the
other Loan Documents shall be true and correct in all material respects on and
as of the Effective Date.
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(i) Fees and Expenses Paid. There shall have been paid to
the Administrative Agent, for the accounts of the Lenders, the Issuing Banks,
and the Administrative Agent, as applicable, all fees and expenses due and
payable on or before the Effective Date, including, without limitation, all
fees and expenses due and payable pursuant to the 1995 Fee Letter and 1996 Fee
Letter.
(j) No Notice from Lenders. The Administrative Agent shall
not have received any notification from any Lender that any condition precedent
set forth in this Section 6.01 or Section 6.02 shall not have been satisfied.
(k) No Injunction. No Requirement of Law shall prohibit, and
no order, judgment or decree of any Governmental Authority shall enjoin,
prohibit or restrain any Lender from making Loans or any Revolving Lender or
any Issuing Bank from issuing or participating in the Letters of Credit
outstanding on the Effective Date.
6.02. Conditions Precedent to All Loans and Letters of
Credit. The obligation of each Lender to make any Loan requested to be made by
it on any Funding Date and the agreement of the Issuing Banks to issue any
Letter of Credit on any date is subject to the following conditions precedent
as of each such date, both before and after giving effect to the Loans to be
made and/or the Letter of Credit to be issued on such date:
(a) Representations and Warranties. All of the
representations and warranties of the Borrowers contained in Section 7.01 and
in any other Loan Document (other than representations and warranties which
expressly speak as of a different date) shall be true and correct in all
material respects.
(b) No Defaults. No Event of Default or Potential Event of
Default shall have occurred and be continuing or would result from the making
of the requested Loan or issuance of the requested Letter of Credit.
(c) No Legal Impediments. No law, regulation, order,
judgment or decree of any Governmental Authority shall, and the Administrative
Agent shall not have received from any Lender or an Issuing Bank notice that,
in the judgment of such Lender or such Issuing Bank, litigation is pending or
threatened which is likely to, enjoin, prohibit or restrain, or impose or
result in the imposition of any material adverse condition upon, (i) such
Lender's making of the requested Loan or participation in the requested Letter
of Credit or (ii) such Issuing Bank's issuance of the requested Letter of
Credit.
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(d) No Material Adverse Effect. No event shall have occurred
since the date of this Agreement which has resulted, or is reasonably likely to
result, in a Material Adverse Effect.
(e) Notice of Borrowing. A Notice of Borrowing completed,
executed and delivered in accordance with the requirements of Article II of
this Agreement shall have been delivered to the Administrative Agent.
Each submission by the Borrowers to the Administrative Agent of a Notice of
Borrowing with respect to any Loan or a Notice of Conversion/Continuation with
respect to any Loan, each acceptance by a Borrower of the proceeds of each Loan
made, converted or continued hereunder, each submission by the Borrowers to an
Issuing Bank of a request for issuance of a Letter of Credit and the issuance
of such Letter of Credit, shall constitute a representation and warranty by
the Borrowers as of the Funding Date in respect of such Loan, the date of
conversion or continuation and the date of issuance of such Letter of Credit,
that all the conditions contained in this Section 6.02 have been satisfied or
waived in accordance with Section 15.07.
6.03. Conditions Precedent to Tranche C Term Loans. The
obligation of each Tranche C Term Lender to make the Tranche C Term Loan
requested to be made by it hereunder is subject to the following conditions
precedent as of the requested Funding Date therefor, both before and after
giving effect to the Tranche C Term Loans to be made on such date:
(a) Section 6.02 Conditions Satisfied. The conditions
precedent set forth in Section 6.02 shall have been satisfied (or waived by all
Tranche C Term Lenders and the Administrative Agent).
(b) Preferred Stock. The Preferred Stock shall have been
issued in conformance with all Requirements of Law and Banner shall have
received a minimum of $27,800,000 in proceeds of the issuance of the Preferred
Stock and the aggregate net proceeds of the Preferred Stock received by Banner
shall have been used first to repay in full the ▇▇▇▇▇▇▇▇▇ Subordinated Debt and
thereafter to repay then outstanding Revolving Loans.
(c) Documents. The Administrative Agent shall have received
all of the following:
(i) Notes evidencing the Tranche C Term Loans executed by the
Borrowers and payable to the Tranche C Term Lenders;
(ii) Copies, in form and substance satisfactory to the
Administrative Agent, of all documents and agreements filed with the
Commission and all documents, agreements and legal
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opinions entered into or delivered in connection with the
issuance of the Preferred Stock, certified to be true and complete
copies thereof by the Secretary of Banner; and
(iii) An Officer's Certificate executed and delivered by the
presidents, vice presidents, or treasurers of the Borrowers certifying
that all conditions precedent set forth in this Section 6.03 have been
met.
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ARTICLE VII
REPRESENTATIONS AND WARRANTIES
7.01. Representations and Warranties of the Borrowers. In
order to induce the Administrative Agent, Co-Agents, Lenders and the Issuing
Banks to enter into this Agreement and to make the Loans and the other
financial accommodations to the Borrowers and their Subsidiaries and to issue
the Letters of Credit described herein, the Borrowers hereby jointly and
severally represent and warrant to each Lender, each Issuing Bank, the
Administrative Agent, and each Co-Agent that the following statements are true,
correct and complete:
(a) Organization; Corporate Powers. (i) Each Borrower and
each Subsidiary of the Borrowers (A) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, (B) is duly qualified to do business as a foreign corporation and
is in good standing under the laws of each jurisdiction in which failure to be
so qualified and in good standing will have or is reasonably likely to have a
Material Adverse Effect, (C) has filed and maintained effective (unless exempt
from the requirements for filing) a current Business Activity Report with the
appropriate Governmental Authority in the states of Minnesota and New Jersey,
and (D) has all requisite corporate power and authority to own, operate and
encumber its Property and to conduct its business as presently conducted and as
proposed to be conducted in connection with and following the consummation of
the transactions contemplated by this Agreement.
(ii) True, correct and complete copies of the Organizational
Documents identified on SCHEDULE 7.01-A attached hereto (or as modified to
include Organizational Documents delivered with respect to Persons acquired in
Permitted Acquisitions pursuant to Section 9.17) have been delivered to the
Administrative Agent, each of which is in full force and effect, has not been
modified or amended except to the extent indicated therein and, to the best of
each Borrower's knowledge, there are no defaults under such Organizational
Documents and no events which, with the passage of time or giving of notice or
both, would constitute a default under such Organizational Documents.
(b) Authority. (i) Each Borrower and each Subsidiary of
each Borrower has the requisite corporate power and authority (A) to execute,
deliver and perform each of the Loan Documents which have been executed by it
as required by this Agreement on or prior to the Effective Date and (B) to file
or record the Loan Documents which have been filed or recorded by it as
required by this Agreement on or prior to the Effective Date, with any
Governmental Authority.
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(ii) The execution, delivery, performance and filing or
recording, as the case may be, of each of the Loan Documents which have been
executed, filed or recorded as required by this Agreement on or prior to the
Effective Date and to which either Borrower or any Subsidiary of a Borrower is
party and the consummation of the transactions contemplated thereby, have been
duly approved by the respective boards of directors and, if necessary, the
shareholders of either Borrower or any Subsidiary of a Borrower and such
approvals have not been rescinded. No other corporate action or proceedings on
the part of either Borrower or any Subsidiary of a Borrower are necessary to
consummate such transactions.
(iii) Each of the Loan Documents to which either Borrower or
any Subsidiary of a Borrower is a party (A) has been duly executed, delivered,
filed or recorded, as the case may be, by it, (B) where applicable, creates
valid and perfected first Liens in the Collateral covered thereby securing the
payment of all of the Obligations purported to be secured thereby, (C)
constitutes such Person's legal, valid and binding obligation, enforceable
against it in accordance with its terms, and (D) is in full force and effect
and no material term or condition thereof has been amended, modified or waived
from the terms and conditions contained therein as delivered to the
Administrative Agent without the prior written consent of the Requisite
Lenders. All Borrower or Guarantor parties to the Loan Documents have performed
and complied with all the terms, provisions, agreements and conditions set
forth therein and required to be performed or complied with by such parties,
all filings and recordings and other actions which are necessary or desirable
to perfect and protect the Liens granted pursuant to the Loan Documents and
preserve their required priority have been duly taken, and no Potential Event
of Default, Event of Default or breach of any covenant by any such party exists
thereunder.
(c) Subsidiaries; Ownership of Equity Securities. SCHEDULE
7.01-C attached hereto (or as modified to include Permitted Acquisitions
pursuant to Section 9.17) (i) contains a diagram indicating the corporate
structure of the Borrowers, their Subsidiaries and any other Person in which
either Borrower or any such Subsidiary holds a direct or indirect partnership,
joint venture or other equity interest and indicates the nature of such
interest with respect to each Person included in such diagram; and (ii)
accurately sets forth (A) the correct legal name of such Person, the
jurisdiction of its incorporation or organization and the jurisdictions in
which it is qualified to transact business as a foreign corporation or
otherwise and (B) the authorized, issued and outstanding shares or interests of
each class of equity Securities of such Person and the owners of such shares or
interests. None of such issued and outstanding equity Securities is subject to
any vesting, redemption, or repurchase agreement, and there are no warrants or
options (other
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than Permitted Equity Securities Options) outstanding with respect to such
equity Securities. The outstanding equity Securities of each Borrower and each
Subsidiary of each Borrower are duly authorized, validly issued, fully paid and
nonassessable, and free and clear of any Liens, except for the Liens granted
pursuant to the Loan Documents and are not Margin Stock unless otherwise
disclosed on SCHEDULE 7.01-C.
(d) No Conflict. The execution, delivery and performance of
each of the Loan Documents to which either Borrower or any Subsidiary of a
Borrower is a party do not and will not (i) conflict with the Organizational
Documents of such Person a party thereto, (ii) constitute a tortious
interference with any Contractual Obligation of any Person or conflict with,
result in a breach of or constitute (with or without notice or lapse of time or
both) a default under any Requirement of Law or Contractual Obligation of
either Borrower or any such Subsidiary, or require termination of any
Contractual Obligation, the consequences of which violation, breach, default,
termination, conflict or interference, singly or in the aggregate, will, or is
reasonably likely to, result in a Material Adverse Effect or may subject the
Administrative Agent, any Co-Agent, any of the Lenders or any Issuing Bank to
any liability, (iii) result in or require the creation or imposition of any
Lien whatsoever upon any of the Property or assets of a Borrower or any such
Subsidiary, other than Liens contemplated by the Loan Documents, or (iv)
require any approval of shareholders of either Borrower or any such Subsidiary
which has not been obtained.
(e) Governmental Consents. Except as set forth on SCHEDULE
7.01-E attached hereto, the execution, delivery and performance of each of the
Loan Documents to which either Borrower or any Subsidiary of either Borrower is
a party do not and will not require any registration with, consent or approval
of, or notice to, or other action to, with or by any Governmental Authority,
except (i) filings, consents or notices which have been made, obtained or given
and (ii) filings necessary to create or perfect security interests in the
Collateral.
(f) Governmental Regulation. Neither Borrower and no
Subsidiary of either Borrower is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce
Act, or the Investment Company Act of 1940, or any other federal or state
statute or regulation which limits its ability to incur indebtedness or its
ability to consummate the transactions contemplated hereby or by the Loan
Documents.
(g) Restricted Junior Payments. Since March 31, 1995,
neither Borrower and no Subsidiary of either Borrower has directly or
indirectly declared, ordered, paid or made or set apart any sum or Property for
any Restricted Junior Payment or
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agreed to do so, except as permitted pursuant to Section 10.06 of this
Agreement.
(h) Financial Position. Copies of Banner's audited financial
statements for the Fiscal Year ended March 31, 1996 have been delivered to the
Administrative Agent on or before the Effective Date. All Financial Statements
included in such materials were prepared in all material respects in conformity
with GAAP, except as otherwise noted therein, and fairly present in all
material respects the respective consolidated financial positions, and the
consolidated results of operations and cash flows for each of the periods
covered thereby of the Borrowers and their Subsidiaries as at the respective
dates thereof. Neither the Borrowers nor any of their Subsidiaries have any
Accommodation Obligation, contingent liability or liability for any taxes,
long-term leases or commitments, not reflected in the audited Financial
Statements delivered to the Administrative Agent on or prior to the Effective
Date as aforesaid, which will have or are reasonably likely to result in a
Material Adverse Effect. The Projections delivered to the Administrative Agent
and Lenders were, as of the Effective Date, reasonable based on reasonable
assumptions and other information available to the Borrowers as of the
Effective Date.
(i) Indebtedness. SCHEDULE 1.01.8 attached hereto (or as
modified to include Indebtedness for borrowed money assumed in connection with
Permitted Acquisitions or of Persons acquired in Permitted Acquisitions) sets
forth all Indebtedness for borrowed money of the Borrowers and their
Subsidiaries and there are no defaults in the payment of principal or interest
on any such Indebtedness and no payments thereunder have been deferred or
extended beyond their stated maturity (except as disclosed on such Schedule).
Unless otherwise permitted under Section 10.01, as of the date of consummation
of any Permitted Acquisition, the Indebtedness for borrowed money of the Person
the stock or assets of which have been acquired through such Permitted
Acquisition, and all accrued and unpaid interest thereon, has been paid in full
in accordance with the express provisions of the instruments governing such
Indebtedness and none of such Person, the Borrowers or their Subsidiaries are
subject to any liability or Contractual Obligations with respect thereto.
(k) Litigation; Adverse Effects. Except as set forth in
SCHEDULE 7.01-K attached hereto, there is no action, suit, proceeding, Claim,
investigation or arbitration before or by any Governmental Authority or private
arbitrator pending or, to the knowledge of the Borrowers or any of their
Subsidiaries, threatened against either Borrower or any Subsidiary of either
Borrower or any of the Property (i) challenging the validity or the
enforceability of any of the Loan Documents, (ii) which will, or is reasonably
likely to, result in any Material Adverse Effect, or (iii) under the
Racketeering Influenced and Corrupt
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Organizations Act or any similar federal or state statute where such Person is
a defendant in a criminal indictment that provides for the forfeiture of
assets to any Governmental Authority as a criminal penalty. There is no material
loss contingency within the meaning of GAAP which has not been reflected in the
consolidated Financial Statements of the Borrowers and their Subsidiaries.
Neither Borrower and no Subsidiary of either Borrower is (A) in violation of any
applicable Requirements of Law which violation will result, or is reasonably
likely to result, in a Material Adverse Effect, or (B) subject to or in default
with respect to any final judgment, writ, injunction, restraining order or order
of any nature, decree, rule or regulation of any court or Governmental Authority
which will, or is reasonably likely to, result in a Material Adverse Effect.
(l) Compensation. Except (i) as disclosed in documents filed
with the Commission, (ii) as set forth on SCHEDULE 7.01-L attached hereto, and
(iii) for increases in the ordinary course of business and in accordance with
past practices, during the period commencing on the Closing Date and ending on
the Effective Date, neither Borrower and no Subsidiary of either Borrower has
increased or agreed to increase the aggregate compensation or benefits
(including severance benefits) payable or accruing to any past or present
officer of any of such Persons or any employee of any of such Persons having
management responsibilities.
(m) No Material Adverse Effect. Since March 31, 1995, there
has occurred no event with respect to either Borrower which has resulted, or is
reasonably likely to result, in a Material Adverse Effect.
(n) Tax Examinations. The IRS has examined Banner's
consolidated federal income tax returns for all tax periods prior to and
including the taxable year ending March 31, 1995. All deficiencies which have
been asserted against either Borrower or any Subsidiary of either Borrower as a
result of any federal, state, local or foreign tax examination for each taxable
year in respect of which an examination has been conducted have been fully paid
or finally settled or are being contested in good faith, and no issue has been
raised in any such examination which, by application of similar principles,
reasonably can be expected to result in assertion of a material deficiency for
any other year not so examined which has not been reserved for in Banner's
consolidated Financial Statements to the extent, if any, required by GAAP. To
the best of Borrowers' knowledge, neither Borrower nor any Subsidiary of either
Borrower has taken any reporting positions for which it does not have a
reasonable basis.
(o) Payment of Taxes. All tax returns and reports of each
Borrower and each Subsidiary of the Borrowers required to be
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filed have been timely filed, and all taxes, assessments, fees and other
charges of Governmental Authorities thereupon and upon or relating to their
respective Property, assets, income and franchises which are shown in such
returns or reports to be due and payable have been paid, except to the extent
(i) such taxes, assessments, fees and other charges are being contested in good
faith by an appropriate proceeding diligently pursued as permitted by the terms
of Section 9.04 and (ii) non-payment of the amounts thereof would not,
individually or in the aggregate, result in a Material Adverse Effect. Neither
Borrower has any knowledge of any proposed tax assessment against either
Borrower or any Subsidiary of either Borrower that will, or is reasonably
likely to, result in a Material Adverse Effect.
(p) Performance. Neither Borrower and no Subsidiary of
either Borrower has received any notice, citation, or allegation, nor has
actual knowledge, that (i) it is in default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
Contractual Obligation applicable to it, (ii) any of its Property is in
violation of any Requirement of Law, or (iii) any condition exists which, with
the giving of notice or the lapse of time or both, would constitute a default
with respect to any such Contractual Obligation, in each case, except where
such default or defaults or violation, if any, will not, or is not reasonably
likely to, result in a Material Adverse Effect.
(q) Disclosure. The representations and warranties of the
Borrowers and their Subsidiaries contained in the Loan Documents, and all
certificates and other documents delivered to the Administrative Agent pursuant
to the terms thereof, do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
contained herein or therein, in light of the circumstances under which they were
made, not misleading. Neither Borrower has intentionally withheld any fact
from the Administrative Agent, the Co-Agents, the Issuing Banks or the Lenders
in regard to any matter which will, or is reasonably likely to, result in a
Material Adverse Effect.
(r) Requirements of Law. Each Borrower and each Subsidiary
of the Borrowers is in compliance with all Requirements of Law applicable to it
and its respective business, in each case where the failure to so comply
individually or in the aggregate will, or is reasonably likely to, result in a
Material Adverse Effect.
(s) Environmental Matters. (i) Except as disclosed on
SCHEDULE 7.01-S attached hereto:
(A) the Borrowers and each of their Subsidiaries have all
material environmental, health and safety Permits required by
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and have complied in all material respects with, all applicable Environmental,
Health or Safety Requirements of Law, and have not received any unresolved
notices that any of their operations or Property are not in compliance, or are
the subject of any federal or state investigation evaluating whether any
Remedial Action is needed to respond to a Release into the environment;
(B) neither Borrower and no Subsidiary of either Borrower has
filed any notice (1) under any environmental Requirement of Law indicating past
or present treatment, storage, or disposal of a hazardous waste which would
give rise to a material Liability and Cost or (2) within the past five (5)
years reporting a spill or Release of a Contaminant into the environment;
(C) neither Borrower and no Subsidiary of either Borrower has
received notice from any Person, or is otherwise aware, that it is liable for
any material Liabilities and Costs arising from the Release of a Contaminant
into the environment;
(D) no Environmental Lien has attached to any of the
Property; and
(E) neither Borrower and no Subsidiary of either Borrower has
any material contingent liability in connection with Environmental, Health or
Safety Requirements of Law or the Release of a Contaminant into the
environment.
For purposes of this Section 7.01(s), "material" shall mean Liabilities and
Costs that the Borrowers reasonably believe will result in an expenditure of
over $500,000.
(t) ERISA. Borrowers have made available to the
Administrative Agent copies of all Plans that are currently maintained or
contributed to by either Borrower or any ERISA Affiliate of either Borrower in
respect of its respective employees or former employees and that are in
existence as of the date of this representation and warranty and copies of the
most recent annual reports (Form 5500 Series), including Schedule B thereto,
for such Plans. Each Plan currently maintained or contributed to by either
Borrower or any Subsidiary of either Borrower which is intended to be qualified
under Section 401(a) of the Internal Revenue Code as currently in effect has
been established so as to be qualified under Section 401(a) and either (i) has
received a favorable determination letter from the IRS that the Plan is so
qualified or (ii) an application for determination of such tax-qualified status
will be made to the IRS prior to the end of the applicable remedial amendment
period under Section 401(a) of the Internal Revenue Code as currently in
effect, and the appropriate Borrower or Subsidiary shall diligently seek to
obtain a determination letter with respect to such application. Except as
identified on SCHEDULE 7.01-T,
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neither Borrower and no Subsidiary of either Borrower maintains or contributes
to any employee welfare benefit plan within the meaning of Section 3(1) of
ERISA which provides benefits to employees after termination of employment
other than as required by Section 601 of ERISA. Neither Borrower nor any
Subsidiary of either Borrower has breached any of the responsibilities,
obligations or duties imposed on it by ERISA with respect to any Plan for which
either Borrower or any Subsidiary of either Borrower has any obligation to pay
a material amount of money or would in the future have any obligation to pay a
material amount of money. No other ERISA Affiliate has committed any such
breach which has given rise to, or would in the future give rise to, any
obligation of such ERISA Affiliate to pay money in excess of $250,000, and the
aggregate of all such breaches is not in excess of $1,000,000. No Benefit Plan
currently maintained or contributed to by either Borrower or any Subsidiary of
either Borrower has incurred any accumulated funding deficiency (as defined in
Sections 302(a)(2) of ERISA and 412(a) of the Internal Revenue Code) whether or
not waived for which either Borrower or any Subsidiary of either Borrower could
be directly or indirectly liable. No other Benefit Plan that is currently
maintained or contributed to by any ERISA Affiliate or with respect to which
any ERISA Affiliate has or may have any liability has outstanding any such
accumulated funding deficiency in excess of $250,000 and the aggregate of the
accumulated funding deficiency for all such Benefit Plans is not in excess of
$1,000,000. Neither Borrower nor any Subsidiary of either Borrower nor any
fiduciary or any trustee of any Plan of either Borrower or any Subsidiary of
either Borrower (i) has engaged in a nonexempt prohibited trans action
described in Section 406 of ERISA or Section 4975 of the Internal Revenue Code
or (ii) has taken or failed to take any action which would constitute or result
in a Termination Event in respect of which either Borrower or any Subsidiary of
either Borrower currently has any obligation to pay a material amount of money
or would in the future have any obligation to pay a material amount of money.
No other ERISA Affiliate or fiduciary of or any trustee to any Plan maintained
or contributed to by any other ERISA Affiliate has engaged in such a
transaction, or taken such action, which has given rise to, or would in the
future give rise to, an obligation of such ERISA Affiliate to pay money in
excess of $250,000, and the aggregate of all obligations to pay money for all
such transactions and actions is not in excess of $1,000,000. At January 1,
1995, the current value of the assets of all Benefit Plans currently maintained
or contributed to by the Borrowers and their Subsidiaries in respect of which
either Borrower could have, directly or indirectly, any liability was more than
the present value of the accrued benefits and other liabilities of all such
Benefit Plans and neither Borrower nor any Subsidiary of either Borrower knows
or has reason to know of any facts or circumstances occurring since January 1,
1995 which would materially and adversely change the value of such assets and
accrued benefits and other liabilities. At January 1, 1995
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the present value of the accrued benefits and other liabilities of all Benefit
Plans currently maintained or contributed to by all other ERISA Affiliates in
respect of which either Borrower or any Subsidiary of either Borrower has or
could have, directly or indirectly, any liability, does not exceed by more than
$5,000,000 the current value of the assets of such Benefit Plans and no such
other ERISA Affiliate knows or has reason to know of any facts or circumstances
occurring since January 1, 1995 which would materially and adversely change the
value of such assets and accrued benefits and other liabilities. Neither
Borrower nor any Subsidiary of either Borrower has made a complete or partial
withdrawal under Sections 4203 or 4205 of ERISA from a Multiemployer Plan as to
which any of them has any outstanding liability. No other ERISA Affiliate of
either Borrower has made such a withdrawal and has an outstanding liability
relating thereto in excess of $250,000 and the aggregate of such outstanding
liabilities for all such withdrawals does not exceed $1,000,000. Neither
Borrower and no ERISA Affiliate has incurred any liability to the PBGC which
remains outstanding other than the payment of premiums, and there are no
premium payments which have become due which are unpaid. Neither Borrower and
no ERISA Affiliate has failed to make a required contribution or payment to a
Multiemployer Plan on or before the due date therefor. Neither Borrower and no
ERISA Affiliate has failed to make a required installment or any other required
payment under Section 412 of the Internal Revenue Code on or before the due
date for such installment or other payment. Neither Borrower and no ERISA
Affiliate is required to provide security to a Benefit Plan under Section
401(a)(29) of the Internal Revenue Code due to a Benefit Plan amendment that
results in an increase in current liability for the plan year.
