EXHIBIT 10.2
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$255,000,000
CREDIT AGREEMENT
DATED AS OF FEBRUARY 12, 2004,
AMONG
PLY GEM INDUSTRIES, INC.,
AS U.S. BORROWER,
CWD WINDOWS AND DOORS, INC.
AS CANADIAN BORROWER,
PLY GEM HOLDINGS, INC.
AND
THE OTHER GUARANTORS PARTY HERETO,
AS GUARANTORS,
THE LENDERS PARTY HERETO,
UBS SECURITIES LLC
AND
DEUTSCHE BANK SECURITIES INC.,
AS JOINT LEAD ARRANGERS AND BOOKRUNNERS,
CIBC WORLD MARKETS CORP.
AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED,
AS CO-ARRANGERS,
UBS AG, STAMFORD BRANCH,
AS ISSUING BANK, ADMINISTRATIVE AGENT AND COLLATERAL AGENT,
UBS LOAN FINANCE LLC,
AS SWINGLINE LENDER,
DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH,
AS SYNDICATION AGENT,
AND
CANADIAN IMPERIAL BANK OF COMMERCE
AND
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION,
AS CO-DOCUMENTATION AGENTS
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
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TABLE OF CONTENTS
Section Page
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ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms...................................................2
SECTION 1.02 Classification of Loans and Borrowings.........................38
SECTION 1.03 Terms Generally................................................38
SECTION 1.04 Accounting Terms; GAAP.........................................38
SECTION 1.05 Resolution of Drafting Ambiguities.............................38
ARTICLE II
THE CREDITS
SECTION 2.01 Commitments....................................................38
SECTION 2.02 Loans..........................................................39
SECTION 2.03 Borrowing Procedure............................................40
SECTION 2.04 Evidence of Debt; Repayment of Loans...........................41
SECTION 2.05 Fees...........................................................42
SECTION 2.06 Interest on Loans..............................................42
SECTION 2.07 Termination and Reduction of Commitments.......................43
SECTION 2.08 Interest Elections.............................................44
SECTION 2.09 Amortization of Term Borrowings................................45
SECTION 2.10 Optional and Mandatory Prepayments of Loans and
Mandatory Offers to Redeem...................................46
SECTION 2.11 Alternate Rate of Interest.....................................50
SECTION 2.12 Increased Costs................................................50
SECTION 2.13 Breakage Payments..............................................51
SECTION 2.14 Payments Generally; Pro Rata Treatment; Sharing of Setoffs.....52
SECTION 2.15 Taxes..........................................................53
SECTION 2.16 Mitigation Obligations; Replacement of Lenders.................55
SECTION 2.17 Swingline Loans................................................56
SECTION 2.18 Letters of Credit..............................................57
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01 Organization; Powers...........................................62
SECTION 3.02 Authorization; Enforceability..................................62
SECTION 3.03 No Conflicts...................................................63
SECTION 3.04 Financial Statements; Projections..............................63
SECTION 3.05 Properties.....................................................64
SECTION 3.06 Intellectual Property..........................................64
SECTION 3.07 Equity Interests and Subsidiaries..............................65
SECTION 3.08 Litigation; Compliance with Laws...............................65
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Section Page
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SECTION 3.09 Agreements.....................................................66
SECTION 3.10 Federal Reserve Regulations....................................66
SECTION 3.11 Investment Company Act; Public Utility Holding Company Act.....66
SECTION 3.12 Use of Proceeds................................................66
SECTION 3.13 Taxes..........................................................67
SECTION 3.14 No Material Misstatements......................................67
SECTION 3.15 Labor Matters..................................................67
SECTION 3.16 Solvency.......................................................67
SECTION 3.17 Employee Benefit Plans.........................................68
SECTION 3.18 Environmental Matters..........................................68
SECTION 3.19 Insurance......................................................69
SECTION 3.20 Security Documents.............................................69
SECTION 3.21 Acquisition Documents; Representations and Warranties
in Acquisition Agreement.....................................71
SECTION 3.22 Anti-Terrorism Law.............................................71
SECTION 3.23 Subordination of Senior Subordinated Notes.....................72
ARTICLE IV
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01 Conditions to Initial Credit Extension.........................72
SECTION 4.02 Conditions to All Credit Extensions............................77
ARTICLE V
AFFIRMATIVE COVENANTS
SECTION 5.01 Financial Statements, Reports, etc.............................78
SECTION 5.02 Litigation and Other Notices...................................80
SECTION 5.03 Existence; Businesses and Properties...........................80
SECTION 5.04 Insurance......................................................81
SECTION 5.05 Obligations and Taxes..........................................82
SECTION 5.06 Employee Benefits..............................................82
SECTION 5.07 Maintaining Records; Access to Properties and Inspections;
Annual Meetings.................. ...........................83
SECTION 5.08 Use of Proceeds................................................83
SECTION 5.09 Compliance with Environmental Laws; Environmental Reports......83
SECTION 5.10 Additional Collateral; Additional Guarantors...................83
SECTION 5.11 Security Interests; Further Assurances.........................86
SECTION 5.12 Information Regarding Collateral...............................86
SECTION 5.13 Post-Closing Matters...........................................87
ARTICLE VI
NEGATIVE COVENANTS
SECTION 6.01 Indebtedness...................................................89
SECTION 6.02 Liens..........................................................91
SECTION 6.03 Sale and Leaseback Transactions................................93
SECTION 6.04 Investment, Loan and Advances..................................93
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Section Page
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SECTION 6.05 Mergers and Consolidations.....................................94
SECTION 6.06 Asset Sales....................................................95
SECTION 6.07 Acquisitions...................................................96
SECTION 6.08 Dividends......................................................97
SECTION 6.09 Transactions with Affiliates...................................97
SECTION 6.10 Financial Covenants............................................99
SECTION 6.11 Prepayments of Other Indebtedness; Modifications of
Organizational Documents and Other Documents, etc...........100
SECTION 6.12 Limitation on Certain Restrictions on Subsidiaries............101
SECTION 6.13 Limitation on Issuance of Capital Stock.......................101
SECTION 6.14 Limitation on Creation of Subsidiaries........................102
SECTION 6.15 Business......................................................102
SECTION 6.16 Limitation on Accounting Changes..............................102
SECTION 6.17 Fiscal Year...................................................102
SECTION 6.18 Lease Obligations.............................................102
SECTION 6.19 No Further Negative Pledge....................................102
SECTION 6.20 Anti-Terrorism Law; Anti-Money Laundering.....................103
SECTION 6.21 Embargoed Person..............................................103
ARTICLE VII
GUARANTEE
SECTION 7.01 The Guarantee.................................................103
SECTION 7.02 Obligations Unconditional.....................................104
SECTION 7.03 Reinstatement.................................................105
SECTION 7.04 Subrogation; Subordination....................................105
SECTION 7.05 Remedies......................................................105
SECTION 7.06 Instrument for the Payment of Money...........................106
SECTION 7.07 Continuing Guarantee..........................................106
SECTION 7.08 General Limitation on Guarantee Obligations...................106
SECTION 7.09 Release of Guarantors.........................................106
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 Events of Default.............................................106
ARTICLE IX
COLLATERAL ACCOUNT; APPLICATION OF COLLATERAL PROCEEDS
SECTION 9.01 Collateral Account............................................109
SECTION 9.02 Proceeds of Destruction, Taking and Collateral
Dispositions................................ ...............110
SECTION 9.03 Application of Proceeds.......................................110
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Section Page
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ARTICLE X
THE AGENTS
SECTION 10.01 Appointment...................................................111
SECTION 10.02 Agent in Its Individual Capacity..............................111
SECTION 10.03 Exculpatory Provisions........................................111
SECTION 10.04 Reliance by Agent.............................................112
SECTION 10.05 Delegation of Duties..........................................112
SECTION 10.06 Successor Agent...............................................112
SECTION 10.07 Non-Reliance on Agent and Other Lenders.......................113
SECTION 10.08 Name Agents...................................................113
SECTION 10.09 Indemnification...............................................113
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 Notices.......................................................113
SECTION 11.02 Waivers; Amendment............................................114
SECTION 11.03 Expenses; Indemnity...........................................117
SECTION 11.04 Successors and Assigns........................................119
SECTION 11.05 Survival of Agreement.........................................121
SECTION 11.06 Counterparts; Integration; Effectiveness......................121
SECTION 11.07 Severability..................................................122
SECTION 11.08 Right of Setoff...............................................122
SECTION 11.09 Governing Law; Jurisdiction; Consent to Service of Process....122
SECTION 11.10 Waiver of Jury Trial..........................................123
SECTION 11.11 Headings......................................................123
SECTION 11.12 Confidentiality...............................................123
SECTION 11.13 Interest Rate Limitation......................................123
SECTION 11.14 Lender Addendum...............................................124
SECTION 11.15 Obligations Absolute..........................................124
SECTION 11.16 Judgment Currency.............................................124
ANNEXES
Annex I Applicable Margin
Annex II Amortization Table
SCHEDULES
Schedule 1.01(a) Assumed Debt
Schedule 1.01(b) Consolidated EBITDA Adjustments
Schedule 1.01(c) Material Indebtedness
Schedule 1.01(d) Mortgaged Property
Schedule 1.01(e) Refinancing Indebtedness to Be Repaid
Schedule 1.01(f) U.S. Subsidiary Guarantors
Schedule 3.03 Governmental Approvals; Compliance with Laws
Schedule 3.05(b) Real Property
Schedule 3.07(a) Subsidiaries
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Schedule 3.07(c) Corporate Organizational Chart
Schedule 3.09(c) Material Agreements
Schedule 3.17 Employee Benefit Plans
Schedule 3.18 Environmental Matters
Schedule 3.19 Insurance
Schedule 3.21 Acquisition Documents
Schedule 4.01(g) Local Counsel
Schedule 4.01(n)(vi) Landlord Access Agreements
Schedule 4.01(o)(iii) Title Insurance Amounts
Schedule 5.13(c) Post-Closing Matters
Schedule 6.01(b) Existing Indebtedness
Schedule 6.02(c) Existing Liens
Schedule 6.04(b) Existing Investments
Schedule 6.09(n) Existing Affiliate Agreements
EXHIBITS
Exhibit A Form of Administrative Questionnaire
Exhibit B Form of Assignment and Assumption
Exhibit C-1 Form of U.S. Borrowing Request
Exhibit C-2 Form of Canadian Borrowing Request
Exhibit D Form of Compliance Certificate
Exhibit E Form of Interest Election Request
Exhibit F Form of Joinder Agreement
Exhibit G-1 Form of U.S. Landlord Access Agreement
Exhibit G-2 Form of Canadian Landlord Access Agreement
Exhibit H Form of LC Request
Exhibit I Form of Lender Addendum
Exhibit J-1 Form of Mortgage
Exhibit J-2 Form of Canadian Mortgage
Exhibit J-3 Form of Leasehold Mortgage
Exhibit K-1 Form of U.S. Term Note
Exhibit K-2 Form of Canadian Term Note
Exhibit K-3 Form of Revolving Note
Exhibit K-4 Form of Swingline Note
Exhibit L-1 Form of Perfection Certificate
Exhibit L-2 Form of Perfection Certificate Supplement
Exhibit M-1 Form of U.S. Security Agreement
Exhibit M-2 Form of Canadian Security Agreement
Exhibit N-1 Form of Opinion of Company Counsel
Exhibit N-2 Form of Opinion of Local Counsel
Exhibit N-3 Form of Opinion of Canadian Counsel
Exhibit O Form of Solvency Certificate
Exhibit P-1 Form of U.S. Intercompany Note
Exhibit P-2 Form of Canadian Intercompany Note
Exhibit Q Form of U.S. Tax Compliance Certificate
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CREDIT AGREEMENT
This CREDIT AGREEMENT (this "AGREEMENT") dated as of February 12, 2004,
among PLY GEM INDUSTRIES, INC., a Delaware corporation ("U.S. BORROWER"), CWD
Windows and Doors, Inc., a corporation organized under the federal laws of
Canada ("CANADIAN BORROWER" and, together with U.S. Borrower, each a "BORROWER"
and collectively the "BORROWERS"), PLY GEM HOLDINGS, INC., a Delaware
corporation ("PARENT"), the Subsidiary Guarantors (such term and each other
capitalized term used but not defined herein having the meaning given to it in
ARTICLE I), the Lenders, UBS SECURITIES LLC and DEUTSCHE BANK SECURITIES INC.,
as joint lead arrangers and bookrunners (in such capacity, "JOINT LEAD
ARRANGERS"), CIBC WORLD MARKETS CORP. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO., ▇▇▇▇▇▇▇ LYNCH,
PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED, as co-arrangers (in such capacities,
"CO-ARRANGERS"), CANADIAN IMPERIAL BANK OF COMMERCE and ▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL
CORPORATION, as co-documentation agents (in such capacities, "CO-DOCUMENTATION
AGENTS"), DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH, as syndication agent (in such
capacity, "SYNDICATION AGENT"), UBS LOAN FINANCE LLC, as swingline lender (in
such capacity, "SWINGLINE LENDER"), and UBS AG, STAMFORD BRANCH, as issuing bank
(in such capacity, "ISSUING BANK"), as administrative agent (in such capacity,
"ADMINISTRATIVE AGENT") for the Lenders and as collateral agent (in such
capacity, "COLLATERAL AGENT") for the Secured Parties and the Issuing Bank.
WITNESSETH:
WHEREAS, Holdings has entered into a stock purchase agreement, dated as
of December 19, 2003, as amended on January 23, 2004 and February 12, 2004 (as
further amended, supplemented or otherwise modified from time to time in
accordance with the provisions hereof and thereof, the "ACQUISITION Agreement"),
with Nortek Inc., a Delaware corporation, and WDS LLC, a Delaware limited
liability company and a direct wholly-owned subsidiary of Nortek, Inc.
(collectively, the "SELLER"), to acquire (the "ACQUISITION") all of the capital
stock of U.S. Borrower, and on or prior to the Closing Date, Holdings will
transfer its rights and obligations under the Acquisition Agreement to Parent.
WHEREAS, the Refinancing, the Acquisition, the issuance of the Senior
Subordinated Notes and the Equity Financing shall be consummated simultaneously
herewith.
WHEREAS, U.S. Borrower has requested the U.S. Lenders to extend credit
in the form of (a) U.S. Term Loans on the Closing Date, in an aggregate
principal amount not in excess of $160.0 million, and (b) Revolving Loans at any
time and from time to time prior to the Revolving Maturity Date, in an aggregate
principal amount at any time outstanding not in excess of $65.0 million, of
which no more than $3.0 million may be drawn on the Closing Date.
WHEREAS, Canadian Borrower has requested the Canadian Term Loan Lenders
to extend credit in the form of Canadian Term Loans on the Closing Date, in an
aggregate principal amount not in excess of $30.0 million.
WHEREAS, U.S. Borrower has requested the Swingline Lender to make
Swingline Loans, at any time and from time to time prior to the Revolving
Maturity Date, in an aggregate principal amount at any time outstanding not in
excess of $10.0 million.
WHEREAS, U.S. Borrower has requested the Issuing Bank to issue letters
of credit, in an aggregate face amount at any time outstanding not in excess of
$35.0 million, for the account of U.S. Borrower and its Subsidiaries.
WHEREAS, the proceeds of the Loans are to be used in accordance with
SECTION 3.12.
NOW, THEREFORE, the Lenders are willing to extend such credit to the
Borrowers and the Issuing Bank is willing to issue letters of credit for the
account of U.S. Borrower on the terms and subject to the conditions set forth
herein. Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINED TERMS. As used in this Agreement, the
following terms shall have the meanings specified below:
"ABR," when used in reference to any Loan or Borrowing, is used when
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any ABR Term Loan or ABR Revolving Loan.
"ABR REVOLVING LOAN" shall mean any Revolving Loan bearing interest at
a rate determined by reference to the Alternate Base Rate in accordance with the
provisions of ARTICLE II.
"ABR TERM LOAN" shall mean any Term Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with the
provisions of ARTICLE II.
"ACQUISITION" shall have the meaning assigned to such term in the first
recital hereto.
"ACQUISITION AGREEMENT" shall have the meaning assigned to such term in
the first recital hereto.
"ACQUISITION CONSIDERATION" shall mean the purchase consideration for
any Permitted Acquisition and all other payments by Parent or any of its
Subsidiaries in exchange for, or as part of, or in connection with, any
Permitted Acquisition (other than fees and expenses related to such Permitted
Acquisition), whether paid in cash or by exchange of Equity Interests or of
properties or otherwise and whether payable at or prior to the consummation of
such Permitted Acquisition or deferred for payment at any future time, whether
or not any such future payment is subject to the occurrence of any contingency,
and includes any and all payments representing the purchase price and any
assumptions of Indebtedness, "earn-outs" and other agreements to make any
payment the amount of which is, or the terms of payment of which are, in any
respect subject to or contingent upon the revenues, income, cash flow or profits
(or the like) of any person or business; PROVIDED that any such future payment
that is subject to a contingency shall be considered Acquisition Consideration
only to the extent of the reserve, if any, required under GAAP at the time of
such sale to be established in respect thereof by Parent or any of its
Subsidiaries.
"ACQUISITION DOCUMENTS" shall mean the collective reference to the
Acquisition Agreement and the other documents listed on SCHEDULE 3.21.
"ADDITIONAL TERM LOANS" shall have the meaning assigned to such term in
SECTION 11.02(d).
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"ADJUSTED LIBOR RATE" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, (a) an interest rate per annum (rounded
upward, if necessary, to the next 1/100th of 1%) determined by the
Administrative Agent to be equal to the LIBOR Rate for such Eurodollar Borrowing
in effect for such Interest Period divided by (b) 1 MINUS the Statutory Reserves
(if any) for such Eurodollar Borrowing for such Interest Period.
"ADMINISTRATIVE AGENT" shall have the meaning assigned to such term in
the preamble hereto and includes each other person appointed as the successor
pursuant to ARTICLE X.
"ADMINISTRATIVE AGENT FEES" shall have the meaning assigned to such
term in SECTION 2.05(b).
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in the form of EXHIBIT A, or such other form as may be supplied
from time to time by the Administrative Agent.
"ADVISORY SERVICES AGREEMENT" means the advisory services agreement,
dated as of February 12, 2004, among U.S. Borrower and Sponsor.
"AFFILIATE" shall mean, when used with respect to a specified person,
another person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the person
specified; PROVIDED, HOWEVER, that, for purposes of SECTION 6.09, the term
"Affiliate" shall also include (i) any person that directly or indirectly owns
more than 10% of any class of Equity Interests of the person specified or (ii)
any person that is an executive officer or director of the person specified.
"AGENTS" shall mean the Arrangers, the Co-Documentation Agents, the
Syndication Agent, the Administrative Agent and the Collateral Agent; and
"AGENT" shall mean any of them.
"AGREEMENT" shall have the meaning assigned to such term in the
preamble hereto.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum
(rounded upward, if necessary, to the next 1/100th of 1%) equal to the greater
of (a) the Base Rate in effect on such day and (b) the Federal Funds Effective
Rate in effect on such day PLUS 0.50%. If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the Base
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Base Rate or the Federal Funds Effective Rate,
respectively.
"ANTI-TERRORISM LAWS" shall have the meaning assigned to such term in
SECTION 3.22.
"APPLICABLE FEE" shall mean, for any day, with respect to any
Commitment, the applicable percentage set forth in ANNEX I under the caption
"Applicable Fee".
"APPLICABLE MARGIN" shall mean, for any day, with respect to any (i)
Term Loan, (x) 2.75% for Eurodollar Loans and (y) 1.75% for ABR Loans, and (ii)
Revolving Loan, the applicable percentage set forth in ANNEX I.
"ARRANGERS" shall mean the Joint Lead Arrangers and the Co-Arrangers.
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"ASSET SALE" shall mean (a) any conveyance, sale, lease, sublease,
assignment, transfer or other disposition (including by way of merger or
consolidation and including any Sale and Leaseback Transaction) of any property
excluding sales of inventory and dispositions of cash equivalents, in each case,
in the ordinary course of business, by Parent or any of its Subsidiaries and (b)
any issuance or sale of any Equity Interests of any Subsidiary of Parent, in
each case, to any person other than (i) either Borrower, (ii) any Subsidiary
Guarantor or (iii) other than for purposes of SECTION 6.06, any other
Subsidiary.
"ASSIGNMENT AND ASSUMPTION" shall mean an assignment and assumption
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, substantially in the form of EXHIBIT B, or such other form as shall be
approved by the Administrative Agent.
"ASSUMED DEBT" shall mean the Indebtedness set forth on SCHEDULE
1.01(a) hereto.
"BAILEE LETTER" shall have the meaning assigned thereto in the Security
Agreement.
"BASE RATE" shall mean, for any day, a rate per annum that is equal to
the corporate base rate of interest established by the Administrative Agent in
the United States for dollars from time to time; each change in the Base Rate
shall be effective on the date such change is effective. The corporate base rate
is not necessarily the lowest rate charged by the Administrative Agent to its
customers.
"BOARD" shall mean the Board of Governors of the Federal Reserve System
of the United States.
"BOARD OF DIRECTORS" shall mean, with respect to any person, (i) in the
case of any corporation, the board of directors of such person, (ii) in the case
of any limited liability company, the board of managers of such person, (iii) in
the case of any partnership, the Board of Directors of the general partner of
such person and (iv) in any other case, the functional equivalent of the
foregoing.
"BORROWER" shall have the meaning assigned to such term in the preamble
hereto.
"BORROWING" shall mean (a) Loans of the same Class and Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect, or (b) a Swingline Loan.
"BORROWING REQUEST" shall mean either a U.S. Borrowing Request or a
Canadian Borrowing Request as the context shall require.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or
other day on which banks in New York City are authorized or required by law to
close; PROVIDED, HOWEVER, that when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"▇▇▇▇▇▇ PROPERTY" shall have the meaning assigned to such term in
SECTION 5.13(a).
"CALCULATION PERIOD" shall have the meaning assigned to such term in
SECTION 2.06(f).
"CANADIAN BORROWER" shall have the meaning assigned to such term in the
preamble hereto.
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"CANADIAN BORROWING REQUEST" shall mean a request by Canadian Borrower
in accordance with the terms of SECTION 2.03 and substantially in the form of
EXHIBIT C-2, or such other form as shall be approved by the Administrative
Agent.
"CANADIAN COLLATERAL ACCOUNT" shall mean a collateral account or
sub-account established and maintained by the Collateral Agent for the benefit
of the Canadian Secured Parties, in accordance with the provisions of SECTION
9.01.
"CANADIAN GUARANTEED OBLIGATIONS" shall have the meaning assigned to
such term in SECTION 7.01.
"CANADIAN GUARANTORS" shall have the meaning assigned to such term in
SECTION 7.01.
"CANADIAN INTERCOMPANY NOTE" shall mean a promissory note substantially
in the form of EXHIBIT P-2.
"CANADIAN LOAN PARTIES" shall mean Canadian Borrower and the Canadian
Guarantors; PROVIDED that Parent and U.S. Borrower shall only constitute
Canadian Loan Parties in their capacities as Canadian Guarantors.
"CANADIAN MORTGAGED PROPERTY" shall mean the Mortgaged Property owned
or leased by the Canadian Loan Parties.
"CANADIAN OBLIGATIONS" shall mean (a) obligations of Canadian Borrower
and the other Canadian Loan Parties from time to time arising under or in
respect of the due and punctual payment of (i) the principal of and premium, if
any, and interest (including interest accruing during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding) on the Canadian Term Loans,
when and as due, whether at maturity, by acceleration, upon one or more dates
set for prepayment or otherwise and (ii) all other monetary obligations,
including fees, costs, expenses and indemnities, whether primary, secondary,
direct, contingent, fixed or otherwise (including monetary obligations incurred
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding), of
Canadian Borrower and the other Canadian Loan Parties under this Agreement and
the other Loan Documents, (b) the due and punctual performance of all covenants,
agreements, obligations and liabilities of Canadian Borrower and the other
Canadian Loan Parties under or pursuant to this Agreement and the other Loan
Documents, (c) the due and punctual payment and performance of all obligations
of Canadian Borrower and the other Canadian Loan Parties under each Hedging
Agreement relating to either the Canadian Term Loans or foreign currency
exchange rates entered into with any counterparty that was a Lender or an
Affiliate of a Lender at the time such Hedging Agreement was entered into
(provided that each shall provide that it terminates or expires upon, or prior
to, the repayment of all Loans hereunder) (each, a "PERMITTED CANADIAN HEDGING
AGREEMENT") and (d) the due and punctual payment and performance of all
obligations in respect of overdrafts and related liabilities owed to any
Canadian Term Loan Lender, any Affiliate of a Canadian Term Loan Lender, the
Administrative Agent or the Collateral Agent arising from treasury, depositary
and cash management services or in connection with any automated clearinghouse
transfer of funds, in each case, with respect to Canadian Term Loans.
"CANADIAN SECURED PARTIES" shall mean, collectively, the Administrative
Agent, the Collateral Agent, each other Agent, the Lenders and each party to a
Permitted Canadian Hedging Agreement if such person executes and delivers to the
Administrative Agent a letter agreement in form and substance reasonably
acceptable to the Administrative Agent pursuant to which such person (i)
appoints the
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Collateral Agent as its agent under the applicable Loan Documents and (ii)
agrees to be bound by the provisions of SECTIONS 11.03 and 11.09.
"CANADIAN SECURITY AGREEMENT" shall mean a Security Agreement
substantially in the form of EXHIBIT M-2 among the Canadian Loan Parties and
Collateral Agent for the benefit of the Canadian Secured Parties.
"CANADIAN SECURITY AGREEMENT COLLATERAL" shall mean all property
pledged or granted as collateral pursuant to the Canadian Security Agreement
delivered on the Closing Date or thereafter pursuant to SECTION 5.10.
"CANADIAN SECURITY DOCUMENTS" shall mean the Canadian Security
Agreement, the Mortgages entered into by the Canadian Loan Parties and each
other security document or pledge agreement delivered in accordance with
applicable local or foreign law to grant a valid, perfected security interest in
any property as collateral for the Canadian Obligations, and all financing
statements or instruments of perfection required by this Agreement, the Canadian
Security Agreement or any other such security document or pledge agreement to be
filed with respect to the security interests in property and fixtures created
pursuant to the Canadian Security Agreement and any other document or instrument
utilized to pledge as collateral for the Canadian Obligations any property.
"CANADIAN SUBSIDIARY" shall mean a Subsidiary of Canadian Borrower.
"CANADIAN SUBSIDIARY GUARANTOR" shall mean a Canadian Subsidiary that
is or becomes a party to this Agreement pursuant to SECTION 5.10.
"CANADIAN TERM LOAN" shall mean the term loans made by the Canadian
Term Loan Lenders to Canadian Borrower pursuant to SECTION 2.01(b). Each
Canadian Term Loan shall be either an ABR Term Loan or a Eurodollar Term Loan.
"CANADIAN TERM LOAN COMMITMENT" shall mean, with respect to each
Canadian Term Loan Lender, the commitment, if any, of such Canadian Term Loan
Lender to make a Canadian Term Loan hereunder on the Closing Date in the amount
set forth on Schedule I to the Lender Addendum executed and delivered by such
Canadian Term Loan Lender. The aggregate amount of the Lenders' Canadian Term
Loan Commitments is $30.0 million.
"CANADIAN TERM LOAN LENDERS" shall mean (a) the financial institutions
that have become a party hereto pursuant to a Lender Addendum that provide
Canadian Term Loan Commitments or make Canadian Term Loans and (b) any financial
institution that has become a party hereto pursuant to an Assignment and
Assumption that provides Canadian Term Loan Commitments or makes Canadian Term
Loans, other than, in each case, any such financial institution that has ceased
to be a party hereto pursuant to an Assignment and Assumption.
"CAPEX CARRYFOWARD AMOUNT" shall have the meaning assigned to such term
in SECTION 6.10(c).
"CAPITAL EXPENDITURES" shall mean, for any period, without duplication,
the increase during that period in the gross property, plant or equipment
account in the consolidated balance sheet of U.S. Borrower and its Subsidiaries,
determined in accordance with GAAP, whether such increase is due to purchase of
properties for cash or financed by the incurrence of Indebtedness, but excluding
(i) expenditures made in connection with the replacement, substitution or
restoration of property pursuant
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to SECTION 2.10(f) and (ii) any portion of such increase attributable solely to
acquisitions of property, plant and equipment in Permitted Acquisitions.
"CAPITAL LEASE OBLIGATIONS" of any person shall mean the obligations of
such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"CASH EQUIVALENTS" shall mean, as to any person, (a) securities issued,
or directly, unconditionally and fully guaranteed or insured, by the United
States or Canada or any agency or instrumentality thereof (PROVIDED that the
full faith and credit of the United States or Canada is pledged in support
thereof) having maturities of not more than one year from the date of
acquisition by such person; (b) time deposits and certificates of deposit of (1)
any Lender or Agent or (2) any commercial bank having, or which is the principal
banking subsidiary of a bank holding company organized under the laws of the
United States or Canada, any state or province thereof or the District of
Columbia having, capital and surplus aggregating in excess of $500.0 million and
a rating of "A" (or such other similar equivalent rating) or higher by at least
one nationally recognized statistical rating organization (as defined in Rule
436 under the Securities Act) with maturities of not more than one year from the
date of acquisition by such person; (c) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in clause
(a) above entered into with any bank meeting the qualifications specified in
clause (b) above, which repurchase obligations are secured by a valid perfected
security interest in the underlying securities; (d) commercial paper issued by
any person incorporated in the United States or Canada rated at least A-1 or the
equivalent thereof by Standard & Poor's Rating Service or at least P-1 or the
equivalent thereof by ▇▇▇▇▇'▇ Investors Service Inc., and in each case maturing
not more than one year after the date of acquisition by such person; (e)
investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (a) through (d) above;
and (f) demand deposit accounts maintained in the ordinary course of business.
"CASH INTEREST EXPENSE" shall mean, for any period, Consolidated
Interest Expense for such period, LESS the sum of (a) interest on any debt paid
by the increase in the principal amount of such debt including by issuance of
additional debt of such kind and (b) items described in clause (c) or, other
than to the extent paid in cash, clauses (f) and (g) of the definition of
"Consolidated Interest Expense."
"CASUALTY EVENT" shall mean any loss of title or any loss of or damage
to or destruction of, or any condemnation or other taking (including by any
Governmental Authority) of, any property of Parent or any of its Subsidiaries.
"Casualty Event" shall include but not be limited to any taking of all or any
part of any Real Property of any person or any part thereof, in or by
condemnation or other eminent domain proceedings pursuant to any law, or by
reason of the temporary requisition of the use or occupancy of all or any part
of any Real Property of any person or any part thereof by any Governmental
Authority, civil or military, or any settlement in lieu thereof.
"CDC" shall have the meaning assigned to such term in SECTION 5.13(a).
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. section 9601 et
seq.
A "CHANGE IN CONTROL" shall be deemed to have occurred if:
(a) Parent at any time ceases to own 100% of the Equity Interests
of U.S. Borrower or, prior to an IPO at Parent, Holdings ceases to own
100% of the Equity Interests of Parent;
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(b) at any time a change of control (as defined in the
documentation for any Material Indebtedness) shall occur;
(c) prior to an IPO, (i) the Permitted Holders cease to own
(directly or indirectly), or to have the power to vote or direct the
voting of, Voting Stock of U.S. Borrower representing a majority of the
voting power of the total outstanding Voting Stock of U.S. Borrower or
(ii) the Permitted Holders cease to own (directly or indirectly) Equity
Interests representing a majority of the total economic interests of the
Equity Interests of U.S. Borrower;
(d) following an IPO, (i) the Permitted Holders shall fail to own
(directly or indirectly), or to have the power to vote or direct the
voting of, Voting Stock of U.S. Borrower representing more than 35% of the
voting power of the total outstanding Voting Stock of U.S. Borrower, (ii)
the Permitted Holders cease to own (directly or indirectly) Equity
Interests representing more than 35% of the total economic interests of
the Equity Interests of U.S. Borrower or (iii) any "person" or "group" (as
such terms are used in Sections 13(d) and 14(d) of the Exchange Act),
other than one or more Permitted Holders, is or becomes the beneficial
owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that for purposes of this clause such person or group shall be deemed to
have "beneficial ownership" of all securities that such person or group
has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of Voting Stock
of U.S. Borrower representing more than the voting power of the Voting
Stock of U.S. Borrower owned by the Permitted Holders; or
(e) following an IPO, during any period of two consecutive years,
individuals who at the beginning of such period constituted the Board of
Directors of the IPO Entity (together with any new directors whose
election to such Board of Directors or whose nomination for election was
approved by a vote of a majority of the members of the Board of Directors
of the IPO Entity, which members comprising such majority are then still
in office and were either directors at the beginning of such period or
whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board of Directors of
the IPO Entity.
For purposes of this definition, a person shall not be deemed to have
beneficial ownership of Equity Interests subject to a stock purchase agreement,
merger agreement or similar agreement until the consummation of the transactions
contemplated by such agreement.
"CHANGE IN LAW" shall mean (a) the adoption of any law, treaty, order,
policy, rule or regulation or any interpretation or application thereof by any
Governmental Authority after the date of this Agreement, (b) any change in any
law, treaty, order, policy, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this
Agreement or (c) compliance by any Lender or Issuing Bank (or for purposes of
SECTION 2.12(b), by any lending office of such Lender or by such Lender's or
Issuing Bank's holding company, if any) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
"CHARGES" shall have the meaning assigned to such term in SECTION
11.13.
"CLASS," when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans,
U.S. Term Loans, Canadian Term Loans or Swingline Loans and, when used in
reference to any Commitment, refers to whether such Commitment is a Revolving
Commitment, U.S. Term Loan Commitment, Canadian Term Loan Commitment or
Swingline Commitment, in each case, under this Agreement as originally in effect
or pursuant to SECTION 11.02(d), of which such Loan, Borrowing or Commitment
shall be a part.
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"CLOSING DATE" shall mean the date of the initial Credit Extension
hereunder.
"CO-ARRANGERS" shall have the meaning assigned to such term in the
preamble hereto.
"CO-DOCUMENTATION AGENTS" shall have the meaning assigned to such term
in the preamble hereto.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL" shall mean, collectively, all of the U.S. Security
Agreement Collateral, the Canadian Security Agreement Collateral, the Mortgaged
Property and all other property of whatever kind and nature pledged as
collateral under any Security Document.
"COLLATERAL ACCOUNT" shall mean the Canadian Collateral Account or the
U.S. Collateral Account, as applicable.
"COLLATERAL AGENT" shall have the meaning assigned to such term in the
preamble hereto.
"COMMERCIAL LETTER OF CREDIT" shall mean any letter of credit or
similar instrument issued for the purpose of providing credit support in
connection with the purchase of materials, goods or services by U.S. Borrower or
any of its Subsidiaries in the ordinary course of their businesses.
"COMMITMENT" shall mean, with respect to any Lender, such Lender's
Revolving Commitment, U.S. Term Loan Commitment, Canadian Term Loan Commitment
or Swingline Commitment, and any Commitment to make Term Loans or Revolving
Loans of a new Class extended by such Lender as provided in SECTION 11.02(d).
"COMMITMENT FEE" shall have the meaning assigned to such term in
SECTION 2.05(a).
"COMPANIES" shall mean Parent and its Subsidiaries; and "COMPANY" shall
mean any one of them.
"COMPLIANCE CERTIFICATE" shall mean a certificate of a Financial
Officer substantially in the form of EXHIBIT D.
"CONFIDENTIAL INFORMATION MEMORANDUM" shall mean that certain
confidential information memorandum dated as of January 2004 relating to U.S.
Borrower and its subsidiaries.
"CONSOLIDATED AMORTIZATION EXPENSE" shall mean, for any period, the
amortization expense of U.S. Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED CURRENT ASSETS" shall mean, as at any date of
determination, the total assets of U.S. Borrower and its Subsidiaries which may
properly be classified as current assets on a consolidated balance sheet of U.S.
Borrower and its Subsidiaries in accordance with GAAP.
"CONSOLIDATED CURRENT LIABILITIES" shall mean, as at any date of
determination, the total liabilities of U.S. Borrower and its Subsidiaries which
may properly be classified as current liabilities (other than the current
portion of any Loans) on a consolidated balance sheet of U.S. Borrower and its
Subsidiaries in accordance with GAAP.
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"CONSOLIDATED DEPRECIATION EXPENSE" shall mean, for any period, the
depreciation expense of U.S. Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED EBITDA" shall mean, for any period, Consolidated Net
Income for such period, adjusted by (x) ADDING THERETO, in each case only to the
extent (and in the same proportion) deducted in determining such Consolidated
Net Income (and with respect to the portion of Consolidated Net Income
attributable to any Subsidiary of U.S. Borrower (other than any Foreign
Subsidiary or any U.S. Subsidiary Guarantor) only if a corresponding amount
would be permitted at the date of determination to be distributed to U.S.
Borrower by such Subsidiary without prior approval (that has not been obtained),
pursuant to the terms of its Organizational Documents and all agreements (other
than any municipal loan or related agreements entered into in connection with
the incurrence of industrial or economic revenue bonds), instruments, judgments,
decrees, orders, statutes, rules and regulations applicable to such Subsidiary
or its equityholders):
(a) Consolidated Interest Expense for such period,
(b) Consolidated Amortization Expense for such period,
(c) Consolidated Depreciation Expense for such period,
(d) Consolidated Tax Expense for such period,
(e) costs and expenses directly incurred in connection with the
Transactions during such period (not to exceed $30.0 million) to the
extent actually incurred and expensed within one year of the Closing Date,
(f) the aggregate amount of all other non-cash items reducing
Consolidated Net Income (excluding any non-cash charge that results in an
accrual of a reserve for cash charges in any future period) for such
period,
(g) the amount of management fees paid to Sponsor for such period
pursuant to the Advisory Services Agreement in accordance with SECTION
6.09(e),
(h) Restructuring Expenses in an aggregate amount not to exceed
$10.0 million in any Test Period and any Restructuring Expenses in
connection with the disposition of Thermal-Gard, Inc., and
(y) SUBTRACTING THEREFROM the aggregate amount of all non-cash items increasing
Consolidated Net Income (other than the accrual of revenue or recording of
receivables in the ordinary course of business) for such period, and (z) ADDING
THERETO OR SUBTRACTING THEREFROM, without duplication of amounts included as
Restructuring Expenses, with respect to any part of a Test Period, the
adjustments to Consolidated EBITDA set forth on SCHEDULE 1.01(b).
Other than for purposes of calculating Excess Cash Flow, Consolidated
EBITDA shall be calculated on a Pro Forma Basis (including any Pro Forma Cost
Savings) to give effect to the Acquisition, any Permitted Acquisition, each
Permitted Sale and Leaseback Transaction and other Asset Sales for consideration
individually or in the aggregate in excess of $3.0 million during any Test
Period consummated at any time on or after the first day of the Test Period
thereof as if the Acquisition and each such Permitted Acquisition had been
effected on the first day of such period and as if each such Permitted Sale and
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Leaseback Transaction and other Asset Sale had been consummated on the day prior
to the first day of such period.
Notwithstanding the foregoing, Consolidated EBITDA for each of the
first three fiscal quarters of 2003 shall be increased by the amounts indicated
on SCHEDULE 1.01(b) to account for the items described thereon to the extent any
such amounts were deducted in computing Consolidated Net Income.
"CONSOLIDATED INDEBTEDNESS" shall mean, as at any date of
determination, without duplication, (x) the aggregate amount of all Indebtedness
of U.S. Borrower and its Subsidiaries less (y) cash and Cash Equivalents on hand
of U.S. Borrower and its Subsidiaries in excess of $2.0 million other than
restricted cash that is not held in a Collateral Account, determined on a
consolidated basis in accordance with GAAP.
"CONSOLIDATED INTEREST COVERAGE RATIO" shall mean, for any Test Period,
the ratio of (x) Consolidated EBITDA for such Test Period to (y) Cash Interest
Expense for such Test Period.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, the total
consolidated interest expense (less interest income) of U.S. Borrower and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP PLUS, without duplication:
(a) imputed interest on Capital Lease Obligations of U.S. Borrower
and its Subsidiaries for such period;
(b) commissions, discounts and other fees and charges owed by U.S.
Borrower or any of its Subsidiaries with respect to letters of credit
securing financial obligations, bankers' acceptance financing and
receivables financings for such period;
(c) amortization of debt issuance costs, debt discount or premium
and other financing fees and expenses incurred by U.S. Borrower or any of
its Subsidiaries for such period;
(d) cash contributions to any employee stock ownership plan or
similar trust made by U.S. Borrower or any of its Subsidiaries to the
extent such contributions are used by such plan or trust to pay interest
or fees to any person (other than U.S. Borrower or a Wholly Owned
Subsidiary) in connection with Indebtedness incurred by such plan or trust
for such period;
(e) all interest paid or payable with respect to discontinued
operations of U.S. Borrower or any of its Subsidiaries for such period;
(f) the interest portion of any deferred payment obligations of
U.S. Borrower or any of its Subsidiaries for such period; and
(g) all interest on any Indebtedness of U.S. Borrower or any of
its Subsidiaries of the type described in clause (f) or (j) of the
definition of "Indebtedness" for such period;
PROVIDED that (A) to the extent directly related to the Transactions, debt
issuance costs, debt discount or premium and other financing fees and expenses
shall be excluded from the calculation of Consolidated Interest Expense and (B)
the amortization during such period of other capitalized financing costs shall
be excluded from the calculation of Consolidated Interest Expense; PROVIDED that
in the case of clause (B) the aggregate amount of amortization relating to such
capitalized financing costs deducted in calculating Consolidated Interest
Expense shall not exceed 5% of the aggregate amount of the financing giving rise
thereto.
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Consolidated Interest Expense shall be calculated on a Pro Forma Basis
(including any Pro Forma Cost Savings) to give effect to any Indebtedness
incurred, assumed or permanently repaid or extinguished during the relevant Test
Period in connection with the Acquisition, any Permitted Acquisitions, each
Permitted Sale and Leaseback Transaction and other Asset Sales for consideration
individually or in the aggregate in excess of $3.0 million during any Test
Period as if such incurrence, assumption, repayment or extinguishing had been
effected on the first day of such period.
"CONSOLIDATED NET INCOME" shall mean, for any period, the consolidated
net income (or loss) of U.S. Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP; PROVIDED that there shall be
excluded from such net income (to the extent otherwise included therein),
without duplication:
(a) the net income (or loss) of any person (other than a
Subsidiary of U.S. Borrower) in which any person other than U.S. Borrower
and its Subsidiaries has an ownership interest, except to the extent that
cash in an amount equal to any such income has actually been received by
U.S. Borrower or (subject to clause (b) below) any of its Subsidiaries
during such period;
(b) the net income of any Subsidiary of U.S. Borrower (other than
a Foreign Subsidiary or a U.S. Subsidiary Guarantor) during such period to
the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of that income is not permitted by
operation of the terms of its Organizational Documents or any agreement
(other than any municipal loan or related agreements entered into in
connection with the incurrence of industrial or economic revenue bonds),
instrument, judgment, decree, order, statute, rule or regulation
applicable to that Subsidiary during such period, except that U.S.
Borrower's equity in net loss of any such Subsidiary for such period,
other than any non-cash loss that does not result in an accrual or reserve
for cash charges in any future period, shall be included in determining
Consolidated Net Income;
(c) any gain (or loss), together with any related provisions for
taxes on any such gain (or the tax effect of any such loss), realized
during such period by U.S. Borrower or any of its Subsidiaries upon (i)
any Asset Sale (other than any dispositions in the ordinary course of
business) by U.S. Borrower or any of its Subsidiaries, (ii) the
disposition of any Cash Equivalents or (iii) the repayment or cancellation
of any Indebtedness of U.S. Borrower or any of its Subsidiaries;
(d) gains and losses due solely to fluctuations in currency values
and the related tax effects determined in accordance with GAAP for such
period;
(e) earnings resulting from any reappraisal, revaluation or
write-up of assets;
(f) unrealized gains and losses with respect to Hedging
Obligations for such period;
(g) other than for purposes of the definition of Excess Cash Flow,
any extraordinary or nonrecurring gain (or extraordinary or nonrecurring
loss), together with any related provision for taxes on any such gain (or
the tax effect of any such loss), recorded or recognized by U.S. Borrower
or any of its Subsidiaries during such period; PROVIDED that such
nonrecurring losses shall not exceed $5.0 million in any Test Period;
(h) any expenses or reserves for liabilities to the extent that
the U.S. Borrower or any of its Subsidiaries is entitled to
indemnification therefore under binding agreements; PROVIDED that any
liabilities for which the U.S. Borrower or such Subsidiary is not actually
indemnified shall
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reduce Consolidated Net Income in the period in which it is determined
that the U.S. Borrower or such Subsidiary will not be indemnified; and
(i) the net income (or loss) of Thermal-Gard, Inc., so long as
U.S. Borrower is using commercially reasonable efforts to dispose of it or
discontinue its operations.
For purposes of this definition of "Consolidated Net Income,"
"NONRECURRING" means any gain or loss as of any date that is not reasonably
likely to recur within two years following such date; PROVIDED that if there was
a gain or loss similar to such gain or loss within the two years preceding such
date, such gain or loss shall not be deemed nonrecurring and (2) Consolidated
Net Income shall be reduced (to the extent not already reduced thereby) by the
amount of any payments to or on behalf of Parent made pursuant to SECTIONS
6.08(c) and (d).
"CONSOLIDATED SENIOR INDEBTEDNESS" shall mean, as at any date of
determination, the difference of Consolidated Indebtedness on such date less the
aggregate amount of all Subordinated Indebtedness of the Borrowers and the
Subsidiary Guarantors determined on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED TAX EXPENSE" shall mean, for any period, the tax expense
of U.S. Borrower and its Subsidiaries, for such period, determined on a
consolidated basis in accordance with GAAP.
"CONTESTED COLLATERAL LIEN CONDITIONS" shall mean, with respect to any
Permitted Lien of the type described in clauses (a), (b), (e) and (f) of SECTION
6.02, the following conditions:
(a) any proceeding instituted contesting such Lien shall operate
to stay the sale or forfeiture of any portion of the Collateral on account
of such Lien;
(b) to the extent such Lien is in an amount in excess of
$1,000,000, the appropriate Loan Party shall maintain cash reserves in
accordance with GAAP; and
(c) such Lien shall in all respects be subject and subordinate in
priority to the Lien and security interest created and evidenced by the
Security Documents, except if and to the extent that the law or regulation
creating, permitting or authorizing such Lien provides that such Lien is
or must be superior to the Lien and security interest created and
evidenced by the Security Documents.
