EXHIBIT 10.1
EXECUTION VERSION
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
dated as of October 7, 2005,
by and among
PERFORMANCE FOOD GROUP COMPANY,
as Borrower,
the Lenders referred to herein,
and
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent
and
BANK OF AMERICA, N.A.,
JPMORGAN CHASE BANK, N.A., and
SUNTRUST BANK,
as Syndication Agents
and
COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A., "RABOBANK
INTERNATIONAL", NEW YORK BRANCH,
as Documentation Agent
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.................................................................................................... 1
SECTION 1.1 Definitions................................................................................................ 1
SECTION 1.2 Other Definitions and Provisions........................................................................... 15
SECTION 1.3 Accounting Terms........................................................................................... 16
SECTION 1.4 UCC Terms.................................................................................................. 16
SECTION 1.5 Rounding................................................................................................... 16
SECTION 1.6 References to Agreement and Laws........................................................................... 16
SECTION 1.7 Times of Day............................................................................................... 17
SECTION 1.8 Letter of Credit Amounts................................................................................... 17
ARTICLE II REVOLVING CREDIT FACILITY..................................................................................... 17
SECTION 2.1 Revolving Credit Loans..................................................................................... 17
SECTION 2.2 Swingline Loans............................................................................................ 17
SECTION 2.3 Procedure for Advances of Revolving Credit and Swingline Loans............................................. 19
SECTION 2.4 Repayment of Loans......................................................................................... 20
SECTION 2.5 Voluntary Reduction of the Aggregate Commitment............................................................ 21
SECTION 2.6 Termination of Facility.................................................................................... 22
SECTION 2.7 Increase in the Aggregate Commitment....................................................................... 22
SECTION 2.8 Use of Proceeds............................................................................................ 22
ARTICLE III LETTER OF CREDIT FACILITY.................................................................................... 23
SECTION 3.1 L/C Commitment............................................................................................. 23
SECTION 3.2 Procedure for Issuance of Letters of Credit................................................................ 23
SECTION 3.3 Commissions and Other Charges.............................................................................. 23
SECTION 3.4 L/C Participations......................................................................................... 24
SECTION 3.5 Reimbursement Obligation of the Borrower................................................................... 25
SECTION 3.6 Obligations Absolute....................................................................................... 25
SECTION 3.7 Effect of Application...................................................................................... 26
SECTION 3.8 Letters of Credit Issued Pursuant to the Existing Credit Agreement......................................... 26
ARTICLE IV GENERAL LOAN PROVISIONS....................................................................................... 26
SECTION 4.1 Interest................................................................................................... 26
SECTION 4.2 Notice and Manner of Conversion or Continuation of Loans................................................... 29
SECTION 4.3 Fees....................................................................................................... 29
SECTION 4.4 Manner of Payment.......................................................................................... 30
SECTION 4.5 Crediting of Payments and Proceeds......................................................................... 31
SECTION 4.6 Evidence of Indebtedness................................................................................... 31
SECTION 4.7 Adjustments................................................................................................ 32
SECTION 4.8 Nature of Obligations of Lenders Regarding Extensions of Credit; Assumption
by the Administrative Agent................................................................................ 33
SECTION 4.9 Changed Circumstances...................................................................................... 33
SECTION 4.10 Indemnity.................................................................................................. 34
SECTION 4.11 Increased Costs............................................................................................ 34
SECTION 4.12 Taxes...................................................................................................... 36
SECTION 4.13 Mitigation of Obligations; Replacement of Lenders.......................................................... 38
ARTICLE V CLOSING; CONDITIONS OF CLOSING AND BORROWING................................................................... 39
SECTION 5.1 Closing.................................................................................................... 39
SECTION 5.2 Conditions to Closing and Initial Extensions of Credit..................................................... 39
SECTION 5.3 Conditions to All Extensions of Credit..................................................................... 42
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE BORROWER................................................................ 43
SECTION 6.1 Representations and Warranties............................................................................. 43
SECTION 6.2 Survival of Representations and Warranties, Etc............................................................ 49
ARTICLE VII FINANCIAL INFORMATION AND NOTICES............................................................................ 49
SECTION 7.1 Financial Statements and Projections....................................................................... 49
SECTION 7.2 Officer's Compliance Certificate........................................................................... 50
SECTION 7.3 Accountants' Certificate................................................................................... 50
SECTION 7.4 Other Reports.............................................................................................. 51
SECTION 7.5 Notice of Litigation and Other Matters..................................................................... 51
SECTION 7.6 Accuracy of Information.................................................................................... 51
ARTICLE VIII AFFIRMATIVE COVENANTS....................................................................................... 51
SECTION 8.1 Preservation of Corporate Existence and Related Matters.................................................... 52
SECTION 8.2 Maintenance of Property.................................................................................... 52
SECTION 8.3 Insurance.................................................................................................. 52
SECTION 8.4 Accounting Methods and Financial Records................................................................... 52
SECTION 8.5 Payment and Performance of Obligations..................................................................... 52
SECTION 8.6 Compliance With Laws and Approvals......................................................................... 53
SECTION 8.7 Environmental Laws......................................................................................... 53
SECTION 8.8 Compliance with ERISA...................................................................................... 53
SECTION 8.9 Conduct of Business........................................................................................ 53
SECTION 8.10 Visits and Inspections..................................................................................... 53
SECTION 8.11 Further Assurances......................................................................................... 54
ARTICLE IX FINANCIAL COVENANTS........................................................................................... 54
SECTION 9.1 Interest Coverage Ratio.................................................................................... 54
SECTION 9.2 Leverage Ratio............................................................................................. 54
ARTICLE X NEGATIVE COVENANTS............................................................................................. 54
SECTION 10.1 Limitations on Total Debt.................................................................................. 54
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SECTION 10.2 Limitations on Guaranty Obligations........................................................................ 55
SECTION 10.3 Limitations on Liens....................................................................................... 56
SECTION 10.4 Limitations on Loans, Advances, Investments and Acquisitions............................................... 56
SECTION 10.5 Limitations on Mergers and Liquidation..................................................................... 58
SECTION 10.6 Limitations on Sale of Assets.............................................................................. 59
SECTION 10.7 Limitations on Dividends and Distributions................................................................. 60
SECTION 10.8 Transactions with Affiliates............................................................................... 60
SECTION 10.9 Certain Accounting Changes................................................................................. 60
SECTION 10.10 Amendments; Payments and Prepayments of Subordinated Debt.................................................. 60
SECTION 10.11 Restrictive Agreements..................................................................................... 60
ARTICLE XI DEFAULT AND REMEDIES.......................................................................................... 61
SECTION 11.1 Events of Default.......................................................................................... 61
SECTION 11.2 Remedies................................................................................................... 63
SECTION 11.3 Rights and Remedies Cumulative; Non-Waiver; etc............................................................ 64
SECTION 11.4 Administrative Agent May File Proofs of Claim.............................................................. 64
ARTICLE XII THE ADMINISTRATIVE AGENT..................................................................................... 65
SECTION 12.1 Appointment and Authority.................................................................................. 65
SECTION 12.2 Rights as a Lender......................................................................................... 65
SECTION 12.3 Exculpatory Provisions..................................................................................... 65
SECTION 12.4 Reliance by the Administrative Agent....................................................................... 66
SECTION 12.5 Delegation of Duties....................................................................................... 67
SECTION 12.6 Resignation of Administrative Agent........................................................................ 67
SECTION 12.7 Non-Reliance on Administrative Agent and Other Lenders..................................................... 68
SECTION 12.8 No Other Duties, etc....................................................................................... 68
ARTICLE XIII MISCELLANEOUS............................................................................................... 68
SECTION 13.1 Notices.................................................................................................... 68
SECTION 13.2 Expenses; Indemnity........................................................................................ 69
SECTION 13.3 Right of Set-off........................................................................................... 71
SECTION 13.4 Governing Law.............................................................................................. 72
SECTION 13.5 Binding Arbitration; Waiver of Jury Trial.................................................................. 72
SECTION 13.6 Reversal of Payments....................................................................................... 73
SECTION 13.7 Injunctive Relief; Punitive Damages........................................................................ 74
SECTION 13.8 Accounting Matters......................................................................................... 74
SECTION 13.9 Successors and Assigns; Participations..................................................................... 74
SECTION 13.10 Confidentiality............................................................................................ 77
SECTION 13.11 Amendments, Waivers and Consents........................................................................... 78
SECTION 13.12 Performance of Duties...................................................................................... 79
SECTION 13.13 All Powers Coupled with Interest........................................................................... 79
SECTION 13.14 Survival of Indemnities.................................................................................... 79
SECTION 13.15 Titles and Captions........................................................................................ 79
SECTION 13.16 Severability of Provisions................................................................................. 79
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SECTION 13.17 Counterparts............................................................................................... 79
SECTION 13.18 Term of Agreement.......................................................................................... 79
SECTION 13.19 Independent Effect of Covenants............................................................................ 80
SECTION 13.20 Advice of Counsel.......................................................................................... 80
SECTION 13.21 No Strict Construction..................................................................................... 80
SECTION 13.22 Integration................................................................................................ 80
SECTION 13.23 USA Patriot Act............................................................................................ 80
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EXHIBITS AND SCHEDULES
EXHIBITS
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Swingline Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Notice of Account Designation
Exhibit D - Form of Notice of Prepayment
Exhibit E - Form of Notice of Conversion/Continuation
Exhibit F - Form of Officer's Compliance Certificate
Exhibit G - Form of Assignment and Assumption
Exhibit H - Form of Commitment Increase Supplement
Exhibit I - Form of New Lender Supplement
SCHEDULES
Schedule 6.1(a) - Jurisdictions of Organization and Qualification
Schedule 6.1(b) - Subsidiaries and Capitalization
Schedule 6.1(f) - Audits and Examinations
Schedule 6.1(i) - ERISA Plans
Schedule 6.1(m) - Material Adverse Effect
Schedule 6.1(p) - Debt and Guaranty Obligations
Schedule 6.1(q) - Litigation
Schedule 10.3 - Existing Liens
Schedule 10.4 - Existing Loans, Advances and Investments
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of the 7th
day of October, 2005, by and among PERFORMANCE FOOD GROUP COMPANY, a Tennessee
corporation (the "Borrower"), the Lenders who are or may become a party to this
Agreement, WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent for the
Lenders, Bank of America, N.A., JPMorgan Chase Bank, N.A. and SunTrust Bank, as
Syndication Agents, and Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A.,
"Rabobank International", New York Branch, as Documentation Agent.
STATEMENT OF PURPOSE
Pursuant to that certain Amended and Restated Credit Agreement dated as of
April 28, 2003 (as amended by the First Amendment dated as of September 15,
2004, the Amendment and Waiver dated as of April 26, 2005 and as further
amended, restated, supplemented or otherwise modified from time to time prior to
the date hereof, the "Existing Credit Agreement") by and among the Borrower, the
lenders party thereto (the "Existing Lenders"), and the agents listed therein,
the Existing Lenders extended certain credit facilities to the Borrower pursuant
to the terms thereof.
The Borrower has requested and, subject to the terms and conditions
hereof, the Administrative Agent and the Lenders have each agreed, to amend and
restate the Existing Credit Agreement in its entirety (the Existing Credit
Agreement as hereby amended and restated being this "Amended and Restated Credit
Agreement" or this "Agreement") as set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. The following terms when used in this Agreement
shall have the meanings assigned to them below:
"AAA" shall have the meaning assigned thereto in Section 13.5(a).
"Administrative Agent" means Wachovia in its capacity as Administrative
Agent hereunder, and any successor thereto appointed pursuant to Section 12.6.
"Administrative Agent's Office" means the office of the Administrative
Agent specified in or determined in accordance with the provisions of Section
13.1(c).
"Administrative Questionnaire" means an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, any other Person (other
than a Subsidiary) which directly or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
such first Person or any of its Subsidiaries. The term "control" means (a) the
power to vote fifteen percent (15%) or more of the securities or other equity
interests of a Person having ordinary voting power, or (b) the possession,
directly or indirectly, of any other power to direct or cause the direction of
the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.
"Aggregate Commitment" means (a) as to any Lender, the obligation of such
Lender to make Revolving Credit Loans to the account of the Borrower hereunder
in an aggregate principal amount at any time outstanding not to exceed the
amount set forth opposite such Lender's name on the Register as such amount may
be reduced or modified at any time or from time to time pursuant to the terms
hereof and (b) as to all Lenders, the aggregate commitment of all Lenders to
make Revolving Credit Loans, as such amount may be reduced at any time or from
time to time pursuant to the terms hereof. On the Closing Date, the Aggregate
Commitment shall be Four Hundred Million Dollars ($400,000,000).
"Agreement" means this Second Amended and Restated Credit Agreement, as
amended, restated, supplemented or otherwise modified from time to time.
"Applicable Law" means all applicable provisions of constitutions, laws,
statutes, ordinances, rules, treaties, regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities and
all applicable orders and decrees of all courts and arbitrators.
"Applicable Margin" shall have the meaning assigned thereto in Section
4.1(c).
"Application" means an application, in the form specified by the Issuing
Lender from time to time, requesting the Issuing Lender to issue a Letter of
Credit.
"Approved Fund" means any Person (other than a natural Person), including,
without limitation, any special purpose entity, that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of its business; provided,
that such Approved Fund must be administered, managed or underwritten by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arbitration Rules" shall have the meaning assigned thereto in Section
13.5(a).
"Assignment and Assumption" means an assignment and assumption entered
into by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 13.9), and accepted by the Administrative Agent,
in substantially the form of Exhibit G or any other form approved by the
Administrative Agent.
"Base Rate" means, at any time, the higher of (a) the Prime Rate and (b)
the sum of (i) the Federal Funds Rate plus (ii) 1/2 of 1%; each change in the
Base Rate shall take effect simultaneously with the corresponding change or
changes in the Prime Rate or the Federal Funds Rate.
"Base Rate Loan" means any Loan bearing interest at a rate based upon the
Base Rate as provided in Section 4.1(a).
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"Borrower" shall have the meaning assigned thereto in the preamble.
"Business Day" means (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in Charlotte, North Carolina and New York, New York, are open for
the conduct of their commercial banking business, and (b) with respect to all
notices and determinations in connection with, and payments of principal and
interest on, any LIBOR Rate Loan, any day that is a Business Day described in
clause (a) and that is also a day for trading by and between banks in Dollar
deposits in the London interbank market.
"Capital Asset" means, with respect to the Borrower and its Subsidiaries,
any asset that should, in accordance with GAAP, be classified and accounted for
as a capital asset on a Consolidated balance sheet of the Borrower and its
Subsidiaries.
"Capital Lease" means, with respect to the Borrower and its Subsidiaries,
any lease of any property that should, in accordance with GAAP, be classified
and accounted for as a capital lease on a Consolidated balance sheet of the
Borrower and its Subsidiaries.
"Capital Stock" means any nonredeemable capital stock of the Borrower or
any Subsidiary thereof, whether common or preferred.
"Change in Control" shall have the meaning assigned thereto in Section
11.1(h).
"Change in Law" means the occurrence, after the date of this Agreement, of
any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.
"Closing Date" means the date of this Agreement or such later Business Day
upon which each condition described in Section 5.2 shall be satisfied or waived
in all respects in a manner acceptable to the Administrative Agent, in its sole
discretion.
"Code" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended, supplemented or otherwise modified from
time to time.
"Commitment" means, as to any Lender, the obligation of such Lender to
make Revolving Credit Loans to and issue or participate in Letters of Credit
issued for the account of the Borrower hereunder in an aggregate principal or
face amount at any time outstanding not to exceed the amount set forth opposite
such Lender's name on the Register, as the same may be reduced, increased or
otherwise modified at any time or from time to time pursuant to the terms
hereof.
"Commitment Fee Rate" shall have the meaning assigned thereto in Section
4.3(a).
"Commitment Increase Supplement" shall have the meaning assigned thereto
in Section 2.7.
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"Commitment Percentage" means, as to any Lender at any time, the ratio of
(a) the amount of the Commitment of such Lender to (b) the Aggregate Commitment
of all of the Lenders.
"Consolidated" means, when used with reference to financial statements or
financial statement items of the Borrower and its Subsidiaries, such statements
or items on a consolidated basis in accordance with applicable principles of
consolidation under GAAP.
"Consolidated Assets" means, at any time, the total assets of Borrower and
its Subsidiaries determined on a Consolidated basis in accordance with GAAP.
"Debt" means, with respect to the Borrower and its Subsidiaries at any
date and without duplication, the sum of the following calculated on a
Consolidated basis in accordance with GAAP: (a) all liabilities, obligations and
indebtedness for borrowed money including but not limited to obligations
evidenced by bonds, debentures, notes or other similar instruments of the
Borrower or any Subsidiary thereof, (b) all obligations to pay the deferred
purchase price of property or services of the Borrower or any Subsidiary
thereof, including without limitation all obligations under non-competition
agreements but excluding (i) trade payables and Trade L/C's arising in the
ordinary course of business and (ii) all amounts payable under any earn-out
agreement unless any such earn-out payment is payable in cash and has been
deemed earned and required to be included on the financial statements of the
Borrower or any Subsidiary thereof in accordance with GAAP, (c) all obligations
of the Borrower or any Subsidiary thereof as lessee under Capital Leases, (d)
all Debt of any other Person secured by a Lien on any asset of the Borrower or
any Subsidiary thereof, (e) all Guaranty Obligations of the Borrower or any
Subsidiary thereof (excluding any Guaranty Obligations on account of trade
payables and Trade L/C's arising in the ordinary course of business), (f) all
obligations, contingent or otherwise, of the Borrower or any Subsidiary thereof
relative to the face amount of letters of credit, whether or not drawn,
including without limitation any Reimbursement Obligation, and banker's
acceptances issued for the account of the Borrower or any Subsidiary thereof
(excluding Trade L/C's arising in the ordinary course of business), (g) all
obligations of the Borrower or any Subsidiary thereof to redeem, repurchase,
exchange, defease or otherwise make payments in respect of capital stock or
other securities of the Borrower or any Subsidiary thereof, (h) all obligations
incurred by the Borrower or any Subsidiary thereof pursuant to Hedging
Agreements, and (i) although the parties acknowledge that asset securitization
facilities that comply with Section 10.6(e) may not constitute indebtedness of
the Borrower under GAAP, nevertheless, solely for purposes of determining
compliance with the terms of this Agreement, all asset securitization
facilities, including the Receivables Purchase Facility, shall be treated as
Debt.
"Default" means any of the events specified in Section 11.1 which with the
passage of time, the giving of notice or any other condition, would constitute
an Event of Default.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Revolving Credit Loans, participations in L/C Obligations or
participations in Swingline Loans required to be funded by it hereunder within
one Business Day of the date required to be funded by it hereunder, (b) has
otherwise failed to pay over to the Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date
4
when due, unless such amount is the subject of a good faith dispute, or (c) has
been deemed insolvent or become the subject of a bankruptcy or insolvency
proceeding.
"Disposition" means the sale, lease, transfer or other disposition of
property (including without limitation the transfer or issuance of shares or
equity interests in any Subsidiary) but shall not include any public taking or
condemnation, and "Dispose of" and "Disposed of" shall have a corresponding
meaning to Disposition. The term Disposition shall not include an exchange of
assets, provided that the assets involved in such exchange are similar in
function in that after giving effect to such exchange there has not been (A) a
Material Adverse Effect upon Borrower and its Subsidiaries taken as a whole, (B)
any material deterioration of cash flow generation from or in connection with
such assets, or (C) any material deterioration in the overall quality of plant,
property and equipment of Borrower and its Subsidiaries taken as a whole. An
"exchange" shall be deemed to have occurred if each of the transactions involved
shall have been consummated within a six-month period.
"Disputes" shall have the meaning assigned thereto in Section 13.5.
"Documentation Agent" shall mean Cooperatieve Centrale
Raiffeisen-Boerenleenbank B.A., "Rabobank International", New York Branch.
"Dollars" or "$" means, unless otherwise qualified, dollars in lawful
currency of the United States.
"EBITDA" means, for any period, the sum of the following determined on a
Consolidated basis, without duplication, for the Borrower and its Subsidiaries
in accordance with GAAP: (a) Net Income for such period plus (b) the sum of the
following to the extent deducted in determining Net Income: (i) income and
franchise taxes, (ii) the sum of (A) Interest Expense and (B) losses on the sale
of receivables in connection with the Receivables Purchase Facility, (iii)
amortization and depreciation, (iv) non-cash expenses related to the
transactions contemplated by this Agreement, (v) non-cash losses on sales of
assets, (vi) non-cash expenses in connection with the impairment of intangible
assets in accordance with SFAS 141 and SFAS 142, (vii) non-cash equity
compensation expenses and (viii) any and all write offs, write downs, and other
deductions of in-process research and development expenses in connection with
the transactions contemplated by this Agreement less (c) interest income and any
extraordinary gains which were included in determining Net Income. For purposes
of this Agreement, EBITDA shall be adjusted on a pro forma basis to include (1)
as of the first day of any applicable period, any Permitted Acquisition closed
during such period, including, without limitation, adjustments reflecting any
non-recurring costs and any extraordinary expenses of any Permitted Acquisition
closed during such period calculated on a basis consistent with GAAP and as
permitted pursuant to Regulation S-X of the SEC or as approved by the
Administrative Agent and (2) other adjustments to EBITDA reasonably acceptable
to the Administrative Agent.
"Eligible Assignee" means (a) a Lender, (b) an Affiliate of a Lender, (c)
an Approved Fund, and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, (ii) in the case of any assignment of
a Commitment, the Swingline Lender and the Issuing Lender, and (iii) unless a
Default or Event of Default has occurred and is continuing, the Borrower (each
such approval not to be unreasonably withheld or delayed); provided that
5
notwithstanding the foregoing, "Eligible Assignee" shall not include the
Borrower or any of the Borrower's Affiliates or Subsidiaries.
"Employee Benefit Plan" means any employee benefit plan within the meaning
of Section 3(3) of ERISA which (a) is maintained for employees of the Borrower
or any ERISA Affiliate or (b) has at any time within the preceding six (6) years
been maintained for the employees of the Borrower or any current or former ERISA
Affiliate.
"Environmental Claims" means any and all material written administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
accusations, allegations, notices of noncompliance or violation, investigations
(other than internal reports prepared by any Person in the ordinary course of
business and not in response to any third party action or request of any kind)
or proceedings relating in any way to any actual or alleged violation of or
liability under any Environmental Law or relating to any permit issued, or any
approval given, under any such Environmental Law, including, without limitation,
any and all material written claims by Governmental Authorities for enforcement,
cleanup, removal, response, remedial or other actions or damages, contribution,
indemnification cost recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of injury to human
health or the environment.
"Environmental Laws" means any and all federal, state and local laws,
statutes, ordinances, rules, regulations, permits, licenses, approvals,
interpretations and orders of courts or Governmental Authorities, relating to
the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, and the
rules and regulations thereunder, each as amended, supplemented or otherwise
modified from time to time.
"ERISA Affiliate" means any Person who together with the Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.
"ESOP" means the Borrower's Employee Stock Ownership Plan and Trust
established and existing under the Performance Food Group Company Employee
Savings and Stock Ownership Plan and Trust Agreements, effective as of August
11, 2004, by and between the Borrower and Wachovia Bank, National Association.
"Eurodollar Reserve Percentage" means, for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of eurocurrency liabilities or any similar category of liabilities for a
member bank of the Federal Reserve System in New York City.
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"Event of Default" means any of the events specified in Section 11.1,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.
"Existing Credit Agreement" shall have the meaning assigned thereto in the
Statement of Purpose.
"Existing Lenders" shall have the meaning assigned thereto in the
Statement of Purpose.
"Existing Loans" means the loans made by the Existing Lenders to the
Borrower pursuant to the Existing Credit Agreement.
"Extensions of Credit" means, as to any Lender at any time, an amount
equal to the sum of (a) the aggregate principal amount of all Revolving Credit
Loans made by such Lender then outstanding, (b) such Lender's Commitment
Percentage of the L/C Obligations then outstanding and (c) such Lender's
Commitment Percentage of the Swingline Loans then outstanding.
"FDIC" means the Federal Deposit Insurance Corporation, or any successor
thereto.
"Facility" means the revolving credit facility established pursuant to
Article II.
"Fair Market Value" shall mean, at any time, the sale value of property
that would be realized in an arm's length sale at such time between an informed
and willing buyer, and an informed and willing seller, under no compulsion to
buy or sell, respectively.