(u) Foreign Employee Benefit Matters. Neither Borrower nor
any Subsidiary of either Borrower or ERISA Affiliate maintains or contributes
to any Foreign Employee Benefit Plan or Foreign Pension Plan.
(v) Labor Matters. SCHEDULE 7.01-V accurately sets forth all
labor contracts to which either Borrower or any Subsidiary of either Borrower
is a party on the date hereof and the expiration date of each such contract.
There are no strikes, lockouts or other grievances relating to any collective
bargaining or similar agreement to which either Borrower or any Subsidiary of
either Borrower is a party.
(w) Securities Activities. Neither Borrower and no
Subsidiary of either Borrower is engaged in the business of extending credit
for the purpose of purchasing or carrying Margin Stock.
(x) Solvency. After giving effect to the Loans to be made,
the Letters of Credit to be issued, and the other Loan
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Documents to be executed and delivered on the Closing Date, the Effective Date,
or such other date as Loans requested hereunder are made or Letters of Credit
requested hereunder are issued, and the disbursement of the proceeds of such
Loans pursuant to the Borrowers' instructions, each Borrower and each Guarantor
is Solvent.
(y) Patents, Trademarks, Permits, Etc.; Government
Approvals. (i) Each Borrower and each Subsidiary of the Borrowers, as
applicable, owns, is licensed or otherwise has the lawful right to use, or has
all Permits and other governmental approvals, patents, trademarks, trade names,
copyrights, technology, know-how, permits and processes used in or necessary
for the conduct of its respective business as currently conducted which are
material to its condition (financial or otherwise), operations, performance and
prospects, taken as a whole. Except as set forth on SCHEDULE 7.01-Y attached
hereto, no claims are pending or, to the best of Borrowers' knowledge following
diligent inquiry, threatened that either Borrower or any Subsidiary of either
Borrower is infringing or otherwise adversely affecting the rights of any
Person with respect to such Permits and other governmental approvals, patents,
trademarks, trade names, copyrights, technology, know-how, permits and
processes, except for such claims and infringements as do not, in the
aggregate, give rise to any liability on the part of either Borrower or any
Subsidiary of either Borrower which will, or is reasonably likely to, result in
a Material Adverse Effect.
(ii) The consummation of the transactions contemplated by the
Loan Documents will not impair the ownership of or rights under (or the license
or other right to use, as the case may be) any Permits and governmental
approvals, patents, trademarks, trade names, copyrights, technology, know-how,
permits or processes by either Borrower or any Subsidiary of either Borrower in
any manner which will, or is reasonably likely to, result in a Material Adverse
Effect.
(z) Assets and Properties. Each Borrower and each Subsidiary
of the Borrowers has good and marketable title to all of the assets and
Property (tangible and intangible) owned by it (except insofar as marketability
may be limited by any laws or regulations of any Governmental Authority
affecting such assets), and all such assets and Property are free and clear of
all Liens except Liens securing the Obligations and Liens permitted under
Section 10.03. Substantially all of the assets and Property owned by, leased
to, or used by the Borrowers and/or each such Subsidiary is in adequate
operating condition and repair, ordinary wear and tear excepted, is free and
clear of any known defects except such defects as do not substantially
interfere with the continued use thereof in the conduct of normal operations,
and is able to serve the function for which they are currently being used,
except in each case where the failure of
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such asset to meet such requirements would not, or is not reasonably likely to,
result in a Material Adverse Effect. Neither this Agreement nor any other Loan
Document, nor any transaction contemplated under any such agreement, will
affect any right, title or interest of either Borrower or any Subsidiary of
either Borrower in and to any of such assets in a manner that would, or is
reasonably likely to, result in a Material Adverse Effect.
(aa) Insurance. SCHEDULE 7.01-AA attached hereto accurately
sets forth as of the Effective Date all insurance policies and programs
currently in effect with respect to the respective Property and assets and
business of the Borrowers and their Subsidiaries, specifying for each such
policy and program, (i) the amount thereof, (ii) the risks insured against
thereby, (iii) the name of the insurer and each insured party thereunder, (iv)
the policy or other identification number thereof, (v) the expiration date
thereof, (vi) the annual premium with respect thereto, and (vii) a list of
individual claims in an amount greater than $200,000 made thereunder during the
immediately preceding three (3) calendar years . Borrowers have made copies of
all such insurance policies available to the Administrative Agent. Such
insurance policies and programs are currently in full force and effect, in
compliance with the requirements of Section 9.05 and are in amounts sufficient
to cover the replacement value of the respective Property and assets of the
Borrowers and their Subsidiaries.
(bb) Pledge of Capital Stock. The grant and perfection of
the security interest in the Capital Stock of the Subsidiaries of the Borrowers
constituting a portion of the Collateral for the benefit of the Holders, as
contemplated by the terms of the Loan Documents, is not made in violation of
the registration provisions of the Securities Act, any applicable provisions of
other federal securities laws, state securities or "Blue Sky" law, foreign
securities law (except where a violation would not result in a material
reduction in the value of the Collateral taken as a whole), or applicable
general corporation law or in violation of any other Requirement of Law.
(cc) FAA Registration. Solair, Inc., Dallas Aerospace, Inc.,
D A C International, Inc., and Georgetown Jet Center, Inc. are the only
Subsidiaries of the Borrowers as of the Effective Date that own any Aircraft,
Airframes or jet Engines and Engines rated 750 or more take-off horsepower and
are the only such Subsidiaries as of the Effective Date whose Inventory and
Equipment are subject to Federal Aviation Administration registration
requirements.
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ARTICLE VIII
REPORTING COVENANTS
The Borrowers each covenant and agree that so long as any
Commitments are outstanding and thereafter until payment in full of all of the
Obligations (other than indemnities not yet due), unless the Requisite Lenders
shall otherwise give their prior written consent thereto:
8.01. Financial Statements. Each Borrower shall maintain,
and cause each of its Subsidiaries to maintain, a system of accounting
established and administered in accordance with sound business practices to
permit preparation of consolidated and consolidating Financial Statements in
conformity with GAAP (as in effect from time to time) and each of the Financial
Statements described below shall be prepared from such system and records. The
Borrowers shall deliver or cause to be delivered to the Administrative Agent
and the Lenders:
(a) Monthly Reports. As soon as practicable, and in any
event within (i) ninety (90) days after the end of the first month in each
Fiscal Year, (ii) seventy-five (75) days after the end of the second month in
each Fiscal Year, (iii) sixty (60) days after the end of the third month in
each Fiscal Year, and (iv) fifty (50) days after the end of each other fiscal
month in each Fiscal Year, (A) the consolidated and consolidating balance
sheets of Banner and its Subsidiaries as at the end of such period, and the
related consolidated and consolidating statements of income, and consolidated
statements of stockholders' equity and cash flow of Banner and its Subsidiaries
for such month, setting forth in each case, in a manner consistent with past
practices, the consolidated and consolidating figures for the corresponding
month of the previous Fiscal Year and the corresponding figures from the
consolidated financial forecast for the current Fiscal Year delivered pursuant
to Section 8.01(f) and (B) the consolidated and consolidating sales and EBITDA
for such month and for the period from the beginning of the then current Fiscal
Year on a comparative basis to the annual business plan for such Fiscal Year,
each of which reports described in clauses (A) and (B) herein is to be in
reasonable detail and certified by the chief financial officer, vice-president
of finance, treasurer or controller of Banner as fairly presenting the
consolidated and consolidating financial position of Banner and its
Subsidiaries as at the dates indicated and the results of their operations and
cash flow for the months indicated in accordance with GAAP, subject to changes
resulting from audit and normal year end adjustments.
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(b) Quarterly Reports. As soon as practicable, and in any
event within (i) sixty (60) days after the end of the first fiscal quarter in
each Fiscal Year and (ii) fifty (50) days after the end of each of the second
and third fiscal quarters in each Fiscal Year, (A) the consolidated and
consolidating balance sheets of Banner and its Subsidiaries as at the end of
such period and the related consolidated and consolidating statements of
income, and consolidated statements of stockholders' equity and cash flow of
Banner and its Subsidiaries for such fiscal quarter and for the period from the
beginning of the then current Fiscal Year to the end of such fiscal quarter,
setting forth in each case, in a manner consistent with past practices, the
consolidated and consolidating figures for the corresponding periods of the
previous Fiscal Year and the corresponding figures from the consolidated
financial forecast for the current Fiscal Year delivered pursuant to Section
8.01(f) and (B) the consolidated and consolidating sales and EBITDA for such
quarter and for the period from the beginning of the then current Fiscal Year
on a comparative basis to the annual business plan for such Fiscal Year, each
of which reports described in clauses (A) and (B) herein is to be in reasonable
detail and certified by the chief financial officer, vice-president of finance,
treasurer or controller of Banner as fairly presenting the consolidated and
consolidating financial position of the Borrowers and their Subsidiaries as at
the dates indicated and the results of their operations and cash flow for the
periods indicated in accordance with GAAP, subject to changes resulting from
audit and normal year end adjustments.
(c) Annual Reports. As soon as practicable, and in any event
within one hundred (100) days after the end of each Fiscal Year, (i) the
consolidated and consolidating balance sheets of Banner and its Subsidiaries as
at the end of such Fiscal Year and the related consolidated and consolidating
statements of income, and consolidated statements of stockholders' equity and
cash flow of Banner and its Subsidiaries for such Fiscal Year, setting forth in
each case, in a manner consistent with past practices, the consolidated and
consolidating figures for the previous Fiscal Year and the corresponding
figures from the consolidated financial forecast for the current Fiscal Year
delivered pursuant to Section 8.01(f) and (ii) the consolidated and
consolidating sales and EBITDA as of the end of such Fiscal Year on a
comparative basis to the annual business plan for such Fiscal Year, each of
which reports described in clauses (i) and (ii) herein is to be in reasonable
detail and accompanied by a (iii) report thereon of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or
other independent certified public accountants of recognized national standing
reasonably acceptable to the Lenders, which report shall be unqualified and
shall state that such Financial Statements fairly present the consolidated and
consolidating financial position of Banner and each of its Subsidiaries as at
the dates indicated and the results of their
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operations and cash flow and changes in financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years (except for changes with which ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or such other
independent certified public accountants, if applicable, shall concur and which
shall have been disclosed in the notes to the Financial Statements) and that
the examination by such accountants in connection with such consolidated and
consolidating Financial Statements has been made in accordance with generally
accepted auditing standards and (iv) statement of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or such
other independent certified public accountants confirming the calculations set
forth in the Officer's Certificate delivered simultaneously therewith pursuant
to Section 8.01(d).
(d) Officer's Certificate. Together with each delivery of
any Financial Statement pursuant to paragraphs (b) and (c) of this Section
8.01, (i) an Officer's Certificate of the Borrowers substantially in the form
of EXHIBIT K attached hereto and made a part hereof, stating that the officer
signatory thereto has reviewed the terms of the Loan Documents, and has made,
or caused to be made under his/her supervision, a review in reasonable detail
of the transactions and consolidated and consolidating financial condition of
the Borrowers and their Subsidiaries during the accounting period covered by
such Financial Statements, that such review has not disclosed the existence
during or at the end of such accounting period, and that such Person does not
have knowledge of the existence as at the date of such Officer's Certificate,
of any condition or event which constitutes an Event of Default or Potential
Event of Default, or, if any such condition or event existed or exists,
specifying the nature and period of existence thereof and what action the
Borrowers or any of their Subsidiaries has taken, is taking and proposes to
take with respect thereto; and (ii) a certificate (the "Compliance
Certificate"), signed by Banner's chief financial officer, vice-president of
finance, treasurer or controller, setting forth calculations (with such
specificity as the Administrative Agent may reasonably request) for the period
then ended which demonstrate compliance, when applicable, with the provisions
of Article XI.
(e) Annual Business Plans; Financial Projections. As soon as
practicable and in any event not later than sixty (60) days after the end of
each Fiscal Year, an annual business plan for the then next succeeding Fiscal
Year, substantially in the form attached hereto as EXHIBIT L.
(f) Monthly Officers' Certificates Regarding Investments,
Indebtedness and Foreign Inventory. Concurrently with the delivery of the
Financial Statements required by Section 8.01(a), an Officer's Certificate
setting forth, as of the last day of such fiscal month, (i) a summary of all
Indebtedness for borrowed money of, all other Indebtedness exceeding $250,000
in
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the aggregate of, and letters of credit issued for the account of, Foreign
Subsidiaries (if any) setting forth the outstanding balances of all such
Indebtedness, the changes in such balances from the last report, and Borrowers'
understanding as to the amount of the Unused Revolving Credit Facility, if any,
(ii) the outstanding balance of all Loans, the aggregate amount of all Letter
of Credit Obligations, and the undrawn face amount and reimbursement
obligations under letters of credit not issued pursuant to this Agreement,
(iii) with respect to each Letter of Credit issued or otherwise outstanding for
the account of a Borrower or any Subsidiary of a Borrower at any time during
such month or as to which there exists any Reimbursement Obligation, (A) the
date of issuance, type (i.e., Commercial or Standby), face amount and tenor of
such Letter of Credit and (B) all amounts available for drawing thereunder and
all Reimbursement Obligations with respect thereto and (iv) a report of the
Foreign Inventory setting forth its Total Book Value.
(g) Other Financial Information. With reasonable promptness
after the preparation or receipt thereof, (i) such other information, reports,
filings, projections, business plans and data with respect to the Borrowers and
their Subsidiaries as from time to time may reasonably be requested by any
Lender, (ii) appraisals of assets by appraisers satisfactory to the Requisite
Lenders and Borrowers as from time to time may reasonably be requested by the
Requisite Lenders, (iii) environmental reports as from time to time may
reasonably be requested by the Requisite Lenders, and (iv) appraisals,
environmental reports, fairness opinions, or financial statements and reports
of any Person which is the subject of a Permitted Acquisition; provided,
however, if compliance with such request referenced in clause (i) above could
not be accomplished without the services of outside consultants, accountants or
advisors and the cost to the Borrowers for such services would exceed $10,000,
Borrower shall only be required to comply with such request if made by the
Requisite Lenders.
(h) Annual Report to Shareholders. Promptly upon completion
thereof, the Annual Report to Shareholders for the Fiscal Year ending March 31,
1995, and each such Annual Report thereafter during the term of this Agreement.
8.02. Borrowing Base Certificate. As soon as practicable,
and in any event within thirty (30) days after the close of each calendar
month, the Borrowers shall provide the Administrative Agent with a Borrowing
Base Certificate as of the last day of the immediately preceding month,
together with a calculation of the Texas Tax Reserve as of such date and such
supporting documents as the Administrative Agent deems desirable, all certified
as being true and correct by the chief financial officer, vice-president of
finance, treasurer or controller of Banner. Notwithstanding the foregoing,
Borrowers may, at their sole election, provide the Administrative Agent with a
Borrowing
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Base Certificate more frequently than required hereinabove. Each Borrowing Base
Certificate delivered hereunder shall continue effective only during the period
commencing with the date of preparation thereof and ending on the earlier to
occur of (a) the last day of the month next succeeding the month in which such
Borrowing Base Certificate is delivered and (b) the date of preparation of the
next succeeding Borrowing Base Certificate delivered to the Administrative
Agent.
8.03. Events of Default. Promptly upon any of the chief
executive officer, chief operating officer, chief financial officer,
vice-president of finance, treasurer or controller of Banner or the treasurer
of Burbank obtaining knowledge (a) of any condition or event which constitutes
an Event of Default or Potential Event of Default, or becoming aware that any
Lender or the Administrative Agent has given any notice with respect to a
claimed Event of Default or Potential Event of Default under this Agreement,
(b) that any Person has given any notice to either Borrower or any Subsidiary
of either Borrower or taken any other action with respect to a claimed default
or event or condition of the type referred to in Section 12.01(e), or (c) of
any condition or event which has resulted, or is reasonably likely to result,
in a Material Adverse Effect or affect the value of, or the Administrative
Agent's interest in, the Collateral in any material respect, the Borrowers
shall deliver to the Administrative Agent and the Lenders an Officer's
Certificate specifying (i) the nature and period of existence of any such
claimed default, Event of Default, Potential Event of Default, condition or
event, (ii) the notice given or action taken by such Person in connection
therewith, and (iii) what action the Borrowers (or either of them) have taken,
are taking and/or propose to take with respect thereto.
8.04. Lawsuits and Other Proceedings. Promptly upon any of
the chief executive officer, chief operating officer, chief financial officer,
vice-president of finance, treasurer or controller of Banner or the treasurer
of Burbank, or internal legal counsel to either Borrower obtaining knowledge of
(a) the institution of, or threat of, any action, suit, proceeding,
governmental investigation or arbitration against or affecting either Borrower
or any Subsidiary of either Borrower or any of the Property not previously
disclosed pursuant to Section 7.01(k), or (b) any material development in any
action, suit, proceeding, governmental investigation or arbitration already
disclosed, which action, suit, proceeding, governmental investigation or
arbitration, or in the case of multiple actions, suits, proceedings,
governmental investigations or arbitrations arising out of the same general
allegations or circumstances, in either instance which is likely to result in a
Material Adverse Effect, the Borrowers shall give written notice thereof to the
Administrative Agent and the Lenders and provide such other information as may
be reasonably available to enable each Lender
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and the Administrative Agent and its counsel to evaluate such matters.
(c) Additional Reports Upon Request. In addition to the
requirements set forth in clauses (a) and (b) of this Section 8.04, the
Borrowers upon the reasonable request of the Administrative Agent or the
Requisite Lenders shall promptly give written notice of the status of any
action, suit, proceeding, governmental investigation or arbitration covered by
a report delivered pursuant to either of such clauses (a) or (b) and provide
such other information as may be reasonably available to it to enable each
Lender, the Co-Agents, and the Administrative Agent and its counsel to evaluate
such matters.
8.05. Insurance. By the last day of each Fiscal Year of
Banner and its Subsidiaries, the Borrowers shall deliver to the Administrative
Agent a report in form and substance reasonably satisfactory to the
Administrative Agent outlining all (a) material insurance coverage (including,
without limitation, comprehensive general liability insurance and aircraft
products liability insurance) maintained as of the date of such report by the
Borrowers and their Subsidiaries and the duration of such coverage and (b)
material insurance coverage (including, without limitation, comprehensive
general liability insurance and aircraft products liability insurance) planned
to be maintained by the Borrowers and their Subsidiaries in the subsequent
Fiscal Year.
8.06. ERISA Notices. The Borrowers shall, at the Borrowers'
expense:
(a) Notify the Administrative Agent promptly upon becoming
aware of the occurrence of any Termination Event, or a nonexempt
"prohibited transaction", as such term is defined in Section 4975 of
the Internal Revenue Code, in connection with (i) any Plan maintained
by or contributed to by either Borrower or any Subsidiary of either
Borrower or any trust created thereunder, or (ii) any other Plan or
any trust created thereunder, which Termination Event or non- exempt
prohibited transaction has given rise to, or would in the future give
rise to, an obligation of either Borrower or any ERISA Affiliate of
either Borrower to pay money in excess of $250,000 or to pay money in
a lesser amount, which when combined with the aggregate of all other
obligations to pay money for all such events and transactions of
either Borrower or any such ERISA Affiliate, exceeds $1,000,000, a
written notice specifying the nature thereof, what action either
Borrower or any Subsidiary of either Borrower, as applicable, has
taken with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the DOL or the PBGC with
respect thereto.
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(b) With reasonable promptness, deliver to the Administrative
Agent copies of (i) all notices received by either Borrower or any
ERISA Affiliate of the PBGC's intent to terminate any Benefit Plan
maintained by or contributed to by such Borrower or any of its ERISA
Affiliates or to have a trustee appointed to administer any such
Benefit Plan; (ii) upon the request of any Lender, each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed
by each Borrower or any of its ERISA Affiliates with the Internal
Revenue Service and the most recent actuarial report with respect to
any or all Benefit Plans maintained by or contributed to by such
Borrower or any of its ERISA Affiliates; (iii) all notices received by
each Borrower or ERISA Affiliate from a Multiemployer Plan sponsor,
pursuant to Section 4202 of ERISA, involving a withdrawal liability
payment of such Borrower or ERISA Affiliate in excess of $1,000,000;
(iv) all funding waiver requests filed by each Borrower or any of its
ERISA Affiliates with the Internal Revenue Service with respect to any
Benefit Plan maintained by or contributed to by such Borrower or any
of its ERISA Affiliates and all communications received by such
Borrower or any of its ERISA Affiliates from the Internal Revenue
Service with respect to any such funding waiver request; and (v) any
unfavorable determination letter received by each Borrower or any of
its ERISA Affiliates from the Internal Revenue Service regarding the
qualification of a Benefit Plan maintained by or contributed to by
such Borrower or any ERISA Affiliate under Section 401(a) of the
Internal Revenue Code.
(c) Notify the Administrative Agent promptly upon becoming
aware of any failure by either Borrower or any ERISA Affiliate to make
a required installment under Section 412 of the Internal Revenue Code
or any other required payment under Section 412 of the Internal
Revenue Code on or before the due date for such installment or
payment, if such failure would give rise to a Lien under Section
412(n) of the Internal Revenue Code.
For purposes of this Section 8.07, the Borrowers and any ERISA Affiliate shall
be deemed to know all facts known by the Administrator of any Plan of which
either Borrower or any ERISA Affiliate is the plan sponsor.
8.07. Environmental Notices. (a) The Borrowers shall notify
the Administrative Agent and the Lenders in writing, promptly upon any of the
chief executive officer, chief operating officer, chief financial officer,
vice-president of finance, treasurer or controller of Banner's or treasurer of
Burbank's learning thereof, of any:
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(i) written notice or claim to the effect that either
Borrower or any Subsidiary of either Borrower is or may be liable to
any Person as a result of the Release or threatened Release of any
Contaminant into the environment which could reasonably result in an
expenditure over $500,000;
(ii) written notice that either Borrower or any Subsidiary of
either Borrower is subject to investigation by any Governmental
Authority evaluating whether any Remedial Action is needed to respond
to the Release or threatened Release of any Contaminant into the
environment which could reasonably result in an expenditure over
$500,000;
(iii) written notice that any Property is subject to an
Environmental Lien;
(iv) written notice to either Borrower or any Subsidiary of
either Borrower of any violation of any Environmental, Health or
Safety Requirement of Law;
(v) written notice of the commencement or threat of any
judicial or administrative proceeding alleging a violation by either
Borrower or any Subsidiary of either Borrower of any Environmental,
Health or Safety Requirement of Law;
(vi) new or proposed changes to any existing Environmental,
Health or Safety Requirement of Law that could result in a Material
Adverse Effect;
(vii) any acquisition of stock, assets, real estate, or
leasing of property, or any other action by either Borrower or any
Subsidiary of either Borrower that could subject either Borrower or
any Subsidiary of either Borrower to environmental, health or safety
Liabilities and Costs which could reasonably result in an expenditure
over $500,000; or
(viii) any filing or report made by either Borrower or any
Subsidiary of either Borrower with any Governmental Authority with
respect to any unpermitted Release or threatened Release of a
Contaminant which could reasonably result in an expenditure over
$500,000.