"CONTINGENT OBLIGATION" shall mean, as to any person, any obligation,
agreement, understanding or arrangement of such person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations ("PRIMARY
OBLIGATIONS") of any other person (the "PRIMARY OBLIGOR") in any manner, whether
directly or indirectly, including any obligation of such person, whether or not
contingent, (a) to purchase any such primary obligation or any property
constituting direct or indirect security therefor; (b) to advance or supply
funds (i) for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor; (c) to purchase
property, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation; (d) with respect to bankers' acceptances,
letters of credit and similar credit arrangements, until a reimbursement
obligation arises (which reimbursement obligation shall constitute
Indebtedness); or (e) otherwise to assure or hold harmless the holder of such
primary obligation against loss in respect thereof; PROVIDED, HOWEVER, that the
term "Contingent Obligation" shall not include endorsements of instruments for
deposit or collection in the ordinary course of business or any product
warranties. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the
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stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such person may be liable, whether singly or jointly,
pursuant to the terms of the instrument evidencing such Contingent Obligation)
or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such person is required to perform thereunder) as
determined by such person in good faith.
"CONTROL" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "CONTROLLING" and "CONTROLLED" shall have meanings
correlative thereto.
"CONTROL AGREEMENT" shall have the meaning assigned to such term in the
U.S. Security Agreement.
"CREDIT EXTENSION" shall mean, as the context may require, (i) the
making of a Loan by a Lender or (ii) the issuance of any Letter of Credit, or
the amendment, extension or renewal of any existing Letter of Credit, by the
Issuing Bank.
"DEBT ISSUANCE" shall mean the incurrence by Parent or any of its
Subsidiaries of any Indebtedness after the Closing Date (other than as permitted
by SECTION 6.01).
"DEBT SERVICE" shall mean, for any period, Cash Interest Expense for
such period plus scheduled principal amortization of all Indebtedness for such
period.
"DEFAULT" shall mean any event, occurrence or condition which is, or
upon notice, lapse of time or both would constitute, an Event of Default.
"DEFAULT RATE" shall have the meaning assigned to such term in SECTION
2.06(c).
"DISQUALIFIED CAPITAL STOCK" shall mean any Equity Interest which, by
its terms (or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event, (a) matures
(excluding any maturity as the result of an optional redemption by the issuer
thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder thereof, in whole or in
part, on or prior to the first anniversary of the Final Maturity Date, (b) is
convertible into or exchangeable (unless at the sole option of the issuer
thereof) for (i) debt securities or (ii) any Equity Interests referred to in (a)
above, in each case at any time on or prior to the first anniversary of the
Final Maturity Date, or (c) contains any repurchase obligation which may come
into effect prior to payment in full of all Obligations; PROVIDED, FURTHER,
HOWEVER, that any Equity Interests that would not constitute Disqualified
Capital Stock but for provisions thereof giving holders thereof (or the holders
of any security into or for which such Equity Interests is convertible,
exchangeable or exercisable) the right to require the issuer thereof to redeem
such Equity Interests upon the occurrence of a change in control or an asset
sale occurring prior to the first anniversary of the Final Maturity Date shall
not constitute Disqualified Capital Stock if such Equity Interests provide that
the issuer thereof will not redeem any such Equity Interests pursuant to such
provisions prior to the repayment in full of the Obligations.
"DIVIDEND" with respect to any person shall mean that such person has
declared or paid a dividend or returned any equity capital to the holders of its
Equity Interests or authorized or made any other distribution, payment or
delivery of property (other than Qualified Capital Stock of such person) or cash
to the holders of its Equity Interests as such, or redeemed, retired, purchased
or otherwise acquired, directly or indirectly, for consideration any of its
Equity Interests outstanding (or any options or warrants
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issued by such person with respect to its Equity Interests), or set aside any
funds for any of the foregoing purposes, or shall have permitted any of its
Subsidiaries to purchase or otherwise acquire for consideration any of the
Equity Interests of such person outstanding (or any options or warrants issued
by such person with respect to its Equity Interests). Without limiting the
foregoing, "Dividends" with respect to any person shall also include all
payments made or required to be made by such person with respect to any stock
appreciation rights, plans, equity incentive or achievement plans or any similar
plans or setting aside of any funds for the foregoing purposes.
"DOLLARS" or "$" shall mean lawful money of the United States.
"DOMESTIC SUBSIDIARY" shall mean any Subsidiary that is organized or
existing under the laws of the United States, any state thereof or the District
of Columbia.
"EMBARGOED PERSON" shall have the meaning assigned to such term in
SECTION 6.21.
"ENVIRONMENT" shall mean ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, natural resources, the workplace or as otherwise defined in
any Environmental Law.
"ENVIRONMENTAL CLAIM" shall mean any claim, notice, demand, order,
action, suit, proceeding or other communication alleging liability for
investigation, remediation, removal, cleanup, response, corrective action,
damages to natural resources, personal injury, property damage, fines, penalties
or other costs resulting from, related to or arising out of (i) the presence,
Release or threatened Release in or into the Environment of Hazardous Material
at any location or (ii) any violation of Environmental Law, and shall include
any claim seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from, related to or arising out of
the presence, Release or threatened Release of Hazardous Material or alleged
injury or threat of injury to health, safety or the Environment.
"ENVIRONMENTAL LAW" shall mean any and all applicable present and
future treaties, laws, statutes, ordinances, regulations, rules, decrees,
orders, judgments, consent orders, consent decrees, code or other binding
requirements, and the common law and judicial or agency interpretation, policy
or guidance, relating to protection of public health or the Environment, the
Release or threatened Release of Hazardous Material, natural resources or
natural resource damages, or occupational safety or health.
"ENVIRONMENTAL PERMIT" shall mean any permit, license, approval,
consent or other authorization required by or from a Governmental Authority
under Environmental Law.
"EQUIPMENT" shall have the meaning assigned to such term in the U.S.
Security Agreement.
"EQUITY FINANCING" shall mean the cash contribution of approximately
$136.7 million by Sponsor, its affiliates and certain members of U.S. Borrower's
management to Holdings in return for Equity Interests in Holdings, and the
contribution of such cash by Holdings to Parent in connection with the funding
of the Acquisition.
"EQUITY INTEREST" shall mean, with respect to any person, any and all
shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or nonvoting), of equity of such
person, including, if such person is a partnership, partnership interests
(whether general or limited) and any other interest or participation that
confers on a person the right to receive a share of the profits and losses of,
or distributions of property of, such partnership, whether out-
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standing on the date hereof or issued after the Closing Date, but excluding debt
securities convertible or exchangeable into such equity.
"EQUITY INVESTORS" shall mean Sponsor and one or more investors
reasonably satisfactory to the Administrative Agent and the Arrangers.
"EQUITY ISSUANCE" shall mean, without duplication, (i) any issuance or
sale by Parent or Holdings after the Closing Date of any Equity Interests in
Parent or Holdings (including any Equity Interests issued upon exercise of any
warrant or option), as applicable, or any warrants or options to purchase such
Equity Interests or (ii) any contribution to the capital of Parent or Holdings;
PROVIDED, HOWEVER, that an Equity Issuance shall not include (x) any Preferred
Stock Issuance or Debt Issuance, (y) any such sale or issuance by Holdings of
its Equity Interests (including its Equity Interests issued upon exercise of any
warrant or option or warrants or options to purchase its Equity Interests but
excluding Disqualified Capital Stock), in each case, to directors, officers or
employees of any Company and (z) any Excluded Issuance.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as the same may be amended from time to time.
"ERISA AFFILIATE" shall mean, with respect to any person, any trade or
business (whether or not incorporated) that, together with such person, is
treated as a single employer under Section 414(b) or (c) of the Code, or solely
for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as
a single employer under Section 414 of the Code.
"ERISA EVENT" shall mean (a) any "reportable event," as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan (other than an event for which the 30-day notice period is waived by
regulation); (b) the existence with respect to any Plan of an "accumulated
funding deficiency" (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived, the failure to make by its due date a required
installment under Section 412(m) of the Code with respect to any Plan or the
failure to make any required contribution to a Multiemployer Plan; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by any Company or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by any Company or any of its ERISA Affiliates from the PBGC or a
plan administrator of any notice relating to the intention to terminate any Plan
or Plans or to appoint a trustee to administer any Plan, or the occurrence of
any event or condition which could reasonably be expected to constitute grounds
under ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; (f) except as set forth on SCHEDULE 3.17, the incurrence
by any Company or any of its ERISA Affiliates of any liability with respect to
the withdrawal from any Plan or Multiemployer Plan; (g) except as set forth on
SCHEDULE 3.17, the receipt by any Company or its ERISA Affiliates of any notice
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; (h) the making of any amendment to any
Plan which could result in the imposition of a lien or the posting of a bond or
other security; and (i) the occurrence of a nonexempt prohibited transaction
(within the meaning of Section 4975 of the Code or Section 406 of ERISA) which
could reasonably be expected to result in liability to any Company.
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of Eurodollar
Loans.
"EURODOLLAR LOAN" shall mean any Eurodollar Revolving Loan or
Eurodollar Term Loan.
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"EURODOLLAR REVOLVING BORROWING" shall mean a Borrowing comprised of
Eurodollar Revolving Loans.
"EURODOLLAR REVOLVING LOAN" shall mean any Revolving Loan bearing
interest at a rate determined by reference to the Adjusted LIBOR Rate in
accordance with the provisions of ARTICLE II.
"EURODOLLAR TERM BORROWING" shall mean a Borrowing comprised of
Eurodollar Term Loans.
"EURODOLLAR TERM LOAN" shall mean any Term Loan bearing interest at a
rate determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of ARTICLE II.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
ARTICLE VIII.
"EXCESS AMOUNT" shall have the meaning assigned to such term in SECTION
2.10(h)(ii).
"EXCESS CASH FLOW" shall mean, for any Excess Cash Flow Period,
Consolidated EBITDA for such Excess Cash Flow Period, MINUS, without
duplication:
(a) Debt Service for such Excess Cash Flow Period actually paid
during such Excess Cash Flow Period;
(b) Capital Expenditures during such Excess Cash Flow Period
(excluding Capital Expenditures made in such Excess Cash Flow Period where
a certificate in the form contemplated by the following clause (c) was
previously delivered) that are paid in cash;
(c) (x) Capital Expenditures that U.S. Borrower or any of its
Subsidiaries shall, during such Excess Cash Flow Period, become obligated
to make but that are not made during such Excess Cash Flow Period;
PROVIDED that U.S. Borrower shall deliver a certificate to the
Administrative Agent not later than 90 days after the end of such Excess
Cash Flow Period, signed by a Responsible Officer of U.S. Borrower and
certifying that such Capital Expenditures will be made in the following
Excess Cash Flow Period or (y) the CapEx Carryforward Amount for such
Excess Cash Flow Period less the CapEx Carryforward Amount from the prior
Excess Cash Flow Period that is not used in such Excess Cash Flow Period;
(d) the aggregate amount of investments made in cash during such
period pursuant to SECTIONS 6.04(e), (i), (j), (k) and (m) (other than
investments made with Excluded Issuances);
(e) taxes of U.S. Borrower and its Subsidiaries that were paid in
cash during such Excess Cash Flow Period or will be paid within six months
after the end of such Excess Cash Flow Period and for which reserves have
been established;
(f) Permitted Tax Distributions that are paid during the
respective Excess Cash Flow Period or will be paid within six months after
the close of such Excess Cash Flow Period;
(g) the absolute value of the difference, if negative, of the
amount of Net Working Capital at the end of the prior Excess Cash Flow
Period over the amount of Net Working Capital at the end of such Excess
Cash Flow Period;
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(h) losses excluded from the calculation of Consolidated Net
Income by operation of clause (c) or (g) of the definition thereof that
are paid in cash during such Excess Cash Flow Period;
(i) to the extent added to determine Consolidated EBITDA, all
items that did not result from a cash payment to U.S. Borrower or any of
its Subsidiaries on a consolidated basis during such Excess Cash Flow
Period; and
(j) permanent repayments and prepayments of Indebtedness (other
than the Obligations) made by U.S. Borrower and its Subsidiaries during
such fiscal year to the extent funded with internally generated funds;
PROVIDED that any amount deducted pursuant of any of the foregoing clauses that
will be paid after the close of such Excess Cash Flow Period shall not be
deducted again in a subsequent Excess Cash Flow Period; PLUS, without
duplication:
(i) the difference, if positive, of the amount of Net Working
Capital at the end of the prior Excess Cash Flow Period over the amount of
Net Working Capital at the end of such Excess Cash Flow Period;
(ii) all proceeds received during such Excess Cash Flow Period of
any Indebtedness to the extent used to finance any Capital Expenditure
(other than Indebtedness under this Agreement to the extent there is no
corresponding deduction to Excess Cash Flow above in respect of the use of
such borrowings);
(iii) to the extent any permitted Capital Expenditures referred to
in (c) above do not occur in the Excess Cash Flow Period specified in the
certificate of U.S. Borrower provided pursuant to (c) above, such amounts
of Capital Expenditures that were not so made in the Excess Cash Flow
Period specified in such certificates;
(iv) any return of capital on or in respect of investments received
in cash during such period other than proceeds of an Asset Sale, which
investments were made pursuant to SECTION 6.04(e), (i), (j), (k) or (m)
(other than investments made from Excluded Issuances);
(v) income or gain excluded from the calculation of Consolidated
Net Income by operation of clause (c) or (g) of the definition thereof
that is realized in cash during such Excess Cash Flow Period (except to
the extent such gain is subject to SECTION 2.10);
(vi) if deducted in the computation of Consolidated EBITDA,
interest income; and
(vii) to the extent subtracted in determining Consolidated EBITDA,
all items that did not result from a cash payment by U.S. Borrower or any
of its Subsidiaries on a consolidated basis during such Excess Cash Flow
Period;
PROVIDED FURTHER that Excess Cash Flow for the fiscal year of U.S. Borrower
ending on December 31, 2004 shall be deemed to be Excess Cash Flow as calculated
above multiplied by 3/4.
"EXCESS CASH FLOW PERIOD" shall mean each fiscal year of U.S. Borrower.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
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"EXCLUDED ISSUANCE" shall mean an issuance and sale of Qualified
Capital Stock of Holdings to the Permitted Holders and any corresponding
issuance and sale of Qualified Capital Stock of Parent to Holdings financed with
the net proceeds thereof.
"EXCLUDED TAXES" shall mean, with respect to the Administrative Agent,
any Lender, the Issuing Bank or any other recipient (each a "RECIPIENT," and
collectively the "RECIPIENTS") of any payment to be made by or on account of any
obligation of either Borrower hereunder, (a) income or franchise taxes imposed
on (or measured by) its net income as a result of a present or former connection
between the Recipient and the jurisdiction of the Governmental Authority
imposing such tax or any political subdivision or taxing authority thereof or
therein (other than any such connection arising solely from the Recipient having
executed, delivered or performed its obligations or received a payment under, or
enforced, or otherwise in connection with, this Agreement or any other Loan
Document), (b) in the case of a Foreign Lender, any U.S. federal withholding
taxes that are attributable to such Foreign Lender's failure to comply with the
requirements of SECTION 2.15(e), (c) Taxes that are United States withholding
taxes imposed on amounts payable to such Lender at the time such Lender becomes
a party to this Agreement, except to the extent that such Lender's assignor (if
any) was entitled, immediately prior to such assignment, to receive additional
amounts or indemnification from either Borrower with respect to such withholding
taxes pursuant to SECTION 2.15 (or would have been so entitled had the
assignor's tax status (residence, etc.) immediately before such assignment been
the same as the assignee's tax status immediately after such assignment) and (d)
U.S. federal withholding taxes that are imposed as a result of an event
occurring after the Lender becomes a Lender other than a Change in Law or
regulation or interpretation thereof.
"EXECUTIVE ORDER" shall have the meaning assigned to such term in
SECTION 3.22.
"EXECUTIVE ORDERS" shall have the meaning assigned to such term in
SECTION 6.21.
"EXISTING LIEN" shall have the meaning assigned to such term in SECTION
6.02(c).
"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System of the United States arranged by federal funds brokers,
as published on the next succeeding Business Day by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for the day for such transactions received by
the Administrative Agent from three federal funds brokers of recognized standing
selected by it.
"FEE LETTER" shall mean the confidential Fee Letter, dated December 31,
2003, among Holdings, the Arrangers, UBS Loan Finance LLC, Deutsche Bank AG
Cayman Islands Branch, Canadian Imperial Bank of Commerce and ▇▇▇▇▇▇▇ ▇▇▇▇▇
Capital Corporation.
"FEES" shall mean the Commitment Fees, the Administrative Agent Fees,
the LC Participation Fees and the Fronting Fees.
"FINAL MATURITY DATE" shall mean the latest of the Revolving Maturity
Date and the Term Loan Maturity Date.
"FINANCIAL OFFICER" of any person shall mean the chief financial
officer, principal accounting officer, treasurer or controller of such person.
"FIRREA" shall mean the Federal Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.
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"FOREIGN LENDER" shall mean any Lender that is not, for United States
federal income tax purposes, (i) a citizen or resident of the United States,
(ii) a corporation or partnership or entity treated as a corporation or
partnership created or organized in or under the laws of the United States, or
any political subdivision thereof, (iii) an estate whose income is subject to
U.S. federal income taxation regardless of its source or (iv) a trust if a court
within the United States is able to exercise primary supervision over the
administration of such trust and one or more United States persons have the
authority to control all substantial decisions of such trust.
"FOREIGN PLAN" shall mean any employee benefit plan, program, policy,
arrangement or agreement maintained or contributed to by any Company with
respect to employees employed outside the United States.
"FOREIGN SUBSIDIARY" shall mean a Subsidiary that is organized under
the laws of a jurisdiction other than the United States or any state thereof or
the District of Columbia.
"FRONTING FEE" shall have the meaning assigned to such term in SECTION
2.05(c).
"GAAP" shall mean generally accepted accounting principles in the
United States applied on a consistent basis; PROVIDED that with respect to
Canadian Borrower and any Canadian Subsidiaries organized under the laws of
Canada or a province thereof, for purposes of Sections 3.13, 5.05, 5.07 and 5.09
"GAAP" shall mean generally accepted accounting principles in Canada applied on
a consistent basis.
"GOVERNMENTAL AUTHORITY" shall mean any federal, state, provincial,
local or foreign court, central bank or governmental agency, authority,
instrumentality or regulatory body or any subdivision thereof.
"GOVERNMENTAL REAL PROPERTY DISCLOSURE REQUIREMENTS" shall mean any
Requirement of Law of any Governmental Authority requiring notification of the
buyer, lessee, mortgagee, assignee or other transferee of any Real Property,
facility, establishment or business, or notification, registration or filing to
or with any Governmental Authority, in connection with the sale, lease,
mortgage, assignment or other transfer (including any transfer of control) of
any Real Property, facility, establishment or business, of the actual or
threatened presence or Release in or into the Environment, or the use, disposal
or handling of Hazardous Material on, at, under or near the Real Property,
facility, establishment or business to be sold, leased, mortgaged, assigned or
transferred.
"GUARANTEED OBLIGATIONS" shall mean the U.S. Guaranteed Obligations
and/or the Canadian Guaranteed Obligations, as applicable.
"GUARANTEES" shall mean the guarantees issued pursuant to ARTICLE VII
by Parent and the Subsidiary Guarantors.
"GUARANTORS" shall mean Parent and the Subsidiary Guarantors.
"HAZARDOUS MATERIALS" shall mean the following: hazardous substances;
hazardous wastes; polychlorinated biphenyls ("PCBs") or any substance or
compound containing PCBs; asbestos or any asbestos-containing materials in any
form or condition; radon or any other radioactive materials including any
source, special nuclear or by-product material; petroleum, crude oil or any
fraction thereof; and any other pollutant or contaminant or chemicals, wastes,
materials, compounds, constituents or substances, subject to regulation or which
can give rise to liability under any Environmental Laws.
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"HEDGING AGREEMENT" shall mean any swap, cap, collar, forward purchase
or similar agreements or arrangements dealing with interest rates, currency
exchange rates or commodity prices, either generally or under specific
contingencies.
"HEDGING OBLIGATIONS" shall mean obligations under or with respect to
Hedging Agreements.
"HOLDINGS" shall mean Ply Gem Investment Holdings, Inc. (formerly known
as CI Investment Holdings, Inc.), a Delaware corporation.
"HOLDINGS SUBORDINATED INDEBTEDNESS" shall mean Indebtedness of
Holdings owing to any Permitted Holder issued pursuant to the Subordinated Note
Purchase Agreement attached hereto as EXHIBIT R. "INDEBTEDNESS" of any person
shall mean, without duplication, (a) all obligations of such person for borrowed
money or advances; (b) all obligations of such person evidenced by bonds,
debentures, notes or similar instruments; (c) all obligations of such person
upon which interest charges are customarily paid or accrued; (d) all obligations
of such person under conditional sale or other title retention agreements
relating to property purchased by such person; (e) all obligations of such
person issued or assumed as the deferred purchase price of property or services
(excluding trade accounts payable and accrued obligations incurred in the
ordinary course of business on normal trade terms and not overdue by more than
90 days); (f) all Indebtedness of others secured by any Lien on property owned
or acquired by such person, whether or not the obligations secured thereby have
been assumed, but limited to the fair market value of such property; (g) all
Capital Lease Obligations, Purchase Money Obligations and synthetic lease
obligations of such person; (h) all Hedging Obligations to the extent required
to be reflected on a balance sheet of such person; (i) all obligations of such
person (not including any contingent obligations) for the reimbursement of any
obligor in respect of letters of credit, letters of guaranty, bankers'
acceptances and similar credit transactions; and (j) all Contingent Obligations
of such person in respect of Indebtedness or obligations of others of the kinds
referred to in clauses (a) through (i) above. The Indebtedness of any person
shall include the Indebtedness of any other entity (including any partnership in
which such person is a general partner) to the extent such person is liable
therefor as a result of such person's ownership interest in or other
relationship with such entity, except to the extent that terms of such
Indebtedness expressly provide that such person is not liable therefor.
"INDEMNIFIED TAXES" shall mean all Taxes other than Excluded Taxes.
"INDEMNITEE" shall have the meaning assigned to such term in SECTION
11.03(b).
"INFORMATION" shall have the meaning assigned to such term in SECTION
11.12.
"INSTALLMENT CONTRACT" shall have the meaning assigned to such term in
SECTION 5.13(a).
"INSURANCE POLICIES" shall mean the insurance policies and coverages
required to be maintained by each Loan Party which is an owner of Mortgaged
Property with respect to the applicable Mortgaged Property pursuant to SECTION
5.04 and all renewals and extensions thereof.
"INSURANCE REQUIREMENTS" shall mean, collectively, all provisions of
the Insurance Policies, all requirements of the issuer of any of the Insurance
Policies and all orders, rules, regulations and any other requirements of the
National Board of Fire Underwriters (or any other body exercising similar
functions) binding upon each Loan Party which is an owner of Mortgaged Property
and applicable to the Mortgaged Property or any use or condition thereof.
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"INTELLECTUAL PROPERTY" shall have the meaning assigned to such term in
SECTION 3.06(a).
"INTERCOMPANY NOTE" shall mean the U.S. Intercompany Note and the
Canadian Intercompany Note.
"INTEREST ELECTION REQUEST" shall mean a request by either Borrower to
convert or continue a Revolving Borrowing or Term Borrowing in accordance with
SECTION 2.08(b), substantially in the form of EXHIBIT E.
"INTEREST PAYMENT DATE" shall mean (a) with respect to any ABR Loan
(including Swingline Loans), the last Business Day of each March, June,
September and December to occur during any period in which such Loan is
outstanding, (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in
the case of a Eurodollar Loan with an Interest Period of more than three months'
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months' duration after the first day of such Interest Period,
(c) with respect to any Revolving Loan or Swingline Loan, the Revolving Maturity
Date or such earlier date on which the Revolving Commitments are terminated and
(d) with respect to any Term Loan, the Term Loan Maturity Date.
"INTEREST PERIOD" shall mean, with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months (or, if each affected Lender so agrees, nine months) thereafter, as
the applicable Borrower may elect; PROVIDED that (a) if any Interest Period
would end on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless such next succeeding
Business Day would fall in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day, and (b) any Interest Period
that commences on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the last calendar month of
such Interest Period) shall end on the last Business Day of the last calendar
month of such Interest Period. For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made and thereafter shall
be the effective date of the most recent conversion or continuation of such
Borrowing; PROVIDED, HOWEVER, that an Interest Period shall be limited to the
extent required under SECTION 2.03(e).
"INVESTMENTS" shall have the meaning assigned to such term in SECTION
6.04.
"IPO" shall mean the first underwritten public offering by Parent or
Holdings of its Equity Interests after the Closing Date pursuant to a
registration statement filed with the Securities and Exchange Commission in
accordance with the Securities Act.
"IPO ENTITY" shall mean whichever of Parent or Holdings effects an IPO.
"ISSUING BANK" shall mean, as the context may require, (a) UBS AG,
Stamford Branch, with respect to Letters of Credit issued by it; (b) any other
Lender that may become an Issuing Bank pursuant to SECTIONS 2.18(j) and (k) with
respect to Letters of Credit issued by such Lender; or (c) collectively, all of
the foregoing.
"JOINDER AGREEMENT" shall mean a joinder agreement substantially in the
form of EXHIBIT F.
"JOINT LEAD ARRANGERS" shall have the meaning assigned to such term in
the preamble hereto.
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"JUDGMENT CURRENCY" shall have the meaning assigned to such term in
SECTION 11.16.
"JUDGMENT CURRENCY CONVERSION DATE" shall have the meaning assigned to
such term in SECTION 11.16.
"LANDLORD ACCESS AGREEMENT" shall mean (x) with respect to a Real
Property located in the United States, a U.S. Landlord Access Agreement,
substantially in the form of EXHIBIT G-1 and (y) with respect to a Real Property
located in Canada, a Canadian Landlord Access Agreement, substantially in the
form of EXHIBIT G-2, or, in either case, a landlord access agreement in such
other form as may reasonably be acceptable to the Collateral Agent.
"LC COMMITMENT" shall mean the commitment of the Issuing Bank to issue
Letters of Credit pursuant to SECTION 2.18, as the same shall be reduced from
time to time pursuant to SECTION 2.07 or SECTION 2.18. The amount of the LC
Commitment shall initially be $35.0 million, but in no event exceed the
Revolving Commitments.
"LC DISBURSEMENT" shall mean a payment or disbursement made by the
Issuing Bank pursuant to a Letter of Credit.
"LC EXPOSURE" shall mean at any time the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time PLUS (b) the
aggregate principal amount of all Reimbursement Obligations outstanding at such
time; PROVIDED that for any purpose other than calculating a fee due under this
Agreement the amount in clause (a) will be reduced by the amount of industrial
or economic revenue bonds issued in connection with the Assumed Debt and held by
a remarketing agent or trustee for the benefit of the Collateral Agent. The LC
Exposure of any Revolving Lender at any time shall mean its Pro Rata Percentage
of the aggregate LC Exposure at such time.
"LC PARTICIPATION FEE" shall have the meaning assigned to such term in
SECTION 2.05(c).
"LC REQUEST" shall mean a request by U.S. Borrower in accordance with
the terms of SECTION 2.18(b) and substantially in the form of EXHIBIT H, or such
other form as shall be approved by the Administrative Agent.
"LC SUB-ACCOUNT" shall have the meaning assigned to such term in
SECTION 9.01(d).
"LEASES" shall mean any and all leases, subleases, tenancies, options,
concession agreements, rental agreements, occupancy agreements, franchise
agreements, access agreements and any other agreements (including all
amendments, extensions, replacements, renewals, modifications and/or guarantees
thereof), whether or not of record and whether now in existence or hereafter
entered into, affecting the use or occupancy of all or any portion of any Real
Property.
"LENDER ADDENDUM" shall mean with respect to any Lender on the Closing
Date, a lender addendum in the form of EXHIBIT I, to be executed and delivered
by such Lender on the Closing Date as provided in SECTION 11.14.
"LENDER AFFILIATE" shall mean with respect to any Lender that is a fund
that invests in bank loans, any other fund that invests in commercial loans and
is managed or advised by the same investment advisor as such Lender or by an
Affiliate of such advisor.
"LENDERS" shall mean the U.S. Lenders and the Canadian Term Loan
Lenders.
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"LETTER OF CREDIT" shall mean any (i) Standby Letter of Credit and (ii)
Commercial Letter of Credit, in each case, issued or to be issued by an Issuing
Bank for the account of U.S. Borrower pursuant to SECTION 2.18.
"LETTER OF CREDIT EXPIRATION DATE" shall mean the date which is fifteen
days prior to the Revolving Maturity Date.
"LIBOR RATE" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period therefor, the rate per annum determined by the
Administrative Agent to be the arithmetic mean (rounded to the nearest 1/100th
of 1%) of the offered rates for deposits in dollars with a term comparable to
such Interest Period that appears on the Telerate British Bankers Assoc.
Interest Settlement Rates Page (as defined below) at approximately 11:00 a.m.,
London, England time, on the second full Business Day preceding the first day of
such Interest Period; PROVIDED, HOWEVER, that (i) if no comparable term for an
Interest Period is available, the LIBOR Rate shall be determined using the
weighted average of the offered rates for the two terms most nearly
corresponding to such Interest Period and (ii) if there shall at any time no
longer exist a Telerate British Bankers Assoc. Interest Settlement Rates Page,
"LIBOR Rate" shall mean, with respect to each day during each Interest Period
pertaining to Eurodollar Borrowings comprising part of the same Borrowing, the
rate per annum equal to the rate at which the Administrative Agent is offered
deposits in dollars at approximately 11:00 a.m., London, England time, two
Business Days prior to the first day of such Interest Period in the London
interbank market for delivery on the first day of such Interest Period for the
number of days comprised therein and in an amount comparable to its portion of
the amount of such Eurodollar Borrowing to be outstanding during such Interest
Period. "TELERATE BRITISH BANKERS ASSOC. INTEREST SETTLEMENT RATES PAGE" shall
mean the display designated as Page 3750 on the Telerate System Incorporated
Service (or such other page as may replace such page on such service for the
purpose of displaying the rates at which dollar deposits are offered by leading
banks in the London interbank deposit market).
"LIEN" shall mean, with respect to any property, (a) any mortgage, deed
of trust, lien, pledge, encumbrance, claim, charge, assignment, hypothecation,
security interest or encumbrance of any kind or any arrangement to provide
priority or preference or any filing of any financing statement under the UCC or
any other similar notice of Lien under any similar notice or recording statute
of any Governmental Authority, including any easement, right-of-way or other
encumbrance on title to Real Property, in each of the foregoing cases whether
voluntary or imposed by law, and any agreement to give any of the foregoing; (b)
the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement (or any financing lease having
substantially the same economic effect as any of the foregoing) relating to such
property; and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.
"LOAN DOCUMENTS" shall mean this Agreement, each LC Request or
application, the Notes (if any), the Security Documents, each Permitted U.S.
Hedging Agreement, each Permitted Canadian Hedging Agreement and, solely for
purposes of SECTION 8.01(e) hereof, the Fee Letter.
"LOAN PARTIES" shall mean Parent, the Borrowers and the Subsidiary
Guarantors.
"LOANS" shall mean, as the context may require, a Revolving Loan, a
U.S. Term Loan, a Canadian Term Loan or a Swingline Loan (and shall include any
Loans contemplated by SECTION 11.02(e)).
"MARGIN STOCK" shall have the meaning assigned to such term in
Regulation U.
-24-
"MATERIAL ADVERSE EFFECT" shall mean (a) a material adverse effect on
the condition (financial or otherwise), business, operations, assets,
liabilities or prospects of Parent and its Subsidiaries, taken as a whole; (b)
material impairment of the ability of the Loan Parties to fully and timely
perform any of their obligations under any Loan Document; (c) material
impairment of the rights of or benefits or remedies available to the Lenders or
the Collateral Agent under any Loan Document; or (d) a material adverse effect
on the Liens in favor of the Collateral Agent (for its benefit and for the
benefit of the other Secured Parties) on the Collateral or the priority of such
Liens.
"MATERIAL INDEBTEDNESS" shall mean (a) the Indebtedness listed on
SCHEDULE 1.01(c) and (b) any other Indebtedness (other than the Loans and
Letters of Credit) or Hedging Obligations of Parent or any of its Subsidiaries
in an aggregate outstanding principal amount exceeding $10.0 million. For
purposes of determining Material Indebtedness, the "principal amount" in respect
of any Hedging Obligations of any Loan Party at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that such Loan Party
would be required to pay if the related Hedging Agreement were terminated at
such time.
"MAXIMUM RATE" shall have the meaning assigned to such term in SECTION
11.13. "MORTGAGE" shall mean an agreement, including, but not limited to, a
mortgage, deed of trust or any other document, creating and evidencing a Lien on
a Mortgaged Property, which (i) in the case of Real Property owned in fee by a
U.S. Loan Party, shall be substantially in the form of EXHIBIT J-1, (ii) in the
case of Real Property owned in fee by a Canadian Loan Party, shall be
substantially in the form of Exhibit J-2, and (iii) in the case of leased Real
Property, shall be substantially in the form of EXHIBIT J-3, or, in each case,
another form reasonably satisfactory to the Collateral Agent, and, in each case,
with such schedules and including such provisions as shall be necessary to
conform such document to applicable local or foreign law or as shall be
customary under applicable local or foreign law.
"MORTGAGED PROPERTY" shall mean (a) each Real Property identified on
SCHEDULE 1.01(d) hereto and (b) each Real Property, if any, which shall be
subject to a Mortgage delivered after the Closing Date pursuant to SECTION
5.10(d) or (e) or SECTION 5.13.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan within the meaning
of Section 4001(a)(3) or Section 3(37) of ERISA (a) to which any Company or any
ERISA Affiliate is then making or accruing an obligation to make contributions;
(b) to which any Company or any ERISA Affiliate has within the preceding five
plan years made contributions; or (c) with respect to which any Company could
incur liability.
"NET CASH PROCEEDS" shall mean:
(a) with respect to any Asset Sale (other than any issuance or
sale of Equity Interests), the cash proceeds received by Parent or any of
its Subsidiaries (including cash proceeds subsequently received (as and
when received by Parent or any of its Subsidiaries) in respect of non-cash
consideration initially received) net of (i) selling expenses (including
reasonable brokers' fees or commissions, legal, accounting and other
professional and transactional fees, transfer and similar taxes and U.S.
Borrower's good faith estimate of income taxes paid or payable in
connection with such sale); (ii) amounts provided as a reserve, in
accordance with GAAP, against (x) any liabilities under any
indemnification obligations associated with such Asset Sale or (y) any
other liabilities retained by Parent or any of its Subsidiaries associated
with the properties sold in such Asset Sale (PROVIDED that, to the extent
and at the time any such amounts are released from such reserve, such
amounts shall constitute Net Cash Proceeds); (iii) U.S. Borrower's good
faith estimate of payments required to be made with respect to unassumed
liabilities relating to
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the properties sold within 90 days of such Asset Sale (PROVIDED that, to
the extent such cash proceeds are not used to make payments in respect of
such unassumed liabilities within 90 days of such Asset Sale, such cash
proceeds shall constitute Net Cash Proceeds); and (iv) the principal
amount, premium or penalty, if any, interest and other amounts on any
Indebtedness for borrowed money which is secured by a Lien on the
properties sold in such Asset Sale (so long as such Lien was permitted to
encumber such properties under the Loan Documents at the time of such
sale) and which is repaid with such proceeds (other than any such
Indebtedness assumed by the purchaser of such properties);
(b) with respect to any Debt Issuance, any Equity Issuance or any
other issuance or sale of Equity Interests by Holdings or any of its
Subsidiaries, the cash proceeds thereof, net of customary fees,
commissions, costs and other expenses incurred in connection therewith;
and
(c) with respect to any Casualty Event, the cash insurance
proceeds, condemnation awards and other compensation received in respect
thereof, net of all reasonable costs and expenses incurred in connection
with the collection of such proceeds, awards or other compensation in
respect of such Casualty Event.
"NET WORKING CAPITAL" shall mean, at any time, Consolidated Current
Assets at such time minus Consolidated Current Liabilities at such time.
"NON-GUARANTOR SUBSIDIARY" shall mean each Subsidiary that is not a
Subsidiary Guarantor.
"NOTES" shall mean any notes evidencing the Term Loans, Revolving Loans
or Swingline Loans issued pursuant to this Agreement, if any, substantially in
the form of EXHIBIT K-1, K-2, K-3 or K-4.
"OBLIGATIONS" shall mean the Canadian Obligations and the U.S.
Obligations.
"OFAC" shall have the meaning assigned to such term in SECTION 3.22.
"OFFER TO REDEEM" shall have the meaning assigned to such term in
SECTION 2.10(j).
"OFFICERS' CERTIFICATE" shall mean a certificate executed by the
chairman of the Board of Directors (if an officer), the chief executive officer
or the president and one of the Financial Officers, each in his or her official
(and not individual) capacity.
"ORGANIZATIONAL DOCUMENTS" shall mean, with respect to any person, (i)
in the case of any corporation, the certificate of incorporation and by-laws (or
similar documents) of such person, (ii) in the case of any limited liability
company, the certificate of formation and operating agreement (or similar
documents) of such person, (iii) in the case of any limited partnership, the
certificate of formation and limited partnership agreement (or similar
documents) of such person, (iv) in the case of any general partnership, the
partnership agreement (or similar document) of such person and (v) in any other
case, the functional equivalent of the foregoing.
"OTHER LIST" shall have the meaning assigned to such term in SECTION
6.21.
"OTHER TAXES" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies (including all interest, fines, penalties and additions to tax and
related expenses with regard thereto) arising from any payment made or required
to
-26-
be made under any Loan Document or from the execution, delivery, registration or
enforcement of, or otherwise with respect to, any Loan Document.
"PARENT" shall have the meaning assigned to such term in the preamble
hereto.
"PARTICIPANT" shall have the meaning assigned to such term in SECTION
11.04(e).
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to
and defined in ERISA.
"PERFECTION CERTIFICATE" shall mean a certificate in the form of
EXHIBIT L-1 or any other form approved by the Collateral Agent, as the same
shall be supplemented from time to time by a Perfection Certificate Supplement
or otherwise.
"PERFECTION CERTIFICATE SUPPLEMENT" shall mean a certificate supplement
in the form of EXHIBIT L-2 or any other form approved by the Collateral Agent.
"PERMITTED ACQUISITION" shall mean any transaction or series of related
transactions for the direct or indirect (a) acquisition of all or substantially
all of the property of any person, or of any business or division of any person;
(b) acquisition of in excess of 50% of the Equity Interests of any person, and
otherwise causing such person to become a Subsidiary of such person; or (c)
merger or consolidation or any other combination with any person (other than (x)
among U.S. Borrower and/or its Subsidiaries as permitted by SECTIONS 6.05(c) and
(d) and (y) between Parent and Holdings in connection with an IPO), if each of
the following conditions is met:
(i) no Default then exists or would result therefrom;
(ii) after giving effect to such transaction on a Pro Forma Basis,
(A) U.S. Borrower shall be in compliance with all covenants set forth in
SECTION 6.10 as of the most recent Test Period (assuming, for purposes of
SECTION 6.10, that such transaction, and all other Permitted Acquisitions
consummated since the first day of the relevant Test Period for each of
the financial covenants set forth in SECTION 6.10 ending on or prior to
the date of such transaction, had occurred on the first day of such
relevant Test Period), and (B) unless expressly approved by the
Administrative Agent, the person or business to be acquired shall have
generated positive cash flow for the Test Period most recently ended prior
to the date of consummation of such acquisition;
(iii) no Company shall, in connection with any such transaction,
assume or remain liable with respect to any Indebtedness or other
liability (including any material tax or ERISA liability) of the related
seller or the business, person or properties acquired, except (A) to the
extent permitted under SECTION 6.01 and (B) obligations not constituting
Indebtedness incurred in the ordinary course of business and necessary or
desirable to the continued operation of the underlying properties, and any
other such liabilities or obligations not permitted to be assumed or
otherwise supported by any Company hereunder shall be paid in full or
released as to the business, persons or properties being so acquired on or
before the consummation of such acquisition;
(iv) the person or business to be acquired shall be, or shall be
engaged in, a business of the type that U.S. Borrower and its Subsidiaries
are permitted to be engaged in under SECTION 6.15 and the property
acquired in connection with any such transaction shall be made subject to
the Lien of the Security Documents to the extent required by SECTION 5.10
and shall be free and clear of any Liens, other than Permitted Collateral
Liens;
-27-
(v) the Board of Directors of the person to be acquired shall not
have indicated publicly its opposition to the consummation of such
acquisition (which opposition has not been publicly withdrawn);
(vi) all transactions in connection therewith shall be consummated
in accordance with all applicable laws of all applicable Governmental
Authorities;
(vii) with respect to any transaction involving Acquisition
Consideration of more than $10.0 million, unless the Administrative Agent
shall otherwise agree, U.S. Borrower shall have provided the
Administrative Agent and the Lenders with (A) historical financial
statements for the last three fiscal years (or, if less, the number of
years since formation) of the person or business to be acquired (audited
if available and, in the case of a transaction involving Acquisition
Consideration of more than $20.0 million, if available without undue cost
or delay) and unaudited financial statements thereof for the most recent
interim period which are available, (B) reasonably detailed projections
for the succeeding five years pertaining to the person or business to be
acquired and updated projections for U.S. Borrower after giving effect to
such transaction, (C) a reasonably detailed description of all material
information relating thereto and copies of all material documentation
pertaining to such transaction, and (D) all such other information and
data relating to such transaction or the person or business to be acquired
as may be reasonably requested by the Administrative Agent or the Required
Lenders; and
(viii) at least 5 Business Days prior to the proposed date of
consummation of the transaction, U.S. Borrower shall have delivered to the
Agents and the Lenders an Officers' Certificate certifying that (A) such
transaction complies with this definition (which shall have attached
thereto reasonably detailed backup data and calculations showing such
compliance), and (B) such transaction could not reasonably be expected to
result in a Material Adverse Effect.
"PERMITTED CANADIAN HEDGING AGREEMENT" shall have the meaning assigned
to such term in the definition of "Canadian Obligations."
"PERMITTED COLLATERAL LIENS" means (i) Contested Liens (as defined in
the Security Agreement), (ii) the Liens described in clauses (a), (b), (c), (d),
(e), (f), (g), (h), (i), (j), (k), (m) and (n) of SECTION 6.02 and (iii) in the
case of Mortgaged Property, "Permitted Collateral Liens" shall mean the Liens
described in clauses (a), (b), (c), (d), (e), (g), (k) and (n) of SECTION 6.02;
PROVIDED, HOWEVER upon the Closing Date or upon the date of delivery of each
additional Mortgage under SECTION 5.10, 5.11 or 5.13, Permitted Collateral Liens
shall mean only those Liens set forth in Schedule B to the applicable Mortgage.
"PERMITTED HOLDERS" shall mean (1) Sponsor, Caxton Associates, LLC,
▇▇▇▇▇▇-▇▇▇▇▇▇ (Ply Gem) L.P., ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and any other person that is a controlled Affiliate of any
of the foregoing and (2) any Related Party of any of the foregoing; PROVIDED
that in no event shall any operating portfolio company or any holding company
for any operating portfolio company (other than U.S. Borrower) be a Permitted
Holder.
"PERMITTED LIENS" shall have the meaning assigned to such term in
SECTION 6.02.
"PERMITTED SALE AND LEASEBACK TRANSACTION" means a refinancing by U.S.
Borrower or its Subsidiaries (other than Canadian Borrower or any Canadian
Subsidiary) following the Closing Date of all or a portion of the Assumed Debt
with the proceeds of one or more Sale and Leaseback Transactions effected as
operating leases involving the applicable properties securing the Assumed Debt;
PRO-
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VIDED that (i) at the time of and immediately after giving effect to such
Permitted Sale and Leaseback Transaction and the application of the proceeds
thereof, no Default shall have occurred and be continuing and (ii) the proceeds
of up to 525% of the aggregate operating lease payments in respect of such
Permitted Sale and Leaseback Transaction (such amount, the "PERMITTED SALE AND
LEASEBACK TRANSACTION AMOUNT") are used (x) first, to repay the applicable
Assumed Debt being so refinanced and (y) second, are applied in accordance with
Section 2.10(c) (it being understood that, to the extent a prepayment deposit is
required by the terms of the Assumed Debt, U.S. Borrower may use proceeds of
Revolving Loans to fund such prepayment deposit and use proceeds of the Sale and
Leaseback Transaction to repay such Revolving Loans without any Commitment
reduction).
"PERMITTED SALE AND LEASEBACK TRANSACTION AMOUNT" shall have the
meaning assigned to such term in the definition of "Permitted Sale and Leaseback
Transaction."
"PERMITTED TAX DISTRIBUTIONS" means payments, dividends or
distributions by U.S. Borrower to Holdings or Parent or Parent to Holdings in
order to pay consolidated or combined federal, state or local taxes not payable
directly by U.S. Borrower or its Subsidiaries which payments by U.S. Borrower
are not in excess of the tax liabilities that would have been payable by U.S.
Borrower and its Subsidiaries on a stand-alone basis.
"PERMITTED U.S. HEDGING AGREEMENT" shall have the meaning assigned to
such term in the definition of "U.S. Obligations." "PERSON" shall mean any
natural person, corporation, business trust, joint venture, association,
company, limited liability company, partnership or government, or any agency or
political subdivision thereof, in any case, whether acting in a personal,
fiduciary or other capacity.
"PLAN" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA which is maintained or contributed to by
any Company or its ERISA Affiliate or with respect to which any Company could
incur liability (including under Section 4069 of ERISA).
"PPSA" shall mean the Personal Property Security Act as in effect from
time to time (except as otherwise specified) in any applicable Province of
Canada.
"PREFERRED STOCK" shall mean, with respect to any person, any and all
preferred or preference Equity Interests (however designated) of such person
whether now outstanding or issued after the Closing Date.
"PREFERRED STOCK ISSUANCE" shall mean the issuance or sale by Holdings
or any of its Subsidiaries of any Preferred Stock after the Closing Date (other
than (x) as permitted by SECTION 6.01 or (y) any Excluded Issuance).
"PREMISES" shall have the meaning assigned thereto in the applicable
Mortgage.
"PRO FORMA BASIS" shall mean on a basis reasonably satisfactory to the
Administrative Agent.
"PRO FORMA COST SAVINGS" shall mean, with respect to any Test Period,
the reductions in costs that occurred during the Test Period that are (1)
directly attributable to an asset acquisition and calculated on a basis that is
consistent with Article 11 of Regulation S-X or (2) implemented, committed to be
implemented or the commencement of implementation of which has begun in good
faith by the busi-
-29-
ness that was the subject of any such asset acquisition within six months of the
date of the asset acquisition and that are supportable and quantifiable by the
underlying records of such business, as if, in the case of each of clauses (1)
and (2), all such reductions in costs had been effected as of the beginning of
such period, decreased by any incremental expenses incurred or to be incurred
during the Test Period in order to achieve such reduction in costs.
"PRO RATA PERCENTAGE" of any Revolving Lender at any time shall mean
the percentage of the total Revolving Commitments of all Revolving Lenders
represented by such Lender's Revolving Commitment.
"PROPERTY" shall mean any right, title or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible and including Equity Interests or other ownership
interests of any person and whether now in existence or owned or hereafter
entered into or acquired, including all Real Property.