"Federal Funds Rate" means, the rate per annum (rounded upwards, if
necessary, to the next higher 1/100th of 1%) representing the daily effective
federal funds rate as quoted by the Administrative Agent and confirmed in
Federal Reserve Board Statistical Release H.15 (519) or any successor or
substitute publication selected by the Administrative Agent. If, for any reason,
such rate is not available, then "Federal Funds Rate" shall mean a daily rate
which is determined, in the opinion of the Administrative Agent, to be the rate
at which federal funds are being offered for sale in the national federal funds
market at 9:00 a.m. Rates for weekends or holidays shall be the same as the rate
for the most immediate preceding Business Day.
"Fiscal Year" means the 52 or 53 week fiscal year of the Borrower and its
Subsidiaries ending on the Saturday closest to December 31.
"GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board, consistently applied and maintained on a consistent
basis for the Borrower and its Subsidiaries throughout the period indicated and
consistent with the prior financial practice of the Borrower and its
Subsidiaries.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or
7
administrative functions of or pertaining to government, and any corporation or
other entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
"Guaranty Obligation" means, with respect to the Borrower and its
Subsidiaries, without duplication, any obligation, contingent or otherwise, of
any such Person pursuant to which such Person has directly or indirectly
guaranteed any Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of any such Person (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Guaranty
Obligation shall not include endorsements for collection or deposit in the
ordinary course of business.
"Hazardous Materials" means any substances or materials (a) which are or
become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Applicable Law, (b) which are toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human
health or the environment and are or become regulated by any Governmental
Authority, (c) the presence of which require investigation or remediation under
any Applicable Law, (d) the discharge or emission or release of which requires a
permit or license under any Applicable Law or other Governmental Approval, (e)
which are deemed, under Applicable Law, to constitute a nuisance, a trespass or
pose a health or safety hazard to persons or neighboring properties, (f) which
consist of underground or aboveground storage tanks, whether empty, filled or
partially filled with any hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Applicable Law, or (g) which contain, without limitation, asbestos,
polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum
hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel,
natural gas or synthetic gas.
"Hedging Agreement" means any agreement of the Borrower or any of its
Subsidiaries with respect to any Interest Rate Contract, forward rate agreement,
commodity swap, forward foreign exchange agreement, currency swap agreement,
cross-currency rate swap agreement, currency option agreement or other agreement
or arrangement designed to alter the risks of any Person arising from
fluctuations in interest rates, currency values or commodity prices, all as
amended, restated or otherwise modified; provided, however, that Hedging
Agreement shall not include fixed price fuel contracts entered into by the
Borrower or any Subsidiary.
"Intercompany Debt" shall have the meaning assigned thereto in Section
10.1(c).
"Interest Expense" means, for any period, total interest expense
(including, without limitation, interest expense attributable to Capital Leases
and losses on the sale of receivables in connection with the Receivables
Purchase Facility) determined on a Consolidated basis, without duplication, for
the Borrower and its Subsidiaries in accordance with GAAP.
8
"Interest Rate Contract" means any interest rate swap agreement, interest
rate cap agreement, interest rate floor agreement, interest rate collar
agreement, interest rate option or any other agreement regarding the hedging of
interest rate exposure executed in connection with hedging the interest rate
exposure of any Person and any confirming letter executed pursuant to such
agreement, all as amended, restated, supplemented or otherwise modified from
time to time.
"ISP98" means the International Standby Practices (1998 Revision,
effective January 1, 1999), International Chamber of Commerce Publication No.
590.
"Issuing Lender" means Wachovia, in its capacity as issuer of any Letter
of Credit, or any successor thereto.
"L/C Commitment" means the lesser of (a) One-Hundred Million Dollars
($100,000,000) and (b) the Aggregate Commitment.
"L/C Facility" means the letter of credit facility established pursuant to
Article III.
"L/C Obligations" means at any time, an amount equal to the sum of (a) the
aggregate undrawn and unexpired amount of the then outstanding Letters of Credit
and (b) the aggregate amount of drawings under Letters of Credit which have not
then been reimbursed pursuant to Section 3.5.
"L/C Participants" means the collective reference to all the Lenders other
than the Issuing Lender.
"Lender" means each Person executing this Agreement as a Lender
(including, without limitation, the Issuing Lender and the Swingline Lender
unless the context otherwise requires) set forth on the signature pages hereto
and each Person that hereafter becomes a party to this Agreement as (a) a New
Lender pursuant to Section 2.7 or (b) a Lender pursuant to Section 13.9.
"Lending Office" means, with respect to any Lender, the office of such
Lender maintaining such Lender's Extensions of Credit.
"Letters of Credit" means the collective reference to standby letters of
credit issued pursuant to Section 3.1.
"Leverage Ratio" shall have the meaning assigned thereto in Section 9.2.
"LIBOR" means the rate of interest per annum determined on the basis of
the rate for deposits in Dollars in minimum amounts of at least $5,000,000 for a
period equal to the applicable LIBOR Interest Period which appears on the
Telerate Page 3750 at approximately 11:00 a.m. (London time) two (2) Business
Days prior to the first day of the applicable LIBOR Interest Period (rounded
upward, if necessary, to the next higher 1/100th of 1%). If, for any reason,
such rate does not appear on the Telerate Page 3750, then "LIBOR" shall be
determined by the Administrative Agent to be the arithmetic average of the rate
per annum at which deposits in Dollars in minimum amounts of at least $5,000,000
would be offered by first class banks in the London interbank market to the
Administrative Agent approximately 11:00 a.m. (London time) two (2) Business
Days prior to the first day of the applicable LIBOR Interest Period for a
9
period equal to such LIBOR Interest Period and in an amount substantially equal
to the amount of the applicable Loan.
"LIBOR Interest Period" shall have the meaning assigned thereto in Section
4.1(b).
"LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to the
next higher 1/100th of 1%) determined by the Administrative Agent pursuant to
the following formula:
LIBOR
LIBOR Rate = --------------------------------------------------
1.00-Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Loan bearing interest at a rate based upon the
LIBOR Rate as provided in Section 4.1(a).
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, hypothecation or encumbrance of any kind in respect
of such asset. For the purposes of this Agreement, a Person shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement relating to such asset.
"Loan Documents" means, collectively, this Agreement, the Revolving Credit
Notes, the Swingline Notes, the Applications and each other document,
instrument, certificate and agreement executed and delivered by the Borrower,
its Subsidiaries or their counsel in connection with this Agreement or otherwise
referred to herein or contemplated hereby (excluding any Hedging Agreement), all
as may be amended, restated, supplemented or otherwise modified from time to
time.
"Loans" means the collective reference to the Revolving Credit Loans and
the Swingline Loans and "Loan" means any of such Loans.
"Material Adverse Effect" means, with respect to the Borrower or any of
its Subsidiaries, a material adverse effect on (a) the properties, business,
operations or financial condition of the Borrower and its Subsidiaries taken as
a whole or (b) the ability of any such Person to perform its obligations under
the Loan Documents to which it is a party.
"Maturity Date" means the earliest of the dates referred to in Section
2.6.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, or has accrued an obligation to make,
contributions within the preceding six (6) years.
"Net Cash Position" means on any day, with respect to the Operating
Account, a sum equal to (a) the opening available balance in the Operating
Account plus (b) any maturing investment principal and interest credited to the
Operating Account, minus (c) the sum of the following: (i) the daily presentment
of checks and Operating Account holds, (ii) any floor balance which has been
established to cover bank charges and (iii) any maturing interest debited to the
Operating Account, in each case for such day.
10
"Net Cash Proceeds" means with respect to any Disposition by the Borrower,
the gross cash proceeds received by the Borrower or any of its Subsidiaries from
such sale less the sum of (i) all income taxes and other taxes assessed by a
Governmental Authority as a result of such sale and any other fees and expenses
incurred in connection therewith and (ii) the principal amount of, premium, if
any, and interest on any Debt secured by a Lien on the asset (or a portion
thereof) sold, which Debt is required to be repaid in connection with such sale.
"Net Income" means, with respect to the Borrower and its Subsidiaries, for
any period, the Consolidated net income (or loss) thereof for such period
determined without duplication in accordance with GAAP.
"New Lender" shall have the meaning assigned thereto in Section 2.7.
"New Lender Supplement" shall have the meaning assigned thereto in Section
2.7.
"Net Worth" means, with respect to the Borrower and its Subsidiaries at
any date, total Stockholders' Equity determined on a Consolidated basis, without
duplication, in accordance with GAAP.
"Notes" means the collective reference to the Revolving Credit Notes and
the Swingline Notes and "Note" means any of such Notes.
"Notice of Account Designation" shall have the meaning assigned thereto in
Section 2.3(b).
"Notice of Borrowing" shall have the meaning assigned thereto in Section
2.3(a).
"Notice of Conversion/Continuation" shall have the meaning assigned
thereto in Section 4.2.
"Notice of Prepayment" shall have the meaning assigned thereto in Section
2.4(c).
"Obligations" means, in each case, whether now in existence or hereafter
arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans, (b) the L/C
Obligations, (c) all existing or future payment and other obligations owing by
the Borrower to any Lender or any Agent under any Hedging Agreement with any
Lender or any Agent, and (d) all other fees and commissions (including
attorney's fees), charges, indebtedness, loans, liabilities, financial
accommodations, obligations, covenants and duties owing by the Borrower or any
of its Subsidiaries to the Lenders or the Administrative Agent, of every kind,
nature and description, direct or indirect, absolute or contingent, due or to
become due, contractual or tortious, liquidated or unliquidated, and whether or
not evidenced by any note, in each case under or in respect of this Agreement,
any Note, any Letter of Credit or any of the other Loan Documents.
"OFAC" means the U.S. Department of the Treasury's Office of Foreign
Assets Control.
"Officer's Compliance Certificate" shall have the meaning assigned thereto
in Section 7.2.
11
"Operating Account" means the principal operating account of the Borrower
maintained with Wachovia.
"Other Taxes" shall have the meaning assigned thereto in Section 4.12(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"Pension Plan" means any Employee Benefit Plan, other than a Multiemployer
Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of
the Code and which (a) is maintained for employees of the Borrower or any ERISA
Affiliates or (b) has at any time within the preceding six (6) years been
maintained for the employees of the Borrower or any of its current or former
ERISA Affiliates.
"Performance Insurance" means Performance Insurance Company Limited, a
Bermuda corporation.
"Permitted Acquisition" shall have the meaning assigned thereto in Section
10.4(c).
"Person" means an individual, corporation, limited liability company,
partnership, association, trust, business trust, joint venture, joint stock
company, pool, syndicate, sole proprietorship, unincorporated organization,
Governmental Authority or any other form of entity or group thereof.
"Prime Rate" means, at any time, the rate of interest per annum publicly
announced from time to time by Wachovia as its prime rate. Each change in the
Prime Rate shall be effective as of the opening of business on the day such
change in such prime rate occurs. The parties hereto acknowledge that the rate
announced publicly by Wachovia as its prime rate is an index or base rate and
shall not necessarily be its lowest or best rate charged to its customers or
other banks.
"Receivables Purchase Facility" means a receivables purchase facility as
permitted hereunder.
"Register" shall have the meaning assigned thereto in Section 13.9(c).
"Reimbursement Obligation" means the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.
"Related Parties" means, with respect to any Person, such Person's
Affiliates and the directors, officers, employees and agents of such Person and
of such Person's Affiliates.
"Required Lenders" means, at any date, any combination of Lenders whose
Commitments aggregate at least fifty-one percent (51%) of the Aggregate
Commitment or, if the Commitments have been terminated pursuant to Section 11.2,
any combination of Lenders holding at least fifty-one percent (51%) of the
aggregate Extensions of Credit; provided that the Commitment of, and the portion
of the Extensions of Credit, as applicable, held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.
12
"Responsible Officer" means any of the following: the chief executive
officer or chief financial officer of the Borrower or any other officer of the
Borrower reasonably acceptable to the Administrative Agent (including the Vice
President - Finance and Treasurer).
"Revolving Credit Loans" means any revolving loan made to the Borrower
pursuant to Section 2.1, and all such revolving loans collectively as the
context requires.
"Revolving Credit Notes" means the collective reference to the Revolving
Credit Notes made by the Borrower payable to the order of each Lender,
substantially in the form of Exhibit A-1, evidencing the Facility, and any
amendments and modifications thereto, any substitutes therefor, and any
replacements, restatements, renewals or extension thereof, in whole or in part.
"Sanctioned Entity" shall mean (i) an agency of the government of, (ii) an
organization directly or indirectly controlled by, or (iii) a person resident in
a country that is subject to a sanctions program identified on the list
maintained by OFAC and available at
▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇/▇▇▇▇▇▇▇▇▇/▇▇▇▇▇.▇▇▇▇, or as
otherwise published from time to time as such program may be applicable to such
agency, organization or person.
"Sanctioned Person" shall mean a person named on the list of Specially
Designated Nationals or Blocked Persons maintained by OFAC available at
▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/ enforcement/ofac/sdn/index.html, or as otherwise
published from time to time.
"SEC" means the Securities and Exchange Commission of the United States.
"Senior Debt" means Total Debt less Subordinated Debt.
"Solvent" means, as to the Borrower and, on a combined basis, its
Subsidiaries on a particular date, that any such Person (a) has capital
sufficient to carry on its business and transactions and all business and
transactions in which it is about to engage and is able to pay its debts as they
mature, (b) owns property having a value, both at fair valuation and at present
fair saleable value, greater than the amount required to pay its probable
liabilities (including contingencies), and (c) does not believe that it will
incur debts or liabilities beyond its ability to pay such debts or liabilities
as they mature.
"Stockholders' Equity" means, as of any date of determination, the
shareholders' equity of the Borrower and its Subsidiaries, as set forth or
reflected on the most recent Consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with GAAP, (a) including but not limited to
(i) the par or stated value of all outstanding Capital Stock, (ii) capital
surplus, (iii) retained earnings and (b) excluding items such as (i) purchases
of treasury stock, (ii) valuation allowances, (iii) receivables due from an
employee stock ownership plan, (iv) employee stock ownership plan debt
guarantees (to the extent not included in item (b)(iii) hereof) and (v)
translation adjustments for foreign currency transactions.
"Subordinated Debt" means the collective reference to Debt of the Borrower
or any of its Subsidiaries which is subordinated in right and time of payment to
the Obligations and contains such other terms and conditions in each case as are
satisfactory to the Required Lenders.
13
"Subsidiary" means as to any Person, any corporation, partnership, limited
liability company or other entity of which more than fifty percent (50%) of the
outstanding capital stock or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other managers of such
corporation, partnership, limited liability company or other entity is at the
time, directly or indirectly, owned by or the management is otherwise controlled
by such Person (irrespective of whether, at the time, capital stock or other
ownership interests of any other class or classes of such corporation,
partnership, limited liability company or other entity shall have or might have
voting power by reason of the happening of any contingency); provided, however,
the term "Subsidiary" or "Subsidiaries" shall not, for any purpose, include
Performance Insurance so long as Performance Insurance remains a Bermuda
corporation engaged solely in the business of providing insurance and
insurance-related services to the Borrower and its Subsidiaries. Unless
otherwise qualified references to "Subsidiary" or "Subsidiaries" herein shall
refer to those of the Borrower.
"Subsidiary Disposition Proceeds" shall have the meaning assigned thereto
in Section 10.4.
"Sweep Plus Service Program" means the Sweep Plus Service Program of
Wachovia and any other cash management arrangement which the Borrower and
Wachovia agree should be included in the borrowing and repayment of Swingline
Loans pursuant to Section 2.2.
"Swingline Commitment" means the lesser of (a) Twenty-Five Million Dollars
($25,000,000) and (b) the Aggregate Commitment; provided, that upon the request
of the Borrower and with the consent of the Administrative Agent, the amount of
the Swingline Commitment referred to in clause (a) of this definition may be
increased to Thirty-Five Million Dollars ($35,000,000).
"Swingline Facility" means the swingline facility established pursuant to
Section 2.2.
"Swingline Lender" means Wachovia in its capacity as swingline lender
hereunder and any successor thereto appointed hereunder.
"Swingline Loan" means any swingline loan made by the Swingline Lender to
the Borrower pursuant to Section 2.2, and all such swingline loans collectively
as the context requires.
"Swingline Note" means the Swingline Note made by the Borrower payable to
the order of the Swingline Lender, substantially in the form of Exhibit A-2
hereto, evidencing the Swingline Loans, and any amendments and modifications
thereto, any substitutes therefor, and any replacements, restatements, renewals
or extensions thereof, in whole or in part.
"Swingline Termination Date" means the first to occur of (a) the
resignation of Wachovia as Administrative Agent in accordance with Section 12.6
and (b) the Maturity Date.
"Syndication Agents" shall mean the collective reference to Bank of
America, N.A., JPMorgan Chase Bank, N.A. and SunTrust Bank.
"Tax Credit" shall have the meaning assigned thereto in Section 4.12(g).
14
"Tax Payment" shall have the meaning assigned thereto in Section 4.12(g).
"Taxes" shall have the meaning assigned thereto in Section 4.12(a).
"Termination Event" means: (a) a "Reportable Event" described in Section
4043 of ERISA, or (b) the withdrawal of the Borrower or any ERISA Affiliate from
a Pension Plan during a plan year in which it was a "substantial employer" as
defined in Section 4001(a)(2) of ERISA, or (c) the termination of a Pension
Plan, the filing of a notice of intent to terminate a Pension Plan or the
treatment of a Pension Plan amendment as a termination under Section 4041 of
ERISA, or (d) the institution of proceedings to terminate, or the appointment of
a trustee with respect to, any Pension Plan by the PBGC, or (e) any other event
or condition which would constitute grounds under Section 4042(a) of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan, or (f) the partial or complete withdrawal of the Borrower or any ERISA
Affiliate from a Multiemployer Plan, or (g) the imposition of a Lien pursuant to
Section 412 of the Code or Section 302 of ERISA, or (h) any event or condition
which results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by PBGC of proceedings to terminate a Multiemployer Plan under
Section 4042 of ERISA.
"Total Debt" means, as of any date of determination with respect to the
Borrower and its Subsidiaries on a Consolidated basis without duplication, the
sum of all Debt of the Borrower and its Subsidiaries.
"Trade L/C's" means, collectively, the commercial letters of credit issued
and outstanding from time to time to support the obligations of the Borrower or
any of its Subsidiaries, contingent or otherwise, incurred in the ordinary
course of business of the Borrower or such Subsidiary.
"Uniform Customs" means the Uniform Customs and Practice for Documentary
Credits (1993 Revision, effective January 1, 1994), International Chamber of
Commerce Publication No. 500.
"UCC" means the Uniform Commercial Code as in effect in the State of North
Carolina, as amended, restated, supplemented or otherwise modified from time to
time.
"United States" means the United States of America.
"Wachovia" means Wachovia Bank, National Association, a national banking
association, and its successors.
"Wholly-Owned" means, with respect to a Subsidiary, that all of the shares
of capital stock or other ownership interests of such Subsidiary are, directly
or indirectly, owned or controlled by the Borrower and/or one or more of its
Wholly-Owned Subsidiaries.
SECTION 1.2 Other Definitions and Provisions. With reference to this
Agreement and each other Loan Document, unless otherwise specified herein or in
such other Loan Document, unless the context requires otherwise: (a) the
definitions of terms herein shall
15
apply equally to the singular and plural forms of the terms defined, (b)
whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms, (c) the words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation",
(d) the word "will" shall be construed to have the same meaning and effect as
the word "shall", (e) any definition of or reference to any 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), (f) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (g) 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, (h) 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, (i) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights, (j) the term
"documents" includes any and all instruments, documents, agreements,
certificates, notices, reports, financial statements and other writings, however
evidenced, whether in physical or electronic form, (k) in the computation of
periods of time from a specified date to a later specified date, the word "from"
means "from and including;" the words "to" and "until" each mean "to but
excluding;" and the word "through" means "to and including", and (l) Section
headings herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document.
SECTION 1.3 Accounting Terms. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the audited
financial statements required by Section 7.1(b), except as otherwise
specifically prescribed herein.
SECTION 1.4 UCC Terms. Terms defined in the UCC in effect on the Closing
Date and not otherwise defined herein shall, unless the context otherwise
indicates, have the meanings provided by those definitions. Subject to the
foregoing, the term "UCC" refers, as of any date of determination, to the UCC
then in effect.
SECTION 1.5 Rounding. Any financial ratios required to be maintained by
the Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
SECTION 1.6 References to Agreement and Laws. Unless otherwise expressly
provided herein, (a) references to formation documents, governing documents,
agreements (including the Loan Documents) and other contractual instruments
shall be deemed to include all subsequent amendments, restatements, extensions,
supplements and other
16
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Applicable Law shall include all
statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Applicable Law.
SECTION 1.7 Times of Day. Unless otherwise specified, all references
herein to times of day shall be references to Eastern time (daylight or
standard, as applicable).
SECTION 1.8 Letter of Credit Amounts. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the maximum face amount of such Letter of Credit after giving
effect to all increases thereof contemplated by such Letter of Credit or the
Application therefor, whether or not such maximum face amount is in effect at
such time.
ARTICLE II
REVOLVING CREDIT FACILITY
SECTION 2.1 Revolving Credit Loans.
(a) Revolving Credit Loans. Subject to the terms and conditions of this
Agreement, each Lender severally agrees to make Revolving Credit Loans to the
Borrower from time to time from the Closing Date through the Maturity Date as
requested by the Borrower in accordance with the terms of Section 2.3; provided,
that (a) the aggregate principal amount of all outstanding Revolving Credit
Loans (after giving effect to any amount requested) shall not exceed the
Aggregate Commitment less (i) the Swingline Commitment and (ii) the sum of all
outstanding L/C Obligations and (b) the principal amount of outstanding
Revolving Credit Loans from any Lender to the Borrower shall not at any time
exceed such Lender's Commitment less such Lender's Commitment Percentage of
outstanding L/C Obligations and the Swingline Commitment. Each Revolving Credit
Loan by a Lender shall be in a principal amount equal to such Lender's
Commitment Percentage of the aggregate principal amount of Revolving Credit
Loans requested on such occasion. Subject to the terms and conditions hereof,
the Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder
until the Maturity Date.
SECTION 2.2 Swingline Loans.
(a) Availability under this Agreement. Subject to the terms and conditions
of this Agreement, the Swingline Lender agrees to make Swingline Loans to the
Borrower from time to time from the Closing Date through, but not including, the
Swingline Termination Date; provided, that the aggregate principal amount of all
outstanding Swingline Loans (after giving effect to any amount requested), shall
not exceed the lesser of (i) the Aggregate Commitment less the sum of all
outstanding Revolving Credit Loans and the L/C Obligations and (ii) the
Swingline Commitment.
(b) Availability under the Sweep Plus Service Program. On each Business
Day, the Administrative Agent shall calculate the Net Cash Position. If the Net
Cash Position is less than zero, then the Borrower shall be deemed to have
irrevocably requested that the Swingline Lender make a Swingline Loan to the
Borrower in an amount equal to the lesser of (i) an amount, which
17
when rounded up to the nearest $1,000, equals or exceeds the amount of the
deficit Net Cash Position and (ii) an amount, which when added to the aggregate
principal amount of all outstanding Swingline Loans (after giving effect to any
amount deemed requested under this Section 2.2(b)), shall not exceed the lesser
of (A) the Aggregate Commitment less the sum of all outstanding Revolving Credit
Loans and the L/C Obligations and (B) the Swingline Commitment; provided,
however, that the obligation of the Swingline Lender to make any such Swingline
Loan to the Borrower shall be subject to all the terms and conditions hereof
(including, without limitation, Section 5.3 hereof).
(c) Payment of Principal and Interest. Principal and interest on Swingline
Loans deemed requested pursuant to Section 2.2(b) hereof shall be paid pursuant
to the terms and conditions of the Sweep Plus Service Program without any
deduction, setoff or counterclaim whatsoever. Principal and interest on
Swingline Loans requested pursuant to Section 2.3 hereof shall be paid pursuant
to the terms of this Agreement. Unless sooner paid pursuant to the provisions
hereof or the provisions of the Sweep Plus Service Program, the principal of the
Swingline Loans shall be paid in full, together with accrued interest thereon,
on the Swingline Termination Date.
(d) Refunding.