(b) Within one hundred (100) days after the end of each
Fiscal Year, the Borrowers shall submit to the Administrative Agent and the
Lenders a report summarizing any change in the status of environmental, health
or safety compliance, hazard or liability issues identified in notices
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required pursuant to Section 8.07(a), disclosed on SCHEDULE 7.01-S or
identified in any notice or report required herein.
(c) Permit the Administrative Agent, any of the Lenders or
any of their respective agents or representatives, to inspect during normal
business hours each of the facilities and premises owned or operated by either
Borrower or any Subsidiary of either Borrower to confirm the matters of which
such notice is required to be given or with respect to which such report is
required to be given hereunder.
8.08. Other Reports. Promptly after the same are available,
the Borrowers shall deliver or cause to be delivered to the Administrative
Agent and the Lenders copies of all (a) Financial Statements, reports and
notices, registration statements and proxy statements or other filings, if any,
sent or made available generally by the Borrowers to their respective
Securities holders or filed with the Commission or other securities exchange
and all press releases made available generally by the Borrowers or
Subsidiaries of the Borrowers to the public concerning material developments in
the business of either Borrower or any such Subsidiary, and (b) reports, if
any, submitted to either Borrower or any Subsidiary of either Borrower or its
respective board of directors by its independent public accountants, including,
without limitation, any management report prepared in connection with the
annual audit.
8.09. Other Information. Promptly upon receiving a request
therefor from the Administrative Agent, a Co-Agent, or the Requisite Lenders,
the Borrowers shall prepare and deliver to the Administrative Agent and the
Lenders such other information with respect to the Borrowers, any of their
Subsidiaries, or the Collateral, including, without limitation, schedules
identifying and describing the Collateral and any dispositions thereof, as from
time to time may be reasonably requested by the Administrative Agent, the
Co-Agents, or the Requisite Lenders.
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ARTICLE IX
AFFIRMATIVE COVENANTS
Borrowers jointly and severally covenant and agree that so
long as any Commitments are outstanding and thereafter until payment in full of
all of the Obligations (other than indemnities not yet due), unless the
Requisite Lenders shall otherwise give prior written consent:
9.01. Corporate Existence, Etc. Each Borrower shall, and
shall cause each of its Subsidiaries to, at all times maintain its corporate
existence and preserve and keep, or cause to be preserved and kept, in full
force and effect its rights and franchises material to its businesses, except
where the loss or termination of such rights and franchises is not likely to
result in a Material Adverse Effect. Banner shall provide the Administrative
Agent and each Lender with a complete list of all of its Subsidiaries promptly
after any change in the list included as part of SCHEDULE 7.01-C.
9.02. Corporate Powers; Conduct of Business. Each Borrower
shall, and shall cause each of its Subsidiaries to, qualify and remain
qualified to do business and maintain its good standing in each jurisdiction in
which the nature of its business and the ownership of its Property requires it
to be so qualified and in good standing; provided, however, that such Persons
shall be permitted fifteen (15) days after their becoming aware of any failure
to so qualify or remain qualified in which to qualify or reinstate
qualification.
9.03. Compliance with Laws, Etc. Each Borrower shall, and
shall cause each of its Subsidiaries to, (a) comply with all Requirements of
Law and all restrictive covenants affecting it or its business, Property,
assets or operations and (b) obtain as needed all Permits necessary for its
operations and maintain such Permits in good standing, except in the case where
noncompliance with either clause (a) or (b) above is not reasonably likely to
result in a Material Adverse Effect.
9.04. Payment of Taxes and Claims; Tax Consolidation. Each
Borrower shall, and shall cause each of its Subsidiaries to, pay (a) all taxes,
assessments and other governmental charges imposed upon it or on any of its
Property or assets or in respect of any of its franchises, business, income or
Property before any penalty or interest accrues thereon, and (b) all Claims
(including, without limitation, claims for labor, services, materials and
supplies) for sums which have become due and payable and which by law have or
may become a Lien (other than a Lien permitted by Section 10.03) upon any of
such Borrower's or such Subsidiary's Property or assets, prior to the time when
any penalty or fine shall be incurred with respect thereto; provided,
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however, that no such taxes, assessments and governmental charges referred to
in clause (a) above or Claims referred to in clause (b) above need be paid if
being contested in good faith by appropriate proceedings diligently instituted
and conducted and if such reserve or other appropriate provision, if any, as
shall be required in conformity with GAAP shall have been made therefor.
Neither Borrower will, nor will it permit any of its Subsidiaries to, file or
consent to the filing of any consolidated income tax return with any Person
(other than the Borrowers and their Subsidiaries and their Affiliate, The
▇▇▇▇▇▇▇▇▇ Corporation).
9.05. Insurance. To the extent available at reasonable cost
from responsible and reputable insurance companies, the Borrowers shall
maintain for themselves and their Subsidiaries, or shall cause each of such
Subsidiaries to maintain in full force and effect the insurance policies and
programs listed on SCHEDULE 7.01-AA or substantially similar policies and
programs or other policies and programs (including, without limitation,
self-insurance programs) as are reasonably acceptable to the Administrative
Agent. All such policies and programs (other than self-insurance programs)
shall be maintained with responsible and reputable insurance companies or
associations, in such amounts and covering such risks as are usual for
companies engaged in similar businesses and owning similar property in the same
general geographic areas in which the Borrowers and/or their Subsidiaries
operate. Borrowers shall notify the Administrative Agent, in writing, in the
event any such policies and programs cease to be available (or cease to be
available at reasonable cost) from responsible and reputable insurance
companies. Each certificate and policy relating to Property damage, boiler and
machinery and/or business interruption with respect to (a) all Property located
in the United States and (b) Property having an insurable value in excess of
$250,000 located outside of the United States, shall contain an endorsement, in
form and substance acceptable to the Administrative Agent, showing loss payable
to the Administrative Agent, for the benefit of the Holders, and, if required
by the Administrative Agent, naming the Administrative Agent as an additional
insured under such policy. Each certificate and policy relating to coverage
other than the foregoing shall, if required by the Administrative Agent,
contain an endorsement naming the Administrative Agent as an additional insured
under such policy. Such endorsement or an independent instrument furnished to
the Administrative Agent shall provide that the insurance companies will give
the Administrative Agent at least thirty (30) days' written notice before any
such policy or policies of insurance shall be altered adversely to the
interests of the Holders or cancelled or not renewed and that no act, whether
willful or negligent, or default of either Borrower, any Subsidiary of either
Borrower or any other Person shall affect the right of the Administrative Agent
to recover under such
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policy or policies of insurance in case of loss or damage. In the event the
Borrowers or any of their Subsidiaries, at any time or times hereafter shall
fail to obtain or maintain policies of insurance substantially similar to those
listed on SCHEDULE 7.01-AA or to pay any premium in whole or in part relating
thereto, then the Administrative Agent may at any time or times thereafter (but
shall be under no obligation to do so) obtain and maintain such policies of
insurance and pay such premiums and take any other action with respect thereto
which the then Administrative Agent deems advisable under the circumstances.
All sums so disbursed by the Administrative Agent shall constitute Protective
Advances hereunder and be part of the Obligations, payable as provided in this
Agreement. The Administrative Agent shall inform the Borrowers promptly upon
its obtaining any such policies of insurance and payment of any such premiums.
Provided that the Administrative Agent obtains such policies of insurance and
the Borrowers promptly reimburse it for the Protective Advances disbursed in
connection therewith, no Event of Default shall result from Borrowers' failure
to maintain such insurance.
9.06. Inspection of Property; Books and Records;
Discussions. The Borrowers shall, and shall cause each of their Subsidiaries
to, permit any authorized representative(s) designated by the Administrative
Agent, any Co-Agent or any Lender to visit and inspect, whether by access to
Borrowers' and their Subsidiaries' MIS or otherwise, any of the Property, to
examine, audit, check and make copies of its respective financial and
accounting records, books, journals, orders, receipts and any correspondence
(other than privileged correspondence with legal counsel) and other data
relating to their respective businesses or the transactions contemplated hereby
or referenced herein (including, without limitation, in connection with
environmental compliance, hazard or liability), and to discuss their affairs,
finances and accounts with their officers, management personnel, and
independent certified public accountants, all upon reasonable written notice
and at such reasonable times during normal business hours, as often as may be
reasonably requested. Each such visitation and inspection (i) by or on behalf
of any Lender or Co-Agent (other than Citicorp) shall be at such Lender's or
Co-Agent's expense and (ii) by or on behalf of the Administrative Agent shall
be at the Borrowers' expense as provided in Section 15.02. The Borrowers shall
keep and maintain, and cause each of their Subsidiaries to keep and maintain,
in all material respects on its MIS and otherwise proper books of record and
account in which entries in conformity with GAAP shall be made of all dealings
and transactions in relation to its respective businesses and activities,
including, without limitation, transactions and other dealings with respect to
the Collateral. If an Event of Default has occurred and is continuing, the
Borrowers, upon the Administrative Agent's request, shall, and shall cause each
of their Subsidiaries to, turn over any such records to the Administrative
Agent or its representatives;
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provided, however, that the Borrowers may, in their discretion, retain copies
of such records. Borrowers shall deliver to the Administrative Agent any
instrument necessary for the Administrative Agent to obtain records (or copies
thereof) from any service bureau maintaining records for the Borrowers or any
of their Subsidiaries at any time the Administrative Agent would be entitled to
obtain such records (or copies thereof) from the Borrowers or their
Subsidiaries if the same were maintained by such Persons rather than a service
bureau.
9.07. Required Hedge Agreements. In the event three-month
LIBOR exceeds a rate equal to (a) eleven percent (11%) per annum minus (b) the
then effective Eurodollar Rate Margin minus (c) one-half of one percent (0.50%)
for a period of fifteen (15) consecutive Business Days, the Borrowers shall
enter into Hedge Agreements within forty-five (45) calendar days after the end
of such fifteen (15) Business Day period on terms by which the Borrowers are
protected against three-month LIBOR exceeding a rate equal to (i) eleven
percent (11%) per annum minus (ii) the then effective Eurodollar Rate Margin
for a minimum period of the lesser of (A) three (3) years and (B) one year less
than the then remaining term of this Agreement as to an aggregate notional
amount of not less than the amount equal to sixty percent (60%) of the sum of
(I) the then outstanding aggregate principal balance of the Loans. All such
Hedge Agreements shall be purchased from a commercial bank having total assets
in excess of $1,000,000,000 or such other Person reasonably acceptable as a
credit matter to the Administrative Agent. The Borrowers shall determine to
their own satisfaction whether such Hedge Agreements are sufficient to provide
protection and to meet their needs and none of the Administrative Agent, any
Co-Agent, the Issuing Banks or the Lenders shall have any obligation or
accountability with respect thereto or any obligation to propose, quote or
enter into any Hedge Agreement.
9.08. Insurance and Condemnation Proceeds. (a) Direction to
Insurers. Each Borrower hereby directs (and, if applicable, shall cause its
Subsidiaries to direct) all insurers under policies of Property damage, boiler
and machinery and business interruption insurance and payors of any
condemnation claim or award relating to the Property to pay all proceeds
payable under such policies or with respect to such claim or award directly to
the Administrative Agent, for the benefit of the Administrative Agent, the
Co-Agents, the Issuing Banks and the Lenders. In no case shall such proceeds be
payable to a Borrower or one or more Subsidiaries of a Borrower and the
Administrative Agent; provided, however, that in the event such proceeds are
payable to a Borrower or one or more Subsidiaries of a Borrower and the
Administrative Agent and the amount thereof exceeds $200,000, such Borrower or
Subsidiary(ies) shall promptly endorse the instrument evidencing such proceeds
to the
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Administrative Agent and deliver the same to the Administrative Agent.
(b) Application of Proceeds. In the event proceeds of
insurance received by the Administrative Agent under property damage, boiler
and machinery policies, business interruption insurance policies, or with
respect to a condemnation claim or award exceed $200,000 and do not constitute
Replacement Proceeds, the Administrative Agent shall, upon receipt of such
proceeds, apply all of the proceeds so received in repayment of the Obligations
in the manner set forth in Section 4.01(b)(vi). Notwithstanding the foregoing,
in the event proceeds of insurance received by the Administrative Agent under
property damage, boiler and machinery policies or business interruption
insurance policies (i) is equal to or less than $200,000 or (ii) constitutes
Replacement Proceeds, the Administrative Agent shall, upon receipt of such
proceeds, remit the amount so received to the Borrowers or a Subsidiary of a
Borrower, as applicable; provided, however, in the case of Replacement
Proceeds, if (i) the Administrative Agent receives notice from a Borrower that
it or its Subsidiary, as applicable, does not intend to restore, rebuild or
replace the Property subject to such insurance payment or condemnation award,
(ii) the Borrowers or the applicable Subsidiary fails to replace or commence
(and diligently pursue) the restoration or rebuilding of such Property within
180 days after the Administrative Agent's receipt of the Replacement Proceeds,
(iii) upon completion of the restoration, rebuilding or replacement of such
Property, the unused Replacement Proceeds from such insurance payment or
condemnation award exceed $200,000, then upon the occurrence of any such events
described above, all such proceeds or excess, as the case may be, shall
constitute Net Cash Proceeds of Sale received by the Borrowers or a Subsidiary
of the Borrowers and shall be applied to the Obligations pursuant to the terms
of Section 4.01(b). References in this Section 9.08(b) to replacement of
Property subject to insurance payments, if such Property is Inventory, shall be
deemed to include Inventory which is not necessarily of the identical type as
the insured Inventory to be replaced.
9.09. ERISA Compliance. Each Borrower shall, and shall
cause each of its Subsidiaries and ERISA Affiliates to, establish, maintain and
operate all Plans to comply in all material respects with the provisions of
ERISA, the Internal Revenue Code, all other applicable laws, and the
regulations and interpretations thereunder and the respective requirements of
the governing documents for such Plans.
9.10. Maintenance of Property. Each Borrower shall, and
shall cause each of its Subsidiaries to, maintain in all material respects all
of its respective owned and leased Property in good, safe and insurable
condition and repair, and not permit, commit or suffer any waste or abandonment
of any such Property
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and from time to time shall make or cause to be made all material repairs,
renewal and replacements thereof, including, without limitation, any capital
improvements which may be required; provided, however, that such Property may
be altered or renovated in the ordinary course of such Borrower's or such
Subsidiary's business and provided further that the foregoing requirements
shall not apply to obsolete Inventory and Equipment.
9.11. Condemnation. Promptly upon learning of the
institution of any proceeding for the condemnation or other taking of any of
the owned or leased Real Property of a Borrower or any Subsidiary of a
Borrower, the Borrowers shall notify the Administrative Agent of the pendency
of such proceeding, and permit the Administrative Agent to participate in any
such proceeding, and from time to time will deliver to the Administrative Agent
all instruments reasonably requested by the Administrative Agent to permit such
participation.
9.12. Future Liens on Real Property. Except to the extent
otherwise provided in Section 9.17, within five (5) calendar days after the
acquisition or leasing of any Real Property by a Borrower or a Subsidiary of a
Borrower, Borrowers shall notify the Administrative Agent of such acquisition
or lease and thereafter, upon the request of the Administrative Agent, the
Borrowers shall, and shall cause their Subsidiaries to, (a) execute and deliver
to the Administrative Agent, for the benefit of the Holders, (i) a mortgage,
deed of trust, assignment or other appropriate instrument evidencing a Lien
upon any such Real Property, lease or interest, within five (5) calendar days
after the date the Administrative Agent delivers the same to the Borrowers, and
(ii) such title insurance policies (mortgagee's form), certified surveys,
appraisals (which meet or exceed the minimum appraisal standards set forth in
the Financial Institutions Reform, Recovery and Enforcement Act (12 C.F.R.
Section 4 (1990)), as amended), and local counsel opinions with respect thereto
promptly after the Administrative Agent's request therefor, or (b) promptly
execute and deliver to, or obtain for, the Administrative Agent such other
agreements, documents and instruments which the Administrative Agent reasonably
deems necessary or desirable in view of the nature of the Property so acquired
or leased, such agreements described in clauses (a) and (b) to be in form and
substance acceptable to the Administrative Agent and such Property to be
subject only to (i) Liens permitted under Section 10.03 and (ii) such other
Liens as the Administrative Agent and Lenders may reasonably approve, it being
understood that the granting of such additional security for the Obligations is
a material inducement to the execution and delivery of this Agreement by each
Lender.
9.13. Consignee/Bailee Letters; Leased Inventory; Filings.
Each Borrower shall, and shall cause each of its Subsidiaries to, use its best
efforts to (a) obtain consignee or
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bailee letters (as applicable) substantially in the form attached hereto as
EXHIBIT M from each consignee or bailee in possession of Inventory of the
Borrowers and their Subsidiaries having a Total Book Value greater than
$100,000 promptly upon delivery of such Inventory to such consignee or bailee,
(b) cause to be executed and delivered to the Administrative Agent concurrently
with execution and delivery of such consignee or bailee letter, UCC financing
statements in form and substance satisfactory to the Administrative Agent with
respect to Inventory located on the premises of such consignee or bailee, and
(c) cause to be executed and delivered to the Administrative Agent promptly
after entering into any lease agreement with respect to Inventory having a
Total Book Value greater than $100,000 which is leased by a Borrower or a
Subsidiary of a Borrower to the lessee under such lease agreement, UCC
financing statements in form and substance satisfactory to the Administrative
Agent with respect to such leased Inventory; provided, however, that such
letters and financing statements shall be required for consignees/bailees and
lessees having possession, in the aggregate, of Inventory having a Total Book
Value exceeding ten percent (10.0%) of all Inventory of the Borrowers and their
Subsidiaries.
9.14. Maintenance of Tax Sharing Agreement. The Borrowers
shall maintain and cause to be maintained, in full force and effect, the Tax
Sharing Agreements, without amendment or modification.
9.15. Receivables, Inventory and Fixed Assets. The
Borrowers shall (a) promptly notify the Administrative Agent if either becomes
aware of anything materially detrimental to the creditworthiness of its
customers, in the aggregate, (b) conduct an annual (or more often when
reasonably requested by the Administrative Agent) physical count of the
Borrowers' and their Subsidiaries' Inventory and promptly after completion
thereof, if requested by the Administrative Agent, furnish a copy thereof to
the Administrative Agent, together with a report of the Total Book Value of
such Inventory, (c) promptly notify the Administrative Agent of any
dispositions of Equipment or Real Property of the Borrowers and their
Subsidiaries having a Fair Market Value in excess of $250,000, (d) settle or
adjust claims with respect to Receivables at no expense to the Administrative
Agent, subject to the provisions of Section 10.22 and (e) maintain all
Inventory at the locations required under the terms of the Loan Documents
pursuant to which Liens are granted therein (other than (i) Foreign Inventory
having an aggregate Total Book Value of up to (A) ten percent (10%) of the
aggregate Total Book Value of all Inventory of the Borrowers and their
Subsidiaries at any given time prior to the acquisition of the Capital Stock or
assets of Airline Rotables Ltd. and (B) fifteen percent (15%) of the aggregate
Total Book Value of all Inventory of the Borrowers and their Subsidiaries at
any given time after the acquisition of the Capital Stock or assets of Airline
Rotables Ltd., (ii)
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Foreign Inventory in a location other than the Republic of Germany and, after
the acquisition of Airline Rotables Ltd., the United Kingdom having an
aggregate Total Book Value of up to three percent (3%), and (iii) Inventory
sold in the ordinary course of business). Borrowers shall, and shall cause
their Subsidiaries to, execute and deliver such agreements and instruments as
may be required under the local jurisdiction's Requirements of Law to grant and
perfect Liens on Foreign Inventory located in the Republic of Germany, the
United Kingdom, and in any other jurisdiction outside of the United States in
which Inventory of the Borrowers and their Subsidiaries having an aggregate
Total Book Value equal to or exceeding $3,000,000 is located.
9.16. Environmental Compliance. Each Borrower shall, and
shall cause its Subsidiaries to, comply in all material respects with
applicable Environmental, Health and Safety Requirements of Law.
9.17. Acquisitions of Engines and Airframes; Permitted
Acquisitions. The Borrowers shall notify the Administrative Agent, in writing,
upon the acquisition by a Borrower or any Subsidiary of a Borrower, of any
Aircraft, Airframe or Engine and shall cause such Person making such
acquisition to execute and deliver to the Administrative Agent an Aircraft
Mortgage. Concurrently with the consummation of any Permitted Acquisition, the
Borrowers (a) shall cause the Person acquired, if such Permitted Acquisition is
an acquisition of Capital Stock, to execute and deliver to, or obtain for, the
Administrative Agent, for the benefit of the Holders, a guaranty of the
Obligations in form and substance substantially similar to the guaranties
theretofore executed by Guarantors and such other Loan Documents as the
Administrative Agent shall have requested to grant, perfect and protect senior
Liens against the Property of such Person to secure the Obligations or (b)
shall, or shall cause the Subsidiary of a Borrower acquiring assets (including,
without limitation Capital Stock) in such Permitted Acquisition to, execute and
deliver to, or obtain for, the Administrative Agent for the benefit of the
Holders, such Loan Documents as the Administrative Agent shall have requested
to perfect and protect senior Liens against the Property which is the subject
of such Permitted Acquisition and (c) shall deliver to the Administrative Agent
Organizational Documents of the Person which is the subject of such Permitted
Acquisition, if such Permitted Acquisition is an acquisition of Capital Stock
and an amended SCHEDULE 7.01-A and an amended SCHEDULE 7.01-C reflecting the
modifications to such Schedules attached hereto necessitated by consummation of
such Permitted Acquisition.
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ARTICLE X
NEGATIVE COVENANTS
Borrowers jointly and severally covenant and agree that they
shall comply with the following covenants so long as any Commitments are
outstanding and thereafter until payment in full of all of the Obligations
(other than indemnities not yet due), unless the Requisite Lenders shall
otherwise give prior written consent:
10.01. Indebtedness. Neither Borrower shall, nor shall
either Borrower permit any of its Subsidiaries to directly or indirectly
create, incur, assume or otherwise become or remain directly or indirectly
liable with respect to any Indebtedness, except:
(a) the Obligations;
(b) Indebtedness for trade payables, wages and other accrued
expenses incurred in the ordinary course of business;
(c) the Transaction Costs which have not been paid on or as
of the Effective Date;
(d) Permitted Existing Indebtedness;
(e) to the extent permitted by Article XI and in any event in
an aggregate amount not to exceed $3,000,000 at any time, Indebtedness
under Capital Leases and Indebtedness evidenced by industrial revenue
bonds;
(f) Purchase Money Indebtedness (i) related to the Utah
Distribution Center and otherwise permitted by Section 10.01(m), (ii)
related to the purchase of the Airbus Inventory, and (iii) related to
other purchases in an aggregate amount not exceeding $500,000;
(g) Indebtedness in respect of taxes, assessments,
governmental charges and Claims for labor, materials or supplies, to
the extent that payment thereof is not required pursuant to Section
9.04;
(h) Indebtedness constituting Accommodation Obligations
permitted by Section 10.05;
(i) Intercompany Debt;
(j) Indebtedness in respect of the Hedge Agreements (i)
required under Section 9.07 and (ii) in
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respect of foreign exchange contracts entered into in the ordinary
course of business; and
(k) Indebtedness under appeal bonds in connection with
judgments which do not result in an Event of Default or a Potential
Event of Default or any other breach hereunder, provided that the
aggregate amount of all such Indebtedness does not exceed $500,000;
(l) Indebtedness not to exceed $7,000,000 in the aggregate
incurred in connection with the Utah Distribution Center, including,
without limitation, Capital Expenditures made in connection with the
Utah Distribution Center;
(m) ▇▇▇▇▇▇▇▇▇ Subordinated Debt, provided that no advance of
▇▇▇▇▇▇▇▇▇ Subordinated Debt shall be made at any time an Event of
Default or Potential Event of Default shall have occurred and be
continuing unwaived;
(n) other unsecured Indebtedness not to exceed $5,000,000 in
the aggregate at any time outstanding; and
(o) any extensions, renewals, refundings or replacements of
any of the foregoing described in clauses (b) through (l) or (n) and
any extensions of the maturity of the ▇▇▇▇▇▇▇▇▇ Subordinated Debt;
provided that any such extension, renewal, refunding or replacement is
in an aggregate principal amount not greater than the principal amount
of, and is on terms no less favorable to the Borrower obligor or
Subsidiary obligor than the terms of, the permitted Indebtedness so
extended, renewed, refunded or replaced.
