EXHIBIT 10.1
FIVE-YEAR CREDIT AGREEMENT
DATED AS OF OCTOBER 17, 2001
AMONG
INVACARE CORPORATION
AND CERTAIN BORROWING SUBSIDIARIES
THE BANKS NAMED THEREIN
and
BANK ONE, MICHIGAN
as Agent
KEYBANK NATIONAL ASSOCIATION
as Syndication Agent
NATIONAL CITY BANK
as Documentation Agent
BANK OF AMERICA, N.A.,
as Documentation Agent
and
THE CHASE MANHATTAN BANK,
As Co-Agent
TABLE OF CONTENTS
Article Page
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ARTICLE I DEFINITIONS 1
1.1 Certain Definitions 1
1.2 Other Definitions; Rules of Construction 14
ARTICLE II THE COMMITMENTS AND THE ADVANCES 14
2.1 Commitments of the Banks 14
2.2 Bid-Option Loans 1
(a) The Bid-Option 17
(b) Bid-Option Quote Request 18
(c) Invitation for Bid-Option Quotes 18
(d) Submission and Contents of Bid-Option Quotes 18
(e) Notice to Borrower 19
(f) Acceptance and Notice by Borrower 19
(g) Allocation by Agent 20
2.3 Swing Loans 20
(a) Making of Swing Loans 20
(b) Swing Loan Borrowing Requests 20
(c) Repayment of Swing Loans 20
2.4 Termination and reduction of Commitments 21
2.5 Fees 22
2.6 Disbursement of Revolving Credit Advances 22
2.7 Conditions for First Disbursement 25
(a) Charter Documents 25
(b) By-Laws and Corporate Authorizations 25
(c) Incumbency Certificate 25
(d) Loan Documents 25
(e) Legal Opinion 25
(f) Consents, Approvals, Etc. 25
(g) 1997 Credit Agreement 25
(h) 364-Day Credit Agreement 26
(i) Solvency and Compliance Certificates 26
(j) Miscellaneous 26
2.8 Further Conditions for Disbursement 26
2.9 Subsequent Elections as to Borrowings 26
2.10 Limitation of Requests and Elections 27
2.11 Minimum Amounts; Limitation on Number of Borrowings 28
2.12 Treasury Manager 28
2.13 Applicable Lending Installation 28
Article Page
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ARTICLE III PAYMENTS AND PREPAYMENTS 28
3.1 Principal Payments 28
3.2 Interest Payments 30
3.3 Payment Method 30
3.4 No Setoff or Deduction 31
3.5 Payment on Non-Business Day; Payment Computations 32
3.6 Additional Costs 32
3.7 Illegality and Impossibility 34
3.8 Indemnification 34
ARTICLE IV REPRESENTATIONS AND WARRANTIES 34
4.1 Corporate Existence and Power 35
4.2 Corporate Authority 35
4.3 Binding Effect 35
4.4 Subsidiaries 35
4.5 Litigation 35
4.6 Financial Condition 35
4.7 Use of Loans 35
4.8 Consents, Etc. 36
4.9 Taxes 36
4.10 Title to Properties 36
4.11 ERISA 36
4.12 Environmental and Safety Matters 36
4.13 No Material Adverse Change 37
4.14 No Default 37
4.15 Compliance with Laws 37
ARTICLE V COVENANTS 37
5.1 Affirmative Covenants 37
(a) Preservation of Corporate Existence, Etc. 37
(b) Compliance with Laws, Etc. 37
(c) Maintenance of Properties; Insurance 38
(d) Reporting Requirements 38
(e) Accounting; Access to Records, Books, Etc. 39
(f) Stamp Taxes 39
(g) Further Assurances 39
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Article Page
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5.2 Negative Covenants 40
(a) Interest Coverage Ratio 40
(b) Net Worth 40
(c) Total Debt to Adjusted EBITDA 40
(d) Liens 40
(e) Merger; Etc. 41
(f) Disposition of Assets; Etc. 41
(g) Nature of Business 41
(h) Negative Pledge Limitation 42
(i) Limitations on Indebtedness of Subsidiaries 42
(j) Investments 42
(k) Contingent Liabilities 43
(l) Transactions with Affiliates 43
(m) Additional Covenants 44
(n) Acquisitions 44
ARTICLE VI DEFAULT 44
6.1 Events of Default 44
(a) Nonpayment of Principal 44
(b) Nonpayment of Interest 44
(c) Misrepresentation 44
(d) Certain Covenants 45
(e) Other Defaults 45
(f) Cross Default 45
(g) Judgments 45
(h) ERISA 45
(i) Insolvency, Etc 45
(j) Change of Control 46
(k) 364-Day Credit Agreement 46
(l) Loan Documents 46
6.2 Remedies 46
ARTICLE VII THE AGENT AND THE BANKS 47
7.1 Appointment and Authorization 47
7.2 Agent and Affiliates 47
7.3 Scope of Agent's Duties 48
7.4 Reliance by Agent 48
7.5 Default 48
7.6 Liability of Agent 48
7.7 Nonreliance on Agent and Other Banks 48
7.8 Indemnification 49
7.9 Resignation of Agent 49
7.10 Sharing of Payments 50
7.11 Withholding Tax Exemption 50
7.12 Co-Agent, Documentation Agents, Syndication Agent, Etc. 51
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Article Page
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ARTICLE VII MISCELLANEOUS 51
8.1 Amendments, Etc. 51
8.2 Notices 52
8.3 No Waiver By Conduct: Remedies Cumulative 52
8.4 Reliance on and Survival of Various Provisions 52
8.5 Expenses; Indemnification 53
8.6 Successors and Assigns 53
8.7 Counterparts 56
8.8 Governing Law; Consent to Jurisdiction 56
8.9 Table of Contents and Headings 56
8.10 Construction of Certain Provisions 56
8.11 Integration and Severability 56
8.12 Independence of Covenants 56
8.13 Interest Rate Limitation 56
8.14 Confidentiality 57
8.15 Waiver of Jury Trial 57
8.16 Unification of Certain Currencies 57
EXHIBITS
Exhibit A Bid-Option Note
Exhibit B Designation of new Borrowing Subsidiary
Exhibit C Guaranty
Exhibit D Revolving Credit Note
Exhibit E Swing Line Note
Exhibit F Bid-Option Quote Request
Exhibit G Invitation for Bid-Option Quotes
Exhibit H Bid-Option Quote
Exhibit I Request for Revolving Credit Advance
Exhibit J Form of Legal Opinion
Exhibit K Request for Continuation or Conversion of
Revolving Credit Loan
Exhibit L Assignment and Acceptance
Exhibit M Compliance Certificate
SCHEDULES
Pricing Schedulr
Schedule 1.1 Commitments
Schedule 4.4 Subsidiaries
Schedule 4.5 Litigation
Schedule 4.12 Environmental Matters
Schedule 5.2 (i) Liens
Schedule 5.2 (j) Investments
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FIVE-YEAR CREDIT AGREEMENT
THIS FIVE-YEAR CREDIT AGREEMENT, dated as of October 17, 2001 (as
amended or modified from time to time, this "Agreement"), is by and among
INVACARE CORPORATION, an Ohio corporation (the "Company"), each of the
Subsidiaries of the Company designated in Section 1.1 as a Borrowing Subsidiary
(individually, a "Borrowing Subsidiary" and collectively, the "Borrowing
Subsidiaries") (the Company and the Borrowing Subsidiaries may each be referred
to as a "Borrower" and, collectively, as the "Borrowers"), Invacare Corporation,
as treasury manager for the Borrowers (the "Treasury Manager") and the Banks set
forth on the signature pages hereof (collectively, the "Banks" and individually,
a "Bank") and BANK ONE, MICHIGAN, a Michigan banking corporation, as
administrative agent for the Banks (in such capacity, the "Agent").
INTRODUCTION
Pursuant to the terms of this Agreement, the Borrowers desire to obtain
a revolving credit facility, including letters of credit, in the aggregate
principal amount of $325,000,000 (or the equivalent thereof in any other
Permitted Currency), in order to refinance certain existing indebtedness under
the Existing Loan Agreement (as defined herein) and provide funds for their
general corporate purposes, and the Banks are willing to establish such a credit
facility in favor of the Borrowers on the terms and conditions herein set forth.
In consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Definitions. As used herein the following terms shall have the
following respective meanings:
"Acquisition" shall mean any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Company or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.
"Activated Alternate Currency Commitments" is defined in Section 2.1(g).
"Activated Revolving Credit Commitments" is defined in Section 2.1(g).
"Adjusted EBITDA" shall mean , with respect to any person, for any
period, the sum of (a) EBIT for such period, plus (b) all amounts deducted in
determining such EBIT on account of depreciation and amortization expense, minus
(c) any extraordinary, unusual or non-recurring gains or other income (or plus
any extraordinary, unusual or non-recurring non-cash losses) not from the
continuing operations of the Company and its Subsidiaries, and related tax
effects, in accordance with generally accepted accounting principles.
Notwithstanding anything herein, in any financial statements of the Company or
in generally accepted accounting principles to the contrary, for purposes of
calculating and determining Adjusted EBITDA, (i) any Acquisition made by the
Company or any of its Subsidiaries, including through mergers or consolidations
and including any related financing transactions, during the period for which
such Adjusted EBITDA was calculated shall be deemed to have occurred on the
first day of the relevant period for which such Adjusted EBITDA was calculated
on a pro forma basis acceptable to the Agent, but without giving effect to any
projected synergies resulting from such Acquisition and (ii) any amounts which
are attributable to any asset, investment or person which has been divested by
the Company or any Subsidiary during the period for which such Adjusted EBITDA
was calculated shall be excluded from the calculation of Adjusted EBITDA and
such divestiture shall be deemed to have occurred on the first day of the
relevant period for which such Adjusted EBITDA was calculated.
"Advance" shall mean any Loan and any Letter of Credit Advance.
"Affiliate" when used with respect to any person shall mean any other
person which, directly or indirectly, controls or is controlled by or is under
common control with such person. For purposes of this definition "control"
(including the correlative meanings of the terms "controlled by" and "under
common control with"), with respect to any person, shall mean possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such person, whether through the ownership of voting
securities or by contract or otherwise.
"Alternate Currency" means (i) so long as such currencies remain
Eligible Currencies, Canadian Dollars, Australian Dollars and Euro, and (ii) any
other Eligible Currency which the Company requests the Agent to include as an
Alternate Currency hereunder and which is acceptable to one-hundred percent
(100%) of the applicable Alternate Currency Banks; and with respect to which an
Alternate Currency Addendum has been executed among the Company, a Borrowing
Subsidiary, one or more Alternate Currency Banks and the Agent in connection
therewith.
"Alternate Currency Addendum" means a schedule and addendum entered
into among the Company, a Borrowing Subsidiary, one or more Alternate Currency
Banks and the Agent, in form and substance satisfactory to the Agent, the
Company, such Borrowing Subsidiary and such Alternate Currency Banks party
thereto.
"Alternate Currency Bank" means any Bank (including any Applicable
Lending Installation) party to an Alternate Currency Addendum.
"Alternate Currency Commitment" means, for each Alternate Currency Bank
for each Alternate Currency, the obligation of such Alternate Currency Bank to
make Alternate Currency Loans not exceeding the Dollar Equivalent set forth in
the applicable Alternate Currency Addendum, as such amount may be modified from
time to time pursuant to the terms of this Agreement and the applicable
Alternate Currency Addendum.
"Alternate Currency Loan" means any Loan denominated in an Alternate
Currency made by the Agent or one or more of the Alternate Currency Banks to a
Borrower pursuant to this Agreement and the applicable Alternate Currency
Addendum.
"Alternate Currency Share" means, with respect to any Alternate
Currency Bank for any particular Alternate Currency, the percentage obtained by
dividing (a) such Alternate Currency Bank's Alternate Currency Commitment at
such time as set forth in the applicable Alternate Currency Addendum by (b) the
aggregate of the Alternate Currency Commitments at such time of all Alternate
Currency Banks with respect to such Alternate Currency as set forth in the
applicable Alternate Currency Addendum.
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"Applicable Fee Rate" shall mean, at any time, the percentage rate per
annum at which facility fees are accruing on the Commitments (without regard to
usage) and at which letter of credit fees are paid on Letters of Credit, in each
case, at such time as set forth in the Pricing Schedule.
"Applicable Lending Installation" shall mean, with respect to any Bank,
any office(s), agency(ies), branch(es), Subsidiary(ies) or Affiliate(s) of such
Bank selected by such Bank and notified to the Company and the Agent by such
Bank from time to time and, with respect to the Agent, any office(s),
agency(ies), branch(es), Subsidiary(ies) or Affiliate(s) of the Agent selected
by the Agent and notified to the Company from time to time.
"Applicable Margin" means, with respect to Advances of any type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Assignment and Acceptance" is defined in Section 8.6(d).
"Australian Dollars" or "AUS$" shall mean the lawful currency of
Australia.
"Bank Obligations" shall mean all indebtedness, obligations and
liabilities, whether now owing or hereafter arising, direct, indirect,
contingent or otherwise, of the Borrowers to the Agent or any Bank pursuant to
the Loan Documents.
"Bid-Option Auction" shall mean a solicitation of Bid-Option Quotes
setting forth Bid-Option Rates pursuant to Section 2.2(b).
"Bid-Option Interest Period" shall mean with respect to each Bid-Option
Borrowing, the period commencing on the date of such Borrowing and ending on the
date elected by the Treasury Manager in the applicable Bid-Option Quote Request,
which date shall be not less than 15 days and not more than 180 days after the
date of such Bid-Option Loan; provided that:
(i) any such Interest Period that would otherwise
end on a day that is not a Business Day shall be extended to the next
succeeding Business day; and
(ii) no such Interest Period that would end after the
Termination Date shall be permitted.
"Bid-Option Loan" shall mean a Loan which is made by a Bank pursuant to
a Bid-Option Auction.
"Bid-Option Note" shall mean a promissory note of the Borrowers in
substantially the form of Exhibit A hereto evidencing the obligation of the
Borrowers to repay Bid-Option Loans, as amended or modified from time to time
and together with any promissory note or notes issued in exchange or replacement
therefor.
"Bid-Option Percentage" shall mean, with respect to any Bank, the
percentage of the aggregate outstanding principal amount of the Bid-Option Loans
of all the Banks represented by the outstanding principal amount of the
Bid-Option Loans of such Bank.
"Bid-Option Quote" shall mean an offer by a Bank to make a Bid-Option
Loan in accordance with Section 2.2(d).
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"Bid-Option Quote Request" shall have the meaning ascribed thereto in
Section 2.2(b).
"Bid-Option Rate" shall mean, with respect to any Bid-Option Loan, the
Bid-Option Rate, as defined in Section 2.2(d)(ii)(E), that is offered for such
Loan.
"▇▇▇▇" shall mean a ▇▇▇▇ of exchange as defined in the Australian Bills
of Exchange ▇▇▇ ▇▇▇▇, as amended, or any successor act or code, but shall not
include a check.
"Borrowing" shall mean the aggregation of Advances made to any
Borrower, or continuations and conversions of such Advances, made pursuant to
Article II on a single date and for a single Interest Period. A Borrowing may be
referred to for purposes of this Agreement by reference to the type of Loan
comprising the relating Borrowing, e.g., a "Floating Rate Borrowing" if such
Loans are Floating Rate Loans, an "Eurocurrency Rate Borrowing" if such Loans
are Eurocurrency Rate Loans or a "Bid-Option Borrowing" if such Loans are
Bid-Option Loans.
"Borrowing Subsidiary" shall mean any Subsidiary of the Company party
to this Agreement on the Effective Date and any other Subsidiary of the Company
upon request by the Company to the Agent for designation of such Subsidiary as a
"Borrowing Subsidiary" hereunder from time to time so long as (a) the Company
guarantees the obligations of such new Borrowing Subsidiary pursuant to the
terms of the Guaranty, (b) such new Borrowing Subsidiary delivers all corporate
or organizational documents and authorizing resolutions reasonably requested by
the Agent and (c) the Borrowers and such new Borrowing Subsidiary execute an
agreement in the form of Exhibit B attached hereto and all agreements and take
such other action reasonably requested by Agent.
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which (a) the Agent is not open to the public for carrying on
substantially all of its banking functions or (b) if such reference relates to
the date for payment or purchase of any amount or deposit denominated in any
currency other than Dollars, banks are not generally open to the public for
carrying on substantially all of their banking functions in London, England and
in the principal financial center of the country issuing such currency.
"Canadian Dollars" or "C$" shall mean the lawful currency of Canada.
"Capital Lease" of any person shall mean any lease which, in accordance
with generally accepted accounting principles, is capitalized on the books of
such person.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations thereunder.
"C/L/C" shall mean any commercial letter of credit issued by the Agent
hereunder.
"Commitment" shall mean, with respect to each Bank, its Revolving
Credit Commitment, and, as applicable, its Alternate Currency Commitment.
"Consolidated" or "consolidated" shall mean, when used with reference
to any financial term in this Agreement, the aggregate for the Company and its
consolidated Subsidiaries of the amounts signified by such term for all such
persons determined on a consolidated basis in accordance with generally accepted
accounting principles.
"Consolidated Interest Expense" means, for any period, all interest
payable by the Company and its Subsidiaries calculated on a consolidated basis
during such period.
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"Consolidated Net Income" of any person shall mean, for any period, the
net income (after deduction for income and other taxes of such person determined
by reference to income or profits of such person) for such period (but without
reduction for any net loss incurred for any fiscal year during such period), all
as determined in accordance with generally accepted accounting principles.
"Contingent Liabilities" of any person shall mean, as of any date, all
obligations of such person or of others for which such person is contingently
liable, as obligor, guarantor, surety or in any other capacity, or in respect of
which obligations such person assures a creditor against loss or agrees to take
any action to prevent any such loss (other than endorsements of negotiable
instruments for collection in the ordinary course of business), including
without limitation all reimbursement obligations of such person in respect of
any letters of credit, surety bonds or similar obligations and all obligations
of such person to advance funds to, or to purchase assets, property or services
from, any other person in order to maintain the financial condition of such
other person.
"Default" shall mean any of the events or conditions described in
Section 6.1 which might become an Event of Default with notice or lapse of time
or both.
"Designated Borrower" shall mean, in relation to any Advance, the
Borrower nominated by the Treasury Manager as the Designated Borrower in the
request for such Advance.
"Designation Date" is defined in Section 2.1(g).
"Dollar Equivalent" of an amount denominated in any currency other than
Dollars, as of any date of determination, shall mean the quotient of (i) such
amount divided by (ii) the number of units of such other currency (stated as a
decimal if less than 1.0) which could be purchased with one (1) Dollar at the
spot or other relevant rate of exchange quoted by the Agent at approximately
11:00 a.m. London time on such date, which rate of exchange shall be
substantially representative of the market rate.
"Dollars" and "$" shall mean the lawful money of the United States of
America.
"EBIT" shall mean, with respect to any person, for any period, the sum
of (a) operating net income or loss plus (b) all amounts deducted in determining
such operating net income or loss on account of (i) Interest Expense and (ii)
taxes based on or measured by income, all as determined in accordance with
generally accepted accounting principles, plus (c) the amount of any one-time
charge taken as a result of the cumulative effect from changes to generally
accepted accounting principles after the Effective Date.
"Effective Date" shall mean October 26, 2001.
"Eligible Currency" shall mean any currency other than Dollars that is
readily available, freely traded, in which deposits are customarily offered to
banks in the London interbank market, convertible into Dollars in the
international interbank market and as to which the Dollar Equivalent may be
readily calculated. If, after the designation by the Banks of any currency as a
Foreign Syndicated Currency or by the Alternate Currency Banks as an Alternate
Currency, currency control or other exchange regulations are imposed in the
country in which such currency is issued with the result that different types of
such currency are introduced, such country's currency is, in the determination
of the Agent, no longer readily available or freely traded or as to which, in
the determination of the Agent, a Dollar Equivalent is not readily calculable,
then the Agent shall promptly notify the Company, and such country's currency
shall no longer be a Foreign Currency until such time as the Agent agrees to
reinstate such country's currency as a Foreign Currency and promptly, but in any
event within five (5) Business Days of receipt of such notice from the Agent,
the Borrowers with respect to such Foreign Currency shall repay all Loans in
5
such affected currency or convert such Loans into Loans in Dollars or a Foreign
Currency, as applicable, subject to the other terms of this Agreement.
"Environmental Laws" at any date shall mean all provisions of law,
statute, ordinances, rules, regulations, judgments, writs, injunctions, decrees,
orders, awards and standards which are applicable to any Borrower or any
Subsidiary and promulgated by the government of the United States of America or
any foreign government or by any state, province, municipality or other
political subdivision thereof or therein or by any court, agency,
instrumentality, regulatory authority or commission of any of the foregoing
concerning the protection of, or regulating the discharge of substances into,
the environment.
"Equalized Share" is defined in Section 2.1(f).
"Equivalent" of an amount of one currency (the "first currency")
denominated in another currency (the "second currency"), as of any date of
determination, shall mean the amount of the second currency which could be
purchased with the amount of the first currency at the most favorable spot
exchange rate quoted by the Agent at approximately 11:00 a.m. local time of the
Applicable Lending Installation on such date, which rate shall be substantially
representative of the market rate.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations thereunder.
"ERISA Affiliate" shall mean, with respect to any person, any trade or
business (whether or not incorporated) which, together with such person or any
Subsidiary of such person, would be treated as a single employer under Section
414 of the Code.
"Euro" and/or "EUR" means the euro referred to in council Regulation
(EC) No. 1103/97 dated June 17, 1997 passed by the Council of the European Union
or, if different, the then lawful currency of the member states of the European
Union that participate in the third stage of Economic and Monetary Union.
"Eurocurrency Base Rate" applicable to any Eurocurrency Interest Period
means:
(a) in the case of any Eurocurrency Rate Loans denominated in Dollars
for the relevant Eurocurrency Interest Period, the rate per annum obtained by
dividing (i) the per annum rate of interest equal to the applicable British
Bankers' Association Interest Settlement Rate for deposits in the Dollars
appearing on Reuters Screen FRBD as of 11:00 a.m. (London time) two Business
Days prior to the first day of such Eurocurrency Interest Period, and having a
maturity equal to such Eurocurrency Interest Period, provided that, (x) if
Reuters Screen FRBD is not available to the Agent for any reason, the applicable
rate for the relevant Eurocurrency Interest Period shall instead be the
applicable British Bankers' Association Interest Settlement Rate for deposits in
the Dollars as reported by any other generally recognized financial information
service as of 11:00 a.m. (London time) two Business Days prior to the first day
of such Eurocurrency Interest Period, and having a maturity equal to such
Eurocurrency Interest Period, and (y) if no such British Bankers' Association
Interest Settlement Rate is available, the applicable rate for the relevant
Eurocurrency Interest Period shall instead be the rate determined by the Agent
to be the rate at which Bank One offers to place deposits in the Dollars with
first-class banks in the London interbank market at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Eurocurrency
Interest Period, in the approximate amount of Bank One's relevant Eurocurrency
Rate Loan and having a maturity equal to such Eurocurrency Interest Period, such
sum to be rounded up, if necessary, to the nearest whole multiple of one
one-hundredth of one percent (1/100 of 1%) by (ii) an amount equal to one minus
the stated maximum rate (expressed as a decimal) of all reserve requirements
including, without limitation, any marginal, emergency, supplemental, special or
other reserves, that is specified on the first day of such Eurocurrency Interest
Period by the Board of Governors of the Federal Reserve System (or any successor
6
agency thereto) for determining the maximum reserve requirement with respect to
eurocurrency funding (currently referred to as "Eurocurrency liabilities" in
Regulation D of such Board) maintained by a member bank of such System, such sum
to be rounded up, if necessary, to the nearest whole multiple of one
one-hundredth of one percent (1/100 of 1%), all as conclusively determined by
the Agent, absent manifest error;
(b) In the case of any Eurocurrency Rate Loans denominated in
any Foreign Syndicated Currency for the relevant Eurocurrency Interest Period,
the rate per annum obtained by dividing (i) the per annum rate of interest equal
to the applicable British Bankers' Association Interest Settlement Rate for
deposits in the applicable Foreign Syndicated Currency appearing on the
applicable Reuters Screen for such Foreign Syndicated Currency as of 11:00 a.m.
(London time) two Business Days prior to the first day of such Eurocurrency
Interest Period, and having a maturity equal to such Eurocurrency Interest
Period, provided that, (x) if the applicable Reuters Screen for such Foreign
Syndicated Currency is not available to the Agent for any reason, the applicable
rate for the relevant Eurocurrency Interest Period shall instead be the
applicable British Bankers' Association Interest Settlement Rate for deposits in
the applicable Foreign Syndicated Currency as reported by any other generally
recognized financial information service as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurocurrency Interest Period, and
having a maturity equal to such Eurocurrency Interest Period, and (y) if no such
British Bankers' Association Interest Settlement Rate is available, the
applicable rate for the relevant Eurocurrency Interest Period shall instead be
the rate determined by the Agent to be the rate at which Bank One offers to
place deposits in the applicable Foreign Syndicated Currency with first-class
banks in the London interbank market at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Eurocurrency Interest Period,
in the approximate amount of Bank One's relevant Eurocurrency Rate Loan and
having a maturity equal to such Eurocurrency Interest Period, such sum to be
rounded up, if necessary, to the nearest whole multiple of one one-hundredth of
one percent (1/100 of 1%), divided by (ii) an amount equal to one minus the
stated maximum rate (expressed as a decimal) of all reserve requirements
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) and other fees, charges and other requirements similar
thereto or the functional equivalent thereof which the Agent determines to be
market practice to take into account in determining the Eurocurrency Base Rate
that are specified on the first day of such Interest Period by the Board of
Governors of the Federal Reserve System (or any successor agency thereto) for
determining the maximum reserve requirement with respect to Eurocurrency funding
(currently referred to as "Eurocurrency liabilities" in Regulation D of such
Board) maintained by a member bank of such System or by any other governmental
entity, foreign or domestic, such sum to be rounded up, if necessary, to the
nearest whole multiple of one one-hundredth of one percent (1/100 of 1%), all as
conclusively determined by the Agent (absent manifest error); provided that with
respect to any Eurocurrency Rate Loans in any Foreign Syndicated Currency, an
alternative formula shall apply if (a) the Borrower and the Agent shall have
agreed to such alternative formula, (b) such formula is based on the rate
determined pursuant to clause (i) above and (c) the Agent shall have determined
that such alternative formula more accurately compensates the Banks for the cost
of maintaining reserves and similar requirements in respect of such Eurocurrency
Rate Loans.
"Eurocurrency Business Day" shall mean, with respect to any
Eurocurrency Rate Loan, a day which is both a Business Day and a day on which
dealings in Dollar deposits or the relevant Foreign Currency are carried out in
the relevant interbank market.
"Eurocurrency Interest Period" shall mean, with respect to any
Eurocurrency Rate Loan, the period commencing on the day such Eurocurrency Rate
Loan is made or converted to a Eurocurrency Rate Loan and ending on the date
one, two, three or six months thereafter or such other (longer or shorter)
period mutually agreed upon among the Agent, the Banks and the Company, as any
Borrower may elect under Section 2.6 or 2.9, provided, however, that (a) any
7
Eurocurrency Interest Period which commences on the last Eurocurrency Business
Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on the
last Eurocurrency Business Day of the appropriate subsequent calendar month, (b)
each Eurocurrency Interest Period which would otherwise end on a day which is
not a Eurocurrency Business Day shall end on the next succeeding Eurocurrency
Business Day or, if such next succeeding Eurocurrency Business Day falls in the
next succeeding calendar month, on the next preceding Eurocurrency Business Day,
and (c) no Eurocurrency Interest Period which would end after the Termination
Date shall be permitted.
"Eurocurrency Rate" means, with respect to any Eurocurrency Rate Loan
for any Eurocurrency Interest Period or portion thereof, the per annum rate that
is equal to the sum of (a) the Applicable Margin, plus (b) the Eurocurrency Base
Rate; which Eurocurrency Rate shall change simultaneously with any change in the
margin described in clause (a) above.
"Eurocurrency Rate Loan" means any Loan which bears interest at the
Eurocurrency Rate.
"Event of Default" shall mean any of the events or conditions described
in Section 6.1.
"Federal Funds Rate" shall mean the per annum rate that is equal to the
per annum rate established and announced by the Agent from time to time as the
opening federal funds rate paid or payable by the Agent in its regional federal
funds market for overnight borrowings from other banks; as conclusively
determined by the Agent, absent manifest error, such rate to be rounded up, if
necessary, to the nearest whole multiple of one one-hundredth of one percent
(1/100 of 1%), which Federal Funds Rate shall change simultaneously with any
change in such announced rates.
"Fixed Rate Loan" shall mean any Fixed Rate Revolving Credit Loan or
Bid-Option Loan.
"Fixed Rate Revolving Credit Loan" means any Eurocurrency Rate Loan.
"Floating Rate" shall mean the per annum rate equal to the greater of
(i) the Prime Rate in effect from time to time, or (ii) the sum of one-half of
one percent (1/2 of 1%) per annum plus the Federal Funds Rate in effect from
time to time; which Floating Rate shall change simultaneously with any change in
such Prime Rate or Federal Funds Rate, as the case may be.
"Floating Rate Loan" shall mean any Revolving Credit Loan which bears
interest at the Floating Rate.
"Foreign Currency" shall mean any Foreign Syndicated Currency or
Alternate Currency.
"Foreign Subsidiary" shall mean any Subsidiary of the Company that is
not a Domestic Subsidiary.
"Foreign Syndicated Currency" shall mean any currency which is an
Eligible Currency and approved by the Banks; provided, that, subject to the
terms of this Agreement (including without limitation Section 3.7), Pounds
Sterling and Euro shall be deemed approved by the Banks and shall be deemed to
be Foreign Syndicated Currencies unless designated by the Company as an
Alternate Currency, in which case such currency shall be an Alternate Currency
if agreed to by all Alternate Currency Banks lending such alternate Currency and
the Agent.
"generally accepted accounting principles" shall mean generally
accepted accounting principles in effect from time to time and applied on a
basis consistent with that reflected in the financial statements referred to in
Section 4.6, unless otherwise provided herein.
8
"Guaranty" shall mean the guaranty entered into by the Company for the
benefit of the Agent and the Banks pursuant to this Agreement in the form of
Exhibit C hereto, as amended or modified from time to time.