(i) Upon the occurrence and during the existence of an Event of
Default, Swingline Loans shall be refunded by the Lenders on demand by the
Swingline Lender. Such refundings shall be made by the Lenders in accordance
with their respective Commitment Percentages and shall thereafter be reflected
as Revolving Credit Loans of the Lenders on the books and records of the
Administrative Agent. Each Lender shall fund its respective Commitment
Percentage of Revolving Credit Loans as required to repay Swingline Loans
outstanding to the Swingline Lender upon demand by the Swingline Lender upon the
occurrence and during the existence of an Event of Default, but in no event
later than 2:00 p.m. on the next succeeding Business Day after such demand is
made. No Lender's obligation to fund its respective Commitment Percentage of a
Swingline Loan shall be affected by any other Lender's failure to fund its
Commitment Percentage of a Swingline Loan, nor shall any Lender's Commitment
Percentage be increased as a result of any such failure of any other Lender to
fund its Commitment Percentage of a Swingline Loan.
(ii) The Borrower shall pay to the Swingline Lender on demand the
amount of such Swingline Loans to the extent amounts received from the Lenders
are not sufficient to repay in full the outstanding Swingline Loans requested or
required to be refunded. In addition, the Borrower hereby authorizes the
Administrative Agent to charge any account maintained by the Borrower with the
Swingline Lender (up to the amount available therein) in order to immediately
pay the Swingline Lender the amount of such Swingline Loans to the extent
amounts received from the Lenders are not sufficient to repay in full the
outstanding Swingline Loans requested or required to be refunded. If any portion
of any such amount paid to the Swingline Lender shall be recovered by or on
behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise, the
loss of the amount so recovered shall be ratably shared among all the Lenders in
accordance with their respective Commitment Percentages (unless the amounts so
recovered by or on behalf of the Borrower pertain to a Swingline Loan extended
after the occurrence and during the continuance of an Event of Default of which
the Administrative Agent has received
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notice in the manner required pursuant to Section 12.5 and which such Event of
Default has not been waived by the Required Lenders or the Lenders, as
applicable).
(iii) Each Lender acknowledges and agrees that its obligation to
refund Swingline Loans in accordance with the terms of this Section 2.2 is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including, without limitation, non-satisfaction of the conditions
set forth in Article V. Further, each Lender agrees and acknowledges that if
prior to the refunding of any outstanding Swingline Loans pursuant to this
Section 2.2, one of the events described in Section 11.1(i) or (j) shall have
occurred, each Lender will, on the date the applicable Revolving Credit Loan
would have been made, purchase an undivided participating interest in the
Swingline Loan to be refunded in an amount equal to its Commitment Percentage of
the aggregate amount of such Swingline Loan. Each Lender will immediately
transfer to the Swingline Lender, in immediately available funds, the amount of
its participation and upon receipt thereof the Swingline Lender will deliver to
such Lender a certificate evidencing such participation dated the date of
receipt of such funds and for such amount. Whenever, at any time after the
Swingline Lender has received from any Lender such Lender's participating
interest in a Swingline Loan, the Swingline Lender receives any payment on
account thereof, the Swingline Lender will distribute to such Lender its
participating interest in such amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender's
participating interest was outstanding and funded).
SECTION 2.3 Procedure for Advances of Revolving Credit and Swingline
Loans.
(a) Requests for Borrowing. With the exception of Swingline Loans deemed
requested pursuant to Section 2.2(b) hereof, the Borrower shall give the
Administrative Agent irrevocable prior written notice in the form attached
hereto as Exhibit B (a "Notice of Borrowing") not later than 11:00 a.m. (i) on
the same Business Day as each Base Rate Loan and Swingline Loan requested under
this Section 2.3(a) and (ii) at least three (3) Business Days before each LIBOR
Rate Loan, of its intention to borrow, specifying (A) the date of such
borrowing, which shall be a Business Day, (B) the amount of such borrowing,
which shall be in an amount equal to the amount of the Aggregate Commitment then
available to the Borrower, or if less, (x) with respect to Base Rate Loans
(other than the Swingline Loans requested pursuant to this Section 2.3(a)) in an
aggregate principal amount of $3,000,000 or a whole multiple of $1,000,000 in
excess thereof, (y) with respect to LIBOR Rate Loans in an aggregate principal
amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (z)
with respect to the Swingline Loans requested pursuant to this Section 2.3(a) in
an aggregate principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof, (C) whether such Loan is to be a Revolving Credit Loan or a
Swingline Loan, (D) in the case of a Revolving Credit Loan whether the Loans are
to be LIBOR Rate Loans or Base Rate Loans, and (E) in the case of a LIBOR Rate
Loan, the duration of the LIBOR Interest Period applicable thereto. Any Notice
of Borrowing received after 11:00 a.m. shall be deemed received on the next
Business Day. The Administrative Agent shall promptly notify the Lenders of each
Notice of Borrowing.
(b) Disbursement of Revolving Credit Loans. Not later than 2:00 p.m. on
the proposed borrowing date, (i) each Lender will make available to the
Administrative Agent, for the account of the Borrower, at the Administrative
Agent's Office in funds immediately available to the Administrative Agent, such
Lender's Commitment Percentage of the Revolving Credit
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Loans to be made on such borrowing date and (ii) the Swingline Lender will make
available to the Administrative Agent, for the account of Borrower, at the
Administrative Agent's Office in funds immediately available to the
Administrative Agent, the Swingline Loans to be made on such Borrowing Date. The
Borrower hereby irrevocably authorizes the Administrative Agent to disburse the
proceeds of each borrowing requested pursuant to this Section 2.3 in immediately
available funds by crediting or wiring such proceeds to the deposit account of
the Borrower identified in the most recent notice substantially in the form of
Exhibit C (a "Notice of Account Designation") delivered by the Borrower to the
Administrative Agent or may be otherwise agreed upon by the Borrower and the
Administrative Agent from time to time. Subject to Section 4.8, the
Administrative Agent shall not be obligated to disburse the portion of the
proceeds of any Revolving Credit Loan requested pursuant to this Section 2.3 to
the extent that any Lender has not made available to the Administrative Agent
its Commitment Percentage of such Loan. Revolving Credit Loans to be made for
the purpose of refunding Swingline Loans shall be made by the Lenders as
provided in Section 2.2(d).
SECTION 2.4 Repayment of Loans.
(a) Repayment on Maturity Date. The Borrower shall repay the outstanding
principal amount of (i) all Revolving Credit Loans in full on the Maturity Date
and (ii) all Swingline Loans in accordance with Section 2.2, together, in each
case, with all accrued but unpaid interest thereon.
(b) Mandatory Repayment.
(i) Excess Loans. If at any time the outstanding principal amount of
all Revolving Credit Loans plus the sum of all outstanding Swingline Loans plus
all outstanding L/C Obligations exceeds the Aggregate Commitment, the Borrower
shall repay immediately upon notice from the Administrative Agent, by payment to
the Administrative Agent for the account of the Lenders, Extensions of Credit in
the manner set forth in clause (iii) below.
(ii) Dispositions. The Borrower shall prepay the Extensions of
Credit and/or cash collateralize the L/C Obligations in the manner set forth in
clause (iii) below in amounts equal to one hundred percent (100%) of the
aggregate Net Cash Proceeds from any Disposition by the Borrower or any of its
Subsidiaries outside of the ordinary course of the Borrower's or such
Subsidiary's business; provided that, so long as no Default or Event of Default
has occurred and is continuing, no prepayments shall be required from the Net
Cash Proceeds of any such Disposition if those proceeds are reinvested (or the
Borrower or any Subsidiary shall have entered into a binding agreement to
reinvest such proceeds) within one hundred and eighty (180) days after receipt
thereof in other assets to be used in the Borrower's business. For purposes of
the elimination of any doubt, the Disposition of any of the Borrower's lines of
business, assets of a particular line of business, or the ownership interests of
the Borrower with respect to a line of business shall be deemed to be
Dispositions outside of the ordinary course of the Borrower's business.
Prepayments required by this Section 2.4(b)(ii) shall be made within three (3)
Business Days after such prepayment becomes due and payable hereunder. Upon the
occurrence of any event triggering repayment under this Section 2.4(b)(ii), the
Borrower shall promptly deliver a Notice of Prepayment to the Administrative
Agent and upon receipt of such notice, the Administrative Agent shall promptly
so notify the Lenders.
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(iii) Manner of Payment. Each prepayment of the Loans under this
Section shall be applied as follows: first to the principal amount of
outstanding Swingline Loans, second to the principal amount of outstanding
Revolving Credit Loans, and third, with respect to any Letters of Credit then
outstanding, a payment of cash collateral into a cash collateral account opened
by the Administrative Agent, for the benefit of the Lenders in an amount equal
to the aggregate then undrawn and unexpired amount of such Letters of Credit.
Such cash collateral shall be applied in accordance with Section 11.2(b). Each
such repayment shall be accompanied by any amount required to be paid pursuant
to Section 4.10.
(c) Optional Repayments. The Borrower may at any time and from time to
time repay the Loans, in whole or in part, upon at least three (3) Business
Days' irrevocable notice to the Administrative Agent with respect to LIBOR Rate
Loans and one (1) Business Day irrevocable notice with respect to Base Rate
Loans and Swingline Loans, in the form attached hereto as Exhibit D (a "Notice
of Prepayment") specifying the date and amount of repayment and whether the
repayment is of LIBOR Rate Loans, Base Rate Loans and Swingline Loans or a
combination thereof, and, if of a combination thereof, the amount allocable to
each. Upon receipt of such notice, the Administrative Agent shall promptly
notify each Lender. If any such notice is given, the amount specified in such
notice shall be due and payable on the date set forth in such notice. Partial
repayments shall be in an aggregate amount of $1,000,000 or a whole multiple of
$250,000 in excess thereof with respect to Base Rate Loans (other than Swingline
Loans), $3,000,000 or a whole multiple of $1,000,000 in excess thereof with
respect to LIBOR Rate Loans and $500,000 or a whole multiple of $100,000 in
excess thereof with respect to Swingline Loans. Each such repayment shall be
accompanied by any amount required to be paid pursuant to Section 4.10.
(d) Limitation on Repayment of Certain Loans. The Borrower may not repay
any LIBOR Rate Loan on any day other than on the last day of the LIBOR Interest
Period applicable thereto unless such repayment is accompanied by any amount
required to be paid pursuant to Section 4.10.
SECTION 2.5 Voluntary Reduction of the Aggregate Commitment.
(a) The Borrower shall have the right at any time and from time to time,
upon at least five (5) Business Days prior written notice to the Administrative
Agent, to permanently reduce, without premium or penalty, (i) the Aggregate
Commitment at any time or (ii) portions of the Aggregate Commitment, from time
to time, in an aggregate principal amount not less than $3,000,000 or any whole
multiple of $1,000,000 in excess thereof. Any reduction of the Aggregate
Commitment shall be applied to the Commitment of each Lender according to its
Commitment Percentage.
(b) Each permanent reduction permitted pursuant to this Section 2.5 shall
be accompanied by a payment of principal sufficient to reduce the aggregate
outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as
applicable, after such reduction to the Aggregate Commitment as so reduced and
if the Aggregate Commitment as so reduced is less than the aggregate amount of
all outstanding Letters of Credit, the Borrower shall be required to deposit in
a cash collateral account opened by the Administrative Agent an amount equal to
the aggregate then undrawn and unexpired amount of such Letters of Credit. Any
reduction of the
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Aggregate Commitment to zero shall be accompanied by payment of all outstanding
Revolving Credit Loans and Swingline Loans (and furnishing of cash collateral
satisfactory to the Administrative Agent for all L/C Obligations) and shall
result in the termination of the Aggregate Commitment and the Facility. Such
cash collateral shall be applied in accordance with Section 11.2(b). If the
reduction of the Aggregate Commitment requires the repayment of any LIBOR Rate
Loan, such repayment shall be accompanied by any amount required to be paid
pursuant to Section 4.10.
SECTION 2.6 Termination of Facility. The Facility shall terminate on the
earliest of (a) October 7, 2010, (b) the date of termination by the Borrower
pursuant to Section 2.5(a), and (c) the date of termination by the
Administrative Agent on behalf of the Lenders pursuant to Section 11.2(a).
SECTION 2.7 Increase in the Aggregate Commitment. The Borrower shall have
the right, on ten (10) Business Days' prior written notice to the Administrative
Agent, so long as no Default or Event of Default shall have occurred and be
continuing or would result therefrom, at any time and from time to time prior to
the Maturity Date, to increase the total amount of the Aggregate Commitment
hereunder by (a) accepting the offer of any existing Lender or Lenders to
increase its (or their) Commitment (or Commitments) up to the amount of any such
increase and/or (b) accepting the offer or offers of any Person or Persons (not
then a Lender) with the consent of the Administrative Agent constituting an
Eligible Assignee to become a new Lender hereto (a "New Lender") with a
Commitment (or Commitments) up to the amount (or aggregate amount) of any such
increase; provided, that any such increase shall be offered first to the
Administrative Agent, then to the existing Lenders (on a pro rata basis) prior
to offering any such increase to a Person not a party to this Agreement;
provided, further, that (i) in no event shall any Lender's Commitment be
increased without the consent of such Lender, (ii) if any Revolving Credit Loans
are outstanding hereunder on the date that any such increase is to become
effective, the Administrative Agent and Lenders shall make such transfers of
funds as are necessary in order that the outstanding balance of such Revolving
Credit Loans reflect the Commitment Percentages of the Lenders after giving
effect to any increase pursuant to this Section 2.7, (iii) each such increase
shall be in minimum amounts of at least Five Million Dollars ($5,000,000), and
(iv) in no event shall any such increase result in the amount of the Aggregate
Commitment exceeding Six Hundred Million Dollars ($600,000,000). Any increase to
the Aggregate Commitment pursuant to clause (a) of the first sentence of this
Section 2.7 shall become effective upon the execution of a supplement in the
form of Exhibit H hereto (a "Commitment Increase Supplement"), executed by the
Borrower, the Administrative Agent and the increasing Lender or Lenders together
with a replacement Revolving Credit Note, if requested, and any increase to the
Aggregate Commitment pursuant to clause (b) of the first sentence of this
Section 2.7 shall become effective upon the execution of a supplement in the
form of Exhibit I hereto (a "New Lender Supplement") by the Borrower,
Administrative Agent and relevant New Lender or Lenders together with a
corresponding Revolving Credit Note, if requested. The Administrative Agent
shall forward copies of any such supplement to the Lenders promptly upon receipt
thereof.
SECTION 2.8 Use of Proceeds. The Borrower shall use the proceeds of the
Extensions of Credit (i) to refinance the indebtedness under the Existing Credit
Agreement, (ii) for working capital and general corporate requirements
(including Permitted Acquisitions) of the
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Borrower and its Subsidiaries, and (iii) to pay certain fees and expenses
incurred in connection with the foregoing.
ARTICLE III
LETTER OF CREDIT FACILITY
SECTION 3.1 L/C Commitment. Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Lenders set forth
in Section 3.4(a), agrees to issue standby letters of credit ("Letters of
Credit") for the account of the Borrower on any Business Day from the Closing
Date through but not including the Maturity Date in such form as may be approved
from time to time by the Issuing Lender; provided, that the Issuing Lender shall
have no obligation to issue any Letter of Credit if, after giving effect to such
issuance, (a) the L/C Obligations would exceed the L/C Commitment or (b) the
aggregate principal amount of outstanding Revolving Credit Loans, plus the
Swingline Commitment plus the aggregate amount of L/C Obligations would exceed
the Aggregate Commitment. Each Letter of Credit shall (i) be denominated in
Dollars in a minimum amount of $250,000, (ii) be a standby letter of credit
issued to support obligations of the Borrower or any of its Subsidiaries,
contingent or otherwise, incurred in the ordinary course of business, (iii)
expire on a date satisfactory to the Issuing Lender, which date shall be no
later than the earlier of (a) one (1) year after the date of issuance or (b) the
fifth (5th) business day prior to the Maturity Date and (iv) be subject to the
Uniform Customs and/or ISP98, as set forth in the Application or as determined
by the Issuing Lender, and, to the extent not inconsistent therewith, the laws
of the State of North Carolina. The Issuing Lender shall not at any time be
obligated to issue any Letter of Credit hereunder if such issuance would
conflict with, or cause the Issuing Lender or any L/C Participant to exceed any
limits imposed by, any Applicable Law. References herein to "issue" and
derivations thereof with respect to Letters of Credit shall also include
extensions or modifications of any existing Letters of Credit, unless the
context otherwise requires.
SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower may
from time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender at the Administrative Agent's Office an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
shall process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall, subject to Section 3.1 and Article V, promptly
issue the Letter of Credit requested thereby (but in no event shall the Issuing
Lender be required to issue any Letter of Credit earlier than three (3) Business
Days after its receipt of the Application therefor and all such other
certificates, documents and other papers and information relating thereto) by
issuing the original of such Letter of Credit to the beneficiary thereof or as
otherwise may be agreed by the Issuing Lender and the Borrower. The Issuing
Lender shall promptly furnish to the Borrower a copy of such Letter of Credit
and promptly notify each Lender of the issuance and, upon request by any Lender,
furnish to such Lender a copy of such Letter of Credit and the amount of such
Lender's participation therein.
SECTION 3.3 Commissions and Other Charges.
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(a) The Borrower shall pay to the Administrative Agent, for the account of
the Issuing Lender and the L/C Participants, a letter of credit commission with
respect to each Letter of Credit for such period as the Letter of Credit is
outstanding in an amount equal to the product of (i) the face amount of such
Letter of Credit times (ii) an annual percentage equal to the Applicable Margin
with respect to LIBOR Rate Loans in effect on the date of issuance of such
Letter of Credit. Such commission shall be payable quarterly in arrears on the
last Business Day of each calendar quarter and on the Maturity Date.
(b) In addition to the foregoing commission, the Borrower shall pay the
Administrative Agent, for the account of the Issuing Lender, an issuance fee of
0.125% per annum on the face amount of each Letter of Credit for such period as
the Letter of Credit is outstanding, payable quarterly in arrears on the last
Business Day of each calendar quarter and on the Maturity Date.
(c) The Borrower shall also pay all normal costs and expenses of the
Issuing Lender in connection with the issuance, transfer or other administration
of the Letters of Credit.
(d) The Administrative Agent shall, promptly following its receipt
thereof, distribute to the Issuing Lender and the L/C Participants all
commissions received by the Administrative Agent in accordance with their
respective Commitment Percentages.
SECTION 3.4 L/C Participations.
(a) The Issuing Lender irrevocably agrees to grant and hereby grants to
each L/C Participant, and, to induce the Issuing Lender to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase
and hereby accepts and purchases from the Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant's own account and risk
an undivided interest equal to such L/C Participant's Commitment Percentage in
the Issuing Lender's obligations and rights under and in respect of each Letter
of Credit issued hereunder and the amount of each draft paid by the Issuing
Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees
with the Issuing Lender that, if a draft is paid under any Letter of Credit for
which the Issuing Lender is not reimbursed in full by the Borrower in accordance
with the terms of this Agreement, such L/C Participant shall pay to the Issuing
Lender upon demand at the Issuing Lender's address for notices specified herein
an amount equal to such L/C Participant's Commitment Percentage of the amount of
such draft, or any part thereof, which is not so reimbursed.
(b) Upon becoming aware of any amount required to be paid by any L/C
Participant to the Issuing Lender pursuant to Section 3.4(a) in respect of any
unreimbursed portion of any payment made by the Issuing Lender under any Letter
of Credit, the Issuing Lender shall notify each L/C Participant of the amount
and due date of such required payment and such L/C Participant shall pay to the
Issuing Lender the amount specified on the applicable due date. If any such
amount is paid to the Issuing Lender after the date such payment is due, such
L/C Participant shall pay to the Issuing Lender on demand, in addition to such
amount, the product of (i) such amount, times (ii) the daily average Federal
Funds Rate as determined by the Administrative Agent during the period from and
including the date such payment is due to the date on which such payment is
immediately available to the Issuing Lender, times (iii) a fraction
24
the numerator of which is the number of days that elapse during such period and
the denominator of which is 360. A certificate of the Issuing Lender with
respect to any amounts owing under this Section 3.4(b) shall be conclusive in
the absence of manifest error. With respect to payment to the Issuing Lender of
the unreimbursed amounts described in this Section 3.4(b), if the L/C
Participants receive notice that any such payment is due (A) prior to 1:00 p.m.
on any Business Day, such payment shall be due that Business Day, and (B) after
1:00 p.m. on any Business Day, such payment shall be due on the following
Business Day.
(c) Whenever, at any time after the Issuing Lender has made payment under
any Letter of Credit and has received from any L/C Participant its Commitment
Percentage of such payment in accordance with this Section 3.4, the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise), or any payment of interest on account thereof,
the Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.
SECTION 3.5 Reimbursement Obligation of the Borrower. The Borrower agrees
to reimburse (either with the proceeds of a Revolving Credit Loan as provided
for in this Section or with funds from other sources) the Issuing Lender on each
date on which the Issuing Lender notifies the Borrower of the date and amount of
a draft paid under any Letter of Credit for the amount of (a) such draft so paid
and (b) any taxes, fees, charges or other costs or expenses incurred by the
Issuing Lender in connection with such payment. Each such payment shall be made
to the Issuing Lender at its address for notices specified herein in lawful
money of the United States and in immediately available funds. Interest shall be
payable on any and all amounts remaining unpaid by the Borrower under this
Article III from the date such amounts become payable (whether at stated
maturity, by acceleration or otherwise) until payment in full at the rate which
would be payable on any outstanding Base Rate Loans which were then overdue. If
the Borrower fails to timely reimburse the Issuing Lender on the date the
Borrower receives the notice referred to in this Section 3.5, the Borrower shall
be deemed to have timely given a Notice of Borrowing hereunder to the
Administrative Agent requesting the Lenders to make a Base Rate Loan on such
date in an amount equal to the amount of such drawing and, regardless of whether
or not the conditions precedent specified in Article V have been satisfied, the
Lenders shall make Base Rate Loans in such amount, the proceeds of which shall
be applied to reimburse the Issuing Lender for the amount of the related drawing
and costs and expenses. Each Lender acknowledges and agrees that its obligation
to fund a Loan in accordance with this Section 3.5 to reimburse the Issuing
Lender for any draft paid under a Letter of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever including, without
limitation, non-satisfaction of the conditions set forth in Section 2.3(a) or
Article V. If the Borrower has elected to pay the amount of such drawing with
funds from other sources and shall fail to reimburse the Issuing Lender as
provided above, the unreimbursed amount of such drawing shall bear interest at
the rate which would be payable on any outstanding Base Rate Loans which were
then overdue from the date such amounts become payable (whether at stated
maturity, by acceleration or otherwise) until payment in full.
SECTION 3.6 Obligations Absolute. The Borrower's obligations under this
Article III (including, without limitation, the Reimbursement Obligation) shall
be absolute and
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unconditional under any and all circumstances and irrespective of any set-off,
counterclaim or defense to payment which the Borrower may have or have had
against the Issuing Lender or any beneficiary of a Letter of Credit or any other
Person. The Borrower also agrees that the Issuing Lender and the L/C
Participants shall not be responsible for, and the Borrower's Reimbursement
Obligation under Section 3.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. The Issuing Lender shall not be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions caused by the Issuing Lender's gross
negligence or willful misconduct as determined by a court of competent
jurisdiction by final nonappealable judgment. The Borrower agrees that any
action taken or omitted by the Issuing Lender under or in connection with any
Letter of Credit or the related drafts or documents, if done in the absence of
gross negligence or willful misconduct and in accordance with the standards of
care specified in the Uniform Customs and, to the extent not inconsistent
therewith, the UCC shall be binding on the Borrower and shall not result in any
liability of the Issuing Lender or any L/C Participant to the Borrower. The
responsibility of the Issuing Lender to the Borrower in connection with any
draft presented for payment under any Letter of Credit shall, in addition to any
payment obligation expressly provided for in such Letter of Credit, be limited
to determining that the documents (including each draft) delivered under such
Letter of Credit in connection with such presentment are in conformity with such
Letter of Credit.
SECTION 3.7 Effect of Application. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Article III, the provisions of this Article III shall apply.
SECTION 3.8 Letters of Credit Issued Pursuant to the Existing Credit
Agreement. The Borrower, the Administrative Agent and each Lender agree that on
the Closing Date each letter of credit issued by Wachovia pursuant to the terms
of the Existing Credit Agreement shall, notwithstanding the provisions of
Section 3.2 to the contrary, be deemed to be a Letter of Credit issued under and
pursuant to and shall be subject to the terms of this Agreement as if originally
issued pursuant to the terms of this Agreement.
ARTICLE IV
GENERAL LOAN PROVISIONS
SECTION 4.1 Interest.