No Indebtedness for borrowed money permitted hereunder, except for Permitted
Existing Indebtedness to the extent otherwise provided in the agreements
governing the same as of the Closing Date, shall contain any provisions making
a "default" under or in respect of some other Indebtedness for borrowed money a
"default" thereunder, unless such cross-default provisions (i) are applicable
only with respect to "defaults" which have resulted in the acceleration of
payment of obligations for borrowed money not incurred in connection with the
acquisition of the Utah Distribution Center in an amount not more than
$3,000,000 in any particular case or (ii) are applicable with respect to
"defaults" which have resulted in the acceleration of payment of obligations
for borrowed money incurred in connection with the acquisition of the Utah
Distribution Center in an amount not more than $7,000,000 but the obligee of
such obligations has executed and delivered to the Administrative Agent
agreements with respect to mortgagee waivers and other intercreditor matters
deemed necessary by the Administrative Agent.
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10.02. Sales of Assets. Neither Borrower shall, nor shall
either Borrower permit any of its Subsidiaries to sell, assign, transfer,
exchange, lease, convey or otherwise dispose of any Property, whether now owned
or hereafter acquired, or any income or profits therefrom, or enter into any
agreement to do so, except:
(a) the sale of Property having a Fair Market Value not
exceeding $250,000 in any twelve (12) month period for consideration
not less than the Fair Market Value thereof so long as (i) any
non-cash consideration resulting from such sale shall be pledged or
assigned to the Administrative Agent, for the benefit of the Holders,
pursuant to an instrument in form and substance acceptable to the
Administrative Agent and (ii) the Borrowers comply with the mandatory
prepayment provisions set forth in Section 4.01(b) and the conditions
to the release of Collateral described in Section 13.09(c);
(b) the transfer of Property (i) from a Subsidiary of a
Borrower to such Borrower or (ii) from a Subsidiary of a Borrower to
another Subsidiary of such Borrower, provided that the Subsidiary
transferee is a Guarantor;
(c) the sale (including, without limitation, sales on
consignment), exchange or lease of Inventory in the ordinary course of
the respective Borrower's or a Borrower's respective Subsidiary's
respective businesses;
(d) the disposition of Equipment if (i) such Equipment is
obsolete or no longer useful in the ordinary course of a Borrower's or
such Subsidiary's business, or (ii) within six (6) months after such
disposition, an amount equal to the proceeds therefrom is either (A)
used to finance the purchase or lease of replacement Equipment and the
seller thereof delivers to the Administrative Agent evidence of such
use and that the replacement Equipment is free and clear of all Liens
except those created under the Loan Documents or (B) delivered to the
Administrative Agent for application to the repayment of the
Obligations pursuant to the mandatory prepayment provisions set forth
in Section 4.01(b);
(e) the sale of Investments in Cash Equivalents permitted
pursuant to Section 10.04(a);
(f) the sale of Real Property of ▇▇▇▇▇ Industries, Inc. which
is located in Suffield, Connecticut, and Real
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Property of Matrix Aviation, Inc. which is located in Wichita, Kansas;
provided that (i) the consideration received therefor equals or
exceeds the book value thereof and (ii) the Borrowers comply with the
mandatory prepayment provisions set forth in Section 4.01(b) and the
conditions to the release of Collateral described in Section 13.09(c);
(g) the sale of the Investment described in Section 10.04(g);
(h) the sale of warrants for Capital Stock of Interactive
Flight Technologies, Inc. received by Banner;
(i) the sale of Property permitted pursuant to Section 10.11;
(j) the sale of up to a fifty percent (50%) interest in the
Capital Stock of Aero International, Inc. to RHI; and
(k) the transfer of shares of the Capital Stock of FSBC and
FSBC International to RHI in exchange for shares of Banner issued to
RHI in consideration of the acquisition of such Capital Stock of FSBC
and FSBC International as Permitted Acquisitions.
Notwithstanding anything to the contrary in this Article X, any sale or
transfer of Collateral (other than sales, assignments, transfers, exchanges,
leases, conveyances, or other dispositions of Collateral described in this
Section 10.02), either singly or in a series of related sales or transfers,
having a value based upon the higher of its Total Book Value or appraised Fair
Market Value in excess of (i) $2,000,000, exclusive of such value of any
Inventory consisting of consigned goods, or (ii) $3,000,000, inclusive of such
value of any Inventory consisting of consigned goods, shall require the prior
written approval of Lenders whose Pro Rata Shares, in the aggregate, are at
least eighty percent (80%).
10.03. Liens. Neither Borrower shall, nor shall either
Borrower permit any of its Subsidiaries to directly or indirectly create,
incur, assume or permit to exist any Lien on or with respect to any of their
respective Property or assets except:
(a) Liens created pursuant to the Loan Documents;
(b) Permitted Existing Liens; provided, however that the
Indebtedness secured by such Liens may not exceed the amount thereof
as of the Closing Date;
(c) Customary Permitted Liens;
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(d) purchase money Liens (including the interest of a lessor
under a Capital Lease or an Operating Lease having substantially the
same economic effect) created in connection with the incurrence of
Indebtedness permitted by Section 10.01(f) which is not in default or
foreclosure and Liens arising under retention of title by the seller
of the Airbus Inventory pursuant to the purchase contract executed and
delivered with respect thereto;
(e) Liens with respect to judgments which do not result in an
Event of Default or Potential Event of Default;
(f) any interest or title of a lessor or secured by a
lessor's interest in tangible Property which is leased under any lease
permitted by this Agreement;
(g) Liens identified as permitted Liens in the Loan Documents
providing for mortgage interests in favor of the Administrative Agent
in either Borrower's or any Subsidiary of either Borrower's Real
Property;
(h) Liens against the Real Property consisting of the Utah
Distribution Center, improvements thereon and fixtures attached
thereto to secure Indebtedness incurred by Banner Distribution, Inc.
which is permitted by Section 10.01(m); provided that the holder of
such Liens shall have entered into an intercreditor agreement and/or
mortgagee waiver with the Administrative Agent, in form and substance
satisfactory to the Administrative Agent;
(i) Liens granted to the lessors under the Permitted Engine
Leases against the rights of Dallas Aerospace, Inc. under subleases
of Engines which are the subject of the respective lessors' Permitted
Engine Leases to Persons other than a Borrower or Subsidiary of a
Borrower;
(j) Liens granted by Guarantors against accounts which they
are permitted to establish and maintain under Sections 4.04 and 10.16
without being subject to Collection Account Agreements to secure
Contractual Obligations with respect to credit card purchases;
provided that the amount on deposit in such accounts of any Guarantor
shall be no more than $75,000 in the aggregate at any given time and
such Guarantor shall have identified such account(s) and Contractual
Obligations to the Administrative Agent in writing promptly upon
entering into the same; and
(k) extensions, renewals, and replacements of Liens referred
to in clauses (a), (b), (d), (g) and (h) of this Section 10.03;
provided that (i) any such extension, renewal, or replacement of a
Lien referred
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to in clauses (b), (d), (g) and (h) shall be limited to the Property
covered by the Lien extended, renewed, or replaced, (ii) the
obligations secured by any such extension, renewal, or replacement
Lien shall be in an amount not greater than the amount of the
obligations secured by the Lien extended, renewed, or replaced
immediately prior to such extension, renewal or replacement, and (iii)
such extension, renewal or replacement Lien shall be subject to the
same intercreditor terms in favor of the Administrative Agent as the
Lien extended, renewed, or replaced, if any.
10.04. Investments. Neither Borrower shall, nor shall
either Borrower permit any of its Subsidiaries to, directly or indirectly make
or own any Investment except:
(a) Investments in Cash Equivalents;
(b) Permitted Existing Investments in an amount not exceeding
the amount thereof outstanding on the Closing Date, in each case
increased or decreased as required under GAAP as a result of annual
adjustments made to Investments accounted for under the equity method;
(c) Investments in the form of advances or loans to, and
residential property acquired from, employees in the ordinary course
of business; and other loans to employees for purchases of options on
the Capital Stock of a Borrower or a Subsidiary of either Borrower, in
an aggregate amount not to exceed at any time outstanding (i) to any
individual employee, $100,000 or (ii) to all employees, $500,000;
(d) Investments by a Borrower in its Subsidiaries which, if
in the form of Intercompany Debt, would be permitted under Section
10.01(j);
(e) Investments which represent defaulted or extended
obligations previously contracted in the ordinary course of business
and payable on terms necessary to effectuate the collection thereof,
in an aggregate amount not to exceed at any time outstanding
$1,000,000;
(f) Investments in connection with sales of assets consented
to by the Requisite Lenders;
(g) Intentionally omitted
(h) Investments in an aggregate amount not to exceed
$35,000,000 in Permitted Acquisitions and newly formed Subsidiaries to
effect the Permitted Acquisitions of Airline
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Rotables Ltd., Air Marine Accessories, Inc., and Air Marine Sales,
Inc; and
(i) Investments in addition to those permitted under clauses
(a) through (h) above made other than in the ordinary course of
business in an aggregate amount not exceed at any time outstanding
$2,000,000.
In no event shall either Borrower or any Subsidiary of either Borrower create
any Subsidiary which is not (i) included in SCHEDULE 7.01-C as of the Effective
Date, (ii) a Canadian Subsidiary or corporation formed under the laws of
Singapore for the primary purpose of owning or leasing a warehouse facility in
Canada or Singapore in which Inventory of the Borrowers and their Subsidiaries
is to be located, or (iii) created by virtue of consummation of a Permitted
Acquisition or to consummate the Permitted Acquisitions of Airline Rotables
Ltd., Air Marine Accessories, Inc., and Air Marine Sales, Inc..
10.05. Accommodation Obligations. Neither Borrower shall,
nor shall either Borrower permit any of its Subsidiaries to, directly or
indirectly create or become or be liable with respect to any Accommodation
Obligation, except:
(a) recourse obligations resulting from endorsement of
negotiable instruments for collection in the ordinary course of its
business;
(b) Permitted Existing Accommodation Obligations and any
extensions, renewals or replacements thereof, provided that the
aggregate Indebtedness of the applicable Borrower or Subsidiary under
any such extension, renewal or replacement is not greater than the
Indebtedness of such Borrower or Subsidiary under, and shall be on
terms no less favorable to the obligor Borrower or Subsidiary than the
terms of, the Permitted Existing Accommodation Obligation so extended,
renewed or replaced;
(c) Accommodation Obligations arising under the Loan
Documents;
(d) obligations, warranties and indemnities which (i) are
undertaken or made in the ordinary course of business, (ii) are not in
favor of an Affiliate, and (iii) do not relate to Indebtedness which
is in default;
(e) guaranties (i) by Banner of Operating Leases of Burbank
payments under which do not aggregate more than $500,000 in any given
Fiscal Year, (ii) by Banner of Burbank's Contractual Obligation with
respect to the
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purchase of the Airbus Inventory, and (iii) of Indebtedness of a
Subsidiary of Banner (other than Burbank) or a Subsidiary of Burbank
arising under any Capital Lease or Operating Lease under which such
Subsidiary is the lessee;
(f) the guarantee by Banner of the Indebtedness of Banner
Distribution, Inc. described in Section 10.03(h) and an environmental
liability indemnity in favor of the holder of such Indebtedness; and
(g) other Accommodation Obligations not to exceed $500,000 in
the aggregate at any time outstanding.
10.06. Restricted Junior Payments. Neither Borrower shall,
nor shall either Borrower permit any of its Subsidiaries to declare or make any
Restricted Junior Payment, except:
(a) dividends or distributions made in order to facilitate
the repayment of Intercompany Debt;
(b) dividends or distributions to a Borrower on the Capital
Stock of any of its Subsidiaries or to any of a Borrower's
Subsidiaries from any other Subsidiary of such Borrower or any
Subsidiary of such Borrower;
(c) dividends or distributions on the Capital Stock of
Banner; provided that (i) the aggregate amount of such dividends and
distributions shall not exceed $150,000 in any Fiscal Year, (ii) no
Event of Default shall exist as of the date of declaration or payment
of any such dividend or distribution or result therefrom, and (iii)
Banner shall have provided the Administrative Agent with written
notice of the date on which any such dividend or distribution is to be
made no less than ninety (90) days prior to such date;
(d) the redemption, repurchase or exchange of shares of the
Capital Stock of Banner made as permitted in Section 10.02(k); and
(e) the prepayment of the ▇▇▇▇▇▇▇▇▇ Subordinated Debt from
proceeds of the Preferred Stock.
10.07. Restriction on Operating Leases. During any Fiscal
Year, neither Borrower shall, nor shall either Borrower permit any of its
Subsidiaries to, become liable in any way, whether directly or indirectly or by
assignment or by Accommodation Obligation, for the obligations of the lessee
under any Operating Lease (other than the Permitted Engine Leases) unless,
immediately after giving effect to the incurrence of liability with respect to
such Operating Lease, the amount of all Consolidated Rental Payments for such
Fiscal Year (exclusive of
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any reimbursement for taxes, insurance, maintenance or other expenses) do not
exceed $4,850,000.
10.08. Conduct of Business. Neither Borrower shall, nor
shall either Borrower permit any of its Subsidiaries to, engage in any business
other than the businesses engaged in by the Borrowers and their Subsidiaries on
the Closing Date and the business consisting of the distribution and marketing
of aircraft after-market parts and components.
10.09. Transactions with Shareholders and Affiliates.
Neither Borrower shall, nor shall either Borrower permit any of its
Subsidiaries to, directly or indirectly enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
the Borrowers on terms that are less favorable to such Borrower or Subsidiary,
as applicable, than those that might be obtained in an arm's length transaction
at the time from Persons who are not such an Affiliate other than pursuant to
those management contracts and service agreements identified on SCHEDULE 10.09,
as such management contracts and service agreements may be amended,
supplemented or modified without materially impairing such Borrower's or
Subsidiary's ability to repay its Obligations. Nothing contained in this
Section 10.09 shall prohibit any transaction expressly permitted by Sections
10.05 and 10.06 or any other Section of this Agreement.
10.10. Restriction on Fundamental Changes. Neither Borrower
shall, nor shall either Borrower permit any of its Subsidiaries to, (a) enter
into any merger or consolidation, or liquidate, wind-up or dissolve (or suffer
any liquidation or dissolution), or convey, lease, sell, transfer or otherwise
dispose of, in one transaction or series of transactions, all or substantially
all of such Person's business or Property, whether now or hereafter acquired,
except for (i) the merger of a Subsidiary of a Borrower with and into a
Borrower or (ii) the merger of a Guarantor with and into another Guarantor or
(b) acquire by purchase or otherwise, all or substantially all of the business,
property or assets of, or Capital Stock or other evidence of beneficial
ownership of, any Person,except for acquisitions which are Permitted
Acquisitions.
10.11. Sales and Leasebacks. Except with respect to the
Property identified on SCHEDULE 10.11 attached hereto, neither Borrower shall,
nor shall either Borrower permit any of its Subsidiaries to, become liable,
directly, by assumption or by Accommodation Obligation, with respect to any
lease, whether an Operating Lease or a Capital Lease, of any Property (whether
real or personal or mixed) which it or one of its Subsidiaries (a) sold or
transferred or is to sell or transfer to any other Person, or (b) intends to
use for substantially the same purposes
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as any other Property which has been or is to be sold or transferred by it or
one of its Subsidiaries to any other Person, in either instance, in connection
with such lease, unless, after giving effect to each such lease Borrowers are
in compliance with Section 10.07.
10.12. Margin Regulations; Securities Laws. Neither
Borrower shall, nor shall either Borrower permit any of its Subsidiaries to,
use all or any portion of the proceeds of any credit extended under this
Agreement to purchase or carry Margin Stock or to violate the Securities
Exchange Act or the Securities Act as in effect on the date or dates of such
use of proceeds.
10.13. ERISA. Neither Borrower shall:
(a) engage, or permit any of its Subsidiaries to engage, in
any prohibited transaction described in Sections 406 of ERISA or 4975
of the Internal Revenue Code for which a statutory or class exemption
is not available or a private exemption has not been previously
obtained from the DOL and in connection with which it could be subject
to either a civil penalty assessed pursuant to Section 502(i) of ERISA
in excess of $250,000 or a tax imposed by Section 4975 of the Internal
Revenue Code in excess of $250,000 or it and all ERISA Affiliates
could be subject to aggregate penalties and taxes in excess of
$1,000,000 for all such prohibited transactions;
(b) permit to exist any accumulated funding deficiency (as
defined in Sections 302 of ERISA and 412 of the Internal Revenue Code)
or fail to pay any installment necessary to amortize each waived
funding deficiency with respect to any Benefit Plan contributed to or
maintained by it or any of its ERISA Affiliates;
(c) fail to make any contribution or payment to any
Multiemployer Plan which such Borrower or any ERISA Affiliate may be
required to make under any agreement relating to such Multiemployer
Plan, or any law pertaining thereto;
(d) fail, or permit any ERISA Affiliate to fail, to pay any
required installment or any other payment required under Section 412
of the Internal Revenue Code on or before the due date for such
installment or other payment;
(e) permit to exist any occurrence of any Reportable Event,
or any other event or condition which in the reasonable opinion of the
Administrative Agent presents a material risk of a material liability
of
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either Borrower or any of its ERISA Affiliates under ERISA or the
Internal Revenue Code; or
(f) enter into any new Plan, or modify any existing Plan
contributed to or maintained by either Borrower or any of its ERISA
Affiliates, so as to materially increase the obligations of such
Borrower or any of its ERISA Affiliates.
10.14. Sale of Receivables and Matters Relating to
Receivables. Neither Borrower shall, nor shall either Borrower permit any of
its Subsidiaries to:
(a) rebate any invoice or sale or make sales on extended
dating beyond that customary in the industry or rebill any Receivable
without promptly disclosing the same to the Administrative Agent and
providing the Administrative Agent with a copy of such rebilling;
(b) directly or indirectly, sell, or discount any of its
Receivables or any of its notes or obligations receivable in any
amount other than, in the case of Domestic Subsidiaries, the sale,
with recourse, of Receivables owing from foreign account debtors not
to exceed $1,000,000 in the aggregate during each Fiscal Year and the
sale, without recourse, of Receivables owing from foreign account
debtors not to exceed $3,000,000 in the aggregate during each Fiscal
Year;
(c) directly or indirectly, sell or discount any of its
Receivables or any of its notes or obligations receivable in any
amount with recourse, except Receivables, notes or obligations
receivable which result in recourse obligations of Foreign
Subsidiaries not to exceed $2,000,000 in an aggregate amount during
each Fiscal Year.
Notwithstanding anything to the contrary in this Article X, any sale of
Collateral which consists of Property described in this Section 10.14 (other
than sales of Collateral described in clause (b) above), either individually or
in the aggregate, having a value based upon its Total Book Value in excess of
$2,000,000 shall require the prior written approval of all of the Lenders.
10.15. Organizational Documents. Neither Borrower shall,
nor shall either Borrower permit any of its Subsidiaries to, amend, modify or
otherwise change any of the terms or provisions in any of their respective
Organizational Documents as in effect on the Closing Date, except (a) with
respect to which written notice shall have been provided to the Administrative
Agent within ten (10) days prior to the effective date of any such amendment,
modification or change and (b) if no Event of Default or Potential Event of
Default would result therefrom.
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10.16. Bank Accounts. Neither Borrower shall, nor shall
either Borrower permit any of its Subsidiaries to establish or maintain any
deposit account into which collections of Receivables and proceeds of other
Collateral are deposited other than those identified as existing on the Closing
Date and disclosed on SCHEDULE 10.16 attached hereto and any such accounts of a
Guarantor in which amounts on deposit shall not exceed $75,000 in the aggregate
at any time, unless such Borrower gives the Administrative Agent prior written
notice of such establishment and delivers to the Administrative Agent an
executed Collection Account Agreement concurrently with such deposit account
being established.
10.17. Fiscal Year. Neither Borrower shall, nor shall
either Borrower permit any of its Subsidiaries to, change its Fiscal Year (a)
for accounting purposes from a period consisting of the 12-month period ending
on March 31 of each calendar year or (b) except as required in order to file
consolidated income tax returns with The ▇▇▇▇▇▇▇▇▇ Corporation, for tax
purposes from a period consisting of the 12-month period ending on March 31 of
each calendar year.
10.18. Issuance and Disposal of Capital Stock. Neither
Borrower shall, nor shall either Borrower permit any of its Subsidiaries to,
directly or indirectly issue, sell, assign, pledge, encumber or dispose of any
shares of its Capital Stock or other equity Securities, except (a) to qualify
directors if required by applicable law, (b) under Permitted Equity Securities
Options, (c) Capital Stock of Banner which is common stock, (d) Preferred
Stock, and (e) as otherwise specifically permitted pursuant to the terms of
this Agreement.
10.19. Consultant Contracts. Neither Borrower shall, nor
shall either Borrower permit any of its Subsidiaries to, become obligated under
consulting or like contracts with Persons who have been employees or directors
of such Person for amounts aggregating more than $1,000,000 in any Fiscal Year.
10.20. Payments on Other Indebtedness. Neither Borrower
shall, nor shall either Borrower permit any of its Subsidiaries to, (a) make
any voluntary prepayment of principal of, or make any redemption, purchase,
retirement, defeasance, sinking fund or similar payment with respect to any
Indebtedness for borrowed money other than the Obligations which is not
required under the terms of such Indebtedness, (b) make any payments of
principal or interest on any amount of Other Indebtedness owing to an Affiliate
of it at any time at which an Event of Default or a Potential Event of Default
exists, or (c) amend, modify or supplement any payment or prepayment terms
contained in any agreement or instrument executed and delivered with respect to
such Indebtedness for borrowed money other than as otherwise specifically
permitted under this Agreement.
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10.21. Aircraft Purchases. Notwithstanding anything to the
contrary contained in Section 10.01, neither Borrower shall, nor shall either
Borrower permit any of its Subsidiaries to, purchase (a) any single Aircraft or
Airframe, the consideration for which exceeds $5,000,000, or (b) any single
Engine or Engine core, the consideration for which exceeds $4,000,000;
provided, however, that (i) the amount set forth in clause (a) above may, at
the sole discretion of the Administrative Agent, be increased by $1,000,000
upon the request of the Borrowers and the written concurrence of the
Administrative Agent and (ii) the amount set forth in clause (b) above may, at
the sole discretion of the Administrative Agent, be increased by $500,000 upon
the request of the Borrowers and the written concurrence of the Administrative
Agent. In any instance when the consideration for any single Aircraft,
Airframe, Engine or Engine core exceeds $500,000, the respective purchaser
thereof must be a party to an Aircraft Mortgage covering such Aircraft,
Airframe, Engine or Engine core purchased.