"Indebtedness" shall mean (i) indebtedness for borrowed money, (ii)
obligations evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations to pay the deferred purchase price of property or services,
except for trade accounts payable arising in the ordinary course of business
that are not more than 90 days past due or as are reasonably being contested,
(iv) obligations as lessee under leases which have been in accordance with
generally accepted accounting principles, recorded as Capital Leases, (v)
obligations to purchase property or services if payment is required regardless
of whether such property is delivered or services are performed (generally
called "take or pay" contracts), but such obligations shall only be included in
an amount equal to the difference between the amount of the required payment and
the value to the Company or a Subsidiary of the Company of the goods or services
required to be delivered in connection with such required payment, (vi)
obligations in respect of currency or interest rate swaps or comparable
transactions valued at the maximum termination payment payable by the obligor,
other than any such contracts entered into as ▇▇▇▇▇▇ against Indebtedness of the
kinds referred to in clauses (i) and (ii) above; provided, that, for purposes of
Section 6.1(f) only, such contracts shall be included in "Indebtedness", (vii)
any obligation of any Person other than the Company or its Subsidiaries, if such
obligation is secured by any lien on the property of the Company or any of its
Subsidiaries, provided that, the amount of any such Indebtedness shall be
limited to the greater of the then book value or fair market value of the
property securing any such lien, (viii) liabilities in respect of unfunded
vested benefits under plans covered by Title IV of ERISA, (ix) Off-Balance Sheet
Liabilities, and (x) Contingent Liabilities with respect to any of the
foregoing.
"Interest Coverage Ratio" shall mean, as of any date, the ratio of (a)
Consolidated EBIT as calculated for the four most recently ended consecutive
fiscal quarters of the Company to (b) Consolidated Interest Expense as
calculated for the same four fiscal quarters.
"Interest Payment Date" shall mean (a) with respect to any Eurocurrency
Rate Loan or Bid-Option Loan, the last day of each Interest Period with respect
to such Eurocurrency Rate Loan or Bid-Option Loan and, in the case of any
Interest Period exceeding three months, those days that occur during such
Interest Period at intervals of three months after the first day of such
Interest Period, (b) with respect to any Alternate Currency Loan, the date
specified as the date on which interest is payable in the applicable Alternate
Currency Addendum, (c) with respect to any Swing Loan, the date specified as the
date on which interest is payable in Section 2.1(b), and (d) in all other cases,
within five (5) days of receipt of an invoice containing a computation of
interest due, which invoice shall be prepared as of the last Business Day of
each March, June, September and December occurring after the date hereof,
commencing with the first such Business Day occurring after the date of this
Agreement.
"Interest Period" shall mean any Eurocurrency Interest Period or
Bid-Option Interest Period.
"Invitation for Bid-Option Quotes" shall mean an invitation for
Bid-Option Quotes in the form referred to in Section 2.2(c).
"Investments" shall mean all investments, in cash or by delivery of
property, made, directly or indirectly, in any Person, whether by acquisition of
shares of Capital Stock, indebtedness or other obligations or securities or by
loan, advance, capital contribution or otherwise; provided, however, that
"Investments" shall not mean or include routine investments in property to be
used or consumed in the ordinary course of business.
9
"Letter of Credit" shall mean an S/L/C or C/L/C issued by the Agent on
behalf of the Banks for the account of any Borrower under an application and
related documentation acceptable to the Agent requiring, among other things,
immediate reimbursement by such Borrower to the Agent in respect of all drafts
or other demand for payment honored thereunder and all expenses paid or incurred
by the Agent relative thereto. Each letter of credit issued and outstanding
under the 1997 Loan Agreement shall be deemed outstanding hereunder and a Letter
of Credit for all purposes of this Agreement and the other Loan Documents.
"Letter of Credit Advance" shall mean any issuance of a Letter of
Credit under Section 2.6 made pursuant to Section 2.1 in which each Bank
acquires a pro rata risk participation (based on such Bank's Revolving Credit
Commitment) pursuant to Section 2.6(e).
"Lien" shall mean any pledge, assignment, deed of trust, hypothecation,
mortgage, security interest, conditional sale or title retaining contract,
financing statement filing, or any other type of lien, charge, encumbrance or
other similar claim or right.
"Loan" shall mean any Revolving Credit Loan, any Alternate Currency
Loan, any Swing Loan or any Bid-Option Loan, as the context may require.
"Loan Documents" shall mean this Agreement, the Notes, the Letter of
Credit Documents, the Guaranty, the Alternate Currency Addendums and any other
agreement, instrument or document executed at any time in connection with this
Agreement.
"Margin Stock" shall mean Margin Stock within the meaning of Regulation
U of the Board of Governors of the Federal Reserve System.
"Material Adverse Effect" means a material adverse effect on (i) the
business, property, condition (financial or otherwise) or results of operations
of the Company and its Subsidiaries taken as a whole, or (ii) the validity or
enforceability of any of the Loan Documents or the rights or remedies of the
Agent or the Banks thereunder.
"Multiemployer Plan" shall mean any "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA or Section 414(f) of the Code.
"National Currency Unit" means the unit of currency (other than a Euro
unit) of each member state of the European Union that participates in the third
stage of Economic and Monetary Union.
"Net Worth" of any person shall mean, as of any date, the amount of
stockholders' equity, exclusive of the cumulative effect of Other Comprehensive
Earnings (either positive or negative) and exclusive of any changes to Net Worth
as a result of the cumulative effect from changes to generally accepted
accounting principles after the Effective Date, all on a consolidated basis and
in accordance with generally accepted accounting principles.
"1997 Loan Agreement" shall mean the loan agreement dated as of
November 18, 1997, among the Company, the other borrowers named therein, the
banks party thereto and Bank One, Michigan, as agent, as amended or modified
from time to time.
"Notes" shall mean the Revolving Credit Notes, the Bid-Option Notes and
the Swing Line Note; "Note" shall mean any Revolving Credit Note, any Bid-Option
Note or any Swing Line Note.
"Notice of Bid-Option Loan" shall have the meaning set forth in Section
2.2(f).
10
"Off-Balance Sheet Liability" of a person means (i) any repurchase
obligation or liability of such person with respect to accounts or notes
receivable sold by such person, (ii) any liability under any sale and leaseback
transaction which is not a Capital Lease, (iii) any liability under any
so-called "synthetic lease" transaction entered into by such person, or (iv) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such person, but excluding from this clause
(iv) Operating Leases.
"Operating Lease" of a person means any lease of property (other than a
Capital Lease) by such person as lessee which has an original term (including
any required renewals and any renewals effective at the option of the lessor) of
one year or more.
"Other Comprehensive Earnings (Loss)" shall mean the reported increases
or decreases in the Company's reported Net Worth resulting from (a) foreign
currency translation adjustments, (b) unrealized gains (losses) on available
securities held for sale, and (c) the cumulative effect of the Company's
adoption of FAS 133.
"Overdue Rate" shall mean (a) in respect of principal of Floating Rate
Loans, a rate per annum that is equal to the sum of two percent (2%) per annum
plus the Floating Rate, (b) in respect of principal of Fixed Rate Loans, a rate
per annum that is equal to the sum of two percent (2%) per annum plus the per
annum rate in effect thereon until the end of the then current Interest Period
for such Loan and, thereafter, a rate per annum that is equal to the sum of two
percent (2%) per annum plus, with respect to Loans denominated in Dollars, the
Floating Rate and, with respect to Loans denominated in any other Permitted
Currency, the relevant interbank rate for such Permitted Currency plus the
Applicable Margin, and (c) in respect of other amounts payable by any Borrower
hereunder (other than interest), a per annum rate that is equal to the sum of
two percent (2%) per annum plus the Floating Rate or, with respect to any
Alternate Currency Loan, such other overdue rate, if any, as specified in the
applicable Alternate Currency Addundum.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Permitted Currency" shall mean any Alternate Currency and any
Syndicated Currency.
"Permitted Liens" shall mean Liens permitted by Section 5.2(d) hereof.
"Permitted Securitization Transaction" is defined in Section 5.2(f).
"Person" or "person" shall include an individual, a corporation, a
limited liability company, an association, a partnership, a trust or estate, a
joint stock company, an unincorporated organization, a joint venture, a trade or
business (whether or not incorporated), a government (foreign or domestic) and
any agency or political subdivision thereof, or any other entity.
"Plan" shall mean, with respect to any person, any pension plan (other
than a Multiemployer Plan) subject to Title IV of ERISA or to the minimum
funding standards of Section 412 of the Code which has been established or
maintained by such person, any Subsidiary of such person or any ERISA Affiliate,
or by any other person if such person, any Subsidiary of such person or any
ERISA Affiliate could have liability with respect to such pension plan.
"Pounds Sterling" or "Pounds" shall mean the lawful currency of the
United Kingdom.
11
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Prime Rate" shall mean the per annum rate announced or established by
the Agent from time to time as its "prime rate" (it being acknowledged that such
announced rate may not necessarily be the lowest rate charged by the Agent to
any of its customers), which Prime Rate shall change simultaneously with any
change in such announced or established rates.
"Prohibited Transaction" shall mean any non-exempt transaction
involving any Plan which is proscribed by Section 406 of ERISA or Section 4975
of the Code.
"Pro Rata Share" shall mean, with respect to any Bank, the percentage
obtained by dividing (a) such Bank's Revolving Credit Commitment at such time
(in each case, as adjusted from time to time in accordance with the provisions
of this Agreement) by (b) the aggregate amount of all of the Revolving Credit
Commitments at such time; provided however, if all of the Revolving Credit
Commitments are terminated pursuant to the terms of this Agreement, then "Pro
Rata Share" means the percentage obtained by dividing (x) the sum of such Bank's
Revolving Credit Commitment immediately prior to such termination by (y) the
aggregate amount of all Revolving Credit Commitments immediately prior to such
termination.
"Reportable Event" shall mean a reportable event as described in
Section 4043(b) of ERISA including those events as to which the thirty (30) day
notice period is waived under Part 2615 of the regulations promulgated by the
PBGC under ERISA.
"Request for a New Alternate Currency Facility" is defined in Section
2.1(d).
"Required Banks" shall mean Banks in the aggregate having at least 51%
of the aggregate Revolving Credit Commitments or, if the Revolving Credit
Commitments have been terminated, Banks in the aggregate holding at least 51% of
the aggregate unpaid principal amount of the outstanding Advances.
"Restricted Margin Stock" means Margin Stock owned by the Company or
any of its Subsidiaries which represents not more than 25% of the aggregate
value (determined in accordance with Regulation U), on a consolidated basis, of
the property and assets of the Company and its Subsidiaries (other than any
Margin Stock) that is subject to the provisions of Section 5.2(d).
"Revolving Credit Advance" shall mean any Revolving Credit Loan, any
Letter of Credit Advance and any Swing Loan.
"Revolving Credit Commitment" shall mean, with respect to each Bank,
the commitment of each such Bank to make Revolving Credit Loans and to
participate in Letter of Credit Advances made through the Agent pursuant to
Section 2.1(a), in amounts not exceeding in aggregate principal amount
outstanding at any time the respective revolving credit commitment amount for
each such Bank set forth opposite the name of each such Bank in Schedule 1.1
under the heading "Revolving Credit Commitments", or, as to any Bank becoming a
party hereto after the Effective Date as set forth in the applicable Assignment
and Acceptance, as such amounts may be reduced from time to time pursuant to
Section 2.4 or modified pursuant to Section 2.4 or 8.6.
"Revolving Credit Loan" shall mean any Borrowing under Section 2.6 and
made pursuant to Section 2.1(a).
"Revolving Credit Note" shall mean any promissory note of the Borrowers
evidencing the Revolving Credit Loans in substantially the form annexed hereto
as Exhibit D, as amended or modified from time to time and together with any
12
promissory note or notes issued in exchange or replacement therefor.
"Securitization Entity" means a wholly-owned Subsidiary of the Company
that engages in no activities other than Permitted Securitization Transactions
and any necessary related activities and owns no assets other than as required
or permitted for Permitted Securitization Transactions and (i) no portion of the
Indebtedness (contingent or otherwise) of which is guaranteed by the Company or
any Subsidiary of the Company or is recourse to or obligates the Company or any
Subsidiary of the Company in any way, other than pursuant to customary
representations, warranties, covenants, indemnities and other obligations
entered into in connection with a Permitted Securitization Transaction, and (ii)
to which neither the Company nor any Subsidiary of the Company has any material
obligation to maintain or preserve such entity's financial condition or cause
such entity to achieve certain levels of operating results.
"Senior Unsecured Notes" means the 7.45% Senior Notes of the Company,
due February 1, 2003, issued in an aggregate original principal amount of
$25,000,000, under that certain Note Agreement, dated as of February 1, 1993,
between the Company and the Purchasers named therein, the 6.60% Senior Notes of
the Company, due February 27, 2005, issued in an aggregate original principal
amount of $20,000,000, under that certain Note Agreement dated as of February
27, 1995 between the Company and the Purchasers named therein, and the 6.71%
Senior Notes due February 27, 2008, issued in an aggregate original principal
amount of $80,000,000 under that certain Note Agreement dated as of February 27,
1998 between the Company and the Purchasers named therein.
"Significant Subsidiary" means (i) any Subsidiary which is a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X under the
Securities and Exchange Act of 1934 if 5% were substituted for 10% wherever it
occurs in such Rule, and (ii) any Subsidiary which is responsible for more than
5% of consolidated net sales of the Company and its Subsidiaries as reflected in
the most recent financial statements of the Company delivered pursuant to
Section 5.1(d).
"S/L/C" shall mean any standby letter of credit issued by the Agent
hereunder.
"Subsidiary" of any person shall mean any other person (whether now
existing or hereafter organized or acquired) in which (other than directors'
qualifying shares required by law) at least a majority of the securities or
other ownership interests of each class having ordinary voting power or
analogous right (other than securities or other ownership interests which have
such power or right only by reason of the happening of a contingency), at the
time as of which any determination is being made, are owned, beneficially and of
record, by such person or by one or more of the other Subsidiaries of such
person or by any combination thereof. Unless otherwise specified, reference to
"Subsidiary" shall mean a Subsidiary of the Company.
"Subordinated Debt" of any person shall mean, as of any date, that
Indebtedness of such person for borrowed money which is expressly subordinate
and junior in the right of payment to the Advances of such person to the Banks
in manner and by agreement satisfactory in form and substance to the Required
Banks, which consent and agreement may not be unreasonably withheld.
"Swing Line Facility" shall have mean the swing line facility
established pursuant to Section 2.3.
"Swing Loan" is defined in Section 2.3.
13
"Swing Line Note" means the promissory note of the Company payable to
the order of the Agent, in substantially the form annexed hereto as Exhibit E,
as amended or modified from time to time and together with any promissory note
or notes issued in exchange or replacement therefor.
"Syndicated Currency" shall mean Dollars and any Foreign Syndicated
Currency.
"Termination Date" shall mean the earlier to occur of (a) October 17,
2006, and (b) the date on which the Commitments shall be terminated pursuant to
Section 2.4 or 6.2.
"364-Day Credit Agreement" means the 364-Day Credit Agreement dated the
date hereof among the Borrowers, the Banks and the Agent, as amended, modified,
replaced or refinanced from time to time.
"Total Debt" as of any date for any person, shall mean: (a) all debt
for borrowed money and similar monetary obligations evidenced by bonds, notes,
debentures, Capitalized Lease obligations or otherwise; (b) all liabilities
secured by any Lien existing on property owned or acquired subject thereto,
whether or not the liability secured thereby shall have been assumed; (c) all
reimbursements obligations under outstanding letters of credit in respect of
drafts which (i) may be presented or (ii) have been presented and have not yet
been paid, (d) the aggregate outstanding amount of all Permitted Securitization
Transactions, based on the aggregate outstanding amount sold, assigned,
discounted or otherwise transferred or financed, whether or not shown as a
liability on a consolidated balance sheet of such person, as reasonably
satisfactory to the Agent, and (e) all Contingent Liabilities relating to any of
the obligations of others similar in character to those described in the
foregoing clauses (a) through (d).
"Treasury Manager" includes any Affiliate of the Company appointed in
writing by the Company and the Borrowers as Treasury Manager under this
Agreement in the place of the person named above, and which is accepted by the
Agent for that purpose.
"Unfunded Benefit Liabilities" shall mean, with respect to any Plan as
of any date, the amount of the unfunded benefit liabilities determined in
accordance with Section 4001(a)(18) of ERISA.
"Unrestricted Margin Stock" means any Margin Stock owned by the Company
or any of its Subsidiaries which is not Restricted Margin Stock.
1.2 Other Definitions; Rules of Construction. As used herein, the terms
"Agent", "Banks", "Company", "Borrowing Subsidiary", "Borrowing Subsidiaries"
and "this Agreement" shall have the respective meanings ascribed thereto in the
introductory paragraph of this Agreement. Such terms, together with the other
terms defined in Section 1.1, shall include both the singular and the plural
forms thereof and shall be construed accordingly. All computations required
hereunder and all financial terms used herein shall be made or construed in
accordance with generally accepted accounting principles unless such principles
are inconsistent with the express requirements of this Agreement. Use of the
terms "herein", "hereof", and "hereunder" shall be deemed references to this
Agreement in its entirety and not to the Section or clause in which such term
appears. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided.
ARTICLE II
THE COMMITMENTS AND THE ADVANCES
2.1 Commitments of the Banks.
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(a) Each Bank agrees, for itself only, subject to the terms
and conditions of this Agreement, to make Revolving Credit Loans denominated in
any Syndicated Currency to the Borrowers pursuant to Section 2.6 and Section 3.3
and to participate in Letter of Credit Advances denominated in any Syndicated
Currency to the Borrowers pursuant to Section 2.6, from time to time from and
including the Effective Date to but excluding the Termination Date, not to
exceed in aggregate principal amount at any time outstanding the amount of its
respective Revolving Credit Commitment as of the date any such Advance is made;
provided, however, that (i) the Dollar Equivalent of the aggregate principal
amount of Letter of Credit Advances outstanding at any time shall not exceed
$25,000,000, (ii) the Dollar Equivalent of all Alternate Currency Loans
outstanding at any time shall not exceed $50,000,000, (iii) the Dollar
Equivalent of all Revolving Credit Advances, all Swing Loans and all Alternate
Currency Loans outstanding at any time shall not exceed the aggregate Revolving
Credit Commitments, (iv) the Dollar Equivalent of all Revolving Credit Advances
and all Swing Loans outstanding at any time shall not exceed the aggregate
Activated Revolving Credit Commitments, and (v) the Dollar Equivalent of all
Alternate Currency Loans outstanding at any time shall not exceed the aggregate
Activated Alternate Currency Commitments.
(b) Subject to the terms and conditions of this Agreement and
the applicable Alternate Currency Addendum, from and including the later of the
date of this Agreement and the date of execution of the applicable Alternate
Currency Addendum and prior to the Termination Date (unless an earlier
termination date shall be specified in the applicable Alternate Currency
Addendum), the Agent and the applicable Alternate Currency Banks agree, on the
terms and conditions set forth in this Agreement and in the applicable Alternate
Currency Addendum, to make Alternate Currency Loans under such Alternate
Currency Addendum to the applicable Borrower party to such Alternate Currency
Addendum from time to time in the applicable Alternate Currency, in an amount
not to exceed each such Alternate Currency Bank's applicable Alternate Currency
Commitment; provided, however, (i) at no time shall the Dollar Equivalent of the
outstanding principal amount of all Alternate Currency Loans exceed the least of
(A) $50,000,000, (B) the aggregate Activated Alternate Currency Commitments or
(C) the aggregate amount that would be permitted by the proviso to Section
2.1(a), and (ii) at no time shall the Dollar Equivalent of the Alternate
Currency Loans for any specific Alternate Currency exceed the maximum amount
specified as the maximum amount for such Alternate Currency in the applicable
Alternate Currency Addendum. Each Alternate Currency Loan shall consist of
Alternate Currency Loans made by each applicable Alternate Currency Bank ratably
in proportion to such Alternate Currency Bank's respective Alternate Currency
Share. Subject to the terms of this Agreement and the applicable Alternate
Currency Addendum, the Borrowers may borrow, repay and reborrow Alternate
Currency Loans at any time prior to the Termination Date. On the Termination
Date, the outstanding principal balance of the Alternate Currency Loans shall be
paid in full by the applicable Borrower and prior to the Termination Date
prepayments of the Alternate Currency Loans shall be made by the applicable
Borrower if and to the extent required by this Agreement.
(c) If and to the extent any Alternate Currency Bank shall not
make its pro rata portion of any Alternate Currency Loan available to the Agent,
the Agent may (but shall not be obligated to) make such amount available to the
relevant Borrower, and such Alternate Currency Bank agrees to pay to the Agent
forthwith on demand such amount together with interest thereon, for each day
from the date such amount is made available to such Borrower by the Agent until
the date such amount is repaid to the Agent, at a rate per annum equal to the
Agent's cost of funds for such day for the first three days and, thereafter, the
interest rate applicable to the relevant Loan. If for any reason any applicable
Alternate Currency Bank fails to fund its Alternate Currency Share of any
Alternate Currency Loan at the time required under this Agreement and the
applicable Alternate Currency Addendum (the amount of such unfunded Alternate
Currency Share being hereinafter referred to as the "Unfunded Amount"), the
Agent shall be entitled to receive, retain and apply against such Unfunded
15
Amount the principal and interest otherwise payable to such Alternate Currency
Bank under this Agreement until the Agent receives such Unfunded Amount from
such Alternate Currency Bank or such Unfunded Amount is otherwise fully
satisfied. In addition to the foregoing, if for any reason any Alternate
Currency Bank fails to fund its Alternate Currency Share of any Alternate
Currency Loan at the time required under this Agreement and the applicable
Alternate Currency Addendum, such Alternate Currency Bank shall be deemed, at
the option of the Agent, to have unconditionally and irrevocably purchased from
the Agent, without recourse or warranty, an undivided interest in and
participation in the applicable Alternate Currency Loan in the amount of such
Alternate Currency Bank's Alternate Currency Share thereof under this Agreement
and the applicable Alternate Currency Addendum, and such interest and such
participation may be recovered from such Alternate Currency Bank together with
interest thereon at a rate per annum equal to the Agent's cost of funds for such
day for the first three days and, thereafter, the interest rate applicable to
the relevant Loan during the period commencing on the date of demand by the
Agent and ending on the date such funding shortfall is fully satisfied.
(d) The Company may, by written notice to the Agent request
the establishment of additional Alternate Currency Commitments in additional
Alternate Currencies (other than Syndicated Currencies) provided the Dollar
Equivalent of the aggregate amount of all of the Alternate Currency Loans does
not exceed $50,000,000 ("Request for a New Alternate Currency Facility"). The
Agent will promptly forward to the Banks any Request for a New Alternate
Currency Facility received from the Company; provided each Bank shall be deemed
not to have agreed to provide an Alternate Currency Commitment unless its
written consent thereto has been received by the Agent within ten (10) Business
Days from the date of such notification by the Agent to such Bank. In the event
that sufficient Banks consent to provide such Alternate Currency Commitment
pursuant to such Request for a New Alternate Currency Facility, upon execution
of the applicable Alternate Currency Addendum and the other documents,
instruments and agreements required pursuant to this Agreement and such
Alternate Currency Addendum, the Alternate Currency Loans with respect thereto
may be made. Unless a Bank is providing an Alternate Currency Commitment with
respect to any Alternate Currency Facility, consent of the Banks or Required
Bank shall not be required to establish an Alternate Currency Facility.
(e) Except as otherwise required by applicable law, in no
event shall the Agent or Alternate Currency Banks have the right to accelerate
the Alternate Currency Loans outstanding under any Alternate Currency Addendum
or to terminate their Alternate Currency Commitments (if any) thereunder to make
Alternate Currency Loans prior to the stated termination date in respect
thereof, except that (i) such Agent and Alternate Currency Banks shall, in each
case, have such rights upon an acceleration of the Loans and a termination of
the Revolving Credit Commitments pursuant to Section 6.2, and (ii) an Alternate
Currency Bank may terminate its Alternate Currency Commitment provided that such
Alternate Currency Bank shall provide sixty (60) days prior written notice of
such termination to the Agent and the Company. On the effective date of such
termination, all Alternate Currency Loans owing to such Alternate Currency Bank
shall be paid in full.
(f) Upon the occurrence of an Event of Default under Section
6.1(a) or 6.1(i), each Bank shall be deemed to have purchased, without recourse
or warranty, participation interests in the other Bank's Advances (other than
Bid-Option Loans) and/or take such other reasonable actions and make such other
equitable adjustments among the Banks as reasonably agreed to by the Banks, to
ensure that each Bank holds a portion (its "Equalized Share") of the aggregate
Advances (excluding any outstanding Bid-Option Loans) determined based on such
Bank's Pro Rata Share (determined based on its Revolving Credit Commitment), it
being the intent of the Banks that following such participations, equalization
payments and other actions in connection therewith, each Bank shall hold,
whether through participation or directly, a share of the aggregate Advances
(other than Bid-Option Loans) equal to its Equalized Share. The Banks and the
Agent agree to promptly execute any further documents and make such payments, if
any, among themselves to accomplish such equalization.
16
(g) The Company may, effective as of the Effective Date and
each corresponding date of each successive month thereafter (a "Designation
Date"), designate a portion of the Revolving Credit Commitments and the
Alternate Currency Commitments as activated or de-activated (the amount of the
Revolving Credit Commitments designated as activated by the Company is defined
herein as the "Activated Revolving Credit Commitments" and the amount of the
Alternate Currency Commitments designated as activated by the Company is defined
herein as the "Activated Alternate Currency Commitments"), provided that (A)
such activation or de-activation shall be in increments of $10,000,000, (B) the
Activated Alternate Currency Commitments may not exceed $50,000,000, and the
aggregate amount of the Activated Revolving Credit Commitments plus the
Activated Alternate Currency Commitments shall equal the Revolving Credit
Commitments, and (C) the Company gives written notification to the Agent of such
designation at least five Business Days prior to such Designation Date. As an
example, the aggregate amount of the Revolving Credit Commitments shall be
reduced, on a dollar for dollar basis, by the amount of any Activated Alternate
Currency Commitment and such reduced Revolving Credit Commitment shall be
referred to as the Activated Revolving Credit Commitment. If any such Activated
Alternate Currency Commitment is later deactivated pursuant to this Section
2.1(g), the Activated Revolving Credit Commitments would be increased, on a
dollar for dollar basis, by the amount of the Alternate Currency Commitment
which is being deactivated.
(h) Effect on Commitments. Notwithstanding anything in this
Agreement to the contrary, the sum of the aggregate outstanding principal amount
of all Revolving Credit Loans plus, all Letter of Credit Advances (being the
maximum amount available to be drawn under the related Letters of Credit plus
the amount of any draws under Letters of Credit that have not been reimbursed)
plus, all Alternate Currency Loans, plus all Bid-Option Loans plus, all Swing
Loans shall not at any time exceed the aggregate amount of the Revolving Credit
Commitments of all Banks. Each Bank's obligation to make its pro rata portion of
any subsequently requested Revolving Credit Loan or Letter of Credit Advance
shall not be affected by the making by such Bank of a Bid-Option Loan or an
Alternate Currency Loan, and the Bank which has outstanding Bid-Option Loans
and/or Alternate Currency Loans may be obligated to exceed its Revolving Credit
Commitment, and provided, that, as stated above, the aggregate principal amount
of all Revolving Credit Loans, all Letters of Credit Advances, all Alternate
Currency Loans, all Swing Loans and all Bid-Option Loans shall not at any time
exceed the aggregate amount of the Revolving Credit Commitments of all Banks.
(i) Effective Date. This Agreement and the Commitments
hereunder shall be effective, subject to Section 2.7, as of the Effective Date,
provided, that, the Borrowers may give notice of a request for an Advance as of
October 17, 2001 for purposes of satisfying the notice requirements for requests
for Advances and Section 3.8 shall be effective as of October 17, 2001.
2.2 Bid-Option Loans.
(a) The Bid-Option. From the Effective Date to but excluding
the Termination Date, the Treasury Manager may, as set forth in this Section
2.2, request the Banks to make offers to make Bid-Option Loans to a Designated
Borrower. Each Bank may, but shall have no obligation to, make such offers and
such Designated Borrower may, but shall have no obligation to, accept any such
offers, in the manner set forth in this Section 2.2; furthermore, each Bank may
limit the aggregate amount of Bid-Option Loans when quoting rates for more than
one Bid-Option Interest Period in any Bid-Option Quote, provided that such
limitation shall not be less than the minimum amounts required hereunder for
Bid-Option Loans and the Designated Borrower may choose among the Bid-Option
Loans if such limitation is imposed; provided, that the aggregate outstanding
principal amount of Bid-Option Loans shall not at any time exceed the lower of
(i) the excess of (A) the aggregate amount of the Commitments over (B) the sum
of the aggregate outstanding principal amount of Revolving Credit Advances or
(ii) $100,000,000;
17
(b) Bid-Option Quote Request. When the Treasury Manager wishes
to request offers to make Bid-Option Loans under this Section 2.2, it shall
transmit to the Agent by telex or telecopy a Bid-Option Quote Request
substantially in the form of Exhibit F hereto so as to be received no later than
11:00 a.m. Detroit time on the Business Day next preceding the date of the Loan
proposed therein specifying:
(i) the proposed date of the Bid-Option Loan,
which shall be a Business Day;
(ii) the Designated Borrower;
(iii) the aggregate amount of such Bid-Option
Loan, which shall be a minimum of $5,000,000 or a larger multiple of
$1,000,000; and
(iv) the duration of the Interest Period
applicable thereto, subject to the provisions of the definition of Interest
Period.
A Borrower may request offers to make Bid-Option Loans for more than one
Bid-Option Interest Period in a single Bid-Option Quote Request.
(c) Invitation for Bid-Option Quotes. Promptly upon receipt of
a Bid-Option Quote Request, the Agent shall send to the Banks by telecopy (or
telephone promptly confirmed by telecopy) an Invitation for Bid-Option Quotes
substantially in the form of Exhibit G hereto, which shall constitute an
invitation by the Treasury Manager and the Designated Borrower to each Bank to
submit Bid-Option Quotes offering to make the Bid-Option Loans to which such
Bid-Option Quote Request relates in accordance with this Section 2.2.
(d) Submission and Contents of Bid-Option Quotes.
(i) Each Bank may submit a Bid-Option Quote
containing an offer or offers to make Bid-Option Loans in response to any
Invitation for Bid-Option Quotes. Each Bid-Option Quote must comply with the
requirements of this subsection (d) and must be submitted to the Agent by
telecopy (or by telephone promptly confirmed by telecopy) at its office referred
to in Section 8.2 not later than 10:00 a.m. Detroit time on the proposed date of
the Borrowing; provided that Bid-Option Quotes submitted by the Agent (or any
Affiliate of the Agent) in the capacity of a Bank may be submitted, and may only
be submitted, if the Agent or such Affiliate notifies the Borrower of the terms
of the offer or offers contained therein not later than 9:45 a.m. Detroit time
on the proposed date of such Borrowing. Subject to Article VI, any Bid-Option
Quote so made shall be irrevocable except with the written consent of the Agent
given on the instructions of the Treasury Manager.