(a) Interest Rate Options. Subject to the provisions of this Section 4.1,
at the election of the Borrower, the aggregate principal balance of (i) any
Revolving Credit Loan shall bear interest at (A) the Base Rate plus the
Applicable Margin as set forth in Section 4.1(c) or (B) the LIBOR Rate plus the
Applicable Margin as set forth in Section 4.1(c) and (ii) any Swingline Loan
shall bear interest at the Base Rate plus the Applicable Margin as set forth in
Section 4.1(c)
26
or the rate mutually agreed upon by the Swingline Lender and the Borrower. The
Borrower shall select the rate of interest and LIBOR Interest Period, if any,
applicable to any Loan at the time a Notice of Borrowing is given pursuant to
Section 2.3 or at the time a Notice of Conversion/Continuation is given pursuant
to Section 4.2. Each Loan or portion thereof bearing interest based on the Base
Rate shall be a "Base Rate Loan", each Loan or portion thereof bearing interest
based on the LIBOR Rate shall be a "LIBOR Rate Loan." Any Loan or any portion
thereof as to which the Borrower has not duly specified an interest rate as
provided herein shall be deemed a Base Rate Loan.
(b) LIBOR Interest Periods.
(i) In connection with each LIBOR Rate Loan, the Borrower, by giving
notice at the times described in Section 2.3, shall elect an interest period
(each, a "LIBOR Interest Period") to be applicable to such Loan, which LIBOR
Interest Period shall be a period of one (1), two (2), three (3), or six (6)
months; provided that:
(A) each LIBOR Interest Period shall commence on the date of
advance of or conversion to any LIBOR Rate Loan and, in the case of
immediately successive LIBOR Interest Periods, each successive LIBOR
Interest Period shall commence on the date on which the next
preceding LIBOR Interest Period expires;
(B) if any LIBOR Interest Period would otherwise expire on a
day that is not a Business Day, such LIBOR Interest Period shall
expire on the next succeeding Business Day; provided, that if any
LIBOR Interest Period would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further
Business Day occurs in such month, such LIBOR Interest Period shall
expire on the next preceding Business Day;
(C) any LIBOR Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such LIBOR Interest Period) shall end on the last Business Day of
the relevant calendar month at the end of such LIBOR Interest
Period; and
(D) no LIBOR Interest Period shall extend beyond the Maturity
Date.
(ii) There shall be no more than eight (8) LIBOR Interest Periods in
effect at any time.
(c) Applicable Margin. The Applicable Margin provided for in Section
4.1(a) with respect to the Loans (the "Applicable Margin") shall (i) on the
Closing Date equal the percentages set forth in the certificate delivered
pursuant to Section 5.2(d) and (ii) for each fiscal quarter thereafter be
determined by reference to the Leverage Ratio as of the end of the fiscal
quarter immediately preceding the delivery of the applicable Officer's
Compliance Certificate as follows:
27
Applicable Margin Per Annum
---------------------------
Level Leverage Ratio Base Rate LIBOR Rate
----- -------------- --------- ----------
1 Greater than 3.50 to 1.00 0.00% 1.25%
2 Greater than 3.00 to 1.00 0.00% 1.125%
but less than or equal to 3.50 to 1.00
3 Greater than 2.25 to 1.00 0.00% 0.875%
but less than or equal to 3.00 to 1.00
4 Greater than 1.75 to 1.00 0.00% 0.625%
but less than or equal to 2.25 to 1.00
5 Less than or equal to 1.75 to 1.00 0.00% 0.500%
Adjustments, if any, in the Applicable Margin shall be made by the
Administrative Agent on the tenth (10th) Business Day after receipt by the
Administrative Agent of quarterly financial statements for the Borrower and its
Subsidiaries and the accompanying Officer's Compliance Certificate setting forth
the Leverage Ratio of the Borrower and its Subsidiaries as of the most recent
fiscal quarter end. Subject to Section 4.1(d), in the event the Borrower fails
to deliver such financial statements and certificate within the time required by
Section 7.2, the Applicable Margin shall be the highest Applicable Margin set
forth above until the delivery of such financial statements and certificate.
(d) Default Rate. Subject to Section 11.3, at the discretion of the
Administrative Agent and Required Lenders, upon the occurrence and during the
continuance of an Event of Default, (i) the Borrower shall no longer have the
option to request LIBOR Rate Loans or Swingline Loans, (ii) all outstanding
LIBOR Rate Loans shall bear interest at a rate per annum two percent (2%) in
excess of the rate then applicable to LIBOR Rate Loans, as applicable, until the
end of the applicable LIBOR Interest Period and thereafter at a rate equal to
two percent (2%) in excess of the rate then applicable to Base Rate Loans, and
(iii) all outstanding Base Rate Loans and other Obligations shall bear interest
at a rate per annum equal to two percent (2%) in excess of the rate then
applicable to Base Rate Loans or such other Obligations. Interest shall continue
to accrue on the Obligations after the filing by or against the Borrower of any
petition seeking any relief in bankruptcy or under any act or law pertaining to
insolvency or debtor relief, whether state, federal or foreign.
(e) Interest Payment and Computation. Interest on each Base Rate Loan
shall be payable in arrears on the last Business Day of each calendar quarter
commencing December 31, 2005; and interest on each LIBOR Rate Loan shall be
payable on the last day of each LIBOR Interest Period applicable thereto, and if
such LIBOR Interest Period extends over three (3) months, at the end of each
three (3) month interval during such LIBOR Interest Period. Interest on LIBOR
Rate Loans and all fees payable hereunder shall be computed on the basis of a
360-day year and assessed for the actual number of days elapsed and interest on
Base Rate Loans shall be computed on the basis of a 365/366-day year and
assessed for the actual number of days elapsed.
28
(f) Maximum Rate. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest under this Agreement charged or
collected pursuant to the terms of this Agreement exceed the highest rate
permissible under any Applicable Law which a court of competent jurisdiction
shall, in a final determination, deem applicable hereto. In the event that such
a court determines that the Lenders have charged or received interest hereunder
in excess of the highest applicable rate, the rate in effect hereunder shall
automatically be reduced to the maximum rate permitted by Applicable Law and the
Lenders shall at the Administrative Agent's option (i) promptly refund to the
Borrower any interest received by the Lenders in excess of the maximum lawful
rate or (ii) apply such excess to the principal balance of the Obligations on a
pro rata basis. It is the intent hereof that the Borrower not pay or contract to
pay, and that neither the Administrative Agent nor any Lender receive or
contract to receive, directly or indirectly in any manner whatsoever, interest
in excess of that which may be paid by the Borrower under Applicable Law.
SECTION 4.2 Notice and Manner of Conversion or Continuation of Loans.
Provided that no Event of Default has occurred and is then continuing, the
Borrower shall have the option to (a) convert at any time following the third
Business Day after the Closing Date all or any portion of its outstanding Base
Rate Loans (other than Swingline Loans) in a principal amount equal to
$3,000,000 or any whole multiple of $1,000,000 in excess thereof into one or
more LIBOR Rate Loans and (b) upon the expiration of any LIBOR Interest Period,
(i) convert all or any part of its outstanding LIBOR Rate Loans in a principal
amount equal to $3,000,000 or a whole multiple of $1,000,000 in excess thereof
into Base Rate Loans (other than Swingline Loans) or (ii) continue such LIBOR
Rate Loans as LIBOR Rate Loans. Whenever the Borrower desires to convert or
continue Loans as provided above, the Borrower shall give the Administrative
Agent irrevocable prior written notice in the form attached as Exhibit E (a
"Notice of Conversion/Continuation") not later than 11:00 a.m. three (3)
Business Days before the day on which a proposed conversion or continuation of
such Loan is to be effective specifying (A) the Loans to be converted or
continued, and, in the case of any LIBOR Rate Loan to be converted or continued,
the last day of the LIBOR Interest Period therefor, (B) the effective date of
such conversion or continuation (which shall be a Business Day), (C) the
principal amount of such Loans to be converted or continued, and (D) the LIBOR
Interest Period to be applicable to such converted or continued LIBOR Rate Loan.
The Administrative Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation.
SECTION 4.3 Fees.
(a) Commitment Fee. Commencing on the Closing Date, the Borrower shall pay
to the Administrative Agent, for the account of the Lenders, a non-refundable
commitment fee at a rate per annum determined by reference to the pricing grid
set forth below (the "Commitment Fee Rate") on the average daily unused portion
of the Aggregate Commitment; provided, that the amount of outstanding Swingline
Loans shall not be considered usage of the Aggregate Commitment for the purpose
of calculating such commitment fee. The commitment fee shall be payable in
arrears on the last Business Day of each calendar quarter during the term of
this Agreement commencing December 31, 2005, and on the Maturity Date. The
commitment fee shall be distributed by the Administrative Agent to the Lenders
pro rata in accordance with the Lenders' respective Commitment Percentages. The
Commitment Fee Rate shall (i) on the Closing Date equal the percentage set forth
in the certificate delivered pursuant to Section 5.2(d)
29
and (ii) for each fiscal quarter thereafter be determined by reference to the
Leverage Ratio as of the end of the fiscal quarter immediately preceding the
delivery of the applicable Officer's Compliance Certificate as follows:
Level Leverage Ratio Commitment Fee
----- -------------- --------------
1 Greater than 3.50 to 1.00 0.225%
2 Greater than 3.00 to 1.00 0.200%
but less than or equal to 3.50 to 1.00
3 Greater than 2.25 to 1.00 0.175%
but less than or equal to 3.00 to 1.00
4 Greater than 1.75 to 1.00 0.150%
but less than or equal to 2.25 to 1.00
5 Less than or equal to 1.75 to 1.00 0.125%
Adjustments, if any, in the Commitment Fee Rate shall be made by the
Administrative Agent on the tenth (10th) Business Day after receipt by the
Administrative Agent of quarterly financial statements for the Borrower and its
Subsidiaries and the accompanying Officer's Compliance Certificate setting forth
the Leverage Ratio of the Borrower and its Subsidiaries as of the most recent
fiscal quarter end. In the event the Borrower fails to deliver such financial
statements and certificate within the time required by Section 7.2, the
Commitment Fee Rate shall be the highest Commitment Fee Rate set forth above
until the delivery of such financial statements and certificate.
(b) Administrative Agent's Fees and Other Fees. In order to compensate the
Administrative Agent for performing its duties as Administrative Agent
hereunder, the Borrower agrees to pay to Administrative Agent, for its account,
the fee set forth in the separate letter agreement executed by the Borrower, the
Administrative Agent and Wachovia Capital Markets, LLC dated September 9, 2005.
SECTION 4.4 Manner of Payment. Each payment by the Borrower on account of
the principal of or interest on the Loans or of any fee, commission or other
amounts (subject to Article III, including the Reimbursement Obligation) payable
to the Lenders under this Agreement shall be made not later than 1:00 p.m. on
the date specified for payment under this Agreement to the Administrative Agent
at the Administrative Agent's Office for the account of the Lenders (other than
as set forth below) pro rata in accordance with their respective Commitment
Percentages (except as specified below), in Dollars, in immediately available
funds and shall be made without any set-off, counterclaim or deduction
whatsoever. Any payment received after such time but before 2:00 p.m. on such
day shall be deemed a payment on such date for the purposes of Section 11.1, but
for all other purposes shall be deemed to have been made on the next succeeding
Business Day. Any payment received after 2:00 p.m. shall be deemed to have been
made on the next succeeding Business Day for all purposes. Upon receipt by the
Administrative Agent of each such payment, the Administrative Agent shall
distribute to each Lender at its address for notices set forth herein its pro
rata share of such payment in accordance with such Lender's Commitment
Percentage (except as specified below) and shall
30
wire advice of the amount of such credit to each Lender. Each payment to the
Administrative Agent of the Issuing Lender's fees or L/C Participants'
commissions shall be made in like manner, but for the account of the Issuing
Lender or the L/C Participants, as the case may be. Each payment to the
Administrative Agent made in connection with a Swingline Loan shall be made in
like manner, but for the account of the Swingline Lender. Each payment to the
Administrative Agent of any Agent's fees or expenses shall be made for the
account of the applicable Agent and any amount payable to any Lender under
Sections 4.9, 4.10, 4.11, 4.12 or 13.2 shall be paid to the Administrative Agent
for the account of the applicable Lender. Subject to Section 4.1(b)(i)(B) if any
payment under this Agreement shall be specified to be made upon a day which is
not a Business Day, it shall be made on the next succeeding day which is a
Business Day and such extension of time shall in such case be included in
computing any interest if payable along with such payment.
SECTION 4.5 Crediting of Payments and Proceeds. In the event that the
Borrower shall fail to pay any of the Obligations when due and the Obligations
have been accelerated pursuant to Section 11.2, all payments received by the
Lenders upon the Obligations and all net proceeds from the enforcement of the
Obligations shall be applied:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts, including reasonable attorney fees,
payable to the Administrative Agent in its capacity as such and the Issuing
Lender in its capacity as such (ratably among the Administrative Agent and the
Issuing Lender in proportion to the respective amounts described in this clause
First payable to them);
Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders, including reasonable attorney fees (ratably among the Lenders in
proportion to the respective amounts described in this clause Second payable to
them);
Third, to payment of that portion of the Obligations constituting accrued
and unpaid interest on the Loans and Reimbursement Obligations and any
obligations under Hedging Agreements (including any termination payments and any
accrued and unpaid interest thereon) (ratably among the Lenders in proportion to
the respective amounts described in this clause Third payable to them);
Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and Reimbursement Obligations (ratably among the Lenders
in proportion to the respective amounts described in this clause Fourth held by
them);
Fifth, to the Administrative Agent for the account of the Issuing Lender,
to cash collateralize any L/C Obligations then outstanding; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by
Applicable Law.
SECTION 4.6 Evidence of Indebtedness.
31
(a) Extensions of Credit. The Extensions of Credit made by each Lender
shall be evidenced by one or more accounts or records maintained by such Lender
and by the Administrative Agent in the ordinary course of business. The accounts
or records maintained by the Administrative Agent and each Lender shall be
conclusive absent manifest error of the amount of the Extensions of Credit made
by the Lenders to the Borrower and the interest and payments thereon. Any
failure to so record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Borrower hereunder to pay any amount
owing with respect to the Obligations. In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agent in respect of such matters, the accounts and records of
the Administrative Agent shall control in the absence of manifest error. Upon
the request of any Lender made through the Administrative Agent, the Borrower
shall execute and deliver to such Lender (through the Administrative Agent) a
Revolving Credit Note and/or Swingline Note, as applicable, which shall evidence
such Lender's Revolving Credit Loans in addition to such accounts or records.
Each Lender may attach schedules to its Notes and endorse thereon the date,
amount and maturity of its Loans and payments with respect thereto.
(b) Participations. In addition to the accounts and records referred to in
subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit and Swingline
Loans. In the event of any conflict between the accounts and records maintained
by the Administrative Agent and the accounts and records of any Lender in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error.
SECTION 4.7 Adjustments. If any Lender shall, by exercising any right of
setoff or counterclaim or otherwise, obtain payment in respect of any principal
of or interest on any of its Loans or other obligations hereunder resulting in
such Lender's receiving payment of a proportion of the aggregate amount of its
Loans and accrued interest thereon or other such obligations (other than
pursuant to Sections 4.10, 4.11, 4.12 or 13.2 hereof) greater than its pro rata
share thereof as provided herein, then the Lender receiving such greater
proportion shall (a) notify the Administrative Agent of such fact, and (b)
purchase (for cash at face value) participations in the Loans and such other
obligations of the other Lenders, or make such other adjustments as shall be
equitable, 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 Loans and other amounts owing them;
provided that
(a) 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
(b) the provisions of this paragraph shall not be construed to apply to
(x) any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or (y) 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 Swingline Loans and Letters of Credit to any assignee
or participant, other than to the Borrower or any Subsidiary thereof (as to
which the provisions of this paragraph shall apply).
32
Each of the Borrower and its Subsidiaries 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 each of the Borrower and its Subsidiaries rights of setoff and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of such Person in the amount of such participation.
SECTION 4.8 Nature of Obligations of Lenders Regarding Extensions of
Credit; Assumption by the Administrative Agent. The obligations of the Lenders
under this Agreement to make the Loans and issue or participate in Letters of
Credit are several and are not joint or joint and several. Unless the
Administrative Agent shall have received notice from a Lender prior to a
proposed borrowing date that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of the amount to be borrowed
on such date (which notice shall not release such Lender of its obligations
hereunder), the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the proposed borrowing date in
accordance with Section 2.3(b), and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If such amount is made available to the Administrative
Agent on a date after such borrowing date, such Lender shall pay to the
Administrative Agent on demand an amount, until paid, equal to the product of
(a) the amount not made available by such Lender in accordance with the terms
hereof, times (b) the daily average Federal Funds Rate during such period as
determined by the Administrative Agent, times (c) a fraction the numerator of
which is the number of days that elapse from and including such borrowing date
to the date on which such amount not made available by such Lender in accordance
with the terms hereof shall have become immediately available to the
Administrative Agent and the denominator of which is 360. A certificate of the
Administrative Agent with respect to any amounts owing under this Section 4.8
shall be conclusive, absent manifest error. If such Lender's Commitment
Percentage of such borrowing is not made available to the Administrative Agent
by such Lender within three (3) Business Days after such borrowing date, the
Administrative Agent shall be entitled to recover such amount made available by
the Administrative Agent with interest thereon at the rate per annum applicable
to Base Rate Loans hereunder, on demand, from the Borrower. The failure of any
Lender to make available its Commitment Percentage of any Loan requested by the
Borrower shall not relieve it or any other Lender of its obligation, hereunder
to make its Commitment Percentage of such Loan available on the borrowing date,
but no Lender shall be responsible for the failure of any other Lender to make
its Commitment Percentage of such Loan available on the borrowing date.
Notwithstanding anything set forth herein to the contrary, any Lender that fails
to make available its Commitment Percentage shall not (i) have any voting or
consent rights under or with respect to any Loan Document or (ii) constitute a
"Lender" (or be included in the calculation of Required Lenders hereunder) for
any voting or consent rights under or with respect to any Loan Document.
SECTION 4.9 Changed Circumstances.
(a) Circumstances Affecting LIBOR Rate Availability. If with respect to
any LIBOR Interest Period the Administrative Agent or any Lender (after
consultation with Administrative Agent) shall determine that, by reason of
circumstances affecting the foreign exchange and interbank markets generally,
deposits in eurodollars, in the applicable amounts are not being quoted via the
Telerate Page 3750 or offered to the Administrative Agent or such Lender for
33
such LIBOR Interest Period, then the Administrative Agent shall forthwith give
notice thereof to the Borrower. Thereafter, until the Administrative Agent
notifies the Borrower that such circumstances no longer exist, the obligation of
the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert
any Loan to or continue any Loan as a LIBOR Rate Loan shall be suspended, and
the Borrower shall repay in full (or cause to be repaid in full) the then
outstanding principal amount of each such LIBOR Rate Loans together with accrued
interest thereon, on the last day of the then current LIBOR Interest Period
applicable to such LIBOR Rate Loan or convert the then outstanding principal
amount of each such LIBOR Rate Loan to a Base Rate Loan as of the last day of
such LIBOR Interest Period.
(b) Laws Affecting LIBOR Rate Availability. If, after the date hereof, the
introduction of, or any change in, any Applicable Law or any change in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or any of its Lending Offices) with any
request or directive (whether or not having the force of law) of any such
Governmental Authority, central bank or comparable agency, shall make it
unlawful or impossible for any of the Lenders (or any of its Lending Offices) to
honor its obligations hereunder to make or maintain any LIBOR Rate Loan, such
Lender shall promptly give notice thereof to the Administrative Agent and the
Administrative Agent shall promptly give notice to the Borrower and the other
Lenders. Thereafter, until the Administrative Agent notifies the Borrower that
such circumstances no longer exist, (i) the obligations of the Lenders to make
LIBOR Rate Loans and the right of the Borrower to convert any Loan or continue
any Loan as a LIBOR Rate Loan shall be suspended and thereafter the Borrower may
select only Base Rate Loans hereunder, and (ii) if any of the Lenders may not
lawfully continue to maintain a LIBOR Rate Loan to the end of the then current
LIBOR Interest Period applicable thereto as a LIBOR Rate Loan, the applicable
LIBOR Rate Loan shall immediately be converted to a Base Rate Loan for the
remainder of such LIBOR Interest Period.
SECTION 4.10 Indemnity. The Borrower hereby indemnifies each of the
Lenders against any loss or expense which may arise or be attributable to each
Lender's obtaining, liquidating or employing deposits or other funds acquired to
effect, fund or maintain any Loan (a) as a consequence of any failure by the
Borrower to make any payment when due of any amount due hereunder in connection
with a LIBOR Rate Loan, (b) due to any failure of the Borrower to borrow,
continue or convert on a date specified therefor in a Notice of Borrowing or
Notice of Conversion/Continuation or (c) due to any payment, prepayment or
conversion of any LIBOR Rate Loan on a date other than the last day of the LIBOR
Interest Period therefor. The amount of such loss or expense shall be
determined, in the applicable Lender's sole discretion, based upon the
assumption that such Lender funded its Commitment Percentage of the LIBOR Rate
Loans in the London interbank market and using any reasonable attribution or
averaging methods which such Lender deems appropriate and practical. A
certificate of such Lender setting forth the basis for determining such amount
or amounts necessary to compensate such Lender shall be forwarded to the
Borrower through the Administrative Agent and shall be conclusively presumed to
be correct save for manifest error.
SECTION 4.11 Increased Costs.
(a) Increased Costs Generally. If any Change in Law shall:
34
(i) impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or advances, loans or other credit extended
or participated in by, any Lender (except any reserve requirement reflected in
the LIBOR Rate) or the Issuing Lender;
(ii) subject any Lender or the Issuing Lender to any tax of any kind
whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any LIBOR Rate Loan made by it, or change
the basis of taxation of payments to such Lender or the Issuing Lender in
respect thereof (except for Other Taxes covered by Section 4.12 and the
imposition of, or any change in the rate of any excluded tax described in
Section 4.12(a) payable by such Lender or the Issuing Lender); or
(iii) impose on any Lender or the Issuing Lender or the London
interbank market any other condition, cost or expense affecting this Agreement
or LIBOR Rate 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, converting into or maintaining any LIBOR Rate Loan (or of
maintaining its obligation to make any such Loan), or to increase the cost to
such Lender or the Issuing Lender of participating in, issuing or maintaining
any Letter of Credit (or of maintaining its obligation to participate in or to
issue any Letter of Credit), or to reduce the amount of any sum received or
receivable by such Lender or the Issuing Lender hereunder (whether of principal,
interest or any other amount) then, upon written request of such Lender or the
Issuing Lender, the Borrower shall promptly pay, in accordance with Section
4.11(c), to any such Lender or the Issuing Lender, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing
Lender, as the case may be, for such additional costs incurred or reduction
suffered.
(b) Capital Requirements. If any Lender or the Issuing Lender determines
that any Change in Law affecting such Lender or the Issuing Lender or any
lending office of such Lender or such Lender's or the Issuing Lender's holding
company, if any, regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or the Issuing Lender's capital or
on the capital of such Lender's or the Issuing Lender's holding company, if any,
as a consequence of this Agreement, the Commitments of such Lender or the Loans
made by, or participations in Letters of Credit held by, such Lender, or the
Letters of Credit issued by the Issuing Lender, to a level below that which such
Lender or the Issuing Lender or such Lender's or the Issuing Lender's holding
company could have achieved but for such Change in Law (taking into
consideration such Lender's or the Issuing Lender's policies and the policies of
such Lender's or the Issuing Lender's holding company with respect to capital
adequacy), then from time to time upon written request of such Lender or such
Issuing Lender the Borrower shall promptly pay, in accordance with Section
4.11(c), to such Lender or the Issuing Lender, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing
Lender or such Lender's or the Issuing Lender's holding company for any such
reduction suffered.
(c) Certificates for Reimbursement. A certificate of a Lender or the
Issuing Lender setting forth the amount or amounts necessary to compensate such
Lender or the Issuing Lender or its holding company, as the case may be, as
specified in paragraph (a) or (b) of this Section and delivered to the Borrower
shall be conclusive absent manifest error. The Borrower shall pay
35
such Lender or the Issuing Lender, as the case may be, the amount shown as due
on any such certificate within ten (10) days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or the
Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or the Issuing Lender's right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender or the Issuing Lender pursuant to this Section for any
increased costs incurred or reductions suffered more than six (6) months prior
to the date that such Lender or the Issuing Lender, as the case may be, notifies
the Borrower of the Change in Law giving rise to such increased costs or
reductions and of such Lender's or the Issuing Lender's intention to claim
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the six-month period referred
to above shall be extended to include the period of retroactive effect thereof).
SECTION 4.12 Taxes.