"PURCHASE MONEY OBLIGATION" shall mean, for any person, the obligations
of such person in respect of Indebtedness (including Capital Lease Obligations)
incurred for the purpose of financing all or any part of the purchase price of
any property (including Equity Interests of any person) or the cost of
installation, construction or improvement of any property and any refinancing
thereof; PROVIDED, HOWEVER, that (i) such Indebtedness is incurred within one
year after such acquisition of such property by such person and (ii) the amount
of such Indebtedness does not exceed 100% of the cost of such acquisition,
installation, construction or improvement, as the case may be.
"QUALIFIED CAPITAL STOCK" of any person shall mean any Equity Interests
of such person that are not Disqualified Capital Stock.
"REAL PROPERTY" shall mean, collectively, all right, title and interest
(including any leasehold estate) in and to any and all parcels of or interests
in real property owned, leased or operated by any person, whether by lease,
license or other means, together with, in each case, all easements,
hereditaments and appurtenances relating thereto, all improvements and
appurtenant fixtures and equipment, all general intangibles and contract rights
and other property and rights incidental to the ownership, lease or operation
thereof.
"REFINANCING" shall mean the repayment in full, and the termination of
any commitment to make extensions of credit in connection with, all of the
outstanding indebtedness of Parent or any of its Subsidiaries listed on SCHEDULE
1.01(e).
"REGISTER" shall have the meaning assigned to such term in SECTION
11.04(c).
"REGULATION D" shall mean Regulation D of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION S-X" shall mean Regulation S-X promulgated under the
Securities Act.
"REGULATION T" shall mean Regulation T of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
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"REGULATION X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REIMBURSEMENT OBLIGATIONS" shall mean U.S. Borrower's obligations
under SECTION 2.18(e) to reimburse LC Disbursements.
"RELATED PARTY" means, with respect to any person, (1) any controlling
stockholder, controlling member, general partner, Subsidiary, or spouse or
immediate family member (in the case of an individual), of such person, (2) any
estate, trust, corporation, partnership or other entity, the beneficiaries,
stockholders, partners or owners of which consist solely of one or more
Permitted Holders and/or such other persons referred to in the immediately
preceding clause (1), or (3) any executor, administrator, trustee, manager,
director or other similar fiduciary of any person referred to in the immediately
preceding clause (2), acting solely in such capacity.
"RELEASE" shall mean any spilling, leaking, seepage, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
disposing, depositing, dispersing, emanating or migrating of any Hazardous
Material in, into, onto or through the Environment.
"REQUIRED LENDERS" shall mean, at any time, Lenders having Loans, LC
Exposure and unused Revolving and Term Loan Commitments representing more than
50% of the sum of all Loans outstanding, LC Exposure and unused Revolving and
Term Loan Commitments at such time.
"REQUIREMENTS OF LAW" shall mean, collectively, any and all
requirements of any Governmental Authority including any and all laws,
ordinances, rules, regulations or similar statutes or case law.
"RESPONSE" shall mean (a) "response" as such term is defined in CERCLA,
42 U.S.C. section 9601(24), and (b) all other actions required by any
Governmental Authority or voluntarily undertaken to (i) clean up, remove, treat,
▇▇▇▇▇ or in any other way address any Hazardous Material in the environment;
(ii) prevent the Release or threat of Release, or minimize the further Release,
of any Hazardous Material; or (iii) perform studies and investigations in
connection with, or as a precondition to, clause (i) or (ii) above.
"RESPONSIBLE OFFICER" of any person shall mean any executive officer or
Financial Officer of such person and any other officer or similar official
thereof with responsibility for the administration of the obligations of such
person in respect of this Agreement.
"RESTRUCTURING EXPENSES" shall mean losses, expenses and charges
incurred in connection with restructuring by U.S. Borrower and/or one or more of
its Subsidiaries, including in connection with integration of acquired
businesses or persons, disposition of one or more Subsidiaries or businesses,
exiting of one or more lines of businesses and relocation or consolidation of
facilities, including severance, lease termination and other
non-ordinary-course, non-operating costs and expenses in connection therewith.
"REVOLVING AVAILABILITY PERIOD" shall mean the period from and
including the Closing Date to but excluding the earlier of (i) the Business Day
preceding the Revolving Maturity Date and (ii) the date of termination of the
Revolving Commitments.
"REVOLVING BORROWING" shall mean a Borrowing comprised of Revolving
Loans.
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"REVOLVING COMMITMENT" shall mean, with respect to each U.S. Lender,
the commitment, if any, of such U.S. Lender to make Revolving Loans hereunder up
to the amount set forth on Schedule I to the Lender Addendum executed and
delivered by such U.S. Lender or by an amendment to this Agreement pursuant to
SECTION 11.02(d), or in the Assignment and Assumption pursuant to which such
U.S. Lender assumed its Revolving Commitment, as applicable, as the same may be
(a) reduced from time to time pursuant to SECTION 2.07 and (b) reduced or
increased from time to time pursuant to assignments by or to such U.S. Lender
pursuant to SECTION 11.04. The aggregate amount of the Lenders' Revolving
Commitments on the Closing Date is $65.0 million.
"REVOLVING EXPOSURE" shall mean, with respect to any U.S. Lender at any
time, the aggregate principal amount at such time of all outstanding Revolving
Loans of such U.S. Lender, PLUS the aggregate amount at such time of such
Lender's LC Exposure, PLUS the aggregate amount at such of such Lender's
Swingline Exposure.
"REVOLVING LENDER" shall mean a U.S. Lender with a Revolving
Commitment.
"REVOLVING LOAN" shall mean a Loan made by the U.S. Lenders to U.S.
Borrower pursuant to SECTION 2.01(c). Each Revolving Loan shall either be an ABR
Revolving Loan or a Eurodollar Revolving Loan.
"REVOLVING MATURITY DATE" shall mean the date which is five years after
the Closing Date or, if such date is not a Business Day, the first Business Day
thereafter.
"ROLLOVER EQUITY" shall mean the phantom equity interest of certain
existing equityholders of Seller in Holdings valued at $4.3 million on terms and
conditions satisfactory to the Administrative Agent in its reasonable judgment.
"SALE AND LEASEBACK TRANSACTION" has the meaning assigned to such term
in SECTION 6.03.
"SDN LIST" shall have the meaning assigned to such term in SECTION
6.21.
"SECURED PARTIES" shall mean the U.S. Secured Parties and the Canadian
Secured Parties.
"SECURITIES ACT" shall mean the Securities Act of 1933.
"SECURITIES COLLATERAL" shall have the meaning assigned to such term in
the U.S. Security Agreement or the Canadian Security Agreement, as applicable.
"SECURITY AGREEMENT" shall mean the U.S. Security Agreement or the
Canadian Security Agreement, as applicable.
"SECURITY DOCUMENTS" shall mean the U.S. Security Documents and the
Canadian Security Documents.
"SELLER" shall have the meaning assigned to such term in the first
recital hereto.
"SENIOR LEVERAGE RATIO" shall mean, at any date of determination, the
ratio of Consolidated Senior Indebtedness on such date to Consolidated EBITDA
for the Test Period then most recently ended.
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"SENIOR SUBORDINATED NOTE AGREEMENT" shall mean any indenture, note
purchase agreement or other agreement pursuant to which the Senior Subordinated
Notes are issued as in effect on the date hereof and thereafter amended from
time to time subject to the requirements of this Agreement.
"SENIOR SUBORDINATED NOTE DOCUMENTS" shall mean the Senior Subordinated
Notes, the Senior Subordinated Note Agreement, the Senior Subordinated Note
Guarantees and all other documents executed and delivered with respect to the
Senior Subordinated Notes or the Senior Subordinated Note Agreement.
"SENIOR SUBORDINATED NOTE GUARANTEES" shall mean the guarantees of
Parent and the U.S. Subsidiary Guarantors pursuant to the Senior Subordinated
Note Agreement.
"SENIOR SUBORDINATED NOTES" shall mean U.S. Borrower's 9.0% Senior
Subordinated Notes due 2014 issued pursuant to the Senior Subordinated Note
Agreement and any registered notes issued by U.S. Borrower in exchange for, and
as contemplated by, such notes with substantially identical terms as such notes.
"SPONSOR" shall mean ▇▇▇▇▇▇-▇▇▇▇▇▇ Capital, Inc.
"STANDBY LETTER OF CREDIT" shall mean any standby letter of credit or
similar instrument issued for the purpose of supporting (a) workers'
compensation liabilities of U.S. Borrower or any of its Subsidiaries, (b) the
obligations of third-party insurers of U.S. Borrower or any of its Subsidiaries
arising by virtue of the laws of any jurisdiction requiring third-party insurers
to obtain such letters of credit, (c) performance, payment, deposit or surety
obligations of U.S. Borrower or any of its Subsidiaries if required by law or
governmental rule or regulation or in accordance with custom and practice in the
industry, (d) Indebtedness of U.S. Borrower or any of its Subsidiaries permitted
to be incurred under SECTION 6.01 or (e) any other purpose not prohibited
hereunder and acceptable to the Issuing Bank.
"STATUTORY RESERVES" shall mean for any Interest Period for any
Eurodollar Borrowing, the average maximum rate at which reserves (including any
marginal, supplemental or emergency reserves) are required to be maintained
during such Interest Period under Regulation D by member banks of the United
States Federal Reserve System in New York City with deposits exceeding one
billion dollars against "Eurodollar liabilities" (as such term is used in
Regulation D). Eurodollar Borrowings shall be deemed to constitute Eurodollar
liabilities and to be subject to such reserve requirements without benefit of or
credit for proration, exceptions or offsets which may be available from time to
time to any Lender under Regulation D.
"SUBORDINATED INDEBTEDNESS" shall mean Indebtedness of either Borrower
or any Guarantor that is by its terms subordinated in right of payment to the
Obligations of such Borrower and such Guarantor, as applicable, including the
Senior Subordinated Notes.
"SUBSIDIARY" shall mean, with respect to any person (the "PARENT") at
any date, (i) any person the accounts of which would be consolidated with those
of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date and
(ii) any other corporation, limited liability company, association or other
business entity of which securities or other ownership interests representing
more than 50% of the voting power of all Equity Interests entitled (without
regard to the occurrence of any contingency) to vote in the election of the
Board of Directors thereof are, as of such date, owned, controlled or held by
the parent and/or one or more subsidiaries of the parent. Unless the context
requires otherwise, "Subsidiary" refers to a Subsidiary of U.S. Borrower.
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"SUBSIDIARY GUARANTOR" shall mean each U.S. Subsidiary Guarantor and
each Canadian Subsidiary Guarantor.
"SUCCESSFUL SYNDICATION" shall have the meaning given to such term in
the Fee Letter.
"SURVEY" shall mean a survey of any Mortgaged Property (and all
improvements thereon) which is (a) (i) prepared by a surveyor or engineer
licensed to perform surveys in the jurisdiction where such Mortgaged Property is
located, (ii) dated (or redated) not earlier than six months prior to the date
of delivery thereof unless there shall have occurred within six months prior to
such date of delivery any exterior construction on the site of such Mortgaged
Property or any easement, right of way or other interest in the Mortgaged
Property has been granted or become effective through operation of law or
otherwise with respect to such Mortgaged Property which, in either case, can be
depicted on a survey, in which events, as applicable, such survey shall be dated
(or redated) after the completion of such construction or if such construction
shall not have been completed as of such date of delivery, not earlier than 20
days prior to such date of delivery, or after the grant or effectiveness of any
such easement, right of way or other interest in the Mortgaged Property, (iii)
certified by the surveyor (in a manner reasonably acceptable to the
Administrative Agent) to the Administrative Agent, the Collateral Agent and the
Title Company, (iv) complying in all respects with the minimum detail
requirements of the American Land Title Association as such requirements are in
effect on the date of preparation of such survey and (v) sufficient for the
Title Company to remove all standard survey exceptions from the title insurance
policy (or commitment) relating to such Mortgaged Property and issue the
endorsements of the type required by SECTION 4.01(o)(iii) or (b) otherwise
acceptable to the Collateral Agent.
"SWINGLINE COMMITMENT" shall mean the commitment of the Swingline
Lender to make loans pursuant to SECTION 2.17, as the same may be reduced from
time to time pursuant to SECTION 2.07 or SECTION 2.17. The amount of the
Swingline Commitment shall initially be $10.0 million, but in no event exceed
the Revolving Commitments.
"SWINGLINE EXPOSURE" shall mean at any time the aggregate principal
amount at such time of all outstanding Swingline Loans. The Swingline Exposure
of any Revolving Lender at any time shall equal its Pro Rata Percentage of the
aggregate Swingline Exposure at such time.
"SWINGLINE LENDER" shall have the meaning assigned to such term in the
preamble hereto.
"SWINGLINE LOAN" shall mean any loan made by the Swingline Lender
pursuant to SECTION 2.17.
"SYNDICATION AGENT" shall have the meaning assigned to such term in the
preamble hereto.
"TAX RETURN" shall mean all returns, statements, filings, attachments
and other documents or certifications required to be filed in respect of Taxes.
"TAXES" shall mean (i) any and all present or future taxes, duties,
levies, imposts, assessments, deductions, withholdings or other similar charges
imposed by the U.S. Internal Revenue Service or any other taxing authority
(whether domestic or foreign and including any federal, state, U.S. possession,
county, local, provincial or foreign government or any subdivision or taxing
agency thereof), whether computed on a separate, consolidated, unitary, combined
or other basis and any and all liabilities (including interest, fines, penalties
or additions to tax) with respect to the foregoing, and (ii) any transferee,
successor, joint and several, contractual or other liability (including
liability pursuant to Treasury Regulation
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Section 1.1502-6 (or any similar provision of state, local or non-U.S. law)) in
respect of any item described in clause (i).
"TERM BORROWING" shall mean a Borrowing comprised of Term Loans.
"TERM LOAN COMMITMENTS" shall mean the U.S. Term Loan Commitments and
the Canadian Term Loan Commitments.
"TERM LOAN LENDER" shall mean a Lender with a Term Loan Commitment or
an outstanding Term Loan.
"TERM LOAN MATURITY DATE" shall mean the date which is seven years
after the Closing Date or, if such date is not a Business Day, the first
Business Day thereafter.
"TERM LOAN REPAYMENT DATE" shall have the meaning assigned to such term
in SECTION 2.09(a).
"TERM LOANS" shall mean the U.S. Term Loans and the Canadian Term
Loans.
"TEST PERIOD" shall mean, at any time, the four consecutive fiscal
quarters of U.S. Borrower then last ended (in each case taken as one accounting
period) for which financial statements have been or are required to be delivered
pursuant to SECTION 5.01(a) or (b).
"TITLE COMPANY" shall mean any title insurance company as shall be
retained by U.S. Borrower and reasonably acceptable to the Administrative Agent.
"TITLE POLICY" shall have the meaning assigned to such term in SECTION
4.01(o)(iii).
"TOTAL LEVERAGE RATIO" shall mean, at any date of determination, the
ratio of Consolidated Indebtedness on such date to Consolidated EBITDA for the
Test Period then most recently ended.
"TRANSACTION DOCUMENTS" shall mean the Acquisition Documents, the
Senior Subordinated Note Documents and the Loan Documents.
"TRANSACTIONS" shall mean, collectively, the transactions to occur on
or prior to the Closing Date pursuant to the Transaction Documents, including
(a) the consummation of the Acquisition; (b) the execution, delivery and
performance of the Loan Documents and the initial borrowings hereunder; (c) the
Refinancing; (d) the Equity Financing; (e) the issuance of the Senior
Subordinated Notes; (f) the issuance of the Rollover Equity; and (g) the payment
of all fees and expenses to be paid on or prior to the Closing Date and owing in
connection with the foregoing.
"TRANSFERRED GUARANTOR" shall have the meaning assigned to such term in
SECTION 7.09.
"TYPE," when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBOR Rate or the
Alternate Base Rate.
"UCC" shall mean the Uniform Commercial Code as in effect from time to
time (except as otherwise specified) in any applicable state or jurisdiction.
"UNITED STATES" shall mean the United States of America.
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"U.S. BORROWER" shall have the meaning assigned to such term in the
preamble hereto.
"U.S. BORROWING REQUEST" shall mean a request by U.S. Borrower in
accordance with the terms of SECTION 2.03 and substantially in the form of
EXHIBIT C-1, or such other form as shall be approved by the Administrative
Agent.
"U.S. COLLATERAL ACCOUNT" shall mean a collateral account or
sub-account established and maintained by the Collateral Agent for the benefit
of the U.S. Secured Parties, in accordance with the provisions of SECTION 9.01.
"U.S. GUARANTEED OBLIGATIONS" shall have the meaning assigned to such
term in SECTION 7.01.
"U.S. GUARANTORS" shall have the meaning assigned to such term in
SECTION 7.01.
"U.S. INTERCOMPANY NOTE" shall mean a promissory note substantially in
the form of EXHIBIT P-1.
"U.S. LENDERS" shall mean (a) the financial institutions that have
become a party hereto pursuant to a Lender Addendum that make U.S. Loans or
provide Commitments to U.S. Borrower and (b) any financial institution that has
become a party hereto pursuant to an Assignment and Assumption that makes U.S.
Loans or provides a Commitment to U.S. Borrower, other than, in each case, any
such financial institution that has ceased to be a party hereto pursuant to an
Assignment and Assumption. Unless the context clearly indicates otherwise, the
term "U.S. Lenders" shall include the Swingline Lender.
"U.S. LOAN PARTIES" shall mean Parent, U.S. Borrower and the U.S.
Subsidiary Guarantors.
"U.S. LOANS" shall mean all Loans other than the Canadian Term Loans.
"U.S. MORTGAGED PROPERTY" shall mean the Mortgaged Properties owned or
leased by the U.S. Loan Parties.
"U.S. OBLIGATIONS" shall mean (a) obligations of U.S. Borrower and the
other U.S. Loan Parties from time to time arising (including by way of Article
VII) under or in respect of the due and punctual payment of (i) the principal of
and premium, if any, and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the U.S. Loans, when and as due, whether at maturity, by acceleration, upon one
or more dates set for prepayment or otherwise, (ii) each payment required to be
made by U.S. Borrower and the other U.S. Loan Parties under this Agreement in
respect of any Letter of Credit, when and as due, including payments in respect
of Reimbursement Obligations, interest thereon and obligations to provide cash
collateral and (iii) all other monetary obligations, including fees, costs,
expenses and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding), of U.S. Borrower and the other
U.S. Loan Parties under this Agreement and the other Loan Documents, (b) the due
and punctual performance of all covenants, agreements, obligations and
liabilities of U.S. Borrower and the other U.S. Loan Parties under or pursuant
to this Agreement and the other Loan Documents, (c) the due and punctual payment
and performance of all obligations of U.S. Borrower and the other U.S. Loan
Parties under each Hedging Agreement relating to either the U.S. Loans or
foreign currency exchange
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rates entered into with any counterparty that was a Lender or an Affiliate of a
Lender at the time such Hedging Agreement was entered into (provided that each
shall provide that it terminates or expires upon, or prior to, the repayment of
all Loans hereunder) (each, a "PERMITTED U.S. HEDGING AGREEMENT") and (d) the
due and punctual payment and performance of all obligations in respect of
overdrafts and related liabilities owed to any U.S. Lender, any Affiliate of a
U.S. Lender, the Administrative Agent or the Collateral Agent arising from
treasury, depositary and cash management services or in connection with any
automated clearinghouse transfer of funds, in each case, with respect to U.S.
Loans.
"U.S. SECURED PARTIES" shall mean, collectively, the Administrative
Agent, the Collateral Agent, each other Agent, the U.S. Lenders and each party
to a Permitted U.S. Hedging Agreement if such person executes and delivers to
the Administrative Agent a letter agreement in form and substance reasonably
acceptable to the Administrative Agent pursuant to which such person (i)
appoints the Collateral Agent as its agent under the applicable Loan Documents
and (ii) agrees to be bound by the provisions of SECTIONS 11.03 and 11.09.
"U.S. SECURITY AGREEMENT" shall mean a Security Agreement substantially
in the form of EXHIBIT M-1 among the U.S. Loan Parties and Collateral Agent for
the benefit of the Secured Parties.
"U.S. SECURITY AGREEMENT COLLATERAL" shall mean all property pledged or
granted as collateral pursuant to the U.S. Security Agreement delivered on the
Closing Date or thereafter pursuant to SECTION 5.10.
"U.S. SECURITY DOCUMENTS" shall mean the U.S. Security Agreement, the
Mortgages entered into by the U.S. Loan Parties and each other security document
or pledge agreement delivered in accordance with applicable local or foreign law
to grant a valid, perfected security interest in any property as collateral for
the Obligations, and all UCC or other financing statements or instruments of
perfection required by this Agreement, the U.S. Security Agreement, any Mortgage
or any other such security document or pledge agreement to be filed with respect
to the security interests in property and fixtures created pursuant to the U.S.
Security Agreement or any Mortgage and any other document or instrument utilized
to pledge as collateral for the Obligations any property.
"U.S. SUBSIDIARIES" shall mean all Subsidiaries of U.S. Borrower other
than Canadian Borrower and Canadian Subsidiaries.
"U.S. SUBSIDIARY GUARANTOR" shall mean each U.S. Subsidiary listed on
SCHEDULE 1.01(f), and each other U.S. Subsidiary that is or becomes a party to
this Agreement pursuant to SECTION 5.10.
"U.S. TERM LOAN" shall mean the term loans made by the U.S. Lenders to
U.S. Borrower pursuant to SECTION 2.01(a). Each U.S. Term Loan shall be either
an ABR Term Loan or a Eurodollar Term Loan.
"U.S. TERM LOAN COMMITMENT" shall mean, with respect to each U.S.
Lender, the commitment, if any, of such U.S. Lender to make a U.S. Term Loan
hereunder on the Closing Date in the amount set forth on Schedule I to the
Lender Addendum executed and delivered by such U.S. Lender. The aggregate amount
of the Lenders' U.S. Term Loan Commitments is $160.0 million.
"VOTING STOCK" shall mean, with respect to any person, any class or
classes of Equity Interests pursuant to which the holders thereof have the
general voting power under ordinary circumstances to elect at least a majority
of the Board of Directors of such person.
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"WHOLLY OWNED SUBSIDIARY" shall mean, as to any person, (a) any
corporation 100% of whose capital stock (other than directors' qualifying
shares) is at the time owned by such person and/or one or more Wholly Owned
Subsidiaries of such person and (b) any partnership, association, joint venture,
limited liability company or other entity in which such person and/or one or
more Wholly Owned Subsidiaries of such person have a 100% equity interest at
such time.
"WITHDRAWAL LIABILITY" shall mean liability to a Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 CLASSIFICATION OF LOANS AND BORROWINGS. For purposes
of this Agreement, Loans may be classified and referred to by Class (E.G., a
"REVOLVING LOAN") or by Type (E.G., a "EURODOLLAR LOAN") or by Class and Type
(E.G., a "EURODOLLAR REVOLVING LOAN"). Borrowings also may be classified and
referred to by Class (E.G., a "REVOLVING BORROWING," "BORROWING OF U.S. TERM
LOANS") or by Type (E.G., a "EURODOLLAR BORROWING") or by Class and Type (E.G.,
a "EURODOLLAR REVOLVING BORROWING").
SECTION 1.03 TERMS GENERALLY. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include," "includes" and
"including" shall be deemed to be followed by the phrase "without limitation."
The word "will" shall be construed to have the same meaning and effect as the
word "shall." Unless the context requires otherwise (a) any definition of or
reference to any Loan Document, agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any person shall be construed to include such
person's successors and assigns, (c) the words "herein," "hereof" and
"hereunder," and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof and (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, unless otherwise indicated.
SECTION 1.04 ACCOUNTING TERMS; GAAP. Except as otherwise expressly
provided herein, all financial statements to be delivered pursuant to this
Agreement shall be prepared in accordance with GAAP as in effect from time to
time and all terms of an accounting or financial nature shall be construed and
interpreted in accordance with GAAP, as in effect on the date hereof unless
otherwise agreed to by U.S. Borrower and the Required Lenders.
SECTION 1.05 RESOLUTION OF DRAFTING AMBIGUITIES. Each Loan Party
acknowledges and agrees that it was represented by counsel in connection with
the execution and delivery of the Loan Documents to which it is a party, that it
and its counsel reviewed and participated in the preparation and negotiation
hereof and thereof and that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation hereof or thereof.
ARTICLE II
THE CREDITS
SECTION 2.01 COMMITMENTS. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly:
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(a) to make a U.S. Term Loan to U.S. Borrower on the Closing Date
in the principal amount not to exceed its U.S. Term Loan Commitment; and
(b) to make a Canadian Term Loan to Canadian Borrower on the
Closing Date in the principal amount not to exceed its Canadian Term Loan
Commitment; and
(c) to make Revolving Loans to U.S. Borrower, at any time and from
time to time on or after the Closing Date until the earlier of the
Revolving Maturity Date and the termination of the Revolving Commitment of
such Lender in accordance with the terms hereof, in an aggregate principal
amount at any time outstanding that will not result in such Lender's
Revolving Exposure exceeding such Lender's Revolving Commitment; PROVIDED
that Borrower may only borrow $2.7 million of Revolving Loans on the
Closing Date.
Amounts paid or prepaid in respect of Term Loans may not be reborrowed.
Within the limits set forth in clause (b) above and subject to the terms,
conditions and limitations set forth herein, U.S. Borrower may borrow, pay or
prepay and reborrow Revolving Loans.
SECTION 2.02 LOANS. (a) Each Loan (other than Swingline Loans)
shall be made as part of a Borrowing consisting of Loans made by the Lenders
ratably in accordance with their applicable Commitments; PROVIDED that the
failure of any Lender to make any Loan shall not in itself relieve any other
Lender of its obligation to lend hereunder (it being understood, however, that
no Lender shall be responsible for the failure of any other Lender to make any
Loan required to be made by such other Lender). Except for Loans deemed made
pursuant to SECTION 2.18(e)(ii), (x) ABR Loans comprising any Borrowing shall be
in an aggregate principal amount that is (i) an integral multiple of $500,000
and not less than $2.5 million or (ii) equal to the remaining available balance
of the applicable Commitments and (y) the Eurodollar Loans comprising any
Borrowing shall be in an aggregate principal amount that is (i) an integral
multiple of $500,000 and not less than $2.5 million or (ii) equal to the
remaining available balance of the applicable Commitments.
(b) Subject to SECTIONS 2.11 and 2.12, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the applicable Borrower
may request pursuant to SECTION 2.03. Each Lender may at its option make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; PROVIDED that any exercise of such option shall not
affect the obligation of the applicable Borrower to repay such Loan in
accordance with the terms of this Agreement. Borrowings of more than one Type
may be outstanding at the same time; PROVIDED that the Borrowers shall not be
entitled to request any Borrowing that, if made, would result in more than ten
Eurodollar Borrowings outstanding hereunder at any one time. For purposes of the
foregoing, Borrowings having different Interest Periods, regardless of whether
they commence on the same date, shall be considered separate Borrowings.
(c) Except with respect to Loans made pursuant to SECTION
2.18(e)(ii), each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds to such
account in New York City as the Administrative Agent may designate not later
than 12:00 noon, New York City time, and the Administrative Agent shall promptly
credit the amounts so received to an account as directed by U.S. Borrower in the
applicable U.S. Borrowing Request maintained with the Administrative Agent or,
if a Borrowing shall not occur on such date because any condition precedent
herein specified shall not have been met, return the amounts so received to the
respective Lenders.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to 11:00 a.m. on the date of any Borrowing that such Lender
will not make available to the Administrative
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Agent such Lender's portion of such Borrowing, the Administrative Agent may
assume that such Lender has made such portion available to the Administrative
Agent on the date of such Borrowing in accordance with paragraph (c) above, and
the Administrative Agent may, in reliance upon such assumption, make available
to the applicable Borrower on such date a corresponding amount. If the
Administrative Agent shall have so made funds available, then, to the extent
that such Lender shall not have made such portion available to the
Administrative Agent, each of such Lender and such Borrower severally agrees 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 made
available to such Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of either Borrower, the interest rate
applicable at the time to the Loans comprising such Borrowing and (ii) in the
case of such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation. If such Lender shall repay to the Administrative
Agent such corresponding amount, such amount shall constitute such Lender's Loan
as part of such Borrowing for purposes of this Agreement, and such Borrower's
obligation to repay the Administrative Agent such corresponding amount pursuant
to this SECTION 2.02(d) shall cease.
(e) Notwithstanding any other provision of this Agreement, the
Borrowers shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Revolving Maturity Date or Term Loan Maturity Date, as applicable.
SECTION 2.03 BORROWING PROCEDURE. To request a Revolving Borrowing
or Term Borrowing, the applicable Borrower shall deliver, by hand delivery or
telecopy, a duly completed and executed Borrowing Request to the Administrative
Agent (i) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New
York City time, three Business Days before the date of the proposed Borrowing or
(ii) in the case of an ABR Borrowing, not later than 10:00 a.m., New York City
time, on the date of the proposed Borrowing. Each Borrowing Request shall be
irrevocable and shall specify the following information in compliance with
SECTION 2.02:
(a) whether the requested Borrowing is to be a Borrowing of
Revolving Loans, U.S. Term Loans or Canadian Term Loans;
(b) the aggregate amount of such Borrowing;
(c) the date of such Borrowing, which shall be a Business Day;
(d) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(e) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; PROVIDED that until the
earlier of (x) the date on which the Syndication Agent shall have notified
U.S. Borrower that a Successful Syndication has been achieved and (y) 60
days after the Closing Date, the Interest Period shall be seven days;
(f) the location and number of the applicable Borrower's account
to which funds are to be disbursed, which shall comply with the
requirements of SECTION 2.02(c); and
(g) that the conditions set forth in SECTIONS 4.02(b) THROUGH (d)
have been satisfied as of the date of the notice.
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If no election as to the Type of Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurodollar Revolving Borrowing, then the
applicable Borrower shall be deemed to have selected an Interest Period of one
month's duration (subject to the proviso in clause (e) above). Promptly
following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04 EVIDENCE OF DEBT; REPAYMENT OF LOANS. (a) U.S.
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each U.S. Term Loan Lender, the principal amount of each U.S.
Term Loan of such U.S. Term Loan Lender as provided in SECTION 2.09, (ii) to the
Administrative Agent for the account of each Revolving Lender, the then unpaid
principal amount of each Revolving Loan of such Revolving Lender on the
Revolving Maturity Date and (iii) to the Swingline Lender, the then unpaid
principal amount of each Swingline Loan on the earlier of the Revolving Maturity
Date and the first date after such Swingline Loan is made that is the 15th or
last day of a calendar month and is at least two Business Days after such
Swingline Loan is made; PROVIDED that on each date that a Revolving Borrowing is
made, U.S. Borrower shall repay all Swingline Loans that were outstanding on the
date such Borrowing was requested.
(b) Canadian Borrower hereby unconditionally promises to pay to
the Administrative Agent for the account of each Canadian Term Loan Lender, the
principal amount of each Canadian Term Loan of such Canadian Term Loan Lender as
provided in SECTION 2.09.
(c) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrowers to
such Lender resulting from each Loan made by such Lender from time to time,
including the amounts of principal and interest payable and paid to such Lender
from time to time under this Agreement.
(d) The Administrative Agent shall maintain accounts in which it
will record (i) the amount of each Loan made hereunder, the Type and Class
thereof and the Interest Period applicable thereto; (ii) the amount of any
principal or interest due and payable or to become due and payable from each
Borrower to each Lender hereunder; and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(e) The entries made in the accounts maintained pursuant to
paragraphs (c) and (d) above shall be PRIMA FACIE evidence of the existence and
amounts of the obligations therein recorded; PROVIDED that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligations of the Borrowers to repay
the Loans in accordance with their terms.
(f) Any Lender by written notice to the applicable Borrower (with
a copy to the Administrative Agent) may request that Loans of any Class made by
it be evidenced by a promissory note. In such event, the applicable Borrower
shall prepare, execute and deliver to such Lender a promissory note payable to
the order of such Lender (or, if requested by such Lender, to such Lender and
its registered assigns) in the form of EXHIBIT K-I, K-2, K-3 or K-4, as the case
may be. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to SECTION
11.04) be represented by one or more promissory notes in such form payable to
the order of the payee named therein (or, if such promissory note is a
registered note, to such payee and its registered assigns).
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SECTION 2.05 FEES.
(a) COMMITMENT FEE. Each Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee (a
"COMMITMENT FEE") equal to the Applicable Fee per annum on the average daily
unused amount of each Commitment of such Lender to such Borrower during the
period from and including the date hereof to but excluding the date on which
such Commitment terminates. Accrued Commitment Fees shall be payable in arrears
(A) on the last Business Day of March, June, September and December of each
year, commencing on the first such date to occur after the date hereof, and (B)
on the date on which such Commitment terminates. Commitment Fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). For
purposes of computing Commitment Fees with respect to Revolving Commitments, a
Revolving Commitment of a Lender shall be deemed to be used to the extent of the
outstanding Revolving Loans and LC Exposure of such Lender (and the Swingline
Exposure of such Lender shall be disregarded for such purpose).
(b) ADMINISTRATIVE AGENT FEES. U.S. Borrower agrees to pay to the
Administrative Agent, for its own account, the administrative fees set forth in
the Fee Letter or such other fees payable in the amounts and at the times
separately agreed upon between U.S. Borrower and the Administrative Agent (the
"ADMINISTRATIVE AGENT FEES").
(c) LC AND FRONTING FEES. U.S. Borrower agrees to pay (i) to the
Administrative Agent for the account of each Revolving Lender a participation
fee ("LC PARTICIPATION FEE") with respect to its participations in Letters of
Credit, which shall accrue at a rate equal to the Applicable Margin from time to
time used to determine the interest rate on Eurodollar Revolving Loans pursuant
to SECTION 2.06 on the average daily amount of such Lender's LC Exposure
(excluding any portion thereof attributable to Reimbursement Obligations) during
the period from and including the Closing Date to but excluding the later of the
date on which such Lender's Revolving Commitment terminates and the date on
which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee ("FRONTING FEE"), which shall accrue at the rate of 0.25% per annum
on the average daily amount of the LC Exposure (excluding any portion thereof
attributable to Reimbursement Obligations) during the period from and including
the Closing Date to but excluding the later of the date of termination of the
Revolving Commitments and the date on which there ceases to be any LC Exposure,
as well as the Issuing Bank's customary fees with respect to the issuance,
amendment, renewal or extension of any Letter of Credit or processing of
drawings thereunder. Accrued LC Participation Fees and Fronting Fees shall be
payable in arrears (i) on the last Business Day of March, June, September and
December of each year, commencing on the first such date to occur after the
Closing Date, and (ii) on the date on which the Revolving Commitments terminate.
Any such fees accruing after the date on which the Revolving Commitments
terminate shall be payable on demand. Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand
therefor. All LC Participation Fees and Fronting Fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).
(d) All Fees shall be paid on the dates due, in immediately
available funds, to the Administrative Agent for distribution, if and as
appropriate, among the Lenders, except that U.S. Borrower shall pay the Fronting
Fees directly to the Issuing Bank. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.06 INTEREST ON LOANS. (a) Subject to the provisions of
SECTION 2.06(c), the Loans comprising each ABR Borrowing, including each
Swingline Loan, shall bear interest at a rate per annum equal to the Alternate
Base Rate plus the Applicable Margin in effect from time to time.
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(b) Subject to the provisions of SECTION 2.06(c), the Loans
comprising each Eurodollar Borrowing shall bear interest at a rate per annum
equal to the Adjusted LIBOR Rate for the Interest Period in effect for such
Borrowing plus the Applicable Margin in effect from time to time.
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by either Borrower hereunder is
not paid when due, whether at stated maturity, upon acceleration or otherwise,
such overdue amount shall, to the extent permitted by applicable law, bear
interest, after as well as before judgment, at a rate per annum equal to (i) in
the case of overdue principal and premium, if any, of or interest on any Loan,
2% PLUS the rate otherwise applicable to such Loan as provided in the preceding
paragraphs of this SECTION 2.06 or (ii) in the case of any other amount, 2% PLUS
the rate applicable to ABR Revolving Loans as provided in SECTION 2.06(a) (in
either case, the "DEFAULT RATE").
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan; PROVIDED that (i) interest accrued
pursuant to SECTION 2.06(C) shall be payable on demand, (ii) in the event of any
repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving
Loan or a Swingline Loan), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment and (iii)
in the event of any conversion of any Eurodollar Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be payable
on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate shall be computed on the basis of a year of 365 days (or 366 days in a
leap year), and in each case shall be payable for the actual number of days
elapsed (including the first day but excluding the last day). The applicable
Alternate Base Rate or Adjusted LIBOR Rate shall be determined by the
Administrative Agent in accordance with the provisions of this Agreement and
such determination shall be conclusive absent manifest error.
(f) For purposes of the Interest Act (Canada), whenever interest
payable pursuant to this Agreement is calculated with respect to any monetary
Obligation relating to the Canadian Term Loans on the basis of a period other
than a calendar year (the "CALCULATION PERIOD"), each rate of interest
determined pursuant to such calculation expressed as an annual rate is
equivalent to such rate as so determined, MULTIPLIED by the actual number of
days in the calendar year in which the same is to be ascertained and DIVIDED by
the number of days in the Calculation Period.
(g) The principle of deemed reinvestment of interest with respect
to any monetary Obligation relating to the Canadian Term Loans shall not apply
to any interest calculation under this Agreement.
(h) The rates of interest with respect to any monetary Obligation
relating to the Canadian Term Loans stipulated in this Agreement are intended to
be nominal rates and not effective rates or yields.
SECTION 2.07 TERMINATION AND REDUCTION OF COMMITMENTS. (a) The
Term Loan Commitments shall automatically terminate at 5:00 p.m., New York City
time, on the Closing Date, The Revolving Commitments, the Swingline Commitment
and the LC Commitment shall automatically terminate on the Revolving Maturity
Date. Notwithstanding the foregoing, all the Commitments shall automatically
terminate at 5:00 p.m., New York City time, on March 31, 2004, if the initial
Credit Extension shall not have occurred by such time.
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(b) At its option, the applicable Borrower may at any time
terminate, or from time to time permanently reduce, the Commitments of any
Class; PROVIDED that (i) each reduction of the Commitments of any Class shall be
in an amount that is an integral multiple of $1.0 million and not less than $5.0
million and (ii) the Revolving Commitments shall not be terminated or reduced
if, after giving effect to any concurrent prepayment of the Revolving Loans in
accordance with SECTION 2.10, the aggregate amount of Revolving Exposures would
exceed the aggregate amount of Revolving Commitments.
(c) The applicable Borrower shall notify the Administrative Agent
in writing of any election to terminate or reduce the Commitments under SECTION
2.07(c) at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by a
Borrower pursuant to this Section shall be irrevocable; PROVIDED that a notice
of termination of the Commitments delivered by a Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities, in
which case such notice may be revoked by a Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments of
any Class shall be permanent. Each reduction of the Commitments of any Class
shall be made ratably among the Lenders in accordance with their respective
Commitments of such Class.
(d) The LC Commitment shall automatically be reduced on a dollar
for dollar basis by the face amount of letters of credit terminated in
connection with any Permitted Sale and Leaseback Transaction one Business Day
after the receipt of such proceeds; PROVIDED that the LC Commitment shall not be
reduced below $10.0 million pursuant to this SECTION 2.07(d).
SECTION 2.08 INTEREST ELECTIONS. (a) Each Revolving Borrowing and
Term Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an
initial Interest Period as specified in such Borrowing Request. Thereafter, the
applicable Borrower may elect to convert such Borrowing to a different Type or
to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrowers may
elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among the
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing. Notwithstanding
anything to the contrary, the Borrowers shall not be entitled to request any
conversion or continuation that, if made, would result in more than ten
Eurodollar Borrowings outstanding hereunder at any one time. This Section shall
not apply to Swingline Borrowings, which may not be converted or continued. Any
interest or conversion election pursuant to this Agreement does not constitute a
new Borrowing but simply an adjustment of the basis on which interest payable to
the applicable Lenders will be calculated.
(b) To make an election pursuant to this Section, the applicable
Borrower shall deliver, by hand delivery or telecopy, a duly completed and
executed Interest Election Request to the Administrative Agent not later than
the time that a Borrowing Request would be required under SECTION 2.03 if such
Borrower were requesting a Revolving Borrowing or Term Borrowing of the Type
resulting from such election to be made on the effective date of such election.
Each Interest Election Request shall be irrevocable.
(c) Each Interest Election Request shall specify the following
information in compliance with SECTION 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, or if outstanding Borrowings
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are being combined, allocation to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below
shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period"; PROVIDED that until the earlier of (x) the date on
which the Syndication Agent shall have notified U.S. Borrower that a
Successful Syndication has been achieved and (y) 60 days after the Closing
Date, the Interest Period shall be seven days.
If any such Interest Election Request requests a Eurodollar Borrowing
but does not specify an Interest Period, then the applicable Borrower shall be
deemed to have selected an Interest Period of one month's duration (subject to
the proviso in clause (iv) above).
(d) Promptly following receipt of an Interest Election Request,
the Administrative Agent shall advise each Lender of the details thereof and of
such Lender's portion of each resulting Borrowing.
(e) If an Interest Election Request with respect to a Eurodollar
Borrowing is not timely delivered prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing, the Administrative Agent or the Required Lenders
may require, by notice to U.S. Borrower, that (i) no outstanding Borrowing may
be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid,
each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of
the Interest Period applicable thereto.
SECTION 2.09 AMORTIZATION OF TERM BORROWINGS. (a) U.S. Borrower
shall pay to the Administrative Agent, for the account of the U.S. Lenders, on
the dates set forth on ANNEX II, or if any such date is not a Business Day, on
the immediately preceding Business Day (each such date, a "TERM LOAN REPAYMENT
DATE"), a principal amount of the U.S. Term Loans equal to the amount set forth
on ANNEX II for such date (as adjusted from time to time pursuant to SECTION
2.10(h)), together in each case with accrued and unpaid interest on the
principal amount to be paid to but excluding the date of such payment.
(b) Canadian Borrower shall pay to the Administrative Agent, for
the account of the Canadian Term Loan Lenders, on the Term Loan Repayment Dates,
a principal amount of the Canadian Term Loans equal to the amount set forth on
ANNEX II for such date (as adjusted from time to time pursuant to SECTION
2.10(H)), together in each case with accrued and unpaid interest on the
principal amount to be paid to but excluding the date of such payment.
(c) To the extent not previously paid, all Term Loans shall be due
and payable on the Term Loan Maturity Date.
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SECTION 2.10 OPTIONAL AND MANDATORY PREPAYMENTS OF LOANS AND
MANDATORY OFFERS TO REDEEM.
(a) OPTIONAL PREPAYMENTS. Each Borrower shall have the right at
any time and from time to time to prepay any Borrowing made by such Borrower, in
whole or in part, subject to the requirements of this SECTION 2.10; PROVIDED
that each partial prepayment shall be in an amount that is an integral multiple
of $500,000 and not less than $2.5 million.
(b) REVOLVING LOAN PREPAYMENTS. (i) In the event of the
termination of all the Revolving Commitments, U.S. Borrower shall, on the date
of such termination, repay or prepay all its outstanding Revolving Borrowings
and all outstanding Swingline Loans and replace all outstanding Letters of
Credit or cash collateralize all outstanding Letter of Credit in accordance with
the procedures set forth in SECTION 2.18(i).
(ii) In the event of any partial reduction of the Revolving
Commitments, then (x) at or prior to the effective date of such reduction, the
Administrative Agent shall notify U.S. Borrower and the Revolving Lenders of the
sum of the Revolving Exposures after giving effect thereto and (y) if the sum of
the Revolving Exposures would exceed the aggregate amount of Revolving
Commitments after giving effect to such reduction, then U.S. Borrower shall, on
the date of such reduction, FIRST, repay or prepay Swingline Loans, SECOND,
repay or prepay Revolving Borrowings and THIRD, replace outstanding Letters of
Credit or cash collateralize outstanding Letters of Credit in accordance with
the procedures set forth in SECTION 2.18(i), in an aggregate amount sufficient
to eliminate such excess.
(iii) In the event that the sum of all Lenders' Revolving Exposures
exceeds the Revolving Commitments then in effect, U.S. Borrower shall, without
notice or demand, immediately FIRST, repay or prepay Revolving Borrowings, and
SECOND, replace outstanding Letters of Credit or cash collateralize outstanding
Letters of Credit in accordance with the procedures set forth in SECTION
2.18(i), in an aggregate amount sufficient to eliminate such excess.
(iv) In the event that the aggregate LC Exposure exceeds the LC
Commitment then in effect, U.S. Borrower shall, without notice or demand,
immediately replace outstanding Letters of Credit or cash collateralize
outstanding Letters of Credit in accordance with the procedures set forth in
SECTION 2.18(i), in an aggregate amount sufficient to eliminate such excess.
(c) ASSET SALES. (I) Not later than three Business Days following
the receipt of any Net Cash Proceeds from a Permitted Sale and Leaseback
Transaction, U.S. Borrower shall utilize the portion of the Permitted Sale and
Leaseback Transaction Amount which has not been applied towards the prepayment
of the Assumed Debt being refinanced or the repayment of Revolving Loans made to
fund any prepayment deposit required by the terms of the Assumed Debt being
refinanced to make an Offer to Redeem, in accordance with SECTIONS 2.10(h), (i)
and (j), the maximum principal amount of Borrowings that may be redeemed by
applying an aggregate amount equal to 100% of the portion of the Permitted Sale
and Leaseback Transaction Amount not so applied.
(II) Not later than three Business Days following the receipt of
any Net Cash Proceeds from an Asset Sale pursuant to SECTION 6.06(h), U.S.
Borrower shall make an Offer to Redeem the maximum principal amount of
Borrowings that may be redeemed by applying an amount equal to 100% of such Net
Cash Proceeds to such Offer to Redeem in accordance with SECTIONS 2.10(h), (i)
and (j); PROVIDED that (x) notwithstanding anything to the contrary in SECTION
2.10(H) such amount shall first be applied to redeem the Canadian Term Loans on
behalf of the Canadian Borrower and (y) any such amount remaining after the
redemption in full of the Canadian Term Loans shall be applied in accordance
with SECTION 2.10(c)(III).