(ii) Each Bid-Option Quote shall be in
substantially the form of Exhibit H hereto, but may be submitted to the Agent
by telephone with prompt confirmation by delivery to the Agent of such written
Bid-Option Quote, and shall in any case specify:
(A) the proposed date of the Borrowing;
(B) the principal amount of the
Bid-Option Loan for which each such offer is being made, which principal amount
(x) must be in a minimum of $5,000,000 or a larger multiple of $1,000,000, and
(y) may not exceed the principal amount of the Bid-Option Loans for which offers
were requested;
18
(C) the Interest Period(s) for which
each such Bid-Option Rate is offered;
(D) the rate of interest per annum
(rounded to the nearest 1/100 of 1%)(the "Bid-Option Rate") offered for each
such Bid-Option Loan;
(E) the identity of the quoting Bank.
(iii) Any Bid-Option Quote shall be disregarded
if it:
(A) is not substantially in the form
of Exhibit H hereto (or is not submitted by telephone to the Agent with
prompt written confirmation to follow)or does not specify all of the information
required by clause (ii) of this
subsection (d);
(B) contains qualifying, conditional or
similar language;
(C) proposes terms other than or in
addition to those set forth in the applicable Invitation for Bid-Option Quotes;
or
(D) arrives after the time set forth in
Section 2.2(d)(i);
provided that a Bid-Option Quote shall not be disregarded pursuant to clause (B)
or (C) above solely because it contains an indication that an allocation that
might otherwise be made to it pursuant to Section 2.2(g) would be unacceptable.
The Agent shall notify the Treasury Manager of any disregarded Bid-Option Quote.
(e) Notice to Borrower. The Agent shall promptly notify the
Treasury Manager of the terms of any Bid-Option Quote submitted by a Bank that
is in accordance with Section 2.2(d). Any Bid-Option Quote not made in
accordance with Section 2.2(d) shall be disregarded by the Agent. The Agent's
notice to the Treasury Manager shall specify (i) the aggregate principal amount
of Bid-Option Loans for which offers have been received for each Bid-Option
Interest Period specified in the related Bid-Option Quote Request, and (ii) the
respective principal amounts and respective Bid-Option Rates so offered.
(f) Acceptance and Notice by Borrower. Not later than 11:00
a.m. Detroit time on the proposed date of a Borrowing, the Treasury Manager
shall notify the Agent of the Designated Borrower's acceptance or non-acceptance
of the offers so notified to it pursuant to subsection (e) of this Section and
the Agent shall, promptly upon receiving such notice from the Treasury Manager,
notify each Bank whose Bid-Option Quote has been accepted. In the case of
acceptance, such notice (a "Notice of Bid-Option Loan") shall specify the
aggregate principal amount of offers for the applicable Interest Period(s) that
have been accepted. The Borrower may accept any Bid-Option Quote in whole or in
part; provided that:
(i) the aggregate principal amount of each
Bid-Option Loan may not exceed the applicable amount set forth in the related
Bid-Option Quote Request for the applicable Bid-Option Interest Period;
(ii) the principal amount of each Bid-Option
Loan must be $5,000,000 or a larger multiple of $1,000,000;
19
(iii) acceptance of offers may only be made on
the basis of ascending Bid-Option Rates; and
(iv) the Borrower may not accept any offer that
is described in Section 2.2(d)(iii)or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Agent. If offers are made by two or more
Banks with the same Bid-Option Rates for a greater aggregate principal amount
than the amount in respect of which offers are accepted for the related Interest
Period, the principal amount of Bid-Option Loans in respect of which such offers
are accepted shall be allocated by the Agent among such Banks as nearly as
possible (in such multiples, not greater than $100,000, as the Agent may deem
appropriate) in proportion to the aggregate principal amount of such offers.
Determinations by the Agent of the amounts of Bid-Option Loans shall be
conclusive in the absence of manifest error.
2.3 Swing Loans.
(a) Making of Swing Loans. The Agent may elect in its sole
discretion to make revolving loans (the "Swing Loans") to the Borrowers from
time to time prior to the Termination Date in Dollars or any Foreign Currency up
to an aggregate Dollar Equivalent at any one time outstanding not to exceed the
lesser of $25,000,000 or the unused amount of the aggregate Activated Revolving
Credit Commitments. The Agent may make Swing Loans (provided that the Agent has
received a request in writing or via telephone from the Treasury Manager for
funding of a Swing Loan) no later than such time required by the Agent, on the
Business Day on which such Swing Loan is requested to be made in the case of
Swing Loans in Dollars and on such number of Business Days agreed to between the
Agent and the Company after such Swing Loan is requested to be made in the case
of Swing Loans in any Foreign Currency. Each outstanding Swing Loan and interest
thereon shall be payable on the Business Day following demand therefor, but no
later than thirty (30) days after disbursement of such Swing Loan, with interest
at such rate as the Borrower requesting such Swing Loan and the Agent shall
agree, and shall otherwise be subject to all the terms and conditions applicable
to Loans, except that all interest thereon shall be payable to the Agent solely
for its own account. Repayment of any Swing Loan may, subject to the terms and
conditions of this Agreement, be accomplished through a request by the relevant
Borrower for a Revolving Credit Loan.
(b) Swing Loan Borrowing Requests. Upon request of the Agent,
the Treasury Manager agrees to deliver promptly to the Agent a written
confirmation of each telephonic notice for Swing Loans. If the written
confirmation differs in any material respect from the action taken by the Agent,
the records of the Agent shall govern, absent manifest error.
(c) Repayment of Swing Loans. At any time after making a Swing
Loan, the Agent may request a Borrower to, and upon request by the Agent such
Borrower shall, promptly request a Revolving Credit Loan from all the Banks and
apply the proceeds of such Revolving Credit Loan to the repayment of any Swing
Loan owing by such Borrower not later than three Business Days following the
Agent's request. Notwithstanding the foregoing, upon the earliest to occur of
(a) one Business Day after demand is made by the Agent, (b) the date a Swing
Loan is to be refunded with a Revolving Credit Loan, and (c) the Termination
Date, the Borrower agrees that each Swing Loan outstanding in a Foreign Currency
shall be immediately and automatically converted to and redenominated in Dollars
equal to the Dollar Equivalent of each such Swing Loan determined as of the date
of such conversion, and each Bank (other than the Agent) shall irrevocably and
unconditionally purchase from the Agent, without recourse or warranty, an
undivided interest and participation in such Swing Loan in an amount equal to
such Bank's Pro Rata Share of such Swing Loan and promptly pay such amount to
the Agent in immediately available funds. Such payment shall be made by the
other Banks whether or not a Default or Event of Default is then continuing or
20
any other condition precedent set forth in Section 2.8 is then met and whether
or not the Borrower has then requested an Advance in such amount; and such Swing
Loan shall thereupon be deemed to be a Floating Rate Loan hereunder made on the
date of such purchase (except, as aforesaid, with respect to the existence of
any Default or Event of Default or the meeting of any condition precedent
specified in Section 2.8 on such date). If any Bank fails to make available to
the Agent any amounts due to the Agent pursuant to this Section, the Agent shall
be entitled to recover such amount, together with interest thereon at the
Federal Funds Effective Rate for the first three Business Days after such Bank
receives notice of such required purchase and thereafter, at the Floating Rate,
payable (i) on demand, (ii) by setoff against any payments made to the Agent for
the account of such Bank or (iii) by payment to the Agent by the Agent of
amounts otherwise payable to such Bank under this Agreement. The failure of any
Bank to make available to the Agent its Pro Rata Share of any unpaid Swing Loan
shall not relieve any other Bank of its obligation hereunder to make available
to the Agent its Pro Rata Share of any unpaid Swing Loan on the date such
payment is to be made, but no Bank shall be responsible for the failure of any
other Bank to make available to the Agent its Pro Rata Share of any unpaid Swing
Loan.
2.4 Termination and Reduction of Revolving Credit Commitments.
(a) The Company shall have the right to terminate or reduce
the Revolving Credit Commitments at any time and from time to time at its
option, provided that (i) the Treasury Manager shall give three Business Days
prior written notice of such termination or reduction to the Agent (with
sufficient executed copies for each Bank) specifying the amount and effective
date thereof, (ii) each partial reduction of the Revolving Credit Commitments
shall be in a minimum amount of $10,000,000 and in integral multiples thereof
and shall reduce the Revolving Credit Commitments of all of the Banks
proportionately in accordance with the respective commitment amounts for each
such Bank set forth in the signature pages hereof next to the name of each such
Bank, (iii) no such termination or reduction shall be permitted with respect to
any portion of the Revolving Credit Commitments as to which a request for a
Borrowing pursuant to Section 2.6 is then pending, (iv) the Revolving Credit
Commitments may not be terminated if any Advances are then outstanding and may
not be reduced below the principal amount of Advances then outstanding, (v) each
partial reduction of any Alternate Currency Commitments with respect to any
Alternate Currency shall be in a minimum amount of $1,000,000 and in an integral
multiple thereof and shall reduce the applicable Alternate Currency Commitments
with respect to such Alternate Currency of all of the applicable Banks party
thereto proportionately in accordance with such respective Alternative Currency
Commitments of each such Bank, and (vi) no such termination or reduction shall
be permitted with respect to any portion of any Alternate Currency Commitments
as to which a request for a Borrowing is then pending. The Revolving Credit
Commitments or any portion thereof terminated or reduced pursuant to this
Section 2.4(a), whether optional or mandatory, may not be reinstated, other than
any reduction of the Revolving Credit Commitment in connection with the
activation of an Alternate Currency Commitment pursuant to Section 2.1(g). The
Borrowers shall immediately prepay the applicable Advances to the extent they
exceed the applicable reduced aggregate Commitments pursuant hereto.
(b) For purposes of this Agreement, a Letter of Credit Advance
(i) shall be deemed outstanding in an amount equal to the sum of the maximum
amount available to be drawn under the related Letter of Credit on or after the
date of determination and on or before the stated expiry date thereof plus the
amount of any draws under such Letter of Credit that have not been reimbursed
and (ii) shall be deemed outstanding at all times on and before such stated
expiry date or such earlier date on which all amounts available to be drawn
under such Letter of Credit have been fully drawn, and thereafter until all
related reimbursement obligations have been paid. Upon each payment made by the
Agent in respect of any draft or other demand for payment under any Letter of
Credit, the amount of any Letter of Credit Advance outstanding immediately prior
21
to such payment shall be automatically reduced by the amount of each Revolving
Credit Loan deemed advanced in respect of the related reimbursement obligation
of the Borrower.
2.5 Fees.
(a) The Company agrees to pay to the Banks a facility fee on
the amount of the Revolving Credit Commitments on a per diem basis, whether or
not activated and whether used or unused, for the period from the Effective Date
to but excluding the Termination Date, at a rate equal to the Applicable Fee
Rate for the facility fee. Accrued facility fees shall be payable quarterly in
arrears in Dollars within five (5) days of receipt of an invoice prepared by the
Agent containing a computation of facility fees due computed on the basis of 360
days and assessed for the actual number of days elapsed, which invoice shall be
prepared as of the last Business Day of each March, June, September and
December, commencing on December 31, 2001 and on the Termination Date.
(b) The Borrowers agree to pay (i) with respect to S/L/Cs, (A)
a fee to the Banks computed at the Applicable Fee Rate for Letters of Credit on
the maximum amount available to be drawn from time to time under such S/L/C for
the period from and including the date of issuance of such S/L/C to and
including the stated expiry date of such S/L/C, which fee shall be paid annually
in advance at the time such S/L/C is issued or amended, and (B) a fee to the
Agent for its own account computed at the rate of 0.125% per annum of such
maximum amount for such period, and (ii) with respect to C/L/Cs, a fee to the
Banks to be negotiated at the time of issuance between the Agent and the
Borrower requesting such C/L/C, which fees shall be paid at each time as any
C/L/C is presented or drawn upon, in whole or in part. Such fees are
nonrefundable and the Borrowers shall not be entitled to any rebate of any
portion thereof if such Letter of Credit does not remain outstanding through its
stated expiry date or for any other reason. The Borrowers further agree to pay
to the Agent, on demand, such other customary and reasonable administrative
fees, charges and expenses of the Agent in respect of the issuance, negotiation,
acceptance, amendment, transfer and payment of such Letter of Credit or
otherwise payable pursuant to the application and related documentation under
which such Letter of Credit is issued in accordance with a schedule of fees
provided by the Agent to the Borrowers.
(c) The Borrowers agree to pay to the Agent an agency fee for
its services as Agent under this Agreement in such amounts as may from time to
time be agreed upon by the Borrowers and the Agent.
2.6 Disbursement of Revolving Credit Advances.
(a) Except with respect to Swing Loans, the Treasury Manager
shall give the Agent notice of its request for each Advance in substantially the
form of Exhibit C hereto not later than 10:00 a.m. local time of the Applicable
Lending Installation (i) three Eurocurrency Business Days prior to the date such
Advance is requested to be made if such Borrowing is to be made as a
Eurocurrency Rate Loan, (ii) five Business Days prior to the date any Letter of
Credit Advance is requested to be made, (iii) at such time prior to the date
such Advance is requested to be made as specified in the applicable Alternate
Currency Addendum if such Borrowing is to be made as an Alternate Currency Loan
and (iv) on the date such Loan is requested to be made in all other cases, which
notice shall specify the Designated Borrower for which such Advance is
requested, whether a Eurocurrency Rate Loan, Floating Rate Loan, Alternate
Currency Loan or a Letter of Credit Advance is requested and, in the case of
each requested Eurocurrency Rate Loan, the Eurocurrency Interest Period to be
initially applicable to such Loan and the Foreign Currency in which such Loan is
to be denominated, and, in the case of each requested Alternate Currency Loan,
such other information as may be required pursuant to the applicable Alternate
Currency Addendum. The Agent, on the same day any such notice is given, shall
provide notice of such requested Revolving Credit Loan to each Bank. Subject to
22
the terms and conditions of this Agreement, the proceeds of each such requested
Revolving Credit Loan shall be made available to the Borrower requesting such
Loan by depositing the proceeds thereof, in immediately available funds, in the
case of any Loan denominated in Dollars in an account maintained and designated
by such Borrower at the principal office of the Agent, and, in all other cases,
in an account maintained and designated by such Borrower at the Applicable
Lending Installation of the Agent for such Borrower, at a bank acceptable to the
Agent in the principal financial center of the country issuing the Foreign
Currency in which such Loan is denominated or at such other place specified by
the Agent. Subject to the terms and conditions of this Agreement, the Agent
shall, on the date any Letter of Credit Advance is requested to be made, issue
the related Letter of Credit on behalf of the Banks for the account of the
Borrower requesting such Letter of Credit. Notwithstanding anything herein to
the contrary, the Agent may decline to issue any requested Letter of Credit on
the basis that the beneficiary, the purpose of issuance or the terms or the
conditions of drawing are unacceptable to it based upon any legal concerns in
its reasonable discretion or upon any policy of the Agent.
(b) Each Bank, on the date any Revolving Credit Loan is
requested to be made, shall make its pro rata share of such Revolving Credit
Loan available in immediately available, freely transferable cleared funds for
disbursement to the Designated Borrower requesting such Loan pursuant to the
terms and conditions of this Agreement, in the case of any Revolving Credit Loan
denominated in Dollars, at the principal office of the Agent and, in all other
cases, to the account of the Agent at its designated branch or correspondent
bank in the country issuing such Foreign Currency in which such Loan is
denominated or at such other place specified by the Agent. Unless the Agent
shall have received notice from any Bank prior to the date such Revolving Credit
Loan is requested to be made under this Section 2.6 that such Bank will not make
available to the Agent such Bank's pro rata portion of such Loan, the Agent may
assume that such Bank has made such portion available to the Agent on the date
such Loan is requested to be made in accordance with this Section 2.6. If and to
the extent such Bank shall not have so made such pro rata portion available to
the Agent, the Agent may (but shall not be obligated to) make such amount
available to such Designated Borrower, and such Bank agrees to pay to the Agent
forthwith on demand such amount together with interest thereon, for each day
from the date such amount is made available to such Designated Borrower by the
Agent until the date such amount is repaid to the Agent, at a rate per annum
equal to the Federal Funds Rate or the Agent's cost of funds with respect to
Foreign Currencies other than Dollars. If such Bank shall pay such amount to the
Agent together with interest, such amount so paid shall constitute a Revolving
Credit Loan by such Bank as part of the related Borrowing for purposes of this
Agreement. The failure of any Bank to make its pro rata portion of any such
Borrowing available to the Agent shall not relieve any other Bank of its
obligation to make available its pro rata portion of such Loan on the date such
Loan is requested to be made, but no Bank shall be responsible for failure of
any other Bank to make such pro rata portion available to the Agent on the date
of any such Loan.
(c) (i) Each Bank shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of each Borrower to such
Bank resulting from each Loan of such Bank from time to time, including the
amounts of principal and interest payable thereon and paid to such Bank from
time to time under this Agreement.
(ii) The Agent shall maintain an account for
each Borrower in its books and records with a subaccount for each Bank, in which
shall be recorded (a) the amount of each Loan made hereunder, the type thereof
and each Interest Period applicable thereto, (b) the amount of any principal or
interest due and payable or to become due and payable from each Borrower to each
Bank hereunder in respect of the Loans and (c) both the amount of any sum
received by the Agent hereunder from each Borrower in respect of the Loans and
each Bank's share thereof.
23
(iii) The books and records of the Agent and of
each Bank maintained pursuant to this Section 2.6(c) shall, to the extent
permitted by applicable law, be prima facie evidence of the existence and
amounts of the obligations of each Borrower therein recorded; provided, however,
that the failure of any Bank or the Agent to maintain any such books and records
or any error therein, shall not in any manner affect the obligation of each
Borrower to repay (with applicable interest) the Loans made to such Borrower by
such Bank in accordance with the terms of this Agreement.
(iv) Each Borrower agrees that, upon the
request to the Agent by any Bank, such Borrower will execute and deliver to
such Bank a Revolving Credit Note, a Bid-Option Note and a Swing Line Note (if
applicable) of such Borrower evidencing the Loans of such Bank; provided, that
the delivery of such Notes shall not be a condition precedent to the Effective
Date. Notwithstanding anything herein to the contrary, any and all references in
this Agreement or any other Loan Document to any amounts due or outstanding
under the Notes or evidenced by the Notes shall, in the event Notes are not
executed and delivered in accordance with this Section 2.6(c), be deemed to
refer to the Advances and all other amounts outstanding under this Agreement.
(v) Subject to the terms and conditions of
this Agreement, each Borrower may borrow Revolving Credit Loans under this
Section 2.6, prepay Revolving Credit Loans pursuant to Section 3.1 and reborrow
Revolving Credit Loans under this Section 2.6.
(d) All Bid-Option Loans shall be disbursed directly by the
Bank making such Bid-Option Loan to the Designated Borrower by 1:30 p.m. Detroit
time on the date such Bid-Option Loan is requested to be made via wire transfer
in immediately available funds to Bank One, Michigan, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ABA Number ▇▇▇▇▇▇▇▇▇, Attention: Agency Administration,
Reference: Invacare Bid-Option, confirm to Agency Administration, Facsimile No.
(▇▇▇) ▇▇▇-▇▇▇▇ or as otherwise directed by the Borrowers.
(e) Nothing in this Agreement shall be construed to require or
authorize any Bank to issue any Letter of Credit, it being recognized that the
Agent has the sole obligation under this Agreement to issue Letters of Credit on
behalf of the Banks, and the Commitment of each Bank with respect to Letter of
Credit Advances is expressly conditioned upon the Agent's performance of such
obligations. Upon such issuance by the Agent, each Bank shall automatically
acquire a pro rata risk participation interest in such Letter of Credit Advance
based on the amount of its respective Commitment. If the Agent shall honor a
draft or other demand for payment presented or made under any Letter of Credit,
the Agent shall provide notice thereof to each Bank (which notice shall be
provided by 2:00 p.m. Detroit time) on the date such draft or demand is honored
unless a Borrower shall have satisfied its reimbursement obligation by payment
to the Agent on such date. Each Bank, on such date, shall make its pro rata
share of the amount paid by the Agent available in immediately available funds
at the principal office of the Agent for the account of the Agent. If and to the
extent such Bank shall not have made such pro rata portion available to the
Agent, such Bank and the Borrowers severally agree to pay to the Agent forthwith
on demand such amount together with interest thereon, for each day from the date
such amount was paid by the Agent until such amount is so made available to the
Agent at a per annum rate equal to the Federal Funds Rate or the Agent's cost of
funds with respect to Permitted Currencies other than Dollars. If such Bank
shall pay such amount to the Agent together with such interest, such amount so
paid shall constitute a Revolving Credit Loan by such Bank as part of the
Revolving Credit Borrowing disbursed in respect of the reimbursement obligation
of the Company for purposes of this Agreement. The failure of any Bank to make
its pro rata portion of any such amount paid by the Agent available to the Agent
shall not relieve any other Bank of its obligation to make available its pro
rata portion of such amount, but no Bank shall be responsible for failure of any
other Bank to make such pro rata portion available to the Agent.
24
(f) All notifications by the Agent to each applicable
Alternate Currency Bank of each request for an Alternate Currency Loan, the
procedures under which each Alternate Currency Bank shall make its Alternate
Currency Loans available, the procedures by which the Agent will make the
Alternate Currency Loans available to the applicable Borrower, any instruments
evidencing the Alternate Currency Loans and other related procedures with
respect to the Alternate Currency Loans shall be as set forth in the applicable
Alternate Currency Addendum.
2.7 Conditions for Closing and First Disbursement. The effectiveness of
this Agreement and the obligation of each Bank to make its first Advance
hereunder is subject to receipt by each Bank and the Agent of the following
documents and completion of the following matters, in form and substance
reasonably satisfactory to each Bank and the Agent:
(a) Charter Documents. Certificates of recent date of the
appropriate authority or official of the Company's state of incorporation
listing all charter documents of the Company, on file in that office and
certifying as to the good standing and corporate existence of the Company,
together with copies of such charter documents of the Company, certified as of a
recent date by such authority or official and certified as true and correct as
of the Effective Date by a duly authorized officer of the Company;
(b) By-Laws and Corporate Authorizations. Copies of the
by-laws of the Company together with all authorizing resolutions and evidence of
other corporate action taken by the Company to authorize the execution, delivery
and performance by the Company of this Agreement, the Guaranty and the Notes and
the consummation by the Company of the transactions contemplated hereby,
certified as true and correct as of the Effective Date by a duly authorized
officer of the Company;
(c) Incumbency Certificate. Certificates of incumbency of each
Borrower containing, and attesting to the genuineness of, the signatures of
those officers authorized to act on behalf of such Borrower in connection with
this Agreement and the Notes and the consummation by such Borrower of the
transactions contemplated hereby, certified as true and correct as of the
Effective Date by a duly authorized officer of each Borrower;
(d) Loan Documents. Execution and delivery to the Agent
by each of the parties thereto of this Agreement, any Notes requested by any
Bank and any other required Loan Documents;
(e) Legal Opinion. The favorable written opinion of
counsel for the Company in the form of Exhibit J attached hereto;
(f) Consents, Approvals, Etc. Copies of all governmental and
nongovernmental consents, approvals, authorizations, declarations, registrations
or filings, if any, required on the part of the Company in connection with the
execution, delivery and performance of this Agreement, the Guaranty and the
Notes or the transactions contemplated hereby or as a condition to the legality,
validity or enforceability of this Agreement and the Notes, certified as true
and correct and in full force and effect as of the Effective Date by a duly
authorized officer of the Company, or, if none are required, a certificate of
such officer to that effect;
(g) 1997 Credit Agreement. All indebtedness and obligations
pursuant to the 1997 Credit Agreement shall be paid in full simultaneously with
the first Advance hereunder, and the Company and the other Borrowers hereby
terminate all commitments to lend under the 1997 Credit Agreement;
25
(h) 364-Day Credit Agreement. The 364-Day Credit
Agreement shall close simultaneously with this Agreement;
(i) Solvency and Compliance Certificates. A solvency
certificate duly executed by the Company in form and substance satisfactory
to the Agent and an opening compliance certificate in the form attached
hereto as Exhibit M duly executed by the Company; and
(j) Miscellaneous. Such other agreements and documents, and
the satisfaction of such other conditions as may reasonably be required by the
Agent or the Required Banks, including without limitation such funding
instructions, sources and uses certificates, opinions of foreign counsel,
evidence satisfactory to the Agent that the Advances hereunder are made in
compliance with all applicable laws and regulations, including without
limitation Regulations T, U and X of the Board of Governors of the Federal
Reserve System.
2.8 Further Conditions for Disbursement. The obligation of each Bank to
make any Advance (including its first Advance), or any continuation or
conversion under Section 2.9, is further subject to the satisfaction of the
following conditions precedent:
(a) The representations and warranties contained in Article IV
hereof and in any other Loan Document shall be true and correct in all material
respects on and as of the date such Advance is made, continued or converted
(both before and after such Advance is made, continued or converted) as if such
representations and warranties were made on and as of such date; and
(b) No Event of Default and no Default shall exist or shall
have occurred and be continuing on the date such Advance is made, continued or
converted (whether before or after such Advance is made, continued or
converted);
(c) Prior to the issuance of the initial Letter of Credit
Advance, the Borrowers, the Agent and the Banks shall have entered into an
agreement containing terms and conditions regarding Letters of Credit, which
agreement shall be mutually satisfactory to all parties thereto.
(d) In the case of any Letter of Credit Advance, the Borrower
requesting such Letter of Credit Advance shall have delivered to the Agent an
application for the related Letter of Credit and other related documentation
requested by and acceptable to the Agent and the Banks appropriately completed
and duly executed on behalf of such Borrower and the Agent and the Banks shall
have negotiated all fees described in Section 2.5(b).
(e) Prior to any Advance to any Borrowing Subsidiary, such
Borrowing Subsidiary shall deliver such corporate or organizational documents
and authorizing resolutions and legal opinions as reasonably requested by the
Agent and such Borrowing Subsidiary and the Borrowers shall execute all
agreements and take such other action reasonably requested by the Agent for such
Borrowing Subsidiary to become a Borrowing Subsidiary hereunder.
Each Borrower shall be deemed to have made a representation and warranty to the
Banks at the time of the making of, and the continuation or conversion of, each
Advance to the effects set forth in clauses (a) and (b) of this Section 2.8. For
purposes of this Section 2.8, the representations and warranties contained in
Section 4.6 hereof shall be deemed made with respect to the most recent
financial statements delivered pursuant to Section 5.1(d)(ii) and (iii).
2.9 Subsequent Elections as to Borrowings. The Treasury Manager may
elect (a) to continue a Fixed Rate Revolving Credit Borrowing of one type, or a
26
portion thereof, as a Fixed Rate Revolving Credit Borrowing of the then existing
type, or (b) may elect to convert a Fixed Rate Revolving Credit Borrowing, or a
portion thereof, to a Borrowing of another type or (c) elect to convert a
Floating Rate Borrowing, or a portion thereof, to a Fixed Rate Revolving Credit
Borrowing, in each case by giving notice thereof to the Agent in substantially
the form of Exhibit K hereto at the principal office of the Agent and at the
Applicable Lending Installation of the Agent with respect to such Loan not later
than 10:00 a.m. local time of the Applicable Lending Installation (i) three (3)
Eurocurrency Business Days prior to the date any such continuation of or
conversion to a Eurocurrency Rate Revolving Credit Borrowing is to be effective
and (ii) the date such continuation or conversion is to be effective in all
other cases, provided that an outstanding Fixed Rate Revolving Credit Borrowing
may only be converted on the last day of the then current Interest Period with
respect to such Borrowing, and provided, further, if a continuation of a
Borrowing as, or a conversion of a Borrowing to, a Fixed Rate Revolving Credit
Borrowing is requested, such notice shall also specify the Interest Period to be
applicable thereto upon such continuation or conversion. The Agent, on the day
any such notice is given, shall provide notice of such election to the Banks. If
the Treasury Manager shall not timely deliver such a notice with respect to any
outstanding Fixed Rate Revolving Credit Borrowing, the Borrower shall be deemed
to have elected with respect to any Loan denominated in Dollars, to convert such
Fixed Rate Revolving Credit Borrowing to a Floating Rate Borrowing on the last
day of the then current Interest Period with respect to such Borrowing and, with
respect to any other Loan, to continue such Loan as a Fixed Rate Borrowing of
the same type with an Interest Period of one month on the last day of the then
current Interest Period with respect to such Borrowing.
2.10 Limitation of Requests and Elections. Notwithstanding any other
provision of this Agreement to the contrary, if, upon receiving a request for a
Fixed Rate Revolving Credit Borrowing pursuant to Section 2.6, or a request for
a continuation of a Fixed Rate Revolving Credit Borrowing as a Fixed Rate
Revolving Credit Borrowing of the then existing type, or a request for a
conversion of a Floating Rate Borrowing to a Fixed Rate Revolving Credit
Borrowing pursuant to Section 2.9, (a) in the case of any Eurocurrency Rate
Borrowing, deposits in the relevant Permitted Currency for periods comparable to
the Interest Period elected by the Borrower are not available to any Bank in the
relevant interbank or secondary market and such Bank has provided to the Agent
and the Borrowers a certificate prepared in good faith to that effect, or (b)
any Bank reasonably determines that the applicable interest rate (net of the
Applicable Margin for the Eurocurrency Rate) will not adequately and fairly
reflect the cost to such Bank of making, funding or maintaining the related
Fixed Rate Revolving Credit Loan and such Bank has provided to the Agent and the
Borrowers a certificate prepared in good faith to that effect, or (c) by reason
of national or international financial, political or economic conditions or by
reason of any applicable law, treaty, rule or regulation (whether domestic or
foreign) now or hereafter in effect, or the interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof, or compliance by any Bank with any directive of such
authority (whether or not having the force of law), including without limitation
exchange controls, it is impracticable, unlawful or impossible for any Bank (i)
to make or fund the relevant Fixed Rate Revolving Credit Borrowing or (ii) to
continue such Fixed Rate Revolving Credit Borrowing as a Fixed Rate Revolving
Credit Borrowing of the then existing type or (iii) to convert a Loan to such a
Fixed Rate Revolving Credit Loan, and such Bank has provided to the Agent and
the Borrowers a certificate prepared in good faith to that effect, then the
Borrowers shall not be entitled, so long as such circumstances continue, to
request a Fixed Rate Revolving Credit Borrowing of the affected type pursuant to
Section 2.6 or a continuation of or conversion to a Fixed Rate Revolving Credit
Borrowing of the affected type pursuant to Section 2.9. In the event that such
circumstances no longer exist, the Banks shall again honor requests, subject to
this Agreement, for Fixed Rate Revolving Credit Borrowings of the affected type
pursuant to Section 2.6, and requests for continuations of and conversions to
Fixed Rate Revolving Credit Borrowings of the affected type pursuant to Section
2.9. Limitations on request for Alternate Currency Loans shall be as set forth
in the applicable Alternate Currency Addendum.