(a) Payments Free and Clear. Any and all payments by the Borrower
hereunder or under any other Loan Document shall be made free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholding, and all liabilities with respect thereto
excluding, (i) in the case of each Lender and the Administrative Agent, income
and franchise taxes imposed by the jurisdiction under the laws of which such
Lender or the Administrative Agent (as the case may be) is organized or is or
should be qualified to do business or any political subdivision thereof and (ii)
in the case of each Lender, income and franchise taxes imposed by the
jurisdiction of such Lender's Lending Office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct or withhold any Taxes from or in
respect of any sum payable hereunder or under any other Loan Document to any
Lender or the Administrative Agent, (A) the sum payable shall be increased as
may be necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional sums payable
under this Section 4.12) such Lender or the Administrative Agent (as the case
may be) receives an amount equal to the amount such party would have received
had no such deductions or withholdings been made, (B) the Borrower shall make
such deductions or withholdings, (C) the Borrower shall pay the full amount
deducted to the relevant taxing authority or other authority in accordance with
Applicable Law, and (D) the Borrower shall deliver to the Administrative Agent
evidence of such payment to the relevant taxing authority or other Governmental
Authority in the manner provided in Section 4.12(d).
(b) Stamp and Other Taxes. In addition, the Borrower shall pay any present
or future stamp, registration, recordation or documentary taxes or any other
similar fees or charges or excise or property taxes, levies of the United States
or any state or political subdivision thereof or any applicable foreign
jurisdiction which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Loans, the Letters of Credit or the other Loan Documents, or the perfection of
any rights or security interest in respect thereof (hereinafter referred to as
"Other Taxes").
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(c) Indemnity. The Borrower shall indemnify each Lender and the
Administrative Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes and Other Taxes imposed by any jurisdiction on
amounts payable under this Section 4.12) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Such indemnification shall be made within thirty (30) days from the date such
Lender or the Administrative Agent (as the case may be) makes written demand
therefor.
(d) Evidence of Payment. Within thirty (30) days after the date of any
payment of Taxes or Other Taxes, the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 13.1, the original
or a certified copy of a receipt evidencing payment thereof or other evidence of
payment satisfactory to the Administrative Agent.
(e) Delivery of Tax Forms. Each Lender organized under the laws of a
jurisdiction other than the United States or any state thereof shall deliver to
the Borrower, with a copy to the Administrative Agent, on the Closing Date or
concurrently with the delivery of the relevant Assignment and Acceptance, as
applicable, (i) two United States Internal Revenue Service Forms W-8ECI or Forms
W-8BEN, as applicable (or successor forms) properly completed and certifying in
each case that such Lender is entitled to a complete exemption from withholding
or deduction for or on account of any United States federal income taxes, and
(ii) an Internal Revenue Service Form W-8BEN or W-8ECI or successor applicable
form, as the case may be, to establish an exemption from United States backup
withholding taxes. Each such Lender further agrees to deliver to the Borrower,
with a copy to the Administrative Agent, a Form W-8BEN or W-8ECI, or successor
applicable forms or manner of certification, as the case may be, on or before
the date that any such form expires or becomes obsolete or after the occurrence
of any event requiring a change in the most recent form previously delivered by
it to the Borrower, certifying in the case of a Form W-8BEN or W-8ECI that such
Lender is entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes (unless in any such case
an event (including without limitation any change in treaty, law or regulation)
has occurred prior to the date on which any such delivery would otherwise be
required which renders such forms inapplicable or the exemption to which such
forms relate unavailable and such Lender notifies the Borrower and the
Administrative Agent that it is not entitled to receive payments without
deduction or withholding of United States federal income taxes) and, in the case
of a Form W-8BEN or W-8ECI, establishing an exemption from United States backup
withholding tax.
(f) Survival. Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower contained
in this Section 4.12 shall survive the payment in full of the Obligations and
the termination of the Commitments.
(g) Tax Credits. Each Lender represents and warrants that each such form
supplied by it to the Administrative Agent and, as the case may be, the Borrower
pursuant to this Section 4.12, and not superseded by another form supplied by
it, is or will be, as the case may be, complete and accurate. Each Lender
further agrees that the Borrower shall not be required to indemnify such Lender
or pay any additional amounts to such Lender in respect of any United
37
States Federal withholding tax existing on the date such Lender became a Lender
hereunder, or with respect to payments to or for the account of a new lending
office for such Lender, existing on the date such Lender designated such new
lending office with respect to such payments or the related Loans.
If the Borrower pays any additional amount under this Section 4.12 (a "Tax
Payment") and any Lender or Affiliate thereof effectively obtains a refund or
credit against tax by reason of the Tax Payment (a "Tax Credit") and such Lender
of such Affiliate identifies the Tax Credit as being attributable to the Tax
Payment, then such Lender, after actual receipt of such Tax Credit or actual
receipt of the benefits thereof, shall promptly reimburse the Borrower for such
amount as such Lender shall reasonably determine to be the proportion of the Tax
Credit as will leave such Lender (after such reimbursement) in no better or
worse position than it would have been if the Tax Payment had not been required
and such Lender agrees to reasonably cooperate with the Borrower if the Borrower
elects to pursue a refund; provided, however, that no Lender shall be required
to make any such reimbursement or cooperate with the Borrower if it reasonably,
as determined in such Lender's sole discretion, believes that the making of such
reimbursement or cooperating with the Borrower would cause it to lose the
benefit of the Tax Credit or would adversely affect in any other respect its tax
position. Subject to the terms hereof, any claim by a Lender for a Tax Credit
shall be made in a manner, order and amount as such Lender determines in its
sole discretion. Except to the extent necessary for the Borrower to evaluate any
Tax Credit, no Lender shall be obligated to disclose information regarding its
tax affairs or computations to the Borrower, it being understood and agreed that
in no event shall any Lender be required to disclose information regarding its
tax position that it deems to be confidential (other than with respect to the
Tax Credit).
SECTION 4.13 Mitigation of Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 4.11, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 4.12, 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 judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 4.11 or Section 4.12, 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 Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment, which costs and expenses shall not exceed those
costs that would have been incurred pursuant to Section 4.11 or Section 4.12.
(b) Replacement of Lenders. If any Lender requests compensation under
Section 4.11 or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 4.12, or if any Lender defaults in its obligation to fund Loans
hereunder, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 13.9 except for Section 13.9(b)(iv)), all of its interests,
rights and obligations under this
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Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided that
(i) the Borrower shall have paid to the Administrative Agent the
assignment fee specified in Section 13.9,
(ii) such Lender shall have received payment of an amount equal to
the outstanding principal of its Loans and participations in Letters of Credit,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder and under the other Loan Documents (including any amounts under
Section 4.10) from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts),
(iii) in the case of any such assignment resulting from a claim for
compensation under Section 4.11 or payments required to be made pursuant to
Section 4.12, such assignment will result in a reduction in such compensation or
payments thereafter, and
(iv) such assignment does not conflict with Applicable Law.
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 such Borrower to require such assignment and delegation
cease to apply.
ARTICLE V
CLOSING; CONDITIONS OF CLOSING AND BORROWING
SECTION 5.1 Closing. The closing shall take place at the offices of
Kennedy, Covington, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.P. at 10:00 a.m. on October 7, 2005,
or on such other date and time as the parties hereto shall mutually agree.
SECTION 5.2 Conditions to Closing and Initial Extensions of Credit. The
obligation of the Lenders to close this Agreement and to make the initial Loan
or issue or participate in the initial Letter of Credit is subject to the
satisfaction of each of the following conditions:
(a) Executed Loan Documents. This Agreement, a Revolving Credit Note in
favor of each Lender requesting a Revolving Credit Note, a Swingline Note in
favor of each Lender requesting a Swingline Note and the other Loan Documents
shall have been duly authorized, executed and delivered to the Administrative
Agent by the parties thereto, shall be in full force and effect and no Default
or Event of Default shall exist hereunder or thereunder, and the Borrower shall
have delivered original counterparts thereof to the Administrative Agent.
(b) Closing Certificates; etc.
(i) Officer's Certificate of the Borrower. The Administrative Agent
shall have received a certificate from a Responsible Officer, in form and
substance satisfactory to the Administrative Agent, to the effect that all
representations and warranties of the Borrower and its
39
Subsidiaries contained in this Agreement and the other Loan Documents are true,
correct and complete; that neither the Borrower nor any of its Subsidiaries is
in violation of any of the covenants contained in this Agreement and the other
Loan Documents; that, after giving effect to the transactions contemplated by
this Agreement, no Default or Event of Default has occurred and is continuing;
and that the Borrower has satisfied each of the closing conditions.
(ii) Certificate of Secretary of the Borrower. The Administrative
Agent shall have received a certificate of the secretary or assistant secretary
of the Borrower certifying as to the incumbency and genuineness of the signature
of each officer of the Borrower executing Loan Documents to which it is a party
and certifying that attached thereto is a true, correct and complete copy of (A)
the charter of the Borrower and all amendments thereto, certified as of a recent
date by the appropriate Governmental Authority in its jurisdiction of
incorporation, (B) the bylaws of the Borrower as in effect on the date of such
certifications, (C) resolutions duly adopted by the Board of Directors of the
Borrower authorizing the transactions contemplated hereunder and the execution,
delivery and performance of this Agreement and the other Loan Documents to which
it is a party, and (D) each certificate required to be delivered pursuant to
Section 5.2(b)(iii).
(iii) Certificates of Good Standing. The Administrative Agent shall
have received certificates as of a recent date of the good standing of the
Borrower under the laws of its jurisdiction of organization and, to the extent
requested by the Administrative Agent, each other jurisdiction where each such
Person is qualified to do business and, if separately available, a certificate
of the relevant taxing authorities of such jurisdictions certifying that each
such Person has filed required tax returns and owes no delinquent taxes.
(iv) Opinions of Counsel. The Administrative Agent shall have
received favorable opinions of counsel to the Borrower addressed to the
Administrative Agent and the Lenders with respect to the Borrower, the Loan
Documents and such other matters as the Lenders shall request.
(v) Tax Forms. The Administrative Agent shall have received copies
of the United States Internal Revenue Service forms required by Section 4.12(e).
(c) Consents; Defaults.
(i) Governmental and Third Party Approvals. The Borrower shall have
obtained all necessary approvals, authorizations and consents of any Person and
of all Governmental Authorities and courts having jurisdiction with respect to
the transactions contemplated by this Agreement and the other Loan Documents and
the other transactions contemplated hereby and all applicable waiting periods
shall have expired without any action being taken by any Person that could
reasonably be expected to restrain, prevent or impose any material adverse
conditions on any of the Borrower or its Subsidiaries or such other transactions
or that could seek or threaten any of the foregoing, and no law or regulation
shall be applicable which in the reasonable judgment of the Administrative Agent
could reasonably be expected to have such effect.
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(ii) No Injunction, Etc. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain
substantial damages in respect of, or which is related to or arises out of this
Agreement or the other Loan Documents or the consummation of the transactions
contemplated hereby or thereby, or which, in the sole discretion of the
Administrative Agent, would make it inadvisable to consummate the transactions
contemplated by this Agreement and such other Loan Documents.
(iii) No Event of Default. No Default or Event of Default (as each
such term is defined in the Existing Credit Agreement) shall have occurred and
be continuing.
(d) Financial Matters.
(i) Financial Statements. The Administrative Agent shall have
received the audited consolidated financial statements for the twelve (12) month
period ended January 1, 2005 of the Borrower and its Subsidiaries and
internally-prepared unaudited financial statements of the Borrower and its
Subsidiaries for the fiscal quarter ended July 2, 2005, all in form and
substance satisfactory to the Administrative Agent and prepared in accordance
with GAAP.
(ii) Financial Condition Certificate. The Borrower shall have
delivered to the Administrative Agent a certificate, in form and substance
satisfactory to the Administrative Agent, and certified as accurate by a
Responsible Officer, that (A) the Borrower and, on a combined basis, its
Subsidiaries are Solvent, (B) the Borrower's payables are current and not past
due, except in the ordinary course of business, (C) attached thereto is a pro
forma balance sheet of the Borrower and its Subsidiaries setting forth on a pro
forma basis the financial condition of the Borrower and its Subsidiaries on a
Consolidated basis as of that date, reflecting on a pro forma basis the effect
of all acquisitions consummated by the Borrower or its Subsidiaries within the
twelve (12) month period ended July 2, 2005, and the transactions contemplated
herein, including all fees and expenses in connection therewith, and evidencing
compliance on a pro forma basis with the covenants contained in Articles IX and
X, (D) the five (5) year financial projections (which projections make certain
assumptions regarding generic acquisitions by the Borrower or its Subsidiaries)
previously delivered to the Administrative Agent represent the good faith
opinions of the Borrower and senior management thereof as to the projected
results contained therein and (E) any updates or modifications to the financial
statements previously delivered.
(iii) Payment at Closing. The Borrower shall have paid all accrued
but unpaid out of pocket fees and expenses of the Administrative Agent in
connection with the Existing Credit Agreement and the preparation, execution and
delivery of this Agreement, including, without limitation, the reasonable fees
and expenses of counsel for the Administrative Agent; provided that the
Administrative Agent shall cause such counsel to provide to the Borrower a
reasonably detailed invoice of such counsel's fees and expenses.
(e) Refinancing of the Initial Loans. On the Closing Date, (i) all loans
under the Existing Credit Agreement (the "Existing Loans") made by any Existing
Lender who is not a Lender hereunder shall be repaid in full and the commitments
and other obligations and rights (except as expressly set forth in the Existing
Credit Agreement) of such Existing Lender shall be
41
terminated, (ii) all outstanding Existing Loans shall be deemed Revolving Credit
Loans hereunder and the Administrative Agent shall make such transfers of funds
as are necessary in order that the outstanding balance of such Revolving Credit
Loans, together with any Revolving Credit Loans funded on the Closing Date,
reflect the Revolving Credit Commitments of the Lenders hereunder, (iii) there
shall have been paid in cash in full all accrued but unpaid interest due on the
Existing Loans to the Closing Date, (iv) there shall have been paid in cash in
full all accrued but unpaid fees under the Existing Credit Agreement due to the
Closing Date and all other amounts, costs and expenses then owing to any of the
Existing Lenders and/or Wachovia, as administrative agent under the Existing
Credit Agreement, and (v) all outstanding promissory notes issued by the
Borrower to the Existing Lenders under the Existing Credit Agreement shall be
deemed canceled and the originally executed copies thereof shall be promptly
returned to the Administrative Agent who shall forward such notes to the
Borrower.
(f) Miscellaneous.
(i) Notice of Borrowing. The Administrative Agent shall have
received a Notice of Borrowing from the Borrower in accordance with Section
2.3(a), and a Notice of Account Designation specifying the account or accounts
to which the proceeds of any Loans made after the Closing Date are to be
disbursed.
(ii) Proceedings and Documents. All opinions, certificates and other
instruments and all proceedings in connection with the transactions contemplated
by this Agreement shall be satisfactory in form and substance to the
Administrative Agent and the Lenders. The Administrative Agent and the Lenders
shall have received copies of all other instruments and other evidence they may
reasonably request, in form and substance satisfactory to them, with respect to
the transactions contemplated by this Agreement and the taking of all actions in
connection therewith.
(iii) Tax and Corporate Structure. The Administrative Agent shall be
satisfied with the tax and corporate structure of the Borrower and its
Subsidiaries.
(iv) Due Diligence and Other Documents. The Administrative Agent
shall have completed, to its satisfaction, all legal, tax and other due
diligence with respect to the business, assets, liabilities, operations and
condition (financial or otherwise) of the Borrower and its Subsidiaries in scope
and determination satisfactory to the Administrative Agent in its sole
discretion. The Borrower shall have delivered to the Administrative Agent, in
form and substance satisfactory to the Administrative Agent (i) all employment
agreements between Borrower and its key employees and (ii) such other documents,
certificates and opinions as the Administrative Agent may reasonably request.
SECTION 5.3 Conditions to All Extensions of Credit. The obligations of the
Lenders to make any Extensions of Credit (including the initial Extension of
Credit), convert or continue any Loan and/or the Issuing Lender to issue or
extend any Letter of Credit are subject to the satisfaction of the following
conditions precedent on the relevant borrowing, conversion, continuation,
issuance or extension date, as applicable:
42
(a) Continuation of Representations and Warranties. The representations
and warranties contained in Article VI shall be true and correct in all material
respects on and as of such borrowing, conversion, continuation, issuance or
extension date with the same effect as if made on and as of such date, except
for any representation and warranty made as of an earlier date, which
representation and warranty shall remain true and correct as of such earlier
date.
(b) No Existing Default. No Default or Event of Default shall have
occurred and be continuing hereunder (i) on the borrowing, conversion or
continuation date with respect to such Loan or after giving effect to the Loans
to be made on such date or (ii) or the issuance or extension date with respect
to such Letter of Credit or after giving effect to the issuance or extension of
such Letter of Credit on such date.
(c) Notices. The Administrative Agent shall have received a Notice of
Borrowing or Notice of Conversion/Continuation, as applicable, from the Borrower
in accordance with Section 2.3(a) and Section 4.2.
(d) Officer's Compliance Certificate; Additional Documents. The
Administrative Agent shall have received the current Officer's Compliance
Certificate and each additional document, instrument, legal opinion or other
item of information reasonably requested by the Administrative Agent.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
SECTION 6.1 Representations and Warranties. To induce the Administrative
Agent and Lenders to enter into this Agreement and to induce the Lenders to make
Extensions of Credit, the Borrower hereby represents and warrants to the
Administrative Agent and Lenders both before and after giving effect to the
transactions contemplated hereunder that:
(a) Organization; Power; Qualification. Each of the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or formation, has the power and
authority to own its properties and to carry on its business as now being
conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization, except where the failure
to be so qualified or authorized could not have a Material Adverse Effect on the
Borrower and its Subsidiaries. The jurisdictions in which the Borrower and its
Subsidiaries are organized and qualified to do business as of the Closing Date
are described on Schedule 6.1(a).
(b) Ownership. Each Subsidiary of the Borrower as of the Closing Date is
listed on Schedule 6.1(b). As of the Closing Date, the capitalization of the
Borrower and its Subsidiaries consists of the number of shares, authorized,
issued and outstanding, of such classes and series, with or without par value,
described on Schedule 6.1(b). All outstanding shares have been duly authorized
and validly issued and are fully paid and nonassessable, with no personal
liability attaching to the ownership thereof, and not subject to any preemptive
or similar rights. The shareholders of the Subsidiaries of the Borrower and the
number of shares owned by each as of
43
the Closing Date are described on Schedule 6.1(b). As of the Closing Date, other
than the options granted under the Borrower's plans as described in the
Borrower's Annual Report on Form 10-K for its Fiscal Year ended January 1, 2005,
there are no outstanding stock purchase warrants, subscriptions, options,
securities, instruments or other rights of any type or nature whatsoever, which
are convertible into, exchangeable for or otherwise provide for or permit the
issuance of Capital Stock of the Borrower or its Subsidiaries, except as
described on Schedule 6.1(b).
(c) Authorization of Agreement, Loan Documents and Borrowing. The Borrower
has the right, power and authority and has taken all necessary corporate and
other action to authorize the execution, delivery and performance of this
Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms. This Agreement and each of the other
Loan Documents have been duly executed and delivered by the duly authorized
officers of the Borrower, and each such document constitutes the legal, valid
and binding obligation of the Borrower, enforceable in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar state or federal debtor relief laws from
time to time in effect which affect the enforcement of creditors' rights in
general and the availability of equitable remedies.
(d) Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc.
The execution, delivery and performance by the Borrower of the Loan Documents in
accordance with their respective terms, the Extensions of Credit hereunder and
the transactions contemplated hereby do not and will not, by the passage of
time, the giving of notice or otherwise, (i) require the Borrower or any
Subsidiary to obtain any Governmental Approval or violate any Applicable Law
relating to the Borrower or any of its Subsidiaries, (ii) conflict with, result
in a breach of or constitute a default under the articles of incorporation,
bylaws or other organizational documents of the Borrower or any of its
Subsidiaries, (iii) conflict with, result in a breach of or constitute a default
under any indenture, or other material agreement or instrument to which such
Person is a party or by which any of its properties may be bound or any
Governmental Approval relating to such Person, except to the extent a breach or
default under such indenture, agreement or instrument could not have a Material
Adverse Effect, (iv) result in or require the creation or imposition of any Lien
upon or with respect to any property now owned or hereafter acquired by such
Person other than Liens arising under the Loan Documents, or (v) require any
consent or authorization of, filing with, or other act in respect of, an
arbitrator or Governmental Authority and, to the Borrower's knowledge, no
consent of any other Person is required in connection with the execution,
delivery, performance, validity or enforceability of this Agreement.
(e) Compliance with Law; Governmental Approvals. Each of the Borrower and
its Subsidiaries (i) has all Governmental Approvals required by any Applicable
Law for it to conduct its business, each of which is in full force and effect,
is final and not subject to review on appeal and is not the subject of any
pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, except where the failure to have such Governmental
Approvals could not reasonably be expected to have a Material Adverse Effect and
(ii) is in compliance with each Governmental Approval applicable to it and in
compliance with all other Applicable Laws relating to it or any of its
respective properties, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect.
44
(f) Tax Returns and Payments. Each of the Borrower and its Subsidiaries
has duly filed or caused to be filed all federal, state and material local and
other tax returns required by Applicable Law to be filed, and has paid, or made
adequate provision for the payment of, all federal, state, local and other
taxes, assessments and governmental charges or levies upon it and its property,
income, profits and assets which are due and payable, except (a) taxes,
assessments and/or governmental charges that are being contested in good faith
by appropriate proceedings or (b) to the extent that the failure to do so could
not reasonably be expected to have a Material Adverse Effect. Such returns
accurately reflect in all material respects all liability for taxes of the
Borrower and its Subsidiaries for the periods covered thereby. Except as
described on Schedule 6.1(f), there is no ongoing audit or examination of any
material nature or, to the knowledge of the Borrower, other investigation by any
Governmental Authority of the tax liability of the Borrower and its
Subsidiaries. No Governmental Authority has asserted any Lien or other claim
against the Borrower or any Subsidiary thereof with respect to unpaid taxes
(except for taxes not yet due) which has not been discharged or resolved. The
charges, accruals and reserves on the books of the Borrower and any of its
Subsidiaries in respect of federal, state, local and other taxes for all Fiscal
Years and portions thereof since the organization of the Borrower and any of its
Subsidiaries are in the judgment of the Borrower adequate, and the Borrower does
not anticipate any additional taxes or assessments for any of such years.
(g) Intellectual Property Matters. Each of the Borrower and its
Subsidiaries owns or possesses rights to use all franchises, licenses,
copyrights, copyright applications, patents, patent rights or licenses, patent
applications, trademarks, trademark rights, service ▇▇▇▇, service ▇▇▇▇ rights,
trade names, trade name rights, copyrights and rights with respect to the
foregoing which are required to conduct its business, except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect. No
event has occurred which, to the knowledge of the Borrower, permits, or after
notice or lapse of time or both would permit, the revocation or termination of
any such rights, and, to the knowledge of the Borrower, neither the Borrower nor
any Subsidiary thereof is liable to any Person for infringement under Applicable
Law with respect to any such rights as a result of its business operations,
except as could not reasonably be expected to have a Material Adverse Effect.
(h) Environmental Matters. Except as could not reasonably be expected to
have a Material Adverse Effect:
(i) To the knowledge of the Borrower, the properties owned, leased
or operated by the Borrower and its Subsidiaries now or in the past do not
contain, and to their knowledge have not previously contained, any Hazardous
Materials in amounts or concentrations which (A) constitute or constituted a
violation of applicable Environmental Laws or (B) could reasonably be expected
to give rise to liability under applicable Environmental Laws;
(ii) The Borrower, each Subsidiary and such properties and all
operations conducted in connection therewith are in compliance, and have been in
compliance, with all applicable Environmental Laws and, to the knowledge of the
Borrower, there is no contamination at, under or about such properties or such
operations which could reasonably be expected to interfere with the continued
operation of such properties;
45
(iii) Neither the Borrower nor any Subsidiary thereof has received
any notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters, Hazardous Materials, or
compliance with Environmental Laws, nor does the Borrower or any Subsidiary
thereof have knowledge that any such notice will be received or is being
threatened;
(iv) To the knowledge of the Borrower, Hazardous Materials have not
been transported or disposed of to or from the properties owned, leased or
operated by the Borrower and its Subsidiaries in violation of, or in a manner or
to a location which could reasonably be expected to give rise to liability
under, Environmental Laws, nor, to the knowledge of the Borrower, have any
Hazardous Materials been generated, treated, stored or disposed of at, on or
under any of such properties in violation of, or in a manner that could
reasonably be expected to give rise to liability under, any applicable
Environmental Laws;
(v) No judicial proceedings or governmental or administrative action
is pending, or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary thereof is or will be
named as a potentially responsible party with respect to such properties or
operations conducted in connection therewith, nor are there any consent decrees
or other decrees, consent orders, administrative orders or other orders, or
other administrative or judicial requirements outstanding under any
Environmental Law with respect to Borrower, any Subsidiary or such properties or
operations; and
(vi) To the Borrower's knowledge, there has been no release, or
threat of release, of Hazardous Materials at or from properties owned, leased or
operated by the Borrower or any Subsidiary, now or in the past, in violation of
or in amounts or in a manner.