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(III) Not later than three Business Days following the receipt of
any Net Cash Proceeds of any Asset Sale (other than a Permitted Sale and
Leaseback Transaction or an Asset Sale pursuant to SECTION 6.06(h)) by Parent,
U.S. Borrower or any U.S. Subsidiary, U.S. Borrower shall make an Offer to
Redeem the maximum principal amount of Borrowings that may be redeemed by
applying an amount equal to 100% of such Net Cash Proceeds to make redemptions
in accordance with SECTIONS 2.10(h), (i) and (j); and not later than one
Business Day following the receipt of any Net Cash Proceeds of any Asset Sale by
Canadian Borrower or any Canadian Subsidiary, the Borrowers shall make an Offer
to Redeem the maximum principal amount of Borrowings that may be redeemed by
applying an amount equal to 100% of such Net Cash Proceeds to make redemptions
in accordance with SECTIONS 2.10(h), (i) and (j); PROVIDED, in each case, that:
(i) so long as no Default shall then exist or would arise
therefrom, no such Offer to Redeem shall be required under this SECTION
2.10(c)(III)(i) with respect to (A) any Asset Sale permitted by SECTION
6.06(a), (B) the disposition of property which constitutes a Casualty
Event, or (C) Asset Sales for fair market value resulting in no more than
$250,000 in Net Cash Proceeds per Asset Sale (or series of related Asset
Sales) and less than $1.5 million in Net Cash Proceeds in any fiscal year;
PROVIDED that clause (C) shall not apply in the case of any Asset Sale
described in clause (b) of the definition thereof or to an Asset Sale
pursuant to SECTION 6.06(h); and
(ii) so long as no Default shall then exist or would arise
therefrom and the aggregate of Net Cash Proceeds of Asset Sales shall not
exceed $20.0 million in any fiscal year of U.S. Borrower (not including
for purposes of this limit only, Net Cash Proceeds of Permitted Sale and
Leaseback Transactions or an Asset Sale pursuant to SECTION 6.06(h)), no
Offer to Redeem shall be required on such date to the extent that (A) U.S.
Borrower shall have delivered an Officers' Certificate to the
Administrative Agent on or prior to such date stating that such Net Cash
Proceeds are expected to be reinvested in fixed or capital assets within
365 days following the date of such Asset Sale (which Officers'
Certificate shall set forth the estimates of the proceeds to be so
expended); and (B) all Net Cash Proceeds in respect of all Asset Sales
(other than those referred to in clause (C) of SECTION 2.10(c)(III)(i) in
excess of $10.0 million in the aggregate at any time shall be held in the
applicable Collateral Account and released therefrom only in accordance
with the provisions of ARTICLE IX; PROVIDED that if all or any portion of
such Net Cash Proceeds is not so reinvested within such 365-day period,
such unused portion shall be applied to make an Offer to Redeem on the
last day of such period as provided in this SECTION 2.10(c)(III); and
PROVIDED, FURTHER, that if the property subject to such Asset Sale
constituted Collateral, then all property purchased with the Net Cash
Proceeds thereof pursuant to this subsection shall be made subject to the
Lien of the applicable Security Documents in favor of the Collateral
Agent, for its benefit and for the benefit of the other Secured Parties in
accordance with SECTIONS 5.10 and 5.11.
(d) DEBT ISSUANCE. Not later than one Business Day following the
receipt of any Net Cash Proceeds of any Debt Issuance by Parent, U.S. Borrower
or any of its U.S. Subsidiaries, U.S. Borrower shall make an Offer to Redeem the
maximum principal amount of Borrowings that may be redeemed by applying an
amount equal to 100% of such Net Cash Proceeds to make redemptions in accordance
with SECTIONS 2.10(h), (i) and (j). Not later than one Business Day following
the receipt of any Net Cash Proceeds of any Debt Issuance by Canadian Borrower
or any Canadian Subsidiary, the Borrowers, shall make an Offer to Redeem the
maximum principal amount of Borrowings that may be redeemed by applying an
amount equal to 100% of such Net Cash Proceeds to make redemptions in accordance
with SECTIONS 2.10(h), (i) and (j).
(e) EQUITY ISSUANCE OR PREFERRED STOCK ISSUANCE. Not later than
one Business Day following the receipt of any Net Cash Proceeds of any Equity
Issuance, U.S. Borrower shall apply an amount equal to 50% of such Net Cash
Proceeds to make prepayments in accordance with SEC-
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TIONS 2.10(h) and (i). Not later than one Business Day following the receipt of
any Net Cash Proceeds of any Preferred Stock Issuance by Holdings, Parent, U.S.
Borrower or any of its U.S. Subsidiaries, U.S. Borrower shall apply an amount
equal to 100% of such Net Cash Proceeds to make prepayments in accordance with
SECTIONS 2.10(h) and (i).
(f) CASUALTY EVENTS. Not later than one Business Day following the
receipt of any Net Cash Proceeds from a Casualty Event by Parent, U.S. Borrower
or any of its U.S. Subsidiaries, U.S. Borrower shall make an Offer to Redeem the
maximum principal amount of Borrowings that may be redeemed by applying an
amount equal to 100% of such Net Cash Proceeds to make redemptions in accordance
with SECTIONS 2.10(h), (i) and (j); and not later than one Business Day
following the receipt of any Net Cash Proceeds from a Casualty Event by Canadian
Borrower or any Canadian Subsidiary, the Borrowers, shall make an Offer to
Redeem the maximum principal amount of Borrowings that may be redeemed by
applying an amount equal to 100% of such Net Cash Proceeds to make redemptions
in accordance with SECTIONS 2.10(h), (i) and (j); PROVIDED, in each case, that:
(i) so long as no Default shall then exist or arise therefrom, no
Offer to Redeem shall be required on such date to the extent that U.S.
Borrower shall have delivered an Officers' Certificate to the
Administrative Agent on or prior to such date stating that such proceeds
are expected to be used to repair, replace or restore any property in
respect of which such Net Cash Proceeds were paid or to invest in other
fixed or capital assets, no later than 365 days (or such longer period as
may be approved by the Administrative Agent) following the date of receipt
of such proceeds; PROVIDED that if the property subject to such Casualty
Event constituted Collateral under the Security Documents, then all
property purchased with the Net Cash Proceeds thereof pursuant to this
subsection shall be made subject to the Lien of the applicable Security
Documents in favor of the Collateral Agent, for its benefit and for the
benefit of the other Secured Parties in accordance with SECTIONS 5.10 and
5.11;
(ii) all Net Cash Proceeds in respect of all Casualty Events in
excess of $10.0 million in the aggregate shall be held in the applicable
Collateral Account and released therefrom only in accordance with the
provisions of ARTICLE IX; and
(iii) if any portion of such Net Cash Proceeds shall not be so
applied within such 365-day (or longer) period, such unused portion shall
be applied to make an Offer to Redeem on the last day of such period as
provided in this SECTION 2.10(f).
(g) EXCESS CASH FLOW. No later than the earlier of (i) 90 days
after the end of each Excess Cash Flow Period and (ii) the date on which the
financial statements with respect to such fiscal year in which such Excess Cash
Flow Period occurs are delivered pursuant to SECTION 5.01(a), U.S. Borrower
shall make prepayments in accordance with SECTIONS 2.10(h) and (i) in an
aggregate amount equal to the excess of (x) 50% of Excess Cash Flow for the
Excess Cash Flow Period then ended less (y) any voluntary prepayments of Term
Loans and any permanent voluntary reductions to the Revolving Commitments to the
extent that an equal amount of the Revolving Loans simultaneously is repaid, in
each case so long as such amounts are not already reflected in Debt Service,
during such Excess Cash Flow Period; PROVIDED that only 25% of Excess Cash Flow
for the Excess Cash Flow Period then ended need be applied pursuant to this
SECTION 2.10(g) if the Senior Leverage Ratio is less than 1.5:1.0 as of the end
of such Excess Cash Flow Period.
(h) APPLICATION OF PREPAYMENTS AND REDEMPTIONS. (i) Prior to any
optional (subject to SECTION 2.10(a)) or mandatory prepayment or redemption
pursuant to any Offer to Redeem hereunder, the applicable Borrower shall select
the Borrowing or Borrowings to be prepaid or redeemed and shall specify such
selection in the notice of such prepayment or Offer to Redeem pursuant to
SECTION 2.10(i),
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subject to the provisions of this SECTION 2.10(h). Subject to SECTION
2.10(h)(iii), any prepayments or redemptions of Term Loans pursuant to SECTION
2.10(a), (c), (d), (e), (f) or (g) shall be applied to reduce scheduled
prepayments required under SECTIONS 2.09(a) and (b) on a PRO RATA basis among
the prepayments remaining to be made on each Term Loan Repayment Date and shall
be applied, in the case of prepayments or redemptions to be made solely by U.S.
Borrower, FIRST, to U.S. Term Loans and SECOND if all U.S. Term Loans have been
repaid, to Canadian Term Loans on behalf of Canadian Borrower, and, in the case
of prepayments or redemptions by the Borrowers, FIRST, by Canadian Borrower to
Canadian Term Loans and SECOND, if all Canadian Term Loans have been repaid, by
U.S. Borrower to U.S. Term Loans. After application of redemptions and mandatory
prepayments described above in this SECTION 2.10(h) and to the extent there are
redemption or mandatory prepayment amounts remaining after such application, the
Revolving Commitments shall be permanently reduced ratably among the Revolving
Lenders in accordance with their applicable Revolving Commitments in an
aggregate amount equal to such excess, and U.S. Borrower shall comply with
SECTION 2.10(b).
(ii) Amounts to be applied pursuant to this SECTION 2.10 to the
prepayment or redemption of Term Loans and Revolving Loans shall be applied, as
applicable, first to reduce outstanding ABR Term Loans and ABR Revolving Loans,
respectively. Any amounts remaining after each such application shall be applied
to prepay or redeem Eurodollar Term Loans or Eurodollar Revolving Loans, as
applicable. Notwithstanding the foregoing, if the amount of any prepayment of
Loans required under this SECTION 2.10 shall be in excess of the amount of the
ABR Loans at the time outstanding (an "EXCESS AMOUNT"), only the portion of the
amount of such prepayment or redemption as is equal to the amount of such
outstanding ABR Loans shall be immediately prepaid or redeemed and, at the
election of the applicable Borrower, the balance of such required prepayment
shall be either (A) deposited in the applicable Collateral Account and applied
to the prepayment or redemption of Eurodollar Loans on the last day of the then
next-expiring Interest Period for Eurodollar Loans; PROVIDED that (i) interest
in respect of such Excess Amount shall continue to accrue thereon at the rate
provided hereunder for the Loans which such Excess Amount is intended to repay
until such Excess Amount shall have been used in full to repay such Loans and
(ii) at any time while a Default has occurred and is continuing, the
Administrative Agent may, and upon written direction from the Required Lenders
shall, apply any or all proceeds then on deposit in either Collateral Account to
the payment of such Loans in an amount equal to such Excess Amount or (B)
prepaid immediately, together with any amounts owing to the Lenders under
SECTION 2.13.
(iii) Notwithstanding SECTIONS 2.10(e) and 2.10(g), the aggregate
amount of all prepayments by the Borrowers with respect to each Canadian Term
Loan pursuant to SECTIONS 2.10(e) and 2.10(g) and SECTION 2.09 as in effect on
the Closing Date within the first five years following the Closing Date shall
not exceed 25% of the initial principal amount of that Canadian Term Loan,
except for payments required as a result of an acceleration of the Obligations
of the Borrowers pursuant to ARTICLE VIII. For greater certainty and
notwithstanding any other provision of this Agreement, the failure of the
Borrowers to make any prepayment contemplated in SECTIONS 2.10(e) and 2.10(g) or
SECTION 2.09 solely as a consequence of the immediately preceding sentence shall
not constitute a Default.
(i) NOTICE OF PREPAYMENT OR OFFER TO REDEEM. The applicable
Borrower shall notify the Administrative Agent (and, in the case of prepayment
of a Swingline Loan, the Swingline Lender) by written notice of any prepayment
or Offer to Redeem hereunder (i) in the case of prepayment of a Eurodollar
Borrowing, not later than 11:00 a.m., New York City time, three Business Days
before the date of prepayment, (ii) in the case of prepayment of an ABR
Borrowing, not later than 11:00 a.m., New York City time, one Business Day
before the date of prepayment, (iii) in the case of prepayment of a Swingline
Loan, not later than 11:00 a.m., New York City time, on the date of prepayment
and (iv) in the case of an Offer to Redeem, five Business Days prior to the
proposed date of redemption. Each such notice shall be irrevocable; PROVIDED
that, if a notice of prepayment is given in connection with a conditional notice
of termination of the Commitments as contemplated by SECTION 2.07, then such
notice of prepayment may be
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revoked if such termination is revoked in accordance with SECTION 2.07. Each
such notice shall specify the prepayment or redemption date, the principal
amount of each Borrowing or portion thereof to be prepaid or redeemed and, in
the case of a mandatory prepayment or Offer to Redeem, a reasonably detailed
calculation of the amount of such prepayment. Promptly following receipt of any
such notice (other than a notice relating solely to Swingline Loans), the
Administrative Agent shall advise the Lenders of the contents thereof. Such
notice to the Lenders may be by electronic communication. Each partial
prepayment or Offer to Redeem of any Borrowing shall be in an amount that would
be permitted in the case of a Credit Extension of the same Type as provided in
SECTION 2.02, except as necessary to apply fully the required amount of a
mandatory prepayment. Each prepayment or Offer to Redeem of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing and otherwise in
accordance with this SECTION 2.10. Prepayments and Offers to Redeem shall be
accompanied by accrued interest to the extent required by SECTION 2.06. The
Administrative Agent shall advise the applicable Borrower if an Offer to Redeem
is accepted or declined by the Lenders on the Business Day prior to the proposed
redemption date. If an Offer to Redeem is declined all funds that were to be
used to redeem Borrowings shall revert to the applicable Borrower.
(j) MANDATORY OFFERS TO REDEEM. When required by SECTIONS 2.10(c),
(d) and (f), each Borrower shall make an offer to redeem Borrowings made by the
Borrowers in accordance with the terms of SECTION 2.10(i), which offer may be
accepted or declined by the Lenders in accordance with SECTION 11.02(e) (an
"OFFER TO REDEEM"). If any Offer to Redeem is accepted, all redemptions shall be
made in accordance with SECTION 2.10(h).
SECTION 2.11 ALTERNATE RATE OF INTEREST. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall
be final and conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Adjusted LIBOR Rate for
such Interest Period; or
(b) the Administrative Agent is advised in writing by the Required
Lenders that the Adjusted LIBOR Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest
Period;
then the Administrative Agent shall give written notice thereof to U.S. Borrower
and the Lenders as promptly as practicable thereafter and, until the
Administrative Agent notifies U.S. Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist (which the
Administrative Agent agrees to use its commercially reasonable efforts to do
promptly after it learns such circumstances cease to exist), (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
SECTION 2.12 INCREASED COSTS. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit
or similar requirement against property of, deposits with or for the
account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBOR Rate) or the Issuing Bank; or
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(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition or expense affecting this Agreement
or Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender, the
Issuing Bank or such Lender's or the Issuing Bank's holding company, if any, of
participating in, issuing or maintaining any Letter of Credit or to reduce the
amount of any sum received or receivable by such Lender or the Issuing Bank
hereunder (whether of principal, interest or otherwise), then the applicable
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank,
as the case may be, for such additional costs incurred or reduction suffered, it
being understood that, to the extent duplicative of the provisions of SECTION
2.15, this SECTION 2.12 shall not apply to Taxes.
(b) If any Lender or the Issuing Bank determines (in good faith, but in its sole
absolute discretion) that any Change in Law regarding capital requirements has
or would have the effect of reducing the rate of return on such Lender's or the
Issuing Bank's capital or on the capital of such Lender's or the Issuing Bank's
holding company, if any, as a consequence of this Agreement or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the Issuing Bank, to a level below that which such Lender or
the Issuing Bank or such Lender's or the Issuing Bank's holding company could
have achieved but for such Change in Law (taking into consideration such
Lender's or the Issuing Bank's policies and the policies of such Lender's or the
Issuing Bank's holding company with respect to capital adequacy), then from time
to time the applicable Borrower will pay to such Lender or the Issuing Bank, as
the case may be, such additional amount or amounts as will compensate such
Lender or the Issuing Bank or such Lender's or the Issuing Bank's holding
company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth in
reasonable detail the amount or amounts necessary to compensate such Lender or
the Issuing Bank or its holding company, as the case may be, as specified in
paragraph (a) or (b) of this SECTION 2.12 shall be delivered to the applicable
Borrower (with a copy to the Administrative Agent) and shall be conclusive and
binding absent manifest error. Such Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank
to demand compensation pursuant to this SECTION 2.12 shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such compensation;
PROVIDED that neither Borrower shall be required to compensate a Lender or the
Issuing Bank pursuant to this Section for any increased costs or reductions
incurred more than 180 days prior to the date that such Lender or the Issuing
Bank, as the case may be, notifies such Borrower of the Change in Law giving
rise to such increased costs or reductions and of such Lender's or the Issuing
Bank's intention to claim compensation therefor; PROVIDED, FURTHER, that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall not begin earlier than the date
of effectiveness of the Change in Law.
SECTION 2.13 BREAKAGE PAYMENTS. In the event of (a) the payment or
prepayment, whether optional or mandatory, of any principal of any Eurodollar
Loan earlier than the last day of an Interest Period applicable thereto
(including as a result of an Event of Default), (b) the conversion of any
Eurodollar Loan earlier than the last day of the Interest Period applicable
thereto, (c) the failure to borrow, convert, continue or prepay any Revolving
Loan or Term Loan on the date specified in any notice delivered pursuant hereto
or (d) the assignment of any Eurodollar Loan earlier than the last day of the
Interest Period applicable thereto as a result of a request by a Borrower
pursuant to SECTION 2.16, then, in
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any such event, such Borrower shall compensate each Lender for the loss (other
than lost profit or spread), cost and expense attributable to such event. In the
case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be
deemed to include an amount determined by such Lender to be the excess, if any,
of (i) the amount of interest which would have accrued on the principal amount
of such Loan had such event not occurred, at the Adjusted LIBOR Rate that would
have been applicable to such Loan, for the period from the date of such event to
the last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the Eurodollar
market. A certificate of any Lender setting forth in reasonable detail any
amount or amounts that such Lender is entitled to receive pursuant to this
SECTION 2.13 shall be delivered to the applicable Borrower (with a copy to the
Administrative Agent) and shall be conclusive and binding absent manifest error.
Such Borrower shall pay such Lender the amount shown as due on any such
certificate within 5 days after receipt thereof.
SECTION 2.14 PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SETOFFS. (a) Each Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest, fees
or Reimbursement Obligations, or of amounts payable under SECTION 2.12, 2.13 or
2.15, or otherwise) on or before the time expressly required hereunder or under
such other Loan Document for such payment (or, if no such time is expressly
required, prior to 2:00 p.m., New York City time), on the date when due, in
immediately available funds, without setoff, deduction or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, except payments to be made directly to the
Issuing Bank or Swingline Lender as expressly provided herein and except that
payments pursuant to SECTIONS 2.12, 2.13, 2.15 and 11.03 shall be made directly
to the persons entitled thereto and payments pursuant to other Loan Documents
shall be made to the persons specified therein. The Administrative Agent shall
distribute any such payments received by it for the account of any other person
to the appropriate recipient promptly following receipt thereof. If any payment
under any Loan Document shall be due on a day that is not a Business Day, unless
specified otherwise, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
under each Loan Document shall be made in dollars, except as expressly specified
otherwise.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
Reimbursement Obligations, interest and fees then due hereunder, such funds
shall be applied (i) FIRST, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) SECOND, towards
payment of principal and Reimbursement Obligations then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of principal
and Reimbursement Obligations then due to such parties.
(c) If any Lender shall, by exercising any right of setoff or
counterclaim or otherwise (including by exercise of its rights under SECTION 9.1
of the Security Agreement), obtain payment in respect of any principal of or
interest on any of its Revolving Loans, Term Loans or participations in LC
Disbursements or Swingline Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Revolving Loans, Term Loans
and participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans of other Lend-
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ers to the extent necessary so that the benefit of all such payments shall be
shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Revolving Loans, Term
Loans and participations in LC Disbursements and Swingline Loans; PROVIDED that
(i) if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be rescinded
and the purchase price restored to the extent of such recovery, without
interest, and (ii) the provisions of this paragraph shall not be construed to
apply to any payment made by either Borrower pursuant to and in accordance with
the express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or participations in LC Disbursements to any assignee or participant,
other than to U.S. Borrower or any of its Subsidiaries or Affiliates (as to
which the provisions of this paragraph shall apply). Each Loan Party consents to
the foregoing and agrees, to the extent it may effectively do so under
applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against such Loan Party rights of setoff and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of such Loan Party in the amount of such participation. If
under applicable bankruptcy, insolvency or any similar law any Secured Party
receives a secured claim in lieu of a setoff or counterclaim to which this
SECTION 2.14(c) applies, such Secured Party shall to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights to which the Secured Party is entitled under this SECTION 2.14(c) to
share in the benefits of the recovery of such secured claim.
(d) Unless the Administrative Agent shall have received notice
from the applicable Borrower prior to the date on which any payment is due to
the Administrative Agent for the account of the Lenders hereunder that such
Borrower will not make such payment, the Administrative Agent may assume that
such Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders the amount due. In
such event, if such Borrower has not in fact made such payment, then each of the
Lenders severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender with interest thereon, for each
day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be
made by it pursuant to SECTION 2.02(c), 2.14(d), 2.17(d), 2.18(d), 2.18(e) or
11.03(d), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.15 TAXES. (a) Any and all payments by or on account of
any obligation of either Borrower hereunder or under any other Loan Document
shall be made without setoff, counterclaim or other defense and free and clear
of and without deduction or withholding for any and all Indemnified Taxes;
PROVIDED that if either Borrower or any Secured Party shall be required by law
to deduct or pay any Indemnified Taxes from or in respect of such payments, then
(i) the sum payable shall be increased as necessary so that after making or
allowing for all required deductions and payments (including deductions,
withholdings or payments applicable to additional sums payable under this
SECTION 2.15) the Administrative Agent, any Lender or the Issuing Bank, as the
case may be, receives an amount equal to the sum it would have received had no
such deductions, withholdings or payments been required, (ii) such Borrower
shall make such deductions or withholdings, as are required to be made by it and
(iii) such Borrower shall pay the full amount deducted or withheld by it to the
relevant Governmental Authority in accordance with applicable law.
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(b) In addition, such Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) Each Borrower shall indemnify the Administrative Agent, each
Lender and the Issuing Bank, within 10 Business Days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent, such Lender or the Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of such
Borrower hereunder or under any other Loan Document, or otherwise with regard to
any Loan Document, (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this SECTION 2.15) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to either
Borrower by a Lender or the Issuing Bank, or by the Administrative Agent on its
own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive
absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes
or Other Taxes and in any event within 30 days of any such payment being due, by
either Borrower to a Governmental Authority, such Borrower shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.
(e) Each Foreign Lender shall deliver to the Borrowers and the
Administrative Agent two copies of either U.S. Internal Revenue Service Form
W-8BEN or Form W-8ECI, or, in the case of a Foreign Lender claiming exemption
from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments of "portfolio interest", a statement substantially in
the form of Exhibit Q and a Form W-8BEN, or any subsequent versions thereof or
successors thereto, properly completed and duly executed by such Foreign Lender
claiming complete exemption from, or a reduced rate of, U.S. federal withholding
tax on all payments by the Borrowers under this Agreement and the other Loan
Documents. Such forms shall be delivered by each Foreign Lender on or before the
date it becomes a party to this Agreement. In addition, each Foreign Lender
shall deliver such forms within ten (10) Business Days after receipt of a
written notification from the Borrowers that any form previously delivered by
such Foreign Lender is invalid or is due to expire or to become obsolete. Each
Foreign Lender shall promptly notify the Borrowers at any time it determines
that it is no longer in a position to provide any previously delivered
certificate to the Borrowers (or any other form of certification adopted by the
U.S. taxing authorities for such purpose). Notwithstanding any other provision
of this paragraph, a Foreign Lender shall not be required to deliver any form
pursuant to this paragraph that such Foreign Lender is not legally able to
deliver.
(f) If the Administrative Agent or a Lender determines in its
reasonable discretion that it is entitled to claim a refund of any Indemnified
Taxes or Other Taxes as to which it has been indemnified by a Borrower or with
respect to which a Borrower has paid additional amounts pursuant to this SECTION
2.15, it promptly shall notify the applicable Borrower of the availability of
such refund claim. Upon receipt of a written request from a Borrower, such
Administrative Agent or Lender shall use reasonable efforts to file a timely
claim to such taxation authority for such refund, solely at the Borrower's
expense. If the Administrative Agent or a Lender receives a refund (including
pursuant to a claim for refund made pursuant to the preceding sentence) or in
respect of any Indemnified Taxes or Other Taxes with respect to which a Borrower
has paid additional amounts pursuant to this SECTION 2.15, it shall within 30
days from the date of such receipt pay over the amount of such refund to the
applicable Borrower, net of all reasonable out-of-pocket expenses of such
Administrative Agent or Lender (as determined in the Administrative Agent's or
Lender's reasonable discretion) and without interest (other than interest paid
by the relevant taxation authority with respect to such refund); PROVIDED,
HOWEVER, that (i) each Borrower,
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upon the request of the Administrative Agent or such Lender (or assignee),
agrees to repay the amount paid over to such Borrower (PLUS any penalties,
interest or other charges (including Taxes) imposed by the relevant Governmental
Authority) to the Administrative Agent or such Lender (or assignee) within a
reasonable time (not to exceed 20 days) after receipt of written notice that the
Administrative Agent or such Lender (or assignee) is required to repay such
refund to such Governmental Authority and (ii) such Administrative Agent or
Lender shall not be required to make any payment under this SECTION 2.15(f) if
an Event of Default shall have occurred and be continuing. Nothing contained in
this SECTION 2.15(f) shall require the Administrative Agent or any Lender (or
assignee) to make available its Tax Returns or any other information which it
deems confidential to a Borrower or any other person. Notwithstanding anything
to the contrary, in no event will any Lender be required to pay any amount to a
Borrower the payment of which would place such Lender in a less favorable net
after-tax position than such Lender would have been in if the additional amounts
giving rise to such refund of any Indemnified Taxes had never been paid.
(g) The Administrative Agent and each Lender agrees, upon written
request from a Borrower, to use reasonable efforts (subject to overall policy
considerations of the Administrative Agent or such Lender, as the case may be,
and legal and regulatory restrictions) to avoid or minimize any amounts that
might otherwise be payable by a Borrower pursuant to this SECTION 2.15; provided
that such effort shall not impose on the Administrative Agent or any Lender any
additional costs or any other economic, legal, regulatory or other disadvantage,
as determined in the Administrative Agent's or such Lender's sole discretion;
provided, further, that nothing in this SECTION 2.15(g) shall affect or postpone
any of the obligations of a Borrower or the rights of any Administrative Agent
or Lender pursuant to this SECTION 2.15.
(h) The agreements in this Section shall survive the termination
of this Agreement and the payment of the Loans and all other amounts payable
hereunder.
SECTION 2.16 MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.
(a) MITIGATION OF OBLIGATIONS. If any Lender requests compensation
under SECTION 2.12, or if a Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to SECTION 2.15, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the reasonable judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to SECTION
2.12 or 2.15, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrowers, as applicable, hereby agree to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment. A certificate setting forth such costs and
expenses in reasonable detail submitted by such Lender to the Administrative
Agent shall be conclusive absent manifest error.
(b) REPLACEMENT OF LENDERS. If any Lender requests compensation
under SECTION 2.12, or if a Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to SECTION 2.15, or any Lender is a non-consenting Lender under Section
11.02(c), or if any Lender defaults in its obligation to fund Loans hereunder,
then the applicable Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 11.04), all of its interests, rights and obligations under
this Agreement to an assignee selected by such Borrower that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); PROVIDED that (i) such Borrower shall have
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received the prior written consent of the Administrative Agent (and, if a
Revolving Commitment is being assigned, the Issuing Bank and Swingline Lender),
which consents shall not unreasonably be withheld, (ii) such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans
and participations in LC Disbursements and Swingline Loans, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder (assuming
for this purpose that the Loans of such Lender were being prepaid) from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or such Borrower (in the case of all other amounts) and (iii) in the case
of any such assignment resulting from a claim for compensation under SECTION
2.12 or payments required to be made pursuant to SECTION 2.15, such assignment
will result in a material reduction in such compensation or payments. A Lender
shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling a Borrower to require such assignment and delegation cease to apply.
SECTION 2.17 SWINGLINE LOANS.
(a) SWINGLINE COMMITMENT. Subject to the terms and conditions set
forth herein, the Swingline Lender agrees to make Swingline Loans to U.S.
Borrower from time to time during the Revolving Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of outstanding Swingline Loans exceeding $10.0
million or (ii) the sum of the total Revolving Exposures exceeding the total
Revolving Commitments; PROVIDED that the Swingline Lender shall not be required
to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the
foregoing limits and subject to the terms and conditions set forth herein, U.S.
Borrower may borrow, repay and reborrow Swingline Loans.
(b) SWINGLINE LOANS. To request a Swingline Loan, U.S. Borrower
shall deliver, by hand delivery or telecopy, a duly completed and executed U.S.
Borrowing Request to the Administrative Agent and the Swingline Lender, not
later than 2:00 p.m., New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and the amount of the requested Swingline Loan.
Each Swingline Loan shall be an ABR Loan. The Swingline Lender shall make each
Swingline Loan available to U.S. Borrower by means of a credit to the general
deposit account of U.S. Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as
provided in SECTION 2.18(e), by remittance to the Issuing Bank) by 3:00 p.m.,
New York City time, on the requested date of such Swingline Loan. U.S. Borrower
shall not request a Swingline Loan if at the time of or immediately after giving
effect to the Extension of Credit contemplated by such request a Default has
occurred and is continuing or would result therefrom. Swingline Loans shall be
made in minimum amounts of $500,000 and integral multiples of $250,000 above
such amount.
(c) PREPAYMENT. U.S. Borrower shall have the right at any time and
from time to time to repay any Swingline Loan, in whole or in part, upon giving
written notice to the Swingline Lender and the Administrative Agent before 12:00
(noon), New York City time, on the proposed date of repayment.
(d) PARTICIPATIONS. The Swingline Lender may at any time in its
discretion by written notice given to the Administrative Agent (PROVIDED such
notice requirement shall not apply if the Swingline Lender and the
Administrative Agent are the same entity) not later than 11:00 A.M., New York
City time, on the next succeeding Business Day following such notice require the
Revolving Lenders to acquire participations on such Business Day in all or a
portion of the Swingline Loans then outstanding. Such notice shall specify the
aggregate amount of Swingline Loans in which Revolving Lenders will participate.
Promptly upon receipt of such notice, the Administrative Agent will give notice
thereof to each Revolving Lender, specifying in such notice such Lender's Pro
Rata Percentage of such Swingline Loan
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or Loans. Each Revolving Lender hereby absolutely and unconditionally agrees,
upon receipt of notice as provided above, to pay to the Administrative Agent,
for the account of the Swingline Lender, such Lender's Pro Rata Percentage of
such Swingline Loan or Loans. Each Revolving Lender acknowledges and agrees that
its obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever (so
long as such payment shall not cause such Lender's Revolving Exposure to exceed
such Lender's Revolving Commitment). Each Revolving Lender shall comply with its
obligation under this paragraph by wire transfer of immediately available funds,
in the same manner as provided in SECTION 2.02(c) with respect to Loans made by
such Lender (and SECTION 2.02 shall apply, MUTATIS MUTANDIS, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Revolving Lenders. The Administrative Agent shall notify U.S. Borrower of any
participations in any Swingline Loan acquired by the Revolving Lenders pursuant
to this paragraph, and thereafter payments in respect of such Swingline Loan
shall be made to the Administrative Agent and not to the Swingline Lender. Any
amounts received by the Swingline Lender from U.S. Borrower (or other party on
behalf of U.S. Borrower) in respect of a Swingline Loan after receipt by the
Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent. Any such amounts received by the
Administrative Agent shall be promptly remitted by the Administrative Agent to
the Revolving Lenders that shall have made their payments pursuant to this
paragraph, as their interests may appear. The purchase of participations in a
Swingline Loan pursuant to this paragraph shall not relieve U.S. Borrower of any
default in the payment thereof.
SECTION 2.18 LETTERS OF CREDIT
(a) GENERAL. Subject to the terms and conditions set forth herein,
U.S. Borrower may request the Issuing Bank, and the Issuing Bank agrees, to
issue Letters of Credit for its own account or the account of a Subsidiary in a
form reasonably acceptable to the Administrative Agent and the Issuing Bank, at
any time and from time to time during the Revolving Availability Period
(PROVIDED that U.S. Borrower shall be a co-applicant, and be jointly and
severally liable, with respect to each Letter of Credit issued for the account
of a Subsidiary). The Issuing Bank shall have no obligation to issue, and U.S.
Borrower shall not request the issuance of, any Letter of Credit at any time if
after giving effect to such issuance, the LC Exposure would exceed the LC
Commitment or the total Revolving Exposure would exceed the total Revolving
Commitments. In the event of any inconsistency between the terms and conditions
of this Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by U.S. Borrower to, or entered into by
U.S. Borrower with, the Issuing Bank relating to any Letter of Credit, the terms
and conditions of this Agreement shall control.
(b) REQUEST FOR ISSUANCE, AMENDMENT, RENEWAL, EXTENSION; CERTAIN
CONDITIONS. To request the issuance of a Letter of Credit or the amendment,
renewal or extension of an outstanding Letter of Credit, U.S. Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) an LC Request
to the Issuing Bank and the Administrative Agent not later than 11:00 a.m. on
the third Business Day preceding the requested date of issuance, amendment,
renewal or extension (or such later date and time as is acceptable to the
Issuing Bank).
A request for an initial issuance of a Letter of Credit shall specify
in form and detail satisfactory to the Issuing Bank:
(i) the proposed issuance date of the requested Letter of Credit
(which shall be a Business Day);
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(ii) the amount thereof;
(iii) the expiry date thereof (which shall not be later than the
close of business on the Letter of Credit Expiration Date);
(iv) the name and address of the beneficiary thereof;
(v) whether the Letter of Credit is to be issued for its own
account or for the account of one of its Subsidiaries (PROVIDED that U.S.
Borrower shall be a co-applicant, and therefore jointly and severally
liable, with respect to each Letter of Credit issued for the account of a
Subsidiary);
(vi) the documents to be presented by such beneficiary in
connection with any drawing thereunder;
(vii) the full text of any certificate to be presented by such
beneficiary in connection with any drawing thereunder; and
(viii) such other matters as the Issuing Bank may require.
A request for an amendment, renewal or extension of any outstanding
Letter of Credit shall specify in form and detail satisfactory to the Issuing
Bank:
(i) the Letter of Credit to be amended, renewed or extended;
(ii) the proposed date of amendment, renewal or extension thereof
(which shall be a Business Day);
(iii) the nature of the proposed amendment, renewal or extension;
and
(iv) such other matters as the Issuing Bank may require.
If requested by the Issuing Bank, U.S. Borrower also shall submit a letter of
credit application on the Issuing Bank's standard form in connection with any
request for a Letter of Credit. A Letter of Credit shall be issued, amended,
renewed or extended only if (and, upon issuance, amendment, renewal or extension
of each Letter of Credit, U.S. Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension,
(i) the LC Exposure shall not exceed the LC Commitment, (ii) the total Revolving
Exposures shall not exceed the total Revolving Commitments and (iii) the
conditions set forth in ARTICLE IV in respect of such issuance, amendment,
renewal or extension shall have been satisfied. Unless the Issuing Bank shall
agree otherwise, no Letter of Credit shall be in an initial amount less than
$100,000, in the case of a Commercial Letter of Credit, or $500,000, in the case
of a Standby Letter of Credit, or is to be denominated in a currency other than
Dollars.
(c) EXPIRATION DATE. Each Letter of Credit shall expire at or
prior to the close of business on the earlier of (i) in the case of a Standby
Letter of Credit, (x) the date which is no later than one year after the date of
the issuance of such Standby Letter of Credit (or, in the case of any renewal or
extension thereof, no later than one year after such renewal or extension) and
(y) the Letter of Credit Expiration Date and (ii) in the case of a Commercial
Letter of Credit, (x) the date that is no later than 180 days after the date of
issuance of such Commercial Letter of Credit (or, in the case of any renewal or
extension thereof, no later than 180 days after such renewal or extension) and
(y) the Letter of Credit Expiration Date.
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(d) PARTICIPATIONS. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby irrevocably grants to each Revolving Lender, and each Revolving Lender
hereby acquires from the Issuing Bank, a participation in such Letter of Credit
equal to such Revolving Lender's Pro Rata Percentage of the aggregate amount
available to be drawn under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Revolving Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for the account of
the Issuing Bank, such Revolving Lender's Pro Rata Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by U.S. Borrower on the
date due as provided in SECTION 2.18(e), or of any reimbursement payment
required to be refunded to U.S. Borrower for any reason. Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit, the occurrence and
continuance of a Default, reduction or termination of the Commitments, or
expiration, termination or cash collateralization of any Letter of Credit and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever.
(e) REIMBURSEMENT. (i) If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, U.S. Borrower shall reimburse
such LC Disbursement by paying to the Issuing Bank an amount equal to such LC
Disbursement not later than 3:00 p.m., New York City time, on the date that such
LC Disbursement is made if U.S. Borrower shall have received notice of such LC
Disbursement prior to 11:00 a.m., New York City time, on such date, or, if such
notice has not been received by U.S. Borrower prior to such time on such date,
then not later than 3:00 p.m., New York City time, on the Business Day
immediately following the day that U.S. Borrower receives such notice; PROVIDED
that U.S. Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with SECTION 2.03 that such payment be financed with ABR
Revolving Loans in an equivalent amount and, to the extent so financed, U.S.
Borrower's obligation to make such payment shall be discharged and replaced by
the resulting ABR Revolving Loans.
(ii) If U.S. Borrower fails to make such payment when due, the
Issuing Bank shall notify the Administrative Agent and the Administrative Agent
shall notify each Revolving Lender of the applicable LC Disbursement, the
payment then due from U.S. Borrower in respect thereof and such Revolving
Lender's Pro Rata Percentage thereof. Each Revolving Lender shall pay by wire
transfer of immediately available funds to the Administrative Agent not later
than 2:00 p.m., New York City time, on such date (or, if such Revolving Lender
shall have received such notice later than 12:00 noon, New York City time, on
any day, not later than 11:00 a.m., New York City time, on the immediately
following Business Day), an amount equal to such Revolving Lender's Pro Rata
Percentage of the unreimbursed LC Disbursement in the same manner as provided in
SECTION 2.02(c) with respect to Revolving Loans made by such Revolving Lender,
and the Administrative Agent will promptly pay to the Issuing Bank the amounts
so received by it from the Revolving Lenders. The Administrative Agent will
promptly pay to the Issuing Bank any amounts received by it from U.S. Borrower
pursuant to the above paragraph prior to the time that any Revolving Lender
makes any payment pursuant to the preceding sentence and any such amounts
received by the Administrative Agent from U.S. Borrower thereafter will be
promptly remitted by the Administrative Agent to the Revolving Lenders that
shall have made such payments and to the Issuing Bank, as appropriate.
(iii) If any Revolving Lender shall not have made its Pro Rata
Percentage of such LC Disbursement available to the Administrative Agent as
provided above, each of such Revolving Lender and U.S. Borrower severally agrees
to pay interest on such amount, for each day from and including the date such
amount is required to be paid in accordance with the foregoing to but excluding
the date such amount is paid, to the Administrative Agent for the account of the
Issuing Bank at (i) in the case of U.S.
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Borrower, the rate per annum set forth in SECTION 2.18(H) and (ii) in the case
of such Lender, at a rate determined by the Administrative Agent in accordance
with banking industry rules or practices on interbank compensation.
(f) OBLIGATIONS ABSOLUTE. The Reimbursement Obligation of U.S.
Borrower as provided in SECTION 2.18(e) shall be absolute, unconditional and
irrevocable, and shall be paid and performed strictly in accordance with the
terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein; (ii) any draft or
other document presented under a Letter of Credit being proved to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; (iii) payment by the Issuing Bank
under a Letter of Credit against presentation of a draft or other document that
fails to comply with the terms of such Letter of Credit; (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this SECTION 2.18, constitute a legal or
equitable discharge of, or provide a right of setoff against, the obligations of
U.S. Borrower hereunder; (v) the fact that a Default shall have occurred and be
continuing; or (vi) any material adverse change in the business, property,
results of operations, prospects or condition, financial or otherwise, of U.S.
Borrower and its Subsidiaries. None of the Agents, the Lenders, the Issuing Bank
or any of their Affiliates shall have any liability or responsibility by reason
of or in connection with the issuance or transfer of any Letter of Credit or any
payment or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; PROVIDED that the foregoing shall not be construed to excuse the
Issuing Bank from liability to U.S. Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by U.S. Borrower to the extent permitted by applicable law) suffered by
U.S. Borrower that are caused by the Issuing Bank's failure to exercise care
when determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or willful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) DISBURSEMENT PROCEDURES. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
give written notice to the Administrative Agent and U.S. Borrower of such demand
for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; PROVIDED that any failure to give or delay in giving
such notice shall not relieve U.S. Borrower of its Reimbursement Obligation to
the Issuing Bank and the Revolving Lenders with respect to any such LC
Disbursement (other than with respect to the timing of such Reimbursement
Obligation set forth in SECTION 2.18(e)).
(h) INTERIM INTEREST. If the Issuing Bank shall make any LC
Disbursement, then, unless U.S. Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest payable on demand, for each day from and including the date such
LC Disbursement is made to but excluding the date that U.S. Borrower reimburses
such LC
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Disbursement, at the rate per annum determined pursuant to SECTION 2.06(a) until
the day after U.S. Borrower is notified of such LC Disbursement and thereafter
pursuant to SECTION 2.06(c). Interest accrued pursuant to this paragraph shall
be for the account of the Issuing Bank, except that interest accrued on and
after the date of payment by any Revolving Lender pursuant to SECTION 2.18(e) to
reimburse the Issuing Bank shall be for the account of such Lender to the extent
of such payment.
(i) CASH COLLATERALIZATION. If any Event of Default shall occur
and be continuing, on the Business Day that U.S. Borrower receives notice from
the Administrative Agent or the Required Lenders (or, if the maturity of the
Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, U.S. Borrower shall deposit in the LC
Sub-Account, in the name of the Collateral Agent and for the benefit of the
Revolving Lenders, an amount in cash equal to the LC Exposure as of such date
plus any accrued and unpaid interest thereon; PROVIDED that the obligation to
deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other notice
of any kind, upon the occurrence of any Event of Default with respect to U.S.
Borrower described in paragraph (g) or (h) of ARTICLE VIII. Funds in the LC
Sub-Account shall be applied by the Collateral Agent to reimburse the Issuing
Bank for LC Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of outstanding
Reimbursement Obligations or, if the maturity of the Loans has been accelerated
(but subject to the consent of Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure), be applied to satisfy other
Obligations of U.S. Borrower under this Agreement. If U.S. Borrower is required
to provide an amount of cash collateral hereunder as a result of the occurrence
of an Event of Default, such amount PLUS any accrued interest or realized
profits with respect to such amounts (to the extent not applied as aforesaid)
shall be returned to U.S. Borrower within three Business Days after all Events
of Default have been cured or waived.
(j) ADDITIONAL ISSUING BANKS. U.S. Borrower may, at any time and
from time to time, designate one or more additional Revolving Lenders to act as
an issuing bank under the terms of this Agreement, with the consent of the
Administrative Agent (which consent shall not be unreasonable withheld), the
Issuing Bank and such Revolving Lender(s). Any Lender designated as an issuing
bank pursuant to this paragraph (j) shall be deemed (in addition to being a
Revolving Lender) to be the Issuing Bank with respect to Letters of Credit
issued or to be issued by such Revolving Lender, and all references herein and
in the other Loan Documents to the term "Issuing Bank" shall, with respect to
such Letters of Credit, be deemed to refer to such Revolving Lender in its
capacity as Issuing Bank, as the context shall require.
(k) RESIGNATION OR REMOVAL OF THE ISSUING BANK. The Issuing Bank
may resign as Issuing Bank hereunder at any time upon at least 30 days' prior
notice to the Lenders, the Administrative Agent and U.S. Borrower. The Issuing
Bank may be replaced at any time by written agreement among U.S. Borrower, each
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Bank or any such additional Issuing Bank. At the time any such
resignation or replacement shall become effective, U.S. Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
SECTION 2.05(c). From and after the effective date of any such resignation or
replacement or addition, as applicable, (i) the successor or additional Issuing
Bank shall have all the rights and obligations of the Issuing Bank under this
Agreement with respect to Letters of Credit to be issued by it thereafter and
(ii) references herein to the term "Issuing Bank" shall be deemed to refer to
such successor or such addition or to any previous Issuing Bank, or to such
successor or such addition and all previous Issuing Banks, as the context shall
require. After the resignation or replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such resignation or replace-
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ment, but shall not be required to issue additional Letters of Credit. If at any
time there is more than one Issuing Bank hereunder, U.S. Borrower may, in its
discretion, select which Issuing Bank is to issue any particular Letter of
Credit.
(l) OTHER. The Issuing Bank shall be under no obligation to issue
any Letter of Credit if
(i) any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the Issuing
Bank from issuing such Letter of Credit, or any law applicable to the
Issuing Bank or any request or directive (whether or not having the force
of law) from any Governmental Authority with jurisdiction over the Issuing
Bank shall prohibit, or request that the Issuing Bank refrain from, the
issuance of letters of credit generally or such Letter of Credit in
particular or shall impose upon the Issuing Bank with respect to such
Letter of Credit any restriction, reserve or capital requirement (for
which the Issuing Bank is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon the Issuing Bank any
unreimbursed loss, cost or expense which was not applicable on the Closing
Date and which the Issuing Bank in good ▇▇▇▇▇ ▇▇▇▇▇ material to it; or
(ii) the issuance of such Letter of Credit would violate one or
more policies of the Issuing Bank.
The Issuing Bank shall be under no obligation to amend any Letter of Credit if
(A) the Issuing Bank would have no obligation at such time to issue such Letter
of Credit in its amended form under the terms hereof, or (B) the beneficiary of
such Letter of Credit does not accept the proposed amendment to such Letter of
Credit.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Loan Party represents and warrants to the Administrative Agent,
the Collateral Agent, the Issuing Bank and each of the Lenders (with references
to the Companies being references thereto after giving effect to the
Transactions unless otherwise expressly stated) that:
SECTION 3.01 ORGANIZATION; POWERS. Each Company (a) is duly
organized and validly existing under the laws of the jurisdiction of its
organization, (b) has all requisite power and authority to carry on its business
as now conducted and to own and lease its property and (c) is qualified and in
good standing (to the extent such concept is applicable in the applicable
jurisdiction) to do business in every jurisdiction where such qualification is
required, except in such jurisdictions where the failure to so qualify or be in
good standing, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. There is no existing default
under any Organizational Document of any Company or any event which, with the
giving of notice or passage of time or both, would constitute a default by any
party thereunder.
SECTION 3.02 AUTHORIZATION; ENFORCEABILITY. The Transactions to be
entered into by each Loan Party are within such Loan Party's powers and have
been duly authorized by all necessary action on the part of such Loan Party.
This Agreement has been duly executed and delivered by each Loan Party and
constitutes, and each other Loan Document to which any Loan Party is to be a
party, when executed and delivered by such Loan Party, will constitute, a legal,
valid and binding obligation of such Loan Party, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency,
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reorganization, moratorium or other laws affecting creditors' rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or at law.