27
2.11 Minimum Amounts; Limitation on Number of Borrowings. Except for
(a) Borrowings and conversions thereof which exhaust the entire remaining amount
of the Revolving Credit Commitments, and (b) conversions or payments required
pursuant to Section 3.1(d) or Section 3.7, each Revolving Credit Loan and each
continuation or conversion pursuant to Section 2.9 and each prepayment thereof
shall be in a minimum amount of $1,000,000 and in integral multiples of $500,000
and each Letter of Credit shall be in a minimum amount of $250,000 with respect
to any S/L/C and $50,000 with respect to any C/L/C. Notwithstanding anything
herein to the contrary, the Borrowers shall not be permitted to request (a) that
any Revolving Credit Loan be denominated in any currency other than a Syndicated
Currency, (b) that any Revolving Credit Loan other than a Eurocurrency Rate Loan
be denominated in a currency other than Dollars, or (c) that any Alternate
Currency Loan be denominated in any currency other than as specified in the
applicable Alternate Currency Addendum.
2.12 Treasury Manager. Each Borrower authorizes the Treasury Manager to
act as its manager in making requests and in carrying out as its manager and on
its behalf all other functions conferred on the Treasury Manager under this
Agreement and all other ancillary functions. Each Borrower further agrees that
the Treasury Manager may nominate any Borrower as the Designated Borrower, and
agrees that the Advances allocated to it, and all other acts carried out by the
Treasury Manager falling within its authority, shall be conclusive and binding
on it and all parties. Neither any Bank nor the Agent is or shall be deemed to
be concerted as to the Treasury Manager's compliance with instructions from any
Borrower. The content of each request and every other notice delivered by the
Treasury Manager shall be irrevocable, and the Agent and the Banks shall be
entitled to rely fully on their content.
2.13 Applicable Lending Installation. Each Bank and the Agent may make
and book its Loans and, in the case of the Agent, issue Letters of Credit, at
any Applicable Lending Installation(s) selected by such Bank or the Agent, as
the case may be, and each Bank and the Agent may change its Applicable Lending
Installation(s) from time to time. Each Bank may, by written notice to the Agent
and the applicable Borrower, designate one or more Applicable Lending
Installations which are to make and book Loans and for whose account Loan
payments are to be made. The Agent may, by written notice to the applicable
Borrower, designate one or more Applicable Lending Installations which are to
issue and book Letters of Credit and for whose accounts Loan payments and Letter
of Credit reimbursements are to be made and through which its functions are to
be performed. All terms of this Agreement shall apply to any such Applicable
Lending Installation(s) and the Notes shall be deemed held by each Bank and the
Agent, as the case may be, for the benefit of such Applicable Lending
Installation. Each Bank agrees to designate a different Applicable Lending
Installation if such designation would avoid the need for, or reduce the amount
of any compensation, which may be required to be paid by any Borrower pursuant
to Section 3.4 or 3.6, provided that such designation would not, in the judgment
of such Bank, be otherwise disadvantageous to such Bank in any material manner.
ARTICLE III
PAYMENTS AND PREPAYMENTS
3.1 Principal Payments.
(a) Unless earlier payment is required under this Agreement,
the Borrowers shall pay to the Banks on the Termination Date the entire
outstanding principal amount of the Revolving Credit Loans.
(b) Unless earlier payment is required under this Agreement,
the Borrowers shall, on the maturity date of any Bid-Option Loan, pay to the
Bank of such Bid-Option Loan the outstanding principal amount of such Loan.
28
(c) Unless earlier payment is required under this Agreement or
under any Alternate Currency Addendum, the Borrowers shall pay to the applicable
Alternate Currency Banks on the Termination Date, the entire outstanding
principal amount of the Alternate Currency Loans.
(d) The Borrowers may at any time and from time to time prepay
all or a portion of the Loans without premium or penalty, provided that (i) a
Borrower may not prepay any portion of any Loan as to which an election for
continuation of or conversion to a Fixed Rate Revolving Credit Loan is pending
pursuant to Section 2.9, (ii) unless earlier payment is required under this
Agreement or unless Borrower pays all amounts required pursuant to Section 3.8,
any Fixed Rate Revolving Credit Loan or Bid-Option Loan may only be prepaid on
the last day of the then current Interest Period with respect to such Loan,
(iii) any prepayment of any Alternate Currency Loan shall be subject to the
provisions of the applicable Alternate Currency Addendum, and (iv) such
prepayment shall only be permitted if the Treasury Manager shall have given
notice thereof on the Business Day of such prepayment with respect to prepayment
of Floating Rate Loans and not later than 10:00 a.m. local time three (3)
Eurocurrency Business Days notice thereof with respect to prepayment of
Eurocurrency Rate Loans, such notice specifying the Loan or portion thereof to
be so prepaid and shall have paid to the Banks, together with such prepayment of
principal, all accrued interest to the date of payment on such Loan or portion
thereof so prepaid and all amounts owing to the Banks under Section 3.8 in
connection with such prepayment. Upon the giving of such notice, the aggregate
principal amount of such Loan or portion thereof so specified in such notice,
together with such accrued interest and other amounts, shall become due and
payable on the specified date.
(e) In addition to all other payments required hereunder, as
of the last Business Day of each month and as of the date each Advance is made
or continued or converted hereunder, if the Dollar Equivalent of all Advances
exceeds the aggregate amount of the Revolving Credit Commitments, the Borrowers
shall prepay the Advances, in such order as determined by the Borrowers, in an
amount such that the Dollar Equivalent of all Advances does not exceed the
aggregate amount of the Revolving Credit Commitments as of such date, together
with all amounts owing to the applicable Banks under Section 3.8 or the
applicable Alternate Currency Addendum in connection therewith, if any.
(f) In addition to all other payments required hereunder, as
of the last Business Day of each month and as of the date each Advance is made
or continued or converted hereunder, if the Dollar Equivalent of all Advances in
Alternate Currencies exceeds the least of (i) $50,000,000, (ii) the aggregate
amount of the Activated Alternate Currency Commitments or (iii) the aggregate
amount that would be permitted by the proviso to Section 2.1(a), the Borrowers
shall prepay the Advances in such order as determined by the Borrowers, in an
amount such that the Dollar Equivalent of all Advances in Alternate Currencies
does not exceed such amount as of such date, together with all amounts owing to
the applicable Banks under Section 3.8 or the applicable Alternate Currency
Addendum in connection therewith, if any.
(g) In addition to all other payments required hereunder, as
of the last Business Day of each month and as of the date each Advance under any
Alternate Currency Addendum is made or continued or converted hereunder, if the
Dollar Equivalent of all Advances pursuant to such Alternate Currency Addendum
exceeds the aggregate Activated Alternate Currency Commitments pursuant to such
Alternate Currency Addendum, the Borrowers shall prepay such Alternate Currency
Advances, in such order as determined by Borrowers, in an amount such that the
Dollar Equivalent of such Alternate Currency Advances does not exceed the amount
specified in the applicable Alternate Currency Addendum as of such date,
together with all amounts owing to the applicable Banks under Section 3.8 or the
applicable Alternate Currency Addendum in connection therewith, if any.
29
3.2 Interest Payments. The Borrowers shall pay interest to the Banks on
the unpaid principal amount of each Loan (other than Bid-Option Loans, for which
the interest shall be payable directly to the Bank of such Bid-Option Loan as
described in clause (b) below), for the period commencing on the date such Loan
is made until such Loan is paid in full, on each Interest Payment Date and at
maturity (whether at stated maturity, by acceleration or otherwise), and
thereafter on demand, at the following rates per annum:
(a) With respect to Revolving Credit Loans (other than
Alternate Currency Loans):
(i) During such periods that such Loan is a
Floating Rate Loan, the Floating Rate.
(ii) During such periods that such Loan is
a Eurocurrency Rate Loan, the Eurocurrency Rate applicable to such Loan for
each related Eurocurrency Interest Period.
(b) With respect to Alternate Currency Loans, the interest
rate for such Alternate Currency Loans specified in the applicable Alternate
Currency Addendum.
(c) With respect to Bid-Option Loans, the Bid-Option Rate
quoted for such Loan by the Bank making such Loan.
(d) With respect to Swing Loans, the interest rate
for such Swing Loan specified in Section 2.3.
Notwithstanding the foregoing paragraphs (a) through (d), the Borrowers shall
pay interest on demand at the Overdue Rate on the outstanding principal amount
of any Loan and any other amount payable by the Borrowers hereunder (other than
interest) on and after an Event of Default.
3.3 Payment Method.
(a) All payments to be made by the Borrowers hereunder will be
made to the Agent for the account of the Banks (i) in the case of principal and
interest on any Loan, in the Permitted Currency in which such Loan is
denominated and (ii) in all other cases, in the otherwise specified or relevant
currency, and in all cases in immediately available, freely transferable,
cleared funds, in the case of any payment to be made in Dollars, not later than
2:00 p.m. at the place for payment on the date on which such payment shall be
come due and, in all other cases, on the date on which such payment shall become
due, (x) in the case of principal and interest on any Loan denominated in a
Permitted Currency other than Dollars, by credit to the account of the Agent at
its designated branch or correspondent bank in the country issuing the relevant
Permitted Currency or in such other place specified by the Agent with respect to
such Loan pursuant to Section 2.6(b), and (y) in all other cases to the Agent at
the address of its principal office specified in Section 8.2. Payments to be
made in Dollars received after 2:00 p.m. at the place for payment shall be
deemed to be payments made prior to 2:00 p.m. at the place for payment on the
next succeeding Business Day. Each Borrower hereby authorizes the Agent to
charge its account with the Agent in order to cause timely payment of amounts
due hereunder to be made (subject to sufficient funds being available in such
account for that purpose).
(b) At the time of making each such payment, a Borrower shall,
subject to the other terms and conditions of this Agreement, specify to the
Agent that Borrowing or other obligation of the Borrowers hereunder to which
such payment is to be applied. In the event that a Borrower fails to so specify
the relevant obligation or if an Event of Default shall have occurred and be
continuing, the Agent may apply such payments as it may determine in its sole
30
discretion to obligations of the Borrowers to the Banks arising under this
Agreement.
(c) On the day such payments are deemed received, the Agent
shall promptly remit to the Banks their pro rata shares of such payments in
immediately available funds, (i) in the case of payments of principal and
interest on any Borrowing denominated in a Permitted Currency other than
Dollars, at an account maintained and designated by each Bank at a bank in the
principal financial center of the country issuing the Permitted Currency in
which such Borrowing is denominated or in such other place specified by the
Agent and agreed to by the Banks and (ii) in all other cases, to the Banks at
their respective address in the United States specified for notices pursuant to
Section 8.2. Such pro rata shares shall be determined with respect to each such
Bank, (i) in the case of payments of principal and interest on any Borrowing, by
the ratio which the outstanding principal balance of its Loan included in such
Borrowing bears to the outstanding principal balance of the Loans of all of the
Banks included in such Borrowing and (ii) in the case of fees paid pursuant to
Section 2.5 and other amounts payable hereunder (other than the Agent's fees
payable pursuant to Section 2.5(c) and amounts payable to any Bank under Section
2.6 or 3.6) by the ratio which the Commitment of such Bank bears to the
Commitments of all the Banks.
(d) This Agreement arises in the context of an international
transaction, and the specification of payment in a specific currency at a
specific place pursuant to this Agreement is of the essence. Such specified
currency shall be the currency of account and payment under this Agreement. The
obligations of the Borrowers hereunder shall not be discharged by an amount paid
in any other currency or at another place, whether pursuant to a judgment or
otherwise, to the extent that the amount so paid, on prompt conversion into the
applicable currency and transfer to the Banks under normal banking procedure,
does not yield the amount of such currency due under this Agreement. In the
event that any payment, whether pursuant to a judgment or otherwise, upon
conversion and transfer, does not result in payment of the amount of such
currency due under this Agreement, the Banks shall have an independent cause of
action against the Borrowers for the currency deficit.
(e) If for purposes of obtaining judgment in any court it
becomes necessary to convert any currency due hereunder into any other currency,
the Borrowers will pay such additional amount, if any, as may be necessary to
ensure that the amount paid in respect of such judgment is the amount in such
other currency which, when converted at the Agent's spot rate of exchange
prevailing on the date of payment, would yield the same amount of the currency
due hereunder. Any amount due from the Borrowers under this Section 3.3(e) will
be due as a separate debt and shall not be affected by judgment being obtained
for any other sum due under or in respect of this Agreement.
3.4 No Setoff or Deduction.
(a) All such payments shall be made free and clear of any
present or future taxes or withholdings and without any set-off or counter claim
or any restriction or condition or deduction whatsoever. The Designated Borrower
shall indemnify the Agent and each Bank against any taxes or charges (other than
taxes imposed on net overall income of the Bank or the Agent, by the
jurisdiction, or by any political subdivision or taxing authority of any such
jurisdiction, in which any Bank or the Agent, as the case may be, has its
principal office) which may be claimed from it in respect of the Advances or any
of them or any sum payable by the Borrowers or any of them hereunder and against
any costs, charges and expenses or liabilities in respect of such claim and such
indemnity shall survive the termination of the Commitments.
(b) If at any time any Borrower is required by law or by any
directive or order of any court of competent jurisdiction to make any deduction
31
or withholding of whatsoever nature from any payment due under this Agreement or
any of the Loan Documents, such Borrower will ensure that the same does not
exceed the minimum liability therefor and will (a) pay to any Bank on request
such additional amount as such Bank certifies will result in the net amount
received by it after all deductions being equal to the full amount which would
have been receivable had there been no deduction or withholding and (b) pay
forthwith to the relevant authorities the full amount of the deduction or
withholding and deliver to the Agent such an official receipt, certificate or
other proof evidencing the amount paid in respect of such deduction or
withholding. Any additional amount paid under this sub-clause shall not be
treated as interest but as agreed compensation.
(c) If any payment by any Borrower is made to or for the
account of any Bank after deduction for or on account of tax, and additional
payments are made by the Designated Borrower then, if any Bank shall receive or
be granted a credit against or remission for such tax, such Bank shall, to the
extent that it can do so without prejudice to the retention of the amount of
such credit or remission, reimburse to the Designated Borrower such amount as
such Bank shall, in its absolute opinion, have concluded to be attributable to
the relevant tax or deduction or withholding. Nothing herein contained shall
interfere with the right of any Bank to arrange its affairs in whatever manner
it thinks fit and, in particular, the Banks shall not be under any obligation to
claim relief from its corporation profits or similar tax liability in respect of
such tax in priority to any other claims, reliefs, credits or deductions
available to it nor oblige any Bank to disclose any information relating to its
tax affairs. Such reimbursement shall be made as soon as reasonably practical
upon such Bank certifying that the amount of such credit or remission has been
received by it.
3.5 Payment on Non-Business Day; Payment Computations. Except as
otherwise provided in this Agreement to the contrary, whenever any installment
of principal of, or interest on, any Loan or any other amount due hereunder
becomes due and payable on a day which is not a Business Day, the maturity
thereof shall be extended to the next succeeding Business Day and, in the case
of any installment of principal, interest shall be payable thereon at the rate
per annum determined in accordance with this Agreement during such extension.
Except as otherwise provided in this Agreement to the contrary, computations of
interest and other amounts due under this Agreement shall be made on the basis
of a year of 360 days, 365 or 366 days, as determined by the Agent to be the
custom and practice in the relevant market, for the actual number of days
elapsed, including the first day but excluding the last day of the relevant
period.
3.6 Additional Costs.
(a) In the event that any applicable law, treaty, rule or
regulation (whether domestic or foreign) now or hereafter in effect and whether
or not presently applicable to any Bank or the Agent, or any interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by any Bank or the Agent
with any directive of any such authority (whether or not having the force of
law), shall (i) affect the basis of taxation of payments to any Bank or the
Agent of any amounts payable by any Borrower under this Agreement (other than
taxes imposed on the overall net income of the Bank or the Agent, by the
jurisdiction, or by any political subdivision or taxing authority of any such
jurisdiction, in which any Bank or the Agent, as the case may be, has its
principal office), or (ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by any Bank or the Agent, as the case may be,
or (iii) shall impose any other condition with respect to this Agreement, the
Commitments, the Notes or the Advances, and the result of any of the foregoing
is to increase the cost to any Bank or the Agent, as the case may be, of making,
funding or maintaining any Fixed Rate Loan or to reduce the amount of any sum
receivable by any Bank or the Agent, thereon, then the Borrowers shall pay to
such Bank or the Agent, as the case may be, from time to time, upon request by
such Bank (with a copy of such request to be provided to the Agent) or the
Agent, additional amounts sufficient to compensate such Bank or the Agent, as
32
the case may be, for such increased cost or reduced sum receivable to the
extent, in the case of any Fixed Rate Loan, such Bank or the Agent, as the case
may be, is not compensated therefor in the computation of the interest rate
applicable to such Fixed Rate Loan. Each Bank or the Agent, as the case may be,
seeking compensation hereunder shall deliver to the Borrowers a statement
setting forth (i) such increased cost or reduced sum receivable as such Bank or
the Agent, as the case may be, has calculated in good faith, (ii) a description
of the event giving rise thereto, (iii) a calculation in reasonable detail of
the amounts requested and (iv) a statement that such Bank or the Agent, as the
case may be, has not allocated to its Commitment, Borrowings or outstanding
Loans a proportionately greater amount than is attributable to each of its other
credit extensions that are affected similarly by compliance by such Bank or the
Agent, as the case may be, whether or not such Bank or the Agent, as the case
may be, allocates any portion of such amount to such other commitments or credit
extensions. Such statement as to the amount of such increased cost or reduced
sum receivable, prepared in good faith and in reasonable detail by such Bank or
the Agent, as the case may be, and submitted by such Bank or the Agent, as the
case may be, to the Borrowers, shall be conclusive and binding for all purposes
absent manifest error in computation.
(b) In the event that any applicable law, treaty, rule or
regulation (whether domestic or foreign) now or hereafter in effect and whether
or not presently applicable to any Bank or the Agent, but applicable to banks or
financial institutions generally, or any interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof, or compliance by any Bank or the Agent with any
directive of any such authority (whether or not having the force of law),
including any risk-based capital guidelines, affects the amount of capital
required or expected to be maintained by such Bank or the Agent (or any
corporation controlling such Bank or the Agent) and such Bank or the Agent, as
the case may be, determines that the amount of such capital is increased by or
based upon the existence of such Bank's or the Agent's obligations hereunder and
such increase has the effect of reducing the rate of return on such Bank's or
the Agent's (or such controlling corporation's) capital as a consequence of such
obligations hereunder to a level below that which such Bank or the Agent (or
such controlling corporation) could have achieved but for such circumstances
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank or the Agent to be material, then the Borrowers shall
pay to such Bank or the Agent, as the case may be, from time to time, upon
request by such Bank (with a copy of such request to be provided to the Agent)
or the Agent, additional amounts sufficient to compensate such Bank or the Agent
(or such controlling corporation) for any reduced rate of return which such Bank
or the Agent reasonably determines to be allocable to the existence of such
Bank's or the Agent's obligations hereunder. Each Bank or the Agent, as the case
may be, seeking compensation hereunder shall deliver to the Borrowers a
statement setting forth (i) such increased cost or reduced sum receivable as
such Bank or the Agent, as the case may be, has calculated in good faith, (ii) a
description of the event giving rise thereto, (iii) a calculation in reasonable
detail of the amounts requested and (iv) a statement that such Bank or the
Agent, as the case may be, has not allocated to its Commitment, Borrowings or
outstanding Loans a proportionately greater amount than is attributable to each
of its other credit extensions that are affected similarly by compliance by such
Bank or the Agent, as the case may be, whether or not such Bank or the Agent, as
the case may be, allocates any portion of such amount to such other commitments
or credit extensions. Such statement as to the amount of such compensation,
prepared in good faith and in reasonable detail by such Bank or the Agent, as
the case may be, and submitted by such Bank or the Agent to the Borrowers, shall
be conclusive and binding for all purposes absent manifest error in computation.
(c) The Borrowers shall have no obligation to compensate any
Bank with respect to amounts provided in this Section 3.6 with respect to any
period prior to the date which is 90 days prior to the date such Bank delivers
its written statement hereunder requesting compensation.
33
3.7 Illegality and Impossibility. In the event that any applicable law,
treaty, rule or regulation (whether domestic or foreign) now or hereafter in
effect and whether or not presently applicable to any Bank, or any
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof, or compliance by any Bank
with any directive of such authority (whether or not having the force of law),
including without limitation exchange controls, shall make it unlawful or
impossible for any Bank to maintain any Fixed Rate Loan under this Agreement or
shall make it impracticable, unlawful or impossible for, or shall in any way
limit or impair the ability of, any Borrower to make or any Bank to receive any
payment under this Agreement at the place specified for payment hereunder, or to
freely convert any amount paid into Dollars at market rates of exchange or to
transfer any amount paid or so converted to the address of its principal office
specified in Section 8.2, the Borrowers shall upon receipt of notice thereof
from such Bank, repay in full the then outstanding principal amount of each
Fixed Rate Loan so affected, together with all accrued interest thereon to the
date of payment and all amounts owing to such Bank under Section 3.8, (a) on the
last day of the then current Interest Period applicable to such Loan if such
Bank may lawfully continue to maintain such Loan to such day, or (b) immediately
if such Bank may not continue to maintain such Loan to such day.
3.8 Indemnification. If any Borrower makes any payment of principal
with respect to any Loan on any other date than the last day of an Interest
Period applicable thereto, (whether pursuant to Section 3.7 or Section 6.2 or
otherwise), or if any Borrower fails to borrow, continue or convert any Loan
after notice has been given to the Banks in accordance with Section 2.6 or
Section 2.9, on the date or in the amount specified in such notice, then the
Borrowers shall reimburse each Bank on demand for any resulting net loss or
expense incurred by each such Bank after giving credit for any earnings or other
quantifiable financial benefit to such Bank from such Bank's investment or other
amounts prepaid or not reborrowed, including without limitation any loss
incurred in obtaining, liquidating or employing deposits from third parties,
whether or not such Bank shall have funded or committed to fund such Loan. A
statement as to the amount of such loss or expense, prepared in good faith and
in reasonable detail by such Bank and submitted by such Bank to the Borrowers,
shall be conclusive and binding for all purposes absent manifest error in
computation, provided that before delivery of such statement, each Bank shall
use reasonable efforts in accordance with its normal practices and procedures to
reduce amounts payable under this Section. Calculation of all amounts payable to
such Bank under this Section 3.8 shall be made as though such Bank shall have
actually funded or committed to fund the relevant Loan through the purchase of
an underlying deposit in an amount equal to the amount of such Loan and having a
maturity comparable to the related Interest Period; provided, however, that such
Bank may fund any Loan in any manner it sees fit and the foregoing assumption
shall be utilized only for the purpose of calculation of amounts payable under
this Section 3.8.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants to the Agent and the Banks that:
4.1 Corporate Existence and Power. Each Borrower is a Person duly
organized, validly existing and in good standing under the laws of the state or
other political subdivision of its jurisdiction of incorporation or
organization, as the case may be, and is duly qualified to do business, and is
in good standing, in all additional jurisdictions where such qualification is
necessary under applicable law, except where the failure to be so qualified
would not have a Material Adverse Effect. Each Borrower has all requisite
corporate power to own or lease the properties used in its business and to carry
on its business as now being conducted and as proposed to be conducted, and to
execute and deliver the Loan Documents to which it is a party and to engage in
the transactions contemplated by the Loan Documents.
34
4.2 Corporate Authority. The execution, delivery and performance by
each Borrower of the Loan Documents to which it is a party have been duly
authorized by all necessary corporate action and are not in contravention of any
material law, rule or regulation, or any judgment, decree, writ, injunction,
order or award of any arbitrator, court or governmental authority, or of the
terms of such Borrower's charter or by-laws, or of any material contract or
undertaking to which the Borrower is a party or by which the Borrower or its
property is bound or affected and do not result in the imposition of any Lien
except for Permitted Liens.
4.3 Binding Effect. The Loan Documents when delivered hereunder will
be, legal, valid and binding obligations of each Borrower party thereto
enforceable against each Borrower in accordance with their respective terms;
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to creditors' rights
and except that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to equitable defenses and to the
discretion of the court before which any proceedings may be brought.
4.4 Subsidiaries. Schedule 4.4 hereto (as updated from time to time
pursuant to Section 5.1(g) hereof) correctly sets forth the corporate name,
jurisdiction of incorporation and ownership of each Subsidiary of the Company.
Each Significant Subsidiary and each corporation becoming a Significant
Subsidiary of the Company after the date hereof is and will be a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation and is and will be duly qualified to do business
in each additional jurisdiction where such qualification is or may be necessary
under applicable law, except where the failure to be so qualified would not have
a Material Adverse Effect.
4.5 Litigation. Except as set forth in Schedule 4.5 hereto, there is no
action, suit or proceeding pending or, to the best of each Borrower's knowledge,
threatened against or affecting any Borrower or any of their respective
Subsidiaries before or by any court, governmental authority or arbitrator, which
is likely to have, either individually or collectively, a Material Adverse
Effect, and to the best of the Company's knowledge, there is no basis for any
such action, suit or proceeding.
4.6 Financial Condition. The consolidated balance sheet of the Company
and its Subsidiaries and the consolidated statements of income and cash flow of
the Company and its Subsidiaries for the fiscal year ended December 31, 2000 and
reported on by Ernst & Young LLP, independent certified public accountants, and
the interim consolidated statements of income, retained earnings and cash flow
of the Company and its Subsidiaries as of or for the six-month period ended June
30, 2001, copies of which have been furnished to the Banks, fairly present, and
the subsequent financial statements of the Company and its Subsidiaries
delivered pursuant to Section 5.1(d) will fairly present the consolidated
financial position of the Company and its Subsidiaries as at the respective
dates thereof, and the consolidated results of operations of the Company and its
Subsidiaries for the respective periods indicated, all in accordance with
generally accepted accounting principles consistently applied (subject, in the
case of said interim statements, to normal year-end adjustments and footnotes).
There has been no material adverse change in the financial condition of the
Company and its Subsidiaries taken as a whole since December 31, 2000 or, after
the Effective Date, since the date as of which the most recent audited financial
statements were prepared. There is no material known Contingent Liability of the
Company that is not reflected in such financial statements or in the notes
thereto.
4.7 Use of Loans. Each Borrower will use the proceeds of the Loans for
its general corporate purposes, including repayment of certain Indebtedness
under the 1997 Loan Agreement and Acquisitions negotiated between the Company
and prospective sellers.
35
4.8 Consents, Etc. Except for such consents, approvals, authorizations,
declarations, registrations or filings delivered by the Company pursuant to
Section 2.7(g), if any, each of which is in full force and effect, no consent,
approval or authorization of or declaration, registration or filing with any
governmental authority or any nongovernmental person, including without
limitation any creditor, lessor or stockholder of any Borrower, is required on
the part of any Borrower in connection with the execution, delivery and
performance of the Loan Documents or the transactions contemplated hereby or as
a condition to the legality, validity or enforceability of the Loan Documents,
except where the failure to obtain such consents, approvals, authorizations,
declarations, registrations or filings would not have a Material Adverse Effect.
4.9 Taxes. The Company has filed all material tax returns (federal,
state and local) required to be filed and have paid all taxes shown thereon to
be due, including interest and penalties, or have established adequate financial
reserves on their respective books and records for payment thereof, except where
the failure to file such returns, pay such taxes or establish such reserves
would not have a Material Adverse Effect.
4.10 Title to Properties. Except as otherwise disclosed in the latest
balance sheet delivered pursuant to this Agreement, the Company or one or more
of its Subsidiaries have good and marketable fee simple title to all of the real
property to the best of the Company's knowledge absent manifest error, and a
valid and indefeasible ownership interest in all of the other properties and
assets reflected in said balance sheet or subsequently acquired by the Company
or any such Subsidiary material to the business or financial condition of the
Company and its Subsidiaries taken as a whole, except for title defects that do
not have a Material Adverse Effect. All of such properties and assets are free
and clear of any Lien, except for Permitted Liens.
4.11 ERISA. The Borrowers, their respective Significant Subsidiaries,
their ERISA Affiliates and their respective Plans are in substantial compliance
in all material respects with those provisions of ERISA and of the Code which
are applicable with respect to any Plan. No Prohibited Transaction and no
Reportable Event has occurred with respect to any such Plan which would cause an
Event of Default. No Borrower, any of their respective Significant Subsidiaries
nor any of their ERISA Affiliates is an employer with respect to any
Multiemployer Plan. Except where such would not have a Material Adverse Effect,
the Borrowers, their respective Significant Subsidiaries and their ERISA
Affiliates have met the minimum funding requirements under ERISA and the Code
with respect to each of their respective Plans, if any, and have not incurred
any liability to the PBGC, other than premiums which are not yet due and
payable. The execution, delivery and performance of the Loan Documents does not
constitute a Prohibited Transaction. Except where such would not have a Material
Adverse Effect, there is no material unfunded benefit liability, determined in
accordance with Section 4001(a)(18) of ERISA, with respect to any Plan of any
Borrower, their respective Significant Subsidiaries or their ERISA Affiliates.
4.12 Environmental and Safety Matters. Except as disclosed on Schedule
4.12, to the best of each Borrower's knowledge, each Borrower and each
Subsidiary of each Borrower is in substantial compliance with all material
federal, state and local laws, ordinances and regulations relating to safety and
industrial hygiene or to the environmental condition, including without
limitation all material Environmental Laws in jurisdictions in which any
Borrower or any such Subsidiary owns or operates, or has owned or operated, a
facility or site, or arranges or has arranged for disposal or treatment of
hazardous substances, solid waste, or other wastes, accepts or has accepted for
transport any hazardous substances, solid wastes or other wastes or holds or has
held any interest in real property or otherwise, except where such would not
have a Material Adverse Effect, as of the date thereof, except as disclosed on
Schedule 4.12, no written demand, claim, notice, suit, suit in equity, action,
administrative action, investigation or inquiry whether brought by any
governmental authority, private person or otherwise, arising under, relating to
or in connection with any Environmental Laws is pending or, to the best of each
36
Borrower's knowledge, threatened against any Borrower or any such Subsidiary,
any real property in which any Borrower or any such Subsidiary holds or has held
an interest or any past or present operation of any Borrower or any such
Subsidiary which is likely to have a Material Adverse Effect. Except where such
would not have a Material Adverse Effect, neither any Borrower nor any
Subsidiary of any Borrower (a) is the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
release of any toxic substances, radioactive materials, hazardous wastes or
related materials into the environment, or (b) has received any notice of any
toxic substances, radioactive materials, hazardous waste or related materials
in, or upon any of its properties in violation of any Environmental Laws, As to
such matters disclosed on Schedule 4.12, to the best of each Borrower's
knowledge, none will have a Material Adverse Effect. Except as set forth on
Schedule 4.12, to the best of each Borrower's knowledge, no release, threatened
release or disposal of hazardous waste, solid waste or other wastes is occurring
or has occurred on, under or to any real property in which any Borrower or any
of their respective Subsidiaries holds any interest or performs any of its
operations, in material violation of any Environmental Law, except where such
would not have a Material Adverse Effect.