10.22. Settlement of Receivables. Neither Borrower shall,
nor shall either Borrower permit any of its Subsidiaries to, settle or adjust
disputes and claims with respect to any of its Receivables with respect to
which any discount, credit or allowance is granted to any customer or account
debtor or accept any return of merchandise, in either instance, in excess of
$1,000,000 without the consent of the Administrative Agent, except for
discounts, credits and allowances made or given in the ordinary course of
business and of which written notice is given to the Administrative Agent.
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ARTICLE XI
FINANCIAL COVENANTS
The Borrowers hereby covenant and agree that so long as any
Commitments are outstanding and thereafter until payment in full of all of the
Obligations (other than indemnities not yet due):
11.01. Interest Coverage Ratio. Banner shall maintain an
Interest Coverage Ratio as determined as of the last day of each fiscal quarter
of Banner set forth below for the four- fiscal-quarter period then ending of at
least the ratio set forth below opposite such determination date:
Fiscal Quarter Ending Ratio
--------------------- -----
9/30/95 1.70 to 1.00
12/31/95 1.70 to 1.00
3/31/96 1.70 to 1.00
6/30/96 1.70 to 1.00
9/30/96 1.70 to 1.00
12/31/96 1.70 to 1.00
3/31/97 2.00 to 1.00
6/30/97 2.00 to 1.00
9/30/97 2.20 to 1.00
12/31/97 2.20 to 1.00
3/31/98 2.40 to 1.00
6/30/98 2.40 to 1.00
9/30/98 2.40 to 1.00
12/31/98 2.40 to 1.00
3/31/99 2.75 to 1.00
6/30/99 2.75 to 1.00
9/30/99 2.75 to 1.00
12/31/99 2.75 to 1.00
3/31/00 3.00 to 1.00
and each quarter
thereafter
11.02. Fixed Charge Coverage Ratio. Banner shall maintain a
Fixed Charge Coverage Ratio as determined as of the last day of each fiscal
quarter of Banner for the four-fiscal-quarter period then ending of at least
1.00 to 1.00; provided that calculation of the Fixed Charge Coverage Ratio for
the four-fiscal-quarter periods ending on September 30, 1995, December 31,
1995, March 31, 1996, June 30, 1996, September 30, 1996 and December 31, 1996
shall exclude all Capital Expenditures recorded relating to the Utah
Distribution Center up to an aggregate of
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such Capital Expenditures not to exceed $9,000,000 and provided further that
the amount of principal amortization used in the calculation of the Fixed
Charge Coverage Ratio for the periods ending September 30, 1995, December 31,
1995, March 31, 1996 and June 30, 1996 shall equal $7,000,000.
11.03. Leverage Ratio. Banner shall maintain a Leverage
Ratio as determined as of the last day of each fiscal quarter of Banner set
forth below for the four-fiscal-quarter period then ending of not more than the
ratio set forth below opposite such determination date:
Fiscal Quarter Ending Ratio
--------------------- -----
9/30/95 5.95 to 1.00
12/31/95 5.95 to 1.00
3/31/96 5.95 to 1.00
6/30/96 5.95 to 1.00
9/30/96 5.75 to 1.00
12/31/96 5.50 to 1.00
3/31/97 5.00 to 1.00
6/30/97 5.00 to 1.00
9/30/97 5.00 to 1.00
12/31/97 5.00 to 1.00
3/31/98 4.50 to 1.00
6/30/98 4.50 to 1.00
9/30/98 4.50 to 1.00
12/31/98 4.50 to 1.00
3/31/99 4.00 to 1.00
6/30/99 4.00 to 1.00
9/30/99 4.00 to 1.00
12/31/99 4.00 to 1.00
3/31/00 3.75 to 1.00
and each quarter
thereafter
11.04. Net Worth. Banner shall, at all times during the
respective periods set forth below, maintain a consolidated net worth of no
less than the amount set forth below opposite such respective period:
Period Amount
------ ------
Effective Date - 3/30/97 $130,159,000
3/31/97 - 3/30/98 $132,159,000
3/31/98 - 3/30/99 $135,159,000
3/31/99 - 3/30/00 $139,159,000
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3/31/00 - 3/30/01 $144,159,000
3/31/01 - 3/30/02 $150,159,000
3/31/02 and thereafter $157,159,000
provided, however, that in the event Banner issues Capital Stock (other than
pursuant to Permitted Equity Securities Options), the consolidated net worth
amounts set forth above for the period in which such Capital Stock is issued
and for each period thereafter shall be increased by seventy-five percent (75%)
of the amount by which Banner's consolidated net worth is increased as a result
of the issuance of such Capital Stock as reflected in the Financial Statements
delivered to the Administrative Agent as required by Section 8.01(b) for the
fiscal quarter of Banner (a) immediately succeeding the date on which such
Capital Stock is issued, if such date is not the last day of a fiscal quarter
or (b) ending on the date on which such Capital Stock is issued, if such date
is the last day of a fiscal quarter.
11.05. Capital Expenditures. The Borrowers and their
Subsidiaries shall not make Capital Expenditures during any period set forth
below, in an aggregate amount exceeding the maximum amount set forth below
opposite such period below:
Period Maximum Amount
------ --------------
4/1/95 - 3/31/96 $10,000,000
4/1/96 - 3/31/97 $ 5,500,000
4/1/97 - 3/31/98 $ 2,000,000
and each fiscal year
thereafter
provided, however, to the extent Banner and its Subsidiaries have not made
Capital Expenditures in the amount permitted above for a given period, Capital
Expenditures in an amount equal to that portion of the Maximum Amount of such
Capital Expenditures permitted but not made in such period may be made in the
immediately next succeeding Fiscal Year in addition to any amounts permitted
above for such Fiscal Year; provided that (a) amounts carried forward from one
Fiscal Year to a succeeding Fiscal Year may only be expended or accrued for
Capital Expenditures after the Maximum Amount permissible for such succeeding
Fiscal Year have been expended or accrued and (b) to the extent amounts carried
forward from one Fiscal Year to the next succeeding Fiscal Year are not
expended or accrued in such succeeding Fiscal Year, such surplus may not be
carried forward to any other succeeding year, except for such surplus for the
period April 1, 1996 - March 31, 1997, which may be carried forward to any
succeeding year until expended; and provided, further, that no more than
$1,000,000 of the Maximum Amount for the period set forth above ending on March
31, 1996 may be carried forward to the next succeeding Fiscal Year.
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11.06. Financial Covenant Calculations. Notwithstanding any
requirements under GAAP, calculations made with respect to (a) the definitions
of "EBITDA", "Net Income", "Fixed Charge Coverage Ratio", "Interest Coverage
Ratio", "Leverage Ratio", and "Capital Expenditures" and (b) determination of
compliance with the financial covenants set forth in this Article XI, each
shall be made without regard to the requirements of Accounting Principles Board
Opinion 16 or changes in requirements under GAAP which become effective after
the Closing Date.
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ARTICLE XII
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
12.01. Events of Default. Each of the following occurrences
shall constitute an Event of Default under this Agreement:
(a) Failure to Make Payments When Due. The Borrowers
shall fail to (i) pay any principal on any Loan made to it when due in
accordance with the terms of this Agreement and the Note evidencing the same,
including, without limitation, any mandatory prepayment payable under the terms
of Section 4.01(b) or to pay any Issuing Bank in respect of any Reimbursement
Obligation owing to such Issuing Bank in accordance with Section 3.01(d) or
(ii) pay any interest on any Loan, fees due under the terms of this Agreement
and the 1995 Fee Letter or other Obligations outstanding hereunder within three
(3) Business Days after the same become due in accordance with the terms of
this Agreement or the 1995 Fee Letter.
(b) Breach of Certain Covenants. The Borrowers shall fail
duly and punctually to perform or observe any agreement, covenant or obligation
binding on such Person under Article X or Article XI.
(c) Breach of Representation or Warranty. Any
representation, warranty, Financial Statement or other written schedule or
disclosure made or deemed made by the Borrowers or any officer of either
Borrower to the Administrative Agent, any Lender or any Issuing Bank herein, or
by a Borrower, any Subsidiary of a Borrower, or any officer of either Borrower
or Subsidiary of a Borrower, in any of the other Loan Documents, or in any
statement or certificate at any time given by any such Person pursuant to any
of the Loan Documents shall be false or incorrect in any material respect on
the date as of which made (or deemed made).
(d) Other Defaults. The Borrowers shall default in the
performance of or compliance with any term contained in this Agreement (other
than as identified in clauses (a), (b) or (c) of this Section 12.01) or any
default or event of default shall occur under any of the other Loan Documents,
and such default or event of default shall continue unremedied for thirty (30)
days after the earlier to occur of (i) the date either Borrower obtains
knowledge of such default and (ii) the date written notice of such default has
been given by any Lender or the Administrative Agent to either Borrower;
provided, however, that any default in the Borrowers' compliance with the terms
of Sections 9.05, 9.09, 9.10, 9.13, or 9.16 occurs which is able to be remedied
within sixty (60) days after the earlier to occur of the dates set forth in
clauses (d)(i) or (d)(ii) above, shall not
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become an Event of Default until such sixtieth (60th) day so long as the
Borrowers are diligently pursuing the remedy thereof.
(e) Default as to Other Indebtedness. Either Borrower or any
Subsidiary of either Borrower shall fail to make any payment when due (whether
by scheduled maturity, required prepayment, acceleration, demand or otherwise
after giving effect to any applicable grace period) with respect to any
Indebtedness (other than an Obligation or Intercompany Debt) of the Borrower
and its Subsidiaries aggregating $1,000,000 or more; or any breach, default or
event of default shall occur, or any other condition shall exist under any
instrument, agreement or indenture pertaining to any such Indebtedness, if the
effect thereof (with or without the giving of notice or lapse of time or both)
is to cause an acceleration, mandatory redemption or other required repurchase
of such Indebtedness, or permit the holder(s) of such Indebtedness to
accelerate the maturity of any such Indebtedness or require a redemption or
other repurchase of such Indebtedness; or any such Indebtedness shall be
otherwise declared to be due and payable (by acceleration or otherwise) or
required to be prepaid, redeemed or otherwise repurchased by a Borrower or any
of its Subsidiaries (other than by a regularly scheduled required prepayment)
prior to the stated maturity thereof.
(f) Involuntary Bankruptcy; Appointment of Receiver, Etc. (i)
An involuntary case shall be commenced against either Borrower or any
Subsidiary of either Borrower and the petition shall not be (A) controverted
within ten (10) days after commencement of the case and (B) dismissed within
sixty (60) days after commencement of the case; or a court having jurisdiction
in the premises shall enter a decree or order for relief in respect of such
Borrower or such Subsidiary in an involuntary case, under any applicable
bankruptcy, insolvency or other similar law now or hereinafter in effect; or
any other similar relief shall be granted under any applicable federal, state,
local or foreign law.
(ii) A decree or order of a court having jurisdiction in the
premises for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over either Borrower or any
Subsidiary of either Borrower or over all or a substantial part of the Property
of either Borrower or any Subsidiary of either Borrower shall be entered; or an
interim receiver, trustee or other custodian of either Borrower or any
Subsidiary of either Borrower or of all or a substantial part of the Property
of either Borrower or any Subsidiary of either Borrower shall be appointed; or
a warrant of attachment, execution or similar process against any substantial
part of the Property of either Borrower or any Subsidiary of either Borrower
shall be issued; and any such event shall not be
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stayed, dismissed, bonded or discharged within thirty (30) days after entry,
appointment or issuance.
(g) Voluntary Bankruptcy; Appointment of Receiver, Etc.
Either Borrower or any Subsidiary of either Borrower shall have an order for
relief entered with respect to it or commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case, or to the conversion of an involuntary case to a voluntary case, under
any such law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of its
Property; or either Borrower or any Subsidiary of either Borrower shall make
any assignment for the benefit of creditors or shall be unable or fail, or
admit in writing its inability, to pay its debts as such debts become due; or
the board of directors of either Borrower or any Subsidiary of either Borrower
(or any committee thereof) adopts any resolution or otherwise authorizes any
action to approve any of the fore going.
(h) Dissolution. Any order, judgment or decree shall be
entered against either Borrower or any Subsidiary of either Borrower decreeing
its involuntary dissolution or split up and such order shall remain
undischarged and unstayed for a period in excess of sixty (60) days; or either
Borrower or any Subsidiary of either Borrower shall otherwise dissolve, be
dissolved, or cease to exist except as specifically permitted by this
Agreement.
(i) Loan Documents; Failure of Security. At any time,
for any reason, (i) any Loan Document ceases to be in full force and effect
(other than in accordance with the terms hereof or thereof) or the Borrower or
Subsidiary party thereto seeks to repudiate its obligations thereunder and the
Liens intended to be created thereby are, or either Borrower or any such
Subsidiary seeks to render such Liens, invalid, or (ii) Liens on Collateral
(other than Capital Stock pledged to the Administrative Agent pursuant to the
Loan Documents) in favor of the Administrative Agent for the benefit of the
Holders contemplated by the Loan Documents having an aggregate Fair Market
Value in excess of $100,000 shall, at any time, for any reason, be unperfected
and an intervening Lien has been imposed on such Collateral; or Liens in favor
of the Administrative Agent on such Collateral shall, at any time, for any
reason, be unperfected and remain so for at least three (3) Business Days after
either Borrower is notified thereof by the Administrative Agent or any Lender
or either Borrower acknowledges the foregoing, but no intervening Lien has been
imposed on such Collateral, or (iii) any Lien in favor of the Administrative
Agent for the benefit of the Holders contemplated by the Loan Documents is
determined to be invalid, void or unenforceable for any reason, or (iv) any
Lien on
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Collateral consisting of Capital Stock in favor of the Administrative Agent for
the benefit of the Holders contemplated by the Loan Documents becomes
unperfected or is determined to be invalid, void or unenforceable (other than
by the release of such Collateral pursuant to this Agreement or any of the
other Loan Documents); or (v) any Lien in favor of the Administrative Agent for
the benefit of the Holders contemplated by the Loan Documents shall be
subordinated or shall not have the priority contemplated by this Agreement or
the Loan Documents. Notwithstanding the foregoing, no Event of Default shall be
deemed to have occurred if any failure of perfection or continuation of such
failure shall be solely attributable to acts or omissions of the Administrative
Agent, any Issuing Bank, or any Lender.
(j) Judgments and Attachments; Other Liens. (i) Any
money judgment (other than a money judgment covered by insurance as to which
the insurance company has acknowledged liability with respect to such money
judgement), writ or warrant of attachment, or similar process against either
Borrower or any Subsidiary of either Borrower or any of their respective assets
involving in any case an amount in excess of $1,000,000 is entered and shall
remain undischarged, unvacated, unbonded or unstayed for a period of thirty
(30) days or in any event later than five (5) days prior to the date of any
proposed sale thereunder.
(ii) A federal tax Lien is filed against either Borrower or
any of its Property or any Subsidiary of either Borrower or any of its Property
which is not discharged of record, bonded over or otherwise secured to the
satisfaction of the Administrative Agent within forty-five (45) days after the
filing thereof or the date upon which the Administrative Agent receives actual
knowledge of the filing thereof for an amount which, either separately or when
aggregated with the amount of any judgments described in clause (i) above
and/or the amount of any Environmental Lien Claims described in clause (iii)
below, equals or exceeds $1,000,000.
(iii) An Environmental Lien is filed against any Property of
either Borrower or its Subsidiaries with respect to Claims in an amount which,
when aggregated with the amount of judgments set forth in clause (i) above
and/or the federal tax Lien Claims described in clause (ii) above, equals or
exceeds $1,000,000.
(k) Environmental Matters. Either Borrower or any Subsidiary
of either Borrower shall have become subject to any Liabilities and Costs
arising out of or related to (i) the Release or threatened Release at any
location of any Contaminant into the environment or any Remedial Action in
response thereto or (ii) any violation of any Environmental, Health and Safety
Requirements of Law, which Liabilities and Costs, either singly
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or in the aggregate, would result in a Material Adverse Effect on the Borrowers
and their Subsidiaries taken as a whole.
(l) Unfunded ERISA Liabilities. Any Benefit Plan currently
maintained or contributed to by either Borrower or any ERISA Affiliate, or with
respect to which either Borrower or any ERISA Affiliate has or may have any
liability, shall be terminated in a distress termination within the meaning of
Title IV of ERISA or a trustee shall be appointed by an appropriate United
States District Court to administer any Benefit Plan of such Borrower or ERISA
Affiliate or the PBGC shall institute proceedings to terminate any such Benefit
Plan or to appoint a trustee to administer any such Benefit Plan, if, as of the
date of such termination, appointment or institution of proceedings, the
liability (after giving effect to the tax consequences thereof) of such
Borrower or ERISA Affiliate to the PBGC for the amount of unfunded benefit
liabilities (as defined in Section 4001(a)(18) of ERISA) under the Benefit Plan
exceeds (i) $250,000 in the case of a Benefit Plan maintained or contributed to
by either Borrower or a Subsidiary of either Borrower or (ii) $2,500,000 in the
case of a Benefit Plan of any other ERISA Affiliate (or in the case of a
distress termination of a Benefit Plan involving a substantial employer (as
defined in Section 4001(a)(2) of ERISA) such Borrower's or such ERISA
Affiliate's proportionate share of such excess shall exceed (i) $250,000 in the
case of either Borrower or a Subsidiary of either Borrower or (ii) $2,500,000
in the case of any other ERISA Affiliate) or if the aggregate of all such
liabilities for all such Benefit Plans exceeds (i) $1,000,000 in the case of
all such Benefit Plans of either Borrower or a Subsidiary of either Borrower or
(ii) $2,500,000 in the case of all other ERISA Affiliates.
(m) Withdrawal Liability under Multiemployer Plans. Either
Borrower or any of its ERISA Affiliates as an employer under a Multiemployer
Plan shall have made a complete or partial withdrawal from any such
Multiemployer Plan and such Multiemployer Plan thereafter shall notify such
Borrower or any ERISA Affiliate that it has incurred a withdrawal liability in
an amount exceeding (i) $250,000 in the case of either Borrower or a Subsidiary
of either Borrower or (ii) $2,500,000 in the case of any other ERISA Affiliate,
and the installment payments of such liability shall not be paid when required
to be paid in accordance with applicable law or the provisions of such
Multiemployer Plan, or within five (5) Business Days thereafter.
(n) Change in Control. A Change of Control shall occur.
(o) Material Adverse Effect. An event shall occur which,
either individually or in combination with one or more other events, results in
a Material Adverse Effect (other than with respect to the inability of the
Lenders, the Issuing Banks,
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the Administrative Agent or any Co-Agent to enforce any of the Loan Documents
solely due to an act or omission of any such Person).
An Event of Default shall be deemed "continuing" until cured
or waived in writing in accordance with Section 15.07.
12.02. Rights and Remedies.
(a) Acceleration and Termination. Upon the occurrence of
any Event of Default described in Sections 12.01(f) or 12.01(g), the Lenders'
respective obligations to make Revolving Loans under the Revolving Credit
Commitments shall automatically and immediately terminate and the unpaid
principal amount of, and any and all accrued interest on, the Obligations and
all accrued fees shall automatically become immediately due and payable,
without presentment, demand, or protest or other requirements of any kind
(including, without limitation, valuation and appraisement, diligence,
presentment, notice of intent to demand or accelerate and of acceleration), all
of which are hereby expressly waived by each Borrower; and upon the occurrence
and during the continuance of any other Event of Default, the Administrative
Agent shall at the request, or may with the consent, of the Requisite Lenders,
by written notice to the Borrowers, (i) declare that the Lenders' respective
obligations to make Revolving Loans under the Revolving Credit Commitments are
terminated, whereupon such obligation of each Lender to make any Revolving Loan
hereunder and of each Lender or Issuing Bank to issue or participate in any
Letter of Credit not then issued shall immediately terminate, and/or (ii)
declare the unpaid principal amount of and any and all accrued and unpaid
interest on the Obligations to be, and the same shall thereupon be, immediately
due and payable, without presentment, demand, or protest or other requirements
of any kind (including, without limitation, valuation and appraisement,
diligence, presentment, notice of intent to demand or accelerate and of
acceleration), all of which are hereby expressly waived by each Borrower.
(b) Deposit for Letters of Credit. In addition, after the
occurrence and during the continuance of an Event of Default, the Borrowers
shall, promptly upon demand by the Administrative Agent, deliver to the
Administrative Agent Cash Collateral in such form as requested by the
Administrative Agent for deposit in the Cash Collateral Account, together with
such endorsements and execution and delivery of such documents and instruments
as the Administrative Agent may request in order to perfect or protect the
Administrative Agent's Lien with respect thereto, in an aggregate principal
amount equal to the then outstanding Letter of Credit Obligations with respect
to issued Letters of Credit.
(c) Rescission. If at any time after termination of the
Lenders' obligations to make Revolving Loans under the
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Revolving Credit Commitments and/or acceleration of the maturity of the Loans,
the Borrowers shall pay all arrears of interest and all payments on account of
principal of the Loans and Reimbursement Obligations which shall have become
due otherwise than by acceleration (with interest on principal and, to the
extent permitted by law, on overdue interest, at the rates specified in this
Agreement) and all Events of Default and Potential Events of Default (other
than nonpayment of principal of and accrued interest on the Loans due and
payable solely by virtue of acceleration) shall be remedied or waived pursuant
to Section 15.07, then upon the written consent of the Requisite Lenders and
written notice to the Borrowers, the termination of Lenders' respective
obligations to make Revolving Loans under the Revolving Credit Commitments and
the respective Lenders' and the Issuing Banks' obligations to participate in or
issue Letters of Credit and/or the aforesaid acceleration and its consequences
may be rescinded and annulled; but such action shall not affect any subsequent
Event of Default or Potential Event of Default or impair any right or remedy
consequent thereon. The provisions of the preceding sentence are intended
merely to bind the Lenders and the Issuing Banks to a decision which may be
made at the election of the Requisite Lenders; they are not intended to benefit
the Borrowers and do not give either Borrower the right to require the Lenders
to rescind or annul any termination of the aforesaid obligations of the Lenders
or Issuing Banks or any acceleration hereunder, even if the conditions set
forth herein are met.
(d) Enforcement. The Borrowers each acknowledge that in the
event either Borrower or any of their Subsidiaries fails to perform, observe or
discharge any of their respective obligations or liabilities under this
Agreement or any other Loan Document, any remedy of law may prove to be
inadequate relief to the Administrative Agent, the Co-Agents, the Issuing Banks
and the Lenders; therefore, the Borrowers each agree that the Administrative
Agent, the Issuing Banks and the Lenders shall be entitled to temporary and
permanent injunctive relief in any such case without the necessity of proving
actual damages.
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ARTICLE XIII
THE ADMINISTRATIVE AGENT AND CO-AGENTS
13.01. Appointment. (a) Each Lender and Issuing Bank hereby
designates and appoints Citicorp as the Administrative Agent of such Lender or
such Issuing Bank under this Agreement and each of NationsBank and LTCB as a
Co-Agent, and each Lender and Issuing Bank hereby irrevocably authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and the Loan Documents and to exercise such powers as are set
forth herein or therein together with such other powers as are reasonably
incidental thereto, including, without limitation, powers as trustee under an
Aircraft Mortgage. The Administrative Agent agrees to act as such on the
express conditions contained in this Article XIII.