SECTION 3.03 NO CONFLICTS. Except as set forth on SCHEDULE 3.03,
the Transactions (a) do not require any consent or approval of, registration or
filing with, or any other action by, any Governmental Authority, except (i) such
as have been obtained or made and are in full force and effect, (ii) filings
necessary to perfect Liens created by the Loan Documents and (iii) consents,
approvals, registrations, filings, permits or actions the failure to obtain or
perform which could not reasonably be expected to result in a Material Adverse
Effect, (b) will not violate the Organizational Documents of any Company or any
law, judgment, decree or order of any Governmental Authority, (c) will not
violate or result in a default or require any consent or approval under any
indenture, agreement, Organizational Document or other instrument binding upon
any Company or its property, or give rise to a right thereunder to require any
payment to be made by any Company, except for violations, defaults or the
creation of such rights that could not reasonably be expected to result in a
Material Adverse Effect, and (d) will not result in the creation or imposition
of any Lien on any property of any Company, except Liens created by the Loan
Documents and Permitted Liens.
SECTION 3.04 FINANCIAL STATEMENTS; PROJECTIONS. (a) U.S. Borrower
has heretofore delivered to the Lenders the consolidated balance sheets and
related statements of income, stockholders' equity and cash flows of U.S.
Borrower (i) as of and for the fiscal years ended December 31, 2000, December
31, 2001 and December 31, 2002, audited by and accompanied by the unqualified
opinion of Ernst & Young, LLP, independent public accountants, and (y) as of and
for the nine-month period ended September 30, 2003 and for the comparable period
of the preceding fiscal year, in each case, certified by the chief financial
officer of U.S. Borrower. Such financial statements and all financial statements
delivered pursuant to SECTIONS 5.01(a) and (b) have been prepared in accordance
with GAAP and present fairly and accurately, in all material respects, the
financial condition and results of operations and cash flows of U.S. Borrower as
of the dates and for the periods to which they relate. Except as set forth in
such financial statements, there are no liabilities of any Company of any kind,
whether accrued, contingent, absolute, determined, determinable or otherwise,
which could reasonably be expected to result in a Material Adverse Effect, and
there is no existing condition, situation or set of circumstances which could
reasonably be expected to result in such a liability, other than liabilities
under the Loan Documents and the Senior Subordinated Note Documents.
(b) U.S. Borrower has heretofore delivered to the Lenders U.S.
Borrower's unaudited PRO FORMA consolidated balance sheet and statements of
income and cash flows and PRO FORMA EBITDA for the fiscal year ended December
31, 2002, and as of and for the nine-month period ended September 30, 2003 and
for the four-quarter period ended September 30, 2003, in each case after giving
effect to the Transactions as if they had occurred on such date in the case of
the balance sheet and as of the beginning of all periods presented in the case
of the statements of income and cash flows. Such PRO FORMA financial statements
have been prepared in good faith by the Loan Parties, based on the assumptions
stated therein (which assumptions are believed by the Loan Parties on the date
hereof and on the Closing Date to be reasonable), are based on the best
information available to the Loan Parties as of the date of delivery thereof,
accurately reflect all adjustments required to be made to give effect to the
Transactions, and present fairly in all material respects the PRO FORMA
consolidated financial position and results of operations of U.S. Borrower as of
such date and for such periods, assuming that the Transactions had occurred at
such dates.
(c) The forecasts of financial performance of Parent and its
subsidiaries furnished to the Lenders have been prepared in good faith by U.S.
Borrower and based on assumptions believed by U.S. Borrower to reasonable.
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(d) Since December 31, 2002, there has been no event, change,
circumstance or occurrence that, individually or in the aggregate, has had or
could reasonably be expected to result in a Material Adverse Effect.
SECTION 3.05 PROPERTIES. (a) Each Company has good title to, or
valid leasehold interests in, all its property material to its business, free
and clear of all Liens except for, in the case of Collateral, Permitted
Collateral Liens and, in the case of all other material property, Permitted
Liens and minor irregularities or deficiencies in title that, individually or in
the aggregate, do not interfere with its ability to conduct its business as
currently conducted or to utilize such property for its intended purpose. The
property of the Companies, taken as a whole, (i) is in good operating order,
condition and repair (ordinary wear and tear excepted), except to the extent
that the failure to be in such condition could not reasonably be expected to
result in a Material Adverse Effect, and (ii) constitutes all the property which
is required for the business and operations of the Companies as presently
conducted.
(b) SCHEDULE 3.05(b) contains a true and complete list of each
interest in Real Property (i) owned by any Company as of the date hereof and
describes the type of interest therein held by such Company and (ii) leased,
subleased or otherwise occupied or utilized by any Company, as lessee,
sublessee, franchisee or licensee, as of the date hereof and describes the type
of interest therein held by such Company and whether such lease, sublease or
other instrument requires the consent of the landlord thereunder or other
parties thereto to the Transactions.
(c) No Company has received any notice of, nor has any knowledge
of, the occurrence or pendency or contemplation of any Casualty Event in excess
of $5.0 million affecting all or any portion of its property. No Mortgage
encumbers improved Real Property that is located in an area that has been
identified by the Secretary of Housing and Urban Development as an area having
special flood hazards within the meaning of the National Flood Insurance Act of
1968 unless flood insurance available under such Act has been obtained in
accordance with SECTION 5.04.
(d) Each Company owns or has rights to use all of the Collateral
and all material rights with respect to any of the foregoing used in, necessary
for or material to each Company's business as currently conducted. The use by
each Company of such Collateral and all such rights with respect to the
foregoing do not infringe on the rights of any person other than such
infringement which could not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect. No claim has been made and
remains outstanding that any Company's use of any Collateral does or may violate
the rights of any third party that could, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
(e) The Equipment of each Company is in good repair, working order
and condition, reasonable wear and tear excepted. Each Company shall cause the
Equipment to be maintained and preserved in good repair, working order and
condition, reasonable wear and tear excepted, and shall as quickly as
commercially practicable make or cause to be made all repairs, replacements and
other improvements which are necessary or appropriate in the conduct of each
Company's business.
SECTION 3.06 INTELLECTUAL PROPERTY.
(a) OWNERSHIP/NO CLAIMS. Each Loan Party owns, or is licensed to
use, all patents, patent applications, trademarks, trade names, servicemarks,
copyrights, technology, trade secrets, proprietary information, domain names,
know-how and processes necessary for the conduct of its business as currently
conducted (the "INTELLECTUAL PROPERTY"), except for those the failure to own or
license which, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. No claim has been asserted and
is pending by any person challenging or questioning the use of any such
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Intellectual Property or the validity or effectiveness of any such Intellectual
Property, nor does any Loan Party know of any valid basis for any such claim. To
the knowledge of the Loan Parties, the use of such Intellectual Property by each
Loan Party does not infringe the rights of any person, except for such claims
and infringements that, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect.
(b) REGISTRATIONS. Except pursuant to licenses and other user
agreements entered into by each Loan Party in the ordinary course of business
that are listed in SCHEDULES 14(a) and 14(b) to the Perfection Certificate, on
and as of the date hereof (i) each Loan Party owns and possesses the right to
use, and has taken no affirmative action to authorize or enable any other person
to use, any copyright, patent or trademark (as such terms are defined in the
U.S. Security Agreement) listed in SCHEDULES 14(a) and 14(b) to the Perfection
Certificate and (ii) all registrations listed in SCHEDULES 14(a) and 14(b) to
the Perfection Certificate are valid and in full force and effect.
(c) NO VIOLATIONS OR PROCEEDINGS. To each Loan Party's knowledge,
on and as of the date hereof, there is no material violation by others of any
right of such Loan Party with respect to any copyright, patent or trademark
listed in SCHEDULES 14(a) and 14(b) to the Perfection Certificate, respectively,
pledged by it under the name of such Loan Party.
SECTION 3.07 EQUITY INTERESTS AND SUBSIDIARIES. (a) SCHEDULE
3.07(A) sets forth a list of (i) all the Subsidiaries of Parent and their
jurisdiction of organization as of the Closing Date and (ii) the number of each
class of its Equity Interests authorized, and the number outstanding, on the
Closing Date and the number of shares covered by all outstanding options,
warrants, rights of conversion or purchase and similar rights at the Closing
Date. All Equity Interests of each Company owned by Parent and its Subsidiaries
are duly and validly issued and are fully paid and non-assessable, and, other
than the Equity Interests of U.S. Borrower, are owned by U.S. Borrower, directly
or indirectly through Subsidiaries. All Equity Interests of U.S. Borrower are
owned directly by Parent (or, after an IPO, the IPO Entity) and, prior to an
IPO, all Equity Interests of Parent are owned directly by Holdings. Each Loan
Party is the record and beneficial owner of, and has good and marketable title
to, the Equity Interests pledged by it under the U.S. Security Agreement, free
of any and all Liens, rights or claims of other persons, except the security
interest created by the U.S. Security Agreement and there are no outstanding
warrants, options or other rights to purchase, or shareholder, voting trust or
similar agreements outstanding with respect to, or property that is convertible
into, or that requires the issuance or sale of, any such Equity Interests.
(b) No consent of any person including any other general or
limited partner, any other member of a limited liability company, any other
shareholder or any other trust beneficiary is necessary or reasonably desirable
(from the perspective of a secured party) in connection with the creation,
perfection or first priority status of the security interest of the Collateral
Agent in any Equity Interests pledged to the Collateral Agent for the benefit of
the Secured Parties under the Security Agreement or the exercise by the
Collateral Agent of the voting or other rights provided for in the Security
Agreement or the exercise of remedies in respect thereof.
(c) An accurate organization chart, showing the ownership
structure of Parent, U.S. Borrower and each Subsidiary on the Closing Date, and
after giving effect to the Transactions, is set forth on SCHEDULE 3.07(c).
SECTION 3.08 LITIGATION; COMPLIANCE WITH LAWS. (a) There are no
actions, suits or proceedings at law or in equity by or before any Governmental
Authority now pending or, to the knowledge of any Company, threatened against or
affecting any Company or any business, property or rights of any Company (i)
that involve any Loan Document or any of the Transactions or (ii) as to which
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there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect.
(b) Except for matters covered by SECTION 3.18, no Company or any
of its property is in violation of, nor will the continued operation of its
property as currently conducted violate, any Requirements of Law (including any
zoning or building ordinance, code or approval or any building permits) or any
restrictions of record or agreements affecting any Company's Real Property or is
in default with respect to any judgment, writ, injunction, decree, rule or order
of any Governmental Authority, where such violation or default, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.09 AGREEMENTS. (a) No Company is a party to any
agreement or instrument or subject to any corporate or other constitutional
restriction that has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(b) No Company is in default in any manner under any provision of
any indenture or other agreement or instrument evidencing Indebtedness, or any
other agreement or instrument to which it is a party or by which it or any of
its property is or may be bound, where such default could reasonably be expected
to result in a Material Adverse Effect, and no condition exists which, with the
giving of notice or the lapse of time or both, would constitute such a default.
(c) SCHEDULE 3.09(c) accurately and completely lists all material
agreements (other than leases of Real Property set forth on SCHEDULE 3.05(b)) to
which any Company is a party which are in effect on the date hereof in
connection with the operation of the business conducted thereby and U.S.
Borrower has delivered to the Administrative Agent complete and correct copies
of all such material agreements, including any amendments, supplements or
modifications with respect thereto, and as of the date hereof all such
agreements are in full force and effect.
SECTION 3.10 FEDERAL RESERVE REGULATIONS. (a) No Company is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of buying or carrying Margin Stock.
(b) No part of the proceeds of any Loan or any Letter of Credit
will be used, whether directly or indirectly, and whether immediately,
incidentally or ultimately, for any purpose that entails a violation of, or that
is inconsistent with, the provisions of the regulations of the Board, including
Regulation T, U or X. The pledge of the Securities Collateral pursuant to the
Security Agreement does not violate such regulations.
SECTION 3.11 INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT. No Company is (a) an "investment company" or a company "controlled"
by a person required to register as an "investment company," as defined in, or
subject to regulation under, the Investment Company Act of 1940, as amended, or
(b) a "holding company," an "affiliate" of a "holding company" or a "subsidiary
company" of a "holding company," as defined in, or subject to regulation under,
the Public Utility Holding Company Act of 1935, as amended.
SECTION 3.12 USE OF PROCEEDS. The Borrowers will use the proceeds
of (a) the Term Loans to effect the Acquisition and the Refinancing and pay
related fees and expenses, (b) the Revolving Loans after the Closing Date for
general corporate purposes and up to $3.0 million on the Closing Date to effect
the Acquisition and the Refinancing and pay related fees and expenses and (c)
the Swingline Loans after the Closing Date for general corporate purposes.
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SECTION 3.13 TAXES. Each Company has (a) timely filed or caused to
be timely filed all federal Tax Returns and all state, local and foreign Tax
Returns or materials required to have been filed by it and all such Tax Returns
are true and correct in all material respects and (b) duly and timely paid,
collected or remitted or caused to be duly and timely paid, collected or
remitted all Taxes (whether or not shown on any Tax Return) due and payable,
collectible or remittable by it and all assessments received by it, except Taxes
(i) that are being contested in good faith by appropriate proceedings and for
which such Company has set aside on its books adequate reserves in accordance
with GAAP and (ii) which could not, individually or in the aggregate, have a
Material Adverse Effect. Each Company has made adequate provision in accordance
with GAAP for all Taxes not yet due and payable. Each Company is unaware of any
proposed or pending tax assessments, deficiencies or audits that could be
reasonably expected to, individually or in the aggregate, result in a Material
Adverse Effect. No Company has ever been a party to any understanding or
arrangement constituting a "tax shelter" within the meaning of Section 6111(c),
Section 6111(d) or Section 6662(d)(2)(C)(iii) of the Code, or has ever
"participated" in a "reportable transaction" within the meaning of Treasury
Regulation Section 1.6011-4, except as could not be reasonably expected to,
individually or in the aggregate, result in a Material Adverse Effect.
SECTION 3.14 NO MATERIAL MISSTATEMENTS. No information, report,
financial statement, certificate, Borrowing Request, LC Request, exhibit or
schedule furnished by or on behalf of any Company to the Administrative Agent or
any Lender in connection with the negotiation of any Loan Document or included
therein or delivered pursuant thereto (including the Confidential Information
Memorandum), taken as a whole, contained or contains any material misstatement
of fact or omitted or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were or
are made, not misleading as of the date such information is dated or certified;
PROVIDED that to the extent any such information, report, financial statement,
exhibit or schedule was based upon or constitutes a forecast or projection, each
Company represents only that it acted in good faith and utilized reasonable
assumptions and due care in the preparation of such information, report,
financial statement, exhibit or schedule.
SECTION 3.15 LABOR MATTERS. As of the date hereof and the Closing
Date, there are no strikes, lockouts or slowdowns against any Company pending
or, to the knowledge of any Company, threatened. The hours worked by and
payments made to employees of any Company have not been in violation of the Fair
Labor Standards Act of 1938, as amended, or any other applicable federal, state,
local or foreign law dealing with such matters in any manner which could
reasonably be expected to result in a Material Adverse Effect. All payments due
from any Company, or for which any claim may be made against any Company, on
account of wages and employee health and welfare insurance and other benefits,
have been paid or accrued as a liability on the books of such Company except
where the failure to do so could not reasonably be expected to result in a
Material Adverse Effect. The consummation of the Transactions will not give rise
to any right of termination or right of renegotiation on the part of any union
under any collective bargaining agreement to which any Company is bound.
SECTION 3.16 SOLVENCY. Immediately after the consummation of the
Transactions to occur on the Closing Date and immediately following the making
of each Loan and after giving effect to the application of the proceeds of each
Loan, (a) the fair value of the properties of each Loan Party (individually and
on a consolidated basis with its Subsidiaries) will exceed its debts and
liabilities, subordinated, contingent or otherwise; (b) the present fair
saleable value of the property of each Loan Party (individually and on a
consolidated basis with its Subsidiaries) will be greater than the amount that
will be required to pay the probable liability of its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (c) each Loan Party (individually and
on a consolidated basis with its Subsidiaries) will be able to pay its debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) each Loan Party (individually
and on a consolidated basis with its Subsidiaries) will not have unreasonably
small
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capital with which to conduct its business in which it is engaged as such
business is now conducted and is proposed to be conducted following the Closing
Date.
SECTION 3.17 EMPLOYEE BENEFIT PLANS. (a) Except as could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect, each Company and its ERISA Affiliates is in compliance with the
applicable provisions of ERISA and the Code and the regulations and published
interpretations thereunder. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events,
could reasonably be expected to result in a Material Adverse Effect or the
imposition of a Lien on any of the property of any Company. The present value of
all accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of Statement of Financial Accounting Standards No.
87) did not, as of the date of the most recent financial statements reflecting
such amounts, exceed by more than $10.0 million the fair market value of the
property of all such underfunded Plans. Except as set forth on SCHEDULE 3.17,
using actuarial assumptions and computation methods consistent with subpart I of
subtitle E of Title IV of ERISA, the aggregate liabilities of each Company or
its ERISA Affiliates to all Multiemployer Plans in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Multiemployer Plan, could not reasonably be expected to result in a
Material Adverse Effect.
(b) Except as could not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect, to the extent applicable, each
Foreign Plan has been maintained in substantial compliance with its terms and
with the requirements of any and all applicable laws, statutes, rules,
regulations and orders and has been maintained, where required, in good standing
with applicable regulatory authorities. No Company has incurred any material
unpaid obligation in connection with the termination of or withdrawal from any
Foreign Plan. Except as could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, the present value of the accrued
benefit liabilities (whether or not vested) under each Foreign Plan which is
funded, determined as of the end of the most recently ended fiscal year of the
respective Company on the basis of actuarial assumptions, each of which is
reasonable, did not exceed the current value of the property of such Foreign
Plan, and for each Foreign Plan which is not funded, the obligations of such
Foreign Plan are properly accrued.
SECTION 3.18 ENVIRONMENTAL MATTERS. (a) Except as set forth in
SCHEDULE 3.18 and except as, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect:
(i) The Companies and their businesses, operations and Real
Property are and in the last six years have been in compliance with, and
the Companies have no liability under, Environmental Law;
(ii) The Companies have obtained all Environmental Permits required
for the conduct of their businesses and operations, and the ownership,
operation and use of their property, under Environmental Law, all such
Environmental Permits are valid and in good standing;
(iii) There has been no Release or threatened Release of Hazardous
Material on, at, under or from any Real Property or facility presently or
formerly owned, leased or operated by the Companies or their predecessors
in interest that could result in liability by the Companies under
Environmental Law;
(iv) There is no Environmental Claim pending or, to the knowledge
of the Companies, threatened against the Companies, or relating to the
Real Property currently or formerly owned, leased or operated by the
Companies or relating to the operations of the Companies, and
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to the knowledge of the Companies, there are no actions, activities,
circumstances, conditions, events or incidents that could form the basis
of such an Environmental Claim;
(v) No person with an indemnity or contribution obligation to the
Companies relating to compliance with or liability under Environmental Law
is in default with respect to such obligation; and
(vi) No Company is obligated to perform any action or otherwise
incur any expense under Environmental Law pursuant to any order, decree,
judgment or agreement by which it is bound or has assumed by contract or
agreement, and no Company is conducting or financing any Response pursuant
to any Environmental Law with respect to any Real Property or any other
location.
(b) Except as set forth in SCHEDULE 3.18:
(i) No Real Property or facility owned, operated or leased by the
Companies and, to the knowledge of the Companies, no Real Property or
facility formerly owned, operated or leased by the Companies or any of
their predecessors in interest is (i) listed or proposed for listing on
the National Priorities List promulgated pursuant to CERCLA or (ii) listed
on the Comprehensive Environmental Response, Compensation and Liability
Information System promulgated pursuant to CERCLA or (iii) included on any
similar list maintained by any Governmental Authority including any such
list relating to petroleum;
(ii) No Lien has been recorded or, to the knowledge of any Company,
threatened under any Environmental Law with respect to any Real Property
or property of the Companies;
(iii) The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby will not require
any notification, registration, filing, reporting, disclosure,
investigation, remediation or cleanup pursuant to any Governmental Real
Property Disclosure Requirements or any other Environmental Law; and
(iv) The Companies have made available to the Lenders all material
records and files in the possession, custody or control of, or otherwise
reasonably available to, the Companies concerning compliance with or
liability under Environmental Law, including those concerning the
existence of Hazardous Material at Real Property or facilities currently
or formerly owned, operated, leased or used by the Companies.
SECTION 3.19 INSURANCE. SCHEDULE 3.19 sets forth a true, complete
and correct description of all insurance maintained by each Company as of the
Closing Date. All insurance maintained by the Companies is in full force and
effect, all premiums have been duly paid, no Company has received notice of
violation or cancellation thereof, the Premises, and the use, occupancy and
operation thereof, comply in all material respects with all Insurance
Requirements, and there exists no material default under any Insurance
Requirement. Each Company has insurance in such amounts and covering such risks
and liabilities as are customary for companies of a similar size engaged in
similar businesses in similar locations.
SECTION 3.20 SECURITY DOCUMENTS. (a) The U.S. Security Agreement
is effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties, legal, valid and enforceable Liens on, and security interests
in, the U.S. Security Agreement Collateral and (i) when financing statements and
other filings in appropriate form are filed in the offices specified on SCHEDULE
7 to the Perfection Certificate and (ii) upon the taking of possession or
control by the Collateral Agent of the U.S.
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Security Agreement Collateral with respect to which a security interest may be
perfected only by possession or control (which possession or control shall be
given to the Collateral Agent to the extent possession or control by the
Collateral Agent is required by the U.S. Security Agreement), the Liens created
by the U.S. Security Agreement shall constitute fully perfected Liens on, and
security interests in, all right, title and interest of the grantors thereunder
in the U.S. Security Agreement Collateral (other than (A) the Intellectual
Property Collateral (as defined in the U.S. Security Agreement) and (B) such
U.S. Security Agreement Collateral in which a security interest cannot be
perfected under the UCC as in effect at the relevant time in the relevant
jurisdiction), in each case subject to no Liens other than Permitted Collateral
Liens.
(b) The Canadian Security Agreement is effective to create in
favor of the Collateral Agent for the benefit of the Canadian Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Canadian
Security Agreement Collateral and (i) when financing statements and other
filings in appropriate form are filed in the offices specified on SCHEDULE 7 to
the Perfection Certificate and (ii) upon the taking of possession or control by
the Collateral Agent of the Canadian Security Agreement Collateral with respect
to which a security interest may be perfected only by possession or control
(which possession or control shall be given to the Collateral Agent to the
extent possession or control by the Collateral Agent is required by the Canadian
Security Agreement), the Liens created by the Canadian Security Agreement shall
constitute fully perfected Liens on, and security interests in, all right, title
and interest of the grantors thereunder in the Canadian Security Agreement
Collateral (other than (A) the Intellectual Property Collateral (as defined in
the Canadian Security Agreement) and (B) such Canadian Security Agreement
Collateral in which a security interest cannot be perfected under the PPSA as in
effect at the relevant time in the relevant jurisdiction), in each case subject
to no Liens other than Permitted Collateral Liens.
(c) When the U.S. Security Agreement or a short form thereof is
filed in the United States Patent and Trademark Office and the United States
Copyright Office, the Liens created by such U.S. Security Agreement shall
constitute fully perfected Liens on, and security interests in, all right, title
and interest of the grantors thereunder in the Intellectual Property Collateral
(as defined in such Security Agreement) in which a security interest may be
perfected under applicable U.S. law, in each case subject to no Liens other than
Permitted Collateral Liens.
(d) Each Mortgage granted by a U.S. Loan Party is effective to
create, in favor of the Collateral Agent, for its benefit and the benefit of the
Secured Parties, legal, valid and enforceable first priority Liens on, and
security interests in, all of such U.S. Loan Party's right, title and interest
in and to the U.S. Mortgaged Properties thereunder and the proceeds thereof,
subject only to Permitted Collateral Liens or other Liens acceptable to the
Collateral Agent, and when such Mortgages are filed in the offices specified on
SCHEDULE 1.01(d) (or, in the case of any such Mortgage executed and delivered
after the date thereof in accordance with the provisions of SECTIONS 5.10, 5.11
and 5.13, when such Mortgage is filed in the offices specified in the local
counsel opinion delivered with respect thereto in accordance with the provisions
of SECTIONS 5.10, 5.11 and 5.13), such Mortgages shall constitute fully
perfected Liens on, and security interests in, all right, title and interest of
the Loan Parties in the U.S. Mortgaged Properties and the proceeds thereof, in
each case prior and superior in right to any other person, other than Liens
permitted by such Mortgage.
(e) Each Mortgage granted by a Canadian Loan Party is effective to
create, in favor of the Collateral Agent or its sub-agent, for its benefit and
the benefit of the Canadian Secured Parties, legal, valid and enforceable first
priority Liens on, and security interests in, all of such Canadian Loan Party's
right, title and interest in and to the Canadian Mortgaged Properties thereunder
and the proceeds thereof, subject only to Permitted Collateral Liens or other
Liens acceptable to the Collateral Agent, and when such Mortgages are filed in
the offices specified on SCHEDULE 1.01(d) (or, in the case of any such
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Mortgage executed and delivered after the date thereof in accordance with the
provisions of SECTIONS 5.10 and 5.11, when such Mortgage is filed in the offices
specified in the local counsel opinion delivered with respect thereto in
accordance with the provisions of SECTIONS 5.10 and 5.11), such Mortgages shall
constitute fully perfected Liens on, and security interests in, all right, title
and interest of the Loan Parties in the Canadian Mortgaged Properties and the
proceeds thereof, in each case prior and superior in right to any other person,
other than Liens permitted by such Mortgage.
(f) Each Security Document delivered pursuant to SECTIONS 5.10,
5.11 and 5.13 will, upon execution and delivery thereof, be effective to create
in favor of the Collateral Agent, for the benefit of the applicable Secured
Parties, legal, valid and enforceable Liens on, and security interests in, all
of the Loan Parties' right, title and interest in and to the Collateral
thereunder, and when all appropriate filings or recordings are made in the
appropriate offices as may be required under applicable law, such Security
Document will constitute fully perfected Liens on, and security interests in,
all right, title and interest of the Loan Parties in such Collateral, in each
case subject to no Liens other than the applicable Permitted Collateral Liens.
SECTION 3.21 ACQUISITION DOCUMENTS; REPRESENTATIONS AND WARRANTIES
IN ACQUISITION AGREEMENT. (a) SCHEDULE 3.21 lists (i) each exhibit, schedule,
annex or other attachment to the Acquisition Agreement and (ii) each agreement,
certificate, instrument, letter or other document contemplated by the
Acquisition Agreement or any item referred to in clause (i) to be entered into,
executed or delivered or to become effective in connection with the Acquisition
or otherwise entered into, executed or delivered in connection with the
Acquisition. The Lenders have been furnished true and complete copies of each
Acquisition Document to the extent executed and delivered on or prior to the
Closing Date.
(b) All representations and warranties of each Company set forth
in the Acquisition Agreement were true and correct in all material respects as
of the time such representations and warranties were made and shall be true and
correct in all material respects as of the Closing Date as if such
representations and warranties were made on and as of such date, unless stated
to relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date.
SECTION 3.22 ANTI-TERRORISM LAW. (a) No Loan Party and, to the
knowledge of the Loan Parties, none of its Affiliates is in violation of any
laws relating to terrorism or money laundering ("ANTI-TERRORISM LAWS"),
including Executive Order No. 13224 on Terrorist Financing, effective September
24, 2001 (the "EXECUTIVE Order"), and the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Public Law 107-56.
(b) No Loan Party and to the knowledge of the Loan Parties, no
Affiliate or broker or other agent of any Loan Party acting or benefiting in any
capacity in connection with the Loans is any of the following:
(i) a person that is listed in the annex to, or is otherwise
subject to the provisions of, the Executive Order;
(ii) a person owned or controlled by, or acting for or on behalf
of, any person that is listed in the annex to, or is otherwise subject to
the provisions of, the Executive Order;
(iii) a person with which any Lender is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism Law;
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(iv) a person that commits, threatens or conspires to commit or
supports "terrorism" as defined in the Executive Order; or
(v) a person that is named as a "specially designated national and
blocked person" on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control ("OFAC") at its official
website or any replacement website or other replacement official
publication of such list.
(c) No Loan Party and, to the knowledge of the Loan Parties, no
broker or other agent of any Loan Party acting in any capacity in connection
with the Loans (i) conducts any business or engages in making or receiving any
contribution of funds, goods or services to or for the benefit of any person
described in paragraph (b) above, (ii) deals in, or otherwise engages in any
transaction relating to, any property or interests in property blocked pursuant
to the Executive Order, or (iii) engages in or conspires to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in any Anti-Terrorism
Law.
SECTION 3.23 SUBORDINATION OF SENIOR SUBORDINATED NOTES. The
Obligations are "Senior Debt," the U.S. Guaranteed Obligations are "Guarantor
Senior Debt" and the Obligations and U.S. Guaranteed Obligations are "Designated
Senior Debt," in each case, within the meaning of the Senior Subordinated Note
Documents.
ARTICLE IV
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01 CONDITIONS TO INITIAL CREDIT EXTENSION. The
obligation of each Lender and, if applicable, each Issuing Bank to fund the
initial Credit Extension requested to be made by it shall be subject to the
prior or concurrent satisfaction of each of the conditions precedent set forth
in this SECTION 4.01.
(a) LOAN DOCUMENTS. All legal matters incident to this Agreement,
the Credit Extensions hereunder and the other Loan Documents shall be reasonably
satisfactory to the Lenders, to the Issuing Bank and to the Administrative Agent
and there shall have been delivered to the Administrative Agent an executed
counterpart of each of the Loan Documents and the Perfection Certificate.
(b) CORPORATE DOCUMENTS. The Administrative Agent shall have
received:
(i) a certificate of the secretary or assistant secretary of each
Loan Party dated the Closing Date, certifying (A) that attached thereto is
a true and complete copy of each Organizational Document of such Loan
Party certified (to the extent applicable) as of a recent date by the
Secretary of State of the state of its organization, (B) that attached
thereto is a true and complete copy of resolutions duly adopted by the
Board of Directors of such Loan Party authorizing the execution, delivery
and performance of the Loan Documents to which such person is a party and,
in the case of each Borrower, the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full
force and effect and (C) as to the incumbency and specimen signature of
each officer executing any Loan Document or any other document delivered
in connection herewith on behalf of such Loan Party (together with a
certificate of another officer as to the incumbency and specimen signature
of the secretary or assistant secretary executing the certificate in this
clause (i));
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(ii) a certificate as to the good standing of each Loan Party (in
so-called "long-form" if available) as of a recent date, from such
Secretary of State (or other applicable Governmental Authority); and
(iii) such other documents as the Lenders, the Issuing Bank or the
Administrative Agent may reasonably request.
(c) OFFICERS' CERTIFICATE. The Administrative Agent shall have
received a certificate, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of U.S. Borrower, confirming compliance
with the conditions precedent set forth in this SECTION 4.01 and SECTIONS
4.02(b), (c) and (d).
(d) FINANCINGS AND OTHER TRANSACTIONS, ETC. (i) The Transactions
shall have been consummated or shall be consummated simultaneously on the
Closing Date, in each case in all material respects in accordance with the terms
hereof and the terms of the Transaction Documents, without the waiver or
amendment of any such terms not approved by the Joint Lead Arrangers (such
consent not to be unreasonably withheld).
(ii) U.S. Borrower shall have received not less than $225.0 million
in gross proceeds from the issuance and sale of the Senior Subordinated Notes,
and the Senior Subordinated Note Agreement shall be in form and substance
reasonably satisfactory to the Lenders.
(iii) The Equity Financing shall have been consummated. The terms of
the Equity Financing and the Rollover Equity shall not require any payments or
other distributions of cash or property in respect thereof other than payments
in kind, or any purchases, redemptions or other acquisitions thereof for cash or
property other than payments in kind, in each case prior to the payment in full
of all obligations under the Loan Documents and the Senior Subordinated Notes,
except as permitted by the Loan Documents.
(iv) The Refinancing shall have been consummated in full to the
reasonable satisfaction of the Lenders with all liens in favor of the existing
lenders being unconditionally released; the Administrative Agent shall have
received a "pay-off" letter in form and substance reasonably satisfactory to the
Administrative Agent with respect to all debt being refinanced in the
Refinancing; and the Administrative Agent shall have received from any person
holding any Lien securing any such debt, such UCC termination statements,
mortgage releases, releases of assignments of leases and rents, releases of
security interests in Intellectual Property and other instruments, in each case
in proper form for recording, as the Administrative Agent shall have reasonably
requested to release and terminate of record the Liens securing such debt.
(e) FINANCIAL STATEMENTS, PRO FORMA BALANCE SHEET; PROJECTIONS.
The Lenders shall have received and shall be reasonably satisfied with the form
and substance of the financial statements described in SECTION 3.04(B) and with
the forecasts of the financial performance of Parent and its Subsidiaries.
(f) INDEBTEDNESS AND MINORITY INTERESTS. After giving effect to
the Transactions and the other transactions contemplated hereby, no Company
shall have outstanding any Indebtedness or preferred stock other than (i) the
Loans and Credit Extensions hereunder, (ii) the Senior Subordinated Notes, (iii)
the Indebtedness listed on SCHEDULE 6.01(b), (iv) the Assumed Debt and (v)
Indebtedness owed to either Borrower or any Guarantor.
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(g) OPINIONS OF COUNSEL. The Administrative Agent shall have
received, on behalf of itself, the other Agents, the Arrangers, the Lenders and
the Issuing Bank, a favorable written opinion of (i) ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, special counsel for the Loan Parties, substantially to
the effect set forth in EXHIBIT N-1, (ii) each local counsel listed on SCHEDULE
4.01(g), substantially to the effect set forth in EXHIBIT N-2, and (iii) ▇▇▇▇▇▇▇
▇▇▇▇▇ LLP, Canadian counsel for the Loan Parties, substantially to the effect
set forth in EXHIBIT N-3, in each case (A) dated the Closing Date and (B)
addressed to the Agents, the Issuing Bank and the Lenders, and (iii) a copy of
each legal opinion delivered under the other Transaction Documents, accompanied
by reliance letters from the party delivering such opinion authorizing the
Agents, Lenders and the Issuing Bank to rely thereon as if such opinion were
addressed to them.
(h) SOLVENCY CERTIFICATE. The Administrative Agent shall have
received a solvency certificate in the form of EXHIBIT O, dated the Closing Date
and signed by the treasurer or the chief financial officer of U.S. Borrower.
(i) REQUIREMENTS OF LAW. The Lenders shall be satisfied that
Parent, its Subsidiaries and the Transactions shall be in full compliance with
all material Requirements of Law, including Regulations T, U and X of the Board,
and shall have received reasonably satisfactory evidence of such compliance
reasonably requested by them.
(j) CONSENTS. The Lenders shall be reasonably satisfied that all
requisite Governmental Authorities and third parties shall have approved or
consented to the Transactions, and there shall be no governmental or judicial
action, actual or threatened, that has or would have, singly or in the
aggregate, a reasonable likelihood of restraining, preventing or imposing
burdensome conditions on the Transactions or the other transactions contemplated
hereby.
(k) LITIGATION. There shall be no litigation, public or private,
or administrative proceedings, governmental investigation or other legal or
regulatory developments, actual or threatened, that, singly or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect, or could
materially and adversely affect the ability of Holdings, Parent, U.S. Borrower
and their respective Subsidiaries to fully and timely perform their respective
obligations under the Transaction Documents, or the ability of the parties to
consummate the financings contemplated hereby or the other Transactions.
(l) SOURCES AND USES. The sources and uses of the Loans shall be
as set forth in SECTION 3.12.
(m) FEES. The Arrangers and the Administrative Agent shall have
received all Fees and other amounts due and payable on or prior to the Closing
Date, including reimbursement or payment of all out-of-pocket expenses
(including the legal fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, special
counsel to the Agents, and the fees and expenses of any local counsel, foreign
counsel, appraisers, consultants and other advisors) required to be reimbursed
or paid by either Borrower hereunder or under any other Loan Document.
(n) PERSONAL PROPERTY REQUIREMENTS. The Collateral Agent shall
have received:
(i) all certificates, agreements or instruments representing or
evidencing the Securities Collateral accompanied by instruments of
transfer and stock powers undated and endorsed in blank;
(ii) the Intercompany Note executed by and among Parent and each of
its Subsidiaries (other than Canadian Borrower) and the Canadian
Intercompany Note executed by and among
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Canadian Borrower, Parent and each of its Subsidiaries, each accompanied by
instruments of transfer undated and endorsed in blank;
(iii) all other certificates, agreements, including control
agreements, or instruments necessary to perfect the Collateral Agent's
security interest in all Chattel Paper, all Instruments, all Deposit
Accounts and all Investment Property of each Loan Party (as each such term
is defined in either Security Agreement and to the extent required by
either Security Agreement);
(iv) financing statements in appropriate form for filing under the
UCC and PPSA, filings with the United States Patent and Trademark Office,
and the United States Copyright Office and such other documents under
applicable Requirements of Law in each jurisdiction as may be necessary or
appropriate or, in the opinion of the Collateral Agent, desirable to
perfect the Liens created, or purported to be created, by the Security
Documents under the laws of the United States, Canada or any State or
Province thereof and, with respect to all UCC financing statements
required to be filed pursuant to the Loan Documents, evidence satisfactory
to the Administrative Agent that U.S. Borrower has retained, at its sole
cost and expense, a service provider acceptable to the Administrative
Agent for the tracking of all such financing statements and notification
to the Administrative Agent, of, among other things, the upcoming lapse or
expiration thereof;
(v) certified copies of UCC, PPSA, United States Patent and
Trademark Office, United States Copyright Office, tax and judgment lien
searches, bankruptcy and pending lawsuit searches or equivalent reports or
searches, each of a recent date listing all effective financing
statements, lien notices or comparable documents that name any Loan Party
as debtor and that are filed in those state and county jurisdictions in
which any property of any Loan Party is located and the state and county
jurisdictions in which any Loan Party is organized or maintains its
principal place of business and such other searches that the Collateral
Agent deems necessary or appropriate, none of which encumber the
Collateral covered or intended to be covered by the Security Documents
(other than Permitted Collateral Liens or any other Liens acceptable to
the Collateral Agent);
(vi) with respect to each location set forth on SCHEDULE
4.01(n)(vi), a Landlord Access Agreement or Bailee Letter, as applicable;
PROVIDED that no such Landlord Access Agreement shall be required with
respect to any Real Property that could not be obtained after the Loan
Party that is the lessee or owner of the inventory or other personal
property Collateral stored with the bailee thereof, as applicable, shall
have used all commercially reasonable efforts to do so; and
(vii) evidence acceptable to the Collateral Agent of payment or
arrangements for payment by the Loan Parties of all applicable recording
taxes, fees, charges, costs and expenses required for the recording of the
Security Documents.
(o) REAL PROPERTY REQUIREMENTS. The Collateral Agent shall have
received:
(i) a Mortgage, encumbering each Mortgaged Property in favor of
the Collateral Agent, for the benefit of the applicable Secured Parties,
duly executed and acknowledged by each Loan Party that is the owner of or
holder of any interest in such Mortgaged Property, and otherwise in form
for recording in the recording office of each applicable political
subdivision where each such Mortgaged Property is situated, together with
such certificates, affidavits, questionnaires or returns as shall be
required in connection with the recording or filing thereof to create a
lien under applicable law, and such financing statements and any other
instruments necessary to grant a mortgage lien under the laws of any
applicable jurisdiction, all of which shall be in form and substance
reasonably satisfactory to Collateral Agent;
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(ii) with respect to each Mortgaged Property, such consents,
approvals, amendments, supplements, estoppels, tenant subordination
agreements or other instruments as necessary to consummate the
Transactions or as shall reasonably be deemed necessary by the Collateral
Agent in order for the owner or holder of the fee or leasehold interest
constituting such Mortgaged Property to grant the Lien contemplated by the
Mortgage with respect to such Mortgaged Property;
(iii) with respect to each Mortgage, a policy of title insurance (or
marked up title insurance commitment having the effect of a policy of
title insurance) insuring the Lien of such Mortgage as a valid first
mortgage Lien on the Mortgaged Property and fixtures described therein in
the amount equal to not less than 115% of the fair market value of such
Mortgaged Property and fixtures, which fair market value is set forth on
SCHEDULE 4.01(o)(iii), which policy (or such marked-up commitment) (each,
a "TITLE POLICY") shall (A) be issued by the Title Company, (B) to the
extent necessary, include such reinsurance arrangements (with provisions
for direct access, if necessary) as shall be reasonably acceptable to the
Collateral Agent, (C) contain a "tie-in" or "cluster" endorsement, if
available under applicable law (I.E., policies which insure against losses
regardless of location or allocated value of the insured property up to a
stated maximum coverage amount), (D) have been supplemented by such
endorsements (or where such endorsements are not available, opinions of
special counsel, architects or other professionals reasonably acceptable
to the Collateral Agent) as shall be reasonably requested by the
Collateral Agent (including endorsements on matters relating to usury,
first loss, last dollar, zoning, contiguity, revolving credit, doing
business, non-imputation, public road access, survey, variable rate,
environmental lien, subdivision, separate tax lot revolving credit, and
so-called comprehensive coverage over covenants and restrictions), and (E)
contain no exceptions to title other than Permitted Collateral Liens and
exceptions acceptable to the Collateral Agent;
(iv) with respect to each Mortgaged Property, such affidavits,
certificates, information (including financial data) and instruments of
indemnification (including a so-called "gap" indemnification) as shall be
required to induce the Title Company to issue the Title Policy/ies and
endorsements contemplated above;
(v) evidence reasonably acceptable to the Collateral Agent of
payment by U.S. Borrower of all Title Policy premiums, search and
examination charges, escrow charges and related charges, mortgage
recording taxes, fees, charges, costs and expenses required for the
recording of the Mortgages and issuance of the Title Policies referred to
above;
(vi) with respect to each Real Property or Mortgaged Property,
copies of all Leases in which U.S. Borrower or any Subsidiary holds the
lessor's interest or other agreements relating to possessory interests, if
any. To the extent any of the foregoing affect any Mortgaged Property,
such agreement shall be subordinate to the Lien of the Mortgage to be
recorded against such Mortgaged Property, either expressly by its terms or
pursuant to a subordination, non-disturbance and attornment agreement, and
shall otherwise be acceptable to the Collateral Agent;
(vii) with respect to each Mortgaged Property, each Company shall
have made all notifications, registrations and filings, to the extent
required by, and in accordance with, all Governmental Real Property
Disclosure Requirements applicable to such Mortgaged Property; and
(viii) Surveys with respect to each Mortgaged Property.
(p) INSURANCE. The Administrative Agent shall have received a copy
of, or a certificate as to coverage under, the insurance policies required by
SECTION 5.04 and the applicable provisions of the Security Documents, each of
which shall be endorsed or otherwise amended to include a "standard" or
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"New York" lender's loss payable or mortgagee endorsement (as applicable) and
shall name the Collateral Agent, on behalf of the Secured Parties, as additional
insured, in form and substance satisfactory to the Administrative Agent.
(q) NO MATERIAL CHANGE. No change shall have occurred since
October 4, 2003, and no additional information shall be disclosed to or
discovered by the Administrative Agent (including, without limitation,
information contained in any review or report required to be provided to it in
connection with this Agreement), which the Administrative Agent determines has
had or could reasonably be expected to have a material adverse effect on the
business, results of operations, condition (financial or otherwise), assets or
liabilities of Parent, U.S. Borrower and their respective subsidiaries taken as
a whole.
SECTION 4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation
of each Lender and each Issuing Bank to make any Credit Extension (including the
initial Credit Extension) shall be subject to, and to the satisfaction of, each
of the conditions precedent set forth below.
(a) NOTICE. The Administrative Agent shall have received a
Borrowing Request as required by Section 2.03 (or such notice shall have
been deemed given in accordance with SECTION 2.03) if Loans are being
requested or, in the case of the issuance, amendment, extension or renewal
of a Letter of Credit, the Issuing Bank and the Administrative Agent shall
have received a notice requesting the issuance, amendment, extension or
renewal of such Letter of Credit as required by SECTION 2.18(b) or, in the
case of the Borrowing of a Swingline Loan, the Swingline Lender and the
Administrative Agent shall have received a U.S. Borrowing Request as
required by SECTION 2.17(b).
(b) NO DEFAULT. The Borrowers and each other Loan Party shall be
in compliance in all material respects with all the terms and provisions
set forth herein and in each other Loan Document on its part to be
observed or performed, and, at the time of and immediately after giving
effect to such Credit Extension and the application of the proceeds
thereof, no Default shall have occurred and be continuing on such date.
(c) REPRESENTATIONS AND WARRANTIES. Each of the representations
and warranties made by any Loan Party set forth in ARTICLE III hereof
(other than, in the case of the initial Credit Extension only, SECTION
3.04(d)) or in any other Loan Document shall be true and correct in all
material respects (except that any representation and warranty that is
qualified as to "materiality" or "Material Adverse Effect" shall be true
and correct in all respects) on and as of the date of such Credit
Extension with the same effect as though made on and as of such date,
except to the extent such representations and warranties expressly relate
to an earlier date.
(d) NO LEGAL BAR. No order, judgment or decree of any Governmental
Authority shall purport to restrain any Lender from making any Loans to be
made by it. No injunction or other restraining order shall have been
issued, shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of, or
to recover any damages or obtain relief as a result of, the transactions
contemplated by this Agreement or the making of Loans hereunder.
Each of the delivery of a Borrowing Request or notice requesting the
issuance, amendment, extension or renewal of a Letter of Credit and the
acceptance by a Borrower of the proceeds of such Credit Extension shall
constitute a representation and warranty by such Borrower and each other Loan
Party that on the date of such Credit Extension (both immediately before and
after giving effect to such Credit Extension and the application of the proceeds
thereof) the conditions contained in this SECTION 4.02 have been satisfied. Each
Borrower shall provide such information (including calculations in reasonable
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detail of the covenants in SECTION 6.10) as the Administrative Agent may
reasonably request to confirm that the conditions in this SECTION 4.02 have been
satisfied.