4.13 No Material Adverse Change. Neither the Company nor any of its
Subsidiaries has received any notice, citation or communication of the nature
referred to in Section 5.1(d)(i), except in respect of such matters as have been
or are being remediated in all material respects or are being contested or
remediated in good faith, and, in the case of any such matter being so contested
or remediated, and as of the date of this Agreement, adequate provision for all
material costs of any remediation is reflected in the financial statements
referred to in Section 4.6 of this Agreement, and in respect of any such notice,
citation or communication received after the date of this Agreement, will be
reflected in the subsequent financial statements furnished to the Agent and the
Banks pursuant to Sections 5.1(d)(ii) and 5.1(d)(iii).
4.14 No Default. No Default or Event of Default has occurred and
is continuing.
4.15 Compliance with Laws. The Company and its Subsidiaries have
complied in all material respects with all applicable laws, rules, regulations
and orders of any governmental authority, whether federal, state, local or
foreign (including without limitation ERISA, the Code and Environmental Laws),
in effect except where failure to comply would not have a Material Adverse
Effect.
ARTICLE V
COVENANTS
5.1 Affirmative Covenants. Each Borrower covenants and agrees that,
until the Termination Date and thereafter until irrevocable payment in full of
the principal of and accrued interest on the Notes, expiration or termination of
all Letters of Credit, reimbursement of any payments under Letters of Credit and
the performance of all other obligations of the Borrowers under this Agreement,
unless the Required Banks shall otherwise consent in writing, it shall, and
shall cause each of its Subsidiaries to:
(a) Preservation of Corporate Existence, Etc. Do or cause to
be done all things necessary to preserve, renew and keep in full force and
effect its legal existence, except to the extent permitted by Section 5.2(h),
and its qualification as a foreign corporation in good standing in each
jurisdiction in which such qualification is necessary under applicable law,
other than where failure to so qualify will not have a material adverse effect
on the Company and its Subsidiaries taken as a whole.
(b) Compliance with Laws, Etc. Comply in all material respects
with all applicable laws, rules, regulations and orders of any governmental
authority, whether federal, state, local or foreign (including without
limitation ERISA, the Code and Environmental Laws), in effect from time to time;
37
and pay and discharge promptly when due all taxes, assessments and governmental
charges or levies imposed upon it or upon its income, revenues or property,
before the same shall become delinquent or in default, as well as all lawful
claims for labor, materials and supplies or otherwise, which, if unpaid, might
give rise to Liens upon such properties or any portion thereof, except to the
extent that payment of any of the foregoing is then being contested in good
faith by appropriate legal proceedings, and except where failure to comply would
not have a Material Adverse Effect.
(c) Maintenance of Properties; Insurance. Maintain, preserve
and protect all property that is material to the conduct of the business of any
Borrower or any of their respective Subsidiaries and keep such property in good
repair, working order and condition and from time to time make, or cause to be
made all needful and proper repairs, renewals, additions, improvements and
replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times in accordance with
customary and prudent business practices for similar businesses; and, maintain
in full force and effect insurance with responsible and reputable insurance
companies or associations in such amounts, on such terms and covering such
risks, as is usually carried by companies engaged in similar businesses and
owning similar properties similarly situated and maintain in full force and
effect public liability insurance, insurance against claims for personal injury
or death or property damage occurring in connection with any of its activities
or any properties owned, occupied or controlled by it, in such amount as it
shall reasonably deem necessary.
(d) Reporting Requirements. Furnish to the Banks and the
Agent the following:
(i) Promptly and in any event within five
calendar days after the chief financial officer or any other senior officer
becoming aware of the occurrence of (A) any Event of Default or Default, or (B)
the commencement of any material litigation against, by or affecting any
Borrower or any of their respective Subsidiaries which the Company would be
required to report to the Securities and Exchange Commission, a statement of the
chief financial officer of the Company setting forth details of such Event of
Default or Default or such litigation and the action which such Borrower or such
Subsidiary, as the case may be, has taken and proposes to take with respect
thereto;
(ii) Within 50 days after the end of each of the
first three fiscal quarters of each fiscal year of the Company, the
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such quarter, and the related consolidated statements of income and cash flow
for the period commencing at the end of the previous fiscal year and ending with
the end of such quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding date or period of the preceding
fiscal year, all in reasonable detail and duly certified (subject to normal year
-end adjustments) by the chief financial officer of the Company as having been
prepared in accordance with generally accepted accounting principles, together
with a compliance certificate in substantially the form of Exhibit M attached
hereto signed by the chief financial officer of the Company showing the
calculations necessary to determine compliance with this Agreement and stating
that no Event of Default or Default has occurred and is continuing;
(iii) Within 90 days after the end of each fiscal
year of the Company, a copy of the consolidated balance sheet of the Company
and its Subsidiaries as of the end of such fiscal year and the related
consolidated statements of income and cash flow of the Company and its
Subsidiaries for such fiscal year, with a customary audit report of Ernst &
Young, or other nationally recognized independent certified public accountants
selected by the Company, without qualifications unacceptable to the Required
Banks, together with (A) either (I) a written statement of the accountants that
is making the examination necessary for their report or opinion they obtained no
knowledge of the occurrence of any Default or Event of Default under this
38
Agreement or (II) if they know of any Default or Event of Default, their written
disclosure of its nature and status, provided that, the accountants shall not be
liable directly or indirectly to anyone for any failure to obtain knowledge of
any Default or Event of Default under this Agreement, and (B) a compliance
certificate in substantially the form of Exhibit M attached hereto signed by the
chief financial officer of the Company showing the calculations necessary to
determine compliance with this Agreement and stating that no Event of Default or
Default has occurred and is continuing;
(iv) Promptly after the sending or filing
thereof, copies of all final reports, proxy statements and financial
statements which the Company sends to or files with any of their respective
security holders or any securities exchange or the Securities and Exchange
Commission or any successor agency thereof;
(v) Within 10 calendar days after receiving or
becoming aware thereof (A) a copy of any notice of intent to terminate any Plan
of any Borrower, their respective Significant Subsidiaries or any ERISA
Affiliate filed with the PBGC, (B) a statement of the chief financial officer of
such Borrower setting forth the details of the occurrence of any Reportable
Event with respect to any such Plan, (C) a copy of any notice that any Borrower,
any of their respective Significant Subsidiaries or any ERISA Affiliate may
receive from the PBGC relating to the intention of the PBGC to terminate any
such Plan or to appoint a trustee to administer any such Plan, or (D) a copy of
any notice of failure to make a required installment or other payment within the
meaning of Section 412(n) of the Code or Section 302(f) of ERISA with respect to
any such Plan; which, in any case, is likely to have a Material Adverse Effect;
and
(vi) Promptly, such other information
respecting the business, properties, operations or condition, financial or
otherwise, of any Borrower or any of their respective Subsidiaries as any Bank
or the Agent may from time to time reasonably request.
(e) Accounting; Access to Records, Books, Etc. Maintain a
system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in accordance
with generally accepted accounting principles and to comply with the
requirements of this Agreement and, on and after an Event of Default, at any
reasonable time and from time to time with prior notice to the Company, permit
any Bank or the Agent or any agents or representatives thereof to examine and
make copies of and abstracts from the records and books of account of, and visit
the properties of, the Borrowers and their respective Subsidiaries, and to
discuss the affairs, finances and accounts of the Borrowers and their respective
Subsidiaries with their respective directors, officers, employees and
independent auditors, provided that representatives of the Company selected by
the Company are present during any such visit or discussion, and by this
provision the Company does hereby authorize such persons to discuss such
affairs, finances and accounts with any Bank or the Agent subject to the above
terms and conditions.
(f) Stamp Taxes. The Company will pay all stamp
taxes and similar taxes, if any, including interest and penalties, if any,
payable in respect of the Notes. The efficacy of this subsection shall survive
the payment in full of the Notes.
(g) Further Assurances. Will execute and deliver within 30
days after request therefor by the Required Banks or the Agent, all further
instruments and documents and take all further action in order to give effect
to, and to aid in the exercise and enforcement of the rights and remedies of the
Banks and the Agent under, this Agreement and the Notes. In addition, the
Company may deliver to the Agent and the Banks from time to time, but no less
frequently than each anniversary of the Effective Date, supplements to Schedule
4.4 listing any Subsidiary not listed in Schedule 4.4 hereto.
39
5.2 Negative Covenants. Until the Termination Date and thereafter until
irrevocable payment in full of the principal of and accrued interest on the
Notes, expiration or termination of all Letters of Credit, reimbursement of any
payments under Letters of Credit, and the performance of all other obligations
of each Borrower under this Agreement, the Company agrees that, unless the
Required Banks shall otherwise consent in writing it shall not:
(a) Interest Coverage Ratio. Permit or suffer the
Interest Coverage Ratio to be less than 3.0 to 1.0; calculated as of the end of
each fiscal quarter for the four most recently ended fiscal quarters.
(b) Net Worth. Permit or suffer Consolidated Net Worth of the
Company and its Subsidiaries at any time to be less than the sum of (i)
$325,000,000, plus (ii) 50% of Cumulative Consolidated Net Income of the Company
and its Subsidiaries, if any, for the six-month period ending December 31, 2001
and for each fiscal year of the Company ending December 31, 2002 and thereafter,
plus (iii) 75% of the net cash proceeds received by the Company from the
issuance or other sale of its or its Subsidiaries capital stock. For the purpose
of calculating "Net Worth" under this Section 5.2(b), an amount shall be added
back to Net Worth equal to the aggregate amount of capital stock repurchases by
the Company, not to exceed $100,000,000.
(c) Total Debt to Adjusted EBITDA. Permit or suffer the ratio,
determined as of the end of each of the Company's fiscal quarters for the four
most recently ended fiscal quarters, of Consolidated Total Debt of the Company
and its Subsidiaries to Consolidated Adjusted EBITDA of the Company and its
Subsidiaries for the four most recently ended fiscal quarters to exceed 3.25 to
1.0.
(d) Liens. Create, incur or suffer to exist any Lien on any of
the assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether now owned or hereafter acquired, of the Company or any of
its Subsidiaries (except Unrestricted Margin Stock), other than:
(i) Liens for taxes not delinquent or for
taxes being contested in good faith by appropriate proceedings and as to
which adequate financial reserves have been established on its books and
records;
(ii) Liens (other than any Lien imposed by
ERISA) created and maintained in the ordinary course of business which are
not material in the aggregate, and which would not have a Material Adverse
Effect and which constitute (A) pledges or deposits under worker's compensation
laws, unemployment insurance laws or similar legislation, (B) good faith
deposits in connection with bids, tenders, contracts or leases to which the
Company or any of its Subsidiaries is a party for a purpose other than borrowing
money or obtaining credit, including rent security deposits, (C) liens imposed
by law, such as those of carriers, warehousemen and mechanics, if payment of the
obligation secured thereby is not yet due, (D) Liens securing taxes, assessments
or other governmental charges or levies not yet subject to penalties for
nonpayment, and (E) pledges or deposits to secure public or statutory
obligations of the Company or any of its Subsidiaries, or surety, customs or
appeal bonds to which the Company or any of its Subsidiaries is a party;
(iii) Liens affecting real property which
constitute minor survey exceptions or defects or irregularities in title,
minor encumbrances, easements or reservations of, or rights of others for,
rights of way, sewers, electric lines, telegraph and telephone lines and other
similar purposes, or zoning or other restrictions as to the use of such real
property, provided that all of the foregoing, in the aggregate, do not at any
time materially detract from the value of said properties or materially impair
their use in the operation of the businesses of the Company and its Subsidiaries
taken as a whole;
40
(iv) Liens existing on the date hereof upon the
same terms as the date hereof, but no extensions, renewals and replacements
thereof shall be permitted, with each existing Lien securing Indebtedness in
excess of $5,000,000 described in Schedule 5.2(d) hereto;
(v) Liens granted by any Subsidiary in
favor of the Company or any other Subsidiary;
(vi) The interest or title of a lessor under any
lease otherwise permitted under this Agreement with respect to the property
subject to such lease to the extent performance of the obligations of the
Company or its Subsidiary thereunder is not delinquent;
(vii) Liens existing on property at the time of
its acquisition (other than any such Lien created in contemplation of such
acquisition), provided that the Company promptly forwards a schedule of such
Liens to the Agent after any such acquisition;
(viii) Liens incurred in connection with any
transfer of an interest in accounts or notes receivable and related assets which
transfer is permitted pursuant to Section 5.2(f) and which Liens are required to
consummate such Permitted Securitization Transaction; and
(ix) Liens, other than Liens described in
clauses (i) through (viii) above, securing Indebtedness in an aggregate
amount not to exceed 10% of Consolidated Net Worth.
(e) Merger; Etc. Merge or consolidate with any other person or
take any other action having a similar effect (other than an Acquisition which
is governed by Section 5.2(n) hereof), provided, however, (i) a Subsidiary of
the Company may merge with the Company, provided that the Company shall be the
surviving corporation, (ii) a Subsidiary of the Company may merge or consolidate
with another Subsidiary of the Company and (iii) this Section 5.2(e) shall not
prohibit any merger if the Company shall be the surviving or continuing
corporation and, immediately after such merger, no Default or Event of Default
shall exist or shall have occurred and be continuing.
(f) Disposition of Assets; Etc. Sell, lease, license,
transfer, assign or otherwise dispose of all or a substantial portion of its
business, assets, rights, revenues or property, real, personal or mixed,
tangible or intangible, whether in one or a series of transactions, other than
inventory sold in the ordinary course of business upon customary credit terms
and sales of scrap or obsolete material or equipment and Unrestricted Margin
Stock, provided, however, that this Section 5.2(f) shall not prohibit:
(i) Any sale, conveyance or other transfer
of an interest in accounts or notes receivable and related assets on a limited
recourse basis, the terms of which are reasonably acceptable to the Agent,
provided that (a) such transfer qualifies as a sale under generally accepted
accounting principles, and (b) the aggregate amount of such financing does not
exceed $125,000,000 at any one time outstanding (any such sale or other
transfer, a "Permitted Securitization Transaction"); or
(ii) Any other such sale, lease, license,
transfer, assignment or other disposition if the aggregate book value
(disregarding any write-downs of such book value other than ordinary
depreciation and amortization) of all of the business, assets, rights, revenues
and property disposed of after the date of this Agreement shall be less than 25%
of the Consolidated Net Worth of the Company and its Subsidiaries, and if
immediately after such transaction, no Default or Event of Default shall exist
or shall have occurred and be continuing.
(g) Nature of Business. Engage in any business if, as a
result, the general nature of the business, taken on a consolidated basis, which
41
would then be engaged in by the Company and its Subsidiaries would be
substantially changed from the general nature of the business engaged in by the
Company and its Subsidiaries on the date of this Agreement which is the
manufacture, sale or lease of home medical and extended care equipment and
related products.
(h) Negative Pledge Limitation. Enter into any agreement, with
any person, other than the Banks pursuant hereto or pursuant to the 364-Day
Credit Agreement, which prohibits or limits the ability of any Borrower or any
Guarantor to create, incur, assume or suffer to exist any Lien upon any of its
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether now owned or hereafter acquired, other than (i) agreements
evidencing Indebtedness in an aggregate amount less than $5,000,000, (ii) any
Indebtedness assumed in connection with any acquisition (provided that the
Company shall provide notice to the Agent upon the assumption of any
Indebtedness in an aggregate amount exceeding $5,000,000 containing any such
prohibition or limitation), but no renewal of such assumed Indebtedness
containing such restriction shall be permitted and (iii) limitations on any
Securitization Entity in any agreement executed in connection with any Permitted
Securitization Transaction.
(i) Limitations on Indebtedness of Subsidiaries.
(i) Other than Advances to Borrowing Subsidiaries
hereunder and under the 364-Day Credit Agreement and other than any
Indebtedness of any Subsidiary under any Permitted Securitization Transaction,
permit the sum of the aggregate principal amount of all Total Debt of its
Subsidiaries (determined on a consolidated basis eliminating inter-company items
among the Company and its Subsidiaries) to exceed $25,000,000.
(ii) Any corporation which becomes a Subsidiary
after the date hereof shall for all purposes of this Section 5.2(i) be deemed to
have created, assumed or incurred, at the time it becomes a Subsidiary, all
Consolidated Total Debt of such corporation existing immediately after it
becomes a Subsidiary.
(j) Investments. Make any Investments, other than:
(i) Investments by the Company and its
Subsidiaries in and to Subsidiaries, including any Investment in a
corporation which, after giving effect to such Investment, will become a
Subsidiary and including any Investment in any Securitization Entity;
(ii) Investments in commercial paper maturing
in 270 days or less from the date of issuance which, at the time of acquisition
by the Company or any Subsidiary, is accorded the highest rating by S&P or
▇▇▇▇▇'▇ (or another nationally recognized credit rating agency of similar
standing if neither of such corporations is then in the business of rating
commercial paper);
(iii) Investments in direct obligations of the
United States of America or any agency or instrumentality of the United
States of America, the payment or guarantee of which constitutes a full faith
and credit obligation of the United States of America, in either case, maturing
in twelve months or less from the date of acquisition thereof;
(iv) Investments in certificates of deposit
maturing within one year from the date of issuance thereof, issued by (and
banker's acceptances endorsed by) a bank or trust company organized under the
laws of the United States or any state thereof, having capital, surplus and
undivided profits aggregating at least $100,000,000 and whose long-term
certificates of deposit are, at the time of acquisition thereof by the Company
or a Subsidiary, rated AA or better by S&P or Aa or better by ▇▇▇▇▇'▇ (or an
42
equivalent rating by another nationally recognized credit rating agency of
similar standing if neither of such corporations is then in the business of
rating certificates of deposit);
(v) Investments in repurchase agreements
maturing within one year from the date of issuance thereof entered into with a
bank or trust company of the type described in clause (iv) above;
(vi) Investments in tax-exempt floating rate
optional tender bonds backed by a letter of credit issued by a bank or trust
company of the type described in clause (iv) above;
(vii) loans or advances in the usual and
ordinary course of business to officers, directors and employees for expenses
(including moving expenses related to a transfer) incidental to carrying on
the business of the Company or any Subsidiary;
(viii) receivables arising from the sale of goods
and services in the ordinary course of business of the Company and its
Subsidiaries;
(ix) Investments in money market preferred
stock rated "A" or better by S&P or "a" or better by ▇▇▇▇▇'▇ (or an equivalent
rating by another nationally recognized credit rating agency of similar standing
if neither of such corporations is then in the business of rating such preferred
stock);
(x) Investments existing on the Effective
Date which are described on Schedule 5.2(j); and
(xi) Other Investments which do not exceed in
the aggregate an amount equal to 10% of Consolidated Net Worth.
In valuing any Investments for the purpose of applying the
limitations set forth in this Section 5.2(j), such Investments shall be taken at
the original cost thereof, without allowance for any subsequent write-offs or
appreciation or depreciation therein, but less any amount repaid or recovered on
account of capital or principal.
For purposes of this Section 5.2(j), at any time when a
corporation becomes a Subsidiary, all Investments of such corporation at such
time shall be deemed to have been made by such corporation, as a Subsidiary, at
such time.
(k) Contingent Liabilities. Will not, and will not permit any
Subsidiary to, become or be liable in respect of any Contingent Liabilities
except Contingent Liabilities by the Company which are limited in amount to a
stated maximum dollar exposure or which constitute Contingent Liabilities of
obligations incurred by any Subsidiary in compliance with and not in violation
of the provisions of this Agreement and Contingent Liabilities of Subsidiaries
of the Company to the extent permitted by Section 5.2(i) and which, in all
cases, are in furtherance of a business purpose of the Company or its
Subsidiaries.
(l) Transactions with Affiliates. Will not, and will not
permit any Subsidiary to, enter into or be a party to any transaction or
arrangement with any Affiliate (including, without limitation, the purchase
from, sale to or exchange of property with, or the rendering of any service by
or for, any Affiliate), except (i) in the ordinary course of and pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such Subsidiary
than would obtain in a comparable arm's-length transaction with a Person other
than an Affiliate and (ii) any transactions between the Company or any
Subsidiary and any other Subsidiary which are required to consummate a Permitted
Securitization Transaction.
43
(m) Additional Covenants. If at any time the Company or any
Subsidiary shall enter into any agreement relating to or amending any terms or
conditions applicable to any of its Indebtedness in excess of $25,000,000 which
includes covenants or defaults not substantially provided for in this Agreement
or more favorable to the lender or lenders thereunder than those provide for in
this Agreement, then the Company shall promptly so advise the Agent and the
Banks. Thereupon if the Required Banks shall request, upon notice to the
Company, the Borrowers and the Banks shall enter into an Amendment to this
Agreement providing for substantially the same covenants, defaults and other
terms and conditions as those provided for in such agreement to the extent
required and as may be selected by the Required Banks. In addition to the
foregoing, any covenants or defaults or similar provisions (which include
without limitation any provisions requiring any mandatory prepayments or
defeasance) contained in the Senior Unsecured Notes or any agreements or
instruments executed in connection therewith not substantially provided for in
this Agreement or more favorable to the holders of the obligations issued in
connection therewith are hereby incorporated by reference into this Agreement to
the same extent as if set forth fully herein, and no subsequent amendment,
waiver, termination or modification thereof shall affect any such covenants,
terms, conditions or defaults as incorporated herein.
(n) Acquisitions. Make any Acquisition; provided, however,
that this Section 5.2(n) shall not prohibit any Acquisition if (a) immediately
before and after (on a pro forma basis acceptable to the Agent and supported by
such certificates and opinions reasonably required by the Agent) such
Acquisition: (i) no Default or Event of Default shall exist or shall have
occurred and be continuing, (ii) the representations and warranties contained in
the Loan Documents shall be true and correct in all material respects as if made
on the date such Acquisition is consummated, (iii) the Consolidated Total Debt
to Consolidated Adjusted EBITDA Ratio is not greater than 3.00 to 1.0, on a pro
forma basis after giving effect to the Acquisition and (iv) the Company or a
Subsidiary shall be the surviving entity, (b) not less than 10 Business Days
prior to the consummation of such Acquisition, the Company shall have provided
to the Banks a certificate of the chief financial officer of the Company
(attaching pro forma financial statements and computations to demonstrate
compliance and projected compliance with all covenants and conditions
hereunder), stating that such Acquisition complies with this Section 5.2(n),
customary legal opinions acceptable to the Agent, evidence satisfactory to the
Agent that such Acquisition is in compliance with all laws and regulations and
that any other conditions under this Agreement relating to such transaction have
been satisfied, all in form and substance reasonably satisfactory to the Agent.
ARTICLE VI
DEFAULT
6.1 Events of Default. The occurrence of any one of the following
events or conditions shall be deemed an "Event of Default" hereunder unless
waived by the Required Banks or the Banks, as required pursuant to Section 8.1:
(a) Nonpayment of Principal. Any Borrower shall fail
to pay when due any principal of the Notes; or
(b) Nonpayment of Interest. Any Borrower shall fail
to pay when due any interest or any fees or any other amount payable hereunder
and such failure shall remain unremedied for five days; or
(c) Misrepresentation. Any representation or warranty made by
any Borrower in Article IV hereof, any other Loan Document or any other
certificate, report, financial statement or other document furnished by or on
behalf of any Borrower in connection with this Agreement shall prove to have
been incorrect in any material respect when made or deemed made; or
44
(d) Certain Covenants. Any Borrower shall fail to
perform or observe any term, covenant or agreement contained in Section 5.1(d)
(i)(A) or Section 5.2(a), (b), (c), (e) or (f) hereof; or
(e) Other Defaults. Any Borrower shall fail to
perform or observe any other term, covenant or agreement contained in this
Agreement or any other Loan Document, and any such failure shall remain
unremedied for 30 calendar days; or
(f) Cross Default. Any Borrower or any of their respective
Subsidiaries shall fail to pay any part of the principal of, the premium, if
any, or the interest on, or any other payment of money due under any of its
Indebtedness (other than Indebtedness hereunder), beyond any period of grace
provided with respect thereto, which individually or together with other such
Indebtedness as to which any such failure exists has an aggregate outstanding
principal amount in excess of $10,000,000; or any Borrower or any of their
respective Subsidiaries shall fail to perform or observe any other term,
covenant or agreement contained in any agreement, document or instrument
evidencing or securing any such Indebtedness having such aggregate outstanding
principal amount, or under which any such Indebtedness was issued or created,
beyond any period of grace, if any, provided with respect thereto and such
Borrower or such Subsidiary has been notified by the creditor of such default;
and the effect of any such failure is either (i) to cause, or permit the holders
of such Indebtedness (or a trustee on behalf of such holders) to cause, any
payment of such Indebtedness to become due prior to its due date or (ii) to
permit the holders of such Indebtedness (or a trustee on behalf of such holders)
to elect a majority of the board of directors of the Company; or
(g) Judgments. One or more judgments or orders shall be
rendered against or shall affect any Borrower or any of their respective
Subsidiaries which causes or is likely to cause a material adverse change in the
financial condition of the Company and its Subsidiaries taken as a whole or
which does or could have a Material Adverse Effect, and either (i) such judgment
or order shall have remained unsatisfied or uninsured for a period of 21 days
and such Borrower or such Subsidiary shall not have taken action necessary to
stay enforcement thereof by reason of pending appeal or otherwise, prior to the
expiration of the applicable period of limitations for taking such action or, if
such action shall have been taken, a final order denying such stay shall have
been rendered, or (ii) enforcement proceedings shall have been commenced by any
creditor upon any such judgment or order; or
(h) ERISA. The occurrence of a Reportable Event that results
in or could result in material liability of any Borrower, any Significant
Subsidiary of any Borrower or their ERISA Affiliates to the PBGC or to any Plan
and such Reportable Event is not corrected within thirty (30) days after the
occurrence thereof; or except where such would not have a Material Adverse
Effect, the occurrence of any Reportable Event which is likely to constitute
grounds for termination of any Plan of any Borrower, their respective
Significant Subsidiaries or their ERISA Affiliates by the PBGC or for the
appointment by the appropriate United States District Court of a trustee to
administer any such Plan and such Reportable Event is not corrected within
thirty (30) days after the occurrence thereof; or except where such would not
have a Material Adverse Effect, the filing by any Borrower, any Significant
Subsidiary of any Borrower or any of their ERISA Affiliates of a notice of
intent to terminate a Plan or the institution of other proceedings to terminate
a Plan; or any Borrower, any Significant Subsidiary of any Borrower or any of
their ERISA Affiliates shall fail to pay when due any material liability to the
PBGC or to a Plan; or except where such would not have a Material Adverse
Effect, the PBGC shall have instituted proceedings to terminate, or to cause a
trustee to be appointed to administer, any Plan of any Borrower, their
respective Significant Subsidiaries or their ERISA Affiliates; or any person
engages in a Prohibited Transaction with respect to any Plan which results in or
could result in material liability of the any Borrower, any Significant
Subsidiary of any Borrower, any of their ERISA Affiliates, any Plan of any
Borrower, their respective Significant Subsidiaries or their ERISA Affiliates or
45
fiduciary of any such Plan; or except where such would not have a Material
Adverse Effect, failure by any Borrower, any Significant Subsidiary of any
Borrower or any of their ERISA Affiliates to make a required installment or
other payment to any Plan within the meaning of Section 302(f) of ERISA or
Section 412(n) of the Code that results in or could result in liability of any
Borrower, any Significant Subsidiary of any Borrower or any of their ERISA
Affiliates to the PBGC or any Plan; or except where such would not have a
Material Adverse Effect, the withdrawal of any Borrower, any of their respective
Significant Subsidiaries or any of their ERISA Affiliates from a Plan during a
plan year in which it was a "substantial employer" as defined in Section
4001(9a)(2) of ERISA; or any Borrower, any of their respective Significant
Subsidiaries or any of their ERISA Affiliates becomes an employer with respect
to any Multiemployer Plan without the prior written consent of the Required
Banks; or
(i) Insolvency, Etc. Any Borrower shall be dissolved or
liquidated (or any judgment, order or decree therefor shall be entered), except
as otherwise provided pursuant to Section 5.2(e), or shall generally not pay its
debts as they become due, or shall admit in writing its inability to pay its
debts generally, or shall make a general assignment for the benefit of
creditors, or shall institute, or there shall be instituted against any
Borrower, any proceeding or case seeking to adjudicate it a bankrupt or
insolvent or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief or protection of
debtors or seeking the entry of an order for relief, or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its assets, rights, revenues or property, and, if such
proceeding is instituted against any Borrower and is being contested by such
Borrower in good faith by appropriate proceedings, such proceeding shall remain
undismissed or unstayed for a period of 60 days or any writ or warrant of
attachment or execution or similar process is issued or levied against all or
any material part of the property of any Borrower and is not released, vacated
or fully bonded within 60 days after its issue or levy; or any Borrower shall
take any action (corporate or other) to authorize or further any of the actions
described above in this subsection; provided, however, that none of the
foregoing acts or occurrences in this Section 6.1(i) with respect to any
Borrowing Subsidiary shall constitute an Event of Default so long as there are
no Advances outstanding to such Borrowing Subsidiary at the time of such act or
occurrence, provided, that, the Commitment of the Banks to such Borrowing
Subsidiary shall automatically terminate without notice; or
(j) Change of Control. The Company shall experience a Change
of Control. For purposes of this Section 6.1(j), a "Change of Control" shall
occur if during any twelve-month period any person or group of persons (within
the meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as
amended) shall have acquired beneficial ownership (within the meaning of Rule
13D-3 promulgated by the Securities and Exchange Commission under said Act) of
50% or more in voting power of the voting shares of the Company that were
outstanding as of the date of this Agreement; or
(k) 364-Day Credit Agreement. Any Event of Default (as defined
in the 364-Day Credit Agreement) shall occur and be continuing under the 364-Day
Credit Agreement.
(l) Loan Documents. Any Loan Document shall fail to remain
in full force and effect or any action shall be taken by any Borrower or any
Guarantor to discontinue or to assert the invalidity or unenforceability of any
Loan Document.
6.2 Remedies.
(a) Upon the occurrence and during the continuance of any
Event of Default, the Agent shall, upon being directed to do so by the Required
Banks, by notice to the Company (i) terminate the Commitments and/or (ii)
declare the outstanding principal of, and accrued interest on, the Notes and all
46
other amounts owing under this Agreement to be immediately due and payable,
and/or (iii) demand immediate delivery of cash collateral, and the Borrowers
agree to deliver such cash collateral upon demand, in an amount equal to the
maximum amount that may be available to be drawn at any time prior to the stated
expiry of all outstanding Letters of Credit, or any one or more of the
foregoing, whereupon the Commitments shall terminate forthwith and all such
amounts, including cash collateral, shall become immediately due and payable,
provided that in the case of any event or condition described in Section 6.1(i)
with respect to any Borrower, the Commitments shall automatically terminate
forthwith and all such amounts, including cash collateral, shall automatically
become immediately due and payable without notice; in all cases without demand,
presentment, protest, diligence, notice of dishonor or other formality, all of
which are hereby expressly waived. Such cash collateral delivered in respect of
outstanding Letters of Credit shall be deposited in a special cash collateral
account to be held by the Agent as collateral security for the payment and
performance of the Borrowers' obligations under this Agreement to the Banks and
the Agent.