(i) ERISA.
(i) As of the Closing Date, neither the Borrower nor any ERISA
Affiliate maintains or contributes to, or has any obligation under, any Employee
Benefit Plans other than those identified on Schedule 6.1(i);
(ii) The Borrower and each ERISA Affiliate is in compliance with all
applicable provisions of ERISA and the regulations and published interpretations
thereunder with respect to all Employee Benefit Plans except for any required
amendments for which the remedial amendment period as defined in Section 401(b)
of the Code has not yet expired, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. Each Employee Benefit
Plan that is intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified, and each trust
related to such plan has been determined to be exempt under Section 501(a) of
the Code. No liability has been incurred by the Borrower or any ERISA Affiliate
which remains unsatisfied for any taxes or penalties with respect to any
Employee Benefit Plan or any Multiemployer Plan, except where such liability
could not reasonably be expected to have a Material Adverse Effect;
(iii) No Pension Plan has been terminated, nor has any accumulated
funding deficiency (as defined in Section 412 of the Code) been incurred
(without regard to any waiver
46
granted under Section 412 of the Code), nor has any funding waiver from the
Internal Revenue Service been received or requested with respect to any Pension
Plan, nor has the Borrower or any ERISA Affiliate failed to make any
contributions or to pay any amounts due and owing as required by Section 412 of
the Code, Section 302 of ERISA or the terms of any Pension Plan prior to the due
dates of such contributions under Section 412 of the Code or Section 302 of
ERISA, nor has there been any event requiring any disclosure under Section
4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan;
(iv) Neither the Borrower nor any ERISA Affiliate has: (A) engaged
in a nonexempt prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, which would result in material liability under ERISA
or the Code, (B) incurred any liability to the PBGC which remains outstanding
other than the payment of premiums and there are no premium payments which are
due and unpaid, (C) failed to make a required contribution or payment to a
Multiemployer Plan, or (D) failed to make a required installment or other
required payment under Section 412 of the Code, except where any of the
foregoing individually or in the aggregate could not be expected to have a
Material Adverse Effect;
(v) No Termination Event that could reasonably be expected to result
in a Material Adverse Effect has occurred or is reasonably expected to occur;
and
(vi) No proceeding, claim (except for ordinary claims for benefits
under an Employee Benefit Plan), lawsuit and/or investigation is existing or, to
the best knowledge of the Borrower after due inquiry, threatened concerning or
involving any (A) employee welfare benefit plan (as defined in Section 3(1) of
ERISA) currently maintained or contributed to by the Borrower or any ERISA
Affiliate, (B) Pension Plan or (C) Multiemployer Plan, that could reasonably be
expected to have a Material Adverse Effect.
(j) Margin Stock. Neither the Borrower nor any Subsidiary thereof is
engaged principally or as one of its activities in the business of extending
credit for the purpose of "purchasing" or "carrying" any "margin stock" (as each
such term is defined or used in Regulation U of the Board of Governors of the
Federal Reserve System). No part of the proceeds of any of the Loans or Letters
of Credit will be used for purchasing or carrying margin stock or for any
purpose which violates, or which would be inconsistent with, the provisions of
Regulation T, U or X of such Board of Governors.
(k) Government Regulation. Neither the Borrower nor any Subsidiary thereof
is an "investment company" or a company "controlled" by an "investment company"
(as each such term is defined or used in the Investment Company Act of 1940, as
amended) and neither the Borrower nor any Subsidiary thereof is, or after giving
effect to any Extension of Credit will be, subject to regulation under the
Public Utility Holding Company Act of 1935 or the Interstate Commerce Act, each
as amended, or any other Applicable Law which limits its ability to incur or
consummate the transactions contemplated hereby.
(l) Financial Statements. The (i) audited Consolidated balance sheets of
the Borrower and its Subsidiaries as of January 1, 2005, and the related
Consolidated statements of earnings and cash flows and shareholders' equity for
the Fiscal Years then ended and (ii) internally-prepared unaudited Consolidated
balance sheet of the Borrower and its Subsidiaries as
47
of July 2, 2005, and related internally-prepared unaudited Consolidated interim
statements of earnings and cash flows and shareholders' equity in form and
substance consistent with the financial statements set forth in the Borrower's
Form 10-Q filed with the SEC for its fiscal quarter ended July 2, 2005, copies
of which have been furnished to the Administrative Agent and each Lender, are
materially complete and correct and fairly present, in all material respects,
the assets, liabilities and financial position of the Borrower and its
Subsidiaries as at such dates, and the results of the operations and changes of
financial position for the periods then ended. All such financial statements,
including the related schedules and notes thereto, have been prepared in
accordance with GAAP.
(m) No Material Adverse Effect. Except as set forth on Schedule 6.1(m),
since January 1, 2005, there has been no Material Adverse Effect.
(n) Solvency. As of the Closing Date and after giving effect to each
Extension of Credit made hereunder, the Borrower and, on a combined basis, its
Subsidiaries will be Solvent.
(o) Liens. None of the properties and assets of the Borrower or any
Subsidiary thereof is subject to any Lien, except Liens permitted pursuant to
Section 10.3.
(p) Debt and Guaranty Obligations. Schedule 6.1(p) is a complete and
correct listing of all Debt and Guaranty Obligations of the Borrower and its
Subsidiaries as of the Closing Date in excess of $5,000,000 (per occurrence). No
default or event of default, or event or condition which with notice or lapse of
time or both would constitute such a default or event of default on the part of
the Borrower or its Subsidiaries exists with respect to any such Debt or
Guaranty Obligation.
(q) Litigation. Except for matters existing on the Closing Date and set
forth on Schedule 6.1(q), there are no actions, suits or proceedings pending
nor, to the knowledge of the Borrower, threatened against or in any other way
relating adversely to or affecting the Borrower or any Subsidiary thereof or any
of their respective properties in any court or before any arbitrator of any kind
or before or by any Governmental Authority, which could reasonably be expected
to have a Material Adverse Effect.
(r) Absence of Defaults. No event has occurred or is continuing which
constitutes a Default or an Event of Default.
(s) OFAC. None of the Borrower, any Subsidiary of the Borrower or any
Affiliate of the Borrower: (i) is a Sanctioned Person, (ii) has more than 10% of
its assets in Sanctioned Entities, or (iii) derives more than 10% of its
operating income from investments in, or transactions with Sanctioned Persons or
Sanctioned Entities. The proceeds of any Loan will not be used and have not been
used to fund any operations in, finance any investments or activities in, or
make any payments to, a Sanctioned Person or a Sanctioned Entity.
(t) Senior Debt Status. The Obligations of the Borrower under this
Agreement and each of the other Loan Documents ranks and shall continue to rank
at least senior in priority of payment to all Subordinated Debt and at least
pari passu with all senior Debt (in each case as permitted under Section 10.1)
of the Borrower and is designated as, and constitutes, "Senior
48
Indebtedness" under all instruments and documents, now or in the future,
relating to all Subordinated Debt (in each case as permitted under Section 10.1)
of such Person.
(u) Disclosure. No financial statement, material report, material
certificate or other material information furnished, taken together as a whole,
by or on behalf of any of the Borrower or any of its Subsidiaries to the
Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, pro forma financial information, estimated financial information
and other projected or estimated information, such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
SECTION 6.2 Survival of Representations and Warranties, Etc. All
representations and warranties set forth in this Article VI and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including but not limited to any such representation or warranty made
in or in connection with any amendment thereto) shall constitute representations
and warranties made under this Agreement. All representations and warranties
made under this Agreement shall be made or deemed to be made at and as of the
Closing Date, shall survive the Closing Date and shall not be waived by the
execution and delivery of this Agreement, any investigation made by or on behalf
of the Lenders or any borrowing hereunder.
ARTICLE VII
FINANCIAL INFORMATION AND NOTICES
Until all the Obligations have been finally paid and satisfied in full and
the Commitments terminated, unless consent has been obtained in the manner set
forth in Section 13.11, the Borrower will furnish or cause to be furnished to
the Administrative Agent at the Administrative Agent's Office and to the Lenders
at their respective addresses as set forth on the Register, or such other office
as may be designated by the Administrative Agent and Lenders from time to time:
SECTION 7.1 Financial Statements and Projections.
(a) Quarterly Financial Statements. As soon as practicable and in any
event within forty-five (45) days after the end of the first three (3) fiscal
quarters of each Fiscal Year (or, if either such date is earlier, on the date of
any required public filing thereof or five (5) days following any date on which
the Borrower may be required to file such statements), an unaudited Consolidated
balance sheet of the Borrower and its Subsidiaries as of the close of such
fiscal quarter and unaudited statements of earnings and cash flows in form and
substance consistent with the financial statements set forth in the Borrower's
Form 10-Q filed with the SEC for such fiscal quarter and a report containing
management's discussion and analysis of such financial statements for the fiscal
quarter then ended and that portion of the Fiscal Year then ended, including the
notes thereto, all in reasonable detail setting forth in comparative form the
corresponding figures for the preceding Fiscal Year and prepared by the Borrower
in accordance
49
with GAAP and, if applicable, containing disclosure of the effect on the
financial position or results of operations of any change in the application of
accounting principles and practices during the period, and certified by the
chief financial officer of the Borrower to present fairly in all material
respects the financial condition of the Borrower and its Subsidiaries as of
their respective dates and the results of operations of the Borrower and its
Subsidiaries for the respective periods then ended, subject to normal year end
adjustments. Delivery by the Borrower to the Administrative Agent and the
Lenders of the Borrower's quarterly report to the SEC on Form 10-Q with respect
to any fiscal quarter, or the availability of such report on ▇▇▇▇▇ Online,
within the period specified above shall be deemed to be compliance by the
Borrower with this Section 7.1(a).
(b) Annual Financial Statements. As soon as practicable and in any event
within ninety (90) days after the end of each Fiscal Year (or, if either such
date is earlier, on the date of any required public filing thereof or five (5)
days following any date on which the Borrower may be required to file such
statements), an audited Consolidated balance sheet of the Borrower and its
Subsidiaries as of the close of such Fiscal Year and audited Consolidated
statements of income, shareholders' equity and cash flows and a report
containing management's discussion and analysis of such financial statements for
the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures for the
preceding Fiscal Year and prepared by an independent certified public accounting
firm acceptable to the Administrative Agent in accordance with GAAP and, if
applicable, containing disclosure of the effect on the financial position or
results of operation of any change in the application of accounting principles
and practices during the year, and accompanied by a report thereon by such
certified public accountants that is not qualified with respect to scope
limitations imposed by the Borrower or any of its Subsidiaries or with respect
to accounting principles followed by the Borrower or any of its Subsidiaries not
in accordance with GAAP. Delivery by the Borrower to the Administrative Agent
and the Lenders of the Borrower's annual report to the SEC on Form 10-K with
respect to any Fiscal Year, or the availability of such report on ▇▇▇▇▇ Online,
within the period specified above shall be deemed to be compliance by the
Borrower with this Section 7.1(b).
SECTION 7.2 Officer's Compliance Certificate. At each time financial
statements are delivered pursuant to Sections 7.1 (a) or (b) and at such other
times as the Administrative Agent shall reasonably request, a certificate of the
chief financial officer or the treasurer of the Borrower in the form of Exhibit
F attached hereto (an "Officer's Compliance Certificate").
SECTION 7.3 Accountants' Certificate. At each time financial statements
are delivered pursuant to Section 7.1(b), a certificate of the independent
public accountants certifying such financial statements, or any other
independent registered public accounting firm reasonably acceptable to the
Administrative Agent and the Borrower in the event that the Borrower's
independent registered public accounting firm is unable to deliver such
certificate, that in connection with their audit, nothing came to their
attention that caused them to believe that the Borrower failed to comply with
the terms, covenants, provisions or conditions of Article IX, insofar as they
relate to financial and accounting matters or, if such is not the case,
specifying such non-compliance and its nature and period of existence.
50
SECTION 7.4 Other Reports. Such information regarding the operations,
business affairs and financial condition of the Borrower or any of its
Subsidiaries as the Administrative Agent or any Lender may reasonably request.
SECTION 7.5 Notice of Litigation and Other Matters. Prompt (but in no
event later than ten (10) days after a Responsible Officer of the Borrower
obtains knowledge thereof) telephonic and written notice of:
(a) the commencement of all proceedings and investigations by or before
any Governmental Authority and all actions and proceedings in any court or
before any arbitrator against or involving the Borrower or any Subsidiary
thereof or any of their respective properties, assets or businesses, except
where such proceeding or investigation could not reasonably be expected to have
a Material Adverse Effect;
(b) any notice of any violation received by the Borrower or any Subsidiary
thereof from any Governmental Authority including, without limitation, any
notice of violation of Environmental Laws which in any such case could
reasonably be expected to have a Material Adverse Effect;
(c) (i) any Default or Event of Default; and
(d) (i) any unfavorable determination letter from the Internal Revenue
Service regarding the qualification of an Employee Benefit Plan under Section
401(a) of the Code (along with a copy thereof) which could reasonably be
expected to have a Material Adverse Effect, (ii) all notices received by the
Borrower or any ERISA Affiliate of the PBGC's intent to terminate any Pension
Plan or to have a trustee appointed to administer any Pension Plan, (iii) all
notices received by the Borrower or any ERISA Affiliate from a Multiemployer
Plan sponsor concerning the imposition or amount of withdrawal liability
pursuant to Section 4202 of ERISA and (iv) the Borrower obtaining knowledge or
reason to know that the Borrower or any ERISA Affiliate has filed or intends to
file a notice of intent to terminate any Pension Plan under a distress
termination within the meaning of Section 4041(c) of ERISA; and
(e) any event which makes any of the representations set forth in Section
6.1 inaccurate in any material respect.
SECTION 7.6 Accuracy of Information. All written information, reports,
statements and other papers and data furnished by or on behalf of the Borrower
or any of its Subsidiaries to the Administrative Agent or any Lender (other than
financial forecasts) whether pursuant to this Article VII or any other provision
of this Agreement or any other Loan Document, shall be, at the time the same is
so furnished, complete and correct in all material respects.
ARTICLE VIII
AFFIRMATIVE COVENANTS
51
Until all of the Obligations have been paid and satisfied in full and the
Commitments terminated, unless consent has been obtained in the manner provided
for in Section 13.11, the Borrower will, and will cause each of its Subsidiaries
to:
SECTION 8.1 Preservation of Corporate Existence and Related Matters.
Except as permitted by Section 10.5, preserve and maintain its separate
corporate existence and all rights, franchises, licenses and privileges
necessary to the conduct of its business, and qualify and remain qualified as a
foreign corporation and authorized to do business in each jurisdiction where the
nature and scope of its activities require it to so qualify under Applicable Law
or in which the failure to so qualify could have a Material Adverse Effect;
provided however, that the Borrower shall not be required to preserve the
corporate existence of any Subsidiary or any right, franchise, license or
privilege if the Board of Directors of the Borrower (or in the case of a
Subsidiary having assets of $100,000 or less (after giving effect to any
Disposition permitted by Section 10.6), a Responsible Officer of the Borrower
acting with authority duly delegated by the Board of Directors) shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Borrower or such Subsidiary and that the loss thereof is not
disadvantageous in any material respect to the conduct of the business of the
Borrower or such Subsidiary.
SECTION 8.2 Maintenance of Property. Protect and preserve all properties
useful in and material to its business, including copyrights, patents, trade
names and trademarks; maintain in good working order and condition all
buildings, equipment and other tangible real and personal property material to
the conduct of its business, ordinary wear and tear excepted; and from time to
time make or cause to be made all renewals, replacements and additions to such
property necessary for the conduct of its business, so that the business carried
on in connection therewith may be properly and advantageously conducted at all
times.
SECTION 8.3 Insurance. Maintain insurance with financially sound and
reputable insurance companies against such risks and in such amounts as are
customarily maintained by similar businesses and as may be required by
Applicable Law.
SECTION 8.4 Accounting Methods and Financial Records. Maintain a system of
accounting, and keep such books, records and accounts (which shall be true and
complete in all material respects) as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.
SECTION 8.5 Payment and Performance of Obligations. Pay and perform all
Obligations under this Agreement and the other Loan Documents (and all accrued
but unpaid interest, fees, expenses and other obligations under the Existing
Credit Agreement) and pay or perform (a) all material taxes, assessments and
other governmental charges that may be levied or assessed upon it or any of its
property, and (b) all other indebtedness, obligations and liabilities in
accordance with customary trade practices; provided, that the Borrower or such
Subsidiary may contest any item described in clauses (a) or (b) of this Section
8.5 in good faith so long as adequate reserves are maintained with respect
thereto in accordance with GAAP.
52
SECTION 8.6 Compliance With Laws and Approvals. Observe and remain in
compliance with all Applicable Laws and maintain in full force and effect all
Governmental Approvals, in each case applicable to the conduct of its business,
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect.
SECTION 8.7 Environmental Laws. In addition to and without limiting the
generality of Section 8.6, (a) comply with all applicable Environmental Laws and
obtain and comply with and maintain any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws, except where the failure to so comply could not reasonably be expected to
have a Material Adverse Effect, (b) conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws, and promptly comply with all lawful orders
and directives of any Governmental Authority regarding Environmental Laws except
(i) where the failure to do so could not reasonably be expected to have a
Material Adverse Effect or (ii) to the extent the Borrower or any Subsidiary is
contesting in good faith any such requirement, order or directive, and (c)
defend, indemnify and hold harmless the Administrative Agent and the Lenders,
and their respective parents, Subsidiaries, Affiliates, employees, agents,
officers and directors, from and against any claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or nature
known or unknown, contingent or otherwise, arising out of, or in any way
relating to the presence of Hazardous Materials, or the violation of,
noncompliance with or liability under any Environmental Laws applicable to the
operations of the Borrower or such Subsidiary, or any orders, requirements or
demands of Governmental Authorities related thereto, including, without
limitation, reasonable attorney's and consultant's fees, investigation and
laboratory fees, response costs, court costs and litigation expenses, except to
the extent that any of the foregoing directly result from the gross negligence
or willful misconduct of the party seeking indemnification therefor as
determined by a court of competent jurisdiction by final nonappealable judgment.
SECTION 8.8 Compliance with ERISA. In addition to and without limiting the
generality of Section 8.6, (a) comply with all applicable provisions of ERISA
and the regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, except where the failure to comply could not reasonably
be expected to have a Material Adverse Effect, (b) not take any action or fail
to take action the result of which could be a liability to the PBGC or to a
Multiemployer Plan in an amount that could reasonably be expected to have a
Material Adverse Effect and (c) furnish to the Administrative Agent upon the
Administrative Agent's request such additional information about any Employee
Benefit Plan as may be reasonably requested by the Administrative Agent.
SECTION 8.9 Conduct of Business. Engage only in businesses in
substantially the same fields as the businesses conducted on the Closing Date
and in lines of business reasonably related thereto.
SECTION 8.10 Visits and Inspections. Upon two (2) Business Days prior
notice to the Borrower, permit representatives of the Administrative Agent or
any Lender, from time to time, to visit and inspect its properties; inspect,
audit and make extracts from its books, records and files, including, but not
limited to, management letters prepared by independent accountants;
53
and discuss with its principal officers, and its independent accountants, its
business, assets, liabilities, financial condition, results of operations and
business prospects.
SECTION 8.11 Further Assurances. Make, execute and deliver all such
additional and further acts, things, deeds and instruments as the Administrative
Agent or any Lender may reasonably require to document and consummate the
transactions contemplated hereby and to vest completely in and insure the
Administrative Agent and the Lenders their respective rights under this
Agreement, the Notes, the Letters of Credit, and the other Loan Documents.
ARTICLE IX
FINANCIAL COVENANTS
Until all of the Obligations have been paid and satisfied in full and the
Commitments terminated, unless consent has been obtained in the manner set forth
in Section 13.11, the Borrower and its Subsidiaries on a Consolidated basis will
not:
SECTION 9.1 Interest Coverage Ratio. As of any fiscal quarter end, permit
the ratio of (a) EBITDA for the period of four (4) consecutive fiscal quarters
ending on or immediately prior to such date to (b) Interest Expense for the
period of four (4) consecutive fiscal quarters ending on or immediately prior to
such date to be less than the corresponding ratio set forth below:
Period Ratio
------------------------------ -------------------
Closing Date through
September 30, 2007 3.00 to 1.00
October 1, 2007 and thereafter 3.50 to 1.00
SECTION 9.2 Leverage Ratio. As of any fiscal quarter end, permit the ratio
on such date of (a) Total Debt to (b) EBITDA for the period of four (4)
consecutive fiscal quarters ending on or immediately prior to such date to be
greater than 3.75 to 1.00.
ARTICLE X
NEGATIVE COVENANTS
Until all of the Obligations have been finally paid and satisfied in full
and the Commitments terminated, unless consent has been obtained in the manner
set forth in Section 13.11, the Borrower has not and will not permit any of its
Subsidiaries to:
SECTION 10.1 Limitations on Total Debt. Create, incur, assume or suffer to
exist any Total Debt except:
(a) the Obligations;
(b) Debt incurred in connection with a Hedging Agreement;
54
(c) intercompany debt (i) owed by any Subsidiary or Performance Insurance
to the Borrower or (ii) owed by the Borrower, any Subsidiary or Performance
Insurance to any other Subsidiary or Performance Insurance (collectively, the
"Intercompany Debt");
(d) Debt existing on the Closing Date and not otherwise permitted under
this Section 10.1, as set forth on Schedule 6.1(p) and the renewal and
refinancing (but not the increase in the aggregate principal amount thereof)
thereof;
(e) Debt of the Borrower and its Subsidiaries incurred in connection with
(i) Capital Leases and (ii) purchase money Debt, in each case excluding any Debt
incurred or assumed in connection with any Permitted Acquisition;
(f) Debt consisting of Guaranty Obligations permitted by Section 10.2;
(g) the Receivables Purchase Facility; and
(h) Debt of the Borrower and its Subsidiaries not otherwise permitted
pursuant to this Section 10.1; provided that at the time of each incurrence of
such Debt and after giving effect to each such incurrence, (i) no Default or
Event of Default has occurred and is continuing and (ii) the Borrower is in pro
forma compliance with each of the covenants set forth in Article IX;
provided, that no agreement or instrument with respect to Debt permitted to be
incurred by this Section 10.1 shall restrict, limit or otherwise encumber (by
covenant or otherwise) the ability of any Subsidiary (other than PFG Receivables
Corporation) of the Borrower to make any payment to the Borrower or any of its
Subsidiaries (in the form of dividends, intercompany advances or otherwise) for
the purpose of enabling the Borrower to pay the Obligations.
SECTION 10.2 Limitations on Guaranty Obligations. Create, incur, assume or
suffer to exist any Guaranty Obligations except:
(a) Guaranty Obligations in favor of the Administrative Agent for the
benefit of the Administrative Agent and the Lenders;
(b) Guaranty Obligations of the Borrower or any Subsidiary on account of
trade payables arising out of the ordinary course of business;
(c) Guaranty Obligations of the Borrower on account of operating leases,
including, but not limited to, real property and equipment leases, entered into
by any Subsidiary or Performance Insurance; and
(d) Guaranty Obligations with respect to Debt permitted under Section
10.1; provided that at the time of each incurrence of such Guaranty Obligations
and after giving effect to each such incurrence, (i) no Default or Event of
Default has occurred and is continuing and (ii) the Borrower is in pro forma
compliance with each of the covenants set forth in Article IX.