ARTICLE V
AFFIRMATIVE COVENANTS
Each Loan Party warrants, covenants and agrees with each Lender that so
long as this Agreement shall remain in effect and until the Commitments have
been terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document shall have been paid
in full and all Letters of Credit have been canceled or have expired and all
amounts drawn thereunder have been reimbursed in full, unless the Required
Lenders shall otherwise consent in writing, each Loan Party will, and will cause
each of its Subsidiaries to:
SECTION 5.01 FINANCIAL STATEMENTS, REPORTS, ETC. Furnish to the
Administrative Agent and each Lender:
(a) ANNUAL REPORTS. As soon as available and in any event within
90 days after the end of each fiscal year (but no later than the date on
which Parent would be required to file a Form 10-K under the Exchange Act
if it were subject to Section 15 and 13(d) of the Exchange Act), (i) the
consolidated balance sheet of Parent as of the end of such fiscal year and
related consolidated statements of income, cash flows and stockholders'
equity for such fiscal year, in comparative form with such financial
statements as of the end of, and for, the preceding fiscal year, and notes
thereto (including a note with a consolidating balance sheet and
statements of income and cash flows separating out Parent, U.S. Borrower
and the Subsidiaries), all prepared in accordance with Regulation S-X and
accompanied by an opinion of Ernst & Young LLP or other independent public
accountants of recognized national standing reasonably satisfactory to the
Administrative Agent (which opinion shall not be qualified as to scope or
contain any going concern or other qualification), stating that such
financial statements fairly present, in all material respects, the
consolidated financial condition, results of operations and cash flows of
Parent as of the dates and for the periods specified in accordance with
GAAP and (ii) a management's discussion and analysis of the financial
condition and results of operations for such fiscal year, including a
discussion of sales by product category, as compared to the previous
fiscal year and budgeted amounts (it being understood that the information
required by clause (i) may be furnished in the form of a Form 10-K);
(b) QUARTERLY REPORTS. As soon as available and in any event
within 45 days after the end of each of the first three fiscal quarters of
each fiscal year (but no later than the date on which Parent would be
required to file a Form 10-Q under the Exchange Act if it were subject to
Section 15 and 13(d) of the Exchange Act), (i) the consolidated balance
sheet of Parent as of the end of such fiscal quarter and related
consolidated statements of income and cash flows for such fiscal quarter
and for the then elapsed portion of the fiscal year, in comparative form
with the consolidated statements of income and cash flows for the
comparable periods in the previous fiscal year, and notes thereto
(including a note with a consolidating balance sheet and statements of
income and cash flows separating out Parent, U.S. Borrower and the
Subsidiaries), all prepared in accordance with Regulation S-X under the
Securities Act and accompanied by a certificate of a Financial Officer
stating that such financial statements fairly present, in all material
respects, the consolidated financial condition, results of operations and
cash flows of Parent as of the date and for the periods specified in
accordance with GAAP consistently applied, and on a basis consistent with
audited financial statements referred to in clause (a) of this Section,
subject to normal year-end audit adjustments and (ii) a management's
discussion and analysis of the financial condition
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and results of operations for such fiscal quarter and the then elapsed
portion of the fiscal year, including a discussion of sales by product
category, as compared to the comparable periods in the previous fiscal
year and budgeted amounts (it being understood that the information
required by clause (i) may be furnished in the form of a Form 10-Q);
(c) FINANCIAL OFFICER'S CERTIFICATE. (i) Concurrently with any
delivery of financial statements under SECTION 5.01(a) or (b) above, a
Compliance Certificate certifying that no Default has occurred or, if such
a Default has occurred, specifying the nature and extent thereof and any
corrective action taken or proposed to be taken with respect thereto; (ii)
concurrently with any delivery of financial statements under SECTION 5.01
(a) or (b) above, a Compliance Certificate setting forth computations in
reasonable detail satisfactory to the Administrative Agent demonstrating
compliance with the covenants contained in SECTIONS 6.07(f) and 6.10
(including the aggregate amount of Excluded Issuances for such period and
the uses therefor) and, in the case of SECTION 5.01(a) above, setting
forth U.S. Borrower's calculation of Excess Cash Flow; and (iii) in the
case of SECTION 5.01(a) above, a report of the accounting firm opining on
or certifying such financial statements stating that in the course of its
regular audit of the financial statements of Parent and its Subsidiaries,
which audit was conducted in accordance with GAAP, such accounting firm
obtained no knowledge that any Default insofar as it relates to financial
or accounting matters has occurred or, if in the opinion of such
accounting firm such a Default has occurred, specifying the nature and
extent thereof;
(d) FINANCIAL OFFICER'S CERTIFICATE REGARDING COLLATERAL.
Concurrently with any delivery of financial statements under SECTION
5.01(a) above, a certificate of a Financial Officer setting forth the
information required pursuant to the Perfection Certificate Supplement or
confirming that there has been no change in such information since the
date of the Perfection Certificate or latest Perfection Certificate
Supplement;
(e) PUBLIC REPORTS. Promptly after the same become publicly
available, copies of all periodic and other reports, proxy statements and
other materials filed by any Company with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of said Commission, or with any national securities exchange, or
distributed to holders of its Indebtedness pursuant to the terms of the
documentation governing such Indebtedness (or any trustee, agent or other
representative therefor), as the case may be;
(f) MANAGEMENT LETTERS. Promptly after the receipt thereof by any
Company, a copy of any final "management letter" received by any such
person from its certified public accountants and the management's
responses thereto;
(g) BUDGETS. No later than 30 days after the first day of each
fiscal year of Parent and U.S. Borrower, a budget in form reasonably
satisfactory to the Administrative Agent (including budgeted statements of
income for each of U.S. Borrower's business units and sources and uses of
cash and balance sheets and a projection of sales by product category)
prepared by each of Parent and U.S. Borrower, respectively, for each
quarter of such fiscal year prepared in summary form, in each case, of
Parent, Borrower and their respective subsidiaries, with appropriate
presentation and discussion of the principal assumptions upon which such
budgets are based, accompanied by the statement of a Financial Officer of
each of Parent and U.S. Borrower to the effect that the budget of Parent
and U.S. Borrower, respectively, is a reasonable estimate for the period
covered thereby and, promptly when available, any significant revisions of
such budget;
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(h) ORGANIZATION. Within 90 days after the close of each fiscal
year of Parent, Parent shall deliver an accurate organization chart as
required by SECTION 3.07(c), or confirm that there are no changes to
SCHEDULE 3.07(c);
(i) ORGANIZATIONAL DOCUMENTS. Promptly provide copies of any
Organizational Documents that have been amended or modified in accordance
with the terms hereof and deliver a copy of any notice of default given or
received by any Company under any Organizational Document within 15 days
after such Company gives or receives such notice; and
(j) OTHER INFORMATION. Promptly, from time to time, such other
information regarding the operations, business affairs and financial
condition of any Company, or compliance with the terms of any Loan
Document, as the Administrative Agent or any Lender may reasonably
request.
SECTION 5.02 LITIGATION AND OTHER NOTICES. Furnish to the
Administrative Agent and each Lender written notice of the following promptly
(and, in any event, within three Business Days of any Company becoming aware
thereof):
(a) any Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect
thereto;
(b) the filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit, litigation
or proceeding, whether at law or in equity by or before any Governmental
Authority, (i) against any Company or any Affiliate thereof that could
reasonably be expected to result in a Material Adverse Effect or (ii) with
respect to any Loan Document;
(c) any development that has resulted in, or could reasonably be
expected to result in a Material Adverse Effect;
(d) the occurrence of a Casualty Event in excess of $5.0 million;
and
(e) (i) the incurrence of any material Lien (other than Permitted
Collateral Liens) on, or claim asserted against any of the Collateral or
(ii) the occurrence of any other event which could materially affect the
value of the Collateral.
SECTION 5.03 EXISTENCE; BUSINESSES AND PROPERTIES. (a) Do or cause
to be done all things necessary to preserve, renew and maintain in full force
and effect its legal existence, except as otherwise expressly permitted under
SECTION 6.05 or SECTION 6.06 or, in the case of any Subsidiary, where the
failure to perform such obligations, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
(b) Do or cause to be done all things necessary to obtain,
preserve, renew, extend and keep in full force and effect the rights, licenses,
permits, privileges, franchises, authorizations, patents, copyrights, trademarks
and trade names material to the conduct of its business; comply with all
applicable Requirements of Law (including any and all zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Real Property) and decrees
and orders of any Governmental Authority, whether now in effect or hereafter
enacted, except where the failure to comply, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect; pay and
perform its obligations under all Leases and Transaction Documents except, in
the case of all such documents other than the Loan Documents, where the
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failure to comply, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect; and at all times maintain,
preserve and protect all property material to the conduct of such business and
keep such property in good repair, working order and condition (other than wear
and tear occurring in the ordinary course of business) and from time to time
make, or cause to be made, all needful and proper repairs, renewals, additions,
improvements and replacements thereto necessary in order that the business
carried on in connection therewith may be properly conducted at all times;
PROVIDED that nothing in this SECTION 5.03(b) shall prevent (i) sales of
property, consolidations or mergers by or involving any Company in accordance
with SECTION 6.05 or SECTION 6.06; (ii) the withdrawal by any Company of its
qualification as a foreign corporation in any jurisdiction where such
withdrawal, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect; or (iii) the abandonment by any Company
of any rights, franchises, licenses, trademarks, trade names, copyrights or
patents that such person reasonably determines are not useful to its business or
no longer commercially desirable.
SECTION 5.04 INSURANCE. (a) Keep its insurable property adequately
insured at all times by financially sound and reputable insurers; maintain such
other insurance, to such extent and against such risks as is customary with
companies in the same or similar businesses operating in the same or similar
locations, including insurance with respect to Mortgaged Properties and other
properties material to the business of the Companies against such casualties and
contingencies and of such types and in such amounts with such deductibles as is
customary in the case of similar businesses operating in the same or similar
locations, including (i) physical hazard insurance on an "all risk" basis, (ii)
commercial general liability against claims for bodily injury, death or property
damage covering any and all insurable claims, (iii) explosion insurance in
respect of any boilers, machinery or similar apparatus constituting Collateral,
(iv) business interruption insurance, (v) worker's compensation insurance and
such other insurance as may be required by any Requirement of Law and (vi) such
other insurance against risks as the Administrative Agent may from time to time
require (such policies to be in such form and amounts and having such coverage
as may be reasonably satisfactory to the Administrative Agent and the Collateral
Agent); PROVIDED that with respect to physical hazard insurance, neither the
Collateral Agent nor the applicable Company shall agree to the adjustment of any
claim thereunder without the consent of the other (such consent not to be
unreasonably withheld or delayed); PROVIDED, FURTHER, that no consent of any
Company shall be required during an Event of Default.
(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the Collateral Agent of
written notice thereof, (ii) name the Collateral Agent as mortgagee (in the case
of property insurance) or additional insured on behalf of the applicable Secured
Parties (in the case of liability insurance) or loss payee (in the case of
property insurance), as applicable, (iii) if reasonably requested by the
Collateral Agent, include a breach of warranty clause and (iv) be reasonably
satisfactory in all other respects to the Collateral Agent.
(c) Notify the Administrative Agent and the Collateral Agent
immediately whenever any separate insurance concurrent in form or contributing
in the event of loss with that required to be maintained under this SECTION 5.04
is taken out by any Company; and promptly deliver to the Administrative Agent
and the Collateral Agent a duplicate original copy of such policy or policies.
(d) With respect to each U.S. Mortgaged Property, obtain flood
insurance in such total amount as the Administrative Agent or the Required
Lenders may from time to time require, if at any time the area in which any
improvements located on any Mortgaged Property is designated a "flood hazard
area" in any Flood Insurance Rate Map published by the Federal Emergency
Management Agency (or any successor agency), and otherwise comply with the
National Flood Insurance Program as set forth in the Flood Disaster Protection
Act of 1973, as amended from time to time.
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(e) Deliver to the Administrative Agent and the Collateral Agent
and the Lenders a report of a reputable insurance broker with respect to such
insurance and such supplemental reports with respect thereto as the
Administrative Agent or the Collateral Agent may from time to time reasonably
request.
(f) No Loan Party that is an owner of Mortgaged Property shall
take any action that is reasonably likely to be the basis for termination,
revocation or denial of any insurance coverage required to be maintained under
such Loan Party's respective Mortgage or that could be the basis for a defense
to any claim under any Insurance Policy maintained in respect of the Premises,
and each Loan Party shall otherwise comply in all material respects with all
Insurance Requirements in respect of the Premises; PROVIDED, HOWEVER, that each
Loan Party may, at its own expense and after written notice to the
Administrative Agent, (i) contest the applicability or enforceability of any
such Insurance Requirements by appropriate legal proceedings, the prosecution of
which does not constitute a basis for cancellation or revocation of any
insurance coverage required under this SECTION 5.04 or (ii) cause the Insurance
Policy containing any such Insurance Requirement to be replaced by a new policy
complying with the provisions of this SECTION 5.04.
SECTION 5.05 OBLIGATIONS AND TAXES. (a) Pay its material
Indebtedness and other material obligations promptly and in accordance with
their terms and pay and discharge promptly when due all Taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
in respect of its property, before the same shall become delinquent or in
default, as well as all lawful claims for labor, services, materials and
supplies or otherwise that, if unpaid, might give rise to a Lien other than a
Permitted Lien upon such properties or any part thereof; PROVIDED that such
payment and discharge shall not be required with respect to any such Tax,
assessment, charge, levy or claim so long as (i) the validity or amount thereof
shall be contested in good faith by appropriate proceedings timely instituted
and diligently conducted and the applicable Company shall have set aside on its
books adequate reserves or other appropriate provisions with respect thereto in
accordance with GAAP and such contested amounts, individually or in the
aggregate, are not reasonably expected to have a Material Adverse Effect, (ii)
such contest operates to suspend collection of the contested obligation, Tax,
assessment or charge and enforcement of a Lien other than a Permitted Lien and
(iii) in the case of Collateral, the applicable Company shall have otherwise
complied with the Contested Collateral Lien Conditions.
(b) Timely and correctly file all material Tax Returns required to
be filed by it. Withhold, collect and remit all Taxes that it is required to
collect, withhold or remit.
(c) U.S. Borrower does not intend to treat the Loans as being a
"reportable transaction" within the meaning of Treasury Regulation Section
1.6011-4. In the event U.S. Borrower determines to take any action inconsistent
with such intention, it will promptly notify the Administrative Agent thereof.
SECTION 5.06 EMPLOYEE BENEFITS. (a) Comply in all material
respects with the applicable provisions of ERISA and the Code and (b) furnish to
the Administrative Agent (x) as soon as possible after, and in any event within
10 days after any Responsible Officer of any Company or any ERISA Affiliates of
any Company knows or has reason to know that, any ERISA Event has occurred that,
alone or together with any other ERISA Event could reasonably be expected to
result in liability of the Companies or any of their ERISA Affiliates in an
aggregate amount exceeding $1.0 million or the imposition of a Lien, a statement
of a Financial Officer of U.S. Borrower setting forth details as to such ERISA
Event and the action, if any, that the Companies propose to take with respect
thereto, and (y) upon request by the Administrative Agent, copies of (i) each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed
by any Company or any ERISA Affiliate with the Internal Revenue Service with
respect to each Plan; (ii) the most recent actuarial valuation report for each
Plan; (iii) all notices received
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by any Company or any ERISA Affiliate from a Multiemployer Plan sponsor or any
governmental agency concerning an ERISA Event; and (iv) such other documents or
governmental reports or filings relating to any Plan (or employee benefit plan
sponsored or contributed to by any Company) as the Administrative Agent shall
reasonably request.
SECTION 5.07 MAINTAINING RECORDS; ACCESS TO PROPERTIES AND
INSPECTIONS; ANNUAL MEETINGS. (a) Keep proper books of record and account in
which full, true and correct entries in conformity with GAAP and all
Requirements of Law are made of all dealings and transactions in relation to its
business and activities. Each Company will permit any representatives designated
by the Administrative Agent or any Lender to visit and inspect the financial
records and the property of such Company at reasonable times and as often as
reasonably requested and to make extracts from and copies of such financial
records, and permit any representatives designated by the Administrative Agent
or any Lender to discuss the affairs, finances, accounts and condition of any
Company with the officers and employees thereof and advisors therefor (including
independent accountants).
(b) Within 120 days after the close of each fiscal year of the
Companies, at the request of the Administrative Agent or Required Lenders, hold
a meeting (at a mutually agreeable location and time or, at the option of the
Administrative Agent, by conference call) with all Lenders who choose to attend
such meeting at which meeting shall be reviewed the financial results of the
previous fiscal year and the financial condition of the Companies and the
budgets presented for the current fiscal year of the Companies.
SECTION 5.08 USE OF PROCEEDS. Use the proceeds of the Loans only
for the purposes set forth in SECTION 3.12 and request the issuance of Letters
of Credit only for the purposes set forth in the definition of Commercial Letter
of Credit or Standby Letter of Credit, as the case may be.
SECTION 5.09 COMPLIANCE WITH ENVIRONMENTAL LAWS; ENVIRONMENTAL
REPORTS. (a) Comply, and cause all lessees and other persons occupying Real
Property owned, operated or leased by any Company to comply, in all material
respects with all Environmental Laws and Environmental Permits applicable to its
operations and Real Property; obtain and renew all material Environmental
Permits applicable to its operations and Real Property; and conduct all
Responses required by, and in accordance with, Environmental Laws; PROVIDED that
no Company shall be required to undertake any Response to the extent that its
obligation to do so is being contested in good faith and by proper proceedings
and appropriate reserves are being maintained with respect to such circumstances
in accordance with GAAP.
(b) If a Default caused by reason of a breach of SECTION 3.18 or
SECTION 5.09(a) shall have occurred and be continuing for more than 20 days
without the Companies commencing activities reasonably likely to cure such
Default, at the written request of the Administrative Agent or the Required
Lenders through the Administrative Agent, provide to the Lenders within 45 days
after such request, at the expense of U.S. Borrower, an environmental assessment
report regarding the matters which are the subject of such Default, including,
where appropriate, any soil and/or groundwater sampling, prepared by an
environmental consulting firm and, in the form and substance, reasonably
acceptable to the Administrative Agent and indicating the presence or absence of
Hazardous Materials and the estimated cost of any compliance or Response to
address them.
(c) Each Loan Party that is an owner of Mortgaged Property shall
not install nor permit to be installed in the Mortgaged Property any Hazardous
Materials, other than in compliance with applicable Environmental Laws.
SECTION 5.10 ADDITIONAL COLLATERAL; ADDITIONAL GUARANTORS. (a)
Subject to this SECTION 5.10, with respect to any property acquired after the
Closing Date by any Loan Party that is
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intended to be subject to the Lien created by any of the Security Documents but
is not so subject, promptly (and in any event within 30 days after the
acquisition thereof) (i) execute and deliver to the Administrative Agent and the
Collateral Agent such amendments or supplements to the relevant Security
Documents or such other documents as the Administrative Agent or the Collateral
Agent shall deem reasonably necessary or advisable to grant to the Collateral
Agent, for its benefit and for the benefit of the other applicable Secured
Parties, a Lien on such property subject to no Liens other than Permitted
Collateral Liens, and (ii) take all actions necessary to cause such Lien to be
duly perfected to the extent required by such Security Document in accordance
with all applicable Requirements of Law, including the filing of financing
statements in such jurisdictions as may be reasonably requested by the
Administrative Agent. The Borrowers shall otherwise take such actions and
execute and/or deliver to the Collateral Agent such documents as the
Administrative Agent or the Collateral Agent shall reasonably require to confirm
the validity, perfection and priority of the Lien of the Security Documents
against such after-acquired properties.
(b) With respect to any person that is or becomes a U.S.
Subsidiary after the Closing Date, promptly (and in any event within 30 days
after such person becomes a U.S. Subsidiary) (i) deliver to the Collateral Agent
the certificates, if any, representing all of the Equity Interests of such U.S.
Subsidiary owned by Parent or any of its Subsidiaries, together with undated
stock powers or other appropriate instruments of transfer executed and delivered
in blank by a duly authorized officer of the holder(s) of such Equity Interests,
and all intercompany notes owing from such U.S. Subsidiary to any Loan Party
together with instruments of transfer executed and delivered in blank by a duly
authorized officer of such Loan Party and (ii) cause such new U.S. Subsidiary
(A) to execute a Joinder Agreement or such comparable documentation to become a
U.S. Subsidiary Guarantor and a joinder agreement to the U.S. Security
Agreement, substantially in the form annexed thereto or, in the case of a
Foreign Subsidiary (other than a Canadian Subsidiary), execute a security
agreement compatible with the laws of such Foreign Subsidiary's jurisdiction in
form and substance reasonably satisfactory to the Administrative Agent, and (B)
to take all actions necessary or advisable in the opinion of the Administrative
Agent or the Collateral Agent to cause the Lien created by the U.S. Security
Agreement to be duly perfected to the extent required by such agreement in
accordance with all applicable Requirements of Law, including the filing of
financing statements in such jurisdictions as may be reasonably requested by the
Administrative Agent or the Collateral Agent. Notwithstanding the foregoing, (1)
the Equity Interests required to be delivered to the Collateral Agent pursuant
to clause (i) of this SECTION 5.10(b) shall not include any Equity Interests of
a Foreign Subsidiary created or acquired after the Closing Date and (2) no
Foreign Subsidiary shall be required to take the actions specified in clause
(ii) of this SECTION 5.10(b), if, in the case of either clause (1) or (2), doing
so would constitute an investment of earnings in United States property under
Section 956 (or a successor provision) of the Code, which investment would or
could reasonably be expected to trigger a NON DE MINIMIS increase in the net
income of a United States shareholder of such Subsidiary pursuant to Section 951
(or a successor provision) of the Code, as reasonably determined by the
Administrative Agent; PROVIDED that this exception shall not apply to (A) Voting
Stock of any Subsidiary which is a first-tier controlled foreign corporation (as
defined in Section 957(a) of the Code) representing 65% of the total voting
power of all outstanding Voting Stock of such Subsidiary and (B) 100% of the
Equity Interests not constituting Voting Stock of any such Subsidiary, except
that any such Equity Interests constituting "stock entitled to vote" within the
meaning of Treasury Regulation Section 1.956-2(c)(2) shall be treated as Voting
Stock for purposes of this SECTION 5.10(b).
(c) With respect to any person that is or becomes a Canadian
Subsidiary after the Closing Date, promptly (and in any event within 30 days
after such person becomes a Canadian Subsidiary) (i) deliver to the Collateral
Agent, a pledge agreement in a form reasonably satisfactory to the Collateral
Agent, the certificates, if any, representing all of the Equity Interests of
such Canadian Subsidiary owned by Canadian Borrower or a Canadian Subsidiary,
together with undated stock powers or other appropriate instruments of transfer
executed and delivered in blank by a duly authorized officer of the
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holder(s) of such Equity Interests, and all intercompany notes owing from such
Canadian Subsidiary to any Loan Party together with instruments of transfer
executed and delivered in blank by a duly authorized officer of such Loan Party
and (ii) cause such new Subsidiary (A) to execute a Joinder Agreement or such
comparable documentation to become a Canadian Subsidiary Guarantor and a joinder
agreement to the Canadian Security Agreement, substantially in the form annexed
thereto or, in the case of a Subsidiary not organized under the laws of Canada,
execute a security agreement compatible with the laws of such Subsidiary's
jurisdiction in form and substance reasonably satisfactory to the Administrative
Agent, and (B) to take all actions necessary or advisable in the opinion of the
Administrative Agent or the Collateral Agent to cause the Lien created by such
security document to be duly perfected to the extent required by such agreement
in accordance with all applicable Requirements of Law, including the filing of
financing statements in such jurisdictions as may be reasonably requested by the
Administrative Agent or the Collateral Agent.
(d) Promptly grant to the Collateral Agent, within 60 days of the
acquisition thereof, a security interest in and Mortgage on (i) each Real
Property owned in fee by such U.S. Loan Party as is acquired by such U.S. Loan
Party after the Closing Date and that, together with any improvements thereon,
individually has a fair market value of at least $1.0 million, and (ii) unless
the Collateral Agent otherwise consents, each leased Real Property of such U.S.
Loan Party which lease individually has a fair market value of at least $1.0
million, in each case, as additional security for the Obligations (unless the
subject property is already mortgaged to a third party to the extent permitted
by SECTION 6.02). Such Mortgages shall be granted pursuant to documentation
reasonably satisfactory in form and substance to the Administrative Agent and
the Collateral Agent and shall constitute valid and enforceable perfected Liens
subject only to Permitted Collateral Liens or other Liens acceptable to the
Collateral Agent. The Mortgages or instruments related thereto shall be duly
recorded or filed in such manner and in such places as are required by law to
establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Mortgages and all taxes, fees and
other charges payable in connection therewith shall be paid in full. Such U.S.
Loan Party shall otherwise take such actions and execute and/or deliver to the
Collateral Agent such documents as the Administrative Agent or the Collateral
Agent shall require to confirm the validity, perfection and priority of the Lien
of any existing Mortgage or new Mortgage against such after-acquired Real
Property (including a Title Policy, a Survey and local counsel opinion (in form
and substance reasonably satisfactory to the Administrative Agent and the
Collateral Agent) in respect of such Mortgage).
(e) Promptly grant to the Collateral Agent, within 60 days of the
acquisition thereof, a security interest in and Mortgage creating a Lien on (i)
each Real Property owned in fee by such Canadian Loan Party as is acquired by
such Canadian Loan Party after the Closing Date and that, together with any
improvements thereon, individually has a fair market value of at least $1.0
million, and (ii) unless the Collateral Agent otherwise consents, each leased
Real Property of such Canadian Loan Party which lease individually has a fair
market value of at least $1.0 million, in each case, as additional security for
the Obligations (unless the subject property is already mortgaged to a third
party to the extent permitted by SECTION 6.02). Such Mortgages shall be granted
pursuant to documentation reasonably satisfactory in form and substance to the
Administrative Agent and the Collateral Agent and shall constitute valid and
enforceable perfected Liens subject only to Permitted Collateral Liens or other
Liens acceptable to the Collateral Agent. The Mortgages or instruments related
thereto shall be duly recorded or filed in such manner and in such places as are
required by law to establish, perfect, preserve and protect the Liens in favor
of the Collateral Agent required to be granted pursuant to the Mortgages and all
taxes, fees and other charges payable in connection therewith shall be paid in
full. Such Canadian Loan Party shall otherwise take such actions and execute
and/or deliver to the Collateral Agent such documents as the Administrative
Agent or the Collateral Agent shall require to confirm the validity, perfection
and priority of the Lien of any existing Mortgage or new Mortgage against such
after-acquired Real Property (including a Title Policy (if available in the
relevant jurisdiction), Survey and local counsel opinion (including as to
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title if a Title Policy is unavailable and otherwise in form and substance
reasonably satisfactory to the Administrative Agent and the Collateral Agent) in
respect of such Mortgage).
(f) The parties hereto agree that the provisions of this SECTION
5.10 (other than this Section 5.10(f)) shall not apply to Non-Guarantor
Subsidiaries. Either Borrower may designate any of its Subsidiaries acquired or
formed after the Closing Date as a Non-Guarantor Subsidiary by written notice to
the Administrative Agent; PROVIDED, HOWEVER, that if at any time any
Non-Guarantor Subsidiary or group of Non-Guarantor Subsidiaries in the aggregate
(other than any Foreign Subsidiary that is not required to take the actions
specified in SECTION 5.10(b)(ii) by operation of the last sentence of SECTION
5.10(b)) not otherwise subject to SECTION 5.10(b) has assets with either a book
value or fair market value in excess of $1.0 million, then such Borrower shall,
and shall cause one or more of such Subsidiaries to, comply with SECTION 5.10(b)
within the time frames set forth therein so that no Non-Guarantor Subsidiary or
group of Non-Guarantor Subsidiaries in the aggregate holds property having
either a book value or fair market value in excess of $1.0 million.
SECTION 5.11 SECURITY INTERESTS; FURTHER ASSURANCES. Promptly,
upon the reasonable request of the Administrative Agent, the Collateral Agent or
any Lender, at U.S. Borrower's expense, execute, acknowledge and deliver, or
cause the execution, acknowledgment and delivery of, and thereafter register,
file or record, or cause to be registered, filed or recorded, in an appropriate
governmental office, any document or instrument supplemental to or confirmatory
of the Security Documents or otherwise deemed by the Administrative Agent or the
Collateral Agent reasonably necessary or desirable for the continued validity,
perfection and priority of the Liens on the Collateral covered thereby subject
to no other Liens except as permitted by the applicable Security Document, or
obtain any consents or waivers as may be necessary or appropriate in connection
therewith. Deliver or cause to be delivered to the Administrative Agent and the
Collateral Agent from time to time such other documentation, consents,
authorizations, approvals and orders in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent as the
Administrative Agent and the Collateral Agent shall reasonably deem necessary to
perfect or maintain the Liens on the Collateral pursuant to the Security
Documents. Upon the exercise by the Administrative Agent, the Collateral Agent
or the Required Lenders of any power, right, privilege or remedy pursuant to any
Loan Document which requires any consent, approval, registration, qualification
or authorization of any Governmental Authority execute and deliver all
applications, certifications, instruments and other documents and papers that
the Administrative Agent, the Collateral Agent or the Required Lenders may
require. If the Administrative Agent, the Collateral Agent or the Required
Lenders reasonably determine that they are required by law or regulation to have
appraisals prepared in respect of the Real Property of any Loan Party
constituting Collateral, the Borrowers shall provide to the Administrative Agent
appraisals that satisfy the applicable requirements of the Real Estate Appraisal
Reform Amendments of FIRREA or other applicable law and are otherwise in form
and substance reasonably satisfactory to the Administrative Agent and the
Collateral Agent.
SECTION 5.12 INFORMATION REGARDING COLLATERAL. (a) Not effect any
change (i) in any Loan Party's legal name, (ii) in the location of any Loan
Party's chief executive office, (iii) in any Loan Party's identity or
organizational structure, (iv) in any Loan Party's Federal Taxpayer
Identification Number or organizational identification number, if any, (v) in
any Loan Party's jurisdiction of organization (in each case, including by
merging with or into any other entity, reorganizing, dissolving, liquidating,
reorganizing or organizing in any other jurisdiction) or (vi) in the case of
tangible personal property in Canada, the Province in which such property is
located, unless a PPSA financing statement has already been filed in respect of
the Loan Party in the province to which the property is re-located until (A) it
shall have given the Collateral Agent and the Administrative Agent not less than
30 days' prior written notice (in the form of an Officers' Certificate), or such
lesser notice period agreed to by the Collateral Agent, of its intention so to
do, clearly describing such change and providing such other information in
connection therewith as the Collateral Agent or the Administrative Agent may
reasonably request
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and (B) it shall have taken all action reasonably satisfactory to the Collateral
Agent to maintain the perfection and priority of the security interest of the
Collateral Agent for the benefit of the Secured Parties in the Collateral, if
applicable. Each Loan Party agrees to promptly provide the Collateral Agent with
certified Organizational Documents reflecting any of the changes described in
the preceding sentence. Each Loan Party also agrees to promptly notify the
Collateral Agent of any change in the location of any office in which it
maintains books or records relating to Collateral owned by it or any office or
facility at which Collateral is located (including the establishment of any such
new office or facility), other than changes in location to a Mortgaged Property
or a leased property subject to a Landlord Access Agreement.
(b) Concurrently with the delivery of financial statements
pursuant to SECTION 5.01(a), deliver to the Administrative Agent and the
Collateral Agent a Perfection Certificate Supplement and a certificate of a
Financial Officer and the chief legal officer of U.S. Borrower certifying that
all UCC financing statements (including fixture filings, as applicable) or other
appropriate filings, recordings or registrations, including all refilings,
rerecordings and reregistrations, containing a description of the Collateral
have been filed of record in each governmental, municipal or other appropriate
office in each jurisdiction necessary to protect and perfect the security
interests and Liens under the Security Documents for a period of not less than
18 months after the date of such certificate (except as noted therein with
respect to any continuation statements to be filed within such period).
SECTION 5.13 POST-CLOSING MATTERS. (a) The applicable Loan Parties
shall use their commercially reasonable efforts to obtain and deliver to the
Collateral Agent (unless waived or extended by the Collateral Agent in its
discretion), within the time periods set forth below, to the extent such items
have not provided as of the Closing Date, the following:
(i) Landlord Access Agreements for the Real Properties located at
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, MD; ▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇; ▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇; and ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, each in form and substance reasonably acceptable to the Collateral
Agent, unless the Collateral Agent, in its reasonable judgment, waives
such delivery, with respect to each of the leased Real Properties set
forth in this clause (i), within forty-five (45) days after the Closing
Date;
(ii) the property owners' consents to leasehold mortgage financing,
on terms and conditions reasonably satisfactory to the Collateral Agent,
with respect to the property located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇, within forty five (45) days after the Closing Date, and if such
consent is so obtained, the applicable Loan Party will deliver to
Collateral Agent, within thirty (30) days thereafter, with respect to the
same, the following:
(1) a duly executed and acknowledged Mortgage, financing
statements and other instruments meeting the requirements of Section
4.01(o)(i) hereof;
(2) such consents, approvals, amendments, supplements,
estoppels, tenant subordination agreements or other instruments as
required by Section 4.01(o)(ii);
(3) a policy of title insurance meeting the requirements
of Section 4.01(o)(iii);
(4) policies or certificates of insurance as required by
Section 4.01(p);
(5) a Survey meeting the requirements of the definition
of "Survey" contained in this Agreement;
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(6) such affidavits, certificates, information (including
financial data) and instruments of indemnification (including, without
limitation, a so-called "gap" indemnification) as required by Section
4.01(o)(iv);
(7) evidence of payment of all applicable premiums,
charges, costs, taxes, etc. as required by Section 4.01(o)(v);
(8) copies of all leases or other agreements, and
subordination of such, as required by Section 4.01(o)(vi);
(9) the notices, registration and filings required by
Section 4.01(o)(vii); and
(10) favorable written opinions of local counsel in the
states in which each such Real Property is located, as required by
Section 4.01(g);
and if such consent to leasehold mortgage financing, set forth in this
Section 5.13(a)(ii), is so obtained, the Mortgage and policy of title
insurance referred to in clauses (1) and (3), respectively, shall be in
the amount of $1,109,750; and
(iii) consents to mortgage, or other secured, financing (which
consents shall be in form and substance reasonably satisfactory to the
Collateral Agent) of Napco, Inc.'s interest, as contract purchaser, under
that certain Installment Sale Agreement dated April 16, 1996 between
Napco, Inc. and the Community Development Corporation of ▇▇▇▇▇▇ County,
Pennsylvania ("CDC") (as seller thereunder) providing for the sale of
certain premises (the "BUTLER PROPERTY") located in Butler, Pennsylvania
and more particularly described in a Memorandum of Installment Sale
Agreement dated April 16, 1996 and recorded in the Recorder's Office of
▇▇▇▇▇▇ County, Pennsylvania on April 19, 1996 in Book 2618 at Page 629
(the "INSTALLMENT CONTRACT"), from (x) CDC under the Installment Contract
and any related documentation, (y) The Pennsylvania Industrial Development
Authority, as holder of one or more mortgages encumbering the ▇▇▇▇▇▇
Property and (z) any other secured lender which has a mortgage or other
security interest in the ▇▇▇▇▇▇ Property or the Installment Contract, with
ninety (90) days after the Closing Date, and if such consents are so
obtained, Napco Inc. will deliver to Collateral Agent, within thirty (30)
days thereafter, the documents, instruments, opinions and other items set
forth in subsection (a)(ii)(1) through (10) of this Section; PROVIDED that
the Collateral Agent, in its sole judgment, may require a collateral
assignment of, or other security interest in, the Installment Contract in
lieu of the Mortgage set forth in subsection (a)(ii)(1), but in such case
the applicable Loan Party shall not be required to seek a second consent
thereto.
(b) If the applicable Loan Party which is the tenant under that
certain lease for the Real Property located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇, more particularly described in SCHEDULE 3.05(b), does not terminate such
lease and vacate such Real Property on or before June 30, 2004, such Loan Party
shall use commercially reasonable efforts to obtain within forty five (45) days
thereafter, the property owner's consent to leasehold mortgage financing on
terms and conditions reasonably satisfactory to Collateral Agent), and if such
consent is so obtained, the applicable Loan Party shall deliver to Collateral
Agent, within thirty (30) days thereafter, the documents, instruments, opinions
and other items set forth in subsection (a)(ii)(1) through (10) of this Section.
(c) If while any Obligations are outstanding, the mortgage(s) or
deed(s) of trust encumbering, as of the Closing Date, any of the Real Properties
identified on SCHEDULE 5.13(c) (which mortgage(s) or deed(s) of trust are more
particularly described in the applicable title commitments referred to in
SCHEDULE 6.02(c)) are satisfied or released, the applicable Loan Party shall
deliver to Collat-
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eral Agent with respect to any such Real Property, within thirty (30) days
thereafter, the documents, instruments, opinions and other items set forth in
subsection (a)(ii)(1) through (10) of this Section.
(d) The applicable Loan Party shall obtain and deliver to the
Collateral Agent, within ten (10) Business Days after the Closing Date, unless
waived or extended by the Collateral Agent in its discretion (x) a survey for
the Mortgaged Property located at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and (y) if not issued by Title Company on the Closing Date,
endorsements to the Title Policy respecting such Mortgaged Real Property,
removing the standard survey exception and providing the comprehensive and
survey endorsements thereto within fifteen (15) Business Days after the delivery
to the Collateral Agent of such Survey.
ARTICLE VI
NEGATIVE COVENANTS
Each Loan Party warrants, covenants and agrees with each Lender that,
so long as this Agreement shall remain in effect and until the Commitments have
been terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document have been paid in full
and all Letters of Credit have been canceled or have expired and all amounts
drawn thereunder have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing, no Loan Party will, nor will they cause or permit
any Subsidiaries to:
SECTION 6.01 INDEBTEDNESS. Incur, create, assume or permit to
exist, directly or indirectly, any Indebtedness, except
(a) Indebtedness incurred under this Agreement and the other Loan
Documents;
(b) (i) Indebtedness outstanding on the Closing Date and listed on
SCHEDULE 6.01(b), (ii) refinancings or renewals thereof or of the
Indebtedness under clauses (iii) and (iv) below; PROVIDED that (A) any
such refinancing Indebtedness is in an aggregate principal amount not
greater than the aggregate principal amount of the Indebtedness being
renewed or refinanced, PLUS the amount of any premiums required to be paid
thereon and reasonable fees and expenses associated therewith, (B) such
refinancing Indebtedness has a later or equal final maturity and longer or
equal weighted average life than the Indebtedness being renewed or
refinanced and (C) the covenants, events of default, subordination and
other provisions thereof (including any guarantees thereof) shall be, in
the aggregate in all material respects, no less favorable to the Lenders
than those contained in the Indebtedness being renewed or refinanced;
(iii) the Senior Subordinated Notes and Senior Subordinated Note
Guarantees issued on the Closing Date (including any notes and guarantees
issued in exchange therefor in accordance with the registration rights
document entered into in connection with the issuance of the Senior
Subordinated Notes and Senior Subordinated Note Guarantees); and (iv)
additional Senior Subordinated Notes and Senior Subordinated Note
Guarantees issued after the Closing Date (including any notes and
guarantees issued in exchange therefor in accordance with the registration
rights document entered into in connection with the issuance of the Senior
Subordinated Notes and Senior Subordinated Note Guarantees) in an
aggregate amount not to exceed $50.0 million less the aggregate amount of
any Additional Term Loans and additional Senior Subordinated Note
Guarantees issued after the Closing Date in accordance with the indenture
governing the Senior Subordinated Notes by any Subsidiary Guarantor formed
or acquired after the Closing Date;
(c) Indebtedness under Hedging Obligations that are designed to
protect against fluctuations in interest rates, foreign currency exchange
rates or commodity prices, in each case not
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entered into for speculative purposes; PROVIDED that if such Hedging
Obligations relate to interest rates, (a) such Hedging Obligations relate
to payment obligations on Indebtedness otherwise permitted to be incurred
by the Loan Documents and (b) the notional principal amount of such
Hedging Obligations at the time incurred does not exceed the principal
amount of the Indebtedness to which such Hedging Obligations relate;
(d) Indebtedness permitted by SECTION 6.04(f);
(e) Indebtedness in respect of Purchase Money Obligations and
Capital Lease Obligations, and refinancings or renewals thereof, in an
aggregate amount not to exceed $10.0 million at any time outstanding;
(f) Indebtedness incurred by Foreign Subsidiaries in an aggregate
amount not to exceed $15.0 million (not including the Canadian
Intercompany Note) at any time outstanding;
(g) Indebtedness in respect of bid, performance or surety bonds,
workers' compensation claims, self-insurance obligations and bankers
acceptances issued for the account of any Company in the ordinary course
of business, including guarantees or obligations of any Company with
respect to letters of credit supporting such bid, performance or surety
bonds, workers' compensation claims, self-insurance obligations and
bankers acceptances (in each case other than for an obligation for money
borrowed), in an aggregate amount not to exceed $10.0 million at any time
outstanding;
(h) Contingent Obligations of any Loan Party in respect of
Indebtedness otherwise permitted under this SECTION 6.01;
(i) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; PROVIDED, HOWEVER,
that such Indebtedness is extinguished within five Business Days of
incurrence;
(j) the Canadian Intercompany Note;
(k) Indebtedness arising in connection with endorsement of
instruments for deposit in the ordinary course of business;
(l) unsecured Indebtedness of any Company in an aggregate amount
not to exceed $20.0 million at any time outstanding;
(m) Indebtedness assumed in connection with any Permitted
Acquisition, and refinancing or renewals thereof, in an aggregate amount
not to exceed $20.0 million at any time outstanding;
(n) indemnification, adjustment of purchase price, earn-out or
similar obligations, in each case, incurred or assumed in connection with
the acquisition or disposition of any business or property of U.S.
Borrower or any Subsidiary of U.S. Borrower or Equity Interests of any
Subsidiary of U.S. Borrower, other than guarantees of Indebtedness
incurred by any person acquiring all or any portion of such business,
property or Equity Interests for the purpose of financing any such
acquisition; PROVIDED that the maximum aggregate liability in respect of
all such obligations outstanding under this clause (n) shall at no time
exceed (a) in the case of an acquisition, $10.0 million (PROVIDED that the
amount of such liability shall be deemed to be the amount thereof, if
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any, reflected on the balance sheet of U.S. Borrower or any Subsidiary
(E.G., the amount of such liability shall be deemed to be zero if no
amount is reflected on such balance sheet)) and (b) in the case of a
disposition, the gross proceeds actually received by U.S. Borrower and its
Subsidiaries in connection with such disposition; and
(o) Indebtedness incurred in the ordinary course of business under
guarantees of Indebtedness of suppliers, licensees, franchisees or
customers in an aggregate amount, together with the aggregate amount of
Investments made pursuant to SECTION 6.04(j), not to exceed $5.0 million
at any time outstanding.
SECTION 6.02 LIENS. Create, incur, assume or permit to exist,
directly or indirectly, any Lien on any property now owned or hereafter acquired
by it or on any income or revenues or rights in respect of any thereof, except
the following (collectively, the "PERMITTED LIENS"):
(a) inchoate Liens for taxes, assessments or governmental charges
or levies not yet due and payable or delinquent and Liens for taxes,
assessments or governmental charges or levies, which (i) are being
contested in good faith by appropriate proceedings for which adequate
reserves have been established in accordance with GAAP, which proceedings
(or orders entered in connection with such proceedings) have the effect of
preventing the forfeiture or sale of the property subject to any such
Lien, (ii) in the case of any such charge or claim which has or may become
a Lien against any of the Collateral, such Lien and the contest thereof
shall satisfy the Contested Collateral Lien Conditions and (iii)
individually or in the aggregate, could not reasonably expected to have a
Material Adverse Effect;
(b) Liens in respect of property of any Company imposed by law,
which were incurred in the ordinary course of business and do not secure
Indebtedness for borrowed money, such as carriers', warehousemen's,
materialmen's, landlords', workmen's, suppliers', repairmen's and
mechanics' Liens and other similar Liens arising in the ordinary course of
business, and (i) which do not in the aggregate materially detract from
the value of the property of the Companies, taken as a whole, and do not
materially impair the use thereof in the operation of the business of the
Companies, taken as a whole, (ii) which, if they secure obligations that
are then due and unpaid, are being contested in good faith by appropriate
proceedings for which adequate reserves have been established in
accordance with GAAP, which proceedings (or orders entered in connection
with such proceedings) have the effect of preventing the forfeiture or
sale of the property subject to any such Lien, and (iii) in the case of
any such Lien which has or may become a Lien against any of the
Collateral, such Lien and the contest thereof shall satisfy the Contested
Collateral Lien Conditions;
(c) any Lien in existence on the Closing Date and set forth on
SCHEDULE 6.02(c) and any Lien granted as a replacement or substitute
therefor; PROVIDED that any such replacement or substitute Lien (i) except
as permitted by SECTION 6.01(b)(ii)(A), does not secure an aggregate
amount of Indebtedness, if any, greater than that secured on the Closing
Date and (ii) does not encumber any property other than the property
subject thereto on the Closing Date (any such Lien, an "EXISTING LIEN");
(d) easements, rights-of-way, restrictions (including zoning
restrictions), covenants, licenses, encroachments, protrusions and other
similar charges or encumbrances, and minor title deficiencies on or with
respect to any Real Property, in each case whether now or hereafter in
existence, not (i) securing Indebtedness, (ii) individually or in the
aggregate materially impairing the value or marketability of such Real
Property or (iii) individually or in the aggregate materially interfering
with the ordinary conduct of the business of the Companies at such Real
Property;
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(e) Liens arising out of judgments, attachments or awards not
resulting in a Default and in respect of which such Company shall in good
faith be prosecuting an appeal or proceedings for review in respect of
which there shall be secured a subsisting stay of execution pending such
appeal or proceedings and, in the case of any such Lien which has or may
become a Lien against any of the Collateral, such Lien and the contest
thereof shall satisfy the Contested Collateral Lien Conditions;
(f) Liens (other than any Lien imposed by ERISA) (x) imposed by
law or deposits made in connection therewith in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security legislation, (y) incurred in the
ordinary course of business to secure the performance of tenders,
statutory obligations (other than excise taxes), surety, stay, customs and
appeal bonds, statutory bonds, bids, leases, government contracts, trade
contracts, performance and return of money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money)
or (z) arising by virtue of deposits made in the ordinary course of
business to secure liability for premiums to insurance carriers; PROVIDED
that (i) with respect to clauses (x), (y) and (z) of this paragraph (f),
such Liens are for amounts not yet due and payable or delinquent or, to
the extent such amounts are so due and payable, such amounts are being
contested in good faith by appropriate proceedings for which adequate
reserves have been established in accordance with GAAP, which proceedings
for orders entered in connection with such proceedings have the effect of
preventing the forfeiture or sale of the property subject to any such
Lien, (ii) to the extent such Liens are not imposed by law, such Liens
shall in no event encumber any property other than cash and Cash
Equivalents, (iii) in the case of any such Lien against any of the
Collateral, such Lien and the contest thereof shall satisfy the Contested
Collateral Lien Conditions and (iv) the aggregate amount of deposits at
any time pursuant to clause (y) and clause (z) of this paragraph (f) shall
not exceed $2.5 million in the aggregate;
(g) Leases of the properties of any Company, in each case entered
into in the ordinary course of such Company's business so long as such
Leases are subordinate in all respects to the Liens granted and evidenced
by the Security Documents and do not, individually or in the aggregate,
(i) interfere in any material respect with the ordinary conduct of the
business of any Company or (ii) materially impair the use (for its
intended purposes) or the value of the property subject thereto;
(h) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by
any Company in the ordinary course of business;
(i) Liens securing Indebtedness incurred pursuant to SECTION
6.01(e); PROVIDED that any such Liens attach only to the property being
financed pursuant to such Indebtedness and do not encumber any other
property of any Company;
(j) bankers' Liens, rights of setoff and other similar Liens
existing solely with respect to cash and Cash Equivalents on deposit in
one or more accounts maintained by any Company, in each case granted in
the ordinary course of business in favor of the bank or banks with which
such accounts are maintained, securing amounts owing to such bank with
respect to cash management and operating account arrangements, including
those involving pooled accounts and netting arrangements; PROVIDED that,
unless such Liens are non-consensual and arise by operation of law, in no
case shall any such Liens secure (either directly or indirectly) the
repayment of any Indebtedness;
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(k) Liens on property of a person existing at the time such person
is acquired or merged with or into or consolidated with any Company to the
extent permitted hereunder (and not created in anticipation or
contemplation thereof); PROVIDED that such Liens do not extend to property
not subject to such Liens at the time of acquisition (other than
improvements thereon) and are no more favorable to the lienholders than
such existing Lien;
(l) Liens granted pursuant to the Security Documents to secure the
Obligations;
(m) licenses of Intellectual Property granted by any Company in
the ordinary course of business and not interfering in any material
respect with the ordinary conduct of business of the Companies;
(n) the filing of UCC or PPSA financing statements solely as a
precautionary measure in connection with operating leases or consignment
of goods;
(o) Liens securing Indebtedness incurred pursuant to SECTION
6.01(f); PROVIDED that (i) such Liens do not extend to, or encumber,
property which constitutes Collateral and (ii) such Liens extend only to
the property (or Equity Interests) of the Foreign Subsidiary incurring
such Indebtedness;
(p) the existence of the "equal and ratable" clause in the Senior
Subordinated Note Documents (but not any security interests granted
pursuant thereto); and
(q) Liens incurred in the ordinary course of business of any
Company with respect to obligations that do not in the aggregate exceed
$5.0 million at any time outstanding, so long as such Liens, to the extent
covering any Collateral, are junior to the Liens granted pursuant to the
Security Documents;
PROVIDED, HOWEVER, that no consensual Liens shall be permitted to exist,
directly or indirectly, on any Securities Collateral, other than Liens granted
pursuant to the Security Documents.