(b) The Agent shall, upon being directed to do so by the
Required Banks, in addition to the remedies provided in Section 6.2(a), exercise
and enforce any and all other rights and remedies available to it or the Banks,
whether arising under this Agreement, the Notes or under applicable law, in any
manner deemed appropriate by the Agent, including suit in equity, action at law,
or other appropriate proceedings, whether for the specific performance (to the
extent permitted by law) of any covenant or agreement contained in this
Agreement or in the Notes or in aid of the exercise of any power granted in this
Agreement or the Notes.
(c) Upon the occurrence and during the continuance of any
Event of Default, each Bank may at any time and from time to time exercise any
of its rights of set off or bankers lien that it may possess by common law or
statute without prior notice to the Borrowers, provided that each Bank may also
set off against any deposit whether or not it is then matured. Each Bank agrees
to promptly notify the Company after any such setoff and application, provided
that the failure to give such notice shall not effect the validity of such
setoff and application. The rights of such Bank under this Section 6.2(c) are in
addition to other rights and remedies which such Bank may have.
ARTICLE VII
THE AGENT AND THE BANKS
7.1 Appointment and Authorization. Each Bank hereby irrevocably
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Agreement and the Notes as are delegated to
the Agent by the terms hereof or thereof, together with all such powers as are
reasonably incidental thereto. The provisions of this Article VII are solely for
the benefit of the Agent and the Banks, and the Borrowers shall not have any
rights as a third party beneficiary of any of the provisions hereof. In
performing its functions and duties under this Agreement, the Agent shall act
solely as agent of the Banks and does not assume and shall not be deemed to have
assumed any obligation towards or relationship of agency or trust with or for
the Borrowers.
7.2 Agent and Affiliates. Bank One, Michigan in its capacity as a Bank
hereunder shall have the same rights and powers hereunder as any other Bank and
may exercise or refrain from exercising the same as though it were not the
Agent. Bank One, Michigan and its affiliates may (without having to account
therefor to any Bank) accept deposits from, lend money to, and generally engage
in any kind of banking, trust, financial advisory or other business with any
Borrower or any Subsidiary of any Borrower as if it were not acting as Agent
hereunder, and may accept fees and other consideration therefor without having
to account for the same to the Banks.
47
7.3 Scope of Agent's Duties. The Agent shall have no duties or
responsibilities except those expressly set forth herein, and shall not, by
reason of this Agreement, have a fiduciary relationship with any Bank, and no
implied covenants, responsibilities, duties, obligations or liabilities shall be
read into this Agreement or shall otherwise exist against the Agent. As to any
matters not expressly provided for by this Agreement (including, without
limitation, collection and enforcement actions under the Notes), the Agent shall
not be required to exercise any discretion or take any action, but the Agent
shall take such action or omit to take any action pursuant to the written
instructions of the Required Banks and may request instructions from the
Required Banks. The Agent shall in all cases be fully protected in acting, or in
refraining from acting, pursuant to the written instructions of the Required
Banks, which instructions and any action or omission pursuant thereto shall be
binding upon all of the Banks; provided, however, that the Agent shall be fully
justified in failing or refusing to take any action hereunder and under any
other Loan Document unless it shall first be indemnified to its satisfaction by
the Banks pro rata against any and all liability, cost and expense that it may
incur by reason of taking or continuing to take any such action.
7.4 Reliance by Agent. The Agent shall be entitled to rely upon any
certificate, notice, document or other communication (including any cable,
telegram, telex, facsimile transmission or oral communication) believed by it to
be genuine and correct and to have been sent or given by or on behalf of a
proper person. The Agent may treat the payee of any Note as the holder thereof
unless and until the Agent receives written notice of the assignment thereof
pursuant to the terms of this Agreement signed by such payee and the Agent
receives the written agreement of the assignee that such assignee is bound
hereby to the same extent as if it had been an original party hereto. The Agent
may employ agents (including without limitation collateral agents) and may
consult with legal counsel (who may be counsel for the Borrowers), independent
public accountants and other experts selected by it and shall not be liable to
the Banks, except as to money or property received by it or its authorized
agents, for the negligence or misconduct of any such agent selected by it with
reasonable care or for any action taken or omitted to be taken by it in good
faith in accordance with the advice of such counsel, accountants or experts.
7.5 Default. The Agent shall not be deemed to have knowledge of the
occurrence of any Default or Event of Default, except with respect to defaults
in the payment of principal, interest and fees required to be paid to the Agent
for the account of the Banks, unless the Agent has received written notice from
a Bank or a Borrower specifying such Default or Event of Default and stating
that such notice is a "Notice of Default". In the event that the Agent receives
such a notice, the Agent shall give prompt written notice thereof to the Banks.
7.6 Liability of Agent. Neither the Agent nor any of its directors,
officers, agents, or employees shall be liable to the Banks for any action taken
or not taken by it or them in connection herewith with the consent or at the
request of the Required Banks or in the absence of its or their own gross
negligence or willful misconduct. Except for duties expressly accepted by the
Agent hereunder, neither the Agent nor any of its directors, officers, agents or
employees shall be responsible for or have any duty to ascertain, inquire into
or verify (i) any recital, statement, warranty or representation contained in
this Agreement or any Note or any Guaranty, or in any certificate, report,
financial statement or other document furnished in connection with this
Agreement, (ii) the performance or observance of any of the covenants or
agreements of any Borrower or any Guarantor, (iii) the satisfaction of any
condition specified in Article II hereof, or (iv) the validity, effectiveness,
legal enforceability, value or genuineness of this Agreement or the Notes or any
collateral subject thereto or any other instrument or document furnished in
connection herewith.
7.7 Nonreliance on Agent and Other Banks. Each Bank acknowledges and
agrees that it has, independently and without reliance on the Agent or any other
48
Bank, and based on such documents and information as it has deemed appropriate,
made its own credit analysis of the Borrowers and decision to enter into this
Agreement and that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decision in
taking or not taking action under this Agreement. The Agent shall not be
required to keep itself informed as to the performance or observance by any
Borrower or any Guarantor of this Agreement, the Notes or any other documents
referred to or provided for herein or to inspect the properties or books of any
Borrower or any Guarantor and, except for notices, reports and other documents
and information expressly required to be furnished to the Banks by the Agent or
any Borrower hereunder, the Agent shall not have any duty or responsibility to
provide any Bank with any information concerning the affairs, financial
condition or business of the Borrowers or any of their respective Subsidiaries
which may come into the possession of the Agent or any of its affiliates.
7.8 Indemnification. The Banks agree to indemnify the Agent (to the
extent not reimbursed by the Borrowers, but without limiting any obligation of
the Borrowers to make such reimbursement), ratably according to the respective
principal amounts of the Advances then outstanding made by each of them (or if
no Advances are at the time outstanding, ratably according to the respective
amounts of their Commitments), from and against any and all claims, damages,
losses, liabilities, costs or expenses of any kind or nature whatsoever
(including, without limitation, fees and disbursements of counsel) which may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or the transactions contemplated hereby or any
action taken or omitted by the Agent under this Agreement, provided, however,
that no Bank shall be liable for any portion of such claims, damages, losses,
liabilities, costs or expenses resulting from the Agent's gross negligence or
willful misconduct. Without limitation of the foregoing, each Bank agrees to
reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including without limitation fees and expenses of
counsel) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, to the extent that
the Agent is not reimbursed for such expenses by the Borrowers, but without
limiting the obligation of the Borrowers to make such reimbursement. Each Bank
agrees to reimburse the Agent promptly upon demand for its ratable share of any
amounts owing to the Agent by the Banks pursuant to this Section.
7.9 Resignation of Agent. The Agent may resign as such at any time upon
thirty days' prior written notice to the Borrowers and the Banks. In the event
of any such resignation, the Company shall, by an instrument in writing
delivered to the Banks and the Agent, appoint a successor, which shall be a Bank
or any other commercial bank organized under the laws of the United States or
any State thereof and having a combined capital and surplus of at least
$500,000,000; provided, that, if an Event of Default has occurred and is
continuing at the time of such resignation, the Required Banks shall have the
right to appoint, on behalf of the Borrowers and the Banks, the successor agent.
If a successor is not so appointed or does not accept such appointment before
the Agent's resignation becomes effective, the resigning Agent may appoint a
temporary successor to act until such appointment by the Company is made and
accepted any successor to the Agent shall execute and deliver to the Borrowers
and the Banks an instrument accepting such appointment and thereupon such
successor Agent, without further act, deed, conveyance or transfer shall become
vested with all of the properties, rights, interests, powers, authorities and
obligations of its predecessor hereunder with like effect as if originally named
as Agent hereunder. Upon request of such successor Agent, the Borrowers and the
resigning Agent shall execute and deliver such instruments of conveyance,
assignment and further assurance and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in such successor
Agent all such properties, rights, interests, powers, authorities and
obligations. The provisions of this Article VII shall thereafter remain
effective for such resigning Agent with respect to any actions taken or omitted
to be taken by such Agent while acting as the Agent hereunder.
49
7.10 Sharing of Payments. The Banks agree among themselves that, in the
event that any Bank shall obtain payment in respect of any Advance or any other
obligation owing to the Banks under this Agreement through the exercise of a
right of set-off, banker's lien, counterclaim or otherwise in excess of its
ratable share of payments received by all of the Banks on account of the
Advances and other obligations (or if no Advances are outstanding, ratably
according to the respective amounts of the Commitments), such Bank shall
promptly purchase from the other Banks participations in such Advances and other
obligations in such amounts, and make such other adjustments from time to time,
as shall be equitable to the end that all of the Banks share such payment in
accordance with such ratable shares. The Banks further agree among themselves
that if payment to a Bank obtained by such Bank through the exercise of a right
of set-off, banker's lien, counterclaim or otherwise as aforesaid shall be
rescinded or must otherwise be restored, each Bank which shall have shared the
benefit of such payment shall, by repurchase of participations theretofore sold,
return its share of that benefit to each Bank whose payment shall have been
rescinded or otherwise restored. The Borrowers agree that any Bank so purchasing
such a participation may, to the fullest extent permitted by law, exercise all
rights of payment, including set-off, banker's lien or counterclaim, with
respect to such participation as fully as if such Bank were a holder of such
Advance or other obligation in the amount of such participation. The Banks
further agree among themselves that, in the event that amounts received by the
Banks and the Agent hereunder are insufficient to pay all such obligations or
insufficient to pay all such obligations when due, the fees and other amounts
owing to the Agent in such capacity shall be paid therefrom before payment of
obligations owing to the Banks under this Agreement, other than agency fees
payable pursuant to Section 2.5(d) of this Agreement which shall be paid on a
pro rata basis with amounts owing to the Banks. Except as otherwise expressly
provided in this Agreement, if any Bank or the Agent shall fail to remit to the
Agent or any other Bank an amount payable by such Bank or the Agent to the Agent
or such other Bank pursuant to this Agreement on the date when such amount is
due, such payments shall be made together with interest thereon for each date
from the date such amount is due until the date such amount is paid to the Agent
or such other Bank at a rate per annum equal to the rate at which borrowings are
available to the payee in its overnight federal funds market. It is further
understood and agreed among the Banks and the Agent that if the Agent or any
Bank shall engage in any other transactions with any Borrower and shall have the
benefit of any collateral or security therefor which does not expressly secure
the obligations arising under this Agreement except by virtue of a so-called
dragnet clause or comparable provision, the Agent or such Bank shall be entitled
to apply any proceeds of such collateral or security first in respect of the
obligations arising in connection with such other transaction before application
to the obligations arising under this Agreement.
7.11 Withholding Tax Exemption. (a) Each Bank that is not organized and
incorporated under the laws of the United States or any State thereof agrees to
file with the Agent and the Company, in duplicate, (i) on or before the later of
(A) the Effective Date and (B) the date such Bank becomes a Bank under this
Agreement and (ii) thereafter, renewals or additional copies of such form (or
any successor form) on or before the date such form expires or becomes obsolete,
unless not legally able to do so as a result of a change in United States income
tax enacted, or treaty promulgated, after the date specified in the preceding
clause (i), on or prior to the immediately following due date of any payment by
the Company hereunder, a properly completed and executed copy of either Internal
Revenue Service Form W-8BEN or Internal Revenue Service Form W-8ECI and Internal
Revenue Service Form W-8 or Internal Revenue Service Form W-9 and any additional
form necessary for claiming complete exemption from United States withholding
taxes (or such other form as is required to claim complete exemption from Unites
States withholding taxes), if and as provided by the Internal Revenue Code or
other pronouncements of the United States Internal Revenue Service, and such
Bank warrants to the Company that the form so filed will be true and complete;
provided that such Bank's failure to complete and execute such Form W-8BEN or
Form W-8ECI, or Form W-8 or Form W-9, as the case may be, and any such
additional form (or any successor form or forms) shall not relieve the Company
50
of any of its obligations under this Agreement, except as otherwise provided in
this Section 7.11.
(b) Prior to making any Loan denominated in Pounds, each Bank
that is making any portion of such Loan and that is neither a resident of the
United Kingdom nor a bank carrying on a bona fide banking business in the United
Kingdom agrees to furnish to the Agent and the Company evidence satisfactory to
the Agent and the Company that such Bank has filed with the United Kingdom
Inland Revenue a "Claim on Behalf of a United States Domestic Corporation to
Relief from United Kingdom Income Tax on Interest and Royalties Arising in the
United Kingdom" or other appropriate form or forms of exemption from withholding
tax and received from the Inland Revenue authority that payments to such Bank by
any Borrower hereunder may be made gross; provided that such Bank's failure to
furnish such evidence shall not relieve any Borrower of its obligations under
this Agreement, except as otherwise provided in this Section 7.11. Upon an Event
of Default, each Bank which is neither a resident of the United Kingdom nor a
bank carrying on a bona fide banking business in the united Kingdom agrees to
furnish, as soon as practicable, to the Agent and the Company evidence
satisfactory to the Agent and the Company that such Bank has filed with the
United Kingdom Inland Revenue a claim on behalf of a United States Domestic
Corporation to Relief from United Kingdom Income Tax on Interest and Royalties
Arising in the United Kingdom or other appropriate form or forms of exemption
from withholding tax and received form the Inland Revenue authority that
payments to such Bank by the Company hereunder may be made gross; provided that
such Bank's failure to furnish such evidence shall not relieve any Borrower of
its obligations under this Agreement, except as otherwise provided in this
Section 7.11.
7.12 Co-Agent, Documentation Agents, Syndication Agent, Etc. No Bank
identified in this Agreement as a "co-agent", "documentation agent" or
"syndication agent" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Banks as such. Without limiting the foregoing, none of such Banks shall have or
be deemed to have a fiduciary relationship with any Bank. Each Bank hereby makes
the same acknowledgments with respect to such Banks as it makes with respect to
the Agent in Section 7.7.
ARTICLE VIII
MISCELLANEOUS
8.1 Amendments, Etc.
(a) No amendment, modification, termination or waiver of any
provision of this Agreement nor any consent to any departure therefrom shall be
effective unless the same shall be in writing and signed by the Borrowers and
the Required Banks and, to the extent any rights or duties of the Agent may be
affected thereby, the Agent, provided, however, that no such amendment,
modification, termination, waiver or consent shall, without the consent of the
Agent and all of the Banks, (i) authorize or permit the extension of time for,
or any reduction of the amount of, any payment of the principal of, or interest
on, the Advances or any Letter of Credit reimbursement obligation, or any fees
or other amount payable hereunder, (ii) amend or terminate the respective
Commitment of any Bank set forth on Schedule 1.1 (except as provided in Section
2.1(g)) or modify the provisions of this Section regarding the taking of any
action under this Section or the provisions of Section 7.10, Section 8.6(a) or
the definition of Required Banks or (iii) amend or modify the Guaranty (other
than any amendment solely for the purpose of adding or deleting a Borrowing
Subsidiary) or provide for the release or discharge of the Company's obligations
under the Guaranty.
(b) Any such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
51
(c) Notwithstanding anything herein to the contrary, no Bank
that is in default of any of its obligations, covenants or agreements under this
Agreement shall be entitled to vote (whether to consent or to withhold its
consent) with respect to any amendment, modification, termination or waiver of
any provision of this Agreement or any departure therefrom or any direction from
the Banks to the Agent, and, for purposes of determining the Required Banks at
any time when any Bank is in default under this Agreement, the Commitments and
Advances of such defaulting Banks shall be disregarded.
8.2 Notices.
(a) Except as otherwise provided in Section 8.2(c) hereof, all
notices and other communications hereunder shall be in writing and shall be
delivered or sent to the Borrowers in case of the Treasury Manager at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer, Facsimile
No. (▇▇▇) ▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇ or ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇ and to the
Agent and the Banks at the respective addresses and numbers for notices set
forth on the signatures pages hereof, or to such other address as may be
designated by any Borrower, the Agent or any Bank by notice to the other parties
hereto. All notices and other communications shall be deemed to have been given
at the time of actual delivery thereof to such address, or if sent by certified
or registered mail, postage prepaid, to such address, on the third day after the
date of mailing, or if deposited prepaid with Federal Express or other
nationally recognized overnight delivery service prior to the deadline for next
day delivery, on the Business Day next following such deposit, provided,
however, that notices to the Agent shall not be effective until received.
(b) Notices by the Treasury Manager or a Borrower to the Agent
with respect to terminations or reductions of the Commitments pursuant to
Section 2.4, requests for Advances pursuant to Section 2.6, requests for
continuations or conversions of Loans pursuant to Section 2.9 and notices of
prepayment pursuant to Section 3.1 shall be irrevocable and binding on the
Borrowers.
(c) Any notice to be given by the Treasury Manager or a
Borrower to the Agent pursuant to Sections 2.6 or 2.9 and any notice to be given
by the Agent or any Bank hereunder, may be given by telephone, and all such
notices given by the Treasury Manager or a Borrower must be immediately
confirmed in writing or by e-mail, in the manner provided in Section 8.2(a). Any
such notice given by telephone shall be deemed effective upon receipt thereof by
the party to whom such notice is to be given.
8.3 No Waiver By Conduct; Remedies Cumulative. No course of dealing on
the part of the Agent or any Bank, nor any delay or failure on the part of the
Agent or any Bank in exercising any right, power or privilege hereunder shall
operate as a waiver of such right, power or privilege or otherwise prejudice the
Agent's or such Bank's rights and remedies hereunder; nor shall any single or
partial exercise thereof preclude any further exercise thereof or the exercise
of any other right, power or privilege. No right or remedy conferred upon or
reserved to the Agent or any Bank under this Agreement or the Notes or any
Guaranty is intended to be exclusive of any other right or remedy, and every
right and remedy shall be cumulative, except as limited by this Agreement, and
in addition to every other right or remedy granted thereunder or now or
hereafter existing under any applicable law. Every right and remedy granted by
this Agreement or the Notes or any Guaranty or by applicable law to the Agent or
any Bank may be exercised from time to time and as often as may be deemed
expedient by the Agent or any Bank and, unless contrary to the express
provisions of this Agreement or the Notes or such Guaranty, irrespective of the
occurrence or continuance of any Default or Event of Default.
8.4 Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of any Borrower or any
52
Guarantor made herein, in any Guaranty or in any certificate, report, financial
statement or other document furnished by or on behalf of any Borrower or any
Guarantor in connection with this Agreement shall be deemed to be material and
to have been relied upon by the Banks, notwithstanding any investigation
heretofore or hereafter made by any Bank or on such Bank's behalf, and those
covenants and agreements of the Borrowers set forth in Sections 3.6, 3.8, 5.1(f)
and 8.5 hereof shall survive the repayment in full of the Advances and the
termination of the Commitments for a period of one year from such repayment or
termination.
8.5 Expenses; Indemnification. (a) The Company agrees to pay, or
reimburse the Agent for the payment of, on demand, (i) the reasonable fees,
without premium, and reasonable expenses of counsel to the Agent, including
without limitation the reasonable fees and expenses of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ PLLC as
agreed upon with the Company in connection with the preparation, execution,
delivery and administration of the Loan Documents and the consummation of the
transactions contemplated hereby, and in connection with advising the Agent as
to its rights and responsibilities with respect thereto, and in connection with
any amendments, waivers or consents in connection therewith, (ii) all stamp and
other taxes and fees payable in connection with the execution, delivery, filing
or recording of this Agreement, the Notes and the consummation of the
transactions contemplated hereby, and any and all liabilities with respect to or
resulting from any delay in paying or omitting to pay such taxes or fees, (iii)
all reasonable costs and expenses of the Agent (including without limitation
reasonable fees and expenses of counsel, which counsel shall be acceptable to
the Required Banks, including without limitation counsel who are employees of
the Agent, and whether incurred through negotiations, legal proceedings or
otherwise) in connection with any Default or Event of Default or the enforcement
of, or the exercise or preservation of any rights under the Loan Documents or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement, (iv) any costs, internal charges and expenses
(including without limitation reasonable fees and expenses of counsel, which
attorneys may be employees of the Banks) paid or incurred by the Agent or any
Bank in connection with the collection and enforcement of the Loan Documents,
and (v) all reasonable costs and expenses of the Agent and the Banks (including
reasonable fees and expenses of counsel) in connection with any action or
proceeding relating to a court order, injunction or other process or decree
restraining or seeking to restrain the Agent from paying any amount under, or
otherwise relating in any way to, any Letter of Credit and any and all costs and
expenses which any of them may incur relative to any payment under any Letter of
Credit.
(b) Each Borrower hereby indemnifies and agrees to hold
harmless the Banks and the Agent, and their respective officers, directors,
employees and agents, from and against any and all claims, damages, losses,
liabilities, costs or expenses of any kind or nature whatsoever which the Banks
or the Agent or any such person may incur or which may be claimed against any of
them by reason of or in connection with entering into this Agreement or the
transactions contemplated hereby (whether or not such Bank, the Agent or such
other person is a party to the claim, demand, action, cause of action or
proceeding giving rise to such claim, damage, loss, liability, cost or expense);
provided, however, that no Borrower shall be required to indemnify any such Bank
and the Agent or such other person, to the extent, but only to the extent, that
such claim, damage, loss, liability, cost or expense is attributable to the
gross negligence or willful misconduct of such Bank or the Agent, as the case
may be.
8.6 Successors and Assigns. (a) This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns, provided that no Borrower may, without the prior consent of the
Banks, assign its rights or obligations hereunder or under the Notes and the
Banks shall not be obligated to make any Loan hereunder to any entity other than
the Borrowers.
(b) Any Bank may, without the prior consent of the Company
sell to any financial institution(s) or any of its Affiliates, and such
financial institution(s) or Affiliates may further sell, a participation
53
interest (undivided or divided) in, the Loans and such Bank's rights and
benefits under this Agreement and the Notes, and to the extent of that
participation interest such participant or participants shall have the same
rights and benefits against the Borrowers under Section 3.6, 3.8 and 6.2(c) as
it or they would have had if such participant or participants were the Bank
making the Loans to the Borrowers hereunder, provided, however, that (i) such
Bank's obligations under this Agreement shall remain unmodified and fully
effective and enforceable against such Bank, (ii) such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Bank shall remain the holder of its Notes for all purposes of this
Agreement, (iv) the Borrowers, the Agent and the other Banks shall continue to
deal solely and directly with such Bank in connection with such Bank's rights
and obligations under this Agreement, and (v) such Bank shall not grant to its
participant any rights to consent or withhold consent to any action taken by
such Bank or the Agent under this Agreement other than action requiring the
consent of all of the Banks hereunder.
(c) The Agent from time to time in its sole discretion may
appoint agents for the purpose of servicing and administering this Agreement and
the transactions contemplated hereby and enforcing or exercising any rights or
remedies of the Agent provided under this Agreement, the Notes or otherwise. In
furtherance of such agency, the Agent may from time to time direct that the
Borrowers provide notices, reports and other documents contemplated by this
Agreement (or duplicates thereof) to such agent. Each Borrower hereby consents
to the appointment of such agent and agrees to provide all such notices, reports
and other documents and to otherwise deal with such agent acting on behalf of
the Agent in the same manner as would be required if dealing with the Agent
itself.
(d) Each Bank may, with the prior consent of the Company and
the Agent (which consent, in each case, will not be unreasonably withheld),
assign to one or more banks or other entities all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Loans owing to it and the Note or Notes held by
it); provided, however, if an Event of Default has occurred and is continuing,
the consent of the Company shall not be required. With respect to such
assignments, (i) each such assignment shall be of a uniform, and not a varying,
percentage of all rights and obligations, (ii) except in the case of an
assignment of all of a Bank's rights and obligations under this Agreement, the
amount of the Commitment of the assigning Bank being assigned pursuant to each
such assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000, and in
integral multiples of $1,000,000 thereafter, or such lesser amount as the
Company and the Agent may consent to, (iii) the parties to each such assignment
shall execute and deliver to the Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance in the form of Exhibit L hereto (an
"Assignment and Acceptance"), together with any Note or Notes subject to such
assignment and a processing and recordation fee of $3,500, and (iv) any Bank may
without the consent of the Company or the Agent, and without paying any fee,
assign or sell a participation interest to any Affiliate of such Bank all or a
portion of its rights and obligations under this Agreement. Additionally, each
such assignment by a Bank with respect to an assignee which is not an Affiliate
of such Bank shall (unless each of the Company and the Agent otherwise consents)
be made simultaneously with an assignment to such assignee by such Bank of a pro
rata amount of the rights and obligations of such Bank and its Affiliates under
the 364-Day Credit Agreement. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in such Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, have the rights and obligations of a Bank
hereunder and (y) the Bank assignor thereunder shall, to the extent that rights
and obligations hereunder have been assigned by it pursuant to such Assignment
and Acceptance, relinquish its rights and be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance covering all of
the remaining portion of an assigning Bank's rights and obligations under this
Agreement, such Bank shall cease to be a party hereto).
(e) By executing and delivering an Assignment and Acceptance,
the Bank assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Bank makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
54
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of any Borrower or the performance or observance by any Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.6 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Bank or any other Bank and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement; (v) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
this Agreement as are delegated to the Agent by the terms hereof, together with
such powers and discretion as are reasonably incidental thereto; and (vi) such
assignee agrees that it will perform in accordance with their terms all of the
obligations that by the terms of this Agreement are required to be performed by
it as a Bank.
(f) The Agent shall maintain at its address designated on the
signature pages hereof a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Banks and the Commitment of, and principal amount of the Loans owing to,
each Bank from time to time (the "Register"). The entries in the Register shall
be conclusive and binding for all purposes, absent manifest error, and the
Company, the Borrowing Subsidiaries, the Agent and the Banks may treat each
person whose name is recorded in the Register as a Bank hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Company or any Bank at any reasonable time and from time to time upon
reasonable prior notice.
(g) Upon its receipt of an Assignment and Acceptance executed
by an assigning Bank and an assignee, together with any Note or Notes subject to
such assignment, the Agent shall, if such Assignment and Acceptance has been
completed, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Company. Within five (5) Business Days after its receipt of such
notice, the Borrowers, at their own expense, shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note to the order of
such assignee in an amount equal to the Commitment assumed by it pursuant to
such Assignment and Acceptance and, if the assigning Bank has retained a
Commitment hereunder, a new Note to the order of the assigning Bank in an amount
equal to the Commitment retained by it hereunder. Such new Note or Notes shall
be in an aggregate principal amount equal to the aggregate principal amount of
such surrendered Note or Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in substantially the form of
Exhibit L hereto.
(h) No Borrower shall be liable for any costs or expenses of
any Bank in effectuating any participation or assignment under this Section 8.6.
(i) The Banks may, in connection with any assignment,
participation or addition of a bank or proposed assignment, participation or
addition pursuant to this Section 8.6, disclose to the assignee, participant or
Additional Bank or proposed assignee, participant or Additional Bank any
information relating to the Borrowers.
(j) Notwithstanding any other provision set forth in this
Agreement, any Bank may at any time create a security interest in, or assign,
all or any portion of its rights under this Agreement (including, without
limitation, the Loans owing to it and the Note or Notes held by it) in favor of
any Federal Reserve Bank in accordance with Regulation A of the Board of
55
Governors of the Federal Reserve System; provided that such creation of a
security interest or assignment shall not release such Bank from its obligations
under this Agreement.
8.7 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
8.8 Governing Law; Consent to Jurisdiction. This Agreement is a
contract made under, and shall be governed by and construed in accordance with,
the law of the State of Michigan applicable to contracts made and to be
performed entirely within such State and without giving effect to choice of law
principles of such State. Each Borrower further agrees that any legal action or
proceeding with respect to this Agreement or the Notes or the transactions
contemplated hereby shall be brought in any court of the State of Michigan, or
in any court of the United States of America sitting in Michigan, and each
Borrower hereby irrevocably submits to and accepts generally and unconditionally
the jurisdiction of those courts with respect to its person and property, and
irrevocably appoints ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, whose address is set forth in Section
8.2, as its agent for service of process and irrevocably consents to the service
of process in connection with any such action or proceeding by personal delivery
to such agent or to the Borrowers or by the mailing thereof by registered or
certified mail, postage prepaid to the Borrowers at the address set forth in
Section 8.2. Nothing in this paragraph shall affect the right of the Banks and
the Agent to serve process in any other manner permitted by law or limit the
right of the Banks or the Agent to bring any such action or proceeding against
the Borrowers or property in the courts of any other jurisdiction. Each Borrower
hereby irrevocably waives any objection to the laying of venue of any such suit
or proceeding in the above described courts.
8.9 Table of Contents and Headings. The table of contents and the
headings of the various subdivisions hereof are for the convenience of reference
only and shall in no way modify any of the terms or provisions hereof.
8.10 Construction of Certain Provisions. If any provision of this
Agreement refers to any action to be taken by any person, or which such person
is prohibited from taking, such provision shall be applicable whether such
action is taken directly or indirectly by such person, whether or not expressly
specified in such provision.
8.11 Integration and Severability. This Agreement and the Notes embody
the entire agreement and understanding between the Borrowers and the Agent and
the Banks, and supersede all prior agreements and understandings, relating to
the subject matter hereof. In case any one or more of the obligations of any
Borrower under this Agreement or the Notes shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining obligations of such Borrower and the other Borrowers shall not in
any way be affected or impaired thereby, and such invalidity, illegality or
unenforceability in one jurisdiction shall not affect the validity, legality or
enforceability of the obligations of the Borrowers under this Agreement or the
Notes in any other jurisdiction.
8.12 Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any such covenant, the fact that it would be permitted by an exception to, or
would be otherwise within the limitations of, another covenant shall not avoid
the occurrence of a Default or an Event of Default if such action is taken or
such condition exists.
8.13 Interest Rate Limitation. Notwithstanding any provisions of this
Agreement or the Notes, in no event shall the amount of interest paid or agreed
to be paid by any Borrower exceed an amount computed at the highest rate of
56
interest permissible under applicable law. If, from any circumstances
whatsoever, fulfillment of any provision of this Agreement or the Notes at the
time performance of such provision shall be due, shall involve exceeding the
interest rate limitation validly prescribed by law which a court of competent
jurisdiction may deem applicable hereto, then, ipso facto, the obligations to be
fulfilled shall be reduced to an amount computed at the highest rate of interest
permissible under applicable law, and if for any reason whatsoever any Bank
shall ever receive as interest an amount which would be deemed unlawful under
such applicable law such interest shall be automatically applied to the payment
of principal of such Bank's Advances outstanding hereunder (whether or not then
due and payable) and not to the payment of interest, or shall be refunded to the
Borrowers if such principal and all other obligations of the Borrowers to such
Bank have been paid in full.