(b) The provisions of this Article XIII are solely for the
benefit of the Administrative Agent, the Co-Agents, the Lenders and Issuing
Banks, and neither Borrower nor any Subsidiary of either Borrower shall have
any rights to rely on or enforce any of the provisions hereof (other than as
expressly set forth in Section 13.07). In performing its functions and duties
under this Agreement, the Administrative Agent shall act solely as agent of the
Lenders and the Issuing Banks and does not assume and shall not be deemed to
have assumed any obligation or relationship of agency, trustee or fiduciary
with or for either Borrower or any Affiliate of either Borrower. The
Administrative Agent may perform any of its duties hereunder, or under the
other Loan Documents, by or through its agents or employees.
13.02. Nature of Duties. Neither the Administrative Agent
nor any Co-Agent shall have any duties or responsibilities except those
expressly set forth in this Agreement or in the Loan Documents. The duties of
the Administrative Agent shall be mechanical and administrative in nature.
Neither the Administrative Agent nor any Co-Agent shall have by reason of this
Agreement a fiduciary relationship in respect of any Holder. Nothing in this
Agreement or any of the Loan Documents, expressed or implied, is intended to or
shall be construed to impose upon the Administrative Agent or any Co-Agent any
obligations in respect of this Agreement or any of the other Loan Documents
except as expressly set forth herein or therein. Each Lender and Issuing Bank
shall make its own independent investigation of the financial condition and
affairs of the Borrowers and their Affiliates in connection with the making and
the continuance of the Loans hereunder and with the issuance of the Letters of
Credit and shall make its own appraisal of the creditworthiness of the
Borrowers and Guarantors initially and on a continuing basis, and neither the
Administrative Agent nor any Co-Agent shall have any duty or responsibility,
either initially or on a continuing basis, to provide any Holder with any
credit or other information with respect thereto (except for reports required
to
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be delivered by the Administrative Agent under the terms of this Agreement).
If the Administrative Agent seeks the consent or approval of the Lenders to the
taking or refraining from taking of any action hereunder, the Administrative
Agent shall send notice thereof to each Lender. The Administrative Agent shall
promptly notify each Lender at any time that the Lenders so required hereunder
have instructed the Administrative Agent to act or refrain from acting pursuant
hereto. As to any matters not expressly provided for by this Agreement
(including, without limitation, enforcement or collection of the Notes or any
amount payable under any provision of Article IV when due) or the other Loan
Documents, neither the Administrative Agent nor any Co-Agent shall be required
to exercise any discretion or take any action. Notwithstanding the foregoing,
the Administrative Agent shall be required to act or refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Requisite Lenders (unless the instructions or consent of
all of the Lenders is required hereunder or thereunder) and such instructions
shall be binding upon all Lenders, all Issuing Banks and all Holders of Notes;
provided, however, the Administrative Agent shall not be required to take any
action which (i) the Administrative Agent reasonably believes will expose it to
personal liability unless the Administrative Agent receives an indemnification
satisfactory to it from the Lenders with respect to such action or (ii) is
contrary to this Agreement, the other Loan Documents or applicable law. The Co-
Agents shall have only such duties as the Administrative Agent and the
Co-Agents may agree upon from time to time.
13.03. Rights, Exculpation, Etc. (a) Liabilities;
Responsibilities. Neither the Administrative Agent or any Co-Agent nor any
Affiliate of the Administrative Agent or any Co- Agent or any of their
respective officers, directors, employees or agents shall be liable to any
Holder for any action taken or omitted by them hereunder or under any of the
Loan Documents, or in connection therewith, except that no Person shall be
relieved of any liability imposed by law for gross negligence or willful
misconduct. The Administrative Agent shall not be liable for any apportionment
or distribution of payments made by it in good faith pursuant to Section
4.02(b), and if any such apportionment or distribution is subsequently
determined to have been made in error the sole recourse of any Holder to whom
payment was due, but not made, shall be to recover from other Holders any
payment in excess of the amount to which they are determined to have been
entitled. Neither the Administrative Agent nor any Co-Agent shall be
responsible to any Holder for any recitals, statements, representations or
warranties herein or for the execution, effectiveness, genuineness, validity,
legality, enforceability, collectibility, or sufficiency of this Agreement or
any of the other Loan Documents or the transactions contemplated thereby, or
for the financial condition of either Borrower or any of their Affiliates or
any Guarantor. Neither the Administrative Agent
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nor any Co-Agent shall be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Agreement or any of the other Loan Documents, or the financial condition of the
Borrowers or any of their Affiliates or any Guarantor, or the existence or
possible existence of any Potential Event of Default or Event of Default.
(b) Right to Request Instructions. The Administrative Agent
may at any time request instructions from the Lenders with respect to any
actions or approvals which by the terms of any of the Loan Documents the
Administrative Agent is permitted or required to take or to grant, and the
Administrative Agent shall be absolutely entitled to refrain from taking any
action or to withhold any approval and shall not be under any liability
whatsoever to any Person for refraining from any action or with holding any
approval under any of the Loan Documents until it shall have received such
instructions from those Lenders from whom the Administrative Agent is required
to obtain such instructions for the pertinent matter in accordance with the
Loan Documents. Without limiting the generality of the foregoing, no Holder
shall have any right of action whatsoever against the Administrative Agent or
any Co-Agent as a result of their acting or refraining from acting under the
Loan Documents in accordance with the instructions of the Requisite Lenders or,
where required by the express terms of this Agreement, a greater proportion of
the Lenders.
13.04. Reliance. The Administrative Agent shall be entitled
to rely upon any written notices, statements, certificates, orders or other
documents or any telephone message believed by it in good faith to be genuine
and correct and to have been signed, sent or made by the proper Person, and
with respect to all matters pertaining to this Agreement or any of the Loan
Documents and its duties hereunder or thereunder, upon advice of legal counsel
(including counsel for the Borrowers), independent public accountants and other
experts selected by it.
13.05. Indemnification. To the extent that the
Administrative Agent or either Co-Agent, in such capacity, is required to be
reimbursed and indemnified by the Borrowers but is not reimbursed and
indemnified by the Borrowers, the Lenders will reimburse and indemnify the
Administrative Agent and Co-Agents for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against it in any way relating to or arising out
of the Loan Documents or any action taken or omitted by the Administrative
Agent or Co-Agents under the Loan Documents, in proportion to each Lender's Pro
Rata Share. The obligations of the Lenders under this Section 13.05 shall
survive the payment in full of the Loans, the Reimbursement
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Obligations and all other Obligations and the termination of this Agreement.
13.06. Citicorp Individually. With respect to its Pro Rata
Share of the Commitments hereunder, if any, and the Loans made by it, if any,
Citicorp shall have and may exercise the same rights and powers hereunder and
is subject to the same obligations and liabilities as and to the extent set
forth herein for any other Lender. The terms "Lenders" or "Requisite Lenders"
or any similar terms shall, unless the context clearly otherwise indicates,
include Citicorp in its individual capacity as a Lender or one of the Requisite
Lenders. Citicorp and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of banking, trust or other business with the
Borrowers or any of its Affiliates as if it were not acting as the
Administrative Agent pursuant hereto.
13.07. Successor Agents. (a) Resignation. The
Administrative Agent and any Co-Agent may resign from the performance of all
its functions and duties hereunder at any time by giving at least thirty (30)
Business Days' prior written notice to the Borrowers and the Lenders. Such
resignation shall take effect (i) with respect to a Co-Agent, on the thirtieth
(30th) Business Day after the date of such notice and (ii) with respect to the
Administrative Agent, upon the acceptance by a successor Administrative Agent
of appointment pursuant to this Section 13.07.
(b) Appointment by Requisite Lenders. Upon any such
notice of resignation, the Requisite Lenders shall have the right to appoint a
successor Co-Agent or Administrative Agent selected from among the Lenders
which appointment shall be subject to the prior written approval of the
Borrowers (which may not be unreasonably withheld, and shall not be required
upon the occurrence and during the continuance of an Event of Default).
(c) Appointment by Retiring Administrative Agent. If a
successor Administrative Agent shall not have been appointed within the thirty
(30) Business Day period provided in clause (a) of this Section 13.07, the
retiring Administrative Agent, with the consent of the Borrowers (which may not
be unreasonably withheld, and shall not be required upon the occurrence and
during the continuance of an Event of Default), shall then appoint a successor
Administrative Agent who shall serve as Administrative Agent until such time,
if any, as the Requisite Lenders appoint a successor Administrative Agent as
provided above. There shall be no requirement that successor Co-Agents be
appointed upon the resignation of an existing Co-Agent and such appointment
shall be discretionary with the Requisite Lenders, subject to the provisions of
Section 13.07(b).
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(d) Rights of the Successor and Retiring Agents. Upon the
acceptance of any appointment as the Administrative Agent or a Co-Agent
hereunder by a successor Administrative Agent or successor Co-Agent, as
applicable, such successor Administrative Agent or Co-Agent, as applicable,
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent or Co-Agent, and the
retiring Administrative Agent or Co-Agent shall be discharged from its duties
and obligations under this Agreement. After any retiring Administrative
Agent's or Co-Agent's resignation hereunder as Administrative Agent or
Co-Agent, the provisions of this Article XIII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was the Administrative
Agent or a Co-Agent under this Agreement.
13.08. Relations Among Lenders. Each Lender and Issuing
Bank agrees (except as provided in Section 15.05) that it will not take any
legal action, nor institute any actions or proceedings, against the Borrowers
or any other obligor hereunder or with respect to any Collateral, without the
prior written consent of the Requisite Lenders. Without limiting the
generality of the foregoing, no Lender may accelerate or otherwise enforce its
portion of the Obligations, or unilaterally terminate its Commitments except in
accordance with Section 12.02(a).
13.09. Concerning the Collateral and the Loan Documents.
(a) Protective Advances. The Administrative Agent may from time to time,
before or after the occurrence of an Event of Default, make such disbursements
and advances pursuant to the Loan Documents which the Administrative Agent, in
its sole discretion, deems necessary or desirable to preserve or protect the
Collateral or any portion thereof or to enhance the likelihood or maximize the
amount of repayment of the Loans and other Obligations ("Protective Advances");
provided, however, that the amount of any given Protective Advance made at any
time shall not exceed the Revolving Credit Availability at such time and
further provided that the aggregate amount of Protective Advances at any time
outstanding shall not exceed $750,000. The Administrative Agent shall notify
the Borrowers and each Revolving Lender in writing of each such Protective
Advance, which notice shall include a description of the purpose of such
Protective Advance. The Borrowers agree jointly and severally to pay the
Administrative Agent, upon demand, the principal amount of all outstanding
Protective Advances, together with interest thereon at the rate from time to
time applicable to Base Rate Loans from the date of such Protective Advance
until the outstanding principal balance thereof is paid in full. If the
Borrowers fail to make payment in respect of any Protective Advance within one
(1) Business Day after the date the Borrowers receive written demand therefor
from the Administrative Agent, the Administrative Agent shall promptly notify
each Revolving
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Lender and each Revolving Lender agrees that it shall thereupon make available
to the Administrative Agent, in Dollars in immediately available funds, the
amount equal to such Revolving Lender's Revolving Loan Pro Rata Share of such
Protective Advance. If such funds are not made available to the Administrative
Agent by such Revolving Lender within one (1) Business Day after the
Administrative Agent's demand therefor, the Administrative Agent will be
entitled to recover any such amount from such Revolving Lender together with
interest thereon at the Federal Funds Rate for each day during the period
commencing on the date of such demand and ending on the date such amount is
received. The failure of any Revolving Lender to make available to the
Administrative Agent its Revolving Loan Pro Rata Share of any such Protective
Advance shall neither relieve any other Revolving Lender of its obligation
hereunder to make available to the Administrative Agent such other Revolving
Lender's Revolving Loan Pro Rata Share of such Protective Advance on the date
such payment is to be made nor increase the obligation of any other Revolving
Lender to make such payment to the Administrative Agent. All outstanding
principal of, and interest on, Protective Advances shall constitute Obligations
secured by the Collateral until paid in full by the Borrowers.
(b) Authority. Each Lender and Issuing Bank authorizes and
directs the Administrative Agent to enter into the Loan Documents relating to
the Collateral for the benefit of the Lenders and the Issuing Banks. Each
Lender and Issuing Bank agrees that any action taken by the Administrative
Agent or the Requisite Lenders (or, where required by the express terms of this
Agreement, a greater proportion of the Lenders) in accordance with the
provisions of this Agreement or the other Loan Documents, and the exercise by
the Administrative Agent or the Requisite Lenders (or, where so required, such
greater proportion) of the powers set forth herein or therein, together with
such other powers as are reasonably incidental thereto, shall be authorized and
binding upon all of the Lenders and Issuing Banks. Without limiting the
generality of the foregoing, the Administrative Agent shall have the sole and
exclusive right and authority to (i) act as the disbursing and collecting agent
for the Lenders and the Issuing Banks with respect to all payments and
collections arising in connection with this Agreement and the Loan Documents
relating to the Collateral; (ii) execute and deliver each Loan Document
relating to the Collateral and accept delivery of each such agreement delivered
by a Borrower, any of its Subsidiaries, or any Guarantor a party thereto; (iii)
act as collateral agent for the Lenders and the Issuing Banks for purposes of
the perfection of all security interests and Liens created by such agreements
and all other purposes stated therein; provided, however, the Administrative
Agent hereby appoints, authorizes and directs the Lenders and the Issuing Banks
to act as collateral sub-agent for the Administrative Agent, the Lenders and
the Issuing Banks for
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purposes of the perfection of all security interests and Liens with respect to
the Property at any time in the possession of such Lender or Issuing Bank,
including, without limitation, deposit accounts maintained with, and cash and
Cash Equivalents held by, such Lender or Issuing Bank; (iv) manage, supervise
and otherwise deal with the Collateral; (v) take such action as is necessary or
desirable to maintain the perfection and priority of the security interests and
Liens created or purported to be created by the Loan Documents; and (vi) except
as may be otherwise specifically restricted by the terms of this Agreement or
any other Loan Document, exercise all remedies given to the Administrative
Agent, the Lenders or the Issuing Banks with respect to the Collateral under
the Loan Documents relating thereto, applicable law or otherwise.
(c) Release of Collateral. (i) Each Lender and Issuing
Bank hereby directs, in accordance with the terms of this Agreement, the
Administrative Agent to release any Lien held by the Administrative Agent for
the benefit of the Holders:
(A) against all of the Collateral, upon final and
indefeasible payment in full of the Obligations and termination of
this Agreement;
(B) against any part of the Collateral sold or disposed
of by a Borrower or any Subsidiary of a Borrower, if such sale or
disposition is permitted by Section 10.02 or Section 10.11 or is
otherwise consented to by the Requisite Lenders, as certified to the
Administrative Agent by Banner in an Officer's Certificate; and/or
(C) against any part of the Collateral consisting of a
promissory note, upon final and indefeasible payment in full of the
Indebtedness evidenced thereby.
(ii) Each Lender and Issuing Bank hereby directs the
Administrative Agent to execute and deliver or file such termination and
partial release statements and do such other things as are necessary to release
Liens to be released pursuant to this Section 13.09(c) promptly upon the
effectiveness of any such release.
(d) Subordination of Liens. Each Lender and Issuing Bank
hereby authorizes and directs the Administrative Agent to subordinate the Liens
granted to the Administrative Agent for the benefit of the Holders against (i)
the interest of Dallas Aerospace in Engines complete as equipped which are the
subject of Permitted Engine Leases to the Liens permitted under Section
10.03(f) and the rights of Dallas Aerospace, Inc. under subleases of Engines
which are the subject of the Permitted Engine Leases to the Liens permitted
under Section 10.03(i) and (ii) the Airbus
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Inventory to the purchase money Liens with respect thereto permitted under
Section 10.03(d), in each case, on terms and conditions satisfactory to the
Administrative Agent.
13.10. Exoneration. The Administrative Agent shall have no
obligation whatsoever to any Holder to assure that any of the Collateral exists
or is owned by the Person purporting to ▇▇▇▇▇ ▇ ▇▇▇▇ thereon to secure any of
the Obligations, or is cared for, protected or insured or has been encumbered
or that the Liens granted to the Administrative Agent pursuant to the Loan
Documents have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to
exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to the Administrative Agent in the
Loan Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission or event related thereto, the Administrative
Agent may act in any manner it may deem appropriate, in its sole discretion,
given the Administrative Agent's own interest in the Collateral as one of the
Lenders and that the Administrative Agent shall have no duty or liability
whatsoever to any Holder.
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ARTICLE XIV
YIELD PROTECTION
14.01. Taxes. (a) Payment of Taxes. Any and all payments
by the Borrowers, or either of them, hereunder or under any Note or other
document evidencing any Obligations shall be made, in accordance with Section
4.02, free and clear of and without reduction for any and all present or future
taxes, levies, imposts, deductions, charges, withholdings, and all stamp or
documentary taxes, excise taxes, ad valorem taxes and other taxes imposed on
the value of the Property, charges or levies which arise from the execution,
delivery or registration, or from payment or performance under, or otherwise
with respect to, any of the Loan Documents or the Commitments and all other
liabilities with respect thereto excluding, in the case of each Lender, each
Issuing Bank, the Co-Agents and the Administrative Agent, (i) taxes imposed on
or measured by net income or overall gross receipts and capital and franchise
taxes, (ii) any tax required to be withheld by reason of any failure or
inability of any such Person to (A) furnish a correct taxpayer identification
number in the manner required by applicable Requirements of Law, (B) make a
correct payee certification in the manner required by applicable Requirements
of Law, (C) deliver the applicable forms, certifications and representations
required by Section 14.01(d) hereof (other than Section 14.01(d)(ii)(C)), or
(D) include in such Person's income any amount required to be shown on its
United States federal income tax return, (iii) any tax required to be withheld
by reason of the delivery by such Person of a certification described in
Section 14.01(d)(ii)(C) hereof, (iv) any tax that would not be imposed but for
a connection or former connection between such Person or a Person related to
such Person and the jurisdiction of the Governmental Authority imposing such
tax (including, without limitation, a connection arising from such Person or
such related Person being or having been a citizen or resident of such
jurisdiction, or being or having been organized, present or engaged in a trade
or business in such jurisdiction, or having or having had a permanent
establishment or fixed place of business in such jurisdiction, but excluding a
connection arising solely from such Person or such related Person having
executed, delivered, performed its obligations or received payment under, or
enforced, the Loan Documents), except to the extent such tax were imposed due
to a change in the applicable Requirements of Law (all such non-excluded taxes,
levies, imposts, deductions, charges and withholdings being hereinafter
referred to as "Taxes"). If the Borrowers shall be required by law to
withhold or deduct any Taxes from or in respect of any sum payable hereunder or
under any such Note or document to any Lender, any Issuing Bank or the
Administrative Agent, (x) the sum payable to such Lender, such Issuing Bank, or
the Administrative Agent shall be increased as may be necessary so that after
making all required withholding or deductions (including withholding or
deductions applicable to additional sums payable under this
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Section 14.01) such Lender, such Issuing Bank or the Administrative Agent (as
the case may be) receives an amount equal to the sum it would have received had
no such withholding or deductions been made, (y) the Borrowers shall make such
withholding or deductions, and (z) the Borrowers shall pay the full amount
withheld or deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) Indemnification. The Borrowers jointly and severally
agree to indemnify each Lender, each Issuing Bank, the Co-Agents, and the
Administrative Agent against, and reimburse each on demand for, the full amount
of all Taxes (including, without limitation, any Taxes imposed by any
Governmental Authority on amounts payable under this Section 14.01 and any
additional income or franchise taxes resulting therefrom) incurred or paid by
such Lender, such Issuing Bank, such Co-Agent, or the Administrative Agent (as
the case may be) or any of their respective Affiliates and any liability
(including penalties, interest, and out-of-pocket expenses paid to third
parties) arising therefrom or with respect thereto, whether or not such Taxes
were lawfully payable. A certificate as to any additional amount payable to
any Person under this Section 14.01 submitted by it to the Borrowers shall,
absent manifest error, be final, conclusive and binding upon all parties
hereto. Each Lender and Issuing Bank agrees, within a reasonable time after
receiving a written request from the Borrowers, to provide the Borrowers and
the Administrative Agent with such certificates as are reasonably required, and
take such other actions as are reasonably necessary to claim such exemptions as
such Lender or Issuing Bank may be entitled to claim in respect of all or a
portion of any Taxes which are otherwise required to be paid or deducted or
withheld pursuant to this Section 14.01 in respect of any payments under this
Agreement or under the Notes.
(c) Receipts. Within thirty (30) days after the date of any
payment of Taxes by the Borrowers, they will furnish to the Administrative
Agent, at its address referred to in Section 15.08, the original or a certified
copy of a receipt evidencing payment thereof.
(d) Foreign Bank Certifications. (i) Each Lender that is not
created or organized under the laws of the United States or a political
subdivision thereof shall deliver to the Borrowers and the Administrative Agent
on the Effective Date (unless the same was previously delivered on the Closing
Date) or the date on which such Lender becomes a Lender pursuant to Section
15.01 hereof a true and accurate certificate executed in duplicate by a duly
authorized officer of such Lender to the effect that such Lender is eligible to
receive payments hereunder and under the Notes without deduction or withholding
of United States federal income tax (I) under the provisions of an applicable
tax treaty concluded by the United States (in which case the certificate
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shall be accompanied by two duly completed copies of IRS Form 1001 (or any
successor or substitute form or forms)), (II) under Sections 1442(c)(1) and
1442(a) of the Internal Revenue Code (in which case the certificate shall be
accompanied by two duly completed copies of IRS Form 4224 (or any successor or
substitute form or forms)), or (III) due to such Lender's not being a "bank" as
such term is used in Section 881(c)(3)(A) of the Internal Revenue Code (in
which case, the certificate shall be accompanied by two accurate and complete
original signed copies of IRS Form W-8 (or any successor or substitute form or
forms)).
(ii) Each Lender further agrees to deliver to the Borrowers
and the Administrative Agent from time to time, a true and accurate certificate
executed in duplicate by a duly authorized officer of such Lender before or
promptly upon the occurrence of any event requiring a change in the most recent
certificate previously delivered by it to the Borrowers and the Administrative
Agent pursuant to this Section 14.01(d). Each certificate required to be
delivered pursuant to this Section 14.01(d)(ii) shall certify as to one of the
following:
(A) that such Lender can continue to receive payments
hereunder and under the Notes without deduction or withholding of
United States federal income tax;
(B) that such Lender cannot continue to receive payments
hereunder and under the Notes without deduction or withholding of
United States federal income tax as specified therein but does not
require additional payments pursuant to Section 14.01(a) because it is
entitled to recover the full amount of any such deduction or
withholding from a source other than the Borrowers; or
(C) that such Lender is no longer capable of receiving
payments hereunder and under the Notes without deduction or
withholding of United States federal income tax as specified therein
and that it is not capable of recovering the full amount of the same
from a source other than the Borrowers.
Each Lender agrees to deliver to the Borrowers and the Administrative Agent
further duly completed copies of the above-mentioned IRS forms on or before the
earlier of (x) the date that any such form expires or becomes obsolete or
otherwise is required to be resubmitted as a condition to obtaining an
exemption from withholding from United States federal income tax and (y)
fifteen (15) days after the occurrence of any event requiring a change in the
most recent form previously delivered by such Lender to the Borrowers and
Administrative Agent, unless any change in treaty, law, regulation, or official
interpretation
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thereof which would render such form inapplicable or which would prevent the
Lender from duly completing and delivering such form has occurred prior to the
date on which any such delivery would otherwise be required and the Lender
promptly advises the Borrowers that it is not capable of receiving payments
hereunder and under the Notes without any deduction or withholding of United
States federal income tax.