SECTION 6.03 SALE AND LEASEBACK TRANSACTIONS. Enter into any
arrangement, directly or indirectly, with any person whereby it shall sell or
transfer any property, real or personal, used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease such property or
other property which it intends to use for substantially the same purpose or
purposes as the property being sold or transferred (a "SALE AND LEASEBACK
TRANSACTION") (other than a Permitted Sale and Leaseback Transaction) unless (i)
the sale of such property is permitted by SECTION 6.06 and (ii) any Liens
arising in connection with its use of such property are permitted by SECTION
6.02.
SECTION 6.04 INVESTMENT, LOAN AND ADVANCES. Directly or
indirectly, lend money or credit (by way of guarantee or otherwise) or make
advances to any person, or purchase or acquire any stock, bonds, notes,
debentures or other obligations or securities of, or any other interest in, or
make any capital contribution to, any other person, or purchase or own a futures
contract or otherwise become liable for the purchase or sale of currency or
other commodities at a future date in the nature of a futures contract (all of
the foregoing, collectively, "INVESTMENTS"), except that the following shall be
permitted:
(a) the Companies may consummate the Transactions in accordance
with the provisions of the Transaction Documents;
(b) Investments outstanding on the Closing Date and identified on
SCHEDULE 6.04(b);
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(c) the Companies may (i) acquire and hold accounts receivables
owing to any of them if created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary terms,
(ii) invest in, acquire and hold cash and Cash Equivalents, (iii) endorse
negotiable instruments held for collection in the ordinary course of
business or (iv) make lease, utility and other similar deposits in the
ordinary course of business;
(d) Hedging Obligations incurred pursuant to SECTION 6.01(c);
(e) loans and advances to directors, employees and officers of
U.S. Borrower and the Subsidiaries for BONA FIDE business purposes and to
purchase Equity Interests of Holdings, in aggregate amount not to exceed
$5.0 million at any time outstanding;
(f) Investments (i) by Parent, U.S. Borrower or any U.S.
Subsidiary Guarantor in U.S. Borrower or any U.S. Subsidiary Guarantor,
(ii) by Canadian Borrower or any Canadian Subsidiary Guarantor in Canadian
Borrower or any Canadian Subsidiary Guarantor and (iii) by a Subsidiary
that is not a Subsidiary Guarantor in any other Subsidiary that is not a
Subsidiary Guarantor; PROVIDED that any Investment in the form of a loan
or advance by or in a Loan Party shall be evidenced by an Intercompany
Note and, in the case of a loan or advance by a Loan Party, pledged by
such Loan Party as Collateral pursuant to the Security Documents;
(g) Investments in securities of trade creditors or customers in
the ordinary course of business received upon foreclosure or pursuant to
any plan of reorganization or similar arrangement upon the bankruptcy or
insolvency of such trade creditors or customers;
(h) Investments made by U.S. Borrower or any Subsidiary as a
result of consideration received in connection with an Asset Sale made in
compliance with SECTION 6.06;
(i) (x) Investments in Foreign Subsidiaries in an aggregate amount
not to exceed $10.0 million at any time outstanding, after taking into
account amounts returned in cash (including upon disposition) and (y)
Investments in Foreign Subsidiaries with the proceeds of Excluded
Issuances to the extent such proceeds have not been utilized for any other
purpose; PROVIDED that any such Investment made in the form of a loan or
advance shall be evidenced by an Intercompany Note and, in the case of a
loan or advance by a Loan Party, pledged by such Loan Party as Collateral
pursuant to the Security Documents;
(j) loans and advances to suppliers, licensees, franchisees or
customers of U.S. Borrower or any of its Subsidiaries made in the ordinary
course of business in an aggregate amount, together with the aggregate
amount of Indebtedness incurred pursuant to SECTION 6.01(o), not to exceed
$5.0 million at any time outstanding;
(k) Investments in Subsidiaries as a result of the consummation of
Permitted Acquisitions;
(l) Guarantees of Indebtedness not prohibited by SECTION 6.01; and
(m) other investments in an aggregate amount not to exceed $20.0
million at any time outstanding.
SECTION 6.05 MERGERS AND CONSOLIDATIONS. Wind up, liquidate or
dissolve its affairs or enter into any transaction of merger or consolidation
(or agree to do any of the foregoing at any future time), except that the
following shall be permitted:
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(a) Asset Sales in compliance with SECTION 6.06;
(b) acquisitions in compliance with SECTION 6.07;
(c) (x) any Company (other than Canadian Borrower or any Canadian
Subsidiaries) may merge or consolidate with or into U.S. Borrower or any
U.S. Subsidiary Guarantor (as long as U.S. Borrower or a U.S. Subsidiary
Guarantor is the surviving person in such merger or consolidation and
remains a Wholly Owned Subsidiary of Parent); PROVIDED that the Lien on
and security interest in such property granted or to be granted in favor
of the Collateral Agent under the Security Documents shall be maintained
or created in accordance with the provisions of SECTION 5.10 or SECTION
5.11, as applicable and (y) any Non-Guarantor Subsidiary may transfer
property or lease to or acquire or lease property from any Non-Guarantor
Subsidiary or may be merged into any other Non-Guarantor Subsidiary; and
(d) Canadian Borrower or any Canadian Subsidiaries may merge or
consolidate with or into Canadian Borrower or any Canadian Subsidiary
Guarantor (as long as Canadian Borrower or a Canadian Subsidiary Guarantor
is the surviving person in such merger or consolidation and remains a
Wholly Owned Subsidiary of Parent); PROVIDED that the Lien on and security
interest in such property granted or to be granted in favor of the
Collateral Agent under the Security Documents shall be maintained or
created in accordance with the provisions of SECTION 5.10 or SECTION 5.11,
as applicable; and
(e) any Subsidiary (other than Canadian Borrower) may dissolve,
liquidate or wind up its affairs at any time; PROVIDED that such
dissolution, liquidation or winding up, as applicable, could not
reasonably be expected to have a Material Adverse Effect; and
(f) Holdings may merge with or into or consolidate with or into
Parent in connection with any IPO, as long as the surviving person assumes
all of the obligations of Parent under the Loan Documents and no Default
shall have occurred and be continuing.
To the extent the Required Lenders waive the provisions of this SECTION
6.05 with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this SECTION 6.05, such Collateral (unless sold to a Company) shall
be sold free and clear of the Liens created by the Security Documents, and the
Agents shall take all actions they deem appropriate in order to effect the
foregoing.
SECTION 6.06 ASSET SALES. Effect any Asset Sale, or agree to
effect any Asset Sale, except that the following shall be permitted subject to
SECTION 2.10(c):
(a) disposition of used, worn out, obsolete or surplus property by
any Loan Party in the ordinary course of business and the abandonment or
other disposition of Intellectual Property that is, in the reasonable
judgment of U.S. Borrower, no longer economically practicable to maintain
or useful in the conduct of the business of the Companies taken as a
whole;
(b) Asset Sales (other than Asset Sales of Equity Interests in
Canadian Borrower); PROVIDED that the aggregate consideration received in
respect of all Asset Sales pursuant to this clause (b) shall not exceed
$25.0 million in any four consecutive fiscal quarters of U.S. Borrower;
(c) leases of real or personal property in the ordinary course of
business and in accordance with the applicable Security Documents;
(d) the Transactions as contemplated by the Transaction Documents;
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(e) mergers and consolidations in compliance with SECTION 6.05;
(f) Investments in compliance with SECTION 6.04;
(g) Permitted Sale and Leaseback Transactions;
(h) the sale of (i) all, but not less than all, of the Equity
Interests in Canadian Borrower, or (ii) all or substantially all of the
assets of Canadian Borrower; PROVIDED that, in the case of (ii), all
Canadian Term Loans and Obligations related thereto are repaid prior to or
simultaneously with such Asset Sale;
(i) U.S. Borrower and the Subsidiaries may sell Cash Equivalents
in the ordinary course of business;
(j) sales, transfers and dispositions of accounts receivable in
connection with the compromise, settlement or collection thereof; and
(k) within 365 days after the consummation of a Permitted
Acquisition, the sale, transfer or disposition for cash, and for fair
market value, of assets acquired in connection with such Permitted
Acquisition and not required in the operation of the business of U.S.
Borrower or any of the Subsidiaries.
To the extent the Required Lenders waive the provisions of this SECTION
6.06 with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this SECTION 6.06, such Collateral (unless sold to a Company) shall
be sold free and clear of the Liens created by the Security Documents, and the
Agents shall take all actions they deem appropriate in order to effect the
foregoing.
SECTION 6.07 ACQUISITIONS. Purchase or otherwise acquire (in one
or a series of related transactions) any part of the property (whether tangible
or intangible) of any person (or agree to do any of the foregoing at any future
time), except that the following shall be permitted:
(a) Capital Expenditures by U.S. Borrower and the Subsidiaries
shall be permitted to the extent permitted by SECTION 6.10(c);
(b) purchases and other acquisitions of inventory, materials,
equipment and intangible property in the ordinary course of business;
(c) Investments in compliance with SECTION 6.04;
(d) leases of real or personal property in the ordinary course of
business and in accordance with the applicable Security Documents;
(e) the Transactions as contemplated by the Transaction Documents;
(f) Permitted Acquisitions; and
(g) mergers and consolidations in compliance with SECTION 6.05;
PROVIDED that the Lien on and security interest in such property granted or to
be granted in favor of the Collateral Agent under the Security Documents shall
be maintained or created in accordance with the provisions of SECTION 5.10 or
SECTION 5.11, as applicable.
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SECTION 6.08 DIVIDENDS. Authorize, declare or pay, directly or
indirectly, any Dividends with respect to any Company, except that the following
shall be permitted:
(a) Dividends by any Company to U.S. Borrower, Canadian Borrower
or any Subsidiary of U.S. Borrower and to minority equityholders of any
Subsidiary paid ratably;
(b) payments by U.S. Borrower or by Holdings to permit Holdings or
Parent, and which are used by Holdings or Parent, to redeem Equity
Interests of U.S. Borrower, Holdings or Parent held by officers, directors
or employees or former officers, directors or employees (or their
transferees, estates or beneficiaries under their estates), upon their
death, disability, retirement, severance or termination of employment or
service; PROVIDED that the aggregate cash consideration paid for all such
redemptions shall not exceed the sum of (A) $5.0 million during any
calendar year (with unused amounts being available to be used in the
following calendar year, but not in any succeeding calendar year) plus (B)
the amount of any Net Cash Proceeds received by or contributed to U.S.
Borrower from the issuance and sale after the Closing Date of Qualified
Capital Stock of Parent, Holdings or U.S. Borrower to its officers,
directors or employees that have not been applied to the payment of
Dividends pursuant to this clause (b), plus (C) the Net Cash Proceeds of
any "key-man" life insurance policies that have not been applied to the
payment of Dividends pursuant to this clause (b);
(c) (A) to the extent actually used by Parent and Holdings to pay
such taxes, costs and expenses, payments by U.S. Borrower to or on behalf
of Parent and Holdings in an amount sufficient to pay franchise taxes and
other fees required to maintain the legal existence of Parent and Holdings
and (B) payments by U.S. Borrower to or on behalf of Parent and Holdings
in an amount sufficient to pay out-of-pocket legal, accounting and filing
costs and other expenses in the nature of overhead of Parent and Holdings,
in the case of clauses (A) and (B) in an aggregate amount not to exceed
$500,000 in any fiscal year;
(d) Permitted Tax Distributions by U.S. Borrower to Parent or
Holdings, so long as Parent or Holdings uses such distributions to pay its
taxes;
(e) to the extent that the Net Cash Proceeds of any Permitted Sale
and Leaseback Transaction exceed the Permitted Sale and Leaseback
Transaction Amount, payments of such excess amount to Holdings to permit
Holdings to pay a Dividend to the holders of Equity Interests of Holdings
or a distribution to the holders of Indebtedness of Holdings; and
(f) distributions to Parent in order to enable Parent or Holdings
to pay, and which are used by Parent or Holdings to pay, customary and
reasonable costs and expenses of an offering of securities of Parent or
Holdings that is not consummated.
SECTION 6.09 TRANSACTIONS WITH AFFILIATES. Enter into, directly or
indirectly, any transaction or series of related transactions, whether or not in
the ordinary course of business, with any Affiliate of any Company (other than
between or among U.S. Borrower and one or more U.S. Subsidiary Guarantors or
between or among Canadian Borrower and one or more Canadian Subsidiary
Guarantors), other than on terms and conditions at least as favorable to such
Company as would reasonably be obtained by such Company at that time in a
comparable arm's-length transaction with a person other than an Affiliate,
except that the following shall be permitted:
(a) Dividends permitted by SECTION 6.08;
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(b) Investments permitted by SECTIONS 6.04(E), (F), (I) and, to
the extent such Investments are in Subsidiaries, (M);
(c) reasonable and customary director, officer and employee
compensation (including bonuses) and other benefits (including retirement,
health, stock option and other benefit plans) and indemnification,
compensation, employment and severance agreements, in each case approved
by the Board of Directors;
(d) transactions with customers, clients, suppliers, joint venture
partners or purchasers or sellers of goods and services, in each case in
the ordinary course of business and otherwise not prohibited by the Loan
Documents;
(e) so long as no Default exists, the payment of regular
management fees and transaction fees payable upon acquisitions,
divestitures and the sale of Parent, to Sponsor in the amounts and at the
times specified in the Advisory Services Agreement, as in effect on the
Closing Date or as thereafter amended or replaced in any manner, that,
taken as a whole, is not more adverse to the interests of the Lenders in
any material respect than such agreement as it was in effect on the
Closing Date;
(f) sales or issuances of Qualified Capital Stock to Affiliates of
U.S. Borrower not otherwise prohibited by the Loan Documents and the
granting of registration and other customary rights in connection
therewith;
(g) any transaction with an Affiliate where the only consideration
paid by any Loan Party is Qualified Capital Stock;
(h) the Transactions as contemplated by the Transaction Documents;
(i) the entering into of a tax sharing agreement, or payments
pursuant thereto, between U.S. Borrower and/or one or more Subsidiaries,
on the one hand, and any other person with which U.S. Borrower or such
Subsidiaries are required or permitted to file a consolidated tax return
or with which U.S. Borrower or such Subsidiaries are part of a
consolidated group for tax purposes, on the other hand, which payments by
U.S. Borrower and its Subsidiaries are not in excess of the tax
liabilities that would have been payable by them on a stand-alone basis;
(j) entering into an agreement that provides registration rights
to the shareholders of U.S. Borrower, Holdings or Parent or amending any
such agreement with shareholders of U.S. Borrower, Holdings or Parent and
the performance of such agreements;
(k) any transaction with a joint venture or similar entity which
would constitute a transaction with an Affiliate solely because U.S.
Borrower or any of its Subsidiaries owns an equity interest in or
otherwise controls such joint venture or similar entity; PROVIDED that no
Affiliate of U.S. Borrower or any of its Subsidiaries other than U.S.
Borrower or any Subsidiary of U.S. Borrower shall have a beneficial
interest in such joint venture or similar entity;
(l) any merger, consolidation or reorganization of U.S. Borrower
with an Affiliate, solely for the purposes of (a) reorganizing to
facilitate an IPO of securities of U.S. Borrower, Holdings, Parent or
other holding company, (b) forming a holding company or (c)
reincorporating U.S. Borrower in a new jurisdiction;
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(m) sales of inventory between or among U.S. Borrower and/or one
or more of its Subsidiaries in the ordinary course of business; and
(n) (i) any agreement in effect on the Closing Date listed on
SCHEDULE 6.09(n), as in effect on the Closing Date or as thereafter
amended or replaced in any manner, that, taken as a whole, is not more
adverse to the interests of the Lenders in any material respect than such
agreement as it was in effect on the Closing Date or (ii) any transaction
pursuant to any agreement referred to in the immediately preceding clause
(i).
SECTION 6.10 FINANCIAL COVENANTS.(a)
(a) MAXIMUM TOTAL LEVERAGE RATIO. Permit the Total Leverage Ratio,
at any date during any period set forth in the table below, to exceed the ratio
set forth opposite such period in the table below:
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TEST PERIOD LEVERAGE RATIO
----------- --------------
-----------------------------------------------------------------------
Closing Date - March 31, 2005 6.25 to 1.0
-----------------------------------------------------------------------
April 1, 2005 - June 30, 2005 5.95 to 1.0
-----------------------------------------------------------------------
July 1, 2005 - March 31, 2006 5.75 to 1.0
-----------------------------------------------------------------------
April 1, 2006 - September 30, 2006 5.50 to 1.0
-----------------------------------------------------------------------
October 1, 2006 - March 31, 2007 5.25 to 1.0
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April 1, 2007 - June 30, 2007 5.00 to 1.0
-----------------------------------------------------------------------
July 1, 2007 - December 31, 2007 4.75 to 1.0
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January 1, 2008 - June 30, 2008 4.50 to 1.0
-----------------------------------------------------------------------
July 1, 2008 - September 30, 2008 4.25 to 1.0
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October 1, 2008 and thereafter 4.00 to 1.0
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(b) MINIMUM INTEREST COVERAGE RATIO. Permit the Consolidated
Interest Coverage Ratio, for any Test Period ending during any period set forth
in the table below, to be less than the ratio set forth opposite such period in
the table below:
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INTEREST
TEST PERIOD COVERAGE RATIO
----------- --------------
-----------------------------------------------------------------------
Closing Date - December 31, 2004 1.90 to 1.0
-----------------------------------------------------------------------
January 1, 2005 - March 31, 2006 2.00 to 1.0
-----------------------------------------------------------------------
April 1, 2006 - December 31, 2006 2.10 to 1.0
-----------------------------------------------------------------------
January 1, 2007 - June 30, 2007 2.25 to 1.0
-----------------------------------------------------------------------
July 1, 2007 - December 31, 2007 2.35 to 1.0
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January 1, 2008 - September 30, 2008 2.50 to 1.0
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October 1, 2008 and thereafter 2.75 to 1.0
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(c) LIMITATION ON CAPITAL EXPENDITURES. Permit the aggregate
amount of Capital Expenditures made in any period set forth below, to exceed the
amount set forth opposite such period below:
-----------------------------------------------------------------------
PERIOD AMOUNT (IN MILLIONS)
------ --------------------
-----------------------------------------------------------------------
Closing Date - December 31, 2004 $15.0
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January 1, 2005 - December 31, 2005 $15.0
-----------------------------------------------------------------------
January 1, 2006 - December 31, 2006 $15.0
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January 1, 2007 - December 31, 2007 $16.0
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January 1, 2008 - December 31, 2008 $16.0
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Each calendar year ending after 2008 $16.0
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; PROVIDED, HOWEVER, that (x) if the aggregate amount of Capital Expenditures
made in any fiscal year shall be less than the maximum amount of Capital
Expenditures permitted under this SECTION 6.10(c) for such fiscal year (before
giving effect to any carryover), then an amount of such shortfall not exceeding
50% of such maximum amount (without giving effect to clause (z) below) (the
"CAPEX CARRYFORWARD AMOUNT") may be added to the amount of Capital Expenditures
permitted under this SECTION 6.10(c) for the immediately succeeding (but not any
other) fiscal year, (y) in determining whether any amount is available for
carryover, the amount expended in any fiscal year shall first be deemed to be
from the amount allocated to such fiscal year (before giving effect to any
carryover) and (z) the amount set forth in the table above for any period may be
increased by the amount of Net Cash Proceeds of Excluded Issuances designated
for Capital Expenditures for such period during such period.
SECTION 6.11 PREPAYMENTS OF OTHER INDEBTEDNESS; MODIFICATIONS OF
ORGANIZATIONAL DOCUMENTS AND OTHER DOCUMENTS, ETC. Directly or indirectly:
(a) make (or give any notice in respect thereof) any voluntary or
optional payment or prepayment on or redemption or acquisition for value
of, or any prepayment or redemption as a result of any asset sale, change
of control or similar event of, any Indebtedness outstanding under the
Senior Subordinated Notes or any other Subordinated Indebtedness, except
as otherwise permitted by this Agreement;
(b) amend or modify, or permit the amendment or modification of,
any provision of any Transaction Document in any manner that is adverse in
any material respect to the interests of the Lenders;
(c) terminate, amend, modify (including electing to treat any
Pledged Interests (as defined in the U.S. Security Agreement) as a
"security" under Section 8-103 of the UCC) or change any of its
Organizational Documents (including by the filing or modification of any
certificate of designation) or any agreement to which it is a party with
respect to its Equity Interests (including any stockholders' agreement),
or enter into any new agreement with respect to its Equity Interests,
other than any such amendments, modifications or changes or such new
agreements which are not adverse in any material respect to the interests
of the Lenders; PROVIDED that Parent may issue such Equity Interests, so
long as such issuance is not prohibited by SECTION 6.13 or any other
provision of this Agreement, and may amend its Organizational Documents to
authorize any such Equity Interests; or
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(d) cause or permit any other obligation (other than the
Obligations and the Guaranteed Obligations) to constitute Designated
Senior Debt (as defined in the Senior Subordinated Note Documents).
SECTION 6.12 LIMITATION ON CERTAIN RESTRICTIONS ON SUBSIDIARIES.
Directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any Subsidiary to (a)
pay dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by U.S. Borrower or any
Subsidiary, or pay any Indebtedness owed to U.S. Borrower or a Subsidiary, (b)
make loans or advances to U.S. Borrower or any Subsidiary or (c) transfer any of
its properties to U.S. Borrower or any Subsidiary, except for such encumbrances
or restrictions existing under or by reason of (i) applicable law; (ii) this
Agreement and the other Loan Documents; (iii) the Senior Subordinated Note
Documents as in effect on the Closing Date; (iv) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of a Subsidiary; (v) customary provisions restricting assignment of any
agreement entered into by a Subsidiary in the ordinary course of business; (vi)
any Lien permitted by SECTION 6.02 restricting the transfer of the property
subject thereto; (vii) customary restrictions and conditions contained in any
agreement relating to the sale of any property permitted under SECTION 6.06
pending the consummation of such sale; (viii) any agreement applicable to such
Subsidiary in effect at the time such Subsidiary becomes a Subsidiary of U.S.
Borrower, so long as such agreement was not entered into in connection with or
in contemplation of such person becoming a Subsidiary of U.S. Borrower; (ix)
customary provisions in partnership agreements, limited liability company
organizational governance documents, asset sales and stock sale agreements and
other similar agreements entered into in the ordinary course of business that
restrict the transfer of ownership interests in such partnership, limited
liability company or similar person; (x) restrictions on cash or other deposits
or net worth imposed by suppliers or landlords under contracts entered into in
the ordinary course of business; (xi) any instrument governing Indebtedness
assumed in connection with any Permitted Acquisition, which encumbrance or
restriction is not applicable to any person, or the properties or assets of any
person, other than the person or the properties or assets of the person so
acquired; (xii) in the case of any joint venture which is not a Loan Party in
respect of any matters referred to in clauses (b) and (c) above, restrictions in
such person's Organizational Documents or pursuant to any joint venture
agreement or stockholders agreements solely to the extent of the Equity
Interests of or property held in the subject joint venture or other entity;
(xiii) any encumbrances or restrictions imposed by any amendments or
refinancings that are otherwise permitted by the Loan Documents of the
contracts, instruments or obligations referred to in clauses (iii), (viii) or
(xi) above; PROVIDED that such amendments or refinancings are no more materially
restrictive with respect to such encumbrances and restrictions than those prior
to such amendment or refinancing; or (xiv) encumbrances or restrictions
contained in Indebtedness of Foreign Subsidiaries, or municipal loan or related
agreements entered into in connection with the incurrence of industrial or
economic revenue bonds, permitted to be incurred under this Agreement; PROVIDED
that any such encumbrances or restrictions are ordinary and customary with
respect to the type of Indebtedness being incurred under the relevant
circumstances and do not, in the good faith judgment of the Board of Directors
of U.S. Borrower, materially impair either Borrower's ability to make payment on
the Obligations when due.
SECTION 6.13 LIMITATION ON ISSUANCE OF CAPITAL STOCK. (a) With
respect to Parent, issue any Equity Interest that is not Qualified Capital
Stock.
(b) With respect to U.S. Borrower or any Subsidiary, issue any
Equity Interest (including by way of sales of treasury stock) or any options or
warrants to purchase, or securities convertible into, any Equity Interest,
except (i) for stock splits, stock dividends and additional issuances of Equity
Interests which do not decrease the percentage ownership of U.S. Borrower or any
Subsidiaries in any class of the Equity Interest of such Subsidiary; (ii)
Subsidiaries of U.S. Borrower formed after the Closing Date in accordance with
SECTION 6.14 may issue Equity Interests to U.S. Borrower or the Subsidiary of
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Borrower which is to own such Equity Interests; and (iii) U.S. Borrower may
issue common stock that is Qualified Capital Stock to Parent. All Equity
Interests issued in accordance with this SECTION 6.13(b) shall, to the extent
required by SECTIONS 5.10 and 5.11 or any Security Document, be delivered to the
Collateral Agent for pledge pursuant to the applicable Security Document.
SECTION 6.14 LIMITATION ON CREATION OF SUBSIDIARIES. Establish,
create or acquire any additional Subsidiaries without the prior written consent
of the Required Lenders; PROVIDED that, without such consent, U.S. Borrower may
(i) establish or create one or more Wholly Owned Subsidiaries of U.S. Borrower,
(ii) establish, create or acquire one or more Subsidiaries in connection with an
Investment made pursuant to SECTIONS 6.04(f), (k) or (m) or (iii) acquire one or
more Subsidiaries in connection with a Permitted Acquisition, so long as, in
each case, SECTION 5.10(b) shall be complied with.
SECTION 6.15 BUSINESS. (a) With respect to Parent, engage in any
business activities or have any properties or liabilities, other than (i) its
ownership of the Equity Interests of U.S. Borrower, (ii) obligations under the
Loan Documents and the Senior Subordinated Note Documents and (iii) activities
and properties incidental, ancillary or complementary to the foregoing clauses
(i) and (ii).
(b) With respect to U.S. Borrower and the Subsidiaries, engage
(directly or indirectly) in any business other than those businesses in which
U.S. Borrower and its Subsidiaries are engaged on the Closing Date as described
in the Confidential Information Memorandum (or, in the good faith judgment of
the Board of Directors, which are substantially related thereto or are
reasonable extensions thereof).
SECTION 6.16 LIMITATION ON ACCOUNTING CHANGES. Make or permit, any
significant change in accounting policies or reporting practices, without the
consent of the Administrative Agent, which consent shall not be unreasonably
withheld, except changes that are required by GAAP.
SECTION 6.17 FISCAL YEAR. Change its fiscal year-end to a date
other than December 31.
SECTION 6.18 LEASE OBLIGATIONS. Create, incur, assume or suffer to
exist any obligations as lessee for the rental or hire of real or personal
property of any kind under leases or agreements to lease having an original term
of one year or more other than (1) such obligations existing on the Closing
Date, (2) such obligations acquired in connection with a Permitted Acquisition
that are not incurred in anticipation of such Permitted Acquisition and are
obligations only of any legal entities acquired in such Permitted Acquisition
and (3) with respect to other obligations, created, incurred, assumed or
suffered to exist after the Closing Date, such obligations that would cause the
direct and contingent liabilities of U.S. Borrower and its Subsidiaries, on a
consolidated basis, in respect of all such obligations created, incurred,
assumed or suffered to exist after the Closing Date not to exceed the sum of (i)
$5.0 million and (ii) amounts payable in respect of leases entered into in
connection with Permitted Sale and Leaseback Transactions, payable in any period
of 12 consecutive months.
SECTION 6.19 NO FURTHER NEGATIVE PLEDGE. Enter into any agreement,
instrument, deed or lease which prohibits or limits the ability of any Loan
Party to create, incur, assume or suffer to exist any Lien upon any of their
respective properties or revenues, whether now owned or hereafter acquired, or
which requires the grant of any security for an obligation if security is
granted for another obligation, except the following: (1) this Agreement and the
other Loan Documents; (2) covenants in documents creating Liens permitted by
SECTION 6.02 prohibiting further Liens on the properties encumbered thereby; (3)
the Senior Subordinated Note Documents as in effect on the Closing Date; (4) any
other agreement that does not restrict in any manner (directly or indirectly)
Liens created pursuant to the Loan Documents on any Collateral securing the
Obligations and does not require the direct or indirect
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granting of any Lien securing any Indebtedness or other obligation by virtue of
the granting of Liens on or pledge of property of any Loan Party to secure the
Obligations; and (5) any prohibition or limitation that (a) exists pursuant to
applicable law, (b) consists of customary restrictions and conditions contained
in any agreement relating to the sale of any property permitted under SECTION
6.06 pending the consummation of such sale, (c) restricts subletting or
assignment of any lease governing a leasehold interest of U.S. Borrower or a
Subsidiary, (d) exists in any agreement in effect at the time such Subsidiary
becomes a Subsidiary of U.S. Borrower, so long as such agreement was not entered
into in contemplation of such person becoming a Subsidiary or (e) is imposed by
any amendments or refinancings that are otherwise permitted by the Loan
Documents of the contracts, instruments or obligations referred to in clause (3)
or (5)(e); PROVIDED that such amendments and refinancings are no more materially
restrictive with respect to such prohibitions and limitations than those prior
to such amendment or refinancing.
SECTION 6.20 ANTI-TERRORISM LAW; ANTI-MONEY LAUNDERING. (a)
Directly or indirectly, (i) knowingly conduct any business or engage in making
or receiving any contribution of funds, goods or services to or for the benefit
of any person described in SECTION 3.22, (ii) knowingly deal in, or otherwise
engage in any transaction relating to, any property or interests in property
blocked pursuant to the Executive Order or any other Anti-Terrorism Law, or
(iii) knowingly engage in or conspire to engage in any transaction that evades
or avoids, or has the purpose of evading or avoiding, or attempts to violate,
any of the prohibitions set forth in any Anti-Terrorism Law (and the Loan
Parties shall deliver to the Lenders any certification or other evidence
requested from time to time by any Lender in its reasonable discretion,
confirming the Loan Parties' compliance with this SECTION 6.20).
(b) Cause or permit any of the funds of such Loan Party that are
used to repay the Loans to be derived from any unlawful activity with the result
that the making of the Loans would be in violation of law.
SECTION 6.21 EMBARGOED PERSON. Cause or permit (a) any of the
funds or properties of the Loan Parties that are used to repay the Loans to
constitute property of, or be beneficially owned directly or indirectly by, any
person subject to sanctions or trade restrictions under United States law
("EMBARGOED PERSON" or "EMBARGOED PERSONS") that is identified on (1) the "List
of Specially Designated Nationals and Blocked Persons" (the "SDN LIST")
maintained by OFAC and/or on any other similar list ("OTHER LIST") maintained by
OFAC pursuant to any authorizing statute including, but not limited to, the
International Emergency Economic Powers Act, 50 U.S.C. Sections 1701 et seq.,
The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive
Order or regulation promulgated thereunder, with the result that the investment
in the Loan Parties (whether directly or indirectly) is prohibited by law, or
the Loans made by the Lenders would be in violation of law, or (2) the Executive
Order, any related enabling legislation or any other similar Executive Orders
(collectively, "EXECUTIVE ORDERS"), or (b) any Embargoed Person to have any
direct or indirect interest, of any nature whatsoever in the Loan Parties, with
the result that the investment in the Loan Parties (whether directly or
indirectly) is prohibited by law or the Loans are in violation of law.
ARTICLE VII
GUARANTEE
SECTION 7.01 THE GUARANTEE. Parent and each U.S. Subsidiary
Guarantor (the "U.S. GUARANTORS") hereby, jointly and severally guarantee, as a
primary obligor and not as a surety to each U.S. Secured Party and their
respective successors and assigns, the prompt payment in full when due (whether
at stated maturity, by required prepayment, declaration, demand, by acceleration
or otherwise) of the principal of and interest (including any interest, fees,
costs or charges that would accrue but for the provisions of the Title 11 of the
United States Code after any bankruptcy or insolvency petition under Ti-
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tle 11 of the United States Code) on the Loans made by the Lenders to, and the
Notes held by each Lender of, U.S. Borrower, and all other U.S. Obligations from
time to time owing to the Secured Parties by any U.S. Loan Party under any Loan
Document in each case strictly in accordance with the terms thereof (such
obligations being herein collectively called the "U.S. GUARANTEED OBLIGATIONS").
Parent, the U.S. Borrower and each Canadian Subsidiary Guarantor (the "CANADIAN
GUARANTORS") hereby, jointly and severally guarantee, as a primary obligor and
not as a surety to each Canadian Secured Party and their respective successors
and assigns, the prompt payment in full when due (whether at stated maturity, by
required prepayment, declaration, demand, by acceleration or otherwise) of the
principal of and interest (including any interest, fees, costs or charges that
would accrue but for the provisions of the Title 11 of the United States Code or
other applicable bankruptcy or insolvency legislation after any bankruptcy or
insolvency petition under Title 11 of the United States Code or other applicable
bankruptcy or insolvency legislation) on the Loans made by the Lenders to, and
the Notes held by each Lender of, Canadian Borrower, and all other Canadian
Obligations from time to time owing to the Canadian Secured Parties by any
Canadian Loan Party under any Loan Document in each case strictly in accordance
with the terms thereof (such obligations being herein collectively called the
"CANADIAN GUARANTEED OBLIGATIONS"). The U.S. Guarantors hereby jointly and
severally agree that if U.S. Borrower or other U.S. Guarantor(s) shall fail to
pay in full when due (whether at stated maturity, by acceleration or otherwise)
any of the U.S. Guaranteed Obligations, the U.S. Guarantors will promptly pay
the same in cash, without any demand or notice whatsoever, and that in the case
of any extension of time of payment or renewal of any of the U.S. Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms of
such extension or renewal. The Canadian Guarantors hereby jointly and severally
agree that if Canadian Borrower or other Canadian Guarantor(s) shall fail to pay
in full when due (whether at stated maturity, by acceleration or otherwise) any
of the Canadian Guaranteed Obligations, the Canadian Guarantors will promptly
pay the same in cash, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Canadian
Guaranteed Obligations, the same will be promptly paid in full when due (whether
at extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal.
SECTION 7.02 OBLIGATIONS UNCONDITIONAL. The obligations of the
Guarantors under SECTION 7.01 shall constitute a guaranty of payment and to the
fullest extent permitted by applicable law, are absolute, irrevocable and
unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the Guaranteed Obligations of the
Borrowers under this Agreement, the Notes, if any, or any other agreement or
instrument referred to herein or therein, or any substitution, release or
exchange of any other guarantee of or security for any of the Guaranteed
Obligations, and, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
Guarantor (except for payment in full). Without limiting the generality of the
foregoing, it is agreed that the occurrence of any one or more of the following
shall not alter or impair the liability of the Guarantors hereunder which shall
remain absolute, irrevocable and unconditional under any and all circumstances
as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes, if any, or any other agreement or instrument
referred to herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be amended in any
respect, or any right under the Loan Documents or any other agreement or
instrument referred to herein or therein shall be amended or
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waived in any respect or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be released or exchanged in
whole or in part or otherwise dealt with;
(iv) any Lien or security interest granted to, or in favor of,
Issuing Bank or any Lender or Agent as security for any of the Guaranteed
Obligations shall fail to be perfected; or
(v) the release of any other Guarantor pursuant to SECTION 7.09.
The Guarantors hereby expressly waive diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that any
Secured Party exhaust any right, power or remedy or proceed against either
Borrower under this Agreement or the Notes, if any, or any other agreement or
instrument referred to herein or therein, or against any other person under any
other guarantee of, or security for, any of the Guaranteed Obligations. The
Guarantors waive any and all notice of the creation, renewal, extension, waiver,
termination or accrual of any of the Guaranteed Obligations and notice of or
proof of reliance by any Secured Party upon this Guarantee or acceptance of this
Guarantee, and the Guaranteed Obligations, and any of them, shall conclusively
be deemed to have been created, contracted or incurred in reliance upon this
Guarantee, and all dealings between the Borrowers and the Secured Parties shall
likewise be conclusively presumed to have been had or consummated in reliance
upon this Guarantee. This Guarantee shall be construed as a continuing,
absolute, irrevocable and unconditional guarantee of payment without regard to
any right of offset with respect to the Guaranteed Obligations at any time or
from time to time held by Secured Parties, and the obligations and liabilities
of the Guarantors hereunder shall not be conditioned or contingent upon the
pursuit by the Secured Parties or any other person at any time of any right or
remedy against either Borrower or against any other person which may be or
become liable in respect of all or any part of the Guaranteed Obligations or
against any collateral security or guarantee therefor or right of offset with
respect thereto. This Guarantee shall remain in full force and effect and be
binding in accordance with and to the extent of its terms upon the Guarantors
and the successors and assigns thereof, and shall inure to the benefit of the
Lenders, and their respective successors and assigns, notwithstanding that from
time to time during the term of this Agreement there may be no Guaranteed
Obligations outstanding.
SECTION 7.03 REINSTATEMENT. The obligations of the Guarantors
under this ARTICLE VII shall be automatically reinstated if and to the extent
that for any reason any payment by or on behalf of the Borrowers or other Loan
Party in respect of the applicable Guaranteed Obligations is rescinded or must
be otherwise restored by any holder of any of the applicable Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise.
SECTION 7.04 SUBROGATION; SUBORDINATION. Each Guarantor hereby
agrees that until the indefeasible payment and satisfaction in full in cash of
all applicable Guaranteed Obligations and the expiration and termination of the
Commitments of the Lenders under this Agreement it shall waive any claim and
shall not exercise any right or remedy, direct or indirect, arising by reason of
any performance by it of its guarantee in SECTION 7.01, whether by subrogation
or otherwise, against either Borrower or any other Guarantor of any of the
applicable Guaranteed Obligations or any security for any of the applicable
Guaranteed Obligations. Any Indebtedness of any Loan Party permitted pursuant to
SECTION 6.01(d) shall be subordinated to such Loan Party's Obligations in the
manner set forth in the Intercompany Note evidencing such Indebtedness.
SECTION 7.05 REMEDIES. The Guarantors jointly and severally agree
that, as between the Guarantors and the Lenders, the obligations of either
Borrower under this Agreement and the Notes, if any, may be declared to be
forthwith due and payable as provided in ARTICLE VIII (and shall be deemed to
have become automatically due and payable in the circumstances provided in said
ARTICLE VIII) for purposes of SECTION 7.01, notwithstanding any stay, injunction
or other prohibition preventing such
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declaration (or such obligations from becoming automatically due and payable) as
against either Borrower and that, in the event of such declaration (or such
obligations being deemed to have become automatically due and payable), such
obligations (whether or not due and payable by either Borrower) shall forthwith
become due and payable by the applicable Guarantors for purposes of SECTION
7.01.
SECTION 7.06 INSTRUMENT FOR THE PAYMENT OF MONEY. Each Guarantor
hereby acknowledges that the guarantee in this ARTICLE VII constitutes an
instrument for the payment of money, and consents and agrees that any Lender or
Agent, at its sole option, in the event of a dispute by such Guarantor in the
payment of any moneys due hereunder, shall have the right to bring a
motion-action under New York CPLR Section 3213.
SECTION 7.07 CONTINUING GUARANTEE. The guarantee in this ARTICLE
VII is a continuing guarantee of payment, and shall apply to all applicable
Guaranteed Obligations whenever arising.
SECTION 7.08 GENERAL LIMITATION ON GUARANTEE OBLIGATIONS. In any
action or proceeding involving any state corporate limited partnership or
limited liability company law, or any applicable state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under SECTION 7.01
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under SECTION 7.01, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without any
further action by such Guarantor, any Loan Party or any other person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.
SECTION 7.09 RELEASE OF GUARANTORS. If, in compliance with the
terms and provisions of the Loan Documents, all or substantially all of the
Equity Interests or property of any Guarantor are sold or otherwise transferred
(a "TRANSFERRED GUARANTOR") to a person or persons, none of which is U.S.
Borrower or a Subsidiary, such Transferred Guarantor shall, upon the
consummation of such sale or transfer, be released from its obligations under
this Agreement (including under SECTION 11.03 hereof) and its obligations to
pledge and grant any Collateral owned by it pursuant to any Security Document
and, in the case of a sale of all or substantially all of the Equity Interests
of the Transferred Guarantor, the pledge of such Equity Interests to the
Collateral Agent pursuant to the Security Documents shall be released, and the
Collateral Agent shall take such actions as are necessary to effect each release
described in this SECTION 7.09 in accordance with the relevant provisions of the
Security Documents.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 EVENTS OF DEFAULT. Upon the occurrence and during the
continuance of the following events ("EVENTS OF DEFAULT"):
(a) default shall be made in the payment of any principal of any
Loan or any Reimbursement Obligation when and as the same shall become due
and payable, whether at the due date thereof (including a Term Loan
Repayment Date) or at a date fixed for prepayment (whether voluntary or
mandatory) thereof or by acceleration thereof or otherwise;
(b) default shall be made in the payment of any interest on any
Loan or any Fee or any other amount (other than an amount referred to in
paragraph (a) above) due under any Loan
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Document, when and as the same shall become due and payable, and such
default shall continue unremedied for a period of three Business Days;
(c) any representation or warranty made or deemed made in or in
connection with any Loan Document or the borrowings or issuances of
Letters of Credit hereunder, or any representation, warranty, statement or
information contained in any report, certificate, financial statement or
other instrument furnished in connection with or pursuant to any Loan
Document, shall prove to have been false or misleading in any material
respect when so made, deemed made or furnished;
(d) default shall be made in the due observance or performance by
any Company of any covenant, condition or agreement contained in SECTION
5.02, 5.03(a) or 5.08 or in ARTICLE VI;
(e) default shall be made in the due observance or performance by
any Company of any covenant, condition or agreement contained in any Loan
Document (other than those specified in paragraphs (a), (b) or (d)
immediately above) and such default shall continue unremedied or shall not
be waived for a period of 30 days after written notice thereof from the
Administrative Agent or the Required Lenders to U.S. Borrower;
(f) any Company shall (i) fail to pay any principal or interest,
regardless of amount, due in respect of any Indebtedness (other than the
Obligations), when and as the same shall become due and payable beyond any
applicable grace period, or (ii) fail to observe or perform any other
term, covenant, condition or agreement contained in any agreement or
instrument evidencing or governing any such Indebtedness if the effect of
any failure referred to in this clause (ii) is to cause, or to permit the
holder or holders of such Indebtedness or a trustee or other
representative on its or their behalf (with or without the giving of
notice, the lapse of time or both) to cause, such Indebtedness to become
due prior to its stated maturity or become subject to a mandatory offer
purchase by the obligor; PROVIDED that it shall not constitute an Event of
Default pursuant to this paragraph (f) unless the aggregate amount of all
such Indebtedness referred to in clauses (i) and (ii) exceeds $10.0
million at any one time (PROVIDED that, in the case of Hedging
Obligations, the amount counted for this purpose shall be the amount
payable by all Companies if such Hedging Obligations were terminated at
such time);
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of any Company, or of a substantial part of the property
of any Company, under Title 11 of the Code, as now constituted or
hereafter amended, or any other federal, state or foreign bankruptcy,
insolvency, receivership or similar law; (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for any Company or for a substantial part of the property of any
Company; or (iii) the winding-up or liquidation of any Company; and such
proceeding or petition shall continue undismissed for 60 days or an order
or decree approving or ordering any of the foregoing shall be entered;
(h) any Company shall (i) voluntarily commence any proceeding or
file any petition seeking relief under Title 11 of the United States Code,
as now constituted or hereafter amended, or any other federal, state or
foreign bankruptcy, insolvency, receivership or similar law; (ii) consent
to the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or the filing of any petition described in clause
(g) above; (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for any
Company or for a substantial part of the property of any Company; (iv)
file an answer admitting the material allegations of a petition filed
against it in any such proceeding; (v) make a general
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assignment for the benefit of creditors; (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become
due; (vii) take any action for the purpose of effecting any of the
foregoing; or (viii) wind up or liquidate;
(i) one or more judgments, orders or decrees for the payment of
money in an aggregate amount in excess of $10.0 million shall be rendered
against any Company or any combination thereof and the same shall remain
undischarged, unvacated or unbonded for a period of 30 consecutive days
during which execution shall not be effectively stayed, or any action
shall be legally taken by a judgment creditor to levy upon properties of
any Company to enforce any such judgment;
(j) one or more ERISA Events or with respect to Foreign Plans
noncompliance with applicable legal requirements or Foreign Plan
underfunding shall have occurred that, in the reasonable opinion of the
Required Lenders, when taken together with all other such ERISA Events and
with respect to Foreign Plans noncompliance with applicable legal
requirements or Foreign Plan underfunding that have occurred, could
reasonably be expected to result in a Material Adverse Effect or the
imposition of a Lien on any properties of a Company;
(k) any security interest and Lien purported to be created by any
Security Document shall cease to be in full force and effect, or shall
cease to give the Collateral Agent, for the benefit of the applicable
Secured Parties, the Liens, rights, powers and privileges purported to be
created and granted under such Security Documents (including a perfected
first priority security interest in and Lien on, all of the Collateral
thereunder (except as otherwise expressly provided in such Security
Document)) in favor of the Collateral Agent, or shall be asserted by U.S.