8.14 Confidentiality. The Banks and the Agent shall hold all
confidential information obtained pursuant to the requirements of this Agreement
in accordance with their customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices and in any event may make disclosure to its examiners, affiliates,
outside auditors, counsel and other professional advisors in connection with
this Agreement or as reasonably required by any bona fide transferee or
participant in connection with the contemplated transfer of any Note or
participation therein or as required or requested by any governmental or
regulatory agency or representative thereof or pursuant to legal process.
Without limiting the foregoing, it is expressly understood that such
confidential information shall not include information which, at the time of
disclosure is in the public domain or, which after disclosure, becomes part of
the public domain or information which is obtained by any Bank or the Agent
prior to the time of disclosure and identification by the Company under this
Section, or information received by any Bank or the Agent from a third party
unless such third party is bound by this Agreement. Nothing in this Section or
otherwise shall prohibit any Bank or the Agent from disclosing any confidential
information to the other Banks or the Agent or render any of them liable in
connection with any such disclosure.
8.15 Waiver of Jury Trial. The Borrowers, the Banks and the Agent,
after consulting or having had the opportunity to consult with counsel,
knowingly, voluntarily and intentionally waive any right either of them may have
to a trial by jury in any litigation based upon or arising out of this Agreement
or any other Loan Document or any of the transactions contemplated by this
Agreement or any course of conduct, dealing, statements (whether oral or
written) or actions of any of them. Neither any Borrower, any Bank nor the Agent
shall seek to consolidate, by counterclaim or otherwise, any such action in
which a jury trial has been waived with any other action in which a jury trial
cannot be or has not been waived. These provisions shall not be deemed to have
been modified in any respect or relinquished by any party hereto except by a
written instrument executed by such party.
8.16 Unification of Certain Currencies. Without prejudice to any method
of conversion or rounding prescribed by any legislative measures of the European
Council (including without limitation, Regulation 1103/97 of 17 June 1997), each
reference in this Agreement to a fixed amount or to fixed amounts in a National
Currency Unit to be paid to or by the Agent shall, notwithstanding any other
provision of this Agreement, be replaced by a reference to such comparable and
convenient fixed amount or fixed amounts in the Euro as the Agent may from time
to time specify.
57
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered on the 17th day of October, 2001.
INVACARE CORPORATION
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Chief Financial Officer and Secretary
INVACARE (DEUTSCHLAND) GmbH
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Chief Financial Officer
INVACARE AUSTRALIA PTY. LTD.
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Director
INVACARE CANADA INC.
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Treasurer and Secretary
INVACARE S.A.
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Chief Financial Officer
INVACARE BV
By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Chief Financial Officer
58
Address for Notices: BANK ONE, MICHIGAN, as a Bank and as Agent
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By:/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Its: First Vice President
------------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: KEYBANK NATIONAL ASSOCIATION, as a Bank and
Syndication Agent
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Its: Vice President
------------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: NATIONAL CITY BANK, as a Bank and n
Documentatio Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Loc. 2077 By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Its: senior Vice President
------------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: BANK OF AMERICA, N.A., as a Bank and
Documentation Agent
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ By:/S/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇ Its:Principal
-----------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
59
Address for Notices: THE CHASE MANHATTAN BANK, as a
Bank and as Co-Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Tower By:/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇ Its:Vice President
----------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: THE BANK OF NEW YORK
One Wall Street By:/S/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Its:Vice President
----------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: CREDIT LYONNAIS NEW YORK BRANCH
1301 Avenue of the Americas By:/S/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇ Its:Senior Vice President
----------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: FIFTH THIRD BANK
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ By:/S/ ▇▇▇ ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇ Its:Vice President
---------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: ▇▇▇▇▇▇ TRUST AND SAVINGS BANK
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ By:/S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Its:Vice President
---------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
60
Address for Notices: ▇▇▇▇▇▇ BANK Plc
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By:/S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Its:Vice President
--------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: PNC BANK, NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ By:/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Its:Senior Vice President
--------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for Notices: SUNTRUST BANK
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ By:/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ Its:Vice President
--------------------------------------
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
61
EXHIBIT A
BID-OPTION NOTE
October 17, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
For value received, _________________________, a ______________ corporation (the
"Borrower"), promises to pay to the order of ___________________________________
(the "Bank"), the unpaid principal amount of each Bid-Option Loan made by the
Bank to the Company pursuant to the Credit Agreement referred to below, on the
last day of the Interest Period relating to such Loan. The Borrower further
promises to pay interest on the aggregate unpaid principal amount of such
Bid-Option Loans on the dates and at the rates negotiated as provided in the
Credit Agreement. All such payments of principal and interest with respect to
Bid-Option Loans shall be made in Dollars in immediately available funds at the
Agent's principal office in Detroit, Michigan.
Presentment, demand for payment, notice of non-payment, protest and further
notice or demand of any kind in connection with this Bid-Option Note are hereby
expressly waived by the Borrower and each endorser or guarantor hereof.
This Bid-Option Note evidences one or more Bid-Option Loans made under the
Five-Year Credit Agreement, dated as of October __, 2001, as amended,
supplemented or otherwise modified from time to time (the "Credit Agreement"),
by and among the Borrower, certain other Borrowers designated therein from time
to time, the banks (including the Bank) party thereto, and Bank One, Michigan,
as administrative agent (the "Agent"), to which reference is hereby made for a
statement of the circumstances under which this Bid-Option Note is subject to
prepayment and under which its due date may be accelerated. Capitalized terms
used but not defined in this Bid-Option Note shall have the respective meanings
ascribed thereto in the Credit Agreement.
This Bid-Option Note is made under, and shall be governed by and construed in
accordance with, the laws of the State of Michigan applicable to contracts made
and to be performed entirely within such State and without giving effect to
choice of law principles of such State.
----------------------------
By: ____________________________________
Its: __________________________________
EXHIBIT B
AGREEMENT
Reference is made to the Five-Year Credit Agreement dated as of October 17, 2001
(as now or hereafter amended or modified from time to time, the "Credit
Agreement") among INVACARE CORPORATION, an Ohio corporation (the "Company"),
certain borrowing subsidiaries designated therein from time to time (the
"Borrowing Subsidiaries, and collectively with the Company, the "Borrowing
Subsidiaries"), the banks named therein (the "Banks"), and BANK ONE, MICHIGAN,
as administrative agent for the Banks (the "Agent"). Terms defined in the Credit
Agreement are used herein with the same meaning.
1. __________________, a ___________ corporation (the "New Borrowing
Subsidiary") has decided to become a Borrowing Subsidiary under the Credit
Agreement, with its address for notice as described next to its signature below.
The New Borrowing Subsidiary (i) confirms that it has received a copy of the
Credit Agreement, together with copies of documents and information as it has
deemed appropriate to make its own decision to enter into this Agreement; (ii)
agrees that it will perform in accordance with all of the obligations and comply
with all of the covenants that by the terms of the Credit Agreement and the
other Loan Documents are required to be performed by or complied with by it as a
Borrowing Subsidiary; (iii) confirms that the representations and warranties
contained in Article IV of the Credit Agreement and in any other Credit
Agreement applicable to a Borrowing Subsidiary are true and correct as of the
date hereof as to the New Borrowing Subsidiary and (iv) authorizes Invacare
Corporation, as Treasury Manager, to act as its manager under the Credit
Agreement pursuant to Section 2.12 of the Credit Agreement.
2. Upon execution and delivery of this Agreement to the Agent together with all
other items required pursuant to paragraph 3, the New Borrowing Subsidiary shall
be a party to the Credit Agreement and have the rights and obligations of a
Borrowing Subsidiary thereunder.
3. This Agreement shall not become effective and the New Borrowing Subsidiary
shall not become a Borrowing Subsidiary under the Credit Agreement until receipt
by the Agent of the following documents and completion of the following matters,
in form and substance reasonably satisfactory to the Agent:
(a) A certificate of incumbency of the Company and the New Borrowing Subsidiary
containing, and attesting to the genuineness of, the signatures of those
officers authorized to act on behalf of the New Borrowing Subsidiary in
connection with this Agreement, the Credit Agreement and the Notes and on behalf
of the Company in connection with this Agreement and the consummation by the New
Borrowing Subsidiary and the Company of the transactions contemplated herein,
certified as true and correct as of the effective date of this Agreement by a
duly authorized officer of the New Borrowing Subsidiary and the Company,
respectively; and
(b) The Notes, duly executed on behalf of the New Borrowing Subsidiary, for each
Bank;
4. The Company (a) fully consents to the New Borrowing Subsidiary becoming a
Borrowing Subsidiary; (b) agrees that the Guaranty with respect to the
indebtedness, obligations and liabilities of the Borrowing Subsidiaries dated as
of October ___, 2001 in favor of the Agent and the Banks is ratified and
confirmed and shall remain in full force and effect; and (c) confirms that all
indebtedness, obligations and liabilities of the Borrowing Subsidiaries,
including the New Borrowing Subsidiary, are guaranteed by the Guaranty.
5. This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Michigan.
6. 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 all of which taken together shall constitute one
and the same agreement.
7. Upon delivery of this executed Agreement to the Agent, the Agent shall
deliver a copy of this Agreement to each Bank, together with the original Notes
payable to each such Bank.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officer thereunto duly authorized as of the day and
year first above written.
______________________ [NEW BORROWING SUBSIDIARY]
==============================
Attention: ___________________ By:______________________________________
Facsimile No. (___) ___-____
Its:____________________________________
INVACARE CORPORATION
By:_____________________________________
Its:___________________________________
BANK ONE, MICHIGAN, as Agent
By: _____________________________________
Its: __________________________________
EXHIBIT C
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of October 17, 2001 (this "Guaranty") made by
INVACARE CORPORATION, an Ohio corporation (the "Guarantor"), in favor of the
banks which are parties to the Credit Agreement hereinafter defined (the
"Banks"), and BANK ONE, MICHIGAN, a Michigan banking corporation, as
administrative agent (in such capacity, the "Agent") for such Banks under the
Credit Agreement.
W I T N E S S E T H:
A. The Guarantor and certain subsidiaries of the Guarantor set forth on Schedule
A hereto (the "Subsidiaries"), have entered into a Five-Year Credit Agreement,
dated as of even date herewith (as amended or modified from time to time, the
"Credit Agreement") with the Agent and the Banks, pursuant to which the Banks
have agreed to make Advances to the Subsidiaries and, in their sole discretion,
other subsidiaries of the Guarantor (such subsidiaries and the Subsidiaries
being collectively referred to herein as the "Borrowing Subsidiaries"), subject
to the terms and conditions of the Credit Agreement; and
B. As a condition to the obligation of the Banks under the Credit Agreement, the
Guarantor is required to fully and unconditionally guarantee, among other
things, the Advances and other obligations of the Borrowing Subsidiaries;
NOW, THEREFORE, as an inducement to the Banks to enter into the transactions
contemplated by the Credit Agreement, the Guarantor agrees with the Banks and
the Agent as follows:
1. Guarantee of Obligations. The Guarantor hereby (i) guarantees, as principal
obligor and not as surety only, to the Banks the prompt payment of the principal
of and any and all accrued and unpaid interest (including interest which
otherwise may cease to accrue by operation of any insolvency law, rule,
regulation or interpretation thereof) on (x) the Advances made to any of the
Borrowing Subsidiaries, (y) reimbursement of all amounts due to the Banks upon
issuance of letters of credit for the benefit of any of the Borrowing
Subsidiaries, and (z) all other loans or advances by any Bank to any of the
Borrowing Subsidiaries, or other obligations of any of the Borrowing
Subsidiaries to the Agent and the Banks, including without limitation foreign
exchange loans and advances which are not made pursuant to the terms of the
Credit Agreement, all when due, whether by scheduled maturity, acceleration or
otherwise, all in accordance with the terms of the Credit Agreement or such
other documents or instruments evidencing such loans, advances or obligations
(the "Other Loan Documents"), and any and all other amounts which may be payable
by any of the Borrowing Subsidiaries to any Bank or the Agent in connection with
or pursuant to the Credit Agreement and the Other Loan Documents, including,
without limitation, default interest, indemnification payments and all
reasonable costs and expenses incurred by the Banks and the Agent in connection
with enforcing any obligations of the Borrowing Subsidiaries thereunder,
including without limitation the reasonable fees and disbursements of counsel,
(ii) guarantees the prompt and punctual performance and observance of each and
every term, covenant or agreement contained in the Credit Agreement and the
Other Loan Documents to be performed or observed on the part of any of the
Borrowing Subsidiaries, and (iii) agrees to make prompt payment, on demand, of
any and all reasonable costs and expenses incurred by the Banks or the Agent in
connection with enforcing the obligations of the Guarantor hereunder, including,
without limitation, the reasonable fees and disbursements of counsel (all of the
foregoing being collectively referred to as the "Guaranteed Obligations", and
the Credit Agreement and the Other Loan Documents are sometimes collectively
referred to as the "Credit Agreements").
(a) If for any reason any duty, agreement or obligation of any of the Borrowing
Subsidiaries contained in the Credit Agreements shall not be performed or
observed by the relevant Borrowing Subsidiary as provided therein, or if any
amount payable under or in connection with the Credit Agreements shall not be
paid in full when the same becomes due and payable, the Guarantor undertakes to
perform or cause to be performed promptly each of such duties, agreements and
obligations and to pay forthwith each such amount to the Agent for the account
of the Banks regardless of any defense or setoff or counterclaim which any of
the Borrowing Subsidiaries may have or assert, and regardless of any other
condition or contingency.
(b) The date and amount of advances of principal made by the Banks in respect of
the Loans made to the Borrowing Subsidiaries and the aggregate principal amount
thereof and accrued interest thereon shown upon the books and records of each
respective Bank and in any certificate delivered by any Bank to the Guarantor in
respect thereof, shall be prima facie evidence of the principal amount and
accrued interest owing and unpaid on such Loans. The failure to record any such
information on such books and records shall not, however, limit or otherwise
affect the obligations of any of the Borrowing Subsidiaries to repay the
principal amount of such Loans together with accrued interest thereon or the
obligations of the Guarantor hereunder with respect thereto.
2. Nature of Guaranty. This Guaranty is an absolute and unconditional and
irrevocable guaranty of payment and not a guaranty of collection and is wholly
independent of and in addition to other rights and remedies of the Banks and the
Agent and is not contingent upon the pursuit by the Banks and the Agent of any
such rights and remedies, such pursuit being hereby waived by the Guarantor.
3. Waivers and Other Agreements. The Guarantor hereby unconditionally (a) waives
any requirement that the Banks or the Agent, upon the occurrence of an "Event of
Default" (as defined in the Credit Agreement) or an event of default under any
of the Other Loan Documents by any of the Borrowing Subsidiaries, first make
demand upon, or seek to enforce remedies against, any or all of the Borrowing
Subsidiaries before demanding payment under or seeking to enforce this Guaranty,
(b) covenants that this Guaranty will not be discharged except by complete
performance of all obligations of the Borrowing Subsidiaries contained in the
Credit Agreements, (c) agrees that this Guaranty shall remain in full force and
effect without regard to, and shall not be affected or impaired, without
limitation, by any invalidity, irregularity or unenforceability in whole or in
part of the Credit Agreements, or any limitation on the liability of any of the
Borrowing Subsidiaries thereunder, or any limitation on the method or terms of
payment thereunder which may now or hereafter be caused or imposed in any manner
whatsoever, (d) waives diligence, presentment and protest with respect to, and
any notice of default or dishonor in the payment of any amount at any time
payable by any of the Borrowing Subsidiaries under or in connection with the
Credit Agreements, and further waives any requirement of notice of acceptance
of, or other formality relating to, this Guaranty and (e) agrees that the
Guaranteed Obligations shall include any amounts paid by any of the Borrowing
Subsidiaries to any Bank or the Agent which may be required to be returned to
any of the Borrowing Subsidiaries, or to its representative or to a trustee,
custodian or receiver for any of the Borrowing Subsidiaries.
4. Obligations Absolute. The obligations, covenants, agreements and duties of
the Guarantor under this Guaranty shall not be released, affected or impaired by
any of the following whether or not undertaken with notice to or consent of the
Guarantor: (a) any assignment or transfer, in whole or in part, of the Loans
made to the Borrowing Subsidiaries or the Credit Agreements although made
without notice to or consent of the Guarantor, or (b) any waiver by any Bank or
the Agent, or by any other person, of the performance or observance by any of
the Borrowing Subsidiaries of any of the agreements, covenants, terms or
conditions contained in the Credit Agreements, or (c) any indulgence in or the
extension of the time for payment by any of the Borrowing Subsidiaries of any
amounts payable under or in connection with the Credit Agreements, or of the
time for performance by any of the Borrowing Subsidiaries of any other
obligations under or arising out of the Credit Agreements, or the extension or
renewal thereof, or (d) the modification, amendment or waiver (whether material
or otherwise) of any duty, agreement or obligation of any of the Borrowing
Subsidiaries set forth in the Credit Agreements (the modification, amendment or
waiver from time to time of the Credit Agreements being expressly authorized
without further notice to or consent of the Guarantor), or (e) the voluntary or
involuntary liquidation, sale or other disposition of all or substantially all
of the assets of any of the Borrowing Subsidiaries, or any receivership,
insolvency, bankruptcy, reorganization, or other similar proceedings, affecting
any of the Borrowing Subsidiaries or any of their assets, or (f) the merger or
consolidation of any of the Borrowing Subsidiaries or the Guarantor with any
other person, or (g) the release or discharge of any of the Borrowing
Subsidiaries or the Guarantor from the performance or observance of any
agreement, covenant, term or condition contained in the Credit Agreements, by
operation of law, or (h) any other cause whether similar or dissimilar to the
foregoing which would release, affect or impair the obligations, covenants,
agreements or duties of the Guarantor hereunder.
5. Foreign Currency. This Guaranty arises in the context of an international
transaction, and the specification of payment in foreign currency to the Agent
and the Banks pursuant to the Credit Agreement is of the essence. The foreign
currency shall be the currency of account and payment under the Credit
Agreements. The obligation of the Guarantor shall not be discharged by an amount
paid in any other currency or at another place, whether pursuant to a judgment
or otherwise, to the extent that the amount so paid, on prompt conversion into
the foreign currency and transfer to the Agent and the Banks under normal
banking procedure, does not yield the amount of foreign currency due under this
Guaranty. In the event that any payment, whether pursuant to a judgment or
otherwise, upon conversion and transfer, does not result in payment of the
amount of foreign currency due under this Guaranty, the Agent and the Banks
shall have an independent cause of action against the Guarantor for the foreign
currency deficiency.
6. Events of Default. The occurrence of any "Event of Default" (as defined in
the Credit Agreement) shall be deemed an "event of default"
hereunder unless waived by the Banks pursuant to paragraph 8.
7. Remedies. Upon the occurrence and during the continuance of such event of
default, the Agent may, and upon being directed to do so by the Required Banks,
shall enforce its rights either by suit in equity, or by action at law, or by
other appropriate proceedings, whether for the specific performance (to the
extent permitted by law) of any covenant or agreement contained in this Guaranty
or in aid of the exercise of any power granted in this Guaranty and may enforce
payment under this Guaranty and any of its other rights available at law or in
equity.
8. Amendments, Etc. This Guaranty may be amended from time to time and any
provision hereof may be waived in accordance with the requirements of Section
8.1 of the Credit Agreement. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by the Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Required Banks
or all of the Banks, as the case may be, and, to the extent any rights or duties
of the Agent may be affected, the Agent, and then such amendment, waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
9. Notices. All notices and other communications hereunder shall be in writing
and made in accordance with Section 8.2 of the Credit Agreement.
10. Conduct No Waiver; Remedies Cumulative. The obligations of the Guarantor
under this Guaranty are continuing obligations and a fresh cause of action shall
arise in respect of each event of default hereunder. No course of dealing on the
part of any Bank or the Agent, nor any delay or failure on the part of any Bank
or the Agent in exercising any right, power or privilege hereunder shall operate
as a waiver of such right, power or privilege or otherwise prejudice any Bank or
the Agent's rights and remedies hereunder; nor shall any single or partial
exercise thereof preclude any further exercise thereof or the exercise of any
other right, power or privilege. No right or remedy conferred upon or reserved
to the Banks or the Agent under this Guaranty is intended to be exclusive of any
other right or remedy, and every right and remedy shall be cumulative and in
addition to every other right or remedy given hereunder or now or hereafter
existing under any applicable law. Every right and remedy given by this Guaranty
or by applicable law to the Banks or the Agent may be exercised from time to
time and as often as may be deemed expedient by them.
11. Reliance on and Survival of Various Provisions. All terms, covenants,
agreements, representations and warranties of the Guarantor made herein or in
any certificate or other document delivered pursuant hereto shall be deemed to
be material and to have been relied upon by the Banks or the Agent,
notwithstanding any investigation heretofore or hereafter made by the Banks or
the Agent or on their behalf.
12. No Investigation by the Banks or the Agent. The Guarantor hereby waives
unconditionally any obligation which, in the absence of such provision, the
Banks or the Agent might otherwise have to investigate or to assure that there
has been compliance with the law of any jurisdiction with respect to the
Guaranteed Obligations recognizing that, to save both time and expense, the
Guarantor has requested that the Banks and the Agent not undertake such
investigation. The Guarantor hereby expressly confirms that the obligations of
the Guarantor hereunder shall remain in full force and effect without regard to
compliance or noncompliance with any such law and irrespective of any
investigation or knowledge of any Bank or the Agent of any such law.
13. Governing Law. This Guaranty is a contract made under, and the rights and
obligations of the parties hereunder, shall be governed by and construed in
accordance with, the laws of the State of Michigan applicable to contracts to be
made and to be performed entirely with such State without regard to the choice
of law principles of such State.
14. Headings. The headings of the various subdivisions hereof are for
convenience of reference only and shall in no way modify any of its terms or
provisions hereof.
15. Construction of Certain Provisions. If any provision of this Guaranty refers
to any action to be taken by any person, or which such person is prohibited from
taking, such provision shall be applicable whether such action is taken directly
or indirectly by such person, whether or not expressly specified in such
provision.
16. Integration and Severability. This Guaranty embodies the entire agreement
and understanding between the Guarantor, the Banks and the Agent, and supersedes
all prior all agreements and understandings, relating to the subject matter
hereof. In any case one or more of the obligations of the Guarantor under this
Guaranty shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining obligations of the
Guarantor shall not in any way be affected or impaired thereby, and such
invalidity, illegality or unenforceability in one jurisdiction shall not affect
the validity, legality or enforceability of the obligations of the Guarantor
under this Guaranty in any other jurisdiction.
17. Indemnity. As a separate, additional and continuing obligation, the
Guarantor unconditionally and irrevocably undertakes and agrees with the Banks
and the Agent that, should the Guaranteed Obligations not be recoverable from
the Guarantor under paragraph 1 for any reason whatsoever (including, without
limitation, by reason of any provision of the Credit Agreement or any other
agreement or instrument executed in connection therewith being or becoming void,
unenforceable, or otherwise invalid under any applicable law) then,
notwithstanding any knowledge thereof by any Bank or the Agent at any time, the
Guarantor as sole, original and independent obligor, upon demand by the Agent,
will make payment to the Agent for the account of the Banks and the Agent of the
Guaranteed Obligations by way of a full indemnity in such currency and otherwise
in such manner as is provided in the Credit Agreement or such other agreement or
instrument, as the case may be.
18. Subordination, Subrogation, Etc. The Guarantor agrees that any present or
future indebtedness, obligations or liabilities of any Borrowing Subsidiary to
the Guarantor shall be fully subordinate and junior in right and priority of
payment to any present or future indebtedness, obligations or liabilities of any
Borrowing Subsidiary to the Banks and the Agent, and the Guarantor shall not
exercise any right of subrogation, reimbursement or indemnity whatsoever nor any
right of recourse to security for the debts and obligations of any Borrowing
Subsidiary, until all of the Guaranteed Obligations have been paid in full and
are not subject to any right of revocation or rescission.
19. Jurisdiction and Venue. The Guarantor agrees that any legal action or
proceeding with respect to this Guaranty or the Credit Agreement or the
transactions contemplated thereby may be brought only in any court in the State
of Michigan, or any court of the United States of America sitting in the State
of Michigan, and the Guarantor hereby submits to and accepts generally and
unconditionally the jurisdiction of those courts with respect to its person and
property, and irrevocably consents to the service of process in connection with
any such action or proceeding by personal delivery to the Guarantor or by
mailing thereof by registered or certified mail, postage prepaid, to the
Guarantor at its address as provided by it from time to time under the Credit
Agreements. Nothing in this paragraph shall affect the right of the Agent or any
Bank to serve process in any other manner permitted by law or limit the right of
the Agent or any Bank to bring any such action or proceeding against the
Guarantor or its property in the courts of any other jurisdiction. The Guarantor
hereby irrevocably waives any objection to the laying of venue of any such suit
or proceeding in the above-described courts.
20. Waiver of Jury Trial. The Agent, the Banks and the Guarantor, after
consulting or having had the opportunity to consult with counsel, knowingly,
voluntarily and intentionally waive any right any of them may have to a trial by
jury in any litigation based upon or arising out of this Guaranty or any related
instrument or agreement or any of the transactions contemplated by this
Guaranty. Neither the Agent, any Bank nor the Guarantor shall seek to
consolidate, by counterclaim or otherwise, any such action in which a jury trial
has been waived with any other action in which a jury trial cannot be or has not
been waived. These provisions shall not be deemed to have been modified in any
respect or relinquished by the Agent, any Bank or the Guarantor except by a
written instrument executed by all of them.
21. Inapplicability of Surety Provisions. The parties hereby agree that the
Guarantor is not a surety within the meaning of Section 1341.03 of the Ohio
Revised Code.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be duly executed and delivered as of this 17th day of October, 2001.
INVACARE CORPORATION
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
____________________________________
Its: Chief Financial Officer and Secretary
_________________________________
The undersigned hereby executes this Guaranty for the purpose of accepting it
and agreeing to paragraph 20 hereof.
BANK ONE, MICHIGAN, as Agent
By: _______________________________
Its: ___________________________
Dated: October 17, 2001
EXHIBIT A
Invacare (Deutschland) GmbH
Invacare Australia Pty. Ltd.
Invacare Canada Inc.
Invacare S.A.
Invacare BV
EXHIBIT D
REVOLVING CREDIT NOTE
October 17, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
FOR VALUE RECEIVED, ____________________, a ____________ corporation (the
"Borrower"), hereby promises to pay to the order of _________________________, a
________________ (the "Bank"), at the place and currency and manner designated
in the Credit Agreement referred to below and in immediately available funds,
the unpaid principal amount of all Revolving Credit Loans as is recorded in the
books and records of the Bank on the Termination Date and to pay interest on the
unpaid principal balance hereof from time to time outstanding, in like money and
funds, for the period from the date hereof until the Revolving Credit Loans
evidenced hereby shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement referred to below.
The Bank is hereby authorized by the Borrower to record on its books and
records, the date, currency, amount and type of each Revolving Credit Loan, the
duration of the related Interest Period (if applicable), the amount of each
payment or prepayment of principal thereon and the other information provided
for in such books and records, which such books and records shall constitute
prima facie evidence of the information so recorded, provided, however, that any
failure by the Bank to record any such information shall not relieve the
Borrower of its obligation to repay the outstanding principal amount of such
Revolving Credit Loans, all accrued interest thereon and any amount payable with
respect thereto in accordance with the terms of this Revolving Credit Note and
the Credit Agreement.
The Borrower and each endorser or guarantor hereof waives demand, presentment,
protest, diligence, notice of dishonor and any other formality in connection
with this Revolving Credit Note. Should the indebtedness evidenced by this
Revolving Credit Note or any part thereof be collected in any proceeding or be
placed in the hands of attorneys for collection, the Borrower agrees to pay, in
addition to the principal, interest and other sums due and payable hereon, all
costs of collecting this Revolving Credit Note, including attorneys' fees and
expenses (including without limitation allocated costs and expenses of attorneys
who are employees of the Bank).
This Revolving Credit Note evidences one or more Revolving Credit Loans made
under a Five-Year Credit Agreement, dated as of October 17, 2001 (as amended or
modified from time to time, the "Credit Agreement"), by and among Invacare
Corporation, an Ohio corporation (the "Company"), certain Borrowing Subsidiaries
designated therein from time to time (collectively with the Company, the
"Borrowers"), the banks (including the Bank) named therein, and Bank One,
Michigan, as administrative agent for the banks, to which reference is hereby
made for a statement of the circumstances under which this Revolving Credit Note
is subject to prepayment and under which its due date may be accelerated.
Capitalized terms used but not defined in this Revolving Credit Note shall have
the respective meanings assigned to them in the Credit Agreement.
This Revolving Credit Note is made under, and shall be governed by and construed
in accordance with, the laws of the State of Michigan in the same manner
applicable to contracts made and to be performed entirely within such State and
without giving effect to choice of law principles of such State.
-------------------------
By:__________________________________
Its:_________________________________
EXHIBIT E
SWING LINE NOTE
October 17, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
FOR VALUE RECEIVED, ________________________, a __________ corporation (the
"Borrower"), promises to pay to the order of Bank One, Michigan, a Michigan
banking corporation (the "Bank"), at the place and in the currency and manner
designated in the Credit Agreement referred to below and in immediately
available funds, the unpaid principal amount of Swing Loans as is recorded in
the books and records of the Bank, on the Termination Date; and to pay interest
on the unpaid principal balance hereof from time to time outstanding, in like
money and funds, for the period from the date hereof until the Swing Loans
evidenced hereby shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement referred to below.
The Bank is hereby authorized by the Borrower to record on its books and
records, the date, currency, amount and type of each Swing Loan, the duration of
the related Interest Period (if applicable), the amount of each payment or
prepayment of principal thereon and the other information provided for on such
schedule, which schedule or such books and records, as the case may be, shall
constitute prima facie evidence of the information so recorded, provided,
however, that any failure by the Bank to record any such information shall not
relieve the Borrower of its obligation to repay the outstanding principal amount
of such Swing Loans, all accrued interest thereon and any amount payable with
respect thereto in accordance with the terms of this Swing Line Note and the
Credit Agreement.
The Borrower and each endorser or guarantor hereof waives demand, presentment,
protest, diligence, notice of dishonor and any other formality in connection
with this Swing Line Note. Should the indebtedness evidenced by this Swing Line
Note or any part thereof be collected in any proceeding or be placed in the
hands of attorneys for collection, the Borrower agrees to pay, in addition to
the principal, interest and other sums due and payable hereon, all costs of
collecting this Swing Line Note, including attorneys' fees and expenses.