14.02. Increased Capital. If after the date hereof any
Lender or Issuing Bank determines that (i) the adoption or implementation of or
any change in or in the interpretation or administration of any law or
regulation or any guideline or request from any central bank or other
Governmental Authority or quasi-governmental authority exercising jurisdiction,
power or control over any Lender, any Issuing Bank or banks or financial
institutions generally (whether or not having the force of law), compliance
with which affects or would affect the amount of capital required or expected
to be maintained by such Lender or Issuing Bank or any corporation controlling
such Lender or Issuing Bank and (ii) the amount of such capital is increased by
or based upon (A) the making or maintenance by any Lender of its Loans, any
Lender's participation in or obligation to participate in the Loans, Letters of
Credit or other advances made hereunder or the existence of any Lender's
obligation to make Loans or (B) the issuance or maintenance by such Issuing
Bank of, or the existence of such Issuing Bank's obligation to issue, Letters
of Credit, then, in any such case, upon written demand by such Lender or
Issuing Bank (with a copy of such demand to the Administrative Agent), the
Borrowers shall immediately pay to the Administrative Agent for the account of
such Lender or Issuing Bank, from time to time as specified by such Lender or
Issuing Bank, additional amounts sufficient to compensate such Lender or
Issuing Bank or such corporation therefor. Such demand shall be accompanied by
a statement as to the amount of such compensation, include a brief summary of
the basis for such demand, and an explanation of the calculation of such
amount. Such statement shall be conclusive and binding for all purposes,
absent manifest error.
14.03. Changes; Legal Restrictions. If after the date
hereof any Lender or Issuing Bank determines that the adoption or
implementation of or any change in or in the interpretation or administration
of any law or regulation or any guideline or request from any central bank or
other Governmental Authority or quasi-governmental authority exercising
jurisdiction, power or control over any Lender or Issuing Bank or over banks or
financial institutions generally (whether or not having the force of law),
compliance with which:
(a) does or will subject a Lender or an Issuing Bank (or its
Applicable Lending Office or Eurodollar Affiliate) to charges (other
than taxes) of any kind
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which such Lender or Issuing Bank reasonably determines to be
applicable to the Commitments of the Lenders and/or the Issuing Banks
to make Eurodollar Rate Loans or issue and/or participate in Letters
of Credit or change the basis of taxation of payments to that Lender
or Issuing Bank of principal, fees, interest, or any other amount
payable hereunder with respect to Eurodollar Rate Loans or Letters of
Credit; or
(b) does or will impose, modify, or hold applicable, in the
determination of a Lender or an Issuing Bank, any reserve (other than
reserves taken into account in calculating the Eurodollar Rate),
special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities
(including those pertaining to Letters of Credit) in or for the
account of, advances or loans by, commitments made, or other credit
extended by, or any other acquisition of funds by, a Lender or an
Issuing Bank or any Applicable Lending Office or Eurodollar Affiliate
of that Lender or Issuing Bank;
and the result of any of the foregoing is to increase the cost to that Lender
or Issuing Bank of making, renewing or maintaining the Loans or its Commitments
with respect to, or issuing or participating in, the Letters of Credit or to
reduce any amount receivable thereunder; then, in any such case, upon written
demand by such Lender or Issuing Bank (with a copy of such demand to the
Administrative Agent), the Borrowers shall immediately pay to the
Administrative Agent for the account of such Lender or Issuing Bank, from time
to time as specified by such Lender or Issuing Bank, such amount or amounts as
may be necessary to compensate such Lender or Issuing Bank or its Eurodollar
Affiliate for any such additional cost incurred or reduced amount received.
Such demand shall be accompanied by a statement as to the amount of such
compensation and include a brief summary of the basis for such demand. Such
statement shall be conclusive and binding for all purposes, absent manifest
error.
14.04. Illegality. (i) If at any time any Lender
determines (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties) that the making or continuation of any
Eurodollar Rate Loan has become unlawful or impermissible by compliance by that
Lender with any law, governmental rule, regulation or order of any Governmental
Authority (whether or not having the force of law and whether or not failure to
comply therewith would be unlawful or would result in costs or penalties),
then, and in any such event, such Lender may give notice of that determination,
in writing, to the Borrowers and the Administrative Agent, and the
Administrative Agent shall promptly transmit the notice to each other Lender.
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(ii) When notice is given by a Lender under Section 14.04(i), (A)
the Borrowers' right to request from such Lender and such Lender's obligation,
if any, to make Eurodollar Rate Loans shall be immediately suspended, and such
Lender shall make a Base Rate Loan as part of any requested Borrowing of
Eurodollar Rate Loans and (B) if the affected Eurodollar Rate Loan or Loans are
then outstanding, the Borrowers shall immediately, or if permitted by
applicable law, no later than the date permitted thereby, upon at least one (1)
Business Day's prior written notice to the Administrative Agent and the
affected Lender, convert each such Loan into a Base Rate Loan.
(iii) If at any time after a Lender gives notice under Section
14.04(i) such Lender determines that it may lawfully make Eurodollar Rate
Loans, such Lender shall promptly give notice of that determination, in
writing, to the Borrowers and the Administrative Agent, and the Administrative
Agent shall promptly transmit the notice to each other Lender. The Borrowers'
right to request, and such Lender's obligation, if any, to make Eurodollar
Rate Loans shall thereupon be restored.
14.05. Compensation. In addition to all amounts required to
be paid by the Borrowers pursuant to Section 5.01, the Borrowers shall
compensate each Lender, upon demand, for all losses, expenses and liabilities
(including, without limitation, any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to fund or maintain such Lender's Eurodollar Rate Loans to the Borrowers but
excluding any loss of Applicable Eurodollar Rate Margin on the relevant Loans)
which that Lender may sustain (i) if for any reason a Borrowing, conversion
into or continuation of Eurodollar Rate Loans does not occur on a date
specified therefor in a Notice of Borrowing or a Notice of
Conversion/Continuation given by the Borrowers or in a telephonic request by it
for borrowing or conversion/continuation or a successive Eurodollar Interest
Period does not commence after notice therefor is given pursuant to Section
5.01(c), including, without limitation, pursuant to Section 5.02(e), (ii) if
for any reason any Eurodollar Rate Loan is prepaid or converted (including,
without limitation, mandatorily pursuant to Section 4.01 or Section 14.04(ii))
on a date which is not the last day of the applicable Eurodollar Interest
Period, (iii) as a consequence of a required conversion of a Eurodollar Rate
Loan to a Base Rate Loan as a result of any of the events indicated in Section
5.02(e), or (iv) as a consequence of any failure by the Borrowers to repay
Eurodollar Rate Loans when required by the terms of this Agreement. The
Lender making demand for such compensation shall deliver to the Borrowers
concurrently with such demand a written statement in reasonable detail as to
such losses, expenses and liabilities, and this statement shall be conclusive
as to the amount of compensation due to that Lender, absent manifest error.
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14.06. Limitation on Additional Amounts Payable by the
Borrowers. Notwithstanding the provisions of Section 14.01(a), the Borrowers
shall not be required to pay any additional amounts hereunder to a Lender or an
Issuing Bank if (a) the obligation to pay such additional amounts would not
have arisen but for a failure by such Lender or Issuing Bank to comply with the
requirements described in Section 14.01 or (b) such Lender or Issuing Bank
shall not have furnished the Borrowers with such forms or shall not have taken
such other action as reasonably may be available to it under applicable tax
laws and any applicable tax treaty to obtain an exemption from, or reduction
(to the lowest applicable rate) of withholding of such United States federal
income tax; provided, however, the Borrowers' obligation to pay such additional
amounts shall be reinstated upon receipt of such forms or evidence that action
with respect to obtaining such exemption or reduction has been taken.
14.07. Change in Lending Office. Any Lender claiming any
additional amounts payable pursuant to Section 14.01 shall use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions) to change the Domestic Lending Office designated by it for
purposes of this Agreement to a Domestic Lending Office in another
jurisdiction, if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts which may thereafter accrue
and would not, in the judgment of such Lender, be otherwise disadvantageous to
such Lender.
14.08. Replacement of Lender. If Borrowers become obligated
to pay additional amounts to any Lender described in this Article XIV as a
result of any condition described in Sections 14.01 or 14.02, and payment of
such amount is demanded by such Lender or any certificate is delivered by a
Lender pursuant to Section 14.01 or any Lender delivers a notice pursuant to
Section 14.01, then, unless such Lender has theretofore taken steps to remove
or cure, and has removed or cured, the conditions creating the cause for such
obligation to pay such additional amounts or delivery of such certificate (and
in the case of additional amounts due pursuant to Section 14.01 has delivered a
certificate described in Section 14.01 ) or the delivery of such notice, the
Borrowers, acting jointly, may designate an Eligible Assignee to purchase for
cash (pursuant to an Assignment and Acceptance) the Loans and Letter of Credit
Obligations outstanding to such Lender and such Lender's rights and obligations
hereunder related to such Loans and Letter of Credit Obligations, without
recourse to or warranty by, or expense to, such Lender, for a purchase price
equal to the outstanding principal amount of each such Loan outstanding to such
Lender plus all accrued but unpaid interest thereon, each such Letter of Credit
Obligation outstanding to such Lender (or in which such Lender has funded its
participating interest pursuant to this Agreement) and all accrued but unpaid
Unused
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Commitment Fees and other fees, expense reimbursements and indemnities in
respect of that Lender's Commitments hereunder.
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ARTICLE XV
MISCELLANEOUS
15.01. Assignments and Participations. (a) Assignments. No
assignments or participations of any Lender's rights or obligations under this
Agreement shall be made except in accordance with this Section 15.01. Each
Lender may assign to one or more Eligible Assignees all or a portion of its
rights and obligations under this Agreement (including all of its rights and
obligations with respect to the Term Loans, the Tranche B Term Loans, the
Tranche C Term Loans, the Revolving Loans and the Letters of Credit) in
accordance with the provisions of this Section 15.01.
(b) Limitations on Assignments. Each assignment shall be
subject to the following conditions: (i) each such assignment may be on a
non-pro-rata basis, but shall be of a constant, and not a varying, ratable
percentage of all of the assigning Lender's rights and obligations under this
Agreement which are subject to such assignment and, in the case of a partial
assignment, shall be in a minimum principal amount of $5,000,000, (ii) each
such assignment shall be to an Eligible Assignee, (iii) the Borrowers shall
have the right to approve each such Eligible Assignee which is not an Affiliate
of a Lender, which approval shall not be unreasonably withheld or delayed, (iv)
the Issuing Banks shall have the right to approve each such Eligible Assignee
which (A) is not an Affiliate of a Lender but (B) is an assignee with respect
to Revolving Credit Commitments, which approval shall not be unreasonably
withheld or delayed, and (v) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance and recording in
the Register, an Assignment and Acceptance. Upon such execution, delivery,
acceptance and recording in the Register, from and after the effective date
specified in each Assignment and Acceptance and agreed to by the
Administrative Agent, (A) the assignee thereunder shall, in addition to any
rights and obligations hereunder held by it immediately prior to such effective
date, if any, have the rights and obligations hereunder that have been assigned
to it pursuant to such Assignment and Acceptance and shall, to the fullest
extent permitted by law, have the same rights and benefits hereunder as if it
were an original Lender hereunder, (B) the assigning Lender shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of such assigning Lender's
rights and obligations under this Agreement, the assigning Lender shall cease
to be a party hereto), and (C) concurrently with the return of the Notes being
replaced, the Borrowers shall execute and deliver to the assignor and assignee
thereunder one or more Notes, as
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applicable, evidencing their obligations to such assignor and assignee with
respect to the Loans.
(c) The Register. The Administrative Agent shall maintain
at its address referred to in Section 15.08 a copy of each Assignment and
Acceptance delivered to and accepted by it and a register (the "Register") for
the recordation of the names and addresses of the Lenders and the Commitment
under each Loan of, and principal amount of the Loans under each facility owing
to, each Lender from time to time and whether such Lender is an original Lender
or the assignee of another Lender pursuant to an Assignment and Acceptance. The
entries in the Register shall be conclusive and binding for all purposes,
absent manifest error, and the Borrowers and each of their Subsidiaries, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrowers or
any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(d) Fee. Upon its receipt of an Assignment and
Acceptance executed by the assigning Lender and an Eligible Assignee and a
processing and recordation fee of $3,000 (payable by the assigning Lender or
the assignee, as shall be agreed between them), the Administrative Agent shall,
if such Assignment and Acceptance has been completed and is in compliance with
this Agreement and in substantially the form of EXHIBIT A, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrowers and the other
Lenders.
(e) Participations. Each Lender may sell participations
to one or more other financial institutions in or to all or a portion of its
rights and obligations under and in respect of any and all facilities under
this Agreement (including, with out limitation, all or a portion of any or all
of its Commitments hereunder and the Loans owing to it and its undivided
interest in the Letters of Credit); provided, however, that (i) such Lender's
obligations under this Agreement (including, without limitation, its
Commitments hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) the Borrowers, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement,
(iv) such participant's rights to agree or to restrict such Lender's ability to
agree to the modification, waiver or release of any of the terms of the Loan
Documents or to the release of any Collateral covered by the Loan Documents, to
consent to any action or failure to act by any party to any of the Loan
Documents or any of their respective Affiliates, or to exercise or refrain from
exercising any powers or rights which any Lender
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may have under or in respect of the Loan Documents or any Collateral, shall be
limited to the right to consent to (A) increase in the Commitment of the Lender
from whom such participant purchased a participation, (B) reduction of the
principal of, or rate or amount of interest on the Loans(s) subject to such
participation (other than by the payment or prepayment thereof), (C)
postponement of any date fixed for any payment of principal of, or interest on,
the Loan(s) subject to such participation and (D) release of any guarantor of
the Obligations or all or a substantial portion of the Collateral except as
provided in Section 13.09(c), and (v) any such disposition shall not, without
the consent of the Borrowers, require either Borrower or any Subsidiary of
either Borrower to file a registration statement with the Commission or apply
to qualify the Loans under the blue sky law of any state.
(f) Information Regarding the Borrowers. Any Lender may, in
connection with any assignment or participation or pro posed assignment or
participation pursuant to this Section 15.01, disclose to the assignee or
participant or proposed assignee or participant, any information relating to
the Borrowers or their Subsidiaries furnished to such Lender by the
Administrative Agent or by or on behalf of the Borrowers; provided that, prior
to any such disclosure, such assignee or participant, or proposed assignee or
participant, shall agree to preserve in accordance with Section 15.20 the
confidentiality of any confidential information described therein.
(g) Payment to Participants. Anything in this Agreement
to the contrary notwithstanding, in the case of any participation, all amounts
payable by the Borrowers under the Loan Documents shall be calculated and made
in the manner and to the parties required hereby as if no such participation
had been sold. No holder of a participation in all or any part of the Loans
shall be a Lender for any purpose under this Agreement.
(h) Lenders' Creation of Security Interests. Notwithstanding
any other provision set forth in this Agreement, any Lender may at any time
create a security interest in all or any portion of its rights under this
Agreement (including, without limitation, Obligations owing to it and any Notes
held by it) in favor of any Federal Reserve bank in accordance with Regulation
A of the Federal Reserve Board.
(i) Assignments by Issuing Bank. If a Lender which is also
an Issuing Bank ceases to be a Lender under this Agreement by virtue of any
assignment made pursuant to this Section 15.01, such assignment shall include,
as an assignor party thereto, such Person, as Issuing Bank, and the assignee of
of such Person, as Issuing Bank shall replace the Letters of Credit which are
outstanding as of the effective date of such assignment by Letters of Credit
issued by such successor Issuing Bank. The
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Issuing Banks may terminate their obligations under this Agreement by giving
the Administrative Agent and the Borrowers at least three hundred sixty (360)
days' prior written notice and Borrowers agree that, in the event an Issuing
Bank delivers such notice of termination, Borrowers will use their best efforts
to replace all Letters of Credit issued by such Issuing Bank under this
Agreement.
15.02. Expenses.
(a) Generally. The Borrowers jointly and severally agree
upon demand to pay, or reimburse the Administrative Agent for, all of the
Administrative Agent's reasonable internal and external audit, legal,
appraisal, valuation, filing, document duplication and reproduction and
investigation expenses and for all other out-of-pocket costs and expenses of
every type and nature (including, without limitation, the reasonable fees,
expenses and disbursements of Sidley & Austin, local legal counsel, auditors,
accountants, appraisers, printers, insurance and environmental advisers, and
other consultants and agents) incurred by the Administrative Agent in
connection with (i) the Administrative Agent's review and investigation of the
Borrowers and their Affiliates and the Collateral in connection with the
preparation, negotiation, and execution of the Loan Documents and the
Administrative Agent's periodic reviews and audits of the Borrowers; (ii) the
preparation, negotiation, execution and interpretation of this Agreement
(including, without limitation, the satisfaction or attempted satisfaction of
any of the conditions set forth in Article VI) and the other Loan Documents and
the making of the Loans hereunder; (iii) the creation, perfection or protection
of the Liens under the Loan Documents(including, without limitation, any
reasonable fees and expenses for local counsel in various jurisdictions); (iv)
the ongoing administration of this Agreement, the other Loan Documents and the
Loans, including consultation with attorneys in connection therewith and with
respect to the Administrative Agent's rights and responsibilities under this
Agreement and the other Loan Documents but excluding internal administrative
charges of the Administrative Agent not specifically requested or consented to
by the Borrowers; (v) the protection, collection or enforcement of any of the
Obligations or the enforcement of any of the Loan Documents; (vi) the
commencement, defense or intervention in any court proceeding relating in any
way to the Obligations, the Property, either Borrower, any Subsidiary of either
Borrower, this Agreement or any of the other Loan Documents; (vii) the response
to, and preparation for, any subpoena or request for document production with
which the Administrative Agent is served or deposition or other proceeding in
which the Administrative Agent is called to testify, in each case, relating in
any way to the Obligations, the Property, either Borrower, any Subsidiary of
either Borrower, this Agreement or any of the other Loan Documents; and (viii)
any amendments, consents, waivers,
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assignments, restatements, or supplements to any of the Loan Documents and the
preparation, negotiation, and execution of the same.
(b) After Default. The Borrowers jointly and severally
further agree to pay or reimburse the Administrative Agent, the Co-Agents, the
Issuing Banks and the Lenders upon demand for all out-of-pocket costs and
expenses, including, without limitation, reasonable attorneys' fees (including
allocated costs of internal counsel and costs of settlement) incurred by the
Administrative Agent, any Co-Agents, any Issuing Bank or any Lender after the
occurrence of an Event of Default (i) in enforcing any Loan Document or
Obligation or any security therefor or exercising or enforcing any other right
or remedy available by reason of such Event of Default; (ii) in connection with
any refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or in any insolvency or bankruptcy
proceeding; (iii) in commencing, defending or intervening in any litigation or
in filing a petition, complaint, answer, motion or other pleadings in any legal
proceeding relating to the Obligations, the Property, either Borrower or any
Subsidiary of either Borrower and related to or arising out of the transactions
contemplated hereby or by any of the other Loan Documents; and (iv) in taking
any other action in or with respect to any suit or proceeding (bankruptcy or
otherwise) described in clauses (i) through (iii) above.
15.03. Indemnity. The Borrowers jointly and severally
further agree (a) to defend, protect, indemnify, and hold harmless the
Administrative Agent, the Co-Agents, each and all of the Lenders, and the
Issuing Banks and each of their respective officers, directors, employees,
attorneys, consultants and agents (including, without limitation, those
retained in connection with the satisfaction or attempted satisfaction of any
of the conditions set forth in Article VI) (collectively, the "Indemnitees")
from and against any and all liabilities, obligations, losses (other than loss
of profits), damages, penalties, fees, actions, judgments, suits, claims,
costs, expenses and disbursements of any kind or nature whatsoever (excluding
any taxes and including, without limitation, the reasonable fees and
disbursements of counsel for such Indemnitees in connection with any
investigative, administrative or judicial proceeding, whether or not such
Indemnitees shall be designated a party thereto), imposed on, incurred by, or
asserted against such Indemnitees (whether prior to or from and after the
Closing Date) in any manner relating to or arising out of (i) the negotiation,
preparation, execution or performance of this Agreement, the other Loan
Documents, or any other document executed in connection with the transactions
contemplated by this Agreement, or any act, event or transaction related or
attendant thereto, the making of the Loans and the issuance of and
participation in Letters of Credit hereunder, the management of such Loans or
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Letters of Credit, the use or intended use of the proceeds of the Loans or
Letters of Credit hereunder, or any of the other transactions contemplated by
any of the Loan Documents, or (ii) any Liabilities and Costs relating to any
suit, investigation, action or proceeding by any Person, whether threatened or
initiated, asserting a claim for any legal or equitable remedy against any
Indemnitee under any statute or regulation, including, without limitation, any
federal or state securities or labor laws, or under any common law or equitable
cause or otherwise, arising from or in connection with any violation by either
Borrower, its Subsidiaries, or any Guarantor, or their respective
predecessors-in-interest of any Environmental, Health or Safety Requirements of
Law, the past, present or future operations of either Borrower, its
Subsidiaries, any Guarantor, or any of their respective predecessors in
interest which are subject to Environmental, Health or Safety Requirements of
Law, or, the past, present or future environmental, health or safety condition
of any respective past, present or future Property of either Borrower, any
Subsidiary of either Borrower, or any Guarantor, the presence of
asbestos-containing materials at any respective past, present or future
Property of either Borrower, any Subsidiary of either Borrower, or any
Guarantor, or the Release or threatened Release of any Contaminant into the
environment by either Borrower, its Subsidiaries, any Guarantor, or their
respective predecessors-in-interest, or the Release or threatened Release of
any Contaminant into the environment from or at any facility to which either
Borrower, any Subsidiary of either Borrower, or any Guarantor, or their
respective predecessors-in-interest sent or directly arranged the transport of
any Contaminant (collectively, the "Indemnified Matters"); provided, however,
the Borrowers shall have no obligation to an Indemnitee hereunder with respect
to Indemnified Matters caused by or resulting from the willful misconduct or
gross negligence of such Indemnitee, as determined by a court of competent
jurisdiction and (b) not to assert any claim against any of the Indemnified
Parties on any theory of liability for special, indirect, consequential or
punitive damages arising out of, or in any way in connection with, the
Commitments, the Obligations or any other matters governed by this Agreement
and/or the other Loan Documents. To the extent that the undertaking to
indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, the
Borrowers shall contribute the maximum portion which it is permitted to pay and
satisfy under applicable law, to the payment and satisfaction of all
Indemnified Matters incurred by the Indemnitees. The Indemnitees a party to
this Agreement agree to promptly notify the Borrowers of the commencement of
any legal proceedings which may give rise to any Indemnified Matter, but the
Borrowers agree that the failure to so notify the Borrowers shall not release
the Borrowers from their obligations hereunder except to the extent of any
material increase in the liabilities of the Borrowers under this Section 15.03
directly resulting from
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such failure to receive notice from such Indemnitees; shall permit the
Borrowers to participate in the defense of the Indemnitee in such legal
proceeding; and shall not settle or compromise any Indemnified Matter unless
the Borrowers shall consent to such settlement or compromise.