55
SECTION 10.3 Limitations on Liens Create, incur, assume or suffer to
exist, any Lien on or with respect to any of its assets or properties (including
without limitation shares of Capital Stock or other ownership interests), real
or personal, whether now owned or hereafter acquired, except:
(a) Liens for taxes, assessments and other governmental charges or levies
(excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) not yet due or as to which the period of grace (not to
exceed thirty (30) days), if any, related thereto has not expired, or, with
respect to property taxes, not yet delinquent, or which are being contested in
good faith and by appropriate proceedings if adequate reserves are maintained to
the extent required by GAAP;
(b) the claims of materialmen, mechanics, carriers, warehousemen,
processors, landlords or growers for labor, materials, supplies, rentals or
produce incurred in the ordinary course of business, (i) which are not overdue
for a period of more than thirty (30) days or (ii) which are being contested in
good faith and by appropriate proceedings;
(c) Liens consisting of deposits or pledges made in the ordinary course of
business in connection with, or to secure payment of, obligations under workers'
compensation, unemployment insurance or similar legislation or obligations (not
to exceed $1,000,000) under customer service contracts;
(d) Liens constituting encumbrances in the nature of zoning restrictions,
easements and rights or restrictions of record on the use of real property,
which in the aggregate are not substantial in amount and which do not, in any
case, materially detract from the value of such property or impair the use
thereof in the ordinary conduct of business;
(e) Liens of the Administrative Agent for the benefit of the
Administrative Agent and the Lenders;
(f) Liens not otherwise permitted by this Section 10.3 and in existence on
the Closing Date and described on Schedule 10.3;
(g) Liens securing purchase money Debt permitted under Section 10.1(e);
provided that (i) such Liens shall be created substantially simultaneously with
the acquisition of the related asset, (ii) such Liens do not at any time
encumber any property other than the property financed by such Debt, (iii) the
amount of Debt secured thereby is not increased and (iv) the principal amount of
Debt secured by any such Lien shall at no time exceed one hundred percent (100%)
of the original purchase price of such property at the time it was acquired;
(h) Liens on or ownership interests in accounts receivable granted in
connection with the Receivables Purchase Agreement; and
(i) Liens securing up to $50,000,000 in the aggregate of Debt permitted
under Section 10.1(h).
SECTION 10.4 Limitations on Loans, Advances, Investments and Acquisitions.
Purchase, own, invest in or otherwise acquire, directly or indirectly, any
Capital Stock, interests
56
in any partnership or joint venture (including without limitation the creation
or capitalization of any Subsidiary), evidence of Debt or other obligation or
security, substantially all or a portion of the business or assets of any other
Person or any other investment or interest whatsoever in any other Person, or
make or permit to exist, directly or indirectly, any loans, advances or
extensions of credit to, or any investment in cash or by delivery of property
in, any Person except:
(a) investments not otherwise permitted by this Section 10.4 in
Subsidiaries or Performance Insurance (so long as the Borrower complies with the
applicable provisions of Sections 10.4(c)) and the other existing loans,
advances and investments not otherwise permitted by this Section 10.4 described
on Schedule 10.4;
(b) investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any agency thereof
maturing within one hundred twenty (120) days from the date of acquisition
thereof, (ii) commercial paper maturing no more than one hundred twenty (120)
days from the date of creation thereof and currently having the highest rating
obtainable from either Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or ▇▇▇▇▇'▇ Investors Service, Inc., (iii)
certificates of deposit maturing no more than one hundred twenty (120) days from
the date of creation thereof issued by commercial banks incorporated under the
laws of the United States of America, each having combined capital, surplus and
undivided profits of not less than $500,000,000 and having a rating of "A" or
better by a nationally recognized rating agency; provided, that the aggregate
amount invested in such certificates of deposit shall not at any time exceed
$10,000,000 for any one such certificate of deposit and $50,000,000 for any one
such bank, (iv) time deposits maturing no more than thirty (30) days from the
date of creation thereof with commercial banks or savings banks or savings and
loan associations each having membership either in the FDIC or the deposits of
which are insured by the FDIC and in amounts not exceeding the maximum amounts
of insurance thereunder, or (v) money market mutual funds organized under the
laws of the United States or any State thereof which have daily pricing and
daily redemption features and invest at least ninety percent (90%) of their
assets in the investments described in clauses (i) through (iv) of this Section
10.4(b);
(c) investments by the Borrower or any Subsidiary in the form of
acquisitions of all or substantially all of the business or a line of business
(whether by the acquisition of Capital Stock, assets or any combination thereof)
of any other Person which are consummated in accordance with all of the
following requirements of this Section 10.4(c) (any such acquisition, a
"Permitted Acquisition"):
(i) the Person to be acquired shall be in a substantially similar
line of business as the Borrower (or a line of business reasonably related
thereto);
(ii) no Default or Event of Default shall have occurred and be
continuing both before and after giving effect to the proposed acquisition; and
(iii) the proposed acquisition shall be non-hostile (as evidenced by
(A) the approval of the acquiree's board of directors or equivalent governing
body or (B) a copy of the opinion of counsel delivered by legal counsel to the
acquiree in connection with the proposed
57
acquisition which sets forth the approval of the acquiree's board of directors
or equivalent governing body);
(d) investments in the form of loans and advances to employees in the
ordinary course of business, which, in the aggregate, do not exceed at any time
$3,000,000;
(e) investments (i) by the Borrower of the Capital Stock of a Subsidiary
or Performance Insurance in another Subsidiary or Performance Insurance, or (ii)
by a Subsidiary or Performance Insurance of its Capital Stock or the Capital
Stock of another Subsidiary in another Subsidiary;
(f) investments in the form of loans and advances permitted pursuant to
Section 10.1(c);
(g) investments by the Borrower or any of its Subsidiaries in any
Wholly-Owned Subsidiary or Performance Insurance; and
(h) investments not otherwise permitted by this Section 10.4; provided
that at the time each such investment is made and after giving effect to each
such investment, (i) no Default or Event of Default has occurred and is
continuing and (ii) the Borrower is in pro forma compliance with each of the
covenants set forth in Article IX.
Notwithstanding the foregoing, the proceeds of the sale by the Borrower on June
28, 2005 of all of the Capital Stock of certain of its Wholly-Owned Subsidiaries
which comprised the Borrower's fresh cut produce segment, including Fresh
International Corp., Fresh Advantage, Inc., Redi-Cut Foods, Inc. and K.C. Salad
Holdings, Inc. in an aggregate amount up to $700,000,000 (the "Subsidiary
Disposition Proceeds") may, in addition to the foregoing investments, be
invested through December 28, 2005 in (a) money market mutual funds organized
under the laws of the United States or any state thereof which have daily
pricing and daily redemption features and invest at least twenty-five percent
(25%) of their assets in the investments described in clauses (i) through (iv)
of Section 10.4(b) above and/or (b) tax-exempt municipal bonds and securities,
including, but not limited to dutch auction securities, demand and put
securities, commercial paper, notes and other debt obligations, in each case
having a rating of "AAA" (or the equivalent) or better from either Standard &
Poor's Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or
▇▇▇▇▇'▇ Investors Service, Inc.
SECTION 10.5 Limitations on Mergers and Liquidation. Merge, consolidate or
enter into any similar combination with any other Person or liquidate, wind-up
or dissolve itself (or suffer any liquidation or dissolution) except:
(a) the Borrower or any Subsidiary may merge or consolidate with or into
any Person; provided that (i) the Borrower or such Subsidiary, as applicable,
shall be the survivor of such merger or consolidation or (ii) the survivor of
such merger or consolidation assumes and succeeds to the Obligations of the
Borrower pursuant to an assumption agreement in form and substance reasonably
satisfactory to the Administrative Agent and the Required Lenders;
(b) any Wholly-Owned Subsidiary of the Borrower may merge with any other
Wholly-Owned Subsidiary of the Borrower;
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(c) any Wholly-Owned Subsidiary of the Borrower may merge into the Person
such Wholly-Owned Subsidiary was formed to acquire in connection with an
acquisition permitted by Section 10.4(c); and
(d) any Wholly-Owned Subsidiary of the Borrower may merge or wind-up into
the Borrower or any other Wholly-Owned Subsidiary of the Borrower.
SECTION 10.6 Limitations on Sale of Assets. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, the sale of any receivables and leasehold
interests and any sale-leaseback or similar transaction), whether now owned or
hereafter acquired except:
(a) the sale of inventory in the ordinary course of business;
(b) the sale of obsolete assets no longer used or usable in the business
of the Borrower or any of its Subsidiaries;
(c) the transfer of assets to the Borrower, any Wholly-Owned Subsidiary of
the Borrower or Performance Insurance;
(d) the sale or discount without recourse of accounts receivable arising
in the ordinary course of business in connection with the compromise or
collection thereof;
(e) the sale of accounts receivable or an interest therein pursuant to the
terms of the Receivables Purchase Facility or any similar receivables purchase
facility which complies with the terms of this Agreement;
(f) the sale of an immaterial amount of assets of the Borrower or any
Subsidiary; provided that such assets shall not consist of substantially all of
the assets of a particular line of business of the Borrower or any Subsidiary or
the ownership interests of the Borrower or any Subsidiary with respect to a
particular line of business;
(g) the transfer of assets of the Borrower or any Subsidiary pursuant to
the terms of any sale-leaseback transaction to which the Borrower or any
Subsidiary is a party; and
(h) the Borrower or any Subsidiary may Dispose of any other of its assets
provided:
(i) the consideration for such assets represents Fair Market Value
of such assets at the time of such Disposition; and
(ii) the Net Cash Proceeds of any such Disposition are (A) used to
prepay the Obligations pursuant to Section 2.4(b) or (B) reinvested (or the
Borrower or such Subsidiary shall have entered into a binding agreement to
invest such proceeds) within one hundred and eighty (180) days after such
Disposition in replacement assets to be used in the Borrower's or any of its
Subsidiaries' businesses.
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SECTION 10.7 Limitations on Dividends and Distributions. Declare or pay
any dividends upon any of its Capital Stock; purchase, redeem, retire or
otherwise acquire, directly or indirectly, any shares of its Capital Stock, or
make any distribution of cash, property or assets among the holders of shares of
its Capital Stock, or make any change in its capital structure that could
reasonably be expected to have a Material Adverse Effect; provided that:
(a) the Borrower or any Subsidiary may pay dividends in shares of its own
Capital Stock; and
(b) any Subsidiary may pay cash dividends to the Borrower; and
(c) the Borrower may pay cash dividends on its Capital Stock or purchase,
redeem, retire or otherwise acquire, directly or indirectly, shares of its
Capital Stock; provided that at the time of each such payment, purchase,
redemption or other acquisition permitted pursuant to this Section 10.7(c) and
immediately after each such payment, purchase, redemption or other acquisition,
(i) no Default or Event of Default has occurred and is continuing and (ii) the
Borrower is in pro forma compliance with each of the covenants set forth in
Article IX.
SECTION 10.8 Transactions with Affiliates. Except to the extent provided
in Section 10.4(d), directly or indirectly (a) make any loan or advance to, or
purchase or assume any note or other obligation to or from, any of its officers,
directors, shareholders or other Affiliates, or to or from any member of the
immediate family of any of its officers, directors, shareholders or other
Affiliates, or subcontract any operations to any of its Affiliates or (b) enter
into, or be a party to, any other transaction with any of its Affiliates, except
pursuant to the reasonable requirements of its business and upon fair and
reasonable terms that are no less favorable to it than it would obtain in a
comparable arm's length transaction with a Person not its Affiliate.
SECTION 10.9 Certain Accounting Changes. Change its Fiscal Year end, or,
subject to Section 13.4, make any change in its accounting treatment except as
required or permitted by GAAP.
SECTION 10.10 Amendments; Payments and Prepayments of Subordinated Debt.
(a) Amend or modify (or permit the amendment or modification of) any of
the terms or provisions of any Subordinated Debt in any respect which would
materially adversely affect the rights or interests of the Administrative Agent
and Lenders hereunder.
(b) Cancel, forgive, make any payment or prepayment on, or redeem or
acquire for value (including, without limitation, (i) by way of depositing with
any trustee with respect thereto money or securities before due for the purpose
of paying when due and (ii) at the maturity thereof) any Subordinated Debt.
SECTION 10.11 Restrictive Agreements.
(a) Enter into any Debt which contains any negative pledge on assets or
any covenants more restrictive than the provisions of Articles IX, X and XI, or
which restricts, limits
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or otherwise encumbers its ability to incur Liens to secure the Obligations
other than such limitations with respect to the assets or properties securing
such Debt.
(b) Enter into or permit to exist any agreement which impairs or limits
the ability of any Subsidiary of the Borrower (other than PFG Receivables
Corporation and Performance Insurance which are required to maintain a required
capital amount) to pay dividends to the Borrower.
ARTICLE XI
DEFAULT AND REMEDIES
SECTION 11.1 Events of Default. Each of the following shall constitute an
Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority or otherwise:
(a) Default in Payment of Principal of Loans and Reimbursement
Obligations. The Borrower shall default in any payment of principal of any Loan
or Reimbursement Obligation when and as due (whether at maturity, by reason of
acceleration or otherwise).
(b) Other Payment Default. The Borrower shall default in the payment when
and as due (whether at maturity, by reason of acceleration or otherwise) of
interest on any Loan or Reimbursement Obligation or the payment of any other
Obligation and such default shall continue unremedied for three (3) Business
Days.
(c) Misrepresentation. Any representation or warranty made by the Borrower
or any of its Subsidiaries under this Agreement, any Loan Document or any
amendment hereto or thereto, shall at any time prove to have been incorrect or
misleading in any material respect when made or deemed made.
(d) Default in Performance of Certain Covenants. The Borrower shall
default in the performance or observance of any covenant or agreement contained
in Sections 7.5(c), 8.9 or 8.10 or Articles IX or X of this Agreement.
(e) Default in Performance of Other Covenants and Conditions. The Borrower
or any Subsidiary thereof shall default in the performance or observance of (i)
Sections 7.1 or 7.2 and such default shall continue for a period of five (5)
days after the earlier of (A) the date on which a Responsible Officer shall
become aware of such default or (B) the date of notice by the Administrative
Agent to the Borrower of the existence of such default or (ii) any other term,
covenant, condition or agreement contained in this Agreement (other than as
specifically provided for otherwise in this Section 11.1) or any other Loan
Document and such default shall continue for a period of thirty (30) days after
written notice thereof has been given to the Borrower by the Administrative
Agent.
(f) Hedging Agreement. The Borrower or any of its Subsidiaries shall
default in the payment of any amount in excess of $20,000,000 due under any
Hedging Agreement and such
61
default shall continue unremedied for a period of thirty (30) days after the
date such amount shall have become due.
(g) Debt Cross-Default. The Borrower or any of its Subsidiaries shall (i)
default in the payment of any Debt (other than the Loans or any Reimbursement
Obligation) the aggregate outstanding amount of which Debt is in excess of
$30,000,000 beyond the period of grace if any, provided in the instrument or
agreement under which such Debt was created, or (ii) default in the observance
or performance of any other agreement or condition relating to any Debt (other
than the Loans or any Reimbursement Obligation) the aggregate outstanding amount
of which Debt is in excess of $30,000,000 or contained in any instrument or
agreement evidencing, securing or relating thereto or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Debt (or a
trustee or agent on behalf of such holder or holders) to cause, with the giving
of notice if required, any such Debt to become due prior to its stated maturity
(any applicable grace period having expired).
(h) Change in Control. Any person or group of persons (within the meaning
of Section 13(d) of the Securities Exchange Act of 1934, as amended), other than
the ESOP, shall obtain ownership or control in one or more series of
transactions of more than thirty-five percent (35%) of the common stock or
thirty-five percent (35%) of the voting power of the Borrower entitled to vote
in the election of members of the board of directors of the Borrower or there
shall have occurred under any indenture or other instrument evidencing any Debt
in excess of $20,000,000 any "change in control" (as defined in such indenture
or other evidence of Debt) obligating the Borrower to repurchase, redeem or
repay all or any part of the Debt or capital stock provided for therein (any
such event, a "Change in Control").
(i) Voluntary Bankruptcy Proceeding. The Borrower or any Subsidiary
thereof shall (i) commence a voluntary case under the federal bankruptcy laws
(as now or hereafter in effect), (ii) file a petition seeking to take advantage
of any other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts, (iii) consent
to or fail to contest in a timely and appropriate manner any petition filed
against it in an involuntary case under such bankruptcy laws or other laws, (iv)
apply for or consent to, or fail to contest in a timely and appropriate manner,
the appointment of, or the taking of possession by, a receiver, custodian,
trustee, or liquidator of itself or of a substantial part of its property,
domestic or foreign, (v) admit in writing its inability to pay its debts as they
become due, (vi) make a general assignment for the benefit of creditors, or
(vii) take any corporate action for the purpose of authorizing any of the
foregoing.
(j) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be
commenced against the Borrower or any Subsidiary thereof in any court of
competent jurisdiction seeking (i) relief under the federal bankruptcy laws (as
now or hereafter in effect) or under any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or adjustment of
debts, or (ii) the appointment of a trustee, receiver, custodian, liquidator or
the like for the Borrower or any Subsidiary thereof or for all or any
substantial part of their respective assets, domestic or foreign, and such case
or proceeding shall continue without dismissal or stay undismissed or unstayed
for a period of sixty (60) consecutive days, or
62
an order granting the relief requested in such case or proceeding (including,
but not limited to, an order for relief under such federal bankruptcy laws)
shall be entered.
(k) Failure of Agreements. This Agreement or any other Loan Document shall
fail to be in full force and effect or to give the Administrative Agent and/or
the Lenders the security interests, liens, rights, powers and privileges
purported to be created hereby or thereby (except as such documents may be
terminated or no longer in force and effect in accordance with the terms
thereof, other than those indemnities and provisions which by their terms shall
survive).
(l) Termination Event. The occurrence of any of the following events: (i)
the Borrower or any ERISA Affiliate fails to make full payment when due (after
giving effect to any applicable grace period) of all amounts which, under the
provisions of any Pension Plan or Section 412 of the Code, the Borrower or any
ERISA Affiliate is required to pay as contributions thereto in excess of
$10,000,000, (ii) an accumulated funding deficiency in excess of $10,000,000
occurs or exists, whether or not waived, with respect to any Pension Plan, (iii)
a Termination Event that could reasonably be expected to result in liability in
excess of $10,000,000 to the Borrower or any ERISA Affiliate or (iv) the
Borrower or any ERISA Affiliate as employers under one or more Multiemployer
Plan makes a complete or partial withdrawal from any such Multiemployer Plan and
the plan sponsor of such Multiemployer Plans notifies such withdrawing employer
that such employer has incurred a withdrawal liability requiring payments in an
amount exceeding $10,000,000.
(m) Judgment. A final judgment or order for the payment of money which
causes the aggregate amount of all such judgments to exceed $20,000,000 in any
Fiscal Year shall be entered against the Borrower or any of its Subsidiaries by
any court of competent jurisdiction and the Borrower shall not discharge the
same or provide for its discharge in accordance with its terms within ninety
(90) days from the date on entry thereof or within such longer period
(including, without limitation, any period during which the Borrower shall be
contesting a denial of coverage of its liability in respect of such judgment by
a reputable insurance carrier) during which execution of such judgment shall
have been stayed.
SECTION 11.2 Remedies. Upon the occurrence of an Event of Default, with
the consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower:
(a) Acceleration; Termination of Facilities. Declare the principal of and
interest on the Loans and the Reimbursement Obligations at the time outstanding,
and all other amounts owed to the Lenders and to the Administrative Agent under
this Agreement or any of the other Loan Documents (including, without
limitation, all L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented or shall be entitled to
present the documents required thereunder) and all other Obligations (other than
obligations owing under any Hedging Agreement), to be forthwith due and payable,
whereupon the same shall immediately become due and payable without presentment,
demand, protest or other notice of any kind, all of which are expressly waived,
anything in this Agreement or the other Loan Documents to the contrary
notwithstanding, and terminate the Facility and any right of the Borrower to
request borrowings or Letters of Credit thereunder; provided, that upon the
occurrence of an Event of Default specified in Section 11.1(i) or (j), the
Facility shall be
63
automatically terminated and all Obligations (other than obligations owing under
any Hedging Agreement) shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or in any other Loan Document to
the contrary notwithstanding.
(b) Letters of Credit. With respect to all Letters of Credit with respect
to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to the preceding paragraph, require the Borrower at such
time to deposit in a cash collateral account opened by the Administrative Agent
an amount equal to the aggregate then undrawn and unexpired amount of such
Letters of Credit. Amounts held in such cash collateral account shall be applied
by the Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay the
other Obligations on a pro rata basis. After all such Letters of Credit shall
have expired or been fully drawn upon, the Reimbursement Obligation shall have
been satisfied and all other Obligations shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned to the
Borrower.
(c) Rights of Collection. Exercise on behalf of the Lenders all of its
other rights and remedies under this Agreement, the other Loan Documents and
Applicable Law, in order to satisfy all of the Borrower's Obligations.
SECTION 11.3 Rights and Remedies Cumulative; Non-Waiver; etc. The
enumeration of the rights and remedies of the Administrative Agent and the
Lenders set forth in this Agreement is not intended to be exhaustive and the
exercise by the Administrative Agent and the Lenders of any right or remedy
shall not preclude the exercise of any other rights or remedies, all of which
shall be cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
in law or in equity or by suit or otherwise. No delay or failure to take action
on the part of the Administrative Agent or any Lender in exercising any right,
power or privilege shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
or shall be construed to be a waiver of any Event of Default. No course of
dealing between the Borrower, the Administrative Agent and the Lenders or their
respective agents or employees shall be effective to change, modify or discharge
any provision of this Agreement or any of the other Loan Documents or to
constitute a waiver of any Event of Default.
SECTION 11.4 Administrative Agent May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Borrower or any of its Subsidiaries, the
Administrative Agent (irrespective of whether the principal of any Loan or L/C
Obligation shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the principal and
interest owing and unpaid in respect of the Loans, L/C Obligations and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the
64
claims of the Lenders and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders and
the Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders and the Administrative Agent under Sections 3.3, 4.3 and
13.2) allowed in such judicial proceeding; and to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same;
(b) and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by each Lender to make such payments to the Administrative Agent and,
in the event that the Administrative Agent shall consent to the making of such
payments directly to the Lenders, to pay to the Administrative Agent any amount
due for the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 4.3 and 13.2.
Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender any plan
of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.
ARTICLE XII
THE ADMINISTRATIVE AGENT
SECTION 12.1 Appointment and Authority. Each of the Lenders and the
Issuing Lender hereby irrevocably appoints Wachovia to act on its behalf as the
Administrative Agent hereunder and under the other Loan Documents and authorizes
the Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental
thereto. The provisions of this Article are solely for the benefit of the
Administrative Agent, the Lenders and the Issuing Lender, and neither the
Borrower nor any Subsidiary thereof shall have rights as a third party
beneficiary of any of such provisions.
SECTION 12.2 Rights as a Lender. The Person serving as the Administrative
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 the
Administrative Agent and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such
Person and its Affiliates may accept deposits from, lend money to, act as the
financial advisor or in any other advisory capacity for and generally engage in
any kind of business with the Borrowers or any Subsidiary or other Affiliate
thereof as if such Person were not the Administrative Agent hereunder and
without any duty to account therefor to the Lenders.
SECTION 12.3 Exculpatory Provisions. The Administrative Agent shall not
have any duties or obligations except those expressly set forth herein and in
the other Loan Documents. Without limiting the generality of the foregoing, the
Administrative Agent:
65
(a) shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;
(b) shall not have any duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that the Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of
its counsel, may expose the Administrative Agent to liability or that is
contrary to any Loan Document or Applicable Law; and
(c) shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Borrower or any of its Affiliates that
is communicated to or obtained by the Person serving as the Administrative Agent
or any of its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or not taken
by it (i) with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Section 13.11 and Section 11.2) or (ii) in the
absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction by final nonappealable judgment. The
Administrative Agent shall be deemed not to have knowledge of any Default unless
and until notice describing such Default is given to the Administrative Agent by
the Borrower, a Lender or the Issuing Lender.
The Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document or (v) the satisfaction
of any condition set forth in Article V or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the
Administrative Agent.
SECTION 12.4 Reliance by the Administrative Agent. The Administrative
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 (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and
to have been signed, sent or otherwise authenticated by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper Person, and shall
not incur any liability for relying thereon. In determining compliance with any
condition hereunder to the making of a Loan, or the issuance of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or
the Issuing Lender, the Administrative Agent may presume that such condition is
satisfactory to such Lender or the Issuing Lender unless the Administrative
Agent shall have
66
received notice to the contrary from such Lender or the Issuing Lender prior to
the making of such Loan or the issuance of such Letter of Credit. The
Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts 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 experts.