Borrower or any other Loan Party not to be, a valid, perfected, first
priority (except as otherwise expressly provided in this Agreement or such
Security Document) security interest in or Lien on the Collateral covered
thereby;
(l) any Loan Document or any material provisions thereof shall at
any time and for any reason be declared by a court of competent
jurisdiction to be null and void, or a proceeding shall be commenced by
any Loan Party or any other person, or by any Governmental Authority,
seeking to establish the invalidity or unenforceability thereof (exclusive
of questions of interpretation of any provision thereof), or any Loan
Party shall repudiate or deny any portion of its liability or obligation
for the Obligations;
(m) there shall have occurred a Change in Control;
(n) the Acquisition shall not have occurred on the Closing Date in
accordance with the terms and conditions of the Acquisition Agreement; or
(o) the failure by either Borrower to make an Offer to Redeem when
and as required by SECTION 2.10.
then, and in every such event (other than an event with respect to Parent or
either Borrower described in paragraph (g) or (h) above), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Borrowers,
take either or both of the following actions, at the same or different times:
(i) terminate forthwith the Commitments and (ii) declare the Loans and
Reimbursement Obligations then outstanding to be forthwith due and payable in
whole or in part, whereupon the principal of the Loans and Reimbursement
Obligations so declared to be due and payable, together with accrued interest
thereon and any unpaid accrued Fees and all other liabilities of the Borrowers
accrued hereunder and under any other Loan Document, shall become
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forthwith due and payable, without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived by the Borrowers
and the Guarantors, anything contained herein or in any other Loan Document to
the contrary notwithstanding; and in any event, with respect to Parent or either
Borrower described in paragraph (g) or (h) above, the Commitments shall
automatically terminate and the principal of the Loans and Reimbursement
Obligations then outstanding, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrowers accrued hereunder
and under any other Loan Document, shall automatically become due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrowers and the Guarantors, anything
contained herein or in any other Loan Document to the contrary notwithstanding.
ARTICLE IX
COLLATERAL ACCOUNT; APPLICATION OF COLLATERAL PROCEEDS
SECTION 9.01 COLLATERAL ACCOUNT. (a) The Collateral Agent is
hereby authorized to establish and maintain at its office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, in the name of the Collateral Agent, a
restricted deposit account designated "Ply Gem Industries, Inc. U.S. Collateral
Account." Each U.S. Loan Party shall deposit into the U.S. Collateral Account
from time to time (i) the cash proceeds of any of the U.S. Security Agreement
Collateral (including pursuant to any disposition thereof) to the extent
contemplated herein or in any other Loan Document, (ii) the cash proceeds of any
Casualty Event with respect to U.S. Security Agreement Collateral, to the extent
contemplated herein or in any other Loan Document, and (iii) any cash such U.S.
Loan Party is required to pledge as additional collateral security hereunder
pursuant to the Loan Documents.
The Collateral Agent is hereby authorized to establish and maintain at
its office at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, in the name
of the Collateral Agent, a restricted deposit account designated "CWD Windows
and Doors, Inc. Canadian Collateral Account." Each Canadian Loan Party shall
deposit into the Canadian Collateral Account from time to time (i) the cash
proceeds of any of the Canadian Security Agreement Collateral (including
pursuant to any disposition thereof) to the extent contemplated herein or in any
other Loan Document, (ii) the cash proceeds of any Casualty Event with respect
to Canadian Security Agreement Collateral, to the extent contemplated herein or
in any other Loan Document, and (iii) any cash such Canadian Loan Party is
required to pledge as additional collateral security hereunder pursuant to the
Loan Documents.
(b) The balance from time to time in either Collateral Account
shall constitute part of the relevant Collateral and shall not constitute
payment of the Obligations until applied as hereinafter provided. So long as no
Event of Default has occurred and is continuing or will result therefrom, the
Collateral Agent shall within two Business Days of receiving a request of the
applicable Loan Party for release of cash proceeds (i) from the Collateral
Account constituting Net Cash Proceeds relating to any Casualty Event or Asset
Sale remit such cash proceeds on deposit in either Collateral Account to or upon
the order of such Loan Party, so long as such Loan Party has satisfied the
conditions relating thereto set forth in SECTION 9.02 and (ii) with respect to
the LC Sub-Account, remit such Net Cash Proceeds on deposit in the LC
Sub-Account to or upon the order of such U.S. Loan Party (x) at such time as all
Letters of Credit shall have been terminated and all of the liabilities in
respect of the Letters of Credit have been paid in full or (y) otherwise in
accordance with SECTION 2.18(i). At any time following the occurrence and during
the continuance of an Event of Default, the Collateral Agent may (and, if
instructed by the Required Lenders as specified herein, shall) in its (or their)
discretion apply or cause to be applied (subject to collection) the balance from
time to time outstanding to the credit of either Collateral Account to the
payment of the applicable Obligations in the manner specified in SECTION 9.03
hereof subject, however, in the case of amounts deposited in the LC Sub-Account,
to the provisions of SECTIONS 2.18(i) and 9.03. The
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Loan Parties shall have no right to withdraw, transfer or otherwise receive any
funds deposited in either Collateral Account except to the extent specifically
provided herein.
(c) Amounts on deposit in either Collateral Account shall be
invested and reinvested from time to time in Cash Equivalents as the applicable
Loan Party (or, after the occurrence and during the continuance of an Event of
Default, the Collateral Agent) shall determine by written instruction to the
Collateral Agent, or if no such instructions are given, then as the Collateral
Agent, in its sole discretion, shall determine which Cash Equivalents shall be
held in the name and be under the control of the Collateral Agent (or any
sub-agent); PROVIDED that at any time after the occurrence and during the
continuance of an Event of Default, the Collateral Agent may (and, if instructed
by the Required Lenders as specified herein, shall) in its (or their) discretion
at any time and from time to time elect to liquidate any such Cash Equivalents
and to apply or cause to be applied the proceeds thereof to the payment of the
applicable Obligations in the manner specified in SECTION 9.03 hereof subject,
however, in the case of amounts deposited in the LC Sub-Account, to the
provisions of SECTION 2.18(i).
(d) Amounts deposited into the U.S. Collateral Account as cover
for liabilities in respect of Letters of Credit under any provision of this
Agreement requiring such cover shall be held by the Administrative Agent in a
separate sub-account designated as the "LC Sub-Account" (the "LC SUB-ACCOUNT")
and, subject to SECTION 2.18(I), all amounts held in the LC Sub-Account shall
constitute collateral security to be applied in accordance with SECTION 2.18(i).
(e) Earnings on the amounts deposited in any Collateral Account
shall be for the account of the applicable Loan Party and absent any Default
will be released to the applicable Borrower upon its request.
SECTION 9.02 PROCEEDS OF DESTRUCTION, TAKING AND COLLATERAL
DISPOSITIONS. So long as no Event of Default shall have occurred and be
continuing, in the event the applicable Loan Party elects to reinvest Net Cash
Proceeds in respect of any Asset Sale or Casualty Event in accordance with the
provisions of SECTIONS 2.10(c) and 2.10(f) as applicable, the Collateral Agent
shall receive at least 10 days' prior notice of each request for payment and
shall not release any part of such Net Cash Proceeds, until the applicable Loan
Party has furnished to the Collateral Agent (i) an Officers' Certificate setting
forth: (A) a brief description of the reinvestment to be made, (B) the dollar
amount of the expenditures to be made, or costs incurred by such Loan Party in
connection with such reinvestment and (C) evidence that the properties acquired
in connection with such reinvestment have a fair market value at least equal to
the amount of such Net Cash Proceeds requested to be released from the
applicable Collateral Account and (ii) all security agreements and Mortgages and
other items required by the provisions of SECTIONS 5.10 and 5.11 to, among other
things, subject such reinvestment properties to the Lien of the Security
Documents in favor of the Collateral Agent, for its benefit and for the benefit
of the other Secured Parties.
SECTION 9.03 APPLICATION OF PROCEEDS. The proceeds received by the
Collateral Agent in respect of any sale of, collection from or other realization
upon all or any part of the Collateral pursuant to the exercise by the
Collateral Agent of its remedies shall be applied, in full or in part, together
with any other sums then held by the Collateral Agent pursuant to this
Agreement, promptly by the Collateral Agent as follows:
(a) FIRST, to the payment of all reasonable costs and expenses,
fees, commissions and taxes of such sale, collection or other realization
including compensation to the Collateral Agent and its agents and counsel,
and all expenses, liabilities and advances made or incurred by the
Collateral Agent in connection therewith and all amounts for which the
Collateral Agent is entitled to indemnification pursuant to the provisions
of any Loan Document, together with interest on each
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such amount at the highest rate then in effect under this Agreement from
and after the date such amount is due, owing or unpaid until paid in full;
(b) SECOND, to the payment of all other reasonable costs and
expenses of such sale, collection or other realization including
compensation to the other applicable Secured Parties and their agents and
counsel and all costs, liabilities and advances made or incurred by the
other applicable Secured Parties in connection therewith, together with
interest on each such amount at the highest rate then in effect under this
Agreement from and after the date such amount is due, owing or unpaid
until paid in full;
(c) THIRD, without duplication of amounts applied pursuant to
clauses (a) and (b) above, to the indefeasible payment in full in cash,
PRO RATA, of interest and other amounts constituting applicable
Obligations (other than principal and Reimbursement Obligations) in each
case equally and ratably in accordance with the respective amounts thereof
then due and owing;
(d) FOURTH, to the indefeasible payment in full in cash, PRO RATA,
of principal amount of the applicable Obligations (including Reimbursement
Obligations); and
(e) FIFTH, the balance, if any, to the person lawfully entitled
thereto (including the applicable Loan Party or its successors or assigns)
or as a court of competent jurisdiction may direct.
In the event that any such proceeds are insufficient to pay in full the
items described in clauses (a) through (e) of this SECTION 9.03, the applicable
Loan Parties shall remain liable, jointly and severally, for any deficiency.
ARTICLE X
THE AGENTS
SECTION 10.01 APPOINTMENT. Each Lender hereby irrevocably
designates and appoints each of the Administrative Agent and the Collateral
Agent as an agent of such Lender under this Agreement and the other Loan
Documents. Each Lender irrevocably authorizes each Agent, in such capacity,
through its agents or employees, to take such actions on its behalf under the
provisions of this Agreement and the other Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to such Agent by the
terms of this Agreement and the other Loan Documents, together with such actions
and powers as are reasonably incidental thereto.
SECTION 10.02 AGENT IN ITS INDIVIDUAL CAPACITY. Each person serving
as an Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not an
Agent, and such person and its Affiliates may accept deposits from, lend money
to and generally engage in any kind of business with U.S. Borrower or any
Subsidiary or other Affiliate thereof as if it were not an Agent hereunder.
SECTION 10.03 EXCULPATORY PROVISIONS. No Agent shall have any
duties or obligations except those expressly set forth in the Loan Documents.
Without limiting the generality of the foregoing, (a) no Agent shall be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) no Agent shall have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated by the Loan Documents that such Agent
is required to exercise in writing by the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in SEC-
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TION 11.02), and (c) except as expressly set forth in the Loan Documents, no
Agent shall have any duty to disclose or shall be liable for the failure to
disclose, any information relating to U.S. Borrower or any of its Subsidiaries
that is communicated to or obtained by the bank serving as such Agent or any of
its Affiliates in any capacity. No Agent shall be liable for any action taken or
not taken by it with the consent or at the request of the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in SECTION 11.02) or in the absence of its own gross
negligence or willful misconduct. No Agent shall be deemed to have knowledge of
any Default unless and until written notice thereof is given to such Agent by a
Borrower or a Lender, and no Agent shall be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with any Loan Document, (ii) the contents of any certificate,
report or other document delivered thereunder or in connection therewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document or (v) the satisfaction of any condition set forth in
ARTICLE IV or elsewhere in any Loan Document.
SECTION 10.04 RELIANCE BY AGENT. Each Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by a proper person.
Each Agent also may rely upon any statement made to it orally and believed by it
to be made by a proper person, and shall not incur any liability for relying
thereon. Each Agent may consult with legal counsel (who may be counsel for
either Borrower), independent accountants and other advisors selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or advisors.
SECTION 10.05 DELEGATION OF DUTIES. Each Agent may perform any and
all its duties and exercise its rights and powers by or through any one or more
sub-agents appointed by such Agent. Each Agent and any such sub-agent may
perform any and all its duties and exercise its rights and powers through their
respective Affiliates. The exculpatory provisions of the preceding paragraphs
shall apply to any such sub-agent and to the Affiliates of each Agent and any
such sub-agent, and shall apply to their respective activities in connection
with the syndication of the credit facilities provided for herein as well as
activities as Agent.
SECTION 10.06 SUCCESSOR AGENT. Each Agent may resign as such at any
time upon at least 30 days' prior notice to the Lenders, the Issuing Bank and
U.S. Borrower. Upon any such resignation, the Required Lenders shall have the
right, with, if no Default shall have occurred and be continuing, the consent of
Borrower (such consent not to be unreasonably withheld), to appoint a successor
Agent from among the Lenders. If no successor shall have been so appointed by
the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Agent gives notice of its resignation, then the retiring
Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor
Agent, which successor shall be a commercial banking institution organized under
the laws of the United States (or any State thereof) or a United States branch
or agency of a commercial banking institution, in each case, having combined
capital and surplus of at least $250 million; PROVIDED that if such retiring
Agent is unable to find a commercial banking institution which is willing to
accept such appointment and which meets the qualifications set forth above, the
retiring Agent's resignation shall nevertheless thereupon become effective, and
the Lenders shall assume and perform all of the duties of the Agent hereunder
until such time, if any, as the Required Lenders appoint a successor Agent.
Upon the acceptance of its appointment as an Agent hereunder by a
successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. The fees
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payable by U.S. Borrower to a successor Agent shall be the same as those payable
to its predecessor unless otherwise agreed between U.S. Borrower and such
successor. After an Agent's resignation hereunder, the provisions of this
ARTICLE X and SECTION 11.03 shall continue in effect for the benefit of such
retiring Agent, its sub-agents and their respective Affiliates in respect of any
actions taken or omitted to be taken by any of them while it was acting as
Agent.
SECTION 10.07 NON-RELIANCE ON AGENT AND OTHER LENDERS. Each Lender
acknowledges that it has, independently and without reliance upon any Agent or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon any Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or related agreement or any document furnished hereunder
or thereunder.
SECTION 10.08 NAME AGENTS. The parties hereto acknowledge that the
Co-Documentation Agents and the Syndication Agent hold such titles in name only,
and that such titles confer no additional rights or obligations relative to
those conferred on any Lender hereunder.
SECTION 10.09 INDEMNIFICATION. The Lenders severally agree to
indemnify each Agent in its capacity as such (to the extent not reimbursed by
the Borrowers or the Guarantors and without limiting the obligation of the
Borrowers or the Guarantors to do so), ratably according to their respective
outstanding Loans and Commitments in effect on the date on which indemnification
is sought under this SECTION 10.09 (or, if indemnification is sought after the
date upon which all Commitments shall have terminated and the Loans and
Reimbursement Obligations shall have been paid in full, ratably in accordance
with such outstanding Loans and Commitments as in effect immediately prior to
such date), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever that may at any time (whether before or after the payment
of the Loans and Reimbursement Obligations) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; PROVIDED that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent's gross negligence or
willful misconduct. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 NOTICES. Notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopy, as
follows:
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(a) if to any Loan Party, to U.S. Borrower at:
Ply Gem Industries, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇;
(b) if to the Administrative Agent, the Collateral Agent or the
Issuing Bank, to it at:
UBS AG, Stamford Branch
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vladimira Holeckova
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇;
(c) if to a Lender, to it at its address (or telecopy number) set
forth on the applicable Lender Addendum or in the Assignment and
Assumption pursuant to which such Lender shall have become a party hereto;
and
(d) if to the Swingline Lender, to it at:
UBS Loan Finance LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vladimira Holeckova
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or by certified or registered mail, in each case delivered, sent or
mailed (properly addressed) to such party as provided in this SECTION 11.01 or
in accordance with the latest unrevoked direction from such party given in
accordance with this SECTION 11.01, and failure to deliver courtesy copies of
notices and other communications shall in no event affect the validity or
effectiveness of such notices and other communications.
SECTION 11.02 WAIVERS; AMENDMENT. (a) No failure or delay by any
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of each Agent, the Issuing Bank and the Lenders hereunder and under
the other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of any Loan
Document or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this
Section, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. Without limiting the generality of
the foregoing, the making of a Loan or issuance of a Letter of Credit shall not
be construed as a waiver of any Default, regardless of whether any Agent, any
Lender or the Issuing Bank may have had notice or knowledge of such Default at
the time.
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(b) Except as provided in paragraph (d) below, neither this
Agreement nor any other Loan Document nor any provision hereof or thereof may be
waived, amended, supplemented or modified except, in the case of this Agreement,
pursuant to an agreement or agreements in writing entered into by the Borrowers
and the Required Lenders or, in the case of any other Loan Document, pursuant to
an agreement or agreements in writing entered into by the Administrative Agent,
the Collateral Agent (in the case of any Security Document) and the Loan Party
or Loan Parties that are parties thereto, in each case with the written consent
of the Required Lenders; PROVIDED that no such agreement shall:
(i) increase the Commitment of any Lender without the written
consent of such Lender;
(ii) reduce the principal amount or premium of any Loan or LC
Disbursement or reduce the rate of interest thereon, or reduce any Fees
payable hereunder, or change the currency of payment of any Obligation,
without the written consent of each Lender affected thereby;
(iii) postpone or extend the maturity of any Loan, or any scheduled
date of payment of or the installment otherwise due on the principal
amount of any Term Loan under SECTION 2.09, or the required date of
payment of any Reimbursement Obligation, or any date for the payment of
any interest or fees payable hereunder, or reduce the amount of, waive or
excuse any such payment (except interest payable under SECTION 2.06(c)),
or postpone the scheduled date of expiration of any Commitment or postpone
the scheduled date of expiration of any Letter of Credit beyond the
Revolving Maturity Date, without the written consent of each Lender
affected thereby;
(iv) change SECTION 2.14(b) or (c) in a manner that would alter the
PRO RATA sharing of payments or setoffs required thereby, without the
written consent of each Lender;
(v) change the percentage set forth in the definition of "Required
Lenders" or any other provision of any Loan Document (including this
Section) specifying the number or percentage of Lenders (or Lenders of any
Class) required to waive, amend or modify any rights thereunder or make
any determination or grant any consent thereunder, without the written
consent of each Lender (or each Lender of such Class, as the case may be);
(vi) release any Guarantor from its Guarantee (except as expressly
provided in ARTICLE VII), or limit its liability in respect of such
Guarantee, without the written consent of each Lender;
(vii) release all or a substantial portion of the Collateral from
the Liens of the Security Documents or alter the relative priorities of
the Obligations entitled to the Liens of the Security Documents (except in
connection with securing additional Obligations equally and ratably with
the other Obligations), in each case without the written consent of each
Lender;
(viii) change any provisions of any Loan Document in a manner that by
its terms adversely affects the rights in respect of payments due to
Lenders holding Loans of any Class differently than those holding Loans of
any other Class, without the written consent of Lenders holding a majority
in interest of the outstanding Loans and unused Commitments of each
affected Class;
(ix) without the consent of the Required Lenders and Term Loan
Lenders holding more than 50% of the principal amount of the outstanding
Term Loans, reduce the amount of, or extend the date of, any scheduled
payment on the Term Loans required to be made under SECTION 2.09, change
the order of application of prepayments among Term Loans and Revolving
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Commitments under SECTION 2.10(h) or change the application of prepayments
of Term Loans set forth in SECTION 2.10(h) to the remaining scheduled
amortization payments to be made thereon under SECTION 2.09; or
(x) without the consent of Term Loan Lenders holding more than 50%
of the principal amount of each of the outstanding U.S. Term Loans and
Canadian Term Loans, change the order of application of prepayments
amounts of the U.S. Term Loans and the Canadian Term Loans under SECTION
2.10(h);
PROVIDED, FURTHER, that (1) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, the Collateral Agent,
the Issuing Bank or the Swingline Lender without the prior written consent of
the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case
may be, (2) any waiver, amendment or modification of this Agreement that by its
terms affects the rights or duties under this Agreement of the Revolving Lenders
(but not the Term Loan Lenders), the Term Loan Lenders (but not the Revolving
Lenders), or one Class of Term Loan Lenders (but no other Lenders) may be
effected by an agreement or agreements in writing entered into by the Borrowers
and requisite percentage in interest of the affected Class of Lenders that would
be required to consent thereto under this Section if such Class of Lenders were
the only Class of Lenders hereunder at the time, and (3) any waiver, amendment
or modification prior to the completion of the primary syndication of the
Commitments and Loans (as determined by the Administrative Agent) may not be
effected without the written consent of the Administrative Agent.
Notwithstanding the foregoing, any provision of this Agreement may be amended by
an agreement in writing entered into by the Borrowers, the Required Lenders and
the Administrative Agent (and, if their rights or obligations are affected
thereby, the Issuing Bank and the Swingline Lender) if (x) by the terms of such
agreement the Commitment of each Lender not consenting to the amendment provided
for therein shall terminate upon the effectiveness of such amendment and (y) at
the time such amendment becomes effective, each Lender not consenting thereto
receives payment in full of the principal of, premium, if any, and interest
accrued on each Loan made by it and all other amounts owing to it or accrued for
its account under this Agreement.
(c) If, in connection with any proposed change, waiver, discharge
or termination of the provisions of this Agreement as contemplated by SECTION
11.02(b), the consent of the Required Lenders is obtained but the consent of one
or more of such other Lenders whose consent is required is not obtained, then
the Borrowers shall have the right to replace all, but not less than all, of
such non-consenting Lender or Lenders (so long as all non-consenting Lenders are
so replaced) with one or more persons pursuant to SECTION 2.16 so long as at the
time of such replacement each such new Lender consents to the proposed change,
waiver, discharge or termination.
(d) Notwithstanding anything in SECTION 11.02(b) to the contrary,
this Agreement and the other Loan Documents may be amended at any time and from
time to time to increase the aggregate principal amount of U.S. Term Loans or to
establish additional Classes of U.S. Term Loans (collectively, "ADDITIONAL TERM
LOANS") by an agreement in writing entered into by the Borrowers, the
Administrative Agent, the Collateral Agent and each person (including any
Lender) that shall agree to make an Additional Term Loan (and each such person
that shall not already be a Lender shall be reasonably acceptable to the
Administrative Agent and shall, at the time such agreement becomes effective,
become a Lender with the same effect as if it had originally been a Lender under
this Agreement with the Term Loans set forth in such agreement); PROVIDED that
(1) no more than an amount equal to $50.0 million of Additional Term Loans less
the principal amount of all Senior Subordinated Notes issued after the Closing
Date pursuant to SECTION 6.01(b) may be established pursuant to this SECTION
11.02(d) without the consent of the Required Lenders, (2) no Default or Event of
Default has occurred and is continuing or would occur after giving effect
thereto, (3) the covenants in SECTION 6.10 would be satisfied on a Pro Forma
Basis on the date of any such amendment and for the most recent Test Period,
after giving effect to
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such Additional Term Loans, and (4) the Senior Leverage Ratio would not be
greater than 2.5:1.0 after giving effect thereto. Any such agreement shall be
reasonably satisfactory to the Administrative Agent, shall amend the provisions
of this Agreement and the other Loan Documents and shall set forth the terms of
the Additional Term Loans established thereby (including the amount and final
maturity thereof (which shall not be earlier than the Term Loan Maturity Date),
any provisions relating to the amortization or mandatory prepayment thereof
(which shall be no more than ratable or PARI PASSU, as applicable, with the Term
Loans), the interest to accrue and be payable thereon and any fees to be payable
in respect thereof (PROVIDED that the Applicable Margins with respect to any
Additional Term Loans shall not be more than 25 basis points higher than the
Applicable Margins with respect to the Term Loans and that all other payment
rights shall be pari passu with the Term Loans)) and effect such other changes
(including changes to the provisions of this Section, SECTION 2.14 and the
definition of "Required Lenders") as U.S. Borrower and the Administrative Agent
shall deem necessary or advisable in connection with the Additional Term Loans;
PROVIDED that no such agreement shall (i) effect any change described in SECTION
11.02(b) (i) through (ix) without the consent of each person required to consent
to such change under such clause (it being agreed, however, that the Additional
Term Loans will not, of themselves, be deemed to effect any of the changes
described in SECTION 11.02(b)(vi) THROUGH (viii) and (1)), (ii) amend ARTICLE V,
VI or VIII to establish any affirmative or negative covenant, Event of Default
or remedy that by its terms benefits one or more Classes, but not all Classes,
of Loans or Borrowings without the prior written consent of Lenders holding a
majority in interest of the Loans and Commitments of each Class not so benefited
(it being agreed that no provision requiring either Borrower to prepay Term
Loans of one or more Classes pursuant to SECTIONS 2.10(c) through (h) shall be
deemed to violate this clause) or (iii) change any other provision of this
Agreement or any other Loan Document that creates rights in favor of Lenders
holding Loans or Commitments of any existing Class, other than as necessary or
advisable in the judgment of the Administrative Agent to cause such provision to
take into account, or to make the benefits of such provision available to,
Lenders holding Additional Term Loans. The Loans and Borrowings established
pursuant to this paragraph shall constitute Loans and Borrowings under, and
shall be entitled to all the benefits afforded by, this Agreement and the other
Loan Documents, and shall, without limiting the foregoing, benefit equally and
ratably from the Guarantees and security interests created by the Security
Documents. The Loan Parties shall take any actions reasonably required by the
Administrative Agent to ensure and/or demonstrate that the Lien and security
interests granted by the Security Documents continue to be perfected under the
UCC or otherwise after the establishment of any such Additional Term Loans.
(e) Notwithstanding anything in this Agreement to the contrary,
any Offer to Redeem shall be accepted by all Lenders to which such Offer to
Redeem was made unless three Business Days prior to the proposed redemption date
the Required Lenders give their consent for such Offer to Redeem to be declined
by all such Lenders.
SECTION 11.03 EXPENSES; INDEMNITY. (a) The Loan Parties agree,
jointly and severally, to pay, promptly upon demand:
(i) all reasonable costs and expenses incurred by the Arrangers,
the Administrative Agent, the Collateral Agent, the Swingline Lender and
the Issuing Bank, including the reasonable fees, charges and disbursements
of Advisors for the Arrangers, the Administrative Agent, the Collateral
Agent, the Swingline Lender and the Issuing Bank, in connection with the
syndication of the Loans and Commitments, the preparation, execution and
delivery of the Loan Documents, the administration of the Loans and
Commitments, the perfection and maintenance of the Liens securing the
Collateral and any actual or proposed amendment, supplement or waiver of
any of the Loan Documents (whether or not the transactions contemplated
hereby or thereby shall be consummated);
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(ii) all costs and expenses incurred by the Administrative Agent or
the Collateral Agent, including the reasonable fees, charges and
disbursements of Advisors for the Administrative Agent and the Collateral
Agent, in connection with any action, suit or other proceeding affecting
the Collateral or any part thereof, in which action, suit or proceeding
the Administrative Agent or the Collateral Agent is made a party or
participates or in which the right to use the Collateral or any part
thereof is threatened, or in which it becomes necessary in the judgment of
the Administrative Agent or the Collateral Agent to defend or uphold the
Liens granted by the Security Documents (including any action, suit or
proceeding to establish or uphold the compliance of the Collateral with
any Requirements of Law);
(iii) all costs and expenses incurred by the Arrangers, the
Administrative Agent, the Collateral Agent, the Swingline Lender, the
Issuing Bank or any Lender, including the reasonable fees, charges and
disbursements of Advisors for the Arrangers, the Administrative Agent, the
Collateral Agent, the Swingline Lender, the Issuing Bank or any Lender,
incurred in connection with the enforcement or protection of its rights
under the Loan Documents, including its rights under this SECTION
11.03(a), or in connection with the Loans made or Letters of Credit issued
hereunder and the collection of the Obligations, including all such costs
and expenses incurred during any workout, restructuring or negotiations in
respect of the Obligations; and
(iv) all documentary and similar taxes and charges in respect of
the Loan Documents.
For purposes of this SECTION 11.03(a), "ADVISORS" shall mean legal counsel
(including local counsel), auditors, accountants, consultants, appraisers or
other advisors; PROVIDED that (x) in the case of clause (i), the engagement of
any Advisors other than legal counsel (including local counsel) shall be subject
to approval by U.S. Borrower (which approval shall not be unreasonably withheld)
and (y) in the case of clause (iii), the engagement of any Advisors other than
one firm of legal counsel by any Lender shall be subject to approval by the
Administrative Agent.
(b) The Loan Parties agree, jointly and severally, to indemnify
the Agents, each Lender, the Issuing Bank and the Swingline Lender, each
Affiliate of any of the foregoing persons and each of their respective partners,
controlling persons, directors, officers, trustees, employees and agents (each
such person being called an "INDEMNITEE") against, and to hold each Indemnitee
harmless from, all reasonable out-of-pocket costs and any and all losses,
claims, damages, liabilities, penalties, judgments, suits and related expenses,
including reasonable counsel fees, charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or as
a result of (i) the execution, delivery, performance, administration or
enforcement of the Loan Documents, (ii) any actual or proposed use of the
proceeds of the Loans or issuance of Letters of Credit, (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, or (iv) any actual or alleged
presence or Release or threatened Release of Hazardous Materials, on, at, under
or from any property owned, leased or operated by any Company at any time, or
any Environmental Claim related in any way to any Company; PROVIDED that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted solely from the gross negligence or willful misconduct of such
Indemnitee.
(c) The provisions of this SECTION 11.03 shall remain operative
and in full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of the Loans and Reimbursement Obligations, the release of all or any
portion of the Collateral, the expiration of the Commitments, the expiration of
any Letter of Credit, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Agents, the Issuing Bank or any Lender. All
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amounts due under this SECTION 11.03 shall be payable on written demand therefor
accompanied by reasonable documentation with respect to any reimbursement,
indemnification or other amount requested.
(d) To the extent that either Borrower fails to promptly pay any
amount required to be paid by it to the Agents, the Issuing Bank or the
Swingline Lender under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Agents, the Issuing Bank or the Swingline Lender,
as the case may be, such Lender's PRO RATA share (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount; PROVIDED that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against any of the Agents, the Issuing Bank or the Swingline Lender
in its capacity as such. For purposes hereof, a Lender's "PRO RATA share" shall
be determined based upon its share of the sum of the total Revolving Exposure,
outstanding Term Loans and unused Commitments at the time.
SECTION 11.04 SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that the
Borrowers may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of the Administrative Agent, the
Collateral Agent, the Issuing Lender, the Swingline Lender and each Lender (and
any attempted assignment or transfer by either Borrower without such consent
shall be null and void). Nothing in this Agreement, express or implied, shall be
construed to confer upon any person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit) and, to the extent expressly
contemplated hereby, the other Indemnitees) any legal or equitable right, remedy
or claim under or by reason of this Agreement.
(b) Any Lender shall have the right at any time to assign to one
or more banks, insurance companies, investment companies or funds or other
institutions (other than the Borrowers, Parent or any Subsidiary thereof) all or
a portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); PROVIDED that
(i) except in the case of an assignment to a Lender, an Affiliate of a Lender or
a Lender Affiliate, the Administrative Agent and U.S. Borrower (and, in the case
of an assignment of all or a portion of a Revolving Commitment or any Lender's
obligations in respect of its LC Exposure or Swingline Exposure, the Issuing
Bank and the Swingline Lender) must give its prior written consent to such
assignment (which consents shall not be unreasonably withheld or delayed), (ii)
except in the case of an assignment to a Lender, an Affiliate of a Lender or a
Lender Affiliate, any assignment made in connection with the syndication of the
Commitments and Loans by the Arrangers or an assignment of the entire remaining
amount of the assigning Lender's Commitment or Loans, the amount of the
Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than $2.5
million unless each of U.S. Borrower and the Administrative Agent otherwise
consents, (iii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement, except that this clause (iii) shall not be construed to prohibit
the assignment of a proportionate part of all the assigning Lender's rights and
obligations in respect of one Class of Commitments or Loans other than an
assignment of any rights and obligations with respect to any Term Loans which
may be assigned only on a PRO RATA basis between U.S. Term Loans and Canadian
Term Loans (I.E., an assignment of U.S. Term Loans representing a percentage of
the total principal amount of U.S. Term Loans then outstanding shall be
accompanied by an assignment of Canadian Term Loans representing the same
percentage of the total principal amount of Canadian Term Loans then
outstanding), (iv) the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500, (v) the assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire and (vi) in the case of an assignment
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to an Affiliate of Parent, such Affiliate hereby agrees that, unless it holds
all Loans of the applicable Class, its Loans and Commitments shall be
disregarded for purposes of determining the requisite percentage or number of
Lenders (or Lenders of any Class) required to waive, amend or modify any rights
under any Loan Document or make any determination or grant any consent
thereunder; and PROVIDED, FURTHER, that any consent of U.S. Borrower otherwise
required under this paragraph shall not be required if a Default has occurred
and is continuing or during the primary syndication of the Commitments. Subject
to acceptance and recording thereof pursuant to paragraph (d) of this Section,
from and after the effective date specified in each Assignment and Assumption
the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement (PROVIDED that any liability of
either Borrower to such assignee under SECTION 2.12 or 2.13 shall be limited to
the amount, if any, that would have been payable thereunder by such Borrower in
the absence of such assignment, except to the extent any such amounts are
attributable to a Change in Law occurring after the date of such assignment),
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of SECTIONS 2.12, 2.13, 2.15 and 11.03).
(c) The Administrative Agent, acting for this purpose as an agent
of the Borrowers, shall maintain at one of its offices a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitment of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall be
conclusive in the absence of manifest error, and the Borrowers, the
Administrative Agent, the Issuing Bank and the Lenders may treat each person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrowers, the
Issuing Bank, the Collateral Agent, the Swingline Lender and any Lender (with
respect to its own interest only), at any reasonable time and from time to time
upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
(e) Any Lender shall have the right at any time, without the
consent of either Borrower, the Administrative Agent, the Issuing Bank or the
Swingline Lender, to sell participations to one or more banks or other entities
(a "PARTICIPANT") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
owing to it); PROVIDED that (i) such Lender's obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) the
Borrowers, the Administrative Agent, the Issuing Bank 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. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment, modification or waiver of any provision of the Loan
Documents; PROVIDED that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in clause (i), (ii) or (iii) of the first
proviso to SEC-
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TION 11.02(b) that affects such Participant. Subject to paragraph (f) of this
Section, the Borrowers agree that each Participant shall be entitled to the
benefits of SECTIONS 2.12, 2.13 and 2.15, so long as such Participant complies
with the requirements of each such Section, to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of SECTION 11.08 as though it were a Lender; PROVIDED
that such Participant agrees in writing to be subject to SECTION 2.14(c) as
though it were a Lender. Each Lender shall, acting for this purpose as an agent
of the Borrowers, maintain at one of its offices a register for the recordation
of the names and addresses of its Participants, and the amount and terms of its
participations; PROVIDED that no Lender shall be required to disclose or share
the information contained in such register with the Borrowers or any other
party, except as required by applicable law.
(f) A Participant shall not be entitled to receive any greater
payment under SECTION 2.12, 2.13 or 2.15 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the prior written consent of the applicable Borrower (which consent shall
not be unreasonably withheld or delayed).
(g) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; PROVIDED that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto. In the case of any Lender that is a fund that invests in bank
loans, such Lender may, without the consent of the Borrowers or the
Administrative Agent, collaterally assign or pledge all or any portion of its
rights under this Agreement, including the Loans and Notes or any other
instrument evidencing its rights as a Lender under this Agreement, to any holder
of, trustee for, or any other representative of holders of, obligations owed or
securities issued, by such fund, as security for such obligations or securities.
SECTION 11.05 SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents
and in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Agents, the
Issuing Bank or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated. The
provisions of SECTIONS 2.12, 2.14, 2.15 and 11.03 and ARTICLE X shall survive
and remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the payment of the
Reimbursement Obligations, the expiration or termination of the Letters of
Credit and the Commitments or the termination of this Agreement or any provision
hereof.
SECTION 11.06 COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement,
the other Loan Documents and the Fee Letter constitute the entire contract among
the parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the subject
matter hereof. This Agreement shall become effective when it shall
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have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 11.07 SEVERABILITY. Any provision of this Agreement held to
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 11.08 RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates are hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of either
Borrower against any and all of the obligations of such Borrower now or
hereafter existing under this Agreement held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement and
although such obligations may be unmatured. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of
setoff) which such Lender may have.
SECTION 11.09 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York, without regard to conflicts of law
principles that would require the application of the laws of another
jurisdiction.
(b) Each Loan Party hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to any Loan Document, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such federal court. Each of the parties hereto 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.
Nothing in this Agreement or any other Loan Document shall affect any right that
the Administrative Agent, the Issuing Bank or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against any Loan Party or its properties in the courts of any
jurisdiction.
(c) Each Loan Party hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in SECTION 11.09(b). Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(d) Each party to this Agreement irrevocably consents to service
of process in any action or proceeding arising out of or relating to any Loan
Document, in the manner provided for notices (other than telecopy) in SECTION
11.01. Nothing in this Agreement or any other Loan Document will af-
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fect the right of any party to this Agreement to serve process in any other
manner permitted by applicable law.
SECTION 11.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 11.11 HEADINGS. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 11.12 CONFIDENTIALITY. Each of the Administrative Agent,
the Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates' and Lender Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential pursuant to the terms hereof), (b) to the extent
requested by any regulatory or self-regulatory authority, (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (d) to any other party to this Agreement, (e) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating to
this Agreement or any other Loan Document or the enforcement of rights hereunder
or thereunder, (f) subject to an agreement containing provisions substantially
the same as those of this SECTION 11.12, to (i) any assignee of or Participant
in, or any prospective assignee of or Participant in, any of its rights or
obligations under this Agreement, (ii) any actual or prospective counterparty
(or its advisors) to any swap or derivative transaction relating to the
applicable Borrower and its obligations or (iii) any rating agency for the
purpose of obtaining a credit rating applicable to any Loan or Loan Party, (g)
with the consent of U.S. Borrower or (h) to the extent such Information (i) is
publicly available at the time of disclosure or becomes publicly available other
than as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
from a source other than U.S. Borrower or any Subsidiary. For the purposes of
this Section, "INFORMATION" means all information received from U.S. Borrower or
any Subsidiary relating to U.S. Borrower or any Subsidiary or its business that
is clearly identified at the time of delivery as confidential, other than any
such information that is available to the Administrative Agent, the Issuing Bank
or any Lender on a nonconfidential basis prior to disclosure by U.S. Borrower or
any Subsidiary. Any person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such person has exercised the same degree of
care to maintain the confidentiality of such Information as such person would
accord to its own confidential information.
SECTION 11.13 INTEREST RATE LIMITATION. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively, the "CHARGES"),
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shall exceed the maximum lawful rate (the "MAXIMUM RATE") which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or periods
shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.
SECTION 11.14 LENDER ADDENDUM. Each Lender to become a party to
this Agreement on the date hereof shall do so by delivering to the
Administrative Agent a Lender Addendum duly executed by such Lender, the
applicable Borrower and the Administrative Agent.
SECTION 11.15 OBLIGATIONS ABSOLUTE. To the fullest extent permitted
by applicable law, all obligations of the Loan Parties hereunder shall be
absolute and unconditional irrespective of:
(a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of any Loan Party;
(b) any lack of validity or enforceability of any Loan Document or
any other agreement or instrument relating thereto against any Loan Party;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations, or any other amendment
or waiver of or any consent to any departure from any Loan Document or any
other agreement or instrument relating thereto;
(d) any exchange, release or non-perfection of any other
Collateral, or any release or amendment or waiver of or consent to any
departure from any guarantee, for all or any of the Obligations;
(e) any exercise or non-exercise, or any waiver of any right,
remedy, power or privilege under or in respect hereof or any Loan
Document; or
(f) any other circumstances which might otherwise constitute a
defense available to, or a discharge of, the Loan Parties, except for the
defense of payment or performance of such obligations.
SECTION 11.16 JUDGMENT CURRENCY. (a) Each Borrower's obligation
hereunder and under the other Loan Documents to make payments in dollars shall
not be discharged or satisfied by any tender or recovery pursuant to any
judgment expressed in or converted into any currency other than dollars, except
to the extent that such tender or recovery results in the effective receipt by
the Administrative Agent or the respective Lender of the full amount of dollars
expressed to be payable to the Administrative Agent or such Lender under this
Agreement or the other Loan Documents. If, for the purpose of obtaining or
enforcing judgment against a Borrower in any court or in any jurisdiction, it
becomes necessary to convert into or from any currency other than dollars (such
other currency being hereinafter referred to as the "JUDGMENT CURRENCY") an
amount due in dollars, the conversion shall be made at the rate of exchange (as
quoted by the Administrative Agent or if the Administrative Agent does not quote
a rate of exchange on such currency, by a known dealer in such currency
designated by the Administrative Agent) determined, in each case, as of the
Business Day immediately preceding the day on which the
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judgment is given (such Business Day being hereinafter referred to as the
"JUDGMENT CURRENCY CONVERSION DATE").
(b) If there is a change in the rate of exchange prevailing
between the Judgment Currency Conversion Date and the date of actual payment of
the amount due, each Borrower covenants and agrees to pay, or cause to be paid,
such additional amounts, if any (but in any event not a lesser amount) as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of dollars which could have been purchased with the amount of
Judgment Currency stipulated in the judgment or judicial award at the rate of
exchange prevailing on the Judgment Currency Conversion Date.
(c) For purposes of determining any rate of exchange for this
SECTION 11.16, such amounts shall include any premium and costs payable in
connection with the purchase of dollars.
[Signature Pages Follow]
-125-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
PLY GEM INDUSTRIES, INC.
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: President and Chief
Executive Officer
CWD WINDOWS AND DOORS, INC.
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
PLY GEM HOLDINGS, INC.
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: President and Chief
Executive Officer
GREAT LAKES WINDOW, INC.
KROY BUILDING PRODUCTS, INC.
NAPCO, INC.
NAPCO WINDOW SYSTEMS, INC.
THERMAL-GARD, INC.
VARIFORM, INC.
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
S-1
UBS SECURITIES LLC, as a Joint Lead
Arranger
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
Title: Director
DEUTSCHE BANK SECURITIES INC.,
as a Joint Lead Arranger
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
CIBC WORLD MARKETS CORP.,
as a Co-Arranger
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Director
CIBC World Markets Corp.,
as Agent
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED, as a Co-Arranger
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Director
S-2
UBS AG, STAMFORD BRANCH, as Issuing
Bank, Administrative Agent and
Collateral Agent
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Associate Director
Banking Products Services US
By: /s/ ▇▇▇▇▇▇▇ ▇. Saint
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Saint
Title: Associate Director
Banking Products Services US
DEUTSCHE BANK AG CAYMAN ISLANDS
BRANCH, as Syndication Agent
By: /s/ ▇▇▇▇ ▇. ▇'▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
CANADIAN IMPERIAL BANK OF COMMERCE,
as Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Director
CIBC World Markets Corp.,
as Agent
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION,
as Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
UBS AG, LOAN FINANCE LLC, as Swingline
Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Associate Director
Banking Products Services US
By: /s/ ▇▇▇▇▇▇▇ ▇. Saint
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Saint
Title: Associate Director
Banking Products Services US
S-3
ANNEX I
Applicable Margin
REVOLVING LOANS
TOTAL ------------------------ APPLICABLE
LEVERAGE RATIO EURODOLLAR ABR FEE
------------------ ---------- ----------- ----------
Level I 2.50% 1.50% 0.50%
-------
>4.50:1.0
Level II 2.25% 1.25% 0.50%
--------
<4.50:1.0 but
>3.75:1.0
Level III 2.00% 1.00% 0.375%
---------
<3.75:1.0 but
>3.00:1.0
Level IV 1.75% 0.75% 0.375%
--------
<3.00:1.0
Each change in the Applicable Margin or Applicable Fee resulting from a
change in the Total Leverage Ratio shall be effective with respect to all Loans
and Letters of Credit outstanding on and after the date of delivery to the
Administrative Agent of the financial statements and certificates required by
SECTION 5.01(a) or (b) and SECTION 5.01(c), respectively, indicating such change
until the date immediately preceding the next date of delivery of such financial
statements and certificates indicating another such change. Notwithstanding the
foregoing, the Leverage Ratio shall be deemed to be in Level I (i) from the
Closing Date to the date of delivery to the Administrative Agent of the
financial statements and certificates required by SECTION 5.01(a) or (b) and
SECTION 5.01(c) for the fiscal period ended at least six months after the
Closing Date, (ii) at any time during which U.S. Borrower has failed to deliver
the financial statements and certificates required by SECTION 5.01(a) or (b) and
SECTION 5.01(c), respectively, and (iii) at any time during the existence of an
Event of Default.
ANNEX II
Amortization Table
-------------------------------------------------------------------------
U.S. TERM LOAN CANADIAN TERM LOAN
DATE AMOUNT AMOUNT
-------------------------------------------------------------------------
June 30, 2004 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2004 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2004 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2005 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2005 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2005 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2005 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2006 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2006 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2006 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2006 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2007 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2007 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2007 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2007 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2008 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2008 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2008 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2008 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2009 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2009 $400,000 $75,000
-------------------------------------------------------------------------
September 30, 2009 $400,000 $75,000
-------------------------------------------------------------------------
December 31, 2009 $400,000 $75,000
-------------------------------------------------------------------------
March 31, 2010 $400,000 $75,000
-------------------------------------------------------------------------
June 30, 2010 $37,600,000 $7,050,000
-------------------------------------------------------------------------
September 30, 2010 $37,600,000 $7,050,000
-------------------------------------------------------------------------
December 31, 2010 $37,600,000 $7,050,000
-------------------------------------------------------------------------
February 12, 2011 $37,600,000 $7,050,000
-------------------------------------------------------------------------
Total $160,000,000 $30,000,000
-------------------------------------------------------------------------
SCHEDULE 1.01(b)
----------------
CONSOLIDATED EBITDA ADDBACKS (IN $ MILLIONS)
Q1 Q2 Q3 Q4
2003 2003 2003 2003
-------------------------------------------------------------------------------------------------------
Elimination of Nortek's corporate charge 3,142 2,093 3,732 3,732*
Non-cash write-off of inventory 1,373 14 0 0
Thermal Gard Window and Other (Discontinued Operations) 178 34 77 284
PVC resin price renegotiation 1,035 816 0 0
Kroy-Lowes start up 1,720 203 0 0
Savings from the Butler, Pennsylvania facility closure 758 501 0 0
▇▇▇▇▇▇ facility closure one-time costs 478 129 149 85
One-time GLW management charges 188 237 163 65
Kroy balance sheet adjustments 291 313 467 1,029
TOTAL ADDBACKS 9,163 4,340 4,588 5,195
* To be finalized along with the 2003 audit.
SCHEDULE 5.13(c)
----------------
1. ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇
2. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇, ▇▇
3. ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇
4. ▇▇▇▇ ▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