15.04. Change in Accounting Principles. If any change in
the accounting principles used in the preparation of the most recent Financial
Statements referred to in Section 8.01 are hereafter required or permitted by
the rules, regulations, pronouncements and opinions of the Financial Accounting
Standards Board or the American Institute of Certified Public Accountants (or
successors thereto or agencies with similar functions) and are adopted by the
Borrowers with the agreement of their independent certified public accountants
and such changes result in a change in the method of calculation of any of the
covenants, standards or terms found in Article IX, Article X, and Article XI,
the parties hereto agree to enter into negotiations in order to amend such
provisions so as to equitably reflect such changes with the desired result that
the criteria for evaluating compliance with such covenants, standards and terms
by the Borrowers shall be the same after such changes as if such changes had
not been made; provided, however, no change in GAAP that would affect the
method of calculation of any of such covenants, standards or terms shall be
given effect in such calculations until such provisions are amended, in a
manner satisfactory to the Requisite Lenders and the Borrowers, to so reflect
such change in accounting principles.
15.05. Setoff. In addition to any Liens granted under the
Loan Documents and any rights now or hereafter granted under applicable law,
upon the occurrence and during the continuance of any Event of Default, each
Lender, each Issuing Bank and any Affiliate of any Lender or Issuing Bank is
hereby authorized by the Borrowers at any time or from time to time, without
notice to any Person (any such notice being hereby expressly waived) to set off
and to appropriate and to apply any and all deposits (general or special,
including, but not limited to, indebtedness evidenced by certificates of
deposit, whether matured or unmatured (but not including trust accounts)) and
any other Indebtedness at any time held or owing by such Lender, such Issuing
Bank or any of their Affiliates to or for the credit or the account of the
Borrowers against and on account of the Obligations of the Borrowers to such
Lender, such Issuing Bank or any of their Affiliates, including, but not
limited to, all Loans and Letters of Credit and all claims of any nature or
description arising out of or in connection with this Agreement, irrespective
of whether or not (i) such Lender or such Issuing Bank shall have made any
demand hereunder or (ii) the Administrative Agent, at the request or with the
consent of the Requisite Lenders, shall have declared the principal of and
interest on the Loans and other amounts due hereunder to be due and payable as
permitted by Article XII and
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even though such Obligations may be contingent or unmatured. Each Lender and
Issuing Bank agrees that it shall not, without the express consent of the
Requisite Lenders, and that it shall, to the extent it is lawfully entitled to
do so, upon the request of the Requisite Lenders, exercise its setoff rights
hereunder against any accounts of the Borrowers, any Subsidiary of the
Borrowers, or any Guarantor now or hereafter maintained with such Lender, such
Issuing Bank or any Affiliate of such Lender or Issuing Bank.
15.06. Ratable Sharing. The Lenders agree among themselves
that (i) with respect to all amounts received by them which are applicable to
the payment of the Obligations (excluding the fees described in Section 5.03
and Article XIV), equitable adjustment will be made so that, in effect, all
such amounts will be shared among them ratably in accordance with their Pro
Rata Shares, whether received by voluntary payment, by the exercise of the
right of setoff or banker's lien, by counterclaim or cross-action or by the
enforcement of any or all of the Obligations (excluding the fees described in
Section 5.03 and Article XIV) or the Collateral, (ii) if any of them shall by
voluntary payment or by the exercise of any right of counterclaim, setoff,
banker's lien or otherwise, receive payment of a proportion of the aggregate
amount of the Obligations held by it, which is greater than the amount which
such Lender is entitled to receive hereunder, the Lender receiving such excess
payment shall purchase, without recourse or warranty, an undivided interest and
participation (which it shall be deemed to have done simultaneously upon the
receipt of such payment) in such Obligations owed to the others so that all
such recoveries with respect to such Obligations shall be applied ratably in
accordance with their Pro Rata Shares; provided, however, that if all or part
of such excess payment received by the purchasing party is thereafter recovered
from it, those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such party to the extent necessary to
adjust for such recovery, but without interest except to the extent the
purchasing party is required to pay interest in connection with such recovery.
The Borrowers agree that any Lender so purchasing a participation from another
Lender pursuant to this Section 15.06 may, to the fullest extent permitted by
law, exercise all its rights of payment (including, subject to Section 15.05,
the right of setoff) with respect to such participation as fully as if such
Lender were the direct creditor of the Borrowers in the amount of such
participation.
15.07. Amendments and Waivers. (a) General Provisions.
Unless otherwise provided for or required in this Agreement, no amendment or
modification of any provision of this Agreement or any of the other Loan
Documents shall be effective without the written agreement of the Requisite
Lenders (which the Requisite Lenders shall have the right to grant or withhold
in
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their sole discretion) and the Borrower or Guarantor parties thereto, as
applicable. No termination or waiver of any provision of this Agreement or any
of the other Loan Documents, or consent to any departure by either Borrower
therefrom, shall be effective without the written concurrence of the Requisite
Lenders, which the Requisite Lenders shall have the right to grant or withhold
in their sole discretion. All amendments, modifications, waivers and consents
not specifically reserved to Lenders, the Issuing Banks, and the Administrative
Agent in Section 15.07(b), Section 15.07(c) and in other provisions of this
Agreement shall require only the approval of the Requisite Lenders. Any waiver
or consent shall be effective only in the specific instance and for the
specific purpose for which it was given. No notice to or demand on either
Borrower in any case shall entitle such Borrower to any other or further notice
or demand in similar or other circumstances.
(b) Amendments, Consents and Waivers by Affected Lenders.
Any amendment, modification, termination, waiver or consent with respect to any
of the following provisions of this Agreement shall be effective against a
given Lender or Issuing Bank only if agreed, in writing, by such Lender or
Issuing Bank affected thereby as described below:
(i) waiver of any of the conditions specified in Sections 6.01, 6.02
or 6.03 (except with respect to a condition based upon another
provision of this Agreement, the waiver of which requires only the
concurrence of the Requisite Lenders),
(ii) increase in the amount of any of the Commitments of such Lender
(except with respect to an increase in the amount, or other
modification to the terms or components, of the Borrowing Base
Certificate, each of which shall require only the concurrence of the
Requisite Lenders),
(iii) reduction of the principal of, rate or amount of interest on
the Loans, the Reimbursement Obligations, or any fees or other amounts
payable to such Lender (other than by the payment or prepayment
thereof),
(iv) postponement of the Revolving Credit Termination Date, the Term
Loan Termination Date, the Tranche B Term Loan Termination Date, the
Tranche C Term Loan Termination Date or any date fixed for any payment
of principal of, or interest on, the Loans, the Reimbursement
Obligations or any fees or other amounts payable to such Lender
(except with respect to postponement or other modification of any date
fixed for such payments as are mandatory prepayments described in
Section 4.01(b) which shall require only the concurrence of the
Requisite Lenders), and
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(v) the orders of priority set forth in Section 4.01, in Section
4.02(b)(i), or in clauses (D) through (I) of Section 4.02(b)(ii).
(c) Amendments, Consents and Waivers by All Lenders. Any
amendment, modification, termination, waiver or consent with respect to any of
the following provisions of this Agreement shall be effective only by a written
agreement, signed by each Lender:
(i) release of any Guarantor or all or a substantial portion of the
Collateral other than as provided in Section 13.09(c),
(ii) change in the (A) definition of Requisite Lenders or (B) the
aggregate Pro Rata Share of the Lenders which shall be required for
the Lenders or any of them to take action as Requisite Lenders under
this Agreement or the other Loan Documents,
(iii) amendment of Section 15.01 or this Section 15.07,
(iv) assignment of any right or interest in or under this Agreement
or any of the other Loan Documents by either Borrower,
(v) waiver of any Event of Default described in Sections 12.01(a),
(f), (g), (h), and (o), and
(vi) any amendment (other than as contemplated in Section
15.07(b)(iv)) effecting any change in the Tranche B Term Loan
Termination Date or the Tranche C Term Loan Termination Date.
(d) Amendments, Consents and Waivers by Requisite Revolving
Lenders. Any amendment, modification, termination, waiver or consent with
respect to any change in the definition of Requisite Revolving Lenders or the
aggregate Revolving Loan Pro Rata Share of the Revolving Lenders which shall be
required for the Revolving Lenders or any of them to take action under this
Agreement shall be effective only by a written agreement, signed by the
Requisite Revolving Lenders.
(e) Administrative Agent Authority. The Administrative Agent
may, but shall have no obligation to, with the written concurrence of any
Lender, execute amendments, modifications, waivers or consents on behalf of
that Lender. Notwithstanding anything to the contrary contained in this Section
15.07, no amendment, modification, waiver or consent shall affect the rights or
duties of the Administrative Agent or Co-Agent, as applicable, under this
Agreement or the other Loan Documents, unless made in writing and signed by the
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Administrative Agent or Co-Agent so affected in addition to the Lenders
required above to take such action; and the order of priority set forth in
clauses (A) through (C) of Section 4.02(b)(ii) may be changed only with the
prior written consent of the Administrative Agent. Notwithstanding anything
herein to the contrary, in the event that the Borrowers shall have requested,
in writing, that any Lender agree to an amendment, modification, waiver or
consent with respect to any particular provision or provisions of this
Agreement or the other Loan Documents, and such Lender shall have failed to
state, in writing, that it either agrees or disagrees (in full or in part) with
all such requests (in the case of its statement of agreement, subject to
satisfactory documentation and such other conditions it may specify) within
thirty (30) days after such request, then such Lender shall be deemed to not
have approved such amendment, modification, waiver or consent and the
Administrative Agent shall thereupon determine whether the Lenders required
above to take the requested action have approved the same within the required
time and communicate such determination to the Borrowers and the Lenders.
15.08. Notices. Unless otherwise specifically provided
herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, sent by facsimile
transmission or courier service or United States certified mail and shall be
deemed to have been given when delivered in person or by courier service, upon
receipt of a facsimile transmission, or upon receipt or refusal if deposited in
the United States mail as aforesaid with postage prepaid and properly
addressed. Notices to the Administrative Agent pursuant to Articles II, IV or
XIII shall not be effective until received by the Administrative Agent. For
the purposes hereof, the addresses of the parties hereto (until notice of a
change thereof is delivered as provided in this Section 15.08) shall be as set
forth below each party's name on the signature pages hereof or the signature
page of any applicable Assignment and Acceptance, or, as to each party, at such
other address as may be designated by such party in a written notice to all of
the other parties to this Agreement.
15.09. Survival of Warranties and Agreements. All
representations and warranties made herein and all obligations of the Borrowers
in respect of taxes, indemnification and expense reimbursement shall survive
the execution and delivery of this Agreement and the other Loan Documents, the
making and repayment of the Loans, the issuance and discharge of Letters of
Credit hereunder and the termination of this Agreement and shall not be limited
in any way by the passage of time or occurrence of any event and shall
expressly cover time periods when the Administrative Agent, any Co-Agent, any
Issuing Bank or any of the Lenders may have come into possession or control of
any Property of either Borrower or any Subsidiary of either Borrower.
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15.10. Failure or Indulgence Not Waiver; Remedies
Cumulative. No failure or delay on the part of the Administrative Agent, any
Lender or any Issuing Bank in the exercise of any power, right or privilege
under any of the Loan Documents shall impair such power, right or privilege or
be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege.
All rights and remedies existing under the Loan Documents are cumulative to and
not exclusive of any rights or remedies otherwise available.
15.11. Marshalling; Payments Set Aside. None of the
Administrative Agent, any Co-Agent, any Lender or any Issuing Bank shall be
under any obligation to ▇▇▇▇▇▇▇▇ any assets in favor of the Borrowers or any
other Person or against or in payment of any or all of the Obligations. To the
extent that the Borrowers make a payment or payments to the Administrative
Agent, the Co-Agents, the Lenders or Issuing Banks or any of such Persons
receives payment from the proceeds of the Collateral or exercises its rights of
setoff, and such payment or payments or the proceeds of such enforcement or
setoff or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required to be repaid to a trustee,
receiver or any other party, then to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied, and all Liens,
right and remedies therefor, shall be revived and continued in full force and
effect as if such payment had not been made or such enforcement or setoff had
not occurred.
15.12. Severability. In case any provision in or obligation
under this Agreement or the other Loan Documents shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
15.13. Headings. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement or be given any substantive effect.
15.14. Governing Law. THIS AGREEMENT SHALL BE INTERPRETED,
AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
15.15. Limitation of Liability. No claim may be made by the
Borrowers, any Lender, any Issuing Bank, the Administrative Agent, any
Co-Agent, or any other Person against the Borrowers, Administrative Agent, any
Co-Agent, any Issuing Bank or any Lender or the Affiliates, directors,
officers,
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employees, attorneys or agents of any of them for any special, consequential or
punitive damages in respect of any claim for breach of contract or any other
theory of liability arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring in connection
therewith; and the Borrowers, each Lender, each Issuing Bank, each Co-Agent,
and the Administrative Agent hereby waives, releases and agrees not to ▇▇▇ upon
any such claim for any such damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
15.16. Successors and Assigns. This Agreement and the other
Loan Documents shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and permitted assigns of the Lenders and the Issuing Banks. The
rights hereunder of the Borrowers, or any interest therein, may not be assigned
without the written consent of all Lenders.
15.17. Certain Consents and Waivers of the Borrowers.
(a) Personal Jurisdiction. (i) EACH OF THE ADMINISTRATIVE
AGENT, THE CO-AGENTS, THE LENDERS, THE ISSUING BANKS AND THE BORROWERS
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE COURT OR FEDERAL COURT SITTING
IN NEW YORK, NEW YORK, AND ANY COURT HAVING JURISDICTION OVER APPEALS OF
MATTERS HEARD IN SUCH COURTS, IN ANY ACTION OR PROCEEDING ARISING OUT OF,
CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG
THEM IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, WHETHER
ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE COURT OR, TO THE EXTENT
PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH BORROWER IRREVOCABLY DESIGNATES
AND APPOINTS CT CORPORATION SYSTEM, INC., ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, AS ITS AGENT (THE "PROCESS AGENT") FOR SERVICE OF ALL PROCESS IN ANY
SUCH PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED TO BE
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. EACH OF THE ADMINISTRATIVE
AGENT, THE CO-AGENTS, THE LENDERS, THE ISSUING BANKS AND EACH BORROWER AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW. EACH BORROWER WAIVES IN ALL DISPUTES ANY OBJECTION
THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(ii) EACH BORROWER AGREES THAT THE ADMINISTRATIVE AGENT SHALL
HAVE THE RIGHT TO PROCEED AGAINST SUCH BORROWER OR ITS PROPERTY IN A COURT IN
ANY LOCATION TO ENABLE THE
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ADMINISTRATIVE AGENT, THE CO-AGENTS, THE ISSUING BANKS AND THE LENDERS TO
REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO
ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF THE ADMINISTRATIVE
AGENT, ANY CO-AGENT, ANY ISSUING BANK OR ANY LENDER. EACH BORROWER AGREES THAT
IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY
THE ADMINISTRATIVE AGENT, ANY CO-AGENT, ANY LENDER OR ANY ISSUING BANK TO
REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO
ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE ADMINISTRATIVE AGENT,
ANY CO-AGENT, ANY LENDER OR ANY ISSUING BANK. EACH BORROWER WAIVES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH THE
ADMINISTRATIVE AGENT, ANY CO-AGENT, ANY ISSUING BANK OR ANY LENDER MAY COMMENCE
A PROCEEDING DESCRIBED IN THIS SECTION.
(b) Service of Process. EACH BORROWER IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH
ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT OR THE BORROWERS' NOTICE
ADDRESS SPECIFIED BELOW, SUCH SERVICE TO BECOME EFFECTIVE FIVE (5) DAYS AFTER
SUCH MAILING. EACH OF THE BORROWERS IRREVOCABLY WAIVES ANY OBJECTION
(INCLUDING, WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED
ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO
THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING HEREIN
SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT TO BRING PROCEEDINGS AGAINST
THE BORROWERS, OR EITHER OF THEM, IN THE COURTS OF ANY OTHER JURISDICTION.
(c) WAIVER OF JURY TRIAL. EACH OF THE ADMINISTRATIVE AGENT,
CO-AGENTS, LENDERS, ISSUING BANKS, AND BORROWERS IRREVOCABLY WAIVES TRIAL BY
JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT. EITHER OF THE BORROWERS AND ANY OF THE ADMINISTRATIVE AGENT,
CO-AGENTS, LENDERS, OR ISSUING BANKS MAY FILE AN ORIGINAL COUNTERPART OR A COPY
OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
15.18. Counterparts; Effectiveness; Inconsistencies. This
Agreement and any amendments, waivers, consents, or supplements hereto may be
executed in counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but one
and the same instrument. This Agreement shall become effective against each
Borrower, each Lender, each Issuing Bank, each Co-Agent, and the Administrative
Agent on the Effective Date subject to satisfaction of the conditions set forth
in Section 6.01. This Agreement and each of the other Loan Documents shall be
construed
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to the extent reasonable to be consistent one with the other, but to the extent
that the terms and conditions of this Agreement are actually inconsistent with
the terms and conditions of any other Loan Document, this Agreement shall
govern.
15.19. Limitation on Agreements. All agreements between the
Borrowers, the Administrative Agent, each Co-Agent, each Lender and each
Issuing Bank in the Loan Documents are hereby expressly limited so that in no
event shall any of the Loans or other amounts payable by the Borrowers under
any of the Loan Documents be directly or indirectly secured (within the meaning
of Regulation U) by Margin Stock.
15.20. Confidentiality. Subject to Section 15.01(f), the
Lenders and Issuing Banks shall hold all nonpublic information obtained
pursuant to the requirements of this Agreement and identified as such by the
Borrowers in accordance with such Lender's or Issuing Bank's customary
procedures for handling confidential information of this nature and in
accordance with safe and sound banking practices and in any event may make
disclosure reasonably required by a bona fide offeree, transferee or
participant in connection with the contemplated transfer or participation or as
required or requested by any Governmental Authority or representative thereof
or pursuant to legal process and shall require any such offeree, transferee or
participant to agree (and require any of its offerees, transferees or
participants to agree) to comply with this Section 15.20. In no event shall
any Lender or Issuing Bank be obligated or required to return any materials
furnished by the Borrowers; provided, however, each offeree shall be required
by the offeror Lender or Issuing Bank to agree that if it does not become a
transferee or participant it shall return all materials furnished to it by the
Borrowers or any other party to this Agreement in connection with this
Agreement. Any and all confidentiality agreements entered into between any
Lender or Issuing Bank and the Borrowers shall survive the execution of this
Agreement.
15.21. Entire Agreement. This Agreement, taken together
with all of the other Loan Documents, embodies the entire agreement and
understanding among the parties hereto, supersedes 1996 Commitment Letter and
all prior agreements and understandings, written and oral, relating to the
subject matter hereof, including, without limitation, the July 1996 Credit
Agreement which shall be and hereby is amended, superseded and restated in its
entirety by the terms and provisions of this Agreement. This Agreement shall
not constitute a novation.
15.22. Advice of Counsel. The Borrowers and each Lender
understand that the Administrative Agent's counsel represents only the
Administrative Agent's and its Affiliates' interests and that the Borrowers,
other Co-Agents, and other
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Lenders are advised to obtain their own counsel. The Borrowers each represent
and warrant to the Administrative Agent and the other Holders that it has
discussed this Agreement with its counsel.
IN WITNESS WHEREOF, this Agreement has been duly executed as
of the date first above written.
BORROWERS: BANNER AEROSPACE, INC.
----------
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President-Finance
BURBANK AIRCRAFT SUPPLY, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Notice Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
Dulles International Airport
Washington, D.C. 20041
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with copies to:
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
and
▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
Columbia Square
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
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ADMINISTRATIVE
AGENT: CITICORP USA, INC.
------
By /s/ ▇▇▇▇▇▇ ▇. ▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇
Attorney-in-Fact
Notice Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ 4
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
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184
ISSUING BANK: CITIBANK, N.A.
-------------
By /s/ ▇▇▇▇▇▇ ▇. ▇▇
----------------------------
▇▇▇▇▇▇ ▇. ▇▇
Attorney-in-Fact
Notice Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ 4
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
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185
LENDERS: CITICORP USA, INC.
-------
By /s/ ▇▇▇▇▇▇ ▇. ▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇
Attorney-in-Fact
Notice Address, Domestic Lending
Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ 4
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 28.80%
1995 Term Loan Commitment: $ 7,873,517.79
Tranche C Term Loan $35,000,000.00
Commitment:
Term Loan Commitment: $42,873,517.79
Revolving Credit Commitment: $11,728,260.87
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186
PNC BANK, NATIONAL ASSOCIATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
One Cleveland Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 7.50%
1995 Term Loan Commitment: $5,691,699.60
Revolving Credit Commitment: $8,478,260.87
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CAISSE NATIONALE DE CREDIT AGRICOLE
By /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇, FVP
Title: HEAD OF CORPORATE BANKING
CHICAGO
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 7.60%
1995 Term Loan Commitment: $3,794,466.40
Tranche C Term Loan
Commitment: $5,000,000.00
Term Loan Commitment: $8,794.466.40
Revolving Credit Commitment: $5,652,173.91
-178-
188
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., CHICAGO BRANCH
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President & Deputy
General Manager
Notice Address, Domestic Lending Office,
Eurodollar Lending Offfice or
Eurodollar Affiliate:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 4.90%
1995 Term Loan Commitment: $ 920,370.43
Revolving Credit Commitment: $ 8,312,716.03
-179-
189
NATIONSBANK, N.A.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 10.40%
1995 Term Loan Commitment: $7,873,517.79
Revolving Credit Commitment: $11,728,260.87
-180-
190
SANWA BUSINESS CREDIT CORPORATION
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 7.50%
1995 Term Loan Commitment: $5,691,699.60
Revolving Credit Commitment: $8,478,260.87
-181-
191
NBD BANK
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Authorized Agent
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
National Banking Division - Mezzanine
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 7.50%
1995 Term Loan Commitment: $5,691,699.60
Revolving Credit Commitment: $8,478,260.87
-182-
192
THE SUMITOMO BANK, LIMITED
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: VICE PRESIDENT AND MANAGER
Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
U.S. Commercial Banking Division
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Notice Address:
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 5.00%
1995 Term Loan Commitment: $3,794,466.40
Revolving Credit Commitment: $5,652,173.91
-183-
193
BANK POLSKA KASA OPIEKI, S.A.
By /s/ HUSSEIN B. EL-▇▇▇▇▇
--------------------------
Name: Hussein B. El-▇▇▇▇▇
Title: Vice President
Notice Address, Domestic Lending Office,
Eurodollar Lending Office or
Eurodollar Affiliate:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Hussein B. El-▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 2.50%
1995 Term Loan Commitment: $4,660.194.17
-184-
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PRIME RATE TRUST
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: PORTFOLIO ANALYST
Notice Address, Domestic Lending
Office, Eurodollar Lending Office
or Eurodollar Affiliate:
Two Renaissance Square
▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 7.90%
Tranche B Term Loan Commitment: $15,000,000
-185-
195
DEUTSCHE FINANCIAL SERVICES, INC.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
Notice Address:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 2.60%
1995 Term Loan Commitment: $2,008,368.20
Revolving Credit Commitment: $2,991,631.80
-186-
196
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING RATE
FUND, INC.
By /s/ R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------
Name: R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
Notice Address:
c/o Merrill ▇▇▇▇▇ Asset Management
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 2.60%
Tranche B Term Loan
Commitment: $5,000,000
-187-
197
▇▇▇▇▇▇▇ ▇▇▇▇▇ PRIME RATE PORTFOLIO
By
--------------------------
Name:
Title:
Notice Address:
c/o Merrill ▇▇▇▇▇ Asset Management
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 2.60%
Tranche B Term Loan
Commitment: $5,000,000
-188-
198
PROTECTIVE LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇ CFA
Title: Executive Vice President
Protective Asset Management, L.L.C.
Notice Address:
c/o Protective Asset Management Co.
1130 Two ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇-▇▇ #45
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Pro Rata Share: 2.60%
Tranche B Term Loan
Commitment: $5,000,000
-189-