This Swing Line Note evidences one or more Swing Loans made under a Five-Year
Credit Agreement, dated as of October 17, 2001 (as amended or modified from time
to time, the "Credit Agreement"), by and among Invacare Corporation, an Ohio
corporation (the "Company"), the Borrowing Subsidiaries designated therein from
time to time (collectively with the Company, the "Borrowers"), the banks
(including the Bank) named therein, and Bank One, Michigan, as administrative
agent for the banks, to which reference is hereby made for a statement of the
circumstances under which this Swing Line Note is subject to prepayment and
under which its due date may be accelerated. Capitalized terms used but not
defined in this Swing Line Note shall have the respective meanings assigned to
them in the Credit Agreement.
This Swing Line Note is made under, and shall be governed by and construed in
accordance with, the laws of the State of Michigan in the same manner applicable
to contracts made and to be performed entirely within such State and without
giving effect to choice of law principles of such State.
-------------------------------
By:__________________________________
Its:_________________________________
EXHIBIT F
BID-OPTION QUOTE REQUEST
[Date]
Bank One, Michigan,
as Agent for the Banks
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Invacare Corporation (the "Treasury Manager") on behalf of the Borrowers
referred to below, hereby requests offers to make Bid-Option Loans comprising
the Bid-Option Borrowing(s) described below pursuant to Section 2.2(b) of the
Five-Year Credit Agreement, dated as of October ___, 2001, as amended,
supplemented or otherwise modified (the "Credit Agreement"), by and among
INVACARE CORPORATION, an Ohio corporation (the "Company"), certain Borrowing
Subsidiaries designated therein from time to time (collectively with the
Company, the "Borrowers"), the Banks, and BANK ONE, MCIHIGAN, as administrative
agent. Capitalized terms used but not defined herein shall have the respective
meanings ascribed thereto in the Credit Agreement.
Date of Bid-Option Borrowing(s): ________, 200_
Designated Borrower: _____________________
Aggregate Amount of each Bid-Option Borrowing: (a) _______________*
(b) ______________
(c) ______________
Interest Period: (a) ______________**
(b) ______________
(c) ______________
INVACARE CORPORATION
By:_______________________________________
Its:_____________________________________
*Must be (a) $5,000,000 or a larger multiple of $1,000,000.
**Must comply with the definition of the term "Bid-Option Interest Period."
EXHIBIT G
INVITATION FOR BID-OPTION QUOTES
[Date]
To: [Name of Bank]
Attention: ____________________
Reference is made to the Five-Year Credit Agreement, dated as of October 17,
2001, as amended, supplemented or otherwise modified (the "Credit Agreement"),
by and among INVACARE CORPORATION, an Ohio corporation (the "Company") certain
Borrowing Subsidiaries designated therein from time to time (collectively with
the Company, the "Borrowers"), the Banks, and BANK ONE, MICHIGAN, as
administrative agent (the "Agent"). Capitalized terms used but not defined
herein shall have the respective meanings ascribed thereto in the Credit
Agreement.
Pursuant to Section 2.2(c) of the Credit Agreement, Bank One, Michigan, as
Agent, is pleased on behalf of the Borrowers to invite you to submit Bid-Option
Quotes to the Borrowers for the Bid-Option Borrowing(s) described below.
Date of Bid-Option Borrowing(s): ________, 200_
Designated Borrower: ____________________
Aggregate Amount of Each
Bid-Option Borrowing: Interest Period:
(a) ____________________ (a) ________________
(b) ____________________ (b) ________________
(c) ____________________ (c) ________________
Please respond to this invitation by no later than 9:00 a.m.
(Detroit time) on _________________, 200_.*
BANK ONE, MICHIGAN, as Agent
By: ______________________________________
Its: ____________________________________
* Insert date of Bid-Option Borrowing
EXHIBIT H
BID-OPTION QUOTE
[Date]
Bank One, Michigan, as Agent
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Reference is made to the Five-Year Credit Agreement, dated as of October 17,
2001, as amended, supplemented or otherwise modified (the "Credit Agreement"),
by and among INVACARE CORPORATION, an Ohio corporation (the "Company"), certain
Borrowing Subsidiaries designated therein from time to time (collectively with
the Company, the "Borrowers"), the Banks, and BANK ONE, MICHIGAN, as
administrative agent (the "Agent"). Capitalized terms used but not defined
herein shall have the respective meanings ascribed thereto in the Credit
Agreement.
In response to your Invitation for Bid-Option Quotes dated _____, 200_,
_________________________ (the "Bank"), hereby makes the following offer[s] to
make [a] Bid-Option Loan[s]:
1. Quoting Bank: ____________________________
Contact Person: _________________________
2. Date of proposed Borrowing: __________, 200_*
3. Quotes:
Principal Bid-Option Interest
Amount** Rate*** Period ****
-------- ------- -----------
(a) _________ ___________ __________
(b) _________ ___________ ___________
(c) _________ ___________ ___________
4. The aggregate amount of Bid-Option Loans which may be accepted by the
Borrowers pursuant to this Bid-Option Quote shall not exceed $_____________.
The Bank acknowledges and agrees that this Bid-Option Quote (a) is irrevocable
and (b), subject to the terms and conditions of the Credit Agreement, obligates
it to make a Bid-Option Loan for which any quote is accepted, in whole or in
part.
[Name of Bank]
By: ______________________________________
Its: ____________________________________
* As specified in the related Invitation for Bid-Option Quotes.
** The principal amount (a) must be $5,000,000 or a larger multiple of
$1,000,000 and (b) may not exceed the aggregate amount of the related Bid-Option
Borrowing specified in the related Invitation for Bid-Option Quotes.
*** Specify rate of interest per annum (rounded up to the nearest 1/100th of 1%)
or applicable margin, which may be positive or negative, expressed as a
percentage (rounded up to the nearest 1/100th of 1%), as the case may be.
**** As specified in the related Invitation for Bid-Option Quotes.
EXHIBIT I
REQUEST FOR REVOLVING CREDIT ADVANCE
To each Bank party to
the referenced Credit Agreement
▇/▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, as Agent for the Banks
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Invacare Corporation, (the "Treasury Manager"), on behalf of the Borrowers
referred to below, hereby requests a [insert Revolving Credit Loan or Letter of
Credit Advance] pursuant to Section 2.6 of the Five-Year Credit Agreement, dated
as of October 17, 2001 (as amended or modified from time to time, the "Credit
Agreement"), among Invacare Corporation, an Ohio corporation (the "Company"),
the Borrowing Subsidiaries designated from time to time (collectively with the
Company, the "Borrowers"), the Banks referenced therein, you, as administrative
agent (the "Agent") for the Banks.
[A Revolving Credit Loan is requested to be made in the amount of _________
(specify amount of Dollars or the relevant Permitted Currency), to be made on
____________, 200_ for the account of ____________ (specify Designated Borrower)
and evidenced by such Borrower's Revolving Credit Note. Such Loan shall be a
[insert Eurocurrency Rate Revolving Credit Loan, or Floating Rate Loan] and the
initial Interest Period, if such requested Loan is a Eurocurrency Rate Revolving
Credit Loan, shall be [insert permitted Interest Period].]
[Such Letter of Credit Advance shall be made by the issuance by the Agent of its
Letter of Credit for the account of ____________ (specify Designated Borrower)
in the maximum stated amount of $___________ to and for the benefit of
________________ with a stated expiry date of _________________, 200_, and
containing the further terms and conditions set forth in the attached letter of
credit application to the Agent.]
In support of this request, the Treasury Manager, on behalf of the Borrowers,
hereby represents and warrants to the Agent and the Banks that:
1. The representations and warranties contained in Article IV of the Credit
Agreement are true and correct in all material respects on and as of the date
hereof, and will be true and correct in all material respects on the date such
Advance is made (both before and after such Advance is made), as if such
representations and warranties were made on and as of such dates.
2. No Event of Default or Default has occurred and is continuing or will exist
on the date such Advance is made and such Advance shall not cause an Event of
Default or Default.
Acceptance of the proceeds of such Advance by the Designated Borrower shall be
deemed to be a further representation and warranty by the Borrowers that the
representations and warranties made herein are true and correct in all material
respects at the time such proceeds are disbursed.
Capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Credit Agreement.
INVACARE CORPORATION
By: ______________________________________
Its: ____________________________________
Dated: ________________, 200_
EXHIBIT J
OPINION OF COUNSEL
October 17, 2001
To each Bank party to the referenced
Credit Agreement
▇/▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, as Agent for
each of the Banks
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We refer to the Five-Year Credit Agreement dated as of October 17, 2001 (the
"Credit Agreement") by and among Invacare Corporation, an Ohio corporation (the
"Company"), certain subsidiaries designated therein (the "Borrowing
Subsidiaries" and collectively with the Company, the "Borrowers"), the banks
parties thereto (the "Banks"), and Bank One, Michigan, a Michigan corporation,
as administrative agent for the Banks (in such capacity, the "Agent"). We have
been requested by the Company and the Borrowing Subsidiaries listed on Schedule
A attached hereto (the "Domestic Borrowing Subsidiaries") to give our opinion
pursuant to Section 2.7(e) of the Credit Agreement and, for purposes of this
opinion, the terms used in this opinion, which are not defined herein, shall
have the respective meanings set forth in the Credit Agreement.
We have examined the following documents and instruments: (i) the Credit
Agreement, (ii) the Notes, (iii) the Guaranty, and (iv) other documents relating
to the transactions contemplated by the Credit Agreement (collectively, items
(i) through (iv) are referred to as the "Loan Documents"). We have also examined
and relied upon certified copies of the Company's and each Domestic Borrowing
Subsidiary's articles of incorporation, by-laws and board of directors
resolutions authorizing the Company's and each Domestic Borrowing Subsidiary's
participation in the transactions contemplated by the Credit Agreement. We have
also copies of all such documents and records of the Company and the Domestic
Borrowing Subsidiaries and all such other documents and records, and have made
such investigations of law, as we have deemed necessary and relevant as a basis
for our opinion. With respect to material factual matters not independently
established by us, we have relied upon certificates of officers of the Company
and the Domestic Borrowing Subsidiaries, which reliance we deemed appropriate in
the circumstances.
Based upon the foregoing, it is our opinion that:
1. Each of the Company and each Domestic Borrowing Subisdiary is a corporation
duly organized, validly existing and in good standing under the laws of the
state of its respective organization or incorporation, and each is duly
qualified to do business, and is in good standing, in all additional
jurisdictions where such qualification is necessary under applicable law, except
where the failure to so qualify to be so would not have a material adverse
effect on the business and financial condition of the Company and its
Subsidiaries taken as a whole. Each of the Company and each Domestic Borrowing
Subsidiary has all requisite corporate power to own or lease the properties used
in its business and to carry on its business as now being conducted. The Company
and each Domestic Borrowing Subsidiary has all requisite corporate power to
execute and deliver the Loan Documents to which it is a party and to engage in
the transactions contemplated by the Loan Documents.
2. The execution, delivery and performance by the Company and each Domestic
Borrowing Subsidiary of the Loan Documents have been duly authorized by all
necessary corporate action and are not in contravention of any law, rule or
regulation, or any judgment, decree, writ, injunction, order or award of any
arbitrator, court or governmental authority, or of the terms of the Company's or
any Domestic Borrowing Subsidiary's charter or by-laws, or of any material
contract or undertaking to which the Company or any Domestic Borrowing
Subsidiary is a party or by which the Company or any Domestic Borrowing
Subsidiary or any of their respective property may be bound or affected, and
will not result in the imposition of any Lien except for Permitted Liens.
3. The Loan Documents to which the Company or any Domestic Borrowing Subsidiary
is a party are the legal, valid and binding obligations of the Company and each
Domestic Borrowing Subsidiary enforceable against the Company and each Domestic
Borrowing Subsidiary in accordance with their respective terms.
4. Schedule 4.4 of the Credit Agreement correctly sets forth the corporate name,
jurisdiction of incorporation and ownership of each Subsidiary of the Company.
5. To the best of our knowledge and except as set forth in Schedule 4.5 of the
Credit Agreement, there is no action, suit or proceeding pending or threatened
against or affecting the Company or any of its Subsidiaries before or by any
court, governmental authority or arbitrator, which if adversely decided might
result, either individually or collectively, in any material adverse change in
the business, properties, operations or financial condition of the Company or
any of its Subsidiaries taken as a whole or in any material adverse effect on
the legality, validity or enforceability of any Credit Agreement and, to the
best of the Company's knowledge, there is no basis for any such action, suit or
proceeding.
6. No consent, approval or authorization of or declaration, registration or
filing with any governmental authority or any nongovernmental person or entity,
including without limitation any creditor, lessor or stockholder of the Company
or any of its Subsidiaries, is required on the part of the Company or any
Subsidiary in connection with the execution, delivery and performance of the
Loan Documents or the transactions contemplated thereby or as a condition to the
legality, validity or enforceability of the Loan Documents, except where the
failure to obtain such consents, approvals, authorizations, declarations,
registrations or filings would not have a material adverse effect on the Company
and its Subsidiaries, taken as a whole.
This opinion is subject to the qualifications that the enforcement of the rights
and remedies set forth in the Loan Documents are subject to the effect of
applicable bankruptcy, insolvency and other similar laws affecting the
enforcement of creditors' rights generally, and general principles of equity,
whether applied in a proceeding at law or in equity.
Very truly yours,
EXHIBIT K
REQUEST FOR CONTINUATION OR
CONVERSION OF REVOLVING CREDIT LOAN
[Date]
To each Bank party to
the referenced Credit Agreement
▇/▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇,
as Agent for the Banks
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Invacare Corporation, (the "Treasury Manager") on behalf of the Borrowers
referred to below, hereby requests that ____________ (specify amount of Dollars
or relevant Permitted Currency) of the principal amount of the Revolving Credit
Loan originally made on ____________, 200_, which Revolving Credit Loan is
currently a [insert type of Loan], be continued as or converted to, as the case
may be, a [insert type of Loan requested] denominated in _____________ (specify
Dollars or relevant Permitted Currency) on ______________, 200_. If such Loan is
requested to be converted to a Eurocurrency Rate Revolving Credit Loan, the
Borrower hereby elects an Interest Period for such Loan of [insert permitted
Interest Period].
In support of this request, the Treasury Manager, on behalf of the Borrowers,
hereby represents and warrants to the Agent and the Banks that:
1. The representations and warranties contained in Article IV of the Credit
Agreement are true and correct in all material respects on and as of the date
hereof, and will be true and correct in all material respects on the date such
Loan is [continued][converted] (both before and after such Loan is
[continued][converted]), as if such representations and warranties were made on
and as of such dates.
2. No Event of Default or Default has occurred and is continuing or will exist
on the date such [Loan][Advance] is [continued][converted] (whether before or
after such Loan is [continued][converted]).
Acceptance of the proceeds of such [continued][converted] Loan by the Designated
Borrower shall be deemed to be a further representation and warranty that the
representations and warranties made herein are true and correct in all material
respects at the time of such [continuation] [conversion].
Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Five-Year Credit Agreement, dated as of October 17,
2001 among Invacare Corporation, an Ohio corporation (the "Company"), the
Borrowing Subsidiaries designated therein from time to time (collectively with
the Company, the "Borrowers"), the banks named therein, and you, as
administrative agent for the Banks.
INVACARE CORPORATION
By: __________________________________
Its: _______________________________
EXHIBIT L
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Five-Year Credit Agreement dated as of October 17,
2001 (the "Credit Agreement") among Invacare Corporation, an Ohio corporation
(the "Company"), certain Borrowing Subsidiaries designated therein from time to
time (collectively with the Company, the "Borrowers"), the banks named therein
(the "Banks"), and Bank One, Michigan, as administrative agent for the Banks
(the "Agent"). Terms defined in the Credit Agreement are used herein with the
same meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as follows:
1. The Assignor hereby sells and assigns (without recourse) to the Assignee, and
the Assignee hereby purchases and assumes from the Assignor, an interest in and
to the Assignor's rights and obligations under the Credit Agreement as of the
date hereof equal to the percentage interest specified on Schedule 1 of all
outstanding rights and obligations under the Credit Agreement. After giving
effect to such sale and assignment, the Assignee's Commitments and the amounts
of the Advances owing to the Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and beneficial
owner of the interest being assigned by it hereunder and that such interest is
free and clear of any adverse claim; (ii) makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or any other instrument or document furnished pursuant
thereto; (iii) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Borrower or the performance or
observance by any Borrower of any of its obligations under the Credit Agreement
or any other instrument or document furnished pursuant thereto; and (iv)
attaches the Note or Notes held by the Assignor and requests that the Agent
exchange such Note or Notes for a new Note or Notes payable to the order of the
Assignee in an amount equal to the Commitments assumed by the Assignee pursuant
hereto and the Assignor in an amount equal to the Commitments retained by the
Assignor under the Credit Agreement, respectively, as specified on Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.6 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon the Agent, the Assignor or any other Bank and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iii) appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers and discretion under the Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers and discretion as are reasonably incidental thereto; (iv) agrees that it
will perform in accordance with their terms of all of the obligations that by
the terms of the Credit Agreement are required to be performed by it as a Bank;
and (v) if the Assignee is organized under the laws of a jurisdiction outside
the United States, attaches the forms prescribed by the Internal Revenue Service
of the United States certifying as to the Assignee's status for purposes of
determining exemption from United States withholding taxes with respect to all
payments to be made to the Assignee under the Credit Agreement and the Notes or
such other documents as are necessary to indicate that all such payments are
subject to such taxes at a rate reduced by an applicable tax treaty.
4. Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance and recording by the Agent. The effective
date for this Assignment and Acceptance (the "Effective Date") shall be the date
of acceptance hereof by the Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by the Agent, as of the Effective Date,
(i) the Assignee shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after the Effective
Date, the Agent shall make all payments under the Credit Agreement and the Notes
in respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and commitment fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement and the Notes for periods prior to the
Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the laws of the State of Michigan.
8. This Assignment and Acceptance 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 all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of
Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as
delivery of a manually executed counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to this
Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date specified thereon.
[ASSIGNOR]
BY:______________________________________
ITS:___________________________________
[ASSIGNEE]
-----------------------------------------
BY:______________________________________
ITS:__________________________________
EXHIBIT M
COMPLIANCE CERTIFICATE
To: The Banks part to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain Five-Year
Credit Agreement dated as of October 17, 2001 (as amended, modified, renewed or
extended from time to time, the "Credit Agreement") among Invacare Corporation
(the "Company"), the other Borrowers designated therein from time to time, the
banks party thereto and Bank One, Michigan, as Agent for the Banks. Unless
otherwise defined herein, capitalized terms used in this Compliance Certificate
have the meanings ascribed thereto in the Credit Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected Chief Financial Officer of the Company;
2. I have reviewed the terms of the Credit Agreement and I have
made, or have caused to be made under my supervision, a detailed
review of the transactions and conditions of the Company and its
Subsidiaries during the accounting period covered by the attached
financial statements;
3. The examination described in paragraph 2 did not disclose, and
I have no knowledge of, the existence of any condition or event
which constitutes a Default or Event Default during or at the end
of the accounting period covered by the attached financial
statments or as of the date of this Certificate, except as set
forth below; and
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Company's compliance with certain
covenants of the Credit Agreement, all of which data and
computations are true, complete and correct.
The foregoing certifications, together with the computations set
forth in Schedule I and the financial statements delivered with
this Certificate in support hereof, are made and delivered
this____ day of _____, 200__.
INVACARE CORPORATION
By:_____________________
Chief Financial Officer
Invacare Corporation
Covenant Compliance Certificate
5.2(a) Interest Coverage Ratio
Calculation of EBIT
i Net Income in current period
ii Interest Expense in current period
iii Taxes in current period
iv EBIT in current period (sum of i through iii)
Four Quarter Calculation of EBIT
v EBIT from prededing fiscal quarter
vi EBIT from second preceding quarter
vii EBIT from third preceding quarter
viii EBIT fro last four quarters (sum of iv through vii)
Four Quarter Calculation of Interest Expense
ix Interest Expense in current period (ii above)
x Interest Expense in preceding fiscal quarter
xi Interest Expense in second preceding fiscal quarter
xii Interest Expense in third preceding fiscal quarter
xiii Interest Expense for last four quarters (ix through xii)
xiv Interest Coverage Ratio (viii divided by xii)
xv Minimum Interest Coverage Ratio required 3.0 to 1.0
Compliance (line xiv greater than line xv) Y/N
(circle)
5.2(b) Net Worth
Calculation of Net Worth
i consolidated net worth from financial statements
ii comprehensive earnings (positive or negative)
iii Treasury stock (not to exceed-$100 million)(enter as a negative)
iv Net Worth as defined in Credit Agreement (i minus ii minus iii)
v Required Net Worth from prior certificate (line 5.2(b)xii)
vi Net Income at Fiscal Year End (if less than $0 enter $0)
vii Net Worth Increase Factor 50%
viii Current Period increase from net income (vi multiplied by vii)
ix Proceeds from issuance or sale of Capital Stock
x Net Worth increase factor 75%
xi Current Period increase from issuance of capital stock
(ix multiplied by x)
xii Required net Worth this period (v plus viii plus xi)
xiii Net Worth 9line iv)
xiv Minimum Net Worth Required (line xii)
Compliance (line xii greater than line xiv)? Y/N
(circle)
5.2(c) Total Debt to Adjusted EFITDA
Calculation of Adjusted EBITDA
i EBIT in current period (line 5.2(a) iv above)
ii Depreciation and amortization expense in current period
iii Extraordinary, unusual or non-recurring gains (enter as positive)
iv Extraordinary, unusual or non-recurring non-cash losses (enter
as a negative)
v Current period adjusted EBITDA (i plus ii minus iii minus iv)
vi EBITDA from preceding fiscal quarter
vii EBITDA from second preceding quarter
viii EBITDa from third preceding quarter
ix Proforma EBITDA from acquisitions not included in i through viii above
(see attached schedule)
x Adjusted EBITDA for last four quarters (sum of v through viii)
Total Debt Calculation
xi Debt for borrowed money
xii Liabilities secured by any Lien
xiii Outstanding letters of credit
xiv Outstanding amount under Securitization Transactions
xv Contingent Liabilities related to xi through xiv
xvi Total Debt in current period (sum of xi through xv)
xvii Total Debt to Adjusted EBITDA (xvi divided by x)
xviii Maximum Total Debt to Adjusted EBITDA permitted 3.25 to 1.0
Compliance (line xvii less than line xviii)? Y/N
(circle)
5.2(d) Liens
Compliance with 5.2(d), including subsections (i) through
(ix)? Y/N
(circle)
5.2(e) Merger; Etc.
Compliance with 5.2(e)? Y/N
(circle)
5.2(f) Disposition of Assets; Etc.
Compliance with 5.2(f), including subsections (i) and (ii)? Y/N
(circle)
5.2(g) Nature of Business
Compliance with 5.2(g)? Y/N
(circle)
5.2(h) Negative Pledge Limitation
Compliance with 5.2(h) Y/N
(circle)
5.2(i) Limitation on Indebtedness of Subsidiaries
Compliance with 5.2(i), including subsections (i) and (ii)? Y/N
(circle)
5.2(j) Investments
Compliance with 5.2(i), including subsections (i) and (xi)? Y/N
(circle)
5.2(k) Contingent Liabilities
Compliance with 5.2(k)? Y/N
(circle)
5.2(l) Transactions with Affiliates
Compliance with 5.2(l)? Y/N
(circle)
5.2(m) Additional Covenants
Compliance with 5.2(m)? Y/N
(circle)
5.2(n) Acquisitions
Compliance with 5.2(n)? Y/N
(circle)
PRICING SCHEDULE
============================ ===================== ====================== ===================== ==================== ===============
APPLICABLE MARGIN LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS LEVEL IV STATUS LEVEL V STATUS
============================ ===================== ====================== ===================== ==================== ===============
============================ ===================== ====================== ===================== ==================== ===============
Eurocurrency Rate 0.675% 0.775% 1.00% 1.20% 1.40%
============================ ===================== ====================== ===================== ==================== ==============
============================ ===================== ====================== ===================== ==================== ==============
APPLICABLE FEE RATE LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS LEVEL IV STATUS LEVEL V STATUS
============================ ===================== ====================== ===================== ==================== ==============
---------------------------- --------------------- ---------------------- --------------------- -------------------- --------------
Letter of Credit Fee 0.675% 0.775% 1.00% 1.20% 1.40%
---------------------------- --------------------- ---------------------- --------------------- -------------------- --------------
Facility Fee 0.20% 0.225% 0.25% 0.30% 0.35%
============================ ===================== ====================== ===================== ==================== ==============
For the purposes of this Schedule, the following terms have the
following meanings and all other capitalized terms used but not defined herein
shall have the meanings set forth in the Agreement, subject to the final
paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Company delivered pursuant to the Agreement.
"Level I Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials, the
Leverage Ratio is less than or equal to 1.50 to 1.00.
"Level II Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials, (i) the
Company has not qualified for Level I Status and (ii) the Leverage Ratio is less
than 2.0 to 1.00.
"Level III Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials, (i) the
Company has not qualified for Level I Status or Level II Status and (ii) the
Leverage Ratio is less than 2.50 to 1.00.
"Level IV Status" exists at any date if, as of the last day of the
fiscal quarter of the Company referred to in the most recent Financials, (i) the
Company has not qualified for Level I Status, Level II Status or Level III
Status and (ii) the Leverage Ratio is less than 3.00 to 1.0.
"Level V Status" exists at any date if the Company has not qualified
for Level I Status, Level II Status, Level III Status or Level IV Status.
"Status" means Level I Status, Level II Status, Level III Status, Level
IV Status or Level V Status.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Company's Status as reflected
in the then most recent Financials. Adjustments, if any, to the Applicable
Margin or Applicable Fee Rate shall be effective five Business Days after the
Agent has received the applicable Financials. If the Company fails to deliver
the Financials to the Agent at the time required pursuant to the Credit
Agreements, then the Applicable Margin and Applicable Fee Rate shall be the
highest Applicable Margin and Applicable Fee Rate set forth in the foregoing
table until five days after such Financials are so delivered.
SCHEDULE 1.1
COMMITMENTS
--------------------------------------------------------------------------------
REVOLVING CREDIT COMMITMENTS
================================================================================
----------------------------------------------- --------------------------------
Bank Revolving Credit Commitment
----------------------------------------------- --------------------------------
----------------------------------------------- -------------------------------
Bank One, Michigan $ 48,750,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
KeyBank National Association 48,750,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
National City Bank 34,411,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Bank of America, NA. 34,411,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
The Chase Manhattan Bank 24,852,000
----------------------------------------------- -------------------------------
----------------------------------------------- --------------------------------
The Bank of New York 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Credit Lyonnais New York Branch 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
Fifth Third Bank 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
▇▇▇▇▇▇ Bank Trust and Savings 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
▇▇▇▇▇▇ Bank Plc 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
PNC Bank, National Association 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
SunTrust Bank 19,118,000
----------------------------------------------- --------------------------------
----------------------------------------------- --------------------------------
$ 325,000,000
----------------------------------------------- --------------------------------
October 17, 2001
SCHEDULE 4.4 to LOAN AGREEMENT
Dated as of October 17, 2001
SUBSIDIARIES
As of: October 17, 2001
Jurisdiction of % of Voting Stock
Name of Subsidiary Incorporation Owned
------------------ --------------- ------------------
Adaptive Research Laboratories Inc. Texas 100%
Adaptive Switch Laboratories Inc. Texas 100%
BME Inc. Texas 100%
Dynamic Controls Limited New Zealand 100%
Dynamic Europe Limited United Kingdom 100%
EC-Invest A/S Denmark 100%
France Reval GmbH Germany 100%
France Reval SA France 100%
Garden City Medical Delaware 100%
Genus Medical Products USA Inc. New York 100%
Groas A/S Norway 100%
▇▇▇▇▇▇▇▇ Mobility Limited New Zealand 100%
Healthtech Products Inc. Missouri 100%
Indian-▇▇▇ Inc. Illinois 100%
Invacare AB Sweden 100%
Invacare AS Norway 100%
Invacare Australia Pty Ltd. Australia 100%
Invacare B. V. Netherlands 100%
Invacare Canada Inc. Ontario 100%
Invacare Credit Corporation Ohio 100%
Invacare (Deutschland) GmbH Germany 100%
Invacare EC-Hong A/S Denmark 100%
Invacare Florida Corporation Delaware 100%
Invacare Holding AB Sweden 100%
Invacare International Corporation Ohio 100%
Invacare New Zealand Limited New Zealand 100%
Invacare NV Belgium 100%
Invacare ▇▇▇▇▇▇▇ ▇▇ France 100%
Invacare Portugal LDA Portugal 100%
Invacare ▇▇▇ ▇▇ Sweden 100%
Invacare Respiratory Corp. Ohio 100%
Invacare S.A. Spain 100%
Invacare Supply Group Massachusetts 100%
Invacare Trading Company Inc. Virgin Islands 100%
2
Invacare (UK) Limited United Kingdom 100%
Invamex, S.A. de C.V. Mexico 100%
Invatection Insurance Company Inc. Vermont 100%
IVC Holdings Denmark A/S Denmark 100%
Kuschall Design AG Switzerland 100%
Lopital Nederland B.V. Netherlands 100%
Matia SA France 100%
Medical Equipment Repair Services Inc Florida 100%
Mobilife Corporation Missouri 100%
Mobilite Building Corporation Florida 100%
Mobilite Corporation Florida 100%
Niltek A/S Denmark 100%
Patient Solutions Inc. Delaware 100%
Pro Med Australia Pty Ltd. Australia 100%
Pro Med Equipment Pty Ltd. Australia 100%
Production Research Corporation Maryland 100%
Quantrix Consultants Limited New Zealand 100%
R2P S.a.r.L. France 100%
Radius A/S Denmark 100%
Revato B.V. Netherlands 100%
Rollerchair Pty Ltd. Australia 100%
Samarite B.V. Netherlands 100%
Scandinavian Mobility GmbH Germany 100%
Scandinavian Mobility International A/S Denmark 100%
Scandinavian Mobility Medical Services B.V. Netherlands ▇▇▇%
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇%
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ 100%
Services B.V. Netherlands 100%
Silcraft Corporation Michigan 100%
St. Louis Distributors Inc. Massachusetts 100%
The Aftermarket Group Inc. Delaware 100%
3
SCHEDULE 4.5 to LOAN AGREEMENT
Dated as of October 17, 2001
LITIGATION
As of: October 17, 2001
None
4
SCHEDULE 4.12 to LOAN AGREEMENT
Dated as of October 17, 2001
ENVIRONMENTAL AND SAFETY MATTERS
As of: October 17, 2001
None
5
SCHEDULE 5.2 (d) to LOAN AGREEMENT
Dated as of October 17, 2001
LIENS
As of: October 17, 2001
None
6
SCHEDULE 5.2 (j) to LOAN AGREEMENT
Dated as of October 17, 2001
INVESTMENTS
As of: October 17, 2001
None
7