SECTION 12.5 Delegation of Duties. The Administrative Agent may perform
any and all of its duties and exercise its rights and powers hereunder or under
any other Loan Document by or through any one or more sub-agents appointed by
the Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub-agent and to the Related Parties of the
Administrative 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 Administrative Agent.
SECTION 12.6 Resignation of Administrative Agent.
(a) The Administrative Agent may at any time give notice of its
resignation to the Lenders, the Issuing Lender and the Borrower. Upon receipt of
any such notice of resignation, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor, which shall be a bank
with an office in the United States, or an Affiliate of any such bank with an
office in the United States. If no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may on behalf of the Lenders and the Issuing
Lender, appoint a successor Administrative Agent meeting the qualifications set
forth above provided that if the Administrative Agent shall notify the Borrower
and the Lenders that no qualifying Person has accepted such appointment, then
such resignation shall nonetheless become effective in accordance with such
notice and (1) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents (except that
in the case of any collateral security held by the Administrative Agent on
behalf of the Lenders or the Issuing Lender under any of the Loan Documents, the
retiring Administrative Agent shall continue to hold such collateral security
until such time as a successor Administrative Agent is appointed) and (2) all
payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Lender and
the Issuing Lender directly, until such time as the Required Lenders appoint a
successor Administrative Agent as provided for above in this paragraph. Upon the
acceptance of a successor's appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or retired) Administrative Agent, and the
retiring Administrative Agent shall be discharged from all of its duties and
obligations hereunder or under the other Loan Documents (if not already
discharged therefrom as provided above in this paragraph). The fees payable by
the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and such
successor. After the retiring Administrative Agent's resignation hereunder and
under the other Loan Documents, the provisions of this Article and Section 13.2
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties
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in respect of any actions taken or omitted to be taken by any of them while the
retiring Administrative Agent was acting as Administrative Agent.
(b) Any resignation by Wachovia as Administrative Agent pursuant to this
Section shall also constitute its resignation as Issuing Lender and Swingline
Lender. Upon the acceptance of a successor's appointment as Administrative Agent
hereunder, (a) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring Issuing Lender and
Swingline Lender, (b) the retiring Issuing Lender and Swingline Lender shall be
discharged from all of their respective duties and obligations hereunder or
under the other Loan Documents, and (c) the successor Issuing Lender shall issue
letters of credit in substitution for the Letters of Credit, if any, outstanding
at the time of such succession or make other arrangement satisfactory to the
retiring Issuing Lender to effectively assume the obligations of the retiring
Issuing Lender with respect to such Letters of Credit.
SECTION 12.7 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender and the Issuing Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent or any other Lender or any of
their Related Parties 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 and the Issuing Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties 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 any related agreement or any document furnished
hereunder or thereunder.
SECTION 12.8 No Other Duties, etc. Anything herein to the contrary
notwithstanding, none of the syndication agents, documentation agents,
co-agents, book manager, lead manager, arranger, lead arranger or co-arranger
listed on the cover page or signature pages hereof shall have any powers, duties
or responsibilities under this Agreement or any of the other Loan Documents,
except in its capacity, as applicable, as the Administrative Agent, a Lender or
the Issuing Lender hereunder.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1 Notices.
(a) Method of Communication. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing (for
purposes hereof, the term "writing" shall include information in electronic
format such as electronic mail and internet web pages), or by telephone
subsequently confirmed in writing. Any notice shall be effective if delivered by
hand delivery or sent via electronic mail, posting on an internet web page,
telecopy, recognized overnight courier service or certified mail, return receipt
requested, and shall be presumed to be received by a party hereto (i) on the
date of delivery if delivered by hand or sent by electronic mail, posting on an
internet web page or telecopy, (ii) on the next Business Day if sent by
recognized overnight courier service and (iii) on the third Business Day
following the
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date sent by certified mail, return receipt requested. A telephonic notice to
the Administrative Agent as understood by the Administrative Agent will be
deemed to be the controlling and proper notice in the event of a discrepancy
with or failure to receive a confirming written notice.
(b) Addresses for Notices. Notices to any party shall be sent to it at the
following addresses, or any other address as to which all the other parties are
notified in writing.
If to the Borrower: Performance Food Group Company
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
and ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: Bass, ▇▇▇▇▇ & ▇▇▇▇ PLC
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: F. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Wachovia as Wachovia Bank, National Association
Administrative Agent: Charlotte Plaza, CP-8
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Syndication Agency Services
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Lender: To the address set forth on the Register
(c) Administrative Agent's Office. The Administrative Agent hereby
designates its office located at the address set forth above, or any subsequent
office which shall have been specified for such purpose by written notice to the
Borrower and Lenders, as the Administrative Agent's Office referred to herein,
to which payments due are to be made and at which Loans will be disbursed and
Letters of Credit issued.
SECTION 13.2 Expenses; Indemnity.
(a) Costs and Expenses. The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent) in connection with the syndication of the credit
facilities provided for herein, the preparation, negotiation, execution,
delivery and administration of this Agreement and the other Loan Documents or
any amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Lender in connection with the issuance,
69
amendment, renewal or extension of any Letter of Credit or any demand for
payment thereunder and (iii) all out-of-pocket expenses incurred by the
Administrative Agent, any Lender or the Issuing Lender (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any
Lender or the Issuing Lender) in connection with the enforcement or protection
of its rights (A) in connection with this Agreement and the other Loan
Documents, including its rights under this Section, or (B) in connection with
the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) Indemnification by the Borrower. The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender and the Issuing
Lender, and each Related Party of any of the foregoing Persons (each such Person
being called an "Indemnitee") against, and hold each Indemnitee harmless from,
any and all losses, claims (including, without limitation, any Environmental
Claims or civil penalties or fines assessed by OFAC), damages, liabilities and
related expenses (including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee) incurred by any Indemnitee or asserted against
any Indemnitee by any third party or by the Borrower arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder or the consummation of the transactions
contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or
proposed use of the proceeds therefrom (including any refusal by the Issuing
Lender to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by the Borrower or
any of its Subsidiaries, or any Environmental Claim related in any way to the
Borrower or any of its Subsidiaries, (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory, whether brought by a third
party or by the Borrower, and regardless of whether any Indemnitee is a party
thereto, or (v) any claim (including, without limitation, any Environmental
Claims or civil penalties or fines assessed by OFAC), investigation, litigation
or other proceeding (whether or not the Administrative Agent or any Lender is a
party thereto) and the prosecution and defense thereof, arising out of or in any
way connected with the Loans, this Agreement, any other Loan Document, or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby, including without limitation, reasonable
attorneys and consultant's fees, provided that such indemnity shall not, as to
any Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a claim
brought by the Borrower against an Indemnitee for breach in bad faith of such
Indemnitee's obligations hereunder or under any other Loan Document, if the
Borrower has obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent jurisdiction.
(c) Reimbursement by Lenders. To the extent that the Borrower for any
reason fails to indefeasibly pay any amount required under paragraph (a) or (b)
of this Section to be paid by it to the Administrative Agent (or any sub-agent
thereof), the Issuing Lender or any Related
70
Party of any of the foregoing, each Lender severally agrees to pay to the
Administrative Agent (or any such sub-agent), the Issuing Lender or such Related
Party, as the case may be, such Lender's Commitment Percentage (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 the Administrative Agent (or any such
sub-agent) or the Issuing Lender in its capacity as such, or against any Related
Party of any of the foregoing acting for the Administrative Agent (or any such
sub-agent) or Issuing Lender in connection with such capacity. The obligations
of the Lenders under this paragraph (c) are subject to the provisions of Section
4.8.
(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted
by Applicable Law, the Borrower shall not assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof. No Indemnitee referred to in paragraph (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Agreement or the other Loan Documents or the transactions contemplated hereby or
thereby.
(e) Payments. All amounts due under this Section shall be payable promptly
after demand therefor.
SECTION 13.3 Right of Set-off. If an Event of Default shall have occurred
and be continuing, each Lender, the Issuing Lender, the Swingline Lender and
each of their respective Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by Applicable Law, to set off and
apply any and all deposits (general or special, time or demand, provisional or
final, in whatever currency) at any time held and other obligations (in whatever
currency) at any time owing by such Lender, the Issuing Lender, the Swingline
Lender or any such Affiliate to or for the credit or the account of the Borrower
against any and all of the obligations of the Borrower now or hereafter existing
under this Agreement or any other Loan Document to such Lender, the Issuing
Lender or the Swingline Lender, irrespective of whether or not such Lender, the
Issuing Lender or the Swingline Lender shall have made any demand under this
Agreement or any other Loan Document and although such obligations of the
Borrower may be contingent or unmatured or are owed to a branch or office of
such Lender, the Issuing Lender or the Swingline Lender different from the
branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender, the Issuing Lender, the Swingline Lender and their
respective Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender, the Issuing
Lender, the Swingline Lender or their respective Affiliates may have. Each
Lender, the Issuing Lender and the Swingline Lender agrees to notify the
Borrower and the Administrative Agent promptly after any such setoff and
application; provided that the failure to give such notice shall not affect the
validity of such setoff and application.
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SECTION 13.4 Governing Law.
(a) Governing Law. This Agreement and the other Loan Documents, unless
expressly set forth therein, shall be governed by, and construed in accordance
with, the law of the State of North Carolina, without reference to the conflicts
or choice of law principles thereof.
(b) Submission to Jurisdiction. The Borrower irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the state and federal courts of Mecklenburg County, North
Carolina, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or any other Loan Document, or for
recognition or enforcement of any judgment, and each of the parties hereto
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such North Carolina State
court or, to the fullest extent permitted by Applicable 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 in any other Loan Document shall affect any right
that the Administrative Agent, any Lender or the Issuing Lender may otherwise
have to bring any action or proceeding relating to this Agreement or any other
Loan Document against the Borrower or its properties in the courts of any
jurisdiction.
(c) Waiver of Venue. The Borrower irrevocably and unconditionally waives,
to the fullest extent permitted by Applicable Law, any objection that it may now
or hereafter have to the laying of venue of any action or proceeding arising out
of or relating to this Agreement or any other Loan Document in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by Applicable Law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(d) Service of Process. Each party hereto irrevocably consents to service
of process in the manner provided for notices in Section 13.1. Nothing in this
Agreement will affect the right of any party hereto to serve process in any
other manner permitted by Applicable Law.
SECTION 13.5 Binding Arbitration; Waiver of Jury Trial.
(a) Binding Arbitration. Upon demand of any party, whether made before or
after institution of any judicial proceeding, any dispute, claim or controversy
arising out of, connected with or relating to this Agreement or any other Loan
Document ("Disputes"), between or among parties hereto and to the other Loan
Documents shall be resolved by binding arbitration as provided herein.
Institution of a judicial proceeding by a party does not waive the right of that
party to demand arbitration hereunder. Disputes may include, without limitation,
tort claims, counterclaims, claims brought as class actions, claims arising from
Loan Documents executed in the future, disputes as to whether a matter is
subject to arbitration, or claims concerning any aspect of the past, present or
future relationships arising out of or connected with the Loan Documents.
Arbitration shall be conducted under and governed by the Commercial Financial
Disputes Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association ("AAA") and the Federal Arbitration Act. All arbitration hearings
shall be conducted in
72
Charlotte, North Carolina. The expedited procedures set forth in Rule 51, et
seq. of the Arbitration Rules shall be applicable to claims of less than
$1,000,000. All applicable statutes of limitation shall apply to any Dispute. A
judgment upon the award may be entered in any court having jurisdiction.
Notwithstanding anything foregoing to the contrary, any arbitration proceeding
demanded hereunder shall begin within ninety (90) days after such demand thereof
and shall be concluded within one hundred and twenty (120) days after such
demand. These time limitations may not be extended unless a party hereto shows
cause for extension and then such extension shall not exceed a total of sixty
(60) days. The panel from which all arbitrators are selected shall be comprised
of licensed attorneys selected from the Commercial Financial Dispute Arbitration
Panel of the AAA. The single arbitrator selected for expedited procedure shall
be a retired judge from the highest court of general jurisdiction, state or
federal, of the state where the hearing will be conducted. The parties hereto do
not waive any applicable Federal or state substantive law except as provided
herein.
(b) Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY 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 OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON
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.
(c) Preservation of Certain Remedies. Notwithstanding the preceding
binding arbitration provisions, the parties hereto and the other Loan Documents
preserve, without diminution, certain remedies that such Persons may employ or
exercise freely, either alone, in conjunction with or during a Dispute. Each
such Person shall have and hereby reserves the right to proceed in any court of
proper jurisdiction or by self help to exercise or prosecute the following
remedies, as applicable: (i) all rights to foreclose against any real or
personal property or other security by exercising a power of sale granted in the
Loan Documents or under Applicable Law or by judicial foreclosure and sale,
including a proceeding to confirm the sale, (ii) all rights of self help
including peaceful occupation of property and collection of rents, set off, and
peaceful possession of property, (iii) obtaining provisional or ancillary
remedies including injunctive relief, sequestration, garnishment, attachment,
appointment of receiver and in filing an involuntary bankruptcy proceeding, and
(iv) when applicable, a judgment by confession of judgment. Preservation of
these remedies does not limit the power of an arbitrator to grant similar
remedies that may be requested by a party in a Dispute.
SECTION 13.6 Reversal of Payments. To the extent the Borrower makes a
payment or payments to the Administrative Agent for the ratable benefit of the
Lenders or the Administrative Agent receives any payment or proceeds of the
collateral which payments or
73
proceeds or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any bankruptcy law, state or federal law,
common law or equitable cause, then, to the extent of such payment or proceeds
repaid, the Obligations or part thereof intended to be satisfied shall be
revived and continued in full force and effect as if such payment or proceeds
had not been received by the Administrative Agent.
SECTION 13.7 Injunctive Relief; Punitive Damages.
(a) The Borrower recognizes that, in the event the Borrower fails to
perform, observe or discharge any of its obligations or liabilities under this
Agreement, any remedy of law may prove to be inadequate relief to the Lenders.
Therefore, the Borrower agrees that the Lenders, at the Lenders' option, shall
be entitled to temporary and permanent injunctive relief in any such case
without the necessity of proving actual damages.
(b) The Administrative Agent, the Lenders and the Borrower (on behalf of
itself and its Subsidiaries) hereby agree that no such Person shall have a
remedy of punitive or exemplary damages against any other party to a Loan
Document and each such Person hereby waives any right or claim to punitive or
exemplary damages that they may now have or may arise in the future in
connection with any Dispute, whether such Dispute is resolved through
arbitration or judicially.
SECTION 13.8 Accounting Matters. If at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in any
Loan Document, and either the Borrower or the Required Lenders shall so request,
the Administrative Agent, the Lenders and the Borrower shall negotiate in good
faith to amend such ratio or requirement to preserve the original intent thereof
in light of such change in GAAP (subject to the approval of the Required
Lenders); provided that, until so amended, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(ii) the Borrower shall provide to the Administrative Agent and the Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.
SECTION 13.9 Successors and Assigns; Participations.
(a) Successors and Assigns Generally. 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, except that the Borrower may
not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of the Administrative Agent and each Lender
and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an Eligible Assignee in accordance with the provisions
of paragraph (b) of this Section, (ii) by way of participation in accordance
with the provisions of paragraph (d) of this Section or (iii) by way of pledge
or assignment of a security interest subject to the restrictions of paragraph
(f) of this Section (and any other attempted assignment or transfer by any party
hereto shall be null and void). Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors
74
and assigns permitted hereby, Participants to the extent provided in paragraph
(d) of this Section and, to the extent expressly contemplated hereby, the
Related Parties of each of the Administrative Agent and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.
(b) Assignments by Lenders. Any Lender may at any time assign to one or
more Eligible Assignees (such Person, a "Purchasing Lender") 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 of the entire remaining
amount of the assigning Lender's Commitment and the Loans at the time owing to
it or in the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) or, if the
applicable Commitment is not then in effect, the principal outstanding balance
of the 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 or, if "Trade Date" is specified in the
Assignment and Assumption, as of the Trade Date) shall not be less than
$5,000,000 unless (A) such assignment is made to an existing Lender, to an
Affiliate thereof, or to an Approved Fund, in which case no minimum amount shall
apply, or (B) each of the Administrative Agent and, so long as no Default or
Event of Default has occurred and is continuing, the Borrower otherwise consent
(each such consent not to be unreasonably withheld or delayed);
(ii) 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 with respect to the Loan or the Commitment assigned;
(iii) any assignment of a Commitment must be approved by the
Administrative Agent, the Swingline Lender and the Issuing Lender unless the
Person that is the proposed assignee is itself a Lender with a Commitment
(whether or not the proposed assignee would otherwise qualify as an Eligible
Assignee);
(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, and the Eligible Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire; and
(v) such assignment shall not, without the consent of the Borrower,
require the Borrower to file a registration statement with the SEC or apply to
or qualify the Loans under the blue sky laws of any state.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the
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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 4.9, 4.10, 4.11, 4.12 and 13.2 with
respect to facts and circumstances occurring prior to the effective date of such
assignment. Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this paragraph shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (d) of this Section.
(c) Register. The Administrative Agent, acting solely for this purpose as
an agent of the Borrower, shall maintain at one of its offices in Charlotte,
North Carolina, 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
Commitments of, and principal amounts of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent 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 Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
(d) Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Administrative Agent, sell participations to any
Person (other than a natural person or the Borrower or any of the Borrower's
Affiliates or Subsidiaries) (each, a "Participant") in all or a portion of such
Lender's rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or 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 Borrower, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement.
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 this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; 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 or modification described in Section
13.11 that directly affects such Participant. Subject to paragraph (e) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 4.9, 4.10, 4.11 and 4.12 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 13.3 as though it were a Lender, provided
such Participant agrees to be subject to Section 4.7 as though it were a Lender.
(e) Limitations upon Participant Rights. A Participant shall not be
entitled to receive any greater payment under Sections 4.11 and 4.12 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the
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participation to such Participant is made with the Borrower's prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall
not be entitled to the benefits of Section 4.12 unless the Borrower is notified
of the participation sold to such Participant and such Participant agrees, for
the benefit of the Borrower, to comply with Section 4.12(e) as though it were a
Lender.
(f) Certain Pledges. 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 without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
SECTION 13.10 Confidentiality. Each of the Administrative Agent 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'
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), (b) to the extent requested
by, or required to be disclosed to, any rating agency, or regulatory or similar
authority (including any self-regulatory authority, such as the National
Association of Insurance Commissioners), (c) to the extent required by
Applicable Laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies
under this Agreement or under any other Loan Document (or any Hedging Agreement
with a Lender or the Administrative Agent) or any action or proceeding relating
to this Agreement or any other Loan Document (or any Hedging Agreement with a
Lender or the Administrative Agent) or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any Purchasing Lender, proposed Purchasing
Lender, Participant or proposed Participant (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), or (ii) any actual or prospective counterparty (or its advisors)
to any swap or derivative transaction relating to the Borrower and its
obligations (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), (g) with the consent of the
Borrower, (h) to Gold Sheets and other similar bank trade publications, such
information to consist of deal terms and other information customarily found in
such publications, or (i) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this Section or (y) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Borrower or (j) to governmental regulatory
authorities in connection with any regulatory examination of the Administrative
Agent or any Lender or in accordance with the Administrative Agent's or any
Lender's regulatory compliance policy if the Administrative Agent or such Lender
deems necessary for the mitigation of claims by those authorities against the
Administrative Agent or such Lender or any of its subsidiaries or affiliates.
For purposes of this Section, "Information" means all information received from
the Borrower or any of its Subsidiaries relating to the Borrower or any of its
Subsidiaries or any of their respective businesses, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential
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basis prior to disclosure by the Borrower or such 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 13.11 Amendments, Waivers and Consents. Except as set forth below
or as specifically provided in any Loan Document, any term, covenant, agreement
or condition of this Agreement or any of the other Loan Documents may be amended
or waived by the Lenders, and any consent given by the Lenders, if, but only if,
such amendment, waiver or consent is in writing signed by the Required Lenders
(or by the Administrative Agent with the consent of the Required Lenders) and
delivered to the Administrative Agent and, in the case of an amendment, signed
by the Borrower; provided, that no amendment, waiver or consent shall:
(a) waive any condition set forth in Section 5.2 without the written
consent of each Lender;
(b) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 11.2) or the amount of Loans of any
Lender without the written consent of such Lender;
(c) postpone any date fixed by this Agreement or any other Loan Document
for any payment or mandatory prepayment of principal, interest, fees or other
amounts due to the Lenders (or any of them) hereunder or under any other Loan
Document without the written consent of each Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest specified herein on,
any Loan or Reimbursement Obligation, or (subject to clause (iv) of the second
proviso to this Section) any fees or other amounts payable hereunder or under
any other Loan Document, or change the manner of computation of any financial
ratio (including any change in any applicable defined term) used in determining
the Applicable Margin that would result in a reduction of any interest rate on
any Loan or any fee payable hereunder without the written consent of each Lender
directly affected thereby; provided that only the consent of the Required
Lenders shall be necessary (i) to waive any obligation of the Borrower to pay
interest at the rate set forth in Section 4.1(d) during the continuance of an
Event of Default;
(e) change Section 2.5(a), Section 4.4 or Section 4.5 in a manner that
would alter the pro rata sharing of Commitment reductions or payments required
thereby without the written consent of each Lender; or
(f) change any provision of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender;
provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Lender in addition to the Lenders required
above, affect the rights or duties of the Issuing Lender under this Agreement or
any Application relating to any Letter of Credit issued or
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to be issued by it; (ii) no amendment, waiver or consent shall, unless in
writing and signed by the Swingline Lender in addition to the Lenders required
above, affect the rights or duties of the Swingline Lender under this Agreement;
(iii) no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.
SECTION 13.12 Performance of Duties. The Borrower's obligations under this
Agreement and each of the Loan Documents shall be performed by the Borrower at
its sole cost and expense.
SECTION 13.13 All Powers Coupled with Interest. All powers of attorney and
other authorizations granted to the Lenders, the Administrative Agent and any
Persons designated by the Administrative Agent or any Lender pursuant to any
provisions of this Agreement or any of the other Loan Documents shall be deemed
coupled with an interest and shall be irrevocable so long as any of the
Obligations remain unpaid or unsatisfied or the Facility has not been
terminated.
SECTION 13.14 Survival of Indemnities. Notwithstanding any termination of
this Agreement, the indemnities to which the Administrative Agent and the
Lenders are entitled under the provisions of this Article XIII and any other
provision of this Agreement and the other Loan Documents shall continue in full
force and effect and shall protect the Administrative Agent and the Lenders
against events arising after such termination as well as before.
SECTION 13.15 Titles and Captions. Titles and captions of Articles,
Sections and subsections in, and the table of contents of, this Agreement are
for convenience only, and neither limit nor amplify the provisions of this
Agreement.
SECTION 13.16 Severability of Provisions. Any provision of this Agreement
or any other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 13.17 Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and shall be binding
upon all parties, their successors and assigns, and all of which taken together
shall constitute one and the same agreement.
SECTION 13.18 Term of Agreement. This Agreement shall remain in effect
from the Closing Date through and including the date upon which the Commitments
shall have been terminated, all outstanding Letters of Credit have expired or
been cancelled and all Obligations shall have been indefeasibly and irrevocably
paid and satisfied in full. No termination of this
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Agreement shall affect the rights and obligations of the parties hereto arising
prior to such termination or in respect of any provision of this Agreement which
survives such termination.
SECTION 13.19 Independent Effect of Covenants. The Borrower expressly
acknowledges and agrees that each covenant contained in Articles VIII, IX, or X
shall be given independent effect. Accordingly, the Borrower shall not engage in
any transaction or other act otherwise permitted under any covenant contained in
Articles VIII, IX, or X if, before or after giving effect to such transaction or
act, the Borrower shall or would be in breach of any other covenant contained in
Articles VIII, IX, or X.
SECTION 13.20 Advice of Counsel. Each of the parties hereto represents to
each other party hereto that it has discussed this Agreement with its counsel.
SECTION 13.21 No Strict Construction. The parties hereto have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Agreement.
SECTION 13.22 Integration. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement. Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.
SECTION 13.23 USA Patriot Act. The Administrative Agent and each Lender
hereby notifies the Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the "Act"), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender to identify the
Borrower in accordance with the Act.
[Signature pages to follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers, all as of the day and
year first written above.
[CORPORATE SEAL] PERFORMANCE FOOD GROUP COMPANY,
as Borrower
By:_____________________________________
Name:________________________________
Title:_______________________________
[Second Amended and Restated Credit Agreement]
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent and Lender
By: _________________________________
Name: _______________________________
Title: ______________________________
[Second Amended and Restated Credit Agreement]
